Hello, I'm Mark Pearson. Government reports were mixed this week on assessment of U.S. economic vitality. **Gaining more than one-percent in January, the Conference Board's Index of Leading Economic Indicators rose for the fourth consecutive month. **Meanwhile the Commerce Department reports orders for durable goods declined by more than 10 percent last month, their largest setback in 5 1/2 years. **And the Consumer Price Index rose 7-tenths of one percent last month, due largely to higher energy costs. **The numbers did little to change expectations that the U.S. Central Bank will raise interest rates when it meets in March. Fiscal strategy aside, the Bush administration ran into opposition on other policies this week -- notably a controversial plan allowing a company owned by the United Arab Emirates to take over half-a-dozen key U.S. Seaports.
The Peninsular and Oriental Steam Navigation Company, which operates ports-of-call in the East and South, sold its operating interests to Dubai Ports World, a state-owned company in the United Arab Emirates. The 6.8 billion dollar deal has raised eyebrows on both sides of the aisle. So much so, that by week's end, DP World voluntarily delay the deal, buying time for the Bush administration to presuade Congress there is nothing to fear.
President George Bush: "If there was any chance that this transaction would jeopardize the security of the united states it would not go forward."
Citing worries of homeland security as the number one concern, the immediate reaction of a bipartisan group of lawmakers was to come out against the move.
Hillary Clinton, D- New York: " The process used to review this transaction appears to be cursory at best."
Most notable in this category is Senate Majority Leader Bill Frist. The Tennessee Republican wants the deal put on hold and "a more extensive review conducted." Frist also is planning to introduce a bill to postpone hand-over of the day-to-day operation of the ports in Baltimore, Miami, New Jersey, New Orleans, New York and Philadelphia.
Though security will still be handled by U.S. Coast Guard and Customs officials, members of the Legislative branch are concerned. A recent GAO report revealed that only 1 of every 20 cargo containers entering the U.S. is inspected. In the first six months of last year, more than 1.5 million containers entered the ports of New York and New Jersey" alone.
Democratic Senator Charles Schumer of New York is heading up a small bipartisan group of lawmakers which sent a letter to the President, asking him to reconsider the transaction. The letter expresses concern that the United Arab Emirates has openly recognized the Taliban, has been linked to the funding and planning of 9/11, and has been known to harbor terrorists within its borders. It goes on to state that, even with Homeland Security screening all cargo containers entering these ports, the movement of those containers, as well as the hiring of security personnel, is up to the Port operator.
President Bush countered all objections to the deal.
President George Bush: President George Bush: "What I find interesting is that it's okay for a British company to manage some ports but not okay for a company from a country that is also a valuable ally in the war on terror."
Sen. Ileana Ros-Lehtinen, R-Florida: "There's a lot that should be questioned about this. Remember that two of the hijackers of 9/11 had Dubai connections."
Despite the voluntary postponement by DP World, President Bush has said he will veto any bill to delaying the proposal.