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Mr. VANCE. Mr. Bates, I believe that section 202(c) (4) provides the Secretary of Defense has the authority to assign or reassign to one or more departments or services the development and operational use of new weapons or weapons systems.

Mr. BATEs. That is what I said, you can give it to one and give them all to one.

Mr. VANCE. Military department or service.

Mr. Bates. There is that possibility. One of the services. So I said you can wind up with the Army only with the title “Army," no functions, no weapons.

Mr. VANCE. No. By statute it is charged with conducting land warfare.

Mr. BATES. Oh, sure.

Mr. Hardy. But it doesn't have any weapons to use. What is it going to do?

Mr. VANCE. Well I do not

Mr. HARDY. You can nullify the statute with this arrangement you've got now, can't you?

Mr. VANCE. No; I do not believe you can.

Mr. BLANDFORD. You don't interpret that to be exclusive jurisdiction on the part of the Army?

Mr. VANCE. I am sorry, I don't understand your question.

Mr. BLANDFORD. You said the Army has the responsibility for land warfare. Would you interpret that to be complete jurisdiction in the hands of the Army?

Mr. VANCE. No; by statute the Marine Corps has the responsibility for amphibious warfare which includes land warfare.

Mr. Bates. There is language that gives the Secretary of Defense authority to assign any weapons to any individual service. That is a statute, too.

Mr. BLANDFORD. It raises some interesting points with regard to STRICOM.

Mr. Hardy. You get a new rifle and you assign it to the Navy, but they wouldn't be able to use it except aboard ship.

Mr. BATES. What ship? Those might be in the Air Force.

Mr. BLANDFORD. Mr. Chairman, I would like to-it is obvious we are not going to get a definition of service activity and the law is rather broad and apparently the Secretary's position is the law should not be changed, it should be flexible.

You would not recommend a change in the law to delineate it any further. What is the procurement authority, specific procurement authority now for these defense agencies, Mr. Secretary? Mr. Vance, I think, knew in advance that this question would be asked. Do you have a compilation of laws or statutes?

Mr. VANCE. Yes, Mr. Blandford. First, by directive the Defense Supply Agency has been charged with the responsibility of furnishing logistic support to the military departments in connection with items and services which are common to more than one military department.

Now DSA was established pursuant to the provisions of the McCormack amendment, that is section 202(c) of the 1958 act.

I believe it is clear not only from the language of the amendment itself, but also from its legislative history that the Secretary of Defense has authority to provide for the acquisition of common services and supplies through such organizational entities as he determines are necessary. In that connection Congressman McCormack stated on the floor that the term "common supply and service activities" was intended to include procurement, warehousing, distribution, cataloging, and other supply activities." ' This I believe was a recognition that the authority to procure supplies is inextricably part of the authority to create an agency to carry out the supply functions.

And further the authority to procure carries with it the authority to contract.

Mr. BATES. That would be fine if the record said that the Department of Defense had the authority to get into operational details, but it specifically says "No."

Nr. VANCE. I would further point out that in Mr. Vinson's statement on the floor he stated it is the purpose to bring about a more unified and economical procurement of items which are common to two or more military services.

Mr. BATEs. Managed by a single manager, which you already had in effect.

Mr. BLANDFORD. Is that your answer, Mr. Vance?
Mr. VANCE. That is my answer.

Secretary McNAMARA. I would disagree with the statement Mr. Bates made. I don't believe it can be done under a single management.

Mr. BATES. You say it cannot?
Secretary McNAMARA. I do not believe it can.

Mr. Bates. Many, many people thought the single manager was the answer, many people today think it is, so it is a question of judgment.

Secretary McNAMARA. It is more than judgment, it is a question of proof at this

point. Mr. BATES. What can you do under this that you really couldn't do under the single management concept?

Secretary McNAMARA. I think we can prove that we will save men and money and material through the Defense Supply Agency that were not saved under the single management concept.

