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CHURCH COMMITTEE REPORTS
XVIII. SUMMARY: FINDINGS AND RECOMMENDATIONS
A. INTRODUCTION
The purpose of the Senate Select Committee's inquiry into the intelligence
activities of the United States has been to determine what
secret governmental activities are necessary and how they best can be
conducted under the rule of law. There is unquestioned need to build a
new conS€nsus between the executive and legislative branches concerning
the proper scope and purpose of foreign and military intelligence
activities. Allegations of abuse, revelations in the press, and the results
of the Committee's 15 month inquiry have underlined the necessity to
restore confidence in the integrity of our nation's intelligence agencies.
The findings and recommendations which follow are presented in
that spirit. They are, in essence, an agenda for mmedial action by both
the legislative and executive branches of the United States Government.
There is an urgency to completing this schedule of action. This
task is no less important to safeguarding America's future than ~re
intelligence activities themselves.
The Committee's investigation and the body of its report seek, within
the limits of prudence, to perform the crucIal task of informing the
American people concerning the nature and scope of their Government's
foreign intelligence activities. The fundamental issue faced by
the Committee in its investigation was how the requirements of American
democracy can be properly balanced in intelligence matters against
the need for secrecy. Secrecy is essential for the success of many important
intelligence activities. At the same time, secrecy contributed
to many of the abuses, excesses and inefficiencies uncovered by the Committee.
Secrecy also makes it difficult to establish a public consensus
for the future conduct of certain intelligence operations.
Because of secrecy, the Committee initially had difficulty gaining
access to executive branch information required to carry out the
investigation. It was not until the Committee became responsible for
investigating allegations of assassination plots that many of the obstacles
were cleared away. The resulting access by the Committee was
in some cases unprecedented. But the Committee's access to documents
and records was hampered nonetheless in a number of other instances
either because the materials did not exist or because the executive
branch was unwilling to make them available.
Secrecy was also a major issue in preparing this report. In order to
safeguard what are now agreed to be necessary intelligence activities,
the Committee decided not to reveal publicly the full and complete picture
of the intelligence operations of the United States Government.
The recommendations as a whole have not been materially affected by
the requirements of secrecy, but some important findings of the Committee
must remain classified in accordance with the Committee's
policy of protecting valid secrets. In this connection it should be noted
(423)
424
that some information which in the Committee~s opinion the American
public should know remains classified and has been excluded from
the report at the request of the intelligence community agencies. Only
the Senate will receIve the full version of the Committee's Final Report
in accordance with the standing rules of the Senate.
In trying to reconcile the requirements of secrecy and open democratic
processes, the Committee, found itself with a difficult dilemma.
As an investigating committee, it cannot take affirmati'"e legislative
action respecting some of the matters that came to its attention. On the
other hand, because of nect'ssary secrecy, the Committee cannot publicly
present the full case as to why its recommendations are essential.
This experience underscores the need for an effective legislative
oversight committee which has sufficient power to resolve such fundamental
conflicts between secrecy and democracy. As stated previously,
it is the Committee's view that effective congressional oversight requires
the power to authorize the budgets of the national intelligence
agencies. ,Vithout such authority, an oversight committee may find
itself in possession of important secret information but unable to act
effectively to protect the principles, integrity, and reputation of the
United States.
The findings and recommendations which follow are organized
principally by agency. There are, however, common themes in the recommendations
,vhich cut across agency lines. Some of these themes are:
guarding against abuse of America's institutions and reputation;
ensuring clear accountability for clandestine activities; establishing
effective management of intelligence activities; and creating a framework
of statutory law and congressional oversight for the agencies
and activities of the Fnited States intelligence community.
The Committee's recommendations fall into three categories: (1)
recommendations that the Committee believes should be embodied in
law; (2) recommendations to the executive branch concerning principles,
practices, and policies which the Committee believes should be
pursued within the executi,"e's sphere of responsibilities; and (3)
recommendations whieh should be taken into aceount by the executive
braneh in its relations with the intelligence m-ersight committee (s)
of Congress.
B. GEXEH.\L FIXDIXGS
The Committee finds that Fnited States foreign and military intelligenee
agencies ha'"e made important contributions to the nation's security.
and generallv haw performed their missions with dedication and
distinction. Thr Committee further finds that the individual men and
women serving America in difficult and dangerous intelligence assignments
desen-e the rrspect and gratitude of the nation.
The Committer finds that there is a continuing need .for an effective
syst<>m of forrign and military inteJ1igencr. Fnited States interests
and rrsponsibilities in thr ,yorId 'Yill be challrngrd. for the fore~
seeable futnrr. by strong and potentiallv hostile Dowers. This requires
the maintenance of an effectiVE' Amrrican intelligence system. The
Committee has fonnd that the So,-irt KGB and other hostile intelligrncr
St>n-ices maintain rxtrnsin' f0rri'!l1 intrlligence oprrations. for
both intrlligE'llcf' collectioll aml co'"crt operational purposes. These
425
activities pose a threat to the intelligence activities and interests of
the Umted States and its allies.
The Committee tinds that Congress has failed to provide the necessary
statutory guidelmes to ensure that mtelligence agencies carry
out their missions in accord with constitutional processes. l\-lechanisms
for, and the practice of, congressional oversignt have not been adequate.
Further, Congress has not devised appropriat~ means to etlectively
use the valuable informatlOn developed by the intelligence
agencies. Intelligence information and analysis that exist WIthin
the executive branch clearly would contribute to sound judgments and
more etlective legislation III the areas of foreign polley and national
security.
The Committee finds that covert action operations have not been
an exceptional instrument used only in rare lllstances when the vital
interests of the lJnited Stat.es have been at stake. On the contrary,
presidents and. administrations have made excessive, and at times
self-defeating, use of covert action. In addition, covert action has
become a routllle program with a bureaucratic momentum of its own.
The long-term impact, at home and abroad., of repeated disclosure of
U.S. covert action never appears to have been assessed. The cumulative
etlect of covert actions has been increasingly costly to America's
interests and reputation. The Committee believes that covert action
must be employed only in the most extraordinary circumstances.
Although there is a question concerning the extent to which the
ConstitutIOn requires publication of intellIgence expenditures information,
the Committee finds that the Constitution at least requires
public disclosure and public authorization of an annual aggregate
tigure for United States national intelligence activities. Congress'
failure as a whole to monitor the intelligence agencies' expendItures
has been a major element in the ineffective legIslative oversight of
the intelligence community. The permanent llltelligence oversight
committee,s) of Congress should give further consideration to the
question of the extent to which further public dis"losur~ of intelligence
budget information is prudent and ('onsllLuti01UJ ,y ;;r~Gessary.
At the same time, the Committee finds Lhat the operatlnL 01"11 extensive
and necessarily secret intelligence systsm pIttces ", . .or, stt'G-lllS
on the nation's constitutional government. The Committf't) is ,.'mlvinced,
however, that the competing demands of "['('I'ey iFid Ui6 ,'('quirements
of the democratic process-our CO.l13Llktion ,liH1 "iT
laws-can be reconciled. The need to protect secrets Uhlet be L, LCl1',\;([
with the assurance that secrecy is not used as a means to hid\~ the abu~e
of power or the failures and mistakes of policy. Means must and ca'J hI:
provided for lawful disclosure of unneeded or unlawful secrets.
The Committee finds that intelligence activities should not 130;; Ie
garded as ends in themselves. Rather, the nation's intelligence funetions
should be organized and directed to assure that they serve the
needs of those in the executive and legislative branches who have respon~
ibility. for formulating or carrying out foreign and national
secul'lty polIcy.
The Committee finds that Congress has failed to provide the necessary
st,atutory guidelines to ensure that intelligence agencies carry
out their necessary missions in accord with constitutional processes.
207-932 0 - 76 - 28
426
In order to provide firm direction for the intelligence agencies, the
Committee finds that new statutory charters for these agencies must be
written that take account of the experience of the past three and a
half decades. Further, the Committee finds that the relationship among
the various intelligence agencies and bettveen them and the Director
of Central Intelligence should be restructured in order to achieve better
accountability, coordination, and more efficient use of resources.
These tasks are urgent. They should be undertaken by the Congress
in consultation with the executive branch in the coming year. The
recent proposals and executive actions by the President are most welcome.
1 Hmvever. further action by Congress is necessary.
C. THE 1947 KATIOXAL SECURITY ACT AND RELATED LEGISLATION
The Kational Security Act of 1947 2 is no longer an adequate framework
for the conduct of America's intelligence activities. The 1947
Act, preoccupied as it ,,"as with the question of military unification,
failed to provide an adequate statement of the broad policy and purposes
to be served by America's intelligence effort. The Committee
found that the 1947 Act constitutes a vague and open-ended statement
of authority for the President through tht' National Security
Council. Keither espionage, covert action. nor paramilitary warfare
is t'xplicitly authorized by the 1947 Act. Nonetheless, these have
come to be major activities conducted by the Central Intelligence
Agency. operating at the direction of the President through the
National Security Council. In contrast. the 1947 Act's specific charge
to the Director of Central Intelligence (DCI) to coordinate national
intelligence has not been effectinly realized.
In addition to this broad concern. the Committee found that the
1947 Act does not provide an adequate charter for the Central Intelligence
A.!!ency. -MareanI', no statutory charter exists for other
key intelligence agencies: the Kational Security Agency and the
Defense Intelligence Agency. Xor does the Act create an overall
structure for intelligence which ensures effective accountability, management
control. and legislatin> and executive oversight.
Finally. the 1947 Act fails to establish clear and specific limits on
the operation of America's intelligence organizations which will help
ensure the protection of the rights and liberties of Americans under
the Constitution amI the preselTation of America's honor and reputation
abroad. The need for sllch limits is a need for legislation. The need
is not satisfied by the President's reo'nt proposals and Executive Order.
Recommendations 3
1. The National Security Act should be recast by omnibus legislation
which would set forth the basic purposes of national intelligence
activities. and define the relationship behYeen the Congress and
the intelligence agencies of the executive branch. This revision should
be given the highest priority by the intelligence oversight committee
(s) of Congress. acting in consultation with the executive branch.
1 Executive Order 11905, 2/18/76.
2,>0 C.S.C. 401 ('t seq.
3 ~pp rpcommpndations on this subject in the Committee's Report on Int~lligencp
Acti1"ities and Rights of Americans.
427
2. The new legislation should define the charter of the organizations
and entities in the United States intelligence community. It should
establish charters for the National Security Council, the Director of
Central Intelligence, the Central Intelligence Agency, the national
intelligence components of the Department of Defense, including the
National Security Agency and the Defense Intelligence Agency, and
all other elements of the intelligence community, including joint organizations
of two or more agencies.
3. This legislation should set forth the general structure and procedures
of the intelligence community, and the roles and responsibilities
of the agencies which compriseit.
4. The legislation should contain specific and clearly defined prohibitions
or limitations on various activities carried out by the respective
components of the intelligence community.
D. THE NATIONAL SECURITY COUNCIL AND THE OFFICE OF THE
PRESIDENT
The National Security Council (NSC) is an instrument of the President
and not a corporate entity with authority of its own. The Committee
found that in general the President has had, through the National
Security Council, effective means for exerting broad policy
control over at least two major clandestine activities-covert action 4
and sensitive technical collection. The covert American involvement in
Angola and the operations of the Glomar Explorer are examples of
that control in quite different circumstances, whatever conclusions one
draws about the merits of the activities. The Central Intel'ligence
Agency, in broad terms, is not "out of control." .
The Committee found, however, that there were significant limits
to this control:
]. Clandestine Activities
-The degree of control and accountability exercised regarding co,-
ert action and sensitive collection has been a function of each particular
President's willingness to use these techniques.
-The principal NSC vehicle for dealing with clandestine activities,
the 40 Committee and its predecessors, was the mechanism for reviewing
and making recommendations regarding the approval of major
covert action projects. However, this body also served generally to insulate
the President from official involvement and accountability in
the approval process until 1974.5
-As high-level government officials, 40 Committee members have
had neither the time nor inclination to adequately review and pass
judgment on all of t'he literally hundreds of covert action projects. Indeed,
only a small fraction of such projects (those which the CIA regards
as major or sensitive) are so approved and/or reviewed. This
, See definition, p. 141.
5 Appendix D. Senate Select Committee Hearings, Vol. 7, p. 230.
In 1974 the Hughes-R)'an Amendment (22 USC, 2422, section 6(2) was enacted.
It provides that no funds appropriated under the Foreign Assistance Act or any
other act IUay be expended by or on behalf of CIA foreign operations other
than for obtaining necessary intelligence "unless and until the President finds
that each such operation is important to the national security of the United
States and reports, in a timely fashion, a description and scope of such operation
to the appropriate committees of the Congress ..."
428
problem is aggravated by the fact that the 40 Committee has had virtually
no staff, with only a single officer from the Clandestine Services
acting as executive secretary.
-The process of review and approval has been, at times, only general
in nature. It sometimes has become PI'O fOl'ma, conducted over the
telephone by subordinates.
-The President, without consulting any KSC mechanism, can exercise
personal direction of clandestine activities as he did in the case of
Chile in 1970.
-There is no systematic "'hite House-level review of either sensitive
foreign espionage or counterintelligence activities. Yet these operations
may also have a potential for embarrassing the United States
and sometimes may be difficult to distinguish from covert action operations.
For example, a proposal to recruit a high foreign government
official as an intelligence "assef' would not necessarily be
reviewed outside the Central Intelligence Agency at the NSC level,
despite the implications that recruitment might pose in conducting
American foreign relations. Similarly, foreign counterintelligence operations
might be conducted without any prior review at the highest
government levels. The Committee found instances in the case of Chile
when counterintelligence operations were related to, and even hard to
distinguish from, the program of covert action.
-The President's proposals to upgrade the 40 Committee into the
Operations Advisory Group and to give explicit recognition to its role
in advising the President on covert activities are desirable. That upgrading,
however, will strain further the Group's ability to conduct a
systematic review of sensitive clandestine operations. Under the new
structure, the Group members .are cabinet officers who have even less
time than their principal deputies, who previously conducted the 40
Committee's work. The Group's procedures must be carefully structured,
so that the perspective of Cabinet officers can in fact be broug'ht
to bear.
"2. Oounterintelligence
-There is no NBC-level mechanism for coordinating, reviewing or
approving counterintelligence activities in the United States, even
those directed at United States citizens, despite the demonstrated potential
for abuse. Both the FBI and the CIA are engaged in counterintelligence,
\\"ith the CIA operating primarily abroad. The Committee
found frictions between the two agencies over the last thirtyfive
years. The so-callpd Huston Plan, discredited because of its
excessive scope and patent illegalities, was justified in part as a response
to the need for improved CIA-FBI coordination. At the same
time, the Huston Plan episode illustrates the questions of propriety
and legality which may arise in counterintelligence operations conducted
in the United States or involving American citizens.
8. Oool'dination and ItesOlll'ce A 77ocatio1/
-The Director of Central Intelligence has been assigned the function
of coordinating the activities of the intelligence community, ensuring
its responsiypness to the requirements for national intelligence,
and for assembling a consolidated national intelligence budget. Until
the recent establishment of the Committee on Foreign Intelligence
(CFI), there \vas no effective NBC-level mechanism for any of these
purposes. The Committee believes that the CFI is a step in the right
direction and is to be commended. However, the language of the Presi429
dential Order is such that much \yill depend on how the order is in fact
implemented. "~lanage" and "coordinate" are terms that are general
in nature and han> proven to be so in matters of intelligence. Because
the CFI was formed onlv recently, questions remain about its operation
and its relation to the D(~I's cun:ent responsibilities and to the existing
authority of the Secretary of Defense.
