Trump’s Arms-Deal Promise Is True, It Will Create Jobs — in Saudi Arabia

In TYT Investigates by TYT Investigates2 Comments

By Naomi LaChance

Although the massive U.S.-Saudi arms deal announced Saturday has been sold by President Trump as a way to create jobs, public statements by military contractors indicate that many of those jobs will not be in the U.S., but in Saudi Arabia.

What’s more, a TYT Politics review of SEC filings by the military contractors involved suggests that in recent years lucrative arms deals have not always translated into new manufacturing jobs.

“That was a tremendous day. Tremendous investments in the United States,” Trump said on Saturday. “Hundreds of billions of dollars of investments into the United States and jobs, jobs, jobs.”

The State Department said the deal is “potentially supporting tens of thousands of new jobs in the United States.”

The State Department did not specify what it meant by “supporting,” and the Trump administration did not say how many jobs would actually be created, or where.

The companies’ public statements indicate that the agreement’s focus is on localizing Saudi Arabia’s defense efforts. The deal is the latest in a long line of U.S. military aid for Saudi Arabia, which has recently fueled the country’s involvement in Yemen’s civil war.

Defense contractors Lockheed Martin, Raytheon, Boeing, and General Dynamics are all involved in the estimated $110 billion deal, the biggest in U.S. history.

The specific agreements, however, suggest that only a scant part of the bounty will turn into manufacturing jobs for blue-collar workers in America.

Lockheed Martin, for instance, will provide Saudi Arabia with a variety of technologies including surveillance systems, missile defense systems, and tactical aircraft. The deal includes a $6 billion agreement for 150 Black Hawk helicopters, but Lockheed Martin says it will manufacture them at its plant in Saudi Arabia.

“Once fully realized, the programs in this announcement will support more than 18,000 highly skilled jobs in the U.S. and thousands of jobs in Saudi Arabia as part of maintaining and modernizing these platforms over the next 30 years,” the company said in a statement.

Boeing CEO Dennis Muilenburg said the deal was “helping to create or sustain thousands of jobs in our two countries.” Boeing did not specify how many jobs it would create in each country.

The agreement, however, focuses on helping Saudi Arabia build its own air force, meaning that much of the work will be done there. The deal creates a new company, the Saudi Rotorcraft Support Company, which will be based in Riyadh and Jeddah.

The deal also provides Saudi Arabia with Chinook helicopters, which are manufactured in Pennsylvania. But the prospect of thousands of new hires there and at other Boeing facilities throughout the country appears to be slim.

While Boeing’s stock soared as Trump’s victory raised expectations of increased defense spending, workers at the Pennsylvania manufacturing plant were expecting layoffs. Boeing laid off workers this year in Washington, where it has laid off a total of 11,000 workers since 2013. From 2014 to 2016, Boeing’s workforce decreased by 15,000 workers, even as its revenues increased from $60 billion to $65 billion.

Lockheed Martin said that the deal will create 450 jobs at its Sikorsky plant in Stratford, Connecticut, providing Saudi Arabia with Black Hawk helicopters. Last year, Lockheed Martin laid off 500 workers, many of them from Sikorsky, at the same location, amid several prior agreements which also involved providing Saudi Arabia with Black Hawk helicopters.

Lockheed Martin’s revenues grew from $4.7 billion to 5.6 billion last year. During the same period, it cut its workforce from 126,000 employees to 97,000.

Raytheon also promised that the deal will bring job creation in both the U.S. and Saudi Arabia. The contractor will provide air defense systems, precision munitions, and cybersecurity. Raytheon’s agreement, however, creates an entirely new subsidiary company — Raytheon Arabia — which will not only be based in Saudi Arabia but will help the kingdom build its own military technology in the future.

General Dynamics — which will help design, engineer, and manufacture armored combat vehicles for the kingdom — agreed to complete half of its work in Saudi Arabia. General Dynamics has not said publicly whether its deal will lead to new job creation in the U.S. As the company has grown, however, it, too, has cut back on its workforce. From 2014 to 2016, earnings increased from $3.9 billion $4.3 billion, but the workforce decreased by 700 employees.

Many American jobs may never materialize from the deal at all, because the dollar amounts are being exaggerated, writes William Hartung, director of the Arms & Security Project at the Center for International Policy: “So what we have is a deal that is mostly a mix of offers already made and promises yet to be kept. And when and if some of the new offers are formally notified to Congress — a process that will at least reveal what systems are to be provided at what cost — there is no guarantee that they will produce signed contracts and actual deliveries of weaponry.”

Hartung compares the Trump deal to a $115 billion Obama-era Saudi arms deal: In the end, the formal agreements actually amounted only to about $20 billion.

The job creation claim has been repeated, though: At The Atlantic, Andrew Exum, a former Pentagon official, argued that the Trump deal will create blue-collar jobs. “And even as progressives fret about U.S. arms sales, they should also fret about what it will mean for the rest of their agenda when Republicans claim credit for protecting some of the last good assembly-line jobs in America,” he wrote.

A 2014 study found that military spending creates far fewer jobs than equivalent spending in other sectors, like education and health care. “Industries such as education and clean energy are more labor-intensive. For a given level of spending, more of those dollars go toward hiring workers and less on equipment and materials. Also, a greater percentage of spending in education, health care, and clean energy construction stays within the US, creating more domestic jobs,” wrote the study’s author, Heidi Garrett-Peltier, an economics professor at the University of Amherst.

Obama’s legacy may be the best indicator of Trump’s fib on military spending and jobs. As military contractor earnings soared and executives received huge paychecks, workers continued to experience layoffs.

What’s more, increased military spending hardly guarantees increased security. Obama Administration sales included cluster bombs, which are banned in 119 countries by international treaty and contributed further to bloodshed in Yemen.

Much of Saudi Arabia’s desire for new weapons relates to its military involvement in Yemen. In 2015, the kingdom led a coalition to back the Yemeni president, Abdrabbuh Mansour Hadi, against the Houthi insurgency, which has ties to Iran. Saudi airstrikes have resulted in thousands of civilian casualties.

The fighting has made it difficult for merchant ships to deliver supplies, exacerbating Yemen’s famine and a cholera outbreak that have left four fifths of the population in need of aid, according to Reuters. Sen. Chris Murphy (D-CT) said that the U.S. should pressure Saudi Arabia to open up a port to allow for delivery of humanitarian aid shipments.

“Yemen is a disaster. It’s a humanitarian disaster, and it’s a national security disaster for the United States. It’s really hard for me to understand why Trump has decided to double down on U.S. support for a civil war inside Yemen that has created enormous space for groups like al-Qaida and ISIS to grow and has resulted in a famine,” Murphy said.

Sen. Rand Paul (R-KY) has said the deal should be subject to Senate approval and is concerned that it may prove detrimental to national security by drawing the U.S. into Yemen’s civil war.

Hartung said, “Rather than touting the jobs created by arms sales to the region while giving U.S. allies a green light to use U.S. weapons however they please, the Trump administration should rethink its support for the Saudi/Emirati-led war in Yemen in general, and the provision of massive arms offers to the Saudi regime in particular.”


  1. its so sickening that we sell cluster bombs and weapons to other countries. Our country being overloaded with weapons isn’t enough… we need to sell to other countries so they can be overrun with weapons too… esp in Saudi Arabia where the majority of the 9/11 attackers came from. Oh well, they arent apart of the muslim ban, they were able to pay their way out of it. He’s doing a tremendous job, really I tell you, what a huuuuge difference he is going to make in this country. We will be reading about president cheeto in our history books just like Hitler and Stalin.

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