Regardless of the regardless, the deal is dead, looks like, at least as far as DPW getting any of the US ports. Tom Kean, one of the heads of the 9/11 commission, former Rep gov of NJ, came out against it, as did Michael Scheuer, former head of the CIA's bin Laden unit, author of Imperial Hubris. There is simply no way a politician is going to be seen to be in opposition to the head of the 9/11 commission on this. Not going to happen.

Maybe so, Pantom.

However there is a a real blowback to blowing up these kinds of deals.

DPW forced to divest the US port leases for pure politics plays very badly for FDI in the US.

As for Scheuer, he's a paraniod.

The deal will likely go through after its delay. Never bet against Karl Rove, even coming an off year like 2005. And the 9/11 Commission is already knee-high in its own scandals and questionable decisions (Able Danger, the shrill partisanship of its Democrat members), so its political potency has already been dilluted.

Bush and McCain together on this will win Republican support over time. The Dems don't have the votes to stop it.

And nobody in power or in a position of influence gives a damn what Michael Scheuer says. Before liberals, he blames Israel. Before conservatives, he blames liberal PC culture. The man is anthema to people in power with duplicity like this.

I wonder what long-term shifts in policy- if any- there will be in the UAE if things go wrong. They have some awfully large contracts/investments that they could start to shift elsewhere with very little effort. Emirates, for instance, has the largest order book of aircraft in the world, and could buy Airbus far more often in the future.

I'm not surprised by any of those except for O'Reilly. Someone told me Limbaugh came out on Bush's side too. But Reason, the WSJ and Kudlow are all staunch free-marketers first and foremost, so their reactions are to be expected.

Dubaiwalla

Indeed.

In general if this deal goes sour in this manner, it will be taken as a confirmation among the Khalije area (and Islamic generally) business community that the US is becoming and more and more unsafe destination. Which is self-evident in some ways. In general this kind of entirely irrational political blocking adds to the general discomfort.

I am aware of some recent investment vehicles with Arab-US mixtures that have gone south due to Patriot act entanglement and the like. Not in the news of course, but right or wrong it is far easier to do business with Europe and Asia. US growth rate attracts, but the other negatives are there.

Will UAE and others subtly shift away, or will they spend to buy influence? The KSA example of spending to buy influence does not seem to be paying off all that brilliantly, although perhaps arguably they have managed their downside.

Were I placing Arab assets, I would be light on US and longer on emerging Europe and Asia.

I particularly enjoyed, by the way, Kenton's closing, for it is very much spot on:
So, in the end, what we are telling Arab moderates in no uncertain terms is that it doesn't matter what they do; what matters is what they are. After all our posturing about the hypocrisy of Arab and Muslim moderates who haven't stood up to Middle East extremists, it turns out our only reward for the people who do take a stand is a mix of distrust and contempt. The Dubai Ports World controversy is a perfect example of such a reward. And that, in the end, will most likely end up costing us more lives.

I have long found the posturing about "Arab/Muslim moderates" to be fairly empty, an excuse really. The quick and cheap recourse (above all on the Center to Hard Left that supposedly prides itself on being anti-racist) to the worst forms of illogical, irrational and fact free ethnic baiting are at once depressing and confirmatory of the Fuck you Very Much attitude.

Any chance American business interests will begin to reign Congress in?

It seems the application of many of these laws is irrational and ill-utilized, but I'm at a loss for how they can be adequately rolled back or minimized, but I have much more to learn about this matter before I can begin to discuss it in detail as many of you can.

The only thing a failure here would prove is that we think of ports combined with Moslem ownership as a potentially disastrous combination, similar to concerns about Chinese running the Panama Canal, and the administration failed to examine the sensitive issue properly. The more people yell "racist, racist", the more some of us say, "F*** it, if we can't even ask relevant security questions, then we really should be racist." Do you think we'd welcome Russian or Chinese ownership of our ports? So why do we have to prove ourselves to the Middle East on this? And it's funny that the administration so worried about proving us non-racist doesn't mind indefinite detentions at Gitmo, people dying during interrogation and extraordinary rendition to countries that will do our dirty work for us.

Re the above: I understand the blowback, but you're giving Congress way too much credit if you think they do. Scheuer I could see being marginalized, but imagine you as a US politician on the stump, trying to explain exactly why you let the Arabs into the ports even though one of the two co-heads of the 9/11 commission - and the Republican one at that - came out against it.
Two loose ends: I'm glad to see McCain is doing the right thing on this, although it does have to be pointed out that Arizona is landlocked, after all, and Kenton's closing came straight from Dennis the Peasant, the one that eponymous pointed us to.

