to coordinated regional planning that enabled the state to create new markets by developing the infrastructure that private interests were not willing to take on themselves. Holt touched on this dilemma when he told a congressional hearing committee that “the big question is always, how do we pay for the large public works projects that everyone needs but that no one agency, on its own, can afford.” He also claimed that “the Alameda Corridor is possibly the best example of how multiple parties in a public/private partnership can come together to fund such large projects.”33 Again, the underlying assumption was that the state should play a key role in creating new logistics markets by funding regional infrastructure.
This ideological conflation between the market and the public good was expressed by the executive director for the POLA, who testified, “In reality, the beneficiary of the Alameda Corridor’s successful completion and operation is the American public, to whom our domestic and global transportation efficiency is critical.”34 Both of these comments exemplify the mediating role that the state has historically played in mobilizing space for the advancement of capitalism when individual capitalists cannot agree to take collective action.35 Capitalists are also buttressed by the conflation between the interests of capital and an undifferentiated “American public,” a point that becomes more important when we discuss how social movement organizations contested this claim.
Cooperation and state support were particularly important to financial underwriters because they introduced greater stability and thus made the project more feasible for long-term finance schemes. Consequently, as Holt explained, Congress set aside a “$59 million appropriation for a loan-loss reserve [which] made a $400 million loan available which, in turn, made it possible to borrow an additional $1.2 billion from the capital markets to complete the $2.4 billion total project cost [for the Alameda Corridor].”36 In total, the $2.4 billion needed to complete the Alameda Corridor came from a variety of public-private sources, including, revenue bonds (51%); Federal loans (18%); The Ports (18 %); California State grants (8%) and other sources (5%), mostly from the LA MTA.37
Aside from the funding, the Alameda Corridor also taught policy makers how to act regionally and how to deploy public financing to support the region’s goods movement infrastructure, a lesson they would apply to future projects. In fact, the federal loan to ACTA served as a model for the Transportation Infrastructure Finance and Innovation Act (TIFIA) of 1998, a federal program that provides direct loans and lines of credit to “projects of national and regional significance.” TIFIA provided “improved access to capital markets, flexible repayment terms, and potentially more favorable interest rates than can be found in private capital markets for similar instruments.”38 In short, ACTA taught local and federal actors how to mobilize the state for private-public partnerships by rescaling the spatial politics of growth. Regional cooperation was particularly important as the cost of infrastructure projects rose and local funding sources dwindled.
Federal programs like TIFIA encouraged regional coordination and created incentives for local actors to develop new institutions and governance networks. SCAG’s adoption of the National Freight Gateway Strategy Agreement in 2006 marked a significant move toward greater collaboration. The agreement was established through a memorandum of understanding that encouraged coordinated efforts on transportation capacity and environmental protection. Major federal and local agencies signed on, including the U.S. Department of Transportation (USDOT), the Environmental Protection Agency (EPA), the Army Corps of Engineers, the California Department of Transportation (CADOT), SCAG, and transportation authorities for local counties.39 The memorandum incentivized regional collaboration by giving signees access to more funding. According to the agreement, agencies pledged “to cooperate with all stakeholders in the area to improve freight throughput capacity while protecting and enhancing the natural and human environment.” Yvonne Burke, Los Angeles County supervisor and SCAG’s then president, claimed that “this new Southern California partnership will be vital to ensure our entire region’s mutual goods movement needs, from the Ports to the farthest reaches of the Inland Empire.”40
Each of the projects that I have outlined in this section assumed that logistics was a viable growth industry and that it provided social benefits for the region’s residents. Both of these claims were part of the ideological toolkit that regional leaders used to expand the geographic reach of logistics development.
NEW REGIONAL LOGICS
Port boosters used their publicly subsidized funds to modernize shipping facilities near the docks. Many of the initial projects focused on updating existing technologies to keep up with shifts in the logistics industry. This included building new facilities that accommodated bigger shipments. In fact, the ability to accommodate massive post-Panamax ships, which can carry more than eight thousand TEUs, made the San Pedro Bay a lucrative gateway choice for shippers looking to transport large quantities of containers from Asian markets to the continental United States; something other ports, like those in the Bay Area, were struggling to keep up with. Large ship capacity is just one of the factors that enabled the San Pedro Bay ports to capture 56 percent of containerized Asian imports by 2005.41 Port leaders also implemented strategies like the Pier Pass Program, which increased capacity by moving more traffic to off-peak hours.42 While these changes successfully increased capacity, policy makers were convinced that the existing trade infrastructure would not meet the region’s future needs.
Port expansion continued in the 2000s, but Southern California faced mounting competition from other regions, including Canada and the East Coast. Boosters cited the increased competition from other ports to further consolidate public support for regional logistics. Local leaders were especially concerned that the expansion of the Panama Canal, scheduled to be completed by 2015, would allow East Coast ports to siphon off future trade, away from Southern California.43 Concerns mounted in 2003 when the Panama Canal Authority forged a strategic marketing alliance that openly encouraged shippers to bypass West Coast ports. The alliance was meant to “spur investment, increase trade and promote the ‘All-Water-Route’ (the route from Asia to the U.S. East and Gulf Coasts via the Panama Canal).”44 Canal leaders signed memorandums of understanding with ten U.S. ports, including the Port Authority of New York and New Jersey, the Georgia Ports Authority, and the South Carolina State Ports Authority.45 The partnership was another example of how entrepreneurial state actors competed with other regions for capital investment by forming new distribution networks.
Southern California’s overland system of trucks and trains maintained its competitive advantages in the face of growing competition, especially among shippers who wanted an efficient JIT distribution system. West Coast distribution enabled shippers to reroute delivery trucks much more quickly than having to orchestrate the same task via ship, especially if market conditions changed while the goods were at sea. Instead, ships could deliver their goods to Southern California, where they could then be dispatched to the correct markets, all in a timelier manner than having to wait for ships to make their deliveries through the Panama Canal. A time advantage was especially enticing to shippers who managed high-value goods because it enabled them to avoid delivery interruptions. Overland distribution also provided greater protection from delays. If shipments for multiple markets are traveling on a single ship and that ship is delayed along the longer all-ocean route through the Panama Canal, then many more markets may be affected. Trucks, trains, and cross-dock facilities allow shippers to distribute the risk across different markets; fewer markets are affected if one truck is delayed than when an entire ship loaded with containers is delayed. Southern California ports capitalized on these flexible management techniques and gained a competitive advantage over other regions.
Nonetheless, Southern California’s port boosters used mounting port competition to seek federal support for logistics development. This was especially true when Canadian port leaders—including government actors—aggressively courted shippers by launching a multi-million-dollar marketing campaign aimed directly at Southern California. In 2009 Geraldine Knatz, then the executive director for the POLA, responded to the campaign by declaring, “We’re not going to sit around and
