Did President Clinton allow China and Russia to buy U.S.
supercomputers, knowing they would be used for military purposes?
According to the General Accounting Office, the answer is yes.

The GAO recently released a scathing report critical of President
Clinton’s high-tech export policy. According to the GAO, “the
President’s July 1999 report to Congress did not fully satisfy the
reporting requirements of the Defense Authorization act.”

Overall, only 3 percent of all computer licenses were for “sensitive”
end-users such as foreign military units. The GAO noted that the
Clinton administration issued over 1,900 licenses for high-speed
computers to communist China between November 1997 and August 1999. Of
the 1,924 computers licensed for China, 48 computers were to “sensitive
end-users or uses,” or nearly 2.5 percent of all sales to China.

In contrast, India, which recently surprised the world with a series
of secret nuclear tests, received only 113 computers. However, 79 of the
113 computers sent to India were to “sensitive end-users” — nearly 70
percent of all high-speed computer sales to the nation.

High-speed computer exports are under the control of the U.S.
Commerce Department, which claims that it is engaged in only “civilian”
and commercial operations. This claim is false. U.S. Commerce
documents provided by the Federal Aviation Administration (FAA) show
that Commerce officials hosted Chinese Army officers for the sole
purpose of providing military training and exports, including high-speed
computers that could be used for air defenses.

President Clinton’s report on computer exports acknowledged there are
direct military applications, including nuclear weapons development.
However, Clinton dodged the export issue by simply not commenting on the
national security impact of his decision to allow such sales to military
end-users. According to President Clinton, the money from foreign
military users is more important than if foreign militaries use the
American computers to wage war.

“The (president’s) report did address two of the three requirements
to determine the availability of high performance computers in foreign
countries and the potential use of the newly decontrolled computers for
significant military use,” wrote the GAO. “These applications include
advanced aircraft design, anti-submarine warfare sensor development, and
radar applications.”

“(The president’s report) did not, however, assess the impact of such
military use on the national security interests of the United States,”
wrote the GAO. “Instead, the report discussed the economic importance
of a strong U.S. computer industry to U.S. national security. The
President’s report concluded that failure to adjust U.S. export
requirements for computers and processors would have a significant
negative effect on the U.S. computer industry.”

“The (president’s) report implied that high performance computers are
readily available for foreign sources,” states the GAO. “A 1998 study
sponsored by DOD (Department of Defense) and Commerce found that the
United States dominates the international computer market.”

There is ample evidence to support the GAO, proving that Russia and
China prefer U.S. super-computers. For example, the following items
were documented in the U.S. House Select Committee Report (Cox report)
issued Jan. 3, 1999:

  • On July 31, 1998, the Department of Commerce announced that
    IBM entered a guilty plea for the illegal export of a supercomputer to
    Russia. IBM received the maximum allowable fine of $8.5 million for 17
    counts of violating U.S. export laws through the sale of a supercomputer
    to a Russian nuclear weapons laboratory known as Arzamas-16. The
    Clinton administration has decided to allow Arzamas-16 to keep the IBM

  • On April 18, 1997, the Commerce Department imposed a $55,000
    civil penalty on Compaq Computer Corporation of Houston, Texas, for
    alleged violations of the Export Administration Regulations. The
    Commerce Department alleged that, on three separate occasions between
    Sept. 17, 1992, and June 11, 1993, Compaq exported computer equipment
    from the United States to several countries, including China, without
    obtaining required export licenses. Compaq agreed to pay the civil
    penalty to settle the allegations.

Another prime example occurred on Dec. 26, 1996, when a Hong
Kong reseller for Sun Microsystems, Automated Systems Ltd., sold a
supercomputer to the Chinese Scientific Institute, a technical institute
under the Chinese Academy of Sciences — a State laboratory specializing
in parallel and distributed processing. At some point after the sale —
but before delivery — the computer was sold to the Yuanwang

Yuanwang is an entity of the Chinese army unit COSTIND (Commission on
Science, Technology, and Industry for National Defense). According to
the Chinese Foreign Ministry, Sun Microsystems had been aware of this
corporation’s Chinese military ties. The supercomputer sale came to the
attention of the Commerce Department’s Deputy Assistant Secretary for
Export Enforcement Frank Deliberti. Deliberti gave the information he
obtained to Sun Microsystems, which then initiated efforts to have its
computer returned. The computer was returned to the United States on
Nov. 6, 1997.

