The Reagan Defense Budget: Failing to Meet the Threat

Report Budget and Spending

The Reagan Defense Budget: Failing to Meet the Threat

July 14, 1982 About an hour read Download Report
Richard McKenzie

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1 96 July 14, 1982 THE REAGAN DEFENSE BUDGEZ FAILING TO MEET THE THREAT INTRODUCTION The FY 1983 defense budget debate in Congress is shaping up as yet another somber chapter in the decline of American military power. The U.S.-USSR military balance has alre a dy shifted to such a degree that most Western defense analysts believe that the USSR would stand a good chance of winning a war for Europe or the Persian Gulf oilfields. Yet Congress seems bent on stripping 30 billion in outlays from the Administration's defense budgets over the next three years--$lo billion from the FY 1983 budget alone.

The arguments of defense budget cutters are twofold: first cuts in the defense budget are necessary to reduce the huge federal deficit, decrease interest rates, and spark economic recovery; second, the planned military buildup can be slowed, and indeed some major weapons programs cancelled, without jeopardizing U.S. security interests I This last opinion is flatly contradicted by the professional judgment of America's top civilian and uniformed military experts who have testified before Congress that the Administration's level of defense spending "would not close the gap in accumulated military assets between the United States and the Soviet Union until the early 1990s imp l ying either a further deterioration in our security or a need for a defense increase considerably steeper than what the Administration now proposes."l Defense The words are those of Dr. Fred C. Ikle, Undersecretary of Defense for Policy, in testimony befo r e the Senate Armed Services Committee Criti cism Rises on Reagan's Plan for 5-Year Growth of the Military The New York Times, March 22, 1982, p. 1. 2 critics react skeptically to such an assessment, viewing it as mere hyperbole to help sell the Pentagon's budget. In fact however, the 'truth is to be found with professional military leaders. Without substantial increases in the Administration's FY 1983-FY 1987 defense budgets, the United States will be con demned to military inferiority throughout the 1980s and beyond.

Even though this state of affairs coincides with a time when drastic cuts in federal spending are imperative, there is no way to avoid the painful reality that only significant hikes in the Pentagon budget will make up for a decade of inadequa te defense spending and keep pace with a Soviet arms buildup dwarfing that of Nazi Germany.

This is not to say that savings cannot be found in the defense budget. There are billions of dollars of waste in opera tions and weapons procurement at the Pentago n. To preserve the pro-defense consensus, which is threatened by a growing sentiment that the Defense Department is not spending taxpayer dollars wisely, it is essential that the Administration vigorously pursue cost-savings measures.

A recent Heritage Fo undation publication outlined a number of such measures regarding weapons design and production.2 Any savings, however, rather than being used as an excuse for lower budget levels, should be reinvested into enhanc ing American military strength.

Defense e xperts have also criticized a number of expensive weapons systems the Administration is buying, arguing that they are either harmful--their capabilities actually decrease military effectiveness--or are cost-ineffective--their cost is too high relative to their military capabilities. Critics maintain that by procuring larger numbers of cheaper, individually less capable weapons, the U.S. could buy an adequate level of military capabil ity at less cost.

Some of the arguments against specific weapons systems are valid and demand immediate corrective action by Congress and the Administration. But a leaner, more cost-effective military force does not lead directly to a smaller defense budget. There is no magical set of weapons that will solve America's immediat e military problems within the present overall budget level. Similarly although the Administration's military strategy and operational planning desperately need some fundamental revision, there is no clever strategy with which the U.S. can adequately defen d its interests without a substantial military buildup.

A defense effort capable of countering the Soviet buildup will be unavoidably costly. Money earmarked for defense cannot be spent on consumer goods and domestic programs. Although the Robert Foelber C utting the High Cost of Weapons Backgrounder No. 172 Washington, D.C The Heritage Foundation, 1982 3 actual burden of defense on the U.S. economy is widely misunder stood and exaggerated, it is nonetheless possible that a large scale military buildup coul d to some limited extent impede econo mic recovery. The fundamental issue of the defense budget debate however, is whether a greater threat to U.S. security and the defense of the free world is posed by rearmament induced inflation and high interest rates- -or by Soviet military power question, it is the latter.

Without U.S. MILITARY INFERIORITY In 1962, the year of the Cuban missile crisis, the U.S possessed sufficient military power to successfully defend its interests against Soviet attack. While the Sovi et Union and its East European satellites enjoyed quantitative advantages over NATO in conventional weapons and manpower, they lacked the command control-communications C3) systems, logistics capability, maneuver I addition, U.S. preponderance in low yiel d battlefield nuclear weapons stood threateningly over Warsaw Pact armies and tactical air forces. With its superiority in strategic nuclear forces the U.S. could have prevailed over the USSR even in a central nuclear war I skills, and firepower for milita r y victory over the West. In I Since 1960, however, Soviet spending on weapons procurement research and development (R&D and related military construction so-called military investment, has grown annually at 4 percent.3 U.S. military investment, on the oth e r hand, declined every year but two from 1962 to 1976, excluding outlays necessitated by the Vietnam War. From 1976 to 1980, investment outlays started growing but only by a miserly 1.7 percent a year spending surpassed that of the U.S. in 1967 and in the decade of 1971-1981 exceeded that of the U.S. by $440 billi~n In 1981 Soviet spending on weapons development and procurement was twice that of the U.S.5 Soviet weapons Today the Soviet Union enjoys clear numerical superiority over the U.S. in almost every weapons category, including strate According to former Central Intelligence Agency analyst William T. Lee whose work impelled the CIA in the 1970s to double its assessment of Soviet military spending, the Soviet defense procurement budget has grown by 14 percent a year since 1970 The Soviet Defense Establishment in the 1980s," Air Force Magazine, March 1980, p. 100.

Defense Department, Annual Report FY 1983 (Washington, D.C U.S. Govern ment Printing Office, 1982), p. 111-1

24. Soviet spending for all military functions--military investment plus pay and operations and maintenance exceeded that of the U.S. by $710 billion.

Total Soviet defense spending was 50 percent greater than that of the U.S but 60 percent of the Soviet budget goes for weap ons investment as opposed to 40 percent for the U.S 140 Chart I F USSR COMPARISON OF US MILITARY INVESTMENT OUTLAYS WITH ESTIMATED DOLLAR COST OF SOVIET MILITARY INVESTMENT ACTIVITIES 40 20 I I I 1961 1966 1971 1976 1981 CALENDAR YEAR NOTES l) INVESTMENT I NCLUDES RDT&E, PROCUREMENT AND MILITARY CONSTRUCTION 2) SEA= SouthEast Asia 5 gic nuclear and theater nuclear delivery systems. For a long time, the U.S. could offset much of its quantitative military inferiority with advantages in weapons technology. As a result of a determined effort that has exceeded that of the U.S. by $120 billion in the last decade, however, Moscow now leads qualitative ly in many areas of weapons technology, including that of ICBM l1counterrnilitary1l potential (the ability to destr o y hardened targets short-range and intermediate-range ballistic missile technology, chemical and biological warfare, directed energy weapons, anti-satellite warfare, electronic countermeasures ECM armored combat vehicles, attack helicopters, artillery fir epower, ship-to-ship attack capability, integrated naval C3 land and sea based surface-to-surface missile systems, and non acoustic anti-submarine warfare (ASW).6 And where behind, Moscow is fast catching up.

Soviet improvements in other areas of military capability such as logistics, mobility, and communications, have been equally impressive. Today, many Western military experts concede that Soviet prospects would be quite good for winning a conventional war with the West to gain control of Europe or the Persian Gulf oilfields.

In Europe, the Warsaw Pact outnumbers NATO by wide margins in tanks, armored fighting vehicles, artillery pieces, anti-tank weapons, air defense systems and tactical combat aircraft. To make matters worse, NATO's strategy for defend ing Europe is rigid and predictable and plays into Soviet strengths. NATO forces are badly deployed with the strongest units--the American and German deployed in the hilly south, leaving open German plains to the some Bundeswehr assistance NATO needs at l e ast two week's mobilization time to bring in reinforcements from the U.S the United Kingdom, and Holland, and set them up in defensive posi tions, if it is to have any chance at all of stopping a Warsaw Pact invasion. Under certain not implausible assumpt i ons, however NATO could have as little as forty-eight hours warning of a Soviet/Warsaw Pact attack.8 defense of less powerful British, Dutch, and Belgian forces, with This according to John C. Collins, Senior Specialist in National Defense Library of Cong r ess, in U.S.-Soviet Military Balance (New York: McGraw Hill, Inc 1980 pp. 111-114 At a recent West Point conference on problems of the U.S. military Congressman Newt Gingrich (R-GA) made just such a claim. Not one of the participating military officers or defense specialists disputed the statement. See George C. Wilson Military Pessimism Aired Washington Post, June 6, 1982, p. 7.

NATO's war planning is based on the assumptions that the Warsaw Pact will not attack Western Europe without first mobilizing its less ready Category I I1 divisions, which would take over two weeks, that NATO intelligence forces will detect early on any Warsaw Pact mobilization, and that NATO military-political leaders will promptly order a counter-mobilization. 6 Chart I1 U.S.-SOV I ET MILITARY BALANCE 1981 U.S. Soviet Intercontinental ballistic missile (ICBM) 1,052 1, 398 Submarine launched ballistic missile (SLBM Strategic missile submarine SSBN Strategic bomber Strategic surface to air missile SAM Strategic interceptors Anti-balli s tic missile (ABM) launchers Medium/intermediate range ballistic missile Short range ballistic missile (SRBM Medium bombers M/IRBM 576 36 316 0 312 0 986 84 150 12,000 2,500 32 0 144 60 680 957 500 Army divisions (active Main Battle tanks Infantry fighting vehicles Artillery/Rocket launchers Anti-tank guided missiles AA Artillery SAMs Attack helicopters 16 11,400 20,000 6,500 16,600 3,200 600 1,000 173 45,000 62,000 22,700 22,500 8,000 3,300 950 Tactical fighter/bombers 1,810 4,350 Attack submarines Cruise m issile submarines Aircraft carriers (strike VTOL carriers Helicopter carriers (ASW Guided missile cruisers Gun cruisers Destroyers Frigates Amphibious warfare ships 84 0 14 0 0 27 0 82 78 67 190 69 0 2 2 26 11 73 180 84 Naval fighters/attack Naval medium bombers Naval ASW aircraft/helos 1,043 0 25 7 85 380 435 Marines/Naval Infantry 3 divs 5 rgmts Source: International Institute for Strategic Studies, The Military Balance 1981-19

82. Collins, U.S.-Soviet Military Balance.

It is feasible, however, for the Warsaw Pact to launch an attack from a standing start" using only the fifty-three ready divisions deployed in Eastern Europe with a high probability of success. There is a very real 7 Chart I11 NATO VS. WARSAW PACT EQUIPMENT LEVELS, 1981 Major Weaponry NA T O Warsaw Pact Tanks 13,000 42,500 Armored Infantry Vehicles Artillery Pieces 30,000 10,750 78,800 31,500 Anti-tank Weapons 8,100 24,300 Attack Helicopters 400 7 00 Tactical Combat Aircraft 2,975 7,240 Source: North Atlantic Treaty Organization, NATO and t he Warsaw Pact: Force Comparisons (Brussels, 1982 p. 84 The conventional balance in Southwest Asia is far worse than in Europe and provides the Soviets with the opportunity to defeat the West cheaply without fighting a major war in Europe.

