Mr. MAHON. I want to thank you for your statement, Mr. Secretary. We will proceed with the statement of Admiral Sherman. BACKGROUND AND EXPERIENCE OF ADMIRAL SHERMAN Admiral Sherman, I think the record should show your background and naval experience. Will you give us a statement as to your naval experience and background? We would appreciate it. Admiral SHERMAN. I graduated from the Naval Academy in 1917. I went immediately to the Mediterranean and served there for a year in a gunboat and destroyers based at Gibraltar. Then I spent a year on the coast of France as chief engineer of a destroyer. Then I served in various battleships and destroyers until 1922, when I became a naval aviator. I served in various fighting squadrons at various times, and was at one time in charge of fighting plane instruction at Pensacola. I served in the Lexington, Saratoga, Langley, and Ranger. Mr. ENGEL. In what capacity? Admiral SHERMAN. I was an assistant air officer in the Lexington when she went into commission. I served in the Saratoga as squadron and wing commander. I served on the staff of the Commander Aircraft in the Pacific on two occasions. I was with Admiral Yarnell as gunnery and tactical officer. I was with Admiral Butler as flag secretary. I became force aviation officer on the staff of Admiral Bloch, and later fleet aviation officer on his staff. I graduated from the Naval War College in 1927. My Navy Department experience during that same period was 3 years in the Bureau of Ordnance as Chief of the Aviation Section in that Bureau. In January of 1940 I came ashore and was in the War Plans Division of the Office of the Chief of Naval Operations, with additional duties on the Canada-United States Defense Board. I acted as naval air adviser at the Argentia Conference. At the beginning of the war, I was assigned as a member of the Joint Strategic Committee, which was the first full-time joint planning agency established in our country. I went to sea in April of 1942, and took command of the carrier Wasp. I commanded her until she was sunk in the South Pacific in September of 1942. I then served approximately 1 year as chief of staff to Admiral Towers, Commander Aircraft, Pacific Fleet. I then went with Admiral Nimitz and I was his deputy chief of staff, responsible for plans and operations until September of 1945. I represented the Navy at the initial surrender conference in Manila in August 1945. I was then assigned briefly in command of Carrier Division 1, and in December of 1945 I became Deputy Chief of Naval Operations, for Operations. I left the Navy Department in January of 1948, and commanded the Sixth Fleet in the Mediterranean until I came to Washington at the end of October; and on the 2d of November I asumed my present duties. Mr. MAHON. Thank you, Admiral. STATEMENT OF ADMIRAL FORREST P. SHERMAN Admiral SHERMAN. Before discussing the approved Navy Department budget for the fiscal year 1951, it will be helpful to review briefly the major changes in the size and character of the Naval Establishment since September 1945. In September 1945 the Naval Establishment included 8,1491 ships, 23,880 operating aircraft, 335,471 naval officers, 2,926,252 naval enlisted, 37,664 marine officers, and 443,647 marine enlisted. The Navy had on hand ships which had cost about $22,000,000,000, shore establishments which had cost about $7,000,000,000, and equipment and supplies including aircraft which had cost about $12,000,000,000; a total investment of about $41,000,000,000. During the ensuing 12 months the fleets were quickly demobilized and we attained a strength of about 3,763 ships and of about 500,000 naval enlisted, with other personnel in proportion. From September 1946 to the spring of 1948 the operating forces were gradually contracted with consonant reductions in personnel. During the same period inactivation or disposal of shore facilities proceeded in an orderly manner, although much more slowly than the inactivation or sps and the release of naval personnel. From the spring of 1948 to the summer of 1949 there occurred a period of expansion during which plans for the operating forces were revised upward, and there were actual increases in various categories of the operating forces and of naval personnel. For example, the planned strength in large carrier air groups was 14 in fiscal year 1947, 11 in fiscal year 1948, and 24 in fiscal year 1949 (although the strength of 24 was not actually attained). The appropriations for 1950 again envisaged a shrinkage from the 1949 level and those recommended for 1951 a further shrinkage. Actually, as you know, decisions were made early in fiscal year 1950 to reduce during 1950 to the levels planned for fiscal year 1951. Again using the example of the larger carrier air groups, this involved a reduction from the planned 24, actually about 16, in fiscal 1950 to the figure of 9. Fluctuations in plans for operating ships were less marked but tended to follow the same pattern. I would like to interject at this point an amplification of the effect of the planning for 24, although only 16 groups were actually reached. The point is that aviation personnel was put in training for the planning figure of 24, and because the period of training lasts a year and a half, some of that planned expansion is still with us in terms of pilots who are completing training at this time. I bring this out to show you the after effects of an expanded plan, even though the plan is subsequently cut back. Mr. PLUMLEY. Are they still available and usable? 18,149 commissioned and in service vessels comprised the following type: Major combatant_. Minor combatant. Fleet train (includes tenders, supply transports, large landing craft). 803 1,738 4, 548 1, 060 Total_ 8, 149 Admiral SHERMAN. The pilots are very valuable, sir. They are going to be the new blood which goes into the Naval Air Reserve. Thus, it may be seen that the Naval Establishment as it now exists reflects a year of demobilization, a year and a half of shrinkage, about a year of moderate expansion, and about a year of rapid cutback. These conditions have left certain features which are less efficient than might otherwise be the case. In general the shrinkage of the shore establishment during the early postwar years lagged behind the shrinkage of the active operating forces. During the current fiscal year much more rapid progress has been made. During the past 42 years the book value of the shore establishment has been reduced by an amount estimated at roughly one billion dollars and the equipment in hand by roughly ten billion. To the degree that the naval service has been maintained by material bought during the war, its operations must be decreased in the future, or maintenance funds must be increased, or there must be readjustment within the over-all structure. POLICIES FOR GUIDANCE OF THE DEPARTMENT OF THE NAVY All of the foregoing considerations plus a requirement to bring the 1951 estimates within a fixed ceiling led the Secretary of the Navy on September 23, 