A DOLLAR COST COMPARISON OF SOVIET AND US DEFENSE ACTIVITIES, 1966-76 (SR-77-10

Created: 10/1/1977

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National

Foreign Assw.mr.nt

CIA HISTORICAL REVIEW PROGRAM RELEASE AS SANITIZED

national security information ihorindsubjectrimiigl

A Dollar Cost Comparison of Soviet and US Defense

Ntimtl Fonts* Awumnl Center

7

Key Judgments

This publicationetailed classified supplement to an unclassified paper Issued under the same title in January of this year. The key Judgments are the same as those presented In the earlier paper. The reader is cautioned that the dollar cost estimates used in this comparison of Soviet and US defense activities must be vieuted in terms of the limitations, reliability factors, and conceptual frameu rk explained tn ihe introduction.

TotalProgiomi

Foreriod, the cumulative estimated dollar cents of Soviet defenseIs. the costs of reproducing them in the Unitedabout the same as US outlays for defense. The trends of the defense activities of the two countries, however, are quite dissimilar.

When expressed In constant US prices, the trend of the dollar costs ol Soviet activities Is one of continuous growth throughout the period, averagingercent per year. Growth Is evident in nearly all the major elements of the Soviet defense establishment.

Despite increases In current dollar terms. US outlays in constant dollarsontinuous declinend2 they have been below6 level. This decline reflects reductions in nearly every major component since the Vietnam buildup of the late sixties.

Note:esulteorganization, effecttoentelligence publications formerly Issued by the Directorate of Intelligence and by the National Intelligence Officers are now being issued by the National Foreign Assessment Center.

esult of these diverging trends, the estimated dollar costs of Soviet defense activities exceed US defense outlaysidening margin In every year6 they are0one-third higher than total US outlays. If pensions are excluded from bothonly the costs of current defenseestimated dollar costs of Soviet activities6 exceed US outlays by aboutercent

If personnel costs are removed from both sides. US defense outlays exceed the estimated dollar costs of Soviet defense activities by aboutercent overeriod, although6 the Soviet level Is aboutercent higher than the US. Alternatively, If research, development, testing, and evaluationwhich estimates are considerably less reliable than those for otherpensions are subtracted from each side, the estimated Soviet figure6 Is aboutercent higher than that for the United States, and the cumulative totals are about the same.

Raiourc* Cottgory Comparisons

Investment

The estimated costs of reproducing Soviet militaryprocurement of weapons and equipment (exclusive ofosts) and the construction ofaboulercent greater than comparable US oullays fureriod. They exceed US outlays by increasing proportionsnd6 are about twice as large.

Operating

US outlays for operating military forces exceed the estimated dollar costs of operating Soviet forcesince then the Soviet activiiy level has been higher In dollar cost terms.he estimated doliar cost of operating Soviet forces, exclusive of pensions. Is aboutercent above US outlays.

RDT&E

The estimated dollar costs of Soviet militaryrow over the period, while US outlayshis category decrease. For the periodhole, estimated Soviet costs exceed US outlays by almostercent.

Mililary Mfuton Compa.bcn. Strtfaafc Attack

The estimated dollar costs of Soviet strategic attack programs foreriod are twice those of the Ur'ted States.he Soviet figure Is almost three times the US lotal. The Soviet figure, however,rge peripheral attack force for which the.United Stales has no direct cOTnterpart For Intercominenta! attack forces only, the estimated costs of Soviet activities6 were about twice the US total.

Strategic Deferua

Foreriod, the estimated costs of Soviet strategic defense forces were almost four times US outlr.ys. Moreover, US outlays have been declining, and6 Ihe Soviet level wasimes the US.

General Purposa

US outlays for general purpose forces are abouterceni larger lhan the estimated dollar costs of comparable Soviei forces for .he period.owever, the Soviet level has been higher lhan thai of thehigher inreflecting lhc post-Vietnam reduction in US forces.

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CONTENTS

Page

Key

Introduction

Total Defense Activities

Military Missions -mnn i

Military

Resource Categories

Operating

Ii I I 1 A

Military Missions

Strategic Forces

General Purpose Forces

Support Forces

APPENDIXES

Page

APPENDIX A: Production 23

APPENDIX B: Costing Methodology 27

APPENDIX C- Revisions In Data and Methodology 31

APPENDIX D: Statistical Data 33

FICURES

Page

Fig otal US and Soviet Defense Activities

Fig istribution by Resource Category of US and Soviet Defense

Programs

Fig S and Soviet Active Military Manpower

FI-, S and Soviet MlliUry Investment

S and Soviet Investment in Strategic

S and Soviet Investment In General Purpose Forces

Fig perating Costs for US and Soviet

Figersonnel Costs for US and Soviet Forces

osts for US and Soviet

Figperating Costs for US and Soviet Strategic Forces

Figperating Costs for US and Soviet General Purpose

FigS and Sovietrograms

FigS and Soviet Forces for Strategic

FigS and Soviet General Purpose

SECRET

PRCFACC

This report presents the latest dollar cost estimates of Soviet defense activities and compares them with corresponding US defense outlays. The dollar cost estimates reflect the cost of reproducing the Soviet activities in the United States, using US cost factors and pay rates.

The Soviets, however, would view the distribution of their total defense effort quite differently from the way it is shown In this report Neither the system of accounts nor the structuring of expenditures by military mission or resource category Is the same for the Soviet Ministry of Defense end the US Department of Defense. Most Important, the price structures In the two countries are substantially different The Soviet view, of course, would influence program choices In the USSR.

This reportetailed supplement to the unclassified study Issued under tho same title In January of this year. Ittudy Issued In0ollar Cost Comparison of Soviet and US Defense

The report contains three major sections and four appendixes. The first section summarizes Ihe overall (rends in US ami Soviet defense activities. The second compares these activities by resourcea.id RDT&E. The third section compares the activities by major military missions. The missions as defined in thbforces, general purpose forces, and supportwith the guidelines given in the US Defense Department's Defense Planning and Programming Categories of

resents US and Soviet production data lor selected military weapon systems.ontains an explanation of the methodology used to cost Soviet activities and to structure the cost estimates to achieve comparability with US authorizations.iscusses changes to the data base and methodology since last year's study.resents summary tables of the costs of defense activities.

A Dollar Cost Comparison of Soviet and US Defense

The military establishments of the Soviet Union and the United States are difficult to compare because they differ considerably Instructure, and political environment. The common denominator used here to measure the defense activities of the two countries is dollar cost. The approach is to estimate how much It would cost to produce and man In Ihe Unitedilitary force of the same size and with the same Inventory of weapons as the Soviet force and to operate that force as the Soviets do. These ettimnled dollar costs are then compared year by year with US outlays for similar activities.

This approacheans of comparing the overall magnitudes and trends of defense activities In the two countries. Dollar cost data alsoeans for aggregating dissimilar elements of each country's military activities Into comparable categories and thus can show trends and relationships that are difficult to discern and measure In other ways. Thb approach, however, does not give an appreciation of the size of the weapons Inventories In any particular year, nor does It reveal changes In the Inventories over time.

The data presented here are espressed Incalendar5onstant price base Is used so that trends In Ihe cost estimates will reflect changes In military forces andrather than the effects of price changes. The US data are for fiscal years, while the dollar costs of Soviet activities are for calendar years.

Defense activities used In thb comparison are (IJ those that in the United States would be funded by the Department of Defense (lessmilitaryefense nuclear activities such as thoso which have been funded In the

SECH

United States by the Department of Energyhe activities of the US Selective Service System, the US Coast Guard, and the-Soviet militarized security forces (border guards and Interna! securityxcluded from this definitionpace activities that in the United States would be funded by the National Aeronautics and Space Administrationivil defense except for the pay and allowances of uniformed personnel engaged In such activities,eterans' benefits.

US dollar cost data are In terms of outlays. They Include outlays derived from the Total Obligatlonal Authority (TOA) series in The Ftvc-Year Defense Program issued by the Department of Defense Inheynclude Coast Guard and Selective Service outlays and DOE outlays related lo nuclear weapons and military reactors. The US data have beento constant prices and have been adjusted somewhat to achieve accounting coveragewith the dollar estimates made for the USSR. The US figures In this report, therefore, do not match actual budget authorizations or appropriations.

