McConnell’s China Connection: Elaine Chao

1069
The Young Turks / YouTube Mitch McConnell Finally Cares About 39 1547648761.jpg...
The Young Turks / YouTube

While researching McConnell’s background, I came across information about his wife Elaine Chao that I put aside because it didn’t fit into the jigsaw puzzle of a story I was then assembling around the senate majority leader tyrant.

I cut one piece of information — the oddness of Chao’s connection with a Californian internet startup called Multacom — specifically because of the speculative nature of the links. But that omission niggled at me; there were facts here that I felt were germane to the big picture even though I couldn’t pin them down with definite conclusions.  Instead they raised more questions but that in itself can be informative so this strange little snippet from Chao’s past has been reinstated.

Then there were other connections around Elaine Chao that I just didn’t make at the time because I was focusing on McConnell with Chao in his background. Reverse their positions in the picture and the new perspective instantly adds another intriguing layer to the story.

BACKSTORY

Elaine Chao’s father, James Si-Cheng Chao, was born and raised in China. He attended the National Chiao Tung University in Shanghai where he met and befriended Jiang Zemin. That friendship was destined to have a significant effect on American politics. 

After university, their paths diverged. James Chao joined the China Maritime Trust Limited shipping company as a cadet, rose in the ranks to become one of their youngest merchant marine captains, and moved to Taiwan with the company when the communists seized Shanghai in 1949.

Jiang Zemin went to Moscow to take up a traineeship with the Stalin Automobile Works before returning to China where, after a brief stint with the Changchun First Automobile Works, he was transferred to government services.

James Chao moved to New York in 1958 and, immediately after graduating with an MBA in 1964, founded the Foremost Group, a shipping, trading and finance enterprise. Back in China, Jiang Zemin was rising in prominence and rank to become a member of the Central Committee of the Communist Party. 

When the two reconnected isn’t clear. We do know that James Chao placed an order for two ships to be built at the state-owned shipyard in Shanghai during Jiang’s tenure there as mayor.

From the South China Morning Post:

He started meeting Mr Jiang regularly, including three months after the Tiananmen Square crackdown in 1989, when most other American businessmen were avoiding the leadership.

GUANXI (Chinese term for political connections)

Up until this time, Chao’s eldest daughter, Elaine, had been following in her father’s footsteps with a business degree that led to an early career in banking. Her only foray into politics had been a White House Fellowship in 1983.

But soon after her father renewed his friendship with Jiang Zemin, Elaine left the banking industry and began to forge guanxi of her own in America.

Mr Chao’s daughter was rising in prominence in Republican and Asian-American circles, building a reputation as a formidable fund-raiser – a vital skill in the US political money-go-round

In 1986, she joined the Maritime Administration in the Department of Transportation and moved up to Chairwoman of the Federal Maritime Commission in 1988. A year later, the first of the Bush presidents nominated Chao to be Deputy Secretary of Transportation.

In just three years, Elaine had managed to get herself out of banking and into a position in the Executive branch of the US government. It was quite an accomplishment and it demonstrated a single-minded determination.

However it wasn’t a position that afforded her the power she needed to influence American policy on China and it soon became clear that this was part of, if not the whole point of, her political ambitions.

ACQUIRING HER VERY OWN SENATOR

In 1990, Elaine Chao was introduced to Mitch McConnell, senator since 1985, divorced since 1980. Did she consider the usefulness of a congressional connection before this encounter? Or did opportunism arise from the obvious advantages to herself of cultivating the relationship? Her strong-willed character together with vaulting ambition inherited from her father suggests both are possible. 

McConnell was undoubtedly an attractive proposition for her: he had a senate seat but not much money, prestige or leverage. What McConnell lacked, Elaine Chao had in abundance. Moreover, she had the capability to make him into the man he wanted to be and the partner she needed to realise her ambitions. 

She introduced him to a level of society and affluence he’d never known before. She had her father, their friends and business associates throw cash by the bucket-loads into his campaign coffers. She was passionate about politics and he listened to her

The senator had started to shift from a hawkish stance [on China that] aligned with arch-conservative Foreign Relations Committee chairman Jesse Helms to more moderate positions.

That she was the strength in their partnership was never more obvious than when she defended McConnell from a group of protesters while he cowered in the background.

Chao%20defend%20her%20husband..png
“You leave my husband alone!”

They married in 1993 and traveled with James Chao to Beijing to meet up with an old family friend, Jiang Zemin, now President Jiang Zemin of the People’s Republic of China.

WINNING OVER REPUBLICANS AND INFLUENCING POLICY

In 1996, Elaine Chao became a Distinguished Fellow with The Heritage Foundation, the same year they opened an office in Hong Kong. The following year she escorted the foundation’s major donors to a handover ceremony marking the return of Hong Kong from Britain’s 99-year sovereignty to Chinese ownership.

