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Approved For Release 2004/03/26 CIA-RDP64B00346R000100300061-5 SPECIAL ISSUE JUNE 24, 1961 .. 25c THE by Fred J. Cook Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 LETTERS One Small Act for Peace Dear Sirs: In a letter in the June 10 issue, re Mary Grooms's article on shel- ters [May 13], Robert Berkowitz com- ments: "I am not certain if she re- gards the United States as the only warlike agent in the world."' Perhaps Mr. Berkowitz will find it less incon- ceivable that anyone could so regard us (or rather, our government) after he has read Mr. Dreher's eye-opening article, "Hazards of Civil Defense," in the same issue in which his letter ap- peared. But in any case, may I suggest to him that all that really matters is whether the United States is one of the warlike agents in the world. I think the record clearly shows it is, and that as such it is one of the parties responsible for imperiling the very existence of the human race. I also think that if just one of the main warlike agents in to- day's world were to begin acting in such a way as to further-and not mere- ly praise-peace, the threat which nu- clear weapons pose to mankind would be lessened far out of proportion to the initial act for peace, because that aet would finally reverse the horrible trend of the arms race. BLOSSOM D. SECALOFF New Haven, Conn. Familiar Argument? Dear Sirs: William Gilman, reviewing The Strnct'ure of Science in Your June 10 issue, asks: ". . . Can we then ab- solve the Los Alamos scientists of their share of responsibility for Hiroshima?" The answer is Yes, because (a) we were at war; (b) without Hiroshima, the war would have continued for two more years and 2 million more Americans would have died; (c) far more Japanese lives, as well as property, would have been wiped out with a continuation of the war; (d) a leading Japanese states- man said if conditions had been reversed, he would have had no hesitancy in using the bomb against America. Chicago, Ill. ROBERT ROSGNBLUTHI Regressive Tax? Dear Sirs: In your May 13 issue, Peter Dorncr presented the case for a tax on the advertising of large companies. Mr. Dorner assumes that (1) as wealth grows, the demand for an increasing number of consumer goods "reaches a state of extreme" inelasticity" and (2) firms, by product differentiation and large advertising expenditures, can pass Summer Schedule After July 1, and through August., The Nation will ap? pear on alternate weeks only, i.e., on July 15 and 29, and August 12 and -26. The normal weekly sched- ule will be resumed, with the Sept. 2 issue. along cost increases to the consumer. When demand is in "a state of ex- treme inelasticity," the firm is in a po- sition to pass increases in cost along to the consumer with the result that prices are higher and the quantity sold is about the same. To the firm, a tax on advertising is an increase in the cost of doing busi- ness. If the tax can be forced on the consumer in the form of higher prices, then its economic impact is identical to that of a sales tax. A sales tax is a regressive tax. If one grants Mr. Dorncr his as- sumptions, one is confronted with a tax on advertising that is paid by the. consumer under a system of regressive taxation. Suppose that the volume of advertising does decrease. What will disappear? Will there be less Play of the Week or will there' be less Gun- smoke? Most of the effects that Mr. Dorner is seeking could, perhaps, he better achieved through a system of grading and labeling of advertised products and by a closer look at advertising material by the FTC. This would not raise the funds needed for public welfare projects: If these funds are to be raised through taxation, however, progressive taxation would seem to commend itself. Evanston, Ill. MORTON SCIINABEL Front the Bosporus Dear Sirs: Not for pedantry, but be- cause I like The Nation, I should like to point out two inaccuracies in your editorials of April 22: 1. On page 334: ". . . One of these is Franz Joseph Strauss, his Minister of Defense, who .insists that the NATO armies, which are mostly German ar- mrvies ..." 'Taint so. On. this side of the ocean, Turkey has the, largest military under NATO. 2. On page 335: "... It should not be forgotten that Syngman Rhec and Adnan Menderes, shortly before they were ousted from office by their irate countrymen, had also scored `smashing' electoral victories...." One of the rea- sons Adnan Menderes was ousted' on May 27, 1960 (an unforgettable date for Turkey), was the discontent of the intellectuals and students over the delay by Menderes' Democrat Party in sched- uling elections. The last election in Tur- key took place back in 1957. Opposi- tion leader Ismet Inonu, just before the May 27 Revolution, all but promised civil war if elections weren't held by October 27 of this year, the constitu- tional limit of four years since the last elections. (It is pretty much agreed that in the 1957 elections, however, manipulation of the electoral results "well known to dictators" took place.) Istanbul FERDINAND DRYLE In This Issue THE CIA by FRED T. COOK 529 ? Editors' Introduction 529 ? Part I: Secret Hand of the CIA 534 ? II: Allen Dulles:. Beginnings 5,39 ? Ill: Dulles and the SS 543 ? IV: Dulles, Peace and the CIA 547 ? V: With Dulles in Iran 551 ? VI: Just a Little Rev- olution 556 ? VII: The Road to War 561 ? VIII: Fiasco in Cuba 569 ? IX: A Look at the Future Crossword Puzzle (opp. 572) by FRANK W. LEWIS George G. Kirstein, Publisher Carey xie-williains, Editor Victor II. Bornstein, Managing Editor Robert Hatch, Books and the Arts Harold Clurinan, Theatre Maurice Grosser, Art M. L. Itosenthal. Poetry Lester Trimble, Music Alexander Worth, European Correspondent - Mary Simon, Advertising Manager The Nation, June 24, 1961. Vol. 192, No. 25 The Nation, published weekly (except for onds- slon of four summer issues) by The Nation Company and copyright 1961 in the U.S.A. by the Nation Associates, Inc., 333 Sixth Avenue, Now York 14, N. Y. Second class postage paid at New York, N. Y. Tel.: CH 2-84:00. Subscription Price Domestic-One year $8, Two years $14, Three years $20. Additional postage per year: Foreign and Canadian $1. made without the old address as well as the new. Information to Libraries: The Nation is indexed in Readers Guide to Periodical Literature, Book Review Digest, Index to Labor Articles, Public Affairs, Information Service, Dramatic Index. . Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 INTRODUCTION: "The only time the people pay attention to us," Allen Dulles once said of the CIA, "is when we fall flat on our face" - or words to that effect. But as Mr. Dulles would be the first to concede, the reason for the default lies not with the. people, but with the CIA itself. The disastrous Bay of. Pigs episode is not the only fiasco that can be Laid at the door of the lavishly financed CIA. But in this latest fiasco .more of the facts came to light than in similar earlier episodes. Now, therefore,. seemed an excellent time, while the facts of the Cuban fiasco are mind, to take a look at an agency which is of vital concern to national security. and the well-being of the people, but about which the people know less than about any major agency of government. What interested us, as editors, were not the immediate causes of the particular fiasco; we do not propose to join the feverish post-mortem search. foi: scapegoats: Our concern was with the basic question: how did this extraordinary agency come into bang? what is known about its record? how does it. :fit into the American constitutional scheme of things? On the face of it, an inquiry into. an agency dedicated, as is the CIA, to secrecy in its planning, its operations, its p'crsoiiiicl and its budget, 'pres'ents a difficult journal- . But a considerable amount of material istic undertaking. has been published. about the agency and its operations, some of it clearly inspired by the CIA with the approval of its director. True, most of the naterial Js scattered and disparate, consisting of small items which, taken alone, have little meaning. But when put together by by Fred J. Cook an astute craftsman, they form a significant pattern. The easiest, part of our job was to find the craftsman. Fred J. Cook's special articles for The Nation - "The FBI," "The Shame of New York," and "Gambling, Inc.," have won -him important journalism prizes for the last three years. In giving him the assignment, we told Mr. Cook to stick to the public record; we did not want him to attempt to seek out undisclosed facts or to probe into possibly sensitive areas. His assignment was simply to summarize existing published material which, long since available to potential "enemies," was still not readily available to the American public. Mr. Cook has followed our instructions. There is not a. fact hereafter set forth which has not already been published.. Yet, put together, these facts add tip to a story that proved new to its, as we are certain it will .prove new to the reader. And enough 'of the known facts are -presented to warrant an informed judgment about the agency. For what Mr. Cook proves is what Sir Compton Mackenzie demonstrated for Nation readers in another connection (see `"The Spy Circus: Parasites.with.Cloaks and Daggers," December 5, 1959); namely, that intelligence of the cloak-and-dagger variety is a two-edged sword, and that the sharper edge ;is some- times held toward the throat of the wielder. And another lesson. that Mr. Cook drives home is this: clearly the CIA must be divested of its "action" or operational functions and restricted to the sole func- tion of gathering information for other agencies operat- ing under customary constitutional safeguards. - ED. PART i SECRET HAND of the CIA SHORTLY BEFORE 6 P.M. on De- cember 5, 1957, a faceless man drop- ped a letter into a mail box in New York City's Grand Central Station area. It was to the editor of The Na- tion. The opening sentence read: "As an American intelligence officer, I feel duty bound to state my. ap- prehensions as to the future of my country." What was the basis of these apprehensions? The threat of a ram- pant world communism? The menace of Soviet weaponry? The dangers of internal subversion? No. The writer, whose letter bore in almost every line intrinsic evidence of minute and in- timate knowledge, was concerned about just one crucial aspect of the times -- the mortal damage America was inflicting upon itself. This was a . damage, he found, that resulted directly from the careers and the power and the misconceptions of two men: the late John Foster Dulles, then Secretary of State, and his younger brother, Allen Welsh Dulles, then as now head of the vitally im- portant Central Intelligence Agency, the official eyes and ears of American foreign policy, the medium that gathers and sifts and judges infor- mation-and so conditions the minds and predetermines the decisions of American policy makers on the high- est levels. Now, four years later, in the wake of the Cuban disaster - and other less publicized but equally significant disasters the words of the intel- ligence agent who unburdened him- self in that letter read like the most infallible of prophecies. America was being pushed along the road to for- eign policy disasters, he wrote, by the closed minds of the Dulles broth- ers - by their refusal to face facts as facts and their insistence on tortur- ing facts into the framework of pre- determined policy. This is the way the intelligence of- ficer phrased it: The following circumstances are cause for deep concern: 1. United States foreign policy is not formulated on the basis of an objective analysis of facts, particu- larly those made available by In. Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 telligence Service, but is being de- termined by John Foster Dulles' personal rash conceptions. 2. The fact that Allen Dulles is in charge of collection and evalua- tion of all information makes it pos- sible for the Secretary of State to distort the information received as he sees fit. Facts thus presented disorientate not only the President and Congress but also the people of the United States. (Italics added.) 3. As a consequence,, our foreign, policy is not based on the real in- terests of the United States. It has suffered one defeat after another and may eventually draw us into a nuclear war. Though John Foster Dulles since has died, Allen Welsh Dulles still rules the CIA, and the Cuban de- bacle that his agency sponsored, planned and directed has provided graphic proof that he still retains his ability to "disorientate not only the President and Congress but also the people of the United States." Cuba: the Lost Lesson No issue of our times lies closer to the core of the decision of war or peace on which the very survival of mankind depends. For from our proper understanding of the facts, our recognition or denial of com- plicated and even at times trans- parent truths, must derive the for- mulation of our policies and the most fateful of our decisions. Cuba is only the most recent and most striking example. When the CIA spurred on the abortive invasion under the rose- ate delusion that Cubans were chaf- ing to revolt against the tyranny of Fidel Castro, the United States achieved only the disgrace and op- probrium of a British-style Suez on an even more futile scale. Not only did the invasion fail ignominiously, but the attempt helped, if anything, to solidify the iron rule of Castro. It enabled him to pose as the hero of his people, successfully repelling a "foreign" invasion. It touched off a ripple of reaction throughout Latin America where people, while they may not want a dictator like Castro, want no more the gratuitous med- dling in their internal affairs by the American giant to the north. It takes no seer to perceive that all the evil fruits of the Cuban blunder have not yet been reaped. Shockingly in this context come indications that the U.S. Govern- ment, instead of learning a most salutary lesson from the Cuban fiasco, has determined to turn its back even more resolutely upon facts and truth. In the last week of April, after officials on every level should have had time to digest the moral but that too much had been print- ed about the gathering of Cuban in- vasion forces-and that this had alerted Castro and ruined an other- wise promising endeavor. The head- on collision of this comforting theory with the most elemental facts about modern Cuba was ignoredwith great determination-with such great de- termination, indeed, that President Kennedy, in a speech to a conven- tion of American newspaper editors, suggested that the editors, before they printed a story, ask themselves not only "Is it news?" but "Is it in the interest of national security?" Such a censorship, even if only vol- untary, would inevitably result in increasing the blackout of informa- tion from which the American peo- ple have suffered since the end of World War II. As James Higgins wrote, "The truth of the story .. . was not to be considered an impor- tant' measure of its rights to see print. . . . I got the impression in Washington of a governmental closed mind." This is. a liability that could be fatal to all mankind in a world teeter- ing on the edge of thermonuclear disaster. What America so obviously needs is not fewer facts but more, not deceptive images that fit our prejudices and preconceptions, but truth-however unpalatable. What America needs is the unvarnished truth about Chiang Kai-shek, about Quemoy and Matsu, about Laos, about Latin America-and especial- ly about Cuba, the island (as the President so often has reminded us) that is just ninety miles from our shores, the island about which our secret and public minisformation has been demonstrated to be quite literally colossal. of Cuba, some 400 newspaper editors and columnists were called to Wash- ington for a background briefing on foreign policy by the State Depart- ment. As James Higgins, of the Gazette and Daily (York, Pa.), later wrote, "There developed at this con- ference a very evident tendency on ON TMi AIR \21-1 the part of the government to blame the press, at least part of the press, for spoiling the plans of the Central Intelligence Agency." The govern- ment theory plainly was, not that the whole conception was faulty, The Agency Nobody Knows In this all-pervasive atmosphere of the shut mind and the distorted fact, Central Intelligence is the key, the vital agency. Yet it is the one agency of government about which the American people are permitted to know almost nothing, the one agency over which their own elected representatives are permitted to have virtually no control. CIA is the only agency whose budget is never dis- closed, whose director can sign a S30 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 voucher for any amount without checkup or explanation. Flow many persons does it employ, bow many agents does it have? Even Congress- men do not . know precisely. Its Washington headquarters staff alone is estimated to consist of more than 10,000 employees; in total, it is be- lieved to have more persons on its payroll than the State Department. How much money does it have at its disposal? Again, even most of the Congressmen who vote the funds do not know precisely. CIA itself says this "figure is very tightly held and is known to not more than five or six Members in each House." CIA allotments are hiddcn,in the budget- ary requests of various 'government departments; estimates vary from a low of $500 million annually to the-$1 billion mentioned by the conserva- tive New York Times. A billion dol- lars- a year concentrated in the bands of one man about whose activities the American people are permitted to know ' virtually nothing- and about whose activities it appears to be' suggested they should know even less-represents the kind of power that, in essence, can well determine the nation's course and remove from its people the power of decision. Two Beaded Monster This danger that CIA, may not just inform,, but also determine pol- icy, has been enhanced from the agency's inception by an authorized split personality. From the start, CIA has been a two-headed monster. It is not just a cloak-and-dagger agency entrusted with the important task of gathering information concerning our potential enemies throughout the world; it also has the authority to act on its own information, carry- ing out in deeds the policies its in- telligence discoveries help to form. Though its overt acts are supposed to be under the direction of the Na- tional Security Council, the risk in- herent in such a dual responsibility is obvious. With an end in view, can intelligence be impartial? The hazards implicit in such a vast, concentrated, double-motive agency were not unforeseen. Harry Howe Ransom, of Harvard, in his Central Intelligence and National Security; describes the reaction of Adin1fal Eh es't J. King in March, 1945, when the Secretary of the Navy sought his views on the formation of the proposed centralized intelligence agency. "King replied," Ransom writes, "that while such an arrange- ment was perhaps logical, it had in- herent dangers. He feared that a cen- tralized intelligence agency might acquire power beyond anything in- tended, and questioned whether such an agency might not threaten our form of government." British intelligence, for centuries considered one of the world's most expert, has long held that the wed- ding of action to intelligence is a fatal flaw in CIA. So have others. In 1948, Professor Sherman Kent, of Yale, himself an intelligence officer in World War- II, wrote a treatise on the purposes and the dangers of in- telligence operations in a book called Strategic Intelligence for American World Policy. At the time CIA had just been formed and its perform- ance lay entirely in the future, but Professor Kent struck out vigorously at what he called "the disadvantage of getting intelligence too close to policy." He added: This does not, necessarily mean officially accepted high United States policy, but something far less exalted. What I am talking of is often ex- pressed by the words "slant," "line," "position," and "view." Almost any man or group of men confronted with the duty of getting something planned or getting something done will sooner or later hit upon what they consider a single most desirable course of action.. Usually it is sooner; sometimes, under duress, it is a snap judgment off the top of the head.... I cannot escape the belief that tinder the circumstances outlined, intelligence will find itself right in the middle of policy, and that upon occasions it will be the unabashed apologist for a given policy rather than its impartial and objective an- alyst. It takes no particular insight to find the seeds of the Cuban fantasy in that perceptive paragraph. In the aftermath of so monumental a blunder as Cuba, however, it seems pertinent to inquire: Just what is the record of CIA? Are its successes overbalanced by its failures? And does it, in its dual role of secret agent and activist operative, not merely inform our foreign policy' but, to a large measure at least, determine it? Let it be said at once that there can be no exact score board chalking up the runs, hits and errors of CIA. Allen Dulles himself has commented that the only time his agency makes the headlines is when it. falls flat on its face in public. Its successes, he intimates, cannot be publicized for the obvious reason that to do so might give away some of the secrets of his far-flung intelligence network. This is true, but only partially so. For CIA, while it refrains from pub- lic announcements, does not disdain the discreet and controlled leak. And sonic of these leaks have found their way .into such prominence as Saturday. Evening Post exclusives. Where the CIA Succeeds Despite the secrecy of CIA, there- fore, there is on the public record, in the fourteen years since its cre- ation in 1947, a partial and, indeed, highly significant record of its deeds. And by this record it is possible to judge it. Let's look first at some of the achievements. ?IIn 1955, a CIA communications expert, studying a detailed map of Berlin, discovered that at one point the main Russian telephone lines ran only 300 yards from a radar station in the American sector. The CIA dug an underground tunnel, tapped the cables and, for months, before the Russians . got wise, monitored every telephonic whisper in the So- viet East Sector. JIn 1956, when Nikita Khrushchev delivered his famous secret speech denouncing the crimes of Josef Stalin before the Twentieth Communist Party Congress, a CIA agent man- aged to get the text and smuggle it out to the Western world. Washing- ton was able to reveal the explosive contents before the Soviets them- selves had edited the speech for pub- lie consumption. The blow was prob- ably one of the strongest ever struck at Communist ideology. Communist parties in the United States and other Western countries, long taught by Communist propaganda to regard Stalin with reverence, felt that the bedrock of belief had been cut' out from under them. The U-2 spy plane operation, a J`une 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 531 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 risky procedure that backfired dis- astrously in the end, was for years one of the world's most successful feats in espionage. From fifteen miles up, this plane took pictures of such incredible clarity and detail that it was possible to distinguish between a cyclist and a pedestrian; its radio receivers, which monitored all wave lengths, recorded literally millions of words. A single flight across Russia often furnished enough assorted in-- formation to keep several thousand CIA employees working for weeks, and the flights lasted for four years before, at the beginning of May, 1960, on the very eve of the sched- uled Summit Conference in Paris, pilot Francis Powers took off on the mission on which he was shot down. The,bad judgment implicit in order.. ing the flight at such a delicate time, the ridiculous CIA "cover story" that Powers was gathering weather data, the solemn promulgation of this fairy tale and the swift subse-. quent exposure of the United States before the world as an arrant liar-- all of this wrecked the Summit, forced the United States to abandon the U-2 aerial espionage program, and inflicted enormous world-wide damage on American prestige. Whether, in the ideological war for men's minds, the ultimate tarnishing of the American image outweighs the positive details garnered by the U-2s in four years of successful espionage remains a forever unresolved point of debate. For one thing, the ideo- logical war goes on, neither finally won nor irretrievably lost; for an- other, no one except on the very highest and most closely guarded levels of government can possibly know just how vitally important were the details the U-2s gathered. Though the U-2 program became, in its catastrophic finale, a fulcrum of policy, the significant pattern that emerges from the Berlin wire tapping, the smuggling of the Khru-- shchev speech, the years-long earlier successes of U-2, seems fairly ob-? vious. All dealt with intelligence- and intelligence only. The intent was to gather the kind of broad and de- tailed information on which an in.. telligent foreign policy may be based. These activities did not in them- selves constitute active meddling in, or formation of, policy. Unfortunate- ly, not all CIA activities fall into this legitimate intelligence role; time and again, CIA has meddled active- ly in the internal affairs of foreign governments. And it is in this field that some of its most vaunted suc- cesses raise grave questions about the drift and intent of our foreign policy. Where It Fails Here are some of the high spots of CIA in international intrigue: ?In. 1953, with Allen Dulles him- self playing a leading role, CIA sparked a coup that ousted Moham- med Mossadegh as Premier of Iran. Mossadegh, a wealthy landowner, rose to political power by capitaliz- ing on popular hatred of the British Anglo-Iranian Oil Company, which dominated the economy of the na- tion, exporting Iran's greatest na- tional resource by payment to the national treasury of what Mossa- degh considered a mere pittance. Mossadegh set out to nationalize the oil industry in Iran's interest, allied himself with pro-Communist forces in Teheran, and virtually usurped the power of Shah Mohammed Reza Pahlevi. When he did, a successful CIA plot bounced Mossadegh out of office so fast he hardly knew what had hit him; the Shah was restored to power; and a four-nation con- sortium, in partnership with the Iranian Government, was given con- trol over the country's liquid gold. CIA showed a tendency, if not to brag, at least to chuckle in public about this wily and triumphant coup; but the aftermath has furnish- ed no cause for unalloyed rejoicing. The United States poured millions of dollars into Iran to shore up the government of the anti-Communist Shah. A Congressional committee found in 1957 that, in five years, Iran had received a quarter of a billion dollars in American aid. Yet the Iranian people themselves had not profited. So many Anerican dollars had stuck to the fingers of corrupt officials that Iran was running up constant deficits, though the Con- gressional committee found that it should have been fully capable, with its oil revenues, of financing its own national development. Despite the hundreds of millions of dollars in American aid, Iran remained so prim- itive that, in some isolated towns, in this twentieth century, residents had yet to see their first wheeled vehicle; a whole family might live for a year on the produce of a single walnut tree; and small children labored all day at the looms of rug factories for 20 cents or less. Small wonder, as Time reported in 1960, that Mossa- degh "is still widely revered"; small wonder either that a new Premier, appointed by the Shah in early May, 1961, after a riotous outbreak in Teheran, was described by the Asso- ciated Press as the Shah's "last hope of averting bankruptcy and possible revolution...." ?In 1954, Jacobo Arbenz Guzman won an election in Guatemala and achieved supreme power. This demo- cratic verdict by the Guatemalan electorate was not pleasing to the United States. American officials de- scribed the Arbenz regime as com- munistic. This has been disputed, but there is no question that Arbenz was sufficiently leftist in orientation to threaten the huge land holdings of Guatemala's wealthy classes and the imperial interests of United Fruit and other large American corpora- tions. American disenchantment with Arbenz needed only a spark to be exploded into action, and the spark was supplied by Allen Dulles and CIA. Secret agents abroad spotted a Polish freighter being loaded with Czech arms and ammunition; CIA operatives around the world traced the peregrinations of the freighter as, after several mysterious changes of destination, she finally came to port and began unloading the munitions destined for Arbenz. Then CIA, with the approval of the National Security Council, struck. Two Globemasters, loaded with arms and ammunition, were flown to Honduras and Nica- ragua.. There the weapons were placed in the hands of followers of an exiled Guatemalan Army officer, Col. Carlos Castillo Armas. He in- vaded Guatemala, and the Arbenz regime collapsed like a pack of cards. It is perhaps significant that the Guatemalan blueprint was practical- ly identical with the one CIA follow- ed this April in the attempt to over- throw Castro. Only Castro was no 532 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Arbenz. In any event, Guatemala, like Iran, remains one of the CIA's most publicly acknowledged coups; and, like Iran, the sequel raises dis- turbing doubts about precisely what was gained. For the promises of the CIA-backed Castillo forces to insti- tute social and democratic reforms have not yet materialized. Half of the arable land in the nation of four million persons still remains in the hands of 1,100 families. The economy of the country is dominated by three large American corporations, topped by United Fruit. Workers in the vineyards of United Fruit staged a strike in 1955 trying to get their wages of $1.80 a day raised to $3. They lost. And Guatemala is still a distressed country-so deeply dis- tressed that the Kennedy Adminis- tration feels it must have several more bushels of American aid. ?Tn 1.954 and again in 1958, the United States almost went to war with Communist China over the rocky islets of Quemoy and Matsu, squatting less than three miles off the Chinese coast. When Red C'hi- nese artillery barrages blanketed the islands, heavily over-populated with Chiang Kai-shek troops, American public opinion was conditioned to react angrily to these aggressive ac- tions. What hardly any Americans realized at the time was that the Red Chinese had been subjected to considerable provocation. Allen Dul- les' CIA had established on Formosa an outfit known as Western Enter- prises, Inc. This was nothing more than a blind for CIA; and, as Stewart Alsop later wrote in the Saturday Evening Post, CIA agents, operating from this cover, masterminded "coin- mando-type guerrilla raids on the mainland ... in battalion strength." The title to Alsop's article told all: "The Story Behind Quemoy: How We Drifted Close to War." ?In 1960 and again in 1961, the landlocked Indo-China principality of Laos threatened. the peace of the world in a tug-of-war between East and West. Again the American pub- lic was confronted with glaring head- lines picturing the menace of an on- sweeping world communism; it was given, at the outset at any rate- and first impressions in international sensations are almost always the ones that count-practically no under- standing of underlying issues. Yet a Congressional committee in June, 1959, had filed a