17. America’s Shop Window
The Israeli arms industry plays a unique role in that it is a manufacturer as well as a large client and also acts as an intermediary for other countries, particularly the US. Ronen Bergman, an Israeli journalist with sources in the country’s intelligence community, describes Israel as the ‘long arm’ of the US in the Middle East and the ‘primary testing ground for American weapons and … combat tactics’.1 In effect, a shop window for the American weapons industry.
The Israeli defence industry is an impressive showcase. While the government has not released figures for the value of its arms exports in 2007 and 2008, the country did reveal that it signed arms contracts worth over $6.3bn in 2008, the seventh-highest of thirty-two countries for which there is information available.2 It was the eleventh-largest importer of arms between 2005 and 2010, when its imports rose 102 per cent.3 All of these figures are most likely much higher than the official information provided.
Large parts of the Israeli military budget, including the procurement figures, are classified, only ever seen by a small group of people who have the relevant security classification, so no one knows its true size. Israel spends 8 per cent of GDP on the military, to the US’s 4.5 per cent.4 Most countries spend around 1 per cent. In Israel defence spending is always the biggest budget item, even though it excludes the Shabak (Israel’s internal security service) and Mossad, whose budgets are entirely secret. In the 1980s, an economist, Tal Wolfzon, claimed that Israel wasn’t calculating the cost of defence correctly and that the country was spending 12.3 per cent of its GDP on defence, which would make it the largest per capita defence spender in the world.5
For the first two decades of Israeli statehood, what there was of an arms industry was in government hands, but it is now substantially privatized, with a few large companies still in state control or run jointly by the state and private interests. During these early years the country was primarily an importer with some limited production. 1967 saw the need for a domestic industry as a consequence of the occupation of Palestinian land and a French arms embargo. The occupation lacked international support, which encouraged greater self-sufficiency, especially in the production of weapons. From 1973 the US started to provide Israel with aid, mostly military, to the tune of $3bn annually.6
Israel set about the creation of a $3bn armaments industry. But internally focused production was extremely expensive and unable to meet the country’s defence needs in full. The most high-profile example of this failure was the Lavi jet fighter, which was eventually scrapped in 1987 because of its exorbitant cost. With the realization that it would not be able to sustain production entirely for its own use, the Israelis began to develop an industry for export, in order to fund its own war machine. By the late 1970s/early 1980s Israel was ranked between eighth and tenth among exporters, with massive sales to Central and South American military regimes, the Shah’s Iran and South Africa. The industry declined in the 1980s due to the Reagan administration’s massive sales to Central and South America and the fall of the Shah. During the 1980s, as its economy tumbled, Israel lost markets but large investments made during the middle part of the decade saw its high-tech industry become one of the world’s most advanced. This was aided by ‘normalization’ during the Oslo process whereby Israel, less of a pariah, was a more acceptable partner for military relations.
By the 1990s, Israel was firmly established as the tenth-ranked arms exporter in the world but the fourth-largest to developing countries, including rogue states in Africa, Latin America and even the Middle East.7 India has been the largest recipient of Israeli arms for much of the last decade, along with Turkey, China and the US. Currently, Brazil is becoming a more important recipient than Turkey, with Russia starting to be important. Singapore has been a big market for decades now, relative to its size, with Israel’s first drone export going to the country in 1978. Switzerland is a significant purchaser.
A theme common to Israel’s largest weapons customers is that they have used the weapons to repress civilians and small-scale guerrilla groups. This is largely a consequence of Israel, as an often marginalized state, being less concerned about the diplomatic consequences of selling to those countries and because the Israeli industry has specialized in equipment designed to control civilians.8
Initially, retiring army officers came to dominate the emerging arms companies, creating an elite that controlled public and private life in Israel. Economic analyses suggesting that the industry was not as well run as it could be and the advent of globalization led to the privatization and professionalization of the arms industry.9
The Israeli economy is among the most militarized in the world. Defying accepted economic wisdom, over the past decade and prior to the credit crunch, wars and terrorist attacks have been increasing in Israel while the Tel Aviv stock exchange has risen to record levels. Israeli companies pioneered the homeland security industry and continue to dominate the sector today. The Israeli security industry includes over 600 companies, employing about 25,000 people, with over 300 of these companies exporting products and services.10
At the Paris Air Show in 2009, Elbit Systems Ltd – which, among other activities, was partly responsible for the separation barrier with the occupied territories, at a cost of $2.5bn, and which with Boeing was contracted to build the proposed wall between the US and Mexico, before the abandonment of the project in late January 2011 – was among the most sought-out exhibitors. Using a massive IMAX screen the company spooled continuous footage of a simulated attack on a Palestinian village in order to showcase its unmanned drone surveillance and attack aircraft. A flock of hawk-like salesmen regaled potential clients with stories of ‘our decades of testing weapons in real conflict situations’.
After the dotcom crash of 2000, when the Israeli economy experienced its worst year since the early 1950s, the government again intervened with a 10.7 per cent increase in military spending and encouraged tech industries into the security and surveillance fields.
After 9/11, the Israeli state openly embraced the idea of a homeland security boom. By 2004, the economy had recovered and by the following year was outperforming most Western economies.11 It had become a shopping mall for homeland security technologies. The industry’s pitch was simple: ‘We have been fighting a War on Terror since our birth, we’ll show you how it’s done.’12
The War on Terror industry was crucial in saving Israel’s faltering economy. A prominent Israeli investment analyst told Forbes magazine that security matters more than peace. Naomi Klein asserts that it is no coincidence that the decision to put defence and counter-terrorism at the centre of its economic strategy coincided with the abandonment of peace negotiations and the reframing of the conflict against Palestinians not as a battle against a nationalist movement but as part of the global War on Terror.13
This does not minimize the reality that there would a massive peace dividend for Israel: while the economy would suffer short-term adjustment shocks, peace would enable resources to be redirected to more productive activity and trading with Arab nations would increase exponentially.
