[Senate Hearing 105-850]
[From the U.S. Government Publishing Office]
S. Hrg. 105-850
BENEFITS OF COMMERCIAL SPACE LAUNCH FOR FOREIGN ICBM AND SATELLITE
PROGRAMS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON INTERNATIONAL SECURITY, PROLIFERATION, AND FEDERAL
SERVICES
of the
COMMITTEE ON
GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED FIFTH CONGRESS
SECOND SESSION
__________
MAY 21, 1998
__________
Printed for the use of the Committee on Governmental Affairs
U.S. GOVERNMENT PRINTING OFFICE
49-589 CC WASHINGTON : 1999
_______________________________________________________________________
For sale by the Superintendent of Documents, Congressional Sales Office
U.S. Government Printing Office, Washington, DC 20402
COMMITTEE ON GOVERNMENTAL AFFAIRS
FRED THOMPSON, Tennessee, Chairman
WILLIAM V. ROTH, Jr., Delaware JOHN GLENN, Ohio
TED STEVENS, Alaska CARL LEVIN, Michigan
SUSAN M. COLLINS, Maine JOSEPH I. LIEBERMAN, Connecticut
SAM BROWNBACK, Kansas DANIEL K. AKAKA, Hawaii
PETE V. DOMENICI, New Mexico RICHARD J. DURBIN, Illinois
THAD COCHRAN, Mississippi ROBERT G. TORRICELLI, New Jersey
DON NICKLES, Oklahoma MAX CLELAND, Georgia
ARLEN SPECTER, Pennsylvania
Hannah S. Sistare, Staff Director and Counsel
Leonard Weiss, Minority Staff Director
Lynn L. Baker, Chief Clerk
------
SUBCOMMITTEE ON INTERNATIONAL SECURITY, PROLIFERATION AND FEDERAL
SERVICES
THAD COCHRAN, Mississippi, Chairman
TED STEVENS, Alaska CARL LEVIN, Michigan
SUSAN M. COLLINS, Maine DANIEL K. AKAKA, Hawaii
PETE V. DOMENICI, New Mexico RICHARD J. DURBIN, Illinois
DON NICKLES, Oklahoma ROBERT G. TORRICELLI, New Jersey
ARLEN SPECTER, Pennsylvania MAX CLELAND, Georgia
Mitchel B. Kugler, Staff Director
Linda J. Gustitus, Minority Staff Director
Julie A. Sander, Chief Clerk
C O N T E N T S
------
Page
Opening statement:
Senator Cochran.............................................. 1
Senator Levin................................................ 2
Senator Thompson [ex officio]................................ 4
Senator Collins.............................................. 7
WITNESSES
Thursday, May 21, 1998
William Graham, President, National Security Research, Inc.,
former Deputy Administrator, NASA, Science Advisor to
Presidents Reagan and Bush..................................... 8
John Pike, Director, Space Policy Project, Federation of American
Scientists..................................................... 12
William Schneider, Jr., Adjunct Fellow, Hudson Institute......... 15
Alphabetical List of Witnesses
Graham, William:
Testimony.................................................... 8
Prepared statement........................................... 43
Pike, John:
Testimony.................................................... 12
Prepared statement........................................... 48
Schneider, William Jr.:
Testimony.................................................... 15
Prepared statement........................................... 55
APPENDIX
Chart entitled ``Waivers for Exports of Satellites Launched By
China,'' prepared by the Subcommittee staff.................... 59
Chart entitled ``Applicability of Space Launch Vehicle Technology
to Ballistic Missiles,'' provided by the Central Intelligence
Agency......................................................... 60
Article submitted by Senator Levin from the Washington Post,
dated September 10, 1988, entitled ``Reagan Backs Plan to
Launch Satellites From China Rockets''......................... 61
Letter dated September 20, 1996, sent to Chairman of the Senate
Foreign Relations Committee from the Department of State,
signed by Barbara Larkin, who was Assistant Secretary for
Legislative Affairs............................................ 63
Letter dated October 8, 1997, sent to Commerce Department from
Hughes Space and Communications Company, signed by the manager
for export compliance.......................................... 65
BENEFITS OF COMMERCIAL SPACE LAUNCH FOR FOREIGN ICBM AND SATELLITE
PROGRAMS
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THURSDAY, MAY 21, 1998
U.S. Senate,
Subcommittee on International Security,
Proliferation, and Federal Services,
of the Committee on Governmental Affairs,
Washington, DC.
The Subcommittee met, pursuant to notice, at 10 a.m. in
room SD-342, Senate Dirksen Building, Hon. Thad Cochran,
Chairman of the Subcommittee, presiding.
Present: Senators Cochran, Collins, Levin, and Thompson [ex
officio].
OPENING STATEMENT OF SENATOR COCHRAN
Senator Cochran. The Subcommittee will please come to
order.
I would like to welcome everyone to today's hearing of the
Governmental Affairs Subcommittee on International Security,
Proliferation, and Federal Services.
This morning we will examine the question of how a foreign
country's satellite and intercontinental ballistic missile
programs could benefit from launching commercial satellites
that are built in the United States, and whether the
administration's export control policy for satellites is
adequate to prevent technology transfers that could endanger
our country.
We will hear from witnesses who will explain the evolution
of our commercial satellite export policies and discuss
specifically whether military benefits are derived by China
when it launches U.S.-built satellites.
In 1996, President Clinton ordered export-licensing
jurisdiction for all commercial satellites on the U.S.
Munitions List moved from the State Department to the
Department of Commerce. This policy change was accompanied by
an announcement that the Commerce Department would conduct
``enhanced'' reviews of satellite export license requests in
order to safeguard American technology and national security;
that export licensing decisions for commercial satellites would
still be based primarily on the national security implications
of the transfer; and that an individual validated license would
continue to be required throughout the export process.
The end of the Cold War, of course, did not signal the end
of threats to America's security. In numerous hearings last
year, this Subcommittee took testimony from experts who
provided many facts on one of the most substantial post-Cold
War threats to the United States, the proliferation of weapons
of mass destruction and missile delivery systems. And while
Russia and China were identified as the world's major
proliferators, we learned last year that the United States
itself is implicated in proliferation through increasingly lax
controls on the export of so-called ``dual-use products,'' such
as supercomputers, that have both civilian and military uses.
This morning we will explore the effect on American
national security of the relaxation of U.S. export controls on
missile and satellite technology. Although there is a lot of
interest in the reasons for the administration's commercial
satellite export policy changes, and particularly in the
questions that have been raised about the license issued to
Loral Space and Communications, those issues will be examined
later, after a thorough review of the facts.
A senior official of one of America's major aerospace firms
recently told my staff that, ``whenever you connect a launch
vehicle to a satellite, there has to be some technology
transferred.'' The question is whether the United States faces
enhanced national security risks as a result of this kind of
technology transfer, and if so, what should be done about it.
The witnesses who will testify this morning are: Dr.
William Graham, former Deputy Administrator of NASA and Science
Advisor to Presidents Reagan and Bush, and currently President
of National Security Research, Incorporated; John Pike,
Director of the Space Policy Project at the Federation of
American Scientists; and Dr. William Schneider, Under Secretary
of State for Security Assistance, Science, and Technology from
1982 through 1986, and now a fellow at the Hudson Institute.
It is the intention of the Chair to ask each witness to
make a statement. We have written statements which have been
supplied to the Subcommittee which will be printed in the
record, and then we will have an opportunity, after all the
statements have been made, to question the witnesses.
Senator Levin.
OPENING STATEMENT OF SENATOR LEVIN
Senator Levin. Thank you, Mr. Chairman.
The question that we're asking today is whether using other
countries' rockets to launch U.S. commercial satellites could
jeopardize our national security. Specifically, the focus will
no doubt be on whether the United States should permit U.S.-
built civilian satellites to be sent to China or other
similarly situated countries for launching.
Apparently our country does not have enough capacity to
accommodate the needs of our own commercial companies, and
launches in the United States are considerably more expensive
than launches in China. These factors drove U.S. businesses to
seek approval for their satellites to be launched in China,
starting in the late 1980's, when President Reagan first
approved the use of Chinese rockets in China to launch U.S.-
made commercial satellites.
In order to send a sensitive item like a satellite to a
foreign country like China, the owner must obtain an export
license. As of March 1996, the owner is required to submit an
application to the Commerce Department which convenes an
interagency process to review it. The Department of Defense,
Department of State, Energy Department, and Arms Control and
Disarmament Agency all participate in reviewing the license
application.
For countries other than China, that's the end of the
process. The Commerce Department can either approve or reject
the application. Prior to March 1996 and depending upon the
type of satellite or satellite equipment, the licensing agency
was the Department of State, which maintains the so-called
``munitions list,'' which included many commercial satellites
and satellite equipment. The Department of State limits
licensing considerations to those of national security and
foreign policy, without consideration of economic or trade
concerns.
When the licensing authority was transferred to the
Commerce Department, consideration of national security and
foreign policy concerns continued, but consideration of U.S.
economic interests was added.
Relative to China, however, the licensing process doesn't
reach a conclusion until the President agrees to a waiver,
unless, of course, there is a decision not to proceed. Since
the 1989 Tiananmen Square incident, the law prohibits any
commercial satellite shipment to China unless the President, on
a case-by-case basis, determines that the shipment would be in
the national interest. This waiver, like the export license,
involves an interagency process in determining whether a waiver
would be appropriate.
The State Department is a major player in this decision. If
the agencies agree, they send a recommendation to the National
Security Council which then conducts its own review and makes a
recommendation to the President. No license to ship a satellite
to China may be issued by the Commerce Department--nor could it
have been issued by the State Department when it had the
jurisdiction--without that Presidential waiver.
So in the case of China, the licensing process is really
determined by the requirement of a Presidential waiver, since
no license can be issued without it and obviously once a waiver
is granted, the license would follow.
Recent news stories have focused on the procedures that our
government follows in granting licenses to send satellites to
China, namely the issue of which Department should be in charge
of approving the licensing and whether the grant of waivers by
President Clinton has been appropriate. But in looking at the
last 9 years in which American-made satellites have been sent
to China for launching, we can see that both the choice of
which Department will be doing the licensing and the identity
of the President granting the waivers has been immaterial to
the outcome.
As you can see from the list which has been prepared by my
Subcommittee staff,\1\ using data provided by the Congressional
Research Service, of the 20 waivers granted for satellites sent
to China for launching in the last 9 years, 9 were approved by
President Bush over 3 years, and 11 were approved by President
Clinton over 4\1/2\ years. And, in all but the last 3 waivers--
so in 17 of the 20 waivers--the licensing agency was the State
Department, which is the licensing agency if the exported item
is on the munitions list.
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\1\ The chart entitled ``Waivers for Exports of Satellites Launched
By China,'' provided by the Subcommittee staff, appears in the Appendix
on page 59.
---------------------------------------------------------------------------
These facts strongly suggest that it has made no difference
relative to China whether satellites were on the munitions list
and therefore licensed by the State Department, or whether the
satellites are not on the munitions list and therefore licensed
by the Commerce Department. Either way, the use of Chinese
launch rockets require a Presidential waiver, and it made no
difference whether the President was named Bush or Clinton.
Those waivers have been approved.
In answering the question of whether we should simply
eliminate the opportunity for a waiver and bar the shipment of
civilian satellites or their parts to China, period, we need to
look at the risks involved in continuing the current practice
initiated by President Reagan. First, does the act of using
China's rockets to launch U.S. satellites involve the transfer
of technology that will enhance China's ability to launch
missiles? At least one witness today thinks there is such a
possibility.
Second, there is the possibility that the failure of a
launch--the explosion of a rocket--will allow pieces of U.S.-
made satellites to fall into the hands of the Chinese. I would
like to explore that question and the question of other
possible risks with today's witnesses, as I know each of us
will.
Mr. Chairman, the United States is a technological giant in
the world of commerce. This hearing raises important questions
about how we carry out that role. I am glad we are holding this
hearing, and I thank you for bringing us together.
Senator Cochran. Thank you, Senator Levin.
Senator Thompson.
OPENING STATEMENT OF SENATOR THOMPSON
Senator Thompson. Thank you very much, Mr. Chairman.
I appreciate the fact that you are holding these hearings
to examine our process of export approval of commercial
communications satellites, and whether or not we are risking
the transfer of technology that might assist the Chinese with
their ICBM missiles.
I think that we will have to conclude at the outset that no
one--no one here, anyway--can possibly know whether or not
technology has been transferred in any particular instance that
might compromise our interests. I think it's clear that with
regard to the way these things work, the extensive
communications between our commercial vendors here and the
Chinese concerning the operations of the missiles, no one knows
exactly what conversations take place or what information might
be passed on.
We do know that it's very much in the interest of our
commercial enterprises for these missiles carrying their
satellites to work. It's very much in the commercial interest
of our domestic companies to have the Chinese, for example,
carry these satellites. It's the difference between hundreds of
millions of dollars per launch and somewhere between $25
million and $85 million.
