1/22/2006

Daily Kos: NEW Abramoff News: The Chinese/Sweatshop/GOP Connection.

Long and detailed diary. Bush family's, GOP and Abramoff ties to China's sweatshops and to the destruction of US textile factories -- law

NEW Abramoff News: The Chinese/Sweatshop/GOP Connection.
by dengre
Fri Jan 20, 2006 at 09:18:45 PM PDT

The Abramoff/GOP connection to sweatshops is old news, but worth more investigation. Now new details are emerging.

I've been following Abramoff for a long time and I've posted about the connections between Abramoff, sweatshops, China, DeLay & the GOP a number of times. The link has been the Tan family, the Chinese family behind the sweatshops on Saipan and Millions of dollars sent to the GOP through Jack Abramoff.

The Tan Family and how they connect the GOP to China has been a very underplayed part of this scandal. I've always thought that when this part of the scandal breaks, it will break big.

Well, tonight the story is starting to break.

Over in Hong Kong, Zack Coleman, a reporter for China's Business Newspaper The Weekly Standard has been writing has been writing about the Tan-GOP ties for years.

Today, he broke new details of the Abramoff/China/Sweatshop/GOP connection and how it fits into the growing scandal.

More on the jump...

* dengre's diary :: ::
*

I've written about Coleman's reporting before. It is excellent work. Tonight while touching base with my must read blogs, I came across a notice of a new Zach Coleman article at Talking Points Memo.

Before I begin I want to take a moment to praise the work Josh and his team are doing on the Abramoff Scandal. It is outstanding and often a head of the pack. In fact, Coleman gives them a shout-out in his piece, but we'll get to that in a minute.

An earlier Coleman article, Sweating it out in Saipan presents a good introduction to the Tan Family:

The island of Saipan has been very good to Tan Siu-lin and his children.

In just two decades, this Hong Kong family has built a business empire there encompassing an airline, a sea freight line, a large fishing fleet, a newspaper and ventures in insurance, logistics and many other sectors. It is an empire whose prosperity has been maintained through an intricate web of money-fueled connections to powerful figures in the United States.

Family companies Tan Holdings and Luen Thai Holdings are together the leading players in the island's two main industries, garment production and tourism, as well as Saipan's biggest employer and taxpayer.

The Tans' success in the Pacific, 3,400 kilometers east of Hong Kong, flows from Saipan's status as what amounts to a special economic zone of the United States. [snip] At the same time, the commonwealth has autonomy over its immigration, customs, taxes and minimum wage levels.

The Tans exploit this duality by importing thousands of young women from China and other Asian countries to work in their factories and hotels at starting wages 40 percent below the US federal level. [snip]

Luen Thai turned a profit of US$30.4 million in 2004 as its core operation remained in Saipan sewing clothes for the US market.

Tan Siu-lin, father of Henry, William and four other children, moved the brood from Hong Kong to Guam in 1972 to venture into shipping, real estate and movie distribution. The family business headquarters moved to nearby Saipan in 1983 after the elder Tan opened a sweater factory.

It was the island's first clothing factory and was followed by dozens of others opened by the Tans and companies from South Korea, Taiwan and China. Workers from the Philippines, Bangladesh, Thailand and other Asian nations poured in and quickly outnumbered native residents.

The same article detailed the closeness between the family and the GOP:

Over the last decade, the Tan family and their companies have spent at least US$200,000 (HK$1.6 million) on lobbying and contributions to Washington political campaigns.

More significantly, the commonwealth government and Saipan business associations invested more than US$11.5 million between 1995 and 2002 to lobby in Washington against changes to the islands' status.

This lobbying effort, directed by conservative Republican Jack Abramoff, is now the focus of intense scrutiny in the United States. [snip]

Much of Abramoff's power stemmed from his close ties to Texas Republican Tom DeLay who, as majority leader, is the second most powerful member of the US House of Representatives. Through Abramoff, Willie Tan, who directs the family's ventures in Saipan, also became buddies with DeLay. [snip]

Henry Tan, who as chief executive of Luen Thai and vice-chairman of Tan Holdings heads up the Hong Kong side of the family empire, declined repeated requests for an interview to discuss the Abramoff controversy.

For the Tans, the lobbying and donations were effective. Repeated moves by the Clinton administration and congressmen to change Saipan's status floundered. [snip]

Henry and Josie Tan each donated US$1,000 to George W Bush's 2000 campaign. In October 2002, two family companies on Saipan, the L&T Group and Global Manufacturing, each sent US$25,000 to the National Republican Senatorial Committee. A third, Concorde Garment Manufacturing, sent US$25,000 to the National Republican Congressional Committee.

In the run-up to last year's US federal election, Tan Siu-lin, his five sons and Josie Tan donated a total of US$13,000 to Bush. Son Jerry has also contributed US$4,000 to individual congressional campaigns. Meanwhile, former employee Ben Fitial is gearing up to run for commonwealth governor in the fall with Tan support. [He won and is now the CNMI Governor].

Sometimes Tan family members recorded a Hong Kong address on their donations, sometimes one in Saipan. Federal campaign regulations mandate that only US citizens or permanent residents can legally donate. Luen Thai's IPO prospectus says that Henry and brother Raymond are Chinese nationals living in Hong Kong.

