ECONOMIC INTELLIGENCE A STAFF SURVEY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83M00171R000800080001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 42
• Document Creation Date: December 16, 2016
• Document Release Date: March 14, 2005
• Sequence Number: 1
• Publication Date: May 1, 1974
• Content Type: STUDY

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Economic Intelligence
A Staff Survey
Secret
May 1974
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Warning Notice
Sensitive Intelligence Sources and Methods Involved
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
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31 May 1974
MEMORANDUM FOR: National Intelligence Officer for Economics
SUBJECT A Staff Survey of Economic Intelligence
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1. In his memorandum to the President on 6 Septent,Er
1973, the DCI specified the steps that he would take dLring
a four-to-eighteen month period with respect to the intelli-
gence community's objectives. Objective E states that "Ihe
provision of intelligence and its utilization must enhnce
the formulation of the foreign, military and economic
policies of the U.S. Government and the planning for and
conduct of military operations by U.S. forces." Subsumec
under this objective are several tasks he set for himsEli
with respect to economic intelligence that he was to cemilete
this fiscal year. Subsequently, Mr. Leo Cherne in his r(port
of December 1973 to the President on Economic Intelligence
recommended that the "Board should evaluate this plan zs soon
as available with reference to the adequacy of its proposed
approach to satisfying contemporary, priority economic
intelligence requirements of the U.S. Government."
2. This spring, in preparation for your arrival, _t
undertook a survey of economic intelligence, which T art
hereby providing you. So that the economic intelligence
"plan" can be issued this summer, I have keyed the surge,
to the tasks cited above, and at the same time indicated.
as appropriate, actions to date and proposed actions. '['lus,
in effect, this survey is an approach for the intelligence
community to take in the course of the next year. In s;o doing,
it addresses the problems raised by Mr. Cherne.
3. You will have a major role in implementing and,
modifying, as necessary, this approach. In the meanwh_ld,
many actions have already been taken and others are underway.
Because there is an NIO for Energy that topic receives
only passing treatment in this paper.
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4. I owe a debt of gratitude in the preparation of
this study to Dr. Maurice Ernst Director of CIA's Office
of Economic Research, and hief of the
Intelligence Community Sta s Product Review Division.
discussed with them the complete text and benefited greatly
from their advice and suggestions. I am also deeply grat.-ful
to many others who offered constructive criticism and
technical advice, including Mr. William Morell, Special
Assistant to the Secretar of Treasury for National Seclzr.ty
Affairs, and of the Intelligence Cornmranity
Staff. The fin ings and recommendations, however, are my
own and do not necessarily represent the views of the Int,,lli-
gence Community Staff or any other entity of the intell-Eal-nce
community.
5. In the appendix I discuss at some length a numbe?
of unresolved problems of a highly sensitive nature.
Accordingly, this survey is bei_ig issued in two versions.
Most recipients outside CIA headquarters building will
receive one that is ST only: it will not contain either tie
appendix or pages 25a and 25b dealing with COMIREX.
I ew ivisI on
lift el-rigence Community Staff
Attachment: Economic Intelligence Survey
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ECONOMIC INTFLLIGENCE
A Staff Survey
May 1974
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ECONOMIC INTELLIGENCE
A Staff Survey
May 1974
Background
Economic Intelligence Defined...
...and Placed in Perspective
The Indivisibility of Intelligence:
,Joint Efforts/Joint Costs/
.Joint Products
New Directions Since 1971
SECTION II. THE IDENTIFICATION OF USERS' CURRENT
NEEDS FOR ECONOMIC INTELLIGENCE
The Economic Intelligence Contribution
Today...
...and Tomorrow
National Security Council Intelligence
Committee
KIQs
KEP
Requirements Advisory Board
Economic Intelligence Committee
Director of Central Intelligence
Directive No. 1/2
Guidance to the Foreign Service
via CERP
The Annual Statement
The Economic Alert Lists (EALs)
Guidance to Intelligence Community
Collectors
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SECTION III. DETERMINATION OF INTELLIGENCE
COMMUNITY'S CONTRIBUTION Z3
The NIO/Economics et al. 23
The KIQ Evaluation Process 21
SIGINT Committee 25
Human Sources Committee :5
COMIREX 5a
Special Studies
Joint DDO/OER Study of Clandestine
Collection of Economic
Intelligence
SECTION IV. DETERMINATION OF APPROPRIATE RESOURCE
LEVELS AND ASSIGNMENT OF COLLECTION
AND PRODUCTION RESPONSIBILITIES
Role of IRAC
Supplementary Resources
CIEP Inventory...
...and Other External Research
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SECTION I. INTRODUCTION
Background
On 5 November 1971 the President directed a number of
steps be taken to improve the efficiency and effectiveness
of the US foreign intelligence community. Concomitantly,
he undertook a reorganization of the intelligence community-,
including the addition of a representative of the Secretary
of the Treasury as a member of the reconstituted United
States Intelligence Board. In an accompanying letter to
number of senior national officials, he spelled out his
rationale for promulgating these measures. This included
the attainment of "an improved intelligence product,"
entailing an improvement in its quality, scope, and time-
liness. Moreover, the intelligence community was to take
into account the greater significance of "financial,
commercial, and economic factors."
Then, on 15 December 1971, the President's Foreign
Intelligence Advisory Board (PFIAB), in a report to the
President, stated, "It is essential that the intelligence
community be reoriented to support these new national
economic considerations." A number of steps have been taker
since then to support this goal but more remains to be done
The DCI, in a memorandum to the President on 6 September
1973, enumerated the specific steps he would take over an
eighteen-month period "to increase substantially the
efficiency and effectiveness of the intelligence community.`
Objective E requires that specific steps be taken to enhance
the formulation of the economic policies of the US Governriert:
-- identify during the second quarter of FY 1974
the current needs of the users of foreign econom:.c,
intelligence;
-- determine, in coordination with other Federal
agencies, what contribution the intelligence
community can make in this area;
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- determine appropriate resource levels and,
through USIB, assign responsibilities for
collection and production in this area;
-- provide for implementation of this program
by the end of the third quarter of FY 1974.
The DCI's program, or "plan," should answer most of the
unresolved recommendations of the PFIAB's December 1971
report. It is also responsive to the Board's follow-up
Report on Economic Intelligence prepared by 25X1
on 7 December 1973. The latter report concluded with a
pertinent recommendation: "The Board should evaluate
this plan as soon as available with reference to the adequiic
of its proposed approach to satisfying the contemporary,
priority economic intelligence requirements of the U.S.
Government."
