Surely the greatest direct impact of the military-industrial complex on American foreign policy, and the greatest direct impact of American foreign policy on the military-industrial complex, has been in the transfer of arms among nations, programs of military assistance, cooperative production programs, arms sales abroad, and the rise of multinational corporations in arms and related industries.
One of the most serious charges leveled against the military-industrial complex is that it campaigns actively and effectively against arms control and disarmament, and exerts a controlling influence on the shaping of foreign policy. Those who traffic in military procurement have a vested interest in an unstable international environment. According to proponents of this view, the profits and power of the complex would decline catastrophically if real progress were made in limiting strategic nuclear weaponry and conventional weapon systems. For this reason, it is claimed, advocates of huge arms expenditures use all available means of shaping public attitudes and governmental behavior to perpetuate an illusion of great international danger emanating particularly from the communist bloc of nations. Modern "merchants of death" are said to pursue their own interests in complete disregard of humanitarian considerations.
Juan Bosch, former president of the Dominican Republic, writes of what he calls "Pentagonism." No longer do advanced capitalist nations send out their military to conquer and exploit colonies. Foreign warfare or the threat of warfare provides "access to the generous economic resources being mobilized for industrial war production. What is being sought are profits where arms are manufactured, not where they are employed, and these profits are obtained in, and bring money in from, the place where the center of pentagonist power lies." In short, the domestic population is exploited now as colonies were in the past.
But the serious question remains: Do not countries that have no substantial arms industry have a right to obtain arms from outside sources in order to defend themselves? And is it not in the national security interest of the United States to have allies who are well armed and equipped for military action?
The opening rounds of the Cold War took place in the intercontinental crossroads of the Near East. Only there did Russian efforts fail to consolidate a system of "friendly" buffer states along the Soviet borders. Communist guerrillas in Greece had threatened to extend communist influence in the Balkans and to deliver to the Soviets another strategic area for possible domination of the eastern Mediterranean.
What had brought matters to a head so far as American policy was concerned was not a new and sudden communist attack, but the announcement by the British in February 1947 that they no longer would be able to continue the assistance they had been giving to Greece and Turkey. This might have opened the door to communist penetration. Actually, it set the stage for the policy of military aid that came to be known as mutual defense assistance.
Even as the North Atlantic Treaty was being discussed in early 1949, the implication was clear that American matériel assistance to the participating countries would be necessary if the new organization were to have any real effectiveness as a deterrent to aggression. But President Harry Truman waited until the day after he signed the instrument of ratification to follow it up with a formal request for military assistance. Calling for $1.45 billion, this proposal would consolidate in one act the existing programs for Greece and Turkey, Iran, Korea, the Philippines, and the Western Hemisphere, with a new program for North Atlantic Treaty countries. It envisaged three types of assistance: (1) direct transfer of American military equipment; (2) expert guidance in using the equipment and in production of equipment; and (3) dollar aid to increase direct military production in Europe. Ten weeks later Congress approved the program in the Mutual Defense Assistance Act.
In three years of war in Korea, allied forces other than those of the United States and the Republic of Korea never reached as much as 10 percent of the total troop strength. The United States provided half or more of the logistic support for these forces, but this amounted to a relatively insignificant fraction of the total supplies and services furnished by the United States and Korean forces. But the problems of coordination, negotiation, and accounting were as great as if troop contributions had been several times as large.
A truck rebuilding program in Japan grew to a large scale for the Korean War efforts. Civilian automotive experts sent by the Department of the Army began to arrive in Japan in December 1947 to set up the first production lines. The plan was to rebuild motor trucks on a mass production basis. Although Japan was the foremost industrial power of the East, much in American methods of mass production was foreign to many Japanese workers and supervisors. They were not used to the close tolerances and rigid inspections necessary for the complete interchangeability of parts that is the basis for mass production, and many of their work habits and customs seemed quaint when compared with American factory methods. A training program soon overcame most of those obstacles, and completely renovated trucks began to roll off the assembly lines in ever-increasing numbers.
Old trucks brought into the plants first went to the disassembly line, where they were completely broken down to the last nut and bolt. These parts were then sorted, cleaned, and sent to the various shops. Engines, transmissions, carburetors, and other major assemblies were rebuilt in separate plants. Various parts came together on the assembly line after the fashion of Detroit. The new trucks—built of old parts—then went through a tune-up shop, received a new coat of paint, and a thorough final inspection, and then entered the supply system. In 1951 vehicles were coming off some assembly lines at the rate of one every four minutes. Some 30,000 Japanese were working on the project under the supervision of 50 ordnance officers, nearly 300 civilian experts from the Department of the Army, and about 500 enlisted men from the Ordnance Corps. Here, surely, was an indirect boost to the Japanese automobile industry, and perhaps a further thrust toward a "military-industrial complex international."
An aspect of the defense business that was becoming more significant, with a new twist and a different thrust, was the sale of arms and equipment abroad. The provision of military equipment to foreign countries around the world under the mutual defense assistance programs and other programs already has been mentioned, but there was more to it than that. Now there was a studied effort to persuade other governments to buy American military matériel.
