Transcript: Fran Townsend on 'FNS'

The following is a partial transcript of the Feb. 26, 2006, edition of "FOX News Sunday With Chris Wallace":

CHRIS WALLACE, HOST: Well, the big story this week has been that company from Dubai taking over operations at six U.S. ports, and the storm of criticism from Democrats and some Republicans. Here to discuss the sale and what happens next is White House homeland security adviser Fran Townsend.

Thanks for coming in, and we're delighted to have you here.

PRESIDENTIAL HOMELAND SECURITY ADVISER FRANCES FRAGOS TOWNSEND: Thank you, Chris.

WALLACE: So is there a deal for Dubai Ports World to resubmit its takeover of port operations to the Bush administration for a full 45-day security review?

TOWNSEND: Chris, as we've said, we've had ongoing conversations both with the Congress and with the company. We've had them publicly. We've had them privately.

And we believe that anything that permits there to be additional time so that more people can learn the facts as we learned them is to the better, because once people understand that security is never going to be outsourced, it will continue to be handled by the men and women of the Coast Guard and customs and border patrol, and that this is really a commercial deal where the security concerns have been addressed, that's a good thing, and people will be more comfortable with it.

WALLACE: But you say you want people to learn what you've learned. If you're doing a 45-day review, it sounds like that's more for public education than it is for you to study — you, the administration, to study — these issues yourselves.

TOWNSEND: Well, the answer is we haven't received a request yet from the company. There are ongoing discussions. We'll have to see what that letter or what that request would include.

But the answer is as we go up to Congress, as we talk to people about the facts of the deal, we believe more people will be comfortable with it as they learn the facts.

WALLACE: But here's, I guess, the point. Just two days ago, the president's national security adviser, Stephen Hadley, said that there's nothing to reopen. He said that the review was complete. What's changed?

TOWNSEND: Well, that's right. Steve was absolutely correct when he said that. We have no mechanism — we, the government, have no mechanism, having completed our review, to reopen it.

The only thing that could cause it to be reopened would be a request from the company itself. We can't generate that. That's really up to the company.

WALLACE: But I guess the point I'm getting at is, is there anything to review? Has the administration fully satisfied itself? Because we were hearing just yesterday every national security agency looked at this, everything was fine.

Is there anything for you — if they ask for a 45-day review, is there really anything to review, or is this simply a political maneuver to try to build public support?

TOWNSEND: Well, the answer is all of the agencies who are involved in the Committee for Foreign Investment in the United States did look at it. Not a single one of them raised an objection. And I will tell you that it was more than just the 30-day review from December 16th. After all, this is reported going back to late October.

And there were a number of discussions among agencies and briefings between the company and the interested parties and the government long before the December 16th formal filing. We're satisfied that there's been a complete review of the deal. We're satisfied that we've addressed the security concerns.

But for us to go back and reopen it, it would have to be based on a request from the company. We don't have by the congressionally mandated process any ability to reopen it.

WALLACE: What would you do? I mean, in other words, if you've already reviewed it and you're satisfied, what would you do if there was a 45-day review?

TOWNSEND: Well, the answer is we've addressed the security concerns in a side agreement which you're aware of between the Department of Homeland Security and Dubai Ports World.

The question will be — and I can't guess, because we haven't received a letter from the company asking us to reopen it, so you're asking me to sort of guess about something that I haven't even read yet. We have to see if that request comes.

There is no deal yet. There are ongoing discussions with the company, and I think we have to wait and see what a letter request would look like if it comes.

WALLACE: OK. Let me ask you about some of the concerns that critics of this deal have raised. Would Dubai Ports World get visas to bring some of its managers to the United States?

TOWNSEND: Well, the answer is they would get any — they'd have to go through the normal visa process you would for a work visa.

One of the interesting things was because the Department of Homeland Security wanted to have provisions to address this in particular, they have a provision in their security agreement that talks about law enforcement, requiring law enforcement cooperation.

That permits them, then, to do special background checks of individuals coming to this country that would — in relation to the deal and the execution of the deal. So this was anticipated, this concern, and addressed in the security agreement.

WALLACE: Company executives say — they said, in fact, here on Friday on "Special Report" — that they would be privy — as part of their job in operations in these ports, they would be privy to security arrangements so they could comply with them. You don't see any dangers there?

TOWNSEND: Well, this is true — you know, it's — we need to step back for a second. One of the points the president has made very clearly is you're not going to treat this company differently than we treat any of our other allies in the war on terror.

International cooperation — this is a fundamental exercise in international cooperation, just as air security is. We have to work with our partners. We have to set clear requirements in terms of security. And then we have to hold them to those standards. But we treat all of our partners the same.

WALLACE: Let me ask you a direct question. Do you think there's some anti-Arab bigotry in all of this?

TOWNSEND: Well, I think we have to be honest that it's awfully concerning and to the extent that we're treating one company different than we would treat the British company, I think we have to be very honest and ask ourselves why is that.

That would be in my mind unacceptable and, frankly, offensive.

WALLACE: Do you believe that there is anti-Arab bigotry?

TOWNSEND: Well, bigotry is your word. I think we've got to be honest with ourselves that allies in the war on terror all need to be treated equally no matter where they come from. You notice that after the London bombings that we didn't put special restrictions on the British company. Why would we treat this company differently?

WALLACE: I want to talk to you about the process, because in addition to the substance of this deal, a lot of critics have been upset about the process, the way this was handled by the White House. Question, when did you first learn that the administration had approved this deal?

TOWNSEND: It was mid-February, right around the same time the president learned of it. But I will tell you that because the Department of Homeland Security...

WALLACE: Even though it was approved on, I believe — January 23rd, was it?

TOWNSEND: That's right. I don't...

WALLACE: You learned about it in mid-February.

TOWNSEND: That's right. I don't sit on the Committee for Foreign Investment in the United States. But many of my colleagues at the White House do. The secretary of homeland security does.

And when I looked at the deal, I was satisfied that the homeland security and counterterrorism concerns had all been addressed.

WALLACE: But, I mean, here is the question. The White House says — I mean, as you say, you learned about it the same time the president did. He supposedly learned about it last weekend from the media.

How is it possible, with 12 administration agencies reviewing this for months, as you say, that no one thought to tell the White House look, there's something here and it may have some political consequences to it?

TOWNSEND: Two issues. First, the president found out on February 16th from Andy Card, the president's chief of staff. Second...

WALLACE: That's not what Scott McClellan said. He said he learned about it from the media.

TOWNSEND: Well, I can tell you, having spoken with Andy Card, that he informed the president on February 16th. That's first.

Second, these deals go through and are reviewed all the time. There have been 65 last year. Rarely do they make it to the president. Rarely do they make it to the...

WALLACE: But this was a different deal, as we've seen this week.

TOWNSEND: Well, that's right. But you know what? I take actually comfort in the fact that it was reviewed by experts across the government, in the agencies that have a concern, and those concerns were addressed.

So it didn't need to rise up to that level. This was dealt with at an expert's level to keep the politics of it out of it, in fact.

WALLACE: Ms. Townsend, we're going to have to leave it there. We want to thank you so much for coming in and answering our questions and I think a lot of Americans' questions.

TOWNSEND: Chris, thank you.