SOVIET DEFE..-sE Mr. R. Helms' Briefing otes 28 :-rovenLber 1967 DCI BRIEE'I-'G FOR THE NATIO-~AL SECURirry COU~CIL SOVIET D:S~ENSE SPELZDING A.:.-;D EC0110:vIIC POLICY I. The military and economic analysts at CIA \·1.. :0 deal with Soviet military and space expenditures face two major problems. A. First, because the Soviets conceal a good share of their total military spendins 1 ou~ analysts must match the explicitly announced Soviet figures against all the evidence we i ( have>\ on all known mili~ary and S?ace programs, \\ .. ', .......... working out the actual costs in detail. In this way, we arrive at our own ruble figure for total Soviet exo2nditures--announced and/ ~~r • concealed. B. Second, in order to permit meaningful co~­parisons by our own standards, the analysts calculate what the Soviet programs would cost in dollars in the United States. This is of the unrealistic official necessa=v be cause --------·---·-----­exchange rate, and because of the inhere::1t ---· -· •· differences in the two econonies. -1­ S·.~·~·a··:-·"'-· ('. ·r c [" ".r:,_ .,.. ,..I""\ F,~ .,. ·, --­ • i • • , c' . >. • . .l c 1 ~1 i :::, c "' c f""" !""• c(~· ~1,..1\A ........ 1f1.. / i Corrrnand anc{ G-encrc~ UO[. O ... '· 28.2 1 4. 83.C> r:J •. 7 ,,., -· '·The figures on Sovie/ spcnclinu show Ilic rj('nc1 of :.izv of \ 'CJ/ ious p1 091 J/llS it 1ms of v/1 ii lh y wolll I cos/ in 111 US . • ..._....;... (TABLE_, U.S. vs. SOVIET MILITARY Al'!D SPACE SPEllDiilG,, 198?j II. By these methods, they have deterQined that So­viet military and space spending in Calendar 1967 totaled 20.4 billion rubles--the highest f ic.rure ..; since World War II. A.. The dollar equivalent wor:..;:s ot:t to 2J.~out 56 billion dollars. B. In other words, the Soviets, with an eco~o~y ------......----~-...··-··....,,.-· _ ... -----·-4-·• ·• ___ ......___... --....-..--·· ~ , 1 ~ t' . ,... ~ . 1ess than na r ne size or ours, are spencing --------..-.,1<.oo.--.-........... .__,...,..1,4 ,'1.,...... ··--"" .. ~.... ~-·~' '>.1---...... ~-.... -·-~--~.. ,---... ~~..~ ---...--..,,, .... .. ... rouqhlv as much_ for de~ense and soace as we ~ __________ .,...__·-.-....--...:......... .... . ---.... -~......._,. .. ------··· ......... I# ......,,••-~...-·-A-~.,,,..-,.-4-::.~...... \..-~~ are, excluding the costs of Vietnam. c. For the past five years, the Soviet defense and space effort, in dollar terms, has aver­ ·-.. ag·ed 85 percent of what we have been spe:'"lding on the same progr~ns. This chart compares the dollar cost of U.S. and Soviet .progrc.ms for 1967. D. The Soviet Union at this juncture is almost matching us in funds devo~ed to space and what we call R,D,T and E--research, develop­ .ment)testing dan ., .i...'eva~ua~ion. ,. E. The Soviets are ~·sDencing""' ~o .i... ~.o~e~ percen~ •.1 _ ---­.. -.. - than we are for strategic offense--$6.3 billion --· I 0 I.. ,. '6! , r ,, . ., l , . A. In addition, there 1"lJ.. na -.,..., -n,.-..··-~""S"' .