|Hughes Electronics Corporation
P.O. Box 956
El Segundo, CA 90245-0956
THE FACTS ON THE LONG MARCH LAUNCH FAILURE REVIEW
On April 4, 1998, the New York Times ran a story stating that Loral Corporation and Hughes Electronics were being investigated in connection with their participation in a review of the 1996 failure of the launch of a communications satellite manufactured by Loral on a Chinese Long March 3B launch vehicle. The story referenced allegations that in the course of this review, information relevant to missile technology may have been turned over to the Chinese, and implied that in exchange for political contributions, the Administration gave Hughes special favors allowing continued launches in China. Articles in other publications repeated and, in some cases, embellished this story, perpetuating and exacerbating the factual errors it contained.
Hughes is rightfully proud of its many contributions to national security, and takes seriously its duties to the United States Government and the American people. Allegations of unlawful transfers of technology are very serious and deserve an honest, forthright response. As the facts will demonstrate, none of the allegations and very few of the purported facts contained in any of these stories are true.
CLAIMS THAT HUGHES HAS WON SPECIAL FAVORS
FOR POLITICAL CONTRIBUTIONS ARE FALSE
The New York Times reported that "Loral and Hughes tilted towards the Democratic Party, giving $2.5 million to Democratic candidates and causes, and $1 million to the Republicans." In fact, Hughes is not a "major contributor" to either political party.
- Hughes does not make any federal corporate donations.
- Hughes employees have established a voluntary political action committee (PAC) that
supports various candidates and committees of both parties, although neither the Democratic National Committee nor the Republican National Committee receive any PAC funds.
- Since 1991, total PAC donations are approximately $1 million, with contributions more or less evenly balanced between both parties.
HUGHES HAD ONLY LIMITED PARTICIPATION ON
THE LAUNCH REVIEW TEAM
News reports suggest that a group of American scientists joined together at the request of the Chinese to help them figure out the cause of the 1996 crash of a Long March launch vehicle. In fact, an independent committee was formed at the insistence of a consortium of insurers (including American insurers) to review the explanation offered by the Chinese as to the reasons for the launch failure. Because the next scheduled Chinese launch was of a satellite manufactured by Hughes, two employees of Hughes were asked to participate on that committee, which was headed by Loral.
The facts about the participation of the Hughes employees on the independent review committee are as follows:
- The Hughes employees restricted their activities to reviewing the information and data submitted to the committee by the Chinese.
- The Hughes employees drafted no portion of the report that was prepared by the committee, and provided no copies of the report to the Chinese.
- The Hughes employees played no part in any decision to provide a copy of the committees report to the Chinese.
HUGHES TAKES GREAT CARE TO ABIDE BY
EVERY POSSIBLE SECURITY PRECAUTION
WHEN LAUNCHING SATELLITES IN CHINA
Hughes maintains the strictest possible security for launches in China. Hughes has used the Chinese Long March launch vehicle when requested to do so by the purchaser of the Hughes manufactured communications satellite. In order to export the satellite to China for launch, it is necessary for Hughes to obtain an export license from the United States Government. That license imposes severe and detailed restrictions on the ability of Chinese nationals to access any part of the satellite. All sensitive technology is built into or embedded in the satellite itself. From the time it is shipped from the factory in Southern California until it is launched into space, the satellite is under American control and handled only by American hands, all under the supervision of monitors from the Department of Defense.
- All Hughes employees are regularly trained and re-trained on technology transfer and general security issues.
- All Hughes employees who have access to classified information must have security clearances from the United States Government. Certain clearance processes include a polygraph test to assure loyalty to the United States.
- Hughes employees had very limited participation in the Loral-led review committee, and no control over the preparation or dissemination of its report.
- Hughes employees are trained to exercise caution during all interactions with foreign nationals, and conducted themselves appropriately during the course of their participation on the review committee.
- The Hughes employees did not provide any technological information to the Chinese. (View an example of U.S. regulations governing launches in China.)
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