AND MATERIAL SUPPORT OF THE ARMED FORCES
p The military budget approved by Congress and endorsed by the President becomes law. Its execution implies the maintenance of the armed forces and keeping them supplied with goods and services necessary for their normal functioning. Military budget execution is closely bound up with logistics support which supplies the link between the economy and the armed forces.
95p As the material requirements of the armed forces grow, so does the importance of the logistics support management and the machinery of budget execution. These problems have an increasing bearing on the effectiveness of military work.
p To keep the armed forces going many different types of outlay have to be made, which vary in form, time and order of priority with the specifics of military work. For instance, spending on military personnel differs from that on arms procurement, the latter, from spending on military research and development, and so on.
p About two-fifths of the total Defence Department spending is the pay to military and civilian personnel of the armed forces. The remaining three-fifths is spent on goods and services provided by private business. The execution of this part of the military budget, i.e., procurement of weapons and ammunition, food and equipment, spending on R&D and other goods and services is crucial for the functioning and combat efficiency of the armed forces. The system of spending for these purposes has a marked impact on the efficiency of military activity. This being so, let us examine in more detail military budget fulfilment as regards the material support of the US armed forces.
p They consume an enormous variety of goods which can be divided into the following basic groups: weapons and military equipment; stores and food supplies; fuel and lubricants, and other goods. The bulk of military purchases consists of weapons and military equipment.
p In the pre-monopoly period of capitalism, the relatively small demand of the armed forces for military equipment was met primarily by specialised government arsenals. Already in the First World War and particularly the Second World War, however, the bulk of armaments was manufactured by private companies. The role of government arsenals in meeting the steadily growing military demand continued to decline after World War II as well. Today, over 90 per cent of the total output of weapons and military equipment is produced by private firms which sell them to the government. Since military demand is vast and varied goods procurement and the management of relations between government procurement agencies and private firms have become a complicated business.
96p Before World War II, military procurement was not centralised. With few exceptions there was no co-ordination between the procurement programmes of the Army [96•1 and the Navy. The technical services of the Army and the procurement agencies of the Navy operated independently on instructions from their command. This incoordination had an adverse effect on military equipment supplies. The military procurement system was sharply criticised during World War I. When the war ended, however, the volume of procurement sharply declined, and demands for radical changes in the military procurement system became less insistent.
p World War II revived attention to this problem. In its early stage co-ordination of the procurement programmes was entrusted to the Army-Navy Munitions Board headed by top civilian officials of the armed forces (earlier procurement had been directed by the military). Early in 1942, direction of military procurement programmes was handed over to the War Production Board, an independent civilian body. Actually, however, the latter exercised its wide authority very rarely, having delegated it to the Army-Navy Munitions Board and to individual armed services. When the war was over, the War Production Board was abolished, and its responsibility for procurement co-ordination was vested in the Army-Navy Munitions Board.
p The Defence Department set up in 1947 (the Air Force was taken over by an independent military department) began to play an increasingly great role in planning military procurement policy and in co-ordinating individual procurement operations, in standardising specifications, in dividing authority for the procurement of general goods and in organising joint procurement. Special instructions were issued to unify procurement methods. Joint procurement agencies were set up to handle oil products and medical goods supply to all armed services. This slightly improved the procurement system and made it more efficient.
p Budget fulfilment, however, still suffered from serious failures partly attributable to the inaccurate estimates of 97 military demand and the budgeting procedure discussed before.
p Independent budgeting for individual armed services presupposed independent budget fulfilment. So the armed services first competed for a greater share of the appropriations, then, when the budget entered the fulfilment stage, for material resources and the right to develop individual types of military equipment. What is more, there was a good deal of rivalry within each of the armed services. For instance, before World War II, advocates of battleships within the Navy vied with champions of naval aviation and aircraft carriers for the lion’s share of the budget appropriations. In the late fifties a similar conflict flared up between champions of missile-carrying submarines and advocates of aircraft carriers.
p Until recently, each armed service obtained almost all requisite goods and services through its own procurement agencies. Competition between the armed services, their autonomy, the actual lack of co-ordination and other drawbacks in their logistics support led to a good deal of duplication in procurement, causing great budgetary waste. All this created a situation where private corporations, pulling their strings in the Pentagon, turned military contracts into a source of fabulous profits.
p Serious shortcomings in budget execution, in particular in military procurement, have long been discussed in the American press and various legislative and executive bodies. Congress has repeatedly noted these shortcomings and instructed the Defence Department to remedy them.
p To raise the effectiveness of military spending and eliminate waste the US Administration has in recent years taken a series of measures to streamline the fulfilment of the military budget and the material supply of the armed forces in addition to improving the procedure for estimating military demand and for budgeting.
p As mentioned earlier, the adoption of the PPB system served to increase the centralisation of authority at the Pentagon in planning military development and co-ordinating different procurement programmes. However, budget fulfilment, i.e., the actual implementation of military programmes, 98 especially in arms procurement, is still decentralised. Top Pentagon officials have pointed out that military activity covers too many fields, problems and territories to be managed from a common centre.
p In fact, numerous agencies and a vast number of military and civilian officers are engaged in military procurement and supply of the armed forces on behalf of the federal government. Both the Defence Department as a whole and the three military departments have such agencies.
p A study of military procurement reveals two conflicting tendencies. On the one hand, the Pentagon has shown growing determination to centralise procurement, on the other, it has transferred some of its functions to new organisations independent from it. For instance, the AEG and NASA, after their inception, took over corresponding procurement functions from the Defence Department.