But peace is far from the minds of arms company executives. While the ill-fated Lebanon invasion of 2006 was a somewhat tarnished showpiece for Israeli and US weaponry, Israeli companies didn’t just support the attacks but sponsored them, running ads promoting the war together with corporate branding. The stock market rose in August 2006, the month of the war. In that year which had seen a bloody escalation of hostilities in the West Bank and Gaza, Israel’s economy grew by almost 6 per cent. The bombings of Gaza in late 2008 and early 2009 were a better marketing tool, demonstrating the immense destructive powers of Elbit’s unmanned drones which minimized Israeli Defence Force (IDF) casualties while maximizing Palestinian fatalities and the destruction of much of Gaza.14 After the Gaza invasion Israel held a closed arms fair to demonstrate how well its new weapons for urban warfare had worked.15
Despite it being the mainstay of Israel’s economy, the defence sector is still unable to meet all the country’s weapons needs, with all planes, larger boats and submarines imported. The US is unsurprisingly the biggest supplier, on very favourable terms. Israel has been the largest recipient of US security assistance since the early 1970s, when the Nixon administration dramatically increased military aid to the country and cemented the close relationship that endures to this day. Henry Kissinger was supposed to have quipped that ‘for every tank we give to Israel, its neighbours buy four from us’.16
In recent years both US military aid and weapons transfers have expanded. At the same time, the intensity and ruthlessness of Israeli military operations have also increased, with US weapons and military hardware of every size on lethal display.17 Between 2002 and 2007, Israel received over $19bn in direct military aid from the Bush administration and in August 2007 the US and Israeli governments signed a ten-year Memorandum of Understanding (MoU) for the provision of $30bn in US military aid.18 At the signing ceremony the Under Secretary of State for Political Affairs, Nicholas Burns, characterized the $30bn as ‘an investment in peace’ and emphasized America’s ‘abiding interest in the security of Israel’.19 Arms sales from France, Germany and the UK are on a smaller scale but nevertheless significant.20 In the first quarter of 2008 the British government licensed weapons sales worth almost £19m to Israel.21
Israel receives most of its US military assistance through what is known as Foreign Military Financing (FMF) – US grants for weapons purchases. At least as valuable is the special treatment that comes with the billions of dollars in grants. Israel is the only country allowed to use its US military aid to build its domestic military industry, a privilege that includes developing indigenous weapons systems based on US designs and using FMF funds to purchase materials, as well as research and development, from Israeli firms. Additional US funds are spent on joint military research and production such as anti-ballistic missile defence systems and even fighter jets. While other countries get their FMF doled out in quarterly allotments, Israel receives all of it in one lump sum early in the year – a practice that creates a loan burden for the US government, as it necessitates borrowing from the US Treasury long before Congress actually releases the monies promised. Along with a handful of other countries, Israel enjoys ‘fast-track’ status for weapons sales, meaning that it can essentially bypass the Pentagon’s intermediary role, involving cumbersome procedures and delays, to make deals directly with manufacturers.
Between 1998 and 2008, it is estimated that the Israeli government devoted $75bn to its military budget. During that same period, FMF alone accounted for nearly $25bn, essentially covering a third of Israel’s defence budget. According to an August 2008 memo by the American Israel Public Affairs Committee (AIPAC), Israel plans to double its military budget in the coming decade to $150bn.22
The billions of dollars in US military aid to Israel have bought a stunning array of US weapons and military hardware for the IDF. Israel has 226 F-16 fighter and attack jets, more than 700 M-60 tanks, 6,000 armoured personnel carriers,23 and scores of transport planes, attack helicopters, and utility and training aircraft, not to mention innumerable bombs and tactical missiles of all kinds. The IDF also has a wide array of munitions at its disposal, including cluster bombs and incendiary devices like white phosphorous. Israel is a more regular customer than almost any other nation; over the last ten years for which full data is available (financial years 1997–2007), Tel Aviv signed agreements for US weapons imports worth $10.59bn. Of the six biggest importers, only Saudi Arabia, with $10.7bn in US weapons purchased over the same period, signed agreements worth more.24
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The arms trade relationship with the US is about far more than just the purchasing of weapons. It is about the politics of the Middle East, and it touches on a range of geopolitical issues. As a source in the industry who is sympathetic to Israel told me: ‘Israel gets at least $2bn to $3bn a year from the US to buy US-made weapons. It uses some of them itself and also arms countries the US couldn’t, with a nod and a wink.’ The most extreme manifestation of this was the selling of arms to Iran.
