[Congressional Record Volume 143, Number 85 (Wednesday, June 18, 1997)]
[Extensions of Remarks]
[Pages E1253-E1256]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     THE PEOPLE'S REPUBLIC OF CHINA

                                 ______
                                 

                        HON. GERALD B.H. SOLOMON

                              of new york

                    in the house of representatives

                        Wednesday, June 18, 1997

  Mr. SOLOMON. Mr. Speaker, there were two excellent articles in two 
separate newspapers this morning. There is a common thread between 
them, and that is the People's Republic of China.
  A Bill Gertz article in the Washington Times describes the extent to 
which China is upgrading the capacity of Iran to sink American ships 
and kill American sailors. Gertz said the disclosures of Iran-China 
missile cooperation raises new questions about Clinton administration 
claims that China has been heeding United States warnings about curbing 
trade with Iran and other rogue nations on missile and weapons 
technology.
  But that's not all China has been doing, Mr. Speaker. They have been 
trying to influence American elections, and in this endeavor they seem 
to have gotten the cooperation of individuals serving in the Clinton 
administration. Which brings us to the second article, that of James 
Risen and Alan A. Miller in the Los Angeles Times about the security 
clearances of John Huang, who became a high Commerce Department 
official and campaign fundraiser, apparently while retaining his 
loyalty to the Lippo Group of Indonesia.
  I would urge all Members to read and re-read both articles, and I 
place them both in today's Record.

          China Joins Forces With Iran on Short-Range Missile

                            (By Bill Gertz)

       Iran is developing a new short-range ballistic missile as 
     part of a joint program with China involving rocket motors 
     and test equipment, The Washington Times has learned.
       Iranian missile technicians traveled to China early last 
     month to watch a ground test of a 450mm-diameter rocket motor 
     to be used in the NP-110 solid-fuel missile, according to a 
     Pentagon intelligence report labeled ``top secret.''
       The missile, which would have a range of 105 miles, would 
     be capable of hitting targets as far away as Baghdad and the 
     United Arab Emirates, while keeping the missile launchers 
     away from coasts, where they are vulnerable to counterattack, 
     said Kenneth Timmerman, director of the Middle East Data 
     Project, which tracks weapons programs in Iran.
       The joint missile program also involves Iran's use or 
     acquisition of Chinese X-ray equipment, which is used for 
     studying missile casings and for checking whether solid fuel 
     is in proper condition.
       Disclosure of the Iran-China missile cooperation raises new 
     questions about Clinton administration claims that China has 
     been heeding U.S. warnings about curbing trade with Iran and 
     other rogue states on missile and weapons technology.
       John Holum, director of the U.S. Arms Control and 
     Disarmament Agency, told reporters in November, after a visit 
     to China, that U.S.-China collaboration on arms control and 
     proliferation issues was ``very constructive,'' and said 
     Chinese progress on restricting destabilizing arms sales was 
     ``dramatic.''
       A classified CIA report in October said China had provided 
     Iran with missile guidance components and technology.
       ``This is a new [category] of missiles,'' Mr. Timmerman 
     said of the NP-110. ``It shows the Iranians have a very 
     advanced and multifaceted capability to produce solid-fuel 
     propellants.''
       In written statements to Congress made public last week, 
     Secretary of State Madeleine Albright said, 
     ``Iran's ballistic program poses a serious threat to 
     American servicemen and women.''
       ``Iran's ballistic missile program also poses a threat to 
     America's friends and allies in the region,'' she said in 
     response to questions by Rep. Gerald B.H. Solomon, New York 
     Republican.
       The administration has been ``reviewing carefully'' reports 
     of missile- and weapons-technology transfers from China to 
     Iran but has not decided whether the sales meet legal 
     thresholds for triggering sanctions, she said.
       Iran is known to have two types of Soviet-designed Scud 
     missiles, including systems acquired from North Korea or 
     developed in Iran.
       Less is known about its shorter-range missile programs, 
     including systems identified variously by military experts as 
     the Iran-130, the Mushak 120 and the Nazeat.
       According to Mrs. Albright, the Iranians are ``assembling'' 
     Scud-B missiles with a range of 186 miles that carry payloads 
     of up to 2,200 pounds.
       ``Iran is working to produce Scud-C missiles with a range 
     of 500 kilometers [310 miles] and a smaller payload than the 
     Scud-B,`` she told Mr. Solomon. ``We also believe Iran is 
     interested in developing even longer-range missiles.''
       The secretary said that ``given Iran's persistent efforts 
     to develop a nuclear, chemical and biological capability, we 
     are concerned that Iran may use this capability to develop 
     weapons-of-mass-destruction warheads.''
       The China Precision Engineering Institute New Technology 
     Corp. reached agreement with an arm of Iran's Defense 
     Industries Organization to sell gyroscopes, accelerometers 
     and test equipment--all elements used to build and test 
     missile-guidance systems, the CIA report said.
       Other military equipment was delivered in July 1996 as part 
     of a program to modify Iran's Chinese-made HY-2 anti-ship 
     missiles.
       Iran currently has about 200 Scud-B and Scud-C mobile 
     missiles. The Scud-B has a

