The Ugly Truth About the U.S.-Saudi Arms Deals

What follows is a conversation between arms industry researcher Andrew Feinstein and Sharmini Peries of the Real News Network. Read a transcript of their conversation below or watch the video at the bottom of the post.

SHARMINI PERIES: It’s The Real News Network. I’m Sharmini Peries, coming to you from Baltimore.

One of the reasons that President Donald Trump has been lenient about reining in the Saudi Crown Prince Mohammed bin Salman over the death the Washington Post journalist Jamal Khashoggi is, apparently, that Saudi arms deals are good for the American economy and to create jobs in the United States, as is the war in Yemen. Trump has put himself at the center of the arms deals with Saudi Arabia, where he often talks about the number of jobs that these deals would create for the United States and he is primarily responsible for them, these jobs that would be created. Well, how many jobs will these arms deals create in the United States, according to Trump?

The president has said:

I worked very hard to get the order for the military’s 110 billion dollars. I believe it’s the largest order ever made. It’s 450,000 jobs.

They have a tremendous order, 110 billion dollars. Every country in the world wanted a piece of that order. It’s 500,000 jobs.

We have 450 billion dollars worth of things ordered from a very rich country, Saudi Arabia. 600,000 jobs, maybe more than that.

This is equipment and various things ordered from Saudi Arabia. 450 billion dollars. I think it’s over a million jobs.

I think that’s over a million jobs. A million to over a million jobs.

SHARMINI PERIES: Well, a recent exclusive report gathered by Reuters examines several internal reports of defense contractors, mainly Lockheed Martin in this particular report. They found that these huge, billion dollar, hundred and ten billion dollars that Trump quotes, may create perhaps a few hundred jobs, maybe a thousand. Well, what is Trump boasting about then? Well, let’s get to the bottom of this with filmmaker and author Andrew Feinstein. His film, Shadow World, is based on his book and Feinstein is a former ANC member of Parliament from South Africa. But his political career abruptly came to an end when he insisted on exposing a 10 billion dollar arms deal with BAE Systems, that’s British, BAE Systems and President Mbeki of South Africa to buy fighter planes for South Africa that they didn’t actually need.

Well, welcome Andrew. All right Andrew, let’s take up the Reuters report for us. What does it expose about the Saudi arms deals and the promised jobs that Trump is talking about.

ANDREW FEINSTEIN: As usual, what we’re seeing here is two things interacting. The first is the reality that throughout the world, defense contractors make these grandiose estimates of the number of jobs that arms deals are going to result in. And what I found through researching the global arms trade for almost 17 years now, what they reflect in the Shadow World, the book on the global arms trade is that these estimates are always way, way above the actual jobs produced. To give you an example, BAE Systems, the British company, when trying to get the Serious Fraud Office in the UK to close down a massive corruption investigation into BAE, said if the investigation continues, the Saudis won’t buy our typhoon jets and that’ll cost 55,000 jobs in the UK. Turned out, there were actually less than 7,000 jobs in the UK that would have been created by this deal.

Now, if we take that almost instinctive practice of the weapons makers around the world and we add to that President Trump’s usual dissonance with reality, you get some sense of where these absurd figures that he comes up with are coming from. So he’s saying anywhere between 450,000 and a million jobs from this deal. First of all, the deal in size, is nothing like the figures he’s talking about. He bandies around the figure of a deal of 110 billion. Then elsewhere, he talks about 450 billion dollars. The reality is the arms deal, most experts agree, will be between about 15 and 22 billion dollars. But in addition to that, most elements of this deal were actually negotiated under President Obama and even parts of it under President George W. Bush.

