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CBS NEWS — 60 MINUTES

Volume XXIV, Number 28

March 29, 1992

HENRY KISSINGER: [clip from "MacNeil/Lehrer NewsHour"] I think it's outrageous to imply that my views would be influenced by economic considerations, and I want to make—as the man who took the trip to China, I don't need economic motives to have a position on China.

JIM LEHRER: Well, I was going to ask you about that later—

Dr. KISSINGER: It is a disgraceful story.

[Graphic: "Wall Street Journal" headline: "Mr. Kissinger Has Opinions on China — And Business Ties."]

LEHRER: Yeah—

Dr. KISSINGER: It's a shameful story.

LEHRER: Yeah, but—

Dr. KISSINGER: I mean, we ought to be able to have our debates on the merit of the issues, as you pose them, without always attacking the motives of the people who have positions.

ED BRADLEY: [voice-over] You would think that the man who made E.T., the number-one box-office success of all time, wouldn't have any doubts about himself or his movies.

STEPHEN SPIELBERG, Movie Producer/Director: I have doubts about myself in both worlds.

Every movie I make, and every movie I start, I don't think I can pull it off. The same feeling I get going to work every morning is the feeling I got going to school every day, being a bit of an outsider, and not being normal, and not quite getting the grades, and not being able to compete, and I—my tummy is spilkus, my mom would call it.

H. ROSS PEROT, Independent Presidential Candidate: The total national debt was only $1 trillion in 1980, when President Reagan took office. It is now $4 trillion. Maybe it was voodoo economics.

MORLEY SAFER: [voice-over] Who is this lonesome rider? Well, he's a man who says he'll spend $100 million of his own money to make himself president and get us out of—well, let him tell you.

Mr. PEROT: We are now in deep voodoo, I'll tell you that.

MIKE WALLACE: I'm Mike Wallace.

SAFER: I'm Morley Safer.

BRADLEY: I'm Ed Bradley.

STEVE KROFT: I'm Steve Kroft.

LESLEY STAHL: I'm Lesley Stahl. Those stories and Andy Rooney, tonight on 60 Minutes.

[Commercial break]

## Kissinger

WALLACE: Isn't it curious that four living former presidents of the United States together don't appear on television as often as one living former secretary of state? You can't turn on a television set during a foreign policy crisis without finding Henry Kissinger on CBS, PBS, NBC, ABC, CNN or C-SPAN.

But what does he do when he's not on television? Well, through a consulting firm that he calls Kissinger Associates, he sells advice to a gold-plated list of corporate clients, sometimes about how to do business with the very

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same governments, the same leaders, that he talks about on television.

Is there a conflict there? Does Henry Kissinger ever use his fame and connections, his public appearances, to advocate public policies which serve his own financial interests, as well as those of his clients? And is he selling his clients not just advice, but also influence and access?

That's what we wanted to talk to him about, but this time he didn't want to go on television, not unless we played by his ground rules; in effect, he wanted to control the editing. So we decided to go ahead without him.

[voice-over] After many years of public service, Henry Kissinger told me, he was several hundred-thousand dollars in debt. Today, as a public/private figure, he is reportedly worth more than $30 million. How did he do it? Well, for starters, he gives speeches, at up to $40,000 a throw. He nets about a million a year from that. He collects fees for sitting on the boards of some of America's biggest companies, including CBS, American Express, Union Pacific, Revlon, Macy's. That earns him probably another quarter-million a year. He writes 20 columns a year for the *Los Angeles Times* syndicate, like this one shortly after the Tiananmen Square massacre [*The Caricature of Deng as a Tyrant Is Unfair*], for which he collects up to half a million dollars annually.

But the lion's share, between $3 and $5 million a year, comes from Kissinger Associates, a company that he formed in 1982, six years after he left the government. His client list, while a closely guarded secret, is known to include, at any one time, about 30 of the largest companies in the world: American Express, Coca Cola, Anheuser Busch, H.J. Heinz, Volvo, Arco, Hunt Oil, Chase Manhattan, the American International Group (AIG), and Freeport McMoRan, an international mining company. Each pays Kissinger Associates fees between a quarter-million and a half-million dollars a year.