The estimates of the dollar costs of Soviet activities presented In this reportargin of error which cou'd be substantial for some Items. Our confidence is highest In the aggregate totalsonsiderably less at the lower levels of aggregation. Moreover, the reliability of ourcost estimates varies from category todepending on the reliability of ourof the size and characteristics of Soviet military forces and on the accuracy of the cost factors applied to those estimates.

i.

Wc have our greatest confidence In estimates In the Investmentof

weapons and equipment and constructionp uUiut onc-thhd of the

lotwi t'Mlinnh'tl dollar cosls nf Soviet (Infi'iiso activities for the period.

Manpower costs, constituting aboutercent of the total estimated dollar costs of Soviet actlvi-ties, are the largest and most reliable component In the operating category. For other operating costs, representing someercent of the total, both the quantity and quality of information are less reliable.

The estimated dollar costs of Soviethould be regarded as significantly less reliable than estimates for either Investment or operating.

On balance, we believe that the overall dollar cost estimate for Soviet defense activities asIs unlikely to be in error by more thanercent This judgment, while informed, issubjective and not the result of rigorous statistical measurement.

Because of the problems of comparingactivities, the uncertainties of theof Soviet costs, and the organization ofdata, the comparisons in this paper shouldconsidered precise measurements. Anydenominator used for comparative sizingand its limitations must beinterpreting such comparisons. Anydrawn from this dollar cost analysis mustby an appreciation of what It does

It cannot be used alone to draw Infer-nces about the relative military effectiveness or capabilities of US and Soviet forces. Other data, such as the size and technicalof the forces, the geographicalof the two countries, their allies'and requirements, strategic doctrine and tactical concepts, morale, and command and control capabilities must also befor such judgments,

It does not measure actual Soviet defense expenditures or their burden on the Soviet economy. These questions are addressed by different analytical techniques yieldingof the ruble cost* of Soviet mililary flCllvlllfS.

It does not reflect the Soviet view of the distribution of the USSR's defensehe price structures In the two couni-les are substantially different. Additionally, neither the system of accounts nor the structuring of expenditures by military mission or resource category is the same for the Soviet Ministry of Defense and the US Department of Defense.

Finally, dollar cost calculations tend to over state Soviet defense activities relative to tl ose of the United States becauseasic measurement problem common to all international economic comparisons and known to economists as the index number problem. Given different resource endowments and technologies, countries tend to use more of the resources that are relativelyless of those that are relativelya givenomparison drawn in terms of the prices of one country thus tends to overstate the relative value of theof the other. This tendency is morethe greater the disparity between Ihe economies.

The degree of overstatement of Soviet defense activities relative to the US that is inherent to the dollar cost comparison cannot be measured with precision. An appreciation of the magnitude of the Index number problem can be obtained, however, by calculatingilierIs, by examining the ratio of Soviet to US defease activities measured In ruble cost terms, which overstates US activities relative to Soviet The dollar cost comparison shows Soviet defenseto exceed those of the United States by aboutercentf both are measured in terms of estimated ruble costs, the Sovietire abouterceni larger than the US. Thus, the effect of the Index number problem is not large enough to alter Ihe basic conclusion lhat Soviet defense activities overall ore currently larger than those of the United Stales.

Total Dafaiut

6 tlw estlmoted dollar .cost of Soviet defense activities,8 billion expressed5 prices. Is more thanercent higher than the US defense outlayillion. If lite costs of pensions for retired personnel are Included on both sides, tho dollar cost of Sovlc' activities Is still about one-third greater than outlays for JS activities. Foreriodhole, the total dollar cost of Soviet activities Is roughly equal to the total US outlay.owever, the Soviet total exceeds that of the United States by overercent (see

Throughout ihe period the dollar cost estimates of Soviet defense activities growate ofercent aanillion08 billionft This trend is evident In nearly all major components of the Soviet defense establishment.

ifferent picture Is seen for the United States. Despite Increases in the current dollar costs of US defense activities, defense outlays expresses] in constant dollar terms declineafter the peaknd1 arc below6 level.

Resource*

stimated dollar costs of Sovietexceed US outlays In all three major resource categories. In investment, the category In which we have the highest confidence, theyercent greater than the US figure; in operating costs, nearlyercent greater; and In RDT&E. just overercent higher. Thiswith the Vietnam-era peak US spending yearhen US outlays exceed estimated dollar costs of Soviet activities in all threebyoercent.

For thehole, theof the dollar costs for the two countries Is similar: roughlyercent for operating,ercent for Investment, andercent for RDT&E. The Soviet share for Investment is remarkably coaMunt over the period, while the share foras risen (seehe US share for Investment anditS dcvline

Military Missions

6 the estimated dollar costs of Soviet activities exceed US outlays In all major military missions. For strategic forces lltey ore more than three and one-half times US outlays, for general

f

turpose forces, one-third greater, and for support oree-ercent higher.

Overeriod, support forcesfor the bulk of total costs forSoviet dollar costs and almostercent of US outlays. Gen-eral purpose forces costs constitute aboutercent of the total for both countries, with the strategic programs taking less thanercent for the Soviet and less thanercent for the US activities.

Military Manpower

Military manpower trends parallel those for total costs in the two defense establishments. Estimated Soviet military manpower grows throughout the period, increasing by moreen6he level of US military manpower has fallen steadily since the peak of the Vietnam buildupnd6 is less than6 (sec

Overercent of the estimated growth in Soviet military manpower occurred in the ground forces, alth-mgh all elements of the Sovie! defense establishment have grown during the period. Several factors have contributed loeneral modernization and expansion of alt force elementsart, as did the emergence ofotential enemy and 'He attendant Increase in the number of troops de-

C

fayed along Ihe Sino-Soviet border. Periods of lightenedexample, ilie Invasion of Czechoslovakia inalso served as an impetus for growth.

The Soviets historically have- assigned theirroader range of responsibilities than the United States.esult,military"

TOTAL US AND SOVIET DEFENSE ACTIVITIES

A Comixiilaon <il US Oullny* willt (UUmntnct rograms II Oonlicnlf-llolHoUS

6

-

RaWfliSH

MRMlJiMMldll

67

us

US^R

in MS<

oaapaiia

DISTRIBUTION BY RESOURCE CATEGORY OF US AND SOVIET DEFENSE PROGRAMS

US AND SOVIET ACTIVE MILITARY MANPOWER

MIIUGN MEN (MIOYEAR) -

10bo

07

88

60 TO

71

72

73

74

70

76

USSR toutNvdt.aKuittv IfOCH. fuel tonvtifchont,no ccummn. TN*SSRmtn.

includes border guards. Internaltroops, and constructionthe United States has no directEven If these forces are excluded,manpower Is nearly double the USi ; ;

Effect of Manpowar

In estimating the dollar costs cf Soviet military5 pay rates for the US all-volun-tecr force have been used for theeriod. The higher level of Soviet ml'.'taryresults In dollar cost estimates for military manpower that are more thanercent higher than US outlays8 (prevolunteer force) pay rates converted5 prices were used, the Soviet figure would beercent greater than that for the United Slates, and the total estimated dollar cost for all Soviet defense activities would beercent greater lhan total US defense outlays

Regardless of which pay rates are used, thr estimated dollar costs of the overall Sovieteffort remain higher than US outlays2f all costs for military personnel are subtracted from both sides, total estimated dollar costs for Soviet defense activities arc almostercent higher than total US outlays6

Impact ofn Coin

The cost of US and Soviet military pensions has been excluded from the comparativeade elsewhere in this paper. If they arc added to each side, tbe estimated dollar costs of Soviet activities6 exceed US outlays by aboutercent

The estimated dollar cost of Soviet pensionsmall share of the total that grows slowly over the

eriod. The US military retirementhowever, are broader in coverage, and over the period the portion of US outlays devoted to pensions more than doubles.S retirement costs, atillion, representercent of US outlays.

The Impact of Including pensions In thecalculations of dollar costs of defense activities tor both countries Is Insignificant0 onward, adding retirement costs has the effect of decreasing In each year the proportion by which the dollar cost of Soviet defense activities exceeds US outlays.

Resource Categories

The comparisons of estimated dollar costs for Soviet defense activities and US defense outlays are presented In this section by resourceoperating, and RDT&E.

The investment category covers the dollar costs of activities to modernize or expand forces through the procurement ofincluding major spare parts, andof facilities. Investment eoslthe flow of equipment and facilities into the defense establishment It Is not an Indication of the size of the force In any given year.

