In July, 1998, President Clinton threatened to veto the U.S.
Defense bill pending before Congress because it will remove
satellite export authority from the Commerce Department.
Congress paid little heed to Clinton and continued to include
the transfer of export authority back to the State and Defense
Departments. The provision is expected to pass with a veto-
proof margin of Democrats and Republicans.

Clinton’s recent defeat in Congress has also led to his defeat
in U.S. domestic politics. The President opposes giving the
same level of secure communications to American citizens that he
sold to our new strategic ally, Red China. Many Americans think
this is because Clinton trusts Jiang Zemin more than any U.S.
citizen. Americans, unlike the Chinese Army, could use the
technology to protect their personal privacy.

One key item that appears over and over again is the breach of
U.S. encryption systems by China. Bill Clinton clearly placed
himself between the buyer (China) and the seller (Loral) by
using Presidential waivers — much like a (Whitewater) real
estate broker. Both sides paid well to obtain his signature and
the President graciously provided it. Clinton’s actions
certainly raises the question — does the Chinese Army deserve
more privacy than a U.S. taxpayer?

To demonstrate how bad the situation is — I could write in this
article ten lines of “crypto” computer code that would instantly
put me in jail. Violation of Free Speech? Not to Bill Clinton.
The administration considers such an act an illegal export of a
weapon and it is a felony. In fact in 1995, at the same time
Clinton was approving exports of strong (unbreakable) encryption
to China, Janet Reno had a grand jury investigating software
author Phil Zimmermann, claiming he had posted the source code
for his encryption program PGP to the internet.

Yet, strong encryption software is freely available all over the
Internet. Such mass market software has zero military value
when compared to the radiation hardened crypto chips in Chinese
hands. I can protect my credit card with the PC software but
code chips that can bake in gamma rays are a military item.

In a recent interview, William Reinsch, the head of the Commerce
Bureau of Export Administration, excused these actions as
“exceptions” and he asserted that “policy should not be based on
exceptions.” However, it would seem that not only was the
Clinton policy based on exceptions — Clinton’s re-election
campaign depended on them financially.

Moreover, Clinton’s absurd crypto policy was the subject of a
secret meeting in May 1996 between Janet Reno, FBI Director
Freeh and CIA Director Deutch. The meeting is outlined in a
Commerce briefing document obtained using the Freedom of
Information Act.

“Export controls on encryption have been a long-standing issue
for exporters, the intelligence community (NSA), and domestic
law enforcement,” states the Commerce document. “Efforts to
maintain tight controls on encryption in the ‘Internet age’ lack
credibility, threaten to impose real costs on U.S. industry and
its competitiveness, and are becoming a political embarrassment
for the Administration.”

Furthermore, this document demonstrates how deep Janet Reno is
in this affair (e.g. the 1996 encryption export policy meeting
took place in her office). Reno is clearly in conflict of
interest with the Chinese Army penetration of the White House.
She helped write and approve the policy that blocked her own
Justice Department investigation of Loral. A REAL investigation
would have to ask Reno some official questions.

“Janet Reno and Louis Freeh are deeply concerned about the
spread of encryption,” states the 1996 briefing paper.
“Pervasive use of encryption destroys the effectiveness of
wiretapping, which supplies much of the evidence used by FBI and
Justice. … The Vice President chairs the senior group that set
the Administration’s encryption policy; since February, 1994, it
has been supported by a working level group co-chaired by NSC
and OMB, composed of NSA, CIA, FBI, State, Commerce (BXA, NIST),
and Justice.”

Thus, while Reno and Louie Freeh were chasing ghosts on the
Internet, President Clinton authorized the military version to
be exported to China in July of 1996. Ironically, even law
enforcement knew of the futility in the domestic software

“Last summer, the Vice President agreed to explore public
acceptance of a key escrow policy but did not rule out other
approaches, although none seem viable at this point,” states the
document. “Lost in the debate, but not irrelevant is the fact
that it is virtually impossible to enforce export controls
against them (encryption programs) when they can be exported by
phone and modem or in someone’s pocket.”

Another losing domestic issue is that companies, such as Loral,
contributed to the demise of U.S. rocket science by pushing for
more Chinese and Russian launches. One document from Loral is a
1994 brief for Ron Brown obtained by the Freedom of Information
Act labeled simply “Secy. Brown Mgt.”

“U.S. satellites lead the world — launch vehicles have lost out
to European ‘Ariane’,” notes the Loral document for Ron Brown.
“Trade deals need to prevent ‘dumping’ of Russian, Chinese
rockets. STILL, U.S. will lose out to France/Europe until some
bold new rocket is developed — may be unaffordable, require
international cooperation (like giant Boeing airliner).
Continued U.S. leadership in satellites may depend on occasional
use of Russian or Chinese rockets. Europeans will fight this.”

Ironically, as far back as 1990, Loral and Intelsat engineers
had OPPOSED the launch of satellites on Chinese rockets because
of serious safety concerns. They were over-ruled by management
because of cheap Chinese prices. In fact, as late as 1995,
technicians repeatedly identified serious violations that
jeopardized the chance of a successful launch. Their warning
went unheeded.

