Defense Planning and Budgeting

The Issue of Centralized Control

by James R. Schlesinger

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An examination of the revolution in defense management that began in 1961 with the appointment of Secretary of Defense Robert S. McNamara. One of the most significant institutional modifications was the introduction of the program budgeting system characterized by (1) a format in which plans and budgets are presented in terms of programs and program elements; (2) extensive use of special papers and cost-effectiveness analyses to provide additional aid in deciding how resources should be allocated among programs and program elements; and (3) bookkeeping devices for checking on the Services and Commands to make sure that OSD allocations and decisions are being implemented. Hypothetical effects of the new degree of centralization introduced into the system, and the impact of the new procedures in specific decision contexts, are discussed. (To be published in the monograph series of the Industrial College of the Armed Forces for use in its instructional program.)

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