NEWS RELEASE
PLEASE NOTE DATE

DEPARTMENT OF DEFENSE
OFFICE OF PUBLIC AFFAIRS
Washington 25, D. C.

HOLD FOR RELEASE
UNTIL 6:30 PM (EDT); 5:30 PM (CDT)
SATURDAY, OCTOBER 19, 1963

No. 1385-63
Oxford 53201 (Info.)
Oxford 73189 (Copies)

REMARKS BY
ROSWELL L. GILPATRIC, DEPUTY SECRETARY OF DEFENSE
AT THE ANNUAL UPI EDITORS AND PUBLISHERS CONFERENCE
AMBASSADOR EAST HOTEL, CHICAGO, ILLINOIS
SATURDAY, OCTOBER 19, 1963

What I propose to talk about this evening is the new phase I believe we are entering in our national defense. It is important first to realize where we are and how we have gotten there. And it is also important to alert ourselves to the special problems we will be facing.

Five years ago at this time I was helping write the report of the Rockefeller Brothers study on U.S. defense problems as they then looked for the five years ahead. That report suggested that substantial Defense increases -- at a rate of about $3 billion per year and not leveling off before 1965 -- would be needed in order to adjust U. S. defenses to the changing conditions that were beginning to be recognized at that time. Since then we have in fact experienced many of the changes and the strengthening process which we and others who had looked at Defense problems in the late '50s had believed necessary. In particular, there has been a major improvement in our readiness for less than all-out warfare. And in the strategic nuclear area there has been a major effort to provide our forces with the capability for deliberate and controlled response -- particularly survivability -- that is so much needed in the era of ICBMs.

These changes have not come cheap. The U. S. defense budget has gone up 25% in a period of a few years -- from around $40 billion to over $50 billion. The effort has thus been large and expensive. But, as a result, the U. S. has come a long way towards correcting the deficiencies which had become so apparent at the end of the 1950s.

This country has been provided with a range of credible, usable, military power designed to enable us to deal with challenges all the way across the spectrum of conflict, from guerrilla warfare to thermonuclear war. There is still more to be done. But as the size of the increases indicate -- the 100% increase in the nuclear megatonnage in our strategic alert forces and

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the 45% increase in our combat-ready divisions, just to mention two examples -- much has already been added to our military strength. Barring a major and now unforeseen shift in the magnitude of the threat we face, the U. S. is not likely to require, over the next several years, further increments on so large a scale.

The question that faces us now is, where do we go from here? Such decisions have been faced before, not always as successfully as might have been hoped. In 1946, immediately after the end of World War II, the U. S. engaged in headlong, and in hindsight, premature reductions in its armed might. We had not even completed this demobilization before it became evident that the defeat of Hitler had not led to the peaceful world we had hoped for. By 1947 the Cold War had begun. But even after it became clear that we had to be prepared to carry the burden of a long-term commitment to military preparedness, our buildup was sometimes erratic. Any doubt of its need was finally resolved only by our experiences during the Korean War.

In the early 1950s, after the end of the Korean War, we entered still another phase. Those were the days of the "new look," the "bigger bang for a buck," and "massive retaliation." Essentially, this phase saw a decline in the share of national resources available to the conventionally-armed elements of the Army and Navy, and a concentration of defense dollars on strategic air power. By 1957 and 1958, a strong reaction had set in against these trends. The threat of "massive retaliation" had not, for example, been very successful in deterring communist subversion in Vietnam, when our French allies were fighting a difficult, bitter and losing battle against communist guerrillas. Nor had that threat prevented the Russians from crushing the East German uprising in 1954 or the Hungarian revolt in 1956.

Massive retaliation threats seemed hardly likely to be by themselves any more conclusive in the next decade, when intercontinental missiles would be in ample supply on both sides. Although it was certain that strategic forces would remain the backbone of any defense system, it also became increasingly clear that such forces, by themselves, were not enough to deal with the most likely forms of aggression. And there was another problem: the introduction of the ICBMs drastically cut the amount of warning time that could be expected ahead of the impact of a surprise attack. In fact, it became questionable whether it would be wise to count on the availability of any usable warning time at all.

