The Pentagon Bleeds the Third World

...industries...

...Spurred by these programs and the aggressive promotional activities of "advisory" personnel, Third World governments bought U.S...

...In response to the resistance of Congress, the Administration has been unremitting in its search for interim measures permitting increased military sales in this hemisphere...

...U.S...

...These elites are increasingly eager to acquire the modern aircraft and other advanced hardware that they consider primary symbols of power and success—a phenomenon that U.S...

...The phenomenal growth of U.S...

...Even this impressive gain, however, was soon to be overshadowed by the phenomenal sales growth realized during the Nixon Administration...

...The U.S...

...The United States, in turn, has been compelled to liberalize its export policies so as not to lose its customers in these areas...

...The Punta del Este declaration was never taken to heart by the hemisphere's military leaders, most of whom consider counterinsurgency to be a secondary— if not demeaning—function, and who did not share Washington's approach to modernization...

...Political Influence: Arms sales, like military assistance grants, are considered an effective tool for strengthening the bonds of dependency that tie Third World arms recipients to their suppliers among the advanced industrial nations...

...military sales to the region to regain sufficient political leverage to persuade them to spend less on arms: "When we have been unable to sell U.S...

...Their arguments were received favorably in the White House...

...1950-1972 total: $1.1 billion...

...This reversal is most pronounced, perhaps, in the case of Latin America...

...Commercial sales totaled $3.2 billion between 1964 and 1972 (data for preceding years are unavailable...

...aircraft to wealthy Third World governments...

...Only when the NATO partners had completely rebuilt their war-shattered economies did Washington ask them to pay for the military equipment they were receiving in such abundance...

...And although some analysts have questioned the actual value of such leverage (long-established client relationships have been sundered by Third World countries in response to changing political loyalties), the Pentagon argues insistently that increased arms sales are necessary to preserve American influence in areas where arms competition is brisk...

...In a discussion of U.S...

...Under Section 4 (Conte-Long Amendment) of the Foreign Military Sales Act, the Pentagon is prohibited from furnishing credits for sale of "sophisticated weapons systems" to all underdeveloped countries (except "forward defense countries" on the borders of China or the U.S.S.R...

...purchases from $44.4 million in 1969-1970 to $144.5 million in 19711972—a 225 per cent increase...

...military strength abroad is to be achieved without precipitating the collapse of pro-U.S...

...military aid policy in 1967, Secretary McNamara told Congress that "our primary objective in Latin America is to aid, where necessary, in the continued development of indigenous military and paramilitary forces capable of providing, in conjunction with the police and other security forces, the needed domestic security...

...Since most countries seek to acquire the most modern weapons available, they have been forced to buy from the handful of nations which possess a modern armaments industry...

...Constandy reminded of the close association between military strength and political power in the advanced countries (and in such contested areas as the Middle East and Southeast Asia), they acquired an understandable appetite for modern arms, including advanced fighter aircraft...

...To forestall this eventuality, many companies launched intensive export drives designed to find foreign customers for their Vietnam hardware...

...This is most apparent in the Middle East, where current U.S...

...nullify wholly the policies which had governed U.S...

...currency becomes an independent source of power and a potential threat when one considers the fragile condition of the international monetary system: even $10 billion— if unloaded on the money market all at once—could precipitate a major financial crisis, while, alternatively, it could be used to buy up entire U.S...

...Such sales must be approved by the State Department's Office of Munitions Control...

...This penurious outlook was formalized at the April 1967 Punta del Este Conference where, under prodding from President Johnson, Latin American leaders affirmed "their intention to limit military expenditure in proportion to the actual demands of national security...

...Department of Defense figures, Latin America spent $1.2 billion on European arms between 1968 and 1972, while spending in the United States amounted to $335 million...

...Third Country" Arrangements : Sales or transfers from one country (which has received them in previous arms transactions with the United States) to another country...

...lenders for foreign arms sales that are backed by Pentagon guaranties...

...In response to the growing national weariness with the Indochina war, and to what it considered excessive Presidential control over the management of foreign affairs, Congress—led by the Senate Foreign Relations Committee—adopted several stiff restrictions on sales of advanced armaments to Latin America...

...In a 1969 statement of the Senate Subcommittee on Western Hemisphere Affairs, Assistant Secretary of State Charles A. Meyer suggested that "Latin Americans have become puzzled and even suspicious of our motives...

