The US and its Deadly Faustian Bargain

Sometimes the truth is plain to see, not concealed but evident on the surface. And as Louis Armstrong sang, “You must remember this. A kiss is still a kiss, a sigh is just a sigh. The fundamental things apply.” Some things don’t change as time goes by. I remember this whenever I read yet once more that old story of the US selling weapons to both sides of a conflict somewhere in the world.

Here’s the re-telling of the old story on October 19th, 2010. Billions to Pakistan, billions from India:

American officials who have briefed the media on the subject ahead of the “strategic dialogue” say the package, totaling as much as $2 billion over five years, is aimed at helping Pakistan fight extremists on its border with Afghanistan.

The package will be in the form of financial aid under the American Foreign Military Financing (FMF) program, which in turn will help Pakistan purchase weapons and defense equipment like helicopter gunships and communication equipment produced in the United States.

It is aimed at addressing Pakistan’s insistence it does not have the capability to go after terrorists, and needs more support from the United States, according to the New York Times and CNN, which both reported the development on Monday.

The latest US largesse for Pakistan, which is separate from the five-year, $ 7.5 billion aid under the Kerry-Lugar-Berman bill, comes even as Washington is lobbying fiercely for greater Indian defense purchases worth billions of dollars as New Delhi seeks to shore up its military.

India has finalized nearly $ 10 billion worth of military purchases from the US in recent months, including a deal in 2009 for eight Boeing P-81 maritime patrol aircraft worth $2.1 billion and the sale this year of 10 Boeing C-17 Globemaster III Aircrafts worth $5.8 billion, the largest defense deal with India in US history.

An even bigger piece of action is in the pipeline – a purchase worth more than $ 10 billion for 126 Multi-Role Combat Aircraft that New Delhi is seeking, and for which US companies Boeing and Lockheed Martin are in the race.

While India’s will be paying hard cash for all these transactions, Pakistan, which was already broke before it was overrun by floods of biblical proportions and reduced to begging, will essentially be getting freebie military hardware from the US in the name of fighting terrorism.

Pakistan gets free stuff that India has to buy to keep up. That news item is dated October 19th. Here’s one from Oct 20th: US Confirms $60 Billion Arms Sales Package for Saudi Arabia.

The outlines of the arms deal – the largest in U.S. history – had been known for some time, but the administration withheld an official announcement pending consultations with the U.S. Congress. Under its terms, the United States will provide Saudi Arabia with 84 advanced F-15 fighter planes with electronics and weapons packages tailored to Saudi needs. An additional 70 F-15’s already in Saudi hands will be upgraded to match the capabilities of the new planes.

Saudi Arabia will purchase a huge fleet of nearly 200 Apache, Blackhawk and other U.S. military helicopters, along with a vast array of radar systems, anti-aircraft and anti-ship missiles, and guided bombs.

F-15s for Saudi Arabia. Israel already has some, as that news report mentions.

Israel has long had U.S. F-15 fighters in its arsenal and recently has committed to purchase new F-35 strike fighter jets, which U.S. officials say will preserve Israel’s qualitative military advantage in the Middle East.

Give military aid to Israel. They get US F-15s. Then Saudi Arabia pays for its F-15s. Some old story. Give freebies to Pakistan and it forces India to buy to keep up in the arms race.

There’s nothing new in all this. Even a casual observer can see what’s going on. I have been writing about the game the US plays for a while. Right after the Sept 11, 2001 Islamic terrorist attack on the US I wrote in a post, “The Looking Glass War“:

In his quest for magical power, Dr. Faustus makes a pact with the devil in which he barters away his soul. It is a powerful tale of the dangers of hubris that compels the powerful to seek even more power and are willing to make deals with devils. Dr. Faustus squanders away many opportunities where he could have redeemed himself but didn’t. It appears that the US is all set to make a larger faustian bargain with Pakistan. It is possible that the other half of the latest deal with the devil will be a nuclear bomb in the financial district of San Francisco a few years from now.

