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Second Debate, 10/6/76: Carter Preparations
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1672849
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Second Debate, 10/6/76: Carter Preparations
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Michael Raoul-Duval Papers
Gerald Ford and Jimmy Carter Debates Files
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The original documents are located in Box 27, folder "Second Debate, 10/6/76: Carter
Preparations" of the Michael Raoul-Duval Papers at the Gerald R. Ford Presidential
Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Michael Raoul-Duval donated to the
United States of America his copyrights in all of his unpublished writings in National Archives
collections. Works prepared by U.S. Government employees as part of their official duties are in
the public domain. The copyrights to materials written by other individuals or organizations are
presumed to remain with them. If you think any of the information displayed in the PDF is subject
to a valid copyright claim, please contact the Gerald R. Ford Presidential Library.
I've signed this letter to Leon Parma. Be sure and
give the attachments to Mike Duval for the second
debate.
RBC
M GERALD R. FORD
LIBRARY
THE WHITE HOUSE
WASHINGTON
September 27, 1976
Dear Leon:
I appreciated seeing the material which
accompanied your September 24 note.
Thanks for getting it to me. I'll see
that the information is brought to the
attention of the appropriate people here.
Best regards,
Sincerely,
Vich
Richard B. Cheney
Assistant to the President
Mr. Leon W. Parma
Post Office Box 2262
La Jolla, California 92037
FORD LIBRARY is GERALD
LEON W. PARMA
POST OFFICE Box 2262
LA JOLLA, GALIFORNIA
September 24, 1976
Richard B. Cheney
Assistant to the President
The White House
Washington, D. C. 20500
Dear Dick:
Enclosed is the material that resulted from a group of
Defense people who were asked to meet with Carter's people
in Atlanta.
Mel Laird has further background on this if you need it.
I thought this information, particularly the topic per Stuart
Eizenstat would be particularly useful for the October 6th
event.
Sincerely,
Leon
Leon W. Parma
FORD is LIBRARY GERALD
enclosure
/ceb
give to Daval
Mr. Leon W. Parma
Lyon Electric Company
R
ECEIVE
P.O. Box 81303
San Diego, California 92138
SEP 23 1976
Dear Leon:
Attached for your information and use as you see fit are
copies of:
1. The issues presented to us while in Atlanta.
These are in abbreviated form which I can explain if you
need the information, and
2. A synthesis of the position papers presented
to Carter's staff by the EIA as a result of the Atlanta
meeting.
Again, if you have any questions on any of this rhaterial,
give me a call.
FORD & LIBRARY GERALD
ISSUE TOPICS PER STUART EIZENSTAT - 8/26
FORDO du GRANTO LIBRARY
1.
Cost overruns on 45 projects currently $10. 7B. Need structure,
methods, etc. to avoid more of same.
2. Current defense procurements (by dollar amount) are 20% competitive
and 80% negotiated/sole source. What can be done to improve ratio, i.e.,
more competitive awards.
3. There is a need for arms-related decisions to be compatible with foreign
policy, e.g., closer coordination between DoD and State.
4. In the area of manpower the following areas bear examination:
Relocation/moving cost savings (i.e., extending tours two months
saves 55 $400M; 6 months $5 $1B).
Grade creep problem--average military rank now 1 1/2 - 2 times
higher than was 10 years ago.
More flag rank officers in DoD now than at end of WWII.
Retirement system costly--any improvement possible?
Re: military pay, should increased flat salaries be introduced and
ancillary benefits (commisaries, housing allowances, BX, PX
privileges, etc. ) be reduced/eliminated?
Should/must salary incentives be introduced to maintain volunteer
services program?
Re Reserves and Guard--is current policy in need of overhaul to
effect change re organization, function, etc?
Education system--current military teacher pupil ratio is 1.5:1.
By increasing 3:1, possible $1B savings.
5.
What can be done to effect $ savings by standardization of weapons systems,
parts, etc. ? Goodpaster claims there is potential of $12B in savings in
NATO arena.
6. Re FMS (Foreign Military Sales), must be examined re soundness, con-
sistency, and magnitude of sales, particularly in Middle East.
7. Should DoD be organized with respect to #'s of people, overhead functions,
reporting hires, etc. ?