Operating costs are those associated with maintaining current forces, includingcosls. Operating costs are directly related to the size of the forces and to their level of activity.

Dollar costs forre those fordevoted to exploring new technologies, developing advanced weapon systems, and Improving existing systems.

Within the Investment and operatingthe shares of US outlays are shown by major missions. For Illustrative purposes we havethe estimated dollar costs ofimilar format, but It should bethat the shares shown for Soviet missions within/resource categories are only very rough

sec/t

approximations. At thii level of detail, theto assign Soviet costsarticular mission often becomes arbitrary. This Is particularly true in assigning costs among the support forces.

Investment

6 the estimated dollar cost of Soviet Investment activities Isillion, about twice the amount of the US outlay forWeapon system procurement is the driving component for both countries, accounting for aboutercent of the investment totals for each throughouteriod (see

The estimated total cost of Soviet investment for the entire period is aboutercent gieater than the US outlay, but the total for the last five years Is aboutercent greater. Sovietactivities66 reflect an Increase of aboutivisions in the ground forces and the construction of more thanajor naval surface combat ships, overuclear-powered ballistic missile submarines,ballistic missileseavy and medium bomber-type aircraft,ighter aircraft

The estimated dollar costs of Soviet investment grow at an average rate ofercent per year throughouteriod, surpassing US outlaysnd continuing at levels higher than those of the United StalesS outlays for investment during thisreach their peak8 and fall6 to aboutercent of6 level.

If dollar costs for investment are categorized bygeneral purpose, andgreatest difference between the United States and the USSR in this period Is infor strategic forces. Estimated dollar cosls for Soviet investment in this category are about two and one-half times US outlays66 (sec

For both countries, the dollar costs ofIn general purpose forces are much higher than those for the other Iwo missionaboutercent of estimated dollar costs for

KSMT'

US AND SOVIET MILITARY INVESTMENT

A Corriparl.on of US Outlay* ollar COBta ot Sovietuplicated In tha US

6

10

67

| . 70

Invesiment ind aboutercent of US investment. Cumulative and average US outlays for general purpose forces Investment over lhc period are close to Ihe comparable estimated dollar costs for trie Soviets.

The US ond Soviet trends over the period, however, nrc quite different (see6S outlays rise oonsldprably more rapidly than Soviet dollar costs, reflecting heavy US Investment In ordnance and equipment for general purpose forces In Southeast Asia.8nnual US outlays fallillion, and1 arc below lhc level of comparable Soviet dollar costs. The trend of US outlays1 has been more gradually downward, but Soviet Investment has grown more rapidly1 than before.he estimated dollar cosl of Soviet Investment in general purpose forces Isillion, overerceni above lhc comparable US outlay.

Operating

The largest portion of operating activities for both Ihe United States ond the USSR foreriod Is that associated with military

US AND SOVIET INVESTMENT IN STRATEGIC FORCES

A Comparison of USwith Hellmaiad! , Dollar Coals of Soviet Program- If Duplicated In Iho U9

BILLION DOLLARS

67

Dollar costs for personnel Include pay and allowances for active and reserve military manpower but exclude pay and benefits for military retirees. The remaining portion ofcosts covers the operation and maintenance) of military equipment and facilities.

i: :

6 the total estimated dollar costall Soviet defense forcesercent greater than comparableForeriodhole,oxceed the estimated Sovietby almostercent For thethey are about the same for both(see figure

; Estimated dollar costs for operatingorces Increase by more thanercent6his, upward trend reflects an

increase In manpower and In the equipment

holdings of the Soviet armed forces.

i

US outlays for operating, on the otherecline sharplyeakingheard trend endsnd there arcncreases In5

Il

Dollar cost estimates for Soviet military pcrson-'ncl show sustained growth throughouteriod. The trend for the United States is one of declining outlays for military personnel from

ft-

.item -

through the end of the period (sees Soviet forces are more manpower Intensive, estimated dollar costs for Sovietarger portion of operating costs.

US outlays, unlike those for other resource categories, are larger every year than the estimated cost of Soviet activities (seen the sixties this Isesult of the Involvement In Southeast Asia. There Isifference In operating concepts lhat has an effect throughout thegeneral, the

.United Slates tends to operate Its equipment more than the Soviets, who, for example, use more simulation In training.

Although In absolute terms the US levels higher than tl at for the Soviets, the trends for both countries are the same as those for tolal operating costs. For the periodhole. US outlaysre aboutercent higher than estimated Soviet costs.owever, the US level Is only aboutercent higher lhan that of ihe Soviets.

COSTS FOR US AND SOVIET FORCES

A Comparison of US Outlays with Estimated

Oolla* Costs ol SovietIf Duplleolcd In tho US

5 DOLLARS 60

'Si i

10

er

. T6

osts for us and soviet forces

comparison, by mission, reveals lhai (oreriodhole the largest portion of operating costs for both the United States and the USSR Is for the support forces. The second largest share for both countries Is for general purpose forces, and the smallest share is for strategic forces. Therearkedowever, between US and Soviet operating costs for each mission.

The estimated dollar cost of operating the Soviet strategic forces Is more than twice as large as US outlays foreriod. The Soviet level Is greater lhan that of the United States throughout the entire period, and6 Is over two and one-half times greater (see. Within the strategic mission, personnel costs make up aboutercent of total operating costs lor the Soviels and abouterceni for the .United States.

In the general purpose forces. US outlays for operating exceed estimated Soviet costs for the periodhole by abouterceni (see. Personnel costs again account for the largest portion of total operating costs forercent for the United Stales and almostercent for the USSR.

US outlays for operating the support forces exceed the estimated dollar costs for the Soviets by aboutercent for the period. Estimated Soviet costs rise steadily throughout the period, however, while US outlays decline rapidly94 and then level off. Soviet costs surpass those of the United States for the first timend6 arc aboutercent

nrsf

operating costs for us and soviet strategic forces

For the USSR, estimated costs formake up aboutercent of total operating costs for the period, while for the United States the share is aboutercent.

ROT&E

Estimates of dollar costs for Sovietctivities are based on analysis of published Soviet data and are considerably less rellablo than any other body of data in this report (seehey are derived only In the aggregate and Includectivities for military uses of nuclear energy. These costs grow throughouteriod and exceed comparable USby Increasing amounts in the seventies (see. To achieve comparability, the US data Include all Department of Defense outlays rntnd defense-relatedutlay* the DOE.

In this section the costs of military activities for lhc US and USSR are separated and discussed in detail according toforces,purpose forces, and support forces. This Is not the way the Soviets themselves organize their military missions, nor does It represent the way ihey would view the allocation of their resources for defense. Mission cost estimates are organized In accordance with the Defense Department's Defense Planningand Programming Categories. This categorization permits comparison of the estimated dollar costs of Soviet defense activities with categories often used In US defense analysis.

Strategic Forces

Strategic forces include all forces assigned to intercontinental and peripheral attack, strategic defense, and strategic command, control, and

f T

OPERATING COSTS FOR

US AND SOVIET GENERAL PURPOSE FORCES

V'KVa Comparison of OS Outlaya^rVh;

; Dollar Costs of Soviet Programs If Duplicated In tho US

0 COLLARS

: 20

US AND SOVIETROGRAMS

A Comparison ol US Outlay* wltn Estimated

Colli of Sovieta II Duplicated In ina US

5 DOLLARS

JO

AND SOVIET FORCES FOR STRATEGIC OFFENSE

a Comparison ol US Outlays *viih Estimated

Dollar Costs ol Soviet Proo'ams ll Dunticnlad In ttio US

OLLARS 15

5 DOLLARS 15

-

-

If,

warning. Overeriod, tho level of Soviet activity for strategic forces measured In dollars is almost two and one-half times that ot the United States, with the difference growinghe Soviet level Is over three and one-half times that of the US.

tfltafCQntlntfital All ink

This mission Includes the strategic weapon systems and manpower which are designated for an Intercontinental attack role. Land-based ICBM systems, ballistic mlrr!lc submarines for Intercontinental attack, and Intercontinental bombers are the components of this mission. Over theeriod, the Sovietattack activities account forercent of the total estimated dollar costs of Soviet defense activities.oviet ICBM activities account for aboutercent of the estimated dollar costs for this mission, missile submarine activities for aboutercent, anu bombers for the remainder.

