"We plan to eliminate draft calls altogether by July 1973. To reach that goal there are problems which must be resolved.

-- We need to enlist men with the ability to operate and repair the sophisticated weaponry of modern warfare.

We must enhance the attractiveness of service careers while building a disciplined and effective force.

"I am confident that we will solve these problems and that we will be able to end reliance on the draft without sacrificing military readiness.

"Nothing will be more essential to the maintenance of our strength in the remainder of the 1970's than the quality and dedication of the men who choose a military career. In order to attrack men who meet the highest standards, we must strengthen the vitality of the armed forces. This is the responsibility of every service. We must also bolster respect for the military profession in our society. This is the responsibility of every citizen.

In his statement before the Senate Armed Services Committee (28 March 1973) on the FY 1974 Defense Budget and the FY 1974-1978 program, while Secretary of Defense, Mr. Richardson stated:

"There is a compelling need--and with the end of the Vietnam conflict, a new opportunity--to concentrate executive energies on the urgent task of improving the planning and implementation of the Defense program. We must provide a defense management which is realistic both in its assessments of threats and in its recognition of resource constraints, and which acts responsibly and efficiently in both the development and the implementation of plans for the use of scarce resources.

"It is also imperative that we enhance public confidence in the integrity of the weapons acquisition process. In fairness, one must observe that many of the problems encountered are the

product of a unique environment. Defense programs are often of such size and character that the norms of the market place--which we all understand and which are the standards by which we usually judge defense program performance--do not fully apply. New defense programs often push the frontiers of knowledge--in design and technology, for example--to the point where judgments can only be tentative and where the uncertainties involved can be very large. Nevertheless:

We must reinforce the efforts toward reform already underway.

-- We must improve our planning and review processes.

We must more strongly emphasize accurate cost
estimating throughout the system.

-- We must scrutinize stated requirements more closely
to ensure that scarce resources are allocated optimally
in terms of real need.

We must apply technology to reduce costs as well as
to increase performance.

We must recognize the strengths of our competitive system, and take advantage of those strengths as fully as possible.

We must work with our allies to avoid wherever
practical an unnecessary duplication of effort and
expense.

We must not tolerate a weapons acquisition process
that either encourages or relies upon 'bailouts.'

"In connection with the last point, we intend to follow the course indicated by our recent decisions on the much-discussed contractual problems encountered in the LHA amphibious ship and the F-14 fighter aircraft programs--a course which must protect the public interest in the timely and efficient procurement of

products essential to the national defense, as well as in the sanctity of contracts and the integrity of the procurement system.

"As Secretary of Defense I intend to give close attention to all of the ways in which we can improve our weapons acquisition process. Deputy Secretary William P. Clements, Jr. and I, together with the Service Secretaries and the Service Chiefs, are now reviewing concrete measures to improve our planning and procurement processes. For example, as one step in this direction we have extended the planning horizon beyond the current 5-8 years, in order to assess the longer-term costs of proposed new weapons systems, and their potential impact on the future size of the force structure. By doing so we believe it may be possible to improve the near-term allocation of our R&D and procurement resources. We are extending our efforts to improve our cost-estimating techniques. We are exploring the feasibility of applying the 'design to a cost' concept to all major weapon systems. We are examining ways to strengthen profit incentives for the reduction of costs on major contracts. We will expect cooperation from defense industry in finding more efficient ways to carry out necessary defense programs.

"It is also my intention, and the intention of all of us in the Department of Defense, to continue to seek economies wherever possible in other areas of our defense effort. It is essential, for example, that we use our human resources as effectively as possible, and that we examine closely our manpower requirements. I expect our managers to give close attention to additional ways in which we can improve our management and reduce our costs without sacrificing our capabilities.

Mr. Richardson apparently was going to follow Mr. Laird's procedures of management and it is assumed that Mr. Schlesinger will, at least for the immediate period, also follow Mr. Laird's policy of management. There is nothing at this time to indicate otherwise.

Reading List

1. Bauer, T. W. and Yoshpe, H. B. Defense Organization and Management. Washington, D. C.: Industrial College of the Armed Forces, 1967.

2. Baumgartner, John S. The Lonely Warriors, Case of the Military Industrial Complex. Los Angeles: Nash, 1970.

3. Borklund, Carl W. The Department of Defense. New York: Praeger, 1968.

4. Cleland, D. I. and King, W. R. Systems Analysis and Project Management. New York: McGraw-Hill, 1968.

5. Enke, Stephen. Defense Management. Englewood Cliffs, N.J.: Prentice-Hall, 1967.

6. Hovey, H. A. The Planning-Programming-Budgeting Approach to Government Decision-Making. New York: Praeger, 1968.

7. Knorr, Klaus E.

Mass. Heath,

Military Power and Potential. Lexington,
1970.

8. McNamara, R. S. The Essence of Security. New York: Harper and Row, 1968.

9. Melman, Seymour. The Defense Economy; conversion of industries and occupation to civilian needs. New York: Praeger, 1970.

10. Quade, E. S. and Boucher, E. I. Systems Analysis and Policy Planning. New York: American Elsevier Pub. Co., 1968.

11. U.S. Blue Ribbon Defense Panel. Report to the President and the Secretary of Defense on the Department of Defense. Washington, D. C.: U.S. Government Printing Office, 1970.

EASTERN EUROPE

The year 1973 has been characterized as the "Year of Europe, " and certainly Eastern Europe in this context remains a main consideration. Several of the USSR's eastern European allies have been speaking out quite independently, whether in matters of trade or in the negotiations surrounding the Conference on Security and Cooperation in Europe (CSCE). The atmosphere of East-West detente and the influx of Western capital and technology into Eastern Europe are both serving to promote one of our main policy drives in this area: more freedom in exchange of peoples and ideas.

For your background information on Eastern Europe, there follow some pertinent extracts from President Richard Nixon's May 3, 1973, report to the Congress entitled: United States Foreign Policy for the 1970's--Shaping a Durable Peace.

"Relations with Eastern Europe

"The improvement in our relations with the Soviet Union during 1972 has created a better atmosphere for our relations with the countries of Eastern Europe. But we do not regard our relations with any East European countries as a function of our relations with Moscow. We reject the idea of special rights or advantages for outside powers in the region. We welcomed and responded to opportunities to develop our relations with the East European countries long before the Moscow Summit. And we shall continue to seek ways to expand our economic, scientific, technological, and cultural contacts with them. Mutual benefit and reciprocity are governing principles.

"As the postwar rigidity between Eastern and Western Europe eases, peoples in both areas expect to see the benefits of relaxation in their daily lives. These aspirations are fully justified. An era of cooperation in Europe should produce a variety of new relationships not just between governments but between organizations, institutions, business firms, and people in all walks of life. If peace in Europe is to be durable, its foundation must be broad.

"My visits to Romania in 1969, Yugoslavia in 1970, and Poland in 1972 were designed to help open the door to these broader relationships.