February 24, 2006

The Substance of the UAE Port Deal Uproar

Carroll Andrew Morse

I am trying to keep an open mind, but I find the Bush administration’s defense of allowing a state run enterprise of the United Arab Emirates (Dubai Ports World), to purchase control of operations of six major American ports to be deeply unsatisfying. The emerging conventional wisdom -- the deal is acceptable on substance, but has been mismanaged politically -- is too forgiving towards the administration, excusing a lack of strategic vision that extends beyond politics.

Contrast the administration's handling of the Dubai Ports World deal, which impacts physical objects that cross the border, with its handling of electronic communications that cross the border. Several months ago, the public learned that the Bush administration had established a National Security Agency program for monitoring international telephone traffic. The administration justified this program because the country was at war, developing a doctrine of heightened Presidential power -- based on heightened Presidential responsibility -- created by the nexus of the President's Constitutional power and the Congressional Authorization to Use Military Force.

Yet when it came to the port deal, the idea of heightened executive power and heightened executive responsibility in this time of war suddenly vanished. Incongruously, the public learned that less scrutiny than usual had been applied to the official evaluation of the Dubai Ports World sale. The Associated Press describes a few provisions, usually standard, that were waived in this specific case...

In approving the purchase, the administration chose not to require Dubai Ports to keep copies of its business records on U.S. soil, where they would be subject to orders by American courts. It also did not require the company to designate an American citizen to accommodate requests by the government.

Outside legal experts said such obligations are routinely attached to U.S. approvals of foreign sales in other industries.

The administration tried to assure Americans that this was not a problem. The government of the United Arab Emirates had signed the proper, formal anti-terrorist paperwork and the current leadership of the UAE was an ally. The President tried making the case that having a UAE-based company running American ports was not any different from having a UK-based company running American ports…
Bush said he was struck by the fact that people were not concerned about port security when a British company was running the port operation, but they felt differently about an Arab company at the helm. He said the United Arab Emirates was a valuable partner in the war in terror.
It has all reeked of a pre-September 11 approach to foreign affairs. The key assumption of America’s post-Cold War but pre-September 11 foreign policy was that the domestic nature of other countries didn't matter, so long as our leaders got along with their leaders and their commercial elites made good business partners. Part of the everything that changed on September 11, many of us thought, was that the US had learned the limits of such a stark foreign policy. Economic and commercial ties, by themselves, could not be trusted to promote an international environment that enchanced American security.

The fact that business isn't everything in foreign policy doesn't mean that the port deal should be disallowed. It does mean that the President has to explain how this business deal squares with the ideals-based foreign policy framework he has sought to establish. It will be fatal to his program if the President is viewed as someone who preaches democracy to his domestic audience, but talks about "just business" when dealing with foreign elites.

The President must explain how this is more than just a good deal with the UAE at this specific moment. He must make the case that this is part of a larger program where, ultimately, the US expects to have a much greater effect on the UAE than the UAE will have on the US. And if such a statement cannot be made because of fears that it would kill the deal, then the Bush administration has to ask itself what the UAE's long term interest in this venture really is.

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Bush has kept the veto pen well out of sight for five years and now threatens to use it - over this no less!

This tells me that appeasing the middle east sheikdoms and mullahs directly, and the oil companies indirectly, is perhaps the most important concern of this administration. The reckless spending of Congress over the last five years never even rated a ceremonial lifting of the veto pen.

Posted by: bountyhunter at February 24, 2006 6:34 PM

He's TNT, he's Dynamite!
That's Laffey!! Laffey has the strongest policy on keeping us all safe. And he has the track record of taking on the issues.

He's TNT he's dynamite!
and he's ready to FIGHT! for you !!

Posted by: angusy at February 25, 2006 4:02 PM

I suppose the fact that Dubai Ports World already has operational facilities in Houston the same as what they are buying at these six ports has no weight in convincing you this issue is being blown up way out of proportion than is necessary, just as is the fact that they will not really be running the ports does either. Port control was, is, and for the forseeable future will be held by the U.S. Coast Guard and the D.P.S.