Economic Intelligence Defined...
"Economic Intelligence" is difficult to define. It ii
an abstract term that, depending on circumstances, includes
negotiating strategies, short- and long-term outlooks,
descriptive and speculative information, plant and investm-un-
data, commercial information, and a broad spectrum of rese:ar__h
analyses. Its information base encompasses the political,
military, technological, as well as the commonly accepted
economic. Its product is used by policymakers, by negotiators,
by staff planners, and by analysts of all hues.
Often economic intelligence is said to encompass all
economic, financial, and commercial information on foreign
economies. But, this neat and simple characterization
inadequately indicates the means by which economic intelli-
gence is integrated with the policy-making and implementatioL
processes. Accordingly, it is probably more useful to define
the subject in terms of the end-product. This, in turn,
comprises those studies, analyses, evaluations, estimates,
forecasts, and interpretations that are prepared by the
intelligence community in support of the formulation and
execution of US foreign economic policy. Subjects covered
include foreign trade, international investments and
technology transfers, the world monetary system, access to
fuels and other raw materials, anc traditional national
security topics such as military expenditures.
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..and Placed in Perspective
As international economic affairs have become increasingly
important to US policymakers, the demands on intelligence for
the collection, analysis, and evaluation of economic informa-
tion have broadened greatly. Traditionally, the economic
entities of the intelligence community were largely concerned
with the economic basis for threats to the United States--
in Khrushchev's words, "the means of burying" us. Today they
focus on foreign economic plans, policies, and developments
having a substantial, present or potential effect on US
national interests.
Although this new approach can include almost any kind of
foreign economic information, it is far from universal. Eccncmic
information, research, and analysis becomes economic intelli-
gence only if it is currently or potentially necessary to the
formulation or execution of US national policy. Usually excluded
are the routine collection and collation of economic data fror
the open media and research in support of private US interests.
More and more the function of economic intelligence is being
recognized as one that provides key ingredients of the policy
support package, such as:
collection of economic information not
available from popular sources;
-- analysis of economic information from all
sources specifically related to US policy
concerns.
The need for economic intelligence is less predictable than
are other types of intelligence. Some of the requirements f
economic intelligence support are reasonably stable--for example,
economic research on denied areas. But others are constantly
changing as a result of changing world market conditions and
policy concerns.
Two other points are worth noting. Economic policymaker:.,
turn to the intelligence community For non-economic-intelligence
support too: e.g., biographic information. And, of course, much
of their over-all support comes from outside the intelligence
community.
this effort have been established to meet other objectives.
is appropriate that the collection efforts be multipurpose.
Within the intelligence community, economic intelligence is
often a joint product with other intelligence.
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The Indivisibility of Intelligence: Joint Efforts/Joint
Costs/Joint Products
The second PFIAB Report on Economic Intelligence,
December 1973, notes a number of "economic" developments
in the past two years to substantiat the Board's urgent
call for more effective "economic intelligence." In parti-
cular, it cites several international currency crises, the
substantial US dependence on foreign sources of supply for
petroleum and other vital resources, the US sale of grain
to the Soviet Union, and US technology transfers to the
Soviet Union. By this juncture it should be apparent that
international economic policy is increasingly interrelated
with the national security. It should be equally evident
that export controls on US agricultural commodities and an
embargo on exports of crude oil to the United States from
the Persian Gulf area involve more than US economic relation;
with Japan and Saudi Arabia, respectively. Indeed, although
the Arab oil embargo had a wrenching economic effect on the
United States, it was in reality, a political weapon in the
hands of those who wielded it. Clearly, the intelligence
community must deal with a variety of problems that transcend
the purely economic. It must, in fact, contend with subject;
which, together, might be termed "hyphenated-economic inteli-
gence:" military-economic (arms sales , scientific-economic
(transfer of technology), political-economic (broad policies;
economic measures used as political weapons), and socio-
economic (growing population pressures on raw material resources).
In making determinations of appropriate resource levels,
intelligence program managers will have to translate national
needs in these areas of hyphenated-economic intelligence into
organizational directives. A USIB agency or department may not
necessarily need x more slots to meet the growing needs placed on
it by the Washington economic community. Instead, this requires
the recognition that requirements fcr intelligence concern:
internal and foreign economic policies, programs, and negotiating
positions; motivations and developing positions of individuals,
interest groups, and separate governmental bureaucracies; and
economic policy intentions, attitudes, strategies, and proposed
actions of key governmental and other decision-makers--all as
they relate to matters affecting US economic interests.*
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In a letter of 16 May 1973 to Admiral Anderson, Chairman
of PFIAB, the DCI, James Schlesinger, in discussing the US
economic effort, said about of the analytical 25X1
(product) resources and about of the collection
resources of the intelligence community were devoted to
economic intelligence. He stated he did not have much
confidence in these figures because they were based on CIRIS
(Consolidated Intelligence Resources Information System)
data for resources devoted solely to economic intelligence.
Nonetheless, CIRIS has again been tapped to identify the
costs related to economic intelligence, but this time with
the recognition of the relevance cf joint efforts, costs,
and products.
The National Intelligence Program (NIP) consists of
three major programs, those of the CIA, the State Department's
Bureau of Intelligence and Research, and the Consolidated
Defense Intelligence Program. The last concerns NSA, DI:A
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NIP does not include the Foreign Service of the United States,
which yieTTs' us the greatest amount of useful information,
and often at the lowest cost to the- US Government. The
appropriate data can be factored ire, however,
For FY 1974, derived from "CIRIS 1973" and combining
the NIP and the Foreign Service, those costs directly
targeted against economic subjects arel of 25X1
collection (the Foreign Service being allocated entirely tc
collection); of proce.-,sing, ? and
of production
told,
economic intelligence as a ercentage of the NIP plus
Foreign Service is Yet, these figures are
manifestly incomplete: Much of tht.~ relevant data is omittee_,
because--quite sensibly--program managers lump economic
intelligence together with political and/or military intelli-
gence.
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It is estimated that
of the NIP (plus Foreign Service efforts) is devoted either
to economic subjects or to categories of information that
include economics.* This is probably a more meaningful
depiction than arbitrarily apportioning subjects that often
cannot be separated. With this realization, the issue of
resource levels takes on new meaning and new significance.
Eventually, new organizational relationships--lending themselves
to more profitable interdisciplinary endeavors--may well
follow.
New Directions Since 1971
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Deputy Director for Intelligence (DUI), the USIB Economic
Intelligence Committee (EIC) was charged with responding
to the 0MB inquiry. This USIB committee,which traditionally
had sought membership from the non-USIB agencies and which
had always limited its focus to the communist world, would
examine issues whose major relevance was West-to-West relation-
ships.
