With all the disparaging books about Saudi Arabia being turned out by the bale, it might be time to remember the crucial part the Saudis played in hastening the demise of the Soviet Union and ending the Cold War.
As we all can recall, the Soviet colossus cast no spell over President Ronald Reagan, and his administration's strategy, devised in the White House in 1982, had as its goals restoration of U.S. prestige and military superiority and showing the Kremlin who was boss.
To Reagan's new group of advisers, Moscow had been emboldened throughout the 1970s by American timidity and flabbiness and by early 1983, Reagan had begun to take a tough line: calling the Soviet Union "the evil empire" and challenging the Kremlin's legitimacy as a government. He also called for internal policies to be changed inside the Soviet Union, the first time any American president had done so since Harry Truman.
To the Soviet's dismay, Reagan ordered a titanic military buildup that would expand the U.S. Navy from 450 to 600 ships. Already in 1981, Yuri Andropov, head of the Soviet KGB, was so convinced the United States was planning a surprise first nuclear strike that he instituted a series of special war alerts, called "Operation Ryan," which gave Soviet spies the task to look for any signs that the United States was preparing a nuclear sneak attack. In 1983, when NATO conducted an exercise, called "Able Archer," that practiced the release of tactical nuclear weapons at sea, the Soviets thought it a cloak for something far more sinister. The Kremlin leaders had always used military exercises as a well to conceal genuine military movements as they had in their 1952 invasion of East Germany and the 1968 takeover of Czechoslovakia.
Thus with "Able Archer," the Soviets perceived America as doing the same thing, and, in London, the Soviets began an all-out push for new information about a first strike using GRU and KGB agents. According to British intelligence historian, Christopher Andrew, a wild-eyed Andropov frantically ordered preparations in Department 8 of the KGB for terrorists attacks on NATO and American targets in Europe, including letter bombs to be sent to British Prime Minister Margaret Thatcher's office and dead drops of explosives to be placed behind vending machines or under sinks at restaurants near American bases in West
Germany. Other Russian specialist teams were to use biological and chemical weapons on designated targets.
A deep, anxious gloom settled on the psychologically shaken Soviets: the world had suddenly become a perilous place. The U.S. military build-up did indeed take place: 3,000 combat aircraft, 3,700 strategic missiles, and 10,000 tanks purchased in Reagan's first six years, all of which is a matter of public record.
But other movements were afoot that were to have a decisive effect on the Soviet Union's fate. There was the dangerous gambit to use CIA-based Afghan mujahedin in Soviet-occupied Afghanistan to conduct military strikes, and another that used an underground "rat line" or intelligence network in Poland to undermine the Soviet hold on Eastern Europe.
And there was a third. According to former Reagan Cabinet official who spoke with United Press International, America was waging another secret "economic war" with the Soviets that profoundly involved the Saudis.
An excellent account of this war is given by Peter Schweizer, a former Hoover fellow and a first-rate Cold War historian in his book "Reagan's War" which has only recently been released but which is a work of the first order.
Former senior Reagan advisers, who spoke with UPI on condition of anonymity, described how the Reagan group had ingeniously targeted Soviet hard currency earnings. If Moscow were broke, it couldn't develop or buy weapons and couldn't even pay its troops, much less finance wars of liberation around the world.
It could take tough but wouldn't be tough.
The first blow was struck in May 1983 when American pressure forced the International Energy Agency to put a limit on European exports of Soviet natural gas, blocking huge sums of money. But natural gas earnings were only a sideshow for the Kremlin: Russia's top engine of economic wealth was its oil, which accounted for half of its hard currency earnings.
By early 1983, the Treasury Department, under the direction of CIA Director Bill Casey and Secretary of Defense Casper Weinberger, had completed a voluminous study of U.S. and Soviet energy costs. The study had discovered that the best price required by the United States for a barrel of crude oil was $20. This was far below the $34 per barrel being charged in 1983. If oil prices came down, it would save the United States almost $72 million a year, or almost 1 percent of gross national product. What would a fall in the oil price do to the Russians?
Very ugly things, it seemed. The study concluded that while a cut in oil prices would boost U.S. economic welfare, the same cut would have a "devastating effect on the Soviet economy," in the words of one former Reagan adviser. In fact, Reagan adviser Bill Clark told Schweizer: "Ronald Reagan was fully aware that energy exports represented the centerpiece of Moscow's hard currency earnings," which was working at full capacity. A drop in price and the Russians would be hurt.
U.S. officials were soon huddling in Geneva with the Saudi oil adviser, Sheikh Ahmed Zaki Yamani. Following the meeting, the United States announced it was cutting its oil imports from 220,000 barrels per day to 145,000 barrels. In late February, the Saudi Ambassador Prince Bandar met with senior U.S. officials including Casey and Weinberger.
Abruptly, the Saudis cut oil production. By August 1985, Saudi production jumped from 2 billion barrels a day to 9 billion. Since Saudi Arabia was the swing producer in OPEC and used production levels to control the market price of crude, the effect was instantaneous. In Russia, the effect was calamitous.
How did the price cuts effect Saudi incomes? Did they lose money on the deal? Hardly. Former senior CIA officials said the agency's currency-exchange specialists bounced billions of dollars of Saudi currency reserves from one currency to another: from the Belgian franc to the British pound and back, earning them "billion of dollars" in the words of one former official.
So in a time of Saudi baiting, it may befit us to remember that in one of the most lethal and colossal struggles of all time, it responded to requests by the United States with a measure the dramatically hastened the Soviet collapse.
