Disclosure of the Chinese exercise comes as officials in the Clinton administration said efforts are under way to soften the conclusions of a congressionally mandated report on missile defenses and missile threats in Asia, including new details on the rapidly growing Chinese missile arsenal.
According to sensitive intelligence gathered by U.S. satellites, aircraft and ships that monitored the Chinese exercise, People's Liberation Army units, including those equipped with intermediate-range CSS-5s and silo-housed CSS-2 missile units practiced firing missiles at Taiwan.
Intelligence information also indicated that the U.S. Army troops based in South Korea, and Marine Corps troops on the Japanese island of Okinawa and mainland Japan were targeted with strikes. "They were doing mock missile attacks on our troops," said one official.
White House spokesman David Leavy said he could not comment on intelligence matters.
A senior administration official confirmed that the missiles were CSS-2s, first deployed in 1971, and CSS-5s, first fielded in the 1980s.
Both weapons had "never been pointed our way before," the senior official said. "The important point is these are not new missiles."
The official did not address the threat the Chinese missiles posed to the 37,000 troops based in South Korea, and 47,000 troops in Japan, including about 25,000 Marines on Okinawa.
The intelligence report also raises questions about the recent statement of Chinese President Jiang Zemin, who announced during the June summit in Beijing that he and President Clinton agreed "we will not target each other with the strategic nuclear arms under our control."
The Chinese leader told reporters June 27 that the detargeting "shows the whole world that China and the U.S. are cooperative partners instead of adversaries."
Pentagon officials said, however, the simulated attacks are a sign China is prepared to go to war with the United States over the issue of Taiwan, which Beijing regards as a breakaway province and not an independent nation.
The vulnerability of U.S. troops in Asia to missile attacks is a sensitive issue. North Korea has deployed medium-range Nodong missiles that also can hit troops in both Korea and Japan, although the Pentagon has been reluctant to acknowledge the threat.
During the recent exercise, the Chinese mobile missiles were observed erected on truck launchers, but none was actually fired, said officials who declined to be named.
One military official said the exercises also showed China's growing capability to counter U.S. laser-guided bombs, using what the Pentagon calls "obscurance." The masking involves spraying clouds of small particles around the missiles that cause laser tracking devices to bounce off their intended targets and fool adversaries guiding the bombs into believing the weapons are on target.
The CSS-2 was the only intermediate-range missile ever exported. China sold a battery of the missiles to Saudi Arabia in the 1980s.
According to an earlier Pentagon intelligence report, China is engaged in a major program to upgrade its 40 CSS-2s with newer and more capable CSS-5s, which come in two versions. Liquid-fueled CSS-2s, with ranges of about 1,922 miles, are being replaced in some regions by solid-propellent CSS-5s that have a maximum range of 1,333 miles, the 1996 report said.
During the Taiwan straits crisis of March 1996, China fired short-range M-9 test missiles north and south of the island in what U.S. officials said at the time was an attempt to intimidate Taiwan shortly before its first presidential elections. Those exercises led the Pentagon to deploy two U.S. aircraft carrier battle groups to waters near the island.
Regarding the report due to reach Congress Jan. 1, the Pentagon has been held up from sending the report to the House Armed Services Committee because of disagreements with its conclusions. The senior official said the delay is due to "normal interagency discussion about an important national security issue" and that it will be sent to Congress "in a timely manner."
The report to Congress examines the possible components for regional missile defenses in Asia that would have the capability of protecting key regional allies from missile attack.
It was mandated by the fiscal 1999 defense authorization bill and will include descriptions of U.S. missile defenses that could transferred to key allies in Asia for "self-defense against limited ballistic missile attacks," according to the legislation requiring it.
According to officials familiar with the draft report, the Pentagon study shows that China is engaged in a major strategic missile buildup of several types of weapons that political officials are reluctant to publicize for fear of upsetting the Chinese government.
China's government is opposed to deployment of U.S. missile defenses in Asia because they could counter Chinese missiles.
The White House and State Department's East Asia bureau are said to be seeking to water down some of the harsh conclusions of the report, while the Pentagon and CIA want it to present unvarnished views of the Chinese missile threat, according to officials close to the debate.
Pentagon spokesman Ken Bacon said the China missile report is being worked on and could be released later this week or early next week, or "perhaps later."
Richard Fisher, a China specialist at the Heritage Foundation, noted that the Chinese may not view the June detargeting pledge to include shorter-range nuclear missiles, only long-range intercontinental ballistic missiles.
But Mr. Fisher said the targeting of U.S. forces in the recent exercise "highlights the most important aspect of any future Chinese military threat to the region."
"Chinese doctrine puts special emphasis on missile forces -- concealing mobile forces for obtaining surprise, and using a wide variety of current and future nuclear and nonnuclear warheads," he said.
The exercise also highlights the need to build regional missile defense for American forces in Asia and to help protect allies, he said.
