Cox Reports

Rep. Christopher Cox talks about his committee's report on Chinese espionage, his long-term campaign for budget reform, and the connection between freedom and encryption.

Since coming to Congress in 1988, Rep. Christopher Cox (R-Calif.) has been a hard man to pigeonhole. When he talks about taxes, government bloat, and the defense of freedom, he sounds like the man he served as a White House counsel, Ronald Reagan. When talk shifts to the policy intricacies of the federal budget or tort reform, Cox's Harvard Law School and MBA background peek through. When he works on cyberspace issues–a moratorium on Internet taxes, a free speech alternative to the Communications Decency Act–he's the entrepreneur who went online in the mid-'80s. (That business translated Pravda into English, reflecting Cox's anti-communism and his interest in foreign relations.)

Nor has Cox limited himself to high-profile issues. In the early '90s he took up the cause of Lithuanian independence, traveling to Russia in 1991 to deliver a speech on freedom–in Russian. Cox's efforts helped focus world attention on the tiny Baltic state at a time when it was not at all clear if Moscow would accede to independence or roll tanks. In May 1998, Cox was presented with the Order of the Lithuanian Grand Duke Gediminas, the highest honor the Republic of Lithuania can give to a living noncitizen.

In the spring of 1998, then-Speaker Newt Gingrich was looking for someone to head a select committee investigation into technology transfers to the People's Republic of China. Given the campaign finance scandals of 1996, China was a hot topic, requiring some tact if the enterprise was to do anything except dissolve into partisan squabbling. Every other congressional investigation in the Clinton era had ended that way. The committee also needed someone capable of attending to details inside a very large picture. Few could have foreseen what the Cox panel would find.

In a few months the select committee found evidence of the theft of U.S. nuclear secrets by China stretching back decades. Further, it found that the Clinton administration's safeguards against the transfers of advanced military technology to China had been lax or nonexistent. Significantly, every Democrat on the panel signed on to the conclusions, and no minority report taking issue with the findings was generated.

Although the final report was given to the Clinton administration on January 3, the public got a look at the findings after months of delay–and once impeachment was safely in the national rearview mirror. The full report probably will never be released. Administration concerns about exposing U.S. sources of intelligence are the official reason.

Following the release of a declassified version of the report, Cox found himself very much in demand to explain what his committee had found. It was a big boost in visibility for a member often described as "thoughtful" or "cerebral," peculiar Washington epithets referring to someone smarter than the reporters who cover him.

In the attention deficit world of the Beltway, the "Cox report" brought him back into the national spotlight. Only months earlier Cox had suffered a political setback when he had to quickly fold his bid to become speaker after it was clear he did not have the votes. He remains the chairman of the House Republican Policy Committee, a key leadership slot which helps shape the GOP agenda.

Cox sat down with Washington Editor Michael W. Lynch and Reason Express writer Jeff A. Taylor in early June, as he was busy passing an amendment to the Pentagon budget which requires the administration to report to Congress by November on the status of China's missile technology.

Reason: This report has been a model of bipartisanship. How did you achieve it?

Christopher Cox: There were two [factors]. The first is that the members were handpicked, on both the Democratic and Republican sides. They were selected for a serious commitment to hard work, their willingness to use discretion in sensitive areas, their expertise, and their sound judgment. Put another way, the variation about the mean that one normally sees among politicians was quite narrow here.

The second difference was the subject matter. It was much easier for us all to decide to be on the same team than if we were working on taxes or spending or the usual things that divide liberal from conservative, Republican from Democrat. The question before us was the extent to which United States national security was undermined by transfers to another country that, whatever one may think of it, certainly does not always have America's best interest foremost in mind. As a result, we all decided early on that we were not going to be on the Republican or Democratic team but the American team.

Reason: What caused the bipartisanship to break down after the report?

