27 March 2001
Source:
http://usinfo.state.gov/cgi-bin/washfile/display.pl?p=/products/washfile/latest&f=01032201.clt&t=/products/washfile/newsitem.shtml
US Department of State
International Information Programs
Washington File
_________________________________
22 March 2001
(Bush administration signals support for changes) (850) By Bruce Odessey Washington File Staff Writer Washington -- With the Bush administration signaling support, a Senate committee has approved a bill that would reform the Cold War-era law for advanced technology export controls. In a March 22 session, the Senate Banking Committee voted 19-1 to approve the bill, which is viewed by some observers as having a good chance of becoming law. President Bush's national security adviser, Condoleezza Rice, sent a letter March 21 to committee Chairman Phil Gramm explaining that she and the secretaries of state, defense and commerce would support the bill if it included a few suggested changes. By voice vote the committee approved an amendment that Gramm said included most or all of the administration's suggestions. Essentially the same bill was approved by the Banking Committee 20-0 in the previous session of Congress. A small group of opponents employing delaying tactics, however, succeeded in blocking full Senate consideration of the bill. At issue is the Export Administration Act (EAA), which regulates exports of computers, machine tools and other dual-use technology -- goods that have both military and civilian applications. The U.S. Department of Commerce enforces those regulations. Attempts to reform the EAA failed 12 times in the 1990s over disagreements between exporters on one side and national security interests on the other. The EAA lapsed in August 1994, and export controls were maintained under emergency law until late in 2000 when Congress finally passed a bill that extended EAA retroactively and through August 20, 2001. Gramm said the Banking Committee bill intends to eliminate controls on items no longer controllable and to strengthen controls for the remaining crucial items -- "to build a higher fence around a smaller number of things." The bill would effectively eliminate U.S. export controls on technology available from foreign sources or available in mass-market quantities. It would allow the administration to anticipate changes in controls because of rapid changes in availability or in technology. It would require the administration to develop a guidance system for exporters by assigning countries to different tiers representing different levels of threat to U.S. national security. It would sharply increase penalties for export-control violations although, at Bush administration request, the committee halved the proposed top penalties -- to $5 million per criminal violation and $500,000 per civil violation. The bill would require timely resolution of inter-agency disputes over decontrolling any item, but also elevate the Defense Department's participation in the process. It would instruct the president to press other countries to improve their own export-control systems and to cooperate to strengthen multilateral export-control regimes, including the much-derided Wassenaar Arrangement on dual-use items and conventional arms. The amendment approved by the committee included the administration's suggestions for giving the president more flexibility to maintain existing controls for reasons of national security, terrorism, concern about an end-user and international obligations. It would also add flexibility in creation of the country tier system. The amendment removed a provision aimed at eliminating food and medicine exports from any sanctions imposed for foreign policy reasons. According to Senator Michael Enzi, sponsor of the bill, the administration asked for removal of the controversial provision to avoid conflicts as it works out a regulation on the same issue required as part of an agriculture spending measure passed in 2000. According to Banking Committee staff, in exchange for the proposed changes, the administration has agreed to resolve two longstanding controversial export-control issues. One issue, called "deemed exports," concerns restrictions on foreign workers who might gain information on sensitive technology that they could divulge to foreign colleagues. The other issue concerns disputes about jurisdiction over a number of items between the Commerce Department, which controls dual-use exports, and the State Department, which maintains much stricter controls on munitions exports. Another amendment adopted by the committee would repeal existing law basing control of computer exports on the number of million theoretical operations per second (MTOPs) a computer could execute. Gramm described that measure as obsolete given the increased capability for linking computers together. The bill would authorize the dual-use export-control system through September 2004 unless the president reports to Congress on its implementation and submits recommendations about improving it -- in that case authority would continue indefinitely. Voting alone against the bill was Senator Richard Shelby, one of about six Republican senators who blocked consideration of the bill in 2000 over national security concerns. Paul Freedenberg, government relations director at the Association for Manufacturing Technology, predicted after the vote that, with administration support, the Senate would likely pass the bill over opponents' objections. In the U.S. House of Representatives, which has not voted on these issues for years, Freedenberg said he expected crucial support from Representative Henry Hyde, the Republican chairman of the International Relations Committee. Hyde has expressed general support for Bush administration positions, said Freedenberg, who was under secretary of commerce in the Reagan administration. (The Washington File is a product of the Office of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
Source:
http://bennett.senate.gov/bush_administration_supports_b.html
FOR IMMEDIATE RELEASE
March 22, 2001
WASHINGTON, D.C. – "Failing to update our export control laws means failing to preserve our high-tech edge," said Utah Republican Senator Bob Bennett who today secured unanimous committee approval of legislation supported by the Bush Administration which will repeal outdated export control laws restricting the exports of high-performance computers.
