U.S. GOVERNMENT PRINTING OFFICE

67–608 CC WASHINGTON : 2000

H.R. 3680, TO AMEND THE NATIONAL DEFENSE AUTHORIZATION ACT FOR FISCAL YEAR 1998 WITH RESPECT TO

THE ADJUSTMENT OF COMPOSITE THEORETICAL PERFORMANCE LEVELS OF HIGH PERFORMANCE COMPUTERS

MARKUP

BEFORE THE

SUBCOMMITTEE ON

INTERNATIONAL ECONOMIC POLICY AND TRADE

OF THE

COMMITTEE ON

INTERNATIONAL RELATIONS

HOUSE OF REPRESENTATIVES

ONE HUNDRED SIXTH CONGRESS

SECOND SESSION

APRIL 6, 2000

Serial No. 106–154

Printed for the use of the Committee on International Relations

(

Available via the World Wide Web: http://www.house.gov/international—relations

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COMMITTEE ON INTERNATIONAL RELATIONS

BENJAMIN A. GILMAN, New York, Chairman

WILLIAM F. GOODLING, Pennsylvania

JAMES A. LEACH, Iowa

HENRY J. HYDE, Illinois

DOUG BEREUTER, Nebraska

CHRISTOPHER H. SMITH, New Jersey

DAN BURTON, Indiana

ELTON GALLEGLY, California

ILEANA ROS-LEHTINEN, Florida

CASS BALLENGER, North Carolina

DANA ROHRABACHER, California

DONALD A. MANZULLO, Illinois

EDWARD R. ROYCE, California

PETER T. KING, New York

STEVEN J. CHABOT, Ohio

MARSHALL ‘‘MARK’’ SANFORD, South

Carolina

MATT SALMON, Arizona

AMO HOUGHTON, New York

TOM CAMPBELL, California

JOHN M. McHUGH, New York

KEVIN BRADY, Texas

RICHARD BURR, North Carolina

PAUL E. GILLMOR, Ohio

GEORGE RADAVANOVICH, Califorina

JOHN COOKSEY, Louisiana

THOMAS G. TANCREDO, Colorado

SAM GEJDENSON, Connecticut

TOM LANTOS, California

HOWARD L. BERMAN, California

GARY L. ACKERMAN, New York

ENI F.H. FALEOMAVAEGA, American

Samoa

MATTHEW G. MARTINEZ, California

DONALD M. PAYNE, New Jersey

ROBERT MENENDEZ, New Jersey

SHERROD BROWN, Ohio

CYNTHIA A. MCKINNEY, Georgia

ALCEE L. HASTINGS, Florida

PAT DANNER, Missouri

EARL F. HILLIARD, Alabama

BRAD SHERMAN, California

ROBERT WEXLER, Florida

STEVEN R. ROTHMAN, New Jersey

JIM DAVIS, Florida

EARL POMEROY, North Dakota

WILLIAM D. DELAHUNT, Massachusetts

GREGORY W. MEEKS, New York

BARBARA LEE, California

JOSEPH CROWLEY, New York

JOSEPH M. HOEFFEL, Pennsylvania

RICHARD J. GARON, Chief of Staff

MICHAEL H. VAN DUSEN, Democratic Chief of Staff

JOHN P. MACKEY, Republican Investigative Counsel

PARKER BRENT, Staff Associate

SUBCOMMITTEE ON INTERNATIONAL ECONOMIC POLICY AND TRADE

ILEANA ROS-LEHTINEN, Florida, Chairman

DONALD A. MANZULLO, Illinois

STEVEN J. CHABOT, Ohio

KEVIN BRADY, Texas

GEORGE RADANOVICH, California

JOHN COOKSEY, Louisiana

DOUG BEREUTER, Nebraska

DANA ROHRABACHER, California

TOM CAMPBELL, California

RICHARD BURR, North Carolina

ROBERT MENENDEZ, New Jersey

PAT DANNER, Missouri

EARL F. HILLIARD, Alabama

BRAD SHERMAN, California

STEVEN R. ROTHMAN, New Jersey

WILLIAM D. DELAHUNT, Massachusetts

JOSEPH CROWLEY, New York

JOSEPH M. HOEFFEL, Pennsylvania

MAURICIO TAMARGO, Subcommittee Staff Director

JODI CHRISTIANSEN, Democratic Professional Staff Member

YLEEM POBLETE, Professional Staff Member

VICTOR MALDONADO, Staff Associate

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C O N T E N T S

Page

Markup on H.R. 3680, to amend the National Defense Authorization Act

for Fiscal Year 1998 with respect to the adjustment of composite theoretical

performance levels of high performance computers .......................................... 1

APPENDIX

Prepared statements:

The Honorable Ileana Ros-Lehtinen, a Representative in Congress from Florida, and Chair, Subcommittee on International Economic Policy and Trade,

Committee on International Relations ............................................................... 8

The Honorable Donald A. Manzullo, a Representative in Congress from Illinois ........................................................................................................................ 10

Bill:

