All Your Space Industrial Base

The CEO of the Aerospace Industries Association, Marion Blakey, asked for ITAR reform:

Satellite export control rules are hampering U.S. national security and economic interests, and must be updated to protect the U.S. space industrial base, AIA President and CEO Marion Blakey said Thursday in written testimony before the House Foreign Affairs Terrorism, Nonproliferation and Trade Subcommittee.
“Without meaningful steps to modernize the U.S. export control system and enhance space trade among our allies, the United States faces a real and daunting possibility of losing our leadership in space and ability to compete in the global space industry,” Blakey said.
U.S. market share for commercial satellites dropped from 73 percent to 27 percent after legislation passed in 1998 to control commercial satellites as military items.  The Center for Strategic and International Studies reports that the United States is the only country that requires stringent and time-consuming reviews and approval processes for exports of commercial communications satellites and related components.
AIA recommends that the government undertake a review of all space technologies to determine which ones should be controlled as commercial or military items. The review should be coupled with legislation that allows the administration flexibility to differentiate between sensitive commercial satellite technologies and truly commercial components.


 Get the full testimony here (PDF). And good luck with the RealPlayer Webcast of the hearing.


Space Politics is calling it "Sherman’s March:"

So what kind of reform does Rep. Sherman have in mind? In the near term, it appears he is looking for relatively modest changes. “A lot will depend on the hearings and what solutions come up,” he said. “Solutions that have big problems will move more slowly than solutions that are no-brainers.” An example of a “no-brainer”, he said is getting the Directorate of Defense Trade Controls (DDTC) within the State Department to more rapidly process export license applications, something he said DDTC has already started to do after prodding by himself and others in Congress.

Sherman said that the incidents in the 1990s that triggered the inclusion of satellite technology on the US Munitions List—the transfer of US satellite technology to China after failures of Chinese rockets carrying those satellites—created “an anger [that] was mal-channeled” into the current state of affairs. “I won’t say it’s been ineffective, but it certainly was a crude response.”

His comments, though, indicate a fixation on China, and the availability of low-cost Chinese launches, as a driving interest in ITAR reform that may be misplaced. For example, one solution he suggested for the current ITAR situation was not to necessarily remove satellite technologies from the Munitions List or otherwise reform how their exports are regulated, but to instead subsidize the US launch industry so that they could be cost-competitive with the Chinese. The low cost of Chinese launches “begs the question of how much does China subsidize its rocket program and why aren’t we subsidizing ours to the same level,” he said. “We should be focused on keeping the rocket jobs, the rocket technology, plus the satellite jobs and the satellite technology, here in the United States.”

Of course, such an approach might cost the US billions of dollars a year (on top of what the Defense Department is paying to United Launch Alliance for the EELV) and is no guarantee that it would attract additional commercial customers or simply encourage other countries to further subsidize their own vehicles to compete. (And, ironically, a cheaper alternative is just down the 405 freeway from Sherman’s home district: SpaceX is promising commercial Falcon 9 launches that would certainly be competitive with, or even cheaper than, Chinese vehicles, without massive federal subsidies.)


It truly is about time satcom’s inclusion in ITAR be reviewed, revisited and all that.