You know who Clinton's #1 campaign contributor was?
Bernie Schwartz. CEO of Loral Corp.
Quid pro quo? A China chronology
For 18 months, as a campaign-finance scandal has engulfed his second term, President Clinton has insisted that quid pro quos were never a factor in his unprecedented fund-raising efforts, especially a quid pro quo that would damage national security. Herewith a chronology of events that strongly suggests otherwise.
February 1992 Joining 16 other senators, then-Sen. Al Gore, chairman of a Senate subcommittee on science, technology and space, writes a classified letter to Secretary of State James Baker expressing concern that China, to which the Bush administration had granted a waiver permitting the Chinese to launch a U.S. satellite into space, would "gain foreign aerospace technology that would otherwise be unavailable to it."
October 1992 Condemning the Bush administration's China policy, Mr. Gore, the Democratic Party's vice presidential candidate, fumes, "President Bush is really an incurable patsy for those dictators he sets out to coddle." Bill Clinton, the Democrats' nominee for president, offers this view about U.S.-Chinese relations: "I believe our nation has a higher purpose than to coddle dictators and stand aside from the global movement toward democracy."
1993 Subjected to intensifying bipartisan congressional pressure, President Clinton, following the determination by U.S. intelligence and the State Department that China had sold missile technology to Pakistan, bars the U.S. aerospace industry in August from using Chinese rockets to launch satellites that the State Department classified as "munitions." One of the companies most affected was Loral Corp. (now known as Loral Space & Communications).
In the previous six years, according to Federal Election Commission data, Loral chairman and CEO Bernard Schwartz had made less than $100,000 in cumulative political donations, mostly to Senate Democrats. All of his donations from 1987 through 1992 were so-called "hard-money" contributions, regulated and limited by federal law. Mr. Schwartz made his first unregulated "soft-money" contribution to the Democratic National Committee (DNC) in May 1993.
January 1994 After intense lobbying by the U.S. aerospace industry, Mr. Clinton labels three satellites as "civilian," enabling them to circumvent the sanctions he had imposed only five months earlier. To permit the satellites to be launched from Chinese rockets, Mr. Clinton also issues the requisite presidential waivers, a procedure instituted by Mr. Bush after the 1989 Tiananmen massacre.
June 1994 Mr. Schwartz sends the DNC a $100,000 soft-money contribution, eight times the size of his first soft-money donation in 1993.
August-September 1994 Mr. Schwartz goes to China, having received (purchased?) a highly coveted slot on Commerce Secretary and former DNC chairman Ron Brown's trade mission. With Mr. Brown's help, Mr. Schwartz uses his Chinese contacts to obtain satellite-transmission rights for a mobile telephone network in China, a deal worth billions. In a Sept. 20 memo to the president, White House Deputy Chief of Staff Harold Ickes, who was directing the Democratic Party's fund-raising from his West Wing office, suggests a presidential follow-up to Mr. Schwartz's lucrative China trip: "In order to raise an additional $3,000,000 to permit the [DNC] to produce and air generic tv/radio spots as soon as Congress adjourns," Mr. Ickes advises the president to call Mr. Schwartz and invite him and others to a White House breakfast "to impress them with the need to raise $3,000,000 within the next two weeks."
October-December 1994 President Clinton in early October lifts the sanctions he had imposed on China for selling missile technology to Pakistan, a major victory for the aerospace industry. At about the same time, Mr. Ickes informs the president in a memo that Mr. Schwartz "is prepared to do anything he can for the administration." As it turned out, he had some needs of his own. Lifting the sanctions did not satiate the aerospace industry. Mr. Schwartz also wanted to change the chief licensing authority for satellite exports from the State Department, whose primary interests include protecting U.S. national security and promoting nonproliferation, to Ron Brown's Commerce Department, whose primary interest was promoting the sale of U.S. goods. The dispute centered on State's inclusion of satellites on its "munitions list." This made it more difficult to export satellites and subjected them to the periodic sanctions (1991 and 1993) against China that severely restricted the sale of military goods. Meanwhile, in a seemingly unrelated development, Johnny Chung, a recently bankrupted California entrepreneur, joins the titans of soft money, giving the Democrats nearly $100,000 between August and December, 1994.