Cox: The reason that our report was unanimous was that we stuck to the facts. Because the facts spoke so loudly for themselves, there was no need to spin the report with inferences. But anyone reading the report will be led to his or her inferences very rapidly. Once the report was published, demands were made for the resignation of the attorney general, the national security adviser, and others. Apparently there will be significant firings in the Department of Energy. The Clinton administration is under fire–that has changed the political calculus.

Reason: Have you been happy with the way this report has been received by the media?

Cox: It has been received well throughout the country, including on television, and indeed it's received positive press throughout the world. The one pocket of negative press has been the Los Angeles Times. It looks a hell of a lot more like The People's Daily. One can read the People's Daily party line on the Internet. About a day before The People's Daily said our report was racist, the Los Angeles Times wrote an article saying this was breeding racism. It is an astonishing charge, inasmuch as I have been working for 11 years with the democracy movement in the People's Republic of China.

Reason: It seems that some Chinese Americans are taking the report as anti-Chinese or anti-Asian. Should Republicans be on guard for this type of thing?

Cox: Because you probably read the Los Angeles Times, that is a reasonable inference. That is an intentional manufacture, however, of the People's Republic of China, which has been pushing the line that to oppose Communist Party policies is to be racist. The [op-ed] piece I wrote with Wei Jingsheng in the Los Angeles Times addressed that directly. Wei Jingsheng founded the Democracy Wall Movement and is the most revered of China's dissidents. He has spent most of his life in prison and is still under exile.

What we said in that piece is that the people in the laogoi slave labor camps are Chinese, that the people who are victimized by the show trials are Chinese, that the people on the receiving end of the missiles deployed on the Taiwan Strait are Chinese. It is outrageous to think that if you are on the side of freedom for the Chinese people and opposed to communism that you are anything but pro-Chinese.

Reason: Your report has been criticized by a foreign policy analyst at the Cato Institute for exaggerating the threat Chinese espionage poses and therefore being a version of the age-old Washington practice: Hype a problem and propose a government solution. Why use the worst-case scenario?

Cox: I am always troubled when I find myself in disagreement with someone at Cato. If the object is to spend less on defense, we would be wise to make sure that we are not spending U.S. taxpayer dollars to arm our potential opponents. Our recommendations in here are quite modest. A great deal of our report is simply to have the scales fall from our eyes so we know what we are dealing with.

It is not a worst-case scenario. Some of the Democratic signers of the report claim a [particular] sentence represents a worst-case scenario. The sentence they refer to is the date on which in 2002 a new intercontinental ballistic missile will be fielded with a warhead featuring particular U.S. designs. It takes their remarks out of context to say that ["a worst-case scenario"] refers to other sections of the report.

What is included in the report is only what we know to a certainty. We don't know, for example, what the PRC has stolen, except those things that have virtually fallen into our lap. Our human intelligence inside the PRC is very scarce. By all accounts we know precious little what is going on inside the PLA, the Communist Party, and the various institutions of the state.

Not only is the report fair, but it is intended that people will make their own inferences about where to go from here and what to do. If Cato wants to go one direction and Brookings wants to go in another, that's entirely predictable. What I would object to is someone trying to win the argument by saying that these are not facts, because they are.

Reason: Another basic critique has come from Cato and other places. It says, "They haven't got that much and what they did get they can't use" and, "Keep in mind that we have 30,000 nuclear weapons, while they have a few hundred."

Cox: There are several arguments there. First, "they didn't get much." Start with our most sophisticated nuclear warhead, the W-88 that goes on the Trident D-5. They successfully tested their version of W-88. They got it right, and all we can say in an unclassified way is, [they did so] "virtually immediately." In the classified report, we say just how fast that was.

It took us decades and hundreds of nuclear tests. They have built and successfully tested that weapon. They have built and successfully tested the neutron bomb, the W-70 warhead. So if they can build and successfully test a weapon without doing the preliminary work, it means they stole the design.

Reason: Is it something they could not have possibly spent enough money to acquire any other way, given the state of their economy and defense budget?

