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web posted September 6, 1999

Bush reaches $50 million fund-raising mark

Texas Gov. George W. Bush's campaign will report raising more than $50 million by the end of September -- more than any presidential candidate ever has had available to seek the nomination.

With a half-dozen events in September, the campaign expects to add to the total before the Sept. 30 reporting deadline. But the figure is not expected to reach $60 million, one senior Bush aide said.

"I know there are some who are talking about my capacity to raise money, particularly some of my opponents," Bush said while campaigning in Omaha, Neb. "I would suggest that if you ask them, they would like to trade places."

Bush raised a record $37 million through June 30 and has continued to take in money since then, including $250,000 on August 31 at a $1,000-a-plate fund-raiser in Nebraska. The campaign has planned fund-raisers this week in Kansas and Rhode Island.

The week before, the Bush campaign raised about $1 million from events in Georgia, North Carolina and South Carolina.

"The $50 million certainly would indicate that wealthy donors want to ride with a winner," said Kent Cooper of Public Disclosure, an Internet consulting firm. "The aggressive nature of the fund-raisers indicates that he has captured the fund-raising arm of the Republican Party."

By the end of September, Bush will have raised more money than any other presidential candidate ever has, even when federal matching funds are figured in. Including the federal funds, 1996 Republican presidential nominee Bob Dole had $45 million to spend and President Clinton had $43 million.

Bush is not accepting the federal funds, which require candidates to limit their spending in exchange for the money. Neither is publisher Steve Forbes, who is paying for much of his campaign out of his own pocket.

"He's ensuring that he will be able to compete with Steve Forbes, who can spend unlimited money," said Herbert Alexander, professor emeritus of political science at the University of Southern California. "He won't be outspent and he won't rub against the limits. It's perfectly logical for Bush to follow this route."

Bush said that he didn't know how much money he had raised, except to say "it's a lot."

Bush advisers, speaking on condition of anonymity, said the campaign will report more than $50 million in contributions Sept. 30.

Spokeswoman Mindy Tucker refused to comment on Bush's fund-raising totals, saying only that the campaign would release its figures on Sept. 30.

Spokesmen for Bush's opponents said they were long resigned to the Texas governor vacuuming up most of the available cash, and him breaking the $50 million barrier doesn't change anything.

Sen. John McCain, R-Ariz., called it "a sign of his success."

"We don't have to outspend him; we have to out-idea him," Forbes spokeswoman Juleanne Glover Weiss said. "The more this race is pushed into an issues-agenda race, the more Gov. Bush is on Steve Forbes' turf."

"This simply confirms the notion that this is a very tight fund-raising environment," said Jonathan Baron, a spokesman for former Vice President Dan Quayle.

"Our assumption has always been we won't financially be able to catch up to George Bush, but money alone does not win elections, as John Connally, Phil Gramm and Ross Perot can attest," said Ari Fleischer, a spokesman for Elizabeth Dole.

Republicans criticize Clinton decision on Puerto Rican clemency

Two leading House Republicans criticized President Clinton's offer of conditional clemency to 16 members of a Puerto Rican independence group involved in bomb attacks in the 1970s and 1980s.

House Majority Leader Dick Armey accused the president of putting politics before the interests of the country. He said the House might consider a resolution of disapproval.

But Democratic Sen. Charles Schumer of New York, where the clemency offer has been hotly debated, dismissed claims that Clinton was trying to win support among New York's Puerto Rican voters for his wife's probable Senate run.

"I don't think that makes sense," Schumer said, noting that while law enforcement officials say the clemency offer goes too far, Puerto Rican leaders in New York say it doesn't go far enough. "I don't think this was intended to help Hillary Clinton."

The 16 members of FALN, a Spanish acronym for Armed forces of National Liberation, are expected to respond soon to the White House clemency offer. It requires that they offer signed requests for commutation and renounce violence.

The 11 men and five women were not involved in attacks that killed people. FALN carried out 130 bomb attacks on civilian and military targets from 1974 to 1983 that killed six people and wounded dozens.