Moreover, the Committee notes that a major collector a.nd consumer
of intellio-ence information. the Department of State, IS not represented
onb the CFT. It should be. Other agencies with an important
stake in intelligence, such as the Department of the Treasury, the Energy
Resources Development Administration, an~ the ArJ!ls Control
and Disarmament Agency should play an approprIate role m the CFI
on an ad hoc basis.
.1. Executive Oversight
-The Committee finds that Presidents have not established specific
instruments of owrsight to prevent abuses by the intelligence community.
In essence. Presidents have not exercised effective oversight.
-The President's Foreign Intelligence Advisory Board (PFIAB)
has served Presidents as a useful "Kitchen Cabinet" for intelligence
and related matters. It has carried out studies that have resulted in
useful changeE in procedure and emphasis within the intelligence
community, as well as in the adoption of new technologies and techniques.
At the same time, the Committee has found that any expeotahons
that PFIAB would serve as an independent watchdog have been
mistaken. The PFIAB has been given neither statutory nor Presidential
authority to serve such a function. For instance, when the
Board became aware of the Huston Plan, it asked the Attorney General
and the Director of the FBI for a copy of the plan. That request
was refused, and the Board did not pursue the matter \vith the White
House.
-The Committee finds the President's recent establishment of the
Intelligenoe Oversight Board to be long overdue. In the Committee's
opinion. however, this does not eliminate the need for vigorous congressional
oversight. Moreover. the Order is br<Y<1dly phrased and at
some points ambiguous. The effeetiv0ness of the Oversight Board, as
well as the rest of the President's reforms, will depend in large measure
on the details of their implementation. .
The Committee makes the following recommcndations concerninO'
the National Security Council and the Office of the President. Th~
recommendations are designed to support and extend the measures
taken recently by the President.
Recommendations
5. By statuk the National Security Council should be explicitly empmyl'red
to dil'l'ct and provide policv guidance for the intel1io-ence
activiti~s of. thl' United States, inchiding intelligence colle~tion.
counterllltelhgence, and the conduct of covert action.
6. By statute, tIl(' Attorney General should be made an advisor to
the National Secnrity Council in order to facilitate discharo-ino- his
r~sponsibili~y t? ensure that .actio~ls taken to protect Amerfcm'; nahonal
secunty 1Il the field of lIltellwence are also consistent with the
Constitution and the laws of the United States.
7: By statute, t~e existing power of the Director of Central Intelligence
to coordmate the actiyities of the intelli<Tence communitv ~ .
430
should be reaffirmed. At the same time, the NSC should establish an
appropriate committee-such as the m,w Committee on Foreign Intelligence-
with responsibility for allocating intelligence resources
to ensure efficient and effective operation of the national intelligence
community. This committee should be chaired by the DCI and
should include representatives of the Secretary of State, the Secretary
of Defense, and the Assistant to the President for Nartional Security
Affairs.6
8. By statute, Ml NSC committee (like the Operations Advisory
Group) should be established to advise the President on covert action.
It would also be empowered, at the President's discretion, to approve
all types of sensitive intelligence collection activities. If an OAG member
dissented from an approval, the particular collection activity would
be referred to the President for decision. The Group should consist of
the Se~retary of State, the Secretary of Defense, the Assistant to the
President for National Security Affairs, the Director of Centra.l Intelligence,
the Attorney General, the Chairman of the .Joint Chiefs of
Statf, and the Director of OMB, as an observer. The President would
designate a chairman from among the Group's members.
9. The chairman of the Group would be confirmed by the Senate for
that position if he were an official not already subject to confirmation.
In the execution of covert action and sensitive intelligence collection
activities specifically approved by the President, the chairman would
enter the chain of command below the President.
10. The Group should be provided with adequate staff to assist in
conducting thorough reviews of cm'ert action and sensitive collection
projects. That staff should not be drawn exclusively from the Clandestine
Service of the CIA.
11. Each covert action project should be reviewed and passed on by
the Group. In addition, the Group should review all on-going projects
at least once a year.
12. By statute, tIl£' Secretary of State should be designated as the
principal administration spokesman to the Congress on the policy and
purpose underlying covert action projects.
13. By statute, the Director of Crntral Intelligence should be required
to fully inform the intelligf'nce oversight committee(s) of Congrf'SS
of f'ach covert action 7 prior to its initiation. No funds should be
expended on any C'O\'ert action unless and until the President certi.fies
and provides to the congressional intelligence oversight committee(s)
the reasons that a covert aeton is required by extraordinary circumstances
to deal with grave threats to the national security of the
United States. The congressional intelligence oversight committee(s)
should be kept fully and eurrently informrd on all coycrt action
projects, and the DCI should submit a srmi-annual report on all such
projects to the committee (s).
14. The Committre recommends that whrn the Senate establishes an
intelligence oversight cOlllmittee with authority to authorize the na-
6 In effect, this recommendation would establish the President's proposed
Committee on F'oreign Intelligence in law but would include a representative of
the Secretary of State. It would also empower the DCI to establish intelligence
requirements. See Recommendation #16, p. 434.
7 A covert a(·tion would consist of either a major project, or an aggregation of
smaller projects meeting the standards of this paragraph.
431
tional intelligence budget, the Hughes-Ryan Amendment (22 USC,
2422) should be amended so that the foregoing notifications and
presidential certifications to the Senate are provided only to that
committee.
15. By statute, a new NSC counterintelligence committee should be
established, consisting of the Attorney General as chairman, the
Deputy Secretary of Defense, the Director of Central Intelligence, the
Director of the FBI, and the Assistant to the President for National
Security Affairs. Its purpose would be to coordinate and review foreign
counterintelligence activities conducted within the "United States
and the clandestine collection of foreign intelligence within the United
States, by both the FBI and the CIA. The goal would be to ensure
strict conformity with statutory and constitutional requirements and
to enhance coordination between the CIA and FBV This committee
should review the standards and guidelines for all recruitments of
agents within the United States for counterintelligence or positive
foreign intelligence purposes, as well as for the recruitment of
U.S. citizens abroad. This committee would consider differences between
the agencies concerning the recruitment of agents, the handling
of foreign assets who come to the United States, and the establishment
of the bona fides of defectors. It should also treat any other foreign
intelligence or counterintelligence activity of the FBI and CIA
which either agency brings to that forum for presidential level
consideration.
EXECUTIVE COMMAND AND COlITROL/INTELLIGENCE ACTIVITIES
I President I I Foreign Intell4:ence J
\
Intelligence
Oversight I I I I Advisory Board
Board
I
Nationa-.!~~ity Ccu"Jcil
.Pres 'Sec State
-Vice Pres. 'Sec Def
.AG/<
I
I I I
Operatioos Advisory ~oup Q!!!ni~~Foreign ~telligence ~~Cou1terintelligence
'Sec State .OCI (chair) Ccmnittee*
'Sec Def 'DepUty Sec Def (I) ·Attorney General (chair
'Asst to President for .Deputy Asst to Pres for ·CIA Director
Nat'l Security Affair Nat'l Security Affairs ·Director/FBI
'OCI ·Desi1')lB.ted Representative! 'Asst to President for
'Ch,Jirman!JCS Sec State* Nat'l Security Affain
• ,\ttLlrtleV Cl'n.... r,l! 'llep Sec Defense
. Director/DrIB (observer) --.J,
ICFI speC~'tt
·Sec State
'Sec Def
'OCI
UJkHAAAUUAAU."
*Coomittee Recrnmend!tiau
8 See related legislative proposals in the Committee's Report on Intelligence
Activities and the rights of Americans.
432
E. TIlE DU{ECTllH OF CEC\TH.\L lC\TELLWEC\('E
The 1947 National Secnrity Act gave the DCl responsibility for
"coordinating the intelligence activities of the sen'ml GO\"ernment departments
and agencies in the interest of national security." In addition,
the DCI as the President's principal foreign intelligence adviser
was gi \"en responsibility for coordinating and producing national intelligence
for senior policymakers. Howeyer, the Committee found that
these DCl responsibilities have often conflicted with the particular
interests and prerogatives of the other intelligence community departments
and agencies. They have not given up control oyer their own
intelligence operations, and in particular the Department of Defense
and the military services, which allocate 80 percent of the direct costs
for national intelligence, have insisted that they must exercise direct
control oyer peacetime intelligence activities to prepare for war. Thus,
while the DCl \\"as given responsibility under the 1947 act for intelligence
community activities, he ,,-as not authorized to centrally coordinate
or manage the overall operations of the community.
1. Coordinator of the Intelligence Community
The Committee has found that the DCI in his coordinator role has
heen unable to ensure that \vaste and unnecessary duplication are
avoided. Be<:ause the DCI only provides guidance for intelligence
collection and production, and does not establish requirements, he is not
in a position to command the intelligence community to respond to the
intelligence needs of national policymakers. "Vhere the DCI has been
able to define priorities, he has lacked authority to allocate intelligence
resources-either among different systems of intelligence collection or
among intelligence collection, analvsis and finished intelligence
production. .
The Committee supports President Ford's objectives of enhancing
the statlll'e of the DCI and establishing a mechanism such as the Committee
on Foreign Intelligence (eFI) with the DCI as chairman to
control the allocation of national intelligence programs resources. The
Committee questions, hO\vever, whether the CFI can be effective without
some appropriate modification of the peacetime authority of the
Secretary of Defense. In order to strike an appropriate balance between
tIl(' requirements of national and tactical intelligence. the intelligence
collected by national means should be readily available to the
military commanders and vice versa. and the Secretary of Defense
and the military services should retain direct control over the operations
of tactical military intelligence. Nonetheless, the DCI needs
the right to review tactical military intelligence operations in
order to make budget choices behveen tactical and national intelligence
activities. Moreover, to carry out his coordinating role. the DCI needs
to retain control over major technical intelligence collection systems
which service both tactical and national intelligenee requirements.
B. Producer of National Intelligence
In the area of providing finished intelligence, the Committee discovered
that the DCI, in his role as intelligence adviser, has faced
obstacles in ensuring that his national intelligence judgments are objective
and independent of department and agency biases. The Committee
433
has been particularly concerned with pressures from both the White
House and the Defense Department on the DCI to alter his intelligence
judgments. One example of such pressure investigated by the Committk'c
occurred in the fall of 1969 when the DCI modified his judgment
on the capability of the Soviet SS-9 system when it conflicted
with the public position of Secretary of Defense Laird. After a meeting
with staff of the Office of the Secretary of Defense, Director Helms
deleted a paragraph from the draft of the National Intelligence Estimate
on Soviet strategic forces which stated that within the next five
years it was "highly unlikely" that the Soviets would attempt to
achieve "a first strike capability, i.e., a capability to launch a surprise
attack against the l~nited States with assurance that the U.S.S.R.
would not itself receive damage it would regard as unacceptable."
The Committee believes that over the past five years the DCI's
ability to produce objective national intelligence and resist outside
pressure has been reduced with the dissolution of the independent
Board of Xational Estimates and the subsequent delegation of its
staff to the departments with responsibility for drafting the DCI's
national intelligence judgments.
In the end, the DCI must depend on his position as the President's
principal intelligence adviser or on his personal relationship with the
President to carry out his various responsibilities and to withstand
pressllI'es to compromise his intelligence judgments. Consequently, the
Committee has been concerned that the DCI's proximity and access
to the President has diminished over the years. Since 1969, at least
until the confirmation of Mr. Bush, the DCI has rarely seen the
President E'xcept at NSC meE'tings. The influence a DCI could have
from a close relationship with the President has generally been
lacking. .
'While President Ford's EXE'cutive Order is a step in the right
direction, the Committee bE'lieves that the Del's responsibility over
intelligence community activities should be enhanced and spelled out
clearly and in detail in statute. The EXE'cutive should not continue
defining these responsibilities alone as it has done since 1947 through
EXE'cutive Orders and National Security Council Intelligence Directives
(NSCIDs).
The Committee bE'lieves that thE' Congress, in carrying out its responsibilities
in the area of national security policy, should have access
to the full range of intelligence proclucE'd by the United States intelligence
community. The CommittE'e further believes that it should be
possible to ,vork out a means of E'nsnring that the DCI's national
intelligence judgments are available to the appropriate Congressional
committees on a regular basis without compromising the DCI's role
as pE'rsonal adviser to the President.
Finally. the Committee has found concern that the function of the
DCI in his rolE'S as intelligencE' community leader and principal intelligE'nce
adviser to the President is inconsistE'nt with his responsibility
to manage one of the intelligE'nce community agencies -the CIA.
Potential problems exist in a numbE'r of arE'as. Because the DCI as
head of the CIA is responsible for human clandestine collection overseas,
intrrcpption of signaIs communication OVel'SE'aS, the development
434
and interception of technical collection systems, there is concern that
the DCI as community leader is in "a conflict of interest" situation
when ruling ?n th~ activities of the overall intelligence community.
The CommIttee IS also concerned that the OCI's new span of control-
both the entire intelligence community and the entire CIAmay
be too great for him to exercise effective detailed supervision
of clandestine activities.
Recomrnendati()"f/A
16. By statute, the DCI should be established as the President's
principal foreign intelligence adviser, with exclusive responsibility
~or producing national intelligence for the President and the Congress.
For this purpose, the DCI should be empowered to establish a
staff directly responsible to him to help prepare his national intelligence
judgments and to coordinate the views of the other members of
the intelligence community. The Committee recommends that the Director
establish a board to include senior outside advisers to review
intelligence products as necessary, thus helping to insulate the DCI
from pressures to alter or modify his national intelligence judgments.
To advise and assist the DCI in producing national intelligence, the
DCI would also be empowered to draw on other elements of the
intelligence community.
17. By statute, the DCI should be given responsibility and authority
for establishing national intelligence requirements, preparing the national
intelligence budget, and providing guidance for United
States national intelligence program operations. In this capacity he
should be desigmvted as chairman of the appropriate NSC committee,
such as the CFI, and should have the following powers and responsibilities
:
a. The DCI should establish national intelligence requirements for
the entire intelligence community. He should be empowered to draw
on intelligence community representatives and others whom he may
designate to assist him in establish\ing national intelligl'nce requirements
and determining the sueel'ss of the various agl'ncies in fulfilling
them. The DCI should providl' general guidance to the various intelligence
agency direetors for the management of intelligence operations.
b. The DCI should han responsibility for preparing the national
intelligence program budget for presentation to ithe President and the
Congress: The definition of what is to be included within that national
intelligence program should be established by Congress in consultation
with thl' Exeeutin. In this eapaeity, the Direetor of Central Intelligence
should be involnd early in the budget eycle in preparing thl'
budgets of the respecti\'c intelligenee eommunity agencies. The Director
should have specific responsibility .for ehoosing among the programs
of the different eolll'etion and prr>duetion agencies and departml'nts
and to insure against waste and unneel'ssary duplieation. The
DCI should also have responsibility for issuing fiseal guidance for the
allocation of all national intelligenee resourees. The authority of the
9 [The DCI] "hall: En"ure the dewlopment and "uhmi""ion of a hud~et for the
National Forei~n Intellig-enee Prog-ram to the CFI. (Executiw Order 1190ii.
Sec. 3 (d) iii. )
435
DCI to reprogram funds within the intelligence budget should be
defined by statute.IO
c. In order to carry out his national intelligence responsibilities
the DCI should have the authority to review all foreign and military
intelligence activities and intelligence resource allocations, including
tactical military intelligence which is the responsibility of the armed
forces. 11
d. The DCI should be authorized to establish an intelligence community
staff to support him in carrying out his managerial responsibilities.
