Friday, March 10, 2006

Bye Bye, to Dubai

And I'm not happy about it. For those of you who know my feelings on the Ports issue, those feelings haven't changed. I'm entrenched with my President, Curt, and Mike's America on this. I may stand amongst the minority, but I don't think I am wrong in my understanding of why this transaction was so much to do about nothing in the end. Here's an editorial from the LA Times today:

Goodbye, Dubai
March, 10 2006

PROTECTIONISTS, REJOICE! The dastardly United Arab Emirates company that would have presumed to unload containers of underwear and toothpaste on U.S. soil has backed down, and it will now divest its U.S. port interests to an American entity. Rest assured, the nation is now safe from dangerous Middle Eastern accountants and port logistics specialists.

Dubai Ports World did what was necessary, if not necessarily fair, on Thursday by agreeing to give up the U.S. operations of its newly acquired British ports company. The House Appropriations Committee had voted 62 to 2 on Wednesday to block the deal; a similar bill was pending in the Senate.

Although President Bush rightly stood by the acquisition and vowed to veto any bill that stood in its way, he was fighting a losing battle that only deepened a growing rift in the Republican Party. Dubai Ports World officials wisely recognized that they had to put some distance between themselves and their new U.S. assets. The company probably will sell its U.S. assets or create a U.S. company with a separate board to run them.

Much as we wish it would go away, the fight may not be over yet.

For one, the terms of the divestiture remain unclear, and some members of Congress are demanding more details. Will it be enough for Dubai Ports World to create a U.S. subsidiary? Will it have to open headquarters in the United States? Pay its employees in dollars?

For another, the flurry of disastrous bills the deal has inspired may yet find their way into law. Besides efforts to block the U.S. portion of the Dubai Ports World transaction, these include bills that would damage trade relations even further by restricting other foreign companies from taking over port operations. This despite the facts that such operations are dominated by foreign companies, that the bulk of the workers who actually load and unload containers are American longshoremen and that these companies have nothing whatsoever to do with port security, which is handled by U.S. government agencies such as the Coast Guard and Customs.

One has to wonder where this will end. Should a Saudi-owned airline be denied landing rights in the United States because most of the 9/11 hijackers were Saudis? That's the logic used by opponents of the Dubai Ports World deal, who fret that two of the hijackers came from the UAE and that its government supported the Taliban before the invasion of Afghanistan. Never mind that the UAE is a key ally and a hub for U.S. military operations in the Middle East.

The Dubai Ports World fiasco is unfortunate and embarrassing on many levels. But the damage can be contained as long as Congress does not start treating every private transaction involving ports the way it treats any deal involving defense contractors. (Foreign companies often must create a U.S. subsidiary to get business from the Pentagon — which makes sense, given that they are directly involved in U.S. security in the way that port operators aren't.)

It's true that keeping the United States secure in an increasingly globalized economy is a delicate balancing act. But members of Congress should realize that boosting trade with Middle Eastern countries is crucial to defusing tensions in the region and improving the U.S. image there. By that standard, this deal was a no-brainer — to go forward.
The popular opinion is not always the right opinion. I have problems with those critical that President Bush did not know far in advance of the ports deal, as if this is something unusual. This only became a big deal because people made it into such. The Ports controversy was a mid-level management issue. Presidents need to lead and not try and micromanage everything. Buried in there are some legitimate concerns, but they are out of proportion and out of touch with the bigger picture.

Also go to Flopping Aces for Curt's latest; and Mike's America on his reaction to the deal gone dead. You can see all of Curt's previous port posts by clicking here.

A very thoughtful post from Miss Chatterbox.

Washington Post has a good article on just how deeply embedded foreign investments are in our ports.

Also California Conservative has some things to say[quoting Newsmax]....

The source said that Dubai’s royals were “furious” at both Republicans and Democrats over the rebuff.

At stake are two major U.S. bases in the UAE. The port of Jebel Ali docked over 500 Navy warships last year, and played host over 70,000 American troops.

The Air Force flies reconnaissance and refueling missions out of the Al Dahfra airbase, which played a critical role in the air wars over Iraq and Afghanistan.

Bill Reinsch, president of the National Foreign Trade Council, said the ports episode would make it harder for Bush to accomplish his goals in the Middle East.

“The message is that we’re not distinguishing between countries that help us in the war on terrorism and countries that don’t. So the obvious question is why cooperate with the United States, if we’re going to treat you as a terrorist anyway?” Reinsch said.
And two comments that Skye left at Mike's America:

The chairman of Israel's largest shipping firm STRONGLY ENDORSED the DPW deal. "During our long association with DP World, we have not experienced a single security issue in these ports or in any of the terminals operated by DP World," Zim Integrated Shipping Services CEO Idon Ofer said in a letter to Senator Hildebeast Clinton (D-NY) written February 22. The letter goes on to state: "We are proud to be associated with DP World and look forward to working with them into the future."

Israel doesn't have a problem with DPW, why do you? [This in response to a commenter who refused to support the Dubai transaction of anyone who does not recognize the state of Israel-W of N]

Anyone else note the downturn in the stock market after the announcement the DPW was withdrawing their offer?

This is just the beginning of a maelstrom of backlash against the US economic interests.

The UAE is the hub of Middle Eastern shipping and banking. Last year alone, US companies shipped goods worth 8.5 BILLION dollars to the UAE.

The Democrats, MSM and spineless Republicans have put US citizens in physical and economic peril by killing this deal. Bravo! Well Done! OBL is soo proud of you.


Blogger Little Miss Chatterbox said...

Very well said and thanks for the link.

For me this has been a great lesson on why knee-jerk reactions aren't good. My initial thought was this sounded awful. But then I heard people who I really respected, who had researched start to share their info. So I knew I needed to take a step back and really look at the issue.

I was disappointed that a lot of bloggers had such knee-jerk reactions also. And it was interesting to me that 2 of the bloggers that had the best thought out posts on it were both Navy guys. Which obviously stands to reason that they would know a little bit more about this issue than the average joe.

I agree wholeheartedly with this post. Good job!!

Friday, March 10, 2006 11:03:00 PM  
Blogger Gayle said...

I kept thinking it would be proven that Bush knew what he was doing. Now we shall never know.

Saturday, March 11, 2006 5:50:00 AM  
Blogger Curt said...

Lil Miss, I couldn't agree more. When I first heard about it I was pissed....typical knee-jerk reaction. But after reading about it and getting all the information I could I understood why this deal needed to go through.

Quite sad to see those who are usually quite level-headed take such a extreme and harmful position on this case.

Saturday, March 11, 2006 3:29:00 PM  
Blogger Assorted Babble by Suzie said...

I am with you....Maybe b/c I have been listening to this for weeks...from all sides. Great post btw....

Monday, March 13, 2006 7:43:00 AM  

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