I

I!1i PEPSIAN 'ULF

Subritted by Michael Gttsegen

1AJ)
In light of our Vietnam experience there has been a care-
ful weighinp and scrutinizin7 of our foreign commitments.

The product of this reassessment has been a peneral scal-

ing down of foreim cor.itments and a reluctance to enter
into new ones.

However, tee is cne way we are slipping into new military

involvements around the world. This is through the sale of

arms to virtually any non-ccrimunist country that can pay for
them. From 921 million in fiscal 1970, our arms sales rose
to 3.8 billion for fiscal 1973, to 8.2 hillicn fcr fiscal
1974 and 9.3 billion for fiscal /75. Thourh the firures are
not yet in for fiscal 1976 the projected sales figure is even
higher. This ten fold jump now involves 71 countres; all
told the United States is responsible for about ha.f of the
zcrld'.iide arms trade .hich is now approachinr O biliicn.

The implications of these arms sales are great, but Vpe

dramatic increase has occured so far wit - cut a review and
analysis of our interests, objectives or policies. The most
obvious example of this can be seen in the Persian gulf,

Indeed, when one looks at the arms sales problem, it turns

out to be largely a Persian u1f problem. United States arms
sales to a handful of Persian Gulf states accounted for
 '1--

4•L billion of our sales in fiscal '74 and $4.3 billion in

fixca]. 1975, 54% and 46% of our total arms sales respectively.

We are not alone in our sales of arms to the Gulf region.

In 1974 the Soviets sold about $360 million wort of arms
to Iraq. Other significant sales of military hardware t
the non communist ru1f states were France 1 billion, Britain
500 million and West Germany approximately 120 million.

When viewed from two perspectives; the relations of the Gulf

states to each other in the .past and the political lineups
of these countries today, it is easy to un'erstand what this
rapid rise in military expenditures will do to the infrastruc-
ture of the local states. The trend of spending can be seen
in the table below:

!ITLITARY 3IJTGETS OF PEPSIAN GULF STATES (in million$)

IRAN IPAC) SAUDI KUWAIT BAHRAIN
ARABIA
1970 961 477 213 88 3.5
1971 1351 509 236 103 3.7
1972 1847 509 674 108 3.7
1973 2452 558 988 132 4.5
1974 5694 1024 1515 389 7.0

To understand the trends and to predict the future one must

look into the history of the area. The historical perspect-
ive rives new insights into how we should deal with the pre-
 2

sent. Accoding1y we now turn to the history of the (u1f

focusing on the rraor powers, Iran, Iraq and Saudi Arabia.

For 150 years the British were responsible for lre.intaining

order in the Gulf. This responsibility, an outgrowth of the
India policy, began in 1820 when the British government of
India compelled the Sheik of the Arab coast east of Qatar to
sign a treaty. The treaty designed to eliminate piracy and
the slave trade did not outlaw war so the practices continued
under the name of tribal warfare at sea, especal1y in pearl-
fishing season. The tribes continued to war so in 1879 the
British India stationed a naval squadron at the Gulfs mouth,
on the island of Qishm, to supress piracy and enforce the
truce.

Between 1880 and 1916 the government of India concluded with

each shiek a "special treaty" under which the ruler surrendered
external sovereignty to the United Kingdom and accepted a non-
alienation bond pledging not to "cede, sell, mortgage or other-

wise give for occupation" any part of his bond except to the
British government.

Between 1913 and 1922 the bonds were reinforced by explicit

undertakings not to issue oil concessions without prior
British endorsement. Starting in 1820 the British had an
officer in the Persian Gulf to oversee British interests.
Until 19 147 when India was artitoned this officer was employ-
ed by the India office. but in 19147 the lurisdiction over,
and recruitment of these officers, was handled by the Foreign
Office.

Britains responsibility of external sovereignty in 1880 was

designed, not to rake area an exclusive British trading zone,
but to prevent encroachment of India by European powers. This
was reaffirmed and clarified in statement by Lord Lansdowne,
the Secretary of State for Foreign Affairs who said in ay
1930 that though the United Kingdom would "regard the establish-
ment of a naval base, or of a fortified pert, in the Persian
u1f by any other power as a grave nnace to 3ritish interests',
an act which would be resisted "with all means at our disposal."
Though the British did finally allow American c1l concessions,
M exclusiveness was complete unt:.1 1949, and even then
the British refused to allow the United States to erect
naval installation, or to maintain naval vessels in the u1f,

The British system of special treaty relations with the

emirates and shiekdoms enforced political stability: at the
domestic level by setting up dynastic lines; at the regional
level by inhibiting tribal warfare; and at the international
level, by discouraging foreign involvement in the area. The
British enforced a pax Britannica over the Persian (ulf. As
 /
a result of this British protection which not only
kept the countries protected, hut, also kept all innovation
out, the culture remained unchanged fora century and a half.
The discovery of oil made it possible for the mini-dependencies -
Bahrairi, Kuwait, Qatar and Abu Dhabi - to launch self sustain-
ing development programs.

In January, 1968, 3ritains Labor rovernment announced its

intention to withdraw from the Persian gulf within ' years.
A month earlier Britain had pulled out of Aden, leaving a politi
cal shambles. As an afterthought, Britain tried to form the
Federation of South Arabia when it decided to abandon Aden
and the 20 tribalities that made up the Protectorate of Aden.
During the Iranian oil crisis of the 1950's the port of Aden
had grown into a modern city, the hinterlands were largely
unaffected. The city of Aden however had attracted many
Yemenite immigrants. Many of these immigrants were leftist
Arab radicals who, after British retirement, siezed power
in both the city and hinterlands, destr-yed the Federation
before it could take hold, and renamed it the Peoples
Republic of South Yemen.

Subsequently the 3ritish effort to combine rich and poor

tribalities into a viable federation seemed impossib1.
The refusal of Bahra and Qatar to join the federation
appeared to be a death blow to the federation plan. On
 /7

December 2 9 1971, however, the British announced the formation

of the United Arab Emirates. The U,A.E. consists of, in order of
size,.Abu Dhabi, Dubai, Sharjah, Ajan, UmmOal Oaiwain, Ras al
Khaimah and al Fujarirah.

Bahrain, after losing out in a struggle with Abu Dhabi over

leadership of fort Tic omining U.A.E., declared its independance on
August 15, 1971. Qatar followed three weeks 1 1 er in declar-
6-

ing its independence. The two were admitted to both the Arab
League and the United Nations.

Replacing the protectorate treaties with the crown were 10

year friendship treaties. The only clause providing for

military cooperation was one surgesting consultation if needed.

