In a highly anticipated recent speech, Space Exploration Technologies (SpaceX) founder Elon Musk announced his plan to send people to Mars. After his presentation, Musk received a question from a member of the audience, who asked, “You’re going interplanetary, but you’re not going international. When are you going to hire people from other countries than the U.S.?”
At the heart of the answer to this question is a byzantine U.S. export control system—the International Traffic in Arms Regulations (ITAR)—which hinders domestic space companies from hiring useful foreign talent.
ITAR has long been a headache for commercial space industries. During the Cold War space race, the United States classified space-related products as munitions. While the end of the Cold War saw easing of restrictions, the loss of two satellites on Chinese launches in 1995 and 1996 saw Congress place space technologies back under tight control. Because some of the rocket technology used for space launch can also be used to develop intercontinental ballistic missiles, export controls have remained strict.
But ITAR is not just about physical products. Sharing information can also be considered an export. This is why hiring foreigners is so problematic for companies like SpaceX. Compliance costs associated with bringing in foreign workers, and then ensuring they are not given highly controlled information, are just too high. This problem is not restricted to private industry. NASA recently had to take down a study on its website because of concerns that it contained information controlled by ITAR. But the controls create pronounced difficulties for U.S. space companies. Compliance can cost them business, restrict the ability to hire the best talent, and constrain even internal sharing of information.
When the Bureau of Industry and Security (within the Department of Commerce) polled industry members about export controls, respondents highlighted numerous areas in which controls had negative effects on business. Many of the respondents indicated that they did not fully understand the rules, and lost business to foreign firms over the costs customers had to pay to comply with the laws. Some foreign companies specifically advertise that they can provide products or services without the costs of complying with America’s ITAR system. This means that export controls damage American companies’ competitiveness, even in areas where the capabilities are already globally available.
There are convincing national security reasons to maintain some control over space technology, given the connection between space launch rockets and more destructive uses of the technology. However, the U.S. government itself has admitted that the system can be improved, especially given the changes in global availability of some of the technology. There are ongoing reforms to space-related export controls, but it is not clear what effects they will have on global competitiveness. Some industry members have said that the changes have made the entire process more complicated rather than less. In a hearing before the House Small Business Committee, witnesses from the two regulating agencies—the Department of State and the Department of Commerce—agreed that the system could be made simpler by consolidating management in a single agency.
Until the export control issue is resolved, American companies will likely have to continue to go it alone. Presently, with the increase in space venture capitalism and government support for commercialized outer space, companies like SpaceX may not be too negatively affected. However, rising competition abroad may force the issue sooner than later.
The United States no longer has a monopoly on outer space. If America wants to keep its domestic space industry competitive, it will have to attract the best and brightest from around the world. Until then, entrepreneurs like Elon Musk will have to reply to would-be foreign employees with the same unsatisfactory answer he provided to his questioner: “I really wish we could do more, it’s just, our hands are tied.”