8. Can industry dealings with DoD be simplified with regard to red tape,
documentation, reporting requirements, etc.
9. Perennial problem of industry profitability--what's reasonable?
EIZENSTAT /NATIONAL SECURITY INDUSTRY MEETING ON 8/27/76
1. Question: Who/what constitutes national security issues staff?
Answer: Dick Holbrooke.
2. Question: What influence and/or role will Rickover play with
FORD & GERALD LIBRARY
regard to Carter's policy and/or thinking. Answer: Contact with
Rickover (to Eizenstat's knowledge) has been very limited, i.e.,
only saw two pieces of correspondence from Rickover in past year.
No known plan to rely on Rickover in any special way.
3. Comment: Rickover is principal advocate of adversary role between
Defense and industry; also critical of IR&D program ($ going to industry).
4. Comment: DoD ROI's low compared to commercial ROI's. One major
company staying in defense biz partially due to patriotic reasons. Need
to restore confidence in national security sector.
5. Comment: Minnish Bill is off base, e.g., bad bill.
6. Comment: Apprehension exists re Carter's position on maintaining a
national security base. It appears that Democratic Platform exhibits
lack of understanding of key/main issues effecting national security.
7. Comment: DoD probably one of most efficiently run departments/agencies
in Federal Government.
8. Comment: Aerospace employment down from 3. 4M in '66 to 1. 4M in '76.
Lead times for military systems run 4 to 8 and even 10 years. Delay
in "B-1 decision" may cost taxpayers $1B. Military options (of national
leadership) are dwindling.
9. Comment: Economic health of national security industry is poor. Referred
to National Industrial Conf. Rpt. (cc to Eizenstat).
10. Comment: 60% of military systems acquisition programs, managed by
Army, are for FMS. FMS allows control and influence to be exerted in
buying country because U.S. has them "by logistics tail".
11. Eizenstat: Wants to run Carter speeches (or portions thereof) by experts,
i.e., on national security matters possibly by national security industry
"experts".
12. Comment: In the Democratic platform the defense sector (DoD, industry,
etc. ) appears to be the "whipping boy". What about HEW which has
massive mismanagement (SSI, etc. --why not cut out some fat from HEW?
13. Comment: A U. S. government decision to restrict trade with
foreign countries allows penetration into (these foreign) countries
by industry in other country, which allows the latter to establish
or broaden their influence in the recipient country's economy and
way of life.
14. Question: Do you perceive a shift of the populace towards having a
strong defense--or at least not as anti as it was during the height of
SEA? Answer: There appears to be some of that. Carter doesn't
want to retreat to an isolationist position. He (Carter) does have a
genuine concern regarding foreign threats and possible "gaps" in
relative military strength.
15. Comment: The general problems re DISC's were raised.
16. Comment: Commercial business growth and return of investment there-
from seem to be going up, while the defense business and returns appear
to be declining. Many companies once exclusively or principally involved
in defense business have deliberately moved into the commercial business
sector or have significantly increased their commercial to defense
business ratios.
17. Comment: The U. S. will loose any shootouts with the Sino-Soviet bloc
when it comes to military manpower strength. Therefore, we must
rely on having better equipment and logistics, which indicates maintaining
superior technological base.
18. Comment: A $5B cut in defense funding is equivalent to approximately
300,000 defense industry jobs.
19. Comment: In-house government lab work appears to have been rising in
recent years, in spite of supposed government claims to the contrary,
while industry lab-type work has gone down.
20. Comment: LGen. Howard Fish, Director of the Defense Security
Assistance Agency, made an interesting presentation to an NSIA luncheon
group recently. Copy should be obtained.
21. Eizenstat: Mail all inputs to him at:
P. O. Box 1976
Atlanta, Ga. 30301
If need to call, Eizenstat's phone numbers are:
(R) 404-351-8494
(O) 404-897-5110
ISSUE POSITION PAPER #4
ISSUE: Is there any way in which Defense Procurement can be coordinated
with Foreign Policy objectives?
