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Nuclear News - 01/15/02
RANSAC Nuclear News, January 15, 2002
Compiled by David Smigielski

A. Cooperative Threat Reduction
    1. Nuclear Weapons Subtraction, The New York Times (01/12/02)
B. U.S.-Russia HEU Purchase Agreement
    1. Turning Arms Into Energy, If Not Into Much Cash, Daniel Gross, The New York Times (01/13/02)
C. Russia-U.S.
    1. Nuclear Shell Game, The Boston Globe (01/14/02)
    2. With U.S. Blessing, Russia Gives Fragile Ukraine A Hand (Excerpted), Ian Fisher, The New York Times (01/13/02)
    3. A New Nuclear Policy With Old Flaws, Steve Chapman, The Chicago Tribune (01/13/02)
    4. Russia Seeks New Arms Pact With U.S., Associated Press (01/12/02)
D. Russia-Iran
    1. U.S., Israel Plan Talks on Russia, Reuters (01/15/02)
    2. How Politics Helped Redefine Threat, Michael Dobbs, The Washington Post (01/14/02)
    3. A Story Of Iran's Quest for Power, Michael Dobbs, The Washington Post (01/13/02)
    4. Collapse Of Soviet Union Proved Boon To Iranian Missile Program, Michael Dobbs, The Washington Post (01/13/02)
E. Russia-Burma
    1. Burma Announces Nuclear Plans, Larry Jagan, BBC (01/11/02)

A. Cooperative Threat Reduction

Nuclear Weapons Subtraction
The New York Times
January 12, 2002
(for personal use only)

The Bush administration has finally come to appreciate the nationalsecurity dividends paid by a relatively inexpensive set of programsdesigned to help Russia dismantle its cold-war nuclear weapons andsecure its bomb-grade plutonium and uranium from theft or sale to roguenations or terrorists. With the threat of nuclear terrorism growing andMoscow now proposing to remove thousands more warheads from its nucleararsenal, these programs - known collectively as Nunn-Lugar for the twolegislators who helped originate them a decade ago, Senators Sam Nunnand Richard Lugar - are more urgently needed than ever.

Last year the White House unwisely sought to slash spending forNunn-Lugar programs. Fortunately, Congress restored all of those cutsand more in the aftermath of the Sept. 11 terrorist attacks. This year'sadministration requests will be far more generous, incorporating most ofthe increases added by Congress last fall.

Most Nunn-Lugar programs are run by the Department of Energy, with therest administered by either the Pentagon or the State Department. Theamount sought for the Energy Department will be $1.04 billion, 37percent higher than last year's request. Precise numbers requested forthe State and Pentagon programs are not known, but they too will besubstantially higher. In part, the administration's more enlightenedapproach reflects the newly cooperative relationship between Washingtonand Moscow that has developed since the terrorist attacks. Patientpersuasion by senators and representatives of both parties also helped.

While some individual Nunn-Lugar programs have suffered from pooradministration, their overall achievement has been undeniablyimpressive. For a total of less than $7 billion since 1991, Washingtonhas helped finance not only the deactivation of more than 5,500 nuclearwarheads from Russia and other former Soviet republics, but also theemployment of Russian nuclear scientists who might otherwise have soldtheir services to Saddam Hussein or Osama bin Laden, as well as somebadly needed tightening of security at Russian plutonium and bomb-gradeuranium storage facilities. Nunn- Lugar money has also been used tobegin dismantling Russia's biological weapons plants. Much more needs tobe done, especially in the area of accounting for and protectingplutonium and uranium, which remain vulnerable to diversion or theft.Much of the increased funding the administration plans to request isrightly targeted at addressing this continuing danger.

The White House would be wise to apply the spirit of the Nunn-Lugarprograms to the thousands of weapons in America's own nuclear arsenalthat are no longer needed. Most of these warheads have no foreseeableuse, and, given current capacities for computer simulation and physicalsampling, there is no pressing reason to resume nuclear test explosions.The safest future for excess cold-war nuclear bombs, both Russian andAmerican, is to dismantle them and render the plutonium and uranium theycontain unsuitable for military use.
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B. U.S.-Russia HEU Purchase Agreement

Turning Arms Into Energy, If Not Into Much Cash
Daniel Gross
The New York Times
January 13, 2002
(for personal use only)

When it went public in July 1998, the United States EnrichmentCorporation was a bright light in the nuclear energy industry.

The company, a former government agency, had a monopoly on uraniumenrichment in the United States and was responsible for carrying out agovernment policy to convert Russia's military uranium into commercialnuclear fuel. USEC, as the company is known, had annual sales of $1.4billion, healthy profits and a promising future technology. It appearedto be an ambitious experiment in harnessing private sector energy tomeet a public policy goal. "The beauty of the program is that it disarmsformer weapons of mass destruction, and it does it through a mechanismthat only works if you have a market price," said Robert J. Moore,USEC's general counsel.

But while the company has turned swords into plowshares, it has had farless success spinning its common shares into gold.

In the last two years, it has mothballed one of its two uranium fuelplants, reduced its work force by 40 percent, halved its dividend andbecome embroiled in a bitter trade dispute with its chief Europeancompetitors. Its stock is at $7.16, about half the offering price of$14.25.

Now its prospects may hinge on an International Trade Commission ruling,due on Friday, on whether the company's European rivals sell uraniumfuel in the United States at unfairly low prices.

USEC, based in Bethesda, Md., is not speculating publicly about thetrade commission's decision. Henry Z. Shelton Jr., the chief financialofficer, would say only that "having fair prices in the United States isvery important to USEC's financial status, but also to our ability tomake investments."

USEC occupies a unique niche in nuclear power, as a former federalagency owned by shareholders. Some critics say its problems show afailure to adjust from running a government bureaucracy that served acaptive, regulated market to managing an independent company in anindustry dominated by nimble, unregulated customers.

"They came into this clubby nuclear world and were very aggressive,"said Matthew Bunn, assistant director of the science, technology, andpublic policy program at Harvard's John F. Kennedy School of Government."They have few friends."

USEC sells chemically "enriched" uranium, which the company producesdomestically and buys from Russia, for use as fuel to nuclear powerplants. It has dozens of customers in 10 countries, holds a 70 percentmarket share in Asia and about half the market in the United States,where 103 nuclear plants operate.

The company's origins lie in the end of the cold war in the early1990's, when the federal government created the "Megatons to Megawatts"program that pays Russia cash for uranium fuel made from its dismantlednuclear warheads. USEC was designated as the government's sole executiveagent, the exclusive buyer and marketer of the Russian uranium. Since1995, it has paid Russia more than $2 billion for fuel derived from 130metric tons of weapons-grade enriched uranium - enough to arm 5,600warheads; USEC is obliged to buy fuel derived from a total of 500 metrictons by 2013.

As the bull market raged, USEC emerged as a prime candidate forprivatization. In July 1998, the government raised $1.4 billion byselling shares. "We were enamored with the possibility that this was acompany that possessed a vital link with government, which wouldcertainly limit the downside risk," said David M. Schanzer, an analystat Janney Montgomery Scott, which helped to underwrite the offering.

Within a year, the outlook darkened.

USEC had inherited long-term contracts with utility companies - pactsdrafted in the 1980's, when uranium prices were high. As those contractsexpired, newly deregulated utility companies like Exelon (news/quote)and Duke Energy (news/quote) sought cheaper fuel. They bought from twoaggressive European companies - Urenco, owned by the British and Dutchgovernments and two German utilities, and the French-owned Eurodif. "Themarkets became more open and more competitive," said James P. Malone,vice president for nuclear fuel at Exelon.

The competition depressed the price of the fuel, measured in separativework units, or S.W.U.'s. The price went from $90 per S.W.U. in 1997 to$79 in 2000. USEC accused European competitors of illegally sellingbelow cost in the United States, called dumping, and of benefitingunfairly from government subsidies. "The market price started todeteriorate substantially coincident with a substantial increase in theorders taken in the U.S. market by European suppliers," said RichardCunningham, a lawyer at Steptoe & Johnson, who represents USEC. "This isthe classic situation in which you find dumping."

