SocialismToday           Socialist Party magazine

Socialism Today 107 - March 2007

Blair’s BAe arms scandal

THERE WAS a time when Blair was referred to as ‘Teflon Tony’; throw anything you like at him and it wouldn’t stick. Not so now. After the continuing ‘loans for peerages’ scandal and the unprecedented scene of a serving prime minister being questioned in a police investigation, Blair is now in the middle of controversy surrounding corruption charges levelled at arms manufacturer BAe and his decision to wade in and call off the investigations.

The charges against BAe involve a £60 million ‘slush fund’ run specifically to promote defence equipment contracts with the Saudi regime. The slush fund is alleged to have paid for, among other things, cars, call girls and a £2 million three-month holiday for Prince Turki bin Nasser.

The deal being investigated, the Al Yamamah contract, was signed in 1985 under the then Conservative government of Margaret Thatcher and has seen BAe equip, organise and train the Saudi air force at a price of over £43 billion. Corruption has long been suspected around the Al Yamamah deal – a 1992 National Audit Office report has never been released "for fear that it would hurt ‘sensitive international relations’." (The Economist, 2 October 2006) The investigation by the Serious Fraud Office (SFO) into the mass of bribes and dodgy-dealing surrounding the deal has been ongoing since the late 1990s and it seemed that the SFO were making some progress.

But at the end of 2005, a new deal had been signed with the Saudi regime to supply 72 Eurofighter Typhoons along with other military services which is worth at least £6 billion and could be worth more in the long run than the Al Yamamah deal. As BAe chief executive, Mike Turner, stated in 2005: "They [the Saudi leaders] don’t, rightly, like the fact that members of their royal family are being named in our press". (The Guardian, 27 September 2005) So, the Saudi government threatened to cancel the Eurofighter deal.

Blair cited national security interests as the reason for closing down the corruption enquiry but, in reality, the ‘interests’ being served here are those of the fat cats who make billions from selling weapons of mass destruction!

Larry Elliot, economics editor for The Guardian newspaper, commented that the key factor in the geopolitics of the Middle East is Saudi Arabia’s relationship with the US, and that "anything Britain does is a sideshow". He went on to state: "With Britain’s own oil and gas reserves falling, Whitehall has justifiable concerns about energy security. Saudi is the world’s No1 supplier of oil and is too powerful to upset. Given that Russia has the world’s biggest reserves of gas, those expecting the incorruptible British justice system to deliver up the killers of Alexander Litvinenko may be in for a long wait". (18 December 2006)

This strikes at the heart of the matter. Whatever façade of openness and democracy that the ruling class and their political representatives attempt to put across, when it comes to the crunch, business interests and the anarchy of the free market dictate capitalist governments’ policy. Of course, fat cats are corrupt. Of course, dodgy deals go on. It’s only natural for this to be perpetuated by a system based on the creation of obscene wealth for a tiny minority through the massive exploitation of the majority. And for those lining their pockets off the back of our graft, it’s only a problem when such deals, such corruption, become public and undermine their authority.

The international arms trade is notoriously corrupt. David Isenberg, writing in the Asian Times on the BAe investigation, stated, "it brings to mind the line uttered by Claude Rains’ character Captain Renault in Casablanca: ‘I’m shocked, shocked to find that gambling is going on here!’" (6 October 2005) The CIA estimated that, in the late 1990s, 40-45% of all the corruption in world trade stemmed from the arms industry, despite it amounting to less than 0.5% of total trade.

The level of corruption and the nature of the regimes that Britain and BAe are willing to deal with in pursuit of a profit exposes the lie of Bush and Blair’s mission to ‘export democracy’ to the Middle East. Saudi Arabia’s record on human rights is deplorable. A 2003 Amnesty International report stated: "At least seven people, all foreign nationals, had their right hand amputated, and one man had two of his teeth extracted under qisas (retribution) punishment". The Saudi regime oversees the prohibition and repression of political parties, trade unions and human rights organisations. But as an economic and strategic ally, Blair and Bush are willing to turn a blind eye to all this!

In 2005, it came to light that BAe had made payments between 1997 and 2004 to General Pinochet. These payments were to ‘facilitate’ arms and weapons system sales to Chile and other Latin American states. That a company such as BAe was happy to deal with ‘the butcher of Chile’ is sickening, but should come as no surprise, fitting in, as it does, with the general attitude displayed by many representatives of the capitalist class both during Pinochet’s military rule and after his death. As The Economist stated in their obituary to him: "General Pinochet liked to portray himself as the selfless defender of god and country against atheist communism. Some of his friends, chief among them Lady Thatcher, appeared to support this view, ostentatiously taking tea with the doddering old man and stoking him with praise". (The Economist, 16 December 2006)

For the bosses, democracy is by no means a precondition and, when the rule of capital is threatened they are willing to sweep it to one side: "To eliminate communism required ending democracy, which as he [Pinochet] put it later, was ‘no longer able to confront an enemy that has destroyed the state’." (ibid) This attitude among the British ruling class was given theoretical justification in 1977 by Ian Gilmour, who later served in the Thatcher government. He wrote: "Conservatives do not worship democracy. For them majority rule is a device… and if it is leading to an end that is undesirable or is inconsistent with itself, then there is a theoretical case for ending it". (Inside Right)

It seems only natural, then, that the business interests of BAe along with others in the British capitalist class, were put above anything like ‘justice’ or ‘the truth’! But since Blair’s vetoing of the SFO investigation, more allegations of BAe corruption have come to light, including allegations surrounding the sale of air traffic control systems to Tanzania. Considering the international reaction to the dropping of the Saudi enquiry, it is likely that the Tanzanian enquiry will continue. As Larry Elliot put it: "There is a world of difference in getting tough with, say, Ethiopia, over its standards of government procurement, and doing the same with the world’s biggest oil producer". (The Guardian, 18 December 2006) Tanzania is the fifth-poorest country in the world, with GDP per capita of only $600. As such, this enquiry is likely to run its course as a face saving exercise.

But the result of the Saudi affair, along with numerous other corruption and sleaze scandals to have hit New Labour, and Blair in particular, now mean that Blair is seen as damaged goods. A layer of the capitalist class may well now see ‘sleazy’ New Labour as no longer capable of acting as its key representatives and revert to backing an invigorated Conservative Party under Cameron. But whatever the outcome here, parliamentary democracy is a means to an end for big business. The only way forward for the working class and poor, both in Britain and internationally, is to fight for real democracy, for democratic workers’ control and for a socialist society. Through this the resources of the world could be used to provide for the needs of the billions, not to make super-profits for a tiny minority at the top through war, death and exploitation!

Greg Maughan


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