An earlier Coleman article, The Island that lost its shirts, highlights the closeness between Henry Tan and George W. Bush (emphasis added):

The Tan plants were no exception. The US Labour Department sued six Tan companies in 1991 for forcing Chinese labourers to work up to 84 hours a week without overtime (US law requires companies to pay 1.5 times the regular hourly rate for work in excess of 40 hours a week) and paying less than Saipan's minimum wage.

The Tans settled by agreeing to pay the workers US$9 million but negative publicity led clothing giant Levi Strauss & Co to stop buying from the Tans.

Following numerous smaller cases brought by the Labour Department and the Occupational Safety and Health Administration (OSHA) against other plants, officials in president Bill Clinton's administration proposed curtailing Saipan's legal exemptions. The drive foundered on opposition by congressional Republicans, who were extensively wined and dined by the Tans. A picture of family members with President George W Bush hangs above Tan's desk in Hong Kong.

The link between the Tans and the GOP and George W. Bush is Jack Abramoff.

The Tan Family controls our US Territory, the Commonwealth of the Northern Mariana Islands (CNMI). Between 1995 and 2002, Jack Abramoff was paid at least $8 Million dollars to protect the sweatshop interests of the Tan family (and some of their other businesses--more on that later). Often Jack did not have a formal contract and was paid out of a discretionary fund controlled by a corrupt CNMI Governor.

And when there were breaks in the CNMI contract, the Tan family would step in with new clients for Jack. They paid him more than $460,000 through the Saipan Garment Manufactures Association. And they paid Jack more than $120,000 through a front lobbyist as the Tan Holdings Corporations and a whopping $2.3 Million as the Western Pacific Economic Council.

In today's story, Zack Coleman of Honk Kong's Weekly Standard breaks the news about another Abramoff lobbying client, Rose Garden Holdings:



US government investigators probing Washington's explosive Congressional bribery scandal centered on disgraced lobbyist Jack Abramoff recently visited Hong Kong, according to a witness interviewed by the authorities. [snip]

Among the likely subjects of interest here is a previously unknown company called Rose Garden Holdings. In May 2002, Abramoff notified the US Senate that Rose Garden had hired him and Greenberg Traurig, his firm at the time, to represent Rose Garden's "interests before federal agencies and [the] US Congress."

Abramoff recorded Rose Garden's address as a luxury flat in Tai Hang, above Causeway Bay, and its business as international trade. Over the next year and a half, the records show, Rose Garden paid Greenberg Traurig US$1.4 million (HK$10.92 million) for putting its case to the Senate, House of Representatives and US Department of Labor.

Hong Kong's Companies Registry has no record of Rose Garden Holdings; nor does the telephone directory. The apartment listed by Abramoff as Rose Garden's premises has been owned since 1992 by Luen Thai Shipping and Trading, according to the Land Registry. [snip]

Luen Thai Holdings and its controlling shareholders, the Tan family, were leading beneficiaries of Abramoff's Washington lobbying.

Luen Thai officials and spokesmen referred queries about Abramoff and Rose Garden to chief executive Henry Tan, but Tan declined through his secretary to be interviewed, citing his travel schedule.

I'll bet Henry is on the road. Perhaps the Bush donating Chinese National is on his way to a Roy Blunt fundraiser or the RNC winter meeting in DC to hear the latest from Karl Rove, but I digress.

Anyway, back to the Rose Garden. (Say isn't that behind the White House and why are the Chinese holding it anyway?):

Before the Tan family had friends in Washington, they made enemies. In 1991, the US Labor Department sued six Tan companies for paying 1,350 mainly Chinese workers less than Saipan's minimum wage and forcing them to work up to 90 hours a week without required overtime pay. [snip]

After this episode - and ones with other island manufacturers - Saipan's government hired Abramoff to fend off repeated threats to the island's status in Washington.

Abramoff took up the garment makers' cause enthusiastically, taking congressmen and their staff and families to Saipan to enjoy its tropical pleasures and hear the manufacturers' case for protection. Abramoff and his staff trumpeted the clothiers' agenda to administration officials, targeting unsympathetic ones for retribution. [snip]

But the high-priced help became a lightning rod for controversy on the cash-strapped islands. Twice the government dropped Abramoff's services.

Rose Garden's hiring of Abramoff came four months after the government, now under a new governor, ended his contract for the last time. During the previous suspension, four business organizations in Saipan joined to publicly form a new group that paid Abramoff US$2.4 million.

If Abramoff reported "Rose Garden Holdings" as his client, using its name as a front for Luen Thai or other Saipan business interests, he may have violated the US Lobbying Disclosure Act.

Well, of course Jack violated that law. And now he has to tell the Feds why.

Perhaps that's why they are visiting Hong Kong, Guam and CNMI. Some time ago it was reported that CNMI's new Governor, Ben Fitial is cooperating with the DOJ. The visit to Hong Kong is another sign of BIG trouble for the GOP. As they made clear during the Clinton era, money from China is bad. And Bill, unlike George, didn't even take direct donations from Chinese Nationals.

Oh, and then there is that whole How the GOP destroyed US textile jobs and sent all the work to China for off-the-books donations laundered through the Abramoff GOP slush fund thing to worry about if you're a Republican.

Coleman also points out some of the other ways that the Tan Family has been pouring money into the GOP (beyond lobbying and hard/soft donations). And here is where Josh Marshall gets his shout-out..

A LOT more at the source

Daily Kos: NEW Abramoff News: The Chinese/Sweatshop/GOP Connection.

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