The declining price was disastrous for USEC because it was locked intoan agreement with Russia to buy 5.5 million S.W.U.'s of fuel - abouthalf of the company's annual sales - at fixed prices that rose annuallyfrom a 1997 base.

The company also stumbled in betting on a promising laser technology toupgrade its plants, in Portsmouth, Ohio, and Paducah, Ky. The technologyfailed in commercial tests, and USEC abandoned it in June 1999, angeringinvestors. "We were repeatedly informed that in fact this was going tobe the next great technological development," said Mr. Schanzer atJanney Montgomery.

Struggling with excess capacity and credit ratings that had fallen tojunk-bond level, USEC tried to close the Portsmouth plant. That moveangered the plant workers' union and local politicians, and some calledfor the government to reassume control of the company. By the spring of2001, USEC suspended uranium enrichment at Portsmouth, part of a biggercut that reduced its staff, research and dividend.

The company also found its freedom constrained by government ties. Itreached a tentative agreement with Russia on a new uranium price in May2000 but approval was delayed by the Clinton and Bush administrations.Last Nov. 26, the Bush administration authorized negotiations for a newprice agreement.

USEC's biggest problem, though, is foreign competition. In December2000, the Commerce Department agreed to investigate the company'sEuropean rivals.

During the investigation, USEC showed that from June 2000 to June 2001,its North American market share plummeted to 47 percent from 73 percentand its world share to 29 percent from 35 percent. Revenue slumped to$1.14 billion in the fiscal year ended June 30, from $1.49 billion theprevious year. Net income, excluding special items and inventoryvaluation, fell to $41.1 million from $109.1 million. Critics say thecompany should blame itself. "It has old technology and the highestcosts in a market that is oversupplied," said Thomas L. Neff, a seniorscientist at the Massachusetts Institute of Technology, who came up withthe Megatons to Megawatts idea but opposed the privatization of USEC.

The competitors' lawyers contend that the company still benefitsunfairly from its former status as federal agency. "USEC is a hugebeneficiary of subsidies received from the government of the UnitedStates," said David E. Birenbaum, a partner at Fried, Frank, Harris,Shriver & Jacobson, who represents Urenco. "It has very low rent on itsplants."

USEC won partial victories last May, July and December in CommerceDepartment rulings that Urenco and Eurodif were selling fuel at unfairlylow prices. The department ordered a 34.16 percent duty on the Frenchimports and 7.07 percent duty on the British. The International TradeCommission is scheduled to vote on Friday on whether those penalties arejustified.

Although the Commerce Department rulings were preliminary, they helpedto push up uranium prices to $105 per S.W.U. The company's stock, whilestill nowhere near its offering price, did rise 66 percent in 2001.Nonetheless, the company is not making much money at its basic business.

Some critics say there is a fundamental conflict between serving USEC'sshareholders and carrying out the Megatons to Megawatts agreement. Thecompany must sign a deal with Russia regardless of the market price ofuranium, so "the Russians can take a much harder negotiatingposition,"said Dan M. Collier, senior vice president at NACInternational, a nuclear energy consulting firm in Atlanta.

William H. Timbers, USEC's chief executive, said there was no conflict."The early perceived `tension' between these two interests has dissolvedto where the success of the national security deal is now integral toour commercial success," he said. "Critics said it couldn't be done butwe did it."
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C. Russia-U.S.

Nuclear Shell Game
The Boston Globe
January 14, 2002
(for personal use only)

With the release of an unclassified version of its Nuclear PostureReview, the Bush administration risks making the United States look likea shifty salesman performing a classic bait-and-switch.

During his campaign, President Bush professed a determination to scuttlethe old nuclear doctrines of the Cold War. Accordingly, he promised toslash the 6,000 nuclear warheads permitted in the START I treaty by asmuch as two-thirds and also to remove those weapons of mass destructionfrom their hair-trigger alert. This promised a sensible and long-overdueadjustment to the security needs of the contemporary world.

The version of the Nuclear Posture Review made public last week andcomments on it by Defense Department officials suggest, however, thatmany of the warheads to be decommissioned by the administration willremain in what the Pentagon calls ''responsive capability.'' In otherwords, they will be removed from missiles, but instead of beingdestroyed, they will be held in reserve in case new threats requiretheir redeployment.

If it turns out to be something more than an aggressive opening gambitin arms-control negotiations with Moscow, this shell game with nuclearwarheads will make Bush's campaign promises look like artful or cynicalfibs.

As was to be expected, Russia reacted in the tone of a party thatbelieves it may have been deceived. A foreign ministry spokesmancomplained, sensibly, that Russia wants anticipated nuclear armsreductions to be ''irreversible, so that strategic defensive arms willbe reduced not only `on paper.'''

The underlying reality is that President Vladimir Putin's governmentcannot afford to maintain its nuclear arsenal at START I levels. Notonly do Putin's negotiators know this; their American counterparts knowit as well.

Nonetheless, the United States gains no advantage from its ability toafford the cost of maintaining a large stockpile of decommissionedwarheads. On the contrary, America stands to lose quite a lot byobliging Russia to match its own folly and maintain thousands ofwarheads in a reserve status.

The risk - and it is all too real - is that some of those superfluouswarheads may be stolen by or sold to terrorists like Osama bin Laden ora criminal holding state power such as Saddam Hussein.

Another dangerous element of the Nuclear Posture Review is its proposalto spend $15 million on technology and personnel that would enable thePentagon to resume, faster than it now can, underground nuclear tests.

For the sake of American security and a working partnership with Russia,Bush should agree to destroy decommissioned warheads before his summitthis spring with Putin, and he should also abjure Pentagon plans torevive nuclear weapons testing.
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With U.S. Blessing, Russia Gives Fragile Ukraine A Hand (Excerpted)
Ian Fisher
New York Times
January 13, 2002
(for personal use only)

In the last decade, the United States pumped more than $2 billion intoUkraine, the huge and puzzled nation hinged to Russia's western edge.This was not just to be nice: Ukraine had nuclear weapons, the stillreal threat of Chernobyl and 50 million people who could steer theirfragile new nation toward Europe or drift back into Russia's embrace.

Now the nuclear arms are gone. The Chernobyl nuclear plant is shut. ButUkraine's relations with Russia seem warmer than ever: at a recentsummit meeting in this big industrial city about 25 miles from theRussian border, the flags of both nations waved together on frozenstreets as the two presidents - Leonid D. Kuchma of Ukraine and VladimirV. Putin of Russia - once again pledged friendship and tighter businessties.

Not so long ago this warming might have caused alarm in Washington, asign that its influence in Eastern Europe was slipping. But a changingcalculus between West and East, marked by far better relations betweenRussia and America themselves, seems to be depriving Ukraine of some ofits geo-appeal.

American officials sound unconcerned, casting Ukraine and Russia aspartners in reform leading toward European standards of business andgovernance. "We see no contradictions between Ukraine's `Europeanchoice' and stable, normal relations with Russia," said Carlos Pascual,the American ambassador to Ukraine. "Ukraine can - and should - pursueboth. A stable, confident and reforming Ukraine would be the kind ofneighbor that could encourage a reform minded Russia on its owntransition path. The obverse is likewise true."


At the summit meeting here, Mr. Putin said Russia and Ukraine shouldcoordinate their efforts to join the World Trade Organization. They alsodiscussed having Ukraine use Russian technology and financing to finishtwo nuclear reactors to replace Chernobyl, a deal in which Ukraine mightwalk away from a long-planned financing arrangement with Westernnations.
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A New Nuclear Policy With Old Flaws
Steve Chapman
The Chicago Tribune
January 13, 2002
(for personal use only)

It wouldn't be hard to make the world safer by getting rid of a coupleof thousand nuclear warheads, any of which could vaporize entire citiesfull of people. But it takes some doing to eliminate all that killingpower and make the world less safe. That's the strange achievementpromised by the Bush administration's new policy.

