Dubai Ports World, Halliburton, and our democracy

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Posted on February 27, 2006
Filed Under Justice, Ecological overshoot, Fossil fuel dependency

What is behind the plaintive “What’s the big deal” complaint we hear from administration officials about the sale of operations at 6 major US ports to a company owned by the emir of Dubai and his government?  Some journalists have drawn the map for us.  It should probably not surprise us by now, but we find behind this deal some pretty interesting relationships among Dubai Ports World, the United Arab Emirates (U.A.E.), the Bush family, and other top officials in the Bush administration.  Among the brave few reporting on this is Lou Dobbs, and I recommend reading the entire transcript from his show, The Lou Dobbs Show, 2/22/06: 

http://transcripts.cnn.com/TRANSCRIPTS/0602/22/ldt.01.html

In a nutshell:

The U.A.E. is a major investor in the Carlyle Group, which, reports Christine Romans of CNN, is “the private equity investment firm where President Bush’s father once served as senior adviser and is a who’s who of former high-level government officials. Just last year, Dubai International Capital, a government-backed buyout firm, invested in an $8 billion Carlyle fund.” 

Hmmmmm.  Okay, there’s more: “Another family connection, the president’s brother, Neil Bush, has reportedly received funding for his educational software company from the UAE investors. A call to his company was not returned.”  Quite. 

Other facts that have come out:  US Treasury Secretary John Snow was former chairman and CEO of the railroad company CSX.  Romans reports: “After he left the company for the White House, CSX sold its international port operations to Dubai Ports World for more than a billion dollars.”  Like the president, Snow said he knew nothing of the sale until reading about it in the newspapers (actually, I take that back.  Bush doesn’t read newspapers, he must have heard about it some other way). 

Dubai Ports (DP) World acquired CSX’s international terminal business “for a cash consideration of US $1.5 billion,” according to a DP press release in December 2004 (DP World Website).

And this:  “Another administration connection, President Bush chose a Dubai Ports World executive to head the U.S. Maritime Administration. David Sanborn, the former director of Dubai Ports’ European and Latin American operations, he was tapped just last month to lead the agency that oversees U.S. port operations.” 

It was late last year that DP World made its bid to purchase Peninsular and Oriental Steam Navigation Company ( P&O), the British owned company that has been running the six US ports, and many others around the world.  Responding to accusations that objections to the deal amounted to anti-Arab racism, Dobbs pointed out the difference between the two companies:  “Peninsula and Oriental Steam Navigation is a British privately owned company. Dubai Ports World is a UAE government controlled and owned company. You see the difference, of course.”  Apparently some don’t. 

As for the Carlyle Group, back in February 2003, they announced that they had completed “the conveyance of CSX Lines, LLC, from CSX to a venture formed with The Carlyle Group. CSX received $300 million, consisting of $240 million in cash and $60 million of securities issued by the venture.”

Seems like a lot of money flowing through incestuous corporate relationships among people who are also in positions of political power in Washington.  Which could bring one to ask:  in whose service are these deals being done – yours and mine? 

Alongside this unseemliness, there was an article in the New York Times this morning about the very special relationship between the US military and Vice President Dick Cheney’s old corporation, Halliburton (Cheney was the company’s CEO before he became veep).  As you know, Halliburton’s subsidiary, Kellogg Brown & Root, was given a no-bid contract to rebuild Iraq’s oil industry infrastructure and to deliver fuel.  It is being audited by the Pentagon because of accusations that it has ripped off US taxpayers through gross overcharges billed to the US government.  According to the Times, Pentagon auditors have “identified more than $250 million in charges as potentially excessive or unjustified”  (NYTimes, 2/27/06). 

Well, the Army has now said that it will reimburse KBR for nearly all these excessive charges.  “…the Army is withholding payment on just 3.8 percent of the charges questioned by the Pentagon audit agency, which is far below the rate at which the agency’s recommendation is usually followed or sustained by the military…”  The rate is usually more like 66-75 percent.

This is our tax money at work, enriching corporations with intimate ties to people in the Bush administration, including the Bush family.  One might get the idea that the government is being run for personal enrichment – which might also raise questions about just what, or who, it is that soldiers are dying for in Iraq.

Added note, in case you missed this story, Halliburton/KBR was also just given a $385 million contract to build detention centers in the United States (NY Times, 2/4/06 – sadly access to this article is restricted now to paid subscribers).  According to the contract, KBR will prepare for “an emergency influx of immigrants,” or special emergencies such as natural disasters like Hurricane Katrina.  And what other emergencies might be considered “special?”  One fears to ask – but we should.

But my point here is this: our democracy is seriously compromised by the power of these corporations, corporations rooted in the energy business, the defense industry, and global transport.  They control lobbying firms, write policy passed on to Congress in the form of legislation, and they contribute to political campaigns to get their people elected to office.  They have a great deal of power over our lives, but are not accountable to us.  They are consolidating a lot of power into their hands, taking vital decisions out of the domain of government where they belong – accountable, open, democratic government.

These people know as well as we do the turbulent times that lie ahead around peak oil and looming energy shortages, resource depletion, climate change, and more.  They are preparing, and they are preparing in part by taking power away from us to make different decisions, decisions based on the common good.

The roots for any hope of changing this culture of corporate greed, corruption, and power-abuse lies in our reclaiming, as a people, all of us from the bottom up, the priority of the common good over private enrichment, and the welfare of peoples over the concentration of wealth and power among the few.

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