August 2, 1990

August 2, 1990 | Backgrounder on Trade, Economic Freedom

Controls Still Needed on High Technology Exports to the U.S.S.R.

(Archived document, may contain errors)

I I 782 August 2,1990 CONTROLS SIltL NEEDED ON HIGH TEcHNoLOGY EXPORTS TO THE USS,R INTRODUCTION The United States needs advanced military technology to maintain a win ning edge against potential enemy forces. This need will continue despite the decline of the Soviet threat in Europe. For one thing, the Soviet Union re mains a formidable military power around the globe. For another, the U.S will need advanced military weapon systems to c o mbat terrorism, the spread of ballistic missiles in theThird World, international drug trafficking, and re gional challenges to U.S. interests. America thus must continue fielding bet ter weapon systems and equipment than its adversaries To protect its mi l itary technology edge in the past four decades, America carefully has restricted the sale .or other transfer of technology to its potential adversaries. These restrictions understandably are being reviewed in the wake of the real decline of the Soviet mil i tary threat in Europe. George Bush pro posed on May 2 sweeping reductions of the restrictions on selling advanced technology to the U.S.S.R. and other countries of the Warsaw Pact.The House of Representatives passed landmark legislation on June 6 to ease e x port controls. The-U.S. and its allies agreed in a June 6-7 meeting-in Paris to lift many of the restrictions on the export of high technologies to the Soviet Union and other countries. And then on July 17, the Senate Banking Commit tee approved its ver s ion of the House bill Case for Relaxing Bans. The dramatic changes in Eastern Europe make a persuasive case for easing some constraints on technology transfer. The fall of the Berlin Wall and the emergence of democracy in Eastern Europe, for ex ample, may entitle Czechoslovakia, Poland, and other countries to obtain Western computers, fiber optic cable, telecommunication equipment, and other high-tech products.

Judiciously easing restrictions does not mean wholesale repeal of them The restrictions should b e dismantled gradually, by stages determined by hard-headed assessments of the potential threats facing the U.S While re strictions must not become an anachronism, mindlessly locked in the fast-fad ing reality of the Cold War, they clearly must not jump a head of changes in the military balance. It has been American superiority in military technology that, perhaps more than anything else defeated the Soviet Union in the Cold War. Continued technological superiority is required to keep the peace.

The Bush Ad mkstration must devise a policy of technology transfer that balances a variety of needs: that of the emerging East European democracies for American technology; that of American technology firms for new markets in Eastern Europe; that of the U.S. not to b e left far-behind as the West Euro peans and Japanese sell technology, with almost no restriction, to Eastern Eu rope; and that of the U.S. to defend itself against current and future adversar ies 1 The components of such a policy would be for the U.S. to C ontinue as leader in the Coordinating Committee for Multilateral Export Controls (COCOM Founded in 1949, COCOM coordinates the ex port policies of advanced industrial nations to prevent the Soviet Union and its allies from obtaining sophisticated military technologies from the West. Its membership includes Japan, Australia and all NATO members except Ice land. COCOM is currently easing export restrictions. Washingtons COCOM leadership is being challenged by other members, particularly Bonn. The Ad ministra t ion should fight to keep its leadership. The reason: if U.S. leadership is eclipsed, those COCOM members who seek fewer restrictions on technol ogy transfers to the Soviet Union will dominate COCOM and thereby allow the Soviets to obtain Western technolog y important to its military Maintain the COCOM standard of controlling strategically signifi cant technologies. Because modern militaries depend on a variety of indus trial products to improve the combat effectiveness of their military forces controlling t h e export of computers, machine tools, electronic equipment and similar products protects U.S. security. COCOM has used what it calls the standard of strategic significance to determine which technologies should be denied to the Soviet Union and its allies . Strategically significant technologies are defined as those that increase the effectiveness of military establishments in adversary countries; examples include supercomputers and advanced sensor systems. This standard would be weakened if a COCOM re vise d list of what are called industrial commodities ignores the standard of 1 U.S. Department of State, Gist, US Exports: StrategicTechnology Controls, April 1990 2 strategic significance. Attempts to weaken the strategically significant standard should be re s isted mocracies of Eastern Europe and the Soviet Union. If the new democracies of Eastern Europe quit the Warsaw Pact militaq alliance, they would be di vorcing themselves from military and intelligence cooperation with the Soviet Union. These countries t h en would pose only a minimal military threat, if any, to the U.S. and the West. At such a time, the U.S. should lift restrictions on the export of advanced technology to these countries. At the same time strict rules must prevent them from transferring mi l itarily significant technol ogies to the Soviet Union Ease restrictions on export controls to the Soviet Union only as Mos cow reduces military spending and capabilities. The Soviet Union is still a military colossus, fielding 30,000 nuclear warheads, rou g hly 50,000 tanks, and 4.5 million troops. It remains the only country that presents a mortal threat to the U.S and its allies. The U.S. should ask COCOM to reaffirm that the sale of strategically significant technologies to the Soviet Union will be restri c ted unless there is a substantial decline in Soviet military capabilities across the board Ask Congress for a one-year extension of the Export Administration Act (EAA The EAA is the statute establishing the guidelines for which U.S technologies can and ca nnot be exported. It expires this September