POSITION:
This, of course, is a policy question over which Industry has very
little control. However, it is apparent that normal procurement policies for
the vast majority of defense acquisitions lend themselves in an unfortunate
way to one aspect of this issue. In our open society, the decision to begin
even exploratory development of defense systems significant enough to have
foreign policy implications becomes a matter of public knowledge. The vagaries
that beset high technology development then become the subject of various
political and media excursions that invariably impact adversely on our security
stature, our national resolve, our foreign policy objectives or combinations of
all of these. This, of course, is a negative aspect of the issue and can prob-
ably only be ameliorated by extensive educationalefforts to restore a feeling
of pride in and recognition of the integrity of our defense establishment.
What may be a rather remotely related aspect of this issue is the pro-
posal that has been made in some circles that defense systems be developed
to the production stage and then "held on the shelf" until foreign policy
situations indicate an overwhelming need for the system in the operational
inventory. This premise is faulty because of the time factors involved. For
most modern defense systems ,the long production lead time and the absence of
an adequate industrial mobilization base in most industry segments precludes
"emergency" introduction of a new weapons system. It appears that future
application of the military factor to the foreign policy equation will only
be believable if the "forces in being" are adequate to the task. It is recom-
mended that for the security of the country, procurement to meet proven defense
requirements be kept out of the foreign policy and political arenas.
ISSUE POSITION PAPER #5
ISSUE:
Manpower Issues -
POSITION:
We believe that the manpower area of Defense spending is the most
fruitful area to look for any major savings that may be made in the near to
mid-term. Innovative applications of existing high technology systems to
present manpower intensive military tasks, is certainly one area that could
produce significant payoffs in the mid-term period. Another area with more
immediate return is the channeling of more maintenance and support functions
into the private sector. Several studies have shown that significant dollar
savings can be achieved if less Government work is done in-house and more is
placed with the private sector. The Defense Manpower Commission included,
in its April, 1976, Report to Congress, the use of contractors in support of
DOD. Two of their findings were:
(1) That contractor personnel should be considered as a component
in future plans regarding DOD's total force, and,
(2) That contracting out certain functions is more economical
to the Government than using military or Civil Service personnel.
Personnel policies and procedures developed and proven in the management of
high technology companies could be adapted to the more complex Defense per-
sonnel needs. in both the military and Civil Service sectors, but it is
recognized that existing laws and policies préclude any short-term break-
through in this area.
FORD LIBRARY is GERALD
ISSUE POSITION PAPER #6
ISSUE: What kind of reorganization of DOD can best serve the national
interest: Are there too many Flag and General officers and
high level civilians? What reorganization can help the In-
dustry interface?
POSITION:
There have been and continues to be many recommendations for reorgani-
zation of the DOD. It is perhaps true that DOD and its components exist in
a state of perpetual reorganization. It is certainly demonstrable that DOD
is the most often reorganized Government entity. In spite of this rather
continuous state of transition, DOD remains the branch of Government that
demonstrates the most thorough planning effort, the most effective develop-
mental organization, the most well defined procurement policies, and the best
Industry interface. This is not to imply that we feel there is not a great
need for improvement in defense policies and their application. Such Industry
issues as profitability, in-house VS. private sector contracting, restrictive
and oppressive auditing requirements, application of inflation factors to con-
tracts, and a myriad of others, have been discussed at all levels of, the the
Executive and Legislative branches of the Government. Problems continue to
exist and probably will through the forseeable future. What would help the
DOD/Industry interface the most is not another attempt at DOD reorganization,
but the development and institution of procedures whereby the management ex-
pertise that is a keystone of U.S. industrial preeminance in the world, is
afforded a more receptive environment when offered for application to Govern-
ment problems.
It is unfortunate that the American industrialist is continually placed
in an adversary role in his relations with the Government. He certainly has
something important to offer otherwise we would not be the greatest industrial
nation in history. He should be afforded a more equal partnership in assisting
ISSUE #6 - page two
with the operation of the country of which he is so vital an element.
The Industry does not feel qualified to comment in detail on the Flag
and General officer levels in DOD. It would appear though that an escalation
in grade levels, both military and civil service, has become a part of a
perhaps unplanned and unarticulated device to provide the DOD with top level
managers of a stature and a status equal to their business and foreign counter-
parts.
FORD is LIBRARY GERALD
ISSUE POSITION PAPER #7
ISSUE:
It has been said that standardization can save NATO up to $17
billion. What are the domestic problems with standardization?
