“THE PEKING PENTAGON”

Excerpts

by Kenneth R. Timmerman
American Spectator , April 1996 edition

(Emphasis added throughout.)

Secretary of Defense William J. Perry had harsh words
for China’s leaders in a speech before Pentagon planners
at the National Defense University on February 13.
“Our policy accepts China at its word when it says
that it wants to become a responsible world power,”
Perry said. “But China sends quite the opposite
message when it conducts missile tests and large military
maneuvers off Taiwan, when it exports nuclear weapons
technology, or abuses human rights. It is time for China
to start sending the right messages.”

But Perry himself, and the policy of
“constructive engagement” he has championed for
the last three years, have abetted the
aggressive behavior China is pursuing today. By
encouraging technology exports to Peking that have
significantly aided the Chinese in modernizing their
military plants, and by turning a blind eye to Chinese
espionage and agents of influence in this country,
Secretary Perry has sent a message of his own: China
can continue to raid the cookie jar of U.S. high-tech
despite its bad behavior….

And now Perry is under scrutiny because of his
relationship to individuals and companies reaping
enormous profits from the policies he has
championed….Allegations center on a Perry associate,
John W. Lewis, whose Chicago-based company, SCM (now
called SC&M), has entered into a joint venture with a
Chinese entity controlled by the People’s Liberation
Army. In a letter to a senior State Department official
dated April 26, 1993, Lewis revealed that Perry
was backing [Lewis’] effort to sell advanced
telecommunications equipment to China despite the
clear understanding that export licenses “for this
and many similar projects would probably be denied”
on national security grounds.

***A career export control official…explained what has
happened: “This administration made a strategic
decision right at the start to eliminate export controls
as a means of growing exports.” [This has led to] an
astonishing array of high-tech exports to China. The
latest on the list: side-scan sonar, deep sea cameras,
remotely activated undersea manipulators, and special
deep diving lights, all capable of operating at depths of
12,000 feet. “This is a short list of what you need
to do deep sea mapping,” one Pentagon analyst said,
“so you can better hide ballistic missile submarines
in canyons on the ocean floor.” Under
Perry, The Pentagon has not only allowed these items to
be sold to China; it has encouraged the sales.

Bill Perry has benefited enormously from the
Pentagon’s “revolving door”….In February
1985, he founded H&Q Technology Partners, Inc., to
specialize in mergers and acquisitions as the shakeup of
the U.S. defense industry began….H&Q
subsequently became known as Technology Strategies and
Alliances, and continues to work with companies having a
major stake in Pentagon procurement policies. Indeed,
TS&A’s current chairman, retired Admiral David
Jeremiah, was appointed to the prestigious Defense Policy
Board last year.

***….In October 1994…[Perry] signed a ground-breaking
military cooperation agreement with Lt. Gen Ding Henggao,
chairman of COSTIND, China’s Commission of Science,
Technology and Industry for National Defense. COSTIND
reports directly to the Military Commission of the
Chinese Politburo, and has been identified by the
Defense Intelligence Agency as the “lead
agency” of China’s defense industrial complex.

….COSTIND also manages the effort to procure foreign
military and dual-use technology, either through
commercial deals (such as the one John Lewis is engaged
in) or through espionage….In other words, General Ding
is China’s top weapons scientist, and he commands China’s
best spies.

….[Perry helped to establish] the U.S.-China Defense
Conversion Commission in October 1994. The commission was
to receive a $50 million appropriation in this year’s
defense budget. If things had worked out as planned, one
of the first recipients of the funding would have been a
company run by John Lewis. Congressional
critics…are concerned that the commission has become
the vehicle for a dangerous giveaway of U.S. technology,
all in the name of “constructive engagement.”

….Perry’s coziness with the Chinese military has
been criticized before. Taking advantage of the summer
congressional recess, Perry arranged a discreet visit to
the Pentagon’s war room for Gen. Xu Huizi, the same
general who ordered the crackdown against pro-democracy
students in Tiananmen Square in 1989.

***Bill Perry has never believed that the U.S. government
should be in the business of controlling trade….Perry
put his convictions into practice within days of being
tapped to run day-to-day operations as deputy secretary
of defense in 1993. From being the lead agency in
restricting the sale of strategic technology to countries
such as China during the Reagan and Bush administrations,
Defense soon became the lead agency in making that same
technology available.

….Perry never attempted to disguise his views.
Indeed, at his confirmation hearing on February 24, 1993,
he said that trying to control the sale of dual-use
technology was “a hopeless task,” and that it
“only interferes with a company’s ability to succeed
internationally if we try to impose all sorts of controls
in that area.”

***As China turns up the heat in the Taiwan Straits and
blatantly ignores U.S. admonitions about its sales of
missile and nuclear technologies to countries such as
Iran, many observers are beginning to wonder whether Bill
Perry’s long-standing relationships with COSTIND and the
People’s Liberation Army may have clouded his view. For
James Lilley, a former ambassador to Peking, the Chinese
“have understood that their real friend in this
administration is Bill Perry,” and have been using
him to gain access to advanced technology.

***[Many believe that] three years of constructive
engagement with China, coupled to the Clinton
administration’s consistent refusal to enact any
meaningful sanctions when the Chinese break their
commitments to the U.S., may have emboldened the Chinese
leadership to the point of military aggression.
“Perry argues that engagement is not
appeasement,” says congressional aide William
Triplett. “If the Chinese have gotten the idea that
it is appeasement, it is largely Perry’s fault.”