A notice filed with the Lobby Disclosure Act Office on Capitol Hill on July 5 disclosed that Taiwan will pay US$2 million to Sandwick International for a one year contract to lobby for the Taiwan Security Enhancement Act (TSEA).
Politicians in Washington are eager to find out the real story behind filing notice.
This is the first time that a US lobbying firm has publicly said that TSEA -- which has been strongly opposed by the Clinton Administration but has already been passed by the House -- would be its specific lobby issue.
The story, first reported by the Washington Post last Thursday, indicated that Cassidy & Associates had ended its lucrative, six-year long contract with the Taiwan Research Institute (TRI) for which it was paid a total sum of about US$10 million.
Cassidy, however, quickly picked up the Taiwan Study Institute (TSI) as another generous Taiwanese client with a contract worth US$2 million, funded by Makoto Bank in Taiwan. The chairman of Makoto Bank, Chen J. Lin (林誠一), said in a press conference that the institute was not interesting in lobbying for TSEA and that "there isn't any political linkage."
However, official documents filed with the US government tell a different story from Lin's version.
All foreign lobbyists are required by law to register either with the US Department of Justice or the Lobby Disclosure Act office on Capitol Hill. Cassidy & Associates merged with Sandwick International last year and the contract between TSI and Sandwick has since been registered under the names of Sandwick Public Affairs, Boland & Madigan Inc and Cassidy & Associates, Inc.
The record has identified about 20 lobbyists, including Carl Ford, a former Defense Department Asia specialist. Lobbyists from the above three firms are supposed to lobby in the areas of defense, foreign relations and trade. TSEA has also been listed as a specific lobby issue.
There is speculation in Washington about the real purpose of the TSI contract. The contract signed between TRI and Cassidy in 1994 for US$1.5 million a year stirred things up in Washington and the Taiwan Strait, following successful lobbying in Congress to force the Clinton Administration to grant a visa to then-President Lee Teng-hui
Based on the file kept by the Department of Justice, the Taiwan Research Institute agreed to pay US$162,500 per month to Cassidy to extend the contract from July 1, 1997 to June 30, 2000. The purpose of this contract was to "assist the TRI in advancing the appreciation of Taiwan's history, cultural uniqueness and democratic development."
Diplomatic sources said that Fredrick Chien
TRI was contacted by Liu Tai-ying
With the new contract with Cassidy being disclosed, the close relationship between Chen J. Lin and President Chen Shui-bian
Even the DPP mission and the Formosan Association for Public Affairs (FAPA), a lobby group close to the DPP, were not aware of the involvement of TSI.
With the new government representative Chen Chien-jen
On the other hand, Cassidy has been working very hard to impress the new ruling party in Taiwan. Last April, DPP Legislator Tsai Trong-rong
"It was a great show that was obviously trying to impress Tsai," said a participant in the briefing, "and they somehow succeeded and put on a great performance."
But some of the delegates were suspicious there may have been a conflict of interest since Sandwick was also lobbying for the Hong Kong Special Administrative Region (SAR) government and for Beijing.
Ford guaranteed that every firm belonging to Sandwick International operated independently and that they knew the rules of the game very well.
The files in the Department of Justice show that Sandwick was lobbying for the SAR government, but there are no records to indicate China was one of their clients.
Hong Kong was returned to the Chinese government by Britain in 1997.
The only two firms officially lobbying for China are Jones, Days, Reavis & Pogue and Powell, Goldstein, Frazer & Murphy LLP Sources said that the DPP mission has been in contact with some lobby firms in Washington since President Chen's inauguration. However, the DPP mission in Washington excluded Sandwick because they believed there to be a conflict of interest.
People familiar with the market said that US$2 million is a lucrative contract, but is not an unreasonable price to pay. But there is no reason to believe that other companies currently lobbying for Taiwan would not feel upset. Records in the Department of Justice show that since 1978, there have been no less than 29 companies lobbying for Taiwan, some of which are no longer active.
The DPP mission in Washington is registered as one of these lobby groups. Last January TECRO signed a new contract with Soloman Group, which is chaired by a strong supporter of Taiwan, former Congressman Gerald Soloman.
An annual report filed last February by Bergner Bockorny Inc revealed that this company received a grand total of US$40,000 in 1999 from TECRO for lobbying foreign assistance authorization legislation, in which an amendment has been passed last year to mandate the Secretary of State to submit a report to Congress regarding Taiwan's participation in the World Health Organization. The company has also lobbied for legislation relating to Taiwan's participation in international organizations and Taiwan's security.
Cassidy is obviously making a lot more profit compared with its competitors dealing with Taiwan. Diplomatic sources said that Liu Tai-ying was very satisfied with Cassidy's performance and even intended to extend the contract after the March presidential election. However, the response from Capitol Hill is not as warm as Liu had hoped for. Jim Doran and Mark Tison, aids of Senator Jesse Helms -- the original sponsor of TSEA in the Senate -- said that the influence of Cassidy has been exaggerated.
An assistant to Representative Ben Gilman, chairman of the International Relations Committee in the House, pointed out that people from Cassidy had no idea about the real situation, when TSEA was voted for in the subcommittee and the full committee. Congressman David Wu's office confirmed they got a phone call from Cassidy on behalf of TSEA, yet they got more from FAPA.
"They just claimed the credit, when the real hard work has been done by other people," criticized a consultant working on behalf of Taiwan.
The publicity surrounding TSEA may have complicated the situation in Congress. FAPA and lawmakers like Tsai have been promoting TSEA, and people who are long time supporters such as the Taiwan Independence Movement have even campaigned in the Washington Post for the passage of TSEA.
However, the extent of involvement by the Taiwan government is so far unknown. Analysts said that it is difficult for President Chen to claim innocence when TSI is lobbying in Washington with such a high profile.
It is an election year in the US and politicians have to behave themselves to avoid getting into trouble with foreign friends. TSEA has not been put on the Senate's agenda yet and it is not helpful for lobbyists to put TSEA under the spot light. Steve Yates, an Asia expert in the Heritage Foundation criticized Cassidy as "disruptive" and urged TSI to drop its contract with them as soon as possible.
Yates said that peaceful transformation and democracy in Taiwan was once the main topic in Washington, and now it changed to Cassidy. He said that "no matter what the intention behind this contract is, one has to wonder what the government in Taipei really wants people to believe."
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