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December 22, 1957

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# XI - BUDGET FOR NATIONAL SECURITY

Achievement of the objectives of our national security programs in the years ahead hinges on the availability of financial resources and the manner in which they are applied. There is grave reason for concern with respect to recent levels of military appropriations as well as with respect to the workings of the budgetary process.

## The Budgetary Level

Programs of great importance to U. S. security now suffer from insufficient funds, and at present budgetary levels our prospects are bleak.

Several reasons have brought about this state of affairs. When the Korean war ended, it was natural that an effort be made to reduce military expenditures. But the execution of these reductions, displaying less accuracy than force, had serious consequences. These did not become evident for some time because of a backlog of unspent appropriations. For example, the momentum of the Air Force build-up continued until unspent appropriations from 1952 to 1953 ran out and, where major procurement is concerned, the Army has been living off its pre-1954 appropriations.

The result has been a serious imbalance in our military posture. Recent budgetary levels could be maintained only by a reduction of forces in all services, a process which has been slowly going on for the past three years. The budgetary squeeze has affected not only force levels, it has also produced

Goodpaster

Page 77 - top of page ".... a slowed down effort in certain fields...."

Some of the problem is these efforts were started late. Analysis
of the records indicates long-range ballistic missile program only began
in 1954. Less than one million dollars a year prior to that time.
The business of starting late ought to be put into the report.

middle of page: second pgh. re inadequacies of our present force structure.

What are we referring to there. It would be better to make the
point with regard to certain areas of our force structure, but not the
general area.

Under Deterrence, point 1. "authorized into the 1960's"

The sense is not clear .Is it that each year it should be continued?

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December 22, 1957

a slowed down effort in certain fields such as missile research, where our
position vis-a-vis the U.S.S.R. could have been maintained with a relatively
small additional effort.

Recent military expenditures are therefore inadequate to maintain
even our current force-levels at least with our present wasteful organization.
But events have made clear the inadequacy of our present force structure. And
remedies have to be sought against the background of an increasingly complex
technology which will inevitably multiply costs.

This panel does not possess the technical competence to determine
the budgetary level which could assure our security. It will therefore confine
itself to listing the major shortcomings in our strategic posture.

Strategic Forces

Deterrence

1. Unless aircraft procurement to modernize existing units is authorized into the 1960's, a gap in ready forces between the latest types of manned aircraft and the operational stage of ballistic missiles seems unavoidable. We cannot risk obsolescence of present weapons before new ones are ready.

2. The SAC base structure, long out of phase with other elements in its program, should be made less vulnerable to surprise attack through dispersion and other protective measures.

ELLIS JOHNSON: Statement 3 should now be 4. and read: "Accelerated research and development support should be provided for all programs including such key programs....."

Statement 4 will now be statement 5.

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December 22, 1957

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3. Accelerated research and development support should be provided for such key programs as missiles and advance reconnaissance systems.

4. The SAC alert time should be reduced.

## Active Defense

Today, the U.S.S.R. can attack the U.S. with a strong bomber force and with submarine-launched missiles. In a few years it will be able to attack with a stronger bomber force, greatly improved submarine-launched missiles, and numerous ICBM's.

Accurately delivered on our biggest cities, only twenty-five nuclear weapons -- a small proportion of the total the U.S.S.R. can send against us -- could kill 25,000,000 persons, not counting those who might die from the effects of a radioactive fall-out carried many miles downwind.

Whichever side first achieves a strong defense will be in a strong psychological position. Should the Soviet Union achieve a really effective air defense ahead of us the balance of power will fall to her. She will then be able to blackmail the entire free world, because few nations will act vigorously if they know that they may be devastated with relative impunity.

Early warning and anti-missile defense systems therefore require greater attention.

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December 22, 1957

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## Tactical Forces

To provide something more than the token mobile units presently in being, additional troop lift should be authorized in the form both of modern aircraft and modern ships.

The Army should be permitted to speed up the modernization of its division structure.

## Navy

Anti-submarine warfare requires additional funds. The program of equipping both surface and underwater ships with nuclear propulsion and missiles of various types should be accelerated. We require a larger number of modern, nuclear powered submarines.