scathing report on one of the most disgraceful of Amer- ican foreign aid operations. The com- mittee found that, in seven years, we had poured more: than $300 mil- lion into Laos. This indiscriminate aid had caused runaway inflation and wrecked the economy of the country. At our insistence, a 25,000- man Army that the Laotians didn't want or need-and one that wouldn't fight-had been foisted on the Lao- tian people. In a completely botched- up program, American resident gen- iuses spent some $1.6 million to build a highway, built no highway, and wound up giving all Southeast Asia a vivid demonstration of the most unlovely aspects of the American system of bribery, graft and corrup- tion. As if this wasn't bad enough, little Laos fairly crawled with CIA agents. These gentry, in late 1960, in another of their famous coups, overthrew the neutralist government of Prince Souvanna Phouma and in- stalled a militarist regime headed-by Gen. Phoumi Nosavan. The Phoumi Army clique had just one qualifica- tion to recommend it, but it was a qualification dear to the heart of CIA: it was -militantly anti-Commu- nist. Unfortunately, this attitude did not recommend the new regime as heartily to the Laotian people as it did to the CIA; General Phoumi had almost no popular support, and when the Communist Pathet Lao forces began to gobble up vast chunks of the nation, there was hardly any re- sistance. The result was inevitable. The United States was placed in the humiliating position of practically begging to get the very type of neu- tralist government its CIA had con- spired to overthrow. A greater loss of face in face-conscious Asia could hardly be imagined. Revolutions for Hire? These are just a few of the best- documented examples of CIA's med- dling in the internal affairs of other nations. There are 'others. There is the case of Burma, on whom CIA foisted unwanted thousands of Chiang Kai-shek's so-called freedom fighters-warriors who found it much pleasanter to take over practically an entire Burmese province and grow opium than to fight the Red Chinese. There was this spring's Algerian Army revolt against Gen. Charles de Gaulle, an event in which an accus- ing French press contends the CIA played an encouraging hand. CIA categorically denies it, but French officialdom, suspicious as a result of previous CIA meddling in French nuclear-arms program legislation, has refrained from giving the American agency a full coat of whitewash, June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 -533 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Such activities obviously range far beyond the bounds of legitimate intelligence gathering. No one will argue today, in the tensions of a cold war that at almost any moment might turn hot, against the need for an expert intelligence-gathering agency. But does it follow that we need and must have an agency gear- ed to the overthrow of governments in any and all sections of the world? Have we, who pose (most of us sin- cerely) as a truly democratic peo- ple, the right to send our secret agents to determine for the people of Iran or Guatemala or Laos what government shall rule them? We have never proclaimed this right; our public officials doubtless would express pious abhorrence at the thought. But, in the light of past events, we can hardly be surprised if, to the world at large, CIA actions speak louder than official protesta- tions. Nor can we escape the odium of regimes with which the CIA has sad- dled us. It follows as inevitably as day the night that, if CIA conspires to overthrow a foreign government on the blind theory that in the war against communism anything goes, the American people as a whole are burdened with responsibility for the regime that CIA has helped to in- stall. And the record of such regimes in many remote corners of the world is decidedly not pretty. In the light of the past, it should be obvious that the future is not to be won by prop- ping up puppets with sticky fingers. On this whole issue, perhaps the most perceptive piece of writing was produced in the aftermath of Cuba by Walter Lippmann in a column en- titled "To Ourselves Be True." Lipp- mann, fresh from recent interviews with Khrushchev, wrote: "We have been forced to ask our- selves recently how a free and open society can compete with a totali- tarian state. This is a crucial ques- tion. Can our Western society sur- vive and flourish if it remains true to its own faith and principles? Or must it abandon them in order to fight fire with fire?" Lippmann's an- swer to this last question was a ring- ing, "No." The Cuban adventure had failed, he wrote, because for us it was completely out of character- as out of character as for a cow to try to fly or a fish to walk. The United States, of course, must em- ploy secret agents for its own infor- mation. "But the United States can- not successfully conduct large secret conspiracies," he wrote. ". . . The American conscience is a reality. It will make hesitant and ineffectual, even if it does not prevent, an un- American policy. . . . It follows that in the great struggle with commu- nism, we must find our strength by developing and applying our own principles, not in abandoning them. Probing more deeply, Lippmann analyzed Khrushchev's philosophy and explained the Soviet leader's ab- solute belief in the ultimate triumph of communism. The Soviet Premier, he had found, is sincerely convinced that capitalism is rigid, static; that it cannot change, it cannot meet the needs of the people, the needs of the future. Only communism can, and communism will succeed capitalism as capitalism supplanted feudalism. This, with Khrushchev, is "absolute dogma." Having explained this, Lippmann then wrote: I venture to argue , from this analysis that the reason we are on the defensive in so many places is that for some ten years we have been doing exactly what Mr. K. ex- pects us to do. We have used money and arms in a long, losing attempt to stabilize native governments which, in the name of anti-communism, are opposed to all important social change. This has been exactly what Mr. K.'s dogma calls for - that communism should be the only al- ternative to the status quo with its immemorial poverty and privilege. We cannot compete with commu- nism, Lippmann argued, if we con- tinue to place "the weak countries in a dilemma where they must stand still with us and our client rulers, or start moving with communism." We must offer them "a third option, which is economic development and social improvement without the to- talitarian discipline of communism." Obviously, the philosophy of Wal- ter Lippmann is several aeons re- moved from that of the CIA man, whose record shows he has just one gauge of merit-the rigid right-wing inflexibility of the anti-communistic puppet regimes that CIA has install- ed and supported. The record sug- gests that in the CIA lexicon there is no room for social and economic reform; such phrases imply a pos- sibly leftish tendency, and God for- bid that we should ever back such! Let's give 'em, instead, a military dictatorship. This CIA philosophy- in-action is the very antithesis of the American spirit Walter Lippmann was writing about, and to understand how we came to be encumbered with it, one must understand the career and ties and outlook of one man- Allen Welsh Dulles. PART ll ALLEN DULLES: BEGINNINGS WHEN ALLEN DULLES was eight years old, he wrote a thirty-one page essay on the Boer War, an event that was then disturbing the con- science of the world. The last sen- tence read: "I hope the Boers win this war because the Boers are in the right and the british in the wrong." Questioned in after life about that small "b" in "British," Dulles explained that he wrote it that way deliberately because he didn't like the British' at the time and hoped that small "b" would show just what he thought of them. Now, sixty years later, Allen Dul- les is very much the man foreshad- owed by the boy author. The interest in foreign affairs that led him to write a small book on the Boer War at the age of eight (it was actually published by a doting grandfather) has remained with him throughout his life. Some would say, too, that 534 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 'The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 he retained the strong prejudices, or the stout convictions (depending on how you look at it), that led him at the age of eight to dignify the British with ' a capital letter. The future master of the CIA was steeped in the aura of international affairs from earliest childhood. He was born on April 7, 1893, in Water- town, N.Y., where his father, Allen Macy Dulles, was a Presbyterian minister. His mother, the former Edith Foster, was the daughter of General John Watson Foster, who in 1892 had become Secretary of State in the Republican administra- tion of Benjamin Harrison. Years later his mother's brother-in-law, Robert Lansing, was to serve as Sec- retary of State in the administration of Woodrow Wilson. - These family ties were to be in- fluential both in the career of Allen Dulles and in that of his brother, John Foster, five years his senior. Allen graduated from Princeton with Phi Beta Kappa honors in 1914 and promptly went off to teach English for a year in a missionary school at Allahabad, India. Returning to Princeton, he got his Master of Arts degree, then followed in the foot- steps of his older brother by joining the diplomatic service ruled by his unle1c, . Secretary of State Robert Lansing. On May 16, 1916,_ when he was twenty-three, he went off to Vienna as an undersecretary in the American embassy. Though the young man himself could have had no inkling at the time, this was where it was all to begin; here were to be woven the first permanent strands into the career of the future boss of CIA. Beginnings in Vienna Vienna was then the capital of the Austro-Hungarian Empire, the part- ner of Kaiser Wilhelm's Germany in the bloody warfare of World War I. America herself was about to become involved in this most tragic of wars, from which the world has yet to sal- vage a formula for peace. In the striped-trouser set and the top-level society of Vienna, young Dulles, the nephew of the American Secretary of State, quickly made his mark; and when America joined the Allies, he along with other members of the June 24, 1961 American delegation skipped across the border to Berne in Switzerland. It was here that Dulles got his first taste of the secret, high-level in- trigue that so often determines the fate of empires and of peoples. As he later told a visitor: "That's when I learned what a valuable place Switzerland was for information- and when I became interested in in- telligence work." Dulles' interest doubtless was stim- ulated by the heady role he played in the very kind of top-drawer, be- hind-the-scenes maneuvering that was to mark the pattern of his later life. By the beginning of 1918, the creaky Austro-Hungarian Empire, exhausted by war, could perceive plainly before it the hideous specter of imminent collapse. Naturally, its Emperor Charles, with a ruler's pri- mal instinct for self-preservation, wanted to salvage as much from the ruins as was possible. His negotiator in this laudable endeavor was his former tutor, Dr. Heinrich Lam- rnasch. Lammasch had met the tall and charming Allen Dulles in Vienna; he was perfectly aware that the young man was the nephew of the American Secretary of State; and so, with an eye to establishing rapport on the highest possible levels, he ap- proached Dulles and through him made arrangements for the salvage talks the Austrians so much desired. The secret discussions which Allen Dulles thus played a key role in ar- ranging began on January 31, 1918, in a villa in Grummlingen, near Berne, belonging to a director of Krupp's. Professor George D. Her- ron, who often carried out secret as- signments for President Wilson, -headed the American delegation. Professor Lammasch and industrial- ist Julius Meinl led the opposing bar- gain hunters. The Austrians were ready to promise almost anything in the hope of preserving the Haps- burg monarchy, and the Americans, evidently blind to the already tar- nished luster of the throne, deluded themselves into the belief that they were really being offered a prize- that the Austrian Emperor might be propped up as "a useful force." Finding these nice Americans so receptive, Lammasch was effusive in his promises. Austria-Hungary would be positively delighted to follow the American lead, in everything, espe- cially if (-does this sound familiar? ) the generous Americans would ex- tend financial aid and help to build "a bridge of gold" between Vienna and Washington. Dulles' immediate superior, Hugh Wilson, was intrigued by the prospect, and all of the Amer- ican delegation seems to have been quite enthusiastic. The British, in- formed of the proposal, were far more skeptical and warned against trust- ing too much in the performance of the Hapsburgs. Events proved the British so right. The Austrian mon- archy collapsed, Charles abdicated, and the net result was a fiasco. Yet Time in 1959 could write of this period that Allen Dulles, in the Switzerland of 1918, "hatched the first of the grandiose plots which were to become his trademark." Introduction to Germany After Berne came the great peace conference at Versailles. Secretary of State Lansing, second only to Wilson among the American negotiators, saw to it that his two nephews had re- ,served seats at the great event. John Foster was given the task of study- ing such financial problems as repa- rations and war debts; Allen had an even more fascinating job as assist- ant' head of the Department of Cur- rent Political and Economic Corre- spondence, a key organization that handled and channeled all cornmuni- cations to the American 'delegation. .Allen Dulles' immediate boss was Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Ellis Dressel, a leading American ex- pert on German affairs and a man who was convinced that the new Soviet Union represented a world menace, one that could be dealt with effectively (shades of 1945!) only through a partnership between Amer- ica and a revived Germany. This was not the prevailing view in that simpler world of 1918 in which hatred of militaristic Germany was the dominating factor. It is sig- nificant niainh because, for its day, it was an extreme view and because Allen Dulles was quite close to Dressel and shared many of his be- liefs. In December, 1918, and again in early 1919, Allen accompanied his superior on trips to Germany during which they conferred with high Ger- man industrialists. The bent of Dul- les' own thinking at the time is indi- cated in a memorandum that he wrote on December 30, 1918, en- titled: "Lithuania and Poland, the Last Barrier between Germany and the Bolsheviks." It evidently was based largely on information gath- ered from Polish and Lithuanian ref- ugees, and it'described the Bolshevik menace in the strongest terms. Dul- les even advocated support of Polish- Lithuanian intervention in Russia, writing: "The Allies should not be deterred from a military expedition because of their fear that it would require hundreds of thousands of men." Peace concluded, Dressel was sent to Berlin as American charge d'af- faires in Germany, and Dulles went with him. Here he was thrown into contact with a stream of German politicians, industrialists and Army officers, many of whom were con- cerned about the new Communist menace and talked about the possi- bility of raising a European army- spearheaded by German generals, of course-to fight the radical Bolshe- viks. Nothing came of these plans, and Dulles soon was transferred to Constantinople. In later years, the stereotyped portrait of Allen Dulles given the American people by virtually all of the large media of information pic- tures a master spy, a super-sleuth, who confounded his rivals in inter- national intrigue from his earliest days. The image, contrasted with Drawing by Berger John Foster Dulles the reality of what came out of Dul- les' first "grandiose plot" at Berne, seems considerably overblown, but it suffers even greater damage when one studies the acid pen portrait of Dulles in action in the Balkans left by a veteran American intelligence officer of the period. Dabbling in Oil The disenchanted agent was Rob. ert Dunn, a veteran and hard-bitten American newspaper man who had received his initial training in skep- ticism at the hands of Lincoln Stef- fens. Dunn later spent nearly twenty years in Naval Intelligence. He was a lieutenant in Turkey in those first years of the 1920s, when Allen Dul- les appeared upon the scene. Years later, in his book World Alive, pub- lished by Crown in 1956, he wrote as follows: And now Mr. Secretary of State Colby's young men were arriving in the flesh to whistle at the nymphs on our office ceiling. Among the cooky-pushers strange to a naval staff came one beetle-browed Boston Brahmin, rich as a dog's insides with copper stock.. . One ' Allen Dulles, freckled, with toothbrush mustache, was a serious grad of the Princeton Golf Club, fresh from Versailles and drawing the fatal boundaries of Czechoslova- kia. Dunn continues by recounting how a London Times reporter hap- pened to find in a second-hand book- stall an ancient volume from which anti-Semitic propagandists obvious- ly had filched the ideas for the Pro- tocols of the Elders of Zion. Neither the Times reporter nor Dunn was very much excited by the discovery because, as Dunn wrote, the Proto- cols had been well exposed by in- ternal evidence as forgeries and hard- ly anyone took them seriously any more. But now (Dunn added), while, Stamboul boiled sedition against the Entente and Kemal chetties threat- ened siege, Dulles decoded to "Sec- state" academic analyses of that stale forgery. No wonder Roosevelt, later, was to growl at diplomatic myopia and the braid-on-cutaway tradition. Such, on Dunn's testimony at least -and he soon took the first oppor- tunity to get out of Naval Intelli- gence because he couldn't stand working with Dulles--was the well- coddled young man who, after two years in the Balkans, was called back to Washington to head the State De- partment's Division of Near Eastern Affairs. The Near East, then as now, was a sensitive area, and for much the same reason-oil. British interests had had a hammerlock on the rich preserves of the entire Mediterranean basin and had tried to freeze out American rivals; but now such com- panies as Gulf and Standard Oil were no longer to be denied. The years during which Dulles headed the key Near Eastern Division were, as it so happened, the very years during which the Rockefeller interests in Standard Oil negotiated a toehold in the Iraq Petroleum Co., and the very years in which the Mellons of Gulf were laying the groundwork for valuable concessions in the Bahrein Islands. Both of these developments became public and official in 1927, the year after Dulles left the State Department to join the New York law firm of Sullivan and Cromwell. His decision was motivated pri- marily by financial considerations. The highest salary he had made with State was some $8,000 a year, and he was a married man, with a grow- ing family. Sullivan and Cromwell (in which older brother John Foster was already a partner) belonged to the legal elite of Wall Street-one of those law firms that have made themselves the virtual brains of big 536 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATrox Approved For Release 2004/03/26 :,CIA-RDP64B00346R000100300061-5 business, supplying indispensable ad- vice on almost every financial, indus- trial and commercial deal. It ad= vised both the Rockefellers and the Morgans; it fairly reeked of the kind of money that solves all a young married man's most acute financial problems. In this plush atmosphere, Allen Dulles quickly made himself at home. Ile had hardly fitted himself into his law chair, indeed, before he be- came involved in the kind of back- stage masterminding that has come to seem almost second-nature to him ever since. The nation in question was the South American state of Colombia. By treaty, Colombia bad awarded the Morgan and Mellon interests the extremely rich Barco Concession, so- called, in Notre de Santander Prov- ince. But in 1926, just as Allen Dul- les was quitting the State Depart- ment, Dr. Miguel Abadia-Mendez was elected President of Colombia. He quickly proved to be a disturb- ing element in the placid world of American oil interests. He threatened to repudiate the Barco Concession; he aroused great popular support; and worried American oil barons de- cided they would have to act. They turned naturally to their legal brains. One such brain was Francis B. Loomis, a former State Department official; another, Allen W. Dulles. Pressure was immediately applied on Abadia-Mendez, but he, stubborn man, wouldn't yield. In August, 1928, he accused the American companies of refusing to pay Colombia what they owed it for the years 1923-26 and reaffirmed his intention of re- voking the Barco Concession. This led -a secretary in the American Em- bassy in Bogota to write Washington that lie was convinced "the Presi- dent will not withdraw his annul- ment of the agreement until he is forced to do so under the pressure of a hard and fast demand." Colombia the Gem Force was applied. The State De- partment sent a sharp note to Bo- gota. Colombia countered by threat- ening to nationalize all her oil fields. The United States served Colombia with a - formal ultimatum. The Mel- Ions threatened an economic boycott. Drawing by Berger Allen Dulles Angry' anti-American demonstrators paraded in the streets of Bogota. The full details of their labors probably never will be revealed, but the effects became obvious. In 1930, Colombia got a new President: Dr. Enrique Olaya Herrera, , a former Colombian ambassador to the United States and a well-known friend of Wall Street bankers. Soon after his election, lie visited New York and was promised a million-dollar loan, provided the Barco Concession was honored. It was. This adventure in the international diplomacy of oil, revealing in its way, was actually little more than a minor vignette in the ascending careers of Allen- Dulles and his older brother, John Foster. The interests and out- look of the two were intertwined al- most inseparably. They were part- ners in the firm of Sullivan and Cromwell; they represented the same clients and the same interests; their two careers moved together in measured cadence, almost like the steps of trained dancers. Most im- portant among their varied -interests, and claiming a major share of their attention, were some of Germany's greatest international cartels. Three of their clients represented the very top drawer of German in- dustry. These were the ' Vereinigte Stahlwerke (The Thyssen and Flick trust), IG Farbenindustrie (the great chemical trust) and the Rob- ert Bosch concern. The legal wits of the Dulles brothers aided all three. At the onset of World War II, the German masters of American Bosch Corp. began to fear for the safety of their holdings, and an elaborate cor- porate cover up was- arranged. The Wallenberg brothers, Swedish bank- ers, agreed to take over American Bosch (with the promise to return it after the war, of course),. but good American front names were needed to provide camouflage. Hence it de- veloped that in August, 1941, just a few months before Pearl Harbor, John Foster Dulles became the sole voting trustee of the majority shares. In 1942, the U.S. Government seized the shares, contending Dulles' trus- teeship was merely a device to cloak enemy interests. Equally close and equally signifi- cant was the role that Allen Dulles played in the great Schroeder inter- national banking house. The parent firm was German and was headed by Baron Kurt von Schroeder. A genuine scar-faced Prussian, the Baron played a key role in the acces- sion to power of Adolf Hitler. It was in his villa at Cologne on January 7, 1933, that Hitler and von Papen met and worked out their deal for the Nazi seizure of power. In sub- sequent years, von Schroeder remain- ed close to the Nazi hierarchy. He was made SS Gruppenfuehrer (the equivalent of general), and he was chairman of the secret "Frenden- Kreis S," which collected funds from Ruhr magnates to finance Heinrich Himmler. Outside Germany, the Schroeder financial empire stretched long and powerful tentacles. In Eng- land, it had J. H. Schroeder Ltd.; in the United States, the Schroeder Trust Company and the J. Henry Schroeder Corporation. Allen Dulles sat on the boards of directors of both. Almost any lawyer would contend, of course, that there is nothing wrong with selling his talents where the money is and that he has a perfect right to represent any client, no mat- ter what his pedigree. The Dulles June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 S37 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 brothers, however, did not just bap., pen to represent an isolated German client or two; they represented the elite of German industry, firms close- ly tied to the Nazi machinery, over a long period of time, on the closest terms and even in directoral capaci- ties. Granted the complete propriety of the representation, it would be naive in the extreme to believe that such multiple, close associations do, not sway political judgments. In the long-forgotten records of the times, there are indeed some in- dications that this was so. In April, 1940, for example, Dr. Gerhart A. Westrich, one of Germany's leading lawyers, a man who had handled some European affairs for Sullivan and Cromwell, came to America by way of Siberia, ostensibly as Hitler's .special emissary to consult with American businessmen. He establish- ed residence on a swank New York suburban estate and before long he. was consulting, .not just with Ameri- can oil and industrial tycoons, but with a strange assortment of factory workers and mechanics. The New York Herald Tribune exposed this suspicious activity and charged that Westrich had made misrepresenta- tions' in applying for a driver's li- cense. John Foster Dulles imme- diately came to the Nazi agent's de- fense. "I don't believe he has done. anything wrong," John Foster said. "I knew him in the old days and I had a high regard for his integrity." American agents began an investiga- tion, however, and in two weeks Dr. Westrich was on his way to Japan.. The Westrich affair, inconclusive: in itself, assumes greater significance when one considers the Anglo-Amer-? ican Fellowship and the America First Committee. In Britain, the London branch of the Schroeder banking firm financed the Fellowship and concentrated on selling the Munich brand of appease-. merit to the British people. The Fel-? lowship sought as members promi- nent names in the Conservative Par- ty, big businessmen, bankers. These eminents were given the VIP treat- ment on conducted tours of Ger- many; they were entertained by Hitler and Goering, and von Rib- bentrop exercised all the wiles of propaganda to sell them on the vir- WANTE D Baron Kurt v. SCHRODER BORN. Aug.24, 1889. PARTY NUMBER: 1475919 SS NUMBER: 276904 Former residences: K61n: Hollendla Villa, Rheinallee; Bonn: Rolandseck. Any information relative to the above mentioned subject should be forwarded Immediately las JOINT SPECIAL FINANCIAL DETACHMENT U. S. GROUP CONTROL COUNCIL CONTROL COMMISSION FOR GERMANY (BRITISH ELEMENT) DgSSELDORF. This "Wanted" poster was distributed by British and U.S. Military Governments immediately after the war. ,tues of the Nazi system. There was no secret about, this activity, no doubt about its aims and purposes. And so it is intriguing to find prom- inently listed as members of the Fel- lowship not just the banking house of J. H. Schroeder Ltd. itself, but the individual names of 11. W. B. Schroeder and H. F. and F. C. Tiarks (see Tory M. P. by Simon Hoxey, published in England by Vic- tor Gollancz). F. C. Tiarks actually served on the Fellowship's council, or governing body, and H. W. B. Schroeder and the two Tiarkses sat with Allen Dulles on the board of the J. Henry Schroeder Banking Corp. On this side of the Atlantic, the incorporation papers for the America First Committee, devoted to persuad- ing Americans to keep out of World War II, were drawn up in John Foster Dulles' law office. Records of America First subsequently showed that John Foster, the more famous of the two brothers during most of their 'lifetimes, supported America First financially. In February, 1941, his wife contributed $250, and in May, 1941, another $200. On Novem- ber 5, 1941, just one month before Pearl Harbor, America First records listed a $500 contribution from "John Foster Dulles." Dulles himself, when questioned about these ties, protest- ed: "No one who knows me and what I have done and stood for con- sistently over thirty-seven years of active life could reasonably think that I could be an isolationist or `America Firster' in deed or spirit." Yet the deed, and the spirit seem- ed to be implicit in a series of pub- 538 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Tka, NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 lic speeches that John Foster Dulles made in the months before Pearl Harbor. On at least three occasions, he ridiculed the notion that America faced any danger from the Axis pow- ers. These, he said, were simply "dy- namic peoples" seeking their rightful place in the sun. In a speech before the Economic Club of New York in March, 1939, he said: There is no reason to believe that any totalitarian states, separately or collectively, would" attempt to attack the United States or could do it successfully. Certainly it is well with- in our means to make ourselves im- mune in this respect. Only hysteria entertains the idea that Germany, Italy or Japan contemplates war upon us. There is no public record that Al- len Dulles shared either .his brother's sanguine world outlook or interest in America First. But equally there is no record, public or private, that he didn't. All one can say is that, throughout their careers, the two brothers displayed a . marked com- munity of political views. Then came Pearl Harbor. When it did, a whole new career opened up for Allen Dulles. During his service in the State Department years before, he had become friendly with an Assistant Attorney General named William J. (Wild Bill) Don- ovan. When Pearl Harbor plunged us into World War II, Donovan was picked to head America's first super- ispy outfit, the Office of Strategic Services. He promptly contacted Al- len Dulles and urged him to go to his old familiar stamping grounds in Berne, Switzerland. There Allen was to set up a European espionage headquarters, The reason Donovan picked him for the task was that he wanted a man who had high con- tacts inside Nazi Germany. On this score, Allen Dulles certainly quali- fied. PART III DULLES AND THE SS THE OFFICIALLY favored version of Allen Dulles' exploits in Switzer- land in World War II goes like this: He was the very last American to slip legally across the French border in November, 1942, as German troops came pouring into Vichy France in swift reaction to the Allied invasion of North Africa. His assignment in Switzerland was to find out who in Germany might be opposed to the Hitler regime and whether they were working actively to overthrow it. In true master-spy tradition, he put out his feelers and soon the fish were swimming into his net; soon secret anti-Nazis were coming to him to funnel him vital information and to give him the most intimate details about the plot to do away with Hitler. Some of this happened, but it isn't all that happened. To understand the significance of developments in Berne, one needs to recall the back- ground of the times. In January, 1943, just as Allen Dulles' intelli- gence-gathering operation began to get going in full swing, Churchill and Roosevelt were