The only thing a failure here would prove is that we think of ports combined with Moslem ownership as a potentially disastrous combination, similar to concerns about Chinese running the Panama Canal, and the administration failed to examine the sensitive issue properly.

An equally childish concern

The more people yell "racist, racist", the more some of us say, "F*** it, if we can't even ask relevant security questions, then we really should be racist."

If the bloody shoe fits, you can bloody well wear it, whether you like it or not you stupid whinging git.

Asking irrelevant faux security questions is not concern, it is pure ignoramus know nothing xenophobia.

Do you think we'd welcome Russian or Chinese ownership of our ports?

Already have, West Coast.

And once again, it is management of port operations, crane schedules. Not bloody ownership, not that having ownership of the asset makes much bloody difference.

So why do we have to prove ourselves to the Middle East on this? And it's funny that the administration so worried about proving us non-racist doesn't mind indefinite detentions at Gitmo, people dying during interrogation and extraordinary rendition to countries that will do our dirty work for us.

Proving yourselves to the Middle East is hardly the point, it is the global investment community as well as of course walking the walk that the US loves to preach to the rest of the world with respect to openness to foreign investment etc. ad nauseum (correctly).

Queer, only one country in the world is having a conniption over DPW, and it is the US. It might sugggest something to the less dimwitted.

Of course the current American Administration's practices towards actual terror suspects are not relevant to the question of a firm that is internationally respected and not in any way suspected (in non hysteric American quarters) of any connexions whatsoever with "terror."

The blithering on about DPW in the US has been one of the finest pure examples of dimwitted racist xenophobia I have seen in years.

The real problem here is a false dichotomy: no, DPW operating US ports will not reduce their security, yes, Dubai (and even more so Sharjah) is a nirvana for crooks of all kinds.

There is only any point in getting worked up about this if you aim to use it as a bargaining chip to demand - say - the seizure of Viktor Bout's assets in the UAE, or a more rigorous surveillance of the DXB Free Zone companies. That is, something useful.

Personally, I suspect that blocking this transaction would not be effective in this direction. They'd keep the rest of the P&O assets, take a dump, and take their money elsewhere.

Mr. Lounsbury,

Sad that you're unable to have a conversation without calling people names. "you stupid whinging git". Lovely, could you give us a virtual belch now with perhaps some flying food and spittle? No wonder you get your posts deleted from Web sites. In any case, I'll continue to ask questions about security that affects me, thank you.

I already said "I may be racist" in another post, to get that off the table, since "racist" can mean pretty much anything these days, especially to those prone to verbal rampage.

I don't know the specifics of port ownership and what it entails and what risks are involved (yes, I'm an ignoramus in this area), and I was hoping the US government's experts would take their responsibility serious in this area - we pay them countless billions for DHS amongst others - including the mandatory 45-day evaluation that never happened. So maybe we should go back and re-evaluate Russian and Chinese ownership as well. That's not a foredrawn conclusion that they should fail - it's just that in light of 9/11 we were supposed to be re-evaluating our security situation carefully and we obviously haven't been - port ownership probably being a tiny part of the problem of port security itself. But there has been concern about foreign ownership or management of strategic infrastructure before, including a Chinese firm running the Panama Canal. More racism, or a real assessment of China's long-term aspirations and threat?

I would imagine the global investment community is not terribly worried about this one deal, and the global investment community is well aware of political issues that normally exist side-by-side with commercial issues, and is probably cringing more at the inept administration handling of the issue than any "racial" or investment implications. Openness to foreign investment and exceptions for security concerns go well in hand. The WTO agreements fully recognize these concerns, and there are of course worries that things done in the name of security can be really done for economic reasons. But that isn't really an issue here, since the government wanted the deal, and it's public outcry over the lack of scrutiny that's pushing back against the deal.

I'm happy that DPW is reputed to be a fine upstanding company, and like any fine upstanding company, it shouldn't mind going through the same security checkout we're supposed to give to any other company, fine upstanding or not. Now I would doubt UAE ownership of a tennis shoe factory would bring the same kind of uproar, but then there's that shoe-bomber case a few years back...hmmm.....

Regarding "only one country in the world", yes, the US sticks out in the world for a number of reasons - number of nuclear weapons, size of GDP, diversity of population, attraction of irrational hatred (along with the normal well-founded hatred), etc. So, being the lone superpower and all, I think we've accepted that we're sometimes special and have to prepare ourselves in ways others might not. We're racist and xenophobic that way.