January-September 1995 Mr. Schwartz signs a letter to the president advocating the shift of satellite-export responsibility from State to Commerce. In April, to address the issue, Secretary of State Warren Christopher establishes an interagency task force, including the Commerce Department, the Defense Department, the CIA and the National Security Agency (NSA). From April through September, while the issue is being examined, Mr. Schwartz accelerates his soft-money donations to the Democratic Party, topping $140,000. Meanwhile, Chung delivers another $175,000 to the DNC.
October 1995 Agreeing with intelligence agencies, the Pentagon and his own advisers, Secretary Christopher decides to keep the satellites on his department's "munitions list." Commerce appeals.
February 6, 1996 Despite reports in January that China continued to export nuclear technology to Pakistan and missiles to Iran, President Clinton signs waivers for four satellite launches by Chinese rockets. On the same day, Wang Jun, who owns a huge stake in a Hong Kong satellite company, meets with Ron Brown. That night, he attends one of the notorious White House coffees. Beyond his interest in satellites, Mr. Wang is a Chinese arms dealer and the son of one of China's most reactionary leaders, the late Wang Zhen, who advocated the massacre at Tiananmen. As it happens, another of Mr. Wang's companies was suspected of brokering cruise missiles to Iran. For 15 months before Mr. Wang's Washington visit, his company was also the subject of a massive probe by the U.S. Customs Service, which identified the firm as a major supplier of 2,000 AK-47 automatic weapons that were to be smuggled and delivered to drug lords and gangs operating in the United States.
February 15, 1996 One of China's rockets crashes, destroying a $200 million Loral satellite.
March 1996 During the same week that China belligerently fires ballistic missiles into Taiwanese waters to bully the island during its democratic elections, Mr. Clinton officially reverses Secretary Christopher's October decision and awards authority over satellite-export licensing to Commerce. Between October 1995 and March 1996, while the President was considering reversing Mr. Christopher, Mr. Schwartz donates more than $150,000 to the Democratic Party. Between April and December 1996 -- that is, after the reversal -- he donates another $300,000, making him the Democrats' largest individual soft-money donor (more than $600,000) during the 1995-96 cycle.
April-May 1996 A commission headed by Loral reviews the rocket crash and determines it was caused by a flaw in the rocket's flight-control system. Without getting the report vetted by the federal government to prevent the unauthorized transfer of technology dealing with missile guidance and control systems, the review commission shares its 200-plus page report with the Chinese. Because the same Chinese company produces both strategic nuclear missiles and space-launch missiles, improvements in the guidance and control systems of China's space-launch rockets are easily transferable to its strategic nuclear-missile program. Moreover, according to a recent CIA report, China has aimed 13 of its 18 nuclear-tipped strategic missiles at the United States.
Summer 1996 Liu Chaoying, a lieutenant colonel in the People's Liberation Army, funnels $300,000 to Chung from Chinese military intelligence. Ms. Liu is also an aerospace executive at firms sanctioned by the United States in 1991 and 1993 for providing missile technology to Pakistan. And she is the daughter of China's then-highest-ranking general, who was responsible for obtaining Western technology to modernize China's armed forces. According to Chung, Ms. Liu told him to contribute the money to the Democratic Party. In July Chung gave the DNC $45,000, which gained him entrance to two Hollywood fund-raisers, including one where his guest, Ms. Liu, was photographed with the president. Chung's firm paid out another $35,000 to the Democrats in September, bringing his three-year total to $366,000.
November 5, 1996 On the day of his reelection, the Clinton administration finally publishes the regulations governing the March decision on satellite export-licensing. The regulations, which were due in April, arrived more than 200 days late, safely after the president's reelection.
1997 The Pentagon issues a classified report in May analyzing the effect of the Loral-led review commission's unauthorized release to China of its report on the crash of the Chinese rocket. "United States national security has been harmed," the Pentagon concluded, by the improvement in China's missile capabilities that the review report made possible. The Pentagon's analysis prompted a criminal investigation by the U.S. Customs Service and the Justice Department.
Also in 1997, the DNC, admitting it could not vouch for the source of Chung's donations, is forced to return the $366,000 he had contributed. No problem. Mr. Schwartz, even as his firm was being investigated by a federal grand jury, shovels another $366,000 into Democratic coffers, in effect underwriting the Chung refund.
