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Thursday, March 18, 2021

The Dangerous Global Marketplace for Conventional Weapons

Vital Interests: Trevor, thanks very much for joining us today on the Vital Interests Forum. We've heard a lot in recent weeks about the five-year reset of the START II Treaty between the United States and Russia limiting the number of strategic nuclear weapons and reducing ICBMs. However, there is another weapons proliferation reality which receives little attention - the international marketplace where countries compete to sell their latest combat aircraft, naval vessels, missiles, tanks, and artillery. To start our conversation can you put into historical context how this came about?

Trevor Thrall: This is a story that really begins with World War II. Before then there was some international arms trade that was largely unregulated but so limited that it never really became an issue in world politics or on anyone’s radar. Throughout World War Two, of course, the United States became the arsenal of democracy and cranked out tons of weapon systems of all kinds to send to the allies in Europe and elsewhere.

Those were crucial, of course, in helping to win the war for the Allies. The Lend-Lease Act of that era was one of the key mechanisms by which the United States transferred arms at low cost, no cost, or pay us later, because these weapons were urgently needed, the Nazis are coming. 

At the end of WWII, the U.S, emerged in a dominant economic situation generally, but more specifically with respect to weapons sales. The ensuing tensions of the Cold War certainly enhanced that position.

The United States begins, for the first time, to regulate the sale of weapons, with an eye toward national security considerations. Also factored into government policies toward arms sales was the good of American corporations, even back then there were a few major ones who benefited a lot from selling weapons. So there has always been that kind of interplay between economics and national security. For the most part during the Cold War, the United States looked at selling weapons, sometimes just transferring weapons, to specific countries as part of strategic policy.

It was mostly about fighting the communists during the Cold War. We sent a lot of weapons all over the world in an effort to shore up the people we thought were the good guys against various and sundry communist governments, communist insurgencies, around the world. In the late 1960s and early '70s, Congress and the President got into some tussling about how foreign arms sales should be regulated. As a result, a more modern regulatory framework of arms sales was created and that's more or less what we have today.

VI: President Eisenhower’s farewell address warned about the dangerous influence of what he termed the military-industrial complex. Was this in reaction to the influence large defense contractors had in pushing a foreign policy that included support for increasing international arms sales?

Trevor Thrall: Yes, absolutely. I'm sure most of your readers will be familiar with the famous saying that, 'What's good for General Motors is good for America.' I think in U.S. foreign policy, not just in weapon sales, but in general in the '50s and '60s, there's a lot of questionable diplomacy that the US government perpetrated on behalf of corporate America to get favorable prices for goods and access to markets.

For sure, there's a lot of money in the sale of weapons, especially expensive major weapon systems, and so corporate manufacturers of weapons have always rigorously lobbied the government for less restrictive rules about to whom they can sell and what they can sell.

Since 2002 onwards, the United States has sold weapons to 167 of the countries on planet earth. Almost all of them that we were not in direct conflict with.

VI: The figure today is that the United States accounts for about one third of all global arms sales?

Trevor Thrall: According to the Stockholm International Peace Research Institute (SIPRI) which keeps the closest track of this, the U.S. market share of global arms sales is about 36%, which is as high as it's been in the recent future. It's been creeping upward for the last 15 years or so. This can be partly attributed to the collapse of the Soviet Union which had been a big producer and exporter of weapons. Russia continues to be a significant arms seller but has slipped recently with China now aggressively entering the global arms market.

According to the State Department, in 2020 U.S. export sales of major conventional weapons and then smaller light arm weapons were about $175 billion.

VI: How do these weapons sales shape the relationship of the United States to the rest of the world?

Trevor Thrall: It's interesting because I think when you look at the pattern of American weapons sales, I think what jumps off the page is it reflects how the US sees the world and its role in it. Let's just take since 9/11. Since 2002 onwards, the United States has sold weapons to 167 of the countries on planet earth. Almost all of them that we were not in direct conflict with. 