3 billion, the estimated dollar cost of activities allotted to the Soviet Intercontinental attack mission6 Is more than twice the outlays for comparable US activities. For the periodhole, estimated dollar costs for Soviet Intercontinental attack forces are nearly one and one-hall times US outlays. US outlays for intercontinental attack activities are at about the same level6 as6 {see.

iCBMa

stimated dollar cost of Soviet land-based ICBM activities6 is9 billion, compared with8 billion In US outlays. Estimated dollar costs of Soviet ICBM activities for theeriod are over four times US outlays for ICBMs. Early in the period, the Soviets began to deploy thendnd estimated8 billion Inthis activity.of these missiles was completend In that year estimated dollar costs for Soviet ICBMs reached their low point for the period.oviy efforts for the new generation of ICBMS^-thondan upturn In estimated dollar costs which continued

By comparison, the United States had nearly completed Its planned ICBM deployment byeginning of the period. US outlays6 have remained relatively steady at closs toillion, reflecting operatingd upgrading of the Mlnutemaji force

Boflhtk MJuik Submarines tor Irn^ccrrHnerrtoI Attodc

This element includes all US ballistic missile submarine systems and the Soviet ballistic missile submarines which are estimated to have anattack role. Soviet ballistic missile submarines which are believed to have aattack function are Included In the strategic peripheral mission. For both countries, nonstrate-gic or attack submarines are included with the general purpose naval forces.

9 billion, the estimated dollar costs of Soviet ballistic missile submarine activities6 areercent higher than US outlays. For theeriod, Soviet activities exceed those of the United Slates by aboutercent.

Rising dollar cosls for Soviet activities in the late sixties arc caused by production oflass submarine with theissile. Fri'the early seventies costs ogain increase,lass program with Its longer range missile, thehese costs begin to decline againlass production comes to an end.

The United States, in contrast, completedof its Polaris force In the early si* ties. Operating expenditures and costs associated wiih Improvements to the Polaris system and the shift from Polaris to Poseidon missiles determine the trendith outlays for the Trident program beginning after that.

Mereontlnefrtol Bcmben

This category Includes the heavy bomberand other aircraft which have anattack role as their primary mission. Costs of heavy bomber operations are Included here even though the operations may have been

17

noiislratcglc Inas lhc use of the2 fleet in Southeast Asia. Estimated dollar costs of the Soviet Badger, Blinder, and Backfire bombers ore Included under strategic peripheral attack.1

6 lhc.estimated dollar costs of Soviet intercontinental bomber activities ore Just over one-third of outlays for US heavyvereriod, estimated costs for Soviet activities ore about one-fourth of US outlays for comparable activities.

The relatively low level of estimated dollar costs for the Soviet Interccu'lrental bomberreflects tlie static nalur^ of the force. As no new heavy bombers were produced overeriod, only operating costs of theBear and Bison bomber fleet were incurred.

Costs associated with US bombers decreased as use of 'he bomber fleet In Southeast Asia ceased, production of the FB-lll came lo an end.8 was phased out, andere retired. US bomber outlays remain nearly three times the estimated dollar costs of the Soviet program, reflecting the larger size of the US force, more Intensive US operating and tr lining schedules, und2 modcrnlzollon piogram.

Strategic Peripheral Attack

' AllD1A. it* Alt Force, andbelieve II unlikely lhai (he Baekftre bomb" will beir11 w'il altac*

onlan et th* C-aji taHWIc mtalW aubmartnemulcilnknu until ihe early itvtr-taea. and ihe dollar robih thne whmarlne* are Included In ihr Intercontinental mtafon unfll lhai llnw.

US fnr-ard baaed allaek. alrmfl ara Included In iha lac*leal air portion af Iha eroaril purpoaa fore* m'arieA.

Included In peripheral attack arc the Sovietballistic missilesntermediate-range ballistic missilesedium bombers, ond some ballistic missilemission Isttacking targets along ihe periphery nf Ihe USSR.Under current definitions, the United States has no direct counterpart to theseattack forces.1

t.tol estimatedmsti Un (be peripheral otlack mission2 billion, about

MO percent of lhc amount estimated for the intercontinental ollack effort. This rcln'ionsliip is -tnie for thelmlc. The estimated dollar cost of Soviei periplicral attack activities rises moderately0esult of the .vocuroment of llie Backfire bomber and the

RBM progrom. Tills upward trenda period of decline during Ihe latter half of the sixties, when there Is relatively littleIn new peripheral attack systems andcosts dominate the total (see.

Land-based missiles and peripheral bombers account for nearly all the dollar costs during the period. TheR DM, whose deployment reached Ils peak5 withhas substantial operating costs. Dollar costs of operatingedium bombers ore another significant part of the peripheral attack Intnl. Cosls for the C- and It-classoperating costs but also Including costs for ton-version and procurement ofan insignificant share of the pcriphcial attack program.

Strategic Defente

The strategic defense mission includes all US and Soviet elements ossigned the role of defense against strategic air or missile attack. Costs of lh'< missionose for strategic surface-In-air missiles, interceptor aircraft, and* mission (toes not Include systems whose purpose is to provide protectionactical role; 'hese are accounted for in the general purpose forces mission.

Foreriod, estimated dollar costs of Soviet strategic defense areercent of the lotal dollar.cost of defense activities. This conslrasls wiih US outlays, which are justercent of the total.stimated dollar costs for Soviet activities7 billion, more thanimes the level of US outlays. For tbe periodhole they are about four limes a* great.

US strategic defense activities are markedly different from (hose of thein magnitude andthe differing perceptions of the bomber threats lo the two countries- US outlays decline sharplynd6 are about one-fourth their level in the peak year

Interceptors

Estimated dollar costs for Soviet interceptor activities4 billionf the total for the strategic defense mission. Over theeriod, Sovietcostsillion, nine times the US total. Soviet Interceptor activities fluctuate moderately over the period, with peaks In the late sixties and4 reflecting procurement of new aircraft such as theiddler, thelagon, and theoxbat.

SAMs

Estimated dollar costs of SovM strategicmissiles also peak in the late sixtiesesult of an intensive effort to improve low-altitude and long-range defense capabilities against bomber attack. High costs for operation and maintenance of the extensive SAM network along with continuingndeployment are responsible for keeping the level relatively high throughout the period despite the phasing out of some older systems.

ABMi

Both Soviet and US costs for ABM activities decline sharply to an Insignificant portion of the total defense effort after the early seventies, when the agreement limiting ABM deployment was reached. Overeriod, US outlays are aboutercent higher than Soviet costs, reflecting the more advanced technology of the US system.

nd Worn log

This category includes central communications systems and command centers for strategic forces, early warning radar systems, and airborne command posts. Estimated Soviet dollar costs for these elements are mere than two-and-one-half times US outlays foreriodhole. During the period. Soviet costs rise while US outlays decline, and6 the Soviet level is more than four times that of the US

G-rxKo! Purpose Forcei

The general purpose forces mission includes the ground forces, tactical air forces, and those naval forces that do nottrategic attack mission. This mission accountsreaterof dollar costs than any other combatThe dollar costs for Soviet general purpose forces exceeded US outlays for simitar forces by someillionn contrast, during the height of the war In Vietnam the US outlays exceeded the Soviets* byS outlays for general purpose forces begin to decline. This developmentwith the steady increase in estimated dollar costs for Soviet forces, reverses theumulative US outlays for the entire period, however, are someercent more lhan comparable estimates for Soviet activities (see.