February 1998 Despite intense opposition from the Justice Department, which was worried its investigation into Loral would be compromised, Mr. Clinton gives permission to Loral to officially transfer essentially the same missile expertise to China that the company is being criminally investigated for giving to China without authorization in 1996. Mr. Clinton's February waiver calls the deal "in the national interest." Meanwhile, Mr. Schwartz sends the DNC another $55,000 during the first three months of this year.
May 1998 Loral issues a statement declaring, "No political favors or benefits of any kind were requested or extended, directly or indirectly, by any means whatever." On May 17, President Clinton asserts, "All the foreign-policy decisions we made were based on what we believed -- I and the rest of my administration -- were in the best interests of the American people."
Mr. Clinton's statement would seem to ignore the 1995 agreement among the State and Defense Departments, the CIA and the NSA to keep satellite-export-licensing authority within the State Department, a decision Mr. Clinton reversed. It ignores the vigorous opposition of his own Justice Department to the controversial waiver he granted Loral this year. It ignores the Pentagon's 1997 report concluding that U.S. national security was harmed by technology Loral transferred in 1996, a technology transfer that Mr. Clinton, in effect, retroactively approved in 1998, jeopardizing a Justice Department criminal investigation of Loral.
Mr. Schwartz's company has been the primary beneficiary of policies Mr. Clinton adopted. Disturbingly, these were policies contrary to those advocated by his senior foreign-policy, intelligence, defense and legal advisers. At the same time, Mr. Schwartz has emerged as the Democratic Party's largest individual soft-money contributor, having written checks cumulatively exceeding $1 million since Mr. Clinton became president. He clearly got his money's worth. And, for $300,000, it's equally clear that Chinese military intelligence got its money's worth as well. What about taxpaying citizens whose security has been sacrificed? They, it turns out, are the real "incurable patsies."
Copyright © 1998 News World Communications, Inc.
fas.org
US Companies Reported Assisting Chinese Missile Development
Disarmament Diplomacy -- Issue No 25
Two reports in the New York Times in April have alleged the significant involvement in China's ballistic missile programme by two US companies, Loral Space and Communications (based in New York) and the Los Angeles-based Hughes Electronics division of General Motors.
According to the first Times report (4 April), the involvement of both companies was being investigated by a Federal Grand Jury. The core of the allegation is that the companies provided information on rocket guidance-systems, partly in an attempt to improve the reliability and performance of Chinese rockets carrying the companies' space technology. On 16 February 1996, a Chinese rocket carrying a Loral satellite (reportedly worth $200 million) exploded. According to the report, in February 1997 President Clinton gave permission - apparently during the course of a US Government investigation into the 1996 accident, and against the advice of the Justice Department - for another Loral satellite to be launched by the Chinese. The Times added that Loral's Chief Executive, Bernard Schwartz, was the main individual contributor to Democratic Party funds in 1997.
On 13 April, the Times reported that a classified May 1997 Department of Defense (DoD) report into the 1996 accident had concluded that Loral and Hughes had acted improperly in providing China with expertise and information related to the improvement of guidance-systems. According to the Times, the DoD report concluded: "United States national security has been harmed."
Reacting to the reports, State Department spokesperson James Rubin told the press on 15 April that the matter was still being investigated: "One of the issues that is germane is the extent to which anything might or might not have harmed...national security. And so we would not want to say anything publicly that could interfere with the ongoing investigation..."
Also on 15 April, speaking in Tokyo, Loral President and Chief Operating Officer, Gregory Clark, insisted: "We feel [our] people involved in that [February 1996 incident] behaved correctly. They did not divulge any information that was inappropriate. We feel that very strongly..." Clark added: "We're collaborating very openly with government facilities investigating this."
According to reports, in March this year, Loral concluded a contract with China's Great Wall Industry Corporation for five satellite launches between March 1998 and March 2002; all five satellites will be carried on China's Long March 3B rocket.
Reports: Report - cos eyes of China missiles, Associated Press, 4 April; Two companies probed for China missiles, Reuters, 4 April; US firms helped China on missiles, Times says, Reuters, 13 April; Loral space chief denies wrongdoing in China case, Reuters, 15 April.