H.R. 3680 .................................................................................................................. 13

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H.R. 3680, TO AMEND THE NATIONAL

DEFENSE AUTHORIZATION ACT FOR FISCAL

YEAR 1998 WITH RESPECT TO THE ADJUSTMENT OF COMPOSITE THEORETICAL PERFORMANCE LEVELS OF HIGH PERFORMANCE COMPUTERS

THURSDAY, APRIL 6, 2000

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON INTERNATIONAL ECONOMIC

POLICY AND TRADE,

COMMITTEE ON INTERNATIONAL RELATIONS,

Washington, DC.

The Subcommittee met, pursuant to notice, at 2:10 p.m., in room

2172, Rayburn House Office Building, Hon. Ileana Ros-Lehtinen

(Chair of the Subcommittee) presiding.

Ms. ROS-LEHTINEN. This Subcommittee will come to order.

American ingenuity, creativity and talent has throughout the

centuries spiraled the United States into a position of global leadership. It has enabled us to adapt and build upon economic, political and social changes to usher in a new era of prosperity and opportunity.

Just as Eli Whitney’s cotton gin served as the catalyst for the Industrial Revolution, the computer industry responsible for onethird or real economic growth continues to serve as the driving

force behind the incredible commercial expansion that the U.S. is

now enjoying. However, it cannot continue this unparalleled trend

unless it is able to innovate and compete in new markets. This goes

to the heart of the legislation that we are considering today.

H.R. 3680, introduced by our House colleagues David Dreier and

Zoe Lofgren takes into account emerging threats and security considerations by maintaining a limited waiting period. Nevertheless

it offers a practical, judicious and realistic solution to the challenges faced by our computer industry by reducing the Congressional review period from 180 to 30 days. H.R. 3680 would make

the waiting period more reasonable and bring it into line with

other review periods for changing national security export controls.

Currently, for example, there is a 30-day waiting period established by Congress to remove articles from the munitions list, a list

of Defense articles and services that are subject to export controls

including such items as artillery, launch vehicles, missiles, rockets,

torpedoes, warship, aircraft, and tanks. Yet we maintain a 180-day

waiting period for exports of supercomputers.

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From a practical perspective it does not make any sense for military items or arms transfers to require less time for Congressional

review than that which is required for supercomputers. These products and technology have broad commercial application and an innovative cycle or life cycle of less than 3 months. If we do not reduce the waiting period and expedite the process for our computer

industry, we will have a situation where new export controls will

be out of date by the time they are approved.

For example, the new policy announced by the Administration on

February 1st of this year will be an anachronism by the time the

current 6-month review period expires on August 1st. It is impossible for computer export control policy to keep pace with the everchanging technological and market realities unless we pass H.R.

3680 to reduce Congressional review to 30 days.

We need to avoid a repetition of recent events. For example, last

Fall Apple Computers began marketing its new single processor

personal computer whose power exceeded the computer export control threshold in effect at that time. However, Apple was unable to

sell any of these new systems because the adjustment made by

July of last year did not become effective until January, 2000. IBM

was in a similar situation with its new Aptiva personal computer

line.

