;(lein (Huseum Copy) NATIONAL AIR AND SPACE MUSEt~ RAND CORPORATION JOINT ORAL HISTORY PROJECT ON THE HISTORY OF THE RAND CORPORATION EDITORIAL USE FORM PREFACE This manuscript is based upon a tape-recorded interview conducted by Dr. Ioseph Tatarewicz on August ]2. 1988 The tape and the manuscript are the property of ~he undersigned~ however, the originals and copies are indefinitely deposited, respectively, at the National Air and Space Museum of the Smithsonian Institution and at the RAND Corporation. I have read the transcript and have made only minor corrections and emendations. The reader is therefore asked to bear in mind that this manuscript is a record of a ~poken conversation rather than a literary product. Though the smithsonian Institution and the RAND Corporation may use these m~terials f~r their own purposes as they deem appropriate, I wish to place tt.· ':~ndition as selected below upon the use of this interview materia~ ~~. > thers and I understand that the Smithsonian Institution and the RAN~ Corporation will make reasonable efforts to enforce the condition to the extent possible. CONDITIONS (Check/one) \/! PUBLIC. THE MATERIAL MAY BE MADE AVAILABLE TO AND MAY BE USED BY ANY PERSON FOR ANY LAWFUL PURPOSE. OPEN. This manuscript may be read and the tape heard by persons approved by the Smithsonian Institution or by the RAND Corporation. The user must agree not to quote from, cite or reproduce by any means this material except with the written permission of the smithsonian or RAND. MY PERMISSION REQUIRED TO QUOTE, CITE OR REPRODUCE. This manuscript and the tape are open to examination as above. The user must aqree not to quote from, cite or reproduce by any means this material except with the written permission of the smithsonian or RAND in which permission I must join. Upon my death this interview becomes open. EDITORIAL USE FORM (CONT.) MY PERMISSION REQUIRED FOR ACCESS. I must give writen permission before the manuscript or. tape can be utilized other than by Smithsonian or RAND staff for official Smithsonian or RAND purposes. Also my permission is required to quote, cite or reproduce by any means. Upon my death the interview becomes open. (Signature) Dr. Burt Klein (Name, typed) 12/8/88 (Date) Klein, Burt. Date: August 12, 1988. Interviewer: Joseph Tatarewicz. Auspices: RAND. Length: 2 hrs.; 33 pp. Use restriction: Open. After briefly reviewing his upbringing, pre-World War II education in economics, and Army Air Forces training during the war, Klein discusses his work as an economist on the strategic Bombing Survey in 1945 and obtaining a PhD in economics from Harvard immediately after the war. He then describes working for the Council of Economic Advisors from 1948 to 1952, participating in a RAND summer study in 1950, and his initial work at RAND beginning in 1952 at the Development Planning Office in DCS/Development. Klein next reviews his impressions of systems analysis, heading a project studying USAF R&D and the reactions of different RAND personnel to it, assuming the leadership of the Economics Division in 1962, the growing difficulties between RAND and the USAF in the early 1960s, and his reasons for leaving RAND in 1965. TAPE 1, SIDE 1 1-3 Dr. Klein's early life and undergraduate education at Harvard (Joseph Schumpeter) 3-4 Graduate studies in economics 4-6 Army Air Forces duty in WWII; navigation training 6-8 Becomes Galbraith's assistant for OSS bombing damage survey 8 Employment at Council of Economic Advisors 8-9 Klein's PhD studies and dissertation TAPE 1, SIDE 2 10 PhD thesis 10-11 Employment at the Council of Economic Advisors; made a representative to National Security Council 11-14 Klein's split from the Keynesian tradition; contradiction between theory based on assumptions of stability in economy and reality of instability Issue of macro-micro relationship; impact on work at Council 14-15 First introduction to and impressions of RAND 15-18 Begins employment at RAND; on loan to Air Force Development Planning Office (General Bernard Schriever); Lockheed proposal for U-2 reconnaissance plane (Kelly Johnson); RAND Washington office 18 Klein transfers to Santa Monica RAND office TAPE 2, SIDE 1 19-20 Air Force R&D system, flexibility during Klein's AFDAP assignment 20-22 Klein's first impressions of RAND; systems analysis, and Klein's view of its utility, situations in which it is not useful: different views within RAND on systems analysis; U-2 development 22-25 Klein's R&D project at RAND to test empirically his criticism of systems analysis; superiority of Sidewinder to Falcon missile 25 Klein's criticism of Air Force approach to R&D; briefings