ACUTE ASPRISMATISM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78T02095R000800020012-7
• Release Decision: RIFPUB
• Original Classification: U
• Document Page Count: 5
• Document Creation Date: December 16, 2016
• Document Release Date: November 23, 2004
• Sequence Number: 12
• Publication Date: March 13, 1967
• Content Type: NOTES

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Approved For Release 2M'
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Acute Asprismatism
Some comments on MichaJf Kalecki's art4cle "Vietnam through the US Prism"
in Polityka, number 3. January 21, 1967.
Kalecki's facts concerning aggregate defense expenditures and GNP
in the US are not and need not be at issue -- although we note in passim
that he shows little discrimination in distinguishing between total
defense expenditures and those related to the Vietnam war. His basic
economic ument is the issue over which we may profitably cross swords.
Straightforward facts challenge his assumptions about the geographic
distribution of US defense expenditures. Kalecki.agrues, on a quasi-
socio-cultural basis, using Marxist terminology, that there are'two
classes of capitalists in the US: those old-established industrialists
of the northeast and inidwest, and the "new" industrial owner classes
of the south and far west. He sees the "new"group as villains; unlike the
older group of "Wall Street Imperialists", which he says has developed
peace-loving tendencies, this new breed mongs war with great energy. He
argues that when defense expenditures skyrocketed in 1966 (especially in
the second half), the capitalists of the west and south were the principal
I
beneficiaries and that their economic interests and the prolongation of
the Vietnam War are coincident. He concludes that, through their
influence, the War is likely to continue for some considerable time.
If we accept, as a stalking-horse, Kalecki's assumptions about the'
class structure of American capitalism, his argument disintegrates.
As Table 1 shows, the geographic balance of economic advantage from prime
defense contracts has swung toward the north and east since 1963 and
On file Department of Commerce release
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Approved For Release 2005/04/21: CIA-RDP78T02095R000800020012-7
 Approved For Release 2005/04/21 : CIA-RDP78TO2095R000800020012-7
Table IL . Geographic Distribution of US I?ilitaay Pr.:i o Contract At-Ta r , 19621966
FY1962 F'Y1963 F CL961. FY1965 Fn966
Grand Total - Dill? oils -
of US Dollars 25,039 25,233 24,417 23,268 31,713
"Traditionally
Industrial Areas.-.
-
East and la&rest
51.6
49.8
50.7
"Ideir" Industrial
Areas: South and
Far I-Test
48.4
50.2
49.3.
Total
.100.0
100.0
100.0
51.2 _56.1
48.8 43.9
100.0 100.0
1. Data cover all prin_e contract awards of ?10,000 or pore.
2. Geographic coverage, by states, is as follotrs:
"Traditional" Areas: Connecticut, Delaware, Dist. of Coltc._bia, .Illinois, Indiana, Iotra, Kansas, I? aine,
I1aryland, INiassachusetts, Michigan, Minnesota, Missouri, I?ebrasda, I?ew Har pshire,
New Jersey, i;eu York,' North Dakota, Olxio, Pennsylvannia, Rhode Islz.nd, South Dakota,
Vernont, and Wisconsin. - "
1111ew Areas"..... Alabar:a, Alaska, Arizona, Arkansas, California, C41ora.do, Florida, Georgia, Tawaii,
Idaho, Kentucky, Louisiana, i `i ssi ssip_~i, Montana, ldevada, Neu Mexico, North Clislu :cnt grow i^apidly. In Barly 1965, the Arr,:ed Forces strc gth
ranged between 2.6 million and 2.7 ruillir n, and the United States had
about 25,000 r:en in Vietnam. By the end of 1965, the total had increased
to 2.9 ,-,dllion and by yearend 1966 to about 3.4 million, with close
to 400,000 in Viotnari. Civilian orxploynont in the Defense Dopartnent
.increased noro than 150,000 during 1966.
. . . the, increased size of the Armed Farces is still bclotr
the Korean War peak of 3.7 rxtllion reached in the Spring of 1952.
The Korean Tar buildup, starting froi. a much lower nanpozrer base
than in 1965, exccodgd 2 nti pion in loss than two years. Subsequently,
to yal military strength edged doicsw'ard although the war continued
until rii.d-1953?
The remaining three-fifths of last year's defense increase
reflected the higher -operating and maintenance costs associated with
the war and the rapid r.anpower buildup; these included outlays for
tex-tiles, equipage, fuel, and many other typos of soft goods and
services. Deliveries of artraunition and major hard goods wore also
hither. The advance in purchases of hard goods was particularly-
strong in the second half of last year, especially for aircraft,,
ordnance, and tactical raissiles.
G/WE
Approved For Release 2005/04/21 : CIA-RDP78TO2095R000800020012-7