Britain was trying to avoid treaties like the one with Kuwait-
in 1961 which stulated that "Nothing ..... shall. affect the
readiness of Her !'ajestys government to assist the government
of Kuwait if the latter request such assistance". Within
a week of independence the Iraqi laid claim to Kuwait
which they said had been stolen by 3ritis imperialisr.. To
forestall Iraqi action the British sent 600 marines to Kuwait
from England. The conflict was finally rsolved peacefully
and the British pulled out. The stipulation of the 1961
treaty which provided for military support to Kuwait was
In the British election carnpain of 1970 the Conservative
party pledged it wouldn't be bound by Labor's Persian (ulf
policy. In office, however, the Conservatives found the new
policy had gone too 'far, so the 8,500 men in the. British
Forces ulf Command were evacuated on schedule. To insure
against a replay of the Aden debacle British officers stayed
on directing the ministates armies, at the outset .200 officers
were serving with the U.A.E. force of 1200 men.

Despite close relations with the United Xingdon. Oman was

not part of her protectorate system.. The Sultan negotiated a

non-alienation treaty in 1891. The British Omani relationship

was not modified in 1971. British officers, NCO's and pilots
were still loaned or contracted to Omani Field Force under an
agreement of July 1958 which also assured the R.A.F. access te
staging posts at Sulalah in Phofor province and on thd island
of Masirah, off the Omani coast.

British supremacy in the rulf stabilized the situation

through W.W.II. Britain although maintaining close relations,
lost her primacy in Saudi Arabia to the United States after
19 145, The nationalization of oil in 1951 ended the British role
in Iran and brought in the U.S. The Iraqi Corp 7 years later
ended British dominance in Irac, and brought in the Soviets.
Though the British s'istem speared to be intact throughout the
60 1 s, after 1958, the British system had really been reduced
to the string of ministates cn Arabian coast.

Nost expectations weie that after the British left, the Culf
system would collapse. Four veers later though it is still
functioning. The new stabilizin7 forces are OPEC, its
component OAPEC, the Arab League, The U.T. and to a great ex-
tent the arms sales provides stability through tho fact that
none of the states involved is willing to risk toppling over
the apple cart which is working just fine. The Arab Learue
mediates all disputes between Arab members and the United at.on

acts as a regional stabilizer and gives the area intemn=tion&

support. Nevertheless, the fear of radicalization pervades the

monarchial and quasi-monachial states of the gulf.

During the 50's and 60's Egyptian teachers in the emirates and
tribalities carried the message of Arab unity through social
revolution behind the banner of Nasser. The Egyptianhowever
with the advent of Sadats conservative policies, have cooled it,
The Palestinian Arabs, a threat to the conservative regimes
until the Egyptian - Israeli ceasefire of August 1970 and the
defeat of the guerrillas.: by Jordn have once again begun to
surface. Now however in light of the October War they seem
to have gone the terrorism route so that their practical effect
is minimal.
Elsewhere the inducerent for radica1izaton appears less stronr,
Despite the inevitable discontent produced in some quarters, by
lack of political freedom under renressive monarchs and by
corruption and bureaucratic inefficiency in government, the
general trend is not radical. This is so because both the
governments and the people have a better'standard of living
today than ever before. With so much money bulging from the
pockets of Kings, Shahs, Emirs and Sheiks, much spills out
for the people.

During most of the British period little was done in the way of
setting up borders. The first peninsular boundaries were
drawn in the mid 1920's to fix limits of Britains mandates with
the newly formed Saudi kingdom, including th Saudi-Iraqi
Neutral Zone. A second neutral zone between S.A. and Kuwait
is also a legacy of the same period, and was also negotiated by
the Colonial Office. Elsewhere on the Arabian Peninsula perm-

anent boundaries have yet to be drawn. Even Iraq and Iran after
deciding on borders in 1937, have in the past decade decided
they still have some basic differences along the "agreed"
dividing line. The lack of ironclad boundaries in an area where
the "gold" is a subterranean liquid, constantly leads to border
disputes, and until ironclad boundaries are decided upon or all
the oil is used up, which ever comes first, then d.sputes will
continue to arise.
The cultural differences between the Iranians and Arabs are
also a cause of resilient problers. The distrust of Iran may
also have something to do with the Shah's thinly veiled plan
..of becoming a Persian Culf superpower. On the other hand the
Iraqi's, as the regional maverick, have succeeded in aliena-
ting all the Arabian Peninsula countries and Iran. The radi-
cals regimes have been plagued by disunity since !asser's
death, Arab disunity would immediately vanish, however, if
any non-Arab state such as Iran or an extraregional power,
were to attack on Arab state.

In October, 1973 the Arabs and Israelis went to war for the
fifth time. The oil weapon had been used in 1956 in limited
embargoes against Europe. Why not use it now they said. On
October 17 Abu Dhaha, Algeria, Bahrein, Dubai, Egypt, Irac,
Kuwait, Libya, Qater, S.A. and Syria met at the Kuwait Sheraton
to discuss how to use the oil weapon most effectvelv against the
pro-Israel West. The ministers decided to cut Drduction by a
minimum of 5%. What ensued was a contest to see who wculd
raise prices highest. Libya on October 19 announced it was
raising prices by 28%. The Sa!idis cut production by l% the day
before. On the same day Abu Dhabi announced it was embargoing
the U.S. Iraq proclaimed it would raise prices by 20%. Saudi
Arabia and the other oil producers decided to embargo the U.S.
and the Dutch. The end result of the embargo and the price rises,
both before and after it s has been about a 400% rise in the price

of mid-east crude since September, 1973.

The price increase has riven the countries of the Persian Gulf
a tremendous boost in income and power. With fairly small
populations, much of this new income is finding its way into
arms purchases. The three biggest purchasers in the Persian
Gulf region are Iran and Saudi Arabia, who by from the West,
and the Soviet clien+, Iraq. In order to understand the full
implications of these massive new juggernauts it is necessary
to closely observe-the internal political situation, the nature
of the arms buildup and the foreign policy of each o these
countries.

Ever since the overthrow of King Nuri al Said in 1958, Iraq has
called itself a republic, a military republic. The cruntrv is
ruled by the army and orderly succession is a rarity. Instead

leaders are changed in coups d'etats, and each rilitery govern-

ment faces the possibility of being overthrown by rival
officers. The problem is further compoun - ed by the axiom
that leading military and political leaders mut be Sunni Arabs.
The problem here is that the Sunnis are a Iraqi minority and
face opporsition from the Kurds and to an extent, from the
country majority, the Shii Arabs,

With five changes of regimes in the past decade the Iraqi

are far from continuity in tbir policy or leadership. Instead
each regime ends up with an overriding purpose of serving them-
selves instead of the people. Yet despite this, the Iraqi
parade themselves as the upholders of Arab virtue, prrrrioters of
Arab nationalism, and the preserves of Arabism in the ulf.

Iraq is in a bad position geographically, with less than 50

miles of coastline, most of which consists of rudflats. Its
two ports are extremely vulnerable. When the takers get
through to either of these slightly inland ports of Fao or
Umm Qasr they must pass through both Iranian and Kuwaiti gun-
sights.

