February 21, 2006
WHERE ARE ALL THE LOONY RIGHTIES DECRYING PROTECTIONISM? (via Gene Brown):
Paranoia about Dubai ports deal is needless (Financial Times, February 21 2006 )
The current furore in Washington about the takeover of P&O, the UK-based ports operator, by Dubai Ports World says more about the United States Congress than the United Arab Emirates. The bluster about national security conceals one of the uglier faces of US protectionism - the one with the slightly racist tinge.DP World, the mainly Dubai government-owned ports operator, paid top dollar, $6.8bn (£3.9bn), for P&O, part of its bid to build a worldwide network of maritime terminals with Dubai at its centre. The bold move was very much in character with the vaulting ambition of Dubai - one of the seven emirates in the UAE federation led by Abu Dhabi - and Sheikh Mohammed bin Rashid al-Maktoum, its restless ruler.
Dubai is the most dynamic of the glittering city-states that run down the east of the Arabian peninsula. It long ago decided to invest its (relatively modest) endowment of oil in other ways of making a living. So far, it has done very well. By creating excellent airport infrastructure and Emirates, one of the world's best and most profitable airlines, it seeded not just a regional but international air transport, transhipment and tourism hub. It has also become a regional financial and services centre. Oil revenue now amounts to only 7 per cent of Dubai's income, although it benefits from its federal ties with oil-flush Abu Dhabi.
Nationalist hysteria always renders bad policy decisions.
MORE:
Bush: Arab Co. Port Deal Should Proceed (BEN FELLER, 2/21/06, Associated Press)
President Bush said Tuesday that the deal allowing an Arab company to take over six major U.S. seaports should go forward and that he would veto any congressional effort to stop it."After careful review by our government, I believe the transaction ought to go forward," Bush told reporters who had traveled with him on Air Force One to Washington. "I want those who are questioning it to step up and explain why all of a sudden a Middle Eastern company is held to a different standard than a Great British company. I am trying to conduct foreign policy now by saying to the people of the world, `We'll treat you fairly.'"
Bush called reporters to his conference room on the plane after returning from a speech in Colorado, addressing a controversy that is becoming a major headache for the White House. He said the seaports arrangement was "a legitimate deal that will not jeopardize the security of the country."
It'll be amusing to see the law they try to write anyway. Are they going to take over the running of the ports themselves?
MORE/MORE:
Strife deepens over port security: From lawmakers to mayors, concerns are rising over a deal with an Arab port-management firm (Alexandra Marks, 2/22/06, The Christian Science Monitor)
"What we're seeing is a very unfortunate knee-jerk reaction in terms of the Muslim world," says Lester Lave, an economist at Carnegie Mellon University's Tepper School of Business in Pittsburgh, noting the United Arab Emirates is a key US ally in the Muslim world. "If you treat your strong allies this way - this is like a poke in the eye - then what in the world should people who are not our strong allies expect from us?"In past two years, the US has been negotiating a free-trade agreement with the UAE. Professor Lave agrees that security is important, but he believes it can be negotiated in the contract. Some homeland- security experts say the interagency review, which was led by the Bush administration's Treasury Department, may have provided even greater security guarantees than most international business deals do.
"In a weird way, the interagency review allows the US to hold international companies to a higher level of standards and accountability," says Frank Cilluffo, director of the Homeland Security Policy Institute at George Washington University. "There are some legitimate security concerns, but it's going to come down to enforcement, and arguably at a higher standard than we have had in the past."
Companies like P&O don't provide security at the ports. The US Coast Guard and Homeland Security's Immigration and Customs Enforcement do. For instance, in New Orleans, P&O is one of eight terminal operators responsible for marketing the port, signing agreements with shipping lines, hiring labor, loading ships, and moving cargo.
But P&O has no responsibility for security. "We have our own police force, harbor patrol, customs officers, and Coast Guard," says Chris Bonura, spokesman for the Port of New Orleans. "That won't change no matter who is operating the terminal."
Frist to Offer Bill Halting U.S. Port Deal (WILL LESTER, 2/21/06, Associated Press)
At the Pentagon, the UAE was praised as an important strategic military partner by both Defense Secretary Donald H. Rumsfeld and Gen. Peter Pace, chairman of the Joint Chiefs of Staff. Rumsfeld told that a process was in place and "the process worked."Posted by Orrin Judd at February 21, 2006 12:11 PM"Nothing changes with respect to security under the contract. The Coast Guard is in charge of security, not the corporation," Rumsfeld said.
"We all deal with the U.A.E. on a regular basis," he added. "It's a country that's been involved in the global war on terror...a country (with which) we have very close military relations."
Pace said that "military cooperation is superb" with the U.A.E.
I'm glad to see you're on the DW Ports side of the argument; way too many people are doing a knee-jerk Arab=Terrorist equation.
