CASEY TIED TO ENERGY FIRM'S BID FOR U.S. BACKING

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00901R000400120001-3
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 60
• Document Creation Date: December 19, 2016
• Document Release Date: October 12, 2005
• Sequence Number: 1
• Publication Date: March 31, 1982
• Content Type: NSPR

Approved For Release 2005/11/28 : CIA-RDP91-00901R0004001200
'
Af: T ~. GI:E t,.1s
...~ I3
ON PAGE lb WASHINGTON POST
31 March 1482
By Thomas?B. Edsall .?,sue 1
=
'group,' of--five-;current-and-for
mer. top federal-employes, including:
-: `Villiam.. J.: Casey, : -director- `of. the,
Central Intelligence; Agency;'owns a
company that is part of. a consortium__
seeking 'loan and-price guaranteesr
from the-U.S. Synthetic Fuels Corp; The company,- Energy-'Transition i
Corp., is the managing partner in the'
consortium. that was ? chosen last
.week by the'synfue'rs agency as ;one
of five finalists-competing fof"varjt~`
ing types.of loan and. price supports.
:The-con?ortium wants. to;'set'up? a
plant in North Carolina for the con4
-.versioir of peat into;niethanol.-
A spokesman.,?or the-;.CIA,-Dale
Peterson; said Casey, is: a.."small, din
active stockholder" in'Energy Tran-
sition and-`-'knows nothing about the.
workings of the company."..' 4
The.. othert .partners,in .ihi ..firm.
` .dministratpr Qf ~ the Energy - Re
tration; Charlee. .- Robinson, former-
deputy.secretary'of=state; Frank' G
Federal Energy Administration and
;Wiiliam'.Turner,-.former'U:S.` repre
sentative;; to ?the -. Organization foi
"Economic'- Cooperation and, Deve
.
:opment.??i* r-r~,
.g ether. during..*_the--Ford_adrninistra t
tion. During.. the .: "administration ,l
Export Import `` Bank and ' at ,;the
'State Department,as undersecretary
for.econornic'affairs. Before that, he
!was ehairmari of" the' Secuzities and
Exchange Commission.
? There is no ` suggestionof `any im
propriety_in 'connection with: Energy
Transition's'application'' `~, a..
`Fri -said "the 'five o .n roughly:
equal shares, but profits; if'and where
they occur; would be distributed: 6-1
;evenly,, the b";- going, to the""two
owners - who actively run the firm. I .The federal support would ?anc= a
They are Fri, the 'president, ~ and
Robinson, the chairman:
Casey 'did not include his interest
in: Energy-Transition in his"-initial
.financial. disclosure statement filed.
'Jan. 9, 1981, when his prospective
nomination was under consideration
by the Senate Select Committee on
Intelligence. The firm was formed in
;early 1979.
In August, however, Casey
amended his disclosure statement to
include .10 additional holdings, in'
eluding his interest in Energy Tran-
sition. In the amended statement, he
described -the value of his stock at
somewhere "-.between - $5,000' and
Unlike many other Cabinet-level
officials,: Casey did not-put his assets
into a blind trust. ..
Fri declined to disclose how the
companies?in.the consortium would
.benefit if the project is successful..
- ?Ther consortium; - Tailed.- 'Peat
Methanol Associates, wants to build
a plant near -Creswell;
N.C., that
_
would be ;capable . of. converting
676,500 tons-'of'peat a year into 67.5
million' gallons of methanol. The,
principle source of financial backing
sfor-the.project_is the: Koppers Co.,.
acting,: through a subsidiary-called
North Carolina Synfuela.Corp
Fri; _ -said the. the, 'consortium: ..is`. not
:.seeking a' loan. guarantee ccovering,
the. cost of the entire `project, In-'
'-stead, it. wants a limited. loan guar-
antee that-would, protect-the :consor-:
rtium in-the event.interest rates rise
,higher"than anticipated in; the.:pro-
posaL
the Synthetic Fuels-Corp: to provide'
' price `_ supports' for the. methanol."
;This would protect the consortium if
prices, of natural gas or crude oil, the'
'
principle
c ompeting fuels, fell' below
methanol _prices, making the plant's
product uncompetitive , ,--Zi
`tion' to'"irisulate us from 'abnormal"
events"in'the area of interest rates,
oil-prices and gas prices, Fri said.
Fri,said-'the question of Casey's
involvement withrthe firm' comes.'up?
regularly-_ we've discussed this ;.at
'board meetings"=but_the group has=
been :unable to resolve the question
:
"Should .we.. ask hini` to' turn `in his
shares?? n
Casey does not, F'ri, pointed out,
-attend board meetings or participate
in the operation 61 the firm in any
way. Beforehis appointment as CIA i
di
c
re
tor,.Casey served as the. secre-
Fri said the group shared a coni-
.mon entrepreneurial spirit, and, "We
-.set out to.see -if an entrepreneur
could succeed :in_ the synfuels: busi-
In a brochure, the firm said it spe-
cializes in determining new. markets,
and technology; obtaining financing
for projects, and, in the area of go
ernment policy,. the anticipation of
"the course of future government
:'policy,' the, securing of -".necessary
cooperation and approvals," and the
encouragement of government "to
'create the climate in which the pri-
.vate sector can. operate successfully'
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STAT
 Approved For Release 2005/11/28 : CIA-RDP91-00901R0004
Tj ~ ~.?
Dy X%UUCi'. r"_-.,
Globe Staff -,tR
~tMO ;
WASHINGTOPi -= CIA director
William--X Case y,15 a gone-fifth
shareholder a. synthetic :fuels
company.-with an applicatfon; be~ ?
company.-with US
fore the! government-spo.
-
F I m Corp it was
Synthetic ,
learned yesterday. : N~.;.r `' .
'.The company: -Energy Trarisi
tion': Corp. .`.: seeks loan. and prime
guarantees from the-agency fora
eswe i.
$350-million project in'Cr
N.C..Called First Colony. the.project
would : be the first to gasify peat too
produce a fuel called methanol.;_;2
Others associated with Casey in
the venture are former'membersof .~
the Nixon "Administration.,-d.7
which Casey served
se acknowledged his interest 1n
the venture.. The one-line, state. ; .
rnent said:,,. Casey. is-a small;
inactive stockholder, and? knows:
nothing about the activities of the.'
THE BOSTON GLOBE
31 March 1982
I s ^ f l e e first', CIA:director in at e t
~thx~a;Administratios~who'naintaiiis direction;
Mal affairs: He has not piit his'
f
itian:
of x-ts~owir
fi>ane1al trai sactions: into a blindt trust. as=did;'
George.Busi'lnderPresidentRichard M vixon
la'Turner in the Carter Administra;
f
ie,
and;stans
'tioirl aceordirig to Spencer Davis of the.Senate
+:. ~ RUbeTL~W?z~ T"f ~ a . W' ayitttt~w.....,.. :.-
. stn,- of the-'Energy
esearetxparidDevelop}?iefitAdminis, a one,
=T}e art`
of the Energy . V.
~wHl tate~c'Ciecame part ,
invent is thel"iead of Energy.Transition Coip Fri'
'that Casey, s r'involvement.in the
tsaicl_tester ay,
opfgtion is about zera } ,s, ?~ 3 , x
.'fOi'ine~~ir2
Fi=t said. that the corporation was
years-ago,
one. the original' guys "in .theiv.erit4re- said ,
FrcP' said that when Casey was appoi'ted di
4 Ga.}yi ?v y r.,a
a66 ds only interest'now is that o . a s ar z}
treys in the firm are Casey. Fri:
r
e pa
Cliatles W. Robinson, former deputy Secretary-
inistrator of
d
m
'of-State; Frank G. Zarb, former a
Administration. and 1Vii-
l Energy
ttit~edera former US representative to the.
liain:T..urner, !- --- For Economic Coomration and De-
duri
?.o
vetppment. The men served ogeth a
EoY`d and Nixon administrations:. -1
Casey served
d
'
,x.
t Gerald
,?thlder PresidenFor
Bank and at
t
i
.
mpor
bkh'as head- of the Export-
tment as and rsecretary for eco-
D
epar
tate
th" He was was Nixon= chairman of
ffairs
I1 ii a
. `ti*Securtties and Exchange Commission
ddit
spC3i ors in . a
Corp. Koppers Co: and J.B Sunderland
This consortium, called Peat Methanol Assn
~'ciates, wants to build, a -plant: near Creswell;
N.C., that would be ca'pable'.of converting
676,500 tons of peat a year into 67.5 million gal-
Ions of methanol. The principal source of finan
cial backing for the .project is the Koppers Co
`acting through a subsidiary called North Carole
el
S
r
y,,....
--t ca
Financing for the venture would all be pre
if it wins approval from.the-Synthetic Fuel
t
v
e:
a
`,Corp. Where. the government=sponsored agen-)
`cy's role would come into . play; according to Fri.
Is in a complicated set" of guarantees Involving
the price of the methanol fuel arid in the interest,
loari
aid on the $350-miilion.
t
,
es p
ra
r The agency would subsidize the price of what;
. Fri referred to as "uneconomic". methanol fuel,
x
ceeds what U.
or fuel whose:cost of production e
et:in,theworld market.', Fri said it would
could
g
also subsidize the-. corporation' temporarily for
ital invest-
the ca
t
p
rates on
teres
. fluctuating in._
'ment of the project. Without such a subsidy, the
`said, the-project would beti`uneconomic'
Casey. according 'to-a source who has
'searched the Senate Intelligence Committee. r
:cords, did not file=.with,,t ie?committee adiscl
sure of his-involvement. with:; the First`, Colony
;project, or his role as .one of the.'sponsors;with
Energy Transition.Corp.,According to the same
source, he did filed an amended:statement last
summer when the entire confirmation pros
f Casey was reopened. -.Casey did not include his Interest in Energy
'Transition in his initial- financial disclosure
hive nomination was under consideration by the
Senate Intelligence Committee The.firin was
ea l
Ne s 4 ^r ? . -.:
wt aced a.,
? Last,?August: however, y Casey amended ..his'.
;disclosure statement ao include. 10 additional-
;holdings: including his.interest ire Energy Tran-,.
sition. In the amended statement, he described
'the value: of his stock at,somewhere- between
$5000 and $15 .000 ,
.1 The Synfuel. Corp. was established as. part of.
. yPresiderit-jimmy-Carters energy program to en-.'
;production of alternative.
. .,s,.,~.~.~.~~
Approved For Release 2005/.11/28: CIA-RDP9f'~ ter.6 --. ,. ,.
r.ON-
 Approved For Release 2005/11/28: CIA-RDP91-00901R0004q
31 March 1982
CIA Director William Casey and four former top government employees own a
company that is part of a consortium seeking loan and price guarantees from the
U.S. Synthetic Fuels Corp., it was reported Wednesday.
The Washington Post reported Casey is a part owner of Energy
Transition, the managing partner of a consortium that would like to set up a
plant near Creswell, N.C., for the conversion of peat to methanol.
CIA spokesman Dale Peterson told the Past, Casey is a "small, inactive
stockholder'' in the firm and ''knows nothing about the workings of the
company.''
The Post said there is no suggestion of impropriety In Energy
Transition's application.
The consortium is one of five finalists chosen last week by the corporation
aaa competition for varying types of loan and price supports for synthetic fuel
ro;ects.
The paper said the other owners include: Robert Fri, former deputy
a ,,' inistrator of the Energy Research and Development Administration; Charles
Robinson, former deputy secretary of state; Frank Zarb, former administrator a
the Federal Energy Administration; and William Turner, former U.S.
representative to the Organization for Economic Cooperation and Development.
The five served together during the Ford administration, with Casey the
Pad of the Export-Import Dank and undersecretary for economic affairs at the
State Department.
Casey, the Post said, did not reveal his holdings in his initial financial
disclosure statement of Jan. 9, 1981 when his CIA nomination was under Senate
cvils3ideration. In August, however, he amended his statement to include 10
additional holdings and listed the value of his Energy Transition stock
between $5,000 and $15,000.
Fri told the paper that Casey, who served as secretary of the board prior
to his appointment as CIA director, does not now attend board meetings or
participate in the operation of the firm in any way.
Fri said the consortium, called Peat Methanol Associates, is seeking limited
loan guarantees that would protect the consortium in the event interest rates
rise higher than anticipated in the proposal.
in addition, the Post said, the consortium wants the Synthetic Fuels Corp. to
provide price supports for methanol. This would, Fri told the Post, "insulate
.us, from abnormal events'' in the areas of oil prices, gas prices and interest
rates.
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 STAT
Approved For Relea, R Aq/8 J 8j t frl~A[1J,?91-00901 R00
31 March 1982
CIA Director William Casey is financially involved in a C ur, rya was
tapped to compete for synthetic fuel. subsidies from the government, but an
associate says he does not have an active role in it.
Casey, whose business dealings were investigated last year by the Senate
Intelligence Committee, is One of five Stockholders in Energy Transition
Corp., but "is not active" in the firm, Robert W. Fri confirmed Tuesday night.
Fri is president of the corporation, which is the managing partner of the
consortium Peat Methanol Associates. The consortium is one of five finalists
selected Friday by the government's Synthetic Fuels Corp. to compete for
different types of loan and price supports.
The government corporation was created by Congress in 1980 to distribute
billions of dollars In various types of financial Incentives _ but not direct
aid _ to spur construction of synthetic fuels plants.
Peat Methanol Associates proposes to build a $350 million plant at Creswell,
N.C., to convert peat to methanol.
Casey played no role in the synthetic fuel project, said Fri.
"Mr. Casey is a small, Inactive stockholder," said CIA spokesman Dale
Peterson. "He knows nothing about the workings of the company."
All five principals in Energy Transition served together in the Ford
administration, The Washington Post reported in today's editions.
Fri was deputy administrator of the Energy Research and Development
Administration. Casey served as head of the Export-Import Bank and as
undersecretary of state for economic affairs and before that was chairman of the
Securities and Exchange Commission.
The others were identified as Charles W. Robinson, former deputy secretary of
state; Frank S. Zarb, former head Of the Federal Energy Administration; and
William Turner, former U.S. representative to the Paris-based Organization for
Economic Cooperation and Development.
The Senate Intelligence Committee concluded a four-month investigation of
Casey's business dealings last December. It issued a six-page report which
gave him what was considered a backhanded endorsement, saying that "no basis has
been found for concluding that Mr. Casey is unfit" to stay in his CIA post.
The committee's report said Casey had omitted large amounts of Information
an his Initial disclosure forms both to-the committee and to the Office of
Government Ethics.
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In his initial disclosure to the committee in January i9zi, Casey omitted
at least nine investments, valued at more than $250,000, the report said.
Casey did list his holdings in Energy Transition in an amended
financial disclosure statement he filed last August. He put the value of the
stock at between $5,000 and $15,000, according to the Post.
Regarding Energy Transition Corp., Fri said the five principals own
roughly equal shares, but said that most profits, if any, are to be distributed
to the two principal managers of Energy Transition - Fri, the president, and
Robinson, the chairman.
Peat Methanol's principal backer is droppers Corp.
Fri told the Post that the project sponsors seek limited loan guarantees to
protect them from increases in interest rates and price supports for the
methanol output.
The Synthetic Fuels Corp. said in its Friday announcement it was not certain I
that any of the five companies would win a subsidy.
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 ON PACE Ap /e 1 For Release 20bP% e1 - DP91-00901R0004
Foroliffillilln Lu-buVISIS11111111111111111111111HU191h W
T
Oy Operate in Washington
With expert American advisers
and millions to spend,
nations from Australia to
Zaire know how to get what
they want from Uncle Sam.
Casting aside traditional diplomacy,
one nation after another is plunging
into American politics with multi-
million-dollar lobbying campaigns
aimed at swaying official U.S. policies.
Reaping the benefits of such spend-
ing-estimated at more than 100 mil-
lion dollars annually-are scores of for-
mer high U.S. officials, including
senators, House members and cabinet
secretaries, whose political savvy and
access to power are increasingly being
sought by foreign governments and
businesses.
Even relatively poor countries are
spending heavily, often hosting lavish
parties, grinding out press releases and
underwriting junkets in an effort to im-
press American policymakers.
For many "hired guns" of foreign
governments, the aim is simply to cre-
ate good will for the country they rep-
resent. Increasingly, however, the
goals are more specific: To win for
their clients more U.S. aid, trade con-
cessions, technical assistance or mili-
tary hardware--or to block another
country from obtaining such favors.
Among recent examples--
0 President Reagan's proposed sale
of AWACS radar planes to Saudi Ara-
bia, which Israel opposed, was
snatched from apparent defeat in
the Senate by an intense lobbying
effort orchestrated by a Saudi
prince and his U.S. advisers.
^ The impoverished nation of
Zaire paid the Washington-based
law firm of Surrey & Morse
$208,524 over two years to plead its
case for more foreign aid.
^ DGA International, a specialist
in representing foreign interests,
was paid $927,855 by Morocco to
portray that country as a "stable in
fluence" in Africa and to reverse a
ban on the sale of arms to Morocco.
r Former Defense Secretary
Clark Clifford and law partner Paul
Warnke, formerly of the U.S. strate-
gic-arms negotiating team, received
$200,000 to help the Australian
meat industry gain access to the
n access tote
American market. They later helped
resolve a dispute over the discovery of
horse and kangaroo meat in a shipment
of Australian beef to the U.S.
Justice Department records show
701 persons now registered as required
under the Foreign Agents Registration
Act, compared with 452 in 1970. How-
ever, no one is certain how many such.
agents are actually at work.
