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Our requirement for LH is solid. My decision on the LH program in August 1990 vas based on a comprehensive review of all pertinent alternative aviation rotorcraft. A great deal of effort was spent conducting in-depth analyses and developing significant tradeoffs to support the review. The alternatives analyses clearly showed, and I am convinced, that the Army must replace the aging Vietnam era fleet of rotorcraft now used in support of the light divisions. In the FY91 budget language, the Defense Committees stated that LH is the most cost effective program to replace the Army's aging light helicopter fleet.

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CM Dickinson: If the long-term vision of strategic modernization reflected by your budget comes to pass i.e., the B-2, Midgetman, strategic defenses then the US will have a robust strategic force decades into the next century. Unfortunately, I don't believe anyone in this room would bet their life savings on the political survivability of these costly and controversial systems. Therefore, I am concerned that the Department has opted to terminate a number of short-term politically viable, strategic modernization programs in order to free-up funding necessary to squeeze SDI, B-2, and Midgetman into the 6-year plan. For example, you've decided not to retrofit the first 8 Tridents with the D-5 missile; Rail Garrison will be shelved, and the kinetic energy ASAT program would not be in this budget at all had it not been for White House intervention at the "11th hour". I am particularly concerned, however, with your decision to terminate production of MX test missiles:

In light of continued Soviet strategic modernization, including production of SS-18, SS-24, and SS-25, how can you justify shutting down the only open US ICBM production line?

Answer:

The MX missile procurement was reduced from 173 to 114 missiles when CINCSAC reduced the annual test rate from seven per year to three per year. The reasons for the reduction in the test rate are threefold: (1) Engineering estimates of our ICBM's capabilities have historically been proven to be very accurate as demonstrated by the results of our flight test programs, (2) the results of initial testing of MX from both an accuracy and reliability perspective have been outstanding and (3) the fiscal realities of the 1990s prohibit a classical statistical flight test program. Based on these reasons and testing three missiles per year through the design life (15 years) requires a program buy of 114 assets: we have met this milestone in FY 91 and therefore will cease production.

In the 30 years since the United States has been producing ICBMs, have we ever been through a period with no ICBM production?

Answer:

Yes, there was a seven year (1977-1983) gap in ICBM production (3020 funding) however, when the last Minuteman IIIs were delivered in 1979 we were already producing Peacekeeper missiles with research and development funds.

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- If we produce no more MX test missiles, when will you run out to test assets under current flight testing plans and what becomes of the deployed force without an on-going test program?

Answer: Under the current schedule of three test launches per year we will run out to test assets in 2004. After 2004, ground testing will be used to verify certain functions and reliability of the weapon system. The ground testing will not provide sufficient data to fully estimate weapon system reliability. The CINCSAC will have to decide, based on historical flight test data, whether or not he can accept the increase uncertainty due to a lack of testing. If he cannot, he will have to use operational assets for test purposes thereby drawing down the size of the operational fleet.

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- Could you provide for the record the Department's best estimate of what it would cost to reopen the MX production line (if it could even be reopened) in 5 years? in 10 years?

Answer:

The Department's best estimate to reopen the MX production line after five years would be $580M plus inflation. Costs include restart of the production lines, requalification of contractors/ subcontractors/vendors, and redesign of parts as necessary. Co9sts per major components are as follow: Guidance system - $300M; Stages $250M; Reentry systems - $30M. The cost to reopen the MX production line in 10 years would involve the same requalification costs with the additive being the additional five years of inflation.

KINETIC ENERGY ANTISATELLITE (ASAT) PROGRAM

Representative Dickinson: I understand that in your internal budgeting exercises OSD readily accepted the Army's proposal to terminate the kinetic energy ASAT program that it had formerly fought so hard to protect. I also understand that it is only at the insistence of the White House that the program was actually funded in FY92.

Has there been any change in the threat and, consequently, in the JCS requirement for ASAT, that would justify terminating the program so abruptly?

Has the kinetic energy. ASAT program been funded throughout the six year plan?

Answer: In light of the changing threat and the severe fiscal constraints the department is facing, it is prudent to pursue the ASAT program at a less rapid pace than planned originally. Consequently, we are proposing in the President's FY92 Budget an ASAT program funded at approximately $70 million per year through FY97. This will delay initial operational capability four years relative to the date envisioned in the FY91 budget. The restructured program, however, contains substantially less technical risk than the original version.

DEPARTMENT OF ARMY BUDGET FISCAL YEARS 1992-1993

HOUSE OF REPRESENTATIVES,

COMMITTEE ON ARMED SERVICES,

Washington, DC, Wednesday, February 20, 1991.

The committee met, pursuant to notice, at 10:18 a.m., in room 2118, Rayburn House Office Building, Hon. Les Aspin (chairman of the committee) presiding.

STATEMENT OF HON. LES ASPIN, A REPRESENTATIVE FROM WISCONSIN, CHAIRMAN, HOUSE ARMED SERVICES COMMITTEE The CHAIRMAN. The meeting will come to order. The Armed Services Committee is pleased to have here as witnesses this morning Mr. Michael Stone, the Secretary of the Army; and Gen. Carl Vuono, the Army Chief of Staff. We look forward to their testimony on the Army's fiscal year 1992 budget request.

The country is now at the confluence of two historic events. First, war in the Middle East. Second, chaos in the Soviet Union. Our task is to understand how they affect our defense requirements.

Last year, we took a modest step toward reducing our force structure thanks to a declining Soviet threat and domestic budget pressures. At that time, Congress and the administration generally agreed to move toward a 25 percent build-down by fiscal 1995.