In June 1972, USIB approved the report, which had been
drafted by a working group composed of representatives from
CIA, State, Treasury, Commerce, and the Council on Inter-
national Economic Policy (CIEP). They had started their
labor with a mutually-agreed premise:
Events of 1971 "demonstrated the crucial role that
international economic, financial, and commercial
considerations play in the formulation and execu-
tion of US policy..." So policy-level officials in
all economic departments and agencies of the govern-
ment need to be provided with the most timely,
relevant, and complete economic-intelligence support.
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Thereupon, the EIC Chairman (wno is also Director of the
CIA/DDI Office of Economic Research [D/OER]) established a
Subcommittee on Requirements and Coordination, whose purpose
is to make economic intelligence requirements more closely
reflect the interest and needs of all departments and agenc:.ee
of the Executive Branch and to achieve greater responsiveness
to these requirements. As a result, during FY 1973 the
principal recommendations it was tasked to carry out were
satisfied. (These are fully described in Section II.) Each
EIC representative of the non-USIB agencies can now receive
the classified information he requires to carry out his
responsibilities. Where necessary, additional clearances havo-
been granted. The physical facilities of each non-USIB agency
have satisfactorily passed security muster. Thus, sensitive:
intelligence information cables and reports published by CIA'
Directorate of Operations (DDO), 25X1
are now disseminated to the top
po icyma ers o e wasningron economic community.
In addition to the EIC initiatives, important measures
have been undertaken by the DCI, his Intelligence Community
Staff (ICS), Treasury, and components of the intelligence
community concerned with economic intelligence. These are
discussed in the following two sections.
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SECTION II. THE IDENTIFICATION; OF USERS' CURRENT
NEEDS FOR ECONOMR INTELLIGENCE
The Economic Intelligence Contribution Today...
The Federal government structure for expressing and respcnd
ing to needs for economic intelligence is neither coherent nor
well-organized. A multiplicity of departments and agencies par-
ticipate in the formulation and execution of US foreign economic
policy. To a large degree, this fragmented market determines
the intelligence community's unstructured service: economic
reports and analyses flow from the intelligence community to
consumers at all levels via a host of channels. NSA, State,
CIA, and to a lesser extent Treasury and DIA distribute field
reports directly to many of the same officials who subsequently
receive "finished" intelligence analyses, often based, at least
partially, on those same field reports.
At the national level the principal councils eliciting
intelligence support are the National Security Council (NSC)
and the Council on International Economic Policy (CIEP), the litter;
until recently, falling under the Council on Economic Policy (`EP).
Yet, central control and direction of economic policy are oftei not
evident, with the result that the intelligence community's in-
puts are often ad hoc. Additionally, the action is sometimes
in other arenas, such as the Bennett Group -- chaired by Treas-
ury's Under Secretary for Monetary Affairs -- for monetary policy,
and a steering group chaired by the President's Special Repre-
sentative for Trade Negotiations (SIR) for preparation for trace
negotiations. A further complication is that the intelligence
community is at times either excluded from, or only partially
aware of, the decision-making processes in these bodies on cur--
rent issues. Indeed, some economic policymakers are consumers
of intelligence information and analyses only reluctantly, if
As for the working levels in the departments and agencies,
they too have mixed emotions about the relevance or usefulness
of "objective" economic intelligence. The major entities en-
gage in their own research, as defined above. Not unexpectedly,
departmental loyalties and rivalries lead to less than full ex
change of information and analyses from non-USIB to USIB agencies
and among the former. For example, observations of Treasury
attaches often are given either very limited or no distribution
outside of Treasury. Still, most of the agencies and groups
involved with economic intelligence recognize that they have
information needs in common, although for different analytical
purposes.
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The White House family of EIC participants, especiall,r
CIEP, STR, and the Council of Economic Advisers (CEA), has
little or no research capability. Therefore, they more
readily turn to the intelligence community, in general, and
the CIA's Office of Economic Research, in particular, for
analytic support.
Of course, the great bulk of the basic information base
is available from reports originating in US posts abroad and
from open source materials. All members of the Washington
economic community, USIB and non-U,,;IB alike, rely heavily on
field reporting and analysis based on personal contacts in
official and private circles. National Intelligence Estimates
(approved by USIB and issued by the DCI) and study memoranda
(NSSMs and CIEPSMs prepared under the direction of NSC and
CIEP) are the products of interagency efforts and often cont.in
an economic intelligence input. In most instances, however,
contributions to international economic policy issues take tle
form of memoranda prepared in Washington in response to spcec.~fic
requests.
Over the years, CIA's OER, which has the major portion ciT
the intelligence community's analytical resources and which
accounts for the bulk of the output in economic intelligence
production, has disseminated its finished intelligence memc~ri_nda,
on the one hand, to specific high-Level consumers as so-called
S-projects and, on the other hand, to a wider audience as _n.
telligence Memoranda and Reports. In 1973 this Office introcuced
the Intelligence Brief, in reality an upgraded S-project, ,.nc
two weekly publications that receive broad dissemination Ii:
Washington and selected dissemination overseas: The Econolrtcic
Intelligence Weekly and International Oil Develo ments. TIT
to , about 70 per cent of s T.nis e intelligence procuc-
tion responds to specific requests, and much of the remainc_er
bears directly on policymakers' obvious needs. Indeed, the?
International Oil Developments was instituted in response to a
specific NSC request that arose from CIA attendance at an nier-
agency NSSM meeting. For the most part, then, the analytica'
requirements system has developed informally through direct
contacts between producer and consumer. In an unstructurec
policy environment, an informal network is the most utilityran:
a highly structured requirements system would have little chfnce
of success.
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What has been said for OER applies in the main for the
other analytical entities of the intelligence community.
State/INR has only about one-fifth of OER's economic resources.
CIA's Office of Strategic Research and DIA concentrate ex-
clusively on the military-economic area (transportation and
military expenditures). Treasury's Office of the Assistant
Secretary for International Affairs (OASIA) has a small research
staff, performing basic analyses of balances of payments and
other economic topics. Its policy officers, however, do con-
tribute to a number of office publications, one of which receives
relatively broad dissemination. OPSIA's "WEEKLY HIGHLIGHTS"
is sent to named addressees at State, AID, Commerce, Agriculture,
OMB, CEA, FEA, Export-Import Bank, and CIA. While Treasury's
National Security Affairs staff (OIcS) participates in the &'II'
process it has only a minimal research capability. It currently
acts as an intermediary between other elements of the intel-
ligence community and the CEP member agencies.
