30. Paper Prepared in the National Security Council1
MIDDLE EAST/PERSIAN GULF ARMS SUPPLY
Early in 1977 the Administration will be faced with decisions on a number of arms sales proposals involving countries of the Middle East and Persian Gulf. The major pending requests (i.e., formally submitted but not approved) and those expected in the next few months are summarized at Tab A. The pending requests by Iran and Israel are the most significant militarily due to the quantities and the high level of sophistication, but their political significance could be matched by anticipated requests from Saudi Arabia and Egypt.
Decisions taken will have much greater impact than would ordinarily be the case since they will be interpreted by the countries of the two areas, by our allies, by the USSR and by the Congress as revealing the long-term attitudes and policies of the new Administration on issues which have become extraordinarily sensitive during the past year. Thus, the response of the Carter Administration to these requests will have a considerable impact on our bilateral relations in the area and on the perceptions of future US policy toward the Middle East and Persian Gulf areas, which in turn will impact upon the future prospects for peace and stability in the two areas. Specifically, the response will:
—Influence, to a substantial degree, the future course of the area-wide arms buildup;
—Affect the climate for negotiations toward a permanent Arab-Israeli settlement.
—Influence U.S. relationships with the requesting states.
Moreover, decisions on these sales will serve to establish the relationship between the new Administration and the Congress in the important field of arms transfer, security assistance and arms control questions. They will also have an appreciable effect on the prospects for controlling the transfer abroad of advanced US military technol[Page 164]ogy, with its implications for US security and control of technological dissemination.
Since 1974, sales of US military equipment and services to other nations (FMS and commercial) has averaged approximately $10 billion per year. Although the dollar value of sales to most areas of the world has remained roughly equivalent (in constant dollars) with the levels of grant military assistance provided by the United States in the 1960s, the striking exception to this rule is the Middle East and Persian Gulf. Since October 1973, more than $19 billion of US defense articles and services have been sold to the nations of these areas. More than 40 percent of these sales have been to Iran, 34 percent to Saudi Arabia, and 22 percent to Israel, with relatively small proportions to other nations such as Kuwait and Jordan.
For better or worse, the willingness of the United States to supply arms has come to be perceived by the governments of the Middle East and Persian Gulf as an indication of both the extent of US bilateral support and the direction of overall US policy in the region. Arab countries see such sales as evidence of the balance being struck in our approach to the Arab-Israeli dispute, and watch with extreme care sales to Israel, just as Israel carefully monitors the level of US arms sales to the Arabs. Both sides in the Arab-Israeli conflict see the supply of arms as of major political as well as military significance. President Sadat feels very strongly on this point and has recently reiterated to visiting Congressmen and Senators his strong feelings that the time has come when his policy shift away from the USSR and toward the US, to the severe detriment of Egypt’s armed forces, should qualify Egypt for the purchase of sophisticated weaponry (e.g. F–5 aircraft and TOW missiles) from the U.S. At the same time, the Arab Ambassadors in Washington have been collectively presented the strong concern of their governments over the impact on the peace process of the recent sale of four items of military equipment to Israel and Israel’s recent additional military requests. Iran and Israel exchange military information and each observes closely what the other obtains from the U.S. Saudi Arabia observes closely what Iran obtains from the U.S. and also compares U.S. support for Israel with U.S. willingness to help meet their own more modest defense goals.
Thus, decisions by the United States on military supply requests have taken on a significance to important Middle Eastern and Persian Gulf countries much greater than the individual military items or items in question. Several countries, most notably Iran and Egypt, are clearly prepared to turn to a closer military supply relationship with the USSR as well as Western Europe if too disappointed by the US response to their requests, particularly if others appear to be more favorably treated. The Saudi reaction to severe disappointment could impact on oil prices [Page 165]as well as result in a considerable shift away from US and toward European sources for both military and civilian goods and services, but in all probability not a shift to Soviet-supplied arms.
