Speaker Identification:
EH: Eric Hirschhorn  
PP: Penny Pritzker  

EH:  Ladies and gentlemen, I’m sorry to interrupt your dessert and coffee, but we would like a few minutes of your time. I’m Eric Hirschhorn. I have the honor of heading the Bureau of Industry and Security, and I’m privileged today to introduce someone who really needs no introduction, or at least not much of one, and that’s our keynote speaker.
Penny Pritzker is one of the most visible and influential Secretaries of Commerce since the department was created over a century ago. As our country’s chief commercial advocate, she’s traveled to more than 35 countries as well as many locations within the United States seeking to advance the President’s priorities of expanding growth and opportunity for all Americans. Before joining the administration, she founded and ran businesses in the real estate, hospitality, senior living, and financial service industries, so she’s spent a lot more time on really your side of the street than on the government side. She was also active in public service during that period including service on the Chicago Board of Education.
Given her enormous success in our Washington, D.C. circus, I’d been wondering whether her next gig might be with Ringling Brothers and Barnum & Bailey. She certainly has proven her ability both as a juggler and as a ringmaster over the past three years, handling simultaneously such disparate subjects as export controls, international trade missions, data privacy, patent legislation, weather satellites, spectrum allocation issues, the economy of Ukraine, the 2020 Decennial Census, and local economic development here at home. The President’s Export Control Reform initiative was well under way when she arrived three years ago, but she has put her shoulder to the wheel 110 percent to ensure that we have the resources and the political support to complete that massive task. Please welcome the Secretary of Commerce, Penny Pritzker.
Audience:  (Applause)
PP:  Eric, thank you very much for your kind introduction. I think I’m going to be like the elephants at Ringling Brothers. My day has come and gone. Anyway, Eric… okay. Bad circus joke, right?
Audience:  (Laughter)
PP:  Anyway, Eric, I can’t thank you enough for your tremendous leadership of the Bureau of Industry and Security. You’ve approached your role with both excellence and persistence, and the people in this room could not have asked for a better steward of BIS during this critical time in its history. And I must admit, Eric, over the last three and a half years, you’ve actually managed to make export controls both interesting and exciting for me.
See, the first time I met Eric, I was a total newbie when it came to the work of BIS, and Eric knew that I’m a visual person. I kept repeating this: “I’m a visual person. I’m a visual person,” in the office, because I was struggling to understand, and so to help me understand the challenges that are faced by exporters, he showed me these two aircraft switches. Now, they look the same, right? They even serve the same simple function: turning a circuit on and off. But before Export Control Reform, one had no restrictions, and the other had the same restrictions as an entire military aircraft. Now please do not ask me to tell you which one is which.
Audience:  (Laughter)
PP:  But clearly, with that example, it’s easy to visualize why our export control system had room for improvement. Three and a half years later, not only do I finally have a solid grasp on the intricacies of BIS’s work, but this administration has successfully implemented Export Control Reform. Today as I speak to you for the last time, I hope to leave you with a clear understanding of the two critical roles BIS plays in our country: protecting our national security and advancing U.S. foreign policy goals around the world.
So let me begin with national security. As you know, early in this administration, President Obama and the Secretaries of Commerce, Defense, and State recognized the urgent need for a broad-based review and comprehensive reform of our export control system. Over the last seven years, we have taken significant steps to rationalize our controls, increase interoperability with our closest allies, reduce incentives for companies in allied countries to avoid U.S. content, services, and technologies, ensure our government is focused on the transactions, end-uses, and end-users that matter the most, and make regulations more reliable and predictable.
We’ve revised the military and satellite controls on the U.S. Munitions List and the corresponding controls on the Commerce Control List. We’ve also published rules that help you reach quicker, more reliable conclusions about applicable Export Control Reforms. Our goal has been to rationalize the system and streamline the licensing process, but in the process, we’ve also reduced the amount of paperwork and applications you have to file, making it easier for you to sell your items around the world.
As you all know, reform alone is not sufficient. An Export Control Reform system is only as good as its enforcement, and during the Obama administration, we have taken concrete steps to make enforcement of our laws more focused, more efficient, and more transparent. Our information triage unit has helped us to make better decisions about proposed exports and helped us prevent diversions of controlled items.
We also launched the Interagency Export Enforcement Coordination Center to increase communications and resolve potential conflicts among various federal enforcement agencies. In addition, BIS has made the civil penalty process more predictable and more transparent to the public.
Even with this progress, there’s still much more work to be done, and I know you’ve heard me say this before, but I have to say it again. Export Control Reform is an ongoing effort, and in order for us to do well and deal with emerging threats and new commercial applications of your technologies, we need your help. This is truly a partnership. You know your products, your competitors’ products, your customers, and your marketplace better than we can ever know it. We need you to look out for questionable sales and let us know if an inquiry or a proposed sale seems suspicious to you. We need you to help us understand when we have needlessly restricted a product like the two switches that I have in my hand.
Let me give you an example of where you guys have really helped us. When we attempted to formulate an objective parameter to distinguish between military and civilian aircraft engines, we proposed a distinguishing feature: whether the engine is capable of flying upside-down. Well, imagine our surprise when industry told us that most civil aircraft engines are indeed capable of some flying upside-down. Now I’m sure none of us are looking forward to that experience.
Audience:  (Laughter)
PP:  Certainly not on our flight home after this conference.
Audience:  (Laughter)
PP:  Anyway, we fixed the entry with your input, and now we have a much clearer set of controls to distinguish military from civilian aircraft engines. Clearly your partnership was essential not only to that determination but to our overall success. Your presence and your voice matter tremendously to us, and that will not change.
Now I want to turn to BIS’s second key mission which is equally as important: advancing U.S. foreign policy goals around the world. So for example, BIS plays a critical role in our country’s policies towards Russia. As part of the administration’s effort to sanction their violation of international law through their invasion of Crimea and their misconduct in eastern Ukraine, BIS imposed targeted restrictions on exports to Russia. In looking at the data, those actions are clearly having an effect.
At least year’s conference, I spoke at length about BIS’s role in normalizing relations with Cuba, kind of the opposite. In the past two years, we’ve amended our regulations six times to help implement the President’s historic policy to engage and empower the Cuban people. Since 2015, our department has authorized over $6 billion worth of exports to Cuba, ranging from medicine to agricultural products to items that ensure the safety of civil aviation. Our most recent action allows sales directly to the Cuban people, and although more steps are needed, including lifting the embargo, the changes made by BIS are helping to unlock Cuba’s economic potential and create opportunities for its people.
As you can see, the leadership of the Bureau of Industry and Security has been and will remain critical to protecting our national security, strengthening our economy, and advancing our country’s interests. All of us in this room will miss Eric’s leadership when he departs, but he will leave you in the capable hands of BIS’s experienced and talented professional career staff including Deputy Under Secretary Dan Hill, Deputy Assistant Secretary Matt Borman, and Deputy Assistant Secretary Rich Majauskas.
Now and into the next administration, I have great confidence in this team, and you should as well. Three and a half years ago, after Eric handed me these two aircraft switches, I understand, and I hope you do as well, the critical role of BIS. They ensure that our technological superiority is not employed against us on the battlefield. They help us create a level playing field so that all companies play by the same rules. They serve as a key steward of our nation’s security – our national security, our homeland security, our cyber security, and our economic security. Put simply, with your partnership, BIS helps keep America safe. Thank you very much.
Audience:  (Applause)