DEPUTY CIA DIRECTOR FRANK CARLUCCI: ADDRESS TO KEYSTONE CAPITAL CHAPTER OF AFIO

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00901R000100190004-6
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 10
• Document Creation Date: December 14, 2016
• Document Release Date: August 6, 2001
• Sequence Number: 4
• Publication Date: March 10, 1979
• Content Type: SPEECH

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PUBLIC AFFAIRS STAFF
DEPUTY CIA DIRECTOR FRANK CARLUCCI:
ADDRESS TO KEYSTONE CAPITAL CHAPTER OF AFIO
Harrisburg, Pennsylvania
Saturday, March 10, 1979
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CHAIR: ...and distinguished award, not only from
the Defense Department, but also the Health, Education and
Welfare and the State Department.
I imagine that most of you saw the article in U. S.
News & World Report not too long ago, about five weeks ago,
to be exact, which, in essence, stated that when Mr. Carlucci
spoke, the President listened. So with the world explosive
situation that we have today and with the threat, a potential
threat to the security of the United States, I don't believe
there is anyone who's better qualified to tell us about the
world political situation, the intelligence community and what
is happening in Washington, D. C.
Ladies and gentlemen, I present the Honorable Frank
C. Carlucci, Deputy Director of Central Intelligence.
[Applause]
DEPUTY DIRECTOR FRANK CARLUCCI: Thank you, Colonel
Welch, members of the Keystone Capital Chapter of AFIO, officers,
guests, ladies and gentlemen. It's a great pleasure for me to
be back in Pennsylvania. I always leap at invitations to come
back to Pennsylvania. I think the last time I was in Harrisburg,
people were digging themselves out from under a lot of mud left
by Hurricane Agnes. And for those of you who went through that
experience, I congratulate you all on the excellent recovery
job.
As Randy Indicated, when we look at our papers these
days, the world seems to be In a mess, whether it's upheaval in
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Iran, assassination of an Ambassador in Afghanistan, trouble in
Nicaragua, China invading Vietnam Id! Amin wobbling in Uganda,
government instability in Italy -- one can go through the whole
litany -- it seems that never in recent history have we been
faced with so many problems. And our press is filled with pro-
phecies of doom and gloom. We don't know what this upheaval
means, who's on this side, who's on that side. It's very dif-
ficult to tell the good guys from the bad guys. And there are
strange obscure wars, like the one going on between the People's
Democratic Republic of Yemen and the Yemen Arab Republic that
make people scratch their heads, but which have enormous poten-
tial importance for the United States.
The popular mood seems to be, well, whatever all this
means, it Isn't good, and that somehow we must be losing. Well,
I don't know about that. I'm not prepared tonight to give you
a net assessment. But before we toss in the towel, it might be
useful to spend a few minutes looking at the world situation as
seen through the eyes of the Soviets. How does our friend Ivan
Ivanovich see the situation as he looks at it?
First of all, he sees a leadership problem in his own
country. An aged leadership. Brezhnev is -- what? -- 71, in
ill-health. The most touted successor, Trilenko, is even older
than that. Any new wave of leadership has been discouraged.
So any way you look at it, the Soviet Union is going to have
a succession problem.
We hear a lot about our oil problem, but the Soviets
are facing an oil problem in the 1980s as well. Their oil pro-
duction is topping out in the face of increasing demand, and
they don't have quite the same options we have. They don't have
that consumer cushion that could be cut back through conserva-
tion measures. Their choices are harder ones. They have to
decide whether to cut back on exports, thereby sacrificing the
foreign exchange they need for their technology, or cut back on
shipments to Eastern Europe, risking increasing difficulty there.
Their agricultural policy has been the next thing to
a disaster. The minority groups in the Asian part of the Soviet
Union are growing faster than the European population. The popu-
lation as a whole is not growing fast enough to keep up with the
needs of the labor force. And there are, I think, consumer ex-
pectations in face of a decreasing or stable growth rate.
Even if you look overseas where people think they've
had a lot of victories, if you take a careful assessment, it
doesn't look all that well to the Soviet leadership. They
certainly have a mess on the hands with regard to China.
They're having a silly fight over a couple of islands with
Japan, which is emerging as a very strong power, as you're
all aware. The ASEAN countries are very wary of the Soviet
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Union. In Latin America, after pumping in about four billion
dollars a year to Fidel Castro, they still essentially only
Cuba to show for it. Sure, there're some targets of opportunity,
some trouble they could stir up, but not a lot more. They've
got a great target of opportunity in Africa which they can ex-
ploit, and they're very good at stirring up problems. But history
has shown that when they try and consolidate their position in
Africa, they frequently get into trouble. Look what happened to
them in Ghana, Zaire. Look what's happening to them in Guinea.