This staff' should be drawn from the best available talent
within and outside the intelligence community.
e. In addition to these provisions concerning DCI control over national
intelligence operations in peacetime, the statute should require
establishment of a procedure to insure that in time of war the relevant
national intelligence operations come under the control of the Secretary
of Defense.
18. By statute, the position of Deputy Director of Central Intelligence
for the intelligence community should be established as recommended
in Executive Order 11905. This Deputy Director should
be subject to Senate confirmation and would assume the Del's intelligence
community functions in the DCI's absence. Current provisions
regarding the status of the DCI and his single deputy should be extended
to cover the DCI and both deputies. Civilian control of the nation's
intelligence is important; only one of the three could be a career
military officer, active or retired.
19. The Committee recommends that the intelligence oversight committee(
s) of Congress conside.r whether the Congress should appropriate
the funds for the national intelligence budget to the Del,
rather than to the directors of the various intelligence agencies and
departments.
20. By statute, the Director of Central Intelligence should serve at
the pleasure of the President but for no more than ten years.
21. The Committee also recommends consideration of separating the
DCI from direct responsibility over the CIA.12
F. THE CENTRAL INTELLIGENCE AGENCY
1. The Oharter for Intelligence Activities: Espionage, Oounterintelligence
and Oovert Action
The Committee finds that the CIA's present charter, embodied
in the National Security Act of 1947, the CIA Act of 1949, and the
1974 Hughes-Ryan amendments to the Foreign Assistance Act, is inadequate
in a number of respects.
10 "Repl'ogl'amming" means shifting money previously approved for one pm'pose
to anothel' use; for instance, from clandestine human collection to technical collection
01' covem action.
11 In contrast to President Nixon's 19i1 letter to Director Helms which asked
the DCI to plan and review".. , all intelligence activities including tactical intelligence
and the allocation of all inrt:elligence resources," President Ford's Executive
Order 111905 states that "... neither the DC! nor the CFI shall have
responsibility for tactical intelligence."
12 See discussion on pp. 449-450.
436
While the legislative history of the 1D-±7 Act makes clear that the
CIA's mandate would be limited to "foreign intelligence;' the Act itself
does not so specify. Covert action, in the past a major CIA activity,
is not mentioned in the 1D47 Act, although the Act contains a vague
and open-ended authorization for the Kational Security Council to direct
the CIA to undertake "such other functions and duties related to
the intelligence affecting the national security as the KSC may from
time to time direct." 13 K0 explicit authority even to collect intelligence
is provided the Agency.
The restrictions on domestic activities in the 1947 Act were not
clearly defined, nor was the potential conflict between these limits and
the Director's authority to protect "sources and methods" of intelligence
gathering resolved. Neither did the 1947 Act set forth the
Agency's role in conducting counterintelligence and in collecting
foreign intelligence.
The Congress' confusing and ill-defined charge to the Agency in
these areas resulted in conflicts of jurisdiction with other government
agencies. The lack of legislatin specificity also opened the way
to domestic activities such as Operation CHAOS 14 which clearly went
beyond Congress' intent in enacting and amending the National
Security Act. In sum, the Committee finds that a clear statutory basis
is needed for the Agency's conduct abroad of covert action, espionage,
counterintelligence and foreign intelligence collection and for such
counterespionage operations within the United States as the Agency
may have to undertake as a result of the activities abroad.15
Foreign Espionage
Espionage is often equated with the slightly broader category of
"clandestine human collection." Although "clandestine human collection"
may include collection of public information by a covert source,
espionage centers on recruiting and handling agents to acquire "protecteer'
or "denied" information.
Espionage on behalf of the Fnited States Government is primarily
the responsibility of the Central Intelligence Agency's Clandestine
Service which operates on a \vorld-wide basis. The Clandestine Service-
officially, the Directorate of Operations-is responsible for CIA
clandestine human collection. espionage. co\-ert aCtlon, paramilitary
operations and counterintelligence. The CIA also has special responsibilities
for coordinating the military senices' limited espionage acti
vities abroad.
By CIA doctrine, espionage should be aimed at securing information
others \,ish to conceal and not at collecting information available
through diplomatic channels or from public sources, such as the press,
television and radio.
The Clandestine Senice regards espionage. rather th!ll1 covert action
and other such acti \'ities, as the essence of its mission. Indeed,
the Committee found that clandestinc human intelligence collection
is often considered a prerequisite as \Yell as a precursor of successful
cO\-ert action. paramilitary activity, and counterintelligence.
13 AppP\1dix R. HPlll'i\1g~. "o!. 7. p. 210.
14 Spp tllP f'()llllllittpe'~ dptailpd report 011 I'rojpet f'IL\ns.
1:. Spe thp f'mlllllit'tpe's Report on nOIllP'stip Illtplligp\1('p. Part Iv. for rf'{'mulllE'lH1E'd
Iimitatio\1~ 0\1 ~uch actiYit,.
437
Espionage targets vary, covering political, military and economic
information wherever we perceive a national interest. Espionage involves
a variety of techniques, ranging from technical surveillance,
break-ins and theft, to human reportlllg by controlled agents, paid and
unpaid of protected information. It is generally illegal in the countries
against which it is aimed, but its widespread practice by nation states
makes the status of espionage under international law ambiguous.
Covert action, which is designed to have an impact, differs from
clandestine collection and classIC espionage, which are designed to obtain
intelligence without affecting the source or revealing the fact that
the information has been collected. In practice, however, covert action
and espionage overlap, since they rely on the same CIA officers, foreign
intermediaries, and sources of information.16
The Committee believes that the United States cannot forego clandestine
human collection and expect to maintain the same quality of
intelligence on matters of the highest importance to our national security.
Technical collection systems do not eliminate the usefulness of
espionage in denied areas (essentially the communist countries).
Agent intelligence can help provide valuable insight concerning the
motivations for activities or policies of potential adversaries, as well
as their future intentions.
Nevertheless, the Committee found that there are certain inherent
limitations to the value of clandestine sources. Espionage information
tends to be fragmentary, and there is always some question as to the
trustworthiness and reliability of the source.
The Committee found that over the last decade, the size of the Clandestine
Service has been reduced significantly, particularly in the field.
However, there remains the question of whether the complements
abroad and at headquarters have been reduced sufficiently.
The Committee found that the CIA's clandestine collection effort
has been reoriented towards denied areas and away from internal political
and security developments in the Third World. The Committee
belie\'es that this changed emphasis is desirable and welcomes it.
The Committee found that while internal supervision of espionage
within the CIA appears sufficient, there is inadequate external review
and control over CIA espionage activities. There is no effective machinery
to ensure that the Secretaries of States and Defense and the
Assistant to the President for National Security Affairs, who are
knowledgeable about the value and limitations of espionage, systematically
participate directly in decisions concerning such issues as how
large our pspionage effort should be. the relative priorities. risk assessments.
and p05sible duplication of effort between overt and clandestine
human collection.
The Committee notes that the duplication between the CIA's Clandestine
Service and the State Department's overt Foreign Service
reporting appears to have diminished in recent years. However, William
Colby when he was DCI voiced concern that the problem had
not been solved. The Committee notes that increased collection efforts
regarding economic issues may aggravate the overlap problem.
16 Senate Select Committee, "Covert Action in Chile." p. 6/l'.
438
Foreign Intelligeru:e Oollection in the United States
The CIA engages in both overt and clandestine activity within the
United States for the purpose of foreign intelligence collection. The
Domestic Collection Division (DCD) is responsible primarily for
overt collection, while the Foreign Resources Division (FRD) man·
ages clandestine collection of foreign intelligence. Both divisions are
currently within the Directorate of Operations. Formerly run and
staffed by the Directorate of Intelligence, the DCD was moved to
Operations in 1973 and now has many clandestine services officers
assigned to it.
The Domestic Collection Division openly collects foreign intelligence
information from American ~itizens on a wide variety of subjects,
primarily of an economic and technological nature. The Domestic
Collection Division currently maintains contact with tens of thousands
of American citizens who, on a confidential basis, volunteer informa·
tion of intelligence value to the United States. The Committee notes
that the Central Intelligence Agency is overtly in contact with many
members of the American aca.demic community to consult with them
on the subjects of their expertise. On occasion, at the request of the
academic concerned, these contacts are confidential.
The Committee believes there are significant benefits to both the
government and the universities in such contacts and that they should
not be discouraged. The Committee sees no danger to the integrity of
American academic institutions in continuing such overt contacts.
The Domestic Collection Division operates from 38 offices around the
United States and lists itself in local telephone directories, although
it conducts its business as discretely as possible.
The Foreign ResouTres Division (FRD) performs its functions in a
more traditional operational manner much as it ~ done overseas,. forf'iqn
nationals of special interest. located in the United Statf's. are en7istf'd
to cooperate secretly 'with the 01A abroad. FRD's acti1,ity.
11'1lich takes plare throughout thf' Unitf'd States, is carried out by some
of OIA's very best personnel. hi the performarlCe of its job, FRD main·
tains conta.ct with a large numbf'r of Americans who are witting of its
mission and '1villing to be cooperative. There are also a number of
America.ns 10ho are not moare that they are participating in sU<Jh 01A
activities.17
The Committee believes that the activities of the Foreign Resources
Division and the Domestic Collection Division make an important
and useful contribution to the overall intelligence effort; however,
there are significant problems.
The Committee found that the Domestic Collection Division, subsidiary
to its Ol'ert rolf', supports the clandestine components of the
CI A.It provides such services as re-settling defectors, and, by drawing
on DCD's exten,Yh'e conlarts in the U.S., reports leads regarding for·
f'iqn nationals 1oho cmild prove useful abroad or U.S. firms 10hose
offices abroad could help the CIA.
The ('ommittf'e is concerned that this kind of assistance provided
by the Domestic Collection Di1'ision, if not closely 10atched, could
7ead to an f'xp70itation of cooJ)erating Americans beyond that which
11 For explanation of italics, see footnote. p. 17ll.
439
they, themselves, envi8ioned or beyond these limited CIA objectiV'e8.18
The Conunittee notes that due to the recent revelations about CIA
activities, some foreign intelligence sources are shying away from cooperation
with the Domestic Collection Division, thus impeding this
division's most important function, namely, the overt collection of
foreign intelligence.
The Committee also questions the recruiting, for foreign espionage
purposes, if immigrants desiring American citizenship, because it
might be construed as coercive.
Forei,qn Counterintelligence 19
Counterintelligence is defined quite broadly by the CIA. It includes
the knowledge needed for the protection and preservation of the military.
economic, and productive strength of the United States, as well
as the government's security in domestic and foreign affairs, against
or from espionage, sabotage, and subversion designed to weaken or
destroy the Fnited States.
Counterintelligence (CI) is a special form of intelligence activity,
aimed at discovering hostile foreign intelligence operations and destroying
their effectiveness. It involves protecting the United States
Government against infiltration by foreign agents, as well as controlling
and manipulating adversary intelligence operations. An effort
is made to discern the plans and intentions of enemy intelligence services
and to deceive them about our own.
The Committee finds that the threat from hostile intelligence services
is real. In the United States alone, well over a thousand Soviet officials
are on permanent assignment. Among these, over 40 percent have been
identified as members of the KGB or GRU, the Soviet civilian and
military intelligence units. respectively. Estimates for the number of
unidentified Soviet intelligence officers raise this figure to over 60 percent
and some defector sources have estimated that 70 percent to 80
percent of Soviet officials in the United States have some intelligence
connection.
Furthermore, the number of Soviets with access to the United
States his tripled since 1960, and is still increasing. In 1974, for example,
over 200 Soviet ships with a total crew complement of 13,000
officers and men visited this country. Some 4,000 Soviets entered the
United States as commercial or exchange visitors in 1974. In 19721973,
for example, approximately one third of the Soviet exchange
students here for the academic year under the East-West student
exchange program were cooperating with the KGB, according to
the Central Intelligence Agency.
Other areas of counterintelligence concern include the sharp increase
in the number of Soviet immigrants to thE' rnited States (4.000
in 1974 compared to fewer than 500 in 1972) ; the rise in East-West
commercial exchange visitors (from 641 in 1972 to 1,500 in 1974) ;
and the growing number of officials in this country from other Communist
bloc nations (from 416 in 1960 to 798 in 1975).
Both the FBI and the CIA are engaged in counterintelligence work.
The CIA operates primarily abroad. ·Within the United States the
18 Ibid.
,. SE'E' also thE' SE>IE>ct CommittE>E> Report on CHAOS and the counterintelligE>nce
rerommendations in the committee's Report on Domestic IntelligencE' Acti,ities
and thE' Rights of AmE'ricans, Part IV.
440
counterintelligence mlSSlOn is conducted by the FBI, except when
the CIA, in consultation with the FBI, continues activities begun
abroad.
Defectors are an important source of counterintdligence. 1Vithin
the 17nited States, the interrogation of defectors is primarily the responsibility
of the FBI, though the CIA may also participate. Sometimes,
however, the bona fides of a defector are disputed bet,wen
the CIA and the FBI and there is no established interagency mechanism
for settling such disputes-which may last for years. An incident
in which a defector ,,,as held in so-called "incommunicado
interrogation" for two years "as, in part, a result of the lack of such
a mechanism.20
Liaison among the various U.S. Government counterintelligence
units at home is particularly important, because counterintelligencewith
all its intricacies and deceptions-requires coordination among
agencies and sharing of records. Unlike the totally unified KGB
organization, the American intelligence service is fragmented and
depends upon liaison to make operations more effective.
Coordination between CIA and FBI countBrintelligence units is
especially critical. The history of CIA-FBI liaison has beBn turbulent,
though a strong undercurrent of cooperation has usually existed
at the staff level since 1952 when the Bureau began sending a liaison
person to the CIA on a regular basis. The sources of friction between
the CIA and FBI in the early days revolved around such matters
as the frequent unwillingness of the Bureau to collect positive intelligence
for the CIA within the United States or to help recruit
foreign officials in this country.
In 1970 an essentially minor incident resulted in an ordtlr from
FBI Director Hoover to discontinue FBI liaison with the Central
Intelligence Agency. Although informal communications between
CIA and FBI staff personnel continued, it was not until the postHoover
era that formal liaison relations were reestablished. Today,
there is still a need for closer coordination of FBI and CIA counterintelligence
efforts.
The Committee believes that counterintelligence requires the direct
attention of Congress and the executive for three reasons: (l) two
distinct and partly incompatible approaches to counterintelligence
have emerged and demand reconciliation; (2) recent evidence suggests
that FBI counterespionage results have been less than satisfactory;
and (3) counterintelligence has infringed on the rights and
liberties of Americans.
Disagreement over the approach to counterintelligence affects all
aspects of this activity-eompartmentation, method of operation, security,
research priorities, deception activities. and liaison. The Committee
found that there has been no high-level executive branch review
of the classified issues surfaced in this important disagreement.
The Committee also found that there is no system of clearance
outside the CIA or FBI for sensitive counterespionage operations,
20 Recommendation 14 is based, in part, on these findings.
441
despite the difficulty of distinguishing some of these operations from
covert action.
On the FBI contribution to counterintelligence, testimony before
the Committee reveals that the Bureau has given insufficient priority
to discovering and controlling foreign agents within the United States.
Insufficient manpO\ver in the counterintelligence field, especially highly
trained analysts, appears to be part of the problem.
RecO'lnmendations
22. By statute. a charter should be established for the Central Intelligence
Agency ,vhich makes clear that its activities must be related
to. fC!reign intelligence. The Agency should be given the following
miSSions:
-The collection of denied or protected foreign intelligence
information. 23
-The eonduct of foreign counterintelligence.24
-The conduct of foreign covert action operations.
-The production of finished national intelligence.
