11 November 1997
Source: http://www.access.gpo.gov/su_docs/aces/aaces002.html

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[Congressional Record: November 10, 1997 (Senate)]
[Page S12480]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]
[DOCID:cr10no97-111]


                 ENCRYPTION EXPORTS NEED LIBERALIZATION

<bullet> Mr. DORGAN. Mr. President, in the final days of this session,
the Congress is emersed in a debate over our Nation's trade policy. In
my judgement, we have not focused enough attention on our policies that
are hindering our ability to compete internationally and policies that
are increasing our trade deficits.
  One issue that relates the ability of U.S. companies to compete
internationally is the existing policy of the administration with
respect to controls on the exportation of encryption technology.
Currently, U.S. firms are the world leaders in encryption but other
nations are gaining fast. Perhaps the greatest single factor in the
erosion of U.S. dominance in encryption technology is the
administration's export controls.
  As some of my colleagues know, there are several bills introduced in
Congress to address encryption. The Senate Commerce Committee has even
reported legislation in this area and I and the Senator from Montana,
Senator Burns have been pushing alternative legislation that would
require more realistic export controls on encryption. However, the
administration does not need Congress to pass a law to change their
policy in this area and I would like to encourage the administration to
review their current policy and apply more realistic export controls on
encryption technology.
  My understanding is that many other nations have multilaterally
agreed to decontrol the export of computer software with encryption
capabilities. Yet, the United States continues to impose unilateral
controls. Thus, we have handicapped ourselves in the global market.
  Commercial products from companies in Germany, Japan, and England are
securing more of the international market share because those nation's
impose fewer restrictions on their encryption exports than we do. Mr.
President, our Olympic team could not win if they had to compete with
ankle weights. The same is true for American computer hardware and
software companies. They face real competition in the international
market place and their ability to provide strong information security
features is costing them sales of computer systems and software
packages. Lost sales will mean lost jobs.
  In my judgement we need to update American export control policy and
catch up with modern realities of technology and the international
market place. Unfortunately, rather than make real progress on this
issue, the administration has raised all sort of new issues, such as
attempting to impose more controls on domestic encryption. I hope that
the administration will take a second look at their export controls and
start making progress on developing a policy that will allow U.S.
companies to compete. Short of that, I hope we will make some progress
in the Senate in moving legislation sponsored by Senator Burns, the
Pro-CODE bill, which will require a relocation of export controls, but
done in a manner that is sensitive to national security and law
enforcement concerns.<bullet>

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