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Approved Foroease 2002/10/09: CIA-RDP64-006540200130001-6 CHAPTER I Approved For Release 200SE;E-RDP64-00654A000200130001-6 Approved For4pease 2002/10/09: CIA-RDP64-0065 00200130001-6 MCANIZATTONAL HISTORY OF C 14'7RA UiTI LLIO CP Ar T; C!, 1l138'~ hapter: Pages: I. Background, 19146-1950 53 II. Major Organizational Revision 93 III. Inter-Agency Coordination Problems 48 IV, The Conduct of Overt Collection 306 V. Development of a Reference Center 84 VI. Problezs of Scientific and Intelligence 80 VII. Economic., Geographic, and Basic Intelligence 83 VIII. Current Intelligence and hostility Indications 59 IT. Production and Coordination of Intelligence Estimates 182 7. The Conduct of Agency RasinssS 169 A. President Truman's Letter, January 22, 19156 B. Selected Organization Charts of GIG and CIA, ]9) 6-53 C. Directives of the National Intelligence Authority (NIA's) D. CIA Legislation of 1917, 1919, and 1951 E. NSC Intelligence Directives and DCI Directives, 19157-53 F. List of OIC Projects, 1951-53 0. Missions and Functions of CIA Offices, 1950-53 H. List of . Reports, 1952-53 K. Descriptive List of 01Z Estimates Projects, 1950-53 L. List of OSI Projects, 1949-53 M. List of IAC Projects, 1950-53 A. Index Approved For Release 2002/1S RE-yDP64-00654A000200130001.6 Approved For* ease 2002/10/09 : CIA-RDP64-00650200130001-6 '"IA RATIO AL LSTOz y of TRAL INT .LLMENC l95O-19'3 Cdr I: ROUND, w>-x.9547 T:;morissr Relatin ; to CIG Page 1 Sowers' Ideas of Organizatit , 3,946 14 Modification Required by NIA.-2 8 The Personnel problem, 1916 9 Vandenberss Decisions and Actions, 39h6-19147 11 Coordination of Activities Under Va g, 1946.19147 1? Expz n:ion of au, 19146-19147 19 Organisational, Changes in CIa, 19146.-19147 23 C bar a of Cow end the Natioraal. Security Act, 19147 25 NSC Interpretation of the Laws 1947.1948 27 Effects of the Interpretation, 3,9148 31 Development of the NiUenkoettW Organization, 19147-19l 9 314 Coordination Prrobles, 19147-19c0 35 The CIRS Problem, 19148-1919 39 The IhUlee Co 3ittes Reconmsndattons and Their Reception by the Agency, 19149-1950 The 19!49 Agency "Reorganization" 44 The 19501953 Reorganization in Relation to the 19146-1950 Background 149 Approved For Release 2002/1RE DP64-00654A000200130001-6 Approved Forrlease 2002/10/09 : CIA-RDP64-0065_00200130001-6 C apter I cKn min. 191,6-195() The purpose of this stisiy I I the organizational developr*' tions, of the ::.'antral Intelligence s within certain lirtit..a- central Intelligence as a chronological guide the period covered by the administration of General ;alter 'edell .smith (October 7,i950-Februa - 16, 1953). In order to make clear what Oenerel, ith eras able to accoeh, it is desirable to trace very briefly the %ain events in to dee,sloptnent of Centr*1 intelli- gence over the four years that preceded his term in office. Theories Relating to CIG is ney 3. ' ouers, first firector of "entral Intelliainnce (Jan?arv 22, I9b6 - June 10, 191,6) had an afty was ;shared by nef Lher of the two on who iwmediately sex:eeeded hi ience, there took place all through 1946 and 1 Ale first issue of the L.*i 5uaa'Y was ly published is'eb. 15, 1946. peer VII, below. Approved For Release 2002/1 0/ EGRE P64-00654A000200130001-6 Approved For?ease 2002/10/09 : CIA-RDP64-006540200130001-6 into 1947 a ueter wined but not very successful effort on the part of the ieports :.ta f to acquire the people it neadeed.1 In his final report on June 10, 19!46, on his c.eparture from 1I e! dmi ral 5ouers singled out _ the personnel problem as a vital one ca lling for solution. He pointed out in general, however, that during the four months just passed a good deal of progress had been do toward laying the groundwork for Cientral Intelligence.2 Hoyt S. Vandenberg, his successor, an organization consisting principally of the two Staffs Just described, plus the nucleus of organisations concerned with the dissemination function accorded to CIG,, its security, and such internal administrative problems as might arise. The letter, however, under the ':coup concept in force, would be largely matter of inter-agency liaison, 3 5cuere left it, GIG was still a body wit yin the intelligence structure. It could easily become an entity apart from the -:coup if the ituthority were to decide that the problem atwar in tel'ence could beet be solved by that means, or It could develop as a coordinating mechanism for the total struc- ture of which it was a part. 1 See it", interview with L. L. Montague, )pril 1, 1952, in 3/DdI/,'S files. 