Bush: I'll veto ports bill

Arab firm's ties alarm Congress on security

By Richard Simon and Peter Wallsten
The Los Angeles Times
Published February 21, 2006, 10:37 PM CST

WASHINGTON -- President Bush vowed Tuesday to veto any legislation that would block the takeover of shipping operations at six large U.S. seaports by a state-owned Arab company, setting up a major confrontation between the White House and its usually steadfast Republican allies in Congress.

Bush's threat came hours after the top Republicans on Capitol Hill—Senate Majority Leader Bill Frist of Tennessee and House Speaker Dennis Hastert of Illinois—joined a chorus of lawmakers in calling for the port deal to be reviewed because of security concerns.

Under the transaction, Dubai Ports World, a business owned by the United Arab Emirates, would operate ports in New York, Newark, N.J., Philadelphia, Baltimore, Miami and New Orleans. A British company had been in charge of the ports, but it recently was purchased by the Arab company.

The Department of Homeland Security gave the new owner permission to run the ports, but political furor over the decision has been growing.

Lawmakers from both parties have expressed security concerns about the deal, with some noting that some of the Sept. 11 hijackers had links to the United Arab Emirates.

The Bush administration views that as an unfair attack on the UAE, which it defends as a strong ally in the war on terrorism. More broadly, criticism of the deal threatens the White House's efforts to build better relations in the Arab world.

Frist said he would pursue legislation, if necessary, to delay the transfer of the ports' management.

Within hours, as Bush was returning from a speech in Colorado, he took the rare step of inviting traveling reporters to the front cabin of Air Force One before issuing his veto threat. He accused critics of attempting to deny a Middle Eastern company the same opportunity as provided to a British firm.

"I'm trying to conduct foreign policy now by saying to people of the world, 'We'll treat you fairly,"' Bush said.

Speaking a short while later upon his return to the White House, Bush sought to underscore that the Coast Guard and the Customs Service—not a foreign company—would be responsible for port security.

"If there was any chance that this transaction would jeopardize the security of the United States, it would not go forward," he said.

The clash could produce the first veto of Bush's administration.

Frist said the deal raises "serious questions regarding the safety and security of our homeland.

Hastert asked the president for a moratorium on the change in ownership until it could be studied further.

"We must not allow the possibility of compromising our national security due to lack of review or oversight by the federal government," Hastert said.

Maryland's Republican governor, Robert Ehrlich, during a tour of Baltimore's port on Tuesday, called the deal an "overly secretive process at the federal level."

The comments Tuesday from his fellow Republicans left Bush little choice but to respond.

The president's decision to hold an impromptu question and answer session aboard Air Force One and then to reiterate his comments upon landing—repeating several times the idea that reversing the deal would send a "terrible" signal to allies—was an unusual departure for a president who likes to appear far above the fray of Capitol Hill politics.

But Bush's assurances did little to quell a bipartisan rebellion on Capitol Hill.

"It should have been painfully obvious that a sale of this type would raise serious concern in Congress and before the American public," Sen. Norm Coleman (R-Minn.) said in a statement.

Frist also complained, "This is not the first time questions have been raised about the executive branch's review process, led by the Committee on Foreign Investment in the United States," a reference to the obscure panel of U.S. officials that rules on whether purchases of American businesses by foreign entities would impair national security.

There was congressional uproar last year over a Chinese oil company's bid to buy Unocal Corp. Lawmakers from both parties said the takeover would compromise national security, and the Chinese oil company, CNOOC Ltd., abandoned the effort.

Also Tuesday, New Jersey's governor, Jon Corzine, said the state will file lawsuits in federal and state courts opposing the agreement.

A senior executive from Dubai Ports World pledged the company would agree to whatever security precautions the U.S. government demanded to salvage the deal. Chief operating officer Edward Bilkey promised Dubai Ports "will fully cooperate in putting into place whatever is necessary to protect the terminals."

A spokesman at the United Arab Emirates Embassy in Washington read a statement from the minister of foreign affairs saying the country has been a U.S. ally in the war on terror.

Bush bristled when asked about the political nature of the dispute. Asked specifically about Frist's comments and those from others in Congress, the president was blunt.

"They ought to listen to what I have to say about this," he said. "They ought to look at the facts, and understand the consequences of what they're going to do. But if they pass a law, I'll deal with it, with a veto."

Los Angeles Times; Times staff writer Joel Havemann and Tribune news services contributed to this report.