It is well known that Israel had joined the US in supporting the Shah of Iran politically and militarily. Shortly before the fall of the Shah, Israel agreed to the sale of substantial arms to Iran and was paid for them. However, after the triumph of the revolution led by Ayatollah Khomeini, Israel refused to deliver. Khomeini broke off all relations with Israel and sued for $5bn. International arbitration on the matter has continued since 1983.25
It is not common knowledge, though, that while the West, and for a time the Soviets, supported Saddam Hussein’s Iraq against the Islamic Republic of Iran, the Israeli government and its arms agents, on behalf of the US, transferred hundreds of tons of weapons and equipment to Iran, shoring up a weak Iranian army as it faced defeat at Saddam’s hands. A few years after halting sales to Iran, Israel was approached by a French go-between, and agreed to sell arms to Khomeini’s regime in a secret operation codenamed ‘Seashell’. The Israelis believed that such sales would bring them closer to Iran’s rulers and weaken both Iran and Iraq. But, as important, the weapons industry wanted to make money. As one key figure in Operation Seashell recalls: ‘I do not remember even one discussion about the ethics of the matter. All that interested us was to sell, sell, sell more and more Israeli weapons and let them kill each other with them.’26
Weapons worth $75m reached Iran through a Portuguese arms dealer, George Pinole, who arranged false bills of lading and bribed officials of an Argentinian airline to transport the equipment. After one of the planes crashed, Pinole arranged alternative transport by sea. The Iranian impresario behind the operation was Dr Sadeq Tabatabai, a distant relative of Khomeini’s and one of his confidants in sensitive matters. Ironically his success with Operation Seashell led to Tabatabai being promoted through the ranks until he became a top Iranian representative in Lebanon and one of the midwives of Hezbollah, Israel’s bitter foe. It was Tabatabai who would later push for the abduction of two Israeli soldiers by Hezbollah that led to the war in the summer of 2006. But the ultimate irony was that after the strengthened Iranians forced a stalemate in the war with Iraq, they started to supply some of the arms Israel had shipped to them on to Hezbollah.27
Ronen Bergman has revealed new information about the Iran–Contra affair that reflects on the gullibility of the Israelis and the Americans in their involvement with arms dealers.28 Hashemi Rafsanjani, the moderate head of the Iranian legislature, and future President of the Islamic Republic, believed that Iran should adopt a more pragmatic foreign policy that would enable it to enlist Western support for its war against Iraq, including access to Western arms. In 1984, the Reagan administration rebuffed the Iranian overtures. As an alternative Iran approached Israel through two go-betweens: Manucher Ghorbanifar, an Iranian arms dealer and swindler who was close to Rafsanjani, and Adnan Khashoggi, the billionaire Saudi arms dealer. The Iranians wanted Israel to sell them arms and to mediate between them and the Americans. Ghorbanifar travelled to Israel on a Greek passport to conclude the $50m sale of combat equipment to Iran. Some of those involved on the Israeli side admitted that among their motives was financial gain.
The Americans became interested in the operation because of a desire to staunch the wave of abductions of Americans in Lebanon by the Iranian-backed Hezbollah. They envisaged acting on a number of parallel tracks: US Intelligence had set up a company called GMT as a cover both for its efforts to undermine the Iranian regime from within, as well as to foster anti-Soviet forces in South and Central America. The latter included the Nicaraguan Contras, the conservative rebel group opposed to the Sandinista government which had overthrown the Somoza dictatorship before winning elections in 1984. The CIA trained the Contras and acquired weapons for them through GMT, but wanted to intensify the operation. By transferring surplus NATO equipment from Europe to Israel to replace the Israeli arms that were to be sold to Iran at prices significantly higher than their true market value, the US could use the profits to finance the Contras. At the same time they would be improving relations with Iran and getting the hostages in Lebanon freed.29
A deal was signed between GMT and Israel at the Negev farm of the Defence Minister, Ariel Sharon, that determined how the operation would be implemented and the division of profits and commissions. The Director of the CIA, William Casey, was briefed about the deal and how the money would be funnelled through secret Swiss bank accounts. In the summer of 1985 the Israeli government gave the go-ahead. It was decided to leave the implementation to unofficial middlemen involved in the arms trade. Ghorbanifar was to represent the Iranians and Khashoggi was laying out the cash. The shipments began in August 1985. However, the missiles sent by Israel were faulty, having passed their sell-by dates. It still remains unclear who gave the instruction for faulty weapons to be delivered. Nevertheless, in exchange for the weapons delivered, Israel received replacement supplies from the US. One American hostage was released.30
What is clear is that under the umbrella of concern for the hostages, innumerable other undisclosed deals were happening between the US, Israel and Iran. About 600 tons of ammunition, weapons and equipment was shipped to Iran. A person involved in the deals said: ‘There were very few Israeli companies with anything to sell to Iran, [sic] which were not selling. The entire government-owned military industry and the privately owned military industries were involved in it, very deeply.’31 Ronen Bergman’s access to the internal documents of the Israeli side of the operation reveals that Israel also supplied arms directly to the Central American rebels for additional profit.
The failure to gain the release of more than one hostage led the Israelis to appoint Amiram Nir, the Prime Minister’s counter-terror adviser, to take charge of the operation, in what became the second stage of the Iran–Contra affair. His opposite number in the US was Colonel Oliver North, the gung-ho official of the National Security Council. Nir decided that it should be agreed with the Iranians exactly how much equipment would be supplied for the release of specific numbers of hostages. Added sweeteners included the promise of dialogue between the Iranians and the Americans and the release of thirty-nine Shi’ite prisoners held by the pro-Israeli South Lebanon militia. This gesture could also be used to explain the release of the hostages by the Iranians, while hiding the arms transactions.
