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Arms Transfers and Trade

Arms Transfers and Trade

Michael T. Klare

Arms transfers and tradeboth imports and exportshave been a significant issue in American foreign policy since the revolutionary war. During the Revolution and in the decades immediately following, the United States was primarily concerned with the import of arms, in order to equip its nascent military forces. Following the Industrial Revolution, however, the United States became a major producer of arms, and since then the principal question facing American policy-makers has been when and under what circumstances to permit the export of arms. The latter question has gained in significance over time as the United States emerged as the world's leading producer and exporter of conventional weapons (weapons that do not incorporate nuclear, chemical, or biological munitions).

Arms transfers are an important question for foreign policy because they bear on the military capability of the United States and on those states to which the United States chooses to provide (or to deny) instruments of war. When the United States was relatively weak and lacked the ability to manufacture weapons for itself, it needed to obtain arms from foreign sources in order to enhance the capacity of its military forces to over-come both foreign and internal enemies. Since the United States has emerged as a major military power, and acquired the ability to manufacture weapons of all types, its decisions on when and to whom to export arms have had a direct impact on the relative strength of other, less powerful nations.

This capacity to affect the military power of other states became a major factor in American foreign policy before and during World War II, when the United States chose to mobilize its immense arms-making capacity to help defeat the Axis powers, and again during the Cold War, when Washington sought to construct a global network of anti-Soviet states. In both cases, decisions on arms transfers were viewed by American policymakers as issues critical to U.S. national security, requiring assessment and approval at the very highest (usually presidential) level.

Although the end of the Cold War alleviated some of the urgency once associated with decisions regarding arms transfers, such transactions remained a significant factor in U.S. foreign policy. In the mid-1990s, for example, the United States arranged major new arms deliveries to Saudi Arabia, Kuwait, and the United Arab Emirates in order to enhance their capacity to resist attack by Iran or Iraq. And as China proceeded with a substantial buildup of its forces, the United States supplied Taiwan with increasingly sophisticated weapons.

At various times the question of when and under what circumstances to export arms has also been seen as a moral issue facing the United States. This is so because weapons are, by definition, instruments of violence, and so their transfer to another party is thought by many to entail some degree of responsibility for any uses to which they are put by their recipients. After World War I, for example, many Americans opposed the export of arms on the grounds that their sale contributed to the likelihood of war and also provided obscene profits to the "merchants of death." Similarly, during the Cold War some people objected to the sale or transfer of arms to pro-American dictators such as Anastasio Somoza of Nicaragua and Mobutu Sese Seko of Zaire (now the Democratic Republic of the Congo) who had been accused of egregious human rights violations.

For both security-related and moral reasons, arms transfers have become an important subject for international arms control negotiations. During the Cold War, for example, the United States conducted intermittent talks with the Soviet Union over proposals to restrict the flow of conventional arms to areas of conflict, such as the Middle East. And after the Persian Gulf War of 19901991, the United States and the Soviet Union held similar talks with the other permanent members of the United Nations Security Council (the P-5 negotiations).

Finally, it is important to note that arms exports are viewed by U.S. weapons manufacturersand their supporters in Congress, the military, and the business communityas a legitimate source of revenue. Although such considerations have always been viewed as being subordinate to matters of national security, several presidential administrations (most notably those of Richard Nixon, Ronald Reagan, and Bill Clinton) have embraced arms export promotion as a valid concern of American foreign policy. The purely economic dimensions of arms export policy have been accorded particular attention since the end of the Cold War, when the United States found itself in a less threatening international environment.

For all of these reasons, arms transfers and trade have been an importantand sometimes contentiousissue in U.S. foreign policy. Every American president since Franklin D. Roosevelt has had to direct considerable attention to this issue at one time or another, and it is likely that this will remain the case for all future presidents. As long as there are discrepancies in the military capabilities of states, and as long as nations continue to go to war with one another, arms transfer considerations will figure prominently in the security planning of the U.S. government.

FROM THE REVOLUTION TO WORLD WAR I

The original European settlers in what became the United States brought firearms with them for hunting and self-defense. Weapons were also imported from Europe to equip the militias formed in the English colonies in the seventeenth and eighteenth centuries to fight hostile Indian tribes and to resist incursions by the French and the Spanish. Later, many of these weapons were used by revolutionary forces to fight the British. There were never enough weapons to go around, however, and so the importation of arms from friendly European governments became a major priority for the Continental Congress and its overseas representatives, including Benjamin Franklin. Only when France agreed in 1778 to aid the American rebels with arms and troops was the success of the Revolution assured.

After the Revolution the infant Republic continued to rely on imported weapons for many of its military requirements. To reduce this reliance, Congress voted in 1794 to establish government-owned facilities for the manufacture of firearms. These installations, most notably the army arsenals in Springfield, Massachusetts, and Harpers Ferry, Virginia (now West Virginia), gradually acquired expertise in the mass production of rifles and carbines.

Although these facilities were largely able to satisfy government requirements during periods of relative calm, they could not produce sufficient weapons in times of waras during the War of 1812 and the Mexican War of 18461848. To supplement production at Springfield and Harpers Ferry, the War Department contracted with private gunmakers such as Robbins and Lawrence of Windsor, Vermont, and Remington Arms of Ilion, New Yorkthus giving a significant boost to the development of a commercial arms industry in the United States. Many of these firms failed or were absorbed by others when government contracts disappeared, but others survived by embracing new technologies and finding foreign customers for their innovative products.

