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2
Evidence on the Technology
Transfer Problem
INTRODUCTION
The Intelligence Community plays a particularly significant role in
decision making on national security export controls. This chapter ad-
dresses what is known about technology acquisition efforts in the West by
the Soviet Union, contributions to Soviet technological advancement
(including military systems), the state of Soviet science and technology,
and implications for national security export control policy.
No less than in other areas of intelligence, data on these matters are
incomplete and fragmentary. For example, evidence provided by the few
cases uncovered to date of espionage and diversion of militarily signifi-
cant technology in all likelihood offers only a limited-and perhaps not
fully representative indication of the overall volume of such activities.
Moreover, because intelligence often becomes available relatively late in
the development of national security export control policy, it is not yet
possible to assess the impact of the changes in national security export
controls that have been undertaken during the past few years. Nonethe-
less, despite the need for judgment and intuition to bridge information
gaps, the data do provide a backdrop for assessing the need for and
effectiveness of national security export controls.
*The Intelligence Community is a collective term denoting the director of central
intelligence and the U.S. intelligence agencies.
40
OCR for page 41
EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 41
INTELLIGENCE EVIDENCE ON SOVIET TECHNOLOGY
ACQUISITION
Intelligence information reviewed by the panel confirms previous
reports that the Soviet technology acquisition effort is massive, well
financed, and frequently effective. Western technology has flowed to
Warsaw Pact countries in recent years through three primary channels:
· espionage theft of classified information and/or items of direct
relevance to military systems;
· diversion shipment of militarily significant dual use products and
technology to unapproved end users, either directly through the export of
controlled products without a license (i.e., smuggling), or indirectly
through transshipment using a complex chain of increasingly untraceable
reexports; and
· legal sales-direct trade with the Soviet bloc, usually after receipt of
a license, that also includes some reexports (i.e., the legal transshipment
of products or components by firms operating in countries that do not
impose controls).
The need for vigilance against unwanted transfer of Western technol-
ogy was underscored by the so-called "Farewell affair," which occurred
in France in 1981.2 Farewell was the codename for an officer of the Soviet
Union's Committee for State Security (KGB) stationed in Paris during the
1960s. In 1981 this officer gave the West detailed information on the plans,
organization, and financing of Soviet efforts to target and acquire Western
high-technology equipment, blueprints, research and development data,
and so on. Farewell provided an extraordinary opportunity to assess the
effectiveness of the Soviet acquisition of Western technology as it is
perceived by the Soviets themselves-extraordinary because information
on Soviet intentions usually has been episodic and of insufficient quality
or quantity to allow accurate assessments of the Soviet acquisition
program. Although the panel recognizes that internal Soviet documents
such as the Farewell papers must be viewed with caution (because of the
possibility that the authors had an interest in inflating the successes of the
acquisition program in their reports to superiors), the Farewell papers do
set out a remarkable record of the scope and success of the Soviet
acquisition effort. (The information contained in the Farewell papers,
which contributes significantly to our current state of knowledge, was
documented in the unclassified white paper Soviet Acquisition of Militar-
ily Significant Western Technology: An Update, made public by the
Department of Defense in 1985.)
The Farewell papers indicate that, during the Tenth Five-Year Plan
(1976-1980), the Soviet acquisition program satisfied more than 3,500
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42 BALANCING THE NATIONAL INTEREST
specific collection requirements for hardware and documents for the 12
Soviet industrial ministries. Of the items acquired in the West, the Soviets
estimated that approximately 70 percent were subject to national security
export controls. This proportion was apparently much the same during
the most recent 5-year plan (1981-1985) as it was during the previous 5
years (1976-1980), a period of relatively less restrictive Western controls.
Moreover, the Soviet Union has established an elaborate administra-
tive structure, involving tens of thousands of people, to satisfy its
collection objectives. An outline of the Soviet institutional framework
was published in 1983 by Henri Regnard, a pseudonym used by a senior
French counterintelligence official.3 Regnard describes a bureaucracy
composed of the Military-Industrial Commission (VPK), Chief Director-
ate of Military Intelligence (GRU), State Committee for Science and
Technology (GKNT), the KGB, and the Ministry of Defense.4 This
structure administers the three main arms of the Soviet technology
acquisition effort: espionage, diversions, and legal sales.
