The work of this panel has spanned a period of turbulent changes in the circumstances surrounding export controls. The study began in August 1989, when the transformations of Eastern Europe and the Soviet Union had just begun. The study was commissioned by a provision of the 1988 Omnibus Trade and Competitiveness Act and we were asked to examine all aspects of the U.S. national security export regime. The panel went beyond the scope of its predecessor, the Allen report, which concentrated "on national security export controls imposed on dual use technology." That report also "focused primarily on the Soviet Union and its Eastern bloc allies due to their central importance to the problem."

During the course of our study, we found that we could not address the most important issues of export controls today if we confined ourselves to that same scope. The reason is twofold. First, the different laws and regulations governing export controls now impinge strongly on one another. making it difficult to consider any one in isolation. Second, the structure of these laws and regulations was established in a world dramatically different from that of today. At that time, the principal targets of export controls were the Soviet Union, the countries of the Warsaw Treaty Organization, and the People's Republic of China. And the principal issue was to balance the military advantage to be gained from export controls against their damage to U.S. economic and industrial strength.

Today, both the nature of the threat and the balance of interests have changed while other threats of comparable if not greater importance have moved to center stage, i.e., the proliferation of weapons of mass destruction, as regional conflicts have taken on a more urgent cast.

Changes in the world today—not just in Eastern Europe and the Soviet Union, but also in Western Europe with the impending economic and political unification of 1992, and in Japan with its enormous economic power—are so dramatic and profound that they outstrip traditional thinking. Many of our policies are still rooted in the rubric of the 1970s and 1980s; the deep-seated views that have served us well for several decades are difficult to give up or change. But change they must if we are to respond to, and even lead in forming, the economic and political realities of the new world. And yet, in the midst of these changes, some of the old apprehensions remain: There continues to be an ominous array of weapons in the hands of forces that could once again become threatening. And new apprehensions grow: The spread of high-tech weapons, as well as the proliferation of nuclear, chemical and missile capabilities, change the calculus of national security.

One may ask if national security export controls haven't become moot. Can export controls still contribute significantly to our national security? We have answered this question, emphatically, "Yes"—not only in their continuing albeit dramatically altered role in East-West relations, but also in the realm of proliferation controls. The latter regimes, we conclude, must be brought fully under the rubric of national security. Export controls should neither be discarded in the glow of the moment nor retain the rigidity of the past.

As our panel has addressed these problems and tried to anticipate the future, we have constantly found that it was upon us. The changes have been so rapid that we have found it challenging to keep up with the present, let alone anticipate the future. Moreover, our conclusions and recommendations must fit into a future that will continue to change in directions that we cannot fully anticipate.

The report will be criticized by those who don't think we have gone far enough in abolishing export controls on East-West trade and, conversely, by those who think we have "caved in" to industrial interests. What we have attempted to do is to recommend not only policies and procedures appropriate for the circumstances at the time of writing but also processes that allow these policies and procedures to be changed to meet future circumstances. Thus, our goal has been to devise a system that can be responsive to the leadership of the President and Cabinet, a system more flexible and responsive than the present one has been and yet a system that is politically feasible both internationally and domestically.

Export controls have been a particularly troublesome corner of federal policy, as evidenced by the number of commissioned studies of them. The lineage of the present report traces back through the Allen and the Corson reports of the National Academies of Sciences and Engineering to the Bucy report of the Defense Science Board. The complexity of export control problems arises not only from the importance and intricacy of the competing

interests—national security and industrial competitiveness—but also from the large number of federal agencies with an important and legitimate interest in them. In the past, the administration of the export control laws and regulations has been complex and cumbersome, leading to slow decisions that unduly impaired U.S. international competitiveness. Recently, the Departments of State, Defense and Commerce, under strong presidential guidance, have made great strides in the speed and effectiveness of their administration. They are to be commanded for this. The changes that we recommend do not imply lack of significant progress toward improving the aim and effectiveness of export controls during the very recent past.

