Berger's China Work Makes Archive Heist Look Tame
Posted: February 2, 2007
© Jack Cashill
by Jack Cashill
Two weeks back, the Chinese military shocked America by shooting one of China’s aging satellites out of the sky with a ground-based missile. Old as the satellite may have been, it was still up 500 miles in space. This was a scarily impressive bit of saber-rattling.
As it happens, no American played a greater role in the success of that shoot-down than the much-discussed chairman and founder of Stonebridge International, Samuel “Sandy” Berger.
I do not know whether the results pleased Berger, but I cannot imagine a better advertisement for his subsidiary, Stonebridge China. Its boast of being able to penetrate China’s “central government” and “create circles of influence to champion specific business goals” was not an idle one.
Berger knows these circles well. During the Clinton years, according to the New York Times, he served as “the point man for the White House’s China policy.” That policy, unfortunately, had more to do with advancing Bill Clinton’s reelection in 1996 than it did with advancing America’s interests in the world.
By early 1996, with Dick Morris’s dubious anti-Congress ads still running full tilt, President Clinton was polling 53 percent in a conceptual one-on-one against Bob Dole. A year earlier, before Morris’s multi-million dollar ad campaign, Clinton was polling 33 percent in the same imagined race.
During that year, Clinton had done almost nothing presidential to merit the boost. His comeback was a tribute to the powers of unethical advertising, illicit fund-raising, and a quiescent media. Observed Labor Secretary Robert Reich acidly, “The only process we have is Dick Morris.”
Chief among those financing the “process” was Loral Aerospace honcho Bernard “Bernie” Schwartz, a dead-on, real-life incarnation of Catch 22’s Milo Minderbinder.
“Maybe they did start the war,” says the fictional war profiteer Minderbinder, “and maybe they are killing millions of people, but they are paying their bills a lot more promptly than some allies of ours I could name. Don’t you understand that I have to respect the sanctity of my contract with Germany?”
One can hear Schwartz making an almost identical pitch to Bill Clinton. He had purchased the rights to do so. Before this election cycle was over, he would officially donate more than $630,000 in soft money to the DNC, fifty times what he had given in the last presidential election. No Democrat gave more.
In early 1996 Schwartz’s money mattered. The Clintons were just beginning to smell victory. To secure it, they had to continue feeding the TV beast. They had fully ignored all FEC restrictions and were using soft money as though it were hard. Better still, the media had chosen not to see.
In February 1996, Commerce Secretary Ron Brown was dispatched to New York to pick up checks from Schwartz in person. It was the president’s way of signaling his obeisance. For all his failings, it disgusted Brown that Clinton had turned him into little more than a “bagman.”
Schwartz did not make his donations in an informational vacuum. According to the New York Times, “February 1996” represented a moment of keen impasse between warring forces within the Clinton administration. With his generous support, Schwartz surely was hoping to breach the enemy’s defenses.
The enemy in this case was his own Pentagon and intelligence community. Much to Schwartz’s frustration, they were standing firm on the question of commercial satellites.
Given the vital technology contained therein, much of it secret, they had convinced Secretary of State Warren Christopher in October 1995 to keep the satellites on the so-called ‘‘munitions list,’’ an inventory of the nation’s most sensitive military and intelligence-gathering equipment.
Almost immediately, Sandy Berger, then deputy national security advisor, had begun plotting to undermine Christopher. In November 1995 Berger sent a memo to Christopher’s deputy and long time Clinton buddy, Strobe Talbott.
Berger claimed that Ron Brown, who “was far more sympathetic to the satellite makers,” would appeal Christopher’s ruling to Clinton. Clearly, Berger was setting up a paper trail that led directly to the hapless commerce secretary. He then added, as if Talbott needed to be told, ‘‘I, too, have real questions about the wisdom’’ of Christopher’s decision.
Berger, a trade lawyer by profession, had no real foreign policy experience before becoming the number two-man on the National Security Council. Like Talbott at State and Jamie Gorelick at Justice, Berger functioned more or less as the “political officer” within his department.
