DoD Eases Security Rules for Foreign Workers

Date: Monday, August 21, 2006 5:50 PM

<<<<< JOB DESTRUCTION NEWSLETTER No. 1544 -- 08/21/2006 >>>>>

One thing I hear from people over and over is a variation on the following
theme: "I'm going to get a job that requires a security clearance because
there is no way an H-1B will ever be allowed to work on secure government
contracts". That may have been true once, but as you will see, the
Department of Defense gave the green light for foreigners to work on secure
contracts -- and unlike you, they won't even be required to wear security
badges!

I recommend that you skip the rest of my commentary until you have read the
Boston Globe article because that will help you understand the big picture
first. Come back to this point to continue your reading for further
details on what this all means and why.

In 2005 universities and military contractors lobbied to sellout our
national security in the name of reducing the "burdens" of doing business.
The second article in this newsletter has more on the lobby effort. Also
read:

http://www.aaas.org/news/releases/2004/0512visa.shtml
Leading Science, Higher-Education and Engineering Groups Urge Six
Improvements to U.S. Visa-Processing Quagmire

and this newsletter:
http://www.zazona.com/shameh1b/JobDestructionNews2004.htm
2004-05-23 Shortage of PhDs Scientists and Engineers

When I read the recent Boston Globe article titled "Defense Dept. won't
segregate foreign staffers" the first thing I did is to hunt down a few
government documents to either verify of disprove what was written (the
article seemed so far-fetched I thought I could easily discredit the
newspaper). My conclusion is that the Boston Globe article is very accurate
but incomplete.

The first document to view is the actual DoD rule changes. It's a huge
document, so allow me to highlight some of its worst sections (the
following analysis is not complete as there are plenty more foul sections
if you want to plod through the entire document.

http://www.acq.osd.mil/dpap/dars/dfars/changenotice/2006/20060814/E6-13290.htm
[Federal Register: August 14, 2006 (Volume 71, Number 156)]
[Proposed Rules]
[Page 46434-46440]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr14au06-32]

COMMENT FROM ROB: The DoD explained why they are loosening the security
regulations for foreign workers. Read this gobbledegook very carefully,
because what they are really saying is that the DoD doesn't have the
capability of knowing which documents are classified, and which aren't, so
instead of restricting documents, they will allow foreigners to be able to
have access to everything! I used to work on secret government contracts
and was subjected to continuous security checks, but of course that was in
the 1980s when the term "classified" really meant something. This is a
stunning admission by the DoD that they can no longer maintain secure
documents.

1. Boundaries of the Proposed Rule

a. Comment. Directly or indirectly, one hundred and thirteen

respondents recommended against adopting the proposed rule. This
negative feedback came primarily from the educational research
community.

DoD Response. DoD recognizes the respondents' concerns, and the

proposed rule has been substantially re-written in a way that addresses
many of the concerns, including those expressed by the research
community. The impetus for creating the rule was a Department of
Defense Inspector General (DoDIG) audit report which found that some
contractors granted foreign nationals access to unclassified export-
controlled technology without proper authorization. The DoDIG concluded
that the Department does not have adequate processes to identify
unclassified export-controlled information or technology, nor to
prevent unauthorized disclosure to foreign nationals by its
contractors. Based on these findings, DoD believes appropriate changes
to regulations or procedures are warranted.

COMMENT FROM ROB: The DoD has a simple justification for using foreign
workers. In their opinion foreign workers are smarter and of course it just
follows that we will not be able to maintain military superiority without
them. It's the old "dumb-lazy-American, smart-hard-working-foreigner"
argument.

2. Foreign Participation in U.S. Federally-Sponsored Research Projects

a. Comment. Fifty-six respondents asserted that the proposed rule

would harm national security. These respondents asserted that foreign
scientists and researchers add more to the U.S. research enterprise
than they take away. In some fields, foreign researchers are ahead of
their U.S. counterparts. Restricting participation in DoD-funded
research may deprive the United States of capabilities that result in
essential contributions to maintaining U.S. military superiority.