ESPIONAGE
In the discussion of illegal channels of transfer, it is important to make
a sharp distinction between espionage and diversions. Espionage is covert
activity to obtain classified information about products and technologies
pertinent to military systems. Diversions, on the other hand, are illegal
shipments of unclassified dual use items or unclassified military goods to
unapproved end users. Diversion activity may occur at any stage of the
export process: It includes fraud in prelicense or postlicense documenta-
tion, theft during transshipment, and unauthorized postshipment reex
port.
There is little doubt that Soviet attempts to obtain equipment and
technology in the West by means of espionage are extensive, particularly
in light of the quite damaging instances of Soviet success revealed by
recent Western counterintelligence efforts (e.g., the Walker espionage
case). Indeed, it appears that many of the most significant losses to the
Soviet bloc (e.g., look-down/shoot-down radar) were achieved through
espionage, which is not effectively countered by export controls and thus
was not a subject examined in detail by the panel. Espionage does,
however, place limits on the effectiveness of any export control system.
DIVERSIONS
As noted above, diversions are illegal shipments of unclassified com-
modities and technical data to unapproved end users. Diversion activities
are often difficult to detect, in part because they may occur at many stages
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EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 43
of the export process and in part because the Soviets have devised
sophisticated, multinational diversion mechanisms that frequently escape
the attention of counterintelligence services of the countries in which the
diversion is taking place. The Export Administration Amendments Act of
1985 gives the U.S. Customs Service primary responsibility for foreign
investigation of all commercial export control violations including illegal
diversions. In the diversion investigation process, the U.S. Customs
Service receives information from all relevant government agencies, and
the Intelligence Community assists in verifying charges. The U.S. gov-
ernment also seeks the cooperation of the governments of countries in
which it suspects diversions are occurring. It is worth emphasizing that
many-perhaps most-diversions occur outside the United States and
often involve goods and technology originating in other technologically
advanced countries.
The Intelligence Community has developed significant information on
attempts by the Soviet Union and its allies to divert exports of Western
high-technology equipment. Two recent examples of diversion activity
help to illustrate the potential for the illegal flow of militarily useful
technology to the Soviet Union.
· In July 1986 the U.S. government uncovered a diversion of a large
shipment of computers and related sensitive equipment. (The shipment's
estimated value was in the tens of millions of dollars.) The equipment,
which is believed to have been destined ultimately for the Soviet Union,
had been routed first to Belgium and then to a Turkish buyer in Austria
where it was seized. (At the time of seizure, investigators report that
some components already had been delivered to the Soviet Union.) Some
of the products came from a U.S. company specializing in oscilloscopes,
spectrum analyzers, and other scientific measuring instruments. Report-
edly, acquisition by the Soviets of the U.S. equipment could enhance
their electronic intelligence capabilities. As of January 1987 the investi-
gation was still proceeding.
· Richard Mueller, a West German citizen, is still wanted today in that
country and in the United States for a number of cases involving illegal
exports to the Soviet Union of CoCom-controlled computers, microelec-
tronics, and other products. Mueller's involvement with illegal technol-
ogy acquisition on behalf of the Soviet bloc dates back to the early 1970s.
For his network, he established numerous "dummy" and "front" firms to
purchase products and technology; at one point, he reportedly had more
than 75 firms operating in Western Europe and the United States.
Between 1978 and 1983, Mueller used these firms to deliver to the Soviets
advanced computers, peripherals, and microelectronics manufacturing
equipment worth many millions of dollars.
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44 BA LANCING THE NATIONAL INTEREST
Perhaps Mueller's best-known operation was his attempt to divert to
the Soviet Union in late 1983 seven large VAX computers (and related
hardware and software) manufactured by the Digital Equipment Corpo-
ration. The VAX series of super minicomputers is valuable to the Soviets
because of their computer-aided design applications for microelectronics
fabrication. Mueller's front firms in South Africa and West Germany had
purchased this equipment in the United States for eventual transshipment
to the Soviets. Although much of it was seized by Swedish and West
German authorities when the diversion was uncovered in 1983, some of
the equipment is known to have been received in the Soviet Union.
