A Space Odyssey
It was an explosion nobody heard. And at more than 500 miles above the earth's surface, nobody could. But that January 11 outer-space collision -- a People's Republic of China medium-range, surface-to-air ballistic missile destroying one of its aging weather satellites -- ought to be a reminder of that country's military prowess, and how to some extent it obtained it, especially during the Nineties.
The Chinese government at first denied any intention to flex military muscle. Foreign Ministry spokesman Liu Jianchao assured the press that his country "opposes the weaponization of space and any arms race." Yet several days later, Yao Yunzhu, a Chinese one-star general, speaking in flawless English at a World Economic Forum in Davos, Switzerland, revealed different intentions. "Outer space is going to be weaponized in our lifetime," she said. If there's going to be a space superpower, "It will have company -- China."
Meanwhile, halfway around the world Senator Hillary Clinton announced on January 20 that she would be a candidate for president in 2008. The two events seemed unrelated -- on the surface. In fact, the evidence is persuasive that Mrs. Clinton, during her years as First Lady, knowingly facilitated the transfer of top U.S. military secrets by way of Chinese spies their network of military and financial influence-peddlers. What China got was technology. What she, her husband and their party got in return were campaign contributions and reignited political careers. Reporters ought to remind Hillary Clinton of three names above all others -- Charlie Trie, Johnny Huang and James Riady. Mrs. Clinton makes no mention of them in her post-White House memoir, Living History, nor does Bill Clinton cite them in his own memoir, My Life. There are, as one soon shall see, good reasons for their omissions.
Getting Around Election Law
Federal statutes bar foreign individuals and corporations from contributing or soliciting funds for political campaigns. Moreover, federal employees may not use their office to affect federal elections nor may anyone, federal employee or not, use government property to engage in political fundraising. President Clinton, in signing the Hatch Act Reform Amendments of 1993, acknowledged as much, stating, "The Federal workplace, where the business of our Nation is done, will still be strictly off limits to partisan political activity."
Somehow the mainland Chinese government and its agents operating in this country skirted such inconveniences, and with the apparent tacit cooperation of the Clinton White House. It was a match whose necessity became apparent, at least from the Democrats' standpoint, in the wake of the 1994 election debacle. The Chinese government, already having gained a foothold in the party, wanted military technology. President Clinton, facing a funding shortfall and a possible primary challenge, by all accounts, was willing to cut a deal. He would help out the Chinese if they provided funds for the 1996 election cycle. As this arrangement lay well outside the bounds of standard diplomacy, pulling this off would require a high degree of coordination.
Yah Lin "Charlie" Trie, a naturalized U.S. citizen from Taiwan, ran the Fu Lin restaurant in Little Rock, Ark., one of Bill and Hillary Clinton's favorite hangouts during Mr. Clinton's days as Arkansas governor. The two men remained close friends after that. "When they meet," reported the Los Angeles Times, "the two embrace like lost brothers." But this was no ordinary restaurateur. Trie also owned a Little Rock-based firm, Daihatsu International Trading, which represented about 30 companies in the U.S., China and Hong Kong, and which had satellite offices in Washington and Beijing. He also was a member of the Four Seas Triad, a Taiwanese crime syndicate allied with Chinese military and intelligence. Chinese triads, noted an unpublished 1988 Justice Department report, were involved in "narcotics trafficking, money laundering, contract murders, illegal gambling, loan-sharking, extortion, interstate prostitution rings and alien smuggling."
One of Charlie Trie's close Triad business partners, Ng Lapseng, on six separate occasions from June 1994 to August 1996 passed through customs at San Francisco International Airport declaring suitcases full of cash in the cumulative amount of $333,000. In each case, he was recorded as entering the White House within 48 hours of arrival to meet with Clinton fundraiser Mark Middleton. If the purpose was to make campaign contributions, this was not known for certain, since the White House did not report such contributions to the Federal Election Commission. The source of the money, reported Edward Timperlake and William C. Triplett II, in their 1998 book-length expose, Year of the Rat, was Mr. Lapseng's brothel operating out of the Fortuna Hotel in Macau, southern mainland China, with "hostesses" serving well-heeled clientele in 30 VIP rooms.