. . .
There are certain facts that get buried in all the hand wringing and the breast-beating and the calls for a war against this ‘new kind of evil.’ First the fact that the US is the largest arms exporter in the world; second, the US has the greatest appetite in the world for the energy resources in the Middle East. To maintain its insatiable thirst for the Arab oil, the US is willing to wage wars. And to finance these wars, the US is willing to sell weapons to both sides of any conflict, as in the Iran-Iraq war.

In Oct 2004, I again visited the issue since the US giving Pakistan $1.5 billion in military supplies. The True Weapons of Mass Destruction:

A report by Josey Joseph in the Oct 14th Times of India warmed the cockles of my heart. The story is about the supply of military equipment from the US to Pakistan.

… On the pipeline are more than $1.5 billion worth of military supplies over five years. Plus, numerous futuristic deals.

The arms supply is now in full flow and icing on the cake is the F-16 fighters that Pakistan Air Force has been dreaming of for long. The Navy can look forward to a new generation of torpedoes to maritime aircraft.

But the biggest gainer would be the Army: a generational upgrade in almost its entire armoury including top of the line attack helicopters, radars.

Richard Armitage in a recent interview to a Pakistani TV channel said there are “more helicopters in the queue. We have gotten now a steady stream of dependable funding to help the Pakistani armed forces… We realise they need the proper equipment, so we have embarked on a five-year programme of support.”

Armitage was referring to the $1.5 billion military aid that Pakistan is receiving over the next five years.

While Americans justify them in the name of terrorism, the supply is adding teeth to Pakistan’s offensive capabilities that are almost completely focused on India.

Why is the US so hell-bent on supporting the terrorist nation of Pakistan? What is in it for the US? After all, Pakistan is also broke. Why, one could ask in puzzlement, would anyone want to sell military hardware to Pakistan? My answer is this: so that India would be forced to buy weapons from the US to keep up with the terrorist nation of Pakistan.

The story goes like this. The US gives away $1.5 billion worth of weapons to Pakistan. In effect, the US is paying its own producers of weapons, who in turn support the US policy makers by locating their factories of weapons of mass destruction in the policy makers’ constituency. Read more jobs for the merchants of death. Then India’s defense establishment looks over the border and says we now need $2.5 billion worth of stuff from the US. More jobs for the merchants of death. Total benefit to the merchants of death: $4.0 billion. Total cost to the impoverished populations of Pakistan and India: $4 billion.

Sept 2008, I had to write that old story once again. Why Pakistan is Useful Just the Way it is.

The “Friends of Pakistan are “Britain, France, Germany, the United States, China, the United Arab Emirates, Canada, Turkey, Australia and Italy plus the United Nations and the European Union.” Among these are nations — US, China, the Arab states, France, Britain — that give aid to Pakistan. The military component of the aid is what Pakistan uses to initiate and fight bloody wars with India. India, a desperately poor country, cannot afford these costly wars but it has to fight them because the Friends of Pakistan want that India bleeds. Pakistan is the instrument.

I can see the reason why the economic meltdown of Pakistan is certainly not in the interests of the Friends of Pakistan. The biggest dagger stuck in India’s rib would be pulled out and with it will disappear the prospects of selling arms to India, of keeping India engaged in 1,000-year jihads which Pakistan regularly declares against India. The Friends of Pakistan more certainly do not want Pakistan to fail. You too would get worried if the pit bull you have trained for years to attack suddenly is in danger of dropping dead.

The Friends of Pakistan have an interest in keeping the conflict between India and Pakistan alive. Why do I say that? I use the revealed preference argument. Basically it says that by freely choosing something, you reveal what you prefer. If you have the power to choose a “Pakistan Friendly to India” but instead choose a “Pakistan as a Sworn Mortal Enemy of India”, you have revealed that you prefer that. I take it is obvious that the Friends of Pakistan could have easily enough told Pakistan that it should stop its belligerence towards India and concentrate on economic development. But they do not and that is why I believe that they have an interest in keeping Pakistan dependent on their money because Pakistan does their bidding.

