ANNUAL REPORT

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP05T00644R000100020001-1
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 18
• Document Creation Date: December 22, 2016
• Document Release Date: April 30, 2009
• Sequence Number: 1
• Publication Date: January 7, 1980
• Content Type: MEMO

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The Director of Central Intelligence !l,n.aetr* log,dkz,i
%Vashington. D C.20505 pO -n _
8 JAN 1980
MEMORANUM FOR: Deputy Director of Central Intelligence
Director, Defense Intelligence Agency
Director, National Security Agency
Director, Bureau of Intelligence and Research,
%, Department of State
SUBJECT : Annual Report
1. I very much appreciated your contributions to the Annual Report
which will be provided Congress on 24 January. Attached is my overview.
Would you review it with particular reference to the Community goals for
1980 listed on pages 15 and 16 and provide me with your comments by
16 January 1980.
2. This edition of the overview is provisionally classified
Confidential. My intention is to publish it as unclassified once you have
reviewed it and I have made sure that no classified material will be
released. Your chapters, of course, will be published at the level you
have classified them.
/s/ Stansfield Turner.
STANSFIELD TURNER
Attachment:
as stated
Distribution:
1 - Each Addressee
1 - DCI
1 - ER
1 - D/PG0/RMS
Q1 - SA/DCI
1 - PB/NSC
DCI/PB/NSC/
(7 January 1980)
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CONFIDENTIAL
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7 January 1980
The Intelligence Community in 1979:
Annual Report of the Director of Central Intelligence
The Intelligence Community faced three major challenges in 1979:
I. To improve the quality of political and economic intelligence in the
face of rapidly and sometimes profoundly changing requirements;
II. To ensure that we could effectively carry out our many monitoring
responsibilities despite the loss of some capabilities and the heavy
demand placed on others; and
III.To adjust and respond positively to the effects of active Congres-
sional oversight and new legislation.
Our response to these challenges this year demonstrated the enduring good
health of the United States' intelligence services and their growing ability to
function as a Community. Because these challenges will remain with us for
the foreseeable future, we must continue to strengthen the Community's capabilities
in collection and analysis in order to anticipate the problems of tomorrow and
deal with them effectively. This report, consequently, assesses the Intelligence
Community's performance in 1979 from two perspectives:
-- The major challenges and how they were met
-- The primary lessons learned and their implications for our
future direction and capability
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I. Improving Political and Economic Intelligence
I. To improve the quality of political
and economic intelligence in the
face of rapidly and sometimes
profoundly changing requirements.
For the Intelligence Community, the year ended as it began: with attention
focused on Iran. Our experience there underscores the importance of sensitivity
to broad trends and underlying social, political, and economic forces that
will shape the international environment in the 1980s. How well-equipped are
we today to detect these kinds of social and political changes, changes that
could threaten U.S. interests elsewhere?
When the government of the Shah fell, the Intelligence Community was
criticized for not predicting the event in advance. The real issue here is not
whether we were able to predict the moment of the Shah's fall. There were no
written plans for the kind of revolution which occurred in Iran. The moment
when disparate forces coalesce behind an obscure or unlikely leader is a moment
of spontaneity usually unforeseen even by the participants. While predicting
such events is certainly to be strived for, it is only the final step in a
continuing process of warning, whose earlier steps are probably more important
because they give the policymaker the time and the option to act.
Consequently, the real issue is how well we alerted the policymaker over
the years to the drift in Iran, to the mounting challenges to the Shah, and to
the increasing likelihood of revolution at some unspecified time. As a country
moves toward revolution, certain trends can be assessed and the policymaker
alerted. We did reasonably well in these areas, but we can and should do
better. Even more importantly, we must be able to sense such trends over a
wider range of countries than ever before. This means being able to formulate
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better reporting requirements that alert us to what is happening throughout
society, and finding the means to sensitize analysts to the more subtle and
fundamental forces at work.
