UAE ports deal and MEFTA

Date: Wednesday, February 22, 2006 2:51 PM

JOB DESTRUCTION NEWSLETTER

February 22, 2006 No. 1424

Controversy is roiling over the outsourcing of the management of some of
our major ports to a company owned by the government of the United Arab
Empirates (UAE). The Mercury News article below alludes to the close ties
the Bush administration has to Dubai. Treasury Secretary John Snow, while
chairman of the CSX rail firm, sold its own international port operations
to DP World for $1.15 billion in 2004, the year after Snow left for
President Bush's cabinet.

There are connections between the Bush administration and Dubai, but I
don't think that is the major reason that Bush threatens to veto any
attempt by Congress to stop this selloff. There is a much larger issue that
Chertoff hinted about on Lou Dobbs:

http://transcripts.cnn.com/TRANSCRIPTS/0602/20/ldt.01.html

MICHAEL CHERTOFF, HOMELAND SECURITY SECRETARY: I'm not
going to go beyond my general description of the process.
And certainly Congress is welcome to look at this and can
get classified briefs. You know, we have to balance the
paramount urgency of security against the fact that we
still want to have a robust global trading system.

When I first heard Chertoff's description of a "robust global trading
system" I assumed that he was just preaching the Bush religion of
laisse-faire free trade, but his statement is much deeper and darker that
it may seem on first impression.

To make things even weirder, Jimmy Carter was interviewed on a Sunday talk
show and said that he sees nothing wrong with the deal! Imagine that, Jimmy
Carter and George Bush agreeing on something! What is going on here?

Bush and the free-trade insurgents who have declared a Jihad against
American citizens probably are worried that if the UAE port deal is stopped
it could impede negotiations on the Middle East Free Trade Initiative
(MEFTA) - a free trade agreement with - you guessed it - the UAE!

Are wondering why Jimmy Carter would be supporting Bush? Perhaps it's
because Carter is a fanatical globalist who has never seen an FTA that he
didn't love. Read the letter from the U.S. Trade Representative thanking
Carter for his support of CAFTA if you need further proof about where
Jimmy's mind is at.

Articles Used for this Newsletter

http://www.mercurynews.com/mld/mercurynews/news/politics/13922695.htm
Dubai company set to run U.S. ports has ties to administration

http://www.ustr.gov/Document_Library/Press_Releases/2004/November/US_Announces_Intent_to_Negotiate_FTAs_with_UAE_Oman.html?ht
The Office of the United States Trade Representative
U.S. Announces Intent to Negotiate FTAs with UAE and Oman

http://www.ustr.gov/Document_Library/Press_Releases/2005/June/Portman_Thanks_Former_President_Jimmy_Carter_For_Supporting_CAFTA-DR.html
Portman Thanks Former President Jimmy Carter For Supporting CAFTA-DR

http://www.ustr.gov/assets/Document_Library/Press_Releases/2005/June/asset_upload_file875_7784.pdf
Jimmy Carter implores Charles Grassley to vote for CAFTA
(image file, must click link to view)

+++++++++++++++++++++++++++++++++++++++++++++++++++

http://www.mercurynews.com/mld/mercurynews/news/politics/13922695.htm

Posted on Tue, Feb. 21, 2006

Dubai company set to run U.S. ports has ties to administration

BY MICHAEL MCAULIFF
New York Daily News

WASHINGTON - The Dubai firm that won Bush administration backing to run six
U.S. ports has at least two ties to the White House.

One is Treasury Secretary John Snow, whose department heads the federal
panel that signed off on the $6.8 billion sale of an English company to
government-owned Dubai Ports World - giving it control of Manhattan's
cruise ship terminal and Newark's container port.

Snow was chairman of the CSX rail firm that sold its own international port
operations to DP World for $1.15 billion in 2004, the year after Snow left
for President Bush's cabinet.

The other connection is David Sanborn, who runs DP World's European and
Latin American operations and who was tapped by Bush last month to head the
U.S. Maritime Administration.

The ties raised more concerns about the decision to give port control to a
company owned by a nation linked to the Sept. 11 hijackers.

"The more you look at this deal, the more the deal is called into
question," said Sen. Charles Schumer, D-N.Y., who said the deal was
rubber-stamped in advance - even before DP World formally agreed to buy
London's P&O port company.

Besides operations in New York and Jersey, Dubai would also run port
facilities in Philadelphia, New Orleans, Baltimore and Miami.

The political fallout over the deal only grows.

