Chapter VIII:
The McNamara Revolution
One of the major issues of the
1960 Presidential campaign was the alleged inadequacy of the Eisenhower
administration's direction and management of the nation's security. Two
of the principal critics were retired Army Chief of Staff General
Maxwell D. Taylor and the former Army Chief of Research and Development
Lt. Gen. James M. Gavin. The Subcommittee on National Policy Machinery
of the Senate's Committee on Government Operations, under Senator Henry
M. Jackson of Washington, began a series of hearings and investigations
in January 1960 which also concentrated on the inadequacy of this
country's national security organization. Senator John F. Kennedy, when
running for President, appointed Senator Stuart E. Symington of
Missouri, a former Secretary of the Air Force under President Truman,
chairman of an advisory committee to investigate the organization and
operations of the Department of Defense. Finally two RAND Corporation
officials, Charles J. Hitch and Roland N. McKean, criticized the
financial management of the Department of Defense in The Economics
of Defense in the Nuclear Age.
General Gavin charged that the
roles of the joint Chiefs as heads of separate military services were
incompatible with their functions as the nation's top military planners
because they could not in practice divorce themselves from the
particular interests of their individual services. There were
"interminable delays" in reaching decisions caused by
disagreement and deadlock among the services. He suggested abolishing
the joint Chiefs of Staff and substituting a Senior Military Advisory
Group to the Secretary of Defense. Its members would be senior officers
who had just completed a tour of duty as their service's chief of staff,
and a functional joint staff would support them.1
[299]
General Taylor had become the
principal military spokesman of the Marshall tradition of tight
executive control over the armed services before and after his
retirement as Chief of Staff of the Army. In The Uncertain Trumpet, he,
like General Gavin, was critical of current military strategy because it
neglected the Army in favor of the massive deterrent of the Strategic
Air Command. Concentration on total nuclear war similarly neglected the
requirements of conventional and limited warfare, the principal type of
conflict that had developed during the cold war.
Like General Gavin, Taylor also
criticized the procedures by which the joint Chiefs of Staff reached
their decisions. Repeating General Marshall's dictum, he told the
Jackson Committee that "you cannot fight wars by committee." A
single armed services chief of staff should run the Secretary of
Defense's "command post" for him, assisted by an advisory
council. In summary effective control over operations required more
efficient planning as well as a more efficient planning organization.
The current role of the Defense
Department Comptroller disturbed General Taylor. Given the fact that the
joint Chiefs of Staff were often in deadlocked disagreement, he asserted
that "strategy has become a more or less incidental by-product of
the administrative processes of the defense budget." To avoid this
situation he would restructure defense budgets on the basis of the
strategic missions to be performed rather than on the resources or
functions required to perform them. What was needed was a strategy of
"flexible response" capable of meeting all levels of conflict
from "cold" through "limited" to "total"
war; "atomic" deterrent forces based on intercontinental
missiles rather-than manned bombers; "counterattrition forces"
capable of fighting "brush fire wars;" guerrilla and other
"limited" conflicts; mobile reserve forces, including
mobilization stockpiles; air lift and sea lift forces; antisubmarine
warfare forces; continental air defense based on the development of
antimissile missiles; plus whatever resources were required to support
general mobilization and civil defense programs. The three military
services would be reorganized similarly as operational commands while
the three service departments would be organized to mobilize, train, and
support
[300]
them. In this manner American
military commitments could be balanced effectively with the resources
required to fulfill them, another objective which General Marshall had
posited at the end of World War II.2
Outside the military services a
special Preparedness Investigating Subcommittee of the Senate Armed
Services Committee under the chairmanship of Senator Lyndon B. Johnson,
Democrat of Texas, in 1957 began a continuing series of inquiries into
satellite and missile programs, into the role of the Bureau of the
Budget in formulating and executing defense budgets, and into other
major issues.
