PORT AUTHORITIES AND ONIONIZATION
Port authorities in 1945 presided over the entry and exit points for transformed postwar global trade/financial systems. Port authorities confronted the huge change in transportation, logistics technology, global trade patterns, international finance and competing infrastructure coming on line. They met the challenge. After WWII port authorities became superpower EDOs. Having achieved superpower status, port authorities started playing in their own league—becoming role models for our onionization and siloization professional dynamics. The following sections outline postwar port authority change to American state/sub-state economic development. Interwoven into our discussion are two objectives: (1) factors drove that growth and expanded functionality; and (2) how port authorities offer insight into the professional dynamics.
There are obvious factors/dynamics that prompted growth in postwar port authorities: for example, military needs and economic opportunities resulting from postwar US global leadership. As leader of the Free World and for more than a decade the only major economy whose infrastructure and economic system was not obliterated by the war, America came close to a monopoly in trade and finance. Bretton Woods set the dollar as the world’s reserve currency—the hegemon of the world economic and finance system. WWII required considerable shipbuilding infrastructure, naturally tied to America’s ports. The need for these facilities diminished, however, and after the war these facilities closed or were transferred to states/cities. Port authorities were the natural beneficiary of the new infrastructure.
Also, the question as to who would build/manage airports was timely. In most metro areas, it came down to an independent port authority or the city directly or through its own captive port authority. The federal government (the CAB and FAA) by the late 1950s almost compelled new airport construction to accommodate new (and louder) planes. The Supreme Court (1962) held airports liable for damage caused by noise (including diminished property value).14 So, by the end of the 1950s, most airport construction was outside Big City limits, favoring establishment of a port-like authority (Altshuler and Luberoff, 2003, pp. 128–36).
As for marine transportation facilities, the St. Lawrence Seaway, the world’s longest deep-draft navigation system, opened in 1959. The Seaway connected the Great Lakes directly to the Atlantic. Transportation of bulk commodities by sea was cheaper than land-based modes. That benefited Canada and marine transportation. The impact on railroads serving American Great Lakes cities, however, was horrendous. Cities whose economic bases centered on transshipment (Buffalo especially) were devastated; finished goods manufacturing and trade were rerouted to eastern seaports. On balance, the logistics impact disrupted American auto-based, finished goods industry sectors, destroyed their transshipment function and single-handedly began the long, sad trail of Great Lakes cities to their present chronically troubled status.
Predictably, Great Lakes states and communities responded by creating port authorities and devoting more attention and resources to their ports. Ohio (1955) enacted legislation which over the next several decades established both a sub-state (large cities, counties) Great Lakes port authority system and an internal, river-based port authority system. Locally controlled, these systems function to the present day and are significant elements in Ohio’s present-day ED system. Toledo-Lucas County (Ohio’s first), Illinois (Chicago) Port District, Waukegan and Oswego New York (1955), Indiana (1961), Erie PA (1962), Lorain Ohio (1964), Brown County (Green Bay WS, 1965), BuffaloNiagara Frontier (1967) and Cleveland (1968) were initiatives triggered in anticipation of or reaction to the Seaway.
The Intracoastal Waterway
The impact of the Intracoastal Waterway on state and sub-state economic development is little noticed, but it increased the number and functionality of port authorities along its route:
The Intracoastal Waterway, navigable toll-free shipping route, extending for about 3,000 miles along the Atlantic and Gulf of Mexico coasts … [accesses] sounds, bays, lagoons, rivers and canals and is usable in many portions by deep-draft vessels. The route is federally maintained [Corps of Engineers] and is connected to inland waterways in many places. It was originally planned to form a continuous channel from New York City to Brownsville, Texas, but the necessary canal link through northern Florida was never completed; hence, it is now in two separate sections—the Atlantic and the Gulf.15
The Intracoastal Waterway has a long history (Alperin, 1983), almost as long as the National Road. First proposed by Treasury Secretary Albert Gallatin in 1808, actual construction began in 1885 with dredging by the Florida Canal Company.16 From that time through World War II various portions were completed in spasms. World War II (protect coastal trade from German submarines) seriously accelerated construction in both sections of the Waterway. Today, the Atlantic Waterway south of Norfolk tends to be tourist/pleasure boat, small seaport/waterfront-oriented, but the Gulf Waterway is another matter entirely. Connecting Mississippi River inland waterways to Gulf industry centers, oil/chemical refining, oil/gas exploration/production and small business fishing, the Gulf section is heavily industrial/commercial.17
Texas took a leading interest in the Gulf Waterway, and by the 1920s key Texas coastal ports established port authorities that allowed minimally inland cities access to the Gulf. In the postwar, Beaumont (1949), Calhoun County Texas (1953), Port of Galveston (1940), Greater Baton Rouge (1952), Mississippi State Port Authority (Gulfport, 1960), Jackson County (Pascagoula, 1956), Port Arthur (1963) and South Louisiana Port Commission (1968) testify to the salience of both port authorities and the Intracoastal Waterway. In 1975 the state of Texas assumed responsibility for the Waterway’s main channel.
