It looks as if the battle is joined: the defense budget vs. the balanced budget. President Reagan's vaunted defense buildup has collided with his promise to balance Washington's spending with income by 1984.
With a dceficit of $42.5 billion expected by his administration and $60 billion to $70 billion by more pessimistic observers, the President and his advisers are toying with the idea of paring the $1.5 trillion they plan to spend strengthening American armaments over the next five years.
It is no easy decision for the President, who believes that the biggest peacetime military buildup in United States history is necessary to deter Soviet expansionism. Nor is the decision easy for Defense Secretary Caspar Weinberger, who appears determined to prepare the nation's armed forces to fight two major and one lesser war against the Kremlin, should be need arise.
Analysts here feel that if military cuts are deemed vital, as much to counterbalance cuts in social programs as to balance the budget, they wil be kept to an absolute minimum -- not simply because the President ousted Jimmy Carter in part by criticizing his supposedly poor defense record, but because the administration has been critical of reduced defense spending in the NATO alliance.
Budget Director David Stockman says that teh Pentagon "may have to do more" to reduce its costs. "I don't think there is any budget within the federal government that can't be squeezed," he observed after conferring with Secretary Weinberger and presidential counselor Edwin Meese in California earlir this week.
Though he declined to say whether military funding will be cut back, he believes there is "fat in every agency" to be trimmed. "We have $44 billion to find throughout the government," he said. "We're in the process of deciding where to find it, what programs, what agencies have to take the cut." He added that he believed Mr. Weinberger was in agreement with those who fell the Pentagon will have to bear its share of cuts.
Neither the Defense Department nor the Office of Management and Budget would comment on the possibility of cuts in military spending.
Secretary Weinberger would doubtless object to anything drastic, but sympathizes with Stockman's predicament. "I understand perfectly what Dave's problems are, because I had them once myself," declares the Pentagon chief, who served as budget director under President Nixon.
Weinberger, who has to satisfy service chiefs clamoring for cash, denies he has had any falling-out with Stockman over the question of defense cuts. In fact, he is known to be receptive to the argument that a strong economy is the nation's first line of defense.
If cutbacks are forced on the Pentagon, a number of projects might be reduced or axed entirely. According to a defense analyst, who asked to remain anonymous , the Army's infantry fighting vehicle is a prime candidate for pruning. The cost of each vehicle has ballooned from $900,000 to $1.8 million.
Another target might be the Navy's F-18 fighter, built by McDonnell Douglas. This project has suffered from design and engineering problems, not to mention a fair dose of inflation.
Instead of a $16 billion price tag, the 1,377-plane program is now estimated to cost nearly $38 billion. Sources say the Pentagon has been reassessing the F-18's future for some months now.
According to reports, US defense planners are intrigued by the possibility of saving money by creating a single missile that could be used both as a new, ground-based strategic weapon and as a submarine-launched one. This common missile, as it is called, would replace MX, besides equipping the Navy's Trident submarines, and would reportedly be fashioned from parts of the existing MX and Trident II missiles.
But the authoritive magazine Avaition Week & Space Technology this week looks askance at the scheme. Editor in chief William H. Gregory notes that a study during the Carter years "found that the first-blush cost savings from such a program did not stand up in the real world of program management." Besides, he writes, "there are myriad technical problems in trying to develop commonality for ground and sea basing and myriad management problems in a dual program."
Sources here point out that some defense cuts could give the Pentagon a leaner, more effective establishment.