The CIA’s Tragic Error

Four years ago Jimmy Carter talked about banning nuclear weapons and cutting the defense budget by seven billion dollars a year. Today, he promises to develop the capacity to fight limited nuclear wars and to increase defense spending each year. Détente and arms control are almost dead. The hawks in Moscow are reinforcing the predilections of the hawks in Washington and vice versa. Most of the American advocates of negotiation, and of a balance of forces with the USSR, such as Cyrus Vance, Paul Warnke, Leslie Gelb, Marshall Shulman, and Andrew Young, have resigned. Zbigniew Brzezinski is ascendant. If Reagan wins, people who think like Brzezinski will continue to hold power.

This has happened partly because Soviet policy makers have made it possible. Soviet support for the intervention of foreign combat forces in Angola, Ethiopia, Cambodia, and South Yemen was obviously inconsistent with détente. The Soviet invasion of Afghanistan removed any remaining illusions that there were hopeful prospects for US-Soviet agreements. This use of Soviet combat forces showed that the Russians were willing to risk direct intervention in territory beyond the boundaries established by World War II, much as the United States had done when its combat forces were sent to Vietnam.

Even when détente was launched at the Moscow summit in 1972 the Soviets made clear their intent to support liberation movements in the Third World. But no American political leader would have accepted a concept of détente which acquiesced in intervention by combat forces from the outside. The Russians clearly went beyond the understandings of Nixon and Kissinger. These Third World adventures have been combined with a steady buildup of Soviet military forces. The Soviet Union, as we are continually reminded, will soon be capable of threatening the survival of our ground-launched ICBMs.

It has not been difficult, under these circumstances, for the American hawks to have their way. They long for the return of US nuclear superiority that would allow the threat of nuclear confrontation to force the Soviets to back down—the kind of threat that is widely claimed to have worked in the Cuban missile crisis. Even though some hardliners acknowledge that nuclear superiority may not be attainable again in any meaningful sense, they believe that by exploiting our technological advantages we can exert decisive political pressure on the Soviet system.

American polemicists, with Soviet help, have succeeded in creating an atmosphere in which Soviet strength is consistently and sometimes hysterically exaggerated. The origins of much of this exaggeration can be traced back to December 1976, three weeks before Carter’s inauguration, when the newspapers featured disturbing leaked reports about rising Soviet military strength. This was the so-called “Team B” estimate. George Bush, the CIA director at that time, had appointed a panel of ten military experts and Soviet specialists from outside the government to review the CIA’s own estimates of Soviet military power and intentions. Led by Richard Pipes, a professor of Russian history at Harvard, Team B was chosen to reflect a tough-minded approach to the USSR. Among its members were retired Army Lieutenant General Daniel O. Graham, the former head of the Pentagon’s Defense Intelligence Agency; Paul H. Nitze, former deputy-secretary of defense; Thomas Wolfe, a Soviet military affairs expert at RAND; and William R. Van Cleave, professor of international relations at the University of Southern California.

Team B, after working at the CIA for about three months, vigorously challenged the analysis of Team A, the regular CIA staff charged with estimating Soviet strength. George Bush adopted the Team B findings as the official CIA estimate. In an interview with The New York Times, he said that “new evidence and reinterpretation of old information contributed to the reassessment of Soviet intentions.” The most important new information available to Team B was the CIA’s assessment of Soviet defense spending, published in October 1976, which concluded that the percentage of Soviet gross national product absorbed by defense had jumped from 6 to 8 percent to 11 to 13 percent. The national press and television reported that the CIA had doubled its estimate of Soviet defense spending.

The text of the Team B CIA estimate has never been released, but the leaked story concluded that the USSR was moving ahead of the United States in military strength. The members of Team B asserted that the Soviets were developing the capacity to fight a nuclear war because they had worked out a strategy based on preparing and winning a “limited nuclear war.” In an interview with The Washington Post, General Graham said that there had been “two catalytic factors, quite aside from the Team B effort, which had shaped the appraisal of Soviet intentions.” One was the CIA estimate recalculating the percentage of Soviet GNP expended for defense. The other major factor in changing the official US perception, Graham said, was “the discovery of a very important Soviet civil defense effort.”

According to The New York Times, Team B analysts claimed that “the scope and detail of the Soviet civil defense program shows that it is clearly intended as an element in over-all military superiority insuring the survival of Soviet society against the principal adversary, the United States.” They maintain that the Soviet civil defense program is further evidence that the Soviets are positioning themselves to fight a nuclear war and still survive as a workable society.