[[Page E1254]]

     range of about 186 miles and the Scud-C can hit targets about 
     310 miles away.
       Iran also is believed by U.S. intelligence officials to be 
     interested in buying 620-mile-range No Dong missiles from 
     North Korea. The No Dong is said to be close to deployment.
       A U.S. intelligence report last month also revealed that 
     three Russian entities have signed contracts with Iran to 
     help produce liquid-fueled ballistic missiles. The Russian 
     contracts include projects for wind tunnels used in missile 
     design, model missile manufacture and development of computer 
     software.


     
                                                                    ____
              [From the Los Angeles Times, June 17, 1997]

              Huang's Security Status Raises New Questions

                  (By James Risen and Alan C. Miller)

       Washington.--In John Huang's strange odyssey into the heart 
     of the Clinton administration and the Democratic Party, few 
     things remain so shrouded in intrigue as the handling of his 
     coveted security clearances and his access to U.S. government 
     secrets.
       The former Commerce Department official and Democratic 
     fundraiser has played a leading role in the campaign finance 
     controversy since it erupted last fall. But now federal 
     investigators are looking into more serious questions about 
     whether Huang also, as a House committee chairman has 
     charged, ``committed economic espionage.''
       If Huang was supplying sensitive U.S. government 
     information to his Indonesia-based former employers or, more 
     troubling, the Chinese government, then the Commerce 
     Department may have been the perfect place for him to get 
     it--because of the casual manner in which the department 
     handled his access to top-secret materials and classified CIA 
     briefings, according to Commerce Department records and 
     extensive interviews.
       Commerce Department officials have described Huang as a 
     midlevel functionary cut off from policy action on Asia. But 
     they are unable to explain why he had almost weekly one-on-
     one briefings from a CIA officer on the latest intelligence 
     concerning China, Taiwan and Vietnam.
       What's more, a series of stunning security breaches at the 
     Commerce Department allowed Huang to get and maintain a top-
     secret clearance for 18 months, both before and after he 
     became a government employee--a period longer than the time 
     he actually served.
       Huang's security status was of keen interest to at least 
     one high-level Commerce Department official. Huang's boss 
     tried to ensure that Huang maintained his top-secret 
     clearance even after he left the department for the 
     Democratic National Committee.
       But when Huang--in a marked departure from previous 
     department practice--turned down an offer from his boss to be 
     upgraded to the government's highest security clearance, 
     Commerce Department officials showed strangely little 
     curiosity. An upgrade from ``top secret'' to ``sensitive 
     compartmented information,'' or ``codeword'' clearance, which 
     his two immediate predecessors had, would have required Huang 
     to undergo a much more detailed investigation of his ties to 
     foreign nationals, including his former employer, the 
     Jakarta-based Lippo Group.
       Former department officials and others now agree that 
     Huang's apparent reluctance to subject himself to the intense 
     scrutiny required for code-word clearance should have raised 
     questions.
       ``The ability to have access to information is the dividing 
     line between being an insider and outsider, the dividing line 
     between having informed judgment and not,'' said a former 
     senior Commerce Department officials. ``So for somebody to 
     decline it would have been a red flag.''
       Huang, who was let go by the Democratic National Committee 
     late last year after allegations surfaced about his 
     involvement in the campaign finance controversy, was 
     unavailable for comment. The Glendale resident's Washington 
     attorneys have said they ``have no doubt that he comported 
     himself honestly at the Commerce Department.''
       One of the lawyers, Ty Cobb, declined to comment on most 
     questions concerning Huang's security clearances and the 
     classified information he received at the Commerce 
     Department. Regarding the top-secret briefs, Cobb said: ``We 
     look forward, when circumstances permit, to clearing up the 
     confusion created on this issue by earlier press reports but 
     we aren't in a position to discuss it at this time.''