There is no doubt that many diversions evade detection. Moreover, the
level and effectiveness of customs enforcement efforts to prevent diver-
sions differ, both within CoCom and among other technologically ad-
vanced Free World countries. There often is little likelihood that customs
inspectors will identify violations once goods have left the original shipper
and have been manipulated by experienced diverters because the volume
of trade is great, the- number of inspectors is comparatively small, and the
detection of mislabeled equipment requires sophisticated technical skills.
Identifying diversions is especially problematic while goods are in transit
through the bonded or customs-free zones maintained in most countries.
Although there is informal international cooperation among customs
officials to detect and prevent the diversion of goods in transit, these
officials are reluctant to enter such zones and open bonded shipments
without strong evidence of wrongdoing.
In light of these facts, perhaps the most important means for reducing
diversions arises from government cooperation with the private sector.
U.S. businessmen- and businessmen in firms abroad are in a position to
see inconsistencies in an individual's or company's behavior or the
appearance of a suspicious new company that does not fit with their
knowledge of the specific commercial context. Government officials for
their part can promote a stronger sense of responsibility for reporting
such circumstances by requesting information from the private sector.
These requests, when presented appropriately, often produce useful
cooperation including leads on possible diversionary activities. In gen-
eral, however, government agencies have failed to alert private industry
to the importance of this information and have not encouraged feedback.
LEGAL SALES
Some significant technology may be acquired by the Soviet bloc
through legal purchases when foreign availability of the given technology
exists. (The issue of foreign availability is discussed further in Chapter 5.)
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EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 45
For example, in light of the dispersion of sophisticated technology
throughout the world, the Soviet Union and other Warsaw Pact countries
have been (or may be) able to obtain controlled technology in Free World
countries that do not participate in the national security export control
regime established by CoCom. These countries could include both the
industrialized neutral countries of Europe and many newly industrializing
countries such as India, Singapore, and Brazil. Many of these non-
CoCom countries either do not acknowledge or do not enforce restric-
tions on the reexport of goods and technology obtained originally in
CoCom countries. Moreover, many are striving to or have already
become sources of indigenous high technology. Thus, there is an increas-
ing likelihood that the Soviet bloc may be able to purchase certain
categories of dual use technology (particularly at the lower end of the
CoCom-designated threshold*) in some of the more advanced non-
CoCom countries without ever having to resort to the use of covert
methods.
THE SIGNIFICANCE OF VARIOUS CHANNELS OF LOSS
Based on the evidence reviewed by the panel, it appears that espionage
is the most significant of the channels for technology loss. But as noted
earlier, export controls do not represent an effective means to deter
much less prevent espionage. Therefore, although the success of the
Soviet espionage effort serves to reveal Soviet intent, it cannot be used to
justify the change in export controls on dual use products. Indeed, an
assessment of the policy significance of the Soviet bloc's collection
activities, which requires examining the various channels for loss, would
be improved by greater discrimination on the part of the Intelligence
Community in categorizing different types of Soviet collection activities
as espionage, diversion, or open acquisition.
SOVIET UTILIZATION OF ACQUIRED WESTERN TECHNOLOGY
It is only on rare occasions that the Intelligence Community can declare
with relative certainty that the application of Western dual use technology
has contributed substantially to Soviet military developments.t The
*This includes the least-sensitive CoCom-controlled products and technologies (e.g.,
administrative exception note [AEN] 9/national discretion note items and AEN 12/favorable
consideration note items). See Chapter 4 for an explanation of these provisions.
tThis discussion deals with recent Soviet utilization of acquired Western technology. It
is well known that the Soviets acquired European weapons technology as well as scientific
knowledge and technical personnel at the end of World War II.
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46 BALANCING THE NATIONAL INTEREST
necessarily fragmentary data used for these assessments most often seem
to deal with the introduction of process equipment into manufacturing
plants. There are also isolated examples of specific Western components,
or copies of them, appearing in Soviet military equipment.
