IP3, Yeah You Know Me

Jeffrey Lewis 0:02

So you're like actually 100% sure they would f*** it up? Of course they would f*** it up. Are you kidding? You are listening to the Arms Control Wonk Podcast, the leading podcast on arms control, disarmament, and nonproliferation. I'm Jeffrey Lewis, the founding publisher of the Arms Control Wonk blog, and a scholar at the Middlebury Institute of International Studies at Monterey.

Aaron Stein 0:28

And I'm Aaron Stein, the director of the program on the Middle East at the Foreign Policy Research Institute in a very, very, very snowy Philadelphia.

Jeffrey 0:37

It's a snow day out here on the East Coast. I would brag about our sunshine, but we've been hit with torrential rainstorms for the past couple of weeks. So it has been nice the last day or two, but I feel your pain, Aaron.

Aaron 0:50

I think the forecast is three to five inches. I can look out my window now and say we're probably going to get closer to the five mark, but we'll see.

Jeffrey 0:58

Also, our office is overrun with rats, so we got that too.

Aaron 1:05

Well, I was going to ask you, because when it does rain in California, it sort of exposes all the problems in the way the houses are constructed, because you never get any weather. So you have leaks and all these weird vermin come wandering in holes in the walls.

Jeffrey 1:19

Oh, no, the rat thing actually started over the winter. They were doing some work on the building, and they apparently disturbed a rat's nest, and they... They made a nest in one of my colleagues' offices, and now we have these giant T-Rex rat traps all over, and it's, like, it should be a comedy. Like, the Coen brothers should, like, document the comedy of errors as these guys try to, like, catch these f***ing rats, which they're unable to do.

Aaron 1:44

Well, I was going to say this could also be our pitch for Orkin to start placing advertisements on the podcast, but I think you just squandered that opportunity.

Jeffrey 1:51

Well, I want to talk about a different kind of vermin today, the sort that have infested the White House.

Aaron 1:58

I guess you're living in a swamp out there, and we're still in the swamp out here on the East Coast.

Jeffrey 2:04

Boy, a hell of a story about IP3, the firm that disgraced National Security Advisor Michael Flynn was involved with.

Aaron 2:19

He's going to prison, right? He's disgraced. He's disgraced. I just find it funny because this whole cast of characters, like, if this was a dark comedy, like, this would be the point of the show where, like, you actually started to feel bad for the people because it's all gotten so absurd. Are you kidding me? I don't feel bad for these son of a. They all belong in prison. And you know, the worst thing is like.

Jeffrey 2:44

We're all making fun of Mike Flynn now, but like Elliott Abrams has been rehabilitated. I know. Elliott Abrams, you know, promoted policies that resulted in like the brutal murder of large numbers of people in Central America. He lied to Congress about it. And, you know, like if you criticize Elliott Abrams on Twitter, suddenly you're like uncivil because, you know.

Like we can't be mean to the people who promote massacres.

Aaron 3:11

Yeah. Even the G word. But we're not talking about we're talking about is it. I just want you to understand your future with Michael Flynn here.

Jeffrey 3:19

Right. Like Elliot Abrams, like he's not going away. Well, he's going to get like a nice job at CFR. And, you know, some like, you know, Democrats and Republicans in 20 years are going to be talking about how like mean we are for remembering Michael Flynn's turn as a unregistered foreign agent.

Aaron 3:36

And he took a doozy about the Middle East Marshall Plan, sometimes with one L, other times with two Ls, depending on who was writing the emails.

Jeffrey 3:46

Yeah. So, for readers, the House Committee on Government Oversight actually has a different name now, right? This committee has changed a couple of times. It's the Committee on Oversight and Reform now. Okay. They released a staff report, which, you know, is probably a little one-sided because it's a staff report that details an effort by a company called IP3, which, well, I can't really describe it any better than...

A senior official who complained about it it, it's a, it's a proposal for a Middle East Marshall Plan in which the United States would build, I don't know, how many reactors in Saudi Arabia. Dozens? Yeah, because dozens is also the word I saw. Yeah. but as one senior official said, it's not a business plan, a scheme for these generals to make some money.

Aaron 4:42

Yeah, and the scheme to make some money using political connections, politically affiliated people in the Trump orbit, to try and, I guess, galvanize the American reactor building industry? Is that the right way to describe it?

Jeffrey 4:59

Yeah, I think that's right. I mean, it's actually... We'll talk about this a little bit, but on the one hand... People are focused on the reactor piece of this.

Aaron 5:12

Yeah, so-called sensitive nuclear technology, right? Well, actually, that usually refers to enrichment and reprocessing. I know, I know. But this sort of got conflated in this.

Jeffrey 5:22

Yeah, well, I think the interim report by the House could be better.

Aaron 5:28

I mean, it's pretty freaking good as it is. I'd say the person who wrote this probably had a good time.

