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planning programming and budgeting system and our economy

Some may be familiar with the planning programming and budgeting system set up by rand corp. its our counterpart to the soviets five year plans. Im trying to get your thoughts on how much of an impact this had on our financial mess, derivitaves etc. the below article is taken from the don bell report published sept 1972. Bell was a korean Pow before he published this.

2o.s Bell Reop4/s
Year Nineteen Number Thirty-Eight September 22, 1972
Part Three
In Science magazine, February 5, 1971, there
appeared an article by Karl Deutsch, John
Platt and Dieter Senghass of Harvard University,
which states that four of the most
important political achievements in this
century are :
1. Soviet type of one-party state, developed
by V. I. Lenin, 1917-2 1 .
2. Large-scale nonviolent political action,
M. K. Gandhi, 1918-34 .
3 . Peasant and geurilla organization and
government, Mao Tse-tung, 1929-49 .
4. Cost benefit analysis (PPBS),
Charles Hitch (1956-63) .
These political achievements are described
bs political administrative techniques.
It was Charles Hitch who developed the
Planning-Programming-Budgeting System at
RAND Corporation, then joined Robert S .
McNamara to install the system in the U.S.
Department of Defense . Hitch later was
transferred to the presidency of the University
of California, to assist in installing
PPBS in the California school system .
In regard to the four political administrative
techniques listed above, it should be noted
that each is a new development for the
control of people.
The Soviet "one party state" is not a
political development as we know such in
the United States ; for the Communist Party
is not a political party in the true sense of
the word ; rather it is a monopolistic minority
group which forces its will upon the
majority of the citizens of the USSR . Under
this political administrative system, a small
self-proclaimed elite monopolizes all the
power of the state so that it can create the
environment which will allegedly perfect
human nature and result ultimately in a perfect
society . Monopoly control by a small
elite : this was Lenin's contribution toward
the building of the New World Order. And
it was simply a system of people control .
Gandhi's contribution had to do with the
control of people through peace ; Mao Tsetung's
contribution was for the control of
people through violence ; and Hitch's P PBS
is for the control of people through planning
and programming through the coercive use
of the budget - the power of money being
used for the purpose of creating a New
Society (which includes the programming for
the creation of a new man who will fit into
the preplanned pattern peacefully and contentedly
The use of the acronym PPBS, with its accent
on "Budgeting," would seem to indicate
that this was merely a new system of
accounting, and nothing more . In fact, this
was the assurance usually given all the
dubious and the skeptical who opposed the
installation of PPBS . However, as a mere
accounting system, PPBS was a failure from
the very beginning :
PPBS was given its trial runs, not within a
government agency, but in certain privatesector
corporations (forecasting the desire
of the Elite Planners to convert this Nation
into a Corporate-Fascist-State .) PP BS
first tried out at the expense of the Ford
Motor Co ., in its Edsel Manufacturing Department,
under the managership of Robert
Strange McNamara, with farcical results .
The PPB System also was tried out with the
Penn-Central Railway, and that corporation
was taken over by the Government . It was
installed at multinational Rolls Royce, and
that corporation went into the hands of
receivers. Men who helped perfect PPBS at
RAND joined the executive staff of the
multinational conglomerate, Litton Industries
in an attempt to make the system work
at the corporate level in a competitive economy-
and Litton lost $14 million in its last
reported fiscal quarter . Etc ., etc .
In other words, PPBS was clumsy, costly,
ineffective; yet it was considered to be so
successful administratively that it was
adopted by the Executive Branch of our
Federal Government, installed first in the
Defense Department and later in all Departments.
(If you agree that our conduct of the
Vietnamese War has been a most miserable
failure, remember that it was conducted under
Charlie Hatch's Planning-Programming-
Budgeting System!)
Even though PPBS has been an abysmal
failure wherever tried at the corporate level,
Rand Corporation executives and spokesmen
are still working overtime trying to "sell"
the system to every large corporation in the
country. As an example, we have the photostat
of an article written by L . A. Dougharty,
of the Cost Analysis Department of Rand
Corporation, titled : "Developing Corporate
Strategy Through Planning, Programming,
and Budgeting ."
Because we are dealing with "proofs of a
conspiracy," it is necessary to reproduce
some of their words and their presentations .