Lastly, a word about current economic intelligence. In
January 1974 the DCI instituted on a trial basis the National
Intelligence Daily (NID). Less than 40 copies are disseminated
to the most senior policymakers of our government every day bit
Sundays and holidays. Economic consumers include the Secretary
and Deputy Secretary of Treasury, the Director of OMB, the
Executive Director of the Council on International Economic
Policy, and a senior staff member of the National Security
Council. In most instances, the material related to economic
issues is carried in the National Intelligence Bulletin as wetl,
which reaches a national audience six times each week.!
On occasion, DIA's Intelligence Summary and Daily Intelli enc=
Bulletin, published six times per week for t e de tense es r sh-
ment, carry items on foreign military sales. State's Burea-.x ?f
Intelligence and Research (INR) devotes its current support tr:
in-house consumers in the form of Intelligence Notes and
Intelligence Briefs, only a small number of which are prepa?e<
by its Office of Economic Research and Analysis. In addition.
as indicated earlier, CIA's DDO issues Intelligence Informatuinn
Cables--even those that are sensitive--disseminating them, .1 is
State's traffic, to a growing number of senior policy offic.a:s
in the Washington economic community.
A rehearsal of the variegated means the intelligence
community employs in an attempt to target its production to
the needs of the policymakers--and it is a moving target--
does not complete the loop. Mr. Cherne, in the December l9',:$
PFIAB report, notes, "...one of my most disturbing observations
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is the near-total absence of the evaluative feedback from the
user to the producer." Steps have been and are being taker
to respond to this criticism. High-level guidance is useful.
and evaluative feedback sorely missed. But, on a day-to-day
basis, continuing, largely informal, direct customer contacts
will remain the practicable mode of conducting business.
..and Tomorrow
As will be outlined below, this paper proposes the
adaptation of two interconnecting mechanisms to relate the
economic policymakers and the intelligence community: the
National Security Council Intelligence Committee (NSCIC),
including its Working Group, and a reoriented Requirements
Advisory Board (RAB). High-level representation will be
provided as applicable by the key economic policy entities cf
our government--Council on International Economic Policy,
Council of Economic Advisers, and the departments of State,
Treasury, Commerce, and Agriculture, as well as by those
concerned with trade and financial flows, and the continuinc
"energy challenge." Agriculture, for example, would be
invited to join in any of the deliberations on shipments of
feedgrains to the Soviet Union. And CIEP would participate
in any NSCIC discussion of the Key Intelligence Questions
to assure that worldwide interrelationships, both regional
and functional, are considered.
The largely informal network of producer-consumer contacts
will be supplemented by formal links with policymakers in order
to gain more timely guidance and better feedback. In particular,
the intelligence community, probably represented by the new
National Intelligence Officer (NIO) for Economics, should gain
observer status on the Bennett Group, the successor to the
Volcker Group. (So long as the United States engages in
international monetary negotiations, it is likely that it will
require such a high-ranking body to determine policy on inter
national monetary issues.) As a prelude to policymaking, it
engages in evaluations; for instance, an examination of various
proposals for monetary reform. The intelligence community can
make a useful input here by providing insights into the
thinking of similar groups in other countries as well as
estimates of likely reactions to our proposals once they are
surfaced.
The National Advisory Council on International Financial
and Monetary Policy (NAC) is chaired by the Secretary of the
Treasury and includes the Secretaries of State and Commerce,
the Chairman of the Board of Governors of the Federal Reserve
System (FRB), and the President of the Export-Import Bank.
It was established in 1945 by the Bretton Woods Agreement
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Act to coordinate the policies and operations of the US rep1e-
sentatives on international financing institutions such as
the IMF, and to review the transactions of the Export-Import
Bank, among other functions. For the most part, the work of
the NAC and its subordinate structure is of an operational ralure.
It does, however, from time to time engage in analytical work,.
Moreover, it submits an annual report to the President and to
the Congress, whose main purpose is to discuss in some depth
specific international monetary and financial policy issues.
The NIO/Economics and the Treasury's Special Assistant to tie
Secretary for National Security Affairs should explore with tie
Director of the NAC Secretariat the utility of ad hoc representa-
tion by the economic intelligence community. To date, the IF:I
and the Export-Import Bank have only very loose ties with t1c
intelligence producers,
With the cooperation of State and Treasury/ONS, OER is ncw
producing monthly a chronology of upcoming action-forcing everts
in the economic area that may require intelligence support. it
the same time, this Office is increasing its interdisciplinary
meetings with analysts of other components of the CIA, e.g., (f-
fice of Scientific Intelligence. In the coming fiscal year, in
concert with the NIO/Economics, this Calendar of Economic Everts
can be utilized to broaden such meetings to include t eir ccurte-r-
parts in other intelligence organizations.
The NIO/Economics will by the DCI's principal staff offic-r
in the economic field, operating through command channels to
stimulate collaboration of all elements of the intelligence
community on substantive problems. He will also participate
in the maintenance and establishment of customer relations
and consultant assistance, and in the definition of objectives.
And working in concert with the Intelligence Community Staff,
he will assist in the evaluation of performance and so make
an impact on resource allocation and management decisions.
A major contribution of the NIt)/Economics will be to org,,
at least in part, gathered by irregular means, i.e., clandestine
sources and codeword materials.
Action to Date. -- During the spring of 1973 the memb./r
achieved a consensus on the two international economic problem,
that they did not believe were receivin ade uate coverage.
On 15 May 1973
the full Board and Secretariat, convening in the White House,
formally approved them. The members also agreed that the
process would be an ongoing one and over time they would exp-/Y.
to address themselves to additional requirements of similar
caliber. Because RAB believed that additional collection was
necessary, the requirements were forwarded to DCI Schlesinger
by Dam. Later, on 29 June 1973, they were passed on to the
Director of NSA for his comments (see below). At the same
time, these requirements were incorporated into the formul$tLo
of the first set of economic KIQs.
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Hart left government the following month and, since tt.er,
his successor, William Morell, ha-chosen to canvass the
membership on an informal basis. But, 25X1
in his recent economic intelligence report, notes that "tie
Board's 1971 report recognized the need for an institutior.a
mechanism capable of articulating the intelligence require-
ments of U.S. economic policy-mak.-ng organizations.. .the
RAB...appears organizationally well suited to satisfy thi!
purpose."
