Foreign Relations of the United States, 1961–1963, Volume VIII, National Security Policy

121. Memorandum of Conference With President Kennedy⁰

Palm Beach, Florida, December 27, 1962, 10:45 a.m.

OTHERS PRESENT

• Secretary McNamara
• Deputy Secretary Gilpatric
• General Taylor
• General Wheeler
• Admiral Anderson
• General LeMay
• General Shoup
• General Clifton

Secretary McNamara and General Taylor stated that they had discussed the defense budget thoroughly with the Joint Chiefs and the Service Secretaries and had also given the President their views beforehand. They wanted the Joint Chiefs to do the talking at this meeting and they would comment as the discussion grew.

Admiral Anderson summarized the Navy viewpoint and included the comment that for the Joint Chiefs it was a difficult period of transition in two respects; first, the technological advances in weaponry were tremendous; and, second, they had to recognize that we were approaching a point where both sides hold a Sword of Damocles (in the nuclear sense) over the Soviet and the free world heads which could inhibit the use of nuclear weapons against each other’s homeland while fairly large-scale war with conventional forces—including war at sea—might take place.

Although this is the 1964 budget, Admiral Anderson pointed out, it really forecasts in many respects what the 1968-70 capabilities would be. Consequently, it has long-range connotations. For the Navy, he found two major difficulties for Fiscal 1964: personnel is too limited to be really adequate, and the funds for operations, spare parts and maintenance were less than required. In spite of this, however, they were going to do the job and meet commitments. To meet one of these problems, he hoped to reduce the tempo of operations wherever possible. He pleaded that in these areas, the Navy be given more control over the decisions about their operations and about the handling of their personnel. He pointed out that new ships take more people than old ships take in the era of technological change, and that the Navy actually needed 685,000 people, which would be an increase of 20,000. Instead, they have an allowance of 670,000. So they will be undermanned in some areas. In some cases they would have to man standby ships with 20% crew strength and either transfer some ships to the reserves or call up reserves in case of an emergency. The personnel hurts especially in the short-term area.

For the long-term, the Navy’s greatest concern is the adequacy of the shipbuilding program to replace old ships. From the Navy’s request, their shipbuilding program was reduced by a half-dozen ships. The program is well balanced but it leaves the Navy with the knowledge that in 1970 there will be a greater percentage of over-age ships than should be in the fleet. As an example, the Navy asked for eight nuclear attack submarines and the number was reduced to six. The lead time on a submarine is 40-plus months. Aircraft procurement is less than needed—for example, the Navy asked for 180 F-4-Hs and it was reduced to 132.

In research and development, Admiral Anderson was convinced the Navy could use more money; at the same time he pledged that the Navy could and would use the money they have in the best way possible to meet its requirements. He reiterated his pleas for more Navy authority, with more attention being paid to professional judgment in all of the fields he mentioned.

The President asked about the progress on surface-to-surface missiles.

Admiral Anderson reported much progress in adapting surface-to-air missiles to the surface-to-surface role, but they hadn’t fully licked the problem. Work in this area continues.

The President asked about Soviet ships carrying surface-to-surface missiles and Admiral Anderson confirmed his statement and said that primary reliance for countering them at the present time is attack by naval aircraft.

The President asked, in relation to the missiles in Cuba, about the 30-40 mile range missiles that are on shore which would keep the fleet way out. Admiral Anderson answered that they would have to knock those out by either carrier- or land-based air before making a landing in their vicinity.

In the field of antisubmarine warfare, Admiral Anderson stated that there was no magic breakthrough in sight, and that current developments are incremental in continuing improvements over past capabilities. He said that they would keep working on the problem but that we should have no illusions as to its magnitude even though we had considerable success in the Cuban operations over Soviet conventionally powered submarines. He also pointed out the important contributions on the part of our allies, indicating his apprehension that the British interest in achieving an independent nuclear capability might result in a decrease of British naval capabilities in ASW and meeting worldwide commitments.

General Wheeler stated that the 1964 budget was most satisfactory from the Army point of view and that, as Mr. McNamara had pointed out in a general purpose forces paper,¹ the Army would be in the best shape it has been since Korea. There are $3.3 billions of PEMA funds, of which $3.2 billion is in new obligational authority. This would give the Army sufficient funds to procure the initial complement of combat equipment required for the 16 active and 6 priority reserve divisions plus such replacements, spares and combat consumables as are necessary to permit 16 divisions to operate in combat for the period between D-Day and the time when the production resources of the country can furnish equipment at a rate equal to combat consumption.

