Tag Archives: Freedom Flame

2004 Freedom Flame Award: Lawrence and Susan Kadish

Susan and Lawrence Kadish
Susan and Lawrence Kadish

On June 14, 2004, General James L. Jones, Supreme Allied Commander, Europe and Commander of the United States European Command, was the featured speaker on the occasion of the presentation of the Freedom Flame Award to Lawrence and Susan Kadish in recognition of their immense contribution to the cause of American freedom, and most especially the work of the Center.

In addition to his contributions to the Center for Security Policy, Mr. Kadish has served as the founding chairman of the Republican Jewish Coalition, a senior adviser to Americans for Victory over Terrorism (AVOT), and served on the boards of both the Claremont Institute and the Hudson Institute.

2002 Freedom Flame Award: Fred Thompson

2007_09_fredthompsonOn December 12, 2002 the Center paid tribute to a most deserving and patriotic American, Senator Fred Thompson by presenting him with the 2002 Freedom Flame Award.

We at the Center have been admirers of Senator Thompson during his entire service in the Congress. It is with real regret that we see him leaving the Senate, because he has distinguished himself in a variety of capacities in the Senate as a leader, as a man of vision, and as a true worthy recipient of a distinction like the Freedom Flame.

Not least, we’d like to call special attention to the really thankless but tremendously important work that Senator Thompson has done in his Senate career in helping the American people understand the serious potential problem we face with Communist China, the danger of proliferation of weapons of mass destruction, and the role that unfortunately we in the West and even we here in the United States have been playing in both, through our inattention to the need to exercise sensible prudential controls over sensitive technologies.

And it is really no exaggeration to say this is a thankless task; in fact, it is a task that has earned people like Senator Thompson and Senator Kyl, Senator Helms, Senator Shelby, and others who have worked with them on the Export Administration Act reauthorization, we are sure no end of grief from those who believe, even in this era of global war against people who clearly are bent on using whatever means they can to inflict harm upon us. But nonetheless the right answer here is just sell whatever we can sell to whomever we can sell it to.

Throughout the Center’s 15 years of existence it has been an issue of considerable interest for us to find leaders who have held high office and who have used that office to try to ensure that these sorts of tough political calls are given the attention they deserve.  This would in and of itself justify the tribute we pay to Senator Thompson today.

 

TRANSCRIPT

The 2002 ‘Freedom Flame’ Award Dinner in Honor of Senator Fred Thompson

Frank Gaffney: To this tribute to a most deserving and patriotic American, which is also passing frankly for our Christmas party. So I won’t mind if we try to get a twofer out of this.

I’m going to do something that’s a little bit of a departure from normal practice. I think it actually will very much work to all of our benefits. But we’re going to accelerate the program and ask you, while you eat, to cock an ear towards the podium. Because unfortunately, our dear friend, Senator Kyl, who graciously rearranged his travel schedule to accommodate us, has been afflicted with what I guess is Potomac fever from his extended exposure to the Washington Capital Area, and is feeling under the weather.

So after a few introductory remarks by me, I’m going to ask him to make a few introductory remarks, and then we’re going to release him and ask Senator Thompson to come up and speak to us, at whatever length he cares to, and then he has graciously agreed to take some questions from our distinguished company.

I would just like to, in addition to saying these words of welcome to you, give you a little bit of background on why we are here. We at the Center have been admirers of Senator Thompson for his entire service in the Congress, and for that matter his service on the silver screen, as well. It is with real regret that we see him taking this road now back to pretty much I imagine full-time on the silver screen, or at least the smaller one, and leaving behind his period of government service, because he has distinguished himself in a variety of capacities in the Senate as a leader, as a man of vision, and as a true worthy recipient of a distinction like the Freedom Flame.

Not least, I think, and Senator Kyl who has collaborated with him closely on many of these fronts, I’d like to call special attention to the really thankless but tremendously important work that Senator Thompson has done in his Senate career in helping the American people understand the serious potential problem we face with Communist China, the danger of proliferation of weapons of mass destruction, and the role that unfortunately we in the West and even we here in the United States have been playing in both, through our inattention to the need to exercise sensible prudential controls over sensitive technologies.

And it is really no exaggeration to say this is a thankless task; in fact, it is a task that has earned people like Senator Thompson and Senator Kyl, Senator Helms, Senator Shelby, and others who have worked with them on the Export Administration Act reauthorization, I’m sure no end of grief from those who believe, even in this era of global war against people who clearly are bent on using whatever means they can to inflict harm upon us. But nonetheless the right answer here is just sell whatever we can sell to whomever we can sell it to.

So I just wanted to say, in particular, because this is an issue of very considerable interest to the Center throughout its 15 years of existence to find leaders who have held high office and who have used that office to try to ensure that these sorts of tough political calls are given the attention they deserve, would in and of itself, I think, justify the tribute we pay to Senator Thompson today.

But there’s a great deal more, and at this point, if he’s still up to it, I would like to ask Senator Kyl to come and say a few words. And let me just say, before he stands, how much I appreciate your rearranging your schedule, John, and as always responding to our requests that you participate in the Center events, and by so doing, add to much to their quality. Senator Kyl.

[Applause.]

SENATOR KYL: Thank you.

First of all, I really don’t like this set-up here, so I’m going to do this. Secondly, Fred and I have used a lot of excuses in our day not to have to hang around for the whole luncheon, but I’ve never used the George Bush at the Chinese Banquet excuse before. I just hope that my concern doesn’t come to pass here, and I can get through this before I embarrass myself.

I did want to be here, notwithstanding not feeling very well, because there aren’t very many of us here who could say some of the things that I really want to say about Fred today. And that should not make him feel particularly comfortable at the moment, I might add.

I have learned that you just can’t introduce people as “The person who needs no introduction.” I tried that at a much more intimate dinner one night in New York about two years ago with Dr. Kissinger. And he immediately I think stood in place. I’ve forgotten. And said, “Well, it is true that I need no introduction, but no one enjoys one more than I do.”

And I don’t want to suggest that Fred enjoys the comments that we have to make as he does leave the public service that he’s engaged in during his time in the United States Senate, but I do think it’s important that some of us achieve just a little bit better understanding of what Fred Thompson really meant to the United States Senate and to the United States of America. And I frankly don’t think that that message has been quite adequately conveyed.

The Strom Thurmond retirement has kind of overshadowed the retirement of Phil Gramm, of Jesse Helms, of Fred Thompson. And all in their own right deserve a tremendous amount of recognition for not only the commitment that they’ve made throughout the years to serve the United States, but the way in which they did it, adhering to their principles. And that’s what I really wanted to talk a little bit about here, with Fred Thompson.

Frankly, if we’d elected Fred Thompson President, we wouldn’t be having all the problems we have today

[Laughter and Applause.]

Now, let me explain what I mean by that.

[Laughter.]

And start to dig a really deep hole. Look, you all know what Fred has done in his career, and that’s not really what I’m going to talk about here. I’m want to start out by talking about when I first got to know Fred well, he and I sat together on the judiciary committee. And if you’ve attended those meetings, you know why I soon relished the chance to hear Fred’s latest.

To say he is cynical and a smart you-know-what would be to sort of understate it. He’s got a great sense of humor. He doesn’t suffer fools lightly. He doesn’t mind expressing himself soto voce frequently in that committee meeting. And so it was great fun and great sport to hear the running commentary from Fred, making fun of whoever it was that was making a fool of themselves during the committee process. Usually this was when we were in executive session and it was senators only who were speaking, I might add.

But I appreciated Fred’s smart-alec humor and cynicism, but I didn’t really quite understand at the very beginning the depth of commitment and principal that Fred Thompson, in fact, possesses, and that’s what I really want to talk about here. I began to learn that Fred Thompson is a man of enormous principle, of great instinct, and extraordinary commitment to national security.

I want to explain what I mean by all of those. He is very principled, but he pulls it off because of his rather light-hearted way of sometimes appearing in public. He is so principled, in fact, that he even cajoled me one time, because of his firm belief in federalism and the distinction between the federal government’s responsibilities and the state’s, to vote against federal funding for cops’ bullet-proof vests. I did that once.

[Laughter.]

But that’s the kind of thing that Fred is willing to do, and he never wavered. Now, maybe that’s why he didn’t to run for reelection. I don’t know. But the truth of the matter is, time after time, that’s a humorous example of it. But time after time Fred said “I don’t care.” This is what’s right, and this is what I’m going to say, do, or this is the way I’m going to vote.” And I don’t think that’s fully enough appreciated in Washington.

His instincts, his instincts about things like the China investigation, which he participated in and Frank alluded to. Right on target. His instincts on national security matters generally. He never bought off on the stuff that you know came to be the series of excuses for the behavior, the rationale for non-U.S. action in certain situations. In fact, he actually became a leader in one of the efforts that succeeded, when another great American, Henry Hyde, said to a high administration official, “No, I will not release the Export Administration Act, so that you guys can trade away any technology you want to to anybody in the world.”

It was Fred who really helped us to understand why we needed to be smarter about the way that we authorized the Export Administration Act, and pay more attention to the national security implications of it, pointing out, for example, that the Communist government of China had in effect enlisted American businessmen as their lobbyist, as the Chinese government’s lobbyist, to open up technology transfer to China, and lobbyist for other of its agendas, by dangling the prospect of doing business in China for these folks, if they would only prove their bonafides by coming back to the Congress and lobbying the Communist Chinese government’s case to us. And that happened to me on numerous occasions.

Well, Fred had the courage to point that out to people, and said, “Don’t you understand what these people are doing and why they’re doing it?” And he and Senator McCain, Warner, Helms, and Shelby and I basically did everything we could to try to rewrite that EAA in a way that made some sense, not only to promote Congress as we want to promote it, but also to secure our legitimate national security interests. And again, thank goodness the bill was held in the House, and hopefully we’ll have an opportunity to rewrite that.

But I doubt that any of you were aware of the role that he played in that particular contest, and the way that he inspired some of the rest of us to hang in there, and by the way, the way that helped with his staff to give us what we needed in order to fight that battle. This is the Fred Thompson I know, who is very concerned about our intelligence community, and I urged him, I said, “Try to get on the Intelligence Committee. You would do a great job on that.” And we finally succeeded. Fred got to a member of the committee.

Unfortunately, I think from his perspective, he came to find out the same thing which I had figured out, which was that we have a real problem, both with the oversight process, which does not work, and with our intelligence community, which has a lot of cultural problems. And he became as frustrated, frankly, as I was. But this is where his great humor, combined with his cynicism, played very, very well, I might add. My point in this, and I’m not going to go on any longer here, is that there is a lot about Fred Thompson that I don’t think people really appreciate, because they know him as someone who can be an actor, and who can take the stage and command presence, and so on. And I don’t people appreciate the behind-the-scenes work that he has done, the amount of work that he’s put in on these things, and the great instincts that he’s brought to the battles.

When Fred Thompson spoke at our conference, people listened. And he carried everything, as you know, from the Chinese investigation at the very beginning of his career, to the Homeland Security Department, the last thing we did. I don’t know, it was the next, I guess the penultimate vote that we cast in this last session. And that was Fred Thompson again.