1949, to approve the following policies for the guidance of the Naval Establishment: (a) Within the limitations imposed by budgetary and manpower ceilings every effort will be made to maintain the operating forces of the Naval Establishment in the highest possible degree of readiness for the immediate execution of the roles and missions which have been assigned as the principal responsibility of the Navy. (b) In the expenditure of manpower and funds, maintaining the readiness of active naval forces to accomplish the Navy part of the national basic undertakings and defensive tasks common to all war plans and to initiate the Navy's offensive work under currently approved strategic concepts is paramount. Expenditures for the Shore Establishment must be the minimum required to provide absolutely essential support for the active fleet and for early, high priority mobilization requirements. All other expenditures in support of mobilization requirements must be subordinated to the foregoing. (c) All shore activities not essential for the peacetime support of the operating forces, for approved Research and Development projects, and for early mobilization requirements must be completely inactivated and, if possible, eliminated. (d) All shore activities presently inactivated will, unless urgently needed for support of early war operations, be declared surplus and disposed of by sale, lease or permit, with the application of the national security clause, as may be appropriate, in order to reduce the personnel required for their retention and and security to a minimum. (e) All shore activities which are presently in a maintenance status will be carefully evaluated for inactivation and, wherever possible, disposed of, as described under paragraph (d). (f) As a calculated risk in order to provide funds to maintain essential active naval forces, the quinquennial overhauls of all Reserve Fieet vessels will be canceled, and only docking and the work required for inactivation and preservation will be provided. (g) All reserve fleet vessels will be further screened for obsolescence and for such disposal as appears appropriate under the new manpower ceiling. No further work nor funds will be expended for the maintenance of vessels so recommended for disposal. (h) All district craft, landing craft and boats which are presently inactivated will be further screened for such disposal as appears appropriate. (i) No Bureau of Ships alterations,, Bureau of Ordnance alterations, nor other modifications to equipment or spare parts to be carried in stock will be permitted unless it is certified that the equipment or spare parts are required for installation in vessels of the active fleet and the accomplishment of the work is approved by the Chief of Naval Operations. (j) The overhaul of aircraft engines and accessories will be maintained at the level necessary to insure flight safety and combat readiness of operating forces plus those reserve stock combat aircraft essential to meet prospective deficiencies in new production. (k) The manufacture of equipment and spare parts will be limited to those items and amounts considered essential for the support of the operating forces. (1) The program for the rehabilitation and storage of all equipment and supplies in excess of (a) that are essential for the support of the operating forces, and (b) that which, after rescreening, is reapproved to be carried as war reserve, will be cancelled, and the material disposed of in accordance with existing instructions. No work nor funds will be expended on such material, except in the interest of disposal. The work and funds expended for disposal will not exceed a predetermined minimum percentage of the book value of the material. SURVEY OF SHORE ESTABLISHMENTS I am not yet satisfied with the results obtained in following the foregoing directive, but am confident that these policies are sound and will result in increased efficiency as their effects increase. At the present time the shore establishment is being surveyed by four on-site survey parties functioning under the authority of the Chief of Naval Operations with the objective of effecting all practicable consolidations, reductions, and economies. Substantial economies have already been effected, which have permitted the diversion of men and money to the active fleet and its essential support. The Secretary of the Navy has approved the indefinite continuance of this activity by the Inspector General of the Navy, and on completion of the current surveys the staff of the Inspector General will be appropriately organized. BUDGET FCR 1951 Our approved requests for fiscal year 1951 amount to $3,881,432,000 new obligational authority, of which amount $475,496,000 is for new contract authority largely for new aircraft, and $124,797,000 is fiscal year 1950 contract authority to be made available in fircal year 1951. With this amount of money it is proposed to employ 459,030 active duty military personnel, of which 384,593 will be naval personnel and 74,437 will be Marine Corps personnel. There will be a total of 653 active ships, of which 239 will be major combatant types, manned on an average at 67 percent of war strength. The Marine Corps personnel will provide a Fleet Marine Force of two divisions at 31.4 percent of their wartime strength. While we had provided for two marine divisions in 1949 and 1950, their respective strengths were in 1949, 47.7 percent and in 1950, 35.7 percent. The Fleet Marine Force will find it most difficult at its reduced fircal year 1951 strngth to accomplish its initial wartime tasks as set forth in present plans and still provide the necessary cadres for mobilization purposes. It is planned to organize the ground components of the Fleet Marine Force in such a manner that within the existing two divisional structures and under the fiscal year 1951 manpower and monetary ceilings, there will be constituted the strongest possible combat elements, by all practicable means, including drastic reduction in supporting units. Within the estimate for fiscal year 1951 we will be able to operate a total of 4,389 Navy and Marine Corps airplanes in the active forces, and 1,844 in the Navy and Marine Corps Reserve. This represents a reduction of approximately 20 percent from the 1950 appropriation figure. COMPARISON OF FORCES IN 1950 WITH 1951 The details of the forces with which the Navy is preparing to perform its tasks in 1951 are indicated in the table below, together with comparisons with the forces for which money was appropriated in 1949 and 1950. Although a continuing shipbuilding program is necessary to the maintenance of a modern Navy, the approved Navy's fiscal year 1951 estimates have made it necessary to restrict shipbuilding and conversion expenditures to a level of about $300,000,000. We are requesting no new contract authorization for shipbuilding or conversion in the fiscal year 1951. The funds provided in this budget for shipbuilding and conversion are sufficient only to continue the existing |