Lapseng did more than carry cash. He also wired it -- in amounts totaling between $1.1 million and $1.5 million, mainly from accounts at the (state-owned) Bank of China -- to Charlie Trie. Some $220,000 reportedly made its way to the Democratic National Committee (DNC) and another $460,000 went to Bill Clinton's Legal Defense Trust, established in response to the Paula Jones sexual-harassment lawsuit.
In exchange for services rendered, Trie received an appointment to the Commission on U.S.-Pacific Trade and Investment Policy, an act requiring a special executive order to expand the commission's size. He also enjoyed easy access to the White House, visiting between 23 and 37 times. On February 6, 1996, Trie arranged admission to a White House fundraising "coffee" for Wang Jun, head of China's most powerful arms export company, Poly Technologies. Just four days prior to Wang's visit, the administration granted his company import permits to allow the shipment of more than 100,000 semi-automatic weapons and millions of rounds of ammunition to a Detroit company, China Jiang An, with ties to China's People's Liberation Army. Clinton himself later admitted that Wang's attendance was "clearly inappropriate."
From January 11, 1995 to August 23, 1996, according to administration documents released in January 1997, the White House hosted 103 coffees, most of them lasting at least an hour, with President Clinton in attendance at most of them. They generated $26.4 million in political contributions. Whatever Charlie Trie knew, however, he wasn't talking. By the end of 1997 he'd fled the country, vowing never to cooperate with congressional investigators. On April 4, 1996, at a White House meeting, Mrs. Clinton, when pressed to recall her involvement with Trie, according to a Senate committee report, did not recognize his name. Then, quickly, she changed her mind, recalling him as "the owner of a restaurant in Little Rock." The calculated vagueness was a ruse. The Clintons in fact had maintained close ties to Trie all along, often seating him at the president's table at White House and Democratic National Committee dinners. At a February 15, 1995 DNC dinner held in honor of fundraisers, Trie sat at the First Lady's table. That sounds like a lot more than a casual acquaintance.
That leads to another name Mrs. Clinton would like to temporarily forget -- John Huang. Mr. Huang had donated $100,000 to Bill Clinton's inaugural committee following his 1992 election. That greased the wheels for a July 1994 appointment as the Commerce Department's deputy assistant secretary for international economic policy. Hillary's personal intervention was instrumental to Huang getting the job, argue Timperlake and Triplett; indeed, it was "common knowledge" among Commerce Department officials. Huang's boss, Jeff Garten, would testify later that Huang was "totally unqualified" for the job, and should be "walled off" in particular from China issues.
Huang, like Trie, a Taiwan-born naturalized American citizen, had serious money to throw around -- and reasons for doing so. Previously, he'd been president of Lippo Bank, a Los Angeles-based subsidiary of the Lippo Group, an Indonesian conglomerate with extensive financial, real estate and infrastructure holdings in Indonesia, China, the U.S. and elsewhere. Lippo also happened to be involved in a joint venture with China Resources, a trading and holding company wholly owned by the Chinese government and frequently used as a front for espionage operations.
The founder and CEO of the Lippo Group was Mochtar Riady, an ethnic Chinese billionaire and also a major donor to the Democratic National Committee. He was particularly close to President Clinton. According to CNN News, "President Clinton met twice with Riady at the White House, and belatedly acknowledged receiving a detailed letter from him that pressed Clinton to establish formal relations with Vietnam and to renew Most Favored Nation trading status with China, among other issues." Mrs. Clinton was especially close to Riady. His company owned the firm she selected to operate the White House Travel Office, she'd given the existing office staff the heave-ho.
Huang first met Riady and one of his sons, James, in Little Rock in 1980 at a Harvard-sponsored seminar. When Huang assumed his duties at the Department of Commerce some 14 years later, with a $780,000 severance bonus (not including a luxury Mercedes) from Lippo in hand, his actions suggested an overweening desire to merge government service with political fundraising and serving the interests of his former employer. Phone records show he had made at least 261 calls from his department office to Lippo Group headquarters in Indonesia. Office records show he also received 37 intelligence briefings from the CIA, viewing between 10 and 15 reports at each session. He also visited the White House at least 67 times, meeting with President Clinton on at least 15 of those occasions, and attended over 100 classified meetings.
