High-Tech Exports Over-Regulated, Think Tank Contends

A prominent conservative think tank plans to publish a report this month criticizing U.S. export controls and putting most of the blame for the narrowing of defense technology’s lead over the Soviet Union on lengthy Pentagon procurement policies.

Titled “Securing Technological Advantage: Balancing Export Controls and Innovation,” the paper from Georgetown University’s Center for Strategic and International Studies argues that the current list of militarily sensitive technologies is too broad and that “the present control system is overreaching in scope, inconsistent in application and over-reliant on unilateral restrictions.”

Primarily assembled by a panel of leading high-technology executives, the report further maintains that export controls have hurt U.S. companies abroad, exacerbated the trade deficit and had a chilling effect on high-technology innovation.

Export controls have proven to be one of the thornier policy issues faced by the Reagan Administration. Defense hard-liners, led by Richard Perle, undersecretary of defense for international security policy, have aggressively pushed for tough export rules to minimize the chance of strategically important high technology falling into Soviet hands.

Commerce Department officials and representatives of leading U.S. technology companies insist that much of the regulated technology has marginal military importance and that the restrictions hurt U.S. companies competing with Japanese and European companies.

The Georgetown center’s study, which has been circulating in both trade and defense circles, has drawn criticism from the Pentagon and cautious approval from a top Commerce Department official.

“It’s tough, but we think it’s wrong,” said Stephen Bryen, an assistant to Perle. “It was put together by businessmen, and we made it very clear that we thought it was unbalanced.”

Called Provocative

“It’s provocative,” said William Archey, the Commerce Department’s acting assistant secretary for trade administration. “It stresses the larger issues and points out that the cost of the controls has got to be looked at.”

A major thrust of the report is that the Commerce Department’s Commodity Control List, which enumerates about 150 categories that require specific export approval, and the Pentagon’s semi-classified Militarily Critical Technologies List are simply too large and complex to be effectively implemented.

“Those lists are so extensive that they are very unwieldy to use,” said David Shore, panel chairman of the Center for Strategic and International Studies and RCA’s staff vice president for the Strategic Defense Initiative. “There ought to be some (priorities).”

Indeed, the panel pointed out that the larger question isn’t purely export control but encompasses technological application in defense systems. The report will say that the U.S. moves proven technologies to the field too slowly because of Pentagon acquisition policies that have long lead times.

The panelists, many of whom are defense contractors, argued that “the U.S. habit of coupling new technology applications to the protracted acquisition cycle for major weapons systems discourages modernization of previously deployed equipment and allows it to become obsolete by the time it is replaced. Much of the difficulty experienced in preserving the U.S. technological edge is therefore of its own making.”

The report called for the creation of a blue-ribbon panel to devise a new way to measure strategically sensitive products, emphasizing “process technologies” that enable high-technology components to be built, rather than the technological end products themselves. This recommendation is reminiscent of the “Bucy Report” issued a decade ago. J. Fred Bucy, a former Texas Instruments executive, served on the Georgetown panel.

For U.S. trade with allies, the panel recommended elimination of export licenses in exchange for a system of self-policing.