The largest component of Soviet generalforce dollar cost estimates is the ground, forces. Ground force activities, estimated atillion annually, average justf total general purpose for" lollor cost estimates. Naval force costs average aboutillion and constitute aboutercent of annual general purpose force costs for the period, with costs56 somewhat higher. Dollar costs for the tactical air mission in6he averge annual cost of the tactlck! air mission over the period is just underillion, amounting to aboutercent of total general purpose force costs. Mobility forces (airlift and sealift) areow level throughout the period In both absolute andterms, with their average annualillion and the average annual share of total general purpose force costsercent

SECREr

us and sovietgeneral purpose forces

the United States, the ground forces are also the largest component of the general purpose force mission, averagingillionfor theears. At the beginning of the period ground forces accounted for more thanercent of the outlays for the general purpose mission. The post-Vietnam cutback reduced the share of land force outlays to an average of aboutercent foreriod; As with ground forces, tactical air and mobility forces outlays increase during the height of the Vietnam war and generally decline thereafter.S tactical air outlays still amount to5 billion. The Navy generallyrowing share of the general purpose mission over the period, increasing from overercent6 to more thanercentobility forces decline slightly toercent

Ground

' US and Soviet ground force components of the general purpose forces follow the same general pattern exhibited by the totals. US outlays exceed Soviet costs0 when, because of US withdrawal from Vietnam and Soviet expansion

und modernization, the Soviet costs become larger.he additional forces along (he Sino-Soviet border as well as general force mod-ernlrallon drive the estimated dollar cost of Soviet activities toillion, nearlyillion more than comparable US outlays.

ToCfkol Air

US outlays for tactical air forces are greater than Soviet costs throughout the period The US margin Is greatest during the mid- to late-sixties, peaking atillionharp US decline comes at about the same time that Soviei tactical air costs begin to increase, decreasing the US margin to betweenillion andillion for the rest of the period. The increase in dollar cost estimates for Soviet tactical air forces results from the Introduction of new and more expensiveas theitter.ndlogger,oxbat. and themprove their capabilities against NATO and the Chinese.

The comparisons of US and Soviet tactical air costs include US naval carrier forces as part of ilic US force. This Defense Department accounting practice adds an element to the US force Ihat does not exist for the Soviets, and any comparison must take account of the impact of these forces. The US carrier forces average aboutercent of the total tactical air mission, with annual outlays of5 billion.

General Purpot* Naval Fare**

The general purpose naval forces Include ail major and minor surface combatants, attackantisubmarine warfare (ASW) aircraft carriers and aircraft, land-based naval air forces, amphibious warfare ships, and support ships Ballistic nvssile submarines and US attackand their aircraft are not included in this category.

6 the estimated dollar cost of Soviet general purpose navy programs,6 billion. Is someercent 'ilghcr than comparable US outlays. For the period estimated Soviet dollarhese activities arc nearlyercent

! itte US

greater lhan the US outlays, and exceed' level in every year0or both the USSR and the United Stales, the dollarosts of the general purpose naval forcesless thanercent of total defense costs throughouteriod.

Soviet forces with the primary mission of ASW and fleet air defense1 account for overercent of the estimated dollar costs of the generalnavy missionnd average nearlyillion annually6uring the period several new naval systems wereIncluding the Moskva-class guided-missile helicopter ships; the Kara and Kresta-II guided-missile cruisers; the Krivak guided-missilethe flnt Soviet ASW carrier, the Kiev; and the C-lass attack submarines.US general purpose navy outlays63 billion. Foreriod US outlays for ASW and fleet air defense average7 billion annually, orercent of the general purpose navy total. Prominent among the US naval activities during this period are the construction programse California- and Virgin la-class nuclear-powered gulded-mlssile cruisers, the gas turbine-powered Spruanceand the Sturgeon- and Los Angeles-class nuclear-powered attack submarines.

With the exception of the small costs associated with amphibious forces, the remainder of tltc Soviet general purpose navy costs during the period are associated with auxiliary ships. US outlays for amphibious and auxiliary shipsover ilw period In both absolute and relative terms.S outlays forforces6ercent of general purpose naval outlays. US outlays for auxiliaries amount to overillionf general purpose naval outlays

Mobility Fort**

US outlays for mobility forces, consisting of airlift and seallft elements, are greater thanSoviet costs for the first six years of ilie

'il--- (arm mijnr Mnd minor Mffan**lni i

altica. tubmiriM, Und-burd nanl .trrr.lt. andll

olh US and Soviet forces Increase over that time, after which tlte US forceharp decrease resultingoviet margin In each of the last three years of7 billion.Soviet costs arc higher at the end of the period, the cumulative US outlays arc more thanillion greater than Soviet costs.

Support forcei

Auxiliory Support

Auxiliary support consists primarily ofand military space activities, the US Coast Cuard. and the Soviet border guards. US outlays for auxiliary support forces have exceeded the estimated Soviet dollar cost In every year oferiod. Over the entire period US costs for this mission exceed dollar cost estimates for Soviet auxiliary support forces byhe Soviet level. however, has been rising continually throughout the period, while the US level has been declining6 US outlays are only aboutercent higher than estimated Soviet dollar costs for these forces.

' Rewarch needed lo compute the wet ot Soviet mill) forces oncomparable tublhc US hai not been completed The cornparbon givenever! hrleai Indicative. Wnce the ia of US mobilityominated by airlift; aralfft coati averageercent ot Iha annual total for mobility forcei ovrtyear period.

M'mion Support

The mission support category Includes most major headquarters and support activities from specific missions. Estimated Soviet dollar costs for mission support exceed US outlays in every year oferiod, and are aboutercent higher for the entire period. The difference has grown over the period, however, and6 the Soviet level Is twice that of the Ua.

Control Support

This mission encompasses all logistics-related activities, other activitiesentral supporthe Soviet internal security troops, and the costs of uniformed military personnelin civil defense activities. Duringeriod, US outlays for this mission have exceeded estimated Soviet dollar costs by overercent. As with auxiliary support forces,the Soviet level has been rising throughout Ihe period, while the US level has been decliningS outlays for centralforces exceed estimated Soviet dollar costs by less thanercent.

tuppon act Mile* Include, (ot rumple, Utile training family homlne. rrcrulllnt, medical care, prlntlna. and nubllihlne, andcommonlcalloni.

XI" author of this paper U

Ulttce of Strolegic P'search. Comments

on US and Soviet production of miliiary weapon systems are useful In comparing the size of each country's military activities over time. This Information, taken with other measures, con Increase our understanding of Soviet defense activities. Production comparisons, however,be used by themselves as measures ofNo net assessment of US and Sovietcan be drawn exclusively from these data.

Production comparisons can complementcost comparisons, but caution must bein relating the two bodies of data. The costs for some systems, such as those for ships, are phased over several years nnd arc not as directly related to production as those for smaller systems.

Although the following comparisons of US and Soviet weapons production arc fur fromwe have nltompled to address .those systems which were prominent and dynamic. The production data discussed in this annex represent only the production of weapon systems by the United States and the USSK for the direct use of tlieir own military forces. Production fornd for military aid to other countries has been excluded.

Missiles ICBMs

The Soviets ore estimated to have producedntercontinental ballistic6ore than twice the number produced In the United States during this period. During the late sixties, the Soviets were building up theirndorces andmall force of. Estimated Soviet ICBM production supporting this buildup averagedissiles per year. In the early seventies, production dropped sharply as deployment of thendnded, bul rose again near tlte end of lite period wilh the Introduction of the new-generalion ICBMs.

The United States, on the other hand. Iiad nearly completed its planned ICBM deployment In the Iwginnlng of the period. Although the United Slates deployed no new ICBM launchersoreissiles wrreduring the period as the Minulemanwas improved.

MRBM. ond IRBMi

In addition lo their ICBM forces, lite Soviets maintain nn extensive force of medium-ntermcrjiqlc-rnngc ballistic missiles. The United Slates has no counterpart for these syslcmCtlicre was virtually no new deployment of MRBM and IBBM systems duringproduction nf tlicse missiles dmp|>rd fromr yenrgluulng iifj.hr period toew each year by ilic late sixties. Therearled Increase startingiowcvcr. as tltc SI P.BM neared deployment.

SIBMi

Soviet production of submarine-launchedmissiles Is estimated lo have been about SO percent greater than that of Ihe US duringeriod. Estimated annual Soviet SLBM produclion, driven largely by the ini rod net ion nf theose steadily from less6 to1t lhal time, production of theegan to decline,Ilie drcrcast was somewhat offset by the

SE< /

introduction of an Improved SLBM systemonsiderably longer range, theotalSLBM production declined gradually to5 but then Increased slightly to

The pattern of US SLBM production Is clearly delineated by the two major activities under way duringeriod. Production of Polaris missiles, which marked the early part of the period, had essentially endedhesystem entered productionnd. though decliningeak of2 to less thanveragedear for the seventies.

