The administration’s ‘conditions’ to the UAE deal

February 23, 2006

As part of an effort to convince Congress and the public that it really was on the ball on the whole port deal, the administration leaked word yesterday that it had included all kinds of secret conditions to the Dubai Ports contract that would further protect U.S. interests. There are, however, a couple of catches.

The Bush administration secretly required a company in the United Arab Emirates to cooperate with future U.S. investigations before approving its takeover of operations at six American ports, according to documents obtained by The Associated Press. It chose not to impose other, routine restrictions.

As part of the $6.8 billion purchase, state-owned Dubai Ports World agreed to reveal records on demand about “foreign operational direction” of its business at U.S. ports, the documents said. Those records broadly include details about the design, maintenance or operation of ports and equipment.

A Wall Street Journal report added that administration officials “obtained extra security commitments from Dubai Ports World,” which offered “safeguards” and “more intense scrutiny.”

Sound good? Well, maybe. The same secret requirements said Dubai Ports would not be required to keep copies of business records on U.S. soil, where they would be subject to court orders. As Josh Marshall put it, “The failure to require the company to keep business records on US soil sounds like a pretty open invitation to flout US law as near as I can tell.”

For that matter, the administration-negotiated conditions also said the company did not have to designate an American citizen to accommodate U.S. government requests, which apparently is a break from the standards usually applied to U.S. approvals of foreign sales.

But I have an even more basic question about these conditions. The administration leaked word of the side deal yesterday to help prove the Bush gang is on top of things. But don’t these conditions undermine the rest of the White House talking points? If the Dubai Ports World deal was a routine business arrangement that raised no national security concerns, as Scott McClellan insisted yesterday, why did the administration “obtain extra security commitments”?

In other words, the president personally argued this week that there’s no reason in the world we should hold a Middle Eastern company “to a different standard than a Great British company.” If that’s true, what was the motivation for the administration insisting on extra safeguards from the United Arab Emirates?

Cut it out, Steve, you’re not supposed to think so hard.

  • Follow the money. Some crony is going to make money off this deal. Who benefits?

    Clearly this is not an ordinary deal. Secret provisions and a veto threat argue otherwise.

  • Gak!

    The White House is spinning out of control.

    The NPR pointed out this morning that no American Company of any size exists that handles port operations. Which is interesting because Dubai World Ports was bought lock, stock and barrel from Secretary Snow (I think the company name was CTX). So basically we sold off all the American companies that hand the expertise to manage our ports.

    Maybe we should just buy them back?

  • Nouriel Roubini pointed out a key aspect of this, which has received no attention anywhere else:

    “with a US current account deficit running towards $900b this year and probably above one trillion $ next year, in a matter of a few years foreigners may end up owning most of the U.S. capital stocks: ports, factories, corporations, land, real estate and even our national parks. This is basic accounting: if you run a current account deficit (import more than export, spend more than your income, save less than you invest) you need to borrow from the rest of the world to finance such excess of spending (on private and public consumption and investment) over your national income.”
    http://web20.rgemonitor.com/blog/roubini (I think this is outside the site’s sub wall)

    Right now, we have the luxury of asking whether we should have one foreign owner or another own our ports. After another few years of massive current account deficits, a direct result of the Bush/Frist/Hastert/DeLay fiscal deficits, we won’t have that luxury.

  • “Right now, we have the luxury of asking whether we should have one foreign owner or another own our ports. After another few years of massive current account deficits, a direct result of the Bush/Frist/Hastert/DeLay fiscal deficits, we won’t have that luxury.” — CB

    So we are either hoping for the Rapture to come…

    …or we are going to pass a law nationalizing all foreign investments, then selling them to private US interests 😉

    The only problem being, by the time Bush’s sucessor puts the plan into effect, there will be NO AMERICANS with the competence to actually run this country’s economy.

  • Makes me feel very safe knowing key and critical business records, like, say, port plans and schematics, security diagrams and reports and studies, incident reports, and the like will be kept in the UAE. Those sorts of documents would mean absolutely nothing and be of no help whatsoever to “terraists” and “suiciders”, no?

  • The point BC makes is really frightening.
    Sort of a “They are US” kind of thing, or
    something. How close is this doomsday
    scenario to reality, anyway?

  • Everyone better make sure their computers are equipped with Chinese fonts.

    In spite of having been through Latin, Greek, Spanish, and (recently) Italian – I’m not going to count the PhD requirements in scientific French and German – I’m too old to learn the new, for-me-exotic, and soon-to-be-required, Asian language.

  • Now is an exceptional opportunity for the democrats. Please be vicious as good opportunities like this don’t come around too often and peoples lives hang in the balance. As you are well aware, President Bush want to allow the ports of this country to be sold to the UAE. He assures us:

    “This wouldn’t be going forward if we weren’t certain our ports would be secure,”.

    Please do not allow the President to skate when his credibility has already been undermined. Please ask the President if we are as certain that the ports will be secure as we were that there were WMD’s in Iraq. Ask him why this assurance can be trusted more than the WMD assessment for Iraq. Here is a quote from October 8, 2002:

    Some ask how urgent this danger is to America and the world. The danger is already significant, and it only grows worse with time. If we know Saddam Hussein has dangerous weapons today — and we do — does it make any sense for the world to wait to confront him as he grows even stronger and develops even more dangerous weapons?

    Please remind the people that this President’s assurances cannot be accepted on face value alone. We need to know why we should trust him when he mislead us once already. You might point out that these are new and trying times with a growing threat from terrorism and we would not want reckless and lax policies for the ports to be marked by a mushroom cloud in one of our port cities.

    • Comments are closed.