In New Republic, senior editor John Judis credited Chao with persuading The Heritage Foundation and the GOP to change their stance on China.

Ms Chao made clear she was a proponent of ‘Greater China’ and keen to push the pro-engagement line.

Their shift toward accommodation with Beijing has happened quietly, with care to make sure connections between money and ideology are virtually impossible to trace.

MISSTEPS AND SPIES

John Dougherty, writing for WorldNetDaily, noted that Chao’s pro-China stance took on a more strident tone when she

characterized as “racist” the findings of a May 1999 report on Chinese espionage, released by a select committee chaired by Rep. Christopher Cox, R-Calif.

Now that was an interesting reaction. Chao could not possibly be so naïve as to believe the Chinese were not spying on America. Of course they were. And what she also knows is that the charge of racism is a particularly loaded one and a very effective counter-weapon when you have no other argument.

Another brief controversy concerned Chao purportedly serving on the board of Multacom, a California-based company that ran internet links between the US and China in a joint venture with China Unicom. It was a minor role, a mere footnote in Elaine Chao’s bio — until 2001. Sometime in the month following her confirmation as Secretary of Labor, an earnest investigative reporter discovered that Chao had failed to list Multacom in official disclosure documents filed before taking up her role in the Bush-2 cabinet.

The lack of disclosure was described as “an inadvertent omission” but omissions of this kind were taken more seriously in 2001 than they are in the Trump administration and so it lingered for a few days until the media finally lost interest and everyone forgot about it.

That would have been the end of it had it not been for more recent events concerning China Unicom, one half of the joint venture with Multacom. On June 18 last year, China Unicom signed a 5G partnership agreement with the Chinese tech giant Huawei and that was big news. But even bigger news were the hits Huawei’s reputation suffered globally.

On May 2, the Wall Street Journal announced that the Pentagon was moving to ban the sale of Huawei ZTE phones on all U.S. military bases around the world, “citing potential security threats they say the devices could pose.”

Washington officials have said Beijing could order Chinese manufacturers to hack into products they make to spy or disable communications.

[…]

“Huawei and ZTE devices may pose an unacceptable risk to the department’s personnel, information and mission,“ said Army Maj. Dave Eastburn, a Pentagon spokesman, in a statement. “In light of this information, it was not prudent for the department’s exchanges to continue selling them.”

In August, a law went into effect that barred the US government from using Huawei equipment.

On January 11 this year, a Huawei employee was arrested in Poland on espionage charges and in their story, The Guardian reported:

There are concerns about Huawei within Nato as well.

Should there also be concerns about Elaine Chao? There are certainly plenty of questions arising from her connection with Multacom, starting with: what exactly was her role with Multacom? Her Spokesman seemed to agree she’d been on the board but then appeared to contradict this by declaring that her only contact with them had been a brief phone call.

A spokesman for Ms Chao reportedly described the lack of disclosure as an inadvertent omission. He stated Ms Chao was only on the board briefly and ‘never received any money from the company, and her only involvement was one half-hour conference call’.

This raises more questions than it answers.

  • Why did Multacom list her as a board member if, as her spokesman claimed, “her only involvement was one half-hour conference call”?
  • If she only spoke to the company once by phone and wasn’t actually one of their board members, why did the spokesman say she was?

One possible explanation is that Multacom had included China Unicom directors on a joint list of board members posted to its website. Such a list might have had the appearance of being exclusively Multacom’s board members and therefore misled the journalist as to which board Elaine Chao’s name really belonged.

In other words, what if it was China Unicom, not California-based Multicom, that was the real omission? It would explain the spokesman’s bewildering muddle of an explanation. It would also explain a deliberate disclosure omission: Chao might well have felt a strong compunction to hide a connection with China’s state-owned internet service. She’d have an even more compelling reason to hide it after China Unicom hooked up with Huawei last year.

RULES? WHAT RULES?

Such suspicion would not fall on Chao if it wasn’t for other highly questionable behavior. First up, the tale of another incomplete disclosure form. Politico reports:

Elaine Chao’s financial disclosure form makes no mention of any previous employment with or ownership of the Foremost Group.

But in a joint father-daughter interview with the Shanghai Media Group that was recorded between Elaine Chao’s confirmation hearing and the president’s inauguration, James Chao talked about her work to build up the company.

Fortunately for Chao, the Trump administration is cool with disclosure form omissions.

Note this interview was with the Shanghai Media Group. Only once has Chao consented to do an interview with a US TV station. The occasion was her 2017 confirmation; the channel was Fox and the show was Sean Hannity’s. It should’ve been a pleasant few minutes with softball questions and lots of smiling. It’s almost was — except for one gaff, one major gaff, that unintentionally revealed what the new Secretary’s true plans were.