That's a staggering figure to me. What it tells you is, partly, is that the United States understands that this is an economic game, and it's good for American companies to sell weapons. But another big part of it is that the United States views arms sales and arms transfers as a key tool of foreign policy, and it's always had a mix of rationales. 

There's a lot of money in the sale of weapons, especially expensive major weapon systems, and so corporate manufacturers of weapons have always rigorously lobbied the government for less restrictive rules about to whom they can sell and what they can sell.

The first one is, going all the way back to World War II, to strengthen allies. The most obvious reason you sell weapons to a country is because they have a bad guy next door or nearby that they would rather not get invaded by, and so you send them stuff to beef up their forces. It's cheaper and less risky than sending American troops, so it's better to send weapons. It is more flexible than signing a treaty or some promise to help. The government can just do this as a one-off, you can turn it up, or we can turn it down.

Presidents can also authorize arms sales without asking for permission, they don't have to tell the public, they don't have to have a big conversation about it. It's a very flexible tool for presidents. When you see U.S. arms going to 167 countries, it's not just allies, it's pretty much everybody. It's not just countries which are part of an official alliance like NATO, or even major non-NATO allies, it's countries that we think are important in various regional stability equations.

The United States thinks it has a lot of leverage, and can get a lot of leverage, through arm sales. So, the second big reason for arm sales is this notion that regardless of whether or not we are strengthening another country's military forces, which presumably we are when we send weapons, what we're also doing is we're sending messages. We're sending messages that the United States cares about what goes on in this region, what happens to this country, that we have their back. A lot of people believe that that helps provide mutual stability in various hotspots around the globe. A lot of people believe it gives us leverage over the behavior, especially the foreign policy behavior, of the countries we sell weapons to.

The U.S. market share of global arms sales is about 36%, which is as high as it's been in the recent future... In 2020 U.S. export sales of major conventional weapons and then smaller light arm weapons were about $175 billion.

VI: Can’t it also create a lot of international tension. For example, United States arms sales to Taiwan.

Trevor Thrall: Absolutely. I don't happen to believe that we get nearly as much from arms sales as people have long assumed. Most of my recent work has been around that theme of challenging the easy, conventional wisdom, that these things are true, because I just don't think when you look hard at most of these individual cases of arms sales you see much benefit to the United States. The case of Saudi Arabia, for example, is obviously a very timely example. We've sold more weapons to Saudi Arabia than to any other country for years. If one of the two main reasons that you sell weapons is to get leverage over another country's foreign policy, I have yet to see the leverage. I think there are real questions that need to be asked about the efficacy of this strategy. Again, U.S. arms sales policy has many decades of inertia, so it's going to be hard to challenge it.

VI: In addition to leverage, don't arms sales also support the notion of proxy war? You build up Saudi Arabia because what you're trying to actually do is challenge the expansion of Iran’s influence in the Middle East. The disastrous war in Yemen is a harsh example of this where you have Iran supporting the Houthi rebels and then the Saudis providing military support to the other faction.

The United States views arms sales and arms transfers as a key tool of foreign policy, and it's always had a mix of rationales.

Trevor Thrall: One of the oldest rationales for U.S. arms transfers has been to help the rebels, the moderate rebels, or the anti-communist rebels, or whatever their name is in the country that you happen to live in. There's a good side that the US likes and a not so good side that needs to be suppressed. A very standard US strategy for decades has been to arm the side that we like better. The idea is that A, that helps that side win but B, then eventually gives you leverage over what happens next in that equation.

Again, I think Yemen is a good example. Mostly what it does is causes a bigger mess. It's like pouring gas on a fire. You can't really control the fire and it burns a lot of stuff to the ground. It's not so easy to see where the original good intention was.

VI: This goes back to the George Kennan policy of containment of global communism? You could look at the Korean and Vietnam wars in that context?

Trevor Thrall: Absolutely. It's very similar. They're a lot alike.

Presidents can also authorize arms sales without asking for permission, they don't have to tell the public, they don't have to have a big conversation about it. It's a very flexible tool for presidents.