Soviets have 25 tank and motorized infantry divisions comprising 260,000 men, 6,500 tanks, 8,500 armored personnel carriers (APCs 1,500 air defense guns 3,000 SAMs, and 1,500 artillery pieces stationed at bases in the Soviet Caucasus, Trans-Caucasus, and Turkestan areas, that could form the spearhead of a drive through Iran toward the Persian Gulf oilfields. (This does not include the 100,000 troops in Afghanistan These forces could be quickly augmented by 5 to 10 additional divisions from other Soviet military districts w ithout significantly weakening Soviet capabili ties on other fronts. For quick seizure of strategic assets, the Soviets could airlift into the Gulf region within hours three airborne divisions with 33,000 men, 90 self-propelled assault guns, 306 APCs, and 108 field guns The For air support, the Soviets could use some 1,000 of their total 4,350 tactical fighter-bombers. Medium bombers from the 500-strong Soviet Long Range Aviation forces would also be avail able. Since 1979, the Soviet Union has also mainta i ned in the possibility that NATO could be caught by surprise if the Warsaw Pact mobilized under cover of maneuvers or a policing action against an East European satellite an attack from a "standing start see NATO and the New Soviet Threat Report by Senato r s Sam Nunn and Dewey Bartlett to the Senate Armed Services Committee 1977 p 6. For a discussion of the "powerful psychological and political incentives for decision makers to misinterpret warnings or to delay the necessary response" to Warsaw Pact mobiliz a tion, see Richard K For a discussion of Warsaw Pact capability to launch Betts, "Surprise Attack: NATO's Political Vulnerabilities International Security (Spring 1981 pp. 111-143 8 Indian Ocean a naval battle group with fifteen major surface warships and a number of torpedo-cruise missile submarines, which could be reinforced by units from the Soviet Far Eastern Fleet.

The Soviets could also use some of their 310 bombers equipped with anti-ship cruise missiles to attack U.S. ships in the area.

American Ra pid Deployment Forces (RDF) available for action in South Asia include: one airborne division, one airmobile division, one cavalry brigade, one mechanized division, various Ranger and unconventional warfare units, one to two Marine Amphi bious Forces (eac h comprising a Marine division and air wing four to eleven Air Force tactical fighter wings (each with 72 aircraft), two squadrons of long-range bombers, three carrier battle groups with approximately 180 fighter-bombers, and five naval anti-submarine patr ol squadrons.

This is a powerful force. But two problems hinder the effective use of these units to meet a Soviet threat to the Persian Gulf. First, the RDF is a creature of existing forces all of which are assigned major roles in meeting Soviet threats in other theaters of conflict. If the U.S. were to send its RDF to the Persian Gulf, it would seriously weaken its capability to defend its interests in Europe and elsewhere. The Soviet Union on the other hand, has sufficient reserves to fight simultaneousl y on a number of fronts.

Second, the U.S. is woefully short of air and sea lift equipment necessary to move its ground forces to Southwest Asia quickly and in sufficient strength to defeat a Soviet invasion A minimum of 50 days would be needed to [deploy] a complete mechanized division to the Gulf, utilizing the full resources of the U.S. Military Airlift Command; some 21 days would be required to deploy even the 82nd Airborne division, the smallest division in the U.S. Army The 82nd Airborne has no tanks, armored fighting vehicles, or organic air defense force.] Sealift, the only realistic means of moving large ground forces, also would entail substantial time in transit Even U.S. Marine amphibious forces already deployed in the Western Pacific would need t welve to fourteen days after embarkation (it would take a week or longer to assemble and load the assault-transport ships) to reach objectives inside the Persian'G~1f.I In two weeks, the U.S could position in the Persian Gulf at most two tflighttt brigade s one brigade of the 82nd Airborne and one Marine Corps brigade with its supplies and heavy equipment (53 tanks, 95 APCs, 12 self-propelled howitzers, 24 towed howitzers) pre-positioned on ships moored at Diego Garcia, a U.S.-U.K. base 3,000 miles from Jef f rey Record, The Rapid Deployment Force and U.S. Intervention in the Persian Gulf (Cambridge, Massachusetts: Institute for Foreign Policy Analysis, 1981), p. 20. 9 the Gulf.lo In another two weeks this force could be reinforced with two additional light br igades or one Army mechanized brigade and one Marine Amphibious Force. These forces, however, would lack the mobility and firepower to successfully defend against a concerted Soviet attack.

Hence, it is not surprising that Defense Department simula tions f or Persian Gulf scenarios almost always end in defeat for the West.ll The Reagan Administration has introduced into its war planning the option of Ifhorizontal escalationI'--staging counteroffensives against Soviet vulnerable points outside the main theat e r of conflict. Unfortunately, this strategy offers no solution to the West's problems in South Asia. Widening the war to Europe is not a viable NATO option. And, although the U.S conceivably could eliminate Soviet forces in Cuba, Libya, Ethiopia and South Yemen, as well as the Soviet navy on the high seas, the Soviet leadership might well accept such a trade-off for control of the Persian Gulf oilfields.

The U.S., of course, has a vast arsenal of low yield lftheaterl1 nuclear weap ons and high yield lIstrategictf nuclear weapons, but in the context of the present nuclear imbalance, nuclear escala tion is not a rational option for the U.S. It would not reverse the military situation in either Europe or the Persian Gulf, and would in vite needless destruction of populations and property at the hands of superior Soviet theater and strategic nuclear forces i In Europe, the Soviets hold a twelve to one edge in ballistic missiles--the most effective means of delivery for nuclear weapons.

O f U.S. delivery systems 88 percent are either short-range artillery pieces that can easily be overrun by advancing Soviet eighteen NATO air bases, all vulnerable to Soviet nuclear counter- fire. These aircraft will have to run a gauntlet of 5,000 Warsaw P a ct SAMs to reach their targets forces, or dual-capable aircraft that must operate from only I Most important, the Soviet Union has a coherent strategy for nuclear war, and it trains and equips its forces for nuclear combat. NATO, on the other hand, has ne v er formulated such a coherent nuclear strategy. Operational planning is almost non lo This assumes use of military transports only. If all the available aircraft belonging to the Civilian Reserve Air Fleet were utilized something "the President would want to avoid except in the most severe emergencies delivery of a light division to the Gulf could be shortened by one-third. Congressional Budget Office U.S. Airlift Forces: Enhance ment Alternatives for NATO and Non-NATO Contingencies (Washington D.C U.S. Go v ernment Printing Office, 1977), pp. 54-58 A Pentagon study on Persian Gulf war scenarios Capabilities in the Persian Gulf leaked to the press in 1980, concluded that the U.S. could not defend the Gulf with conventional weapons A-Weapons Scenarios Reported ly Studied Los Angeles Times, February 3, 1980, p. 7 l1 10 existent. NATO force deployments in the forward and rear battle areas are highly vulnerable to nuclear attack, more so than are Warsaw Pact forces.

Soviet advantages are even more pronounced at the strategic nuclear level. According to many defense experts U.S. ICBMs are vulnerable in their fixed silos and almost all would be lost in a Soviet first strike, leaving the Soviets with a four to one advantage in overall strategic missile throwweight and a fifty to one advantage in land-based ICBM throwweight. Strategic Air Command B-52s that survive a Soviet attack, probably less than 50 out of 316, will be up against an awesome Soviet air defense network composed of 6,000 radars, 12,000 SAM launchers, a n d 2,600 interceptors--1,080 of which are late model MiG-23s and MiC-25s.l2 The U.S. has 36 nuclear submarines armed with 576 nuclear missiles. Communications with these submarines, however, would be highly unreliable during war, while the missiles they ca rry have low yields and relatively poor accuracy, making them useful mainly as retaliatory weapons in massive strikes against Soviet cities rather than against hardened military targets such as missile silos.

Given the Soviet capability to retaliate with s imilar strikes on the U.S an American president would be most unwise to order submarine launched missile strikes on Russian cities. This would leave the U.S. with no alternative but to accept defeat at the hands of Soviet conventional forces in Europe or Southwest Asia.

Some strategists argue that, despite the vulnerabilities and deficiencies of U.S. armed forces, deterrence is stable because Soviet leaders in their planning must take account of the possi bility that the U.S. would use nuclear weapons afte r all and that, once the nuclear threshhold were crossed, the conflict would escalate to llall-outll nuclear war--a war in which, it is believed, there would be no winners l3 thing in a war with the West is thought to be sufficiently large to deter the So v iets from directly challenging U.S. interests between the superpowers would be victorless--is, however The risk of losing every The major premise of this argument--that all-out nuclear war l2 ICBM vulnerability and threats to U.S. strategic bombers, missi le firing submarines, and communications-control systems are discussed in Roger Speed, Strategic Deterrence in the 1980s (Stanford University: Hoover Institution, 1980).