2 erlgeet of t:~ t E'rogress 44port, June 7, 1946, in k /~ / fS files. 3 because CI;; must look to the LAB agencies for funds? personnel, and services. 25X1 Approved For Release 2002/' ORE4TDP64-00654A000200130001-6 Approved For.ease 2002/10/09 : CIA-RDP64-00650200130001-6 Vandenberg's eciaions & ,ad actions rr r, r r.......r~ Luring the eleven months (dune 1o, 1946 - may 1, 1947) when he held office as U rector of trai intelligence, General Ioyt S. Vandenberg made decisions 'nd obtained agraements that had the effect of radically altering both the theory and the structure of Central intelligence, The most in0orUnt of these decisions were made and carried through daring Vande erg's first three monthe in office. The principal and basic decision concerned the resporsibility Of the Director with respect to the "strategic and national policy Intelligence" estimates that wsauld be the product of "correlation and evaluation# of intelligence, relating to the national security. Although these estimates would constitute but one function Of the ventral Intelligence :romp, they were the function that, in a sense, comprehended the rest. Inaax ch as the estimates were to be produced by the iroups they would be the product of Group effort and thus of the community of intelligence agencies under the NIA. As such, they could be rendered in the nesae of the roup, the Oroup as a whole being answerable for them. Or they could be rendered in the name of the 1.:'irector of .:.;antral intelligence who alone would be answers ;le for then. 'rom the point of view of an official using the esti tee, the difference 4ipht not be great. 'rcaa the point of view of the producer, the difference sight be considerable because sole Approved For Release 2002/1& EC. DP64-00654A000200130001-6 Approved ForSease 2002/10/09 : CIA-RDP64-0065400200130001-6 responsibility for the thing :produced i*plied sole authorit;;~ over the means of production. According to `eneral Vsnadenberg, "Pational 1nt }lli. ,s~=nce s wic tea had to be the opinion of the R:ires:ctor. td a conceded the ri-:ht of his colleagues on the Intelligence Advisory #.{oard ` to enter contrary opinions if they chose, which he would feel duty bound to forward along with the of riciaal esstiaaates. But the esti- mate itself would be his, and he would atsan d responsible for it. The reason given by Vandenberg was that his appointment as ?i.rector of -entral intelligence constituted an order from the President of the United Litsates, which order entailed all the responsibility of ooraceand. 2 Fundamentally, it was Vandenberg's attitude toward the lrector's rcaponsaibility that dictated the three demands that successfully placed before the National Intelligence Authority between June 28 and >epteaber 5, 1946; for the right to collect foreign intelligence apart from the departmental collection services, for the right to conduct intelligence research, and for the financial independence necessary to maintain control over the persons engaged, 1 ?redecesavr of the Intelligence Advisory 'oaaittee. Authorised by 'Bra. 7 of ?restdant Truman's letter of Jan. 22, 1946 (see Annex At below) to consist of the ". . . heads . . . of the principal agencies of the government having functions related to the national security as determined by the National Intelligence Authority." 2 laragraph based on Vandenberg's own statesaents. See Historical Staff interview with Vandenberg, 'Harsh 17, 1952, in Off ;I f HS files. Approved For Release 2002/' EC.I* 2DP64-00654A000200130001-6 Approved Foreease 2002/10/09 : CIA-RDP64-00650200130001-6 in those and other activities, though all of the rc i apcrtant, It oral; the 1a f, iris: a ll b considers hsr** nci ie of :wing research ccnciioted by i.; was approved L7 the if th reutive of the fational nte11ig e t uthority, an duly it 19L6.2 The relevant ;Aaragra h stet d thats in performing tae functions spceif"ie=d in 'ara arh 3-a of the 'r'residentfs letter, the lrector of central intelligence is hereby authorised to undertake such reset;rch and analysis as may be necessary to deter-mine what functions in the fields of national security izuteelligence are not being presently performed or are not Lein adequately per- formed. Based upon these determinations, the 'ixectccr of ;`.entral intelligence may centralize such research and analysis activities as nay, in his opinion and tictt of the appropriate member or members of the sntelli ,ence advisory Board, be l'lore O ficiently or effectively a :omplished centrally." 