Proposed Action. -- There is general agreement with
that there is a need for a RAB-like mechanism. Even
though international economic pol-cy is increasingly inter-
related with the national security, NSCIC by itself cannot
and should not fill the void. Not all high-level economic
objectives should be brought to the attention of it or it!
Working Group. Many financial, commercial, and trade
matters would have little interest to them. Yet it is
e uall true a complete bifurcation 25X1
would hEve
significant drawbacks. Economic matters that have nationi.l_
security implications might not come to the attention of 1h<
non-economic agencies who have a 'need to know."
The purview of a rejuvenated RAB will no longer neces:?a~ily
be limited to covert intelligence matters. Foreign Service
reporting, in particular, will be scrutinized too. When t:hu
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RAB makes a recommendation on a matter that has national
security implications, its chairman will have the option o3
recommending that it be placed on the agenda of either the
NSCIC or its Working Group. This ;approach not only will
result in "exposure" for important economic intelligence
requirements but also will tend to provide a needed blend
of security and economic inputs wiih respect to intelli
gence.
Insofar as RAB's organization LS concerned, the naming
of a new chairman and new executive secretary or executive
director will be deferred until the summer, by which time
the NIO/Economics will have been on board for a reasonable
period. More importantly, the link between RAB and EIC
will have to be made clear. Such determinations will enta-
definitions of the respective roles of the EIC Chairman,
the DCI's NIO/Economics, and Treasury's Special Assistant
for National Security Affairs, all of whom will have princ:Lp.tl
parts to play. In any case, the RIB charter membership wi.Ll
undoubtedly be augmented by ad hoc invitations to representst.ves
of the other economic agencies and departments, e.g.,
Agriculture and FEA, as appropriatae.
Economic Intelligence Committee
As indicated in the introduction, USIB's Economic
Intelligence Committee has been the principal institutional.
mechanism in this field since early 1972. During this two-
year period much of the basic spadework has been completed.
The concerned agencies are now able to consider further
measures, including those enunciated in this plan. As for
the topic of this section, users' current needs, the BIC
is performing and undoubtedly will continue to perform a
singular role with respect to DCID 1/2 and providing gui-daiz:_
to the Foreign Service. Moreover, it soon will strengthen
its experienced secretariat--the ICS Economic Support Offi e
has been designated Executive Secretary of the EIC--so that
the EIC can get similarly involved with respect to NSA, and
eventually, perhaps, CIA's DDO.
Director of Central Intelligence Directive No. 1/2
DCID 1/2 establishes US Foreign Intelligence Priorities
in accordance with NSCID No. 1. In contradistinction to the
KIQs, which apply only to matters of policy-decision interest.
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during the present fiscal year, the comprehensive topic/
country/priority matrices in the Attachment to DCID 1/' are
intended to provide over-all guidLnce for intelligence plarLring
and resource allocation in the FY 1975-1979. Thus, the DCII
is a listing of intelligence of longer term or continuing
importance or interest to civiliai and military users of
intelligence.
Action to Date. -- That portion of DCID 1/2 concerned
with economic intelligence was discussed with the EIC Chair-
man at the time of its annual review during the winter of
1972-1973 to assure that the interests and needs of non-
USIB agencies were considered in its preparation. The EIC
Subcommittee on Requirements and Coordination, through a
working group composed of the members from Commerce, State,
Treasury, and OER, was intimately involved in the on-going
effort of the DCID 1/2 Ad Hoc Working Group (chaired by a
senior officer of the DCI's Intelligence Community Staff)
to update the directive.
The economic topics were completely rewritten. The
revised DCID of March 1974 contains nine of them under three
sub-categories: Economic Policy and Motivation (internal
and foreign economic policy, and dynamics of economic-poll.-y
formulation), Business Activities and Competition.(busi:ness
activities and conditions, competitive commercial threats,
and activities of multinational corporations), and EconomiF:
Capabilities and Vulnerabilities (economic data and trends,
economic capabilities, new technologies and products, and
economic vulnerabilities). As a result, the present direct -e
clearly reflects the continued increase in the priority of
economic intelligence for national policymakers as well as
making the economic topics more pr-cise and complete.
Notably, where the preceding directive had no items rated o
critical importance to US political, economic, and military
interests, the current directive has 29 topic/country scores
of "2" in the Economic category.
Proposed Action. -- DCID 1/2 calls for an annual rev-ol,
of the intelligence topics and their priorities. Presumably,
a task force will be assembled this summer to make revisions
by December 1974, with the view of ooublishing the next vers-rat
early in 1975. The NIOs will be ac-ively engaged in the
exercise, and the deliberations of he RAB will doubtless he
reflected in the EIC inputs.
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Guidance to the Foreign Service via CERP
The Combined Economic Reporting Program (CERP) of the
Executive Branch is administered and coordinated by the
Foreign Economic and Commercial Reporting Division (REP)
of the Bureau of Economic and Business Affairs, Department
of State. It provides a vehicle through which central coo--
dination is maintained over the economic guidance and
requirements levied on Foreign Service posts by many Washi-lig`:on
departments and agencies, most of which are not members of tie
intelligence community. The program encompasses schedules a,.d
ad hoc requirements, the procurement of publications on
foreign economies, and voluntary reporting. According to to
OMB staff report on Commercial and Economic Representation
Abroad, January 1973, CERP "has always been far more sensi:ire
to external constraints, primarily budgetary, than to any
attempts to determine needs objectively ...A...useful provi-ii n
would be a centralized mechanism for approving specific
requests in the light of the stateinent of needs." This
mechanism is now in being: The secretariat of the Sub-
committee on Requirements and Coordination of the Economic
Intelligence Committee annually produces a coordinated
worldwide statement of priority economic, financial, and
commercial requirements of the Washington economic community
and tri-annually eight sets of regional Economic Alert Lists.
The Annual Statement
Action to Date. -- On 14 March 1973 the first
"Coordinated Statement of Priorities on Economic, Financial
and Commercial Intelligence Requirements Worldwide of the
Washington Economic Community" was sent to all diplomatic
and consular posts and missions by the Department of State
(A-2251; Confidential). It set forth a list of broadly
applicable, general priority subjects:
Twenty
one different components of the Washington Economic Communit,,
coordinated this document.
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Proposed Action. -- The EIC Subcommittee will shortly
issue this year's statement. In so doing, it has taken in-,o
account the comments that Treasury's USIB representative
provided the DCI On 23 November 1973 on the draft of Key
Intelligence Questions. His comments were based in large
measure on conversations with members of the Council on
Economic Policy and other key economic policy officials.
The Annual Statement provides an additional means for
notifying the field of their concerns.
