The controversy over the sale of P&O to DP World took a high-tension tone after George Bush drew a line in the sand with Congress. He defended the decision by CFIUS to approve the transfer of port management to the nationalized UAE operator, and threatened to cast his first veto to save the deal from an increasingly hostile Congress:

Brushing aside objections from Republicans and Democrats alike, President Bush endorsed the takeover of shipping operations at six major U.S. seaports by a state-owned business in the United Arab Emirates. He pledged to veto any bill Congress might approve to block the agreement.

The president on Tuesday defended his administration's earlier approval of the sale of London-based Peninsular and Oriental Steam Navigation Co. to Dubai Ports World, despite concerns in Congress it could increase the possibility of terrorism at American ports.

The sale — expected to be finalized in early March — would put Dubai Ports in charge of major shipping operations in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia. "If there was any chance that this transaction would jeopardize the security of the United States, it would not go forward," Bush said.

"It sends a terrible signal to friends around the world that it's OK for a company from one country to manage the port, but not a country that plays by the rules and has got a good track record from another part of the world," Bush said.

To assuage concerns, the administration disclosed some assurances it had negotiated with Dubai Ports. It required mandatory participation in U.S. security programs to stop smuggling and detect illegal shipments of nuclear materials; roughly 33 other port companies participate in these voluntarily. The Coast Guard also said Tuesday it was nearly finished inspecting Dubai Ports' facilities in the United States.

Bill Frist has come out in opposition to the deal, claiming at one point that he has the votes to override a presidential veto -- which would be the first ever cast by this administration. He doesn't appear to be bluffing, either. Both Hillary Clinton and Charles Schumer agree with Frist, and House Speaker Dennis Hastert has asked the president to reconsider. Republican and Democratic governors have publicly opposed the deal, with Jon Corzine and George Pataki threatening to sue to stop it. Under the circumstances, Bush has few allies -- and when he looks around at John McCain and Jimmy Carter as his chief defenders, he should wonder how he wound up at such a pass.

Without doubt, this is a complicated issue. In order to win the war on terror, we have to engage moderate Muslims and push the rest of the ummah in their direction. That doesn't just mean politically, but economically as well. DP World has a long reach in Southwest Asia, and the government of the UAE has supported the US when that support cost them among their neighbors. Other bloggers have supported the President's contention that we may be passing up a rare opportunity to demonstrate our willingness to work with Muslim countries, and perhaps even gain some opportunities for better intelligence.

However, the operation of our ports opens a risk that the Bush administration has not adequately shown to have covered. While DP World would not handle port security -- tasks that will still fall to DHS and the Coast Guard -- the management of port operations gives DP World and the UAE government access to a lot of information that could be used by terrorists to attack us. Port managers have to know security protocols, procedures, and personnel, all of which could be used by infiltrators to gain access to sensitive areas or to sneak weapons through what safeguards exist. And while the government of the UAE has been supportive of the US, the feeling isn't unanimous; DP World may have trouble keeping its less-enthusiastic citizens from gaining important posts in their organization.

At any other time, this would not be an insurmountable problem, but the fact is that we are at war with Islamists around the world, and some of them gather in the UAE. Handing operational control over our ports to a state-owned corporation from the same region that generates the terrorists seems like an exceedingly bad idea at this time, and the administration has not done any work until now to make a case for the opposite.

UPDATE: My former partner Dafydd at Big Lizards has a modest proposal ...

UPDATE II: AJ Strata disagrees ...

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» The Sum Of All Fears from All Things Beautiful
Rescind Mr. President. Faith is a misplaced emotion in the long war on terror, and the assurance that U.S. ports will be secure when they are managed by a firm owned by a government in one of the most volatile parts of the world, is worthless. [Read More]

Tracked on February 22, 2006 6:29 AM

» Any Port In A Storm from bRight & Early
The sale of the operation of six American ports to a company from the United Arab Emirates has set off a debate that shows, among other things, that even those who are considered to be on the right don't march in lock step. President Bush made his posi... [Read More]

Tracked on February 22, 2006 12:20 PM