- The Washington Times - Saturday, February 25, 2006

The White House yesterday welcomed the offer by a Dubai-owned company to indefinitely postpone operating in six major U.S. seaports, saying it would use the time to allay homeland security concerns voiced by both parties.

“Some additional time or a slight delay will be helpful in the sense it will give us more time to brief members of Congress, but the president was very clear: He believes this transaction should be allowed to move forward,” Bush spokesman Scott McClellan said.

Mr. McClellan said the president will veto any legislative effort to block the transfer of terminals from a British to a Middle Eastern company, Dubai Ports World (DPW), and the president’s national security adviser later said the deal will not be reopened.

“There are questions raised in the Congress, and what this delay allows is for those questions to be addressed on the Hill,” National Security Adviser Stephen J. Hadley. “There’s nothing to reopen.”

Sen. Barbara A. Mikulski, Maryland Democrat, yesterday that she and Sen. Charles E. Schumer, New York Democrat, would introduce legislation to impose a delay and enable Congress to vote to overrule the decision.

“I don’t know if [Treasury] Secretary [John W.] Snow stands to profit by increased stock options or a fatter pension,” Miss Mikulski told her state’s Democratic leadership, which met to discuss the deal’s impact on the Port of Baltimore. “But I do know a rigorous inquiry is needed.”

Rep. Peter T. King, New York Republican and chairman of the House Homeland Security Committee, called the postponement “a positive step,” but said the president still must disclose new details about the administration’s review and approval of the agreement last month.

There remained confusion yesterday within the administration over which agency led a review of the deal when the 12-member Committee on Foreign Investments in the United States (CFIUS) approved it.

After The Washington Times reported that Homeland Security Secretary Michael Chertoff was not aware of the review until after the sale was approved, his spokesman, Russ Knocke, disputed a part of The Times story that said Homeland Security played the lead review role.

Mr. Knocke said the Treasury Department was the lead agency. But Treasury spokesman Tony Fratto said that in each CFIUS review, one agency is picked to lead it, and in this case it was Homeland Security because the issue dealt with seaport security. Defense Secretary Donald H. Rumsfeld also has said Homeland Security was the lead agency.

None of the CFIUS members, including six Cabinet secretaries, objected to the deal, which Mr. Bush did not know about until after its approval.

DPW said late Thursday that it would move forward with its $6.8 billion purchase of Peninsular & Oriental Steam Navigation Co. (P&O;) on Thursday, but would not “exercise control over, or otherwise influence, the management of P&O;’s U.S. operations pending the outcome of these further discussions.”

P&O; operates port terminals in New York, Baltimore, Miami, New Orleans, Philadelphia and Newark, N.J.

Mr. McClellan told reporters at the White House yesterday that the duration of the delay was “not up to us; it’s up to the company to make that decision.”

Meanwhile, the owner of Port Newark filed a lawsuit in New Jersey to block the sale, citing security concerns. The Port Authority of New York and New Jersey said the deal violates a 30-year lease signed with the authority in 2000.

The lawsuit, filed yesterday in state Superior Court in Newark, asked a judge to block the sale on the grounds that any such deal required the authority’s consent.

In England, a U.S. company filed a court petition yesterday also seeking to block the sale.

Sen. Robert Menendez, New Jersey Democrat, said the company’s offer “isn’t worth the paper on which it is written.”

“If the Bush administration will not stop this deal from closing, Congress must,” Mr. Menendez said.

While Democrats opposed the deal, it was opposition from top Republican lawmakers that surprised the White House. Both House Speaker J. Dennis Hastert of Illinois and Senate Majority Leader Bill Frist of Tennessee voiced concern over the deal and called for at least a temporary delay to examine the terms of the sale.

Maryland Gov. Robert L. Ehrlich Jr., who initially voiced outrage over DPW’s purchase, applauded the delay.

“For those that bother to learn the facts, the comfort level has increased,” Mr. Ehrlich, a Republican, said while attending a summit in Linthicum, Md., on the pandemic flu threat.

“There was a lot more consideration [by federal agencies] than originally known,” he said.

Sen. Patrick J. Leahy of Vermont, ranking Democrat on the Senate Judiciary Committee, yesterday asked Attorney General Alberto R. Gonzales for more information on the administration’s approval of the ports deal.

“The administration should have recognized that an unprecedented sale of this size and scope requires extraordinary precautions to ensure that appropriate security safeguards are in place at all of our ports,” he said.

“Instead, they rushed through and rubber-stamped a secret review, and now they once again ask us to trust their vague assurances that adequate national security arrangements are in place.”

Rowan Scarborough, S.A. Miller and Jerry Seper contributed to this report.

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