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L~E~J ~ ~ ~JiR 11
SALE OF AWACS TO NATO
HEARING
BEFORE THE
COMMITTEE ON
INTERNATIONAL RELATIONS
HOUSE oF REPRESENTATIVES
NINETY-FOURTH CONGRESS
SECOND SESSION
MARCH 18, 1976
Printed for the use of the Committee on International Relations
RUTGERS LA!~' Vru~
~
.~
DO
U.S. GOVERNMENT PRINTING OFFICE
70-832 WASHINGTON: 1976
A'
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CLEMENT J. ZABLOCKI, Wisconsin
WAYNE L. HAYS, Ohio
L. H. FOUNTAIN, North Carolina
DANTE B. FASCELL, Florida
CHARLES C. DIGGS, Ja., Michigan
ROBERT N. C. NIX, Pennsylvania
DONALD M. FRASER, Minnesota
BENJAMIN S. ROSENTHAL, New York
LEE H. HAMILTON, Indiana
LESTER L. WOLFF, New York
JONATHAN B. BINGHAM, New York
GUS YATRON, Pennsylvania
ROY A. TAYLOR, North Carolina
MICHAEL HARRINGTON, Massachusetts
LEO J. RYAN, California
DONALD W. RIEGLE, Ja., Michigan
CARDISS COLLINS, Illinois
STEPHEN J. SOLARZ, New York
HELEN S. MEYNER, New Jersey
DON BONKER, Washington
GERRY E. STUDDS, Massachusetts
WILLIAM S. BROOMFIELD, Michigan
EDWARD J. DERWINSKI, Illinois
PAUL FINDLEY, Illinois
JOHN H. BUCHANAN, Ja., Alabama
J. HERBERT BURKE, Florida
PIERRE S. Du PONT, Delaware
CHARLES W. WHALEN, Ja., Ohio
EDWARD G. BIESTER, Ja., Pennsylvania
LARRY WINN, Ja., Kansas
BENJAMIN A. GILMAN, New York
TENNYSON GUYER, Ohio
ROBERT J. LAGOMARSINO, California
MARIAN A. CZARNECKI, Chief of Staff
JOHN H. SULLIVAN, Senior Staff Consultant
MARY JANE ARIsoN, Staff Assistant
COMMITTEE ON INTERNATIONAL RELATIONS
THOMAS E. MORGAN, Pennsylvania, Cli airmasv
,(II)
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CONTENTS
WITNESSES
Lauenstein, Lt. Col. Karl, U.S. Air Force, Acting Special Assistant to the Page
Director, Defense Security Assistance Agency 18
Rosenthal, Hon. Benjamin S., a Representative in Congress from the State
of New York 1
Winn, Hon. Larry, Jr., a Representative in Congress from the State of
New York 5
(III)
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SALE OF AWACS TO NATO
THURSDAY, MARCH 18, 1976
HOUSE OF REPRESENTATIVES,
COMMITTEE ON INTERNATIONAL RELATIONS,
Washington, D.C.
The committee met at 10:45 a.m., in room 2172, Rayburn House
Office Building, Hon. Thomas E. Morgan (chairman) presiding.
Chairman MORGAN. The committee will please come to order.
The committee has before it today for consideration House Con-
current Resolution 576 which pursuant to section 36(b) of the Foreign
Military `Sales Act would disallow the proposed sale of 32 airborne
early warning aircraft to the North Atlantic Treaty Organization.
On February 27 the committee received notification from the De-
partment of Defense of the proposed sale of the airborne early warning
aircraft to NATO. Because this is a matter within the budget of the
Department of Defense, the Armed Services Committee has been con-
sidering U.S. procurement of the airborne early warning aircraft.
On March 17 the Armed Services Committee reported out H.R.
12438, a provision of which prohibits the spending of any funds on
procurement of these planes until a favorable decision by NATO to
purchase these planes.
On March 8 Congresswoman Patricia Schroeder introduced House
Concurrent Resolution 576 disapproving the sale to NATO.
On March 10 the resolution was referred to the Subcommittee on
International Political and Military Affairs. The subcommittee held a
hearing on `the proposed sale on March 11 and the chairman of the
subcommittee requested the chairman of the full committee to convene
the full committee to receive the subcommittee's report.
REPORT BY CONGRESSMAN ROSENTHAL
I will now call on Congressman Rosenthal to report to the commit-
tee on this matter.
STATEMENT OP HON. ]3ENJAMIN S. ROSENTHAL, A REPRESENTA-
TIVE IN CONGRESS PROM THE STATE OP NEW YORK
Mr. ROSENTHAL. Thank you; Mr. Chairman.
Due to the absence of Mr. Fascell I chaired the hearing that con-
sidered this matter and with his permission I make the following
report.
As you correctly stated, both Mrs. Schroeder and Mr. Downey filed
resolutions of disapproval on the proposed sale of 32 airborne early
warning aircraft to the North Atlantic Treaty Organization. In com-
mon parlance these aircraft are called AWACS, A-W-A-C-S.
(1)
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2
CONGRESSIONAL OPPOSITION
I want to briefly summarize the testimony that was offered before
the subcommittee. The burden of Mrs. Schroeder's argument was,
should the United States subsidize the sale of very expensive aircraft
to our NATO allies in order to make the sale? In other words, she
said that the aircraft was extraordinarily expensive and that we would
be subsidizing it by selling it to them at a significantly lower price than
in fact it cost to produce if you take into account the research and
development costs.
She also suggested that the Department of Defense is attempting by
the proposed notice of sale to create a false impression that NATO is
prepared to buy these airplanes when in fact the NATO defense minis-
ters have not yet considered the matter and will consider this proposed
sale sometime at the ministerial meeting in May.
Mr. Downey's testimony cited both DOD evidence and Armed
Services and Appropriations Committee reports. He has gained some
degree of expertise in the methodology and use of this airplane and he
said that DOD had changed the AWACS mission a number of times.
Mr. Downey said that in order to sell the plane to a rather dubious
NATO, DOD wanted what we can only describe as a double subsidy;
one, in research and development costs, most of which the United
States pays, and then additionally because the United States would
pay 25 percent of the participation in NATO funding. We would be
picking' up the tab twice using what he described as a double dip. He
suggested that NATO should pay about $950 million of the total
Tesearcil and development if they want this airplane and that DOD
-wants them to pay only $150 million of this R. & P.
Downey also said that the. Defense Department planned to buy at
`one time 42 AWACS at a then estimated cost of about $63 million
apiece but so far he said DOD has spent more than $180 million per
plane to put 13 working aircraft into the U.S. inventory. The GAO
stated in a February 27 report on the financial status of major ac-
quisitions that the United States would have to buy another 19
AWACS at a cost of over $1 billion to bring the unit price below $110
1million per plane.