So what President Trump has brought to the table is virtually nothing new. But if we take that more realistic estimate of the size of the deal, you’re also going to get nothing near the sorts of job figures he’s talking about. In fact, what the Reuters report reflects is that Lockheed Martin, which would be the main contractor on the Saudi deal, would only add a thousand new jobs if this entire deal went through. It would, it should be mentioned, keep about 18 thousand people who are already in jobs, it would keep them busy as well. And if one thinks about the fact that economic think tanks argue that a deal of this sort will likely have a jobs multiplier effect of around three point two times, even if we combine the direct and indirect jobs of this deal, we’re talking in the 60 thousands rather than in the half a million type figures.

SHARMINI PERIES: All right, Andrew. These job numbers that Trump is talking about is really critical at this moment, given that we’re leading into, next Tuesday, a midterm election in the United States and jobs and economy is a big part of it. Now, give us a sense of who will actually benefit from these, if they are multibillion dollar contracts, and which pockets will be stuffed with the money that they may gain.

ANDREW FEINSTEIN: Well, this is not what President Trump would want the American people to hear. So point one, leading into the midterms Trump had very little, if anything, to do with any of these deals and even the small numbers of jobs that are being generated. So who will benefit? Well, as always, the defense companies; Lockheed Martin, Northrop Grumman, Boeing, et cetera, et cetera, et cetera, Raytheon, who are producing a lot of the missiles and other ordnances being rained down on innocent Yemeni civilians, will be the primary beneficiaries of this contract. And if these defense contractors benefit, guess who else benefits? The politicians. Because these companies are huge contributors to the campaign of those people on Capitol Hill who support the defense contractors.

So it’s this circle of money that will circulate from the Saudis, through the defense contractors in the United States of America, and some of it will end up in the hands of political representatives who, in turn, will ensure that Congress votes more weapons projects to the very same companies who are giving them campaign contributions. In addition to that, we should bear in mind that the other biggest beneficiary will be Saudi Arabia. It’s estimated that the Saudis will probably create around 10,000 jobs in Saudi Arabia itself on the back of these deals. But more than that, they will be provided with weaponry; helicopters, tanks, ships, missiles, radars, software that they will use to continue to slaughter innocent civilians quite intentionally on the ground in Yemen.

So the real beneficiaries of this deal, which is nothing like the size that president Trump claims it’s going to be, are the American defense companies, the weapons makers, American politicians and the Saudi royal family. And as always, the losers will be the American tax payer who subsidizes the weapons makers in America and the tens of thousands of innocent civilians, in countries like Yemen, who are suffering the consequences of these American weapons being used by the Saudi-led coalition against them.

SHARMINI PERIES: All right, Andrew. And the obvious elephant in the room here is why is Saudi Arabia, and of course the United States, why is it supporting Saudi Arabia in bombarding Yemen in this way? It’s perhaps one of the smallest and the poorest countries in the world. What do they have to gain from this effort in Yemen?

ANDREW FEINSTEIN: I think that the intention of Saudi Arabia, by waging what is effectively a war on Yemen, they’re intending to take control of the country. And their reason for taking control of a country as poor and, you could argue, as insignificant as Yemen is twofold. The ultimate endgame here is supremacy in the Middle East. And that supremacy is in alliance with America and in alliance with Israel. And how does Yemen feature into that intention of supremacy? There’s a crucial dimension to it, and that is the real objective of the Saudis and the Israelis and, I would argue, the neoconservatives in the United States, is regime change in Iran.

And because of the location of Yemen and the relationship of some of those who the Saudis are opposing in Yemen, their interactions and relationships with Iran, the idea is that a Yemen controlled by Saudi Arabia could effectively be used as a launching pad for an attack on Iran. And in my opinion, that is the Saudi and the Israeli and the American intention in the Middle East, of which Yemen is just one small piece of the puzzle.

SHARMINI PERIES: All right, Andrew. I thank you so much for joining us today and presenting such a clear picture of what is going on in terms of these jobs, as well as the Saudi’s role in the region. I thank you so much.

ANDREW FEINSTEIN: Thank you.

SHARMINI PERIES: And thank you for joining us here on The Real News Network.