**WALTER ISAACSON, Author of Kissinger Biography:** These are hard-headed people. They're not going to be spending half a million dollars a year if they aren't getting something out of it.

**WALLACE:** [voice-over] *Time* magazine senior editor Walter Isaacson has spent five years researching and writing Henry Kissinger's unauthorized biography. Isaacson had the cooperation of some of Kissinger's clients. He says that what they get is foreign policy advice, strategic insights, and sometimes, extraordinary access.

**Mr. ISAACSON:** There's only one consultant in New York or Washington who can travel with you to China, and you can have lunch in the Great Hall of the People with Deng Xiaoping, and that's Henry Kissinger.

**WALLACE:** [voice-over] That happened with one of his clients in 1989, only five months after the Tiananmen Square massacre. With diplomatic relations badly frayed between China and the U.S., Dr. Kissinger flew to Beijing with his client, Maurice Greenberg, chairman of the American International Group, AIG, and in Beijing they had lunch with China's paramount leader, Deng Xiaoping. By the time Greenberg left China, we've been told, AIG had an agreement to expand its business there, this at a time when the Chinese wouldn't even let the U.S. ambassador, James Lilly, meet with Deng Xiaoping.

**JAMES LILLY, U.S. Ambassador:** I tried to see him, and I was told that he was unavailable, he was retired.

**WALLACE:** And yet Henry Kissinger went—

**Amb. LILLY:** Well, I was— I was—

**WALLACE:** —with Maurice Greenberg—

**Amb. LILLY:** Yes.

**WALLACE:** —and he sat down and had lunch with Deng Xiaoping.

**Amb. LILLY:** Well, you see, I was— I was the heavy. I was the repre-

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sentative of the United States government, which had imposed sanctions on China, and my embassy was surrounded by troops with helmets and guns, and I was not—I was not their favorite boy.

**WALLACE:** [voice-over] The extraordinary access that Kissinger is able to give his clients is based on the contacts and relationships he established while in government as national security adviser and secretary of state under two presidents.

**Mr. ISAACSON:** Kissinger has a nice web of people around the world he has known for years, people who have come to power since he left office, but he's formed connections with. That's how he makes his money. He has a nice seamless web of interests and influence.

**WALLACE:** [voice-over] And Kissinger Associates has been a revolving door for people like Brent Scowcroft and Lawrence Eagleburger, who worked for Kissinger in the Nixon and Ford administrations. Scowcroft and Eagleburger left government to work for Kissinger Associates, and then they left Kissinger Associates to return to government: Scowcroft as national security adviser to George Bush, and Eagleburger as number two man at the State Department. Both men are still close to Henry Kissinger.

For example, just six days after the Tiananmen massacre, Scowcroft flew on a government plane to spend the weekend at Kissinger's Connecticut estate. He listed this trip as official business.

Henry Kissinger's "seamless web" of interests and influence came into play in Kissinger Associates' dealings with Iraq. Ken Timmerman, publisher of *Middle East Defense News*, who wrote the book, *The Death Lobby: How the West Armed Iraq*, says that Iraq's biggest problem in late 1988 was money.

**KEN TIMMERMAN, Middle East Defense Expert:** Iraq was bankrupt at the end of the war with Iran, and was saddled with about $35 billion worth of commercial debt and again as much, another $35 billion, in debts to the Arab world.

**WALLACE:** Seventy billion dollars?

**Mr. TIMMERMAN:** Seventy billion dollars. And Iraq was also spending 50 percent of its GNP on weapons, and weapons manufacturing.

**WALLACE:** Right. So?

**Mr. TIMMERMAN:** So they needed to somehow restructure their debt to regain the confidence of western banks.

**WALLACE:** [voice-over] Iraq needed money badly, and in June of 1989, less than a year after the end of the Iran/Iraq war, a delegation of U.S. business executives from a group called the U.S.-Iraq Business Forum was invited to Baghdad to discuss, among other things, how Saddam could get easier terms on his loans, so he could borrow even more money. This was during the time the U.S. was covertly supporting Iraq as a counterforce to Iran. At least one Kissinger client was in the group, and Kissinger Associates' senior economist, Allen Stoga, was part of the group, too. Marshall Wiley, a former U.S. ambassador to Oman, headed the delegation. We asked him, why Allen Stoga?

