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Who owns the United States ports?

Hardball Correspondent David Shuster investigates the transfer of control of six major US ports to a firm owned based in the United Arab Emirates.
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On board Air Force One on Tuesday, President Bush said the deal to put U.S. port facilities under the ownership of a company run by an Arab government is legitimate and should go forward.

The president added that if Congress tries to block the transaction, “I‘ll deal with it with a veto.”  That veto would be the president‘s first since taking office.

Every day nearly 26,000 shipping containers arrive in U.S. ports, and with the U.S. government inspecting only one out of 20 containers, the responsibility for screening the rest belongs to the company that owns and runs the port‘s terminal operation. 

Robert Menendez, the new senator from New Jersey, warned, "These are critical assets of the United States, both for its security and its economy, and it should not be run by foreign government."

The fear is that a terror organization will slip in a nuclear weapon and destroy an American city.  So how did the sale of the ports get approved and who approved it?  The U.S. government reviews these purchases through what is known as the Committee on Foreign Investment in the United States. 

The committee is chaired by Treasury Department Secretary John Snow, and it includes senior officials from the departments of Defense, Justice, Commerce, State, and Homeland Security.  The $6.8 billion deal approved by the panel covers the ports of New York, Newark, Philadelphia, Baltimore, New Orleans and Miami.  The operations in these ports are already being run by a British company, Peninsular and Oriental Steam Navigation Company, known as P & O. 

P & O was bought last week by Dubai Ports World, a business owned and operated by the government of United Arab Emirates.  The Bush administration considers the U.A.E. an ally in the war on terror, but the 9/11 Commission found that some of the money for the terror attacks went through banks located in the Arab Emirates and two of the hijackers were, for what it‘s worth, from the U.A.E. 

Peter Gadiel who lost a son on 9/11 said, "It‘s simply beyond belief that the president would tolerate this kind of insanity."

And on top of the issue of terrorism, a State Department report declares, “The United Arab Emirates is believes to be a transshipment point for traffickers moving illegal drugs from the major drug producing countries, especially Afghanistan, westward. Frequent reports of seizures of illegal drugs in the UAE during the past year underscore this conclusion.”

President Bush‘s spokesman is defending the port deal, noting the number of government agencies involved in reviewing it.  White House Press Secretary Scott McClellan, told the press core "Department of Homeland Security, the Department of Defense, the Justice, among others, and there is a rigorous review that goes on for proposed foreign investments of national security concerns."

Michael Chertoff, Homeland Security Secretary, is assuring Americans there are safeguards in place.  Though he won‘t reveal what they are, because they‘re secret. 

But lawmakers are asking the Bush administration to spell out those conditions and concerns and explain why the deal is not a security risk.  Two members of the Bush administration have dealt before with the U.A.E. company Dubai Ports World.  Treasury Secretary John Snow was formerly the chairman of the CSX rail firm.  After Snow left CSX, Dubai Ports World bought the rail firm‘s international port operations for more than a billion dollars. 

David Sanborn was picked last month by the president to head the U.S.  Maritime Administration, before that, Sanborn worked for Dubai Ports World, running their operations in Europe and Latin America. 

The ports that are part of this deal are responsible for 40 percent of the U.S. Army‘s equipment being shipped overseas, including to places like Iraq.  It‘s another reason members of Congress, including Republicans, are drafting legislation to block this deal and stop all foreign ownership of U.S. ports.

Even longtime supporters of President Bush are publicly pleading with him to change course before his formal approval of this transaction goes into effect next week. 

Watch each night at 5 and 7 p.m. ET on MSNBC.