The 1995 CIA Report
In 1995, CIA officials dispatched to the White House a secret report based upon the agency's large dossier documenting the corrupt practices of then-Russian Prime Minister Viktor Stepanovich Chernomyrdin, who with Vice President Gore co-chaired the Gore-Chernomyrdin Commission. The private assets that Chernomyrdin had accumulated in his official position, according to Russian security sources, ran into the billions of dollars.1 When the confidential classified report on Chernomyrdin reached Vice President Gore, however, he refused to accept it. Instead, he sent it back to the CIA with the word "BULL****" scrawled across it.2
When the New York Times first reported these grotesque facts, White House and CIA officials denied that the report existed. The National Journal, however, reported approximately six months later that it had independently confirmed the Times account.3 A few months later still, the Washington Post wrote that CIA sources, "had it that the report came back with 'bull----!' scrawled in the vice president's handwriting."4
It is difficult to imagine a more dangerously intemperate reaction by the vice president to official corruption in Russia. Yet this was hardly an isolated incident. The administration had ignored repeated earlier warnings of corruption by Chernomyrdin and other senior Russian officials. Several senior Clinton administration officials have confirmed that they had received a number of reports from the CIA alleging corruption by Chernomyrdin, and that the CIA had submitted many other reports alleging corruption among other senior Russian leaders, including Anatoly B. Chubais.5 "My review of CIA's published material persuades me that it has reported to its readership persuasively and in depth that crime and corruption are pervasive problems in Russia," said a CIA ombudsman tasked with investigating the CIA's work after the first New York Times article about the vice president's "barnyard epithet" appeared.6
It is therefore clear that the vice president rejected not an initial report unsupported by other evidence, but rather a detailed report built on extensive earlier work by the CIA of which Gore must have been aware. Moreover, the allegations against Chernomyrdin were made in the context of numerous charges against other senior Russian leaders--suggesting widespread corruption at the top levels of the Russian government.
Gore's close personal relationship to Viktor Chernomyrdin--and not any superior intelligence that he possessed as Vice President--was therefore obviously decisive in his emotional dismissal of the CIA intelligence report of Chernomyrdin's corruption. At the same time that he was receiving reports of Chernomyrdin's corruption and the growing anger of the Russian people over the power of the oligarchs, the vice president was effusive in his public comments about Chernomyrdin. In June 1995, as they stood together in Moscow, he displayed his lack of objectivity. "Friends have a right to be proud of friends," Gore proclaimed. He added: "The longer one works with [Chernomyrdin], the deeper one's respect grows for his ability to get things done."7
Chernomyrdin Allegations--No Secret
The Clinton-Gore administration's knee-jerk dismissal of top-secret corruption allegations against Viktor Chernomyrdin was all the more remarkable taking into account the extensive information available in open sources, including the Russian and U.S. media.
For example, in the summer of 1995 a respected U.S. analyst of Russian affairs wrote a comprehensive article in the Washington Post detailing wide-ranging charges against the Russian prime minister.8 Peter Reddaway, a political science professor at George Washington University and former director of the Kennan Institute for Advanced Russian Studies, cited accusations by Boris Fyodorov, who had served as Russia's Deputy Prime Minister for Finance, that Chernomyrdin illicitly obtained significant holdings of stock in Gazprom, Russia's gas monopoly, during the firm's privatization--a privatization that Fyodorov characterized as "the biggest robbery of the century, perhaps of human history."9 Chernomyrdin was thus made one of the ten richest men in Russia (Gazprom was worth up to $700 billion). Reddaway also noted similar charges by Vladimir Polevanov, also a former Deputy Prime Minister, in a nationally televised interview in Russia. The New York Times reported in July 1995 that Chernomyrdin's son was building "an enormous country home" in a Gazprom compound, and that he was also thought to be "one of the company's largest shareholders."10
Chernomyrdin's continuing links to Gazprom after his entry into government were also widely reported. In fact, a March 1995, cable from the U.S. Embassy in Moscow signed by then-Ambassador Thomas Pickering directly alluded to Chernomyrdin's continuing involvement with Gazprom after he entered government, and with Gazprom's extraordinary influence over the government:
Numerous public sources noted Chernomyrdin's specific role in ensuring that the gas monopoly paid minimal taxes. One expert estimated that Gazprom's tax breaks cost the Russian budget up to $30 billion12--an immense sum relative to total Russian revenues and expenditures (for example, Russia received less than $15 billion from international financial institutions in the four-year period from 1992 to 1995). This lost revenue had a grave effect on the government's ability to cope with the struggling Russian economy. In this sense, the Clinton administration's uncritical support for Chernomyrdin directly undermined the U.S. policy of encouraging Russia to increase tax collections.