23. The CIA, in carrying out foreign intelligence missions, would
be permitted to engage in relevant activities within the United
States so long as these activities do not violate the Constitution nor
any federal, state, or local laws within the United States.25 The Committee
has set forth in its Domestic Recommendations proposed restrictions
on such activities to supplement restrictions already contained
in the 1947 National Security Act. In addition, the Committee
recommends that by statute the intelligence oversight committee (s)
of Congress and the proposed counterintelligence committee of the
National Security Council be required to review, at least annually,
CIA foreign intelligence activities conducted within the United
States.26
24. Bv statute, the Attorney General should be required to report
to the President and to the intelligence oversight committee(s) of
Congress any intelligence activities which, in his opinion, violate the
Constitutional rights of American citizens or any other provision of
law and the actions he has taken in response. Pursuant to the Committee's
Domestic Recommendations, the Attorney General should be
made responsible for ensuring that intelligence activities do not violate
the Constitution or any other provision of law.
25. The Committee recommends the establishment of a special committee
of the Committee on Foreign Intelligence to review all foreign
human intelligence collection activities. It ,vould make recommendation
activities. (See the committee's Report on Domestic Intelligence Activities
and the Rights of Americans, Part IV.)
F.S. clandestine human collection operations and choices between
overt and clandestine human collection. This committee would be
23 This would not preclUde the NSC from assigning approprIate overt collection
funptionR to thE' CIA.
ll< The CIA would hI' excluded from any law enforcement or criminal investigationactivities.
(SE'e the Oommi't:tee's Report on Domestic Intelligence Activities
and the Rights of Americans, Part IV.)
25 Ibid.
.. For recommended review requirements for covert action operations, see
p. 26 ff.
207-932 0 - 76 - 29
442
composed of a representative of the Secretary of State as chairman,
the other statutory members of the CFI, and others whom the President
may designate.
26. The intelligence oversight committee (s) of Congress should carefully
examine intelligence collection activities of the Clandestine Service
to assure that clandestine means are used only when the information
is sufficiently important and when such means are necessary to obtain
the information.
27. The intelligence oversight committee(s) should consider
whether:
-the Domestic Collection Division (overt collection operations)
should be removed from the Directorate of Operations
(the Clandestine Service), and returned to the Directorate
of Intelligence ;
-the CIA's regulations should require that the DCD's overt
contacts be informed when they are to be used for operational
support of clandestine activities;
-the CIA's regulations should prohibit recruiting as agents
immigrants who have applied for American citizenship.
28. The President of the United States, in consultation with the
intelligence oversight committee (s) of Congress, should undertake a
classified review of current issues regarding counterintelligence. This
review should form the basis for a classified Presidential statement
on national counterintelligence policy and objectives, and should
closely examine the following issues: compartmentation, operations,
security, research, accountability, training, internal review, deception,
liaison and coordination, and manpower.
re. 01A Production of Finished Intelligence
Intelligence production refers to the process (coordination, collation,
evaluation, analysis, research, and writing) by which "raw" intelligence
is transformed into "finished" intelligence for senior policymakers.
The finished intelligence product includes a daily report and
summaries, as well as longer analytical studies and monographs on
particular topics of policy interest. In the CIA, finished intelligence
is produced by the Directorate of Intelligence and the Directorate of
Science and Technology.
Certain problems and issues in the area of CIA intelligence production
have come to the Committee's attention. The Committee believes
thees problems deserve immediate attention by both the executive
branch and future congressional intelligence oversight bodies. These
problems bear directly on the resources allocated to the production of
finished intelligence, the personnel system, and the organizational
structure of intelligence production.
The Committee recognizes that it is not the primary purpose of
intelligence to predict every world event. Rather, the principal function
of intelliQ"ence is to anticipate major foreign developments and
changes in policies which bear on United States interests. Intelligence
should also provide a deeper understanding of the behavior, processes,
and long-term trends which may underlie sudden military and political
developments.
443
The Committee wishes to emphasize that there is an important difference
between all intelligence failure and a policy failure. The
United States had intelligence on the possibility of a Turkish invasion
of Cyprus in 1974. The problem of taking effective action to prevent
such an invasion was a policy question and not an intelligence failure.
The Committee has received evidence that on some subjects, such
as the current capability of the strategic and conventional forces of
potential adversaries, U.S. intelligence is considered excellent. But
m other areas, U.S. finished intelligence is viewed by policymakers
as far from satisfactory in light of the total resources devoted to
intelligence. On balance, the Committee found that the quality, timeliness,
and utility of our finished intelligence is generally considered
adequate, but that major improvement is both desirable and possible.
One issue examined by the Committee is whether intelligence community
elements responsible for producing finished intelligence receive
adequate attention and support. Production is, in the words of one
observer, "the stepchild of the intelligence community." Since finished
intelligence is a principal purpose of all United States intelligence
activities, the Committee finds that this neglect of finished intelligence
is unacceptable for the future.
Intelligence resources are overwhelmingly devoted to intelligence
collection. The system is inundated with raw intelligence. The individual
analysts responsible for producing finished intelligence has difficulty
dealing with the sheer volume of information. Policymakers
want the latest reports, and producers of finished intelligence often
have to compete with the producers of raw intelligence for policymakers'
attention. In a crisis situation, analysts tend to focus on the
latest piece of evidence at the expense of a longer and broader view.
Intelligence Community staff saw this tendency as one reason why the
Cyprus coup in July 1974 was not foreseen.
The Intelligence Community staff in its post-mortem on the 1974
Cyprus crisis noted another general analytical problem which was
involved in the failure to anticipate the Cyprus coup and the Arab
attack on Israeli forces in October of 1973: "the perhaps subconscious
conviction (and hope) that, ultimately, reason and rationality will
prevail, that apparently irrational moves (the Arab attack, the Greek
sponsored coup) will not be made by essentially rational men."
An additional area of the Committee's concern is that analysts are
oft~n not informed in a timely way of national policies and programs
whIch affect their analyses and estimates. In its examination of cases
involving Cambodia and Chile in the 1970s, the Committee encountered
evideIl:ce that the analysts were so deprived.
Another Issue uncovered by the Committee is whether the hilYhest
quality personnel are recruited into the CIA analytical staff. A~ong
the problems raised:
-~nalysts tend to be hired early in their careers, and stay
m the Agency throughout their careers. The nature of
their work tends to insulate them from other useful
experiences.
-The an.alysts career pattern rewards most analyst by
proJI.lotmg t?em to su~e.rvisor:y positio~s thereby reducing
the tIme avaIlable to utIlIze theIr analytIcal skills.
444
-Some analysts complain that there are too many steps in
the process for reviewing finished intelligence-too much
bureaucratic "layering" in the analytical components. ·With
each successive level of review, the analysis and commentary
tend to become increasingly derivative.
-There has been little lateral entry of established analysts
and intelligence experts into CIA ranks to leaven the outlook,
interests and skills of the Agency's intelligence
analysts.27
A final issue raised by the Committee's investigation of intelligence
production is whether the new organizational structure proposed by
the President will assure the appropriate stature for the Directorate
of Intelligence to help overcome existing problems in the production of
finished intelligence. Instead of reporting directly to the DCI (who
is still to be the President's chief intelligence adviser), CIA analysts
may well report through the Deputy for the CIA. Experience indicates
that the new Deputy will need to devote the bulk of his time to
managing the Clandestine Services and the Diredorate for Science
and Technology. At the same time, the DCI may be preoccupied with
greater community-wide management responsibilities. Without some
further restructuring, the Committee believes that the production of
finished intelligence may be lost in the shuffie.
RecommendatuYfl.s
29. By statute, the Director of the Directorate of Intelligence (DDI)
should be 'authorized to continue to report directly to the Director of
Central Intelligence.
30. The Committee recommends that a system be devised to ensure
that intelligence analysts are better and more promptly informed
about United States policies and programs affecting their respective
areas of responsibility.
31. The Central Intelligence Agency and the intelligence oversight
committee(s) of Congress should reexamine the personnel system of
the Directorate of Intelligence with a view to providing a more
flexible, less hierarchical personnel system. Super-grade positions
should be available on the basis of an individual's analytical
capabilities.
32. The Directorate for Intelligence should seek to bring more
established analysts into the CIA at middle and upper grade levels for
both career positions and temporary assignments.
33. Greater emphasis should be placed on stimulating development
of new tools and methods of analysis.
34. Agency policy should continue to encourage intelligence analysts
to assume subst'antive tours of duty on an open basis in other agencies
(State, Defense, NSC staff) or in academic institutions to broaden
both their analytical outlook and their appreciation for the relevance
of their analysis to policymakers and operators within the
Government.
27 In FY 1975, only 18 out of 105 analysts hired by the DDI from outside the
CIA were at grades GS-12 to GS-15.
445
3. Covert Action and Paramilitary Operation8
Covert adion is the attempt to influence the internal affairs of other
nations in support of United StatBs foreign policy in a manner that
conceals the participation of the "Lnited States Government. Covert
action includes political and economic 'action, propaganda and paramilitary
activities.
The basic unit of covert action is the project. Covert action "projects"
can range from single 'assets, such as a journalist placing propaganda,
through a network of assets working in the medi'a, to major
covert and military intervention such as in Laos. The Agency
also maintains what it terms an "operational infrastructure" of
"stand-by" assets ('agents of influence or media assets) who can be
used in major operations-such as in Chile. These "stand-by" assets
are also part of on-going, most oftBn routine, projects. There are no
inaative assets.
001Jert Action
The Committee has found that the CIA has conducted some 900
major or sensitive covert action projects plus several thousand smaller
projects since 1961. The need to maintain secrecy shields covert I'dion
projects from the rigorous public sCTutinyand debate necessary to
determine their compatihility with established American foreign
policy goals. Recently, 'a large-scale covert paramilitary operation
in Angola was initiated without any effort on the part of the executive
branch to articulate, 'and win public support for, its overall policy
in Africa. Only public disclosure has 'allowed the nation to apply its
standards of success or failure to covert action projects and then only
in retrospect, often without the benefit of the details prompting the
original choice of covert rather than overt action.
The secrecy covert action requires means that the public cannot
detel'IDine whether such actions are consistent with estwblished foreign
policy goals. This secrecy also has allowed covert actions to take place
which are inconsistent with our basic traditions and values.
Some covert operations have passed restrospective public judgments,
such as the support given Western European democratic parties facing
strong communist opposition in the late 1940s and 19508. Others have
not. In the view of the Committee, the covert harassment of the
democratically elected government of Salvador Allende in Chile did
not command U.S. public approval.
Even if the short-term consequences of covert action are consistent
,,,ith stated policy and accepted standards, the Committee has found
that the continued use of covert action techniques within or against
a foreign society can have unintended consequences that sometimes subvert
long-term goals. For instance, extended covert support to foreign
political leaders, parties, la:bor unions, or the media has not always
accomplished 'the intended objective of strengthening them against
t~~ co,?munist challenge. In some cases, it has both encouraged a deblhtatmg
dependence on United States covert support, and made
those receiving such support vulnerable to repudiation in their own
society when their covert ties are exposed. Furthermore, prolonged
covert relations and the resulting dependence of recipients on con446
tinued CIA support seem to encourage the CIA to extend its ties
to means of controlling the recipients in other respects. Covert actions
also have, over time, developed a bureaucratic momentum of
their own that often surpasses the original need for covert action.
Paramilitary 0 perati<Yns
Covert paramilitary operations are a special, extreme form of covert
action. These operations most often consist of covert military assistance
and training, but occasionally have involved ftCtual oombat activities
by American advisers.
Because military assistance involves foreign policy commitmeJ.lts, ~t
is, 'with one exception, authorized by the Congress. Thalt exception IS
covert military assistance which is channeled through the CIA without
being authorized or approved by the Congress as a iWhole.
Covert U.S. paramilitary combat operations frequently amount to
making war, but they do not come under the 'Var Powers Act s~nce
they usually do not involve uniformed U.S. military officers. AmerlCan
military offi~ers engaged in CIA-sponsored paramilitary operations
are "sheep-dipped" for paramilitary duty-that is, they appear to
resign from the military yet preserve their place for reactivation once
their tour as civilian in paramilitary operations has ended.
The Committee finds that major paramilitary operations have often
f'ailed to achieve their intended objective. Most have eventually been
exposed. Operations, as in Angola, recently, and Indonesia in the late
1950s are examples of such pUiramilitary failures. Others, such as Laos,
are judged successes by the CIA and officials within the executive
branch. The "success" in Laos, however, must be seen against the larger
American involvement in Indochina which failed.
Paramilitary operations often have evolved into large-scale programs
with a high risk of exnosure (and thus embarrassment and/or
failure). In some cases, the CIA has been used to undertake paramilitary
operations simply because the Agency is less accountable to the
public for highly visible "secret" military operations. In all cases
considered by the Committee, command and control within the executive
branch was rigorous. However, all such operations have been
conducted without direct congressional authority or public debate.
In Tecent yeUirs, some have been continued in the face of strong congressional
disapproval.
Recently, however-apart from Angola-United States paramilitary
activities have been at a very low level. The capa:bility for these
a.ct.ions, residing jointly in the CIA and the Department of Defense,
consists of a cUidre of trained officers. stockpiles of military equipment,
logistic networks and small collections of lLir and maritime
assets.
Review and Approval of Oovert Action
Given the open and democratic assumptions on whioh our government
is based, the Committee has given serious consideration to the
option of proposing n total ban on all forms of covert activity. The
Committee has concluded, however, that the United States should
maintain the capability to react through covert action when no other
means will suffice to meet extraordinary circumstances involving grave
447
threats to U.S. national security. Nevertheless, covert action should be
considered as an exception to the normal process of government action
llibroad, rather than a parallel but invisible system in which covert
operations are routine.
Absent some means of assuring public participation in assessing
each covert action, the mechanisms of executive branch review and
control and of legislative intelligence oversight must serve as the
restricted arenas in which such standards are applied to covert action.
The Committee's examination of the covert action record over the last
25 years has underscored the necessity for legislative reinforcement
of the executive branch's internal review process. This is necessary to
assure that all covert action projects are reviewed, and to establish a
system of formal accountability within the executive accessible to
congressional intelligence oversight bodies.
The CIA has not been free, hmvever, to carry out covert action as
it sees fit. The Committee's investigation revealed that on the whole,
the Agency has been responsive to internal and external review and
authorization requirements. Most of the significant covert operations
have been approved by the appropriate NSC committee. At the same
time, the Committee notes that approval outside the Agency does not
solve all problems since the NSC committees have approved (and in
some cases initiated) projects that involved highly improper practices
or were inconsistent with declared foreign policies.
Approximately three-fourths of all covert action projects are never
reviewed or approved by a high level body outside the CIA.28 These
projects which are not brought before the NSC for review are socalled
"non-sensitive" projects, or part of what the CIA calls its
"operational infrastructure." The Committee found that a single small
project, though not reviewed by the NSC, still can be of great importance
(e.g. QJWIN, the CIA "executive action" assassination capability,
and AMLASH, the Cuban officer being groomed to kill Fidel
Castro). Moreover, a cluster of small projects can be aggregated to
form a program of significance (e.g., Chile).
Until recently, Congress, through its committees, has failed to effectively
oversee CIA covert action. Much of this flowed from the
legitimate desire of the congressional oversight committees to maintain
the security of covert action projects, but it also resulted from
It hesitancy to challenge the President or to become directly involved
in projects he deemed necessary. Covert paramilitary operations
pose a special problem, since they cut across several functions (and
committee jurisdictions) of Congress-namely, granting military
assistance and making war.
