A U.S. high-tech firm bought in 1995 with Clinton-administration approval by a consortium that included two Chinese companies is proving to be a threat to U.S. national security, according to senior government analysts. The Anderson, Ind., based Magnequench Inc. was bought by the San Huan New Materials and Hi-Tech Co. of the People's Republic of China (PRC), which was started and still is partially owned by the Chinese Academy of Sciences in Beijing. It teamed in this venture with a Hong Kong investment house and a U.S. firm to form Magnequench International, which since has bought out at least one U.S. national laboratory spin-off company and has been project partner with another lab.

"The company is little more than a front for the PRC," a senior government analyst tells Insight. The official insists that the PRC owners of Magnequench are using its status as a U.S. company to obtain "state-of-the-art and emerging technology and transfer it to the PRC. … It's just another form of espionage."

Magnequench itself is a General Motors (GM) spin-off company that produces rare-earth permanent magnets that have practical uses in electric motors. But these magnets also are used in advanced military equipment such as magnetic bearings in high-performance gas-turbine engines and in permanent-magnet submarine-propulsion systems, and are a key component in missile-guidance systems. The concerns expressed by the senior government analyst are that the technology and equipment used to produce the permanent magnets here in the United States would not be allowed for export to the PRC. But, because Magnequench supposedly is a U.S. company owned partly by a Chinese company, there is no control over how the technology is used. And the source indicates the technology is being used to enhance the PRC's production capabilities. "They have already duplicated the existing manufacturing line in China," the source tells Insight.

The chairman of Magnequench is Hong Zhang, who also is chairman of San Huan. The company's president and chief executive officer, Archibald Cox Jr., tells Insight that he did not believe his Chinese partners posed a threat. "There is no story about China stealing technology," he says. Cox points out that since a recent realignment of the corporate structure, "San Huan's stake is only 20 percent now." He also acknowledges, though, that there was no wall of security protecting U.S.-developed technology from Magnequench's Chinese partners.

The senior government official says that the activities of Magnequench since the 1995 buyout by the Chinese companies point to an aggressive pursuit of U.S. high-technology in rare-earth permanent magnets. In 1998 Magnequench acquired a small company formed by the Idaho National Engineering and Environmental Laboratory (INEEL), a U.S. national laboratory. This company, GA Powders, was put together by two scientists who had developed an atomization process to aid in the production of high-tech neodymium-iron-boron permanent magnets while they worked at INEEL.

The U.S. national labs have been identified by U.S. counterintelligence as targets of PRC espionage attempts — especially the Los Alamos National Laboratory where the government says the theft of the nuclear W-88 warhead design occurred through a series of espionage efforts by the PRC.

The senior government analyst who is monitoring Magnequench says that by acquiring GA Powders the company has gained new technology developed at one of the nation's most important labs. "The Idaho lab is where some of the most exotic work is done on new materials, including ordnance and other materials used in advanced manufacturing. … It is a tremendous security issue." Indeed, in an internal newsletter the Sandia National Laboratory also has reported working on a joint project with Magnequench involving rare-earth magnets. The newsletter quotes a Sandia scientist involved in the project as saying, "Enabling aspects include advanced electrical controls [and] new magnet technology." The senior government analyst calls the project "a disturbing partnership."

In March 2000, Magnequench International announced that it would open "Magnequench Tianjin Co. Ltd., a new neodymium-powder plant, in Tianjin, China. This plant opening will locate the production of neodymium-iron-boron permanent magnetic powder close to the source of raw materials." The senior government analyst says this fits a pattern for the PRC: "They seem to be cloning whatever they do at Magnequench USA in China."

When the consortium composed of two PRC companies and one U.S. company teamed up to buy Magnequench in 1995, the deal had to be approved by the Committee on Foreign Investment in the United States (CFIUS). Chaired by the secretary of the Treasury, CFIUS is an interagency committee responsible for conducting thorough reviews of foreign companies attempting to purchase stakes in U.S. companies. Once notified of a foreign interest in a U.S. company, CFIUS determines whether the foreign interest would pose a threat to national security. The 1988 Exon-Florio provision to the Defense Production Act gives the president the authority to restrict a foreign company from investing in a U.S. company if it poses a national-security risk.

