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The Arms Boom and How to Stop It

Controlling the Conventional Arms Race

by the United Nations Association
UNA, New York, 87 pp., $2.00

US Military Sales to Iran Committee on Foreign Relations, US Senate

A Staff Report to the Subcommittee on Foreign Assistance of the
US Government Printing Office, 59 pp.

There are very many things to be said against Jimmy Carter’s defense advisers. The most important has to do with Vietnam. The people Carter has chosen were involved closely and resolutely in the prosecution of the Vietnam war. These men march through the pages of the Pentagon Papers. They form a group portrait of the forces in America which prolonged the war. They played their parts: Harold Brown, as secretary of the air force, describing bombing targets in 1968; James Schlesinger at RAND, inventing war games; Brzezinski, the academic, debating on television to defend the war; Cyrus Vance, the troubled moderate in the Department of Defense, surviving the 1960s. Not one of the people who influence Carter’s defense policy stood in any public way for opposition to Kennedy’s and Johnson’s war.

But in one specific respect, the new men are different. They come into office committed to ending at least part of America’s involvement in the worldwide arms race, and in the worldwide boom in military spending. They are committed, in particular, to limiting the export of US arms. Carter himself said during the election campaign that he favored international agreements to limit arms sales, and that “I would not hesitate as president to assess unilateral reduction of arms sales overseas.”

An agreement to reduce international arms sales is possibly the most important objective that Mr. Carter could achieve. In 1976, as the newest Defense Department figures show, all the increase in US arms sales came from sales to developing countries, oil-exporting countries excluded. The most destitute countries—Kenya, Ethiopia, Yemen, Pakistan—are important US customers, and the list of clients grows each year. If an agreement to reduce such commerce were the prelude to a lasting international commitment to disarmament—including nuclear disarmament by the US and the Soviet Union—Carter’s government would be honored for many years to come.

Yet even the first steps will be enormously difficult. For the problem of arms sales is not a technical question, nor does it have to do only with foreign policies. It is not, as Carter suggested during the campaign, a matter of “making decisions on individual countries [so as to] effectuate our adopted foreign policy.” The origins of the US arms boom are to be found, rather, in the deepest changes in US economic relations with other countries, in the Nixon/Ford years and before; and in deep changes, too, in the US domestic defense industry.

The arms trade problem goes to the issue of disarmament itself. Throughout the postwar period, and in every civilized country, governments have come into power promising peace and a civil society: an end to the madness of militarism. Yet again and again, their protestations have been forgotten, thrown off as beyond hope. The Carter government, if it is serious about limiting arms trade, will have to find out why these earlier promises failed. It will have to look beyond the sorrows of disarmament to the military and economic power which outlives so many people’s hopes.

The boom in the arms business exploded in the annus mirabilis of 1974. The events of the year derived from choices made long before. But they also marked several sudden changes in the US arms trade.

The value of US exports. US arms sales more than tripled in two years, with foreign countries ordering $10.6 billion worth of US military equipment in 1974, as compared to $3.3 billion in 1972, and less than $1 billion in 1970. The figures for military orders in fiscal 1976, recently made public by the Defense Department, show that the arms boom persists. Foreign military sales orders are still worth more than $7 billion a year, although the figure is lower for 1976 than for 1975.1

US deliveries of arms to foreign countries—actual exports—are also increasing, as the backlog of orders is filled. Since 1975, the US has in fact made a profit on its worldwide military involvement. Twelve years after US combat troops arrived in Vietnam, the US government receives more money for its foreign military sales than it spends abroad on defense. The government’s “cash receipts associated with military sales contracts” were worth $4.1 billion in the first half of 1976, compared to $1.1 billion in the first half of 1974. Meanwhile “direct defense expenditures” overseas fell from $2.4 billion in 1974 to $2.2 billion in 1976.2

The direction of exports. The destination of US arms sales has moved from developed countries to oil-exporting countries and, most recently, to other, poorer developing countries. In the 1960s, European countries were the US arms companies’ leading foreign customers. After the 1973 oil price increases, OPEC countries accounted for 60 percent of US military orders, spending their new riches on missiles and air forces. But since 1975, sales to developed and oil-exporting countries have fallen, while sales to the poorest countries have increased.

According to Defense Department figures, the developing countries that do not export oil accounted for 24 percent of US military orders in 1976, compared to 10 percent in 1975 and only 5 percent in 1974. US orders from these countries increased from $240 million in 1972 to $2.3 billion in 1976. All continents were represented, with Africa the boldest new buyer. US sales to black African countries—almost all to Ethiopia, Kenya, and Zaire—increased over 800 percent in one year. These three countries’ orders were worth more than three times the value of all US arms sales to black African countries in their entire previous history. Kenya, in 1976, ordered more US arms than did Britain; Ethiopia, more than twice as many.

Aid and trade. The United States has supplied arms to its allies for generations. Since 1945, it has spent well over $60 billion on foreign military aid. But beginning in the late 1960s, most US arms exports have been sent as trade, not aid.

