The Cox Report
The declassified version of the Cox Report (or just the Cox Report in what follows) released on May 25, 1999, created a sensation. An editorial in the Washington Post caught the mood that day: it quoted Cox as saying that “[n]o other country has succeeded in stealing so much from the United States,” with serious and ongoing damage to the country.18 The Republican House majority leader Dick Armey said, “It’s very scary, and basically what it says is the Chinese now have the capability of threatening us with our own nuclear technology.”19 The ensuing sense of urgency led to calls for a transformation in the legal and administrative structure of international cooperation. Tighter controls on hardware and knowledge flows were imperative.
The Cox Report was a three-volume, 872-page glossy publication filled with photographs suitably labeled and a punchy overview that used color and other techniques to highlight key findings and to have them spring to the eye.20 Though most of the committee’s time was devoted to the Hughes and Loral cases, in the latter stages of its hearings it branched out into the “theft” of other sensitive technologies, notably for nuclear warhead design. Volume 1 of the report focused on this domain and on the diversion of High Performance Computers (600 of which had been sold to the PRC) from civilian to nuclear weapons applications. Volume 2 was devoted to the contacts between engineers at Hughes and Loral and their Chinese counterparts, particularly after the launch failures. It also had a section devoted to launch-site security in the PRC or, rather, the lack thereof. The short technological core of the third volume dealt with the efforts made by the PRC to improve their manufacturing processes by acquiring machine tool and jet engine technologies.
The report claimed that the PRC had “stolen design information on the United States’ most advanced thermonuclear weapons,” including the neutron bomb, from the four major weapons labs (Los Alamos, Lawrence Livermore, Oak Ridge, and Sandia).21 This would give China design information on such devices “on a par with our own,” and would materially assist the country “in building its next generation of mobile ICBMs, which may be tested this year,” with “a significant effect on the regional balance of power.” China had also “stolen or illegally obtained U. S. missile and space technology that improves the PRC’s military and intelligence capabilities.” The information passed by US satellite manufacturers to their Chinese clients—without obtaining the requisite licenses, even though they knew they were needed—had “improved the reliability of PRC rockets useful for civilian and military purposes,” including ballistic missiles. These security lapses were compounded by poor security at launch pads and by the liberal sharing of technical information with foreign brokers and underwriters of satellite insurance. The knowledge thus acquired would not only strengthen China’s military capability, but the PRC was also “one of the leading proliferators of complete ballistic missile systems and missile components in the world,” and had helped improve weapons programs in Iran, Pakistan, Saudi Arabia, and North Korea.
Two factors had facilitated these major breaches in the security wall. First, there were recent changes in international and domestic export control regimes that had reduced the ability to control the flow of militarily useful technology.
Supplementing this, there was China’s determination to obtain advanced US military technology, which it had actively sought for at least the past two decades. As the report put it, “To acquire U. S. technology the PRC uses a variety of techniques, including espionage, controlled commercial entities, and a network of individuals and organizations that engage in a vast array of contacts with scientists, business people, and academics.” In short, the Cox Report emphasized, “The PRC has mounted a widespread effort to obtain U. S. military technologies by any means—legal or illegal.”