Posted by: Mark Byron at February 21, 2006 3:01 PMThis decision is bad politics compounded by the Bush administrations's poor communications skills. This will never go through.
Posted by: Rick T. at February 21, 2006 3:43 PMBush is threatening to veto any attempt to stop it. Anyone else think he knows something the rest of us don't?
Posted by: Timothy at February 21, 2006 4:03 PMAs a law school trained, entertainment professional with his own talk show (now 10 hrs/week - not brokered), I can attest to the fact that the adminstration is off it's rocker on this one.
Even taking into account any level-headedness that "OJ wisdom" might attach to this, the issue is poison for Bush. It is (Miers x 911,000).
Isn't OJ the one always asking how any Tory could let Blairites get "to the right of them" on an issue.
This is low hanging fruit for Hillary et.al. to garner "street cred" on terror. Even taking all reasoned opinions into account, this is evidence of some idiot crony asleep at the switch.
Bush ramming this through (or maybe even trying to) will get us that Dem. Congress OJ says is impossible.
Posted by: Bruno at February 21, 2006 4:14 PM"Bush veto threat?"
Oh Oh Ohhhhhhhhhhhhhhhhhhhhhhhhhh! That's Scary.
Posted by: Bruno at February 21, 2006 4:17 PMWhat's Congress going to do about it?
Posted by: oj at February 21, 2006 4:18 PMBruno:
Take a breath, huh? No one in voting America cares about who runs the ports -- did you lnow they were run by a foreign company yesterday -- and Congress can't stop the sale of a British company to Dubai.
Posted by: oj at February 21, 2006 4:27 PMDon't worry, we still control the Port of Catoosa.
Posted by: jefferson park at February 21, 2006 4:41 PMOJ,
I don't see Bush winning this one. Too many people speaking out on it on ALL SIDES. Not this soon after the cartoon jihad, anyway.
Posted by: Brad S at February 21, 2006 4:41 PMEven though the company that purchased it is but a mere management firm. An even greater threat, though, would be if some Mideastern country were to try to buy BAX Global. Talk about a threat that could not be countenanced:(
Posted by: Brad S at February 21, 2006 4:44 PMAnd it could be even worse: Remember Hutchinson Whampoa, the ChiCom front company operating the Panama Canal? It was a bidder for P&O.
Posted by: Brad S at February 21, 2006 4:46 PMOJ,
It isn't that I necessarily disagree with you on the subject matter, but I think you are wrong about the idea that this doesn't have any traction.
Again, I would be happy to be proven wrong, but I doubt that I am.
As for your question..
Yes, I knew that they were run by a British Co. and that the the UAE co. is buying them. So did my listeners, who, contrary to high-brow bloggers beliefs (like many of us here - me included), are quite informed, sophisticated, and intelligent. (see Pew Research)
I'm far more worried about the "dingbat security-mom" and their emasculated husbands, who are far more likely to be swayed by Dem and media attempts to use this as an easy issue to "get to the right of Bush" on security.
The fact that Snow sold CSX assets to the same UAE company before he left won't help. Try not to think about all those containers on CSX rails...(see Malkin)
Posted by: Bruno at February 21, 2006 4:46 PMBrad:
You still haven't gotten to the threshhold question: what is Congress going to do about it? Is Bill Frist going to run the ports himself?
Posted by: oj at February 21, 2006 4:47 PMThe Dems are being snookered yet again, this time with Bill Frist as bait. Brer Bush is one roping, doping tar baby, ain't he.
Posted by: ghostcat at February 21, 2006 4:47 PMMy guess, OJ: Try to run interference for that Miami-based shipping company suing to block the sale.
Posted by: Brad S at February 21, 2006 4:50 PMBruno:
You're inside the bubble though and you didn't know Brits ran them until this. The security stuff is a bogus trope and neither the Congress nor the Executive actually has a legal means to prevent this.
Posted by: oj at February 21, 2006 4:53 PMBrad:
Congress is going to interfere in a civil suit between corporations? That's the "conservative" solution here?
At least we don't have to listen to any of these folks whine about free trade anymore.
Everyone know the only people in the ports who matter are the ILWU guys. That the screechers are back and at full volume shows just how unserious and out of touch the pundit class has become.
This is all about forcing the Dem's contradictions (TM by oj) regarding terrorism and multiculturism. Bush wins either way.
Posted by: ghostcat at February 21, 2006 4:58 PMThe funniest part of all this is the claim that Brits, who perpetrated the 7/07 bombings, should be in control of US ports.
Posted by: oj at February 21, 2006 5:06 PMRacism, nationalism run amok OJ?
I thought you New Englanders were noted for your common sense? Bush is going to have his a** handed to him on this one. I hope it's a double large sized boot too because he still hasn't faced the music for inviting the entire S. American continent to take up residence here.
I'm tired of this "Third Way" nonsense. How 'bout the First Way? America first, everybody else form a line and so sorry about that self-esteem thing.