Mr. BATES. That is a general statement.
Secretary McNAMARA. I can prove it.
Mr. BATES. I would like to see that proof.
Secretary McNAMARA. We will be very happy to.

Mr. HARDY. I don't think anybody would be able to either prove it or disprove it until after it has been done.

Mr. Bates. It is not bearing on the particular point I am making, but I would be interested in seeing it. Secretary McNAMARA. This is the

foundation of the argument for the Defense Supply Agency. If the Defense Supply Agency does not save men, money, and material, in my opinion it was a mistake to establish it.

Mr. Hardy, I hope we don't find out it wasn't.

Secretary McNAMARA. I don't believe you can, because I think we can show you without any question that the Defense Supply Agency will save literally hundreds of millions of dollars and a major portion of that savings has already been budgeted and programed in 1963 and the appropriations presented to the Congress; the appropriation requests took account of that.

Mr. Bates. Who is going to supervise this organization? Secretary McNAMARA. It is being supervised by General McNamara, who is in command of it.

Mr. BATEs. It is going to be its own supervisor?

Secretary McNAMARA. And in addition to that there is an advisory group containing the Chairman of the Joint Chiefs and representatives of the three military departments.

Mr. BATES. Now, how much are the Joint Chiefs ever going to get into a matter like that on efficiency?

Secretary McNAMARA. To the extent that the Defense Supply Agency fails to properly supply the unified command and/or the military departments, the Chiefs would, of course, be parties in interest and would be expected to be involved in it.

To the extent that efficiency estimates or savings estimates are involved, the military departments quite clearly would be interested parties and have to date, and will, I am sure, in the future, continue to pay close attention to those estimates.

Mr. BATES. Mr. Secretary, why wouldn't it have been possible to continue the Armed Forces Supply Support Agency—is that the title?

Mr. VANCE. Center.

Mr. BATEs. Center, yes—and use that as a supervisory organization? I have read a lot of these reports and they talk about the different requisition forms, that is one reason why we have got to establish DSA, but not a very good reason, because this other agency could have said: "Go ahead now, tidy this up, get common forms, cataloging, and standardization."

Secretary McNAMARA. Yes, I think that conceivably it could function in that form, and then, of course, operational control to the extent that you have described it is not in the military departments, but in this new Agency. And there is no difference, as I see it, between Defense Supply Agency and the new Agency operated as you have described it.

Mr. BATES. Oh, yes; but I am talking about the functions they were performing and they went into cataloging and they went into standardization, but the operational functions are still under the single-manager concept.

Secretary McNAMARA. If this Armed Forces Service Supply Center you described can dictate the requisitioning procedure to be followed by the single mission of all the departments, it quite clearly is making operational decisions.

Mr. BATES. Make policy decisions.

Secretary McNAMARA. Perhaps we should define "policy.". But determining the form of a piece of paper to be used when a procurement order is to be placed, I would say is an operational decision rather than a policy decision.

Mr. BATEs. We can get into this later. I don't want to take the time now on details of this particular program. I would like to get into all of this extensively when we talk to the heads of the individual departments.

Secretary McNAMARA. I would be happy to have you do so.

Mr. BLANDFORD. Mr. Vance, I call your attention to section 9 of the 1958 amendment which established the Director of Defense Research and Engineering. Here Congress very clearly spelled out the authority of this office by stating:

(2) The Secretary of Defense or his designee, subject to the approval of the President, is authorized to engage in basic and applied research projects essential to the responsibilities of the Department of Defense in the field of basic and applied research and development which pertain to weapons systems and other military requirements. The Secretary or his designee, subject to the approval of the President, is authorized to perform assigned research and development projects : by contract with private business entities, educational or research institutions, or other agencies of the Government, through one or more of the military departments, or by utilizing employees and consultants of the De partment of Defense.

(3) There is authorized to be appropriated such sums as may be necessary for the purposes of paragraph (2) of this subsection.

The law spells out the authority of the Director of Defense Research and Engineering.

