Friday, February 24, 2006

The Dubai Deal

By Joy
(cross posted on Daily Kos)

The Dubai Ports deal we've heard so much about in the past week is a spectacular and sordid tale of robber barons, fancy business maneuvering over decades of time, of power-building and power-breaking. It's about long-term manipulations affecting nations politically all over the globe and aiming toward a single overarching goal - a 'New World Order' where a small group of people rules the world with an iron fist in a corporate-controlled (and corporation-controlling) oligarchy.

Whether the deal does in fact represent a significant threat of further terrorist attacks in the US - thus is a national security concern on the level of 9-11 - is debatable. To measure such threat it would be necessary to first answer questions still unanswered about the 9-11 attack, which the administration on whose watch it was allowed to occur has no intention of answering. Ever. And, ultimately, we'd have to get an answer to the question of whether there is any such thing as national security in the corporately globalized world our leaders have volunteered us to serve.

I have spent this most interesting week doing some net-surfing (I'm sure the NSA watchers are spinning their heads around) to see what there is to see out there. Bush's Tuesday reaction - to pitch a toddler-sized hissy fit and threaten to veto anything launched to stop this deal (that Scotty said on Wednesday the President didn't know about anyway, and the Sec. Treas. chair of CFIUS said Thursday he didn't know about either, wasn't really secret. That's just the spin to account for why this dirty deal got all the way to approval before anybody found out about it. There's months and years' worth of public information out there about both this deal and the deals that led up to it, released by the corporations themselves, by news media, and by government announcements.

I have put together a timeline and highlighted pertinent cross-connections with very brief references. Included are links to the material still available on the internet, so anyone interested can go to those sources and confirm information or gather further informational links. It's gotten unwieldy fast, so now (Friday) it's going to be pretty bare-bones to anyone who hasn't been following developments or wondering about certain connections. I am not a lawyer, not a congresscritter, and not a stockholder with a financial interest in any of this.

I'm just an American, and I think this travesty represents a unique opportunity to honestly examine our true current position and circumstance in the world. Only by putting it together in our minds can we rationally decide if it's a 'good' thing or a 'bad' thing and act accordingly.

Dubai's monarchy - an "Emirate" of Sheiks - is 200 years old, and the royal family controls or holds controlling interest in almost all significant economic activities in the kingdom, and holds important positions in the collective UAE's governance and military organizations. Before the discovery and exploitation of oil and gas in the Gulf region, the Port of Dubai enjoyed a storied past as a pirate port and smuggling center. Smuggling of opium/heroin, "re-export" of arms, gold to India (where trade in gold is illegal) are all still accomplished through Dubai. But now it's a financial and tourist center too, and UAE's wealth (actually the wealth of the royal families) is being invested in globalized industries as well.

1978 - 22-year old Jones Act container shipping company Sea-Land, a division of RJ Reynolds Industries, establishes a private, limited corporation responsible to the Ruler of Dubai for the design, operation and maintenance of a state-of-the-art, 66-berth, deep-water port and trucking operations center at Mina Jebel Alik, UAE. This is the largest port complex in the Middle East.

This spinoff company allows Sea-Land to maintain a non-Jones Act-regulated port facility in a strategic trading region, where shipping containers can be transferred around the globe on foreign-flag ships. The immensely lucrative business of "re-export" is established, answerable to (owned and controlled by) the Dubai royal house directly, a means of circumventing protectionist laws (like Jones Act), political embargoes, and trade restrictions. Container service expands to India in 1979 with bi-weekly service, and between the US and Shanghai in 1980.

Jones Act (Merchant Marine Act)
Horizon History

1984 - Sea-Land separates from RJ Reynolds to become an independent, publicly-traded company, and achieves its highest revenues and earnings in its history.

1986 - Richmond-based CSX Corporation buys Sea-Land, allowing CSX to combine rail, sea and overland cargo movement. The company retains its name, Sea-Land.

1990 - Sea-Land announces an agreement to pioneer containerization in the former Soviet Union, including development of the Trans-Siberian Land Bridge.

