tional remoteness from the services. They would be viewed as outsiders, not as members of the service family. This status would greatly hinder their effectiveness. REDUCE SIZE OF SERVICE MILITARY HEADQUARTERS STAFFS In lieu of integrating the staffs, the Senate committee's staff report raised reductions in the size of the service military headquarters staffs as another option for reducing layering. We are already doing this. I assure you that General Wickham and I intend to seek ways to further streamline and reduce the size of the Army staff, including delegating more responsibility from the headquarters to the major Army commands. DEFENSE AGENCIES I have not advocated the elimination of defense agencies and I have no comments as to the adequacy of financial oversight of their activities. The basic purposes for establishing defense agencies are the economies and efficiencies that can be achieved by consolidating certain common support or service functions in a single agency. I believe this to be the case with the Defense Logistics Agency, particularly with respect to food, fuel and non-critical spare parts. Although it might be possible to return certain commodities to the services, it would be unwise to disestablish the agency. Certainly, it would be virtually impossible for the Army to absorb its share to DLA's responsibilities without additional resources as suggested by House bill number 4068 introduced by Congressman Courter on January 29, 1986. This is consistent with my testimony before the Senate Armed Services Committee on December 6, 1985, during their hearings on defense organization. Congressman Courter's bill also proposes to abolish the Defense Contract Audit Agency and transfer its functions to the military departments without resources. Should this occur, the Army would be without a capability to audit Army or related portions of defense contracts. This is a highly specialized auditing skill that does not now exist in the Army audit agency nor anyplace else in the Army. Further, the Army audit agency is neither configured nor staffed for the function. I firmly believe, that if the mission was given to the services, more resources would be required than now, for basically the same case load. One final consideration, by having the Defense Contract Audit Agency at the defense level, it achieves greater credibility than if the services were performed at the military department level where the basic contract decisions are made. I have not addressed all the areas covered by the subcommittee's letter. However, I will be happy to try to answer any questions which you may have. Mr. NICHOLS. Thank you, Mr. Secretary. Mr. ROURKE. No, sir, I'm the junior man on the pole. I defer to my more senior and better looking partner, Mr. Lehman. Mr. NICHOLS. Secretary Lehman? STATEMENT OF HON. JOHN LEHMAN, SECRETARY OF THE NAVY Mr. LEHMAN. Thank you, Mr. Chairman. I would also like to submit my statement for the record. It is an embodiment of philosophy that you are well familiar with. Our approach in the Navy Department, is an approach that is the product of 5 years of basically applying Secretary Weinberger's philosophy of increasing the strength of centralized policymaking from the Secretary of Defense, and decentralizing the execution. It is an important starting point to recognize the vast scale that we are dealing with when we talk about the Defense Department and, indeed, the military departments. The Department of the Navy alone has a larger budget this year than all but two of the Cabinet agencies outside of Defense. Just the Navy Department is larger in number of employees and in the size of its budget than all seven of the Cabinet agencies combined that are not entitlements agencies, the checkwriters. In the Department of the Navy alone, just in our industrial funded activities we have four Fortune 500 size businesses, and that's less than 20 percent of our total activity. Our naval shipyards organization would rank 92d in the Fortune 500. Our air rework facilities would rank 232d. Our public works facilities would rank in the low 400's. Our weapons stations organization would rank in the mid-400's of the Fortune 500. These four totally separate, totally different kinds of enterprises, altogether make up less than one-fifth of our overall activity in the Department of the Navy. So it is not easy to generalize about what is right and what is wrong in specific details. That is why I think that Secretary Weinberger has chartered a path that is revolutionary because it's the first time the complexity of the enterprises under the roof of the Pentagon have been recognized in a management philosophy. We must have a strong centralized policymaking executive over all of the services. We must have a strong devolution of execution of authority based on a principle of line accountability rather than the false principle of matrix staff management that has afflicted the Department for the last 30 years. Good people, given the authority and held accountable, can make our defense work very well. The best organization will not compensate for the lack of good people. So, I think, as you approach this problem, you need to keep in mind not only the vastness and complexity of what we do but also, principles of decentralized management and centralized policymaking. Use that as your compass in applying specific statutory changes. I believe that the single biggest problem preventing the good people that we have in the defense establishment from doing a good job is a bureaucratic bloat that has grown steadily over the last 30 years with a driving force of its own. In the last 10 years we have seen an increase averaging about 10 percent a year overall in the size of our bureaucracy. The same affliction applies to our equal partners in the providing of that common defense, Congress. Last year, you will recall, I testified that in 10 years, we had grown from reporting to four subcommittees and committees to reporting to 42, as of last year. I am sorry to have to report to you that not quite a year since I appeared before you on the same subject, we're now up to 46 committees and subcommittees. All of them write legislation, or have oversight of one kind or another over Department of the Navy activities. I'd like to submit this list of the subcommittees we have appeared before in the 12 months since