TESTIMONY OF GENERAL FISH
General Fish testified that NATO has studied the AWACS question
-for several years and that they concluded the Boeing modified 707
is the best plane for the very urgent defensive need of detecting and
tracking enemy aircraft. The AWACS plane is a Boeing 707 with a
huge radar bubble on top and presumably it is very useful in front
line interdiction of enemy planes and enemy signals and that sort of
thing.
General Fish said that the NATO military people had asked for the
proposed letter of offer. During the course of the inquiry it developed
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3
that the NATO military group generally was in favor of purchasing
the AWACS and presumably would recommend to the ministerial
meeting in May the purchase of the AWACS.
General Fish said that pursuant to the NATO military finding
that they wanted this airplane that the Defense Department was sub-
mitting this notification. General Fish said that the intention of the
Defense Department was to conform with congressional desire to in-
form in advance on major arms sales because there is some question as
to the number of planes-and I will get to that later-that NATO will
in fact purchase.
Because there is some question as to the precise price General Fish
said, in essence, even though we are in an imprecise position we are
trying our best to give you the best information available. He said
that we do not know what the final cost will be except that the cost of
the airplanes will be $2.2 billion or less. He also said that we do not
know how many planes NATO will buy simply because the defense
ministers have yet to meet. He also said that this is a very complex
negotiation with many countries involved and that is why at this early
stage one does not know what the precise order or sale will be. He
also said that the NATO purchase will lower U.S. unit costs of its
own AWACS plane by having NATO pay 4 percent of each plane's
cost as its share of the research and development costs.
Senator Thomas Eagleton of Missouri also testified in support of
the resolution of disapproval. He said essentially that the notification
under section 36(b) is an extra legal attempt to get tacit congressional
approval of a proposed sale without adequate information or details
being available to Congress to judge the case on its merit. He also said
that it is highly questionable that NATO will ever buy these planes
and he also said that no NATO country and no NATO defense min-
isters meeting has agreed to buy the planes as of now.
REPORT OF THE HOPSE APPROPRIATIONS COMMITTEE
Mr. Chairman, additionally complicating the issue, and it was kind~
of intriguing, is that the House Appropriations Committee considered
this matter and the committee summarized previous budgeting for
AWACS which it describes, and I quote from the House Appropria-
tions Committee report, "not only the most expensive aircraft bought
by the Air Force but one of the most controversial."
After reviewing the changes in Air Force justification for AWACS
in the past, the committee stated as follows in its report, and I read
from the House Appropriations Committee report.
It would appear from the foregoing that the Air Force is determined to buy
34 AWACS aircraft regarcTless of the fact that the mission's priority has been
changed and that NATO may buy aircraft- to support the NATO requirement.
This attitude seems to express a wanton disregard for economy. It is apparent
that if the primary mission of AWACS is to support tactical forces, then the re-
quirement can be reduced. It is also apparent that if most of the 34 aircraft are
justified to support the NATO mission and NATO is willing to buy aircraft to
support that requirement, then the number of aircraft purchased by the U.S.
can be reduced accordingly. It is far more economical for the Government to pay
25 to 30 percent of the cost of AWACS aircraft in NATO than buy 34 aircraft
for the armed services.
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REPORT OF THE ARMED FORCES COMMITTEE
The Armed Forces Committee, Mr. Chairman, also considered this
matter, and I read to you from their report dated May 10, 1975:
Connnittee action on this program was further complicated by the revelation
of a proposal which is being considered within the Department of Defense to sell
to our NATO allies the AWACS aircraft for approximately 50 percent of the
cost to *the United States Air Force. After a thorough airing of this proposal
the committee directs that the Department of Defense take no action toward the
consummation of any agreement with any foreign government relative to the sale
of AWACS until the expiration of 30 days `after a full report of the terms and
conditions proposed for such sale have been reported to the Committee on Armed
Services of the Senate and House of Represenlatives.
The notice of sale, Mr. Chairman, which I think the members have'
before them, says, "The total estimated value of the sale is $2.2 bil-
lion," and under item C it says, "Description of services or services
offered, 33 airborne, early warning aircraft (spare pares and support
equipment) ."
LANGUAGE OF SECTION 36(b)
Now section 36(b) notices are referred to this committee and in the
law it says as follows:
For each letter of offer to sell under paragraphs 1 and 2 the report shall specify
(a) the foreign country or international organization to which the defense article
or service is offered; (b) the dollar amount of offer to sell under paragraph 1 or
of the completed sale under paragraph 2, a brief description of the defense article
or services offered, the United States armed force which is making the offer to
sale, the date of such offer and the date of any acceptance under paragraph 2.
Even though the notice of sale says 32 aircraft at $2.2 billion, at a
press conference the public relations spokesman for the Department
of Defense publicly amended the notice of sale by saying that it would
be "up to" 32 airplanes and "up to" $2.2 billion.
My own view of how we should handle this matter, Mr. Chairman,
is that we should refrain from getting into the subject matter of the
merits of the airplane. There are an awful lot of experts that have
varying opinions as to the efficacy, the validity, the usefulness, the
cost of this particular airplane.
I also think that we should defer to the Armed Services Committee
as to the merits of the airplane and we should not intervene in their
process as to whether or not the 30-day notice required of proposed
sale is valid or invalid. I do think that the mission of this committee
is to protect the integrity of our responsibility under section 36, and
considering that responsibility it is my view that the notice of sale is
defective because they have publicly stated that the total estimated
value is not what the value will be and the number of aircraft is not
what the number will be and there is not a clear and present purchaser
available at the present time.
DOD NOTIFICATION OF INTENT
General Fish said that the Department of Defense in its zeal to be
forthcoming with this committee sent .a notification of intent to issue
a letter of offer trying to put the Congress in on the ground floor.
Both Mr. Downey and Senator Eagleton suggested that there were
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ulterior motives in this notification and that they were proposing to
use the letter of offer and the tacit approval of Congress as a tool in
the proposed salesmanship to be used at the ministerial meeting.
I have no opinion and would not suggest we get into that dispute.
What I do think the committee ought to do today is recognize that the
notification of the proposed letter of offer is, at the least, premature
and secondarily technically defective in that it is imprecise simply
based on the testimony of General Fish. Also, the time has all prac-
tically run out on Mrs. Schroeder's letter of disapproval and we would
not want to get into the merits of the case.
I am going to yield to Mr. Winn shortly. I would suggest that we
lay on the table Mrs. Schroeder's and Mr. Downey's resolution of dis-
approval and that we adopt a committee resolution which would say
that the committee would request the President when they have in `fact
a large customer, a real sale, to send up a new notice of offer with a
precise amount of dollar sales volume and a precise number of sales.
Mr. Chairman, in order to make any kind of evaluation, one must
know the precise number so that you can then project out what the
cost is and to what extent the United States is subsidizing the thing.
