PROBLEMS AND CONCERNS • INCREASING WEAPONS SYSTEM COSTS • IMBALANCE BETWEEN SHORE SUPPORT • DIMINISHING SEALIFT CAPABILITY OF U.S. • RISING COSTS TO SUPPORT ENVIRONMENTAL • ALL VOLUNTEER FORCE PROBLEMS AND CONCERNS THE SOVIET THREAT • OUR MOST SERIOUS CONCERN • TECHNOLOGY NEW, ADVANCED DESIGNS IN SHIPS, AIRCRAFT, • EXPANDED ACTIVITY MEDITERRANEAN, NORTH ATLANTIC, CARIBBEAN, • SUBMARINES OUTNUMBER U.S. IN ATTACK SUBS AND BUILDING HIGH PRIORITY TO SSBNS 74-696 - 72 - pt.2 - 39 You know how well they have expanded in the Mediterranean, North Atlantic, Caribbean, and the high attention they are giving to building their so-called Yankee submarines. Here are some comparisons between the different appropriations in the 1972 and 1973 budgets. You have given a good deal of attention to the cost of our manpower, and you can see it goes up in 1973. Operation and maintenance has about the same amount of money. Procurement, aircraft and missiles, about the same, but with shipbuilding we go up. The money requested for ULMS pushes the shipbuilding appropriation up. Of course, a lot of the ULMS funding shows up in the R. & D. Another reason for increased funds for shipbuilding would be the new aircraft carrier, plus the six submarines. Those six submarines, of the 688 class, come to $1 billion. That is the largest number of submarines we have requested during my tenure. ULMS also contributes to the increase in other procurement and research and development appropriations. Military construction is up a little bit. What are we getting? This is a brief summary of what the budget includes. For the shipbuilding and conversions, seven destroyers of the 963; this will be next to the last buy. In other words, if we get these then in 1974 that will complete our 30-ship program. Six 688 class nuclear attack submarines which I mentioned. Congress gave us the five last year and long leadtime funds for a sixth. Congress is very keen on those submarines. Senator DOMINICK. That is the attack submarine? Secretary CHAFEE. That is the attack submarines; yes, sir. This is the hydrofoil missile ship; we have to get going with it. It doesn't represent a substantial sum of money but it is the possible wave of the future. This is the PF which you discussed, which we will have a hearing on; that is $190 million for the first vessel. These are the submarine tenders. We have to get going with these tenders. Whenever we want to save money we seem to cut the tenders. We just can't keep it up any longer. Here are your Poseidon conversions and submarine tender conversion. Here is the new construction basically 20 new ships and nine conversions. For aircraft we are requesting 282 aircraft. That number of new airplanes just doesn't replace our attrition and our losses, but these are so expensive and that is the best we could do with it in our budget. Sixty-six of them are for ASW, that is, the P-3Cs and S-3As. 43 are attack. A-7s, and A-6Es, and seven electronic warfare aircraft, EA-6Bs-the A-6 and EA-6B are both Grumman aircraft. There is the Harrier for the Marines, the F-14, again, it is another Grumman aircraft. Trainers, transports these VH-53 helicopters are for White House use but we are the designated purchasing agent. What about the money? Well, you can see in taking it in current dollars, each year the cost is going up. Taking it in constant 1964 dollars and wringing out the inflation we are down less than most of the Vietnam years. Here at the peak of the Vietnam war, were the peak expenditures. We are up somewhat from where we were in 1972, but not much above what we all considered the last peacetime year, 1964. • 1 SUBMARINE TENDER • 2 RESCUE AND SALVAGE SHIPS • 6 POSEIDON CONVERSIONS • 2 DLG AAW MODERNIZATIONS • 1 SUBMARINE TENDER CONVERSION FY 73 FY 73 BUDGET AIRCRAFT PROCUREMENT • 66 ASW (24 P-3C, 42 S-3A) • 48 FIGHTER (F-14) • 8 EARLY WARNING (E-2C) • 24 TRAINERS (T-2C) • NAVAL FORCES PROPOSED IN FY73 BUDGET ARE MINIMUM TO SUPPORT NATIONAL POLICY In constant dollars we are up some. In 1964 that was about $15 billion and we are up to about $17 billion. Of course, the major change in the equation has been the Soviets. In summary, we have made progress but the Soviets have also increased their capability. Our need to use the world's oceans is growing, particularly as we become more and more of an import nation, especially as regards oil. We feel this fiscal year 1973 budget request is sound and we are prepared to support it. Thank you very much, Mr. Chairman. (Prepared statement follows:) SECNAV FISCAL YEAR 1973 PROGRAM AND BUDGET STATEMENT I. Introducton This being my fourth year before this committee, I believe it useful to present the Department of the Navy's fiscal year 1973 program and budget in the context of what has transpired during my tenure as Secretary of the Navy and what I foresee in the future. First, I would like to restate what our major objectives have been during the past three years and review our progress toward achieving these objectives. Then I will discuss some continuing problems and future concerns. Finally, I will explain how our FY 1973 budget is intended to continue the Department's progress toward the objectives which we have been pursuing. Many of the issues that I addressed last year are still with us. Nonetheless, a year provides us a fresh look at the recent past and a new look into the future. When I took office in January 1969, the United States was heavily committed in Vietnam. This effort had first call on our talents and resources during 1969, and to a lesser extent in 1970 and 1971 as we quickened our withdrawal. Our latest ships and most modern aircraft were being sent to this theatre. The Marine Corps had over 25% of its personnel deployed in Vietnam and the Navy was assigning thousands of its best young officers and enlisted men to in-country billets. Seventh Fleet ships and aircraft had top priority in the Navy for not only the latest weapons, but also for people and for logistic support, at the expense of all other naval units including those of the Sixth Fleet. The Vietnam war has had an adverse impact on the overall readiness, modernization rate, and retention of military personnel in the Navy and Marine Corps. Our weapons stockpiles were reduced, shipbuilding and aircraft procurement programs were slowed, overhauls and maintenance were deferred, and many of our officers and men were subjected to repeated tours in combat and prolonged absences from their families. II. Objectives and accomplishments To support the national security strategy of Realistic Deterrence, which Secretary Laird enunciated last year, we determined a number of objectives for the Department which I would now like to discuss. Our first objective has been to contribute most effectively to the goals of Vietnamization and end American involvement in Southeast Asia at the most rapid pace possible. Simultaneously we have pursued the following four additional objectives: Improvement of the operational and materiel readiness of Navy and Marine Corps forces, with special emphasis on units deployed overseas. Modernization of Navy and Marine Corps weapons systems. Effecting more efficient and cost conscious management of our resources. Improvement of recruiting and retention of high quality military personnel in the Navy and Marine Corps, in support of the National goal of achieving an all volunteer force by July 1973. I would like now to review our progress in the past three years toward achieving each of these five objectives. Southeast Asia Withdrawal and Vietnamization.-Our most important objective in South Vietnam has been and remains to help that country attain a reasonable chance for self-determination. Our efforts in meeting the overall Vietnamization timetable have continued with great success during these three years. As of 1 January 1972 all but 500 Marines had been withdrawn and only 8000 Navy personnel were still in-country. As a result of the President's announcement, we plan a substantial reduction in the Navy numbers by 1 May 1972. The South |