President Bush was unaware of the pending sale of shipping operations at six major U.S. seaports to a state-owned business in the United Arab Emirates until the deal already had been approved by his administration, the White House said Wednesday.
Defending the deal anew, the administration also said that it should have briefed Congress sooner about the transaction, which has triggered a major political backlash among both Republicans and Democrats.
Also defending the deal is U.S. Treasury Secretary John Snow, who on Wednesday said there was no security risk and failure to do so would send the wrong message overseas.
"The implications of failing to approve this would be to tell the world that investments in the United States from certain parts of the world aren't welcome," Snow told reporters Wednesday following a visit to a fuel cell manufacturer. "That sends a terrible message."
The Committee on Foreign Investment in the United States reviewed the transaction and did not object. The committee, run by the Treasury Department, also includes officials from the departments of Defense, Justice, Commerce, State and Homeland Security.
"They vetted it," Snow said. "They concluded this does not present a risk. Our failing, if there was a failing here was in explaining the process."
Mr. Bush on Tuesday brushed aside objections by leaders in the Senate and House that the $6.8 billion sale could raise risks of terrorism at American ports. In a forceful defense of his administration's earlier approval of the deal, he pledged to veto any bill Congress might approve to block the agreement.
Mr. Bush faces a rebellion from leaders of his own party, as well as from Democrats, about the deal that would put Dubai Ports in charge of major shipping operations in New York, New Jersey, Baltimore, New Orleans, Miami and Philadelphia.
While the president has adamantly defended the deal, the White House acknowledged that he did not know about it until recently.
"He became aware of it over the last several days," White House spokesman Scott McClellan said. Asked if Mr. Bush did not know about it until it was a done deal, McClellan said, "That's correct."
"The president made sure to check with all the Cabinet secretaries that are part of this process, or whose agencies or departments are part of this process," the spokesman said. "He made sure to check with them even after this got more attention in the press, to make sure that they were comfortable with the decision that was made."
"And every one of the Cabinet secretaries expressed that they were comfortable with this transaction being approved," he said.
Critics continued to push for legislation to block the deal.
"I will fight harder than ever for this legislation, and if it is vetoed I will fight as hard as I can to override it," said Rep. Peter King, R-N.Y., chairman of the Homeland Security Committee. King and Democratic Sen. Charles Schumer of New York announced they will introduce an emergency bill to suspend the ports deal.
Another Democrat, Sen. Bob Menendez of New Jersey, urged his colleagues to force Mr. Bush to wield his veto, which Mr. Bush — in his sixth year in office — has never done. "We should really test the resolve of the president on this one because what we're really doing is securing the safety of our people."
McClellan dismissed any connection between the deal and David Sanborn of Virginia, a former senior DP World executive whom the White House appointed last month to be the new administrator of the Maritime Administration of the Transportation Department. Sanborn worked as DP World's director of operations for Europe and Latin America.
"My understanding is that he has assured us that he was not involved in the negotiations to purchase this British company," McClellan added.
"In terms of David Sanborn, he was nominated to run the Maritime Administration because of his experience and expertise," the spokesman said. Sanborn is a graduate of the U.S. Merchant Marine Academy. He is an operations professional.
The White House is now on the offensive, sending people out on TV to argue their case, CBS News correspondent Bill Plante reports. Republicans are furious that they weren't consulted beforehand on so sensitive a deal and even more furious that the Democrats, whatever they may genuinely believe, now have a club to beat them with.
"This company is a legitimate company that operates ports around the world," White House counselor Dan Bartlett told CBS News' The Early Show. "They are taking extra precautions and safeguards to meet the requirements that we have as a country. And that's why the president feels so strongly that we go forward because we shouldn't be setting different types of rules for different types of companies just because they may come from the Middle East."
Mr. Bush's veto threat sought to quiet a political storm that has united Republican governors and Senate Majority Leader Bill Frist of Tennessee with liberal Democrats.
To assuage concerns, the administration disclosed some assurances it negotiated with Dubai Ports. It required mandatory participation in U.S. security programs to stop smuggling and detect illegal shipments of nuclear materials; roughly 33 other port companies participate in these voluntarily. The Coast Guard also said it was nearly finished inspecting Dubai Ports' facilities in the United States.
Frist said Tuesday, before the president's comments, that he would introduce legislation to put the sale on hold if the White House did not delay the takeover. He said the deal raised ``serious questions regarding the safety and security of our homeland.
House Speaker Dennis Hastert, R-Ill., asked the president for a moratorium on the sale until it could be studied further.
Lawmakers from both parties have noted that some of the Sept. 11 hijackers used the United Arab Emirates as an operational and financial base. In addition, critics contend the UAE was an important transfer point for shipments of smuggled nuclear components sent to Iran, North Korea and Libya by a Pakistani scientist.