VI:  Now in 2021, does the United States have as much leverage as it used to with weapon sales? In the international arms marketplace, there's lots of competition. Sophisticated weapon systems are being offered by allies like Germany, France, UK, and Italy as well as by adversaries like Russia and China. How does that impact the role of the United States?

Trevor Thrall: That's a good question, and it's a complicated one to think through because there are a lot of cases and specific issues involved. There's probably not a single blanket answer to that sort of conundrum. For me, the starting point is that a lot of people worry about the US selling fewer weapons abroad because of the concern that we'll lose leverage. I flip that around. To me I don't really see very much leverage created by selling weapons. For me, the idea that we're losing leverage because Turkey buys some air defense stuff from Russia - I just couldn't care less. 

I don't see much leverage being exerted over Turkey through our weapons sales right now. First of all, there is really not that much to lose. Second of all, I think sometimes when people talk about arms sales, they act as if selling a country weapons is somehow the only form of leverage the United States has over other countries or by any means the biggest, it is not. The United States’s number one form of leverage is its economy, not its weapons.

The United States thinks it has a lot of leverage, and can get a lot of leverage, through arm sales... We're sending messages that the United States cares about what goes on in this region, what happens to this country, that we have their back. A lot of people believe that that helps provide mutual stability in various hotspots around the globe.

Now, if there is some country in dire straits where the only thing it cares about is getting weapons right now, yes, of course, there can be a situation where leverage enters the picture. But that is not generally the situation. Turkey is not in that situation. What Turkey cares much more about is EU membership. They care much more about their NATO membership. That is the leverage that the United States and Europe has over Turkey. A couple of weapons here or there simply don't make a difference.

The second thing I would point out about this is I think that the globalization of the weapons market represents an opportunity if you look at it from this other perspective. Another thing I think the United States loses when it relies so heavily on weapon sales is it loses the possibility to gain diplomatic leverage. The case of Taiwan in particular, it's interesting to me because the United States I think has supported Taiwan for a long time through weapon sales and it makes China angry every single time.

What if you asked, why does it have to be U.S. weapons Taiwan is buying? Sure, they have a right to defend themselves, but they don't have a right to American weapons. What if they bought jets from Sweden? What if they bought automatic weapons or tanks from some other country that China isn't so worried about? Then you take that destabilizing component out, and when Taiwan and China have a dispute, a more neutral United States could potentially have a more positive role in the region, than I think it's going to be moving forward with the current level of arms sales to Taiwan.

The case of Saudi Arabia, for example, is obviously a very timely example. We've sold more weapons to Saudi Arabia than to any other country for years. If one of the two main reasons that you sell weapons is to get leverage over another country's foreign policy, I have yet to see the leverage.

The same thing would be true in the Middle East. Take Israel and the Palestinians. The United States is not seen as a neutral diplomatic player in that conversation, hasn't been maybe ever, in part because we shower weapons on the Israelis like nobody's business. Now, I'm not trying to take a position on this, but it's pretty clear that's not the way to be a neutral diplomatic broker. Selling weapons to people creates entanglements. It takes sides, and I think the United States has the potential to be an incredible broker of peace but only if it gets out of the game of fueling war.

VI: Trevor, let's step back a little bit and talk about the process in the United States that approves arms sales. Are arms transfers to select countries treated differently from arms sales? There seems to be various mechanisms for approval - there is the Export Control Act, the State Department Bureau of Arms Control, Verification and Compliance, and the U.S. Conventional Arms Transfer Policy called CAP. Recently because of the Yemeni situation, there has been a congressional effort to impose human rights standards on arms sales with a proposed bill called the Enhanced Human Rights and Arms Sales Act. Can you walk us through what kind of controls there actually are on foreign weapons sales? 

Trevor Thrall: Your list could be even more complete, even more complicated. I wouldn't even try to do the entire thing. But in a nutshell, there are a couple of things that anybody who wants to understand a little bit more about those games should know. The first is that there's a whole class of weapons the United States won't sell to anyone like nuclear weapons. And anything that has to do with nuclear weapons is off the table for selling - fancy computers, high tech equipment used in nuclear engineering. That kind of stuff you simply can't sell. 

