Clinton Foundation scandal echoes Clinton-China controversy from 1998

Hillary Clinton has been accused of giving donors to her family's foundation special access to the government when she led the State Department — charges that echo a similar scandal from nearly 20 years ago, when President Bill Clinton was accused of ignoring U.S. national security to please a Democratic donor.

In 1996, a U.S. company gave China vital technical information that boosted its missile program, an incident that Clinton's own national security team said was a major mistake.

But instead of punishing that company, Clinton rewarded it by approving the sale of another one of its satellites to China, and dismissed national security concerns as he took that step.

The move was seen as controversial in no small part because the CEO of the company Clinton helped was a major donor to Clinton and other Democrats.

Loral Space and Communications Ltd. was a company that owned a satellite that China attempted to launch into space in 1996. After it crashed, Loral and Hughes Electronics helped China investigate what went wrong.

But the companies advised China without first telling the government, and without permission from the Obama administration. Many in Clinton's own administration believed that their aid violated export control laws, and ended up giving away critical technical know-how that shouldn't have been shared with China.

A congressional report exploring the incident would eventually find that both Loral and Hughes showed China to how to improve the reliability of its long-range rockets as a result of their aid.

But in the face of these charges, Clinton in early 1998 approved the sale of another Loral satellite to China. Connections were quickly made between that decision and the fact that Loral's CEO, Bernard Schwartz, was a heavy Democratic donor.

Schwartz reportedly had to lobby the Clinton administration heavily, and warned that failure to allow the sale would do real harm to his company.

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Additionally, the New York Times reported that this policy was approved even though federal prosecutors said it could "jeopardize their investigation into the satellite maker's earlier, unauthorized help to China's rocket program."

The media was quick to draw the connection between the money and the policy result. CNN reported that Republicans and Democrats were worried that Clinton's move was really an effort to "please a high-dollar Democrattic donor."

The New York Times editorial board said Clinton seemed to bless Loral's questionable move, and reaffirm the idea that Schwartz's donations to the party were enough to keep his company out of trouble.

"Instead of responding firmly, the White House has all but endorsed the possible security breach," the Times wrote. "It is a distressing case, the more so because it coincides with large donations to the Democratic Party from the companies that benefited from the deals with China."

Former GOP presidential candidate Pat Buchanan wrote in 1998 that Schwartz was quickly identified by Democrats as a team player. After joining a Commerce Department-sponsored trip to China, Clinton aide Harold Ickes wrote to the president that Schwartz "is prepared to do anything he can for the administration," Buchanan wrote.

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Clinton defended his decision by saying it didn't lead to any technology transfer to China, and said it was in the U.S. national interest. Years would pass before Loral and Hughes would be fined for the incident. Loral agreed to pay $20 million to settle the investigation in 2002, but didn't have to admit any wrongdoing.

Nearly 20 years later, Hillary Clinton has already faced criticism that while she led the State Department under President Obama, she gave special access to donors to the Clinton Foundation. Clinton has denied these charges, but an analysis by the Associated Press found that most of the non-government officials she met with during her first few years in office were donors to her family's foundation.

Republicans are already warning that Clinton's actions at the State Department could be setting up another incident like the one from 1998, when even the New York Times found that Clinton's actions showed he was too close to Democratic donors.

"Curiously, these decisions follow or are coincidental with large campaign contributions to the Democratic Party by Loral and Hughes in recent years," the Times wrote then. "Loral's chairman and chief executive, Bernard Schwartz, was the top individual contributor to the Democratic National Committee last year."