You really cannot do that at this time; it is far too premature. I would
suggest two things we do is-Mr. Winn would offer that motion-lay
on the table the concurrent disapproval resolution. Then I would
offer the committee resolution merely requesting the President to send
up a new letter of offer.
I prefer to yield to Mr. Winn at this moment.
Chairman MORGAN. Yes, sir.
STATEMENT OF HON LARRY WINN, 1R, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW YORK
Mr. WINN. I thank you very much.
As Mr. Rosenthal said, he was chairing the subcommittee meeting
for Mr. Fascell. The hearings went on for a little over 4 hours. I
believe the record will, show I am the only member of the subcom-
mittee that was there for the entire 4-hour period of time.
NATO AND AWAOS
It is kind of hard to understand how this resolution could come
forward since Mrs. Schroeder is on the Armed Services Committee
but it was also pretty obvious that we had quite a number of experts
on airplanes and the desires and the needs of the Air Force, and
particularly we had great expertise on what NATO should decide
that they would want.
Now I would like to point out that General Fish brought out in
the testimony that NATO had been talking and discussing and con-
siderimr the AWACS airplane and other possibilities, one of which
is being built in Great Britain, and he brought it to our attention, too,
that. the Department of Defense does have a request from NATO
to uroceed with a memorandum of understanding.
One thing that I would like' to point out, I don't think that it is
up to this committee and I will agree with my colleague from New
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6
York, Mr. Rosenthal, that the subject matter on the usefulness of the
airplane does not come within the jurisdiction of this committee or
our subcommittee. We spent most of our time listening to variations
of opinions on various airplanes. I am convinced, Mr. Chairman, that
NATO has asked the Department of Defense for a memorandum of
understanding so that they could proceed with the purchase of the
AWACS airplanes.
Now Mr. Rosenthal questions the legality of the notification dealing
with section 36(b) and I can't argue with that. I feel that if what
the Department of Defense did at this time is illegal, then I feel that
we have on record last year and this year probably another 71 notifica-
tions to this committee and to the Armed Services Committees which
might be illegal. That will have to be up to the members of the com-
mittee and the other committees to decide.
A MOTION TO TABLE RESOLUTION
I will at the right time present a motion to table. The time for
Mrs. Schroeder's resolution is about up and I feel in good faith that
General Fish and the Department of Defense will present to this
committee, as they have done in the past at our request, the informa-
tion necessary on the start of a sale by the NATO countries.
I would like to just add one thing and this is from a letter from
General Fish to Frank Slatinshek, chief counsel of the Armed Serv-
ices Committee, February 27, 1975. He says:
The proposed sale of the E-3A airborne early warning aircraft in NATO would
not only enhance U.S. readiness posture but will also have the most favorable
effect on the U.S. Air Force AWACS program through a portion of the recovery
of the R&D costs and by lowering unit production costs.
Now we discussed this for quite some time in the subcommittee and
it is hard to really pinpoint how you are going to recover those R. & D.
costs until you make a first sale. I am again quoting from the program
here. It says:
Total system acquisition and management of the AWACS program and the use
of the Government furnished equipment in the E-3A aircraft dictate that this
proposed transaction be handled as a Foreign Military Sales case.
Again from the letter.
The addition of this aircraft to the NATO forces would markedly increase
their early warning capability.
Now this is from the Department of Defense. I think they are sold
on it. I think the NATO countries are sold on it and I want to give
them a chance to find out. The last paragraph says:
The customer NATO, which includes the U.S. as a member will be charged
all costs incurred in providing the articles and the services for this case plus
an FMS administrative service charge. While the specific industrial participa-
tion by individual member countries has yet to be determined, it is anticipated
that the proposed sale would have a positive net effect on the U.S. balance of
payments.
Mr. Chairman, at the right time I will offer a motion to table but
I know there are some other members that would like to be heard.
Thank you for yielding, Mr. Rosenthal.
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7
ARMS SALES TO NATO?
Chairman MORGAN. Mr. Bingham.
Mr. BINGHAM. I thank the gentleman for yielding and I certainly
agree with him and compliment him on the work he has done on this.
It seems to me this is what was intended under the procedures laid
down in 36(b) and I would like to ask this particular question. I may
be wrong about this but my impression is that we don't sell military
equipment to NATO as such: We sell it to individual countries that
are members of NATO. Therefore, to put the prospective purchaser
down as NATO is a meaningless generality which does not comply
with the requirements of the section. Could the gentleman comment
on that?
Mr. ROSENTHAL. In all candor section 36(b) does permit a sale to aim
international organization such as NATO.
Mr. BINGITAM. I realize it permits that but my impression is that
NATO does not have funds for this type of purchase, that the funds
come from the individual countries and that the sales are made to the
individual countries within the NATO structure.
Mr. ROSENTHAL. I think the gentleman is correct.
THE AIR FORCE AND AWACS
Chairman MORGAN. Mr. Harrington.
Mr. I-IARRINGTON. Your colleague is asking that we table it and then
pass a resolution requesting that the A~r Force, when it has a specific
customer, return to this committee. Will that have the effect of negat-
ing the sale?
Mr. ROSENTHAL. I am trying to take a very clearcut middle ground
in this. There is no customer at the present time. There are negotia-
tions going on. I asked General Fish:
Do you propose to sell 1, 2, 3 or how many?
He said:
We are asking permission to sell 32. However the negotiation, as often hap-
pens in these cases, comes out to be some lesser number. If we exceed the num-
ber, we have to come back to Congress.
There is no sale, there is not in fact a customer. There is a recom-
mendation, I believe, by the NATO military group to the Council of
Defense Ministers that a sale be made. After that group meets, as
Mr. Bingham has suggested, there will be negotiations with individual
countries perhaps as to number and to price.
Mr. HARRINGTON. My question still is what is the practical effect of
what you suggest we do? Will it prevent the Air Force from going
forward at this point?
Mr. ROSENTHAL. I don't know. Laying the resolution on the table,
which Mr. Winn will do and which I agree to, permits this notifica-
tion and this letter of offer to stand. What I am suggesting so that
we maintain the integrity of the 36(b) process is that this committee
also adopt a resolution that I will offer that calls on the President to
send up an appropriate notice at an appropriate time when there is a
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8
live customer with the specified amount. Even that in all candor does
i~ot have the effect of law, it. is merely a request. I am hopeful that
the aclrnimstration in respect to the. integrity of the process and the
concern of this committee will compl~ with the request.
Mr. WOLFF. Will the gentleman yield?
Mr. ROSENTHAL. Yes.
SUPPORTS TABLING OF RESOLUTION
Mr. WOLFF. I want to concur with the statements of the gentleman
from New York and the gentleman from Kansas on the question of
laying this resolution on the table at the moment. However, I think
it must be understood that this is clone without prejudice to the rights
and responsibilities of this commitee in future actions. As I under-
stand the law as it exists today, we are not. responsible for the actual
merits of the particular systems that are involved but the foreign
policy implications that ensue from a military sale. On that basis, I
believe as a result of the confusion that has existed as to the . merits
or demerits of this aircraft that we should postpone our decision on
this until this has been established.
