Tag Archives: Mexico

FINALLY, DISCIPLINE, CONDITIONALITY AND COLLATERAL — IN TIME FOR MEXICO? TOO LATE FOR MOSCOW!

(Washington, D.C.): At long last, the Center for
Security Policy’s repeated pleas (1)
for U.S. sovereign lending to be based upon sound principles – –
pleas long ignored by the Bush and Clinton Administrations in the
context of lending to the former Soviet Union and Russia — have
taken hold in connection with the Mexican financial crisis. This
welcome development has been triggered by the requirement to
obtain congressional approval of a vast, $40 billion
taxpayer-guaranteed loan program for Mexico in the wake of that
country’s currency and economic free-fall.

Striking Parallels Between Mexico and Moscow

A distinguished member of the Center’s Board of Advisors,
Roger W. Robinson, Jr., a former chief economist at the National
Security Council and international banker, has noted in his
analysis of the Mexican assistance package a potentially historic
coincidence: Russia and Mexico find themselves competing for the
same, finite pool of Western financial resources in roughly the
same time period even as both countries confront similar
economic, currency and political crises. Indeed, the similarities
between the two nations are remarkable. They include the
following:

  • Both are oil-based economies burdened with bloated state
    sectors and other structural rigidities;

  • Both are grappling with rampant corruption and capital
    flight;

  • Both have experienced currency free-falls of forty
    percent or more since last summer;

  • Both are facing serious domestic insurgencies and ethnic
    conflicts; and

  • Both are in the throes of momentous leadership crises.

To be sure, Mexico, by and large, enjoys a considerable
advantage over Russia in such categories as: progressive economic
development; the levels of integration into the world economy;
the ability to attract foreign investment; the role of its
military-industrial complex; progress in the construction of
democratic and free-market institutions; the intensity of
domestic insurgencies and ethnic strife; and geographic as well
as geopolitical alignment with the United States.

A Legacy of U.S. Government Ineptitude

In reviewing the past decade, the contrast between
the approach of Western government and multilateral institutions
and commercial banks toward Mexico and Moscow, respectively, has
been stark. After its first major financial crisis of August
1982, Mexico’s economic growth was revitalized, thanks, in part,
to its positive response to disciplined lending and other
arrangements imposed by the world’s financial community. By
contrast, Moscow was able to secure tens of billions of dollars
in borrowings during this period without having to accept
Western strictures of transparency, conditionality and collateral.

It is instructive to recall that then-President George Bush
and then-Secretary of State James Baker repeatedly assured the
U.S. Congress and the American people that the contingent
liabilities represented by government guarantees to Moscow would
never come due in a default scenario. As a result, billions and
billions of dollars in taxpayer-guaranteed loans were dispersed
by the ruinously mismanaged Commodity Credit Corporation (CCC) at
the Department of Agriculture and, to a far lesser degree, by the
Export-Import Bank. The Bush-Baker team routinely deprecated the
Center for Security Policy, concerned Members of Congress and
others for daring to suggest that an energy- and resource-rich
nation like the former Soviet Union which (up to that point) had
a solid repayment record, could default on its obligations.

In fact, the net effect of these earlier, unconditionally
extended contingent liabilities was to prove the skeptics
correct: Some $90 billion in public and private sector Western
credits were “rescheduled” (read, written-off, at
least by commercial banks) beginning in January 1992.
Billions of dollars in losses may yet be incurred by the American
people out of CCC — even though accounting sleights-of-hand are
being employed to portray these credits as still recoverable.

Not This Time!

Incredible though it may seem, the Clinton Administration
will shortly be echoing the Bush-Baker team’s earlier assurances
about the viability and prudence of extending new, insufficiently
conditioned multilateral (e.g., by the IMF) and bilateral lending
to Moscow, expected to total roughly $13 billion in 1995. As part
of this sales pitch, the Congress will no doubt be told by
Secretary of State Warren Christopher and Treasury Secretary
Robert Rubin, among other things, that:

  • the Kremlin has put into place a disciplined,
    anti-inflationary budget for 1995, even though hardly
    anyone assigns any credibility to that paper exercise;

  • the costs associated with the Chechen offensive were not
    budget-breakers, even though such costs — estimated
    to be as high as $2 billion and still rising — are
    having a debilitating impact on Russia’s already perilous
    financial condition;

  • capital flight has slowed and privatization is back on
    track, even though funds dispersed to Moscow continue
    to be diverted to secret accounts in the West,
    particularly as high rates of inflation reemerge in
    Russia;

  • the democratic and market reform process is still alive
    and well under Boris Yeltsin’s competent stewardship, even
    though there is little evidence to support such a
    contention.

Fortunately, the crash course in sensible sovereign lending
practices now being provided to the Congress, the media and the
American people in the context of the Mexican assistance package
will be crucial to breaking the code on the next round of U.S.
taxpayer funding for Moscow. In short, strict conditionality
and collateral to protect the American taxpayer’s interests
cannot be demanded in Mexico and then have these same
prerequisites waived for Moscow.

U.S. Financial Assistance: A ‘Zero-Sum’ Game

It should be obvious that, under present U.S. economic
circumstances and budgetary constraints, even if a far smaller
sum were necessary to stabilize the Mexican economy, the Clinton
Administration would be obliged to choose whether it will assist
Mexico or bail-out Russia. It cannot, as a practical matter, do both.

Recognition of the “zero-sum” quality of this
Mexico vs. Russia competition is increasingly evident in the
nervousness of many European countries — notably, the Kremlin’s
most consistent advocate, Germany. The Center for Security Policy
has learned, for example, that just last week a German
representative at the International Monetary Fund strongly argued
against the Mexican assistance package on the basis of size and
conditionality considerations. This suggests that the Germans,
and presumably others among its European partners, expect that
Russia’s claim on projected Western financial resources are in
the process of being diverted from their economic backyard
to that of the United States.

The Bottom Line

If one narrows the lens to examine the
Mexican-Russian competition for U.S. and other Western taxpayer
financing and is forced to choose sides in this debate, the
Center for Security Policy comes down squarely on the side of
Mexico. In any event, the Center believes an urgent, rigorous
retrospective is in order concerning the blunders on both sides
of the Rio Grande that have helped precipitate, if not cause,
the wrenching Mexican predicament. Any assistance program for
Mexico, however, must be characterized by appropriate financial
conditionality and collateral in the form of future Mexican
oil-generated revenue streams.

What should be added to the current U.S. strategy to
stabilize the Mexican economy and currency and restructure its
debt is a sell-down or syndication of American taxpayer credit
exposure to other wealthy allies which have a concrete stake in
the outcome of Mexico’s financial drama (e.g., sizeable,
pre-existing capital investment, involvement in Mexico’s energy
sector, etc.) After all, Mexico is energy-long and capital-short,
while some key American allies are in the reverse situation; they
could step forward for the benefit of all parties. Such an allied
syndication could be accomplished on the front-end of the package
as a precondition to congressional approval or within a year or
two (as this is a multi-year, tranched disbursement of U.S.
taxpayer credit guarantees).

In addition, it is possible — and, indeed, prudent —
to turn to the private sector which is now able to draw on
U.S.-based oil-field equipment, services and technologies. These
assets can now be utilized without oil company involvement or
infringing upon Mexican sovereignity concerns to exploit rapidly
proven, but not yet developed, Mexican oil reserves. Such an
energy-related initiative could utilize a portion of the
government- guaranteed loans to ramp up Mexican oil production in
short order. This would help to collateralize and protect
American and Western taxpayer interests while simultaneously:
shoring up Mexican President Zedillo; expanding his revenue base
for needed development and social programs; preserving the
capitalist transformation of Mexico; and putting NAFTA and its
planned expansion back on track.

In the unlikely event that there are any sizeable U.S.
taxpayer funds still available after legitimate Mexican
assistance requirements have been satisfied, the wisdom of
providing additional American aid to Moscow under present
circumstances should be carefully debated. Under no
circumstances, however, should any future American assistance
flows to Russia go forward on a basis less disciplined,
transparent, conditioned and collateralized than is
currently being planned for Mexico.

– 30 –

(1) See the attached
list of a representative sample of Center analyses reflecting
its concerns and recommendations regarding the folly of
undisciplined lending to Moscow.

Multilateral madness

By Lawrence Goldmuntz

National Review , August 15, 1994

U.S. negotiators are engaged in talks on the ABM Treaty that run in the same old MAD
grooves. If they don’t become bolder, they will merely help the MADness spread around the
world.

For a number of decades the only serious nuclear threat in the world was the one that Russia
and America posed to each other. Each responded to this threat by the deterrent threat of mutual
assured destruction (MAD) — a policy that left much to be desired, but which nonetheless
successfully maintained the nuclear stalemate. On the horizon, however, there is a threat to our
allies and to forwardly deployed U.S. forces from states not generally recognized to be reasonable
and thus deterrable. This threat, in its most serious manifestations, could materialize in
approximately a decade — about the time it would take us to deploy a credible defense system.

In addition to MAD there used to be three approaches to protecting ourselves. Two of the
three have now failed, and the Clinton Administration is in the process of compromising the third
approach, possibly to the point of destruction.

The first approach was to prevent proliferation by controlling the diffusion of technology. This
was to be accomplished by export controls and secrecy. It didn’t work. For example, the French
sold Iraq a “research” reactor, which was actually intended to produce weapon-grade plutonium.
Furthermore, many Iraqi engineers and scientists engaged in their country’s nuclear-weapons
programs were trained in the West; for example, the head of the Iraqi program, Jaffar Dhia Jaffar,
was educated in British public schools and at the University of Birmingham. The emigration of
Russian scientists may be another source of proliferating weapon capability.

The second approach was to prevent proliferation by the physical destruction of a threatening
weapons program. This was the approach chosen by the Israelis when they destroyed a French
reactor on the dock of Marseilles before it could be exported. When France finally succeeded in
exporting a reactor to Iraq, the Israelis proceeded to bomb the reactor complex just outside
Baghdad. This strategy was sharply criticized at the time, especially by U.S. Defense Secretary
Caspar Weinberger. But a more recent Defense Secretary, Dick Cheney, praised the Israeli action,
indicating that it “simplified” Desert Storm.

Still, there is little chance that the Israeli effort will be emulated by the United States itself. As one
American military officer put it, “Such action is not in our kit bag.”

By Land, Sea — and Space?