H.R. 3680 is a bipartisan bill which provides immediate relief for

the computer industry, an industry which is conducting landmark,

cutting edge work to maintain U.S. technological leadership. H.R.

3680 maintains the delicate balance between national security and

market considerations while providing a more responsive, realistic

approach to export controls on supercomputers.

I am proud to be a cosponsor of this measure, and I am encouraged by the fact that all the majority Subcommittee Members have

also rendered their support as cosponsors, and that person needs

some Florida orange juice for Dana, and I am proud to recognize

Mr. Robert Menendez of New Jersey, our Ranking Member. Thank

you, Bob.

[The prepared statement of Ms. Ros-Lehtinen appears in the appendix.]

Mr. MENENDEZ. Thank you, Madam Chairlady, and I am glad we

are holding this markup. I would have hoped that the legislation

would be as futuristic as the room is and would have a few more

things to it, but at least we are doing something.

Madam Chairlady, the Republicans’ impromptu inclusion of a

180-day Congressional notification period for increasing the

MTOPS level for export sales in the 1998 National Defense Authorization Act handicapped the American computer industry. A 180-

day review period has made it impossible for the U.S. Government

to respond quickly to the latest advances in computer processing

technology.

Last summer for example, new personal computers introduced by

Apple and IBM surpassed the MTOPS level for exports for Tier 3

countries like Israel and Egypt. It was not until after the 180 day

notification period ended in January that these computers were allowed to be sold without a license.

Later this year Intel is expected to introduce the Itanium chip

that will allow a computer that uses four chips to operate at nearly

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23,000 MTOPS, a level that exceeds current policy for export sales

to Tier 2 and Tier 3 countries. In the computer industry, where the

average shelf-life of a computer is no more than 18 months and

probably closer to 12, a 6-month delay in sales is a very long time,

particularly when overseas competitors are nipping at the heels of

American companies.

For this reason I strongly support this legislation. However, I am

disappointed that this legislation only addresses the MTOPS notification period. The legislation does not address other NDAA-derived

problems like the 120-day notification period for moving countries

between tiers and burdensome post-shipment verification requirements.

More importantly, while this bill fixes one problem, it is not a

substitute for reauthorizing the EAA and updating our Cold War

export control policies.

I intended to offer amendments today to address these issues,

but in the interest of the bill’s passage in the House I have decided

to withhold at this stage from offering any amendments. It is unfortunate that there are those who cannot see clear to making

these very important changes that would ensure America’s continued leadership in the computer industry.

America’s industry deserves laws that are responsive to today’s

global economy and not laws that were created over two decades

ago to respond to Cold War era threats.

I know that the Chairlady shares my view that in order to sustain our leadership in the global economy we must take action. I

hope that she and other enlightened Members of the Republican

caucus can talk to some of their colleagues about the importance

of reauthorizing the EAA. No one in the Congress is advocating for

changes that would undermine our national security, but rather for

policy changes that would ensure our national security while also

streamlining our export control laws to focus on those countries

and those exports that are of greatest concern to our nation.

It is our obligation to address this issue and to ensure that our

laws reflect what is in the best interest of our nation. Failure to

do so keeps the Congress and its legitimate role out of the issue

and cedes it to the executive branch, so instead of this piecemeal

approach, we should consider comprehensive legislation, namely

the EAA, to reform our export control laws, but I do urge for the

purposes of solving part of our problems that our colleagues support today’s legislation. Thank you.

Ms. ROS-LEHTINEN. Thank you so much, Mr. Menendez. Mr.

Rohrabacher, Mr. Crowley, do you have opening statements?

Mr. CROWLEY. Yes.

Ms. ROS-LEHTINEN. Yes, Mr. Crowley.

Mr. CROWLEY. Thank you, Madam Chairman.

I am here today to speak in support of H.R. 3680 to amend the

National Defense Authorization Act and reduce the waiting period

for the export of computers from 180 days to 30 days. I am proud

to cosponsor this legislation, which will enable American high tech

companies to compete effectively around the world.

