HIGH TECHNOLOGY SELLOUTS TO FOREIGN COUNTRIES
... FORCE U.S. TO TRUST WITHOUT VERIFYING USES

Insight magazine - page 29, May 25, 1998

The lengths to which Commerce Department officials will go to circumvent export controls of supercomputers to China has surfaced in documents released under the Freedom of Information Act. The documents show the Clinton administration approved the export of U.S.-built supercomputers to Communist China in late December 1997 even though Chinese officials were unwilling to allow on-site inspections of the delivery venue in order to satisfy a U.S. law.

But Commerce officials weren't going to let this little detail stand in the way of a supercomputer deal worth millions to Digital Equipment Corp., a U.S. company whose lobbyist, Anthony Podesta, is the brother of former White House official John Podesta.

Commerce officials working out of the Beijing Embassy were denied permission to inspect Xian Jiatong University prior to the export of the Digital high-performance computer. According to a Dec. 19, 1997, letter to Liu Hu, director-general for science and technology at China's Ministry of Foreign Trade and Economic Cooperation, or MOFTEC, cosigned by Commerce Department officials Amanda DeBusk, assistant secretary for export enforcement, and Roger Majak, assistant secretary for export administration: "We were disappointed at MOFTEC's decision not to allow an on-site end-use check and refusal to permit an embassy representative to travel to Xian Jiatong University at the university's invitation. Because we were unable to work through MOFTEC, we gathered information on the end-user through OTHER SOURCES and have approved the license" [my italics].

It remains undisclosed what the officials meant by "other sources," but it appears the Department of Commerce is only too willing to help Beijing save face rather than comply with the congressionally mandated law.

In the last four years, the Clinton administration has approved the export of U.S.-made super-computers and advanced aerospace manufacturing equipment to China and Russia. The Russians and Chinese diverted some of these advanced systems into their militaries. For example, in 1995 a U.S. built IBM supercomputer was sold to Russia under the pretense of conducting groundwater research. The $7 million computer actually was shipped to a Russian nuclear-weapons facility.

To prevent such transfers of dual-use technology, Congress, led by House National Security Committee Chairman Floyd D. Spence of South Carolina, in 1997 passed new regulations on the export of supercomputers which required U.S. officials to verify, through inspection, the sale and use of any advanced U.S. computers to some 50 countries.

Spence recently wrote an additional letter to his House colleagues, warning that the Clinton administration was trying to soften the new export controls. "Of great concern was the Administration's 1995 decision to loosen export regulations on super-computers (high-performance computers)," wrote Spence in his letter of April 21. "As a result of these loosened regulations, a number of U.S.-built supercomputers were sent to nuclear-weapons laboratories in Russia, as well as China and other countries of proliferation concern. Congress last year closed many of the loopholes in the president's export-control policy. However, recent news reports indicate that the administration may use the findings of an impending Stanford University report to justify a further weakening of export controls of supercomputers."

Commerce officials DeBusk and Majak in their letter reminded the Chinese government of a 1983 U.S.-Sino trade agreement that: "From time to time, establishing the bona fides of potential consignees may require commercial inquiries in the form of pre-license checks by the United States Foreign Commercial Service."

Yet, despite the 1983 agreement, U.S. officials were denied access for the inspection. DeBusk and Majak sought comments from the Chinese on where the process broke down and how U.S. officials could avoid this in the future.

DeBusk and Majak also notified the Chinese government of the new requirements that U.S. representatives do a postexport follow-up inspection. The requirements are supposed to give U.S. officials the legal leverage needed to verify that the exported super-computers have not been diverted to military uses. President Reagan was fond of quoting a Russian proverb whenever the topic of nuclear arms reduction came up: "Trust but verify." The renewed export of advanced U.S.- built supercomputers to China without verification that these computers will not be used for military purposes poses a significant threat to our national security. It may be argued that Bill Clinton's nuclear policy is not a policy out of control but a policy of no control. We are in the dangerous position of trusting without verification.

Charles Smith is the president of Softwar, a computer-security firm in Richmond, Va., and writes frequently on issues of national security.


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