Mrs. MEYNER. Will the gentleman yield?
Mr. ROSENTHAL. Sure.
CONGRESSIONAL POSITIONS ON AWACS
Mrs. MEYNER. Mr. Rosenthal, you were at that meeting. Was it your
impression that Mrs. Schroeder is not opposed to the manufacture or
the sale of AWACS, she is just opposed to the United States so heavily
subsidizing it?
Mr. ROSENTHAL. I think that is a fair statement. Mrs. Schroeder's
position was that she objects to the United States selling it to NATO
at a cutrate bargain basement price and to double that by paging one
quarter of the unit cost in addition, what was referred to as a double
dip. In other words, we are reducing the cost per unit and we are also
subsidizing it by picking up 25 percent of the NATO thing.
Now of course the more you sell of the planes and regardless of to
whom you sell, you reduce the per unit cost. Mr. Downey had a some-
what different point of view. He had serious questions about the tac-
tical use of these planes over the United States but conceded that they
might be useful in Europe. It was also brought out that in and around
Mr. Downey's district Grumman Aircraft makes a less expensive
model of the AWACS which costs about 25 percent but Mr. Downey's
addressing himself to that issue should in no way complicate our view.
We have, in my judgment, a very narrow responsibility pursuant to
36(b) and we should stay away as much as we can from the merits or
the uses or the technical weaponry or the expertise factors as Mr. Winn
talked about.
Mrs. MEYNER. Thank you. . . ~. . . .
UOW MANY AWACS IN SALE?
Just one final question. Why the arbitarary figure of 32, or isn't it
arbitrary?
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Mr. ROSENTHAL. That is the problem. They would like to sell 32 and
they don't have any customer for 32-as a matter of fact, they don't
have a customer. General Fish said that 32 was a number that they
would like to sell; they may sell less than that. They may cost less than
that. That is precisely the point I made, that the letter of offer is tech-
nically prima facie. defective if it does not with a high degree of pre-
cision name the customer, name the amount. As a matter of fact, under
the law the notice of offer is required to state the date of any accept-
ance under paragraph 2.
Now, as Mr. Winn alluded to, I think they have been less than tech-
nically responsive on some other letters of offer but other letters of
offer have not been challenged. This is the first time we have hac[ to
meet this challenge and I am trying to find a way to meet it within a
meritorious sense of our responsibilities.
Mr. `WOLFF. Would the gentleman yield?
Mr. ROSENTHAL. I yield to Mr. Wolff.
Mr. WOLFF. Le.t me rise in defense of my colleague from Long Island
who, I think, is not simply holding to the provincial view of looking
out for aircraft just from his district, but is, I am sure, looking out for
the best interests of our country. I think that should be on the record
plus the fact that I think it is important as well t.o understand that
these figures that are being bandied about include R. & D. costs, and
the R. & D. costs are not the actual cost of the aircraft involved. If yOu
are going to start to talk about a $2.2 billion cost to include the R. & D.
cost, you are not talking about the cost of the aircraft itself.
Mr. ROSENTHAL. Let me correct one thing. Staff has advised me, Mr.
Bingham, that there are some instances where NATO is the owner and
purchaser of some military equipment. That is what I am told by the
staff.
LOCATION OF AWACS MANUFACTURE
Chairman MORGAN. Mr. Rosenthal, where is this plane going to be
manufactured? Are we talking about competition from New York?
Mr. ROSENTHAL. I didn't want to necessarily bring that up. [Laugh-
ter.] I `think Mr. Downey's position was that he was opposed to the
double dipping regardless of who was involved. I think that is a fair
representation of his position.
Where is this manufactured? I don't know.
Where is this plane manufactured? Boeing, Seattle?
Mr. HICKS. They make the AWACS.
Mr. ROSENTHAL. Equipment for both of the planes are made in Mr.
Downey's district. `The AWACS plane is made in Washington. and
that is why we are honored to have Mr. Floyd Hicks with us this
morning on this committee. ` ` .
Mrs. MEYNER. We should ask Mr. Wolff and Mr. Downey if they
would let AWACS make an emergency landing at Kennedy.
[Laughter.]
Mr. ROSENTHAL. Would the gentleman yield?
Mr. WOLFF. I would be delighted to have the aircraft not oniy land
but to be used in a control mode for Kennedy which suffers very badly
from problems with air traffic control at the present time.
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10
Mr. ROSENTHAL. Even thôtigh I was told that this is a B'c~ing' air-
plane, it would be made generally where Boeing makes their airplanes.
I understand both in Wichita, Kans., and out in Seattle, Wash., there
would be European components used and that is one of the areas under
negotiation which would affect the cost of the unit is how much would
be made here and how much would be made there.
ARMS PURCHASES BY NATO
Chairman MORGAN. Mr. Bingham.
Mr. BINGHAM. Since I raised my question earlier I have also had
some information from the staff. I believe it is true that some pur-
chases have been made by NATO but not of this type of equipment.
As far as I know, no purchases of aircraft;, for example, have been
made by NATO. While conceivably this purchase could be made by
NATO, I think the gentleman's point is that no purchaser is identi-
fied in this letter of offer. This might be a NATO purchase or it might
be one by several countries and therefore his point that it is too vague
~n the notice to satisfy the requirements of 36(b) is perfectly valid.
Mr. WHALEN. Mr. Chairman.
Chairman MORGAN. Mr. Whalen.
Mr. WHALEN. I thank the gentleman for yielding.
I don't want to seem indelicate but I think that we should perhaps
go a little more deeply into this competitive question. The Congress
was treated several months ago to the spectacle of an industrial firm
trying to block approval of a naval aircraft because that particular
firm `did not receive a contract, and I would hope that that is not the
case in this situation. I was rather impressed by the witness list and
I wondered if you could elaborate on the St. Louis connection. Is
~cJ)onnell-D0ugla5~ for example, interested in this?
Mr. ROSENTHAL. I don't know. I would urge all of us to try to stay
away from these other complicating factors. I think we have a narrow
area of interest and that is maintaining the integrity of the 36(b)
process. I think, as Mr. Bingham has so appropriately suggested~ the
letter of offer is defective in terms of the name of the customer and in
the amount, but mostly it is premature. There is really not a customer
and letters of offer should not be used. If, albeit, that is the case, it is a
promotional weapon saying that Connress approves the sale. Letters
of offer should be used as a responsible vehicle for notifying Con-
gress of the sale when in fact there is a clearcut sale and a clearciit
purchase and that includes numbers, amount.
Chairman MORGAN. Mr. Rosenthal, will you yield to Mr. Bonker.
I hope we can recognize Mr. Winu for his motion after Mr. Bonker
is through.