Look what happened in the Sudan, Egypt, Somalia. They've had
their problems.
Even in South Asia, where they probably had their
greatest inroads, it's not all going their way. They've done
well in Afghanistan and the People's Democratic Republic of
Yemen. But Libya is somewhat of an embarrassing ally. And
even states that are billed as Soviet client states, like Iraq
and Syria, are almost as anti-Soviet as they are anti-American.
India seems to be changing its policy a little bit too, so they've
got some problems there.
In Europe, the biggest asset is the strength of the
military force on the central front. But it's no coincidence
that the strongest communist parties in Western Europe are those
that are the most anti-Soviet. And in Eastern Europe it's really
hard to say that they've got a strong ally, other than Bulgaria.
There's ferment in Poland. Romania is openly defiant. East Ger-
many could start to secede. And they've got their problems there.
They'll have to maintain substantial military forces in Eastern
Europe to keep their control.
But all of this, all these that they may face, are
really no source of joy to us, because anybody who understands
the Soviet Union,, as many of you in this room do, know that they
are not deterred by problems, that they are very doctrinaire in
their approach. They expect setbacks; they'll take them in stride.
They can tighten their belts; they're a closed society. They can
always expand their military might at the expense of human misery.
And one thing is particularly important to understand, and that is
they view political influence as an extension of their military
power. That is to say, if they want to extend their political
influence, they need a military base to do it, and they don't
hesitate to use that military base. Which, at least in part,
explains the enormous resources that they have been devoting
to building up their military machine, about twice as much of
their gross national product as we put into our defense effort.
Their military forces have been growing at a rate of
about three to four percent a year the past ten years, in real
terms, while ours has been declining in real terms. Their ex-
penditure on their military forces, measured in dollar terms,
what the equivalent number of dollars would buy, is probably
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somewhere in the neighborhood of 35 to 40% larger than ours.
And I see no reason to expect that this will cease, even if they
do have to tighten their belts. Nor do I see any reason to ex-
pect that their expansionist policies would cease. Indeed, you
can make an argument that the current Soviet leadership is basi-
cally a conservative leadership and that younger leadership that
will come along sooner or later, possibly after some interim
leadership, may well be more adventuresome, more difficult to
deal with.
So what does this mean for the intelligence community?
It means that we are facing increasing demands on us, because,
as you're all aware, the policy-maker's decision is only as good
as the quality of the Information on which it's based. In a world
where there is strategic parity, that information could provide
the critical leverage. But the information we have to gather and
that we have to analyze is becoming very diverse and increasingly
difficult to gather. Sure, we have to continue to pay attention
to the strategic balance. The lesson of Pearl Harbor was learned
only too well. And we have to follow individual countries. But
it does no good in today's world to look at a country in Isolation.
You have to analyze regions. The experience in Ethiopia and the
Horn of Africa, the experience in Iran, the experience in Indo-
china all teach us that. Nor does it do any good just to analyze
the political situation. You have to crank in the economic and
the social factors. Indeed, it's probably fair to say that we
didn't pay enough attention in Iran to the social factors.
And there are other areas where the intelligence business
is becoming much more complex. The whole issue of non-prolifera-
tion, the SALT verification: a highly technical, complex business.
Terorism, which unfortunately is on the increase throughout the
world. The best way to stop terrorism is to know when and where
it's going to strike. Narcotics. We spend a lot of our effort
dealing with narcotics. Or economic analysis, and in particular
analysis of the world's resources, the whole issue of petroleum
reserves, a very critical element for our national security.
And then there is the question of covert action. The
President has decided, and the Congress has endorsed, the concept
that the United States should maintain a covert action capability.
Covert action, by my definition, means an effort to exert some
political influence in a clandestine fashion. It's become a
highly emotional issue In the United States, blown way out of
proportion to its actual use. It's used very sparingly. And I'm
puzzled by the people who raise the criticism. Are they criticiz-
ing our capability to have covert action because they think it's
wrong or because they think it's failed? If they think it's
wrong, why? Is it wrong simply because it's clandestine? Is
it wrong to give clandestine aid for a pro-Western democratic
government, because to give it openly might be a political Iia-
biH ty to that government? If that's wrong, why don't say that
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clandestine collection is wrong too? Because the same critics
will say, oh, they don't have any criticism of clandestine collec-
tion. The logical inference is that we shoudn't have clandestine
relationships with our KGB agents. Or if you're opposed to it
because it's failed, in many cases it's failed precisely because
of their opposition. And even so, the opposition was to the
policy and not to the instrument. And to try and take away the
instrument because you disagree with the policy is like trying
to put the U. S. Army out of business because you might have
disagreed with the landing in the Dominican Republic.