Bennett, a high-tech leader in the Senate and member of the Senate Banking Committee, said "America's high-tech leadership in the world cannot be maintained if the industry that defined it is stifled. Clearly by repealing the MTOPS measurement, we lift a roadblock which otherwise impedes our progress."
S. 591, also sponsored by Sen. Harry Reid (D-NV), is supported by the Bush Administration and was unanimously approved today by the Senate Banking Committee as an amendment to its reauthorization of the Export Administration Act.
The Bennett-Reid bill repeals provisions of the 1998 National Defense Authorization Act which require the president to use MTOPS, or what Bennett calls an "outdated form of measurement", to set restrictions on the export of high-performance computers.
"Our current restrictions on computers are based on the theory that access to and use of computing power can be controlled. They cannot," Bennett added.
As a result of the Bennett bill, high-performance computers, along with other dual-use technologies, will be subject to the controls put in place by the reauthorization of the EAA.
In praising passage of the amendment, Bennett noted reports from the Department of Defense, General Accounting Office and Defense Science Board which have all concluded that the rigid MTOPS-based approach is obsolete and fails to advance U.S. national security.
Background on MTOPS
In the early 1990s, the United States and its allies developed a measurement of computer performance used only for export control purposes. MTOPS - millions of theoretical operations per second - measure a computer's highest theoretical power, if every function of the computer operated flawlessly.
A computer with a rating of 4000 MTOPS can theoretically perform four billion operations per second. It operates at 1500 MHz. Computer power, as measured in MTOPS, is dependent on three factors: chip speed (MHz), chip design (number of operations per cycle), and the number of chips in the computer system resources.
U.S. export control policies can be traced back to the Cold War era, when restrictions were developed to safeguard U.S. interests in the face of a global threat. To ensure the Soviet Bloc was kept from gaining access to strategic products that could enhance its military capability, Congress passed the Export Control Act of 1949 giving the president broad discretionary authority to establish unilateral export controls on U.S. products.
Since 1949, the Congress has enacted other export control laws and amendments to address changing political, national security and commercial conditions. In particular, the Export Administration Act of 1969, the Export Administration Act of 1979, and the Export Administration Reauthorization Act of 1985 all reflected an ongoing effort to balance commercial considerations with the protection of national security interests.
The Omnibus Trade Act of 1988 was the last time the Export Administration Act was significantly amended. In 1990 the Export Administration Act expired.
In time periods when the Export Administration Act was expired, all presidents have used emergency powers under the International Economic Powers Act to enforce the U.S. export control system.
In 1997, with no Export Administration Act in place, the Congress modified the export control regime amid concerns about possible use of "supercomputers" in proliferation-related activities abroad.
Through amendments to the National Defense Authorization Act (NDAA), Congress required exporters to notify the Commerce Department of exports to end-users in Tier III countries (50 countries including India, China, Russia and Israel) of computers between 2000 and 7000 MTOPS.
While the President has the authority to increase the MTOPS levels at which this notification takes place, and did so, any such increase was subject to a six month Congressional review process.
Last fall, an amendment by Sens. Bennett and Harry Reid (D-NV) changed the NDAA and reduced that review process to 60 days.
The Reauthorization of the Export Administration Act now proceeds to the full Senate.
[DOCID: f:s591is.txt]
107th CONGRESS
1st Session
S. 591
To repeal export controls on high performance computers.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 21, 2001
Mr. Bennett (for himself and Mr. Reid) introduced the following bill;
which was read twice and referred to the Committee on Banking, Housing,
and Urban Affairs
_______________________________________________________________________
A BILL
To repeal export controls on high performance computers.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. REPEAL OF CERTAIN EXPORT CONTROLS.
Subtitle B of title XII of division A of the National Defense
Authorization Act for Fiscal Year 1998 (50 U.S.C. App. 2404 note) is
repealed.
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