Early in 1979 we moved as a community to improve the quality of political
reporting on potentially unstable areas. A key element to this effort has been
the Political Intelligence Working Group, composed of the Under Secretary of
State, the Deputy to the President's Assistant for National Security, and
the Deputy Director of Central Intelligence. This group has developed a list of
critical countries and current concerns. It has sharpened the definition
of requirements in these areas. The result has been better coordination and
more focused collection and production. Through the Policy Review Committee
(Intelligence), top policymakers have also defined their longer term intelligence
interests and needs and expressed them as National Intelligence Topics. The
Deputy Director for National Foreign Assessment has taken the lead in assuring
that the Community developed a coordinated production strategy for addressing
these Topics in 1979-1980, and the Deputy Director for Collection Tasking has
formulated the collection objectives, tasks, and priorities to support the
production effort with the necessary informational input.
Detecting Beyond these institutional responses, we are examining and writing more
societal
change about trends in developing countries and other societies undergoing stress. We
are in the process of determining which indicators will tell us the most about
what is happening. Within CIA, an inter-directorate study group is identifying
and testing a method to tap into significant opinion making groups in selected
countries. Here it must be recognized that the dividing line between "intell-
igence" that is obtained through clandestine contacts and "reporting" that is
traditionally done from open contacts by foreign service officers and others is
a narrow but real one. The best of both will be increasingly needed. We will
have to coordinate carefully our intelligence efforts with the information-
gathering activities of the State Department and other Government agencies.
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Economic Astute economic intelligence is also increasingly essential to foreign
intel-
ligence policy. Political relations among nations will be shaped in part by the adequacy
of essential energy supplies and access to other raw materials. As 1979 closed,
for instance, the United States was instituting economic pressures on Iran and
weighing the effects of possible loss of Iranian oil production. Policymakers
will expect intelligence to signal potential stringencies, to interpret their
political effects, and to continue supporting ongoing international economic
negotiations.
This year we increased our attention to the economic problems of key
LDCs and to developing multidisciplinary task forces to study major resource
issues. The Petroleum Supply Analysis Center, for example, combines all relevant
technical disciplines and involves the entire community in its studies. This
Center serves the policymaker with estimates of oil production possibilities of
key producers and analyses of the technical implications of production policy
decisions. Additionally, we increased our support to U.S. negotiators at
international economic conferences and, with the Department of Commerce, have
developed a mechanism for sharing more unclassified economic intelligence work
with the U.S. business community.
Balanced As the Iranian experience has shown, it is essential to strike a balance
analytic
effort between current intelligence and the analysis of trends against a larger
backdrop. Yet requests for current intelligence--an appraisal of fast-breaking
events or support in a crisis--place a heavy burden on the analysts' time and
exact a toll on long-range work. It is with this in mind that I authorized
creation of the National Intelligence Council in December to ensure, in part,
that a conscious Community effort is made to enhance our capacity for estimative,
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multidisciplinary analysis. Developing the skills required for this type of
analysis is a long-term process, and one that philosophically views
each analyst as a soldier, trained and ready, though perhaps never called on. A
prime challenge we face in developing such depth within the Community is to keep
the motivation of our people high, though a dramatic requirement for their
skills may be rare.
Much remains to be done throughout the Community to improve the quality of
political analysis and integrating it with economic intelligence. It will be
especially important to increase the focus on countries where there is high
probability of societal change. We must understand better the historical,
cultural, and religious forces driving such change, and strengthen the base of
political and economic intelligence so that we will be ready for shifts in
policy attention as events unfold.
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II. Monitoring Responsibilities
II. To ensure that we could effectively
carry out our many treaty monitoring
responsibilities despite the loss
of some capabilities and the heavy
demand placed on others
Throughout 1979, the entire spectrum of our monitoring capabilities was
put to the test.
Shortly thereafter, we
formally became responsible for monitoring the most comprehensive and complex
arms control treaty ever negotiated. And, events in the Middle East, Asia, and
Central America put a heavy and almost constant burden on our crisis monitoring
capabilities. There were thus three primary dimensions to this challenge:
preparing to monitor the SALT-II Treaty, assuring that we could handle SALT
along with our other responsibilities, and establishing priorities that effectively
allocated our collection assets.
