[Congressional Record Volume 152, Number 23 (Tuesday, February 28, 2006)]
[Senate]
[Pages S1541-S1543]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. MENENDEZ (for himself, Mrs. Clinton, Mr. Lautenberg, Mr. 
        Nelson of Florida, and Mrs. Boxer):
  S. 2334. A bill to ensure the security of United States ports, and 
for other purposes; to the Committee on Banking, Housing, and Urban 
Affairs.
  Mr. MENENDEZ. Mr. President, I am proud that I have introduced today 
along with Senators Clinton, Lautenberg, Nelson, and Boxer legislation 
that would guarantee that foreign governments cannot control the 
operations of the ports of the United States. I thank Senator Clinton 
for her leadership on this issue as we fight together, along with 
Senator Schumer and others, to keep the Port of New York/New Jersey 
safe.
  I think we all know why public attention has been focused on this 
deal over the past 2 weeks. Our ports are the gateway to this country. 
They are the gateway for much that we eat, that we drink, that we wear, 
drive, and use on a daily basis. But just as they bring in goods we 
enjoy, the ports are also our Achilles' heel, the vulnerability that 
could be exploited in an attempt to bring us down if terrorists 
transport a nuclear, biological, or chemical weapon to our ports. That 
is why our legislation sets a new standard for the future control of 
our ports.
  Our legislation would protect our national security by keeping our 
ports from falling into the hands of foreign governments. Our 
legislation bans foreign government-owned companies from operating in 
our ports and requires the President to report to Congress on how to 
manage national security risks arising from any existing port 
contracts. Our legislation would also end the secrecy associated with 
the Dubai deal by making the executive branch notify Congress as well 
as State and local officials of future deals. The legislation also 
includes a new public comment period.
  Never again should the American public find out about a secret deal 
through the newspapers after the fact. Never again should Congress 
learn about the sale of a key U.S. infrastructure asset to a foreign 
state-owned company only after the deal is done. And never again can we 
compromise national security by turning our port operations over to 
another country, whether friend or foe.
  Our message with this legislation today is clear: Never again.
  I think all Americans instinctively know we cannot simply turn over 
our critical national security infrastructure such as terminal 
operations at our ports to a foreign government. Foreign governments 
act very differently than even foreign companies. Foreign governments 
act in their own national interests and in their own national security 
interests. Privately held foreign companies are controlled by 
stockholders and answer to the needs of the market, not the needs of a 
government. One must only study the way in which Venezuelan President 
Hugo Chavez has used his state-owned oil company to pursue the 
interests of the Government of Venezuela to understand that state-owned 
companies often behave very differently than publicly traded ones.
  That is why our legislation bans foreign governments from owning, 
leasing, or operating any facilities in our ports. We believe that just 
as we would not turn over the operations of our airport facilities to a 
foreign government, why should we turn the operations of our ports, 
which are the biggest hole in our national security blanket, over to a 
foreign government.
  The opponents of this thought process, of this bill, like to argue 
this is the reality of global trade. But the people making this 
argument are the same ones who constantly remind us that the world has 
changed since September 11 and that we must adapt our security response 
accordingly. Whatever happened before September 11, the world has 
changed since then and we cannot rely on our old methods of looking at 
the world in a traditional way.
  One of the things the September 11 Commission told us was to think 
outside of the box. A simple envelope became a weapon of great injury 
when it was filled with anthrax; an airplane used to travel 
commercially or for pleasure was turned into a weapon of mass 
destruction. Think outside the box. And if we cannot think outside the 
box in the context of understanding how the ports in the United States, 
in the hands of a foreign government in an operational capacity, can 
have a security consequence, we are in trouble in this post-September 
11 world. This is an area in which security must take priority over 
commercial transactions.
  Make no mistake about it; the legislation is urgently needed, and I 
am writing the President today expressing my concern that this new 45-
day review leaves the President with no authority to act to stop Dubai 
Ports World from taking control of United States port operations. I am 
not sure that is clear with this 45-day review. This transaction was 
set to close on March 2, and

[[Page S1542]]