What are the international problems? How can we achieve the
optimum degree of standardization? What are the issues associ-
ated with domestic vs. foreign procurement?
POSITION:
NATO standardization is a concept that is often discussed in simplistic
terms in the search for an easy solution to the complex problems of inter-
operability and logistic support. Political and economic considerations
quickly dominate the proposition that a solution to a common military problem
should be easy to achieve. NATO is an alliance of soverign states with dis-
parate resources, economic strengths, and national interests. Decisions are
only made by unanimous consent. While it might be assumed that the economics
of the Defense effort would promote cooperative ventures to share costs of
development and benefit from the economics of large scale production such is
not the general case. Some of the factors that work against true standardi-
zation are:
Fear of creating a national technological gap.
FORD & GERALA LIBRARY
Complexities of protecting patents and proprietary information
Limits on the sale of information or equipment to third parties.
Reluctance of national industries to loose business by sharing.
Balance of payment problems.
The size and state of obsolescence of existing national inventories.
The interface of military system, particulary communications
systems with national civil systems.
National pride and other philosophical considerations.
Efforts to overcome these problems have not only been addressed by
the Government representatives concerned with NATO affairs, but by a group
ISSUE #7 page two
of industrialists who form the NATO Industrial Advisory Group (NIAG). The
NIAG's objective is to provide a forum for the exchange of views on NATO
industrial problems including those associated with R&D, production, and
logistic support. Some progress is being made and better understanding of
each nation's industrial problems is a possitive result of NIAG.
The domestic problems are in general similar and a part of the inter-
national problems listed above. In addition to these problems, U.S. industry
faces an addition set of problems concerned with competative pricing in foreign
markets and the restrictions of the ASPRS. It is also apparent that as the
leading nation of the alliance in technological development and innovation, that
our industries would be especially concerned with the disemination of pro-
prietary information and production know-how. (See attached copy of Defense
Science Board report on this subject).
Optimum standardization is a very long range objective. Of more immediate
concern is the development of an interoperability capability in our weapons
systems. This is of particular importance in the area of communications where
the rapidity and volume of information exchange requires automated transfer
between adjacent or intermingled forces of the various nations. This require-
ment is presently receiving considerable attention in both Government and
Industry in this country.
ISSUE POSITION PAPER #8
ISSUE: What is the impact of arms sales abroad? Is the present level
of sales healthy? Do arms sales accomplish our foreign policy
objectives?
POSITION:
Arms sales abroad are vital elements of both our political and
economic interests. For many years the United States accepted with pride
the appellation "Arsenal of Democracy." In a world far less perfect than
American ethical standards would like to see as the norm, pragmatic interests
as well as good old fashioned patriotism require that we continue to be
the source of support to which friendly and unaligned countries can turn
to satisfy what they perceive as their security needs. Until such time
as a "mutual search for peace" by the superpowers can be shown to be more
FORD LIBRAR
truly mutual and much less unilateral, we must continue to support the
security interests of those who do not stand against us, with the products
that these countries preceive as markedly superior for the satisfaction of
their needs. In seeking friendship with the unaligned and developing nations
of the world, those who because of their weakness and vulnerability need
allies who can contribute to their peace, security and prosperity, we can
best control our degree of commitment and can best insure the honoring of our
commitments by being a supplier and a friend rather than an involved protector.
The present level of American arms "sales" abroad is subject to a wide
range of estimates depending on what phase of the acquisition process is
addressed. The past few years have seen some significant procurement decisions
made by a number of countries that indicate high value systems buys. Actual
deliveries, spread out over a number of years, give a much lower annual figure
for payments. While projections by various Government agencies have indicated
"sales" in excess of $10 billion over the past few years, actual processing
ISSUE #8 page two
and delivery figures fall well below this level. It is unfortunate that
various political and media interests use this issue as well as other defense
issues to continue to undermine the patriotism in support of a strong defense
and alliance posture for their own questionable objectives.
Arms sales do accomplish many of our foreign policy objectives. The U.S.