Nir met with North and then Ghorbanifar and Khashoggi. President Reagan gave the go-ahead. Front companies and bank accounts in Switzerland and Liechtenstein were set up. Ghorbanifar deposited $10m in the Swiss bank account and, on 16 February 1986, 1,000 missiles were flown into Israel, transferred to an El Al cargo plane whose markings had been painted over, and flown on to Tehran by an American crew. Two days later, and in violation of the carefully crafted agreement, two Israeli soldiers were abducted by Hezbollah in Lebanon, apparently to spur the Israelis to supply more weapons to Iran. After an exchange of letters between the Prime Minister of Israel and the US President – delivered by Nir to North – and the deposit of a further $15m, the second shipment began. Documents reveal that not only was Israel supplying Iran with faulty weapons, but it appears the US was trying to do the same to Israel for reasons that remain unclear.32
When George H. W. Bush ran for the presidency he strenuously denied that he had any knowledge of this sordid affair which took place while he was Vice President. However, intelligence documents reveal that in July 1986, as US Vice President, he was personally briefed by Nir on the whole operation. In his later report on the meeting to the Prime Minister, Shimon Peres, Nir stressed that Israel was doing everything to provide cover that would protect the US from exposure for the whole operation, which was, after all, undertaken at the explicit request of the Americans. He described Bush’s tone in the meeting as supportive and optimistic.33
However, in 1986 word leaked about the secret transactions. The Lebanese magazine Ash-Shiraa published a series of articles in November that exposed the weapons-for-hostages deal. It was soon revealed that the huge profits from the arms sales to Iran had been used to fund the Contras. There was outrage in Congress, which had explicitly forbidden such support. Reagan’s spokesperson quickly blamed the Israelis, who were furious. They decided not to respond publicly as they were still maintaining a link to Ghorbanifar in the hope that it would lead to the release of the hostages, thereby bolstering Reagan’s position vis-à-vis the planned Congressional inquiry and serving to vindicate the entire operation.
But then the Washington Post discovered that at the same time as it was dealing secretly with Iran, the CIA had supplied Iraq with intelligence about key targets in Iran. The Iranian regime broke off all contact. Nir was thrown to the press as the fall guy in the US and Israel, where he remained in relative seclusion until he died in a mysterious crash in 1988, allegedly on a plane belonging to the CIA front that had flown weapons to Iran.34
* * *
The intersection of intelligence agents and arms dealers is common. Ronen Bergman describes the Israeli situation: ‘Arms dealers naturally have access to sensitive information, much more than a regular businessman would have. The Israeli intelligence community knows how to use these dealers, now and again, for its purposes. Since the intelligence community is involved in the official procedures for giving these dealers their export licences, it can easily create an unhealthy dependence on its approval. The consequences are often disastrous.’35
Nahum Manbar, who had links to Mossad while making millions in the arms business, sold chemical weapons to the Iranians, leading some in the CIA to believe that while encouraging the US to take strong measures against Iran, the Israelis were conducting an operation behind their backs.36
Manbar, codenamed ‘Termite’ by Mossad, was born on a kibbutz which his family had helped found. He served in the IDF during the 1967 and 1973 wars before entering the arms business. He linked up with Bari Hashemi (alias Farschi), an Iranian defence ministry purchasing agent who headed a Vienna-based company. Initially, Manbar bought weaponry, often from the Polish army, which he sold on to the Iranians. He also sold them protective gear against atomic, biological and chemical arms, soon setting up a plant in Poland to manufacture the products. He claims that the relevant Israeli authorities were fully informed of his activities. When approached by the Iranians to provide them with chemical weapons, Manbar is adamant that he reported the requests to the appropriate Israeli ‘factors’. They instructed him to get more details about what the Iranians wanted. ‘I asked the Iranians to submit more blueprints and sketches. Everything was conveyed to Israel.’37
Manbar had become wealthy through arms trading. Many people and companies wanted part of the action. Through Brigadier General Amos Kotzer, Manbar offered to supply Israeli Intelligence with information on military subjects, as well as on the missing Israeli airman Ron Arad. Arad had been captured by Lebanese Shi’ite militia in October 1986 after being forced to eject while on a mission to bomb PLO targets. Manbar believed that with his excellent contacts in Iran he might be able to bring the airman home. His leads on the Arad case ultimately proved worthless.38
In late 1990, Manbar signed a contract with Dr Majid Abbaspour, a special assistant to the Iranian President and still one of the key figures in Iranian arms procurement, to supply the know-how for the production of substances used in chemical weapons, to set up a production plant with the necessary equipment and to train teams of employees. Manbar was to be paid $16.23m. In 1992, Israeli internal security agents met Manbar and ordered him to cease all activities with Iran and hand over all documents connected to them. For the next six years he enjoyed his multimillions, with villas on the Swiss–Italian border and the French Riviera, where he entertained many in the Israeli power elite, showering them with the best of everything. He visited Israel regularly, investing in Israeli basketball teams and being photographed with, among others, Shimon Peres, now the Israeli President, the future Prime Minister Ehud Olmert and Yitzhak Rabin’s wife, Leah.39
Britain’s MI6 tried to exploit Manbar’s network in order to penetrate the Iranian arms industry. A young agent named Richard Tomlinson was given the mission. He claims that ‘We never intended to interfere with Manbar’s work. On the contrary, the whole thing was a classical British intelligence operation: to allow authentic private businessmen to enter into relationships with hostile countries and later to penetrate their networks in order to gather information on the target country.’40 Tomlinson, who was jailed for trying to publish a sensational book on his experiences, is absolutely certain that Manbar acted on behalf of Israeli Intelligence in his arms deals with Iran: ‘We had no doubt about it. Officially, the Mossad never admitted that Manbar was acting on its behalf, but it was clear that the Israelis knew about everything that he did.’ He further claims that ‘Mossad kept trying to disrupt our work and didn’t hand over all the documents that it had.’41 The CIA shared MI6’s conviction that Manbar was working for Mossad, casting a shadow over the relationship between the two agencies.
Manbar claims he ended all connections with Iran in 1993 after being ‘spoken to by the Israelis’. But he admits that in 1995 he gave Abbaspour’s calling card to the Foreign Minister at the time, Peres, who ‘took the card and told me that the matter was being dealt with’.42 Two weeks later Manbar contributed $200,000 to Peres’s campaign funds.