1991 - Sea-Land and Maersk [Rotterdam] announce a vessel-sharing agreement in trade between North America and Asia, John Snow becomes Chairman and CEO of CSX, a position he holds until being confirmed as Treasury Secretary by G.W. Bush in 2003.

Source Watch: John Snow

1994 - Sea-Land and Maersk announce a consolidation of their management alliance, with centers in Rotterdam and Charlotte. Sea-Land moves to occupy the Charlotte Tactical Planning Center in 1995.

1999 - CSX divides Sea-Land into 3 different companies: a Global liner division, a Domestic division, and a Terminals division in March. In July Maersk announces an acquisition bid for the Global liner division of $800 million US. The acquisition is completed in December of 1999. CSX maintained control of the Domestic and Terminals divisions.

Meanwhile, back in the UAE

2001 - CSX Lines [Domestic] announces the creation of Horizon Services Group [HSG] in a restructuring of the existing organization of CSX Lines. HSG operates separately from other existing CSX Lines operations.

2003 - In January, CSX Lines receives C-TPAT certification [Customs-Trade Partnership Against Terrorism]. Sale of the CSX Lines to the Carlyle Group for $300 million US is completed two months later. Re-named Horizon Lines, the headquarters remained in Charlotte.

2004 - Horizon Lines sold by the Carlyle Group in July to Castle Harlan of New York for $650 million US. Horizon Lines is the largest domestic [Jones Act-regulated] ocean carrier in the United States.

CSX launches CSX World Terminals and announces plans to further develop operations in Hong Kong, Mainland China and the Asian Pacific under this name, then promptly sells CSX WT to Dubai Ports International, Terminals division [DPI Terminals]

Lots of CSX TW dealings

2005 - The Dubai royal family's spinoff (and control) portion of the Sea-Land/CSX empire, meanwhile, has been kept pretty quiet. Dubai Ports (apparently a separate royal-owned enterprise) had confined itself primarily to operations in the Persian/Oman Gulfs and Arabian Sea, servicing the ME region as it had traditionally done. In March of 2005 DPI "stunned" the shipping industry by announcing its acquisition of CSX TW "just days" after its late entry into the bidding (dominated by Singapore's Temasek PSR group), for $1.142 billion dollars US. Which, btw, is $8 million less than its original offer of $1.15b.

World Cargo News: Stop the Press
Business Journal
DPW].

In September of 2005, DPI reorganized into a single global business as Dubai Ports World [DPW]. The next month (November) the DPW board approved cash outlay for acquisition of British ports giant Peninsular and Oriental Steam Navigation [P&O]. DPW announced the acquisition in industry press on February 11, 2006, and the rest is history in the making. This is the deal for control of 6 (or maybe 21) US ports before us today, and the price now stands at $6.8 billion US.

DPI reorganization
DPW approves cash for P&O
P&O Bidding War
Gulf News

Wiki: Anti-Trust

...oh, yeah. Mersk bought P&O's shipping division (containers and ships) just this past Christmas - December 2005. So this is just about who controls the ports, not who sails into or out of them.

That's the timeline and connections I've traced thus far. There is much political hay being made, and dozens of further links following the public revelations this week, but there's not room for them here. I just wanted to give an overview. The fact that Sandborn went straight from DPW to a position to waive this deal through a process that other of the by-law principals (like Snow and Rummy) claim they knew nothing about is a more specific factor in the determination of whether or not this deal is strictly legal (or if legal corners were 'cut'). The strategic position of UAE in our current foreign adventures is also a factor no doubt considered, along with UAE (Dubai in particular, Kuwait as always) allowance for basing of US troops and military assets.

And the involvement of UAE in issues of national security to the US (both for us and against us) seems here to be overcome by simple cash investment and controlling ownership in the Sea-Land Global division from its very beginning.

It's all very twisted and complex, but what matters to Mom and Pop America is what hits them in the gut. Nothing about the shady and not-so shady business dealings of shifting monopolies (somewhat fluid, but always kept 'in-family') in the world's shipping industries justifies allowing compromise of vital US national security information - or even the "appearance of" possible question to be raised.