Cox: It would have taken them many, many more years to accomplish. It isn't merely a matter of money–it requires time, unless you can steal the answers. And time for us is more important. We are not so much trying to get them to spend their money as we are trying to put off any advances they might make that threaten the regional security.

Reason: The Chinese made a great show recently of being able to get some warhead information off of public Web sites. How does that kind of information differ from what you believe they stole?

Cox: You can't build a nuclear weapon based on it. They successfully built and tested these weapons. Therefore you know that [publicly available information] is not what they got.

Reason: The White House spin, which was picked up by many news organizations, is that this espionage is a long-running problem dating back for at least three administrations. In your estimation, how much blame is borne by the Clinton administration?

Cox: Our report states that the magnitude of the problem was not known until 1995. As a result, the critical time period has been the last four years. Questions properly have been raised over whether the response has been adequate. I am outraged as chairman of this select committee that Congress was kept so much in the dark. Sitting to my left during our 34 hearings was the ranking Democrat on the Intelligence Committee; sitting to my right was the chairman of the Intelligence Committee. I guarantee you, because I saw the looks on their faces and heard the anger in their voices, that they had never heard these things before.

Reason: Why hadn't they? National Journal notes that "the sheer breadth of the security lapses, misguided policy shifts, and negligence by U.S. agencies just since 1992 strains the logic of the official explanation: that it was all the result of many separate and coincidental instances of bureaucratic incompetence." What accounts for the Clinton administration's failure to pay more attention to Chinese espionage and report it to you in Congress?

Cox: I asked Jim Woolsey, who was President Clinton's first CIA director, how interested President Clinton was in the problems of espionage by the PRC. How much time did the president take to learn these things? I was told that the sum total of time that the director of central intelligence briefed the president–not just on China but on the rest of the world–during his entire tenure was two hours. This is compared to President Reagan who had a briefing every morning.

Reason: President Clinton later on did seem very interested in China, particularly in making domestic connections with Chinese who helped fund his soft money presidential campaign. What role, if any, do you think these political connections played in his lack of interest in national security threats from China?

Cox: No one who watches television would think that President Clinton isn't concerned about gun control. Why then would he meet with Wang Jun, a notorious arms dealer whose company at that very time was under indictment for smuggling over 2,000 AK-47s into San Francisco?

Reason: When did he meet with him?

Cox: That was at one of those notorious coffees in 1996.

Reason: Why did the campaign-contribution connection fall out of the report?

Cox: It did not. We included all of the original material we were able to generate on those points. And specifically the dots that had heretofore been unconnected are now a bright red line leading directly from PLA military intelligence to the 1996 campaign.

Gen. Ji [Shengde], who is the head of the Military Intelligence Division of the People's Liberation Army, met with PLA Col. Liu [Chaoying] and [Democratic Party donor] Johnny Chung in Hong Kong. It was agreed that $300,000 would be wired to Chung three days later. That amount of money was wired from Col. Liu's account at Citibank to Chung's account in Hong Kong. On that same day, $300,000 was wired into Colonel Liu's Citibank account from CITIC [China International Trade and Investment Company, headed by Wang Jan and described in the Cox report as "the most powerful and visible corporate conglomerate in the PRC"] Industrial Bank. CITIC is described in rich detail in our report.

Beyond this, we included in our report, for the first time for the American public, information about the possible connection of Charlie Trie to bribery scandals involving the PRC government and satellites manufactured by Hughes for foreign launch in the PRC. We also attempted to include in the unclassified version of the report, but included much more in the classified version, information on [former Commerce Department official and Democratic Party fund-raiser] John Huang's access to classified information, which was extensive. And his maintenance of an office a few blocks away, unbeknown not only to his boss at Commerce but also to his secretary, where he had constant telephone and fax contact with the Lippo Group. And we described the Lippo Group's affiliation with China Resources, a known [Ministry of State Security] front.

