Needed: A New Program

Since Korea, one goal of the rearmament program has been to build up a big enough supply of weapons to tide the U.S. over the first year of an all-out war. How big should that supply be? In Washington last week, the Office of Defense Mobilization's eight-man Advisory Committee on Production Equipment, headed by Stude-baker's Chairman & President Harold S. Vance, gave a startling answer: nobody seems to have the faintest idea. Furthermore, the military apparently has not taken into consideration the fact that some items could be brought into full production in a few months, while others might require a year or more. Pentagon estimates, said the committee, "call for greater quantities of military hard goods than the supplies of materials and the manpower and production capacity of the nation could possibly support."

In making an overall survey of postKorea rearmament policy, the Vance committee talked some hard sense about the progress and shortfalls of the arms program. Now that military equipment is coming out in some volume, said the committee, it is time to re-examine the whole idea of building up stocks of weapons that may be obsolete by the time they are needed. The committee's conclusion: the U.S. should stop its hand-to-mouth buying and "substitute, to the greatest extent practicable, production capacity for the stockpiling of military end-items." Much progress has already been made in boosting weapons-making capacity; now the job ought to be finished no matter what the cost. Among the committee's recommendations:

P:By every means possible, e.g., 100% fast amortization and more liberal' treatment under the excess profits tax, the

U.S. should encourage private industry to build the new productive capacity needed.

P: If any new capacity is found to be "commercially nonsupportable," the Government itself should build the needed tools and plants, at a possible cost of $1 billion to $2 billion.

P: The key to production is machine tools.

The Government should spend some $300 million a year to maintain its $6 billion inventory of machine tools, and another $200 million to $500 million a year to buy new ones and get additional plant space.

Such a plan, said the committee, would save money in the long run; "In most [military equipment] programs, the initial cost of facilities is small compared to the cost of producing end-items for the stockpile." Example: thousands of rocket-launching mounts would be needed in the first three years of all-out war --about twice what present plants could turn out in that period. "Yet, an expenditure equal to the cost of producing only 150 of these items . . . would provide . . . production equipment capable of meeting the maximum rate."

In seven months of work, the Vance committee went from agency to agency in Washington, asking questions that often brought quick results. Why was the Army scheduling production of 20,000 M48 Patton tanks while its own estimates showed that there was a need for only 7,500 of them? Lacking an answer, the Army cut its production schedule in half.

Harry Truman's suggested fiscal 1954 budget (see NATIONAL AFFAIRS) also reflects the Vance committee's work. It allows for a cutback in production of 800 defense items, including tanks and trucks, to avoid excess inventories, and requests $500 million for "reserve tools and facilities."

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