Despite its bias for tourist-related usage, the Atlantic Waterway also generated considerable port authority incorporation in 1970/80s’ Florida. The Cape Canaveral Port Authority (1939), Tampa-Hillsborough County (1945), Dade County (Miami) Seaport Department (1960) and Jacksonville (1963) demonstrate that international trade and intracoastal access prompted port authority formation. The early postwar incorporation of the South Carolina State Ports Authority (1942), Georgia Ports Authority (1945), North Carolina State Port Authority (1945), the State of Virginia Port Authority (1970) and the Maryland state Department of Port Administration (1971) are further testimony to the impact of postwar opportunities and their impact on port authority-based state and local ED. Georgia Port Authority vastly expanded its economic development role in 1994 with passage of the Business Expansion and Support Act (BEST) that enhanced the authority, authorized Joint Development Authority tax credits and expanded property and sales tax powers. Today this system of state port authorities is a formidable economic growth machine. South Carolina Port Authority in 2012 is credited with $45 billion in trade, for example, and Georgia Port Authority $67 billion.
“To Claim the Skies and the Seas”: New York–New Jersey Port Authority
Ironically, upon its incorporation in 1921 the two-state NY–NJ Port Authority (also PANYNJ) did not enjoy jurisdiction over the “ports” of New York or New Jersey.18 Its breakout came with the 1930 Holland Tunnel and 1931 George Washington Bridge (later Goethals and Bayonne). In 1937 it completed the Lincoln Tunnel. In Mayor La Guardia’s last year in office (1945), the authority took over two airports he had constructed (LaGuardia and Idlewild-Kennedy), later Newark (1948), Teterboro and recently Stewart. The Port Authority Bus Terminal (PABT) opened in 1950, moving into the Subway/light rail; and the NY–NJ took over the Hudson and Manhattan Railroad in 1962 and in its place established the PATH and Hudson Valley systems. A 1970 “deal” was engineered between the two states in which New York, inspired by David Rockefeller’s advocacy, empowered the port authority to revitalize southern Manhattan by clearing it and building the World Trade Center. On top of transportationrelated functions, the port authority evolved into a public real estate redeveloper/urban renewal agency. This baby has come a very long way indeed!
Somewhere in this checkered history, 1948 to be exact, the NY–NJ took over the Newark Port Authority. The heart and the soul of the authority’s marine and port legacy, however, are the ports of Newark and its Elizabeth container port—and part of the legacy is its innovation pioneered by the SS Ideal-X. An experiment, a container ship, supported by the newly rehabilitated Newark Port, the Ideal-X (developed by the McLean Trucking Company) departed the port in 1956. In 1962 NY–NJ Port Authority opened the world’s first dedicated container port, at its Elizabeth Port Authority Marine Terminal. That facility was, in 2013, the third largest port in the United States.19
In April 1956, a refitted Second World War tanker, the Ideal-X, sailed from Newark carrying 58 containers [to Houston] … It signaled the beginning of a revolution in global transportation, for at a time when it cost $5.83 per ton to load loose cargo … the cost of loading a ton onto the Ideal-X was $.15.8 cents. (Rybczynski, 2010, p. 119)
Containers are filled “at their point of origin” and shipped by truck or rail direct to the port dock and hauled up on ship by crane—the process is reversed at the destination port. There is no need for warehouses, just big parking lots and rail sidings to handle truck traffic, store containers and accommodate holding of inventory. The work is specialized and skilled, and the workforce gangs typical of On the Waterfront are drastically reduced. Access to rail switches and highways are “essentials” required for the 1960s’ cargo port. Older labor-surplus, land-locked and space-constrained pierbased harbors could neither meet these physical requirements nor accommodate the huge container ships that quickly followed. The ports themselves needed to be more accessible to the shipping routes of waterborne shipping.