The third approach is to build the best possible ballistic-missile defense for ourselves and our
allies. Yet the budget for ballistic-missile defense has been cut by 50 per cent over the last two
years. All space-based options have been essentially canceled; the U.S. will rely instead on
anti-missile missiles launched from ground or sea platforms.

The United States’ experience so far with surface-to-air missile defense — the Patriot missile
system during the Persian Gulf War — was not encouraging. The Patriot system had limited
altitude capabilities and could not engage warheads until they had re-entered the sensible
atmosphere. Once in the atmosphere, the warheads inadvertently maneuvered, and the tankage
broke up, providing a field of decoys. Therefore, the Patriot had difficulty hitting the warhead. It
became more of a psychological comfort than an effective weapon.

The new generation of U.S. ground-based anti-missile missiles are designed to engage
warheads at higher altitudes than the Patriot — before they can effectively maneuver. But, if the
first shot is ineffective and a second anti-missile missile is needed, the engagement would probably
be in the sensible atmosphere, where the warhead could maneuver. Furthermore, although
deploying decoys for short-range missiles is difficult, decoy experts claim that every warhead can
be decoyed. And the next generation of theater missiles could, shortly after boost, dispense a
number of submunitions (smaller warheads making up the payload). Such submunitions — a poor
man’s MIRV (multiple independent re-entry vehicles) — could overwhelm defenses.

The most effective defense against ballistic missiles is one that destroys the missile during the
boost phase, when it is most vulnerable. The problems posed by submunitions, decoys, and
maneuvering warheads are then overcome. But boost-phase interception can be reliably
accomplished only from space. And this is precisely the option that is now unfunded.

Furthermore, any future development of this option is being bargained away in the discussions
with the Russians on “clarifying” the ABM Treaty, signed in 1972. Judging by the route that the
Administration is taking in these negotiations, we are giving up precisely the technology that is
most likely to prove effective in our defense and the defense of our allies.

A major issue in the negotiations of the U.S.-Russian Standing Consultative Commission is the
distinction between theater ballistic missiles and strategic ballistic missiles. The objectives of these
consultations are evidently threefold:

  1. To preserve the current ABM regime, which limits investment in defenses against strategic
    ballistic missiles and, presumably, therefore reduces the incentive to build additional strategic
    offensive missile systems.

    2. Under the “clarified” treaty, the U.S. would continue to rely on retaliation — MAD — to deter a
    major strategic attack. Small strategic attacks against U.S. or Russian territory could be opposed
    by the limited defenses permitted under the ABM Treaty. (But even these limited National Missile
    Defenses are essentially unfunded.)

  2. To permit the development and deployment of defenses against theater ballistic missiles so
    long as they could not be used to protect either the Russian or the U.S. home territories against
    strategic missiles.
  3. For all practical purposes to continue the ban on space-based missile-defense systems.

Meeting these objectives will not achieve the fundamental goal of the ABM Treaty: safety and
stability at low cost. The threat has changed since 1972, when the ABM Treaty was signed, and
so have defense technologies.

  1. The immediate threat is from short and medium-range theater missiles targeted against the
    Russian southern and eastern frontier regions and against American allies in the Middle and Far
    East.

  2. There is an emerging threat from decoys, maneuvering re-entry vehicles, and submunitions
    dispersed from theater missiles after burnout. These could probably defeat present and planned
    ground-based missile defenses.

  3. The U.S. has recently succeeded in developing some components of space-based defense
    systems that could provide Russia and our regional allies with better protection against
    sophisticated theater missiles than ground-based alternatives could.

  4. 4. Although a Russian — U.S. strategic-missile exchange seems remote, the capability is still
    there. Increased reliance on mutual defense could lead to additional sharp reductions in strategic
    offensive missiles; and there is no need to limit defense if it is mutual.

Distinctions with Little Difference

Our negotiators propose to differentiate between strategic and theater ballistic missiles by the
re-entry velocities of their warheads. Long-range strategic warheads would be defined as those
with a re-entry velocity of 7 or more km/sec; theater ballistic missiles, as those with a re-entry
velocity of less than 5 km/sec. This limit is derived from the now outmoded Soviet Strategic
Missile, the SS-N-6 (which was assumed to be covered by the ABM Treaty), and from the
Chinese CSS-2 (sold to the Saudis as a theater ballistic missile), each with a re-entry velocity of
approximately 5 km/sec. Presumably our negotiators intend to permit any theater ballistic-missile
defense system to have the capability of intercepting targets with re-entry velocities of up to 5
km/sec. If a system has the capability of intercepting re-entry vehicles with a greater velocity, it
would be disallowed for theater deployment.

A defense system’s capability would be inferred by National Technical Means, presumably
based on observations during the testing phase. This estimate of capability depends heavily on the
questionable premise that a theater commander would be loath to use a weapon beyond its tested
capability — although this is what we did with the Patriot in the Persian Gulf War.

In fact, a defensive missile broadly capable of intercepting a 5-km/sec warhead could intercept
a 7-km/sec warhead under favorable engagement geometries. The number and coverage of
favorable engagement geometries increases with the number of deployed theater ballistic missiles.
Thus, Russian theater-ballistic-missile defenses, deployed on Russian territory, could well have
some capability of attacking strategic ballistic warheads that are re-entering at 7 km/sec, even
though the tests were conducted against a warhead with only a 5-km/sec re-entry velocity.

Furthermore, the “clarification” will evidently not limit the type of warhead that can be used in
the anti-ballistic-missile system. The Russians are likely to use nuclear warheads that have kill
radii of approximately 1,000 meters against opposing warheads. In contrast, the U.S. THAAD
theater defense system, which uses kinetic energy, must actually hit its target to “kill” it. The
Israeli Arrow Defense System, with a high-explosive warhead, has a kill range of tens of meters.
The U.S. is not likely to arm our missiles with nuclear warheads, and so our defense capability
and that which we provide our regional allies will be inferior to the Russians’.

From all this, it seems that the current U.S. negotiating position traps the United States into an
asymmetrical ABM posture. The Russians would need many theater defense missiles deployed
along their southern and eastern frontiers, and could, as we have seen, use these missiles against
strategic missiles. The U.S. needs no theater ballistic defense missiles deployed on its territory
(Canada and Mexico are not a threat), and so will have none available to help with defense against
strategic missiles. This asymmetry is not crucial at the present level of strategic-missile
deployment, since there are enough weapons to punch through these defenses. But the defense
asymmetry becomes more important as the number of strategic weapons is reduced below
START II objectives.

Furthermore, the proposed approach to “clarification” does not address the most serious
evolving theater threats. For example, theater ballistic missiles could deploy chemical or biological
submunitions shortly after boost. If the aggressor’s objective were to terrorize a civilian target,
accuracy of the re-entry vehicle would not be important. It is not unreasonable to estimate that
such a threat may appear in about a decade.

Also within the next decade, one can expect that theater ballistic missiles will be capable of
deploying decoys and maneuverable re-entry vehicles. Such a development enormously
complicates the task of the defense. It was a major factor in our decision in 1972, at the time the
ABM Treaty was signed, to rely on Mutual Assured Destruction rather than active terminal
defense. Boost-phase defense, which is necessary to counter such a threat, was not
technologically feasible at that time.

The boost phase of a short-range 600-km theater missile lasts for approximately one minute.
Thus, boost-phase interception requires very prompt detection of a missile launch — which adverse
cloud and weather conditions can make difficult or impossible. If the intercepting missile is
ground-launched, it must have extremely high acceleration (15 to 30g over a one-minute period)
so as to arrive at the target before burnout. Alternatively, but also with major difficulties, one
might depend on airborne or space-borne lasers to deposit enough energy on the missile’s boost
motor to destroy it before burnout. A third approach would depend on high-performance aircraft
– with anti-missile weaponry cued by all-weather sensors — to attack mobile launchers as they were
moved from hiding or to attack missiles during boost phase. This airborne approach also has
obvious drawbacks. It is not likely that we will be notified of an impending attack, so we must
patrol continuously. Furthermore, these aircraft may have to fly over enemy territory and in any
case are subject to attack.

Brilliant Pebbles

Instead of attacking offensive missiles with explosive warheads, another approach was to force
them to blow themselves up by making them collide with something in mid-course. The first
incarnation of this idea was “Smart Rocks” — chunks of solid matter scattered from a heat-seeking
missile that could find a launched missile and intercept it. A later refinement was called “Brilliant
Pebbles.” These are small satellites with independent sensors and propulsion that can guide
themselves to collide with and destroy theater missiles during launch. These Brilliant Pebbles were
initially designed to attack strategic ballistic missiles, whose boost phases last approximately three
times as long as the boost phases of theater ballistic missiles. This means that, to counter theater
missiles, Brilliant Pebbles would have to accelerate faster and orbit at a lower altitude (with a
consequent need of thrust augmentation to overcome atmospheric drag). Preliminary estimates
indicate these requirements may be achievable with reasonable modifications of the original
design.

It is estimated that 350 Brilliant Pebbles could have intercepted at apogee the most intense
Scud attack launched at Riyadh during the Persian Gulf War. It is further estimated that 600 to
800 Brilliant Pebbles could have intercepted these Scuds before any attempt could have been
made to launch submunitions. These Pebbles would have been launched in an orbit whose
inclination matched the latitude of the launch sites. In a case where launch sites were over a
broader range of latitudes, the number of Pebbles would have to be increased, and if the boost
phase and the range of the missile were shorter than the Scud’s, the number of Pebbles would
have to be increased even further. On the other hand, potential increases in the acceleration
capability of the Pebbles’ rocket motor would tend to decrease the number required.

We have been discussing Brilliant Pebbles as the preferred approach to destroying a theater
missile during boost phase. However, they actually have less capability against theater missiles
during boost than does a space-borne laser (though greater capability to intercept missiles during
mid-course). The drawback to the laser is that it requires a constellation of twelve 65,000-pound
satellites. The most practical launcher would be the Russian Energia; otherwise, two Titan 4
boosters would be required to launch components that would be assembled in space. The system
would not be available for deployment before 2006, if the development program continued at its
previous modest funding level. But even this development budget has been compromised by the
House for fiscal 1995. This is clearly a mistake, because its capabilities complement those of the
Brilliant Pebble system.