Jeffrey 5:35

I mean, you know, it's written like a brief for the prosecution, so it's a wonderful read and it contains lots of damning information. I think if one were an academic and going through it, I think there's a little more context that needs to be added. Not context, by the way, that would resolve the ethical and legal morass that's on display, but just would give it a little bit more context.

But, you know, they like... Made the rounds. So there's more information about this thing floating around, which I think is going to come to light pretty soon. So I just thought we'd talk about what the actual proposal was and then talk a little bit about what the problem with it is. Because I think, you know, from the perspective of the Committee on Oversight and Reform, There are some ethical and legal problems that are emerging.

But since it involves, what's Trump call it, the nuclear, there are also some proliferation concerns. And so I think maybe that's the way to go about this podcast.

Aaron 6:50

Yeah, and I... Okay, so I think, like, okay, so if we're going to summarize what it was doing, I think the best way for us to do this for the listeners is just to read what the report said. So I think you have it queued up for, like, the basic approach of the Middle East Marshall Plan.

Jeffrey 7:05

So one set of goals was for... The U.S. government to embrace the plan formally, right? And so the passage from the report that relates to that is, just days after the president's inauguration, IP3 officials sent documents directly to General Flynn for President Trump to approve, including a draft cabinet memo stating that the president had appointed Mr. Barack, that's Tom Barrack, who headed the inauguration and is a friend of Donald Trump, Stating that the president had appointed Mr. Barack as a special representative to implement the plan and directing agencies to support Mr. Barack's efforts.

Aaron 7:48

Yeah, so maybe now this is the time to... What was the plan, according to the report?

Jeffrey 7:53

And the plan, which we'll fill out a little bit in a second, but just reading from their description... It's a Middle East Marshall Plan to develop dozens of nuclear power plants. And it's a little bit more than that. It's actually quite a bit more than that. And I think that's where a little bit of the confusion is coming in.

Because on the one hand, there are some ethical concerns about the manner in which the thing was pursued. There are some legal concerns arising from steps that the United States would have to make in order to be able to export the technologies involved in the construction of those power plants. But then there are the proliferation concerns because...

You know, like there are laws about the export of these technologies for a reason, right? And if you don't follow those laws or if you don't understand those laws, one may find oneself in a position where the technologies being exported are involved in the production of nuclear weapons. So maybe we could talk about those three things.

Aaron 9:08

Yeah. So let's just start right there with the first one that you wrote down. According to the report, the ethical things that were listed.

Jeffrey 9:16

Right. So, I mean, I think the big thing is early on, Flynn... Was an advisor to a subsidiary of IP3 called Iron Bridge Group from June 2016 to December 2016, according to the report. And so at that time, he was also an advisor to Trump during the campaign and the transition.

Aaron 9:47

Right. And so... Yeah, go ahead. Yeah, no, and then obviously Trump wins the election, much to everybody's... Surprise, perhaps even disgrace General Flynn. And that's when I think the ethical things become even more brighter.

Jeffrey 10:03

Right. So after the inauguration, according to the report, IP3 officials send the documents to Flynn. Right. So that's the draft cabinet memo stating that the president would appoint Mr. Brock as special representative to implement the plan and directing agencies to support Mr. Brock's efforts. And according to the report, someone drew the attention of the NSC Ethics Council, as well as some other attorneys in the NSC legal advisor's office to this matter.

And again, according to the whistleblowers cited in the report, that the counsel as well as some other attorneys agreed that Flynn had a potential conflict of interest that could violate the criminal conflict of interest statute. And so again, according to the report, the NSC legal advisor instructed NSC staff to cease all work on the plan.

Aaron 10:57

And at this point, Flynn is the national security advisor, and this is now percolating within his NSC staff. So basically at the get-go of the Trump administration, these documents from Barack and then IP3 end up percolating throughout the NSC.

Jeffrey 11:16

Right, and what I think is important here... Is that you and I on this podcast aren't going to be able to, working merely from a House committee report, determine whether Flynn broke the law or not. But what I would say is if I were in Flynn's position... Or if I were in the position of anyone working on this issue, regardless of what I thought about the conflict of interest, when the NSC legal advisor tells me to cease all work, like, I'm done.

Aaron 12:05

That seems to be just a life lesson. When a legal advisor tells you you're getting close to going beyond the boundaries of the law, if you don't want to end up in prison, maybe you should stop what you're doing, right?

Jeffrey 12:20

Yeah, I mean, it's a life lesson.

Aaron 12:22

I'm going to tell that to my son when we hang up here. Like, Ollie, when a lawyer tells you you're breaking the law, just listen to him or her.

Jeffrey 12:29

And now it gets a little weird because Flynn gets fired, but work continues. And so I suppose... I suppose one could say that the conflict of interest went away, but... There's this meeting in which an NSC official after Flynn has been fired saying that he still speaks with him every night.