The importance attached to US security assistance programs by our friends and allies in the Middle East and Persian Gulf where we have substantial national interests thus underscores the necessity of following a carefully reasoned arms transfer policy. The advent of a new Administration provides a unique opportunity to review the fundamental direction of US policy in this field without upsetting the present political relationships which are quite favorable to US interests.
There are three basic approaches which the new Administration can adopt in dealing with these pending or anticipated requests for arms sales: a) continue the present policy of general responsiveness on an ad hoc basis to all friendly countries, attempting to meet as much of their request as can be justified without upsetting the general politico-military balance in the area or placing undue demands upon the US military establishment; b) decide to adopt a selective policy freezing the supply of certain categories of weapons to all countries in the area and/or applying special restrictions to certain but not all countries; c) deciding upon a temporary pause of several months in approving major new requests from any country in the Middle East and the Persian Gulf while a broad review of arms supply policy is conducted.
The first approach, continuing the present policy of ad hoc responsiveness on a case-by-case basis to all friendly countries in the Middle East and Persian Gulf, could be seen as inconsistent with President Carter’s stated position on arms exports and would tend to perpetuate the difficulties between the Executive Branch and the Congress on this issue. While providing maximum flexibility for the continuation of a policy of close bilateral relations, the absence of consistent, coherent policy criteria, creates serious problems in deciding upon requests which could have a negative effect upon US regional interests as well as upon arms limitation objectives.
The second approach of freezing selected categories of equipment to selected nations would create serious problems of determining which systems and which nations would receive favorable treatment. It would limit our policy flexibility and could lead to a strongly negative reaction from nations which considered themselves the victims of unjustified discriminatory treatment. This reaction would probably be most intense from those key states (e.g. Iran and Israel) which have the most important security relationships with the United States. Such a procedure would pose stark choices between US interests in sustaining certain political relationships and arms control desiderata, risking an outcome which is satisfactory to neither. For example, a freeze applied only to the Persian Gulf might be appealing to Congress and would avoid the [Page 166]problem of applying limitations to the supply of arms to Israel, but it would be far more upsetting to Iran and particularly Saudi Arabia than if it were applied to both the Persian Gulf and the Middle East. Moreover, this approach would not deal with the tough problem posed by Sadat’s intention to request sophisticated weapons, in part to test the good faith of the new Administration toward Egypt and its basic attitude toward an Arab-Israeli settlement. The large Middle East part in the world arms buildup would continue virtually unchecked.
On balance, we have concluded that the relative disadvantages argue against the first two approaches and in favor of the third approach as outlined below.
That President Carter announce, immediately after January 20, that no new requests for major arms sales to the Middle East and the Persian Gulf will be approved and submitted to Congress for an indeterminate period of time lasting at least several months.
This temporary pause in new arms sales would continue until the Administration has completed a thorough review of the arms requests now before it and its overall arms policy in the region, taking into consideration the prevailing military and political situation, the prospects for regional peace and stability, and the possibility of reaching agreement among both potential suppliers and recipients on effective means of limiting the increased flow of arms to this sensitive area of the world. (A draft announcement is at Tab B.)
We believe the political impact of such an initiative would be substantial, while the actual effect on military capabilities of individual countries and on the military balance in the two regions would be slight. A pause would not affect delivery of items already approved (including the four items recently approved for Israel) nor the sale and delivery of spare parts, ammunition, construction, training, and non-lethal equipment. Programs affected would be those where delivery is at least a year and usually several years in the future. In addition, the US could assure affected countries that we would do our best to ensure that delays in accepting their orders would not affect delivery schedules for those items ultimately approved and that we would resume deliveries if a crisis were to arise. Furthermore, by applying the pause to all Arab countries in the Middle East plus Egypt as well as Iran and Israel, the US would have demonstrated its seriousness of intention and even-handedness of approach to both arms control and peace negotiations. Finally, the Administration would be able to avoid, during an unusually sensitive period, specific arms supply decisions which would be highly controversial with certain countries of the Middle East and the Persian Gulf as well as with Congress.[Page 167]
The objective political and military circumstances in both the Middle East and the Persian Gulf are favorable for a pause in new arms transactions during the first part of 1977. This judgment would not necessarily be accepted by all of the Governments of the area, nor would it fully satisfy those who are intent upon a rapid military buildup. However, it is the US assessment and can be supported by detailed, comprehensive analysis.