After studying the situation last year,
the General Accounting Office found
that registrations represent "only the
tip of the iceberg" as a gauge of for-
eign-lobbying activity. Most agents, en-
couraged by lax enforcement of the
law, do not comply, officials believe.
Need for close watch. The GAO re-
port urged Congress to provide closer
monitoring of all foreign agents, espe-
cially in light of the so-called Abscam
cases, in which seven members of Con-
gress were convicted of accepting illegal
payments from persons they believed
were Arab businessmen, but who, in
fact, were disguised Federal Bureau of
Investigation agents.
The expanding use of direct lobbying
by foreign governments and industries
is beginning to worry many lawmakers.
"So much money is available that it's
corrupting our governmental system,"
says Representative Benjamin Rosen-
thal (D-N.Y.). "Foreign powers are able
to hire very distinguished Americans
with fine records to do their bidding-
frequently when those interests are con-
trary to American interests."
DGA Vice President Lloyd Preslar
An army of Japanese lobbyists is besieg-
ing Washington to fight for open trade.
disagrees. "Our Moroccan activity was
more purely political than most of
what we've done," he says. "Our firm
thinks long and hard about what Amer-
ican interests are before we take on
any client."
Adds DGA Chairman Charles E.
Goodell, a former Republican senator
from New York: "Most nations can't
afford large embassy staffs. They are
limited in resources and understanding
of our legislative process. Our system is
very different. Americans who know
the nuances of the establishment- can
bridge the gulf."
Most Americans registered as foreign
agents are attached to a relatively
small number of large law or public-
relations firms in Washington and New
York. Such firms often have several for-
eign clients at a time. The Washington
law office of Arnold & Porter is on file
as foreign agent for 12 clients.
Foreign representation has become
big business, with fees often topping a
half-million dollars a year per client.
DGA, for example, has been paid
a total of 1.8 million dollars by the
Moroccan government since 1978.
Former Senator Goodell reported
253 meetings, lunches and phone
calls he made to State Department,
congressional and other officials to
promote arms sales to that country.
When noise problems threatened
to keep the Concorde supersonic jet.
out of the U.S., its French manufac-
turer, Aerospatiale, turned to DGA
for help in winning landing rights.
The firm spent thousands of hours
in preparing reports and testimony
and contacting U.S. officials. For its
successful effort, DGA received 1.9
million dollars over five years.
ner party got silver spoons as mementos. by lawyers Clifford and Warnke for
Approved For Release 2005/11/28: -VONYEWMI
 pD
the Australian Meat & L istocrov-ke For
or-
poration were the filing of comments
with the House Agriculture Commit-
tee on meat-import problems and tele-
phoning members of the House inter-
national-trade subcommittee.
Later, when horse and kangaroo
meat turned up in some Australian
beef, Clifford and Warnke served as a
bridge between Australian and U.S. of-
ficials. "We were helpful in finding a
solution to the problem, and, as a re-
sult, a tighter set of rules and regula-
tions are in effect," says Clifford.
An issue before the Senate last year
underscored just how sophisticated in
their understanding of American poli-
tics some nations have become. In
weighing whether to approve Reagan's
proposed AWACS sale, senators came
under intense pressure not only from
the White House but also from skillful
Saudi and Israeli advocates.
Presenting both sides. "The Israelis
put on a high-powered and quite legiti-
mate full-court press," recalls Freder-
ick Dutton, chief American strategist
for the Saudis and a former aide to
President Kennedy. "Our stance was
designed to demonstrate a contrast-
that this was an issue for the U.S. to
decide based on its own interests."
Using previously effective tech-
niques, the American Israel Public Af-
fairs Committee, registered agent for
the Jewish state, began cranking out
mail, enlisting support from other Jew-
ish groups and circulating petitions
months before the vote. By July, a ma-
jority of senators had signed a letter
indicating their support of the Jewish
position.
The Saudi lobby held back until the
vote was closer, then went to work.
Operating out of a Washington hotel,
Prince Bandar bin Sultan of the Saudi
U.S. agents helped Australia when kanga-
roo meat turned up In a beef shipment.
Three laws regulate the> activi-
ties of agents for foreign interests
who are seeking to influence U.S.
policy-
The Foreign Agents Registra-
tion Act requires lobbyists for for-
eign nations to register with`:. the
Justice Department and, fits semi-
annual. statements listing `clients,
activities or services, rendered,
money received and expense's in-:
curred..Wherr approaching agov
ernment official or member. of
Congress'in behalf of "=client;' a -.
lobbyist Is: required to identify Wm__"
forei n government...'
tions-Act.prohibits public.ofiidials
or their relatives by ` blood, mar-"
riage,or adoption" from accepting
giftsworth more than 5-140 unless it
appears that refusing the giftwvould
offend the donor' or otherwise ad ,-
yerselyr,affect.the foreign relations
00RPARWO 19POQ1n for
Smathers (D-Fla.) and former Repre-
sentatives James W: Symington (D-lvlo.)
and A. Sidney Herlong (D-Fla.) to help
counter American condemnation of
that country's racial policies. Last fall,
the firm contacted House leaders in an
effort to defuse opposition to the U.S.
visit of South Africa's Rugby team.
One technique foreign interests use
to create good will is the offer of free
junkets to lawmakers, journalists and
others. In January, for instance, Sena-
tors John Danforth (R-Mo.) -and John
Chafee (R-R.I.) visited Japan as guests
of the Japan Institute for Social and
Economic Affairs, a registered agent.'
Japan is, by far, the biggest spender
on lobbying. One out of every 5 regis-
tered foreign agents in the U.S. works
for the Japanese, a sign of the huge
economic ties between the two coun-
tries. Over all, the Japanese spent more
than 11 million dollars last year to stay
abreast of and influence U.S. policies. .
William D. Eberle, a former Ameri-
can trade representative, has been ad-
vising Nissan Motor Corporation, the
No. 2 Japanese auto maker, which pro-
duces Datsuns, on U.S. trade matters
since 1979. In the latest six-month re-
porting period, he received $131,000
in fees from the company-
The Allen affair. Richard V. Allen,
former national-security adviser to
Reagan, also once provided consulting
services for Nissan. Upon joining the
administration, Allen sold his firm, Po-
tomac International, to Peter Hanna-
ford, a longtime Reagan campaign ad-
viser. It was after questions had been
raised about his continued contacts
with Japanese business interests that
Allen resigned from the White House
staff in January.
Justice officials say they constantly
battle to get more foreign agents regis-
tered, but claim that, with an enforce-
ment staff of only 20, they have a hope-
less task. Since 1975,- the -department
has filed 15 civil suits to force bashful
lobbyists into putting their foreign as-
sociations on record. In one well-publi-
cized case, Billy Carter, younger broth-
er of the former President, registered
only after authorities threatened to
cite hirrf for accepting some $220,000
in cash and gifts from the Libyan gov-
ernment. Carter claimed the money
was a loan, not a payment for services.
Violations generally are hard to spot.
For example, a lawyer hired to repre-
sent a foreign client before a federal
agency is not required to register or
report his activities as long as he makes
no attempt to influence beyond the
scope of agency proceedings. Yet, fre-
quently his work involves lobbying.
Director William Casey of the Cen-
The^ :Federal Election - Cam
,
y
paign., Act' o ;1976 prohibits any
foreign natioral from contributing -
--hibits~"any, American frorrr~accept
Iting such oonaii?rIs
royal family met with a parade of sena-
tors whose support was considered
winnable. Many were feted at recep-
tions and dinners at the Saudi Embas-
sy. At one black-tie affair, 12 senators,
plus other guests, sipped wine, dined
on Mideast cuisine and were given
small silver spoons as mementos.
Other Saudi officials sought in press
interviews to allay U.S. fears about the
proposed sale. Some hinted of harsh
Saudi reaction if the deal failed. When
the Saudis suspended all contract talks
with U.S. firms pending the AWACS
vote, senators were deluged with calls
from worried American businesses.
Was it Saudi lobbying or Reagan's
appeal that turned the tide? No one
knows for sure why so many lawmak-
ers switched sides, but, on-October 28,
the sale was narrowly approved by the
Senate, 52 to 48.
Few foreign-lobbying issues are as
dramatic as AWACS. More typical are
the low-key efforts of foreign clients
simply to have their views laid before
the American public. The government
of South Africa, for instance, pays a
$300,000 annual retainer to the law
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 A roved For Re ease 1/28 :CIA-RDP91-00901_R000400120001-3
tral Intelligence Agen as come un-
der official scrutiny for his previous o' Among reign Representatives
work in behalf of the Indonesiar~gsw-A Whs Who Fa
ernment, during which__he_aIle edly
-
To
bbied fora tax-law .chang_ewithout
registering as a foreign_ag-ent. Casey
b
Among those operating under the Foreign Agents Registration Act since 1980 _
as-
am
sador to Denmark and the Philippines
for which he then worked "made a
good-faith determination in 1976 that
no registration was called for."
Among Washington's "fast-growing
public-relations firms is Cray and Com-
pany, owned by Robert K. Gray, co-
chairman of the Reagan Inaugural
C..mmmithaa (:r,v rarantly hrnnaht ;n
Joseph H. Blatchford, former director
of Peace Corps
Clark Clifford, former Secretary of
Defense
Chile; Canadian oil interests;
El Salvador; Mexican rail-car makers
Australian Meat & Livestock Corpora-.
William Colby
former director of
,
Central Intelligence A
enc
g
y
Hymel, former aide to House Speaker Marlow Cook, former senator (R-Ky.) British tobacco and other interests;
Thomas P. O'Neill (D-Mass.). He also Australian sugar and cattle interests
got a new client in February: The gov- William Fulbright, former chairman'of United Arab Emirates; Saudi Arabia
ernment of Guatemala, which hired _._ _ ? ... . ..
the firm for the purpose of improving (D Ark ' vrafyn noiauui iJ
Guatemala's image" in the United (D-Ark.) -
States. Charles Goodell, former senator Morocco; French aircraft and
form. Hymel's registration statement
notes that he accompanied Abdul Raz-
zak Mohammed Mulla Hussain, deputy
chairman of Kuwait Petroleum Com-
pany, at a meeting last October with
Representative Rosenthal's Govern-
ment Operations Subcommittee.. The
Gray firm was paid $10,000 to prepare
Hussain for the hearing and to deal
with the press.
A. Sydney Herlong, former
representative (D-Fla.)
Linwood Holton, former Republican "
governor of Virginia
United Arab Emirates; Saudi Arabia;
Japan;.Bahamas Ministry of Tourism
Robert Leggett, former representative . Somalia
Jack McDonald, former representative Japanese motorcycles; Turkey
Hymel, Anderson and Gray, accord- Wilbur Mills, former representative British tobacco, food and
"
ing to the report,
critiqued a video- (D-Ark.) cosmetics interests
"
tape
of Hussain presenting his state-
ment and anticipated potential
questions from members of the House
panel. Hussain had been called to tes-
tify on the acquisition by Kuwait of
Saute Fe International Corporation, a
prestigious American oil-drilling and
engineering concern.
A jaundiced view. Says Rosenthal,
whose committee was critical of the
purchase: "The Kuwaiti government
now owns some of the most highly re-
spected engineering skills in the world,
and the purchase was orchestrated by a
lot of high-powered Washington lobby-
ists. Former President Gerald Ford is
on the board of directors of Sante Fe
International-that helped the deal go
through speedily."
All this is entirely legal, but Fred
Wertheimer, president of Common
Cause, the self-styled citizens' lobby,
believes that, by pouring so much mon-
ey and resources into lobbying, foreign
interests are distorting the American
political process.
Argues Wertheimer: "Too much
pressure is being brought to bear in
influencing public-policy decisions." El
James O'Hara, former representative
(D-Mich.)
Korean Marine Industry Development
Endicott Peabody, former Democratic Haiti; Japanese fisheries
governor of. Massachusetts .
William P. Rogers, former
Secretary of State
Sargent Shriver, Jr., former director of
Peace Corps and Office of Economic
Opportunity, and ambassador to France
French nuclear-power and other
James Symington, formerrepresenta- South Africa
Paul Warnke, former director of Arms
Control and Disarmament Agency and
Corporation; Algeria; French aviation
interests; European shippers
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 Approved For Release 2005/11/28 : CIA-RDP91-00901R00040
RADIO TV REPORTS, I NC
4701 WILLARD AVENUE, CHEVY CHASE, MARYLAND 20015 656-4068
PUBLIC AFFAIRS STAFF
PROGRAM Face the Nation STATION WDVM-TV
CBS Network
DATE March 28, 1982 11:30 A.M.
SUBJECT Senator Barry Goldwater
Washington, D.C.
GEORGE HERMAN: Senator Goldwater,. the people of El
Salvador are voting today, with the possibility of a victory-by
the extreme right. What do you feel should be the United States
policy towards whoever wins the election in El Salvador?
SENATOR BARRY GOLDWATER: I think we ought to try to
get along with them. I think we should do whatever we can in a
noncombatant way to help the country. Central America is as im-
portant to us, I think, as any part of the world, probably. And
I wouldn't want to see us go down there with armed forces if
there's a chance of getting the whole thing to work. And I think
maybe we can do it.
ANNOUNCER:' From CBS News, Washington, a spontaneous
and unrehearsed news interview bn Face the Nation with Senator
Barry Goldwater of Arizona, Chairman of the. Senate Intelligence
Committee. T
Senator Goldwater will be questioned by CBS News con-
gress.lonal correspondent Phil Jones; by Jack Germond, syndicated
columnist for the Baltimore Evening Sun; and by the moderator,
CBS News correspondent George Herman.
HERMAN: Senator Goldwater, It was your opinion in your
first answer that we should get along with whoever wins the elec-
tion in El Salvador. But supposing it should turn out to be the
extreme right wing,..Ma,jor D'Aubuisson, who says his first action
would be to hang President Duarte, a man who's been -- D'Aubuisson
has been called a psychopathic butcher. Should we get along with
him, or should we put him in some kind-of quarantine?
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OFFICES IN: WASHINGTON D.C. ? NEW YORK ? LOS ANGELES ? CHICAGO ? DETROIT ? AND OTHER PRINCIPAL CITIES
 Approved For Release 2005/11/28 : CIA-RDP91-00901R000400120
ARTICLE APPEARED
ON FAGE,_,_
THE WASHINGTON POST
PARADE MAGAZINE
28 March 1982
W931 X- r &2%
Q. Can you explain why William J Casey, direc-
for of the Central Intelligence Agency, did not I
place his vast holdings, worth approximately $10
million, in a blind trust when he was appointed to
the job? Surely there is a possibility, of Casey's 1
obtaining secret information as CIA chief, which
he could use to his financial advantage.--C.L.,
Chevy Chase, Md.
.A. The law does not require the Director-of Cen-
tral Intelligence to:place financial holdings in a
blind trust, and Wiliam Casey chose not to do so.
.Some previous CIA chiefs, however--to avoid crit-
icism and possible conflict of interest -voluntarily
walked the blind trust road in the past.
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 ARTICLE APP Z. RED
ON PAGE Approved For Release 200 V ,,_0IfpP91-00901 R
flughes points out a military installation: Longer and louder alarms about communist meddling in America's backyard
rW he lights dimmed, the projector
beamed and the screen filled with
blown-tip aerial photographs that conjured
up an earlier time of confrontation. Before a
packed house of reporters, John Hughes,
the photo-intelligence expert who present-
ed the evidence in the Cuban missile crisis
twenty years ago, took a pointer last week
and made the Reagan Administration's
case against Nicaragua. Flipping through
the grainy photographs, Hughes said the
Sandinistas have built 36 new military in-
stallations in just two years. He pointed to
new airfields, lengthened runways and a
dramatic array of Soviet-made tanks, truck-
drawn howitzers, helicopters and amphibi-
ous ferries. He showed Nicaraguan troops
in training and put the total number of men
under arms at 70,000=-the biggest and most
threatening army in Central America.
"Who is helping the Sandinistas do this?"
he asked. "The fingerprint we find, in every
case ... [belongs to] the Cubans."
The carefully orchestrated show-and-tell
session was the most, successful element in a
ragged propaganda blitz last week. The of-
fensive seemed to reflect the Administra-
tion's growing frustration over the limits'of
its ability to act in Central America. Neither
Congress nor the public seems inclined to
STAT
from candid about the size of their military
buildup, nothing in the declassified material
showed a direct conduit of arms into El
Salvador. "I think most people were ready
to believe that the Nicaraguans are building
up their army," said o+ie U.S. official, "but
that was never the problem."
The Administration hoped to make the
Nicaragua-Salvador ecnnection with a pa-
rade of witnesses from the front-but the
first step went disastrously awry. The State
Department invited sic reporters to inter-
view Orlando Jose Tardencillas Espinosa,
19, a Nicaraguan captured in El Salvador.
Tardenci.llas had "conf -sled" earlier that he
had been sent to the war zone by the Sandin-
istas. But when the tape recorders started
rolling, he stunned the reporters--and U.S.
officials--by suddenly taking back every-
thing he had said. He described himself as a
free-lance revolutionary and said he had
been tortured and beaten into collaborating
with El Salvadorand W.shington. "The day
before I came, an officer from the U.S. Em-
bassy told me what I should say," he said.
"He told me they needed to demonstrate the
presence of Cubans in El Salvador. I was
given a choice. I could come here and do
what I'm doing-or face. certain death."