Such occasions are rare, but they do occur. In 1990, President George H.W. Bush ordered the state-owned China National Aerospace Technology Import and Export Corp. (CATIC) to divest its interest in the Seattle-based MAMCO Manufacturing Inc. CFIUS allegedly had approved the deal and CATIC already had taken over MAMCO when the president stepped in and gave CATIC 90 days to divest. After six months CATIC still had not sold its interest in MAMCO, so the Treasury Department placed the company in the hands of American trustees and restricted CATIC's access to the company until it could be extricated from its financial stake in MAMCO.

CFIUS would not discuss the MAMCO case or any other reviews it conducts, but a source who at the time provided the president with an analysis of the firm tells Insight that "even though MAMCO had no U.S. defense contracts" the machine tools in the MAMCO shop "could significantly increase the PRC's military capability." Five years after President George H.W. Bush ordered CATIC to divest its interest in MAMCO on the basis of a national-security threat, say well-placed sources, the Magnequench deal sailed right through the foreign-investment review process with only a few dissenters from the defense establishment. President Bill Clinton showed no interest in exercising his authority to order the Chinese company to divest Magnequench under the Exon-Florio provision initiated by Democrats in Congress.

"Magnequench is a greater threat" than MAMCO, says the senior government analyst. "The danger is manifold — it gives the Chinese the ability to produce very reliable servos and actuators." Servos are small, powerful motors "critical to advanced weapons systems." Another U.S. official tells Insight that the servos and actuators are used for "missiles, rockets and precision-guided bombs." The senior government analyst tells Insight that the Magnequench technology being transferred to China has a bifurcated risk: "It enables them to produce super-high-quality rare-earth magnets/ring magnets for use in gas centrifuges to produce nuclear-weapons material. And in addition to enhancing their own nuclear-weapons program we know that China has already proliferated ring magnets to Pakistan, which played a critical role in developing Pakistan's nuclear weapons."

In February 1996 the Washington Times reported that the CIA "has uncovered new evidence China has violated U.S. antiproliferation laws by exporting nuclear-weapons technology to Pakistan." It later was confirmed by Congress that military-industrial companies in China had sold 5,000 ring magnets to Pakistan.

Proponents of even more-liberalized trade with China often point to economic successes in joint projects which they say have pried open the bamboo curtain and promoted better relations with the PRC. Defense experts, on the other hand, point to China's nuclear-weapons program and related proliferation of weapons technology and say these relations may come at a higher cost to national security — and, in time, even of millions of lives.

Scott L. Wheeler is a reporter for Insight.
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FYI--Note the 'Full Court Press' the Chinese are running on this niche. Very thorough.

Magnetics Business & Technology Magazine

Magnetics: Industry Overview

China Mag 2002 confirms China's dominance in magnetic materials……

By Walt Benecki

On October 15-18, 2002, Intertech sponsored "China Mag 2002" in Beijing, China. Over 200 delegates representing 21 countries participated in the conference, which included three pre-conference workshops and concluded with a day of interesting research facility and factory tours.

The keynote address for the conference was delivered by Mr. Wang, Zheng-Xi, Chairman and President, Beijing ZhongKe San Huan Hi-Tech Co. Ltd. Mr. Wang reviewed the phenomenal growth of the Chinese Rare Earth magnet industry over the past twenty years. This industry has been demonstrating a growth rate of approximately 25% per year and in 2001, over 130 NdFeB magnet factories in China produced 7,800 tons of NdFeB magnets, replacing Japan as the leading producing country in the world. Numerous Chinese suppliers now routinely produce 40-45 MGOe products and ZhongKe San Huan is now in commercial production of N50 material.