Gazprom in return had provided funds for Chernomyrdin's parliamentary campaign in December 1995.13
In 1998, a book by Russian security officer Valery Streletsky added further public evidence that Chernomyrdin tolerated massive corruption within his government. The author, who headed a unit tasked with investigating government corruption, states that Chernomyrdin's long-time chief of staff, Gennady Petelin, amassed tens of millions of dollars in foreign bank accounts.14 The author further reported that Chernomyrdin's own chief of security personally told him:
Chernomyrdin was recently brought into court to testify about his role in the illegal export of $180 million worth of diamonds and gold during his administration.16 As this report was being prepared, Russian press accounts quoted Swiss police sources as stating that tens of millions of dollars had been transferred into Swiss bank accounts controlled by Chernomyrdin during his tenure as prime minister.17 The transfers were made by Mercata Trading, a firm linked to Mabetex, which is at the center of a major kickback scandal involving $300 million in Russian government contracts, including the scandal-ridden renovation of the Kremlin itself.
Given that Chernomyrdin served as prime minister for five and a half years, his embrace of corruption fundamentally compromised Russia's efforts at economic reform. In this way, the Clinton administration--and Gore personally--contributed not only to Russia's failure to overcome corruption, but to the spread of corruption throughout the Russian political system.
Gore's failure to heed U.S. intelligence by showing discretion about Chernomyrdin and other corrupt officials in his public diplomacy--his willful blindness, and that of other senior administration officials to the overwhelming public and classified evidence of official Russian corruption--sent precisely the wrong signal to U.S. intelligence analysts, who had proven their regional expertise by accurately predicting the collapse of the Soviet Empire.18
The New York Times reported the effect of the vice president's disdain for politically inconvenient intelligence:
One intelligence official has stated publicly: "They never want to hear this stuff." Another commented: "They don't ignore it. But they don't want to have to act on it." Current and former U.S. intelligence officials expressed similar views:
The former Chairman of the National Intelligence Council, Fritz Ermarth, who retired from the CIA in 1998, wrote of senior Clinton administration officials that they had a "disdain for analysis about corruption of Russian politics and their Russian partners ... "22 Ermarth notes that this disdain was particularly strong during the critical 1993-96 period.
They Know That We Know
Russian assessments of what the U.S. knew about Russian corruption also undermine the Clinton administration's claims of ignorance. For example, a report by a think tank associated with the Russian military, the Russian Institute of Defense Studies, states specifically:
The report, issued contemporaneously with the Gore "bull****" incident, further stated:
Yet even as publicly available Russian sources concluded that information about the full extent of Russian official corruption was known to Western intelligence services, the top Clinton administration policy makers chose to ignore it.
A System for Rejecting All 'Inconvenient' Intelligence
Vice President Gore has hedged his denial of the "bull****" incident, saying, "I don't think" that "[I] ever wrote a message of that kind." At the same time, however, he and other senior Clinton-Gore officials have publicly dismissed the CIA reports. Indeed, when asked whether "bull****" had ever been scrawled across a CIA report, Gore plainly referred to a specific CIA report, saying , "whoever sent that over there [could not have] expected the White House to be impressed with it ... it was a very sloppy piece of work."24 Other administration officials dismissed the CIA reports as "rumor," and denied that the CIA had provided "conclusive proof."25
But agency reporting is necessarily based on intelligence sources, often covert. By conveniently demanding a "smoking gun" whenever they sought to suppress uncomfortable facts, Gore and other top Clinton administration officials established standards of proof that were impossible to meet. The result was a rigged system for rejecting all "inconvenient" intelligence whenever it suited the preferences of the White House.