The Clinton shift in policy from our industry and our Western
allies to communist China did not go unnoticed. Congress is
indeed interested and has demanded the White House, Loral,
Hughes and Motorola turn over all documents. The White House,
Hughes, Loral and Motorola have resisted but seem to forget the
example set by tobacco companies; lying before Congress brought
swift reaction and subpoenas.

For example, Congressman Dana Rohrabacher (R-CA), Chairman of
the powerful House Aeronautics and Space subcommittee wrote
Motorola in July and made it clear — it’s time to come clean.

“The message I have received from your reply to my specific
inquiry was nothing less than ‘buzz off’,” wrote Rohrabacher to
Motorola. “Your letter and the answer is unacceptable.”

“After only two months of open discussions and hearings into the
Chinese missile upgrade scandal, a disturbing picture is
emerging,” states Rohrabacher’s letter to Motorola. “It does not
look good for Motorola at this moment, but further information
could clarify the situation. Your letter indicated you might be
helping me clarify that picture. However, I do not believe that
your ‘too much overlap’ (stall) position does me much good, and
I can assure you, it will do you no good as well.”

To the average public this may seem like a food fight. Military
pilots and the armed forces see this as a matter of life and
death. To California and Texas space engineers it was certainly
a living. One big U.S. loser was Texas-based General Dynamics.
General Dynamics, maker of the Atlas rocket that put Astronaut
John Glenn in space, sold out to defense giant Lockheed because
they were unable to compete against the cheap (exploding)
rockets from China.

This fall Senator John Glenn (D-OH) will test the “Tang” version
of Geritol in space as a reward for covering Clinton during the
1997 tactical retreat/Senate hearings. Glenn will be put into
orbit on another grand-dad of the space race, the aging U.S.
Space Shuttle, which cannot match the price of throw-away
Chinese rockets. So much for the “right stuff.”

What new manned space or military missile project has Clinton
proposed since taking office? Zero. Nada. Nothing. Not even
Gene Roddenberry would give this President a passing grade.

One thing is certain, Clinton is no JFK. Kennedy recognized in
1960 we were a second rate space power and he addressed it with
the most ambitious projects in human history. Minuteman,
Polaris, Titan, Poseidon and Trident were all included with
Mercury, Gemini and Apollo, not to mention a hundred other
aerospace programs.

Clinton has addressed our current second-rate space program with
waivers, cover-ups, delays, cancellations and excuses.
President Clinton has spent more time on the threat Monica
Lewinsky poses to his Presidency than the nuclear missile threat
to America. In fact, the newest missile in the aging U.S.
nuclear strike fleet dates to the Carter administration.

Clinton-space on the cheap also has a price. It is reflected in
performance, safety and lives. One wonders how long Loral would
have lasted in court if a U.S. rocket had fallen on 200 innocent
civilians in America. Yet, leadership — being a first rate
world power — too has a price.

Clinton has abandoned the U.S. space launch program. For
example, Lockheed has President Clinton’s approval to buy
Russian-built rockets instead of developing new engines. Of
course, one of the Russian rockets failed recently, carrying a
spy satellite. Lockheed has an economic stake in the Russian
engines so they had to help out or lose money. Thus, Lockheed
engineers helped the Russians diagnose the error and fix the
problem. Since then, Russia has been able to orbit a whole new
series of spy satellites thanks to Lockheed and Bill Clinton.

In addition, China and Russia are rapidly modernizing their
nuclear strike forces with a whole new series of road-mobile
ballistic missiles developed during the Clinton administration.
These world-class SCUDs can hide under a bridge, destroy a major
city and reload to fire again in under an hour. Furthermore,
Chinese missile accuracy has improved to the point where
Congress can literally say there is a nuclear bullet with their
name written on it.

China and Russia are also selling loads of missile technology to
Iran, Pakistan and Syria. The Russian space agency (RSA), our
U.S. taxpayer-supported partner in the International Space
Station, was caught selling missile components to Iran in May of
1998. President Clinton did nothing to stop the sale. In fact,
he continues to oppose a ban on further U.S. money for the
Russian space agency until they clean up their act.

The Russians, meanwhile, complained that the operation which
uncovered the high-tech export was a U.S. sting. Furthermore,
as sort of a “in-your-face” gesture, the Russian nuclear
ministry (MINATOM) has announced it will sell tritium gas and
gaseous diffusion technology to Iran. Thus, we have a nuclear
tipped Ayatollah thanks to those friendly folks who brought you

In November, 1941, U.S. companies successfully lobbied the
Roosevelt administration to continue oil and scrap iron exports
to Imperial Japan. After all, argued the American companies,
Japan would never attack America. On December 7, 1941, the
Japanese fleet used that same U.S. oil and scrap iron to sink
nine Navy battleships at Pearl Harbor.

In 1998, President Clinton did not include Hawaii, Pearl Harbor
or even Alaska as part of the United States in his evaluation of
the foreign missile threat to America. After all, China would
never attack America.


Reno, Freeh, Deutch May 1996 meeting –

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July 1998 Rep. Dana Rohrabacher, Motorola, Hughes Letters

Secy. Brown Mgt. LORAL

JPEG/GIF and Text

OXFORD UNIVERSITY UK WEB SITE where crypto source programs are

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