That doesn't even include communications from the Washington offices of Stephens, Inc., an investment firm instrumental in bankrolling Clinton's 1992 presidential run, located across the street from the Commerce Department. Huang reportedly used the Stephens office as a safe house at least twice a week to make phone calls, retrieve or deliver fax messages, and send packages. A former Stephens secretary testified before the Senate that he often left his office with classified files without bringing all of them back. Additionally, unbeknownst to his supervisors, he made multiple visits and telephone calls to the Chinese embassy. Huang's CIA briefing officer, John Dickerson, stated for the record that Huang had access to "extremely sensitive sources."
Huang wasn't the sort of person meriting any security clearance. Yet thanks to string-pulling by Commerce Secretary Ron Brown, Huang acquired a top-secret clearance nearly a half-year prior to his appointment. His mid-level, as opposed to upper-level rank proved critical. "If Huang had been appointed one step farther up the bureaucratic ladder," observed Timperlake and Triplett, "his Lippo connections would have been open to congressional examination and his confirmation would have been doubtful." Not for nothing did James Riady call Huang "my man in the American government."
Huang left the Commerce Department in December 1995, his security clearance remaining intact for more than a year after, to become the DNC's vice chairman of finance. He proved an effective conduit for campaign contributions, raising more than $3.4 million, much of it from Chinese-connected commercial and arms-trading fronts, including Wang Jun's Poly Technologies. Some of that company's representatives were indicted in San Francisco in May 1996 after a 16-month federal sting operation uncovered an illegal shipment of 2,000 AK-47 rifles (estimated street value: $4 million) for sale to Los Angeles street gangs. U.S. Customs agents had seized the weapons from an Oakland-docked ship owned by COSCO, the naval arm of the Chinese military. The Lippo Group also happened to be co-owner of a bank through which Poly Technologies planned to funnel profits from illegal arms smuggling.
Mr. Wang was and remains chairman of China International Trust and Investment Corp. (CITIC), a state-owned investment company established by the People's Republic of China in 1979, which came to run more than 40 subsidiaries, mainly banks, in China, Hong Kong, the U.S. and elsewhere. CITIC's specialty was bond issues, and it effectively borrowed billions from Wall Street investors to modernize the Chinese military. The firm got help from future Clinton economic adviser and Treasury Secretary Robert Rubin, at the time still managing director of Goldman Sachs. Rubin opened the doors for a $250 million CITIC bond offering, the first of several during the Nineties. There was a lethal downside to this liquidity. Roger W. Robinson, Jr., a Reagan-era National Security Council aide, predicted a decade ago, "The bond market is going to become the principal funding agency for the proliferation of weapons of mass destruction in the twenty-first century. This is a massive global threat to the security of this country." That looming reality apparently wasn't of much concern to Johnny Huang.
That brings us to the aforementioned James Riady. He had donated more than $475,000 to the Democratic National Committee, the Clinton Inaugural Fund and various Democratic candidates. Bank statements, memos and checks show that one of Riady's 1992 donations was directly covered by foreign funds, with the rest coming from a personal bank account likely receiving foreign money. James Riady's close relations with Bill Clinton went back nearly a decade earlier to his Arkansas governor days. In early 1984, Riady's father, Mochtar, along with Arkansas billionaire Jackson Stephens, head of Stephens, Inc., bailed out Little Rock's failing Worthen Bank. The Riady-Stephens team bought $16 million in Worthen stock and installed James Riady, still only in his 20s, as a director. According to the Arkansas Democrat-Gazette, the Riady-Lippo file on the Arkansas Industrial Development Commission alone was more than five inches thick, containing hundreds of letters between James Riady and Clinton.
The Riadys' management of Worthen Bank was less than stellar. The U.S. Office of the Comptroller of the Currency criticized Worthen for making "excessive loans at preferential terms" to companies controlled by Stephens and Mochtar Riady, likely violating federal law in the process. The Riadys soon shed Worthen, with James Riady resigning from the board in 1986. Not long after, the younger Riady bought the Bank of Trade in California, the oldest Chinese ethnic bank in the U.S. Soon, federal regulators issued cease-and-desist orders for "hazardous lending" and violating money-laundering statutes. Riady quickly sold the bank.