Still, despite Berger’s machinations, and the president’s obvious support, the serious professionals within the National Security Council, State, and Defense were resisting the wholesale transfer of licensing authority for these satellites to the Commerce Department. Once moved to Commerce, the military feared it would lose veto power over exports.
The president also faced strong resistance from the genuine liberals within the administration. In the margin of a December 1995 document, for example, senior advisor George Stephanopoulos scrawled a vulgar note strongly criticizing the president’s China policy.
Soon after he returned from his New York rendezvous with Schwartz, Brown learned he would be meeting—by order of the White House—with a character by the name of Wang Jun. The sheer bravado of Wang Jun’s petition and the brazenness of the Clintons in welcoming him leave one awestruck.
Wang Jun chaired Poly Technologies, a company controlled by the People’s Liberation Army. According to a Rand Corporation report forced from the U.S. Department of Commerce by a federal lawsuit, one of Poly Technologies’ profit centers was the “importation and distribution of semi-automatic rifles for the U.S. domestic market.”
Between 1987 and 1993, the company and its affiliates sold more than $200 million worth of these guns in the United States. When Clinton piously signed into law the banning of certain semi-automatic weapons in 1994, Poly Technologies only profited. They exploited export loopholes to circumvent the ban and ultimately resorted to old-fashioned smuggling.
On the day of the Wang Jun meeting, February 6, 1996, Brown did not know about Wang Jun’s arms trade. Brown only knew the meeting was to be about satellite export controls.
This makes sense as Wang Jun also owned a huge stake in a Hong Kong satellite company. Brown’s task was to assure the Chinese that America intended to be a most friendly trading partner and if Wang Jun ever had any problems dealing with the United States, he could call Brown directly at anytime.
Brown had little choice in the matter. Later that afternoon, the White House also insisted that he join Wang Jun at an intimate “coffee” with President Clinton. It was an only-in-America kind of moment. Wang Jun, who had cut arms deals with Chinese allies in places like Libya, Iran, Serbia, Iraq, and Afghanistan, now found himself at a cordial private coffee with—of all people—the president of the United States.
This friendly meeting occurred less than four years after Clinton had excoriated the first President Bush for “coddling tyrants” in Beijing and conducting “business as usual with those who murdered freedom at Tiananmen Square.” No matter.
Clinton pal Charlie Trie had greased the Wang Jun meeting with a $50,000 payment. To the president’s humble credit, as the Thompson Committee would later report, he did admit that the meeting with the PLA arms dealer, Wang Jun, was “clearly inappropriate.”
The president did not apologize, however, for signing waivers for four more satellite launches by Chinese rockets on that same February day. The president approved these waivers despite reports the month before that China continued to export nuclear technology to Pakistan and missiles to Iran, the latter deal Wang Jun was suspected of brokering.
Just a week or so after Wang Jun’s excellent Washington adventure, a Chinese Long March 3B rocket carrying the Loral-built Intelsat 708 satellite crashed just after liftoff and killed or injured at least sixty people in a nearby village. This was the third Long March failure in the last three years involving U.S.-built satellite payloads.
The Pentagon welcomed the news of the Chinese failure. With the collapse of the Soviets, the People’s Republic had emerged as America’s most serious potential enemy, and its leaders weren’t afraid to say so.
Just a few months earlier, in fact, a Chinese Military officer had warned American ambassador Chas Freeman, “If you hit us now, we can hit back. So you will not make those threats [about Taiwan].” The officer then proffered the following not so cryptic caveat, “In the end you care more about Los Angeles than you do about Taipei.”
American technical advice was making these Chinese boasts more than an empty threat. And yet in their relentless drive to raise money, the Clintons were fully prepared to broker that advice. In March 1996 Berger pressed on and managed to finesse a compromise that sent satellite control to Brown at Commerce and cost the Pentagon its veto power.