Mr. Wang also reported that over 30 factories in China are now producing bonded NdFeB magnets and China's total output of these magnets has increased from 180 tons in 1998 to 620 tons in 2001. Mr. Wang concluded that China will not only be the largest magnet producing nation in the world, but will also be the largest consumer of magnets in the world. This status will not only be driven by China's large domestic consumer market, but by the massive transition of western production operations moving into China.

Archibald Cox Jr., President and CEO of Magnequench Inc. outlined his company's transition of NdFeB powder production to China and reported that Magnequench's new operation in Tianjin is in full operation and producing excellent and consistent quality NdFeB powder. Mr. Cox reported that he expected some segments of the magnet market to exhibit double-digit growth in 2002, particularly in Asia. Mr. Cox commented that western manufacturers cannot anticipate "business as usual" and that there will be continued pressure to re-evaluate business models, relocate, consolidate and otherwise achieve reduced cost structures. Mr. Cox also commented that, as certain NdFeB patents begin to expire in the next few years, patent issues may indeed become far more complex and challenging.

Mr. Terry Clagett, President and CEO of WebMagnetics Inc. attempted the daunting task of quantifying the worldwide supply, demand and pricing trends for hard and soft magnetic materials. Mr. Clagett concluded that the worldwide 2001 market for magnetic materials (excluding silicon steel) was $7.35 billion. Mr. Clagett suggested that an organization with international scope, such as The International Magnetics Association (IMA) might eventually develop a reliable data base of worldwide industry statistics. Mr. Clagett acknowledged the dominance of China in magnetic materials and concluded that, although many producers are laboring under the pressure of rapidly declining prices, "The magnet industry is alive and well".

Mr. Zhang, Licheng, Vice President of International Business, BGRIMM, reviewed the status of China's hard ferrite industry. Mr. Zhang observed that, in 2001, China accounted for over 33% of the worldwide production of sintered hard ferrite magnets. Over the past 20 years, China's hard ferrite production has enjoyed an average growth rate of 9.2% per year. Growth has actually accelerated in the 1990's to about 13% per year. Mr. Zhang observed that China now dominates speaker ring production and he predicted a similar trend will occur for hard ferrite motor arcs in the next 3-5 years.

Mr. Zhu, Mingyue, Vice President & General Manager, Rhodia China summarized the status of China's rare earth oxide industry, representing 170 plants that produced approximately 180,000 tons of rare earth oxide in 2001. Mr. Zhu reported on a planned industry restructuring that has the following four objectives: (1) Improved control of upstream raw materials, (2) Achievement of better economic scale of production, (3) Increased price levels, and (4) A move toward the high end of the rare earth value chain. This restructuring is not fully endorsed by all production groups, therefore its transition is likely to take a number of years to fully implement. Mr. Zhu forecasted that the rare earth industry will likely grow over 10% per year as compared to China's anticipated GNP growth rate of 7%.

Mr. Wang, Jue, Director, Jinning Sanhuan Hi-Technology Magnetic Industrial Co. reported on the rapid development of China's soft ferrite industry. Mr. Wang predicted that China will achieve manufacturing superiority in soft ferrite production. Indeed, this segment of China's magnetic materials industry is currently experiencing explosive growth, with production doubling from 30,000 tons in 1995 to 60,000 tons in 2000. In 2000, China's production mix was 40,000 tons of MnZn, 15,000 tons of MgZn and 5,000 tons of NiZn materials. Mr. Wang discussed the industry's progress in developing lower power loss and higher permeability products. He felt that significant quality advancements are now assured since Baosteel adopted the Ruthner process during the mid-1990's for the production of high quality desilconized iron oxide.

An informative presentation was delivered by Mr. John Nellesson, President, All Magnetics, entitled "Why Not Start a Magnet Factory in China?" Mr. Nellesson outlined, in considerable detail, the procedures, challenges, costs and risks associated with establishing a wholly-owned foreign enterprise in Mainland China.