So going in, we know that our commercial interests--while
totally patriotic--have a commercial interest in not only
having the Chinese do this, and others, but that they work and
that they not explode, as happens on occasion. And if there are
problems with regard to the missiles carrying these satellites,
I am sure there is a tendency to want to transfer enough
information--to the Chinese, in this instance--to make sure
those missiles don't explode again, that they don't shake so
much that they damage sensitive technology, and that they have
the capability of getting the job done.
We can't know about all of what transpires. We can guess;
we can think in terms of probabilities, or we can think in
terms of possibilities. We can think in terms of the risks that
are there, and we certainly need to think in terms of
safeguards and what kind of process and procedure we need to
have in place to minimize those risks.
Of course, the underlying problem is that these commercial
communications satellites contain militarily-sensitive
characteristics cross-link capabilities where satellites talk
to one another without having to go through the ground,
integration technology that could improve ballistic missile
capabilities to make sure that the missiles are stable.
Many think the intangible know-how that might be derived
from learning more and more about how to make their missiles
operable and accurate is more important to the Chinese than the
actual hardware. Satellite dispensing technology--the same
technology that allows multiple satellites to be launched on
one launcher--is the same kind of technology that is needed for
multiple warhead missiles.
There is no question that the standards have been relaxed
with regard to the transfer of this technology and export
licensing. The State and Commerce Departments simply approach
things differently, as they are supposed to do. The Commerce
Department has more than one interest; the Commerce Department
has the commercial interest in addition to the national
security interest.
I'm not sure how much we can determine by the fact that
there have been sanctions waivers in various administrations
and that some licenses are granted by the State Department and
some by the Commerce Department. I'm not sure without examining
each one, how much we can determine about that, or what the
result might have been had decisions been with another agency.
But we do know that the shift that this administration made in
1996 of the responsibility in this area from the State
Department to the Commerce Department was contrary to the
determinations that had previously been made by interagency
groups, both in the Bush and the Clinton Administrations.
I think it's important to point out that in the Bush
Administration, the interagency group established criteria with
regard to militarily-sensitive characteristics pertaining to
these satellites and they determined that satellites that did
not contain these militarily-sensitive characteristics could be
transferred to the jurisdiction of the Commerce Department.
About two dozen items were so transferred, and about half of
the satellites which had no such characterizations. That was
following the recommendation of a 2-year study by this
interagency group.
What happened in 1996 was that the interagency group at
that time determined that that situation should stay the way it
was; that is, if these satellites did not contain militarily-
sensitive information, it was OK for them to be under the
Commerce Department jurisdiction, but if they did, they should
remain at the State Department.
Secretary of State Christopher agreed with that. However,
the President overruled his own interagency group and the
Secretary of State--his own Secretary of State at the time--and
transferred licensing authority to the Commerce Department. So
the difference between administrations is, first, in the nature
of the technology or the nature of the satellites that were
being transferred, and second, the fact that one President
followed the recommendations of his interagency group while
another President overruled it. It was overruled when Secretary
of Commerce Ron Brown appealed the decision of Secretary of
State Warren Christopher to President Clinton. And that's the
way that that came about.
The GAO looked at all of this, and they say that the
implications of transferring to the Commerce Department
authority over satellites with militarily-sensitive
characteristics are uncertain.
I not think that we can consider this matter without the
underlying consideration of who we're dealing with. We know the
Chinese have sent missiles to Pakistan; they've sent technology
to Iran; they've sent nuclear equipment to both; they've
conducted missile tests off the coast of Taiwan; and
apparently, according to reports, the CIA has determined that
13 of their 18 long-range ballistic missiles have nuclear
warheads aimed at American cities. They have been caught in
violation of their solemn agreements with regard to these
matters. They are apparently aggressively trying to improve
their missile program as a part of a military buildup.
This is what we're dealing with here. So I appreciate the
fact that you're having this hearing, Mr. Chairman. I look
forward to exploring this, and saving other matters for other
times. Later we will have a chance to look into several of what
have been called ``coincidences,'' such as the fact that the
Chinese arms dealer, Wang Jun, visited Mr. Brown at the
Commerce Department and attended a White House coffee on the
very day that President Clinton approved the launch of four
satellites by the Chinese on February 6, 1996. Of course, Wang
Jun had millions of dollars at stake in a Hong Kong satellite
company.
Another coincidence that we will inquire into later is the
fact that between November 1995 and June 1996, the Loral folks
contributed $275,000 to the Clinton reelection.
The last coincidence we will look into later on is one
concerning Ms. Liu. Apparently after the President announced
this shift to the Commerce Department, she facilitate the
transfer of a little under $100,000 to the Democratic National
Committee. Ms. Liu, of course, is reported to be a Lieutenant
Colonel in the Chinese military; her father was the highest-
ranking member in the military and in the leadership of the
Communist Party.
Incidentally, the parent company of Ms. Liu's company tests
and provides equipment for the Chinese nuclear arsenal, and the
Great Wall Industries Company. That company also launches
private satellites; and that company, incidentally, is the one
that was sanctioned by this country back in 1993 for
transferring satellites to Pakistan.
So those are all matters that we will save for another
time. But I look forward to that also. Thank you very much.
Senator Cochran. Thank you, Senator Thompson.
Senator Collins.
OPENING STATEMENT OF SENATOR COLLINS
Senator Collins. Thank you very much, Mr. Chairman.
I want to start by commending you, Mr. Chairman, for your
long leadership in the area of technology transfer. I know this
is an issue that has been of great concern to you for many
years, and you've been a real leader in Congress in this area.
Certainly, recent events have conspired to give the subject
of our hearing this morning even more relevance than usual. On
February 15, 1996, a so-called Long March booster rocket lifted
off its launch pad in the People's Republic of China, only to
explode spectacularly some moments later. Because this
explosion destroyed a $200 million satellite owned by Loral
Space and Communications, and Hughes Electronics, February 15
was a grim day for these American companies.
This launch failure, however, was perhaps not entirely
unwelcome from the perspective of United States national
security interests. It has recently been reported that at least
13 of China's 18 intercontinental ballistic missiles are
targeted on American cities. Significantly, if ever launched,
the nuclear warheads on these missiles would be carried to
their American targets by rocket boosters similar to the Long
March system that exploded on that day in February 1996.
Significantly, the faults that the two American companies
subsequently found in the exploding Long March booster were
reportedly symptomatic of more general engineering or design
flaws in Chinese rockets. If the Long March blew up upon
launching, in other words, we could hope that if Chinese
missiles were ever released against Washington, Chicago, New
York, Denver, Dallas, or San Francisco, they, too, might well
blow up.
Ordinarily, one might think that a previously undiscovered
defect in Chinese ballistic missiles would be good news for all
Americans. Loral and Hughes, however--and with them it appears,
the White House itself--did not think so. The details of how
these companies and the administration cooperated to facilitate
improvements in Chinese missile reliability now seems likely to
be the subject of considerable investigation by Congress.
The reports of this missile episode, however, highlight the
importance of the export control matters that we are
considering today. They suggest that there are some very real
problems in the way that U.S. policy attempts simultaneously to
promote American business interests and to protect American
national security.
Security policy making in a democracy often requires
enormously difficult trade-offs. Among these many balancing
acts is the tension between free trade and export controls. No
matter what the economic benefits from free trade, however,
arming potential adversaries with weapons they cannot otherwise
obtain is surely foolhardy.
It is on the strength of this insight that we have built
our system of national security export controls. Today they
revolve around such things as ICBM launch control systems,
supercomputers, and multiple warhead delivery systems.
With regard to ICBMs, we should make no mistake. The
technologies used in military and civilian space launch systems
have always been inextricably intertwined. The space programs
and the ICBM programs of both the United States and the Soviet
Union, for example, shared a common origin in Hitler's V-2
rocket program. The V-2 mastermind, Werner von Braun, in fact,
went on to help us build our earliest ICBMs and to develop our
civilian satellite program.
Space launch technologies have, therefore, always been
dual-use technologies.
Now, I do not mean to suggest that we can never insulate
civilian technology transfers from military ones. My point
simply is that it takes great care and diligence to do this
correctly. It requires constant attention from real security
professionals. And it requires that the White House not
interfere with the decisions of those professionals.
There is considerable reason to believe that our government
has failed to follow these requirements.
I look forward to hearing the expert witnesses that we have
before us today. And again, I commend the Chairman for his
longstanding leadership in this area.
Senator Cochran. Thank you very much, Senator.
If we now can move to the statements of our witnesses,
we'll call on Dr. Graham first, then Mr. Pike and Dr. Schneider
will follow in that order.
Dr. Graham, welcome.
TESTIMONY OF WILLIAM GRAHAM,\1\ PRESIDENT, NATIONAL SECURITY
RESEARCH, INC., FORMER DEPUTY ADMINISTRATOR, NASA, SCIENCE
ADVISOR TO PRESIDENTS REAGAN AND BUSH
Mr. Graham. Thank you, Mr. Chairman, and Senators.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Graham appears in the Appendix on
page 43.
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I'd like to briefly address the benefits of commercial
space launch assistance and use for foreign intercontinental
ballistic missile programs this morning.
The design, engineering, testing and operation of ballistic
missiles and space launch vehicles, sometimes called SLVs, have
a great deal in common. This is particularly true for
intercontinental ballistic missiles. The maximum velocities of
ICBMs can be slightly less than that of SLVs, but from an
orbital mechanics point of view, ICBM's can be considered space
launch vehicles whose orbits intersect the Earth at the target.
There's a misperception in some circles that ICBMs are more
sophisticated and complex than space launch vehicles. In
reality, the opposite is true. The preponderance of SLVs are
ICBMs with additional elements. Put another way, if you have a
space launch vehicle, you also can have an ICBM by removing
those additional elements--the satellite in particular--and
adding a re-entry vehicle containing a nuclear or other type of
warhead.
Most of the current U.S. unmanned space launch vehicles are
derived from ICBM systems and are closely related to them. This
is true for foreign countries as well.
In the case of China, the Long March-3 was derived from DF-
5 ballistic missile technology, and India's Agni Medium Range
Ballistic Missile is based on the design of its first space
launch vehicle, the SLV-3, which in turn is a copy of a U.S.
space launch vehicle.
Space launch vehicles produced in non-market economies have
been offered to the United States and other satellite
manufacturers at attractive prices for launching high altitude
geosynchronous communications satellites, which support the
demand for long distance telephony, data transmission, pagers,
radio feeds, and television feeds, as we've seen this week with
the Galaxy IV satellite failure. And in the coming years, lower
altitude satellites will provide infrastructure for commercial
remote sensing, cell phones, and pagers.
Because these commercial satellites are expensive and time-
consuming to build, and are instrumental in generating profits
for the communications industry, American satellite
manufacturers have strong incentives to enlist in ensuring that
foreign SLVs transport their satellites to the intended orbits
reliably and deploy the satellites in good working order. This
assistance, however, can equally aid in the development and the
reliability of foreign ICBMs.
Essential elements of a space launch vehicle are its
propulsion, structure, staging, guidance and control, ground
support and launch equipment and procedures, overall systems
integration, pay-load, the satellite or re-entry vehicle with
warhead, the payload deployment, and the development testing,
engineering, and facilities of the space launch vehicle.
These essential elements of an ICBM are the same, with the
exception of the payload, which for an ICBM, as I mentioned, is
a re-entry vehicle containing some type of warhead rather than
a satellite. I will briefly discuss each of these elements.
Propulsion. There are basically two types of propulsion
systems used in rockets: liquid fuel propulsion systems and
solid fuel propulsion systems. The liquid fuel systems are all
derivatives and extensions of the V-2 technology developed
during World War II. That applies all the way from the V-2
itself to the space shuttle main engines that are used today.
These liquid propulsion systems are very efficient. At the
same time, they require some care in handling and preparation
for launching. The propellants themselves are very, very
energetic chemicals and have to be managed and handled by
experts.
Solid propellants, on the other hand, are much more inert
materials until they're ignited. And they are much more
appropriate for a ballistic missile force that has to stay on a
high state of alert for long times--years--and still launch on
very short notice--minutes. This is an advanced ballistic
missile force, and in fact similar to the technology the United
States and, by and large, Russia uses today.
Both of these technologies can be used for space launch
vehicles, and both have been used for space launch vehicles. In
general, developing countries tend to prefer the greater
efficiency of the liquid systems for their first space launch
vehicles.
The structure of ICBMs and space launch vehicles must both
be very light, since they're being accelerated against the
force of gravity to velocities in the range of 24,000 feet per
second--about 10 times the speed of a typical rifle bullet--but
still must be very strong.
The acceleration of launch produces several Gs of load on
the structure during the ascent phase, and the aerodynamic
loads are large during portions of the trajectory when the
vehicle is high in the atmosphere.
