[Congressional Record Volume 143, Number 158 (Monday, November 10, 1997)]
[Senate]
[Page S12480]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 ENCRYPTION EXPORTS NEED LIBERALIZATION

 Mr. DORGAN. Mr. President, in the final days of this session, 
the Congress is emersed in a debate over our Nation's trade policy. In 
my judgement, we have not focused enough attention on our policies that 
are hindering our ability to compete internationally and policies that 
are increasing our trade deficits.
  One issue that relates the ability of U.S. companies to compete 
internationally is the existing policy of the administration with 
respect to controls on the exportation of encryption technology. 
Currently, U.S. firms are the world leaders in encryption but other 
nations are gaining fast. Perhaps the greatest single factor in the 
erosion of U.S. dominance in encryption technology is the 
administration's export controls.
  As some of my colleagues know, there are several bills introduced in 
Congress to address encryption. The Senate Commerce Committee has even 
reported legislation in this area and I and the Senator from Montana, 
Senator Burns have been pushing alternative legislation that would 
require more realistic export controls on encryption. However, the 
administration does not need Congress to pass a law to change their 
policy in this area and I would like to encourage the administration to 
review their current policy and apply more realistic export controls on 
encryption technology.
  My understanding is that many other nations have multilaterally 
agreed to decontrol the export of computer software with encryption 
capabilities. Yet, the United States continues to impose unilateral 
controls. Thus, we have handicapped ourselves in the global market.
  Commercial products from companies in Germany, Japan, and England are 
securing more of the international market share because those nation's 
impose fewer restrictions on their encryption exports than we do. Mr. 
President, our Olympic team could not win if they had to compete with 
ankle weights. The same is true for American computer hardware and 
software companies. They face real competition in the international 
market place and their ability to provide strong information security 
features is costing them sales of computer systems and software 
packages. Lost sales will mean lost jobs.
  In my judgement we need to update American export control policy and 
catch up with modern realities of technology and the international 
market place. Unfortunately, rather than make real progress on this 
issue, the administration has raised all sort of new issues, such as 
attempting to impose more controls on domestic encryption. I hope that 
the administration will take a second look at their export controls and 
start making progress on developing a policy that will allow U.S. 
companies to compete. Short of that, I hope we will make some progress 
in the Senate in moving legislation sponsored by Senator Burns, the 
Pro-CODE bill, which will require a relocation of export controls, but 
done in a manner that is sensitive to national security and law 
enforcement concerns.

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