30. The House of Representatives on June 6 passed a sweeping revision of the EAA greatly weakening controls on the export of advanced technologies. The Bush Administration however seeks a one-year extension of t he EAA. This exten sion is needed to give COCOM time to complete a major review of its poli cies. The Congress should not short-circuit U.S. export policy by underminhg Bushs negotiating position in COCOM Develop an export policy that distinguishes betwee n the emerging de PROTECTING THE WESTS LEAD IN MILITARY TECHNOLOGY The Coordinating Committee for Multilateral Export Controls, or COCOM, was established in 1949 to prevent the export of strategically signifi cant technologies and commodities to the East. S uch technologies have been computers, machine tools, and electronic equipment, which can be used to manufacture such advanced weapons as self-guided rockets and elaborate mil itary command and control systems, and to make submarines more difficult to trac k. Seventeen countries participate in COCOM: the U.S Australia, Bel gium, Britain, Canada, Denmark, France, West Germany, Greece, Italy Japan, Luxembourg, the Netherlands, Norway, Portugal, Spain, and Turkey.

These countries have agreed to prohibit the exp ort of those technologies des ignated by the unanimous agreement of COCOM members. The COCOM headquarters, or secretariat, is located in Paris and serves as the administra tive arm of COCOM 3 COCOM Responsibilities. COCOM serves three major functions. Fir s t, it requires each member country to establish national control lists of equip ment that legally cannot be exported to the Soviet Union and its allies. Com mon guidelines are established for the export of products like microelec tronic equipment, telecom m unication systems (telephone computer modems for example and such navigation devices as modem avionic equipment for aircraft. For the U.S the Department of Commerce maintains the list of con trolled products, called commodities (on what is officially know n as the Com modity Control List in consultation with the Departments of State and De fense. The U.S. Customs Service is the agency primarily responsible for en forcing U.S. export control laws and regulations.

Second, member governments of COCOM are requi red to review exports of most industrial commodities to prevent their diversion from their pur ported destination such as Austria, for example to the Soviet Union or its allies. In the U.S. this is done primarily by the Commerce Department, which grants e x port licenses for industrial goods that utilize modem technology. An American exporter who wishes to export relatively unsophisticated machine tools, for example, must apply for a license to sell the product in the Soviet Union. The Commerce Department re v iews the application and grants a li cense to the exporter if the technology is not subject to an export ban. The Commerce Department last year reviewed some 1,800 such applications for export licenses to the Soviet Union and granted 1,251 Third, COCOM co o rdinates the licensing practices for strategic exports of the member governments. Individual COCOM nations are required to obtain permission from COCOM to grant export licenses that allow the export of the most sophisticated commodities. Further, COCOM co o rdinates enforce ment policies. For example, COCOM harmonizes the procedures of all mem ber governments for inspecting export shipments to ensure that restricted items are not diverted to the Soviet Union THE RUSH TO EASE EXPORT CONTROLS The fall of the B e rlin Wall and the collapse of the Warsaw Pact have con vinced some COCOM governments and some members of the U.S. Congress that the Soviet military has weakened significantly.They thus argue for relax ing controls over the export of militarily significant technologies not only to the emerging democracies of Eastern Europe, but to the Soviet Union as well. Said Representative Don Edwards, the Democrat of California, on the House floor last June 6 the events in Europe and the Soviet Union over 2 General Acco u nting Office, Export Controls US. Policies and Procedures Regarding the Soviet Union Washington, D.C., lw p. 11 4 the past year have brought dramatic changes not only terms of national secu rity and military strategies, but also in terms of international t radeT3 The campaign to relax export controls is led by American and foreign busi nesses that seek markets in Eastern Europe and the Soviet Union. Among U.S. companies pressing for lighter controls are International Business Ma chines Corporation, Digital E quipment, Inc and AmericanTelephone and Telegraph Company. The U.S. Chamber of Commerce supports the House of Representatives bill to loosen export controls. In the House, the most outspo ken advocates of eased controls are Connecticut Democrat Representa tive Sam Gejdenson and Wisconsin RepublicanToby Roth. The foreign govern ment pushing hardest for eased export controls is West Germany. In fact, pro posals were made last year in the West German Bundestag, its parliament, to abolish COCOM altogether.