of R&D study TAPE 2, SIDE 2 26-27 Briefings of R&D study (continued); Klein becomes head of economics department 27 Use of outside consultants in economics; interaction between economists within RAND and outside RAND on question of systems analysis 27-29 RAND attitudes toward Klein's R&D study; collegiality among RAND economists; Klein's experience as a manager 29-31 Pressure on RAND for accountability in early 60's; the manned bomber question; B-70 proposal; SOFS study; changing relationship between RAND and Air Force 32-33 American military attitude toward nuclear war post-WWII, contracted to other nations 33 Decision to leave RAND KLEIN-1 Interviewee: Dr. Burt Klein Interviewer: Dr. Joseph Tatarewicz Location: Dr. Klein's home, just outside San Diego, Calif. Date: August 12, 1988 TAPE 1, SIDE 1 Dr. Tatarewicz: On the biographical side, I know from a couple of little entries that appeared in American Men and Women of Science and in WHO'S WHO and so forth that you got your bachelor's at Harvard in 1940 and your Ph.D. in economics in 1948. Dr. Klein: Yes, that's right. Tatarewicz: I was wondering if we could go back a little bit, and if you could tell us something about your early home life and who your parents were. Klein: Okay. I was born in Minneapolis, Minnesota but up till the time I went to college, I lived in a small town in northern Minnesota by the name of Sandstone, where my father operated a general store~ Tatarewicz: Was your mother a housewife? Klein: No, she worked in the store. Tatarewicz: She worked in the store. Was it a family operation? Klein: Yes. Tatarewicz: Did you have any brothers or sisters? Klein: One sister. Tatarewicz: And was she older or younger than you? Klein: Younger. Tatarewicz: And I presume that she worked in the store also? Klein: No, not very much. Tatarewicz: I see. Were you encouraged at home to pursue education? KLEIH-2 Klein: Yes, very much. Yes. Tatarewicz: In what ways? Klein: Well, I can't remember in exactly what ways. I know it was discussed a lot. It was just something that was understood. You know, it was talked about. It was understood, and I never objected but I imagine if I had there would have been a terrific row about it. Tatarewicz: It was a foregone conclusion then that you were going to go to college? Klein: Right. Tatarewicz: Was there any thought you would take the family business over? Klein: Yes. My father wanted me to do that, but he still wanted me to go to college. Tatarewicz: How did you choose Harvard? Klein: Well, they gave me a scholarship for one thing, and I don't know, I'd just heard that it was a terrific school. Tatarewicz: Did you have any notion of what it was that you were going to study at Harvard, in college? Did you have any notion of specializing? Klein: No, I didn't. I didn't. Not really. As a matter of fact, when I first started I was going to major in music, and I did take quite a few music courses, and I don't know quite how I got into economics. Tatarewicz: Did you have to take introductory courses in economics at Harvard? Klein: Yes. Tatarewicz: As part of the undergraduate curriculum? Klein: Yes, which I did. Tatarewicz: What was your major when it came around to choosing a major as an undergraduate? Klein: Economics. Tatarewicz: It was economics. Klein: Yes. But that only meant that about a quarter of the courses that I took had to be in economics. I also took courses outside of economics. You know, history, political science. KLEIN-3 There were a certain number required, but I took many more than that. Philosophy. Tatarewicz: Were there any professors or teachers at that time whom you remember now as having been influential? Klein: Oh, yes. One in particular, Schumpeter. Joseph is his first name. I don't know if you know much about economics, but he's the economist who made innovations a fashionable subject in economics. He was the great father of understanding an economy that could bring about innovations, and as a result of bringing about innovations, could bring about evolution, because that's the main source of economic evolution. And if you notice those things, if you notice that sort of tone in a couple of things I wrote at RAND way back in the early days, a lot of that comes from Schumpeter. Tatarewicz: I see. Were you thinking, as an undergraduate, what sorts of areas of economics were you most interested in? Klein: I've always been most interested in what you call microeconomics. Microeconomics. What goes on at the level of the firm. But unlike most economists I am not interested in equilibrium economics, the economics of the dull state, in which initial conditions never change.