Tuesday, February 21, 2006

Shouldn't That Raise the Threat Level to Orange?

by Joe Miller

I'm not quite sure what exactly to make of the news that President Bush has signed off on a plan to outsource running six U.S. ports to a subsidiary of the government of the United Arab Emirates. Granted, when it comes to hating Americans and breeding Islamists, the UAE isn't in the same league as Iran or Afghanistan or even Saudi Arabia. Still, the UAE isn't exactly the most reliable of allies, and the company in question, while a for-profit company, is still state-controlled. It's not beyond the limits of reason to think that perhaps a state-run company might perform some action that is in the interest of the state even when doing so runs counter to making a profit.

The claim that allowing a UAE state-controlled company to control U.S. ports is completely analogous to allowing a completely-private British company to control those same ports is, to use the technical logic term, a shitty analogy. Not all foreign companies are the same, particularly when one of them is really an arm of Dubai.


Anonymous jamie mccall said...

I think this is interesting because I can imagine what sort of situation Bush would be in if he DIDNT allow this.

Because then, wed be *country profiling*. Which would cause calls of bigotry and racism.

So he supports the sale, and then hes supporting terrorism.

No way to win on this one.

7:32 AM  
Anonymous Andreas Broscheid said...

I share the sentiment expressed by Joe and Jamie. I don't know which responsibilities the company will have, but I understand that port security will continue to be in the hands of the coast guard. And I understand that the operations to be "sold" have been in the hand of a British company. If a company from the NAE is not safe, why is a British company?

Jamie, Bush could win this one politically by proposing a US-only policy for port operations. Does anybody know which other port operations are in foreign hands?

7:44 AM  
Anonymous andreas broscheid said...

... and I can answer my own question. From today's Washington Post:

"Dubai Ports World is one of several foreign giants that operate terminals in ports around the globe; other big companies are from Denmark, Singapore, Taiwan and South Korea. Few U.S. terminals are managed by American-owned firms."

The article is worth reading.

8:05 AM  
Blogger Matt McIntosh said...

This whole thing is ridiculous. We're only talking about a change in capital ownership here, and even though DPW is "state-owned" it's run like a regular multinational corporation, and by all accounts a respectable one. As has already been pointed out, most ports aren't managed by domestically-owned firms anyway and security has always been and will continue to be the purview of the Coast Guard. This whole thing is just naked Arabopobia.

3:56 PM  
Blogger Rick said...

Article 1 Section 8 of the Constitution grants to Congress the power "to regulate Commerce with foreign Nations". If Congress wants to slow down and take a better look, its their job.

4:38 PM  
Blogger Joe Miller said...


I agree with you that most of the furor is naked Arabophobia. My post was meant to be at least a touch ironic, but that perhaps didn't come through as well as it did inside my head.

I would want to suggest, however, that there really is a substantial and important distinction between public or private corporations and state-owned corporations. As libertarians are fond of pointing out, the motivations for government officials are often quite different from the motivations of the market.

My objection, then, is not really to the fact that the company in question is owned by the UAE. I'm actually with Kevin Drum who thinks that the whole UAE business demonstrates a stunningly tone-deaf administration but is otherwise a red herring.

Rather, my objection is to the fact that the company in question is state owned. It's not a question of whether the motivations of a state-owned company have always before lined up with typical capitalist motivations. It's more a question of whether we can reliably expect them to continue to do so.

And since I can't resist the opportunity for just a tiny bit of snark, I'd just like to say that since you've now decided that being state-controlled isn't really in and of itself a reason to object to a business, I'm really looking forward to reading a stirring defense of NASA, public education, the NEA/NEH (take your pick) and all sorts of other government-run industries over at your place.

5:42 PM  
Blogger Matt McIntosh said...


You'd have done better without the snark. Saying that a state-owned company ought not be prevented from purchasing a private entity doesn't obligate me to defend state-owned enterprises in general, and you know it.

But more generally, I've gravitated toward the fairly "nominalist" position that Will Wilkinson calls Neutral Institutional Monism, which implies a rejection between any hard dualism between states and firms. If it walks like a duck and quacks like a duck, etc.