Senator Jackson's Subcommittee
on National Policy Machinery investigated "whether our Government
is now properly organized to meet successfully the challenge of the cold
war." 3
Former Secretary of Defense
Robert A. Lovett, a leading civilian disciple of General Marshall, was
the first witness to testify before this committee. Echoing his
predecessor, he said bluntly that the "committee system" under
which the Department of Defense and, indeed, the entire federal
government operated traditionally was the principal obstacle to
effective decision-making. He admitted that the committee system had
developed out of the federal form of government as part of "a
series of checks and balances" to prevent any one group within the
government from becoming too powerful.
The often forgotten fact is that
our form of government, and its machinery, has had built into it a
series of clashes of group needs...This device of inviting argument
between conflicting interests-which we can call the "foulup
factor" in our equation of performance-was obviously the result of
a deliberate decision to give up the doubtful efficiency of a
dictatorship in return for a method of protection of individual freedom,
rights, privileges, and immunities.
Mr. Lovett feared that within
the executive branch alone there was an observable trend to expand the
committee system
[301]
to the point where mere
curiosity on the part of someone or some agency and not a "need to
know" can be used as a ticket of admission to the merry-go-round of
"concurrences." This doctrine, unless carefully and boldly
policed, can become so fertile as spawner of committees as to blanket
the whole executive branch with an embalmed atmosphere . . . . The
derogation of the authority of the individual in government, and the
exaltation of the anonymous mass, has resulted in a noticeable lack of
decisiveness. Committees cannot effectively replace the decision-making
power of the individual who takes the oath of office; nor can committees
provide the essential qualities of leadership.4
Thus did Mr. Lovett compare the
Marshall tradition concept of tight executive control with the
traditional procedures of completed staff actions.
Senator Stuart Symington
represented Air Force critics of the JCS committee system. As chairman
of a task force on defense organization and management appointed by
Senator Kennedy during his 1960 campaign for President, Symington
heavily weighted his committee with Air Force spokesmen. One was Thomas
K. Finletter, the first Secretary of the Air Force. Another was former
Assistant Secretary and later Under Secretary of the Air Force Roswell
L. Gilpatric.
Not surprising, the criticisms
and recommendations made by the Symington Committee reflected policies
advanced by the Air Staff in 1959 in its "Black Book on Defense
Reorganization" favoring "total unification."
Interservice rivalry, the committee said, prevented the JCS from
functioning effectively. To eliminate this rivalry it recommended
abolishing the joint Chiefs of Staff in favor of a single armed forces
Chief of Staff, called the "Chairman of the Joint Staff," who
would be chief military adviser to the Secretary of Defense and the
President and direct the activities of the joint staff. He would also
preside over a Military Advisory Council composed of those senior
officers who had just completed tours of duty as chiefs of staff.
Divorced from their services they would no longer feel required to place
service interests above everything else.
Second, the Symington Committee
proposed to abolish the three "separately administered"
services and reorganize them as "organic units within a single
Department of Defense." The Secretary of Defense would be assisted
by two Under Secretaries, one for Weapons Systems and another for
Administration. The former would be responsible for all logistical
support
[302]
SECRETARY McNAMARA
activities, including research
and development, production, procurement, and military construction and
installations. The latter would be responsible primarily for personnel
and financial management. A series of functional directorates similar to
the existing Assistant Secretaries of Defense would act as the
department's staff.
Finally, to integrate the
services completely the committee recommended adopting uniform
recruitment policies, uniform pay scales, unified direction of all
service schools, and a more flexible policy of transferring personnel
among the services. The military services would retain their individual
chiefs of staff who would have direct access to the Secretary of
Defense. The services would also retain such vestiges of their former
separate identities as their distinctive uniforms.5
Spokesmen for the Army's
Marshall tradition and the Air Force were the major critics of the
Eisenhower defense policies and organization. Representatives of the
Navy, which remained the principal supporter of the JCS committee
system, were conspicuous by their absence. Supporting the critics was
the
[303]
Mr. VANCE
observable trend of the previous
decade in the direction of greater authority and control over the
services by the Secretary of Defense. As one student of the defense
organization put it: "Gradually, and with a finesse which demands
respect, the services are being dismembered and disembowelled, so that
the question of their utility is decided continually in decrements.