He was eventually arrested in Israel in March 1997. A blanket gagging order prevented the media from reporting the details of the case. His trial was held behind closed doors and much of the testimony was classified. Manbar’s lawyers asserted that the Israeli arms industry – including Israeli businessmen who functioned with the ostensible permission of the security authorities – had sold and were still selling vast quantities of material to Iran. The judges partially accepted this argument and levelled sharp criticism at the state’s conduct. He was sentenced to sixteen years in prison. Richard Tomlinson suggests that ‘Just as it happens often in intelligence services, the Israelis decided to get rid of Manbar, break off the connections and make him a scapegoat. The Mossad kept all the documents that could have proved his innocence to itself.’43
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Iran was not the only beneficiary of Israel’s lax approach to arms control. The Georgian conflict with Russia was fuelled by Israeli arms, which many speculate were provided with American backing.44
At the time of the Russian invasion in August 2008, the Georgian defence establishment was dominated by Israelis, notwithstanding that a number of Israeli arms companies had simultaneous contracts with the Russians.45 This dominance was a consequence of the number of Georgians who have emigrated to Israel and work in the defence sector and the fact that Georgia’s Defence Minister at the time, Davit Kezerashvili, is a former Israeli. According to a well-placed Georgian source, deals with the Israeli defence industry ‘were conducted fast, mainly due to the Defence Minister’s personal involvement’.46 Among the Israelis providing some $500m of military equipment to Georgia were an ex-mayor of Tel Aviv, Roni Milo, and his brother Shlomo, a former director general of Israel Military Industries, Brigadier General Gal Hirsch and Major General Yisrael Ziv.47 Hirsch had commanded Israeli forces in the second Lebanon war, and resigned after being accused of poor leadership. He then formed his own company and became an agent for arms sales to Georgia. He persuaded the Georgians that Israeli equipment would enable them to defeat the Russians.48 While Hirsch doesn’t describe himself as an arms dealer, but rather as a military trainer, he made clear to the Georgians exactly what equipment they should buy and where to source it.49
Aeronautics Defense Systems provided equipment to both the Georgian and the Russian security forces prior to the war and, in Russia’s case, afterwards. Israelis’ activities in Georgia, and the deals struck, were all authorized by the Ministry of Defence. However, Israel Aerospace Industries refused to participate in activity with Georgia as the company felt it would anger the Russians, with whom it was involved in a project to improve fighter jets produced in the former Soviet Union. This led to an Israeli decision to sell Georgia only non-offensive weapons systems. The difficulty of this delicate diplomatic balancing act was illustrated by the comments of another Jewish Georgian minister who, in the wake of the invasion, called for help ‘from the UN and from our friends, headed by the United States and Israel’.50
In mid-2011, Ziv’s firm, Global CST, solicited business from the Georgian breakaway republic of Abkhazia, which is supported by Hamas, among others.51 Should a contract emerge, Global CST will have trained both the Georgian forces and those of the Abkhazian breakaway republic in the next war. Israeli access to Abkhazia comes, not coincidentally, as military relations with Russia continue to warm. Abkhazia has Russian patronage and would have been inaccessible to Israelis previously.
What happened in Georgia is by no means exceptional. Former Israeli officers train people all around the world, in deals often arranged by arms merchants. All manner of ruses are used to get to the bottom line: the selling of weapons and security equipment. In one example, an entity called New Horizons Consultants (NHC) developed a service to help the democratization of African countries. Its members include the General Manager of the Likud Party, who was a former campaign manager for Ariel Sharon and Binyamin Netanyahu, a retired commander of the Counter-Terrorism Unit of the Israeli Police and a former Commander of the IDF Ground Forces. They offer the ultimate service: from how to start a political party to the running of an election campaign, which ‘may lead to instability’, requiring the strengthening of the ‘police establishment’, and, of course, ‘a strong democracy also needs a strong army to protect its borders’. NHC provides training and equipment through a unique one-stop shop that includes all requirements for riot control, ground forces, homeland security, counter- and anti-terror, K9 dogs, and identification of and protection against nuclear, biological and chemical weapons. And, of course, the providers of this one-stop shop specialize in ‘the sale and distribution of defense systems & equipment to the Israeli Government & the international community’.52
Israel’s aggressive exporting of weapons and know-how has consequences for America because of the technology- and production-sharing between Israel and the US. This poses the constant risk that US technologies will be transferred to other, ‘non-friendly’, countries. To cite just one example, the Chinese air force flies a Jian-10 fighter plane that is very similar to the Israeli Lavi, a joint Israeli–US design based on the F-16. Although the joint production of this fighter plane was cancelled in 1987 because of cost overruns, and to prevent the Israelis becoming direct competitors for exports, the design and technology ended up in Beijing. Indeed, Israel is China’s second-largest weapons supplier after Russia.53
Despite close US–Chinese economic ties, the two nations remain military rivals, and most future nation-state war scenarios imagined by Pentagon planners involve China as an adversary in some way. That Washington’s closest ally is assisting a ‘near peer’ rival to obtain high-tech weaponry should be a major worry. China’s own role as an arms dealer is well known and has been roundly criticized in Washington. Just over a decade ago, the UN Register of Conventional Arms disclosed that China had passed on technology that was co-developed by Israel and the US to Iran and Iraq, among other nations.54
* * *
The shadow world, as we have seen, is replete with Israelis operating as middlemen, agents and dealers. The country has also provided citizenship – and thus the ability to travel and bank with discretion – to an alarming number of shady arms agents and brokers, primarily from the former Soviet Union. A veteran Israeli investigative reporter, Yossi Melman, tells a joke that the Israeli business community is divided into two: ‘Those who are arms dealers and those who don’t admit they’re arms dealers.’