Resp onding to Pressure. This pressure has had an impact on the Bush Ad ministration.The White House announced on May 2 that the U.S. would re vise its export control policy. The Administration proposed that COCOM es tablish a completely new list of controlled technologies. Over 40 of the exist ing 120 categories of restricted commodities will be either partially or com pletely eliminated.

Certain categories of computers, telecommunications equipment, and ma chine tools, labeled priority sectors by the Bush Adm inistration, receive special attention in the proposal. Computers with data processing rates of 275 megabits per second (mps a rate roughly equivalent to that found in an IBM PS 2 personal computer, were taken off the list of controlled technologies.

Computers with a data processing rate of up to 550 mps, which is similar to that of the very large IBM 3081 mainframe computer, can also be exported so long as the customers are civilians and not associated with the military.

Communications for Eastern Europe . The Bush proposal also relaxes con trols on the export of telecommunications equipment, including fiber optic equipment with a transmission level of 156 megabits, to the emerging democ racies of Eastern Europe. Fiber optic equipment transmits computer d a ta by light impulses across a very thin, glass-like silicon tube. This equipment would give East Europeans the ability .to provide the sorts of communications ser vices generally available in the U.S. Example: they could develop high-quality fax machine n etworks and use the telephone to check credit card numbers when making purchases in stores. Finally, the Administration lifted all con trols on machine tools with a cutting accuracy of plus or minus 2 or 3 microns.

A micron is. 000039 inches! The previous standard for exports to the Soviet Union was around 10 microns 3 Congressional Record, June 6,1990, p. H3278 4 White House Press Ofice, Comprehensive U.S. proposal for Modernizing COCOM, May 2,1990 5 The White House proposal significantly eases U.S. expor t controls. While the primary impetus for the change in policy came from the Commerce De partment, both the State Department and Pentagon approve the changes.

Some technologies exported to the Soviet Union under the new U.S. rules including computers and m achine tools, could be used to manufacture weap om. Machine tools, for example, could produce engine parts and chassis for tanks and armored personnel vehicles. The machine tools illegally exported to the Soviet Union in the 1980s by the Japanese companyT o shiba Corpora tion are being used to produce high-quality submarine propellers, making So viet submarines quieter and thus more difficult to detect by the U.S. Navy CONGRESS ACTS TO EASE EXPORT CONTROLS The House of Repgesentatives, on June 6, voted 312 t o 86 for H.R. 4653 to ease export controls. The six key provisions to the House bill are 1) The elimination of U.S. export licenses on commodities destined for COCOM countries and other non-member countries which cooperate with COCOM, effective September 3 0 ,1991.This would eliminate the need for U.S. manufacturers to apply for export licenses so long as the recipient coun tries are cooperating with COCOM in controlling exports 2) The decontrol of all commodities whose technological sophistication is equal t o that currently permitted for exports to the Peoples Republic of China (PRC The only requirement would be to noti