p Although many different organisations are engaged in military procurement, the federal government is in the final analysis the sole buyer of military hardware. This lends a specific character to the purchase and sale of military goods on the war market where free competition is absent and prices are not governed by the law of value.
p The government procures military goods under contracts with private firms, interfering in the operation of private business to regulate the military economy. These contracts determine not only the scale of military production but also its trends of development and geography.
p Co-ordination of relationships between the numerous government procurement agencies and private firms (prime military contractors alone total 7,500) is a vast and complex field of activity. The Defence Department handles some fifteen million purchasing actions annually. [98•1 A great number of people are involved in awarding military contracts and in supervising their performance. For instance, in 1958, some 5,500 military and about 10,000 civilian officers were engaged in procurement. [98•2 Needless to say, their numbers have since grown due to the marked increase in military procurement.
99p The effectiveness of military spending is dependent in the final analysis on the efficiency of numerous procurement agencies and personnel handling supplies to the armed forces. Therefore, in recent years, the US Administration has introduced important improvements into the management and structure of the Defence Department’s procurement agencies.
p In 1961, the functions of the assistants to the Defence Secretary for procurement, installations and logistics were handed over to the Office of Installations and Logistics, a new Pentagon agency in charge of procurement, transportation and supplies for the armed forces as a whole. It has wide powers, spending some two-thirds of the Pentagon’s budgetary appropriations for its purposes.
p The Office of Installations and Logistics makes recommendations on policy-making, planning and programming within the Defence Department, works out a procedure and standards for the management of approved plans and programmes, examines programmes submitted by individual military departments, assesses the progress in implementing approved programmes and recommends measures to improve the Defence Department’s work, eliminate duplication and raise the level of military preparedness.
p The Office of Installations and Logistics co-ordinates procurement and supply operations of the military departments and other agencies of the Defence Department and maintains liaison with organisations outside the latter’s control. In addition, it works out and issues instructions to procurement agencies.
p Both centralised procurement agencies and the appropriate bodies of the military departments procure goods under the control of the Office of Installations and Logistics.
The production of nuclear weapons is the responsibility of the Atomic Energy Commission. The Defence Atomic Support Agency set up at the Defence Department co- ordinates Pentagon and AEC work in nuclear weapons development, testing and stockpiling. The Defence Atomic Support Agency is also called upon to render qualified assistance to the Defence Department and the Joint Chiefs of Staff in the conduct of military work and the combat training of the armed services in the use of nuclear weapons.
100 Emacs-File-stamp: "/home/ysverdlov/leninist.biz/en/1974/UME271/20080409/199.tx"p In 1961 the Defence Department set up the Defence Supply Agency to control centralised supply to the armed forces of general goods, including their procurement, storage, distribution and transportation, improve logistics support and eliminate overspending on general goods.
p The Defence Supply Agency does not procure military equipment (which is still the responsibility of agencies of the military departments) being in charge of supplying the armed forces with apparel, accoutrements, food, fuel and lubricants, medical goods, industrial materials and other general goods. The list of goods supplied by the Agency covers 1,600,000 items and continues to expand.
p To centralise and streamline the management of military R&D and procurement, the Defence Department introduced a series of changes in the organisational structure of the armed services’ procurement agencies. Besides, it worked out and adopted a five-year economy programme for 1962-66 to save funds by strict observance of the following principles: to procure only indispensable goods on a minimum outlay and cut operating and administrative costs. Between 1962 and 1966, the Defence Department saved a total of over 14,000 million dollars, in particular, 1,052 million in 1966/67 and 1,042 million in 1967/68, primarily by improving the procedure for evaluating military demand, deleting inessential items from procurement programmes, cutting to a minimum the range of complementary goods, spare parts and accessories, as well as by using surpluses to reduce procurement programmes, eliminating superfluous elements of design and manufacture, standardising and narrowing the range of supply items.
p By improving the system of distribution of and settlements under military contracts and tightening up control over their performance, the Defence Department seeks to enhance the responsibility and efficiency oif military contractors and ultimately secure price reductions.
p The Pentagon attaches great importance to cutting operating costs. The rapid progress of military technology leads to early obsolescence not only of weapons systems but often of installations and facilities designed for the use and maintenance of weapons and equipment. Thus, the recent switch from manned bombers to strategic missiles has compelled 101 the Defence Department to revise the entire network of military installations with a view to dismantling redundant military bases and facilities. The Defence Department intends to secure considerable savings by perfecting the operation of its administrative machinery and numerous procurement agencies.
p These savings involve no reduction in Congress-approved military expenditure, which would have simply been greater (or the volume of military work, smaller) by a corresponding amount. The American press noted the token nature of these savings and the Pentagon’s efforts to exaggerate their importance. They, however, have been big enough to raise the effectiveness of US military expenditures on the whole. While amending the PPB system, the Nixon Administration is modifying the methods of military budget fulfilment and military procurement, contracts awarding in particular.
The measures taken by the US Administration to streamline the management of military development are dictated by the overall strategic objectives*of American imperialism. The overall interests of the US monopolies, however, often conflict with those of the military-industrial complex, which has grown and is waxing fat on huge government contracts. It is a sinister force which exerts appreciable influence on the shaping of US foreign policy and manoeuvres the Defence Department into taking decisions which eventually bring the arms manufacturers still greater profits. In its chase after profits it stops at nothing to make the arms race more intensive.