16, 2003‹Many observers were surprised last
week when George W. Bush came down in favor
of the People's Republic of China, against a
democratic referendum in Taiwan. His weighing
in on behalf of mainland China becomes more
questionable at a time when well-connected Chinese
companies are funneling large sums of money
to Bush's brothers.
reports reveal that Shanghai-based Grace Semiconductor
Manufacturing, a multi-billion-dollar company
co-founded by a son of China's former president,
has presidential brother Neil Bush under a $2
no background in semiconductors, Neil Mallon
Bush, third brother in the family, got a five-year
contract from Grace, involving an annual retainer
of $400,000 in stock. The arrangement is disclosed
in court papers in Mr. Bush's scandal-ridden
divorce. The business press has conjectured
that Grace hoped to influence US limits on exporting
sensitive technology to China.
even bigger Chinese company recently moved in
ways that benefit youngest Bush brother Marvin
P. Bush. The company is Hong Kong-based Cheung
Kong Holdings, a gargantuan real estate and
investment conglomerate now branching into biotechs.
According to the company, "combined market capitalization
of the Cheung Kong Group amounts to HK$515 billion,"
or "approximately 11.5 percent of the total
market capitalization of the Hong Kong stock
Kong's portfolio now includes Critical Path,
Inc., a California-based software and Internet-messaging
services company that lost money for the first
nine months of this year. The company's SEC
filings list as a significant shareholder Mr.
Purnendu Chatterjee, acting for Winston Partners
LP, a company co-founded by Marvin P. Bush.
Recent filings show that Chatterjee's group
including Winston Partners owns about 5.5 million
shares in Critical Path (6.82 percent). Cheung
Kong already owned substantial shares in Critical
Path in December 2001. Its backing can only
solidify the net worth of Critical Path, which
has faced class action litigation and has changed
top managers a couple of times in the past three
thus cannot but help boost Winston Partners,
a private investment firm in northern Virginia
formed by Bush with longtime business associate
A. Scott Andrews.
is no law forbidding a foreign corporation from
investing in an American company just because
a president's relatives hold financial interest
in the same company. But there are some instances
where taste and judgment, as well as explicit
law, should come into play. It is not appropriate
for a brother of a sitting president to take
money from foreign companies, when we have such
strict laws about disclosure that a president
or First Family member who receives foreign
gifts has to disclose every pair of earrings
or belt buckle. Such gifts usually go to the
American people after a president leaves office,
and the Smithsonian Museum of American History
has a charming exhibition of gifts to previous
presidents and First Ladies.
deals, au contraire, are not being exhibited.
The White House and the Bush brothers have not
responded to questions and requests for information.
(Questions to the companies, to the CIA and
to the FBI have not yet been answered.)
deals are known in the international business
community, where they must make an unfortunate
impression. Marvin Bush is the former head of
the Republican Party in Virginia, worked with
the late GOP operative Lee Atwater, and has
campaigned and networked extensively for his
father and brother, as well as for other GOP
candidates. He was also a Bush "Ranger," one
of a group that raised at least $100,000 in
political contributions to Bush's campaign in
2000. Neil Bush has campaigned for Republican
candidates, have traveled the globe on behalf
of the White House and has also stumped foreign
nations for business deals for his educational
is "restoring honor and dignity to the White
Kong Holdings and Grace Semiconductor are part
of the intensely networked Chinese economy,
with a high degree of public-private partnership.
For Bush to allow his relatives, especially
close relatives, to benefit financially from
deals with well-connected firms in what we used
to call "Red China" is, at best, a sorry reflection
on his taste. For him to follow these deals
with a massive shift of support to China, especially
one that discourages a democratic referendum
in Taiwan, is a worse reflection.
Burns is a freelance writer in Washington, DC,
and can be reached at: email@example.com.
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