Concern over the erosion of the U.S. defense industrial base has prompted demands that the United States reduce its dependence on foreign sources for military material. Such dependence, it is argued, constitutes a national security vulnerability. Huge trade deficits and the movement of many non- defense manufacturing jobs offshore give such arguments considerable support.

It is eminently reasonable to support an increase in U.S. manufacturing capacity and a reduction in our trade deficits. A strong economy is a necessary condition for national security as well as overall social well- being. However, we should be cautious about justifying actions to reduce or eliminate foreign purchases on national security grounds. There is a danger we will overreact.Not all material purchased abroad, nor indeed all upon which we are dependent, necessarily leads to national security vulnerabilities. Developing good policies on this vital matter requires a common understanding of the nature of the foreign vulnerability problem in today's global economy, the options that we have to deal with it and the implications of these options.

Currently, concerns about dependence center not on major military systems but on their component parts: integrated circuits, optical materials, ball bearings and fasteners. The United States buys many of these items abroad. We are dependent when we cannot make these items in the United States. But many of the items we buy abroad could be purchased here. We chose not to do so for reasons of cost or quality.

Some items are not made here and in those cases the United States has a foreign dependence. The claim that this constitutes a national security vulnerability, however, is based on special assumptions. It posits a cutoff of a critical item or technology at a critical time. If an item is available from several foreign sources it is a vulnerability only if we believe we may be cut off from many, or all, sources at the same time. If it comes from a key ally, saying we are vulnerable means we believe we will be cut off from that ally.

No one wants a dependence that is truly a vulnerability. Our military strategy seeks to deter war by maintaining sufficient forces and counts on the use of high-technology weapons to counter numerically superior threats. This strategy requires access to a strong and innovative industrial base.

But is eliminating our overseas dependence the best way to assure access to the best technology and manufacturing base?

An independent defense scientific and industrial base would certainly have advantages. The United States could operate without concern that allies, friends and others might withhold vital material or technology for political reasons and the country would be assured that it could build whatever weapons it needed in time of war.

But is defense industrial independence feasible? We are faced with an increasingly integrated world economy in which factors of production and marketing are spread around the globe. A recent study by the Aerospace Industries Association of America showed that this internationalization was taking place even in the aerospace industry, where the United States still holds a commanding lead. It is even more evident in other industries.

Maintaining the capability to build all our own material will cost more. And attempting to achieve independence can interfere with access to technology developed by our allies. Since the United States is no longer the only source of advanced technology, this might result in not having sufficient access to critical technologies or material in the necessary time frame.

Dependence and independence are two poles; one we wish to avoid, the other we cannot achieve. Interdependence lies somewhere between. The real world is increasingly an interdependent one. Our defense sector, a sub-set of our civilian base, is becoming more interdependent although still far less than the civilian sector.

While there are some acknowledged constraints from allies and friends upon whom we depend, in most situations in which we consider conflict possible, we believe we will have allies. We won't fight in Europe without allies, nor protect Japan unless the Japanese help. Why should we totally discount their scientific and industrial bases?

An interdependent world has opportunities as well as vulnerabilities. The flip side of the dependence coin is that the United States is blessed with allies that have powerful scientific and industrial bases. A scientific and industrial alliance surely forms a more powerful deterrent force for security than a single country's base. However, it also presents the commercial challenges we see in our trade deficits.

Our policy challenge is to deal with these commercial challenges while maintaining our cooperative defense condition - a condition we might call competitive cooperation. A viable defense acquisition strategy in an interdependent world should set quality standards and accept bids from all

qualified sources, American and allied. It should manage the risks, as some sources are vulnerable and must not be used. And it should demand allied reciprocity. The effort to reduce defense vulnerability must be cooperative.

The growing economic integration of Europe, and the challenges of Japan and the Pacific Basin, demand flexibility and common sense if we are to gain the advantages as well as eliminate the vulnerabilities of foreign dependence. Pursuing a flexible, interdependent approach will be difficult, but in the end better for national security.

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