Doni Bloomfield (Fordham University School of Law) and Jeff Gordon (Vanderbilt University – Vanderbilt Law School) have posted The New Export-Control Equilibrium (Fordham Law Legal Studies Research Paper No. 6634758) on SSRN. Here is the abstract:
Export controls are a central legal tool in the United States’ geopolitical competition with China. U.S. export controls regulate far more than their name suggests. They restrict the flow of goods, services, and ideas around the world. In 2021 alone, the U.S. government considered license requests for more than $1.4 trillion in exports. Yet legal scholarship has largely neglected export controls, viewing them as anomalous vestiges of the Cold War. We fill this gap with the first comprehensive theory of export controls in the legal literature. Export controls serve a clear purpose: securing U.S. relative technological advantage over rivals. Export controls can only achieve this goal, however, if they rest on three pillars. They must be cost-justified, imposing greater costs on rivals than they do on friendly firms; they must be stable, backed by a political coalition that allows continuous enforcement over time; and they must be comprehensive, achieving these goals globally, not just in the United States. We apply this framework across three historical eras, from the Cold War to the present, and arrive at a diagnosis. Export controls were designed for the political economy of the Cold War but struggle to succeed in the political economy of today. During the Cold War, export controls stood in a stable equilibrium. Federal research spending justified the costs of losing export markets; it created a coalition to support consistent export policy; and U.S. allies were united in denying the USSR leading technology. But today, this equilibrium is broken. Export controls tax the entities on which U.S. preeminence relies, political support for export controls is unstable, and U.S. export-control alliances are fraying. This diagnosis allows us to identify a new approach to securing U.S. technological advantage. Our proposal restores each of the three pillars of export-control efficacy. We propose using research subsidies to offset export controls’ increased cost, a regulatory compact between the government and industry to counter export controls’ increased instability, and support for firms in allied countries to maintain export controls’ comprehensiveness. The equilibrium of the twentieth century cannot be resurrected. We must construct a new export-control equilibrium to take its place.
Highly recommended. The three-pillars framework—cost-justification, stability, and comprehensiveness—gives the article real analytic traction, and the diachronic application across three regulatory eras turns the diagnosis into something close to a structural theory of when export-control regimes succeed or fail. A timely and ambitious gap-filling contribution at the intersection of national security law, administrative law, and the political economy of regulation.
Lawrence Solum