Absent the conflict, the Indian subcontinent will develop differently and could in fact become economically prosperous and consequently exert an independent influence on the world. That independent influence could potentially alter the current power structure. As it is, controlling China is out of the question. They have had to make space for China. But they will be damned if India also becomes powerful.

April 2009, “The War and the Circus“, I again wrote about the problem of the global war machine.

Every nation on earth is involved in this insanity, directly or indirectly. The desperately poor third-world nations starve their own people to buy ever more expensive weapons from the advanced industrialized countries. By keeping these nations fighting amongst themselves, the advanced industrialized countries achieve two goals. First, income.

The desperately poor third-world countries pay the advanced industrialized countries for weapons they cannot afford. If one side of a particular conflict involving two desperately poor third-world countries is unable to afford the weapons, the advanced industrialized countries give out “aid” to prop it up so that it does not lose and thereby end the conflict. The other side, to maintain balance, then has to become a paying customer and buy an equivalent set. This is a source of income for the advanced industrialized countries, and more damagingly, a transfer of wealth from the desperately poor to the amazingly prosperous.

The second goal of the advanced industrialized countries (AIC) is the disposal of obsolete weapons. Weapons age and become useless to the original developers. Instead of scrapping them, they are sold to the desperately poor third-world countries. (As the saying in Hindi goes, “आम के आम, गुत्लियो के दाम!”) This provides them the space and the funds required to develop the next round of more expensive weapons — which when the time comes, will similarly be sold to the desperately poor third-world nations.

In effect, to a large extent the poor of the desperately poor third-world countries fund each round of successive advanced weapons development. Of course, the poor of the DPTWC (shortened now since I have repeated “desperately poor third-world countries” enough times to get the idea across) often cheer when their leaders buy these weapons. Their jubilance at what grinds them into further poverty arises out of the same attitude that dragged them into poverty in the first place: an astounding stupidity that is matched only by the immorality of the venal bastards in power.

I should note here that the venal bastards in power (VBiP) are not men of any specific skin or eye color. The VBiP occur in all nations — whether in DPTWCs like India and Pakistan or in AICs like the US and Russia. All these VBiP have their incentives aligned and act accordingly. They are the politicians, the generals, captains of the military-industrial complex, and weapons dealers. They are found in Washington, DC, New Delhi, Moscow, Islamabad, Beijing, and other such fine places that the poor of the DPTWC do not inhabit. The names of the politicians are all over the newspapers and their faces on TVs and magazines: Bush, Clinton, Putin, Manmohan Singh, Sharif, Mugabe, . . . The generals, CEOs of the military-industrial complex, and weapons dealers are not usually household names but they are there from all parts of the world, rich or poor.

Talk of poverty, inequality, development, and such have been all the rage for the past so many years. There are those who are convinced that entrepreneurship and innovation will solve these pressing problems. Some lean heavily on hi-tech gizmos and declare that One Laptop Per Child is the obvious answer to poverty; some others flog the horse of micro-finance mercilessly convinced that it will pull the poor out of poverty; some high-mindedly declare that taxing the rich and re-distributing the proceeds to the poor will be best (whilst all the while handling the money with very sticky fingers); some others believe that the only way out of any problem is killing sufficient numbers of bystanders through suicide bombing in accordance with their religious beliefs; the nuttiest argue that globalization, capitalism, and the market are the real villains and the best way out of poverty is to prevent any sort of industrialization, and so on. The notion that perhaps the poverty of the poor in the DPTWCs is related to the weapons (that the AIC build, operate and sell, and which the powerful in the poor countries so eagerly buy) is not advanced frequently, if at all.

