White House faces storm of protest over Dubai port deal
What was a brushfire last week over the proposed sale of a British company’s U.S. port leases and facilities to the Dubai port authority erupted into a political wildfire Monday as the controversial deal became the hot topic of television news and cable programs focused on the homeland security implications of a foreign government operating port facilities in the United States.
London-based Peninsular and Oriental Steamship Navigation Co. has agreed to sell its ports division to state-owned Dubai Ports World for $6.8 billion. P&O Ports operates 29 ocean terminals around the world, including several in the United States. The company’s major terminals are in Philadelphia, Baltimore, Miami and New Orleans. It has a half-stake in a terminal at the Port of New York-New Jersey and smaller operations in Beaufort and Corpus Christi, Texas, and elsewhere.
The sale was quietly approved by a Cabinet-level committee that meets to make sure foreign investments do not jeopardize national security.
Dozens of senators and congressmen have called on President Bush to cancel approval for the contract or launch a complete 45-day investigation into the matter, as permitted by law.
There has yet to be a single member of Congress so far who has publicly defended the port transaction or the Bush administration’s process for reviewing it, and news coverage about the issue Monday was overwhelmingly negative. TV commentators took turns bashing the Bush administration for “outsourcing” national security to a country they said had ties to terrorism because money for the Sept. 11, 2001 hijackings was funneled through banks in the United Arab Emirates and a few attackers passed through the country.
On Sunday, Homeland Security Secretary Michael Chertoff said the Committee on Foreign Investment in the United States, of which DHS is a part, built in conditions covering port security before approving the sale to DP World.
But Rep. Peter King, R-N.Y., chairman of the House Homeland Security Committee told CNN he is not satisfied that those conditions are meaningful.
“I’ve been told what those safeguards are and quite frankly those safeguards would only help if we could have absolute faith in the company itself,” he said.
Many legislators have complained about what is a secretive process and what criteria were used to validate DP World. Under the 1988 law that created the foreign investment review process, the executive branch decisions are typically kept classified in part to protect the flow of investment from foreign entities that might balk at making deals if their corporate laundry was aired in public.
Members of Congress from both parties say they no longer are willing to accept assurances from the administration at face value.
Sen. Robert Menendez, D-N.J., held a press conference at the Port of New Jersey Tuesday to denounce the port sale and said later on CNN, “You can’t just simply tell us: ‘Trust us.’ We trusted the government in its response to Hurricane Katrina and the people of the Gulf region were left out there largely on their own.”
Menendez plans to introduce legislation prohibiting foreign governments from owning port facilities in the country.
Chertoff’s predecessor at DHS, Tom Ridge, on the same network urged the White House to be more transparent and explain why the deal makes sense from a security standpoint.
“I do think at some point in time you do have to say to yourself, would Secretary Rumsfeld, and Snow, and Chertoff and Rice compromise American security? I don’t think so,” said Ridge, one of the few voices Monday not attacking the administration for its decision.
Mayors and governors who represent some of the six ports where terminals would change hands are also criticizing the DP World acquisition and looking for ways to block it.
New York Gov. George Pitaki and Maryland Gov. Robert Ehrlich, both Republicans, expressed concern about the transfer of port facilities in their states to a foreign-government controlled company, according to the Associated Press.
Pitaki said he has directed the Port Authority of New York and New Jersey to explore the possibility of canceling P&O Ports 30-year lease at the Port Newark Container Terminal to block that property from changing hands.
Ehrlich complained that the Bush administration did not notify local authorities before they approved the sale to DP World, and said he is studying options to void P&O’s contract to provide cargo handling service at the Seagirt and Dundalk terminals in Baltimore.
But last week, Ehrlich’s hand-picked head of the Maryland Port Administration, sounded comfortable with the DP World sale, according to wire reports.
“What we are talking about is stevedore and terminal operators that are contracted to various ports or steamship lines to operate terminals. They don’t own the ports, they are a tenant and the ports still control entry into their ports. I don’t believe that is an issue,” he said.
Baltimore Mayor Martin O’Malley, who is running against Ehrlich for governor this year, announced his opposition to the sale on Sunday. Montgomery County Executive Douglas Duncan, also a Democratic candidate for governor, spoke out Monday against the port sale.
Meanwhile, the White House continues to say the deal is done and it won’t revisit its decision, according to NBC. President Bush was unaware of the port transaction until he heard reports of the congressional uproar, presidential adviser Dan Bartlett told CNN.
A Dubai Ports World spokesman told the network that the firm has received all the necessary regulatory approvals, and that the security systems in place at the ports would only get better under the new management.
“All DP World ports are (International Security Port System) certified, as are any P&O ports in the U.S.,” the spokesman said. “We intend to maintain or enhance current security arrangements, and this is business as usual for the P&O terminals.”