Some scandals find traction in Washington, others fizzle. The Taiwangate affair–which involves a $100 million secret Taiwan government slush fund that financed intelligence, propaganda, and influence activities within the United States and elsewhere–seems to be in the latter category at the moment. The beneficiaries of the lack of attention include three prominent Bush appointees at the State Department who, before joining the Bush administration, received money from this account. And one of these officials, John Bolton, the undersecretary of state for arms control and international security, submitted pro-Taiwan testimony to Congress in the 1990s without revealing he was a paid consultant to Taiwan. His work for Taiwan, it turns out, was financed by this slush fund.
On April 2, The Nation reported that news stories out of Asia, citing leaked classified documents, showed that former Taiwan President Lee Teng-hui had established an illegal covert fund when he was in office and that several million dollars from it apparently were used to pay for a pro-Taiwan lobbying campaign in Washington mounted by Cassidy and Associates, a powerful lobbying firm. The clandestine account, according to the Asian media reports, underwrote the travels of Carl Ford, Jr., a former senior CIA analyst who was a consultant to the Cassidy and Associates effort. The Pacific Forum, the Honolulu-based armed of the Center for Strategic and International Studies, also received money–perhaps $100,000–from the slush fund, when James Kelly, a past National Security Council officer, headed the Forum. Forty-thousand dollars of that money, CSIS confirmed, was sent to Harvard to cover the costs of a fellowship for a former Japanese defense official. In May 2001, Bush appointed Ford to be assistant secretary of state for intelligence and research, and Kelly to be assistant secretary of state for East Asian and Pacific affairs. (For more details, see the “Capital Games” dispatch preceding this one, “Taiwangate?–Bush Appointees Linked to Secret Slush Funds.”)
On April 5, The Washington Post published a similar story, reporting that Taiwanese officials said the fund had paid $30,000 to John Bolton for research papers he wrote in the mid-1990s on how Taiwan could win readmission into the United Nations.
Neither the State Department nor the three State officials who reportedly received money from Lee’s slush fund have felt compelled to make a statement regarding the scandal. None of the officials would answer any questions from The Nation or the Post on the matter.
The day the Post story appeared, a reporter at the daily State Department briefing asked Philip Reeker, the deputy spokesman for the department, to comment on the Post’s article and the involvement of “State Department officials like John Bolton and Jim Kelly” in the slush fund.
“No, I don’t think I read the story,” Reeker said, “and I don’t think we would comment on things that involve people prior to their work at the State Department, their official capacity. So that is just not something we would have anything on.”