During his recent summit with Russian President Vladimir Putin,President Bush said the United States would cut its arsenal from 6,000warheads to no more than 2,200 over the next decade, and Putin promisedto go as low or lower. The Nuclear Posture Review issued by the Pentagonlast week is the first big step in that direction. It calls for removingabout 2,200 warheads from missiles that can reach Russian soil. This issupposed to confirm Bush's campaign declaration: "Our mutual securityneed no longer depend on a nuclear balance of terror."

Well, two nations that are each pointing hundreds of unimaginablydestructive missiles at each other can still instill plenty of terror.And we won't even reach those supposedly negligible levels of weaponryuntil 2012. Downsizing the superpower arsenals and minimizing the chanceof nuclear war are sound goals--sound enough to deserve a better programthan this. Instead of making things better, the new approach would makethem worse.

How? First of all, by making cuts that aren't really cuts. Many of thewarheads would not be destroyed but simply put in storage for some rainyday when we might need them--or, as the Pentagon puts it, keeping "someresponsive capability that we could respond to unforeseencontingencies."

There's nothing wrong with that, until you consider that if we take someof the weapons we're getting rid of and put them in storage, theRussians will do the same thing. The greatest nuclear peril posed by theRussians is not that they will launch a missile attack. It's that someof their bombs or nuclear material might find their way into the handsof terrorists.

Moving these weapons from silos, where they are extremely secure, towarehouses, where they may not be, would be a gift to Al Qaeda and everyother outlaw group that lusts after Russia's "loose nukes." If we wantto reduce the danger, we have to persuade the Russians to destroynuclear weapons so that no one can ever use them. But they won't do thatunless we agree to do the same.

The administration boasts that it has put Cold War thinking behind useven as it clings to the old way of doing things. One major example isthat we (and the Russians) still keep our missiles on a hair trigger. Ifwe have a "completely new relationship with Russia," as the Pentagondeclares, why do we need to be able to incinerate the place in less timethan it takes to watch the evening news?

The basis of nuclear deterrence, after all, is not that we can strikeour enemies first. It's that if any country attacks us with nukes, wecan turn its entire territory into radioactive rubble. Whether thattakes half an hour or half a day could not possibly matter less.

Dealerting missiles on both sides, in a verifiable way, would create acushion of hours or even days, so that neither side can take a hasty andill-informed leap into nuclear war. "That's the single most importantthing we could do, in any area, to improve the security of the UnitedStates," says John Steinbruner, a nuclear strategy expert at theUniversity of Maryland. But the most important thing we could do is notbeing done.

This failure is not the only way in which Bush is exposing Americans tounnecessary peril. Another is suggesting that we may go back to nucleartesting. The first President Bush agreed in 1992 to stop such tests, andBill Clinton stuck by that. But now, the Defense Department wants moneyto speed up any possible resumption.

No country in the world has less reason to conduct nuclear tests thanthe U.S., simply because we have done more of them than anyone else. Aban on all tests would serve the selfish purpose of preserving Americannuclear superiority, in quality as well as quantity.

Imagine if there were a law banning all new soft-drink formulas. Whowould be put at a disadvantage? Not the big beverage-makers, butfledgling companies hoping to compete with them. In the nuclear arena,the U.S. is bigger than Coke and Pepsi combined. Why would we want togive upstart nations the chance to learn everything we know?

But grasping that point means overcoming the rigid dogmas of the ColdWar. Bush campaigned on the need for a whole new approach to nuclearstrategy. Maybe someday he'll provide it.
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Russia Seeks New Arms Pact With U.S.
Associated Press
January 12, 2002
(for personal use only)

Russia expects a formal accord with the United States on deep nuclearweapons cuts to be reached by May or June, a Russian general leadingtalks with U.S. officials next week said Saturday.

``The central issue of the Washington consultations will be thedevelopment of a new agreement between Russia and the U.S. on thereduction of strategic offensive arms,'' Col. Gen. Yuri Baluyevsky toldreporters in Moscow, according to Russian news agencies.

The agreement should be ready by the time President Bush (news - websites) visits Russia in late May or early June, said Baluyevsky.

``It should be a legally binding document what will clearly outline themechanism of controlling the process of reduction,'' he said.

Bush pledged in November to cut the U.S. arsenal to 1,700-2,200warheads, and Russian President Vladimir Putin (news - web sites)responded by saying Russia would reduce its stockpile to 1,500 warheads.Each country is now allowed 6,000 nuclear warheads under the 1991 STARTI treaty.

Putin has pushed for a formal treaty on the new cuts, but Bush hasbalked.

In a reconciliation gesture, a senior U.S. official said Thursday thatthe Bush administration would be willing to codify cutbacks with astatement or even a treaty, provided there would be no tortuous ColdWar-style negotiations.

Baluyevsky heads a delegation going to Washington to work out details ofthe cuts Monday and Tuesday, and the talks are expected to be tough.Russia has bristled at the Pentagon (news - web sites)'s plan todownsize American nuclear arsenals by putting weapons in reserve ratherthan destroying them.

Baluyevsky said the U.S. decision to withdraw from the 1972Anti-Ballistic Missile Treaty would also be discussed.

After years of Russian efforts to prevent such a move, Bush announced inDecember that the United States is withdrawing from the treaty withinsix months so that it can build a national missile defense.

Putin called the decision a mistake but said it would not threatenRussia's security. Baluyevsky said that Russia would present a formalreaction to the U.S. withdrawal within six months.
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D. Russia-Iran

U.S., Israel Plan Talks on Russia
January 15, 2002
(for personal use only)

The United States and Israel will discuss concerns about Russia's rolein Iran's nuclear and missile programs when Undersecretary of State JohnR. Bolton travels to Israel this week, according to U.S. officials.

Bolton, who oversees arms control and international security affairs,will meet key Israeli officials, including Dan Meridor, nationalsecurity aide to Prime Minister Ariel Sharon.

A U.S. official said Bolton's talks in Israel would include an "exchangeof information about what the Iranians are up to, what we know, whatthey know."

The two allies are expected to share and "coordinate" what each istelling the Russians on these issues.

"The Russians know we're talking to the Israelis. It's a good way toshow to the Russians that we are serious about the issue," the officialadded.
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How Politics Helped Redefine Threat
Michael Dobbs
Washington Post
January 14, 2002
(for personal use only)

Until 1998, it was an article of faith for the U.S. intelligencecommunity that no potentially hostile country -- apart from Russia orChina -- would pose a long-range missile threat to the United Statesbefore 2010, at the earliest.

Scarcely a year later, CIA analysts were saying something entirelydifferent. They predicted that North Korea, one of the world's lastsurviving hard-line Communist states, could test an intercontinentalballistic missile capable of hitting U.S. territory "at any time."According to a September 1999 intelligence forecast, Iran could testsuch a missile "in the next few years."

This abrupt shift in thinking was prompted, in part, by a series oftroubling events, including missile tests in North Korea and Iran,nuclear tests in India and Pakistan, and reports of Russian scientistsselling their services to the highest bidder.

But there is also evidence that the new intelligence forecasts were theresult of something else: a concerted campaign by theRepublican-dominated Congress, supported by Israel, to focus attentionon the leakage of missile technology from Russia to Iran. The governmentof then Prime Minister Binyamin Netanyahu feared that Israel could soonbecome a target of Iranian missiles. Congressional Republicans wanted tobuild public support for a national missile defense system.

"It was the largest turnaround ever in the history of the [intelligence]agency, and I was part of making it happen," said Rep. Curt Weldon(R-Pa.), a leading critic of what he often called the Clintonadministration's "misguided" approach to Russia in the late 1990s.Weldon, a champion of missile defense, was openly scornful of pre-1999CIA estimates of the missile threat from states such as Iran and NorthKorea.