Perhaps the most difficult was in the area of SALT. SALT II contains
Extensive Congressional
hearings were held to ascertain our ability to perform each of these monitoring
tasks.
The review of our strategic nuclear monitoring capabilities posed a
number of special problems. In the national debate over the SALT
II Treaty, both the public and the media sought to draw the Intelligence
Community in as either proponent or opponent of the Treaty. The Community
cannot under any circumstances permit itself to be used as an advocate of
CTIN F IUE T A
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any policy without forsaking its most important contribution: the provision of
credible, unbiased intelligence, uninfluenced by any policy considerations.
Therefore, the Intelligence Community scrupulously carried out its proper role
of providing an impartial and necessarily classified assessment of how well we
could check on or monitor each provision of the Treaty to both the President and
the Congress. We scrupulously eschewed expressing opinion on the adequacy of
verification because such a judgment can only be made in the light of policy
alternatives.
Teamwork is also essential to the Community's effectiveness in monitoring
compliance with numerous other arms control treaties and agreement i supporting
ongoing negotiations, and assessing Warsaw Pact orders of battle and deployments
to forward areas as well as the activities of other key foreign military forces.
Monitoring conventional force developments and deployments is especially
important in assessing the elements of competition in the overall U.S.-USSR
relationship. It is essential for policymakers to know, for example, when
changes in order of battle or forward area deployments signal genuine shifts in
political and strategic military objectives. Compared to keeping track of
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face a formidable analytic challenge.
the strategic balance, monitoring such developments is extremely difficult. In
most cases, there are no treaties to specify limits and prohibitions on what
can be developed or deployed. Nor can we afford to devote the same level of
effort to monitoring conventional forces that we do SALT. Even if we could, we
such as those deployed to forward areas, 25X1
and still more 'difficult to know their purpose. This is essentially the problem
we faced with the Soviet brigade in Cuba.
This experience underscores the importance of a community approach to
collection and analysis. The intelligence breakthrough in August was a team
effort. The experience also demonstrated the value of amassing a large data
base and the effectiveness of our system to index and store such information.
Had this information not been available, it would have been impossible to trace
the origins of the Soviet force and document in retrospect the evolution of the
build-up.
Korea A similar team effort was required to reassess our evidence and judgments
about the size and order of battle of the North Korean army. While one component
of the community pushed ahead with its work in locating new units, its findings
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were shared with other components to facilitate independent verification of the
data. Through such coordinated analysis we were able to develop a new assessment
of the Order of Battle of another extremely difficult monitoring problem.
product of fine teamwork between our various disciplines for collecting data.
Priorities Other crises in the Far East, the Middle East, and Central America also tested
the Community's ability to establish priorities and allocate a limited number of
China- collection assets. The outbreak of hostilities between China and Vietnam, for
Vietnam
example, confronted us with the problem of how best to allocate these assets.
Obviously, intense interest in the hostilities required that we cover them on a
daily basis. But we also had to make sure that other targets of equal or even
greater long-term priority in the area were covered as well, e.g., Korean
warning. If crises alone drive collection, we risk being in a poor position to
anticipate other developments which might become more significant. Hag do we
decide between conflicting priorities?
Executive Order 12036 set up the National Intelligence Tasking Center to
bring the best combination of the Community's collection assets to bear on
problems in accordance with the national priorities established by the NSC and
to resolve any conflicts of priority which may later develop. During the
Sino-Vietnamese crisis the NITC demonstrated its ability to adjudicate priorities
Nicaragua
and maintain coverage with limited collection resources. Our concern over
the situation in Nicaragua last summer and the eventual takeover there by the
Marxist-led National Front also necessitated adjustments of collection efforts
in the Caribbean area, because this coincided with our heightened efforts to
monitor the Soviet presence in Cuba.
