By Timothy W. Maier , Insight
While political enemies trade blame for the Chinese espionage incident at the Los Alamos nuclear labs, many helped provide China with modern ICBM technology.
The political blame game has begun. The Los Alamos espionage caper in New Mexico concerning a Taiwan-born scientist accused of providing Beijing with classified design secrets about W-88 nuclear warheads has erupted amid plenty of ducking, covering and finger pointing.
Clinton Cabinet officials from Energy Secretary Bill Richardson to National Security Adviser Sandy Berger claimed a breakdown in communications prevented them from responding adequately to the charges. Clinton denied allegations in a New York Times story accusing him of dragging his feet on the probe in return for campaign dollars.
Meanwhile, Insight has learned that Adm. Joseph Prueher, commander of the Pacific region, is lobbying hard to replace former Democratic senator James Sasser as U.S. Ambassador to China. But Prueher's name has stirred national-security passions on Capitol Hill where conservative Republicans are planning an all-out attack to prevent his nomination because of his reluctance to engage and resist the expanding claims of military hegemony by Communist China. Prueher failed to respond adequately last year to former House Rules Chairman Gerald Solomon's concern about the threat posed by the China Ocean Shipping Co., or COSCO, which so nearly took control of a longtime U.S. Navy port at Long Beach, Calif., and now controls bases at both ends of the Panama Canal. This did not sit well with many Republicans.
Presidential hopefuls are working to spin the espionage caper to their advantage. Vice President Al Gore blamed the Reagan administration for the incident but found himself slam-dunked the next day by the liberal Washington Post for not being "angry" about the Los Alamos incident. Former Vice President Dan Quayle charged that Clinton's dual-technology transfer program allowed Beijing to complete the nuclear puzzle by providing delivery systems to nuke American cities -- only to be blasted for George Bush's cozy relationship with the Kissinger group, which has a huge economic stake in China.
But Clinton and Gore have much explaining to do. Both knew about the Los Alamos espionage in 1995, yet they continued to entertain Chinese generals by allowing them to tour nuclear facilities and gladly received financial donations from Beijing and its friends. A year after the theft of nuclear secrets was discovered, instead of exposing the spies, Clinton made it easier for Beijing agents. He transferred licensing requirements from the State to the sales-oriented Commerce Department. This accelerated the pace at which Beijing obtained dual-use technology to build nuclear weapons and missiles.
Next came the most significant damage to U.S. security since the days of the Rosenbergs. Dr. Wah Lim, then a Loral Space and Communications scientist, headed a team of scientists studying Beijing's rocket failures when he called his assistant to fax to China a sensitive accident-analysis report that intelligence agents say greatly enhanced the accuracy of Beijing's missiles. Lim's attorney calls it a "technical violation." But Lim, now with Hughes Electronics, is the target of a U.S. Justice probe.
Even so, Clinton's deadly game of mixing fund-raising and commerce doesn't let the Republicans off the hook. The damage began in the Reagan years, according to Reagan insiders, who say the trade-lobby effort led by Henry Kissinger, secretary of state under Richard Nixon, and Alexander Haig, Reagan's first-term secretary of state, seriously compromised U.S. national security. Kissinger and Haig refused to return Insight's calls to discuss this.
In 1982 a wary President Reagan had created a security-review team consisting of representatives of the National Security Council, FBI, CIA and Department of Defense to review business deals involving possible military dual-use technology. This put an anticommunist intelligence player at the negotiating table. The Senior Interdepartmental Group/International Economic Policy was not popular with Kissinger's pro-China lobby, says a former member of the group, who spoke with Insight on condition of anonymity.
By 1985, with his anticommunist efforts under furious attack from the left as well as by powerful U.S. corporations trying to reap quick profits from China deals, the Reagan administration dismantled the Interdepartmental Group and "separated the national-security community from the international economic community," the source tells Insight. "Reagan was listening to the complaints in the business community that national security was preempting or dominating their quest for exports and jobs, and the result is what you see today. The business voice eventually became dominant, and that's a recipe for disaster."
Thor Ronay, former chief of staff for the General Service Administration under Reagan and now with the Center for Security Policy, says Reagan shouldn't be held responsible. He was not aware of many of the dual-use deals, Ronay says. When Reagan was told by NSC about a deal he sided with national security, Ronay says. The problem became that the decisions on dual-use were being made at lower levels within the State Department even as Reagan's NSC staff was all but turned over to career State Department people with little experience in intelligence matters. And in cases in which Reagan had to be made aware of possible dual-use technology transfers to China, he often had to weigh the discomforts such transfers might cause the Soviet Union along the Sino-Soviet border.
Meanwhile, Kissinger played a pivotal role in persuading elements of the State Department and administration that China posed no threat, Ronay says. Kissinger was joined in this later by Bush's national-security adviser Brent Scowcroft, who also encouraged high-tech trade with China. Later, Haig became a paid adviser to COSCO, which since has set its sights on taking over a Los Angeles port. But it is Clinton who took it to a deadly level by delivering the keys to launch intercontinental ballistic missiles against the United States, taking away the last measures of the Reagan and Bush trade defense. Clinton dismantled the Coordinating Committee for Multilateral Export Controls, a 16-nation group that regulated strategic transfers. This further accelerated the speed at which Beijing and other potential adversaries were able to obtain dual-use military items such as the supercomputers used to design nuclear weapons based upon plans stolen from the U.S. national labs. "It's at warp speed now," Ronay says. "We shouldn't be just worried about the W-88. But what about the W-99?"