A very standard US strategy for decades has been to arm the side that we like better... Mostly what it does is causes a bigger mess. It's like pouring gas on a fire.

But of the things that we do sell, there are two lists. One is the foreign military sales list (FMS), and that covers major conventional weapons, so planes, tanks, ships, big bombs, things like that. Then there's the DCS-list - the direct commercial sales list - that has been approved for general sale. The FMS list of big-ticket weapons has to get approved by the State Department and blessed and then can be notified to Congress that the US intends to sell it now.

Then the commercial list is all the stuff that's been approved for sale without government oversight. This includes a whole bunch of stuff that is actually quite deadly like automatic weapons, handguns, grenades, or crowd control equipment. These are actually the types of arms that cause most of the deaths in the world. That stuff, people can sell as long as the customer isn't on a bad guy list somewhere (meaning they’ve already been caught using weapons for ill intent before or there is a criminal connection).

I think sometimes when people talk about arms sales, they act as if selling a country weapons is somehow the only form of leverage the United States has over other countries or by any means the biggest, it is not. The United States’s number one form of leverage is its economy, not its weapons.

VI: You're talking about weapons and equipment in the FMS category that are going not just to the military, but also law enforcement or some kind of government control agency - SWAT vehicles. rubber bullets, tear gas etc.? 

Trevor Thrall: Yes certainly to police and domestic security forces. And even stuff like handguns that could be sold to individual citizens. A company or country will make a request, and if it's a request for something on the FMS list, the State Department will go through a sort of risk assessment exercise to make sure that it won't cause problems and that step is required by the Arms Export Control Act of 1976. What that does is it requires the United States not to sell weapons where it might cause an arms race, or create human rights violations, or a few other bad things.

Historically, though, very few (really almost no) arms sales ever get held up by that review. That's a little bit of a concern I have with the process. But there is a review, and then once that review is completed, the State Department will send out a notification to Congress. Congress, when it wrote the Export Control Act, gave itself the ability to stop any sale, if Congress voted to override the sale within 30 days of being notified about it.

Now, given what we know about Congress, the idea that they're going to stop in the middle of a busy schedule for such a review, is really ludicrous. You can guess exactly how many times that has been exercised.

VI: I imagine very few times.

Another thing I think the United States loses when it relies so heavily on weapon sales is it loses the possibility to gain diplomatic leverage.

Trevor Thrall: Actually, zero times. They've never managed to vote down any proposed sale. They've threatened a couple of times and managed to get the shape of a deal changed once under the Reagan administration on yet another weapons sale to the Saudis. Then more recently, they were trying it again, with Yemen, but didn't quite manage it. Although at least they finally did pass a bill that Trump had to veto, so that was close.

Once the notification time window has passed, then it's okay for the government to have those weapons delivered and that could happen anytime, up to years later. A lot of these take many, many years to happen if you buy a bunch of F-35s or ships with long manufacturing lead times. Many of these complex weapons, in fact, will never be delivered. One of the interesting things is that there is a big-time melt factor in these numbers.

Selling weapons to people creates entanglements. It takes sides, and I think the United States has the potential to be an incredible broker of peace but only if it gets out of the game of fueling war.

The United States notified Congress of $87 billion dollars worth of FMS sales in 2020, for example, but it's very likely that only half of those weapon deals will be finalized at the originally committed levels. When the weapons are delivered, there are a couple of efforts that the United States makes to check up, to make sure that the weapons got where they were supposed to go and they're in the crates in the warehouses where they were supposed to be. However, these programs are pretty rudimentary and not really what you call would call oversight – nothing that you could expect to prevent the misuse of those weapons down the road.

Interestingly, under the Trump administration, the State Department folks who helped write the updated conventional arms transfer policy more or less kept the policy the same from the Obama administration and Obama hadn't changed it very much from the Bush administration. They did add one little interesting note, which was to add a clause about assessing the probability and reducing the risk of civilian casualties caused by the transfer of weapons.