ASMs

US production of alr-to-surface missiles duringeriod is aboutercent higher lhan that estimated for the Soviets. US production rates peaked8er year, reflecting the heavy use of ASMs In Vietnam. Afterwards, the level dropped sharply to less1ut Increased again, regaininger-year rate6 with the introduction of the short-range attack missile (SRAM) and Maverick.

We estimate that Soviet production of ASMs rose steadily fromt the beginning of the period to

SAMs

Estimated Soviet production of surface-to-air missiles was nearly five times US production. Exceptausennual production of SAMs for the Sovietssteadily from06 to0n recent years, added emphasis has been placed on tactical SAMs. notably theA-S, andhe largest contributors to the high levels of production In the mid-seventies.

The US has also emphasized tactical surface-to-alr missile (SAM) systems. Redeye and Chaparral production09 and totaled0 for the period. In theonsiderable number of Hawk missies wasUnlike the Soviets, however, the United Slates has noi devoted much effort to strategic. SAMs, and virtually ended production of ilicsc missiles

ASW Missiles

Over the period, US produclion of missiles for antisubmarinemore than two and one-half times that estimated for the Soviets during the period. ASROC and SUBROC production reachedut declined thereafter, and3 had ended entirely. The pattern of Soviet production of ASWhe opposite of the US pattern; Soviet production began7 end haseach year tonnually

Aircraft

Comparison of US and Soviet aircraftcan be misleading because of the extensive qualitative differences in the aircraft produced by each country. In ihis report, dollar costare based on the role or mission of the aircraft for consistency with the other mission comparisons. Comparisons of production are more appropriately based on similarity ofcapabilities.

Heavy ond Madium Bombers

The Soviets producedeavy and medium bomber-type aircraft (includingand support models) duringeriod. At the beginning of the period, they were producing the Blinder al an estimated rate of betweenndear. Production of this aircraft declined sharplyowever, and endednnual production of ihe Backfire, which beganas steadilyto abouter year. The Backfire is the only bomber -urrenlly being produced by the Soviets, although an ASW version of the Bear is still In production.

Tbe only US bomber produced during this period was theith fewer lhanuilt8

rKi Toetkol Attack Aircraft

The Soviels produced jasllghlcrs and tactical attack aircraft duringa third more than the United States. An Interesting aspect of production In this category Is the change, for both countries. In the type of aircraft produced. During Ihe sixties, the Soviets concentrated on producingpecific mission. Introducing several newthe Flagon, Fiddler, andenhance their air defenseDuring the seventies, ihey began lomore versatile multipurpose olrcraft. They introduced the Flogger and the later variants of IheJ. K. andof which have both interceptor and ground attack roles.

For the United States the trend was reversed. Large numbers ofultipurpose fighter were produced during the sixties, but beginning in the seventies the production ofpecific role, such as4 all-weather high-performance Interceptor,

Helicopter t

Annual Soviei production of helicopters rose steadily from Just6 to morehe increase has been highlighted by production of the Hip, running ater year near the end of the period.

Once again, the trend for US production Is the reverse of that estimated for the Soviets. US production of helicopters, as with the fighters and attack aircraft, strongly reflects lhc requirements of the Vietnam conflict. Annual productioneak of8 but declined rapidly In subsequent years, and6 had fallen. Despite the downward trend, however, US production of helicopters overeriod was nearly two and one-half times that estimated for the Soviets.

Land Arms

Limitations of the data available at this time restrict our comparisons of US and Soviet land arms production to armoredand armored personnel carriersrie USSR produced more0 armored vehicles6uring the same period, Ihe United States produced Just

Tonki

The Soviets produced about six times as mam-tanks as Ihe United Slates duringomparedas on the production of medium tanks5illimeter gun,2mgun, and2arge-caliber, smoothbore weapon On the US side, most of the deliveries weretoneconnaissance vehiclem gun. andA1 tankm gun.

Armored Perionoel Carrieri

The Soviets produced0 APCsthe period, nearly three times more than the United Stales. Among the Soviet carriers were thenderies, which carryquad of infantry Iroops, BRDM wheeledarmored reconnaissance vehicles, which carry four lo five Iroops. and BMP (racked amphibious armored Infantry combat vehicles, whichquad. US production wasbyton tracked Mlehicle, which can carryquad of troops.

Navol Combatant Ships

Although many types of ships were delivered to each country's fleets duringonly naval combatants andships that contribute most directlyavaldiscussed in this section.

The Soviets builturface combatant ships and submarines during the period, while the United States built. The disparity is not as great, however, when considered In Icrms of ship tonnage. The Soviets tended to build smaller ships than the United Slates, and total Soviet production amounted toons. This Is aboutercent greater lhan the US

produclion ofons. The Soviet preference for smaller ships, however, Is true only for surface combatants. Attack submarines arc about the same size for both countries, and Soviet ballistic missile submarines tend to be somewhat larger than those of the United States.

Surface Corr-batentt

During the period, the Soviets deliveredurface combatants to their active fleet, versusor the Unitedhe tonnage for both countries, however, was nearly equal at

The United Stales added two new attackduring the period. While the Soviets have no equivalent, they did build two Moskvo-closs ASW helicopter ships In the late sixties, and5 completed the first Kiev-class ASW carrier, whichomplement of fixed-wing vertical and short takeoff and landingTOL) aircraft.

The Soviets builtulded-mlsslle cruisers duringof the Kara class, four of thelass, and nine of thelass. US gulded-mlsslle cruiserduring the same period consisted of six ships of the conventionally powered Belknap class and four nuclear-poweredTruxtun. two California, and one Virginia class.

Both the United Slates and the USSR added destroyers to their deployed forces during the period. The Soviets builthips each of the

' Incrodci nufor and mine* Mrfaec eombalanO (Inetudlraj Cat* Cuard cutten and patrol craft] but eadodn amprdbtova airfare ah'pi and aaaauh helicopter earner*

Kashln and Krlvak classes. The United States added five Spruancc-class destroyers to its fleet. The Soviels had three active frigatethe Pelya. Mlrka, and Jaguara total_ production ofhips. The United Stales also liad three frigate progratthe Knox. Carcla, andhips.

The Soviets addedanuchka-class guided-mlsslle patrol gunboats,risha-class gulded-mlsslle escorts,sa-class gulded-mlsslle boats,umber of other minor combatants to their Inventory. The United States addedatrol gunboats during the period.

Attock Submorlnti

During the period, the USSR builtttack submarines,f which were nuclear powered. The Soviets pursued both nuclear and diesel submarine programs; the US built only nuclear jubmtrines. Theuclear classes and the F, T,lesel classes accounted for most of the attack submarines produced in lhc USSR. The United States builtuclear-poweredsubmarines; all except theLosof the Permit and Sturgeon classes.

Ballistic MifsiW Submormes

Duringeriod, theubmarines oflasses. Completion67 of the final eight nuclear-powered ballistic missile submarines of the Benjamin Franklin class accounted for the US deliveries.

Appendix B

COSTING METHODOLOGY

of Dollar Estimate.

Dollar costs of the Soviet defense effort are estimates of what It would cost the United States to purchase the same military equipment and supplies, pay Ihe same number of people, carry on the same types of RDT&E, and pursue the same operations and maintenance activities as the Soviets. These estimated dollar costs areyear by year with US outlays for similar activities.

Constant and Currant Prkei

The dollar cost data presented in thb report are expressed In terms of average calendar5 US resourceonstant price base is used so that all changes In spending from year to year reflect changes In the military forces andthemselves, rather than price changesfrom Inflationary factors. Dollar costsIn current prices show trends that are quiteurrent price series would reflect, for example, the increase in US military pay authorizations related to the transition to the all-volunteer army, as well as the Inflation that has affected the US economy.

The US and Soviet data bases were converted to5 resource prices by theof resource input Indexes. Resource input indexes were used In the absence of appropriate output price Indexes for military Items.

The US and Soviet data were Indexed thb yearore detailed methodology than was used for past defense cost comparisons. Indexing has been extendedreater number of producers' material and labor Inputs, and provision was made for changing the relative proportions of labor and materials through time. The impact of the new methodology will vary throughout the times pan of these comparisons.

Estimating tha Dollar Costs of Soviet Activities

The dollar costs of Soviet defense activities are developed for the most part on the basisetailed identification and listing of Sovietforces. The force components listed are multiplied by estimates of what they would cost in the United States in dollars. The results arc then aggregated both by military mission and by resource category.