The structural requirements place a premium on materials
design and fabrication for both ICBM and SLVs. These structures
are very highly integrated in order to save weight. That
integration goes through the payload itself, either the warhead
for an ICBM or the satellite for an SLV.
Staging is a common procedure designed to throw away part
of the mass of the space launch vehicle, or the ICBM, before it
reaches orbit or its target. You've heard of one, two, and
three stage rocket systems, in which stages are sequentially
discarded after the fuel has been expended.
Stage separation, which is commanded by the vehicle's
control system immediately after the propulsion of the stage is
terminated, is used to minimize the amount of structure carried
along after it is no longer needed. Staging is a very delicate
process that has to be done quite precisely so that it doesn't
disorient or otherwise damage the stages remaining to go to
orbit, or for that matter, disrupt the satellite or the
warhead.
Guidance and control subsystems of both space launch
vehicles and ICBMs keep track of where the vehicle is and where
it's supposed to go. Where it's supposed to go is a combination
of velocity and location in orbit for a space launch vehicle,
or a point on the surface of the Earth for an ICBM.
The guidance and control system calculates the direction
and duration of the rocket thrust that must be commanded for
the rocket to reach the target, and then controls the direction
of thrust, so that it satisfies that calculation. This process
occurs several times each second during powered flight.
In the past, the location of the vehicle during ascent was
determined by inertial measuring units, comprised of gyroscopes
and accelerometers. But the opportunity exists today to use
U.S. global positioning satellite systems and the Russian
GLONAST system to establish the rocket's location with high
accuracy by reference to precision satellite beacons.
While high precision inertial measuring units are expensive
and difficult to produce, GPS and GLONAST--assisted navigation
units are potentially more accurate and less expensive, and the
basic elements are widely available today.
ICBMs designed to destroy targets specifically hardened to
nuclear attack require more accurate guidance than space launch
vehicles. However, for attacking all other targets, including
cities, space launch vehicle guidance systems have sufficient
accuracy for ICBM use as well.
Ground support and launch equipment and procedures are also
an important part of both ICBMs and space launch vehicles. In
fact, they're the same for the propulsion and guidance elements
of both of these types of systems. From a personnel standpoint,
space launch vehicle crews are automatically capable of being
ICBM launch crews.
The ground support for preparation, monitoring and checkout
of the specific payloads for space launch vehicles and ICBMs is
different, since the payloads are different. Satellite payloads
for SLVs tend to be more complex and require more advanced
ground support than do ICBM warheads.
A very important area that's sometimes overlooked is the
overall system integration, which in general is a field in
which the United States has world leadership. Even after the
individual components and subsystems of a space launch vehicle
or ICBM are functioning properly, they must still be integrated
into a complete system that can work together.
Instabilities in propulsion, control, or other subsystems
often depend on the coupling of two or more subsystems in
unanticipated ways. Incipient instabilities can lead to a rough
ride to orbit, placing additional mechanical stresses on the
payload. An extreme manifestation of these instabilities can,
and unfortunately has, caused the breakup and destruction of
the entire vehicle in powered flight.
The integration of the propulsion, guidance, control,
structure and aerodynamics is the same for space launch
vehicles and ICBMs, while the integration of the payload is
unique to the specific design. However, the analytical tools,
such as the structural dynamics analysis software, are the same
for both and are used widely.
The integration of the payload, like other aspects of
system integration, require an intimate knowledge of both the
payload and the launch vehicle. In the case of a space launch
vehicle, a great deal of detailed technical information must be
exchanged between the satellite designers, the satellite
attachment and aerodynamic shroud designers, and the vehicle
designers, to integrate the payload into the system.
And there must be a close working relationship between the
space launch vehicle engineers and satellite engineers and
technicians to assure a successful launch mission.
Mr. Chairman, integrating a satellite with an SLV is not
like putting a load in the back of a pickup truck. This is a
very highly integrated system.
The more that can be done to improve the ride to orbit by
reducing the mechanical stresses on the satellite, and the more
that can be done throughout the SLV system to increase its
overall reliability, the more likely that a successful launch
and orbital insertion will be achieved. Measures taken to
increase the performance and reliability of space launch
vehicles translate directly into performance and reliability
improvements in ICBMs.
United States and Russian ICBM development programs have
used more test flights than have their space launch vehicle
counterparts. This is a result of United States and Russian
efforts to achieve both high reliability and high accuracy--
goals that may not be as important to other countries.
Payloads for space launch vehicles and ICBMs are different.
That has been noted in the opening statements, and is certainly
worth repeating.
On the other hand, the integration problems, as I
mentioned, are the same. And all the ascent problems are very
similar.
Payload deployment is another area of common technology.
The release of a single satellite payload and a single warhead
payload are similar operations. Both require the proper
deployment, positioning, and orientation of the payload. The
deployment of multiple satellites from a space launch vehicle
and multiple warheads from an ICBM are also similar operations.
The Iridium program, for example, which has used Chinese
space launch vehicles, among others, deploys several satellites
during one launch mission, and requires a deployment platform
to do that. This, of course, is very, similar to the technology
for multiple re-entry vehicles such as we have on our Minuteman
III system, and for that matter, on Peacekeeper. Information
and experience gained from one of these payload deployment
activities can be applied directly to the other.
Development, testing, engineering and facilities is another
area of common technology. The requirements for space launch
vehicle and for ICBM vehicle development are very similar.
These include engine test stands and testing, guidance and
navigation test laboratories and facilities, test flight
ranges, and vehicle diagnostics and telemetry systems.
Perhaps the most critical technology that can be
transferred is the engineering skill and experience required
for interpreting and rectifying design problems that occur
during system development and are reflected in the telemetry of
system performance during testing.
In addition to advancing the ICBM capabilities of other
countries, U.S. assistance in supporting and developing space
launch vehicle capabilities assists these countries in being
able to use space more effectively for military purposes. These
purposes include reconnaissance, communications, and
meteorology, and others.
Such capabilities can then be provided in turn to other
countries in exchange for military, political, or financial
support. Transferring space launch technology to the developing
world provides space access to many potential adversaries of
the United States, and is a serious matter that carries
substantial risk to the United States and its allies around the
world.
Thank you, Mr. Chairman.
Senator Cochran. Thank you very much, Dr. Graham, for your
statement.
Mr. Pike, we will now hear from you.
TESTIMONY OF JOHN PIKE,\1\ DIRECTOR, SPACE POLICY PROJECT,
FEDERATION OF AMERICAN SCIENTISTS
Mr. Pike. Mr. Chairman, Members of the Subcommittee, I
appreciate the opportunity to testify before you this morning,
a morning in which the world is a more dangerous place than it
was a month ago or a year ago. And a morning on which I think
it's going to be a more dangerous place a month and a year from
now.
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\1\ The prepared statement of Mr. Pike appears in the Appendix on
page 48.
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We're witnessing the birth pangs of an arms race on the
Indian subcontinent, rumors of war in Kashmir, ratification of
the comprehensive test ban in the United States, or the START -
2 agreement in Russia seem less likely than even a few weeks
ago.
This Subcommittee in particular has been instrumental in
alerting the Nation to these and other dangers, many of which
transcend the traditional Cold War litany. Fortunately,
however, the subject of today's hearing does not rank very high
on this list. And I welcome this opportunity to inject some
much-needed balance to the increasingly controversial questions
of the relationship between missile and space launch
technology, and the adequacy of existing export control
mechanisms to maintain this distinction.
You may recall that Werner von Braun ``aimed for the Moon
and hit London.'' Since the dawn of the space age and the
missile era, the primary distinction between space launch
vehicles and missiles has been attitude, and only secondarily,
altitude. The first American and Soviet satellites were
launched on converted military missiles and derivatives of
these missiles continue to be used by both countries.
It remains trivially true that many of the major technical
arts applicable to the challenges of missilery are equally
applicable to space launch operation. A more challenging
question is to unravel the actual military significance of
specific technologies.
Concerns have been raised as to whether the interactions
with American commercial satellite operators have led to the
transfer of technical information that would be useful to the
Chinese in improving the liability or capability of their
missiles. Given the ongoing investigations of these matters,
and the consequent limited public availability of detailed
technical information, it's difficult to form a definitive view
on this matter, and several general observations are possible
and necessary at this juncture.
For nearly three decades, the Chinese have maintained a
small arsenal of ICBMs capable of targeting American cities. It
is the fact of the existence of this force, rather than the
fine grained details of their technical characteristics, that
has defined their existential deterrent posture relative to the
United States.
The space launch industry is extremely sensitive to
questions of launcher reliability, with launchers exhibiting
reliability lower than the prevailing 90 to 95 percent
liability rates, facing potentially prohibitive insurance
premiums. Unlike space launch vehicles, the difference between
75 percent and 90 percent reliability of the Chinese missile
force would have no material bearing on the quality of the
existential deterrents in terms of American or Chinese
calculation.
High confidence and high reliability of missiles has been
an abiding concern of the United States. But we face a very
different operational requirement of achieving target kill
against a large number of Russian ICBM silos.
I am concerned that in the absence of rampant and
significant reductions in American and Russian nuclear
arsenals, China may, over the coming decades, build up to
current American force levels if we choose not to build down to
theirs, and develop an appetite for high confidence and
reliability.
Hopefully we can forestall this development, but should we
fail, we will not confront the Chinese arsenal of liquid fueled
DF-5s, such as they have today, but rather a more numerous
arsenal of their new solid fuel DF-31 and DF-41 missiles.
And any insight, however marginal, into the reliability of
the DF-5 gained in the 1990's would surely be of vanishing or
little relevance to the reliability of the utterly unrelated
DR-31s and DF-41s deployed decades hence.
While accuracy is also of interest in the missile and
launch fields, divergent considerations apply. Satellite
operators generally set standards for launch vehicles, placing
their satellites into some proximity of the destination orbit.
But the margin for error in the real world is normally many
miles. And since satellites always carry their own maneuvering
propellant it's left to the satellite rather than the launcher
to reach the ultimate destination. And in the case of deploying
multiple satellites, this deployment can take place over a
period of hours or days, rather than the minutes found in the
case of a multiple warhead missile.
The warheads carried on missiles have no such supplementary
guidance or propulsion capability, and rely entirely on the
missile and the quality of the re-entry vehicle body to reach
their terrestrial destination. The accuracy of existing Chinese
missiles is not well characterized in -the open literature, but
is surely denominated in miles rather than the hundreds of
yards characteristic of American missiles. Such accuracy is
consistent with the deterrent role of the existing Chinese
missile force.
Close does count in horseshoes, hand grenades and global
thermonuclear war. It matters little to China or America
precisely which part of Los Angeles is the actual ground zero.
It should be recalled that the atomic bomb dropped on Nagasaki
actually missed by a wide margin, a fact lost on the citizens
of that unfortunate city.
Again, over time, this may change, and we may a few decades
hence confront the Chinese nuclear arsenal that is both as
numerous and as accurate as that deployed by the United States
today. While this would represent a profound policy failure on
the part of the United States to the extent that it was within
our control, the potential transfer of technical data related
to current Chinese launch vehicles would not materially
contribute to this failure.
And given the ongoing investigation of allegations, it's
also difficult at this point and in this forum to provide a
definitive answer to the adequacy of current export control
regulations. But the course taken over this decade with respect
to the Chinese launch vehicles has had diverse benefits and on
balance, manageable risks.
This set of policies has strengthened the American
satellite industry, enhancing our global dominance of this
strategic sector, and in the process, increasing the diversity
and capability of communications available to our military
forces worldwide.
It's engaged the energies of the Chinese aerospace industry
and perhaps moved them towards seeing space development rather
than missiles as a central focus of their emerging role in the
world. It's given us leverage in discouraging their transfer of
special weapons technologies to other countries, notably
Pakistan. While these efforts have clearly not been as
successful as we would have wished, armed proliferation sticks
would have been even less effective in the absence of the
carrots of space proliferation.
We should not allow current controversies to obscure the
fundamental soundness of this approach. But even more
critically, we should not allow the current controversy to
distract us from the more pressing and significant challenges
American security faces today.
Senator Cochran. Thank you, Mr. Pike.
Dr. Schneider, we will hear from you now.
TESTIMONY OF WILLIAM SCHNEIDER, JR.,\1\ ADJUNCT FELLOW, HUDSON
INSTITUTE
Mr. Schneider. Thank you very much, Mr. Chairman, and I
appreciate the privilege of testifying before this
Subcommittee, and also appreciate your leadership on this
particularly important subject.
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\1\ The prepared statement of Mr. Schneider appears in the Appendix
on page 55.
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I'll just summarize a few remarks concerning the regulatory
aspects of this problem. The U.S. Government has historically
regulated communications satellites, even when they were having
strictly commercial applications, because of the close
association of space launch and space satellites with national
defense purposes.