THREE ISSUES INVOLVED IN THE RESOLUTION
Mr. BONKER. Yes; Mr. Chairman.
I would' just like to say there are three issues involved in this resolu-
~tion. One concerns the merits of AWACS as a viable defense system,
and I have already reached a conclusion on .that question and voted
earlier against AWACS the second is the circumstances surrounding
PAGENO="0015"
11
the proposed sale to either NATO or to other countries who are con-
sidered our allies. Third, of course, is section 36(b) and the commit-
tee's role in this procedure.
Now Mrs. Schroeder has stated, or at least she is on record in the
subcommittee as taking the position against the subsidized sale of this
system to NATO and question whether or not the sale itself is firm.
As I understand, the Armed Services Committee has taken action to
withhold the sale until after 30 days in which all the pertinent infor-
mation relevant to the sale has been submitted.
Now I think it would be unfortunate for this committee to invoke
the provisions of 36(b) for the first time on sales to our allies. It was
my impression that the provision was in the Nelson amendment which
was enacted earlier to place an overall lid on arms sales, mostly to the
Persian Gulf, so that we could get a handle on the large volume of
sales to these countries. Even though this committee has taken action
before on the sales to Jordan of Hawk missiles, we have never really
approved a concurrent resolution of a denial of sales to any country,
and I would not like to see this committee really assert itself on a
particular sale to our allies. Therefore, I will support the Rosenthal
substitute and call upon the President to revise the statement with
respect to the proposed sale.
Chairman MORGAN. Mr. Winn.
NATO PURCHASING "UMBRELLAS"
Mr. WINN. Thank you, Mr. Chairman.
Before I make the motion to table, and I will do so very shortly, I
would like to clarify a point that Mr. Bingham brought up about
NATO not being a customer. He is right, NATO as such is not a
customer, but there are umbrellas under which NATO has been
purchasing for many, many years. One organization is called NAMSA,
another one is called JACMO. They get all kinds of clever names. I
don't know what this stands for but this is not an unusual thing.
NATO itself cannot enter into a contract, they have to go back to the
NATO council just like Mr. Rosenthal said. I did want to clarify it
that we have sold arms before-maybe not airplanes but other types
of arms.
Mr. FRASER. Would the gentleman yield?
Mr. WINN. I will yield to Mr. Fraser and then I want to make my
tabling motion.
DEFECTS IN 36(b) NOTIFICATION
Mr. FRASER. I intend to support the gentleman's motion to table. I
just wanted to make the statement that when we considered the sale
of hawk missiles to Jordan we urged an agreement to get earlier
rather, than later notice of proposed sales in the case of weapons and
by the time we got notice the matter had progressed so far that it
involved political problems fo.r us to. act affirmatively on a resolution
of disapproval.
I make that point because I would not want our action today to be
construed as overlooking our interest in early notification. I would
hope that the action today, including the adoption of Mr. Rosenthal's
PAGENO="0016"
12
committee resolution would be limited to the facts here. First that
apparently NATO is not the purchaser.
Second, there is no date of an offer. This notice is technically
deficient, it has the date of the notice to Congress but not the date of
the offer. In that sense there is not strict compliance with the statutory
requirements but I don't think we would want to give the impression
that we want to wait until the deal is all wrapped up.
Mr. BINGHAM. Would the gentleman yield?
Mr. WINN. Twill be glad to yield.
NEED FOR CONSULTATION
Mr. BINGHAM. I think the point that was made in connection with
the Jordan matter was that we wanted some preliminary consultation
before a notice of offer was filed and that is certainly consistent with
what we are doing here. What we are quarreling about here is that a
formal transmittal notice of intent to issue a letter of offer was filed
which starts the clock running and that is not at all what we had in
mind. We had in mind the DOD promise that they would in similar
cases in the future have consultation before a notice of offer has been
submitted and that in fact has been what has been done with respect
to the proposed sales to Egypt. So I don't think that quarreling about
this procedure in any way negates the motion. We would like to be
kept informed as far in advance as possible of the proposed deal.
Mr. WINN. I thank the gentleman for his information. It is pretty
obvious that when you come on this committee and we request these
offers to purchase and memorandums from the Department of Defense
that it is hell if you do and hell if you don't as far as timing is con-
cerned with them trying to meet the requests of this committee.
MOTION TO TABLE RESOLUTION
Mr. Chairman, I offer the motion to table House Concurrent Resolu-
tion 576.
Chairman MORGAN. All in favor of `the motion of the gentleman from
Kansas `indicate by saying the word aye; all opposed no.
The motion is carried.
Mr. ROSENTHAL. Mr. Chairman.
Chairman MORGAN. Mr. Rosenthal.
COMMITTEE RESOLUTION PROPOSED
Mr. ROSENTHAL. Mr. Chairman, pursuant to the dialog we just had
I offered a resolution and asked that it be distributed. I think it may
have been distributed and I don'~t think I need the 5 minutes. I think
I have adequately discussed it and I would hope the committee will
accept it.
Chairman `MORGAN. Mr. Rosenthal, we will have the clerk read the
resolution.
Mr. CZARNECKI [reading]:
PAGENO="0017"
13
RESOLUTION OFFERED BY REPRESENTATIVE ROSENTHAL
Whereas the Committee on International Relations of the House of Repre-
sentatives finds that it does not have sufficient information with which to fulfil
its responsibilities under section 36(b) of the Foreign Military Sales Act with
respect to proposed sale to the North Atlantic Treaty Organization of E-3A
Airborne Early Warning Aircraft, described in the statement submitted by the
Presi(ient on February 27, 1976 (transmittal number 76-41) : Now, therefore, be it
Resolved, That the Committee on International Relations of the House of
Representatives requests the President to submit a revised statement with re-
spect to the proposed sale described in the preamble of this resolution when more
specific information concerning this proposed sale is available.
Sec. 2. The Committee has made no judgment with respect to this proposed
sale and will consider a new submission with respect to this proposed sale with-
out prejudice.
Sec. 3. The Committee recognizes that our relations with our allies of the
North Atlantic Treaty Organization are of the highest importance to the United
States and, accordingly, will follow, with interest, the progress on negotiations
concerning the proposed sale of E-3A Airborne Early Warning Aircraft to such
Organization.
Chairman MORGAN. Mr. Rosenthal.
EXPLANATION OF PROPOSED COMMITTEE RESOLUTION
Mr. ROSENTI-IAL. Mr. Chairman, I think we have said all that needs
to be said. I think the responsible way for maintaining both the in-
tegrity of this committee and the integrity of the process is this com-
mittee resolution which is a request, and I think the President would
be wise to follow that.
Mr. WOLFF. Would the gentleman yield?
Mr. BINGHAM. Would you yield?
Mr. ROSENTHAL. I would be happy to yield to Mr. Wolff.
Mr. Wor~'i~'. I thank the gentleman for yielding.