Posted by: NC3 at February 21, 2006 5:11 PMAmerica for the Americans, right NC3?
Posted by: Brad S at February 21, 2006 5:13 PM1. They're buying it with Arab money, which was our money.
2. If they sneeze we can freeze the assets ( got em by the Cojones).
3. when it comes to their money ports will be as safe from Islamic sabotage as it is walking down a city street with a number of Mafia related businesses on it. Not to worry.
4. They'll hold the paper, Western expertise will run the Ports.
5. Bush and Cheney are not running in 2008 (I love it).
6. Other than the one we shot down, how many Islamic owned airlines have been hijacked?
Genecis,
It's an EgyptAir 990 situation (in 2000) that I'm more worried about. The pilot was said to be in thrall to Islamism, and felt the urge to suicide-dive the plane into the Atlantic.
Posted by: Brad S at February 21, 2006 5:25 PMWell, you guys seem to have this covered. I'll just note again the beauty of paying foreigners in dollars. The only place you can spend them is here.
Posted by: David Cohen at February 21, 2006 6:17 PMWhere was the hew and cry when Carter gave away the Panama Canal?
Posted by: erp at February 21, 2006 6:24 PMI hear the second best bidder was a French company.
Posted by: ghostcat at February 21, 2006 6:29 PMYou guys obviously don't recognize a Rove/Cheney plot when you see one hatched before your eyes. The only company that will have the wherewithal to step up and manage these ports when the administration caves at the last minute is Halliburton! Heads will explode.
Posted by: The Other Brother at February 21, 2006 7:40 PMSpeaking of Dick Cheney, Inc, er, Halliburton, I have yet to receive my monthly check from them. Should I get on the "Beat up on Bush" bandwagon Michelle Malkin is leading, or should I just stay by the mailbox?
Posted by: Brad S at February 21, 2006 7:56 PMAccording to the GOP blog sites this deal will cripple Bush and the GOP and lead to enormous gains for the Dems in Nov '06. We'll see.
Posted by: AWW at February 21, 2006 11:17 PMFor what it is worth, I interviewed Steve Forbes re: flat tax on my show. I asked him about the ports issue upfront.
He basically toed the Rumsfeld line and said the people in charge of the security wouldn't change under any circumstance.
I wasn't about to argue with him but remain skeptical. This is akin to Hoover golfing while campaigning in a recession and thinking he was fine because of a telephone poll (which would skew the audience in 1928).
As for Rovian plots, this could be a ruse to get various congressmen cover to seperate from Bush, but it's still 100 tone deaf.
Posted by: Bruno at February 22, 2006 12:31 AMAWW:
I've been thinking about this, and while at first it seems politically naive for Bush to take this particular line, one has to wonder if the Democrats are in a position to do anything with it. Considering their vaunted "tolerance" and the wishes of their base, are they going to actually argue that we ought to reject this deal solely because the company involved is Arab?
Posted by: Matt Murphy at February 22, 2006 3:56 AMBruno:
You sound like the libertarians who thought steel tariffs would sink him or the Leftists who thought Cheney was gone last week. No one cares outside the bubble.
Posted by: oj at February 22, 2006 7:33 AMMatt - I've heard a bit of this (Dem hypocrisy re profiling, Bush is too strong on security to be tagged with this, etc) but it isn't the dominant MSM theme. My fear is that, like Katrina, a soundbite story analysis that is anti-Bush will develop and calcify before Bush can respond effectively.
Posted by: AWW at February 22, 2006 8:44 AMOJ,
Interesting critique, since I knew what Bush was doing re: tariffs and found the Cheney stuff a silly distraction.
My view is that this situation is different, and that the left will gain a tidbit of traction on it.
Is Bush perfect? Is there no understanding of a good portion of the electorate here? Isn't it possible that he who lives by the Jacksonian tide may die by it if they are not careful?
Again, no real reason to belabor the point. I just don't see this as a tempest in a tea cup. I'd be happy if it turned out that way.
Posted by: Bruno at February 22, 2006 9:23 AMBruno:
It's not. Are Republicans going to join Democrats in nationalizing port operations? Think business is going to be okay with a bill of attainder against this one port operations company? Think Wal-Mart will be okay with that idea?
Posted by: oj at February 22, 2006 9:43 AMBush is not up for re-election nor is his VP, at the moment.
It hurts me to say: What port security? Maybe this will be the catalyst to get that area covered. Congress is still shopping on that one.
What I'm really curious about is what Gore will say about this?
Posted by: Genecis at February 22, 2006 12:34 PMAWW:
If the story is just about him, though, it's probably not so bad -- he's not up for re-election. Ultimately, in order to take advantage of this, the Democrats would have to take the opposite position; otherwise, what's the purpose of voting against the GOP when the Dems will give you more of the same?
Posted by: Matt Murphy at February 22, 2006 3:12 PM