Aaron 12:51

Yeah, that would be one. According to the report, Derek Harvey, the senior director for Middle East and North African affairs from January to July 2017. And there is.

Jeffrey 13:06

You know, I mean, the report details efforts to continue to push this, and apparently staff go back to the NSC legal advisor and say, like, we are still really worried about this because this seems like it is... I mean, it describes it as reported unethical and potentially illegal actions by General Flynn and Mr. Harvey. And it seems, I don't know what the NSC legal advisor says, but then H.R.

McMaster, who has replaced Flynn as a national security advisor, again tells them to stop.

Aaron 13:34

Yes, he follows the ethical, he follows, I guess, the Arms Control Wong podcast dictate that when a lawyer tells you you're breaking the law, listen to the lawyer.

Jeffrey 13:44

Yeah, and, like, I don't, like, I am not someone who thinks that, like, McMaster is, like, was a particularly good national security advisor or, like, some great patriot, you know? Like, I am pretty skeptical of him as I am with many of these people. But, like, he seems to be, like, basically aware of how not to go to prison.

Who knew that was part of the interview process? But, yeah. Yeah. But despite...

Aaron 14:14

That it does seem like work continues right, which I, people continue to push like, as the work continues, there are other, maybe this is where we flip into, rather than the ethical, like, how it then goes into the legal and aspects of this, and how, I mean, did they misunderstand how to export nuclear technology, or was that not really the point?

Jeffrey 14:40

Yeah, that is a really great question. Because I think it's a little bit of both. Yeah. Oh, by the way, I should say, when I say work continued, I mean, it seems like IP3 kept pressing. It doesn't seem like once McMaster told them to stop. It doesn't... I don't see a lot of documentation that... NSC was continuing although there may have been individuals who kept pushing right so it kind of breaks off there but then this question of like do they know or not and I think there's this one exchange that really sums up the ambivalence I have about whether they were Criminal or merely morons.

And, you know, like not knowing the law in many cases is not an excuse, particularly when the legal advisor tells you to stop. Right. So they may be criminal and morons. But what I'm kind of interested in is the deeper question of. When the legal advisor tells you to stop, why do you keep doing it?

Aaron 15:44

Yeah, and I think it references something that we said at the top of the show that sort of we dropped but needs to also be said and brought up in this thing is how this isn't all that different than a standard industry proposal.

Jeffrey 15:55

Right. In response to this is, or the interaction, I think, that perfectly captures this, which I just had in front of me. Sorry. Okay, here's the passage that goes directly to that question. Career staff warn that any transfer of nuclear technology must comply with the Atomic Energy Act, that the United States and Saudi Arabia would need to reach a 1-2-3 agreement, and that these legal requirements could not be circumvented.

Which is, like, approximately true.

Aaron 16:21

100%, yeah.

Jeffrey 16:23

There are probably some backdoors.

Aaron 16:25

But at the scale of dozens, you know, up to 40? You really need a 1-2-3 agreement.

Jeffrey 16:33

Yeah, at this scale. I mean, I'm sort of in my mind... You know, thinking like if I had like Tom Moore with me, could Tom and I sit down and design a 40 reactor sail that skirted U.S. law, taking advantage of all of Tom's knowledge of the loopholes? Yeah, we could, but he wouldn't do that. So actually, there's probably not anybody alive who would know how to do that.

So you do need a one, two, three agreement. And Mr. Harvey reportedly ignored these warnings and insisted that the decision to transfer nuclear technology to Saudi Arabia had already been made. So I can't tell if that's... Hi. I am an idiot. And so you can talk about one, two, three agreements, but my eyes glaze over and I'm just going to repeat the thing on the piece of paper in front of me.

Aaron 17:20

Right. Essentially, which is an email of a... Somebody had drafted an email to send in Flynn's name to Trump.

Jeffrey 17:29

Right. Or whether that's like... A decision that there would be a program to, you know, export these reactors without a one, two, you know, like I just, I, I can't, you know, they're like, both of those things are stupid, you know, like, like you need a one, two, three agreement. And like, it is not more complicated than that.

And so when you say like, well, the decision's already been made, that is a dumb, non-responsive answer. It's unclear to me whether that is an answer that like reveals criminal intent or whether it's just an answer that suggests someone who is a moron. Right.

Aaron 18:16

Okay. Which brings us, I mean, I guess it's like the next paragraph in the document where, you know, where it's not a business plan, but in quotes, One senior political official stated that the proposal was not a business plan, but rather, quote, a scheme for these generals to make some money. That official stated, okay, you know we cannot do this.

Right.

Jeffrey 18:37

And I think an important thing to observe here is what IP3 was. Right. Because IP3 is not a firm that has any technology.

Aaron 18:56

Mm-mm.