The following quote is taken from a March 2017 Daily Kos story which is well worth reading in full.

After saying how we needed to come up with “new and innovative ways” to revamp our country’s infrastructure, Chao started falling all over herself.

So, basically, we allow foreign inv—uh, we allow different kinds of money, private sector money to come into the United States—I’m not saying foreign—to come and fund, let’s say a bridge or a road or it can be any kind of infrastructure.

Oh but she very definitely is saying foreign and one has to wonder how many Chinese buyers she already has lined up. The Saudis are keen to buy in too.

Since that appearance on Hannity, Chao has refused all other interviews with US media. Not so with Chinese requests, however. There has been more than a dozen of those, all featuring her father.

…media appearances [which] might violate a regulation that prohibits federal employees from using their public office for their “own private gain, for the endorsement of any product, service or enterprise, or for the private gain of friends, relatives, or persons with whom the employee is affiliated in a nongovernmental capacity.”

Government and legal ethics expert, Kathleen Clark, warned Chao to avoid showing any connection with the Department of Transportation on the screen. It was advice Chao totally ignored.

Not only do the DOT flags appear prominently in the New China Press interview and several other interviews, the state flag of Kentucky appears in at least one, which points up her connection to her powerful husband, Senate Majority Leader Mitch McConnell (R-Ky.).

Since Chao became the Secretary of Transportation, the family shipping business has added 10 vessels to its fleet, an increase of 40%. But as the Intelligencer noted:

 …it seems highly unlikely that Trump is going to punish anyone for publicly promoting their wealthy dad’s business.

It seems just as unlikely that he’d punish Chao family members for violating US sanctions on Russian businesses. They’ve been quite clever about it. While they aren’t transacting directly with sanctioned companies they are nevertheless supporting them by doing business with the China banks that entered into joint partnerships with Russian banks sanctioned by the US in 2014.

Doing business with these Chinese abettors may not be illegal but it is dishonorable, more especially because the Russians negotiated the joint partnerships in a desperate attempt to counteract the effect of the US sanctions. Providing them with any kind of relief, however indirectly, is just plain wrong.

IT ALL COMES BACK TO McCONNELL

Other controversies have swirled around Elaine Chao. Some, like her use of government planes, are hyperbolic and don’t survive serious scrutiny. Another story, filed by Politico, tries to make the case that Chao doesn’t work a full week because she often takes time off during normal working hours. But a little digging reveals she more than makes up for it by working “very late into the night, early every morning and each and every weekend“.

The real story that Politico missed is when she takes this ‘private time’:

The vast majority of Chao’s private appointments occurred on Fridays — frequently after lunchtime, and including nine Fridays when she marked at least five hours as private.

When in session, the senate week is… Monday to Thursday. The obvious conclusion: she’s spending most of that time with McConnell. Her spokesperson even said as much, listing her private activities as ranging from:

…doctor’s appointments to meeting with personal friends to tending to personal needs or regularly sharing meals with her husband.

Note: regularly sharing meals with her husband. Not occasionally but regularly.

It would surprise precisely no-one if “tending to personal needs” is also code for spending time with her husband. After all, McConnell is under a lot of stress (of his own making), keeping the government running shut down and preventing 99 senators and 434 House members from having any say whatsoever in the people’s congress.

Elaine Chao didn’t just make McConnell into the man he wanted to be, she’s responsible for the making of the senate tyrant, and for keeping him propped up. The irony though is that she also made him accessible to the GOP’s billionaire donor class (deliberately), the Chinese (also deliberately) and the Russians (shit happens).

Neither of them may believe it yet but if/when McConnell goes down, Elaine Chao will go down with him.

And America will breathe a sigh of relief to be rid of them both.

Thank you to all who already support our work since we could not exist without your generosity. If you have not already, please consider supporting us on Patreon to ensure we can continue bringing you the best of independent journalism.

Leave a Comment

3 Comments on "McConnell’s China Connection: Elaine Chao"

avatar
  Subscribe  
newest oldest most voted
Notify of
George L. Kovacs
Guest
George L. Kovacs

Thieves will always know their own!

Laura
Guest
Laura

This link should be more closely followed….if Elaine and Mitch have connections to China/Russia…it is likely they are also involved in Trump’s Russia “thing”. McConnell has no other reason to hold on so tightly to his support of Trump!

Barbara Kennedy
Guest
Barbara Kennedy

Elaine’s family shipping business has been caught smuggling heroin into this country several times but no charges have been filed against them and their ships were not confiscated as is supposed to happen by law