3 Literally read, this paragraph is little more than a state- ment of the obvious; perhaps even a redundant statement in vitw of 1 Sea footnote, page 1, above. See annex C', below. The officers approving FHA-5 were; cheson, ;patina; secretary of Statai -bert f:. Patterson, Secretary of war; John L. Sullivan, Acting secretary of the Navy; and gilliam 1. Leahy, Special .epresontative of the President. 3 :See Annex ~', below, paragraph 2. 13 Approved For Release 2002/ ?C 1 2DP64-00654A000200130001-6 Approved For 49 ease 2002/10/09: CIA-RDP64-006500200130001-6 the already-eiaateu unetiun of entry tiL it calsz.~ to "coordinate inteelli Mce activities," end to r)erforra "services of cocoon concern." 'ztrifeesst" y, ar curve of research activities would be "cuoramation," wni e cetit 'a: i.zatioA of goo* of then i Of Co'OV101a CQa:V r }. t' . o,i iolA en :cy nerai vaudenbsrg in "uy otnse to the iiirectivta, awc:-v ey , TL proceeded at ornce, j L to aaatabii and its lituraai terns? for he l -scale research activity wit4in C!,; by expansion of the 4ntraai. eports :taf . This action was in line with--if not necessary to-- -nersl, 'a n enberg t s concept of the 4rector's reoponaibility. The flaw in the arrangement was its incompleteness. In the nature of things, it would be a long time before the means either of collection or of interpretation could reach sufficient maturity to constitute a firaa basis for the exercise of individual responsibility by the Director of ventral Intelligence. In the particular nature of the particular case, no central system of intelligence collection or interpretation would be likely to become self-su"icient short of a centralization that would have 1 :3istoricaal examination of pertinent docu=nants has disclosed no evidence to :t Y3eneraal Vandenberg complied with the literal terms of NIA-5 in this regard. Approved For Release 2002/SE 1RDP64-00654A000200130001-6 Approved For?ease 2002/10/09: CIA-RDP64-0065000200130001-6 the effect of abolia:ith or incorpcrating All cthez agencies, in the absence of such aA ufl cly and ra, ical develop. :went, the central research crgsJ,satlcn could only emerge on a par with ` ency research organise tons e; their activities. 'Vandenberg 's interpretl ;on of UTA-5 wee also certain to have an effect on "coordinaation" of eat ttee,~ In Venden"Cerlieating "the intelligence activities and research of the various epartraents and, A'~ea a:iea." (By 191x8, however, the -.1rector's office of rase.}rch was so obviously duplicating !nuoh of the work done in other a _;encies that It i i ht easily have been disestablished in accordance with a literal interpretation of this part of the :irective. The Director did nothing, however, to inhibit its growth and it continued to develop aloe; the lines that had been laid out for 1 The other was first issued -Dec. 12, 19147. had to do with collection and is therefore not ger*ane to this study. 1 28 it.) SECR Approved For Release 2002/10/09 : CIA- DP64-00654A000200130001-6 Approved For,Iease 2002/10/09: CIA-RDP64-00650200130001-6 3. The =D'irector's right' of dissemination of national intel? ligenos was curtailed to the gwt that the z ; -'rust -i.rst offi- cially concur in it or offer an-+lagreeed substantial dissent." t. It was emphasized that there should be a free inter- change of information as between the Agmey and the intelligence organizations controlled by the IAC, No means of assuring this interchan ;e, however, were provided. The iirectorrs right to hire his own people in addition to those supplied him by the IAC asuber agencies was confirmed. was specified, how^ver, that etnplayaes furnished by the Agencies should rain under their effective control. b. Terms were, defined and fields of special interest delineated. "The whole field of intelligence production" was divided into five parts, ranging from "basic intelligence, " to "national intelligence", and was allocated as follows: "Basic intelligence" was assigned to Central Intelligence as general coordinator, editor, and fisher; the work of producing basic intelligences, how- ever, being done by the other agencies. b. "Current Intelligence" was not specifically assigned, it being directed that Central Intelligence and "each other agency" should produce its own. It was not specified that current intelligence produced by CIA I 29 Approved For Release 2002/1 9.