Proposed Changes Could Hurt U.S. Competitiveness
WASHINGTON DC – In a speech to the Eighth National Forum on Export Controls, National Foreign Trade Council President Bill Reinsch outlined concerns over the proposed expansion of export controls by the Bush Administration and Members of Congress. Specifically, Reinsch stated that changes in export control policy to combat terrorism are actually intended to expand controls on exports to China, potentially damaging the U.S. economy and over the long term, harming our security.
While recognizing that preventing potential terrorists from acquiring sensitive technology could require changes to the current U.S. export control regime, Reinsch urged caution on proposals aimed at restricting economic relations with China.
In his prepared remarks, Reinsch outlined the following negative consequences of expanded “deemed export” controls on China on the U.S. economy:
“The deemed export expansion…will simply put, drive the smart people away from [the United States] – the same smart people that have been the key to our economic success for the past 200 years.
“Companies will respond by putting their research labs and other facilities offshore, creating a reverse brain drain and ultimately not only transferring more technology offshore but setting up conditions to create it offshore
“[Expanded controls could] cripple transatlantic defense cooperation, retard NATO inter-operability and prompt the Europeans to put more money into their own defense R&D, costing us important sales in the future.”
Prior to serving as President of the NFTC, Reinsch was the Under Secretary for Export Administration at the U.S. Department of Commerce where he was responsible for developing and implementing policies for regulating the export of sensitive goods and technologies.