Editorial: The ITAR Quagmire

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Two months after the U.S. government outlined its plan to overhaul U.S. export-control policies, the system continues to stymie global space commerce and international cooperation — even with close U.S. allies — while undermining America’s space industrial base.

The wheels of bureaucracy turn slowly, but patience is no longer a virtue in this matter, especially given that previous export reform efforts have had little to no discernible impact.

In fact, say European government and industry officials, the problems surrounding the U.S. International Traffic in Arms Regulations (ITAR) and their enforcement have only gotten worse in recent years. This runs counter to assertions by some of the big U.S. prime contractors — who have the wherewithal to navigate the system — that things have improved, assertions that might explain why Washington policymakers have not attacked the problem with any real sense of urgency.

The situation is rooted in an export crackdown imposed by Congress in 1999 following allegations that China was honing its missile capabilities via launches of U.S.-built commercial communications satellites. The law subjected virtually all U.S. space technology and associated know-how to the highly restrictive ITAR rules, which are enforced by the U.S. State Department based solely on national security and foreign policy considerations.

The stated rationale was to protect U.S. national security by curbing the proliferation of advanced military technologies and capabilities. But things haven’t worked out that way. China, for its part, has continued to launch satellites for both domestic and international customers, building up a solid record of rocket reliability in the process, while non-U.S. sources for technologies the export rules were designed to restrict have sprung up in Europe and elsewhere.

Officials with the European Space Agency (ESA) recently said it has become de facto policy to promote the use of European propulsion components over lower-cost U.S. parts because ITAR rules governing data on the American-built hardware make it difficult to troubleshoot technical problems when they arise.

Meanwhile, according to the top executive at one European component maker, certain U.S.-supplied parts have recently come under ITAR restrictions with little warning and for no apparent reason. As a result, the company finds itself having to begin the ITAR-approval process for items that already have been paid for and integrated into products awaiting shipment to customers.

To be sure, the United States does not have a monopoly on questionable technology export rules. For example, French export restrictions have recently disrupted the Italian-led Vega rocket program, according to ESA officials. The technology in question is flight control software developed by France’s Astrium Space Transportation, prime contractor on the Ariane 5 rocket and on France’s strategic missile system. French government officials apparently have balked at giving ELV, the joint venture of Italy’s Avio and the Italian Space Agency that serves as Vega prime contractor, access to the system’s technological building blocks. Understandably, ELV finds this situation unacceptable, and now will have to invest in what is essentially duplicate technology.

Vega already is well behind schedule, with the first flight scheduled for early 2011 from the European spaceport in French Guiana. To avoid further delays, the restrictions on the French system will be waived for that flight, and possibly the second, although this will be done in such a way as to limit ELV’s visibility into the technology.

But having to develop new flight control software is going to further increase Vega’s cost, even if it remains within the acceptable 20 percent cost-growth threshold. More significantly, Vega will be inaugurating brand new technology on its second or third flight, adding risk at a phase of the program when risks are supposed to be coming down.

The situation raises important questions, such as why ESA and ELV officials apparently became aware of it at such a late stage of Vega’s development. As of early June, ESA officials still seemed uncertain as to why the rocket’s flight control system was snagged when other sensitive French technologies, such as the composite motor casings for Vega’s first stage, went through without any problems.

Rocket flight software, which is used for missiles as well, is sensitive stuff. Still, this episode is puzzling given that France and Italy — the first- and third-biggest contributors to ESA, respectively — work closely together on many high-technology development programs. In fact, the French-led Arianespace consortium will operate Vega alongside the Ariane 5 at the French Guiana spaceport.

All that said, there’s little corroborating evidence to suggest that the Vega hiccup is indicative of the kind of systemic problem that pervades ITAR. The Obama administration has emphasized export reform as a way to preserve jobs and U.S. industrial capabilities as it seeks to rein in defense spending following nearly a decade of steep growth. But it remains to be seen whether its plan, which calls for consolidating export licensing authority under a single agency — the Commerce Department currently has authority over so-called dual use items — and dramatically reducing the overall number of items requiring licensing reviews, will have any more impact than previous reform efforts.

This president is not afraid to court controversy in the aerospace arena; his bid to overhaul NASA’s human spaceflight program attests to that. He is going have to be similarly aggressive — and fearless — in his approach to export reform if he really wants to make a difference.