Regarding 'a firm that is...not in any way suspected... of any connexions whatsoever with "terror"', DPW is owned by the UAE government which is part of the Islamic world, which right now is in a high dither over the US. Read the papers, I'm sure you'll see it mentioned. Now, security procedures say to evaluate vulnerabilities and risks, not to hand wave them away, and if a real security evaluation says DPW's management of port facilities offers little to no risk, fine. But the Bush administration saying "trust us" is not the same as a real security review. Here are a couple of links to questionable conduct from the UAE - not DPW itself - which might make one question if there's any worry of DPW being a conduit to something bad happening on US soil, including "The independent commission that investigated the 2001 attacks said the U.A.E. government ignored U.S. pressure to crack down on terrorist financing, describing the U.A.E. as a valued counter-terrorism ally, but also a persistent counter-terrorism problem."

http://counterterror.typepad.com/the_counterterrorism_blog/2006/02/steven_emerson_.html
http://counterterror.typepad.com/the_counterterrorism_blog/2006/02/al_qaeda_claime.html
http://www.globalsecurity.org/security/library/news/2006/02/sec-060223-voa03.htm

And I'll repeat the question to which I have no answer - is there in any way the potential that an outcry like that over Danish cartoons could lead to pressure/response in the UAE that would drastically hurt our port operations? The UAE has been restrained to date in its response, but the amount of kowtowing to irrational demands in the name of tolerance, sensitivity and not being racist has left me pretty amazed.

Ooh, quoting steven emerson as a source. Nice.

And, you know, not-at-all-racist-against-arabs.

Did you bother going through the other posts here about this topic?

including the mandatory 45-day evaluation that never happened
There was a mandatory 30-day evaluation. Nobody had any problems. There was an option for a 45-day extension. This was not taken because there was no problem with the takeover. After the deadline passed, the press made an issue of it, which then turned into election-year Congressional interference, in turn making an issue out of a routine business deal. The 45-day review was neither mandatory nor routine, although I believe DPW is now submitting itself to a review anyway. I very seriously doubt that you will find any skeletons in its closet.

So maybe we should go back and re-evaluate Russian and Chinese ownership as well.
The Chinese ports on the west coast have been working fine. There has been no major security scare there. Just what would the point of looking at those deals again be? The only possible reason to do so now would be because people want to give some fig leaf of fairness to the investigation of DPW for its 'crime' of acquiring American assets while being based in an Arab country.

there's that shoe-bomber case a few years back
Remind me again: 1) What nationality did he hold? 2) What on earth is the relevance of that case to a port acquisition?
If a million people a year illegally migrate to the US, do you really think that the best way to smuggle things in would be to pay $6.8 billion to buy ports there? More to the point, why would Dubai's government want to cause trouble with America? It gets along very well with it. One example of this can be seen in its own port- Dubai sees more port calls by American ships than any other city outside the United States.

DPW is owned by the UAE government which is part of the Islamic world, which right now is in a high dither over the US.
It's owned by the Dubai government, not the federal government. And if you were to go by that logic, the US is part of the Western world, which is currently in a high dither over Muslims, and should therefore not be allowed to do business in the Muslim world. Read the papers, I'm sure you'll see it mentioned.

U.A.E. government ignored U.S. pressure to crack down on terrorist financing
Among other things, hawala is now regulated. I suggest you go do some research of your own on the topics of both UAE steps against terrorism and porous borders. More importantly, I would like you to show everyone here how you can possibly prove that DPW control of a US port would jeapordize American security in any way, especially given that the latter would still be handled by US security personnel. Do you mean to suggest that the Dubai or UAE government will put bombs into containers which will go unscreened? Additionally, are you aware that any containers shipped from Dubai to the US are already first cleared by Americans?

the amount of kowtowing to irrational demands in the name of tolerance, sensitivity and not being racist has left me pretty amazed
Actually, the amount of kowtowing to irrational demands in the name of intolerance, insensitivity and being racist has left me pretty amazed.

And if you were to go by that logic, the US is part of the Western world, which is currently in a high dither over Muslims, and should therefore not be allowed to do business in the Muslim world.

I think the potential fallout from this line of thinking is why L is foaming at the mouth.

ADDED - FT today is hilarious (sub only):

The causes of the furore are actually quite simple, and ugly. “Port management” sounds like something important, especially in the post-September 11 world, and many think it cannot be left to “wogs” – a reaction that has been encouraged by shameless politicians quick to recognise a chance for cheap demagoguery.

My dear whinging git, Mashrout:

I frankly am unmoved by your nannyish hand-wringing and imagery over a few strong words to convey your stupidity.

To the point, then:
Mr. Lounsbury,

Sad that you're unable to have a conversation without calling people names. "you stupid whinging git". Lovely, could you give us a virtual belch now with perhaps some flying food and spittle? No wonder you get your posts deleted from Web sites. In any case, I'll continue to ask questions about security that affects me, thank you.