When the Civil War broke out in 1861, the United States possessed a significant arms-making capacity. Together the various army arsenals and their civilian counterparts were capable of manufacturing hundreds of thousands of firearms per year. But even this impressive capacity was insufficient to satisfy the prodigious demands of war, and so both sides were forced to procure additional arms from abroad. Although both the Union and the Confederacy turned to foreign suppliers for a certain percentage of their military equipment, the need for imports was especially acute in the South. Because most of America's arms-making capacity was located in the North, the Union could satisfy a larger share of its military requirements from domestic factories than could the South. As a result, the Confederacy placed a greater emphasis on military imports than did the North, and both sides became engaged in an elaborate diplomatic struggle over arms transferswith the South seeking to procure weapons from sympathetic powers in Europe and the North seeking to persuade these states to deny arms to the rebels. In the end the Northerners prevailed in this contest, as the major European powerswhatever their political sympathieschose to eschew involvement in the conflict. This did not, however, deter the North from declaring a naval blockade of the South and deploying hundreds of ships in a determined effort to prevent the smuggling of arms to Confederate forces.

The Civil War, like the wars that preceded it, proved to be an enormous boon to the private arms industry. Once the war ended, however, the U.S. government sharply reduced its procurement of commercially manufactured weapons. To survive in this new environment, private arms companies such as Remington, Winchester, and Colt looked to the civilian market and to foreign customers for the orders needed to survive. This in turn spurred the introduction of new gun designs and manufacturing processes. As a result, American gun firms became adept at the mass production of cheap, reliable, and highly effective firearms.

Although the U.S. government did not always take advantage of this burgeoning capability, other governments were less inhibited. Samuel Remington, the president of Remington Arms Company, opened a sales office in Paris and secured lucrative contracts for the sale of rifles and ammunition to several European countries. Other U.S. firms, including Winchester, also obtained significant contracts from European governments. During the Franco-Prussian War of 18701871, for example, the French army ordered 100,000 rifles and 18 million rounds of ammunition from the Union Metallic Cartridge Company of Bridgeport, Connecticut (later a division of Remington Arms).

The capacity of American military firms to produce large quantities of weaponry in a relatively short amount of time was next tested in 1914, when World War I broke out in Europe. Although the U.S. government initially adopted a policy of neutrality in the conflict, President Woodrow Wilson allowed American firms to sell arms and ammunition to the Allied powers. Desperate to supplement their own manufacturing capabilities, Britain, France, and Russia then contracted with American companies to produce large numbers of guns and cartridges. The British, for example, ordered one million Enfield rifles from Remington. As one such order followed another, American military exports jumped from $40 million in 1914 to $1.3 billion in 1916 and $2.3 billion in the final nineteen months of war. This marked the first time that U.S. arms manufacturers played a truly significant role in the international weapons trade.

THE INTERWAR PERIOD AND WORLD WAR II

At first America's emergence as a major arms supplier was lauded as a significant contribution to the Allied war effort. Once the war ended, however, many Americans became fearful of U.S. participation in future European conflicts, and therefore opposed any activitiesincluding arms transfersthat conceivably might increase the risk of such involvement. The most significant expression of this stance, known as isolationism, was the Senate's 1920 rejection of the Treaty of Versailles, which established the League of Nations. The United States also refused to participate in other arrangements associated with the league, including the St. Germain Convention for the Control of the Trade in Arms and Ammunition (1919) and the Geneva Convention for the Supervision of the International Trade in Arms and Ammunition and in Implements of War (1925).

Although leery of international arrangements like the League of Nations, the United States was prepared to support disarmament efforts aimed at the prevention of great-power conflict. Most notable in this regard was U.S. participation in the Washington Naval Conference of 19211922, which aimed at setting limits on the naval capabilities of the major powers. Under the resulting Washington Naval Arms Limitation Treaty, ceilings were set on the total allowable tonnage of battleships and aircraft carriers in the fleets of the United States, Great Britain, Japan, France, and Italy. A follow-on treaty, signed at London in 1930, extended the tonnage restrictions to the cruisers, destroyers, and submarines of the United States, Great Britain, and Japan. Although not bearing directly on the issue of arms transfers, these measures represented a significant effort to reduce the risk of war by constraining the arms procurement policies of the major powers.

The American public's antipathy to involvement in overseas conflicts was also reflected in calls for prosecution of U.S. arms firms for their alleged role in fomenting World War I. Antiwar crusaders like Dorothy Detzer of the Women's International League for Peace and Freedom traveled the country, demanding a congressional investigation of the domestic weapons industry. Critical books and articlesmost notably The Merchants of Death (1934) by Helmuth Engel-brecht and Frank Hanighenfurther aroused public opinion. "Arms makers engineer 'war scares,'" Engelbrecht and Hanighen wrote in their widely popular exposé. "They excite governments and peoples to fear their neighbors and rivals, so that they may sell more armaments." In addition, "bribery is frequently associated with war scares" of this sort.

In response to these and other such charges, the U.S. Senate voted to establish the Special Committee Investigating the Munitions Industry in 1934. This body, headed by Senator Gerald P. Nye of North Dakota, was empowered to pursue allegations that American and European weapons producers had conspired to instigate World War I and other conflicts in order to stimulate the demand for weapons. The Nye Committee (as it was called) was also authorized to investigate other charges of wrongdoing by the international arms industry.

