Ports of Gall

 

Wall street Journal  2/25/06

 

 

 

 

 

 

 

 

I also believe that winning the war on terror not happen by military strength alone. This is fundamentally about America's values and leadership. The idea of winning hearts and minds has been derided by some. But I don't think that we can overlook its singular importance. . ."

                        -Senator Hillary Rodham Clinton, February 25, 2004

 

            In Mrs. Clinton's "hearts and minds" crusade, this will not go down as a good week. A United Arab Emirates government allied with America, that provides a Persian Gulf base for U.S. military operations, and that was the first Middle Eastern country to join the U.S. Con­tainer Security Initiative, has been rewarded with Congressional demagoguery that a company it owns can't be trusted to manage com­mercial operations in U.S. ports. With Mrs. Clinton herself leading the jeers.

            And why? For no other reason than that it would be an Arab-owned company. If it is "foreign" ownership that's alarming, the same politicians would also be denouncing the Chinese, Singaporean and British companies that already manage some U.S. port operations. So the message that. all Arabs need not apply comes through loud and clear.

            By the way, to make this argument does not mean we are accusing critics of racism. We are accusing them of error, not to rule out stupidity. These columns have long supported profiling young Middle Eastern-looking men in airport screening, for example, as a way of reducing the odds of another 9/11. But Mrs.Clinton was absolutely correct to note back in 2004 that to win the war on terror we need Arab and Muslim allies. And trashing friends who are engaging in legitimate commercial transactions is not a good way to keep those allies.

            It is also not a good way to convince the world that we mean what we say about free trade and investment. The port-management business is dominated by non-American companies in part because high labor costs drove U.S. firms out of the business. That's also in part the handiwork of the International Longshoremen's Association, an affiliate of the protectionist AFL-CIO.

            And, 10, the New York Sun reported this week that "nearly.every politician who has been at the forefront of the opposition to the Dubai deal is on the receiving end of some Longshoreman largesse" in the form of campaign contributions. They include New York Representatives Peter King (R),

            Jerry Nadler (D) and Vito Fossella (R) and Senators Clinton, Robert Menendez (D., N.J.), Chuck Schumer (D., N.Y.), Chris Dodd (D., Conn) and Barbara Boxer (D., Calif.).

Another sign of the protectionism at work here is the call to give Congress a larger say in vetting such transactions. But the Committee on Foreign Investment in the U.S. (CFIUS)  the interagency panel that reviewed the DP World contract, is an executive branch function precisely to avoid the parochial concerns that dominate Congress. If Congress ran CFIUS, every Member would have a chance to interfere with every private foreign investment.

            In fact, under the CFIUS statute Congress is barred from being involved in the review process until it is over, and the political meddling we see with respect to the DP World deal is the reason. Such confidentiality is important because companies are often asked to disclose proprietary information to the government. This also explains why the Bush Administration didn't brief Con­gress up and down about the deal in advance.

            To take seriously the political criticisms of the DP World deal, you must also take seriously the notion that President Bush has suddenly gone soft on security. So the same Administration that's criticized for being overly obsessed with terrorism suddenly can't be trusted to vet a routine deal involving terminal management at a handful of U.S. ports. We can understand why some Democrats would want to make this case; the shame is that so many conservatives and Republicans have taken their political bait.

            The good news is that we elect Presidents to represent the national interest on these issues, even if it means taking political heat for doing so. That's what Mr. Bush has been doing this week, and in the process he's caused some of the original yahoos to educate themselves before they demagogue again. We've also learned something about the political character of certain would-be Presidents, such as the junior Senator from New York and Majority Leader Bill Frist, who also joined the early critics. Using "national security" as an excuse for protectionism is not the best way to win anyone's "hearts and minds."