I take this time only to ask Mr. Bingham a question.
Did you say that there was notification of the Egyptian sale of
aircraft?
Mr. BINGHAM. No; I said quite the contrary, that the administration
has been in the process of informally consulting with Congress on pro-
posed sales to Egypt before the submission of any proposed notice of
offer which is what we have wanted them to do. So I think this pro-
cedure which involves a premature filing of a proposed letter of offer
does not give us the kind of advance notice that we want. We have
had commItments from DOD that they would try to have advance con-
sultation on proposed sales that they consider may be controversial
before they actually submit the notice and that is what they have been
doing.
Mr. WOLFF. SpecificaJly on the question of the Egyptian aircraft, has
the gentleman received any informal information on this other than
what he has seen in the newspapers?
Mr. BINGHAM. Certainly. The representatives of the State Depart-
ment have discussed it with me but there has been no notice of offer
filed.
Mr. WOLFF. I thank the gentleman.
Mr. ZABLOCKI. Would the gentleman yield?
Mr. ROSENTHAL. Yes.
PAGENO="0018"
14
PROPOSED AMENDMENT TO COMMITrEE RESOLDTION
Mr. ZABLOCKI. I am about to ask the gentleman from New York.
since the law requires that each letter of offer be referred to us, whether
he would amend his somewhat tight resolution to re.fer not just to a
`~proposed sale" but to amend it to say "offer of sale"? That would be
on line 5 in the whereas clause and in line 3 of the first resolved, on
lines 2 and 3 of section 2 and the second to the last line in section 3.
Wherever you refer to a "proposed sale," in order to comply with the
law to refer to an "offer of sale."
Mr. ROSENTI-JAL. Am I correct-
Mr. BINGHAM. Would the gentleman yield?
Mr. ROSENTHAL. yes.
Mr. BINGHAM. This raises a point that I wailted to discuss before
because I think really there has been some confusion about section 36
and the relation between section 36(a) and 36(b). I think the wording
of the resolution as it stands is correct. If the committee would refer to
36(b), what is anticipated there is that the President submits a pro-
posed letter of offer.
The letter of offer has not been sent, he is submitting a proposed let-
ter of offer and it does not go until after the 20 days have elapsed with-
out a veto. Therefore, the comments that were made before by the gen-
tleman from New York, if I may have his attention-Mr. Rosenthal,
I would like your attention a moment because you referred a couple of
times-
Mr. ROSENTHAL. I am told the legislative counsel does not see any
substantive differences in either approach.
MEANING OF SECTION 36(b)
Mr. BINGHAM. Let me just make the point I was about to make be-
fore Mr. Zablocki raised his.
Section 36(b) does not contemplate a letter of offer having been
issued, it talks of a proposed letter of offer. So the question, for ex-
ample, of listing the date of acceptance would be improper in such a
notice. The reference in subparagraph 2 of the section 36(a) you will
* note is to the reports that are expected quarterly concerning all offers
to sale that have been issued and, two, requires a cumulative listing of
all such letters of offer to sale that have been accepted during the
fiscal year.
Those are after the fact but it would be improper for the adminis-
tration to come up with a letter and an acceptance at the same time.
They are not supposed to have issued the letter of offer until they have
submitted it to us for review and at that point it is a proposal, not a
sale.
Mr. DERWINSKI. Would the gentleman yield'? `~.
Mr. ROSENTHAL. I am happy to yield.
Mr. DERWINSKL I guess we have to wait until this mOtion or amend-
mont is disposed of, is that correct?
DISCUSSION OP ZABLOCKI AMEI'~ DMLNT
Mr. ZABLOCKI. My understanding is that the gentleman from New
York was about to offer the amendment.
PAGENO="0019"
15
Mr. ROSENTHAL. Legislative counsel say it-
Mr. BINGHAM. I don't understand this amendment and I really
~would like to speak in opposition to it. I think it is improper.
Mr. ZABLOCKI. The gentleman from Wisconsin has suggested an
amendment to the committee resolution of the gentleman from New
York on the basis of his argument earlier that there was not a pur-
chase, that there was not a sale. I think with a letter of offer to sell
the President does not have to have a consummated sale.
Mr. BINGHAM. Would the gentleman from Wisconsin restate his
iroposed amendment?
Mr. ZABLOCKI. On line-
Mr. DERwIN5KI. Mr. Chairman, do we have a formal amendment
pending?
Chairman MORGAN. Yes, we do.
Mrs. MEYNER. Mr. Chairman, what is the request of the gentleman
from New York?
Mr. BINGHAM. Will the gentleman from Wisconsin state his pro-
posed amendment to the Rosenthal resolution which, by the way, I
fully support in its present form.
Mr. ZABLOCKI. The gentleman from Wisconsin only intends to have
the committee resolution as proposed by the gentleman from New
York, Mr. Rosenthal, to comply with what is in the law. In section
36 (b) and in the paragraph above it for each letter of offer to sell
under the paragraphs 1 and 2 the report shall specify-and we have
A, B, C. D, and F-the requirements in the letter. The resolution as
proposed by the gentleman from New York on the basis of what his
earlier presentation was, he argued that there was not a buyer as yet.
Therefore, I suggested that wherever he refers to a "proposed sale"
that his committee resolution comply with the language of the law
and therefore substitute for "proposed sale" an "offer of sale" at line
5 in the whereas clause, on line 3 of the first resolved clause, on lines
2 and 3 of the section 2 and on line ~ of section 3.
Mr. FRASER. Would you yield?
Mr. ZABLOCKI. Yes.
Mr. FRASER. Let me say my impression is that the amendment of
the gentleman from Wisconsin be broader, that the section that we are
dealing with does refer specifically to offers of sale.
Mr. BINGHAM. Would the gentleman yield?
Mr. ZABLOCKI. What the gentleman from New York was referring
to, if I might add, as far as actual consummated sales are in the
quarterly reports in section 36(a).
Mr. BINGHAM. Is the gentleman from Wisconsin proposing-
Mr. ZABLOCKI. In lieu of "proposed sale" substitute "offer of sale."
Mr. BINGHAM. I think the correct way if he wants to use the words
"offer of sale" would be to add it after the word "proposed." There is
no offer of sale until after the 20 days have expired; therefore, it is a
proposed offer of sale.
Mr. ZABLOOKI. This is not what the law says. May I read the law
in section 36(b).
In the ease of any letter of offer to sell any defense articles or services under
this act for $25 million or more before issuing such letter of offer the President
shall submit
PAGENO="0020"
16
Chairman MORGAN. The time of the gentleman has expired.
Mr. Biester.
MEANING OF SECTION 36(b)
Mr. BIESTER. Mr. Chairman, as I look at section 36(b), and I gather
that is the operative section we are dealing with here, it seems to me
that the point at which this potential sale has reached in terms of
negotiations may very well be the point at which the submission should
take place. If you look at 36(b), it says:
In the case of any letter of offer to sell any defense articles or services under
this act for $25 million or more, before issuing such letter of offer the President
shall submit.