After conducting numerous hearings, the Nye Committee concluded that U.S. arms firms had, in fact, employed bribery to clinch overseas sales and had spread tales of imminent hostilities in order to play one prospective buyer off another; it did not, however, find that they had conspired to ignite World War I. In the end, the Senate investigation did not result in any legal action against American arms companies. It did, however, lead to the establishment of the U.S. Munitions Control Board, the first governmental agency charged with regulating the arms traffic. It also sustained the national mood of isolationism and helped ensure passage of the Neutrality Act of 1935, which compelled the president to impose an arms embargo on nations at war.

The Neutrality Act of 1935 was followed by the adoption of similar measures in 1936, 1937, and 1939. The 1936 statute banned U.S. loans to belligerents, and the 1937 measure extended the provisions of the two earlier statutes to civil warsa step that effectively precluded the sale of arms to the Republican government in Spain, then under attack from right-wing forces led by General Francisco Franco (and backed by the fascist governments in Germany and Italy). The 1939 act, passed at a time of growing tension in Europe, banned U.S. ships from carrying goods or passengers to belligerent ports, but allowed the United States to sell arms to friendly powers on a cash-and-carry basis.

Although they enjoyed strong support from Congress and the American public, the Neutrality Acts and related expressions of isolationism appeared increasingly constrictive to President Franklin D. Roosevelt at a time when the Hitler regime in Germany was accelerating its rearmament effort and pursuing a strategy of regional domination. While Roosevelt argued against repeal of the ban on arms transfers to belligerents in March 1939, when Hitler's armies overran Czechoslovakia, he changed his stance in September of that year, when Germany invaded Poland. Two months later, after Congress finally repealed the Neutrality Acts, Roosevelt authorized a series of cash-and-carry sales of U.S. arms to the European democracies.

A year later, following the fall of France, Roosevelt proposed a much more ambitious program of arms transfers, under which the U.S. government would lend, lease, or donate military equipment to the nations fighting Adolf Hitler. The new U.S. goal, Roosevelt told the nation on 29 December 1940, was to convert the United States into the "great arsenal of democracy," and thereby provide America's allies with the arms needed to defeat Hitler's armies. To fulfill this pledge, Roosevelt asked Congress to approve the Lend-Lease Act, which allowed the transfer of U.S. arms to friendly powers that lacked the funds to pay for them.

Although opposed by isolationists in Congress, the Lend-Lease Act was finally passed by a vote of 60 to 31 in the Senate and 317 to 71 in the House. Signed into law on 11 March 1941, it empowered the president to "sell, transfer title to, exchange, lease, lend, or otherwise dispose of" military articles to "any country whose defense the President deems vital to the defense of the United States." Congress initially appropriated $7 billion for this purpose, and later authorized total expenditures (by war's end) of more than $50 billionthe largest amount ever committed for arms aid until that time. The lion's share of this bounty, totaling $31.6 billion, went to Great Britain; the second largest share, worth some $11 billion, to the Soviet Union.

Ultimately, it was the direct involvement of U.S. soldiers and sailors, rather than the delivery of American weapons, that turned the tide in Europe and the Pacific. But U.S. arms transfers under the lend-lease program enabled America's alliesespecially Great Britain and the Soviet Unionto hold out through two years of unrelenting warfare until the full weight of American combat strength could be brought to bear. The lend-lease program also established the principleadhered to by all American presidents since World War IIthat arms transfers can play a significant role in enhancing U.S. national security.

THE COLD WAR

Following World War II many of the factories that had been devoted to military production during the fighting were converted back to their prewar, civilian uses. However, the cessation of fighting in Europe and Asia was not greetedas the end of World War I had beenwith a wave of revulsion against American arms makers. Instead, the nation's military industries were widely viewed as a major pillar of American military strength and an important source of technological innovation. Thus, when the Cold War began in earnest, most members of Congress were prepared to support a new round of arms transfers along the lines of the lend-lease program.

The resumption of U.S. arms aid to friendly powers abroad did not occur without prodding from the White House, however. With World War II barely concluded, many in Congress were at first reluctant to authorize significant military aid to the European powersfearing, as had their counterparts in the 1920s and 1930s, that this would eventually lead to U.S. military involvement in overseas conflicts. To overcome this resistance, President Harry S. Truman and his close advisers, including Secretaries of State Dean Acheson and George C. Marshall, sought to portray the expansion of Soviet power in eastern Europe and the Mediterranean as a vital threat to the Western democracies and, by extension, to U.S. national security.

The first significant test of U.S. attitudes on this issue came in early 1947, when Great Britain announced that it could no longer afford to support the royalist government in Greecewhich at that time was under attack from a communistbacked insurgency. Fearing that the loss of Greece to the communists would invite Soviet aggression in neighboring countries, including Turkey, President Truman concluded that it was essential for the United States to provide arms and military training to the Greek military. On 12 March 1947, Truman appeared before a joint session of Congress to request funding for this purpose. In what became known as the Truman Doctrine, the president articulated a new guiding principle for American foreign policy: "I believe that it must be the policy of the United States to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures."

As noted by many historians since then, this speech shaped U.S. security doctrine for the next several decades. Henceforth it would be the unquestionable obligation of the United States to provide economic, political, and especially military assistance to any nation threatened by Soviet (or Soviet-backed) forces. As the first expression of this principle, Congress voted $400 million in military assistance for Greece and Turkey on 15 May 1947; this was soon followed by the appropriation of even larger amounts for these two countries and for many others in Europe and Asia.