President Teodoro Obiang has ruled Equatorial Guinea since a bloody coup in 1979. He is believed to have ordered the deaths of thousands of his citizens during his tenure as head of one of the most corrupt regimes on the continent. US law enforcement agencies revealed several years ago that Obiang held accounts at Riggs Bank’s Washington DC branch containing some $700m. The accounts were frozen on suspicion of Obiang having received bribes. An Israeli businesswoman, Yardena Ovadia, befriended Obiang after a visit to his impoverished nation. In 2008, Ovadia operated as a mediator in arms sales to Equatorial Guinea for sums of up to $100m. The deals involved Israel Shipyards Ltd and Israel Military Industries Ltd. In the past Ovadia has been connected to deals with Obiang involving Brigadier General Shlomo Ilia and Boaz Badihi, an Israeli who operates from South Africa.55
It is always difficult to know whether arms agents are operating as renegade dealers on their own account or with a degree of state backing. Rumours abound of their relationships with senior political leaders or their utility to the country’s intelligence agencies. The nature of the Israeli state, its permanent war footing and its legendary engagement with pariah regimes – apartheid South Africa on weapons and nuclear technology, Pinochet’s Chile, Mugabe’s Zimbabwe and all three sides in the Angolan civil war56 – makes it even more difficult to assess this in the case of Israeli arms dealers such as Ovadia, Arcadi Gaydamak, Leonid Minin, Yair Klein, Shimon Yelenik and others. Jimmy Johnson describes the involvement of Minin, Klein, Yelenik and Israeli diamond dealers in Africa and beyond as a picture ‘not only of war crimes, profiteering, massive environmental destruction, corruption and greed, but one of Israelis, Hezbollah and Al Qaeda all working together in mutually profitable enterprises, regardless of principle or ideology.57
Israel’s relationship with apartheid South Africa was particularly bizarre, given the Nazi sympathies of the leaders of the racist state. The sight of South Africa’s Prime Minister and brutal former Justice Minister, B. J. Vorster, paying his respects at the Yad Vashem memorial to victims of the Holocaust was especially surreal, given that Vorster had been interned during the Second World War for his strong Nazi sympathies. In a recent book, Sasha Polakow-Suransky has documented how Israel’s booming arms industry and South Africa’s isolation led to a semi-hidden military alliance that continued even after Israel passed sanctions against South Africa in 1980. The unlikely allies exchanged billions of dollars of extremely sensitive material, including nuclear technology, which boosted Israel’s struggling economy and strengthened the beleaguered apartheid regime. The documents that Polakow-Suransky unearthed of the myriad deals confirm that Israel has been a nuclear power for decades, a truth that Washington dare not speak.58
There are two reasons why Israel dominates the shadow world: the first is the right of return to Israel for any Jew,59 and the second is the deeply militarized and sometimes corrupt nature of the society. It therefore provides a desirable bolt-hole for arms dealers who might be in legal difficulty elsewhere, while providing a conducive environment for continued arms trading.
Israel struggles with corruption: for instance, when the former Prime Minister Ehud Olmert was indicted for fraud in August 2009, he was the fourth senior politician to face criminal charges in twelve months; while his three predecessors also faced corruption allegations, none culminated in criminal charges. The Movement for Quality Government in Israel commented that ‘Governmental corruption has reached the point that it represents a strategic threat to Israel.’60 ‘Official illegality’ in covert operations, including the use of false or stolen identity documents, untraceable weapons, etc., is also common practice.61 This increases the country’s appeal for illicit arms dealers.
Israel’s militarization has created not a revolving door between military and civilian activities, but an open doorway. This is reflected in the ease with which former army officers become arms dealers once they have left the military. As Shir Hever, a leading, critical economic analyst of the Israeli military, has noted, the permit system is so lax that senior officers in the IDF almost always have the connections to get permits to trade in arms. The IDF has a very young retirement age – forty for combatants, forty-five for non-combatants and officers. So, at forty-five they are looking for other jobs, often becoming mayors or CEOs of defence companies.
For most of them, their primary skills are combat and control, so many set up an arms company.62 They invent a product and then ask their friends in the army to buy even just a few of it. The fact that the IDF uses it is a key marketing tool. ‘Wherever we try and sell they want to know if it’s been used by the Israeli army.’ And they are willing to sell to anyone, driven exclusively by the profit motive. In 2006, soldiers captured in Lebanon were shot with weapons showing Israeli markings. The weapons had been sold to Iran and were then sent to Hezbollah. Because individuals get permits so easily, the system gets out of hand and they end up selling weapons to Hezbollah, even if indirectly.63
Yossi Melman suggests that dodgy deals occur ‘because Israel is a small country based on an old boys’ network and there is insufficient supervision of the system. For a former officer, a small dodgy deal changes his life. Officials won’t say no, as they may want to work for them in the future.’ The licence is his main asset, as he could sell ‘battle-proven Israeli arms’. Before the changes, the department in the Ministry of Defence responsible for marketing weapons exports was also tasked with licensing and supervising arms dealers. Melman shrugs: ‘You can’t supervise arms deals if you’re promoting them!’ In 2007, supervision and marketing were separated and in theory there is now extensive supervision. However, the new regime is not implemented with great conviction.64 ‘It’s still a revolving door, so the problems continue. And there is apathy towards corruption. Israel won’t fight military-security corruption because of the old boy network.’65
A former weapons salesman for an Israeli company told me that in a society as militarized as Israel, all the key people in the defence industry are ex-officers. The defence ministry is, therefore, under huge pressure from the industry not only to give contracts but also to ensure that it can operate unhindered and unscrutinized. Such is the extent of malfeasance that there is double-dealing even within companies: my source recounts how an arms dealer he knows is a legitimate agent for a large weapons-maker but also circumvents the licence process to undercut the company’s price by 20 per cent in illicit deals about which the company knows nothing. In Israel, like the UK and the US, the big weapons companies are rarely properly investigated. They very seldom land up in court.66
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As Mearsheimer and Walt have argued in their book The Israel Lobby and US Foreign Policy, Israel wields an inordinate amount of influence on US foreign policy, not always in the best interests of America. In fact, they argue that by encouraging unconditional financial and diplomatic – and I would add military – support for Israel, the lobby jeopardizes America’s and Israel’s long-term security.67 But that military support, even connivance, has intensified in the last five years, just as the intensity and ruthlessness of Israeli military operations have increased.
