This study analyzes one of the most difficult problems that continues to face the U.S. Government: how to balance the costs of national security against the overall needs of the nation and how to divide up the defense costs among the military services so as to secure the most effective forces and weapons. Strategy and Money traces some of the causes of interservice controversy to the complicated factors of budget-making and shows the effects of the budget on military policy. Using the defense budget for fiscal year 1961 as an example, the author describes the budget process during 1959-60, through the presentations by the services and reviews by the Joint Chiefs of Staff and the Secretary of Defense. The concluding section points out that the disagreements within the JCS over force programs and weapon systems reveal the degree to which money decisions have influenced strategic concepts and plans. Strategy and Money forms a part of the larger History of Headquarters USAF. It is being published separately to make it more readily available throughout the Air Force.