Yet, according to the Commerce Department’s own documents the
meetings with Chinese army-owned companies took place prior to
documented transfer to Yuanwang Corp. The documents include a list of
Chinese military officials compiled by Commerce including People’s
Liberation Army (PLA) Gens. Ding and Huai.

On April 6, 1994, an unclassified memo was sent from Defense
Intelligence Agency (DIA) official Col. Blasko to Commerce officials
Deliberti, Albanse and Isbell. The memo states that “Yuanwang”
Corporation and “Great Wall Industries” are “significant to the Defense
conversion” along with other known PLA owned firms such as “China
National Nuclear” and “China North” Norinco.

In 1995, Commerce official Barry Carter sent a letter with
attachments to Eden Woon “Executive Director” of the Washington State
China Relations Council. Carter included with his letter a Feb. 25,
1995, letter from Chinese Gen. Ding, complete with military contacts for
business. Included in the list given to Eden Woon was “Yuanwang Corp”
— the PLA owned company responsible for the illegal Sun computer
transfer in 1996.

However, the GAO report is minor in comparison to another upcoming
event facing the Clinton administration. In 1998, this reporter filed
suit to force the Clinton administration to release the true documents
showing how the supercomputers were exported to Russian and Chinese
weapons labs. In December 1999, Commerce will go to court and face a
federal judge in reference to the U.S. companies involved in the illegal
computer transfers to China and Russia.

The evidence is stacked against the Commerce Department. One
document previously forced from the agency by legal action is from the
largest U.S. computer lobby group, the Computer Systems Policy Project
(CSPP). The document shows that CSPP members such as IBM, Sun, and
Compaq, sought Commerce officials to approve transfers of computers to
military end-users in Russia and China in 1995.

In response to the lawsuit, on Nov. 15, 1999, Commerce provided an
index of all documents withheld for the CSPP members as part of the
upcoming trial. Commerce claims to have completed a full search for all
responsive CSPP documents and has accounted for all materials that
cannot be made public in the “Vaughn” index. In fact, Commerce
officials also submitted under oath that they could find no more
documents and that all materials have been accounted for the federal

This too is false. This reporter has acquired two CSPP documents
that were not accounted for by the Commerce Department. The
first document is a July 14, 1998, letter to Mr. Christopher Kearns at
Bankers Trust from Commerce Department FOIA officer Bobbie Parson in
reference to a FOIA “request from Softwar for documents relating to
Computer Systems Policy Project.”

The letter includes an attachment from Bankers Trust that concerns
export policy of encryption technology, noting that the huge banking
corporation had already “accommodated” the Clinton administration’s
demands. The requirements, according to government documents, were to
have a secret “back-door” installed in all bank computers, allowing the
federal government to monitor electronic transfers without a warrant.

“Since the government has already approved the export of one
conditional access encryption system (clipper),” states the Bankers
Trust memo. “BT Believes it will be difficult — and contrary to the
interests of law enforcement — to restrict export of other conditional
access encryption products. … BT’s system design accommodates the
possibility that it will be adopted.”

The second document is an Aug. 19, 1998 letter to Charlotte Knepper
at the National Security Council from Philip J. Greene, U.S. Commerce
Office of the Chief Counsel for Technology in reference to a FOIA
request from Softwar for documents relating to CSPP. The letter
includes two attachments, an e-mail from Commerce Undersecretary Dave
Barram dated Jan. 3, 1996, and a copy of the Softwar FOIA request for
“Computer Systems Policy Project.”

According to Undersecretary Barram, “Terrorist activity” was of no
concern to the corporate members of the CSPP. “They aren’t likely to
think the risk society avoids for however long, offsets the economic
risk to American industry.”

Unsaid in the memo is the fact that David Barram, former CEO of Cray
Corp., then the leading Super-Computer maker in America, was also a
former member of the CSPP.

In 1996, President Clinton changed the law and allowed advanced U.S.
computer technology to be sold to foreign military users. Clearly, in
1996 the CSPP export policy became Clinton’s export policy.

The economic impact (money) of losing 3 percent of total sales is by
far more important to this president and his big business backers than
U.S. national security. As a result, nuclear weapons designed and built
using American supercomputers are now being deployed. These new weapons
threaten all human life on Earth with the “risk” of extinction. We can
only thank the CSPP and Bill Clinton for taking such a risk with our
lives over something as important as money.

Source documents

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