So for those who are interested in national security, and that represents everybody here in this room, and I thank all of you for your continued support for us in our endeavors, you need to appreciate and help others appreciate the role that my great friend and colleague, Fred Thompson, has played on national security issues in the United States Senate.

It is a real personal pleasure for me to introduce him to you today, and an honor, and I might say a personal pleasure for me to call him I hope a life-long friend, someone that we’ll be able to spend some time with, notwithstanding his other obligations, but to spend a lot of time with. Because frankly, Fred, we’re going to be able to use your good counsel in the years to come, and I hope that we’ll be able to count on you in providing that to us.

My good friend, Senator Fred Thompson.

[Applause.]

Frank Gaffney: This is entirely appropriate, not only because of the friendship between these two men, but because after all Senator Kyl is a keeper of the flame, as honored by him in ’94 by the Center for Security Policy, and it is a privilege to have him passing the torch on this occasion. The citation that goes with the Freedom Flame reads as follows:

“The Freedom Flame award recognizes individuals who have exemplified the ideals of freedom, democracy, economic opportunity, and international strength, to which the Center for Security Policy is committed. The award acknowledges the past contributions of its recipients while serving as a reminder that the goals for which they have worked so valiantly require the continuing unflagging efforts of those who follow in their footsteps.”

Congratulations, Senator.

[Applause.]

Frank Gaffney: Well, don’t go away, Senator. That’s it, yes, he’s out. Come on up here, if you would please. Do you mind using the podium? Do you want to use the podium?

SENATOR THOMPSON: Yes, I think so.

Well, I know that Kyl got tired of listening to me, but I never thought just the thought of listening to another speech from me would make him sick.

[Laughter.]

We sit next to each other on the Senate floor, and I was going to say when he was here that with me leaving, I don’t where in the world he’s going to get his good ideas now.

[Laughter.]

But with him gone, I can just tell you that what you just saw is what you get with John. John is one of the true keepers of the flame, and for that reason one of the most important members of the United States Senate, and I look forward to following his career with great interest.

Frank, thank you very, very much for your kind comments. In fact, I’m not gone forever. My little job that you refer to is only going to take a couple of days a week, so I plan to be around quite a bit and doing various other things. I must say, though, that after watching Martin Sheen and the rest of the troop weigh in on these national security issues, that I’m looking forward to getting back into that business, so people will take my views seriously again, on–

[Applause.]

It’s a funny world we live in, isn’t it?

[Laughter.]

This is a special occasion for me, and as you know, you’re supposed to continue right ahead, and this is a little bit unusual and unorthodox, but I think that this is exactly the thing to do in the interest of time. And we will work through it. And I just appreciate your coming and allowing somebody who’s followed the issues that we’re all interested in pretty closely for eight years, to give me a chance to spout off a little bit, as I leave the United States Senate, and make a couple of comments, based upon close observation, and doing what I consider to be the number one job of a United States senator. And that is looking out for the interests that pertain to our national security.

But it’s not only a wonderful occasion for me, because of this great award that I’ve received, as so many great Americans and non-Americans have received. But it gives me a change to thank the Center for Security Policy, as well as many others in this room, for doing what you’ve done for the security of our country. Issues concerning national security are in the forefront of everyone’s thoughts right now, but unfortunately it took September 11th to make it so.

In May of 1999 a CNN gallop USA Today pole on “What do you think is the most important problem facing the country today?” revealed that those polled listed 31 issues ahead of national security and terrorism as problems of concern. Less than 1 percent. With the possible exception of a future China threat, most American leaders pretty much thought that we were home free after the Cold War and it was time to relax and enjoy our peace dividend. Now we’re playing catchup.

As those in this room well know, by the time we’re under assault, it’s too late to quickly rebuild our military and rebuild our human intelligence skills, develop new analyses and language capabilities, turn our FBI from an after-the-fact crime-solving organization to a before-the-fact terrorism prevention organization, and do it all within the context of a federal government that is seriously dysfunctional in carrying out many of its basic functions. Such as those relating to human resources, the kind of people we get in the government, the kind of people we try to keep, unsuccessfully too often in government, information technology, other areas that are so vitally important to our national security.

Yet, we are beginning to get our act together. We are reorganizing our homeland-security-related departments, most importantly, those dealing with border security. We are even giving the new secretary the authority to reward good performance for good work and to fire bad ones, a concept that very thought would ever find its way back into government again.

[Applause.]

Our military and intelligence budgets are coming back, and serious people are giving serious and careful consideration to the kind of intelligence and law enforcement structures that we’re going to need for the kind of world we live in today.

Now, our leaders must level with the American people. We’re not only in a long, drawn-out battle with new kinds of enemies who have ready access to tremendously destructive capabilities, as we all know, but we’re going to have because of that change our priorities. If we’re to adequately defend ourselves and our far-flung infrastructure, the federal government, state governments, local governments, private industries, are all going to have to incur expenditures greatly exceeding what we’re thinking about right now.

All of this is coming at time, of course, when our entitlement programs are in real trouble. And what this means is that we’re going to have to reduce spending in some other areas. No more farm bills, no more loading down Medicare with additional burdens that it cannot carry. I believe Americans will respond to candor and strong leadership here, and really we have no other choice.

However, just playing defense will not ensure the safety of this country. Let’s look over the last several years. For over a decade, we’ve seen increasing threats to our national security and a diminished capability, as well as a diminished will, to deal with those threats. Our enemies and our military have been attacked around the world. And the first World Trade Center bombing took place right here at home.

At least a half dozen of small rogue nations continue to build their capabilities to deploy weapons of mass destruction and the means to deliver them great distances. Al Qaeda was formed and declared war on the United States. Saddam Hussein dismantled the U.S. inspection system and basically rendered the sanction regime, which was imposed by the U.N. a nullity.

Throughout this period, while we received warnings from commission after commission and expert after expert that the threat was growing and that the United States was not prepared, the United States sent its new friends, China and Russia, high-tech dual-use equipment and technology, while they in turn supplied North Korea and Iran. North Korea became the supplier of choice for weapons of mass destruction technology and equipment for rogue nations and others.

We were told all this time, time after time, in public hearings before the governmental affairs and other congressional committees, however much like the British after World War I, we were fixated on the economy. We ignored the obvious threats that were building around us. During this time, we underfunded our military and our intelligence community. We penalized aggressive intelligence-gathering methods and placed legalistic restrictions on our law enforcement personnel that were required neither by the Constitution nor common sense.

Our reaction to the murder of our citizens and our military personnel was either weak and inconsequential, or nonexistent. In 1993 in response to an Iraqi plot to assassinate former President Bush, we blew up a single unoccupied building. In 1996 when Saddam crushed the American-supported Kurdish resistance, we attacked radar installations hundreds of miles south of the action.

Yet even today, there are those apparently including our own former President Carter, who believe that it the use of military power without broad international consensus that is currently the greatest threat to world peace. On the contrary. A large part of our problem, with both al Qaeda and Saddam is that there is a perception by many in the world that the United States has become a soft and easy target and that there will not be significant consequences to either attacking the U.S. or ignoring the directives of the world community that would have to be enforced by the U.S.

In 1991 Saddam told our ambassadors he didn’t believe that the U.S. would be able to withstand the shedding of American blood in the Arabian dessert. Even today, there are those who think, even after our initial response to September 11, that we don’t have the staying power to finish the job. Our response to the terrorist threat and to that imposed by Saddam Hussein will determine whether or not this perception will continue to grow.

What is going on in Iraq right now with inspections is essentially a farce. If there is anything that has achieved consensus status among Western intelligence agencies, it is that Saddam has weapons of mass destruction. They differ only as to the number of years they estimate it will take before Saddam has nuclear weapons capability, if he has to rely upon his own uranium enrichment resources. Everyone agrees that it’s possible he could buy fusile material from abroad and achieve that capability very rapidly.

And yet, we have a chief U.N. inspector that wasn’t the first choice, because Saddam didn’t approve of the first choice. And his team of 70 fanned out across a country the size of California, apparently to search every abandoned mine and outbuilding for incriminating evidence. Ask David Kay, or any number of former weapons inspectors who they would rate his chances of finding anything. They wouldn’t have found the results of Saddam’s nuclear efforts before–what one inspector described as a virtual Manhattan Project–without inside information.

Saddam has now had several years to perfect his already considerable talent of concealment, and now the international community is breathlessly fly-specking a 12,000 page denial from Saddam, and arguing over who should have had access to the Xerox machine to make copies.

Now all of this will lead to either, A, finding nothing of significance, or, B, Saddam denying the team access to some facility, at which point the matter would presumably come back to the Security Council. At which point the U.S. will no longer be making its case on the basis of a decade of flaunting international law; it will be based on the denial of access to some warehouse in the middle of the dessert.

The Security Council and most of the international community will rise up as one, and demand that the United States present its proof, just as not just any old violation, but a substantial violation. Sidelight photos will be demanded, as well as witnesses and other courtroom-type evidence. It will be as if a criminal, having been convicted, jumped bail, and then was reapprehended, and the prosecution is now having to try him all over again before a jury of his buddies.

Members of the Security Council such as China, Russia, France, and Germany have for some time been in open defiance of U.N.-imposed sanctions on Saddam. China has supplied him with high-tech equipment to use against our airplanes in a no-fly zone. Russia and France are doing business with Saddam. They, along with China, actually vetoed about 25 names for chief weapon inspector and then helped water down the most recent U.N. resolution against Saddam, so they’d have at least one last opportunity to bail him out, while Saddam plays for time and waits for the dessert heat.

As Farhad Zachariah [ph] said recently, “France and Russia have turned the United Nations into a stage from which to pursue naked self-interests. They have used multilateralism as a way to further unilateral policies.”

This is the jury that the United States must convince, in order to avoid being called ‘unilateralists,’ while of course the United States remains the world’s number one target, and Saddam undoubtedly continues to develop his nuclear weapons capability and increases contacts with terrorist organizations.

I believe that the administration and indeed all of us have a real appreciation for the benefits of international consensus, and doing everything that’s reasonable to achieve it. Therefore, it was probably necessary to go down the road that we’re on, even though we may soon have reason to wonder whether if the jury sides with Saddam we would then be in a weaker position for having tried.

I hope I’m wrong about this; however, if I’m not and the President finds himself still having to move against Saddam with only a few of our allies, I’m convinced that he will. While President Carter and the Europeans give us their views of international law, and admonish President Bush not to engage in a preventive war, I would refer to the words of another president, President John F. Kennedy, in 1962, when he said:

“We no longer live in a world where only the actual firing of weapons represents a sufficient challenge to a nation’s security to constitute maximum peril. Nuclear weapons are so destructive and ballistic missiles are so swift, that any substantial increased possibility of their use or any sudden change in their deployment may well be regarded as a definite threat to peace.”

President Bush knows this to be true. He understands, number one, the nature of the threats against this country; number two, that it’s his responsibility to deal with those threats; and number three, that the policies of the past have put us in greater danger, not less. I marvel at his courage, frankly, in the face of the pressures that he’s receiving, at home, abroad; but I know that he will receive our full support in the tough days ahead. We understand, as he does, that we can no longer afford to have the world doubt our resolve to defend ourselves.