Jeffrey 18:57

Right. Well, there's a little bit. But in terms of who is going to make the fuel, that would have been Centris. And they have a meeting where there are some officials from various companies. Who is going to have the reactor design? That would be Westinghouse. And I think one of the things the report mentions is that Tom Barrack was looking at buying Westinghouse, perhaps.

Who's going to build the plant? Well, that would be Bechtel. Who's going to operate the plant? Well, that would be Exelon. Who's going to handle the grid? Well, that's going to be some combination of Siemens, GE, and Bechtel. The one thing is that the security for these facilities was going to be Iron Bridge Group, which was IP3, so that's kind of what they're bringing.

Aaron 19:37

Well, that's the subgroup that Flynn was in, correct?

Jeffrey 19:40

That's right. So, you know, they're bringing that, but... What this really is, in my opinion, is this is a political entity. If you look at the leadership, the list of national security, energy, and policy leaders that are associated with that company, they are all either representatives of those various firms, or they are important people with backgrounds in the military, In politics or in think tanks.

So they are... This is an entity... That the skill it's going to bring is not that they know how to build a reactor, it's that they know how to convince the president to want to build a reactor.

Aaron 20:34

Correct. I mean, would you call it a consultant? I mean, it's sort of consultant, PR, lobbyist, all rolled into one.

Jeffrey 20:42

It's access. Access, yeah.

Aaron 20:45

Right?

Jeffrey 20:45

And, you know, and by the way... Which I love. So a colleague of mine, I have a couple of comparisons in mind, because one of the questions we were getting is, have you ever seen anything like this before? And the answer's like, not on the like, well, yes, but the example that a colleague of mine latched onto was, oh my God, it feels like a Ron Contra.

Aaron 21:14

Yeah, exactly. Well,

Jeffrey 21:17

Well, who's one of the national security, energy, and policy leaders? Bud McFarlane!

Aaron 21:23

He was the national security advisor during Iran-Contra.

Jeffrey 21:27

This is why I'm telling you, Flynn will be back. He will be rehabilitated. He'll get a nice job at CFR or Brookings or the Atlantic Council. And somebody's going to say something bad about him because of all the shit he's doing now and the time he may spend in prison. And... People are going to point that out, and they're going to be accused of being uncivil.

Because these motherfuckers never go away. Elliot Abrams is back. Bud McFarlane is back. And Michael Flynn will be back.

Aaron 22:02

Maybe that's the title of this podcast. You know, not getting rid of him. Yeah, it's a Terminator.

Jeffrey 22:09

I think... I don't think there was any chance that this proposal would have resulted, and we'll talk about what the actual proposal was, but I think as a first observation, there was no chance that this thing would ever have built a single reactor. And it doesn't need to for all these people to make a bunch of money.

Right, so that's my question.

Aaron 22:28

For them to wet their beaks, yes.

Jeffrey 22:32

Now, admittedly, I don't know where the money is coming from. Okay? So... I can't make any specific allegations, but I can observe, you know, that you can see kind of suspicions raised in the House report, right? So, for example, one of the things that the House report mentions is, Is that in March 2018, it was reported the Saudi government was spending more than $450,000 over a one-month period to lobby the Trump administration to approve a sale of nuclear reactors to Saudi Arabia.

Aaron 23:10

Right.

Jeffrey 23:11

I don't know that any of that money went to this, but I think that gives you a sense of the kind of amount of money that is sloshing around. Right. Yeah, yeah, yeah. You know, so like... My guess is a lot of these people to be on this board get paid?

Aaron 23:35

Yes. I mean, that is a typical arrangement, is it not? I would assume so. I mean, look, I don't make enough money to be asked to be on boards. Like, the boards I get asked to be on are like my HOA board.

Jeffrey 23:46

Right. So, you know, I don't know. But I don't... I would be really shocked if people were aiding IP3 in getting access without expecting something in return.

Aaron 24:04

I think that's fair, especially. I think that's a fair assumption to make.

Jeffrey 24:10

You know, and, you know, it might not be that much money. You know, I don't know. But I suspect that even if this thing had only gotten to the stage where... There was a special representative appointed for it, and there was lots of discussion. There probably would have been a lot of consulting going into this project before anything actually ever got built.

And, you know, some people could make a lot of money. There's actually a joke, by the way, which is... And it's a it's a joke told at the expense of French corruption, which actually is not as bad as American and other forms of corruption. So I mean, we pick on the French, but but but it kind of it reverses like an expectation.

You know, there's a there's a you know, it's like a. Proposal to build, for the French to build some piece of infrastructure in, in, a, in a lesser developed country, right? And so the, the French the French official in charge of it you know, is visiting you know, the, the relevant minister in this country, and the minister has this gorgeous house. It's incredible, beautiful, right?.

