Dubai has Lost Face---How Might it Retaliate?

Friday, March 10, 2006
“If we reject the company in terms of doing the [ports] work, they are going to lose a lot of face. In the Arab culture, losing face is a big deal,” a former government official said. “We risk losing that help. It is not an empty threat.”

“The Emirates Group airline will decide later this year whether it will buy Boeing’s new 787 Dreamliner or its competitor, Airbus A350. The airline last fall placed an order worth $9.7 billion for 42 Boeing 777 aircraft, making Dubai Boeing’s largest 777 customer.”

“Any repercussion to Boeing could put House Speaker Dennis Hastert (R-Ill.) in a delicate position. Boeing’s decision to move its headquarters to Chicago has been seen as calculated to facilitate a close relationship with Hastert. He is against the ports deal, and his office did not return calls by press time.”

Some people contend “that because the ports deal is a national-security issue blocking it would not be in violation of World Trade Agreement rules.” This doesn’t sound right to me. Couldn’t the Dubai government reply that it was more than willing to resolve these issues? What happened to the 45 day period which would have allowed Dubai World Ports to present its side of the case? Don’t we owe them that much? Can a nation willy-nilly employ the excuse of “national security” without being penalized by the World Trade Organization?

I am going to make a bold prediction. The Dubai World Ports agreement will ultimately be approved. What, am I some sort of crazy person? Didn’t the company officially pull out? I suspect the devil is in the details. It only said that it would turn over the managerial functions over to an American firm. There is a major problem with this option: there are no companies in the United States ready to handle these responsibilities! And especially to do so profitably. We are going to see all hell break out in the next few days. The majority of the American public can be persuaded that this deal is not a security threat. Much of its fear and outrage was based on bigotry and misinformation. These decent Americans will soon start to feel ashamed of themselves.


terrye said...

I do not know if they will feel ashamed of themselves, but they should.

Right wing pundits who fought this will poreen and feel they have "arrived', that being they put the screws to the Bush administration. Favorite pastime, why shouldn't the right wingers be just as partisan and emotionally driven as their left leaning adversaries? So they seem to think.

I know I have no intention of every going near Malkin's and LGF again. But I guess that is a small consideration.

The Dubai people said they would relinquish the American part of the deal, if they lost no money in the process. I think they will find away to work through an American company...but will still make the money.

As for retaliation, who knows? I think that many Americans have made it plain to the ME that as far as we are concerned that democracy and free market crap is just propaganda and they are a bunch of camel jockeys and we will use them when it suits us and dump them when it doesn't it.

After all, they are Arabs.

Can that hurt us on the WoT? You betcha. Why would any of them go out on the limb for a country that obviously despises them? Self preservation? Yeah, well, that can work both ways. Being an ally of the Great Satan does not win you many friends in the ME. Now it will win you even fewer.

One thing about this whole episode that I simply did not understand. We are supposed to believe the UAE will not retailiate because they need us. And yet we were also supposed to believe they would ignore that need and allow terrorists to use their company to infiltrate the country and kill Americans. It seems to me that if you believe the latter, it changes the former. If you get my drift.

But right now the Democrats are pissy because the showdown has been averted and that is all the Republicans in Congress care about.

Skookumchuk said...

This from Fox:

The deal in question, however, focused primarily on lucrative Asian markets. DP World valued its rival's [P&O] American operations at less than 10 percent of the nearly $7 billion total purchase.

Remember where the core of international shipping is today. And how far the Americans have fallen behind in this industry. So what is DPW really losing by not running the American terminals? And what are they gaining by not having the headaches of running them?

terrye said...


They are losing the oppurtunity to deal with the Teamsters and Longshoremn Unions.

I think they would not even have bothered with the American ports in the first place if the company had been sliced up. If they have Vancouver, they have a north American port without bothering with DHS...and they still have Asia and Europe.

But the gratuitous Arab bashing that accompanied this can have repercussions. If I were them I would go with Airbus. But then they might not be as spiteful as me.