The reliability of the estimates depends on the precision and accuracy of our estimate of the Soviet activities and of the cost factors applied to that data base. The data base on forces and weapons reflects the combined collection and analytical efforts of-the intelligence community. Available intelligence Information has made it possible toetailed inventory of the numbers and kinds of weapons and units that make up the Soviet armed forces. This extensive data base includes Information on such Items as physical and performance characteristics ofweapons and equipment and theirdeployment levels of Soviet strategic attack, strategic defense, and general purpose forces; and the manpower levels of these forces and their support elements.

Investment

Investment costs are those for procurement of equipment and spare parts and for construction of facilities. While the sjwclflc technique varies according to the Information available, thecosts of mostmis-

sites, andderived through the use of cost estimating relationshipshesewhich relate US weapon char-acteristlcs (for example, weight, thrust, or speed) toapplied to Soviet weaponwhich can usually be ascertained withconfidence through intelligence methods.ew Items of Soviet equipment which have become available, cost analysts from US weapons manufacturers have been contracted toart by part, the production costs. In additionore detailed estimate for the Items examined, these cost analyses In some cases have provided the basis for adjusting the CER-dertved costs estimated for similar weapons.

The lack of necessary data on some systems makes It impossible to use either of the two approaches described above. In these cases, directthe cost of similar USsome other gross approximation of cost, such as estimating total costunction of total weight, is used. Some ammunition items, for example, are costed using these less refined methods.

Construction cost estimates arc basedood knowledge of Soviet construction practices and ruble construction costs. These cstlmat.-ti costs are converted Into dollars by the useuble-to-dollar ratio based on the cost of similorin the United States.

Operating

Operating costs are the sum of personnelsubsistence, and otherand operations and maintenanceosts include those which support the functioning of the defense establishment "nd cover such diverse Items aa fuel consumption andof facilities.

Dollar costs for Soviet military personnel are estimated by applying US factors for pay and allowances to estimates of Soviet militaryAverage factors are derived for each US service by dividing total pay and allowances for each service by total manpower In Ihat service. The appropriate factor is then applied to the manpower estimated for each Soviet military unit

ost estimates are based on US analogy. The costs of overhauls for armored vehicles, for example, are related to the original procurement costs of the equipment usingfactors based on US experience.are made, however, to reflect Sovietrates when they axe known to differ from US practices. The cost of petroleum, oils, and lubricants (POL) is based on estimated Soviet consumption rates for each weapon system. For example, the estimated fuel consumption ratearticular model of Soviet aircraft Is applied lo the average number of flying hours for that type of aircraft The resulting quantities of FOL are then costed at US prices. In general, theon operating rates Is not as complete in quantity or quality as theandon the forces.

Facility maintenance costs are based on the assumed life of the facility andunction of the cost of constructing it US and Sovietis believed to be similar in this area.

RDT&E

The direct costing approach described above is not used to estimate the dollar cost of Soviet military RDT&Ebecause the type of dkia needed for direct costing of observed activities is not readily available. Instead, published Sovietdata and descriptive material aboutactivities are usedasis for estimaling militarynd space activities in rubles. The dollar costs of these activities ore obtained by converting the ruble estimate Into dollarsubte-to-dollar ratio. The eslimate corresponds in coverage to the categories of USctivity funded by the Department of Defence and the defense-related portion of the Department of Energy (DOE) research program.

For several reasons, the estimated dollar costs presented for Soviethould be regarded as less reliable than the dollar costs estimated for Investment and operating. First, because the basic

there Is an element of uncertainty about its reliability and about our understanding of it. Second, the distribution of Soviet RDT&Ebetween military and civil applications continues toifficult problem. Finally, the conversion from rubles to dollars presents aof theoretical complexities as well as practical problems.

Organization of tha US and Savlaf Data

The definition of defense activities used in this comparison encompasses those activities that in the United States would be funded by theof Defense (less all but the personnel costs of foreign military assistance and civildefense nuclear activities such as those funded In the United States by the DOE, the activities of the US Coast Guard and the Soviet militarized security forces (border guards and internal securitynd activities of the Selective Service type.

US dollar cost data are In terms of outlays. They Include outlays derived from the Total Obligatlonal Authority series In The Five-Year Defense Program Issued by the Department of Defense inecause the data have been converted to outlays in consin.it price terms and have been adjusted to achieve accounting coverage comparable with the dollar estimates made for the USSR, they do not match actual budget authorizations or appropriations.

The organization of the US and Soviet military mission comparisons follows tbe mission structure outline In the Defense Departments Defense Planning and Programming Categories.of the DPPC guidelines hasore complete allocation of entities which In previous estimates were Included In the calegory of "command, support and other.

This report also presents comparisons of US and Soviet defense effortsesource category basis. These data were structured in accordance with current FYDP and budget resourcedefinitions. Because these definitions have varied over time, adjustments were required to achieve consistency of the resource categorythroughout the period of analysis.

The comparisons In thisbyand by resourcesubject toof uncertainty and therefore should notas precise measurements. This istrue In areas where the differenceUS and Soviet levels is estimated toor where the comparisons are made at aof.,

blank page

Appendix C

REVISIONS IN DATA AND METHODOLOGY

A number of Important changes have been made In this year's comparisons on both the Soviet and US sides.

On the Soviet side:

The estimates of Soviet defense manpower were completely reexamined during the past year, resulting in an overall downwardofercent in the estimated total manpower of the Soviet defenseincluding civilians working for the Ministry of Defense. This resulted in ain estimated costs of aboutillion per year.

To remove an element of double counting In previous estimates, Soviet construction troops have been excluded from military manpower. These costs are more properly captured in construction costs, which are estimated directly and carried undercosts. This resulted In an estimated reduction of aboutillion per year.

New Intelligence Information and Improved costing methodologies have causedchanges in estimates of production and dollar costs of Soviet military equipment. On balance, however, these changes had little effect on the total dollar cost estimates.

On the US side:

price deflators used to convert US data irom current tostant dollars have been Improved. The use of new deflators has, on balance, raised the constant price costs, with the largest effect In earlier years and almost no effect In recent years.

Coast Gaard ond Selective Serviceaboutillion perb*ento achieve better comparability.

The conversion of Total Obligations!figures to outlays makes the US data mote compatible with the data used for estimating the dollar costs of SovietFor Ihc period of this report, outlays have averagedercent lower than TOA. The difference, however, fluctuates in any given year. Most of the difference is in the investment category, because moneyfor Investment in one year isspent over several years. Investment TOAor example, isillion higher thannvestment outlays, however, decline almostillion56 because some cf theamount will be spent7 and later (see

Chonges affecting both sides:

This year the mission categories follow the definitions outlined In the Defense Planning and Programming Categories. This revision provides mission categories that are more familiar to US planners thin those used last year.

This year's comparison Is In5 dollar prices Instead4 prices. The change In base year resu'ls in an apparent, not real, overall Increase In dollar costs for both sides throughout the period.

BLANK PAGE

Appendix D

STATISTICAL DATA .

The financial data in this appendix ate basedetailed single-value statement of the Soviet and US forces which was specified solely for costing purposes. Key elements of the forces usedlfor costing are shown In summaryn tables II and 12

Figures for all activities are expressed In5 resource prices. Figures for the USSR are for calendar years and those for the United States arc for fiscal years.

The estimated dollar costs do not Include costs for Soviet civil space activities, costs for retired pay (unless othewiser costs for military assistance or civil defense (except for the pay and allowances of uniformed personnel engaged in such activities).

TABLE 1

Estimated Coitl of Soviet Defense Progromi If Duplicated fn the United Statei, by Minion '

Billion

form

I7.e

9

4

orte*

a

J

4

Ml

3

4

3

7

OS.3

The* ertlmated tWUr eeMi are deilgned to Indicate ihe general Ute ol ihr Soviet form and program* byhit ihey would irmj it purrhurd ind operated In tUnitedhe eorti ihown lor thr ma|or fnrce mltuom Include cntfi [or prranrmet. whet npriallng emta. procurement o( hardwire, and con*ruction ol laciktW Estimated dollar reaJi (or military BDT4Ehern aggregated ami are Included Inntoton (eicludln* mililary peraonnelll corti lor dvtl ipace. nnnprnonnel mililary aulilancr progiamj. andcNtl delenw acllvlllea eicept lor ihe pay and allowance* ot uniformedngaged In inch program* haveinded(or uralrglc lorm and general purpoae lorces Include only Ihoae coaU amcUIcd with combal or combal aupport unlli Throe corn not amrttted with mmr combat support unlU (eaecpt RDT4E) have been aggregated within the "lupoort form" Thii mlulon abo Include* all eorti loa civilian and retired personnel ai well ai corti which, brcaute o( pmmt dataannot br aolgned for both countrlct lo other mlolom Dila air lot calendar yean.

