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Star Base Closure Economics - Page A1 Star

March 7, 1997

Chinese Got Long Beach Deal!

By Staff Investigative Journalists

LONG BEACH DESK - The Long Beach Naval Station was tentatively placed on the Military Base Closure-List by president George Bush in 1991. President Bill Clinton, closed the naval base last in 1993. That resulted in the loss to Long Beach, California of 17,500 military and civilian jobs. The economic impact of the of loss was $52.5 million and drove the California economy into the tank. It has never recovered.

Between 1995-1996, during the heat of the Clinton-Gore Campaign fund raising activity, the Clinton administration actively intervened to make sure a Communist Chinese cargo container shipping interest got a too-good deal on a Long Beach, California, shipping terminal.

The Secretary of the Navy has formally turned the base over to the City of Long Beach. But, the Port of Long Beach has signed a letter of intent to lease the property to the China Ocean Shipping Co., a steamship line run by the Communist Chinese government.

The Navy base property is about to be leased to a Communist China-owned shipping company under an agreement that was only made possible by the intervention of the White House.

 Forced by a court order, Port of Long Beach officials have now set March 12, 1997 for a new public hearing on plans to bulldoze the Naval Station and lease the property to the Comunist Chinese shipping company.

After a hearing before the court, a judge ruled last week that the deal had been rushed and proper procedures had not been in place.

Clinton was so eager to push the deal through that he met twice with Long Beach officials and once at a White House meeting in 1995 that included his then-chief of staff and the Pentagon's No. 2 official and others.

The deal finally approved by the Secretary of the Navy turns over control of the Long Beach Naval Station, with a value of at least $65 million, free of charge to the City of Long Beach. The city has agreed to lease it to the China Ocean Shipping Co. of the People's Republic of China.

The Chinese deal apparently went forward without a national security review by wither the CIA or National Security Council. The White House apparently avoided normal and routine government channels in pushing the deal through in 1995. '... there seemed to be no reason to check with the National Security Council on the decision ...' White House spokesman Lanny Davis said.

However, the China Ocean Shipping Co. of the People's Republic of China has been actively involved in several recent controversies in addition to a Russian AK-47 gun-smuggling episode on the streets of Oakland, California. In another shocking incident in December, one of the company's ships plowed into a crowded boardwalk in New Orleans, injuring 116 people.

Then, in 1992, the shipping company was fined $400,000 in a violation of U.S. shipping law in connection with is practices involving bribery of government officials in order to avoid paying U.S. tariffs on its imports at United States ports of entry.

There is still more. Six of the company's ships were detained by the Navy and Coast Guard for violating international safety regulations just in the last year. The Coast Guard said, that is has placed the China Ocean Shipping Co. of the People's Republic of China on a target list of shippers to monitor and search.

Last summer China admitted that the China Ocean Shipping Co. was shipping 640 tons of raw waste from the United States to China when it suddenly decided to dump it into the open sea.

In 1993 U.S. Navy shadowed a China Ocean Shipping Co. ship passing in the Persian Gulf after U.S. intelligence warned it was suspected of carrying chemical weapons materials.

CIA director Robert Gates has said ' ... any time you turn over an American port facility to a foreign-owned company, especially one with significant [Communist Chinese] government connection, then at least it ought to be vetted through national security agencies.'

A Navy Department career official said that no intelligence review was sought because the China Ocean Shipping Company's was not considered a security threat, by the Clinton White House.

The Chinese will lease the Long Beach Naval Station base for a 10 year term at a fee of $14.5 million per year. The Chinese will have the option to expand the perimeter of the operation onto another 150 acres of old Navy shipyards that will be developed at the City of Long Beach taxpayer's expense.

Officials at the Chinese shipping interest's headquarters in New Jersey and in Beijing refused to comment or respond to questions about president Clinton's involvement.


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