While the desire to more than double oil revenue undoubtedly

was an incentive in Iraqe endeavor to ta-e over Kuwait in 1961
the desire for adequate, defensable ports definitely played a
role. Being pretty much on the outs with rost of its neighbors
it would be of immense value to the Iraqi to have a port
directly on the Gulf. The move to acquire Kuwaiti territory
in 1973 is widely interpreted as an attempt by Iraç to "negotiate'
the transfer of two Kuwait islands to Iraq. Iraqi troops
actually had their flag raised on one of the islands fr over
a year. Legally recognized possesion of the islands would no-
only grant Umiii Qasr greater security to the port but also
justify the Iraqi claim to drilling rights on the continental
shelf. If Iraq had been able to gain control of the islands
her ports still wouldn't be safe, and so it can not be assumed
that these acquisitions would have satisfied her territorial
arnbitins.
6
Having been in tower since July, 1968 the Baathi socialists
seem to be in firm control. In 1970 the Iraqi finally stabilized
the decade old Kurdish revolt. Though the Iraqis appeared to
have ended the war the Iranians started to give more advanced
help to the Kurds and the war resumed. In Pay, 1975 however
the Iranians agreed to stop aiding the Kurds. The Iraqis were
then able to crush the rebellion,

In October 1 73 Iraq and Iran settled their border dispute.

This agreement which had been ruptured 22 months earlier over
did not
Iranian aid to Kurds alsovallowed the Iraqi to engage 18,000
of its 90,000 troops in the war against\Israel cn the fcla.n
Heights.

Despite the recent accords with Iran, Iraq still distrusts

Iranian intentions in the area and greatly fears an Iranian
attempt to deny her access to the Persian Gulf by means of her
gun emplacements along the inlet to Umm Qasr. Related to this
fear, and also her own imperialistic pins Iraq is beinr armed
/
by the Soviets. Recently the Soviets have sold over $2.4 billion
worth of equipment to the Iraj, The Iraqi armed forces include
90,000 regular troops, 250 9 000 reservists, 1 1 065 tanks, 1300
ARC's, 224 jets, 69 helicopters, 30 warships and an undisclosed
number of Mig 21's and SUt7 1 s purchased this year. The Russians
in addition to their 3000 advisors in the country have pilots
flying advanced M1-23's and TU-22 1 s even though Soviet influence
is so great, Iraq is showing an increasing interest in Western
roods and technology. Iraqs U.S. imports have gone up from
57 million in 1973 to $284 million in 197' and to almost $600

million this year. These arms benefits are part of a. 15 year

treaty of friendship which the Iraqi and Soviets drew up in
1970. It is believed that in exchange for the arms the Iraqi
have allowed the Soviets to start construction of a military
base near Mosul and Kirkuk. Iraq has been loosening its ties
with the Soviets and is gradually entering a period of in-
creased ties with the West. It appears little love has been
lost between the two, however, but Baghdad's decision not to
break completely with the West must makr the Russians think
twice about the value of Iraq as the Soviet lyncbpin in the
area. Above all the Iracis new policy of the amassing petro
dollars must be watched to see how hard the Iraqis press
their defense posture.

Since 1951 the U.S. and Iran have had a special relationshi,.
Starting in 1951 we gave annual grants for a number of years
until the Iranians had enough petro dollars to buy their-own
weapons and run their own economy. After the fall of Dr.
Muhamined Musaddiq in 1953, the Shah was prepared to accept
large quantities of United States aid. Between 1950-66 we gave
the Shah $670 million worth of military equipment. This flow was
accelerated after the 1958 coup d'etat in Iraq. In the mid 1950's
Iran was brought into \çENTO.as one of the forward defense areas
and a bilateral treaty was drawn up with the United States,
The Shahs reasons for acceptinr the r,ssve U.S. aid were
fairly straightfcrward: first there was his genuine fear of
the Soviet Union because of the 1946 Azarbayjan crisis, and
the historic Russian desire for an outlet to the Persian Gulf,
Second, the Shahs narrow political base relied heavily on
army support. For this reason he had to make sure equipment
was constantly updated and that the pay was god. The Shah
also had to consider the vulnerability of his oil facilities
and possible hostile actions by local Arab powers on the
shipping lanes of the Persian Gulf. The-Shah had to worry
about the Iracis in this respect. The purpose of the aid was I
not to defend the oil fields by force, but to have a combined
army, navy and airforce capable of deterring any attack unon
the oil fields for fear of a retaliat'ry strike. There was much
concern in the State and Defense Department tat Iran iht use
the U.S. weapons for other than our forward defense area our-
poses. Despite this hesitation, the relations between the U.S.
and Iran were very good during the period of ou military
assistance program. The Shah was pro-West, and though he wished
to raise oil prices, he never did. When Iran was trying to shift
itself into a more neutral position our policy didiYt prevent
the Iranians from making an arms agreement with the Russians in
1967. Iran with its 32 million people has remained largely pro -

West and is more and more so. Outlasting several internal crise
the Shah has managed to excercise singular control over the country
for over 30 vears. Starting in 1970 the Shah began a program of
economic and social expansion unprecedented anywhere else. He has
 I'

employed the steadying rise in oil revnue to create new

industries. Under his leadership the CNP almost tripled
between 1960 and 1970, rising fror.$4.9 billion to 10.8
billion. The Shahs goal is to make Iran an economic giant

to rival West Cerrany by 1980 and to surpass Europe by the

year 2000. Hand in band with his economic expansion program
has been a program of military expansion. The military pro-
gram has accelerated so fast that Iran is now becoming one of
the greatest non-nuclear forces in the world,

The Shah reasoning for the buildup is a direct outgroth of

his reasons for accepting U.S. military aid back in the 1950's.
His main point however is that since the British left in 1971
the Oulf has taken on a new vulnerability and that Iran is
able and willing to step in and be the gulf policeman. In
addition he says he has to serve as a counterweight against
Iraq and the Soviets and all other radicals in the Gulf and
that his powerful armed forces serve as a stabilizing ,factor.

It appears, however, that Irans motives - are more than just

defensive. It is known for instance that th Shah is convinced
that the West is in a period of decline, and that the East will
rise up over its ruin. The Shah wants to rise up over theEast
and has accordingly assembled, unilaterally, a juggernaut. It
is interesting to note that Irans military purchases were $961
million in 1970 9 while Iraqs were $477 million and S,A.'s $213
million. In 1972 the numbers were 2 9 452 million for Iran, 59
million for Iraq and 674 rillion for S.A. Clearly firures like
these show that if the Iranians are preparing to defend ther-
selves against anyone its the Russians, not the Sandi or Iraqi.
Even without detente, the odds are overwhelmingly against Russia
attacking Iran, or any oil field that provided th West with a
large percent of its oil. An attack on such would definitely
bring us to the brink of a nuclear showdown, because that oil,
though not ours, is vital to Western security.

If not defense then what do the Iranians plan to do with the

largest military hovercraft fleet in the world.

180 Phantoms in a fighter force of 300 which doesn't even

include its forthcoming purchase of 250 YF-16 1 s, 700 choppers
including 200 gunships and 700 tanks. All totaled within five
years Iran will have the worlds third or fourth largest airforce,
and the fifth largest non-nuclear force.