C RL '11 F11 ENT I AL
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Iran,
Afghan-
istan
Tactical
support
In the Fall, we faced conflicting priorities and competition for
resources in covering crises in Iran, Afghanistan and related areas of the
Moslem world. Greater attention was paid to coverage of Afghanistan during the
period of the Amin coup in September 1979, before the onset of the Iranian
crisis. In November, the takeover of our Embassy made collection on Iran
our highest priority. When the Soviet Union began its massive military build-up
in preparation for invading Afghanistan in early December 1979, conflicts
in priority targeting arose because collection on neighboring Iran remained
critical. The collection managers mobilized assets across the board to cover the
entire Iranian/Afghan/Soviet border/Persian Gulf areas as an entity. This
regional approach permitted the sharing of scarce resources for collection on
priority targets in neighboring countries.
It is appropriate to note at this point that the activities of the Community
are not focused solely on national needs. Our capabilities are such that they
can supplement the tactical assets of our military forces in the field. The
interface between national and tactical systems is a complex one, but we are in
the process of developing these relationships through a series of cooperative
tests with the military forces. Between April 1978 and March 1979, the
Intelligence Community supported three major tests sponsored by the Joint Chiefs
of Staff. These exercises permit us to take the theory behind the interface and
subject it to the exigencies of the real world to determine how we can most
effectively support tactical forces overseas.
In sum, our experience in 1979 demonstrated the need for versatility
and a surge capacity in monitoring systems. The versatility is there..
Through the NITC we can shift priorities rapidly from one area to another and
program collection systems to intensify coverage of trouble spots. But our
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capability to do so within current resource levels and without degrading other
monitoring responsibilities is limited. Until these capabilities are enhanced,
it will be the job of the NITC to balance competing requirements with the
resources available.
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III. Oversight and Legislation
III. To adjust and respond positively
to the effects of active Congressional
oversight and new legislation.
It is essential for an intelligence service to conduct its operations in
secret and to protect the sources and methods by which it gathers information.
The American Intelligence Community must also operate within legal constraints,
must not infringe on the legal rights of American persons, and must be
accountable for its actions. The Intelligence Community today is too big, too
public to enjoy the same degree of secrecy that it did a decade ago. The
investigations between 1974 and 1976 have fundamentally changed the environment
in which we must operate. Today, therefore, we must adjust to greater legislative
restrictions, greater oversight, and greater openness, while at the same time
protecting our sources and methods of collecting information as well as the
information itself.
Congressional oversight has been thorough and constructively critical
of our operations, our finances, and our product. Such active oversight,
coupled with the frequent appearances of Community leaders before Congres-
sional Committees, has benefited us. It has increased understanding of our
role, and helped generate important Congressional support for necessary resources
and for an enhanced capability to protect secrets.
The House Permanent Select Committee on Intelligence, for example, has
introduced a bill, co-sponsored by the entire Committee to provide criminal
penalties for the unauthorized identification of individuals engaged or assisting
in U.S. foreign intelligence activities. I consider the passage of this bill
vital to our future effectiveness.
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We are also grateful for the intention of the Senate Select Committee on
Intelligence to address the "Identities" issue in the 2d Session of the 96th
Congress, as well as their major effort to write new Charter Legislation for
the Intelligence Community. Such legislation would help resolve many of the
difficulties in interpreting the impact of the complex of rules and regulations
recently applied to intelligence agencies. The SSCI's draft Charter Legislation
also addresses not only the "Identities" problem, but such other critical issues
as the modification of the Hughes-Ryan amendment and partial relief from the
Freedom of Information Act.
There are, of course, risks inherent in any process that details our
budget, clandestine operations, and key analytic findings. The danger that
sensitive sources and methods will be disclosed is unquestionably increased in
direct proportion to the number of people who know them, irrespective of who
they are. Leaks continue to be one of our most serious problems. I have
written to the Attorney General and to the chairmen of the appropriate Congres-
sional Committees to alert them to unauthorized disclosures of classified
information and to stress the damage which may result. The more serious
breaches of security have been referred to the FBI for investigation.
