MILITARY ECONOMICS PANEL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80B01495R000900050022-7
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 6
• Document Creation Date: December 19, 2016
• Document Release Date: October 21, 2005
• Sequence Number: 22
• Publication Date: May 17, 1972
• Content Type: MF

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MEMORANDUM FOR: Deputy Director for Intelligence
SUBJECT Military Economics Panel
1. In response to your request for one or more
sets of qualifications for members of the Director's
Military Economics Panel, we have compiled the follow-
ing list. We do not feel that any prospective panel
member should necessarily fit exactly any of these
sample profiles or that there be more than one repre-
sentative from each of the broad categories indicated.
We do believe, however, that the skills and experience
suggested by the profiles are important to an advisory
group of this type.
--A prominent academician from the field
of Soviet economics. It would not be necessary
that this representative be particularly famil-
iar with military-economics. We do consider it
important that he understand the nature of Soviet
economic statistics and be a generally acknowledged
authority in his field. Given the specialized
subjects to be included in the purview of the
Panel, we suggest that someone with these qualifi-
cations serve as chairman.
--An economist or professional systems analyst
who is thoroughly familiar with the costs of pro-
curing and maintaining major US weapon systems.
We believe that Marshall's recommendation on this
point makes good sense. Our current costing
methodology relies heavily on US analogs. More-
over, the recent misgivings expressed by DIA about
our defense spending estimates suggest that impres-
sions--regardless of their accuracy--about the US
experience in buying and operating complex weapon
systems have influenced the thinking of many people
interested in Soviet defense spending.
4 kiay fihi.,
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17 May 1972
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--A current or former defense decision-maker
who, if not actually trained in systems analysis,
has at least some appreciation for quantitative
techniques as an aid to problem solving. Someone
who has been in the position of using military
spending information as one of the considerations
in determining the level of the US defense effort
would presumably be a valuable critic of the
form as well as the substance of CIA military-
economic reports.
3. Other possible Panel members could be:
--An individual with broad experience in
planning, managing, or analyzing large R&D
problems. Soviet RDT&E spending is an especially
difficult area of intelligence research. Any
additional expertise brought to bear on this
problem, even in context of an advisory panel,
could be of value.
--A general Sovietologist.
25X1
Actn Director
Strategic Research
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Proposed Membership
DCI Military Economic A visory Panel
Chairman: A generally acknowledged authority on the Soviet
economy with a deep understanding of Soviet
economic statistics:
Other members: (one from each category)
--Academician--Specialist on the Soviet economy:
--Economist or systems analyst who is familiar
with the costs of procuring and maintaining
major US weapon systems:
25X1
25X1
25X1
--A current or former defense decision-maker with
some appreciation for quantitative techniques for
solving problems; one who has been in a position
of using military spending information as an 25X1
input to decisions on the US defense effort:
--An individual with broad experience in planning,
managing or analyzing large R&D problems:
--A recognized specialist on Soviet affairs:
25X1
25X1
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DCI Military Economic Advisory Panel
Background and Functions
1. For more than 15 years the Directorate of
Intelligence has been producing estimates of Soviet
defense expenditures as part of its responsibilities
for the production of economic intelligence on the
USSR. This activity has provided a service of common
concern to all agencies in the national security
community interested in analyses of Soviet military
forces and programs. Interest in our work in this
area has increased greatly over the past two years
or so, at least in part because of economic develop-
ments in the United States which have focused attention
generally on the expenditure implications of defense
activities. It is clear that the intelligence on
Soviet defense spending provided to the US decision-
maker must be of the highest quality. To this end
an advisory panel of outside experts can help to
insure that the best possible job is being done.
2. Specifically, it would be necessary for the
panel members first to become thoroughly familiar
with the data base and methodologies now being used
in the Directorate of Intelligence. This would re-
quire a fairly substantial initial investment of
time--on the order of one to two weeks--on the part
of the panel members. It would be necessary, for
example, for the panel to gain a solid appreciation
of the intelligence sources and quality of the evi-
dence on all aspects of Soviet military forces and
programs. This would be a first order of business
and could only be achieved by several days of detailed
briefings and study of selected finished intelligence
studies.
3. At the completion of an initial phase of
study and familiarization--within, say six months--
the panel would be expected to advise the Director
of Central Intelligence on three important aspects
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of the military economic analysis now being performed
in the Directorate of Intelligence:
--Evaluation of data sources
--Evaluation of methodologies
--Critique of finished intelligence studies:
do they address the right questions? do they
utilize appropriate cost concepts? do they
adequately measure levels and changes in levels
of weapons development, procurement, and deploy-
ment and the operating activities of the forces?
4. The panel would be a continuing body to be
called upon for assistance as deemed necessary by the
DCI. In particular the panel would be expected to
perform a follow-up review of its initial recommenda-
tions. Annual joint meetings lasting up to several
days would be needed, supplemented by periodic meetings
of CIA personnel with individual panel members, as
required.
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MEMORANDUM FOR: Deput, )irector for
Intelligence
Here are the papers you asked for. I
also am returning our original package.
The draft letters, for example, may still
be of use to you.
The candidates in each category are
listed in the order of our preference.
Enthoven could qualify in more than one
category, but we have a gap in the R&D
area and he has had experience here. We
are also checking with Don Steininger for
possible others.
I am uncertain of classification of the
two papers, but suggest that Administra-
tive: Official Use Only would be appro-
priate and would let you use them flexibl
25 May 1972
(DATE)
FORM 1 AUGN54 IQ I RELACES MUS10-101
ED.
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