McGeorge Bundy, former National Security Advisor to Presidents John F Kennedy and Lynd on B. Johnson, and recently in the news for his support of a "no first use" nuclear weapons policy, is an ardent proponent of this argument. See his "Strategic Deterrence Thirty Years Later: What Has Changed in The Future of Strategic Deterrence: Part I, e dited by Christoph Bertram (London: International Institute for Strategic Studies 1980), pp. 5-12 l3 11 subject to question. In contrast to the paltry U.S. effort in civil defense--$lo0 million a year--the USSR has been investing about 2.5 billion annuall y (in current dollars) since the mid 1960s on civil defense measures such as evacuation planning stockpiling of food and medical supplies, shelter construction and hardening of industrial fa~i1ities.l~ The USSR has also been pursuing vigorous research and d evelopment of anti-ballistic missile ABM) radars and missiles, and has almost certainly stockpiled key items for a rapidly deployable thick ABM net~0rk.l A number of military experts now believe that under certain assumptions, e.g that U.S. nuclear forces are depleted in a first strike and the Soviets have time to take civil defense precautions, the USSR could escape a strategic nuclear war with levels of damage not too much higher than the 20 million deaths suffered in World War 11. More important, the le vel of damage to the USSR would be far below what the U.S. would suffer from Soviet retaliatory strikes.16 Fortunately, the Soviets do not accept the Nazi view of war as spiritually ennobling and a test of national character.

Soviet military doctrine in fa ct is quite cautious on the use of armed force. Nevertheless, the threat from Soviet military superiority is extremely grave As Harvard Sovietologist Herbert Dinerstein pointed out twenty-four years ago: "If the Soviet leaders acquire preponderant militar y strength, they would have policy options even more attractive than initiation of nuclear war. By flaunting presumably invincible strength, the Soviet Union could compel piecemeal capitulation of the demo~racies Although Soviet military superiority is as yet not overwhelming it will likely be so by the late 1980s, unless the U.S. and its allies mount a substantially greater defense effort.

Defense budget cutters have pointed to a number of difficul ties confronting the Soviet leadership, including a stagnating 14 15 16 17 W. Dale Nelson Soviet's Budget for Civil Defense Set at $2.5 Billion,"

Philadelphia Inquirer, March 18, 1982, p 6. Soviet civil defense efforts are reviewed in Leon Goure, War Survival in Soviet Strategy: USSR Civil Defense (Miami University: Center for Advanced International Studies 1976).

Clarence Robinson Emphasis Grows on Nuclear Defense," Aviation Week and Space Technology, March 18, 1982, p. 6.

For the argument that Soviet strategic defenses "are likely to prove both workable and s uccessful" after a Soviet counterforce first strike, see Daniel Goure and Gordon H. McCormick Soviet Strategic Defense: The Neglected Dimension of the U.S.-Soviet Balance Comparative Strate Spring 1980 pp. 103-127 reviewed in Speed, op. cit., and Office o f Technology Assessment, The Effects of Nuclear War (Washington, D.C U.S. Government Printing Office, 1979 pp. 56-59, 100-106.

Herbert Dinerstein The Revolution in Soviet Strategic Thinking Foreign Affairs, January 1956, p. 252 The effectiveness of Soviet civil defense is 12 economy and restless East European satellites, as possible brakes on Soviet adventurism and hence as justification for a slower U.S. rearmament program.18 Other military strategists, however have credibly argued that these same problem s could well push the Soviets to take advantage of their military superiority, before the onset of their own internal collapse or Western rearmament,lg and to administer a crushing defeat on the West through a bold initiative, such as direct military assau lt on the Persian Gulf In short, deterrence is not so secure as budget cutters suppose.

If the Soviets begin to probe Western areas of interest in earnest, what will American leaders do? Defense budget cutters have no responsible answer THE REAGAN DEFENSE EFFORT To reverse the military trends of the last ten years, the Reagan Administration has set a course of rearmament that will cost $1.65 trillion in the six year period FY 1982 to FY 1987.

In FY 1982, the U.S. is spending $195. 4 billion for defense with 227.8 billion authorized in total obligational authority (TOA All spending figures are inflation adjusted FY 1983 dollars This amounts to real increases in FY 1982 of $25.6 billion in TOA, or 12.7 percent, and $13.0 billion in o u tlays, 7.7 percent over FY 1981 spending levels. As the second stage of its rearma ment program in FY 1983, the Administration is requesting $258 billion in TOA and $215.9 billion in outlays, for a real increase over FY 1982 of $30 billion in TOA and $20. 5 billion in outlays or 13.2 percent and 10.5 percent respectively. Total real increases Chart IV REAGAN DEFENSE BUDGETS FY 1982-FY 1987 in billions of constant FY 1983 dollars Real Increase over 1982 1983 1984 1985 1986 1987 Total Carter FY 1981 Levels 19 8 1 TOA 202.2 227.8 258.0 269.8 297.8 314.0 325.9 1,895.5 508.1 Increase 10.9 12.7 13.2 4.6 10.4 5.4 3.8 198.2 208.8)*(219.2 Outlays 182.4 195.4 215.9 232.2 255.6 276.0 288.7 1,647.2 356.4 Increase 4.1 7.7 10.5 8.0 9.6 8.0 4.6 184.413 192.4);k( 201.2 Propos ed Carter spending levels with Reagan inflation assumptions.

See, for example, Les Aspin Too Much Defense in One Big Bundle Los Angeles Times, January 26, 1982, p. 5-B.

See, for example, Colin S. Gray, "The Most Dangerous Decade: Historic Mission, Legitimacy, and Dynamics of the Soviet Empire in the 1980s,"

ORBIS (Spring 1981 pp. 13-28; and Carl Friedrich von Weiszacker Can A Third World War Be Prevented?" International Security (Summer 1980 pp 198-205. 13 in defense spending for the two years FY 1982 and FY 1983 amount to $81.4 billion in TOA and 46.5 billion in outlays, a large sum indeed, but the increase in outlays in the Reagan budgets is only 2.7 percent higher than that projected in the Carter budgets for the same period. As Chart IV shows, defense spending (outlays is projected to rise over the FY 1982-FY 1987 period at an average annual rate of 6.7 percent and will provide an additional $356 billion for defense over constant FY 1981 spending levels.

This spending is woefully inadequate, however, t o provide sufficient military power to defend U.S. interests with a reason ably confident chance of success. The major military threats to U.S. interests include a Soviet nuclear attack on the U.S a Sovietfiarsaw Pact invasion of NATO Europe an assault on the Persian Gulf oilfields or on neighboring countries, such as Pakistan, by the Soviet Union or local forces a North Korean invasion of South Korea Cubanfiicaraguan supported revolutionary wars in Central America or the Caribbean; and military attempts b y Third World revolutionary states such as Libya, Syria, Ethiopia, and South Yemen, to menace U.S. trade routes or to undermine our allies.

All'of these threats must be considered when structuring U.S. armed forces. The first three, however, dominate U.S. war planning. U.S. strategy for such contingencies is one of Flexible Response, which requires that the U.S. use the least amount of force possible to prevent a U.S./Soviet conflict from escalating to all-out nuclear war. If the Soviets attacked using con ventional weapons, NATO would first try to defend with conventional weapons.

If defeat were imminent, however, the U.S. would use nuclear weapons in a controlled, limited way to destroy the Soviet advance or to force cessation of hostilities to forestall u ncontrollable escalation. The U.S. must also be prepared to match any Soviet first use of nuclear weapons, strategic or tactical, against the U.S Europe, or allied forces anywhere in the world, with retali atory strikes that cause equivalent damage. And i t must be able to do so under a wide range of attack scenarios--from limited counterforce attacks to massive countervalue attacks on cities even under conditions of surprise.

The original understanding of Flexible Response, as it was formulated in the 1960 s, was that U.S./NATO would match or exceed the Soviet Unionmarsaw Pact at all three levels of force conventional, theater nuclear, and strategic nuclear. However for budgetary reasons allied governments abandoned the requirement for conventional parity w i th the Warsaw Pact at the same time that the U.S. abandoned its policy of nuclear superiority By 14 the early 1970s, the Soviets had attained strategic and theater nuclear parity with the U.S. and had conventional superiority over NATO. Today, the Soviets have a dangerous level of superior ity at all three levels.

The Reagan defense budgets will not close the gap between strategy and forces at any of these levels In the professional judgment of America's military leaders reported in a new Defense Departmen t planning document U.S. conventional forces would have to be expanded in the following way to be reasonably sure of defeating Soviet invasions of Europe and South Asia and to meet other U.S. military commitments: Army divisions increased from 16 to 25, c a rrier battle groups from 13 to 22, tactical fighter wings from 24 to 38, Marine Amphibious Forces from 3 to 4, and air transports from 522 to 1,090.20 The Reagan defense budgets however, fund no Army expansion, no Marine Corps expansion, only two addition a l carrier battle groups, only four fighter wings l and less than 150 air transports.21 Most of the additional $356 billion over EY 1981 spending levels available in the next five years will go for weapons modernization programs started in the Carter Admin i stration and for various readiness and sustainability measures, including building up ammunition and war reserve stocks of weapons and spare parts, and eliminating backlogs in operations maintenance O&M 40 billion worth--and military construc tion--$4 bil l ion worth.22 U.S. tactical nuclear forces, moreover will be only marginally improved over the next five years and U.S. strategic nuclear forces will continue to be vulnerable to Soviet first strikes and incapable of matching Soviet counter military power A comparison of the Administration's FY 1982 and FY 1983 defense programs with the ongoing Soviet modernization effort shows in more detail the deficiency of the Administration's defense budgets WHAT ARE THE REAGAN DEFENSE BUDGETS BUYING?

Roughly 25 percen t of the Reagan defense budgets in FY 1982 and FY 1983 is designated for military pay and retirement. The Reagan budgets will increase spending for these items by $6.3 2o George C. Wilson U.S. Defense Paper Cites Gap Between Rhetoric, Inten tions," Washin gton Post, May 27, 1982, p. 1.

Some existing Army and Marine Corps units are being strengthened with additional personnel and equipment levels. For details, see Defense Department, Annual Report for FY 1983, pp. 111-4-6.