Ask away, hopefully you can aspire to asking questions that make some degree of sense and are not bogglingly stupid.

I already said "I may be racist" in another post, to get that off the table, since "racist" can mean pretty much anything these days, especially to those prone to verbal rampage.

Racist means applying fallacy of composition thinking to entire ethnic groups and being unable to distinguish real risk categories from a generalised fear of the race/ethnic group.

That would be precisely the kind of fear that characterises the xenophobic idiocy responding to DPW "scary Arab company" taking on management of port operations.

I don't know the specifics of port ownership and what it entails and what risks are involved (yes, I'm an ignoramus in this area), and I was hoping the US government's experts would take their responsibility serious in this area - we pay them countless billions for DHS amongst others - including the mandatory 45-day evaluation that never happened.

Well, here is a start:
(i) the 45 day extension is NOT MANDATORY despite the loosey goosey characterisations. I provided a citation to a pre-controversy legal analysis (client summary type analysis) on this very point. The 45 day extension is an option and mandatory if a substantive security threat is found. Merely being foreign-owned in an area like logistics historically (for non-Arabs at least, but also non-Euro) has not triggered the extension. So, there you go, your first sign of racist hysteria and bloviating. (see prior summary post)
(ii) The committee in question conducted its review, your assertion that the job wasn't done right is merely based on (a) your ignorant assert in re the 45 day extension, (b) your pre-made conclusion there must be a threat (oooh, scary Arabs). The actual committee has already noted the firm, DPW, is well known to them and collaborated in security issues already. In short, they already had due diligence on the firm.

Nice that you feel you can, on your impoverished understanding of the US officials work and actual law, smear the bureaucrats as incompetent, given an incompetent understanding of US requirements.

So maybe we should go back and re-evaluate Russian and Chinese ownership as well. That's not a foredrawn conclusion that they should fail - it's just that in light of 9/11 we were supposed to be re-evaluating our security situation carefully and we obviously haven't been - port ownership probably being a tiny part of the problem of port security itself.

Oh, wonderous, open political witch hunts on the underlying capital ownership of operating leases.

To satisfy the know-nothings vague fears of the foreigners. What a brilliant use of limited resources.

Nothing better than letting irrational emotive reaction run policy.

But there has been concern about foreign ownership or management of strategic infrastructure before, including a Chinese firm running the Panama Canal. More racism, or a real assessment of China's long-term aspirations and threat?

More racism and irrational xenophobia on the part of ignorant knee-jerking Americans. The Chinese management of Panama Canal was and is a non-issue.

The issue would be control of the Canal, which managing cranes and ship shedules doesn't do.

Guys with guns, now that does it.

Should discrimination show up in ship scheduling, one can either address it by legal means, or if severe, the Panamanians revoking the contract. If the US is unable to ensure the Panamanians are sufficiently solicitious of American concerns, well then the US diplomatic efforts are simply incompetent.

Chinese "control" comes if Chinese troops are there. Else the nationality of the managers counts for nothing.

I would imagine the global investment community is not terribly worried about this one deal, and the global investment community is well aware of political issues that normally exist side-by-side with commercial issues, and is probably cringing more at the inept administration handling of the issue than any "racial" or investment implications.

Well, your imagination is of little interest.

Of course in any direct investment deal, there are always idiot politicians to be managed. The problem here is the cumulative evidence that US politicians are becoming more and more hysterically xenophobic (or more and more inclinced to tap into the same, granting them the credit of not being drooling morons) and interventionist in ordinary investment deals.

Rather reminiscent of the racist xenophobia that accompanied the great Japanese investement boom of the late 1980s. Pandering.

The US, however, finds itself in a somewhat different position than then, with a serious need to attract large amounts of foreign money to finance its profligacy.

What people in this area see is a rising politicisation of the market for FDI, and a rising risk that non-economic / non-rational political interventions will come into play for those operating or buying US assets.

In the case of DPW, the US assets are incidental and not even core to the deal, P&O's portfolio of Asian and European assets are far more attractive and it is in emerging markets that port management looks to see double digit compound annual growth rates over the next five years. Not old US port assets, which frankly are aged, trapped in archaic practices and unlikely to be able to be really transformed for completely political reasons with the Trade Unions playing the xenophobe card.

So, the issue becomes imposing extra economic cost for lower-end assets for no reason that irrational emotional xenophobic hysteria.

That will continue to add to the pereception of risk re US operating assets (including in this of course are politically motivated lunatic law-suits that one can be subjected to in the United States, based on overseas operations).

For equity investors of the "wrong" ethnic or religious persuasion, the risk premium is significantly higher.