Human rights groups have argued that the sentences of the 16, ranging from 15 to 90 years, are too harsh.

Rep. Dan Burton, R-Ind., who appeared with Armey and Schumer on NBC's "Meet the Press," said most members of Congress would oppose clemency. "This sends the wrong signal to terrorists around the world," Burton said.

He alleged there are "a lot of people in Washington that are questioning" whether the clemency offer is linked to Mrs. Clinton's run for the New York Senate seat.

"I think New York voters are pretty smart," Schumer said. "They realize that while the first lady is just about to run for the Senate, that she is not responsible for every action taken by the federal government."

The American Conservative Union last week began running ads in New York asking Clinton to advise her husband against pardoning terrorists.

Part of Clintons' vacation paid for by campaign funds

Some of the first family's recent travel and other costs will be charged to Hillary Rodham Clinton's Senate campaign committee because of the political aspects of the family's New York vacation, the White House said August 31.

The expense of the advance team that is arranging the president's public events is being billed to the campaign committee, as was the cost of flying the president and first lady to upstate New York to attend the State Fair and a political luncheon.

White House spokesman Jake Siewert said other costs -- those he associated with the vacation aspects of the trip -- were being paid by taxpayers. He said the White House was closely following the rules for paying for political travel and appearances by the president and first lady.

Siewert said White House lawyers determined some of the first family's activities were political in nature, including a stop August 30 at the New York State Fair. The first lady's committee also has a separate advance team and spokesman working the area. Siewert said the rules Hillary Clinton must follow for her own political endeavors are no different from rules previous first ladies obeyed.

"The exact same rules applied, whether another first lady campaigned for another candidate or the party or her husband," he said.

Clinton has formed an exploratory committee to pay for costs associated with her trips to New York. She has not officially declared she is a candidate but forming an exploratory committee is usually the first step toward an official bid for office.

Clinton, who has never lived or worked in New York, has spent part of her vacation house-hunting in Westchester County north of New York City. She is likely to face New York City Mayor Rudy Giuliani for the seat, which is being vacated by retiring Democratic Sen. Daniel Patrick Moynihan.

Republicans have complained that taxpayers are subsidizing Mrs. Clinton's early campaign-like forays into New York.

Republican National Committee Chairman Jim Nicholson traveled to upstate New York to release a new television advertisement urging the president to sign the GOP tax cut, and he raised the issue during a question and answer session with reporters.

Nicholson said the first lady "has for most of her adult life lived in public housing and is flying around now on United States Air Force airplanes campaigning for the United States Senate."

"Most folks in Skaneateles don't get to stay for free in multimillion-dollar vacation estates; don't get to travel free on planes paid for by the taxpayers," Nicholson said at news conference.

The GOP is paying for the ad to air only on cable television in Skaneateles and it is unlikely to reach many voters. Nicholson said the ad is aimed primarily at the president, but the timing and placement suggested that the GOP also hoped to needle the Clintons during their vacation and poke fun at Mrs. Clinton's prospective Senate campaign.

"Mr. Clinton ... won't you take a moment from your vacation to talk about real tax relief with Hillary and Al (Gore)?" Nicholson said in the ad. "You'll be glad you did when you're living in New York -- or whatever state you decide to call home."

Multimillionaire publisher and GOP presidential candidate Steve Forbes also is running radio commercials in the area that criticize Vice President Al Gore's role in U.S.-Russia relations and urge Clinton to sign the $792 billion package of tax cuts.

Siewert reiterated that the president will veto the tax-cut bill when Congress sends it to him because it wouldn't do enough to shore up Social Security or pay down the national debt. He also alluded to recent public opinion polls, suggesting that Republicans have failed to stir up public support for the plan during the August congressional recess

"We believe that the longer the Republicans talk about their tax cut, the less popular it seems to be," Siewert said.

The president didn't let the political back-and-forth get in the way of golf, hitting the links Democratic fund-raiser Terence McAuliffe, who hales from Syracuse, and a few local political and business leaders.