~ - '-C..1. • ..L -'--'~ ·u. c::: of. almost 11 percsnt in tte budget for sci2~c~-­\\1hich p~obably covers the b'Ul:-of resec.rc:--1 B. As t1is chart shows, total Soviet sDendina - ~ for the military establishrnent, th2 nuclea:::­program, , and space runs conside:::-2bly higher I . each year than the explicitly a~nou~c2d We es~~l~~~a ~o~-1 19or8 L.ct budg·et figures. ~~ '--·•'-'-1.-C L. -.s"82nC.­. ·11 t' ' 1 . 2.., .t.. "3, · 1 1· ing wi _ a~oun ~o at _east ~ L.O L 0i~ ion • .t.., rubles, . or, in dollar equivalents, in 1.-ne •• ·.i-.c ""',...O b.:11· n VlClnl'-Y 0.L -?O _:.. __ io... SO lIET IN VESTMENT I ll __.I IV. Ke believe that no single program is likely to get the lion's share of the announced increasev . t . .t..' • ' The larg-est inves ment ._nis year wen~ .::or de­ ployment of ICBMs aimed at the United s~ates: ... --... i. I i the eouivalent of 3.5 o~ l 1.9 billion rubles, ... l l billion dollars. \ 1. We expect this to drop off in 1968 as Present deolov~ent procrra~s aoDroac~ co~­ -.... .,.I -­ pletion--but an .ex?anded progra~, or a start -· -,,. on qualitative improveLlents, could t~~e uo ,., ? b. 1 J . .,...ui.--."1 -s o.c i'nr-·.-o;:::se--·'"'"Y' -l-h:::> to a i_ .ion ~ ·.J.:..C .;,_ t-.:.J.t:; --"""'~'-""""" "'-'-:'.?­ billion. -4­ J_, • , B. You c~n see th-:t inves tr.:ent L-~1e OL.!1er ma-1 o·r _, ­progr~ms used rela~ively small . , s~12res of L.:J.e total 1967 b~dcret: ;;; m' ", S \"C: ·'-er.1--r'"1 c:J::. .,,...,... 1. ine i..'iOSCOW _!.._,I.- ·•L -C. LC.~.:::> I missiles: 100 ~illion rubles, or $165 . . 11 . mi __ ion. m' m 1 1. ­ 2. ine .La_ inn long-range surface-to-air mis­sile systew, about 200 sillion rubles, or / $410 million. 3. Interceptor aircraft systems, 300 million rubles,f· or $720 million at our prices. rubles, or $340 million. C. Our prediction, the~, is that the inc~eased Soviet rnilitar1 spending in 1968 will ~ot show up concentrated on ~µy single mission • I I' · 11 b ~ .or s rs -ce!7l.. i -c. wi _ e spreaa. over a num.0er ... ..--­· -... -­. ·-of prograns, and will add to over-&11 Soviet military stre ngth. V. The Sovie t milit~rv le~ders a99arently made their \ I ' case \·lith the Politburo, not by arguing· any o:'le . ~ ' .., b , , "" ,over-riaing ncca, u-c. 02cause ~~e political ar.d . .. economic climate was favorable to the~. -5­ A. , . ' The Kremlin .wants to take a posture of nign military readiness for the sake of its , ""\j;:'osed to increase sharply, but they have leveled 0 /::.::::: l...L I ., ana even declined in some ca.tegories. 1. The Russians in 1963 joked grimly abo~t "Khrushchev's mira.cle"--that he planted wheat in Kazakhstan and harvested it in Canada. 2. The new leaders had this . l' 1 . ' planned aaricu ~ura_ ;,; to 1970, but now tl:ey app2ar on continued good harvests. 3. At least one Politburo merr~2r 1 Premier Polyansky, has been of this renegi~g. He is . ,.. .L.. • and lI any~~ins goes wrong there will be considerable oo • in the Kremlin. -7­ . . ' , F . The Soviet man in the street lS . r ~ . ~ -.. ,-­ ~-­ i-1 ~ .,.... ..1.