Four years later the views of Team B have become even more influential than they were in 1976 and more in need of scrutiny. For all its conclusions are either wrong, or distorted, or based on misinterpretation of the facts. Many of them have been inadequately challenged by the Carter administration, or not challenged at all. Along with the Soviet military buildup and the violations of détente I have mentioned, the Team B arguments have had enormous consequences for US defense spending. Paul Nitze and several other members of Team B organized the “Committee on the Present Danger” which has become one of the most powerful lobbies for a larger military establishment. Today Richard Pipes and other members of Team B have joined their former sponsor, George Bush, and are serving as senior advisers to Ronald Reagan.

On civil defense, at least, the Carter administration has rejected the conclusions of Team B. Interviewed on television on August 17, 1980, Secretary of Defense Harold Brown said: “I don’t think massive civil defense programs are going to succeed in protecting the population of countries that try it. I think that the Soviet civil defense program, although it probably is ten times as big as ours, would not, in my judgment prevent Soviet industry or a great fraction of the Soviet population from being destroyed in an all-out thermonuclear war…. In a limited [nuclear] war if you target cities they are not going to be saved by civil defense.”

Here Brown reflects the conclusions of the CIA estimate published in 1979, which concludes that civil defense could not protect enough of the Soviet people and economy to maintain a viable society after an all-out nuclear attack. The Soviets themselves acknowledge that civil defense measures would provide little protection against the US nuclear arsenal. They maintain that their civil defense is primarily for the purpose of providing some protection in the case of war with China. They note that Chinese nuclear weapons are currently so limited that civil defense can still be reasonably effective against them. The US continues to budget about $100 million a year for civil defense, but most of it is to be used for disaster relief in the case of floods, earthquakes, volcanic eruptions, etc.

Undoubtedly, the members of Team B made their greatest impact on public opinion with the claim that the Soviet Union had doubled its defense spending during the 1970s. Most members of Congress believe this today. So, it seems, do most editorial writers. The CIA’s revision has become part of the conventional wisdom of defense policy. A recent study published by the US Air Force and prepared by the US Strategic Institute said: “Estimates prepared by the Central Intelligence Agency, as well as by US academic economists, have been in error by as much as 100 percent. The CIA estimates were accepted without question until 1976, when they were acknowledged to be grossly in error and doubled. Economists have not yet recovered from the shock of that experience.”

Similarly, Richard Nixon in his new book, The Real War, writes:

In 1976 the CIA estimates of Russian military spending for 1970-1975 were doubled overnight as errors were discovered and corrected…. When the first concrete steps toward arms control were taken, American presidents were being supplied by the CIA with figures on Russian military spending that were only half of what the agency later decided spending had been. Thanks, in part, to this intelligence blunder we will find ourselves looking down the nuclear barrel in the mid-1980s.

But Nixon, Team B, the Congress, and the press have been tragically misinformed. While Team B’s report of December 1976 remained classifed, the CIA’s own official report on Soviet defense spending of October 1976 had contradicted Team B’s conclusions, not supported them. The true meaning of the October report has been missed. A gargantuan error has been allowed to stand uncorrected all these years. Here is the CIA’s explanation for its change of estimates, as published in the 1976 report: “The new estimate of the share of defense in the Soviet GNP is almost twice as high as the 6 to 8 percent previously estimated. This does not mean that the impact of defense programs on the Soviet economy has increased—only that our appreciation of this impact has changed. It also implies that Soviet defense industries are far less efficient than formerly believed.” (Emphasis added.)

So while the CIA increased its estimate of the percentage of Soviet GNP spent on defense from 6 to 8 percent to 11 to 13 percent, there had in fact been no doubling of the rate of actual defense spending. During the period between 1973 and 1976, as CIA analysts refined their methodology and obtained better intelligence, they made an important discovery. In assessing the cost of Soviet defense production they had been crediting the Soviets with a degree of industrial efficiency close to that of the United States. What they discovered was that Soviet defense production, in fact, was not very efficient. Thus, the Soviet defense effort was absorbing a greater share of the GNP than previously believed. What should have been cause for jubilation became the inspiration for misguided alarm.

In fact, there have been no dramatic increases in Soviet defense spending during the entire decade. In its official estimate published in January 1980, the CIA concluded as follows for the 1970-1979 period: “Estimated in constant dollars, Soviet defense activities increased at an average annual rate of 3 percent.” In other words, the Soviets have indeed been increasing their defense budget, each year, at about the same rate as the United States and most of its NATO partners have raised their military spending, during each of the past four years. The US defense budget for next year calls for an increase, in real terms, of about 5 percent.