I am conflicted when I consider this issue. Is it the stupidity of the poor, or is it the greed of the rich and powerful that is the primary source of this state of affairs? Perhaps it is a tango and both have to be involved for the dance to happen. Whatever it is, though, it is all karma. Or as they say, you makes your bed, you perforce has to lie in it.

If you are getting tired of reading the same old story, you are not alone. But remember the numbers — the numbers of the desperately poor in the world, and the numbers that speak of the true weapons of mass destruction. Here are some numbers for Pakistan, our friendly neighbor on whom Dr Manmohan Singh often showers “humanitarian aid”, money taken by force from Indians.

The Pakistani-scripted Mumbai terrorist attacks, far from putting Islamabad in the international doghouse, have paradoxically helped open the floodgates of international aid, even if involuntarily. Between 1952 and 2008, Islamabad received over $73bn as foreign aid, according to Pakistan’s Economic Survey. But in the period since the Mumbai strikes, the amount of aid pledged or delivered to Pakistan has totalled a staggering $23.3bn. This figure excludes China’s unpublicised contributions but includes the IMF’s $7.6bn bailout package, released after the Mumbai attacks.

Just last week, Islamabad secured some $5.2bn in new aid at a donors conference — the first of its kind for Pakistan. At that conference, host Japan and America pledged $1bn each, while the EU promised $640 million, Saudi Arabia $700 million, and Iran and the UAE $300 million each. [Source: Fail then reap rewards. Brahma Chellany in the Deccan Chronicle.]

The US is the real dealer in true weapons of mass destruction. The 1987 Nobel Prize winner Oscar Arias wrote in a NYTimes editorial of June 1999: “While the arms industry profits, people throughout the world suffer… the true weapons of mass destruction are the jet fighters, tanks, machine guns and other military exports that the United States ships to non- democratic countries–a record $8.3 billion worth in the 1997 fiscal year, the last year for which figures are available.”

The US behaves like the auctioneer in a “dollar auction”. It is a profitable game for the auctioneer but utterly destructive for the players. India and Pakistan are engaged in a dollar auction. After the Kargil war in 1999, I wrote a piece which I believe explains the nature of the conflict between India and Pakistan, and why it persists. “Dollar Auctions and Deadly Games“:

The dollar auction is a perfect model of the conflict that India faces against Pakistan, with Kashmir being the dollar being auctioned. The bids in this auction are the military expenditure of each nation and the auctioneer is the one who collects the spoils of the military expenditures of the two nations. Since advanced industrialized countries are the major suppliers of arms, they play the role of the auctioneer quite well.

Models are abstractions of the real world and their utility derives from their ability to predict outcomes that obtain in the real world and to the extent that they explain observed behavior, they are useful. Does the dollar auction model explain the observed behavior of the participants of this Kashmir conflict? Consider the motives of the auctioneer in the model. The auctioneer has an incentive to see that the conflict is not terminated. The imminent bankruptcy of one of the participants could end the game. The auctioneer could offer to lend money to the party on the verge of bankruptcy and at the same time encourage the other party to continue with the bidding. The recent IMF loans extended to Pakistan is an instance of this move in the real world that the model predicts. The intervention of the AICs to end the conflict would be parallel to the auctioneer, contrary to his interests, stopping the bidding game. This would not happen in the model and it does not happen in the world it attempts to model. One could be puzzled by the seeming irrationality of the IMF lending money to Pakistan while at the same time the AICs agreeing that India is the aggrieved party. All puzzlement disappears once one notices that this strategy precludes the possibility of the game ending too soon.

The repetition of this depressing tale is unavoidable as long as the US has an economic interest in continued global conflict. The terror is now compounded as the US is now in partnership with global Islamic terrorism. A Faustian bargain if ever there was one.

It’s all karma, neh?

