THE SOVIETS AND THE U.S. HIGH TECHNOLOGY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP88-01070R000100030002-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 12
• Document Creation Date: December 20, 2016
• Document Release Date: May 16, 2007
• Sequence Number: 2
• Publication Date: January 5, 1982
• Content Type: OPEN SOURCE

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RADIO TV REPORTS, INC.
4701 WILLARD AVENUE, CHEVY CHASE, MARYLAND 20015 656-4068
PROGRAM The MacNeil/Lehrer Report STATION WETA TV
PBS Network
DATE January 5, 1982 7:30 PM CITY Washington, DC
SUBJECT The Soviets and the U.S. High Technology
ROBERT MACNEIL: Years ago, Lenin put it this way: "The
capitalistic economy plants the seeds of its own destruction, in
that it diffuses technology and industry, thereby undermining its
own position." Today, Lenin's heirs are actively stealing Amer-
ican technology, and the United States Government is trying to
stop them.
MACNEIL: When President Reagan banned high technology
sales to the Soviet Union last week, he was doing more than pun-
ishing Moscow for Poland. It was a further move to stop what the
Administration believes is a leakage dangerous to the national
security. By legal means, espionage and theft, Communist coun-
tries have been steadily acquiring the latest electronic techno-
logy. The government is trying to tighten up security at elec-
tronic plants in California, where thefts of computer chips have
reached what some call epidemic proportions.
Some of the microprocessor chips have been traced to
East Bloc nations, which could use them to upgrade both civilian
computers and military hardware.
More controversially, the Administration is trying to
keep Communist scientists away from the latest technological ad-
vances by refusing them access to scientific meetings and restric-
ting their activities at universities. Those efforts have raised
a storm of protest from academics, who claim they not only violate
academic freedom, but will slow down U.S. research.
Tonight, can an open society stop the Soviets from ac-
quiring its technology, and how important is it to do so, anyway?
OFFICES IN: WASHINGTON D.C. ? NEW YORK ? LOS ANGELES ? CHICAGO ? DETROIT ? AND OTHER PRINCIPAL CITIES
Material supplied by Radio N Reports, Inc. may be used for file and reference purposes only. It may not be reproduced. sold or publicly demonstrated or e ibited.
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JIM LEHRER: Robin, there are two major nests of Soviet
Bloc spies in the United States. Nest number one, obviously, is
here in Washington, where KGB agents work under diplomatic cover
as everything from chauffeurs to high-level diplomats at the
Soviet and Eastern European embassies. Their job is to gather
information on the U.S. Government, using both overt and covert
means.
The second big nest, not so obviously, is in the San
Francisco region of Northern California. They're there because
of the nearby area known as Silicon Valley, a 30-mile stretch
from Menlo Park to San Jose where more than 1500 high technology
companies are located, companies that use a lot of silicon making
microcomputer chips. Thus the name Silicon Valley. But more
importantly, companies working on technological secrets the Soviet
Union wants. Thus, according to U.S. officials quoted in a recent
Newsweek magazine, there are some 100 Soviet agents, many of them
the cream of the KGB corps and trained in technology and engin-
eering, stationed at the Soviet consulate in San Francisco. Their
job is to acquire those technological secrets for the Soviet
Union; here again, by both overt and covert means.
There aren't many people around who know very much about
how the KGB goes about its business, and even fewer who can talk
publicly. One of those few is Harry Ros:ta'rzke, a CIA specialist
on the KGB for 25 years, now retired, the author of a recent book
on the subject, "The KGB: The Eyes of Russia."
First, on the list of KGB priorities in this country,
how important is the gathering of high technology.
HARRY ROSITZKE: You could probably safely say that 80
to 85 percent of the KGB work, not only in Washington and San
Francisco, but in New York, is concentrated on one or another
form of, let's call it, industrial espionage. This could be both
civilian and military technology.
LEHRER: What kinds of things, in general terms, are
they looking for?
ROSITZKE: If you look at the last 30 years, they cover
almost every aspect of American industrial, technical and scien-
tific work, with specific focus on those parts of our knowledge
which they lack. There is in Moscow a scientific and technical
directorate inside the KGB that's almost a human data bank. They
know everything about every industrial process that is known
there, and know what they need to know. In other words, they're
the people who direct the KGB people abroad in terms of what kind
of man to look for, what kind of information to get.
LEHRER: They send out a shopping list, you mean, a
regular shopping list?
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ROSITZKE: It's partly that, but it's also a central
point. If you're up in New York or in San Francisco and meet
a man of some interest and get on a personal level with him, you
get ahold of Moscow and say, "What do you want from this fellow?"
