February 18, 1998 – Bill Clinton signs waiver to send sensitive missile technology information to China, despite open Justice Department investigation and national security concerns

In Email/Dossier/Govt Corruption Investigations by Katie Weddington

“President Clinton gave the go-ahead in February to a U.S. company’s satellite launch in China despite staff concerns that granting such approval might be seen as letting the company “off the hook” in a Justice Department investigation of whether it previously provided unauthorized assistance to China’s ballistic missile program.

Documents released by the White House yesterday also show, however, that the State Department and other agencies had determined that the launch by Loral Space and Communications Ltd. was in “the national interest” and recommended approval.

This week, in an indication that the initial White House fears of criticism were well-founded, congressional Republicans cited the Justice Department warning in alleging Clinton jeopardized the nation’s security in granting a waiver. They suggested that the decision to do so was influenced by campaign contributions from Loral Chairman Bernard L. Schwartz.

Bill Clinton greets Loral chairman, Bernard Schwartz, in this undated photo. (Credit: The Associated Press)

The documents made available to reporters yesterday were handed over to Congress as the administration sought to buttress its contention that while Justice reservations were given due consideration, the decision to grant the waiver was made on its merits.

“These documents reflect the serious policymaking on national-interests grounds that goes into satellite waivers,” said White House spokesman Michael McCurry. “They also make clear that those who are taking political cheap shots should butt out.”

But the documents also demonstrated how Loral sought to use its connections to pressure the White House for a decision. Obtaining the required presidential approval was critical for Loral, which faced the loss of a hugely lucrative satellite sale and tens of millions of dollars in penalties if Clinton did not act before a contractual deadline with the Chinese. The company found significant support for its plight within the White House. Numerous officials there noted Loral’s financial interest in a speedy approval of the waiver.

The documents indicate that Schwartz, who has given more than $1 million to the Democratic Party since 1995, planned to raise the issue directly with National Security Adviser Samuel R. “Sandy” Berger at a state dinner for British Prime Minister Tony Blair on Feb. 5.

However, Loral Vice President Thomas Ross wrote to Berger a week later that Schwartz “missed you in the crowd” and was not able to make his case. Instead, Ross, who served as a senior National Security Council official earlier in the Clinton administration, pleaded in his Feb. 13 letter for speedy action by the president.

“If a decision is not forthcoming in the next day or so we stand to lose the contract,” Ross wrote. “In fact, even if the decision is favorable, we will lose substantial amounts of money with each passing day.”

Five days later, Clinton granted his approval, despite what Berger advised him were Justice concerns that the move “could have a significant adverse impact” on its ongoing criminal investigation. The Justice Department was looking into whether Loral illegally provided sensitive missile technology information to the Chinese following the 1996 crash of a Chinese rocket carrying a Loral satellite.

In making the documents available for reading at the White House late yesterday afternoon, the administration limited the number of reporters who could examine them and declined to make copies, citing concerns by White House counsel Charles F.C. Ruff that they were sensitive.

Special presidential waivers for satellite launches in China are required as part of the sanctions imposed on Beijing following the 1989 Tiananmen Square uprising. A total of 11 such waivers, covering 21 launches of U.S.-made satellites, have been granted — two by President Bush and nine by Clinton.

The House and Senate this week announced investigations into the the Loral waiver, as well as into the broader question of whether national security has been violated in sending U.S. high technology to China. (Read more: The Washington Post, 5/23/1998)  (Archive) (Further resource links)  (Archive)