Since we cannot reasonably expect to turn the clock back, the only
relevant question is whether the process is too fast or too slow."
6
The trend toward centralized
authority in the Secretary of Defense seemed likely to continue, but
future developments were partly contingent on the man President Kennedy
selected as his Secretary of Defense, Robert S. McNamara. McNamara was a
highly successful industrial manager, a "comptroller" in the
broadest sense of that much-abused and misunderstood term. Most of the
reforms he instituted as Secretary of Defense and the techniques he
employed were ones which management experts since the days of General
Somervell's Control Division had repeatedly recommended. What was unique
was the rapidity with which he absorbed information and made decisions.
What had disturbed him most at the outset was the long time it took to
get decisions out of the Department of
[304]
Mr. HITCH
Defense. In the General Marshall
tradition he placed the blame for delay on the committee system with its
endless bargaining and compromises. He intended to replace committees
where possible by asserting greater executive authority, responsibility,
and control over the department and its operations. As he said,
"The individual in the position of responsibility must make the
decision and take the responsibility for it." 7
Secretary McNamara was surprised
to find that there was no management engineering agency within his
office responsible for reviewing organization and procedures. He
promptly assigned this function to the department's new General Counsel,
Cyrus R. Vance, a veteran of the Johnson Defense Preparedness
Subcommittee. Another Johnson subcommittee veteran, Solis Horwitz,
became Director of the Office of Organizational and Management Planning
under Mr. Vance. This agency was responsible for directing or
supervising studies requested by Secretary McNamara in its assigned area
and for monitoring major organizational changes in the Department of
Defense stemming from such projects.
One study led to regrouping the
functions of the Assistant
[305]
Secretaries of Defense. The two
Assistant Secretaries for Manpower, Personnel, and Reserve and for
Health and Medical services were combined under one Assistant Secretary
for Manpower. The Assistant Secretaries for Supply and Logistics and for
Property and Installations were also combined under one Assistant
Secretary for Installations and Logistics. An Assistant Secretary for
Civil Defense was added because this function had been transferred to
the Defense Department. Other studies resulted in abolition of more than
five hundred superannuated departmental committees and in a major
reorganization of the Air Force's field establishment into a research
and development or Systems Command and a Logistics Command.8
Secretary McNamara's first major
reform was to revise the Defense Department's budget to reflect the
military missions for which it was responsible. The person most directly
responsible for this project was the new Defense Comptroller, Charles J.
Hitch. The Office of the Comptroller in the Army for several years had
advocated such a budget. When McNamara became Secretary of Defense the
Army's Chief of Staff was General George H. Decker, a former
Comptroller, who sought to develop some means of presenting the Army's
costs of operation in mission terms. In the fall of 1960 shortly after
he became Chief of Staff, Decker had initiated additional investigations
of this concept.9
Mr. Hitch believed that the
combination of functional budget categories and the rigid budget
reductions of the Eisenhower administration had created unmanageable
problems, with each service favoring its own projects at the expense of
joint ones, concentrating on new weapons systems at the expense of
conventional ones, and neglecting maintenance.