Though the Shah is sandwiched between two trouble spots, the

Arab-Israeli area and the India Pakistan area it appears tat
he has overreacted. According to Iran they are worried about
certain areas in the region and have taken necessary actions
to ensure Iranian security. These dangers are the breakup of
Pakistan, the Afghanistan coup, Indian designs on the Persian
Gulf, and Iraqi intrigues and agression. Ilot all these fears are
real however, India, despite its atomic bomb det-'nation is
• too involved in its internal politics to get involved in
foreign disputes. Iraq, Irans major foe, will only go as
far as Russia permits, and it has been pointed out before,
Russia isn't going to get themselves invol"ed at this time.
There is of course the chance that the Iraqi could act on
their own, but they probably Won't. The Shah has seemingly
mended his fences with the Saudi and the other locals. There
is however, a great deal of suspicion between the Persians
and Arabs.

Iran has made much progress, but tis does not gaurantee
political stability. The extreme right and left oppose the
Shahs one man rule. There are also seperatist tendencies in
Khuzistan and other areas.

If his opposition is not strong neither is he exceedingly

popular. His secret police, SAVAX with 5 ,000 members does
a fairly good job of routing out the Shahs opposition. They
have inprisoned over 20,000 people without formally charging
them with a crime. This lack of civil liberties and the $500
per capita income in light of the 20% defense budget des
tablizing factor. This kind of opposition cruld lead to a
coup. It is this ultra conservativism whic allows many
Iranians to live at poverty levels, and the natural reaction
to it, that lead many Western analysts to view t-e Iranian
regime as unstable, it is also pointed out that the Shah has
so cenUlLd the government around himself that when he

dies, the nation may fall apart. If it does fall apart the

amount of arms in the country could lead to a catastrophe.

It is clear that the Iranian buildup is for mainly two reasons:

first, to insure itself against either internal or external
disorder, and second, to gain a position of hegemony in the

Persian Gulf region and inevitably in all of Southwest Asia

The success of this policy is based on no states challeng-

ing her at her new position, or an arms race would probably

ensue. We have already seen that Iraq is not going to

aquiesce to Irans new position. Will S&udi Arabia?

The leading force in the Arab world after the October war is

not Egypt or Syria, it is Saudi Arabia. This country of 5.5

million occupies 83% of the Arabian Peninsula and sits on over
30% of the worlds petroleum reserves. The country was founded

by the Islamic Wahabis, a Saudi tribal coalition. Saudi Arabia

is the only state in the world named after its ruling family.
It is the most paradoxical place in the world. In a land of
ultra modern oil wells, public floggings and executicnsare
common fare and the police enforce the Koranic Code, 33% of the

people are nomads and 50% are illiterate. Unions, free press and
political parties are outlawed. Saudi Arabia owes its existence
to the U.S., and it was there that U.S. gaind its first mid-
East foothold. In the 1920's the Saudis went intc an ecnomic
slump due to a lOSS of the income from the haj (Muslim
pilgrimage to Mecca). To raise funds King Ibm Saud turned
to the U.S. and granted a $120,000.00 in oil concession to
Standard Oil of California (SOCAL) which joined with Esso,

Texaco and Mobil to form the Arabian-American Oil Company

(ARAMCO), which was pumping oil by 1938.

In W.W.II when Saudi oil exports were cut off, King Saud
turned to the U.S. governrent for the $10 million he needed
to run his government. Harry Hopkins urged the money, even
though he said it was hard to "call that outfit a democracy".

In 1943 the U.S. decided that defense of Saudi Arabia was vital
to U.S. defense. A military mission arrived to train.Sauds
nomadic troops, and we built an airfield at Dhahran, the

biggest one between Germany and Okinawa.

By 1947 Saudi's had been given over 8100 million. In 1950

ARAMCO finished the TApline and in 1951 it built Saud a
road from Riyadh to oil port of Damman. ARAMCO also trained
pro-Saudi dissidents in the neighboring Sültanate of Oman who
were challenginF British domination.

In 1953 King Saud died and the Saudi's tried to become partially
independent of U.S. In 1954 relations further deteriorated when
the Saudis refused $.l million in aid because it was too small
relative to the foreign aid the Israelis were receivir1. In
1956 the Dhahran base agreerent expired, and the Saudis would
..only renew it for periods of a month at a time.

John Foster Dulles decided that Saudi Arabia was important

to the U.S., so the new King Saud was invited to Washington
to meet with the preident. After his visit the Saudis
agreed to renew base rights for 5 years in return for the U.S.
training, equipping and. doubling, the size of 15,000 man
Saudi army.

ifl 1954 the Saudis were given a 25 million Foreign Assistance

Act grant. Also in 1954 Prince Feisel replaced King Saud, an
incompetent ruler. King Feisal made Saudi Arabia a bulwark of
anti-revolutionary nationalism.

In 1962 the U.S. formally evacuated the Dhahran Air Ease. But
in 1963 when it appeared that Egyptian forces inorth Yemen
were about to attack the Saudis, the U.S. sent back lets and
paratroopers.

Though the Saudi military buildup has enabled them to crush

internal opposition the frecuencv with which internal opposition
must be crushed reveals a fundamental weakness of the Saudi
regime, The people living in such a backward state in the
midst of such wealth are naturally prone to be restless.
Furthermore this restlessness can often be a factor leading to
instability, and in the long run this restlessness may under-
mine the regime.
Sta nobly anti-communist and anti-radical, the Saudi rovernment
equally fears the over-ambitious Persian across the gulf. This
situation is further exacerbated by the fact that the Saudis
are as determined as the Iranians to be the leading power in the
region.

Thus we are faced with a potentially catastrophic situation.

Three countries, each mutually fearing and distruting the
others are now in the process of arming to the hlt for some
as yet unknown purpose.

The Iraqis have always been a fairly militarized people, but

their potential actions that could be construed as hostile by
either country are minimal, excluding, thet is, domestic sub-
version which is something which will always be a possibility
due to the narrow bases of the Saudi and Iranian power. In
supposed reaction to the Iraqi military "machine" and the
small mini radical states the Iranians undertook an arms pro-
curement pattern unparalleled anywhere in the Gulf, 1t alone
the world. With her rival Iran skyrocketing towards becoming
the worlds fourth or fifth largest armed force in the world,
King Feisel was reluctantly forced to join the game. At
stake, in his mind, was the security of the whole Gulf and
the honor of Saudi Arabia.

Saudi Arabia is now engaged in an effort to, catch up to the

Iranians. Though reluctantly, the Saudis are now spending
billions of dollars on highly advanced weapon systems. The
Saudis have either recently procured or ordered 200 F-5E's 30

F-4 Phantoms, 38 Mirage 3 9 F-lu Tomcats, A-7 Corsanes, 20 F-5B'.