Mr. Xiao, YaoFu, from Beijing Kequang Magnetic Material Co. Ltd., provided an update of his company's development of anisotropic NdFeB powders for bonded magnets. Mr. Xiao reported on a "NdFeBCoZrGa" material that exhibits lower irreversible losses and reduced temperature coefficients when compared to basic NdFeB HDDR material. Beijing Kequang is currently in a pilot plant stage of development and expects to be in commercial production with a capacity of 100 tons per year by 2004.

Finally, an excellent overview of China's soft magnetic alloy industry was offered by Mr. Chen, Wenzhi, Advanced Technology & Materials Co. (ATM), Amorphous Product Division. ATM is the dominant producer of amorphous ribbon in China, with an annual capacity of 1,000 tons and the capability to produce ribbon up to 220 mm wide. China's total output of amorphous products increased from under 200 tons in 1995 to over 900 tons in 2000. Mr. Chen predicted that China's production and utilization of both amorphous and nanocrystalline materials will grow very rapidly over the next five years.

Walt Benecki is the former president of Group Arnold and a past president of the Magnetic Materials Producers Association. Walt has established a consulting practice specializing in operations management, industry analysis, acquisitions, dispositions and strategic alliances. Contact him at waltbenecki@aol.com.

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A Tale of Two Medias

70% of America gets it's news by watching TV

Date	Major China Related Event	TV Network Coverage of the Event
Summer 97	Hearings covering RNC. Republican National Committee Chairman Haley Barbour appeared before the Senate Governmental Affairs Committee to address Hong Kong-connected contributions to an RNC think tank	The networks provided their fullest day of hearings coverage that month, with the exception of the opening day.
09/09/97	Hearings covering DNC. Democratic National Committee Chairman Don Fowler appeared to answer questions about his favors for foreign donors	No network coverage
04/04/98	Loral's Loose Lips New York Times reporters Jeff Gerth and Raymond Bonner reported, "A federal grand jury is investigating whether two American companies illegally gave China space expertise that significantly advanced Beijing's ballistic missile program, according to administration officials. But the officials said the criminal inquiry was dealt a serious blow two months ago when President Clinton quietly approved the export to China of similar technology by one of the companies under investigation."	Six weeks went by without a single word from the networks, until the Johnny Chung allegations were published on May 15. As President Clinton prepared to visit China at the end of June, the networks stayed similarly silent.
05/15/98	Chung's Chinese Summer. The New York Times reported Johnny Chung told investigators that a large part of the almost $100,000 he gave Democrats in the summer of 1996 came from Liu Chaoying, who works on defense modernization for China's People's Liberation Army.	ABC devoted 75 seconds to the story, CBS 27, and NBC 15.
05/17/98	Two days later, the Times added that Clinton overrode then- Secretary of State Warren Christopher's decision to limit China's ability to launch American- made satellites on Chinese rockets	After Sunday's disclosures, ABC reported one story, but CBS and NBC ignored it.
06/11/98	Bush Basher's Reverse. Washington Post reporter John Mintz revealed, "Months after denouncing President George Bush in 1992 for coddling ‘familiar tyrants' in Beijing, newly inaugurated President Clinton endorsed his predecessor's policy in 1993 by approving deals with China to launch U.S.-made satellites. Clinton took the action, the first of many favored by U.S. companies, despite evidence that China had sold ballistic missile parts to Pakistan, declassified White House documents show."	Zero. The only network morning or evening mention of the satellite scandal in June came on NBC's Today June 11. Claire Shipman did not touch on the Mintz story.
06/13/98	New Communications Skills. New York Times reporter Jeff Gerth found: "For the past two years, China's military has relied on American-made satellites sold for civilian purposes to transmit messages to its far-flung army garrisons, according to highly classified intelligence reports. The reports are the most powerful evidence to date that the American government knew that China's army was taking advantage of the Bush and Clinton administrations' decisions to encourage sales of technology to Asian companies."	Zero