In other words, you can't have 150 top-level Soviet scientific
experts sitting around the United States. So you have a great
many people with a scientific and engineering background who then
use this data bank back in Moscow to fill in the holes in Soviet
knowledge.
LEHRER: What kinds of techniques does the KGB use to
gather this information? You mentioned just a moment ago cozying
up to somebody on a personal level. Is that how they do it, or
what else?
ROSITZKE: The first stage to recruit an agent, of
course, is get to know him, to see whether or not he's suscepti-
ble. They can get at the information they want through a defense
worker, through a laboratory technician, through a corporate
junior executive. And in all the cases I know of -- and this
goes on in Germany and abroad, as well as here -- it's usually
strictly for money. And somewhere along the line, if they find
the right people, they will be able to get them to bring out,
usually on microfilm, whatever blueprints, whatever documents
they want. And, of course, in some cases, like the silicon busi-
ness, they'd love to have some samples.
LEHRER: Well, a lot of this information is just already
available, is it not? The kind of information -- I mean just in
the open market.
ROSITZKE: I suppose someone has said 98 percent of
everything we know is available either in terms of trade fairs,
aviation journals, etcetera. But it's that last two, three, four
percent the KGB concentrates on.
They do collect everything they can, because they're
knowledgeable. But where they really carry out their main task
is to find the man who has access to the data that's denied them.
LEHRER: Is it possible to judge the effectiveness of
the KGB operation in acquiring this kind of information, that
final two percent?
ROSITZKE: I suppose what you'd have to say is that
after they've been at this all these years and they still have
most of their people working at it, they certainly are earning
their salaries.
Now, to decide how much this information back in Moscow
is worth, let us say, to the Soviet technicians, scientists, et-
cetera, that's a pretty difficult one. Because one contrast to
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be made: when they buy a piece of technology, like a full plant,
Fiat plant, or a German-French truck factory, there it is and it
works. But all these pieces of information that come in there,
that go into their informational computers; but when they actually
have an effect upon the production process in the Soviet Union,
that would be a question mark.
So we're not talking about an immediate effect of a
series of small reports coming from, let us say, a dozen American
scientists.
LEHRER: Well, what I mean was, have they been effective
getting the information? How they use it, I understand what you're
saying. That's another...
ROSITZKE: I don't think there's any question about it.
LEHRER: It's working, huh?
ROSITZKE: Well, all the way from Eastman Kodak in the
'30s, when they stoke the color process, to today, when they're
in some of our space centers, when they're in a great many of our
defense plants, and when they are, as you say, really deep into
Silicon Valley.
LEHRER: Thank you.
MACNEIL: Now the view of a man with experience in manu-
facturing high technology, and who also deals with the issue of
restricting its export. He is Harry Sello, Executive Vice Presi-
dent of Stanford Scientific Incorporated, a firm which designs
computer circuits and consumer products. He's also Chairman of
the International Committee of the American Electronics Associ-
ation. Its members include many firms in Silicon Valley. And
Dr. Sello's committee deals with restrictions on exporting high
technology. He's with us tonight in the studios of public station
KQED, San Francisco.
Dr. Seller -- Sello, in your firm, are you conscious of
having had the attention of any of these espionage activities?
HARRY SELLO: Well, I'm not so conscious of these acti-
vities in the particular firm I'm with now, because I've only
been there rather recently, and it is a small firm. But because
of the two decades of worth that I've spent in Silicon Valley,
and many of them with a well-known firm there, Fairchild Camera
and Instrument, I am very conscious of this kind of problem, as
are many of my colleagues and many of our associates. We are
aware of this. Yes.
MACNEIL: Is the risk of it or the extent of it being
exaggerated?
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SELLO: That's a subject I find very hard to answer.
The difficulty with trying to keep a secret is that when you
have a secret, it's yours. But when you don't have it, it's all
gone. So all you need to do is lose one.
SELLO: I just can't assess the degree to which this
has been lost.
You see, we're a very highly proprietary bunch out in
Silicon Valley. We're very competitive. We like to think...
MACNEIL: You're trying to keep your secrets from each
other, as well as from...
SELLO: Yes, sir. And some of our competitors are right
next door or across the street. So we think we're well versed in
the idea of keeping secrets. However, one must exercise vigilance
at all times.
So, to answer your question, I don't really -- I can't
really evaluate just how much has gone out.
Turning to the question of restricting exports of high
technology, particulary to the Communist world. Are you in favor
of such restrictions?
SELLO: Yes, I am, provided these restrictions are very
carefully defined and understood by those who have to use them;
and, even more importantly, used uniformly by all who have those
problems. And by that I mean by us in the United States and by
our equally well-versed allies and our associate friends abroad.
