The AmericanSpectator

November 1998

The DNC's Chinese MoneyLaundry--

The Year of theRat:

How Bill Clinton CompromisedAmerican Security for Chinese Money

BY Kenneth R.Timmerman


Kenneth R. Timmerman, publisher of Iran Brief, is a frequentcontributor to TAS.


The DNC's Chinese Money Laundry

The Year of the Rat: How Bill Clinton Compromised AmericanSecurity for Chinese Money :by William C. Triplett II and EdwardTimperlake :Regnery / 256 pages / $24.95

If Bill Clinton and Al Gore are hoping that Topic A willindefinitely deflect public opinion from their appalling nationalsecurity record until after the November 1998 elections, they shouldthink again. In The Year of the Rat, two top congressional aides wrapup this administration's fundraising scandals with refreshingclarity, linking them to a concerted plan by the Chinese CommunistParty to infiltrate the United States government, stealhigh-technology, and acquire strategic intelligence, all with thegoal of allowing China to dominate Asia in the twenty-firstcentury.

Nineteen ninety-six was the Chinese Year of the Rat, and accordingto William C. Triplett II and Edward Timperlake, the rats were soplentiful at the Clinton White House that only a thoroughhouse-cleaning will rid the place of the Chinese intelligence agentsand mobsters to whom the Clintons are beholden. Their main thesiswill not surprise readers of TAS: Bill Clinton made a series ofFaustian bargains with the Communist Chinese and their agents in theUnited States, trading national security for hefty campaigncontributions that ultimately financed Dick Morris's now infamousmedia blitz in late 1995 and 1996. Clinton's betrayal ranged fromleaking classified intelligence documents to wittingly assisting themodernization of the People's Liberation Army (PLA). The authors givenew substance to Senator Fred Thompson's cryptic suggestions of amethodical game plan organized by the PLA, China's intelligenceservices, and the Chinese mob to infiltrate and ultimately controlthe American political establishment.

The Year of the Rat draws on the raw data files of SenatorThompson's investigation of the campaign finance scandals; interviewswith former and current intelligence officials; and the authors' ownreporting in Hong Kong and Macau, where they unmasked the Triadconnections of DNC fundraiser Charlie Trie and his mob backer, themysterious casino operator Ng Lapseng. The book also shows that theFBI, CIA, and NSA investigations of Bill Clinton's ties to CommunistChina are ongoing, serious, and could reveal grave damage to U.S.national security.

Item: John Huang--Lippo Bank official, friend of Bill, andrepresentative of ethnic Chinese magnate Mochtar Riady--was actuallyan agent of Chinese intelligence, working under cover in the UnitedStates. The Riadys and their Chinese Communist intelligence bossesplaced Huang at the Clinton Commerce Department in 1994, with theprimary goal of gaining access to classified U.S. government filespertaining to China, U.S. investments in China, and counter-intelligence investigations of Chinese agents operating in the U.S.When security-conscious officials in the administration balked atplacing Huang in such a sensitive position in June 1994, the Riadysturned to Hillary Clinton and offered to buy Huang's appointment withhush money payments to Webster Hubbell, the authors assert. Part ofthe money was doled out directly by Lippo, which paid Hubbell a$100,000 consulting fee that Hubbell has never explained. Further(and as yet unreported) payments came from Ng Lapseng, Triadgodfather and financial backer of Clinton crony Charlie Trie. OnMonday, June 20, 1994, the same day that Hubbell met with Mrs.Clinton to explain his dire financial straits, Mr. Ng "quietlyarrived in the United States from Macau carrying $175,000 in cash,"part of which the authors state made its way to Hubbell. Less thanone month later, Huang started work at the Commerce Department.

Item: CIA representatives told the Thompson committee that duringhis brief tenure at the Commerce Department, Huang saw "between 370and 550 CIA- produced pieces of American intelligence," including atleast three documents marked MEM DISSEM. This was a classificationcode that meant: "unauthorized disclosure could result in the deathof an asset." The authors comment: "The CIA surely does notexaggerate when it refers to these sources as 'extremelysensitive.'"

Item: When Dick Morris informed Clinton that his 1996 electioncampaign would fail without an expensive media blitz, Clinton turnedonce again to the Riadys, who agreed to place Huang at the DNC as afundraiser, so that they could funnel yet more money through a seriesof cut-outs to the campaign.

During the 1992 campaign, Bill Clinton and Al Gore repeatedlychastised President Bush for "coddling dictators" in Peking. ManyDemocrats in Congress believed that with Clinton's election, theWhite House would finally begin to support congressional efforts toblock Most Favored Nation trading status with Peking, at least untilChina improved its behavior on human rights. What they didn't knowwas that behind the scenes Bill Clinton had already made a deal thatwould make Bush's temporizing on MFN look like firm moralleadership.

Only days before Bill Clinton took office in January 1993, JamesRiady and John Huang of Indonesia's Lippo Group donated $100,000 tothe Clinton-Gore inaugural fund. Less than one month later, Huangwrote Clinton to arrange a White House visit for Riady's father,Mochtar. The elder Riady spelled out his interests in a "Personal& Confidential" letter to Clinton on March 9, 1993, which urgedthe new president to drop his opposition to MFN. "The best way ofachieving political reform in China is through capitalistinteraction," Riady argued. As the authors show, he was anxious toprotect billions of dollars of investments in Communist China and thefortunes of Communist Chinese cronies known as the Princelings.