Such misuse of intelligence data deepened the mistrust between the White House and the Intelligence Community. CIA officials have described the resultant "frequent tensions between the agency and policy makers over reporting."26 According to one CIA official:
CIA officials have described the intelligence information concerning Chernomyrdin that was provided to Gore as "more detailed and conclusive than allegations of bribery and insider dealing that have been made in the Russian media and elsewhere."28 Yet when asked--as recently as July 2000--whether Chernomyrdin is corrupt, Gore replied: "I have no idea."29
Recently, Leon Fuerth, the vice president's national security adviser, has tried to play down the widespread intelligence community condemnation of Gore's disdain for official reporting by arguing that the problem of corruption "was on the [Gore-Chernomyrdin] Commission agenda."30 But it is difficult to see how a Gore-Chernomyrdin Commission could meaningfully attack the problem of Chernomyrdin's own corruption, or that of his associates. Indeed, addressing corruption in partnership with Chernomyrdin, whom another former Russian official called "the chief mafioso of the country,"31 was tantamount to endorsing Russia's corrupt status quo.
Gore's lavish praise for Chernomyrdin, and his intentional personalization of their relationship make it equally impossible to accept Fuerth's claim that Gore had no alternative but to deal with the prime minister. (The Clinton administration, Fuerth stated, had either to "boycott the government of Russia" or "deal with [Chernomyrdin]"32--an obviously false choice.) Gore's embrace of Chernomyrdin and the ever-larger role assigned to the Gore-Chernomyrdin Commission went far beyond what was justified by what the U.S. government knew of him, and by the Commission's meager results.33
The pro-forma inclusion of official corruption "on the agenda" of the Gore-Chernomyrdin Commission, along with scores of other topics large and small, is quite different from making its eradication a priority. The content of the Clinton administration's policy on Russian corruption has amounted to general disinterest. It has offered lip service34 while failing to act on specific problems such as money-laundering until forced by events.
The very serious allegations made against the Russian Prime Minister and Vice President Gore's partner in the Gore-Chernomyrdin Commission, amply set forth in official U.S. intelligence reports, were simply rejected by the Clinton administration as the scope of the issues assigned to the Gore-Chernomyrdin Commission was steadily increased. Indeed, to the extent that President Clinton seemed willing to give an ever-increasing role in the U.S.-Russian relationship to the Gore-Chernomyrdin Commission, Gore stood to benefit from maintaining his continued close personal relationship with Chernomyrdin.
In light of Chernomyrdin's notorious corruption, the expansion of the Gore-Chernomyrdin Commission's role and the decision to make it the fulcrum of U.S. policy were a serious error that abetted the growth of official corruption and crime in Russia, to the detriment of the Russian people and the longer-term U.S.-Russian relationship.35 Broader, less centralized cooperation with the Russian government and a less fulsome embrace of Chernomyrdin could have averted these problems, and kept the United States on the side of reform.
The Larger Pattern
Vice President Gore's approach to evidence of Chernomyrdin's corruption is a microcosm of the approach he and the Clinton administration took towards the problem of corruption, which extended far beyond Viktor Chernomyrdin.
As Wayne Merry, a senior official at the Moscow Embassy during the first part of the Clinton administration, testified in September 1999:
The answer to these questions is clear, not only in the case of Chernomyrdin but in many other cases as well. The Clinton administration repeatedly ignored evidence and sought to politicize the analytical process, routinely dismissing or stifling reporting that did not support their policies or fit their political requirements.
