The Institute hosted a luncheon meeting May 18, 2006 to release its new study US National Security and Foreign Direct Investment. The book provides the first comprehensive analysis of the security and political, as well as economic, dimensions of foreign direct investment in the United States. Its publication comes in the midst of the debate over how the Congress and Administration should respond to the controversial issue of Dubai Ports World’s planned acquisition of container operations at six US ports. The book is written by Edward M. (“Monty”) Graham, a senior fellow at the Institute, and David Marchick, formerly a participant in the CFIUS process as a Deputy Assistant Secretary of State for Economic Affairs and now a partner in the law firm Covington and Burling.
The book examines the trend towards politicization of the Exon-Florio process in the wake of the Dubai Ports World and earlier CNOOC/Unocal controversies. In particular, it asks whether proposed legislation to “reform” this process might lead to further and undesirable politicization, which the authors believe could deter needed foreign investment in the United States, and offers its own recommendations as to how the Exon-Florio process might be reformed. In addition, the book updates and improves economic analysis presented initially in the Institute’s earlier book Foreign Direct Investment in the United States, by Edward M. Graham and Paul R. Krugman, which showed that this investment brings large net benefit to the US economy.