White House May Put Off Ports Deal

Bush administration officials opened the door Thursday to a delay in allowing a state-owned United Arab Emirates company to assume significant operations at six U.S. ports as lawmakers pushed for a new 45-day investigation of the deal.

The company, Dubai Ports World, signaled to Congress that it, too, would be willing to accept a short delay while lawmakers review the deal.

"People don't need to worry about security," President Bush said shortly before administration officials who approved the transaction told a Senate committee their 90-day review did not turn up a single national security concern to justify blocking it.

Karl Rove, the president's chief political adviser, said Bush was willing to accept a slight delay in Dubai Ports World's purchase of terminal leases and other operations at six U.S. ports from a British company.

"There's no requirement that it close, you know, immediately after" a British government review of the $6.8 billion purchase is completed next week, Rove said on Fox Radio's "Tony Snow Show." "What is important is that members of Congress have the time to get fully briefed on this."

Lobbyists for Dubai Ports World indicated that while the company is eager to close the deal, it is willing to agree to a delay to satisfy demands by members of Congress, according to a person familiar with the conversations.

Nonetheless, Senate Democratic leader Harry Reid of Nevada sought quick action on legislation relating to the deal when Congress returns to Washington next week.

In a letter to Majority Leader Bill Frist, R-Tenn., Reid said the administration's handling of the deal "could not be more flawed." Reid said he was alarmed at the failure of the administration to "exercise the full statutory authority to conduct a complete investigation into the potential national security implications of this deal."

The deal allowing Dubai Ports World to take over significant operations at ports from New York to Miami has created an embarrassing standoff between the president and a Congress controlled by his own party.

Raising concerns about national security in an era of terrorism, Republicans and Democrats alike are crafting legislation blocking or delaying the deal with an Arab country tied to some of the Sept. 11, 2001 hijackers. But CBS News chief White House correspondent Jim Axelrod reports White House officials emphasize Mr. Bush won't back down from his threat of a veto if Congress passes legislation to try and stop the deal.

Officials from the Homeland Security, Treasury, Defense and State departments appeared before Chairman John Warner, R-Va., and four Democratic members of the Senate Armed Services Committee for a briefing arranged while Congress was officially away from Washington.

The officials tried to assure the panel that the deal has been subject to a careful, three-month review and that all security questions were satisfied. They said no one raised an issue that would have prompted the need for a further, 45-day investigation.

CBS News correspondent Sharyl Attkisson reports there was no sense of backing down on the port agreement by Bush agency officials, but there was acknowledgement if could have been handled better.

"We're not aware of a single national security concern raised recently that was not part of" the three-month review, Deputy Treasury Secretary Robert Kimmitt told the lawmakers.

Democratic committee members accused officials of failing to take into account issues raised about the Arab country in the 9/11 commission's report.

Sen. Carl Levin of Michigan, the top Democrat on the committee, derided the administration's "casual approach" in approving a deal involving a country "with an uneven record of battling terrorism."

Levin at one point noted that a special commission that investigated the terror attacks against the United States on Sept. 11, 2001, concluded that "there's a persistent counterterrorism problem represented by the United Arab Emirates."

"Just raise your hand if anybody (at the witness table) talked to the 9-11 commission," commanded Levin. There was no response among the handful of administration representatives.

White House Homeland Security adviser Frances Fragos Townsend said the UAE's cooperation in the war on terror has changed since the terrorist attacks of 2001.

"They have been critical allies in Afghanistan," she told reporters at a news conference on a separate matter. "They have been critical allies in fighting the financial war against terror. They've been critical allies in terms of our military-to-military relationship."

Levin and Sen. Hillary Rodham Clinton, D-N.Y., accused the administration of ignoring a law that requires a longer review — another 45 days — by the interagency panel if a proposed business deal could affect national security.

Kimmitt responded: "We didn't ignore the law. Concerns were raised. They were resolved."

Warner said he would ask Attorney General Alberto Gonzales to prepare a memorandum on the administration's interpretation of the law to see if it deviates from Congress' intent.

While Warner emphasized the UAE's cooperation in the war on terrorism, he questioned Kimmitt sharply on whether the reviewing agencies weighed the Arab country's role in the transfer of money to al Qaeda and of nuclear components to suspect nations.

Kimmitt said those factors were taken into account.

Mr. Bush told reporters after a morning Cabinet meeting at the White House: "This wouldn't be going forward if we weren't certain that our ports would be secure. The more people learn about the transaction that has been scrutinized and approved by my government, the more they'll be comforted that our ports will be secure."

Secretary of State Condoleezza Rice was in the United Arab Emirates, where she discussed the deal with that country's officials. Earlier, in Lebanon, she said the agreement was thoroughly vetted.

"This is supposed to be a process that raises security concerns, if they are there, but does not presume that a country in the Middle East should not be capable of doing a deal like this," she said.

Republicans added to the chorus of lawmakers speaking out in their home states.

In Allentown, Pa., Sen. Rick Santorum, R-Pa., said he supports legislation to delay approval of the ports deal until Congress is able to "get a better sense as to what the security challenges are out there."

Meanwhile, the state of New Jersey filed a lawsuit in federal court to block the UAE company from taking over operations at the Port Newark container terminal until the federal government investigates possible security risks.

CBS News correspondent David Hawkins reports Dubai Ports corporate officials say they want to stay above the political fray, but will do whatever it takes to satisfy American security concerns and make sure the deal goes through.