CIA, DEFENSE INTELLIGENCE DIVERGE ON SOVIET ARMS SPENDING GROWTH

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP99-01448R000301210019-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: August 22, 2012
• Sequence Number: 19
• Publication Date: March 18, 1985
• Content Type: OPEN SOURCE

STAT
Declassified in Part - Sanitized Copy Approved for Release 2012/08/22 : CIA-RDP99-01448R000301210019-2
AVIATION WEEK & SPACE TECHNOLOGY
18 March 1985
CIA, Defense Intelligence Diverge
On Soviet Arms Spending Growth
By Brendan M. Greeley, Jr.
Washington?Central Intelligence Agency
estimates of a 1-2% Soviet rate of defense
spending growth for 1983 differ from the
5.8% estimated by the Defense Intelli-
gence Agency but do not indicate any
split between the two agencies, according
to Robert Gates, chairman of the Nation-
al Intelligence Council and deputy direc-
tor for intelligence at the CIA.
The CIA figures became available with
the publication of a censored version of
testimony given by Gates before a closed
session of the subcommittee on interna-
tional trade, finance and security econom-
ics of the Joint Economic Committee of
Congress. The CIA believes that it is too
early to estimate 1984 growth, while the
DIA believes growth continued at the
same 5-8%.
Gates said that estimates of Soviet de-
fense spending are subject to great uncer-
tainties because analysts look at Soviet
defense hardware and force levels and fig-
ure the cost as equivalent to what it would
cost the U. S. to field a similar establish-
ment.
Because prices are determined by differ-
ent factors in the West than in the Soviet
Union, the comparisons are at best indica-
tions of relative, rather than absolute,
spending levels.
Both agencies agree that there was little
real growth from 1975 through 1982, al-
though Soviet defense spending remained
at a very high absolute level. "It is time
for Washington to take official notice that
Soviet military procurement has been stag-
nant for the past seven years and to stop
acting like nothing has happened," Sen.
William Proxmire (D.-Wis.) said. ? "It is
true that military procurement has leveled
off at a rather high level, and the Soviets
have been able to add large numbers of
weapons to their' inventory despite the
slowdown."
USSR Inventory
During the period referred to by Prox-
mire, 1977-83. the CIA lists the following
purchases by the Soviets:
? 1,100 intercontinental ballistic
sues.
? 700 submarine-launched ballistic
sues.
mis-
mis-
? 300 bombers, including Tu-22M/Tu-
26 Backfires.
? 5.000 fighters, including MiG-23/27
Floggers.
? 15,500 tanks, including T-72s.
? Substantial numbers of naval surface
combatants and submarines.
Gates pointed out that even though the
rate of increase slowed or stagnated dur-
ing the period, the Soviets were already at
such a high spending level that they were
able to. modernize and improve their
forces substantially.
"The best measure of Soviet military
capabilities for use by U. S. decision-mak-
ers is what the Soviets actually have
bought, are deploying and are develop-
ing?rather than an artificial reconstruc-
tion of what it cost them," Gates said. He
added that cost comparisons have value
only when used as analytical tools by ex-
perts who understand their very signifi-
cant limitations.
. Fighter Production
Defense Secretary Caspar Weinberger
made the same point last year when he
said the Soviets were producing about 840
fighters a year while the U. S. was produc-
ing 350 (Aw&st Feb. 13, 1984, p. 11).
Summarizing CIA testimony over the
years, Gates stated that Soviet economic
growth, which military growth closely
matches, was quite strong during the
1960s and the first half of the 1970s.
The mid-1970s marked a turning point
when the economy began to decelerate
and eventually fell below 2% growth
from 1979-81. Since then, it has rebound-
ed.
The Soviet gross national product is
very sensitive to fluctuations in agricultur-
al production, and the slump in GNP in
the late 1970s is tied closely to poor har-
vests in those years. Farm output rose by
in 1983, reaching an all-time high,
d 1984 should reflect similar gains.
- Industrial production grew by 3.4% in
1983, and a similar rate seems likely in
1984. The most significant improvement
:has been in the production of raw materi-
.als and intermediate products. Poor per-
formance here in the late 1970s created'
Ibottlenecks, which affected the entire
.economy as requirements outpaced sup-
plies. In some cases, notably steel, imports
: have been used to take up the slack.
Chemical output gains also contributed to
f,-
it growth.
ruel Concern
p- The energy situation in the Soviet
Union remains a problem. Coal produc-
tion continues to fall and oil production
r shows scant growth. Gas production is
F up, though, and electric power is becom-
ing more plentiful.
? The CIA attributes the severity of the
late 1970s slump to a transportation sys-
tem unable to meet demands placed on it
.",*in a country whose size requires an effi-
cient network.
k" A poor showing by the railroads during
Q. this period is partly to blame, and im-
rprovements in this sector have helped the
L' industrial recovery.
72,z The amount of gas transported by pipe-
line continues to rise at double-digit rates,
but traffic on highways and rivers has
declined.
The CIA estimates the fiare of the So-
viet GNP allotted to defense spending at
13-14%, almost double that in the U. S.
This 13-14% share has remained relative-
ly constant since 1965 because defense
growth has matched economic growth.
Some key industries devote disproportion-
ately large amounts of their total output
to defense. For example, more than 25%
of all machinery production goes to de-
fense as well as 20% of all metallurgy
production.
As examples of intangibles that increase
the burden of defense on the economy, the
military has priority access to:
? Highest quality raw materials for de-
fense.
? Transportation and distribution of
raw materials.
? Best industrial workers for the de-
fense industry. ?
? National pool of research talent.
? Most advanced machinery.
As examples of intangibles that help the
economy, the CIA cites possible use of
troops and equipment in construction and
in helping with the harvest.
CIA estimates of the defense burden do
not consider the following:
? Subsidized weapon sales.
Declassified in Part - Sanitized Copy Approved for Release 2012/08/22 : CIA-RDP99-01448R000301210019-2