The O&M shortfall figure is that of William Schneider, now chief defense analyst for the Office of Management and Budget in "National Defense,"

Agenda for Progress (Washington, D.C The Heritage Foundation, 1980 p 26. The military construction shortfall figure is from DoD, op. cit p. 111-1 56 22 15 billion over EY 1981 levels, assuming that requested pay hikes are approved. The 5 billion in real growth in the military personnel account is for pay increases above those needed to keep pace with the Consumer Price Index and to increase militar y end strengths by adding 66,000 servicemen to fill out existing units Chart V REAGAN DEFENSE BUDGETS BY APPROPRIATIONS CATEGORY FY 1982-N 1983 TOA in billions of FY 1983 dollars Appropriation Category Military Pay Retirement Pay Operations Maintenance Pro c urement RDTSlE Military Construction Family Housing Revolving Management Funds FY 1982 Budget 46.3 20.0 16.0 7.0 66.3 29.4 69.8 30.6 21.2 9.3 5.3 2.4 2.4 1.1 0.5 0.2 Appropriation Category Military Pay Retirement Pay O&M Procurement RDT&E Chart VI ADDITIO N AL REAGAN DEFENSE DOLLARS Billions of FY 1983 Real Increase Real Increase FY 1981-82 FY 1982-83 2.7 1.6 0.4 0.5 4.8 4.1 15.0 19.8 2.3 3.1 Military Construction 1.5 0.1 Housing 0.1 0.4 Revolving Sr 0.4 Total 16.7 30.0 Management Funds -0.1 dollars N 1983 4 7 .9 16.5 70.4 89.6 24.3 5.4 2.8 0.9 Budget 18.6 6.4 27.3 34.7 9.4 2.1 1.1 0.3 Additional Spending Percentage Over FY 1981 Levels Increase 5.0 5.6 1.3 4.2 13.7 11.1 49.8 45.4 7.7 20.4 3.1 40.8 0.6 13.0 0.2 14.3 81.4 Another 30 percent of the budget--$66.3 b i llion in FY 1982 and $70.4 billion in FY 1983--is earmarked for operations and 16 maintenance functions: civilian pay, food, clothing, and human support services; fuel; training; spare parts; and maintenance of weapons and facilities. The level of OM fund i ng is a vital indicator of force readiness. Yet O&M functions, especially fuel, training, and weapons maintenance, were seriously underfunded in the 1970s as the Services tried to sustain force modernization in the face of congressional defense budget cut s . By 1980, the OM shortfall amounted to $40 billion, resulting in severe reduc tions in Air Force flying and Navy steaming hours, reductions in military exercise, depot maintenance backlogs, and non-usage of expensive systems for lack of spare parts. In E 'Y 1982-FY 1983 the Reagan Administration will .spend in real terms an additional 13.7 billion on OM over FY 1981 levels. Weapons readiness is improving as a result, but many problems remain.

Roughly 46 percent of the J?Y 1982 and FY 1983 defense budgets is devoted to military investment--$96.3 billion in FY 1982 and 109 billion in FY 19

83. It is the major weapons programs, some 50 or so systems detailed in the Pentagon's quarterly Selective Acquisition Reports (SARs that attract most attention in the defense budget debates. Procurement funding for these systems however, amounts to only 18.7 percent of the total defense budget.

In FY 1983, for example, only $48.6 billion is requested for the Defense Department's top 50 weapons. O ver $30 billion will be spent on minor weapons and support equipment. Another $10 billion is requested for ammunition and weapons spare parts; $24.3 billion is requested for weapons research and development; and $5.4 billion for military construction Syst e m Army Chart VI1 MAJOR WEAPONS PROCUREMENT PROGRAMS Ouant i tv FY 1983 Fundine M-1 tank M-2 infantry fighting vehicle MLRS rocket Copperhead laser guided artillery shell Stinger surface-to-air missile DIVAD air defense gun Patriot surface-to-air missile L i ght Armored Vehicle (UV) UH-60 utility helicopter AH-64 attack helicopter Hellfire anti-tank missile TOW anti-tank missile Pershing I1 medium-range ballistic missile 776 600 23 640 8 420 3,816 96 376 392 93 48 3 971 13 000 91 millions of dollars 2 025.0 8 7 2.4 444.4 204.5 330.3 673.9 881.0 209.8 733.0 965.0 249.2 174.1 508.6 17 Air Force MX ICBM B-1 bomber Air Launched Cruise Missile B-52 modernization program KC-135 re-engine Ground Launched Cruise Missile F-15 air defense interceptor F-15 fighter F-16 fig h ter Maverick air-to-surface missile AIM-7M air-to-air missile C-5 wing modification C-5 strategic transport KC-10 cargo plane/tanker E-3A airborne warning aircraft Navy Trident missile submarine Nimitz-class aircraft carrier AEGIS CG-47 air-defense cruise r SSN-688 attack submarine FFG-7 frigate LSD-41 landing dock ship MCM mine countermeasure ship Oilers Standard SAM Tomahawk cruise missile Harpoon anti-ship missile F-14 fighter F/A-18 fighter/attack aircraft A-6E attack aircraft AV-8B attack aircraft EA-6 B electronic warfare plane P-3C ASW aircraft E-2C airborne warning aircraft AIM-54C air-to-air missile HARM anti-radiation missile SH-60B LAMPS I11 helicopter CH-53 helicopter 9 7 440 25 120 18 42 120 2,560 1,300 18 2 8 2 2 2 3 2 2 1 4 1 1,278 120 23 1 24 8 4 8 18 6 6 6 108 414 48 11 1,497.1 4,033.5 676.7 572.9 584.0 530.7 688.9 1,682.3 2,225.9 353.1 208.3 287.0 860.0 829.1 176.7 2,765.7 6,840.8 3,159.8 1,732.4 761.6 421.0 373.1 321.8 695.8 308.4 266.7 1,178.6 2 847.4 276.6 942.9 347.1 341.8 352.7 270.8 354. 6 212.0 311.0 In total, the Administration's FY 1982-FY 1983 defense budgets provide an additional 50 billion in weapons procurement and 7.7 billion in R&D over Carter FY 1981 spending levels.

This increase is funding the largest U.S. military buildup in p eacetime history systems is substantially higher than EY 1981 levels. (The one major exception is Air Force tactical aircraft Even so, as Chart IX shows, the Soviets are still outproducing the U.S. by wide margins in most weapons categories Procurement of almost all major weapons 18 Chart VI1 I WEAPONS PRODUCTION FY 1982-FY 1983 OVER CARTER FY 1981 LEVELS units procured B-1 strategic bomber MX ICBM Air launched cruise missile Ground launched CM Sea launched CM Pershing I1 M-1 tank M-2 infantry fighting veh i cle Multiple launch rocket system MLRS Copperhead laser guided artillery shell Stinger SAM Roland SAM Patriot SAM UH-60 utility helicopter AH-64 attack helicopter Hellfire laser anti-tank missile F-15 aircraft F-16 aircraft A-10 aircraft Sidewinder missil e Sparrow missile Maverick missile E-3A AWACS aircraft Trident SSBN SSN-688 attack submarine CVN nuclear aircraft carrier CG-47 AEGIS cruiser F'FG-7 frigate LSD-41 amphibious ship MCM mine countermeasures ship Auxiliaries F-14 aircraft F/A-18 aircraft A-6E aircraft EA-6B 'aircraft E-2C aircraft Sidewinder missile Sparrow missile Phoenix missile HARM missile 8 9 0 15 2 120 112 930 700 19,456 3,095 3,154 cancelled 292 59 59 4,651 40 150 40 4,220 645 3,050 0 0 3 2 2 1 1 5 5 12 53 14 9 0 760 430 210 408 19 Char t IX U.S.-SOVIET WEAPONS PRODUCTION Average Yearly Production 1980-1982 Weapons Type u.s Soviet ICBMs IRBMs SRBMs SLCMs GLCMs SLBMs ASMs SAMs ALCMs Tanks Armored Fighting Vehicles Towed Artillery SP Field Artillery Multiple Rocket Launchers SP AA Artillery Bombers Fighters/Fighter Bombers ASW aircraft Helicopters Submarines Major combatants (CVNs, VTOL carriers Minor combatants (missile boats, mine Aux i 1 i a r ie s cruisers, destroyers, frigates countermeasures 3 37 0 350 62 72 11,233 22,980 45 0 670 533 0 0 160 49 3 325 10 175 3 6 2 11 200 100 300 700 0 175 1,500 50,000 600 3,000 5,500 1,300 150 300 100 30 1,300 10 700 11 11 52 5 U.S. figures are for weapons authorized. Production in some cases is actually lower Soviet figures are those from 1975-

80. Soviet Military Power (Washington D.C Government Printing Office, 1981) pp. 12-

13. It is assumed that weapons production for 1980-1982 will match that for the earlier period Strategic Nuclear Programs U.S. strategic nuclear power is the foundation of the na tion's security. The Administration is requesting $16.2 billion in Fy 1983 for strategic nuclear weapons procurement and R&D, which amounts to less than 6.5 percent of the budget. Funding for major strategic programs includes 4.3 billion for development a n d initial procurement of nine MX ICBMs 4.8 billion for development and procurement of seven B-1 bombers (one B-1 was ordered in ET 1982 20 2.7 billion for procurement of two Trident nuclear submarines 366 million for development of the counterforce capabl e Trident I1 submarine launched missile 863 million for procurement of 440 air-launched cruise missiles to be deployed on B-52s 177 million for two E-3A airborne warning and control aircraft (AWACS 688 million for procurement of eighteen F-15 air defense i n terceptors 871 million for development of anti-ballistic missile systems 218 million for development of space defense systems 831 million to increase survivability and effectiveness 315 million to improve strategic communications systems of strategic surv eillance and warning systems; and An additional $389 million is requested by the Administration under the Federal Emergency Management Agency (FEMA) for civil defense.

Budget cutters have targeted a number of these programs for cancellation or reduction, i ncluding the MX missile, the B-1 bomber, the air defense programs, the civil defense programs, and one of the Trident submarines. All of the Administration's strategic nuclear programs, however, are necessary to implement U.S. nuclear strategy and will co ntribute significantly to the deterrence of nuclear war.