Weldon and other conservatives said the intelligence shift was anecessary corrective to what they viewed as politically skewedintelligence forecasts during the Clinton years. They were particularlyupset by a 1995 national intelligence estimate that flatly stated that"no country, other than the major declared nuclear powers, will developor otherwise acquire a ballistic missile in the next 15 years that couldthreaten the contiguous 48 states and Canada."

By contrast, Joseph Cirincione, director of the nonproliferation programat the Carnegie Endowment for International Peace, said the 1995intelligence estimate "holds up pretty well in hindsight." He accusedWeldon and other Republicans of mounting a "conscious politicalstrategy" to attack the intelligence assessment because "it stood in theway of a passionate belief in missile defense." As a result, he said,the intelligence process has become politicized.

"Intelligence analysts have learned to give the Congress what they want,while preserving the integrity of the analysis," said Cirincione, aformer Democratic staffer on Capitol Hill. "What happens is that you getassessments that include all possible worst cases."

CIA officials argue that the post-1998 estimates are the result of"improved tradecraft." They say the agency reviewed its proceduresfollowing publication of a 1998 report on the ballistic missile threatby a bipartisan commission headed by a former (and future) defensesecretary, Donald H. Rumsfeld, and began to consult a wide range ofindependent experts from industry and academia.

Some consumers of intelligence within the government say the shiftingforecasts of the ballistic missile threat are a case study of how anostensibly objective intelligence process can be buffeted by conflictingpolitical pressures, from home and abroad.

"Nobody believes the CIA estimates," said a longtimecounter-proliferation expert from another government department. Anotheranalyst said that "nuances" tend to get taken out of the estimates asthey proceed up the bureaucratic ladder. "The job of the CIA is to warn,but they never back down from previous warnings," the analyst said.

A Congressman's Battle

The argument over the 1995 intelligence estimate got underway evenbefore its publication. According to Capitol Hill sources, the Clintonadministration leaked details of the still-secret document tocongressional Democrats, who used it to argue the case against missiledefense.

As chairman of the House Armed Services Committee's subcommittee onmilitary research and development, Weldon assumed responsibility forcountering the Democratic offensive. He did so by staging a dramaticshowdown with a CIA analyst, David Osias, who had been dispatched toCapitol Hill to give him and other committee members a briefing on theintelligence finding in a secure fourth-floor conference room.

Weldon said he "went ballistic" after Osias insisted that there would beno hostile missile threat to the continental United States for at least15 years. "I said, 'Do you mean to tell me that the unrest in Russiarepresents no additional threat?' " The congressman said he was alsofurious that the CIA study excluded Alaska and Hawaii from its threatassessment. (A North Korean missile would have to travel nearly 6,000miles to hit California, but only 3,700 miles to hit Alaska.)

"This is over, this is [expletive], this is a politicized process,"Weldon recalled yelling, before bringing down the gavel on theclosed-door session. Intelligence sources confirmed that Osias wassubjected to a severe grilling at the secret hearing.

The debate over the 1995 estimate coincided with an aggressive Israelicampaign to alert the Clinton administration to what Netanyahu adviserssaw as a growing missile threat from Iran, a radical Islamic state thathas often threatened to destroy Israel. Israel had information that Iranwas working on a scaled-up Soviet Scud missile, known as the Shahab-3,that would theoretically be able to hit Tel Aviv from launching pads inwestern Iran.

Israel had intelligence that Russian missile experts were traveling toTehran and giving advice to the Iranians. Former Israeli officials saidthey were greeted with skepticism from Clinton administration officialswho were reluctant to strain relations with Russian President BorisYeltsin, then seen in Washington as the symbol of Moscow's fledglingdemocracy.

"It was as if the Americans did not want to know the facts, or the factswere too embarrassing for them to confront," said Uzi Arad, a formerintelligence adviser to Netanyahu.

The Israeli allegations of technology transfers between Moscow andTehran became the basis of a series of congressional hearings in 1997and 1998, and Republican calls for economic sanctions against any statethat provided missile technology to Iran. The confrontation came to ahead in June 1998 when the Republican-dominated Congress passed the IranMissile Proliferation Sanctions Act, which would have imposed mandatorysanctions on any country selling missile technology to Iran. Thelegislation was promptly vetoed by President Bill Clinton.

Administration officials scrambled to enlist Israeli support to getCongress to back down and accept a diluted version of the legislation,rather than override the president's veto.

"The administration's rationale was that it was up to the Israelis toget the genie back into the bottle since they had let it out in thefirst place," said a Republican staffer, describing how Israel persuadedHouse Speaker Newt Gingrich (R-Ga.) to go along with White House wishes.

Against their own judgment, congressional conservatives allowed thepresidential veto to stand. But they would soon acquire fresh ammunitionin their campaign against the 1995 intelligence estimate.

'Mass Conversion' at CIA

The first serious attempt by congressional Republicans to persuade theCIA to revise its estimate of the long-range missile threat ended infailure. A blue-ribbon panel headed by former CIA director Robert M.Gates reported to Congress in December 1996 that the technical caseagainst "rogue states" acquiring intercontinental ballistic missiles, orICBMs, in the foreseeable future was even "stronger" than that presentedin 1995.

Unhappy with the conclusions of the Gates committee, Congress appointeda new commission, this one headed by Rumsfeld. The Rumsfeld report --delivered in July 1998 -- turned out to be much more alarmist than the1995 estimate. The Rumsfeld report predicted that a rogue state would beable to "inflict major destruction" on the United States "within aboutfive years" of a decision to develop an ICBM. For several of thoseyears, the report added, "the U.S. might not be aware that such adecision had been made."

According to commission members, the five-year estimate was basedlargely on briefings from missile engineers at major U.S. defensecontractors, including Lockheed Martin and Boeing. The commission askedthe American rocket builders how long it would take them to build anICBM, from the starting point of a Third World country such as Iran."The answer was five years or less than five years," recalled BarryBlechman, chairman of the Henry L. Stimson Center, a researchorganization in Washington.

Rumsfeld accused the CIA of committing the sin of "mirror-imaging" inits earlier estimates: the notion that "just because it took us 10, 12years to do something, it is likely to take others that long or longer."In fact, he insisted, it would probably take other countries less timeto develop ICBMs, as much of the relevant information was alreadyavailable.

By framing the question to U.S. missile experts in a novel way, theRumsfeld Commission avoided the mistake of assuming that a country suchas North Korea would necessarily follow the same path to an ICBM as theUnited States or Russia. But critics argue that the commission mighthave fallen into a mirror-imaging trap of its own: the assumption thatan isolated Third World country has the same access to missilecomponents and missile technology as a major U.S. defense contractor.

"I don't believe that the Rumsfeld Commission made a serious analysis ofthe industrial base needed to develop long-range missiles," saidTheodore A. Postol, a professor of missile technology and nationalsecurity policy at the Massachusetts Institute of Technology. "Ofcourse, American contractors will tell you that building an ICBM iseasy. But these are people who live in an incredibly rich industrialenvironment. A Third World country faces an entirely different set ofproblems."

The political impact of the Rumsfeld report was strengthened by the factthat its conclusions were unanimous. The Democrats had been allowed toappoint three members of the nine-member panel, so it was difficult forthem to argue that the report was politically tainted. The Democrats'experts included Blechman and Richard L. Garwin, a leading nuclearphysicist strongly opposed to missile defense on technical andscientific grounds.

Garwin and Blechman said they were struck by the way in which countriessuch as North Korea, Iran and Pakistan were pooling their resources andtaking advantage of existing know-how. Since the beginning of the Bushadministration last year, and Rumsfeld's reappointment as defensesecretary, the conclusions of the Rumsfeld Commission have been elevatedto quasi-doctrinal status within the government, according to severalofficials.

"Nobody dares say a word against Rumsfeld, at least in public," said onegovernment nonproliferation expert. Another spoke of a "mass conversion"within the CIA, even among analysts who were predicting somethingentirely different just a few years before.