meeting in Casa- blanca for the first of those Summit conferences that were to determine the conduct of the fighting and, more important, the conditions for ending it. It was at Casablanca that the two great Allied leaders proclaimed the doctrine of "unconditional sur- Iune 24, 1961 render" and vowed to "spare' no ef- secret agents, proposed a bold solu- fort to bring Germany to her knees." tion to his boss. Himmler, the master Their proclamation came at a time of the secret police for whom Kurt when a witch's brew was already von Schroeder had raised funds in boiling inside Germany. German the Ruhr, was a cautious man where military strategy long had been predi- his own neck was involved; but he cated on avoiding a war on two was extremely ambitious, too-and fronts. This had been a cardinal prin- so he listened to Schellenberg. Schel- ciple of Hitler himself until the seem- lenberg argued that the war was lost ingly endless succession of easy vic- unless a "political solution" could be tories unbalanced his judgment and arranged. Only Himmler, he contend- propelled him into war with the So- ed, could achieve this. Only Himmler viet Union. The 'limitless void of Rus- could intrigue to spread dissension sia quickly began to engulf the Nazi among the Allies, to split them war machine, and then, on top of the apart, to achieve the needed separate Eastern struggle, had come the Jap- settlement with the West. Himmler anese stroke at Pearl Harbor, a blow hesitated, caution warring with am- that had surprised Hitler almost as bition. The argument between him much as it had the American fleet. and Schellenberg lasted until 3:30 This development had thrown the A.M., but Himmler finally agreed to tremendous power and resources of try 'Schellenberg's idea. . America into the scales against the The prize at stake was enormous. Axis powers, and soon both German If he succeeded, Himmler could make generals and the more astute leaders himself master of all Germany. The of the SS saw that ultimate defeat ruthless SS chief was well aware, as was inevitable unless some compro- William L. Shirer makes clear in The mise political settlement could be Rise and Fall of the Third Reich, worked out with the Allies. A num- that military cliques were plotting ber of top-level conferences were de- the assassination of Hitler. On occa- voted to this problem, both in the sion Himmler made a great pretense camp of the military and the camp of activity and sent some of the more of the SS. obvious bunglers before execution In one of these secret conclaves in squads, but it seems certain he could August, 1942, SS-Brigadefuehrer have protected the Fuehrer much Walter Schellenberg, one of Heinrich more efficiently than he did. It seems Himmler's brightest proteges and certain also that he gave the plotting one of the most dangerous of Nazi generals loose rein, anticipating the S9 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 situation that would develop if and when they succeeded in blowing up his revered leader. Himmler, with his iron grip on the machinery of the secret police, felt fully competent to deal with the generals; he feared no other rival in the Nazi party; and if, in foreign affairs, he could achieve Schellenberg's "political solution," he could perpetuate the Nazi system with himself in Hitler's shoes. Meet "Mr. Bull" Such appear to be the compelling reasons that led Himmler and Schel- lenberg to send two SS agents to seek out Allen Dulles in Berne. The SS agents were a Dr. Schudekopf and Prince Maximillian Egon Hohenlohe. The Nazi version of these negotia- tions was contained in three docu- ments written at the time, labeled "Top Secret," and preserved in the files of SchelIenberg's dreaded De- partment VI of the SS Reich Security Office. Bob Edwards, a member of the British Parliament, cites these documents and quotes them fully in a pamphlet written this year, A Study of a Master Spy (Allen Dul- les). In studying his account, upon which the following section is based, it must be borne in mind that the documents represent an enemy ver- sion of the talks and must therefore be read with caution; nor should it be forgotten that in the shadow world of the secret agency, duplicity is a common coin and truth most difficult to determine. Edwards, who fought with Loyal- ist forces in Spain during the civil war in the 1930s, has been general secretary of the Chemical Workers Union since 1947. He is a former member of the Liverpool City Coun- cil and has served in Parliament, elected with Labour and Co-opera- tive backing, since 1955. He attract- ed considerable attention when he began protesting in the House of Commons about the activities of the Krupps in Bilbao and the danger of permitting the Germans to establish bases in Spain. As a result, "from absolutely reliable sources in Bonn," he says, he received a number of documents, including the three deal- ing with Dulles and the SS. The first of these documents is a brief covering letter, of which only one copy was made. It is dated April 30, 1943, and is..from SS-Haupt- sturmfuehrer Ahrens to Department VI, dealing with: "DULLES, Roose- velt's special representative in Switzerland." The second is a record of conversations between Dulles, re- ferred to throughout the report as "Mr. Bull," and Prince Hohenlohe, called "Herr Pauls." The conversa- tions took place in Switzerland in mid-February, 1943. "Immediately on arrival," accord- ing to the memorandum on the Dul- les-Hohenlohe talks, "Herr Pauls" received a call from a "Mr. Roberts," a Dulles aid and confidant. Roberts was anxious to arrange an immediate meeting with his chief, Allen Dulles. Hohenlohe stalled until he could check up on Dulles. From Spanish diplomats, from the Swiss and from representatives of some of the Nazi satellite states in the Balkans, Ho- henlohe learned that Dulles operated on the very highest level, apparent- ly with a direct pipeline into the White House, by-passing the State Department. This convinced the SS agent that he should, by all means, see "Mr. Bull." He was greeted, he reported, by "a tall, powerfully built, sporting type of about forty-five, with a healthy appearance, good teeth and a lively, unaffected and gracious manner. Assuredly a man of civic courage." The conversation was cor- dial. Hohenlohe and Dulles quickly established that they had met be- fore, in 1916 in Vienna and in the 1920s in New York. With these pre- liminaries out of the way the SS re- port of the talk between "Herr Pauls" and "Mr. Bull" continues: Mr. Bull said . . . he was fed up with listening all the time to out- dated politicians, emigres and prej- udiced Jews. In his view, a peace had to be made in Europe in the preservation of which all concerned would have a real interest. There must not again be a division into victor and vanquished, that is, con- tented and discontented; never again must nations like Germany be driven by want and injustice to desperate experiments and heroism. The Ger- man state must continue to exist as a factor of order and progress; there could be no question of its partition or the separation of Austria. At the same time, however, the might of Prussia in the German state should be reduced to reasonable proportions, and the individual regions (Gau) should be given greater independence and a uniform measure of influence within the framework of Greater Germany. To the Czech question, Mr. Bull seemed to attach little impor- tance; at the same time he felt it necessary to support a cordon saui- taire against Bolshevism and pan- Slavism through the eastward en- largement of Poland and the preser- vation of Rumania and a strong Hungary. German Hegemony If t;bis view seems hardly in ac- cord with the publicly avowed Roose- velt-Churchi]l program of "uncondi- tional surrender" and bringing "Ger- many to her knees," the rest of the Dulles philosophy, according to this SS report, seems to agree even less with the ideals for which thousands of Allied soldiers were at that mo- ment dying. "Herr Pauls" reported that "Mr. Bull seemed quite to rec- ognize" Germany's claim to indus- trial leadership in Europe. "Of Rus- sia he spoke with scant sympathy. ... Herr Pauls had the feeling that the Americans, including in this case Mr. Bull, would not hear of Bol- shevism or Pan-Slavism in Central Europe, and, unlike the British, on no account wished to see the Rus- sians at the Dardenelles or in the oil areas of Rumania or Asia Minor." Indeed, as "Herr Pauls" noted later, 10 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 "Mr. Bull" made no great secret, though he, did not speak in detail, about "Anglo-American' antago- nisms." The conversation now took an abrupt turn. "Herr Pauls" made what he described as "a very sharp thrust on the Jewish question" and said he "sometimes actually felt the Ameri- cans were only going on with the war so as to be able to get rid of the Jews and send them back again. To this `Mr. Bull' replied that in America things had not quite got to that point yet and that it was in general a question whether the Jews wanted to go back. Herr Pauls got the impression that America in- tended rather to send off the Jews to Africa." Discussing the, reorganization of postwar Europe, "Mr, Bull" appeared to reject British ideas "ita toto." Hoheniohe reported: He agreed more or less to a Europe organized politically and industrially on the basis of large territories, and considered that a Federal Greater Germany (similar to the Thiited States), with an associated Danube. Confederation, would be the best guarantee of order and progress in Central and Eastern Europe. He does not reject National Socialism in its basic ideas and deeds so much as the "inwardly unbalanced, inf eriority- cornplex-ridden Prussian ' mlitarism." (Italics added.) Then Mr. Bull turned to the sub- ject of National Socialism and the person of Adolf Hitler and declared that with all respect to the historical importance of Adolf Hitler and his work it was hardly conceivable that the Anglo-Saxons' worked-up public opinion could accept Hitler as un- challenged master of Greater Ger- many. People had no confidence in the durability and dependability of agreements with him. And re-estab- lishment of mutual confidence was the most essential thing after the war. Nevertheless, Herr Pauls did not get the impression that it was to be viewed as a dogma of American prejudice. . . . The conversation continued with Hohenlohe trying to get some inkling of Allied military intentions and with Dulles fending off his queries. The American agent did deliver, however, a pointed warning. He cited Amer- ica's "expanding production of air- craft, which will systematically be brought into action against the Axis powers." Then: Mr. Bull is in close touch with the Vatican. He himself called Herr Pauls's attention to the importance of this connection, for the American Catholics also have a decisive word to say, and before the conversation ended he again repeated how greatly Germany's position in America would be strengthened if German bishops were to plead Germany's cause here. Even the Jews' hatred could not out- weigh that. It had to. be remembered, after all, that it had been the Ameri- can Catholics who had forced the Jewish-American papers to stop their baiting of Franco Spain. The third top-secret Nazi docu- ment deals with another talk be- tween "Mr. Roberts," Dulles' right- hand man, and another SS agent, identified only as "Bauer." This took place in Geneva on Sunday, March 21, 1943. It was a long, rambling, inconclusive 're'hash of the war and its issues, but certain strong strands emerge in the SS report. "Bauer" quoted Roberts as saying "he [Rob- erts] did not like the Jews and it was distasteful to think that they were now able to adorn their six- pointed star with an additional wreath of martyrdom. . . ." The cool- ness toward the British, the pro- German warmth was there. "Bauer" quoted Roberts: America had no intention of going to war every twenty years and was now aiming at a prolonged settle- ment, in the planning of which she wished to take a decisive part and did not wish to leave that again to Britain, bearing in mind the bitter experience of the past. It would be nothing else but regrettable if Ger- many excluded herself from this set- tlement, for that country deserved every kind of admiration and meant a great deal more to him than any other countries. flow Much Truth? The impact of these reports, read eighteen years later, can only be de- scribed as shocking. The picture that emerges is of a Dulles perfectly will- ing to throw the Austrians and the Czechs (whom the Allies then were publicly pledged to free) to the wolves; a Dulles who "does not re- ject National Socialism in its basic ideas and deeds," despite the smok- ing furnaces of the Nazi charnel houses; a Dulles who, blaming all on Prussian militarism, was looking forward to seeing a strong and re- surgent Germany dominating all of Central Europe; a Dulles who was concerned primarily (as the Dulles of 1918 had been) with using Ger- many and Poland as buffers against Russia in the East; a Dulles who was concerned, as one would expect the Dulles of the 1920s to be, with keep- ing Russia out of the oil-rich Near East; a Dulles who seemed still to regard the British with a small "b," who looked with equanimity (as the Dulles who had represented some of the mightiest German corporations might be expected to do) upon Ger- man industrial leadership of Europe -a Dulles who paid "respect to the historical importance of Adolf Hitler and his work," who thought Hitler would have to go, but who did not make this seem like "a dogma of American prejudice." One finds oneself asking the shock- ed question: Was this the real Al- len Dulles? It is not easy to decide. Always, in anything that touches upon the double-dealing shadow world of the secret agent, one must have more than normal reservations. This pic- ture of Dulles is the picture that emerges from SS reports, but per- haps SS agents, like a lot of other secret agents, might have been tempted to tell headquarters what they knew headquarters wanted to hear. Even if the SS reports were completely accurate, there is no guar- antee that Dulles actually believed all that the reports attributed to him. He was trying to pick the minds J"O, 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 541 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 of his SS callers, as they were trying to pick his, and in the brain-picking duel, any agent might be likely to cloak, to a degree at least, his real beliefs and intentions and to pretend to what he did not really feel. Was this what Dulles was doing? Was he being extremely cordial and agree- able to Hohenlohe merely in the hope of luring information out of him? Or were at least some of those senti- ments he expressed really his own? Whatever the truth, there is no imputation in these documents that Allen Dulles was anything but a patriot seeking to further what he conceived to be the best interests of his country. Not his motives, but his judgments, are called into ques- tion as one peruses these SS records. In any case, the SS portrait must be assessed against some check- points-Dulles' own known back- ground and certain future develop- ments, all of which seem to fall into a pattern. Dulles certainly played the master's role in cloak-and-dagger activities in Europe. He remained the boss of the Berne nerve center of intelligence throughout the war, and he came out of the conflict with an overpowering reputation as Ameri- ca's master spy. Under the circum- stances, it is curious to find that the pattern of German rapprochement described in Hohenlohe's report was repeated again and again in other secret dealings by American agents. uniting the Western Allies with Ger- many for the "struggle against Bol- shevism." These repeated overtures would make it seem as if someone some- where had some pretty determined ideas about a soft German peace and the building up of a strong post- war Germany to combat the Soviet menace. All of this occurred at a time when Russia ostensibly was our Ally and was locked in the fiercest of death grapples with Germany. If the Russians, who had their own spy system, were aware of these secret machinations - as they may well have been, for, according to the Ger- mans, Hungarian agents had broken the code Dulles was using-the seem- ingly unreasonable Russian distrust of America would begin to seem less unreasonable. Such are the penalties of an intelligence operation that runs surance-that, if they killed Hitler, Washington would support them in setting up a new and presumably anti-Nazi government. The German conspirators did not just ask for Washington's backing; they held out a threat. If the West- ern democracies refused to grant Germany a decent peace, they warn- ed, they would be compelled to turn to Soviet Russia for support. This, it would seem, was hardly the tone of men inspired by great ideals. As Shirer perceptively remarks: "One marvels at these German resistance leaders who were so insistent on get- ting a favorable peace settlement from the West and so hesitant in getting rid of Hitler until they got it. One would have thought that if they considered Nazism to be such a monstrous evil ... they would have concentrated on trying to overthrow it regardless of how the West might treat their new regime." No such re- flection appears to have occurred to Dulles. He was inclined to accept the demands of the plotters and urged Washington to back the bar- gain, to promise favorable terms of peace. In this he failed. Roosevelt in- sisted on "unconditional surrender." In the light of what we now know, the wisdom of the deal proposed by Dulles appears to be highly dubious. For a "Soft" Peace One of these negotiations took place in October, 1943, when Dr. Felix Kersten, a Finnish masseur who had won the confidence of Himmler himself, went to Sweden to confer with an unnamed American agent. They discussed "the danger from the East" and "a compromise peace." Tentatively, they agreed on the res- toration of Germany's 1914 bound- aries (this would have included France's Alsace-Lorraine), the end- ing of the Hitler dictatorship, re- duction of the German Army, con- trol over German industry, and an American pledge to forget about an enlarged Poland. Still later, in the spring of 1944, another American feeler was put out by a secret agent in Yugoslavia, again for negotiations counter to the official policy of the One thing is certain: Himmler knew nation employing it. of the plots against Hitler and de- Whether Dulles himself had any liberately left enough of the plotters responsibility for the persistent pro- free to score the near-miss of the German feelers is not established, but 1944 bomb explosion in Hitler's East there is one further strong indication Prussian headquarters. Himmler cer- of his attitude toward Germany in tainly had every intention of domi- one of his best-publicized exploits. nating the Germany that would have Not long after his arrival in Berne, survived the loss of the Fuehrer, and he received a call from an emissary there can be little doubt that, if he connected with the military side of had been successful, the Nazi system the crosshatch of plots involving the would have been perpetuated. This, destruction of Hitler. His caller was at least, the doctrine of "uncondi- Hans Bernd Gisevius, German vice tional surrender" avoided. The corn- consul in Zurich and a member of plete crushing of Germany, the free- the Abweh.r, the secret intelligence. ing of the wraiths in its concentra- Gisevius was a huge, 6-foot-4 Ger- tion camps-total victory and its man who had been connected with revelations-made any apologia for anti-Hitler plots in 1938 and 1939, Nazism impossible. before the outbreak of the war. He Such an outcome could hardly had close connections with some of have been achieved by the Allen Dul- Germany's top military leaders, who les who peeps out at us from the had long been convinced that Hitler pages of SS reports or by the Allen would have to be removed from the Dulles who was ready, by his own scene. From Dulles, Gisevius and his admission, to deal with the military that would involve the possibility of fellow plotters wanted just one as- plotters. 542 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 PART IV DULLES, PEACE and the CIA ALLEN DULLES came back from Berne with such a reputation as a cloak-and-dagger mastermind that his exploits are still spoken of with awe. He was decorated with the American Medal of Merit, a Presi- dential Citation, the Medal of Free- dom, Belgium's Leopold Cross and France's Legion of Honor. These medals represented several triumphs in espionage. The greatest feats stemmed from Dulles' contact with an employee in the German Foreign Office who has been identified only as "George Wood." A secret anti-Nazi; "Wood" risked. death many times to make contact with Dulles in. Berne. At each meeting, he delivered to the Amer- ican agent copies of ultra-secret Ger- man documents. The impressive to- tal of 2,600 documents reportedly was funneled into Dulles' hands by "Wood." Some are said to have been of such. importance that they vitally affected the course of the war. According to the Dulles legend, documents supplied by "Wood" gave the first clue to German experiments with the V-1 and V-2 rockets at the Peenemunde testing base on the Baltic. Dulles' information, it is as- serted, warned the Allies in time, en- abled them to raid Peenemunde with 'their heavy bombers, and set the rocket program back an all-important six months. There is no doubt that the raid on Peenemunde did just this, but there is considerable doubt whether Dulles can claim sole credit for it. Winston Churchill, in his history of World War II, writes that German experi- meiits with rockets at Peenemunde were known even before the war and that as early, as the autumn of 1939 "references to long-range weapons of various kinds began to appear in our Intelligence reports." Edwards, the British M.P., writes categorically: Finally, it is a well known fact that it was not Mr. Dulles who distin- guished himself by discovering the V-rockets, but unassuming Miss Con- stance 13abbingtoii Smith, the British expert on aerial reconnaissance pho- tography, who on June 23, 1943, iden- tified the launching ramps on an aerial photograph of Peenemunde. The British Secret Service had known about plans for building them ever since 1939. Fewer questions have been raised about some of Dulles' other exploits. One of these dealt with a mysterious Nazi spy by the name of "Cicero." Edwards insists that the full story of "Cicero" has not yet been told, but the accepted version goes like this: From some of the documents given him by "Wood," Dulles learned that the British Ambassador in Turkey, Sir Hughe Knatchbull-Hugessen, had a valet who was actually a Nazi spy and who used the code name of "Cicero." The tip about "Cicero" came to Dulles just in time to alter the route of an American convoy and save it from a planned U-boat attack. Even more important than saving a convoy was the ' final achievement credited to Dulles-the surrender of the German Army in Italy in 1945. Dulles arranged this through his con- tacts in the SS, specifically, through negotiations with SS-Obergruppen- fuehrer Karl Wolff. As a result, the German surrender in Italy came earlier than otherwise might have been the case, and presumably the lives of thousands of Allied soldiers were saved. The Dulles Ambivalence With war's end, Dulles returned for a time to his law desk at Sullivan and Cromwell, but with his glamor- ous (and glamorized) World War II masterminding behind him, it was hardly to be expected that world events would leave him long alone. Both he and his older brother, John Foster, now began to emerge on the national scene in new and ever more powerful roles. The build-up for both was, and was to remain, tremendous. The nation's largest news media agreed with virtually a single voice that John Foster Dulles was the in- fallible wise man of foreign policy; his ties to top-level German industry under the Nazis, his links to America First, his speeches proclaiming we had nothing to fear from the Axis, were all forgotten. Only some mav- erick columnists like Drew Pearson, 1. F. Stone, Dr. Frank Kingdon and Harold L. Ickes remembered the past. And who were they to outshout New York's Governor Thomas E. Dewey, who discovered and proclaimed (years before Eisenhower) that John Foster Dulles was "the greatest statesman in the world" and "the only man in the world whom the Russians fear"? Then and Since Under the cover of such authorita- tive proclamations of highly disput- able fact, the American public as a whole completely forgot that the Dulles brothers had been the high legal priests and the helpful manip- ulators of some"of the greatest Ger- man trusts; and little significance seems to have been attached to the curious coincidence that, in the im- mediate postwar era, they became the spokesmen for a compassionate German'policy. With the adaptabil- ity of lawyers and politicians, they seemed at times to ride both sides of the issue, but in the final analysis their weight appears to have been thrown on the pro-German side. Typical of this ambivalence was the performance of Allen Dulles in the days right after the guns were silenced.. In an article he wrote in Collier's in May, 1946, he based his lead paragraph on the events of 157 B.C., comparing Berlin with Carthage. `Berlin remains a monu- ment to Prussian and Nazi philoso- phy," he wrote. He suggested it might be a good idea to leave in the heart of Berlin a completely devas- tated area as a perpetual reminder of what the Nazis and Prussian mili- tarism had wrought. "The central area, for example, a half mile radius around Hitler's Chancellory," he ex- plained, "might be set aside as a perpetual memorial to the Nazis and to Prussia." Berlin should no longer be the capital of Germany; it should be relegated to an inconsequential June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 $4 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 role as a mere railroad and commer- cial center because "Berlin has lost its birthright. . . . It has lost it be- cause for generations this city has housed the chief disturbers of world peace. Hence, as the capital of Ger-, many, Berlin `delenda est."' Yet, in less than two years' time, Allen Dulles appeared to be worry- ing less about the horrors of Nazi and Prussian militarism and more about the virtues of a strong Ger- many. When Congressional commit-, tees began debating the European. Recovery Program, former President: Herbert Hoover, John Foster Dulles and Allen Dulles were among the leaders in the drive to rebuild Ger- man industry-with which the Dul- leses, at least, had had the strongest kind of personal and financial ties. Describing this effort, Helen Fuller wrote in The New Republic in Feb-, ruary, 1948: For months, the Herter Committee on European aid has been passing for a high-minded, bipartisan group of Good Samaritans. Actually, the Herter bill that is- being urged as a substitute for ERP was mainly a Hoover product. Chairman Christian A. Herter (R., Mass.), a Hoover protege, allowed Allen Dulles, inter- national banker and friend of Hoover, to do the drafting, called in other like-minded Wall Streeters to help. The author went on to describe the "snail's pace" dismantling of German industry abroad, the concen- trated "strong Germany" propa- ganda drive in the United States? She quoted John Foster Dulles' tes- timony, which seemingly straddled. both sides of the issue. John Foster favored reparations and control; but he insisted it wouldn't be economical to duplicate Germany's steel indus- try in France, and all Western Euro- pean countries would be positively "delighted to see Germany restored. and smoke pouring out of the fac- tories of the Ruhr as rapidly as pos- sible." Acidly, Helen Fuller wrote: "The Inter-Allied Reparations Agen- cy could show Dulles fat official rec-? ords to the contrary. France, Bel- gium, the Netherlands and many others want German equipment with which to rebuild their own devas- tated economies." This is the background from which the "strong Germany" policy of to-- day was to emerge. Whether the Ger- mans of today are a completely dif- ferent race from the Germans of the past who brought two of history's most horrible wars upon the world, whether the "strong Germany" pol- icy represents the acme of wisdom or a disastrous gamble in power poli- tics-these are questions that only the future can decide. What is im- portant here is to understand some of the pressures producing the policy. When one examines these, one finds the Dulleses advocating a public policy that coincided neatly with the dictates of what had been their long- time private interests. The Allen Dulles of 1918, of 1942-45, of 1947- 48, seems the same man, with the same strong alliances to top-level Germans regardless of their ideology; and it is this strong pull of private ties that becomes so disturbing when one tries to analyze the public per- formance of the man who was soon to become head of CIA. Birth of the CIA The agency itself was essentially the creation of President Harry S. Truman, and it resulted almost in- evitably from the painful lessons of World War II. Pearl Harbor had had a permanent and understandable ef- fect upon the thinking of American leaders. In the post-mortems con- ducted into that disaster, it had be- come apparent that ample informa- tion was available in Washington to have alerted Army and Navy com- manders at the Pearl Harbor base of their danger; but no effective use had been made of the available in- telligence, largely because there was no single agency entrusted with the accurate and speedy interpretation of such detail. The emergencies' of war led to the hasty creation of OSS, but OSS was obviously a stopgap measure, not a final solution. On October 1, 1945, immediately after the cessation of hostilities, Tru- man abolished OSS. The President apparently had a personal distaste for the nasty business of spying, and he was, in addition, under bureau- cratic pressures from all sides to de- capitate OSS as quickly as possible. The military intelligence services wanted no such powerful competitor; the FBI under J. Edgar Hoover long had felt it should be the sole gather- er and dispenser of vital information, both at home and abroad; and the Department of State and the Bu- reau of the Budget both had the knives out for OSS. With the disso- lution of the agency, however, a cha- otic situation quickly arose. Intel- ligence reports from all the competing intelligence-gatherers flowed in be- wildering profusion across the Pres- ident's desk. Frequently, no two agencies agreed on anything; fre- quently, their analyses and predic- tions flatly contradicted one another. The result was that the President was almost as badly off from this plethora of advice as he would have been if he had had no advice at all, and he was left largely to follow his own hunches. This obviously was no way to chart strategy among the perilous reefs of the cold war, and various solutions were proposed. Donovan, as early as 1944, had suggested to Roosevelt the creation of a central intelligence agency so powerful it would dominate the entire field. Op- position to such a monolithic struc- ture was led by the Navy, which took the position that each of the services, with its own special requirements and ends in view, needed its own agents. Admiral King, in addition, foresaw in a powerful central intelligence a possible threat to democracy, and in Congress there were very real fears lest, in our hunt for intelligence, we create a potential Gestapo. Giant Step Forward The result was a compromise. Tru- man, by Executive order on January 22, 1946, set up the Central Intelli- gence Group, the forerunner of