Nevertheless, we think that even greater strides are possible. Government should present as simple a face as possible to those being governed and regulated. In the case of laws and regulations as complex as export controls, it is especially important to do so. Even though large corporations have the resources and skill to deal with complexity in regulations, small firms and individuals do not. Today, many of our enterprises—for example, in the software industry—must become international at an early stage of their development. Because so much of the job creation and economic development of our nation depends on these small and mid-sized firms, we cannot burden them with excessively complex regulatory processes nor with policies that prejudice their ability to compete in world markets. Moreover, neither large nor small firms should have to bear the burden of jurisdictional overlap and the resulting controversies among executive agencies or congressional committees—or the fact that responsibilities have to be distributed to several different agencies or committees to assure the best expertise. We have tried to address these issues in a way that still preserves the legitimate interests and leading expertise of various federal agencies. We have attempted to keep control of policy where it belongs in the various agencies, while simplifying the routine administration of it. We see this simplified administrative process building on the positive steps already taken—and the potential revealed—by reforms recently initiated in the Department of State and the Department of Commerce.

An aspect of the emerging world that played heavily in our deliberations is the changing balance of importance between military and economic power and the changing position of the United States in this balance. Economies of other parts of the world are no longer as heavily tied to the fortunes of the U.S. economy as they once were. And yet for some of the tactics of the past to work, and even more so for others to work in the future, U.S. economic influence must be strong. With the emergence of Japan and Western Europe, and, increasingly, East Asia, as economic powers comparable to the United States, we will not have as much power to force others to follow our lead in imposing sanctions or controls as we have had in the past. We will have to seek much more concurrence with

others in order to exercise even the leadership that our present, still-considerable economic strength gives us.

We did not go as deeply into problems with the foreign availability process as requested. We made this decision for two reasons. First, the emergence of even more urgent issues that had not been anticipated in the original charge, required that our efforts and resources be focused in other directions. Second, we came to realize that ''foreign availability" was only a facet of the larger issue of "controllability."

Foreign availability is exceedingly difficult to ascertain in fact as well as in principle. With trading companies that are often no more than post office boxes, borders and ports that are open sieves, high-tech commodities that fit in pockets, software code that can be transmitted electronically, one would have to intercept and inspect a much higher fraction of world trade and communications than is feasible in order to determine the true extent of foreign availability.

Much technology that we might like to control has spread so widely, and is produced so extensively, that its control is no longer feasible. The reality of much of today's high-tech world—especially in computers and microelectronics, somewhat less so in other areas like aircraft and engines—is that once a technology is used substantially in nonmilitary equipment, it may become by nature virtually uncontrollable. It is easier to determine "controllability" than "foreign availability," requires less bureaucratic apparatus to do so, and entails fewer fruitless delays by understanding and using specific criteria for "controllability" than by having to examine detail after detail of foreign manufacture and distribution. And, likely, there will be fewer errors.

The main panel and three subpanels assembled to carry out this study consisted of people from highly diverse backgrounds, and that was one of their strengths. Some were scholars with deep knowledge either of fields of technology or of regions of the world: the USSR, Eastern Europe, and the Pacific Rim. Others were industrial people with intimate knowledge of how our system of export controls works and how it affects industry. Still others were people with military or diplomatic backgrounds relevant to the issues we studied. And the legal profession, too, was represented by individuals fully engaged with the systems we studied. Various members of our panel had served in the Departments of State, Defense, and Commerce, as well as the White House. Moreover, the outlook of various members of the panel was diverse. But, as the study proceeded, the varied sets of views, experience, and knowledge converged on the conclusions given in the report. The fact that this broad base of experience and outlook came to a unanimous report is, we think, significant in itself. We believe that the report is impressively free of ideological taint in any direction and that it represents the best efforts of a group that dedicated itself to a dispassionate examination of the issues.

As such, we hope it will be a singularly useful report to those in Congress and the Administration that have to deal with these complex issues.

The staff assembled by the National Research Council to support the panel was also outstanding in its knowledge and its dedication to the success of the study. Substantial drafting was performed by Mitchel Wallerstein (Chapters 1, 2, 4, 5, 7, and executive summary), Karin Berry (Chapters 6, 7, and 8), John Clement (Chapters 1, 2, and 3), Ed Moser (Chapters 6 and 9), and panel member Granger Morgan ( Chapter 10). The staff went through draft after draft after draft of the report in an unending quest to capture the essence of the panel's thinking and make it intelligible to the future reader. They truly have been patient and forbearing heroes in the entire process with substantive contributions of both word and thought throughout the report. We also wish to acknowledge the important contributions of Deborah MacGuffie, who kept both panel and staff well organized and who worked tirelessly to produce the multiple drafts noted above, and Jean Shirhall. who meticulously edited the drafts into proper English.

Finally, we should thank the participating government agencies for their assistance and cooperation, and especially the panel's liaison representatives. Many individuals and organizations—both U.S. and foreign—provided briefings and information to the panel and we are indebted to them all.