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In addition

ly unused lending authority in the Central

done without threatening U.S. air superiori-

European Defense Loan fund, and the long

ty. The GAO estimates that with modest

to providing

history of bad loans for foreign arms sales all

upgrades, current-generation F-15s are more

grants and subsi-

suggest that the U.S. government should

than adequate to defeat any likely U.S. adver-

dized loans to

sary until at least 2014.21 Keeping existing air-

eliminate its exposure in arms export lend-

ing. U.S. taxpayers should ask why arms deal-

craft in the inventory instead of retiring them

U.S. weapons-

ers and foreign nations are being subsidized

prematurely would allow the Pentagon to

exporting firms,

to conduct arms transfers, some of which

slow down or cancel manufacture of the cost-

the Pentagon and

could cause regional conflicts or instability.

ly F-22 and F/A-18E/F fighters and concen-

In the interests of a sound foreign policy and

trate its resources on the next-generation

the State and

a sound fiscal policy, the era of "creative

Joint Strike Fighter. That approach could

Commerce

financing" and back-door, off-budget sup-

save tens of billions of dollars and would also

port for arms exports should be brought to

slow the pace of conventional weapons pro-

Departments pro-

an end.

liferation by reducing the stockpile of com-

vide extensive

bat fighters the Pentagon has for the world

Surplus and Leasing--The Pentagon's Weapons

marketing assis-

Giveaway Programs. In addition to financing

market.

arms exports through grants and loans, the

During FY97, under its Excess Defense

tance to those

Pentagon has also been leasing or giving away

Articles program, the Pentagon gave away

companies.

massive quantities of highly capable U.S.

military equipment with an original acquisi-

weapons that have been declared "surplus"

tion value of $973 million. Those giveaways

relative to current needs. According to a path-

went to 24 countries. The recipients of the

breaking report in 1996 by the Arms Sales

largest giveaways were Turkey ($271 million),

Monitoring Project of the Federation of

Jordan ($183 million), Greece ($100 million),

American Scientists, from 1990 to 1995 the

Morocco ($91 million), Israel ($68 million),

United States gave away (or sold at a steep

and Argentina ($66 million). Even allowing

discount) weaponry that had originally been

for depreciation, the Pentagon estimates the

purchased by the U.S. government for a total

current value of those weapons at $309 mil-

of $8.7 billion. Not only are those items being

lion. Given the Pentagon's well-documented

dumped on the market at much less than

history of underestimating the current value

their actual value, but, as the report states,

of surplus weapons, the true figure could be

"the services appear to be giving away still

25 to 50 percent higher. In addition to those

useful equipment to justify procurement of

grants of surplus weapons, the Pentagon sold

new weaponry." As a result, taxpayers end up

14 nations over $526 million worth of sur-

paying twice: once for forgone proceeds from

plus weapons at a steep discount (at prices

the sale to foreign nations of the still-useful

averaging 85 percent lower than the original

equipment and a second time for the pur-

acquisition value of the weapons). The recip-

chase of even costlier replacement items. For

ient of most of those discounted weapons

example, the Air Force and the Navy are buy-

was wealthy Australia, which received

ing expensive new fighter aircraft (the F-22

weapons originally worth $483 million for

and the F-18E/F, respectively) to counter the

roughly one-tenth of their original price.22

proliferation of advanced fighter aircraft

Another way the Pentagon unloads sur-

such as the U.S.-built F-15, F-16, and earlier

plus U.S. weaponry is through leasing

model F-18, some of which the armed ser-

arrangements. In FY97 the Pentagon leased

vices are now in the process of giving away as

to 13 countries equipment with an original

surplus.20

acquisition value of over $103.4 million. The

recipient of most of that weaponry was

A cheaper and smarter alternative would

Turkey, which received equipment originally

be to keep planes like the F-15, the F-16, and

valued at over $54 million for a rental price

the current model of the F-18 in service for

of $19.9 million.23

another decade or so, which could easily be

8