In time the transfer of arms to anticommunist governments abroad came to be seen in Washington as a critical component of "containment," the strategy that governed American foreign and military policy throughout the Cold War. As articulated by its original architects, containment held that the totalitarian Soviet system was forced by its very nature to seek domination over the rest of the world, and thus, in response, the United States had no choice but to join with other nations in resisting Soviet aggression. And because many of the nations on the periphery of the Soviet empire were too poor to provide for their own defense, it was up to Washington to supply the necessary arms and equipment.

This principle was given formal expression in the Mutual Defense Assistance Act (MDAA) of 1949. Signed into law by President Truman on 6 October of that year, the MDAA (later incorporated into the Mutual Security Act of 1950) gave the president broad authority to conclude mutual defense assistance agreements with friendly powers and to provide these countries with a wide range of military goods and services. In its initial authorization Congress awarded $1 billion to members of the newly formed North Atlantic Treaty Organization (NATO); $211 million to Greece and Turkey; $28 million to Iran, the Philippines, and South Korea; and $75 million for the "general area" of China. These appropriations were increased in subsequent years, reaching a peak of $5.2 billion after the outbreak of the Korean War.

These arms aid endeavors were accompanied, of course, by U.S. efforts to strengthen its own military capabilities. If a full-scale war were to break out, it was believed, the United States would have to provide the bulk of the required forces. But the initial tests of strength were assumed to take place in the border zones between East and West. As a result, much of U.S. diplomacy during the Cold War was directed at the establishment of military alliances with friendly states in these areas and at bolstering the defensive capabilities of their armies. The linkage between military aid programs and U.S. national security was formally articulated in National Security Council policy document number 68 (NSC 68) of April 1950. Described by Representative (later Senator) Henry Jackson as "the first comprehensive statement of national strategy," NSC 68 called on Washington to aid any nation that might conceivably fall under Soviet influence.

At first U.S. arms aid was given primarily to the NATO countries and to other friendly powers on the periphery of the Soviet Union and China, including Iran, South Korea, Turkey, and the Nationalist government on Taiwan. In later years such assistance was also supplied to friendly nations in Africa and Latin America. Between 1950 and 1967 the United States provided its allies with a total of $33.4 billion in arms and services under the Military Assistance Program (MAP), plus another $3.3 billion worth of surplus weaponry under the Excess Defense Articles program. The United States also sold weapons to those of its allies that were sufficiently recovered from World War II to finance their own arms acquisitions; between 1950 and 1967 Washington exported $11.3 billion worth of arms and equipment through its Foreign Military Sales program. (All of these figures are in uninflated "current" dollars, meaning that their value in contemporary dollars would be significantly greater.)

Although the basic premise of American arms transfersto strengthen the defenses of U.S. allies facing a military threat from the Soviet Uniondid not change over the years, many aspects of these programs underwent significant transformation. Thus, while the bulk of U.S. weaponry was originally funneled to the industrialized powers of Europe and Asia, by the late 1950s an increasing portion of these arms was being provided to friendly nations in what was then called the Third World. The primary impetus for this shift was Moscow's apparent success in using arms transfers to establish military links with Egypt (beginning in 1954), Syria (in 1955), Iraq (in 1958), and Cuba (in 1961). In order to combat the growing Soviet presence in the Middle East, Africa, and Latin America, Washington began supplying vast quantities of arms and ammunition to its own allies in these regions thereby triggering fresh Soviet arms transfers to its Third World clients, in what was to become an ongoing pattern of U.S.Soviet arms competition.

Although the primary objective of U.S. arms transfer policy during this period was to bolster the defensive capabilities of key allies, American leaders did on occasion emphasize other priorities. In the early 1950s, for example, the United States joined with Great Britain and France in restricting arms deliveries to the Middle East. As noted in the 1950 Tripartite Declaration, the aim of this effort was to prevent the outbreak of an uncontrolled and destabilizing arms race in the region. (This effort collapsed in 1954, when the Soviet bloc began selling arms to Egypt and the United States responded by increasing its arms deliveries to Israel and other friendly powers in the area.)

In another attempt at restraint, the Kennedy administration attempted in the early 1960s to dissuade Latin American countries from acquiring expensive, "big-ticket" weapons such as jet fighters and armored vehicles. Believing that persistent underdevelopmentrather than the distant threat of Soviet powerrepresented the greatest threat to these states' long-term stability, President John F. Kennedy suggested that any funds saved by reducing arms imports be devoted to economic and social development. When supplying U.S. arms to these countries under the MAP program, moreover, Kennedy favored the transfer of "counterinsurgency" gearsmall arms, light vehicles, helicopters, and so on.

For the most part, however, U.S. policymakers favored a liberal approach to arms transfers, permitting the flow of increasingly costly and sophisticated arms to American allies in Europe, Asia, and the Middle East. This policy was strongly backed by U.S. military leaders, who saw arms transfers (and their accompanying training and advising operations) as a valuable instrument for establishing and nurturing ties with the military elites of friendly countries. It also enjoyed strong support from the domestic arms industry, which consistently opposed any restrictions on the sales of weapons to friendly powers abroad.

