February 3, 2008

Duncan Hunter Has Raised the National Security Alarm Over Mitt Romney. So Where Is the Scrutiny?

Filed under: Business Moves,Taxes & Government — Tom @ 9:57 am

Duncan Hunter was little more than a cipher in the 2008 race for the GOP presidential nomination.

That doesn’t change the fact that he he has served his country honorably, both in Vietnam and as a congressman since 1981.

Many observers scratched their heads when Hunter ended his presidential ambitions two weeks ago. Of all the people he might have been expected to endorse, he backed Mike Huckabee.

Why not John McCain? Why not Fred? Why not Objectively Unfit Mitt Romney?

Thompson’s easy: It was clear on January 19 when Hunter withdrew that Fred’s South Carolina showing was the end of the line.

McCain? The differences on immigration were probably too great, and McCain-Feingold didn’t help.

But it’s the reason that Mitt Romney didn’t get Duncan Hunter’s endorsement that deserves greater scrutiny (actually, it would be nice if it got ANY scrutiny).

Late last year, Hunter raised serious alarm over a business deal Mitt Romney’s “former” company, Bain Capital, wants to do that, if approved, has the potential to seriously compromise national security.

“Former” is in quotes in the previous paragraph because, though he likes to feign dissociation, Mitt Romney is still invested in many of Bain’s various entities. The New York Times reported it. When it was on his web site (attempts to locate it today were unsuccessful), the Romney campaign’s extract of the Times’s article conveniently snipped that fact. Though his time at Bain is in Romney’s bio, it doesn’t tell readers that he’s still an investor. Romney’s Personal Financial Disclosure form (PDF is accessible at link), while flawed in several ways, nevertheless confirms that Romney and his family are still heavily invested in Bain, to the tune of many millions of dollars, and perhaps tens of millions.

Here’s what Hunter objected to on November 2 (backup link here for future reference; bolds are mine):

San Diego, CA – - – Presidential candidate and current Ranking Member of the House Armed Services Committee, Congressman Duncan Hunter, today called on former Governor Mitt Romney to send a “clear statement” to the leadership of the company he founded, Bain Capital, to terminate a proposed business deal with a controversial Chinese corporation seeking to acquire U.S. defense contractor 3COM. Bain Capital is attempting to form a business arrangement with Huawei Corporation, a Chinese corporation founded by an officer of the Peoples Liberation Army of Communist China, which faces allegations of assisting Saddam Hussein in the targeting of U.S. aircraft and in helping the Taliban develop surveillance equipment.

“I am extremely concerned that Governor Romney’s company would tout a highly suspect Chinese corporation as a strategic partner,” stated Hunter. “Forming a business partnership with a corporation known to have direct ties with terrorists and dictators while, at the same time, openly seeking to acquire a major U.S. corporation that performs vital cyber security work for the Department of Defense, can only be characterized as irresponsible.”

A resolution has been introduced in Congress, H.Res. 730, which states; “The preponderance of publicly available evidence clearly suggests that as currently structured, the proposed transaction involving Huawei threatens the national security of the United States and should not be approved by the Committee on Foreign Investment in the United States.” A copy of this resolution is provided.

“….. while the Committee on Foreign Investment has yet to rule on the Huawei transaction, this corporation’s connection to Saddam Hussein, the Taliban and the Army of Communist China should clearly disqualify them from becoming, in the words of your former company, “a strategic partner” in acquiring a U.S. firm such as 3COM, which performs vital cyber-security work for the U.S. Department of Defense.

“This letter is a request that you immediately issue a statement of policy that this transaction should be terminated on the grounds of national security. Please let me know what you intend to do.”

Unless I’ve missed it, neither Mitt Romney nor his campaign have responded to Hunter’s concerns. Separate searches on “3com” and “Huawei” at mittromney.com come up empty.

In late September at theWeekly Standard, Irwin Stelzer expressed alarm at the prospect of the deal going through:

True, free trade is great–when dealing with other parties who are in it for the same thing–to make money. But that ain’t the name of the game these days. Now we have a company that must answer to the Chinese government picking up a piece of an American company, 3Com, that–get this–makes “intrusion prevention” technology that helps the Defense Department, among other clients, protect itself from hackers.

True, the Chinese company, Huawei Technologies, will be a minority shareholder. But it–and one must assume any Chinese government official who asks for Huawei’s cooperation–will have access to the books, financial records and any other company documents that they might find useful. Remember: The Pentagon is convinced that the Chinese Peoples’ Liberation Army hackers were the perpetrators of a massive cyber-attack on it just a few weeks ago.

