- The Washington Times - Tuesday, August 31, 2010

The Obama administration’s overhaul of regulations aimed at loosening controls on the export of some military technology is drawing fire from groups that monitor arms proliferation but praise from trade groups.

President Obama on Tuesday announced the export-control policies in a video during the Commerce Department’s annual conference on updates to export controls.

The policy seeks to streamline and standardize the licensing process for defense-related exports and create a new unified enforcement agency to crack down on violators of the export controls.

Currently, the Commerce and State departments administer controls on the licensing of munitions and sensitive dual-use exports, a long-standing source of concern for the U.S. defense industry that complains of delays and the byzantine nature of the bureaucracy. Dual-use items have both military and civilian applications.

“Going forward, we will have a single, tiered, positive list — one which will allow us to build higher walls around the export of our most sensitive items while allowing the export of less-critical ones under less-restrictive conditions,” Mr. Obama said Tuesday,

Gary Milhollin, director of the Wisconsin Project on Nuclear Arms Control, called the new policy a “defense industry bailout.”

“The financial industry and the auto industry had their bailouts, now it is the defense industry’s turn,” he said.

Mr. Milhollin also said the United States steadily relaxed arms-export controls since the end of the Cold War. “We have already reduced controls to the bone,” he said.

Mr. Milhollin said most defense technology being deregulated was developed with public money.

“The lion’s share of the technology we are decontrolling has been developed with taxpayer dollars,” Mr. Milhollin said. “This is taxpayer-owned technology that the companies now want to sell to the whole world.”

Henry Sokolski, the executive director of the Nonproliferation Education Policy Center, said, “the Obama administration is distorting what the primary purpose of the export-control regulations are, which is national security, not creating more jobs. What’s worse, nobody has demonstrated that loosening these controls will create more jobs.”

The reaction from industry representatives was different. Myron Brilliant, a senior vice president of the U.S. Chamber of Commerce for International Affairs, said, “by modernizing America’s antiquated export controls, the White House is seizing an opportunity to enhance U.S. national security and economic competitiveness at the same time.”

The emphasis on jobs was clear in Mr. Obama’s speech. He said, “by enhancing the competitiveness of our manufacturing and technology sectors, they’ll help us not just increase exports and create jobs, but strengthen our national security as well.”

The administration has made the case after a one-year policy review of export controls that the current system fails to adequately protect the most sensitive U.S. technology while over-regulating the export of harmless exports, such as break pads for M1A1 Abrams tanks.

William Lowell, a former director of the State Department’s Office of Defense Trade Controls between 1994 and 2002, said he suspected the streamlined export-control list would deregulate spare parts and components for many U.S. weapons systems.

“There is a comprehensive control system today on both the item and the spare parts and the components,” Mr. Lowell said. “It appears they intend to substantially decontrol the supply lines, or spare parts and components, for most weapons systems.”

Mr. Lowell added that the White House has yet to make public the complete export-control list. “It is not in the interest of sound policy to hide the implications of this policy from the public or Congress,” he said.

On Tuesday, the White House announced that it had started streamlining the export-control list for tanks and military vehicles. The review determined that about one-third of the exports on the 12,000 item list should be deregulated. There are 19 more broad categories of exports the White House agency will examine in the coming months.

“I understand that what they intend to decontrol has already been established on working lists and have made the rounds in government,” Mr. Sokolski said. “Apparently, they don’t want to release that information just yet. If they did, I bet there would be immediate outrage. You’ve got to hope that this is wrong.”

A White House official said those lists had not yet been created. “I wish we had this done. It is very labor intensive. It has taken time just to do the list for tanks and military vehicles,” the official said.

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