SOVIET MILITARY SPENDING DATA MAY BE INFLATED

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00552R000505230010-7
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: August 26, 2010
• Sequence Number: 10
• Publication Date: September 20, 1983
• Content Type: OPEN SOURCE

Sanitized Copy Approved for Release 2010/08/26: CIA-RDP90-00552R000505230010-7
WASHINGTON
UNITED PRESS INTERNATIONAL
20 September 1983...
SOVIET MILITARY SPENDING DATA MAY BE INFLATED
BY PATRICIA KOZA L
Questionable methods of analysis by Pentagon intelligence experts may be
producing inflated estimates of Soviet spending on the Superpower arms race, a
congressional panel indicated Tuesday.
Sen. William Proxmire, D-Wis., released a study by the joint Economic
Committee that analyzed the differences between recent estimates made by the
CIA and the Pentagon's Defense Intelligence Agency.
The CIA Study found that Soviet defense costs grew at an annual rate of 2
percent during 1978-81, compared to a growth rate of 4 percent to 5 percent
during the previous 10 years.
The DIA study agreed with the Central Intelligence Agency's dollar cost
estimates, but its own current ruble-price analytical process - which does not
take inflation into account -- indicated no slowdown in total Soviet defense
spending.
The DIA found that Soviet actual defense spending increased by 6 percent to 7
percent in real terms, after inflation, during the 1970s and defense procurement
growth slowed somewhat, from 9-11 percent in the first half of the decade to 6-9
percent in the second half.
The Pentagon agency also concluded the share of the Soviet economy devoted to
the military increased from 13 percent to 14 percent in 1970 to 14 percent to 14
percent in 1981. The CIA concluded it did not change during the decade.
Proxmire said the Pentagon agency in effect challenges the CIA estimates
but in doing so, is raising more questions than it answers.
''The tact that the DIA's estimates are not adjusted for inflation reduces
their usefulness to practically zero, ' ' Proxmire said. "This questionable
practice could result in inflating the costs of Soviet defense.
At the very least, the DIA's methodology should be subjected to careful
scrutiny by an outside group of experts so that Congress understands what weight
to give it.".
The study noted the CIA rates the margin of error on its dollar cost
estimates as plus or minus 10 percent. A DIA spokesman estimated the margin of
error in the indirect method for measuring Soviet military procurement was plus
or minus 33 percent.
The report also noted that the CIA's methodology was subjected to "an
exhaustive review'' by an outside panel.
''The latest CIA estimates are significant because they demonstrate a
change in the trend of Soviet defense growth over a five-year period,'' the
study said. ' 'The period is longer than previous cyclical fluctuations and could
represent a medium- or longer-term phenomenom.'
Sanitized Copy Approved for Release 2010/08/26: CIA-RDP90-00552R000505230010-7
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