General Wheeler pointed out that the two greatest problems were personnel and Nike-Zeus. He spoke at some length about the Army personnel situation with a 960,000 ceiling. Of this number, 406,000 people are devoted to other than direct divisional activity. Of the remaining 554,000, there are 70,000 in Alaska, the Caribbean area, and Berlin which had to be there but which would not really be counted on for combat capabilities outside of those areas. This leaves the Army with a “division slice” of about 36,000 for a division and its combat support elements. The Army asked for more people, especially for artillery battalions, signal units, etc. The result of this 960,000 ceiling would be that the Army would have to depend on the reserves earlier in a war than they would really like to. Meanwhile, General Wheeler is going over the Army layer by layer to cut functions and to cut people, and he feels that the greatest savings can only be made by cutting functions.

In regard to Nike-Zeus, there was a rather lengthy discussion with the President, Secretary McNamara, General Taylor and General Wheeler, in which they analyzed the results of a missile defense and discussed the Soviet capabilities. The President made the point that at the present reading there is a $9 billion deficit in the government budget for FY 1964. He said that it would just be too expensive to buy the proportionate share of $19 billion spread over ten years for Nike-Zeus at this stage.

The President questioned our forces in Europe and the advisability of trying to maintain the equivalent of a six-division force with a logistic base enabling it to fight for 60-90 days when the NATO allies were not building the conventional forces to make a 90-day conventional warfare a possibility. The French have a 5-10 day supply basis, the Germans hopefully would have 90 days in the near future, and in substance NATO would only have 18 divisions, plus or minus a few spare parts which could be put on a 90-day basis, unless the allies improve their effort.

General Wheeler stated, and it was the consensus, that our only realistic approach was to get the allies to move forward on the conventional force program.

In a discussion of the need for the equivalent of six divisions, as opposed to a lesser number, General Wheeler pointed out the fact that our air bases are forward in Germany and must be protected until they can be effective in carrying out their part of the mission, even if we opt for a shorter period (10 days) from D-Day to the use of nuclear weapons. This led the President to question the advisability of the U.S. keeping a total of 257,000 people there to support six divisions on a 60- to 90-day basis, if future strategy dictates our earlier resort to nuclear warfare.

The President said that U.S. forces in Europe would have to be “thinned out” unless NATO allies improved their readiness and supported the forward strategy. He said that he expects Secretary McNamara and the Joint Chiefs to make a judgment during 1963 about whether this effort with our allies is going to be successful or unsuccessful. As a corollary, he said that he felt that a judgment would also have to be made on whether we, along with our allies, can ever fight a conventional war for 60-90 days in Europe, and if we decide that a non-nuclear war for that long is not a real possibility, then we should certainly examine the level of supply that we now plan as essential. This corollary judgment would be especially applicable if our allies don’t come through with the necessary cooperation to make conventional warfare a possibility.

Admiral Anderson remarked that some of our allies would never make a realistic contribution comparable to that of the United States until they were again genuinely afraid of the threat to their homelands.

The President reiterated what Prime Minister Macmillan told him about President de Gaulle’s attitude² and the question that it raised; how much in depth must we keep in Europe as we are faced with a decision to draw back and resort to nuclear warfare? Throughout the President’s discussion there was emphasis on the gold outflow which must be reduced.

General LeMay said that we might force the Europeans to do more by actually pulling out some of the ground forces.

General Taylor pointed out that Spain might be brought into NATO to assist in this conventional buildup, and General LeMay praised the agreement that we have with the Spanish. The President countered this, stating that the attitude of the Spanish in cashing every dollar they earn for gold and hurting us by this method hardly encourages the advisability of doing much more with Spain. He pointed out that our gold reserve now stands at $15.75 billion, and that there is a $12 billion floor on this gold cache, leaving us a $3.75 billion cushion, which is being eaten up at the rate of $2.5 billion a year. He stated that unless we stop the gold outflow in a hurry we will have reached the floor, and by 1964 we will have to have some new decisions.