other COCOM na tions of the exports. This standard of relative technological sophistication is commonly referred to in COCOM as the PRC Greenline. Advocates of this proposal argue that these products are unsophisticated and would no longer be helpful to t he Soviet military 3) A favorable consideration of license applications for the sale of com modities more sophisticated than those exported to the PRC.These exports however, could only go to civilian customers in Eastern Europe who, accord ing to the bill , do not have interests adverse to America and its allies. They could not go to the Soviet Union or hostile nations in Europe unless ap proved case-by-case. The application for licenses for civilian exports to East em Europe would be largely formal because the Commerce Department would likely approve most of them under the new liberalized rules 4) A thorough review of all commodities on the so-called control.list of exports to controlled countries. The first step in this process would be to elim inate all c o mmodities on the list. The second step would be to establish a spe cial review to determine which commodities should be reinstated on the con trol 1ist.This process will require a fresh review for every item; only those 5 Congressional Record, June 6,1990 , pp. H327GH3355 6 that can be justified would remain on the list.The first review is to take place by October 1,1992; subsequent reviews are to occur every two years 5) Restrictions on the jurisdiction of the Pentagon in reviewing export li censes. As a r e sult, the Commerce Department would approve the vast major ity of export license applications without consulting the Pentagon 6) Increased penalties for violating export control. The maximum prison terms and fines for willful violations of export controls would be increased from the current ten years and $1 miUion to twenty years and $2 million!

An amendment to the Export Facilitation Act (H.R. 4653 sponsored by Representative Richard Durbin, the Illinois Democrat, was adopted by the House on June

6. It established the requirement that the Soviet government enter negotiations with Lithuania before controls on exports to the Soviet Union could be eased?

Bush Administration. The House would reduce severely the jurisdiction of the Secretary of Defense in ex port control policy. It also would put the bur den of proof on those wishing to prevent the export of a particular commod ity.The reason: all commodities will be removed from the list and those re turned are required to be reinstated with justification. U nder current law the burden of proof rests with those whose wish to remove a product from the control 1ist.They must prove that the technology used by a product would not enhance the military capabilities of the Soviet Union and its allies.

Senate Action. The following month, on July 17, the Senate Banking, Hous ing and Urban Affairs Committee, which has jurisdiction over export con ntrol legislation in the Senate, drafted a companion bill to the one passed by the House. The Senate Committees bill codifies the export control standards already announced by Bush and COCOM. It also adds provisions to: 1) autho rize the U.S. Export-Import Bank, a U.S. government agency that insures ex port sales, to back sales of defense items; 2) impose trade sanctions on Iraq and 3) impose trade sanctions on companies from non-COCOM countries such as South Korea and the Republic of China on Taiwan, if they violate ex port restrictions after agreeing to guard against technology transfers to the So viet Union. The Senate Banking Committee staff is still drafting the report to accompany this legislation The House bill would liberalize export cbntrols much more than would the 6 House of Representatives, Committee on Foreign Affairs, Report on the EqwH Faditation Act of 199U, lOlst C ong 2nd session, H.Rept. 101-482 (Washington, D.C GPO, lm pp. 2-3 7 Congressional Record, June 6,1990, pp. H3293-H3300 7 THE COCOM REVIEW PROCESS The COCOM review process will be long and complicated. AU COCOM members have agreed to the Bush Administratio n proposal to revise the In dustrial List of controlled technologies.This list names the industrial com modities, like advanced electronics and supercomputers, that COCOM coun tries agree not to export to the East. A new list is to be written from scratch by COCOM members and the work will be completed by the end of this year The U.S. and other COCOM members will submit their proposals for the re vised list by September 15.

A new set of categories for technologies will be created in the new list.

These are : 1) electronics; 2) advanced materials; 3) telecommunications equipment 4) sensor systems; 5) navigation and avionics equipment; 6) ma rine technology 7) computers; 8) propulsion systems. These categories have been established to ensure that all member c ountries have the same catego ries of controlled commodities. The final result is certain to be a shorter list of embargoed commodities, which is why it currently is being referred to as the core list.

Removing Controls. COCOM at its June 6 and 7 meeting a dopted the Bush Administrations May 2 proposal to ease controls in the priority sectors of computers, telecommunications equipment, and machine tools. Then on July 1, COCOM deleted 30 commodities from the industrial list, including vac uum pumps and metal rolling mills. An additional eight items, including so phisticated cameras and robots, will be taken off the list on August

15. The ex port rules governing seven items on the industrial list, such as materials used to manufacture integrated circuits, were also changed on July 1, allowing ex port to the Soviet Union if other COCOM members were notified of the sale.