Over time, the enabling technologies for the civil and
military applications began to converge, and there were
relatively few differences between them for either civil or
military applications for communications satellites.
The primary differences between the commercial
communications satellites and military communications
satellites focused on measures to assure the survivability of
those satellites. Those measures were generally developed
through the Department of Defense, and hence justified the
regulation of the communications satellites, even for
commercial purposes, under munitions list auspices.
Due to the growth in space and launch services reliability,
as Dr. Graham and Mr. Pike referred, especially in Russia and
China, it created the possibility of establishing a worldwide
commercial launch industry. This coincided with the U.S.
Government's policy change seeking to de-nationalize the space
launch industry and convert it into a commercial industry.
However, for national security as well as commercial
considerations, the U.S. Government chose in the 1980's to
limit the use of Russian and Chinese space launch services.
This was done through continuing munitions list licensing of
communications satellites and a system of launch quotas because
of the fact that China and Russia at the time were non-market
countries.
A policy change undertaken referred to in 1996 is an
important philosophical change, and I think it should be noted,
because of the difference between the concept of munitions
license regulation and commercial or Department of Commerce
regulation. The philosophy under munitions licensing is that
the matter to be exported is approved to achieve the national
security purposes of the United States. Nothing is permitted to
be exported that addresses those purposes, unless specifically
authorized.
As a consequence, when a communications satellite or space
launch services or anything else that is identified on the
munitions list is proposed for export, the technology is very
thoroughly disaggregated to the point where perhaps two dozen
offices in the national security community, the Department of
Defense, Department of State, intelligence community and other
agencies depending on the details of the technology, will
review it very carefully, based upon very detailed
documentation required to be submitted by the applicant.
This differs from the philosophy of products that are
licensed under the Department of Commerce licensing, which is
mainly done to promote the economic interests of the United
States. And the aim is to facilitate the passage of this
technology or services or hardware into international commerce
for the benefit of U.S. industry.
Typically, the technology associated with it is focused
primarily on the functionality of the system, that is, what
purpose would it be used for, rather than the disaggregated
review of the technology, as is the case in munitions
licensing. These philosophical differences are important,
because to the degree to which technology is transferred under
a commodity jurisdiction change, from the munitions list to the
Department of Commerce list, the technology is more likely to
go into the public domain and indeed, to be done in a way that
is generally not subject to U.S. monitoring.
I think the trends in this can be underscored by the degree
to which liberalization has taken place. When I served in the
Department of State in the mid-1980's, the Department of
Commerce issued nearly 150,000 validated export licenses for
dual-use equipment. In fiscal year 1997, that figure dropped to
about 11,000, underscoring the dramatic degree to which the
advanced technology has been liberalized.
Indeed, the most common items licensed on the Department of
Commerce list are shotguns. So the degree of liberalization is
indeed very substantial.
If added to that, there is a Commodity Jurisdiction change,
based on the philosophical differences between the two
licensing systems, it reflects a change in underlying public
policy. The circumstances that we face with communications
satellites is that it is at the nexus of the problem of
balancing between these commercial aspirations of the United
States which are extremely important, as our society and
economy are information-driven, and our national security
concerns.
I appreciate the work of this Subcommittee in trying to
understand the issue and achieve appropriate balance in them.
Thank you Mr. Chairman.
Senator Cochran. Thank you, Dr. Schneider, for your
assistance to the Subcommittee and for your statement.
Dr. Graham, you have pointed out how there are a lot of
similarities between space launch activities and
intercontinental ballistic missile activities in terms of the
testing, building, and launching of these types of vehicles.
We happen to have a chart here that was prepared for the
Subcommittee by the Central Intelligence Agency, although it is
unclassified. It's available there, and it compares different
parts of the missile system with a space launch vehicle.\1\
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\1\ The chart provided by the Central Intelligence Agency appears
in the Appendix on page 60.
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Does this in your view, based on your experience and
knowledge of these systems, describe in a helpful way or an
accurate way how interchangeable so many of the parts of these
systems are?
Mr. Graham. Yes, Mr. Chairman, I think this is a good
representation of it. I would only add that for third world
countries that are developing longer range rockets, they can
also take the strap-on boosters you see on the space launch
vehicle and apply them to the ballistic missile as well. So
there is in fact a little more commonality than that chart
shows.
But it's basically correct.
Senator Cochran. In 1993, on the question of whether the
State Department would continue to license technical data
sharing for the commercial satellites already moved to the
Commerce Department's licensing jurisdiction, a Defense
Department memorandum to the Department of State said, ``While
all of the USML,'' meaning U.S. Munitions List, ``controlled
technical data is of concern, that technical data which covers
launch vehicle integration services is of the utmost importance
to DOD and the missile tech community. Because any technical
data on the launch vehicle, other than electrical and
mechanical integration data, directly relates to ballistic
missile proliferation concerns.''
Do you think the Department of Defense memorandum in 1993
is still a valid expression of concern?
Mr. Graham. Yes, Mr. Chairman. If anything, I think it was
a understatement of the concern. It excludes the mechanical
integration information, but in fact, the mechanical
integration of the payload with the booster is very important.
For example, both ballistic missiles and space launch
vehicles tend to bend while they're flying upwards, sort of
like this. The control system has to be able to take that out
by dynamic control.
The weight of the satellite or the payload on top is also
moving back and forth. You can't let that body, in an
oscillation called a body mode, either damage the satellite or
its mount, or somehow have that mass at the top of the missile
adversely affect the dynamical response of the rest of the
vehicle.
So I think if anything, the concerns are a little more
extensive than they are voiced there. But they're basically
correct.
Senator Cochran. In the next year, January 1994, there was
a Washington Times article which reported that licenses had
been approved for the launch of two Martin Marietta satellites,
Echo Star and AsiaSat II in China. The Commerce Department
export licenses reportedly permitted Martin Marietta to assist
the Chinese with integration analysis of the satellites to the
space launch vehicle.
According to the article, ``A Martin Marietta spokesman
confirmed that his company's sale would include an integration
analysis package,'' my question to you is, what is this
integration analysis that is being discussed there, and how
could it be helpful to Chinese missile programs?
Mr. Graham. The integration analysis is the analysis of the
overall performance of the space launch vehicle with the
satellite on board. It's a very important part of space launch
activities, because if in fact the missile or the booster is
not well suited to the satellite launch, if it provides a rough
ride or high acceleration to the satellite, one of two things
will happen. Either you will have to put more structure in the
satellite, which means you have less useful payload, or you
will experience a failure in the satellite, either from the
mechanical stresses on it or on the attachment it has to the
space launch vehicle.
Similarly, if the satellite isn't the right mass and
balance, it can affect adversely the rocket launcher itself. So
there is not a way to separate the integration of the satellite
with the integration of the space booster. They have to be done
as one single unit. And you have to understand the performance
of that whole system to have a successful launch to orbit.
There's technically not a divide between what the booster
design people need to know and what the satellite people need
to know. They both need to know almost everything about the
mechanical and electrical characteristics of the system.
Senator Cochran. Your statement is in essence a conclusion
based on your experience and knowledge of these systems that by
allowing China to launch U.S. commercial satellites, we're
actually helping improve China's missile and satellite launch
capabilities and their infrastructure.
Does this also relate to providing a higher state of
readiness for those involved in China in these programs? We
hear a lot about China being unable to immediately respond in
cases of emergencies. Does launching U.S. satellites also help
keep China's launch time in a higher state of readiness than it
otherwise would be?
Mr. Graham. It certainly provides strong economic support
to the cadres of rocket scientists and engineers that China
has. We essentially pay for part of their training and their
infrastructure. That gives China an overall more capable
ballistic missile as well as satellite launch capability.
It also keeps those cadres active in preparing and
launching rockets. That, again, helps their readiness to launch
whatever China dictates that they launch.
Finally, in the longer run, the next step in guidance
systems, for example, is going to be to global positioning
satellite assisted guidance, both for space launch vehicles and
for ICBMs. And that will make both of these much more accurate
in their performance and improve their ICBMs' ability to hit
targets.
Senator Cochran. Dr. Schneider, in your discussion of the
regulatory regime and its evolution and the changes that have
taken place over the last several years, you mentioned the
impact of the change of philosophy as well as regulation that
occurred in 1996. I have a copy of a letter that was written to
the Chairman of the Senate Foreign Relations Committee from the
Department of State, signed by Barbara Larkin, who was
Assistant Secretary for Legislative Affairs.
It's dated September 20, 1996. And it's notifying the U.S.
Senate, specifically the Chairman of the Foreign Relations
Committee, of these changes that had taken place under the
Export Administration Act. I'm going to give you a copy of
this, so you can have it available to you.\1\
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\1\ The letter, dated September 20, 1996, appears in the Appendix
on page 63.
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One thing that is mentioned in this letter is that, not
only is there a removal from State Department to the Commerce
Department, from the munitions list to the so-called Commerce
Department control list, of militarily sensitive components of
commercial satellites. But it noted that additional controls
would be placed on these items by the Commerce Department to
bolster its export control regime.
The letter says this: ``These satellites would not be
eligible for a Commerce Department general license.''
My question is, what is meant by the term ``general
license''? Is this some kind of jargon for saying a formal
export license from the government is not necessary to export
the item? And how is this different from an individual
validated license?
Mr. Schneider. Thank you, Mr. Chairman.
A general destination license is essentially equivalent to
not requiring an export license. The technology that is so
identified, or the product that's so identified, can be
exported by the exporter without need for additional authority
from the U.S. Government.
The individual validated license, which is, that is the
category I mentioned that has been a beneficiary of substantial
liberalization from about 150,000 now down to about 11,000 in
fiscal year 1997. Individual validated license means that the
applicant has to provide information on what he wishes to
export and who the end user is, and other bits of information
relating to it.
That is assessed by the Department of Commerce and in some
cases referred to other agencies. If the agencies agree, then
the Department of Commerce will issue a license of the intended
purpose. And that is an individual validated license.
Senator Cochran. Thank you. For the purpose of our record,
I'm going to ask that a copy of the letter dated September 20,
1996, be included in the record.
Senator Cochran. Senator Levin.
Senator Levin. Thank you, Mr. Chairman.
First I'd like to go back to 1988, when President Reagan
decided to allow for the transfer of satellites for Chinese
launch. It was apparently a highly controversial decision,
opposed by many members of Congress. This is what a Washington
Post article says on September 10, 1988, which I would ask be
made part of the record, Mr. Chairman.\2\
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\2\ The Washington Post article referred to appears in the Appendix
on page 61.
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It said that, ``President Reagan, in a move designed to
expand trade between the United States and China, has given
conditional approval to plans to launch three American-made
communications satellites on China's Long March rocket
boosters, the State Department announced yesterday. If the
decision is not blocked by Congress, or by a special Western
Bloc commission that monitors technology transfers to communist
nations, it will mark the first time U.S. satellites have been
launched from a non-western or communist country.''
``The administration's approval of export licenses,'' and
I'm shortening this, that's why I want the whole article in the
record, ``the administration's approval of export licenses for
the satellites was condemned by several members of Congress as
threatening national security by giving the Chinese an
opportunity to see American satellite technology.''
``China's promised it will not examine the satellites,
which will be shipped for launch in sealed containers. But some
U.S. officials have said there is no way to ensure the security
of the satellites once they're in China awaiting launch.''
So apparently this decision, it says here by the way,
``this is a victory,'' says the Washington Post, ``for the
Chinese government.''
Apparently it was a highly controversial decision at the
time, because of some of the concerns, Dr. Graham, which I
heard from you this morning, the very launch of an American
satellite from a Chinese rocket contributes to the advance of
rocket science in China. Is that fair?
Mr. Graham. Yes, Senator, that's fair.
Senator Levin. Since that time, since Tiananmen Square,
there's been a requirement for a Presidential waiver for a
transfer of a satellite for Chinese launch. Those waivers have
been forthcoming under both President Bush and President
Clinton.
There must be a national security review, as I understand
it, before those waivers, so that the waiver in effect
supersedes the licensing requirement. Because the agency,
whether it's the State Department or the Commerce Department,
is going to license something where there's been a Presidential
waiver. Once it's gone through that waiver process, I doubt
there's very much left for the agency to decide.
The waiver process kind of supersedes the licensing
process. If a President waives a transfer, it's kind of hard to
imagine the Commerce Department or the State Department is not
going to issue the license following that.
Do you know, Dr. Schneider, whether or not the number of
agencies involved in that presidential review are fewer than
they are for a munitions list review, when there's a State
Department licensing? Do you know if the number of agencies is
fewer?
Mr. Schneider. I'm not intimately acquainted with the
process that's being used. But my expectation would be that the
same agencies at the cabinet level would be involved. The issue
that is not known to me is the degree to which the technology
is in fact disaggregated and sent to the special offices that
have the particular knowledge of the technology. That might
make a difference in how the review would come out.
