How the Pentagon Works

“The expanding universe” that is the United States defense establishment consumed nearly $60 billion last year, more than half the national budget (and the President has asked for additional funds this year), commands the services of some 4 million persons, sustains a high proportion of American industry, and maintains an arsenal that could demolish the planet. Only a major revolution in management and planning techniques could produce the mixture of efficiency and control that makes the system servant rather than master of the republic. From the standpoint of a participant in that revolution, Mr. Yarmolinsky explains the techniques and tools by which the civilian controls and directs the power of the Pentagon. He was a Special Assistant to Secretary of Defense McNamara and later a deputy Assistant Secretary of Defense for International Security Affairs. A graduate of Harvard College and Yale Law School, he is now a professor of law at Harvard and a member of the Kennedy Institute of Politics.

by Adam Yarmolinsky

THE days when a new appointee arrives in Washington for almost any administrative job, one of the items high on his list of things to do, just after calling on the chairmen of his congressional committees, is to find a friend in the Pentagon who can give him a few helpful hints on how to make his organization work for him instead of against him. The word has got out that the politically responsible management of the Pentagon — the noncareer civilians clustered at the apex of the pyramid of power — has somehow mastered the secret of making the military and the civilian bureaucracies genuinely responsive to policy guidance.

There is some myth in this claim, but also more than enough truth in it to justify careful analysis, for what can be learned about today’s Pentagon, and for what the other big bureaucracies might learn from the revolution that has swept the Department of Defense in the short space of six years.

Not so long ago, a Secretary of War who asked to see the war plans was rebuffed by the generals. That was still pretty much the way it worked through December of 1960. In any real crisis of decision, the military bureaucrats could point out that American lives and national security were at stake, and that they alone had the experience of exercising responsibility for leading men into battle. In fact, the bureaucrats and the politicians had worked out a kind of rough division of power: the politicians decided how much money the country could afford to spend on national defense without bringing on a hair-curling depression, and the bureaucrats decided how the money would be spent, primarily on the basis of bargaining among the military chiefs of the four services. That this apportionment of funds sometimes had more to do with the relative needs and ambitions of the military services than with the requirements of United States foreign policy was an unhappy but unavoidable consequence of this way of doing business.

Toward the end of the fifties, the astute observer should have noted some changes, however, beneath the smooth surface of traditional relationships. The 1958 amendments to the National Security Act recognized, at least on paper, that U.S. military operations could not be handled separately by the Army, Navy, and Air Force, and provided for operational commanders reporting directly to the Secretary of Defense. The amendments also recognized that new weapons systems costing billions of dollars and involving years of development had to be planned for across service lines, and it established a Director of Defense Research and Engineering, with direct authority over the service bureaucracies. And the much underrated last Eisenhower Secretary of Defense, Tom Gates, began to establish meaningful communication with the Joint Chiefs of Staff, through weekly meetings in the Chiefs’ big bare conference room.

The fact that Gates chose to meet the Chiefs on their own ground, passing through a guard post where ordinary Pentagon civilian ID cards have no currency, was not lost on his hosts. His successor still follows the custom, demonstrating that the first principle of effective relations between political leaders and professionals, whether military or civil servants, is mutual respect. If bureaucrats are ignored, they will in turn ignore their masters, and go about conducting the business of government as they see fit. If they are lectured at, many will interpret the lectures according to their lights, and respond with what they believe their masters wish to hear. But if they are engaged in dialogue, they will, sooner or later, enter into the dialogue with honesty and vigor, and changes of attitude that cannot be accomplished by direction will be accomplished by persuasion. Besides, their masters may learn something too in the process.

There is an enduring paradox in the relationship: a large organization — large enough to have a bureaucracy — is controlled through the budget and the promotion list. But a vigorous, healthy bureaucracy largely controls its own promotion list, except at the very top, and it also controls the flow of information on which budgeting depends. With an ineffective bureaucracy, leadership cannot function; with an effective one, leadership is confronted with a significant countervailing power source.

A parenthesis may be in order here, only to indicate that the word “bureaucrat” is not used in any bad sense. Bureaucrats make government work, as they make any organization work. The best of them are dedicated to their organizations, and, in government, make lifetime sacrifices beside which the sacrifices of the political appointee look very small. But because their job is to keep the machinery of government operating, they have a natural resistance to any change that breaks the rhythm of their operations. And because they are dedicated to their own institutions, it is more difficult for them to sense needs beyond those institutions, or even to be aware of conflicts between limited and larger goals. In the language of the systems analyst, they have a strong tendency to suboptimize. And what is good for the horse cavalry isn’t always good for the Army — or for the country.

