Export Control Reform 2009: Enhancing National Security and Economic Competitiveness
About This Event

The U.S. export control system is a fifty-year-old piecemeal relic of the Cold War. The lengthy controlled products and technologies lists and the overly complex licensing systems often hamper U.S. high-tech business interests abroad and have only a limited ability to protect U.S. national security. In early August, the White Listen to Audio


Download Audio as MP3
House initiated a full scale review of the U.S. export control system. Congress has also been actively pursuing various export control reforms through statute. At this AEI event, think tank, government, and industry experts will offer their thoughts on how best to reform the export control system so that it can more effectively protect U.S. national security and economic interests.

Agenda
Event Contact Information
Michael Mazza
American Enterprise Institute
1150 Seventeenth St., NW
Washington, DC 20036
Phone: 202-862-6027
Media Contact Information
Veronique Rodman
American Enterprise Institute
1150 Seventeenth Street, N.W.
Washington, DC 20036
Phone: 202-862-4870
Event Summary

WASHINGTON, OCTOBER 5, 2009--Speaking at an AEI conference, Matthew Borman of the Commerce Department's Bureau of Industry and Security highlighted the primary reasoning behind and challenge to export control reform. Noting how the international environment has changed since the days of the Cold War when the U.S. export control system was designed, Borman explained that there is today a "much greater diffusion of threats from different types of countries [and] much more significant threats from nonstate actors and even individuals." Such actors and individuals "can do us . . . significant harm with a very low level of technology," which further complicates efforts to reform the export control system.

Even given the greater number and variety of threats to which the export control system must be responsive, panelists were optimistic about the prospects for success in reforming the system. Ed Rice, a senior professional staff member on the U.S. House Committee on Foreign Affairs, contended that "there is now a confluence of people in key positions--both on the Hill and in the executive branch and outside--that is now able to move export control legislation forward." Rice identified Secretary of Defense Bill Gates in particular as the driving force in the administration for export control reform.

Still, it is "a weedy, complex issue area, and it is also one on which people have very deep feelings" as Bill Reinsch, president of the National Foreign Trade Council, pointed out.

Speaking on defense trade controls, AEI resident fellow Thomas Donnelly reiterated Borman's concerns regarding the changed nature of the international environment. Due to the complex nature of the threats that the United States is facing, Donnelly argued, "we . . . have a hard time defining for ourselves what our strategy is, what we want to achieve." Donnelly went on to say that the greater diversification of threats requires the United States to rely more heavily on its allies and partners. "It is really critical for us to encourage our East Asian allies, Japan and Korea, to invest more in [high-technology capabilities] and to make it easier for them to acquire these technologies." The United States should also "build a defense trade partnership with India" and should cooperatively develop more weapon systems, as it did with the coming F-35 Joint Strike Fighter.

Foreign trade is crucial for the American defense industry. Richard Aboulafia, vice president of analysis at the Teal Group, explained that Department of Defense procurement and research and development spending are going down. With regard to procurement, Aboulafia said, "we're entering a post-growth universe." For defense firms, this means that the "only place for growth is with exports." Meanwhile, the U.S. defense industry's global market share has been shrinking relative to that of other nations' industries. In short, defense trade control reform is needed if the U.S. defense industry is to remain competitive.

View complete summary.