we want to stop the clock now and make sure that 45-day investigative 
review period is precedent to the fulfillment of that agreement.
  We also believe it is time to end the secrecy surrounding these 
deals. This secrecy apparently allowed the executive branch to ignore 
our own laws. These laws require a 45-day investigation of deals 
involving government-owned companies which could affect national 
security. Clearly a deal to turn over part of our port operations to a 
foreign government-owned company would impact national security. We 
know the Coast Guard warned the administration that there were 
intelligence gaps that made it impossible to determine the threats 
raised by the deal. Yet it is only now, after enormous external 
pressure, that this 45-day review period may be carried out. But 
starting an investigation that should have already been carried out 
under the law is not enough, and that is why, from my position on the 
Banking Committee, during hearings later this week, I plan to seek to 
discover why the law wasn't followed. I am looking forward to working 
with both the chairman and ranking member to come up with comprehensive 
solutions to these problems that emanated under the Committee on 
Foreign Investment in the United States.
  As I said before, I am also concerned about the secrecy in this 
process. Many New Jersey residents have written or called me asking why 
the process in approving the deal was so secretive and why Congress was 
kept in the dark. It is clear to me, to the people of New Jersey, using 
their common sense, and to the American public that we must have 
transparency and openness as we address these national security issues.
  Without our legislation, the committee that reviews this process 
doesn't even have to tell Congress about the deal until after it has 
made a decision. And even after they make a decision, they have no 
obligation to inform the American public. In the particular case of the 
Dubai Ports deal, the committee sent out no information and the press 
only learned about it when Dubai Ports World decided to put out its own 
press release. That is why our legislation would require the 
notification of Congress, State, and local authorities where 
appropriate, as well as a public comment period to allow the public 
impacted by any future deals to share their concerns with the Federal 
Government.
  These are basic reforms which I think most Americans would agree seem 
necessary, almost obvious when it comes to protecting our ports. The 
fight to secure our ports cannot and will not end with this 
legislation.
  Let me be clear: Our ports are not secure. I have been arguing on 
this for quite a long time as a former Member of the House of 
Representatives representing the Port of Elizabeth and Newark, the 
third largest port, the Port of New York/New Jersey and other ports on 
the eastern seaboard. For all the money the Nation has poured into 
improving our security, several critical links in the chain have been 
ignored, and this week the spotlight has shone brightly on one aspect 
of the problem: our ports, the port of entry for thousands of 
containers every day, holding everything from clothing to electronics. 
But these containers could also contain much more dangerous cargo such 
as a nuclear, chemical, or biological weapon.
  The bottom line is we don't know what is in the vast majority of 
containers entering this country because despite repeated warnings from 
security experts from both within and without our Government, only 1 
out of every 20 containers that passes through our ports is screened, 
and 95 percent receive no screening whatsoever other than a cursory 
glance at a cargo manifest.
  It is crucial that we also develop a national transportation plan 
that includes a comprehensive strategy for protecting our ports. A 
weapon of mass destruction detonated in a shipping container at the 
Port of New York/New Jersey or any other seaport could cause tens of 
thousands of casualties and economic losses approaching a trillion 
dollars. According to the U.S. Coast Guard, $5.4 billion will be needed 
over the next 10 years for port security. Yet since the 9/11 attacks, 
Congress has provided less than $800 million.
  This is not a new problem, and it should not be surprising that the 
administration has let this problem fester. They have continuously 
focused on the security of only one aspect of our critical 
infrastructure to the detriment of the rest. That is something we can 
no longer continue to accept.
  In New Jersey we face the reality of failures in our national 
security every day when we look across the river at Ground Zero and 
mourn the loss of over 700 fellow New Jerseyans who died on September 
11, 2001. The problem of port security is not in some distant future or 
some distant issue but an everyday reality, as we look at our own port 
which brings in hundreds of thousands of containers from around the 
world every day: 145 million tons last year from over 5,000 ships. This 
is a port that generates over 200,000 jobs and $25 billion of economic 
activity. It is a great economic engine. It is also a great risk.
  In today's reality, a foreign government, if it were to be operating 
the facilities at one of those ports and simply wanted to do something 
as benign maybe as shutting it down at a critical moment, such as when 
we are sending supplies to our troops in the field--we use our 
commercial ports increasingly to send military equipment and supplies 
to back our troops in the field--imagine if it were shut down at a 
critical moment when we needed those supplies to be generated across 
the sea.
  That is why we have to face these realities together. We must stand 
together across party lines and across States to fight for the safety 
and security of our families. Our ports are on the front lines in our 
fight against terrorism, and with this legislation, we say we will 
never again allow a deal which would compromise the national security 
of our ports, the safety of New Jersey, or the security of the United 
States.
  I urge my fellow Senators on both sides of the aisle to join with us 
in this legislation.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2334

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Port Security Act of 2006''.

     SEC. 2. PROHIBITION ON LEASES OF REAL PROPERTY AND FACILITIES 
                   AT UNITED STATES PORTS BY FOREIGN GOVERNMENT-
                   OWNED ENTITIES.

       (a) In General.--Section 271(d) of the Defense Production 
     Act of 1950 (50 U.S.C. App. 2170(d)) is amended--
       (1) by striking ``Subject to subsection (d)'' and inserting 
     the following:
       ``(1) In general.--Subject to subsection (e)''; and
       (2) by adding at the end the following new paragraph:
       ``(2) Prohibition on leases of real property and facilities 
     at united states ports by foreign government-owned 
     entities.--The President shall prohibit any merger, 
     acquisition, or takeover described in subsection (a)(1) that 
     will result in any entity that is owned or controlled by a 
     foreign government leasing, operating, managing, or owning 
     real property or facilities at a United States port.''.
       (b) Report Required.--
       (1) In general.--Not later than 30 days after the date of 
     the enactment of this Act, the President shall submit to 
     Congress a report on the leasing, operating, managing, or 
     owning real property or facilities at United States ports by 
     entities that are owned or controlled by foreign governments.
       (2) Content.--The report required under paragraph (1) shall 
     include--
       (A) a list of all entities that are owned or controlled by 
     foreign governments that are leasing, operating, managing, or 
     owning real property or facilities at United States ports;
       (B) an assessment of the national security threat posed by 
     such activities; and
       (C) recommendations for any legislation in response to such 
     threat.