As we go to press the White House still has refused to declassify for release the 700-page report of Chairman Chris Cox's House Select Committee on U.S. National Security and Military/Commercial Concerns with the People's Republic of China. For months Rep. Dana Rohrabacher, like Cox a California Republican, has demanded the report be made public.
Insight has learned the report includes financial records, rocket photography and allegations of espionage -- plus details about the Los Alamos thefts and others as well as scenarios concerning ways the People's Liberation Army, or PLA, acquired dual-use technology contracts with U.S. businesses. Cox's investigators held 22 hearings, heard more than 200 hours of testimony and conducted more than 700 hours of interviews.
This magazine also has learned that the report does not detail the Clinton/ Gore campaign-finance aspects of this scandal that House Government Reform and Oversight Chairman Dan Burton of Indiana is anxious to see. Rather, it is an evenhanded, almost lawyerly, report that carefully avoids partisan politics.
The report details how U.S. intelligence agencies learned of the thefts at the labs from a series of Chinese nuclear tests. That led investigators to the security lapses at the Los Alamos Lab where Wen Ho Lee, a Taiwan-born nuclear weapons designer, became a prime suspect. Lee, who has not been charged, went into hiding after being fired when he was named on the front pages of the nation's newspapers.
"I've heard from people who have seen the Cox report," says Henry Sokolski, a former Pentagon nonproliferation official who now heads the Washington-based Nonproliferation Policy Education Center, "and the damage goes far beyond the W-88 issue. It's pretty bad." Some have jumped the gun by claiming this espionage is comparable to the Rosenberg case, but it is not yet at that level, Sokolski says. "The Rosenbergs helped confirm our worst fears and validated the hard line towards Russia. The jury is still out as to whether this is as important as the Rosenbergs because we haven't seen any change in policy toward China. Not yet."
Of course, security problems at the national labs existed even under the Reagan administration, which was warned of poor background checks by a series of General Accounting Office reports. Reagan ordered more-thorough background checks, only to have the program fall back into numerous exceptions when national security again took a backseat to business contracts. Under Clinton, GAO reports warned that the Clinton people either were ignoring background checks or pushing them forward for those who had connections to Democratic campaign coffers. And rather than taking action, Clinton made it easier for more and more foreigners to visit the facilities and actually to participate in some lab programs -- moves that Clinton officials say did not compromise security. The GAO reports strongly contradict these assertions.
A growing number of congressmen have called for an outright ban of foreign visitors to the nuclear labs, and others are suggesting China should lose its "most favored nation" status and be barred from entrance to the World Trade Organization. Beijing's friends, bought and otherwise, claim China has no intention of engaging in a nuclear attack against the United States. But any who believe that, says military expert Al Santoli, a defense aide to Rohrabacher, should review their military and diplomatic history. "The same thing was said about Japan in 1930," says Santoli. "The British built the Japanese navy in the 1920s and they didn't think they would be attacked. History is full of examples. The problem is that Congress doesn't pay attention to history."
Regardless, nothing yet has been done to deal with the immediate problem of restoring Reagan's national-security review team to the contract-negotiating tables -- which intelligence experts say should be done immediately. There is growing concern that this is not likely to happen until the true extent of the PLA's penetration of American security and policymaking fully is understood. Insight reported two years ago that the PLA is operating more than 700 cover companies in the United States for the purpose of stealing technology as well as continuing espionage against U.S. facilities. It is abundantly clear that the mission of these fronts and agents is to expand the Chinese nuclear and missile programs, according to intelligence experts.
"For the longest time U.S. analysts on China have emphasized how small China's nuclear forces have been and how they have remained that way," says Sokolski. "The significance of this latest incident shows that it is much more sophisticated and significantly larger."
Indeed, the whole South China Sea region, including the Republic of China on Taiwan, the Philippines, Malaysia and Japan, is at risk of nuclear bullying or even attack. Many of these countries have been in a serious dispute with China concerning the Spratley Islands, believed to be rich in oil reserves.
A 27-page Pentagon report obtained by Insight anticipates an attack by China against Taiwan in 2005. The report, requested by Sen. Frank H. Murkowski, an Alaska Republican, describes the current relationship between China and Taiwan as "calm" in the wake of Beijing's test launch of missiles in March 1996 but projects a very serious situation within six years.
By 2005, according to the intelligence projection, Beijing will be in a position to "implement naval blockade; establish air superiority; conduct an amphibious invasion of Taiwan; and gain information dominance." While the free Chinese have made "improvements to Taiwan's missile and air-defense systems," the report warns, "by 2005, the PLA will possess the capability to attack Taiwan with air and missile strikes which would degrade key military facilities and damage the island's economic infrastructure. China will continue to give priority to long-range precision-strike programs."
Both Republicans and Democrats are calling the report worrisome. "We've got to protect Taiwan," Sokolski warns. "We've got to decide what kind of China we want. Do we want China to follow Taiwan? We've got to protect those guys for everyone's sake. A self-government shouldn't be taken for granted, or neglected."
Only a few years ago Beijing brushed off U.S. support of Taiwan with the crudely veiled threat that the United States cares more about Los Angeles than Taiwan. It was laughable then, considering that Beijing couldn't hit the side of a barn with its 19th-century technology. Today, after the Los Alamos caper, no one is laughing.