The 100 MX missiles to be deployed between 1986 and 1990 will give the U.S. a much improved counterforce capability although still much inferior to that of the USSR. As yet, however no program has be en initiated for basing the MX in a survivable mode, and unless U.S. ICBMs are made survivable, the Soviets will possess a potential nuclear "war winning" capability. Such a survivable basing scheme consisting, for example, of multiple shelters and an ABM system, would cost at the minimum $50 billion.

Meanwhile, as the U.S. procrastinates over solving the ICBM vulnerability problem, the USSR is building 200 modern high yield, highly accurate ICBMs a year. A new generation is under development that will mat ch the MX in accuracy. In addition older Soviet missiles removed from their silos to make way for new missiles, have not been destroyed but are being stored as a massive strategic reserve force 21 8 Even if its ICBMs were survivable, however, the U.S. wou l d be unable to carry out its nuclear strategy of controlled response because of the extreme vulnerability of its strategic comand control-communications network. The Administration plans 23 billion worth of improvements in this area. But many experts beli eve that spending will have to be substantially increased to achieve an adequate level of survivability and redundancy.

The ability of the U.S. bomber force to destroy assigned targets will be enhanced with the deployment of air-launched cruise missiles and the introduction of B-1 bombers in 19

86. The Stealth bomber, now in development, will be a better penetrating weapons platform than the B-

1. Nevertheless, procurement of the B-1 should proceed as planned. It is the only new bomber system that can be deployed in the 1980s, a period of urgent need when the Soviets will have strategic superiority, since Stealth will not be deployed until the 1990s at the earliest. And further unlike the B-1, the Stealth bomber will not be suited for carrying cruise miss iles or large quantities of conventional munitions.

Cancellation of the B-1, moreover, could well diminish the credi bility of the U.S. threat to Soviet strategic superiority, a threat which many U.S. defense experts believe is necessary to force the USSR into meaningful arms control negotiations.23 As the U.S. builds the B-1, however, the Soviet air defense network will be substantially upgraded with the deployment of new surface-to-air missiles (the SA-10 and the SA-X-12), AWACS type aircraft, and new in t erceptors with look-down/shoot-down radars and missiles.24 air space, the U.S. should buy more B-1s or develop an air-to-air defense capability for its bombers To ensure adequate bomber penetration of Soviet The Soviets understand the virtue of manned pen e trating bombers, which is to deliver nuclear weapons with precision on targets selected after on-the-spot reconnaissance. Indeed photographs recently have been released of a new Soviet strategic bomber in development and testing.25 will produce more of it s new bombers than the 100 B-1s planned.

Soviet bombers now have a "free ride" to their targets in the U.S. because of the meager capabilities of the American and Canadian interceptor forces.26 The Administration's procurement It is believed that Moscow 23 For a well-reasoned defense of the B-1 b omber, see Francis P. Hoeber Slow to Take Offense: Bombers, Cruise Missiles and Prudent Deterrence Washington, D.C Center for Strategic and International Studies, 1980 2nd ed Soviets Press Production, New Fighter Developments ,I1 Aviation Week and Space T e chnology, March 16, 1981, p. 61 Soviet Strategic Bomber Photographed at Ramenskoye I Aviation Week and Space Technology, December 14, 1981, p 17. See also Aviation Week and Space Technology, February 19, 1979, p. 14 Neglect of Bomber, Missile Defense Hit, " Aviation Week and Space Techno logy, August 20, 1979, p. 64 25 26 22 plans over the next five years for twelve more AWACs at $82 million a copy (for a total of 36) and five air defense squadrons of F-15 interceptors at $688 million per squadron are unfor t unate ly inadequate to prevent Soviet bombers from easily penetrating U.S. airspace.27 An effective defense requires more F-15 squadrons and at least ten more AWACs with a substantial proportion of the force kept on high alert cancel the Administration's a ir defense programs is to suppose that Soviet bombers add nothing to the military capability of the Soviet Union represented in its ICBM force. But, as noted above bombers provide valuable targeting flexibility during a war ly beyond the Administration's p lan for 4.2 billion over a seven year period. Civil defense funding is a prime target of budget cutters who feel that such programs would not be effective in a nuclear war and that planning to reduce nuclear war casualties somehow makes such a war more li k ely. Yet, all executive govern mental studies of civil defense programs conclude that serious evacuation planning along with a modest sheltering effort could reduce immediate deaths after a large-scale Soviet attack from about 160 million to as low as 20 m illion.28 Even if these figures are overly optimistic, however, civil defense serves, in addition, as a fundamental deterrent to nuclear war. For the Soviets emphasize civil defense in their war planning and will be less inclined to initiate nuclear war i f U.S. civil defense efforts match theirs.29 The fallacy of those who want to Civil defense spending also needs to be increased substantial Finally, the U.S. will have to boost production of its nuclear missile firing submarines (SSBNs) from the current on e per year to at least three per year to prevent the inventory of submarine launched missiles from shrinking as older subs are retired.30 In the meantime, the Soviets are building four SSBNs a year and are developing a hard-target capable multiple warhead S LBM that will be deployed five years ahead of the comparable American Trident 11 27 28 29 30 Air Force planners say that at least thirty-four (AWACs) planes would be required to set up a radar barrier around the North American continent Bonner Day AWACS i n Operation," Air Force Magazine, June 1979, pp 52-56 NATO air defense requirements for Europe are currently set at 18 AWACs.

Additional AWACs will be required for Persian Gulf contingencies, for a total of 50 For a review of these studies, see OTA op. cit pp. 94-95 Goure, op. cit.

The requirement for three missile firing submarines a year assumes that the U.S. continues to build 24-tube Trident boats. However, in light of increasing Soviet ASW capabilities, perhaps the U.S. should consider designing small er submarines with fewer tubes to present more targets to Soviet planners. For a statement of the argument that the Navy should distribute its offensive capability across a larger number of platforms see William R. Van Cleave Strategy and the Navy's 1983- 1 987 Program Skepticism Warranted Armed Forces Journal (April 1982 pp. 49-51. 23 Theater Nuclear Programs In response to Soviet deployments of Backfire bombers and multiple warhead SS-20 ballistic missiles (now numbering over 900, with 300 launchers and 2, 700 warheads NATO decided in 1979 to modernize its theater nuclear force by deploying 108 Pershing I1 ballistic missiles and 464 ground launched cruise missiles GLCMs) in Europe between 1984 and 19

88. In E'Y 1982, the U.S. is spending $804 million on the development and procurement of 21 Pershing 11s and 54 GLCMs. The FY 1983 budget requests $1.2 billion for development and procurement of another 91 Pershing 11s and 120 GLCMs (cost of warheads not included). Procurement of enhanced radiation warheads (ERW s )--the so-called neutron bomb--for short-range Lance missiles, for which there are 72 launchers in Europe, and 8-inch artillery shells will continue in FY 1983, but these are not being deployed abroad effort is being funded to improve NATO's short-range m issile capability nuclear missile launchers a year to fire missiles of all ranges.

Indeed, Soviet improvements in tactical nuclear capability repre sented in the deployment of the SS-21, SS-22, and SS-23 missiles are a far greater threat to NATO forces tha n the much more publi cized SS-20 modernization program is of negligible military value. The systems will be vulnerable to quick Soviet preemptive strikes.

And 80 percent of the new systems are subsonic cruise missiles which, in flight, are significantly more vulnerable to Soviet air defense than are ballistic missiles. To credibly deter the Soviets from using nuclear weapons in Europe or other theaters the U.S. must No major The Soviets meanwhile are building 400 theater By comparison to the Soviet effor t NATO's theater nuclear deploy ERWs in Europe; triple the deployment of Pershing 11s and GLCMs; develop, produce, and deploy 200 to 300 short-range ballistic missiles; upgrade Patriot to be used as an anti-tactical ballistic enhance the survivability of t h eater nuclear forces in missile weapon; and Europe through such means as more rapid dispersal proce dures 31 U.S. ground based nuclear weapons in Europe, which are stored at only a handful of sites, are extremely vulnerable to destruction by a quick Sovie t strike. For political reasons, techniques such as peacetime mobility or deceptive basing using multiple aim points are not viable survivability options In effect, survivability depends on early dispersal to the field and, once there, on mobility and elec t ronic deception. 24 These force improvements, however, will be futile if the U.S. does not begin to think more seriously about how nuclear weapons might be used in Europe or the Middle East and to under take detailed operational planning and training for nuclear warfare.

Army Programs The U.S. Army is in the early stages of a $241 billion modernization effort that has been delayed first by the 1964-1973 Vietnam War and then by the defense budget crunch of the 1970s.

Ten new systems are now in production: the M-1 tank, the M-2 infantry fighting vehicle, the MLRS rocket system, the Copperhead laser guided artillery shell, the Stinger and Patriot surface-to air missile systems, the DIVAD air defense gun, the UH-60 utility helicopter, the AH-64 attack helicop ter, and the Hellfire laser anti-tank missile.

Production for some weapons is substantially above levels proposed by the Carter Administration, but overall production of Army weapons still lags far behind the USSR. There are, moreover significant shortages of war reserve equipment and ammunition.

The Soviet Union meanwhile continues to modernize its forces with the deployment of new weapons that effectively negate a good share of U.S. force improvements. Among the new Soviet arms are a new battle tank, the T-80, equal in performance to the M-1 high velocity artillery rounds that can penetrate M-1 armor, more accurate, more lethal, longer-range anti-tank missiles, longer range, ECM resistant SAMs, and a new version of the HIND attack helicopter armed with " fire-and-forget" anti-tank missiles.

There is much talk on Capitol Hill of cancelling or scaling back procurement of a number of the Army's new weapons systems such as the M-1, the M-2, and the AH-64, because of performance defects, maintenance problems, a nd cost overruns. The new systems coming off the production line now are admittedly not as good as the Army originally had hoped. Yet, despite the mostly minor flaws, they, in general, are significantly more effective than their predecessors. Congress sho uld examine any proposal that reasonably promises to match the military capability of new weapons with cheaper alternatives.

