Should 'Dubai Ports World' Take Over Our Ports?
Techniguy - 02-20-2006

A matter a growing concern for Americans today is the issue of port security, and primarily, the planned purchase of 6 US ports by Dubai Ports World, a port management company owned by the United Arab Emirates. I keep seeing lawmakers like Hillary Clinton, Chuck Schumer, Lindsey Graham, and others making false arguments and statements on this issue and think some facts are needed here.

Democrats just can't resist throwing out the word "outsourcing" into this debate. "We can't afford to outsource our port security to a foreign country" seems to be the latest talking point. The problem is, this is statement is all nonsense and false. In the first place, we're talking about "port management" here, not "port security". In the second place, management for all US ports is already done by foreign countries, the US does not manage ports anywhere. Don't ask me why, we just never have. It's always been done by foreign companies, maybe because most shipping is owned and done by foreign companies.

The problem we have now has nothing to do with "outsourcing of anything", it's a simple commerce issue. Dubai Ports World wants to purchase ownership rights to 6 US ports currently owned by Peninsular and Oriental Steam Navigation Company of Great Britain. P&O - The Peninsular and Oriental Steam Navigation Company - is one of the world's foremost developers and operators of container ports. They are also the leading ferry operator in the UK and have property interests in the US and Europe. So "outsourcing" is nothing more than an inflammatory term being tossed into the debate for partisan political reasons. You know, we're all supposed to think that "outsourcing" is a product of the Bush Administration and never existed before then, rather than a decades long standing practice of corporate America.

The United Arab Emirates owned company, Dubai Ports World, has been watched closely by the Dept. of Homeland Security and the State Dept. since 9-11-01 and has no security violations or links to terrorism. It has always been in complete compliance with international and US security laws and regulations. UAE is a US ally in spite of the fact that it is located near the center of Islam, and not far from Qatar and Kuwait, also staunch US allies.

In its global operations, Dubai Ports, having signed an agreement with CSX Corporation to acquire its international terminal business and related interests for $1.15 billion, has become world’s sixth largest global port operator. CSX’ international terminal business comprised of 9 terminals with 24 berths across the world having future combined capacity of 14.6 million TEUs [Twenty-Foot Equivalent Units (intermodal shipping container)].

The acquisition provides Dubai Ports an access to new growing markets in Asia and Latin America, which are forecast to offer the highest volume growth in the port industry. The acquisition also provides Dubai Ports important base in the South East and Fare East Asia notably in Hong Kong, China and Korea and further facilitates its global network into Europe, the Americas and Oceania. What we should take from this is that we are talking about a well established international shipping company here, not 'some fly by night' camel jockeys with a boat. Could such a multi-billion dollar company afford to dabble in terrorism at the risk of loosing their business? I think not.

On the other hand, things could change and there is always the possibility that Dubai Ports could become infiltrated by terrorists, working themselves into the right positions to cause harm to the United States. It is not likely that this harm would come in the form of a bomb or other device getting through our ports, we have our own port security to prevent that. The harm could come through management manipulation which could in some way compromise our security measures. Or, it could come as disinformation regarding the security of containers entering our ports. If the US has reason to suspect that there is a breach of security with the ships entering our ports, those ports would be shut down and the ships would not be allowed to enter. This would have a devastating effect on our economy and a disastrous effect on commerce. Our economy is one of the major targets of terrorism.

One complaint being used here is that 95% of shipping containers are not inspected when entering the country. This is not the big security risk that it sounds like. 95% of shipping containers do not need to be inspected because we already know what's in them. That is because they come from overseas companies, or overseas branches of American companies, who have a track record with us and we trust the security measures at their end and the accuracy of their Bills of Laden. For example, we don't need to inspect a shipping container full of televisions from Sony's plant in Japan. We don't need to inspect a shipment of beer from Beck's Brewery in Germany. We don't have to inspect a container of Perrier water from France. And we don't have to inspect a whole lot of containers from Taiwan full of products outsourced for assembly by American companies. These are not high risk containers and don't require extra scrutiny.

All of the containers coming into the country carry Bills of Laden describing the contents and are from companies that we do business with on a regular basis and have established security records. Every container and Bill of Laden is scrutinized before entering the port, but few actually require inspection or scanning. No container enters our country without us knowing what's inside. If there is any reason for doubt, the container is inspected and scanned. This does not mean that the system is 100% foolproof, no system is. But to physically inspect every container entering our ports would cost billions of dollars a year and the time required for the task would bring commerce to a halt. Ships would be stacked up in the oceans like planes waiting to land during the 911 attacks.

Whether our ports are managed by P&O or Dubai Ports World will make little difference to our national security as things are now. It's the future and the unknown that makes us a little squeamish about allowing our ports to be managed by an Arab company with the post 9-11 mentality that we have now and must maintain. In deciding this issue, we also have to consider the consequences of allowing our government to intervene in commerce and free enterprise which is never a good idea. Government regulations on privately owned business are already excessive and hamper the ability of commerce to run their businesses efficiently, and at a profit. You will have to draw your own conclusions on this issue. In my personal opinion, I see no harm coming to America from this transaction, but there is always that slight possibility sometime down the road if radical Islam should spread into major shipping companies.

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