Balancing The National Interest -- Copyright -- Sponsors -- Preface -- Contents -- Executive Summary -- ABSTRACT -- INTRODUCTION -- THE TECHNOLOGY TRANSFER PROBLEM -- THE CURRENT NATIONAL SECURITY EXPORT CONTROL REGIME -- ASSESSMENT OF THE CRITICAL ISSUES -- FINDINGS AND KEY JUDGMENTS OF THE PANEL -- I. The Practical Basis for National Security Export Controls -- II. Considerations Influencing National Policy -- III. Soviet Technology Acquisition Efforts in the West -- IV. Diffusion and Transfer of technical Capability -- V. Foreign Availability and Foreign Control of Technology -- VI. Effectiveness of the Multilateral Process -- VII. Administration of U.S. National Security Export Control Policies and Procedures -- RECOMMENDATIONS OF THE PANEL -- I. Strengthen the Cocom Mechanism -- II. Accord Greater Importance in U.S. National Security Export Control Decisions to Maintaining Technological Strength... -- 1 Introduction -- THE NATURE OF THE PROBLEM -- The Technology-Security Nexus -- The Current Challenge -- ORIGINS AND MANDATE OF THE STUDY -- SCOPE OF THE PANEL'S WORK -- FOCUS OF THE STUDY -- ORGANIZATION OF THE REPORT -- NOTES -- 2 Evidence on the Technology Transfer Problem -- INTRODUCTION -- INTELLIGENCE EVIDENCE ON SOVIET TECHNOLOGY ACQUISITION -- ESPIONAGE -- DIVERSIONS -- LEGAL SALES -- THE SIGNIFICANCE OF VARIOUS CHANNELS OF LOSS -- SOVIET UTILIZATION OF ACQUIRED WESTERN TECHNOLOGY -- THE STATE OF SOVIET SCIENCE AND TECHNOLOGY 8 -- IMPLICATIONS OF INTELLIGENCE EVIDENCE -- NOTES -- 3 The Changing Global Economic and Technological Environment -- CHANGES IN THE INTERNATIONAL MARKETPLACE -- GROWING U.S. INTERACTION IN THE GLOBAL ECONOMY -- THE CHALLENGE TO U.S HIGH-TECHNOLOGY LEADERSHIP -- CoCom Countries -- Non-CoCom Countries -- NEWLY INDUSTRIALIZING COUNTRIES -- NOTES -- 4 The Dimensions of National Security Export Controls.

HISTORICAL BACKGROUND -- World War II Origins and the Early Postwar Years -- The Export Control Act of 1949 and the Establishment of CoCom -- The New Role of Science and Technology in Postwar U.S. Defense Strategy -- Detente and the Export Administration Act of 1969 -- U.S. NATIONAL SECURITY EXPORT CONTROLS -- Controls on Munitions -- Controls on Dual Use Products and Technologies -- Dual Use Products -- General Licenses -- Validated Licenses -- Controls on Technical Data -- Reexport Controls -- Penalties for Violations -- ADMINISTRATION OF U.S. CONTROLS -- MULTILATERAL NATIONAL SECURITY EXPORT CONTROLS -- THE CONTROL SYSTEMS OF OTHER WESTERN NATIONS -- NOTES -- 5 An Assessment of U.S. National Security Export Controls -- INTRODUCTION -- EFFECTIVENESS OF NATIONAL SECURITY EXPORT CONTROLS -- Intelligence and Enforcement Evidence -- Compliance -- Discrimination in Licensing and Enforcement -- Benefits of Controls -- THE EFFICIENCY OF EXPORT CONTROL ADMINISTRATION -- Processing Times -- Firm Size Differences -- COMPETITIVE EFFECTS OF CONTROLS -- Scope of Coverage -- Lack of Economic Analysis -- Sources and Extent of Disadvantage to U.S. Exporters -- The Case of Analytic Instruments -- The Case of Foreign Consignees Under Distribution Licenses -- TECHNICAL DATA CONTROLS -- USE OF THE MILITARILY CRITICAL TECHNOLOGIES LIST -- THE POLICY PROCESS AND THE BALANCING OF U.S. INTERESTS -- NOTES -- 6 An Assessment of the Multilateral Export Control System -- PROGRESS IN COCOM -- COCOM DEFICIENCIES -- Intra-CoCom Differences -- Scope of the International List -- The CoCom List Review Process -- The CoCom Exceptions Process -- Transparency of CoCom Decision Making -- U.S. POLICY AND INTERNATIONAL COOPERATION -- Foreign Policy Pressures on CoCom -- Extraterritorial Controls -- The Political Costs of U.S. Policy -- NEGOTIATIONS WITH NON-COCOM FREE WORLD COUNTRIES.

