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2003-05-02

Did Donald Rumsfeld Aid North Korea’s Nuclear Program?: A New Report Reveals Rumsfeld Was On Board of Zurich Firm Abb Which Sold North Korea Two Nuclear Reactors

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A new report reveals Rumsfeld was on the board of Zurich-based firm ABB which sold North Korea two nuclear reactors. [includes rush transcript]

There is one image from the 1980s that might best highlight the ties between the Reagan and Bush White House to Saddam Hussein’s regime in Iraq. It is a grainy video image of a U.S. envoy enthusiastically shaking hands with Hussein himself. The year was 1983 and the envoy was Donald Rumsfeld, the current Secretary of Defense.

Over the past year Rumsfeld’s pair of visits to Baghdad in the early 1980s gained considerable attention but he has generally refused to comment on his trips.

And now it turns out that Rumsfeld is refusing to talk about his possible connections with another of the nations in the so-called Axis of Evil: North Korea.

A new report in Fortune magazine has unveiled that Rumsfeld might have played a direct role in helping North Korea build its potential nuclear capacity.

Three years ago Rumsfeld was sitting on the board of a Zurich-based engineering firm that won a $200 million contract to provide the design and key components for a pair of North Korean nuclear reactors.

The company is ABB. Rumsfeld served on the board from 1990 to 2001. He was the only American serving on the board. And he has never acknowledged ABB’s role building the reactors in North Korea.

But a former ABB director recently told Fortune magazine that Rumsfeld was asked to lobby in Washington on ABB’s behalf.

We are joined by the Fortune magazine writer Richard Behar. The forthcoming issue of the magazine contains his article "Rummy’s North Korea Connection: What Did Donald Rumsfeld Know About ABB’s Deal to Build Nuclear Reactors There? And Why Won’t He Talk About It?"

  • Richard Behar, journalist with Fortune magazine. He wrote the article.
  • Bjoern Edlund, spokesperson for ABB.

Transcript

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: There’s one image from the 1980s that might best highlight the ties between the Reagan and Bush White House to Saddam Hussein’s regime in Iraq. It’s that grainy video image of a U.S. envoy enthusiastically shaking hands with Saddam Hussein, himself. The year was 1983. The envoy was Donald Rumsfeld, the current Secretary of Defense. Over the past year, Rumsfeld’s pair of visits to Baghdad in ’83 and ’84 gained considerable attention, but he has generally refused comment on these trips.

He, it now turns out, refusing to talk about the possible connections with another of the nations in the so-called Axis of Evil: North Korea. A new report in Fortune magazine has unveiled that Rumsfeld might have played a direct role in helping North Korea build its nuclear capacity. Three years ago Rumsfeld was sitting on the board of the Zurich-based engineering firm that won a $200 million contract to provide the design and key components for a pair of nuclear reactors being sold to North Korea. The company is ABB. Rumsfeld served on the board from 1990 to 2001. He was the only American serving on the board, and he has never acknowledged ABB’s role in building these reactors in North Korea. A former ABB director recently told Fortune magazine that Rumsfeld was asked to lobby Washington on ABB’s behalf.

We’re joined now by the writer for Fortune magazine, Richard Behar. The forthcoming issue of the magazine contains his article "Rummy’s North Korea Connection: What Did Donald Rumsfeld Know About ABB’s Deal to Build Nuclear Reactors There? And Why Won’t He Talk About It?" We’re also joined by a spokesperson for ABB, Bjoern Edlund. Let’s begin with Richard Behar. What did you find?

RICHARD BEHAR: Hello.

AMY GOODMAN: It’s good to have you with us.

RICHARD BEHAR: Yes, well, as you mentioned, Rumsfeld was on the board, the only American director, from 1990 until early 2001. Newsweek in February touched on this subject briefly, in which Rumsfeld’s public relations spokesperson said that there was no vote on this and that Rumsfeld does not recall it being brought before the board at any time, but we were able to confirm that the board knew. And what is particularly interesting to us is that if you check the public record going back to 1994, when the agreed framework between North Korea and the United States was done under the Clinton administration, from that point forward, until he became Defense Secretary, you won’t find his view on this light water nuclear reactor deal, and you will find views of just countless numbers of his Republican colleagues, from Paul Wolfowitz on down, Newt Gingrich, Jim Lilley, Larry Eagleburger. There barely was a Republican who didn’t condemn this project, and not a word from Rumsfeld, which we found interesting, and he still doesn’t want to discuss it today.

AMY GOODMAN: Let’s turn to Bjoern Edlund, the ABB spokesperson. What do you know of Donald Rumsfeld’s role in getting the contract to build the nuclear plants in North Korea? Did he have a role as a member of the board?

BJOERN EDLUND: Hi, Amy. I cannot really give you a definitive answer. I know the board was informed, as Richard has written in his article, because the board is always informed about large projects, and obviously this was a large project. Whether the Secretary of Defense now had a role in lobbying, I don’t know, and it wouldn’t have been — it would have been unusual if he had had one.

AMY GOODMAN: It would have been unusual?

BJOERN EDLUND: Yes. You know, first of all, it’s perhaps important to understand the difference between the board structures here and in the U.S. The board of directors is a non-executive body here, and the company is run by the board of management or the executive committee, so, you know, the sort of the insinuation that the board was either asleep at the wheel or whatever are not really very apposite [inaudible]. The real thing here was I think that this seems to me to be a U.S. political dispute more than anything else. I mean, ABB was asked to provide nuclear technology for a U.S. government-led project, which also involved the governments of Japan and South Korea, and later the European Union, and now two dozen other countries. And the whole idea here was to make sure that the North Koreans would dismantle the old nuclear power technology they had and get new nuclear proliferation-resistant technology instead. That was the idea.