Tardencillas's bizarre: turnabout left the
accept Reagan'swarnin4al &rr iskelf S@ -i46Ma'sGI RD 4)901 RM4i@01W0th1a3bind_ For weeks offi-
rneddlingintheregion. Thepublic mood has answered. While the photo evidence dem- cials had been hinting that they had top-
all but ruled out direct military intervention. onstrated that the Sandinistas had been far secret intelligence data on the Sandinistas'
'fln77?: rani'
As a result, the Administration has found
itselfwith few alternatives other than sound-
ing ever longer and louder alarms.
It was hard to say what the alarm bells
foretold. Washington seemed to be playing a
high-stakes game of psychological warfare
designed to keep the Nicaraguans, Cubans
and Soviets guessing about Reagan's ulti-
mate in tentions. One possibility was that the
Administration was hoping to use its evi-
The Administration
launches a frenetic
propaganda campaign
that leaves troubling
questions unanswered.
dence to enlist other Latin American na-
tions to help cut the flow of arms to Salva-
doran leftists. Looming behind it all was the
prospect of a darker playa: a CIA proposal to
help paramilitary groups cut the flow of
arms from Nicaragua to El Salvador.
Therewas no doubt about the earnestness
of the Administration's concern, but its me-
 STAT STAT
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ARTICLE ?,. FP, `,4YED
ON "PAGE_
TIME
22 MIlARC:i 1982
The U.S. bungles its evidence offoreign subversion in El
There were briefings and
consultations, complete
with spy-plane pictures
and closed door revela-
tions of secret intercepts.
It may have been the mostr
intense national. security
information campaign since President
Kennedy went public with graphic docu-
mentation of the Cuban missile threat 20
years ago. The purpose of the blitz was to
convince skeptics of the correctness of the
Administration's approach to the critical
problems of El Salvador and its neigh-
bors--namely, that the struggles in Cen-
tral America are not simply indigenous re-
volts but rather are crucial battlegrounds
in a broad East-West confrontation.
Facing a credibility gap at home
and abroad, the Reagan Administration
sought to prove that the fire raging in El
Salvador is primarily fueled by Soviet-
sponsored subversion spread by Cuban
surrogates and the Sandinista govern-
ment of Nicaragua. In that extreme and
simple form, their case is as yet unproved,
and indeed-by the very nature of these
conflicts---may never be. In a lesser
form-that there is significant involve-
ment by Cuba and Nicaragua-the case is
almost self-evident.
The campaign, to say the least, had its
problems. In fact, the inability of the Ad-
ministration to line up convincing wit-
nesses would have seemed farcical were
the matter not so serious. First there
was the so-called "smoking Sandinista,"
grandly touted as a captured Nicaraguan
commando who had helped lead the insur-
rection is El Salvador. But when police let
him loose to show the way to one of his pur-
ported contacts, he disappeared into San
Salvador's Mexican embassy, which said
he was only a student and granted him
asylum.. Then there were two Nicaraguan
air force defectors who were scheduled to
bear witness to their country's involve-
ment in El Salvador but by week's end
were judged "not ready" to face the press.
Finally, there was a young Nicaraguan
soldier who was produced by the State De-.-
partment but then promptly repudiated
his previous statements about being
trained in Cuba and Ethiopia and having
been sent into El Salvador by his govern-
ment. The U.S. did have solid, evidence of a
major military buildup in Nicaragua, and
former high national security officials
were persuaded by str 1
Salvador rebels. Nonetheless, the blunders
and bad luck over the live witnesses to that
subversion greatly undermined the Ad-
ministration's plausibility.
Presiding over this curious series of
public presentations was the prime propo-
nent of the Administration's us-vs.-them
world view, Secretary of State Alexander
Haig. "This situation is global in charac-
ter," he told a Senate Appropriations Sub-
committee last week. "The problem is
worldwide Soviet interventionism that
poses an unprecedented challenge to the
free world. Anyone attempting to debate
the prospects for a successful outcome in
El Salva
et mena
the tnin
Hai
vador is
ministr:
Defense
that it I
stake sc
tain ba
advisers who were reluc_ant to detract na-
tional attention from tt President's eco-
nomic program. Convir ced that this bat-
tle would be cleanly and quickly won, the
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_
ON FACE,
NEW YORK TIES
22 MARCH 1982
Former Chief of C.I.A. Honored by O.S.S. Veterans.,
The William L. Donovan Award, ;. is John A. McCone, the California in.,
named for the late major general who dustrialist whose various government.
fcttrxied the Office of Strategic Sery- positions included a stint as Director
icz..during World War II, is given by of Central Intelligence. The Central .I
O.S.S. veterans each year. to those rho Intelligence Agency, which heheaded; _
have
d
d
i
ren
ere
s
ngular and distin- was an outgrowth of the wartime
guished service W the United States,, O.S.S. though riot necessarily in the intelli. The award will be presented May
gepce field. at a dinner in San Francisco, where.:
Previas 3vinner3 for example, the 80-year-old Mr. McCon, e makes his
have included Lhe late Senator Everett home. To help assure its success, the-:
have en of Illinois. the Ar:nnn 17 -,-zr,,. veterans organization has persuaded
d
G
n
ent
eraldR. Ford and Wrl1iarr i
hatchero4Britain, awi
J. Casey; the current Director of Cen-
gave a hacxground in intelligence. He of the dinner.
STAT
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 ARTICLE
05 PAGE
or Release 200 `1 8 ` I FP91-00901R000~
A Top Spook's Political Appearance
The scheduled appearance of Central Intelligence Agency direc-
tor William Casey at a $200-a-plate GOP fund-raising dinner next
week has caused a stir in Washington circles. "It's outrageous,"
says one highly placed Administration official, since CIA directors
have traditionally taken extra care to avoid partisan politicking,
One Reagan hand who certainly knows that is Vice President
George Bush. Before confirming his nomination to the top CIA job,
Congress got assurances from President Gerald Ford that he would
not pick Bush as his running mate in 1976.
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 Approved For Release 2005/11/28 : CIA-RDP91-00901 R000400120000-3
l'RTICf1l Zj?:e,E:IALD 2`II
,
22 MARCH 1982
,
-
The Presidency/Hugh Sidey
Needed,- Strength and Pat"i ce
rom Ronald Reagan's first day on the job, photographs and clandestine re-
ports have flowed across his desk every morning, convincing this President
that a revolution in the Caribbean has been coaxed and fed by Moscow and Ha-
vana. The CIA gave the world a glimpse of that evidence last week. But docu-
mentation of a big military buildup in Nicaragua is only one fragment of the in-
doctrination the President has received in superpower chess.
He has listened to CIA Director William Casey narrate how the Soviet Union
has exploited food, technology and credits from the free world; both men were
astonished at how important these were to Soviet society. Lips pursed, head
shaking in grim amazement, Reagan watched the agency's "horror show"
of satellite pictures of Soviet ships and submarines coming down the ways,
bow to stern, like compacts rolling off a Detroit production line.
Reagan has sat, wondering at the irony of it all, as his briefers have traced
how captured American M-16s, their serial numbers clumsily altered, were
shipped around the world from Viet Islam to the rebels in El Salvador. The Presi-
dent has observed the painstaking accumulation of evidence that Moscow's cli-
ents have used poison gas (the deadly "yellow rain") in Southeast Asia and that
the Soviets have themselves employed it in Afghanistan-perhaps out of frustra-
tion that all their troops and equipment have been unablq to break down a stub-
born resistance by the mountain tribes to military occupation.
Reagan relished the accounts of how the CIA penetrated the Polish govern:,
ment and how informers, once discovered, were spirited out of the country along
with their families-but not before they had disclosed Moscow's hand in the
martial-law crackdown. Reagan has followed the cabled details of Leonid
Brezhnev's tears and grief after the recent death of Mikhail Suslov, the hard-line
ideologue of the Politburo. Some of those secret reports tell of instant "personal-
ity changes" of high Soviet diplomats when they were informed of Suslov's de--
mise. Those diplomats grew distant, their minds back in Moscow, as they wor-
riedly waited for the changes that inevitably follow any unexpected interruption
in totalitarian authority.
Reagan has been tutored day after day by his experts that the Soviets are in a
"historic decline" and a "systemic failure" that renders them, despite their pow-
er, more unpredictable and dangerous than ever. From all of this, and much
more, he has concluded that we have entered two of the most perilous years of
modern times and that in this period it is imperative for the U.S. to stay strong..
This conviction explains why the President seems shrill about Central America
and sometimes nearly fanatical in his refusal to cut defense spending. He be-
lieves that America's-and his--credibility, both with adversaries and friends,
lies in the extra billions. Those dollars instantly translate in Reagan's mind into
helicopters and guns, then into confidence and courage, and ultimately into vic-
tory for our side. ,, .
The danger-and it is a serious danger--is that the President may be a pris-
oner of his preconceptions, and that the selectively chosen evidence being shown
him could simply reinforce his entrenched ideology in illusory ways. El Salvador
and Viet Nam are not alike, in either geography or politics, but restraint and pa-
Appro' &W * * t cm KCP9-1u00~#0b#~8O8A20M-3
years ago. ze viet empire is overextended, Reagan's challenge
is to assist that "historic decline"-a long journey requiring quiet courage and
extraordinary sensitivity..
STAT
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7 A TICL3 x? Pte':.`?~
LOS ANGELES TIMES
21 NATCH 1982
ASH1NGTON. 'Tfie ?United Sttites - does not - The 19,17 law establishing tt
condcre the assassination of foreign leaders,' ' ly authorize covert operation.
President Reagan's press secretary, Larry set urf the C1A, it thought it v
Intelligence Agency had been given $19 million to build port onthem. - -
which were not denied by the White House, that the divided into two parts-intelligence, w i ch ar. syzes in-
President had approved a number of covert operations formation, and operations, which conducts ? spionage
designed-to "destabilize!" the Sandinista government of and other covert action. Unlike the analysts, the covert
.Nicaraguan, ne published report said that the Central -operators seek to manipulate events, not finer>ly to re-
Speakes,.declared several months ago, "and we do not collect and evaluate intelligence itier:?nation. But the '
condone the overt-row of foreign governments by the same law also authorized the CLA to perfcrrn "other
U.S. goverpmerL" functions" for the President, and the phrase has been
Last - wee'x - Washington was abrvz rrith reports, used as the legal basis for covert op-e:aciors. The CIA is
CO-IN'`I.-'y'\l .
',~licly. ?-j -the machinery for approving covert ozrat,ons. F3116: a
.War II-has engaged in a number of covert operations rnittee:: Carter's.executive order on intelliar~ once de--
C
ourd" the globe. Indeed, if Speaker' statement that the scribed-the duties of the SCC and listed i*smeinbers:.
United States does not overthrow other governments -` But when the Reagan executive order was published
was to be taken literally, it would be big news, marking ; last year, the SCC had disappeared. Ti e order contained
a rnatcirchange in American foreign policy.: :x's _` no mention of the committee or of any succew:ter panel
Although 8.here have' been some revisions ire tlieiaws A-White House official who declined to be ideoti5ed
and ground-rulesgoverning covert operations, the CIA= said.the SCC. had.beenreplaced by rot ore but. three
his still' free?trs:cxinduct suck cpsrations if the President National Security`Cauricil com,-nitt_ee3,_t'r_e";enior in
approves them: And b; all accounts, the pace-of'covert terdepartrnental o oiler kno vii- as SIGs`."; t me group--..,
;action is increasing tinder the-Reagan'AminisLration deals-.with foreignte.day,. he`: is inreturn fot a U.S pledge not to try to about-the s.+rne' amount time t`le"
"studying theimplications of a mur depose Premier-Fidel Castro. Russians would have i` th U .'s, Iau'
Soviet threat to place: the United States CIA DIRECTOR William Casey said (lied the Per. h ink 2 rte' 11? .hedui~ d
in new nuclear peril in retaliation for in an interview two weeks ago that the for deployment in Europe the end of",
.-the planned deployrnent of L!.S. mis Russians.have violated the agreement next ye,r:' Tlie`SovieLh r riot yet
cues in Europe. for 20;years But the Pentagon yester perfected ; a fiattrajectc miss>ie
Soviet PresiIle on d I3rezhnev day- described as "ridiculousrecent, to Breaking the currep de!-
dent' c .:
warned in a speech in i,loscow'Tuesday r e 'sorts that the Russians have actually agreement to observe the t ns of the
that if the U,S: procsaens to in;stall_572 "established nuclear bases on the SALT2 str,submnarines::carrying of a third country close or I: to the- q
It I
^
flat-trajectory%rlussiles':near.-the US forachortnoticesuip attack
.fiargo of,Sovlol missiies_tsr-anen
:area) if they were placed In Cuba ;'= ?
~.. . iJOBEAT JUFfRA5 DAILY NEWS
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 STAT
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BALTIMORE NEWS--AMERICAN
15 March 1982
"Jr 'here this ~oI'ternoon becau4t I'an concerned
briefing for reporters at the-:JState Departrnerit, Havana are providing the arms and ad lice to
but hi words aeraprompted by an unusual situ- b ve Nicaragua the largest military force in C'en-
atior -lntelIi enc iffcials had beei7 trying Eotell traI'A.*nerica 'And-Nicaragua;'.as,~,,~I, ' I;,recror
C onC ress and the publicfor days that there is a `uilliaan J~.Casey.says, is ,fanning the yflarres of
threatening buildup of military strength in Nica_, insurrection in El Salvador.
ragua,:and that it is-made-ptxisrbleby assistance AdmzraI Inman was concerned about the reed
f orzr Cuba and the Siwiet vnson to,inform Americans about what isgoing on on
Tlie-reports were?:treated with skepticism, in' . `our -doorste ' to`the south ".irid `what ~t "
Congress and elsewhere- and that:was the reason for this coon po? Ynd''
'for Admiral Irunan'a conce^%and- anger. -The"administration is serving the'best nter-.,.
At them urging of the- administration, Intel-Ii- ests"of the country': by, presenting its case with
gence 'officials declassified sensitive information these`briefin, . It:is an effort to open Air.-ric,
that included reconnaissance photographsand _eyes bD-the fact that the trouble in'Central .\mer-
stati"stics relating the'size of Nicaragua's armed ica is much-more than an internal ar ar as._.~
forcer Release secree;inforrnation.of this nature some-havgriislstecl w 6 r.
and because I'm angry.'
This may seerrr??Iike ani.unusual way, for CIA
I)eputy~?Director :Bobby- Ray Inman. to open a
is rare; ;but the administration felt The rr.oment
had, arrived to tell the truth to a skeptical aublic.
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 ST
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U.S. NEWS & WORLD REPORT
:-.z, 15 MARCH 1982
lashir~~taIn Ir@
CIA Director William Casey sur-
prised the WhiteIlouse with his pub-':
statement that shipment of Soviet'
MiG-23s to Cuba breaches the Ken-
nedy-Khrushchev 1962 agreement!
barring the Kremlin from sending of-'
fensive weapons to the island. Presi-'
dential aides had been trying to tip-
toe around that delicate issue.
The Central Intelligence Agency has
found a compelling new reason why
it should be exempt from disclosing
documents under the Freedom of In-
formation Act. CIA officials claim
that, too often, they release classified
material by mistake.
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 .15 tttsrch 1902
John Birch: Beware
The One-Won tiers
Ever since its founding in 1958, thejohn
Birch Society has campaigned against big
government, high taxes and-above all-
communism. It's riot going to slack off just
because a conservative is in the White
House. President Reagan may be moving in
the right direction, says society member
Gary Allen, but he's taken "a 5-foot leap
across a 9-foot ditch."
The society, named for a Baptist mission-
ary and American spy who was killed in
China in 1945, has widened its focus since
the early days. Still headed by 82-year-old
founder Robert Welch, it considers com-
munism only one arm of a "master conspir-
acy" in which socialist American "insiders"
are plotting to establish one-world govern-
ment. Even theAdministration has its share
of insiders, says public-relations director
John F. McManus-among them Secretary
of State Alexander Haig and CIA director
William Casey.
Youth Camps: To spread the word, the
John Birch Society syndicates daily corn-
mentaries to 75 radio stations, publishes a
newspaper column and deploys some of its
50,000 members to speak around the coun-
try. It has also set up a network of TRIM
(Tax Reform Immediately) committees to
inform Americans how their congressmen
voted on tax bills and claims some credit for
helping to defeat several liberal congress-
men in the 1980 elections.
The society operates a chain of eleven
summer camps for teen-agers. Along with
sports, the camps offer seminars on topics
such as "The United Nations-Get US
Out" and "What Is Communism?" Birch
officials say that at the end of each session,
when counselors ask the youngsters to join
the society, 75 percent usually do.
Once probably the best-known conserva-
tive organization in America, the society
now shares the stage with such New Right
groups as the Moral Majority. But Birchers
believe that they havea deeper coin initment
to traditional American values than any
newcomers, and that they remain a breed
apart. As one member says proudly: "Not
just anyone can be a Bircher." _
in Newt Yo k and CHARL S GLASS in Boston,
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ARTICLE, APPEARED
0 PAGE--/.~>
i'T W YORK TIMES
15 MARCH 1982
ellin ga olicy. to Public
U.S'.intelaigence Data on Central America
Has Not Translated. into Support for Plans
WASHINGTON, March 14 - For the By that, he said, he meant opposition
It two weeks, the Reagan Adrninistra- was primarily coming from organza-
tiara has cor:ducted what senior officials, lions and individuals whose main inter-
acknowledge has been an intense public est was to prevent further conflict.
relations campaign designed to dispel. Missing from this perspective, offi-
doubts about its policies in teals said, was an understanding of na-
Central America:' The ef- tional security considerations. "We
:tort, ;s hick has relied heav- failed to make our case convincingly
Aw:alynis ily on the use . of intelli-? even in Congress,' another senior Ad-
Until Friday, officials thought they
Some members of_Congress, including
men, carne away from private irtelli-
strong evidence to support its charges
Central America and of Nicaraguan aid
The public was given a glimpse of the
intelligence material when the Admin-
,tra'ticn made public aerial reconnais-
n-militariforceinCentral America
Then on Friday, the campaign re-
ceived a major blow when a young
Nicaraguan captured last year while
dorsurprased theState Department at a
crinrihct 3 a
That unexpected 'development has
prompted a reappraisal of the public
relations offensive among. senior Ad-
minis-tration officials who must decide
Monday whether to proceed with addi-
tional intelligence briefings for Con-
gress and the press tentatively sched-
uled for later in theweelt.