...One strategy that has been adopted by the Nixon Administration to deal with this problem is to induce substantial arms sales to the Middle East—a strategy which resulted in sales of more than $4 billion to Iran, Saudi Arabia, and Kuwait alone in 1973-1974...

...Faced with the loss of its Latin American market (and the reduction in political leverage that this entailed), Defense officials and industry representatives, with Nelson Rockefeller an outspoken ally, launched an intensive campaign to abolish government constraints on arms exports to Latin America...

...To continue protecting American interests abroad, therefore, Nixon has compelled client nations to supply troops for U.S.-led counterinsurgency operations (as Thai troops have been used in Laos), and to purchase substantial quantities of U.S...

...While such a policy can, in some instances, contribute to the preservation of peace, it is ultimately destabilizing when motivated by rivalry between the big powers—in this case the Soviet Union and the United States—which are the main suppliers of weapons to the belligerents...

...jets to Pakistan in 1971...

...sales activity in Latin America, Administration officials have campaigned vigorously for nullification of all Congressional restraints...

...military spending abroad, he sought to persuade the allies to make substantial purchases of U.S...

...Nevertheless, the cumulative impact of Administration policies has been to quicken the pace of militarization in underdeveloped areas and to help fuel an upwardly spiraling "balance of terror" in certain key areas that could lead to an unending series of local wars or even a major world war...

...purchases of petroleum from the Middle East, and the rising prices of crude oil, the supply of dollars in Arab hands has been growing at a spectacular rate: Middle East profits from oil sales, according to one expert, will rise from $5 billion in 1970 to $10-$12 billion in 1975, and reach an estimated $30-$50 billion by 1980...

...Despite such pressures Congress has so far refused to retreat on its arms sales policies...

...These hard-sell tactics have not been without success: while foreign sales of most U.S...

...Copyright © 1974 by Michael T. Klare...

...As one solution to the problem, the Department of Defense launched an intensive campaign to expand sales of U.S...

...Recognizing that the Senators were primarily motivated by the desire to prevent costly arms races in the Third World, Meyer emphasized the futility of such restrictions in light of extensive Latin American purchases of European arms: "The long-term consequence of our paternalistic, even patronizing, restrictions will be the acquisition of more expensive items, higher maintenance costs, and greater diversion of financial resources from civilian purposes...

...Equally striking is the disclosure that sales to underdeveloped countries in 1970-1972 were sixty per cent greater than sales to the developed countries...

...Aerospace Production : When Vietnam-related Defense expenditures began to decline in the early 1970s, many U.S...

...And even if a world war does not come, the growing sales of armaments to underdeveloped nations will strengthen the rule of authoritarian military regimes while postponing long-overdue social and economic development projects which offer the only chance for long-term peace in the Third World...

...Even these increases, however, have been inadequate to meet the voracious needs of America's allies, and arms sales have had to be expanded to fill the gap in even the poorest countries, such as South Korea and the Philippines...

...arms sales to the Third World have become a central component of President Nixon's military and economic policies...

...This process perpetually threatens to precipitate armed conflict...

...In an extraordinary demonstration of Pentagon reasoning, Admiral Moorer even had the audacity to suggest that the only way to discourage Latin America from diverting excessive resources to the acquisition of arms was to increase U.S...

...arms sales policies...

...arms dealers have been quick to exploit...

...military material or services, our friends and allies have turned to other sources...

...Total sales for fiscal 1974 are expected to reach an astounding $5.2 billion...

...aerospace firms experienced significant cutbacks in Defense contracting and were forced to order massive layoffs of skilled and semi-skilled personnel...

...manufactured goods have declined in recent years because of stiff competition from Europe and Japan, U.S...

...In an effort to pass on some of these mounting costs to the allies, the Pentagon is seeking substantial sales of advanced U.S...

...Some companies—particularly producers of attack aircraft and military helicopters—predicted that termination of the war would precipitate the closure of entire production lines or even corporate bankruptcy...

...sales drive has been so intense that many European officials—including several foreign ministers—have complained openly of the Americans' "all-out, hard-sell tactics...

...arms sales abroad since World War II...

...According to the Stockholm International Peace Research Institute, four countries—the United States, Great Britain, France, and the Soviet Union—supplied eighty-seven per cent of the major weapons systems acquired by underdeveloped countries between 1950 and 1969...

