384. Letter From the Director of the Bureau of the Budget (Gordon) to the Administrator of the National Aeronautics and Space Administration (Webb)1

Dear Mr. Webb:

As you know, the chronic balance of payments deficit of the United States has become a source of increasing concern to the President. The urgency which he attaches to the program has been manifested in his public statements, in meetings with business and labor leaders, and in his instructions to officials of the executive branch to take positive steps to reduce wherever possible the level of Government expenditures abroad. As part of this effort, the Bureau of the Budget has recently conducted a special review of all offices and missions overseas based on reports submitted by agencies under Bulletin 63–13. We believe that we have identified a number of actions which, if taken, might have a favorable impact on our balance of payments. Although these various agency actions may not, in all cases, appear to offer dramatic balance of payments savings individually, in the aggregate they could result in a [Page 876] significant reduction in our overseas expenditures. For this reason, I commend the issues noted below to your personal attention.

I realize that, with one or two exceptions, all NASA offices and missions abroad are comprised of tracking and data acquisition stations which have been established to support NASA space flight missions, and that very limited flexibility exists within which action can be taken to reduce these activities without affecting the flight programs. I also realize that any substantial changes may have an impact on existing international agreements or negotiations now in progress. Nevertheless, in view of the gravity of our balance of payments problem, serious consideration should be given at this time to actions affecting the balance of payments despite the circumstances noted above.

Therefore, it is requested that you have your staff conduct a detailed study to identify the effects on NASA programs, total FY 1964 costs, and on the balance of payments, of the actions listed below, plus any others which you may suggest as promising some alleviation of the balance of payments problem. Such studies should be completed by September 15, 1963. These studies, together with parallel information on the international relations aspects of the suggested actions, would provide us with better information on which to base judgment than that developed to date. The actions which we suggest, based on the preliminary information currently available, are as follows:

Reduce the tracking stations at Kano, Nigeria, and Zanzibar in Africa to standby status in view of the termination of the Mercury series of flights and the stated NASA plan to place primary reliance on other stations for the Gemini flights.
Defer the planned personnel increase at the Johannesburg, South Africa, Minitrack station until FY 1965 or later, retaining the station at its present complement of about 59 employees.
Abandon the present plan for establishing a NASA office in Paris.
Close the Mercury tracking station in Muchea, Australia, in view of the termination of the Mercury program and the construction of a new primary Gemini station at Carnarvon.
Close the Mercury station at Quaymas, Mexico, in favor of conducting the Gemini tracking from some point within the borders of the United States, such as Point Arguello, California, White Sands, New Mexico, or Corpus Christi, Texas.
Close the Minitrack station at Autofagusta, Chile, in favor of tracking from other stations in the Minitrack net.

Our preliminary estimates are that these suggestions, if implemented soon, could reduce our balance of payments deficit by $1.2 million in FY 1964 and almost twice that amount annually in future years. I understand that some of these actions are already under consideration within NASA for program reasons, but that others would involve totally new studies. However, my hope is that these suggestions, plus whatever [Page 877] additional suggestions you may have, can be acted upon by October 1, 1963.


Kermit Gordon2
  1. Source: National Archives and Records Administration, RG 59, Management Staff Files: Lot 69 D 434, Interagency Liaison Files, 1962–1968, NASA. No classification marking.
  2. Printed from a copy that indicates Gordon signed the original.