MACNEIL: What happens if the restrictions are not too
strictly defined, or are too broadly defined?
SELLO: Well, we in high technology have lived for many
years in an area where our Export Control Act applies. We're
well aware of restrictions. We work with them. We do our usual
things, apply for licenses, as we need to.
Well, while many of these things are well defined, it's
a long and laborious procedure, for example, to do this. So you
have to judge, is it worthwhile going through such a procedure?
MACNEIL: Isn't it the case that many of these -- this
high technology has dual applications, some of them very innocent,
like in electronic games, and some quite highly sensitive and
potentially having military significance?
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SELLO: A very telling point, Mr. MacNeil, one that's
been giving us fits in industry for a long time -- a long time in
our industry could mean even just the last two to three years, or
five or so -- and it presents a problem to us: namely, the fact
that the same kind of circuits can go into a toy as can go into
some sort of a military-oriented application, a large computer,
for example.
But that doesn't mean that we can't define it. It means
it must be done, and it can be done, but caref u l l y .
MACNEIL: Can you stop KGB agents from sending Atari
games back to their headquarters in Moscow? Or is that too silly?
SELLO: I don't see how that particular restriction can
be applied.
MACNEIL: In some games, like the ones that have become
terribly popular just this season, for instance, is some of the
technology in those games similar to the technology you're talking
about, in terms of the microcircuits and so on?
SELLO: Yes, it is. But you must remember that techno-
logy is a thing that's embodied, I think the right term is, in
the silicon chip itself. So while you can get a fairly good idea --
if you're knowledgeable, you can get a fairly good idea of how the
thing is put together, you have to really work at it in order to
pull the technology out from the chip.
MACNEIL: Do you think, finally, that it is realistic
to think that we can actually restrict access to this kind of stuff
in an open society?
SELLO: Oh, that's a very tough question. If you're
talking about KGB access, if that's what we're talking about --
or let's talk about the illegal access -- even though we think
we all try our damndest to obey the law, there are always people
who are ready to circumvent, and for a price, as Mr. Rositzke
mentioned. So that the threat of deviation or stealing or piracy
is always there.
MACNEIL: Well, thank you.
LEHRER: The Reagan Administration, through the Com-
merce Department, is pushing for tighter restrictions on the
dissemination of technology and information about it to Soviet
Bloc countries. One of its strongest advocates for tightening
up is Lawrence Brady, Assistant Secretary of Commerce for Trade
Administration.
What, in brief, is your argument for more restrictions?
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ASSISTANT SECRETARY OF COMMERCE LAWRENCE BRADY: We
think when you look back over what's happened over the last 10
years -- and we have done that in the first six to eight months
of this Administration -- we see that what we exported, legally,
commercially, and what was acquired illegally by the Soviets
complement themselves to such an extent that what the Soviets
got from the West was technology, equipment that has drastically
helped their military-industrial complex. And what this Admin-
istration is saying now is that we've got -- now that we've taken
a look at the system and how it worked, or how it failed, we've
got to take a look and see how we can better control the techno-
logy. Not necessarily broaden the controls, because, frankly,
based on the discussion that just took place, it's true there
are some sophisticated chips in some of these toys. What we want
to do is to address the design, manufacturing, production tech-
nology. In other words, preclude the Soviets, or at least delay
the Soviets from acquiring the manufacturing, the turnkey plant
that conveys technology in its real sense.
LEHRER: Can it be defined, carefully defined and under-
stood, to use Dr. Sello's term?
SECRETARY BRADY: I think we can do it. I think we're
making progress in doing it. We have had in the government in
the last four or five years an exercise called the Military Cri-
tical Technologies Exercise, where we tried to take a look and
to see what technology, technical data, know-how -- not necessarily
equipment per se -- is the most critical to the military-industrial
complex. And I think we're making headway.
We've got nine defense priority industries -- computers,
microelectronics, chemicals, shipbuilding -- that are critical to
a modern military machine in the Soviet Union.
LEHRER: But what about the question of some of the
things -- as Robin asked a moment ago, that some of these things
that are used in toys could be used in a military way as well.
That's a real problem, as Dr. Selo said, for his industry. How
you answer that problem?
SECRETARY BRADY: The things that are used in toys are
the chips. And frankly, they're the items that you can walk into
any computer store in this country and buy off the shelf for five-
ten bucks. And what we're saying, as a matter of fact, is that
we should devote the government's resources to the technology to
make those chips rather than to the chips themselves. In other
words, if the Soviets really want to acquire that chip, they're
going to go into a store and buy it for $5. They're not going to
buy the video game for 150.