The President questioned also the 30% of infrastructure for NATO that we pay. Secretary McNamara pointed out that infrastructure would soon be up for renegotiation. There was mention of a flat statement to NATO that 20% is going to be our new percentage, take it or leave it. The President mentioned that the U.S. is spending a larger percentage of its gross national product on defense than any of our allies, and that we have a larger proportion of men in the armed forces compared to the number of people in our country than any of the other allies. Secretary McNamara said that we would probably just have to pull 50,000 to 70,000 people out in order to reduce the gold costs, and promised that he would submit a plan for the withdrawal of 50,000 to 70,000 men from Europe.

All agreed that we must concentrate on the NATO area in the next few months to see if NATO couldn’t solve this problem.

In regard to Nike-Zeus, the President asked if the Army could assure production and deployment on a schedule to be effective in 1967. There followed a lengthy discussion, with General Wheeler leading, on the two-stage deployment problem and the difference in costs between the Army’s $19 billion idea and the Department of Defense $16.2 billion idea. In Fiscal 1964 the difference in investment costs would be only $270 million. Secretary McNamara pointed out that we already have $370 million in Nike-Zeus research and development and an additional $100 million for research and development in allied fields which helps Nike-Zeus. This he felt was all that could be afforded. There followed a discussion about whether or not we would ever use Nike-Zeus, the factors involving a Soviet decision to attack either our hard missile sites or our cities, and the number of people that a $19 billion program might save.

The President then turned to General LeMay who opened with a statement that in his five years of budget planning this had been the best with the greatest amount of agreement among the Chiefs and the best feeling of support from their civilian superiors, including the President, that the Joint Chiefs had ever had.

Concerning his misgivings, he feels that the Air Force assault forces are too small, specifically needing four more squadrons of C-130s to meet requirements. This would mean fifteen planes per squadron at $2.5 million each. As far as aircraft replacement is concerned, General LeMay felt that we are “putting off the day” and we are eventually building up trouble for ourselves. General LeMay mentioned the reserve callup and the efficiency of the reserve forces and their reaction to the Cuban situation.

Changing the subject to tactical fighters, he stated that we are now overcommitted and that our modernization is too slow. The Air Force had asked for a second source for the F-4-C, which had been turned down, in spite of the fact that the increase in fighter production from twelve to fifteen a month is still all going to the Navy until Fiscal 1964.

In regard to air defense, General LeMay pointed out that there was not much in the budget for it, and that the F-106 is the newest fighter-interceptor and even that aircraft is out of production; therefore, we should seek a replacement. He stated that the Air Force had asked for a Mach-3, 1200-mile range fighter, with improved radar, a project which had been turned down. He pointed out that the Soviet Union was equipping its bomber force with air-to-ground missiles which could be launched at greater range from our targets and that this new fighter was an essential, in his option.

He also mentioned that as far as the military aspects of space are concerned, we are not going fast enough.

General LeMay emphasized that his biggest worry is in the strategic field and that the trend is bad. He felt that the trend is toward an all-missile force, and he has two or three objections; first, with an all-missile force we were simplifying the Russian program; secondly, we were moving away from the flexibility that we now have in our strategic forces; and third, intelligence estimates indicate that more flexibility is needed, not less. He stated that he had given all these arguments to the Secretary and had been properly heard, but his misgivings were still strong.

The President then questioned the group in regard to the number of Minutemen, Polaris and Titan missiles, and opened a discussion on the Soviet missile capability. All this was discussed at some length and General LeMay pointed out again that our main objective was not to match missile for missile but to deter any war from starting. The basic question to answer is: what will deter the Soviet Union? His own answer was that the flexibility of the mixed force was much more potent in deterrence—especially in deterring the conventional war—than an all-missile force.

The President pointed out that he had two concerns about this budget: transport, both sea and air, and communications.

There was some discussion about the lead time on the C-130. The Chiefs felt that it is roughly eighteen months, but Secretary McNamara believes that it is more like 9-12 months lead time.

General Shoup was asked to comment and he stated that the Marine Corps would spend 2% of the defense budget, and so far as he was concerned, when materials to be procured with 1964 funds are on hand, the Marines were the best they had ever been in peacetime. Their personnel has a small problem as the enlistments ebbed and flowed, but this could be overcome. Further, the Marine Corps reserves were in better shape than they had ever been in and could make a real contribution. General LeMay gave the President one quote: “War is not efficient,” and consequently, its needs and its plans couldn’t be run by computer efficiency measurements.

