During the heated months of debate on most-favored-nation trading status for China, many politicians tried to assure the anti-China lobby that while they were against revoking MFN, they really did want to get tough on Chinese misbehavior in other ways. The sincerity of that claim was called into question last week when the Senate defeated an amendment to the defense authorization bill.
The amendment would have required American companies to obtain government approval before exporting a particular class of highperformance supercomputers to countries like China and Russia. Some previously exported supercomputers have been diverted to military use by China and Russia, and the proposed restriction seemed to be a common-sense attempt to staunch the flow of advanced technology to the Chinese and Russian militaries. Indeed, the House of Representatives passed such an amendment overwhelmingly last month.
But when the defense bill came to the Senate floor last week, there was furious lobbying against the measure by business groups like the Chamber of Commerce and computer companies. IBM chairman Lou Gerstner personally called members of the Senate Republican leadership and urged them to vote against the proposed amendment. On July 10, the Senate caved. The amendment was defeated 72-27. A conference committee of the two houses will now have to decide whether to retain the provision.
One other person lobbying the Senate to defeat the amendment was Jack Kemp. He distributed a letter, written on Empower America stationery, strongly criticizing the proposal. This was odd, since Kemp had cosigned an op-ed with his fellow Empower America co-directors on June 23 -- just before the MFN vote -- arguing that "high-tech weapons and technology should not be sold to China."
What would possess Kemp to weigh in, contrary to his previous position, on such an esoteric amendment? Well, it just might have to do with his service on the Oracle Corporation's board of directors. Oracle is a California-based computer company that manufactures software compatible with the supercomputers covered by the amendment. And Kemp's board membership is believed to be highly lucrative.
Oracle refuses to release the terms of Kemp's current membership, but when he temporarily vacated the Oracle board during last year's presidential campaign, he disclosed owning 14,000 Oracle shares, valued at $ 500,000. Needless to say, this was not mentioned in Kemp's Empower America letter.
The MFN debate showed that business interests could trump human-rights concerns. Last week's Senate vote showed that business interests could trump national-security considerations. Is the business of America's politicians really just business?