Riady also was close to Associate U.S. Attorney General Webster Hubbell, who'd been one of Hillary Clinton's fellow partners at the Rose Law Firm back in Little Rock. Hubbell eventually pleaded guilty to mail fraud and tax evasion after being accused by Kenneth Starr's team of special prosecutors of generating $400,000 in fraudulent billings during 1989-92 at the firm. Hubbell's phone logs included a large number of calls from James Riady. After Hubbell promised to cooperate with Starr, the Lippo Group made payments to him for "consulting" work totaling between $100,000 and $250,000.
Bill Clinton, in political hock, knew how to return favors. During his November 1994 visit to an Asian Pacific Economic Council summit in Jakarta, the president's business entourage, stage-managed by Ron Brown, scored some $40 billion in contracts. And Clinton's nomination of William Perry as deputy secretary of defense, and then secretary (following the death of original Secretary Les Aspin), also made sense. Perry had done very well during the 60s and 70s as head of ESL, Inc., an electronics firm that had performed extensive contract work in defense communications and intelligence systems for Chinese clients. The Riady family's contacts had paid off.
Investigations and Consequences
All of this strongly suggests that the Clintons, Hillary as well as Bill, chose to look away from the possibility that the administration was transferring military secrets to the Chinese in return for campaign cash. Indeed, they may have been active and not simply passive partners. This, and not real or alleged recreational sex, should have been the basis for impeachment hearings.
The Senate Governmental Affairs Committee, at least, wanted to know what was going on. During July-October 1997, the committee, led by Fred Thompson, R-Tenn., held hearings on the Democratic Party-Chinese connection. As one committee investigator asserted at the time, "If you believe in following the money, then all roads lead to China." The final report, issued on March 5, 1998, pointed to a systematic abuse of power by operatives within the Democratic Party and the Clinton administration. But getting the goods on the principal players would be a tough act. The report's Executive Summary noted:
The full scope and import of [John] Huang's activities while at Commerce may never be known: he has invoked the Fifth Amendment and refused to cooperate with the Committee, [James] Riady has left the country, and many of his former LippoBank colleagues have returned to Indonesia. The volume of Huang's contacts with Lippo and the Chinese embassy, however, is cause for concern. The Committee has found no direct evidence that Huang passed classified information, but he had the opportunity to do so and his activities have not otherwise been adequately explained.
A major reason for the lack of smoking guns, the report noted, was that the Congressional resolution authorizing the investigation had set a December 31, 1997 deadline, a clause virtually inviting delay tactics by administration-friendly witnesses. Indeed, when it was all over, more than 45 witnesses either had fled the country or asserted their Fifth Amendment right against self-incrimination.
The Justice Department established a Campaign Financing Task Force following the 1996 election cycle to investigate allegations of campaign finance abuse. Here, as in the Senate, the investigation was designed to hit a roadblock. Attorney General Janet Reno declined to appoint an independent counsel, despite advice to the contrary from task force head Charles La Bella and FBI Director Louis Freeh. Moreover, once the investigation got underway, there was in-house resistance. FBI agent Ivian C. Smith wrote a letter to Freeh, dated August 4, 1997, expressing "a lack of confidence" in the Justice Department's willingness to conduct a thorough investigation. Smith and three other career agents had testified before the Senate that the Justice Department had impeded their inquiry. FBI agent Daniel Wehr stated that lead U.S. Attorney Laura Ingersoll told the agents they should "not pursue any matter related to solicitation of funds for access to the president." Her reason: "That's the way the American political process works." The four agents also said that Ingersoll (who eventually was replaced) prevented them from executing search warrants to stop the destruction of evidence. New York Times columnist William Safire described Attorney General Reno's chief stonewaller, Lee Radek, as a person whose job was "successfully making certain that no investigation of illegal Asian money poured into the Clinton-Gore campaign touches any of the higher-ups."