Star Wars

Some of the early spaced-based defenses that previous Administrations proposed seemed
far-fetched. For example, nuclear-pumped X-ray lasers were not practical. Detractors coined the
phrase “Star Wars.” These detractors adopted the ideology that space must not be “weaponized.”
However, it was already fully weaponized with offensive weapons — the most dangerous weapons
ever devised, nuclear-tipped ballistic missiles. Why deny space to the defense?

A worldwide deployment of ground- or sea-based theater ballistic missile defenses would
actually be more expensive than a space-based system. Furthermore, the space-based system is
expected to have the additional capability of boost-phase interceptions, which ground-based
systems cannot accomplish. Our negotiators “clarifying” the ABM Treaty must not give away the
space deployment option.

While theater missiles are not a direct threat to the territory of the U.S., they constitute a threat
that greatly concerns our allies in the Middle and Far East — Japan, South Korea, Turkey, Israel,
the Gulf States, Saudi Arabia. This threat could decisively limit our ability to form coalitions to
help stabilize our interests in those regions. These allies would be inclined to appeasement before
exposing their urban populations to destruction. U.S. interests are served to the extent that we
can provide the best achievable protection for our allies against modem theater missiles. Such
missiles are also a direct threat to Russia, with all the potential for instability that that implies.

A Common Future?

The U.S. and Russia have defense objectives that are more nearly common than at any time
since the battle of Stalingrad. Also, Russian space capabilities are complementary to those of the
United States. Their launch capability exceeds ours, and our space-interceptor and satellite
capabilities exceed theirs.

Could cooperation on space-based defenses serve the interests of both countries? Could all
protected countries be assured that the defense systems would work without the possibility of
interference? Could a common defense program lead our allies and adversaries to moderate any
inclination to construct offensive ballistic-missile capabilities? Could cooperation between Russia
and the U.S. lead to the inclusion of such countries as South Korea, Japan, Turkey, Israel, Saudi
Arabia, and even NATO members that may feel threatened by theater missiles from the southern
shores of the Mediterranean?

Our negotiators claim that Russia’s military leaders are not interested in space defenses at this
time. They are operating under severe budgetary constraints. It is also reported that the Russian
military is suspicious of any cooperative arrangements with the United States.

Russian fears might be overcome by many techniques. For example, if the Brilliant Pebble
defense were deployed only at such an inclination as to defend against launches from Libya, Syria,
Iran, and Iraq, it would be incapable of attacking Russian strategic-launch sites.

Should it also be desired to prevent launches from North Korea by such a system, the
inclination of the defending satellites would have to be increased, and a small percentage of
Russian strategic-launch sites could be threatened. There are some options for handling this by
having some degree of joint control of the system. These options must be explored with the
Russians before negotiators conclude that Russian suspicion of the U.S. precludes cooperation.

If U.S. and Russian confidence in such a system developed, it could be extended from a mutual
defense against theater ballistic missiles to a mutual defense against strategic ballistic missiles
launched from sites on the American or the Russian land mass. This is certainly more attractive
than a defense posture based on mutual assured destruction. Furthermore, this would obviate the
need to build ground-based ABM systems to defend either the U.S. or Russia.

No Band-Aids, Please

This should be the agenda of an energetic and relevant review of the ABM Treaty, rather than
the limited and potentially destabilizing Band-Aid now proposed, which only attempts to “clarify”
the boundary between theater and strategic ballistic-missile threats.

It seems that the first step in such a process would be for the U.S. — Russian Standing
Consultative Commission to study the safety, costs, and effectiveness of a joint space defense as
compared to the alternatives. After all, there is precedent for this. The U.S. is now paying Russia,
Ukraine, and others to dismantle some of their nuclear warheads.

If, despite offers of U.S. financing, use of Russian boosters, and shared control of the system,
the Russians reject a joint space-based defense system, the U.S. has the option of implementing
such a system by itself. The first stage could be implemented only to protect our allies against
theater ballistic missiles. If the Russians wanted, the system would protect them from any theater
ballistic missiles launched from the same sites. Later, the space system could be expanded to
provide defense of the U.S. and (again if they were willing) the Russian land mass.

Our negotiators, or the people who give them instructions, should be bolder than they now
seem. At the very least, they should not agree to limit research or development in any area that
could contribute to missile defense. The needed imagination of our negotiators must be matched
by sufficient courage on the part of the Department of Defense and the Congress to fund a
space-based missile-defense system.

If we cannot provide a meaningful defense for our allies, the alternative is that it will become
clear to those countries that nuclear deterrence is their only defense. We will then have a world of
multilateral mutual assured destruction, where Pakistan could destroy or coerce India (and vice
versa), North Korea could destroy or coerce South Korea and, perhaps, Japan (and vice versa),
and so on for Iraq and Israel, Iran and Saudi Arabia, and others. The stability of the bilateral
mutual assured destruction that now exists between Russia and the U.S. would seem blissful, but
only by comparison. On the other hand, successful ballistic-missile defenses, especially if they
were controlled by both Russia and the U.S., would tend to discourage extensive investment in
missile offenses. Take your pick: effective missile defense or nuclear proliferation.

RESTORATION WATCH #2: RUSSIA’S ORGANIZED CRIME

(Washington, D.C.): One of the most
portentous indications of where Russia is
headed was provided to the Senate Foreign
Relations Committee yesterday by CIA
Director James Woolsey. Of particular
concern is the picture painted by Mr.
Woolsey of the cancerous growth of
Russia’s organized crime in recent months
— and the current and potential impact
of these criminal elements on U.S.
national security interests.

Highlights of the Woolsey testimony
included the following:

  • “According to the Russian
    Ministry of Internal Affairs,
    there are roughly 5,700 organized
    crime groups in Russia, with an
    additional 1,000 in the former
    Soviet republics. [Of these],
    200, approximately, are large,
    sophisticated criminal
    organizations engaged in criminal
    activity throughout the former
    Soviet Union and 29 other
    countries.”

  • “A recent report prepared by
    President Yeltsin’s staff
    concluded that 70 to 80
    percent of privatized enterprises
    and commercial banks have been
    victims of extortion [by
    organized crime].

  • “Russian criminal groups are
    actively involved in the illegal
    transport and sale of narcotics,
    antiques, icons, raw materials,
    stolen vehicles, illegal
    immigrants, weapons, and some
    nuclear materials….[T]hese
    groups have the resources with
    which to bribe nuclear weapons
    handlers or employees at
    facilities with weapons grade
    nuclear material.     They
    also have established smuggling
    networks that could be used to
    move such material out of the
    former Soviet Union.”

  • “Criminal groups are also
    targeting the financial sector
    where economic reforms have led
    to explosions in the number of
    banks, in the complexity of their
    transactions, and in the
    geographic scope of their
    activities. ..[T]hese banks have
    become a particular target for
    money-laundering schemes. Indeed,
    links have been forged between
    Russian and Italian organized
    crime groups to move money
    through the Russian banking
    system. In addition to taking
    advantage of these banks,
    organized crime groups have set
    up front companies throughout
    eastern Europe and Russia.”

  • “The power of
    Russian organized crime is
    largely due to their ties to
    corrupt government officials    ….Criminal
    groups may be spending as much as
    30 to 50 percent of their profits
    trying to buy off well-connected
    government officials, including
    Customs, militia, and police
    officials.

  • “[The ramifications are
    enormous. For Russia
    itself there’s a real threat that
    the surge in crime will sour the
    Russian people on President
    Yeltsin’s reform program and
    drive them into the arms of
    Russia’s hard-line political
    forces.    …Beyond the
    threat to Russian reform, the
    growth of organized crime could
    seriously affect our efforts
    worldwide to combat international
    crime.

As it happened, Roger W.
Robinson, Jr., formerly Chief
Economist at the Reagan National Security
Council and a distinguished member of the
Center for Security Policy’s Board of
Advisors, yesterday issued similar
warnings about the security implications
of emerging organized crime operations.
Speaking before the World Affairs Council
of Pittsburgh, Robinson made the
following observations:

  • “At a time when the
    traditional firewall insulating
    market fundamentals is already
    being routinely breached by
    unpredictable political
    shockwaves and tremors — like
    the Colosio assassination in
    Mexico and the ominous directions
    of the North Korean nuclear
    crisis, Whitewater, bilateral
    trade relations with both Japan
    and China, and an increasingly
    revanchist Russia — the witting
    or unwitting disruption of these
    markets by the coordinated acts
    of crime syndicates becomes ever
    more perilous.”

  • “Left unchecked, global
    organized crime will not only
    undermine domestic institutions,
    erode U.S. alliance structures
    and provide infrastructure for
    military and other operations
    against the United States. We are
    now on the threshold of such
    nefarious activities contributing
    to significant increases in U.S.
    long-term interest rates,
    inflation and unemployment, in
    part because they create an
    atmosphere of profound
    uncertainty and inflationary
    expectations.

  • “Virtually every American
    borrower will end up paying this
    new tax-equivalent stemming from
    global organized crime over and
    above the already debilitating
    taxpayer costs associated with
    narcotics trafficking, violent
    crime, financial fraud,
    extortion, racketeering, illegal
    immigration, the destruction of
    neighborhoods, the spread of
    communicable diseases, higher law
    enforcement expenditures and
    other existing by-products of
    this scourge.”

  • “It is surely getting
    difficult for the G-7 summit
    partners to ignore some $1
    trillion in laundered funds
    cycling annually through Western
    economies….If this kind of
    ‘sticker shock’ fails to awake
    the G-7, perhaps the new
    strategic alliances being forged
    between terrorist organizations
    and major criminal groups will do
    so. As nuclear materials
    — even plutonium — stream out
    of the former Soviet Union
    through military/KGB
    entrepreneurs and covert weapons
    procurement networks (à la that
    of Saddam Hussein) proliferate
    among the world’s pariah states    ,
    the consequences for Western
    security interests can no longer
    be permitted to fall victim to
    traditional U.S. interagency
    squabbling.”

  • “A Senior
    Interdepartmental Group — Global
    Organized Crime (SIG-GOC) should
    be established — along the lines
    of the Reagan Administration’s
    SIG for International Economic
    Policy    ….Statutory
    members of this group should
    include National Security
    Council, Central Intelligence
    Agency, Department of State,
    Department of the Treasury, the
    Federal Reserve, Customs,
    Department of Defense, Defense
    Intelligence Agency, National
    Security Agency, Federal Bureau
    of Investigation, Internal
    Revenue Service, Drug Enforcement
    Agency and Immigration and
    Naturalization Service.