Much has been made, also, of the latest CIA study which shows the total cost of Soviet defense activities for 1979 as 50 percent higher than the US total in dollars, or 30 percent higher in rubles. For example, in his August speech to the Veterans of Foreign Wars, Reagan said, “…we’re already in an arms race, but only the Soviets are racing. They are outspending us in the military field by 50 percent, and more than double, sometimes triple, on their strategic forces.” These figures have very little relation to reality because of the dubious methods used by the CIA. The CIA obtains the dollar cost of Soviet defense by estimating what it would cost the United States to pay for the Soviet defense establishment. The Soviets have 4.4 million people in their armed forces, the United States has 2.1 million. Here is how the CIA estimates the costs of Soviet military personnel:

We obtain these manpower costs by applying US factors for pay and allowances to our estimates of Soviet military manpower. Soviet military personnel performing duties similar to those of US counterparts are assigned the same rate of pay as their counterparts. [Emphasis added.]

But US military personnel are all volunteers with relatively high levels of pay and allowances. The Soviet forces, on the other hand, are mainly conscripted and are paid at about one fifth the US rate.

The CIA so far has not publicly confronted the obvious distortions caused by these discrepancies. Neither have Reagan and his advisers or members of the Carter administration. (Similarly, when Reagan claims the USSR spends twice or three times as much as the US on its strategic forces, he evidently relies on a similar formula by which Soviet costs for executive personnel, factory workers, research staff, computer technicians, etc., are all calculated as if they were paid at relatively high US salaries.)

It is surprising, moreover, that this highly misleading formula has not led the CIA to project even higher costs for Soviet defense. The US defense budget for fiscal year 1981 calls for more than 50 percent to be expended on manpower, whether for salaries, allowances, housing, training, medical, or other activities. (This does not include the $13.7 billion paid for military retirement.) If we estimate the cost of the Soviet forces—which comprise more than twice as many people as ours—at our own rates one would expect that the Soviet defense budget would be 100 percent higher than ours. This would seem even more likely when one takes into account the inefficiency of Soviet defense industries, which all experts now agree produce weapons at a much higher cost than ours.

Clearly the CIA’s method of comparing costs is dangerously deceptive and does not provide an adequate basis for either Congress or the public to assess defense policy. At the same time several other factors should be given much greater emphasis when the administration presents the facts to Congress and the public.

The first is the great difference between the defense contribution made by the European allies of the United States and the Warsaw Pact allies of the Soviet Union. According to the recent report of the International Institute for Strategic Studies,^* in 1979 the European members of NATO spent $76 billion for defense and France, a non-NATO ally, spent $20 billion—a total of $96 billion. The Warsaw Pact members other than the USSR spent $17 billion, or less than one-fifth of the defense outlay of our European allies. (In citing these figures, I leave aside the obvious question whether the USSR can count on the loyalty of local Warsaw Pact troops in Poland, Hungary, and Czechoslovakia.)

Perhaps even more important in considering relative military burdens are the Soviet costs related to China. The US Defense Department says: “At least 22 percent of the increase in the Soviet defense budget during these years [1964-1977] has been attributed to the buildup in the Far East…. The high construction costs in Siberia suggest that the intelligence estimates may understate the cost of the Soviet buildup in the Far East substantially.” In addition, according to the Defense Department, the Soviets “station as much as 25 percent of their ground forces and tactical air power on their border with China.”

The Soviet costs in connection with China come more sharply into focus when we observe that the Soviets have forty-four divisions facing China and thirty divisions facing NATO. Of the thirty divisions in Central Europe, four are standing guard in Hungary and five have remained in Czechoslovakia since the invasion of 1968. In other words, there are about twice as many divisions committed to the China front as to the West German front.

Furthermore, the US does not have to match the Soviet forces facing China. These forces are at the end of a long and tenuous line of communication that can be servered, in time of war, by missile strikes. These are not forces that can be readily transferred to combat in a European war. On the other hand, if it is argued that the US defense budget should provide forces to counter the Soviet threat to China, then the Chinese defense budget should be included on our side—a total of $50 billion.

The combined NATO defense budgets are greater than the combined Soviet-Warsaw Pact defense budgets, and if the China factor is included, the Soviet proportion of defense facing the US and its allies is less than 75 percent of that of the NATO powers. The claim of Soviet military superiority is an illusion based, in large part, on a misunderstanding of the facts. As the Defense Department recently said in commenting on the 1980-1981 report of the International Institute for Strategic Studies in London, “The Soviets may have made impressive strides in upgrading their land-based nuclear missiles, but…the US remains superior in submarine and bomber-launched nuclear weapons.” As for conventional power, “The Communist Bloc may have more conventional weapons, such as tanks, but the West is ahead in counter weapons such as anti-tank missiles. The result is that both sides are about equal in total military power.”