The first hint that Clinton had decided to tilt toward China--andrenege on his campaign promises--was delivered by Ron Brown on April27, 1993, at a meeting with Asian-American business leaders in LosAngeles. "I tend to agree that the best way to apply pressures for amore liberal policy in China would be through open trade," Brownsaid, echoing the Riady letter. "I would be surprised if China'smost-favored nation status is not renewed." At the time, no onenoticed the Asian-American "leader" who had asked Brown the questionon MFN. His name was John Huang.

John Huang was appointed a trustee of the Democratic NationalCommittee shortly after that Los Angeles rally. He became so close tothe former DNC chairman that Brown asked on Jan. 31, 1994, that he begiven an interim top- secret security clearance for possible work atthe Commerce Department.

The authors of The Year of the Rat offer astonishing new evidenceof Huang's ties to Chinese intelligence, noting the value of the TopSecret documents he spirited away from the Commerce Department to aprivate office maintained for him in the nearby Willard Hotel byStephens Inc., Arkansas cronies of President Clinton and businesspartners of the Riadys.

They report that a former Stephens secretary testified during theThompson hearings that:

-- Huang walked across the street to the Stephens office two orthree times a week carrying a folder or small briefcase.

-- He received overnight packages and faxes at the office.

-- He sent faxes out of the office, used the copier, and madetelephone calls from a small office set aside for visitors.


The authors write: "It is abundantly clear that Huang did not wantanyone to know of this arrangement," and systematically disguised hisrelationship with the Riadys, Stephens Inc., and the Chinesegovernment. The classified documents Huang allegedly sent to Lipponot only touched on U.S. national security concerns, such asencryption, but included other "insider information" of a morecommercial nature, which the authors assert could have been worthbillions of dollars to the Riadys since it allowed them to timestrategic investments in China in accordance with secret policydecisions by the U.S. government.

It may have been that Huang made additional, as yet unrevealed,business deals with President Bill Clinton from the Stephens officeat the Willard. We are told that the National Security Agency haselectronic intercepts of telephone calls between the President andJohn Huang laying out the details of these arrangements.

Huang and the Riadys were but one chapter in the Clinton sell-outto China. The "open door" policy put in place by top appointeesallowed Chinese intelligence agents to walk through sensitivemilitary plants in the United States--including our nuclear weaponslabs--taking video footage of classified assembly lines andtransmitting them back to analysts in Peking. In this way, the ChinaAero-Technology Import-Export Company (CATIC) acquired an entireproduction line from a former B-1 bomber plant in Columbus, Ohio, andtransferred it to a military production plant in China. According toa June 1994 Department of Defense strategic assessment, the dealconstituted "a total turnkey transfer of a military aerospacefactory" to China. The authors also assert that "at least some of themachine tools made their way to a PLA cruise missile plant."

The White House sponsored a bid by the state-owned China OceanShipping Corp., COSCO, to lease the navy yard at Long Beach,California, despite evidence that COSCO was running hostileintelligence operations in the United States and had been involved ingun-running and drug-trafficking. President Clinton made no fewerthan five trips to Long Beach over an 18-month period to lobby thetown council in favor of the deal, which was finally put on ice afterstrong protests in Congress and by local residents. The COSCO dealwould have allowed the Chinese to conduct electronic espionageagainst such top secret facilities as Lockheed's famed "Skunk works,"where the Stealth Fighter and other top-secret weapons systems aredeveloped.

Some of the harshest condemnation in The Year of the Rat isreserved for Clinton Defense Secretary William Perry, recognized bythe authors as " one of America's most brilliant militaryscientists." Perry's arrival at the Pentagon as deputy secretary inthe spring of 1993 "caused an immediate reversal when it came to theChinese military." One of the first results was the sale oftelecommunication and encryption gear to the PLA by Perry crony JohnLewis (first reported in these pages in "Peking Pentagon," April1996). But that was only the beginning.

Once Perry became Defense Secretary in the spring of 1994, helaunched a series of military exchanges between the United States andChina that included sharing nuclear and strategic planning secretswith the Chinese, 19- gun salutes from the Pentagon honor guard tothe perpetrators of the 1989 Tiananmen Square massacres, andastonishing access to our best protected defense secrets.

"The administration's biggest mistake in military-to-militaryrelations is its obsession with training the PLA in logistics," theauthors write. "Any analysis of the PLA will show that modernlogistics is one of its major weaknesses, a weakness we should notwant to see fixed. Logistics is real war fighting capability. But theClinton administration has quietly welcomed a number of PLA logisticsteams to the United States. For example, the PLA was told thatFedEx's system of package distribution at the Memphis, Tennesseeairport is about 95 percent similar to the U.S. military's wartimelogistics system. Senior PLA officers have been to Memphis repeatedlysince the fall of 1996."

Another target of the authors is national security adviser SamuelR. "Sandy" Berger. A long-standing friend of Bill who first metClinton during the 1972 McGovern campaign, Berger was aWashington-based lawyer-lobbyist at Hogan and Hartson before joiningthe administration in 1993. One of his main clients, according to theauthors, was the trade office of the Chinese government. " Underthese circumstances, we believe that Berger should have recusedhimself from anything having to do with the PRC, certainly anythingto do with trade." Instead, "it was Berger who led the charge torepeal export controls on satellites for China."

If you thought you already knew all there was to know about theChina scandals, think again. The Year of the Rat is most remarkablefor its masterful weaving of the various strands of the fundraisingand national security scandals together into a single, coherenttapestry whose underlying theme is political corruption.

"Political corruption is like a cancer," the authors state inconclusion. " If not defeated, it continues to replicate....On theRepublican side some consultants are beginning to talk quietly of a'if you can't beat 'em, join 'em' political strategy....Unless thecancer is halted promptly, this kind of thinking will surely spread.The Republicans will find themselves making the same sort of Faustianbargains for the soul of their party that Clinton and Gore did."