WASHINGTON - Pundits these days warn of a Middle East arms race if Iran brings its alleged nuclear weapons programme to fruition, while others fear that missile defence in Eastern Europe could spark escalation involving Russia.

But despite all the fear in Washington, it turns out that the U.S. need look no farther than its own shores to find the greatest single source of weapons proliferation around the globe.

It's the U.S, according to a new report from the New America Foundation, which "is the world's largest arms supplier". And with 23 billion dollars in receipts in 2007 and 32 billion dollars in 2008, including only foreign sales, the U.S. is also cashing in.

From escalating hostilities to encouraging human rights abuses, these arms deals have a plethora of potential negative effects.

"Arms transfers can serve as a U.S. government 'seal of approval' for governments engaged in unacceptable behavior, not to mention being used as tools of internal repression and instruments of warfare with neighboring states," said the report.

But with a change of administration rapidly approaching, and President-elect Barack Obama ready to take the helm of government, the U.S.'s unique and dominant position in the global arms industry could be ripe for a change.

"We are at another moment when we can reevaluate what our role [ought to be]," said the director of New America's Arms and Security Initiative, William Hartung, during a press conference on the report Wednesday.

The last shift, said Hartung, came under outgoing Pres. George W. Bush, who "subsumed [the arms trade] under the global war on terror" so that if a country could make the case of being an ally in the effort, it could get arms and perhaps even subsidies towards their purchase.

"As the size, scope, and sophistication of U.S. transfers has increased during the Bush administration, so have the risks," says the report, especially in the developing world, where most violent conflicts occur and where the U.S. does billions in sales.

While arms sales are usually thought of as a defensive or preventative matter -- lopsided support by the world's preeminent military power should clearly be a deterrent -- the fact of the matter is that U.S. deals play a major role in fighting around the globe.

"U.S. arms and military training played a role in 20 of the world's 27 major wars in /2007," said the report, co-authored by New America's Hartung and Frida Berrigan.

One of the risks is that the sale of arms remains "relatively unregulated," according to Hartung, who noted the hypocrisy of regulating chemical and biological weapons, but not small arms.

It is, after all, traditional weapons that are used "day-to-day" in conflicts, said Hartung.

"Small arms and light weapons have a more immediate impact" due to the ability to inject them into a conflict and have them spread quickly because they are small, light, and cheap, said Hartung.

The U.S. has signed more than twice as many arms transfer agreements over the past eight years (200-2007) than its nearest competition. In that time, the U.S. made nearly 124,000 deals, compared to the Russia, which has made just over 54,000.

In the past two years for which figures are available, 2006 and 2007, three of the top four largest U.S. buyers in the developing world were Middle East allies.

Saudi Arabia acquired 2.5 billion dollars worth of U.S. arms, with Israel dishing out just over 2.0 billion dollars. The post-invasion Iraqi government spent nearly 1.5 billion dollars on weapons.

But the U.S. biggest arms client is turbulent Pakistan, which spent more than 3.5 billion dollars on U.S. weapons.

And while weapons often go to U.S. allies in hotspots or nations actively engaged in combat (sometimes with the U.S. in coalitions, where sales help "interoperability"), weapons sometimes are used as political currency as well.

"Politically, arms and training can be used as leverage for everything from gaining preferential access to oil and other strategic resources to persuading other countries to vote with the United States in international and regional bodies like the United Nations and the Organization of American States," said the report.

Hartung, at the conference for the report, emphasised the point. "Each of these deals has its own logic," he said. Some deals are based on U.S. access to military facilities, some to support a coalition ally, and some with an eye to the future and deterrence, as with proposed missile defence systems."

But, said Hartung, "human rights concerns have gotten pushed aside for these [various logics]," noting that 13 of the top 25 U.S. arms recipients are "undemocratic regimes and/or human rights abusers."

"There is less concern in policymaking circles about the negative impacts of arms sales, from fueling conflict to enabling major human rights abuses," said the report.

Hartung noted that human rights issues needn't be a deal-breaker for military support and arms deals, but rather it just needs to be a more prominent, legitimate consideration. Though he does point out, as does the report, that it is actually meant to be a deal-breaker, according to the U.S. Foreign Assistance Act of 1961.

"In the case of the United States, this is true despite the fact that U.S. law calls for curbs on sales to countries engaged in a 'gross and consistent' pattern of human rights abuses or to countries using U.S. weapons for aggressive purposes. More often than not, these reasonable requirements are set aside in favor of the short-term strategic, political, and economic objectives," said the report.

With the Bush administration in a lame-duck lull, the report makes a series of recommendations to the incoming Obama administration.

It should, says the report, create a clear policy directive for arms transfers within the first six months in office; return the State Department to its former lead (or at least equal) role in foreign assistance, in contrast to the Bush policy of empowering the Department of Defence to make these decisions at the expense of State; and "endorse and/or ratify key international initiatives" that regulate arms in warfare and the global arms trade.