Members of the congressional oversight committees are almost
totally dependent on the executive branch for information on covert
operations. The secrecy needed for these covert operations allows the
executive to limit the information provided to the Congress and to use
covert actions to avoid the open scrutiny and debate of the normal
foreign policy procedures. While the Committee believes that the
28 Since 1974, the President has had to certify all covert actions as important
to the national.security-treating smaller projects by certain broad categories.
448
executive should continue to have the initiative in formulating covert
action, it also strongly believes that the appropri,ate oversight bodies
of Congress should be fully informed prior to the initiation of such
actions.
Congressional power over the purse can serve as the most effective
congressional oversight tool if there is the courage and the will to exercise
it. In addition to the regular budget for covert action, the Agency
draws on a Contingency Reserve Fund for unanticipated projects. Any
withdmwals from this fund require approval from the Office of
Management and Budget and notification, within 48 hours, to the
appropriate congressional committees. The Committee believes that
the Contingency Fund can also provide one of the mechanisms by
which Congress can effectively control covert action.
Recommendations
35. The legislation establishing the charter for the Central Intelligence
Agency should specify that the CIA is the only U.S. Government
agency authorized to conduct covert actions. The purpose of
covert actions should be to deal with grave threats to American
security. Covert actions should be consistent with publicly-defined
United States foreign policy goals, and should be reserved for extraordinary
circumstances when no other means will suffice. The legislation
governing covert action should require executive branch procedures
which will ensure careful and thorough consideration of both the
general policies governing covert action and particular covert action
projects; such procedures should require the participation and accountability
of highest level policymakers.
36. The Committee has already recommended, following its investigation
of alleged assassination attempts directed at foreign leaders,
a statute to forbid such activities. The Committee reaffirms its
support for such a statute and further recommends prohibiting the
following covert activities by statute:
- All political assassinations.29
- Efforts to subvert democratic governments.
- Support for police or other internal security forces which
engage in the systematic violation of human rights.
37. By statute, the 'appropriate NSC committee (e.g., the Operations
Advisory Group) should review every covert action proposa1.30
The Committee recommends that the Operations Advisory Group
review include:
-A careful and systematic analysis of the political premises
underlying the recommended actions, as well as the nature,
extent, purpose, risks, likelihood of success, and costs of
the operation. Reasons explaining why the objective can-
29 The Committee endorses Executive Order 11905. of February 18, 1976,
which states: "No employee of the United States Goverment shall engage in, or
conspire to engage in, political assassination."
30 Exeeutive Order 11905, 2/18/76, established the Operations Advisory
Group and directed it to "consider and develop a policy recommendation, including
any di~sents, for the President prior to his decision on eaeh special 'activity
[e.g., covert operations] in support of national foreign policy objectives."
449
not be achieved by overt means should also be considered.
-Each covert action project should be formally considered
at a meeting of the OAG, and if approved, forwarded to the
President for final decision. The vie;ys and positions of the
participants ,yould be fully recorded. For the purpose of
OAG. presidential, and congressional considerations, all
so-called non-sensitive projects should be aggregated according
to the extraordinary circumstances or contingency
against which the project is directed.
38. By sbtute, the intelligence oversight committee (s) of Congress
should require that the annual budget submission for covert action
programs be specified and detailed as to the activity recommended.
Unforeseen covert action projects should be funded from the
Contingency Reserve Fund which could be replenished only after the
concurrence of the oversight and any other appropriate congressional
committees. The congressional intelligence oversight committees
should be notified prior to any withdrawa,l from the Contingency
Reserve Fund.
39. By statute, any covel1t use by the U.S. Government of American
ci,tizens as combatants should be preceded by the notification required
for 'all coveIt actions. The statute should provide that within 60 days
of such notification such use shall be terminated unless the Congress
has specifically authorized such use. The Congress should be empowered
to terminate such use at any time,3l
40. By statute, the executive branch should be prevented from conducting
any covert military assistance program (including the indirect
or direct provision of military material, military or logistics
advice and training,and funds for mercenaries) without the explicit
prior consent of the intelligence oversight committee (s) of Congress.
G. REORGANIZATION OF THE INTELLIGENCE COMMUNITY
1. The Position of the DOl
The Committee recommend'ations regarding the Director of Central
Intelligence (pages 43-45) would, if implemented, increase his authority
over the entire intelligence community. Given such increased authority,
the Committee believes that both the executive branch and the
intelligence oversight committee (s) of Congress should give careful
consideration to removing the DCI from direct management responsibility
for the Central Intelligence Agency. This would free the DCI
to concentrate on his responsibilities wi,th regard to the entire intelli~
ence community and would remove him from any conflict of interest
III performing that rbask. It might alsoincrea.'ie the accountability of
the Central Intelligence Agency by establishing a new and separate
senior position-a Director of the Central Intelligence Agencyresponsible
for only the CIA.
2. The Structures of the CIA
. The Committee believes that several important problems uncovered
III the course of this inquiry suggest that serious consideration also
be given to major structural change in the CIA-in particular, sepa-
31 This recommendation parallels the current provisions of the War Powers
ReSOlution which could be so amended. (Appendix C, Hearings, Vol. 7, p. 226.)
450
rating national intelligence production and analysis, from the clan~estine
service and other collection functions. Intelhgence productIOn
could be placed directly under the DCI, while .clandestine collection of
foreign intelligence from human and techmcal sources and covert
operations would remain in the CIA.
The advantages of such a step are several:
-The DCI would be removed from the conflict of interest
situation of managing the intelligence community as a
whole while also directing a collection agency.
-The concern that the DCI's national intelligence judgments
are compromised by the impulse to justify certain
covert action operations or by the close association of the
analysts with the clandestine service would be remedied.
-The problem, seen by some in the intelligence community,
of bias on the part of CIA analysts toward the collection
resources of the CIA would be lessened.
-It would facilitate providing the intelligence production
unit with greater priority and increased resources necessary
for improving the quality of its finished intelligence.
-Tighter policy control of the Clandestine Service by the
National Security Council and the Department of State
would be possible.
-The Director would be able to focus increased attention
on monitoring Clandestine Services.
-Internal reorganization of the Directorate for Intelligence
and the remainder of the CIA could be facilitated.
There are potential drawbacks as well :
-The Director of Central Intelligence might lose the influence
that is part of having command responsibility for the
clandestine services.
-The increasing, though still not extensive. contact between
national intelligence analysts and the Clandestine Service
for the purpose of improving the espionage effort might be
inhibited..
-The DCI would have managerial responsibility over the
former CIA analysts which might place him in a conflictof-
interest situation in regard to the production of intelligence.
-The increased number of independent agencies would increase
the DCI's coordination problems.
-If the clandestine services did not report to the DCI, there
would be the problem of establishing an alternative chain
of command to the President.
-The Clandestine Service might be downgraded and fail to
secure adequate support.
Nonetheless, on balance, the Committee believes such a separation
of functions and consequent possible realignments in authority within
the intelligence community medit serious consideration.
451
Recomonendati01l.8
41. The intelligence oversight committee (s) of Congress in the
course of developing a new charter for the intelligence community
should give consideration to separating the functions of the DCI and
the Director of the CIA and to dividing the intelligence analysis and
production functions from the clandestine collection and covert action
functions of the present CIA.
H. RELATIONS WITH Ul'aTED STATES INSTITUTIONS AND PRIVATE
CITIZENS
In the immediate postwar period, as the communists pressed to
influence and to control international organizations and movements,
mass communications, and cultural institutions, the United States
responded by involving American private institutions and individuals
in the secret struggle over minds, institutions, and ideals. In the
process, the CIA subsidized, and even helped develop "private" or
non-government organizations that were designed to compete with
communists around the world. The CIA supported not only foreign
organizations, but also the international activities of United States
student, labor, cultural, and philanthropic organizations.
These covert relationships have attracted public concern and this
Committee's attention because of the importance that Americans
attach to the independence of these institutions.
The Committee found that in the past the scale and diversity of
these covert actions has been extensive. For operational purposes, the
CIA has:
-Funded a special program of a major American business
association;
-Collaborated with an American trade union federation;
-Helped to establish a research center at a major United
States university;
-Supported an international exchange program sponsored
by a group of United States universities;
-Made widespread use of philanthropic organizations to
fund such covert action programs.
The Committee's concern about these relationships is heightened by
the Agency's tendency to move from support to use of both
institutions and individuals. For example, the initial purpose of the
Agency's funding of the National Student Association was to permit
United States students to represent their own ideas, in their own way,
in the international forums of the day. Nevertheless, the Committee
has found instances in which the CIA moved from general support to
the "operational use" of individual students.32 Contrary to the public's
understanding, over 250 United States students were sponsored by the
CIA to attend youth festivals in Moscow, Vienna and Helsinki and
3:l Operational use, according to CIA directives, means performing services in
support of the CIA Operations Directorate, and may include the recruitment,
utilization, or training of any individual for such purposes as providing cover and
collecting intelligence.
452
used for missions such as reporting on Soviet and Third ",Vorld personalities
or observing Soviet security practices. The CIA also used
National Student Association Summer International Seminars in the
United States in the 1950s and 1960s to identify and screen new leaders
whom they would eventually support at the national NSA Convention.
When the CIA's relationship to NSA was publicly revealed in 1967,
the Johnson Administration established the Katzenbach Committee,
with a limited mandate to investigate the relationship of the CIA to
"U.S. educational and private voluntary organizations which operate
abroad." The Katzenbach Committee recommended that it should be
the policy of the United States Government not to provide any "covert
financial assistance or support, direct or indirect, to any of the nation's
educational or private voluntary organizations."
The Committee found that the CIA not only carried out this Katzenbach
recommendation but also terminated support for a number of
other U.S.-based organizations such as publishing houses. Nevertheless,
the CIA, 'with the approval of the appropriate NSC committee,
insured the continuation of a number of high priority operations by
either moving them overseas or encouraging private and non-CIA
government support of domestically-based operations. More importantly,
however, the CIA shifted its operational interest from institutional
relationships to individuals in, or affiliated with, private
institutions.
The Committee inquiry has been particularly concerned about the
current operational use of United States citizens as individuals. Some
academics now help the CIA by providing leads and, on occWJion, making
in tl'oductions to potential sources of foreign intelligence. American
academics and freelance writers are occasionally used abroad to assist
the CIA's clandestine mission.
1. Oovert Use of the U.S. Academic Community
The Central Intelligence Agency is 1WW using several hundred
American academics,33 who in addition to providing leads and sometimes
making introductions for intelligence purposes, occasiorwlly
'write books and other material to be used for p'f'opaganda purposes
abroad. Beyond these, an additional few more are used in an unwitting
manner for mi1Wr activities.
These academics are located in over 1(}() American colleges, universities,
and related institutes. At the majority of institutions, 1W one other
than the individual academic concerned is aware of b.he CIA link. At
the others, at least one university official is alvare of the operational
use m<Uie of academics on his campus. In addition, there are several
American academics abroad lvho serve operational purposes, primarily
the collection of intelligence.
The CIA gives a high priority to obtaining leads on potential foreign
intelligence sources especially those from commJUnist countries. This
Agency's emphasis reflects the fact that many foreign rwtional8 in the
United States are in this category. The Committee notes that American
academics provide valuable assistance in this activity.33a
33 "Academics" includes administrators, faculty members, and graduate students
engaged in teaching.
33. For explanation of italics, see footnote, p. 79.
453
The Oommittee i8 concerned, hOlOever, that American academics
involved in such (J£·ti·cities may undermine public confidence that those
lOho train our youth are upholding the ideals, independence, and integrity
of American universities.
Government Grantees
OIA regulation8 adopted in 1967 pro,hibit the "operati01l.al" use of
certain narrolO categories of 7:ndividuals. The OIA is prohibited from
U8ing teachers, lecturers, and students receiving grants from the Board
of Foreign FellolOships under the Fulbright-Hayes Act.34 There is no
prohibition on the U8e of individuals participating in any other
federally funded exchange programs. For example, the OIA may U8e
those grantees-artists, specialists, athletes, leaders, etc.--who do not
receive Meir gra.nts from the Board of Foreign Scholarships. The
Oommittee is concerned that there is no prohibition again8t exploiting
such open federal programs for clandestine purposes.S5
92. The Oovert Use of Books and Publishing Houses
The Committee has found that the Central Intelligence Agency
attaches a particular importance to book publishing activities as a
form of covert propaganda. A former officer in the Clandestine Service
stated that books are "the most important weapon of strategic (longrange)
propaganda." Prior to 1967, the Central Intelligence Agency
sponsored, subsidized, or produced over 1,000 books; approximately 25
percent of them in English. In 1967 alone, the CIA published or subsidized
over 200 books, ranging from books on African safaris and wildlife
to translations of Machiavelli's The Prince into Swahili and works
of T. S. Eliot into Russian, to a competitor to Mao's little red book,
which was entitled Quotation8 fromOhairman Liu.
The Committee found that an important number of the books actually
produced by' the Central Intelligence Agency were reviewed and
marketed in the United States:
-A book about a young student from a developing country
who had studied in a communist country was described by
the CIA as "developed by [two areas divisions] and produced
by the Domestic Operations Division... and has
had a high impact in the United States as well as in the
[foreign area] market." This book, which was produced
by the European outlet of a United States publishing house
was published in condensed form in two major U.S.
magazines.36
-Another CIA book, The Penko'l'sky Papers, was published
in United States in 1965. The book was prepared
and written by witting agency assets who drew on
actual case materials and publication rights to the manu-
.. CIA regulations also prohibit the operational use of members of ACTION
and officials, employees, and grantees of the Ford, Rockefeller, and Carnegie
Foundations.
35 For explanation of italics, see footnote, p. 79.
,., CBS commentator Eric Sevareid, in reviewing this book, spoke a larger
truth than he knew when he suggested that "our propaganda services could
do worse than flood [foreign] university towns with this volume."
454
script were sold to the publisher through a trust fund which
was established for the purpose. The publisher was unaware
of any U.S. Government interest.
In 1967, the CIA stopped publishing within the United States.
Since then, the Agency has published some 250 books abroad, most of
them in foreign languages. The CIA has given special attention to
publication and circulation abroad of books about conditions in the
Soviet Bloc. Of those targeted at audiences outside the Soviet Union
and Eastern Europe, a large number has also been available in
English.
3. Domestic "Fallout"
The Committee finds that covert media operations can result in
manipulating or incidentally misleading the American public. Despite
efforts to minimize it, CIA employees, past and present, have conceded
that there is no way to shield the American public completely from
"fallout" in the United States from Agency propaganda or placements
overseas. Indeed, following the Katzenbach inquiry, the Deputy
Director for Operations issued a directive stating: "Fallout in the
United States from a foreign publication which we support is inevitable
and consequently permissible."
The domestic fallout of covert propaganda comes from many sources :
books intended primarily for an English-speaking foreign audience;
CIA press placements that are picked up by an international wire
service; and publications resulting from direct CIA funding of foreign
institutes. For example, a book written for an English-speaking
foreign audience by one CIA operative was reviewed favorably by
another CIA agent in the New York Times. The Oommittee also found
that the 01A he~ped create and suppm't 'carious Vietnamese periodicals
r.tnd publicati01Ul. In at least one instance, a 01A supported Vietnamese
publication was used to propagandize the American public and the
members and staff of both houses of Oongress. So effective was this
propaganda that some members quoted from the publication in debating
the controversial question of United States involvement in
Vietnam.
The Oommittee found that this inevitable domestic fallout was compounded
when the Agency circulated its subsidized books in the United
States prior to their distribution abroad in order to induce a favorable
reception overseas.
