Senate Foreign Relations Committee Report on the International Security Assistance and Arms Export Control Act of 1976 [Extracts], May 14, 19761

II. POLICY PROVISIONS

A. Grant Military Assistance Program

1. The bill requires a phaseout of the general foreign military grant assistance program by October 1, 1977, except for programs subsequently authorized on a country-by-country basis (Section 105).

2. U.S. military missions and similar groups abroad are to be terminated by October 1, 1977, unless continuation of a specific mission is subsequently authorized by law (Section 104).

3. Authorizations for military grant assistance, other than training assistance, are allocated on a country-by-country basis for all major recipients. Small additional amounts are authorized for countries for which individual ceilings are not specified (Section 101).

4. The President's authority to draw on Department of Defense stocks for military assistance purposes has been restricted to require a finding that such assistance is "vital" to U.S. security (Section 102).

5. It strengthens provisions of law on terminating grant military assistance and prohibiting credits or guarantees to or for any country which violates the provisions of military aid or sales agreements (Section 303).

6. It establishes an anti-discrimination policy applicable to the military grant aid and government sales programs and to export licenses (Section 302).

7. It establishes a human rights policy with provision for restricting or terminating security assistance to countries which engage in gross violations of human rights (Section 301).

8. It prohibits further military or related assistance to Angola except pursuant to specific authorization by law (Section 404).

B. Government Military Sales and Commercial Exports of Arms

1. Under the new Arms Export Control Act, which replaces the Foreign Military Sales Act, policy emphasis will be placed on public disclosure of arms sales matters and on bringing about restraint in the international trade in arms.

2. Statutory requirements for controls over commercial and government-by-government military exports are revised and combined in

1S. rept. 94-876, 94th Cong., 2d Sess., pp. 3-5, 8-14. For the Presidential veto message on the earlier version of this bill, see ante, pp. 288-291. For the House International Relations Committee report on the revised House bill, see infra. For the Conference report on the revised bills, not printed here, see H. rept. 94-1272, 94th Cong., 2d Sess., June 16, 1976. The act approved by the President, a substitute for both bills, is printed post, pp. 386-430.

a new Arms Export Control Act so that all military export matters are controlled under one statute (Sections 201, 212).

3. All sales of major defense equipment items totaling $25,000,000 or more must be made through government-to-government channels, except sales to members of NATO (Section 212).

4. Restrictions are imposed on sales to foreign governments from U.S. military stocks, with reports to Congress required on all sales which would impair U.S. combat readiness (Section 206).

5. The President is required to submit an annual country-by-country justification to Congress for the government-to-government military sales program (Section 209).

6. All government-to-government sales contracts are to be made available to the public to the fullest extent possible, consistent with U.S. national security (Section 205).

7. Reporting procedures for military sales and exports would be expanded and improved (Section 211).

8. Congress would be allowed to reject certain proposed export licenses for commercial sales (Section 211).

9. Reports would be required on all agreements to pay agents' fees, and data concerning fees actually paid, in connection with military sales abroad (government and commercial) (Section 604).

C. Miscellaneous Policy Provisions

1. U.S. personnel are prohibited from engaging in direct police arrest actions in foreign countries in connection with narcotics control efforts (Section 303).

2. Military grant assistance, credits, guarantees, and deliveries of such assistance, and supporting assistance to or for Chile are prohibited in 1976; in addition, government-to-government cash sales, commercial sales, and all deliveries of defense articles and services are prohibited in 1977 (Section 310).

3. The sense of the Congress is expressed in support of negotiations to limit military deployments in the Indian Ocean area (Section 407). 4. The sense of the Congress is expressed deploring armed strife in Lebanon and requesting that the President use his good offices to seek an end to the civil conflict (Section 410).

5. Modifies restrictions in existing law relating to stockpiles intended or earmarked for use by foreign countries (Section 103).

6. Prohibits security assistance, and most economic assistance to countries that deliver or receive nuclear reprocessing or related equipment unless they have agreed to multilateral safeguards, when available.