And most of you have proven that you don’t have to be a politician in order to have a passionate interest in the security of your country, as well as have a significant impact on it. So that gives me great comfort, as in a few days I join most of you in the ranks of private citizens, so I can look forward to our continuing to work together, and continuing our advocacy for strong national security policy. And I especially appreciate your being here with us today.

Thank you very, very much.

[Applause.]

Frank Gaffney: Senator, thank you very much.

The most wonderful thing about what you just said is you have said it even if you weren’t retiring. You are, indeed, a man of your convictions, and I’m most excited about your comment that you’re going to stay fully engaged, even though this day job will take you off to other places from time to time.

If I may ask the first question, what did you make of the decision yesterday to turn the North Korean missiles over to the Yemenis?

SENATOR THOMPSON: I don’t know a great deal about it, other than what I’ve read about it. But I understand that the administration has said that international law required it, that’s it’s going to the Yemeni government, and not the terrorists. If that is supposed to give us a feeling of comfort. The Yemeni government has been cooperating with us in some respects.

I think that the significance of this is that it once again highlights what we have been told in public hearings by our own intelligence agencies for many years, and that that is that North Korea, while its people are literally starving to death, is the supplier of choice for that whole part of the world, in terms of conventional weapons as well as weapons of mass destruction. You know, we were shocked when a few years ago the North Koreans, to demonstrate to the world what they had, fired a two-stage rocket over Japan. And we didn’t know they had that kind of technology. And of course, as the Rumsfeld Commission report told us, and all our emphasis is on terrorism and Saddam, as well it should be, we forget that group of rogue nations the Rumsfeld Commission told us about, who are out there regularly, systematically, continually, working on their weapons of mass destruction and the means to deliver them, and North Korea is one of those.

And the Rumsfeld Commission pointed out that North Korea is one of the leading suppliers. They get aid from other super-powers, and they in turn have their own capability and are able to fund themselves apparently by selling off stuff to other rogue nations in the area. That’s what jumps out at me. A particular shipment, what international law requires or does not require what they can prove as to the destination and all that, I don’t know the details of.

But I do know something about North Korea and what they’ve been doing for several years and the threat they continue to pose.

Yes?

QUESTION: Senator, the Saudis have been exploiting this totalitarianism [inaudible] Islam and have been funding terrorists. Fifteen of the 19 hijackers were Saudis. What should we do about the Saudis?

SENATOR THOMPSON: Well, we’re going to have to change our way of thinking about the Saudis. We made a Faustian bargain with them for obvious reasons. Everybody knows that we have mutuality of interest with regard to certain things. But we need to realize that ultimately we cannot build our house upon that sand, that fundamentally it has so many problems.

It is a closed society, closed authoritarian society in a world where everywhere else free markets, democracy is making substantial progress. And it made a pact with the devil in the Wahabi Movement. And the results of that has been that we essentially have the al Qaeda we have today because of that, because of the funding that’s coming out of that part of the world. Trying to trace a particular payment from one royal family member to someone, you know, is a very difficult proposition. But the money coming out of Saudi Arabia makes al Qaeda possible.

And we need to face up to that. I think we’re going to have to take a serious look, once this issue with Saddam is settled about our troops in that area. I don’t think we can keep our troops there indefinitely. I don’t think that we can rely upon them as an energy source the way we have in the past, and still do what we ought to do. We’ve hurt our own credibility by continuing to deal with them.

And these recent stories about funding, nothing would surprise me in terms of who’s funding whom in that particular area. It is a convoluted, nefarious enterprise. And it’s not up to us to figure out all the details. We just know that it is the source. Some are witting, some are unwitting. But that country is the source of many of our problems today as well as much of our oil. So knowing those two things, we’ve got to deal with both of them.

Yes sir.

QUESTION: [inaudible]

SENATOR THOMPSON: I don’t know. That’s been a issue that’s been around for a while. And I don’t hear much about that. I think right now it doesn’t seem to be a problem. I mean the question always is, you know, if someone wanted to use their maximum leverage somewhere, what problems could that cause us? And I guess it could be substantial down there, if they wanted to cause problems for us and exert their influence down there. There’s no reason to believe that they would do that in the near future.

The real issue is: Where is China going, in general, and where are we going to be with regard to them in the years to come; what’s going to happen with regard to Taiwan. And it seems to me like there are two possible scenarios that should cause us concern.

As China tries to become more successful economically and interject a little free enterprise into their system without losing control, one cause of concern would be that if that works for them, and the other cause of concern would be if it does not work for them. If they’re able to economically feed and build their military the way I believe they want to, that certainly should be cause for concern. If the place comes apart, and if they’re making this transition, to me there’s no way they can keep the agreements they’ve made to get into the WTO.

But they’ll be struggling with that and problems out in the countryside. The graft and corruption that the people see as they make these transitions from the old system to somewhat of more touches of free enterprise here and there, lots of opportunity for corruption, a lot of people out of work, a lot of people coming to the cities and all of that.

A lot of politicians may be needing a hot button issue to keep power. Taiwan is always lying there for some demagogue to pick up on.

So we’ve totally redirected our FBI now from its traditional function to homeland security, and much of the same thing is going in the CIA. But as we’re doing that, we cannot lose site of that part of the world, and the interests that we have there.

We don’t want to wake up one day, and you know, Bin Laden has been killed, and the terrorists are all on the run, and Saddam has been overthrown, and wake up and find that we are shocked that the mainland is mobilizing against Taiwan, or that have a significant new weapon that we did not know about, because all of our resources and intelligence and concern were pointed in these other directions.

You know, we’ve got to several things at the same time better than we’ve done any of them individually for some time.

Yes sir.

QUESTION: Senator, I’m Constantine Menges, and I want to thank you very much for your leadership over the years.

SENATOR THOMPSON: Thank you.

QUESTION: [inaudible] your leadership. There is an issue that I think hasn’t gotten a lot of attention [inaudible] do several things at the same time. Our southern border is very important to the point of U.S. security and avoiding terrorism, and it seems to me that we see a pro-Castro axis of evil being established, that the [inaudible] others to come, in which radicals, pro-Castro people are democratically elected, but then once elected, as Chavez has done, they have a parallel strategy of getting along with American business, and like China doing lots of exports, but then discreetly and covertly working to help other anti-democratic [inaudible]. Right now the people of Venezuela are seeking [inaudible] major oil supplier, by the way, which are seeking to remove the Chavez regime because it has violated the constitution, and as Chairman Henry Hyde sent President Bush a very fine letter he wrote a few weeks, because he’s the chief sponsor of terrorism [inaudible] and because he is also a proud ally of state-sponsored terrorism, like Iran, Iraq, and so forth.

How do we help President Bush understand that he’s got to pay some attention to our southern border, and to tell the truth about Colonel Chavez of Venezuela and help [inaudible] people to build democracy there?

SENATOR THOMPSON: Well, I think we can help him get good people in place that he’s trying to get in place to deal with that part of the world, number one. Sound policies there. I think the President understands basically what you’re saying. We simply have to address those who sponsor and harbor terrorism, where we find it. And we have to help our friends and help those who area struggling for democracy and freedom, wherever we find that.

I’m particularly concerned about Colombia and the restrictions that we have placed on our funding down there. We are in danger of having in our own hemisphere the first narcocracy, where the drug people actually take over the government….But I’m concerned about that part of the world, as you are. I think the President’s got a good handle on it, though.

Yes sir.

QUESTION: Senator. Kevin Barnes [ph] of the U.S. Business and Industry Council. [inaudible] great enthusiasm [inaudible] thank you [inaudible].

SENATOR THOMPSON: Thank you for being here.

QUESTION: My question concerns foreign dependency. When the West Coast got blacked out, the President defended [inaudible] lockout and [inaudible] national security people as well as [inaudible]. In other words, our weapons systems are made of parts coming from overseas. It’s something that concerns us as an association of family-owned manufacturing [inaudible] it seems to us that there’s too little concern on the Hill for foreign dependency and in the whole national security view, and in general in the disappearance of our manufacturing [inaudible] moving overseas. So we only see this trend accelerating. And I wonder if that concerns you, and concerns your [inaudible] on Capitol Hill, and what we might do about it.

SENATOR THOMPSON: We don’t hear much about it, but we should. I think it’s very fact-intensive, and I think we’re going to have to rely upon the people that I feel comfortable relying on now in the administration to tell us what it is they need from abroad that they can’t get domestically, and others to tell us what we’re doing to those of us at home by going in that direction. I just think it’s a very fact-intensive kind of consideration that has to be made, but one that needs to constantly be made. I think we need to hear more about it.

Yes ma’am.

QUESTION: …the Clinton Administration which came up with the notion that there’s a new kind of terrorism that doesn’t involve states.

SENATOR THOMPSON: Does or does not?

QUESTION: Does not.

SENATOR THOMPSON: Yes.

QUESTION: Prior to the bombing of the World Trade Center in February 1993, one month into Bill Clinton’s first term in office, the prevailing assumption regarding a major attack on the U.S. was that those attacks involved terrorist states, Iran, Iraq, Libya, etc. Clinton gets elected, there’s a major attack, and he says “No state is involved. There’s a new kind of terrorism.”

Given all the reports about Iraq cooperating with al Qaeda, including a report in today’s Washington Post, and [inaudible] suspicion of New York FBI [inaudible] the World Trade Center bombings, that Iraq [inaudible], do you think it appropriate that that question of whether there really is a new kind of terrorism that does not involve states, might be revisited and re-examined?

SENATOR THOMPSON: I think it is being revisited and re-examined. I think there are some in the administration who are concerned about that very thing. There is a perception among some that the problem here is lack of intelligence, and that the CIA on that issue–I’m sure it could be put more delicately than this–but basically has been anybody’s dog that’ll hunt with them, and that they had an interest in proving that there was no connection between these terrorist activities and a nation state for a while, and now they’ve an interest in proving there is a connection between a nation state and terrorism. Which hurts the credibility of whatever intelligence you get.

So I don’t know where we are in terms of the accuracy of some of the allegations there. I do know that there have been contacts and probably meetings and things of that nature between representatives of Iraq and terrorist organizations. I saw that story in the Post this morning also, and it doesn’t surprise me at all. I assume that that is true.

But I’m not sure that we have sufficient credible intelligence that we are comfortable in relying on, right now, as to whether or not it’s true. And therein lies a very big problem that has to be addressed. Hopefully our bicameral intelligence recently, the reports coming out now, will help, hopefully the 9-11 Commission, and will further help.

But there have been an awful lot of studies about our intelligence community and ways that we could perhaps improve it. I’m hoping that more than usual comes out of these efforts, because it’s problems like these that point to the need for these efforts and to really have a real thorough analysis of what kind of leadership we’ve been getting, what we need, and what Congress should be doing.

If there ever was enough blame to go around for where we are in that regard, that’s the area of what’s happened to our intelligence over the last many years.

Yes sir.

QUESTION: What are the top three or four things, then, that you would do to fix our national security apparatus, so that we are more secure? If you had a magic wand?

