195. Draft Memorandum From Secretary of Defense McNamara to President Johnson 1
- Defense Department Budget for FY 69 (U)
My review of the Department of Defense military program and financial budget for the next fiscal year has proceeded to the point where I can present certain conclusions to you. Preliminary estimates indicate that the military forces (Tab A)2 and procurement programs which I recommend for your approval will require new obligational authority for Military Functions, Military Assistance, and Civil Defense of $79–82 billion for FY 69. These amounts and previous budgets and appropriations are summarized in the following table:
|New Obligational Authority ($ Billions)c|
|FY 1967||FY 1968||FY 1969a|
|DOD Normal Budget||$50.3||$50.1||$54–57|
|Total NOA Required||$72.7||$73.4||$79–82|
This will result in the following estimated expenditures and share of Gross National Product:
a Based on December 1, 1967, estimates. Subject to further revision.
b Based on a GNP of $862 billion in FY 69.
c Includes $.8 billion in FY 68 and $1.2 billion in FY 69 for the FY 68 pay raises.
The FY 69 Budget was prepared on the basis of two key assumptions:
- Provision was made for deployments to Southeast Asia, comprising 525,000 men in South Vietnam and 46,700 in Thailand, 3,608 [Page 623]helicopters, 1,572 fixed-wing non-attack aircraft, 1,074 attack aircraft, and 707 ships and boats by June 30, 1969.
- Provision was made for combat consumption for all items through FY 69 reorder lead time, enabling continuation of the war indefinitely at the currently planned activity levels, barring unforeseen contingencies, without an FY 69 Supplemental.
The Military Forces supported by this budget are summarized in the tables available for your review. Although I have reduced the budgets proposed by the Services for FY 69 by approximately $16–19 billion, my recommended force structure is based on requirements for national security and has not been limited by arbitrary or predetermined budget ceilings. In my review of the Service proposals, I attempted, as last year, to eliminate all non-essential, marginal, and postponable programs with the objective of minimizing the costs of supporting the required forces.
In developing the program and reviewing the budget proposals, I have had the continuing counsel and assistance of the Joint Chiefs of Staff.3 The points of difference between my recommendations and those of the Joint Chiefs of Staff are set forth in the attachment at Tab B.4 It should not be necessary for you to study the attachment in detail—of the differences with the Chiefs, I believe they will wish to discuss with you only three issues affecting the FY 69 budget.
- Advanced Strategic Bomber (AMSA): The Joint Chiefs of Staff recommend Contract Definition and, subject to favorable review, beginning full-scale development of a new strategic bomber in FY 69, at an FY 69 cost of $40 million. Their plan would aim at an Initial Operational Capability in FY 76. Mr. Nitze and I recommend continuing development of advanced aircraft technology and bomber penetration aids, at an FY 69 cost of $25 million. We recommend against beginning full-scale development of a new bomber in FY 69 because we do not believe an Initial Operational Capability in FY 76 is needed. Development, deployment, and five years of operation of a force of 150 AMSAs would cost about $7.3 billion.
- Modernization of the Fourth (Reserve) Marine Air Wing: The Joint Chiefs of Staff recommend buying 15 A–6As and 8 RF–4Js at a cost of about $92 million in FY 69 to provide more modern aircraft for Marine Air Wings. This would free A–6As and RF–4Bs for assignment to the [Page 624]reserves. This is in addition to the 358 Navy/Marine Corps Fighter, Attack, and Reconnaissance aircraft I recommend buying in FY 69 at a cost of $1,485 million. For FY 69, they also recommend procurement of 25 CH–46 helicopters for the reserves at a cost of about $50 million, in addition to 130 helicopters I recommend buying for the Marines in FY 69 at a cost of about $180 million. (Procurement of all new aircraft for the Fourth Marine Air Wing would add about $1 billion to my recommended plan over the next five years.) Mr. Nitze and I recommend against this procurement because, without it, we are greatly increasing the total tactical airpower and helicopter lift capability of all of our forces, including the Marine Corps, and because we believe the total inventory of Marine aircraft is adequate. Moreover, our general policy is not to buy new aircraft for reserve air forces. Under our recommended plan, from 1961 to 1971, the destruction capability of the Marine fighter and attack forces will increase more than fourfold and the helicopter troop lift capability will increase more than tenfold.
- Development of New Tactical Fighter (F–X/VFAX): Both the Air Force and the Navy want to develop a new fighter to replace the F–4. They believe it is needed to counter the latest Soviet fighters. They recommend that we plan to proceed with “Contract Definition” in FY 69 leading to an Initial Operational Capability in 1975. The FY 69 cost of their latest proposal is estimated at about $104 million. Mr. Nitze and I agree that a new fighter ought to be developed for the mid to late 1970’s, and we recommend including $60 million in the FY 69 R&D budget for this purpose. This will permit an IOC in 1976.
Dr. Foster, the Director of Research and Engineering, has informed me that a properly defined and substantiated joint-Service plan for F–X/VFAX has not yet been developed. Several important issues have not yet been resolved including the extent to which the two Service versions can be common, the size of the crew, and the extent to which all-weather air-to-ground electronics should be included. The recommended $60 million will support an extensive experimental effort in avionics and propulsion to help resolve these issues and to reduce program risks, permitting start of full-scale development in FY 70.
In addition although the JCS do not recommend FY 69 budget action on a Soviet-oriented ABM system, they want to repeat their view that ultimately the U.S. should deploy such an ABM system to protect U.S. population centers against heavy Soviet attacks.5[Page 625]
The recommended program has been discussed with the Director of the Bureau of the Budget, and the President’s Special Assistant for Science and Technology. They are in agreement with my recommendations with two exceptions. Dr. Hornig is concerned about the apparent decrease in the level of R&D on tactical weapons, and what he considers an inadequate rate of application of new technology to Vietnam. However, he will not be in a position to make specific counterproposals until our R&D budget estimates are more firm. Mr. Schultze believes the FY 69 RDT&E total obligational authority should not exceed $7.45 billion. Our tentative proposal for FY 69 is $7.4–7.7 billion.
- Source: Washington National Records Center, OSD Files: FRC 330 71 A 3470, Final Memo to the President 1 Dec 1967, Notes of Meeting with JCS 11/17 & 11/24, Folder 157. Top Secret.↩
- Not printed.↩
- Secretary McNamara met with the Joint Chiefs of Staff on November 17 and 24 to discuss this draft memorandum to the President. Although no formal record of these meetings has been found, McNamara’s detailed (and often illegible) handwritten notes on both meetings are in the Washington National Records Center, McNamara Files: FRC 330 71 A 3470, Final Memo to the President 1 Dec 1967, Notes of Meeting with JCS 11/17 & 11/24, Folder 157.↩
- Not printed.↩
- In a November 27 memorandum to Secretary McNamara, General Wheeler wrote in part: “The issue of the level of Nike-X deployment does not bear directly on the FY 1969 budget; however, it is of sufficient significance to the Joint Chiefs of Staff to warrant discussion with the President.” (Washington National Records Center, McNamara Files: FRC 330 71 A 3470, Final Memo to the President 1 Dec 1967, Notes of Meeting with JCS 11/17 & 11/24, Folder 157)↩
- McNamara initialed at the bottom of the first page.↩
- All aircraft force level recommendations in items 3 through 8 are on a Unit Equipment (UE) basis. [Footnote in the source text.]↩
- All aircraft force level recommendations in items 1 through 4 are on a Unit Equipment (UE) basis. [Footnote in the source text.]↩