The conclusion of Team B that has perhaps the most ominous continuing consequences is the finding that Soviet strategic theory has been different from ours—because the Soviets are said to believe that nuclear wars can actually be fought and that limited nuclear wars are a real possibility. Both Carter and Reagan have adopted dangerous doctrines based on this mistaken analysis.

In a tortuous speech at the Naval War College on August 20, Harold Brown attempted to explain Presidential Directive 59 which accepts the concept of fighting limited nuclear wars and provides authority to build the weapons necessary to carry out that concept. Brown said:

Soviet leadership appears to contemplate at least the possibility of a relatively prolonged [nuclear] exchange if a war comes, and in some circles at least, they seem to take seriously the theoretical possibility of victory in such a war…. The increase in Soviet strategic capability over the past decade, and our concern that the Soviets may not believe that nuclear war is unwinnable, dictate a US need for more—and more selective—retaliatory options.

Brown, however, made clear his own views on retaliatory limited warfare in his annual report to Congress this year, in which he said:

In adopting and implementing this policy we have no more illusions than our predecessors that a nuclear war could be closely and surgically controlled. There are, of course, great uncertainties about what would happen if nuclear weapons were ever used again…. My own view remains that a full-scale thermonuclear exchange would constitute an unprecedented disaster for the Soviet Union and for the United States. And I am not at all persuaded that what started as a demonstration, or even a tightly controlled use of strategic forces for larger purposes, could be kept from escalating to a full-scale thermonuclear exchange.

It is true that articles in Soviet military journals have discussed the strategy and tactics of nuclear war. Soviet military leaders say that if they are attacked with nuclear weapons they will fight and win a nuclear war. In this they do not seem different from generals elsewhere. US military planners are constantly engaged in war games in which nuclear wars are fought on paper, and through computers, and in the end are won. When Brown said on August 20 that Soviet leaders take seriously the theoretical possibility of victory, he might also have noted the statement of his own Chairman of the Joint Chiefs of Staff, made as long ago as 1977:

US nuclear strategy maintains military strength sufficient to deter attack, but also in the event deterrence fails, sufficient to provide a warfighting capability to respond to a wide range of conflict in order to control escalation and terminate the war on terms acceptable to the United States.

Neither Soviet nor US leaders, however, have ever talked about launching a first strike to win a nuclear war; nor have the leaders of either country threatened such a strike for coercive political purposes. Brezhnev has explicitly rejected the concept of limited nuclear war: “I am convinced,” he has said, “that even one nuclear bomb dropped by one side over the other would result in general nuclear exchange—a nuclear holocaust not only for our two nations, but for the entire world…. The starting of a nuclear war would spell annihilation for the aggressor himself.” Despite Team B and the rhetoric of the presidential campaign, both countries still can be said to follow the principles of deterrence and of avoiding a direct confrontation that would lead to a nuclear exchange.

Both Brezhnev and Carter, moreover, claim that the two strategic forces are equal. Harold Brown, in his speech at the end of August, confirmed that “we have essential equivalence now.” But if the Soviets continue to deploy more MIRVs on their missiles, and if we move ahead with a new round of strategic systems including the MX missile, the strategic balance may well be lost.

The better course would be to start, after the November elections, a new round of negotiations. While these are taking place, both sides should agree to freeze deployment of any additional strategic weapons and to do so while they are essentially equal in such weapons. Brezhnev has stated not only that he is eager to engage in negotiations, including limitations on medium-range nuclear weapons in Europe, but that he is ready to sign an agreement banning all nuclear testing, and providing for on-site verification. The US would be foolish not to explore these possibilities. Once such an agreement was signed, it would be very difficult to develop new nuclear weapons, because they cannot be relied upon unless they can be tested and demonstrated to be effective.

The opportunities for genuine arms control are still very real ones. The prospects for successful negotiation become better the more clearly both sides understand that one alternative is the growing possibility of accidental nuclear disaster. George Kistiakowsky, one of the world’s leading authorities on nuclear weapons and former science adviser to President Dwight Eisenhower, recently said: “Given the present geopolitical trends and the quality of the political leaders that burden mankind, it would be a miracle if no nuclear warheads exploded by the end of this century and only a bit smaller miracle if that did not lead to a nuclear holocaust.” There is not much time to continue to indulge the kind of irrational politics we have witnessed, on both sides, during the last few years.