WASHINGTON, DC, June 2, 1998 --  

The decision of the U.S. House of Representatives to outlaw the launch of American-built satellites in China is an outrageous blow to free markets and the high-tech economy. In seizing an opportunity to attack President Clinton, the Republican leadership has yet again lost site of an opportunity for reform in favor of entrenching the status quo.

At issue is the Clinton Administration's grant of an export restriction waver to Space Systems/Loral to launch one of its satellites in China. The Republicans smell blood in the dual scandal of 1996 Democratic campaign contributions from Loral and Chinese officials, as well as two-year-old allegations of "technology transfer." The allegedly illegal transfer of technology took place when Loral advised Chinese engineers on ways to improve flaws in its rocket for future launches of Loral spacecraft.

The scandal has therefore been framed as a case of Clinton compromising American security to get campaign contributions. While the Republican attack may be politically expedient, it is horribly regressive. The only possible outcome of this attack is new restrictions on business. Restricting global commerce for the sake of perceived national security may have made sense during the Cold War, but serves no useful purpose during peacetime. More importantly, such restrictions go against some of the most hopeful and promising developments of the last decade.

One of these fantastic post-Cold War changes has been in the application of technology. While the focus of most research and development used to be for military applications, commercial interests have seized the cutting edge with vigor. Nowhere is the impact of this change more striking than in the field of communications. The commercial World Wide Web now dwarfs the defense network from which it began. Private communications satellite launches now far outnumber launches of satellites for the military.

Commercialization of technology has been a key factor in expanding world trade. Governments keep military technology within national borders to enhance their security. Private companies do exactly the opposite. In order to advance their competitiveness, they seek to apply commercial technology wherever it best fits into the global marketplace -- national borders be damned.

For Space Systems/Loral, the proper place to apply launch vehicle technology is the Chinese space program. By contracting launches on Chinese Long March rockets instead of U.S. or European-based alternatives, Loral saves millions. Loral and the Chinese space program are business partners. When Chinese and American engineers work together to launch these satellites, exchanging information is a key part of doing their jobs. But the importance of technical communication means nothing to the enforcers of the government order. On-site-officials do everything they can to shut up American engineers and get in the way of any meaningful exchange. It is only in this outrageous environment that a "technology transfer" to Chinese engineers could be considered surprising, let alone scandalous.

It is time for government regulators to face a harsh reality: Laws restricting technology to national borders have become obsolete.

To the U.S. Government and its inward-looking citizens, this reality is a heresy. Maintaining the military secrecy of technology has been a key factor in governments' policies for over a century. Now that commercial technology reigns supreme, they fantasize that they can continue to control it as usual.

They can't.

While Congress may wish to return to a military-industrial complex under its control, technology has conspired against it. The rise of the global Internet and advances in encryption software make it impossible for the government to control ideas. Any technology that can be expressed on paper can easily be put into electronic form, encrypted, and transferred to any point on the globe without anybody being the wiser.

Like it or not, the age or American technology is over. In the future, all ideas and inventions will freely exist throughout the world.

Although the instruments necessary to cause these changes already exist, our laws and society have not yet adjusted to their presence. Restrictive laws cannot hope to prevent the harmful transfer of weapons technology, but will undoubtedly halt legitimate companies like Loral from conducting valuable business.

The export restriction bill is now before the U.S. Senate. The challenge for senators is to realize the need to abandon such idiotic and futile policies and pursue creative ways of enhancing U.S. security that fit with the modern age. With membership in the nuclear club expanding weekly, the importance of visionary thinking is greater than ever before.