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tration and the Congress may soon have to make a clear choice: either to slip SDI's timetable in order to hold down costs, while maintaining a balance of spending on mature and less-advanced technologies, or to emphasize those technologies that could lead to deployment in the 1990's and hold down costs by delaying higher risk, higher payoff technologies. I think this choice is one of the key decisions that you face regarding the SDI budget, particularly if you decide to place further limits on it.

Mr. Chairman, that completes my statement. Ms. Dombey and I would be glad to answer any questions you have.

Prepared Statement of Robert F. Hale

· Mr. Chairman, thank you for the opportunity to discuss the budget of

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Department of Defense (DoD). Over the next five years (1988-1992), the

request totals about $37 billion. (The total request for SDI research-$5.8 billion in 1988-includes about $600 million for work to be done by the

Department of Energy, but I will focus on DoD funds.)

My testimony describes this SDI request and discusses some important

trends in funding.

Those trends suggest that SDI will consume a sharply

growing share of all DoD research funds. There are also shifts in funds. within SDI that suggest growing emphasis on more mature technologies, though SDI continues substantial funding for many types of technologies.

It is beyond the scope of my testimony to judge the desirability of

these requests. · SDI bas a far-reaching goal:

to deter nuclear war by

defending populations against a nuclear attack rather than by relying

primarily on retaliation to provide deterrence.

The desirability of SDI's

funding requests depends on an assessment of the importance of that goal ·

and the likelihood of achieving it. It also requires examining the impact of SDI funding on other research programs for defense.

OVERALL SDI BUDGET TRENDS

The Administration is requesting $5.2 billion of DoD budget authority for SDI in 1988. The 1988 request makes SDI by far the largest single program within DoD's budget for research, development, test, and evaluation (often shortened to research and development or R&D). The next largest R&D

funding request for which data are publicly available is for the small ICBM

at $2.2 billion. Excluding SDI, the three most expensive R&D programs in

1988 average $1.5 billion each. Indeed, SDr's 1988 budget request exceeds

that of any single procurement program and rivals the R&D budget of at

least one of the military services. The Army-the service with the smallest

R&D budget is requesting $5.5 billion for R&D in 1988 compared with $5.2

billion for SDL

Over the next five years, requested SDI funds for DoD would grow in

real terms by an average of 14 percent a year to $9.8 billion in 1992 (see

Table 1). Total five-year funding would amount to $37.1 billion. SDI's rapid

growth is not unusual for a research and development program. Requested

real growth is, however, sharply higher in 1988 (at 56 percent) than the

average growth over the next five years.

This request is presumably to

make up for reductions in SDI's budget in the previous year (higher growth in

the first year has been a characteristic of recent budget plans for SDI).

TABLE 1. TRENDS IN SDI RESEARCH BUDGETS (In billions of current dollars)

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1.

Bxcludes supplemental appropriatlon request of $0.6 billion. If this request were included, real growth In 1987 and 1988 would each bo 36 percent.

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pero son request of $0.6 billon.

Because SDI is large, its growth means it is consuming a large and

sharply growing share of Dad's budget for research and development

In

1984, SDI consumed 4 percent of Dad's R&D funds; by 1987 that amount bad grown to 9. percent (see Table 1). According to the Administration's request,

SDI will ose 12 percent of all R&D funds in 1988 and 23 percent by 1992.

Moreover, SDI is consuming a growing share of a relatively constant R&D pie. Between now and 1992, DoD is requesting little real growth in total R&D funding (substantial real growth in 1988 will be offset by planned

real declines in future years). As a result, R&D programs other than SDI will experience real declines.

. These budget trends for SDI could continue beyond 1992. Currently, some technologies in SDI are in their advanced development stage, in which they are developed and validated. Around 1992, the Administration plans to

decide whether to proceed to

the more expensive stage of full-scale

development, during which prototype components would be developed and

tested.

In addition, increased research spending in the 1990s on SDI's

companion program-Air Defense Initiative (ADI could exacerbate effects on other R&D programs. The purpose of ADI is to improve air defenses to protect this country against muclear-armed bombers and cruise missiles, much as SDI is designed to protect against ballistic missiles.

These various trends clearly suggest that, under the Administration's

plans, R&D projects other than SDI face tough fiscal times in the next few years. The Congress must weigh any adverse effects an other projects against SDI's importance.

TRENDS WITHIN SDI BUDGET

Most SDI funds are apportioned within five broad budget categories called

program elements.

Figure 1 summarizes the key aspects of these five

program elements.

The first two include funds for weapons that would be

used to destroy enemy missiles:

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. Other Program Elements Surveillance, Acquisition, Tracking. Includes sensors, pointers, trackers, and other systems sad Kill Assessment

to target enemy ballistike missiles and assimilate laformation about their destruction,

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10. Kinetic Energy Weapons (KEW) are those that would destroy an

enemy missile by bitting it with

other object ("hitting a bullet

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with a bullet"). Kinetic enerw technology is more mature and

". would probably be emphasized in any full-scale development of

SDI in the 1990s.

Directed Energy Weapons (DEW) are those that would destroy an

enemy missile with bursts from a laser or particle beam weapon
Directed energy technology is generally much less ready for
development into weapons than is kinetic energy technology.

In addition to two program elements deating witte weapons, there are three

SDI program elements that deal with sensors, system integration, and other

support:

..0. The program

element for Surveillance, Acquisition, Tracking,

i

and Kill Assessment (SATKA) provides fonds primarily for

I

developing sensors and other systems that would detect and

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