We hope to explore today with Mr. Stone and General Vuono two things. The first is how the Army's 1992 budget request is consistent with this goal and moves toward this goal. We will inquire into changes in force structure and force mix, draw down of active and reserve forces, and the pace of modernization.

The second issue that we want to explore is early lessons learned from Operation Desert Storm. It is clearly too soon to draw very many final conclusions, but it is time to begin asking questions with an eye toward the future.

Before I recognize the witnesses for their opening statements, let me call on Bill Dickinson.

STATEMENT OF HON. WILLIAM L. DICKINSON, A REPRESENTATIVE FROM ALABAMA, RANKING MINORITY MEMBER, HOUSE ARMED SERVICES COMMITTEE

Mr. DICKINSON. Thank you, Mr. Chairman.

Mr. Secretary and Chief, it is a pleasure to have you both back before us this morning, as we begin debate on the Army's fiscal year 1992 budget request.

Mr. Secretary, I think that I just missed having dinner with you in Panama recently.

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General Vuono, when you and the Secretary appeared before our committee almost 2 weeks ago, the accolades were many for the job that the two of you have done and are doing, and the gratitude was heartfelt for the service that you are rendering the country.

Let me first say that the same accolades and the same gratitude apply to the two of you, as it did to all of our service people. I would be remiss if I did not punctuate our thanks to General Vuono with an added measure of praise for the magnificent job that he has done during his 4-year stint as Chief.

As you so eloquently put in your statement, Mr. Secretary, in addition to his having been a tireless and dedicated warrior, he has been a leader whose vision for the Army of the 1990s has set a course that will shape the Army for years to come.

So Chief, as you make your final appearance before the committee, I echo the Secretary's tribute to you, and add my personal thanks for a job well done. The six fundamental imperatives that you have set down to guide the Army are a legacy that will continue to set the standard for many years to come, and we are seeing it bear fruits in the Persian Gulf today.

Last year, everyone was hailing the onset of a new world order and queuing up to offer ideas on how to spend the peace dividend. But when the winds of change have shifted, and they did on August 2nd, we find ourselves at war. That we will win is a certainty. That we will get back on the course of down-sizing the armed forces is almost a certainly.

However, Saddam Hussein has taught us that there are many perils lurking around the globe, and that we therefore need to exercise extreme caution not to do irreparable harm as we go forward with our down-sizing of our military.

As we reduce our numbers, we have to do so with an eye to the future and with the certain knowledge that we will need them again in some undefined way and in some undesignated time.

With this thought in our minds as we begin our questioning, I want to thank you again for your dedication and leadership. The confidence that each of you inspires exhibits that you know how to meet the challenges that lie ahead in maintaining an Army that today is the best in our Nation's history.

I must know offer an explanation and an apology. I have to leave. I am on another committee that is being organized now. I need to go over and look after my interests, which in turn are the House Armed Services' interests, since that is the committee that sets the budget for this committee. I will ask to be excused.

But I was very pleased, if I might digress just a minute, to read the article in this morning's paper having to do with the Apache. That automatically brings to mind the importance and the necessity of the LH program which I know you will address this morning. So thank you both for your presence, and we will look forward to your statements.

Thank you, Mr. Chairman.

The CHAIRMAN. Thank you, Bill. By all means, do not miss that other meeting.

Let me just echo what Bill Dickinson said about Carl Vuono. Dave McCurdy wanted to say something too, but he has to go to a meeting of the Intelligence Committee. All of us appreciate your

work. This is not your last appearance before the committee, but probably your last appearance in support of a Defense authorization request.

We salute you, and appreciate all the work that you have done. We look forward to keeping counsel with you and getting good advice from you wherever you are.

Mr. Secretary, the floor is yours.

STATEMENT OF HON. MICHAEL P.W. STONE, SECRETARY OF THE ARMY

Mr. STONE. Thank you, Mr. Chairman. Mr. Dickinson. As he is leaving, I want to thank him for his opening remarks.

Mr. Chairman, before I make a few opening remarks, I would like to have the Committee's consent to submit a prepared statement for the record.

The CHAIRMAN. Without objection, for both witnesses.

Mr. STONE. Thank you.

This is the second appearance that I have made as Secretary of the Army before the full committee to review the Army's annual budget submission. My appearance, of course, comes in an eventful time for the Army, for the United States, and for the world, as we approach a climatic phase of Operation Desert Storm.

What I want to say in my appearance today has to be cast against the background of several noteworthy factors that I must review with you before our hearing commences.

First, we are all mindful of what General Powell in his statement 2 weeks ago before this Committee characterized as the emerging and the enduring realities of the world. I will not recapitulate his points except to reiterate that the Army too recognizes first the sweeping changes that have taken place in the world, one of the emerging factors that the Chairman mentioned. Second, the emerging reality that our defense budget and the resources available to us will continue to decline for the foreseeable future.

However, those emerging realities have to be viewed from the perspective that the Army has for the first 5 months of this fiscal year been involved in reconciling the paradox that exists between those realities and today's reality, which is the predominant need for the Army to do its share in achieving the success of United States policies in the Middle East. That paradox has involved our adding force structure to the Army and not continuing to reduce it, as the emerging realities will eventually require us to do.

We have not been able to adhere to our schedule of beginning to make both unit and infrastructure reductions in Germany on the scale that we wished. We have had to surge the procurement of goods and services. These factors comprise the paradox that we encounter as we try to reconcile today's world with the Chairman's emerging realities.

What the Army has been able to accomplish in the last 6 months, as we have lived this paradox, is extraordinary. Each of the armed services has a logistics record of which the United States can be proud. But as an example of the Army's extraordinary efforts, I want to mention briefly one phase of the Army's logistics operations.

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