LEHRER: What about restrictions on scientific exchange,
particularly at the research level, at universities and that sort
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of thing, between U.S. scientists and Soviet Bloc scientists?
Do you want restrictions on that as well?
SECRETARY BRADY: We want to take a very hard look at
what has taken place. We have done that. We know that there
has been a loss of technology, of know-how through those exchan-
ges. We know that the Soviets acquire, both commercially and
illegally, the technology, on the one hand. They Sovietize it,
which means they try to apply it to the particular Soviet oper-
ation. The link sometimes is difficult to make. In other words,
how do you Sovietize it? And sometimes they need help from in-
dividuals in the United States to do that, or at least they have
to come to us for help. And that's where the academic and stu-
dent exchanges come in.
And what we've got to prevent is the conveying of that
knowledge that helps them reach a point in their research and
development effort, or even their design, manufacturing and pro-
duction effort, that would take them years to get there, and
many dollars.
LEHRER: Can you do that without infringing on academic
freedom and that sort of thing?
SECRETARY BRADY: Well, we think we can. We don't --
we have no intention of, obviously, trying to infringe upon aca-
demic freedom or the ability of university professors to teach
the courses they want to teach. But when you have foreign stu-
dents coming into this country, it is a right which we are giving
them. And I think that right can be conditioned, to the extent
that when they're here, they not be given the technology which
will undermine our efforts and help, in essence, the Soviets'
effort -- the Soviet efforts in the military area.
LEHRER: Thank you.
MACNEIL: Last February, the presidents of five pres-
tigious American universities wrote to the government protesting
about what they saw as attempts to restrict academic freedom in
the name of national security. The letter was written by Donald
Kennedy, President of Stanford, a distinguished biologist and
former Commissioner of the Food and Drug Administration under
President Carter. Dr. Kennedy is also with us in San Francisco.
First of all, what prompted your letter to the Secre-
taries of State, Defense and Commerce last year?
DONALD KENNEDY: Well, as a consequence of the evolu-
tion of the application of these export controls from things to
ideas, we confronted a series of inquiries from not only Mr.
Brady's department, but from some others, regarding foreign
nationals in U.S. universities, requests to keep track of them,
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requests to restrict attendance at scientific symposia and meet-
ings, and things of that sort.
What concerns us is that in their application to funda-
mental research, which is what goes on in universities like Stan-
ford, what is going to happen is that an attempt which in other
ways may be entirely legitimate to preserve U.S. technological
leadership becomes, in fact, a stifling influence on the conduct
of an entire scientific enterprise, most of which is based in
the universities.
I'm really concerned with academic freedom than I am
with the health of a very important enterprise which deals not
in process technologies, but in fundamental science.
KENNEDY: Well, I think that...
MACNEIL: I mean if your secure within your university,
exchanging ideas and going on with your research, how does it
stifle it to kind of limit how much of that is given out?
KENNEDY: It's not a question of limiting what's given
out. It's a question of limiting what goes on inside. We've had
actual requests from Commerce and from other departments to change
the shape of what goes on internally, to restrict access by our
own graduate students to research projects that take place within
the university. So that's what we're talking about.
MACNEIL: Do you think it is appropriate for universi-
ties to attempt to restrict the activities of foreign students
and their access to certain courses or classes or professors?
KENNEDY: I don't think you can conduct a research and
training activity on that basis, Mr. MacNeil. I think it compro-
mises the entire style of inquiry. It compromises some very
basic principles of research training. And there are other ways
of achieving the same goals. If the technology becomes so impor-
tant militarily that it needs restriction, the governmetn can
classify it. And then universities can decide whether or not
they wish to do it.
MACNEIL: How do you assess the government's degree of
concern about this? I mean have they got it right? Are they
right to be as worried as they are about it, do you think?
KENNEDY: In the things are, they may very well be
right. In the research area, I think they're being overzealous.
But we can sit down and talk about it with them, and indeed we
have.
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I think that the costs to the scientific enterprise,
just to repeat, of intervening in the way they have from time to
time proposed to intervene during the past year, I think those
effects will be negative. And that's what prompted the letter
to which you referred at the beginning.
MACNEIL: Do you believe that there are some areas of
technology which should be, and in fact can be, kept secret?
KENNEDY: I think that those should meet the test of
requiring national security classification. That's a test that
we have at hand. It can be put in place to deal with these
problems.
MACNEIL: And short of that, you shouldn't be asked
to restrict access to these things, you mean.