In the Middle East, Arab and Israeli attention is focused on prospects for peace rather than planning for another round of hostilities. Therefore, a pause in approving new deliveries would tend to reinforce rather than run counter to the prevailing mood; there is also no sign on the horizon of a sharp increase in tensions in the Persian Gulf which would justify new arms transactions. In both the Middle East and the Persian Gulf, there is no notable military imbalance nor any individual country (other than Egypt) which has a clear need for a further long-term military buildup or for any specific arms system. With the exception of Egypt, there are in the pipeline for delivery between now and 1980 considerable amounts of weapons already approved by the US.
This is particularly true of Israel and Iran, the two countries with the most ambitious plans for future acquisitions from the United States. Israel is estimated (see NIE 35/36–I–76) to be capable of retaining its strong military superiority over potential Arab enemies through 1981 with only those weapons already on hand or presently under delivery plus spare parts, ammunition, etc. Iran probably has as many arms on hand or under delivery as it is capable of absorbing without great strain and is facing no serious immediate threat. Completion of Saudi Arabia’s long-term military program (worked out with USG advice and emphasizing construction and training more than weapons acquisition) will not be seriously impeded by a pause in the approval of major weapons transactions during at least the first part of 1977, nor will the Jordanian program. Egypt needs additional weapons both for military balance and political purposes—but there is only a slim likelihood of obtaining Congressional approval in 1977 for most of the items and quantities that it would like to acquire from the US.
Is a pause a good idea at this time?
—It would obviate the need to make early Executive Branch decisions and stimulate Congressional debate on arms requests from Israel and the Arab states (particularly Egypt) which could prejudice the ability of the United States to retain the trust of both sides during a period of intensive effort to make further progress toward a Middle East peace settlement. [If Israel’s requests were approved while Arab requests were not, it would probably have a negative impact on US ability to induce either Israel or the Arabs to move toward a settlement.][Page 168]
—We would have served notice that the United States is no longer willing to approve virtually unlimited military sales to the Middle East without some progress toward a settlement, and (by keeping the term of the pause indefinite) we would provide additional impetus for the movement toward that goal.
—There is a unique but temporary opportunity as the Administration changes: a pause can be justified as necessary study/review time with less of a negative impact on bilateral relations; to do it later will necessarily be interpreted as signal of major change of policy.
—We would provide essential breathing spell for policy review and formulation without insistent day-to-day pressures for action on specific requests; would provide clean slate for conscious, long-term policy direction and a chance to impose a distinctive stamp on the choice of objectives, keeping what is good without muddling through with bits and pieces of inherited institutional assumptions and methods. Otherwise, the new Administration will soon be caught up in ad hoc actions which will define policy direction by establishing precedents.
—It would come at a time when a wealth of experience and background data is available within the Executive Branch for meaningful analysis, with considerable leg work already done; the bureaucracy is in a receptive mood for a thorough reappraisal, and there should be no major obstacles to conducting a useful and realistic policy study.
—It would be consistent with President-elect Carter’s stated position and will be a distinct plus with Congress and the public, who are eager for action in the control of arms supply to foreign countries.
—It will reduce pressures to raise Israel’s FMS level from $1.0 billion to $1.5 billion for FY 78 (with the implication that the level would remain at $1.5 in subsequent years rather than $1.0).
—It is bound to generate unduly high expectations among those who oppose arms sales, which would be difficult to fulfill since the conclusions of policy review may not support drastic restrictions.
—It will do some damage to our bilateral relations with countries such as Iran, Jordan and Saudi Arabia who have pending requests awaiting approval, and to Egypt which is expected to make requests shortly after January 20. There could be a tendency on the part of these countries to turn to other arms suppliers, either the USSR or Western Europe. The Arab reaction would be mitigated were the pause in new approvals clearly extended to Israel; the Iranian reaction would be more difficult to mitigate and could lead to more military procurement from the USSR, and possibly to a less sympathetic attitude toward US military facilities in Iran.
