The Real Issue On Aborted Dubai Deal

THE AWFUL SPECTACLE of the Republican Party scuttling to the right of the Democrats on national security over the Dubai ports deal obscures the real issue.

That Democrats are clueless, wrong on national security and wrong on economic policy. Again.

When President Bush infuriated the compassionate classes with his warning to the world that “you are with us or you are against us” he was articulating the overarching strategy of the United States.

That strategy is to invite the world to join us in our commonwealth of trust and good faith. We will trust those who are trustworthy, and we will fight those who are not.

The aborted Dubai port deal symbolizes this policy in spades. Dubai Ports World is, as Robert M. Green reminds us, probably the “global best practice” company in container port operations. They are right in the middle of the huge effort to upgrade the security and the efficiency of global trade.

Carved from the Dubai Ports Authority, the company's reputation for technological implementation dates back to its project to automate many of its processes in the 1990s. At that time, Dubai became one of the first ports in the world to implement so-called e-shipping, digitizing most of its planning, scheduling and operations while "building out" a CRM (customer relations management)/Web portal system that was one of the first of its kind used by a port.

According to American e-commerce experts who followed the UAE technology implementation as it has evolved, it was Dubai's willingness to invest in IT that allowed it to offer container shipping and related services at lowered costs for its customers. Last year, a Homeland Security official called the two-terminal Dubai facility "modern and extremely efficient ports."

This sort of story indicates that DB World is clearly showing, by its actions, that it belongs on the side that is “with us” rather than against us.

But you can see where the Democrats are coming from. If DB World represents global best practice in the ports business it is a threat to their union paymasters moving the cargo and driving the cranes and trying to continue as pencil-and-paper clerks in the face of a massive adoption of e-commerce practices. And it is also a threat to the monopolistic stevedoring companies that have comfortably extracted rent from the cosy port management trade for decades.

For ordinary Americans, DB World could be thought of as the Wal-Mart of the ports business. But for the port unions and companies, DB World is the grim reaper.

Well, after a week or so of political firestorm the Democrats have got their way, for the moment. No Wal-Marts in our ports! And no terrorist foreigners!

But we forget, as we obsess about terrorists and golden temples, that underneath all the froth and the confected rage of the well-educated Islamicist terrorists out for their bit of fun—just as European anarchists had their fun in Europe a century ago—a monster is stirring. That monster is what Marx called the productive forces. In the end, the monster will not be denied.

You can rail if you like at the Wal-Marts and the DB Worlds just as the fashionably radical railed against Standard Oil and U.S. Steel a century ago. But when these companies are bringing down the cost of doing business, you are railing against a force of nature.

One way or another, the world has to adapt to the new facts on the ground. When John D. Rockefeller reduced the price of oil by 90 percent and Andrew Carnegie reduced the price of steel by two thirds, the world changed. When Wal-Mart changes the face of retail with its relentless cost-cutting, and DB World galvanizes the freight forwarding business with its early adoption of web-based information management, then you’d better get with the program.

But for the progressive soul of the Democratic Party, that is inconceivable.

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Christopher Chantrill blogs at www.roadtothemiddleclass.com. His Road to the Middle Class is forthcoming.

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