"presence" which accompanies such equipment sales, in the form of U.S. support
and training personnel , and U.S. documentation is an intangible, but positive,
influence on strengthened ties with the United States. Arms sales are healthy
both from the economic standpoint and from the foreign policy standpoint, pro-
viding in the latter instance a minimum degree of U.S. commitment for a maximum
degree of commitment on the part of the recipient.
Arms sales should also be recognized for their positive contribution to
domestic U.S. interests including jobs for U.S. workers (70,000 jobs for each
billion dollars of exports); balance of payments and reduced costs to U.S.
Government because of larger sales volume.
ISSUE POSITION PAPER #9
INSUR: Are Reserve Forces useful? Are they cost effective?
ASITION:
As with the broader manpower issues, the Electronic Industries As-
sociation and its member companies do not feel qualified to comment on the
details of Reserve Force structure or organization. It is generally recog-
nized, however, that if large numbers of manpower intensive forces are
required as a back-up to arestructured high technology military establishment
in the future, then such forces can best be maintained in the Reserves. How-
ever, such a Reserve should be provided with the necessary modern equipment
to permit rapid and effective mobilization and should be supported by a well
planned and utilized industrial mobilization base.
GERALD R. FORD LIBRARY
ISSUE POSITION PAPER #10
ISSUE: What are the problems Industry faces in dealing with the Government?
What can be done to cut the red tape? What can be done to improve
Government/Industry relations?
POSITION:
Some of the problems Industry faces in dealing with Government are:
Lack of mutual trust.
Little understanding of the functions of a free market.
Over bureaucratization of the Executive departments.
Over regulation.
Very little appreciation of the needs for application of
capital to keep Industry viable.
Absence of firm plans or programs.
Multiple layers of approval authority.
Unrealistic business requirements (audits, records, etc.).
Lack of competitive profit levels.
Competition with Industry in providing goods and services
(pamphlet enclosed).
TO CUT THE RED TAPE:
Place a moratorium on rhetoric designed to display American
business as the bad guys.
Accept legitimate business proposals as being honest and in
the best interest of the country. (Crack down on those who
are not honest)
Put a premium on the reduction of bureaucratic organizations
and processes.
Rely on experienced business people as advisors in areas in
which they have knowledge.
DO not rely so much on "academics" in areas where their
knowledge is only theoretical.
ISSUE #10 - page two
To improve Government/Industry relations, get the Industry side of
the equation more involved in providing solutions to relationship problems
and less in defending its actions. American Industry is still run by the
same strong dedicated patriots that built this country.
FORD & LIBRARY GERALD
1.
DECURITT INDOSTRY MELTINO ON AUGUST L1, 1970
I
Stuart Eizenstat Phone: (R) (404) 351-8494 Address: P.O. Box 1976 (NS)
(O) (404) 897-5110
Atlanta, Ga. 30301
1. Cost overruns on 45 major DoD projects currently $10. 7B. Need structure,
methods, etc. to avoid more of same.
2. Current defense procurements (by dollar amount) are 20% competitive vs. 80%
negotiated/sole source. What can be done to improve ratio, i.e., more com-
petitive awards?
3. There is a need for arms-related decisions to be compatible with foreign
policy, e.g., closer coordination between DoD and State.
In the area of manpower, the following areas bear examination:
4. Relocation/moving cost savings (i.e., extending tours two months saves
$400M; 6 months = $1B).
5. Grade creep problem--average military rank now 1.5-2 times higher than was
10 years ago.
6. More flag rank officers in DoD now than at end of WWII.
7. Retirement system is costly--any improvement possible?
FORD & LIBRARY
8. Re military pay, should increased "flat" salaries be introduced and ancillary
benefits (commisaries, housing allowances, BX, PX privileges, etc.) be
reduced/eliminated?
9. Should/must salary incentives be introduced to maintain volunteer services
program?
10. Re Reserves and Guard--is current policy in need of overhaul to effect changes
re organization, function, etc. ?
11. Education system--current military teacher pupil ratio is 1. 5:1. By increasing
3:1, possible $1B savings might accrue.
12. What can be done to effect $ savings by standardization of weapon systems,
parts, etc. ? Goodpaster claims there is potential of $12B in savings in NATO
arena.
13. Re FMS (Foreign Military Sales), must be examined re soundness, con-
sistency, and magnitude of sales, particularly in Middle East.