Even so, the Rumsfeld Commission's conclusions remain highlycontroversial, even within the government. The State Department'sintelligence unit, the Bureau of Intelligence and Research, has longtaken a less alarmist view of North Korean and Iranian capabilities thanhas the CIA or the Pentagon. A new national intelligence estimate on themissile threat, issued this month, publicly enshrined the StateDepartment's dissenting views for the first time, officials said, eventhough the declassified version referred only to an unnamed "agency."

The new estimate also acknowledged what outside experts have longmaintained: Rogue states or terrorist groups are unlikely to usemissiles as their method of choice for delivering weapons of massdestruction. The estimate said that "covert delivery methods," such as aship or a civilian airplane, were cheaper and more reliable thanballistic missiles.

The idea that a country such as Iran or even Libya could be well on itsway to deploying an ICBM -- as opposed to a short- or medium-rangemissile -- without the United States knowing about it strikes manyoutside experts as absurd.

"Iran is trying to achieve a credible regional capability," said aFrench Foreign Ministry official. "A more long-range program is a matterof speculation. They say they want a satellite launch capability, but wedon't see them putting much effort into it."

Rumsfeld Commission members continue to defend their conclusions. "Wenever said anything about states deploying ICBMs by a certain date, wejust said they would be capable of doing it," said Blechman, who notesthat the U.S. intelligence community failed to predict a huge Sovietnuclear arms buildup in the 1960s under Leonid Brezhnev.

'Golf Ball of Destruction'

The Rumsfeld Commission report led U.S. intelligence experts toreconsider the very nature of an intercontinental-range ballisticmissile. Before 1998, they had thought of ICBMs as similar to theweapons possessed by the United States and the Soviet Union:sophisticated, powerful and highly accurate missiles that could behidden in silos and launched at a moment's notice.

The new definition of an ICBM, as conceived by the Rumsfeld Commissionand embraced by the CIA, covers virtually any rocket capable of landinga warhead, however small, somewhere on U.S. soil, at least in theory.Under the new definition, North Korea already has ICBM capabilityagainst the United States because it possesses a rocket that could,conceivably, land a tiny warhead somewhere in Alaska.

The North Korean Taepodong-1 is a three-stage rocket, tested for thefirst (and so far only) time on Aug. 31, 1998, soon after the release ofthe Rumsfeld report. According to U.S. intelligence officials, the firststage was a No Dong, the North Korean version of a scaled-up Scud B. Thesecond stage was the North Korean equivalent of a Scud B. The thirdstage consisted of a small, solid-fuel rocket probably acquired fromPakistan or China, carrying little more than a radio transmitter.

This unwieldy contraption was the missile equivalent of the "Hail Marypass," according to David Wright, a senior analyst for the Union ofConcerned Scientists. Although the third stage exploded and the missileflew no more than 1,000 miles, the launch demonstrated that North Koreamight soon have the capability of putting a satellite into orbit.

The elastic nature of what exactly constitutes an ICBM has caused someskeptics within the government to joke about what they call "the golfball of destruction."

"There is an idea out there that if you can land anything on Americanterritory, the result will be vast devastation. That is simply nottrue," said a government expert at odds with the official CIA line.

The skeptics argue that the North Koreans have a long way to go beforetheir missiles pose a real threat to the United States. First, they haveto develop a rocket that actually works. Second, they need a warheadthat will not burn up when it reenters Earth's atmosphere. Third, theyhave to develop rockets powerful enough to deliver a militarilysignificant payload. And fourth, they need to mate the missile to anuclear or biological warhead.

Many experts believe that a chemical or biological attack on the UnitedStates using a crude Taepodong-type rocket can be excluded because suchweapons must be delivered with a high degree of precision to beeffective. Nuclear warheads can be less accurate, but are much heavierthan chemical or biological weapons, meaning that they would requiremore powerful rockets to reach the United States.

According to CIA estimates, a two-stage Taepodong-2, which is now underdevelopment by North Korea, could deliver a payload of several hundredkilograms to Alaska or Hawaii. This would probably be sufficient todeliver a biological warhead, but not enough for an unsophisticatednuclear weapon.

A larger question is whether 1950s Soviet Scud technology, of the kindnow widely available in the Third World, can serve as a basic buildingblock for ICBMs. Russian scientists cite their own experience in arguingthat a Scud cannot be upgraded to an ICBM. To develop missiles thatcould reach the United States, the Soviets moved to systems with morepowerful propellants and vastly improved guidance systems.

"There are certain things you can do to improve the Scud, such aslightening the airframe, installing new turbopumps and clusteringengines, but you quickly run into limitations," said Timur Kadyshev, amissile expert at the Moscow Institute for Physics and Technology. "Atsome point, you need to switch to better technology."

Until recently, this was also the view of most CIA experts. Before 1998,CIA officials routinely argued that North Korea would have to adopt anentirely new propulsion system to achieve ICBM capability, thedevelopment of which could easily be detected by U.S. technical means.The agency's position now is that a similar result can be achieved byclustering engines and adding extra stages.

Russian experts say that, while this may be feasible in theory, theaddition of each new engine increases the chances of failure. Atwo-stage Taepodong-2, for example, is believed to consist of four NoDong engines clustered together as the first stage, and a single No Dongas the second stage. Mathematically, such a missile is at least fivetimes as likely to fail as a single, far-from-reliable, No Dong.

Another significant change in CIA methodology has been the abandonmentof the long-held view that a lengthy testing period was required beforea new missile system could be considered a real threat. According toRobert Walpole, the national intelligence officer responsible forcoordinating estimates of missile threats, the willingness of ThirdWorld countries to resort to nuclear blackmail has made the acceptedwisdom of a five-year gap between testing and deployment obsolete.

When the United States and the Soviet Union deployed missiles, heexplained, "they had to be in hard silos so that the other guy could nottake them out. But if what you are more interested in doing isthreatening the other side, not having a retaliatory launch capability,you don't have to deploy [missiles] in that sense of the term." Manyindependent experts say they believe that repeated tests are requiredbefore a missile can be deployed.

As military weapons, the Taepodong-1 and Taepodong-2 clearly leave muchto be desired. Before the rockets can be launched, they have to beassembled next to tall open-air gantries, in full view of U.S. spysatellites and planes flying off North Korea's coast. The process offueling and completing final checks takes three or four days, accordingto Charles P. Vick, a missile expert at the Federation of AmericanScientists.

As a political and propaganda weapon, however, the Taepodong-1 hasalready proved very effective. The North Koreans "got everybody'sattention" with their August 1998 missile test, said Joseph S. Bermudez,a leading expert on North Korean missile programs. "They made Americawake up and pay attention to them, which is one of the things theydesperately want. They want to be perceived as a powerful nation."
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A Story Of Iran's Quest for Power
Michael Dobbs
Washington Post
January 13, 2002
(for personal use only)

The first time Vadim Vorobei went to Iran in 1996, he was amazed by thenumber of foreign missile scientists wandering openly through Tehran.For the most part, they were people like him: elderly representatives ofthe old Soviet technological elite impoverished by the collapse ofcommunism and willing to sell their services to the highest bidder.

Although the Iranians made a show of keeping the scientists apart, saidVorobei, they frequently bumped into each other at hotels andrestaurants. One day, he would spot a leading Russian missile guidancespecialist; the next, a well-known missile engineer from Ukraine. Allhad been lured to Tehran on the pretext of giving lectures on rockettechnology to Iranian university students.

From the U.S. government perspective, Vorobei and his friends aresymbols of one of the most serious challenges of the post-Cold War era,the worldwide proliferation of ballistic missiles. In this view, Iran isa "rogue state" seeking weapons of mass destruction and sponsoringinternational terrorism. The prospect of such a country acquiringlong-range missiles is the nightmare scenario underpinning PresidentBush's decision to push ahead with the deployment of a national missiledefense system and withdraw from the 1972 Anti-Ballistic Missile Treatywith Russia.