-..... ­ -..... "'-·---_,-~ -·-'.:,i · · for thi'=' .i ..,... .mo ..en~. r )· 1 . H.is cash income -;. .-. -•.J high , and he c2n ex­ ,... t, . pect. rur ncr increases betr..reen now a:;1d 19 70 . , Y"\ like refrigera~ors and televisic~ se~s .J... J.• tn' ','.'.:\ s .L. _._. L.O!.:"es . 3 . But what he really wants is more meat, foods, and less reliance on bread and potatoes. ,., If t""'J.-·e h arves ~-s ~..L-~11 '"' -· h ,... ., · -i ~. -~ Oir , i:.e rooa wii_,_ ' h :I t' , • 1 ­ J... not b e L ere , ana ne exL-ra casn wi_L just buy more and louder const.:rr~·2r gru.rr.b ling. G. Even in this relatively good year , the Soviet man-in-~he-stre2t h~s to s tar.d ', hours, and ::.nen ru::::s into s:)ot shoddy production , or sizes that don't aui~e .c. ' l.ii: . 1. There are nore current Russian jokes on '"I , • I ~n -~\' oL~~~ s··o-e~~ consQ~er oroble~s t~an v -ct___ L...c;;_ I... j "-' -• ~ A typical sto=y tells of the v~sitor who found noboav home at the aoart~2nt o= ..4 -8­ Colonel Gagarin, the cosmonaut. !:e asked a neiqhbor, aY1d-r1~c: +-1 ~ ' . .!.. - !. v· a~ 1....0_Ci. ·cna.... Ga~a.rin \·;as . orbiting in outer spc:.ce, and 1,·;0-~ld be h.o::-.e i .l-' h n 1....nree ours. "b ~ r.:o..,.. -:-·rs ' ... 4,::, L ...... l.'J. • G&gar:Ln, 5:12 had gone to the market to buy sose "'e ::::-~ ..... '--"""-/ and would not be ho~e for five hou~s. .L, , . H. In 1 v,....,n g ,,.U..... PY'Q"'•""0 ~ ...... , .,., -.... _ -~..1. I L.:J.e cutback in -'-l ~........ c; ..;._ -! • ­ dustry goals is also bound to have its effect on consw.-ner industry, a.s it prov:..des fei,7e::c of ~1'1e ~•. ~.LL...~ri·~1s ~ .... 1"-.... i:::: {...;. ana means for turning out w~at t 'ne consurr.er wan·cs.' VI. In sum.~ary, then, the Soviet Union proposes that its military and space expenditures--al~eady the higr..est in .1.:;.cs.J..:-,,..;2r history--ar2 to be boosteC. shar:;>ly in 1968. A. This is being acco~plished, however, at t~e exo~ nnce....., 0.Lc --a-ro1~1+-l-1 of the econo::-'.'.y. c.; __ fu+-u_rp'­ ::J -• '-­ ,.. . , 1. .Modernization or t:ne Soivet industrial plant will have to slow down. As a co!1­sequence, technological gains will lag, and maintenance a~d renair wi_l beco~e more expens:..ve .. -9­ •. ·~ , '-' t . . 2. Tn~ cu in agricultural funds means that the Kremlin is agai~ leavi~g its nopes for bigger food supplies at the ~ercv of the weather. B b1~'a..,q..=--.!L.-, nc ~ ~or.~~b -1 9 ~a ,. r.1,n· e 19 oc 8 -~ a , J'cne 1ans --a -8 ~o · ; may represent a compromise on resource alloca­tion which is acceptable to the collec·tivs Kremlin leadership. 1. As a compromise / however, it is probably . in- not fully satisfactory to any of the dividual leaders. The oresent decisions on resource alloca­ 2. ... 1 t . ' ,, 1 ., tion may yet co~e b ac~ o naun~ ~ne _eac­ership if long-term growth: rates decline, __......----'"'· ... ~.-----· -.... _. or if agricultural produc~~on stagnates. -10­