"It's particularly troubling that the United States would turn over its
port security not only to a foreign company, but a state-owned one," said
western New York's Rep. Tom Reynolds, chairman of the National Republican
Campaign Committee. Reynolds is responsible for helping Republicans keep
their majority in the House.

Snow's Treasury Department runs the Committee on Foreign Investment in the
U.S., which includes 11 other agencies.

"It always raises flags" when administration officials have ties to a firm,
Rep. Vito Fossella, R-N.Y., said, but insisted that stopping the deal was
more important.

The New York Daily News has learned that lawmakers also want to know if a
detailed 45-day investigation should have been conducted instead of one
that lasted no more than 25 days.

According to a 1993 congressional measure, the longer review is mandated
when the company is owned by a foreign government and the purchase "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."

Congressional sources said the president has until March 2 to trigger that
closer look.

"The most important thing is for someone to explain how this is consistent
with our national security," Fossella said.

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http://www.ustr.gov/Document_Library/Press_Releases/2004/November/US_Announces_Intent_to_Negotiate_FTAs_with_UAE_Oman.html?ht

The Office of the United States Trade Representative

Home / Document Library / Press Releases / 2004 / November / 11/15/2004

| U.S. to Negotiate FTAs with UAE & Oman

U.S. Announces Intent to Negotiate FTAs with UAE and Oman
Contact: Richard Mills / Neena Moorjani (202) 395-3230 11/15/2004

WASHINGTON, DC - U.S. Trade Representative Robert B. Zoellick today
announced the Administrations intent to negotiate Free Trade Agreements
with the United Arab Emirates (UAE) and Oman, important steps on the path
to fulfilling the Presidents vision of developing economic growth and
democracy in the Middle East.

Zoellick sent a letter today to Congressional leaders to notify of this
intent to negotiate, in accordance with the procedures Congress established
under the bipartisan Trade Act of 2002.

Transmittal of the letter to the Hill followed shortly after Ambassador
Zoellicks visit to the UAE and Oman and after House Ways and Means
Committee Chairman Bill Thomas led a Congressional delegation to Oman and
other countries in the Middle East.

"A free trade agreement with the UAE and Oman will promote the
Presidents initiative to advance economic reforms and openness in the
Middle East and the Persian Gulf, moving us closer to the creation of a
Middle East Free Trade Area," wrote Zoellick. "An FTA with the UAE and Oman
will build on the FTAs that we already have with Israel, Jordan, and
Morocco, as well as the FTA that we recently have signed with Bahrain. It
will also encourage the six members of the Gulf Cooperation Council to
adopt standards that promote trade and investment. Furthermore, our free
trade agreements in the Middle East complement The 9/11 Commission Report
recommendation urging the United States to expand trade with the Middle
East as a way to encourage development, more open societies and
opportunities for people to improve the lives of their families."

"These FTAs will directly benefit the United States," continued Zoellick.
"By reducing and eliminating barriers to trade, a comprehensive FTA with
the UAE and Oman will generate export opportunities for U.S. companies,
farmers, and ranchers, help create jobs in the United States, and help
American consumers save money while offering them more choices."

The United States trade relationship with the UAE is the third largest in
the Middle East, behind only Israel and Saudi Arabia. The U.S. has a
combined trading relationship of $5.6 billion and a trade surplus of over
$2 billion with these two countries. Major exports to these two countries
include machinery, aircraft, vehicles and electrical machinery. Major
imports include mineral fuel and woven apparel.

In initial consultations with the Congress, including a meeting with the
Congressional Oversight Group on September 8, 2004, broad bipartisan
interest was expressed for an FTA with the UAE and Oman. Following these
consultations, Zoellick visited the UAE and Oman in October to discuss with
top officials the topics covered in the United States comprehensive
FTAs, to identify particular areas for work, and to assess the UAEs and
Omans commitment to moving forward with an FTA.

The Office of the U.S. Trade Representative will work closely with the
Congress over the next 90 days, as required by the Trade Act, and expects
negotiations to commence in the beginning of 2005.

Middle East Free Trade Initiative (MEFTA)

In May 2003, the President proposed a plan of graduated steps for Middle
Eastern nations to increase trade and investment with the United States and
others in the world economy. The first step is to work closely with
peaceful nations that want to become members of the World Trade
Organization (WTO) in order to expedite their accession. As these countries
implement domestic reform agendas, institute the rule of law, protect
property rights (including intellectual property), and create a foundation
for openness and economic growth, the United States will take a series of
graduated steps with countries in the region tailored to their level of
development.