Seated in his office at the Moscow Aviation Institute, one of severalRussian institutions under U.S. sanctions for proliferating missiletechnology, Vorobei insists that American fears are exaggerated. Heclaims he and other Russian missile scientists were brought to Iran inpart to demonstrate to the rest of the world that Iran was making rapidstrides toward becoming a major missile power that would soon be able totarget the United States. In fact, he insisted, Iran's capabilitiesremain much more modest than that.

"It was a huge mess," recalled Vorobei, a department head at theinstitute, the alma mater of many of Russia's leading missile engineers,describing what he said was a five-year collaboration with Iran, from1996 to 2000. "The Iranians took people who were needed and people whoweren't needed. There was something artificial about it. They weretrying to show that a lot of Russians were working for them andeverybody else should be scared by it."

The threat has been taken seriously by the Bush administration, whichused it to justify rapidly pushing ahead with the deployment of amissile defense system. A congressional commission headed by Donald H.Rumsfeld, now the defense secretary, predicted in July 1998 that Iranmight be capable of causing "major destruction" to the United States"within five years."

The differing perceptions over what Iran has achieved, and how muchoutside assistance it is receiving, go to the heart of the missiledefense debate in the United States. While few experts doubt that Iranis rapidly emerging as a regional missile power, opinions are dividedover whether its programs pose a real threat to U.S. territory, as theBush administration has suggested.

This is the first of two articles looking at different aspects of theworldwide missile threat, beginning with a detailed examination of theIranian missile program and Russia's role as a proliferator of missiletechnology. A follow-up article tomorrow will look at the record of U.S.intelligence in keeping track of the threat from such developingcountries as Iran and North Korea.

An Underground Railroad

Vorobei's activities confirm what Western analysts have long suspectedand the Russian government has repeatedly denied -- the existence of anunderground railroad of Russian scientists traveling to Iran to work onmissile and nuclear weapons programs. In two lengthy interviews, Vorobeioffered an unprecedented description of how Iranian officials recruitedtheir Russian tutors, brought them to Iran and sought missile technologyand know-how. But Vorobei's experiences also underscore the difficultiesIran has faced in developing long-range missiles.

Interviews with policymakers, missile scientists, and independentexperts in a half-dozen countries suggest that the prospect of aballistic missile attack on U.S. territory by a "rogue state" is in someways less likely now than in the summer of 1998, when the RumsfeldCommission issued its five-year warning. North Korea, the Third Worldcountry furthest along in missile development, has declared a testingmoratorium. Iran has had trouble perfecting its top-of-the line Shahab-3missile, with a range of about 800 miles, and has shown little sign ofembarking on a serious intercontinental ballistic missile (ICBM)program.

"The Iranian program is not developing as quickly as the Iranians haveclaimed, and Israeli and American assessments expected," said Gerald M.Steinberg, a strategic issues expert at the Jerusalem Center for PublicAffairs. He said that the Shahab-3 missile, when it is eventuallydeployed, will be capable of hitting Israel, but is hardly a threat tothe United States, nearly 6,000 miles away.

"A missile remains the least likely delivery vehicle for a weapon ofmass destruction," said Joseph Cirincione, director of thenonproliferation project at the Carnegie Endowment for InternationalPeace. "The September 11th events have shown that people can inflictmass casualties on the U.S. with cutting knives and imagination. Thereare many cheaper, more reliable, but still very destructive means ofattacking America that don't require the expense, technicalsophistication and exposure that come with a ballistic missile."

A Symbol of Power

Ever since the United States and the Soviet Union deployed tens ofthousands of nuclear-tipped missiles during the Cold War, the ballisticmissile has become the classic symbol of a country's great-poweraspirations. A ballistic missile is one that falls unassisted in apredetermined trajectory following its initial launch. Ballisticmissiles are usually larger, and capable of flying longer distances,than cruise missiles, which are powered throughout their flight.

With the possible exception of Nazi Germany and the V-2, the precursorto all modern-day missile systems, no country has ever produced amissile entirely on its own. Both the United States and the Soviet Unionwere helped enormously by teams of German scientists and missileengineers, recruited or simply taken prisoner at the end of World WarII. The Soviets helped the Chinese, who helped the North Koreans, whohave helped the Iranians, Syrians and Libyans.

The Iranian Shahab-3 is closely modeled on the North Korean No Dongballistic missile, which is itself a scaled-up version of the SovietScud, according to U.S. officials and independent experts. A liquid fuelmissile designed by Soviet engineers in the late 1950s, the Scudoriginally had a range of less than 100 miles. Over the last threedecades, the Scud has become the most widely proliferated missile inhistory. By scaling up Scuds, clustering them together, and stackingthem on top of each other, engineers have been able to greatly extendthe range of what remains a fairly primitive missile.

CIA analysts say that Iranian officials sought Russian assistance tobuild their own improved version of the No Dong, manufacturing their ownsophisticated components rather than relying on systems imported fromNorth Korea. Any assistance by Russia to the Iranian program would be aviolation of its commitments under the 1987 Missile Technology ControlRegime, an international agreement that restricts the sale of parts andexpertise for any missile with a range of more than 300 kilometers, or186 miles.

Just how much help Vorobei and his colleagues gave Iran is a matter ofdispute. U.S. and Israeli experts say that Russian cooperation with Iranhas been more extensive than Vorobei and his colleagues are willing toacknowledge. For example, they said they have evidence of Russianexperts attending Iranian static engine tests, in which a missile engineis strapped to the ground and fired, prior to a full missile test.

Vorobei said the Russian contribution to the Iranian missile program hasbeen limited by Iranian paranoia and secretiveness. "They wanted toreceive information from us, but at the same time they were not willingto tell us everything they were doing," Vorobei said. "That made itdifficult to help them."

For the most part, the Russian scientists who have traveled to Tehranappear to have been professors and academics like Vorobei rather thantop-flight experts from missile design institutes, whose movements aremuch more tightly controlled by Russian security agencies.

"It's meat-and-potatoes stuff," said Steven Zaloga, a leading Americanexpert on the Russian missile program. "These guys are useful at thelevel of basic research, not advanced development."

While Vorobei and other Russians concede that they helped Iran build upits general scientific base -- the first step toward a successfulmissile program -- they insist they stopped well short of transferringsecret information banned by international agreement. "It is one thingto learn rocketry in theory, and quite another to move to actualproduction," said Yevgeny Mishelov, dean of the Moscow AviationInstitute's metallurgy department.

Vorobei said he doubted U.S. projections that Iran could obtain anintercontinental ballistic missile within five or even 10 years. "Theirprogress is very slow," said Vorobei. "In order to build missiles, youneed a strong resource base. You need steel, aluminum, not to mentioncomposite materials, a machine tool industry. Iran has very little ofthis."

As an insight into the difficulties that Iran has encountered in itsmissile program, Vorobei cites the attempt to produce jet vanes for theShahab-3. Located at the bottom of the engine, the movable vanes helpsteer the missile and are an essential part of its guidance system.

Vorobei explained that the vanes must be coated with a heat-resistantmaterial to protect against super-hot gases from the engine exhaust. Hesaid Iran was unable to acquire either reinforced carbon-carbon ortungsten, two materials often used to coat jet vanes, so they usedgraphite, a poor substitute. While graphite can be used for jet vanes --Germany used it for that purpose during World War II for its V-2 missile-- it tends to crack under pressure.

"They created an engine, but not a proper guidance system," Vorobeisaid, pointing to the failure of two out of three tests of the Shahab-3."They don't have any real metallurgical industry of their own. Theironly hope is to steal something from neighboring countries, but theycan't steal everything."

By 1998, Vorobei said, there were signs that Iran was beginning to get"disillusioned" with the Russian involvement, and instituted alarge-scale leadership shake-up in Sanam, the government agencyresponsible for recruiting dozens of Russian experts for work on theShahab-3 and other programs.