As regards space policy, the Cox Report urged the executive branch to “aggressively implement the Satellite Export Control Provisions”22 of the Strom Thurmond Act. It demanded that the State Department be responsible for licensing the export of satellites and any satellite launch failure investigations. The Department of Defense, not satellite firms, was to be responsible for security at foreign launch sites, and had to establish appropriate monitoring procedures to ensure that no information of use to its missile programs was passed to the PRC. The report also insisted that “export controls are applied in full to communications among satellite manufacturers, purchasers, and the insurance industry, including communications after launch failures.”23 Recognizing that the American firms were seeking launch providers abroad because the United States had insufficient domestic launch capability (itself a result of the decision to cut back the production of expendable launchers so as to secure a market for the shuttle), the Select Committee also recommended that steps be taken to stimulate the nation’s “commercial space-launch capacity and competition.”24
The Cox Report proved highly controversial. Joseph Cirincione, the director of the Carnegie Non-Proliferation Project, objected that the report had “taken a real problem and hyper-inflated it for political purposes.”25 The Center for International Security at Stanford University asked four experts (Alastair Iain Johnston, W. K. H. Panofsky, Marco di Capua, and Lewis R. Franklin) to review the report from different angles. Throughout their critique the authors stressed that the analysis was marred by “imprecise writing, sloppy research, and ill-informed speculation,” as Johnston put it.26 In a vigorous riposte Nicholas Rostow, a staff director on the US Senate Select Committee on Intelligence, in turn identified what he called “50 Factual Errors in the Four Essays” that comprised the “Panofsky” critique.27 And toward the end of 1999 the National Academies’ Committee on Balancing Scientific Openness and National Security published its findings on the risks posed by foreign interactions with the national weapons laboratories.28
None of the critics denied that the Cox Report had put its finger on a serious issue. But they objected that it had incorrectly elevated security leaks to a privileged position in its analysis of knowledge flows between the United States and China: there were many other ways for PRC scientists and engineers to access the cutting edge of the American research system. They felt that it had incorrectly assessed China’s strategic goals, and the urgency with which it sought to update its obsolete nuclear and missile programs.29 Third, they contended that the combination of these two erroneous convictions had created a climate of crisis in which blanket restrictions on international exchange were being called for. This would be counterproductive and do the United States more harm than good. Tighter controls were thus not the answer to improved security: rather, what was needed was increased funding for R & D, which ensured that the United States always had the technological edge over its rivals. The Committee on Balancing Scientific Openness and National Security took a similar line, “The world is awash in scientific discoveries and technological innovations,” it wrote. “If the United States is to remain the world’s technological leader, it must remain deeply engaged in international dialogue, despite the possibility of the illicit loss of information.”30
This is the background against which the demand for a more rigorous application of export control regulations was specifically written into Public Law 106-391, NASA’s Authorization Act of2000 that was passed by both the House and the Senate. This act encouraged international cooperation in space exploration and scientific activities when it served American interests, and was “carried out in manner consistent with United States export control laws” (Sect 2.6 (B) (iii)). The point on regulation was picked up again later in a section of the act that twinned international cooperation with American competitiveness. After laying down specific recommendations as regards space cooperation with the PRC, the text went on to stipulate (Sect. 126 (3)) that NASA’s inspector general, in consultation with the appropriate agencies of the U. S. government,
shall conduct an annual audit of the policies and procedures of the National Aeronautics and Space Administration with respect to the export of technologies and the transfer of scientific and technical information, to assess the extent to which [the NASA] is carrying out its activities in compliance with Federal export control laws and with paragraph (2) [relating to the PRC].31
NASA had already institutionalized more formalized and systematic procedures for the implementation of export controls in the mid-1990s. P. L. 106-391, however, sent a strong signal that Congress was keeping an eye on the agency to ensure that compliance with ITAR was enforced. The effects have been felt throughout the centers, by NASA contractors such as JPL and by the agency’s international partners.
To summarize. The combined effect of the Strom Thurmond Act, the Cox Report, and P. L.106-391 has been to move export controls in the space sector to the very foreground of NASA and the State Department’s activities in the international domain. To be sure it was already evident in the mid-1990s that NASA’s management of export control needed to be tightened up. The ambiguity over whether or not ITAR or EAR applied to a space-related item was amplified by an internal organization that was fragmented, with different sections dealing more or less independently with the different regulatory systems. A single export control office replaced these in 1994/95. Its importance was fueled by fears that the PRC was gaining ready access to sensitive American defense-related technology. These were generalized by Congress, and embodied in legislation that demanded that NASA and US entities take the restrictions imposed by the ITAR seriously not only in dealings with the PRC but also with traditional allies and partners (subject to some variation for NATO members, for example).
Over the next decade the effects of these restrictions were increasingly felt and resented by NASA’s partners, as well by its contractors and US business. For example, John Schumacher, an associate administrator for external relations at NASA who moved into the aerospace industry in the 1990s, stressed the difficulty of deciding if an innovative technology fell under the ITAR or not. Taking the hypothetical example of a nano-ceramic coating for engine blades he noted that neither the firm nor the regulatory authority was sure whether something like this it fell under the ITAR or not. This was particularly frustrating for smaller companies with international clients, like his own, and often led them to “walk back from the edge,” and withdraw from regulation-prone innovative research.
