ECONOMIC INTELLIGENCE - AN ACTION PROGRAM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80M01082A000600130004-2
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 25
• Document Creation Date: December 15, 2016
• Document Release Date: May 20, 2004
• Sequence Number: 4
• Publication Date: December 3, 1974
• Content Type: MF

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Office of the Deputy
for the Intelligence %om.munfty
DCt/IC`-74-~'~i6
MEMORANDUM FCR: Chairman, National Security Course-il
intelligence Committee
SUBJECT "Economic Intelligence - An Action Prc~ras.
1. The Director of Central Intelligence has requeste:?~: Er r~va
to you and other NS~;,IC members a copy of hie paper, "~:cnciz is
Intelligence - An Actio~i Program" which was recently disirib~ed t,;
the United States Int:ellige>ace Board and the Intelligenct k.~~sCfux Ler;
Advisory Committee.
2. The Action Program, which constitutes teaks #o tie eat?ricr^
out by the intelligence community in FY 75, has been re~~~.E wed ;~~r
Mr. Leo Cherne of the President's Foreign Intelligence cviea ~-y
Board. He advises that it is "excellent and, to the ex~ ant r:her~ u-ii
in fact be active participation its the inter-agency cornmittere a :d
boars, will clearly assure a significant contribution to ~t~:~ ma .i.i
of economic policy. " Additionally, he notes his agreem,erxt wit=: the
Director that "economic intelligence producers (and colie~~ars. u: ix
be pxepared to shift their efforts and resources in line wiry cha~~f-
needs. "
3. Copies of this same paper were distributed tc thy: ~TSC
Working Croup merr.~bers at the 20 November meeting. C.~.~ies :evil:.
be made available tc~ uaPmbers of the NSCIC Economic Lnta4~.Iigece
Subcommittee once it is organised.
Att~:~'hnts' as stat~.d
cc: All NSCIC Meml'ers
Samuel V. ~t'ilsnr
Lt. General, U ~~.
C:hafrrnan, N3CLC ~c~?kin#' ~ ~~~o
M fi
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A.nong the Objectives for the intfilligenee Co:a-?F-::pit-,
that the DCI presen-~ed in Sep ~enber 19 ; 3 in a r~mor~~.ndua?1 tc
the President was o~.ze requiring action to enhance i t-;~
utility of intelligence in suppo_t of "economic po?a_cie~> o`
the U. S . Government . " A prograrl meeting this cc~~-r._tr-~en~: is
outlined below. jvnile this prcgra:~i focuses primari~Fy or
formal institutiona:L arrangements, it is recognized than: tc
a great extent the effectiveness of economic intzlligenc~e
supgor ring policyma};ers is governed by the day-to-
northing like a c{ood post-mortem to generate attention
to the future. Perhaps the IC Economic Intelligenc
Committee could develop this.
(e) There are a number of specifics left in Mr_
Cherne's memo to which we certainly must respond in
the. course of our current production. Note especially
the comments on pages 5-$. Note. also the specific
suggestion for an assessment of the likely impact on
.sugar prices of any change in the Cuban situation.
Another item would of course be what the Arabs zriight
do with respect to an inflation supplement to current.
oil prices.
(f) Another longer NIE-type paper might be develoi~
on the prospect: of economic unity or economic nati~na
as oil and othea: inflation pressures come to bear on
.vulnerable countries, especially Europe.
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(g) The remarks on page 4 indicate that Mr. C~:.erne
essentially accepts our "Economic Action Plan" inc:iude3
in my letter to him of 18 October. I hope we have
circulated this tq,LTSIB, NS C, RAB as we stated ir.
-that letter. If not, I think we s3iould go ahead. and
do it.
3. -Let us discuss among ourselves at an early Morr_ing
Meeting your comments or further suggestions..
Approved- For Re#ea~e
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W. E. Colby
Director
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V'/ASHlNG70N, D. C. 205Q5
Mr. Leo Cherne
President's Foreign ]:ntelli.gence Advisory .Board
The White House
Washington, D. C.
4 NovQmber t97 ~
Dear 1VIr, Cherne:
-Thank you so very much far your letter of 25 October witl its r.a;~st
fascinating and challenging attachment. Your words about the L~tell;~.;~-~~ce
Community were certainly appreciated, bat I hasten to indicate `hat tE aj
-real praise- does not go to me but to the people in it who did the .~ctu3
tivork, I agree entirely, however, with your comment that tive a.-e rt,r ~?-ing
very hard simply to keep up; in fact, I think we are falling behind des;zte
our running. I do think that the stimulus which you personally provi?3s~3,
as .well. as what was pushed by the Hoard earlier, has been of er~~rmo;_ r
value to us and has helped us to get up to the speed we are at,
You will be interested in the attached memorandum that I =;ent t,
my associates on this matter indicating that we really have a lot to dc~ trti
move ahead. In that regard, you will also note that I asked them
fo
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specific set of agenda items around which we might organir,e a dAscu-~_-.inn
ith
tiv
you and the principal figures in the Intelligence Community, I ~~+ E
ensu
th
t
h
re
a
t
ey receive a copy of your remarks beforehand and `here'
hope to focus our discussion on the most useful steps.