COMMENT FROM ROB: The DoD came to the conclusion that maintaining security
is just too much of a burden on military contractors. When I worked on
military contracts in the 1980s security was just considered part of the
cost of doing business. That of course is old-school thinking. Now the
government's mission is remove these costly and inconvenient burdens from
contractors. Pay particular attention to the documents called ITAR and EAR
- I will explain why later.

3. Administrative Burden and Cost-Effectiveness of Proposed Solutions
to the Underlying Export Control Issues

a. Comment. Forty-four respondents expressed concerns about the

additional administrative burden of the proposed rule. These
respondents asserted that the proposed rule appeared to mandate
compliance system requirements beyond those required in the ITAR and
the EAR.

DoD Response. DoD recognizes this concern, and appropriate

revisions have been made to the rule. This second proposed rule
requires contractors to comply with their responsibilities under the
ITAR and the EAR when export-controlled information or technology will
be generated or accessed in the performance of the contract.

b. Comment. Ninety-two respondents expressed concern with the

requirement to issue badges to research participants.

DoD Response. As noted in the responses to comments 1.b., 1.h., and

2.g., the proposed rule has been changed to eliminate separate DoD
requirements on export control compliance programs, and instead
includes references to the Department of State for the ITAR and the
Department of Commerce for the EAR. The Department of State and the
Department of Commerce have responsibility for overseeing compliance
with ITAR and EAR requirements.

c. Comment. Six respondents asserted that the proposed rule would

impose a training burden.

DoD Response. The rule was not intended to place unique DoD

compliance burdens on the contractor. Therefore, the specific language
related to training has been removed.

d. Comment. Two respondents expressed concerns related to the

rule's impact on access to research equipment that is export-
controlled.

DoD Response. Since the proposed rule is focused on reminding

contractors of their responsibility to comply with the ITAR and the
EAR, access to research equipment is considered to be outside the scope
of this proposed rule. DoD recommends that the respondents refer
concerns on this matter to the Department of Commerce or the Department
of State, as appropriate.

COMMENT FROM ROB: Just to make sure there is no confusion about what types
of research is being talked about here, I copied this section of text which
explains what types of research foreign workers will have access to.

REQUIREMENTS REGARDING ACCESS TO EXPORT-CONTROLLED INFORMATION OR
TECHNOLOGY--FUNDAMENTAL RESEARCH (XXX 2006)

(a) Definitions. As used in this clause--
Applied research means the effort that--
(1) Normally follows basic research, but may not be severable

from the related basic research;

(2) Attempts to determine and exploit the potential of

scientific discoveries or improvements in technology, materials,
processes, methods, devices, or techniques; and

(3) Attempts to advance the state of the art.
Basic research means that research directed toward increasing

knowledge in science. The primary aim of basic research is a fuller
knowledge or understanding of the subject under study, rather than
any practical application of that knowledge.

Export-controlled information and technology means information

and technology subject to export controls established in the Export
Administration Regulations (15 CFR parts 730-774) or the
International Traffic in Arms Regulations (22 CFR parts 120-130).

[[Page 46440]]

Fundamental research, as defined by National Security Decision

Directive 189, means basic and applied research in science and
engineering, the results of which ordinarily are published and
shared broadly within the scientific community. This is
distinguished from proprietary research and from industrial
development, design, production, and product utilization, the
results of which ordinarily are restricted for proprietary or
national security reasons.

COMMENT FROM ROB: When I worked on government contracts, every document was
classified as non-confidential, company proprietary, confidential, secret,
or top secret. Engineers and other workers never had a question how
documents were classifed, who had access to them, and there was no doubt
which areas were secured because they were all locked and there were large
warning signs that unauthorized were not to enter. Personnel without secure
clearances were never allowed in areas with these documents or in places
with related equipment - even janitors had to have security clearances. Now
the DoD has decided that contractors don't have to "segregate" foreign
workers from any of the secure areas. That would have never happened in the
past, but of course that was before politically correct-think made the word
"segregate" a dirty word.

