Your feelings on the UAE port deal

(Originally posted 10:19 PM ET 2/20/06 – Bumped up for more comment and additional articles of reference – scroll down for updates)

There’s lots of rumbling going on in conservative AND liberal circles over the Bush-admin approved deal that would turn over control of port operations in six US ports to a company owned by the United Arab Emirates. Story via FoxNews:

WASHINGTON — House Speaker Dennis Hastert and newly minted House Majority Leader John Boehner will soon be “flexing muscle” against the Bush administration-approved transaction that permits shifting control of port operations in six U.S. ports from a British company to a company owned by the United Arab Emirates.

“We are very concerned about it and that it could threaten our national security,” one senior House Republican leadership aide told FOX News late Monday. Another senior aide said: “Most indications point to leadership flexing muscle against this transaction.”

On Monday, New York Rep. Peter King, chairman of the House Homeland Security Committee, said he was urging President Bush to delay approval of the deal. King also said he saw many reasons to cancel it altogether.

“I’m strongly urging the president to intervene to stop this, to freeze it, to put it on hold,” King said. “This contract should not be allowed to go forward until there is a full and complete investigation. And there has not been a full investigation of this company nor of its roots in the United Arab Emirates.”

King said UAE-owned Dubai Ports World won approval without thorough administration vetting.

“There have been allegations of weapons parts going through that port to Iran,” King said of that country’s own territory. “There’s been allegations of corruption about that port. None of these have ever been investigated by our government.”

King’s comments were cleared by House GOP leaders and, according to sources, reflect the view of the House Republican Conference at large. Republicans are increasingly concerned at the political impact of the port story. They fear it could leave them vulnerable to Democratic criticism and at least partially undermine their political advantage on national security.

Late Monday, Sen. Robert Menendez, D-N.J., called on the president to intervene immediately.

“We have 10 days to stop this transaction, a transaction that we think is not in the national security of the united states, and that needs to be stopped by the president,” Menendez said.

Under federal law, the president has until March 2 to overrule approval granted by the U.S. Committee on Foreign Investment in the United States for DP World to purchase the London-basedPeninsular and Oriental Steam Navigation, which has been running the commercial operations at ports in New York, New Jersey, New Orleans, Baltimore, Philadelphia and Miami.

The multi-agency task force headed by Treasury Secretary John Snow and comprised of members of the departments of State, Justice, Commerce, Defense and Homeland Security reviewed the transaction and said it posed no national security threat.

Here’s the NYT’s write-up on the UAE port deal.

Michelle Malkin has done extensive blogging on this issue, as have many other bloggers – both on the right and left hand side of the aisle.

I share many of the same concerns as others who are blogging about this. File this under “what in the he** was the administration thinking?” I’ve yet to see a convincing argument that this is a “good deal” that we shouldn’t have to worry about.

What do you think?

Tue PM Update: On the other side of the coin, there are some who are essentially saying ‘calm down’:

Time Magazine:

The claim that six U.S. port facilities are being “sold” to a company owned by the United Arab Emirates may be grist to the election-year mill for politicians from both parties, but the resulting furor may obscure the challenges of port security. The transaction in question is the $6.8 billion acquisition by Dubai Ports World of the British P&O shipping company, to become the world’s third largest port-operator. Among P&O’s numerous worldwide operations are contracts to operate port facilities in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia. The transaction was approved by the Bush administration after a routine evaluation by the Committee on Foreign Investment in the United States, an inter-agency body that assesses the security implications of foreign acquisitions of major U.S. infrastructure assets. U.S. officials say that both P&O and Dubai Ports World have solid security records.

Still, the deal has been opposed by a Miami based port operator, Continental Stevedoring & Terminals Inc., which has gone to court to challenge the measure on security grounds. And politicians from both parties have amplified that complaint, despite the assurances by the Bush administration that the company’s record checks out, and that the UAE is an ally in good standing in the war on terror.

New York Republican Congressman Peter King has insisted the administration revisit its approval of the transfer of control of U.S. ports to “a company coming out of a country where al Qaeda has such a strong presence,” and which could be easily infiltrated by the terrorist network. Democratic Senators Hillary Clinton of New York and Bob Menendez of New Jersey plan to hold hearings on the issue next week, and are seeking legislation banning companies controlled by foreign governments from buying U.S. port facilities. Menendez alleged that the UAE has a “serious and dubious history… as a transit point for terrorism.” And in response to Homeland Security secretary Michael Chertoff’s insistence that the administration made a rigorous check — without disclosing details — of the security implications of the deal, California Democratic Senator Barbara Boxer said “It’s ridiculous to say you’re taking secret steps to make sure that it’s okay for a nation that has ties to 9/11 to take over part of our port operations.”

But to call the United Arab Emirates a country “tied to 9/11” by virtue of the fact that one of the hijackers was born there and others transited through it is akin to attaching the same label to Britain (where shoe-bomber Richard Reid was born) or Germany (where a number of the 9/11 conspirators were based for a time). Dubai’s port has a reputation for being one of the best run in the Middle East, says Stephen Flynn, a maritime security expert at the Council on Foreign Relations. And Dubai Ports World, which is a relatively new venture launched by the government of Dubai in 1999, has a number of Americans well known in the shipping industry in its senior leadership. It operates port facilities from Australia through China, Korea and Malaysia to India, Germany and Venezuela. (The acquisition of P&O would give them control over container shipping ports in Vancouver, Buenos Aires and a number of locations in Britain, France and a number of Asian countries.) “It’s not exactly a shadow organization for al-Qaeda,” says Flynn. Dubai, in fact, was one of the first Middle Eastern countries to join the U.S. Container Security Initiative, which places U.S. customs agents in overseas ports to begin the screening process from a U.S.-bound cargo’s point of departure.

Dubai Ports World has been taken by surprise over the furor, and is reportedly sending its Chief Operating Officer, the widely respected American shipping executive Edward “Ted” H. Bilkey to Washington for talks. Indeed, the Bush administration needn’t wait for Bilkey to arrive; it could get a good assessment of the workings of Dubai Ports World from its own current nominee for the post of U.S. Maritime Administrator — Dave Sanborn, previously a top executive at Dubai Ports World.

In the talk-show furor over the transfer of P&O to Dubai Ports World, there has been little reference to the mechanics of port management in the U.S. Over 80 percent of the terminals in the Port of Los Angeles, for example — the biggest in the U.S. — are run by foreign-owned companies. U.S. ports are owned by State authorities, and the workers who actually offload the ships that dock there are the same unionized Americans who belong to the International Longshoremen’s Association regardless of which company hires them. Dubai Ports will not “own” the U.S. facilities, but will inherit the P&O’s contracts to run them, with no changes in the dockside personnel or the U.S. government security operations that currently apply to them.

See also: AJ Strata’s posts here and here, Macsmind (see also here)

Joe Gandelman has a link roundup of blogger reax.

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