  • “The private U.S. business
    and financial community must also
    be more sensitized to the
    symptoms of global organized
    crime, with appropriate penalties
    — including the application of
    the RICO statutes — for those
    entities knowingly facilitating
    such operations or compliant in
    the face of ample evidence of
    wrongdoing.

  • “At an alliance level, the
    G-7 Financial Action Task Force
    must share more intelligence and
    prioritize targets of opportunity
    for joint allied action in the
    areas of prevention, preemption
    and enforcement. Not only
    should global organized crime be
    an agenda item at this July’s
    Naples Economic Summit, but a
    classified G-7 task force should
    be created     by the heads
    of state comprised of
    representatives of finance
    ministries, customs, law
    enforcement, the security and
    intelligence communities, foreign
    affairs, defense ministries and
    central banks.

  • “…There is no avoiding the
    need to bring U.S. and allied
    special forces and other military
    assets to bear on international
    crime-related missions.
    Preemptive action, in particular,
    will be essential if
    international economic and
    financial calamities like those
    described today are to be
    averted.”

  • “Despite the courageous and
    dedicated work of U.S. law
    enforcement agencies (e.g., the
    FBI, Customs, DEA, etc.), the
    leadership of this country has
    not yet demonstrated the
    political will to undertake
    seriously this long twilight
    struggle. So long as this is the
    case, these agencies are being
    sent into the fray without the
    resources required for
    victory….In short, these
    international crime lords have to
    be made to pay a far more
    serious, sustained price which
    only the proper and coordinated
    use of our national security
    assets can exact.    ”

The Bottom Line

These insights into the looming
dangers arising from international
organized crime — and the Russian
contribution thereto — merit the urgent
attention of U.S. policy-makers and their
constituents. Otherwise, highly
publicized legislative initiatives like
the crime bill now moving through the
Congress will inevitably be seen as the
equivalent of “pin-prick
bombing” outside of Gorazde.

OPEN LETTER TO THE REV. LUCIUS WALKER

JOEL DUENAS MARTINEZ

24 March 1994

The author is serving a four-year sentence at Cinco y Medio Prison in
Pinar del Rio, Cuba, for “spreading enemy propaganda.” He wrote this open
letter to the Rev. Lucius Walker Jr., director of the Minneapolis-based
ecumenical group Pastors for Peace, which has been delivering food and
medicine to Cuba through Mexico.

The original Spanish-language version of this letter was published on
Monday in El Nuevo Herald.

REVEREND:

No speech has ever left me so perplexed as yours did, when I read it in
the official newspaper, Granma. Never has a man of the cloth used biblical
quotations for such lowly purposes. I cannot conceive of any priest, minister,
or pastor who would support a dictatorship, much less by resorting to the Holy
Scriptures.

How can a man who calls himself a believer support the Mecca of atheism?
In this country, religious people have been isolated, humiliated, turned into
second-class citizens, expelled from universities, hunted down, and even
imprisoned.

The Catholic Church is not allowed to display religious images in public
processions. Jehovah’s Witnesses are sent to prison for refusing military
induction. In short, being a religious person in this country means
shouldering a cross permanently.

The apparent tolerance now being shown toward religion is nothing more
than a hypocritical posture dictated by circumstances and conditions.

Those who fall for this maneuver are either naifs or apostates.

Do you know what would have happened if the hunger strike that you and
your people staged (last August in Laredo, Texas) had been to protest a ruling
by the Cuban government? In the best of cases, you would all be joining me in
the cell that I occupy at Pinar del Rio’s provincial prison.

In the worst of cases, you would be allowed to die — as happened to
Pedro Luis Boitel. You don’t know that name, right?
Neither do most Cubans. No pastor ever wrote a single word about Boitel’s
situation; he died slowly after fasting for 70 days. His elderly mother
appealed to the man you now praise and begged him to show mercy to her son.
That unfeeling tyrant whom you so admire rejected her plea.

While you people exercise your right to dissent, our government represses
us for expressing ourselves peacefully. That’s what happened when we gathered
outside Villa Marista (the headquarters of Cuba’s state security forces) to
demand freedom for political prisoners. And when our wives, mothers, and
sisters prayed for us at Mercedes Church in Havana, they were brutally
assaulted as they left.

Have you ever asked yourself how many tears our mothers have shed in the
35 years that Castro has been in power?

The undersigned does indeed support the U.S. embargo. I believe that it’s
one of several ways to combat this cruel dictatorship. But while the embargo
helps end this agony, you come up with your ridiculous aid — a coarse
political campaign to perpetuate Fidel Castro’s grip on power.

You should know that sending a letter like this is taking a risk that is
dearly paid for in Cuban prisons. Our mail is monitored by state security
officials, so the controls imposed upon us were circumvented to get this
letter out of Cuba. There will be a high price to pay, and we Cuban prisoners
of conscience pay it.

As I sign off, I regret being unable to call you “brother,” but you
support the man who oppresses my people, the torturer who keeps me behind
bars. While you organize your caravans, my brothers and I endure unfair
imprisonment, ill treatment,
and beatings from the warders you feed with your pharisaical crumbs.

From my cell, I invite you to ask the Cuban government for permission to
visit us. We offer you our small quarters — a 6- by-9-foot cell for three men
— our brackish drinking water, our hunger, and our pain.

I urge you to visit us during your next ride-through. Will you persist in
defending Fidel Castro after going through our hell? I believe that you won’t
— but only if you’re a truly honest man and practice what you preach.

CIENFUEGOS — ‘A HUNDRED FIRES’: MUCHAS GRACIAS MOSCOW, BUT NO AMERICAN CHERNOBYLS

(Washington, D.C.): Featured stories by NBC Nightly News have revealed that the USSR is in the process of equipping Fidel Castro’s Cuba with as many as twelve Soviet nuclear reactors whose incompetent design, shoddy construction, defective materials and inadequate safety features constitute a real and unacceptable risk to the American mainland. The Center for Security Policy believes that the United States simply cannot tolerate these nuclear accidents-waiting-to-happen and must demand that Moscow immediately suspend its shipment of all equipment, technology and nuclear fuel associated with completion of thisprogram. Until the Soviets agree to do so, there simply can be no consideration given to U.S. taxpayer participation in a "Grand Bargain" financial bailout of the USSR.

"The United States must do at once to Cuba’s budding nuclear program with diplomatic and economic tools what Israel had to do to Iraq’s Osirak reactor with F-16s a decade ago — shut it down," said Frank J. Gaffney, Jr., the Center’s director. "Now, as then, the consequences of inaction are too horrible to contemplate."

"At a time when Mikhail Gorbachev is hounding the American taxpayer to save his bacon with billions in credit guarantees, the least we can expect is that he not be a party to frying ours," added Roger W. Robinson, Jr., a member of the Center’s Board of Advisors and former chief economist at the National Security Council. "No additional U.S. official credit exposure in the Soviet Union, particularly in relation to its energy sector, should occur unless and until Moscow delivers firm and verifiable commitments that all Soviet support to the Cienfuegos nuclear program is terminated."

As Tom Brokaw, NBC’s anchorman, put it on 29 May when he broke the story of this horrifying development:

 

"The same people who brought the world Chernobyl now are deeply involved in developing nuclear power plants for Cuba, and [Cuban] defectors [involved in the project] are warning that the Soviet material and design are extremely dangerous."

 

One of the defectors who was in charge of quality control for the Cienfuegos project, Vladimir Cerverra, stated that "Sixty percent of the material the Soviets have shipped us for these reactors is defective." He noted that, in connection with his responsibilities for reviewing X-rays of critical cooling pipes inside the nuclear reactors:

 

"We found a lot of defects: bad soldering, burns, air pockets on X-rays that had been approved. Fifteen percent(1) of what has been approved is defective. The [Cuban] state security system is covering this up because they want the plant to go on line 7he pipe defects we’ve seen can cause radioactive leaks, meltdowns, another Chernobyl."

 

Another Cuban defector, geophysicist Tose Oro, observed that the complete absence of the sophisticated human and technological infrastructure needed to support a safe nuclear reactor program seriously compounded the risks inherent in the Soviet-Cuban scheme. He said, "My country does not have the capacity to run the reactors safely. Building them is an act of megalomania by Fidel."

Actually, whether intended as such or not, building reactors of this design — known as VVERs — amounts to an act of incredible malevolence toward the United States on the part of the Soviet Union. Four VVER reactors built with Soviet assistance on formerly East German territory were recently shut down by Bonn following a series of radioactive leaks. According to NBC, "One plant came close to a meltdown."

The German official charged with shutting down those reactors, Dr. Adolf Berkhoffer, stated that "They had quite a few incidents in the past and we found that the lessons learned from those incidents did not necessarily lead to improvement." An American expert, Dr. Edward Purvis, who headed a Department of Energy investigation of Cuba’s reactors put it even more starkly: "An accident in [the Cuban VVER] reactor is probable. It’s just a question of when….I don’t know if they are the most dangerous reactors in the world, but they are the most dangerous reactors anywhere close to the United States."

The U.S. National Oceanographic and Atmospheric Administration has calculated what the effects of such an accident might be — and they extend far beyond the likely deadly contamination of Cuba, itself. According to NBC’s summary of this study, the day after the disaster could witness radioactive fallout "stretch[ing] from Key West to Managua, Nicaragua. [By] Day Three, the cloud could cover Miami and Tampa, Florida. Within the first week, most of the Eastern Seaboard, portions of Texas and Louisiana, plus all of Mexico might be at risk."

Incredibly, the Bush Administration’s response to such a prospect has been to hope — against all the evidence — that the Soviets and the Cubans will not make any mistakes. Yesterday, Deputy State Department Press Spokesman Richard Boucher described U.S. policy in strikingly clear terms: "Our understanding is that the design of these reactors contain essential safety features very similar to U.S. standards." This is a claim flatly repudiated by the Department of Energy study led by Dr. Purvis which noted that there were "both significant and extensive" differences between the Cuban VVERs and U.S. commercial reactor designs. Indeed, not since Three Mile Island has the American nuclear industry suffered a greater setback to its image and credibility than that delivered by Spokesman Boucher.