And the French official wants to know how a minister, right, afforded such a palatial residence. And he points out at a piece of infrastructure. I think when I heard it was an airport, but, you know, whatever. And he says, see that airport? And the French official says yes. And he says 10%. And the French official kind of smiles.

And, you know, the process goes on, right? And you're thinking this is a joke about, like, corruption in the lesser developed world. But it's not, because then that official, He comes and visits in France, and he goes to the French official's house, and it's far more palatial than his. I mean, it's incredible. And the official's like, well, I thought my house was nice, but this is incredible.

How do you afford this? And the French official does the same thing. He points out the window at this field and says, see that airport? And the foreign official says, no, there's no airport there. And the French official smiles, points at his house and says, 100%. I like that. You know, you can, I think the joke there being you can make a lot of money on infrastructure projects that don't get very far.

Right, of course. If you are in the consulting business, right? And I actually, I've been reading a little bit about infrastructure in different parts of the world. And, you know, you, you, There can be a lot of money front-loaded in contracts if you are a consulting firm. And my guess is that's where this thing existed.

Aaron 26:57

I could be wrong.

Jeffrey 26:59

Maybe they really were going to wait until the very end to make all their money only on providing cybersecurity at these points. Right, right. You laugh, right? It seems really unlikely.

Aaron 27:11

That's for somebody else floating around in this orbit, the cybersecurity czar. So, I mean, I think the point is there is like, so when I first saw this, I was like, how did they, and some of the tweets, I think a friend of the arms control one blog, Paul Kerr said like, they really thought that like, how are they going to hide 40 reactors?

And I think the point, like, I think the point is, is like, maybe they didn't actually ever want to export reactors. They just wanted the plan to get moving. If that makes sense.

Jeffrey 27:39

Yeah, I think that's right for them. And you know, when you actually look at the proposal at some level, It's pretty standard.

Aaron 27:47

Yeah, they're usually pretty wild. Well, not like this wild. Wild in terms of expectation setting, I should say.

Jeffrey 27:54

Yeah, that's right. And so this is a pretty standard like... I mean, there's some little wing nuttery baked into it, which we'll talk about. But like, it is a standard argument that U.S. nuclear industry makes when trying to export things, which is... The Russians and the Chinese and increasingly the South Koreans are making all these inroads exporting reactors.

And no one ever buys American reactors. And so what U.S. industry, which is just, it's not competitive is the problem. What U.S. industry wants is for the United States government to get involved on their behalf. And to promote U.S. reactor exports to countries that don't want to buy American reactors. And so, naturally, that runs into this kind of reluctance in the U.S. to promote... Like, generally, I mean, there are some businesses that we're good at promoting, but, like, often...

For a business like nuclear power, which isn't all that popular, it's much harder. And so they always make a proliferation argument. They say, oh, look, the Russians and the Chinese and the South Koreans, they don't care about proliferation. And so if we don't sell reactors, those countries are just going to buy those reactors from other countries, and then there will be no proliferation restrictions.

And so they try to present it as a non-proliferation agreement. Like, if the US dominated the market, we are so much more responsible, and we have such better laws. That we'll be able to reduce the proliferation risk. Which is a thing American industry always says, and it's a thing that I believe is manifestly untrue.

Aaron 29:35

Explain why that is.

Jeffrey 29:37

Well, I mean, for one thing, there are two questions here. One is, countries do want 1-2-3 agreements with the United States, because they see 1-2-3 agreements as a kind of seal of approval from the United States. But... A lot of countries will negotiate a 1-2-3 agreement with the United States and then won't buy reactors from the U.S. What they really want is the seal of approval.

Like the Emirates. Right. Right. They negotiate a 1-2-3 with the U.S. and they bought them from South Korea. And my guess is Saudi Arabia, which is negotiating a 1-2-3 agreement with the United States, which should be pretty close to being done, if they get that agreement, although it's very unlikely. Well, I shouldn't say it's unlikely to get through Congress because it's very low bar to get through Congress.

And nonetheless, the Saudis have made that... Made it very difficult for them to clear that low bar. So we'll see.

Aaron 30:23

Yes, they have. I mean, murdering a journalist and dismembering him and probably dissolving him in acid helps that along. Hey, building a missile plant. Building a missile plant. You know, CNS, Fabian Hinz, Jeffrey Lewis production. Yeah. All that stuff.

Jeffrey 30:38

Yeah. But my guess is the Saudis will buy them from the Russians or the Chinese.

Aaron 30:43

Or the South Koreans. I mean, why not the South Koreans?

Jeffrey 30:46

Because the Saudis have MOUs in place. Maybe not MOUs, but they have agreements in place with the Russians and the Chinese already.

Aaron 30:55

But yeah, maybe, maybe, maybe from the UAE.