The U.S. will expand and deepen economic ties through comprehensive FTAs,
Trade and Investment Framework Agreements (TIFAs), and Bilateral Investment
Treaties (BITs), and will also enhance the Generalized System of
Preferences (GSP) program for eligible countries. This Administration has
concluded two FTAs, Morocco and Bahrain; ratified a third, with Jordan; and
signed eight TIFAs with Middle East nations.

United States Trade Agreements

U.S. FTAs: These are reciprocal and ambitious agreements that open markets
and strip away barriers across a broad array of goods, services, and
agricultural products.

TIFAs: The United States has TIFAs with a number of countries to enhance
bilateral trade and coordinate regionally and multilaterally through
regular senior-level discussions on trade and economic issues. The TIFAs
create Joint Councils that consider a wide range of commercial issues and
sets out basic principles underlying the nations' trade and investment
relationship.

BITs: These agreements level the playing field and ensure that U.S.
investors are protected when they establish businesses in other countries.
By safeguarding foreign subsidiaries of U.S. firms, BITs help promote new
U.S. exports to the markets of BIT partners. BITs also protect the
interests of average American investors, whose stock and bond portfolios
often include stakes in foreign-invested firms.

U.S. Trade Agenda

The United States is working to open markets globally in the Doha WTO
negotiations; regionally through the Asia Pacific Economic Cooperation
(APEC) and the Free Trade Area (FTAA) of the Americas negotiations; and
bilaterally, with FTAs. The Bush Administration has completed FTAs with 12
countries -- Jordan, Chile, Singapore, Costa Rica, the Dominican Republic,
El Salvador, Guatemala, Honduras, Nicaragua, Australia, Morocco, and
Bahrain. With this announcement, negotiations are under way or about to
begin with 12 more countries: Panama, Colombia, Peru, Ecuador, Thailand,
the five nations of the Southern African Customs Union (SACU), and now the
UAE and Oman. New and pending FTA partners, taken together, would
constitute Americas third largest export market and the sixth largest
economy in the world.

U.S. - Middle East Free Trade Efforts (see chart)
http://www.ustr.gov/assets/Trade_Agreements/Regional/MEFTA/asset_upload_file38_6745.pdf

The 9/11 Commission Report

The U.S. government has announced the goal of working toward a Middle East
Free Trade Area, or MEFTA, by 2013. The United States has been seeking
comprehensive free trade agreements (FTAs) with the Middle Eastern nations
most firmly on the path to reform. The U.S.-Israeli FTA was enacted in
1985, and Congress implemented an FTA with Jordan in 2001. Both agreements
have expanded trade and investment, thereby supporting domestic economic
reform. In 2004, new FTAs were signed with Morocco and Bahrain, and are
awaiting congressional approval. These models are drawing the interest of
their neighbors. Muslim countries can become full participants in the
rules-based global trading system, as the United States considers lowering
the trade barriers with the poorest Arab nations.

Recommendation: A comprehensive U.S. strategy to counter terrorism should
include economic policies that encourage development, more open societies,
and opportunities for people to improve the lives of their families and to
enhance prospects for their childrens future.

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http://www.ustr.gov/Document_Library/Press_Releases/2005/June/Portman_Thanks_Former_President_Jimmy_Carter_For_Supporting_CAFTA-DR.html

Portman Thanks Former President Jimmy Carter For Supporting CAFTA-DR

06/09/2005

WASHINGTON U.S. Trade Representative Rob Portman thanked former U.S.
President Jimmy Carter for his strong letter of support today for the
U.S.-Central American-Dominican Republic Free Trade Agreement (CAFTA-DR)
sent to the Chairmen and Ranking Members on the key Senate and House trade
committees.

"President Jimmy Carter knows Central America well. He understands that
CAFTA-DR is not only a great agreement for Americans, its a great
agreement for our friends and neighbors because it will promote economic
growth, development and support democracy," said Portman. "President
Carters voice of support is an important contribution to the debate in
Congress, and his letter will inform Members as they consider CAFTA-DR in
the coming weeks. As President Carter stated: If the U.S. Congress were
to turn its back on CAFTA, it would undercut these fragile democracies,
compel them to retreat to protectionism, and make it harder for them to
cooperate with the U.S."

"I want to thank President Carter for taking a strong public stand in
support of CAFTA-DR, and I look forward to working with him as the
agreement moves through Congress," added Portman.

President Carters letter was addressed to Senate Finance Committee
Chairman Chuck Grassley, House Ways and Means Chairman Bill Thomas, Senate
Finance Committee Ranking Member Max Baucus and House Ways and Means
Ranking Member Charlie Rangel.

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