The Oovert Use of u.s. Journalists and Media Institutions on February
11,1976, OIA Director George Bush announced new guidelines
governing the Agency's realtionship with United States media organizations:
Effective immediately, OIA will not enter into any paid or
contractual relationship with any full-time or part-time news
correspondent accredited by any U.S. news service, newspaper,
lperiodical, radio or television network or station.3S
38 According to the CIA. "accredited" applies to individuals who are "formally
authorized by contract or issuance of press credentials to represent themselves
as correspondents." (For explanation of italics. see footnote, p. 179.)
455
Agency officials who testified after the February 11, 1976, announcement
told the Committee that the prohibition extends to non-Americans
accredited to specific "Cnited States media organizations.
The OIA currently 1r!4intains a net'work of seveml huruir·ed foreign
individuals around the world who provide intelligence for the OIA
and at times attempt to infltuence opinion through the use of covert
propaganda. These individuals prouide the OIA with direct a<:cess to
a large number of newspapers and periodicals, scores of press services
and news agencies, radio and television stations, commercial book
publishers, and other foreign media outlets.
Approximately 50 of the assets are individual American journalists
or employees of u.s. 1Twdia or·ganizati011-~. Of these, fewer than half
are "accredited" by U.S. media organizations and thereby affected by
the new prohibitions on the use of accredited newsmen. The remaining
individuals are non-accredited freelance contributors and media representatives
abroad, and thus are not affected by the new 01A
prohibition.
More than a dozen United States news organizations and commercial
publishing houses formerly provided cover for OIA agents abroad.
A few of these organizations were unaware th.at they provided this
cover.
The Oowmittee notes that the new OIA prohibitions do not apply
to "unaccredited" Americans serving in media organizations such as
representatives of u.s. media organizations abroad or freelance
writers. Of the more than 50 OIA relationships ~vith United States
journalists, or employees in American media organizations, fewer
than one half will be terminated under the new OIA guidelines.
The Oowmittee is concerned that the use of American .journalists
and media organizations for clandestine operations is a threat to the
integrity of the press. All American journalists, whether accredited
to a United States news organization or just a stringer, 1r!4Y be suspects
when any are engaged in covert a<:tivities.39
4. Oovert Use of American Religious Personnel
The Committee has found that over the years the CIA has used very
few religious personnel for operational purposes. The CIA infonned
the Committee that only 21 such individuals have ever participated in
either covert action projects or the clandestine collection of intelligence.
On February 11, 1976, the CIA announced:
CIA has no secret paid or contractual relationships with any
American clergyman or missionary. This practice will be continued
as a matter of policy.
The Committee welcomes this policy with the understanding that
the prohibition against all "paid or contractual relationships" is in
fact a prohibition against any operational use of all Americans following
a religious vocation.
Recommendations
In its consideration of the recommendations that follow, the Committee
noted the Central Intelligence Agency's concern that further
restriction on the use of Americans for operational purposes will con-
""For e;xplanation of italics, see footnote, p. 179.
456
strain current operating programs. The Committee recognizes that
there may be at least some short-term operational losses if the Committee
recommendations are effected. At the same time, the C.)mmittee
believes that there are certain American institutions whose integrity
is critical to the maintenance of a free society and which should therefore
be free of any unwitting role in the clandestine service of the
United States Government.
42. The Committee is concerned about the integrity of American
academic institutions and the use of individuals affiliated with such
institutions for clandestine purposes. Accordingly, the Committee
recommends that the CIA amend its internal directives to require
that individual academics used for operational purposes by the CIA,
together with the President or equivalent official of the relevant
academic institutions, be informed of the clandestine CIA
relationship.n
43. The Committee further recommends that, as soon as possible, the
permanent intelligence oversight committee (s) of Congress examine
whether further steps are needed to insure the integrity of American
academic institutions.
44. By statute, the CIA should be prohibited. from the operational
use of grantees who are receiving funds through educational and/or
cultural programs which are sponsored by the United States
Government.
45. By statute, the CIA should be prohibited from subsidizing the
writing, or production for distribution within the United States or
its territories, of any book, magazine, article, publication, film, or
video or audio tape unless publicly attributed to the CIA. Nor should
the CIA be permitted to undertake any activity to accomplish indirectly
such distribution within the United States or its territories.
46. The Committee supports the recently adopted CIA prohibitions
against any paid or contractual relationship between the
Agency and U.S. and foreign journalists accredited to U.S. media organizations.
The CIA prohibitions should, however, be established in
law.
47. The Committee recommends that the CIA prohibitions be extended
by law to include the operational use of any person who regularly
contributes material to, or is regularly involved directly or indirectly
in the editing of material, or regularly acts to set policy or
provide direction to the activities of U.S. media organizations.
48. The Committee recommends that the Agency's recent prohibition
on covert paid or contractual relationship between the Agency
and any American clergyman or missionary should be established by
law.
I. PROPRIETARIES AXD COVER
1. Proprietary Organizations
CIA proprietaries are business entities wholly-owned by the
Agency ,,-hich do business, or only appear to do business, under commercial
guise. They are part of the "arsenal of tools" of the CIA's
41 This recommendation is consistent with and would extend section 4(b) (9)
of E.O.. 11905 which states tlmt CIA sponsorship of classified or unclassified
research must be "known to appropriate senior officials of the academic institutions
and to senior project officials."
457
Clandestine Services. They have been used for espionage as well as
covert action. Most of the larger proprietaries have been used for paramilitary
purposes. The Committee finds that too often large proprietaries
have created unwarranted risks of unfair competition with
private business and of compromising their cover as clandestine operations.
For example, Air America, which at one time had as many as
8,000 employees, ran into both difficulties.
While internal CIA financial controls have been regular and systematic,
the Committee found a need for even greater accountability
both internally and externally. Generally, those auditing the CIA
have been denied access to operational information, making management-
oriented audits impossible. Instead, audits have been concerned
only with financial security and integrity.
The Committee found that the CIA's Inspector General has, on
occasion, been denied access to certain information regarding proprietaries.
This has sometimes inhibited the ability of the Inspector
General's office to serve the function for which it was estabished. Moreover,
the General Accounting Office has not audited these operations.
The lack of review, by either the GAO or the CIA Inspector General's
office, means that, in essence, there has been no outside review of
proprietaries.
One of the largest current proprietaries is an insurance-investment
complex established in 1962 to provide pension annuities, insurance
and escrow management for those who, for security reasons, could not
receive them directly from the U.S. Government. The Committee determined
that the Congress was not infoffiled of the existence of this
proprietary until "sometime" after it had been made operational and
had invested heavily in the domestic stock markets-a practice the
CIA has discontinued. Moreover, once this proprietary was removed
from the Domestic Operations Division and placed under the General
Counsel's office it recelVed no annual CIA project review.
The record establishes that on occasion the insurance-investment
complex had been used to provide operational support to various covert
action projects. The Inspector General, in 1970, criticized this use of
the complex because it threatened to compromise the security of the
complex's primary insurance objectives.
In general, the Committee found that when the CIA sought to dispose
of or dissolve a proprietary, considerable effort was made to
avoid conflicts of interest. However, pressures were sometimes unsuccessfully
brought to bear on the CIA from without, and on one or
more occasions from high level Agency officials to do a favor by disposmg
of an entity in a manner that would benefit a particular party.
In this connection, the Committee notes that the CIA is not subject
to the provisions of the Federal Disposal of Property Act which 01'dinnrily
guards against such pressures.
Management and control of proprietaries frequently required, and
still do, 'what is termed "cooperative interface" with other goverment
agencies, such as the SEC and the IRS. The Committee found no evidence
that these relationships involved circumventing statutory or
regulaJtory requirements. Their purpose appears to be to emtble the
Agency to comply with other agencies' requirements in a secure
manner. HO\vever. the nature and extent of such "interfacing" has not
always been completely recorded in the CIA, making it difficult to
ensure the propriety of such relationships.
207-932 0 - 76 - 30
458
rd. Oover
The Oommittee examined cover became it is an important aspect of
all 01A clandestine activities. Its importance is underscored by the
tragic mJUrder of a OIA Station Ohief in Greece, coupled with continuing
disclosures of OIA agents' names. The Oommittee sought to determine
'what, if anything, has been done in the Pa8t to strengthen cover,
and what should be done in the future.
The Oommittee found conflicting views about 'what constihdes cover,
what it can do, and what should be done to improve it. A 19700IA
Impector General report termed the Agency's concept and use of cover
to .be lax, arbitrary, 1Jneven, confused, and loose. The present C01'er
staff in the OIA cOn8idered the 1970 a8sessment to be simplistic and
overly harsh. There is no question, however, that some improvements
and changes are needed.
The Oommittee finds that there is a basic temwn between maintaining
adequate cover and effectively engaging in oversea8 intelligence
activities. Alm.ost every operational act by a 01A officer under cover in
the fieldr-from working with local intelligence and police to attempting
to recruit agents-reveals his true purpose and chips away at his
cover. Some forms of cover do not provide concealment but offer a
certain .rkgree of deniability. Others are so elaborate that they limit
the amount of work an officer can do for the OIA. In carrying out their
responsibilities, 01A officers generally regard the maintenance of cover
as a "nuisance."
The situation of the Athens Station Ohief, Richard Welch, illustrates
the problem of striking the right balance bet1veen cover and
operations, and also the transparen<:y of cover. As the Ohief of the
CIA's Cover Staff stated, by the time a person becomes Chief of
Station, "there is not a great deal of cover left.42 The Ohief of the
Oover Staff identified terrorism a8 a further security problem for
officers oversea8, one that is aggravated by the erosion of coverY
Recommendations
49. By statute, the CIA should he permi11ted to use proprietaries
suhject to external 'and internal controls.
50. The Committee recommends that the intelligence oversight committee(
s) of Congress require at least an annual report on all proprietaries.
The report should include a statement of each proprietary's
nature and function, the results of internal annual CIA audits, a list
of all CIA intercessions on behalf of its proprietaries with any other
United States Government departments, agencies or bureaus, and such
other information as the oversight committee deems appropriate.
51. The intelligence oversight committee(s) of Congress should
require that the fiscal impact of proprietaries on the CIA's budget he
made clear in the DCI's annual report to the oversight committee. The
Commitee should also establish guidelines for creating large proprietaries,
should these become necessary.
.. For example, the CIA was concerned about the fact that the home that Mr.
Welch moved into had been previously publicly identified as belonging to the
former Station Chief. CIA officials have testified that the Agency has no evidence
that the recent congressional inquiries into intelligence activities had any adverse
impact on Mr. Welch's cover or any relationship to his tragic death.
(George Bush testimony, 4/8/76, p. 41.)
.. For explanation of italics, see footnote, p. 179.
459
52. By statute, all returns of funds from proprietaries not needed for
its operational purposes or because of liquidation or termination of a
proprietary, should be remitted to the United States Treasury as Miscellaneous
Receipts.
The Department of Justice should be consulted during the process
of the sale or disposition of any CIA proprietary.
53. By statute, former senior government officials should be prohibited
from negotiating with the CIA or any other agency regarding
the disposal of proprietaries. The intelligence oversight committee(s)
of Congress should consider whether other activities among agencies
of the intelligence community, the CIA, and former officials and employees,
such as selling to or negotiating contracts with the CIA,
should also be prohibitied as is the case regarding military officials
under 18 U.S.C. 207.
J. IXTELLIGENCE LIAISOX
Throughout the entire period of the CIA's history, the Agency
has entered into liaison agreements with the intelligence services of
foreign powers. Such arrangements are an extremely important and
delicate source of intelligence and operational support. Intelligence
channels can also be used to negotiate agreement outside the field of
intelligence. The Committee notes that all treaties require the advice
and consent of the Senate, and executive agreements must be reported
to the Foreign Relations Committee of the Senate. Because of the importance
of intelligence liaison agreements to national security, the
Committe~ is concerned that such agreements have not been systematically
reviewed by the Congress in any fashion.
}(eco~1erulation8
54. By statute, the CIA should be prohibited from causing, funding,
or encouraging actions by liaison services which are forbidden to the
CIA. Furthermore, the fact that a particular project, action, or activity
of the CIA is carried out through or by a foreign liaison service should
not relieve the Agency of its responsibilities for clearance within the
Agency, within the executive branch, or with the Congress.
55. The intelligence oversight committee (s) of Congress should be
kept fully informed of agreements negotiated with other governments
through intelligence channels. .
K. THE GENERAL COUNSEL AND INSPECTOR GENERAL
The General Counsel, as chief legal officer of the Central Intelligence
Agency, has a special role in insuring that CIA activities are consistent
with the Constitution and laws of the United States. The Committee
found that, in the past, the participation of the General Counsel
in determining the legality or propriety of CIA activities was limited;
in many instances the General Counsel was not consulted about sensitive
projects. In some cases the Director's investigative arm, the Inspector
General, discovered questionable activities that often were not
referred to the General Counsel for a legal opinion. Moreover, the
General Counsel never had general investigatory authority.
460
The Inspector General not only serves as the Director's investigative
arm, but he also aids the Director in attempts to increase the efficiency
of Agency activities. Inspector General investigations of various
Agency offices (component suneys) ha \'e been an important management
tool often leading to the discovery of questionable practices.
These component surveys were halted in 1973 but have recently been
reinstituted.
The Committee found that there were problems with the component
surveys. In some situations the Inspector General was denied access
to essential inrormation. The surveys often failed to effectively cover
sensitive programs cutting across component boundaries or raising
issues which affected the Agency as a whole. Finally, the Inspector
General's recommendations were often disregarded particularly when
the directorate being investigated opposed their implementation.
Under the President's recently issued Executive Order, the Inspector
General and the General Counsel are required to report to the Intelligence
Oversight Board any activities that come to their attention
which raise questions of legality or propriety. The Director of the CIA
is charged with assuring that those officials will have access to the information
necessary to fulfill their duties under the Executive Order.
The Committee aJso found that while both the General Counsel and
Inspector General provided valuable assistance to the Director, neither
had authority to provide assistance to the congressional oversight
bodies.
The Committee believes that the intelligence oversight committee(s)
of Congress should examine the internal review mechanisms of foreign
and military intelligence agencies and consider the feasibility of applying
recommendations such as those suggested ror the CIA.
Recommendations
56. Any CIA employee having inrormation about activities which
appear illegal, improper, outside the Agency's legislative charter, or in
violation of Agency regulations, should be required to inform the
Director, the General Counsel, or the Inspector General of the Agency.
If the General Counsel is not informed, he should be notified by the
other officials of such reports. The General Counsel and the Inspector
General shall, except where they deem it inappropriate, be required to
provide such information to the head of the Agency.44
57. The DCI should be required to report any information regarding
employee violations or law related to their duties and the results
of any internal Agency investigation to the Attorney Genera},45
.. The General Counsel and Inspector General should have authority to pass
the infonnation to the Attorney General without informin~ the head of the
A~enc~' in extraordinary circumstances, if the employee providin~ the information
so requests and if the General Counselor the Inspector General deems it
necessary.
The Inspector General should also regularly inform Agency employees about
g-rievance procedures.
'5 See 28 U.S.C. 535.
461
58. By statute, the Director of the CIA should be required to notify
the appropriate committees of the Congress of any referrals made to
the Attorney General pursuant to the previous recommendation.46
59. The Director of the CIA should periodically require employees
having any information on past, current, or proposed Agency activities
which appear illegal, improper, outside the Agency's legislative
charter, or in violation of the Agencis regulations, to report such
information.
60. By statute, the General Counsel and the Inspector General should
have unrestricted access to all Agency information and should have the
authority to review all of the Agency activities.
61. All significant proposed CIA activities should be reviewed by the
General Counsel for legality and constitutionality.