Donald Jensen served as a second secretary in the U.S. embassy in Moscow from 1993-1995 and returned to Moscow in 1996. During his 1996 work at the embassy, Jensen wrote a 10-page cable identifying Russian oligarchs who were using their government connections to win control of prized enterprises. According to Jensen, his cable was killed by a Clinton administration Treasury official who worked in the Moscow embassy.
The administration official, Jensen stated, justified suppressing factual reporting about Russian official corruption by arguing that "if the memo were sent to Washington, it could be leaked to the press, and that would undermine U.S. policy."37
Jensen told "Frontline" that the cable was never sent because "it was bad news, and we [the Clinton administration] were intent on making our policies work."38 Moreover, he added:
Thomas Graham, the head of the U.S. Embassy's political section in Moscow from 1994-1997, confirmed Jensen's account in an interview in the Washington Post.40
In the same article, Graham's predecessor in Moscow, Wayne Merry, said the embassy, "was under constant pressure to find evidence that American policy was producing tangible successes, especially after the creation of the 'Gore-Chernomyrdin' working group." Merry also said that the Clinton administration's desire to make the Gore-Chernomyrdin commission a success prevented reporting "about the realities of crime and corruption ... failures in the privatization and general bad news."
Graham argues compellingly that the dismissal of such reporting by senior Clinton administration officials was a direct consequence of their personal relationships with a handful of Russian officials.41 Because senior Clinton administration officials became so close with their counterparts in the Russian government, he suggests, over time they came to trust their Russian interlocutors more than reports from within their own government. Thus, senior Clinton administration officials came to rely upon their Russian partners not only for information, but for analysis and policy recommendations as well; as a result, the CIA, the embassy staff, and other independent sources of information were marginalized.
At times the Clinton administration has positively hindered the uncovering of official corruption: the Swiss government has recently complained of U.S. refusal to cooperate with its criminal investigations into official Russian corruption. Laurent Kasper-Ansermet, a Swiss investigative magistrate, formally requested assistance from the U.S. government in his investigation into the Bank of New York case in September 1999 and began a series of detailed requests for information and assistance in January 2000, but to date has received little cooperation.42
An article in the National Journal suggests that the Clinton administration's policy toward Russia may be a classic case of "groupthink," a psychological process in which "wishful thinking, shaky premises, and a tendency to deny facts at odds with the cognitive underpinnings of a course of action to which a group is committed" can lead to flawed decision-making and policy failures.43 Moreover, because the decision-makers involved in "groupthink" are unable to admit their own errors, they become trapped in a "tangled muddle of self-justification, denial, and distortion." The National Journal analysis attributes much of the problem in Russia policy to Deputy Secretary of State Strobe Talbott and Treasury Secretary Lawrence Summers. They, like Vice President Gore, were unwilling, and eventually unable, to distinguish the imagined world of their own policies from the real world of an increasingly desperate Russia. As a result, the Clinton administration continued, and even intensified, activities that were plainly destructive.
Albert Gore Jr. played the central role in soliciting millions of dollars in campaign money for the Democrat Party during the 1996 election. Gore raised at least $40 million of the $180 million collected by the Democrat National Committee (DNC) for the 1996 campaign. Gore attended eight of Clintons White House coffees and acted as a host himself at 23 coffees with donors. Gores sessions were held in the vice presidents ceremonial office in the Old Executive Office Building next to the White House and at the Naval Observatory. Furthermore, Gore has acknowledged making direct telephone solicitations on government property. At issue is whether Gore illegally solicited funds with a DNC or Clinton/Gore campaign credit card and whether this was a violation of the federal Hatch Act.
They Told Me it was "Community Outreach"
Albert Gore participated in a $140,000 money-laundering, illegal John Huang-organized fund-raiser in April 1996 at a California Buddhist monastery. Gore met the monasterys master in 1989 during a trip to Taiwan. When the press first reported the event in October 1996, Gore claimed that the Democrat event abided by all campaign finance laws. However, as documents implicating Gore came to light, Gore changed his tune from describing the event as "community outreach," to admitting that the event was "finance related." The last Gore confession involves Gore claiming ignorance about the fund-raiser, saying, "I didnt know it was a fund-raiser." Recent revelations from more than 30 documents turned over to Congress by former Deputy Chief of Staff Harold Ickes showed that Gore had been notified more than three months earlier that the event was set to raise $200,000 for the Democrat Party.