Eventually, dominoes fell, but at the cost of our ability to reach the top of the Democratic Party food chain. Our trio of starring Chinese players each copped a plea. Charlie Trie in May 1999 pleaded guilty to violating federal campaign finance laws by making political contributions in someone else's name and causing a false statement to be made to the Federal Election Commission. In return, he received assurances that he would serve no prison time. John Huang pleaded guilty a few months later to an unrelated federal charge that during 1992-94, before taking his Commerce Department job, he'd made an illegal $2,500 contribution to the unsuccessful 1993 Los Angeles mayoral campaign of Michael Woo and a $5,000 contribution to a Democratic fundraising operation, the California Victory Fund. In return, he was granted immunity from prosecution for his Clinton fundraising activity. Huang was a tough guy to squeeze, having taken the Fifth Amendment over 2,500 times when asked if he was an agent of the People's Liberation Army of China. James Riady was indicted following the Senate investigation and wound up pleading guilty in January 2001 to campaign finance violations. He was ordered to pay a fine of $8.6 million. LippoBank California pleaded guilty to 86 misdemeanor counts related to James Riady and John Huang's illegal foreign campaign contributions from 1988 through 1994.
In all, the Justice Department indicted 26 individuals and two corporations in this 'bamboo connection,' all of whom (save for the few who couldn't be found) pled guilty. And the Democratic Party had to return more than $2.8 million in illegal or improper campaign contributions, around 80 percent of which had been raised or contributed by two men -- Charlie Trie and John Huang -- who in effect had been on the payroll of the Chinese government.
Message to Hillary Clinton: China Is a Rival, Not a Partner
That is the context surrounding China's destruction of one of its satellites this January. And we haven't even covered auxiliary angles of the case, such as Vice President Al Gore's close fundraising relationship with the Hsi Lai Buddhist temple in the Los Angeles area or the $366,000 in illegal Democratic Party campaign contributions made by Taiwanese-born Southern California businessman Johnny Chung, who eventually pled guilty to federal bank fraud, tax evasion, and election law charges. The missile may have been launched from China, but somewhere, if one looks hard enough, it contained the words, "Made in Washington and Arkansas." Given the pattern of Chinese military espionage in this country established prior to the Nineties -- confirmed in a 1999 House report overseen by then-Rep. (and presently U.S. Securities and Exchange Commission Chairman) Christopher Cox, R-Calif. -- the lax oversight by the Clinton administration is nothing short of stupefying. The Cox committee had concluded that the Chinese, systematically and for years, had been penetrating our nation's nuclear labs, stealing classified military secrets to accelerate the design, development and testing of nuclear weapons.
Well, would you trust the Chinese? Current President Hu Jintao is a committed Communist, if far more in governing style than beliefs. His government has supplied expertise to develop North Korea's weapons-grade plutonium program, even as it has worked fitfully with our own government to end it. This past December the Chinese signed a $16 billion contract with Iran to buy natural gas and develop their oilfields, while remaining steadfastly unwilling to support our attempts to impose sanctions against that country's fundamentalist Islamic regime. In virtually all foreign conflicts between the Americans and the Russians, the Chinese have allied themselves with the latter, going so far as to buy naval-based nuclear missiles from the Russians. And China is expanding its military presence in a hurry. The London-based International Institute for Strategic Studies, in its annual publication, Military Balance, estimates that the People's Republic of China has increased its military spending by nearly 300 percent since the mid Nineties, buying advanced submarines, jet fighters, missiles and other weaponry.
These trends are of particular concern to Americans because our military is so heavily dependent upon satellite technology for activities such as targeting bombs, tracking weather changes, relaying communications, and spying. And satellites are vulnerable. If China's anti-satellite technology becomes armed with high-powered lasers, by no means a remote possibility, our entire military capability could be in jeopardy. A report to Congress nearly a decade ago stated, "China already may possess the capability to damage, under specific conditions, optical sensors on satellites that are very vulnerable to damage by lasers. However, given China's current interest in laser technology, it is reasonable to assume that Beijing would develop a weapon that could destroy satellites in the future." Loren Thompson, director of security studies at the Arlington, Va.-based Lexington Institute, notes, "Space is a much bigger part of our military posture than it used to be, so any effort by the Chinese or anybody else to jam our satellites is potentially a big deal." It's an especially big deal if that effort in any way was made possible by de facto bribes paid by the Chinese to the Democratic Party leadership.
