Gramm’s ‘Hi-Tech for China’ bill

By Frank J. Gaffney Jr.

As the Bush administration and Congress consider ways in which to
respond to the increasing belligerence of Communist China that was so much
in evidence in the EP-3E affair, one idea unlikely to top the list is the
idea of giving the People’s Liberation Army a massive new infusion of
militarily relevant U.S. high technology. Yet that would be just one of the
untoward effects of legislation Sen. Phil Gramm, the Texas Republican who
chairs the Senate Banking Committee, hopes get enacted in the next few
weeks.

Sen. Gramm is the chief sponsor of S.149, formally known as the
Export Administration Act. Its working title, however, should be the
“Hi-Tech for China” bill since Beijing will be one of the principal
beneficiaries of the emasculation S.149 proposes for what remains of U.S.
controls on the sale of sensitive equipment and know-how.

This bill is basically a reprise of legislation (S.1712) that Mr.
Gramm introduced in the last Congress. Fortunately, that version died
aborning — despite the Texan’s considerable clout, forceful personality and
intensive lobbying on the part of U.S. firms weary of government regulations
that interfere with their ability to sell whatever they want to whoever has
the necessary cash.

Their list includes such militarily useful equipment as: supercomputers, fiber optics, advanced telecommunications switching and routing gear, heat-resistant alloys and carbon-carbon materials, sophisticated machine tools and stealth technology.

Sen. Gramm was stymied last time around by a combination of factors.
The most important of these was that national security-minded legislators
strenuously opposed his effort to eliminate the vestiges of a real export
control regime that survived the Clinton-Gore administration’s wrecking
operation. Led by Sen. Fred Thompson, who chairs the Senate Governmental
Affairs Committee, senior members of the Foreign Relations, Armed Services
and Intelligence Committees were able to stymie the chairman of the Banking
Committee even though his panel enjoys tremendous institutional advantages
under Senate jurisdictional arrangements.

Having a committee dominated by export promoters write
export-control laws is about as ill-advised as having the Treasury
Department’s champions of foreign investment run the interagency process
charged with assessing the national security implications of overseas firms’
purchases of sensitive U.S. companies. The proverbial foxes guarding the
latter chicken coop see no harm, for example, in approving the pending sale
of Silicon Valley Group — the last U.S. manufacturer of high-end
lithography equipment critical to the mass production of state-of-the-art
electronic equipment.

To their credit, Sen. Thompson and the chairmen of the three
national security committees (Sens. Jesse Helms, John Warner and Richard
Shelby, respectively) — together with the chairman of the influential Senate
Republican Steering Committee, Sen. Jon Kyl — have sallied forth once again
to resist S.149. They argue persuasively that this bill “will reduce the
ability of the United States government to maintain effective export
controls on American-made products that can be used for civilian and
military uses (so-called dual-use products).”

They are alarmed — as should be all Americans — at the provisions
in the Gramm bill (whose other prime-mover is Sen. Mike Enzi, R-Wyo.) that would require the Secretary of Commerce to decontrol any item that is deemed to be available “in volume” in the country that produces it. As Gary Milhollin of the Wisconsin Project on Nuclear Arms Control recently noted in the Los Angeles Times: “[Electronic switches that can be used as]
nuclear weapon triggers, carbon fibers [that can make warhead nosecones more
lethal] and maraging steel [needed for nuclear weapon-related centrifuges]
are all available in volume in the United States, but that doesn’t mean they
are readily available to countries trying to build the bomb.”

The Commerce Secretary would also be obliged to decontrol any
technology that “controlled” countries could buy from “sources outside the
United States.” Taken to its logical conclusion, if the Russians (or our
allies) are willing to sell sensitive dual-use technology to China, then
U.S. companies should be able to compete for such deals. For that matter,
if German firms want to sell Libya or Iran chemical warfare-related
equipment (as they have done in the past), or the North Koreans are prepared
to provide ballistic missile technology to those or other rogue states (as
they are doing now), shouldn’t Americans be able to get a piece of the
action?

Presumably, President Bush’s response would be a resounding “No!”
Yet, the Gramm-Enzi bill would significantly interfere with his authority to
prevent such U.S. sales. To do so, he would have to intervene personally
and make a number of burdensome findings in order to overrule a
determination of mass market or foreign availability made by his Secretary
of Commerce. The latter would be triggered upon the petition of any
“interested party” (read, “interested” in making a dubious sale of
heretofore controlled equipment to a controlled end-user). Even then, the
President’s objection could only stand for eighteen months.

In the aftermath of the Chinese wake-up call near Hainan Island, it
would be the height of folly — not to say of ignominy — were the
Gramm-Enzi “Hi-Tech for China” bill to become law. This is particularly
true in light of the second thoughts being expressed by many in Congress who
had previously believed that nothing was more important than opening China’s
markets to American sales of non-dual-use goods and services.

Under these circumstances — to say nothing of the even worse ones
the People’s Liberation Army evidently has in mind for American interests
down the road — it is inconceivable that majorities on Capitol Hill and
President Bush will agree effectively to clear the way for the wholesale
distribution of militarily relevant U.S. products to Communist China and its
friends.