Speaker biographies

Richard Aboulafia is vice president of analysis at Teal Group. He manages consulting projects in the commercial and military aircraft field and analyzes broader defense and aerospace trends. He has advised numerous aerospace companies, including most prime and many second- and third-tier contractors in the U.S., Europe, and Asia. He also advises numerous financial institutions on aerospace market conditions. Mr. Aboulafia writes and edits Teal Group's World Military and Civil Aircraft Briefing, a forecasting tool covering over 135 aircraft programs and markets. He also writes publicly about aviation and defense, with numerous articles in Aviation Week & Space Technology, the Wall Street Journal, Financial Times, Professional Pilot, and other publications. He has a regular column in the American Institute of Aeronautics & Astronautics' (AIAA_) Aerospace America. Frequently cited as an aviation industry authority by trade and news publications, Mr. Aboulafia has also appeared on numerous television news and radio programs including ABC, BBC, Bloomberg, Reuters, CBS, CNN, NBC, NPR, and PBS. He has spoken at numerous conferences, including those of the Air transportation Reaserach International Forum (ATRIF), NAFA Fleet Management Association, National Aircraft Research Associatiation (NARA), Network for Aerospace Management in Europe (NAME), and SpeedNews. He presents a yearly lecture to the National Defense University's Industrial College of the Armed Forces and has served as an expert witness in aerospace markets. Before he joined Teal Group in 1990, Mr. Aboulafia analyzed the jet engine market at Jane's Information Group, served as an aerospace industry consultant for an international trade advisory company, and supported research projects at the Brookings Institution.

Marion C. Blakey is president and chief executive officer of the Aerospace Industries Association, where she has worked since 2007. Before that, she served a five-year term as administrator of the Federal Aviation Administration (FAA). As FAA administrator, Ms. Blakey regulated the nation's airways as well as operated the world's largest air traffic control system managing 44,000 employees and a $14 billion budget. Under her leadership, she launched NextGen − a satellite-based system that will modernize air transportation and decrease delays. Prior to being named FAA Administrator, Ms. Blakey served as chairman of the National Transportation Safety Board. Including her service at the FAA and NTSB, Ms. Blakey has held six presidential appointments, four of which required Senate confirmation. Ms. Blakey has also served as administrator of the Transportation Department's National Highway Traffic Safety Administration and  held key positions at the Department of Commerce, the Department of Education, the National Endowment for the Humanities, the White House, and the Department of Transportation. From 1993 to 2001, Ms. Blakey was the principal of Blakey & Associates, now Blakey & Agnew, a Washington, D.C. public affairs consulting firm with a particular focus on transportation issues and traffic safety.

Dan Blumenthal joined AEI in November 2004 as a resident fellow in Asian studies. He has served on the U.S.–China Economic and Security Review Commission since 2005, serving as vice chairman in 2007, and as a member of the Academic Advisory Board for the Congressional U.S.–China Working Group. Previously, Mr. Blumenthal was senior director for China, Taiwan, and Mongolia in the Office of the Secretary of Defense for International Security Affairs during the first George W. Bush administration. At AEI, Mr. Blumenthal focuses on Asian security issues. He has written articles and op-eds for the Washington Post, the Wall Street Journal, Newsweek, The Weekly Standard, National Review, and numerous edited volumes. He is currently working on a book that examines domestic influences on Chinese policymaking.

Matthew Borman currently serves as the deputy assistant secretary of commerce for export administration. In this position, Mr. Borman is responsible for implementing the Bureau of Industry and Security's (BIS) controls on the export of dual-use items for national security, foreign policy, nonproliferation, and short supply reasons. In addition, he oversees BIS's programs to ensure that industrial resources are available to meet national and economic security requirements, BIS's implementation of the Chemical Weapons Convention and the U.S. Additional Protocol. Prior to his appointment as deputy assistant secretary, Mr. Borman served as acting chief of the Enforcement and Litigation Division of the Office of Chief Counsel for Export Administration, where was responsible for providing legal advice to the export enforcement unit of BIS, including the adjudication of administrative enforcement actions. Mr. Borman entered the Commerce Department in 1992 as an attorney in the Office of Chief Counsel for Export Administration, where his responsibilities included attempts to revise the Export Administration Act; congressional, General Accounting Office and Office of Inspector General investigations and studies, Freedom of Information Act requests, and export control cooperation with other countries.

Thomas Donnelly is a resident fellow in defense and security policy studies and the director of the Center for Defense Studies at AEI. He is the author, with Frederick W. Kagan, of Ground Truth: The Future of U.S. Land Power (AEI Press, May 2008); the coeditor, with Gary J. Schmitt, of Of Men and Materiel: The Crisis in Military Resources (AEI Press, 2007); and the author of The Military We Need (AEI Press, 2005), Operation Iraqi Freedom: A Strategic Assessment (AEI Press, 2004), and several other books. From 1995 to 1999, he was policy group director and a professional staff member for the House Armed Services Committee. Mr. Donnelly also served as a member of the U.S.–China Economic and Security Review Commission. He is a former editor of Armed Forces Journal, Army Times, and Defense News.