The Economic Alert Lists (EALs)
Action to Date. -- The economic sections of CIA's
Current Intelligence Reporting Lists have been broken out
and expanded to include contributions from all the sub-
committee participants and renamed. The EALs are the vehicles
through which Washington economic analysts maintain a
continuing dialogue with the field reporters. The analysts
identify specific short-term gaps in their information
picture, make requests for amplification of topics already
being reported and suggestions for emphasis, and express
needs that are within the reporting responsibility of one
given collector.
At the time the EAL was launched, a sister document,
the Economic Reporting Guide (ERG), was founded to parallei
the CIA's Intelligence Reporting Guide. Like the EAL, the
ERG was published in regional editions, but only on an
annual basis. Its purpose was to express Washington analyst:;'
general and long-term reporting needs, information needs of
a current but continuing nature, and requests for periodic
reporting. After a year of trial and, after receiving the
comments from a sample of 30-odd posts, the decision was
made to drop the ERG. Many of the continuing information
needs were duplicative of those identified in the corresponding
EAL. As for the long-term reporting needs, Volume 10
("Economic Affairs") of the Foreign Affairs Manual (FAM) is
now undergoing revision; it will-be reissued in June 1974
and will incorporate the suggestions of Treasury's Office
of the Assistant Secretary for International Affairs.
Continuing steps have been taken to improve
the
Economic
Alert Lists. In response to the recommendations
of
a
representative sample of ambassadors, the items
have
been
reduced in number and sharpened in focus. This
has
been
accomplished through the use of eight substantive review
panels composed of specialists from CIA, State, Commerce, an,
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Treasury. Currently, the regional affairs sections identify
those national policy issues requiring intelligence support
that dictate priority collection and reporting. For example,
the Middle East/Southeast Asia EAL, March 1974, requests the 25X1
posts to focus on the following areas of economic informatior:
Proposed Action. -- A relatively recent publication,,
the EAL is current, topical, selective, and specific. Yet,
it is a guidance document rather than an "instruction,"
which requires a mandatory response from the field. Individual
collectors may determine in view of their local situation the
manner and extent, if at all, to which they respond to EAL
items in their formal program of reporting. This subject,
worthy of more discussion, quickly leads into the subject cf
resources; because in general, the field response is a
function of its work load. So that such a discussion, which
would include OMB, will be meaningful, the EIC SubcommitteE
this summer plans to commence an evaluation of the EAL
responses. At present, CIA's Central Reference Service is
coding them in its "Aegis" information retrieval system.
Often, however, the post does not slug the incoming message
with the acronym EAL. Hopefully, over time, they will do Eo.
Depending on information needs and priorities, the
periodicity and area coverage of the various area EAL
volumes may change from time to time. Thus, for example,
in January 1974 the Far East EAL was split into two
books: (a) Southeast Asia and the Pacific, and (b) China anc
North Asia. In due course, this flexibility will enable tie
NIOs to make an appropriate input.
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Guidance to Intelligence Community Collectors
Collection tasking for CIA's I)DO, NRO, and NSA, is
provided by three USIB committees: the Interagency
Clandestine Collection Priorities Commitee (IPC), the
Committee on Imagery Requirements and Exploitation (COMIREX),
and the SIGINT Committee, respectively. Thus far, the ETC
has only indirectly participated in the formulation of
requirements for the IPC, and not at all with respect to
the other two. Meanwhile, separate flows of stated economic--
related requirements are fed into each of the three by
separate CIA, State, and Treasury representatives. So that
the collectors can be provided with an authoritative judg-
ment of their relative importance and so that they can be
systematically prioritized, the ETC will take the initiative.
In so doing, the EIC Chairman, for the first time, will be i}
a position to note the many interrelationships among the
various collection systems, overt and covert alike. This
is a necessary first step, moreover, in "optimizing" the use
of the overt system, which is cheaper, with respect to costs
and risks.
Action to Date. -- The Executive Secretary of th3 ~iIC
Subcommittee on Requirements and Coordination is also a
member of the IPC. In this capacity, from time to time,
he has brought before the committee those requirements
submitted by non-USIB agencies for the Economic Alert Lists
that may be appropriate for clandestine collection.
Proposed Action. -- As noted, the ETC Secretariat will
be strengthened in FY 75, so that it will be able to perform
the function of providing the USIB tasking committees with
coordinated, prioritized collection requirements. The various
agencies and departments that now submit their needs to NSA
and DDO directly when they have an urgent matter will continue
to do so on an ad hoc basis; but this procedure will become
the exception. Additionally, the FIC Secretariat will now he
able to monitor such special queries so that lines will not hf-
inadvertently crossed and duplication of guidance will be
minimized.
The BIC will work closely with the appropriate committee--.
that are already engaged in requirements work, especially
the SIGINT Committee. This committee, and not the Director
of NSA, has the ability to task all SIGINT sensors. Finally,
during the course of FY 75, the relationships among, and tie
operating procedures and functions of, the BIC, RAB, NIO/
Economics, and ICS Economic Support Officer will be clarifie.l,
the aim being to achieve a more efficient, timely performance'.
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SECTION III.
DETERMINATION OF INTELLIGENCE COMMUNITY'S CONTRIBUTION
As noted on page 1, Objective L requires that this step
be taken in coordination with other federal agencies. The
implication is that not all the "economic intelligence" as
we have defined it, which is required by national consumers,
is to be a task for the intelligence community. In a period
of budgetary retrenchment, we should, in particular, optimize
the use of the Foreign Service for collection purposes.
Moreover, the answers to many requirements might well lie
within the public domain, or could be met by an able economic
research facility. In sum the, this section is the bridge
between users' needs and a determination of appropriate
resource levels for the intelligence community.
The NIO/Economics et al.
Early on, the newly arrived NIO/Economics will
concern himself with the limitations of covert activities
directed against economic targets, particularly in the Free
World. Not only is this a costly way of conducting business,
there is a political risk in operating against countries
that historically we have considered our friends. In the
present climate such efforts should be made only on a selective
basis. Decisons of this nature, however, should only be
made when it is already apparent that the overt collection
capabilities of the departments of State, Treasury, and
Agriculture have been exhausted. The use of the RAB
mechanism -- with the NIO playing a key role -- will enable
the intelligence community's managers to judge the degree
to which requested intelligence support involves sensitive
information.
The December 1973 PFIAB report recognizes that the
Foreign Service officer is basic to economic intelligence
collection.
