Monday, November 28, 2011

Is The Space Industry Really "Uniting  in Criticism over ITAR?"

Recent articles, such as the November 17th, 2011 Universe Today post "Could We Soon See the End of ITAR’s Chokehold on Space Exploration" and the November 24th, 2011 Flight Global article "IN FOCUS: Space industry unites in criticism of ITAR restrictions," suggest that well publicized objections by space industry experts to the various provisions of the International Traffic in Arms Regulations (ITAR), are being noted and addressed by lawmakers in Washington.

This perception is likely wrong. To get some sense of why this is so and how this is going to effect the Canadian space systems industry, we need to look at the history of the current legislation.

According to the January 9th, 2006 Space Review article "A short history of export control policy," all items related to US satellites have traditionally been controlled by the US Department of State, which defines them as munitions or "potential weapons" and therefore subject to ITAR approval as a condition of sale. Since the US government doesn't officially want to sell weapons to an enemy, the ITAR compliance process was explicitly designed to be long, complex, expensive and thorough in order to disqualify the wrong applicants.

Ronald & Nancy Reagan in China in 1984.
But beginning in the late 1980's and under pressure from the Reagan and Bush administrations (who were themselves under pressure from US based manufacturers looking to sell satellites and satellite components to the Chinese, Europeans and others) this policy began to evolve to a point where satellite components were perceived of as being "dual-use" items, which could have both civilian and military applications.

This revision would have brought the American definition into alignment with international definitions (which grew out of the industrial "dual-use" list originally maintained during the cold-war era by the Coordinating Committee for Multilateral Export Controls) and helped to facilitate international sales of US satellites and components.

Unfortunately, after a series of promising but false starts and flip flops, all items related to US satellites continue to remain controlled by the US Department of State, which still defines them as munitions or "potential weapons" and therefore subject to ITAR approval as a condition of sale.

But the concept of "dual-use" remains and an entire consulting industry has grown up around the issues surrounding ITAR compliance and navigating the nooks and crannies of the existing legislation. Below is an example of the wealth of ITAR compliance services available and accessible with a simple Google search.

Even worse, the November 13th, 2011 Mother Jones article "In Praise of Simple Regulations," goes so far as to suggest that large corporations benefit from complex regulations (such as ITAR) and often lobby for complexity because the cost of compliance serves as a barrier to entry for new competitors.

The article quotes Washington Examiner columnist Timothy P. Carney as stating:
Some businesses are bigger than others. Some businesses can afford to hire as their lobbyists the very staffers who wrote the bill whose implementation is now being hammered out. Some businesses can afford to hire $500-an-hour lawyers to navigate the rules.

Some businesses cannot.

So, if you're a big business, even if you don't like a law, you can be confident that you'll survive it better than your smaller competitors will. And that's one reason why the biggest businesses often favor regulation in the first place while smaller guys oppose it.
The article also quotes space pundit and Transterrestrial Musings author Rand Simberg as tweeting "this is why it's hard to reform ITAR," and then going on to state that "Boeing et al view it as barrier to entry. They can afford legal staff to deal with ITAR rules. Startups can't."

How does Canada compete in this brave new world of trade barrier regulation masquerading as national security legislation? Not so well, if my November 2nd, 2011 post "Will US Allow Canada to Bid On-Orbit Satellite Servicing Contracts" is anything to go by.

As of now, the prime contractor for the Canadian on-orbit satellite servicing proposal (BC based MacDonald Dettwiler) has no idea if it will be allowed to compete against far less experienced US competitors for this logical follow-on use for iconic CanadArm technology.

Perhaps, what Canada really needs right now, is an ITAR Free CanadArm.


  1. Those regulators paid by earinings of Scientist, Technology, Engineers and Mathematcians or Machinist,etc. are paid
    by taxed business. They should roll out
    the red carpet not red tape.

  2. I recall a brief discussion at the end of an interview with Kent Rominger of ATK on The Space Show ( )

    Dr Livingston: I suppose you would be in favor of real ITAR reform.

    Kent Rominger (ATK): So you know, I am actually fine with how things have been working right now. So I know this system. We're staying within the guidelines and we haven't run into any significant challenges So actually this is all fine.

    No, the current US space industry is not united in wanting ITAR reform.


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