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US official 'given Taiwan slush money'

Leaked documents reveal America's chief policymaker on Asia, James Kelly, received money as head of a think-tank

By Lawrence Chung


TAIPEI - America's chief Asia policymaker, James Kelly, allegedly accepted donations from Taiwan for a think-tank he once headed.

The revelation is made in the latest leak from classified documents related to a slush fund which Taiwan established to finance its money diplomacy.

The exposures of such secret payments to key US politicians by the island's National Security Bureau (NSB) in the past week by Hongkong and Taiwan media has damaged Taiwan's image and hurt its exchanges with the United States, according to government officials and analysts.

'The exposure of these secret funds of the NSB has created a big problem to our diplomatic work,' said Foreign Minister Eugene Chien yesterday.

Taiwan's deputy representative to the US, Mr Tsai Ming-hsien, admitted that a number of semi-official and official exchange programmes between Taiwan and the US have been suspended.

But Mr Tsai said he was confident that future US-Taiwan relations would still remain good under the long-term strategic vision of US President George W. Bush.

In the latest spill, Hongkong's Sing Tao Daily, citing classified documents it obtained which carry the signature of former NSB Director Ting Yu-chou, alleged that the Pacific Forum, then headed by Mr Kelly, had regularly received donations from a slush fund supervised by NSB.

The Forum is under the Centre for Strategic and International Studies (CSIS), a Washington think-tank with close ties to the US military establishment.

Sing Tao alleged that former President Lee Teng-hui had asked the NSB to pay US$100,000 (S$184,000) to the Forum in February 1999 to support former Japanese Vice-Defence Minister Masahiro Akiyama's two-year study at Harvard University.

When Mr Kelly was made assistant secretary of state by Mr Bush in 2001, he ended his role as the Forum's president.

Mr Carl Ford, now US Assistant Secretary of State for Intelligence and Research, was a consultant for US PR firm Cassidy and Associates, when he allegedly donated funds to the Bush camp when the US president was running for office, according to Sing Tao.

The PR firm, which had received an annual payment of US$1.5 million from the slush fund, had been hired to lobby on behalf of Taiwan, Sing Tao said.

The paper said Mr Ford had made six contributions ranging from US$1 million to US$1.75 million to Mr Bush's camp and the Republican National Council between 1999 and 2000.


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Fallout from spy-case hits Washington

TAINTED LOBBYISTS: Recent revelations about secret NSB funds being used to influence US policy toward Taiwan may damage the nation's defenders in the US By Charles Snyder


Washington supporters of Taiwan are concerned that further disclosures from the National Security Bureau spy scandal could possibly taint those who speak up for Taiwan in the US capital, a senior Taiwanese politician has been told.

Presidential senior advisor Yao Chia-wen (姚嘉文) received that message during two days of talks with US think tanks and congressional aides during a stopover in Washington.

Fear of what's to come

While the congressional staffers were not concerned over what has been revealed so far about Taiwan's efforts to influence US political opinion with slush funds set up under former president Lee Teng-hui (李登輝), they say they may be increasingly concerned as new information, including the names of those involved, became public, Yao was told.

Yao was the first senior Taiwanese official to go to Washington and seek opinions on the scandal since it broke.

During his trip, Yao told reporters toward the end of his two days in Washington, he called his wife in Taiwan and was told that more details of the scandal were certain to come out. There was concern in Washington that the revelation of the names of the people involved would compromise intelligence sources.

Yao met with some conservative Taiwan-supporting congressional aides, but spent much of his time with conservative think tanks and others who are Taiwan's main supporters in Washington.

Congress is on a two-week spring recess, and virtually all Representatives and Senators are out of town back home, as are most of their staff members.

Think tank scholars voiced concern that as new names are made public, those who speak out in favor of Taiwan may be suspected of having "sold out" as potential recipients of some of the NT$3.5 billion in money allegedly set aside in two secret slush funds intended to buy political favors overseas.

As one person Yao met said, further disclosures could make some vocal Taiwan-supporters "radioactive."

So far, only the names of two officials of the George W. Bush administration have been publicly implicated in the scandal; Carl W. Ford, Jr., the assistant secretary of defense for intelligence and research and James Kelly, the assistant secretary of state of East Asia.

Ford, a former CIA official and senior defense official under the elder George Bush administration, was said to be an important Taiwan lobbyist who was allegedly wined and dined to the tune of NT$400,000 in late 1999 and early 2000 by the Lee Teng-hui administration. Although Ford is a republican, he is a native of Arkansas, former President Clinton's home state.

Kelly was alleged to have been involved in shuffling funds from Taiwan to Japan when he was head of the Honolulu-based Pacific Forum of the George Washington University's Center for Strategic and International Studies.

Friend under fire

Neither Ford nor Kelly would comment on the issue. Ford directed reporters to the State Department and a department spokesman said that while Kelly had read the articles implicating him, he had no comment.

Two months before Ford's alleged November 1999 trip to Taiwan described in an article in Hong Kong's Sing Tao newspaper (星島日報) earlier this week, which described the lavish entertainment Ford received, he wrote a letter to the editor of The New York Times in which he was described as a consultant for the Taiwan Research Institute, whose public relations firm, Cassidy and Associates, was a key lobbyist for increased US arms sales to Taiwan.

The letter, entitled "The One-China Myth," defended President Lee's insistence on "state-to-state" relations with China, rejecting China's insistence on a one-China principle.

In March that year, Ford testified before the Senate Foreign Relations Committee, with an extensive statement on cross-strait relations urging Congress to "lean on" the White House to support Taiwan's position.

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Copyright 穢 1999-2002 The Taipei Times. All rights reserved.

-- Cherri (, April 04, 2002

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