11 thoughts on “The US and its Deadly Faustian Bargain

  1. Pranav Thursday October 21, 2010 / 6:15 pm

    First time ,we are in a situation to dictat our demands when President Obama is in India.If he wants to sell Boing planes and sell American products then first he has to answer few questions.If his answers are not satisfactory , he may have a grand welcome but nothing more.
    Ques 1 : what about the financial aids to Pakistan which keeps the failed state alive and act on as a nuisance to us.
    Ques 2 : What about America’s double standards on the issue of Kashmir.
    Ques 3 : What about the discriminatory VISA fees to our software professionals ?
    There can be many more but these needs to be answered.


  2. larissa Friday October 22, 2010 / 1:55 am

    Actually weapons from the French or other European countries might be better for India. For example, if the purchasing country needs spare parts or anything, sometimes in an arbitrary fashion Congress can decide to deny those parts, so given that obtaining spare parts can be often a problem as has been observed in the past, purchases from the US might not really be a bad thing for the US. I wonder why such considerations are not given importance by those who decide those things?

    What about the discriminatory VISA fees to our software professionals ?
    This is an absurd statement. In this case the US can demand whatever fees it wants, that is its choice. I do not think that India should depend on the US for business so much for anything. The truth is, if India were a powerful country, it would be getting the respect accorded to China. And India not being a powerful country has to do with Indians themselves.


  3. larissa Friday October 22, 2010 / 1:57 am

    I meant to say that purschses might really be a bad thing for India, I wrote instead might “not”


  4. Vishwa Friday October 22, 2010 / 3:52 am

    Why don’t we ask BHO to cancel his visit if these deals are not cancelled? After all, much like Cameron said, they need India more than we need them.


  5. vetti Friday October 22, 2010 / 10:26 pm

    its not as straight forward as that. India and Russia are in a deal to get the PAK-FA aircraft. It will be the mother of all deals when it happens. US may entice india to get things, but India understands its not a reliable seller and go back to russia who has been ready to provide lot of things for India. Now you might ask why should US force India to buy more weapons and whats the point in russia gaining here. The truth is that, you have created a market for selling weapons. Eventually they will get there..


  6. Sumirti Singaravel Saturday October 23, 2010 / 11:34 am

    @Mr.Atanu Dey: Its being quite irksome 2 note those sarcastic and out-of-the-place lines, ”Its all Karma ney!” despite d rational and original arguments u hv poured passionately here. Have read these lines being repeated as the concluding words of many of ur valuable articles. Hope dat I have not intruded in ur religious beliefs.

    Thanks a lot 4 dis blog. Tc.


    • atanu Wednesday September 21, 2016 / 11:06 am

      I sometimes despair at the low levels of literacy of so many Indians. Clearly, they have had opportunities, as can be guessed by the fact that they read blogs, etc. I doubt the commenter above even realizes that her spelling and diction is appalling.

      Anyway, “It’s all karma, neh?” is a signature line that I am particularly fond of. It says that what we suffer is nothing but the consequences of our own stupidity. It also means that we can change the outcome through the right action. Although the concept of karma occurs in the Indic religions, it is universal in application.


  7. larissa Saturday October 23, 2010 / 5:40 pm

    Getting weapons from the Russians for India is also a bad thing these days, considering that the Russians are now unreliable and not like before with respect to India. It is best to consider nations like France, for example to get quality and reliability in case of difficulty of obtaining spare parts…


  8. pankaj Sunday October 24, 2010 / 8:47 am

    weapons will not buy a bit of security to india, and pakistan is well aware of that.we indians are thick skinned,selfish and its not just the politicians but also us collectively, just look at the poor boys sleeping at andheri railway station and then think about the defence budget which does nothing.
    India is a gone case by any standards we have nothing called as empathy for our fellow citizen that is why the poor boys sleeping in andheri.


  9. Dinesh Tuesday November 2, 2010 / 7:52 am

    You will like this. Not so tightly coupled with blogpost. But Jon Stewart does comically mentions the indifference attitude of Americans towards other countries.


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