14. Should DoD be reorganized with respect to numbers of people, overhead
functions, reporting lines, etc?
15. Can-industry dealings with DoD be simplified with regard to red tape, documenta-
tion, reporting requirements, etc. ?
16. Perennial problem of industry profitability--what's reasonable?
QUESTIONS AND COMMENTS PUT FORTH AT STUART
EIZENSTAT/NATIONAL SECURITY INDUSTRY MEETING
II-A
&
FORD
ON AUGUST 27, 1976
1. Question: Who/what constitutes national security issues staff?
GERALD
LIBRARY
Eizenstat: Dick Holbrooke.
2. Question: What influence and/or role will Rickover play with regard to
Carter's policy and/or thinking? Eizenstat: Contact with Rickover (to
Eizenstat's knowledge) has been very limited, i.e., only saw two pieces
of correspondence from Rickover in past year. No known plan to rely on
Rickover in any special way.
3. Comment: Rickover is principal advocate of adversary role between Defense
and industry; also critical of IR&D program ($ going to industry).
4. Comment: DoD ROI's low compared to commercial ROI's. One major
company staying in defense biz partially due to patriotic reasons. Need
to restore confidence in national security sector.
5. Comment: Minnish Bill is off base, e.g., bad bill.
6. Comment: Apprehension exists re Carter's position on maintaining a national
security base. It appears that Democratic Platform exhibits lack of under-
standing of key/main issues effecting national security.
7. Comment: DoD probably one of most efficiently run departments/agencies
in Federal government.
8. Comment: Aerospace employment down from 3. 4M in '66, to 1. 4M in '76.
Lead times for military systems run 4 to 8 and even 10 years. Delay in
"B-1 decision" may cost taxpayers $1B. Military options (of national leader-
ship) are dwindling.
9. Comment: Economic health of national security industry is poor. Referred
to National Industrial Conf. Report (cc to Eizenstat).
10. Comment: 60% of military systems acquisition programs, managed by
Army, are for FMS. FMS allows control and influence to be exerted
in buying country because U. S. has them "by logistics tail".
11. Eizenstat: Wants to run Carter speeches (or portions thereof) by experts,
i.e., on national security matters possibly run by national security industry
"experts".
12. Comment: In the Democratic platform the defense sector (DoD, industry,
etc.) appears to be the "whipping boy". What about HEW which has massive
mismanagement (SSI, etc. )--why not cut out some fat from HEW?
13. Comment: A U. S. government decision to restrict trade with foreign
countries allows penetration into (these foreign) countries by industry in other
countries, which allows the latter to establish or broaden their influence in
the recipient country's economy and way of life.
II-B
14. Question: Do you perceive a shift of the populace towards having a
strong defense - or at least not as anti as it was during the height of
SEA? Eizenstat: There appears to be some of that. Carter doesn't
want to retreat to an isolationist position. He (Carter) does have a.
genuine concern regarding foreign threats and possible "gaps" in
relative military strength.
15. Comment: The general problems re DISC's were raised.
16. Comment: Commercial business growth and return of investment there-
from seem to be going up, while the defense business and returns appear
to be declining. Many companies once exclusively or principally involved
in defense business have deliberately moved into the commercial business
sector or have significantly increased their commercial to defense business
ratio.
17. Comment: The U. S. will lose any shootouts with the Sino-Soviet bloc when
it comes to military manpower strength. Therefore, we must rely on having
better equipment and logistics, which indicates maintaining superior techno-
logical base.
18. Comment: A $5B cut in defense funding is equivalent to approximately 300, 000
defense industry jobs.
19. Comment: In-house government lab work appears to have been rising in
recent years, in spite of supposed government claims to the contrary, while
industry lab-type work has gone down.
20. Comment: LGen. Howard Fish, Director of Defense Security Assistance
Agency, made an interesting presentation to an NSIA luncheon group recently.
Copy should be obtained.
21. Eizenstat: Mail all inputs to him at:
P. O. Box 1976 (NS)
Atlanta, Ga. 30301
If need to call, Eizenstat's phone numbers are:
(O) (404) 351-8494
GERALD R. LIBRERA FORD
(R) (404) 897-5110