Bill Reinsch currently serves as president of the National Foreign Trade Council (NFTC). The NFTC, founded in 1914, is the oldest and largest business association dedicated solely to trade policy, export finance, international tax, and human resource issues. The organization represents 300 companies through its offices in New York and Washington, D.C. As president, Reinsch oversees NFTC's efforts against unilateral sanctions, in favor of open markets, in support of Ex-Im Bank and OPIC, and in support of sound international tax policy, among many other international trade and tax issues of concern to U.S. business. Concurrently, Mr. Reinsch serves as a member of the U.S.–China Security Review Commission. Prior to joining the NFTC, Reinsch served as the under secretary for export administration in the U.S. Department of Commerce. In that position he administered and enforced the export control policies and anti-boycott laws of the U.S. government and monitored the condition of the nation's defense industrial base. Prior to taking this position, Mr. Reinsch spent twenty years on Capitol Hill from 1973 to 1993, most of them as senior legislative assistant to the late Sen. John Heinz and subsequently to Sen. John D. Rockefeller IV.

Edmund Rice is a senior professional staff member on the U.S. House Committee on Foreign Affairs, working for Chairman Howard Berman (D-CA). He has lead responsibility on the committee staff for the Export Administration Act, among other assignments. He has thirty-eight years of Washington experience, including nearly 20 years on Capitol Hill. From 1997–2009 he served as president of the Coalition for Employment Through Export (CEE), an organization that specializes in issues related to export finance, export controls and similar matters. From 1999–2009, he cochaired the Export Controls Working Group, comprised of some 200 specialists in export control policy, and from 2008–2009, he served as coordinator of the Coalition for Security and Competitiveness, which works to advance export control reforms. From 1990–1997, Mr. Rice served on the Foreign Affairs Committee staff, working on its Subcommittee on International Economic Policy and Trade. During 1995-1996 he was staff director of the subcommittee. From 1987–1990, he worked on House Banking Committee issues for Rep. Toby Roth (R-Wisc.), including staffing the Subcommittee on Oversight and Investigations. From 1976 to 1987, he worked for the American Hospital Association, including as vice president for Federal Relations, managing the association's Congressional and federal agency advocacy. From 1971 to 1976, he worked for Rep. Margaret Heckler (R-Mass.), including as chief of staff.

Neena Shenai joined AEI as an adjunct scholar in April 2009. She focuses on the intersection of U.S. international trade and national security policy. Previously, Ms. Shenai was a senior adviser in the Bureau of Industry and Security at the U.S. Department of Commerce. Before serving in the Bush administration, she was an attorney in the international trade group at Skadden, Arps, Slate, Meagher & Flom LLP. Ms. Shenai has also worked in the Rules Division at the World Trade Organization and was a law clerk for the Judge Evan J. Wallach at the U.S. Court of International Trade.

AEI Participants

 

Dan
Blumenthal
  • Dan Blumenthal is a current commissioner and former vice chairman of the U.S.-China Economic and Security Review Commission, where he directs efforts to monitor, investigate, and provide recommendations on the national security implications of the economic relationship between the two countries. Previously, he was senior director for China, Taiwan, and Mongolia in the Secretary of Defense's Office of International Security Affairs and practiced law in New York prior to his government service. At AEI, in addition to his work on the national security implications of U.S.-Sino relations, he coordinates the Tocqueville on China project, which examines the underlying civic culture of post-Mao China. Mr. Blumenthal also contributes to AEI's Asian Outlook series and is a research associate with the National Asia Research Program.
  • Phone: 202-862-5861
    Email: dblumenthal@aei.org
  • Assistant Info

    Name: Lara Crouch
    Phone: 202-862-7160
    Email: lara.crouch@aei.org

 

Thomas
Donnelly
AEI on Facebook