And because Mr . Dougharty gives the Rand
Corporation description of how the United
States Government uses PPBS, we reprint
pertinent parts of the Dougharty article,
together with a table showing how PPBS
has been adapted as a "Seven-Year Plan"
by the Federal Executive:
* * * * * * * * * * * *
. . . the corporation needs a planning framework
that aids in clarifying objectives, identifying
the alternatives open to the firm, and
measuring the effectiveness of those alternatives
toward the attainment of the objectives
of the corporation. To cope with this
problem of integrating objectives with resources,
. . . the Government of the United
States-the biggest conglomerate of them all
-is employing what is termed "Planning,
Programming, and Budgeting (PPB) ." . . .
Table I presents a programme structure for.
the U .S. Government . It illustrates how the
resources of the government (measured in
dollars, are allocated to the various broad
programme areas such as National Defense,
Education, etc .
Under each broad programme area, the programmes
of the government agencies that
contribute toward the attainment of the broad
area objective would be arrayed . Education
programmes, for example, would be arrayed
under the Education category, rather than
under the sponsoring agency . Selecting from
among the competing programmes in eacl
broad programming area involves the second
aspect of PPB-the analytical part . Analysis
is shorthand for a variety of quantitative
techniques for exploring the cost and effectiveness
of programme proposals over an extended
time period (seven years-Ed .) The
most prominent example of the use of PPB
is in the United States Department of Defense,
where the new planning structure
clarified objectives in defense and pinpointed
weaknesses in the then current
strategy for defense . . . .
In the case of the Department of Defense,
the programme categories that reflect the
military objectives of the United States are
set by the Department and not by the services
. . . . The transition of the PPB concept
used in government planning to corporate
planning is not difficult to make. The
parallel between business and war is
remarkably close, so it is not surprising
that planning techniques of the two can be
quite similar . . . .
(End of quotation)
In connection with the above, the Rand Corporation,
which designed the PPB System
used by the Defense Department, affirms
that the entire responsibility for the PPBS
operation must reside with one person at
the top. "No one at a lower level has the
authority or the right or the ability to
acquire the knowledge required to perform
the necessary tasks . . . " says Rand. This
will explain why General Lavelle-and perhaps
other Generals-are in trouble over the
"unauthorized" bombings in Viet Nam . The
general officers at the lower level had not
"the authority or the right or the ability"
to make an on-the-spot decision, even
though such a decision might save thousands
of lives!
Randman Dougharty, in the above article,
writes only of the use of PPBS in the
Defense Department. However, Table I,
which he uses to illustrate his article, does
show its application, not to departments and
agencies of the Executive, but to programme
areas. Hence, we see appropriations budgeted,
not to the State Department as one
unit and the Treasury Department as another
unit of the Executive Branch. Rather, they
are combined in one "programme area" and
the appropriation is voted by Congress for
the area of "international affairs and fiTABLE
nance ." Commerce and Transportation are
two separate and distinct Cabinet Departments
; yet they are linked together in the
budget . Likewise Health, Labor and Welfare;
while Education is separated from
H.E .W. and made a programme area all by
itself alone, though each Department will
spend a part of its funds on one or more
areas of education! Thus, Congress loses
the ability to know how much money is being
used for what, and loses all control
over Administration expenditures! Only the
"one person at the top" knows how the taxpayers'
money is being spent. And, as presently
set up, that "person at the top" is
the director of the Office of Management and
Budget, whose name is Caspar W . Weinberger,
whose assistant director of OMB is
S. M. Cohn, and who, with Arthur Burns of
the Federal Reserve, and Henry Kissinger
of the White House, make up a Governing
Troika of appointed-not elected-rulers of
these United States . In effect, they are not
representing the people or the States, even
though they do receive their appointment
from the President of the United States .
Rather, they are the chosen agents of that
Elite Minority Group which has determined
to build a total, managed, global society .
To attain that goal, PPBS has been perfected
and installed in the Federal Government.
It is a totally interrelated management
system, wherein the planning, programming,
and budgeting components are interdependent
and inseparable within the system, and
whereby each subsystem, or separate function
of government (education, health, welfare,
labor, defense, etc .) is linked to-
Source : "The Federal Program by Function," The Budget of the United States Government, 1969,
U.S. Government Printing Office . Washington, D.C . 1968.
gether into a total national system . The
entire framework is then managed from "the
executive head ."