SENATOR THOMPSON: I’d have to give a little bit more thought to that than you’re giving me here today. But I would start with the intelligence community. I would get some people whose judgement I trusted, and not all of them former this, that, or the others.

I would get some people who have in the intelligence apparatus, and are out and are independent. I would get some other people who would be willing to think anew about some of these things, and look at what some other countries have done. And I would require some accountability that I don’t think that we have had, and do a thorough review of what was necessary and how we can make the transition that we haven’t yet made from a Cold War apparatus to the world we live in today. And that I would insist that Congress do its part, in terms of funding, in terms of oversight, and part of that would be to reduce the number of committees involved in the process and things of that nature.

But I think it all begins with intelligence. But there are a lot of other things. National missile defense, still, would be important. And making sure that the American people understand what is at stake. Because it is now what has been the tail that whatever it is now, it is certainly waggin’ the dog. And it ought to be foremost in our mind as we consider our entitlement programs and what we do. It’s not the case now. We’re still spending money and passing programs and pork and otherwise. You know, business as usual, and no one’s being called to sacrifice anything much.

And I still really don’t think the American people have come to terms with what’s involved here. And we really, really need to do that. If you do that and the American people understand, they’ll do what’s necessary. And if that’s the case, all things are possible.

As I’m talking and thinking, you know, all these things come back to me. The entire government. Start with the CIA and the intelligence community, and then I’d go to the rest of the government. We can’t expect to have a Homeland Security Department or an intelligence agency or 15 of them, as we have, really, to operate in an efficient, accountable, capable manner, when it’s sitting in the middle of an otherwise dysfunctional government.

And the Department of Defense has got about 100 different bookkeeping systems over there. They lose ships and things occasionally over there, not the present administration, of course, but–

[Laughter.]

For years and years and years. The IRS still can’t get their computers to talk to each other. We’re losing so many good people in government we should be keeping. We can’t get rid of the ones we ought to be losing. We’ve got an archaic civil service system, that’s not serving us well at all. Overlapping duplication. We sent $30 billion in checks to people who are deceased, and things of that nature, here.

We can’t have that. We continue to grow like any democracy. The trend is always leftward. The trend is always to do what we and the British did after World War I, in times of peace. And the trend is always growth in terms of government. And now every deputy assistant has got a deputy assistant, and it’s just a proliferation of inefficiency overlapping duplication.

And up until now it’s just been waste. And our economy’s been big and strong enough to absorb it all. Still can for a good while.

But now all of that has to do with national security. We’ve got to do things differently in so many different aspects of our government, in order for the parts that are crucial to our homeland security and international security to work properly. So, there’s enough to do.

Yes sir.

QUESTION: [inaudible]

SENATOR THOMPSON: Well, because of my last statement.

[Laughter.]

I guess implicit within that is that why don’t I stay and fix it? In the first place, I put term limits on myself when I first came here. I look at the service, which I consider to be the greatest honor I’ve had in my life, to be an interruption to a career, instead of a career. I just look at it differently. I wanted to do things before and I wanted to do things after, and I jokingly point out that George Washington found eight years to be a good length of time to stay around, and he didn’t set a bad example to me and for all of us.

And I feel comfortable with that, and I wound up leaving a little before I thought I would, for various reasons. But, it’s important I think for everybody, whether they’re in public service or not, to give and do something, and do their part. And fight like hell for as long as they can, as long as the fire is burning, as long as they feel like they’re making progress, as long as they’re more happy when they get up in the morning than they are irritated.

And then move on and let somebody else do it. And understand that you, however, are a small cog in a big wheel. And it’s important that you do your part, but understand that you can’t do all these things singlehandedly. You can only do your part.

So I like to feel that that’s been the case with me, and that others will come along. That’s the beauty of our system. It’s not dependent upon a handful of people to stay for 50 years in order to save the nation. We’re regenerative and continue to produce good people with new ideas and new enthusiasm, new idealism.

Plus the fact, as I said, I want to say involved, whether it be writing or lecturing, or teaching, or think tanks, or what not. There are often ways. Ask Gary Hart and Warren Rudman what they think they’ll be known for. Their Senate service? You got Hart-Rudman. You’ve got Gramm-Rudman, yes that was important. But what do you think they’ll be mainly known for? I think it will be the service after the Senate. So there’s that too.

Yes sir.

QUESTION: Senator, the ACLU is spending a considerable amount of money running ads alleging that the attorney general is rewriting the Constitution [inaudible] the same charge [inaudible] rapidly diminishing audience–

[Laughter.]

SENATOR THOMPSON: But I think they both agree with him, though.

QUESTION: [inaudible]. The question is: Have we sacrificed civil liberties on the war on terrorism to date? Do we need to sacrifice some liberties in order to prevent [inaudible] war on terrorism?

SENATOR THOMPSON: It’s a constant balance that every democracy has between security and liberty. And in tough times the compromises get to be a little tough, sometimes. But the short answer to you question is ‘no.’ We’re essentially getting back to where we should have been to start with.

To give you a good example is this so -called wall between the intelligence agencies, between the FBI and the CIA. Totally a self-inflicted wound. Congress didn’t require that. The Constitution didn’t require that. It was done administratively until the FISA court of review pointed out the other day, “Where did this come from?” You all have been doing it this way for two decades, but you didn’t have to.

So, now, you know, they can cooperate with each other. Duh, you know.

[Laughter.]

In terms of Patriot Act, you know, updating. People don’t have one telephone they use at home any more, you know. They run around with these cell phones and throw-away phones and things of that nature. So you could address the warrant to the person instead of the phone. It’s just updating something that should have been updated many years ago. You know, that’s the sort of thing that we’re dealing with.

You take the total awareness system out at the Pentagon. I believe that’s what they call it. Total Awareness. I’d believe I’d get a new acronym for it. Whoever’s in charge of names might consider that.

So there is a project out there to use available technology and develop technology where software systems can be intermingled and we can develop the access to use software systems, both in government and in private industry the way private industry is doing already now in many cases, in other words, to come all this information. If a terrorist gets on a plane in San Francisco at 12:00 noon, a known terrorist, or someone questionable gets on a plane in New York at 12:05, and they both have the same destination and something like that, and they both purchase similar things before they went, according to their credit card purchase, I’d like for my government to know that.

Obviously it’s something that could be abused. We’ve got, what, a dozen privacy on the laws on the books for various things, now, we will continue to have. We have a privacy officer in the Homeland Security Bill with good authority. Privacy and congressional debate, of course, will come about from the process if this thing ever gets off the ground. It’s totally a research project now, as best I can tell.

But what is the main criticism that Congress and the American people have had of our intelligence community from September 11? Why couldn’t they connect the dots? If you see this and you see this and you see this. We didn’t have anybody to connect the dots. Well, guess what? That’s a dot connector. Now the question is: Do you really want to connect the dots? And if you do, you’re going to have to give the somebody authority that could be abused, much as we give other people authority as they can be abused, if they’re not watched.

But it is a trade-off. It is something, certainly, that we can do. It’s a capability we can have with safeguards, and we’d better get about it. Because we are woefully in adequate in that whole area in terms of information technology and related things. Way behind private enterprise with regard to that.

So I think on the detention, that issue is working its way through the courts, I think, successfully. I don’t think it’s a good idea, and I’m not sure what the administration’s position is. But it’s not a good idea for the President to be able to make a decision with regard to an individual without any judicial supervision at all. But there’s no problem with bringing a person, even a combatant, before a judge, and saying “We’ve determined that he’s a combatant,” and give a little bit of showing that “we’ve determined that this person is a combatant” and detain them indefinitely.

History supports this. The Constitution supports it. What cases are on the books support this. Whether or not he has a right to counsel, perhaps, as long as it’s monitored. You have compromises that are being made now in district courts around the country to ferret this thing out, so that we can keep the President traditional authority, but keep it within bounds.

I feel very good about this part of the equation. I think we’re striking a very good and reasonable balance in moving in the right direction, and considering that balance between security and liberty.

Now I can stay here as long as you all want to, but anybody who wants to go can–

[Laughter.]

You’re not going to hurt my feelings.

QUESTION: What would you do to change immigration policy for purposes of enhancing national security?

SENATOR THOMPSON: Oh, man, I don’t know. I think–

[Laughter.]

I think probably the first step is what we did with homeland security. I think combining the border-related activities, whether they be persons or whether they be goods, or whether they come in air, sea, or land. And getting some organization. We need to go back to square one, and get some semblance of organization there in terms of the law enforcement aspects of these things.

Other than that, I don’t know. I mean, we’ve got, I forgot how many million of people I read are illegal immigrants in this country on any given day. We clearly have got to be able to do a better job of keeping up with people who come in. And we maybe have to change our criteria. And it’s like the rest of these things we’re talking about. There’s so much balance involved in it.

You know the people who press the most for these numbers are business people, who want these people to come in to help them in these areas, that they need help in. And there’s a lot of political pressure along those lines, and they are legitimate points. I mean everything from agricultural workers to computer technicians.

So there’s just a lot of competing and balancing interests out there. And it’s way over my head, really, other than to reorganize and start over again.

I’ll take one more.

Yes ma’am.

QUESTION: A lot of us were extremely enthusiastic about President Bush [inaudible] recognition [inaudible] on outlying terrorist infrastructure [inaudible] democracy [inaudible] extremely [inaudible] yet I’m really concerned that there are some [inaudible] United Nations [inaudible] European Union, Russia, and the State Department [inaudible] just one [inaudible] road map which [inaudible] a provisional Palestinian State in 1992 [inaudible] 1994, even though the Palestinians [inaudible].

SENATOR THOMPSON: Well, I am too. I was not aware that it was quite as bleak as apparently it is. But the creation of a state without the other conditions is going to be meaningless and it’s not going to lead to peace. As long as the driving and moving force among the Palestinians, the force that’s in the saddle is bent upon the destruction of Israel, it doesn’t matter what form they take or what state they’re in, or what promises they make. There’s not going to be peace there. And that’s the situation that we’re in.

I’m hopeful that if the situation in Iraq goes the way that it will go, that this will eventually help in that regard. Nothing else of an outside forced nature seems to be making any impact on anyone. And just think about what it would be like to have another, at least mainly democratic state in that part of the world.

Unfortunately there are still a lot of people in the world who only respect power and the effective use of it. And I think if things went well for us, that we could get over the hurt feelings, and have another good thing going in that part of the world that would have a salutary effect on that problem.

Thank you very much.

[Applause.]

Frank Gaffney: One administrative matter. I want to thank the Chairman of our board, Jim DeGraffenreid, and Ibrahim David Muzzazaday [ph], who could not be here from New York for making this luncheon possible. I appreciate very much their sponsorship and friendship and particularly for allowing us to I think render a fitting if modest tribute to this distinguished United States senator.

And Senator, let me just close by saying again thank you on behalf of all of us. What you’ve said here today, what you’ve been saying for eight years, what you stand for, and what I know you will continue to do in the future, is exactly what we’re talking about in this citation, about inspiring those who will hopefully be carrying the torch forward with you, and after your departure from the Senate.

