Friday, February 24, 2006

Security issues go beyond ports flap

Security issues go beyond ports flap
By Mimi Hall, Bill Nichols and Sue Kirchhoff, USA TODAY

When mayors, governors and members of Congress learned this week that an Arab company was poised to oversee terminals at six major U.S. seaports, many reacted with surprise and horror.

They demanded to know why President Bush would support the idea of a government-owned company from the United Arab Emirates (UAE) operating key commercial areas in this country where security is paramount. And they vowed to stop the deal.

The $6.8 billion ports deal has become an extraordinary piece of political theater in Washington, but it is quite ordinary in another sense. It merely is the latest example of a decades-long trend in which foreign interests have become heavily involved in U.S. institutions the government now considers targets for terrorism — from busy seaports to utilities and railways.

At the massive Port of Los Angeles alone, 80% of the terminals are run by foreign firms. And the U.S. Department of Transportation says the United Kingdom, Denmark, Hong Kong, Japan, South Korea, Singapore, China and Taiwan have interests in U.S. port terminals.

Bush says a company from the UAE, a U.S. ally in the war on terrorism, shouldn't be treated any differently than other companies that seek to do business here. But the tiny Persian Gulf nation was a base of operations for two 9/11 hijackers — a fact cited repeatedly Wednesday by Democratic and Republican politicians from New York to Miami.

However, port security specialists say much of Wednesday's rhetoric focused on the wrong questions.

Allowing Dubai Ports World to control up to 30% of the port terminals in New York, New Jersey, Baltimore, Philadelphia, New Orleans and Miami shouldn't really be a cause for concern, says James Loy, former deputy secretary for the Department of Homeland Security and a retired commandant of the Coast Guard. "We're making a mountain out of a mole hill here."

He and other analysts say that instead, politicians should focus on gaps in port-security programs that have left the global shipping system and the nation's 360 ports vulnerable to terrorism. The vulnerabilities extend from companies that load cargo containers abroad and the inspection process at overseas ports, to the need to install radiation detectors at most U.S. ports.

If the Dubai Ports World deal is sealed, the company would oversee only a tiny piece of a security chain that is weak from start to finish, Loy says. At the six ports, the company would be responsible only for keeping cargo containers secure from the time they are unloaded from foreign ships to when the containers are taken away on trucks, generally a few hours later.

The more significant vulnerabilities are abroad, where blue jeans, car parts and other goods are loaded at foreign companies before making the journey to U.S. ports.

U.S. Customs and Border Protection agents inspect U.S.-bound goods at 42 of the world's busiest foreign ports. However, the Homeland Security Department acknowledges that by the time a pair of jeans ends up in someone's shopping cart in Ohio, the chance that the container in which they were shipped was inspected by a U.S. agent is less than 10%.

That security gap is part of what fueled this week's firestorm. New Jersey Gov. Jon Corzine, a Democrat, says his state will file suit later this week to stop the deal in which Dubai is taking over the port terminals from a London company. Members of Congress, including Senate Armed Services Chairman John Warner, R-Va., say they are planning hearings.

Loy says he hopes politicians will begin to focus on the significant port-security questions that are "much more deserving of our interest and attention than this little episode."

Key among them: Is the U.S. government doing enough to make sure terrorists abroad don't use cargo containers to sneak weapons of mass destruction past the Coast Guard and Customs officers responsible for security?

Focus on containers

As a terminal operator, Dubai Ports World would be responsible only for terminal maintenance and security in the area where cargo containers are stored before being loaded onto trucks. Before that happens, some containers are inspected by the Coast Guard. Shipping company and port employees who handle cargo are checked against terrorist watch lists.

"I can understand the high level of anxiety the deal has created," says Keith Mason, former chairman of the Georgia Port Authority. "But a more important issue is what's contained in the boxes when they get to the United States."

By J. Pat Carter, AP
An unidentified official guards a shipping container storage area at the Port of Miami.

After 9/11, the U.S. government imposed security requirements and programs at U.S. ports in response to heightened concerns that terrorists could try to smuggle weapons of mass destruction into the USA in cargo containers.

However, the checks are spotty, and once containers arrive in the United States, they seldom are inspected. The government is working to install drive-through radiation detectors at all major ports so that trucks carrying offloaded containers can be checked for radiation on their way to the nation's highways, but that program is just beginning. Now, only 37% of the cargo coming into the U.S. is sent through radiation detectors.

Other government screening programs include:

•The Customs-Trade Partnership Against Terrorism, which offers benefits to companies, ports, terminal operators and others that provide verifiable information about their cargo and operations. The program was designed to allow Homeland Security to focus on high-risk cargo from undisclosed countries the government suspects of having ties to terrorism.

But last year, congressional investigators found that of the 4,357 importers certified under the program, only 564 — or 13% — had been deemed secure by Customs officials.

•A 24-hour advance manifest rule requires most sea carriers to give the U.S. government descriptions of cargo and information on those handling the cargo 24 hours before it is loaded.

•The Container Security Initiative, which is a voluntary program that allows U.S. officials to pre-screen companies and their goods before containers are loaded on ships. Through the program, U.S. agents work at overseas ports using sophisticated computer models to identify potentially risky cargo that should be physically inspected.

Foreign ownership increasing

Besides raising security concerns, the debate over the Dubai deal has cast a spotlight on the increasingly prevalent foreign ownership of U.S. ports.

Stephen Flynn of the Council on Foreign Relations estimates that most port terminals across the nation are run by foreign interests.

In Los Angeles, port spokeswoman Theresa Adams Lopez says, foreign operations include Yusen Terminals Inc., a subsidiary of Japanese shipping giant NYK Line, established in 1885.

The Port of Seattle has five container terminals. Three are run by U.S. companies, one is managed by a South Korean company, and the fifth is managed by a company partly owned by the Singapore government.

The Port Authority of New York and New Jersey owns five primary cargo terminals, three of which are run by foreign firms. The terminal that would be run by the Dubai-based company is operated in conjunction with a Danish firm. The terminal is leased to the two companies and is five years into the 30-year lease, port authority spokesman Steve Coleman says. The other two main cargo terminals in New York and New Jersey are run by the same Danish firm and by a Hong Kong-based company.

Loy says it's all an inevitable part of a global economy. "The notion that we should not have our ports operated by foreign companies is ludicrous, and indicates someone is not understanding how the global marketplace works today," he says.

Meanwhile, U.S. exporters have worried about possible trade retaliation if the UAE deal is blocked. U.S. shipping companies also have concerns.

Bob Waters, vice president of SSA Marine, the largest U.S.-owned marine terminal operator, said his company has not seen any signs of retaliation at its sites abroad. The Seattle-based company has operations in 150 ports worldwide.

"We haven't seen any indication of that yet," Waters says. But "is there a concern? Sure."

Contributing: Richard Benedetto, Jim Drinkard, Jim Hopkins, David Jackson, Matt Kelley, Martha Moore, Andrea Stone and wire reports

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