IVeanar of rounding, compnnrnti may not add to the lotah thown

S Defense CMbyi by rAfsslon

fforce*

purpca* force*

Support fn

RDT4B

Milne.5

1

1

7

The outlay) ihowo are developed Irom appropriate rdlltoni of The Five-Year Defense Program, the Budget ol* the Untiednd related data. Toighdegree of comparability as possible. US program data have been resggregaled and converted to cnnsUnt3ata are for fiscal years.

* Because of rounding, components may not add to the Intib shown.

TABLE 3

Estimated Costs el- Forces

Program* If OurJkoted in the United States, by Element

1 These eatlmated dollar costs are designed to Indicate the general site of the Soviet strategic force* by showing what they would cost li purchased and operated In the Unitedhe eattmaled costs shown Include coat* (or military personnel, other operating costs, procurement of hard wart, and construct kmet lilies foregie attack tysterns and for rysterru assisted to the defenae of the USSR against air, mlaalle. and apace attack, etoept tbe entisubenarla* warfare forces, which an- Included In aeneral purpoae navalnee-mpejaai the regional control and warningnd all SAMs. ABMs. antlsatellltendassigned lo Ihe National Air Drfrt.se limn No RDTAE coats are Included. Data are for calendar years

' Because of rounding, tor-portents may not add to the lotah shown.

5 I

attack

4

t

attack

2

I

2

nd, survdlknoa, and

weapons mmwmmimmi

9

4

US Strategic Forces Ouhoyi by Element'

survell-noe, and

!;

-,

.

Tho outlays shown are developed frora appropriate edition* of The Flw-Year Defense Program. To achieve asegree of comparability ai possible, US program data have been reaggregated and cooverted to constant5 dofiara DaU areeal years.

Because of rounding, componenb may not add to tho totals

TABLE 5

Estimated Costs o( Soviet Intorcontinontol and Peripheral Attock "rograms If Duplicated In the United States, by Element1

5 8

btertonttoental

peripheral attack:

and IRBMi

These estimated dollar coats are designed to Indicate the general -re of the Soviet strategic intercontinental and peripheral attack forces by showing what they would coat u* purchased and opmtad In the Unitedhe estimated costs shown Include corts lor military personnel, other operating costs, procurement of hardware (excluding nuclear warheadO, and construction of factinic* fot long-range altaek weapon systems. Nooats are Included. The Unitedo force with an assigned mission comparable to the Soviet strategic peripheral attack mission For this reason, the Intercontinental and peripheral attackHave not been totaled together toingle dollar costale for strategic attack. Data are for calendar years.

' Because of rounding, oompooeots may not add to the total* shown.

US Strategic LnttrconWiloI Attack Outlay* by Element'

3 I

0

11

40

Tne outlays shown are developed from appropriate adlHons of The Five-Yewrogram. Toegree ol comparablllry ai poadhle, US program data have been roaggregated and convened to conjlant3 dollar* TV UnUed States has no loreeission coo pan Ua to tha Soviet strategic peripheral attackata are for (Ural yean.

' Because of rounding, componenti may not add to tbe totab shown.

TABLE 7

EiHmated Coth of Soviet General Purpose Force*psko*ed In tfte United States, by Element1

3 I

forora

force*'

air force*4

S

1

1

loroea1

These estimated dollar coat* an designed to Indicate the general die of Soviet general purpose force* by fhewiBf what they would cost If purchased tod operated hi Ihe Unitedhese eetlmaied dollar cost* Indod* coats for mflHary personnel other opmKng coati, procurement of hardware faieludlngnd cortftruction of (acitlltea for systems assigned lo So-vrl general purpose force* Nooats are Included. DaU areeipceeaed In calendar yean.

These coats ara for surfaceaval aircraft, and general purposehe estimated dollar costs forissile submarines are Indjded -ithln ihe strategic intercontinental or peripheral attack mlsUons.

These cost* are for flxed-wlng alrcrafl that areactical combat support role. ASW atrcrafl and ASW cairlet costs are allocatedhe general purpose navaln accordance with ihe fiscal guidance category allocation of the US Department of Defense.

coats are for airlift force*

' Because of rounding, components may not add to iha totab shown

US General Purpose Force* Outlays by Element1

5 I

force*'

air force**

86

force*

0

0

outlay* shown are developed from appropriate editions of The Five-Tear Defense Program. To achieve asegree of comparability as possible, US program data have been reaggregated and converted to constant5 dollars. Data are (or fiscal years.

1 These outlay* arc for surface combatants, aircraft, and general purposeutlays for ittacl carriers and their aircraft are considered as part of tactical air forceshose for balliitlc missile submarines are Included in the strategic Inlercontlnenu! attack mission.

These outlays are for land- and sea-bated (Ised-wtng aircraft thai areactical combal support role. In accordance with the Defense Department's fiscal go Id* nee category structure, outlays rallied to attic, carriers ire Included in tactical air forceshose (or ASW carrier and ASW aircraft are Included In general purpose naval forces,

These cost* arc for airlift and seahft forces.

' Because of rounding, components may not add to the totab shown.

table 9

estimated colts of soviat defense progrcintt if oupfkoted in tho united states, by resourco

3 i

3

o

aod reserve miliiary

8

aod culnlro-

'

stimated <uu. coatskate(rml sit*have beer, aggrrpitad and an inc-adad madcc bdt4e. al ecab for bix-aar

overall titodi la soviet defense programs by showing what jhey would com(eadudlng rdtae) ha-tt boeo accounted for in procurement ah oaea

purchased and opaaa-usd in the united sutra. they do not representdvtl mtm mwmm, all eonpenonacftoats tot mhltary atdatanna programy and

rtaouro* allocations as tha soviet* would mo them. toegreeof dvll defcuso except for tho pay and adowantes of tmtfoRBcd penonrwl

comparability ai possible, adjutf menu hava been made to lite basic databeen eicluded. data are foe celo-dar yean

for both the united stain and tbe ussr all estimated coda for rdtaedecause of rounding, component* may not add to tbe toubmillury personnel pay and allowineeaj associated with mlliury pro-

Table 10

US Defense Outlays by Resource Cateaory <

The outlays shown were derived from tbe totaluthority series In The Five-Year Defense Program, tbe Budget of Ihe United States, andata. To achieve asegree of comparability as possible, adjustment] have been made lo ibe bade data available for both the Uniied States and USSR. All outlays forctivities (esdudlng rrttfttary personnel pay and allowances) assoeiaied with military programs have been aggregated and are Included under liDTAE. Dcfcnso-reUtcd DOE outlays forre also Irctuded in RDT4E. Ail other defense-related DOE outlays have been accounted for In procurement. AD outlays for civil space activities, military assistance, and civil defense programs have been eicluded. Data are for fiscal years.

' Because of rounding, compoiienls may not add to the totals shown.

j3

TABLE 12

Nornbor* of Soviet Groundnit* end

Selected Iterm of Fqufprnertt for General PurpoM Forces

fofC*?jt

1

IP

m

forces:

surface

furfaeo

purpc*e

aircraft

These single-value estimates have been developed for costing purpwe* from the appropriate National Intelligencell hough they fait wdhln the range* of likely alternative force structures presented In the National Intelligence Estimates, they do not nccer-arily match any particular force. Data are eipressrd In midyear terms.

1 Divisions estimated to be mtlntalned at nearly full strength and to have all their critical combat and support equipment

estimated to be manned a! about two-thlrdt wirilme Strength and to have allomtut equipment. Some are deficient In support equipment

' Divisions used primarily during Ihe buildup of forces along tbe Slno-Sovlet border. They are thmr unfit that are hetween cadre and reduced-strength status but lo which availableoncentrated In one or two maneuver units to provide some Immediate combat capability.

estimated to be manned up lo one-lhlrd of wartime strength and to have all critical combat equipment butdeftclende* In support Item*.

Original document.

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