I'll wrap this up with a short statement. If we are indeed at war with Islamic extremists, and any countries that provide sanctuary or support to Islamic extremists, Dubai's well-documented connections to 9-11 disqualify it from even thinking about taking over operations of any port in this country. So long as Americans are fighting and dying in Iraq for what we were told were (even more tenuous) connections to 9-11, we won't turn over a single dock or pier. We must stand with the Stevedores and Longshoremen who have filed suit to block this deal. And our leadership in Congress must spotlight the shady dealings that led us here.

Making secret 'treaties' (agreements of national interest) with foreign nations/nationals which serves or could serve to transfer any strategic or national security defense information to the 'enemy', is the definition of treason.

8 Comments:

Anonymous rhg said...

Dubai and terrorism [cross-posted from Daily Kos]

You write:
Dubai's well-documented connections to 9-11 disqualify it from even thinking about taking over operations of any port in this country.

Let's take a closer look at Dubai and terrorism:

1) The "connections to terrorism" include two key items:
a) a recognition of the Taliban pre-9/11
b) money laundering through UAE banks
c) three of the 9/11 terrorists came from the UAE

Let's look at these more closely:
a) is not particularly excusable, true. However, once it became clear that the Taliban were connected to the attacks on New York the government dropped its connections to the Taliban. And what of the other governments that recognized the Taliban? We're close allies to the key supporter, Pakistan. Does this permanently disqualify the UAE to ever be a U.S. ally?

b) The UAE's banking system was built in a hurry without serious oversight. EVERYONE was money laundering through the UAE, including Russian mafia, Saudi princes, Lebanese arms dealers. That has changed (well, to some extent). The key point here, though, is the assumption that the government of the UAE had foreknowledge or consented to the laundering; there is no evidence of that.

c) Like a lot of places in the late 1990s, young people looked to the Taliban and al-Quaeda as an exciting and sexy new thing. Quite a few young Arabs - and an interesting number of non-Arabs - flocked to Afghanistan to fight what they saw as the secular West and to create a new world. In a lot of ways, these folks were the Arab world's version of the Weather Underground or the other radical terrorist groups of the 1960s and 1970s, lured by an exciting and schematic "solution" to all the problems of the world. Does this mean that the government of the UAE was involved in their recruitment, or consented in their actions? Did the government of the U.S. consent in the actions of Timothy McVeigh?

The current government of Dubai has done quite a bit to moderate and suppress extremist Islamists in the UAE. Dubai is not a terrorist country! It wants, above all else, profits and money. If you were to read about the history of the UAE, you'd see that it comes from a different tradition than the rest of the Arabian peninsula, a tradition that has allied itself with the west for nearly two centuries. While it is not democratic - far from it - it does value trade, free relationships with the West, stability, and fears and despises radical Islam.

Please learn some facts before slinging these ill-informed innuendos. Neither Dubai nor the UAE is "The Enemy" you accuse it of being.

1:40 AM, February 25, 2006  
Blogger joejoejoe said...

Nice work Joy! I wanted to a few background details on the UAE for use in future posts.

1) STATEMENT by THOMAS A. SCHWEICH
Chief of Staff, US Mission to the UN, US State Department, Before the Senate Homeland Security and Governmental Affairs Committee, 5/17/05:

"A second example to which I would draw your attention involved the use of ferries traveling from the United Arab Emirates to and from Iraq, ostensibly authorized only to transport passengers and their immediate possessions, not commercial goods. In a series of 661 Committee meetings, we and the British repeatedly objected to giving permission to the governments of Bahrain, Oman and Qatar to initiate their own ferry service to Iraq unless and until the illegal practices of the ferries operating from the UAE first were stopped. We specifically took such action because several successive briefings to Committee members by the Commander of the Multinational Maritime Interception Force (MIF), operating in the Persian Gulf, confirmed with photographic evidence that commercial goods and supplies were being loaded onto ferries in the UAE in direct violation of previously agreed Committee rules governing ferry service. Other 661 Committee members severely criticized us and the British for linking our decision to block Committee approval of ferry service from other Gulf states to the ongoing problems associated with ferry service from the UAE to Iraq. However, we maintained our opposition to new ferry service and requested that steps be taken to compel the government of the UAE to exercise greater control over ferries departing from its ports to Iraq."
http://hsgac.senate.gov/_files/STMTSchweichUNState.pdf