Any real change in relationships, whether between husbands and wives or between Defense Secretaries and generals, depends on effective communication. But communication is not enough; there have to be fundamental reasons for change, and at the beginning of this decade two fundamental reasons for change had developed:

• The refinement of the new analytical management tools of functional budgeting and systems analysis enabled the management of the largest organization in the world to relate the flow of dollars for megabucks) to the accomplishment of overall policy objectives and to weigh more rationally alternate ways of doing things.

• The emergence of an effective Soviet nuclear deterrent, able to survive a major attack with enough power to inflict tens of millions of fatalities on an attacker, made it finally and irrevocably clear that there could be no victory in a general nuclear war, and cast the shadow of nuclear Armageddon over every international conflict involving the use of force.

The first reason for change made it possible for the dialogue between the political leadership and the bureaucracy to be based on agreed facts about what military resources were available for particular tasks, and what were the effects and costs of adding new resources. These facts were made available without regard to which military service provided the existing resource or proposed to develop the new one, and they could be presented in intelligible form, projected over a period of years.

The second reason for change made it essential for the political leadership of the country to consider the implications of any military move, no matter how minor. If war had already become too important to leave to the generals, the selection and deployment of weapons and forces to deter war were now at least equally important.

The need for more active political management could not have been met if the tools had not been available, and the tools might not have been picked up without the need to find and use them.

THE most immediate need in January, 1961, was to assure the ability of the United States strategic nuclear force to survive the heaviest attack that could be launched against it with sufficient remaining power to inflict unacceptable damage on the attacker. To this end, the proportion of B-52 bombers on fifteen-minute ground alert was increased to 50 percent; the production of Polaris missilecarrying submarines was speeded up; and in landbased missiles, production emphasis was put on the Minuteman, dispersed across the wheat fields of the northern plains in underground concrete silos. The communications links from the air bases and submarines and missile controls all the way to the Commander in Chief got special attention, so that in an emergency he would be in effective command.

At the same time, the Secretary of Defense was pointing out the limitations of the nuclear deterrent: no nation could be expected to invoke the actual use of nuclear force and consequent mutual destruction except in defense of its most vital interests, and therefore no aggressor could be deterred from posing a lesser danger by its victim’s bluffing about nuclear retaliation.

Below the threshold of nuclear deterrence, the United States faced the second immediate need, to make its non-nuclear forces better able to respond to small crises before they grew into big ones. In January, 1961, the U.S. military establishment was able to deal with only one significant situation of violence in the world. By the time of the Cuban missile crisis, in October, 1962, the United States was able to assemble in a few days the men and weapons to remove the missiles by force if necessary, and without stripping other defenses. And the United States Navy was able to conduct a naval quarantine under the most dangerous and delicate circumstances, in which every move of every ship was debated not only in the Pentagon but in the State Department and the White House.

These ready, flexible, responsive forces were built up to meet the need for quick, precise military response in circumstances largely unpredictable because the range of situations was so broad and the probabilities of action in any given situation so small. The number of combat-ready Army divisions was increased from eleven to sixteen, without significantly increasing Army manpower. Two new airplanes were developed to carry enormous payloads of men and materiel over intercontinental distances at jet speeds. Light planes and helicopters were adapted to move men into battle by air.

None of these changes could have been made without the new management tools and techniques. The military establishment offers a unique field for their application. It is not just the biggest organization in the world; it is bigger by several orders of magnitude (Pentagonese for several times ten) than any other government department. In fact, it is bigger than all the other government departments put together. Where other departments measure their resources in thousands of men and millions of dollars, the Pentagon measures in millions of men and billions of dollars. The annual recurring savings from the McNamara cost reduction program alone are greater than the combined annual spending of the Interior and Post Office Departments and the civil functions of the Corps of Engineers.

All this means that the effects of improvements in management techniques are readily visible, that the costs are easily absorbed, and conversely, that without such new techniques it would be hopeless for anyone to attempt to make rational decisions on Defense-wide issues.

One of the most important new management tools was the way of looking at the numbers in the Pentagon ledgers that is called functional budgeting. In the bad old days, the Department of Defense budget was sent to the Congress broken down by military department and then into “pay and allowances” and “operations and maintenance” for each of the various units within each service. The cost of purchasing each kind of major weapon and other items of equipment appeared separately, weapon by weapon, but not the enormous cost of developing the weapon, or the cost of the pay and allowances of the men who make it work.