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Indeed, the bulk of recent additional "economics" slots
granted State by OMB, as a follow-up to the latter's staff
report (see page 19 above) have been awarded to export
promotional activities. It is becoming evident, therefore,
that high-level intercession may be required. In the mean-
while, this subject should be placed on an early agenda of
the NSCIC Working Group, with the aim of eventually bringing
it to the attention of the Deputy Secretary of State. Pari
The Intelligence Community Staff -- especially its
Economic Support Officer -- will also play a major role in
this process. In particular, as it develops objectives for
community components and organizes studies and evaluations
of their performance, the IC Staff will be affecting per-
ceptions of the intelligence community's contribution. In
effect, the ICS Economic Support Officer will perform as the
managerial counterpart to the substantive NIO/Economics.
Together, acting in complementary fashion, they will support
the DCI under both his USIB and IPAC hats. A number of
joint projects are already under way; viz., the KEP and two
special studies, which now will be discussed.
The KIQ Evaluation Process
The KIQ Evaluation Process (KFP) was set in motion in
mid-February 1974, on a pilot run. As has been noted, of the
twelve KIQs selected for the initial exercise, two relate to
the oil problem. Once the Baseline Reports are completed,
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they are simultaneously sent to CtA, DIA and INR, and three
USIB committees, the SIGINT and Human Sources committees,
and COMIREX. These committees, in turn, will concern them-
selves with rectifying the information deficiencies identified
in the Baseline Reports. As the process proceeds, the NIC's for
Economics and Energy and the program managers will in microcosm
be addressing the question of what the intelligence commuritv's
contributions can and should be to meet the stated users' needs.
Over time, as experience is gained, it is planned to employ this
procedure for an ever-widening range of issues.
In March 1974 its Intelligence Guidance Subcommittee
identified the possible resource i.mpact on theFY 76-80
consolidated cryptologic program, giving heavy emphasis tc
NSA's intelligence support for economic matters. Over time.
the SIGINT Committee will be requested to provide active
assistance to the Economic Intelligence Committee in response
to the finding noted by Mr. Cherne, namely, "there remains
perception of gross inadequacy regarding the guidance for
COMINT tasking on the part of NSA itself as well as by otI'eis
in the Intelligence Community who feel more could be done b\
this agency."
The Annual Report of the Cenral Intelligence Agency
for FY 1973, 1 November 1973, includes a listing of over-
all objectives of each of its directorates. The objective
that is relevant here calls on the DDO "to produce reports
of value on the plans, policies, and internal stability of
Free World or Third World countries."
one e ess, and
this can stand repetition, such collection efforts are
undertaken only if the information required is not normally
attainable by overt or diplomatic means. Having said that,
and realizing that State reporting and open sources provide
much of the information needed for policy-oriented economic
research, there are specific areaL, in which only clandestine
sources can provide the necessary inputs to round out the
analysis of a problem area. Most often, these involve a
foreign government's plans and intentions. Normally, targets
with access to the required information are in the appropriate
ministries (finance, economic, trade, food, and energy), or
high government councils such as cabinets.
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II
Special Studies
As is readily apparent by this time, the economic
intelligence producers have many links with the policy
consumers, much of the "network" having been set up only
within the past several years. Wth the new emphasis on
economic reporting, needs were soon followed by the
necessity of developing collection strategies. Thus, it
was natural for OER, the principal analytical shop, to
take the lead. It is currently evaluating applications
of overhead photography, especials.y with respect to crops.
And the drafts of two studies concerned with covert reporting
have just been completed. Their findings should be oft
value to the resource managers and should point the way
for future study.
Joint DDO/OER Study of Clandestine Collection of
Economic Intelligence
In the spring of 1973 the DCI suggested that an
informal committee composed of senior representatives of
the DDO divisions and OER be established to examine the
role of clandestine collection of economic intelligence.
The joint study was launched some months later. It takes
into account both the policymakers' needs and the realities
of utilizing clandestine sources. It will be reviewed and
emended by the NIO/Economics. Thus, when revised, it should
assist the DCI and the DDO in making decisions that will
determine the allocation of clandestine collection resources
for economic intelligence over the next several years. It
is, of course, not possible to provide any single list of
priority needs that would satisfy all the demands of the
analysts. Nonetheless, there are areas of priority concern,
and OER's input to the study identifies these:
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In the real world, of course, risks of exposure cannot
be set aside. The NIO/Economics, the DCI's representative,
will provide strong and centralized direction to the DDO on
the national requirements for clandestine economic collection.
The KEP will allow him to review all the international economic
intelligence operations of the US Government; in addition,
the EIC and RAB will provide him with the judgments that shoild
enable him to balance risk against probable return. Once it
is determined the national need is worth the costs and the
risks, the NIO/Economics will work with the DDO area divisions
to sharpen their objectives. Until this is done, substantial
uncertainties will remain as to the exact role of clandestine
coverage of the economic scene.
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DETERMINATION OF APPROPRIATE RESOURCE LEVELS AND
ASSIGNMENT OF COLLECTION AND PRODUCTION RESPONSIBILITIES
The validation of collection and production req_uiremert
is undertaken by USIB on a continuous basis. The community
program managers then assume these as responsibilities. Nc%
that the intelligence community is seriously constrained
with respect to financial resource., it more than ever has tc
weigh the relevant opportunity costs before it embarks on
new efforts. To take on an additional job, an old one may
have to be stopped. Accordingly, the appropriate resource
level for each intelligence function must be determined.
Conceptually, this can be done by completing programmatic
and topical resource studies, so that the resource levels
can be allocated among the intellience entities.
Role of IRAC
At this time, we can start onEy with the first part of
this objective. And "determination" is a misnomer; the
proper word is "examination." As ~;uccessive iterations of
substantive objectives are issued and refined, we can look
forward to achieving the second portion of this objective,
in fiscal years 77, 78, and 79. The principal mechanism
the DCI will employ to fulfill thi, all-encompassing task
is his Intelligence Resources Advi_;ory Committee (IRAC),
which he chairs, and which includes senior representation
from the departments of State and Defense, OMB, and CIA.
Over time, there may well be a com-_ng together of the USIB
and IRAC functions -- substantive natters and resource
matters are intertwined.
By definition, "hyphenated" economic intelligence cut.
across program lines. Rational planning of economic intel-
ligence is not possible without considering the capabilities
of all the collection and research efforts of the governmenr:
intelligence and non-intelligence alike. At the present t--m(
we are faced with a constantly mov..ng target: with respec'
to US economic policy, the concerns, and therefore the
appropriate roles of economic intelligence, are changing v.c"
rapidly. As a result, resource planning in this field, wh:lu
necessary, is very difficult. Nonetheless, much can be dome
For example, some elements of economic intelligence are more
predictable than others. Most predictable are the requirerierts
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for collection and research on the US;.R and China. The
near certainty that these nations wil_',,, remain, despite detente.
basically antagonistic to the United '~tates, and closed to
foreigners, means that intelligence w_ll have a major role in
evaluating Soviet and Chinese economic capabilities and
policies.
