Friday, February 24, 2006

about this ports business

Nearly everyone, apparently, is freaking about the deal on the table which will give Dubai Ports International managerial control of six US ports.

They're all idiots.

The overwhelming majority of people in the US know nothing about shipping. If you ask any random person how grain is moved, or how auto parts or textiles get here from, say, China, they'll respond, "Planes?" They know that oil gets moved by tankers, but that's about it. They don't know anything about containerships or dry bulk carriers, or even that there are different sizes of tankers. They don't know that although moving huge quantities of stuff is expensive and you would therefore think it's also lucrative, it's still pretty easy to take a beating in shipping if you make a few bad decisions.

The main thing they don't know is this: the US is out of the shipping business, and has been for decades. We don't build commercial vessels, we don't service them, we don't scrap them. We have virtually no international commercial fleet. That means nearly every tanker, every dry bulk ship, every containership that comes into a US port is owned and operated, and serviced and loaded, by foreign companies.

I know a little bit about shipping, since I worked for a teeny-tiny company many years ago that wrote decision support software for shipping industry executives. I was mostly a techno-geek but I was also tech support and believe me, walking an executive from a multi-billion dollar shipping company through a botched installation is no picnic. (Although onsite visits were always fun, since they involved going to places like London, and Oslo.)

The point here is: US concerns decided a long time ago that there was no money for them in shipping -- or not enough, anyway, and so they got out. We've been out for a long time. So, to all these folks who are running around saying we shouldn't be letting a foreign country run our ports: foreign countries don't just run our ports, they run every freakin' port in the world.

Also, since its the Brits who are turning over the ports to DPI, what do they think about it? The British have been staunch allies in the war on terror, but the P&O folks seem to feel just dandy about selling out to DPI. Wouldn't you think the British would be concerned about this takeover, if it posed much of a security threat?

I will not defend the Administration's failure to get in front of this story and force a flow of information that could shut up all the hysterics out there. Once again the White House has proved itself to be oddly incompetent politically, whereas in the past it has had some bright & shiny political achievements. But I will defend this deal -- especially since it's not up to us to tell P&O not to sell themselves to DPI, how could we? Neither one is an American company, the US has no regulatory power here. If we don't want DPI overseeing the management of those ports, we better scramble and get some other company to do it.

But I can predict with 100% certainty that whatever company we get will not be American.

As for port security: it may actually improve under DPI. I doubt it could get any worse. Now I'm going back to my knitting.

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