Transfers Overstated

Prior to the publication of the Rumsfeld Commission report in 1998, CIAanalysts testified that it would take Iran at least 10 or 15 years todevelop an ICBM, even with maximum cooperation from the Russiangovernment. "Ten years is when the Russians come in, build the plant,operate the plant, and build the missiles," the agency's top missileexpert, David Osias, testified in 1996. Osias is now a senior analystwith the Defense Intelligence Agency.

While there has been leakage of missile technology from Russia to Iran,it has not been on the scale that Osias and others predicted would benecessary for Iran to develop an ICBM within 10 years. A detailedanalysis of all allegations of missile component transfer between Russiaand Iran over the past decade suggests that transfers have beensporadic, low-level, and largely confined to dual-use materials that canbe used for missile construction rather than entire missile systems, oreven sub-systems such as engines or guidance packages.

Most if not all of the transfers have involved private companies,possibly with the complicity of well-placed Russian governmentofficials. The most concrete allegations of Russian assistance to theIranian missile program concern the 1997-98 period when the Clintonadministration imposed sanctions on 10 Russian companies for cooperatingwith Iran. There have been no new sanctions on Russian companies since1998, despite claims by top CIA officials that Russian transfers ofmissile technology and expertise to Iran remain "substantial."

U.S.-Russia Distrust

"Our American partners have not presented us with concrete facts [ofproliferation]," said Sergei Yekimov, the Kremlin's chief enforcer ofexport controls. "Their allegations are usually based on emotions andsuspicions rather than corroborated evidence."

U.S. officials said they have provided some information about allegedmissile technology transfers to the Russian government, but refuse to gointo greater detail for fear of compromising intelligence sources andmethods. They said that Russian authorities often have appeared moreinterested in tracking down the source of the Western intelligenceinformation than in cracking down on proliferators.

"It seems to me there has been a drop-off in the more egregious types ofassistance," said Robert Gallucci, the Clinton administration's specialenvoy on nonproliferation issues. "This could mean that we did a goodjob. . .or it could mean that the character of assistance has moved todifferent areas that are harder to detect, and harder to control."

There is little doubt that Iran made a serious effort, beginning in theearly 1990s, to acquire Russian missile technology. According to U.S.and Israeli officials, items sought by Iran have included turbopumps,used to pump fuel and oxygen into the combustion chamber; specialtysteels to construct a lighter airframe, to reduce the missile's weightand extend its range; wind tunnels, to test the aerodynamics of missileparts; ablative materials, to protect the warhead from extreme heat; andfurnaces to produce graphite and carbon-carbon, high grade ablatives.

How many of these items were actually delivered is another matter,however. At least two 1997 contracts for turbopumps and a gas furnacewere canceled following U.S. complaints, according to U.S. and Russianofficials.

Sometimes, intelligence information is misleading. The Austriangovernment, acting on tips from the CIA and Israeli intelligence,intercepted two tons of basalt fiber as it was being loaded onto anIranair flight bound for Vienna from Tehran. The shipper was the RussianGrafit Research Institute. According to the CIA, the basalt fiber was aheat-resistant material that could be used to coat missile warheads.

After analyzing the fiber and impounding it for nearly a year, theAustrians concluded that the U.S. claim was "not plausible," andreturned the shipment to Russia. U.S. officials continued insisting thatthe fiber could have been used as an insulating material for missiles.

"Intelligence information can sometimes be very good, but sometimes Itruly wonder how they come up with such information," said HelmutKrehlik, head of the export control department of the Austrian Ministryof Trade, who investigated the basalt fiber shipment.

Accumulating evidence against proliferators is not analogous to being in"a court of law," countered Uzi Arad, a former director of intelligencefor the Israeli Mossad, who investigated Russian arms sales to Iran inthe mid-1990s. "We have evidence that is sufficient to convinceourselves. We are not obligated to prove anything to the Russians. We donot act according to due process and rules of evidence in thisbusiness."

U.S. officials say they are at least as concerned about the exchange ofknow-how as the sale of technology. "The nature of proliferation hasbeen changing over the last decade," says Robert Einhorn, senior adviserto the Center for Strategic and International Studies and the StateDepartment official in charge of counter-proliferation from 1992 untillast year.

"We used to think of proliferation as selling a missile system orbuilding an enrichment plant," he said. "Today, it is more likely tomean exchanging know-how over a cup of coffee, a Russian specialistgetting work with an Iranian who has been specially briefed to ask himquestions about solving a particular problem. It is software rather thanhardware."

North Korea's Role

There is less doubt about North Korean assistance to Iran. Therelationship dates to 1985 when Iran's former president, HashemiRafsanjani, signed a $500 million agreement with Pyongyang for thedelivery of North Korean missiles based on Soviet Scud technology.

Since then, according to U.S. intelligence officials, North Koreanassistance to Iran has ranged from entire missile systems to missilecomponents and engines to transporter-launchers for its short-rangeShahab-1 and Shahab-2 missiles. In return, Iran has shipped hundreds ofthousands of barrels of crude oil to the energy-starved Asian nation.

U.S. officials depict the Shahab-3 as an Iranian version of the NorthKorean No Dong. In addition to Iran, the CIA believes that North Koreaalso sold the No Dong to Pakistan, which renamed the missile the"Ghauri." These missiles are all "brothers and cousins" of the No Dongmissile, said Robert Walpole, the CIA's national intelligence officerfor strategic programs.

Unlike Pakistan, which merely repainted the fuselage of the No Dong,Iran attempted to independently produce the main components of themissile and improve on the North Korean original. Iranian officials havecomplained about the low quality of North Korean missile components, andthe sometimes exorbitant prices charged by Pyongyang for its services.

"The Persians were indignant with the North Koreans," said Vorobei."They complained that the Koreans were selling their technology veryexpensively. The Iranians would take it to pieces, and then reassembleit."

Engine Failure

While Iran has succeeded in independently producing some of thecomponents for the Shahab-3 missile, it also has experienced significantsetbacks. The biggest, according to U.S., Israeli, and Russianofficials, was its apparent inability to perfect its own version of theShahab-3 engine that it sought to build, rather than relying on theoriginal North Korean engine.

So far, there have been three flight tests of the Shahab-3; in July1998, February 2000, and September 2000. The first and third tests endedin failure, apparently due to problems with the domestically producedengines, according to U.S. and Israeli experts. The second test, inFebruary 2000, appears to have been relatively successful, but onlybecause Iran replaced its own engine with an engine produced in NorthKorea.

The experts said that the new engine appeared to be one of a batch of adozen missile engines that were detected by U.S. spy satellites inNovember 1999 being loaded onto an Iranian cargo plane at an airportnear the North Korean capital, Pyongyang. "You don't buy a dozen enginesunless you are in deep trouble," said an Israeli government expert.

Despite the setbacks, most experts agree that Iran will perfect andeventually deploy the Shahab 3 missile, enabling it to reach targets inIsrael and the eastern Mediterranean.

The big question is whether Iran will attempt to build a new generationof missiles capable of traveling much longer distances. Evidence thatTehran is interested in longer range missiles rests mainly on statementsby Iranian officials referring to a Shahab-4 and Shahab-5, as follow-upsto the Shahab-3.

Recent statements from Iranian officials, along with evidence fromIranian missile tests, suggest that Iran is now shifting its emphasisfrom long-range liquid fuel missiles, such as the Shahab, to short-rangesolid-fuel missiles. This would parallel Iran's overall threat analysis,which highlights regional threats from countries such as Iraq andIsrael, as well as U.S. forces in the Persian Gulf, over a potentiallong-range threat from the United States or Europe.

"There is a big difference between Iranians trying to cover the region,and developing a system that will allow them to attack the U.S.," saidGary Samore, a senior fellow at the International Institute forStrategic Studies in London and former White House senior director fornonproliferation for the Clinton administration. "I don't think theIranians have yet made a fundamental decision about developing an ICBMcapability."