KENNEDY: That's right. I think that the cost to the
enterprise, the scientific enterprise, will be substantially
greater than whatever restrictions you could actually accomplish
in export.
MACNEIL: Well, thank you.
LEHRER: Secretary Brady, how do you respond to that,
in terms of the cost?
SECRETARY BRADY: Well, I don't know precisely what
he's talking about when he says cost. What we're talking about
are a handful of students, basically, from the Soviet Union and
some of the East European countries who are, for the most part,
graduate students in the United States.
Let me tell you of a Soviet graduate student in the
United States. He has the equivalent of a Ph.D. He's between
33-35 years old. And he's vastly unlike, he or she is vastly
unlike the student that we send to the Soviet Union or to Eastern
Europe, normally a poetry or history major.
LEHRER: You're suggesting that it's KGB people?
SECRETARY BRADY: Well, I'm suggesting not only that.
I'm suggesting that they are here for a particular purpose. The
Soviets do not spend their hard-earned currency needlessly.
Whenever they buy, whenever they allow someone to travel in the
West, it is for a very specific reason.
LEHRER: Well, why not just keep those people out of
the country?
SECRETARY BRADY: Well, that's one of the -- that's one
of the ways of dealing with this question. One of the problems
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with that is that it is difficult, with an open society, to close
its borders. We may not grant a student a visa, but a third coun-
try may. And he may be able to come in the country illegally.
LEHRER: Dr. Kennedy, back to you on the question of
cost. You heard what the Secretary says. We're talking about a
handful of people that are clearly identified, etcetera. What's
the problem in...
KENNEDY: I'm relieved that that's all Mr. Brady is
worried about. As he himself says, he can deal with that per-
fectly comfortably through visa regulation. And, in fact, we
don't need what they're proposing. Not a single one of the
Commerce Department requests or inquiries of a university in
the past year that is known to me and led to our letter involved
a Soviet exchange student. Not one.
SECRETARY BRADY: No, but one of them involved a sym-
posia or a conference on bubble memory, which...
LEHRER: On bubble memory?
SECRETARY BRADY: On bubble memory in the computer
development area, which is an area that's of very real concern
to the United States as far as the next generation of technology.
One of the...
LEHRER: And you requested that Soviet people, Soviet
Bloc people not be allowed to attend.
SECRETARY BRADY: I believe that was the request. It's
some months ago and...
LEHRER: Is that the one that bothered you, Dr. Kennedy?
KENNEDY: That's one of the ones that was referred to
incidentally in the letter. I don't think it's the one of main
concern. I'm much more concerned about requests to follow the
activities of and to restrict access of visiting scholars and
graduate students from a variety of foreign nations; and, in
some cases, to delay publication of results that come from clearly
fundamental and unclassified research. Those are the sorts of
problems that worry me a great deal more.
SECRETARY BRADY: Yeah, but let me tell you a couple of
the problems we had. We found out that a graduate student from
one of the East European countries was over here studying fuel-
to-air explosives under a professor who was under contract to the
Navy. When the student transferred from the United States, he
went back to his East European homeland and began working in the
precise area in which we had taught him.
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So that our concerns are not without very solid founda-
LEHRER: Harry Rositzke, what's your view of this, on
how this kind of thing could and should be restricted?
ROSITKE: Well, I think probably the first mistake we
make, though, is that this is strictly a matter for American
control. If we look at the entire problem, we have to include
Western Europe, and certainly German and Japanese industry. And
one of the easiest ways to get materiel out, as you know, is
through the transshipment business, which the KGB is in. Let
any good West European firm with a KGB contact buy anything
they want in this country on the export control list, get it
over there -- and this has happened to silicon chips as well --
and they simply transship it from Rotterdam to Warsaw or from
Vienna to Moscow.
So, to that extent, we're not limited in terms of our
own shores.
Now, on the second point, the academic. I think that
is, as an old academic, a terribly hard one to control, and I'm
not sure it would have that much of an effect.
One thing the KGB is very good at -- and there have
been several cases -- of recruiting American and West European
students abroad, paying their entire college education, the B.A.,
getting them into the States, paying for their Ph.D. Most of
them are in the hard sciences. And several I know of have gotten
jobs in, shall we say, defense industries.
Well now, they can't do this by the hundreds. But we're
still talking about an external control without being able to con-
trol the internal.
LEHRER: Mr. Secretary?
SECRETARY BRADY: The question that you raised about
Western Europe is a good -- is a good point. However, I would
draw again the distinction between equipment, which can be diver-
ted, technology, which is more difficult to divert to a third
party; it can be acquired illegally easily.
LEHRER: With that distinction drawn, we have to go.
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