The first family arrived August 30 in upstate New York ready for rest and relaxation as well as politicking during the last party of their vacation. The Clintons spent five days at an estate borrowed from developer Thomas McDonald in Skaneateles, New York near Syracuse. The location will allow Hillary Clinton to mingle with voters in a predominately Republican area of the Empire State.

Upstate New York may be a key battleground in a possible match up between the first lady and Giuliani. Although Giuliani would seem to have a home field advantage, for upstate voters the mayor of New York City may be as much of an outsider as Mrs. Clinton.

The Clintons spent the first part of their vacation at Martha's Vineyard and in the wealthy Hamptons area of Long Island.

Buchanan to bolt GOP?

Presidential candidate Pat Buchanan "is seriously considering" bolting the Republican Party for the Reform Party, and will likely make a decision in about a month, his top political adviser said today.

"I think it is an incredible opportunity, and there is a big cry across the country for a third party candidate," said Bay Buchanan, his sister who also serves as his chief adviser. "But I won't recommend he do it unless I conclude it would viable and practical.

Bay Buchanan said she plans to make a formal recommendation in about two weeks, based on interviews with a variety of people, including backers and Reform Party members, as well as a review of the election map.

She said her brother, a conservative commentator making his third White House run, will make a decision after he completes an upcoming book tour in late September.

"Pat is seriously considering it," Bay Buchanan said.

If Buchanan does run on the Reform Party ticket, it could draw conservative votes from the party's eventual presidential nominee.

Bay Buchanan said before her brother decides whether to join the Reform Party, he wants to speak with Ross Perot, the Texas billionaire and two-time White House candidate who formed the Reform Party in 1995.

Perot has not ruled out the possibility that he will seek his party's 2000 nomination. Yet he has given no indication he will do so and has made it clear he likes Buchanan.

Perot supporters, including Patrick Choate, who was Perot's 1996 vice presidential running-mate, have been urging Buchanan to seek the party's nomination
"I'm extraordinarily hopeful he [Pat] will do it," Choate said on August 31. "He sounds increasingly interested.

"He [Buchanan] is also getting hundreds of calls from party members" who would like to see him be the Reform Party's 2000 presidential candidate, Choate said.

Buchanan has flirted for months with the possibility of joining the Reform Party. Bay Buchanan initially rejected speculation he might leave the Republican Party, saying, "Pat is a lifelong Republican."

But on Aug. 15, the day of the Iowa Republican straw poll, which saw Buchanan finish a distant fifth, she said a switch to the Reform Party "is an interesting option."

Bay Buchanan said, "This is the first time that Pat has actually put time aside to consider it, and so in that sense it is a giant step forward."

Minnesota Gov. Jesse Ventura, the Reform Party's newest star and highest ranking public official, has been cool to the prospect of Buchanan being the party's 2000 standard bearer.
Ventura has said that Buchanan's social agenda, which includes opposition to abortion, does not fit with the Reform Party's agenda, which is mostly fiscal.

Choate said Buchanan is in tune with the Reform Party on its major issues: a balanced budget, term limits, and trade. "He would be a perfect fit," Choate said.

The Reform Party's presidential candidate will receive $12.5 million in federal matching funds, thanks to Perot getting nearly 9 percent of the vote in the 1996 election.

Does Windows contain spy key?

A Microsoft Windows backdoor is designed to give a US intelligence agency access to personal computers, a leading cryptologist says.

Andrew Fernandes, chief scientist for security software company Cryptonym in North Carolina, claimed on his Web site on September 3 that the National Security Agency may have access to the core security of most major Windows operating systems.

"By adding the NSA's key, they have made it easier -- not easy, but easier -- for the NSA to install security components on your computer without your authorization or approval," Fernandes said.

Fernandes also simultaneously released a program on his site that will disable the key.

The key exists in all recent versions of the Windows operating systems, including Windows 95, 98, 2000, and NT.

The issue centers around two keys that ship with all copies of Windows. The keys grant an outside party the access it needs to install security components without user authorization.