Thus, the advent of the ICBMs created two entirely different, highly expensive and extremely urgent defense needs. One was to build up our capability to deal with limited acts of aggression. The other was to so shape our strategic forces that adequate numbers of delivery vehicles, plus necessary command and control arrangements, would be assured of riding out a well designed surprise attack.

Perhaps not unrelated to these defense developments, on the political front we were at the end of the 1950s entering a dangerous new period of East-West relations. The collapse of the Paris summit conference, the stalemate on the test ban proposal, the threats to Berlin, the frequent

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Soviet rocket rattling -- in short, the "Khrushchev offensive" -- confirmed the view that we were in a new and more hazardous period. There was a wide and growing consensus -- expressed through the reports of the Coolidge, Gaither and Rockefeller groups and through such Senate leaders as John F. Kennedy, Lyndon Johnson, Stuart Symington and Henry Jackson -- on the urgent need for strengthening of U.S. defenses.

Some of this improvement was begun in the closing years of the Eisenhower Administration. Secretary Gates, for example, gave strong support to the development of survivable missile systems such as POLARIS and MINUTEMAN. With the change in Administration, the strengthening process was expanded and accelerated. Our nuclear retaliatory weapons were hardened, dispersed and concealed to make them able to ride out an enemy attack under a survivable command and control system. Our heretofore neglected limited war capabilities were greatly increased, and our special forces for counter-guerrilla operations were expanded several times over. The entire planning process within the Department of Defense was overhauled to assure that we had one coherent national strategy, not a series of contradictory strategies pursued independently by each service.

Now, having in a sense gotten on top of the bow wave ahead of our military establishment at the end of the '50s, we face another new period in which we can hope for a level-off of Defense spending for the next several years. There may be -- indeed we hope there will be some decline in over-all defense costs. I emphasize may, because it could be that some increases will still be needed. But the general prospect is for a levelling off, with built-in increments -- such as the recent but long overdue $1.2 billion military pay increase -- offset by savings in other areas of the defense establishment. It is unlikely that sharp increases of the sort programmed in the early years of this Administration will be needed in the years immediately ahead. In terms of GNP percentage, there should be some decline in the application of U.S. resources devoted to purely military preparedness. Communist supported "wars of liberation," meaning subversion and covert aggression, will persist. So will the threat of larger scale aggression. But present force strengths -- with the augmentations and improvements already planned and programmed -- should be adequate to deal with those challenges.

Let us look then at some of the special problems associated with such a period of relatively stable defense spending. In important ways they are as difficult -- or more so -- than those faced in the first several years of this Administration. For in a period of military buildup and innovation, against a background of international tension, it is not hard to attract popular interest and support. It may be harder to achieve understanding of the important but less dramatic challenges that face us today.

I can see a number of major national problem areas ahead of U.S. defense planners in the next few years:

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First, there is the risk of what has been termed "euphoria." Perhaps that word has been overused lately, but it is a word that connotes a very serious danger. We should not forget that the test ban, and the current relatively relaxed state of international tension, are in significant part a consequence of our determination and firmness as reflected, among other ways, by our military preparedness. This country has seen the Spirit of Geneva of 1955 come and go, and the Spirit of Camp David of 1959 come and go. We hope that the current period of lessened tensions is founded on firmer ground. But the surest way to dissipate the gains that have been made would be to succumb to the tempting attitude that as a nation we can now sit back and relax; that we can now take defense less seriously; that we can now worry less about splits in the Atlantic Alliance; that we can now cut down on foreign aid, and so on. The recent flare-ups on the Berlin autobahn demonstrate how quickly events can change for the worse. There could be no greater folly than to weaken our national security effort at the very moment it is beginning to pay off. But that is precisely what is liable to happen if we do not keep reminding ourselves that the time when we can really relax still lies, unfortunately, a long way in the future. So the problem of "euphoria" is a real one, and an important one.