...Spurred by such pragmatic considerations, the Pentagon has posted substantial increases in export sales for each of the past three years: Total military sales rose from $1.4 billion in 1970 to $2.6 billion in 1971, $3.9 billion in 1972, and an estimated $4.6 billion in 1973...

...Under this strategy, the so-called "Nixon Doctrine," White House spokesmen insist that increased Foreign Military Sales and MAP aid are essential if the Administration's goal of reducing U.S...

...Government, but this requirement is sometimes waived when politically expedient—as, for example, when Iran transferred some U.S...

...When President Kennedy took office in 1961, the goals of the FMS program changed radically...

...When their efforts to obtain American jets were frustrated by U.S...

...Total FMS credit sales for fiscal 1950-1972 amounted to $2.1 billion...

...Foreign Military Sales (FMS) program was originally established in the early Cold War period as an adjunct to the grant system provided by the Military Assistance Program (MAP), and shared the latter's goal of strengthening "Free World" defenses against anticipated Soviet invasions...

...The Pentagon's overseas military missions and military assistance advisory groups (MAAGs)—originally deployed to furnish training in use of U.S...

...None of the key restrictions on sales to Latin America has been lifted, although some liberalization of credit terms and export ceilings is likely...

...These included: FMS Credit Sales: Low interest, long-term loans provided by the Department of Defense for purchase of American weapons...

...These arrangements must be licensed by the Department of State...

...arms sales to foreign countries in the past three years far exceed those of the two previous decades The Pentagon Bleeds the Third World MICHAEL T. KLARE In the early summer of 1973, while the nation's attention was focused on the unraveling Watergate scandal, the Department of Defense announced a series of major decisions on foreign military sales which indicated a radical shift in U.S...

...The cumulative impact of these decisions was to Michael T. Klare, former research director of the North American Congress on Latin America, is pursuing graduate studies in political science at Boston University...

...FMS Cash Sales: Direct, government-to-government sales of U.S...

...arms worth $1.2 billion during the last years of the McNamara era, a substantial increase indeed over the $431 million spent in the preceding fifteen years...

...1950-1972 total: $15 billion...

...Previous Administrations had held that all sales to Third World countries should be carefully screened to prevent needless expenditures on non-developmental programs, and to prevent local arms races from erupting into warfare...

...arms aid, former Defense Secretary Melvin Laird argued in 1970, "is the essential ingredient of our policy if we are to honor our obligations, support our allies, and yet reduce the likelihood of having to commit American ground combat units...

...were sent to the edge of the Israeli-Egyptian battlefield to supervise deliveries of advanced armaments...

...Arms sales are considered particularly important in winning and preserving the loyalty of foreign military elites, which in many Third World countries have a substantial—if not decisive—role in determining national policies...

...Thus, when one side in the local dispute receives an increment in military strength from its patron, the other rivals must immediately obtain additional hardware from their own patron if the power balance is to be maintained...

...Commercial Sales: Direct sales by U.S...

...The more advanced and expensive the weapons traded, the more dependent the buyer becomes on the training, spare parts, ammunition, and credits that are available only from the supplier...

...To compensate for increased U.S...

...During the Kennedy and Johnson Administrations, government policy precluded exports of advanced jet aircraft to South and Central America on the grounds that such sales would divert scarce economic resources from crucial economic and social development programs (which formed the cornerstone of the U.S...

...Two years later, in 1973, the President announced that he would again invoke the national security waiver to permit sales of the F-5E supersonic fighter to Argentina, Brazil, Chile, Colombia, and Venezuela...

...Under pressure from an aroused public and a war-weary Congress, the Administration has been obliged to withdraw American combat troops from Asia and to restrain the rate of Defense spending at home...

...FMS Loan Guaranties : Loans secured from private U.S...

...firms of military equipment to foreign governments...

...This danger became all too real in October 1973, when military personnel of both the United States and the U.S.S.R...

...equipment provided under the Military Assistance Program—were converted into sales agents for U.S...

...Obviously, such a concentration of U.S...

...As the 1960s progressed, however, the market for American military products in the developed nations began to shrink and the Pentagon began to encourage substantial arms purchases by Third World nations that had become dependent upon the United States for economic and military aid...

...According to U.S...

...Third, in the last week of July, Shah Muhammad Raza Pahlavi of Iran was flown to the United States to select first-hand the weapons his government would acquire in a $2.5 billion "buying spree"—the largest arms deal ever negotiated by the Department of Defense...