The Army's own modernization
program emphasized the development of missiles and Army aviation at the
expense of conventional weapons and equipment, Mr. Hitch charged. In
[306]
an era of financial austerity
the Army's major overhead operating costs, the operations and
maintenance program, suffered most. More and more equipment was useless
for lack of spare parts. Deferred maintenance seriously impaired the
Army's combat readiness. Local commanders often had to transfer
operations and maintenance funds intended for repairs and utilities for
more urgent missions, an illegal transaction made possible by the thin
dividing line that existed in practice between procurement activities
and overhead operations.10
Another major weakness of the
existing budget was the failure to relate functional appropriations to
major military missions or objectives. Mr. Hitch proposed a series of
nine "Program Packages" designed to solve this problem. (Table
3)
MAJOR PROGRAMS, TOTAL
OBLIGATIONAL AUTHORITY
(IN BILLIONS OF DOLLARS)
Major
Programs |
FY
1961
Actual 2 |
FY
1962
Original |
FY
1962
Actual |
FY
1963
Estimated |
Strategic
Retaliatory Forces |
|
7.6 |
9.1 |
8.5 |
Continental
Air and Missile Defense Forces |
|
2.2 |
2.1 |
1.9 |
General
Purpose Forces |
|
14.5 |
17.5 |
18.1 |
Airlift/Sealift
Forces |
|
.9 |
12 |
1.4 |
Reserve
and Guard Forces |
|
1.7 |
1.8 |
2.0 |
Research
and Development |
|
3.9 |
4.3 |
5.5 |
General
Support |
|
12.3 |
12.7 |
13.7 |
Civil
Defense |
|
|
.3 |
.2 |
Military
Assistance |
|
1.8 |
1.8 |
1.6 |
Total
Obligational Authority |
46.1 |
44.9 |
51.0 |
52.8 |
-
- 1 Total obligational authority represents
the total financial requirements for the program approved for initiation
in a given fiscal year, regardless of the year in which the funds were authorized
or appropriated.
- 2 Breakdown not available for fiscal
year 1961.
-
- Source: Annual Report of the Department
of Defense, FY 1962, p. 367.
- [307]
- Only three of the new categories
referred to major military missions: strategic retaliatory forces, continental
air and missile defense forces, and general purpose forces for conventional
or limited war. Four categories, air lift and sea lift forces, research
and development, general support, and reserve forces were supporting activities.
Military assistance and civil defense, the latter soon replaced as a separate
category by retired pay, were separate categories for political reasons
as much as anything else because Congress insisted on treating these areas
separately from regular defense appropriations.11
-
- Congress did not accept these program
packages as a substitute for the service-oriented, functional appropriations
structure developed in the previous decade. As a consequence, Mr. Hitch
and the services with the aid of computers developed a means, known as a
torque converter, of translating program packages into appropriations categories
and vice versa, both for the current fiscal year and projected several years
into the future.
-
- Applying appropriations categories
to major military missions or to the research and development of major new
weapons systems was not too difficult. The problem was how to apportion
overhead operating costs like operations and maintenance among the major
missions and similarly to break down the general support package into standard
appropriations.12
-
- Since the major purposes of Mr.
Hitch's reforms were to enable Congress, the President, and the Secretary
of Defense to assert greater control over defense budgets and operations
and to balance military requirements with the resources available to carry
them out, much depended on the accuracy and uni-
- [308]
- formity of the statistical information
contained in budget requests. If inaccurate information were fed into computers,
the answers would be inaccurate. The lack of reliable cost data, particularly
for the Army's operations and maintenance program with which the department
and the Army had been struggling for more than a decade, remained a major
unsolved problem complicated by the continuing shortage of funds available
for this category of appropriations.13
-
- The analysis of resource requirements
and their allocation among competing military programs on a rational basis
was the responsibility of a new Office of Programming within the Department
of Defense Comptroller's Office under Hugh McCullough, a veteran with twenty
years' experience in military financial management including the research
and development of the Navy's Polaris missile system. Within this new office
a Systems Planning Directorate developed means by which to measure and translate
into financial terms the mat6riel, manpower, and other resources required
by the military services, a function currently known as force planning analysis.
