US industry unready for '40s-type war effort

Remember the old World War II newsreels? B-24 Liberators rolling off the assembly lines at the Ford Motor Company's Willow Run plant near Detroit; Sherman tanks lashed to endless, snaking lines of railroad flatcars bound for East Coast ports; throbbing munitions plants; bustling shipyards.

America seemed to have little difficulty transforming itself into President Franklin D. Roosevelt's "great arsenal of democracy" during those years.

By 1945, it had produced a staggering quantity of war material -- including 310,000 aircraft; 88,000 tanks; 71,000 ships (including 27 aircraft carriers); 900,000 trucks and motorized weapons carriers; and 12.5 million rifles and carbines.

But could US industry perform similar feats today? Apparently not.

A congressional committee that examined this question recently reports that "a shocking picture emerged." The investigation, conducted by a panel of the House Armed Services Committee, found "an industrial base crippled by declining productivity growth, aging facilities and machinery, shortages in critical materials, increasing lead times, skilled labor shortages, inflexible government contracting procedures, inadequate defense budgets, and burdensome government regulations and paper work."

It concluded, moreover, that the US Defense Department "has neither an ongoing program nor an adequate plan" to tackle the problem, despite the fact that its own think tank, the Defense Science Board (DSB), has twice drawn attention to it -- in reports it published in 1976 and 1980.

But there are indications that the Reagan administration plans to assail the problems besetting the nation's defense industrial base more energetically than has been done in past years.

Essentially, the problem concerns what defense experts call "surge capability" -- the capacity, achieved in World War II, to speedily increase the output of tanks, guns, ships, and aircraft to meet the ravenous requirements of a protracted war.

"We absolutely don't have the capability to move rapidly to mass production of some critical weapons systems," says Rep. David F. Emery (R) of Maine, a member of the panel that probed the nation's defense industrial base. "If we needed to produce a vast number of tanks in a short period of time, we simply couldn't do it."

In testimony to the full committee, Harry Gray, chairman and chief executive of United Technologies, the nation's third-largest defense contractor, added that in the event of a "national emergency" it might take two years before there would be any "real increase" in the output of war materiel.

The House panel attributes this state of affairs to several disturbing trends:

* The shrinking of the nation's defense industrial base.

* Dramatically lengthening lead times for weapons systems.

* Critical manpower shortages.

* Increasing dependence on foreign sources for critical raw materials and specialized components.

* The loss of world markets.

* Lagging productivity, and outdated defense plants.

"In 1978, normal lead times for one of our military jet engines was 19 months ," Mr. Gray told the investigating panel. "Today, the Air Force has to order that engine 41 months before delivery." Bottlenecks are the culprit, the panel concludes -- many caused by the closure of forging and casting facilities.

"During the 1970s, literally hundreds of foundries closed as a result of environmental, health, and safety laws and regulations imposed by the federal government," it reports.

According to Gen. Alton Slay, former commander of Air Force Systems Command, the US is more than 50 percent dependent on foreign sources for more than half of the 40 minerals most essential to its economy.

Claiming that only three-tenths of 1 percent of the total US landmass has been mined since 1780, General Slay asserted that there are currently 80 different laws administered by 20 federal agencies that effectively discourage any expansion of the domestic mining industry.

The House panel makes a number of recommendations in its report on reinvigorating the defense industrial base. To meet the problem of inflexible government contracting procedures, for instance, it proposes greater use of multiyear contracting, which, according to Gen. Bryce Poe, commander of air Force logistics command, obviates "annual start-up costs, preproduction testing costs, make- ready expenses, and phase-out costs" associated with weapons systems.

In requesting that Defense Secretary Caspar Weinberger address the findings of the report during coming defense posture hearings, the panel may be attempting to deter inaction on the problems it outlines.

But it would appear to have little cause to worry. "The industrial base is certainly one of the highest priorities that this new administration is going to work on here in the Defense Department," says one defense official. In fact, he insists that a "master plan" has already been forged to deal with its problems.

"It's kind of like what Abigail Adams said when she first came to Washington: 'It's capable of every improvement,'" he declares. Noting that a sound defense industrial base is a good deterrent, the official insists that the master plan is "truly action-oriented," adding, "We think it's time to shoot the engineer and get on with some programs, especially in the raw materials area."

Just in case, though, the House Armed Services Committee will be monitoring the problem, says Representative Emery, and may hold more hearings on it later in the year. But he is confident that both White House and Pentagon are alert to the plight of the nation's defense industrial base and he believes a program to return it to soundness "will be in place by the end of the year."

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