Arming the World

(8 of 12)

everything from gunboats to antitank shells, its best-known weapons are the UZI submachine gun and the sophisticated Kfir fighter jet, a modification of France's Mirage 5. More than 10,000 uzis were sold in the U.S. alone last year; they are used by the Secret Service to protect the President, and a modified version is wielded by hunters in Michigan to kill deer. In order to underwrite the cost of producing Kfir jets for its own use, Israel must export up to 25% of them. Because the jet contains a General Electric engine, the U.S. can restrict its export. Carter, as part of his aim of keeping such advanced technology out of Latin America, blocked a proposed sale of 24 Kfirs to Ecuador, which bought French Mirages instead. Reagan lifted the export restrictions, and Ecuador may buy them yet.

With help from their governments, manufacturers compete vigorously to win contracts. Payoffs have been largely controlled since the bribery scandals involving Northrop and Lockheed in the mid-1970s, but large commissions still abound. One of Saudi Arabia's sales agents, Adnan Khashoggi, has become a multimillionaire, jetting between capitals to consummate major deals. Khashoggi has sued Lockheed for $300 million in commissions that he claims is still owed him for arranging the sale of TriStar jets and Hercules transports to Saudi Arabia. Earlier this year, he won a $20 million judgment on disputed commissions from Northrop.

The annual Paris Air Show in June this year, which was followed immediately by a display of tanks and military hardware at nearby Satory, provided an international showcase of major weapons for sale. Potential buyers could inspect a prototype of the Mirage 4000, view Northrop's export model 5F-5G fighter under a massive tent, and watch an Israeli display of a remote-piloted unmanned reconnaissance plane. The Soviets never show off their fighters, but this year brought their new, giant Mi-26 helicopter, the world's largest, which can lift 65,000 pounds.

Weapons today are hawked like any other product. The French and British produce imposing catalogues, while U.S. manufacturers tout their products in Aviation Week & Space Technology and Armed Forces Journal. Says a McDonnell-Douglas ad for the F-15:

"Strong enough to win, awesome enough to deter. By its very presence it is an expression of national will." A Grumman ad for Phoenix air-to-air missiles boasts of "an unprecedented 84% kill rate" under the catchy headlines: "The F-14/Phoenix team. Because you have to get the enemy before he gets you."

Sales frequently involve quid pro quos, such as allowing the purchasing country to manufacture some of a weapon's parts or to assemble it with local labor. In order to capture a $400 million contract with Switzerland for F-5 fighters, Northrop agreed to market $135 million worth of Swiss goods throughout the world. The American aeronautics company proceeded to sell Swiss power-generating equipment and shelving material to Saudi Arabia, drilling machines to Spain, water filtration systems to Morocco and transport boats to Bolivia. Northrop easily exceeded its quota. The reward: another contract for 38 additional jets, and the responsibility for selling $150 million more of Swiss goods. Says one Northrop agent: "Trying to sell planes has given us as much depth in the Swiss economy as the Swiss