7 Findings and Key Judgments of the Panel -- THE PRACTICAL BASIS FOR NATIONAL SECURITY EXPORT CONTROLS -- CONSIDERATIONS INFLUENCING NATIONAL POLICY -- SOVIET TECHNOLOGY ACQUISITION EFFORTS IN THE WEST -- DIFFUSION AND TRANSFER OF TECHNICAL CAPABILITY -- FOREIGN AVAILABILITY AND FOREIGN CONTROL OF TECHNOLOGY -- EFFECTIVENESS OF THE MULTILATERAL PROCESS -- ADMINISTRATION OF U.S. NATIONAL SECURITY EXPORT CONTROL POLICIES AND PROCEDURES -- 8 Recommendations of the Panel -- PREAMBLE -- RECOMMENDATIONS -- I. Strengthen The Cocom Mechanism -- II. Accord Greater Importance in U.S. National Security Export Control Decisions to Maintaining U.S. ... -- CODA -- Appendixes -- A COSEPUP Charge to the Panel -- B Panel Foreign Fact-Finding Mission Reports -- European Mission -- Generic Policy Issues -- Underlying Assumptions -- Collateral Implications of Controls -- Scope of Controls -- Controls and Commercial Advantage -- National Security Versus Foreign Policy Controls -- Extraterritoriality -- Cocom Views/Policies -- Views on U.S. Policies and Procedures -- Diversions -- Goods in Transit -- Enforcement -- European Industry Views -- Non-Cocom-Country Issues -- "Running Faster" -- U.S. Export Control Regime Modifications -- Country Summaries -- The United Kingdom -- Belgium -- The North Atlantic Treaty Organization -- The Commission of the European Economic Community -- The European Parliament -- France -- The European Space Agency -- The Federal Republic of Germany -- Austria -- Sweden -- Anecdotal Comments of European Interlocutors -- United Kingdom -- Belgium -- France -- Austria -- Federal Republic of Germany -- Sweden -- Asian Mission -- General Issues -- Country Capabilities -- Role of Foreign Technology -- Perceptions of the Soviet Union -- Perceptions of the People's Republic of China -- Export Control Issues -- Foreign Availability/Domestic Capability.

Diversions -- Enforcement -- Attitudes Toward CoCom -- Views on U.S. Policies -- Export Licensing -- Investment -- Mixed Motives -- Technical Data -- Extraterritoriality -- Commercial Versus Military Technology -- Third Country Initiative -- Views and Practices of U.S. Businesses -- Country Summaries -- Japan -- Korea -- Hong Kong -- Singapore -- Malaysia -- Anecdotal Comments of Asian Interlocutors -- Japan -- Korea -- Hong Kong -- Singapore -- Malaysia -- C Operation and Effects of U.S. Export Licensing for National Security Purposes -- Introduction -- Volume and Structure of Affected Trade -- Operation of U.S. Controls -- U.S. Versus Foreign Control Systems -- Export Controls Vis-à-Vis Other Competitive Factors -- Data Sources and Limitations -- Commerce Department Data Bank -- Survey Questionnaires -- Interviews -- Coverage of National Security Export Controls -- Exports -- U.S. Affiliate Sales -- Destinations of Controlled Exports -- Product Composition of Affected Exports -- Composition by Industry Category -- Composition by Level of Military Sensitivity -- Firms Affected by Export Controls -- Administration of National Security Export Controls -- License Processing Times -- Overall Distribution -- By Destination -- By Level of Military Sensitivity -- By Firm Size -- License Actions -- License Denials -- License Applications Returned Without Action -- Reexports -- Effects of Controls on Business -- Administrative Costs -- Perceived Competitive Effects -- The Case of Analytic Instruments -- The Case of Foreign Consignees Under Distribution Licenses -- Conclusions -- Coverage of the Licensing System -- Administration of Controls -- Cost of Controls -- D Estimate of Direct Economic Costs Associated with U.S. National Security Controls -- Introduction -- Scope of U.S. Foreign Sales Covered by Validated Licensing.

Relationship of Benefits and Costs to Level of Criticality -- Estimate of Economic Costs Associated with U.S. Export Controls -- Annex -- A. Administrative Costs 0.5 Billion -- B-I. Revenue Loss for West-West Exports 5.9 Billion -- B-2. Associated GNP Loss 11.8 Billion -- C-1. Revenue Loss for West-East Exports 18 1.4 Billion -- C-2. Associated GNP Loss 2.8 Billion -- D-1. R&D Direct Spending Loss 0.5 Billion -- D-2. Associated GNP Loss 1.5 Billion -- E-1. Value of Licences Denied 0.5 Billion -- E-2. Associated GNP Loss 1.0 Billion -- F. Lost Profits on Lost Exports 0.5 Billion -- G. Annual Employment Loss 188,000 -- Notes -- E Glossary -- F List of Acronyms -- G List of Briefers, Contributors, and Liaison Representatives -- Briefers -- Contributors -- Liaison Representatives -- H BIBLIOGRAPHY -- WEST-EAST TECHNOLOGY TRANSFER -- Overview -- Aspects of the Soviet Economy and Military -- Soviet Acquisition Efforts -- The Soviet Ability to Absorb Western Technology -- Technology Transfer East to West -- CONTROLLING TECHNOLOGY TRANSFER -- Assessing the Need for National Security Export Controls -- What to Control -- Control of Unclassified Information -- Balancing Information Control With Open Communication -- U.S. TRADE ENVIRONMENT -- U.S. Trade Performance -- Balancing National Security and Economic Vitality -- THE U.S. EXPORT CONTROL SYSTEM -- Overview -- Legislation -- Effectiveness of Licensing and Enforcement Practices -- U.S. Extraterritorial Controls -- INTERNATIONAL CONTROL OF TECHNOLOGY -- Index.