“Here is another example of pay-for-play.…. A Trump administration will end the government corruption.”
—Donald Trump, remarks during a rally in Akron, Ohio, Aug. 22, 2016
As part of what he describes as Hillary Clinton’s corruption, Donald Trump has highlighted incidents involving Swedish telecommunications giant Ericsson, the world’s largest mobile network equipment maker. The lines in this speech are almost directly lifted from the anti-Clinton book “Clinton Cash” by Peter Schweizer.
Here are the points Trump made:
- “In 2009, Ericsson telecommunications came under U.S. pressure for selling telecom equipment to several oppressive governments — including Sudan, Syria and Iran. Some these regimes used those technologies to monitor and control their own people.”
- “In June 2011, Hillary Clinton’s State Department began adding goods and services to a list that might be covered under expanded sanctions on Iran and other state sponsors of terrorism.”
- “During that time, Ericsson sponsored a speech by Bill Clinton, paying him $750,000 — his highest-paying speech.”
- “In April 2012, the Obama administration issued an executive order imposing sanctions on telecom sales to Iran and Syria — but those sanctions did not cover Ericsson’s work in Iran.”
The clear implication of Trump’s remarks is that by giving money to Bill Clinton, Ericsson escaped sanctions for its work in Iran. (In another speech, Trump ad-libbed, “I wonder why,” after he mentioned that the sanctions did not cover Ericsson’s work.)
Does this really add up to “pay-for-play”? We examined the footnotes in Schweizer’s book so you don’t have to. This is a clear example to trying to conjure up smoke when there isn’t even a fire.
In 2009, when Hillary Clinton became secretary of state, she was openly skeptical that the administration’s efforts to engage Iran would be successful and pressed for sanctions that would help bring the Islamic republic to the negotiating table. As part of that effort, the U.S. government pushed allies in Europe to curtail trade with Iran.
Sweden was one country that resisted this push, according to a 2009 State Department cable released by WikiLeaks, which cited “a dynamic (though still fairly small) trade involving some of Sweden’s largest and most politically well-connected companies: Volvo, Ericsson and ABB to name three.” The cable noted that in February 2008, Sweden had signed a bilateral investment treaty with Iran. “The Swedish government is critical of Iran where human rights are concerned, but advocates maintaining a dialogue with Iran and encourages trade with Iran,” the cable said.
In a 2010 letter to the Securities and Exchange Commission, Ericsson said it was aware of the export-control sanctions on Iran and monitored them closely. “In Iran, Ericsson distributes commercial grade systems to public network operators for mobile communications. Ericsson also offers installation and support services for the equipment delivered,” the letter said. “None of the equipment and services provided by Ericsson is intended for military purposes.”
The letter said the company’s main customers in Iran are Telecom Company Iran, Mobile Communication Company of Iran and MTN/Irancell. (Reuters reported that the company was working under contracts signed in 2008 and had no plans to extend them.)
“Ericsson believes that the provision of telecommunications equipment and services facilitates the free flow of information and therefore is in furtherance of the development of welfare, health and democracy in any country,” the letter said.
This is an argument that might have found favor in Clinton’s State Department. Clinton promoted Internet freedom and social media as a way to allow opposition figures to organize against repressive regimes. At a meeting in the Netherlands in late 2011, Clinton criticized companies that sold technology that allowed governments to inhibit the free flow of information. “When ideas are blocked, information deleted, conversations stifled, and people constrained in their choices, the Internet is diminished for all of us,” she said.
Indeed, in April 2012, President Obama issued an executive order that imposed sanctions on people and entities that use technology, such as cellphone tracking and Internet monitoring, to help Iran (and Syria) carry out human rights abuses. In Iran, the executive order targeted the Revolutionary Guard Corps, the Iranian Ministry of Intelligence and Security, the Law Enforcement Forces of the Islamic Republic of Iran, and Datak Telecom, an Internet service provider. Interestingly, the Guardian newspaper reported that “much of the technology used by oppressive regimes was supplied by US firms,” singling out McAfee content-filtering software.
This is the same executive order that Trump referenced in his speech, when he noted “those sanctions did not cover Ericsson’s work in Iran.” But that’s because the executive order was not aimed at cellphone companies. The executive order, targeting entities that thwarted communication, was a logical outgrowth of administration’s policies to encourage the free flow of information across the Internet and social networks.
But Trump made it seem sinister because he inserted this fact in the middle of his timeline: “During that time, Ericsson sponsored a speech by Bill Clinton, paying him $750,000 — his highest-paying speech.” This is in reference to a speech that Bill Clinton gave in Hong Kong in November 2011 at what Ericsson calls a Networked Society Forum (NEST).
“It is designed as a platform for discussion around how a more and more networked world impacts people, business and society,” said Ericsson spokesman Ola Rembe. “NEST in Hong Kong was focused on the role of ICT [information and communications technology] in giving more people access to education.”
Rembe said there was no connection between Clinton’s speech in Hong Kong and the firm’s business in Iran. “The decision to engage President Clinton was taken by the event project team,” Rembe said. “He was chosen for his perceived strong attraction power and selected from a list of many potential speakers with crowd pull.”
How do we know Bill Clinton earned $750,000 for the speech? The fee was listed on Hillary Clinton’s 2011 financial disclosure form.
Separately, we should note (though Trump did not) that the Clinton Foundation has a Swedish branch, Clinton Foundation Insamlingsstiftelse, that has received about $30 million since it was established. Most of this money was given by the Swedish Postcode Lottery and the Dutch Postcode Lottery, Reuters reported. These lotteries, run by the Dutch company Novamedia BV, donate at least 50 percent of their proceeds to charity; the money given to the Clinton Foundation is only a fraction of the $9 billion in charitable donations raised by such lotteries.
The Trump campaign did not respond to a request for additional evidence.
The Pinocchio Test
In all, this is an almost nonexistent case for “pay-for-play.” Obama’s executive order, the result of discussions that included agencies besides the State Department, logically flows from administration policies. There is no evidence that Ericsson’s mobile business in Iran was ever under consideration to be part of the executive order — or that Bill Clinton’s speech five months earlier in Hong Kong played a role in what, ultimately, was an order signed by Obama.
One can certainly question the size of Bill Clinton’s speech fee — and whether it was appropriate, given his wife’s job as secretary of state. But that’s a different matter than suggesting that Ericsson influenced U.S. policy through the Hong Kong speech.
Interestingly, Trump has denied that he engaged in pay-for-play when his charitable foundation made a $25,000 donation to Pam Bondi, Florida’s attorney general, a few days after news reports indicated that Bondi’s office was reviewing complaints of deceptive practices against Trump University. After the donation was received, Bondi dropped the case. The donation was a violation of tax laws, but it was not noticed for several years because the Trump Foundation listed the donation in tax filings as a contribution to an unrelated group with a similar name as the Bondi’s political group. The foundation recently paid a fine for making an improper political contribution.
Perhaps it was all a coincidence, as Trump claims. But if his contribution to Bondi is not pay for play, by his standards, then he has even less evidence in the Ericsson case to level this charge against Clinton.
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