17. ONE OF THE BEST-KEPT CORPORATE SECRETS OF 1981

AWACS, the acronym for Airborne Warning and Control System planes, was one of the biggest headline stories of 1981. And when Congress finally approved the controversial sale of reconnaissance planes to Saudi Arabia we thought it was in the best interests of our country in terms of foreign policy, oil prices, and the need to maintain peace in the Middle East. We were misled.

In reality, the sale was saved from defeat in the U.S. Senate by a massive and unprecedented corporate lobbying campaign which included one of the most successful chain-letter operations in history. And this extraordinary campaign was the result of a successful effort by Saudi Arabia to blackmail U.S. corporations.

Initially, the lobbying campaign was orchestrated by two Saudi officials and three of their U.S. agents. They later were joined by representatives of 40 U.S. companies with aerospace, defense, and petroleum interests. The director of government relations for NL Industries (petroleum equipment and supplies) organized the U.S. corporate lobbying meetings which were held at the Washington offices of the Business Roundtable (the most powerful secret lobby in America and the subject of the 9th "best censored" story of 1979).

One strategy called for the Boeing Corporation (the major AWACS contractor) and United Technologies (estimated to have some $100 million at stake) to send out more than 6500 telegrams to vendors, subcontractors, and distributors asking them, in turn, to contact at least two Senators. An examination of more than 2000 letters sent in by corporate supporters of the AWACS sale showed most of them paraphrased or quoted the original telegrams.

When the race became heated in October, 1981, the Saudis froze virtually all contract awards and renewable negotiations with U.S. firms. U.S. businessmen were led to believe that if the sale did not go through, their deals and contracts would be nullified. In other cases, the promise of contracts were dangled in front of corporations, one corporate official said, "like raw meat before a hungry dog."

Another uncovered part of the AWACS story concerns the final agreement. The Senate approved the sale after President Reagan assured critics that delivery of the aircraft could be stopped if Saudi Arabia did not accept U.S. conditions for their use. On March 1, 1982, Saudi Arabia denied it had signed the agreement calling such reports "baseless" and "lies."

The failure of the media to reveal how American foreign policy was dictated by corporate interests and the President's questionable assurance to Congress qualifies this story for nomination as one of the "best censored" stories of 1981.

SOURCES:

San Francisco Chronicle, 2/5/82, "Massive Lobbying for AWACS told" by Steven Emerson, Copyright 1982 by The New Republic; S.F. Chronicle (UP), "Saudis Deny Signing Pact on AWACS."