2) TESTIMONY of JUAN CARLOS ZARATE, Assistant Secretary, Terrorist Financing and Financial Crimes, US Department of Treasury, Hearing Before the Permanent Subcommitte on Investigations, 11/15/04:

"We continue to identify key individuals and entities who acted as operatives for Saddam Hussein. The Department of the Treasury has designated now 232 individuals, parastatals and front companies that formed part of the Hussein financial network pursuant to Executive Order 13315. Almost all of these names have been listed by the United Nations 1518 Committee, which is responsible for
maintaining the list of Hussein-related entities. Mr. Chairman, two such designated front companies bear mentioning in the context of this hearing. On April 15, 2004, the Treasury Department designated Al Wasel and Babel Company, a UAE-based company, as a front for the Hussein regime. This company was controlled by, and acted on behalf of, senior officials of the former Iraqi regime. The Iraqis used this company to engage in OFF-related transactions and kickbacks, and also to attempt to procure restricted items, including a sophisticated surface-to-air missile system."
http://a257.g.akamaitech.net/7/257/2422/11apr20051000/www.access.gpo.gov/congress/senate/pdf/108hrg/97048.pdf

Keep up the great research.

4:29 AM, February 25, 2006  
Anonymous Joy said...

Hello RHG, and welcome to Randall's blog! I saw this response over at Kos, but I slept late and the diary's off the rec list now. Things are much more leisurely here, so there's room for discussion of your points. I did mention that the perceived terrorist 'threat' in this is debatable, so it should be debated...

a) a recognition of the Taliban pre-9-11

This isn't a real factor in anything but the divided loyalties and "mixed messages" UAE sends in order to play on both sides of the street. Part of the profile of who's who in the prospectus. Had the Taliban allowed the Bushies to build that pipeline they wanted so badly, the US government would have recognized them too in spite of 9-11.

It seems to me that in the strange ideological circus staged in the ME/central Asian region the Taliban - and Osama himself - represent a sort of political Haj to the movers and shakers of the primary royal houses. Osama being the notable member of the house of Saud who went off to join the 'priesthood' - which for Islam means either 1. becoming an Imam and leading a flock, or 2. becoming a 'soldier for Allah' and embracing the tenet of Jihad. Either way it's considered holy, the Taliban represented the kind of theocracy the jihad tenet represents, so hanging out with the guru on his mountain is sort of like the Beatles and their Swami. The rabble are impressed by their leaders' piety, and the royals get to hunt with falcons.

Don't forget that it was our government who trained, armed and supported Osama and his troops during the Soviet occupation of Afghanistan. Bush likes him, has allowed him to escape more than once, and will use him again if the terror card needs playing. Bush considers himself royalty, and "Unc'a Bandar Bush" is closer to his heart than the American people.

b) money laundering through UAE banks

Oh, heck! Our own banks launder dirty money regularly, though new regulations are making it more difficult. So we've got offshore banks to do that too. A lot closer to home than Dubai! Dubai's royal house doesn't keep business records - the currency of big biz is gold bullion. This is why the ports deal waved the requirement for keeping a set of books here in the US that could be inspected and/or subpoenaed by our regulators and court system.

Gun-running (Dubai hosts a popular arms faire every year, where everybody who's anybody can buy anything they can afford), drug smuggling, piracy, human trafficking... it's a regular "Pirates of the Carribean" thing, only these pirates speak Arabic. The Straits of Hormuz are highly strategic, so it's natural for the powers that be to exploit its possibilities. But since you can't buy major western corporations in vital industries with gold bullion, there has to be a way to turn it into paper for re-investment in legitimate enterprises. Who else but the Dubai royals to establish (and own, and operate) the regional banking system? This alone isn't a kill factor in the P&O deal, since our money is often just as bent.