If it's a request for something on the FMS list, the State Department will go through a sort of risk assessment exercise to make sure that it won't cause problems and that step is required by the Arms Export Control Act of 1976. What that does is it requires the United States not to sell weapons where it might cause an arms race, or create human rights violations, or a few other bad things.

That's an interesting issue because as you can imagine, if you sell weapons to a country that's in the middle of dealing with a terrorist insurgency or civil war, or border conflicts, or dealing with rebellions, the chances for these weapons to be misused by the government or their forces to kill civilians, it's pretty high. The State Department took some steps to try to figure out how you might mitigate those things and so they added some efforts to scrutinize customers for their capability to correctly handle these weapons.

For example, you might ask a country whether their forces have had training on the norms of law, of war, whether their pilots are trained on how to avoid bombing of civilian targets and mitigate collateral damage.

Have you done the training? If not, the idea is to impose some training requirements before they get delivery of the weapons. The push for this kind of oversight came up several years ago, and it's still working its way through the system. In theory, if you sell weapons, you have the leverage, at least before someone gets them, to make them go through some hoops. It is possible that there will be an uptick in that kind of effort moving forward. I would think the Biden administration might be more in favor of that than the Trump administration. We'll see.

Given what we know about Congress, the idea that they're going to stop in the middle of a busy schedule for such a review, is really ludicrous. You can guess exactly how many times that has been exercised... They've never managed to vote down any proposed sale.

VI: What is the position of the United States on the 2014 UN Arms Trade Treaty (ATT) which attempts to prohibit weapons sale to countries that engage in genocide, crimes against humanity, war crimes? It is often the attitude of the United States to resist any kind of outside regulation.

Trevor Thrall: What's interesting about the ATT is that it was mostly just a codification of what was already law in the United States. We already had the Leahy Law that prevents delivery of weapons to any military unit against whom there were credible reports - not proven, but credible - reports, of human rights violations or abuses.

We can have a whole session about holes in the Leahy Law, but as political theater, it's quite good. It says what you want it to say: that we're not giving weapons to bad guys. Unfortunately, they may be targeting bad guys too much because you can still sell to a particular country, you just are not going to sell to one individual military unit suspected of engaging in abuses.

If you sell weapons to a country that's in the middle of dealing with a terrorist insurgency or civil war, or border conflicts, or dealing with rebellions, the chances for these weapons to be misused by the government or their forces to kill civilians, it's pretty high.

The ATT really just tried to get everyone else to abide by what were essentially best in class rules of due process and concern for these outcomes. There was no reason the United States shouldn't have signed it and ratified it immediately because we weren't signing on to do much differently than what we already did. But predictably, those topics are pretty polarizing in Congress. Republicans were never interested in it, while Democrats were very interested in it. So it wasn't very surprising when Trump sort of unassigned the essence name to the ATT. I won't be surprised if Biden re-signs it. I think that's actually a very fair description of where the US is on these things. We are divided.

VI: You mention that there are supposed to be risk assessments on weapons sales by Congress but you have also been instrumental in producing a comprehensive report called the Arms Sales Risk Index. Can you give us the highlights from your report?

Trevor Thrall: To date I have focused mostly on post 9/11 arms sales, when there was a surge of sales to countries that you might imagine were pretty risky, as defined by the chances of things going wrong, given the weapons that you sold them. The thing I was horrified to realize is that, okay, it's one thing to sell weapons or give weapons to Iraq and Afghanistan, where you know the risks are very high, but you believe at least in the urgency of the situation and the interest to United States security.

But there are tens of billions of dollars in sales to countries where that urgency and justification does not exist but where the risks are equally high. Selling serious weapons to countries that don't matter very much to the United States but are risky, that's where I really don't see much reason to sell weapons - places like Nigeria or UAE would be good examples. I mean, countries that are involved in doing things that we don't like, who don't need the stuff to be secure themselves. I don't really see why we want to be part of what they're doing with these arms.

The first step is not be part of the problem, then you can help put pressure and be part of a solution in volatile situations.