We also had a number of witnesses who took the Fifth Amendment and/or fled the jurisdiction. A reason we did not expand further beyond what other House and Senate committees have done in the area is that we ran into the same brick walls in terms of cooperative witnesses.

Reason: A third of the report is still classified. According to some news reports, much of what's classified has to do with the later years. Were you happy with the negotiations with the Clinton administration over how to unclassify the document?

Cox: I am very concerned that some of the information that ought to be out for people to make policy judgments is not out. This is particularly true in the area of the very recent export of high-performance computers to particular end users in the People's Republic of China. But the deletions were made in order to protect sources, and second-guessing the representations of the intelligence community on that score is a matter of life and death.

Reason: Has the public taken this problem seriously enough?

Cox: We have seen a sea change in the approach to national security matters involving the PRC. No one gave it a second thought a year ago. In fact, a year ago most Americans did not even know that during the 1990s for the first time the PLA deployed an entire force of CSS-4 intercontinental ballistic missiles that target the entire continental United States, from Los Angeles to New York and everything in between. I'm pleased with the progress we are making.

Reason: How do we need to adjust our strategic thinking?

Cox: There has been manifest change in the PRC's approach to geopolitics since 1991. The Communist Party has decided to fill the void left by the collapse of the Soviet Union. It has aligned itself with opponents of the United States around the globe. It is stitching together an alliance of misfits. It is engaging in extensive military cooperation with Russia.

One of the main objects of our China policy over the last several decades was to prevent military cooperation between the Soviet Union and the PRC. The Clinton administration's current China policy is producing as one of its most significant results military cooperation between the PRC and Russia. That cooperation, incidentally and importantly, is not in Russia's national interest. Almost no one in Russia thinks it's in Russia's national interest. But the reason it's happening is because massive hard currency reserves in PRC are being used to bribe individuals who are willing to sell the crown jewels of Russia's military.

Reason: The PRC comingles its commerce and defense in order to obtain classified information. You're a supporter of normalizing trade relations with China. Explain why.

Cox: I just mentioned that the hard currency surplus that the Communist Party can lay its hands on is a source of mischief. It's an attractive nuisance vis-à-vis Russia. It is used to purchase military equipment from Europe or Israel. The hard currency surplus is simply the other side of the equation from the trade deficit we hear so much about. If instead of them selling us four times more than we sell them, we were able to make some sales in China of couches, refrigerators, phones, and so on, then they would have a better merchandise balance and less of a hard currency surplus. That's in our national security interest.

I am not one–and I want to emphasize this–who thinks from an economic standpoint that there is any need to have balanced trade with every nation all around the planet. That's absurd. The trade deficit in and of itself is not threatening. In this particular case, one of the things it means in real life is that there's a hard currency surplus for the PRC.

Reason: So you see normalizing trade relations with them as a way for us to export them more real goods, and therefore less currency, and therefore serve our national security interests?

Cox: After all, they are selling us Beanie Babies. They are not selling us nuclear weapons. A mutual trade relationship would have us selling nonthreatening things as well.

Reason: In your mind, what's the difference between trying to stop the flow of encryption technology from the United States to other countries and halting the flow of other advanced technology?

Cox: First, nuclear warheads are not dual use, and encryption technology is. Second, with encryption technology, the question is, How realistic is the U.S. government's position? How realistic is it for us to think that there's a national security benefit in attempting to control the uncontrollable? It is uncontrollable at the level we are trying to control it. U.S. citizens need protection against spying by foreign governments, and encryption is one of the protections.

Reason: So the standard argument that we can't let out encryption technology because terrorists will get it doesn't, or at least shouldn't, enter into this debate.

Cox: I don't mean to suggest that there aren't arguments against encryption. But I spent half a year in classified hearings taking testimony under oath from officials from the National Security Agency, the CIA, the FBI–the entire intelligence community of the Clinton administration–and I left that experience being utterly unpersuaded of the Clinton administration's position on encryption [which prohibits exporting strong encryption software].

