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Wednesday, August 24, 2011

An Open Letter to Secretary Napolitano

By: Dr. Jim Giermanski, Chairman Powers Global Holdings, Inc.
Dear Secretary Napolitano:

First, you must know that I speak for myself, not my firm or any constituency.  Since the attack of 9/11, and the subsequent creation of the Department of Homeland Security (DHS),  I have been thinking about the economic role of the global supply chain as it impacts the United States, and about the role of DHS in addressing the supply chain in light of all the U.S. and international security programs, national laws, global security standards, and the money allocated to DHS for our homeland defense.   My thinking turned to speaking, to writing, and now to questioning directly the degree to which DHS has addressed serious questions of concern.

The following questions are not in any specific order because they difficult to categorize.  However, the last two may be the most serious.

1.  Does DHS believe and support the use of Container Security Devices (CSDs) as being consistent with law, foreign security programs, non-government organizations, and the private sector bottom-line needs?
2. Does DHS believe that container security technology and CSDs serve as revenue producers for the private sector?
3. Why is the official policy on physical security for containers sealed "doors-only?"
4. Other than the incentives claimed by CBP for the private sector's participation in C-TPAT, what U.S. government incentive is used to encourage the use of CSDs?
5. Why is DHS not participating with the EU and other nations who are working together to develop an international standards and protocols for CSDs?
6. What can Congress do, but has not done to encourage CSD usage? 
7. What has DHS done with respect  to informing and encouraging Congress to ratify the Rotterdam Rules recognizing that these new Rules improve supply chain security?
8. Given increased security concerns about Mexico, what CSD pilots or programs have been used or tested in Mexico/U.S. cross-border commercial practices?
9. In which CSD pilots, if any, has DHS participated?
10. Why is DHS not complying with the mandates of the Implementing Recommendations of the 9/11 Commission Act of 2007 with respect to CSD for usage HAZMAT movements?
11. If Trade Facilitation is one goal of CBP, why wouldn't CBP/DHS required the use of CSDs knowing that their usage is a financial benefit to the user as well as to the government?
12. Since DHS admits that transshipments are a legitimate security concern, why hasn't DHS mandated CSD usage for all containers inbound to the United States which transit a transshipment port?
13. Why has the "Green Lane" concept not yet been implemented in seaports to encourage CSD usage?
14. Why continue weak programs such as CSI knowing there is no actual verification of container contents?
15. Why is it that DHS/CBP has not yet addressed the current proven vulnerability of using the required 433.5 to 434.5 MHz spectrum in our ports knowing and admitting in writing along with the Office of the Secretary of Defense that the vulnerability truly exists as indicated in this DHS statement: ... these technologies...can be exploited and potentially used to trigger an explosive device.
16. Has DHS funded or directed an empirical study of the impact of closing all U.S. seaports and land ports-of-entry as a result of one or two dirty bomb blasts in the U.S. ports?

The answers to these questions to me are obvious and referenced by outside sources and experts.  CSD usage is clearly in line with national law, international organizations, and sound business practices.  It is a revenue generator documented in reports of Stanford University, A.T. Kearny, Bearing, and even the Congressional Budget Office.   While CBP touts the benefits of using CSDs, it still does not provide "tier three" privileges like Green Lanes at U.S. seaports, actually required by the Safe Port Act of 2006 if a container security device is used.  Additionally, "doors-only" physical security is simply dumb!  There are many ways which have been empirically demonstrated that can bypass locked container doors.   Patting down children before boarding a plane and not securing a container electronically is simply unbelievable and indicative of DHS leadership.

With respect to working with Congress to encourage CSD usage, I know of no suggestion by DHS to Congress of providing tax credits for CSD usage, yet tax credits for home improvements, cars, appliances, solar energy, mine rescue, distilled spirits, etc., etc., are common.  I also question whether DHS has encouraged Congress to ratify the Rotterdam Rules which provide an additional layer of security compared to The Carriage of Goods by Sea Act under which we now operate. 

With respect to cooperating in international pilot programs utilizing container security technology, specifically those within the European Union's Seventh Framework Programme (FP7) or even with our Mexican partner, DHS was conspicuously absent.  After almost 3 years of work,  the FP7's Smart Container Chain Management Program (SMART-CM) will culminate in its workshop to  deliver: Container Security & Tracking Devices’ technical characteristics and Security Messages’ standardization.   Not only is DHS absent in the international standardization efforts,  it has also paid attention to the Implementing Recommendations of the 9/11 Commission Act of 2007 and its requirements to monitor "end-to-end" the movement of "security-sensitive material" including HAZMAT, to detect "radiation detection equipment,"  "breaches," and to detect and monitor the  internal environment of the conveyance carrying these substances.
With respect to CBP programs like CSI, supply chain security experts and retiring CBP personnel who can now speak freely acknowledge these programs do not genuinely verify container cargo contents.  There is also evidence, in light of official testimony by former CBP leadership, that DHS is unaware of any technology to neutralize the transshipment vulnerability.  However, CSDs were, in fact, available at the time of his testimony to neutralize this vulnerability.

For me, one of the most troubling issues, is that DHS admits in writing to the vulnerability created of the federal requirement to use radio frequency identification (RFID) frequency spectrum 433.5 to 434.5 MHz in U.S. ports.   Its use to trigger an explosive device is confirmed by the Office of the Secretary of Defense.  This was again reported on in August, 2011 by senior investigative reporter and on-line editor of HSToday.US and comments from readers confirm his report.

Imagine the impact of a WMD explosion in one of our ports on our weakened economy, let alone loss of life at the impacted ports?    Vessels carrying imports to the United States could not discharge their cargo.  U.S. exporters could not ship by vessel when vessel cargo accounts for 90% of global shipments.  There would be a serious impact on energy, jobs, pharmaceuticals, food, and more.   It appears to me that given your department's handling of these aforementioned problems and issues, it is only a matter of time for a cataclysmic event of this nature to occur, shutting down all other seaports and land ports-of-entry as 9/11 did to air traffic.

So, Madam Secretary, what is your department doing to address these obvious supply chain  issues?  What is being done to include the U.S. and international private sectors in handling these problems for which private sector solutions already exist?  Why is DHS not involved with developing international standards when the U.S. private sector is represented on the EU Commission's advisory board for the FP7 Programme and involved with CSD international standardization?   I only hope that you are aware of these serious threats and take action  with Congressional support to immediately to address them.  And if you have been aware of these threats, and have done so little to address them realistically, for me, your continued tenure as Secretary should be in jeopardy.   Except perhaps for C-TPAT, a program established before your tenure as Secretary, I believe that your handling of global supply chain vulnerabilities has been reactive at best and perfunctory at worst.

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