Today, Boucher announced that "Cuba has access to technical assistance needed for safe operation of its nuclear power program, both through bilateral arrangements and through the International Atomic Energy Agency." A nuclear industry trade publication, Nucleonics Week, recently revealed that the State Department had gone so far as to issue a general advisory to other nations indicating that the U.S. would have no objection to them providing Cuba with safety-related technology and support. At least one German company, the Kraft Werk Union Power Engineering Division of Siemens, has taken them up on it — negotiating a barter deal with the Cubans said to be worth roughly $40 million. Under its terms, Siemens would replace the reactor instrumentation and control mechanisms supplied by Moscow.

Unfortunately, neither foreign nor U.S. expertise or equipment will correct the fundamental material and infrastructural problems inherent in the Cienfuegos nuclear program. To put it bluntly, the Cuban reactors are time-bombs; once they are set ticking by being loaded with Soviet-supplied nuclear fuel, it is, in all likelihood, merely a matter of time until at least one goes off.

What is more, beyond the obvious safety considerations that are associated with the Soviet-Cuban nuclear scheme, there are serious political, environmental, energy and technology security and strategic issues involved in any decision to help Cuba manage its dangerous reactors or otherwise abet its nuclear development scheme. For example:

  • Having called for free and fair elections, a free press and respect for human rights in Cuba, the Bush Administration presumably wants to see an end to the Castro regime. If so, it is difficult to understand why the Administration would want to see the Soviets — who are being forced to reduce oil exports to Havana — cushion Fidel against the effects of such a cut-off in this manner.

    •  

  • The Soviet Union and its clients have historically been disposed to pursue — for strategic reasons as well as economic ones – actions with immense and devastating ecological implications. The Siberian gas pipeline, North Korea’s Great Dam project and Saddam Hussein’s destruction of Kuwaiti oil fields are all examples of initiatives that put Western interests at risk in more ways than one. It is no coincidence that these initiatives, like the Soviet-Cuban nuclear program, are all energy-related.

    •  

  • Even taking into account the wholesale decontrol of militarily relevant technology announced by the Coordinating Committee on Multilateral Export Controls (COCOM) last week, the transfer of dual-use nuclear-related systems and know-how would appear to represent a breathtaking departure from prudent technology security policies.

    •  

  • Given Castro’s frequent ravings against the United States, the possibility cannot be excluded that an increasingly desperate Fidel might use the threat of purposeful destruction of Cuba’s nuclear facilities as a device to maintain power at home and secure urgently needed technical and financial support from overseas.

 

The Center for Security Policy views the Cienfuegos project as tantamount to eco-terrorism, with the gravest imaginable implications for the American people. It must be stopped. Congress should follow the lead of Senator Connie Mack (R-FL) who has demanded that the U.S. govemment say to the Soviets: "Do not deliver any more technology, no more equipment, no fuel rods for that facility until there is an independent investigation to make sure that [the Cuban reactors are] being constructed safely."

In addition, the Center believes that any prospective financial, technological or energy-related assistance to the Soviet Union be explicitly conditioned on the immediate termination of Moscow’s support for the Cienfuegos nuclear project. Under no circumstances should the State Department be permitted to prescribe embargo-busting American economic and technological life support to Cuba’s nuclear program under the guise of "enhanced safeguards."

– 30 –

1. Interestingly, the mere suspicion that a single weld in a U.S. nuclear reactor has been improperly performed can result in the denial of Nuclear Regulatory Commission certification, pending proof to the contrary.

Will Congress Restore US Technology Security? Export Controls’ Imminent Moment Of Truth

Introduction

Within the past week the congressional Joint Economic Committee and the House Government Operations Committee have held important hearings on the Commerce Department’s role in approving the transfer of an array of highly sensitive technologies to Iraq. The welcome intervention of these committees — which have not, until now, involved themselves in the vitally needed oversight of export administration matters — has revealed three serious problems:

  • The present U.S. system for controlling sensitive exports lacks the checks and balances needed to ensure that the Commerce Department will not permit militarily relevant technologies to flow into the hands of potentially hostile governments.

    •  

  • The two committees of Congress formally charged with jurisdiction for export administration issues are House Foreign Affairs and Senate Banking and Urban Affairs. Particularly, the former committee’s Subcommittee on International Economic Policy and Trade has become, in effect, a rubber stamp for the Commerce Department and elements of the U.S. export industry.

    •  

  • Worse yet, members of these committees may actually aggravate the present situation and, in the process, further weaken U.S. technology security. They are preparing to meet in conference committee to reconcile differences in the two chambers’ versions of H.R. 4653, the "Export Facilitation Act of 1990." This legislation would amend and reauthorize the Export Administration Act which currently governs technology transfers.

 

Insufficient Checks and Balances

Just-completed congressional hearings have highlighted one recent and particularly egregious example of the deficiencies of the present system for administering export controls. In the period immediately preceding Iraq’s invasion of Kuwait, the Commerce Department — with the support of officials at the Department of State — sought to permit a $10 million sale of high-temperature industrial furnaces to Iraq despite a Defense Department assessment that such equipment would be used by Baghdad in connection with its nuclear weapons program. Approval for this transfer was withdrawn just twelve hours before the furnaces were to be shipped to Iraq — and only as a result of the extraordinary intervention of non-governmental experts.

Regrettably, this episode is hardly unique. From 1985 until the Iraqi invasion of Kuwait in August, the Commerce Department granted 486 licenses for shipments of sensitive technology to Iraq. Bush Administration officials have been obliged to acknowledge that, of these sales, as many as fourteen involved technologies that directly contributed to Baghdad’s development of nuclear, chemical, and ballistic missile capabilities.

The latter included transfers to Iraq of, among other things, the following: equipment for infra-red imaging enhancement with obvious military applications; a hybrid analog computer system used in missile wind tunnel experiments — a device that happens to be identical to that used at the U.S. Army’s missile range in White Sands, New Mexico; and extremely sensitive electronic test and measuring equipment now being used at the Iraqi Sa’ad 16 desert missile center.

In some of these cases, Commerce approved the technology transfers involved despite strong opposition from the Defense Department. In many others, however, Defense was simply not informed of the disposition of these licenses until after the fact.

The astounding Commerce Department behavior that contributed so directly to Saddam Hussein’s military build-up, unfortunately, represents more than just a misguided policy toward Iraq. Instead, it is a symptom of a dangerous shortcoming in the statutes governing U.S. export controls — the extremely circumscribed role accorded DoD’s technology security experts in export administration matters. This is the direct result of major rewrites of the Export Administration Act in 1985 and 1988, by which Congress awarded the Commerce Department exclusive responsibility in a number of relevant areas.

For example, in matters such as export license applications and foreign availability assessments, Commerce is only required to consult with the Defense Department, rather than obtain DoD concurrence. As a consequence, Commerce is at liberty to make most licensing and wholesale decontrol decisions irrespective of objections by the national security community.

Congressional Oversight

The congressional committees responsible for imposing these severe limitations on the Defense Department’s role in technology security naturally deserve no small measure of the blame for the resulting fiascos concerning sensitive exports to Iraq. Perhaps that explains the evident and remarkable lack of interest on the part of the committees of jurisdiction in this scandal.

For example, the Subcommittee on Economic Policy and Trade of the House Foreign Affairs Committee — which has, under the chairmanship of Rep. Sam Gedjenson (D-CT), forcefully advocated a radical weakening of the existing export control regime — has yet to make any inquiries, much less conduct hearings, into this matter. In fact, were it not for the hearings recently undertaken by the Joint Economic and the House Government Operations Committees, it appears that there would be no effort made by the Congress to assign blame or to consider corrective legislation.

Making Matters Worse

Worse yet, conferees from the House Foreign Affairs Committee and the Senate Banking Committee are now considering still another major rewrite of the Export Administration Act which is due to expire on 30 September 1990. Far from correcting any of the serious problems with current U.S. technology security so evident in the aftermath of the reckless exports of strategically sensitive equipment to Iraq, the House legislation (H.R. 4653) would compound them. It would do so principally by further expanding the Commerce Department’s authority to make unilateral export control decisions, further diluting the Defense Department’s current role.

Among the ill-advised provisions now being considered by the conferees on H.R. 4653 are the following:

  • Both House and Senate language would require that technologies with chemical, biological, ballistic missile and nuclear applications be restricted through foreign policy controls rather than national security controls. This would, as a practical matter, make it much more difficult to constrain the transfers of such technologies.

    •  

  • Such an outcome would be assured by both House and Senate proposals stipulating that foreign policy controls could be imposed only after the President considers five criteria: the foreign availability of the good or technology in question; the compatibility of controls with other U.S. foreign policy objectives involving the would-be recipient nation; the expected reaction of third countries; the effect of the imposition of foreign policy controls on U.S. exporters and their reputations as reliable suppliers; and the United States’ ability to enforce the controls effectively.

    •  

  • The House would also confine DoD review of export licenses largely to certain exports to the Soviet Union and those Eastern European countries not qualifying for favorable licensing treatment. Fortunately, the Senate adopted a countervailing amendment offered by Sen. Jesse Helms (R-NC) which would authorize the Defense Department to review export licenses for Iran, Iraq, Syria, and Libya and any other countries judged to be involved in the acquisition of chemical, biological, nuclear or ballistic missile technology.

    •  

  • The House version also directs that, within one year, no export licenses will be required for U.S. shipments to COCOM(1) of any militarily critical good or technology. No exceptions would be in order for even the most sensitive of technologies.

    •  

  • Given the abysmal performance of some allies (notably Germany) in preventing the illegal transfers of sensitive technologies, such an arrangement invites a serious hemorrhage of strategic goods and know-how. What is more, the reunification of Germany presents special export control problems, given that the Chairman of the Volkskammer Commission to Control the Dissolution of the Stasi (East German KGB operatives and secret police) reported yesterday that at least half of the 2,448 Stasi officers sent into German firms and institutions remain undetected.

     

  • The House would further direct that no security safeguards are required for the export of supercomputers to any destination as long as they have performance capabilities at or below 25% of the average of the two most powerful supercomputers commercially available. Such an arrangement would be of enormous assistance to countries whose efforts to acquire nuclear weapons require competent — but not necessarily state-of-the-art — supercomputing capabilities.

    •  

  • The House bill would virtually prohibit reexport controls, an important check on the transfer of sensitive technologies to undesirable third-parties.

    •  

  • The House version would require the U.S. government to propose to its COCOM partners that all goods and technologies be decontrolled up to the China "Green Line," a quantum liberalization in a variety of sensitive areas.