**MARSHALL WILEY, Former U.S. Ambassador to Oman:** I'm sure his association with Kissinger had— was probably the primary reason why he was invited to go along.

**WALLACE:** [voice-over] And what did Stoga do in Baghdad?

**Mr. WILEY:** He talked generally about the feasibility of debt restructuring for Iraq and—

**WALLACE:** In other words, he was giving them advice.

**Mr. WILEY:** Yeah. As we all were. That was one of the purposes of our trip.

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**WALLACE:** [voice-over] Joe Conason wrote about Kissinger Associates' involvement in pre-Gulf-war Iraq for the magazine *The New Republic*, and the key element in Conason's story concerned Allen Stoga's trip to Baghdad.

**JOE CONASON, Writer, "The New Republic":** I believe that the U.S.-Iraq Business Forum wanted a representative of Kissinger Associates along because it gives them greater weight. I also believe that they wanted someone who they know has connections to major banking interests.

**WALLACE:** [voice-over] And Kissinger Associates did have a longstanding relationship with a major banking interest: the Banca Nazionale del Lavoro, BNL, a leading Italian bank with branches in the United States, which would prove to be the vehicle through which Iraq would get its major infusion of cash. BNL had been a client of Kissinger Associates from 1986 to '88, and Brent Scowcroft, at that time vice chairman of Kissinger Associates, met three times to give advice, as he put it, to the BNL board of directors. Kissinger himself was a member of BNL's international advisory committee from 1985 to '91.

BNL's branch in Atlanta had been lending Saddam big money, supposedly for agricultural products, because it was against U.S. law to lend Saddam money for military equipment. But the Justice Department discovered that the money was going instead, illegally, for arms, and they seized the bank's records. Nonetheless, Deputy Secretary of State Lawrence Eagleburger, formerly of Kissinger Associates, wrote this 1989 memo proposing even larger "agricultural loans to Saddam." It is unmistakably clear from Eagleburger's memo that he was aware BNL was already under investigation because its previous loans had been used for military supplies.

Well, that investigation continued and in February of 1991, it resulted in a 347-count indictment against a number of former BNL employees. But Kissinger Associates' involvement with BNL and Iraq, and Kissinger's membership on BNL's international advisory committee didn't become public for another four months, until the House Banking Committee investigated BNL and those illegal loans. Representative Henry Gonzalez of Texas is chairman of the House Banking Committee.

**Rep. HENRY GONZALEZ (D-TX), Chairman, House Banking Committee:** Mr. Kissinger held this position during the height of the biggest banking scandal in United States history, $4 billion in unreported loans to Iraq by the Atlanta branch of the Banca Nazionale. Many Kissinger Associates clients were doing business with the Iraqis as a direct result of the unreported $4 billion in BNL loans to Iraq. Volvo, whose chairman serves on the Kissinger Associates board of directors, was doing big business in Iraq, and it was a beneficiary of BNL loans.

**WALLACE:** [voice-over] Henry Kissinger told *The Financial Times* of London that he had resigned from the BNL advisory committee just days before the 347 indictments were handed down because, he said, "I don't want to be connected, I don't want to be asked about this sort of question." But, in fact, Henry Kissinger did not resign from the BNL advisory committee until August of 1991, some six months after those BNL indictments were handed down.

Kissinger also told *The Financial Times*, "I didn't have any idea of what BNL was doing in Iraq," but Ken Timmerman of *Middle East Defense News* thinks that there is no way Kissinger could not have known about what BNL was doing, because some of his clients were involved in the build-up of Iraq's military.

**Mr. TIMMERMAN:** I don't think Kissinger could not have known, with his contacts in the intelligence community and his contacts in the companies that were actually doing the building.

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WALLACE: And the fact is, well, ex-Kissinger Associates people, were now at the top of the Bush administra-
tion.

Mr. TIMMERMAN: Frankly, you couldn't be better plugged-in than that.

Mr. CONASON: The only thing that could happen if you reschedule Saddam Hussein's debt was that he was going to buy more weapons, and that's what he did.