The first key is used by Microsoft to sign its own security service modules. Until late Thursday, the identity and holder of the second key had remained a mystery.

In previous versions of Windows, Microsoft had disguised the holder of the second key by removing identifying symbols. But while reverse-engineering Windows NT Service Pack 5, Fernandes discovered that Microsoft left the identifying information intact.

He discovered that the second secret key is labeled "_NSAKEY."

Fernandes and many other security experts take that to stand for the National Security Agency -- the nation's most powerful intelligence agency.

Through its "signals intelligence" division, the NSA listens in on the communications of other nations.

The NSA did not immediately respond to a request for comment via fax, the only way the agency communicates with inquiries from the media.

The agency also operates Echelon, a global eavesdropping network that is reportedly able to intercept just about any form of electronic communications anywhere in the world.

The agency is forbidden by law from eavesdropping on American citizens.

Marc Briceno, director of the Smartcard Developer Association, said the backdoor represents a serious threat to e-commerce.

"The Windows operating-system-security compromise installed by Microsoft on behalf of the NSA in every copy of Windows 95, 98, and NT represents a serious financial risk to any company using MS Windows in e-commerce applications," Briceno said.

"With the discovery of an NSA backdoor in every copy of the Windows operating systems sold worldwide, both US and especially non-US users of Microsoft Windows must assume that the confidentiality of their business communications has been compromised by the US spy agency," Briceno said.

Briceno coordinated the team that broke the security in GSM cell phones, demonstrating that the phones are subject to cloning -- a feat the cellular industry had thought impossible.

Fernandes said he does not know why the key is there.

"It could be for espionage. It may not be," he said. "It does not totally compromise Windows, it only weakens it.... The only real reason I can see is for them to be able to install their own security providers."

Fernandes made the discovery in early August, he said, but collaborated with the Berlin-based Chaos Computer Club and other experienced hackers worldwide before releasing the information.

"We coordinated this through the worldwide hacker scene," said Andy Muller-Maguhn of the CCC. "It was important to American hackers that it not only be mentioned in America but also in Europe.

"For American citizens it seems to be normal that the NSA is in their software. But for countries outside of the United States, it is not. We don't want to have the NSA in our software."

Coming less than a week after Microsoft was rocked by the embarrassing news that its Hotmail system could be easily penetrated, the latest disclosure could prove damaging to the software giant.

Microsoft officials could not be immediately reached for comment.

"Say I am at a large bank, and I have the entirety of our operation working on Windows," Fernandes said. "That is a little more serious. The only people who could get in there are the NSA, but that might be bad enough.

"They have to first manage to download a file into your machine. There may be backdoors that allow them to do that.... I would be shocked and surprised if the NSA bothered with individuals. What is more of a concern is security systems for a large bank or another data center. Or even a Web server firm.

"The result is that it is tremendously easier for the NSA to load unauthorized security services on all copies of Microsoft Windows, and once these security services are loaded, they can effectively compromise your entire operating system.

"The US government is currently making it as difficult as possible for 'strong' crypto to be used outside of the US; that they have also installed a cryptographic backdoor in the world's most abundant operating system should send a strong message to foreign IT managers," he said.

But Fernandes did not want to set off a panic -- or at least not for everyone.

"I personally don't care if the NSA can get into my machine, because I think they have better ways of spying on me as a person," Fernandes said. "But if I was a CEO of a large bank, that would be a different story."

Without Microsoft confirmation, there is no way to positively establish that the key is controlled by the NSA. However, leading cryptographers say that it cannot reasonably be thought to be anything else.

"I believe it is an NSA key," said Austin Hill, president of anonymous Internet service company Zero-Knowledge Systems.

"We walked though it and talked about all the scenarios why it is there, and this was our conclusion," said Hill. He said that he and Zero Knowledge's chief scientist, Ian Goldberg, did not believe the key's name is a joke placed there by a Microsoft programmer -- one possible explanation.

"Microsoft has not shown incredible competence in the area of security," Hill added. "We call on Microsoft to learn about open security models that provide independent verification of design. No secure system is based on security by obscurity."

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