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White House: Bush didn't know about ports deal until after it was approved

Thursday, February 23, 2006

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 Wednesday.

Defending the deal anew, the administration also said 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 involving the sale of a British company to the Arab firm.

Dubai Port's top American executive, chief operating officer Edward H. Bilkey, said the company will do whatever the administration asks to enhance shipping security and ensure the sale goes through. Bilkey said Wednesday he will work in Washington to persuade skeptical lawmakers they should endorse the deal. At least two Senate oversight hearings already are scheduled.

"We're disappointed," Bilkey said. "We're going to do our best to persuade them that they jumped the gun. "The UAE is a very solid friend, as President Bush has said."

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 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." He said the matter did not rise to the presidential level, but went through a congressionally mandated review process and was determined not to pose a national security threat.

"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.

Commerce Secretary Carlos Gutierrez said: "They are not in charge of security. We are not turning over the security of our ports. When people make statements like that you get an instant emotional reaction."

Treasury Secretary John Snow said failure to complete the transaction would send the wrong message overseas.

"The implications of failing to approve this would be to tell the world that investments in the United States from certain parts of the world aren't welcome," Snow told reporters Wednesday following a speech in Connecticut to a fuel cell manufacturer. "That sends a terrible message."

The sale's harshest critics were not appeased.

"I will fight harder than ever for this legislation, and if it is vetoed I will fight as hard as I can to override it," said Rep. Pete King, R-N.Y., chairman of the Homeland Security Committee. King and Democratic Sen. Charles Schumer of New York said they will introduce emergency legislation to suspend the ports deal.

McClellan dismissed any connection between the deal and David Sanborn of Virginia, a former senior DP World executive whom the White House appointed last month to be the new administrator of the Maritime Administration of the Transportation Department. Sanborn worked as DP World's director of operations for Europe and Latin America.

"My understanding is that he has assured us that he was not involved in the negotiations to purchase this British company," McClellan added.

"In terms of David Sanborn, he was nominated to run the Maritime Administration because of his experience and expertise," the spokesman said. Sanborn is a graduate of the U.S. Merchant Marine Academy. He is an operations professional.

Earlier, several lawmakers determined to capsize the pending sale said they would not be deterred by Bush's veto threat.

Sen. Joseph Biden, D-Del., said the bipartisan opposition to the deal indicated "a lack of confidence in the administration" on both sides. "Sure, we have to link up with our Arab friends but ... we want to see and those in Congress want to know what ... safeguards are built in," Biden said on ABC's "Good Morning America."

Bush's veto threat sought to quiet a political storm that has united Republican governors and Senate Majority Leader Bill Frist of Tennessee with liberal Democrats, including New York Sens. Hillary Rodham Clinton and Schumer.

To assuage concerns, the administration disclosed some assurances it negotiated with Dubai Ports. It required mandatory participation in U.S. security programs to stop smuggling and detect illegal shipments of nuclear materials; roughly 33 other port companies participate in these voluntarily. The Coast Guard also said it was nearly finished inspecting Dubai Ports' facilities in the United States.

Frist said Tuesday, before Bush's comments, that he would introduce legislation to put the sale on hold if the White House did not delay the takeover. He said the deal raised "serious questions regarding the safety and security of our homeland.

House Speaker Dennis Hastert, R-Ill., asked the president for a moratorium on the sale until it could be studied further.

Lawmakers from both parties have noted that some of the Sept. 11 hijackers used the United Arab Emirates as an operational and financial base. In addition, critics contend the UAE was an important transfer point for shipments of smuggled nuclear components sent to Iran, North Korea and Libya by a Pakistani scientist.


Associated Press writers Ben Feller, Will Lester, Terence Hunt, and Devlin Barrett in Washington, Matthew Verrinder in Newark, N.J., and Tom Stuckey in Annapolis, Md., contributed to this report.


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