- The Washington Times - Thursday, June 1, 2006

Roy Blunt, Deborah Pryce, Carolyn Maloney and Joseph Crowley

Many Americans were outraged with the announcement in mid-Februaryofthe planned $6.8 billion purchase of Peninsular & Oriental Steam Navigation, a London-based port operation company, by Dubai Ports World. As part of the proposed deal, management of commercial operations at six ports along the Eastern seaboard of the United States and Gulf of Mexico — including New York, Miami, and New Orleans — would have been transferred to DP World, a company owned by the government of Dubai, a member of the United Arab Emirates.

Regrettably, the deal was not properly vetted for security risks andCongressionalleaders learned of it the way most Americans did — through newspaper accounts of the transaction.

During the subsequent uproar, the loudest cries have come from many in Congress demanding that the government mechanism for reviewing foreign acquisitions that could impact America’s security — the Committee on Foreign Investment in the United States — be radically re-worked. Without question, the CFIUS process must be improved.

Additionally, as Congress considers potential reforms, our goal must be to achieve the dual objectives of ensuring national security while preserving America’s global economic leadership.

The U.S. economy benefits from foreign investment, which totaled $129 billion last year, up 20 percent from 2004. It also benefits from the ability of American investors to buy and sell companies in other countries. Roughly 5 million Americans — one out of every 20 employees in this country — work for a foreign-based company. American workers and investors gain from a global economy that maximizes the value of the companies they work for and invest their pension funds or IRAs in.

Any reform of the CFIUS process must acknowledge these economic realities, keeping in mind that no cross-border business deal is worth risking the safety of the American people. The best reform will keep Americans secure while avoiding a chilling effect on foreign investment, the likely results of which would include higher interest rates, lower equity prices, slower economic growth and fewer American jobs.

The United States is the world’s largest investor, with over $10 trillion in assets overseas. Impeding or delaying legitimate foreign investment with no bearing on our national security would invite retaliation by other countries, at great cost to U.S. investors, producers and consumers.

Working in a bipartisan fashion, Congress will augment and improve the CFIUS process to meet the challenges of a post-9/11 world. To ensure national security, we should require a mandatory 45-day investigation for any proposed acquisition by an entity controlled by a foreign government.

We should ensure that all relevant federal agency heads are included in the CFIUS review process. Strict accountability must be enforced by requiring the chair and vice chair of CFIUS to sign all committee decisions, and any dissenting vote on the committee must trigger a final decision by the president. We should enhance the certainty and predictability of the review process by establishing a regular-order paper trail for the submission, withdrawal and resubmission of applications, while at the same time providing the strictest statutory protection of proprietary business information.

Any legislation reforming the CFIUS process must improve communication between CFIUS and Congress by requiring that the appropriate committees receive timely notification and regular reporting on the activities of CFIUS and trends in foreign acquisitions.

Congress has no more important duty than to ensure the security of our nation. After all, there can be no economic security without national security. At the same time, attracting the global capital that our economy needs more than ever requires open, stable, and predictable markets. While the United States remains the world’s premier destination for foreign investment, we must be aware of the mounting competition from other markets around the globe. A retreat from open markets would also jeopardize U.S. efforts to open foreign markets to American investors and companies.

Protecting America and preserving our open engagement with the global economy are not mutually exclusive priorities. Working in a bipartisan manner, Congress can and will accomplish both.

Rep. Roy Blunt is House Majority Whip, Rep. Deborah Pryce is GOP Conference chairwoman, Rep. Carolyn Maloney is ranking member of the Joint Economic Committee and Rep Joseph Crowley is Minority Chief Deputy Whip.

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