THE VIETNAM WAR AND THE NIXON DOCTRINE

Although the principal recipients of U.S. arms aid in the 1950s were the NATO countries and other friendly powers on the periphery of the Soviet Union, in the early 1960s, Washington began to direct considerable attention to Southeast Asia, where communist insurgents had become increasingly active. In line with the Truman Doctrine and NSC 68which viewed a gain by communist forces in any part of the world as a strategic defeat for the Westthe Kennedy administration established major military aid programs in Cambodia, South Vietnam, and Thailand. By 1975 U.S. military aid to these countries came to an estimated $18 billion.

As the fighting between insurgents and government forces in South Vietnam intensified, the United States sent ever-increasing quantities of military equipment to the South Vietnamese army, along with large numbers of U.S. military advisers. By doing so, Washington hoped to avert direct U.S. military involvement in the conflict. As the insurgentsbacked by increasingly powerful forces sent from North Vietnamgained in strength, however, U.S. leaders determined that it would be necessary to deploy American combat forces to prevent the collapse of the South Vietnamese government. At the peak of the conflict in the late 1960s, some 550,000 U.S. soldiers were serving in Vietnam. But when U.S. intervention failed to produce a quick and decisive victory, the American public turned against the war and U.S. forces were eventually withdrawn.

The American failure in Vietnam had a profound impact on U.S. foreign and military policy. Probably its longest-lasting consequence was to engender a deep-seated antipathy on the part of the American people to the long-term commitment of U.S. ground troops to ambiguous conflicts in the developing worlda reluctance that shaped U.S. strategy in the Gulf War of 19901991 and the Kosovo conflict of 1999. Congress also grew leery of major arms-supply arrangements with unpopular Third World regimes. In 1968, for example, the Foreign Assistance Act was amended to require a reduction inU.S. military aid to any underdeveloped country that diverted excessive funds to the acquisition of sophisticated military hardware. Subsequent amendments also prohibited the provision of military assistance to governments cited for egregious human rights violations.

But while Congress was reluctant to approve any increase in U.S. military assistance to repressive Third World countries, it also sought to prevent the deployment of U.S. combat forces in these areasand so could be persuaded in some cases to sacrifice one goal for the other. This was the genesis of the Nixon Doctrine, which called for the substitution of U.S. arms aid for American troops in unstable areas deemed essential to U.S. security.

As articulated by President Richard Nixon in 1970, this policy held that the United States "shall furnish military and economic assistance when requested and as appropriate" to friendly nations that come under attack in remote areas of the world. But, at the same time, the United States would "look to the nation directly threatened to assume the primary responsibility of providing the manpower for its defense."

Initially, the Nixon Doctrine was said to apply to the nations of Southeast Asia and the surrounding region. Before long, however, the main focus of this policy was shifted to the Persian Gulf, where Great Britain had long served as the regional hegemon. When Prime Minister Harold Wilson announced that London would withdraw its forces from the Gulf by the end of 1971, the Nixon administration undertook an immediate review of American strategy in the area. Believing that the U.S. publicstill in the throes of the Vietnam debatewould not tolerate the deployment of American forces in the Persian Gulf, the White House concluded that U.S. strategy would have to rest on the supply of weapons to friendly powers.

The administration's new policy toward the Gulf was spelled out in National Security Council Decision Memorandum number 92 (NSDM-92). Although the text of this document was never made public, its basic thrust was later articulated in congressional testimony by Undersecretary of State Joseph J. Sisco. "What we decided," Sisco told the House Committee on Foreign Affairs in 1973, "is that we would try to stimulate and be helpful to the two key countries in this area namely, Iran and Saudi Arabiathat, to the degree to which we could stimulate cooperation between these two countries, they could become the major elements of stability as the British were getting out."

As suggested by Sisco, this policy was aimed at both Iran and Saudi Arabia. In practice, however, the greater emphasis was placed on Iran. This was so because Iran's armed forces were considered far more capable than those of Saudi Arabia, and because its leader, Shah Mohammad Reza Pahlavi, was more attuned to U.S. policy objectives. Eager to enhance his nation's status as a regional power and to attract the support of Washington, the shah ordered $20 billion worth of American arms between 1970 and 1978at that time a record for weapons acquisitions by a developing country. Indeed, Representative GerryE. Studds of Massachusetts went so far as to state that these transfers constituted "the most rapid buildup of military power under peacetime conditions of any nation in the history of the world."

Although U.S. sales to Iran were motivated primarily by national security considerations, as spelled out in NSDM-92, the Nixon administration was not unmindful of the economic dimensions of arms exports. Facing a significant balance-of-payments crisis as a result of Vietnam War expenditures and the OPEC oil price increase of 1973, the White House saw in military sales a practical means for recouping some of the massive dollar outflows. Accordingly, U.S. arms firms were given a green light by Nixon to provide the shah with some of America's most advanced and sophisticated weapons, including F-4, F-5, and F-14 aircraft.

So massive were U.S. arms transfers to Iran at this time that many members of Congress became alarmed at the scale of the sales program and its potential for abuse. These concerns were increased by reports that U.S. weapons firms had employed bribery to solicit major orders from Iranrecalling the sort of charges made by Engelbrecht and Hanighen in 1934and that U.S. officials had failed to impose any limits on the sophistication of the arms that could be supplied to that country. After investigating these charges, the Senate Foreign Relations Committee concluded in 1976 thatU.S. arms sales to Iran were "out of control."