In this particular case I don't think your objection is well-founded. Not only is the UAE gov not appreciably less trustworthy or responsible than say, Germany, but if anything their incentives toward responsibility are stronger. I'll be lazy and hand this one over to the Knappster:

"Now, let's imagine what happens if Dubai Ports World screws up -- through action, inaction, error, negligence or any other failure -- and terrorists utilize one or more of those ports in conducting attacks on the US. There won't be fines. There won't be a few random jailings of culpable executives. Instead, the State Department will add the UAE to its list of state sponsors of terrorism, the President of the United States will freeze and/or seize not just the Dubai Ports World investment, but every UAE asset in the United States, and the armed forces of the United States may just decide to locate a shiny new crater where Dubai used to be.

Now, tell me: Which company do you think is going to be more particular about genuine port security?

That's not by any means all, of course. It's just the stick. Here's the carrot:

By making the UAE a multi-billion-dollar trading partner, the US gives the UAE a stake in the success, rather than the failure, of the US. That's a built-in incentive to be helpful rather than harmful to the US."

By the by Joe, since turnabout is fair play, I look forward to your spirited denunciation of NASA, public schooling, etc. :)

8:51 PM  
Blogger Joe Miller said...


That's a challenge that's easy enough. I'd very much like to privatize space exploration. A great many of our resource, energy and pollution problems here on the planet could be solved by more efficient exploitation of space. NASA is very clearly not making any progress on that front, so let's turn it over to Boeing and USX and GE and whomever else might get things in gear.

As for schools, I'm a fan of competition among different types of schools. Let's hear it for charter schoos, for private schools, for religious schools, etc. Let the good ones survive and the crappy ones go away. Of course, I'm not actually a libertarian, so I do think that everyone is entitled to an education. If you can show me a voucher program that actually provides adequate funds for even the poorest kids to actually afford private school tuition, then I'd be willing to consider supporting that. As far as I can tell, though, actual programs on offer would amount to subsidies for the almost-rich to attend private school.

And before you haul out the statistics about average private school tuition and average voucher plans, I've seen it. Don't forget, though, that there are a lot of really crappy private schools out there that don't charge much tuition because, well, they are really crappy. Lots of religious schools survive not becuase they are good schools but because they are heavily subsidized as missions by local churches. They have low tuition; they also are, arguably, far worse schools than the crappy public schools. (For the record, I attended a small Christian school of this sort. My working-class parents could afford it largely because every fundamentalist church in the entire county--and in rural WV that's a lot of churches--gave money to the school.)

The NEA and NEH: not a huge fan of either one. There are plenty of private foundations that support research in the arts and in the humanities. I'm not really sure why we need government foundations also. The NSF certainly funds some good basic science, but there is plenty of money to be made from basic science. Making up funds from the NSF with private funds shouldn't be that tough.

Your turn. :p

10:36 PM  
Blogger Matt McIntosh said...

Well holy crap Joe, I was joking! But actually that's pretty awesome since I basically agree with you (means-tested vouchers for low-income households are actually okay by me). Heck, I don't even have a yen to sell off the NSF, so that's more extreme than me! :)

In the interest of fairness, I'll say a few good things where I can do so honestly. We already know I like the NSF. NASA has given us some pretty damn cool things even though it's long past its heyday. Not just the technology that came out of their research, but a manned moon landing was the right thing to do and libertarian principles be damned. (My secret heresy.) Oh, and the NWS is peachy keen.

Providing education to everyone is a noble idea even though the socialist means chosen were bad, and public schools are not all horrible.

Honesty forbids me from speaking of the NEA or NEH, however. Never saw anything in them, and "if you can't say anything good..."

There. I feel so dirty now... wait, wasn't this supposed to be about ports?!

12:24 AM  
Blogger Joe Miller said...


That wasn't so hard, was it? Perhaps I should post a new motto: "Leading libertarians down the road to statism one small step at a time." Whaddya think?

10:22 PM  
Blogger Matt McIntosh said...

Well you know, I'm not much of a libertarian. Like a friend of mine said in conversation recently, I'm really a liberal; I want to actually help people, rather than looking like I'm helping people while mostly just hurting everyone. ;)

11:10 PM  

Post a Comment

Links to this post:

Create a Link

<< Home