-
- The most difficult assignment was
that of the Weapons Systems Analysis Directorate under one of Secretary
McNamara's famous "whiz kids," Dr. Alain C. Enthoven, a young
RAND Corporation alumnus. The failure to relate appropriations to new weapons
systems from their conception to their operational deployment and ultimate
obsolescence was, Hitch asserted, another great weakness of the existing
budget structure. What was needed, and what Dr. Enthoven's office attempted
to supply, was a rational means of estimating the costs of new weapons systems,
including not only the costs of research and development and of procurement
and production but their annual operating costs. Military officers neglected
the latter in their estimates because they were not accountable for these
costs. In evaluating alternative weapons systems and strategies Enthoven
and his staff employed cost-effectiveness analysis developed by economists
and systems analysis developed by operations research analysts. Their evaluation
included analysis of the objectives of competing strategies and
- [309]
- their often unstated underlying
basic assumptions. It sought wherever possible to substitute rational judgment
for guesswork in reaching decisions. As Mr. Hitch said:
-
- In no case . . . is systems analysis
a substitute for sound and experienced military judgment. It is simply a
method to get before the decision-maker the relevant data, organized in
a way most useful to him . . . . What we are seeking to achieve through
systems analysis is to minimize the areas where unsupported judgment must
govern in the decision-making process.14
-
- Cost effectiveness and systems analysis
introduced the jargon of statistics and computer technology into military
planning. When "the standard economic model of efficient allocation"
employed in cost effectiveness studies was defined as "the maximization
of a quasi-concave ordinal function of variables constrained to lie within
a convex region," a communications gap opened between the systems analysts
and those combat veteran officers unfamiliar with the language. Within the
Army it was several years before similar agencies for Force Planning Analysis
(21 February 1966) and Weapons Systems Analysis (20 February 1967) were
established on the Army staff to match the organization in the Department
of Defense Comptroller's Office. By that time the urgent requirements of
the Vietnam War had displaced cost effectiveness in priority within the
Department of Defense.15
-
-
- When McNamara became Secretary of
Defense the centralization of authority in the Office of the Secretary of
Defense was apparent in the number of agencies operating directly under
the Secretary or the joint Chiefs rather than under the
- [310]
- service departments. One of the
earliest of these was the Armed Forces Special Weapons Project (AFSWP),
an ad hoc interdepartmental, triservice organization, set up on 1 January
1947 by joint directive of the Secretaries of the Army and Navy as the successor
to the Manhattan District when the new Atomic Energy Commission took over
most of the latter's functions and facilities. AFSWP was a combined logistical
support, training, and combat developments agency for the military application
of atomic energy. Serving the Army, Navy, and later the Air Force it was
never a joint agency as such. It reported to the Secretaries of War and
Navy and later to the Secretary of Defense through the service chiefs.
-
- Following the Department of Defense
reorganization of 1958, the Armed Forces Special Weapons Project was redesignated
as the Defense Atomic Support Agency (DASA) and placed under the JCS. The
National Security Agency (NSA), created in 1952, continued to perform highly
specialized technical and coordinating functions in the intelligence area
under the direction of the Secretary of Defense. The Advanced Research Projects
Agency (ARPA) was created in February 1958 as a separately organized research
and development agency of the Department of Defense.
-
- The Defense Communications Agency
(DCA) was created on 12 May 1960 as an agency of the Department of Defense
responsible to the Secretary through the JCS for the "operational and
management direction" of the Defense Communications System, including
all Department of Defense "world-wide, long-haul, Government-owned
and leased, point-to-point circuits, terminals, and other facilities,"
to provide secure communications among the President, the Secretary of Defense,
the JCS, and other government agencies, the military services and departments,
the unified and specified commands, and their major subordinate headquarters.
-
- The first joint defense agency Secretary
McNamara established was the Defense Intelligence Agency (DIA), established
under the JCS by a directive on 1 August 1961 to "organize, direct,
and manage the Department's intelligence resources and
- [311]
- to coordinate and supervise such
functions still retained by the three military departments."16
-
- Nearly all these agencies transferred
some functions or activities of the Army, Navy, and Air Force to the Department
of Defense under the JCS. Another function Secretary McNamara wanted to
investigate, common supplies and services, affected the Army more directly.