See nifty details on this aspect over on Randi Rhodes' site - UAE Central Bank and 9/11 Financing.

c) three of the 9/11 terrorists came from the UAE

...and two came from Dubai itself. I'm sure you've seen the Moussaoui indictment listing of Dubai financing and legal links - UAE passports were held by three hijackers as well as Mussaoui's handlers. This IS a deal-killer in my opinion.

Now, the exotic, pirate-like atmosphere of Dubai has served the country well and greatly enhanced its reputation as a fun tourist destination. There's nothing wrong with this, since I live in NC and a big part of our tourist industry on the Outer Banks is pirate-related. All the knick-knacks and doo-dads - treasure maps, eye patches and pirate hats, Blackbeard memorabilia, etc. (made in Taiwan) bring in lots of needed cash. And as Americans, we should be familiar enough with Capitalism by the time we finish high school to understand that laissez-faire always rules the roost - even when regulation attempts to keep things honest. Piracy has always been a 'noble profession' if you're not the victim.

But we really should examine the idea of turning over 21 of our nation's vital ports to pirates. The way big business works these days ensures ownership is going to be foreign even though management may be American. The particulars of container shipping complicate the situation as well, and I think there ought to be a regulatory system specific to those particulars even for US companies!

However, this particular deal was supposed to slip right past oversight and that's utterly dishonest. Nobody would have noticed if DPW hadn't bragged about it as a done deal before it was actually done. It's a "Custer Moment," and we should use it to our advantage. That's what my timeline and links are useful for, and there's a whole lot more that can be included on top of that timeline (I'll get to work...).

Thanks again for response, and if you've more points to make, please do! §:o)

1:50 PM, February 25, 2006  
Anonymous Joy said...

Thanks so much for your comment and great source quotes as well, joejoejoe. I think it's entirely clear this deal is crooked as heck, and that turning over our port operations to UAE (or even just the Sheik of Dubai's #1 son) is so close to high treason that it should justify tossing the entire admin out on its collective ear. Some of the players also need to go to prison, but that's not likely.

In the Arms Trade News link in my post ("Meanwhile, back in the UAE"), it's clear that the UAE military - and this includes Kuwait - has been buying equipment and weapons for a long time that it doesn't really need. Of course, a lot of this stuff goes to the open market arms faire every year, and I do NOT suppose they care who buys 'em. Have you seen Lord of War with Nicholas Cage? Very timely, and a good view of how high-level gun-running works. I highly recommend it.

Anyway, it's the psychology of this whole mess that fascinates me even more than the sordid details. High finance isn't my forté, but I did think these details needed to be collected, itemized and put into a timeline somewhere that would remain available for future reference.

The psychology includes both the 'culture of corruption' that allows this deal to receive CFIUS approval even though chairman Snow claims he knew nothing about it, and allows GWB to throw a childish temper tantrum about Congressional resistance even though he claims he didn't know anything about it either! These folks are such crooked, bald-faced liars that every word that comes out of their mouths needs to be disinfected before public consumption. The working presumption needs to be that they're screwing us by everything they do. A sad commentary on contemporary Amerikan politics, for sure.

But the true "Custer Moment" on this one - and it's historical in sheer audacity and impact - was that these idiots are so completely isolated from the people they govern that they didn't realize the xenophobic hatred of Muslims and utter terror of another 9-11 attack would quite naturally cause this very sort of backlash against the deal! They've been whipping up fear and loathing 24-7 for 4.5 years, and suddenly they tell us not to worry about national security? That's insane!!!

Sure, they really ARE the 'Arabs', and they've never been afraid - heck, they LET 9-11 happen just to enable their plans for world domination. Now they're stuck having to either explain why they lied (which they'll never do), or take public outrage on the chin because they totally deserve it. Either way, they're toast. It's about damn time, IMO.

1:53 PM, February 25, 2006  
Blogger Uncle Wheelie said...