The June 6 and 7 COCOM meeting also created a temporary list for con trolled exports to the East Germany. Only the most sophisticated technolo gies, including submarine and laser technologies, are subject to stiff restric tions against export to the East Germany. Until German unification is com plete, and a new set of rules are promulgated, the new rules require busi nesses of COCOM members to give advanced notice of exports to East Ger many. When Germany is unified by December of this year, the temporary list will cease to apply and the entire German state will become a full member of COCOM.

Taking Precautions. Finally, the COCOM meeting set le ss restrictive stan dards for exports to Czechoslovakia, Hungary, and Poland which could take effect if these governments take precautions against diverting technologies to the Soviet Union.They would have to end all intelligence cooperation with the Sovi e t Union and ensure that the goods are used solely for civilian pur poses.The final decision to make any of these countries eligible for the lower standards will be made collectively by COCOM members at a later date 8 FOUR MYTHS ON EASING EXPORT RESTRICTIO N S The case for fewer restrictions on the export of advanced technology to the Myth #1: Giving the countries of Eastern Europe high technologies is the Representative Sam Gejdenson of Connecticut and others argue that Soviet Union and its allies is based o n four myths.They are key to modernizing their economies Czechoslovakia, Hungary, Poland and other emerging democracies in East em Europe will not be able to modernize their economies without high tech nology equipment.They cite the need for modem telecomm u nications for the banking system, computers for business management, and automated produc tion equipment for food processing. A May 10,1990, report by the House Foreign Affairs Committee states: As long as one cannot pick up a phone and get a dial tone in Warsaw, and as long as Hungarys banking system and hotel reservation system lack up-to-date computers, the economic develop ment of Poland and Hungary, and other countries in Eastern Europe will be retarded, thereby making it more difficult to maintain th eir economic and po litical independence from the Soviet Union.

It is true that Eastern Europe will need some advanced technologies, partic ularly in telecommunications, but reliable and affordable technologies Will be more important than sophistication. W hat Hungarian and Polish industries need are machine tools to produce reliable consumer products, not expensive and highly sophisticated technologies to produce high quality propellers for submarines. The key to Eastern Europes economic future is economic re form, not advanced technology. Economic policies that encourage productiv ity and efficiency will do more to promote economic growth than high-tech nology which the relatively backward economies of Eastern Europe may not in some instances be able to ab s orb.To rely on high technology to transform East European economies is to repeat the mistake made in the past quarter centurys failures to transform the African economies Myth #2: Export controls on high technologies prevent U.S. companies from exporting to Eastern Europe and the Soviet Union.

Some U.S. business leaders believe that the U.S. export control policy on high technology is the rinci al barrier to U.S. exports to Eastem Europe and the Soviet Union. But only 6 percent of the dollar value of U.S. exports to the U.S.S.R. and its allies have been subject to export bans since 1987.

Only high technology manufactured products such as advanced computers or microelectronic equipment are prohibited. All other goods can be exported BP 8 House Committee on Foreign Affairs, op. cit p. 9 9 GAO, op.cit pp. 18-19 9 although some are subject to a license requirement. Some 85 percent of ex ports to the Soviet Union are agricultural products and not subject to controls at all. And, of the 3.6 billion worth of U.S. products licensed before export to the U.S.S.R. from 1987 to 1989, about $2.6 billio n was approved for ex port.l0 Nothing in the current export control law prevents U.S. businesses from exporting fertilizers, food, oil production equipment and a vast variety of other products to most countries in the world. U.S. export controls are not a serious economic barrier to trade with the East Myth #4: The Soviets already have obtained the technology they want from spying on the West.