Israel used US-supplied weapons, including Lockheed Martin’s F-16 fighter planes and Boeing’s GBU-39 bombs, in its July 2006 war in Lebanon and its December 2008 to January 2009 operation in Gaza to devastating effect, with civilians overwhelmingly bearing the brunt of the attacks. In the summer 2006 intervention in Lebanon, F-16 fighters were used to bomb Lebanese targets, while Lockheed’s Multiple-Launch Rocket System (MLRS) sprayed cluster bombs across the countryside. A cluster bomb is essentially a large canister – as long as thirteen feet and weighing up to 2,000 pounds – packed with hundreds of ‘bomblets’ that can have an explosive impact on an area the size of three football fields, spreading shrapnel along the way.68
Although it is important to note that Hezbollah forces also fired missiles into northern Israel, including 100 or more Chinese-made rockets packed with cluster munitions, the issue has been the extent to which Israel’s attack was disproportionate, and whether it put civilians at risk unnecessarily. The Israeli air force launched more than 7,000 air strikes during the conflict. The bombs hit roads, bridges, airports, factories and power plants, killing over 1,000 people, injuring over 4,300 and driving nearly a million more from their homes. At least 860 of the dead were civilians. Hezbollah’s rockets were responsible for the deaths of fifty-five Israelis, of whom forty-three were civilians.69 The attacks were devastating and indiscriminate enough to elicit Amnesty International’s assertion that ‘war crimes had been committed’, and the UN’s Undersecretary General for Humanitarian Affairs and Emergency Relief, Jan Egeland, called them ‘a violation of international humanitarian law’.70
In Israel’s 2008–9 intervention in the Gaza strip, which by one account killed over 1,400 civilians, F-16s were used to run bombing raids as part of the overall military operation, known as Operation Cast Lead.71 At least 121 women and 288 children were killed. By contrast the total toll of thirteen Israeli deaths included two civilians. Of the eleven IDF soldiers killed, four died from ‘friendly fire’.72
As devastating as the aerial attacks in Lebanon and Gaza were, it has been the use of US-supplied cluster bombs that has drawn the most international attention. Their military uses include attempting to slow down advancing troops, destroying airfields and taking out surface-to-air missile sites. Because cluster bombs can kill or wound anything in a large area, there is a high risk of hitting civilians as ‘collateral damage’ in the initial attack. They can also leave large numbers of unexploded ‘bomblets’ on the ground that blow up later on impact – when stepped on inadvertently, or picked up by a child, or run over by a plough. After Israel dropped millions of cluster bomblets during its thirty-four-day war in Lebanon, hundreds of thousands were left unexploded. Human Rights Watch estimates there have been at least 200 fatalities caused by leftover cluster munitions, and hundreds of injuries.73
The bomblets can be as small as a fizzy-drink can or a torch battery, and they don’t look particularly menacing to someone unfamiliar with what they are. The results of this confusion can be devastating. Eleven-year-old Ramy Shibleh lost his right arm when he picked up a cluster bomblet that had got in the way of a cart that he and his brother were using to carry the pine cones they were collecting. The bombing also had a crippling effect on agricultural production in southern Lebanon, where unexploded cluster munitions rendered fields and orchards unusable, making them the equivalent of mine fields. A commander of an Israeli rocket unit told the Israeli daily Haaretz that the saturation bombing of Lebanon was ‘monstrous; we covered entire towns in cluster bombs’.74 The outrage at the use of this inhuman weapon was intensified when it came to light that Israel was launching more cluster munition volleys into Lebanon even while a ceasefire was being negotiated. According to Jan Egeland, ‘90 percent of the cluster bomb strikes occurred in the last 72 hours of the conflict, when we knew there would be a resolution’. Egeland called the strikes ‘shocking and immoral’.75
The Lockheed Martin MLRS played a central role in the cluster-bombing of Lebanon. Researchers who went to the country after the war found large numbers of M-26 rockets that had been fired from MLRS systems. Each time the MLRS was used, it spread more than 7,700 cluster bomblets over the Lebanese landscape.76
The Israeli case is a telling example of how difficult it is to control the use of weaponry once it is sold, even when the purchaser is an ally. The non-governmental advocacy group Landmine Action uncovered a secret US–Israeli agreement governing the use of US-supplied cluster bombs which indicated that they should be used ‘only for defensive purposes, against fortified targets, and only if attacked by two or more Arab states’. It also limited them to being used only against ‘regular forces of a sovereign nation’. A preliminary State Department investigation found ‘likely violations’, but the ultimate findings of the review have been classified.77
Despite Israel violating the secret agreement with the US, Congress did not push for a full investigation. In fact, as the civilian death toll rose in Gaza, the House and Senate passed resolutions overwhelmingly supporting Israel’s offensive. The validity of the self-defence rhetoric employed by Israel and parroted by the US is undermined by the disproportionate use of force and the reality that military action was premeditated and awaiting a trigger. A letter from Representative Dennis Kucinich in January 2009 to the Secretary of State, Condoleezza Rice – the only call for an investigation by an American lawmaker – made clear that ‘Israel’s attacks neither further internal security nor do they constitute “legitimate” acts of self-defense. They do, however, “increase the possibility of an outbreak or escalation of conflict,” because they are a vastly disproportionate response to the provocation, and because the Palestinian population is suffering from those military attacks in numbers far exceeding Israeli losses in life and property.’78
