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For the present, Nixon is relying on a combination of innovation and financial surgery to balance his budget. Items: DEFENSE. Despite the high cost of the Viet Nam War, the Pentagon took by far the largest cutback. For fiscal 1971, proposed military expenditures were cut to $71.8 billion, 12% below the current level. In his biggest saving, Defense Secretary Melvin Laird is dropping 299,000 military personnel during the current fiscal year and another 252,000 next year. Many weapons systems will also get less funds. Outlays for the Air Force's giant C-5A cargo plane were trimmed $285 million, for example, by slicing the order from 115 planes to 81. President Nixon's decision to expand the Safeguard missile-defense system, however, will lift anti-ballistic missile outlays from $892 million this year to $1.5 billion in 1971. This provides for expansion beyond the two ABM sites previously authorized.
SOCIAL WELFARE. Reform of the old and research on new methods dominate Nixon's approach. The cost of social-insurance funds will jump $6 billion, mainly because of the 15% Social Security increase voted by Congress last year over Nixon's original objections. The President's initiatives have more modest price tags—$500 million for a start on the family-assistance plan that would reform welfare standards nationally, $30 million more for cancer studies, $4,000,000 for a new family-planning program. Subsidized housing for low-income families is expected to soar from 377,000 units this year to 435,000 in 1971 (cost: $805 million).
THE ENVIRONMENT. In a surprise overhaul of federal aid, the President proposed the creation of an environmental financing authority to subsidize interest payments on municipal bonds floated to build local sewage-treatment plants. Details are still to be worked out, but the Nixon plan contemplates Washington's putting up $4 billion and localities $6 billion for construction over five years. The authority's main role would be to help localities that are unable to raise capital because of tight money.
OUTMODED PROGRAMS. A year-long effort by Budget Director Robert Mayo shows in Nixon's proposal to save $2.1 billion by killing or curbing a number of bureaucratic enterprises. Among them are hospital construction grants, the school milk program and veterans' burial benefits. Nixon is anxious to liquidate $750 million worth of surplus stockpiled commodities. Provided that Congress approves—a big if—most of the sale would involve aluminum and zinc, but the list also includes 1,850 Ibs. of opium, 555,729 Ibs. of excess feathers and 48 million Ibs. of castor oil.