The Port Security Controversy

February 27,  2006    

Many Americans are upset by the thought of a Dubai-based corporation running port operations in several major American cities.  The company involved now has agreed to delay taking over those operations while the Bush administration and Congress settle their differences and address the ire of the American people.

There’s nothing necessarily wrong with a company from the United Arab Emirates being involved in U.S. port operations.  After all, Islamic terrorists have lived in many European countries, and nobody suggests that E.U. corporations should be similarly disqualified.

But this is not a matter of one foreign company buying another and taking over existing operations in the United States.  The Dubai company, DP World, is owned by the government of the United Arab Emirates.  It is in essence an agent of a foreign government, which raises questions:  Does DP World truly operate like any corporation, answering to a board of directors, serving shareholders, and working to boost profitability?  Or does it serve the foreign policy and economic goals of the United Arab Emirates? 

This is not a true free market transaction, but rather a marriage of multinational corporate and state interests.  And surely the American people should have a say over foreign governments doing business here, especially when that business affects port security.

It's important to note the administration did not bother to consult with Congress or the state governors involved.  The Treasury department approved the purchase with no congressional oversight whatsoever.  While many applaud unchecked presidential authority when it comes to war in Iraq, wiretapping, and other national security matters, they now demand that Congress overturn a unilateral administration decision.  The lesson learned is that everybody likes presidential power when they agree with how it’s used.  When they don’t, they rediscover that the Constitution authorizes Congress to make policy after all.

There also is an important states’ rights issue involved in this controversy.  Why are Treasury department bureaucrats in Washington making decisions about port security?  Most American ports are owned by U.S. states, cities, or local port authorities, not the federal government.  Do Treasury department personnel 1500 miles away really know what’s best for the ports of Galveston or Freeport?

I strongly support those governors who have indicated they do not intend to allow the federal government to dictate who will run their ports. I hope Texas state officials display the same determination and resist a potentially dangerous federal dictate regarding the operation of our ports.