-Caveat Lector- China Says U.S. Charges Are Just Tall Tales BEIJING, May 26, 1999 -- (Reuters) China's Communist Party newspaper said on Wednesday that U.S. charges that Beijing donated to American election campaigns was a tale tall enough for the "Arabian Nights". "To paint China as an evil demon, the United States has made up all kinds of stories from the Arabian Nights," the People's Daily said in a commentary. That was the same phrase Premier Zhu Rongji used in March to describe allegations that China had stolen U.S. nuclear weapons secrets. The newspaper did not address the spying charge central to a special Congressional report which has further damaged relations already strained by disputes over human rights and trade -- and the NATO bombing of Beijing's embassy in Belgrade. The People's Daily focused its scorn on a charge in a report by a select House panel headed by Representative Christopher Cox, a California Republican, that China donated to the Democratic campaign in 1996 to gain influence. It said there was no evidence to back up the allegation, which "makes one laugh his head off". The Cox report said a network of "princelings" -- sons and daughters of China's political elite -- exploited commercial and political connections to obtain new military technology for China and funneled campaign donations to the U.S. Two of the most notable "princelings", Liu Chaoying and Wang Jun, became directly involved in illegal activities in the United States, including the 1996 Democratic fund-raising scandal, the report said. A $300,000 donation funneled by Liu from Chinese military officials to Democratic fund-raiser Johnny Chung in 1996 was meant to help position them to acquire U.S. computer, missile and satellite technologies, the report said. Liu, the daughter of a retired senior military officer, funneled the donation to Chung from the chief of Chinese military intelligence, Ji Shengde, in August 1996. Chung testified to another House panel earlier this month that he eventually gave only $35,000 of the amount from Ji and Liu to the Democrats. Liu is also a vice president of the Hong Kong subsidiary of China Aerospace Corporation, the organization that manages China's missile and space industry. The People's Daily commentary argued that donating just $300,000 to a U.S. election which costs billions of dollars would be "too cheap". "If China believed the United States is a country where money could move the ghosts to do anything, it is unlikely that China will just give $300,000 no matter how poor it is," its said. Chinese Foreign Ministry spokesman Zhu Bangzao dismissed the espionage allegations on Tuesday as "groundless" rumors spread by people "with ulterior motives" and a Cold War mentality that needed an enemy now that the Soviet Union was gone. The People's Daily also slammed the U.S. defense that it mistakenly bombed the Chinese embassy in Belgrade because outdated maps were used. "This is too disgraceful to the United States -- the wealthiest, militarily strongest, technologically top-notch and the most efficient country in the world," the commentary said. The May 7 bombing, which killed three Chinese journalists, incensed China and set off three days of government approved protests, mainly directed at the U.S. embassy in Beijing, which turned violent. For U.S. media and politicians to play up the allegations in the wake of the bombing make it "seem like China is the one bullying the United States", the commentary said. ((c) 1999 Reuters) © 1999 European Internet Network Inc. 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