When a British shipping and transport service company, like P&O, manages U.S. ports, nobody cares. But when Dubai World Ports buys P&O and now continues to manage those ports, all hell opens up.
The funny thing is to watch Democrats and Republicans united in fighting the deal against a Bush who, embedded in Middle East corporate interests, threatens to veto any attempt to stop it.
The mask of "terror protecting" comes off and his real face of "corporate money" is there to see for all.
I for one would argue against this deal. But like Soj, not on the grounds of any assumed terror danger.
I do believe that any monopoly-like infrastructure, roads, harbors, water and electricity networks etc., should always be owned and controlled by the state. To have these, even partially, controlled or managed by some private entity is renting out the right to collect taxes. We did away with that a long time ago for very sound reasons.
On the other side, Bush is right here in one serious point.
The U.S. has a trade deficit of some $700-800 billion per year. Americans give money to foreigners to buy their goods. But when those foreigners want to reinvest their earned US$ and get blocked, why would you expect them to continue to take Dollars?
If isolationism is seriously reviving, which I do expect, the US$ is overvalued by some 50%. How would doubling the price of raw materials and consumer products fare with the electorate?
There are three alternatives.
To continue a significant trade imbalances which will lead to the sharecropper society Buffet fears. Here the U.S. people will have to work indefinitely to pay the rent to foreign owners of U.S. productive means. The Dubai World Ports deal is part of this.
Second, isolationism with a high inflationary, Dollar dump period, leading over years to some more sustainable trade (im)balance. This will be payed for by the middle class or whatever is left of it and by foreign US$ holders.
Third, and very unlikely. A high tax environment that curbs U.S. consumption back to grade that nearly equals production within the U.S.
History tells us that the electorate and politicians will choose the short term benefit of alternative two without caring for the longer term consequences. The fight against the port deal is just a part of that game. Foreign investors will note this and act accordingly.