Senator Levin. So you're not sure whether or not, inside
each agency, it goes to the same sub-agency groups for review,
but it might.
Mr. Schneider. It might, yes. I hope it would.
Senator Levin. Now, yesterday, the House passed an
amendment which reverses this policy and says, no more
satellites can be transferred to China-basically reverses the
decision--there's also a couple of other amendments, too, which
change the munitions list issue.
But the fundamental amendment adopted yesterday by the
House said, no more satellites can go to China for launch,
regardless of what President Reagan's done, what President Bush
has done, what President Clinton has done, in terms of
permitting this with waivers or with scrutiny. The fundamental
issue here seems to me is the one that Dr. Graham has raised,
and you others have commented on: Should the satellites be
permitted to go to China for launch?
By a vote yesterday of 417 to 4, following I believe a 10-
minute debate on the amendment but a much longer debate on the
whole issue, the House of Representatives said that there will
be a prohibition, here it is: ``No satellite of the United
States in origin, including commercial satellites and satellite
components, may be exported or re-exported to the People's
Republic of China.''
Do you agree with that decision, Dr. Graham?
Mr. Graham. Senator Levin. I would like to preface my
response with a brief word of background. I first worked on
ballistic missiles in 1964, when I was an officer in the Air
Force. I have worked on several ballistic missiles since then,
and also helped, when I was at NASA, resurrect the U.S.
unmanned space launch vehicle program. So I have considerable
familiarity with both ballistic missiles and space launch
vehicles.
I was the director of the Office of Science and Technology
Policy, as well as science advisor to the President, when the
issue of the use of Chinese SLVs came forward in 1988. Based on
my experience, at that time I opposed sending those first three
satellites to China for launch. I still think that was an
unsound policy, and therefore think the measures the House has
taken yesterday are in fact correct.
Senator Levin. In 1988, you opposed President Reagan's
action?
Mr. Graham. No, Senator, there was an interagency review of
the prospect of allowing those satellites to be transferred to
China for launch. During that interagency review process, I
opposed their being transferred.
Senator Levin. That's what I mean. During that process, it
was your opinion that those satellites should not have been
transferred, we should not have started down that road?
Mr. Graham. That's correct, Senator.
Senator Levin. That's still your opinion?
Mr. Graham. Yes, Senator.
Senator Levin. Mr. Pike, yesterday's vote, do you think it
is wise or unwise? It's the fundamental issue.
Mr. Pike. I think it was certainly very poorly premised,
and that's one of the reasons I'm hoping that this hearing
today is going to be able to put this matter in a slightly
better perspective. If one examines the statements that have
been made on the Floor of the House, Floor of the Senate over
the last several weeks regrading the situation with respect to
the Chinese strategic forces, it seems to me that the House was
making a decision that was at best extremely poorly informed.
We've heard charges that there are now hundreds of Chinese
nuclear missiles aimed at the United States, although I think
we've had probably a more realistic assessment of that here
this morning. The suggestion that there were no Chinese
missiles capable of reaching the United States until last year
and that this change and all kinds of other horrific changes
have been solely due to the events that I take it are going to
be subject to further investigation here and elsewhere, I think
is obviously and fundamentally at variance with the facts.
So if the House is basing its decision with respect to
launching Chinese satellites, American satellites on Chinese
rockets, under the notion that this policy has somehow resulted
in some profound, immediate, obvious, irrefutable degradation
in American security due to the ability of the Chinese to fire
hundreds of nuclear missiles at the United States today,
whereas they were utterly incapable of doing so a year ago, I
think that it's astonishing that the House could be making a
decision on the basis of such erroneous information.
Senator Levin. I take it, then, you don't agree with the
House's decision?
Mr. Pike. I think it was very poorly premised, and I'm
hopeful that the Senate will be able to set matters straight,
hopefully on the basis of the record we're making in this
hearing today.
Senator Levin. Dr. Schneider, was the House doing the right
thing yesterday in prohibiting the transfer or export of
satellites or components to China?
Mr. Schneider. I know any President wishes to have
discretion in the ability to manage foreign policy.
Restrictions imposed by the Congress are often resisted for
that reason. But because of the risks of proliferation, I think
it was the right choice.
Senator Levin. Simply, no more commercial satellites for
launch in China?
Mr. Schneider. Unless we can come up with a technique that
isolates China's access to the technology transfer that we've
been discussing here.
Senator Levin. Doesn't the very launch of those satellites
contribute somewhat to their knowledge, for the reasons that
Dr. Graham went into and you went into somewhat?
Mr. Schneider. Yes. Hypothetically, the only way I can
imagine doing it is if they export the satellites to an
offshore user acceptable to the United States, where all the
launch integration services would be performed by people
outside of China.
Senator Levin. My understanding of the waiver provision
following Tiananmen Square, which has been used by President
Bush and by President Clinton, is that Congress has an
opportunity to overturn the waivers. We're on that chart that I
put up, those 20 waivers. Is that your understanding? Does
anyone know if that is correct?
Excuse me, the license, technically, which follows the
waiver. Do you know if that's technically correct, anybody,
that Congress has, I think, 30 days after the license is issued
following the waiver to China, to overturn that license?
Mr. Schneider. That's not my understanding. That process,
to the best of my knowledge, applies only to exports under the
Arms Export Control Act where there's a Congressional----
Senator Levin. All right, but 17 of those 20 were munitions
list items.
Mr. Schneider. Munitions List items, yes.
Senator Levin. So in those 17 cases, when the State
Department had the licensing responsibility following the
waiver, in those cases Congress had 30 days to object. Is that
correct?
Mr. Schneider. Yes, under the Section 36 notification
process, that's correct.
Senator Levin. All right. Now, do you know whether in any
of those 20 cases, where those launches occurred in China, that
Congress even attempted to file an objection? Does anybody know
that?
Mr. Schneider. It's not known to me, Senator.
Senator Levin. Do you know? Anybody know?
Mr. Pime. There has certainly been, at least early in the
process, a fair amount of specifying. But I don't think there
was any concerted effort.
Senator Levin. So as far as you know, Congress has never
exercised the power it has to stop a satellite from going to
China in order to be launched in China, is that correct? Never
attempted to exercise that power?
Mr. Schneider. Yes, that's correct, Senator.
Senator Levin. Is there also a power that Congress has when
something is removed from the munitions list to object, do you
know?
Mr. Schneider. I don't recall, sir.
Senator Levin. I think the letter that was read earlier is
a notice to Congress under Section 38(f) that the President
report to the Congress at least 30 days before any item is
removed from the U.S. Munitions List. So there is a notice
requirement, is that correct?
Mr. Schneider. Notification, right.
Senator Levin. And as far as you know, did Congress, when
it received notice of the shift of these items from the
munitions list to the Commerce Department list, was there an
effort to override that shift? Do any of you know?
Mr. Schneider. I don't believe there is a statutory process
where they have a resolution of disapproval, as in the case of
AECA transfers.
Senator Levin. But a bill could be introduced?
Mr. Schneider. Yes, of course.
Senator Levin. Do you know whether or not a bill was
introduced?
Mr. Schneider. Not me, Senator.
Senator Levin. Any of you know?
Mr. Graham. No.
Mr. Pime. No.
Senator Levin. Thank you, Mr. Chairman.
Senator Cochran. Thank you, Senator Levin.
Senator Thompson.
Senator Thompson. On the license issue, is my understanding
correct that if something's on the munitions list at the State
Department, then the administration's got to give Congress 30
days notice?
Mr. Schneider. Correct.
Senator Thompson. That does not mean that Congress has
special power over these sales. Congressmen can object or make
a speech, but the only power that we have is the power we have
anyway, and that is to pass a law prohibiting it. There's no
special override on the part of Congress, is that right?
Mr. Schneider. On these transactions, Senator, the Congress
can submit a resolution of disapproval. And if that is passed
by the Congress, then the sale cannot be consummated.
Senator Thompson. That's legislation.
Mr. Schneider. Yes, its a specific form described in the
law.
Senator Thompson. Is one of the consequences now of
transferring this authority from the State Department to the
Commerce Department that there no longer is that 30-day notice
requirement?
Mr. Schneider. That's correct. There are two different
statutes involved.
Senator Thompson. When it was under the State Department,
you had to give Congress 30 days notice, so they could at least
voice an objection.
Mr. Schneider. That's correct.
Senator Thompson. Now, that it's been changed to the
Commerce Department, Congress does not even get that 30 day
notice, is that correct?
Mr. Schneider. That's correct.
Senator Thompson. All right. Also with regard to the waiver
issue, I don't think the fact that there have been waivers
under various administrations, is an issue. I mean, it's not a
waiver is a waiver is a waiver, or a transfer is a transfer is
a transfer. I think that the issue is what is being waived,
what is being transferred. There is a difference between a
transfer that contains militarily sensitive material and a
transfer that does not.
Also, I would assume that whether or not there was a viable
USSR might have something to do with decisions as to what one
would transfer in these circumstances. Also, the process by
which these decisions were made would be relevant.
I think when we acknowledge that there are several waivers
at several different times, we have to go a little further than
that and determine exactly what was waived and under what
circumstances and what were the processes.
Now, you've mentioned some of the different standards
between the Commerce Department and the State Department. As I
understand it, there's one license required at the Commerce
Department, two licenses at the State Department.
Mr. Schneider. Yes, there are different types of licenses.
For example, to market products that are licensed by the State
Department, you need one type of license. And to transfer
technical data, you need another type of license. To actually
transfer the hardware, you need yet a different type of
license.
So the aim is to protect as best as can be done through the
regulatory process, access to defense-related technology.
Senator Thompson. Well, for a matter under the State
Department on the munitions list, don't you have to have a
license even to begin to enter into discussions with the
Chinese, for example?
Mr. Schneider. Yes.
Senator Thompson. That's not true with the Commerce
Department, is it?
Mr. Schneider. That's correct.
Senator Thompson. As I understand it, according to this GAO
report, the Bush interagency group and subsequently the Clinton
interagency group all agreed that if these satellites contain
militarily sensitive characteristics integrated in them, they
should remain at the State Department, right?
Mr. Schneider. Correct.
Senator Thompson. Are you familiar with these nine
sensitive characteristics, anti-jam capability, antenna cross-
links, encryption devices, pointing accuracy, and all of that?
Are you generally familiar with those?
Mr. Schneider. Yes, I am.
Senator Thompson. Do you agree with the interagency
determinations that if those sensitive military matters are
present within these satellites, they should remain under the
stricter standards of the State Department? Do you agree with
that?
Mr. Schneider. Yes, I do, sir.
Senator Thompson. Is it not also true that now, since 1996,
when the shift was taken, that even if a satellite contains any
or all of these characteristics, pointing accuracy, propulsion
system, the others that I mentioned, that that still rests with
the Commerce Department now?
Mr. Schneider. That's correct.
Senator Thompson. All right. There's been some writing in
the professional journals concerning intangible know-how. Dr.
Graham, you might respond to this, or all of you. Hardware is
one thing, but one of the matters we need to be most concerned
about is the transfer of intangible know-how. We should take
special care regarding conversations that might go on, the
information that might be transferred pursuant to U.S.
companies trying to make sure that these rockets work.
Do you share that concern?
Mr. Graham. Yes, Senator. I'm an engineer speaking with
this criticism, but we engineers are trained our whole lives to
look at equipment capabilities, analyze them, look for flaws,
errors, and anything else that would cause failure or trouble,
and try to solve the problem.
That's what engineers do. It's almost impossible to stop
them from doing that, and almost no matter where you put them,
that's what they're going to do. Experienced U.S. engineers
have intangible knowledge that can very easily be transferred
to foreign engineers, if you put them together.
Senator Thompson. Well, I understand that the statement is
made sometimes in response that monitoring does occur. But my
information is that there's no absolute requirement that the
Department of Defense monitor and be present at all times with
regard to discussions, the mating of rocket to satellite, the
launching and all of that. That in fact, with regard to the May
19 Lockheed Martin Marietta launch, that they went to the
Department of Commerce and asked them to provide monitors. Are
you familiar with that point?
Mr. Graham. I'm generally familiar with the fact that
Martin initiated the request for monitoring, not the U.S.
Government, Senator.
Senator Thompson. Do you know whether or not in practice
there's an absolute requirement that Department of Defense
monitor and be present at all stages?
Mr. Graham. I would defer to Dr. Schneider.
Mr. Schneider. My understanding is that no, that is not the
case. This illustrates the difference between a commercial
license and a State Department license. The State Department
license limits what technology can be transferred. And there
are procedures that a vendor is required to follow that
restrict even the amount of informal knowledge he is allowed to
transmit. He is told exactly what he can transmit, the vendor
is required to submit a technology transfer control plan, in
most cases, so that they know exactly how the information will
be transferred, under what procedures and so forth.