-DP64-00654A000200130001-6 Approved Forpease 2002/10/09: CIA-RDP64-00650200130001-6 should be '?naet,i_onel" or of any other special tt pe; hence, current intelligence co-ald be ses dereed exera,~)t being submitted for concurr .nae baftre disseminution, co "Staff" .and "departseental" inta4"~I'tj defined as to be, to all intents aancs ,arpoa s, the samf e things namely what was required by an indl is as l rdinating intelligence activities should be discharged by the TIrector, aided b,,; his own staff, work- ing with the Intel l.igence Advisory Committee. National intelligence estimates should be directly coordinated by the IAC Itself. Better preparation of these documents would require revision of the Office of Reports and 'stimaates, l to the extent of having it form one small group to be solely concerned with the preparation of national esti- mates on a strictly cooperative basis; and anoth*ir with research "of common concern" which would supplement, but in no case duplicate, the work of the established agencies.2 Finally, a series of administra- tive changes would be inaugurated, designed for greater efficiency in the Agency's discharge of its statutory responsibilities. These proposals, although they were not greeted with univer- sal disapproval, did not find an entirely cordial reception within the "entrsl Intelligence Agency of 1949. If nothing else, they e holies Report, p. 81. 2 This proposal was actually, of course, more in accordance with the agreement that originally established ORF (NIA-5; see Annex C. below) than what had developed as a result of the Vandenberg admi.nistratin 's interpretation of the agreement. Fee discussion Pp. 1t-15, above. I h.2 Approved For Release 2002/1 0 ff& RDP64-00654A000200130001-6 Approved For 10 ase 2002/10/09: CIA-RDP64-006500200130001-6 seemed premature, for when ulles Report was submitted to the -66 National ecurity Council, Central Intelligence was almost exactly three years old. As an Agency, it Was seventeen months old. In the course of three years, in spit, of changes and controversies, a great deal had been accomplished, a fact which the ''omniittee did not necessarily deny, holding rather that the new system was being mismana'ed. The defenders of. the system,towever, could point to progresa In promoting the objectives of unified intelligence effort and production of sound national intelligence. :simultaneously, they could emphasize the point that the systse had had a very short time to develop and that to make radical ogea in the midst of this formative period would be to risk hard-won gains.l In simplified essence, however, the disagreement of the 19149-50 administration with what the Dulles Committee proposed, was centered in the concept of divided responsibility. Although, as has been noted, Admiral t ilienicoetter had never echoed General Vandenberg's demand for authority commensurate with the Director's mandate from the President, he had also never declared unoauivooally for group (IAC) responsibility and authority. .sing Uillenkoetter's two years in office, however, the Agency had inclined toward the theory that it must be independent in order that it could present the NSC with estimates uncolored by ?)epartmental prejudice. In theory, at tee P'~'is Comrents on '?idles .eport, dated Feb. 2% 1919, in O/DCI/Hh,- files. 43 S C 7Z ~* 'r Approved For Release 2002/10/09 : CIA-PDP64-00654A000200130001-6 Approved ForOlease 2002/10/09: CIA-RDP64-00650200130001-6 .oast, the sort -f srO' '-;r'8*e responsibility favoree h- ' e ' ~or~rritteer ' k3 Inir!i:?al to this point of view. "'eff"deg?s Of a'he 19;9 'tatus rluss $ `ertral In elliCence found coer:frrt In the two c ept?~Ta~ taken to the "uPee "e !gig exnresrod in the sport known n s ?p, .^_~~") a 1 one thxt th? Di.ract or s' _.ouir riot he ` ound by the concept c,f collective r espon- sibilit,1; the ether, the;, rcorg^rat.7ation undtertr:ken in .c.ordince with the Dulles "z?-ort need not iieces;sertly follow the exact mans ,,roposed br the , nr:.e iIttee. T! ,,e Inni'ied r ijor.tion of collective rr:s oasibility by the 'fiAtlon'l ``.