This report, and others like it, led Congressfor the first time since the 1930sto adopt significant legislative restraints on U.S. military sales abroad. Under the Arms Export Control Act (AECA) of 1976, Congress gave itself veto power over all individual arms transfers worth $14 million or more and over all munitions packages worth $50 million or more. The AECA also required the White House to provide Congress with advance notice of pending arms agreements, and placed restrictions on the "re-transfer" of U.S. arms from their intended recipient to another country.

CARTER AND REAGAN

The issue of profligate arms sales to Third World countries arose in the presidential campaign of 1976. "I am particularly concerned by our nation's role as the world's leading arms salesman," then-governor Jimmy Carter told the Foreign Policy Association in New York. Arguing that "the United States cannot be both the world's leading champion of peace and the world's leading supplier of the weapons of war," he promised that, if elected president, he would work to "increase the emphasis on peace and to reduce the commerce in arms."

Once elected, Carter renewed his promise to reduce U.S. weapons sales. In his first interview as president, he told reporters that the National Security Council had reached agreement on the need to place "very tight restrictions on future commitments" of U.S. arms to overseas recipients. These restrictions were contained in Presidential Directive 13 (PD-13), adopted on 13 May 1977. In announcing the provisions of PD-13 on 19 May 1977, President Carter affirmed that "the United States will henceforth view arms transfers as an exceptional foreign policy instrument, to be used only in instances where it can be clearly demonstrated that the transfer contributes to our national security interests."

To implement this "policy of arms restraint," as he termed it, Carter imposed a ceiling on the total dollar value of U.S. arms transfers (set at the sales level for 1977) to all but a few traditional allies, and pledged that the United States would not be the first supplier to introduce into Third World areas "newly developed, advanced weapons systems which could create a new or significantly higher combat capability." Moreover, to dampen the overseas demand for U.S. weapons, Carter ordered American diplomats to refrain from assisting U.S. arms firms in their efforts to secure foreign buyers. (This instruction was incorporated in the "leprosy letter" of 31 August 1977, sent to all U.S. embassies and military missions abroad.)

For the next three years Carter struggled to preserve his self-imposed ceiling on the dollar value of U.S. arms exports to nonexempt countries and to fulfill the other aspects of his policy. In Latin America, for example, he reintroduced the ban on sales of high-technology weaponry first instituted by President John F. Kennedy. He also succeeded in reducing total U.S. sales to non-NATO countries from $9.3 billion in fiscal year (FY) 1977 to $8.6 billion in FY 1978 and $8.4 billion in FY 1979.

From the beginning, however, Carter came under intense pressure from both domestic and international forces to abandon his arms restraint policy. At home he was besieged by supporters of Israel, who sought to exempt that country from any of the restrictions on high-technology arms exports. The domestic arms industry also campaigned strenuously against the restrictive provisions of PD-13. Overseas the president's determination to adhere to these provisions was undermined by growing Soviet assertiveness in the Third World, most notably in Afghanistan. Buffeted on both sides by antagonistic forces, Carter decided to abandon the arms ceiling in 1979.

Even before announcing this decision, Carter had made a virtual about-face on the arms export issue. In February 1978 he authorized the transfer of two hundred advanced combat aircraft to three countries in the Middle East-supplying sixty F-15s to Saudi Arabia, fifty F-5Es to Egypt, and a combination of ninety F-15s and F-16s to Israel. Six months later he gave preliminary approval to the sale of another $12 billion worth of high-tech weaponry to Iran. Other major sales of this sort were announced in the final months of his administration.

The changing international environment doomed another key aspect of the Carter policy: a determined U.S. effort to persuade the Soviet Union to agree to mutual restraint on arms exports to the developing areas. Between December 1977 and September 1978, the United States and the Soviet Union held four meetings to consider restrictions of this sort. Known as the Conventional Arms Trade Talks (CATT), these negotiations produced consensus on certain matters of principle and terminology, but never resulted in agreement on specific control measures. With superpower tensions rising in the Middle East and elsewhere, the two sides discontinued the talks at the end of 1978.

Ronald Reagan, who became president in 1981, repudiated what little survived of the Carter arms policy and promised to expand U.S. military aid to threatened allies abroad. His administration's revised, pro-sales stance was initially spelled out in a speech by Undersecretary of State JamesL. Buckley before the Aerospace Industries Association on 21 May 1981. Rejecting the notion that arms sales are "inherently evil or morally reprehensible," Buckley affirmed that "this administration believes that arms transfers, judiciously applied, can complement and supplement our own defense efforts." These views were incorporated into a new presidential directive on arms transfers, signed by Reagan on 8 July 1981.

In contrast to the Carter directive on arms transfers, the Reagan policy did not portray the global arms flow as a potential threat to international peace and stability. Rather, U.S. arms exports were described as a vital adjunct to America's efforts to counter (what was seen as) the growing power and assertiveness of the Soviet Union. As Undersecretary Buckley explained on 21 May, "We are faced not only with the need to rebuild and modernize our own military forces, but also to help other nations in the free world to rebuild theirs."

In line with this outlook, Reagan repudiated the arms-export ceiling set by President Carter and abolished the ban on sales of high-tech weapons to friendly Third World nations. The new administration also eased the repayment terms for any U.S. arms purchased by developing countries with credits supplied through the Foreign Military Sales (FMS) program. And, in a move that was eagerly sought by American arms manufacturers, Reagan rescinded the "leprosy letter" of 31 August 1977, and instructed U.S. diplomatic personnel to assist American military firms in securing contracts abroad.