—Of the confrontation states, the pause would apply primarily to Israel and to a lesser degree to Jordan. We could be accused of punishing Israel unfairly while the Syrians, for example, continued to receive arms from the Soviets. Recent publicity about the possible sale of French Mirage fighters to Egypt will reinforce this reaction; if the sale goes through. Israel and its supporters will also charge that the US is not standing by its previous arms commitments (to sell the F–16, for example) and by campaign promises not to apply pressure on Israel, alleging that all affected states, except Israel, have alternative sources of supply [Page 169]and that the pause is a disguised effort to force Israel to make undesirable negotiating concessions.
—Once such a pause is declared, a decision on how and when to resume deliveries becomes a major political act. It will be difficult to decide upon a time and criteria for resumed sales that will not have drawbacks from the standpoint of our relations with one or more countries and possibly also from the standpoint of our peacemaking efforts.
Prior to any public announcement, the Administration should consult with the nations most directly affected by the new policy and with the Congress. A basic approach is outlined below.
The Israeli leadership should be notified shortly before the planned announcement, making the following points:
—A major policy review of arms transfers to the Middle East and Persian Gulf is required, and no new decisions on arms transfers to these areas can be made until it is completed. We expect it to require several months and certainly less than a year.
—If a pause were declared only for the Arab states and Iran and not Israel, we would be accused of partiality and the possibility of progress toward a negotiated settlement could be severely compromised. As it is, the pause can contribute to the peace process.
—Israel is very well prepared to defend itself against any short-term threat from the Arabs and its military security should not be impaired by a pause in new orders.
—Previous commitments (including the four items) will not be affected by the moratorium, and the flow of spare parts and ammunition will continue. Israel will not be penalized by delayed delivery times due to the pause.
—The pause will only be temporary, and it would be terminated at any time if there is a major shift in the military balance or some new threat to Israel’s security.
—The US will make efforts to have the USSR and Western Europeans exercise restraint on deliveries to Arab states.
—A major policy review of arms transfers to the Middle East and Persian Gulf is required, and no new decisions on arms transfers to these areas can be made until it is completed. We expect this to require several months and certainly less than a year.
—We believe that a temporary pause would be in the best interests of our long-term relationship. In view of the growing criticism in the United States on this issue, Iran’s long-term interest in security cooperation with the United States can best be protected by the development and articulation of a policy which has greater public support and understanding.
—The very large backlog of undelivered military equipment on previous orders will not be affected by the moratorium, and the flow of spare parts and ammunition will continue.[Page 170]
—The pause will only be temporary, and it would be terminated if a major shift in the military balance should occur or if some new threat to Iran’s security or regional stability should so require.
—A major policy review of arms transfers to the Middle East and Persian Gulf is required, and no new decisions on arms transfers to these areas can be made until it is completed. We expect this to require several months and certainly less than a year.
—We believe that a pause would be particularly appropriate at this time when the prospects of movement toward peace are especially promising. The moratorium will be applied equally to Israel and to Iran as well as the Arab states.
—The very large backlog of orders on military construction and hardware, as well as the on-going training, support and construction programs, will not be affected by the moratorium, and the flow of spare parts and ammunition will continue.
—The pause will only be temporary, and it would be terminated if a major threat to the security of Saudi Arabia should develop.
Prior to public announcement, the President-elect and Secretary of State-elect should consult with at least the following key Congressmen: Senator Sparkman (Chairman, SFRC); Senator Case (ranking Republican on SFRC); Senator Humphrey (Chairman, SFRC Subcommittee on arms sales); Representative Zablocki (Chairman to be, HIRC); Representative Broomfield (Ranking Republican, HIRC); Representative Fascell (key member of HIRC on arms sales issues). In addition, they may wish to consult: Senator Javits, Representative Rosenthal, Representative Bingham, Senator McGovern and Representative Hamilton. For maximum impact on Congress, consider making initial announcement at first bipartisan Congressional leadership meeting at the White House after the Inauguration. Points to be made in these consultations are essentially those in the public announcement and the advantages section of this paper, supplemented for particular Members by the points suggested for use with Israel.
