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The recent uproar over the Dubai ports deal is another example of a trend of protectionist though sweeping through the United States. Is the fear justified, or is it simply a case of nervous xenophobia? To answer this question, we must examine what the United Arab Emirates (UAE) is all about. The United Arab Emirates is located south of the Persian Gulf, surrounded by Oman and Saudi Arabia. The two largest emirates, Abu Dhabi and Dubai are well known for their tremendous oil wealth and the recent completion of the world's first seven star hotel. A sleepy port town just a century ago, Dubai now ranks as one of the most dynamic economies in the world. Largely this is credited to the discovery of oil in the 1960's, despite the fact that its oil reserves make up barely a fraction of Dubai's GDP. Its economic success has been far more dependant on its relaxed immigration laws and lack of income taxes. Since the early part of last century, merchants, traders, and entrepreneurs of all kinds have been flocking to the country to take advantage of a free-market system that puts the United States to shame. Today, over 80% of the population is a foreign national, immigrating into the country because of their desire to work. In many ways, Dubai today is similar to America over a century ago, during its phase of greatest growth. At that time, it was illegal and unconstitutional for the American government to levy income taxes and most citizens of the US still identified themselves as immigrants from Ireland, France, England, or Holland. Many came here escaping religious persecution, and much of the country was built on the foundation of religious tolerance. Today, in Dubai, a mass migration of people from surrounding countries are coming in seeking escape from their hardline Muslim governments. Certainly the Dubai government identifies itself as a Muslim nation, but all religions are openly practiced. The sale of alcohol and pork, two of the largest sins in the Muslim faith, are sold openly and legally by vendors small and large. Religion, it appears is a personal choice, ,not a state institution, and many non-Muslims are citizens of the UAE. While many Americans fear a port being operated by a company based in a Muslim nation, it appears this fear is unfounded. Not only is Dubai a model for free market capitalism, its religious tolerance in an area dominated by militant Islamic rulers makes it a very powerful ally of the US, in a place where America desperately needs allies. Even so, security at this port would continue to be performed by US personnel, essentially minimizing any operational changes in its day to day business. The UAE company would simply be making a financial transaction, and in return obtain a dividend yield (in the form of rent) for its investment. Very few employees from the new company would even have to step onto port. Americans must keep in mind that the business was placed up for auction, and not one single American company even placed a bid. The UAE is not only an outstanding strategic ally for America, it also has some of the brightest entrepreneurs in the world. Let's hope xenophobia doesn't stop this deal from going through.
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