In most cases, however, there is no cheaper force mix of equivalent capability. It has been proposed, for example, that the Army re ly on AH-1s attack helicop ters instead of buying the more expensive AH-64, but the former system cannot operate at night, in hot temperatures, or in bad weather, it has less payload, and it cannot fire the Hellfire missile.

The critical issue remains a d rastic expansion of the Army's war-fighting capability in Europe soon, with or without new model weapons. Ground air defense particularly must have more resources than the Reagan defense budgets allocate. The Soviet capability for close air support of gro u nd operations and deep strike inter25 Chart X SHORTAGES IN ARMY WARTIME EQUIPMENT LEVELS Items Personnel carriers TOW carriers Cargo carriers Quantity Short Against Go- to- Wa r Requirements Unit Equivalent S ho rt age s 2,888 698 404 49 Mechanized Infant r y Battalions 32 Mechanized Infantry Battalions 22 Field Artillery Battalions Tanks 2,146 40 Tank Battalions Howitzers, 8 In. SP Howitzers, 155 SP 204 237 17 Field Artillery Battalions 13 Field Artillery Battalions Source: Statement of Senator John Tower B efore Committee on the Budget, U.S.

Senate, March 18, 1982 diction has improved dramatically over the last ten years with the deployment of HIND attack helicopters and new fixed-wing aircraft, such as the MiG-27 and the Su-24 (an aircraft similar to the U.S. F-lll), equipped with sophistica t ed air-to-surface precision-guided missiles. Reportedly, the Soviets also have an A-10 type "tank buster" airplane ready for deployment as well as two new high performance fighters, one an air-superiority F-15 type aircraft.32 NATO air forces to sweep the skies clear of Soviet intruders and to help disrupt the Soviet ground attack. With recent improvements in Soviet air forces, NATO has lost its edge in the air. According to General Charles A. Gabriel, new Air Force Chief-of-Staff, NATO air superiority is p ossible only if Itwe can use standoff tactics and engage them [the Soviets] beyond visual range, outnumbered seven to one. We would lose that edge if visual identification is required before each Unfortunately, this condition is unlikely to obtain because NATO aircraft lack an effective identi In the past, NATO ground forces have counted on 32 "Soviets To Field Three New Fighters in Aviation Modernization Drive,"

Aviation Week and Space Technology, March 26, 1979, p. 54. "Soviets Develop Top Warplanes: U.S . Air Chief Chicago Sun-Times, May 24, 1982 D. 28 33 Quoted in "Burgeoning Warsaw Pact Threat Spurs Dual Challenge Aviation Week and Space Technology, June 2, 1982, p. 44 26 fication-friend-or-foe device (IFF) that pinpoints enemy aircraft beyond visual r ange.

To prevent its troops from being decimated by Soviet air attacks, the U.S. Army will have to procure substantially more SAM systems, including the European Roland which the Administra tion is buying in only very limited quantities.

More weaponry, ho wever, is not the sole solution to the Army's problems being too rigid, too centralized in execution, and too focused on achieving victory through attrition warfare. Critics have urged the Army to adopt a manuever style of warfare that seeks victory throu g h surprise and fast paced actions designed to throw the enemy into confusion.34 In recognition of the validity of these ideas, the Army has rewritten its field manual and drawn up a new battle. plan IIAirland Battle 200011 based on manuever warfare 35 But the Army needs to be watched closely to ensure that these documents represent a genuine revolution in strategic thinking and not just a political ploy to silence criticism Strategy and tactics have been criticized as Tactical Air Force Programs The Admini stration is planning to increase its tactical fighter strength with the formation of four new fighter wings.

Funding in FY 1982 and FY 1983, however, has gone solely to modernize existing forces. Ironically, procurement of Air Force tactical fighters in FY 1982 and FY 1983 will drop below that of the two previous years during which 379 and 282 fighters were procured. The Air Force bought only 216 fighters in FY 1982 and is requesting only 182 in FY 19

83. At the same time, the Soviets are building 1,300 good quality fighters a year, with three new models in testing stages.

How can the U.S. hope to achieve air superiority with such an asymmetrical effort overcome numerical inferiority by designing more technologically sophisticated aircraft to achieve highl y favorable exchange ratios against their Soviet counterparts. Technological fixes in development or initial production to maintain technological superiority include: AMRAAM, a beyond-visual-range radar guided missile; LANTIRN, an infrared imaging system a llowing U.S. fighters to attack land targets at night and "under the weather and an advanced infrared-imaging version of the Maverick air-to-surface missile The Air Force traditionally has tried to I 34 35 See, for example, Edward Luttwak The American Sty le of Warfare and the Military Balance I' Survival (March/April 1979 pp. 57-60.

John Fialka Army Shifts Strategy to Give Smaller Units Room to Manuever,"

Wall Street Journal, January 22, 1982, p. 1. 27 The effectiveness of thebe programs, however, is not assured.

Some military experts question the value of AMRAAM in the absence of a viable IFF system and in the presence of Soviet anti-radar missiles that would home-in on the radar emissions needed to guide U.S. missiles.36 Testing of all these systems has been artificial and hardly representative of authentic battlefield conditions.37 Fans of the F-16 are especially upset with Air Force plans to deploy LANTIRN, a $5 million system, on an airplane designed as a low cost day fighter.

Critics deserve a fair hearing by Congress to help determine the true effectiveness of Air Force modernization programs. But whatever the verdict, the Air Force needs far more fighters than the numbers called for by the Reagan budgets--four more fighter wings at the minimum--to offset Soviet tactical modernization programs, which are proceeding at a faster pace than in the West and to provide sufficient numbers of planes to meet the require ments for both European and Persian Gulf contingencies Current ly those fighters assigned to the Rapid Deployment Force are also earmarked for Europe Naval Proqrams The Administration's military policy correctly calls for naval superiority. If'the West is to avoid defeat in Europe or South Asia it is essential to secure the sea lanes for trans port ing reinforcements to overseas theaters and to keep the Soviets from outflanking NATO in the North Atlantic and Mediterranean.

To offset Soviet advantages in ground and tactical air forces in Europe and South Asia, the West will also have to rely heav ily on naval strike power (aircraft and cruise missiles To achieve naval superiority, the Administration wants to expand U.S. naval forces by 1990 from thirteen to fifteen carrier battle groups, from zero to four Ilsurface action groups" (SAGS organized a round reactivated battleships, from eight to ten underway replenishment groups, and from 90 to 100 attack sub marines. In addition, the Navy intends to increase Marine lift capability by 50 percent.

Major ships to be procured over the next five years inclu de six Trident ballistic missile submarines; seventeen Los Angeles class attack submarines; two 90,000 ton, 90-aircraft nuclear powered Nimitz-class aircraft carriers; eighteen AEGIS air defense 36 This point is made by Pierre M. Sprey, former Special Ass istant in the Office of the Secretary of Defense and research scientist for Grumman Aircraft and now defense consultant, in his briefing "Comparing a Quarter Century of Fighters: F-100 to F-18."

For a disturbing illustration of this with regard to the Air Force Maverick missile, see the three-part series of articles in the Washington Post February 23, 24 and 25, 1982) by Morton Mintz 37 28 cruisers and four guided missile destroyers to protect ai r craft carriers from Soviet air launched cruise missiles; twelve guided missile frigates to be used in low threat environments; twenty-four mine countermeasure ships; ten amphibious landing dock ships; and forty-seven auxiliary ships. Total cost of the Nav y 's FY 1983-FY 1987 shipbuilding program 80 billion In addition, the Navy wants to buy some 1,917 aircraft over the next five years, including 144 F-15 air defense interceptors at $49 million per copy and 552 F/A-18 light attack aircraft at 33 million each , as well as 750 cruise missiles for deployment on attack submarines, surface ships, and aircraft. One-third of the cruise missiles will be used for tactical anti-ship missions one-third for tactical land attack missions, and one-third for nuclear strike m i ssions. The cruise missiles will greatly improve U.S. ship-to-ship missile capability, an area in which the Soviets now lead. Long-range nuclear cruise missiles will enable the U.S. to offset some of the Soviet advantages in theater nuclear missiles. Thes e programs should be given the highest priority.

But the Navy's planned force buildup, though large, is insufficient to meet wartime mission requirements In the view of professional na'val planners, true maritime superiority would require twenty-two carrie r battle groups and 130 attack submarines for high confidence in carrying out wartime strategy.38 not "pie in the sky" Pentagon planning. In a global war the Soviets could deploy some 50 cruise missile submarines, 125 attack submarines 70 major surface wa r ships, 50 Backfire bombers equipped with anti-ship cruise missiles, 168 Badger bombers similarly equipped, 50 Ifiron bombll bombers, and 126 anti-submarine aircraft against U.S. naval forces consisting of eight or nine aircraft carriers 60 surface escorts , 490 carrier-based aircraft and 63 attack submarines.39 The Navy's force expansion plans will add one carrier battle group and two to three surface action groups to U.S. forces deployed in wartime. On average, then, the Soviets could deploy against each c a rrier battle group cruise missile submarines, sixteen attack submarines, eight Backfire bombers, and 29 Badger bombers armed with long-range cruise missiles.40 Soviet forces, of course, could be concentrated to increase the odds of sinking particular carr iers This is six 38 For carrier requirements, see Wilson U.S. Defense Paper I op. cit.

For submarine requirements, see statement by Vice Admiral J. G. Williams USN, Deputy Chief of Naval Operations (Submarine Warfare in Hearings on Military Posture and H.R. 2970, Part 3, p. 216.

These figures represent 70 percent of the U.S. and Soviet naval forces that portion which it is assumed would be ready for combat after several weeks mobilization. Frigates and small missile boats are not included. U.S. forces coul d be augmented by some 86 ocean and coastal attack sub marines, two ASW carriers, one small attack carrier, 40 guided missile destroyers, and 28 gun destroyers, from NATO, Japanese, and Australian navies.