NASA contractors such as JPL are also subject to the ITAR, and have established their own in-house ITAR office to ensure compliance, and need to establish Technical Assistance Agreements (TAA) before they can provide defense services to their partners. A TAA is a contract between the parties involved in the technology transfer. It references the ITAR, and defines items such as the roles of the contracting parties, what technology and services are covered, who can access the ITAR-controlled technology, restrictions or exemptions on how the technology can be used, and how long a foreign entity can have access to the technology. Even with these procedures in place there can be friction. Robert Mitchell, a project manager on the Cassini-Huygens mission (see chapter 2 ) , explains:
[T]he most common thing that comes up now is a problem with an instrument, a European-provided instrument. An example would be the magnetometer, which was provided by and still funded and operated by an organization in the U. K. The magnetometer will from time to time have issues in terms of how it interfaces with the onboard main central processor on the Cassini spacecraft, and there frequently are questions about whether the problem is in our computer, or a problem in the interface, or a problem in the instrument. And of those three things, we understand the first two far better than they do, and we understand the third probably not as well as they do, but we know it pretty well. . . Now, for us to give them technical assistance in resolving the problem is clearly prohibited except in the presence of a TAA, and even with that we’ve been cautioned to tread carefully. So when they have a problem— and about once a year they do—we work with them, we get it taken care of, but everybody is very conscious of this issue.32
Charles Elachi, the current director of JPL, sees the effect on interpersonal relationships with colleagues abroad as one of the most distressing feature of the ITAR. It undermines the freewheeling climate of mutual trust and respect that is essential to the success of an international project. As he said in an interview in June 2009:
[T]he bigger impact, in my point of view, was more on the interaction between people, more than actually getting a piece of hardware, because now if we want to talk with the ESA, we have to be careful what we talk about and so on. It’s not an issue of do we send a transistor from the U. S. to Europe, even if that’s a factor. But it’s really the interaction, and, I’m guessing that’s where maybe people like us are unhappy, and that’s where I’m unhappy also about
this thing, because the strength was in building trust and good relationship and exchange of ideas, and that kind of put a limitation on doing that.33
David Southwood, ESA’s then director of science and robotic exploration, was blunter in an interview in 2009: “Those of us who want to cooperate with the United States are frustrated by the level of regulation and nonsense we’re put through, and indeed the problem we face of trying to explain to people that if we really are cooperating we have to have an understanding of what something does in the partner’s piece of equipment.”34
There can be no doubt that the current (August 2012) ITAR regime is transforming the dynamics of international collaboration with the United States. It is not doing so simply by placing tight constraints on the hardware that can be shared with partners: as this book has made evident, in the domain of satellites and launchers, the components that can be acquired by others has always been subject to close scrutiny. By reaching deep into the daily workings of even nonmilitary cooperation involving scientists and engineers in academia, government laboratories and industry, the regime is making international collaboration more onerous bureaucratically and more risky institutionally, as well as undermining the trust and mutual respect between people that is so essential to the success of any joint project.
It must be stressed that NASA itself is not as tightly bound by ITAR as is a contractor like JPL. Like its contractors it requires a hardware license to export technology, but unlike them it does not require a TAA to supply defense services to foreign partners once an international agreement is in place (that agreement serves as the TAA).35 The agency has also been engaged for over a decade in discussions with the State Department on ways to improve the implementation of the ITAR, particularly as regards the need for TAAs by its contractors. At the time of writing extensive interagency discussions have also led to major proposals for export control reform. They are guided by the philosophy that the United States must focus limited resources on the threats that matter most, and put in place streamlined procedures, combined with effective safeguards, to control sensitive items appropriately. It is proposed that commercial satellites be put back on the EAR and be regulated by the Department of Commerce. On one issue there is no reform foreseen: export control policies with respect to the PRC and embargoed countries, like Iran.36