I have- Mr. NICHOLS. Without objection, that will be included in the record, Mr. Secretary. Mr. LEHMAN. So my point is, Mr. Mr. NICHOLS. Mr. Kasich wants to question you. Mr. KASICH. I think what you said, Mr. Secretary, means you're popular, in great demand. Mr. LEHMAN. Alas, it is not me, but my bureaucrats that tend to spend most of their time up here. And-because I enjoy it so much, I'd like the opportunity. But it's not the appearances. There's nothing more appropriate than the give and take, and the proper dialog, and the policymaking that goes on between the proper Committees of Oversight and Appropriations, and the Department. It's embodied in the Constitution. It was intended and that is a very healthy process. What I urge you to address is the anarchy that has broken out up here over the last 10 years in committee jurisdiction. The result, by actual measurement, as of last July, is 1,152 linear feet of legislation and enacting legislation in the law library. That has been a huge engine of bureaucratic bloat. It is that bloat of horizontal growth in numbers of bureaucrats, and in the vertical growth in the layers of bureaucracies, that is the single greatest dysfunction in our common defense today. Congress shares at least an equal responsibility for its cause, creation, and maintenance. So I would urge you to address that. I would like to address some of the specifics that you asked us to address in the letter that you sent-and so, if you'll bear with me, just a few specific comments. First, regarding the unified and specified commands. Since last year and the debate on the bill that you passed, there has been the emergence of a whole new theme over on the Senate side. You asked us to address that theme, which is to transfer a very substantial amount of defense policymaking to the unified and specified commands. I think that this is a very unfortunate and dangerous turn of tide. For instance, the lessons of Beirut, one of the more recent examples, with which you personally are so familiar, illustrated that what is needed is not to bring the unified commanders and their chains of command more into the bureaucracy, giving them more budgeting, and execution, financial, and bureaucratic activities. They should be given fewer, to streamline them, to make them better able to operate the forces that are assigned to them. It is the combatant commands that should fight the wars, and run the crises management of the unified forces under their command. That is what should be clarified, the actual command relationships. I do not think there's a serious problem there. I do not have any say in where the aircraft carriers Coral Sea and Saratoga are moved and when they're moved, and I should not, except as an adviser to the Secretary of Defense. I should have no line authority, and I don't. That is under the total authority of the theater commander. It is he who moves our Navy battleships, our carriers, our marine amphibious ready groups, and so forth. He does have operational control. Clarifying exact relationships in JCS Pub. 2 is a useful and needed exercise. It needs to be updated. But I deplore the suggestions contained in the questions that you have asked of the Secretary, that what is under consideration is a serious shift of budgeting and contracting and business management to those already bloated bureaucratic staffs. The reverse effect is what needs to be addressed in the joint command structure. We need fewer layers of command, and smaller, not larger staffs. We don't need them to get more involved in contracting, and overhaul policy, and budgeting, and programming. That's not their job. Their job is to fight the forces, and operate the forces that are provided to them by the Secretary of Defense and military departments. Of course, they must have a strong voice in priorities as each budget is prepared. Secretary Weinberger has brought them directly into the DRB [Defense Resources Board] process, and they've never had a more active voice. They spend about 4 to 6 days a year with us, in the DRB, commenting, criticizing, and participating in the military preparation of the budgets of the military departments. So, I would urge you to go in the other direction than the one that is contained in the draft Senate bill and to take the lessons of your own report following the Beirut issue. Streamline the combatant command structure and strengthen its clear lines of authority. You asked us to comment on the joint military personnel system. As you know, and as I've commented before to this subcommittee, I disagree with the philosophy of making joint specialists-specialists at staff work. I don't think we need more. I think we need less professional bureaucrat career patterns. What we want out of military staffs, the Joint Staff, and the military department staffs, is people with better operational experience, better credentials in driving tanks, and flying airplanes, and driving ships. So, I don't like the approach that is implied in the questions that you have asked. I think consolidating the military department headquarters staffs is a good idea, with all due respect to my senior colleague, Secretary Marsh. Over the last 5 years, by ad hoc measures we have effectively and almost completely consolidated the Department of the Navy staff. On the books, it looks different than it is, in fact. Five years ago for instance, we had two stages in preparing the Navy budget. First there was a CNO executive board meeting that initiated a policymaking process from which a position was taken. Only then would it come forward to the service Secretary staff. It would then go through another process, and another series of meetings. Jim Watkins, P.X. Kelley, and I, have found it much more effective to go through that process together. It has streamlined the process, saved us a lot of time, and allowed me to reduce our combined staffs by about 15 percent. I think we can go further. With the debureaucratization we've done in the last year, getting rid of the Naval Materiel Command-now the three systems commands report directly to me and to CNO together-we've cut out two whole layers, and two whole steps of delay. Our comptroller functions are combined and integrated. Our lawyers are combined and integrated, although not in the sense of combining the JAG with the general counsel. I agree with Secre |