Bush unaware of controversial ports deal until it was done, aide says

WASHINGTON – President Bush was unaware of the pending sale of shipping operations at six major U.S. seaports to a state-owned business in the United Arab Emirates until the deal already had been approved by his administration, the White House said today.

Defending the deal anew, the administration also said that it should have briefed Congress sooner about the transaction, which has triggered a major political backlash among both Republicans and Democrats.

Bush on Tuesday brushed aside objections by leaders in the Senate and House that the $6.8 billion sale could raise risks of terrorism at American ports. In a forceful defense of his administration's earlier approval of the deal, he pledged to veto any bill Congress might approve to block the agreement.

Bush faces a rebellion from leaders of his own party, as well as from Democrats, about the deal that would put Dubai Ports in charge of major shipping operations in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.

While Bush has adamantly defended the deal, the White House acknowledged that he did not know about it until recently.

"He became aware of it over the last several days," McClellan said. Asked if Bush did not know about it until it was a done deal, McClellan said, "That's correct."

"The president made sure to check with all the Cabinet secretaries that are part of this process, or whose agencies or departments are part of this process," the spokesman said. "He made sure to check with them — even after this got more attention in the press, to make sure that they were comfortable with the decision that was made."

"And every one of the Cabinet secretaries expressed that they were comfortable with this transaction being approved," he said.

The U.S. government, including officials from the Department of Homeland Security, reviewed the deal to evaluate its national-security implications, and approved it. In this case, Dubai Ports World would oversee shipping arrivals, departures and unloading at the docks, but the federal government would continue to handle port security.

But the political furor over that decision has been growing in the past few days.

Responding to the bipartisan calls that the deal be revisited — and perhaps disapproved — Bush was blunt.

"I want those who are questioning it to step up and explain why all of a sudden a Middle Eastern company is held to a different standard than a [British] company," Bush told reporters.

Who runs Seattle port?

Seattle has four main cargo terminals. The land and much of the equipment is owned by the Port of Seattle and leased to companies that operate the cargo terminals. The terminals and operators in Seattle:

Terminals 18 and 25: SSA, formerly known as Stevedoring Services of America, is a Seattle company that runs ports around the world. It is privately held, so financial details aren't known. Its revenue has been estimated at $1 billion a year.

Terminal 5: APL, or American President Lines, is part of the NOL Group, formerly known as Neptune Orient Lines, based in Singapore. It is publicly traded on the Singapore Stock Exchange, with U.S. headquarters in Oakland, Calif. Revenue totaled $942 million in 2004.

Terminal 46: Total Terminals International, a joint venture between Hanjin Shipping of South Korea and Marine Terminals of Oakland, Calif. Hanjin is traded on the Korea Stock Exchange and had revenue of $5.8 billion in 2005. Marine Terminals is private and revenue isn't released. Total Terminals also has operations in Long Beach and Oakland.

Seattle Times staff

He said the transaction was thoroughly scrutinized by administration officials, who concluded that it poses no threat to national security. He praised the United Arab Emirates as a close ally against terrorism and warned of sending the wrong message to the world by condemning a business just because it is Arab-owned.

Legislators on both sides of the political aisle have questioned whether the deal would compromise security at the ports, with some noting links that the Sept. 11 terrorists had to the United Arab Emirates. They noted that some of the hijackers involved in the Sept. 11, 2001, attacks used the UAE as an operational and financial hub.

The Bush administration views that as an unfair attack on the country. More broadly, criticism of the deal threatens the White House's efforts to build better relations in the Arab world.

Lawmakers "ought to listen to what I have to say about this," Bush 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."

He was noncommittal when asked if he would agree to let administration officials brief Congress on the agreement. He said the Arab company's record was "clear for everybody to see."

Rep. Mark Foley, R-Fla., called Bush politically tone deaf. "Of all the bills to veto, if he lays down this gauntlet, he'll probably have 350 members of the House ready to accept that challenge," Foley said.

Frist, visiting the Port of Long Beach, Calif., on Tuesday, set the stage for Bush's sharp remarks when he urged that the port deal be put on hold until the administration conducts a "more extensive review" of it.

If the administration refused, he said, he would introduce legislation to delay the transaction.

Hastert, in a letter to Bush, said he was "very concerned about the national-security implications" of the deal and asked for "an immediate moratorium" on it.

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

These and other comments from Republicans left Bush little choice but to respond. He took the rare step of inviting traveling reporters to the front cabin of Air Force One as he returned from a speech in Colorado to issue his veto threat.

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.

Bush'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 his position 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.

The clash could produce the first veto of Bush's administration. It also comes against a backdrop of recent tensions between Bush and Congress over the administration's conduct of the war on terrorism and the operations of the Homeland Security Department.

Sen. John McCain, R-Ariz., urged his colleagues to "take a moment and not rush to judgment."

"The president's leadership has earned our trust in the war on terror, and surely his administration deserves the presumption that they would not sell our security short," McCain said in a statement.