62. The program of component inspections conducted by the Inspector
General should be increased, as should the program of surveys of
sensitive programs and issues which cut across component lines in the
Agency.47
63. The Director shall, at least annually, report to the appropriate
committees of the Congress on the activities of the Office of the General
Counsel and the Office of the Inspector Genera1.48
64. By statute, the General Counsel should be nominated by the
President and confirmed by the Senate.
65. The Agency's efforts to expand and strengthen the staffs of the
General Counsel and Inspector General should be continued.49
66. The General Counsel should be promoted to, and the Inspector
General should continue to hold executive rank equal to that of the
Deputy Directors of the CIA.
.. Should the General Counselor Inspector General determine that it would
be inappropriate to notify the Director of an activity that appeared illegal,
improper, outside the Agency's legislative charter, or in violation of Agency
regulations, the General Counselor Inspector General would be required to
notify the appropriate committees of the Congress.
" The Inspector General's component surveys should consider not only the effectiveness
of the component but should also examine the component's compliance
with the legislative charter of the Agency, Agency regulations, and the law. The
Director should be required to inform the Inspector General as to what actions
have been taken on the recommendations made by the Inspector General.
<B The report should include: (a) a summary of all Agency activities that raise
questions of legality or propriety and the General Counsel's findings concerning
these activities; (b) a summarj' of the Inspector General's investigations concerning
any of these activities; (c) a summary of the practices and procedures
developed to discover activities that raise questions of legality or propriety; (d) a
summary of each component, program or issue survey, including the Inspector
General's recommendations and the Director's decisions; (e) a summary of all
other matters handled by the Inspector General.
The report should also include discussion of (a) major legal problems facing
the Agency; (b) the need for additional statutes; (c) any cases referred to the
Department of Justice. .
•• Efforts to recruit lawyers for the Office of General Counsel from outside the
CIA.should be increased. Efforts should also be made to provide for rotation of
the attorneys in the General Counsel's Office to other governmental positions.
The Inspector General's Office should be staffed by outstanding: experienced
officers drawn from inside and outside the Agency. Consideration sho'uld be given
to establishing a greater number of permanent positions within the Office. Individuals
rotated into the Inspector General's Office from another Agency office
should not be involved in surveys of offices to which they might return.
The work of both offices would benefit from regular inspections from outside.
462
L. THE DEPARTMENT OF DEFENSE
The intelligence agencies of the Department of Defense make a
major contribution to the development, management, and operation of
intelligence systems and to the production of military and technical
intelligence information. Additionally, the Department, with its
major responsibility for the nation's defense is a major user of finished
intelligence. The Committee's inquiry into the Department of
Defense intelligence agencies focused on the Department's intelligence
budget which comprises over 80 percent of the direct national United
States intelligence budget.
The Committee also examined the Defense Intelligence Agency
(DIA), the National Security Agency (NSA), and the intelligence
activities of the military services. That portion of the investigation of
NSA which centered on potential abuses is presented in detail in the
Domestic Section of the Committee's report.
1. General Findings and Oonclusions
The Committee finds that despite the magnitude of the tasks and
the complexity of the relationships, most of the important collection
activities conducted by the Defense Department (the reconnaissance
and SIGINT systems) are managed relatively efficiently and are
generally responsive to the needs of the military services as well as
to the policymakers on the national level.
Defense intelligence must respond to a range of consumers-policymakers
in Washington, defense and technical analysts, and operational
commanders in the field-yet the primary mission of defense
intelligence is to supply the armed services with the intelligence necessary
for their operations. This overriding departmental requirement
creates a major problem in the overall allocation of intelligence
resources throughout the intelligence community. In promulgating
Executive Order 11905, the Administration has decided on a greater
centralization of authority in the Director of Central Intelligence.
The Committee notes that this will require some changes in the Secretary
of Defense's authority over allocating defense intelligence
resources. With regard to intelligence resources management within
the Department of Defense, the Committee found that the establishment
of a Deputy Secretary of Defense for Intelligence should enable
more effective management of defense intelligence resources and help
the Defense Department play an appropriate role in the new centralized
interagency structure under the Director of Central Intelligence.
Increasingly, teclmological intelligence systems have grown capable
of serving both the interests of national policymakers and planners
and of field commanders. Thus, it is often difficult to distinguish
between "national" and "tactical" intelligence assets, collection, or
production. It is the Committee's view that while the effect of the
President's Executive Order giving the DCI more authority will be to
bring national intelligence assets and budgets under the DCI's control
and guidance, the defense intelligence programs which are tactical
463
in nature and integral to the military's operational commands should
remain under the control of the Secretary of Defense. The precise
line drawn between the tactical and military intelligence at any given
time will have a significant impact on the definition of national
intelligence and on the purview of any oversight committee (s) of
Congress.
92. The Defense Intelligence Agency
Even though the Defense Intelligence Agency has been the principal
agency for the production of intelligence in the Defense Department,
Secretaries of Defense and other key DOD officials have
frequently looked to other intelligence sources rather than to DIA.
For example, Robert McNamara relied heavily on the CIA; Melvin
Laird sought analyses from the Defense Department's Directorate of
Defense Research and Engineering; and J ames Schlesinger used a
special Net Assessment Group. This tendency of Secretaries of Defense
to rely on analytic resources outside of DIA is partly but not entirely,
related to dissatisfaction with DIA's performance (see the detailed
report on DIA). Another factor is the obvious difference between the
role of the Defense Department as manager of military intelligence
collection systems and the role of the Secretary of Defense as a
co-nsumer of intelligence products. For example, the Secretary's requirements
for polItical and economic intelligence are considerably
different from the intelligence needs of the operating forces and the
Joint Chiefs of Staff, who are the primary military customers of DIA.
Historically, DOD has managed the bulk of all technical intelligence
collection systems, but the CIA has managed many important national
technical collection systems and has been in charge of much of 'the
analytic function and is the primary producer of national intelligence.
The l.argest proportion of intelligence needed by the military establishment,
however, is tactical. Therefore, national intelligence is a secondary
mission of DIA. Much of DIA's effort is directed toward producing
intelligence needed by the JCS, the Unified and Specified
Commands, and force planners and technical analysts in the services.
The Secretary of Defense, on the other hand, is equally or more concerned
with national intelligence. In this context, it is not surprising
that DOD's civilian leadership has complemented DIA's product with
analyses from Sources in other agencies.
The Committee is of the view that the Secretary of Defense has a
continuing need for a strong analytical intelligence capability within
the Department of Defense. The Committee found that DIA has met
this need better than the service intelligence organizations which
preceded it, but that DIA has not fulfilled expectations that it would
provide a coordinating mechanism for all defense intelligence activities
and information.
The essential problem of the Defense Intelligence Agency was
summed up in one study commissioned by the executive branch as
"too many jobs and too many masters." 50 These problems have not
60 The Report to the President and Secretary of Defense on the Department of
Defense by the Blue Ribbon Defense Panel (Fitzhugh Report), 7/1/70.
464
been solved by the reorganizations undertaken thus far, nor has the
DIA's existence led to a diminution in the size of the separate military
intelligence services that was hoped for.
The Committee finds that the Defense Intelligence Agency faces
serious impediments to improving the quality of, and opportunities
for, its civilian and military staff. The Agency's personnel and command
structure, its lack of high-level grades, and the relatively short
tours for military officers are factors which make it difficult for DIA
to develop and retain the high-quality analytic personnel essential for
a high-quality finished product.
3. The National Security Agency
The National Security Agency is one of the largest and most technically
oriented components of the United States intelligence community.
Its basic function is collecting and processing foreign communications
and signals for intelligence purposes. NSA is also responsible
for creating and supervising the cryptography of all United
States Government agencies, and has a special responsibility for
supervising the military services' cryptologic agencies. Another
major responsibility is protecting the security of American communications.
The Committee regards these functions as vital to American security.
NSA's capability to perform these functions must be preserved.
The Committee notes that despite the fact that NSA has been in existence
for several decades, NSA still lacks a legislative charter. Moreover,
in its extensive investigation, the Committee has identified
intelligence community abuses in levying requirements on NSA and
abuses by NSA itself in carrying out its functions. These abuses are
detailed in the domestic portion of the Committee report. The Committee
finds that there is a compelling need for an NSA charter to
spell out limitations which will protect individual constitutional rights
without impairing NSA's necessary foreign intelligence mission.
4. Civilian or Military Leadership
DIA and NSA have always been headed by professional military
officers. In the case of DIA, Deputy Directors have also been military.
This past practice should not stand in the way of appointment
of any individuals, whether civilian or military, best qualified to
administer these sensitive agencies.
5. Special Issues
Several important issues concerning NSA have been revealed during
the course of the Committ's investigation which require regular reviews
by both the intelligence oversight comrr,ittee (s) of Congress
and by the executive branch.
-How can the risks involnd in the operations of collection
systems be balanced against the value of positive intellig-
ence information acquired through those operations?
-How far in the research/development process of collection
systems should the competition between agencies continue
465
before it leads to unwarranted duplication? Should those
who develop a system also manage its acquisition and subsequent
operation, or should all operations be consolidated,
for example, under the Department of Defense?
-How can the technology of advanced intelligence collection
systems be better utilized to assist the civilian and
domestic agencies of the Government without compromising
the principal mission or security of these intelligence
systems, or the open character of these portions of American
government?
Recommendations
67. In order to implement the Committee's and the President's recommendations
for expanding the DCI's resource-allocation responsibility
appropriate adjustments should be made in the Secretary of
Defense's general authority regarding Defense intelligence activities
and in the Department's internal budgeting procedures. At the same
time, there should be provision for the transfer to the Secretary of
Defense of responsibilities, particularly tasking intelligence agencies,
in the event of war.
68. By statute, the intelligence oversight committee (s) of Congress,
in consultation with the Executive, should establish a charter for the
Defense Intelligence Agency which would clearly define its mission
and relationship to other intelligence agencies. The Committee recommends
that the charter include the following provisions:
A. In order to encourage close coordination between consumers and
producers of national intelligence, DIA should be a part of the Office
of the Secretary of Defense, and should report directly to the Deputy
Secretary of Defense for Intelligence. A small J-2 staff should be
reconstituted to provide intelligence support. primarily of an operational
nature, to the Joint Chiefs of Staff. The Secretary of Defense
should ensure full coordination and free access to information between
the two groups.
B. The Director of the DIA should be appointed by the President
and subject to Senate confirmation. Either the Director or Deputy
Director of the Agency should be a civilian.
C. The Congress must relieve DIA from certain Civil Service regulations
in order to enable the quality of DIA personnel to be upgraded.
In addition, more supergrade positions must be provided for civilians
inDIA.
69. By statute, a character for the National Security Agency should
be established which, in addition to setting limitations on the Agency's
operations (see Domestic Subcommittee Recommendations), would
provide that the Director of NSA would be nominated by the President
and subject to confirmation by the Senate. The Director should
serve at the pleasure of the President but not for more than ten years.
Either the Director or the Deputy Director should be a civilian.
70. The Department of Defense should centralize the service
counterintelligence and investigative activities within the United
States in the Defense Investigative Service (DIS) in order to reduce
wasteful duplication.
466
M. THE DEPARTMENT OF STATE AND AMBASSADORS
The Department of State and the Foreign Service have an important
role in the intelligence o~erations of the United States Government.
Because of its responsibIlities in formulating and conducting U.S.
foreign policy, the State Department is a principal customer for intelligence.
Abroad, the Foreign Service, operating overtly, is the principal
collector of political intelligence and is a major collector of economic
inteligence.51
Because of its foreign policy -responsibilities and its worldwide complex
of diplomatic and consular installations, the Department of State
is the only Washington agency potentially able to oversee other U.S.
Government activities abroad-including those of the CIA. In the
field, this responsibility clearly falls on the Ambassador by law. Indeed,
Ambassadors are the sole mechanism available outside of the
CIA itself to assnre that NSC decisions are appropriately carried out
by the Clandestine Service. The Committee found that the role of the
Department of State and the Ambassadors constitute a central element
in the control and improvement in America's intelligence
operations overseas. However, the Committee also found that Ambassadors
are often reluctant to exercise their authority in intelligence
matters. The Department has not encouraged them to do so, and
the administration has not issued directives to implement existing law
covering the authority of Ambassadors.
The Committee found that in general the Department of State exercised
substantial high-level influence over decisions to undertake major
covert action programs. In the field, Ambassadors are generally
knowledgeable and often involved in significant covert activities projects.
There were, however, notable exceptions, such as the effort to
prevent Salvador Allende from coming- to power in Chile by means of
a military coup which was concealed from the Department, the Secretary
of State and the American Ambassador to Chile.
In contrast to covert action, the Committee found that neither the
State Department nor U.S. Ambassadors are substantially informed
about espionage or counterintelligence activities directed at foreign
governments. Such coordination as exists in this respect is at the
initiative of the Central Intelligence Agency and is infrequent. The
Committee found that there is no systematic assessment outside the
CIA of the risks of foreign espionage and counterespionage operations
and the extent to which those operations conform with overall foreign
policy.
In general, Ambassadors in the field are uninformed about specific
espionage activities within their countries of assig-nment. Unlike
the case of covert action, Ambassadors are not asked to appraise the
risks of espionage activities, nor to assess their benefits. Often Ambassadors
do not want to know the specifics of such operations.
and what coordination as exists in their cases is based on a g-eneral
injur.ction from them to the Station Chiefs that they not be confronted
with any "surprises."
51 The Department has often indicated in budget documents relating to intelligence
as having a bu(lget of $10 million. particularlv for the Bureau of lntl'lligence
and Research. However, the intelligence community staff estimates the
costs attributable to the function of overt intelligence collection by the Foreign
Service at $80 million.
467
That is not always enough if an Ambassador wishes to participate
in policy decisions. For example, a shift of resources toward recruitment
of internal targets in a Western country was under consideration
between Washington and the field, and the U.S. Ambassador had not
been informed. In this connection, the Committee believes it would be
unrealistic to use clandestine recruitment to try to establish the kind
of intimate relationship with political elites in friendly countries
which we have enjoyed as a result of the shared experience of 'WWIl
and its aftermath.
The Committee finds that more than a year after enactment of a
statute making Ambassadors responsible for directing, coordinating,
and supervising all U.S. Government employees within their country
of assignment,52 instructions implementing this law have still not been
issued by any quarter of the executive branch. A former Under Secretary
of State told the Committee that the law, in effect, had been
"suspended" in view of Presidential inaction. Moreover, the CIA has
not modified its practices pursuant to this law. The Committee finds
this thwa-rting of the United States law unacceptable.
The Committee finds that Ambassadors cannot effectively exercise
their legal responsibilities for a wide variety of intelligence activities
within their jurisdiction without State Department assistance on the
Washington aspects of the activities. Such support is particularly important
in the case of intelligence operations aimed at a third country.
An Ambassador may be able to judge the local risks of an espionage
effort, but if it is directed toward a third country the Ambassador
may not be able to assess the importance or value of the effort without
Washington support.
In the past, the Department of State, at least, has not 'had a parallel
responsibility nor the right of access to information necessary to
enable it to provide support to an Ambassador seeking to exercise
his statutory responsibility over CIA espionage and counterespionage
operations. The Committee notes section 4 in Executive Order No.
11905 of February 18, 1976 which may be intended to provide such
State Department back-up for Ambassadors.
At present, the CIA handles both State Department and its own
communications with overseas posts. Under this a-rrangement, the Ambassador's
access to CIA communications is at the discretion of the
CIA. The Committee finds that this is not compatible with the role
assigned to the Ambassador 'by law; the Ambassador cannot be sure
that he knows the full extent and nature of CIA operations for which
he may be held accountahle.