06/15/98	Pakistan Proliferation. Washington Times reporter Bill Gertz found White House documents showed Clinton loosened the Bush export-control policy by allowing a November 1993 satellite launch while sanctions were in place for exporting missile parts to Pakistan: "Congressional investigators said the document, released last week by the White House, contradicts recent statements by Clinton administration officials defending satellite export policies and claiming they were following procedures set by the Bush administration."	Zero
06/16/98	Helping Libya and Iran. Bill Gertz added more in the Washington Times: "China is discussing sales of missile test equipment to Iran and is helping Libya develop its own missile program, The Washington Times has learned...The reports contradict administration claims that Beijing has improved its record on weapons proliferation."	Zero
06/18/98	The General's Son. Jeff Gerth reported in The New York Times that the Clinton administration was rethinking its approval of one of the largest satellite deals to that date: "Administration officials said concerns about the pending satellite sale had been deepened by American intelligence reports about Shen Rongjun, the Chinese Army general who oversees his country's military satellite programs. The reports quote the general as saying he planned to emphasize the role of satellites in gathering information."	Zero
06/24/98	The Missing Circuit Board. The New York Times reported that China barred American monitors from a previous rocket crash site: "When the Americans finally reached the area and opened the battered but intact control box of the satellite, a supersecret encoded circuit board was missing."	Zero
10/19/98	"Chinese Said to Reap Gains in U.S. Export Policy Shift" Announced the top of the fold, off-lead of Monday’s New York Times. Reporter Jeff Gerth and Eric Schmitt detailed how Clinton’s decision to relax export rules, made after he met high-tech executives who later contributed to the DNC, "enabled Chinese companies to obtain a wide range of sophisticated technology, some of which has already been diverted to military uses."	10/20, Good Morning America and This Morning all skipped it Monday morning. Monday night: Not a word on the ABC, CBS, CNN, NBC or FNC evening newscasts.
12/30/99	Cox Report Released On Wednesday a special select House committee of five Republicans and four Democrats released a unanimous report which concluded that U.S. technology deals with China have boosted the accuracy of their missiles and harmed America’s national security.	Of the broadcast networks, only CBS considered it worth a full story. ABC’s World News Tonight gave it a piddling 22 seconds and NBC Nightly News allocated a mere 26 seconds. FNC and CNN also provided full stories, but only FNC reminded viewers that Loral’s Chairman donated $100,000 to Democrats just before his company earned a technology transfer waiver.
03/06/99	Miniaturized Multiple Warheads. The New York Times landed another shocking scoop: "Working with nuclear secrets stolen from an American government laboratory, China has made a leap in the development of nuclear weapons: the miniaturization of its bombs." The Times emphasized "The White House was told of the full extent of China's spying in the summer of 1997, on the eve of the first U.S.-Chinese summit meeting in eight years — a meeting intended to dramatize the success of President Clinton's efforts to improve relations with Beijing....a reconstruction by The New York Times reveals that throughout the government, the response to the nuclear theft was marked by delays, inaction and skepticism — even though senior intelligence officials regarded it as one of the most damaging spy cases in recent history."	In the first nine days of the story, the Big Three aired only 11 evening stories. The morning shows were worse, airing only six full news reports and one interview in the first ten mornings. As administration spokesmen went uninterviewed and unchallenged by the morning shows, ABC's Good Morning America had time for a half-hour on weight loss. CBS's This Morning asked O.J. Simpson lawyer Johnnie Cochran about his upcoming appearance on the CBS soap Guiding Light. Two networks urgently discussed the 40th anniversary of the Barbie doll. When the networks did touch the story, it came flattened by skepticism. Only NBC's Today aired an interview. On March 9, Katie Couric helped Energy Secretary Bill Richardson make excuses: "Isn't there a possibility that China could have done this on its own?" Since the first ten days, the Big Three have ignored several significant revelations:
03/24/99	Hand the Spy a Better Job? New York Times reporter James Risen revealed: "In spring 1997, Los Alamos National Laboratory chose a scientist who was already under investigation as a suspected spy for China to run a sensitive new nuclear weapons program, several senior government officials say. The scientist, Wen Ho Lee, asked that he be allowed to hire a research assistant, the officials said. Once in the new position, in charge of updating computer software for nuclear weapons, Lee hired a post-doctoral researcher who was a citizen of China, intelligence and law- enforcement officials said....the research assistant has disappeared."	Zero
03/29/99	"The Penetration is Total." Submerged across the bottom of two pages of the March 29 issue, Newsweek correspondents John Barry and Gregory L. Vistica reported on a CIA probe of the compromised nuclear labs. Top nuclear experts "practically fainted" at how Chinese scientists routinely used U.S. lab phrases and concepts. One official announced: "The penetration is total...they are deep, deep into the labs' black programs." They also learned "Beijing recently got hold of two U.S. cruise missiles that failed to detonate during last fall's retaliatory attack on Osama bin Laden in Afghanistan," and officials want to know if the Chinese are copying that sophisticated technology.	Zero
03/31/99	Only Lee's Wiretap Rejected. After several investigative news reports on the China connection by the Washington bureau of Investor's Business Daily, the newspaper's lead editorial on March 31 revealed: "As part of the probe, the [FBI] requested a wiretap on Lee. Justice denied it, arguing it did not have sufficient grounds to take to a federal court to get the tap approved. But a look at the Justice Department's record on wiretaps calls that argument into serious question. From 1993 to 1997, federal officials requested 2,686 wiretaps. For all its concern for probable cause and legal standards, the Justice Department turned down one request in those four years — Lee's in 1996."	Zero
04/04/99	Chung's $300,000 Link to the Top. The Los Angeles Times published an Easter bombshell. "The chief of China's military intelligence secretly directed funds from Beijing to help re-elect President Clinton in 1996, former Democratic fundraiser Johnny Chung has told federal investigators."	Nothing on any Big Three morning or evening show. ABC's Sam Donaldson got closest to touching the revelations five days late, reporting without even a raised eyebrow that Zhu "said he had no knowledge that the Chinese government had contributed money to Mr. Clinton's 1996 campaign."
04/08/99	New Neutron Theft. New York Times reporters Jeff Gerth and James Risen began: "In early 1996, the United States received a startling report from one of its Chinese spies. Officials inside China's intelligence service, the spy said, were boasting that they had just stolen secrets from the United States and had used them to improve Beijing's neutron bomb, according to American officials." After repeated administration claims that all nuclear-weapons espionage happened in the mid-80s, the Times found espionage happening in 1995.	In a press conference that day with visiting Chinese premier Zhu Rongji, both the AP and Reuters reporters on hand asked about the Times charges. Still, the CBS Evening News ignored the story, except for one vague reference by Bill Plante: "Did China steal U.S. nuclear technology? Zhu Rongji said he didn't know a thing about it." ABC and NBC covered the subject, though NBC did not give credit to the newspaper and concluded by stressing the White House spin that "there's no evidence China's neutron bomb was improved as a result." The next morning, CBS's This Morning ignored it. ABC's Good Morning America gave the Times story two updates totaling 30 seconds, and NBC's Today awarded one 38-second brief. But NBC spent two minutes and 43 seconds on beavers gnawing down cherry trees on Washington's Tidal Basin.
04/28/99	Huge Computer Transfers The New York Times reported "A scientist suspected of spying for China improperly transferred huge amounts of secret data from a computer system at a government laboratory, compromising virtually every nuclear weapon in the United States arsenal, government and lab officials say."	ABC's World News Tonight aired a full story. CBS Evening News mentioned it before its own exclusive report on nuclear lab security. CNN's The World Today aired two reports. But NBC aired nothing.
