PACKARD AND THE COMPLEX

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00587R000100030035-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: March 8, 2011
• Sequence Number: 35
• Publication Date: November 25, 1985
• Content Type: OPEN SOURCE

Sanitized Copy Approved for Release 2011/03/08: CIA-RDP91-00587R000100030035-2
WALL STREET JOURNAL
ARTICLE APPEARED 25 November 1985
ON PAGE.ddi
RmEW & OUTLOOK
Packard and the Complex
Congressmen, retired generals,
and think tankers who have clamored
for "military reform" are on their
seat edges. A bipartisan panel on Pen-
tagon procurement, headed by ex-de-
fense aide and current Hewlett-Pack-
ard chairman David Packard, will
start issuing suggestions soon. So the
Beltway's would-be Bismarcks are
scrambling to get in a plug for their
own gimmicks, from more "competi-
tion" to less "interservice rivalry" to
"tighter auditing."
We hope the commission will take
a step back from this morass and con-
sider some basics. For example: Half
the major U.S. weapons makers are
now under investigation. If these com-
panies are not guilty, a new scapegoat
will have to be found for the $3,000
coffee makers congressmen wave to
an eager press. On the other hand, if
Congress can force more corporate of-
ficers to follow the head of General
Dynamics up to the guillotine, there
will be a whole industry to rebuild.
So as the members ponder $80
wrenches, or the reasonableness of
kennel bills as an "indirect expense,"
or one senator's concern about radios
used in the successful invasion of Gre-
nada, they might ask whether, if these
are topics of discussion, something
fundamental isn't askew. They might
wonder whether "increased competi-
tion," a "procurement czar" or any
other solution will work-if carried
out by the same Military-Congres-
sional Complex that has audited the
industry to its knees.
Are we suggesting that all these
waste-and-fraud checkers and arms-
control analysts should be swept
away? That the defense establishment
might be able to do without the De-
fense Contract Audit Agency, Defense
Logistics Agency, Arms Control and
Disarmament Agency, Office of Tech-
nology Assessment, and some 30-plus
House and Senate committees that
oversee weapons? Well, yes.
To imagine a system without all
those checks and double-checks is
hard for politicians, and even execu-
tives. All have grown used to regu-
lation and oversight. To talk about re-
moving them is like telling a Soviet
planner you can have an economy
where prices get set, goods allocated
and wages paid, all without a single
order being issued. Scary.
So we've read up on the problem
as it applies to weapons. And we rec-
ommend to Mr. Packard two items.
Item one is the House-Senate re-
port on Public Law 88-288, "to autho-
rize appropriations during fiscal year
1965" for the Armed Forces. The bill
passed on March 20, 1964. It runs
three quarters of one page. By con-
trast, we have a similar House-Senate
report: 519 pages, it was published
Sept. 10, 1985. Nor does it represent
the final work of Congress on the de-
fense bill. House and Senate conferees
bitterly debated this "authorization"
into October, after the actual "appro-
priation" of money should have been
finished.
Item two is a study by Robert A.
Magnan for the Central Intelligence
Agency, reported by Jack Anderson
and obtained by the Journal, compar-
ing U.S. and foreign weapons building.
Mr. Magnan finds that "not a single
foreign country" with a substantial
military builds weapons like we do.
France, for example, recently sur-
passed the U.S. in open-market arms
sales. Yet France "has no real review
of the defense budget," Mr. Magnan
writes. Research budgets are secret.
The Defense Ministry routinely ig-
nores questions from Parliament.
"The biggest single strength of the
French system is the existence of a
professional, independent service ..
that is trusted to manage."
That service employs 25 people.
"You people do the work of tens of
thousands of us bureaucrats in Wash-
ington," said an astonished American
general. "Of course, most of us are
writing memos to each other."
The French also rely on "fixed-
price" contracts. The contractor sets
a price "bid" for a system and the
government accepts or rejects it. If
the contractor delivers the product to
quality specifications, he gets his
price. No one even has to figure out
who should pay what kennel bill. Ana-
FILE ONLY
logous procedures inhere in Germany,
Israel and even the Soviet Union.
We have been giving congressmen
a lot of heat for their role in military
waste. To their credit, some, like Sam
Nunn and Barry Goldwater, have ac-
cepted a share of the blame. Yet it
will not be enough if individual con-
gressmen merely refrain from the ex-
cessive oversight of recent decades,
leaving intact the vast complex that
does most of the damage.
The tragedy, Mr. Magnan notes, is
that "all participants in the U.S. pro-
cess appear to sincerely try to make
the system work better." Yet, "the
more assiduously each participant
performs its function, the slower the
system works and the less stable its
programs." Hence weapons like the
Polaris submarine "seem to succeed
to the extent that they are lifted out of
the formal acquisition system."
If generals and executives in
France and Russia can be trusted,
surely they can be in the U.S. That is
what cutting-edge reformers like Rep.
Jim Courter suggest today. That is
what the Packard Commission should
recommend in months to come.
Sanitized Copy Approved for Release 2011/03/08: CIA-RDP91-00587R000100030035-2