NY Times misrepresented bipartisan objections to Dubai port deal

An article in The New York Times misrepresented the reasons cited by “Democrats and some Republicans” for criticizing the recent agreement to transfer control of terminals at ports in six U.S. cities to Dubai Ports World. In fact, members of Congress from both parties have accused the administration of flouting the law, which requires a 45-day investigation when the acquiring company is owned by a foreign government and the deal could affect national security.

By ignoring a key reason given by “Democrats and some Republicans” who have “disagreed” with Bush domestic security adviser Frances Fragos Townsend's contention that it is “awfully concerning” to treat a Dubai company “different than we would treat the British company” that it recently bought out, a February 27 New York Times article by reporter David E. Sanger, misrepresented bipartisan opposition to the deal, which would allow Dubai Ports World (DPW) to operate port terminals in six major U.S. cities. While Townsend suggested that critics have merely opposed the deal because DPW is a Middle Eastern company, Sanger neglected to mention a different reason that lawmakers of both parties have given for treating DPW differently: They say the law requires it. Critics have noted that, in contrast with previous operating company Peninsular & Oriental Steam Navigation Co. of Britain, which is not owned by the British government, DPW is owned by the government of Dubai in the United Arab Emirates (UAE), a country that The New York Times editorial board itself has said has a “mixed” record on fighting terrorism. So, contrary to Townsend's and Sanger's suggestion, it is not merely DPW's location in the Middle East that “Democrats and some Republicans” have cited to argue that the acquisition warrants greater scrutiny; it is U.S. law, which mandates further investigation of acquisitions involving foreign governments that may affect national security.

In his report, Sanger wrote that lawmakers disagreed with Townsend's belief that "[a]llies in the war on terror all need to be treated equally, no matter where they come from":

Mr. Bush also said he suspected anti-Arab sentiment was the subtext of some of the objections to the Dubai company taking over management of the port terminals from the Peninsular and Oriental Steam Navigation Company, which is British.

His domestic security adviser, Frances Fragos Townsend, returned to that argument on “Fox News Sunday.”

“I think we have to be honest that it's awfully concerning,” Ms. Townsend said, “and to the extent that we're treating one company different than we would treat the British company, I think we have to be very honest and ask ourselves, 'Why is that?' ” She added, “Allies in the war on terror all need to be treated equally, no matter where they come from.”

Democrats and some Republicans have disagreed, saying there was far greater risk that a company like Dubai Ports World could be infiltrated by Al Qaeda or other terrorist groups that could gain access to confidential information about shipments.

But contrary to the administration's suggestion -- and Sanger's report -- lawmakers have based their objections to the deal on U.S. law, which requires an additional 45-day investigation if the acquiring company “is controlled by or acting on behalf of a foreign government” and the acquisition “could result in control of a person engaged in interstate commerce in the U.S. that could affect the national security of the U.S.” Sanger could also have noted that Sens. Hillary Rodham Clinton (D-NY) and Robert Menendez (D-NJ) have proposed legislation to “prohibit companies owned or controlled by foreign governments” -- not Middle Eastern or Arab companies -- from operating U.S. port terminals.

Lawmakers on both sides of the aisle have cited reasons for criticizing the administration's approval of the acquisition of the port terminals by a company owned by a member state of the UAE. The UAE was one of three countries to officially recognize the Taliban prior to the September 11, 2001, attacks, and U.S. investigators have found that more than $120,000 was funneled through UAE bank accounts to the 9-11 hijackers. As The New York Times reported on February 23, the National Commission on Terrorist Attacks Upon the United States (also known as the 9-11 Commission) found that the UAE government “ignored American pressure to clamp down on terror financing until after the attacks.”

It is under these circumstances that both Democrats and Republicans have argued that federal law requires additional review of the deal's national security implications. Indeed, Sanger's own report noted that, in persuading the Bush administration to agree to the extended review, DPW itself recognized that the review is “authorized under U.S. law.”