May 13: On This Day In 2018
This one is almost too blatant to believe. Who could imagine anybody could be so shameless?
In short: The U.S. government ordered Chinese telecom corporation ZTE to pay $1.2 billion in criminal fines for undermining U.S. national security. Then Donald Trump personally let ZTE off the hook and instead tried to send customers their way. Why? Because, it seems, China paid him off -- personally.
The backstory: ZTE is 1/3rd-owned by China’s government. From 2010 through 2016, ZTE continuously violated explicit U.S. export control laws. Behind our back, they re-sold hundreds of millions of dollars of American-made technology to two of our most threatening enemies, Iran and North Korea.
ZTE was caught and found guilty of systematically deceiving their U.S. suppliers and lying about it to Commerce Dept. investigators. So they were ordered to pay a record fine for their brazen lawbreaking. And, they were hit with a seven-year ban on purchasing American technology. The case, brought by the Obama Administration, resulted in the hardest-hitting penalties ever assessed for sanctions violations.
But all that changed OTDI 2018, when President Trump announced…he was working with Chinese President Xi to bail out ZTE.
Trump’s turnabout was a shock to the intelligence community. It was also an insult to the millions of Americans who voted for him because they had believed Trump’s tale that he was uniquely able to enforce “law-and-order.”
But there also was a real danger in Trump’s plan to encourage firms to work with ZTE: Chinese firms could encode spyware into their products, weaponizing hardware and software on American citizens, businesses, and government operations. Even Trump loyalist Senator Tom Cotton (R-AR) protested Trump’s plan to coddle China, later co-sponsoring a law that restored the ban on ZTE buying U.S. components. And even years after this incident, ZTE was still being hit with new penalties by other world governments for their subsequent actions.
And as Trump fan Marco Rubio (R-FL) put it: “Problem with ZTE isn’t jobs & trade, it’s national security & espionage. We are crazy to allow them to operate in U.S. without tighter restrictions.”
Now here’s where the story gets really interesting
As HuffPost noted: “A mere 72 hours after the Chinese government agreed to put a half-billion dollars into an Indonesian (resort) project that will personally enrich Donald Trump, the president ordered a bailout for a Chinese-government-owned cellphone maker.” And the project was also given access to a separate half-billion dollar pile of loans.
(Just a side note here: Trump is often accused of “projecting” his own sins onto others. So if you see the Trump Family alleging that Biden’s son received $2MM from China, please keep this billion dollar package in mind. And recall that this is only one of several times the Trump Family’s interests just happened to intersect with $billion payments from foreign governments to Trump-related projects. See the OTDIs of March 18 and Feb 14 for example, plus of course the smaller deals such as March 27’s.)
Dive Deeper
CNN tells the part about Trump’s overturning ZTE’s restrictions
The Huffington Post details the Indonesian / Trump Family tie-in
AP report on Trump’s deal and possible conflict of interest
Trump’s explanations and the considerable political blowback, as reported by Vox
Summary: Apparent link between Trump's decision to lift sanctions on a Chinese firm and a generous Chinese investment in a Trump-related project