T pressure appears to be great to
90 through with the briefings.. Accord-
ing to several senior officials, the initial
.decision to conduct the public relations
campaign was considered long overdue.
"We made a mistake," one senior offi-
cial said last week. "We were pressing
ahead with a policy before we had con-
vinced either Congress or the. public
about the nature of the nation's vital in-
_terests in Central America.
State Department.officials recently
'concluded that mec?t of the dor~
the Administraticlrll~IZt"1~rf
policy was generated by what one offi-
;cial.called. "'hurmanitari:an",?concerns,.
Even critics of the Administration's
policy were persuaded that some exter-
nal involvement exists. "i don't think
that anyone disputes that there is some
foreign involvement in El Salvador"
said Senator Paul E. Tso;,,.gs, Derno-
crat of Massachussetts. question
is how much and how signif ;cant it is."
That question was apparently not re;-
solved by the Administration's cam-
paign. Critics, for example, pointed out,
that the photographs showing a major
military buildup in Nicar-tgua did not-
prove', that Nicaragua wa:; aiding the
Salvadoran guerrillas.
Senator Christopher J. I odd, Demo-
crat of Connecticut, a lea,.ling critic ofi
Administration policy, said that "to
suggest that Nicaragua is the only
source of support for Salv':C:o?ran guer
rillas is ridiculous.,,! He aid that the
guerrillas received ? subst
ti
l
an
a
ministration official said. "We decided amounts of arms and amp. unition' from
log
o back to square one, layout the evi- sources within El Salvador, including
dence we have and hope we could build disloyal army troops.
the ldnd of broad-based support that has Nicaragua's Amba sad ,r in Wash-
been lacking." .i.ngton, Francisco aillcs Navarro, re-
The campaign focused on Congress..'sponding to the intelligence made nub.
Senior intelligence officials, led by Wil- lic about his country, charroecl in an in-
liam J. Casey, the Director of Central terview broadcast by the Ctble News
Intelligence, started briefing Congres-! Network today that theirii.tarybuildup
sional committees about what the A.7
ministration considers to be Cuban,
Soviet and Nicaraguan interference in
El Salvador.
According to members' of Congress
who attended the briefings, the Admin-
a ;as forced because the ' Reagan Ad-
ministration is threatener. us all the
time with the possibility 14 a military
intervention."
-till other critics argued that the Ad-
ministratinn was ove
. h .d_]_
r
intelligence collected through -elec- i ne
problem in El Sal vador is ,rimarily an
tropic surveillance of radio traffic in El economic ere," said Senat:3r Clan erne
S alvador-and surrounding nations, in Pell, Democrat of Rhode Island, the
el uding Nicaragua. ranking minority member,) f n he Sena t e J
that have been positioned off the coast
of El Salvador and Nicaragua since late
last year, this information included de-
p
-
tails of communications between Salvo- sa, senior Administration ,?ticials still
doran rebels and command posts in believe in the power of their intelligence
Nicaragua, which they said showed that data. "Whenever we can s t down with
the Salvadoran insurgency was con-, someone and show them what we've
trolled in Nicaragua, Administration of got, we can persuade the-r-1 Cuba and
ficials told the committees, according Nicaragua are involved," one official
to several members. Similar briefings Pr said.
were given to a group of former senior. , What the Administration cannot do
Government officials. : , ?,; ..;..; , . ~n ,,. top officials acknowledge, is translate
intelligence information about outside
`CorivincingIntelligence' interference in Central Arnerica into
The Administration was encouraged 'support for theGoverunent'spolicy.
by the results. After a briefing
a given to-.
the House Intelligence Committee, the
panel's chairman, Representative Ed-
ward P.' Roland, a Massachussetts
Democrat . who is considered a bell-
wetter of moderate Congressional opin-
ion, said that the.use of Nicaraguan
sites for command and control of Salva-
doran insurgent forces was supported
by "convincing intelligence." He added
that "Cuban involvement, especially in
providing arms, is also evident."
Senator Richard G. Lugar, Republi-
can of Indiana, said, "'The case of sub-
ttSY~tfO
day's turnabout by the tficr?r?aguan call:
tive, OrlandoJosuTardencillas Es
ino
STAT
STAT
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014
vD10i!EY PROBLE1S
PLAGUING SOVIET,
FIGURES INDICATE
Debt and-Trade Deficit Are Up,
Foreign Reserves Down i
U.S. Debates Reaction
By HEDRICK SPiUTa
` WASHINGTON, March I3 _ Evi-
'dence is growing that the Soviet Union is
having a cash-flow problem -with the
currencies used in international trade-
This has sharpened debate within the
A_dministration's over how vigorously to
NEW YORK TIMES
]l+ M RCH 1982
"Two things have been mixed up," Rumania and other East European
said one senior Defense Department of- countries. i
ficial. "One is the Polish sanctions. The
other is a longer-term strategy to insure
that the West does not become the
source of aid and support for the Soviets
to go on spending 13 to 15 percent of
gross national. product on defense. I
think it's a benefit to the West to elevate
the guns-versus-butter argument in the
Soviet political hierarchy."
More concretely, Fred C. Ikle, Under
Secretary of Defense for Policy, urged
American banks on Friday not to extend
credit to Moscow for grain purchases.
'"Requiring them to pay hard cash will
work to limit their ability to. maintain
the.?military: expansion program they
,haveunderway,"he said. '
If that persists, as expected, most
policy makers believe, Moscow will
eventually have to permit soale;iberali-
zation in Poland and perhaps elsewhere.
The problem for the West in applying
economic pressures there, American'
bankers say, is that the West itself can
be hurt economically.
Forcing a Polish default on Western
loans "is a very bad strategy," says Leif
Olsen, chairman of the economic policy
committee at Citibank. "It would have
repercussions for the West as much as it
would for the Soviet. And I'm not at all
sure that it heightens the pressure on the'
Soviet."
These are some of the indications of
Moscow's cash-flow problems cited by
t'-Another Another camp, centered in the State Government and other experts:
..Department and Treasury Department, An increase in the Soviet Uriion's
contends that the Soviet economy is too short-term debt last year to d15 billion
large, too nearly self-sufficient and too from $13 billion.
accustomed to belt-tightening in times 9A drop in the level of Soviet hard-
of stress for the Kremlin to be pressed currency reserves in Western banks
e
from into con~ons on its vital interests or b$8 last t Sept. 3at0 the and, it end is of r-stim to' s ated,
billion
mainlines of policy. 58 billion atyear'send -
apply economic pressure to try, to force 1 This group contends that for all its ob- I 9Requests to West German and Japa-
Moscow. to ease- repression. in Poland ; vious cash-flow problems, Moscow has nese trading companies to r ermit de-
$3D !and to slow military spending and over well~over billion in gold reserves and layed repayment of about $1 billion in
Western debt of $20 billion. Some offi-
cials also recall.that Moscow resisted
similar Western pressures in the early
postwar period, and also recovered
from a considerably worse foreign ex-
changeproblem in the mid-1970's.
"Hard" generally refers to those cur-
rencies that are freely convertible
among themselves, such as the dollar or
the French franc; "soft"- currencies
cialistit report, the SovietUrdon's shojt-
-
era banks fell $2 billion.
Gold Sales and Pleas on Debt:
PressureNot Only on Poland they can pull in their horns a lot more if Soviet Union had to-underwrite some-
.
Theysee the situation in Poland not so they get into a really tight foreign debt ports close to $1 billion for Polish tin-
bth~? ports from the hard-currency area, not
much as the focus of policy as an oppbr to mention indirect subsidies of Po-
tunity to marshal support in Western.. Possible Repercussion In West ,land's trade with other Communist
Europe and Japan for an ambitious countries.
how-
campaign to press the Kremlin not only The two groups generally agree,
so especially C~?IV13`d
to make concessions in Poland but al ever, that Eastern Europe,
Poland, is the economic.Achilles heel for
last year, double the 1980deficit:'.'. "The Soviet financial position has de-1 11tl "met economy is in ternhle
Under. these pressures, the Kremlin ! teriorated sharply -- but from a very shape," Marshal Goldman, professor of
has felt compelled to sell what is esti-' strong base," one State Department of- economics at Wellesley College, corn-
mented. "The Soviet casks-flow problem
mated to be 300'tons of gold, worth about ficial asserted. "Don't confuse the idea
$3.5 billion, over the- last six months.. of their 'scrambling around -because is an external manifestation of internal
Soviet trading companies have. also everything has fallen apart'with problems. Their grain problem is not
just a theoretical exercise: It costs hard
asked Western. and Japanese companies - scrambling around to get all they cancy ?
now because they are anticipating an major reason for the trade defi-
to postpone collection of about $1 billion f The ma
American policyof a credit crunch-"' cits was a bi food im-
in short-term debt. "There's a big difference between the; g increase in Soviet
Moso7w's problems hav -encouraged difficulties the Soviets have and bring- - ports caused by the third bad fain har--
some Administration policy makersi. lag the- Soviet economy to its knees," vest in a row. These imports increased
from about $9 billion in 1950 to 312 billion
centered ? in. -the Defense Department added another civilian policy maker. to $14 billion last year, a bit more than
and the Central. Intelligence Agency, to "Economies that big don't collapse. The half of that grain and most of the rest
believe that tTe 'West now hasun~ Soviet - economy . just shambles on.
economic ledexa a to iii~t]uenee_ ov-et They're used to bottlenecks. They don't eatand sugar.
g The Polish crisis added a complica-
run their economy well in normal times. lion: Western experts
Now they'll -just run it less well But estimate that the
9Moscow's purchase of 2.i5 million
metric tons of grain from Australia and
the United States last month on 90- to
180-day credits instead of the usual cash
payment, but then reportedly being
turned - down Friday by ?U American
banks- when it sought more- 180-day-
credits.
9An increase in the commodity trade
deficit with hard-currency countries
from $2.5 billion in 1980 to between $5.4
billion and $S billion last year.
These specialists also calculate that
the Soviet trade deficit with the West,
widened by huge. food imports and fall-
ina wnrld- nit nric!Pa_ Hawed S3_5 billion
its own resou
Sovfetfarei
r des a: ,..;
gma
Moscow. T h e y reason that, even if Mos-
eaweAO 11 it42 ta' 901 R000400120001-3
be able to cope simultaneously with the
gro~ritrg credit squeeze on Poland,
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ARTICLE _E. RFD NEW YORK MTES
ON PAGE- _=5( 1 2+IARCFi 1982
The v d en, : ,' tally situated countries was general-?
ing world-class ceccera.
$ s7 In some dgvelopments last week:
out
Mr.. Tarde _llas presuznably had
"Art off=.k of the- U.S. Embassy:. .been. cotmted .an to support
'alai:
told me that they needed to demon .u Haig's claim to "a-rer-:+hei.ming" and
strata the Presence of Cubans in: El'::. ;'irrefutable"- evidence of Nlcara-.
Salvador. TTtey gave me an- option.. . gwaninterventian in El Saivador.._Mr,_
They said 7'could come here or face. L Eai4 andWLiliam S. Casey the Direc-
certain death. All my previous sta3a? tor of Ca:rtral Iatailig ca did better
menus about training in Ethiopia and- with ZS p R^aaly leakproof former:
Cuba werefaiss,'?,>=i:..::;:; =
seaiorofttdadcslle3d in for asiaisi=
Then?reexntiag' Oriaado Jose Tar- a wed brieftU_Tney were Impressed.:
dendila ..I/saixse a bespectacled- a: calling t en psesentatio "very per---,
29-year-oId.Nicasaguan _ guerriiTer+s ,'sua3lve.'^Mr. Haig also assured hie
who had- been cantt>rtr} in E] Salve- it 4' critics that the Administration was
dor, astoruished listeners, at - a State; pursuing efforts toward a negotiated
Department brfeftk Last week and::-. solution, an option that might gain.--
compounded the ? Administration's luster if right-wingers .win on Mar-17
dif iczitiesinseekingcredenceforits.' 23.Today hewastomeetagain todie-
CentralAmerican policy- y .cuss Me sdco's proposals for regional
Administration officials said Mr..: peace moves with Foreign Minister
Tasdeacillas had told the Salvadoran, Jorge Caste ada and, is separate
Army and later the American Em. meetings, Mr. Haig was planning to ?
bassy that h& was specially. trained-'.-?,discuss. the Adarinis#ratfan's Carib
and ddsgateed to Hi Salvador by the -;.. bean* economic economic initiative with the
Nicaraguan Government. s .:: - . = T{s Foreign Ministers of Canada,, V .
But as aapalled State Depar ent_ 14 zuela and Colombia..
:'officials loosed on, he Insisted he had ~~;?: In response to demat:cis -that- thel
-"obviously been presented for our Adreini stration clarify its Intentions, '
poses of propaganda" andproceeded the Chairman of the Joint Chiefs of
to retract the entire acc=t.:Yester= ; Staff,. Gen.; David C. -Jones, told a
; day he was handed over to Nicara-?;.:...,Congressional committee he did not..;
guar authorities andleft iorhamr= :..;''se any dri:umstaix~es tamer which
Mn Tardencillas was presented t6'.__1 we. -would - intervene - with' United-
reporters - as part of Secretary- of States,for .-- I don't thialt that's
State Alexander X Haig's effort-to n y,? aad_ L don't -think that 1
gtsaeraGsstrocgerst-pporttortheA& wcWdbetherigbrccurseofacdon.":
ministration approach, which he said:: .~ -.The mesa gents'-Radio Veecereraas. j
."involves. -, muttilatcralism;r? that. called forpreparaticns for a general.i
avoids the danger-of big b?,cotheris:m- r uprising timed to disrupt the March: i
fromtheCalcssusoftheNorth;"., Za28::votf^.g ..Guerrillas -temporarily,
- 'It was a tall orderis Central Amer - >, garsalyzed. San Vicente. and San. Mt--
lea where r=_Corts nays Ins.
guel FrOvincial. capitals -ia : central
tellroacc coyest opeia~ta y-:.and northeastern El _ Salvador. _and:i
stirred- Memorfes: o . e not-so~'is=-~ killed 17 soldiers In an ambush nearp
0, to t Lit- U
nf~
tterr en"is`odes Cbalataiaago in the the north..
.eluded occz. rib ? Unite d Scat ?:1
:Maifaes (l~liearageta, moat recentl
from 1929 to um), a. Central.-Intell.1-el
te? coup t
R?t)_and acerbic Uui2ed'.4 ?
State~ailitargfatxrbentiQnuTaziaf
a eleedioaa only =;
two weeks away, turmoil in the re--j
gicra's small and weak'rut st ratesd .-
Approved For Release 2005/11/28 : CIA-RDP91-00901 R000400120001-3
 Approved For Release 2005/11/28 : CIA-RDP91-00901 R000400120001-3
National Eroadcasting Company, Inc. All Ri
PLEASE CREDIT ANY QUOTES OR EXCERPTS FR
AND TELEVISION PROGRAM TO "NBC's MEET T
M E E T T H E P R E S S,
'Produced by Betty Cole Dukert
LiveA7ashington, D. C.
Sunday, March 14, 1982
REP. MICHAEL D. BARNES (D., Md.)
Chairman, Foreign Affairs Subcommittee
on Inter-American Affairs
REP. ROBERT K. DORNAN (R. Calif.)
Member, Foreign Affairs Subcommittee
on Inter-American Affairs
Bill Monroe - NBC News
Ken Bode - NBC News
Barry Schweid - Associated Press
Marvin Kalb - NBC News
This is a rush transcript pro-
vided for the information and
convenience of the press. Accu-
racy is not guaranteed. In case
of doubt, please check with
Approved For Release 200p,1g/1281ApQjffN -00901 R000400120001-3
STAT
 Approved For Release 2005/11/28 : CIA-RDP91-00901R000400
=`=:ZARED THE WASHINGTON POST
UI PLC. L1-` 13 March 1982
Senate Conducts
its O n Probe
Of. L ea tirt.Unrest:
ByPPatrick E. Tyler.
Wa:bmgton Post 9art writer
The Senate Intelligence Cominit-
tee ' is conductin;; an independent
review of, a number. of- intelligence
.matters relating to Central America,-
and the committee's vice chairman,.
Sen. Daniei+=Patrick Moynihan (D
-N.Y.), has-:endorse&a' proposal to'
issue an unusual report on the region
to the Senate.
The. comprehensive: review was
first requested on March 4 by'Sen
Patrick J.' Leahy (D-Vt.) 'to deter-
mine-whether intelligence informa-
tion reaching.. policymakers in ; the
Reagan administration is adequate.
and whether it proves administration
iissertiona:of Soviet and Cuban' in..
