Behind the Screen: The Clinton/China Connection

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[April 28, 2008] The controversy over the status of Tibet has embroiled nonprofits around the world—and in the U.S., most curiously, one large nonprofit known as the William J. Clinton Foundation.

The Los Angeles Times recently revealed that President Clinton chose to forego his usual six-figure speaking fee for addressing a conference of Internet business people in Hangzhou in September of 2005. Instead, a Chinese firm called Alibaba, Inc. made an “unspecified” but clearly very large contribution to the Clinton Foundation.

Both Clintons—former president and current presidential candidate—have been less than forthcoming about formally revealing the names of donors to their private charities and sizes of the donations. Disclosing a huge donation from Alibaba is not simply a financial matter. It concerns politics.

Alibaba was founded by Chinese Internet mogul Jack Ma. Until the Tibetan crackdown, Alibaba and Ma encountered their sharpest controversy over whether Ma endorsed the sale of shark fin soup. But in 2005, Alibaba and Yahoo negotiated a billion dollar deal giving Yahoo a 40 percent stake in Alibaba and Alibaba operational control over Yahoo! China.

Since the Alibaba connection, Yahoo has found itself mired in serial controversies concerning the Chinese government’s unfriendly policies toward dissenters:

Shortly after the Alibaba deal, the Chinese government arrested and jailed a reporter working for Dangdai Shang Bao (Contemporary Business News) in Hunan province, purportedly for sending the text of a Chinese Communist Party document by email to a foreign website. According to Reporters Without Borders (RWB), Yahoo! China helped Chinese authorities find and identify the reporter’s email account and computer, leading to his 10 year jail sentence. RWB’s conclusion? “We already knew that Yahoo! collaborates enthusiastically with the Chinese regime in questions of censorship, and now we know it is a Chinese police informant as well.” According to Yahoo!, the company was only respecting the laws of its host country. The late Congressman Tom Lantos found Yahoo!’s explanation unconvincing, telling Yahoo! Founder Jerry Yang, “While technologically and financially you are giants, morally you are pygmies.”

More recently, Yahoo! China apparently published “wanted posters” of 24 Tibetan activists sought by the Chinese government for their involvement in protests. Although worldwide protests forced the removal of the pictures of the Tibetan activists, the deed had been done (the fabulous “cache” link on Google and various Internet archive sites keep even momentary postings accessible to cognoscenti).

One doesn’t need to spin conspiracy theories about the Clintons to suggest that they might want to be careful about their financial and philanthropic connections. President Clinton has earned many millions from his association with Ron Burkle’s Yucaipa investment operations. The problem is not the money, but that during Clinton’s tenure at Yucaipa, the firm bought into and consistently increased its ownership of Xinhua Finance Media, an international media and financial services firm. Until this year, apparently, Xinhua Finance had been established by and a subordinate arm of Xinhua News Agency, the Chinese government-run press agency. Chinese government law has codified the Xinhua agency’s role in suppressing dissent, designating another Xinhua affiliate with the responsibility of screening foreign news reports for information that might be deemed “detrimental to ‘China’s national security interests.’” Besides contributing substantially to Clinton’s income for the past few years, Burke and Yucaipa have been associated with Clinton’s philanthropic dealings, notably the Clinton Global Initiative.

This is high stakes politics on an international scale. The dynamic between Tibet and China, which most of the public knows from the public appearances of the Dalai Lama and the protests surrounding the Olympic Torch relay, is being played out over the Internet, with nonprofits in the crossfire. Pro-Tibet nonprofits have been reporting aggressive cyber campaigns of viruses and Trojans, targeting e-mails and stealing encryption keys. These aren’t ordinary, small scale hackers doing the dirty work, but big time campaigns directed against organizations such as the Tibet Support Network, Human Rights in China, and Students for a Free Tibet.

While the Tibetan struggle should not be used to enflame anti-Chinese attitudes, opposition to the Chinese government’s repression of free speech through the Internet and by nonprofits should concern everyone. It should concern Yahoo! and it should concern the business and philanthropic operations of Bill and Hillary Clinton.