Though Moscow does steal Western technology, Soviet spying and illegal purchases clearly do not make U.S. export co ntrol policies meaningless.The Pentagon calculates that of the 32 categories of deployed weapon systems lolbid p. 1 11House Committee on Foreign Affairs, opxit p. 13 12Department of Defense, Soviet Militaty Powerhspecfs for Change 1989 (Washington, D.C.: G PO, 1989 p. 137 10 the U.S. has more sophisticated weapon systems in fifteen, includihg strategic bombers, ballistic missile submarines, and sea-based aircraft.13 Were the So viet spy program able to obtain advanced technologies from the West at will Sovi e t weapons would be on a par with U.S. weapons. The Soviet spy pro gram, despite its vigor, cannot by itself close the gap between the Soviet Union and the U.S in advanced military technologies. Moscow must rely on technology imports to do that A PRUDENT P O LICY OF EXPORT RESTRICTIONS Most COCOM members have more lenient standards on restricting high technology exports to the East than the U.S and they are seeking even lower standards. While they argue that high technology exports to the new demo cratic gove r nments of Eastern Europe will help these countries modernize their economies, the main motive for COCOM members to push for lower re strictions is to give their domestic industries expanded export markets. It is up to Washington as it has been for nearly a half-century, to make it clear to the other COCOM nations that collective security must not be sacrificed for the sake of potential export markets for specific industries.The Administra tion can do this by Maintaining U.S. leadership in COCOM. The U.S. s h ould remain COCOM leader. There have been occasions, particularly last year, when the U.S. has been the sole opponent of proposals to ease export restrictions.This happened during an October COCOM meeting in Paris. Because COCOM makes decisions only by un a nimous consent, a firm U.S. position can prevent or slow an opening of the floodgates on technology exports to the Soviet Union. The U.S. should block the decontrol of particular commodities after the new core list is established. If the U.S. refuses to o k ay decontrolling a par ticular commodity, it will not be taken off the list. Other COCOM members may be tempted to propose easing export restrictions on specific items after the completion of the current review.The U.S. should resist this as it could beco m e an indirect way to eliminate all export restrictions as the more lax members of COCOM continually whittle away at the list of restricted cam modities icant technologies. COCOM soon will create a new core list of controlled commodities. The traditional s t andard for COCOM in determining what items to restrict has been what is called strategic significance, or whether the particular product would increase the military effectiveness of the Soviet Union and other targeted countries. This standard was abandone d by the June 6 and 7 COCOM meeting. At that time the organization adopted a new Continuing the COCOM standard of controlling strategically signif 13Department of Defense, op.cit p. 134 11 standard, called strategic criticality. COCOM has not specifically d efined this term, but says that the standard would consider the inherent controlla bility of a commodity. This implies that COCOM members may argue that a specific item should be excluded from the new core list not because it will not be useful to the Sov iet military but because it may be difficult to control As it designs its own core list, the Bush Administration should adopt as guide lines for strategic criticality those that it had for strategic significance.

The basic standard for controlling the flow of high technology to the Soviet Distinguishing between exports to the Soviet Union and the new de mocracies in Eastern Europe. The emerging democracies of Eastern Europe specifically Czechoslovakia, Hungary, and Poland, should be exempted from strict CO C OM restrictions if they continue to divorce themselves from their military and intelligence relationships with the Soviet Union. As democratic nations, these countries pose no significant military threat to the U.S. and its allies. The new, lower standard s for exporting high technology commodities to the emerging democracies of Eastern Europe, however, should take effect gradually. These countries have been members of the Warsaw Pact for over 40 years. Military and intelligence ties to the Soviet Union wil l not dissolve overnight. As these ties are loosened, COCOM restrictions can be eased. At the same time, COCOM must impose on the new East European govern ments strict rules against transferring Western technology to the Soviet Union. COCOM will have to de velop new ways to enforce the rules, perhaps requiring the exporter to identi

