306


FOREIGN RELATIONS, 19 5 0, VOLUME I


creased taxes and a curtailment of domestic programs. This seems
hardly a program for stimulating economic growth. It is suggested as
a general guideline that any security program which requires either a
significant increase in the tax base or the -curtailment of domestic pro-
grams which have an investment or developmental effect, should be
considered as raising serious questions on the economic side.
   No course of action is without risks, but the risks in the proposedi
 course are not adequately considered. The type of military program
 seemingly implied on pp. 54-55 ' most certainly raises serious ques-
 tions. This is even more true of -the document as a whole which appears,
 basically, despite general statements in other directions, to point.
 down the road of principal reliance on military force which can only
 grow in its demands over time, ,as well as scarcely fail to lose the
 cold war.
                                                   WLIMF. SCIAB

  'See P. 282.
Policy Planning Staff Files    .
1emnorandum, by Mr. Hamilton Q. Dearborn of the Council of Eco-
   nomic Advisers to the Executi e Secretary of the- National Security
   Council(Lay)

 TOP SECRET .WASHINGTON, May-8, 1950..
 Subject: Comments on NSC 68
   This memorandum is prepared in response tothe Committee'decision
of May 2 that NSC 68 should be further considered at a meeting on-
May 9, and that written questions and comments should be prepared-
as a basis theref or.
  Three basic questions are raised by NSC 68:_
  1) The adequacy of the intelligence data and analysis on which rest-
the conClUsions as to the current status of, and trends in, the relative-
strength of the United States and the Soviet Union;
  2) The degree to which the policy conclusions of NSC 68 are-best,
adapted to remedy the deficiencies disclosed by analysis; and
  3) The best programs, and their cost and economic significance,-
for implementing those policy conclusions, or alternative policy
conclusions.
T'he B asic Intel.ligence Data, and Analysis
  The -major analytical conclusions drawn are the following:
  Concerning direct military strength:
  1. "Unless the military strength of the Western European nationsý
is increased on a much larger scale than under present programs and
at an accelerated rate, it is more than likely that those'nations will_