Jeffrey 30:57

But, you know, there's a famous case, and I probably shouldn't mention the country. But, you know, one country I know came to the Department of Energy, and it's like a tiny little country. And they're like, we want a 1-2-3 agreement. And DOE told them, like, you don't need a 1-2-3 agreement. You know, everything that you're doing can be approved through what's called a Section 810 agreement, which is like a...

Which doesn't require congressional involvement, right? And so, you know, they were like, look, you're in the best possible situation. You don't need a 1-2-3 agreement for all the stuff you want. And they're like, no, no, you don't understand. We want a 1-2-3 agreement. Like, they wanted it for the... The... Prestige? Political approval it conferred upon their nuclear program.

Aaron 31:40

Right. Even the Americans say it's okay.

Jeffrey 31:43

That's right. So, you know, like, it is undoubtedly the case... That we can have these conversations with these countries about one, two, three agreements, and we can sometimes get, I mean, sometimes we have to get these things because they are required by U.S. law in terms of the restrictions that the agreement imposes. In the case of the UAE, we got a little more, although we're going to lose it because I think we're not going to get the, oh, you should know this.

The UAE agreed to forego enrichment and reprocessing.

Aaron 32:10

Yeah, it's the first publication of all time for the Nuclear Threat Initiative.

Jeffrey 32:14

Right. But it's contingent on no one in the region getting a better agreement. Yeah, of course. And the Saudis are about to get an agreement that probably does not include that restriction, which means the UAE restriction will be off.

Aaron 32:23

Yeah, or it'll be included in a way that doesn't make it binding, like in the preamble or something like that.

Jeffrey 32:28

And by the way, the reason the UAE did that was because they, at the same time, had the same kind of political problems as Saudi Arabia. Yes, Dubai World Ports. Yeah, and so they were trying to get it through. But the point of that is that... The idea that a strong advocacy by the United States government is going to result in lots and lots of reactor sales for Westinghouse, I think is absurd.

Correct. Because Westinghouse just is never competitive in these things. And so they're basically asking the U.S. government to put its thumb on the scales to help them out, which most of us don't want to do because, you know, most of us don't see any particular reason to subsidize this industry.

Aaron 33:10

Which is different than the other countries involved in these things, in particular Russia and the others.

Jeffrey 33:14

Right. Like, I don't care if Westinghouse exists as a company. Like, it's just not, like, don't care, not willing to pay money to make that happen. But then the other piece of that is in order to justify that, they make this, I think, specious argument that we somehow impose these great nonproliferation restrictions on these countries, which, I mean, they're not really that much stronger than...

Than IAEA safeguards.

Aaron 33:45

No, I mean, so like, this is the last, I mean, this is where we pivot to the last of the three points you mentioned. It's like the non-proliferation concerns over there. So like, I went back and listened to our last Saudi podcast, it was relatively recent, about Bin Bonsa and your discovery with Fabian of the solid missile plant.

And it's referenced in the House report, which is the Mohammed bin Salman statement about, again, I just want to read it so it's accurate. Like, if Iran gets nuclear weapons, we'll follow suit quickly. Something along those lines, right?

Jeffrey 34:21

Oh, well, you know, I mean, the argument they were making, which is just total f***. It was totally designed to appeal to Trump and other right-wing people, was that the JCPOA accelerated Iran's nuclear program and was going to generate a nuclear arms race in the Middle East. And so the way to solve that problem would be to build reactors all throughout the Middle East so that they were our reactors instead of the Russian reactors, and that therefore...

Would inhibit an arms race, which, by the way, is insane because reactors aren't the problem.

Aaron 34:54

Yeah, so that's where I wanted to go. So, like, okay, I'm going to read it just so that we have it completely accurate. So, like, in the report, and this was widely reported at the time, it was all over my Twitter feed, and particularly within the context of the JCPOA, like you said, without a doubt, quote, if Iran developed a nuclear bomb, we will follow suit as soon as possible.

And so... You have to worry about these statements, of course, as the Arms Control Podcast. We can't just dismiss them, but this sort of harebrained up to 40 reactor schemes is not how one would do it. Do you know what I mean?

Jeffrey 35:31

Well, I mean, the simplest thing to say is that Reactors themselves are not the problem. The problem is enrichment and reprocessing.

Aaron 35:39

Yeah.

Jeffrey 35:39

And I'm so pleased. On NPR, they were like, please don't kill us with details. I got in the words enrichment and reprocessing. I actually heard that.

Aaron 35:45

So I listened to it last night, and I knew you were talking in clip stents for those interview reasons to keep it simple, and you got it in. I actually noticed that.

Jeffrey 35:52

Yeah. And I could just tell, like... I had pushed it. I had pushed it as far as I was going to get away with it. I could actually slightly hear him draw breath to cut me off if I went too long.

Aaron 36:03

I actually know exactly what you're talking about. No, I know exactly what you're talking about because I picked it up. I was like, ooh, he got it in there. I know exactly what you're talking about.