But in fact, we have so circumscribed the covert action
capability the Congress and the administration both say that we
ought to have that it has become a virtual optical illusion. The
first requirement for any covert action capability is a presiden-
tial finding and then the briefing of seven committees of Congress,
up to 140 members of Congress. That's almost a contradiction in
terms .
And the way we define it can get us into the theater
of the absurd. During the Moro kidnaping, we got a cable from
the Italian government asking if we could send a psychiatrist
to Rome to help out. I said sure. The lawyers came in and
said, no, you can't do that; that's not intelligence collection,
and, in the terms of the law, the Hughes-Ryan Amendment, that's
covert action. And to do that, you'll have to have a presidential
finding -- the President was in Brazil at the time -- and brief
your seven committees of Congress just to put a psychiatrist on
an airplane. So I called the State Department and asked them if
they had a psyciatrist, and they said yes. I said "Would you
please put him on an airplane and send him to Rome." We got
over that one.
But there are additional absurd situations. Let me
just give you a hypothetical one where we've got an agent in
country "X," and he's a general. There's been a democratic
election, and a group of generals don't like the results of
that election and they say "Let's turn it over." Our agent
comes to us and says "What do I do? Do I go with the coup-
plotters, or do I stand tall for democracy?" We say wait
a minute. Before we can answer that question, we've got to
go back, have an NSC meeting, get a presidential finding and
brief seven committees of Congress. I submit that that is
an absurd situation.
Now I'd be the last person to make an argument for
no controls. That's not may purpose to stand up here and defend
the abuses of the past. I think we can all recognize that there
were abuses, although, as congressional committees have pointed
out, the vast majority of those abuses were abuses ordered at
the policy level and not those that were initiated at the level
of the intelligence organizations. But be that as it may, there
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is a need for some control. The question is to strike a balance
between controls and effectiveness. The administration has moved
to do that through an executive order which lays down guidelines
for the intelligence organizations. The President has established
an Intelligence Oversight Board consisting of three distinguished
Americans -- Washington lawyer Tom Farmer, former Senator Albert
Gore and former Pennsylvania Governor Bill Scranton -- which is
empowered to examine charges of wrongdoing from anyone anywhere,
anyone In this room, anyone in the agencies, intelligence agencies,
CIA, [)IA, FBI, and to report only to the President.
In addition, we've taken certain internal steps, streng-
thening our inspection procedures, our grievance procedures. We've
also worked closely with the Congress as the Congress has moved
to implement very rigorous oversight. And we welcome this over-
sight on the part of our two select committees. We find that
those committees are taking their responsibilities seriously.
They're also taking their security responsibilities seriously.
And we think we can work with two committees in the intelligence
business and do it successfully.
We also think it would be helpful to have charter
legislation for the intelligence community, legislation that
authorizes our activities and lays down certain guidelines for
conducting those activities. And we are working on such legis-
lation.
Let me say a word about intelligence failures, firings
and morale. And I don't think we need dwell on this. As a
group of professionals, you all understand that the intelligence
business is not a precise science; that upheavals are very diffi-
cult to predict; that we aren't principally in the coup-predicting
business or the revolution-predicting business. We're in the busi-
ness of looking at trends, trying to give the policy-makers the
best background for decisions. But we should be paying attention
to that kind of thing.
It is true that the intelligence organizations, CIA in
particular, did not predict the dimensions of the upheaval in
Iran. But it is not true that it did not predict the growing
problems that the Shah was facing and the Increasing division
in Iranian society. But once again, you'll all recognize that
for every failure which receives a lot of publicity, we have
many successes, and, by definition, those successes do not re-
ceive publicity.
In terms of the people who have been laid off in the
CIA, a lot has been made of that in the press. The numbers have
been grossly exaggerated. They aren't 800; they're about 250.
And you all recognize that there have been reductions in force
in previous years in the intelligence community. Indeed, there's
been a continuing scaling down of the days of Vietnam. That's one
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of the things we have to live with. It's by and large passive.
But sure, it's had its effect on morale. But what really has
affected morale is not the firings or even some of the press
attacks, but it has been the principal impediment that our
people encounter in trying to do their job, because the In-
telligence community consists of some of the most dedicated
professionals that this country has to offer. And they're
willing to take some heat. But they want the tools they need
to get on with their business. And in the intelligence business
the principal tool is the ability to protect your sources and
methods. That's as important to the intelligence operative as
equipment is to the military, or credit instruments to a business-
man. Without it, there just is no rationale for an intelligence
organization, because nobody is going to confide in you if he
thinks the information he's confided, or, in particular, his
name is going to come out in some newspaper or in some congres-
sional hearing. And the simple fact is that our ability to
protect our sources and methods has eroded. It's eroded to the
point where agents are raising questions; some have dropped off;
some we've had to cut off because they've been exposed, and we
don't know what's happened to them. Liasion services are raising
questions. I think it's become a matter of broad concern that's
impinging on our overall effectiveness.