                       No Criminal Charges Filed

       Huang, a naturalized U.S. citizen, has not been charged 
     with any crime. And the Justice Department task force 
     investigating the campaign finance controversy and the 
     alleged covert scheme by the Chinese government to buy 
     political influence in the United States has not publicly 
     discussed its investigation of Huang.
       But the congressional committees investigating fund-raising 
     abuses are looking into how the Commerce Department handled 
     Huang's security clearances and his access to intelligence--
     and whether Huang exploited vulnerabilities in the 
     government's security-clearance procedures.
       The content of the intelligence briefings Huang received on 
     Taiwan, China and Vietnam could not be learned. But, in 
     general, he was in a position to glean internal government 
     information about U.S. trade practices, the business 
     practices of foreign competitors, links between foreign 
     governments and the private sector and corrupt business 
     practices in those countries. Such information could have 
     been of value to companies and individuals doing business in 
     or wanting to invest in the region, including Lippo, Huang's 
     previous employer.
       From the beginning, Commerce Department officials 
     considered Huang a ``White House hire'' steered to the 
     department because of his political connections. His former 
     bosses at Lippo--founder Mochtar Riady and his son, James--
     told acquaintances that they placed Huang at the department. 
     The Riadys, once part-owners of a bank in Little Rock, Ark., 
     had developed close ties to President Clinton when he was 
     governor of Arkansas.
       In January 1994, Huang was approved for the job of 
     principal deputy assistant secretary of commerce in the 
     international economic policy office.
       Although Huang did not plan to start until that July, the 
     department awarded him an ``interim top-secret'' security 
     clearance on Jan. 31, after a cursory one-day background 
     check by the Office of Personnel Management. Security checks 
     for permanent ``top-secret'' clearances normally take a month 
     or more.
       Commerce Department officials have defended Huang's interim 
     clearance, saying that he was expected to start his new job 
     quickly. But Huang's Feb. 28 personnel form indicated that 
     his start date was set for July 18, 1994.
       Officials stress that there is no evidence Huang attempted 
     to use his security clearance while he was still working for 
     Lippo in Los Angeles. They contend that his clearance 
     remained inactive until he arrived at the Commerce 
     Department.
       But several former senior department officials said they 
     found this troubling.
       ``That sort of stuns me,'' one said. ``At a minimum, it 
     sounds to me that [this is] a flaw in the process.''
       After Huang started work, the Commerce Department asked the 
     Office of Personnel Management to conduct a full-field 
     investigation of his background for a permanent top-secret 
     clearance.
       Personnel management officials said that they began the 
     background check in August 1994, looking at 10 years of 
     Huang's educational, professional and military records and 
     interviewing neighbors in cities where he had lived during 
     the previous five years. Finding no problems, final approval 
     was granted in October.
       But personnel management officials conceded that they did 
     not conduct an overseas investigation of Huang--even though 
     he had served in the Taiwan air force and spent much of his 
     career working for overseas-based employers. The regulations 
     did not require it, officials emphasized.
       After Huang began work at Commerce, his boss--Charles 
     Meissner, assistant secretary for international economic 
     policy--sought to have him upgraded to code-word clearance. 
     This would have given Huang access to the most sensitive 
     materials the U.S. government has on matters such as trade 
     negotiations with China, Taiwan and the rest of Asia.
       Meissner told John Dickerson, an intelligence liaison 
     officer at Commerce, that Huang needed the security upgrade 
     to do his job properly. Dickerson then told Huang he would 
     have to meet with the department's Office of Security, fill 
     out new paperwork and undergo additional scrutiny.
       Dickerson said through a Commerce Department spokeswoman 
     that he never heard from Huang again on the matter.
       Later, Meissner approached Robert Gallagher, Dickerson's 
     boss, and asked about the status of Huang's application for 
     code-word clearance, Gallagher said through the spokeswoman. 
     Gallagher said through the spokeswoman. Gallagher in turn 
     asked Huang if he had applied.
       Huang said he had not and again asked Gallagher what was 
     involved. When Gallagher told him it was more extensive 
     process than had been required for top-secret approval, Huang 
     declined to apply, Gallagher said.