One of the few recent instances in which solid evidence on Soviet
technology acquisition was uncovered involved data from the Soviet
Military-Industrial Commission (VPK). The VPK produces an annual
report based on an evaluation of individual Soviet defense manufacturing
ministries whose strategic technology needs have been satisfied through
technology acquisition efforts in the West. It includes aggregate statistics
on the number of technical documents and samples (hardware) obtained,
gross ruble savings, and the number and priority of satisfied require-
ments. Data from one of these reports (as noted earlier in this chapter)
indicate that, during the Tenth Five-Year Plan (1976-1980), more than
3,500 requirements or 50 percent of the total were reported as fully
satisfied worldwide. Roughly 60 to 70 percent of these were fulfilled by
the Soviet intelligence services (KGB and GRU) and their surrogates
among the Eastern European intelligence services. Furthermore, the
VPK projected that, during the Eleventh Five-Year Plan, the number of
fully satisfied requirements will exceed 5,000.5
The report also states that from 1976 to 1980 the Ministry of Defense
Industry (armor and electro-optics) and the Ministry of Aviation Industry
realized the greatest savings in research project costs. By the Soviets'
own calculations, these savings equalled $800 million (in 1980 purchasing
power equivalents) worth of comparable research activity. The equivalent
Soviet manpower cost of these savings alone translates roughly into over
100,000 man-years of scientific research. These data on savings, however,
may be conservative: The ruble figures probably reflect operating costs
(e.g., salaries, elimination of test range activity) and exclude capital
costs.6
Given such uncertainties about available data on Soviet costs and
savings, the United States has had no persuasive analysis of either the
value of Western technology acquisitions to the Soviet R&D process or
the ruble expenditures avoided through such efforts. To supply such an
analysis, the Department of Defense commissioned a study to estimate
both the ruble savings to the Soviets for R&D expenditures foregone and
the additional cost to the West to counter new Soviet military capabilities
(discussed further in Chapter S); the report of this study, Assessing the
Effect of Technology Transfer on U.S./Western Security A Defense
Perspective, was published in 1985. Although the Defense Department
report has been regarded generally as a useful first step, the panel and
other experts it consulted have found the methodology employed and the
conclusions reached to be unconvincing.
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EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 47
Part of the difficulty in assessment arises from the inevitable problems
in putting a product or technology into effective use. The Soviets may
attempt to reverse-engineer a product that is, use an item obtained in the
West as a basis for producing the technology themselves for military
systems. The panel believes that this strategy is generally unproductive
for many types of items (such as high-density semiconductor devices)
because often the ability to copy a technology depends more on techno-
logical infrastructure and the capability of the manufacturing process than
on the observable features of a particular device. Indeed, the experience
of U.S. firms in setting up manufacturing facilities in foreign subsidiaries
indicates that great care and considerable time are required to duplicate a
product successfully at least in terms of quantity-even with full access
to all manufacturing process details and equipment. This fact suggests
that a loss through the diversion of a few units of most products is unlikely
to have much military significance. Of course, in some cases the Soviets
can gain insight into the function of a particular component through
reverse engineering, which may aid them in the development of counter-
measures or give them confidence that a specific design approach has
been successful in the West. But this situation is likely to have signifi-
cance only with regard to uniquely military items rather than with the dual
use products that are the focus of this report.
Nevertheless, there are certain key items of process control or manu-
facturing hardware (so-called keystone equipment) that can provide the
Soviets with substantial leverage even if only a few are obtained because
they facilitate the production of quantities of other hardware. (Precision
ballbearing grinders, which the Soviets acquired legally in the past, have
been cited as an example of such equipment.) By the standards of Western
productivity the Soviets are generally weak in automated manufacturing
techniques. Consequently, a prevalent judgment in the United States, at
least since the 1976 Bucy report, has been that the emphasis of national
security export control policy should be on constraining the flow of essential
technologies and manufacturing equipment incorporated in some turnkey
plants rather than on the end products of the manufacturing process.
