Chinagate: A U.S. Counterintelligence Failure


Clinton-Gore White House illegal fundraising, Chinese espionage, and the transfer of classified U.S. technology to the PRC as a quid pro quo for campaign cash


In order to maintain objectivity, equanimity, and accuracy in this work, I made a deliberate effort to maintain an impartial position in the collection and analysis of data pertaining to a major US  counterintelligence (CI) failure. The circumstances surrounding this CI failure would later become known as Chinagate.

Since I had little previous knowledge of the events and issues surrounding this particular CI failure, and hence no preconceived opinions or biases on the subject, I had no reason to slant, distort, suppress, or embellish my findings and analyses. Likewise, because my consumers are senior academicians from the US intelligence community, I had no motivation (e.g., self-protection from becoming the proverbial murdered messenger) to cook any part of my report.

Initially, in the collection phase of the project, I was challenged by what I had thought were insurmountable obstacles: Some of the most critical evidence was hidden by the Clinton administration and remained secret; over 120 witnesses connected with the related federal investigations fled the country or claimed Fifth Amendment privileges; the White House and the DNC refused to turn over scores of documents for review;  Clinton-Gore political appointees aggressively tampered with intelligence records; and a crucial witness, Commerce Secretary Ron Brown, was killed in an airplane crash.

Later, however, through the good offices of Larry Klayman and his public watchdog organization, Judicial Watch, I was able to circumvent my initial collection obstacles.  Documents released by the federal government, in compliance with a Freedom of Information (FOI) request submitted by Judicial Watchs legal staff, provided a plethora of information pertaining to the so-called Chinagate scandal.  Also, made available for public use were numerous photographs and dozens of videotapes.  Lastly, the good offices of U.S. Rep. Curt Weldon (PA-R) provided me with invaluable information on the transfer of prohibited U.S. technology to the PRC by the Clinton administration.

I     Introduction and Overview

My purpose in writing this paper is to present a study of the events surrounding a successful Peoples Republic of China (PRC) intelligence operation against the United States that ultimately represents a U.S. counterintelligence failure.

The conducting of espionage activities among nations is not an aberration. On the contrary, for centuries intelligence services have served their constituents by collecting information about friends and adversaries alike. 1 Today, not unlike in ancient times, espionage is routinely employed by governments as a mechanism to attain national policy and military objectives. Intelligence/counterintelligence operations between competing nations such as the United States and the PRC are thus viewed by security forces as standard and expected activities.

Intelligence analysts, when discussing the possible outcomes of a nations foreign intelligence initiatives, will often note that one sides intelligence success is the other sides counterintelligence failure. The confirmed evidence pertaining to Chinagate ominously points to the veracity of this catchphrase. Specifically, with the assistance of the Clinton-Gore White House, high priority Communist Chinese intelligence objectives were successfully achieved against the national interests of the United States. The Chinagate scandal, which centered around the Clinton-Gore administrations trading of U.S. national security for illegal Chinese campaign contributions, prompted Rep. James Traficant (D-OH) to announce in the U.S. House that its time to wake up and smell the treason. 2 Traficant was not alone in his outrage: 

Larry Klayman called the scandal perhaps the gravest example of espionage of this century. 3

U.S. Senator James Inhofe (R-OK) in a speech before the U.S. Senate declared Chinagate a threat to our national security…more serious than Aldridge Ames. Perhaps more serious than the Rosenbergs. 4

Then-presidential contender Pat Buchanan said that the allegations surrounding the transfer of atomic secrets to a potential enemy are the most serious since the Rosenbergs went to the electric chair on atomic espionage in 1953. Our security has been compromised, our technology stolen, and our cities placed in mortal peril. 5

The Augusta Chronicle reported: Now that the bipartisan Cox Report over massive Communist Chinese contributions and espionage has exploded like a bombshell on Capitol Hill, we are already hearing the T word uttered: Treason. How the Clinton administration allowed China to acquire, in the words of the report, supercomputers to simulate nuclear tests (and) satellite technology that might help aim ballistic missiles more accurately…against the United States and its allies is a story of an incredible betrayal of our national security. 6

Rep. Dan Burton (R-IN), Chairman of the Committee on Government Reform and Oversight investigating illegal PRC campaign contributions to the Clinton-Gore White House, informed the U.S. House of Representatives in 1999 of the following investigation results: Illegal campaign contributions have come in to the Clinton-Gore reelection committee. The head of the Chinese military and the head of the Chinese aerospace industry…have illegally funneled money into the Clinton-Gore reelection committee. We know for a fact that was going on. 7