In summarizing, the President pointed out that this Administration had put more money in defense in the past two years than any other previous Administration. He pointed out that we have almost had war in Laos, we had almost had war in Cuba, and we had had an ultimatum in Berlin. We have also been engaged in Soviet Viet-Nam almost constantly for twenty-two months. It was quite apparent to him that more dollars were needed rather than less. He also stated that in the foreseeable future we would have at least as many troubles, and that in Latin America we could anticipate even more problems than we had faced so far. He stated that we had gone from $44 billion up to $49 billion and that we are now at $52 billion, making a more intensive effort in free world defense than had ever been planned.

The President said that he is very interested in what we do in this field and he wants to be sure that we are doing enough. He charged the Joint Chiefs to be constantly mindful of this. He also pointed out that they had to be mindful—although it was not their primary concern—that he was facing a budget with a $9 billion deficit and that this had to enter into the Chiefs’ consideration as they surveyed the needs to make sure that we are doing enough.

The President directed that the Chiefs review the transport problem, both sea and air, with Secretary McNamara and give him a report before they lock up this 1964 budget. Admiral Anderson commented that they should immediately put some LSTs on the list and that it would call for a small addition to the Navy budget, but he could get them out of moth balls and man them with a bare minimum of caretaker crews and have them ready to haul the heavy weapons in case we are faced with the possibility of another Cuban situation.

The President also directed that they look once more at the fighter aircraft situation and give him a report on that.

The President pointed out to the Joint Chiefs and Secretary McNamara that although we feel that the present Cuban situation is dormant, we must assume that someday we may have to go into Cuba, and when it happens, we must be prepared to do it as quickly as possible, with a minimum of destruction. Therefore, they must provide for this contingency as they look into one, two, three, or four years ahead.

The President pointed out that he felt this was a possibility in the next few years whether he was President or not, and that they had to plan for this.

Discussion of Cuba followed which included a statement by the President that in any planning we must make sure that our “political work” is well done. If there are defections to our side we must be ready to handle them and exploit them.

The discussion which followed involved the “civil affairs and military government” planning, as well as the special forces planning, in connection with Cuba.

The President then discussed the Cuban Brigade, and the training of Cubans that is now taking place.

An additional note on the budget was raised by Admiral Anderson. He pointed out that our military construction was going to be a problem that would not go away. Even though we are holding it to a minimum at the present, eventually all the Services would need some new facilities.

In summary, the President asked that they look over the situation in Europe, that they review the transport situation, that they maintain their present efforts on communications, and that they search for even other occasions to prevent the balance of payments from getting out of control.

As to Nike-Zeus, the President stated that it was his decision to stay with the budget as it is now proposed.

Finally, the President said that it would almost seem that Europe is getting a “free-ride” and that on both the political and defense side, this situation with our NATO allies had to be changed this year.

General Taylor presented a Joint Chiefs of Staff proposal on testimony before Congressional committees which was approved (copy attached).³

Secretary McNamara indicated that only he, Secretary Gilpatric, and the Chiefs would reveal any Joint Chiefs of Staff decisions or positions as per the memorandum.⁵

C. V. Clifton

⁶

0. Source: Kennedy Library, National Security Files, Chester V. Clifton Series, JCS/Kennedy 12/62-1/63. Top Secret. Drafted by Clifton on January 10, 1963. A memorandum for the record by Clifton of the same date is attached to the source text. In the same file are several copies of a draft memorandum of the conference prepared by Clifton on January 2, which bear detailed corrections made by each of the Joint Chiefs. Most of these changes are incorporated in the memorandum printed here. McNamara wrote on his copy of the draft that “the ‘minutes’ are not quite in accord with my recollection of the discussion but I see nothing so important as to require change.” A copy of McNamara’s handwritten notes of the conference are in the Washington National Records Center, RG 330, OSD McNamara Files: FRC 71 A 3470, Palm Beach Notes on JCS Views. Kennedy’s Appointment Book indicates that the President met with the Chiefs only from 10:15 to 10:40 a.m. (Kennedy Library) No record of this conference has been found.
1. Document 115.
2. Not further identified.
3. Not printed.
5. Following this meeting, the President met with McNamara and Gilpatric and decided that no further changes would be made at that time in the sealift and tactical aircraft programs as then reflected in the Department of Defense budget submission for FY 1964 and that 72 additional C-130E transport aircraft would be proposed for funding in FY 1964. (Memorandum for the record by Gilpatric, January 2, 1963; Kennedy Library, National Security Files, Chester V. Clifton Series, JCS/Kennedy 12/62-1/63)
6. Printed from a copy that bears this typed signature.