Table 2-1 is one of a number of estimates published by the Department
of Defense (DoD) that compare the state of the art of Soviet technology
with that of the United States. Although in some cases different conclu-
sions may be drawn, the panel has determined that for most types of dual
use technology the Soviet Union is on average approximately 5 to 10
years behind the West and does not appear to be closing the gap.
Despite an extensive acquisition effort, then, the Soviets in general
have not succeeded in reducing the West's technology lead. Some of the
reasons for this state of affairs are discussed in the next section of this
chapter. It should be noted, however, that the situation is different for
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48 BALANCING THE NATIONAL INTEREST
TABLE 2-1 Relative U.S. Versus USSR Standing in 20 Militarily
Related Technology Areas
Basic Technologies
USSR
Superior
U.S./USSR U.S.
Equal Superior
Aerodynam~cs/fluid dynamics
Computers and software
Conventional warheads (including all
chemical explosives)
Directed energy (laser)
Electro-optical sensor (including infrared)
Guidance and navigation
Life sciences (human factors/biotechnology)
Materials (lightweight, high strength, and
high temperature)
Micro-electronic materials and
integrated-circuit manufacturing
Nuclear warheads
Optics
Power sources (mobile includes energy
storage)
Production/manufacturing (includes
automated control)
Propulsion (aerospace and ground vehicles)
Radar sensor
Robotics and machine intelligence
Signal processing
Signature reduction
Submarine detection
Telecommunications (including fiber optics)
X
X
X
X
X
X
X
X
X
X
~ X
X
X
X
~ X
X
X
X
AX
X
NOTE: This list is in alphabetical order. Relative comparisons of technology levels depict
overall average standing only; countries may be superior, equal, or inferior in subcategories
of a given technology. Arrows indicate that relative technology levels are changing
significantly in the direction shown.
SOURCE: The FY1987 DoD Program for Research and Development (Statement by the
Under Secretary of Defense, Research, and Engineering to the 99th Congress, Second
Session, 1986).
fielded military systems. Although the West generally remains ahead in
the most advanced weapon systems, the strong Soviet emphasis on the
development and production of military hardware has resulted in many
items or equipment in the field that in many weapon system categories
often are as modern as those deployed in the West. Assessing the
significance of this fact for export controls is difficult, however; often, the
technology in Western military hardware lags behind what is widely
available in the commercial sector.7
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EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 49
In sum the Soviets generally continue to lag behind the West techno-
logically although they have worked for years to close this gap, in part by
obtaining new technology from the West. Instead of advancing the overall
state of Soviet technological development, however, this practice, in
tandem with problems inherent in the structure of Soviet science and
technology, may have resulted in maintaining or perhaps even widening
their lag due to dependence on generally outdated Western equipment and
technology (particularly in the field of computer science). Although it
would be foolhardy for the United States and the other technologically
advanced countries of the West to facilitate Soviet access to militarily
critical technology, the panel considers it unlikely that an influx of
Western technology will enable the Soviet Union to reduce the current
gap substantially as long as the West continues its own rapid pace of
innovation.
THE STATE OF SOVIET SCIENCE AND TECHNOLOGY8
It has long been known that the organizational structure and rigidities of
Soviet science have a strong impact on both the effectiveness and
efficiency with which the results of scientific research are transferred into
technical application in the Soviet Union and on the assimilation of
technical innovations acquired from the West. Soviet science and indus-
try are characterized by:
· an incentive system that does not strongly support technical innova-
tion and implementation;
· research activity that is highly concentrated, both organizationally
and geographically;
· rigidly hierarchical lines of authority and communication;
· subjugation to political factors (i.e., party bureaucracy and military
priorities); and
· difficulty in incorporating new scientific ideas into a development and
production phase.
The restricted communications that derive from the Soviet penchant for
secrecy have resulted in the isolation of scientific entities within the
system. This in turn has caused reduced cooperation among scientists,
duplication of effort despite central planning, slow diffusion of new ideas
and technologies, and errors due to inadequate peer review. The severe
isolation of Soviet scientific institutes and laboratories from one an-
other, from the design bureaus that actually use the data they produce,
and from the West- and the separation of civilian and military research
efforts severely hinder the process of cross-fertilization that has acceler-
ated progress in science and technology in the West.