So thank you to you all. I wish the season’s greetings, and look forward to working closely with you and Senator Thompson in 2003. Be well.

[Applause.]

 

Message to Wall Street and Pennsylvania Avenue: Bank of New York’s Russian Debacle is but a Symptom of a Larger Problem

(Washington, D.C.): With breath-taking speed, the scandal described by the New York
Times
as
“one of the biggest money-laundering operations ever unearthed in the United States” is
expanding with implications for the future position of a major U.S. commercial bank, the
presidential election prospects of Vice President Al Gore and the Kremlin’s
relationships with
the United States, the International Monetary Fund and other benefactors.

The Clinton Administration is in a desperate damage-control mode. Yesterday,
Treasury
Secretary Lawrence Summers
was reduced, it seems, to echoing House Banking
Committee
Chairman Jim Leach’s (R-IA) recent admonition that the U.S. should not support future IMF
disbursements to Russia “without adequate safeguards to assure that any funds disbursed are
used properly (and) without adequate accounting for the previous use of funds.” The question
now is: Will the next shoe to drop, in the absence of these and other “safeguards,” be
one
that affects (literally) a host of American equities, via the Nation’s capital markets?

A Bill of Particulars

A recap of some of the relevant highlights of the current drama, which began last month with
the
publication of reports that the Bank of New York (BoNY) was suspected of laundering at least
$4 billion — and perhaps as much as $10 billion — in funds possibly tied to Russian organized
crime and/or top Kremlin officials and their associates, includes the following:

  • According to various reports, the BoNY account maintained by the Russian firm, Benex
    Corporation, alone saw over 10,000 transactions involving some $4.2 billion between October
    1998-March 1999. Law enforcement and other U.S. officials, moreover, are currently said to
    be investigating thirty-three companies that have done business with the bank to determine
    whether any others have engaged in suspicious Russian-related financial activity.
  • The misappropriation of taxpayer-funded aid flows to Russia from the International
    Monetary
    Fund and the U.S. Agriculture Department has also been alleged. While both agencies have
    vehemently denied such charges, the IMF has admitted that monitoring internal disbursement
    of aid flows has proven to be more challenging than it previously anticipated. In fact,
    according to a Wall Street Journal article of 25 August, investigators have identified
    at least
    $200 million in IMF funds which surfaced in a Russian Channel Islands account for a short
    period before it was diverted to an unknown location. It is impossible to say with certainty
    how much of the more than $20 billion in Western taxpayer funds that the IMF has lent
    Russia since 1992 has met a similar fate.
  • Russian organized crime syndicates are not the only entities suspected of laundering funds
    through the Bank of New York, and perhaps other Western financial institutions. President
    Yeltsin’s political “families” — the latter prominently including a number of former
    apparatchiks-turned-“oligarchs” — have also been implicated. Of particular concern is the
    apparently deliberate leaking of closely-held Russian plans to devalue the ruble and default on
    some $40 billion in GKO debt. Insider-dealing seems to have contributed to the accelerated
    movement of capital out of Russia that immediately preceded this action taken on 18 August
    1998.

Importantly, much more appears to be in jeopardy than the interests of an American
commercial bank and U.S. and multilateral financial institutions. Consider the following recent
revelations that indicate the U.S. capital markets are also being penetrated by “bad actors” 1:

  • A U.S. company named YBM Magnex — which has been linked to the same
    Russian-owned
    entity, Benex Corporation, that has been accused of facilitating the money transfers via its
    Bank of New York account — was once publicly traded on the Canadian stock
    exchange
    .
    According to a 19 August New York Times report on the matter, American
    officials believe
    that the YBM case “was one reflection of the success of Russian organized crime in
    infiltrating Western financial markets.”
  • On 30 August, USA Today reported a troubling — and possibly related — story
    of Bank of
    New York assistance to another questionable Russian institution, Inkombank,
    in winning
    regulatory approval to sell the Russian bank’s stock in the U.S. equity market via American
    Depository Receipts (ADR’s). It is said to have done so at a time when even Russian
    regulators had the bank under investigation
    .

    According to USA Today, the bank avidly promoted
    Inkombank’s 1995-96 bid to sell
    bank shares to U.S. investors through the ADR mechanism. According to Russian
    investigators cited in the article, Inkombank had “inflated its income in 1995 by tens
    of billions of rubles” and had “violated numerous laws and accounting standards.”
    Incredible as it may seem, the bank still received permission to trade its ADR’s on the
    U.S. equity market in 1996 — even though regulators in Moscow were not the only
    ones aware of the apparent scam: The SEC and the Federal Reserve Board
    reportedly also received notice of these suspected misrepresentations,
    as well as
    English translations of Inkombank’s financial reports. The bank was declared
    insolvent following the Russian financial collapse of last year.

  • According to the New York Times of 29 August, investigators suspect
    Semyon Mogilevich, a
    shadowy Russian operative who Western intelligence sources claim is “a major figure in
    Russian organized crime,” is a primary player in the money-laundering scandal. Mogilevich
    is reportedly engaged in, among other activities, international arms trafficking. As the
    Times
    noted: “An F.B.I. report on Russian organized crime said that when the Soviet Union
    withdrew its military forces from East Germany, many Russian generals sold their weapons to
    Mr. Mogilevich, who in turn sold them, at much higher prices, to countries like Iraq, Iran and
    Serbia.”

The Gore Policy Toward Russia’s Systemic Corruption: ‘Don’t Ask, Don’t
Tell’

The Center for Security Policy and its Casey Institute have long been concerned about the
apparent, if (in some cases, at least) unwitting, collusion between the Clinton-Gore
Administration and corrupt elements in both official and unofficial circles in Russia. 2 The now-unfolding scandal only serves to reinforce this
concern. The difference is that, today, it is a
widely shared apprehension.

For example, in response to a condescending call published this week in
Newsweek by Deputy
Secretary of State Strobe Talbott — one of the principal architects of the Clinton Administration’s
failed Russia policy — for the world to “calm down,” long-time Washington Post
foreign
correspondent and columnist David Ignatius wrote in today’s edition:

    The strategist Albert Wohlstetter 3 liked to
    observe that when policymakers talk
    about a “calculated risk,” it usually means they haven’t done any calculation.
    What they’re really describing is a simple gamble, a roll of the dice.
    Wohlstetter’s
    remark is a useful rejoinder to recent characterizations of the Clinton administration’s
    policy toward Russia as a calculated risk — a reasoned bet that the benefits of
    economic reform would outweigh the dangers of corruption….

    It would be more reassuring if these folks told the truth: Our policy
    toward
    Russia has been a crap-shoot, and growing evidence — symbolized by recent news
    reports on the alleged $10 billion Russian money-laundering operation through
    the Bank of New York — suggests that it hasn’t worked….
    The bottom line is that
    Clinton and Gore had lots of warnings about Russian corruption under Yeltsin’s
    banner of reform. And the question continues to be: Why didn’t the Administration
    do more to stop it?
    (Emphasis added throughout.)

The ‘Culture of Corruption’

In addition to strengthening an already robust Russian “moral hazard” trap — Russia’s
financial
and political elite are well-versed in capitalizing on Western bailouts — the kind of
non-transparent official relationship epitomized by the secretive Gore-Chernomyrdin sessions
has served to
encourage Russia’s thriving system of corruption by refusing to penalize corrupt financial and
political behavior.

This week’s edition of the Economist gives a name to this sort of relationship
and the behavior it
spawns: a “culture of corruption,” a culture, unfortunately, that extends far beyond Russia. In a
powerful editorial, this respected journal declared:

    Far from “civilizing” the wreckage of the Soviet economy, economic transactions
    between Russia and the West are running the risk of corrupting the Western side, if
    only by forcing it to wink at practices which would be outlawed in more established
    economies. There is a particular irony in the fact that one western party is the IMF,
    whose stated purpose is to propagate virtues of sound economic policy and good
    governance. But if the IMF’s integrity has been compromised, the cause does not
    lie in its own sloppy controls; it lies in the collusion of the American and Russian
    governments
    to cover up failures and press the Fund into treating Russian with
    greater generosity than its economic performance would warrant.
    (Emphasis
    added.)

The Bottom Line

The multi-billion-dollar scale of this latest financial scam by global “bad actors” in
the U.S.
financial markets calls into question the SEC and other official regulators’ ability to
monitor effectively transactions involving dubious foreign entities — let alone their ability
to protect adequately U.S. investors and depositors, to say nothing of the national
interest.

Among the “follow-the-money” questions which should now be asked are: What were the
precise sources of cash profits being funneled through U.S. institutions? Which specific
individuals and/or enterprises were involved? What policy and procedural changes need to be
made to prevent a repetition of such misconduct?

It is heartening that Rep. Leach’s Banking Committee will shortly be holding hearings (at
this
point scheduled for September 21-23) at which, it is to be hoped, these and related questions
about the emerging scandal and its implications will be addressed. The Casey Institute urges the
Senate Banking Committee — and other relevant panels on Capital Hill (especially
those with
oversight responsibility for arms trafficking and proliferation matters) — to convene their own
companion hearings on this long-neglected subject. As Steve Forbes (the
1994 recipient of the
Center for Security Policy’s “Keeper of the Flame” award) observed yesterday, Vice
President
Gore should properly be among those high-level Administration officials (notably, Strobe
Talbott, Sandy Berger and Larry Summers) called to testify at such hearings.

Such hearings should also give fresh impetus to the need for legislation like “The
U.S. Market
Security Act of 1999″
(H.R. 2204), sponsored by House Banking Subcommittee
Chairman
Spencer Bachus (R-AL) and Rep. Dennis Kucinich
(D-OH). This bill would require an Office
of National Security to be established at the Securities and Exchange Commission

charged
with reporting to responsible congressional committees on a quarterly basis the names of foreign
government-connected entities seeking to enter the U.S. capital markets. Even though the
mandate of such an office would be modest and limited in scope (i.e., a far cry from undesirable
capital controls 4), it would send a needed
message to global wrong-doers that the United
States is, at long last, following the money.

1For example, the issuance of some $800 million in U.S.
dollar-denominated bonds and roughly
$2.5 billion in yen-denominated bonds by arms dealer Wang Jun’s China International Trust and
Investment Corporation.

2 For example, see the Center’s Decision Brief
entitled Clinton Legacy Watch # 33: ‘See-No-Evil’ Security
Policy-making
(No. 98-D 189, 23
November 1998). It stated, in part:

    Today’s New York Times discloses that in 1995 Vice President Al Gore
    chose not to
    be ‘bothered with the facts’ — even though they called into question the premises of
    foreign policy initiative in which he and the rest of the Clinton Administration had
    hugely over-invested: a policy of U.S. ‘support’ for Russian ‘reformers’ led by
    President Yeltsin and Prime Minister Viktor Chernomyrdin, no matter what. As the
    Times put it:

“When the CIA uncovered what its analysts considered to be conclusive evidence of
the
personal corruption of Prime Minister Viktor Chernomyrdin of Russia in 1995, they sent it to the
White House, expecting Clinton administration officials to be impressed with their work. Instead,
when the secret CIA report on Chernomyrdin arrived in the office of Vice President Al Gore, it
was rejected and sent back to the CIA with a barnyard epithet scrawled across its cover,
according to several intelligence officials familiar with the incident.