In addition, it would be well to consult privately with the British, French and Soviets before any pause is announced, asking them to follow our example in restraining new arms sales during the first months of FY 1977 and to join us in efforts to work with the countries of the area to agree upon a long-term collective approach to arms limitation. In the case of Britain and France, this would be in keeping with the Carter Administration commitment to prior consultation with allies, it would bring considerable political pressure to bear on them to restrain their activity, and it would be further evidence of the serious[Page 171]ness of our purpose. [There is pending a French-Egyptian agreement involving the early sale to Egypt of 50 Mirage F–1 fighters and the later co-production of an additional 200 F–1s—a striking parallel to the Israeli proposal to the US for early sale of 50 F–16 fighters and later co-production of 200 F–16s. It is possible that a U.S. initiative involving at least a temporary freeze on the F–16s for Israel could induce the French to delay for a corresponding period the F–1s for Egypt, thereby slowing down the Middle East arms race.]
In the Soviet case, advance consultation could be used to try and persuade the Soviets that a corresponding informal unilateral pause (not a government to government agreement) in new Middle East/Persian Gulf arms transactions would be fully consistent with their interests and their publicly stated concern over the arms buildup in these two areas.
Draft Announcement by the President
Over the past several years, sales of United States military equipment and services to other nations has averaged nearly $10 billion per year. A considerable proportion of these sales has gone to the Middle East. Last year alone, the nations of the Middle East and the Persian Gulf ordered a total of more than $5 billion of military goods and services from this country through commercial channels and by government-to-government agreements under the Foreign Military Sales Act. The present undelivered balance of defense contracts with these nations totals more than $22 billion, and the delivery of these orders will extend over many years to come.
I know that this situation has been a matter of concern to the Congress and the US people, and I believe this would be an appropriate time to pause for a period of consolidation and reflection. Specifically, I wish to review the military supply situation for these regions in the context of the peace and stability and security which we and our friends in the Middle East and Persian Gulf are committed to achieving. I want to ensure that the American contributions of matériel, technical assistance training and other military-related services serve the goals of peace and that our decisions on these issues are compatible with the broader foreign policy objectives of this Administration.
To this end, I have directed the State Department to head an interagency task force to examine the political, strategic and security aspects of arms transfers to the Middle East and Persian Gulf including the possibility of an eventual international agreement on this subject. While this study is underway, no requests for major weapons will be approved and forwarded to Congress. This will not affect firm agreements already concluded, or deliveries of spare parts, training and other services, nor will it affect in any way the close associations which have developed [Page 172]between the nations of the Middle East and Persian Gulf and the United States. I am satisfied that the present prospects in both regions are for movement toward peace rather than conflict and a temporary pause in new arms sales agreements can only make the environment more favorable for peace. I am also satisfied that the security of those nations with whom we have long had a close relationship in the security field will not be threatened by this pause. Should a new threat to any of our friends arise, we would naturally be prepared to help them by approving new requests.
The temporary pause is intended to give myself and my Administration the opportunity to examine this very complex area of our foreign policy and, in close consultation with the Congress, to establish a coherent and carefully formulated set of guidelines to serve as the basis for future decisions. I consider this particularly important at the present time.
Summary: The NSC Staff prepared for the Carter administration a set of proposals supporting the idea of a “pause” in arms sales to Middle Eastern countries.
Source: Ford Library, National Security Adviser, NSC Staff for Middle East and South Asian Affairs, Convenience Files, 1974–77, Subject File, Box 38, Persian Gulf (2). Secret. Brackets are in the original. Attached but not published are two informal notes, dated January 11 and January 19, from “Bob,” (presumably Robert Oakley) to other members of the NSC Staff, presenting this final draft to the Carter transition team.↩