And if that doesn't hold water for you, I guess you would rather they not already be loading about half the containers being shipped into our ports in the first place.

Posted by: smmtheory at February 26, 2006 2:11 AM

Talking about fighting -

While Laffey fights for the taxpayers and for the safety of the populace, the Chafee people are apparently fighting for their own respect and sobriety.

Did anyone else hear or see that smackdown on Friday between Ian Lang and Steve Laffey? Get this - Lang actually called Laffey out, got in his face, and probably committed misdemeanor assault on the mayor. Apparently the hard cider at the follies got to him and he felt compelled to defend his honor in some kind of new age Aaron Burr style.

It looked as if Laffey handled the matter gracefully - dare I say Senatorially - with a comment seemingly expressing compassion for the poor guy and a plea for him to sober up before driving home.

If I had to constantly defend Chafee's positions and be forced to debate Laffey on the radio, I would probably be hitting the hard cider myself - with vigor. Now we know why his boss refuses to debate Laffey.

Posted by: bountyhunter at February 26, 2006 10:12 AM

smmtheory opines:

I suppose the fact that Dubai Ports World already has operational facilities in Houston the same as what they are buying at these six ports has no weight in convincing you this issue is being blown up way out of proportion

I suppose the fact that Bush has already allowed Osama's pals from the UAE access to our ports without anybody noticing makes it okay that he wants to give them even greater access.

CAM is right. Letting this deal go through contradicts everything Bush has told us about the need for extreme measures to fight the terrorists. A suspicious person might even be led to believe that Bush has just been blowing smoke the whole time, and that the whole "war on terror" has been nothing more than a political dog-and-pony show to keep the American people in a properly fearful state of mind.

But of course, that would be going too far.

Posted by: Isaac Asimov at February 26, 2006 12:15 PM

I wouldn't exactly call operations since 1990 in Port Houston as being a fact that this President Bush allowed Osama's buddies in UAE access to our ports without anybody noticing. Spare me your hysteria Isaac. I guess you are okay with Communist Chinese companies having the same access? They do, and I'd be willing to bet that happened in the time frame of 1992-2000. I wonder who was in charge when that happened.

Posted by: smmtheory at February 26, 2006 11:12 PM


Since going back to the Clinton era timewise means going back to a pre 9/11 mindset, I don't think you're exactly helping your case. "Clinton did it too!" doesn't make the country safer nor your argument necessarily wiser.

The non-existence of a proper public/political focus on port operations and security in the past doesn't mean we're secure; it could mean we've just been lucky.

Posted by: bren at February 27, 2006 11:06 AM

Are you also clamoring for divesting Chinese ownership? Please show me a link where anybody is calling for ending Chinese ownership as well. Because that person or organization is at least not acting hypocritically. Also please show me a link to bona fide information that shows the US Coast Guard is not in charge of security of our ports. And if the UAE firm can't be trusted to handle loading and unloading cargo, show me a link to whomever might be calling for stopping all shipping from entering the US via ship loaded by DPW or any other firm at a port in a Muslim majority country. If you can't do that then it doesn't matter whether I've hurt or helped my case as long as the hypocrits shut up their hysteria.

Posted by: smmtheory at February 27, 2006 1:23 PM

Look, normally I might say find your own links, but for what its worth, your 1st request was pretty easy -see below. Your other request was questionable since its been pretty clear that the Coast Guard is in charge of security and Dubai would focus on port operations.

I would agree with you that hysteria is not called for here, but we sure deserve the legally required 45 day review and a clearer explanation of the points raised in CAM's post.

You seem pretty knowledgable about current port operations. The rest of the country needs more information in order to make our own sound judgement.