    •  

  • The House would also have the government propose to COCOM that exports of state-of-the-art telecommunications equipment for civil end-use be allowed to any country.

    •  

  • Under the House version, national security controls on all products and for all destinations are removed in two years. During the interim period, it will be up to the Secretary of Commerce (not the Secretary of Defense) to determine what goods and technologies should be controlled for national security purposes. Furthermore, each item must be justified in writing and published in the Federal Register.

    •  

  • The House would permit the export of sensitive technologies even to controlled countries for the purpose of "trade shows," irrespective of their military criticality.

    •  

  • The House version would allow the Commerce Department to encroach on other U.S. government agencies engaged in overseas investigations.

    •  

  • The House bill contains an important provision added as a floor amendment at the initiative of Rep. Richard Durbin (D-IL) and approved by an overwhelming majority. It was intended to deny the Soviet Union the benefits of H.R. 4653’s liberalized export control regime until the USSR entered into good faith negotiations with Lithuania and halted its economic embargo.

    •  

  • The House conferees, however, are attempting to interpret the Durbin amendment as pertaining only to such liberalization efforts as may occur in the future with respect to technologies still controlled once the 1990 EAA amendments are enacted. Such an interpretation transparently contradicts the intention of the full House of Representatives and would effectively gut the Durbin amendment.

     

  • While important penalties are mandated by the Senate bill for persons involved in trafficking in technologies related to chemical, biological, and ballistic missile weapons, the sanctions would only apply to violations actually occurring after the legislation becomes law. Thus, companies currently under investigation for earlier transgressions whose convictions might take place after the enactment of the law, would not be subject to such measures. According to testimony before the Government Operations Committee yesterday, 40 U.S. companies are currently under investigation for such sales to Iraq.

 

Conclusion

Recent news accounts and congressional hearings have clearly revealed that the present export administration regime is sorely deficient. Unless the proper lessons are drawn from the technology transfer dimensions of the Iraq crisis, however, pending legislation threatens greatly to exacerbate the present situation.

Consequently, the Center for Security Policy heartily welcomes the conclusion drawn by Rep. Doug Barnard (D-GA), chairman of the House Government Operations Subcommittee on Commerce, Consumer, and Monetary Affairs at the end of yesterday’s hearing concerning exports to Iraq and H.R. 4653. He said:

 

I am sure I voted for the extension of the Export Administration Act, probably innocently though. The fact is that maybe we were being a little bit too liberal in what we were doing in that regard. So I certainly would admonish the conference, especially because of the information which has developed since the bills were passed, to look at this conference very, very carefully. I would also — if I was President of the United States, take a new look at it myself as far as the veto is concerned.

 

The Center urges the conferees to drop all provisions of H.R. 4653 that would further dilute the Defense Department’s ability to prevent dangerous technology transfers or otherwise facilitate potential adversaries’ efforts to acquire sensitive goods and know-how from Western sources. Should that not be the result of the conference, the Center would join Rep. Barnard in urging a

1. COCOM countries include those comprising NATO plus Japan and Australia, minus Iceland.

Showdown On SDI: Senate To Debate The Ultimate ‘Killer Amendment’

Introduction

The United States Senate will shortly consider the FY1991 defense authorization bill, S. 2884, reported out of the Senate Armed Services Committee on 20 July 1990. The debate on this legislation promises to be among the most contentious in recent memory as floor amendments are offered to challenge — or augment — the Committee’s recommendations for programatic terminations, slowdowns and personnel cuts.

One such amendment will be offered by Senators Jeff Bingaman (D-NM) and Richard Shelby (D-AL). It proposes to restructure fundamentally the Strategic Defense Initiative (SDI) with a view to preventing the executive branch from acquiring an option to deploy a layered, effective defensive system in the near-term. Specifically, it would reduce funding for Brilliant Pebbles, the highly promising and relatively inexpensive space-based interceptors currently envisioned by the Bush Administration as a key component of a deployable SDI system.

Instead, Senators Bingaman and Shelby wish to emphasize two other areas of defensive research: long-term, directed energy weapon systems (particularly those involving such exotic technologies as free electron and chemical lasers — devices in which national laboratories in New Mexico play a leading role) and ground-based kinetic-kill weapons (systems for which the Army’s Strategic Defense Command in Huntsville, Alabama has primary responsibility).

When combined with the draconian reductions in SDI’s top line (reduced by the Committee from the requested level of $4.7 billion to S3.7 billion), such restrictions would have the effect of precluding validation of Brilliant Pebbles. In so doing, the authors of the Bingaman-Shelby amendment would thwart President Bush’s policy direction to the Department of Defense to provide by 1992 the necessary technical base for a presidential decision on deployment of an effective SDI system.

A Cynical Marriage of Convenience

Even as Congress has systematically reduced the Pentagon’s funding, a number of legislators have reacted by trying to protect certain affected constituent interests. Senators Bingaman and Shelby have shown that SDI is no exception; their amendment would protect elements of the program in New Mexico and Alabama which would suffer if obliged to absorb proportionate shares of an across-the-board cut.

Two other impulses appear to be at work as well, however:

 

    The Bingaman Agenda

     

For his part, Sen. Bingaman is among those in the Senate — a group that evidently now includes Armed Services Committee Chairman Sam Nunn — who have little (if any) interest in actually deploying a meaningful, nationwide defense against ballistic missile attack. A powerful impetus for their antipathy to SDI lies with arms control theology; the 1972 Anti-Ballistic Missile Treaty, which bans such a territorial defense, is simply regarded as holy writ. Its devotees believe that the Treaty must be observed by the United States in perpetuity even though it has been violated by the USSR and its central concept — mutual U.S. and Soviet vulnerability — is being rendered obsolete as the number of countries possessing ballistic missiles soars.

This purpose would, of course, be well served by an amendment like Senator Bingaman’s which would effectively gut near-term technologies that are inherently inconsistent with the ABM Treaty, such as the space-based Brilliant Pebbles.

A number of Democratic legislators, again notably Sen. Nunn, have nonetheless seemed a bit uncomfortable with being cast as opponents of any strategic defense whatsoever. While such that condition reflects the logic of the ABM Treaty — and was the Treaty’s consequence for the United States — its endorsement remains somewhat problematic politically in most of the country. This is likely to become increasingly the case as more and more Americans become seized with this country’s utter vulnerability to nuclear attack from hostile Third World nations newly equipped with ballistic missiles, not to mention an ever more unstable Soviet Union equipped with thousands of thermonuclear weapons.

 

    The Shelby Gambit

     

Enter Senator Shelby. The Bingaman-Shelby amendment hedges against the charge that its sponsors want nothing more than to fritter away finite SDI resources on endless research and development — a sort of high-priced "hobby shop," designed to employ constituents but not to produce anything that might inconveniently prove to be deployable. It does so by increasing and fencing funds associated with ground-based kinetic-kill systems which could be deployed in a manner compatible with the ABM Treaty (i.e., 100 interceptors based at one location in the United States).

Unfortunately, ground-based systems alone simply cannot achieve the leverage needed to provide an effective strategic defense. While such systems may have some utility against accidental or unauthorized launches or very limited attacks, provided they are properly conceived and situated, and are certainly desirable as an underlay for a space-based defensive component, they have certain unavoidable limitations.

In contrast to space-based weapons like Brilliant Pebbles — which, thanks to their ability to attack ballistic missiles early in flight trajectory and, thereby, to destroy multiple warheads with a single interceptor, have the potential to be more cost-effective than offensive forces — stand-alone, ground-based defenses can only attack incoming warheads after they have been dispersed from the launching missile and in their final stage of flight. Without a layer of Brilliant Pebbles as envisioned by the Bush Administration’s SDI program, it would be a relatively trivial task for an attacker to overwhelm such ground-based kinetic kill defensive systems (particularly treaty-limited ones) by increasing the number of warheads employed in his assault.

In the past, this shortcoming of traditional territorial defenses proved fatal to U.S. efforts to deploy them. Not surprisingly, those who favor early deployment of an effective SDI system suspect that the Shelby approach (like the so-called Accidental Launch Protection System (ALPS) proposed several years ago by Sen. Nunn) is actually a subterfuge, designed to provide political cover and (in some cases) constituent jobs — not meaningful strategic defenses.

Conclusion and Recommendation

The Center for Security Policy believes that the reductions in funding for the Strategic Defense Initiative recommended by the Senate Armed Services Committee are unwarranted and ill-advised. The Center judges that — despite such reductions — a vigorous development effort could nonetheless be mounted leading to an early deployment option for effective defenses provided the Defense Department has the latitude to use resources efficiently.

The micromanaging of the SDI program contemplated by the Bingaman-Shelby amendment is calculated to deny the Pentagon such latitude, however. When combined with the deleterious effects of congressionally imposed budget cuts, the impact of this amendment will be even more insidious.

In fact, if enacted, the Bingaman-Shelby amendment can reliably be expected to produce the following:

  • wholly inadequate funding for Brilliant Pebbles — thereby preventing the earliest possible realization and deployment of a robust U.S. defensive system;

    •  

  • pursuit instead of a technical, strategic and, ultimately, political dead end — a single layered, ABM Treaty-limited ground-based interceptor program; and

    •  

  • unwarranted spending on interesting but long-term and lower priority technologies — amounting to a make-work program for certain national laboratories.

 

The Center believes that the Bingaman-Shelby amendment and other efforts designed to deny the nation and President Bush the opportunity he has called for -namely to make a decision on deployment of an effective SDI system by 1992 — dictate a veto of any legislation to which they are attached. It calls upon the Bush Administration to convey that message to the Senate at once and urges members of that body to defeat such pernicious initiatives.

 

Congress Forgets the Meaning of Defense

By MALCOLM WALLOP
The Wall Street Journal, August 2, 1990

At the 1987 Washington summit, Soviet spokesman Georgi Arbatov posed a rhetorical
question: “What will you do when we deny you an enemy?.” Three years later U.S.
policymakers seem to believe they are now confronting that problem.

Several weeks ago the Senate Armed Services Committee completed work on a major
defense bill that cancels or severely cripples a number of important strategic programs. On
Tuesday, the House Armed Services Committee marked up a defense bill that could do
yet more damage to national security. The trouble here is that no one is asking whether the
Soviets are merely denying us the perception of an enemy. The Soviets may even be doing
so in order to undermine the American consensus for a strong defense. Soviet success in
any case shows that lawmakers’ will to believe in Mikhail Gorbachev’s benign intentions is
too strong.