7. Authorizes funds for the implementation of newly enunciated U.S. policies toward southern Africa.

COMMITTEE COMMENTS

The present bill incorporates authorization for military and security assistance and related programs for the fiscal year 1976, the transition quarter and the fiscal year 1977 into a slightly modified version of the conference report of S. 2662, The International Security Assistance and Arms Export Control Act of 1976, as passed by both the House and Senate. Except as noted below the more important policy provi sions of this bill remain essentially those of S. 2662. In recommending the present bill to the Senate, the Committee reaffirms the following views stated with regard to S. 2662, contained in Senate Report 94-605, of January 30, 1976:

This bill, when enacted, will constitute the most significant piece of legislation in the field of foreign military assistance policy since the enactment of the Mutual Security Act more than a quarter of a century ago. For a number of years Congressional dissatisfaction with foreign military assistance and sales programs has been increasing, reflected in votes in both bodies. For the first time since the beginning of our post-World War II aid program, this Congress is treating foreign development assistance and military assistance in separate bills, a step long supported by the Foreign Relations Committee and the Senate. The end of the war in Indochina, the pursuit of a policy of detente toward the Soviet Union and steps toward normalization of relations with China, have brought about a general reappraisal of the traditional tools of America's post-war foreign policy. The tools of foreign policy must be geared to the needs of today and the future, not the past. This bill looks to the future. It will revise the statutory framework for all military exports-grants and sales-government and commercial.

Since World War II the emphasis of United States military assistance programs, born of the Cold War, has been on expediting the flow of our arms and ammunition to noncommunist nations around the world. Arms control considerations have been secondary. In the last three decades, the United States has given away or sold some $110 billion in military equipment and supplies to foreign countries. The bill approved by the committee, recognizing evolving United States security interests and the danger to world peace from runaway arms sales, shifts the policy emphasis from expanding arms exports to strengthening controls, especially Congressional controls.

The major purpose of S. 2662 is to bring about centralized and more effective control within the Executive Branch over, and a stronger voice for Congress in, United States arms exports, government and commercial. The Arms Control and Disarmament Act states that the policy of our nation is to seek "a world which is free from the scourge of war and the dangers and burdens of armaments . . ." This bill will help to put that policy into practice. Arms sales, for good or evil, have become a major tool of American foreign policy.

In the last fiscal year the United States Government sold $9.5 billion in military equipment, supplies or services to seventy-one nations. In addition, $602 million in military materials were supplied through commercial channels and $584 million given away in military grants.

This program was not the product of a careful and deliberate policy arrived at through joint action by Congress and the Executive Branch; it developed through its own momentum. The lack of a coherent policy on arms sales is not the fault of the Executive Branch alone. Congress bears a measure of the responsibility as well because of its failure to give more effective policy guidance and to exercise proper oversight on arms sales matters. S. 2662 will help to fill that vacuum.

The basic statutory framework for arms exports is outdated. Commercial sales, which now comprise only about five percent of all U.S. arms exports, are governed by one section of the old 1954 Mutual Security Act, a provi

For the text of S. 2662, see the Congressional Record (daily), Apr. 6, 1976 (vol. 122, no. 51), pp. H2952-2964.

'Documents on Disarmament, 1961, p. 482.

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sion devoid of policy guidance that gives complete discretion to the President. It is an anachronism of an era when Congress chose to leave major foreign policy matters to the President. The Foreign Military Sales Act, which controls government-to-government sales, is also a product of a bygone era. Although that Act was enacted less than a decade ago, experience has shown that this statute gave broad and sweeping powers to the Executive Branch. The 1975 government sales chart is vastly different in quantity and geography from that of 1968. Military sales by the U.S. government have increased more than ten-fold since then. At that time the bulk of United States arms sales was to our NATO allies. Today, the volatile Persian Gulf, not Europe, is the heart of the market. This bill will update, consolidate, and strengthen the statutory framework for the control of U.S. arms exports, both by the government and through commercial channels.

The Committee does not contend that the sale of arms to foreign countries is evil per se. The United States has important security and foreign policy interests in the sale of arms to many countries. The sale of F-16 aircraft or other weapons to our NATO allies clearly promotes important United States security and economic interests. But the massive influx of American arms to the Persian Gulf area, which is largely responsible for the great leap in U.S. arms sales totals, must be viewed in a different light. American interests vary from country to country and from case to case. This bill will not stop, nor necessarily curtail, arms sales. It contains neither prohibitions nor ceilings on sales. But enactment of S. 2662 will improve the scrutiny given to the foreign policy aspects of arms sales proposals, both within the Executive Branch and the Congress. Given due attention on the part of the Executive Branch to the concerns expressed by Congress over the lack of coherent policy review of arms sales, the enactment of the bill will not adversely affect American industry.