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50 BALANCING THE NATIONAL INTEREST
It is especially difficult for the Soviets to incorporate new scientific
ideas into development and production in the civilian sector. Formal
review and approval must take place through several levels of manage-
ment. Moreover, line managers often ignore ministry directives calling for
innovation because they fear the consequences~of not meeting short-term
quotas as specified in the current plan. Recently, additional changes
reportedly have been made to encourage risk-taking through the imple-
mentation of technical innovations; these changes allow production
quotas in the current plan to be reduced for a period of time following the
introduction of a new instrument or new process.9
Soviet defense projects consistently receive top priority in the alloca-
tion of resources to research and development. The military has priority
access to the best indigenous technology. It also has the power to
encourage innovation and accelerate production. The military's formida-
ble ability to obtain Western technical goods and information further
facilitates projects under its sponsorship. When Soviet military equip-
ment designers levy requirements for Western documents, blueprints,
and test equipment and other hardware, the VPK reportedly utilizes a
national fund of about half a billion rubles* to satisfy them.~°
The acquisition of particular documents can command funding as
considerable as that for hardware items. The Soviets reportedly spent
over 50,000 rubles for documents on the U.S. shuttle orbiter control
system; the same sum was committed to acquiring information on
high-energy laser developments. More than 200,000 rubles was approved
for acquiring selected research documents on U.S. antimissile defense
conceptS.ll
Besides substantial funding support, Soviet defense projects also
appear to command substantial human resources, including those avail-
able in the civilian sector. Although the Western Intelligence Community
can only estimate the percentage of Soviet civilian scientists involved in
military projects, some place the figure above 50 percent. Often, Soviet
scientists are recruited temporarily and agree to work for the military
simply to acquire access to choice equipment, which they then put to use
on their own nondefense-related projects.
A principal uncertainty with regard to the Soviet military's investment
in science is whether it could one day present the West with an
unexpected "Sputnik-like" surprise. The views expressed by U.S. sci-
entists, Soviet emigre scientists, Western scientists who have worked in
the Soviet Union, and Sovietologists, as well as those contained in
*The U.S. government calculated that for 1980 the approximate conversion ratio was 1
ruble = $1.47.
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EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 51
unclassified U.S. intelligence assessments, do not yield a consensus on
this question.
General-Secretary Mikhail Gorbachev has stressed the role of scientific
and technical progress in Soviet economic development. He has spoken
of plans to focus Soviet scientific efforts more on applications and less on
pure research aiming at the twin objectives of more rapid economic
growth and a stronger military and he has given priority to computer
science and education. Although the defects noted in Soviet science
continue to be fundamental to their system and will not be altered easily
or quickly, U.S. policy must be formulated in recognition of the possibil-
ity of significant change.
IMPLICATIONS OF INTELLIGENCE EVIDENCE
The preceding discussion of the evidence on technology transfer to the
Soviets yields a number of important implications for the formulation of
an appropriately designed national security export control regime. Among
the most significant are the following:
1. In the judgment of senior Western intelligence officials, espionage is
the technology acquisition channel that is most valuable to the Soviets in
enhancing their military capability, followed (to a lesser extent) by
diversion of unclassified but controlled technology. Third in importance is
the acquisition of uncontrolled Western technology. The U.S. national
security export control regime does not provide solutions to the problem
of espionage.
2. Based on its review of Intelligence Community evidence, the panel
agrees that a legitimate need for appropriately designed export controls
continues to exist. However, the significance of export controls alone in
stemming losses should not be overestimated.
3. Because sources of products and technology increasingly exist
elsewhere in the world, and because most diversions involve activities in
other Western nations, the U.S. export control effort must be multina-
tional. (See Chapter 6.) Attempting to develop an extensive system of
controls centered in the United States appears futile in light of the fact
that significant losses continue to occur elsewhere. Reduction of "high-
end" diversion (i.e., diversion of the most sensitive CoCom-controlled
products and technologies) requires the cooperation of CoCom and other
non-CoCom Free World countries-cooperation that currently may not
exist and that may require substantial diplomatic and private sector
efforts to achieve. Nevertheless, improving the effectiveness of export
enforcement in the current regime can make a substantial difference with
respect to the control of unclassified dual use items.