Dear Joy,
It seems to me that the entire Dubai Ports scenario is an attack on America. And a big one. There is every reasonable possibility that if DPW takes control of the 6 (or is it 21) ports, then there will be some serious strife at the docks and in Mom and Pop America as well. Serious strife. And it could easily escallate (I sincerely hope this doesn't happen). But -- what better way to attack the enemy than to have the enemy attack itself while you just sit back and watch it on CNN (or Fox, if you really want the straight poop - and I do mean poop).
The Terrorists Strike Again
Strike One: Even just the mention of the idea that an Arab nation is going to control American ports sends bolts of fear and confusion throughout the hearts and minds of Mom and Pop America. Big bolts. Big fear. Big confusion.
Strike Two: The announcement by BushCo that the W didn't even know about the deal until just a few days ago, boggles the minds of Mom and Pop America.
Strike Three: Many God-fearing, right-living, decent, good old Republican Moms and Pops cannot accept the idea that the President did not know about this deal. It creates, or at the least it amplifies, their cognitive dissodence (because in their heart of hearts, they know that W is, well, how about I just say he's horrible and let it go at that. That amount of increased confusion creates a proportional increase in fear and an inversely proportional increase in instability.
Strike Four: The DPW deal goes thru despite every sane mind in the country opposing it. This is the direct hit.
Strike Five: It starts with a large group of longshoremen and similar dock workers gathering together to address their concerns. And it expands from there. Tensions mount. Tempers flair up. Outright war in the streets. Americans attacking Americans on American soil.
Strike Six: Martial law is declared. Constitution suspended.
I do hope this far-flung scenario is just that: a very far-flung scenario, and nothing more.
- Uncle Wheelie

8:18 AM, February 26, 2006  
Blogger Uncle Wheelie said...

Dear Joy,
It seems to me that the entire Dubai Ports scenario is an attack on America. And a big one. There is every reasonable possibility that if DPW takes control of the 6 (or is it 21) ports, then there will be some serious strife at the docks and in Mom and Pop America as well. Serious strife. And it could easily escallate (I sincerely hope this doesn't happen). But -- what better way to attack the enemy than to have the enemy attack itself while you just sit back and watch it on CNN (or Fox, if you really want the straight poop - and I do mean poop).
The Terrorists Strike Again
Strike One: Even just the mention of the idea that an Arab nation is going to control American ports sends bolts of fear and confusion throughout the hearts and minds of Mom and Pop America. Big bolts. Big fear. Big confusion.
Strike Two: The announcement by BushCo that the W didn't even know about the deal until just a few days ago, boggles the minds of Mom and Pop America.
Strike Three: Many God-fearing, right-living, decent, good old Republican Moms and Pops cannot accept the idea that the President did not know about this deal. It creates, or at the least it amplifies, their cognitive dissodence (because in their heart of hearts, they know that W is, well, how about I just say he's horrible and let it go at that. That amount of increased confusion creates a proportional increase in fear and an inversely proportional increase in instability.
Strike Four: The DPW deal goes thru despite every sane mind in the country opposing it. This is the direct hit.
Strike Five: It starts with a large group of longshoremen and similar dock workers gathering together to address their concerns. And it expands from there. Tensions mount. Tempers flair up. Outright war in the streets. Americans attacking Americans on American soil.
Strike Six: Martial law is declared. Constitution suspended.
I do hope this far-flung scenario is just that: a very far-flung scenario, and nothing more.
- Uncle Wheelie

8:19 AM, February 26, 2006  
Blogger Uncle Wheelie said...

"it should justify tossing the entire admin out on its collective ear"

Oh, let's do that today!

8:22 AM, February 26, 2006  
Blogger Uncle Wheelie said...

REVISED PARAGRAPH (to correct a syntax error and a typo):

Strike Three: Many God-fearing, right-living, decent, good old Republican Moms and Pops cannot accept the idea that the President did not know about this deal. It creates, or at the least it amplifies, their cognitive dissidence (because in their heart of hearts, they know that W is, well, how about I just say he's horrible and let it go at that. That amount of increased confusion creates a proportional increase in fear and a proportional increase in instability.

8:41 AM, February 26, 2006  

Post a Comment

Subscribe to Post Comments [Atom]

Links to this post:

Create a Link

<< Home