Currently the NDAA requires a 6-month waiting period before

the Administration can update Tier 3 countries’ export control

laws. When NDAA went into effect in 1998 the bill targeted comVerDate 11-MAY-2000 15:51 Nov 09, 2000 Jkt 000000 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 67608.TXT HINTREL1 PsN: HINTREL1
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puters that operated above 2000 MTOPS. Today’s personal computers operate in the 4000 MTOPS range and office servers in the

12,000 MTOP range.

The current 6-month waiting period clearly does not make sense

for products that have a 3-month innovation cycle and are widely

available from our foreign competitors. I know that some of my colleagues think that this legislation is not going far enough. I agree

with them and I am looking forward to working with my distinguished colleagues on this Subcommittee to overhaul the U.S. export control system in a more comprehensive manner, but we also

have to realize how time-sensitive the passage of H.R. 3680 is.

The new Intel microprocessor, the Itanium, will be available at

midyear. A four-way Itanium processor computer is projected to

perform above 22,000 MTOPS, therefore the recent update to a

threshold of 12,500 MTOPS will already be out of date when it

takes effect.

Make no mistake, our current economic boom relies heavily on

the information technology industry. The IT sector contributed

about 35 percent to U.S. economic growth in recent years and foreign sales are crucial to that success, but our broken export control

system threatens to cost the computer industry valuable sales in

some of the most critical markets in the world.

We should concentrate our resources on controlling real supercomputers and not waste them on controlling widely available business computers. This bipartisan legislation is supported by the Administration and the computer industry, and I urge my colleagues

to vote in favor of it today.

Thank you, Madam Chair.

Ms. ROS-LEHTINEN. Thank you so much, Mr. Crowley.

Hillel, if you could pass on to the Chairman our deep dissatisfaction. I had told all the Subcommittee Members that our images

would be portrayed as rock stars on this giant screen before us, but

alas, it is not to be, and I was practicing my air guitar all morning.

Mr. CROWLEY. Madam Chair, I just want to let you know, I think

you are a rock star, no matter whether you are on the screen or

not.

Ms. ROS-LEHTINEN. Aw—thank you. He’s good. He’s good.

Pursuant to notice, the Subcommittee will now turn to the consideration of H.R. 3680, which the Staff Director will report, Mr.

Tamargo.

Mr. TAMARGO. H.R. 3680, a bill to amend the National Defense

Authorization Act for Fiscal Year 1998 with respect to the adjustment of composite theoretical performance levels of high performance computers.

Ms. ROS-LEHTINEN. Without objection, the Clerk will read the

text of the bill.

Mr. TAMARGO. To amend the National Defense Authorization Act

for Fiscal Year 1998 with respect to the adjustment of composite

theoretical performance levels of high performance computers. Be

in enacted by the——

Ms. ROS-LEHTINEN. Without objection, the bill is considered as

having been read and is open to amendment at this point.

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Are there any amendments? If there are no amendments, the

Chair will put the question on favorably reporting the bill to the

full Committee.

So many who are in favor of the question, say aye.

[Chorus of ayes.]

Ms. ROS-LEHTINEN. So many who are opposed, say no.

[No response.]

Ms. ROS-LEHTINEN. The ayes appear to have it. The ayes have

it and the bill will be forwarded to the full Committee.

[The bill appears in the appendix.]

I thank the Members for their cooperation, and before we adjourn I would like to recognize Mr. Bereuter for some statements

and we will be in touch with Chairman Gilman about prompt consideration of this measure in the full Committee next Thursday,

April 13th.

Mr. Bereuter.

Mr. BEREUTER. Madam Chairman, I have no comment. I just

want to commend you on being so expeditious and I was happy to

get here in time for the vote.

Ms. ROS-LEHTINEN. Thank you so much.

The Subcommittee will stand in recess subject to the call of the

Chair. Thank you.

[Whereupon, at 2:25 p.m., the Subcommittee adjourned subject to

the call of the Chair.]

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A P P E N D I X

APRIL 6, 2000

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