As a result of these and similar initiatives, U.S. arms exports soared during the Reagan era. According to the Department of Defense, military sales under the FMS program jumped from $8.2 billion in FY 1981 (the last year affected by the Carter policy) to $20.9 billion in FY 1982a one-year increase of 155 percent. In addition to condoning a dollar increase in military exports, the Reagan administration approved the sale of some of America's most sophisticated aircraft, missiles, and tanks to Israel, Saudi Arabia, and other favored clients in the developing areas. All told, the United States exported approximately $92 billion worth of arms and military equipment during the Reagan era.

For the most part, President Reagan enjoyed strong congressional support for his efforts to boost U.S. arms sales abroad. He did, however, encounter significant opposition to a number of specific transactions. Most notable in this regard was his 1981 plan to sell five Advanced Warning and Control Systems (AWACS) aircraft, along with other sophisticated weapons, to Saudi Arabia for $8.5 billionthe largest single U.S. arms package until that date. Many members of Congress, including a substantial number of Republicans, announced their intention to block the AWACS sale in accordance with the veto provisions of the Arms Export Control Act, on the grounds that it would pose a potential threat to the security of Israel. Only after a major lobbying campaign by the president was the White House able to defeat the veto effort in the Senate by the narrow vote of 5248.

Aside from the AWACS sales to Saudi Arabia, the arms transactions of the Reagan era that provoked the most controversy involved the covert delivery of weapons to anticommunist insurgents in countries ruled by allies of Moscow. As part of his drive to combat Soviet influence in the developing areas, President Reagan authorized the transfer of arms and ammunition to the Islamic mujahideen in Afghanistan, the rebel forces of Jonas Savimbi in Angola, and the anti-Sandinista contras in Nicaragua. Although these efforts were supported by some in Congress, the covert arms program provoked a major national crisis when it was discovered in 1986 that the National Security Council staff had sold U.S. anti-tank missiles to archenemy Iran, then ruled by the Ayatollah Khomeini, in order to finance arms deliveries to the contras. In what became known as the Iran-Contra affair, the administration's covert arms program came under intense congressional scrutiny and was subjected to a number of severe constraints.

THE GULF WAR AND BEYOND

Until 1990 U.S. arms exports were largely governed by Cold War priorities and a desire to reap the economic benefits of military sales. During all the years in which the United States and the Soviet Union competed for political influence in Third World areas, arms transfers were viewed in Washington as an indispensable tool of foreign policy-thus making reductions of the sort envisioned by President Carter nearly impossible to implement. With the end of the Cold War, however, the national security justification for arms transfers lost some of its persuasiveness, and greater emphasis was placed on the economic justification for export sales. This, however, exposedU.S. arms sales to objections of a moral nature, like those articulated after World War I. And, indeed, international events were to lend fresh vigor to these sorts of concerns.

The Cold War was still winding down in August 1990 when Iraqi forces commenced their invasion of Kuwait. Observers were initially struck by the speed and brazenness of the invasion, which could only be viewed as a willful violation of international law. But another aspect of the invasion also sparked international attention: the fact that Iraqi forces were equipped with very large numbers of sophisticated weapons that had been obtained from foreign suppliers. During the previous eight years Iraq had spent an estimated $43 billion on imported weapons, giving it the most modern and powerful arsenal of any nation in the developing world. Many of these arms were supplied by the Soviet Union (long Iraq's major supplier), but others were acquired from France and other Western countries. This led to widespread charges that the major suppliers bore some degree of responsibility for Iraq's aggressive behavior, in that they had provided the means for mounting the 1990 invasion. Thus, when the Gulf War concluded in late February 1991, many international figures called for the adoption of new multilateral restraints on the transfer of arms to areas of conflict.

In response to these pressures, representatives of the five permanent members of the UN Security Council (the P-5 powers) met in Paris in July 1991 to address the problem of conventional arms transfersthe first multilateral discussions of this sort since the failed CATT negotiations of the 1970s. At the end of the meeting, the P-5 delegates issued a communiqué in which they pledged to develop new controls on the arms trade. For the first time these countries acknowledged that "indiscriminate transfers of military weapons and technology contribute to regional instability," and that, as the world's leading suppliers of such items, they bore "special responsibilities" to practice restraint. With this in mind they promised to develop a set of "agreed guidelines" for a regime of mutual restraint.

At a second meeting of the P-5 nations, held in London on 1718 October 1991, the delegates adopted a formal set of guidelines for conventional arms restraint. While reserving the right to provide arms to established states for the purpose of legitimate self-defense, they agreed to avoid transfers that would be likely to "(a) prolong or aggravate an existing armed conflict; (b) increase tension in a region or contribute to regional instability; (c) introduce destabilizing military capabilities in a region." But, although they were united on these basic points, the P-5 states still had to establish formal criteria and procedures for their effective implementation. This task was left to subsequent meetings, to be held in 1992.

Before the P-5 states could meet again, however, domestic politics in the United States intruded into the process. As the November 1992 presidential election approached, President George H. W. Bush (then trailing in the national polls) agreed to sell 150 F-16 fighter planes to Taiwan, thus providing a significant economic boon to Texas (where the planes would be built). Although of dubious political benefit to Bush (who subsequently lost the election), the F-16 sale to Taiwan greatly angered China, which immediately withdrew from the P-5 negotiations. With China out of the picture, the other participating states saw no reason to proceed on their own, and the talks were suspendednever to be revived.

