U.S.-China Deals Scrutinized

A confidential Senate report critical of the Clinton administration's handling of U.S. missile secrets will be made public, CBS News has learned.

The Senate Intelligence Committee has concluded in a bipartisan report that the Clinton administration was lax in protecting U.S. missile technology from leaking to China through commercial satellite exports.

The committee voted Wednesday to release the report, which deals primarily with the president's election campaign and Loral/Hughes satellite technology transfer to China. It reached the same conclusions as separate reports put together by the Pentagon and a special House committee.

The Senate panel found that the administration largely overlooked the potential security risk in its promotion of satellite exports to China.

"There's an inherent conflict in this policy," Sen. Bob Kerrey, D-Neb., the panel's vice chairman, said Wednesday. "It is in our interest to have China, in their launch capability, to be as ineffective as possible ... because they can transfer it over to the military side."

Kerrey and the panel's chairman, Sen. Richard Shelby, R-Ala., characterized the reports by saying that it focuses on a policy that began during the Reagan and Bush administrations and was enthusiastically embraced by Mr. Clinton to let U.S. companies ship their commercial satellites to China for launch atop Chinese rockets.

Attorney General Janet Reno told reporters Thursday that she would conduct an internal review going back to 1982 to determine exactly what went wrong. "We want to [see] if there is anything we should have done better," Reno said.

U.S. companies needed access to Chinese rockets because of a shortage of rockets for commercial launches in the United States. But after several launch failures, insurance companies underwriting the launches questioned the reliability of Chinese rockets. U.S. satellite makers such as Hughes Electronics and Loral Space & Communications participated in studies and reviews that examined possible causes for the failures.

The American companies denied any wrongdoing, but Pentagon officials and a subsequent House review concluded that China had gained valuable missile-related know-how from these reviews.

The rockets used by China to launch commercial payloads, according to U.S. intelligence, are all but identical to China's ICBMs.

Shelby said the report was adopted in a near-unanimous vote of the intelligence committee members. He did not provide the final tally.

Democrats battled Republican committee members to produce a report that could win bipartisan approval. As a result, some of the tougher language of earlier drafts was scrubbed out, according to Kerrey.

The report also examined allegations that the Chinese government was involved in funneling money illegally into U.S. political campaigns, particularly to the Democratic Party, and that the effort revolved around gaiing influence over key foreign policy and trade matters.

An official familiar with the report said it finds no direct link between China's involvement in contributing to campaigns and the satellite export issue.