the present CIA. This was to be, as Ran- som explains in his authoritative book, primarily "a holding company coordinating the work of existing de- partments." It functioned under an executive council, the National In- telligence Authority, composed of the Secretaries of State, War and Navy, and the President's personal repre- sentative. Under this setup, the prac- tice began which continues today of having central intelligence provide for the President's personal eye a daily, exclusive and unified digest and summary of all important inter- 544 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 national intelligence. Truman, un- derstandably, felt that a great step forward had been taken. "Here, at last," he writes in his memoirs, "a coordinated method had been work- ed out, and a practical way had been found for keeping the President in- formed as to what was known and what was going on." The Central Intelligence Group, however, was only a temporary ex- pedient, as OSS had been before it; and Congress, in ordering the seini- unification of the defense establish- ment in 1947, abolished CIG and created the present Central Intelli- gence Agency, functioning under a National Security Council, compar- able to the former National Intelli- gence Agency. Before final action was taken, the advice of Allen Dulles was sought. This he gave in a signifi- cant memorandum dated April 25, 1947. Dulles made six principal recom- mendations. CIA, he thought, should have absolute control over its own personnel; its chief should not have men foisted upon him for political or other reasons, but should have full say in picking his own assistants. The agency should have its own budget and the right to supplement this by drawing funds from the Departments of State and National Defense. CIA should have "exclusive jurisdiction to carry out secret intelligence op- erations." It should have "access to all intelligence information relating to foreign countries." It should be the "recognized agency for dealing with the central intelligence agen- cies of other countries." And, finally, it should have "its operations and personnel protected by `official se- crets' legislation which would pro- vide adequate penalties for breach of security." Principle of Separation In his comments on the proposed agency, Dulles made several impor- tant observations. CIA, he felt, should be predominantly civilian ra- ther than military in its high com- mand, and if a military man was ap- pointed to head it, he should become a civilian while he held the office. Its administration, he felt strongly, must have long-term continuity and pro- fessional status; its director should For the home of a secret agency, the new Washington headquarters of the CIA is on the resplendent side. be assured of long tenure, like Hoover in the FBI, "to build up public con- fidence, and esprit de corps in his organization, and a high prestige." He opposed the creation of an agency that would become "merely a coordi- nating agency for the military intel- ligence services"- and warned that this "is not enough." Most signifi- cantly, in view of the future course of events, he recognized the dangers inherent in wedding information to policy. The State Department . . . [he wrote] will collect and process its own information as a basis for the day- to-day conduct of its work. The Arm- ed Services intelligence agencies will do likewise. But for the proper judg- ing of the situation in any foreign country it is important that the in- formation should be processed by an agency whose duty it is to weigh facts, and to draw conclusions from those facts, without having either the facts or the conclusions warped by the inevitable and even proper preju- dices of the men whose duty it is to determine policy and who, having once determined policy, are too likely to be blind to any facts which might tend to prove the policy to be faulty. The Central Intelligence Agency should have nothing to do with pol- icy. It should try to get at the hard facts on which others must deter- mine policy. The case could not be put better. With this strong, explicit statement, virtually every expert on the sub- ject has always been in complete agreement. But, unfortunately, this wasn't the way CIA was to be set up, and this wasn't the way that in- creasingly, under Allen Dulles him- self in later years, it was to run. Rumors that this cardinal prin- ciple of intelligence-the separation of information from the roles of pol- icy and action-might be flouted by the new spy outfit were current even as it was being created. In the hearings on the National Security Act of 1947, Congressman Fred Busbey sounded an anxious note. "I wonder," he asked, "if there is any foundation for the rumors that have come to me to the effect that through this Central Intelligence Agency, they are contemplating operational activities?" The question wasn't answered at the time, but the act in its final form left the door open and "they" walked through. The Security Act charged CIA with five specific functions: to advise the National Security Coun- cil on intelligence matters related to national security; to make recom- mendations to the council for coordi- nation of intelligence activities of departments and agencies of the gov- ernment; to correlate and evaluate intelligence and provide for its ap- propriate dissemination within the government; to perform for the bene- 545 June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 fit of existing intelligence agencies such additional services as the NSC might determine could be more ef- ficiently handled centrally; and fi- nally, most important, "to perform other functions and duties" relating to national security intelligence as thr NSC might direct. It is this "ocher functions and duties" clause that gave CIA broad powers to enter, not just the field of intelligence, but the field of overt activities. The Principle Violated The concentration of power in the hands of the agency, implicit in its organization, was increased tre- mendously by revisions of the CIA statute made in 1949. Three major changes placed almost dictatorial powers in the hands of its director. He was given the right to hire and fire without regard to Civil Service or other restraints. CIA was exempt.. ed from the provisions of any laws that might require publication or dis. closure of the "organization, func- tions, names, official titles, salaries or numbers of personnel employed" (even the Bureau of the Budget was directed specifically to make no re- ports to Congress on any of these matters; in other words, CIA be- came a completely closed book). At the same time, its director was given full authority to spend any amount on his personal voucher, without ac-: counting. "This," as Ransom com- ments, "is truly an extraordinary power for the head of an Executive agency with thousands of employees and annual expenditures in the hun- dreds of millions of dollars." To counterbalance these sweep- ing powers, there were few restraints. Congress, evidently with that haunt- ing Gestapo specter in mind, did specify that CIA should have no ar- rest or subpoena powers within the United States. The FBI's files, while not barred to it, were not exactly opened either; for, while other agen- cies were required to report their in- telligence findings to CIA, the FBI was not. The CIA may obtain what- ever specific information the FBI has if it requests it in writing, but this is quite a different affair from being kept informed as a matter of routine of what the FBI knows. Fi /1 AAA Ao, 4~i llOl/ up around those all-important "other functions and duties" the CIA was empowered to perform. These were to be embarked upon only at the di- rection of the National Security Council, presided over by the Pres- ident himself. But, as Ransom points out, the principal intelligence ad- viser of the NSC is the director of CIA. The director is "a constant par- ticipant in NSC deliberations," and this, to Ransom, seems "to suggest that the scope of CIA operations is to a large extent self-determined.... Certainly Congress has no voice as to how and where CIA is to function, other than prohibiting it to engage in domestic security activities." This is the powerful and secretive setup-doubly powerful and insidi- ous in its influence because it is so secretive, so free of any effective checkrein-that Congress created to protect us against the possibility of an atomic Pearl Harbor. How has it functioned? In the beginning, as was perhaps inevitable with a new agency, its performance could be described only as decidedly spotty. Rear Admiral Roscoe H. Hillenkoetter was the first director of CIA and guided its des- tiny through its first three difficult years. The Korean War came during this period, and with it came the first blunders of the new agency in its primary role, the gathering of intelligence. Early Failures For some of these errors in stra- tegic foresight, CIA was not alone at fault; other older and better- established arms of the intelligence services, the military and the State Department, were equally culpable. The first miscalculation-and one of the gravest in magnitude, for upon its accuracy rested the cornerstone of such deterrent policies as "massive Russia might be expected to deto- nate an atom bomb. All intelligence services agreed at the end of World War II that this feat would require ten years at least, and all were aston- ished when the Soviets held their first successful A-bomb test in 1949. This shock was succeeded by one even greater, for the Russians in Au- gust, 1953, actually beat us to the first workable hydrogen bomb, and we learned some significant details of value to ourselves by analyzing their fallout. With these blasts, just as important though less obvious and less publicized than Sputnik, "mas- sive retaliation" became an unwork- able two-way street. The next flub involved Korea, but again, at the outset at least, CIA was no more at fault than others. All our intelligence services thought it highly improbable that the North Korean Communists would invade South Korea and touch off a war- but they did. This first wrong guess was followed by others. One of the great surprises was the appearance in the Korean skies of the Russian MIG-15, a war plane faster than any- thing in our arsenal and one that in- flicted crushing losses on our B-29 bombers. Yet, even after the MIG-15 appeared, we continued our fatal underestimation of the Russians. Air Force Intelligence was of the opin- ion-and the other intelligence serv- ices seemed to agree-that the Rus- sians could turn out no more than six MI.Gs a month by hand; actually, Russian industry built 10,000 MIGs with.great rapidity. These initial blunders of intelli- gence in the Korean War were mat- ters of relatively little moment com- pared to the final one that, in the fall of 1950, literally cost the lives of thousands of American soldiers. United Nations forces, having recov- pally, a suppose Apsparoledr or92e~easetlto~eal&lAWDP6$06F1~00U1 i~pitial defeats, had 546 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R0001003000.61-5 driven the Red invaders from the late summer of 1950. His pulse-tak- North back across the 38th Parallel, ings convinced him that, if our troops the dividing line between North and crossed the 38th Parallel, the Com- South Korea. A decision had to be made whether to continue the at- tack across the border, conquering all of Korea. This course was sub- ject to one paramount danger. If U.N. forces pressed on into North Korea, would the Chinese Commu- nists, with their hordes of manpower, enter the war? General Douglas MacArthur was confident that they would not. All of our intelligence forces agreed in es- sence on this forecast. In this,,as in the recent Cuba invasion, our vision appears to have been blinded by our desires, and the intelligence for which we pay literally billions of dol- lars was abysmally wrong, while the advice of independent' observers, whose minds were not chained by the demands of policy, was plainly right. In the Korean War, as in the case of Cuba, there were many clear and explicit warnings that a blind intelligence refused to heed. One of these was delivered by Su- preme Court Justice William O. Douglas. An astute world traveler, Justice Douglas had been roaming through Southeast Asia during the munist Chinese would enter t e war on a massive scale. He personally warned President Truman of this. A similar warning was sounded in Washington by the Indian represent- atives to the United States. But these uncommitted minds could not be ex- pected to be so persuasive as those who were supposed to know. Ransom, in his work on the CIA, describes the sequel in these words: Despite the continuous barrage of propaganda warnings and the care- fully monitored movement of troops into Manchuria, intelligence analysts and the policy makers failed to con- sider seriously such threats and ap- parently neglected to read history, or they would have recognized the traditional Chinese fear of an enemy north of the narrow Korean waist. President Truman records in his memoirs that "On October 20 (1950), the CIA delivered a memorandum to me which said that they had reports that the Chinese Communists would move in far enough to safeguard the Suiho electric plant and other instal- lations along the Yalu River which provided them with power." Actually the Chinese had begun crossing the Yalu four days earlier with the ap- parent intention of throwing the United Nations forces out of Korea. The surprise was complete, and the massive Chinese onslaught threatened for a time to cut off and obliterate the U.N. Army. Even though MacArthur managed to res- cue the bulk of his forces, he was ,driven back' in a military debacle. Criticism of the CIA may have had something to do with the de- cision of Admiral Hillenk;oetter to leave his post as its director and re- turn to naval duty. He was succeed- ed by General Walter Bedell Smith, who had been Eisenhower's Chief of Staff in Europe. One of Smith's first moves was to telephone Allen Dulles. Dulles had served on a committee that in 1948 had examined the CIA setup and recommended some fifty administrative changes. Smith had read the report, and when he got Dulles on the phone in his New York law office, he spoke with char- acteristic bluntness. As Dulles later recalled it, Smith growled: "Now that you've written this damn report, it's up to you to put it into effect." Dulles agreed to serve with Smith. In November, 1950, he left for Wash- ington. Ile has been there ever since. PART V WITH DULLES IN IRAN "I CAME DOWN here to stay six months, and now see what has hap- pened," Allen Dulles remarked to a friend some years ago, in a happier time. A husky six-footer, weighing 200 pounds, the boss of the CIA, with his bristling mustache and thinning gray hair, greatly resembles his late brother, John Foster Dulles, but in Washington he was generally the much better liked of the two. He was less of a Messiah, more relaxed, more good-humored. A man who seems to live with a pipe in his mouth, Allen Dulles looks more like a kindly, tweedy, college professor than a mastermind of secret intelligence, and he and his wife form one of Wash- ington's most popular party-going couples. They frequently, however, do little more than put in an appear- ance and leave early. But even these fleeting visits cause some eyebrow raising, for most comparable com manders of secret agents, less gre- garious than Dulles, shun the cock- tail circuit with its built-in tempta- tions to wag the tongue. This is a risk that Dulles assumes with ap- parent joyousness, and this much must be said for him: he has never yet been accused of dropping the wrong word into the wrong ear. As far as personality goes, then, (and, as everyone knows, it goes far), Allen Dulles has been and still is a popular man in Washington. At sixty-eight, he is still amazingly ac- tive. He plays a good game of dou- bles in tennis, still shoots golf at around ninety when he has a chance to play, Friends describe him as a man of "enormous patience," and to interviewers-he presents the candid and attractive face of a man who modestly deprecates his own cloak- and-dagger roles. "I've never been shot at," he remarked once, "and I don't know that anyone ever tried to kidnap me." These engaging personal attributes have helped to carry Allen Dulles far and probably have helped to blunt much sharp criticism to which, other- wise, he might have been subjected. He became Deputy Director of CIA under Bedell`Smith in August, 1951, and in January, 1953, with the ad- vent of the Eisenhower administra- tion, he was named director even as his brother became Secretary of State. Thus, as The New York Times June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 L 54? Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 noted at the time, the nation in a most unusual move had placed "in the hands of two brothers the direc- tion of open and secret foreign policy designed to win the `cold war' against communism." The result became evident almost at once. Not just intelligence, but palace coups became the work of CIA. The intrigue that topples gov- ernments became increasingly its trade mark. Dulles had hardly made himself comfortable in the CIA director's chair when a major event abroad called for prompt and accurate anal- ysis. In March, 1953, the report of Joseph Stalin's death flashed over the wires to a teletype in CIA head- quarters at 2430 E Street N.W. in Washin_Mton. The dictator's demise raised immediate and tremendous questions. Georgi Malenkov appear- ed to be the No. 2 man in the Krem- lin. He would probably succeed, for a time at least, to Stalin's power. What kind of ruler would he be? Would Russia be torn by revolution, by internal power struggles? Would she be more, or less, warlike? Upon the answers to these ques- tions depended America's posture, America's preparation to meet the changed world situation. CIA swung at once into a "crash" program de- signed to provide the necessary in- formation. The instant Dulles got the word of Stalin's death, he began sending out orders to CIA agents and undercover men scattered through- out the world. He demanded from them information on what to expect, morale behind the iron curtain, arms shipments, troop movements, purges. Before long, detailed reports began to pour in. Iran: a Tangled Web While the foreign network was supplying overseas data, Dulles and the experts in his analysis section in CIA headquarters sifted reports and studied their voluminous files on Malenkov and the men most closely associated with him. From all of these sources, they compiled a pic- ture and made an expert guess. A messenger rushed off to the White House with this CIA estimate: Rus- sia was not prepared for war. There would be no revolution. It was, as events were to show, a tiohalism in Iran, and he capitaliaed pretty accurate assessment, and it 11- on the sentiment of the hour by ex- lustrates CIA's functioning at its propriating the properties of the best in the intelligence field that British-owned Anglo-Iranian Oil Co. should be its primary business. But The company's royalty payments before many months had passed, CIA had provided a major part of Iran's was to give another demonstration foreign exchange earnings; but with of its prowess, this time on a differ- the seizure by Mossadegh, there de- ent and far more controversial level, veloped a bitter international dis- The development involved strate- Pete. The huge financial interests of gically important, oil-rich Iran. The the West virtually boycotted Iranian Iranian border runs for 1,000 miles oil. Mossadegh tried to make deals along that of the Soviet Union, and the natural resources of the country include an estimated 13 per cent of the world's oil reserves. This liquid treasure, the one great source of true wealth in Iran, long had been ex- ploited by British interests. Baron Reuter, founder of the British news service that still bears his name, had received in 1872 a concession that gave him practically a complete mo- nopoly over Iranian industry. Inter- national complications prevented Reuter from doing much to exercise the concession for several years, but ultimately, in the early 1900s, he and others-including J. Henry Schroe- der & Co., the international German banking house with which Allen Dul- les later was to be connected-form- ed the Industrial Bank of Persia (later the Bank of Iran), which in turn helped to finance the Anglo- Iranian Oil Co. It seems worthy of note that Frank C. Tiarks, one of Allen Dulles' fellow directors in the ,Schroeder banking enterprises, served also as a director of Anglo-Iranian Oil and that Sullivan and Cromwell, the New York legal firm in which the Dulles brothers were such prom- inent partners, was the long-time legal counsel of Anglo-Iranian Oil. These old ties are stressed because they were lying there among the stage props in the background when Allen Dulles, just a few short months after he became CIA director, pop- ped upon the international scene in a new and decidedly spectacular role. The immediate background was this: In 1951, a new political force that threatened old and dominant finan- cial interests had arisen in Iran. This force was Mohammed Mossadegh, himself a wealthy landowner, but a man driven by a strong anti-British phobia. Mossadegh rose to power as Premier during a time of intense na- with smaller, independent American companies to work the Iranian fields, but the State Department frowned upon such free enterprise. The inter- .national oil cartel held firm-..-and Iran lost all its oil revenues. Democracy-and Oil The resulting financial pressures on the Mossadegh regime were enor- mous. The United States offset some of these with foreign aid. In 1951, $1.6 million was allowed for a tech- nical rural-improvement program. The following year, with Iran drain- ed of all oil revenue, the American foreign aid grant was raised to $23 million, most of which was used to make up Iran's foreign exchange shortages. The Iranian financial crisis, however, remained desperate, and on May 28, 1953, Mossadegh sent a demand to President Eisen- hower. Iran, he said, would have to have more American aid, or he would have to seek help elsewhere through the conclusion of an economic agree- ment and mutual defense pact with Russia. Foreign analysts were convinced that Mossadegh had just one asset he could pledge to guarantee the safety of Russian investment-the rich Iranian oil fields and the re- finery at .Abadan, the world's largest, which Mossadegh had seized from Anglo-Iranian. It is clear that Anglo- Iranian had billion-dollar prop- erty interests at stake, but this un- derlying factor has hardly ever been mentioned in discussing the loftier picture - the stake of democracy: If Russia were to get Iran's oil, the Western democracies' position throughout the Middle East would be weakened, Soviet prestige would be greatly enhanced. This, naturally, was unthinkable, and so the Eisen- hower administration, already great- Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 ly under the influence of the Dulles brothers, decided on a startling new gamble in international intrigue. The President stalled Mossadegh for a month, then turned him down with an emphatic "No." Immediate- ly afterwards, things began to hap- pen. The step-by-step action was de- tailed by Richard and Gladys Harkness in a three-part Saturday Evening Post series, "The Mysterious Doings of CIA," which appeared in the late fall of 1954. The series bears intrinsic evidence on almost every page of having been written with the full, if secret, cooperation of CIA, and so its account of the coup in Iran is as authoritative as one can get. Obviously, this was one of those occasions when Allen Dulles, in tri- umph, permitted himself an audible public chuckle-and a discreet leak. Enter the CIA This, then, according to the Hark- nesses, is what happened: On August 10, 1953, Allen Dulles packed his bags and flew to Europe, ostensibly to join his wife for a quiet vacation in the Swiss Alps. His de- parture coincided almost precisely with mounting developments in the Iranian pressure-cooker. Mossadegh was threatening to run Shah Mo- hammed Riza Pahlevi right off the throne and out of the country. The Premier had allied himself with the Communist Tudeh Party in Teheran and had acquired almost dictatorial powers. He was at this very moment conferring with a Russian diplomatic- economic mission. These conferences were a clear sign that the hour of supreme decision approached; yet, strangely enough, Loy Henderson, the American Ambassador to Iran, seemed to feel free to leave his vital post for a short "holiday" in the company of Allen Dulles in Switzer- land. Another visitor who seemed to be drawn as if by a magnet to Dul- les' picturesque hostelry in the Alps at precisely this critical juncture was Princess Ashraf, the attractive and strong-willed brunette twin sister of the Shah, who, according to the Harknesses, "had had a stormy ses- sion with her brother in his pink- marble palace, because of his vacil- lation in facing up to Mossadegh." The Alpine rendezvous of master secret agent, diplomat and Iranian princess would seem to indicate that perhaps wires were being pulled. This suspicion . was reinforced when. a fourth mysterious actor began to stroll slowly across the international stage. This was Brig. Gen. H. Nor- man Schwarzkopf, best known for the not entirely brilliant conduct of the Lindbergh kidnaping case in 1932 when he had been head of New Jersey State Police. Schwarzkopf now began to move leisurely around the Middle East, stopping off in Pakis- tan, Syria, Lebanon-and Iran. He was an -old hand in Iran, having served there from 1942 through 1948 as high-level adviser in the reorgani- zation of the Shah's national police force. He was, he said, just dropping by "to see old friends again." Mossa- degh and the Russian propaganda, press distrusted this pat explanation and began to rail nervously at his presence; but Schwarzkopf, undeter- red, visited with the Shah and had some intimate talks with his former colleague on the national police force, Maj. Gen. Fazlollah Zahedi. Almost at once, like cause' and effect, a new and tougher attitude toward Mossa- degh became apparent. Triumph for the West On Thursday, August 13, the Shah acted. By royal decree he deposed Mossadegh as Premier and installed in his stead General Zahedi. A colonel of the Imperial Guards was sent to serve the notice on Mossadegh, but Mossadegh wasn't ready to quit. He massed tanks, jeeps and troops around his residence, and at mid- night of Saturday, August 15, he seized the colonel of the Imperial Guards, clapped him in jail and pro- claimed that the "revolt" had been crushed. The Shah and his Queen, taking Mossadegh at his word, promptly fled to Rome by way of Iraq. Some hardier souls, including Schwarzkopf, remained upon the Iranian scene. The manipulations in which they now engaged never have been spelled out in detail, but it is understood that CIA cash flowed in copious quantities. The amount re- liably reported is $19 million-and $19 million can influence a lot of men. What happened next in Iran would seem like proof of that theorem. On Wednesday, August 19, with the Army standing close guard around the uneasy capital [the Harknesses wrote], a grotesque procession made its way along the street leading to the heart of Teheran. There were tumblers turning handsprings, weight- lifters twirling iron bars and wrestlers flexing their biceps. As spectators grew in number, the bizarre assort- ment of performers began shouting pro-Shah slogans in unison. The crowd took up the chant and there, after one precarious moment, the balance of psychology swung against Mossa- degh. Upon signal, it seemed, Army forces on the Shah's side began an attack. The fighting lasted a bitter nine hours. By nightfall, following American-style military strategy and logistics, loyalist troops drove Mossadegh's elements into a tight cordon around the Pre- mier's palace. They surrendered, and Mossadegh -was captured as he lay weeping in his bed, clad in striped silk pajamas. In Rome, a bewildered young Shah prepared to fly home and install Zahedi as Premier, and to give Iran a pro-Western regime. Triumph for our side! In the Hark- ness account, there is of course no hint of the years-long legal tie be- tween the Dulles brothers and Anglo- Iranian 011, nor is it emphasized that one of the major accomplishments of the coup in Iran was to save the bil- lion-dollar scalp of Anglo-Iranian. The picture presented, obviously the CIA's flattering version of itself, was June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 542 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 that the overthrow of Mossadegh had been accomplished "by the Iranians themselves" and that Iran was the showcase of a new method by which CIA would develop and nurture "freedom legions among cap- tive or threatened people who stand ready to take personal risks for their own liberty." This sounds fine if one doesn't analyze it too closely, but the hard sequel of events, unfortunately, has refused to reflect the lofty image. In the harsh a-fterlight, it has become abundantly apparent that all CIA accomplished in Iran was an old- style palace coup, with money in bountiful quantities and skillful press agentry pulling emotional heartstrings at a pivotal moment and achieving a much-desired end. But did this represent a great triumph for Western democracy in the ideo- logical battle against communism? True, a new regime, oriented toward "our side," had been installed. But was this new regime motivated by any loftier concept than the idea that what was good for Anglo-Iranian Oil was good for Western democracy? Events seem to say that it was not. $5 Million a Month Much of the sorry story is told in the 1957 report of the Committee on Government Operations of the House of Representatives. The report makes clear that in August, 1953, immedi- ately after the overthrow of Mossa- degh, a delighted United States be- gan to pour mutual security funds into Iran at an average rate of $5 million a month and that this went on for three years "to make up def- icits in Iran's government budget." The committee found that, in five years from 1951 to 1956, the United States had donated a quarter of a billion dollars to Iran and that (the committee did not phrase it in pre- cisely these terms, of course) all we had accomplished was to furnish the entire Middle East with a king-size example of graft and corruption. The committee was convinced that Iran, with some $300 million a year fat- tening its treasury from restored oil revenues, should have been fully ca- pable of financing itself and provid- ing for its own national development without any U.S. aid. Yet, despite its heavy oil revenues, despite the hundreds of millions of dollars in American aid, Iran's CIA-installed government was so corrupt that the national treasury constantly teeter- ed on the brink of bankruptcy and reported ever-mounting deficits. No Triumph for the People Here are some of the exact words of the House committee. The quar- ter-billion dollars in American aid was administered in such "a loose, slipshod, and unbusinesslike manner" that "it is now impossible-with any accuracy-to tell what became of these funds." Amounts requested for American aid to Iran "seem to have been picked out of the air." The American aid mission to Iran was concerned only with spending as fast as possible regardless of what the money was spent for, and members who objected to this "were either disciplined or labeled as incompe- tent." Improvement projects were so riddled with graft and corruption that, after four years, most still were not finished. A major undertaking was the construction of a multi-mil- lion-dollar dam on the Karadj River, but this project "has