                  Interviews With Foreigners Required

       Significantly, if Huang had applied, personnel management 
     officials would have interviewed foreign nationals with whom 
     he had been in business. Moreover, the entire background 
     investigation would have been sent to the CIA's Office of 
     Security, which could have demanded a more detailed 
     background check, agency officials said.
       ``The code-word application would have triggered a higher 
     level of scrutiny of any of his connections overseas, 
     including business ties with foreign nationals,'' said a 
     personnel management official.
       The security issues become starker given that Huang, who 
     had hoped to help shape the administration's international 
     economic policy, found himself largely cut out of the action 
     on Asia almost as soon as he arrived at the department.
       Part of the problem was that, before either Huang or his 
     boss arrived, Jeffrey E. Garten, chief of the International 
     Trade Administration, already had assigned others to handle 
     China and other large emerging markets. Garten also quickly 
     determined that Huang was not up to speed for such work.
       ``Garten had an A Team, and Huang wasn't even on the B 
     Team.'' said a Commerce Department official.
       As a result, Taiwan was the only Asian country Huang had in 
     his portfolio, and he accompanied Meissner there twice.
       Nevertheless, he became an active consumer of U.S. 
     intelligence on Asia. He received from a CIA officer 37 one-
     on-one, top-

[[Page E1255]]

     secret, Asia-related briefings--most concerning Taiwan or the 
     People's Republic of China--and he attended 109 meetings at 
     which classified intelligence information may have been 
     discussed, the Commerce Department acknowledges.
       Huang also received at least one previously undisclosed CIA 
     briefing on Vietnam that a senior Commerce official said he 
     could not explain because Huang ``had no policy role on 
     Vienam at all.'' Huang did not have to inform anyone about 
     the intelligence he got from the CIA, officials added.
       But Huang also had other access to classified materials. In 
     1994 and 1995, he attended 109 meetings at which classified 
     information may have been discussed. He also may have 
     received classified intelligence information at interagency 
     meetings at the White House, Commerce Department officials 
     said.
       Huang visited the White House 93 times during Clinton's 
     first term, Secret Service records show, seeing the president 
     15 times.
       Meanwhile, Huang maintained contact with his former 
     employer. According to his phone logs, he called Lippo Bank 
     in Los Angeles 70 times during his 17 months at Commerce. He 
     also placed 49 calls to C. Joseph Giroir, a Little Rock 
     attorney who works closely with the Riady family, records 
     show.
       On at least one occasion. Huang called Lippo the day he 
     received classified documents. The Lippo Group has extensive 
     financial interests in China and minor holdings in Taiwan, 
     and it has sought business opportunities in Vietnam.
       By mid-1995, a frustrated Huang wanted to leave the 
     Commerce Department. That Sept. 13, accompanied by James 
     Riady and Giroir, Huang told Clinton during an Oval Office 
     visit that he wanted to move to the Democratic National 
     Committee to raise money for the president's reelection 
     effort.
       Also present was senior White House advisor Bruce R. 
     Lindsay, who subsequently met with Huang before sending him 
     to Harold M. Ickes, the top White House aide overseeing the 
     campaign. Ickes notes show that they discussed whether the 
     administration might ``retain [Huang] as an unpaid 
     consultant'' when he moved to the national committee.
       Knowledgeable sources said that Huang requested the 
     consultant post but did not mention his desire to retain a 
     security clearance. Lanny J. Davis, a White House special 
     counsel, said that, `as far as Bruce Lindsay recalls, the 
     issue of Huang's consulting status or security clearance did 
     not come up in the White House and was not discussed between 
     him and anybody else at Commerce.''
       Nonetheless, by December 1995, as Huang was about to move 
     to his party job, Meissner tried to help him obtain a 
     consultant position. But Tim Hauser, a deputy undersecretary 
     for administration, rejected the request because he thought 
     it improper for a Democratic Party fund-raiser to be Commerce 
     consultant, department officials said.
       Meissner persisted, sources said, and tried to make an 
     ``end run'' by raising the issue with William Ginsberg, chief 
     of staff for then-Commerce Secretary Ronald H. Brown. 
     Ginsberg agreed with Hauser that the idea was ``politically 
     insensitive'' and asked Meissner why Huang wanted to remain a 
     Commerce consultant while working for the party, sources 
     familiar with the conversation said. One reason, Meissner 
     said, was so Huang could retain his security clearance.