Lin Hai is a software designer in jail in the PRC now because he sent e-mail addresses from the PRC to an anti-communist group in the United States. The MSS [Ministry of State Security] would not have been reading his e-mail if he had had commercially available encryption technology. We have to keep our goal in mind. And our goal is getting rid of the communist state and instituting liberty. Not getting rid of one form of fascism and substituting another.

Reason: We are talking just a few days after the 10th anniversary of the Tiananmen Square massacre. Was the democracy movement in Beijing a historical blip?

Cox: No. The desire for freedom in China is as strong as ever before. The 1989 effort almost succeeded. The fact that it failed in 1989, the fact that the leaders–over 1,000 of them–were executed does not mean that one-fifth of the world's population wishes to be held under the thumb of communism forever.

Reason: What do you think relations between the United States and China will look like in 2009?

Cox: I hope that we have a completely free exchange of people, ideas, and commerce between the United States of America and the Republic of China, no longer the People's Republic of China.

Reason: Some commentators think the early years of the next century will be marked by confrontation, perhaps even outright conflict among Asian powers, India, China, Pakistan. What is the U.S. strategic interest in the region?

Cox: I went to New Delhi and met with the president and prime minister of India two years ago, and Prime Minister Gujral told me that the PRC was exercising a pincer movement on India. He pointed specifically to the deployment of nuclear missiles in Tibet, to the submarines in the Indian Ocean–which we now know will soon have U.S.-designed nuclear warheads–and to the fact that Burma had been turned into a PLA armed camp and Pakistan was being armed by the PRC as an irritant to India.

We have a history of cordial relations with Pakistan. These days we have no reason to prefer India or Pakistan, and a lot of good reasons to help them resolve their dispute in Kashmir. If we devoted one ounce of the tons of energy that is being applied to our policy of engagement with the PRC to the largest democracy on Earth, I think the early gains would be impressive. Beating up on the PRC has not and probably will not work as a trade policy. But there's no reason in the world that we cannot be equally nice to India, China's rival.

That negotiating leverage will more than anything improve our relations with the PRC. At the same time, it offers us the prospect of opening up new markets in the most populous country on the earth. The most populous country on earth in 2020 is India, not the PRC. As justification for his China policy, Richard Nixon said it is difficult to ignore a billion people. We are doing a fine job of ignoring a billion people in India today.

Reason: One of the great transmitters of American ideals and principles is America's open media. Might it be a good idea to include in any trade deal we cut with China a provision that it allows in American media?

Cox: Rupert Murdoch won a concession from the PRC just a few years ago for Star TV to have satellite rights. But in turn, he had to agree that the PRC's propaganda ministry could exclude anything they found objectionable. It is not required by nature that all trade is liberating. It is possible that Star TV, even though it is only broadcasting approved information, is nonetheless a better foot in the door than nothing at all. But we should not think in some sort of politically Calvinistic way that positive results are foreordained just because somebody is making money.

Reason: Environmental and labor provisions are often included in trade negotiations. Is it legitimate for open access to media to be a part of them as well?

Cox: Of course. Right now, the PRC is building an intranet, so all of the Chinese citizens who think they are logging onto the Internet are really logging onto an environment in which all foreign news, and even financial news, will be excluded. It requires a great deal of advanced technology to pull off something so audacious. Undoubtedly the PRC will be able to buy it.

Reason: That seems to be the backdrop of what we are talking about–the movement of technology and information across borders. Repressive regimes like China's seem to want to cherry-pick technology for the state while keeping information from the public. Is there anything that U.S. policy can do to change that?

Cox: Some of the things are so obvious that they are often overlooked. The president of the United States made a 10-day trip to the PRC. He refused to meet with the founders of the Chinese Democratic Party while he was there. At the same time, he pointedly called Jiang Zemin "the right leader at the right time." The message was not lost on the Communist Party. They rounded up the leaders of the Democratic Party, who attempted to register within the rules, and put them in jail, where they still remain.