The Defense budget still goes up to the Congress in this form, but it goes up in another form as well, which is a good deal more enlightening to the lawmakers and a good deal more useful to the managers in the Executive branch. In this new form — new since 1961 — it is broken down into nine major program packages: Strategic Retaliatory Forces, Continental Air Defense Forces, General Purpose Forces, Air and Sea Lift, and so forth. Each program package contains all the costs of all the forces that contribute to the particular function from each of the military departments, including the cost of developing, procuring, maintaining, operating, and improving ail of the weapons and equipment involved. These costs are projected at least five years ahead, and every year the five-year projection is revised and a new year added.

The Strategic Retaliatory Forces package contains the costs of the bombers and missiles of the Air Force’s Strategic Air Command, of the Navy’s Polaris submarine fleet, and of the communications needed to control them. The General Purpose Forces package contains the costs of the Army and Marine Corps combat divisions, most of the Navy, and the Air Force tactical air units. And the Research and Development package contains all the costs of new weapons in the process of development, and not yet assigned to an operating package.

Within the framework of the five-year program, it is possible to calculate all the costs of alternative ways of satisfying military requirements. Does the Strategic Air Command need a weapon to knock out missile defenses against its bombers? Analysis can compare the relative costs of developing, building, operating, and maintaining a missile fired from the bomber itself, with the same costs for a variety of ground-based missiles, and it can see which will cost the least to achieve the required effectiveness. It was on the basis of this kind of analysis that the Skybolt missile program was abandoned. Missiles already in the inventory could do the same job at less cost.

Does the Navy believe that its future is in nuclear power, and that the future begins right now? Analysis can examine the costs of building and operating a nuclear carrier, and of the supporting vessels that must be nuclear-powered too, in order to take advantage of the carrier’s nuclear propulsion; it can determine how much more of the cheaper conventionally powered force it can buy with the same amount of money, and then compare the relative effectiveness of the two forces, checking, for example, how far and fast a carrier must steam to meet particular crises, and the point at which the fuel requirements of the carrier’s planes are the limiting factor on its mobility. The results of this analysis will determine in large part how rapidly the nuclear Navy comes into being.

One of the possibilities that functional budgeting and the resulting analysis unearth is the combination of several new military requirements, often from different services, into a single set of specifications for a new weapons system. The combined specifications will necessarily embody some compromises. But rational compromise is the way to get the most for one’s money, no matter how much money one has to spend.

It is a common fallacy that if (as President Kennedy established) we can afford to spend as much as we need to defend ourselves, we should buy every military improvement, no matter what it costs. Some requirements are critical; others are only desirable. A fighter plane needs to be able to fly fast enough and high enough to outperform its antagonist. It would help to be able to fly still faster and higher. But for the cost of the extra speed and altitude it may be possible to buy two planes for the antagonist’s one. And that difference may be more critical.

The proof that combination and compromise can work is the airplane that went through bureaucratic and congressional fire as the TFX and emerged successfully as the P-111, the first major combat aircraft to be designed and built for more than one service — and that has now found purchasers among our allies as well.

THESE new techniques of analysis do not perform themselves. They have to be performed by people, and at some stage, if not in the first instance, the performance has to be reviewed by people who are somewhat removed from the operating agencies most directly affected by the outcome of the analysis. These people can be found clustered in and around the pie slice of the Pentagon on the third floor between the eighth and ninth corridors, sandwiched in by the Air Force on the floor above, the Joint Chiefs below, the Army and Navy on one side, and the Defense Intelligence Agency on the other.

McNamara has not significantly enlarged the 2000-man Office of the Secretary of Defense that he found on his arrival six years ago. But in the process of further rationalizing the organization of the Department, he has created a number of new agencies, like the Defense Intelligence Agency, which centered the operational intelligence functions in the Joint Chiefs, taking them away from the military departments, where they no longer belonged because the departments had long lost their operating responsibilities. Similarly, the Defense Supply Agency was created as the wholesaler of common supply items for the services, and the Defense Communications Agency took over the global military communications net.

What McNamara has done is to increase quite substantially the quality of his own staff while at the same time increasing their responsibilities. To what extent abler people sought more responsibility, and to what extent greater responsibility attracted abler people, are anybody’s guess. But the fact is that beginning on January 21, 1961, fundamental issues were raised and decided at a noticeably accelerated pace, difficult questions were posed, and quantitative answers, answers “with the numbers in them,” were demanded. And the source of all this was in the Office of the Secretary of Defense, prompted, of course, by the Secretary himself.

