Bush mounts late defense of port sale
The White House admitted Wednesday that President Bush was not informed about the administration’s decision to approve the sale of U.K. port operator P&O’s U.S. facilities to Dubai Ports World until after the move became a political controversy a few days ago, and that it should have briefed Congress sooner about the deal.
The president faces an outright rebellion from Republican leaders and the rest of Congress, which continued to move forward with plans to slow or halt the transfer of terminals to the Dubai state-owned company. But Sen. John McCain became the first member of Congress not to pile on the bandwagon opposing the sale since news about its approval became public last week.
McCain called on everyone to tone down the rhetoric and not rush to judgment that security at U.S. ports is jeopardized by DP World operating port facilities in the United States until Congress meets with administration officials and is assured that all security factors were considered in issuing approval for the sale.
“The president’s leadership has earned our trust in the war on terror, and surely his administration deserves the presumption that they would not sell our security short. Dubai has cooperated with us in the war and deserves to be treated respectfully,” McCain said in a statement.
Meanwhile, Democratic Sen. Charles Schumer and Republican Rep. Peter King, both from New York, announced plans to introduce a bill Monday to block the $6.8 billion sale and rush it to a vote.
The bill would place an immediate stay on the DP World takeover, and require the administration to open a 45-day investigation into the security implications of the sale and then provide Congress with a full report and briefings on its determination. Congress would have the authority to disapprove the sale within 30 days.
Schumer is one of the original opponents of the sale, and has said he doubts any investigation would satisfy his concerns with having the government of Dubai managing domestic commercial port facilities.
He sent a letter to Bush Wednesday asking the president for answers about the security criteria that were evaluated, why the administration did not opt for a more rigorous review and what types of lobbying efforts were made in support of the sale.
The White House is not backing down from legislative threats to stop the port sale, but is stepping up briefings on Capitol Hill to try and alleviate any concerns.
Spokesman Scott McClellan said the administration still has no plans to extend its investigation of the DP World transaction, setting up a likely clash when Congress reconvenes next week. McClellan added that the only way the case can be reopened is if false or misleading information was provided, or important information omitted, during the review process.
The White House did acknowledge it could have done a better job educating Congress about the P&O ports sale to defuse any potential discontent.
“I mean, in hindsight, when you look at this and the coverage that it’s received and the false impression that it has left with some, we probably should have briefed members of Congress about it sooner,” McClellan said Wednesday.
“And we are talking with members of Congress about it. There were some briefings last week. I know there are some additional briefings occurring today and there will be some additional briefings in the days going forward, so that they can have a full understanding of the facts, because when you look at the facts, we believe it should be clear to people that all the national security issues were addressed during this review process that was mandated by Congress. That is our top concern, the safety and security of the American people. And that’s why it goes through a process like this.”
Although not notifying the president about the port sale fits a pattern of Mr. Bush staying out of the loop on many decisions, it is par for the course when reviewing the national security implications of foreign investments. The interagency Committee on Foreign Investment in the United States (CFIUS) did not elevate the review of the DP World acquisition to a full investigation because it was satisfied the deal did not pose a threat after a shorter 30-day review period. Under the law, the committee is only required to pass its recommendations to the president for a determination when it conducts an additional 45-day examination to address heightened security concerns.
McClellan said President Bush, after learning about the controversial sale, checked to make sure that no department represented on CFIUS had dissented in the decision to approve.
“Each and every one expressed that they were comfortable with this transaction going forward,” he said.
Congressional opposition to the DP World investment is shaping into two camps. One group is intent on blocking the sale because many of the politicians see the fact that a few Sept. 11, 2001 hijackers used the United Arab Emirates as an operational and financial base, and that some nuclear components were illegally transshipped through the port there, as evidence that a DP World managed port could be easily infiltrated by terrorists seeking to attack the United States.
The other camp is raising objections about the process for reviewing the sale, saying that the CFIUS review process was done in secret and that Congress deserves to understand how the decision was reached before allowing the sale to move forward.
Sen. Majority Leader Bill Frist Tuesday said the CFIUS review process needs to be more transparent and include a role for Congress because the original law ceded all review power to the executive branch.
The Senate Banking Committee will hold a hearing March 2 to examine the sale and the process for reviewing foreign investments that have national security implications.
The Banking Committee held hearings last year because of concerns that arose about the review process related to a Chinese oil company effort to buy Unocal.
“It’s a deficient process in terms of transparency and congressional oversight,” Banking Committee spokesman Andrew Gray said in an interview.
In the case of DP World, “we weren’t made aware of it until late in the process and nobody knows what national security considerations were taken into account due to the secretive nature of the process. The process is flawed,” he said.
Congress is likely to consider legislation to reform CFIUS this year, Gray said.
At the White House, McClellan said many people complaining about selling domestic port facilities to a foreign government-owned company are under the false impression that the company will control security throughout the port.
“If this transaction were blocked, this would not change port security one iota. The Coast Guard and the Customs and Border Patrol remain in charge of our security. The Coast Guard remains in charge of physical security. The Customs and Border Protection remains in charge of cargo security. And there are a number of safeguards and security measures that we have put in place to make sure that cargo is screened before it reaches our shores,” he said.
The Bush administration stepped up efforts to counter charges that the UAE has ties to terrorism, saying the Persian Gulf nation is one of the United States’ strongest allies in the region, and the fight against terrorists. Administration officials pointed out that the country houses U.S. military bases that are supporting war efforts in Iraq and Afghanistan.
A White House fact sheet noted that the UAE hosts more U.S. Navy vessels than any other country outside the United States. The Jebel Ali port operated by DP World provides excellent service to the Navy, it said.
Retired Army Gen. Tommy Franks, the commander who led the invasion of Iraq in 2003, said on FOX News last night that Dubai’s Jebel Ali port is the finest he has seen in the world and has the capacity to serve the U.S. fleet.
Officials also pointed to the UAE’s role in stopping terrorist financing and money laundering through its banking system and supporting the fledgling Iraqi government.
In addition to McCain’s call for calm, a few lonely editorial voices popped up supporting Bush’s decision to let DP World’s investment in P&O go through. The Wall Street Journal, Washington Post, Los Angeles Times and Financial Times all published strong editorials Wednesday ridiculing Congress for trying to paint the UAE as a terrorist haven that will undermine port security.
“None of the U.S. politicians huffing and puffing seem to be aware that this deal was long in the making, that it had been reported on extensively in the financial press, and that it went through normal security clearance procedures,” the Post wrote.
“The London subway bombings last year were perpetrated by citizens of Britain, home to the company (P&O) that currently manages the ports that Dubai Ports World would take over,” the Journal noted. “The notion that the Bush administration is farming out port “security” to hostile Arab nations is alarmist nonsense.”
The Los Angeles Times wrote: “To be fair, congressional calls for transparency in the bidding process make sense. And any attention paid to port security is better than none at all. But by focusing on the nationality of a respected ports operator, instead of scrutinizing questionable policies or providing tangible suggestions for making the nation safer, members of Congress have once again shown their unerring knack for irrelevance when it comes to matters of homeland security.”
“The bluster about national security conceals one of the uglier faces of U.S protectionism — the one with the slightly racist tinge,” the Financial Times said in its editorial.