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In conclusion Secretary Quarles pointed out that the three
services in presenting their individual add-on programs would do
80 1.3 8 result of individual appraisal of the needs of each of
the services by that service. The total of the resulting sums
would, Secretary Quarles thought, doubtless be well in excess of
what we judge to be feasible in the light of our overall fiscal
situation. Accordingly, at the next Council meeting on this sub-

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ject, Secretary Quarles indicated that the Department of Defense

would be in a position to present a Defense Department package

containing the approved add-on programs as opposed to the individual

service estimates of what was required by way of add-on programs.

When Secretary Quarles had concluded his portion of the presentation, the President pointed out that Secretary Quarles had
made mention that the Department of Defense as such was taking over
direction of all the satellite programs. Secretary Quarles had then
proceeded to mention the program for achieving an Air Force recomnaisance satellite. Did this mean that the Defense Department was
not taking over direction of all satellite programs?
Secretary McElroy assured the President that all such programs
would be taken over from the individual services by the Department
of Defense. He then called upon Secretary Brucker to discuss the
FY 1959 Army program.

Secretary Brucker indicated that both he and

General Taylor would deal with this subject. General Taylor first
exhibited a chart entitled, "Application of Resources within Expenditure

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Ceiling of 8.6 Billion for FY 1959".

After explaining the application

of resources, General Taylor stated his strong agreement with the comments of earlier speakers as to the seriousness of reducing Army deployments and capabilities in Western Europe and in Korea. General
‘ Taylor felt that there were three serious problems. The first was the
reduction of Army overseas deploymente, the second was the reduction
of mobile strategic divisions at home in the U.S. and the third was
the slow Prognses in the development of continental defense. If these
problems could/be satisfactorily solved, the U.S. Army and our Allies
would find themselves at a serious disadvantage vis-a-vis the USSR
as the military capabilities of the latter continued to increase.

Secretary Brucker first spoke of the decline in the Army's
operational capabilities which would result from significant reductions
in money available to the Army. He illustrated his point with charts

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an

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chart indicating how under the FY 1959 Budget the Army's rate of modernization would decline,

In his summary Secretary Brucker strongly recommended a reversal
of the trends portrayed by the above-mentioned charts and asked for
supplementary resources for the Army in FY 1958 and additional appropri-

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ations in FY 1959.

He indicated a strong conviction that we should

retain our present NATO and Korean deployments.

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The Army also recommended

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REPRODUCED AT THE DWIGHT, D. BISENHQWER LIBRARY ~>

entitled "Ihe Decline of Available Money FY 1958-FY 1959" and a second

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