Other analysts say that, while Iran's long-range missile programs mayhave faltered recently, the country is systematically laying thefoundation to become a world-class missile power. Iran is proceeding ina much more structured way than North Korea, which is more willing totake risks and short-cuts, according to Clyde Walker, director of theDefense Department's Missile and Space Intelligence Center inHuntsville, Ala.

"Iran went into this business because they got clobbered by Iraq [in the1980-88 war]," he said. "They are laying down the infrastructure [and]will continue until they have world-class systems."
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Collapse Of Soviet Union Proved Boon To Iranian Missile Program
Michael Dobbs
Washington Post
January 13, 2002
(for personal use only)

At the very time that Russian weapons designers found themselves adriftfollowing the collapse of communism in the early 1990s, Iran wasdesperately in search of technological know-how to become a majormissile power.

As a member of the Soviet Union's technical elite, Vadim Vorobei enjoyeda wide number of privileges under communism, including paid vacations, aheavily subsidized apartment, access to special stores, free medicalcare and a dacha. When the Communist system fell apart, all thatdisappeared. Suddenly, almost overnight, he and thousands of otherhighly-trained missile engineers found themselves pitched from the ranksof the well-off into the ranks of the destitute.

"Everything collapsed," recalled Vorobei, whose salary as head of thefaculty of engine production at the Moscow Aviation Institute, one ofRussia's leading rocketry schools, is just $90 a month. "Our only hopewas abroad. Iran, Pakistan, Guinea. Anybody who was interested in us."

Iranian students began showing up at the Moscow Aviation Institute inthe mid-1990s, at a time when the institute was desperate to raise moneyto compensate for reduced state subsidies. By 1996, there were 16Iranian undergraduate students studying engineering and rocketry, alongwith several postgraduates in more specialized fields such asaerodynamics.

The postgraduate students soon began cultivating the Russian professors,and invited them to Tehran to give lectures. Vorobei said that he wasamong an initial group of five Russian missile experts who traveled toTehran in 1996. Eventually, dozens of Russian missile scientists went toIran, including specialists in guidance systems, metallurgy, andaerodynamics. The visits were kept secret and Russia publicly deniedthat its scientists were helping Iran.

While the pay was meager by Western standards -- between $50 and $100 alecture plus expenses -- it was much more than the missile scientistscould earn in Russia.

A powerfully built man in his late sixties, Vorobei said he traveled toIran about a dozen times between 1996 and 2000, often in the company ofan even older friend, Vassily Loginov. They would usually go for a weekor two at a time, sometimes staying in the Iranian Foreign Ministryguesthouse, sometimes in hotels.

At first, Vorobei's role was limited to giving lectures at a technicalcollege in Tehran. He is an expert in the use of composite materials inrocket production, and has co-authored a university textbook on thesubject. After the lectures, the Iranians would pepper him withquestions about different aspects of missile production. Sometimes, theywould arrive with blueprints of a missile part, and ask whether it hadbeen designed "in a good or a bad way."

"I would make suggestions to them," he recalled.

Russian professors willing to cooperate more extensively with Iran wereoffered more lucrative work, sometimes earning as much as $100,000 acontract, according to Vorobei. He and Loginov, a specialist in turboengines, worked with the Iranian Energy Ministry on several projects,such as designing high-tech joints, methods of producing turbine-basedmachines, and a study of various types of springs.

While the Iranians did their best to be hospitable, Vorobei said henever felt at home in Tehran, and would have much preferred to beworking with Americans or Europeans. Like most Russians, he chafedagainst the stringent alcohol restrictions. Some scientists tried tosmuggle vodka into the country, only to see it confiscated at theairport.

"It was depressing. There was nothing to do in our free time," hecomplained, describing a limited television diet of politics on onechannel, clerics on the second channel, and sports on the third.

He suspected early on that both the U.S. and Israeli intelligenceservices were breaking into his computers and tapping his telephoneconversations. "As soon as we went to Tehran, they found out straightaway." U.S. and Israeli officials confirm that they were familiar withVorobei's activities in Iran.

When Vorobei first began traveling to Tehran in 1996, he faced fewobstacles. Indeed, he is at pains to point out that he went with theapproval of his superiors. Passports were arranged officially throughthe Foreign Ministry and the state security service, the FSB.

According to Yevgenia Albats, a prominent Moscow journalist who hasstudied Russian missile proliferation, FSB officials routinely tookcommissions from Iranian procurement agents in return for facilitatingthe travel arrangements of Russian experts. Some Western intelligenceofficials believe this indicated high-level Kremlin approval for missilecooperation with Iran; others take a more benign view, arguing that itreflected the anything-goes atmosphere of the Yeltsin years, when evenFSB agents could be bought.

It was not until 1998 that Vorobei began getting different signals fromRussian authorities, in response to vociferous complaints from U.S. andIsraeli officials. According to Moscow Aviation Institute's director,Alexander Matveyenko, the Russian security services began complainingabout Vorobei's activities. "The Americans were putting pressure onthem, and they were putting pressure on us," he said.

A row broke out within the institute after the United States canceled $1million in research contracts because of the Iranian connection. Theprofessors who had been receiving U.S. grants blamed Vorobei and Loginovfor their troubles. Matveyenko sided with the anti-Iranian group.

Vorobei and his supporters sought to disguise their activities byestablishing a private business outside the institute. The businessconcluded an agreement with the Iranian Ministry of Energy, which U.S.officials said has long been used as a front for missile procurementefforts by Tehran. "Officially, we stopped work [with Iran] but in factwe continued," says Vorobei.

U.S. and Israeli intelligence soon heard of the new arrangement, andinsisted that it too be halted. Finally, in the summer of 2000,Matveyenko called Vorobei to his office and gave him an ultimatum: Stopworking for Iran or cut off all ties with the institute. Reluctantly,Vorobei complied. He said the Iranians were so offended that theyrefused to pay him what they already owed him.

In addition to prohibiting professors from traveling to Iran, Matveyenkoalso stopped Iranian students from taking courses at his institute. Thelast six Iranians -- out of a total of 29 -- graduated from theinstitute last year. Despite these steps, U.S. sanctions against theinstitute are still in force. "There is a program for imposingsanctions, but not for removing them," Matveyenko complained.
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E. Russia-Burma

Burma Announces Nuclear Plans
Larry Jagan
January 11, 2002
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Burma has announced it plans to join the nuclear club.

The Burmese Foreign Minister, Win Aung, told the BBC his country wascommitted to developing a nuclear research facility for medical purposesand possibly to generate nuclear power.

But it would be some time before a nuclear reactor was actually built inBurma he said.

In recent weeks there have been numerous reports that Russia has signeda deal with Burma to supply a reactor.

The Burmese authorities have admitted more than 200 technicians havereceived nuclear training in Moscow in the last 12 months.

The International Atomic Energy Agency (IAEA) in Vienna has officiallyasked Moscow to provide details of any deal they have done with Rangoon.

Safety standards

Win Aung said no deal had yet been signed but initial research had beendone and Burma is keen to explore the use of nuclear energy. He saidmany other countries in the world are using nuclear power.

Given Burma's chronic energy shortage, there is little wonder they mightwant to experiment with nuclear power.

IAEA officials said Rangoon told them last September of plans to acquirea nuclear research reactor and asked for help to secure one.

Two months later the IAEA sent an inspection team to Burma to assess thecountry's preparedness to use and maintain a nuclear reactor safely. Theteam concluded that the safety standards in place were well below theminimum the body would regard as acceptable.

Burma has yet to respond to the IAEA report, but nuclear officials inVienna fear this means that Burma plans to proceed with their nuclearambitions without the necessary attention to safety.

Asian concern

But nuclear experts say that even if the military government wanted tobuild a nuclear reactor, it is likely to be several years before thishappens.

In the meantime many countries, especially in the Asian region, will beconcerned about the prospect of a nuclear Burma.

Diplomats in Rangoon say authorities have trouble maintain existingelectricity generators let alone a nuclear reactor.
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