According to the Times, which reviewed thousands of pages of unclassified documents, the deal was closed in a series of telephone calls involving Berger, Talbott, Brown, and John White, the deputy defense secretary. Tellingly, the Times’ review “found no indication that Mr. Christopher was personally involved in the president’s decision.”
On March 12, 1996 the president signed off on a “decision memorandum” that reversed Christopher’s decision and awarded authority over satellite-export licensing to Commerce. Said an attached memo, ‘‘Industry should like the fact that they will deal with the more ‘user friendly’ Commerce system.’’
Feeling confident about his relationship with the president, Schwartz up and dispatched a Loral-led review team to China to assess the February 1996 failure of the Long March 3B rocket and suggest refinements.
The Cox Committee would later describe Schwartz’s actions as “an unlicensed defense service for the PRC that resulted in the improvement of the reliability of the PRC’s military rockets and ballistic missiles.”
So serious was the offense that in 1998 the Criminal Division of the Justice Department launched an investigation. Incredibly, while the investigation was in process, Berger, now national security advisor, sent a memo to the president urging him to “waive the legislative restriction on the export to China of the communications satellites and related equipment for the Space Systems/Loral (SS/L) Chinasat 8 project.”
This waiver would present a huge problem for the prosecution. Berger admitted as much: “Justice believes that a jury would not convict once it learned that the president had found SS/L’s Chinasat 8 project to be in the national interest.”
But Berger was not about to let that stop him: “We will take the firm position that this waiver does not exonerate or in any way prejudge SS/L with respect to its prior unauthorized transfers to China.” Berger was blowing smoke, and he knew it. A waiver would make prosecution all but impossible.
The president could only issue a waiver, however, if it served America’s “national interest.” Berger made an almost comically specious case that it did, arguing satellite technology would give remote Chinese villagers access “to people and ideas in democratic societies.” During these misbegotten years, one trembles at what the villagers might have learned about American democracy.
For its part, Loral had no greater cause than its own bottom line. “If a decision is not forthcoming in the next day or so, we stand to lose the contract,” Loral lobbyist Thomas Ross wrote Berger. “In fact, even if the decision is favorable, we will lose substantial amounts of money with each passing day.”
So much for the national interest. Ross then added the kicker, sure to win the president’s heart. “Bernard Schwartz had intended to raise this issue with you at the Blair dinner, but missed you in the crowd.” Schwartz knew he had a friend in the White House. The president approved the waiver, and the prosecution came to naught.
This story merits its own book, but what deserves immediate comment is the willingness of Berger and the Clintons to risk everything to keep the cash pipeline open. In his purloining of the National Archives, Berger risked everything once again. He and the Clintons have apparently come to take the major media’s complicity for granted.
As for Schwartz, he kept the cash pipeline open and full. Before he was through, Schwartz and Loral would donate roughly $2 million to the Clinton cause. Whether Schwartz gave additional money or favors off the books is a question that deserves asking. Before his untimely death in April 1996, Brown was reporting that he had.
Wang Jun ran into problems of his own when on May 23, 1996, CNN breathlessly reported “the largest seizure of smuggled automatic weapons in U.S. history.” The San Francisco Bureau of Alcohol, Tobacco and Firearms had infiltrated a smuggling ring and confiscated 2,000 fully automatic AK-47 rifles imported from China.
The weapons were found on board a COSCO ship, the enterprise that had been trying to secure the Long Beach Naval Station. CNN traced the rifles to Wang Jun’s Poly Technologies.
Wang Jun, however, had not wasted his investment. Someone in the know did the arms merchant a large favor by leaking the news of the BATF gun smuggling investigation well before it was wrapped up. The Bay-area bust was premature. The BATF was not able to nail the operation’s ringleaders. Like Sandy Berger himself, Wang Jun was freed up for further mischief.
We may never know what Berger stole from the National Archives or how much damage he did to the nation’s battle against Islamic terrorists.It is hard to imagine, though, that China would have developed the capacity to shoot satellites out of the sky—certainly not this quickly--without the help of its good friends in the White House. At the end of the day, this betrayal will make for an anxiety of much greater magnitude.
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