The U.S. Defense Department is, of course, certainly not entitled to a blank check.
Reasonable cuts in defense spending are the necessary response to the world’s changing
military and political situation, and to our own deficit woes. But the Pentagon is not a cash
cow to be milked to nourish a bloated welfare state. Its mission is to safeguard our
freedom by keeping our military forces strong and ready.

Military Unpreparedness

Take a look at history. Every time the U.S. has embarked on a drastic unilateral
reduction in military capability for a short-term gain, the ultimate result has been a high
cost — in American blood as well as treasure.

We were woefully unprepared when we entered World War I. Recruits drilled with
broomsticks instead of rifles, and the U.S. had to borrow artillery, tanks and aircraft from
the French and British. In the 1930s, isolationism gave us a weak military. With Pearl
Harbor, we learned the cost. U.S. submarines went to war with torpedoes that would not
explode on contact. Our aviators and their obsolete aircraft were shot down in scores by
Japanese pilots flying modern Zeros. After World War II, the lesson repeated itself. The
U.S. demobilized precipitously and announced that it had no security interest in East Asia.
The result was the North Korean invasion of South Korea 40 years ago this summer, and
the death of 50,000 Americans.

Congress today is overlooking the high price of unpreparedness in its zeal to spend the
peace dividend — before there is a dividend, and before there is true and certain peace.

The defense legislation pending in the House would terminate the B-2 Stealth bomber
program and stall the modernization of intercontinental ballistic missiles. The legislation in
the Senate also stops modernization of ICBMs. There is no strategic rationale for these
steps. The process that produced the legislation was not a thoughtful exercise in defense
policy analysis, but an accountant’s exercise. The very term “peace dividend” is the
language of accountants. So it should come as no surprise that Congress is acting with
little consideration of specific threats, strategic imperatives or military requirements. The
result is strategy made by bookkeepers.

The most glaring example of the triumph of short-term politics over sound defense
policy is the attitude toward strategic programs, space and the Strategic Defense Initiative.
Even though the Warsaw Pact may no longer pose the threat of conventional war for
NATO, the Soviet threat at the strategic end of the warfare spectrum remains real. The
Soviets are modernizing and expanding their nuclear arsenal. Their military space program
and their own “Star Wars” plans continue unabated.

Yet in Washington, the committee mark-up sessions and the legislation that followed
showed no concern over the use of nuclear power for diplomatic leverage or blackmail.
The sessions have ignored the possibility that the Soviets are merely following one of their
old military doctrines: “victory without war.” One way to explain American failure to aid
Lithuania’s freedom struggle — morally or financially — is that the U.S. is already
intimidated by the Soviet nuclear arsenal. Sen. Sam Nunn, chairman of the Armed
Services Committee, has made many speeches and issued many statements explaining the
Senate bill’s strategy, but not one discusses the critical importance of space to U.S.
security and prosperity — an astonishing omission for any strategy that claims to “look
forward, not backward.”

In a trip to Lawrence Livermore National Laboratory in February. President Bush said,
“In the 1990s, strategic defense makes more sense than ever before.” But the Senate
Armed Services Committee authorized nearly a billion dollars less than the president’s SDI
request. The House Armed Services Committee proposes to cut SDI by nearly $2 billion.
When the two chambers split the difference, the result could be a major reduction in SDI
funding, an actual decline in real dollars, not merely a cut in the planned increase.

There are worse prospects for SDI than reduced funding. Sen. Jeff Bingaman (D.,
N.M.) and Sen. Richard Shelby (D., Ala.) intend to offer an amendment to the Senate
defense bill that would radically restructure SDI. This comes at the moment when the
program stands on the threshold of producing concrete benefits. By cutting $400 million
from Phase 1 of SDI and “brilliant pebbles,” the most promising near term technology, the
amendment would foreclose the deployment an actual defense system, and steer SDI
toward long-term open ended research. The Senators would sacrifice the Defense
Department’s freedom to manage the program efficiently, and allocate the bulk of funds to
established interests — interests not coincidentally located in New Mexico and Alabama.

Sen. Nunn has predicted that a “broad national debate” on strategic defense will result
from this amendment. He’s quite right. The American people will have the chance to
decide whether they want SDI to become a technological welfare program or whether they
went to get any return — in the form of an actual defense — from the six years and nearly
$20 billion invested in SDI. They must decide through their elected representatives
whether to ensure by law that SDI will never produce any real security and will instead
become merely another expensive entitlement program.

Ironically, scientists and engineers working on SDI don’t favor pure research either.
They, too, hope for a usable product. In a recent report for the Strategic Defense Initiative
Organization, leading scientists from both Los Alamos and Lawrence Livermore National
Laboratories agree that “Brilliant Pebbles offers effective and survivable space based
means for addressing near and long-term missile threats in the boost phase.”

Building on the steady and dramatic technical progress to date, and under the Strategic
Defense Initiative Organization’s new director Henry Cooper, there is the real possibility
that SDI funds will be spent to build the protection that the American people think they
have been paying for all along — unless Congress passes the Bingaman-Shelby Amendment
into law.

If we turn our backs on SDI, we’re not just rejecting the option of defense against
ballistic missiles. SDI also means progress in the critical arena of space. It is significant that
the Senate defense bill would also terminate the MILSTAR space-based command and
control program, and that Sens. John Kerry (D., Mass.) and Tom Harkin (D., Iowa) want
to kill off our anti-satellite capability as well.

As long as there is conflict between competing interests and ideologies, space will not
be exempt from it. Indeed, we are entering an era when space control is becoming the
crucial military leverage, and may determine the course of future conflicts — without a shot
ever being fired by terrestrial forces.

Military forces have historically opened the way into new frontiers of human endeavor,
whether it was navies opening up the high seas, or, as in our own history, the Army
exploring the new Western frontier, and providing security for settlers, homesteader and
railroads.

pattern. The military’s initial investment and sustained operations in space will push
technology forward, bring down the cost of launching and keeping platforms in orbit, and
provide the nucleus of future settlements and commercial ventures. As in the past “trade
will follow the flag.”

Via SDI to Space

The first step toward the essential mastery of space is SDI, the greatest technical and
strategic innovation of the past quarter century. A strategic defense system will greatly
reduce the military utility or blackmail potential of nuclear armed ballistic missiles. But
SDI will give us more than just a missile defense. It will also lead the way to U.S.
dominance in the ultimate high ground of space, and the “high seas” of the future.

The list of civil and commercial as well as military benefits to be gained from space is
endless. But the investments will be, shall we say, astronomical. Can we expect businesses
to risk huge investments in space unless their security is reasonably assured, unless U.S.
interests in space can be defended as they are on the earth’s surface? If congressional
leaders, especially leaders of the armed services committees, allow Congress to forestall
the immeasurable advantages of a space-based strategic defense, then their pretensions to
the role of strategist ring hollow.

As Congress takes up action on the defense bill, the American people need to remind
their representatives that American moral strength, political resolve, military capability and
technical prowess over the past 40 years have brought us to the threshold of victory. When
we are so close to seeing the end of Soviet imperialism, the dividend ought to be more
than a transitory or illusory peace. By our continued resolve, peace, when it comes, will be
genuine and lasting.

Sen. Wallop (R., Wyo. ) is a member of the Armed Services Committee.

Not Free, Not Fair: An Assessment Of The 20 May 1990 Elections In Romania

Introduction

On 20 May 1990, 14.6 million of the over 17 million registered voters in Romania voted in national elections. For the first time since the Stalinist regimes of Eastern Europe began to unravel in late 1989, a communist party — now calling itself the National Salvation Front — received more than a small portion of the vote. In fact, the Front’s presidential candidate, Ion Iliescu, received 85 percent of the vote while the two opposition candidates from genuinely democratic parties, Radu Campeanu and Ion Ratiu, received 11 and 4 percent respectively.

In a pre-election analysis, the Center examined whether the post-Ceausescu communist regime, the Front, was truly permitting the democratic opposition parties to have a fair opportunity to compete for votes during the election campaign. It is now apparent that the concerns that the Center raised in that paper, entitled Romania: Will the Communist Successors to Ceausescu Permit Truly Fair and Free Elections? (No. 90-45, 11 May 1990), were well-founded. Put simply, the Front was successful in compromising the election campaign and corrupting its results.

The Compromised Campaign

Among the problems that made the campaign less than free and fair were the following:

  • The Front fully exploited the resources of the government and had unlimited use of public funds in its campaign. In many towns, the National Salvation Front was the only party able to campaign actively.

    •  

  • The Front intimidated and attacked opposition supporters throughout the campaign. These "violent physical attacks" have been documented by international human rights groups. Margaret Thompson, program director for the U.S. National Republican Institute for International Affairs, for example, has recounted seeing opposition rallies broken up by club-wielding gangs. At times, she said, members of one opposition group, the Peasant Party, were "beaten and run out of certain towns."

    •  

  • "Free Romanian Television" — which played such an important anti-Ceausescu role during the violent events of 1989 — ran programming strongly favoring the Front regime and giving very little coverage to the democratic opposition parties.(1)

    •  

  • The dreaded secret police (the Securitate) were transferred to the Ministry of Defense in late December 1989 by interim President Iliescu. Thereafter, all televised (i.e., officially sanctioned) criticism of the Securitate suddenly stopped. Moreover, foreign reporters and others noted months later that, in many places, plainclothes Securitate officers were going about their work as they had before the fall of Ceausescu.

 

Corrupted Election Results

Western and international observer groups were present in Romania during the voting on 20 May 1990. Based on their observations, a number of other indications of a fraudulent election have now been reported. For example:

  • Election observers discovered ballots pre-marked for the National Salvation Front;

    •  

  • Local officials of the Front regime were reported to be inside polling booths while the polls were open;

    •  

  • The fact that the Securitate is widely believed still to be operating, combined with the systematic pre-election violence and the tradition of rigged Romanian elections, evidently gave rise to a climate of fear whose impact on the balloting was, while difficult to quantify, nonetheless quite palpable.

 

Aftermath of a Rigged Election

As a result of these developments, the presidential candidates for both main democratic parties denounced the elections. Ion Ratiu of the National Peasant Party stated, "the run-up to the elections has been totally undemocratic." Similarly, Radu Campeanu, presidential nominee of the National Liberal Party, who had warned on the day of the elections that "there is a fear they will be rigged," claimed two days later that fraud had cost him as much as 25 percent of the vote.

