Murky waters
      Supporters and opponents have yet to encounter a real test of either view in the Senate.
      The only legislation to see any movement in the 105th Congress was a bill crafted by Senate Commerce Committee Chairman John McCain R-AZ and Sen. Bob Kerrey D-NE that was rejected by the high-tech industry and FBI officials as meeting the needs of neither side.
      The bill was approved by the Commerce Committee in June 1997 but quickly went nowhere. While providing limited relief from export controls, key provisions of the legislation aimed to promote the use of encryption products that include a "recovery feature" that would enable a third party, or a cop, to gain access to the "key" needed to unscramble encrypted data or communications.
      Industry officials have opposed any attempts, direct or indirect, to force them to produce only products with a key recovery feature built into them.
      Law enforcement officials said the legislation did not go far enough in meeting their need to ensure they can gain an unscrambled version of encrypted data or communications. They instead preferred a measure passed by the House Intelligence Committee to require that all products sold in the Unites States include a key recovery feature.
      Kerrey, in particular, appears to have shifted his position since he and McCain first introduced the legislation in 1997.
      In a recent interview with National Journal's Technology Daily, Kerrey, the vice chairman of the Senate Intelligence Committee, said he now believes that promoting the use of stronger encryption will provide greater security in the long run by protecting sensitive online transactions or electronic data from interception by criminals — even if it causes problems for law enforcement and national security officials in the short term. In addition, he said he no longer sees key recovery as a viable legislative option given the industry's opposition. "The marketplace is so against [key recovery]... they saw the legislation as counter productive," Kerrey said.
      Various sources say McCain also appears to have backed away from the bill he promoted in the 105th Congress. He is expected to introduce a new bill soon but has given little indication of what it will contain.
      Industry representatives and others, however, say any movement in the industry's direction on the part of Kerrey and McCain is significant, given that both are influential voices on national security issues.
      "We do have more reason to be optimistic," said Ed Gillespie, executive director of Americans for Computer Privacy, a group formed to push for eased export controls on encryption.
      Pointing to Kerrey in particular, Gillespie said "he's always been at the forefront of ardently opposing any changes" sought by industry and having him move closer to the industry's position "may be a harbinger" of what to expect from others.
      So far, many of the other key players have yet to focus on the issue. But industry officials and congressional advocates of loosening export regulations say that should not be interpreted as a signal that these senators are any less supportive of the cause. Sens. Patrick Leahy D-VT, Conrad Burns R-MT and John Ashcroft R-MO, all strong industry supporters, say they plan to reintroduce legislation but have not indicated whether they will join forces on one bill as they did in 1998.
      Nonetheless, legislation loosening export controls on encryption has the backing of top Senate GOP leaders including Senate Majority Leader Trent Lott R-MS.
      "I hope we can get it done," said Senate Majority Whip Don Nickles R-OK.

Potential obstacles
      But will the Senate, if it is finally forced to deal with this issue, put the brakes on encryption legislation as it does on so many other controversial bills?
      Despite his apparent shift in position, Kerrey has already indicated that he believes Goodlatte's bill goes too far, saying the legislation is a "blunt instrument" that does not acknowledge law enforcement and national security concerns. H.R. 850, which is opposed by the Clinton Administration, would allow for the export of any mass-market encryption hardware and software except to terrorist countries or specific end users that pose a military or terrorist threat.
      "Traditionally, the Senate is more moderate and less enthusiastic of the industry's side," said former National Security Agency General Counsel Stewart Baker, a lawyer who now specializes in technology issues.
      Even industry supporters, while generally more optimistic about their chances in the Senate, acknowledge lingering obstacles.
      The Senate is "definitely more conservative on this," said Becca Gould, vice president of public policy for the Business Software Alliance.
      For example, Kyl, who chairs the Senate Judiciary Committee's Technology, Terrorism and Government Information subcommittee, said he remains concerned about the potential impact on public safety and national security that easing export regulations may have.
      "Some people in industry want it both ways," he said. "They want the exports and not cooperate with law enforcement," a charge industry officials deny.
      At the same time, Kyl is concerned the administration may have given up too much leverage when it granted export relief in 1998 to a few selected sectors such as the health care and insurance industries.
      Feinstein, the ranking Democrat on Kyl's subcommittee, said she does not see the need for legislation. In particular, she said does not think Goodlatte's bill "will pass muster over here."
      As one key Senate committee aide said, on condition of anonymity, it is "more difficult to ram something through" in the Senate even if it is a priority for the leadership. At the same time, if the industry is merely using legislation as a way to force the administration to provide more relief, some senators may be reluctant to put the time needed into crafting an compromise bill, the aide said.
      In addition, few industry and supporters are discounting the commitment of law enforcement officials to wage a lobbying effort to derail legislation they believe will cause serious harm to their interests. As Goodlatte's encryption bill gained steam in 1997, FBI director Louis Freeh and others stepped up their opposition to the bill in closed-door briefings with lawmakers, forcing industry to play defense.
      "As much as the administration has the ability to slow things down, it doesn't want to be forced to do it," said Alan Davidson, staff counsel for the Center for Democracy and Technology, a group that promotes civil liberties in cyberspace.
—by Juliana Gruenwald