"Hillary Clinton is to introduce legislation in the US which would block the take-over of P&O by Dubai Ports World...

Mrs Clinton's legislation would prevent US ports from being owned by any foreign government, but much of the concern in this case arises because DP World is owned by the government of the UAE."


"Meanwhile a group of senators including Clinton is offering a different bill that would ban any foreign governments from controlling operations at American ports."

Posted by: bren at February 27, 2006 4:58 PM

Also, given that the Coast Guard is in charge of port security, folks may find this report (partially declassified and released today by Susan Collins) of interest:


"WASHINGTON - Citing broad gaps in U.S. intelligence, the Coast Guard cautioned the Bush administration that it was unable to determine whether a United Arab Emirates-owned company might support terrorist operations, a Senate panel said Monday...

"There are many intelligence gaps, concerning the potential for DPW or P&O assets to support terrorist operations, that precludes an overall threat assessment of the potential" merger," an undated Coast Guard intelligence assessment says...

The document raised questions about the security of the companies' operations, the backgrounds of all personnel working for the companies, and whether other foreign countries influenced operations that affect security."

For me, this raises the question as to why the initial CFIUS review of the deal didn't trigger a major security concern. Is it a process or political flaw?

Posted by: bren at February 27, 2006 5:27 PM

And here is a link to a review by Powerline Blog which expounds on your US Coast Guard talking point. Hillary Clinton's bill to block foreign ownership of any port terminals would pretty much shut down all port operations from coast to coast. Some trade off... fortress America... nothing goes in, nothing goes out. I've had more than enough of her trying to foist economic ruination upon the US. So who would take over those nine ports being operated by the Saudi's? Who would take over the umpteen ports being operated by other foreign companies? Another US Government operation? Please spare me. The political flaw is the bad precedent being set by congress now... second guessing every decision made by agencies not under their supervision. Talk about power grabs.

Posted by: smmtheory at February 28, 2006 2:30 AM

There's a tendency by some to conflate state-owned companies with foreign companies, pre 9/11 decisions with post 9/11 decisions, and of course, the kicker: Arab countries to Arab countries with past ties to al Qaeda. Conversely, pretending port operations and security are mutually exclusive doesn't work either.

"Trust Us" is a non-informative argument as well.

These type of arguments don't serve the interests of people on both sides of the aisle who are trying to figure out this thing. These attempts come across more as propaganda or spin and raise more suspicion than support.

Raising concerns about economic alternatives re: port operations (or lack thereof), public control vs. privatization and balancing these concerns with security issues needs more scrutiny.

I haven't seen ANY response from deal supporters to the rationale for this:

"The administration did not require Dubai Ports to keep copies of business records on U.S. soil, where they would be subject to court orders. It also did not require the company to designate an American citizen to accommodate U.S. government requests. Outside legal experts said such obligations are routinely attached to U.S. approvals of foreign sales in other industries."

Posted by: bren at February 28, 2006 10:45 AM

For those such as yourself that have already prejudged significant security issues after the proper government agency has determined none exist, hardly anything I say will relieve your suspicion.

Which outside legal experts said that records obligations and US liaisons are routinely attached to US approvals of foreign sales in other industries? Why do you think those obligations are or are not attached? In most cases when sales to foreign interests are considered it is only US owned companies being considered. This is a case of a foreign owned company being sold to another foreign owned company. The US has no legal right to require any records be kept on US soil in a case like this. A US liaison is a moot point when the only people allowed to work in our ports are US persons, and union members to boot!

Who are those people on both sides of the aisle trying to figure this thing out? Democrats and RINOs? Security hawks my butt.

Posted by: smmtheory at February 28, 2006 12:59 PM

Well, thanks for 2 things in your last post:
1-The information on records obligations. If true, it is helpful info.
2-Your RINO comment, assuming you're talking about every Republican who's come out with concerns on this. I needed a good laugh.

Posted by: bren at March 1, 2006 1:10 PM