In a belated protest against the unfairness of the campaign, the Bush Administration withdrew its Ambassador prior to the election and publicly criticized the Front on 10 May 1990. Then, in the face of irregularities during the voting process itself, the Bush Administration initially took the correct step and urged the Romanian government to form an independent commission to investigate the charges made by Romanian democratic leaders and western observers.

This recommendation was rejected by Iliescu, by then the president-elect. Shortly thereafter, on 26 May 1990, the State Department made the serious mistake of asserting that — although irregularities had marred the Romanian election — the U.S. lacked "evidence that these…were of sufficient weight to have altered the outcome."

In part, thanks to the legitimacy conferred on the National Salvation Front by Washington’s revised appraisal of the election, Iliescu was able to claim that those protesting the unfair election (who were brutally attacked yesterday in Bucharest by government forces) amounted to "an organized attempt to remove by force and violence the country’s elected leaders."

Recommended Policy Approach

The Center for Security Policy believes that, rather than legitimize this recent election and condone in any way the Front’s repression of advocates of genuine democracy, the Bush Administration should take a strong stand against the unfree, unfair Romanian campaign and election. Doing otherwise constitutes a dangerous precedent for future elections in Romania and elsewhere in Eastern Europe.

Consequently, the Center recommends that the United States take the following steps:

  • Refuse to acknowledge the National Salvation Front regime as a democratically elected government. The Iliescu government should not enjoy the same privileges and public standing as its East European neighbors which have held genuinely free and fair elections.

    •  

  • Insist that Romania accept the two recommendations suggested by New Mexico Governor Garry Carruthers, head of the U.S. Presidential Observer Delegation, namely, to:
    • "Encourage and assist with the development of a much wider range of free and independent broadcast media in Romania, and…see such a development take place before the next national elections," including the creation of a private, independent television station; and,

      •  

    • Form an independent commission to examine and report publicly on the irregularities surrounding the 20 May elections.

    •  

     

  • Link any future U.S. economic assistance to the Iliescu regime’s tolerance of opposition groups and public dissent;

    •  

  • Disclose and criticize any continuing links between the KGB or other Soviet security apparatuses and elements of the Romanian Front regime. Similarly, the United States should make regular reports of any hostile international actions on the part of the Romanian regime or its suppression of the democratic freedoms Romania has pledged to uphold since the Helsinki Final Act of 1975.

 

1. See Crisula Stefancescu, "’Free Romanian Television’ Losing Its Credibility," Report on Eastern Europe, 23 March 1990, pp. 24-29.

Now It’s Time To Ensure That Democracy Actually Prevails In Nicaragua

‘People Power’ Nicaraguan-Style

In a stunning victory for the courageous people of Nicaragua, the repressive Sandinista regime was soundly defeated in its effort to secure through elections the right to rule which it had only enjoyed previously by force of arms. This is cause for jubilation not only on the part of Nicaraguans but also for those in Central America and other parts of the hemisphere whose security was directly, or indirectly, threatened by Sandinista aggression. For that matter, the results of the election in Nicaragua represent a triumph for freedom-loving people everywhere.

Two points are worth noting about this outcome, however. First, the opportunity it promises for democracy and peace in Nicaragua is basically that which was pledged — but ultimately denied — by the Sandinistas when they came to power following the 1979 revolution. More than a decade of Sandinismo misrule and oppression have evidently done nothing to diminish the Nicaraguan people’s longing for rights they expected to obtain when the previous dictator, Anastasio Somoza, was deposed.

Second, this Sandinista defeat is all the more remarkable for the extraordinary lengths the Nicaraguan government went to to preclude that result. As documented in an earlier Center analysis released prior to the election (This is No ‘Free and Fair’ Election, No. 90-15, 20 February 1990), the Sandinistas clearly employed a broad range of techniques designed to rig the vote and deny the opposition a popular mandate.

Unfortunately for the Sandinistas, their efforts to steal the election — which sympathetic international observers like Jimmy Carter and Elliott Richardson trivialized or dismissed out of hand — instead of proving decisive merely served to reduce the size of Violeta Chamorro’s margin of victory. It is worth noting, however, that if there been no subterfuge on the part of the Managuan regime, the final tally would likely have shown an even more sweeping repudiation of Daniel Ortega and his organization by the people of Nicaragua.(1)

In fact, the conditions under which the Nicaraguan election went forward would not have been judged "free" or "fair" had they taken place in Chile or South Africa — to say nothing of in Jimmy Carter’s state of Georgia. Such conditions must not now be so legitimized by the Nicaraguan election’s international observers as to enable communists elsewhere — notably in Eastern Europe and the Baltic states — to succeed where their Sandinista colleagues failed, namely in thwarting the popular will.

Democracy’s Victory in Nicaragua is by No Means Assured

Unfortunately, there is considerable evidence that the Sandinistas who tried to steal this election will now, having lost it, attempt nonetheless to retain control. Statements made during the campaign and subsequent to Ortega’s acknowledgement of defeat smack of a determination to preserve the Sandinistas’ domination over the military, the secret police, and the government bureaucracies. Their recent demand that the Nicaraguan resistance be disbanded at once as a precondition to a peaceful transition appears tantamount to anti-democratic extortion.

Indeed, only by carefully monitoring the following will it be possible to determine the true extent of Sandinista willingness to accede to the Nicaraguan electorate’s clear desire for a wholly new government with new people and radically different policies:

  • Will the Sandinistas continue to insist that the Nicaraguan armed forces remain de factode jure linked to the Sandinista party? if not

    •  

  • Will the Sandinistas try to coerce the victorious President-elect Chamorro into accepting what would amount to a coalition government, with Sandinista officials in key positions such as those controlling (and staffing) the military, the secret police, the banks, educational institutions, and the media, communications and transportation sectors of the economy?

    •  

    It is especially important that the Sandinistas not be allowed to render Mrs. Chamorro a figurehead by retaining effective control of such portfolios as that of the Commander-in-Chief of the armed forces and Minister of Interior (responsible for the security services).

     

  • Will the Sandinistas agree to terminate all support for the communist guerrillas in El Salvador and other violent groups at once? This would require, among other things, that the guerilla front, known as the FMLN, no longer be permitted to operate out of Nicaragua; that command and control sites supporting the subversion in El Salvador from Nicaragua be dismantled; and that arms and money supplied by the Soviet Union, Cuba or other sources no longer transit Nicaraguan territory.

    •  

  • Will the Sandinistas agree to end all cooperation with the intelligence and military services of the Soviet Union, Cuba and other Eastern bloc nations? Such activities should be displaced by cooperation between the Chamorro government and democratic elements in Eastern Europe with a view to sharing insights into how best to root out and eliminate communist totalitarian organizations.

 

Defining a Constructive U.S. Policy

The United States should be fully prepared to help a Nicaragua truly free of Sandinista rule. Provided the foregoing questions are answered affirmatively, this country should adopt a policy approach designed to foster the political and economic environment the people of Nicaragua so clearly demand. Under such an approach:

  • The United States should facilitate the cease-fire announced yesterday by Ortega and call for the establishment of a international mechanism for its supervision under the auspices of the Inter-American Defense Board (IADB) of the Organization of American States.

    •  

  • The U.S. government should urge that Mrs. Chamorro not only reduce the size of the existing Nicaraguan military establishment(2) but that she announce the creation of an entirely new national army. Such a military force should be an all-volunteer one, with conscription ended and conscripts presently serving released from their obligations as quickly as possible. The opportunity to participate in the new armed forces should not be denied on the grounds of prior duty with either the Nicaraguan resistance or the Sandinista party army.

    •  

  • Until such time as this national democratic military is in place, however, the contras should not be forced to disband. They remain the single most effective lever to ensure that the Sandinistas respect the will of the people of Nicaragua. Instead of becoming a party to the demands of those who seek the immediate liquidation of the resistance as a fighting force, the United States should make it clear that the contras will continue to receive funding for humanitarian and resettlement purposes at present levels until such time as the Chamorro government has been fully empowered in accordance with its mandate and the new national army created. At that point, both the resistance and Sandinista forces should be disarmed under the supervision of the IADB.

    •  

  • The United States should take the lead in creating an international support group for Nicaragua (modeled after that organized to assist Guyana) consisting of the United States, Japan, Venezuela, Mexico and the International Monetary Fund, the World Bank and the Inter-American Development Bank. This group would work with the new Nicaraguan government to develop and support a multi-year economic recovery plan.

    •  

  • As part of this recovery program, the United States should seek to revive the Central American Common Market and the Central American Bank for Economic Integration. These institutions — which foundered due to Sandinista policies in the early 1980s — are urgently needed to stimulate intra-regional trade and economic growth.

    •  

  • The United States should foster democratic institutions in Nicaragua by promoting contacts between U.S. (and, possibly, Costa Rican and Venezuelan) industry, labor, educational groups, health care specialists and agricultural experts. One example of such an effort can be found in the contacts now taking place between such American organizations and reformist groups in Eastern Europe. In addition, planning to renew Food for Peace aid to Nicaragua should begin at once.

    •  

  • The United States should bring Nicaragua into the Caribbean Basin Initiative and the attendant preferential tariff treatment.

 

Democracy’s spectacular victory in Nicaragua has amply demonstrated the wish of the Nicaraguan people completely to repudiate the Sandinistas and their policies. It should be no part of America’s role now to urge Mrs. Chamorro to compromise her mandate or share it with the Sandinistas. Instead, the United States must encourage through every means at its disposal the full empowerment of Mrs. Chamorro’s government and the realization of the promise of peace and freedom offered by her election. Only by so doing can this country help ensure that genuine democracy takes root and prevails in Nicaragua.

1. One indication of the magnitude of Sandinista abuse of the electoral process may be found in the results of a preliminary review and statistical analysis of the Nicaraguan registration rolls conducted Borge and Associates of Costa Rica. Of roughly 70,000 names examined to date, approximately one in ten was a duplicate. This suggests that the Sandinista vote total may have been inflated by as much as ten percent (i.e., closer to a 60-30 split).

2. Interestingly, Somoza’s National Guard never exceeded 10,000 men under arms compared to the roughly 80,000 active duty forces currently comprising the Sandinista party army.