The Committee finds that Ambassadors' policies governing intelligence
activities have sometimes been interpreted in a manner which
vitiated their intent. For example, one Ambassador prohibited any
electronic surveillance by his Embassy's CIA component. The head of
the CIA component interpreted this to proscribe only CIA electronic
surveillance and believed that such surveillance could be conducted
in cooperation with local security services.
52 22 U.S.C. 2680a. The instructions preplared by the State Department and forwarded
to the NSC have been opposed by the CIA on the grounds that the CIA
still has a responsibility to protect sources and methods from unauthorized disclosure.
The NSC has not acted on the proposed instructions.
468
The Committee found evidence that CIA Station Chiefs abroad do
not always coordinate their intelligence reporting on local developments
with their Ambassadors. The Committee does not believe that
Ambassadors should be able to block CIA field reports. However, it
found that there was no standard practice for Ambassadors to review
and comment on intelligence reporting from the field.
The Committee finds that the Foreign Service is the foremost producer
in the United States Government of intelligence on foreign
political and economic matters. The Committee believes, however, that
the State Department does not adequately train Foreign Service
personnel, particularly in political reporting. Nor does the Department
fund their collection ope,rations, nor manage their activities so as
to take full advantage of this extremely important intelligence capability.
In effect, the Department, despite being a' major source of
intelligence, considers this function secondary to its principal task of
diplomatic representation and negotiations.
From discussions in nearly a dozen foreign service posts, the Committee
established that there is inadequate funding for Foreign Service
reporting officers to carry out their responsibilities. The funds available
are considered ".representation funds" and must be shared with the
administration and consular sections of most embassies. Such representation
funds have been a favoritei:arget for congressional cuts in the
State Department budget.
Recommendations
71. The National Security Council, the Department of State, and the
Central Intelligence Agency should promptly issue instructions implementing
Public Law 93--475 (22 U.S.C. 2680a). These instructions
should make clear that Ambassadors are authorized recipients of
sources and methods information concerning all intelligence activities,
including espionage and counterintelligence operations. Parallel instructions
from other components of the intelligence community
should be issued to their respective field organizations and operatives.
Copies of all these instructions should be made available to the intelligence
oversight committee (s) of Congress.
72. In the exercise of their statutory responsibilities, Ambassadors
should have the personal right, which may not be delegated, of access
to the operational communications of the CIA's Clandestine Service
in the country to which they are assigned. Any exceptions should have
Presidential approval and should be brought to the attention of the
intelligence oversight committee (s) of Congress.
73. By statute, the Department of State should be authorized to take
the necessary steps to assure its ability to provide effective guidance and
support to Ambassadors in the execution of their responsibilities under
Public Law 93--475 (22 U.S.C. Sect. 2680a).
74. Consideration should be given to increasing and ea.rmarking
funds for Foreign Service overt collection of foreign political and
economic information. These funds might be administered jointly by
the State Department's Bureau of Intelligence and Research and the
Bureau of Economic Affairs.
75. The NSC should review the question of which U.S. Government
agency should control and operate communications with over469
seas diplomatic and consular posts, including the CIA, and other
civilian agencies operating abroad.
76. The Department of State should establish specific training programs
for pOlitical reporting within the Foreign Service Institute,
and place greater emphasis on economic reporting.
N. OVERSIGHT AND THE INTELLIGENCE BUDGET
The Committee finds that a full understanding of the budget of
the intelligence community is required for effective oversight. The
secrecy surrounding the budget, hO'wever, makes it impossible for
Congress as a whole to make use of this valuable oversight tool.
Congress as a body has never explicitly voted on a "budget" for
national intelligence activities. Congress has never voted funds specifically
for CIA, NSA, and other national intelligence instrumentalities
of the Department of Defense.54
The funding levels for these intelligence agencies are fixed by subcommittees
of the Armed Services and Appropriations Committees
of both Houses. Funds for these agencies are then concealed in the
budget of the Department of Defense. Since this Departmental budget
is the one Congress approves, Congress as a whole, and the public,
have never known how much the intelligence agencies are spending
or how much is spent on intelligence activities generally. Neither Congress
as a whole, nor the public can determine whether the amount
spent on intelligence, or by the intelligence agencies individually, is
appropriate, given the priorities.
Because the funds for intelligence are concealed in Defense appropriations,
those appropriations are thereby inflated. Most members
of Congress and the public can neither determine which categories
are inflated nor the extent to which funds in the inflated categories are
being used for purposes for which they are approved.
Finally, the Committee believes there is serious question as to
whether the present system of complete secrecy violates the constitutional
provision that:
No Money shall be drawn from the Treasury but in Consequence
of Appropriations made by Law; and a regular Statement
and Account of the Receipts and Expenditures of all
public Money shall be published from time to time.55
The Committee believes that the overall figure for national intelligence
activities can be made public annually without endangering
national security or revealing sensitive programs.56 The Committee
carefully examined the possible impact of such disclosure on the
sources and methods of intelligence gathering and believes it to be
minimal. The Committee found that the primary concern about this
.. Funds for the intelligence activities of the Department of State. ERDA, and
the FBI are reviewed by the appropriate cOIIlgressional committees and are voted
upon by Congress as a whole, when CongresS' appropriates funds for these
agencies.
"United States Constitution, Art. 1. Sec. 9 CIs. 7.
00 The Committee noted that the Special Senate Committee to Study Questions
Related to Secret and Confidential Government Documents, chaired by Senators
~fansfield and Scott cOOlcluded that the aggregate figure for each intelligence
agency should be made public.
470
level of disclosure was that it would lead to pressure for even more
detailed revelation which would compromise vital intelligence
programs.
The Committee believes that disclosure of an aggregate figure for
national intelligence is as far as it is prudent to go at this stage in reconciling
the nation's constitutional and national security requirements.
Publlc speculation about overall intelligence costs would be eliminated,
the public would be assured that funds appropriated to particular
government agencies were in fact intended for those agencies, and
both Congress and the public would be able to assess overail priorities
in governmental spending.
Tohe Committee's analysis indicated that billion constitutes
the direct costs to the United States for its national intelligence
program for FY 1976. This includes the total approved budgets of
CIA, DIA, NSA and the national reconnaissance program.57 If the
cost of tactical intelligence by the armed services and indirect support
costs 58 which may be attributed to intelligence and intelligence-related
activities is added, the total cost of U.S. Government intelligence activities
would be twice that amount. This represents about three percent
of the total federal budget, and about eight percent of controllable
federal spending.
It should be stressed that this larger estimate represents a full cost
and includes activities which also fulfill other purposes. Thus the entire
amount could not be "saved" if there were no mtelligence activities
funded by or through the Defense Department.
The CIA's budget for the fiscal year is contained in the Defense
Department budget. The Committee found that the CIA spends
approximately 70 percent more than it is appropriated, with the additional
funds coming from advances and transfers from other agencies.
These transfers and advances are made with the knowledge and approval
of OMB and the appropriate congressional committees. The use
of advances and transfers between agencies is a common governmental
practice. In this case the CIA receives funds as the contracting agent
for agencies in the Defense Department as well as other intelligence
community agencies.
Recommeruiati0118
77. The intelligence oversight committee(s) of Congress should
authorize on an annual basis a "National Intelligence Budget," the
total amount of which would be made public. The Committee recommends
that the oversight committee consider whether it is necessary,
given the Constitutional requirement and the national security demands,
to publish more detailed budgets.
78. The intelligence oversight committee(s) of Congress should
monitor the tactical and indirect support accounts as well as the national
activities of intelligence agencies in order to assure that they are
kept in proper perspective and balance,
57 The direct costs of the intelligence activities of the ERDA, FBI, and State
Department are contained in their respective bUdgets.
58 Indirect support costs include costs for personnel, operations and maintenance
which support intelligence activities. Examples are the operatiQn of training facilities,
supply !lases, and commissaries.
471
79. At the request of the intelligence oversight committee(s) of Congress
and as its agent, staff members of the General Accounting Office
should conduct full audits, both for compliance and for management
of all components of the intelligence community. The GAO should
establish such procedures, compartmentation and clearances as are
necessary in order to conduct these audits on a secure basis. In conducting
such audits, the GAO should be authorized to have full access
to all necessary intelligence community files and records.
O. CHEMICAL AXD BIOLOGICAL AGENTS AND THE INTELLIGENCE
COMMUNITY
The Committee investigated the testing and use of chemical and
biological agents by agencies within the intelligence community. The
testing programs originated in response to fears that countries hostile
to the United States would use chemical and biological agents against
Americans or our allies. Initially, this fear led to defensive programs.
Soon this defensive orientation became secondary as the possibility of
using these chemical and biological agents to obtain information from,
or to gain control of, enemy agents, became apparent.
The Committee found that United States intelligence agencies engaged
in research and development programs to discover materials
which could be used to alter human behavior. As part of this effort, 'testing
programs were instituted, first involving witting human subjects.
Later, drugs were surreptitiously administered to unwitting human
subjects.
The Agency considered the testing programs highly sensitive. The
Committee fonnd that few people within the agencies knew about
them; there is no evidence that Congress was informed about them.
These programs were kept from the American public because, as the
Inspector General of the CIA wrote, "the knowledge that the Agency
is engaging in unethical and illicit activities would have serious repercussions
in political and diplomatic circles and would be detrimental
to the accomplishment of its [CIA's] mission."
The research and development program and particularly the testing
program involving unwitting human subjects involved massive
abridgements of the rights of individuals, sometimes with tragic consequences.
The deaths of two Americans resulted from these programs;
other participants in the testing programs still suffer residual
effects. 'Vhile some controlled testing for defensive purposes might be
defended, the nature of the tests, their scale, and the fact that they
were continued for years after it was known that the surreptitious
administration of LSD to unwitting subjects was dangerous, indicate
a disregard for human life and liberty.
The Committee's investigation of the testing and use of chemical
and biological agents also raised serious questions about the adequacy
of command and control procedures within the CIA. The Committee
found that the Director waived the CIA's normal administrative controls
for this development and testing program in order to assure its
security. According to the head of the CIA's Audit Branch, the
waiver produced ",!~TOSS administrative failures." The waiver prevented
the internal review mechanisms of the Agency-the Office
472
of the General Counsel, the Inspector General, and the Audit Stafffrom
exercising adequate supenision of the program. The waiver had
the paradoxical effect of providing looser administrative controls and
less effective internal review of this controversial and highly sensitive
project than existed for normal Agency activities.
The Committee found that the security of the program was protected
not only by the waiver but also by a high degree of compartmentation
within the CIA. This resulted in excluding the CIA's
Medical Staff from the principal research and testing program inyolying
the effect of chemical and biological agents on human subjects.
The Committee also found that within the intelligence community
there were destructive jurisdictional conflicts over drug testing. Military
testers withheld information from the CIA, ignoring their su'periors'
suggestions for coordination. The CIA similarly .failed to provide
information on its programs to the military. In one case the
military attempted to conceal its overseas operational testing of LSD
from the CIA and the CIA attempted surreptitiously to discover the
details of the military's program.
Recommendations
80. The CIA and other foreign and foreign military intelligence
agencies should not engage in experimentation on human subjects
utilizing any drug, device or procedure which is designed, intended,
or is reasonably likely to harm the physical or mental health
of the human subject, except with the informed consent in writing,
witnessed by a disinterested third party, of each human subject, and
in accordance with the guidelines issued by the Kational Commission
for the Protection of Human Subjects for Biomedical and Behavioral
Research. Further, the jurisdiction of the Commission should be
amended to include the Central Intelligence Agency and the other intelligence
agencies of the United States Government.
81. The Director of the Central Intelligence Agency and the Secretary
of Defense should continue to make determined efforts to locate
those individuals involved in human testing of chemical and biological
agents and to provide follow-up examinations and treatment, if
necessary.
P. GEXER...\L REcoM:\I:EXDATIONS
82. Internal Regulations-Internal CIA directives or regulations
regarding significant Agency policies and procedures should be
waived only with the explicit written approval of the Director of
Central Intelligence. "\Vaiver of any such regulation or directive
should in no way violate any law or infrin~e on the constitutional
right and freedom of any citizen. If the DCI approves the waiver or
amendment of any significant regulation or directive, the NSC and
the appropriate congressional oversight committee (s) should be notified
immediately. Such notification should be accompanied by a
statement explaining the reasons for the waiver or amendment.
83. Security Clearances-In the course of its investigation, the
Committee found that because of the many intelligence agencies participating
in security clearance investigations, current security clearance
procedures involve duplication of effort, waste of money,
and inconsistent patterns of investigation and standards. The intelli473
gence oversight committ~e(s) of Congress, in consultation with the
intelligence community, should consider framing standard weurity
clearance procedures for all civilian intelligenc~ agencies and background
checks for congressional committees when security clearances
are required.
84. Personnel Practices-The Committee found that intelligence
agency training programs fail to instruct personnel adequately on the
legal limitations and prohibitions applicable to intelligence activities.
The Committee recommends that these training programs should be
expanded to include review of constitutional, statutory, and regulatory
provisions in an effort to heighten awareness among all intelligence
personnel concerning the potential effects intelligence activities
may have on citizens' legal rights.
85. Security Functions of the Intelligence Agencies-The Committee
found that the security components of intelligence agencies sometimes
engaged in law enforcement activities. Some of these activities
may have been unlawful. Intelligence agencies' weurity functions
should be limited to protecting the agencies' personnel and facilities
and lawful activities and to assuring that intelligence personnel follow
proper security practices. (See the Committee's Final Report on
Domestic Intelligence, section on Intelligence Activities and the Rights
of American Citizens, p. 304.)
86. Secrecy and Authorized Disclosure-The Committee has received
various administration proposals that would require persons
having access to classified and sensitive information to maintain the
secrecy of that information. The COlllmittee recommends that the issua')
raised by these proposals be considered by the new legislative intelligence
O\'el'sight committee (s) of Congress and that, in recasting
the H)47 Xational Security Act and in consultation with the executive
branch, the oversight corilmittee (s) consider the wisdom of new seerpcy
and disclosure legislation. In the vie,,- of the Committee any such
consideration should include carefully defining the following terms:
-national secret;
-sources and methods;
-lawful and unlawful classification;
-lawful and unlawful disclosure.
The new legislation should provide civil and/or criminal penalties for
unlawful classification and unlawful disclosure. The statute should
also provide for internal departmental and agency procedures for
employees who believe that classification and/or disclosure procedures
are being improperly or illegally used to report such belief. There
should also be a statutory procedure whereby an employee who has
used the Agency channel to no avail can report such belief without
impunity to an "authorized" institutional group outside the agency.
The new Intelligence Oversight Board is one such group. The intelligence
oversight committee (s) of Congress would- be another. The
statute should specify that revealing classified information in the
course of reporting information to an authorized group would not
constitute unlawful disclosure of classified information.
87. Federal Register for Classified Executive Orders-In the course
of its investigation, the Committee often had difficulty locating classi-
207-932 0 - 76 - 31
474
fied orders, directives, instructions, and regulations issued by various
elements ot the executive branch. Access to these orders by the intelligence
oversight committoo(s) ot Congress is essential to intormed
oversight ot the int€lligence community.
The Committee recommends that a Federal Register tor classified
executive orders be established, by statute. The statute should require
the registry, under appropriate security procedures, ot all executive
orders-however they are labeled--eoncerning the intelligence activities
ot the United States. Among the documents tor which registry in
the Classified Federal Register should be required are all National
Security Council Intelligence Directives (NSCIDs), and all Director
ot Central Intelligence Directives (DCIDs). Provision should be
made tor access to classified executive orders by the intelligence
oversight committee (s) ot Congress. Classified executive orders
would not be lawtul until filed with the registry, although there
should be provision for immediate implementation in emergency situations
with prompt subsequent registry required.

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