Now, isn't it a basic fundamental rule of law that you must consider laws pari materia, since that was one of the arguments put forth by the Department of Defense in a recent case before the Federal court, and that you cannot consider these two sections apart?

Here we have a section which clearly delineates the authority of the Secretary of Defense. Can you also point out a section which clearly delineates the authority of the Secretary of Defense or the Defense Supply Agency to engage in any procurement activity on its own?

Mr. VANCE. I think that the legislative history of the McCormack amendment makes it very clear that the responsibility did pass to the Secretary of Defense when it gave him the authority to create such agencies to carry out the functions in the common supply and service

areas.

Mr. BLANDFORD. Through an organization that had the authority to engage in contracts ?

Mr. VANCE. I am afraid I don't understand you, sir. Mr. BLANDFORD. Well, I am simply trying to ascertain the authority of the Defense Supply Agency to enter into contracts as an agency. Is it a valid contract if they enter into a contract?

Mr. VANCE. Yes; I think it is, Mr. Blandford, for the reasons I have already given.

Mr. BLANDFORD. And I have given you the reasons why I don't think it is, because I don't think you can interpret one section to suit yourself and then turn around and ignore another section which clearly spells out the authority for the Director of Defense Research and Engineering with the approval of the Congress spelled out very clearly.

Mr. VANCE. First, may I say, Mr. Blandford, that as I recall it, the McCormack amendment was put in on the floor of the House and this other language was already in there when the bill went to the floor.

I do not think that the mere fact that it is spelled out in section 203 (b) (2) that he has specific authority in the field of research and development precludes him from having the authority under another section of the act.

Mr. BLANDFORD. Your position is that the Director of Defense Research and Engineering then would have had the authority to engage in research contracts without any action on the part of the Congress?

Mr. VANCE. I think it might well be that he would, as an agent of the Secretary of Defense.

Mr. BLANDFORD. Any agency created then by the Secretary- I don't want to put words in your mouth, I know you are too good a lawyer for me to try to put words in your mouth-are you saying that any authority that the Secretary has, he can delegate and that this is an implied authority on the part of any agency he creates to engage in contracts

Mr. VANCE. I believe that the act provides that the Secretary can delegate his authority to such agencies, or organizational entities as he may choose.

Mr. BLANDFORD. And it is your opinion, then, that the Secretary could have given the Director of Defense Research and Engineering this authority, and if so, are you using the doctrine of implied powers?

Mr. VANCE. Yes; I am, Mr. Blandford.

Mr. HARDY. Mr. Secretary, I would like to take a few minutes to discuss one or two other points in your statement.

At the bottom of page 3 you are discussing fragmentation and the need for eliminating fragmentation, and you say: Fragmentation of the Defensewide functions now performed by these agencies among the three military departments and other components of the Department was inefficient and uneconomical. It resulted in a decreased combat effectiveness.

I wonder if you could pinpoint that a little bit and tell us how?

Secretary MCNAMARA. Yes; I would be very happy to, if I may come to the desk before you. I have three charts which are very small that I would like to talk from, if I might.

Mr. Hardy. Why surely.

Secretary McNAMARA. I am going to speak with particular reference to the Defense Communications Agency. In discussing the first, the defense communications system, in the continental United States, here are essentially the long lines systems of the Army [indicating] Here are, in blue, the systems of the Navy; here are in green the systems of the Air Force, and here are the systems of NORĀD, SAC, and certain other miscellaneous agencies in addition.

As you can see, there is a very complex pattern of tracing by the several colors showing the different systems.

This simply indicates that we have great potential for backup, if not for duplication, at least for backup, in emergency and reserve support to one system from another system in case the first fails.

Until the Defense Communications Agency, there was no capability to provide such emergency reserves by one system to another system.

That capability is now being developed. It has already been brought into effect to a certain degree. This clearly increases the combat potential and effectiveness of these particular systems. All I have said so far relates to Continental United States.

Here is a similar pattern worldwide.

This is a polar projection of the Army net, looking at it upside down.

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