He began by setting up four task forces, staffed from within his office, on four most immediate and important issues: strategic and continental air defense forces, requirements for limited war situations, a review of all major research and development projects, and an examination of military bases with a view to possible reductions. On the basis largely of their reports, the first supplement to the fiscal 1962 budget was prepared. Within a few weeks, the Secretary had put together and issued his famous “99 Trombones,” a list of ninetynine special projects to be undertaken on top of all the regular work of the Department. Each project raised a question about how things were being done in a particular area, and how they could be done better. They ranged from fundamental questions of politico-military strategy to detailed technical questions of procurement. Some of the more notable products of the 99 Trombones, as it was rapidly expanded to an orchestra of several hundred instruments, were the Defense Intelligence Agency and the other new defense agencies mentioned earlier, the Air Mobile infantry division, and the overall revision of the military pay structure. Assignments were made not only to the dozen people who headed the various elements of the Office of the Secretary of Defense but also to the Secretaries of the Military Departments and the Joint Chiefs. Almost every study involved an exchange of views between people within the Secretary’s own office and people outside it, thereby encouraging the essential dialogue.

In all these activities, the key staff was probably the staff led by the Defense Department Comptroller, Assistant Secretary of Defense Charles J. Hitch, a short, quiet, dry economist whom McNamara had taken from the chairmanship of the RAND Corporation’s research council, largely on the strength of his book about functional budgeting for Defense. It was Hitch’s primary responsibility to put the system of functional budgeting into operation, and he did so a year ahead of the original schedule. His other major contribution was to organize a systems analysis group under Alain Enthoven, a tall, quiet, dry economist who later became Assistant Secretary of Defense in charge of systems analysis. Enthoven’s analysts prepare the basic memoranda that justify the changes in the five-year program and budget of the Department from year to year. They are constantly engaged in a highly technical dialogue with the bureaucracies, the military departments, and the Joint Chiefs.

Almost equally important is the staff of the Director of Defense Research and Engineering, the largest element of the Office of the Secretary of Defense. This staff developed its present strength under Harold Brown, a solid, judgmatical scientistadministrator, now Secretary of the Air Force, and two remarkable Renaissance men, John Rubel and Eugene Fubini, who served successively as his deputy. The scientists on the staff, many of whom are recruited from industry and the universities for two-year tours, supervise and review the whole spectrum of technical activity that shapes the weaponry and tactics of the military establishment ten years or more down the road. The director has statutory authority over all research and development commitments within the Department. But his effective authority again depends largely on the effectiveness of the dialogue between his staff and the staffs of the military departments.

Out of that dialogue have come a number of pungent observations, like Fubini’s definition — and rejection — of the American Syndrome: “If you can do it, do it!” The syndrome, he pointed out, has resulted in expenditures of hundreds of millions and even billions of dollars on projects which, if carried through, would have been triumphs of American technical ingenuity, but more in the style of Rube Goldberg than of Billy Mitchell or Hyman Rickover.

It was the teamwork of Systems Analysis and Research and Engineering that helped abort such overblown projects as the nuclear-powered airplane, and that encouraged projects like the TFX and the enormously effective super cargo and troop carrier, the C-5. But above all, it has spread the gospel that the proper question for the Defense planner to ask the scientist or the engineer is not What can you do?, because given enough time and money he can do almost anything. (“Give me enough power,” says an aeronautical engineer, “and I can make a kitchen table fly.”) The proper questions are rather: What are the alternative ways in which you can solve my problem, how effective are they, and what do they cost?

Just as it is a popular fallacy that Robert McNamara controls the Department of Defense simply by giving orders, so it is a sophisticated fallacy of old Washington hands that functional budgeting and the other analytical tools in the McNamara arsenal directly control the Defense bureaucracy. In fact, these tools are a necessary but by no means a sufficient condition of control; they are only the cards you need in order to get into the game. Essentially they serve to make meaningful communication possible about extremely complex questions between the politically responsible officials and the bureaucracy. Communication does not imply agreement, and a good many Pentagon bureaucrats, both military and civilian, find themselves in violent disagreement with their political masters.

But in the Department of Defense, the system works to the extent it does because the tools are available and the communication actually takes place, so that responsible decisions can be made on adequate information — or as adequate information as there is in the system. A good deal of the communication is between bureaucrats on both sides of the discussion. There are more in-andouters, people whose careers are not tied to a single institution, below the Assistant Secretary level in the Office of the Secretary of Defense than in the military departments or the Joint Staff. But most of the professionals in the Secretary’s Office, civilian as well as military, are probably career men. And when real communication takes place between bureaucrats across institutional lines, important issues are inevitably raised for decision at the top of the institutional structure. True, the bureaucrats in the Secretary’s Office must be satisfied that he is ready and willing to make decisions. And Robert McNamara personally makes literally hundreds of budget decisions every year as they come in to him on standard-format, tightly worded subjectissue sheets. It is an essential element of his management philosophy to reach out for decisions. But he could not find the factual background for decision making if the system did not dredge it up for him.