John Lee said...

Not so fast guys...just because an Arab government makes an announcement doesn't mean it's necessarily so...

LittleGreenFootballs linked to this post at the IRIS Blog:

Dubai Port Capitulation Likely Fraudulent

Fresh Air said...

John Lee--

That IRIS post is retarded, to say the least. I posted a response on LGF last night. It's not worth more pixels here.

Skook, Terrye--

I've done a lot of work with firms in the contract labor industry. Pass-throughs on high injury-rate jobs like stevedoring are not high-margin.

The idea that these guys were going to make a killing of the U.S. ops is pretty silly. I suspect they were taking these pieces as a bit of a favor to the Brits so they could complete the deal. I mean, who would want to deal with the Longshoremen and the Teamsters?

Seneca the Younger said...

Fresh: define "deal with".

("I've got a little list ... not one of them'd be missed.")

CF said...

I think they will form an American subsidiary and set up a wall between the management and ownership. This is frequently done in cases involving foreign military equipment suppliers.

They will make less money on the US ports under such a structure but I believe we have sub rosa indicated to them that we will find a way to compensate them for their losses.

I wonder if Clinton will not regret her role in this. I doubt it gained her as much as it cost her:Raising the awareness of the utter hypocrisy and opportunistic impetus of her position.

Seneca the Younger said...

As I usually do during the day when I'm working at home, I'm listening to CNBC. I think the kindest word I've heard so far about this is "travesty".

loner said...

No politician with a future in politics was hurt by this. Bill Frist might think he has a future in politics, but it's been some time since that was the case.

The American people, for better or worse, were the cause of this outcome. It was a Network moment in a fragmented and polarized media environment and the best that can be said for the political and business classes is that they were caught flatfooted...again.

Rick Ballard said...

"The American people, for better or worse, were the cause of this outcome."

You're right - doesn't take all that much to move the ignorant mass when there is a bit of resentment already built up. The Iranians might want to name that "Factor X" and mullah it over for a bit.

It wouldn't be a bad thing if the Koslings mulled it over either, as well as a few other strident "advocacy" groups. Backlash is rather unpredictable - might be why the President sticks with the RoP rhetoric.

MeaninglessHotAir said...


I wonder if Clinton will not regret her role in this. I doubt it gained her as much as it cost her:Raising the awareness of the utter hypocrisy and opportunistic impetus of her position.

Certainly she's the one who instigated all this, but does her action really carry any information content? Did we really find out anything we didn't already know?

What about, for example, her widely publicized trip to Billy Graham's last revival meeting? How much "utter hypocrisy" can we stand?

I think that those who can see her with clear eyes have realized how hypocritical and opportunistic she really is, and she has long hence written such people off. She really does believe in the VRWC you know. Her core constituency believes she's flummoxing the stupid conservatives on purpose and that she doesn't believe a word of it. She loses nothing with this crowd either.

The whole stunt was designed to appeal to those who want security but don't read blogs or pay particular attention to what's going on. Such people will read the hysterical headlines about "Arabs Taking Over Our Ports" and "Hillary Takes a Principled Stand" and will be persuaded that she can be trusted on national security. That's all she's aiming for, a small shift among the uninformed. That's all she needs to win. There are a whole lot of partisans out there who were vote for her no matter what; she's triangulating the security issue among the uninformed. People like you who are paying attention are not of interest to her.

Syl said...

Hey, lay off Frist. He wrote something stupendous re freedom of speech for bloggers. Right now, he should be our hero.

On topic: I say give the job to Halliburton!!

So what if they've never done this before. They'll learn. Fast.

And the reaction from the crazies would be priceless. "It was a Cheney plot"

Silliness aside, I'm really so angry over this stupidity.

terrye said...

I realize that people are sick of thinking about anything and everything remotely associated with the ME...but we do not live in this world by ourselves, like it or not we have to deal with people.

As for Hillary, I am not sure she can convince enough people to help her. Besides, you never know what will happen.