For equity investors of the "right" perceived ethnic or religious persuasion, with US attempts at extraterritoriality, the risk premium rises.

Openness to foreign investment and exceptions for security concerns go well in hand.

Indeed. Security concerns may be rational as in the case of the IT sector, or they may be irrational, as in this case.

The WTO agreements fully recognize these concerns, and there are of course worries that things done in the name of security can be really done for economic reasons.

Or for non-economic reasons, such as hysteria and politics ex-"security".

But that isn't really an issue here, since the government wanted the deal, and it's public outcry over the lack of scrutiny that's pushing back against the deal.

This is possibly one of the stupidest statements you have yet written, itself an achievement in a sense.

Mob rule, public outcry driven by political demagoguery pimping a supposed (a pre-made conclusion) lack of scrutiny, driven soley by the ethnicity of the capital holders, as well as by the generalised protectionist sentiment characterised by the frequent statement "foreigners shouldn't be running our ports."

None of these are points which warm the heart of an WTO analysis.

I'm happy that DPW is reputed to be a fine upstanding company, and like any fine upstanding company, it shouldn't mind going through the same security checkout we're supposed to give to any other company, fine upstanding or not.

It certainly should, insofar as (i) it already has gone through said review [contra your ignorant repeating of spin supra], (ii) is being made to go through the review again for purely xenophobic ethnicity baiting reasons, (iii) spinning the wheels for no good reason wastes money, and I know when I am working on a deal, I am never happy to have lawyers billing more hours to keep some ignorant fools happy.

However, they are playing ball, like good sports.

Now I would doubt UAE ownership of a tennis shoe factory would bring the same kind of uproar, but then there's that shoe-bomber case a few years back...hmmm.....

Well, some issues are far easier to demagogue, aren't they?

Regarding "only one country in the world", yes, the US sticks out in the world for a number of reasons - number of nuclear weapons, size of GDP, diversity of population, attraction of irrational hatred (along with the normal well-founded hatred), etc. So, being the lone superpower and all, I think we've accepted that we're sometimes special and have to prepare ourselves in ways others might not. We're racist and xenophobic that way.

No, the racist xenophobic part comes when the reasonable, established and proper review is demogogued into a hysterical "Oh my god the Arabs are taking over our Ports" bit of nastiness, including utter distortion of the standard processes, mendacious characterisations of the standard review process (with the usual empty and dark hand-waving by journos who cover their own ignorance by calling the committee "secretive" - the adjective would be "obscure" or perhaps "technocratic and boring").

Regarding 'a firm that is...not in any way suspected... of any connexions whatsoever with "terror"', DPW is owned by the UAE government which is part of the Islamic world, which right now is in a high dither over the US.

So, it boils down to ethnicity and religion.

Because some percentage of Muslims are deeply unhappy with the US, that makes DPW "tied to terror."

Of course this is an irrational standard as a UK registered company can just as well be owned by a Muslim, a private citizen, and would be rather more likely to be unfriendly than UAE.

Read the papers, I'm sure you'll see it mentioned. Now, security procedures say to evaluate vulnerabilities and risks, not to hand wave them away, and if a real security evaluation says DPW's management of port facilities offers little to no risk, fine.

The evaluation was already done, but of course the hysterical demogoguery has now twisted this into something else.

But the Bush administration saying "trust us" is not the same as a real security review. Here are a couple of links to questionable conduct from the UAE - not DPW itself - which might make one question if there's any worry of DPW being a conduit to something bad happening on US soil, including "The independent commission that investigated the 2001 attacks said the U.A.E. government ignored U.S. pressure to crack down on terrorist financing, describing the U.A.E. as a valued counter-terrorism ally, but also a persistent counter-terrorism problem."

Well, now you're taking my business.

The UAE financial system is free-wheeling. That ain't news

Like the Swiss, bank secrecy, no questions asked. Lots of money laundering. Not for crimes in UAE, but money flowing in from other jurisdictions.

There is, of course, the other issue of the transitory nature of much of the population. Lots of fairly well-paid people moving in and out or keeping their accounts in Dubai from the rest of the region. People like myself, actually. Or Iranians off-shoring their corporate accounts to shelter from the whackos. As well as Afghan and Central Asian notables with big accounts of funny provenance. But it's not against the law, probably not even US law.

That's well known. It's also not the same thing as a security risk per se on the part of UAE. Certainly scares the virginal, but when it comes right down to it, the really funny money doesn't go into the banking system. Too many traces, with wires and counter confirmations. Cash hawala run in boats and put into real-estate.

An annoyance to US authorities that would like to be omniscient and omnipotent with respect to money flows, but not the same issue as banks actively financing "terror" as such.