[[Page 46437]]

g. Comment. Sixty-three respondents objected to segregated work

areas.

DoD Response. As noted in the responses to comments 1.b. and 1.h.,

the proposed rule has been changed to eliminate separate DoD
requirements on export control compliance programs, and instead
includes references to the Department of State for the ITAR and the
Department of Commerce for the EAR. Thus, a specific DoD requirement
for segregated work areas has been removed from the proposed rule.

[[Page 46437]]

g. Comment. Sixty-three respondents objected to segregated work

areas.

DoD Response. As noted in the responses to comments 1.b. and 1.h.,

COMMENT FROM ROB: The following section is probably the most important as
far as this newsletter is concerned because it defines what foreign workers
will get a free ride on security. It's not an impressive section of text
upon first reading, but note the references to the ITAR and EAR documents.

[[Page 46437]]

export controlled information or technology or classified information
is involved). However, DoD believes that mandating this notification
for all contracts is unnecessary.

d. Comment. Ten respondents were concerned that the proposed rule

used the terms ``foreign national'' and ``foreign person,'' but did not
define these terms.

DoD Response. In response to this comment, the proposed rule has

been revised to refer to the ITAR and the EAR for applicable
definitions.

COMMENT FROM ROB: So here it is folks, the infamous ITAR document. If that
first sentence about "natural person" doesn't set your alarm bells off,
then you just haven't been paying attention!

http://www.pmdtc.org/docs/itar/itar_part_120.pdf
The International Traffic in Arms Regulations (ITAR)

' 120.16 Foreign person.
Foreign persons means any natural person who is not a lawful
permanent resident as defined by 8 U.S.C. 1101(a)(20) or who is
not a protected individual as defined by 8 U.S.C. 1324b(a)(3).
It also means any foreign corporation, business association,
partnership, trust, society or any other entity or group that is
not incorporated or organized to do business in the United States,
as well as international organizations, foreign governments and
any agency or subdivision of foreign governments (e.g. diplomatic

missions).

COMMENT FROM ROB: The EAR "Export Regulations Administration" uses the term
"natural person in many places. They define the term on this page:

http://www.access.gpo.gov/bis/ear/txt/772.txt

Person. A natural person, including a citizen or national of the
United States or of any foreign country; any firm; any government,
government agency, government department, or government
commission; any labor union; any fraternal or social organization;
and any other association or organization whether or not organized
for profit. This definition does not apply to part 760 of the
EAR (Restrictive Trade Practices or Boycotts).

CONCLUDING COMMENT FROM ROB: The reference to natural persons is very
significant once you know what the term means. Use of this phrase is a very
important clue that the DoD is tying our security decisions with our
international trade agreements. This mundane sounding paragraph is truly
revolutionary!

To go further you must understand what the term "natural person" means.
It's a term that is defined by the WTO and GATS in Mode 4 - the "Movement
of natural persons". Mode 4 covers all international workers -- especially
those that use visas such as H-1B, L-1, TN, and J-1.

http://www.wto.org/english/tratop_e/serv_e/mouvement_persons_e/mouvement_persons_e.htm

Movement of natural persons refers to the entry
and temporary stay of persons for the purpose of
providing a service. It does not relate to persons
seeking citizenship, permanent employment or permanent
residence in a country.

For further reading on "natural persons" and Mode 4, click this link:

http://www.thesocialcontract.com/cgi-bin/showarticle.pl?articleID=1201&terms=

Let's go back and look at Section #3 to fully understand what the DoD is
really up to:

the proposed rule has been changed to eliminate separate DoD
requirements on export control compliance programs, and instead
includes references to the Department of State for the ITAR and the
Department of Commerce for the EAR. The Department of State and the
Department of Commerce have responsibility for overseeing compliance
with ITAR and EAR requirements.