resulted in vir- tually nothing but the relocation, at a cost to the United States Govern- ment of nearly $3 million, of a road around the proposed site." Not only had no construction been started on the dam, there wasn't even a con- tract! The effect of this type of Ameri- can aid has been to make a bad situa- tion worse. It is a hard thing to say, but true, that the American taxpay- ers have been milked of hundreds of millions of dollars only to provide the Communist system, on a gold- plated platter, with a priceless propa- ganda item. Our hundreds of millions of dollars have done virtually noth- ing for the people of Iran; they have enriched only the grafters and widen- ed the gulf between the very rich and the abysmally poor. The Con- gressional committee in 1957 found literacy so low in Iran that, even in the cities, some estimates placed it at not more than 7 per cent. Time, magazine, certainly not one of the world's ultra-liberal organs, report- ed in 1960 that some families were still living on the produce of a single walnut tree, that tiny children work- ed all day at the looms of rug fac- tories for 20 cents or less. Time, up- dating its report in May, 1961, found that Iran, under the pressure of the flood of American dollars, was suf- fering from runaway inflation. Prices were jumping at the rate of 10 per cent a year; a pound of meat in Teheran cost $1.15; wages remained so low that teachers were earning only $25 a month. The economy of the country was being strained to maintain a 200,000-man Army, larger than the armies of either Western Germany or Japan. Elections had been so blatantly rigged that the Shah had been forced to cancel two of them and fire three key men in his immediate entourage. One of these was the chief of the secret police, who had built himself an ostenta- tious mansion near the Shah's own palace; another was General Ali Kia, chief of army intelligence, who, said Time, had "built a block of luxury apartments that Teheranis had taken to calling the Where-Did-You-Get- It-From Building." This is what we have bought in Iran with our millions. The result we reap by such extravaganzas be- came clear this past May when 5,000 .teachers rioted in the streets of Te- heran in front of the Parliament building. A police major lost his head, fired his revolver and killed one teacher, wounded three others. Teachers and students then fought bloody hand-to-hand skirmishes with police, paraded the dead teacher's coffin through the streets and forced the resignation of the Premier. The Shah hastily installed Ali Arnini, a wealthy, French-educated landowner with liberal political views. Amini, Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 concededly the last hope of avoiding revolution, took over a nation so badly looted that its government debt, only $10 million in 1955, had soared to $500 million. He took swift stock of the situation and reported: "There is no life left in the economic and financial agencies of the govern- ment." To striking teachers, he con- fessed: "The treasury is empty, and the nation faces a crisis-I dare not speak more openly lest I create a panic." Yet some persons in Iran still were not worried. The commanders of its 200,000-man Army and its massive police force felt fully capable of handling anything and everything. Senator Hubert Humphrey (D., Minn.) reported with a sense of shock: "Do you know what the head of the Iranian Army told one of our people? He said the Army was in good shape, thanks to U.S. aid - it was now capable of coping with the civilian population. That Army isn't going to fight the Russians. It's plan- ning to fight the Iranian people." Such, in the final analysis, is what the CIA and the corrupt Iranian re- gime that followed in its coup-mak- ing footsteps have wrought in Iran. No demonstration of "decadent cap- italism" could be more apt, more pat for Khrushchev's propaganda pur- poses. Here, in most graphic form, is a demonstration of the manner in which, as Walter Lippmann found, we have been doing exactly what Khrushchev expects us to do; we have been propping up dictatorial, corrupt, right-wing regimes-and so we have been proving his case for him. It should be obvious that the American ideal, if it is ever to be persuasive, if it is ever to have va- lidity, must find loftier expression than the gun of the secret police chief clasped in fingers stained by many a dirty buck. It must concern itself with people, not with rulers; it must help the broad mass of the people; it must offer both freedom and hope, not oil profits and graft. PART Vi JUST A LITTLE REVOLUTION IN MARCH, 1954, Allen Dulles was interviewed by U.S. News and World Report on the cloak-and-dagger ac- tivities of CIA behind the iron cur- tain. The question-and-answer se- quence went like this: Q. It is often reported in the papers that you send in provocateurs to stir up revolution in the satellite coun- tries. What truth is there in that? Dulles: I only wish we had ac- complished all that the Soviets at- tribute to us. .. . Q. Is that part of your function- to stir up revolution in these coun- tries? Dulles: We would be foolish if we did not cooperate with - our friends abroad to help them do everything they can to expose and counter this Communist subversive movement. Tacitly, then, Dulles acknowledged that the CIA was fomenting violence and revolution behind the iron cur- tain, but he was putting it in the gentlest possible way and on the most acceptable possible plane. We were simply "cooperating" with our friends; we were simply helping them "to expose and counter this Com- munist subversive movement." It all seemed very mild and very logical the way Dulles put it, but revolution is never mild, nor is killing an appeal to logic. A little reflection about Dul- les' statement leads inevitably to serious questions. Is it all really so simple? Just what is involved in stirring up a little revolution behind the iron curtain? Do such brush fires simply flare and burn themselves out, causing the Russians some, well-de- served embarrassment, or do they in a very direct way involve the pres- tige and policy of the United States? The answer seems clear and un- equivocal to anyone who will study the record. It has been given in a number of places-in East Germany, in Poland, in Hungary, in the Mid- dle East. Behind many of the erup- tions that in recent years have shaken the peace of an uncertain world, close examination will reveal the fine, scheming hand of CIA. And it will reveal, too, that CIA time and again has stirred up the brush fires without any regard for the long- range consequences. East Germany, 1953 Take, for example, the East Ger- man uprising of 1953. On June 17, just two months before Allen Dulles' startling coup in Iran, a series of anti-Communist riots broke out in the Soviet-dominated East Zone. In America, this was taken as an en- couraging sign that all was not rosy in the communistic millennium and that perhaps the East Germans might throw off the yoke of tyranny. Such optimism was quickly dissi- pated. Though some of the anti- Communists were well-armed, the revolt was quickly put down; and though great numbers of refugees fled across the border into West Ger- many, not all of the leaders of the rebellion were so lucky. The Eastern SSD (State Security Service) began a reprisal campaign that lasted for months and resulted in the seizure of hundreds of Soviet-bating Ger- mans. The significance of this counter drive became apparent on November 17, 1953, when The New York Times reported that the East German Gov- ernment had accused scores of its prisoners with being Nazi provoca- teurs. The East Germans claimed (one must always regard these Com- munist claims with caution, of course, but then in the secret war of CIA one has no other information on which to judge) that these Western agents had been caught with plans to blast railroad bridges and stations, burn factories and government build- ings and assassinate officials. Faked food stamps and counterfeit bank drafts designed to upset food ration- ing and bank credits were found in some of the prisoners' pockets, the East Germans asserted. The Communists in the East Zone were incensed by these discoveries, but then presumably New Yorkers June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 50 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 would be a little annoyed if a squad of Russian saboteurs should be caught with plans to blow up the Croton reservoir. In any event, a number of the accused agents pro- vocateurs were brought to trial. Tes- timony showed, the East Germans said, that these agents belonged to a mysterious organization headed by Reinhold Gehlen, a former Lieuten- ant General in command of counter- intelligence on the Eastern front un- der Hitler. The East German trials resulted in the execution of four of these Gehlen agents and life impris- onment for eleven others, but not even these harsh sentences stirred up as much controversy as one other charge the East Germans made. They contended that, on some of the agents, they had found lists of names of prominent West German anti- Nazis who had been marked for ulti- mate liquidation. Though it would seem extremely illogical for East German saboteurs -co be carrying such lists around in their pockets, there can be no ques- tion that the East Germans, in jab- bing an accusing finger at the Rein.. hold Gehlen spy organization, touch- ed a sensitive nerve. Gehlen at the time was a mystery figure, virtually unknown to the 48 million citizens of the Bonn Republic; unknown to American Congressmen because his name had never been mentioned on the floor of Congress. Yet Gehlen and the private cloak-and-dagger army he headed were indisputably real. In fact, Gehlen was America's No. 1 spy in Europe, he had literal- ly thousands of agents on his payroll., and he was being financed to the tune of between $5 million and $6 million a year with CIA-channeled funds. Daniel De Luce, one of the Asso- ciated Press's veteran foreign corre- spondents, in an article written some months after the East German reve- lations, lifted a corner of the veil of secrecy that for so long had shrouded Gehlen. Geblen's organization, De Luce said, included the elite of the old German Army's counterintelli- delegated to this weird, recent-enemy organization major responsibility for its own thinking, knowledge and safety. The secret pro-German policy, which seems to have had many pow- erful advocates in the highest Amer- ican circles even during the horrors of World War II, had indeed brought its full-circle. Plots-anal More Plots Yet the American public as a whole remained almost completely unaware. Few major newspapers (the St. Louis Post-Dispatch was an ex- ception) paid any attention to De Luce's revealing dispatch from Ger- many. John Foster Dulles' much- trumpeted policy that we intended to liberate the captive peoples - advanced, as events were to show, without giving the most elementary consideration to how this desirable end was to be achieved short of all- out American aid and another world war-rolled like an avalanche down- hill to fresh international fiascoes that served only to increase interna- tional tensions. Time and again, with CIA in the middle of the plotting, aided frequently by its Gehlen pro- te,ges, futile revolts and short-sighted intervention marked the consistently reckless course of American foreign policy. Here, in capsule form, are some of the well-remembered highlights of the disastrous fifties that saw the whittling away, not just of American power, but of America's moral pres- tige: ?The overthrow of King Farouk in Egypt in 1952. Communists inside Egypt reportedly were making im- mense capital from the antics of the lascivious regime of the pudgy mon- arch whose principal interest in life appeared to be belly dancers. An Army revolt was organized with Generals Mohammed Naguib and Gamal Abdel Nasser in the leading roles. The Harknesses, in their Sat- urday Evening Post revelations, straight from the horse's mouth, stated flatly: "Skilled American po- litical operatives were available to advise leaders of a pro-American Egyptian military junta when the time seemed ripe for a palace coup, and they indicated how such devi- ous matters were best arranged." It know what another was doing, of tying all the threads together at just one place-the top. His thread-tying headquarters were located on Ameri- can-requisitioned property near Mu- nich in Bavaria, and were sealed off with barbed wire and guarded by armed state police like an atomic installation. "On his secret reports which eval- uate the findings of his costly anti- Soviet espionage program operating as far beyond the Iron Curtain as Siberia, much of American defense planning admittedly depends today," De Luce wrote. The picture that emerges borders on the fantastic. American knowl- edge and security were being made dependent, to a vital degree, on men who were our recent enemies-men who had fought to the last gasp for a system that we had believed rep- resented one of history's most mon- strous evils. It is certainly question- able enough to have American foreign policy tugged and hauled all over the map by the super-secret activities of CIA cloak-and-dagger boys, operating free of any effective restraint or control; but clearly, in its relations with Gehlen, CIA had taken one further gigantic stride in- to the realm of dubiousness. Without the knowledge or consent of the American people or their representa- tives, it had placed some $6 million worth of annual reliance in the good faith of a recent enemy, command- ing an unofficial army of foreign agents (many of them apparently former Nazis at that), and it had gence corps and agents of diverse o nationalities scattered through East- Q ern Europe and the Balkans. Gehlen t- i ld h ce serv secre e o operated on t principle of never letting one agent `SSZ Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5. The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 was 'another. gignll triumph for "our side." The coup came off on schedule, Farouk fled - and then we got Ga- mal Abdel'Nasser. The Egyptian strong man whom we had helped to install apparently long remained a favorite of CIA - such. a favorite, indeed, that in Sep- tember, 1955, a CIA agent took it upon himself to advise Nasser to ignore a forthcoming State Depart- ment note. The note was an attempt to limit Nasser's purchase of arms from Communist Czechoslovakia to a one-shot deal. It was considered important enough for Washington to send. George Allen, then Assistant Secretary of State for Middle East Affairs, out a special trip to Cairo to deliver the message in person. The CIA evidently was disturbed by this attempt to pressure Nasser, and be- fore Allen arrived, it effectively cut the ground out from under him by advising Nasser he could safely ignore the warning - a sequence that leads inevitably to the question: Who was running foreign policy, the State De- partment or the CIA? We Knew All A,1os g ?The Suet crisis in October, 1956. This alight be described as the final flowering of our earlier intrigues with Nasser, and even the most. charitable view must produce a blush or two: at what can only be described as Amer- ican duplicity. First, of course, we precipitated the crisis, by offering Nasser heavy financial aid and then practically slapping his face by re- neging on the offer. This touched off a chain reaction whose consequences would appear not to have been fore- seen. Nasser seized the Suez Canal. And the British, French and Israelis undertook the invasion of Egypt. When this happened, we held up our hands in righteous horror at the warlike action of our Allies and pro- tested that we had been taken com- pletely by surprise. John Foster Dul- les testified: "We had no advance in- formation of any kind [regarding the Israeli attack on Egypt]. The Brit-' ish-French participation also came as a complete surprise to us.". This simply was not true. Two years later, in 1958, the CIA leaked to Don Whitehead, of the New York Herald Tribune, a version so detailed that it leaves little doubt that we knew and knew precisely - just what was going to happen before it hap- pened. According to CIA, American intelligence agents in Israel had noted and reported the mobilization of the Israeli Army; agents on Cyprus had watched and reported British and French activity in loading combat craft and marshaling war planes and paratroopers; they had even reported that the French had given combat briefings to newspaper correspond- ents attached to their invasion units. Twenty-four hours before the attack, the White House had a specific warn- ing from CIA that the Israelis would invade Egypt, that the French and British would attack Suez. Bearing all this in.mind, let's listen to the insider's view contained in the letter written to The Nation by, an intelligence agent in 1957, a full year before Whitehead's disclosures: I know that ... Intelligence Serv- ice received information through vari- ous channels about the planned ac- tion. This. information was. duly transmitted to. the State Department. Mr. [John Foster] Dulles knew the day and hour of the attack. Under these circumstances' it was quite ob- vious that we should have dissuaded. our allies from such a rash step... . Those in the know were surprised by the behavior of our Secretary of State at the titiue. Mr. Dulles' reply to a comment froth a State Depart- ment official was that in our posi- tion, the best thing to do is to shut our eyes and see nothing. We shall win in any case. Both the defeat of the Arabs as well as the loss of pres- tige by the United Kingdom and France will benefit us. The moral prestige of the West in Arab coun- tries has suffered untold harm by the attack on Egypt. The case speaks for itself. Me invasion of Lebanon in 1958. If the. CIA was not, caught napping in the Suez crisis but was made to look bad for devious reasons of policy, there seems to be no question that it had not the slightest forewarning of the military coup by a group of pro-Nasser Army officers in Iraq on July 14, 1958. King Faisal and Premier Nuri es-Said, pro-Western rulers of Iraq, were slain.Simultane- ously, riots and insurrection shook the pro-Western government of Premier Chamoun in Lebanon. News of these events reached Allen Dulles about dawn on July 14. He promptly went into action. Ile got his brother, Secretary of State John Foster, out of bed, and he summoned the chair- man of the Joint Chiefs of Staff to an emergency conference. With both Dulles brothers urging drastic action, the panic button was pressed loud and long. The American Sixth Fleet was ordered to Lebanon; marines went charging ashore in a full-scale invasion. For a moment, world peace seemed to. hang in the balance. Yet, in the calm of retrospect, this "crisis" action seemed to have almost farci- cal aspects. Riots, a little gunfire, the coups that overthrow governments are no particular novelty to the Lebanese. They seemed to have had no understaunding, those simple?folk, that , the fate 'of the entire cold war depended upon events in Lebanon. Indeed, they regarded the landing of the marines more as an amusing and colorful sideshow; it was an event that turned an ordinary day into a fete day, and crowds lined the harbor front to. watch the fun. Needless to say, a powerful nation does not look well in the robes of a circus clown, and it was freely predicted at the time that the hasty and ill-advised invasion would boomerang against American prestige. It did just. that. Afro-Asian countries joined the So- viet Union in backing a United Na- tions resolution demanding that American troops get out of Lebanon; on October 31, the marines left-and Chamoun's government, which they had been sent to prop up, promptly fell. Chamoun remains bitter at the Americans, who, he feels, went back on promises they had made to him to support his regime at whatever cost. In the end, at great risk, we had pleased nobody; we had won our- selves another loss. CIA on the Danube ?The Hungarian revolt of 1956. The CIA's role in promoting and en- couraging this abortive and tragic uprising, which we were not prepared to support after we had instigated it, remains shrouded in top-level, cloak- and-dagger secrecy. It seems well established, however, that arms were smuggled into both Poland and Hun- gary, either by the CIA or its Gehlen collaborators. When the Polish and Hungarian rebellions broke out in guns 94a 4961 . Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 October, 1956, both American offi-? cial and public opinion appeared to be caught off base, and there were charges that CIA had been sleeping at the switch again. Not so, the agency said in self-defense. It had accurately predicted the outbreaks in both Poland and Hungary; its only error, a minor one, had consisted in. estimating that the Polish revolt: would come first. More important: than the unresolved issues of arms-, smuggling and CIA alertness is still. another unresolved matter-the re- sponsibility of CIA in whipping up the Hungarian rebels to fanatic self- sacrifice in a hopeless cause. Al-. though the fact ;cannot, of course, be verified, it has been charged that Radio Free Europe works closely with CIA. RFE's propaganda broadcasts during the bloody Hungarian revolt prolonged the struggle after it was hopeless and led to needless sacrifice, according to Leslie Bain, Budapest: correspondent for The Reporter. "America will not fail you ... Amer-, ica will not fail you," he quoted the propaganda radio as repeating over and over, after it had become appar-? ent to all the rest of the world that America would. The ruthless sup-, pression of the Hungarian revolt by Soviet tanks and troops was certain-. ly a grim chapter that served to strip off before the eyes of the world. the mask of Russian false preten- sions. But let's not forget that Amer- ican luster was tarnished, too. We had been exposed as a nation that talked big, but that had no plan; we had been exposed as a nation that had let those who trusted in our words go down to death, prison and disillusionment. Classic Meddling Such is the record of some of the CIA's more classic meddling in the internal affairs of Europe and the Middle East. It shows that even the agency's successes (as in the case of Farouk) have a ,tendency to turn into long-run disasters, and it indi- cates strongly that America is hard.. IN, qualified, by anti-communistic en-? thusiasm alone, to run the internal affairs of other nations all over the world. The record in these cases, such as it is, has been written; but there remains in CIA's behind-the-scenes masterminding of European affairs one large item of-unfinished business that may be more important than all the rest-its long-term, enduring re- lationship with the Gehlen secret service and the possible influence of that relationship in coloring our of- ficial attitudes toward such vital is- sues as Berlin and the equipment of the German Army with nuclear arms. Clearly these are matters on which the peace of the world ultimately may hinge, and so it seems pertinent to inquire: Just who is this man Reinhold Gehlen to whom, largely without the knowledge of the Amer- ican people or the American Con- gress, we so swiftly and so complete- ly entrusted our safety after the end of World War II? Herr Reinhold Gehlen Gehlen is a product of the German Reichswehr, a life-long professional soldier and, according to official as- surances at least, no Nazi. A smallish, thin-faced man, he has a high fore- head, receding fair hair and light blue eyes. The son of a publisher, he is quiet and scholarly in manner, but he speaks in the terse, clipped tones of a man long accustomed to com- mand. He Joined the Reichswehr in 1920; he fought in the invasions of Poland and France; and when the Russian war broke out, he was trans- ferred to the Eastern Front where, in April, 1942, he was selected to head the German Army's key new intel- ligence section. He quickly became convinced that the Soviet Union could not be over- whelmed by military means alone, and he was, De Luce says, "one of the lost voices that urged the Nazi regime . . . to win over the Russian people by generosity while rooting out the Communist system." Instead, some two million Soviet war prison- ers were reduced to sub-human mis- ery in Nazi extermination camps. The official recital of Gehlen's vir- tues continues by stressing the pessimistic accuracy with which he forecast events on the Eastern Front. His grim view of the war, it is said, almost earned him execution as a dangerous defeatist, but recurrent disasters so consistently fulfilled his dire predictions that he wound up being promoted to Lieutenant Gen- eral at the age of forty-three. With the collapse of the Hitler re- gime, Gehlen saw to it that he got captured by the Americans. Here there appears to be a significant gap in the story. There is no hint of the nature of the contacts or negotia- tions that preceded his surrender, but one is confronted, out of the blue as it were, with the picture of a pris- oner of war being treated from the start almost like a Very Important Personage. Gehlen, we are told, brought with him an imposing mass of secret information on Russia, and this presumably was a direct pass- port to American good graces. In any event, he was employed for eighteen months combing through his own voluminous files and putting them in order for American intelli- gence. Then he was rewarded with as juicy an assignment as a war prisoner ever got; he was given au- tonomous command of his own army of private agents, with, as De Luce wrote, "a personally chosen German staff to organize cold-war espionage in the Soviet Zone for the United States." De Luce continued: "Gehlcn's pri- mary mission is to identify and locate at all times the forward Soviet and satellite armed forces. This is funda- mental to allied security, including 400,000 American, British and French troops outposting West Ger- many." The British Are Shocked Though the American public even today remains almost totally un- aware of what we did or of its pos- sible significance, our relations with Gehlen long have represented one of the most controversial aspects of out secret cold-war policies. Quite ob- viously, our whole attitude toward Germany, toward France and Britain, toward all of Europe, must have been conditioned by what for long years we were told-or not told-by the multi-million-dollar espionage ring of former German agents whom we had made our principal eyes and ears in Europe. This pivotal trust on such crucial matters has shocked our closest allies, the British, who do not play the game of intelligence that way; and since the past record would seem to indicate they play it pretty well, it is perhaps of some signifi- cance to trace further the career and the influence of Reinhold Gehlen. W Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATloN Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The Affair of Otto John It must have been clear from the start that Gehlen's private army would have a highly equivocal status inside West Germany, where official security matters were in the hands of Dr. Otto John. All signs indicate that a fine, throat-cutting duel was waged between Gehlen and John, with Gehlen doing his best to get Chancellor Konrad Adenauer on his side. He and Adenauer held a num- ber of secret meetings in a house across the Rhine River from Bonn, and Dr. John, who later revealed these assignations; apparently was perfectly aware that the ground was being cut from under him. CIA os- tensibly was working closely with John's security forces, but its money in multi-million-dollar amounts was riding on Gehlen. The private strug- gle between the two West German security chiefs came to a head in early July, 1954, when Dr. John visited the United States. He went to Washington and had lunch with Allen Dulles. Outwardly, the two men gave every appearance of cor- diality, but no one knows what went on between them, for on this matter CIA has never peeped a word. Dr. John returned to Bonn, and then on July 20, 1954, came an event that rattled official eyeteeth. Dr. John deserted to the Communists in East Germany, presumably taking with him a privately hoarded store of valuable state secrets. This turncoat performance by master was an embarrassing episode, but it could hardly have broken the heart of Gehlen. He was left with a clear field-almost. One other poten- tial rival, Friedrich Wilhelm Heinz, who headed the intelligence section of the Defense Ministry in Bonn, re- mained in the.running, but he quick- ly proved no match for Gehlen. The result was reported in The New York Tines on July 20, 1955, in a dispatch from Bonn. The German Govern- ment had just announced that it had decided to take over Gehlen's organi- zation, then estimated to include 3,000 agents. The Timer credited re- ports that "the main stream of East European information received by the United States Central Intelli- gence Agency originates with the Gehlen organization." Of Gehlen, it commented that he was inaccessible and "something of a legendary fig- ure." The Times added: "He has been credited by some with great in- telligence and denounced by others as a sinister figure." Just a few months later, on Sept. 1, 1955, the name of the mysterious Gehlen figured startlingly, if only momentarily, in an unusual upheaval in American intelligence. The Army announced in Washington that Maj. Gen. Arthur Gilbert Trudeau, who had headed the Army's G-2 (Intel- ligence Corps), was being transferred to a Far East post. The announce- ment was made to appear routine, but John O'Donnell of the New York Daily News apparently was fed an earful by irate Pentagon brass. For O'Donnell disclosed that Trudeau's scalp had been demanded by Allen Dulles personally. According to O'Donnell, Dulles spelled out his case in a letter to the Secretary of De- fense, and the feud was carried all the way to President Eisenhower himself for final decision. In Dulles' official letter, O'Donnell wrote, the CIA head . charged that the Army's top in- telligence officer, "without consulting the Central Intelligence Agency," had talked with West Germany's Chancel- lor Adenauer here last June in "an effort" to "undermine" the confidence of Adenauer in a hush-hush CIA- bankrolled setup in Germany, headed by the mysterious Reinhart von [sic] Gehlen. Furthermore, said Dulles, the the reliability of Gehlen as an in- dividual and the security safeguards of the mystery organization. The Pentagon denied quite vocif- erously that Trudeau, one of its fa- vorite generals, the commander who had spearheaded MacArthur's drive to recapture Manila at the end of World War II, had ever committed such a breach of protocol as. to ques- tion Gehlen's reliability. All lie had done,. said the Pentagon, was to ex- press some doubts about Gehlen's se- curity safeguards. Whatever the truth about the extent of Trudeau's criticism, the bare bones of the case boil down, it would seem, quite' sig- nificantly to this. Reinhold Gehlen, just ten years earlier the master of Hitler's intelligence on the Eastern Front, had sufficient influence through Allen Dulles to cost even the Army's G-2 chief his post. Our German Ally Against this background, let's turn once more for an insider's view to the intelligence officer who wrote The Nation in 1957. His at least is not the conventional, official view, and un- der the circumstances, it may seem worth serious thought. He wrote: Our Intelligence Service in West Germany collected much reliable in- telligence which should have led the State Department to reconsider its point of view on Dr. Adenauer's policy. Americans serving in Fontaine- bleau and in West Germany are very much aware that the Germans under the guise of "friendship" are only in- tent on recovering their military might by using the United States as a