Now this problem has a number of facets. First of all,
the information the intelligence agency collects is far too acces-
sible across the government, both in the executive branch and in
the Congress. Now everybody always claims a legitimate need to
know. But it's axiomatic that the more people who do know, the
more likely the information is to leak. And with eight committees
involved on the Hill, with all kinds of agencies involved in the
executive branch, leaks are inevitable. And our case officer
dealing with his agent finds himself increasingly put upon to
make that commitment of security that he needs to make to gain
the trust of his agent.
There's a problem also within the executive branch.
We just had a very serious espionage case in CIA, as you're
aware. It was tried in Chicago. And we've got to tighten up
our own security.
Now we've got a problem with former employees who like
to take pen in hand. And if we are unable to enforce our contract,
which says that they should submit their material for review, not
censorship but review so that we can suggest that they take things
out when they impinge on national security, then we are in serious
trouble. And as you're aware, that contract is now being tested
In the courts in the Snepp case. And the issue is very poorly
understood in this country. It's not whether Mr. Snepp published
classified information. We've never said whether he did or he
didn't. The issue is who should determine what is classified In-
formation. Should it be each employee or each ex-employee? Or
should It be the agency? If every employee can determine what is
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classified or unclassified, that's government by chaos, and our
intelligence agencies won't be able to continue.
Or we have the case of the former CIA employee, Philip
Agee, who, with impunity, has been going around the world, for
years now, pointing out, sometimes correctly, sometimes erro-
neously, the names of CIA people. When put quite clearly, an
intent to pinpoint them for terrorist groups. He's now taken
to publishing a monthly bulletin in DuPont Circle in Washington,
dedicated exclusively to exposing the names of CIA people over-
seas.
Now we have laws in the U. S. government that make it
automatically a crime to reveal information from the Commodity
Credit Corporation, the Department of Commerce, the Controller
of the Currency, and some 27 or 28 other agencies. But it is
not a crime to reveal national security information unless you
can prove the intent to commit to sabotage under our atequated
sabotage laws. So we really have no weapon to deal with this
kind of thing. Indeed, we have laws that almost seem to help
our employees, such as the Freedom of Information Act, the Pri-
vacy Act. We have three people, by statute, in the CIA today
simply providing information to Mr. Agee under the Freedom of
Information and Privacy Acts. Under the Freedom of Information
Act, we spend over three million dollars a year answering some
88 requests a week. Each costs about $540.00 to the taxpayer.
We have a national security exemption, which means that what
they get in many cases is shredded paper. Some of these re-
quests come from 13-year old children. We got one from the
Polish Embassy the other day. Indeed, if the head of the KGB
were to write us, we would be required under this act to respond
within ten days or be in violation of the law.
But it's really not the workload that troubles us.
It's the chilling effect that this has on our information col-
lection capability overseas. You can argue until you're blue
in the face to a potential agent, with a potential agent in a
denied area whose life is at stake, that we have a national
security exemption from the Freedom of Information Act and
his name won't come up. But he looks at the U. S. newspapers
and sees all kind of information coming out under Freedom of
Information. And it's very difficult to convince him. Even
the sophisticated ones who understand the security exemption
will say "Yeah, but it's really the judge, not you, who makes
the final determination. And while I'm willing to put my con-
fidence in the intelligence agency, I'm not willing to put it
in a judge that I don't know."
So I submit that we have to make a greater effort....
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...interpretation. Ours is based on a specific statu-
tory responsibility to protect sources and methods. And if they
lose sources and methods, they lose information. If we lose
sources and methods, we lose information too. But in some cases,
lives are lost.
How are we doing overall? Inspite of the problems we
face, I think we're still by far the most effective intelligence
organization in the world. Certainly the KGB puts more resources
into the business than we do; it has more people. But were ahead
technically. And I think we have a far greater analytical capa-
bility. Part of the business of intelligence is bringing bad
news. And I would much rather bring bad news to President Carter
than I would to the Kremlin. So I think we have a substantial
advantage in our analysis. They are burdened by ideological
baggage.
But we really could be doing even better than we're
doing today if we can correct some of the fundamental problems
that we face. My own sense is that we're moving in that direc-
tion. I think public support for the intelligence community has
broadened. I sense it on the Hill, where increasingly we're being
asked by committees what they can do to help us. And I know that
groups such as yours are very Important in building that base of
support.
So I congratulate you on the relatively recent formation
of this chapter. And I encourage you to keep up the good work. I
can assure you that it's vitally important for the future of our
co un try .
Thank you.
[Applause.]
* * * * *
[Questions and answers not transcribed, as per request.]
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