While we will continue to investigate every instance of a security
breach, I am pursuaded that our best insurance against leaks is a two-pronged
effort. On the one hand, we are purging the system of that which can be
declassified, thus reducing the material which must be safeguarded and
thereby increasing respect for it. On the other hand, we are protecting
better that which remains classified. The President's approval, just at
year's end, of a new system of codeword security will do much to assist us in
this latter direction.
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IV. Future Directions
The Intelligence Community is moving into a more demanding time than
ever before. In the 1980s, the trend toward upheaval in the Third World
will continue as social and political forces struggle with the problems of
modernization and accelerated change. Understanding the nature and dynamics
of such struggles, and alerting policymakers as to how they may threaten free
world interests will remain high on the Intelligence Community's agenda. At
the same time, the elements of competition in the U.S.-USSR relationship will
place a heavy burden on our ability to monitor key military and political
developments in an effort to anticipate and help avoid crises. Relations
among the industrialized countries and between them and key Third World states,
moreover, will be complicated by differences in approach to potential crises,
as well as by conflicts about the goals of energy, security, and nuclear non-
proliferation policies--all topics on which policymakers will expect perceptive
analyses.
If the Intelligence Community is to continue to be responsive to policy-
makers, we can no longer concentrate as predominantly on Communist military
activities, our primary focus for the past 30 years. There is a clear need
to rethink the traditional balance of our collection and analytical efforts
between the "hard targets" (the USSR, Eastern Europe, and China) and the Third
World, as well as the balance between resources devoted to science and technology
and military subjects, as opposed to political and economic subjects. Currently
for example, over seventy five percent of the production analysts in the Community
work on S&T or military subjects. Less than twelve percent deal with political
issues. In the period ahead, our concerns with politics, economics, food
resources, energy, population growth, narcotics, international terrorism,
technology transfer, and a host of other forces which affect the relations of
nations will certainly continue to grow.
C
,-FIB ITIAL
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Because of this increasing breadth of intelligence interests we will be
compelled to develop better strategies to assure balance between our capability
to collect intelligence through technical means and our capability to satisfy
requirements through agents in the field. The more information technical systems
provide us, the more questions are raised. Generally, a photograph or a signals
intercept reveal something that is different from what has been observed in the
past. The policymaker then asks why there has been a change and what may happen
next. Discerning motivations, intentions, and future plans is the forte of the
human intelligence agent. Rather than devaluing the traditional agent, therefore,
our burgeoning technical collection capabilities increase the importance of
human collection. The challenge here will be to coordinate vast quantities of
technically collected information with the human intelligence effort so that
they enhance one another.
In the sections that follow, the leaders of the major Intelligence Community
components report on specific issues and problems which concern them and which
will require special emphasis over the next several years. These issues, as
well as the ones which I have raised in this overview, underlie the Intelligence
Community's goals for 1980:
(1) -- To develop better means of anticipating the major challenges for
intelligence over the next decade and their affect on future
collection and analytical requirements
(2) -- To strengthen the base of in-depth, multidisciplinary analytic
expertise
(3) -- To evaluate the-management and quality of national intelligence
estimates and memoranda, with particular emphasis on their time-
liness and on their utility to principal policy consumers
CI,F Uf
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(4) -- To develop the techniques both for the collection against
and analysis of long-term societal change in the Third
World.
(5) -- To enhance coordination of Community-wide research and
analytic production on National Intelligence Topics of Long
Term interest
(6) -- To assist the Congress in ensuring that Charters Legislation
provides for adequate Community accountability, yet permits the
degree of flexibility which is indispensable to effective
intelligence work.
These objectives will help focus the skills we have as a Community to respond to
the challenges that face the nation. They will help assure continued progress in
fashioning an American model of intelligence, one that is consistent with our
traditions, responsibilities, and resources.
C FI ETU
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