.tiolvement i the region. The review
also would provide- senators. better
information ' about- U.S. covert- opei
al-ions in -Central; America; =Leaky
said.
The committee staff began a full,;
kale intelligence' review, ? last' week
-and on Monday .-the committee
members -will -discuss whether to, re-
port to the Senate and to the publics
Monday's;-closed session._.will : re-'.
sume a detailed examination `of -iii'
telligence=that ;-the administration
maintains: shows- an alarming mili-'
tary buildr in Nicaragua and a Ni-
caraguan-.supported arms supply line
to the guerrillas in El Salvador. CIA
Director William J. Casey, who con -':
ducted a '.1nitial three-hour briefinz
Approved
Feb. 25, is scheduled to return Mon-
day.
Following Casey's appearance,
committee chairman Barry Goldwa-
ter (R-Ariz) issued a press release in
which he, said, "The briefing left no
doubt- that there is active involve-
ment by Sandinista government of-
ficials in support of the Salvadoran
guerrilla movement."- -_'
Leahy said yesterday that Gold-
water- expressed ' concern that the
oversight committee not get involved
in debating the administration's for-
eign policies in Central America.
But; Leahy said, Goldwater ex-
pressed no opposition. to compiling
an objective and factual record of
the intelligence data that could be,
supported by all members - of the
:.committee..... t n,
Another official said ' there 'was
.some concern among committee Re-
publicans that a full-scale intelli-
gence'- ;review of Central America
.could politicize the committee, which
traditionally . has: avoided partisan
politics in order to have a greater
impact on executive - branch intelli-
gence operations. >,__
Goldwater was in New -York and
could not- be :reached for comment.,.
"It may well be that such a report'
would be written-in five parts, with
volumes. one, two and three made
public and volumes-four and five
classified; but that would also be a
major help," said Leahy: "Then,
whatever debate there .,was: on. the
policy down there- could be stated
with a certain touchstone, something
the senators know they can talk
about in public."
Moynihan, the. committee's vice
chairman and ranking "Democrat,
said Leahy's ; letter - to-- Goldwater
"was sent. with my knowledge and
concurrei ce,'"''- adding that he
thought 'the report was 'something
the committee should do."
Rarely in its history has the com-
mittee issued a report-to 'the Senate
.on intelligence matters....The last
major-report was issued during .the
1978' debate .on the - Pan,una Canal-
T. - _ . .
Treaties.:',
The 'Reagan' a dmirristr-ation ,'this
For Releasee ka-f/!- i-P [3Fa '1"-bb?01 R(l>')#bM200191 etiant to have us
al public displays of irieth,gence data
to buttress its case that Nicaragua is
serving as a command and control
base for the guerrilla insurgency in
.El Salvador. .- '- ' . - ,a.
Also this week, The Washington
-Post reported that Pr' sident Meagan {
had' authorized covert - ooeaations
against Nicaragua with a-- CIA-
supported paramilitary. T force -. of
Latin Americans,' who are to operate
out of commando camps ' .spread
along the Nicaraguan-Honduran
border:
The White' House has. officially
declined to comment about -le co-+,
vert operations, but senior 'gdmin
istration officials. have confir zed to
the three major television networks
,the presidential autherizatiorrfor the
paramilitary force-
CBS News quoted sources saying
that the- CIA would-use no IS.. cit-
izens to direct the paramilitary force
in the field.. rte`; ,~.. i.
ABC News reported that the corn-
'mando force would- comprise' former!
members' of elite U.S. military units
.and would engage in highly 'sensitive
intelligence collection and demoli-
tion work.
NBC News said it had aut iorita-,
tive confirmation of the parareilitary
'force and quoted one `rita:blouse
official as saying the preside.nt was
not especially upset about news 1
'leaks on'the covert operations because the reports convey- the pres-
ident's determination to counter
what he considers ag, cession in Cen-
tral America.
The Reagan' adry.inistration"' this
week briefed a-number of Democrat-l
is leaders and officials of former ad
ministrations on the classified-intel
ligence relating to Nicaraguau, activ-
ities.
Leahy- said the -administrationap-
peared to be lining up "pub C rela-1
tions" testimonials, trom these offi-
cials.: "it may be. a nice, courteous
thing to 'do, but insofar as we [the
Senate] are. the- one- who -are- going
to vote on these :matters--not- the
former-- government 'officials 'it
informedY-Leahy said
 Approved For Release
,0 1 '12 -~C - DM1 r
PQ,1R000?00120001-3
13 March 1982
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 Approved For Release 2005/11/28 : CIA-RDP91-00901R000400 20001-3
JVRT_YG- '`' A_--:?EARED WASIIINGTOil CITY PAPER (D.C.)
12-25 March 1982
g y Dan E. Moldea
IN THE FEBRUARY 6,-1982,
edition of Thee Nation, Bertram
Gross;a professor of urban affairs at
Hunter College, published a story
entitled, "Some -Anti-Crime Propo-
sals for Progressives." The articl - ap-
pealed to the left to steal some of the
right's . thunder by - recognizing the
serious problem ofcrime in America
and to offer innovative methods for
its control
But, like the Reagan Adr-ministra-
tion, Gross appears to be concerned
only about street crime and, like most
liberals, is not at all troubled by. the:
more serious problem of organized
crime-which Gross implied was
something less than organized
Considering this attitude; shared
by both the light and the left:, it is n- no
wonder that the underworld has, an
uncanny ability,: to thrive under
either conservative or liberal govern-
menns.. Conservatives-as we are see-
ing now through Reagan's "New
Federalism" policies--decentralize
power, making it easier for organized;
criminals to buy and sell state and
local officials within tip
dictions. Meantime, liberals con
tine to be inflexible in their defense:
of personal privacy, and balk at the
suggestion of electronic surveil-
lance-which, unfortunately, is the
most effective means for gathering
crucial' intelligence on organized
.crime activities. - Bottomlined,
because of the general unpopularity
of the organized crime issue among
most politicians--the mob can and
does support right-wing causes and
'civil liberties at the same time.
Organized crime continues to be-
Ameri ca's fastest-growing business,
and thus far during the Reagan Ad-
ministration, its opportunities ' for
future growth have been enhanced.
According to a :report prepared by
the General Accounting Office last
December,' -"Organized ` crime. -is
flourishing...(It) is a billion -dollar
business which affects- the lives of
millions of individuals and poses a
serious problem for law enforcement .
agencies.. The effects of organized-
crime on society are pervasive."
Yet, in the President's budget revi-
sions last September, he imposed a
one-third cutback of the FBI's in-
new uridereove operations will ' be
authorized" in fiscal 1982 against
organized crime or white-collar -
crime All of this came in the wake of
a hiring freeze and -dramatic staff
reductions withn the FBI.
Further,. the administration has
severely curtailed the investigative I
and enforcement abilities of the
Securities and Exchange Commis-
sion, the . Internal Revenue Service,
and --the Justice Department'
Strike Forces Against Organs
'a, L
And, on Nov-
12,
the
mini-
stry
tion officially be-
gan dismantling."
the Bureau
co and Firearms of
the Treasury De-
partment-which
vestigations of gambling,` prostitu- has been ex-
' tion, arson-form-profit,' gangland tremely eeffec-
Relea 2_6 000fbbi brJ 3_
mg to an vsis prepared by ~ war against
'Morton of The Washington Post. In. i organized
 STAT
Approved For Release 2005/11/28: CIA-RDP91-00901R000
THE BALTIMORE EVENING SUN
12 March 1982
Con vi i n
photos make
case za aI st .
Nicaragua
By Cord Meyer
WASHINGTON','
THE REAGAN ADMINISTRATION ha's'
irrefutable proof that the Sandinista re'-gime is lying when it denies that Nicara.
guan territory is being used, with Cuoae
_L
hp, to funnel large amounts of arms and-
trained guerrilla manpower into the Sal-f
vadoran insurgency. - ;
But in the face of widespread public,
skepticism both here and abroad, the dd-
'ministration delayed" until this week -in',
revealing the aerial photography that
shows the extant of the internal Nicaia ,.
guan military builduo. 7 "he Reagan tearn?:
,is still ;wrestling with the dilemma of hoia:
to disclose the equally hard evidence'of.7
extensive Sandinista support to the Salvo='-
doran guerrillas, without blowing intelli-
gence sources and methods.
The recent inadvertent use by Sect;!-?'
tary of State Haig of a phony photograph;
to prove the Sandinistas guilty of atroci-
ties made it appear that the adrninistra
tion was grasping at straws to prove its'
.case. But, in fact, long before this week's
public showing of the- photography, the`
State Department had been extraordi-,
narily successful in using this evidence,
behind the scenes to make true believers
of even the most hardened skeptics in for- reason that none of the advanced sateillt?
eign countries. photography was included in this week'3
Last year, Haig was quick to recogniz public briefing.
the critical importance of the European Since it is less r:ccurate, the photogra-
and Latin American social democratic' p`uy from high-flyig U-2 planes does cot
par ties in forming opinion toward events; have to be withl el 7i from Soviet scrutiny.
in Central America. Since these Parties- Its release to the A erican pubLc v: as
had initially celebrated the Sandinista long delayed because of State Depart'
overthrow of Sornoza as a democratic lib- meat concern that its publication might
eration, they were reluctant to believe be taken as an admission that the U.S. has
that hard-line Marxists had taken over, engaged in unauthorized flights oyes
and Haig assigned his brightest aides and. " Ni-aragua. With his credibility now.on
best ambassadors to changing minds. In a the line, President Reagan finally monad
series of secret 'briefings over many
months, what most ' impressed sccial,?sts
dike Felipe Gonzalez of Spain and Caries.
Andres Perez of Venezuela was the`
`American overhead photography, somaef:
which was finally shown the American.
public this week. The skeptical socialists'
could see with their own eyes how Nica'-
lab a was being steadily transformed=
into a menacing arsenal.
The Russian and Cuban derivhtion
!the armament was so clear in the photog-
raphy that Sandinista denials of dean-.
dency on Soviet arms lost all credibility;
Aerial photographs showing burned o&
,Miskdto indian villages corroborated.
To t1 e question of why such convinci ig
evidencE has been secretly shown to for'
eigners but withheld so long from theme
American public, Reagan officials reply,
that in private briefings photographs c b.
be shown and then retrieved, while onto
published in the press they become avaii-
able to everybody, including the Soviets..
The guardians of the most advancezY
'American satellite technology rem' Porting, the Saiva(:oran insurgents with
convinced that the U.S. still has a coni4 Cuban help.
manding lead in the precision of its high- With this bii irtisan congressional f
resolution photography. To expose to - finding clearly on the record after an :-
tiei es partial review of all the evidence, there. s
m-Russians the.fuli extent of that advantag
by allowing them to study actual pho d- plenty of room for debate among Amen - ~
graphs would, it is feared, give them in' "cars as to what to do about Nicaraguan',
valuable help in refining their decepttor intervention bud no reasonable doubt that'
and camouflage techniques. It is for the this intervention is a massive_~ and cont a-
uing reality.
to break this impasse and to order re-
lease of the U-2 phi) tob aphs.
As the administration has clearly irrz
plied in its accusations that the logistical
flow and battle?iel f strategy, in El Salva-
dor are being controlled from sites in
Nicaragua, the arcane and super-secret
National Security Agency _ must have
some access,to Sandinista lines of com-
munication. This irrefutable proof of San-
dinista command and control has be,]
closely held for obvious reasons, but CIA
Director William Casey has presented it
in detail recently to the House and Send
intelligence committees. ( ,
These two bipartisan committees, with
their specially-cleared staffs and full'ac-
ces3 to all intelligence information, cone
close to being an impartial court of last
resort on intelligence matters. However
the American and ,' oreign media gave lit-
tle coverage last week to the significance-
of the fact that the Lhairmen of both corn
mittees reported that there was "con-
vincing" evidence that the Sandinista
government is training, arming and sup-
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 Approved For Release 2005/11/28 : CIA-RDP91-00901 R000400120001-3
?i ='I A:
cry
By James McCartney
WVASHINGTON A top-secret Rea-
gan administration. briefing on Ei
Salvador providedhard evidence of a
gun-running operation from. Nicara-
gua to Salvadoran guerrillas, accord-
in- to a participant.
But it `failed to establish direct
Cuban or Soviet involvement in the
operation, he said yesterday.
The participant; a former high-
level government official who asked
not to be identified, said-the evi-
dence indicated a "fairly sophisticat-
ed, - relatively well-financed.. and-
supplied" system with: advanced
corn munications facilities and an
i rn nressive organizational structure.
PHIT_,AD 01PHIA IN UIREER
12 MAR CH 1982
The former official said the admin ! was to have voted on a r sot ution to'
istration's' presentation did not seek' nullify President Reaga?.'s declara-
to show the origin of arms that have' , lion that the Salvadoran f w ernmentl
arrived-in Nicaragua. Presumably,; "has taken explicit act on to end
he said, they could be coming from; human-rights abuses." That declara-
Cuba or frorri some other communist
country, but no attempt was made in
the briefing to document arrival
routes.
But after the arms reached Nicara-
gua, he said, the administration
briefing showed they' were being
redirected into El Salvador largely
on the ground, most of them through
Honduras but some through Guate-
mala.
According to the administration, a
small portion is going by sea, he said,
almost none by air. He described
lion, made Jan:- 28, was necessary,!
under a law passed last bear, before)
any military aid could be given to El
Salvador.
But Rep. Daniel A. Mitt (D., Fla.)
obtained agreement to f ~~stpone ac-
tion until after the )Marc) 28 election'
in El Salvador, arguing that action]
now could touch off increased vio-
lence in the Central Amc r ican coun-
try
The administration is Asking S165
million in the next fist ii year for
economic and military a ,sistance to
lie JQtLL 11 A.JU11 as
the Salvadoran junta.
tion's evidence that arms were being Ight enough to carry. He said the l,
shipped from Nicaragua to El Salvia- evidence presented at the briefing, Sen. John Glenn (D., 0 ciul, char(;
dor to be well-documented and "con--I suggested that it would be extremely that our Glenn
poly, , is c a dead
difficult, because of rough terrain, to] ing
viButlie: end," announced. yesterc Eythat hip
But he said there was no evidence' cut off the flow. was co-sponsoring . a re lotion call
in the briefing of direct Cuban in- He said that as nearly as he co sE
uld ing for the United State. to enc al-
volvement. "The Cuban tie," he said, tell, the administration was unable
to nrrniertn arrnrata r-timsitPS of the age unconditional negoti ations for a ...
at all waspresented of a Soviet con. volume of the arms involved but
nection, he added: could document that arms were flow The Associated Press cc n
for certain, be said, whether Nicara- . He would no[ discus, n1EeuEgencc-i
guans or Cubans are. running the techniques that were used, but he`
operation only that' Salvadorans' said; they were familiar to anyone
probably are getting substantial out-, who had worked at high levels inside
side help-: the government.:.
The former official was one of 26 -He said the administration's case is
members of a group, including prom- "not fundamentally built on people"
inent officials of past Republican and -. meaning intelligence agents - or
.Democratic -.administrations, who on photography, although .there are
were- invited .Wednesday.toview } some. photographs showing "camps
evidence of Nicaragua's role in sup- and things like that
plying Salvadoran insurgents. Critics of-the administration, such
The group was briefed by Secretary as, Rep. Clarence Long (D., Md.),
of State Alexander M.. Haig -Jr. and argue that the guerrilla movement is,
CIA director William J. Casey in what largely'home-grow t, a result of.cen
seemed an-obvious effort to bolster turies of economic oppression.
the credibility of administration The administration argues that the
contentions that Nicaragua and movement has been inspired largely.
Cuba, with Soviet encouragement by forces in Cuba, supported by the
and support, are. supplying the guer- Soviet Union. Haig has said the fight
rillas, against the Salvadoran guerrillas is
Haig said last week that the admin- - part of a-global struggle against
istration-- has. "overwhelming and communism: _
irrefutable" evidence of Nicaraguan Critics have sought to cut off mili-
and Cuban roles, but he has declined tary aid to the Salvadoran govern-
to make.the evidence public, saying ment, but yesterday a House subcom
that to do so would compromise inte'l-i mittee postponed action on the first
Ni gr r}~1 challenge to a resi-
ligencesourc co
~ e~i e'a~ atdddl A 5 e H ~ftl6stE} ~zf
:a~agua
that it. is sii-;ifng arms to the Salva- for continued military aid
doranguerrillas =-- ~? es>;>. *,koreign..Affaiss subcommittee
STAT
 STAT
0
II March 1982
STAT NOTE FOR:
STAT FROM:
SUBJECT:
STAT
STAT
CerTSwARff? 84fAF W V 2005/11/28: CIA-RDP9~1-009
18 February 1982 DCI Interview
with Joe Fromm, U.S. News and
World Report
Attached is the 18 February transcript
of the DCI's interview with Joe Fromm.
'This. copy has the Director's corrections;
the original was returned to Joe Fromm for
final publication.
Please call if you have any questions.
Attachment
cc: C/PAD/OEXA w/att./~
OEXA Registry w/att.
DD/OEXA file cy w/att.
Approved For Release 20.05/11/28 CIA-RDP91-00901 R0Q04001'20001-.3
 fit. ~ ..T; ,App~o ,gbFor Release 28r/11IA/ -`1 -00901R0004001
011 ~: 11,11
11 March 1982
By John M. Goshko
? Haig Defense Se.retaay',Caspar
NV. Weinberger and some other. sen-
ior administration officials refused to
comment on a- report yesterday in
TheWashington Post that President
Reagan has approved a $19 million
program to destabilize the revolu-
tionary Sandinista-dominated gov-
ernment in Nicaragua. Instead, they
took the position, described by Haig.
as "consistent and longstanding.pol-.
icy," that the government does not
comment. publicly on covert . activ-
ities, but they added that their si-
lence should not be interpreted as
confirmation of the report.