## Personnel

With the complexity of modern weapons, the importance of a highly competent professional force has never been greater. But present pay scales are inadequate to retain the skilled officers and men necessary to an effective and economic military establishment. Neither are we attracting a sufficient number of the best of our youth to military careers.

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December 22, 1957

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## Civil Defense

A start should be made on a program of fall-out shelters and related warning and communications equipment.

The above deficiencies in our strategic posture can be removed only by a substantially increased defense effort even allowing for a more efficient utilization of resources through the reorganization of the Department of Defense. The price of survival will not be low. On the other hand its effects will be cushioned by the expected growth of our Gross National Product. The impact of defense spending on our national economy will be discussed in detail by Subpanel IV. This much seems clear however to this panel: The valid measurement of defense is against security achieved and in the efficiency with which resources devoted to it are utilized. We can afford to survive.

## The Budgetary Process

An increased defense effort will not be fully effective however unless it is accompanied by the organizational changes outlined in Section VII. These in turn can be prompted by improvements of existing methods of presenting the budget.

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December 22, 1957

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The budgetary process could be greatly improved if military budgets were prepared and presented in more meaningful terms. The present method of preparation does not give the President, the Secretary of Defense, Congress or the public a clear indication of what the funds requested will accomplish in terms of military missions or effective units. As a result, it is natural for Congress to make reductions by percentage cuts across-the-board, rather than by selective examinations of individual programs.

Complete budgetary reform may not be immediately feasible. However, a start can be made toward a system that corresponds more closely to the general strategic philosophy of this report. It should not be too difficult, for example, to restate the presentation of the Air Force budget, so that instead of the present categories of "aircraft and related procurement," "procurement other than aircraft," "operation and maintenance," "military personnel," etc., there would be a clear indication of how much goes to strategic air, to air defense, to tactical air, and to air transport. The present budget structures of the other services are equally far from indicating expenditures along mission lines.

Another highly desirable change is to transform the present one-year budget cycle to two years. Under present rules, the top personnel of the services spend the first six months of every year preparing, justifying and revising the budgetary requests of their departments. The next six months are consumed in testifying before congressional committees and otherwise defending the service budgets as approved by the President. If the budgetary process would extend

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December 22, 1957

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over an entire congressional term, the energies of key personnel could be
directed toward strategic doctrine and overall management. At the same time
congressional control would be more meaningful because the examination of
requests could then be more careful.

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December 22, 1957

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## XII - CONCLUSION

No aspect of America's problems presents a deeper challenge than the field of national security. It is not only because the technical problems are so complex, though an accelerating technology will test severely our wisdom and our ability to make choices. Nor is the economic challenge the most complicated one we face, though the price of security in the nuclear age is high and likely to increase. It is not even the field of strategic doctrine which presents our deepest problem though military strength is sterile without a doctrine for employing it.

Rather our chief difficulty resides in our ~~whole~~ approach to the problem of power and it reflects some of the most attractive qualities of American society. We like to believe that reasonable men can settle all disputes through good-will and compromise and that power should be invoked only as a last resort. We therefore tend to think of diplomacy and force as successive and separate phases of national policy. Unfortunately the position in which we find ourselves does not permit such absolute distinctions. In a revolutionary period the ability and willingness to use force may in itself provide a factor of stability. To a world threatened by aggression and infiltration, American strength and resolution are essential if there is to be a guarantee of security.

To be sure, this may not always be apparent in the public declarations of other nations. To countries primarily concerned with domestic development

["## XIII - CONCLUSION", "In order to have a true and effective international morality, it is necessary that all nations, whatever their size, have the same moral standards.", "The question of international morality is not new. It has been raised in many different forms. It has been discussed by all the great moral writers of the modern age, and it has been considered in many different ways. But the question of international morality has not been fully raised until now. Since the modern age has begun, there has been a great moral movement, which has been called internationalism. Internationalism is the belief that all nations have the same moral standards, and that these standards are to be achieved by all nations working together. Internationalism is not a new moral movement. It has its roots in the Christian moralism of St. Augustine, and it has its source in the moralism of the great moral writers of the modern age. But the moral movement of the modern age has been a great moral movement, and it has been a moral movement which has been based on the Christian moralism of St. Augustine. It has been a moral movement which has been based on the Christian moralism of St. Augustine and the moralism of all the great moral writers of the modern age. It has been a moral movement which has been based on the Christian moral

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December 22, 1957

foreign aggression may seem unreal and the measures required to resist it may appear as irritating interruptions of more primary tasks. But while we should have full understanding for the psychology which produces these reactions, we would be wrong to gear our policy to it. Force will not solve the problems of this period but the willingness to use it may afford the breathing spell in which nations can work out their own destiny without foreign interference. We must not forget that the neutrality of many nations is possible only as long as we are strong, just as for a century and a half the British navy made possible our military protection suddenly withdrawn.