“At CIA headquarters in Langley, Va., the message seemed clear: The vice president did not
want to hear allegations that Chernomyrdin was corrupt and was not interested in further
intelligence reports on the matter. As a result, CIA analysts say they are now censoring
themselves.”

    But the Times report makes clear that the Russians have been making
    choices for
    years now, many of them seriously wrong. Specifically, under Prime Minister
    Chernomyrdin, the Kremlin embraced crony capitalism with a vengeance — the
    thoroughly corrupt mutant “market” system that has brought grief to economies
    throughout Asia and, most recently, in Russia itself. In fact, Chernomyrdin could have
    been the poster-child for this practice of self-dealing and -enrichment at the expense of
    the state and its citizenry.

    Obviously, the highest levels of the Administration — most especially Vice
    President Gore, Chernomyrdin’s interlocutor in a highly secretive joint
    commission — did not want to change American policy towards Russia in light of
    the thoroughly dishonest character of the government in Moscow. It did not even
    want to know about the Kremlin’s dishonesty.

3In 1993, Dr. Wohlstetter was recognized for his innumerable,
brilliant contributions to U.S.
security policy over five decades with the Center’s distinguished “Freedom Flame” award. For a
text of his remarks on that occasion, see Aspin, Woolsey Join Center in Honoring
Albert
Wohlstetter, Winner of the 1993 ‘Freedom Flame’
( href=”index.jsp?section=papers&code=93-P_81″>No. 93-P 81, 21 September 1993).

4See the following Casey Institute Perspectives
entitled Bipartisan Congressional Letter Is
Wake-up Call To State Officials Re: Portfolio Security Concerns
( href=”index.jsp?section=papers&code=99-C_88″>No. 99-C 88, 4 August
1999); Casey Initiative to Increase Transparency Re: Bad Actors’ Efforts to
Penetrate U.S.
Capital Markets Gains Momentum
(No. 99-C 80,
13 July 1999); A Job for C.F.I.U.S.:
Proposed Chinese Buy of U.S. Telecommunications Assets Needs National Security
Scrub

(No. 99-C 75, 3 July 1999); and ‘Follow the Money’:
The Next Shoe to Drop on China Scandal
Should be Its Penetration of the U.S. Bond Market
(No.
99-C 57
, 13 May 1999).

1998 Freedom Flame/Casey Medal of Honor Award: Jeane Kirkpatrick

jeane-kirkpatrick(Washington, D.C.): At a moment of profound national angst over the domestic implications of President Clinton’s personal and public misconduct, one of the most respected figures in America — Ambassador Jeane J. Kirkpatrick — yesterday issued a moving tribute to leaders of character from the past, and warned of the danger to this country’s worldwide interests if such qualities remain absent in the White House into the future.

The occasion for Dr. Kirkpatrick’s remarks was a luncheon held in her honor by the Center for Security Policy’s William J. Casey Institute. The former U.S. Permanent Representative to the United Nation’ received the “Casey Medal of Honor” [later renamed the Center’s Freedom Flame award] in the ballroom of the elegant Park Hyatt Hotel in Washington filled with nearly two hundred of her friends and admirers (including, among other distinguished guests the Chairman of the House International Relations Committee, Rep. Benjamin A. Gilman (R-NY)). This award was conferred in recognition of her extraordinary contributions to the Nation, both during her tenure at the UN and throughout a long and distinguished career in academe, as an author, as a syndicated columnist and as a valued participant in myriad presidential, departmental and private sector commissions and advisory boards — including that of the Center for Security Policy.

The following offer a sample of the deeply touching and inspiring thoughts shared by Dr. Kirkpatrick in the course of her informal address:

There were many aspects that account for the strength of the Reagan Administration and the success of it. But the most important of all, I think, was a love of our country, in fact, and an appreciation of our freedom, above all. A sense that our freedom was our most important heritage, our most important possession. It was the secret of our success.

It was a great privilege to work with those men…all of whom were good men, they were men of good character. As President Reagan himself was a man of good character and Ed Meese and, God knows, Bill Casey was a man of good character — as well as great intelligence and dedication, and skill and ability. I think that was an important factor in our success, a more important factor, perhaps, then we thought at the time.

The importance of preserving our traditional national character is the prerequisite, if you will, even to providing for our defense. On our character we must rest our defense. On which then rest our freedom and security….I know, frankly, no one — just no one — who more clearly, fully, completely reflected that character then our good friend, our warm friend, my best friend practically, Bill Casey.

Dr. Kirkpatrick also used the Casey Institute forum to address a matter of substance — one which she, correctly, considers to be of the utmost importance: the need to protect the United States against ballistic missile attack. Contrasting our present posture of utter vulnerability to such a threat with the America homeland’s historic invulnerability to foreign aggression, she observed:

The loss of that invulnerability is the real strategic revolution that has occurred in our times and with which we must cope. Meeting that challenge, which is the loss of our invulnerability, is the most important task that we confront and will continue to confront until we have, in fact, met the challenge and dealt with it. One of the many common causes which has brought the Center…and its [Board of Advisors] together many times, in common cause, is our commitment to provision of an effective, really effective, national missile defense which can end our vulnerability and return us to the security that has been ours all our national life.

The award luncheon began with a welcome by Bernadette Casey Smith, William J. Casey’s daughter, that called to mind the deep mutual respect and personal affection shared by her father and the honoree. A similar portrait of abiding respect and sense of purpose shared by Ambassador Kirkpatrick and the man in whose Cabinet she served so ably — President Ronald Reagan — was painted by former Attorney General Edwin Meese III in his formal introduction of Dr. Kirkpatrick. Mr. Meese, who also worked closely with the Ambassador in his capacity as Counselor and close advisor to President Reagan, was the first recipient of the Casey “Medal of Honor.”

The luncheon concluded with the presentation of the “Casey Medal of Honor” by Mrs. Sophia Casey, CIA Director Casey’s beloved widow.

Casey Institute Symposium on Russia

Many of those who participated in the luncheon then joined in an afternoon-long symposium entitled “Russia: Transformation or More Financial Bailouts?” The stage was set for this exceptionally timely symposium by Hon. Roger W. Robinson, Jr., former Senior Director of International Economic Affairs at the National Security Council under President Reagan and currently President of RWR, Inc.

Mr. Robinson, who holds the Institute’s Casey Chair, provided a review of the important elements of the financial and political drama unfolding in the former Communist state. Mr. Robinson also offered several notable prescriptions for Russian reform (e.g., conditioning further governmental aid flows on a curtailing of Russian military and foreign policy activities threatening to U.S. and Western interests; institutionalizing protections for private property; adopting Western legal and commercial codes; and focusing on the creation of a environment conducive to the growth of small- and medium-sized businesses).

Participants then heard a fascinating address by Dr. Judy Shelton, a widely published and respected economist whose work focuses on international monetary, finance and trade. Dr. Shelton reviewed the impact of the ruble’s devaluation on global currencies and financial flows. She also underscored the failings of government-to-government transfers to encourage real economic reform in Russia and warned that the lack of a viable currency in Russia meant any reforms were essentially building on quick sand.

Next the symposium heard from Dr. Marshall I. Goldman, the Kathryn Wasserman Davis Professor of Russian Economics at Wellesley College and Associate Director to the Davis Center for Russian Studies at Harvard University. Long regarded as one of the United States’ foremost experts on the Russian economy, Dr. Goldman presented a rather bleak assessment of the prospects for economic and political reform. Among Prof. Goldman’s many notable insights were his estimation of the possibility — and potential beneficial effect — of a decentralization of the Russian Federation to the extent that the regions engage in real curbs on the mafia and the building of institutions necessary for genuine democratic pluralism and free market economies.

Mr. Thomas Moore, Director of the Kathryn and Shelby Cullom Davis International Studies Center at The Heritage Foundation, concluded the symposium with an informative address concerning the strategic nexus between finance and national security, in particular focusing on the actual — if unintended — effects of past and future western aid flows to the former Soviet state. Mr. Moore expressed concern about the United States’ apparently continuing unwillingness to recognize the danger inherent in providing U.S. tax dollars to the Russian government as it proceeds, among other things, threatening strategic modernization programs.

– 30 –

1997 Freedom Flame/Casey Medal of Honor Award: Edwin Meese III

FF1997-MeeseThe Casey Institute of the Center for Security Policy is honored to award one of our own, Edwin Meese III, with the inaugural Medal of Honor in recognition of his outstanding contributions to our Nation in a variety of high-level positions — both past and present. His record of exemplary public service spans more than three decades.

Ed started his tireless service to his country as a Deputy District Attorney in Alameda County, California. In 1967 he began his association and journey with the man who would later become our 40th President, Ronald Reagan — as then-Governor Reagan’s Legal Affairs Secretary and later Executive Assistant and Chief of Staff. From 1977 to 1981, Ed was a professor of Law at the University of San Diego, where he also served as Director of the Center for Criminal Justice Policy and Management.

During the 1980 presidential campaign, Ed served as Chief of Staff and Senior Issues Advisor for the Reagan-Bush Committee. Following Ronald Reagan’s election in 1980, he headed the President-elect’s transition team. After being sworn in, the President again looked to his friend Ed Meese for guidance and sound policy directives. He appointed Ed to the position of Counselor to the President, where he functioned as the President’s chief policy advisor with management responsibility for the administration of the Cabinet, policy development, and planning and evaluation.

From February 1985 to August 1988 Ed proudly served his country as the Seventy-fifth Attorney General of the United States. During his tenure in the Reagan Administration, he was a member of the President’s Cabinet and the National Security Council.

In June 1992, Regnery Gateway Publishers released With Reagan: The Inside Story by Ed Meese. In it, he describes with characteristic eloquence his time with the President and the extraordinary individuals within his inner circle. One such individual given credit for greatly enriching both Ed’s experience and the well being of our Nation is Bill Casey. “First and foremost,” Ed begins his book, “then entire nation owes a debt of gratitude to the late William J. Casey. Without his timely entrance into the leadership of the Reagan campaign, the Reagan presidency might never have become a reality. Later, as Director of Central Intelligence, he was a principal supporter and promulgator of the Reagan Doctrine, which resulted in the liberation of millions of people throughout the world. Bill’s post in the Reagan Cabinet capped a lifetime of public service as a lawyer, businessman, philanthropist, and leader. He was a good friend and a true patriot.”

The Center for Security Policy takes great pleasure in joining with Bill Casey’s family in expressing our gratitude to Edwin Meese by awarding him the first Casey Medal of Honor. [The Medal of Honor award has been renamed the Freedom Flame.]

In Memoriam
Albert Wohlstetter

(Washington, D.C.): The Center for
Security Policy mourns the passing today
of Dr. Albert Wohlstetter at his home in
Los Angeles. The Nation has lost one of
its greatest intellects and, arguably,
the most accomplished conceptualizer and
practitioner of U.S. strategic policy of
the post-war era.