     SEC. 3. INCREASED TRANSPARENCY OF MANDATORY INVESTIGATIONS.

       Section 271(b) of the Defense Production Act of 1950 (50 
     U.S.C. App. 2170(b)) is amended--
       (1) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively;
       (2) by striking ``The President'' and inserting the 
     following:
       ``(1) In general.--The President'';
       (3) by adding at the end the following new paragraphs:
       ``(2) Notification to congress.--Not later than one day 
     after commencing an investigation under paragraph (1), the 
     President shall provide notice of the investigation and 
     relevant information regarding the proposed

[[Page S1543]]

     merger, acquisition, or takeover, including relevant 
     ownership records to--
       ``(A) the Majority Leader and Minority Leader of the 
     Senate;
       ``(B) the Speaker and Minority Leader of the House of 
     Representatives;
       ``(C) the Chairmen and Ranking Members of the Committee on 
     Finance, the Committee on Homeland Security and Government 
     Affairs, the Committee on Banking, Housing, and Urban 
     Affairs, the Committee on Armed Services, and the Select 
     Committee on Intelligence of the Senate;
       ``(D) the Chairmen and Ranking Members of the Committee on 
     Ways and Means, the Committee on Homeland Security, the 
     Committee on Financial Services, the Committee on Armed 
     Services, and the Permanent Select Committee on Intelligence 
     of the House of Representatives; and
       ``(E) the Members of Congress representing the States and 
     districts affected by the proposed transaction.
       ``(3) Notification to public officials of investigations of 
     proposed transactions affecting united states ports.--In the 
     case of an investigation under paragraph (1) of a proposed 
     merger, acquisition, or takeover that will result in any 
     entity that is owned or controlled by a foreign government 
     leasing, operating, managing, or owning real property or 
     facilities at a United States port, the President shall, not 
     later than one day after commencing an investigation under 
     paragraph (1), notify the Governors and heads of relevant 
     government agencies of the States in which such ports are 
     located and provide to such Governors and relevant agency 
     heads information regarding the proposed merger, acquisition, 
     or takeover, including relevant ownership records.
       ``(4) Public comments.--
       ``(A) Solicitation of public comments.--Not later than 7 
     days after commencing an investigation under paragraph (1), 
     the President shall publish in the Federal Register a 
     description of the proposed merger, acquisition, or takeover, 
     including a solicitation for public comments on such proposed 
     merger, acquisition, or takeover.
       ``(B) Summary of public comments.--Not later than 10 days 
     prior to the completion of an investigation under paragraph 
     (1), the President shall publish in the Federal Register a 
     summary of the public comments received pursuant to 
     subparagraph (A).''.

     SEC. 4. TECHNICAL CORRECTION.

       Section 271(e) of the Defense Production Act of 1950 (50 
     U.S.C. App. 2170(e)) is amended by striking ``subsection 
     (c)'' and inserting ``subsection (d)''.

     SEC. 5. EFFECTIVE DATE.

       The amendments made by this Act shall apply to any merger, 
     acquisition, or takeover considered on or after October 1, 
     2005 under section 271 of the Defense Production Act of 1950 
     (50 U.S.C. App. 2170).

  Mr. CORNYN. Mr. President, I am glad to hear our new colleague from 
New Jersey talking about our national security, and certainly this is 
one subject which always concerns us. It is the primary role of our 
National Government to provide for the security of the American people. 
I hope that in the debate, though, about the control of our ports, we 
don't operate on the basis of looking for political advantage but, 
rather, we take a calm and deliberate review of the facts.
  I heard this morning, in the Armed Services Committee, from the 
Director of National Intelligence, who said that after a review of this 
transaction, it was his opinion, as the lead Government official for 
the intelligence community in our Nation, that any risk in this 
transaction was low. Certainly, that was useful information to have, 
and I anticipate that we will continue to hear more as the Homeland 
Security and Governmental Affairs Subcommittee continues to look into 
this transaction, and I trust we will do our due diligence during this 
45-day review period.
  But I hope we don't make this a political football. I hope we don't 
paint this with such a broad brush that we consider any Arab nation our 
enemy when, in fact, this Nation has been an ally in the global war on 
terror. I hope we will make our judgments based on behavior and not 
where someone comes from or their ethnicity or other origins because, 
of course, fanning the flames of prejudice based upon those sorts of 
considerations would be inappropriate entirely.
                                 ______