...Dollar Accumulations: With increased U.S...

...Growing Congressional opposition to direct military grants provided the Pentagon with an added incentive for expanding the sales program...

...This competition among the arms producers has naturally induced a parallel and complementary competitiveness among the arms recipients: when one nation obtains supersonic jets or modern tanks, its neighbors and rivals naturally feel a need to obtain equivalent or superior weapons in order to protect their security...

...The 1968 aid program, he added, "will provide no tanks, artillery, fighter aircraft, or combat ships...

...If we provide the material, our power to persuade is enhanced and our ultimate purpose—peaceful evolution and development—is served...

...weapons...

...these in turn provide the supplier with considerable political leverage...

...as a supplier increases its investment in a local regime and its stake in the survival of the client expands proportionally, there is an increasing danger that local Third World conflicts will precipitate a clash between the great powers...

...military hardware...

...A recent study conducted by the U.S...

...policy toward the underdeveloped "Third World": First, on May 26, the Pentagon confirmed that the United States would sell advanced armaments, including F-4 Phantom fighter-bombers and F-5E supersonic jets, to Kuwait and Saudi Arabia—both of which have provided funds and military support to the Arab forces battling Israel...

...policy calls for the maintenance of military parity between Israel and its Arab neighbors...

...government restrictions and—at the height of the Vietnam war—by the sheer lack of suitable merchandise, many of the richer Latin American governments turned to Western Europe for supplies of the desired equipment...

...Recent Administration statements have stressed more pragmatic concerns: that by forcing Latin America to buy from Europe we are losing an important export market at a time of mounting balance-of-payments deficits, and that by discouraging such exports we surrender to our competitors (including the Soviet Union) the political leverage that normally accompanies military sales...

...Before considering the implications of these ominous statistics, it is important to trace the evolution of U.S...

...To achieve its diverse economic, political, and military objectives, U.S...

...military doctrine stressed counterinsurgency and internal security rather than conventional warfare (thus obviating the need for sophisticated equipment...

...To ensure that America's Third World clients would continue to receive the flow of weapons necessary for their survival in a revolutionary era, McNamara established an elaborate system of loans and credits enabling even the poorest countries to purchase U.S...

...Cost-sharing: As aircraft and other military systems incorporate increasingly advanced technological improvements, the costs of research and development (R&D) and production engineering consume a larger share of total acquisition costs...

...He wrote "War without End: American Planning for the Next Vietnams," published by Knopf...

...unless the President determines such sales are vital to the national security, while Section 33 (Fulbright Amendment) limits all forms of military assistance to Latin America (including arms credits, but exclusive of training) to $100 million with a Presidential waiver of fifty per cent of that amount...

...military equipment abroad...

...Within months of the Punta del Este conference, Peru ordered sixteen Mirage V supersonic fighters from France, and Argentina, Brazil, Colombia, and Venezuela followed with comparable Mirage orders...

...The military rationale for arms sales is complemented by pressing economic and political considerations, principally: Balance of Payments: Ever since October 1971, when America's foreign trade balance showed a net deficit for the first time since 1893, the Nixon Administration has regarded the balance-of-payments problem as a major foreign policy issue...

...Since, in the immediate postwar era, most of America's allies were unable to shoulder the burden of their own and the common defense, the United States gave generously of its own resources to remilitarize Western Europe and the "forward defense countries" on the borders of the Soviet Union...

...Second, on June 5, Secretary of State William P. Rogers announced that President Nixon would exercise his option—under an obscure provision of the Foreign Military Sales Act—to waive Congressional restrictions on the sale of "sophisticated" military hardware to Latin America, and would authorize sales of the F-5E supersonic fighter to Argentina, Brazil, Colombia, Venezuela, and, surprisingly, to Chile (then still ruled by the Marxist government of Salvador Allende...

...Arms Control and Disarmament Agency determined that military spending by underdeveloped nations is growing at a rate of nine per cent per year—twice the rate of such spending in the developed countries, and also twice the rate of economic growth in the Third World...

...Thus the Nixon Administration authorized credit sales of advanced jet aircraft (including the F-5E and A-4 Skyhawk) to Chile in an effort to preserve its ties with the military establishment, even though all other trade with the Allende regime had been banned...