Action to Date. -- In March 1974 IRAC charged its
working group to look at the total NIl, using CIRIS. To
carry out this charge, the working group plans to examine
the NIP by commissioning "cross-program" resource studies,
e.g., SIGINT. The Economic COMINT Collection Study cited
above (page 27) would be one of several inputs into such an
exercise.
Proposed Action. -- Were IRAC tc; complete an assessment
of the total SIGINTpackage, we would have a much clearer
understanding of those resources, including overhead sensors,
that could be retargeted to meet the high-level needs of
"hyphenated" economic intelligence users (if the priorities
were awarded). In practice, however, this is probably chewing
off too much at once. An examination of the early returns
from F_ I ight be more digestible.
This more limited e successfully concluded
in the second half of FY 75. By that time, IRAC will be in a
position to draw up the terms of reference for a topical
(rather than a functional) cut at the resource problem, this
time, perhaps, looking at political-economic collection.
It would be undertaken in FY 76, when the relationships among the
NIO/Economics, EIC, and RAB will have been sorted out. And
it would include all the NIP resources allocated to economic
intelligence collection broadly defined plus the appropriate
activities of the Foreign Service. Resources would be identifiel
with respect to target areas, subjects, investment, operational
costs, and productivity. Hopefully, such a study would, amongst
others, reveal opportunities to reallocate resources as necessary to
improve collection vis-a-vis specific requirements.
Supplementary Resources
"Intelligence" is only one facet of a much larger
universe. Let us assume, for example, the policymakers are
concerned with the impact of the transfer of technology on
the US balance of payments. It is quite apparent that intel-
ligence should not be a focal point of the exercise though
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it will have something to contribute -- the study would have
a US orientation, with intelligence chipping in with appro-
priate foreign-country aspects. On a somewhat different
tack, yet related, i finding that economic intel-
ligence staffs have been spurred toward maximum output, with
a consequent loss of quality. For these and other valid
reasons, the analytical components of the intelligence
community will strive to minimize duplicating the efforts of
others, both in and out of the government.
CIEP Inventory...
Starting in August 1971,INR has prepared eleven issues
of the Periodic Inventory ~~of U.S._ Government Studies for the
CIEP Operations Group. is main-f-oc is i on in House, thong
not excluding external_,research. It is a worthwhile endeavor
and should not only be continued but upgraded.
Action to Date.-- In it OER reveals its on-going economic
research program. Indeed, this is t=ie only inventory of
government-wide studies to which the CIA contributes. The
inventory covers studies under 29 major categories ranging
from natural resources to US economic relations. On more
than one occasion, non-USIB agencies deferred or abandoned
a proposed project once they spotted an on-going OER or INR/
REC study.
Pro posed Action.-- On a low-key basis, the EIC will off3r
to conduct annual sessions at which the Agency Action Officers
will discuss their research programs, making suggestions that
should reduce duplication of effort. In effect, the EIC staid-
ready to operate as a clearing house for this exercise. In
time, hopefully, before the intelligence community is commisii-n
ed to complete analytic studies by senior-level economic polic--
makers, a judgment will be rendered whether or not studies
already under way will either suffice, or satisfy part of the
problem. Such judgments, inevitably, will be a function of
the effort that goes into the preparation of the inventory.
...and Other External Research
INR also prepares seven related volumes for the Under
Secretaries Subcommittee on Foreign Affairs Research (USC/FAR)
Its aim is to further closer coordination of government re-
search. For a number of reasons neither DOD's Advanced
Research Projects Agency (ARPA) nor ~_-IA makes inputs to the
exercise.
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Action to Date.-- Recently, the IC Staff establishes
a position for a Coordinator of Ixternal Research(who will
also monitor development of new analytical methods and
techniques). An example of how he serves the producers
will be instructive.
This past fall PFIAB raised the problem of covering
Soviet economic activities in the United States, which
includes the subject of scientific and technical exchange
with the USSR and the degree to which the USSR is exploit-
ing the relationship. At the same time, a USIB member
asked the question, "What impact will greatly expanded
trade have on Soviet military capabilities over the long
term?" It is evident that these two topics are associated.
It is also evident that much work directly related to these
topics is being accomplished in many quarters. Only after
a check by the ICS Coordinator was it determined that AREA
has a sizable contractor effort dealing with the impact on
the DoD of exchanging technology with the Soviet Union (and
academia in the field of technological innovation, some
of which is germaine to the subject.
Proposed Action.-- The NIO/Economics and the Coordinator,
working together, will provide guidance to contract managers,
e.g., ARPA,so that the contractors' work will meet the needs
of a wider government audience. At the same time, they will
alert the analytical community, via the EIC, to the external
research activities under way that, in due course, might
well be of use to them. Correspondingly, the FIC will con-
sider reviewing the FAR volumes to determine whether its
clearing-house operation for in-house government research
would benefit from a participatory role in the external
research world.
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0
Action to Date.-- Recently, the IC Staff established
a position for a Coordinator of Ixternal Research(who will
also monitor development of new analytical methods and
techniques). An example of how he serves the producers
will be instructive.
This past fall PFIAB raised the problem of covering
Soviet economic activities in the United States, which
includes the subject of scientific and technical exchange
with the USSR and the degree to which the USSR is exploit-
ing the relationship. At the same time, a USIB member
asked the question, "What impact will greatly expanded
trade have on Soviet military capabilities over the Icing
term?" It is evident that these two topics are associated.
It is also evident that much work directly related to these
topics is being accomplished in many quarters. Only after
a check by the ICS Coordinator was it determined that ARF4
has a sizable contractor effort dealing with the impact cr
the DoD of exchanging technology with the Soviet Union fans
academia in the hie o technological innovation, some
of which is germaine to the subject.
Proposed Action.-- The NIO/Economics and the Coordinator,
working together, will provide guidance to contract managex_;,
e.g., ARPA,so that the contractors' work will meet the neecs
of a wider government audience. At the same time, they will
alert the analytical community, via the ETC, to the external
research activities under way that, in due course, might
well be of use to them. Correspondingly, the ETC will ccr-
sider reviewing the FAR volumes to determine whether its
clearing-house operation for in-house government research
would benefit from a participatory role in the external
research world.
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