Officially, the Pentagon said it does not know of the threatening missile-targeting activities.
Mr. Bacon said he would not comment on any specific intelligence report, "but I can tell you we are not aware of a simulated attack against U.S. troops in Asia during a missile exercise."
In a notice issued worldwide, the State Department said transportation could be disrupted and credit card and ATM machines may malfunction.
Americans with special medical requirements should not assume that medical facilities and services will be available overseas, the department added.
"Many businesses and governments are actively engaged in addressing potential Y2K (Year 2000) problems and may experience little or no noticeable disruption in essential services," the department said.
"However, others with more limited resources or expertise, or who are not paying appropriate attention to the problem, may experience significant difficulties," it said.
The announcement identified financial services, utilities, telecommunications, transportation and other vital services as the most likely areas of concern.
It did not cite specific countries where problems might occur, saying: "It is difficult to forecast where the Y2K problem will surface and some problems could even appear before January 1, 2000."
More specific information would be provided periodically as it becomes available, the department said.
Experts fear that computer programs may interpret the change from 1999 to 2000 as a reversion to 1900, playing havoc with a variety of services.
The upgrade, due to be completed in 2008, is designed to enable the IRS to catch more crooks and, someday, gather enough information to eliminate the need for most tax returns. Coleta Brueck, the IRS's top document-processing official (at the time of the article), explained how the system would work:
"If I know what you've made during the year, if I know what your withholding is, if I know what your spending pattern is, I should be able to generate a tax return so that I only come to you and tell you, 'This is what I think you should file for the next year, and if you agree to that, then don't bother sending me a piece of paper.'"
Mrs. Brueck, the IRS's Document Processing System project manager, described some of the IRS's plans. Chief among Brueck's wish-list is the so-called "Golden Eagle" return, in which the government automatically gathers all relevant aspects of a person's finances, sorts it into appropriate categories, then tallies the tax due. "One-stop service," as Brueck put it. The information would be fed to other government agencies as well, such as states and municipalities, which would draw upon it for their own purposes. She vows "absolutely" this will happen - apparently assuming that Americans will be grateful to be relieved of the burden of filing paper returns. The government will simply take its due.
Brueck is reported to have said:
"I am an excellent advocate of return-free filing. We know everything about you that we need to know. Your employer tells us everything about you that we need to know. Your activity records on your credit cards tell us everything about you that we need to know. Through interface with Social Security, with the DMV, with your banking institutions, we really have a lot of information, so why - at the end of the year or on April 15 - do we ask the Post Office to encumber itself with massive numbers of people out there, with picking up pieces of paper that you are required to file? I don't know why. We could literally file a return for you. This is the future we'd like to go to."
WASHINGTON -- Privacy groups will announce a boycott Monday of all products from Intel Corp. until the company agrees to disable new technology in its upcoming line of Pentium III computer chips that helps identify consumers across the Internet.
"Not even the tamest privacy advocate has failed to condemn it," said Jason Catlett, president of Junkbusters Inc. of Green Brook, N.J., which lobbies on a range of high-tech issues.
It organized the boycott with the Washington-based Electronic Privacy Information Center.
Intel spokesman Chuck Mulloy said late Sunday that the company hadn't been notified of the boycott. He said Intel has been in talks about its technology for several weeks with Junkbusters, and previously had meetings planned this week with both Catlett's group and the privacy information center.
Mulloy said it would be "difficult to tell" the potential impact of any boycott of Intel.
Intel, the world's largest chipmaker that has a major microchip-making factory in Rio Rancho, announced last week that its new Pentium III chip, to be sold within months, will by default transmit its unique serial number internally and across the Internet to help verify the identity of users.
Consumers can turn the feature off, but it turns itself back on each time the computer is restarted.
In addition to making about 85 percent of the world's computer processors, Intel also manufactures memory chips plus hardware for computer networks, communications and graphics.
Catlett called the Pentium III chips that already have been produced "toxic hardware."
"They should destroy them," said Catlett, who spoke last year at a summit on Internet privacy in Washington organized by the Commerce Department.
As part of their boycott, organizers will unveil a parody of the company's ubiquotous "Intel Inside" logo. Theirs features the same familiar swirl but with the words, "Big Brother Inside."
Intel said its technology is needed to encourage trust in Internet sales and also can be used to avoid piracy by preventing a single copy of a software program from being installed on several machines.
"That serial number can be linked in databases like your Social Security number is used by credit bureaus and marketing companies," Catlett said. "It allows a massive profile to be efficiently collected and sold."
Rep. Edward J. Markey, D-Mass., urged Intel on Friday to reconsider its plans, "to better balance both commercial and privacy objectives." Markey is the the senior Democrat on the House consumer protection subcommittee and active in Internet privacy issues.
Intel's announcement comes at an awkward time for the Clinton administration.
David Aaron, undersecretary of state for commerce, was to begin negotiations Monday in Europe -- the same day as the boycott announcement -- over a tough new privacy law enacted by the 15-nation European Union last October.