But with a Commerce Department license, the idea is to
transfer the asset and its functionality. And there is not a
procedure in ordinary Commerce Department licenses for the
control of this informal transmission of information. And the
idea of a monitor would probably be of some help, but it would
still be difficult to control the transfer of information if
there was not otherwise a requirement in the license to do so.
Senator Thompson. All right. Let me ask you one more
question. Are any of you gentlemen familiar with the
Coordinating Committee for Multilateral Export Controls, which
the United States was a member of?
Mr. Schneider. Yes, I'm familiar with it.
Senator Thompson. Dr. Schneider, what was the function of
that entity? And why did we get out of it?
Mr. Schneider. It was established in 19149 among the United
States and our European allies, to restrict the flow of
initially arms to the Warsaw Pact, but later, to control the
flow of technology that would enhance the military performance
of the Warsaw Pact. It was a non-treaty based organization,
headquartered in Paris, that coordinated the export control
activities of the member states.
At the end of the Cold War, the U.S. Government was unable
to persuade allied governments to continue the existence of the
COCOM organization. So a new entity was established in 1994
called the WASSANAAR arrangement, after the river in the
Netherlands where the meeting was held. This arrangement does
not control the transfer of technology, but only limits the
flow of, let's say, it requires notification after sale of
military equipment to essentially pariah states.
Senator Thompson. Did the United States remove itself from
the original organization?
Mr. Schneider. No, the United States agreed not to continue
COCOM and to seek a new----
Senator Thompson. When did that happen?
Mr. Schneider. In 1993.
Senator Thompson. Did the COCOM, as you've referred to it,
would that have placed stricter requirements on the exports of
these commercial satellites than what we have today?
Mr. Schneider. Yes.
Senator Thompson. That's all.
Senator Cochran. Senator Collins.
Senator Collins. Thank you, Mr. Chairman.
I want to follow up on some questions that Senator Thompson
posed to you about the differences between the procedures used
by the Department of State and the Department of Commerce. It
seems to me one basic difference also lies in the mission of
the two departments. And indeed, when you look at the people
who are appointed to be the Commerce Department Secretary, they
often have highly political backgrounds. But I can't think of
any in recent history who had national security expertise.
And this area, of course, is very technical and does
obviously involve complex aspects of national security.
I'd like to ask each of you which department or agency you
believe should have primarily responsibility in the area of
export control of space technology. Dr. Graham, let's start
with you.
Mr. Graham. It's my personal view that the greatest
expertise in that area resides in the Department of Defense,
since they are the agency that develops, or at least used to
develop, ballistic missiles for the United States, and also is
an extensive user of space launch technology.
So from a national security and generally national benefit
point of view, I would feel most comfortable if the primary
responsibility in the area of export control of space
technology resided ultimately with the Department of Defense.
Senator Collins. Mr. Pike.
Mr. Pike. I think that the current arrangement where the
Bureau of Export Administration at the Department of Commerce
has primary responsibility for dual-use technologies is the
correct arrangement. The challenge, of course, that we have is,
unlike the situation in the Cold War where we were mainly
concerned with primarily military exports, the concern today is
primarily with dual-use technologies like supercomputers, like
space launch components.
I think that the Bureau of Export Administration, their
proper place is trying to strike the balance with American
competitiveness and other interests.
Senator Collins. Dr. Schneider.
Mr. Schneider. The two export control regimes--the
Department of Commerce regime and the Arms Export Control
regime--have their origin in different statutes with different
purposes. The State Department export controls over the U.S.
Munitions List is derived from the Arms Export Control Act. The
purposes of that act are to assure the congruence of exports
with the foreign policy and national security interests of the
United States.
The export control regime managed by the Department of
Commerce is derived from the Export Administration Act. And the
purpose of that is to promote the commerce of the United
States, and for that reason, I believe that the licensing
apparatus should be managed by the national security apparatus,
because of the coupling of this technology to U.S. national
security interests.
I think the arrangement that the Department of State
manages with interagency consultation, where the office with
the most expertise, whether it's the Department of Defense or
the Department of Energy, whatever, is the one that dominates
licensing decision. I think that is an acceptable way of
managing and should be continued.
Senator Collins. So Dr. Schneider, you would disagree with
the decision that the Clinton Administration made to transfer
the primary responsibility from the State Department to the
Commerce Department?
Mr. Schneider. Correct.
Senator Collins. Thank you.
Dr. Graham, I'm interested in the issue of the technology
transfers that can happen in the event of a launch failure.
It's been reported that a so-called black box containing
decryption hardware is missing from one of the satellites
launched unsuccessfully by China, one of the ones that
presumably blew up.
The New York Times has reported that similar devices are
used to communicate with American spy satellites, and that the
Pentagon and intelligence agencies were concerned that anyone
who could crack the code could take control of the satellites
themselves.
Now, the National Security Advisor, Sandy Berger, has
dismissed technology transfer concerns on the grounds that
China had no access to the technology in U.S. satellites,
because such devices are sealed into a container that's not
opened until the satellite actually leaves the booster in
space. But isn't there a danger in the event of a failure that
there will be unexpected access to technology, to very
sensitive technology?
Mr. Graham. Yes, there is, Senator Collins. I am not
familiar with the details of this particular satellite and its
encoding devices. But it's common to provide some degree of
encryption in what is called the telemetry command and control,
or housekeeping system for the satellite, so that unauthorized
users can't come in by radio link and disorient or otherwise
cause the satellite to malfunction once it's on orbit. You
basically protect yourself against rogue data streams coming
into the satellite with encryption.
That is in part embedded in the hardware in the satellite,
and in part in the software. That hardware will be placed
inside black boxes in the satellite, and should the satellite
and booster fail on the way to orbit, those black boxes will be
scattered over the landscape, or the seascape, depending where
it comes down, and are available for whoever finds them first.
While they will tend to be rather damaged-looking from the
outside, my experience with such failures is that you can learn
a great deal by taking them apart.
Senator Collins. Mr. Pike, do you share the concerns
expressed by the Pentagon and intelligence agencies and Dr.
Graham about the access that could occur in the event a
satellite blows up?
Mr. Pike. This is obviously dependent on technical details
that can't be discussed in an unclassified forum. I think that
it's certainly safe to say that, for instance, in the immediate
aftermath of the Challenger accident, one of the very highest
priorities the U.S. Government had was not recovering the
bodies of the astronauts, but rather recovering the
cryptographic support materials that were on the communications
satellite carried by the shuttle.
The cryptologic systems used by American military
satellites are obviously of a different type and a different
standard than those used on commercial satellites. However,
obviously, commercial satellite operators have an interest in
making sure that backyard enthusiasts can't commandeer the
satellite to have their own pirate television station, as was
done before these cryptographic systems were implemented in the
early 1980's.
But at the same time, normally these systems are embedded
in chips that have been hardened to make it extremely difficult
to open the packaging of the chip without completely destroying
the underlying chip. And even having access to the
cryptosystems electronics hardware might enable you to
replicate that type of hardware, but it is not going to give
you the keys to getting access to enable you to commandeer a
commercial satellite. And certainly not a military satellite.
And of course, the United States has been trying to get
other countries to implement these type chip-based cryptologic
systems, to make it easier for the National Security Agency to
read their communications. So the notion that the Chinese are
going to be trying to replicate a cryptographic system whose
chief virtue is that it's certified to be readable by the
National Security Agency is not something I'm terribly worried
about.
Senator Collins. Dr. Schneider, do you have a concern in
this area?
Mr. Schneider. Yes, I think it logically follows, if the
public policy was to protect the access to the content of the
satellite before it went on then it follows that if the
satellite should be destroyed, and the contents inaccessible to
unauthorized parties, that it would be a concern of the United
States.
Senator Collins. It seems that it would be a concern to me,
also.
Thank you, Mr. Chairman.
Senator Cochran. Thank you, Senator Collins.
Dr. Schneider, in your capacity as Under Secretary of
State, you had a responsibility for supervising this munitions
list that we've talked about. You served in that capacity for
how long?
Mr. Schneider. Four years, sir.
Senator Cochran. And now I understand you are chairman of
the State Department's Defense Trade Advisory Group, is that
correct?
Mr. Schneider. That's correct, Mr. Chairman.
Senator Cochran. Can you tell us, based on your experience
in these positions, if there is a substantial difference
between a technical assistance agreement that was required when
a munitions list item was to be sold or transferred, and the
current policy in this administration? And if there is a
difference, what is that difference, and what was the reason
for the technical assistance agreement?
Mr. Schneider. Do you mean the difference between a TAA in
the State Department and the Commerce Department?
Senator Cochran. Yes, the current license or----
Mr. Schneider. OK. A technical assistance agreement is
required under a munitions license any time you transfer
technical data that is not in the public domain. This can be
classified or unclassified. It requires this review.
The review is extremely thorough, and very few licenses are
issued without what are called provisos, which are further
restrictions on how the technical data can be transferred. It
has a high order of rigor, because the technical data is often
the key to understanding the performance of the system.
Because of the differing philosophies between the two
export control regimes, the Commerce Department normally
doesn't license technical data. In some cases they do, but it's
not a primary feature of Commerce Department licenses, because
of the philosophy of the export control. They are mainly
transferring the functionality of the system, and don't seek,
in most cases, to control the transfers of the technical data,
per se.
Senator Cochran. There is a list that I have been given of
14 categories of technical data. I'm advised that these relate
to missile launch activities or characteristics or components.
I'm giving a copy, asking the staff to give a copy to each
witness and each Senator. I will also ask that a copy be made a
part of the record.
[The information supplied follows:]
1. Form, fit, and function
2. Mass
3. Electrical
4. Mechanical
5. Dynamic/environmental
6. Telemetry
7. Safety
8. Facility
9. Launch pad access
10. Launch pad parameters
11. Telemetry, tracking and control maintenance data
12. Satellite system data such as power, weight, and fuel
budgets
13. Observance of satellite test
14. Operational training for customer personnel
Senator Cochran. I'm wondering if you can tell us if these
technical data categories would have been included in a
required technical assistance agreement as part of the license,
if the transfer of commercial satellites were still a munitions
list item?
Mr. Schneider. Yes, they would, and there would be
additional ones to that.
Senator Cochran. Can you tell us what the significance of
these technical data items would be in terms of technology
transfers that could be harmful to the United States, in the
hands of the wrong country?
Mr. Schneider. Each of the items on this list pertains to
matters relating to the integration of the payload to the
booster. That's why they would be considered categories that
the applicant would have to provide, if it was a Department of
State munitions license. They would have to, in addition to
providing the information, the license would specify exactly
what form, fit and function data could be transferred.
Frequently they will say in addition what cannot be
transferred.
The applicants are required to do a substantial amount of
record keeping and reporting and so forth relating to the
implementation of that license.
Senator Cochran. And as I understand it, the Commerce
Department's control list and its licensing requirements and
rules don't include any such technical data categories or
specific authority to discuss technical data, is that correct?
Mr. Schneider. In the case of the arrangements that were
made during the transfer of the commodity jurisdiction, the
Department of Commerce has undertaken a higher order of review,
then it is the case normally in Department of Commerce licenses
with respect to the transfer of satellite systems.
As Senator Levin mentioned, the Commerce Department leads
an interagency process that undertakes reviews that can cover
this particular material. As I mentioned, I'm not intimate with
the details of how the interagency process is being conducted.
So I can't really comment as to whether they take each of these
items in detail. But the fact that they have an expanded review
would certainly give the agencies the authority to comment on
these issues if they chose to do so.
Senator Cochran. I understand that some companies, despite
the absence of a requirement to do so, are continuing to go to
the State Department to obtain what amounts to a technical
assistance agreement, or TAA license. Is that your
understanding?
Mr. Schneider. Yes, I have heard that. That may be for
applicants who have previously had export licenses issued by
the Department of State, and are following up on that. I don't
have any specific knowledge of why they've chosen to do that.
Senator Cochran. Based on all of these facts that you have
given us, is it fair to conclude that export control
requirements on commercial satellites have become less
stringent since being moved from the munitions list to the
Commerce control list?
Mr. Schneider. I believe that's the case.
Senator Cochran. On October 8 last year, the manager for
export compliance at the Hughes Space and Communications
Company wrote a letter to the Commerce Department, seeking
guidance on whether the technical data I mentioned, these 14
categories of technical data, requires an export license.
And I understand the Commerce Department has not replied to
that letter of 7\1/2\ months ago, even though for the first 10
categories, the official with Hughes wrote, ``We believe that
this data is classified as EAR99, exportable under the Commerce
Department license exception NLR.''
And I'll ask that this letter be made part of the record,
and a copy provided.\1\
---------------------------------------------------------------------------
\1\ The letter, dated October 8, 1997, appears in the Appendix on
page 65.
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I'll also note that the Commerce Department license
exception NLR stands for, I think, ``no license required.''
