President-elect George Bush named fellow Texan John Tower as defense secretary on Friday, ending weeks of speculation about whether the hawkish former head of the Senate Armed Service Committee would win the coveted job.

"John Tower is as knowledgable as anyone in America about defense and national security issues and he's an expert on defense policy," Bush said.Tower, 63, known for his hard-line conservative ideology, had been expected to be named before Thanksgiving but ran into trouble because of questions about his personal life and ties to the defense industry. The FBI then conducted an intensive review of the former senator.

The vice president tried Friday to demonstrate that despite Tower's close relationship with the defense industry, he would be committed to better efficiency in the Pentagon while not lessening America's defense capabilities.

Bush said he was "impressed with his (Tower's) commitment to reform," and Tower quickly outlined several methods to streamline the Pentagon.

Specifically, Tower said he wanted to implement two-year budgeting and believed the United States must "rationalize our force structure. We must refine and reform our management and procurement procedures."

"All of this is going to require very close cooperation of the Congress," Tower said. "There is a great deal that can be achieved administratively, but in the final analysis the whole job can't be done without close cooperation between the Pentagon and the Congress."

Bush, asked about Tower's background, said he was "totally satisfied in that regard" and believed Tower would have little trouble being confirmed by the Senate.

Meanwhile, sources said that Bush also has decided to name retiring Rep. Jack Kemp of New York, a former Republican rival for the White House, as secretary of Housing and Urban Development. Kemp has accepted the post, sources said, and the formal announcement may come next week.

Bush refused Friday to confirm the reports that Kemp would be named for HUD but coyly repeated one of his favorite phrases. "I will simply say, stay tuned in," he said. Kemp, 53, was contacted about last week and accepted it this week, sources said.

Other selections that could be announced, according to sources, included the transportation secretary's post, which reportedly is going to Samuel Skinner, chairman of the Chicago Regional Transportation Authority.

Sources also said it was virtually certain that Bush would name Dr. Louis Sullivan, the president of Morehouse College's School of Medicine in Atlanta, as secretary of Health and Human Services.