It is unlikely that the Soviets will use their sur face warships to directly attack U.S. carrier task forces, although they do have one Kirov class strike cruiser and eight smaller cruisers equipped with anti-ship missiles 39 40 29 Large-deck carrier battle groups dispose an awesome offensive strike power , and they are formidably. defended by F-14 interceptors 24 per carrier battle group air defense missile ships, and various anti-submarine detection devices and weapons. The effec tiveness of such systems against a coordinated Soviet barrage attack of torp e does and air and sea delivered cruise missiles is however, unknown.41 Many experts are skeptical and foresee heavy losses, especially if the Soviets use nuclear weapons.42 The solution to the threat facing U.S. carrier task forces is not to build less cap a ble smaller carriers that would suffer even heavier. attrition if used offensively in "high threat environments It is rather to build more large-deck carriers and to improve task force air defenses with the deployment of more effective look-down airborne radars to detect cruise missiles short-range anti-cruise missile missiles, such as the British Sea Wolf, and long-range anti-submarine weapons.

But even to achieve its more modest objectives, the Admini stration will have to spend far.more than is planned. According to a recent Congressional Budget Office study, to meet its force objectives by 1992, the Navy will have to authorize for construc tion or conversion 176 ships between EY 1982 and FY 1988--29.3 per year--for a total cost of $119 billion, or $23. 8 billion a year.43 wings--$11.2 billion--or personnel and operations costs related to the force expansion This does not include the costs of two carrier air The Administration's Five Year Shipbuilding Plan, however funds only 149 ships at a cost of $80 bi l lion with procurement of over one-half of these ships delayed until M 1986 and FY 1987 41 42 43 Contrary to popular analyes, the loss of British surface ships to Argentine air delivered anti-ship missiles in the Falkland Islands war does not signal the en d of surface navies part of a large deck carrier task force with their extensive air defense capability. On the other hand, the Exocet firing Argentine Entendard aircraft hardly represent the magnitude of the Soviet air and submarine launched cruise missil e threat.

There are at least two reasons why the Soviets might use nuclear weapons at sea against U.S. aircraft carriers: first, their military doctrine stresses that a major war between the U.S. and the USSR will almost certainly involve large-scale use o f nuclear weapons and that by using them first the USSR would reap enormous military advantages. Second collateral damage from nuclear war at sea would be slight. For a discus sion of the nuclear threat to U.S. naval forces, see Joseph Douglas and Amorett a Hoeber, "The Role of the U.S. Surface Navy in Nuclear War U.S Naval Institute Proceedings (January 1982 pp. 57-63; and Linton Brooks Tactical Nuclear Weapons Naval Institute Proceedings (January 1980 pp. 23-28.

Congressional Budget Office, Building a 600 Ship Navy: Cost, Timing, and Alternative Approaches, March 1982 British warships were not operating as The Forgotten Facet of Naval Warfare U.S. 30 Indeed, the FY 1982 shipbuilding/conversion budget amounts to only 9.6 billion and funds only 22 ships. Th e FY 1983 budget is 18.7 billion and funds 23 ships.

As with the Army and the Air Force, the Navy's force problems cannot be solved simply by buying more ships. If the U.S. Navy is to survive for more than a few hours against a Soviet attack it must dramat ically improve its capability to fight a nuclear war It must also switch to more effective tactics based on force dispersal, minimal use of radar, and greater use of electro nic deception.44 Rapid Deployment Forces U.S. capability to rapidly deploy ground forces in the Persian Gulf will not improve significantly in 1982-19

83. The Administration wants to procure 50 C-5N transports for $8 billion and 44 KC-10 cargo/tankers for $3 billion between 1982 and 1986 which will increase by 50 percent U.S. airlift c apability to the Gulf, making it possible to airlift three light brigades to Southwest Asia in two weeks. The first requests in FY 1983 are for two C-5Ns at 860 million and eight KC-10s at $829 million.

The Reagan Administration is also continuing to fund two Carter strategic mobility programs: the lease of eight SL-7 fast container ships capable of transporting the equipment of one U.S Army mechanized division to the Persian Gulf in fifteen to nine teen days; and the purchase of twelve Maritime Pre-posit ioning Ships to hold the equipment and thirty days worth of supplies for a Marine division.

These programs would allow the U.S. in the late 1980s to deploy three divisions to the Gulf in four weeks: two 'Ilightl divisions, the 82nd Airborne (17,000 men) an d a Marine Corps division plus air wing 50,000 men and one Ilheavyll U.S. Army mechanized division 25,000 men). While sufficient to deal with local threats, these forces would lack the firepower and mobility to thwart a Soviet invasion of the Gulf. Moreov e r, the U.S would still be short of rapidly deployable forces to seize criti cal strategic assets before the arrival of Soviet airborne divi sions. Stationing a full Marine division on assault ships in the Indian Ocean, as some have proposed, would greatly enhance the RDF's capability for quick forced entry" amphibious operations along the Indian Ocean littoral.45 However, deploying 50,000 Marines at sea for a lengthy period would badly damage troop 44 The U.S. Navy relies heavily on powerful, continuous em itting radars to scan the skies and horizon for enemy ships, aircraft, and cruise missiles and to destroy these with radar guided missiles. As such, U.S. fleets are extremely vulnerable to Soviet anti-radar missiles. See Thomas S.

Amlie, "Radar: Shield or Target IEEE Spectrum (April 19821, pp. 61-65 45 Record, op. cit p. 74. 31 morale and impair combat skills. For true rapid deployment, the U.S. will probably have to rely on airlifted troops. It is unnecessary to match Soviet ground forces in South Asia wi t h airlifted troops, but U.S. airlift capability needs to be expanded beyond current plans. Airlifted troops also need to be equipped with more armor and mobile air defense systems. The Army is requesting 210 million in FY 1983 for procurement of 392 Light Armored Vehicles, although disagreement with the Marine Corps over a common system has delayed a final production decision.

Funding for mobile air defense systems for the RDF is minimal and should be substantially increased, in light of Soviet superiority in tactical air forces. If the U.S. wants to defeat a large-scale Soviet invasion of the Gulf, it also will have to signifi cantly increase its sealift assets.

THE PRICE OF SECURITY How much, then, will it cost for the U.S. to buy the military power needed to defend its interests against the Soviet challenge?

Merely to maintain America's armed forces at inferior 1980 force lev els requires an annual procurement budget of $70 billion.46 To this must be added the costs of upgrading forces with new improved weapons, which increases procurement costs by about 6 percent a year in real terms.47 The cost of "steady state modern izatio n" for the E'Y 1981-FY 1983 period would thus total $222.9 billion and $587.8 billion for the FY 1981-FY 1987 period.

Actual expenditures in FY 1981-FY 1983, however, will be at the most only 214.2 billion for a shortfall of $8.7 billion. Thus the U.S. is currently not even spending enough on defense to maintain forces at a constant inventory level. Only with the further 8 percent increase in defense spending next year will the procurement budget begin covering force modernization costs Chart XI PROCUREMEN T FUNDING FY 1981-FY 1983 FY 1983 Dollars 1981 1982 1983 Total Actual 54.8 69.8 89.6 214.2 Cost including Modernization 70.0 74.2 78.7 222.9 46 The replacement cost of the U.S. arsenal in 1980 was $1.75 trillion (FY 1983 dollars Assuming an average 25 year service life 70 billion must be spent annually to maintain U.S. forces at a constant inventory level.

Leonard Sullivan National Security Strategy and Defense Investment in From Weakness to Strength: National Security in the 1980s, edited by W.

Scott Thom pson (San Francisco: Institute for Contemporary Studies 1980), p. 343 47 A further of procurement major problem underfunding. is the dismal legacy of two decades Between 1962, when the U.S. enjoyed a substantial degree of military superiority over the Sov iet Union, and 1980, $2.7 trillion would have been required to modern ize and maintain U.S. forces at 1962 levels. Actual expenditures however, totaled 1.8 trillion for a shortfall of $900 billion.

Since 1970, when the U.S.-Soviet military balance stood at rough parity, U.S. procurement budgets have been underfunded by about 350 billion. To recoup the force degradation suffered since 1970 and to keep the present force modernized would cost $940 billion over the next five years. Yet the Administration plans to spend only about $720 billion on procurement during this period.

Finally, there is the serious problem of rising weapons costs. In 1981 alone, the cost of the Pentagon's top 50 weapon systems grew on the average by 34 percent because of design changes, schedule changes, production cost misestimates, and greater than expected inflation.48 Because these overruns are not covered by supplemental budgets, the Services in some cases are buying fewer weapons than authorized. The Army's AH-64 attack helicopter program, for example, has experienced huge cost overruns, and funding appropriated in Fy 1982 to buy fourteen aircraft will now buy only eleven.

To more accurately estimate costs, the Pentagon has mounted an effort to maintain strict procurement schedules , use higher production cost estimates, and use higher inflation figures for tracked combat vehicles, aircraft, ships, and missiles. These and other measures associated with the Defense Department's new acquisition policy, such as multiyear contracting an d funding to improve the productivity of the defense industry, have added 13.5 billion to the FY 1983 defense budget without buying a single new weapon.49 Nevertheless, the Congressional Budget Office believes that the Defense Department still has underest imated production costs 48 49 The Pentagon has received much criticism of late for so-called cost overruns of its weapons programs, not all of it deserved. Weapons costs are reported publicly in DoD's quarterly Selective Acquisition Reports.

These show cos t increases or decreases due to: inflation, new estimates of production costs, design changes, schedule changes, and changes in the number of weapons to be procured. Over 80 percent of the huge cost increases in weapons programs reported for the 1980-1981 period was due to unanticipated inflation and schedule changes. The recently reported quarterly increase of 33 percent, the largest rise ever reported, is not due to bad management but rather reflects for the most part larger quanti ties of weapons to be procured by the Defense Department Pentagon Says Biggest Weapons Projects Expected to Cost 33% More Than Forecast Wall Street Journal, March 22, 1982, p. 10.

Aviation Week and Space Technology, February 22, 1982, p. 59 Walter Mossberg, 33 by 48 billion over the next five years, and that the Administra tion's defense budgets fail to cover about $61 billion worth of inflation.

In sum, to fully fund an adequate defense capability as discussed in this paper, the Administration's defense budgets for EY 1983-FY 1987 will have to be augmented by several hundred billion dollars.