As for these
http://counterterror.typepad.com/the_counterterrorism_blog/2006/02/steven_emerson_.html
HAMAS is not regarded in the same light in the region as it is in the US. Insofar as Hamas does not target the US, but Israel, well that's a red-herring. The UAE clearly cooperates on terror groups that target the US - Hamas is an Israeli issue. I'd note the interview is more than slighly vague "UAE royal family " - there is no UAE royal family, there are the Emiral families, in the plural, of each Emirate. The fact that some of the hijackers of 11 Sep passed through Dubai with money is a non-fact. They also passed through Hamburg and London. Says nothing with respect to Dubai and terror. (Indeed to be clear it is Dubai which is the most pro-US Emirate, why the weasel bieng interviewed didn't just say that amuses me, but I note the two Emirates that are not terribly pro US are the two poor-ass backwards ones. Commerce builds relationships).

As for this
http://counterterror.typepad.com/the_counterterrorism_blog/2006/02/al_qaeda_claime.html
Yeah, al Qaeda says lots of things.

Infiltration of UAE governmental agencies might have happened, not bloody likely it was Dubai port agency, and even so, that's another step away from DPW, with its Western managers and sub-Con expat opreational staffing.

Of course, the exact same risk exists in Europe with Euro firms, and in Asia....

Nothing in terms of infiltration is made more serious by DPW owning the management leases for the US ports. The issue of infiltration, indeed, is rather more risky where the Xenophobes and hysterics are not looking. Euro firms, or US firms. American born convert....

The acquisition is a complete red herring in this connexion.

And I'll repeat the question to which I have no answer - is there in any way the potential that an outcry like that over Danish cartoons could lead to pressure/response in the UAE that would drastically hurt our port operations?

How would it?

UAE stops shipping to US? Someone else will pick up the slack.

DPW boycots? Shipments go through other sources.

The question is irrational. Look, if it didn't effect the oil shipments (which it did not) how the bloody fuck do you think it effects containers?

The UAE has been restrained to date in its response, but the amount of kowtowing to irrational demands in the name of tolerance, sensitivity and not being racist has left me pretty amazed.

What leaves me amazed is how stupid you are.

Those claiming 45 days is required do it based on Exon-Florio, in which case the foreign entity would be a government (which Dubai is, sorry I attributed it to UAE-owned instead of Dubai-owned) and that this deal would be a potential security threat. They also claim the Treasury Department has a much laxer definition of security threat, with which they're not happy. So the complainers are stating the 45-day review should have been mandatory if a reasonable standard of security analysis had been applied; the defenders say that the evaluation of a lower security threat was sufficiently rigorous, and that the 45-days was not mandatory as such. The previous British owners were not a government entity, so that's irrelevant to the whole discussion, except for the fairly obvious question, "Why does government ownership make it so much worse than non-government ownership?", but that's asking whether Exon-Florio is needed at all.

The shoe-bomber reference was tongue-in-cheek.

The Russia and China review was mostly tongue-in-cheek. That most of the post-9/11 recommendations for boosting port security have not been implemented was not tongue-in-cheek.

The Bush Administration is much like Lounsbury, with a "fuck you, we know what we're doing, you're so stupid" response to everything. Code Orange for someone banging a hammer on a bridge, national security invoked to put agriculture supports and import tariffs, little done on port security despite it being high on the recommendations, but don't ask questions about a port ownership/management deal or you're racist. No, I don't know who Steven Emerson is, no, I don't think DPW is a "scary Arab company" or that UAE is a "scary Arab country". I do think the Bush administration is a "scary arrogant and incompetent administration", and as such I tend to doubt that it did anything well, and typically the more insistence it puts on how well it did something, the more I doubt it (for example the evaluation of Harriet Miers). I don't have any confidence in the independence of Treasury in doing this review, since many other US departments have gotten steamrolled over the last 5 years to come out with decisions that make the administration happy.

Regarding "mob rule" and such, there's a difference between demanding that the law be followed properly and demanding that "foreigners shouldn't be running our ports" with no real security basis. Presuming it doesn't promote an unreasonable security risk, I don't give a fuck what the foreigners do or own.

"The Bush Administration is much like Lounsbury, with a "fuck you, we know what we're doing, you're so stupid" response to everything."

Actually, Loundsbury is in no way like the Bush Administration (and he has routinely slammed them on multiple occassions).

He may say "fuck you, you're stupid", but he backs it up with facts/figures based on intimate knowledge of the MENA region (as well as specific matters pertaining to the business world - no ivory tower wanker is he).