springboard. Contacts with German military and other officials have con- vinced me that the Germans hate and despise Americans. They cannot forget that the United States was their enemy in the Second World War. Adenauer's assertion of friend- ship serves as a smoke screen which enables West Germany to mark time. Eventually Germany will spurn Amer- ican tutelage and proceed with her own ambitious plans. These plans, i.e., annexation of East Germany, res- toration of eastern borders, etc., can be achieved only by a world war. The United States may find that in- stead of using Germany for its own purposes it would be bound to a German policy. . . . West Germany's official intelligence General has expressed doubts about The Germans are indeed playing Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 June 24, 1961 X55 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 the game their own way, nurturing plans for the future. This is corrobo- rated by the fact that Gehlen's In- telligence Service in West Germany frequently conceals important intel- ligence and deliberately issues mis- leading information, regardless of our agreement for exchange of infor- mation. Nevertheless, during this postwar period, Gehlen has been con- sidered a most loyal ally and his Service has been financed with Amer- ican dollars. Communist propaganda refers to Adenauer's West Germany as a pup- pet of the United States. We prefer to regard her as our most "reliable" ally. Both conceptions are wrong. Germany is our "most dangerous" ally. Our friendship with her may have disastrous consequences for the United States. Under these circumstances, our preference of West Germany over our old and tried allies is unpardonable. British and French officers have often expressed themselves in my presence with an obvious feeling of resentment and bitterness over the United States policy of making yesterday's enemies today's principal partners. With this attitude, Edwards, the British Labour M.P. and skeptic of German intentions, fully agrees. In his pamphlet on Allen Dulles, he has written: It is particularly worrying that Mr. Dulles and his agency should be maintaining close contacts with Gen- eral Reinhold Gehlen's West German secret service. Though it can be count- ed as a NATO intelligence organiza- tion, we think there is great need for caution in our dealings with it. It is extremely unlikely that General Geh- len has any very warm feelings for us. As for Mr. Dulles, he actually advertises his friendship with the General and after a recent visit to London went straight off to Bonn. But we have reason to believe that General Gehlen does not confine his interests to the East. The German secret service never has done so. So much the worse for us. . . . Beware the Germans, when they come bear- ing gifts! An extreme view, possibly, but valuable for all of that as a caution, a warning, a reminder that there is another side to the German question. We are never told that any more, but then we have never been told about Reinhold Gehlen and his or- ganization either-or about how we got where we are. PART rail THE ROAD TO WAR ONE OF THE most significant in- formal conferences of the postwar era was held in Allen Dulles' CIA office on a cold and dreary morning in March, 1952. His brother, John Fos- ter, had just returned from the Far East, where he had added to his prestige by helping the Truman ad- ministration draft the Japanese peace treaty. John Foster was now about to become one of the most caustic critics of the administration that had employed him. He was full of, very positive ideas about exactly what should be done to right the situation in the world. Participating in this conference that was to forecast much of the global strategy of the Eisenhower ad- ministration before Eisenhower had even been nominated or elected were a number of important second-eche- lon officials-Allen Dulles, then the No. 2 man in CIA; Charles Bohlen, State Department Counselor; John Allison, then Assistant Secretary of State for the Far East; General Mer- rill, of Merrill's Marauders fame; John Ferguson and C. Burton Mar- shall, of the State Department Plan- ning Staff. John Foster Dulles opened the con- ference by expounding his views- and quite positive views they were. He sharply criticized Truman's order interposing the Seventh Fleet be- tween Formosa and mainland China. This, John Foster said, was really "protecting" the Chinese Commu- nists, then battling us in Korea, from counterattack by the Nationalist forces of Chiang Kai-shek. He had discussed this "anomalous" situation with Chiang, he said, and Chiang, as was hardly surprising, fully agreed with him. Now, there were "certain islands" close to the mainland still held by Chiang's warriors, and Chiang, if given a "warrant" by the United States to insure him against the risks involved, could strengthen his already considerable forces on the islands and play merry hob with the Communists on the mainland. This, John Foster said positively, is what we should do: we should in effect, though be did not use the precise term, "unleash" Chiang; we should adopt a bold "forward" policy against the Chinese aggressors. According to Stewart Alsop, who six years later revealed the details of this meeting in his Saturday Eve- ning Post article, "The Story Behind Quemoy: How We Drifted Close to War," John Foster Dulles' proposal was received at first with tepid po- liteness. Allen Dulles asked a couple of deferential questions. Nobody seemed to challenge John Foster's thesis until suddenly C. B. Marshall, "a big, articulate, irascible man," blew his top. The course Dulles pro- posed, he said flatly, would mean di- rect American intervention in the Chinese civil war. Worse, if we gave Chiang a "warrant" on the offshore islands, we would by this action "con- vey to a foreign entity the power to involve the United States in war." Marshall denounced Chiang's "men- dicant and necessitous regime" and branded any "warrant" that would permit such a regime to drag the United States into war "an act of supreme folly." John Foster Dulles [Alsop wrote] looked at Marshall as though he did not exist-a feat Dulles can perform brilliantly-and said not a word. There was an unhappy silence. Then Bohlen, the able diplomat, took over, asking Dulles questions which were politely phrased, but which neverthe- less pointed up the risks involved in the course Dulles proposed. The meeting then broke up, on a strained and inconclusive note. The islands under discussion were, W. I Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 of course, Quemoy and Matsu, hud- dling almost on the doorstep of the Chinese mainland. Small, rocky nub- bins of land, they were of absolutely no strategic value, as such eminent authorities as Dwight D. Eisenhow- er and Douglas MacArthur agreed; yet twice in succeeding years, due to the "supreme folly" of Dulles' policy, they almost dragged the United States into war, almost touched off the third world conflagration which everyone so dreads. .Islands of Folly For John Foster Dulles wasn't to be deterred from his "bold forward" plan by the logical objections of men like Marshall and Bohlen. Almost as soon as he became Secretary of State, he loudly proclaimed what the news- papers dubbed the "unleashing" of Chiang. He did not go quite so far as to give Chiang a public "warrant," but the effect was the same. With our active encouragement, Chiang poured thousands more troops into the offshore islands, creating a situa- tion in which he could claim that he had committed the very flower of his Army there and so, when trouble arose, we were committed to sup- port him. The situation has over- tones reminiscent of those in Ger- many where, as the letter-writing intelligence agent remarked, we are so wedded to German policy that, if the Germans ever determine to re- unite their country, we almost cer- tainly will be dragged into war to help them. In the Far East, time and again, a tinder-box situation has been cre- ated by the fatuity of the American obsession with Chiang Kai-shek. Powerful American business inter- ests, in alliance with many of the power lords who dominate the larger media of information, long have per- sisted in viewing Chiang as one of the great men of his age, a states- man of nobility and stature, a leader who may one day win back China ,.from the Communists if we only give him our help. This view has been so widely sold to the American people that it is considered virtually an act of treason in many circles to chal- lenge it. Yet challenged it must be. The record is clear and explicit, and it isn't at all what we have deluded our- selves into believing. Chiang has never been anything but a Chinese warlord with one guiding principle -the interests of Chiang. In his rise to power, he played footsie with the Communists, and not until he had won and wanted the big apple all for himself -did he really break with them. The corruptness of his re- gime was one of the least-hushed World War II scandals. It offered the people of China nothing; American Army leaders in China found it al- most impossible 'to get Chiang's "tigers" to fight, and the Japanese Chiang Kai-shek almost tore the country apart while Chiang and his inner circle waxed fat on the resources of the national treasury. As William J. Lederer writes in A Nation of Sheep, the Chi- yiese people became "sick of him and the Soongs" and "the rotten Chinese apple was ready to drop of its own accord." Although. Chiang had bil- lions of dollars' worth of American military equipment for his 3-million- man Army, these forces were com- posed of conscripts who had no love for Chiang; money for its food and pay went into the pockets of grafting officers. And so, when Communists applied pressure, the troops didn't fight-they either surrendered or joined up. Chiang fled to Formosa, taking the contents of the national treasury with him. For ten years now, Chiang's Formosan regime has been painted in the United States in glowing col- ors as a Western-style democracy. Actually, nothing could be further from the truth. As Lederer writes, Chiang's warriors, when they first arrived, "pillaged and robbed For- mosa." They killed thousands of pro- testing Formosans with machine-gun fire; and ever since, having taught the Formosans a democratic lesson by this process, Chiang's 2 million Chinese Nationalists have ruled some 9 million Formosans with an iron, dictatorial hand. According to Lederer, some 70 per cent of Chiang's Army is now composed of Formosan conscripts, who might fight to pro- tect their home island but have no burning compulsion to help Chiang reconquer China. The Formosans themselves would like to be rid of the Nationalist monkey on their backs; and they have no love for the United States, which continues to prop up Chiang's discredited regime with some three-quarters of a billion dollars in annual aid.. Yet America's arch right-wing policy makers and its equally arch right-wing CIA under Allen Dulles continue to invest Chiang with a halo and to push him forward as our answer to communism in Asia. It is an infatuation that has brought us repeatedly into widespread disre- pute. Poppy Fields of Burma Consider the case of Chiang's Bur- mese opium growers. In 1951, follow- ing the collapse of Chiang's regime on the 'mainland, several thousands of his followers fled across the Yun- nan border into Northern Burma. American policy makers decided to arm and equip these Nationalist troops for a reinvasion of Yunnan Province. From Formosa, CIA al- legedly masterminded the operation. Arms, munitions, supplies were air- lifted into Burma, but despite this support, there is little evidence that Chiang's gallant warriors ever wreak- ed much damage on the Chinese Reds. Instead, the Nationalists dis- covered they could achieve the finer life more easily by growing opium, and a great number of them settled down in Northern Burma and pro- ceeded to do just that. The Burmese, a most unreasonable people, were not happy with this June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 557 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 ideal, CIA-created situation. For some inexplicable reason, they seem- ed to resent the presence of this for- eign army on their soil; and when Chiang's fighters, showing no regard for Burmese sovereignty, practically took over the state of Kengtung and established their own government, the Burmese actually filed a vigorous protest with the United States. As Charles Edmundson, former Wash- ington editor of Fortune and a for- mer foreign service expert, wrote in The Nation (Nov. 7, 1957), the American Ambassador in Burma hadn't been let in on the secret of what the CIA and the Chinese Na- tionalists were up to. The Ambassa- dor, William J. Sebald, therefore denied in perfect good faith that America had anything. to do with supporting Chiang's guerrillas in Burma. Burmese Prime Minister. U Nu.knew better .and became so in- censed he suspended all U.S. Point Four activities and almost broke off relations entirely. Eventually, our own Ambassador resigned his, post in. protest against our own program, and American prestige throughout Southeast Asia sported a couple of very unlovely black eyes. A four-power conference finally reached an agreement about Chiang's opium-happy warriors. Some 7,000 were evacuated to Formosa. But even this didn't solve the entire problem. Sizable remnants of the Nationalist force continued to squat in their poppy fields, and as of this spring the Burmese Army was still fighting a guerrilla war in its own country in an effort to wipe them out. In this most recent fighting, the Burmese contended they had seized American arms and supplies only recently air- lifted into Burma. Such charges, skillfully exploited by Communist propaganda, sparked riots that re- sulted in the stoning and wrecking of U.S. Embassy buildings in down- town Rangoon. When such outbreaks occur, the widespread impression given the American people in glaring headlines is that we have been most foully attacked again as a result of Communist machinations; hardly ever is there any appreciation of the fact that the Communists might find it impossible to get the people on their side without the help of the backfiring plots of our own cloak- and-dagger boys. The "Spooks" of the Islands Destructive as such incidents are to America's image, they do not men- ace the peace of the world like the more grandiose CIA endeavors that led directly to the crises of Quemoy and Matsu. In the early 1950s, the CIA established on Formosa an out- fit known as Western Enterprises, Inc. This was a thinly disguised "cover" for CIA, whose agents, an in- communicative lot, became known on the island as "the spooks." These "spooks" played an active role in the build-up of Chiang's forces on the off- shore islands and the raids that were launched from there. As Stewart Alsop wrote, the CIA was "respon- sible for organizing and equipping the Nationalist guerrillas who raided the mainland from the offshore is- lands." These "commando-type guer- rilla raids" were "sometimes mounted in battalion strength," Alsop related. In addition, the offshore islands were used for reconnaissance, leaflet drop- ping, occasional bombing forays, and for blockading such Chinese ports as Amoy, on the mainland opposite Quemoy. These offensive gestures apparent- ly nettled the Chinese Reds, a very unreasonable and touchy folk, and in the first week of September, 1954, they became so incensed that they blasted Quemoy with heavy artillery barrages. Two American officers of the Military Advisory Group station- ed on the island were killed, and the American public, in its shock at such unprovoked aggression, was whipped up to the point where it might very easily have plunged into Chiang's war. In fact, Alsop wrote that "al- though no more than a tiny handful of people knew it at the time, the close to responding with a condi- tional decision to go to war with Red China." Alsop cited chapter and verse of the story. The Joint Chiefs of Staff, under the leadership of that old strong-China hand, Admiral Arthur Radford, voted overwhelmingly for war. They backed a policy, not just to launch bombing raids on military objectives opposite Quemoy, but to blast targets far inland in China. If the Chinese Reds responded with an all-out attack on Quemoy, we would use nuclear weapons. This, make no mistake about it, would have been World War III. Only Matthew Ridgway dissented and fought with all his power against such an "unwarranted and tragic course." Ridgway found an ally in Gen. Walter Bedell Smith, who had been moved over from CIA and made Under Secretary of State when the Dulleses took charge. Smith shared Ridgway's horror of the prospect and telephoned his former chief, Presi- dent Eisenhower, then vacationing in.Denver. Eisenhower listened and scotched the reckless plan of the Joint Chiefs. The 1954 crisis, given a chance, finally died down, and the policy known as the "releashing" of Chiang began. Until 1954, Alsop wrote, the offshore islands had been almost the "exclusive playground" of CIA; but, by the time of the first Quemoy crisis, CIA's thin "cover'.' of Western Enterprises, Inc. had been pretty well "blown" and control had been turned over. largely to the Military Advisory Group. The presence of these uniformed military advisers on the islands represented, in effect, the public "warrant" John Foster Dulles had originally proposed we give Chiang; and when, in 1958, the Com- munist Chinese again shelled the is- lands, our prestige once more was on the line, and once more we were al- most involved in war. Only a broad promise that we wouldn't permit Chiang to use the islands for any worth-while purpose, not even leaflet dropping, smoothed over the situa- tion. And Now Laos The Burmese crisis that all but turned friend into foe, the recurrent crises on Quemoy and Matsu, vividly illustrate the manner in which the secret and militant activities of CIA create for us a foreign policy all their own. They illustrate the way the CIA tail wags the American dog and how such wagging can quite easily plunge the whole animal-and all his breth- ren-into the most horrible of his- tory's wars. But Burma and Quemoy weren't the only examples in Asia The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 of what is wrought by CIA. To these there must be added another exam- ple, and one of current crisis signifi- cance-Laos. American blunders in Laos go back a full six years, and they are not by any means all of CIA's making, though it was reserved for CIA to write the final, climactic chapter. To understand how CIA masterminded us into. the hole in which we now find ourselves, one has to appreciate the background. Laos became a na- tion in 1955 as a result of the Geneva agreement that split the former French Indo-China into its compo- nent parts. Laos was the interior principality, primitive, landlocked, with a 1,000-mile border with Red China. The Geneva agreement pro- vided it was to have a neutralist gov- ernment, but the evidence is abun- dant that we, no more than the Com- munists, wanted a neutral Laos. We wanted a Laos committed irrevo- cably to our side. This becomes clear if one studies the findings of the House Commit- tee on Government Operations which delved deeply into the Laotian mud- dle in 1958 and, on June 15, 1959, filed a scathing report of what it found. What the committee discov- ered was that all sound military ad- vice had been disregarded by the State Department in.its determina- tion to build up an anti-Communist Laos. The committee remarked acidly that Congress had always been as- sured that "force objectives"-the number of foreign troops the United ,States will support-are established on the basis of the military judgment of the Joint Chiefs of Staff. In Laos this simply was not true. The Joint Chiefs, in fact, consid- ered Laos militarily worthless and repeatedly told the Eisenhower ad- ministration so. The House commit- tee wrote: "U.S. support of a 25,000- man Army, of the entire military budget, and of segments of the civil- ian economy is, in fact, based on a political determination made by the Department of State contrary to the recommendations of the Joint Chiefs of Staff." It pointed out that the Joint Chiefs, even after they had been asked to ,reconsider their views, had refused to budge. In a memo- randum, they had said, the House committee wrote, that "mutual se- curity support of Laotian forces could not be recommended `from the military point of view,' but acqui- esced in the provision of such sup- port `should political considerations be overriding.' " This, then, was the beginning. The House committee's findings make it clear that, for political considerations alone, we imposed upon Laos a huge and militarily unjustified standing .Army. We did this with no regard for either the characteristics or the desires of the Laotian people. The Laotians are Buddhists; they are, not in pretense but in actuality, a deeply peaceful people. As Keyes Beech wrote in the April 22, 1961, Saturday Evening Post: "In Laos not even the fighting cocks are blood- thirsty. They wear no spurs and do not fight to kill. As good Buddhists, Laotian soldiers were no less reluc- tant. They generally aimed high and expected the other fellow to return the favor." The Cocktail Circuit In Laos, as in so many other of the world's trouble spots, the right- wingers in our own State Depart- ment and CIA dealt only with their right-wing counterparts, a small and wealthy ruling class and this class's military cohorts. As Newsweek re- ported last May: "Our allies, the tra- ditional ruling class, had little in- terest in reform. The political meth- ods they used-stuffing ballot boxes and intimidating neutralist voters- succeeded only in driving the mod- erates to the Left. . . . The worst thing perhaps was that U.S. policy makers never came to terms with any elements in Laos other than those they considered to be militantly anti- Communist." Tied to such interests, with view- point constricted to the cocktail cir- cuits of Vientiane, we plunged head- long into Laos, apparently with no philosophy except that if we spent enough money, no matter how, we could buy ourselves an anti-Com- munist ally. As the House commit- tee found, we repeated, on an even more flagrant scale, all the ghastly mistakes which it had criticized so strongly years previously in Iran. Laos is about 99 per cent agricul- tural. Its economy is primitive. The Laotian farmer usually grows what he needs, barters off his surplus to supply his other wants. Money, in much of Laos, is virtually nonexist- ent. Into such an economy, with evidently no regard for its disrup- tive effects, the United States in just six years poured $310 million. The result was almost inevitable. The wildest currency speculation took place; the Laotian economy was all but wrecked; and the cost of living doubled between 1953 and 1958. Cooperative Graft As in Iran, corruption flourished like jungle growth in the tropics. The House committee found clear evidence that both the Americans who were channeling the aid dollars to Laos, and the Laotian government officials who were dispensing them, dipped greedy paws into the golden stream. The committee flatly ac- cused one American public-works of- ficer of accepting "bribes totaling at least $13,000." It recounted the sor- did story of a former U.S. Operations Mission Director who extracted a fantastic price for his decrepit 1947 Cadillac from an official of the Uni- versal Construction Co., to, whom lie was awarding a contract. "Un- controverted evidence," the commit- tee wrote, "indicates that the vehicle was at that time inoperable, and that shortly thereafter it was cut up and the pieces dropped down an abandoned well. In the interim, it had stood rusting in front. of Uni- versal's main office, where it was the subject of scornful amusement by Laotians and Americans alike." One honest American who tried to do something about the mess was "railroaded out of Laos by his su- periors." The railroading was sanc- tioned by Ambassador J. Graham Parsons, who presided over our aid efforts in Laos at their corrupt worst, and Parsons was rewarded for his watchfulness by being called back to Washington and made. Assistant Secretary of State for Far Eastern Affairs. In all of this time, the bulk of the American taxpayers' $310 mil- lion was used mainly to enrich an inner circle of palace thieves; hardly any of it was used to help the Lao- tian people. Not until the elections June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 559 Approved For Release 2004/03/26 CIA-RDP64B00346R000100300061-5 of 1958 were imminent did the Amer- icans distributing aid in Laos sud- denly come up with a crash program that they labeled "Operation Boost- er Shot" to try to buy some good will on the mass level. In one acid paragraph, the House committee summed up the operation- al mess: The concentration of the benefits of the aid program to the area around Vientiane and other centers of popu- lation, and the enrichment of, and speculation by, Lao merchants and public officials which attended the aid program, tended to lend credence to the Communist allegation that the Royal Lao Government was "corrupt" and "indifferent" to the needs of the people. The Pea)ple's Voice Even an idiot, it might be pre- sumed, should have foreseen the in- evitable consequences, but our CIA and our State Department remained blind to them right up to the last moment of inescapable truth. Ex- Ambassador Parsons was testifying before the House committee just as the Laotian elections were being held in 1958. He insisted that be had re- liable, "official" information that the results would be wonderful for our side. The Communist Pathet Lao, he predicted, would win only two of fiftee ; contested seats, and this would mean that "the integrity and independence of Laos in the free world" would have been preserved intact. Then the votes were counted. The Communists, instead of being crush- ed, won a crushing victory. The House committee later reported that the Communists had won nine seats, and their sympathizers an additional four. The Royal Cabinet, indeed, had to install the pro-Red leader as the minister who, in the future, would control U.S. Foreign Aid Funds in Laos; it had to agree that, henceforth, two battalions of pro- Communist troops actually would be supported by U.S. funds. This was victory? This was assuring "the in- tegrity and independence of Laos in the free world"? In obvious disgust, the House com- mittee wrote: In summary. the accision to sup- port a 25,000-man Army---motivated by a Department of State desire to promote political stability-seems to have been the foundation for a series of developments which detract from that stability. . . . The aid program has not prevented the spread of communism. in Laos. In fact, the Communist victory in last year's election, based on the slogans of "Government corruption" and "Government indifference" might lead one to conclude that the U.S. aid program has contributed to an atmosphere in which the ordinary people of Laos question the value of friendship with the Unitt:d States. When You Can't Buy- It might, indeed. But what the House committee found wasn't the last, or the worst, of the debacle. The final chapter, an epic. in blindness and futility, was yet to be written. For the simple truth is that, having failed to buy ourselves an ally in Laos, we next tried to procure one through the CIA's favorite device- the military coup. Allen Dulles' eager beavers engineered this with cavalier disregard of any superior strategy of the State Department or the desires of the new American Am- bassador on the scene, Horace H. Smith. Keyes Beech in his Saturday Evening Post account describes the conflict between CIA and Smith in these words: On the political level, Smith's job wasn't made any easier by the fact that during most of his tour in Laos he was being crossed by Central In- telligence Agency operatives nesting in his own embassy. As Smith saw it the question was: Who was going to administer American policy in Laos-CIA or the embassy? How many CIA agents were wandering around Laos during this period only the CIA could know. One of the more flamboyant, who blossomed everywhere, affected a copybook cover that included a manufactured British accent, a luxu- riant mustache, elaborately casual but expensive clothes, and a cane with a secret compartment that held -not a sword, but brandy... . As Ambassador, Smith favored a conservative coalition government which offered a little of something to all factions. CIA activists made no secret of their preference for a group of army "Young Turks." CIA's favorite boy was Gen. Phou- ml Nosavan, the forty-one-year-old Minister of Defense, who was later to emerge as the government "strong man." Phoumi was strongly anti- Communist. He was also fervently pro-Minister of Defense,. because that's where the money was... . . . The first blowup came in August, 1960, when a paratroop captain named Kong Le, whose troops hadn't been paid in three months because his superiors were looting the till, became fed up with the state of af- fairs and led a coup. Successful, he raced all around Vientiane in a jeep bearing legends 'demanding the Amer- icans go home. The CIA boys and the brains of the American military mission on the scene were stunned. Until Kong Le suddenly went off the deep 'end, they had considered hire one of their very own fair-haired boys, and they couldn't understand what the devil had gotten into him. Nor did they like or understand any better what Kong Le did with his newv-found power. Neutraliser: a Dirty Word He called on Prince Souvanna Phouma to take over as Premier. Souvanna was a neutralist. Depend- ing on how you look at it, he was a sincere neutralist, hoping to bring sortie kind of peace to his unsettled country, or he was just a weak-kneed tool of the Communists. The Amer- icans, to most of whom neutralism. was a dirty word anyway, took the second view. Ex-Ambassador Par- sons, by this time promoted to the post of supreme authority for Far 560 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 7'he NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Eastern Affairs, flew to Laos to try to get some understanding with Sou- vanna; but he and Souvanna had never wasted any affection on each other when Parsons was Ambassador, and so it was almost inevitable that they wouldn't achieve any meeting of minds now. They didn't. The American chips went down on the CIA's boy, General Phoumi. Given the green light, Phoumi in Decem- ber, 1960, actually fought a battle and captured Vientiane. Souvanna and Kong Le were chased out, and having no place else to go, they join- ed the Communist Pathet Lao. With him in retreat, Kong Le thought- fully took 9,000 American rifles with which he armed the Communist forces. Premature Celebration In Vientiane, General Phoumi and the CIA celebrated their victory. "The celebration. was premature," Keyes Beech writes.,."Looked at from a cold-blooded, cold-war viewpoint, the bloodshed might have been jus- tified if, as the CIA argued, blood- shed was necessary to `polarize'Com- munist and anti-Communist factions. It might have. been justified if strong and effective leadership had emerged from the smoke of battle. Unfortu- nately, neither of these things hap- pened.