Now we all concede there is no formal letter of offer and there
should not be at this point as we are taking up this issue. What we in-
tended by the legislation was to find that point before which concrete
arrangements were made at which the Congress could state its opinion.
Now we are, as I understand it, at the point at which NATO has re-
quested a memorandum of understanding from the Department of
Defense for this proposed sale and it strikes me that it is precisely the
point at which this resolution would have been appropriate and this
submission would have been appropriate and it is not premature, it
is not tardy, but in terms of the time frames during which the Con-
gress is supposed to express itself the Department has done the right
thing.
I think the gentleman's amendment, which I reluctantly oppose,
clarifies and demonstrates that we are nt the correct point and his
amendment I think would carry us beyond that.
Mr. BINGHAM. Would the gentleman yield?
Mr. BIEsm~. Yes, I do.
MEANING OF "LETTER OF OFFER"
Mr. BINGHAM. May I refer the committee to the last sentence of the
paragraph in section 36(b). I beg the committee to remember that I
was the author of this section and I think I know what it was intended
to mean. The last sentence says:
The letter of offer shall not be issued if the Congress within 20 calendar days
after receiving any such statement adopts a concurrent resolution stating in
effect that it objects to such proposed sale.
So it is a proposal for a letter of offer that is being submitted and I
don't see what possible objection there could be. I am perfectly agree-
able to seeing the words "offer of sale" included in the Rosenthal
resolution but I think they should still be following the word "pro-
posed" because that is what we expect under section 36(b) is a pro-
posal for a letter of offer.
Mr. BIESTER. I thank the gentleman for that point. It seems to me
not only is he correct about the Zablocki amendment, the force of his
argument is that this is the tjme during which this submission should
have heenpresented to the committee.
Mr GILMKN Mi Chairman
Chairman MORGAN. Mr:Gilman.
Mr. GILMAN. Mr. Chairman, I would like to support the contention
of the gentleman from Pennsylvania. I think that his interpretation
PAGENO="0021"
17
of the section is valid and that leaves us with one other question, and
that is whether there is a valid buyer. Allegations have been made
that w~ have made prior sales to NATO. If there is a Defense official
attending the hearing this morning, maybe he could clarify for the
committee whether we have made such sales and whether such sales are
proper.
I note that the statute states that the proposal can be made either to
a foreign country or to an international organization. I am referring to
subsection (a) of section 36, subdivision IV, which states that the
sale can be made either to a foreign country or to an international or-
ganization. If there is such a Defense Department representative
present, Mr. Chairman, I would like some clarification to determine
whether we can~
Mr. ROSENTHAL. Would.the gentleman yield?
Mr. GILMAN. Yes; I am pleased to yield.
FURTHER DISCUSSION OF zABLOCKI AMENDMENT
Mr. ROSENTHAL. I think there is a consensus developing in the com-
mittee to accept the words "with respect to the proposed offer of sale."
I don't think Mr. Bingham objects to that and it is not inconsistent
with the point Mr. Biester made, and I think perhaps Mr. Zablocki
would accept that. The statute does have the words, as Mr. Bingham
said, "proposed sale" and as Mr. Zablocki said, "a letter of offer." If
we put in there "with respect to proposed offer of sale" in those five
places, I think we could all agree we satisfy our problem.
Mr. ZABLOCKI. Would you yield?
Mr. ROSENTHAL. Yes.
Mr. ZABLOCKI. Let me clarify. My only intention was to make clear
that there was not a buyer. It is my understanding that under 36(b)
a letter of sale is a letter of intent to sell. If the Congress does not
object, then it becomes a proposal to sell. I have no objection if you
are going to say amend it since this is a committee resolution. I have
no objection if we agreed to amend it to read "with respect to a pro-
1)osal of offer of sale."
Chairman MORGAN. Any objection?
Mr. GILMAN. Mr. Chairman.
Chairman MORGAN. Mr. Gilman.
Mr. GILMAN. I still think we should clarify whether an improper
resolution has been presented to us, and I would like some clarifica-
tion from the Defense Department as to whether it is proper to sell
to NATO, or must we sell to the individual country?
TESTIMONY OF DOD REPRESENTATIVE
Mr. Chairihan, with your permission could we hear from the De-
feiise Department?
Chairman MORGAN. I don't know if there are any Defense Depart-
ment representatives present.
Mr. WOLFF. Mr. Chairman, a point of order. We have disposed of
the matter on the sale.
Chairman MORGAN. The other matter was ~tabled, this is the com-
mittee resolution we are working Oil flOW.
PAGENO="0022"
18
STATEMENT OF LT. COL. KARL LAUENSTEIN, U.S. AIR FORCE, ACT-
ING SEECIAL ASSISTANT TO THE DIRECTOR, DEFENSE SECURITY
ASSISTAIWE AGENCY
Colonel LA1n~NsmIN. Mr. Chairman, I am Lt. Col. Karl Lauenstein,
U.S. Air Force, Acting Special Assistant to the Director, Defense
Security Assistance Agency.
With regard to Mr. Oilman's question, we have made previous sales
to NATO as an entity through FMS. The one that comes to mind as
perhaps the largest sale previously was a sale by the United States in
1973 for communications satellites and launch services. If I recall, this
sale was approximately $74 million and was a sale directly to NATO.
There are other examples; I don't have them with me.
Aside from the sale to NATO and NATO infrastructure. there have
been sales to the alphabet soup, if you will, of NATO such as supply
parts, things of this sort for items that went to individual countries.
Mr. OILMAN. Mr. Chairman, based on that response, if it is obvious
that we have the proper timing and a proper purchaser, then I ques~.
tion the objection.
Mr. BINGHAM. Would the gentleman yield?
Chairman MORGAN. The time of the gentleman from New York has
expired.
Mr. FRASER. Mr. Ohairman.
Chairman MORGAN. Mr. Fraser.
NATURE OF THE AWACS SALE
Mr. FRASER. Thank you, Mr. Chairman.
Can you tell me whether the proposed sale of the AWACS aircraft
is going to be to individual NATO countries or will it be to some
NATO institution?
Colonel LAUENSTEIN. The proposed sale, as indicated on our notifica-
tion to Congress, is to NATO. Now the question to be resolved is in
the payment for the aircraft.
Mr. FRASER. Let me ask the question. To whom will title be
delivered?
Colonel LAUENSTEIN. Let me digress for a second and say we are in
the process now of trying to go forward with a letter of offer to NATO.
The purpose of this is to elicit a response and begin to resolve the
many, many issues dealing with the sale of-
Mr. FRASER. Answer my question. If the sale takes place, to whom
will title go as you now anticipate?
Colonel LAURNSTEIN. As now anticipated it would go to NATO.