The bill recommended by the Committee is designed to achieve five basic objectives with regard to U.S. military assistance programs:

1. Shift the focus of U.S. arms sales policy from that of selling arms to controlling arms sales and exports;

2. To provide the Congress with additional information about, and expanded and strengthened control over, arms transfers;

3. To provide the public with more information about government arms sales actions;

4. To reduce significantly the number of military grant assistance programs and U.S. military missions abroad over the next year and a half and to require a specific authorization for any grant programs or missions after that, and

5. To reduce the cost of military assistance grants.

A major feature of the bill is to bring American arms exports issues out into the open. A basic fault of past policy, which has led to the present state of public concern, is that too much of the sales program in the past has been carried out in secrecy

Nothing is so essential to rebuilding confidence in governmental processes as public debate. To be accepted by the American people, arms export programs must stand up under the light of public scrutiny. Our defense budget is a matter of public record, insuring the availability of facts essential to public debate. The Committee believes that shining the public spotlight on arms sales will help to bring about a more rational, publicly acceptable policy. The Committee is aware of the concerns expressed by some business interests concerning the disclosure aspects of the bill and the feature to require sale through government channels of all major weapon systems or equipment valued at $25,000,000 or more. The Committee has taken those concerns into account in the shaping of this legislation and does not believe that this bill will impair the U.S. competitive position in foreign arms sales.

Control by both Congress and the Executive Branch over the sale of major weapons systems will be strengthened by requiring that all significant sales of major equipment can be made only on a government-to-government basis. The most significant control aspects of the bill are those which provide Congress with the tools and the information needed for improved oversight of arms export policies and programs.

This bill also sets a goal of drastically reducing both the number of countries which receive grant military assistance and the number of U.S. military missions abroad. Passage of S. 2662 will not mean that all grants and missions will end by October 1, 1977. But it will require that after the end of the next fiscal year all grant military aid, by country, and all U.S. military missions abroad must have been authorized specifically by the Congress. As a start in implementing that policy, this bill contains line item allocations for grant military aid and supporting assistance and it requires a significant reduction in the number and size of U.S. missions abroad.

For many years the Foreign Relations Committee has attempted to reduce the military aid program and bring it under more effective Congressional control. Last year the Senate voted to phase out the grant aid program but, because of the adamant opposition of the House, the mandatory feature was eliminated and a sense of the Congress provision substituted which stated that "except for training, the program should be reduced and terminated as rapidly as possible." In addition, the bill directed the President to submit to the first session of the 94th Congress a detailed plan for the reduction and eventual elimination of the present military assistance program. The President's compliance with this requirement was both belated and inadequate. This bill, therefore, will carry out that Congressional expression of policy.

We are now celebrating the bicentennial of our nation's birth. It is important that Congress reflect on what we as a people want America to stand for. The values and principles we live by as a nation will be what history will remember America for, not the sophistication or quantity of our weapons. The United States, as the leading actor, has a great capacity for leadership in the control of trade in conventional weapons. It is not sufficient to say that everyone else is selling arms. Surely we can do better than allow our policies in this field to be captive to the policies of others. And, as the number one salesman, the United States has a special leadership responsibility. Our nation's military assistance and sales statutes, with their conflicting potential for preserving peace and promoting war, need a thorough overhaul. This bill will accomplish that.

The bill described by the above passages represented the culmination of several months effort to meet objections which had been raised by the Executive Branch to S. 2662 in its original form. Countless days of work went into that effort. When the bill came to the Senate floor the Secretary of State noted in a letter to the Chairman of the Committee his appreciation for the consideration which the Committee had given to the Executive's views on the original legislation. He indicated, moreover, that the Executive Branch would "not delay Senate action by requesting further consideration of our remaining objectives in the floor debate."

During the conference with the House of Representatives, which had subsequently passed a similar bill, Committee Members resumed their efforts to meet the remaining objections raised by the Executive Branch. The conference report eventually reflected several additional modifications made with the views of the Executive in mind. At this point the senior representatives of the Departments of State and Defense with whom the Committee had been working indicated that while there were provisions of the bill which the would rather not see enacted, they felt that it was acceptable. The conference report was subsequently passed by solid votes in both houses. It was the view of many that the interest of a responsible foreign military sales program and continued progress toward peace in the Middle East made the prompt passage of this legislation mandatory.