In his final months in office, Bush approved a number of major military sales abroad, claiming they served to enhance U.S. security by bolstering the forces of friendly nations in strategic areas, especially the Middle East. Arguing that the United States would need to rely on the support of Kuwait, Saudi Arabia, and the United Arab Emirates (UAE) in any future encounter with Iraq, he authorized the sale of billions of dollars' worth of advanced aircraft, missiles, and armored vehicles to these three countries. In justifying these sales, Bush was not inhibited about touting the economic advantages of such transactions; at the same time, however, he sought to breathe new life into the national security arguments of the Cold War period by emphasizing their application to the new realities of the postCold War era.

Many of these sales were announced during the 1992 presidential campaign, and so it is hardly surprising that Democratic candidate Bill Clinton expressed concern over the magnitude of U.S. arms exports. Moreover, after winning the election, Clinton indicated that he would take a fresh look at American arms transfer policies. This suggested to some that he would resurrect some of the restrictive policies of the Carter administration. Once in office, however, Clinton followed essentially the same path as his predecessorapproving major sales that benefited American arms manufacturers while supporting U.S. security objectives in vital areas, such as the Middle East and the Pacific Rim.

To provide greater coherence to U.S. policy in this area, Clinton appointed a special commission on conventional arms exports. On the basis of this review, he announced a new conventional arms transfer policy on 17 February 1995. Reiterating many of the arguments made by previous administrations, the Clinton policy embraced both the security and the economic justifications for military sales. With respect to the latter, the policy specifically mandated that "the impact on U.S. industry" of pending sales was to be taken into account when deciding on future transactions.

In line with this policy, Clinton approved a series of major arms sales to friendly nations in the Persian Gulf area. Arguing that the United States had vital security interests in this regionnotably the free flow of oiland that these countries would be called on to assist U.S. forces in the event of an attack by Iran or Iraq, Clinton authorized the transfer of $46.5 billion worth of military hardware to the Middle East in 19932000an amount that represented about three-fourths of the total value of all U.S. military transfers to the developing world. Saudi Arabia was the principal beneficiary of this largess, obtaining 72 advanced F-15XP Eagle jet fighters, 150 M-1A2 Abrams tanks, 12 Patriot air-defense missile batteries, and thousands of missiles of various types; Kuwait obtained 6 Patriot missile units, 256 M-1A2 Abrams tanks, and 16 AH-64 Apache attack helicopters; and the UAE obtained 10 AH-64s and 80 F-16 fighters.

By the time Clinton left office in early 2001, arms transfers had come to be seen in Washington as a normal, legitimate aspect of U.S. foreign policy. The United States completely dominated the international market, providing about two-fifths of all weapons transferred to developing countries in the 19921999 period (measured in dollar terms). Although Clinton encountered opposition to a number of specific transactions in Congressfor example, the sale of advanced jet fighters to Latin American countriesmost lawmakers endorsed the basic premises of U.S. arms export policy.

Little change in this picture was expected when George W. Bush entered the White House in 2001. Even more than Clinton, the younger Bush emphasized the centrality of national security considerations in the shaping of U.S. foreign policya stance that typically has entailed a predisposition to provide favored allies with large quantities of sophisticated weaponry. Indeed, Bush signaled his support for this approach in April 2001, when he approved the sale of four missile-armed warships and eight diesel-powered submarines to Taiwan.

But while most senior U.S. policymakers generally harbor a relaxed attitude toward arms transfers, the historic concern over the moral implications of such exports has not disappeared altogether. Many peace, human rights, and religious organizations continue to argue that foreign military sales undermine American values and interests by enhancing the repressive capabilities of authoritarian governments, by fueling local arms races in areas of tension, and by encouraging states to seek military rather than negotiated solutions to their disputes with others. These concerns have surfaced in a number of legislative proposals introduced by sympathetic members of Congress, and in occasional newspaper editorials. Whether they will have any impact on future policy remains to be seen, but such efforts are likely to remain an important feature of the national debate over U.S. foreign policy.

BIBLIOGRAPHY

Grimmett, Richard F. Conventional Arms Transfers to Developing Nations, 19932000. Congressional Research Service Report to Congress. Washington, D.C., 2001. See also earlier editions of this annual publication.

Hammond, Paul Y., David J. Louscher, Michael D. Salomon, and Norman A. Graham. The Reluctant Supplier: U.S. Decisionmaking for Arms Sales. Cambridge, Mass., 1983.

Harkavy, Robert E. The Arms Trade and International Systems. Cambridge, Mass., 1975.

Hartung, William D. And Weapons for All. New York, 1994.

Klare, Michael T. American Arms Supermarket. New York, 1984.

Krause, Keith. Arms and the State: Patterns of Military Production and Trade. Cambridge, U.K., 1992.

Laurance, Edward J. The International Arms Trade. New York, 1992.

Neuman, Stephanie G., and Robert E. Harkavy, eds. Arms Transfers in the Modern World. New York, 1979.

Pierre, Andrew J. The Global Politics of Arms Sales. Princeton, N.J., 1982.

Stockholm International Peace Research Institute. SIPRI Yearbook 2000: Armaments, Disarmament and International Security. London, 2000. See also earlier editions of this annual publication.

Thayer, George. The War Business. New York, 1969.

Zwoll, Wayne van. America's Great Gunmakers. South Hackensack, N.J., 1992.

See also Arms Control and Disarmament; Balance of Power; Containment; Covert Operations; Foreign Aid; Militarism; Terrorism and Counterterrorism.

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