Now, again, is it going to stop them from buying the weapons from someone else and then doing terrible things? No, but again, you cannot be a credible diplomatic intervener in those situations, or encourage them to stop while you are giving them the guns. The first step is not be part of the problem, then you can help put pressure and be part of a solution in volatile situations.

VI: Do you think more effective congressional oversight is needed? Would the kind of bills that are being put forward more directly tying human rights to arm sales make a difference?

Trevor Thrall: I think without a paradigm shift in Washington, D.C. more broadly, there's no chance that legislation will be written that has the kind of teeth that I would be looking for. My presumption is that we should say no to countries asking for weapons unless they can pass a certain bar, and right now it's the opposite. Unless you can come up with a really good reason not to, that everyone agrees with, you're going to say yes - I would flip that around.

I don't see that happening. Could things get tightened up a little bit? I guess so. I'm not sure that even the Enhanced Human Rights and Arm Sales Act that is coming is going to stop some of the things that you might think it would, like sales to Egypt, or the UAE, or Turkey. I don't think it's going to stop any of those folks from getting stuff, even though I think most of those countries have proven they probably shouldn't be getting these things. I think, unfortunately, it's a little bit more political theater than it is reality. I think ending support for Saudi Arabia’s war in Yemen at the presidential level is more important than any arms sales legislation.

VI: One department you don't hear much about in the arm sales debate is the Department of Defense.  DoD certainly does threat assessments of situations all around the world and knows where the sale of potent weapons would be problematic. Is the Department of Defense too much a part of the military-industrial complex to be a neutral player in the arms sales process?

Trevor Thrall: I don't actually think that that's the main issue. It really is the State Department that manages the process. However, at the end of the day it is the White House that has the main say. It is an executive decision on who gets American arms.

The fact is that arm sales are just such an easy and popular tool for presidents.

The fact is that arm sales are just such an easy and popular tool for presidents. They can build relationships by using arm sales. You saw Trump do that. You can travel the world, you can promise people goodies, you can build that relationship. It's a nice carrot to have for a president. The interesting thing about that is, of course, the president doesn't pay any of the negative costs. All the positives happen right away, the negatives happen potentially decades later. 

I would say that if you asked the career folks at DoD and the Department of State, and I've talked to many of them, many of them are far more cautious and believe we do much more wasting of U.S. aid on the defense and security side than most people would assume.

VI: Certainly the Pentagon is concerned with U.S weapons falling into the wrong hands.

Trevor Thrall: Absolutely. In every military conflict the United States has fought in the last decades, we have wound up fighting someone who is using American weapons. ISIS stole almost a division's worth of American equipment from the Iraqi army. 

In every military conflict the United States has fought in the last decades, we have wound up fighting someone who is using American weapons. ISIS stole almost a division's worth of American equipment from the Iraqi army.

VI: In Afghanistan, one of the great advantages the American forces had was night scopes and night vision goggles. Within a year the Taliban had them as well.

Trevor Thrall: Where there's a dollar to be made, there will be somebody trying to figure out how to sell it to you. There is a very robust black market all around the world for American weapons, I mean all weapons, but certainly American weapons because they're usually the best. That's another reason why we should think twice about some of these customers that we sell to especially in places where the economy is not strong, where there's a lot of corruption. These are really two big indicators of potential trouble because it's going to look really tempting to sell American weapons onto the black market. 

VI: Trump had a transactional attitude towards arms sales - "The United States will sell expensive weapons systems to Saudi Arabia - look at the billions of dollars we're making. It's creating American jobs." Is that a justifiable argument? Do foreign arms sales subsidize the American defense program? Are global arms sales basically a beneficial cost-benefit analysis decision?

Trevor Thrall: I guess that depends on where you sit. The bottom line is that if you talk to major defense contractors, it's money. Absolutely. Plain and simple. For the United States as a whole, for most things like tanks, ships, or planes, the United States military is by far the biggest customer. The per-unit cost savings you're going to get from most of these things by selling a few to here or there is not going to be huge. That is the number one reality - to let that then shape your foreign policy would be a tail wagging the dog situation. 