Second, we should candidly acknowledge that the U.S. defense industry faces a series of economic problems relating to the changing impact of defense spending. These problems are not entirely new, and most certainly are not insurmountable. As patterns of military procurement have shifted -- and they have shifted radically over the years, especially since the end of the Korean War -- a number of industries and areas have always been in the position of having to find civilian markets to replace former defense contracts. This was true even when the Defense budget was on the way up. But such shifts within a rising level of expenditure are not likely to have a major adverse effect on the general economy of our nation. Consequently, the over-all pattern in the last several years, although not unmixed, has been for military spending to provide a net stimulus to economic growth. For the defense-related segment of the economy has been increasing more rapidly than over-all GNP.

But for the next several years this is not likely to be the case. Military spending, as a percentage of GNP, is likely to decline somewhat. And although that could bring certain problems, they are the kind of national problems that should be welcome. For any relative decline in military spending makes available additional resources to meet important unmet needs in both the private and public sectors.

In the private sector, these resources can be made available through a lower tax burden; in the public sector, through programs for such urgent public needs as education, conservation and urban redevelopment. It is not the mission of the Defense Department to judge how these freed-up resources should be divided: how much to the private sector through tax cuts; how much to the public sector through expanded programs of federal, state and local governments. But all of us in government are directly concerned with the health of the American economy. A strong and growing

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economy is, after all, the necessary basis of all our national efforts, and especially of the unavoidably expensive efforts required in the national security area. We are, therefore, anxious to see that industrial capacity and skilled manpower not currently needed for defense is put to productive use. We do not want to see the availability of these important resources ignored and allowed to compound existing unemployment.

In that sense, the Defense Department has a direct interest in such efforts as the proposed tax cut to stimulate the economy. Without that kind of basic program for economic progress, more limited programs, such as those to which we in Defense can contribute, can hardly be expected to be enough to deal with the problem. But, given the necessary basic policies to strengthen the economy, there are things that the Defense Department can do, within that context, to play a useful, although necessarily subordinate, role in the broader effort.

One example is our effort, through the Defense Department Office of Economic Adjustment, to ease the impact on local communities of shifts in base requirements and in procurement patterns. Another area in which we have an opportunity to contribute is in making available, in timely fashion, as much information as we can so that industries can prepare themselves for shifts in procurement, up or down, that are coming. One of the major innovations introduced by Secretary McNamara has been the establishment, for the first time, of a five-year programming procedure setting forth for five years ahead our expected budget and force structure. The direct purpose of this five-year program is to aid in sensible planning and management of our defense effort. But this program can also serve as a valuable aid in helping industry to anticipate and prepare for shifts in defense procurement in the years ahead. Although the details of this five-year program are necessarily classified, we believe that, within the limitations imposed by security considerations, sufficient information can be made available to industry to be of real value in their forward planning. We have recently established a high level working group within the Department to keep an eye on this project and others in the general area of economic impact problems, and we intend to pursue such projects with increased effort in the coming months.

Third, let me turn to a problem area somewhat related to the economic impact problem. This is the need to continue our efforts to improve the efficiency of the military establishment. We have experienced to date a good deal of success with Secretary McNamara's Cost Reduction Program. As you have probably read, savings in the last fiscal year alone amounted to about $1 billion, $250 million more than the goal at the beginning of fiscal 1963. Because this program has been going so well, the target for annual savings by fiscal 1967 has been raised from the original $3.4 billion to our present goal of $4 billion per year.

But we must expect that keeping up the pace of this effort is inevitably going to be more difficult in the years ahead. In a period of level-off or contraction, it is only a human tendency, as prevalent among the military as elsewhere, to cling to functions and prerogatives for

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which it is hoped there will be a recurring need. That is why it will be
harder to continue major progress without public understanding and public
support for efforts to continue to improve the management of our defense ef-
fort.

Let me note also that this defense efficiency issue is directly related
to that of the economic impact issue mentioned earlier. Our ability to win
the support we need to continue the pace of this cost reduction effort is
inevitably going to be affected by whether there are productive uses waiting
for the resources we save, or whether we are merely saving resources
which then will be wasted anyway through increased unemployment and lower
productivity.