….. One can only hope that Treasury Secretary Hank Paulson reads up on his Adam Smith, no protectionist he. Smith warned that when national security is at stake, free trade takes a distant second place as a national priority. The great Scot is, as usual, as relevant to our day as he was when he wrote The Wealth of Nations 230 years ago.

Stelzer did mention Bain’s involvement, but not Romney’s already-documented, still-existing investments in Bain.

Yes, I know that 3Com and Huawei have been in a joint venture for over four years. But the scope of that arrangement has only involved enterprise networking, and, from all appearances, has had nothing to do with any national security technology 3Com possesses. It may be that Huawei thought it might gain access to national defense secrets in the joint venture setup, and has been frustrated in its attempts to do so — hence the need to buy into 3Com to get around that problem.

Hunter’s press release alluded to the fact that he isn’t the only member of Congress raising national security flags:

Huawei-3Com Deal Threatens US Security: Lawmakers
October 15, 2007

Eight U.S. lawmakers called on the Bush administration on Monday to block a proposed buyout of Massachusetts-based technology group 3Com saying a Chinese company’s role in the $2.2 billion transaction “threatens the national security of the United States.”

Led by Florida Rep. Ileana Ros-Lehtinen, the House of Representatives members are backing a measure that says the 3Com deal should not be approved by the Committee on Foreign Investment in the United States (CFIUS), a federal inter-agency panel that reviews international takeovers.

Coming at a time of growing tension over Chinese imports and corporate expansion, the House measure is a nonbinding resolution that would not have the force of law if passed.

But Ros-Lehtinen, the senior Republican on the House Foreign Affairs Committee, said in a statement: “It would be a grave error for U.S. regulators to approve a deal that permits minority ownership in 3Com by one of the least transparent companies operating in China, a firm with shadowy ties to Chinese army and intelligence services.”

If a deal like this sounds familiar, it should. Go back to the 1990s (Washington Post compilation):

The Clinton administration between 1993 and 1996 allowed numerous exports of potential ballistic-missile technology to the Chinese government despite China’s refusal, in some instances, to allow inspections to assure that the technology was only being used for civilian purposes, according to classified documents and four U.S. government officials.

Ah yes. “The good old days.” The talk-radio airwaves were filled with discussions of and diatribes about Loral, Bernie Schwarz, Hughes Aircraft, Bill Clinton, campaign contributions, and the Cox Report.

I have yet to hear, or hear of, any talk-radio luminaries who couldn’t say enough about the Clinton-China matters in the 1990s uttering one word about Huawei-3Com-Bain-Romney. People connected to Bill Clinton weren’t able to compromise national security until Slick Willie assumed office. People connected with Slick Willard are trying to get in on the game even before their guy is elected.

Imagine how much “fun” they might have if Mitt Romney gets into the Oval Office. Imagine how much less secure we might be.

His investments with Bain, and, in turn, Bain’s investments in the likes of Huawei, and in Russian and Chinese oil companies doing billions of dollars of business with Iran, should cause anyone concerned with our long-term survival to wonder whether Romney’s loyalties are really to the US, first and foremost.

So where are Rush, Laura, Sean, Glenn, Mark Levin, and all the others when we need them?



  1. From BizzyBlog — the Trackback to the following was inadvertently deleted:


    I apologize for that, but the link above is correct.

    Comment by TBlumer — February 3, 2008 @ 11:44 am

  2. >>>So where are Rush, Laura, Sean, Glenn, Mark Levin, and all the others when we need them?<<<

    Some of them are “owned” by Bain Capital.

    Comment by Terri K — February 4, 2008 @ 8:27 pm

  3. #2, they’re a bunch of has-Bains.

    Comment by TBlumer — February 5, 2008 @ 12:29 am

  4. Because I moved out on the high plains this summer, I cannot vote tonight in the caucus out here where I moved, because I did not change my voter registration in time. I could still travel 55 miles one way on snowy roads and vote in my old neighborhood, since I still own a house there. After reading this piece, I think I will not make the drive to vote for Mitt, and I sure am not going to vote for McCain. McCain just gets too much pleasure sticking it to conservatives on practically every issue except the surge.

    Comment by Bob Agard — February 5, 2008 @ 5:08 pm

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