© 1998 The Acronym Institute.
acronym.org.uk
The Chinese had launch failure after launch failure prior to Schwartz sending Loral engineers to China to teach them how to build a goos missile guidance system. Then suddenly the Long March missile became reliable. And capable of delivering warheads onto US soil.
Onward:
Satellite Controversy Continues in Build-Up to US-China Summit
Disarmament Diplomacy -- Issue No 27
The build-up to the China-US Summit in Beijing (25 June - 3 July) was dominated by growing controversy in Congress and the media over the possibility that lax US satellite export policy and scrutiny may have led to a US company - Loral Space and Communications - providing China with sensitive information concerning ballistic missile technology and guidance systems. Two particular incidents are exciting the controversy: failed launches of Chinese rockets carrying Loral satellites in February 1996 and January 1995. Waters are further muddied by the issue of significant payments to the Democratic Party by Chinese donors and Loral's Chief Executive Bernard Schwartz; and by claims that President Clinton gave the go-ahead for further launches after the February 1996 incident in the knowledge that doubts existed within his own Government concerning the legality of Loral's contacts with China. See Disarmament Diplomacy No 24 & Disarmament Diplomacy No 25, and Documents and Sources in this issue for background and further details.
Both Loral and the President strongly deny any impropriety; on 10 June, Clinton described his decision to allow a further launch in 1998 was "pretty routine". On 18 June, the House of Representatives voted, by 409 to 10, to immediately commence a major investigation into all the allegations. The Senate is also holding hearings on the issue. On 24 June, State Department spokesperson James Rubin insisted that even if information had inadvertently seeped out following the failed launches, it would not be likely to harm national security or boost China's missile development programme:
"There is some chance that a third party could examine recovered devices to gain some knowledge... But we believe that the impact on national security would not be significant. We are not talking about the technology that is used by American military satellites... The encryption-device involved here is decades-old, and even if reverse-engineered, would only tell somebody where we were years ago."
However, Henry Sokolski, Deputy Secretary of Defense in the Bush Administration, told a joint session of the House National Security and International Relations Committees on 17 June: "The House and Senate should insist that no further satellite transfers be allowed until its investigations and deliberations over this matter are complete." On 25 June, Peter Leitner, an official at the Defense Department's Defense Technology Security Administration (DTSA), told the Senate Governmental Affairs Committee:
"Over the past six years the formal process to control exports of dual-use items has failed its stated mission - to safeguard the national security of the United States. ... [T]he presumption of denial has turned into a presumption of approval... [I]n 1992, there began to be a tremendous reluctance to escalate any issues."
During the 1992-8 period, Leitner argued, the Department of Defense "abandoned its traditional role and instructed DoD employees to side with the Commerce Department and isolate the State Department and the Arms Control and Disarmament Agency [ACDA]..."
On 18 June, it was revealed during House hearings that John Holum - ACDA Director, Acting Under-Secretary of State and one of the witnesses before the National Security and International Relations Committees (see Documents and Sources) - had written a confidential memo in 1997 questioning US China policy with regard to the use of satellites as a 'carrot'. Holum wrote:
"Although it is true that the US has, in the past, seen approval of space launches and related exports as an incentive for Beijing to exercise restraint in its missile-related exports, there has been no evidence to date that this policy is having any effect... It is time to reassess this policy... Carrots have gotten us nothing."
Reports: Clinton says China decision routine, Associated Press, 10 June; Suspend China launches, experts testify, United Press International, 17 June; China implements nuclear export controls, Reuters, 17 June; Congress urged to end China satellite launches, Reuters, 17 June; House backs China satellite probe, Associated Press, 18 June; Memo eyed in China satellite probe, Associated Press, 19 June; 1995 China rocket accident probed, Associated Press, 24 June; US plays down technology loss in satellite crash, Reuters, 24 June; US defense official sees poor technology controls, Reuters, 25 June.
© 1998 The Acronym Institute.
acronym.org.uk
Need more? Let me know?
I'd suggest you cut the crap on this one. I was at Loral during the time much of this happened. While I was not directly involved in the China programs, I knew many people who were and have a fair knowledge of what went on.
Bill Clinton should have been shot for treason. |
