Office of the Historian

75. Report Prepared by the President’s Deputy Special Assistant for National Security Affairs (Bator) and Edward Hamilton of the National Security Council Staff1

Washington, May 23, 1966.

Organizational and Policy Initiatives—European and Economic Affairs

European IRG

On the whole, the IRG for Europe is not a smashing success, but it has had its uses. The lessons of experience thus far are as follows:

1.
The IRG is not much use in crises (either short or protracted), or with respect to the broadest European issues. These matters simply must be handled (a) by a very small group of very senior people, and (b) in a smaller forum—without AID, USIA, CIA, and non-OSD/DOD.
2.
On smaller, more specialized issues—e.g., the proposed NATO Defense Payments Union—the IRG can be useful as a forum for discussion and for needling the bureaucracy into movement.
3.
With John Leddy flat on his back, and NATO/France occupying topside attention, the IRG hasn’t really had a fair test.

[Omitted here are brief discussions of the Planning Group, Formalization of Bureau External Contacts, AID, and Presidential Initiative—Canada.]

Budget—State Programming Experiment

This is a two-front proceeding:

1.

Theory. We are now reaching the latter stages of a long controversy between BOB and Dick Barrett concerning the proper conceptual basis of a foreign affairs programming system. The attached BOB paper summarizes the questions at issue.2 The hardest-fought question, aside from the practical problems of measuring output in foreign affairs, is how to deal with the fact that the foreign affairs establishment consists of several semi-autonomous agencies. Barrett proposes a system which would be appropriate to a single Department of Foreign Affairs, with the Assistant Secretaries of State responsible for all decision-making on [Page 165] objectives and resource allocations. The Budget Bureau argues that the existence of other agencies is a fact that we must live with for the foreseeable future and that the system should recognize it by making them responsible for initial planning and decisions, to be reviewed by State.

To deal with these issues, Crockett and the BOB are proposing establishment of an Advisory Group to meet during the Summer and make recommendations to the Secretary in the Fall. The Group would be asked to develop a system which could be installed for the 1969 budget cycle. Present candidates for membership are as follows: Charlie Hitch (Chairman), Dave Bell, Henry Rowen, Alain Enthoven, Livingston Merchant, Ellsworth Bunker, Stewart Blake, Frederick Mosher, Rensis Likert, and Chris Argyris. They would be backstopped by a contract with Stanford Research Institute which would supply whatever technical help and staff support is necessary.

2.
Practice. While the planning of an overall system proceeds, each agency (State, USIA, AID, Peace Corps) has, at BOB direction, tried pilot programming in a few key countries employing PPBS principles. Basically, this involves reassessments of programs with special emphasis on alternatives to present approaches. In general, the BOB conclusion (which we share) is that the methodology has not really taken hold. There are exceptions, but for the most part the products are distressingly similar to past budget justifications. (Surprisingly, the most notable exception is the Peace Corps, where it appears that a fairly rigorous re-thinking is taking place.) We have been and will continue to be involved in critiques, but our general conclusion is that real progress will probably await a new general system which will force the field posts to take the new mode of thinking seriously.

  • EH
  • FMB
  1. Source: Johnson Library, National Security File, Agency File, State Department, IRG. Confidential. For background to the report, see Document 74.↩
  2. Attached but not printed. The Advisory Group on Foreign Affairs Planning, Programming, and Budgeting, known as the Hitch Committee, addressed these questions in its report to Secretary Rusk; see the attachment to Document 99.↩