COST-SAVINGS MEASURES The defense budget must be structured to meet America's military requirements. Nevertheless, it is essential that the Administration also impose efficiencies and othe r cost-savings measures to defuse a growing popular feeling that the Pentagon wastes taxpayer dollars--a sentiment that gravely threatens the pro-defense consensus In fact, at least $5 billion in savings per year can be found through various operational e fficiencies price adjustments, and pay caps.

Operational Efficiencies In FY 1982, the Defense Department reportedly achieved savings of $900 million by improved economy and efficiency in operations. Another 1 billion in savings is planned in EY 1983 through restricting travel, reducing consultant contracts, and consolidating base support functions. From FY 1981 to FY 1987 the Pentagon expects savings of $6.9 billion which have already been taken into account in formulating the FY 1983-EY 198 7 budgets Additional savings of about $400 million annually would be made possible by repeal of the Davis-Bacon Act of 1931, which has the effect of increasing federal construction costs.52 Another 100 million could be saved through further base restructur i ng along the lines of a 1979 Defense Department proposal ignored by ongress.53 See statement by Alice Rivlin, Director of the Congressional Budget Office, before the Senate Appropriations Committee, February 25, 1982, p 13; and "A Small Matter of a $100 B i llion Shortfall," National Journal March 27 1982, p. 548 51 Office of the Assistant Secretary of Defense (Public Affairs Economy and Efficiencies in the Department of Defense," News Release No. 51-82 52 William J. Lanoutte Foes May Use Salami Tactics to W i pe Davis-Bacon Act Off the Books National Journal, September 5 1981, p. 1587 53 Congressional Budget Office, Reducing the Federal Deficit: Strategies and Options, Part I11 (Washington, D.C.: U.S. Government Printing Office 1982 pp. 51-52 51 34 Price Adjus t ments With oil prices declining, the Pentagon's fuel outlays in Fy 1983 could be $220 million less than originally budgeted. If Fy 1982 fuel savings are applied to the FY 1983 budget, another $900 million will be saved. In addition, the Foreign Currency T ransac tion Fund, established in 1979 to protect DoD's overseas operations from adverse fluctuations in the value of the dollar, contains 300 million that can be applied to other defense programs if the dollar continues to be strong.

Pay Caps Forty percent of the defense budget goes for military civilian, and retirement pay. The Senate has approved a freeze on civilian pay and cost-of-living adjustments, as well as a limitation of increases to 5 percent for FY 1983 savings of $3.7 billion. The r e are still significant shortages in some military job specialties and additional compensation may be needed to fill these. But many defense.experts believe that a 5 percent pay increase should be sufficient to sustain improve ments in both enlistment and retention of the All Volunteer Force.

Another high cost in the defense budget is the generous military retirement system. The Congressional Budget Office has outlined a number of reforms in the system that could net $3.5 billion in savings over the next f ive years.54 In no way should the possibility of $5 billion in defense savings be considered an appropriate rationale for reducing the overall defense budget. Because the budget is so inadequate savings should be turned back in to fund needed weapons or p ay for improved training and maintenance.

Instead, Congress is cutting the defense budget without trimming fat. Of the 8.7 billion in cuts approved so far in the EY 1983 Senate Authorization Bill, over $5 billion is the result of reductions in weapons proc urement and R&D funding, including 1.5 billion from cancelling the MX ICBM, $255 million out of development funds for a survivable ICBM basing mode, $107 million from civil defense, $251 million to retire all B-52D bombers 697 million by delaying procurem e nt of the AH-64 helicopter 324 million for cancelling purchase of 20 A-10 close air support aircraft, $200 million off ballistic missile defense, $95 million through early retirement of thirteen destroyers, $450 million by cutting in half procurement of t h e LAMPS I11 ASW helicopter, and 150 million to slow production of the Navy's anti-radiation missile 54 CBO, op. cit pp. 49-51. 35 DEFENSE SPENDING AND THE ECONOMY Many in Congress seek such large cuts in the defense budget because they fear that the Admin i stration's $1.6 trillion rearma ment program will severely damage the economy. They are listening in particular, to economists such as MITIS Lester Thurow, who argue: that the defense budgets will add significantly to the federal deficit and thereby prolo n g the recession by keeping interest rates high; that increased weapons production will divert high technology production capability and skilled manpower away from the consumer sector leaving the U.S. in a weaker position vis-a-vis competition with foreign businesses; that the drain on materials will also cause significant inflation. ss These arguments are overstated. Consider first inflation.

In their report to Congress on the FY 1983 budget, the President's Council of Economic Advisers acknowledged that " the substantial transfer of resources in the durable sector to defense production may increase relative prices in at least some of the affected industries.lIs6 However, the CEA went on to say, 'Ithe U.S. economy as a whole should be able to accommodate th e projected expansion in.defense spending without experiencing an increase in the general inflation rate.lIs7 This is certainly true historically.

When, during the Eisenhower and Kennedy Administrations, defense spending consumed 9 to 10 percent of the Gro ss National Product inflation was slight. As a matter of fact, inflation soared during the 1970s--at the very time that defense spending declined temporary crowding out of private investment,'I but in the long term it need not have an adverse effect on gr o wth in the consumer sector, as history again shows.58 From 1953 to 1972, the economy grew by 5 percent a year in real terms. During the 1953-1960 period, defense spending averaged 9.5 percent of GNP, and from 1961 to 1972, 8.0 percent. By comparison, unde r the Reagan Five Year Defense Plan for FY 1983-FY 1987, defense spending as a percentage of GNP will rise from a mere 6.3 percent in FY 1983 to only 7.4 percent in FY 19

87. The enhanced defense budget recom mended in this paper would raise the defense pe rcentage of GNP by at most a further 1.0 percent The CEA admits that the military buildup may lead to "some 5s For these arguments, see Lester Thurow Beware of Reagan's Military Spending New York Times, May 31, 1981, p. F3; and Joint Economic Commit tee S taff Study, The Defense Buildup and the Economy, February 17, 1982.

Council of Economic Advisers, Economic Report of the President, February 1982, p. 86 s6 57 Ibid 58 Ibid 36 Chart XI I I DEFENSE SPENDING AS PERCENTAGE OF GNP: 1953-1980 Calendar Years GNP 1953-56 average 1957-60 average 1961-64 average 1965-68 average 1969-72 average 1973-76 average 1977-80 average 10.2 8.7 8.4 8.1 7.7 5.7 5.1 As for the deficit, its relation to defense spending is, in general, misunderstood. The difference between a 3 per cent real growth in defense--the nation's commitment to NATO--and the Administration's budget is $20 billion in outlays in FY 1983.

This $20 billion would raise the national debt of slightly over 1 trillion by 2 percent. Adding another $20 billion to the defense budget in FY 1983 to bring funding more in line with military requirements would raise the national debt by 4 percent.

The impact.of this increase on interest rates would be relatively slight. The main reason for high interest rates today is not th e deficit, but the erratic and inconsistent monetary policy of the Federal Reserve Board. Japan and Germany are both running deficits which amount to a far larger percentage of GNP than does that of the U.S yet they are still experiencing healthy growth. Their secret: tight monetary policies and higher rates of savings among consumers.

Domestic economic conditions are legitimate concerns in determining the size of the defense budget A stable and growing eocnomy is essential for a popularly supported foreig n and military policy. The Administration's defense budgets, however, do not threaten the economy with collapse. But Soviet military power if not immediately countered, could well destroy the basis for any I1freeIf economy at all.

DEFENSE SPENDING AND SOC IAL WELFARE A frequent criticism in l1Op-Edlf pages is that the Administra tion's defense buildup is being financed at the expense of the poor, the elderly, the handicapped, and so on. This plainly distorts the facts. Over the next five years, the proport ion of the federal budget devoted to defense will rise from 25.9 percent to 37.2 percent, a level last recorded in 19

71. At the same time, the share of the federal budget going for welfare entitlement programs will remain at 44.8 percent. In fact, entitle ment programs will grow by 1.5 percent a year in real terms under the Reagan budgets 37 Admittedly, entitlement growth will be heavily weighted in three program areas--Social Security, Medicare, and Medicaid--and funding for some entitlement programs will be reduced. But the cuts amount overall only to a 5 percent reduction in E'Y 1982 spending levels. Second, they are not occurring in programs that help the very poor or needy. Third, the shift in spending emphasis in the federal budget comes after two dec a des of massive entitle ment growth and shrinking defense budgets. In 1960, defense consumed 50 percent of the federal budget, human resources 23 percent. In 1980 the percentages were roughly reversed--26 percent for defense, 53 percent for human resources . During the decade of the 1970s, as the Soviet defense budget grew by 4 percent a year, U.S. defense spending increased in real terms by only 1.4 percent, while social spending soared by 4.9 percent a year.

CONCLUSION In pursuit of the military superiority consistent with their overall political objectives, Soviet leaders have put their nation's economy on a semi-mobilized war footing, devoting close to 15 percent of Soviet GNP to defense at the cost of depr iving their citizens of commonplace conveniences and semi-luxuries enjoyed by all Western societies. At the same time, the U.S.

Congress balks at raising defense spending to 6.3 percent of GNP raising serious questions about the determination of free societies to stand up to the national will of communist states.

Under pressure to do something about the economy and seeming ly without due consideration of the Soviet threat, Congress is prepared to cut the Administration's defense budget. This action will as sure U.S. military inferiority throughout the decade and will place the security of the U.S. in the hands of Moscow. If Congress genuinely desires such cuts in the defense budget, the members should openly admit to, and take responsibility for, the inevit able reductions in military commitments, worldwide, which would follow from this. Such a retreat is hardly consistent with America's role as leader of the free world.

The FY 1983 defense budget debate has focused thus far almost exclusively on the economic s of defense. It is time now to consider the budget in terms of military requirements, stable deterrence, and the realities of the Soviet threat. The decade of the 1980s will be one of high risk for the security and freedom of the United States and all th e Western world. Already Soviet military superiority threatens to blackmail the West into submis sion. As they stand, the Administration's defense budgets cannot reverse the West's military decline. If substantially more dollars are not allocated for defen se immediately, Soviet military power will be overwhelming by the late 1980s, the Kremlin's objectives will be realized--without the risk of war.

Robert Foelber Policy Analyst


Richard McKenzie