Tuesday, February 21, 2006

Hold your horses

I am very happy with President Bush's reaction to the current uproar over the DP World acquisition of P&O:
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.
"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.
I particularly admire him since it seems to be quite an unpopular stance. Clearly if there was reason to believe that security would be compromised by the deal, this should be investigated, but the arguments I have seen until now sound most unconvincing: UAE citizens were part of 9/11? So what? If you give me proof that UAE were implicated in terrorism etc. I would be more willing to listen (though port security is still not run by the port owner). Additionally, since the acquisition was announced in October 2005, I find it a bit rich that people should wake up now. Today's Financial Times has a very critical editorial on the furore, and though I consider myself a hawk on these issues, I cannot but help agreeing with some of it (excepting the "racist" jibe):
The current furore in Washington about the takeover of P&O, the UK-based ports operator, by Dubai Ports World says more about the United States Congress than the United Arab Emirates. The bluster about national security conceals one of the uglier faces of US protectionism - the one with the slightly racist tinge.
This is a more strident response than last year's rebuff of CNOOC, the Chinese state-owned oil company, and its $18bn bid for Unocal. The UAE is a strategic US ally in the Middle East. The Bush administration is right to defend the deal and the alliance.
First, the deal has been vetted by an inter-agency committee. And ports, in any case, are in one of the most highly regulated sectors in the US. What matters is how they are managed, not who owns them.
Second, leading Dubai companies such as DP World bring with them certain advantages. They habitually: spend money to make money; headhunt the best professionals (in DP World that includes top Americans); and produce high rates of growth. The ambitious new $15bn aerospace enterprise Dubai announced this week will be built around that formula.
Third, the honourable senators might get this purchase in perspective by pondering the extent to which the Gulf allies they so distrust already own vast quantities of US assets, as well as dollar assets held offshore. For Abu Dhabi alone, a 1 percentage point move in US interest rates now means more than a $10 per barrel swing in the price of oil. Do the math.
So, though I wish Bush would veto more legislation (spending bills in particular) and I generally agree with the criticisms levelled at him by Instapundit, I strenuously object to Glenn's insulting dismissal of Bush's decision to threaten to veto Congressional blocks to the deal:
SO NOW BUSH IS THREATENING TO VETO any legislation that would block the Dubai ports deal? Either this deal is somehow a lot more important than it seems (a quid pro quo for, well, something . . . ) or Bush is an idiot. Your call.
He might disagree with the President's arguments, but it belies a narrowness of thought to say that he is either hiding something or an idiot, reminscent of looney Democrats (also read the updates, which qualify the statement and mention supporters of the President's decision). Is it that difficult to see how blocking this deal on such flimsy pretexts will look to the rest of the world?

1 comment:

copy editor said...

Yes, this does have hysteria written all over it. And, it does have bad politics written in bold lettering as well. This administration is running out of steam at a very bad time in the election cycle and the war on Iraq.

Very fine post though.