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52 BALANCING THE NATIONAL INTEREST
4. Part of the U.S. concern about the Soviet technology acquisition
effort relates to the current status of alternative technology sources
around the world. Intelligence evidence indicates that U.S. dominance in
various technology areas generally is decreasing (see Chapter 31. The
diffusion of technology, the availability of controlled technology from
outside the CoCom countries, the impossibility of an absolute embargo on
any technology other than that contained in very high-cost items existing
in small quantities (e.g., supercomputers) are all factors that contribute to
U.S. policy formulation and that require reliable corroborating data.
The Intelligence Community and the Department of Defense have
endeavored to make intelligence information on Soviet technology acqui-
sition activity available to the public. For example, various "white
papers" have been issued by the Intelligence Community, an effort that is
especially valuable because public awareness may be a key to stemming
losses through espionage or diversion. There is a similar need for
improved dialogue between the U.S. R&D community (industry, acade-
mia, and government labs) and government officials charged with staying
abreast of important developments in science and technolog~particu-
larly those who must make export control decisions on the basis of their
understanding of the technologies involved and their knowledge of the
state of foreign science and technology capability. The utilization of
information derived from such a dialogue can be invaluable in determining
specific products or technologies that should be controlled or decon-
trolled and in promoting a better general understanding of the worldwide
state of the art in key technologies.
l
NOTES
1. U.S. Department of Defense, Soviet Acquisition of Militarily Significant Technology:
An Update (Intelligence Community white paper) (Washington, D.C., September 1985).
2. Thierry Wolton, Le KGB en France (Paris: Editions Grasset ~ Fasquelle, 1986).
3. Henri Regnard (pseudonym), "The U.S.S.R. and Scientific, Technological, and Tech-
nical Intelligence (English translation)," Defense Nationale (December 1983), pp.
107-121.
4. Regnard's statements are consistent with descriptions in the "Penkovsky papers" of
1965, which identified KGB participation in the foreign activities of GKNT. (Oleg
Penkovsky, The Penkovsky Papers [London: Collins, 1965]. This book is based on the
testimony of a Soviet double agent.) The white paper Soviet Acquisition of Militarily
Significant Western Technology: An Update provides extensive discussion of the key
Soviet organizations involved in the acquisition of Western technology.
5. U.S. Department of Defense, Soviet Acquisition, p. 60.
6. Ibid., p. 6.
7. This topic was thoroughly addressed in the recent Packard commission report, A Quest
for Excellence: Final Report to the President by the President's Blue Ribbon Commis-
sion on Defense Management (Washington, D.C., June 1986).
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EVIDENCE ON THE TECHNOLOGY TRANSFER PROBLEM 53
8. The data on which this section is based were drawn primarily from the 1985 report by
the Foreign Applied Sciences Assessment Center (FASAC) entitled Selected Aspects of
Soviet Applied Science. Coordinated by Science Applications International Corpora-
tion, FASAC has produced a number of studies at the request of the U.S. government
assessing the state of science and technology in the Soviet Union. The center has drawn
on the expertise of more than 100 U.S. scientists and engineers to evaluate available
Soviet literature in their fields and summarize the military, economic, and political
implications of recent developments in the Soviet Union. The principal focus of the
FASAC reports is on Soviet exploratory research, which seeks to translate develop-
ments in fundamental research into new forms of technology with important application
potential.
9. A Study of Soviet Science (Intelligence Community white paper) (Washington, D.C.,
December 1985), p. 10.
10. U.S. Department of Defense, Soviet Acquisition, p. 3.
11. Ibid., p. 4.
12. From a speech to the 27th Congress of the Communist Party of the Soviet Union, March
1986, reported by Gary Taubes and Glenn Garelik in '~Soviet Science: How Good Is
It?" Discover (August 1986), p. 57.
Representative terms from entire chapter:
export control