A case in point was the decision to choose General Dynamics over Boeing as the contractor for the TFX. In order to evaluate properly the cost estimates submitted by the two final bidders, both of which were unreasonably optimistic, the Secretary would have needed a compilation of experience statistics, based largely on so-called learning curves, which was simply not available at that early stage in his administration. Instead, he had to base his decision on his own business experience. The results so far have borne him out, but it was a painful process, and one to be avoided if possible in the future.

There are at least three kinds of decisions that face the policy maker as he goes through the piles of papers on his desk. The first are the either-or, ves-or-no decisions, where the choices are mutually exclusive. Then there are the now-or-later issues. And last there are the how-much or how-far decisions, where the question is one of degree.

All these decisions, if they are important enough to reach the men who sit in the status three-window offices on the E Ring, involve a balancing of values and risks. These are values and risks not only for the country, and often for the world, but also for interest groups within the Pentagon, across the Potomac, and down Pennsylvania Avenue to the Capitol. The pressures for some accommodation of these competing forces are enormous, and, in part because of the complexity of the issues, the opportunities for compromise are not inconsiderable. Even in the first kind of decision, there is room for accommodation. A yes on one issue may be balanced by a no on a related one. On the other hand, an unbroken series of “no” answers to any bureaucracy tends to inhibit communication altogether, rather like the labor relations concept of failure to bargain in good faith. No Secretary of Defense can regularly reject: proposals from his military advisers, particularly where both their professional competence and the lives of American boys are at issue; and no analytical arguments will modify the effect of a blanket rejection on the continuing workable relationship between the Secretary and the generals. Indeed, the remarkable thing is not how many compromise decisions are made in the Pentagon, in the face of all the pressures for compromise, but how few.

It is here, if anywhere, that the so-called militaryindustrial complex comes into play. When President Eisenhower, as he left office, warned of the growing power of the military-industrial complex, he may only have been giving vent to his frustrations at his inability to hold down the Defense budget. At the end of his term, he still thought a President ought to be able to give orders like a general, and when he found the orders were not directly obeyed, he chose to blame it on a conspiracy.

Surely the military-industrial-congressional complex is not a conspiracy. But there are coincidences of interest among the military project officer who is looking for a star, the civilian who sees an opening for a new branch chief, the defense contractor who is running out of work, the union business agents who can see layoffs coming, and the congressman who is concerned about campaign contributions from business and labor as well as about the prosperity of his district. Each of these constellations of interests wants to expand the Defense Establishment in its own direction. In the early sixties, the Pentagon was an expanding universe, one of the few fortuitous advantages McNamara enjoyed at the beginning of his tenure. Resources that were cut out of unnecessary activities could often find employment in areas that needed to be strengthened. A similar situation prevails today. Until very recently, Army training camps simply were not available for the training of less essential reserves mandated by a congressional lobby, because the training camps were fully utilized readying active forces for Vietnam. But when the war in Vietnam is brought to an end, the pressures of the military-industrial-congressional complex will necessarily be increased.

The pressures can still be resisted, and there is every evidence that they will be. But it is unreasonable to expect any Secretary of Defense to resist them alone, or supported only by the few people within the Department who are entirely his own men. Over the past six years, the Pentagon has developed the kind of organizational and analytical instruments that permit effective communication between the bureaucracy and the responsible political leadership, and among the elements of the bureaucracy with conflicting institutional interests. That communication has been taking place about fundamental changes that have been and are necessary to make the military establishment a better servant of United States foreign policy. It takes place at every level: not only does the Secretary talk to the Joint Chiefs, but GS-15’s in Systems Analysis talk to colonels on the Joint Staff. There is an effective apparatus to raise issues for decision, and when they are raised they are decided promptly, unless there are good and sufficient reasons for putting off decision.

Political administrators on the other side of the Potomac can learn from their friends in the Pentagon how to put their own houses in better order. Yet the Pentagon’s administrators themselves cannot determine the role of the Military Establishment in the United States, and should not be asked to. It took a national debate over a period of years to demonstrate that the Military Establishment was inadequate to its tasks and needed major structural reform. Those reforms have now given the United States more usable military power. The uses that we choose to make of the Military Establishment, and the limits that are put on its growth and employment, are a large enough subject again to engage the attention of the nation.