`Polarization' took place only at the top, between the same tired, familiar faces." Souvanna and Kong Le, backed now by Communist manpower, be- gan to carve up Laos. Phoumi, hav- ing distributed the best financial plums in the government among his relatives, seemed to have lost all in- terest in the dreary business of fight- ing. Everywhere the Pathet Lao forces were victorious. The puppet government we had installed was too corrupt and inefficient to oppose them; the 25,000-man Army for which we had been paying for five years had never wanted to fight in General Phoumi the first place and wanted to fight even less in . a corrupt cause; the Laotian people whom we had not helped, but had only helped to ruin, could hardly be expected to feel that we were worthy of their ultimate sac- rifice. So there we were, having made one of history's most colossal botches of everything. The new Kennedy Administration was bequeathed this little' sweet- heart of a problem. There the Coin-_ munists were, overrunning all of PART, VIII FIASCO IN CUBA IN DECEMBER, 1960, U.S. Sena- tor-elect Claiborne Pell (D., R.I.) made a quiet visit to Fidel Castro's Cuba. A former Foreign Service of- ficer in World War II, Senator Pell was no novice in pulse-taking, and when he went among the Cuban people, he was surprised at what he found. He later capsuled his dis- coverics for the New York Herald Tribune in these words: The people of Cuba that I saw June 24, 1961 and spoke to during three or four days of quiet observation were not sullen or unhappy or dissatisfied. I am afraid that it is only true that they were still tasting the satisfac- tion of Castro's land reform, of his nationalization of United States com- panies and of the other much-touted reforms put into effect by Castro. The dispossessed and disgruntled were in jail or in exile. Senator. Pell returned to Washing- ton and explicitly warned high of- northern Laos, gobbling up another country, and we were faced with just two unlovely choices. We could either go to war in defense of freedom against the Communist menace, or we could humbly sue for the reinsti- tution of the very kind of neutralist government (only it would be worse now because the Communists were stronger) that we had conspired to kick out. Boxed into this dead-end street, President Kennedy, at first talked tough and acted as if he would like to fight. But it quickly became ap- parent that the Congressional lead- ership of his own party would have no part of such folly, and the result was the only result really possible- long-drawn-out, largely futile nego- tiations for a cease-fire in Laos and the return of "neutralism," even if it meant the return of Souvanna. No defeat that CIA has ever earn- ed us has been more complete, more devastating. In face-conscious South- east Asia, we had lost all' the face there was to lose, and even Thai- land, long considered a staunch part- ner of the West, began to flirt with neutralist ideas. In such manner had CIA intriguing come home to roost. As Marquis Childs wrote from Geneva, where he was dancing at- tendance on the Laos peace talks, if CIA was to be thoroughly investi- gated in the aftermath of Cuba, "the role played by that agency in the mess in Laos is perhaps more relevant than the share of responsibility which CIA must bear for the Cuban fiasco." ficials of the Kennedy Administra- tion that the time for action against Castro was not yet. During the same December, two other visitors to Cuba saw the same sights, came to the same conclusions, and wrote an article about them. These observers were Gen. Hugh B. Hester, U.S.A. (Ret.), holder of the Distinguished Service Medal for serv- ices in the southwest Pacific in World War II, and Jesse Gordon, Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 public-relations consultant. In an ar- ticle, "A New Look at Cuba-The Challenge to Kennedy," published by New World Review, General Hester and Gordon wrote: It must be pointed out that a Princeton poll, taken [in Cuba] last year, revealed 86 per cent of the people in support of Castro.... Most observers would agree that if elections were held tomorrow, Castro would be overwhelmingly re- turned to power.... The morale of Cuban workers and the militia is high.... There is no doubt about the peo- ple's spirit or their courage, tenacity and determination to hold onto the gains under the revolution.... The U. S. military high command has plans for an invasion of Cuba. Should the Kennedy Administration decide to continue along the reckless path of the previous Administration, we fear disaster will result. No prophecy was ever better jus- tified by the event. No prophecy was ever less hidden under a bushel. At the end of March, Gordon per- sonally mailed reprints of the article to the White House, the State De- partment and members of Congress. But about 1:30 A.M. on Monday, April 17, some 1,500 Cuban exiles- trained, financed and masterminded by the CIA-stormed ashore at the Bay of Pigs on Cuba's south coast. The CIA, the agency that is sup- posed to know all, had insisted that Cuba was ripe for revolution. Never perhaps was an intelligence estimate more disastrously wrong. In a few hours, it became apparent that the Cuban invaders had not the slightest chance. They were over- whelmed, killed, captured. The CIA- planned coup, almost a year in the making, backfired so tragically that Fidel Castro was presented with an hour of triumph in which to strut. Instead of being overthrown, the power of his regime, thanks to CIA, was solidified in all of Cuba. Commenting on the consequences almost a month later, Richard H. Rovere wrote: The passage of time does not re- duce the magnitude of the folly in Cuba. The more it is examined, the worse the whole affair looks. The immediate consequences are bad enough: Castro's tightened grip on Cuba, the growing distrust of Ameri- 562 can leadership, the revelations of Central Intelligence "operating" pro- cedures and of the bureau's mam- moth incompetence. What is more painful, though, is the awareness that intelligence (as a quality of mind, not as data), and the best staff a twentieth-century President has had, offered so little protection against enormous error.... As it turned out, the non-profes- sionals were mostly right, and the professionals were almost wholly wrong. This, needless to say, is not the result that an annual $1 billion in- vestment in intelligence is expected to achieve-especially on an island just ninety miles from our shores, an island on which we have a huge naval base, where there are many long-time American residents, where presumably we should have the most solid contacts. This wasn't Laos, thousands of miles away in another and remote corner of the world- but Cuba, on our doorstep. Operatives on Parade How could it happen? How could our master intelligence agency, CIA, be so completely wrong? These ques- tions have been only partly answer- ed, but even the partial answers throw the book at CIA. Let's look at one eyewitness account of the CIA in action. It was written by Thayer Waldo in the San Francisco Chroni- cle. This reporter [Waldo wrote] spent the first half of last year in Cuba. At that time, with the U. S. Embassy still in operation and fully staffed, eight of its personnel were CIA agents, three worked for the FBI, and each of the Armed Services had from one to five operatives assigned to intelligence work. No special effort was required to learn these facts or to identify the individuals so engaged. Within thirty days of arrival in Havana, their names and agency affiliations were made known to me, without solicitation, by other correspondents or Embassy employees. The latter included one. CIA man who volunteered the identities of all three persons accredited to the FBI; and a Cuban receptionist, outspoken- ly pro-Castro, who ticked off the names of six CIA agents-with en- tire accuracy, a later check con- firmed. In addition to Embassy staffers, the CIA had a number of operatives (I knew fourteen, but am satisfied there were more) among the large colony of resident U. S. businessmen. One of these, a roofing and installa- tion contractor, had lived in Cuba from the age of six, except for service with the Army during World War II-as a master sergeant in G-2, mili- tary intelligence. Predictably, that known background made the man a prime target for observation by Castro's people when IT. S: Cuban relations began to deteriorate seri- ously. He was shadowed day and night, his every contact reported. Yet the CIA made him its chief civilian agent in Havana. Unintelligent Intelligence Quite obviously, this wasn't a very efficient way for a super-intelligence agency to run a secret intelligence network. But then, according to Waldo, Naval Intelligence was no more efficient. During most of 1960 and into 1961, it ran a major in- telligence-gathering project at the Guantanamo Bay Naval Base. Some 3,800 Cubans are employed on the base, but they live outside govern- ment property, most of them in or near Guantanamo City, twenty- seven miles north. It occurred to Naval Intelligence that here, among these Cubans going back and forth every day, was a mass of raw human material from which could be culled significant data about the prevailing mood in Cuba. Naval Intelligence, as a result, ran about 140 interviews a day, questioning the Cuban work- ers about the attitudes of Cuban civilians toward Castro. Almost to a man, apparently, the workers as- sured the Americans that the Cuban people were with Castro. very, very unhappy Waldo points out that naval-base workers are paid about 60 per cent more than comparable workers in private industry, that the suffering Cuban economy offers few job op- portunities to any man who might lose the naval-base plum he had-- that, in a word, it should have been expected the Cuban workers would tell 'Naval Intelligence only what they knew Naval Intelligence wanted to hear. Waldo quotes a South American diplomat making this. wry comment on this strange intelligence The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 "operation: '"If I denounce my'ncigli- bor as my mortal enemy and then ask my servants their opinion, they are pretty apt to tell me that every- one else hates him, too-particularly if they like their jobs." From. such sources and from CIA's close contacts with emigre Cubans (who were convinced, naturally, like all emigres, that. great numbers of the Cuban people hated Castro as fervently as they did), American opinions appear to have been form- ed. It is necessary to use such qualify- ing words as "appear" and "seem," for it must be emphasized that any synthesis of, the Cuba misadventure must be based on incomplete infor- mation-the kind that has become available by sweeping out from un- der official rugs. Up to this point, the American people have been given no chance to find out for themselves what hap- pened, what went wrong, who was responsible. Investigations have been held in secret, as if we were safe- guarding the formula of some new miracle weapon; and when the Chair- man of the Joint Chiefs of Staff testifies behind closed doors, one Senator shouts that he has been shocked out of his britches and all the chiefs should be fired-others insist blandly that they weren't shocked, and nobody should be fired. Such are the baffling cross-currents in the world of secrecy we have substituted for the world of infor- mation. If, therefore, any officials would quarrel with this account of the Cuban fiasco, let them first quarrel with themselves - behind closed doors. Beginning of the Plot It seems, then, to be. well-establish- ed that in the spring of 1960, prob- ably in late April or early May, the Eisenhower administration made a fateful decision. Castro, it felt, was moving steadily into the Communist orbit. CIA had information that some eighty Cuban fliers had been sent to Czechoslovakia to train on Rus- sian jets; there .were reports of con- struction projects inside Cuba that looked to CIA as if they might be designed to launch missiles. Castro, in addition, seemed to be stirring tip trouble in Panama, the Domini- can Republic, Haiti; lie would' have to go. The strongest initial proponent of the "Castro must go" line appears to have been Republican Vice Presi- dent Richard M. Nixon. He, it is said, argued strongly that we must support armed intervention in Cuba to get rid of Castro, and he finally won Eisenhower's consent. Once this basic decision had been made, our fate was in the hands of CIA, for CIA was supposed to know precisely how to run such delicate affairs. This official misconception of CIA's omniscience and omnipotence .quite obviously was based upon CIA's vaunted successes in over- throwing Mossadegh in Iran and Ar- benz in Guatemala. Castro, we de- cided, was to be another Arbenz, and the Guatemala script that had worked so well was the one CIA elected to follow. In some ways, the situation seemed made to order for it. Castro's increasingly iron dictator- ship, his merciless execution of dissi- dents were sending increasing hordes of refugees to our shores. The Miami area was swarming with them. All that CIA had to do was to train them, arm them and mold them into an invasion force. Gaggle of Factions Simple as this basic conception seemed, it required considerable do- ing. The anti-Castro Cubans were a gaggle of warring factions, ranging over all the hues of the political spectrum. They included brutal ex- cops who had served Fulgencio Ba- tista without a qualm, arch conserv- atives who wanted, their lands and money back, left=wing reformers who wanted to preserve Castro's land policy and Castro's nationalization of vital industry, but without Cas- tro's dictatorship. These groups were personalized in their leadership. On the far Right were ex-Batista hench- men like Rolando Masferrer. Also far over to the Right; but free of the Batista taint, was the Movement for Revolutionary Recovery (MRR), headed by Captain Manuel Artime, who had been only briefly associated with Castro. On the Left-reformers, but strongly anti-Communist - were the followers of the People's' Revolutionary Movement (MRP), headed by Manolo Antonio Ray, Castro's former Minister of Public Works. The CIA, with its. pronounced right-wing proclivities which always seem to orientate it toward ruling shahs and military dictators, had to pick "its boys" from this divided pack; and its choice fell, where its choices always have seemed to fall, on the representatives of the Right. Only in this case its choice was more `unfortunate even than usual, for in Cuba the forces of the Right were almost powerless, to help it. The Choice that Wasn't Made Virtually all sources seem to agree that there was just one effective resistance movement inside Cuba: the MRP headed by Manolo An- tonio Ray. A quiet, soft-spoken 'ar- chitect and civil engineer, Ray had been one of Castro's most effective resistance leaders. For some two years during the precarious course of the Castro revolution, he had di- rected sabotage inside Havana; and when Castro came to power, Ray had been rewarded by appointment as Minister of Public Works. He served just eight months, then he broke with Castro. He realized by that time, he says, that Castro did not intend to live up to his demo- cratic promises, that his regime was becoming increasingly dictatorial, in- creasingly communistic. So Ray once more went underground, setting up his own clandestine organization to fight the new dictatorship. He managed to evade Castro's police and to work for eight months inside Cuba. In that time, he per- fected an underground network that spanned the island state. Each province had its seven-man execu- tive council, and in each province similar organizations reached down into the separate counties. Ray kept contacts between these underground groups to a. minimum, tying the threads together only at the top, and soon the effectiveness of his grow- ing organization was demonstrated by increasing incidents of sabotage. Ray was certainly an effective leader, not much doubt about that. But, let's whisper it, he was "left- wing." The man still had faith in the original Castro program; he J4wke?22,4961 Approved for Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 563, Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 thought that land - and. industrial reforms were long overdue and es- sential to Cuba's ultimate prosper- ity. Those who want Cuba returned to its pre-Castro state seem to over- look the vital fact that this state was so bad it made Castro possible. Castro clambered to power over the ruins of a corrupt and brutal system. Ile had made great capital (see his program as he himself explained it in The Nation, Nov. 30, 1957) out of the fact that 85 per cent of Cuba's small-scale farmers did not own their land; out of the fact that more than half of the arable land in the nation was in foreign hands; out of the fact that more than 200,000 rural families had not a square foot of land on which to support themselves while almost 10 million acres "of un- touched arable land remain in the hands of powerful interests." One of Castro's first and most popular acts had been to split up these baronial holdings. Ray believed that these objectives had been right, but he wanted them achieved in a frame- work of freedom. He explained his philosophy to the New York Post in these words: Our movement doesn't allow poli- ticians to come in on the backs of the people just so they can get back into power and get money for them- selves. [Ray did not explain how he would prevent this.] We've had enough of that. What we want is a continuation of social reform-not a government by the rich or the ex- ploiters. We believe in a mixed economy of private enterprise-be- cause it is effective and efficient- and government ownership of utili- ties and monopolies-because these things belong to the whole people. And there must be freedom. This, Castro has destroyed. Such a program could not fail to be anathema to rigid, right-wing minds, or to those powerful Amer- ican interests whose primary con- cern was the repossession of their vast, Castro-sequestered holdings in Cuba. With such a program, CIA would have no truck. Though Ray's underground organization was the only effective one, he had to go it alone. He got virtually no money, no supplies, no help of any kind from CIA. He established his own training camps and financed them by . selling one-peso stamps each month to sympathizers inside Cuba. Indicative of the support he had in- side the country we were trying to liberate was the fact that his collec- tions ultimately reached 60,000 pesos a month. CIA evidently drew no conclusions from this. All the time Ray was struggling to maintain him- self and his underground organiza- tion, CIA was pouring a huge flow of cash (the total finally came to $45 million) into the promotion of its right-wing invasion. Prying Open the Plot Over-all direction of the Cuban endeavor was in the hands of one of CIA's deputy directors, Richard Richard M. Bissell, Jr. M. Bissell, Jr., a former economics instructor at Yale. Under Bissell was a large corps of CIA agents and in- structors, some Spanish-speaking North Americans, at least one Fili- pino, and - surprisingly - quite a number of Eastern Europeans who couldn't communicate with their Cuban proteges at all except through interpreters. This was the staff that directed the training of the invasion troops in a number of camps carved out of the Guatemalan jungle. The first recruits, thirty-two in number, were flown to Guatemala in May, 1960. They were put to work hack- ing out a training base on jungle acres. donated for the purpose by Robert Alejos, a wealthy Guatemalan landlord.. Later airstrips were built on wasteland along the fringes of Alejos' coffee plantation, and Ameri- can jet pilots, in civilian clothes, were sent to train the Cuban fliers. ' All of this activity was conducted for months without anyone in the United States outside of the highest official circles having any inkling of what was afoot. But a large-scale invasion cannot be kept hidden from public view forever, and in this case, in any event, secrecy arrangements were not of the best. Some of the Guatemalan airstrips were operated in full sight of travelers on the Pan American highway and the Guate- malan railroad, and in time the word began to get around. The Nation called public attention to what was going on last November, but the large wire services and major media of information continued to play blind, deaf and dumb for nearly two months. It was not until early Janu- ary that Time finally used a short article on the Guatemalan airstrips, followed within a few days by a much more detailed story in The New York Times. With these news pieces, the American public at large, for the first time and still only in a tentative fashion, began to acquire information about the plot we were brewing in the Caribbean. Picking the Leader The publication of these first news stories almost coincided with a de- velopment of major importance in the Guatemalan camps. There CIA had picked its "fair-haired boy": twenty-nine-year-old Manuel Artime, regarded by some of Ray's followers as a Franco Falangist. By January, 1961, Artime was in solid with Frank Bender, the CIA area chief in Guate- mala. Drew Pearson asserts that Ar- time was helped along the path to rank and glory by Bender's secretary, Macho Barker, whom Artime had promised to make sports czar of liberated Cuba. If true, this report would seem to indicate that Artime expected to dominate the govern- ment of the new Cuba and to pass out the rewards. There are some other tenuous indications pointing in the same direction. The Chat- tanooga Times Washington corres- pondent, Charles Bartlett, later was to reveal the existence of a super- secret unit, known as Operation 40, apparently organized to act after the ,564 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 invasion, seizing' control of the new government and establishing a dic- tatorship, possibly under Artime. With these machinations stirring in the background,. the youthful Ar- time made his move at the end of January. With the full backing of CIA, he staged a coup in the train- ing camps. He made fiery speeches to some 1,500 freedom fighters then in training. In some instances, he changed their commanders, installing his own men, and he appealed to all to join his banner. Most did, but some 200 balked. Those "Democratic" Rebels Artime didn't stand for any. non- sense from these recalcitrants. Back- ed up by CIA all the way, he. had the 200 arrested and isolated under guard. Some managed to escape through the jungles and make their way. back across Mexico to Miami. Others were talked into joining up. But there remained a hard core who stood by their convictions and re- fused to support Artime's budding junta. What happened,to these stub- born ones should be an object lesson to a nation that has permitted its cloak-and-dagger boys to run their own private little dictatorships. Long weeks later, after the Cuban invasion had failed, the story was told to The New York Times by Dr. Rodolfo Nodal Tarafa, a young law- yer who ha,d been in the training camp at Trax, Guatemala, when At- time staged his coup. On January 31, Dr. Nodal said, the senior mil- itary adviser in the Trax camp, known to the Cubans only as "Frank," mustered the 300 training freedom fighters and told them their two commanding Cuban officers had been sent away for "playing politics." They would be commanded hence- forth, "Frank" said, by Captain San Roman. This choice was distinctly unpopular with the Cubans in camp. Captain San Roman had been an officer of Fulgencio Batista and was reported to have fought against Castro in the Sierra Maestra. In San Roman, the freedom fighters smell- ed the stench of the old, brutal Batista dictatorship; and since this wasn't the kind of "cause" for which they were prepared to die, 230 of the 300 asked to resign. Theirs was supposed to b'e a' free volunteer army, but of course such insubordination, could. not be per- mitted. Another agent by the name of "Bernie" was summoned to deal with the trouble. He charged the 230. recalcitrants with being Com- munists. He declared he had author- ity from the Democratic Revolution- ary Front to name commanders, and he had picked Captain San Roman for them. That was that. But the Cubans didn't seem to see the logic in this clear, democratic reasoning, It seemed to them that they were the ones who had been elected to do the fighting and the dying, and they should have something to say about the cause for which they were pre- pared to 'snake such sacrifices They demanded that their case be heard by the` Front within seventy-two hours. Otherwise, they wanted to be discharged and returned home. A committee of five was selected to present this protest. "Bernie" re- fused to receive the delegation. He agreed finally to talk to a single spokesman, and Dr. Nodal was chosen. The lawyer explained to `Bernie" that the freedom fighters were neither mercenaries nor con- scripts, and that they could not ac- cept commanders who represented the very antithesis of the ideals for which they were fighting. "Bernie" suggested that the troops agree to train for five days more while they waited for a representative from the Democratic Revolutionary Front to arrive. They agreed. But seven days passed, and nothing happened. The troops again went on strike. Iron Beneath Velvet Now CIA took off the silken gloves of deceit. Threats and prom- ises were freely employed. Gradu- ally, the protesting troops were browbeaten into submission-all but twenty. These twenty were obdu- rate. On February 11, while the rest of the men were on field exercises, one of the advisers asked eight of the twenty to go with him. They thought, Dr. Nodal says, that there was to be another conference. Not until they had been led along a jun- gle track to a canvas-covered truck did they discover their error. There they were, suddenly covered by three men holding Thompson submachine guns. The eight were driven to La Suiza, an estate where there was a Guate?- Army camp. There they were surrounded by eight or ten men with automatic weapons. Each of the eight was taken separately from the truck; each was taken into a small room, forced to empty his pockets, forced to'strip off all his clothes. "I felt sure this was it," Dr. Nodal said. "I was sure we were .going to be murdered." But not even CIA was quite equal to that. The men, deprived of "even our love letters," as Dr. Nodal says, were permitted to dress again. They were taken to a shed 15 feet by 30, with concrete floor and galvanized iron roof-a furnace by day, an icy igloo by night. Here they were im- prisoned. For twelve days, they were not permitted to bathe or shave, to have clean clothes or to eat a really edible meal. Periodical- ly, they were questioned by another CIA mystery man, known to them only as "Pat," the chief security guard. They were given lie-detector tests, virtually at gunpoint. The ob- ject was to make them confess that they were Communists, for obvi- ously such stubborn and disagreeable characters simply had to be Com- munists. Naturally, they wouldn't admit it, and strangely enough, as far as can be learned, the lie-detector tests didn't show it. In frustration, the CIA finally flew the stubborn holdouts, now seventeen in number, to a jungle prison in remote Peten Province in northern Guatemala. Here they were. held under armed guard and warned they would be shot if they tried to escape. They were warned, too, that when the revolution succeeded they would be turned over to the new Cuban gov- ernment to face trial and, probably, execution. This fate they were spared by the failure of the invasion for which, originally, they had trained so ar- dently. With that unexpected col- lapse of all its plans, CIA acquired, if not a change of heart, at least a twinge of discretion. It released the seventeen "freedom fighters" it had held in cruel jungle imprisonment for eleven weeks, flew them back June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 565. Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 to Miami and dumped them out. There Dr. Nodal and the others started their own resistance movc- mcnt It has one primary, over-rid- ing principle: it will have nothing to do with CIA. Kennedy's Dilemma Such is the background against which the CIA set out to insure the "liberation" of Cuba from Cas- tro. No one in Washington, of course, had any idea of the manner in which CIA was indoctrinating the prin- ciples of democracy into its "freedom fighters" in the Guatemalan jungles. It has become obvious that no one on any level of government, not the Congress, not the President, had any clear conception of what CIA was up to or how it was running the store; yet it was in such a miasma of misinformation and non-informa- tion that President Kennedy had to make a crucial decision. It is not clear just when he first learned of the invasion plans set on foot by Nixon and Eisenhower. One version has pictured him as learning about the project for the first time shortly after the election. According to this version, the inva- sion had been scheduled for the late fall, but Kennedy was so shocked by the idea that the stroke was postponed to let him make the de- cision. Against the background of what is known, all of this appears unlikely; for Kennedy himself, in his television debates with Nixon, had proposed just such drastic action as the Eisenhower administration contemplated-and Nixon, it should be noted parenthetically, had held up his hands in pious horror at the thought. In any event, in January, Kennedy began to get detailed re- ports on the Cuban invasion project from CIA and from the State and Defense Departments. He was con- fronted with an evil dilemma. The Cuban rebels had spent months in the training camps; they were ready to go; they could not be held in leash forever. Futher- more, the publicity so belatedly given about the Guatemalan train- ing bases had stripped the mask from our CIA-overrun puppet state; embarrassed, Guatemalan officials yielded to public outcry and inform- ed the United States we would soon have to get out. CIA further intensi- fied the pressure on the President. Castro, it reported, was getting So- viet tanks and MIGs; he was step- ping up his counterintelligence ac- tivities throughout the nation. It was now or never. Such were the strong pressures for action-for a decision, as Sher- man Kent once wrote, "off the top of the head." Yet even so, inside the Kennedy Administration, there was much soul-searching and a quite definite tug of war. The President himself, aware that the contemplated American-backed invasion would violate every provision of the 1948 Pact of Bogota, prohibiting the use of force against the governments of American states, frowned on any direct American participation. Sec- retary of State Dean Rusk apparent- 1y doubted the wisdom of the entire venture, but he was not a strong enough man to fight for his con- victions. Chester Bowles disliked the whole idea, leaked his dislike to the press, but apparently wasn't con- sulted in the final decision. Senator William Fulbright, chairman of the Foreign Relations Committee, was the one man with convictions who fought stoutly for them, but his pro- tests were ignored. Determinative in making up the President's mind for him, it appears, was the information supplied by CIA, backed up by Navy Intelligence. This insisted that Cas- tro's island empire was ripe for revo- lution. Independent analyses by amateurs that pointed to a directly opposite conclusion were ignored. It was decided to strike. Shotgun Wedding Before the actual invasion, there was a CIA-arranged, shotgun wed- ding. CIA, a great togetherness out- fit, wanted to get all the anti-Castro groups together pulling in harness behind Manuel Artime, the field commander it had already selected for them. With Bissell wielding the whip, it was announced on March 22 that a Revolutionary Council had been formed two days previously in Miami. The provisional president of the council was Jose Mird Car- dona, who had been Castro's first Premier, but had quickly broken with the dictator. Manolo Ray was a member of the council, but its overwhelming complexion was con- servative. It was understood that Cardona would become Provisional President as soon as the invading troops had carved out a foothold on Cuban soil. Later there would be free elections. Just what trust should have been placed in these promises in view of CIA's action in investing full military power in Artime, in view of the murky Operation 40, remains a matter of conjecture. Political control established, the next consideration was CIA's inva- sion plan. Originally, the cloak-and- dagger agency wanted to hurl all the available invasion forces ashore at one point in one all-out assault. From the first, it appears, Manolo Ray's MRP doubted the wisdom of CIA's military conceptions. Ray felt that the only way to overthrow Cas- tro was to use Castro's own formula against him-to infiltrate Cuba with small guerrilla groups, to build up the program of sabotage and re- sistance within the country to the bursting point. So strongly did Ray feel about this that it appears he even contemplated taking his MRP out of the Revolutionary Front; but, in the end, he went along because, as he later said, "we did not want to give the slightest aid to the Com- Dubious Military Tactic CIA's tactical plan raised other doubts. The invasion beach it select- ed was in the swampy, isolated Bay of Pigs, ninety miles southeast of Havana. The idea apparently shock- ed Colonel Ramon Barquin, an Army officer who had been imprisoned by Batista, one of the most respected military figures among the emigres and the man who almost certainly would have been Ray's choice to command the invasion had Ray had a choice. Colonel Barquin pointed out that only two narrow, easily de- fended paths led inland from the Bay of Pigs. One was a narrow road, the other a narrow railroad bed. On either side of these defiles, for a distance of twenty-four miles inland, stretched impenetrable, mosquito- infested swamps. "This swamp of- fers some advantages-you can't be 566 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 Ths NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 San Francisco Chronicle Times-Mirror Syndicate "Achilles Heel" Some U. S. Press Comment On the Cuban Invasion and the CIA St. Louis Post-Dispatch June 24, 1961 _ On^T.p.b wr.o~.n~,4, "P.r-s-st -.rn ell something burang?" Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 567 St., Louis Post=Dispatch Oakland Tribune Oakland Tribune Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 flanked," Colonel Barquin conceded. "But it makes no difference; you can be stopped easily enough." All that Castro would have to do would be to concentrate tanks and troops at the mouths of the two funnels opening onto the central Cuban plain; his task would be like putting a cork in the mouth of a bottle. The ways to disaster had now been greased by CIA decisions that, it would seem, had erred at each and every step along the way; the in- vasion ship was about to be launch- ed. On March 29, after making some changes in plan, President Kennedy flashed the green light from the White House. One of the President's modifications banned U.S. aerial strikes in support of the invaders; the Cubans must do it on their own. Another dealt with the cleaning out of Batista supporters in the invasion army. The President himself, it is said, ordered the arrest of Rolando Masferrer, the best-known Batista henchman; but, while this order was carried out, CIA heeded imperfectly the President's intent. Other Batista luminaries like Captain San Roman sailed from Guatemala in command of their troops. The attack began with surprise raids by B-26s on Castro's airfields. They wrought some damage, but, as events were to show, not enough. This was the first failure, but it wasn't the most serious. For a stra- tegic move that reads like something out of Gilbert and Sullivan, one has to thank the masterminds of CIA. On some level-on just what level and on just whose authority the American public, presumably, will never be permitted to know-the brilliant decision was reached that the Cuban leaders of the Revolution- ary Front were not to be permitted to have anything to say, or to do, with their own invasion. Climax to a Nightmare On April 16, the day before the actual invasion, Dr. Jose Miro Car-, dona and the members of his Revo- lutionary Council were in New York. They received word to go to Phila- delphia. There they were met and flown to Miami. The instant they arrived, they were conducted to a small, isolated house on the out- skirts. Here they were held virtual prisoners. They were not permitted to use the telephone. They were not permitted to communicate with any- one. They were allowed only to listen to radio reports of how their invasion was being managed for them. Here, perhaps, is the most fantastic episode of the entire fantastic night- mare. The success of the invasion from the outset clearly depended on a mass uprising of the Cuban people in its support. But Ray, the under- ground commander, the only leader who could have been effective in marshaling such support, was muz- zled. Obviously, he was too left-wing, too dangerous a man. Obviously, too, CIA wasn't trusting any of the other members of the Revolutionary Council; it was making certain that they didn't interfere with CIA's invasion. Some genius in CIA evidently de- cided that the Cuban people would arise en masse if a message was beamed to them from our Swan Is- land radio station off the Honduran coast. And so this message was con- cocted: Alert! Alert! Look well at the rainbow. The first will rise very soon. Chico is in the house. Visit him. The sky is blue. Place notice in the tree. The tree is green and brown. The letters arrived well. The letters are white. The fish will not take much time to rise. The fish is red. Look well at the rainbow.... This gibberish, as far as can be learned, was the only notice the Cuban people ever got. Ray's under- ground, so assiduously kept in the dark by CIA, didn't even know an invasion was coming off-and so did nothing. The Cuban people apparent- ly didn't make much sense out of that fish and rainbow business-and so did nothing. The invasion troops stormed ashore and found Castro, much better informed than the underground, waiting for them. The debacle was swift. The in- vaders stabbed inland along the one narrow road, the one narrow railroad bed. They penetrated for twenty miles, and then they were hit by tanks, by artillery fire, by strafing from the air. American papers carried glaring headlines about Russian MIGs turning the tide, but less hysterical reports later showed that there wasn't a MIG in the air. Cas- tro had armed some old jet-trainer planes, and these were enough. An ammunition ship, carrying practical- ly all of the reserve supplies for the expedition, was sunk. The narrow road and railroad track were smother- ed by fire. On either side the jungles hemmed in the invaders. They could not advance, they could not escape; they could only' surrender. Post-Mortem Debacle Now, to compound the military disaster, came other disasters, the full effects of which almost certainly have not yet been totaled. First, there was the lying. As in the U-2 disaster, we tried to deny the self- evident truth. In a world that we expect to accept America's word as its bond, we deliberately set out to demonstrate again that this word was worthless. Rep. William Fitts Ryan (D., N.Y.) writes that, after the invasion had been under way for twenty-four hours, "an official repre- sentative of the State Department stood in the 20th Congressional Dis- trict Office in Washington and said that neither the CIA, the State De- partment nor any other government agency was involved `in any way."' Worse, far worse, was the spectacle in the United Nations. There Adlai Stevenson, our Am- bassador to the U.N., a man of tre- mendous personal prestige not only among Americans but among the peoples of the world, put his prestige on the line in a lost and tarnished cause. Apparently, he hadn't been told the truth by his own govern- ment; and so, replying to charges of American intervention made by the Cuban delegate, Stevenson de- nied categorically that the United States had had any hand-any hand at all-in the attempt to overthrow Castro. Such charges, he said, were a tissue of lies delivered "in the jargon of communism." He added: "If the Castro regime has hostility to fear, it is the hostility of Cubans, not of Americans. . . . If the Castro regime is overthrown, it will be over- thrown by Cubans, not Americans. I do not see that it is the obligation of the United States to protect Dr. Castro from the consequences of his 568 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATION Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 treason to the promises- of his revo- lu tion." To turn Stevenson's own phrase back upon him, what kind of "jar- gon" is this? . Even though television viewers who had venerated Stevenson turned away sick at the sight, American officials still were not willing to em- brace truth. A determined effort was made, with the help of the Madison Avenue public relations firm that had been hired to handle pronounce- ments for the Cubans, to picture the invasion as no invasion at all- just a little guerrilla operation in- volving no more than 200 or 300 men, many of whom had succeeded in making contact with rebel forces in the interior of Cuba. Thie myth quickly was exploded by Castro. He paraded some 1,200 captives for all the world to see. He even had them tell their stories on tele- vision. There, in the full glare of the k]ieg lights, some were identified as former Batista, thugs; and all, almost to a man, pleaded they had been deceived by the CIA. Catastrophic as all this was, it was not the end of the catastrophe. Castro's police and Army put on a nation-wide hunt for subversives. It is estimated that 100,000 suspects were rounded up. Though many were finally released, hardly a single leader in Ray's underground escaped. Resistance leaders denounced CIA bitterly. Their organization, they said, had been wrecked, and some wondered out loud whether this had been part of CIA's intention: In a Cuban prison, Associated Press cor- respondent Robert Berrellez met a twenty-two-year-old Cuban who had been one of Ray's principal lieu- tenants in the Cuban underground. This Cuban complained bitterly that, a month before the invasion, the CIA radio station on Swan Island had actually broadcast his name to Castro's police. "This station paid tribute to me by name for helping exiles get out of Cuba clandestinely," the resistance leader said. "That tipped off G-2 and I was finally trapped." In the light of such stories, can one wonder that many Cubans refuse to trust CIA any more? The extent of the distrust was clearly indicated in Miami on May 23, when Ray finally took his MRP out of the Cuban Revolutionary Council. The move, he said bluntly, was in pro- test against the CIA's continued domination of the Cuban resistance, its continued playing of Cuban poli- tics, its continued refusal to support MRP and its continued recruitment of former Batista officials for a new "national army." This would seem to indicate that not even a disaster of the magnitude of Cuba can change the rigid mentality of CIA, can drag it-to use an old Stevenson phrase- "kicking and screaming into the twentieth century." Cuba, and CIA's infatuation with Batista bravos and authoritarians of the far Right, are merely the final chapter in a book in which the plots, whatever else may be said of them, are all consistent. Iran, Guatemala, Laos, Cuba: in all of them, the CIA's fondest affection has been re- served for militarists with nineteenth- century social outlooks, for small and wealthy ruling cliques that have no sincere interest in the welfare of the millions whom they govern. The im- position of such governments merely stalls the future and gives Khrush- chev his talking points. As Stuart Novins wrote in a perceptive final paragraph in his account of the Cuban fiasco in The Reporter: The tragic episode ... raises a number of obvious questions about the activities of the Central Intelli- gence Agency. But beyond that, there is reason to doubt that even if the attack had been successful, it could have produced a viable politi- cal resolution for the bloody turmoil of Cuba's recent history. To liberate Cuba from the outside, with ?a gov- ernment to be imposed from the outside, is not the most promising way to promote a stable democracy in Cuba and to advance the social and economic welfare of its people. .Not only does Cuba know this, but far more important, the rest of Latin America knows it too. PART IX ALOOK AT THE FUTURE .If it is true that the agency [CIAO mapped the invasion plan, herded the Cuban resistance leaders around like redheaded stepchildren and con- ducted military operations in their stead, then we have trusted a Gov- ernment agency to make all but war without the consent of Congress.- Rep. Paul G. Rogers (D., Fla.) in the House of Representatives, May 1, 1961. I want my position to be crystal clear. The Pentagon, the military services, and the intelligence services of the nation are to be the servants of the policymakers. They are not to be policymakers in themselves.... If we have learned anything in recent months ... it is that the pre- ponderance of the emphasis ... on the part of the military, the Central Intelligence Agency, and the other intelligence services was overwhelm- ingly involved in the policymaking functions of the Government,- to the point where the actions of the mili- tary and the CIA ? made policy through their preemption of the field.-Senator Hubert D. Humphrey (D., Minn.) in the Senate, May 3, 1961. THESE TWO quotes pose an issue that, in its depth and dimensions, appears still not to have been fully realized by the American people. This is no issue of internal organization. This is no technical issue, involving the -combination of intelligence. and action functions in one agency, the CIA, though that is part of it. This is an issue that goes to the very guts of the democratic processes. In- volved here is the question of whether the "black" arts (sabotage, revolu- tion, invasion) are to dominate all American democratic functions and to determine for our people willy- nilly, without debate, without knowl- edge even of what is at stake, the course their nation is to take in June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 569 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 the world. No lesser issue amounts to a tinker's damn here. Congress alone, under our Con- stitution, is supposed to have the right to declare war. This safeguard was devised by the Founding Fathers with the wise intent of insuring that no Executive with a mania for power could ever determine for the people whether they were to live in peace, or to fight and die. Only the people through their representatives in Con- gress- were to decide their own fate on this most crucial of all 'issues. Today, with intercontinental ballistic missiles and nuclear warheads cast- ing a dread shadow over the world, there is more need than ever before in history for an intelligent and in- formed electorate to exercise the re- straints and the powers of decision guaranteed in the Constitution. Yet today we 'practice the "black" arts on such a far-flung, billion-dollar scale, we throw around them such a mantle of spurious patriotic secrecy, that neither the people nor their watchdogs in, Congress. have the faintest idea what is happening un- til it has happened-until it is too late. In essence, CIA, which is at the root of the evil, has become a Frankenstein monster dominating the Congress that created it. The result is a twofold tragedy. Abroad, CIA destroys our prestige and undermines our influence. At home we do not even know what is happening. Actions Belie Words Our Presidents-Eisenhower was notable for this and was motivated, nearly everyone would agree, by a deep sincerity-proclaim our peace- ful intentions, our devotion to the ideals of democracy and good will and world peace. The American people sincerely believe that this is what we stand for and cannot com- prehend why the world at large does not believe in our so obviously good intentions. Our people do not under- stand that, even as our Presidents speak, the actions of CIA frequently invest their words with every ap- pearance of the most arrant hypoc- risy. The Presidents speak peace; but the CIA overthrows regimes, plots internal sabotage and revolu- tion, foists opium-growers on a friendly nation, directs military in- vasions, backs right-wing militarists. These are not the actions of a demo- cratic, peace-loving nation devoted to the high ideals Nye profess. These are the actions of the Comintern in right-wing robes. America, no more than the USSR, can speak out of both sides of its mouth and ex- pect the peoples of the world to trust in its sincerity. All of this goes on abroad, but at home the American public does not know for long months, if ever, what CIA has brewed. The power of a billion-dollar, secret agency operating as a law unto itself is almost in- calculable, not just in molding the image of America in foreign lands, but in molding at home the image Americans have of the world around them. Time and again American public opinion has been whiplashed into a warlike frenzy by glaring head- lines picturing a callous Communist aggressor when, all the time, the CIA was the secret provocative agent. The crisis over Quemoy was a glaring example. The U-2 incident, in which our government lied to "cover" CIA and pictured to the public a Russian bear reaching out another. Less well known, but per- haps .of greater long-range impor- tance, is the manner in which our whole attitude toward Communist China has been deliberately colored, as Charles Edmundson has written, by "the State Department's repeated and sometimes incendiary statements that all Americans held prisoner in Communist China are held illegally and in violation of international law. Every well-informed correspondent and editor in Washington knows that many of the prisoners have been U.S. intelligence agents, whom China has as much right to hold as the United States has to imprison Ru- dolph Ivanovich Abel, the Soviet `master spy."' By such tactics, Ed- mundson writes, the American pub- lic has been. bamboozled "to the point where a rational China policy has become a political impossibility." Free to WRITERS' seeking a book publisher Two fact-limed. illustrated brochures tell how to publish your book, get 4V e royalties, nationaladvertisiiie. publicity and promotion. Free edi- torial appraisal. Write Dept. ica Exposition Press, 386Park Axe. S.,H Y.16 A CANADIAN REVIEW of Politics ? Science Foreign Affairs Arts and Letters QUEEN'S QUARTERLY One Year $4 Three Years $10 QUEEN'S UNIVERSITY Kingston, Ontario, Canada Making Peace Difficult It may even be that a rational policy of any kind has become a political impossibility. Cyrus Eaton, the multi-millionaire Cleveland in- dustrialist who has long championed a policy of -coexistence with China and the Soviet Union, pointedly suggests that either CIA or some of its secretive governmental col- laborators is indulging, within the United States, in propaganda activi- ties designed to make any peaceful solution impossible. In a letter to Senator Fulbright, Eaton charges that federal funds are being funneled secretly into the promotion of demonstrations designed to inflame public opinion against visiting iron- curtain diplomats. Eaton writes: An interesting question is, who supplies the funds to hire the pro- fessionals who surround the embas- sies and follow foreign visitors with insulting signs and shouted epithets' I find it hard to believe, but I ant informed that substantial funds for such undesirable activities come from federal appropriations, under a dis- guised name. After the. Soviet Deputy Premier, Mr. Mikoyan, visited me in Cleve- land, I made a point of investigating the group of Hungarians who en- deavoured to molest him in Cleve- land, Detroit and Chicago. It turned out that the identical people had with bloody paw to down our in- gone into all three cities by car and nocent little weather plane, was had obviously been hired and fi- 570 ease 2004/03/26 : CIA-RDP64B00346R000100300061-5 The NATioN Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 .nanced by someone with, ample fufds, reputedly Uncle Sam-. In Cleveland, representatives of the State Depart- ment gave every evidence of con- niving with the Hungarian hecklers by putting at their disposal the routes and locations most advan- tageous for their hostile demonstra- tions against the Mikoyan party. I have also looked carefully into the background of the so-called Hun- garian Freedom Fighters. Many of them turn, out to be former officers of the Nazi Army that invaded Jinx- gary; they were, of course, obliged to flee the country when Hitler was defeated. (Italics added.) This is a truly sensational charge. Eaton's very name, of course, is anathema to right-wingers, but. Con- gressional attempts to investigate him. have proved largely futile and he remains a powerful and influential man. Whether investigation would establish the validity of his charge remains uncertain; but in consider- ing it, two facts perhaps should be borne in mind-the long love af- fair of CIA with the Gehlen agency, which included former Nazi officers and operated in Hungary, and the Cuban freedom fighters' recollections of the number of "East European" CIA agents who, with the aid of in- terpreters, directed their drills in Guatemala. If these should ever turn out to be. true straws in the wind, if Eaton's charge should ever be substantiated, an entire new field of secret CIA activity might be ex- posed-one more pernicious than any other in its underhanded influence on American public opinion. forte, its ironclad secrecy. "Once secrecy becomes sacrosanct, it in- vites abuse," the committee wrote. "Secrecy now beclouds everything about CIA. . . ." The committee quoted with approbation the com- ment of Hanson Baldwin of The New York Times that CIA "engages in activities that, unless carefully balanced and well executed, could lead to political, psychological, and even military defeats, and even to changes in our form of government." The first part of that prediction has certainly come to pass. As for the second, the committee itself wrote: "Our form of government . . . is based on a system of checks and balances. If this system gets serious- ly out of balance at any point, the whole system is jeopardized and the way is open for the growth of tyranny." The way is still open. For the Congress of 1956 did nothing. And we reaped the whirlwind in Laos and in Cuba. The new, Executive-style investi- gation ordered by President Ken- nedy can hardly'be expected to meet the .full need, the full right, of the American people to know. Gen. Maxwell Taylor 'leads the President's new investigating board; the Presi- dent's brother, Attorney General Robert Kennedy, sits upon it. So does Allen Dulles, the man being investigated. It may be noted that SAVE YOUR COPIES OF THE NATION ? Each file holds a full year's copies. ? Jesse Jones Volume Files for every publi- cation, ? Covered in durable leather like Kivar, title embossed in 16 Xt. gold. Satisfaction guaranteed Attractive and practical for your home or office S for $7.00 6 for $13.00 ORDER NOW - send check or money order Magazine File Co. 520 Fifth Avenue New York 36, N.Y. DESCRI FOLDER FREE U PONPRIEQUESTI This Week and Every Week If you liked this week's issue of The Nation, you will like it every week. Regular issue or special, The Nation is a magnet for the independent, questioning mind. The formula is no secret: The'Nation is always heading for controversy and more often than not champions the minority side. If today The Nation concentrates on the, CIA, tomorrow it may be revealing the absurdity of an economic, political or cultural cliche. The best way to get The Nation is by subscription. You vestigated four times in the past- I save money week in and week out. Fill out the coupon. What Kind of Probe? CIA is, of course, now being in- vestigated. It is being investigated now just as it has already been in- in private, in secret. Each investiga- tion found flaws. Each reported CIA was working to. correct them. Each succeeding probe found some of the same flaws and reported that CIA was working to correct them. And now, in 1961, we have come to our THE NATION 333 Sixth Avenue, New York 14 ^ One Year, $8 ^ Two Years, $14 ^ Three Years, $20 ^ 6 Months, $4 ^ Bill Me ^ Payment Enclosed (Foreign and Canadian Postage $1 a year extra) NAME ............... ............................. .... .,.......,,...... .......... ....... ....... ........ .......................................... .......... ....., . ADDRESS .................................................................................................................................................... The committee took some round- I CITY...... ................ ........ ............................................... ...............- ZONE................ STATE .......... ..- _>... house swings at CIA's most recious 6-24-6 present pass. In 1956, a Congressional Joint Committee called futilely for the appointment of a watchdog com- mission. to put a checkrein on CIA. .r June 24, 1961 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 5.71 Approved For Release 2004/03/26 : CIA-RDP64B00346R000100300061-5 it is rare indeed when the defendant turns star prosecutor at his own inquest. The record of the past few years seems to say clearly that the colossal Hies : CIA has created demands nothing less than a full-scale Con- gressional investigation. It is not enough just to lop off CIA's opera- tional arm and give its "black arts" intriguers to some other secret Beautiful 8 mile lake. Golf at a magnificent Country Club. Dancing. Entertainment. Sn- perh Cuisine. Fireproof Bldg. Elevator. Special "single" weekends. Group facilities. In New York City call at local rats. FAirbanks 5-7227 MAhopao 5-344!1 A LAKE MAHOPAC, N. 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Meet 30 other nice people. Adults $40, Children $5i per week. V. Schwartz, SPRING MT. 110US10, Jeffersonville, N. Y. Phone: Jeff. 290. PINECRESTIN THE BERKSHIRES W. Cornwall. Conn.: On Housatonic River A delightful vacation resort near Music Mt., Summer Theatres. Sandy beach, swimming, fish- ing, boating; tennis, badminton, ping-pong. Lovely lawns for relaxing. Delicious food. Cab- ins with private showers and fireplaces. Diann, & Abe Berman TO 2-3003 agency; we need to -examine 'in detail just what the "black arts" have brought us, we need to consider whether they can ever be reconciled with the principle's of democracy- the principles we profess. It is not enough just to give Congress finally, at long last, a watchdog committee (a move, incidentally, that is still by no means certain); we need to examine publicly, in detail, the qualities of mind and the kind of hidden interests that have placed our prestige unreservedly behind wealthy oligarchies and right-wing militarists in a world in which the growing clamor on every side is for social and economic justice, social and economic change. We need to discover how and why, as Walter Lippmann wrote, we are doing just what Khrushchev expects us to do, why we are doingbis propagandizing for him. Only if we make basic de- terminations of this kind can we hope for the future. And we cannot make them if we do not first learn the who and the bow and the why that have so often placed us on the wrong and losing side-if we do not clean out the forces that put us there. This, only an aroused Con- gress could hope to accomplish. At Stake: the World's Faith Both the -faith of .foreign nations in us and our own faith in ourselves are at stake, for both have been deeply compromised by the shady activities and the secrecy surround- ing the shadiness that have become the twin hallmarks of CIA. When, hard on the heels of Cuba, the French generals in Algeria tried to overthrow Charles de Gaulle, we were confronted by all-but-official charges in the French press that CIA once more had egged on the mill- Enjoy a Vacation Plus at World Fellowship Center Combine Recreation, Fellowship with Friendly People, and Discussion of World Problems at our Forest-Mountain-Lake Estate - - near Conway, N. H. Summer Theme: CROSSING NEW FRONTIERS: June 30-Sept. 4 Conferences on Youth in Action; The Need to Dissent; New Forces in the Integration Struggle; Labor's New Responsibility; Cuba, Latin America and the L S.A.: Africa in World Affairs; China and World Meet People of Various Races, Faiths, Nationalities and Political Philosophies. Dr. Willard Tbhaus, Director Styli[\MING, HIEING, FISHING, SUNHEII 'HLATRE, 3MOOUNTAiN TRIPS. Grrnecous I+'anlily-Style Meals. Board, Room & 'Program $5.50 to $3.60 Daily. For full information on speakers and dates of conferences, address: WORLD FELLOWSHIP Conway, New Hampshire tarists. M. SousteIle, at a luncheon in Washington last December 7, is said to have talked long and earnest- ly to CIA Deputy Director Richard Bissell; Jr., on the proposition that de Gaulle's program in Algeria could lead only to communism. CIA is said to have been impressed; Gen- eral Challe, who led the revolt, is said to have had several meetings with CIA agents; he is reported to have been given the impression that he would have the support of the United States. All of this Mr. Dulles and the CIA categorically deny. But Walter Lipp- mann reported from Paris that it is known that CIA agents meddled in France's internal affairs during the French debate on the nuclear-arms program. And the highest French officials, pleased by President Ken- nedy's prompt and whole-hearted support of de Gaulle, have called the Algerian incident closed-but they,have not, pointedly they have not, given a full and clean bill of health to CIA. It is a sequence that leaves a foul taste in the mouth. As The New .Republic's Washington cor- respondent wrote, commenting on the French charges and recalling the background incidents of U-2 and Cuba: "Preposterous-? Certainly! And yet . . . and yet. . . . It is not that we think for a minute that the French charge is true, but that now we are suspicious of everything." So we are. L'Express, with pointed intent, quotes Allen Dulles: "The countries which are the most power- ful to resist Communist subversion are those where the military are in poorer," We recall this hard kernel of Dulles' philosophy acting itself out in Egypt, in Iran, in Guatemala, in Laos, in Cuba. Why not in France? Could it be possible in so large a power, one of our oldest Allies? Well -why not? - In the secret world of CIA anything is possible-and no one knows. We can only wonder and doubt. And doubt does not. inspire confidence abroad or fervor at home. It's time to clean house. BULK COPIES AVAILABLE. This special issue Of The Nation is available for orders in bulk. See back cover for reduced rates and order blank. Supplies are limited, so act now. The NATION Approved For Release. 2004/03/26 : CIA-RDP64B00346R000100300061-5 Crossword Puzzle. No. By FRANK W. 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(6) DOWN: 2 See 5 across 3 Those who make lace out of rags? 4 Get a toe-in job, and arrange things 921 this way. (9) 5 Man takes these occasions to make laws. (5) 6 The root of psychic. or youthful problems? (7) 7 Its center is cut with a cross. (9) 8 Presently on board, but yet not in place. (7) 9 Did Cleopatra have to rouse it at last? We hope so! (6) 15 Making double-talk? (The fabric needs taking in.) (9) 17 Such words as 22 do, making pre- cious sense. (9) 18 A trailer in Technicolor? (7) 19 What's happening around the prim- itive force of the plain? (7) 20 Coins, as changed by one that evi- dently rolls over and over. (7') 21 Go along with a canonized list. (6) 23 Skirts and matadors might be. (5) 25 When "Mr. William Shakespear" was a boy he exercised his father's, according to John Aubrey. 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