Jeffrey 36:11

I had to ram the detail in. So the thing is, the big fight over the 1-2-3 agreement is whether the Saudis will agree like the UAE did to forego enrichment and reprocessing.

Aaron 36:24

That's what's delayed it, yes.

Jeffrey 36:27

If you don't want them to build nuclear weapons, that's the place to put your effort. And maybe, sure, as part of the 1-2-3 negotiation, the promise of access to U.S. technology might be a sweetener. But like this stupid proposal is nothing but a classic industry appropriation of nonproliferation arguments for them to sell a bunch of reactors. It doesn't actually have anything to do with nonproliferation.

Aaron 37:01

Well, I mean, but I think one thing we can say is that, you know, a lot of people haven't read one, two, three agreements. I mean, I've read a whole bunch, obviously. They're not very complicated. They're really f***ing boring. They're really boring, and there's not any special inspection provisions in the U.S. 123. I mean, it's the IAEA's safeguard mechanisms.

Jeffrey 37:25

There are some... Accounting mechanisms. Like, I don't want to say that there's nothing, but there are some accounting mechanisms, and even then, those are often not enforced.

Aaron 37:45

Yes, and it's about U.S. origin fizzle material for that. But I'm talking about sort of in general. That's right. Who inspects these plants? It's the IAEA. Inspect is even the wrong word. You know, like, who is... Oh, they're inspectors.

Jeffrey 37:57

You're inspectors.

Aaron 37:58

Oh, okay, okay. I mean, okay.

Jeffrey 37:59

I'm just trying to, like, for, like, people who have never... People have the wrong idea about inspections because they think inspections are like... Unscum or Unmavik. Yeah, whereas these are more... I mean, they're technically inspections, but they're... They're making sure that... They're designed... Go ahead. Oh, I was going to say, they're designed not to compromise the efficient commercial operation of the plant.

Aaron 38:23

Yeah, which was a U.S. demand, I believe. No, that was a European demand in the 1970s, I believe. Yeah, that's probably about right. I'm taking a soft spot. But my point is, I actually think that's an important detail, because it's not like the U.S. imposes... Really extra layers of non-proliferation norms or restraints in the 1-2-3, it's basically the IAEA is responsible for the inspections.

Jeffrey 38:51

Yeah, that's right. I mean, the real... Advantage we're getting is there are legal rights that the u.s has over u.s origin or actually no one says u.s origin anymore it's u.s obligated fuel that's one of those little jargon gatekeeping bits that's meant to keep people with contrary opinions from participating in the discussion but You know, those are just like, those are like legal rights, but the monitoring of those rights is not really that strong and not really that great.

And like, what are your enforcement options? You know, the U.S., right, the reason that the Canadian reactor, sorry, not Canadian, the reason the Indian reactor used in the first Indian nuclear test Is called Cirrus is that's Canada, India, U.S. Yeah, yeah, yeah. And the U.S. played a role in that, yeah. Right, right. I think we provided the fuel.

Yeah, the fuel. So technically we had some rights, but Saudi Arabia decides they're going to test a nuclear weapon. They're going to be like, okay, well, you can sue us.

Aaron 40:07

Yeah, or try and take it back, right?

Jeffrey 40:08

Yeah. So, you know, I mean, there was actually a GAO report in 2011, right, that is – I mean, the title says it all. U.S. agencies have limited ability to account for, monitor, and evaluate the security of U.S. nuclear material overseas.

Aaron 40:26

Yeah, I actually remember that report. Right.

Jeffrey 40:29

So – The idea that U.S. sales are somehow more secure than Russian sales.

Aaron 40:36

Or French or South Korean.

Jeffrey 40:38

I think is basically nonsense. I mean, there are particular reactor types that I would not like to see exported, like Canada, right, used to export can-do reactors, which are like proliferation nightmares. So, like, okay, don't, those sales would be worse.

Aaron 40:53

Well, we should talk about who licenses most of the designs that are used in modern reactors.

Jeffrey 40:58

Well, right, a lot of the, I mean, the South Korean and even the Chinese design, although they don't agree, is they're very American in their... The Chinese and South Korean designs are American in origin, and they're light-water reactors, and they just aren't... I mean, they are relatively proliferation-resistant. I mean, you can make a nuclear weapon with reactor fuel, so that's a whole other conversation.

But generally speaking, we don't worry about those so much as we worry about things like CANDU, where you get really nice plutonium for nuclear weapons, and then obviously we worry about enrichment and reprocessing. And so I just... The difference between a Russian... Reactor and a U.S. reactor in terms of its proliferation risk, I think is really quite low.

And so the idea that U.S. reactor sales will make the world much safer than Russian reactor sales, I just don't accept.

Aaron 41:52

I totally agree with that.

Jeffrey 41:54

Unless the Russians are selling copies of their plutonium production reactors, then we would have a problem.