-,curity Council, Li particular, seu. rsd to giva substance to L ,e reaction that hvd i ca:?e greeted the '-'u11e Report within the '^ritral lntailih--ene3 Agency. This reaction was pri- nAri1y that of the persona viio hind dealt at first hand oer e period Of ro1t 3 or years ; 1 th the practical pr .leis ent^iled in getting up and operating the i ency. Whereas the Committee thought of 'entrai I '-el igence primarily as a mans through which all governmental intelligence could be brought to bear, in a coord neted form, on notional problems, many key CIA officials of the time thought of the ",entral tn:elUgenca Agency a the principal instru- nt, under the National Security Council, for the production of 1 :ometi s known as the "t4cNarney deport" adopted by the Nm on July 7, 1949, accepting the )idles Report with few reservations. 1 44 FRET Approved For Release 2002/10/09 CIA-RDP64-00654A000200130001-6 t113 recsor., Approved For ease 2002/10/09: CIA-RDP64-00650200130001-6 notional intelligence. `'hey believed that the other r enciess owed CIA all necessary "cooper Ycn" toward this rteiI Lgence rued rctivcs of the' hat Tonal uecurity ouncil had been framed with this end i,n view, but that too many loopholes left J-1i the t i.recti' ,, and that the Agencies had r epponsibiiiti.s under themo l' etel - 4 1'vaco Aecepting the pr lees on which this typ* of reason ing was Lased, howevc , the word -cooperation" sight hr,ve been considered ill choson. f;nother word would have been "compliance." In order' for Central intelligence to aea-ot compliance, it would have to be given sriuch Yreatcr powers than it possessed. A move in the direction 1 Thus, in a memorandum to the 4rector of ventral intelligence on the subject of "I*C }:ooperation with CIA", dated ept. 30, 19L9, the Assist:;nt :irector for ~'eports are,. rIstix tees wrote: ""'Ile :,Host spectacular evidence of the lack of depart mental cooperation with C11 is represented by ' SCII='rs. ?yes are cited as such evidence on the ;;rounds that: no as a result of the coordination of these direc- tives with the 1AG agencies prior to C action they represent only those concessions to CIA that the VC aencies were willing to cake, and consequently, do not provide the ..rector of a antral Intelligence with the authority required by him to discharge the reaponssi- tiliti,es imposed upon Us. b. by I:?.C insistence they contain all canner of escape Clausen which vitiate_epart:nental responsi- bilities to CIA, and thereby hasher the objectives of the National Security Act of 19117 toward a fully coor- dinated US intellt_?ence effort." see tab 1* to ;'e*o .3) in 0/ICI / files. I lt5,. RET Approved For Release 2002/10/09 : CIA-RDP64-00654A000200130001-6 Approved Foreease 2002/10/09: CIA-RDP64-00650200130001-6 of obtaining such powers in 1949 would have been a bold one. It would have amounted to a flat rejection of the banes 'r`eport and a direct challenge to all critics of Central Intelligence. Yet some move on this order had become almost the only logical conclusion from the position being taken by the Agency in 19139 and 1950. `1 he : irector favored a "strong central agency,", ilia Assistant Lirector for 11eports and gstimates was against any system which presupposed collective responsibility, The Lrector's feral Counsel interpreted the intent of Congress as favoring a fully respon- sible frectorate. The Chief of the Interdepartmental Coordinating and Planning Staff (or Coordinating, Operating, and Planning Staff) inclined toward the same general positions let no direct representations to this effect were made to the National Security Council by the Hille akoetter administration. For most of a year, from the fall of 1949 to the fall of 1950, the questions raised by the bullet deport were debated, primarily between the .i.rector and a group within the ~tate Lepartment which had proposed its own plan for 4ntral Intelligence under collective responsibility. The Agency's proposed reply to this proposal was in the nature of a counterplan which went some distance in the direction of centralized responsibility. Neither proposal, however, reached the point of gaining official approval.2 1 For correspondence underlying these statements, see folder "NSClia-1" in files of CIA General Counsel. 2 Ibid. Cet also Chapter II9 below. I 46 Approved For Release 2002/=WJRDP64-00654A000200130001-6 Approved For`ease 2002/10/09 : CIA-RDP64-00650200130001-6 The 1949 tgsM " arganisatio Meanwhile, Admiral fil,lenkoettor reported to the Security Council on October 7, 191&9, that (in accordance with the Co unc it e s partial endorsement of the Dulles Report) certain reorganisations were taking pl