The issue was whether the existing single manager system provided the most
effective means of integrating these activities. As outlined earlier this
system had been adopted as a means of avoiding complete integration under
a fourth service of supply and against considerable opposition from the
military services. They continued resistance to further integration, disagreeing
on what items should be classified as common supplies and services and on
the development of more uniform supply distribution procedures. Congress
continued to exert strong pressure for further if not complete integration
through a separate defense common supply and service agency.17
-
- On 23 March 1961 Secretary McNamara
asked Mr. Vance and the several Assistant Secretaries for Installations
and Logistics to study this question, which he labeled Project 100. They
were to investigate and list the advantages and disadvantages of (1) continuing
the existing single manager system operating under the several service secretaries,
(2) assigning responsibility for operating a consolidated supply and service
agency under one secretary, or (3) operating such a service under the Secretary
of Defense.18
-
- The Project 100 Committee submitted
its report on 11 July 1961. The principal weaknesses, it thought, of continuing
the existing system of multiple single managers were that the numerous channels
of command and staff layers required de-
- [312]
- layed decisions and impeded effective
control over operations. Any increase in the numbers of single manager assignments
would further complicate this problem, producing duplication and greater
diversity of procedures. Finally the single managers had to compete for
limited manpower and operating funds with other service functions.
-
- The principal disadvantages of consolidating
these functions under one department were that the service selected might
tend to favor its own programs and at the same time interfere in the supply
management of the other two services. It would also call for a major reorganization
with all the attendant confusion, disruption, and temporary loss of efficiency.
Interference in the supply management of the services and the disruptive
effect of a major reorganization were also disadvantages of setting up a
separate consolidated common supply and service agency. It might also be
less responsive to combat support requirements.19
-
- The committee recommended that whatever
organizational pattern was selected common supply and service functions
should remain a military responsibility because their sole purpose was to
support military operating forces. Such an integrated system should also
be adaptable to wartime use immediately. Each service should retain full
control over the development and management of its assigned weapons systems.
All of them would continue to require military personnel trained in supply
and service management. Common supply and services activities should be
restricted to wholesale distribution within CONUS, and the services should
retain their own retail distribution systems and facilities as under the
existing single manager systems.20
-
- The service chiefs and secretaries
split in their choice of alternatives. Secretary McNamara publicly announced
his decision on 31 August 1961 that a separate common supply and service
agency to be known as the Defense Supply Agency (DSA) would be established.
The Department of Defense directive issued on 6 November 1961 establishing
DSA, effective 1 January 1962, differed from the Project 100 Committee's
concept in two important respects. The committee thought
- [313]
- there should be a Defense Supply
Council composed of the Deputy Secretary of Defense, the service secretaries,
the chairman of the joint Chiefs of Staff, and the Assistant Secretary of
Defense for Installations and Logistics. This council would actively supervise
DSA's operations. Secretary McNamara made the council a purely advisory
agency and granted the director broad executive authority to run the Defense
Supply Agency. Second, he did not limit the choice of the director specifically
to a military officer as recommended by the committee. The man he chose,
however, was a former Quartermaster General of the Army, Lt. Gen. Andrew
T. McNamara. Finally, at the request of the JCS which did not want the responsibility
for DSA, Mr. McNamara ordered the director to report directly to him instead
of through the JCS as was the case with nearly all the other joint defense
agencies.21
-
- When the Defense Supply Agency was
set up, it took over the eight commodity single managers, the Military Traffic
Management Agency, the Armed Services Supply Support Center, the thirty-four
Consolidated Surplus Sales offices, the National Surplus Property Bidders
Registration and Information Office, the Army and Marine Corps clothing
factories, and the management of a proposed electronics supply center. DSA
was to administer the Federal Catalog Program, the Defense Standardization
Program, the Defense Utilization Program, the Coordinated Procurement Programs,
and the Surplus Personal Property Disposal Program.
-
- The Defense Supply Agency staff
included both military and civilian personnel from all services on a joint
basis, but 95 percent of its staff were civilians. Originally nearly 60
percent of its staff came from the Army, including most of the Quartermaster's
supply management personnel. By the end of June 1963, DSA was managing over
a million different items in nine supply centers with an estimated inventory
value of about $2.5 billion.
-
- In general DSA was to act as a wholesale
distributor of supplies to the services within the continental United States.
The military services would decide what they wanted, where they wanted it,
and when. DSA would decide how much to buy, how much to stock, and how to
distribute it to meet the
- [314]
- needs of the services. The services
retained responsibility for selecting those items which should be placed under
integrated management.22
- [315]
Endnotes
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