Port sale flap: can we trust the Arabs?

Much of the flap about a Dubai government-owned company has been framed around the fact that the firm involved is an Arab business. That does not appear to be the real problem.

John Nichols, writing in The Nation, states that the problem is that Dubai Ports World is a corporation. Ports are vital parts of U.S. infrastructure, he says, and are best operated by public authorities that are answerable to elected officials and the people the officials represent.

Following the national trend of “privatization” of city services, traditional port authorities have been minimized by various schemes that have permitted corporations to take over more and more of the basic operations of the nation’s ports. Many of these corporations are strongly anti-union and highly profit-oriented.

Since the attacks of 9/11, the federal government—despite its claims—has done little or nothing to beef up security at our ports. Shifting control of the six major ports from Britain’s Peninsular and Oriental Steam Navigation Co. to Dubai Ports World, will not improve the security situation, Nichols said.

Even now, said Sen. Daniel Inouye, D-Hawaii, the Bush administration doesn’t take port security seriously. “It has consistently submitted inadequate funding requests and has routinely missed critical security deadlines that were required by law.”

The administration said it has strengthened port security since 9/11 and notes increased funding and new security technology.

Security concerns have cropped up because operation of these ports would be carried out by a company owned by a Mideast government. Another little reported fact in the proposed deal is that Dubai Ports World also would operate the ports of Beaumont and Corpus Christi in Texas. Through these ports, according to the journal Army Logistician, “Almost 40 percent of the Army cargo deployed in support of Operation Iraqi Freedom flows.”

That means the sale of operating rights would give the United Arab Emirates, a country known as “a key transfer point for illegal shipments of nuclear components to Iran, North Korea and Libya” direct control over sizeable quantities of U.S. military equipment.

“It’s particularly troubling that the United States would turn over its port security not only to a foreign company, but a state-owned one,” said Rep. Tom Reynolds, R-N.Y., chairman of the National Republican Campaign Committee.

Some see the uproar over such moves as holding signs of a psychological operations (psyops) program in action, exploiting racial animosity toward Muslims and Arabs.

Nichols notes that most Arab-owned companies are focused on making money, just as American firms are, and most of them are not about to jeopardize profits by aiding terrorists. Also, he said, Arab companies are concerned more about pleasing their shareholders than anything else and, consequently, are poor keepers of ports and other parts of national infrastructure that need constant investment of public monies and responsible oversight by public authorities.

“The more you look at this deal,” said Sen. Charles Schumer, D-N.Y., “the more the deal is called into question. Schumer claims the deal was rubber-stamped in advance, before the Dubai company agreed to buy the British firm.

In part, that accusation stems from connections between Dubai and the White House. One is Treasury Secretary John Snow, who heads the federal panel that blessed the $6.8 billion sale. Snow is the former chairman of the CSX rail company that sold its international port operations to DP World for $1.15 billion in 2004, a year after Snow left to join Bush’s cabinet.

The other link is David Sanborn, who runs DP World’s European and Latin operations and was named last month by Bush to head the U.S. Maritime Administration.

“It always raises flags,” said Rep. Vito Fossella, R-N.Y., when administration officials have ties to a company.

And guess who has been guiding DP World through this multi-million dollar deal? None other than former Sen. Bob Dole. Dole’s wife, however, is not in favor of the transaction. Sen. Elizabeth Dole, R-N.C., wrote in a letter to Sen. John Warner: “I am deeply concerned that the proposed transfer of seaport operations to a company controlled by the United Arab Emirates government might compromise our ability to effectively control our ports and harbors.” Warner is chairman of the Senate Armed Services Committee.

Reporter David Sirota, writing on truthout.org, said the security issue is more or less a smokescreen, that the real heart of the deal is “free” trade. Sirota said the administration is in the midst of a two-year drive to reach a corporate-backed agreement with the UAE. Robert Zoellick, in 2004, travelled to that country on behalf of President Bush to open negotiations on the trade pact.

Daniel Griswold, director of the Center for Trade Policy Studies at the Cato Institute, a Washington think tank, said: “The United States’ trade relationship with the UAE is the third largest in the Middle East, after Israel and Saudi Arabia. The two nations are engaged in bilateral free talks that would liberalize trade between the two countries and would, in theory at least, allow companies to own and operate businesses in both nations. There are legitimate security questions to be asked, but it would be a mistake and really an insult to one of our leading trading partners in that region to reject this commercial transaction out of hand.”

Joshua Holland, writing on alternet.org, said the issue here is democracy versus corporatism. He said the U.S., European Union and Japan have been pushing for a deal on government procurement that would bring the public purchasing of goods and services under the World Trade Organization umbrella. The goal, he said, is to give foreign-based multinationals “national status.” That means, under WTO rules, that governments could not favor domestic firms over foreign companies for any reason (except security issues).

Customs and Border Protection oversees the handling of cargo that arrives daily at U.S. ports. It shares security obligations with the Coast Guard, terminal operators and state and local port authorities.

DP World’s Chief Operating Officer, American Edward Bilkey, told the AP his company will do whatever the Bush administration asks to ensure shipping security and promote completion of the sale of port operations. Bilkey said he will spend time in Washington in an effort to persuade legislators to allow the deal to go through.

“We’re disappointed,” Bilkey said. “We’re going to do our best to persuade them that they jumped the gun. The UAE is a very solid friend, as President Bush has said.”

According to a National Public Radio report, Dubai is one of the three nations that gave diplomatic recognition to the Taliban. Several of the 9/11 attackers held Dubai passports.

From the March 1-7, 2006, issue

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