Rep. Dana Rohrabacher (R-CA) similarly criticized Chinagate: There was massively deadly weapons technology that was transferred to one of the most ruthless dictatorships in the world, and it was done intentionally…. Its clear that the national security interests of our country have been violated and our people have been betrayed. And the people who betrayed it had dollar signs in their eyes so they couldnt see how much damage they were going to create for their fellow Americans. 8

We wont turn the Lincoln bedroom into a brothel, 9 snapped then-presidential contender Steve Forbes after being shown an official Democratic Party photograph of Bill and Hillary Clinton with Chinagate player, Ng Lapseng, a Macau organized-crime figure with ties to the Peoples Liberation Army (PLA), who made a fortune in prostitution and gambling. Rep. Dan Burtons Government Reform and Oversight Committee documented that Ng Lapseng visited the White House 12 times and wired at least $645,000 in illegally laundered campaign contributions through a cutout to the Democratic National Committee (DNC).

U.S. Senator Orrin Hatch (R-UT) expressed his views on Chinagate during a televised presidential campaign speech: Revelations about money laundering by the Clinton-Gore campaign suggested a web of foreign sources and connections so intricate and mysterious it sounded like the plot to an Oliver Stone movie…an astonishing range of allegations about illegal activities from perjury before Congress to damaging missile technology transfers and even the theft of nuclear secretsthat could actually help target Chinese missiles on the American homeland. 10, 11

Wall Street Journal reported: It came in the thick of the 1996 re-election we now know included campaign contributions from those with ties to the Chinese government, its military, and even its intelligence organizations. 12

The Washington Times declared that Chinese intelligence carried out a massive successful penetration of the White House itself. A number of persons identified by the CIA as associates of Chinese intelligence poured millions of dollars in illegal campaign funds into the 1996 Clinton-Gore re-election effort. 13   

The Philadelphia Daily News stated that Reno is not the only member of the Clinton administration who looks incredibly stupid: National Security Advisor Sandy Berger was told three years ago about suspicions, but did nothing. And President Clinton did what he often does best: When questioned in March, he lied. 14 

Rep. J.D Hayworth (R-AZ) addressed Newt Gingrich, Speaker of the House of Representatives: Mr. Speaker, what perverse pride can anyone derive from these revelations? Is there actual pride on the part of the Clinton-Gore gang and their fundraising this morning? Is there actual pride in the heart of Bernard Schwartz, the leading giver to the Democratic National Committee, whose firm, Loral, gave technology to the Communist Chinese? C. Michael Armstrong, the onetime CEO of Hughes, another company that gave technology to the Communist Chinese, can he feel pride at these revelations this morning? And finally and sadly, how proud the President and Vice President of the United States must be. Mr. Speaker, our constitutional republic has survived scores of scoundrels and scalawags, but to have those at the highest level of government speak of a strategic partnership with Communist China and then have it revealed in the fullness of time just what that strategic partnership meant, crass partisan, political advantage through scandalous fund-raising that has led us to this sorry state of affairs. 15    

Many congressional members, intelligence and law enforcement officials, government investigators, and informed private citizens have echoed the above-cited individuals and organizations in their concerns about Chinagate.

On January 3, 1999, the Select Committee on U.S. National Security and Military/Commercial Concerns with the Peoples Republic of China released the Cox Report on Chinese espionage against the United States. But before the findings of the Cox Commission were made public, the Clinton administration insisted on deleting a third of the original classified report. The publicized declassified version of the report still provides a frightening account of the PRCs successful intelligence penetration of the Clinton-Gore White House and the U.S. national weapons laboratories.

Some of the major conclusions of the bipartisan Cox committee of nine congressmen (five Republicans and four Democrats) are listed below:

The Peoples Republic of China (PRC) has stolen design information on the United States most advanced thermonuclear weapons.

In the late 1990s the PRC stole or illegally obtained U.S. developmental and research technology that, if taken to successful conclusion, could be used to attack U.S. satellites and (heretofore invulnerable) submarines.   

The Select Committee judges that the PRCs next generation of thermonuclear weapons currently under development, will exploit elements of stolen U.S. design information.    

Counterintelligence programs at the national weapons laboratories today fail to meet even minimal standards. 16

Defense Intelligence Agency (DIA) analyst Nicholas Eftimiades, in his book Chinese Intelligence Operations, identified the penetration of U.S. government agencies and the clandestine collection of advanced U.S. high-tech information as high priority objectives of the PRCs Ministry of State Security (MSS). 17, 18 

Eftimiades explained that the acquisition of U.S. high-tech information, used to develop Chinas ailing civilian and military industrial sectors, is of particular importance to Beijing. As a result, the PRCs intelligence operations against the United States have become so intrusive that senior U.S. law enforce