However, White House counselor
Edwin Meese III told a journalism-
seminar here last night that The`
Post report placed the administra-
tion in a "totally untenable position."
Meese said, "Here is a situation. in
which the security of the country is
seriously affected, whether the arti-
cle be true or false. If it is true, then
vet' hupart t cep rt; vital to ourf
i : r i? ant ,,t, ,.tact to the silt.
cess of any such rrissiun have been.;
revealed. If it is false, then you, have
given an adversary a great.opportu-1
nity for propaganda'-.
'Haig' said the administration has
--rot>rejected Mexican President Jose
Lopez Portillo's offer to act as a me-
diator in trying to end the Salvador- {
ari civil war and ease the tensions
between the United States and Nic-
asagua. The secretary said he. would
continue discussing the idea with
Mexican Foreign Minister JorgeCas-,
taneda in New York this weekend; in
another hint that Washington wants
to: keep alive the possibility of even-
tual negotiations, Haig expressed;
hope that after the March 28 elec-r
t ions for a. constituent assembly ?
Secretary of Statee Alexander M.
flaig. Jr., speaking against a back
ground of - mounting. controversy
about U.S. policy in Central Amer-
ica, told Congress yesterday.thai; cut-
ting off military aid would be "a fatal
blow" to the government of El Sal-
vador in its struggle against leftist
guerrillas.
"I think it would be 'a catastro-
phe;' Hai;; said. "In practical. terms,
the guerrillas are not about to over-
whelm the country. But `American
arms are a crucial factor, even more
in political arid--psychological terms
than in actual material terms."
The secretary's testimony before a
Senate subcommittee came on a day
that saw a rapid-fire series of devel-
opments continue to push the, de-
bate'over El Salvador and Nicaragu&
to the forefront of congressional and:
executive branch attention. Among,
eTwenty-six prominent .officials
of past Republican and Democratic
administrations-emerged from a clas-
sified intelligence- briefing at the
State Department. to .say- they hady
been given convincing-evidence: that
'the Salvadoran.- ;uerrillas' are being
aided, supplied and guided- from out
side. by Cuba and Nicaragua. Hose
ever; the former officials also; agreed
that the evidence- is so' "sensitive"
.that it cannot be made public with-
out causing serious damage to U.S.-
ability to collect' intelligence irr the-
future.
Approved
induced. to lay down their arms an
For Refeatist2005fht/281 flAf
the Salvadoran people.''. ;_
iscite that would express the will
4',Weinberger an,
.Jones, chairman of
of Staff, reiterated,
fore the House For
mittee, that the ar
'nd plans or intenti
troops to Ei Salva
its support _-
ciuilian government there to in-
creased military and economic: aid. -
ELj~The administration, obviously
-concerned that its p,iliry toward
Central America coulc be derailed
by persistent questions about wheth-
er the United States is tending for a
new Vietnam-type involvement, this
week mounted a campaign to swing
?public opinion behind is approach.
ri'lie effort began `I aesday when
enigr intelligence officials gave re-
porters a detailed briefing, including
the, display of blowwup: of aerial re-
connaissance photogra:ihs, designed
to show that Nicaragua is building a
sizable military establishment with
Cu',:,; Soviet het second
c +,.i;. y est tday the brief-
,,ing,aimned at enlisting he support of
former officials and w!th Haig's ap-_
rpearance before a Senate Appropri
ations subcommittee that oversees
foreign aid.
. Vncler heavy que:itioning from
Republican and Den ocratic men-
bers, Hain reiterated his past charge
that the .Salvadoran ,uerrillas are
"largely controlled" from the
Nicaraguan capital of Managua. He
said the principal flaw in the Max-
peace initiative, which he as-
. serted is basically the same plan pro-
.posed by the United States and re-
jected by Nicaragua lost year, is the.
lack of a requirement that Nicaragua'
"commit itself to-cease and desist" in
"We are exploring every; feasible
means possible to.. bring- about -a
-00901'F Q49Q6118Q6&14 said. "But this'
is a '.two-way street, and it requires.
reciprocal ' obligations by those - who`.
STAT
STAT
 U!_
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Whatever one's opinions are about the
United States' role in El Salvador, they al-
most inevitably must rest on the answer to a
single question: Is the dissidence in El Saiva.
dor a true indigenous rebellion with mass
popular support, or is it directed and control-
led by foreign - Nicaraguan, Cuban and
Soviet - elements?
In the absence of concrete evidence in the
public domain, the answer to this question
tends to split on political grounds. Those con-
doning the administration line accept the
administration statement that the foreign ele-
ments are in control. Those opposing the line
reject the statement and demand "proof."
Secretary of State Alexander Haig has
now stated "the operations of the guerrilla
forces inside El Salvador are controlled from
external command," the evidence for this is
"overwhelming and irrefutable." CIA Direc-
tor WW Casey also briefed the Senate
InteIlige enceommittee, leaving no doubt
there was active involvement by Nicaraguan
officials, including the use of Nicaraguan
territory to move arms, munitions and per-
sonnel, with guerrilla HQ elements in
Nicaragua. .
Haig would give no further details in pub-
11c, stating it could jeopardize U.S. intelli-
gence sources. This is understandable,
because the sources are unquestionably CO-
MINT - communications intelligence and
while the situation Is hardly analagous to the
wartime security surrounding our ability to
read the Japanese Purple code (Haig would
not even have hinted so broadly were it so),
the United States still does not wish to con-
firm publicly that it makes use of COMI IT.
There are;- actually, two. forms = traffic
analysis and cryptanalysis. Even if codes
cannot be read, the nature of the traffic gives
massive information. Even Unbroken codes
can be identified. Message headings include
the originating command, and the recipients.
HOUSTON POST
11 March 1982
These indicators are not difficult to puzzle
out. The originator's location can be pinpoint-
ed by direction-finding - DFing - and in
short order chains of command can be work-
ed out, with their locations and relationships.
It is no problem, for example, to trace a mes-
sage originating in Havana, relayed by a
Nicaraguan station to an element in El
Salvador.
Code-breaking - cryptanalysis - is touch-
ier. The major powers use machine-generat-
ed codes that can't be broken, but such in-
stallations are only found in permanent
diplomatic compounds and can't he used by
the military in the field. Portable cipher ma-
chines today are extremely sophisticated -
but not unbreakable and, while many can be
read, the United States is not about to con-
fi which ones.
Britain's ability to read the German Enig-
ma machine codes in World War 11 (thanks to
brilliant work by pre-war Polish cryp-
tanalysts) was a major help in winning the
war. The British refused to declassify that
triumph until 1974. Hundreds of Enigma ma-
chines had gone to dozens of smaller coun-
tries, which, to the delight of Britain and the
United States, happily continued to use them
for decades.
All manner of intelligence can be milked
from COMINT. The Cuban command struc-
ture in Nicaragua - its ciphers, networks,
traffic (and even the "fists" of specific opera-
tors) might, for example, be paralleled else-
where - say in the traffic linking the Cubans
in Angola and the SWAPO guerrillas striking
at Namibia, an exa< t p aralllel to what is hap-
pening in El Sa:vadur.
Access to CC :1L' T, or educed and distrib-
uted daily by the National Security Agency,
requires a special elerrance - not superior
to, but quite disti- ct from, a Top Secret
clearance. COI vT goes to senior officials in
the White House, th, Pentagon. the State De-
partment and the CLA. it also goes to ana-
lysts who require such information in their
duties.
It was C011--,\T hat produced the Libyan
hit team furor. It is COMI T that has con-
winced the administration El Salvador is the
target of a Soviet r,duced and Cuban and -
Nicaraguan-supported attack, disguised as a
popular rebellion.
If domestic pressure mounts. the adminis-
tration will almost nque-tionabiy rely more
heavily on COMET to support .heir stand -
congressional foreign relations and intelli-
gence committees have already been briefed:
The danger is not that the enemy will
"change the codes' - the keys are changed
daily in any ?'rent tad instituting a complete
system change, w:th new equipment, is a
major undertaking, impossible to effect in an
active combat situation.
COMINT - its progress and immediate
fruits - will never enter the public domain.
Distribution of the ruits is severely restrict-
ed even within the ,overwnent. It does exist,
though, and government's job - for any
administration - v cu'.d he far easier if the
public accepted the fact policy is often
shaped by intelli,c_-.ice that can't be dis-
closed.
..{
Morris served :7 yeas with tie CIA SePore retiring I
In 1977. .ft
Approved For Release 2005/11/28 : CIA-RDP91-00901 R000400120001-3
 Approved For Release 2005/11/28 : CIA-RDP91-00901 R00040q
=PEAR, ED
Approves:'
o ert Plan
.11 icaragua
By Patrick E. Tyler
and Bob Woodward
Washington Pest Staff Writers -
President. Reagan has authorised
covert operations against the Central
American nation of Nicaragua,
which, administration officials have
charged, is serving as the military
command center and supply line to
guerrillas in El Salvador.
According to informed adminis-
tration officials, the president has
ruled out the use of U.S. military
forces in direct anti-Nicaraguan op-
orations. But the authorized, covert
plan directs the CIA to begin to
build and fund a paramilitary force
of up to 500 Latin Americans, who
are to operate out of commando
camps spread along the Nicaraguan-
Honduran border.
The officials stressed that it will
take months for the paramilitary
force to be recruited, trained and
positioned to begin operations.. They-
(lid not say. precisely when. the cross-
border operations are. scheduled to
begin.
As part of this plan, the comman
dos eventually would attempt to de-
stroy vital Nicaraguan targets, such
as power plants and bridges, in 'an
effort to disrupt the economy and
divert the-attention and - the resources of the government: Mk,
strategists believe these covert ''op-
erations inside.; Nicaragua will slow
the. flow of arms to El Salvador and
disrupt what they claim. is a Soviet
and Cul an-controlled government in.
Nicaragua,
Operating under 'a $19 million
CIA budget, the. planned 500=man
force could .be increased in. siz'e.if
necessary, officials said. The CIA
force would. be supplemented by an-.
other , Latin - American commando
force of up to 1,000? men-some. of
whom currently ' are . undergoing
training by Argentine, military offs-
resistance:, ,
vials f1 aa -' : fi_n a- -;,
Approved For ReleaseCs0t11%28 : CIA-RDP91-009018000400120001-3
THE WASHINGTON POST
10 March 1982
This is the plan for CIA covert
operations first reported in The
Washington Post on Feb. 14 as part;
of the Reagan administration's strat- i
egy in the region. At the time, it'
could not been determined whether.
the president had authorized the
.CIA's plan to build a paramilitary;
force against Nicaragua.
Several informed sources now say
that the president did formally au-
thorize the proposal, but the precise
timing of his authorization could not
be determined. It may have occurred
late last year.
The covert action proposal was
developed by the CIA and. first
presented in detail to President Rea-
gan by CIA Director William J,.
Casey at the .Nov. 16 meeting of the
National Security Council. It was
supported by Secretary of State Al-
wander M. Haig Jr. and Defense
Secretary Caspar W. Weinberger, ac-
cording to knowledgeable officials-
Administration officials familiar
with the CIA covert program
stressed that the decision to focus on
economic targets was based on a de=
sire to disrupt the Nicaraguan arms
supply line to El Salvador in a man-
ner that is relatively inexpensive and
least threatening to the civilian pop-'
ulation.
"If you blow up a clam, you cause;
a lot of trouble, but, you're not kil-'
ling people," one high-level official
said..
Ire his Feb. 1S press conference,,
Reagart- was asked if the- United!
'States was planning, covert opera I
tions in Nicaragua, but he declined
to comment.
Nicaragua currently is =ruled by.
the Sandinista National Liberation.
Front, whose guerrilla forces over
threw the_ government of dictator
Anastasio. Somoza in July .1979.' Honduras has a close military re-
'lationshi _with the United States;)
and Honduran officials = fear. that the+
political upheaval in EI Salvador and j
Nicaragua will spill into-their .counf
try. As a separate part "of the U S
strategy in the region,-the U.S. mil=
;op
itary currently is engaged in two
erations in neighboring.Honduras toy
indirectly support anti-Nicaraguan
efforts , informed administration of-
ST1 T
According
NSC records,
al in Nove:nt
and conduct
military opr
Cuban preset
nista support
and elsewber:
The CIA, in
thorization fc
military forcE
program shot
that funding
force describt
Covert opt
proposal, ac
records, are i
s `Build p
tral America
opposition front trial wuuiu uu ,~a i
tionalistic, anti-Cuban and - anti-
S, -
-9 "Support.- the o~)position front
through formation nd training of
action teams to cob-ct intelligence
and engage in paramilitary and po-
litical operations in t14icaragua and
elsewhere.
P "Work primaril' through non-j
Americans" to achieve these covert.!
objectives, but in sor to cases the CIA!
might "take unilate -~I paramilitary
action--possibly usi ig U.S. person-i
nel-a gainst special ,;uban targets."
After the initial 1 resentation, the!
CIA proposal was tu:-ned over to the
national security pl inning group, a
subcommittee of the 2N-SC, as a draft
"presidential findin ,;' which statesi
the need for specit'c covert opera-i
tions. Under natiorat security stat-
utes, no funds can 3e expended for
covert actions "uni a the president
finds that each such operation is im-
portant to the national, security of I
the United States."
Senior U.S. def,-nse, and intelli-
gence officials . hay - said in. recent
weeks that withou. a slowdown in
the arms supply tc. El Salvador by
air, land and'sea r lutes from Nica-
ragua, the position, o government
forces in the. war-t( rn country could
deteriorate retpinly, potentially
prompting an escalation of Salvador=
an requests for U..i. military assist-
ance. Such requests arelikely to run
into strong congre 3ional and public.
.`.. _ ..,,~
 0~!
.App d For Release 2005/11/28 CIA-RDP91-00901R000400
THE WASHINGTON POST
10 March 1982
By John M. Goshko
,'l. hlmton Post8tatt Writer
Mite Reagan administration, seek--
ing to swing public' opinion behind
its Central America- policies, yester-~-
day staged a display of blowups of
aerial photographs to bolster. its-
charges that Nicaragua is engaged in
a massive military buildup that
poses a threat. to its neighbors. .
The photographs, projected onto a
giant screen in the darkened large
auditorium of the State Department,
were the highlights of _ a lengthy
press briefing given by Adm. Bobby
R. Inman, deputy.- .director of the
Central Intelligence Agency, and
John Hughes, deputy director of the
Defense Intelligence Agency.
As described by Hughes, the pho-
-tographs purported - to : show
Nicaraguan military :installations.
built according to an alleged Cuban:
model, airfields with runways length.;
ened to handle Soviet Mig jets that,
Vie United States ':claims are- ear
marked for Nicaragua, and Sovie
tanks and arti1le&in place at some.
of these installations
The two officials.. Also- ahowed a
series of before-and-after photo
graphs showing :Indian .villages near'
Nicaragua's bordei with. Honduras
Nicaraguan. huthorxties. Tha.:admiiz
istration has charges aragua with;
the Miskito [ndiangand other tribes':
that lived in the arV-L..
lected by unspecified' aerial r econ
naiasance-'methods;ithe briefing toast
largely a reiteratioin.:of- information
that;: the administration-:: previously
Its main point,,,ich Inman and
Ilughes tried- to-'drive =home, with a:
drumbeat of tough rhetoric, ;was the,
tionary, , Sandinista-con r goo-;
enment;- 'Roth 'Cuban' and'- Soviet
halm-. iR hx~ili3intr aar`sizriv Aose size`,
needs for, legitimate self-defense.
Inman said. the intelligence commu-
nity believes Nicaragua's goal is to
create a standing army of 25,000 to
30,000 and a ready-reserve militia of
between 100,000 and 150,000.
He added that while the purpose
wasn't clear, he believe: the "pattern
of Cuba" is being repeated in Nic-
aragua-and that "the military infra-
structure is there to turn the country
into a Soviet bastion" from which
campaigns. of political intimidation
or outright. warfare can be waged
against the rest of the Central Amer-
ican isthmus.
"This time, the ocean barriers
aren't there," Inman said. "They can
move much more easily into Central
American countries."
What -set yesterday's `briefingg
apart,froni acc
,-f Or;n7 ac'i stn2ina area and ( tureS.
y one of the bases shown wa, cesignea
gencies Decla co"uaandcenterfort,'tet;uemmovo.
for i,`tetrair rb of special array forcs
Initalhgencs Agencies-
_ by . meat in El Salvador. Nicaraguan lean. he said. The base, on the s-o e of La e
Formes Are `Vastly Bevori e:shave deniedthecharg:ea. gua, cont insasawdustnitthathe
r,iana?
