U.S. to Fund Chinese Nuclear Agency

Human Events, Mar 7, 2005 by Carney, Timothy P

Especially in the light of the left's class-warfare-based attacks against the administration, such as Paul Krugman's recent charge that Bush "takes food from the mouths of babes and gives the proceeds to his millionaire friends," a record corporate-welfare deal could provide additional ammunition to Bush's left-wing opponents.

Bush has also been trying to pressure other nations to do more to stop nuclear proliferation. While visiting Russia, Bush unsuccessfully tried to convince Russian President Vladimir Putin not to help Iran's nuclear power program, arguing that it would aid Iran's efforts to develop nuclear weapons.

Similarly, the administration is scolding North Korea for aiding the nuclear weapons programs of "rogue nations."

Director of Central Intelligence Porter Goss said in mid-February that the U.S. was pressing harder to find details about the proliferation of Pakistani scientist A.Q. Khan. Pakistan arrested Khan in early 2004 for shipping centrifuge materials to Libya. The CNNC sale to Pakistan first reported in 1996 was of centrifuge materials, and the buyer was the A.Q. Khan laboratory.

The U.S. government has been working on aiding Westinghouse's bid for CNNC's contract for months. In a visit to China in October, then-Energy secretary Spencer Abraham lobbied the Chinese to go with Westinghouse for the deal, according to the Pittsburgh Post-Gazette. The Post-Gazette said the $5-billion deal could bring 5,000 jobs to the area, because the reactors would presumably be built in Monroeville.

Ex-Im finances U.S. exports both by loaning money to foreign governments or companies and also by underwriting private loans. For the Westinghouse deal, no specifics have been given as to what portion of the $5 billion would be direct loans, and what portion would be loan guarantees.

In addition to inviting charges of hypocrisy by dealing with known proliferators, the Ex-Im deal could have other negative effects. By engaging in a bidding war, with taxpayer money, against France and Russia, the U.S. government is ensuring a very good deal for CNNC. This enriches CNNC, which is in charge of both nuclear weapons and nuclear power for the communist nation.

Ex-Im is an independent agency, meaning it does not answer to the President. Its board members, while all appointed by Bush, serve fixed terms, unlike Cabinet-agency political appointees, who serve at the pleasure of the President. Still a phone call from the President likely could quash any pending deal.

Mr. Carney is a Phillips Fellow and a journalist in Washington, D.C.