This document provides background information and summarizes the debate over export controls on computers. The links to the left will lead you to public documents that we have found.
The United States
has the world's most technologically advanced computer industry. American
firms produce a steady stream of new computer products with innovative features,
increased capacity, and faster processing speeds. The export of high end computers
is a lucrative market and companies in the industry are highly sensitive to
restrictions on foreign sales. The underlying problem is that the most powerful
computers have applications for the development of sophisticated weaponry,
including nuclear bombs and related delivery systems. There are many countries
in the world that the United States would prefer to be restrained in the types
of weapons they possess in their arsenals. Consequently, the government regulates
the sale of the most powerful computers to countries that are not strong allies.
An inherent difficulty
with export controls is that technology quickly outpaces policymaking. The
processing speed of the most powerful computers can leap forward by a significant
magnitude in the space of just six months. As industry representatives are
fond of telling legislators and regulators, "Yesterday's supercomputer
is today's laptop." The current regulatory scheme is centered around
speed, measured in MTOP's (or Million Theoretical Operations Per Second).
No sooner does the government set a new and higher MTOP standard, only below
which computers can be sold to countries whose defense capabilities concern
the United States (such as China), than new computers with higher speeds are
introduced. Although companies in the United States are in the forefront of
innovation, it doesn't take long for foreign competitors to match what the
American companies can produce.
The effort to
change the current regulatory structure, tied to the National Defense Appropriations
Act of 1997, has been spearheaded by two industry coalitions. The Computer
Coalition for Responsible Exports (CCRE) is composed largely of computer hardware
manufacturers like Apple, Dell, Intel, and IBM. The 30 members of the Information
Technology Industry Council come from a range of high tech companies, including
AOL Time Warner, Amazon.com, eBay, IBM, and Microsoft. Despite the impressive
roster of both these coalitions, and the active lobbying by them as well as
by individual firms and other trade associations, terminating export controls
on computers has turned out to be a tough sell.
The computer
coalitions and companies have pushed many arguments forward to try to convince
government officials to change this policy. One is that the kind of computers
that can truly be used for simulating advanced weapons are mostly custom-designed
and not available for export. Another is the lost revenue for computer companies.
Overseas markets represent a large proportion of revenue for most information
technology companies. Although only some of those sales are subject to government
review, regulatory restraints still represent significant dollars lost. Said
one industry lobbyist, "If [a foreign vendor buys] a high end computer
from an American as opposed to a European or Japanese manufacturer, they may
be subject to State Department reviews and, all in all, it's just a lot of
hassle for them to put up with. Why would they when they can buy from the
others?" Nevertheless, national security concerns make some lawmakers
hesitant, and it's been particularly difficult for the computer companies
to overcome opposition on the House Armed Services Committee.