Dr. Wohlstetter’s imprint is to be
seen in virtually every aspect of
national security — from the earliest
evolutions of U.S. nuclear policy and
programs to the ongoing travesty of
President Clinton’s handling of the
genocidal conflict in Bosnia. His unique
grasp of the principles of power in the
international arena and the technology of
modern warfare made his counsel
invaluable to policy-makers for fifty
years. As Richard Perle, a former
Assistant Secretary of Defense and
founding member of the Center for
Security Policy’s Board of Advisors, put
it at a 1993 event at which Dr.
Wohlstetter received the Center’s
“Freedom Flame” award:

“Albert Wohlstetter has
compiled a record of prophesy of
such accuracy and such depth that
those of us who pay attention can
only marvel at. But it must also
leave hundreds of his
interlocutors over the years
wishing that they had acted more
consistently on his advice.”

Even when in his eighties, Dr.
Wohlstetter exhibited all the energy,
brilliance and righteous indignation that
was the hallmark of a man who, throughout
his career, strove to maximize the
security of this country and its
interests around the world — and who
refused to conceal his disdain for those
whose naïvétè, ignorance or
incompetence jeopardized that objective.
His critiques were not partisan but
substantive. For example, he was no less
sparing of President Bush for his failure
to make the destruction of Saddam
Hussein’s regime an objective and result
of Operation Desert Storm than he was of
President Clinton’s refusal to bring
American power to bear effectively
against the precipitator of the Balkan
tragedy, Slobodan Milosevic.

Throughout
his distinguished career, Dr. Wohlstetter
acted as mentor and teacher to those at
the highest ranks of government — both
in the United States and abroad — and
many of those who will come to hold such
positions. The long-time University of
Chicago professor exercised a profound
influence on millions more who never had
the privilege of being in his presence,
through his innumerable op.ed. columns,
essays, analyses and books. And literally
every American owes Dr.
Wohlstetter a unpayable debt for the
contribution he made during a lifetime of
service to the Nation to their safety and
well-being.

Albert Wohlstetter’s was a voice of
reason and integrity, of principle and
genius. His mind was ever engaged in
discerning the shape of future threats
and opportunities — and defining
constructive approaches for dealing with
them. He was a leader who operated
generally behind the scenes and largely
without seeking or receiving the credit
he was so often due. He and his beloved
wife, Roberta — a remarkable woman whose
pioneering work in the field of
intelligence and defense analysis
complemented and inspired that of her
husband — can only be described as national
treasures
, a fact recognized by
President Reagan’s awarding them the
Presidential Medal of Freedom. Albert
Wohlstetter will be sorely missed in the
difficult days to come by the Center for
Security Policy and all who share his
passionate commitment to freedom.

– 30 –

‘WHAT’S WRONG WITH THIS PICTURE?’ EVEN THE ‘OFFICE FOR SECURING CLINTON’S ELECTION’ CANNOT OBSCURE HIS FAILURE IN BOSNIA

(Washington, D.C.): Even as President
Clinton takes credit on the campaign
trail for his Administration’s diplomatic
accomplishment in bringing peace to
Bosnia, the evidence is mounting that —
despite the commitment of thousands of
U.S. forces and the expenditure to date
of some $4 billion in American tax
dollars there — a real and
durable peace is nowhere in sight
.
To the contrary, the U.S.-brokered Dayton
Peace Accords are increasingly being
shown for what they were: odious
deals with war criminals, deals that have
served only to postpone until after the
U.S. election execution of the
“final solution” for
multi-ethnic Bosnia-Hercegovina
envisioned by Bosnia’s Serb and Croat
neighbors
.

Wohlstetter: Discredit
Where it is Due

A characteristically brilliant essay
by Dr. Albert Wohlstetter, which was
published in the Wall Street Journal
on 23 October, established that this
odious outcome is no accident.
Professor Wohlstetter — one of this
century’s foremost American strategists
and a recipient of the Center for
Security Policy’s Freedom Flame award
(among many other distinctions) —
describes steps taken by the Clinton
Administration in the months leading up
to the Dayton Accords.

In so doing, Dr. Wohlstetter shows
that these agreements were but the
logical by-product of a
Clinton-Holbrooke campaign to preserve
the despotic Serb regime of Slobodan
Milosevic and enable the ultimate
partition of Bosnia
. As he put
it:

“Just when the Bosnians were
on course to recover all of the
territory that Serbia had seized,
Richard Holbrooke and other Clinton
aides moved to stop the rout into
Serbia of its own and proxy armies.
At Dayton, Mr. Clinton rolled back
essentially all of the territory the
combined [Croat and Bosnian] armies
had regained in Bosnia….Mr.
Clinton’s policies left the remnants
of an indivisibly mixed Bosnia in
indefensible, disconnected fragments,
under siege by Franjo Tudjman’s
Croatia as well as Mr. Milosevic’s
Serbia.”

The Iranian Foothold

In contrast to Mr. Clinton’s
self-serving characterizations of his
Bosnia policy, an honest
appraisal of the Administration’s record
shows it to have been immoral
in its indifference to the plight of the
victims of Serbian aggression, shortsighted
in its de facto support for Serb
territorial ambitions and strategically
disastrous
with respect to its
acquiescence in the Iranian penetration
of the European continent. With respect
to the last of these, some sense of the
enormity of the Iranian-Bosnian arms
debacle was recently provided by the
House Select Subcommittee on Iranian Arms
Transfers chaired by Rep. Henry Hyde
(R-OH), a distinguished member of the
Center for Security Policy’s Board of
Advisors. On 10 October, the Subcommittee
published its findings which concluded,
among other things, that:

The President’s
decision to give Iran a green light
in the Balkans allowed Iran to expand
its economic and diplomatic
relations, as well as establish a
military, security and intelligence
presence so expansive it became the
largest concentration of official
Iranians outside the Middle East.

The consequences have been
far-reaching and pernicious. They
persist to this day.

“The consequences of the
green light policy have been much,
much worse in Bosnia. After the
Administration gave the green light,
Iran virtually overnight became the
unrivaled foreign benefactor of the
Bosnian government. As a
result, the Bosnian government became
less secular and democratic and more
open in its embrace of a radical
Islamic political agenda acceptable
to Iran but inimicable to U.S.
national security interests and
democratic values.”

“The Iranian presence and
influence jumped radically in the
months following the green light. Iranian
elements infiltrated the Bosnian
government
and established
close ties with the current
leadership in Bosnia and the next
generation of leaders. Iranian
Revolutionary Guards accompanied
Iranian weapons into Bosnia and soon
were integrated in the Bosnian
military structure from top to bottom
as well as operating in independent
units throughout Bosnia. The Iranian
intelligence service ran wild through
the area developing intelligence
networks, setting up terrorist
support systems, recruiting terrorist
‘sleeper’ agents and agents of
influence, and insinuating itself
with the Bosnian political leadership
to a remarkable degree.”

“[In short,] the
Iranians effectively annexed large
portions of the Bosnian security
apparatus
to act as their
intelligence and terrorist
surrogates. This extended to the
point of jointly planning terrorist
activities. The Iranian embassy
became the largest in Bosnia and its
officers were given unparalleled
privileges and access at every level
of the Bosnian government.”

“Despite the Administration’s
public assurances to the American
people and Congress to the contrary,
Iranian influence in the highest
Bosnian ruling circles remains
pervasive and Iranian terrorist and
intelligence capabilities in Bosnia
remain great cause for U.S. concern.
The Iranians are biding their time,
and the radicalized Bosnian Muslim
political leadership (in contrast to
a largely secular population), may
yet succeed in turning Bosnia into a
radical and authoritarian state.
There appears to be little hope that
the situation will improve since the
Bosnian government is fighting
tooth-and-nail U.S. efforts to cut
its ties to Iran. The probability
that the green light will end up
costing American lives is all too
great given Iran’s track
record.”

In releasing the Subcommittee’s
report, Chairman Hyde bluntly warned:

“We will rue the day that
President Clinton gave the green
light to the Iranians to play the
savior to the Bosnians, because there
is a significant Iranian influence
remaining in Bosnia. Sure the numbers
are down, but it is not the
quantity that creates the
difficulties, but rather the type of
presence and the influence they
wield.

“…The New York Times
of September 23, 1996, quot[ed] a
senior NATO official as saying, ‘[The
presence of Islamic mujahedeen in
Bosnia] is a time bomb waiting to go
off. These mercenaries are all well
trained, both as fighters and
terrorists. While they are
being kept under wraps now, the
moment they are given the order to
set off car bombs or carry out
assassinations, this whole mission
could go up in smoke…
‘”

“With the U.S. preparing to
keep our troops in the Balkans for
longer than originally promised by
the President — well into next year
— it cannot be doubted that with
reports like these, the risk of harm
posed to American citizens, and
American military personnel currently
serving in the Balkans, and about to
be deployed, cannot be
understated.”

In recent days, even the Clinton
Administration has been obliged — at
least implicitly — to acknowledge the
dangers represented by the continuing
influence of Iranian and other radical
Islamic forces Bosnia. For example,
today’s Washington Post reports
that the U.S. will not turn over $100
million worth of arms pledged to the
Bosnian Muslim-Croat federation pursuant
to the Dayton agreements until the
government removes from office the Deputy
Defense Minister Hasan Cengic — a wholly
owned subsidiary of Iran. The Center has
learned that this is only one of the
preconditions being stipulated by the
Clinton Administration before it releases
45 M-60 tanks, 80 armored personnel
carriers and fifteen helicopters that
arrived by ship in Croatia yesterday.
Others reportedly include: the firing of
the Defense Minister Vlademir Soljic and
the closure of the Bosnian Agency for
Investigation and Documentation — which
has become an Iranian-dominated secret
police organization used to terrorize
those who do not subscribe to the
political agenda of Bosnia’s radical
Islamic elements.