Power is a fact whether it be ours of that of the Soviet Union. Its war may be difficult to think about, but it is not existence cannot be ignored. The dilemmas which it imposes cannot be wished away. Yet the power of modern weapons confronts us with a moral dilemma.

The extensive and indiscriminate use of modern weapons in all-out war runs counter to our deepest sense of international morality. We should seek to limit such wars as may break out to the smallest area and to conduct them with the minimum loss of civilian life. Yet in the conflict between despotism and freedom, it would be immoral were we to shrink from the defense of the values for which we stand at whatever intensity which may be forced on us.

We are engaged in the phase of a global struggle which has come to be known as the cold war. In this report we have tried to set forth those measures which we feel it imperative to take action on in the interest of national security. We consider them essential if we are to reduce the likelihood of war.

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December 22, 1957

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and at the same time to make sure that if in spite of all our efforts such a grim disaster should prove unavoidable, we shall not be overwhelmed by it.

The cold war poses a two-fold dilemma: our desire for peace may make us overlook the importance of power in maintaining it. But once we have recognized the role of force we must beware that it does not become an end in itself. Power can only give us security against immediate dangers. In the long run, our security resides in the principles for which we stand and in the confidence which we inspire. These are facts which we must never forget in the middle of the cold war; they are indeed what gives it meaning.

We have not attempted to put a price-tag on any of the measures we advocate. For when the security of the United States and of the free world is at stake, cost cannot be the basic consideration. The cold war cannot be won and a "hot" war cannot be avoided without a major effort. This is clearly not time for complacency; it is just as clearly not a time for hysteria. What is required throughout the country is a **deep sustained determination**. If this report makes a contribution to the emergence of such a mood it will have served its purpose.

Addition for subsection 41 of surface water report
on budget for national security

There is still another change in budgetary procedures which would strengthen in a positive way the fiscal control of the Secretary of Defense and might ultimately reduce, if at least offset, increases in, the size of the overall defense budget. That is to have all military appropriations made solely to the Department of Defense rather than separately to the three military departments as at present.

Elsewhere in this Report it is recommended that appropriations for research should be made directly to the Secretary of Defense and not to the services, a step in line with the present basic law under which the Secretary of Defense has the duty of making adequate provision for research and development on scientific problems relating to the national security. This same concept might well be extended to other categories of military appropriations, particularly if, as suggested earlier in this Report, the separate military departments are to be relieved from responsibility for military operations and are to concentrate on functions of a logistic and administrative nature.

The change here suggested would not be inconsistent with legislation now on the books, because the Secretary of Defense already has, and frequently exercises, the power to approve rates of obligation of appropriated funds before such

funds are made available to the respective services. With a
unitary budget procedure the detailed work of preparing,
processing and justifying military budgets would continue
to be done by the staffs of the departmental comptrollers,
and there would be no need to create another level of budget-
ary officialdom in the already overlayered structure of the
Defense Department. Nevertheless, the Secretary of Defense
and his staff would have more influence in the shaping up of
budget requests than is now possible under the present prac-
tice of merely issuing advance guide lines for the service
budgets. Moreover, that influence would be brought to bear
at a less adventitious time, namely before the dollar posi-
tions of the individual services are frozen as is now the
case when each service prepares and presents its own budget.

There is good reason to believe that by channeling
all defense appropriations through the office of the Secretar
of Defense it would be possible to achieve major savings
which certain authorities in such matters have estimated as
high as 5%. Whether or not such savings materialize, the
suggested change would produce immediate benefits in the for
of more flexibility in budgetary procedures and a quickening
of the decision making process which is so important in the
direction and administration of our security affairs.