However, according to documents examined by the Boston Globe -- three days before the monastery visit, the DNC sent Gores office a confidential memorandum making clear the event was a fund-raiser.
"Minutes before the event, Gore press aide Peggy Wilhide described it as a fund-raiser to a Globe reporter who was traveling with Gore at the time."
(Boston Sunday Globe, 1/12/97)
Four months after the press reported about Gore attending the 1996 illegal John Huang-organized fund-raiser at the Buddhist monastery, the White House released records which showed that Gores office knew it was a fund-raiser and was warned to proceed with "great, great caution."
Security Council [NSC] staff about some contacts the president and vice president had with Asian American fund-raisers now under federal investigation, documents released yesterday show."
"Vice President Gores office was told by an NSC staff official to proceed with great, great caution in deciding whether to attend what Gores office explicitly described as a fund-raising lunch at a Buddhist temple in Los Angeles last year."
"The White House dispatched Vice President Gore to the 1996 event after deciding the concerns were unfounded." (emphasis added)
(The Washington Post, 2/15/97)
Furthermore, the latest revelations, stemming from more than 30 documents turned over to Congress by former Deputy Chief of Staff Harold Ickes, show that Gore had been notified more than three months before that the Buddhist monastery event was set to raise $200,000.
"More than 30 documents dated Jan. 2, 1996 to April 10, 1996, and turned over to Congress by former Deputy Chief of Staff Harold Ickes also show the expected take from the fund-raiser was increased to $350,000 after it was held and $130,000 came pouring into Democratic coffers."
(The Washington Times, 4/11/97)
Harry Truman, who coined the phrase the buck stops here, must be rolling in his grave listening to Al Gore who seems to have cast aside Trumans motto in place of -- pass the buck to the DNC.
Inventors of a new process to convert campaign contributions into government contracts.
The Gore Tax, simply put, is no simple matter. It involves questions of circumventing the Constitution and empowering unelected officials, bad economic policy, inefficient use of technology, and downright dishonest business dealings. At the heart of the matter is this: the Gore Tax is a tax handed to the American people which was not authorized by Congress. Its intended use is the connection of every classroom in America to the Internet, Vice President Al Gore's pet political project, hence his support of the program. Otherwise known as the "e-rate," the Gore Tax is a multi-faceted economic nightmare that raises frightening questions of Executive authority and bureaucratic growth.
The Gore Tax arose out of the Telecommunications Act of 1996, the first rewrite of the Communications Act of 1934, which declared that all Americans should have access to communications services at a reasonable cost. The new act essentially made the same assertion with regard to the Internet. In short, the Act requires the FCC (Federal Communications Commission) to provide unconnected schools, libraries and clinics with Internet access at significantly discounted rates. These rates are determined by the number of students per school who qualify for the federal free lunch program.
The service is funded by a Universal Service Tax on telecommunications providers, who recoup that cost by raising the phone bills of the public. Friction between the bureaucrats who administer the Gore Tax and the telecommunications providers began when the government asked that the tax increase not be itemized, but rather simply hidden in consumers' bills. Telecommunications providers refused to accommodate the government, which tried to camouflage its e-rate scheme. For example, when AT&T began itemizing the new cost on phone bills and a public response ensued, the FCC pressured AT&T to cease this practice.
In this year's budget, $750
million has been allocated to provide Internet access to America's young
people. Further, $2.25 billion per year in discounts has been made available
to schools and libraries. And although Gore does not advertise this fact,
the Universal Service budget is expected to grow to over $10 billion by
2003, the bulk of which will be financed by the discreet tax found in
one's long distance phone bill.
Hammer and Sickle Award