...arms sales to Third World areas is eloquently documented in the latest statistics released by the Department of Defense: During the past three years, the United States sold $4 billion worth of arms to underdeveloped countries—or one and a half times more than the total of all such sales for the preceding twenty years...

...When there is no agreement between the big powers for restraint in weapons sales, each transfer of arms to one country sets off a chain of sales to other countries in the region...

...Administration spokesmen frequently assert that the Pentagon's arms sales campaign is not intended to foster a weapons race in the Third World...

...strategy for achieving political stability in the area), and because U.S...

...Thus FMS sales—which until 1965 amounted to far less than the MAP program—today are eight times greater than MAP aid...

...Persuaded by this final point, Congress grudgingly increased MAP grants from $782 million in fiscal year 1969-1970 to $1.3 billion in 1971-1972...

...Strong nationalist sentiment has arisen over what is seen as United States efforts to infringe on the sovereign rights of a country to determine its own military requirements...

...Among factors which tend to spur weapons spending by Third World nations, the efforts of the United States to enhance its balance-of-payments position and to preserve its political influence have already been mentioned...

...Such arrangements technically require approval by the U.S...

...Defense Secretary Robert S. McNamara, who sought to expand the Pentagon's conventional warfare capabilities, recognized that overseas deployment of U.S...

...military regimes in Asia...

...On May 18, 1971, President Nixon informed Congress that he would exercise his option, under Section 33(c) of the Foreign Military Sales Act, to waive the $100 million ceiling on arms transfers to Latin America on the grounds that increased sales were vital to the national security...

...This process has led to the alarming spread of relatively sophisticated arms to otherwise backward and impoverished nations...

...At first, the Pentagon's export drive was directed at the most advanced and prosperous nations of Western Europe, as well as Japan, Canada, and Australia...

...Encouraged by such Administration concern, Latin American governments—particularly those ruled by military juntas—have made record purchases of our American weapons, raising their U.S...

...Even while its export policies contribute to a growing arms race in the underdeveloped areas, Washington claims to be seeking the preservation of a "balance of power" in certain strategic areas torn by political, religious, and economic strife...

...The U.S...

...weapons to compensate for the declining Military Assistance Program...

...Although by 1969 the White House was prepared to lift all constraints on sales of sophisticated arms to Latin America, it discovered that Congress was not disposed to move so quickly...

...International Defense Business, a private information service, has reported that underdeveloped countries spent at least $5.5 billion on the acquisition of new arms in 1972—or double the amount spent in 1968...

...To overcome these obstacles to increased U.S...

...In 1957, for instance, one small nation—Israel—possessed supersonic jets...

...Licensed Overseas Production: Overseas production of American weapons by foreign firms or governments...

...policymakers have been obliged to scuttle established military sales doctrine which discouraged lavish arms spending by Third World countries...

...Other factors also are at work: Since the United States has long had a virtual monopoly on sales of advanced technology weapons (particularly jet aircraft), many European countries, in an effort to boost their own exports, have worked energetically to promote sales of more conventional weapons (tanks, helicopters, small arms) to Third World countries, and particularly to Latin America and the Near East...

...Increased U.S...

...At present rates of growth, this means that Middle Eastern producers will have accumulated an estimated $1,000 billion by 1990...

...arms manufacturers...

...The emphasis is on vehicles and helicopters for internal mobility [and] communications equipment for better coordination of in-country security efforts...

...aerospace exports are rising and in 1972 were the only commodity to show a positive trade balance...

...The Nixon Administration argues, however, that any such controls are self-defeating since these countries will buy arms anyway—if not from the United States, then from Europe or the U.S.S.R.—and that American interests are best served by selling to anyone who can make the down payments...

...I am not urging in any sense an attempt to have an arms race by the developing countries," Deputy Secretary of State Kenneth Rush told Congress in 1973 while testifying on behalf of liberalized credit sales to Latin America...

...twelve years later, thirty-three countries—including Afghanistan, Ethiopia, the Philippines, Uganda, Yemen, Peru, and Nigeria—owned such aircraft...

...troops (and other war-related activities in Southeast Asia) would contribute to an ever-increasing deficit in balance of payments...

...The biggest long-range problem facing the United States in the Middle East," one Defense official told me, "is finding a way to get the Arabs to spend their dollars without letting them get control of our economy...

...R&D expenditures on the C-5A jumbo transport jet, for instance, amounted to more than $1 billion...