04/29/99	Richardson Responds In response to the Times, Energy Secretary Bill Richardson gave an interview to The Washington Post admitting "a serious security breach that is unconscionable." The front-page Post article reported that Richardson signaled the possibility that Lee "may have made available to China far more sensitive information than previously imagined," including during the Clinton years.	Zero
04/30/99	Freeh Under Fire The Washington Post front page reported that Congress "erupted" with criticism against the FBI and the Justice Department. "After grilling FBI Director Louis J. Freeh for nearly three hours in a closed-door hearing, members of the Senate Select Committee on Intelligence from both parties appeared equally outraged at what they depicted as lax handling of past and present investigations into suspected leaks of classified data. Their concern was aroused in particular by Freeh's testimony that the suspect, Wen Ho Lee, had been cited for suspicious actions going back almost 20 years."	Only CNN aired a story on the hearing.
05/02/99	Administration Knew About Espionage The New York Times added new details about when the Clinton team learned about espionage: "A secret report to top Clinton administration officials last November warned that China posed an 'acute intelligence threat' to the government's nuclear weapons laboratories and that computer systems at the labs were being constantly penetrated by outsiders."	Only ABC noted it, for 40 seconds.
05/07/99	The Senate Reports. Washington Times reporter Bill Gertz summarized a bipartisan congressional finding of damage that was released later that day: "U.S. satellite technology transferred to China in 1995 and 1996 has improved Beijing’s rockets and missiles, according to a report to be released May 7 by the Senate Select Committee on Intelligence. The bipartisan committee report sets out that the Chinese government is engaged in a covert operation aimed at influencing U.S. policies. ‘Technical analyses and methodologies provided by American satellite companies to the [People’s Republic of China] during various satellite-launch campaigns result in the transfer to the PRC of technical knowhow,’ the report says. ‘Such transfer enables the PRC to improve its present and future space launch vehicles and intercontinental ballistic missiles.’"	Zero Although ABC’s World News Tonight aired a story on Wen Ho Lee’s claims of innocence.
05/09/99	Richardson: China Did Steal Secrets On NBC’s Meet the Press, moderator Tim Russert prodded Energy Secretary Bill Richardson to admit that contrary to Clinton’s press-conference claims, espionage did take place in the Clinton years: "In November of ‘98, you received, the President received a report saying exactly something contrary. Senator Kerrey, Senator Shelby of the Intelligence Committee said they were aware and the President was aware. Why would he tell the American people in March that he wasn’t aware?"	Zero Despite this heated exchange, NBC and the other networks failed to report Richardson’s admission on their morning or evening shows, even though it made the front page in the next day’s Washington Times, and even The Boston Globe.
05/10/99	Scott-Free Peter Lee. New York Times reporters Jeff Gerth and James Risen expanded the espionage story: "A scientist working on a classified Pentagon project in 1997 provided China with secrets about advanced radar technology being developed to track submarines, according to court records and government documents. Submarine detection technology is jealously guarded by the Pentagon because the Navy’s ability to conceal submarines is a crucial military advantage."	Zero
05/14/99	"China is close to deploying a nuclear missile with a warhead whose design draws on stolen American secrets, United States intelligence officials say," the New York Times revealed in a front page story on Friday. The Times added: "Officials say that also means China may soon be using secrets stolen from the United States on weapons capable of a significant range that could include Europe, Asia and possibly the western United States."	A 12-second item on Today, ten seconds on Good Morning America, zilch on This Morning and not a word on the three broadcast network evening shows which were too busy looking at record snowfall on a mountain and waiting lines for Star Wars movie tickets.
Sources: Nets Skip How Missile Made with Stolen Info, Media Research Center, Cyber Alert, 12/31/98 All The News That's Fit to Skip, Media Research Center, Tim Graham, 05/14/99 ABC & NBC Shunt Technology Transfers to China, Media Research Center, Cyber Alert, 12/31/98 China Military Gains Thanks to Clinton; Justice Before Microsoft, Media Research Center, Cyber Alert, 10/20/98

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