Reason: In an op-ed, you write, "The exercise of joining the democracies together behind an international export-control regime, like the annual human rights resolution in the U.N. Commission on Human Rights, is important." Could you expand on that?

Cox: We have the worst of all possible worlds when it comes to U.S. export control. There is paperwork. There are denials of licenses. As a result, there are administrative overhead expenses and lost market opportunities. Competitors in allied countries eat our lunch. When the U.S. government denies a sale, U.S. citizens have a right to expect that it will be for some overriding national security benefit.

If the United States government doesn't lift a finger to win the cooperation of our allies in such an effort, then it is twice shame on us. Until 1994, there was such a regime [the Coordinating Committee for Multinational Export Controls (COCOM), which restricted exports to communist countries]. The Clinton administration led the way in dissolving it. Undoubtedly, COCOM should have been updated after the collapse of the Soviet Empire. But COCOM covered not only the Soviet Union and the Warsaw Pact but also the PRC.

Reason: Sort of like Humpty Dumpty–it's broken and you want to put it back together again.

Cox: My view is that it wouldn't be hard to put it back together. It would require only that the president desired it. We could begin by talking to our closest allies–England, Canada, Mexico–and asking whether they would commit to a multilateral regime, provided the United States was successful in winning two or three dozen commitments first. Pending approval by such a large number of countries, I believe many of our allies would say yes.

Reason: Let's go to domestic issues. It's budget time again, and it looks like there will be another omnibus bill. I was recently talking with someone who works domestic policy at the White House who says they are putting together a wish list of all the items they expect to get in last-minute negotiations. He said, "I don't know why [Republicans] do this to themselves every year." Why do you?

Cox: Actually we are going to pass all the appropriations bills before we recess this summer.

Reason: You say that with a straight face.

Cox: We have had two conferences two days in a row devoted to this very topic, and we are committed to doing it before we leave in August.

Reason: You have been working on budget process reform for years. Briefly, what would your budget process reform bill do?

Cox: The law on the books since 1974 requires that we finish by June 30. Congress, Republican or Democrat, has never done that. If we were to enact my legislation, the failure to obey that law would have serious consequences. First and foremost, the Congress would lose the capacity to do what they call "improvement" on last year. Everything would be frozen at last year's levels. Second, it would take two-thirds to go outside the budget. Third, the president would be given redundant opportunity to exercise a power called line-item reduction. Not just to line something out, but to pare it back to a level originally set in a budget.

Reason: It seems like a good idea. You have a lot of co-sponsors. Why does it have such a hard time going anywhere?

Cox: Fiscally conservative majorities in the House and the Senate are insufficient. That's the politest way I can put it.

Reason: From the outside looking in, there seem to be few voices for limited government in Congress. Why was the political momentum for limiting government dissipated? How can it be regained?

Cox: It has not dissipated. We have to remember historically where we are coming from. Because of the narrow margins in the House of Representatives–which may have more to do with Monica Lewinsky and impeachment than with a national desire for profligate spending–the realm of the possible is more tightly circumscribed. Being in the majority requires that you spend an awful lot of time in the realm of the possible. The majority is responsible for passing the bills that are necessary to keep the doors open. And if the president sits at the other end of Pennsylvania Avenue and controls two-thirds of the votes with his veto, that is not always a happy chore.

When Republicans were in the minority, we were always operating in the realm of the impossible anyway, so we were free to spend most of our time on bills that described the world as we would like to see it. There is a little less of that intellectual R&D going on, because of the press of business. One hopes that a presidential election provides an opportunity to write on nearly a blank slate and that the vision will be more clear.

Reason: The Republican Congress made big gains in its first years, particularly in its ending of welfare as an entitlement. Since then, there seems to have been a lot of stumbling. What do Republicans do to make themselves attractive to voters when running against Democrats who are for welfare reform, seen as fiscally responsible, and tough on crime?

Cox: We need to expand the circulation of REASON magazine and diminish the circulation of the Los Angeles Times. I better go vote.