The second thing is that the benefit does go to the companies. The United States does not make money from these sales, the companies make money from foreign arms sales. It's not lining any president’s pockets. It's not fun money for the president to spend, it's fun money for General Dynamics, Lockheed Martin, and Northrop Grumman to spend. 

Yes, defense industries do employ a lot of people that are a non-trivial portion of our economy, but when you talk to economists about whether that is a productive way to invest in an economy, the answer is most often, "No, it's not." We would create far more jobs spending $10 billion, instead of on the defense budget which gets trickled out to these guys, allocate it to the healthcare sector or on infrastructure projects. All those things create more knock-on positive effects for the American economy than defense spending does. The idea that you would make an economic argument for foreign arms sales is really specious. It's one thing to say we should have a big defense budget and spend it on our own stuff because that's good for our security and subsequently benefits our economy. But to argue that selling American arms to other countries is going to somehow add significantly to the U.S. economy does not justify aggressively pushing for foreign weapons sales. 

VI: Can we look at some outliers in the arms sales arena. Private military contractors (PMC) have been in the news recently with Erik Prince (of Blackwater fame), being involved with a well-armed private military force in the conflict in Libya. PMCs are large entities operating not just from the United States, but also the UK, Australia, and South Africa. Russia operates the formidable Wagner Group. Are their activities a consideration in foreign arm sales? Or are PMCs unregulated security operations with their own sophisticated weaponry - attack aircraft, ships, armor, missiles etc.?

Defense industries do employ a lot of people that are a non-trivial portion of our economy, but when you talk to economists about whether that is a productive way to invest in an economy, the answer is most often, "No, it's not..." The idea that you would make an economic argument for foreign arms sales is really specious.

Trevor Thrall: That's a good question. They are not covered, as far as I am familiar, by the Arms Export Control Act because they're not selling weapons, they're selling services. You never see PMCs directly mentioned as being part of that so I'm going to guess the answer is that they're not yet covered under the various arms sales legislations. But their impact certainly suggests that they're something to think about, Again, like arms sales, the reason that they're popular is because they're so flexible, right? They are lower risk than sending regular troops, they're cheaper, and you can hide them from public scrutiny which is a lot of what attracts people to selling weapons.

I think they show a lot of the same downsides, which is, you think you control what's happening when you send them in, but you don't always. Sometimes they create more problems than they solve. I think just from a democratic accountability standpoint, I personally have a lot of concern with the idea that the United States will be using them because that's pretty tricky ethical ground.

VI: We're in the age of a new weaponry - DARPA (Defense Advanced Research Projects Agency) is busy developing next-tech weaponry. Very sophisticated drones are already part of the U.S. arsenal and other kinds of autonomous weapons will be coming online very soon. How do you think these weapons will be regulated so that their global proliferation is limited?

Trevor Thrall: Yes, they're going to get there. Until the Trump administration drone sales have been restricted by one of those lists that enumerate the stuff that we don't sell to anybody. There is something called the Missile Technology Control Regime and drones were prohibited from sale under that. It's not a treaty, so much, it's an informal agreement that was focused on nuclear proliferation issues.

As new technologies come online - drones, cruise missiles, and robotics, the question is, where do you put them? How do you categorize them? Do these weapons go on the naughty list or are these things put on the maybe list? The Trump administration had made moves to loosen up and start selling drones, but the Obama administration had also loosened up the rules by moving many weapons from the FMS list to the DCS list. I don't know where the Biden administration is on this. History suggests that what happens is the United States eventually will sell all these things to everyone because in large part because China will start selling drones. Russia will start doing drones. We'll just say, "Well, why not us?" I think the logic there needs a little work but that is what tends to happen. My guess is that you can expect almost anything we develop eventually to be on sale.

As new technologies come online - drones, cruise missiles, and robotics, the question is, where do you put them? How do you categorize them? Do these weapons go on the naughty list or are these things put on the maybe list?

VI: That brings us to my next question. We're also in the era of cyber warfare - there are all kinds of cyber tools, cyber weapons, and hacking programs that can be employed for destructive purposes. Are these also being sold in the global arms marketplace? 