And this "executive head" manages the
System from and through the Office of
Management and Budget!
As a part of the documentary proof which
has been collected and forwarded to us, to
sustain such charges, we have a copy of an
official Bulletin, a part of which we shall
Washington, D .C . 30503
Bulletin No . 68-9
April 12, 1968
To The Heads Of Executive Departments
And Establishments .
Subject : Planning-Programming-Budgeting
(PPB) System .
1 . Purpose and Scope . This Bulletin contains
guidelines for continued development
of integrated Planning-Programming-Budgeting
(PPB) Systems and outlines requirements
for PPB submissions to the Bureau .
. . . This Bulletin applies to . . .
Department of Agriculture
Department of Commerce
Department of Defense
Department of Health, Education, and Welfare
Department of Housing and Urban Development
Department of the Interior
Department of Justice
Department of Labor
Planned budget allocation
Programme area 1969 1970 1971 1972 1973 1974 1975
I . National defense
II . International affairs and finance
III . Space research and technology
IV. Agriculture and agricultural products
V. Natural resources
VI . Commerce and transportation
VII . Housing and community development
VIII. Health, Labor and welfare
IX. Education
X. General support
Tota I xx xx xx xx xx xx xx
Post Office Department
Department of State
Department of Transportation
Department of the Treasury
Agency for International Development
Atomic Energy Commission
Central Intelligence Agency
General Services Administration
National Aeronautics and Space Administration
National Science Foundation
Office of Economic Opportunity
Peace Corps
United States Information Agency
Veterans Administration
(The following) agencies will be contacted
by the (Budget) Bureau with respect to the
extent of required compliance to the guidance
provided in this Bulletin . . .
Civil Service Commission
Federal Communications Commission
Federal Home Loan Board
Federal Power Commission
Federal Trade Commission
Railroad Retirement Board
Securities and Exchange Commission
Small Business Administration
Tennessee Valley Authority
(End of quotation)
The foregoing list is taken from a 20-page
set of originally typewritten, single-spaced
instructions explaining to department heads
why PPBS is important, and how they are
to cooperate by submitting to the executive
office at stated times certain tabulations,
financial requirements, programme suggestions,
special analytical studies, etc. The
Bulletin is written in bureaucratese, but a
few statements stand out :
"The budget is the financial expression of
the underlying program plan . Review by the
(Budget) Bureau is conducted primarily in
program terms . . . . To meet Bureau needs,
agency PFP submissions are to present
specified data on outputs, costs, and financing
over a seven-year period. . . . Responsibility
for the development and use of
PPB systems rests with the head of each
agency . Agency heads are required to take
such action as is necessary to insure that
line managers participate in operation of
the PPB system . .. . Agencies are encouraged
both to make use of the various training and
educational programs offered through the
Civil Service Commission, and to establish
internal orientation and training courses as
appropriate ."
After PPBS was installed in every executive
"department and establishment," other
necessary steps were taken . First, the Budget
Bureau was "restructured," expanded,
and made a Management Bureau as well; as
the new name affirms : "Office of Management
and Budget."
Next, plans were made, and finally completed,
for the dividing of the Nation into
Ten Regions, with Ten Regional Capitals
where Regional Councils meld together all
separate departments and agencies and then
govern their regions, not according to department
or agency category, but according
to societal programme area .
An essential part of this programming is yet
to be completed : the restructuring of the
Presidential Cabinet Departments into four
departments, to make "area functioning"
less complicated .
Also in process of completion are three
important steps in the area of budget and
finance : 1) Installation of the Revenue
Sharing Program; 2) Imposition of personal
Income Tax Laws in every State in the
Union, and arrangements for collection of
same by Federal-not State-tax collectors ;
and 3) Transfer of all bonds, securities and
"public money" held by counties, cities and
incorporated communities, to central Federal
Reserve Banks, where such funds and
securities will be held in "special custody"
by the Feds.
Meanwhile, the 1313 Organization launched
a pilot project to introduce PPBS at the
State, County, and City level .
And most important of all : The Planners
began working more than three years ago on
a PPBS operational model for the public
schools, where it will be used to produce
the "new man" trained to fit properly into
the total, managed, global society .
These are some of the "programme areas"
to be explored in upcoming letters .
(To Be Continued)
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