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Hope Springs Eternal For Exporters
by William New
After years of heartbreak, government officials and technology industry representatives who are seeking an update to the nation's regime for controlling exports of sensitive technologies could have little capacity left for hope. Yet, a little like Boston Red Sox fans who rise each year to the possibility that this might be their year for success, forces are gathering to try to break a deadlock in Congress and change the 23-year-old export law.
Getting the expired 1979 Export Administration Act (EAA) renewed this fall is as bereft with political and practical difficulties as ever, and it is generally agreed that moving a bill will require great pressure from the White House. But changes in the makeup of key committees pending at the end of the year make it imperative for supporters to try to complete action this fall.
The White House has been publicly low-key on the matter, but sources privately say high-level administration and congressional meetings began this month, and the issue is purported to be a priority for President Bush this fall. "I am confident the White House and the leadership of the House and Senate are moving in the right direction," said Brian Kelly, senior vice president for governmental affairs at the Electronic Industries Alliance. "Timing is critical on this, and when the time is right they'll make an announcement."
The Bumpy Road To Compromise
To achieve a breakthrough, the various sides need to knit together a compromise from different bills to reform and renew the regime. The export-control system requires licenses for exports of high-performance computers and other products with potential civilian and military uses to countries deemed risky, such as China. The Bush administration has stated its full support for the EAA bill the Senate passed last year, S. 149.
But weaving a compromise historically has been difficult in cases where basic views on protecting the United States from rogue nations at the expense of economic opportunities are at issue, as they are in the current debate. The House Armed Services and International Relations committees approved competing export-control measures pitched as more security-oriented. Both versions of the House bill, H.R. 2581, would give the administration additional powers of control, charting a different course from the Senate legislation.
Resolving the differences is a delicate task for the administration for two primary reasons: Watering down the House proposals would require overriding strongly held views of key Republicans; and support for anything perceived as boosting national security has been substantial since last year's terrorist attacks on the United States.
Proponents of the Senate version argue that their bill would bolster security more than adequately, that the House would pass it, and that the result would be far better control of sensitive exports than currently provided under emergency measures enacted by presidential executive order. They said the Senate measure would significantly raise penalties for selling dual-use items to security threats.
But perhaps because they feel they hold the upper hand in the security debate, the House International Relations and Armed Services committees have not caved to White House pressure. Talks with White House staff to reach a compromise were brought to a stalemate last March, when the White House was told to craft a new proposal. Sources said this month that the administration likely has developed a compromise, but talks have not resumed.
"It's clear the White House is trying to renew interest in passing the EAA bill among the House Republican leadership," said Edmund Rice, president of the Coalition for Employment through Exports. "What's not clear is that any work is under way yet to prepare it for House floor consideration."
"It doesn't get serious until they come back to us with a serious offer," said a congressional source close to the International Relations Committee. "They need to sit down with us -- soon."
In Search Of A Strategy
Sources suggested that as many as 10 provisions still need to be addressed. The International Relations language appears to be less problematic than the Armed Services proposals; the latter would constrain the president's ability to decide how export licenses can be processed, and would dictate how the president should deal with countries that fail to report on the ultimate use of exported U.S.-made products.
Armed Services proposed several mandatory licensing requirements and a greater role for the Defense secretary in the licensing process, a seeming reduction in the president's licensing and policy flexibility not sought by the administration.
At this point, the White House appears to be working directly with House leaders. For months, sources have speculated that the White House and House leadership might use procedure to move the Senate bill to the floor, rather than try to resolve differences behind the scenes. But congressional and industry sources last week said they doubt that the White House would choose to bypass International Relations Committee Chairman Henry Hyde, R-Ill. "They're not going to use parliamentary procedure to mess this up," a congressional source said.
Likewise, there is skepticism that key Armed Services members like Duncan Hunter, R-Calif., would be ignored. Hunter is expected to assume chairmanship of the committee if Republicans retain control of the House after this fall's election.
Moving the bill to the floor presents another conundrum. One industry source said that moving the EAA bill as separate legislation would make it become "like a Christmas tree," with amendments all over it. But attaching it to must-pass legislation, such as an appropriations bill, also would be troublesome because most of those measures face unrelated obstacles. "This is just very perilous," the industry source said.
The New World Export Order
Adding indirectly to the bill's hurdles is the increased caution agencies have shown in approving licenses, especially for shipments to China, which is the high-tech industry's most popular new destination. "We just can't take for granted anymore that any destination is benign," said an administration official. "It has really changed the way of looking at the licensing system."
Several agencies are involved in the license-approval process, and there are four levels to the dispute-resolution process. At the first "working" level, called the operating committee, every agency is giving greater scrutiny to licenses, the official said.
The Administrative Committee for Export Policy of assistant secretaries, the deputies committee of undersecretaries and Cabinet officials also play a role in disputes over export licenses. Direct Cabinet-level involvement has been minimal since a 1995 executive order.
In the past, the aims of the Commerce Department often rubbed against those of the less commercially minded Defense and State departments. But under Bush appointee Kenneth Juster, a former State Department official, the orientation of Commerce has changed. The newly named Bureau of Industry and Security, formerly the Bureau of Export Administration, has taken a more cautious approach to approving licenses to ship sensitive technologies to risky nations, sources said.
"It's a 'not-let-it-out-the-door' mentality," said a congressional staffer. "It's a 180-degree different mentality [than in the Clinton administration]. It's like the 'Bureau of Non-Proliferation.'"
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