In other words, he does (and has done) his due diligence. Which is more than can be said for aspects of the Bush administration, to be sure.

I should point out that I am neither especially for or against the DPW deal. What concerned me initially regarding this whole issue is the knee-jerk reaction from both the left and the right that reeked of biogtry and xenophobia. I expected as much from the freepers and wingers on the right. I didn't expect it as much on the left (which I conider myself to be a part of, I guess - I so dislike the left/right dichotomy as my opinions, beliefs, and political persuasion don't fit neatly into it. If pressed, I would say I'm more a left-libertarian with progressive tendencies in certain areas). But I suppose it is not totally surprising given the climate of fear that the administration (and others) have been pimping since 9-11. Sad, really...

What concerns me most (of late) is the stipulations signed off on by both parties (US govt and UAE and/or DPW) with respect to internal docmentation (financial records/accounting/legal doc exemptions that differ for other companies) and agreements made regarding increased US security measures (would like to know what these are other than simple assurances; would like to see some sort of increased US physical presence in re security matters in either port of Dubai or internally within DPW. But that's the security side of me speaking with respect to maritime transportation).

In fact, if I have heard the accounts correctly, there were objections initially raised by DHS and the Coast Guard regarding these security concerns. I am assuming that these initial objections were later dealt with satisfactorially, but there's no way of knowing short of being party to those involved in the process. However, I would agree that the Bush administration doesn't necessaily instill confidence in this regards.

Collounsbury, I'd be interested in your take on three questions.

1. Eponymous's above point about the deal struck about records keeping. Is this a normal agreement? Can you come up with any reason for this seeming exception/exemption?

2. Dan Drezner recently gave three recent examples of fairly powerful states resisting FDI (China, Spain, and France). Is there really a trend here? To what degree do these examples constitute irrational anti-globalization sentiment, and to what degree, now that this sentiment--with an extra dash of racism--has apparently hit legislatures of powerful countries, can it be mitigated?

3. I've heard a couple of Arab businessmen on NPR express their horror at the reaction to the DPW uproar, but it's been hard to get a real idea of how much play this story has been getting in the Middle East. Has it been getting media play? And how?

For every question, a hundred sub-questions. I even carefully edited out non-productive questions. The three points are clear, so imagine your own questions, if mine don't suit.

So many dimwits, so little time.

Those claiming 45 days is required do it based on Exon-Florio, in which case the foreign entity would be a government (which Dubai is, sorry I attributed it to UAE-owned instead of Dubai-owned) and that this deal would be a potential security threat.

I am well aware of the statute you sub-literate drooling git. Go to my post on the deal, there is a fine link on this very issue, as I said, a legal analysis pre-dating this idiocy: the 45 day is not required.

At best, it is an interpretation - the caluse "requires" 45 follow on if there is a finding that there is a security issue. In this case, there was not, so it was optional - this being the prior (even post 11 Sep) interpretation and practice.

Now, in the midst of irrational xenophobic hysteria, suddenly there is a rereading and assertion of another practice as "required."

Post facto.

They also claim the Treasury Department has a much laxer definition of security threat, with which they're not happy.

The committee is staffed as its staffed. Members of everyone relevant. Now the dangling comparative, I don't know laxer than what. Laxer than hysterics at present?

Well, standards should not be set during moments of hysteria.

So the complainers are stating the 45-day review should have been mandatory if a reasonable standard of security analysis had been applied;

In other words, they're boot-strapping their argument.

Thusly, the 45 day review was not mandatory but rather this is nice spin to use because some hysteric xenophobes didn't like the initial, non-panicking, non-hysteric review.

So, under panicked political pressure, we get a new one.

Why, that's great governance that.

Almost as good as when I saw the Lebs bust their contracts cause some peeps didn't poney the right dinero.

As to this "Why does government ownership make it so much worse than non-government ownership?", but that's asking whether Exon-Florio is needed at all.

Actually Exon-Florio strikes me crap law to begin with, but regardless the ownership issue was not in question with respect to the review issue as all along the Governmental angle was in play.

As applied to port operations this remains fundamentally idiotic. As if paying USD 6 billion is a particularly efficient manner of conducting espoinage. Paying off a besotted labourer is far more efficient and likely to succeed.

The Bush Administration is much like Lounsbury, with a "fuck you, we know what we're doing, you're so stupid" response to everything.

The difference is I do know what I am doing and the Bush Administration doesn't. However, the review by professional bureaucrats by standard professinals is another world from say the fucked up idiocy of the CPA-Iraq.

I don't have any confidence in the independence of Treasury in doing this review, since many other US departments have gotten steamrolled over the last 5 years to come out with decisions that make the administration happy.