AMY GOODMAN: Richard Behar, you talk about ABB’s efforts to keep its involvement in North Korea quiet. Can you comment on that? And then I’ll have Bjoern Edlund respond.

RICHARD BEHAR: What Bjoern said, one ex-director of the board who we spoke with, the only one who would agree to speak on an anonymous basis, recalls being told that Rumsfeld was asked to lobby on ABB’s behalf. We also have Goren Lundberg, who was a top ABB executive in Zurich, who says that he was pretty sure that at some point Rumsfeld was involved, since it was not unusual, he said, to seek help from board members when they needed contacts and help with the U.S. government. This definitely was a U.S.-directed, as Bjoern says, operation, and it was kept pretty hush-hush for a number of reasons, and —

BJOERN EDLUND: Most of the reasons being commercial, because you keep things hush-hush until the contracts are concluded. I mean, we announced the contract in January of 2000, you know, and explained also the international framework behind it, because, you know, we’re not politically naïve. We understand that this was a contentious issue, and it’s important for people to understand when you get involved in projects like this as a company.

RICHARD BEHAR: Right, and some of the top former ABB executives added that a reason to keep it hush-hush was because they just didn’t want other companies, particularly European companies, trying to get involved, which they did anyway, to get a piece of this thing and mess it up. It was a sensitive initiative sponsored, again, by the U.S. government.

Can I add one thing about the light water reactors?

AMY GOODMAN: Richard Behar, yes.

RICHARD BEHAR: There are different arguments as to whether nuclear bomb material can be made from the light waters. It can be made. It’s a more difficult process. It’s more costly. The weapons themselves, as I understand it, are a weaker quality. But the reason the Clinton administration went forward with this was because we were on the brink of war in that peninsula in 1994, and it looks like this deal did restrain the North Koreans, who were notorious cheaters on proliferation agreements, from building a lot of bombs. They had a Russian — which they still have, Bjoern, I think — they have a Russian graphite reactor, in which it’s very easy to get weapons-grade material.

BJOERN EDLUND: Correct.

RICHARD BEHAR: Light waters are certainly better on that, but they’re not perfect. They’re not like coal-fired plants. I mean, you can do it.

AMY GOODMAN: I guess the question is, why doesn’t Donald Rumsfeld say this?

RICHARD BEHAR: Well, to me, that’s the most interesting thing, is that it’s almost — I don’t know. It’s almost as if the other Republicans were carrying a light water forum on this, if I may use a wordplay. You just didn’t hear from him, and he’s not generally someone who keeps his opinions to himself on these issues. And he did touch on these issues without mentioning the light waters or the deal. He did a speech in 1998 to the Heritage Foundation, in which he took a sideswipe, without mentioning the words "agreed framework," he took a sideswipe at it. And he was also appointed by Congress to head a blue ribbon panel in 1998 on ballistic missile capabilities and threats to the U.S., in which he took shots at North Korea. But again, this wasn’t mentioned, and his role on ABB was not mentioned in his resume, which was attached to the Rumsfeld Commission report.

AMY GOODMAN: Can you talk about Westinghouse and what its role is in the building of the nuclear reactors? You mention this, Richard Behar, in your Fortune piece.

RICHARD BEHAR: Yeah. There was a series of corporate transactions that took place, that are a little complex. I’ll try to simplify it, but, you know, if I haven’t done it right, please jump in. But ABB’s nuclear division was sold right before — the negotiations to sell it took place just shortly before this actual contract was signed by ABB. There were five years of negotiations going on since around 1995. Then in 1999, Westinghouse was bought by a British government firm, BNFL, British government-owned, and that was about a year before it also bought ABB’s nuclear power business. So the project is now in Westinghouse’s hands, and these key components for the nuclear reactors are being — and many of them are manufactured already — sitting there waiting in factories in New Hampshire for shipping, if and when the U.S. government says to go ahead and do it. But about 300 documents, technology, was transferred, ultimately, already to the North Koreans, and there’s been a suspension on that.

BJOERN EDLUND: No, no. To the South Koreans. To the South Koreans.

RICHARD BEHAR: Sorry?

BJOERN EDLUND: Richard, to the South Koreans, who are building —

RICHARD BEHAR: Well, to the South Koreans to provide to the North Koreans

BJOERN EDLUND: South Korean companies are building this.

RICHARD BEHAR: I’m sorry? Say?

BJOERN EDLUND: They’re South Korean companies are building the nuclear power plants.

RICHARD BEHAR: Yeah, well, that’s the way it was set up, and there were training courses done, and the South Korean engineers are taking Westinghouse’s technology and training and providing it to the North Koreans.

BJOERN EDLUND: Yes.

RICHARD BEHAR: So it’s an indirect route there.

BJOERN EDLUND: Mm-hmm.

AMY GOODMAN: Well, I want to thank you both very much for being with us. Richard Behar writes for Fortune magazine. His piece is "Rummy’s North Korea Connection: What Did Donald Rumsfeld Know About ABB’s Deal to Build Nuclear Reactors There? And Why Won’t He Talk About It?"

RICHARD BEHAR: May I add just one thing?

AMY GOODMAN: Yes.

RICHARD BEHAR: I appreciate your interest in this. It is interesting, since the story came out on Monday, there’s been no interest in newspapers, magazines or TV on this subject, and the press corps is following Rumsfeld around the world, but they seem to be asleep at the switch on this subject, which is unfortunate. It’s an interesting topic that people should be talking about, I think.

AMY GOODMAN: Well, thanks for being with us and going on the air. Also, Bjoern Edlund, spokesperson for the company, ABB.

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