Premeditation also nullifies any claim to self-defence. The March 2007 testimony of the Israeli Prime Minister at the time, Ehud Olmert, to the Winograd Commission set up by the Israeli government to investigate Israel’s prosecution of the Lebanon war, states explicitly that his administration had decided ‘at least four months in advance’ of the [2006] operations that any kidnap of Israeli troops on its borders would trigger war. As for the 2009 Gaza War, the evidence that Operation Cast Lead was planned well in advance and just awaited a strike from Hamas to set it in motion is similarly convincing. Writing in Haaretz, the analyst Barak Ravid cites sources within the Israeli defence establishment stating that ‘Defense Minister Ehud Barak instructed the Israel Defense Forces to prepare for the operation over six months ago, even as Israel was beginning to negotiate a cease-fire agreement with Hamas.’79
The US has, on occasion, briefly suspended weapons transfers to Israel, such as in 1982 at the time of an earlier Israeli invasion of Lebanon, when the Reagan administration suspended all military aid and transfers to Israel after determining that Israel may have violated the terms of a 1952 Mutual Defense Assistance Agreement (which included a commitment that US military matériel and other assistance would be used only to ‘maintain its internal security, its legitimate self defense … and not to undertake any act of aggression against any other state’). A ten-week investigation into whether Israel was using weapons for ‘defensive purposes’ was inconclusive and the ban was lifted. This was the firmest US rebuke to Israeli military action in the last quarter-century.80
The former Israeli weapons salesman I spoke to told me that in 2007 there was a ban on the delivery of night-vision equipment from a US manufacturer, ITT.81 Even goggles already ordered were not allowed to be delivered after the ban. But US soldiers in Afghanistan found US night-vision goggles in a cave after a fight with the Taliban. The serial numbers indicated that they had been delivered to the IDF in defiance of the ban, and had found their way to the Taliban, probably at a huge premium. He says this is an example of arms-exporting laws passed in the US which, when it comes to Israel, are just ignored.82
The United States is simply unwilling to hold Israel to account for transgressions of the laws regulating the use of US-supplied weaponry or even of special bilateral agreements on their use, as in the case of cluster munitions. While in the army, my source was using ammunition that wasn’t yet approved in the US. It came from the American company ALS, where it was still in the testing phase and, thus, not legally usable in the US. But it was being used against people in the occupied territories by the IDF.83
In this and other ways, the US doesn’t just accept Israeli illegality in weapons use, but actively supports military missions using US weaponry that kills civilians. During the Lebanon assault, the Pentagon complied with an Israeli request for military fuels worth up to $210m. Two days after Operation Cast Lead was launched, the Jerusalem Post reported that the Israeli air force was using recently delivered GBU-39 bombs – 250-pound GPS-guided bombs manufactured by Boeing, capable of piercing more than three feet of reinforced concrete – to penetrate Hamas’s underground rocket launcher sites. The US also tried to transfer new weaponry in the midst of the operation: according to a 9 January 2009 Reuters report, the US had tried to hire a merchant ship to transport hundreds of tons of US arms from Greece to Israel.84
Barack Obama initially set out to depart from the foreign policy path set by his predecessor. For a few brief months he was critical of the Israeli right-wing government under the Likud hardliner Binyamin Netanyahu. But in March 2010, as the Israeli Prime Minister was at the White House supposedly experiencing the full wrath of the Obama administration about his refusal to countenance a permanent cessation of illegal settlement building in the West Bank and East Jerusalem – identified as a major stumbling block to peace talks – the administration was finalizing details of a $3bn arms deal with Israel. In terms of the deal, Israel will purchase three new Hercules C-130J aircraft designed and built specifically for their needs by Lockheed Martin.85 In October 2010, it was announced that Israel will also purchase twenty F-35s from the same company, with a further option for seventy-five more.86
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Today Israel is at the forefront of high-tech military development, and undertakes a massive amount of R&D on behalf of not only its own companies but also US companies and the Pentagon. Shir Hever believes that Israel is the only country that buys from its own companies using US aid money, by setting up US subsidiaries. So technology seeps both ways.87
My arms salesman source suggests that ‘the latest, state of the art equipment is never sold, but is only for the IDF and the US’. Among other things, Israel has pioneered unmanned bulldozers, jeeps, drones – in which it is the global leader – surveillance equipment and ships. The separation barrier is equipped with unmanned, armed observation points that, through personnel in a distant, secure location, identify and fire on anyone who comes too near to the barrier. This is the creation of a robotic warfare that accelerates and intensifies the process of dehumanization and non-culpability for death – the very factors that have enabled mass killings and genocide to occur from Auschwitz to Kigali.
As the son of a Holocaust survivor I desperately wish that the US and Israel would consider that one of the ways to pay tribute to the suffering of Jews during the Holocaust is to condemn the atrocities caused by the trade in arms, whether they involve Jews or non-Jews, whether perpetrated by or against the state of Israel. A more transparent, honest arms trade can contribute to a reduction in the oppression of one people by another, the persecution of one group by another.