All the Saudi fighters have a minimum of Mach 2 speed, These
fighters have been extensively modified for the Saudis, The
Saudi craft will be fitted with EMC's, anti-tank missiles, the
new Magic dogfight missle, laser guided and "smart" bombs.
The Saudi F5E's are better equipped than the simple air defense
fighter purchased by the original recipients of the craft.
Besides being fitted with the Litton inertial navigators for
easier navigating and better aim on bombing targets, the Saudi
F-5E's are rigged for inflight refueling to increase their 680
mile range (for other than defense roles), The Saudis are

buying tanker versions of the C-130 transport from Lockheed.

The U.S. has also agreed to tr-in and equip Saudi Arabias
national guard, a para-military force whose sole lobs are to
keep domestic order and to protect petroleum installations.
The guard will be equipped with the M-60 battle tank with
105 mm guns. The U.S. is also building up the Saudi Navy
by selling them 19 ships and an extensive program in building
port facilities. In 1972 the U.S. Army Corps of engineers
began building Saudi port facilities at Jiddah on the Red Sea
and at Jubayl on the Persian Gulf. This work for the Saudi
Navy will cost $1 billion. The U.S. will also provide the
training for the use of the ships.
 -

This Navy program is indicative of our new involvement

in Saudi Arabia. Our 1 9 000 man entourage in Saudia Arabia
is expected to be 35,000 within five years.

To organize and channel U. S. assistance the U.S. - Saudi

Joint Commission on Security Cooperation has been formed. One
of the major aims of the program is to.: review Saudi defense
and make and implement recommendations for the betterment of
the Saudi defense.

The U.S. Army Corps of Engineers has been in Saudi Arabia

since the 1950's handling all kinds of jobs from installing
Saudi T.V. stations to building airbases.

In the late 1960's the Corps started to build Saudi bases.

One finished in 1971 on the Yemen border is a base for 7,500
men, a second base near the Jordanian border was corp1ted
in 1974, and the third, near the Kuwaiti border features an
airfield. The total cost of these three bases was $356 million.
The corps is also building a $10 million Air Force headquarters
in Riyadh and is preparing the base at Dhahran for the F-S's at
a cost of $65 million.

As was previously mentioned the U.S. has agreed to revitalize

the National Guard. The $150 million
constructed by the Corps. As it is becoming prevalent to do,
the training og the Saudi Forces io being sub-contracted by
the Department of Defense to private military contractors.
These companies usually enlist ex GI's from the Vietnam-War
and send them to Saudi Arabia, The Vinnell Corporation of
Los Angeles, a long time Fovernrent contractor, is respon-
sible for the training of the National Guard. Vinnell has
1,000 men working in Saudi Arabia. Most of the private
contractors engaged in governmental contracts usually train
the foreign troops in the operation and maintenance of its
product. Bendix has 700 men training Saudis in military

vehicle operation and maintenance. Northrop Corp. employs

545 men to train Saudis how to fly and take care of the F-S's
that will soon be arriving. Lockheed has 50 men there to
provide assistance to the chief of the Saudi Air Force.
Raytheon has 50 Americans in Saudi Arabia instructing the
Saudis in operation and maintenance of their recently purchased
Hawk surface-to-air missile system. The largest aerospace
utilization of U.S. personnel is by AVCO Industries with
more than 1,000 of its employees working in Saudi Arabia.

The Saudi Arabian Air Force development program known as

"Peace Hawk", employs over 700 pentagon employees and ex-
military men now working for Raytheon, Northrop and Lockheed.

The airforce' planning committee and the U.S.A,F. assisted

the Saudis in developing an air defense system. The new
system of Hawk SAM missiles will fill the present gaps in
GEC-Marconi system. The old system was built with warning
line along the Hejaz.. The system was arranged in a
formation to guard against an Egyptian attack. Now that
Saudi Arabias threat comes mainly from Iraq on the north and
Iran on the east, with some threat from South Yemen on the
south the present system is outdated. Lockheed 'has won a
$160 million 5 year contract to operate the Marconi system
and design improvements.

The U.S. involvement in Saudi Arabia is clearly great and

has long term implications. Our sales to Iran and our presence
there which rivals qur presence in Saudi Arabia is clearly
increasing. The advent of these juggernauts and that of Iraq
has had immediate effects on the cther states of the Gulf.

Kuwait though very wealthy is in an extremely vulnerable

position. The recent attempt of Iraq to sieze several, of
its islands, and the arming by both Saudi Arabia and Iran
has made her nervous. Though probably futile Kuwait has
started to arm. For fiscal 1975 Kuwait allocated $1.5
billion to arms acquisitions, this is up from $389 million
in 1974. These purchases have included the French Mirae F2
French Gazelle Helicopters, U.S. A-'i Skyhawks,and Hawk anti
aircraft missile batteries. Kuwait is presently negotiating
the purchase of F-E Phantoms from the U.S. Much of Kuwaiti
weapons go to Egypt along with a 2 - 3 hundred million dollar
subsidy each year, to ensure itself so that in the case of an
Iraqi attack she can hope for support from the Saudis who hea 4 i1y
underwrites the Arab jihad against Israel.

Oman, though not directly related to the buildup in the Gulf,

is also acquiring new weapon systems. With money from its
conservative supporters, Iran and Saudi Arabia, and LQ% of its
own budget, Oman is purchasing new weapons. Oman is doubling
the size of her navy and increasing the size of its army and
air force to fight the leftist rebels in Dhafar. She has
also purchased a number of the AngloFrench Jaguar fighters to
possibly take the war to South Yemen, base of the rebels. From
the U.S. she has purchased helicopter troop carriers and
missiles. From the British she has an air defense system.
With 1,300 Iranian troops on her soil fighting the rebels in
Dhafar she is a bit worried over the Shahs true intentions in
light of Irans military buildup. Iran is using the Dhafar
insurrection as a means of testing its new weapons and fighting
techniques. The Iranians have brought in fighter bombers and
helicopter gunships to deal with the Soviet backed guerillas
from South Yemen. When, and if, the insurrection is crushed
the Iranians will hopefully leave. Unfortunately this may not
be the case, for the Shah has vowed to protect the small states
along the Arabian peninsula. What better way to protect than
to achieve control.

The United Arab Emirates, fearing the Saudis, the Dhafar and
Yemenite radicals, as much as Iran "protection", have also begun
to arm. Dubai has bought Hawk missiles and French Mirages,
Abu Dh41 recently acquired 2 C-130 -transport and 4 Italian
attack aircraft and a British air defense system. The Emirates
main deterrent to agression is the nwber of Brittish officers
and advisors still present in these states. It is probable that
if the British were to withdraw, as many leftist elements
ask, that the U.A.E. would fall prey to the hungry eyes of
Iran, or Saudi Arabia who may take "protective custody" over it.

