Dr. William Keller, Executive Director,

MIT Center for International Studies

September 16, 1998

The history of the arms trade in Iran and Iraq provides a compelling introduction to some of the central issues of conventional proliferation today. Both countries are technologically backward, yet both managed to procure large arsenals of relatively modern weapons and military equipment from the rest of the world. The oil-revenues possessed by these states made trading arms with them almost irresistible, especially to smaller countries. The arms trade with Iran and Iraq was also exacerbated by the U.S.-Soviet Cold War confrontation. Over $80 billion in military imports flowed into the region from 1981-1988. However, US policy in the region ultimately backfired. The infusion of arms into the region set off a series of reactions that ultimately led to the Gulf War and forced a massive U.S. intervention. One of the most powerful lessons of the experience with Iran and Iraq is that our friends aren’t always our friends and weapons last for a long time. The United States, however, seems not to have learned this lesson. Since the end of the Cold War, U.S. foreign military sales agreements have increased dramatically from $34.5 billion between 1986-1989, to more than $83 billion from 1991-1994.

A closer look at the nuts and bolts of the modern arms trade reveals several important trends and distinctions. First, it is important to note that for almost every argument that can be made about the arms trade, there is a counter-argument. For example, many analysts have noted that the arms trade appears to have diminished worldwide since the end of the Cold War, but this appearance may be due to a change in the way the U.S. government measures the flow of arms. Second, the arms trade is driven by a mix of economic, political and military calculations, usually in that order of importance. As the example of Iran and Iraq illustrates, however, these calculations can go very wrong. Third, foreign sales have become more important to defense manufactures since the end of the Cold War. Sales to foreign countries are now more profitable and make up a larger percentage of total revenues. During the Cold War, small countries needed foreign sales to achieve scale economies in arms production. Today, even U.S. companies increasingly rely on foreign sales to make smaller production runs profitable. Fourth, the modern arms market is a buyers market and will remain that way for the indefinite future. Buyers, therefore, have a growing ability to induce suppliers to sell more weapons and more advanced technologies. Fifth, the arms trade is only partly about buying weapons; increasingly, it is about international technology development and foreign direct investment. A global arms industry, made up of multinational corporations producing weapons jointly, is taking shape. These companies are harder to control and less interested in the security concerns of the United States or other countries than have been single-country defense manufacturers. Finally, the arms trade increasingly integrates military and civilian industries and technology, rendering the control of proliferation even more difficult.

Much of the recent debate on the arms trade has focused on the distinction between conventional and unconventional weapons, or so-called "weapons of mass destruction." In many ways, however, this is a false dichotomy. Although nuclear (and potentially biological) weapons may constitute a class of one, the category of weapons of mass destruction is based more on historical experiences and precedent than on logical grounds. "Conventional weapons" can have many of the characteristics normally associated with weapons of mass destruction depending how they are employed, battlefield conditions and the effects they achieve. Many analysts and policy makers, for example, focus on the threat posed by the proliferation of ballistic missile technologies. Yet aircraft are at least as efficient as missiles for delivering weapons of mass destruction and nearly every country suspected of developing weapons of mass destruction also possesses significant air forces.

Conversely, the threat posed by weapons of mass destruction may be overstated. The nerve agent released in the Tokyo subway, for example, probably killed fewer people and resulted in less destruction than a relatively small high explosive device might have accomplished. In fact, there are no cases of mass destruction in the last 50 years caused by "weapons of mass destruction." Conventional weapons, on the other hand, killed 24-5 million people, and have been used during this period to create mass destruction. These observations are important because the scale, sophistication and destructive capability of "conventional" weapons now entering the arms trade is increasing. If the distinction between conventional and unconventional weapons is not clear, then the resulting concepts of proliferation and the strategies for dealing with it may also be deficient.

Combating proliferation in the modern world is difficult and becoming harder every day. Perhaps the greatest paradox of proliferation is that the industries and technologies that support economic development -- aerospace, nuclear power, chemicals, pharmaceuticals, and biotechnology -- are the same industries and technologies that can be used to produce modern weapons and weapons of mass destruction. Since the Wassenaar Arrangement is too weak to affect control of weapons and military technology, the best policy option now is to concentrate on banning so-called "weapons of ill repute," such as blinding lasers, anti-personnel mines, and a variety of fragmentation and incendiary devices.

Rapporteur: Ben Valentino

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