Feb. 22, 2006 -- President Bush did not know that an Arab-owned company was to take over operations at major American seaports until the deal was already completed, the White House admitted today.
"He became aware of it over the last several days," White House spokesman Scott McClellan said.
As Republicans and Democrats teamed up in growing opposition to the deal, the administration also said that it should have briefed Congress sooner.
A growing number of politicians have said they are determined to stop the pending sale of the shipping operations despite Bush's threat to veto congressional action to stop a state-run company in the United Arab Emirates from taking over some U.S. ports.
Last week, Dubai Ports World bought London-based Peninsular and Oriental Steam Navigation Co. When the deal is finalized, Dubai Ports World will take over Peninsular's stake in terminals at six major U.S. ports in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia. The Arab company will control more than 40 million tons of cargo a year.
While the Bush administration says that preventing the deal will send a horrible signal to the United States' allies, Democratic and Republican critics say that the UAE is a country widely known for its ties to terrorism. Two of the Sept. 11, 2001, hijackers were from the UAE. In addition, the FBI has said that money for the strikes was transferred to the hijackers primarily through the country's banking system and that much of the operational planning for the attacks took place inside the UAE.
The Bush administration said that there was little criticism when the English company controlled the ports and that Arab companies should be given the same opportunities.
Criticism From Both Sides of the Aisle
Delaware Sen. Joe Biden, the ranking Democrat on the Senate Foreign Relations Committee, said that the UAE had not yet proven to be a trustworthy ally, and that the Bush administration had not been reliable on port security.
"This is not England," he said. "Nuclear materials have been moved from their ports to Iran and other places -- this is one of three governments that recognizes the Taliban."
Speaker of the House Dennis Hastert, R-Ill., called for an "immediate moratorium" on the deal, and Senate Majority Leader Bill Frist of Tennessee promised legislation "ensuring that the deal is placed on hold."
Elected officials from nearly every state in which a port is based have spoken out about the deal.
"It's just incomprehensible to those of us that are concerned with the safety and security of our communities," said New Jersey Gov. John Corzine.
Biden pointed out that the 9/11 commission had given the administration "failing grades."
"It is one thing to have those failing grades coupled with England that we know is onboard … then to have failing grades with a country that we don't know, in fact, what they're doing," he said. Biden also said the administration had cut funding for port security.
Dan Bartlett, counselor to the president, said the UAE was a partner in the war on terror.
"They're helping us cut off terrorist financing and sharing intelligence. If we're going to win the war on terror, we need more people in the Middle East partnering with us, not isolating themselves from us," Bartlett said. "I think we're sending a dangerous signal to people overseas that America plays favorites."
Biden said that before the UAE becomes a partner in the U.S. ports, it must prove itself.
"This is a show-me game. We want to see what is it in fact the UAE is doing, what safeguards are built in, what kind of vetting process do they have for the workers they'll have there, and what is their record?" he said.
However, the Bush administration said that the company would have nothing to do with security, which would still be handled by the Coast Guard. Most of the ports' employees will continue to be Americans.
Racism Against Arabs?
Some Arab-Americans say that the uproar smacks of racism. Hussein Ibish, an analyst on U.S.-Arab relations, said that ending this deal would tell the Arab world: "We don't trust any of you. We fear all of you and we're suspicious of all of you."
James Zogby, president of the Arab-American Institute, said that the protests against the port deal smacked of election-year politics and jingoism.
"It's an election year and the UAE is an Arab country and it's a lethal brew," he said. "The anti-Arab impetus behind these protests is impossible to ignore."