Yes, there is common ground -- economic, cultural and even political -- between the U.S. and China. The Chinese certainly have come a long way since the dark days of Maoist rule, modernizing their economy and (less so) property rights. We enjoy more free trade and fewer travel restrictions. With Beijing serving as host city for next year's Summer Olympics, the Chinese government can be counted on to be on their good behavior for the time being. But not being an outright enemy is a lot different than being an ally. Latter-day Chinese nationalism has a xenophobic aggression easily overlooked. "Without a solid basis for a national identity," observes eminent MIT political scientist Lucian Pye, "it is not surprising that China's leaders tend to be thin-skinned and quick to take offense at any perceived slight. The overall effect of such hypersensitivity is a collective sense that China is being mistreated by a hostile outside world and that its leaders need to be aggressive in demanding greater dignity and respect from others." In such a worldview, the accidental NATO aerial bombing of the Chinese embassy in Belgrade in May 1999 was no accident. Adding to the tension, to be blunt, is a racial animus. That many of the key people in this spy ring originated from Taiwan and Indonesia, ostensible adversaries of the People's Republic of China, is of far more than passing significance.
The prospect of a China fully prepared for modern warfare, playing on our level, ought to induce campaign reporters to forget the old Washington axiom about not fighting "yesterday's battles." They should remind Mrs. Clinton that her husband's tenure as president, which he vowed from the outset would be the "most ethical administration in the history of the country," managed to produce serious breaches in America's national security that every subsequent administration, including the current one, must face. As she billed that presidency as "two for the price of one," she should be held accountable.
Adams, James Ring. "John Huang's Bamboo Network," The American Spectator, December 1996, pp. 24-27, 87.
de Borchgrave, Arnaud. "China's Shot in the Dark," United Press International, January 29, 2007.
"China Jamming Test Sparks U.S. Satellite Concerns," October 5, 2006, Reuters, http://www.usatoday.com/tech/news.
Dorn, James and Wang Xi, eds., Economic Reform in China: Problems and Prospects, Chicago: University of Chicago Press, 1990.
Elliott, Michael et al., "The Chinese Century," Time, January 22, 2007, pp. 32-42.
Kislyakov, Andrei. "The Chinese Satellite Killer," Space Daily, January 29, 2007, http://www.spacedaily.com/reports.
Pye, Lucian W. "Understanding Chinese Negotiating Behavior: The Roles of Nationalism and Pragmatism," in Between Diplomacy and Deterrence: Strategies for U.S. Relations with China, Kim R. Holmes & James J. Przystup, eds., Washington, D.C.: The Heritage Foundation, 1997, pp. 211-39.
Timmerman, Kenneth R. "The Peking Pentagon," The American Spectator, April 1996, pp. 24-31.
Timmerman, Kenneth R. "All Roads Lead to China," The American Spectator, March 1997, pp. 30-38.
Timmerman, Kenneth R. "While America Sleeps," The American Spectator, June 1997, pp. 34-41, 78-79.
Timperlake, Edward and William C. Triplett II. Year of the Rat: How Bill Clinton and Al Gore Compromised U.S. Security for Chinese Cash, Washington, D.C.: Regnery, 1998.
U.S. Department of Defense, Future Military Capabilities and Strategy of the People's Republic of China, Report to Congress Pursuant to Section 1226 of the FY98 National Defense Authorization Act, Washington, D.C.: Department of Defense, November 1998.
U.S. House of Representatives. U.S. National Security and Military/Commercial Concerns with the People's Republic of China, Select Committee Report, May 25, 1999, http://www.house.gov/coxreport.
U.S. Senate, Committee on Governmental Affairs. Investigation on Illegal or Improper Activities in Connection with the 1996 Federal Election Campaigns, Majority Report: Executive Summary, March 5, 1998.
Walsh, Edward and Roberto Suro. "Clinton Fund-Raiser Huang to Offer Guilty Plea," Washington Post, May 26, 1999.
Yost, Pete. "Clinton Calls Arms Dealer's White House Visit Inappropriate," Associated Press, December 20, 1996.