WALLACE: After your piece was published in *The New Republic*, Henry Kissinger wrote *The New Republic* a letter in which he claimed, "I have read with surprise and outrage an article in your edition of October 2. The piece is alive with false allegations about my consulting company's activities in Iraq which, in fact, are non-existent." True?

Mr. TIMMERMAN: Absolutely false. Allen Stoga was in Baghdad; that means he was in Iraq. That means he was engaged in consulting activities in Iraq.

WALLACE: To "listen and learn," says Henry Kissinger.

Mr. TIMMERMAN: No. No. Ask the people who were on the trip and, for that matter, ask Allen Stoga, if he'll come on camera, what he was doing there. Was he just a tourist who got to sit and listen to Saddam Hussein for two hours? Absolutely not, and no one who has ever been in Baghdad, no one who knows anything about Iraq, would believe for a moment that Allen Stoga was there to listen to Saddam Hussein. Saddam Hussein was listening to Allen Stoga.

Mr. WILEY: Kissinger's man Stoga was there at the request of the Iraqis, to go along at this delegation, and I am certain one of their motives was to find out more about what was going on so they could advise their clients. Another motive was to participate in the discussion, along with the rest of us, with the Iraqi government on what the problems were, and I see nothing wrong with this, no.

WALLACE: We were surprised when we got a letter about the Conason article from the publisher of *The New Republic*, Martin Peretz. Peretz is an old and close friend of Henry Kissinger's. Peretz said that he hadn't given Conason's piece "the scrutiny which I should have given it before." He wrote us that the editors of *The New Republic* regretted retailing this story. And then Peretz apparently had second thoughts about his second thoughts, and he had his lawyer call us to ask us not to use the letter in any way.

[voice-over] But *The New Republic* article wasn't the first time Henry Kissinger revealed his sensitivity about criticism of his consulting activities. In 1989 *The Wall Street Journal* had chided him for his dual role as a commentator and businessman dealing with the rulers of the People's Republic of China. Al Hunt is Washington bureau chief of *The Wall Street Journal*.

AL HUNT, Washington Bureau Chief, "The Wall Street Journal":

I have never seen the kind of reaction that I saw with Henry Kissinger. There have been people who have been even madder about pieces, and people who probably had more cause to be angry about pieces, but usually they have quarreled with the facts, they have said it was, you know, it was inaccurate, et cetera. Dr. Kissinger never suggested it was inaccurate. What he basically said was that we didn't have the right to address the issue.

WALLACE: [voice-over] *The Wall Street Journal* story revealed that Henry Kissinger and a number of his clients had set up a $75-million corporation called China Ventures to make investments in China. One of China Ventures' partners was the China International Trust and Investment Corporation, the official investment agency of the Chinese government, widely known to be staffed by various family members of the Chinese ruling elite.

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The Wall Street Journal pointed out that when Kissinger went on television to comment on the Tiananmen massacre, his financial relations with China were never mentioned.

Kissinger didn't like The Wall Street Journal story, and he said so when he appeared on the MacNeil/Lehrer NewsHour.

Dr. KISSINGER: [clip from "MacNeil/Lehrer NewsHour"] I think it's outrageous to imply that my views would be influenced by economic considerations, and I want to make—as the man who took the secret trip to China, I don't need economic motives to have a position on China.

JIM LEHRER: Well, I was going to ask you about that later, but—

Mr. LEHRER: Yeah— and— but it's—

Mr. LEHRER: Yeah, but—

WALLACE: [voice-over] And later, on CNN's *Crossfire*, he told host Michael Kinsley that, after Tiananmen, he had suspended his China Ventures business enterprise.

MICHAEL KINSLEY: [clip from "Crossfire"] But is *The Wall Street Journal* incorrect in saying that you did have business interests that were threatened and, in fact, put on hold by the Tiananmen Square massacre, and that you do have— not that this necessarily interests— that you do have business interests that would profit from a restoring of normal relations with China?

Dr. KISSINGER: Absolutely not.

Mr. KINSLEY: That's completely false?

Dr. KISSINGER: It is substantially false. I suspended these— these— any actions that raise a question of where the Chinese government might benefit; I suspended them, not anybody else, the day after Tiananmen—

Mr. KINSLEY: Well, every business— every business— every American business contact in China was suspended.