Most US military sales are still arranged between the US government and foreign governments. The Defense Department and the US armed services promote these sales; they supervise the corporations as they produce arms for export. Thus the factory of a US defense corporation, much like a General Motors plant producing parts for blue sedans and pink station wagons, might make parts for a Jordanian “Main Battle Tank,” a tank for the US Army, an Israeli tank, a tank for Saudi Arabia.3

But the importance of the arms corporations has increased enormously in the new commercial epoch. When most arms transfers were paid for by US taxpayers, Congress exercised much greater control over the export process. Now US companies and government arms salesmen collaborate in selling arms for dollars. It is the pantomime described in such vivid detail in the Senate multinationals subcommittee’s investigations of Lockheed, Northrop, Grumman.

The goods on offer. The US now exports some of its most elaborate military equipment, occasionally to countries which are neither allies nor friends. The Stockholm International Peace Research Institute’s yearbook for 1976, deploring the “spread of sophisticated weaponry,” counts forty developing countries with supersonic aircraft as compared to twelve in 1965, and twenty-four with long-range missiles, up from seven in 1965.

Iran, the US arms companies’ most lavish customer, is buying planes (the F-14 Navy fighter) and destroyers as advanced as or more so than those procured by the US services. The costs of another fairly advanced US weapon, the US Army’s “Lance” missile, are supported in part by sales to Israel, Belgium, and other countries: according to an army expert, the salaries of almost half of all the civilians who work for the army’s “Project Lance” office are paid by foreign buyers…. 4

The importance of exports. Export sales have in the 1970s become a serious part of the US arms companies’ business. Henry Kissinger described the process in the course of a 1975 encomium to the value of arms sales in the pursuit of “prosperity, justice and positive aspirations.” “Security assistance programs,” he explained, “contribute needed jobs to several sectors of our labor force. They help us maintain a more favorable balance of payments. And they permit our defense industries to achieve significant economies through scale of production—economies that are passed along through lower prices to our armed forces.”5

Since their colonial empires fell apart, France and Britain have each relied upon arms exports to support a domestic defense industry.6 The United States now is beginning to feel some of the same pressures. At the height of the Vietnam war, US arms exports were worth $1 billion per year, compared to US defense procurement of over $42 billion a year. Now, with US companies no longer sending planes to US forces in Vietnam (or even to Vietnamese forces), exports are worth some $4 billion a year in actual deliveries and twice that in orders, while procurement for US purposes is still $42 billion.

The arms boom is the fulfillment of a long process. The US arms trade began in earnest when President Kennedy came to power. Lieutenant Colonel David Morse, a former chief of international logistics for the Army Missile Command, suggests in Army magazine that the events of 1961 were decisive, when a former naval officer called Henry Kuss was appointed to head a new office of International Logistics Negotiations in the Defense Department. (“He divided his office into geographical teams, sent salesmen around the world…. He was accused of bullying allies into arms purchases with his gruff and direct manner.”)7

Kuss’s exertions were soon successful. From 1950 until 1963, foreign military sales accounted for only 9 percent of US deliveries of arms abroad, with the rest sent under the Military Assistance Program. By 1968 foreign sales were worth more than aid shipments, and the proportion of exports going as aid continued to dwindle. By the time President Johnson left office, the sales program was worth over $1 billion a year.

President Nixon inherited the arms boom. But he perfected it in his own idiosyncratic way. His policies, Lieutenant Colonel Morse writes, were “interpreted by many in government as giving full approval to an open-ended arms sales effort.” Two decisions were critical. In May 1972, on a visit to Iran with Henry Kissinger, Nixon told the Shah that he could buy either the F-14 advanced fighter, to be produced by Grumman for the US Navy, or the F-15 fighter designed for the air force by McDonnell Douglas; he also told the Shah that he could in the future buy any US weapons he wanted, nuclear arms aside. One year later, in June 1973, Nixon boosted the arms trade in another direction. He allowed the sale to Brazil of a smaller but nonetheless supersonic fighter, Northrop’s F-5E, reversing a long ban on sales of advanced US weapons to Latin America.

Corporate salesmen, in the Nixon years, took on more and more of Henry Kuss’s functions. When the sales program was restricted to a few countries—when the military leaders to be enticed were old pals from NATO exercises—the US military could handle much of the sales effort on its own. But once the US started to sell expensive armaments in thirty or forty countries, from Kuwait to Peru, the US government came to rely more and more upon the energies and expense accounts of salesmen working directly for the arms companies.

  1. 1

    Department of Defense, Foreign Military Sales Agreements, November 30, 1976. Agreements signed in the 1976 fiscal year—which lasted for fifteen months from July 1975 to the end of September 1976, because the US changed in 1976 from a system where the fiscal year begins in July to one where it begins in October—were worth $9,474 million.

  2. 2

    Defense Indicators, Department of Defense, October 1976.

  3. 3

    Jordan, Israel, and Saudi Arabia have all ordered the M-60 AI “Main Battle Tank,” according to the 1976 Stockholm International Peace Research Institute Yearbook.

  4. 4

    Foreign Arms Sales: Two Sides to the Coin,” by Lieutenant Colonel David Morse, Army, January 1976.

  5. 5

    Henry A. Kissinger, “Statement Before the House International Relations Committee on Security Assistance,” November 6, 1975.

  6. 6

    See my “The Boom in the Death Business,” The New York Review, October 2, 1975.

  7. 7

    David Morse, “Foreign Arms Sales,” Army, January 1976.

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