Aaron 42:01

Which they're not. But they're not. I think the final point on this, to sort of link them all, to stitch them all together, you had the ethical thing, You had the legal thing, which is where if you – at this scale and barring some sort of legal shenanigans that we don't think they would come up with, you need the 1-2-3 agreement to export at this level.

But the – Non-proliferation extra goodies that you would get out of that 1, 2, 3 are on enrichment and reprocessing. And that is not yet agreed to, as far as we know, in the Saudi U.S. 1, 2, 3. So this is sort of all separate to that. You'd say that's a fair summary?

Jeffrey 42:45

Yes. But then I would tie them together. I mean, you're right that they are separate. But they are... One impacts the other, which is the reason that I am so bothered by the ethical... Potential legal and just competence questions, right? Is that you... Is that we have these export laws for a reason. Right. Right? And... The desire to run roughshod over them in pursuit of this poorly thought out, grandiose notion.

I called it bonker balls on NPR. It was so funny because the host was like, what kind of word is that? It's like, it's from wow in the world. It's the only part of NPR my kids listen to.

Aaron 43:32

You did say it was an NPR word.

Jeffrey 43:35

Yeah, I should have said it's a wow-in-the-world word, but I just couldn't. I was so caught off guard he didn't know it. Because Guy Raz, who's the host of this kids' show on NPR, is also a proper reporter. And the person who says it, Mindy Thomas, is kind of famous. How the hell do you not know this?

But the reason that we have these laws... And the reason that we have these policy approaches, like, they're boring, right? Nobody wants to read a freaking 1-2-3 agreement. Nobody wants to read the ENR, right, enrichment and reprocessing, the ENR provisions. But, like, they exist for a reason. And so when they are riding roughshod over all that, being like, no, no, you know, dozens of reactors, 40 reactors, we just want to do a lot of reactors.

I worry that in their enthusiasm to get rich and deal with this at this very high level, they're losing sight of the important thing, which is not letting countries in the region engage in enrichment and reprocessing. In the proposal that they're making, they do talk about taking the fuel back out, right? So they kind of at like some level recognize that the U.S. should do enrichment and the U.S. should arrange for like a spent fuel take back.

But it's such a half-baked plan, given the state of the U.S. enrichment industry and given the fact that we don't actually have any place to put the fuel, that one worries that they're so focused on the reactor sales and getting rich that they'll neglect one of those details. And somehow this will end up with the Saudis having an enrichment plant and that things are really...

Yeah, but I mean, right, because they don't care about things like the one, two, three agreement, you know, so it can say on the little piece of paper, like, oh, we'll figure out what to do with the fuel. But if you have a half-baked plan pursued, even in the face of contrary advice, like, what is your confidence that they will follow through?

With their half-baked plan for removing that spend fuel. If it's zero, which is what I have, then you have to worry that a reprocessing plant does get killed.

Aaron 46:03

I have to say, zero is a kind sort of giving of confidence. It's a kind confidence interval in terms of how competent I think that these people are in sticking to details and following through a well-thought-out, coherent plan. So you're like actually 100% sure they would fuck it up? Of course they would fuck it up. Are you kidding?

Look at this thing. Look at the report. I'm not kidding.

Jeffrey 46:26

100%.

Aaron 46:27

But yeah. I'm not kidding. So I think there's certainly more to come on this. And so I think we may revisit this. Oh, my God.

Jeffrey 46:33

There is more to come because they made the rounds in D.C. So we're going to see. We're going to see stuff.

Aaron 46:39

Yeah, so there'll be more. We're going to have to come up with a phrase like IP3 gets you a podcast-y. I don't know. We'll have to figure something out.

Jeffrey 46:49

Poorly thought out, get rich quick scheme gets you a pod.

Aaron 46:56

Yeah, I wanted to rhyme somehow, but yeah, something like that. One, two, three for the win. Sell a fuel rod, get a pod. Sell a fuel rod, get a pod.

Jeffrey 47:05

There you go. Certainly reprocess a fuel rod, get a pod. That's true.

Aaron 47:10

Yeah, yeah, yeah. But I think with that, we should close and give a plug for... To become a member of the Arms Control Wong community and to do that, you head on over to patreon.com slash acwpodcast. And if you're a student, for as little as $3 a month, you can get access to our exclusive Slack channel where we also have a second shorter pod called Brilliant Pebbles.

And there's going to be some news on that coming up this week. So stay tuned for that. That's a teaser for next week's show. And if you're not a student, it's just a $5 entrance fee. That's, again, patreon.com slash acwpodcast.

Jeffrey 47:50

And with that, I think I'd like to thank IP3 for providing us with a much longer than expected episode, but one worth discussing in details.

Aaron 48:00

With that, Jeffrey, thank you for joining me on this snowy day.