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THE KREMLIN'S HIGH-TECH HIT LIST OF U.S. COMPANIES
By - John Paul Newport Jr.

(FORTUNE Magazine) – The Soviet Union, long afflicted with mediocrity in much of its home-grown technology, is a past master at filching the technology of others. In recent years, U.S. officials believe, it has revved up its assault on Western military technology to unprecedented levels. A white paper released by the Pentagon in September depicts the massive Soviet campaign in surprising -- and disturbing -- detail. One highlight: a ranking of the U.S. defense contractors whose high-tech work the Russians apparently would most like to get their hands on. Directing the Soviet assault is a secretive group of defense manufacturing executives known as the Military Industrial Commission (called VPK, for its Russian initials). Its targets are usually specific samples of hardware or the technical manuals that describe them. Despite Western government restrictions, the white paper says, several thousand Soviet and Eastern European agents -- posing as everything from science attaches at embassies to office managers for Aeroflot, the Soviet airline -- manage to fulfill a third of the VPK's requests each year. The annual budget for buying equipment outright or paying off informants is over $1 billion. The greatest benefit to the Soviet military comes from copying the items collected. Duplicating U.S. microprocessor chips is so common that to avoid confusion the Soviets identify some copycat chips with part numbers almost identical to those on the originals; the Soviet clone of Intel's 8080A microprocessor is labeled KR5 80 IK 80A. The white paper concludes that about 5% of all Soviet military research projects spring from ideas suggested by pirated Western goods. In 27% of the projects, exposure to Western technology either eliminates time-consuming research or speeds it up significantly. The authors of the white paper constructed a Kremlin hit list of U.S. defense contractors based on the frequency with which they turn up in VPK documents. General Electric -- whose name appeared most often -- makes jet engines, guided missile subsystems, and nuclear reactors. Boeing, No. 2 on the list, turns out Awacs early-warning radar planes, electronics for the B-1B bomber, and cruise missiles. No. 3 Lockheed builds antisubmarine aircraft and Trident missiles and does extensive research in electronics and space technology. Westinghouse, a leader in radar and factory automation, turned up No. 6. Allied Corp. (radar, submarine-detection systems, flight-control instruments) was No. 9; the Massachusetts Institute of Technology, which does electronics and computer research on contract, ranked No. 13. Increasingly strict enforcement of export controls by the Administration and tougher attitudes by companies may be making the VPK's job more difficult; IBM and Motorola have worked up new programs to educate employees about the dangers of loose lips. But most large defense concerns feel they already have adequate security. They point out, as the white paper does, that most of the information the Russians get comes from public sources like the U.S. Patent Office and scientific journals or from outside the U.S. For example, a worldwide network of dummy companies controlled by the West German Richard Mueller delivered tens of millions of dollars of advanced Western computer and manufacturing equipment to the Soviets from 1978 to 1983. Most defense contractors would like to avoid more extensive export controls, since they cut down on potential customers. ''There are two ways to keep someone behind you,'' says Robert Wertheim, senior vice president of science and engineering at Lockheed. ''One is to hinder him. The other -- my choice -- is to run faster.''