The recent buildup in the Persian (ulf,repardless of the reasons

espoused by the participants has definitely exacerbated the
volitility of the situation. The heavy arming by !ran has
caused the reflex action of heavy arming by Iraq and Saudi Arabia,
The heavy arming by the three, though it stabilizes outward
relations, results in an intensified arms race as each one of
the three tries to outdistance the other two with a new
quantitative of qualitative boost. The new arms may have
appeared to stabilize the situation, but on the other hand
these new powerful weapons will greatly enhance the possibility
of a minor clash escalating into a malor confrontation. Thourh
the detente may stabilize the situation between the big three
it has irritated the relations with the small shiekdoms and
emirates. Not knowing which one is going to make the first
move, but knowing one eventually will, these small states are
engaging in an effort to defend themselves against the force of
Iran, Iraq, or Saudi Arabia,, The big countries have the oil
revenues to support both industrial and military expansion -
for a time. The small states can't afford it so they're
allocating the bulk of their spending to defense.

There is no mce pax Brittanica, there is no entente to

replace . Instead we have an accelerating arms race gripping
the area. Though the arms race has been going on since 1971,
it didn't get into high gear until 1973. In 1973 the fifth
Arab-Israeli war took place. This new erring program re-
quired the consent of the West. The ultra-conservative
kings, shieks, and emirs wouldn"t have turned to Ioscow for
arms. As a high official of Oman said, "Any question of
the Gulf states cooperating with the Russian is like a
foolish lamb offering to gambol on the hillside with a hungry
lion". Clearly there were no contenders for a place with S.
Yemen and Iraq in Moscows basket,

Though the United States was supporting both the Saudis

and the Iranians for many years it was, or at least appeared
to be, strongly against contributing tca massive arms build-
up in the Persian Gulf, it wasn't so much that the U.S. didnt

want the Saudis and Iranians t' have military juggernauts, it

did, but it didn't want to have to explain the sales to Congress,
or more iinortant1y it didn't want to open up the region to
potential superpower involvement. As was the case with Israel
until after 1967, the U.S. was willing to let its interests be
militarily supplied by its West European allies. The .threat of

indirect Soviet intervention in the area in conjunction with

local subversives has been ral in the minds of the U.S. State
Department from the 1946 Azerbaijan crisis until the days of
detente. No one in the U.S. government was willing to risk
turning a region of immense importance to the West and Japan,
into a potential battleground for the Cold War. As long as we
weren't directly there in force, or weren't drectay supplying
our friends with quantities of arms like those that have been
traded in the past few years, we enjoyed a distinct roral
advantage over the Soviets. Yet something caused us to
change our tclicy.

Our unilateral morality only existed up to a pcint. The U.S.,

worried about the oossibility of the Soviets establishing a
Persian Gulf fleet, has.recently acted. In addition to our
formidable presence through Iranian patrols in both the
Persian Gulf and Indian Ocean, the U.S. has recently taken to
"showinr the flag" in both the Gulf and the Ocean. We are also
upgrading our small naval bases at Bahrain and on the Omanian
asira Island in addition to a major exspansion of our base on
the British held island of Diego arcia. This is not an over
reaction. With te opening of the Suez Ca-al the Russians will
be able to easily transfer their ships from t:-ir Veditteranean
Fleet to their Indian Ocean Fleet (we don't even have an
Indian Ocean fleet yet). The Soviets already have well developed
ports for their fleets in S. Yemen, Somalis and Iraq. The
base in S. Yemen is particularly well developed, with anchorage
facilities, airfields and over 2000 advisors.

Our reaction to the Soviet naval buildup has been mostly over
the last 2 years. Though there have been many attempts to
link it with our decision to allow the sae of arms to the Gulf
it probably wans't our major reason. This is not to deny the
validity of the claim that our sales to the Persan Gulf dis-
courage Soviet agression in whatever forr it may take. They do,
 and if it ever came down to a showdown between the Soviet

backed states and the states we back our proteges would most

probably win because of our recent arms sales. But contemporary

international politics probably will not lead to such a con-

frontation. There rust have been something else that caused us

to reconsider and then reverse our policy.

Oil. In 1973 the Arabs and Israelis fought their fifth war.

The direct outgrowth of the confrontation was a 400% increase

•-in the price of foreign crude. Although it is obvious it is

imortant to remember that the prewar price of oil was not
restored after the October War. In fact it has risen even

higher. The war was just a catalyst for a r-action that was
going to take place anyway. Though the Arabs and the rest of

OPEC knew this, the West had been caught off guard. For

several years it had been the Iranians and Venezuelans who had

clamored for the oil price hike. When the Arab oil produers met

on October 17 they knew what they wanted to accomplish. Sure,

the oil weapon did become handy for the Arabs in 1973, and it

did accomplish its purpose of getting no-t of the world t, at

least outwardly, break with Israel. It was the fact that most of
the Western European countries broke with Israel that engouraged

the oil producing countries to keep their prices so hi, If

Europe had gone along with the U.S. hardline pOlICY ag'iflSt

OAPEC, while strongly supporting Israel, the Arabs wcu.d have never
gotten awav with the increases. When the Arabs saw the govern
ments of Europe break with the U.S., first over Israel, and
then over cii, they knew they would win. A strng unified Policy
in the West from the outset would have convinced the Arabs
that we wouldn't let them get away with it. Instead, with the
first whispers of oil retaliation, the Europeans, all except
for Holland, were falling all over each other tring to Show the
Arabs how anti Israel they were. The Eurpean Economic Community
split up into its individual components, each one more obsequious
in its pandering than the other. The Europeans revealed the
depthe of their deprivation by going so far as to secretly
agree with OA?BC not to provide oil to embargoed Holland. If
the Europeans would sell each other out for cil they certainly
weren't going to join in a U.S. get tough policy. The Arabs
realized this and raised the prices even higher. The U.S.
then realized the 17 i cations of cur split with the Europeans,
and the Europeann division among themselves. The West couldn't
make OPEC backdown. Figh oll prices were here to stay.

The initial U.S. reaction was to attempt to beat the crisis. This
was to be done by encouraging the production of new energy
sources and general conservation. Though Europe relied on
Mideast - oil for 85% of its oil. añ1 Japan 90%, the U.S. only
relied on it for 5%. Some areas, such as New England were
of course more dependent than the rest of the cuntry, but
we assumed we could drop the idest oil out of our picture.

Afterall in 1973 the U.S. only imported 1 million barrels

per day from the Middle East. Energy czar John Love's directive
to lower thermostats by 3 degrees would save -, 550,000 barrels i

a day. An all-out energy conservation program would save. 3.3

million barrells a day.

With Project Independence hardly off the ground the U.S.

realized that OPEC could not be broken. The U.S. would now
have to pay extortion!st prices for all of its imports. The
U.S. was not going to surrender easily. First we asked our

European allies to join with us in attempting to impose our

will on OPEC. The Europeans were still not willing to go along

with our proposed policy. From hard economic policy the

President and Kissinger started hinting that the U.S. might
unilaterally intervene militarily to prevent the economic
strangulation of the vest. This hard line policy ended in
failure.