Mr. Schneider. Correct.
Senator Cochran. For the last four categories, the Hughes
official wrote, ``Since there is some difference of opinion as
to what event triggers the ability to utilize a Commerce
Department license exception, please clarify conditions under
which the exception is applicable.''
What is your reaction to that in terms of the Defense
Department memorandum that we earlier talked about that
mentioned transferring jurisdiction of this data, these 14
categories to the Commerce Department, and the Commerce
Department handling it? How important do you consider the
licensing oversight of technical information transfer under
these circumstances to be?
Mr. Schneider. I think it's very important if the
technology is pertinent to matters relating to national
defense. I think for items that are not so required, that it
would constitute a burden on the Commerce Department.
Senator Cochran. Dr. Graham, you have in front of you that
list that I refer to that was included in the Hughes letter.
What is your opinion about whether we should be concerned that
one of the major aerospace companies is operating on the
impression that 10 of these 14 categories requires no technical
assistance license? Or for that matter, any license? And for
the last four categories, clarification of administration's
policy is necessary?
Mr. Graham. Well, Mr. Chairman, these are just categories,
of course. But in looking at them, I would be very concerned
that if there were an unconstrained dialogue or cooperative
engineering work that was performed, even seemingly simple ones
like mass involve far more than just how heavy the satellite
is.
The distribution of the mass, the concentricity of the
mass, the moments of inertia that it provides to the missile
are all very important in not just the weight, but also how it
affects the dynamic response of the missile, or rather the
space launch vehicle satellite system. That is picked up in
item five again, dynamic environmental, when you get into a
dynamic analysis of the space launch vehicle, and its
satellite.
Here again, I believe it would be virtually impossible for
an American engineer to look at a space launch vehicle
satellite combination, observe some kind of a serious problem,
or perhaps even critical flaw in the space launch vehicle, and
go ahead and let the satellite be launched with a high degree
of knowledge that it might not reach orbit, without saying
something about it.
Of course correcting flaws in either the structural,
electrical or other elements of the system are also directly
applicable to both liquid and solid ICBM systems. Telemetry is
another category; it tells you how well the SLV system is
working on its way to orbit and tells you what problems it's
having, if any.
So I think each of the categories on this list warrant
further exploration. But some of them are clear areas of
potential technology transfer that would be adverse to the
United States.
Senator Cochran. And it seems, if I'm concluding correctly
from the Hughes letter, that they believe this data is
exportable under the Commerce Department license rules. And
according to what I understand from you and Dr. Schneider,
these are items, technical data items, that could very well be
employed by the recipient country in a militarily useful way
that could endanger our national security, is that correct?
Mr. Schneider. Yes, if these items transferred are applied
for military purposes, yes, they could be.
Senator Cochran. And how does that compare with the State
Department notice about the transfer of these munitions list
items to a Commerce Department licensing regime and then the
statement that enhanced regulations have been developed and
agreed upon, an individual validation license will be required
for all destinations, etc. Obviously, Hughes and others had
copies of these regulations.
And then for them to be able to conclude that no license
was required for 10 of these items. Doesn't seem to me that
these are enhanced regulations, these are much more relaxed
regulations. Is that the conclusion that you come to as well?
Mr. Schneider. The process that was set up under the
Department of State notification so that it could produce the
same results. And I haven't audited this process to see how
it's actually working.
But if the situation spins out as you describe it, it could
produce unintended transfers of technology that's pertinent for
military purposes.
Mr. Pike. That's not self evident from this list, though.
Senator Cochran. Mr. Pike, I didn't ask you. I'll ask you a
question later.
Mr. Pike. All right.
Senator Cochran. Senator Levin.
Senator Levin. Thank you.
Relative to the shift from the State Department to the
Commerce Department, this occurred after 17 licenses were
issued for a launch in China, is that correct?
Mr. Schneider. That's correct.
Senator Levin. So the vast majority, including the one that
blew up, was on the munitions list?
Mr. Schneider. Correct.
Senator Levin. Then when the transfer was made, at the last
three, Congress had an opportunity for 30 days for someone to
file a bill or someone to object. I don't know of any effort on
the part of Congress or anyone in Congress to object to that
transfer. None of our witnesses seem to know of any effort at
that point, either.
But there's another point. And that is that when we come to
China, it is the same process in terms of a Presidential
waiver, whether or not you had a State Department or a Commerce
Department issuing the license. Now, again, with the vast
majority since 1988, since President Reagan started down this
road, the vast majority, 17 out of 20, it was a State
Department license, that means a munitions list issue. And they
all got approved.
But in all 20 of the 20, there was a Presidential waiver,
which involved a National Security Council recommendation to
the President.
Now, do any of you know, relative to that National Security
Council recommendation that occurred with all 20 of these--
which gets us a little closer to your point, Dr. Graham, about
getting the Department of Defense involved in this, because I
think that is a critical issue--relative to that National
Security Council recommendation to a president, be it President
Bush or President Clinton, was that process in those 20
instances any different whether or not the State Department
started down the licensing road in 17 of the 20, or the
Commerce Department started down the road? Do you know of any
differences in that waiver review, which involved the National
Security Council, do you know of any differences, Dr.
Schneider, in that review process?
Mr. Schneider. No, the waiver is a separate process from
the analysis of the transfer itself.
Senator Levin. And do you know, are you familiar with that
process?
Mr. Schneider. Not in detail. Only in the structure you
describe, I have heard of before.
Senator Levin. Do you know of any difference in the
National Security Council involvement in this waiver process,
be it under the first 17, whether it was the State Department,
or the last three under the Commerce Department?
Mr. Pike. There were certainly important differences in
terms of the policy objectives that were sought and granting
the waivers. Because we had not been granting these waivers
simply because American satellite companies wanted to fly on
Chinese launch vehicles. This has been part of our non-
proliferation policy with respect to China.
On several occasions, we have withheld these pending
resolution of non-proliferation concerns with the Chinese. And
they were only brought forward once the Chinese had made
representations that were satisfactory to the concerns we then
raised.
But apart from that very important policy difference, which
I think highlights a lot of why we had been doing this,
procedurally, I think they were approximately the same.
Senator Levin. As far as the procedures used with a
Presidential wavier?
Mr. Pike. Essentially.
Senator Levin. The same whether it was the State Department
or the Commerce Department? Do you know, Dr. Graham?
Mr. Graham. Senator, I haven't followed this process since
I left government, so I don't know.
Senator Levin. There are some differences between State
Department and Commerce Department licenses. There's no doubt
about it. And items are shifted, by the way, from one list to
another, with notice to Congress. There are differences.
But in the case of China, when we're talking about
satellites, you have a totally different track, whether it
starts up here at the State Department, which it did 17 out of
20, or up here, the last 3, with the Commerce Department. It
then gets into a single track which goes through an interagency
process, and then a recommendation from the National Security
Council to the President.
DOD is deeply involved, as it should be, in that track, by
the way. But I think it's important that we know the difference
between the Commerce Department and the State Department. I
think that's a very relevant issue. But it's not nearly as
relevant, and indeed may be totally irrelevant relative to
those particular transfers.
Because in the case of China, with the satellites, they all
go through this Presidential review process involving the
National Security Council. And I think, Mr. Chairman, it would
be very useful for us to have somebody either answer for the
record or somehow or another tell us whether or not there was
any difference in that National Security Council process,
depending on whether or not it started off on the State
Department track or on the Commerce Department track.
I don't believe there is. And if there isn't, it seems to
me relative at least to the satellite issue that this
distinction between the State Department and the Commerce
Departments is not relevant. It is a relevant distinction for a
whole lot of other issues. But when it comes to the issue of
export or transfer to China of satellites, it's not relevant,
if the key issue is a Presidential waiver, made on the
recommendation of the National Security Council, no matter
whether or not the initial review started in the State
Department with that munitions list, or started in the Commerce
Department with its own list.
So Mr. Chairman, I would like to ask for the record, from
the National Security Council, whether or not their process of
review for Presidential wavier purposes is any different,
dependent on whether the licensing process began with the State
Department or with the Commerce Department. If we could do that
for the record.
Senator Cochran. I suggest we draft a letter, you and I
sign it, send it to them, and ask for a response for our
record.
Senator Levin. One last question. A number of other
countries apparently, allegedly do not treat civilian
satellites as munitions. Is that correct, Dr. Schneider?
Mr. Schneider. Yes, that's correct, Mr. Chairman, and I
think that's been one of the frustrations that has led to the
change in commodity jurisdiction. The United States, I believe,
is the only producer of satellites that had maintained
satellites on a munitions list.
Senator Levin. We were the only producer of commercial
satellites which at one point had them on a munitions list?
Mr. Schneider. That's correct.
Senator Levin. And the other countries that produce
satellites did not?
Mr. Schneider. Did not. Yes. And as I said, that's one of
the things that stimulated the effort to move it from the
munitions list to the Commerce Department list.
Senator Levin. Thank you so much.
Senator Cochran. Thank you.
Senator Thompson.
Senator Thompson. Thank you very much.
I think we still have a bit to understand about the
distinctions between the waiver process and the license
process. By the time a wavier gets down to the Department, I
would assume they would know what their boss, the President of
the United States, would want. I think that some might assume
that the review process would be just as rigorous under those
circumstances as if they were on the munitions list, for
example. I question that.
But let me ask you about the explosion that happened in
February 1996 which destroyed a $200 million Loral satellite.
There was an investigation conducted in the cause of that
accident which has since caused some controversy as to whether
or not sensitive information was given to the Chinese pursuant
to that investigation.
Gentlemen, are you generally familiar with that situation,
and what can you do to enlighten us with regard to what
happened and what the potential problems are there? Let me tell
you what my understanding is, then you can correct me or fill
in, to the extent that you can.
I understand that after that explosion, Hughes-Loral did an
investigation and prepared a report. They determined that it
was the guidance system that was essentially the problem. There
was a question raised as to whether or not that information
should have been given to the Chinese. I think even the Hughes-
Loral people voluntarily--I think the phrase was used--turned
themselves in. Whether that's a correct phrase or not, I don't
know.
I've also read where the Department of Defense has
determined that national security was harmed by releasing this
report to the Chinese. What do you know about the instance, and
what is the significance? Dr. Graham.
Mr. Graham. Senator Thompson, let me address what I've seen
in the press about it. I've seen statements that the Defense
Department, as you said, has judged that as a part of the
review of the launch failure, information was transferred by
Loral to the Chinese that would benefit Chinese construction
and operation of both space launch vehicles and ballistic
missiles. I have not seen any statements in the press by the
Defense Department or any other government agency, that
contradicts that conclusion. I'm afraid I have to leave it
there in this particular forum.
Senator Thompson. As far as the facts, Dr. Schneider, can
you elaborate on that in any way?
Mr. Schneider. I read the same material, and that's my
understanding of what took place. From a regulatory
perspective, my presumption is that transferring information
about the guidance section would require a separate license. If
that is indeed what happened, then that activity would of
course need to be licensed for authorization.
Senator Thompson. Is this one of the kinds of problems that
just arise in these sorts of things? I mean, it stands to
reason that if you put up a $200 million satellite and it's
destroyed, you want to tell the people who are going to put the
next one up, maybe, what went wrong. And therein lies the
inherent problem, I suppose.
What about the May launch of the Motorola satellites? My
understanding is they were using dispensing technology. Can you
describe dispensing technology and how that is used
commercially? What purpose is serves?
Mr. Graham. Yes. The Motorola launch, I believe, was for
one of the sets of Iridium satellites that will form a low
orbit constellation of cellular telephone base stations. Each
of these satellites is relatively small, smaller than the
payload of the Long March or most other space launch vehicles.
Therefore, it's economical to put several of these satellites
on the same space launch vehicle and take them to orbit
simultaneously.
But of course, you don't want to put them in exactly the
same orbit. You want to at least disperse them enough so they
won't interfere with each other while they finish the maneuvers
necessary to get them to final desired orbits. Therefore, you
have to be able to release them carefully to allow them to
reach their pre-planned orbits.
Senator Thompson. It's been written that this is the same
thing as MIRV technology. Is that essentially correct, in your
opinion?
Mr. Graham. This is very similar to MIRV technology.
Senator Thompson. Mr. Pike can speak for himself, but I
understand, Mr. Pike, your point was that with regard to
commercial satellites, they dispense the satellites more slowly
than in a military situation?
Mr. Pike. That's correct.
Senator Thompson. A military application would be more
rapidly dispensed?
Mr. Pike. An ICBM basically has about half an hour from
launch to impact. The MIRV busing phase, typically you're only
looking at about 10 minutes or so.
I'm not familiar with the precise deployment sequence in
the case of Motorola Iridium, but in the case of U.S.
intelligence community satellites, where you have multiple
deployments, those typically take place over a period of
several days.
