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Defense Contracts

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* I would like to clarify two points regarding Lee Feinstein’s recent article, “Big Military Contractors Go on the Defensive” (Opinion, Aug. 1).

First, the Administration has not yet determined the suitability or efficacy of government-backed loan guarantees for defense exports. The Defense Department is currently evaluating loan guarantees as one of several possible tools to help defense contractors remain viable as U.S. military needs decline.

Second, if the Administration were to support loan guarantees in the future, the funds would not be diverted from defense conversion. That $20 billion budget is spelled out in a March 11 summary of the President’s Defense Reinvestment and Conversion Initiative, and the President remains committed to full funding of that initiative.

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JOHN M. DEUTCH

Undersecretary of Defense

Washington

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