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For years, the U.S. government has provided arms to Israel. Now there's word of a major arms deal with another player in the Middle East: Saudi Arabia. The U.S. government is finalizing plans to sell $60 billion in fighter jets and helicopters to the Saudis over the next several years.

As NPR's Tom Bowman reports, the deal could change the military balance in the Middle East and also help some balance sheets here at home.

TOM BOWMAN: A senior defense official says a proposed arms deal is more than seven times bigger than past deals with the Saudis. The driving force behind the deal, the official says, is Iran, and the threat that country's leadership poses to the Persian Gulf region. But as defense analyst Loren Thompson points out, American jobs are also a big factor.

Mr. LOREN THOMPSON (Defense Analyst): This transaction is going to be very welcome with the U.S. defense industry because it has been facing softening demand at home for weapons.

BOWMAN: Softening demand. Defense Secretary Robert Gates is pressing for cuts in the defense budget, as much as $100 billion over the next five years. Some analysts say that's only a start. So for some defense giants like Boeing, Thompson says, it's important to look to overseas market. Here's the Saudi shopping list: Fighter jets - Boeing builds the F-15 fighter and the Saudis plan on buying more than 150 new and upgraded F-15s. Good news for Boeing, which was shut out in competition to build the next fighters for the U.S. Air Force.

Next: Helicopters. Boeing builds the Apache attack helicopter and another known as the Little Bird. And the Saudis plan to buy dozens of each of those.

Mr. THOMPSON: The biggest winner in this transaction is Boeing, which will be selling both fighters and attack helicopters to the Saudis.

BOWMAN: Boeing declined to talk about the proposed deal, since Congress has yet to be formally notified. But a senior defense official said the company believes some 77,000 jobs will be involved. A mix of new jobs would be created and current jobs would be retained if the Saudi deal goes through. Building the aircraft could mean jobs for a decade. That's good news for places like St. Louis, where parts for the F-15s are made.

A spokesman for Senator Christopher Bond, a Missouri Republican, says a proposed Saudi deal would keep production lines open. And he also says the deal is important to the U.S. strategic national interests in the Middle East. That's not how everyone sees it.

Mr. WILLIAM HARTUNG (Analyst, New America Foundation): I think it's a new arms race.

BOWMAN: William Hartung is an analyst with the New America Foundation and studies arms proliferation.

Mr. HARTUNG: Hopefully these weapons won't get used, but if nothing else, it's going to be a huge economic drain on countries that might want to invest in their domestic economies, which in some ways is another form of security.

BOWMAN: And Hartung says the goal of containing Iran could backfire on the Obama administration.

Mr. HARTUNG: I suppose it'll have some effect on Iran, but it may just drive Iran to spend more money on their own military, so I don't see a net gain in terms of security coming out of it.

BOWMAN: There is even more money being spent on American arms in the region. Israel plans on buying a more advanced American warplane - the Joint Strike Fighter. They should arrive in Israel around the time the Saudis gets their new F-15s.

The�$60 billion Saudi aircraft deal is only the beginning. There could be tens of billions of dollars more in sales. That's because the kingdom also is in talks with the U.S. about beefing up its missile defense capabilities and its naval forces.

Mr. THOMPSON:�The Saudis want to upgrade their fleet of warships and aircraft in the Persian Gulf region.

BOWMAN: Again, defense analyst Loren Thompson.

Mr. THOMPSON: So they have been putting together a program called the Eastern Fleet Modernization program that will probably buy a next-generation warship, air defense radars and missiles, and probably helicopters also to patrol opposite the border with Iran.

BOWMAN: That next-generation warship is a small, high-speed ship that can operate close to shore. The Saudis already are eyeing it, even though the U.S. Navy hasn't even ordered one for itself yet.

Tom Bowman, NPR News, Washington.

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