                   Huang Kept His Security Clearance

       Meissner failed to get Huang a consulting contract. But, in 
     one of the saga's most curious chapters, Huang did get the 
     same top-secret security clearance given to the department's 
     contractors after Meissner had his secretary file the 
     paperwork.
       Without running a background check on Huang or confirming 
     that he had a consulting contract, the Pentagon's Defense 
     Industrial Security Clearance Office granted Huang a 
     ``consultant top-secret'' clearance on Dec. 12, 1995, a 
     spokeswoman for the office said. That was nine days after 
     Huang left the Commerce Department and a week after he 
     started at the national committee.
       The clearance remained in effect for a year--while Huang 
     raised millions of dollars for the Democratic Party--until 
     Dec. 9, 1996, when embarrassed Commerce officials discovered 
     it amid the fallout from the fund-raising controversy.
       Commerce officials described the episode as a bureaucratic 
     snafu and said they found no indications that Huang used his 
     clearance after he left the department--or that he knew he 
     had it.
       But Meissner's interest in helping Huang obtain a 
     contractor's security clearance remains a mystery. He died 
     along with Brown and 32 others in a plane crash in Croatia in 
     April 1996.
       ``Unfortunately, the people who were most involved in this 
     are not here now,'' observed Commerce Department Press 
     Secretary Maria Cardona.


[[Page E1256]]

                       SENATE COMMITTEE MEETINGS

  Title IV of Senate Resolution 4, agreed to by the Senate on February 
4, 1977, calls for establishment of a system for a computerized 
schedule of all meetings and hearings of Senate committees, 
subcommittees, joint committees, and committees of conference. This 
title requires all such committees to notify the Office of the Senate 
Daily Digest--designated by the Rules Committee--of the time, place, 
and purpose of the meetings, when scheduled, and any cancellations or 
changes in the meetings as they occur.
  As an additional procedure along with the computerization of this 
information, the Office of the Senate Daily Digest will prepare this 
information for printing in the Extensions of Remarks section of the 
Congressional Record on Monday and Wednesday of each week.
  Meetings scheduled for Sunday, June 1, 1997, may be found in the 
Daily Digest of today's Record.

                           MEETINGS SCHEDULED


                                JUNE 24
     9:30 a.m.
       Energy and Natural Resources
         To meet to further discuss proposals to advance the goals 
           of deregulation and competition in the electric power 
           industry.
                                                            SD-366
       Small Business
         To hold hearings on proposed legislation authorizing 
           funds for the Small Business Administration.
                                                           SR-428A
     10:00 a.m.
       Appropriations
         To hold hearings with the Committee on Governmental 
           Affairs on the implementation of the Government 
           Performance and Results Act.
                                                            SD-192
       Governmental Affairs
         To hold hearings with the Committee on Appropriations on 
           the implementation of the Government Performance and 
           Results Act.
                                                            SD-192
       Judiciary
         To hold hearings to examine the Rand report relating to 
           punitive damages in financial injury cases.
                                                            SD-226