Dr. KISSINGER: Absolutely not, almost— most— 95 percent of American businesses continued in China unchanged.

Mr. KINSLEY: So, have you unsuspended—

Dr. KISSINGER: And—

Mr. KINSLEY: Wait, let me ask, have you unsuspended them?

Dr. KISSINGER: They're still suspended.

Mr. KINSLEY: They're still suspended? But why, if you're urging that we renew—

Dr. KISSINGER: Because— precisely to prevent smart-alecks from creating the impression that my opinions are for sale.

Mr. HUNT: He went absolutely ballistic. He called virtually everyone who was quoted in the story, and asked them to recant what they had said afterwards.

WALLACE: [voice-over] One of the people quoted in the story was Peter Jennings, who had used Kissinger as an expert on an ABC News special the day of the Tiananmen massacre.

Dr. KISSINGER: [clip from "ABC News"] I wouldn't do anything, since I think what President Bush did yesterday, the statement he made, seemed to me exactly right. He deplored the action, he called on the government to return to the path of conciliation and dialogue, and

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I believe that this is the wisest course to take.

**Mr. HUNT:** And Peter told us that if he had known that Dr. Kissinger had had the kind of business ties that he had in China, he would not have used him as an analyst on ABC to talk about U.S. policy toward China. And Dr. Kissinger called Peter Jennings and, in essence, talked about the good, long relationship he had had with ABC and suggested that Peter say that he was misquoted or it was taken out of context.

**WALLACE:** And Peter wouldn't?

**Mr. HUNT:** And Peter told him to go fly a kite, or something to that effect.

**WALLACE:** [voice-over] Peter Jennings confirmed the story.

So where do we come down? What's the bottom line on Kissinger Associates? We go back to Walter Isaacson, the man who has spent five years writing a Kissinger biography.

**Mr. ISAACSON:** People aren't just paying for the foreign policy advice, or the strategic insight. They're paying for the name Henry Kissinger. They're paying for the aura that comes around Henry Kissinger. They're paying for the fact that Henry Kissinger can land with them in Malaysia, or in Beijing, and that cabinet ministers will come out and want to see him. So what they get is a whole package, and I don't think we have to characterize it as being excessively sleazy or a paragon of virtue.

**WALLACE:** As we said, Henry Kissinger declined to sit for an interview unless we went along with his ground rules, ground rules about controlling the editing that have been traditionally unacceptable on 60 Minutes.

But during the course of our reporting, we did hear several times from his Washington attorney, Lloyd Cutler who, by the way, was White House counsel under Jimmy Carter. Mr. Cutler wrote us this in respect to Dr. Kissinger's activities with Iraq:

"Dr. Kissinger," he wrote, "was a vigorous public critic of Saddam Hussein's behavior before and after the Gulf war. As for China, you heard Dr. Kissinger himself defend his conduct, both with Jim Lehrer and Michael Kinsley."

Finally, on Dr. Kissinger's behalf, Lloyd Cutler wrote us: "In the light of his well-deserved reputation as a scholar and his considerable accomplishments as a public servant, I would think it outrageous to suggest that his published writings are designed to line his pockets rather than to advocate policies that he believes will best serve the public interest."

[Commercial break]

## Spielberg

**BRADLEY:** If there were an Academy Award category, "best producer and/or director of money-making movies," Stephen Spielberg would win, hands down. Spielberg has either directed and/or produced six of the top moneymakers of all time. If there were a category, "creator of blockbusters who isn't always taken seriously by some in his profession," he'd win that one, too.

No matter. Stephen Spielberg goes on turning out the kinds of films he likes, and if Oscar isn't always impressed, everybody else is.

[voice-over] *Raiders of the Lost Ark* and its two sequels grossed well over $1 billion. *Jaws* made millions as it terrified swimmers all over the world. *Close Encounters, Back to the Future*, all big box-office hits. And, of course, there was *E.T.*, the number-one box-office success of all time. So far, it's taken in $700 million.

So, you would think Stephen Spielberg wouldn't have any doubts about himself or his movies.

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