As a part of military assistance to other countries, the United States at first emphasized cooperative production programs with certain of those countries. Undoubtedly, the cooperative production programs contributed significantly to European defense. But Europeans saw the whole effort as too much of a one-way street. The United States showed little inclination to accept European designs for cooperative production either in the United States or in other European countries, even when European designs were favored by those countries. According to one view expressed at the time, this situation was the natural result of American technological superiority and Yankee salesmanship. Another suggested that it was due at least in part to pressure by the U.S. government, which had been lobbied by its own defense industries.
Recognizing what was appearing to many to be the growth of an unhealthy situation, Secretary of Defense Robert McNamara suggested a "common market" in armaments within the NATO alliance. This would encourage trade among all the allies on the basis of economy and quality, including better opportunities for European nations to sell to the United States. The impediment to this scheme came not mainly from trade barriers but from government procurement policies. A serious blow to anything approaching the kind of "common market" that McNamara envisaged came in the fall of 1967 with a nationalistic restriction that Congress imposed on the Defense Appropriation Act. In this instance, the members of Congress who offered the restrictive amendment evidently were interested mainly in eliminating foreign competition for shipbuilding industries in their home districts. But the vote in support was so large that it seemed likely that other members might be seeking similar protection for other kinds of goods at a later time.
Another point of some criticism was in U.S. arms sales to developing countries that could ill afford them. In 1972 four nations—the United States (which accounted for one-third of the world's total weapons), the Soviet Union, Britain and France—were responsible for more than 90 percent of all exports of arms to ninety-one developing countries. Total exports of U.S. arms to foreign countries from 1945 to 1972 (whether in grants or in sales) amounted to approximately $60 billion. This was a significant addition to the orders of American defense industries—and a further impetus to expansion and consolidation of the military-industrial complex.
Some critics have suggested that American enthusiasm for the expansion of NATO to include Poland, Hungary, and the Czech Republic was based less on concerns for national security than on the opening of new markets for the American arms industry. William Greider writes in Fortress America (1998) that an official of Lockheed Martin was on the ground in those three countries, and in other potential new member countries, even before the expansion agreements had been accepted. He was there to make a sales pitch for his company's fighter planes, air transports, communication satellites, radar, and other matériel. Not that there was any new threat to the security of those countries, but now they would be moving to replace their old Russian-made armaments with more modern and compatible items from the United States. With pressure sales from British and French concerns as well as American, something of an arms race was under way in Latin America and in Asia.
After dropping sharply from an all-time high of $81.5 billion in 1984 (in 1997 prices) to a low of $42.2 billion in 1994, international trade in arms took a sharp upturn. By 1997 it had risen by 26 percent from that low point, and by 23 percent just over the previous year, to $54.6 billion. Three regions—the Middle East, East Asia, and western Europe—accounted for 80 percent of that trade in 1997, but arms sales to South American countries were rising at a rate of 20 percent a year from 1992 to 1997.
During the 1995–1997 period, Saudi Arabia was the leading arms importer, with a total of $31.3 billion. Others in the top ten arms importers were Taiwan, $12.5 billion; Japan, $6.8 billion; Egypt, $5.3 billion; Kuwait, $5 billion; Turkey, $4.9 billion; United Kingdom, $4.5 billion; South Korea, $4.2 billion; United States, $3.8 billion; United Arab Emirates, $3.8 billion. The United States was the main supplier of arms for eight of those countries (all except the Arab emirates, where France was the chief supplier).
The American share of world arms exports grew from 29 percent in 1987 to 58 percent in 1997. During that period, the Russian share of world arms exports declined from 37 percent to 4 percent; the British increased from 8 percent to 12, and the French from 4 percent to 11. In dollar amounts, world arms exports in 1995– 1997 totaled $142 billion. The total for the United States during that period was $77.8 billion; for the United Kingdom, $18 billion; for France, $12 billion, and for Russia, $9.2 billion. In 1997 arms exports represented 4.6 percent of the total exports of the United States, 2.3 percent of the exports of the United Kingdom, 2 percent of the exports of France, and 2.6 percent of the exports of Russia.
While arms trade totals of North Korea were not high when compared with totals of other nations, it should be noted that in 1988, 32.3 percent of North Korea's total imports were in armaments, and 29.2 percent of its total exports were in armaments. By 1997 those figures had declined to 2.1 percent and 8.1 percent, respectively. The People's Republic of China's arms exports amounted to $1.1 billion in 1997, 0.6 percent of its total exports, and its arms imports were $142.2 million, 0.4 percent of its total.
A further complication on the international scene is the growth of domestic arms industries into international conglomerates and multinational corporations. When a great military aircraft manufacturer leaps national boundaries and takes in companies or builds plants in many countries, where does its loyalty lie? What control does its home country have over it? If a foreign branch builds planes or tanks or guns for a country that has become an adversary, how can the company be accused of trading with the enemy?