We are making some progress on reconstituting the Res
ources
Advisory Board, and I think this will be a particularly fruitful tool in ~;~is
axea. Nonetheless, the real proof of the pudding is going to be in wha? ire
produce, and I especially welcome your suggestions of specific substa~~-
tive questions needing attention. My real problem will be to detprmio=.
whether we have adequate analyst talent for the challenge ahead and, is
not, where I am going 'to find the personnel resources needed, Fart -: a~
be avercorne by better interaction of the talent now in the various agar,=ies
and departments, and I think that shall be my first objective.
~~~D d~~v~~~~ ~ ~I~
STAT
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As you know, I also will be distributing our Economic Actic.n YA.,
which I gather you thought made a certain amount of sense. I haze
deliberately required E:hat I include comments on our performaac, ili.e-:r~-~cx
in our rsext annual report, in ordex to ensure follow-up.
Again,, please let me thank you for your interest, your iznpres~a=-
contribution of knowledge, experience and imagination, and your posi t~ ire
remarks about the Corrununity.
Sincerely,
~` :~- ~:
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October 25, 1974
-The Honorable William E.. Colby
Director.
Central Intelligence Agency
Washington, I3. C. 205fl5
Ilear Mr. Coiby:.
At the last meetin=; of the President's Foreign Intelligence
Advisory Board, I reported on developments affecting economic
intelligence which have occurred since the Board's 1973 report to
the President on this subject. I am especially pleased to send an
edited transcript of the o~~al report to you.
I hope I paid adequate tribute to the contribution which has
been made by the community, under your direction. The results
have been very substantial. At the same time, I think we are ail
running very hard simply to keep up with critical developments.
I will be delighted to discuss with you or any of your colleagues
any questions which are stimulated by the report m enclosing.
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PRESIDENT'S FOREIGN IiJTELLIGENCE AD~TISORY BOARD
November 7, i 974
The attached letter from Leo Cherne is in
response to your letter to him of 18 October.
That letter forwarcled a copy of the Economic
Intelligence Action Program, on which you
invited Leo's comments. As you will see,
he was very favorably imprerssed.
Regards,
tiVheaton B. Byers
The Hon, William E:. Colby
Director of Central Intelligence
Headquarters Building - 7D60
Washington, D. C. 20505
Enclosure; ltr fm I.,eo Cherne to
Mr. Colby, dtd 11/5/74
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November 5, 1974
The Hon. W. E. Colby
Director
Central Intelligence Agency
Washington, D.C. 20505
Dear Mr. Colby:
I regret the delay in answering your important letter. A
brief bout with pneumonia has somewhat scrambled my schedule.
I hope that I have not delayed your circulating copies of the
Action Program to USIB members and others in the government who
are concerned with economic intelligence. I share your convc-
tion that it is important that that be done and, in some respac:ts,
more important now than might have been the case some months ao
simply because there have been more than the usual number of
changes among those who are concerned with policy formation.
The Action Program is, in my opinion, excellent and, to t;ize
extent there will is fact be active participation in the inter-
agency committees and boards, will clearly assure a significant
contribution to the maki~:ig of economic policy.
As you know from the interim report which I presented to
PFIAB, I have conveyed a high opinion of the Community*s respon-
siveness to the new needs for economic intelligence. We have
entered a period in which these needs will increase further,
and the Action Program provides a substantial probability that
those needs will largely be met. Your own personal concern with
those needs has contributed significantly in the past and will,
if anything, be even more vital in the future.
I am in especial agreement with the following observai;ion in
the document yvu sent me: "Past experience clearly indicates that
a substantial number of demands placed by policy-makers on econ-
omic intelligence producers cannot be foreseen far in advance
because of the rapidity with which new economic events occur."
I do not; believe you can responsibly go further than you did in
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the next sentence: "Therefore, economic intelligence producer:
land collectors) will be prepared to shift their efforts and
resources in line with changing needs.'
I am sure I add nothing to your knowledge of the difficul~:ies
in observing that not on:Ly are the needs often impossible to anti-
cipate, but substantial difference-about them exists within the
Executive Branch. For e:xampie, it is my impression that the
Secretary of State is much more pessimistic about the ability to
face the accumulation of liquid reserves in OPEC without substan-
tial international disorder than. is the Secretary of the Tresaury.
Regrettably, on questions like these, subjective judgmen~
cannot be avoided. But responsive intelligence can substantially
narrow the range of differences in judgment as well as their depth,
and the Community's Action Program efforts substantially promise
that that contribution wall be provided.
ti'Vith my deep regard,
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