US Treasury has been largely out of the firing line and has always been a fairly professional organisation in my experience with their overseas staff.

As to the steamrolling in this instance, that's completely nonsensical. The DPW deal was a pure overseas deal with no interest for Bush Administration. There is no issue of steamrolling involved (leaving aside the absurd hand having magical CSX-DPW mystery tour accusations).

Regarding "mob rule" and such, there's a difference between demanding that the law be followed properly and demanding that "foreigners shouldn't be running our ports" with no real security basis. Presuming it doesn't promote an unreasonable security risk, I don't give a fuck what the foreigners do or own.

The law was followed properly and hysteric mob rule is now remaking that.

On these points:
1. Eponymous's above point about the deal struck about records keeping. Is this a normal agreement? Can you come up with any reason for this seeming exception/exemption?

Records keeping, depends on the contracts. DPW is not a public corporation in the US so doesn't have those reporting standards. I presume w/o researching that port firms that actually hold directly the operating leases are probably Deleware corporations and have whatever obligations accrue there (that's not been my affaire in a long time). So, the answer is : depends. I'm not sure what extent of reporting is actually being asked for. Certainly if I were DPW HQ I would not be excited about releasing private corporate data to blabbermouth American officials.

2. Dan Drezner recently gave three recent examples of fairly powerful states resisting FDI (China, Spain, and France). Is there really a trend here? To what degree do these examples constitute irrational anti-globalization sentiment, and to what degree, now that this sentiment--with an extra dash of racism--has apparently hit legislatures of powerful countries, can it be mitigated?

I would have to read the specific examples, but France is well known for its interventionist attitude towards business deals, including killing intra-European deals to build "French" National Champions.

Not with a great deal of brilliance - and of course they have pissed off other EU members and associated countries.

3. I've heard a couple of Arab businessmen on NPR express their horror at the reaction to the DPW uproar, but it's been hard to get a real idea of how much play this story has been getting in the Middle East. Has it been getting media play? And how?
Sadly, I am exile. The whole cancer thing. Certainly the papers have covered it, but I can't speak to the broadcast media.

"1. Eponymous's above point about the deal struck about records keeping. Is this a normal agreement? Can you come up with any reason for this seeming exception/exemption?"

The only one that comes to mind if there was some sort of agreement whereby security measures of some manner (as yet unreported and may be of a confidental and/or secret matter) were agreed to by DPW. Again, I look at this from a DHS/maritime security perspective solely.

While on the surface the agreement regarding record keeping in the US looks somewhat unusual (and I am no lawyer or accountant, so I can't wiegh in one way or another), I could be part of a broader agreement whereby DPW has some direct connection with US security apparatus to ensure security arragements.

I can see, for security purposes (from both US and DPW sides) that this information not be made public. It may draw unwarrented attention to DPW if it were known that the US has a much greater involvement in security oversight in DPW (maybe not so much with direct physical security, but in keeping tabs on such things as routing, cargo manifests, and the like). Particularly with a company of the MENA region that may be drawing heat from some segments of the population (not necessarily UAE population, others in the region). In addition, it might not look good to shareholders/potential investors and the like. I can't say for certain, but I don't think having the US govt hanging around (in whatever capacity) would necessarily inspire confidence with said people.

Likewise, the US govt wouldn't want too much attention drawn to the fact that they have a greater involvement in such matters (for the same reasons above - US govt doesn't want to unduly trouble or burden DPW by making it known to a wider audience that might look unfavorably towards such an arrangement).

That's my take - if I were part of DHS, I'd be particularly hard-nosed about getting security assurances by pushing for greater involvement in some fashion (and I would be pushing for greater security involvement for all maritime transport companies).

Stolen from another comment thread, on the American-politics end of this story:

You know, apart from being a full drum major corps of spin possibilities, this thing is an awfully good bedwetter test.

If you’re honestly worried that the bad brown A-rab company is going to let the Terrists come pouring into Murica, then you’re a goddamned bedwetter.

If you’re wetting the bed on purpose in order to make Bush look bad, I guess that’s something different, but shock theater doesn’t do much for me any more, and frankly, if I saw Frist and Hastert pissing their pants, the last thing I’d want to do is join them.

dear jackmormon,

re: your question:

I've heard a couple of Arab businessmen on NPR express their horror at the reaction to the DPW uproar, but it's been hard to get a real idea of how much play this story has been getting in the Middle East. Has it been getting media play? And how?

i would like to direct you (and anyone else) to abuaardvark's post on the issue:

http://abuaardvark.typepad.com/abuaardvark/2006/02/uae_and_the_por.html

that covers it nicely.

--raf*

Thanks for the replies, everyone.