The Carter administration has found a way to supply Iran with some very expensive armed frigates, without violating the president's self-imposed ceiling on overseas arms sales.
The method: let European countries build the costly ships, and then the United States will supply the less expensive weapons to make them effective.
Rep. Paul Findley (R-Ill.), who disclosed the ploy yesterday, called it "an enormous loss in shipbuilding jobs for the United States" with no gain in actual control of armaments. "Coming at a time when the U.S. dollar is sinking abroad while the U.S. shipbuilding industry is sinking at home, the administration's handling of the Iranian transaction deserves high marks for stupidity," he said.
According to Findley's account and interviews with embarrassed administration officials, Iran is buying more than $2 billion in hulls and propulsion systems for 12 guided missile frigates from Dutch and West German shipyards. However, the United States is selling the guns, missile and torpedo systems and other weaponry for the ships at a total cost of $350 million.
Informed sources attributed the idea for the split-level sale to Lt. Gen. Howard Fish, formerly the Pentagon's chief arms salesman, and Ambassador to Iran William H. Sullivan. Both the shah and top U.S. Navy officials were reported to be unhappy with the arrangement but powerless to find a way to allow Iran to buy the ships from the United States without breaching Carter's ceiling.
A recent White House review of arms for Iran within the past several weeks looked again at the separate sales of ships and their arms but took no action to change it, the sources said.
Congressional and executive branch sources said the shah has long wanted to buy heavily armed frigates as escorts for the four big Spruance class destroyers that the Nixon and Ford administrations agreed to sell to Iran. A preliminary request to purchase the frigates was made to the United States late in 1976.
As Carter's policy took shape in 1977, the decision to impose a U.S. arms sale ceiling beginning in 1978 caused a problem for the Iranian ship purchase.
Carter and the shah discussed the arms purchases in their meeting last November. According to administration sources, the shah was told then or a short time later that he would have to choose between the frigates or some other high priority weapons, such as the Airborne Warning and Control System plane, but he could not buy them all and stay within the Carter ceiling.
Originally the shah requested eight frigates, which would have cost at least $200 million each. Together with associated equipment, the total cost would have been about $2 billion. The other weapons that Iran is buying from the United States this year will cost at least $1.8 billion and perhaps as much as $2.6 billion - a large share of Carter's overall arms sales ceiling of $8.6 billion for the year.
After deciding to buy his ships from the Netherlands and West Germany - and to increase the order to 12 ships - the shah formally requested the U.S. weaponry so that the frigates would have the same armaments as the destroyers they were to protect. This would make the ships more compatible and improve operational efficiency.
Within the past few days, Congress has been informed that the sale of U.S. weaponry for the 12 European-built ships has been approved by the Carter administration. The arms include two kinds of surface-to-surface missile systems, high powered automatic guns and a modern torpedo launching system.