As late as 1955, New Jersey announced that it was building the largest containerport in the country, and within five years, it was handling more than half of the region’s cargo. By 1970, New York City was down to only one-fiftieth of the tonnage it had a decade earlier, and most of the Manhattan and Brooklyn piers stood empty. The same cycle was repeated in other maritime cities. Oakland took the majority of shipping business from San Francisco, as did Seattle from Portland. … The old urban port of New Orleans, for example, now handles cruise ships; its freight function replaced by the sprawling Port of South Louisiana (fifty miles North of New Orleans, almost to Baton Rouge). (Rybczynski, 2010, pp. 119–20)
Not all older ports responded quickly or adequately to the container revolution. Philadelphia’s municipal port authority (a city department) was one of these. It was not until 1965 that, led by the Philadelphia Chamber of Commerce, the city joined with the State of Pennsylvania to form a new Philadelphia Port Commission (PPC).
The PPC oversaw the development of Philadelphia’s two container terminals, the Packer Avenue Marine Terminal [completed eleven years after the voyage of the Ideal-X] … in 1967, and the Tioga Marine Terminal … in 1972 … In 1978 the Philadelphia Department of Commerce released a study … the study concluded that [the two new container ports] … would reach container capacity by 1984.20
Philadelphia (not alone by any means) was slow in adjusting to containerization; the consequence was a less than perfect port—100 miles upstream and inland. Philadelphia lost its status as a first-order competitive port position. Instead, the Delaware River evolved into a 100-mile “marine highway” with more than 40 public and private port facilities. Philadelphia, 15th nationally in 2005, lost tonnage to other ports. It is also worth noting that northeastern and Great Lakes central cities lost important “golden era” functionality because of containerization. Innovation/productivity wreaks havoc on worker skills, jobs and the competitive urban hierarchy—it is not a one-way street to success.
Cast Adrift: Siloization and Onionization of Port Authorities
The NY–NJ explains why port authorities are no longer considered “mainstream” EDOs. Some became “transportation focused”; others concentrated on specialized infrastructure, marine operations and/or export–import marketing of their facilities. We are interested less in how the NY–NJ Port Authority “backed into” marine facilities, but rather that older port authorities became multi-functional. The NY–NJ Port Authority was/is multi-functionalism on steroids, but it was not uncommon in the postwar period for a port authority to be entrusted with non-port functions. Massport, for example, acquired responsibility for Logan Airport and the Tobin Bridge; a slew of other port authorities likewise drifted into airport operations.21 Smaller port authorities frequently assumed responsibility for marinas and for real estate development, redevelopment and various types of business parks. Other port authorities were empowered to operate facilities and programs designed to attract foreign trade, foreign direct investment and export and import. Other port authorities functioned chiefly in tourism and others became, in effect, community waterfront authorities.
As the scope of functions both expanded and/or contracted, becoming in either instance more specialized, port authorities “institutionalized.” They developed their own separate, picket-fence financing (and politics) and internal bureaucracies; hired on the basis of specialized skills pertinent to their functions; and, most critically, concentrated appropriately on the services and functions entrusted to them. In effect, larger port authorities similar to the NY–NJ Port Authority (those with airports) tended towards specialization in airport transportation and real estate redevelopment—other functions, like general economic development, may have gotten lost in the shuffle. Most critically, port authorities became deeply involved in the provision of services: running an airport, planning bus routes and the like. Service provision does not belong in economic development, and that confused both port authority staff and outside observers as to whether these were part of our policy area or deserved to be placed on their own. Whatever the merits of the decision, the consequences to the profession and policy area were considerable. Large blocks of pre-1945 economic development, transportation infrastructure and physical redevelopment, business attraction/ retention—and a slew of future ED initiatives—went with the port authority into our “onionization” limbo.
Also, specialization in function encourages the formation of “specialty” professional associations at both state and national level, and, in the case of port authorities, a North American organization: the American Association of Port Authorities. The identical process will later occur in regard to IDBs when in 1982 they formed the Council of Development Finance Agencies. Institutionalization usually leads to the development of a separate professional identity and a professional sub-autonomy with its own expertise, career path, picket-fence federalism and legislative/operational/public policy needs. As economic development matures in the next chapters, a pronounced tendency toward siloization by specialization in the profession appears; we are not starting down the trail of creating our patchwork profession. Siloization is a defining characteristic of contemporary American economic development, and port authorities in this period separate into their own silo. Onionization, the layering of period-specific EDOs within our jurisdictional policy systems, is more subtle, often, as will be discussed in later chapters, involving a redefinition of what constitutes “mainstream economic development.”
Ron W. Coan 