Today's presentation, Admiral Inman
r '. said, was the first of a series of intelli- said was used for training i-i ha id-'o-
well as s min e art"air-
h
Any Defensive lee _ cans bnei -'gs scheduled for this week and
. _ _ . _..1...., ~, - ,-V, ~t't c
ea
used to re
i
n
I:.talHgeace~ ~ ~ 0~4~~IF t~$19~ ~p 01 8 p61 *i& -ie'oriefin~
detersive purposes, said="Joohn '1. areas are built along Cuban design, e said, the result of a systematic effort by
VL al putt' Director O1 t Defenstx said. the Sandinist Government to d:stllace
Fo*example b1r Hughespresenteda t`
eIndia
s
oy rtetceagan .ur~u~,~:uuuuwi:.~:=.a
againstairfieids,
ublic about Soviet
ss and Lhe
C
p
ongre
4
SyP1?IILIPTAUBMAN r ,- and Cuban involvement in Central Tank PlacernentNot-d
s;ari~Mto?:~?t+e+-Yortirma.--' - . America. External support for theguer- At several garrisons, M-- Hughes
~vASHlNGTON Marcfz9-=TI2e.Rea. r-Ila movement in El Salvador will be noted the placement of whit he said
an Administration made- biic,today the focus of oneof thesebrifings, Admi- were Soviet T-54 and T-55 ranks and
g allaruansaid. Soviet antiaircraft guns. He s-tid?that
a_ ::al reconnaissance photographs that ' Nicai a at present has 25 S )viet tangy; t
i-:eiligence officials said proved i3ica? Public Doubts Are Noted gu ;
armed with 1GC-millimter guns-
;...n with Cuban and -Soviet-assist. According to senior Administration In addition, he said, the United States.
a_.ce, was assembling the largest Mill- of icials,thedecisiontodeclassifysome has evidence of the _preserce of two
ta. force in Cent; al Atneric .- = ? intelligence infarmation about by Sec- Soviet Hip relico Tees, 12 seB-I t t armored
-the Administration assertedthat thet America was made this morning by Sec- personnel carriers and sev ral heavy
rilitary buildup posed a threat-to Nita- rein' of State Alexander M. Haig- Jr. amphibious ferries capable of trans
g
r a's neighbors and has.ugset t.'i and William J. Casey. the Director of porting the Soviet tan'cs acrd s rivers-
Central Intelligence. It ended severs rneconstnctionofnewgarn-ions has
weeks of internal debate about whether been accompanied by the irr3mve has
Ling that Vicar avian Ieader todisclosetl:einforination,they said-
had lied about the e-'tnt.of the militarj! . TheAdrninistration, the officials said, and expansion of at least fou
~, according to Mr. Hughes- He d that at
growth, Adm. Bobby R. Inman, t..e how the release of the raw intelligence airbases,
i. puty DirectoroiCentra1.Intelligest~e;'datawill help dispel public doubts about Bltiefieldsairbase, forexarple,on[he"
said: "It's time to get some concern In Adr-'iriistration assertions of outside in- Caribbean coast of Nicara,,ua, aerial
Jan showed
' t:Ts country about their military builds terferencein Central America. photographs
ction of a taken new in Jarsu.ir runway:
up. It's vastly beyond-. any. defensive The aerial photographs made public The t uctionra a he said, 4 s 3,100 feet
;.` today were taken in recent months dun- Ion?, far too short, he-added, to handle a
ing manned reconnaissance flights over ? fl,
3?itotsTtefaorted-UndeLTaainiug Nicaragua and show evidence of major iiyarmed bi[G fighter
At a press briefing at the Statet?D military construction, according to Mr.
par[:Went, Admiral Iainati :sank the Hughes, This is the kind of ai..iel i expansion
ui-,es, who was described by Admiral for an air force that claims to have only
. ~ , . in Nita-
United States believed Nicaragua's.Sanf Inman as the Government's premier a few The O old overall Cubes said, tctais more
tranding army of 2S,CCti to 30,000 m Mr. Hughes, who conducted a similar than 6,CM0 advisers: 2,000 military and
s
. about the introduction of
security advisers, 500 medic 1 advisers,
e-dipped with Soviet tanks andhelieap~ briefing in I
tern. The nation's total military lore ?-'L e Soviet Nicai^agt missiles ran in Army Cuba, had said 49 today garristh at ons, 600 government advisers, 2,G0 teachers
including militia, is nearly 70,000, easily 35 of them constructed since the Sandi,-'- and 750 constriction worker;. the largest in Central Amens, Admen- lets gained power- Admiral Inman said that there were.
istration officials said:'-- . ":~_ , , He also said that imph-ovements were 50 to 75 Soviet advisers in Nicaragua , in-
In addition, they said; N1C3 :a::i3 being made atNicarao atNicaraguan ai~'olvedprimarily inadvising ;dieNicari?
soon to receive advanced jet- fighteZ eluding the extension of runways, to ac- guans. about military organization and
p anesfroratheSovieL Union 3ndhas 5) tA7 madate advanced MIG aircraft tactics: pitotstr'aininl,-inBulgartatoflfthem_ Y built in theSoviet Un'on *s ..: .: Today's presentation also incii:ded a
Based the pace of nets airfield PbotographsAreDispIayed series of photographs showing )tiliskito
Indian villages in northeast Nicaragua
caristtuction on ;,"and- the :de- ""' tent d. To support-'those assertions,- Mr. on Jan 4,1482 and again on Feb. 23. The
zew ground force installations, It is evi- Hughes displayed a series of oaks bed first photographs, Mr. H-. goes said,
deny. to-its -that-:tlte Sandinistas-are photographs showing military. insalla-
p first showed populated, fundionrnR villages.
achieviagmilitaryforcelevelsxaexcesa tiors in operation-or under constriction ! The second photos showed the sa me vi llage t-
.of those:-nuiiaally-r'egtured'.p ly`~or)ia Nicaragua- "Most of these garrison4 lager with all buildings destroyed, he.(
rison at Villa Nueva. Fie sal at the said that in a visit to Wasainngton last
week, Nicaragua's Minister of Agricul-
ture, Jaime Wheelock Roman, lied
 STAT
Approved For Release 2005/11/28 : CIA-RDP91-00901
NEW YORK `i I NHB
10 MARCI 1932
0_~+ P. O'E
Following is a transcript of the the largest in Central America a :d
1 .when John Hughes briefed the evi-
statements on the military huildup in dence, fromphotography, of the Intro- totalsupto70,000rnen.
Nicaragua given yesterday at the; ductonofnhissilesinto Cuba. Based on the pace of new alrtield
.State Department by Adm. Bobby R.; .~ I will field your questions after John construction avid the development of
Inman, Deputy Director of Central In- has finished within the degree that I ! new ground-force i:statlaticrs, it is
telligereca, and John T. Hughes, can,-. And I'll be assisted by :Tim Wil-; evident to us that the Sandinistas are
Deputy Director for Intelligence and, =liams, the director of D.I.A. John, over! achieving military force levels a~?d
External Affairs for the Defense Intel :tQyou. f capabilities that are in excess of tcse
Iigence Agency, as recorded by Thee 'Hughes: Thank you. Indies and l normally required purely for defe.n.
antlemen, our purpose this afternoon sive purposes.
O
- )- Yor`t dews through the facilities) .cis to review some of the sensitive intel- We believe that they have alrea ly
of the Ca'~IelVews l7ietwark: ` oence available ro us on the continu-) upset the military balance In Central
--Mr. Inman: I'm Bob Inman. I'm
here this afternoon because I'm con-
c;rned and because I'm angry. I'm.
concerned about insuring that you,
rand through you the public, has a clear
understanding of what's been worry-.
mg those of us in the intelligence corn-
raunity for months now. That's the
military, buildup in Nicaragua and
-what it portends for this country.
I'm angry because I've watched,
over the past couple of weeks, public
servants trying to grapple with the dif-
fic llty of conveying information while
protecting critical intelligence sources
and methods and finding that they're
sandardly greeted with, "How can we
believe you, unless you show us all the
-detailed evidence."
And over the, weeker^.d, we were
treated to the occasion of the visit of
?Minister Jaime Wheelock from Nica-
.rngua, who used the platform given:,
him to talk at substantial length about;1
what wasn't happening in Nicaragua.
And as you will see from what we
have to say, he lied directly, and no
one seemed to challenge that process,
.at least not in the stories that I read.
And today we're not going to deal
with El Salvador and the events there.
That will be coming, a series of events
later in the week. But we are going to
respond today with some declassified
intelligence on the nature of the
-buildup that we've been watching for
hone time
oll e si
Th
p
e -- -, request that he exercise his authority] purpose to Somoza's National Guard,!
.o declassify some manned recornais gradually have been built to a force of
s.ance imagery, or photography, which five to six thousand men.
jr "believe you will find makes a very , The regular military forces have,
subbstantial, different case from that
grown even more quickly from a small
"which you heard from Mr. Wheelock ! initial force of 5,000 to a large, active-'
over Lie past weekend. duty army supplemented by even,
-We're privileged to have with us' larger, militia and reserve elements.
today. to present the evidence to you, - This combined military force is howl
John Hughes John has been in the in-
telligence business now for slightly; raptly. Next graphic.
over 30 years. He is the premier photo
,-interpreter in the Lplj Release 2005/11/28 : CIA-RDP91-00901 R000400120001-3
,'community. And those you a,
?historicai interest.may_r'call.in,1962' ,
Ing Nicaraguan military buildup. In America. This is especially true since
-tthis review, we will exhibit reconnais- their neighbor to the south, Cc :a;
sancta photography of Nicaraguan Rica, maintains no standing array-
m military installations and military Let me now share with you the e 'f-
-quipment. Bence that is available to us.
-We will also show comparative First graphic please. In any dlsc.s
coverage-that is, before and after- sion on the Sandinista military buiA
border, which have been systenati-
cally destroyed by the Sandinistas.
This presentation has two basic ob-
jectives, with respect to the Nicara-
guan military buildup: first, to de-
scribe the nature and growth of Nica-
raguan military facilities over the
past two years, and the inherent
Cuban design they represent; and sec-
ond, to review efforts on the part of
Cuba and other Communist nations to
provide modern and upgraded mili-
tary equipment to the Sandinistan
,ground -- armed forces. _
-Could we put the lights down please?
'-Prior to the overthrow of Somoza by
the Sandinistas, Nicaragua main-
tzined aNational Guard with the
strength of about 10,(x0 men.. This
military facilities. tit tree present ui:e,
we have confirmed from aer al
photography and other sours 49, ic-
tive military garrisons. The amaz gig'
thing about that figure is that 36 of
them are new military garrisons since
the Sandinistas have taken pow -r.
Thirteen of the garrisons to make :-?
the total of .39 are old Somoza ga rris, ins
that have been refurbished to accor~c l
date the Sandinistar military units.
Most of these garrison areas c -e
built along Cuban design. In fact, eve,
have evidence of facilities in Cuba u` at
we'll exhibit today that are seen ink
;
Nicaragua.
14 Installations - P
The installations we're going to t ith,
about are shown, or highlighted, here.'
the country in an internal security role! lotions. They are rot all of them the e,
and had very little heavy military some of the main ones, here marl --di
equipment. - by the military symbol a standing : al
SizeolftlllitaryForce dier. Fourteen of them, plus four haw;
airfield activities, we're watch agi
When the Sandinistas came to very carefully at Puerto Cabez is,
power, they immediately began or- Bluefields, Montelimar and nc'arl
ganizing regular military forces and a Managua itself. And, by the way, till
strong internal security police force. inset of Lake Managua is enlarged in
-
the upper left, where you can see --he
town of Managua and the newly est.:b-
Iished ground-force garrison that
we're going to be discussing in the c-m-
text of today's presentation.
This is Sandino Airfield, the main :n-!
field.
As I mentioned a moment ago, at of;
these take on a Cuban design and char-1 -
acter. Let me show you what we :re'
saying on the reconnaissance photig-
CON=UT -Q,,
 Approved For Release 2005/11/28 : CIA-RDP91-00901R0004001
A T ' c. _ ` - V u E E NEWSDAY (NY)
ON 10 March 1982
By Daniel Kahn
Newsday Long Island Business Editor
Woodbury--A Central Intelligence Agency official
yesterday shared some of the agency's concerns with
members of the Nassau-Suffolk business community,
and took the opportunity to do some lobbying.
J. William. Doswell, the CIA director of external
affairs,' called attention to two "crucial issues" now be-
fore Conti ess: Public identification of CI i agents and
easy access to sensitive material through the Freedom
of information Act
The proposed Intelligence Identities Protection Act
would bar the publication of the names of agents, he
said, without threatening penalties for . inadvertent
disclosures."
The Freedom of Information Act "galls me," Dos-
well said. "The KGB can-and does--request informa-
tion which. Nye must provide by law," he said, and the !
CIA "loses information" from potential sources that are I
dried up by the possibility of future disclosure. The CIA
and the National Security Agency should be exempted
from the act, he said. Doswell invited the 200 businessmen. attending
the Long ? Islas d:.Asso6!P`t1cn''s,;World-Trade.Club lug=;
' cheon at the Crest Hollow:: Country; (;lub to express
their support- of the CIA positions to their conorress-
The appearance apparently marks- an effort by the
CIA, under new Director William Casey, to reach out to
the public. A similar invitation fron. the LIA 18
months ago-was rejected by the CIA as sot in keeping
with its policies. Doswell, a former newssa per publish-:
or and head of his own public relations firm in Rich-
mond, Va., joined the CIA in July. _
In his address, Doswell touched on w:- at he termed
three areas of major concern:
0 Terrorism as a tool for political act on is growing
rapidly worldwide. Since 1930-ard for tine first time--
terrorism has been "sponsored by a na-ional govern-
ment on a large scale." (He later identifid the govern-
went as Libya.) Primary targets are U S. citizens or
their properties. Americans-particularly business-
men and diplomats--ere the targets in two of every ive
incidents. Latin America and the Midea t are the ma-
jor areas of terrorism,_ r .th ;Europe "no far behind."
0 A low self-sufficiency of such critical resources as
cobalt "may spell trouble" for the United S= tes, since
any loss of the:roteurces ."would bring a shock to the
economic systcrri? The U ited States "can't determine
its own fate when foreign hands are on the throttle."
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 STAT
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RADD 1V REPORTS, 1 NC
The Today Show
WRC TV
NBC Netvork
March 8, 1982 7:00 AM
Colonel Pluammar Qaddafi Interviewed
Washington, DC
JANE PAULEY: Chris Wallace spent this weekend in the
Middle East, where he got an exclusive interview with Liby.j's
Muammar Qaddafi. Chris is in Rome this morning with the story.
CHRIS WALLACE: Jane, we are just back from Liby 3, where
on Saturday night we spent an hour talking with Colonel Mu9mmar
Qaddafi. In the interview the Colonel said that there was no
justification for a U.S. ban on Libyan oil imports. He al -;o cri -
fiicized Saudi Arabia, saying that it should cut oil production
by two to three mil lion barre I s a day, and that failure to clo so
might destroy OPEC. And we asked him what he will do if U.S.
warships return to the G u l f of S i d r a , , where l a s t summer tw) U.S.
planes shot down two Libyan jets.
COLONEL MUAMMAR QADDAFI: We will defend our cou-atry
till
the last
dro
of our bl
d
d th
l
t
p
oo
an
e
as
man and woman. We
know
we are a small country and America is a superpower. That is
our
duty? We don't want to invade America. We are not going to
make
war on the shores of America. But America is coming acre.
What
we w i l l do on t h i s ? We w i l l do our duty.
WALLACE: And that is to, fight?
COLONEL QADDAFI: Of course. If anyone comes to your
country,-in your home, what do you do in that case? When 'e
attack your home, what you wi I I do?
WALLACE: Qaddafi said throughout the interview hat
he wants good relations with the U.S. But he accused Pres:dent
Reagan of usling Libya to distract the American people from U.S.
economic problems.
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OFFICES IN: WASHINGTON D.C. 0 NEW YORK ? LOS ANG-,EL.ES 0 CHICAGO ? DETROIT ? AND O''HER PRINCIPAL CITIES
 STAT Approved For Release 2005/11/28 : CIA-RDP91-00901 R000400120001-3
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 U pp it
a lin pA J~ 7 romed For ReIe~ S l
CIA-RDP91 00901 R000400120001-3
Interview With CIA Director William J. Casey
eReaS
Threat in EI Sava
And Devon
In a rare and unusually candid discussion,
the nation's intelligence chief spells out
a Kremlin strategy for conquest by subversion
and for building Russian military power
by using secrets stolen from the U.S.
trainees in East Germany and Czechoslovaki_i and 5,000 to
6,000 students in the Soviet Union. They have 50 people
here, 60 people there--in Africa, in the Middle East and in
Latin America.
They can do this because of the demographics that led
them to get rid of 120,000 people in the Nlariel sealift.
There has been a 50 percent jump in the I5-to-19 age
Q Mr. Casey, there's a great deal of concern that this country group in the Cuban population. That's quite a latent force
might be dragged into a Vietnam-like quagmire in El Salvador. In that Castro has no work for at home and ca a use for mis-
your view, Is that fear warranted? chief abroad. He said in a speech just a few months ago that
A No. I don't think El Salvador or what we're likely to do he would like to send 10,000 young Cuban; to Siberia to
there bears any comparison to Vietnam. In the first place, chop down trees for construction projects in Cuba.
Ill Salvador is on our doorstep. And we're not just talking Q Do you have evidence that materiel is being supplied by
about El Salvador; we're talking about Central America-- Cuba to the guerrillas in El Salvador on a significant scale?
Costa Rica, Honduras and Guatemala. The insurgency is A Oh, yes. Without it the guerrillas wouliin t be able to
beamed at all those countries. Furthermore, this is part: of a sustain an insurgency.
worldwide problem. Cl. And Nicaragua? What part does it play?