I think if the Motorola people were able to go to the
Chinese with some confidence that they would succeed in this
regard, because the Chinese had demonstrated a multiple launch
capability off a single launch vehicle, the ability to deploy
several satellites on a single launch vehicle, about two
decades ago. So there was nothing particularly novel or in my
view, immediately militarily significant in the Iridium launch.
Senator Thompson. Well, doing something and knowing how you
do it are two different things. Perfecting it, I think, would
be also.
But I assume that leads you to the conclusion that it's not
a big problem if we can enhance the Chinese capability to use
this dispensing technology. Because that transfer from the
commercial to the military is, I assume in your opinion, not as
significant as a lot of other people think it might be.
Dr. Graham, what's your response to that?
Mr. Graham. I think it can be quite significant. In the
first place, we need to look at the time lines on the Iridium
deployment. In fact, with ICBMs, we do some final maneuvering,
much as we do with satellites, when we insert independently
targeted re-entry vehicles.
The device on an ICBM that deploys multiple independently
targeted warheads is called a bus. It moves the satellites
around in space and velocity until it has each on the right
line to the target, and then releases it. A similar process
conducted is done with multiple satellites. The time lines for
the space launch can be longer, or can be the same as for the
ICBM without damage to the space launch. It just depends on how
you want to go about it.
Senator Thompson. So you don't think that difference in
timing is that significant?
Mr. Graham. No, Senator.
Senator Thompson. That's all I have, Mr. Chairman. Thank
you very much.
Senator Cochran. One other characteristic of the policy
that you administer, Dr. Schneider, at the Department of State,
was that a Department of Defense monitor, a person who would
observe discussions and transfer of data, was required as a
part of the process and procedure. What is, in your view, the
importance of having that monitor involved in the process and
does the absence of such a monitor now under current policy
present any particular problems for our national security?
Mr. Schneider. The incorporation of provisions for a
Department of Defense monitor occurred subsequent to my
departure from the government. But during my own service on
China exports, there were several cases where there was a
requirement for a U.S. monitor. The general purpose of this is
to assure compliance with the terms of the license, that the
license was implemented by the specific end user identified in
the license, and for the purposes identified in the license.
The procedure was designed to monitor efforts to divert the
product transferred to an end use that was not specified in the
license. The absence of a monitor then creates a compliance
issue as to whether or not compliance can be monitored by other
means.
Senator Cochran. Do you think the lack of a requirement
under current regulations for the presence of Department of
Defense monitors to be a weakness in the current policy?
Mr. Schneider. If they don't have any other means of
monitoring compliance, then there could be some difficulty. I
haven't seen the details of the license as to whether they have
perhaps other U.S. Government officials, other than the
Department of Defense, doing the monitoring, or some other
means to sustain compliance. But if they have no one
monitoring, then there presumably is no other way to assure
compliance.
Senator Cochran. Dr. Graham, when we were preparing for the
hearing, we learned that there was an impending Chinese launch
scheduled of a Lockheed Martin ChinaStar-1 satellite. The
ChinaStar-1 license was granted in 1996. And according to
Lockheed Martin officials, the license required no Department
of Defense monitor for any phase of the export.
We were told that Lockheed Martin requested the monitors,
despite the absence of a licensing requirement. My question is,
by not having Department of Defense monitors present at these
meetings between the satellite builder or vendor and the
Chinese launch team officials, does this increase the risk, in
your opinion, of technology transfer and intangible know-how
transfer that could be militarily useful to the Chinese?
Mr. Graham. I believe it does, Senator Cochran. As you
know, I'm not in favor of this process in any of its forms.
This would be an effort to mitigate the damage done to the
United States by adverse technical transfer to the Chinese. It
could have some of that effect if there were a set of clear
terms of reference, guidelines, and constraints imposed on the
contractor before the discussions began, and if the government
monitors, or chaperons, were competent to know when those terms
were being observed and when they were being violated. It would
also provide the opportunity for the contractor to hold
discussions on issues before material was presented to the
Chinese. Once you have said something or given some material,
it doesn't come back, so it's a very irrevocable act.
While I would not encourage any of this type of
technological interchange or transfer, if it's going to be
done, I think having the strongest possible chaperons present
would be in the U.S. interest.
Senator Cochran. Dr. Graham, would it surprise you if an
engineer or scientist were to identify a problem and suggest
how it could be fixed, in the case of a launch vehicle, given
the financial situation and the risk of a loss of an expensive
satellite? Is it your view that these kinds of temptations
under the current situation are too great to overcome and stand
and remain silent while a launch is about to take place that
might very well be risky or destined to fail, and not point out
some deficiency?
Mr. Graham. Well, the economic issues certainly drive the
process towards tech transfer. But even beyond that, engineers
are trained and practice all their lives to find problems,
point them out, and fix them. So it would surprise me only if
the engineer did not do something to try to rectify the problem
once he saw it.
Senator Cochran. There are many low-Earth orbit
communication satellite constellations deployed or planned for
the future, and they are driving the demand by U.S. satellite
manufacturers for foreign launch services.
What needs to be done, in your opinion, to keep these
launches, or at least more of them, within the United States?
Do we not have the launch capability here to handle the volume
of launches that are in demand now by the communication
companies? And if we don't, what should we consider doing about
it?
Mr. Graham. Senator Cochran, in the early 1960's, we built
a thousand Minuteman missiles in something on the order of 6
years. It is inconceivable that the industrial bases of the
United States couldn't provide adequate launch systems for all
the satellites that the United States builds.
I believe this is basically an economic issue, where
satellite owners and builders are attempting to take advantage
of the prices that these non-market economies, such as China,
are willing to provide and receive in turn the recognition of
their ballistic missile and satellite capabilities, the
technologies they will get from it, and the western hard
currency to sustain their rocket infrastructure.
But the United States could certainly build the needed
SLVs.
Senator Cochran. Dr. Schneider, one aerospace executive
told us as we were preparing the hearing, that he views the DOD
monitors that you and I were talking about as important because
companies tend to view their foreign launch service providers
as customers. Hence when the customer wants something, you want
to try to help him out. And U.S. companies try to respond in a
way that establishes a good relationship for future business
dealings.
Do you think this attitude is prevalent, or a problem among
American satellite manufacturers? And what if anything can be
done to prevent it from making technology transfer commonplace?
Mr. Schneider. Well, I don't think this is necessarily a
conflict. Because in the case of munitions list transfers of,
say, conventional munitions to convention arms to allies
abroad, the ally abroad is, of course, a customer as well.
But the terms of the license restrict the U.S. vendor from
transferring information. My own experience in the Department
of State is that the vendor community was very familiar with
these restrictions and would inform the customer that they
cannot give them information of a specific type, because it was
proscribed by the terms of the license.
So I think because this practice generally works pretty
well, there is not a normal requirement for a Department of
Defense monitor to be associated with all munitions list
transfers. The licensees enforce the transfers themselves,
because there are indeed draconian penalties for failure to do
so.
Senator Cochran. Thank you very much, Dr. Schneider.
Senator Levin.
Senator Levin. I'll withhold any additional questions for
the record. Thank you very much, and thanks to these witnesses.
Senator Cochran. Senator Thompson.
Senator Thompson. Just one more observation. The question
still remains, and I certainly want to understand more about
this process myself, in a situation where a waiver must first
be obtained for these satellites, does that waiver create a
national security review process that's the same, regardless of
which control list the export item is on?
We saw the administration's national security process at
work. Secretary Christopher convened an interagency group
consisting of the Department of Defense, the State Department,
Arms Control and Disarmament Agency, the Commerce Department,
CIA, NSA and the entire intelligence community. It's decision
about licensing authority was overridden on the recommendation
of Ron Brown.
So that's the process that we saw work in one instance. And
I wonder, too, if the waiver process for an item that is not on
the munitions list is as stringent as it would be if the item
were on the munitions list. If it is, why take it off the
munitions list to start with?
Mr. Schneider. I think it applies less to China than
perhaps other markets. The munitions list treatment of any item
imposes a greater burden on the exporter than does the Commerce
Department license. And I think that has been what has driven
people to seek the commodity jurisdiction transfer to the
Department of Commerce.
But because of the special circumstances of China, there
has been this process of approving a waiver after the licensing
activity has been undertaken by the interagency process. That
is the device that's intended to assure compliance with the
U.S. national security objectives. If the administration has
set up a system where the President gets to make the final
call, that's all that can be done, I believe.
Senator Thompson. Thank you. That's all I have.
Senator Levin. Mr. Chairman, can I just briefly comment on
that?
Senator Cochran. Certainly, Senator Levin.
Senator Levin. My understanding is that the Ron Brown
reference was not to a waiver situation, but the transfer from
the munitions list issue. And that the State Department
approved every single one of the waivers.
But that's the kind of factual determination we can make
when that answer comes for the record. But I don't believe that
the Ron Brown position related to a waiver at all. It related
to a transfer from the munitions list to the Commerce
Department list, which he, of course, was fighting for. I'll
repeat that I believe that every single one of those waivers
was approved by the State Department.
Senator Cochran. I should have done this at the beginning
of the hearing, I hope you will forgive me for omitting this.
But for the record, could you state your professional training
and education and qualifications--Dr. Graham, and Mr. Pike and
Dr. Schneider?
Mr. Graham. Mr. Chairman, I have a bachelor's degree in
physics and a Ph.D. in electrical engineering. I've served as
an Air Force project officer, working at the Air Force Weapons
Lab, and working on, among other things, the Minuteman II and
III missile systems, and in subsequent work after I left the
Air Force, the Polaris and the Poseidon sea launch ballistic
missile systems.
I have generally been involved with ballistic missile
programs for about 35 years. I have also served as the Deputy
Administrator of NASA, was involved in resurrecting the
unmanned space launch vehicle capability of the United States.
Those are my primary activities in this area.
Senator Cochran. Thank you. Mr. Pike.
Mr. Pike. Mr. Chairman, my involvement is slightly less
illustrious than my colleague here. I've been Director of the
Space Policy Project at the Federation of American Scientists
for the last 15 years. I've done consulting work with NASA, the
United Nations and I'm a fellow of the British Interplanetary
Society.
Senator Cochran. What is your educational experience?
Mr. Pike. I attended Vanderbilt in Nashville, Tennessee, as
an undergraduate.
Senator Cochran. Dr. Schneider.
Mr. Schneider. Mr. Chairman, I'm an economist, Ph.D. from
New York University. I have worked for 16 years in the Federal
Government, including 4 years in the Department of State,
dealing with matters pertaining to export control. Subsequent
to my departure from the Department of State, I served as
Chairman of the General Advisory Committee on Arms Control and
Disarmament, and have monitored the export control system
throughout my career.
Senator Thompson. Mr. Chairman, if I may comment just very
briefly.
Senator Cochran. Senator Thompson.
Senator Thompson. While it is true the instance I mentioned
was not a waiver, it had to do with something much more
significant than a waiver. It had to do with the entire
transfer of the entire process. And it had to do with a
national security process, which I think is instructive when we
consider the process they may be going through with regard to
any individual waiver.
Thank you very much.
Senator Cochran. This has been a very interesting, and I
think productive, hearing for our Subcommittee. I appreciate
very much the attendance of the witnesses and the Senators for
participating.
I think we've learned first, that there can't be any
question about the potential military utility of commercial
satellite launches for ballistic missile and satellite
programs. And second, when commercial satellites received
export licenses from the State Department Munitions List, a
license was necessary for technical data that was shared with
China and others. And DOD monitors were required to be present
in all meetings and launch activities.
Third, since commercial satellites were moved to the
Commerce control list, the requirement for a license to share
technical information is at best ambiguous, with some companies
proceeding with them, and some without them. Furthermore, the
requirements for a DOD technical monitor is also ambiguous,
with some companies requesting monitors on their own volition
and other companies proceeding without them.
This sounds to me like a situation where militarily
significant technology transfer can occur and probably has
occurred. It's a situation at odds with the administration's
September 1996 representation to the Congress that enhanced
regulations have been developed and agreed upon by the
interested departments that will provide for both national
security and foreign policy controls under the Export
Administration Act for commercial satellites.
It's hard to understand why the administration has failed
to respond to a request 7\1/2\ months ago from the Hughes
Corporation for clarification of the current regulations. I
think it's clear the administration's export control policy for
commercial satellites isn't doing a good enough job of reducing
risks to American security.
We will continue to explore this issue. Our Subcommittee
will have another hearing on this subject in June, at a date
that we will announce later. We will invite the Commerce
Department to testify and explain why it worked so hard to gain
control of export licensing for commercial satellites, but has
done little to control their exports since gaining the
authority to do so.
We will likely invite some of the aerospace companies as
well to send representatives to discuss the licensing process.
Until then, the Subcommittee will stand in recess.
[Whereupon, at 12:34 p.m., the Subcommittee was recessed,
to reconvene at the call of the Chair.]
A P P E N D I X
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