"It couldn't have come at a worse time," Catlett said. "This new feature from Intel is really throwing kerosene on the fire of the trans-Atlantic privacy negotiations."
Aaron must assure Europeans that the United States has adequate privacy protections or risk a prohibition against businesses in those 15 countries from disclosing personal information about citizens there to U.S. companies.
Aaron warned Friday that such a ban would carry "a very adverse impact on the operation of the economies on both sides of the Atlantic and could be a very serious blow."
The Electronic Privacy Information Center said it will meet later in the week with the Federal Trade Commission to discuss Intel's plans.
The FTC has criticized the online industry for its failure to protect privacy rights, and the agency successfully pressed last year for a new law that prohibits Web sites from collecting personal information from children without parental permission.
The FTC also is suing Intel for alleged antitrust violations. The trial is set to begin March 9.
Intel operates a major microchip-making factory in Rio Rancho, N.M.
WASHINGTON -- Nine pilots from the 103rd Fighter Wing of the Connecticut Air National Guard -- about 25 percent of its combat-ready fighter force -- have resigned from flying duties rather than take the Pentagon's mandatory anthrax vaccinations, saying they have concerns about possible health effects and question its value as a defense against the biological weapon.
All nine of the citizen soldiers, mid-level officers and veterans of Desert Storm, Bosnia and the Iraqi "no-fly" zones, left the reserve unit during the past month, said unit members.
While several dozen sailors, airmen and soldiers have been disciplined for refusing to take the six-shot anthrax program unveiled in December 1997, the nine A-10 "Warthog" pilots at Bradley Air National Guard Base in Granby, Conn., are the first officers to decline.
"There are some questions as to the effectiveness of it," said Tom Rempfer, a 33-year-old captain and Air Force Academy graduate, who decided to resign rather than take the inoculations. "The Iraqis or others could come up with a different strain."
Rempfer, a 12-year veteran pilot who deployed to the Persian Gulf last winter, said the pilots talked with superior officers over the past six months.
But their many questions and concerns were never addressed by the Pentagon, said Rempfer, leaving the local commanders "ill-prepared to help their troops."
Members of the unit were ordered to take the first shots before the doses expired Feb. 23. "They had to use it or lose it," said Rempfer, noting that some members of the fighter wing were slated to deploy to the gulf soon.
"There was an ultimatum: Get the shot or get grounded," said Dom Possemato, a major with 17 years' experience, who said reserve pilots around the country are raising concerns. The 42-year-old pilot questions the effectiveness of the shots and worries about possible health effects.
"I'm willing to let the Iraqis take a potshot at me and put me in a grave. I'm not willing to let my country do that," said Possemato, who along with the others favors an optional vaccination program.
"We're falling on our swords to get the word out. This is not well-tested. This is not well-proven."
Officials of the 103rd Fighter Wing either refused to comment or referred calls to the wing's press spokesman, who was not available.
"We've had an incredibly successful program," said Jim Turner, a Pentagon spokesman, noting that even with the resignations of the Connecticut pilots only "a handful" of service members have refused to take the shots.
THOUSANDS HAVE COMPLIED
As of Tuesday, 166,223 military personnel had begun the inoculations, he said.
Turner said the anthrax vaccine, approved by the Food and Drug Administration and in use since the 1970s, has resulted in only minor health effects, mostly sore arms. Defense Secretary William S. Cohen and Gen. Henry H. Shelton have been taking the shots, which are given over 18 months.
Cohen ordered all 1.5 million active-duty service members and 1 million reservists to take the vaccinations, with the first troops slated to be those heading to the gulf and other combat areas. The program is expected to take six years.
The Pentagon called for the program to counter the threat of biological attacks. Iraq is among those states with a large cache of anthrax, an infectious disease whose spores can be produced in dry form for weapons. It can be fatal even in microscopic amounts.
But Rempfer and the other pilots said the anthrax vaccine was developed for ranchers who come into contact with anthrax through the skin, not by a massive cloud. And they said Iraq could develop another strain of the disease -- or even use another biological or chemical agent that may make the inoculations worthless.
LINKED TO GULF WAR SYNDROME
Some critics think the vaccine may be one of the links to gulf war illness -- the collection of maladies including headaches, dizziness and nausea -- that affected thousands of troops who served there.
But Pentagon officials have said two independent studies have discounted any link between gulf war illness and the shots. And officials at Fort Detrick, which helped develop the vaccine, say it will stand up to any strains of the threat because the immune response is based on a component that is common to all strains of anthrax.
"My main concern is safety," said Peter Smith, a 32-year-old pilot with the 103rd who also resigned. "There have been no long-term studies."
There has been some long-term study over the years involving the anthrax vaccine and other immunizations given to lab workers and millworkers. Recently, officials at Tripler Army Medical Center in Hawaii started tracking physical reactions in 627 medical personnel who were given the anthrax shots.
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