Future of U.S. Defense Economy

September 24, 1969

Report Outline
Pressure to Put Curbs on the Military
Economic Aspects of Military Spending
Means of Adjusting to Reduced Spending
Special Focus

Pressure to Put Curbs on the Military

Defense spending has been subjected in 1969 to more searching criticism than at any time since the cold war began. Attacks on the “military-industrial complex” in Congress and the press destroyed the nearly sacrosanct status formerly enjoyed by Defense Department budget requests. Although the critics failed to make any major dents in the military budget, the challenge they mounted was strong enough to put the Pentagon and its spokesmen in Congress on the defensive—a feat that would hardly have been possible a short while ago.

The outburst against military-industrial predominance coincided with four other developments pointing toward cutbacks in production for national defense: (1) The peace talks at Paris and initial troop withdrawals from Viet Nam focused attention on the economic consequences of bringing the war to an end; (2) plans for a multi-billion-dollar anti-ballistic missile system and other high-priced weapons sharpened interest in getting U. S.-Soviet talks on strategic arms limitation under way; (3) rising pressure for domestic programs to deal with the crisis in the cities established serious competition for dollars now spent on defense; and (4) inflation impelled the Nixon administration to effect certain cuts in the military budget. This multiple threat confronted defense industries, their employees, and their communities with the prospect of major dislocations in the foreseeable, if not the immediate, future.

Revolt Against Military-Industrial Complex

When the Senate on Aug. 6 accepted development of the Safeguard A.B.M. system by a hairbreadth 51–50 vote, it was clear that the cold war tradition of congressional acquiescence in defense budgets was dead. The next day the Senate voted 47–46 to require quarterly Pentagon reports on all major weapons systems contracts and General Accounting Office audits and reports on such contracts. The military procurement authorization bill was soon subjected to a blitz of proposed reductions.

ISSUE TRACKER for Related Reports
Defense Spending
Nov. 03, 2017  Military Readiness
Sep. 07, 2001  Bush's Defense Policy
Jul. 30, 1999  Defense Priorities
Sep. 29, 1989  Can Defense Contractors Survive Peace?
May 17, 1985  The Defense Economy
Apr. 16, 1982  Defense Spending Debate
Oct. 10, 1980  Defense Debate
Apr. 12, 1974  Peacetime Defense Spending
Sep. 24, 1969  Future of U.S. Defense Economy
Oct. 26, 1966  Defense Spending Management
Feb. 19, 1964  Arms Cutbacks and Economic Dislocation
Jun. 10, 1953  Defense Spending and Reorganization
Jan. 18, 1950  Civil Defense
Nov. 03, 1948  Atlantic Security and American Defense
Defense Budget