Fourth, there lies ahead of the U.S. military establishment a series
of evolutionary changes in the composition and disposition of its military
units stationed overseas. For years the U.S. has backed up the protection
of its vital interests and its alliance commitments by keeping a large pro-
portion of its active forces -- over a million individuals including de-
pendent<sup>c</sup> -- on duty abroad. For the foreseeable future the U.S. will main-
tain both large overseas deployments and significant capabilities to rein-
force such military power with great rapidity. However, some shifts in
the form our military presence has taken in recent decades are beginning
to be practicable. Ten years ago we lacked the ability the U.S. possesses
today to put in the field large quantities of logistical support and, through
longer range tactical aircraft, to bring to bear in combat theaters U.S.
based airpower in no more time than it took previously to deploy planes sta-
tioned on rear bases overseas.

Next week we will commence the largest deployment of combat-ready Army
and Air Force units ever made between the United States and Europe entirely
by air. This is Exercise BIG LIFT. The entire 2nd Armored Division and its
supporting troops -- some 114,500 men -- will be airlifted to Germany. They
will be accompanied by a Composite Air Strike Force of some 116 planes from
our Tactical Air Command. Altogether some 16,000 airmen and soldiers and
more than 350 planes will take part. This BIG LIFT Exercise will demonstrate
our ability to project our military power far more quickly over far larger
distances than has ever been the case in the past.

By employing such a multi-base capability the U.S. should be able to
make useful reductions in its heavy overseas military expenditures without
diminishing its effective military strength or its capacity to apply that
strength swiftly in support of its world-wide policy commitments. Any such
adjustments will, of course, be based on consultation with our major allies
and so far as possible upon agreed NATO policies. In particular we look
forward to continued close understanding with our allies in the Federal Rep-
public of Germany who share with us a primary responsibility for the Central
Front of the Western Alliance. The central object of our policy will be un-
changed: to sustain a major American presence in the defense of Western
Europe at all levels of force.

Finally, let me turn to the basic problem of keeping our defenses on
the alert, whether the international fever chart is rising or falling.

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For the moment, our power base is in good shape. But inevitably, over the years, there will be new periods of readjustment and reshaping of our defenses. Neither technology nor the world situation will ever remain static. As I mentioned earlier, the U.S. has experienced four major shifts in defense orientation in less than two decades since the end of World War II. We will undoubtedly find ourselves undergoing further reorientations in the years ahead. So it behooves us, regardless of the immediate climate in the international scene, to maintain the forward thrust of U.S. military technology, to remain sensitive to shifts in the power equation and not to count on a status quo which we know is not going to last.

In the past, too often our doctrine or our force levels have been out of phase with the military and political realities of the moment. I am not talking now about the kind of danger I discussed earlier under the heading of "euphoria." There is that danger of unwarranted relaxation of our national security efforts. But there is also the danger that we may remain intently alert, but to the wrong problems.

We have recently been going through an extensive period not merely of increasing our military power but of changing in important ways the character and orientation of that military power. In general, those changes have been intended to provide a range of usable military power capable of dealing with a broad range of contingencies. I emphasize "usable" because there is often a tendency to separate the idea of defense from the idea of deterrence, when the fact is that you cannot have a satisfactory deterrent to aggression which is incapable of being used to achieve rational objectives should aggression occur. If you lack that, your policy will be based on bluff, and sooner or later your bluff will be called.

To avoid slipping into that kind of posture, we have to keep alert to changes in the military and political and technological situation which affect the wisdom and sufficiency of our defense policies. Otherwise there may be some tendency to assume that we can merely stand pat for a while. No folly could be greater.

In closing, let me note that how well we are able to meet the kinds of defense problems I have been describing will depend heavily on the attitude of the press and the public which it serves. Giving these important defense issues intelligent coverage is not at all a simple task. To cite just one example of the almost overwhelming mass of material to be analyzed, there have been over 30 volumes of Congressional testimony relating to Defense in the past year alone. As I have said, it is relatively easy to develop understanding and support in a period of expanding defense effort against the background of rising international tension. Now there is at least a possibility that both those trends will be reversed. Yet the defense issues we will be facing in the next several years, whether or not they prove to be less dramatic than those in times of crisis, remain of the highest importance. Our effectiveness in dealing with these relatively "quiet" challenges is going to play a large role in determining whether we are going to be successful in the coming years in really advancing the cause of a just peace, or whether we are to accomplish nothing more than to set the stage for a renewed, and perhaps even more dangerous, period of crisis.

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