It appears that the DoD is using administrative procedures to force the
Pentagon to comply with WTO free-trade mandates! That is a gross violation
of our national security and sovereignty.

If all of this makes sense to you, here is something that will connect a
few more dots:
http://www.channelingreality.com/The_Coup/admin_coup.htm
Administrative Coup d'Etat

+++++++++++++++++++++++++++++++++++++++++++++++++++

http://www.boston.com/business/technology/articles/2006/08/16/defense_dept_wont_segregate_foreign_staffers/

Defense Dept. won't segregate foreign staffers

US universities, business opposed the security plan

By Bloomberg News | August 16, 2006

WASHINGTON -- The Pentagon won't require badges and segregated areas for
foreigners working on high-security contracts, citing opposition from US
companies and universities.

``National security, as it relates to research and development, involves a
balancing act," the Department of Defense said. ``The first proposed rule
was overly prescriptive."

The Pentagon proposed the security restrictions in July 2005, after its
inspector general warned that some contractors were giving foreigners
unauthorized access to technologies that are unclassified yet would be
subject to export restrictions if sent overseas.

Three months ago, the Commerce Department made a similar decision and
instead agreed to form a commission to study the issue of foreigners
working in US laboratories.

``Everyone's trying to get it right, and I think that's what this is all
about," said George Scalise, president of the Semiconductor Industry
Association.

A Bush administration study last year concluded that more than 90 countries
were using corporate contacts, scientists, and foreign students to obtain
sensitive US technology.

But university and business leaders argued that the restrictions would mean
millions of dollars in losses from direct compliance costs and untold more
from discouraging critically needed foreign scientific expertise.

The new proposed rule would make clear that contracts must comply with
existing export rules, while eliminating suggested requirements in such
areas as badges and segregated work areas. The Pentagon said it will take
comments through Oct. 12.

The new proposal is an acceptable means of making contractors aware of
their obligations, said Tobin Smith, senior federal relations officer at
the Association of American Universities, whose members include Harvard and
Yale.

+++++++++++++++++++++++++++++++++++++++++++++++++++

http://www.insidehighered.com/news/2005/07/18/dod

July 18, 2005

Badges and Segregation
Foreign researchers working on certain kinds of sensitive research under
military contracts could face tough new limits on their activities under
rules proposed by the Pentagon.

The rules cover military research contracts in sensitive areas and include
requirements for several new measures for foreign nationals -- such as
special badges and segregated work areas -- that worry many universities,
who find these measures excessive and potentially offensive to the many
foreign students who work in American university laboratories.

The Association of American Universities, in a memo urging its members to
send the Pentagon objections to the proposal, said that the rules could
easily spread beyond areas where there may be any security concern. "The
proposal fails to reference the fundamental research exemption for
universities, which exempts them from applying for export licenses for a
majority of their research," the AAU memo said. (Export controls are one of
the mechanisms by which federal agencies designate certain research as
requiring higher levels of scrutiny.)

Further, the AAU noted that many universities are already experiencing
"significant problems" with "troublesome clauses" in Pentagon research
contracts. The association fears that, if the new rules are adopted, the
Pentagons program managers will include the "overly restrictive
language" in many contracts not even covered by the proposed regulation.

The Pentagon proposal characterized the rules not as a dramatic change, but
as "clarifications of existing responsibilities."

The proposed Pentagon policy comes shortly after a Commerce Department
proposal to increase requirements for universities doing research with
foreign nationals that is covered by export controls. Several academic
groups have objected to those proposals, saying that they apply to far too
much research that poses no security issues and that the proposals for
foreign nationals go too far.

For instance, the American Association for the Advancement of Science asked
why universities, under the proposal, would be required to determine
foreign nationals country of birth in addition to their citizenship. A
letter from the AAAS to the department questioned whether that idea "would
pass judicial scrutiny," and called it "overly burdensome and unnecessary."

-- Scott Jaschik

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