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November 10th 2013 print

Peter Smith

Fast Boat to Enlightenment

That the Greens’ fanciful economic prescriptions are taken seriously by many voters and sections of the commentariat testifies to a lack of reflection on how economies really work. A huge container ship makes a splendid classroom

magellanI recently finished a twenty-seven-day voyage, as the only passenger, on a not-so slow-boat from Hong Kong to Southampton. Magellan (left) is apparently the third largest container ship in the world; theoretically able to carry the equivalent of 13,800 (standard-sized) twenty-foot containers, each with a capacity of ≈1170 cu ft. Its engine is equalled in size by only one other conventional ship (unsurprisingly, by the largest container ship). For the mechanically minded; it is a marine diesel, fuel injected, internal combustion, two-stroke engine with fourteen ‘giant’ pistons, each almost a metre in diameter; generating 109,000 hp. I can personally vouchsafe that it is very large and loud.

On this voyage, the ship was carrying the equivalent of nearly 10,000 twenty-foot containers. Each container, which can be more than double the length and taller than standard-sized, can hold up to about 28 tonnes of cargo. Why mention any of this? Its relevance will become clear after a short digression on pirates; recently in the news again when HMAS Melbourne, as part of Combined Maritime Forces combating Somalian pirates, nabbed nine of them and destroyed their boats.

I was assured that our ship was too big and too fast to be boarded by Somalian pirates. Nevertheless we travelled in an internationally recommended two-mile-wide transit corridor when in ‘pirate territory’(within which naval and military protection might be more quickly afforded if needed); had a citadel (akin to a panic room) in the hull, helmets and flak jackets on the bridge, a list of duties in the event of pirate attack, hoses at the ready to flood ballast-tank water over the aft sides of the ship to impede scaling up boarding ladders; and the security level was lifted as we approached the Horn of Africa on the way to the Red Sea. And all of these precautions were in place on a ship that, apparently, “couldn’t be boarded”.

A landlubber like me could get alarmed. This was especially the case when I read, in the on-board booklet dedicated to the threat, that pirates commonly attacked the bridge with rocket propelled grenades. What, not just with swashbuckling swords? What has the world come to? Fortunately, we successfully ran the gauntlet and came out unscathed. But make sure, if you do the trip, that the ship is big and fast or has armed guards, as some more vulnerable ships do.

Peter Smith’s further guide to freighter cruising

Anyway this business with pirates is by the way, as are my own experiences on board. To the point; a container ship provides a practical and grounding lesson on the realities of modern economic life that school children might be taught, rather than being brainwashed with fairy tales about sustainable development and the achievements of primitive indigenous populations who remained at the same level of bare subsistence century in and century out.

Our very way of life, our prosperity, our ability to help those among us in need, are all critically dependent on making things and trading things across both small and vast distances; for which we need the application of business acumen, skill, hard work and, critically, cheap and plentiful supplies of propulsive energy. That is the way the lesson might begin. A series of questions would follow to generate discussion and insight in the modern interactive classroom.

One question might go like this. If it takes around 4,700 tonnes of marine diesel fuel at US600 per tonne to shift, say, in round numbers, one-hundred thousand tonnes of cargo from Hong Kong to Southampton, how many batteries charged by windmills and/or solar panels would it take and how much would it cost? For mathematics students this would be a valuable introduction to the law of large numbers and to equations incapable of solution.

Another question might go like this. Is it possible for us to enjoy the ownership of mobile phones, computers, flat-screen TVs, cars, and all of our other modern conveniences without the taxing business of their manufacture and shipment? For philosophy students this would be instructive on the concept of cause and effect. For physics students, it may take them on whimsical and entertaining flights of fancy to matter transmutation (alchemy) and transference (beam me up Scotty). For anthropological students, it may throw light on the development of cargo cults among primitive peoples.

And talking of backward people, adult classes might also be held for those who vote for the Greens or for anyone, for that matter, who is prone to thinking that goods simply appear out of thin air and/or that more of them can be made available than are produced. This is a relatively modern malady – akin to the rise of a new cargo cult – prevalent among the intellectual elite in the media and the universities, and among charity and church office holders, as well as among many common people who otherwise display no proclivity to believe in magic.

What has happened, quite apart from the drift of industry to Asia, is that manufacturing and transport industries have become so efficient that they are remote from the lives of most people living in the Western world. Far fewer people are now down the pit, or on the factory floor, or on the docks, or on oil tankers and container ships; or have close relationships with such people.

For example, increasingly those working at sea have more experience of manning an entertainment ship than they have of a working ship. Queen Mary II and Magellan provide an instructive comparison. On the side of using up value is QMII, with 1250 officers and crew. On the side of making value is the slightly bigger Magellan, with just 28 officers and crew. Moreover, this manning level will undoubtedly continue to edge down in future as will all “coal-face” jobs across mining, manufacturing, and transport industries.

The increasing lack of close familiarity with what it takes to make and transport commodities has proved to be fertile ground for breeding a fast-spreading form of infantile mindset, which is as divorced from economic reality as the mindset of primitive cargo cultists. As experience is providing progressively less of a countervailing force, the remedy has to lie in public education.

Instead of vacuously and mindlessly teaching kids the virtues and moral equivalence of patently backward and inferior cultures, ancient and present-day, they should be given the opportunity to understand and appreciate what underpins our material prosperity; and what is required to maintain and increase this prosperity, if we are to live comfortable lives and also help those in need.

Time spent at mine sites; at manufacturing plants; at agricultural enterprises; at construction sites; at ship building plants; at docks and at transport hubs, would be as well spent as at museums and art galleries. They also need to understand that however rich we are, or we become, we can never be so rich that we can collectively spend more than we collectively earn. They need to be disabused of magic to prevent them from adding to the numbers of those with adult bodies yet with childish preconceptions.

When it comes to adults, instead of, or in addition to, spending money on dissuading people from smoking, or drinking too much, or eating fast food, governments might start informing people about what it has taken to give us our present standard of living (where, among other more beneficial things, we can smoke, drink and eat too excess) and what it will continue to take to allow us the luxury of taking care of the disabled and an aging population while maintaining our living standards.

We’ve arrived at the ridiculous situation where the Greens’ fanciful economic policy prescriptions are taken seriously by large numbers of voters and by sections of the intellectual commentariat. We even have, believe it or not (no, I don’t bel ieve it!), union bosses supporting a jobs-destroying carbon tax. Is there any more proof required that reason has given way to infantile posturing. “Let us all grow up”, would be fitting heading for an Abbott-inspired campaign to educate children and the childlike.

Peter Smith, a frequent Quadrant Online contributor, is the author of Bad Economics