In 1972 the U.S. trade balance was $7 billion in the red. In

1973 the deficit had swung back to a surplus. With the advent
of the Arab oil er.baro the dollar strengthened dramatically on
the European money markets. This was due to two reasons, first,
it was assumed that the European and Japanese economics would
be set back by the oil price increases, and second, the U.S.
would probably become market for new Arab funds. The dollars
"trade-weirhted" value rose by 14.7% between Jul- 1973 and
January 1974, Drinr the Spring the crunch became less in

Europe, so the trade weighted value of the dollar lost about

2/3 of its postembargc gain.

It is clear that the future cf the trade balance is linked to

amount of oil imports and the price we rust pay for these
imports. In 1973 we paid $7.5 billion for imported oil, in
1974 we paid over S21 billion. The U.S. position looks better
when international transactions are taken into account. Our
net income from international investments was $9.7 billion in
1973. This figure is bound to skyrocket due t the influx of
Arab oil money. Export orders for U.S. durable goods to the
Arab states has more than doubled in the last two years. The
reason for this is that U.S. roods are relatively cheaper nrw
ii comparison with European products. The trade weighted value
of the dollar is 20% lower than it was in !av 1973, when the
U.S. upset the whole international monetary system. Yost of
these new durable goods orders are for long-lead-Tire items,
which are rising - i.e. they will be strengthening U.S.
export demand for years to come. Typicalof these are engines,
turbines, aircraft, ships, industrial racinerv, electrical
equipment and military hardware. Plenty of short-lead-time
items are also doing well, and should continue to do so.
Our grain sales to the Arab nations are at record highs.
Petrodollars now purchase foodstuff that were once foreign aid.
As the Persian f7Iulf countries attempt tc rapidly industrialize,
their first projects are the greater utilization and control
of their oil, from well to pump. This energy related indus-
trialization is providing a gold nine for U.S. in sales of
natural gas licuification plants, tankers, oil pwrpng
equipment, pipeline ect. The only problem of U.S industry
in light of energy money crisis is that as other countries
are forced to spend a greater percentage of their capital on
oil imports, their other imports will go down. The way U.S.
industry is combatting this, is by attracting the oil •revenues
from the Persian gulf countries, that would have been spent
here by the Europeans.

The dramatic increase of oil prices 1; equivalent to a tax

levied on the consumers by the producers, This tax promises,
according to Vathaniel Samuels, a partner of 1 ,uhn, Loeb C Co.,,
"to transfer wealth from one set of countries to another on a
scale and at a speed never ex2erienced before". Ultimately,
however, it seems likely that the wealth will return to the
industrialized nations as payment for their goods and services.

If all of the petrodollars were used by their recievers to

buy goods in the non-communist Wet the West would be sending
20 30% of its exports to OPEC. We sold then t% in 1972. In
fact orders from these countries will almost definitely
account for less than 20%percent of our exports because the
oil producing countries do not have either the population nor
the technology to absorb such a quantity of roods. The key
to solvinr, this problem is the sale o ar, for any rich
country can buy as many arms as it wants witho;t regard to
their internal population or technology. The factors in
buying errs, at least for the Persian rul.. appear to be
first and foremost the ambitions of the ruler, second the
internal opposition to the ruler, and third if number ono
is lacking, how many errs do your neighbors have. The fact
that these countries don't have a sufficient technical ability
to operate and maintain these weapons without a U.S. presence
is a major safeguard that the U.S. has in preventing our
clients from becoming overly ambitious. This will only he the
case for a few more years until the indigineous population
becomes skilled in these technological tasks.

Within a few years the OPEC countries will add $135 billion to
their treasuries -- a sum equal to all the reserves of the
industrialized nations. Projections for ten years from now
suggest two to four times that number for OPEC. The
only markets that can absorb this much money are those' with
well developed economies. The U.S. has a great advantage over
Japan or the West Europeans in this respect because it has the
best developed economy, the greatest capacity for industrial
expansion, and -- most importantly, import much less oil
percentage wise. Thus we will attract the new Persian Gulf
money which is being paved by the rest of the world. We
will attract that money in the U.S. and because we spend
comparatively little on oil imports we stand to gain
so much more in the len run.

One reason against out economically motivated arms sales

policy is that our aiding in this cartel's success ray lead
to a cartel fever, an action that would devastate the West.
If we are to give the Persian ulf states the arms they seek
with no restrictionsi in addition to starting a highly volatile
region on a shaky course, we may start other third world groups
to band together and withhold their products hoping to "trade"
them off for arms.

Another problem is that low-exchange rates have a terrific in-

flationery impact precipitated by increased demand f cm domestic
items overseas. The solution for this problem is to sell arms
to the qulf. Proponents of foreign arms sales also cite facts
that for every l billion in foreign sales leads directly to
31,000 new jobs, and creates another 60,000 indirectly, The
Persian Gulf sales also keep our, defense industry from going
under in the post-Vietnam slump. For example, a recent Iranian
purchase of 80 FlL Tomcats saved Gruman from insolvency. Also
a major factor in the OD's enthusiastic attitude on the sales,
is that foreiFn sales allow us to continue domestic production
lines, lowering unit costs to the Defense Departinent.

Though most of the short term effects of the sales will he

beneficial to U.S. economy the long term consecuences of
such an influx of foreign money could be disasterous. This
Possibility is based on the assumption that present currency
floating patterns will reTrain fairly constant. As invest-
ments increase the U.S. economy will switch from a domest'o

minded to export minded structure, but as the exchange rate

continually rises, reflecting the rise in the value of the

dollar because of our new foreign investments, foreign

investment will slow, reflectinr the relatively more ex-

pensive position of V.S. products due to higher exchange
rate, then as investments fall off the economy will lag
and the exchange rate will again fall. This cyclical pattern
is bad news in the long run, because our new foreign market
will eventually start importing lass as their own industry
improves.

So here we have the U.S. policy, highly motivated by economic

interests and secondarily motivated by eld war tendencies.
In broad terms the U.S. has five policy objectives; first, the
support of regional collective security plans to offset any
Soviet or leftist ambitions in the area, second the encourag-
ing of better relations between the states of the area, third,
the expansion of our diplomatic, cultural and financial
presence, fourth, the maintenance of access to oil at reason-
able prices, and fifth, the recycling of petrodllars.

The official rationale for allowing the arms sales was stated
by Secretary of State Rodgers as Fl. fey maintain balance of
power, 2 if we don't gell the arms someone else will, 3, the
buyers have cash, ', they keep the rulers friendly, and 5 9 it
helps our balance of Davrents, any of tHese objectives
and supposed policies seemed to conflict with each other in
light of the actual pciicies so Congressional corrmittees
held hearings.

Though there were a few minor hearings on the Persian Gulf

arms sales in 1974, these came to no agreerent and were held
with little fanfare. Last June however, in response to dis-
closure that Northrop paid $450 9 000.00 in bribes to Saudi
officials to sway then into ordering F-S Freedom Fighters1
he Senate Foreign Relations Committee held hearings. tt
was learned that the bribery practice was widespread. Though
no legislation was forthcoming many points on why, we shouldn't-
sell so many arms abroad were brought out'. These included, the
sals lead to U.S. m&zing greater commitments to the re-
cipient, U.S. maintains little, if any control over arms once
they are sold, sellinr sophisticated weapons detracts from
U.S. defense posture, and pardoxicallv, the arm sales could
lead to a conflict where both sides have U.S. weapons.