Mr. FRASER. They would take title to the aircraft?
Colonel LAUENSTEIN. Yes, sir, if the offer were accepted as issued..
Mr. FRASER. No individual country would claim title?
Colonel LAUENSTEIN. I cannot say that that would not occur. That
is a possibility.
Mr. FRASER. That turns out to be a critical difference here. You can-
not now tell us whether it will be France or Britain or West Germany
or NATO which would take title to the aircraft? What would your
expectation be?
PAGENO="0023"
19
Colonel LATTENSTEIN. All right. Our expectation and our intent
right now is to deliver a letter of offer to NATO, as an entity. If
NATO accepted the offer, title would be transffered to NATO.
Mr. FRASER. I want to know who is going to buy it and get the title.
Colonel LAUTENSTEIN. Sir, I cannot answer that just as I cannot tell
you whether the letter of offer will even be accepted. This is the time
we issue a letter of offer to a foreign government or any international
organization. It is an offer-a price and availability quote-which
may or may not be accepted by the purchaser.
Mr. FRASER. So what you are saying is that this notice does not serve
to inform us as to who will take title.
Colonel LAITENSTEIN. I am not saying that, sir.
Mr. FRASER. You don't know.
Colonel LAUENSTEIN. We have had a request from NATO for a let-
ter of offer, and it is to permit a response to that request that we have
provided the 36(b) notification.
Mr. FRASER. All right. Let me put it this way. If it turned out that
West Germany was going to take title to three of the airplanes and
France five or whatever, would you then think that this letter of
notice was inadequate c3
Colonel LAIJENSTEIN. I would have to respond along the lines that
under our understanding of 36(b) if the scope of the letter of offer
changed significantly or the purchaser changed, we would indeed
under the law be required and would voluntarily come forward with a
revised letter of offer notification.
Mr. FRASER. So in other words you would agree that if a country
in NATO was actually going to be the purchaser and take title that
this would not be an adequate notice under 36(b).
Colonel LAUENSTEIN. Sir, I am not qualified to address that ques-
tion. I think we are over into the legal area now and that is beyond
my field.
Mr. FRASER. That is what we are dealing with, a legal question. That
is why I think the-
BOEING AS AWACS OONTRACTOR
Chairman MORGAN. The time of the gentleman from Minnesota has
expired.
Mr. WHALEN. Mr. Chairman.
Chairman MORGAN. Mr. Whalen.
Mr. WHALEN. Mr. Chairman, I just wanted to ask the gentleman
a question.
The notice which you sent to Congress lists Boeing as the supplier.
Has the Department of Defense been under any pressure from other-
airframe manufacturers for consideration in this contract ~
Colonel LAUENSTEIN. Sir, again speaking from my position, I am
not aware of that nor am I qualified to comment in that regard; how-
ever, I would like to correct one thing. I don't recall in our notifica-
tion indicating that Boeing was indeed the contractor per Se. Under-
the transmittal of 36(b) we list the Air Force as handling the con--
tract.
PAGENO="0024"
20
Mr. WHALEN. I thlnk you are correct on that score.
Chairman MORGAN. Would the gentleman yield?
Mr. WhALEN. Yes.
Chairman MORGAN. I wonder if we can dispose of this.
Mr. WHALEN. I yield to Mr. Winn, Mr. Chairman.
IMPACT OF COMMITTEE RESOLUTION
Mr. WINN. Thank you, Mr. Whalen. I appreciate the gentleman
yielding.
I would just like to ask a question of Mr. Rosenthal.
Going back, there is nothing in your committee resolution now, is
there, that would prohibit the Department of Defense from going
ahead with the memorandum of understanding?
Mr. ROSENTHAL. There is nothing in that resolution at all for them
to continue negotiations. I assume they will raise it after the minis-
terial meeting if the ministers act in an affirmative fashion. If and
when they have a concrete purchaser with a name a.nd a number, they
ought to send a new letter and I suppose it will be treated appro-
priately.
Mr. `WINN. I thank the gentleman.
Mr. BINGHAM. Mr. Whalen, would you yield to me?
Mr. WHALEN. Yes.
Mr. BINGHAM. I would just like to respond briefly to my friend from
New York, Mr. Gilman. It was not only the fact of the identity of
NATO as aprospective purchaser that I think is objectionable. What
~ objectionable is the fact that so much of this proposed letter of
offer is vague and uncertain. We don't know the price, we don't know
the quantity, we don't know the identity of the purchaser.
PASSAGE OF ZABLOCKI AMENDMENT
Mr. ZABLO0KI. I move the previous question. and in order to clarify
-the matter I again would restate my amendment as amended by the
gentleman from New York, Mr. Bingham.
On line 5 after the word "to"-that is, Military Sales Act with
respect to the proposed offer of sale," and ]ikewise on line 3 of the be it
resolved it would read "to the proposed offer of sale"; in section 2,
line 2, "to the proposed offer of sale"; on line 3 of section 2, "with
respect to the proposed offer of sale"; in section 3, line 5, "to the pro-
posed offer of sale."
Chairman MORGAN. All in favor of the amendment of the committee
resolution-
Mr. BUCHANAN. Since our friend from New Jersey is no longer
with us, I would point out that you don't need to have this in all the
`places so I hope the staff will keep that in mind.
Chairman MORGAN. All in favor of the amendment offered by the
gentlemaui from IVisconsin so indicate by saying the word aye; all
-opposed no.
The committee resolution is amended.
PAGENO="0025"
21
PASSAGE OF COMMITTEE RESOLUTION ON AWACS
I wonder if we can vote on-
Mr. DERWINSKI. I would just like 30 seconds. As the chairman and
members know, I do worry about my dear colleagues and their becom-
ing captive of their rhetoric and positions. I just would like to remind.
you before you get totally wrapped up with wanting early warning
and early, early warning and early, early, early warning of proposed
sales that if this committee was so obsessed with that subject in Octo-
ber of 1973 when over $1 billion of unauthorized, unappropriated ma-
terial was shipped to the Middle East, Israel would have gone down
the tube while this committee was demanding an early warning. So
just don't get too totally captive of your own political positions.
Chairman MORGAN. All in favor of the committee resolution offered
by the gentleman from New York as amended will so indicate by
saying aye; all opposed no.
The ayes have it and the resolution is adopted.
Mr. FINDLEY. Mr. Ohairman, the resolution is adopted?
Chairman MORGAN. Yes.
Mr. FINDLEY. Let m.e make a little legislative history.
The way it reads, then this would be considered without prejudice..
The other interpretation is that this committee will consider a resolu-
tion of disapproval assuming that such will be before the committee.
I don't think anyone intended that second interpretation. Would there
be disagreement with that?
Chairman MORGAN. The committee stands adjourned until further
notice.
[Whereupon, at 11 :54 a.m., the committee adjourned.]
0
PAGENO="0026"