Not So Fast!

Hi Everyone,

By now we have all heard of or have read about hackers, hacking into Target, Home Depot and other chain stores. Hackers were even able to get into the supposedly secure J.P. Morgan computer system. What we have also learned is that the majority of these hackers are from Russia and China. I am not going to get into how these companies get hacked, other then saying that maybe they should pay more to get a better firewall or whatever they need to stop the hackers. Today's blog is about a smaller scale business that will have ore important consequences.

For those of you not in the know, on 10/6/14, Hilton Hotels Corp. sold their iconic, flagship hotel, The Waldorf=Astoria, (yes it is correct to use the equal sign, which is another story) located at 301 Park Ave., between 49th and 50th streets, for $1.95 billion. Under normal circumstances, other than the price tag, this would be a non story. Unfortunately though, the sale of this iconic hotel may result in serious implications that may actually harm our national security. How is that possible, you may be thinking?

Before I answer that question, let me preface my answer by stating that I worked at the Waldorf=Astoria as their Assistant Director of Personnel for years, back in the early 80's; before being promoted to another Hilton hotel. Consequently, I have the inside scoop on why national security may be in jeopardy due to the sale. First of all, the company who bought it is Anbang Insurance Group. So what's the big deal? Anbang is a Chinese company, which is based in Bejing, China. Terms of the sale allow Hilton to manage the hotel for the next 100 years and also calls for a "major renovation". Since we are aware of China's ability to hack into American company's computer systems and their eavesdropping capabilities, why would this sale be problematic? What many people don't know is that for the  past 50 years, the U.S. State Department has leased a residence on the 42nd floor for the home of the U.S. ambassador to the United Nations. When I worked at the Waldorf, Jeanne Kirkpatrick was the U.S. ambassador to the U.N. and lived in the residence. Yes there was security to protect the residence, but that is not the big issue here. In addition to the residence, every president of the U.S. since FDR has stayed in the Presidential Suite. There are lots of other heads of state from other countries that stay there. Also, hundreds of U.S. diplomats stay at the hotel during the annual U.N. General Assembly. As a side note, back in the day, (I am not sure if they still do it), whenever a head of state stayed at the Waldorf, their country's flag was prominently displayed above the Park Ave. entrance. The U.N. even borrowed some of the Waldorf's flags that they didn't have.

As I stated, under the terms of the sale, a major renovation will take place. So let's look at what will most likely happen with the renovation. As in the case with the U.S. embassy built in Moscow, in the 80's, eavesdropping devices were installed throughout the embassy; even with U.S. contractors overseeing the construction. Knowing who lives and stays in the hotel, does anyone think that China's government won't want to install eavesdropping and other electronic devices everywhere? I believe that not only would they want to, but will do it in a heartbeat. China could then listen to every conversation that the U.N. ambassador has, but also, every U.S. president, all the diplomats, heads of state and U.S. elected officials who stay there. Especially during the annual Al Smith dinner. What a freakin gold mine for the Chinese government; where they would have instant access, in real time, of any and all sensitive conversations that takes place. This just can't ever happen!!!

The way I see it, there are only two common sense options. The first is that the U.S. State Department immediately stops using the 42nd floor and doesn't allow any U.S. presidents, diplomats or any other elected officials from staying there or have any meetings there. Obviously any CEO's of any company who stays there would be fair game for China to listen to for their own benefit and profit. The second option is for the sale not to be allowed, which I am sure there would be lots of people against that due to government interference in a private sale.

I can't imagine that the U.S. State Department would allow anyone to stay there which could jeopardize our national security. When I was at the Waldorf, President Reagan stayed there a couple of times. Six to nine months prior to Reagan's visit, the Secret Service task force was in the hotel, having highly classified meetings with executive management to discuss security and background checks on all current and all recently (past 6 months or so) terminated employees. What a windfall for the Chinese government to learn how the Secret Service and NYC police departments protect the presidents who stay there and their minute by minute and day to day schedules, along with any other high profile guests.

FYI, there are many reasons why the Waldorf is used for the U.N ambassador residence and presidential, other dignitary and heads of state stays. The Waldorf has a private, drive through the building's entrance, which keeps prying eyes away. There is limited access to the towers where these dignitary's stay. And it is located in mid-town, where it is semi-close to the U.N.

Lastly, why is it that the U.S. State Department routinely warns U.S. diplomats in China about physical and electronic surveillance and tells Americans in the country to be aware of similar risks, especially in hotels? Because that is what China does!

If the sale can't be reversed, which I think is the best option, then the only common sense option is for the State Department to immediately stop using it and to find another hotel to use asap! Obviously they can't take the chance of using the Waldorf anymore. Which by the way, will be detrimental to the new owners bottom line. Oh well!

Common sense must rule here, without any second thoughts.

Til next week.

Peter