Arms Cutbacks and Economic Dislocation

Report Outline
Effort to Reduce Defense Expenditures
Employment Problem in Arms Cutbacks
Measures to Ease Economic Dislocation

Effort to Reduce Defense Expenditures

Anew list of military bases to be closed1 in the interest of economy has been promised by the Defense Department before the end of March. Publication of the list is expected to touch off a fresh spate of objections in Congress, for it will come on top of earlier notice of other base closings and in the midst of a determined drive by the Johnson administration to make all possible cuts in defense outlays. It was on Christmas Eve that the President declared his intention to shut down “every archaic military establishment and take the money and meet unfilled need's” of the American people.

Disquiet Raised by Akms Cut Outlook

Uneasiness in communities that will be affected by closing of military bases is beginning to be felt also wherever the local economy is heavily dependent on defense spending of one kind or another. The uneasiness has been generated by plans to close uranium plants as well as military bases, by U.S. offers at the Geneva disarmament conference to negotiate an agreement to terminate all production of fissionable material for nuclear weapons and to accept a “verified freeze” on strategic bombers and missiles, and by specific proposals for reducing the American defense budget.

All these moves have contributed to a dawning realization that the national economy—so long and so strongly defense-oriented—may actually be headed in a new direction. There is awareness also that, if such is the case, cuts of consequence in military spending ought to be so planned as to avoid or minimize economic dislocation. Planning is believed essential to smooth the transition to an economy that is based less on spending for armaments and more on general private spending and on public outlays to meet the country's basic social needs.