the customer and to reveal the stated pur pose for which the product is intended. Periodic inspections to ensure compli ance with regulations will be required l Union and other controlled countries should remain the same Ensuring strict controls on exports to the Soviet Union. The Soviet Union (or even an independent Russia) will remain a significant military threat to the U.S. and its allies long into the future.The Soviet stra t egic mod ernization program continues, and as its conventional forces shrink, Soviet generals will seek through advanced technologies to achieve what American military experts call force multipliers, which enhance the capability of the combat force using t hem.14 The U.S. should insist that COCOM link further relaxation of export restrictions to the U.S.S.R. to a demonstrable decline in Soviet military capabilities.The West should demand that Moscow deploy a military force no larger than needed for defense o f Soviet territory. For U.S export policy toward the Soviet Union to be relaxed almost completely, the Soviet Union would have to become a multi-party democracy with a market based economy; this is the best way to ensure friendly intent toward the West 14 Since an highly accurate air-to-air missile, for example, is three times more likely to hit its target than earlier models, the same mission can be performed with only a fraction of the planes carrying such missiles. Hence the force multiplying effect of t he more accurate missile 12 Barring these actions the Soviet Union should not be eligible for high tech nology exports from the West the midst of revising its export control policies. This, therefore, is not an ap propriate time for Congress to revise U.S . laws governing the sale of ad vanced technology to the Soviet Union and Eastern Europe. Doing so would undercut the Administrations negotiating authority with other COCOM members, and confuse both allies and adversaries about the direction of U.S export p olicy. Instead, the Bush Administration should seek a one-year exten sion of the Export Administration Act This will keep the existing law from ex piring while new policies are established through COCOM Extending the Export Administration Act for one year . COCOM is in CONCLUSION The Bush Administration is facing extraordinary pressure from business in terests, large blocs in Congress, and even from allied governments to aban don nearly all restrictions on the export of advanced technologies to the So viet U nion and other Warsaw Pact nations. Resisting these pressures and maintaining a credible program for restricting the flow of militarily significant technologies to the U.S.S.R is necessary if the U.S. wishes to maintain its global military technology adva ntage.

The Soviet threat may be diminishing in Europe, but it remains elsewhere in the Pacific, in Asia and above all in a vast nuclear arsenal aimed at the U.S. In countering the Soviet threat, the West has never attempted to match the Soviets missile for missile or tank for tank. It has compensated for the smaller size of its military forces by maintaining a lead in advanced technolo gies with military applications.

Overstated Benefits. The U.S. can and should ease restrictions on technol ogy exports to the emerging democracies of Eastern Europe. At the same time, policy makers must recognize but the benefits of expanded high technol ogy exports to Czechoslovakia, Hungary, Poland, and others are overstated.

Economic and political reform are far more impo rtant to modernizing these countries economies than access to supercomputers and other sophisticated technologies. Similarly exaggerated are the benefits to American manufactur ers of loosening the restrictions on high technology exports. Existing restric tions cover relatively few products, and lifting them would assist only a select group of U.S. companies. The vast majority of American companies never have faced export restrictions.

To maintain the Wests lead in militarily significant technologies, the Bush Administration needs to maintain American leadership in the Coordinating Committee for Multilateral Export Controls. Inaddition, the Administration should insist on maintaining strategic significance as the standard in deter mining what products COCO M countries cannot export. This standard will prevent Moscow from obtaining those technologies needed to modernize its military and improve its combat effectiveness To Moscow, the Bush Administration should say that 'the U.S. will not ease controls on high technology exports unless there is a substantial decline in So viet military capabilities throughout the globe.

The political and military changes in Czechoslovakia, Hungary, and Poland warrant some easing of export controls to these countries.They should be al lowed to obtain all but the most sensitive technologies, such as submarine components. Nevertheless, the Administration should require these countries to prevent the transfer of restricted technologies to the Soviet Union.

Finally, the Administrati on should request that Congress extend for one year the Export Administration Act, the statute that governs U.S. export con trol policy.The Administration is negotiating with U.S. allies to revise export control policies. U.S. negotiating leverage should not be undercut by Con gress enacting major revisions in the Export Administration Act.

Balancing Competing Interests. This is not the time for the U.S. to aban don export controls and give up what has been the trump card of Western se curity its clear adv antage in military technology. What the ongoing changes in Eastern Europe and the Soviet Union require is a careful review of export control policies and the easing of restrictions based on a clear-eyed assess ment of the risks to Western security.This wi l l require that the Bush Adminis tration establish a policy that properly balances the competing interests of East European economic modernization, expanded foreign markets for U.S producers, and American and allied security. Given the fact that the Soviet Union retains an extremely potent military force, Western superiority in mili tary technology is still essential to maintaining a military balance and world peace. Until the Soviet Union dismantles its huge conventional and strategic forces, the U.S. has no choice but to restrict the flow of advanced technolo gies to the U.S.S.R.

Baker Spring Policy Analyst 14

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