Trevor Thrall: As far as I know, the United States does not sell cyber hacking tools to anyone right now. I don't know where the rules are now as to what exactly you can sell if you tried to. For sure that is another super international market where everybody has the ability, unfortunately, to create tools that do most of the bad things we can think of these days. I think the cat may have gotten out of the bag before any government really could do anything about it. That's going to be an interesting one to watch.

VI: The actors here are not the normal kind of defense contractors. I imagine Lockheed, Boeing, and Raytheon are all scrambling to get on top of this themselves?

Trevor Thrall: It seems, for the most part, many of the big companies in the United States are playing catch up to guys in Romania coming up with sneaky ways to do denial of service and other attacks on U.S. companies.

 Another thing in this realm that is of concern to some government folks I was talking with is the technology involved with surveillance, crowd control, and facial recognition. All of that stuff is getting sold, and probably needs some looking at as to whether that's okay because the people most interested in buying those things are the people who are going to misuse it in exactly the way that we don't want, like the way China uses it in Hong Kong and now the generals in Myanmar to suppress any dissent. This needs to be seriously examined and soon since new, and potentially harmful, capabilities are moving fast.

Another thing in this realm that is of concern to some government folks I was talking with is the technology involved with surveillance, crowd control, and facial recognition... The people who are going to misuse it in exactly the way that we don't want, like the way China uses it in Hong Kong and now the generals in Myanmar to suppress any dissent.

VI: Trevor, we're kind of coming to the end of our time. Thanks for this interesting discussion. To sum up, there is definitely a considerable proliferation in the global arms trade. There are some efforts at control and monitoring but not nearly enough. From your point of view, what will the next 5-10 years look like in this sphere?

Trevor Thrall: I think you're going to see intense competition globally. The US will continue to look at leadership in that market as a positive. I think China looks at it as an arena in which they want to compete with the United States. I think Russia uses arms sales as an effort to maintain global relevance vis a vis the United States and China. Putin will do everything he can to remain a big player and I think that creates a lot of dangerous dynamics for the world. We have seen over the last 20 years that the Middle East is what happens when you sell tens of billions of dollars of weapons to countries that have ongoing conflicts, that are nervous about their neighbors, and where there's a lot of extremism. It's a dangerous cocktail, and I think, unfortunately, we can expect a lot more instability in the future.

VI: Arms competition is not only coming from potential adversaries, but isn’t there also increased development of weapon systems by U.S. allies? Certainly in Europe there is an attitude that they can't really depend on the United States as they had in the past and the idea of a new European Defense Force is motivating increased defense spending.

Trevor Thrall: Yes, for sure. I think they face many of the same kind of arguments at home as we do here - it's good for France if we make our own, it's good for Sweden if we make our own, it’s good for Germany if we have a robust arms industry, and hey, look at Russia. We can't be too careful. I think there's no question that the Trump administration enhanced that dynamic within a lot of European capitals - that we're not going to be able to trust the United States anymore so we're going to have to do it ourselves.

 It's interesting because the competing thing in Europe is that there are a bunch of people in civil society organizations who are making a strenuous case for more restraint in arm sales, especially over sales to Saudi Arabia. That was a really big flashpoint in Europe. It'll be interesting to see which way Europe ends up tilting, but my bet at the moment is that the arms industries there will continue to grow.

 
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Trevor Thrall is an associate professor at George Mason University’s Schar School of Policy and Government where he teaches courses in international security and a senior fellow for Cato Institute’s Defense and Foreign Policy Department.

Thrall’s research includes work on shifting American attitudes toward foreign policy, the role of arms sales in U.S. foreign policy, and grand strategy. He created and now maintains the Arms Sales Risk Index at the Cato Institute. Most recently he is the co‐​author of Fuel to the Fire: How Trump Made America’s Broken Foreign Policy Even Worse (and How We Can Recover) (2019). He has also edited several books on U.S. foreign policy including, U.S. Grand Strategy in the 21st Century: The Case for Restraint (2018). 

Thrall holds a PhD in political science from M.I.T