Watch This Space

Other ominous indications that the
Dayton Accords will not promote
a stable and durable peace in the Balkans
— to say nothing of the survival of an
integrated, multi-ethnic
Bosnia-Hercegovina — include the
following:

  • Municipal elections
    scheduled for next month had to
    be postponed to some unspecified
    date next year.
    This
    action was taken at the
    insistence of the Organization
    for Security and Cooperation in
    Europe (OSCE) in light of
    indisputable evidence that the
    consolidation of power by
    extremist Bosnian Croat, Serb and
    Muslim factions has reached a
    point where balloting cannot be
    conducted in a “free and
    fair” manner.
  • Interestingly, that was
    also true of the national
    elections
    for the
    collective presidency and
    parliament held last month. But
    postponing those elections — as
    was strongly recommended by most
    experts and diplomats monitoring
    developments in Bosnia — would
    have been inconvenient
    for the Clinton campaign’s claim
    to have brought peace to Bosnia.
    Indeed, the degree to which the
    OSCE has been made subservient to
    Administration dictates has
    caused some among its demoralized
    officials to suggest that the
    organization’s acronym now should
    stand for the “Office
    for Securing Clinton’s
    Election.”
  • Predictably, the national
    elections produced only more
    signs of the non-viability of the
    Dayton-promulgated governing
    institutions.
    The
    collective presidency has only
    met twice; the Serb
    representative Momcilo Krajisnik
    has made no secret of his
    contempt for the loyalty oath to
    a unified Bosnia that he only
    took under duress; and the
    Parliament has yet to meet in
    plenary session with all its
    ethnic groups represented.
  • The elections also served
    to underscore the fact that there
    is still no real freedom of
    movement in Bosnia and refugees
    are unable to return in safety to
    their homes.
    In fact,
    Bosnian Serb military units that
    have recently been trained by
    IFOR in de-mining procedures have
    reportedly applied their skills
    to booby-trapping and blowing up
    buildings in villages surrounding
    Brcko (e.g., Jasici) so as to
    deny them to would-be returning
    refugees.
  • The melding of Croat and
    Muslim forces in an integrated
    Federation army has substantially
    foundered
    on the grounds
    that the Croats profess fears
    about the radical Islamic
    elements in the Bosnian army.
    Meanwhile, U.S. leverage over
    Zagreb has been substantially
    reduced by the Council of
    Europe’s decision to welcome
    Croatia as a member nation —
    possibly encouraging Franjo
    Tudjman to believe that he can
    eventually seize the Bihac
    corridor he has long desired to
    improve his capital’s access to
    the Dalmatian coast. Concerns
    over Tudjman’s intentions were
    only intensified by his
    declaration on Croatian
    television this week that a
    unified Bosnian state is “a fantasy.”
    And
  • There has been a virtually
    complete failure to bring
    war criminals to justice
    .
    According to the Washington
    Post
    , the president of the
    international tribunal in The
    Hague has declared that he and
    his fellow judges were
    “prepared to pack up and go
    home” unless indicted
    suspects were arrested.

The Bottom Line

The fact that the Dayton
Accords are unraveling makes all the more
deplorable the Clinton Administration’s
failure to develop an “exit
strategy” for Bosnia.
As a
practical matter, its campaign-motivated
policy toward Bosnia-Hercegovina has left
the United States with two highly
unpalatable options: 1) The U.S.
can cut its losses
by
disengaging after the IFOR contingent has
been removed, virtually assuring that the
last vestiges of a Bosnian multi-ethnic
nation will go under. Such a step would
inevitably be perceived as a major blow
to what is left of American prestige and
leadership in international affairs and
amount to a humiliating write-off of the
more than $4 billion invested in Bosnia
peacemaking.

Alternatively, 2) the United
States will have to support the
open-ended deployment of as many as
40,000-60,000 troops on the ground

(with a substantial percentage American
forces) and perhaps as many as 20,000
international police in order to reduce
the chances of a resumption of
hostilities in Bosnia. It is unclear that
the American people will support such a
step — and the concomitant expenditures
required — especially if fears about
Islamic mujahedeen action against U.S.
personnel are realized.

Worse yet, if this Hobson’s
choice brought about by the Clinton
Administration’s mismanagement of the
Bosnia portfolio amounts to a lose-lose
situation for the United States, it is
likely to prove a win-win situation for
Iran.
In the event the Bosnian
government continues to mutate in a
radical Islamic direction effectively
under the protection of the United States
,
the Iranians and their ilk will
consolidate a strategic beachhead in
Europe of incalculable significance. On
the other hand, if the next phase of
Balkan genocide occurs upon the
withdrawal of U.S. and allied forces,
Iran stands to garner still greater
credit around the Muslim world — and
beyond — as the only reliable friend of
the victims of violence animated by
ethnic and religiously hatreds. Some
triumph for American diplomacy!

The American people are entitled to a
thoughtful debate about these issues —
and their implications. Will it be
allowed to occur before Election Day, or,
like so many other global flashpoints,
will the United States reap this bitter
harvest when there is no near-term
political recourse?

– 30 –

Wohlstetter — The Ultimate Pocket-Book Election Issue: Clinton Is Inviting Costly International Conflicts

(Washington, D.C.): The editorial page
of the Wall Street Journal
rendered a great public service yesterday
by publishing a seminal article by
Professor Albert Wohlstetter on the state
of the world — and its implications for
the United States in Election ’96, and
beyond. Dr. Wohlstetter’s
characteristically brilliant and
provocative essay concludes: “The
role of Mr. Clinton’s comprehensive peace
process in spreading pan-national
disorder and genocide should be the main
issue in the presidential campaign. It
affects our pocketbooks, our safety and
our conscience.”

Albert Wohlstetter is a certified
national treasure as a recipient (along
with his wife Roberta — a distinguished
national security analyst and author in
her own right) of the Presidential Medal
of Freedom. The Center for Security
Policy is also proud that Dr. Wohlstetter
accepted its “Freedom Flame”
award in 1993 in recognition of his more
than five decades of service to the
Nation’s public policy.

Albert Wohlstetter’s latest
contribution, entitled “The Cold War
is Over and Over and…” is but the
most recent evidence of his unparalleled
strategic vision and his courageous
willingness to speak truth to power,
however unwelcome it might be. While
his principal critique is reserved for
President Clinton’s reckless misconduct
of American security policy, Dr.
Wohlstetter also offers a scathing
assessment of the myopic view of some of
Robert Dole’s campaign planners who
insist that the Republican candidate
focus exclusively on the crime, drugs and
tax cut issues.

Perhaps the most telling insight in
the latter regard is his observation that
presidential mismanagement of the
U.S. national security and foreign policy
portfolios can have real and devastating
implications for the American economy and
electorate.
These implications
could well overshadow the benefits hoped
for from this tax plan or that
budget-balancing scheme; in fact, they
could wind up more than neutralizing
any such benefits. As Dr. Wohlstetter
puts it:

“Neither Mr. Clinton’s nor
Mr. Dole’s economic plan is likely to
show a clearly visible substantial
effect any time soon. Nothing like
the sudden and drastic effects of
potential wars. These might vary from
large world-wide oil shocks like that
of 1973 to the destruction of an
American city by a sea-launched
cruise or ballistic missile.”

The Center understands that
yesterday’s essay is intended to be the
first of a series by Dr. Wohlstetter
exploring at greater length specific
concerns about the likely strategic
repercussions of botched U.S. policies
concerning Iraq, the Balkans and Russia
and the former Soviet Republics. It
anticipates that these op.ed. articles —
like “The Cold War is Over and Over
and…” — should be considered required
reading for the entire American body
politic
.

– 30 –

1996 Freedom Flame Award: William J. Casey

freedomflame1996forbescaseyWilliam J. Casey was — to the enormous benefit of our nation — a man consistently ahead of his time. From his vital role as Chief of Secret Intelligence in Europe for the Office of Secret Services to his extraordinary stewardship of Ronald Reagan’s Central Intelligence Agency, Bill Casey’s strategic vision shaped several of the defining moments in America history. His passionate commitment to freedom–and the subtle, rarified strategies he used to help bring it to hundreds of millions of victims of fascist and communist repression–is one of the truly great stories of our time and why the Center for Security Policy is so honored to posthumously award him the Center’s 1996 ‘Freedom Flame’ award.

Bill came to accomplish his great feats for America’s security by a rich and varied background of senior positions in both the public and private sectors. Indeed, it was the highly successful merger of Bill Casey’s Wall Street and national security experiences that largely gave birth to the field of International Economic Security–the overarching theme of the Casey Institute’s work program and raison d’etre.

In the public sector, Bill Casey served as Chairman of the Securities and Exchange Commission, Undersecretary of State for Economic Affairs and President of the U.S. Export-Import Bank. He likewise served in pivotal positions for the election campaigns of both Presidents Nixon and Reagan. His pinnacle of effectiveness came during his six years as Director of Central Intelligence under President Reagan.

Bill was likewise a luminary in the private sector where he translated his Fordham and St. John’s degrees into an outstanding career in law and finance. He understood the uniqueness of the skills he possessed and undertook to share them through lecture series and many publications.

The blending of this extraordinary man’s life experiences made an incalculable difference in both restoring American power and prestige around the world and providing “early warning” for the coming abuses and security concerns associated with international trade, financial, energy and technology flows. For all of his distinguished service to our country and that of his proud family, it is a genuine privilege for us to honor William J. Casey with our 1996 Freedom Flame.

NEW INSTITUTE LAUNCHED WITH TRIBUTE TO BILL CASEY AS STEVE FORBES PROVIDES SEMINAL SECURITY POLICY ADDRESS

(Washington, D.C.): The eighty-third anniversary of William J.
Casey’s birth was the occasion of the birth of a new institution
in Washington that bears his name. The William J. Casey
Institute of the Center for Security Policy
has been
established with a generous grant by Mr. Casey’s family not only
to memorialize the legacy of this outstanding patriot, successful
financier, accomplished lawyer, dedicated public servant and
renaissance man. It is also intended, in important respects, to carry
on
that legacy into a future when the discipline he created
— one specializing in the intersection of international
economic, finance, technology, trade and energy developments with
national security policy — will be more needed than ever before.

At an elegant luncheon on 13 March 1996 at Washington’s ANA
Hotel, the Center posthumously awarded the former Director of the
Central Intelligence Agency its “Freedom Flame.” This
tribute recognizes individuals who have made significant
contributions toward the realization of political liberty and
free-enterprise and to the defense of freedom around the world.
Previous recipients have been: former British Prime Minister Lady
Margaret Thatcher
; Dr. Robert Krieble,
an accomplished industrialist whose generous philanthropy and
energetic personal efforts have done much to combat communism and
promote democratic capitalism in the former Soviet empire; and Dr.
Albert Wohlstetter
, one of the Nation’s most brilliant
and influential military strategists over the past five decades.

In attendance on this occasion were over 200 leading security
policy practitioners including: Ed Meese, Malcolm Wallop,
Jack Kemp, Jeane Kirkpatrick
and Richard Perle.
Former Attorney General Meese offered a moving testimonial to his
friend and fellow Reagan Cabinet member, Bill Casey. In it, he
recalled Mr. Casey’s distinguished war-time service in the Office
of Strategic Services, his remarkable career in business and
finance, his gifted authorship of numerous books and his loving
role as husband and father. Mr. Meese and all those present
remembered with great gratitude the Casey contribution to the
burgeoning of freedom made possible by the destruction of the
Soviet Union — and the strategies he skillfully employed to
bring about such an outcome.

Former U.S. Ambassador to the United Nations Kirkpatrick
presented Mr. Casey’s “Freedom Flame” award to his
widow, Sophia Casey, and her daughter, Mrs.
Bernadette Casey Smith
. Senator Wallop concluded the
proceedings with an uplifting tribute to William Casey in the
form of an eloquent toast.

The highlight of this event occurred, however, when Malcolm
S. “Steve” Forbes, Jr.
made a major address on
the global opportunities bequeathed by Bill Casey and his
colleagues to a new generation of Americans — and the challenges
that the successor generation will face as its predecessor passes
from the scene. Four pages of excerpts of
this extraordinary (and extemporaneously delivered) speech are
attached
as a service to policy-makers and private citizens
alike, who are sure in the future to require the moral compass
and intuitive grasp of the nexus of international economic and
national security policy that Steve Forbes, like Bill Casey
before him
, so clearly exhibits.