148. Memorandum From Secretary of Defense Schlesinger to the Director of Central Intelligence (Colby)1

SUBJECT

  • Comparing the Size of U.S. and Soviet Defense Efforts

I am increasingly concerned about present trends in the relative military positions of the U.S. and the USSR. It seems clear that the USSR is steadily adding to its overall military capabilities, while budgetary constraints are forcing us to cut back, delay and stretch out our modernization programs. I am convinced that these trends cannot continue very long before the U.S. may be widely perceived as risking its present position of leadership in the world.

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A few days ago Andy Marshall and I met2 with George Carver, Robert Slighton and CIA officers to discuss how military economic reporting on the USSR can best be responsive to these concerns. I believe that appropriate comparison of U.S. defense spending with the estimated dollar costs of the Soviet defense program can be part of an effective effort to convey an understanding of the relative sizes of U.S. and Soviet forces and programs. There are, however, some important comparability problems that are not adequately reflected in current available studies. These were discussed at the meeting. They include questions of comparability of U.S. and Soviet programs in the areas of training, health, reserves, intelligence, and other areas.

There are deeper problems in these comparisons. It is often assumed that if the total U.S. defense budget and the total dollar costs of Soviet programs are roughly equal in a given year, then both countries are making equal contributions to military capabilities. This is not necessarily so. A fairly large chunk of the U.S. defense budget is used to support activities which make only a limited and indirect contribution to our military capabilities. Military pensions, educational programs and medical programs are good examples. The U.S. investment in these is a heavy one, the Soviet effort devoted to them is much smaller, so that a larger share of total Soviet spending contributes directly to military capabilities.

An effort should be made to further improve the comparability of overall size of the U.S. and Soviet defense programs. However, whatever improvements are made in comparability of the dollar estimates of the U.S. and Soviet defense efforts problems will remain. I believe that it would be useful to have available two additional kinds of comparative analysis:

—Measures of the physical size of the U.S. and Soviet efforts. For example: comparisons of the manpower involved, service personnel, direct civilian employment, and defense industry employment; broad set of yearly production rates for major items of equipment; comprehensive physical index of military production.

—Building block studies of major functional or program areas. For example, procurement, reserve forces, training, O&M, etc. In each of these the differences in the programs of the U.S. and Soviets should be described, a cost estimate prepared, and all the comparability problems discussed.

In all cases presentation of comparative trends would be essential.

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The above I trust describes my concerns and shows the importance that I attach to this matter. I suggest that your people discuss further details with Andy Marshall, and that they develop a broad set of comparative measures of the size of U.S. and Soviet military programs. I assure you of the cooperation of the Defense Department in providing appropriate U.S. data.3

James R. Schlesinger
  1. Source: Washington National Records Center, RG 330, OSD Files: FRC 330–78–0011, 320.2, Strategic (Sep.–Dec. 1974). Confidential. Marshall forwarded a draft of the memorandum for Schlesinger's signature to Wickham under a covering memorandum, October 30. (Ibid.)
  2. No record of the meeting was found. Schlesinger also discussed the problems involved in estimating Soviet defense expenditures with Proctor and other members of the intelligence community on January 3. The January 13 record of that meeting is in the Central Intelligence Agency, Office of the Director of Central Intelligence, Job 80M01048A: Subject Files, Box 8, Soviet.
  3. In a December 2 letter to Schlesinger, Colby responded that the CIA was currently at work on several studies comparing U.S. and Soviet defense expenditures. The agency was also considering “[w]holly new approaches aimed specifically at your concern about incomparabilities,” wrote Colby, who accepted Schlesinger's “offer of help from the Department of Defense in our attempt to break new ground.” Wickham's handwritten memorandum to Marshall, December 17, was found attached to Colby's letter. Wickham wrote: “JRS Schlesinger views the CIA memo [sic] with some disdain. Their methodology is part of the problem.” (Washington National Records Center, RG 330, OSD Files: FRC 330–78–0011, 320.2, Strategic (Sep.–Dec. 1974))