Ideally, the U.S,. and the West would not sell any arms at all
to the Persian Gulf Region, but unfortunately that is not the
political reality of the day. Many of t-e defense claims of
the local rulers are real. If we choose to support the Saudi
and Iranian governments we must provide each country with
sufficient arms to crush its political opposition. Of course
this puts us in the position of underwriting regimes which are by

no means •derrocratic. This is a commitment to the enforcerr.nt

of their policy of political and liberty repression. We

have no choice, the oil countries have a noose around our neck,

the, can arbitrarily raise prices and we must pay them because

we need the oil. Since the prices are so high Western civil-

ization will atrophy unless we use every possible means to

recycle these funds, the means we are using is arms sales.

They may be immoral and we certainly are "merchants of death",

but we need oil to live so we will continue to sell these

errs, ho kncws, someday the West may wake up and realize

precarious its situation is. On the,other hand if we dc

not awaken, several thousand veers of civilization may

eventually collapse because of a few egocentric rulers on

pcwer kicks,
 R! hlioaraphy

.."Arnhs Firirl eapon" Tre Docernber 31.273) 32

"America. Europe d the !:deast" Coramentar (February 197/)40-55

"Americas Flourderna Oii Policy" Ruai ness lee' (Tov. 23, 1974) 0-1

"American on Top Among Worlds Arms Peddlers" U.S. News and World Report
(Jan. 13, 1975) 24 - 25

"Can Petro Dollars Buy Super Power?"

"Change of Fortunes in Middle East: U.S. on. Upswing Russia Down"

(Apr 29, 1974) 3()-31

"0ler .nd Present Danzer: d-East anti J.S." Fulbrirht 2, 1.)'L

talSehe (Dec. 1.971') 102-107

"Confrtrtion r. the Fersn GU1" S. Trw rew ITenuhU.c Ma - 4. J.14

170: 15-17

"Congress Tkes Aim at dThst Oil Sales" Bdsiness Wee' (Mar 3 1975) 21-2

"Crises of Paying for Th€ 011" J. Pears-o.. 3usness ':Tee (May 11. 1974) 33

"Countering the CII Cartel: }Jssi.nser 5 Point Program" Time (Nov. 25, 1974) 36

"Decision on Saudi Advanced Weapons iears" Aviation Week (Feb. 3, 1975) 15

"Department Reviews U.S. Relation on. Arabian Peninsula and on Persian Gulf"
L. Atherton, Jr. Statement Aug. 7, 1974 U. S. Dept. _2fSt0te
Bulletin (Sept. 2, 1974 335-42)

"Energy War: W't We Must Do in Mideast" W.E. Griffith igest

(Feb. 1974). 95-
 aisl 211nd Oil; )rvir,Toward P, New kr1.] crdcr"

izrer In jJi o 7L, -'

"Giving the Shh ierythLng 9e Wants"

"iIow C1 1c iulers 'Isa &

'a 27.

£Dt rke kbrjd for :ar I:oeme't (eh. 21 ., rr) 24-5

1rn lid :' Sp-.rProchc , Jo

UIrans Shch: Key to U.S. Aims in des" U. . 'e':s ridRencrt

(Aug 6, 1973) 44

"Intervention: kissinger on U. S. Involvement" Tme (Jan. 20. 1975) 3h_5

"Liquid Gold: Fluid Politics" News Week (Feb. 19 1973) L9

"Military Regimes: Comparison of Expenditures" flational Review (Mar. 14, 1975)

262-3

"National Security Cartel: Our Blundering Oil Iiplomacy" S. Nordlinger

Nations (Apr 27, 1974) 523-7

"Nixon's Mideast Dilerrina " U. S. News and World Report (Jun 24 1974) 15-19

"Now Saudi Arabia" W Pincus New Republic (Mar 29, 1974) 8-10

"Oil and Arms: Battle Over the Persian Gulf" T. Szulc New Republic
Ju 23, 1973 21-23

"Oil Grab Scenario: Year of Force in Mideast" E. C. Ravenal New - Republic

Jan 8, 1975 14-16

"Oil, and Sympathy" Newsweek (Jun 18, 1 973) 46

"Oil Trade and the Dollar" L. A. Mayer Fortune Jun 1974 192-199

"Persian Gulf: U.S. Role in Struggle Over Oil" J. Law U. S. News and World Reort
May 21, 1973 90-94
"Petro Currency Peril" Time (June 17 197h) 83

"Policy By Stealth: U.S. Arms Sales and Advisors" Nation (Feb 22, 1975) 194-6

"Political Economy of Arms Sales" M. T. Kiareiet Sept. 1974 41-9

"Postmortem on Policy" Nation (Nov. 12 1973) 484-5

"Recycling Oil Revenues; The Role of The U.S." G.L. Parsky. Vital$peches
(February 15,1975) 282-284

"Return to Gunboat Diplomacy" on--(January 26,1974) 98

"Risky Road of Retaliation" Time (December 3,1973) 32

"Saudi Arabia: a cautious spender of petrodollars" Business Week (November 23,19705

"Saudi Arabia : the new breed of empire builders" Business Week (December 7,1974)42-

"Saudi Arabia; the wild card" F.Halliday. January,1974)43-44

"Shah Drives To Build New Persian Empire" L.Kraar. Fortune (October,1974)144-147

"Sub Empires in the Persian Gulf" B Rubin. Pro g re ssive (January,1975) 30-33

"Suppose the.U.S DecidèthtO Retaliate Againstthe Arabs" U.Sjews(September 10

1973)70

"Trying to Talk Oil Prices Down" Business Week (September 2 8,1974)30-32

"U.S.A.F. to Deliver F5E's to Saudi Arabia" B.Milier. Aviation Week(Movember

12,1973) 14,15

"U.S. Commercial Interests and 'Policy in the Persian Gulf Areallstatement

November 28,1973 R.P.Davies .U.S.D.SJ3. (December 17,1973)725-730

"U.S. F4 Sale to Arabs Seeks to Blunt Soviet Mideast Probes"D.A.Brown.

Aviation Week (June 11,1973)30
 "U.S,Deeper Than Ever In Mideast Troubles" U.S. Uis(July 1,1974) 19-21

"U.S.Oilinan in Arabia" Busin es s Week (September 2241973) 58

"U.S.Pushes Iran Air Defence System" Aviation Week (March 24,1975) 23

"Vietnam in Arabia? New War in Offing: Iranian Troops in Oman" J.Abourezk.

Nation (February 16,1974)203,4

"Vinnel Corporation plan to train Saudi forces"Time( February 24,1975) 16

U.S,News " " " 21
Newsweek " " " 30
Forbes (March 1,1975) 40,41
Business Week(February 24,1975)2

"War Syndicate.: Arms Trade" DMatern Commonwealth ( Decèmber0, 1 974) 3-266