                                JUNE 25
     9:30 a.m.
       Labor and Human Resources
         Business meeting, to consider pending calendar business.
                                                            SD-430
       Rules and Administration
         To hold hearings to examine campaign financing, focusing 
           on whether political contributions are voluntary.
                                                            SR-301
       Indian Affairs
         To hold oversight hearings on the Administration's 
           proposal to restructure Indian gaming fee assessments.
                                                            SD-562
     10:00 a.m.
       Appropriations
       District of Columbia Subcommittee
         To hold hearings on proposed budget estimates for fiscal 
           year 1998 for the District of Columbia.
                                                            SD-192
       Judiciary
         To hold hearings to examine encryption, key recovery, and 
           privacy protection in the information age.
                                                            SD-226


                                JUNE 26
     9:30 a.m.
       Energy and Natural Resources
       Forests and Public Land Management Subcommittee
         To hold hearings on S. 783, to increase the accessibility 
           of the Boundary Waters Canoe Area Wilderness.
                                                            SD-366
       Environment and Public Works
       Clean Air, Wetlands, Private Property, and Nuclear Safety 
           Subcommittee
         To hold oversight hearings on recent administrative 
           changes and judicial decisions relating to Section 404 
           of the Federal Water Pollution Control Act.
                                                            SD-406
       Labor and Human Resources
       Children and Families Subcommittee
         To hold oversight hearings on the implementation of the 
           Family and Medical Leave Act.
                                                            SD-430
     2:00 p.m.
       Energy and Natural Resources
       National Parks, Historic Preservation, and Recreation 
           Subcommittee
         To hold hearings on S. 308, to require the Secretary of 
           the Interior to conduct a study concerning grazing use 
           of certain land within and adjacent to Grand Teton 
           National Park, Wyoming, and to extend temporarily 
           certain grazing privileges, and S. 360, to require 
           adoption of a management plan for the Hells Canyon 
           National Recreation Area that allows appropriate use of 
           motorized and nonmotorized river craft in the 
           recreation area.
                                                            SD-366
       Judiciary
       Immigration Subcommittee
         To hold hearings on proposals to extend the Visa Waiver 
           Pilot Program, including S. 290, to establish a visa 
           waiver pilot program for nationals of Korea who are 
           traveling in tour groups to the United States.
                                                            SD-226


                                JULY 10
     2:00 p.m.
       Energy and Natural Resources
       National Parks, Historic Preservation, and Recreation 
           Subcommittee
         To hold oversight hearings to review the preliminary 
           findings of the General Accounting Office concerning a 
           study on the health, condition, and viability of the 
           range and wildlife populations in Yellowstone National 
           Park.
                                                            SD-366


                                JULY 23
     9:00 a.m.
       Finance
       International Trade Subcommittee
         To hold hearings with the Caucus on International 
           Narcotics Control on the threat to U.S. trade and 
           finance from drug trafficking and international 
           organized crime.
                                                            SD-215


                                JULY 30
     9:00 a.m.
       Finance
       International Trade Subcommittee
         To resume hearings with the Caucus on International 
           Narcotics Control on the threat to U.S. trade and 
           finance from drug trafficking and international 
           organized crime.
                                                            SD-215


                             CANCELLATIONS


                                 JUNE 5
     10:00 a.m.
       Commerce, Science, and Transportation
       Science, Technology, and Space Subcommittee
         To hold hearings on NASA's international space station 
           program.
                                                            SR-253
       Judiciary
         Business meeting, to consider pending calendar business.
                                                            SD-226


                             POSTPONEMENTS


                                JUNE 10
     10:00 a.m.
       Appropriations
       Defense Subcommittee
         To hold hearings on proposed budget estimates for fiscal 
           year 1998 for the Department of Defense.
                                                            SD-192
     2:00 p.m.
       Judiciary
       Technology, Terrorism, and Government Information 
           Subcommittee
         To hold hearings to examine instances of gambling over 
           the Internet.
                                                            SD-226


                                JUNE 12
     9:30 a.m.
       Environment and Public Works
       Clean Air, Wetlands, Private Property, and Nuclear Safety 
           Subcommittee
         To hold hearings on recent administrative and judicial 
           changes to Section 404 of the Federal Water Pollution 
           Control Act.
                                                            SD-406