Q Worldwide In what sense? A This whole El Salvador insurgency is run )ut of Managua
A Around the middle of the 70s, the Soviets assessed the by professionals experienced in directing ;uerrilla wars.
impact of Vietnam on American public opinion and decided You've got to appreciate that Managua has become an inter-
we probably would be restricted in our ability to respond to national center. There are Cubans, Soviets, Fulgarians, East
low-level insurgency operations. In the last seven years, Germans, North Koreans, North Vietname~.e, representa-
starting with the dispatch of sophisticated weapons to join tives of the PLO. North Koreans are giving some weapons
up with Cuban troops in Angola, they have developed a very they manufacture. The PLO provides we ipons they've
innovative and brilliant mix of tactics: Political, diplomatic, picked up around their part of the world. Ther _- are American
destabilization, subversion, terrorists and support of incur- weapons that the Vietnamese brought in in substantial quan-
gencies. And they have applied this around the world. tities-mostly small arms that were left behi' id in Vietnam.
Over this past year alone, you've had insurgencies in Q How large are these foreign groups operating in Managua?
North Yemen, Chad, Morocco, Kampuchea, El Salvador, A In the case of the Cubans, 6,000 are in he country, of
Guatemala. You have incipient insurgencies in many Afri- whom 4,000 are in civil work and maybe 1,8)0 or 2,000 are
can countries. The Soviets work in some concert with Cuba, in military and security work. The East Germans and Soviets
Libya and North Korea. They work with Angola against each have somewhere between 50 and 100. ""he Bulgarians,
Namibia and Zaire; with Ethiopia against Somalia, and with, the North Koreans and the Vietnamese are ewer. They all
Libya and Ethiopia against the Sudan. have their little function: The East Germans vo.rk on the se-
Q How are the Soviets involved? curity system; Cubans work on the general strategy, and the
A What happens in these insurgencies is that the Soviets Soviets work, for the most part, on the larg" weapons that
go in and exploit the underlying social and economic dis- have come in. The North Koreans and Vietnamese are good
contents, which are plentiful. That gives them a base. They at caching arms and digging tunnels and things like that.
feed it with trained men and with arms. That drives away Q Why is the administration apparently so concerned about
investment. The insurgents sabotage economic targets, and the arrival in Cuba of crates presumably containing a squadron
so economic discontent grows. And as the discontent grows, of MiG-23s-a plane that already is operating there?
more people go over to the insurgents' side. A Well, Cuba has the biggest air force in ' he hemisphere
It's almost a no-lose proposition for the Soviets. They can next to ours. The new planes are just part of a buildup. But
stay in the background. They sell their arms and get up to I don't know that we are that concerned. Jimmy Carter
20 percent of their hard currency from Libya and other made it an issue when MiG-23s arrived in Havana, and he
countries that can pay for the arms. It's something we have didn't do anything about it. I think this President has been
very great difficulty coping, with. rather careful not to make it an issue-although I wouldn't
Q What is Cuba's role in all this? say we're. unconcerned.
A Here's a country of 10 million, with 50,000 people Q Does what is happening now in Cuba ,iolate the 1962
around the world-military and civilian. Besides the Cuban Kennedy-Khrushchev agreement ending the missile crisis?
troops in Angola and Ethiopia there ? r 12,000 technical A Oh, sure it does because the '62 agreement said the
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 Soviets would *p 0MveWFF:irH fe8tW,2G0b141PN`a' IA-bP9 a-pd E~ [~~$~ 9" f~}} WWppppr rt of the El Salvador
there would be no export of revolution from Cuba. The insurgents several moiitFis ago, I2 La`Ein American countries
agreement has been violated for 20 years. dissented. That shows growing concern. At the OAS meet-
Q So the aircraft coming to Cuba now are attack planes' -- ing in St. Lucia a couple of months ago, there was a 22-to-3
A They're attack airplanes, yes. vote in support of orderly elections in El Salvador. The three
0. Are they nuclear capable? dissenters were Nicaragua, Mexico and Grenada. just two or
A They can be made nuclear capable. There's an export three weeks ago, Costa Rica, El Salvador and Honduras got 1
version which is not nuclear capable. We haven't seen together and called upon Venezuela., Colombia and the
these planes yet. They're not out of the crate. The probabil- United States to help protect them against Nicaragua.
ity is they're the export version, but it just takes a little bit: Increasingly, the Colombians and the Venezuelans are
of wiring and a little bit.of work and.some pilot training to getting concerned. The Mexicans should be concerned be-
make them nuclear capable. cause they could be the next target. I i ead now that they've
On the other hand, the Soviets have better ways to hit us got at least the beginnings of a qui:-k-reaction force. So
with nuclear bombs. It's more likely these planes are for the maybe they're coming around. Also, 'here is dissidence in
purpose of building Cuba up militarily, modernizing their Nicaragua. A lot of Nicaraguans think that the Sandinistas
Army, probably paying them for their work in Africa--to are betraying the revolution. They resent having the coun-
keep their forces in Angola and Ethiopia. Their Army prob- try taken over and run by Cubans.
ably feels happy if it gets modern equipment, and they So we can hope that development; in Central America
probably wangled these planes out of the Soviets. will breed a reaction. You say "Halt" t' all this when you're
CL Could these MiGs be destined ultimately for Nicaragua? not saying it alone, when you're not p,irceived to be behav-
A We think that Nicaragua is lengthening its runways at ing in Central America the way the Soviets behave in
three airports for the purpose of being able to take this kind Poland and when you have enough Latin American partici-
of fighter. It probably hasn't been determined whether the pation so' that you're helping them instead of doing the
Salvadoran soldiers. "The notion that all massacres of civilians
are perpetrated by the government, not by guerrillas, is false."
planes will go from Cuba to Nicaragua or whether addition-
al planes will go directly from the Soviet Union.
Q Is there a point at which the United States says to the
Soviet Union and Cuba, "This far and no further"?
A-That's the $64 question. I don't think the American
public generally perceives the threat in as serious a light as
we may perceive it at this stage. I think we'll come to our
senses and face up to it. But you've got a problem not only of
American public opinion but of Latin American public opin-
ion. It's the gringo problem: They don't want us down there.
When we go down there, we play into the hands of the
Marxists to a degree; we give them a rallying point. The
President has made it clear that there is no intention of
sending troops there. Exactly what to do to help these
countries defend themselves is a very difficult, complex
political, diplomatic, military decision: You can't make it
without public understanding and public support.
Q Is there any sign that Latin American opinion is changing
and becoming more supportive of the United States? - ~-~
A A year ago no Latin American country was greatly con-
cerned about what was happening in El Salvador. Yet when
whole thing for them.
Q Concretely, what threat do these developments in Central
America pose for the U.S.?
A Well, just look at what is happenir.g down there. Nicara-
gua, a country of 21/x million people, 1-as an Army twice the
size of El Salvador's, which has twice the population and is
fighting for its life. Nicaragua is sitting there with a big Army
that's getting bigger, with Soviet tanks and airfields being ex-
tended and pilots being prepared tor Soviet supersonic
planes. When and if that happens-I think it will happen in
six months-Nicaragua will have mil tary dominance over
the rest of Central America, with a population 7 times theirs.
If Cuba, with 10 million people, an.l Nicaragua, with 2'
million people, take over the rest of Central America and
build up the armies on the scale of ? heir own, you would
have a very large army down there or. our doorstep. Mexico
is sitting there with a military force of about 150,000 today
and never thought of having anything more.
Q Are the persistent reports true that government troops are
responsible for most of the massacres of civilians in El Salvador?
. A Nobody knows where all these casualties come from.
This is civil war. Sometimes they come from the govern-
ment, and sometimes they come from the guerrillas. We are
satisfied that the government is sensitive to the importance
of disciplining its forces and is making a genuine effort to do
so. But that's going to be very slow and not entirely satisfac-
tory to our public opinion. El Salvador has a violent society.
and the law is kind of slow. A man can t be convicted of mur-
der without a witness under their law. And those who sit in
judgment risk their lives because the society is violent. So
judges have a tendency to duck the rponsibility.
But the widely propagated notion that all the massacres
of civilians are perpetrated by the government and not by
the guerrillas is clearly false. In the fl nal analysis, you have
to makeup your mind whether you would prefer a Marxist-
Leninist dictatorship to a society that is capable of reform.
Q Turning to Russia: The CIA and the Defense Department
recently stressed the need to limit Soviet access to American
scientific and technological research. Why the sudden concern?
A You need to be concerned about it. We have estab-
lished a technology-transfer center at the CIA that has
taken a very comprehensive look at the whole question of
the degree to which American research and develop-
ment-and Western technology generally--has contribut-
ed. to the increased accuracy, sophistication, precision,
? ,power and countermeasure capability of the Soviet arsenal.
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 Approved For Release 2b0/1-1721 : CIGAR '%""64f 0N*01Y1_0? `' to gain access to
Key Points Made by Casey
M El Salvador as another Vietnam. El Salvador bears
no comparison to Vietnam. It "is on our doorstep
[and] is part of a worldwide problem."
^ 1962 Kennedy-Khrushchev agreement. The ac-
cord barring Soviet offensive weapons from Cuba and
prohibiting Castro from exporting revolution "has
been violated for 20 years."
e Havana's role in El Salvador. Without arms from
Cuba "the guerrillas wouldn't be able to sustain an
insurgency."
^ Threat from Nicaragua. "Managua has become an
international center" for subversion-harboring 6,000
Cubans, plus Russians, East Germans, Bulgarians, Viet-
namese, North Koreans, PLO. Three airports are be-
ing developed to take advanced Soviet warplanes.
e Qadhafi--a madman? "You could say that." He
was driven to retaliate with assassination squads for
the U.S. downing of two Libyan planes.
a Continued threat to Reagan. Qadhafi's hit teams
still pose a danger to the President. "You don't call
those things off."
^ Russia's reliance on U.S. technology. "Soviet stra-
tegic advances depend on Western technology to a
far greater degree than anybody ever dreamed of,"
and the KGB has a large organization working exclu-
sively to get these secrets.
^ CIA mandate. To overcome the effects of years of
rundown, the agency has a "general go-ahead to carry
out a buildup ... in line with the defense buildup."
We have determined that the Soviet strategic advances
depend on Western technology to a far greater degree than
anybody ever dreamed of. It just doesn't make any sense
for us to spend additional billions of dollars to protect
ourselves against the capabilities that the Soviets have de-
veloped largely by virtue of having pretty much of a free
ride on our R&D. They use every method you can imag-
ine-purchase, legal and illegal; theft; bribery; espionage;
scientific exchange; study of trade press, and invoking the
Freedom of Information Act--to get to this information.
We found that scientific exchange is a big hole. We send
scholars or young people to the Soviet Union to study
Pushkin poetry; they send a 45-year-old man out of their
KGB or defense establishment to exactly the schools and
the professors who are working on sensitive technologies.
The KGB has developed a large, independent, special-
ized organization which does nothing but work on getting
access to Western science and technology. They've been
recruiting about 100 young scientists and engineers a year
for the last 15 years. They roam the world looking for
technology to pick up. Back in Moscow there are 400 or 500
assessing what they need and where they might get it-
doing their targeting and then assessing what they get. It's
a very sophisticated and far-flung operation.
Q Can you give examples of how U.S. research has directly
contributed to the development of Soviet military capabilities?
A Yes. The Soviet ability to MIRV their weapons--to de-
velop multiple, independently targetable warheads for their
missiles and to achieve the accuracy of their missiles that
threaten the survivability of our fixed-site land-based sys-
tems came largely from their hooking on to the technology
behind our guidance systems and from the use of high-preci-
sion grinding equipment they were able to get from us. I'm
not saying they might not have made these advances some-
time anyway. But they got them on the cheap and quick.
A This is something which needs to be looked at across
the board in terms of our export controls in terms of the
openness of information and in terms )f scientific ex-
changes. I think there probably will be a panel of the
National Academy of Sciences that will loo.. carefully at the
question of scientific exchanges and detert'iine how far one
might go to control damaging leakage. But ou're not going
to shut these down. We want to preserve an open society.
We're not going to alter that. But, at the sL: use time, we are
entitled to protect our scientific and techn ,logical secrets.
Q Early in the Reagan administration there was much talk of
Soviet Involvement in international terrorism. Is there evidence
that Russia orchestrates the activities of these terrorist groups?
A We believe they export them more .ban orchestrate
them. Terrorism has become a great indus; ry. It was always
a false issue whether the Soviets directed, and controlled
world terrorism. World terrorism is made ip of a bunch of
freebooters, and they're all, more or less in business for
themselves. The Soviets have supplied sveaaons and trained
the Palestinians and other terrorist groups. ?'hey have train-
ing camps in South Yemen. That was part o! their getting in-
fluence and edging their way into the Mid Ile East.
But if anybody orchestrates them, it's Libya's Qadhafi.
He has made many of them dependent o i him-. After the
'73 war, when the Arab world was in disarc-av, Qadhafi was
looking for leadership. The only thing he had was money-
and nothing to spend it on. So he found all :here Palestinian
organizations wanting to stir things up, a id he started to
put money in them. And then he started t,) train them and
so on. There are over 25 terrorist and ?'uerrilla training
camps in Libya. Training guerrillas and terrorists is the
second largest industry there--second onl to oil.
When Qadhafi wants to send hit teams o t to get his own
dissidents or to retaliate for the downir g of two of his
planes in the Gulf of Sidra by the United States, he uses
mostly Libyans, but he'll also go to Pales. iuian and other
terrorist organizations and sign them up tc help.
The capitals of terrorism are Tripoli and Beirut. The
money comes out of Tripoli, and the infrastructure and the
false documents-the headquarters-are in Beirut. It's a big
business today. They need money, and Qadhafi provides it.
Q What is Qadhafi's aim?
A He's striving for ego satisfaction. He '.ants to be a big
figure in the world. He wants leadership.
Q Is he a madman?
A You could say that. When he's confr rated, he has to
retaliate. He has that kind of ego drive- He has to show that
he's as big as anybody else, and if the United States knocks
two of his planes out of the air, he's got o do something
about it. He talks about it, and then he s under greater
pressure to do something about it. He wa its to spread his
influence across Africa, and his money reaches Muslim
groups as far away as the Philippines.
Q It's your view that the hit squads we heard so much about
were sent by Qadhafi to assassinate U.S. leaders in retaliation
for the downing of the two Libyan planes--
A [ think that's when it started. Of court e, we had previ-
ously, broken diplomatic relations and taken other steps
against Libya. Qadhafi is a little guy fe, -ling he's being
kicked around by the big guy, and he t' pinks he's really
bigger-and he's going to show it.
Q Do those hit teams still pose a danger to the president?
A [ think they do. You don't call those things off. Qadhafi
sent somebody to say, "We're going to cal them off." And
then he said he was firing people out of his i.itelligence orga-
nization, but we find they're still there. We keep getting re-
ports that people are being recruited, mo-;ing around. It's
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 interesting that thg0ri~q~~ar~~g1~/r}~
attache in Paris-who was killed at his home was at tic h.g -
est level below those provided with security. I think that so
much security was laid on to protect the President and other
top Americans that the Libyans may have pulled back for a
while. B t you don't know when they'i e going to resume.
Our Paris embassy believes that a large number of their
personnel are under surveillance. We see people casing the
homes of ambassadors in other countries. There's clearly still
a threat, and you've got to be concerned with it.
Q Does the rescue of Brig. Gen. James L.?Dozier from Italy's
Red Brigades imply that the terrorist threat is receding?
A Oh, no. It's growing. I think we're justseeing the begin-
ning of it.
Take the Red Brigades. People who take up that activity
are not normal, and their egos are easily bruised. When they
suffer a setback, they want to tome back to regain their repu-
tation and status-They bungled the Dozier affair from their
point of view, so their reputation recedes. Like any other
business, when their reputation recedes, their ability to re-
cruit and to get money diminishes. If they want to stay in busi-
ness, they've got to do something again. They've got to score
a hit. They do this to make an impression or to get attention.
The reason I say it's going to increase is that the opportuni-
ty to inflict real damage and to really influence public opin-
ion hasn't been scratched yet. The opportunities to score
propagandistic hits are so much greater. than has been ex-
ploited. That's why I think we're going to have more terror-
ism.before we get less of it.
Q If you were to name the half-dozen most dangerous spots in
the world for the U.S. in the coming period, what would they be?
A Iran, Central,Arnerica, the Middle East, the other side of
the Persian Gulf, Germany and East.Europe, Morocco and
the Strait of Gibraltar.
Q Do you mean East Germany--or West Ger-
many and Eastern Europe?
C~4 Vf5 `-1 O'Kb0~`~kb"Ot'~' 6bdi something could
Then, too, I think, you've got to look as southern Africa.
There's the danger of that area being cut :ff and ultimately
falling into the Soviet sphere of influence That could put
squeeze on the minerals and other reso irces that are so
important to the West. That may not be an imminent
threat, but it's something you have to W01 Ty. about.
But let nie emphasize this: We're not t a only people at
risk. The Soviets have their problems, too
Q What sorts of problems are most serious for the Soviets?
A I would make three points:
First, the Soviets have been able to carry on the biggest
military buildup in the history of the world and somehow
manage to make us the warmonger. we're portrayed as
the threat to peace because we're respoaciur If we tell our
story right, we can turn that tide. We're not very good at it,
but we can make the world more concerned about the
Soviets as a threat to the peace.
Second, the Poland development should be proof of the
failure of the command economy and th?. Commimist sys-
tem. They can't work in the long run without brutal repres-
sion. I don't know how Poland and Rorn..aia, which is also
in a mess, are going to pull out.
Finally, the Soviet economy is in very bad shape. The lead-
ership was a year late with its five-year plan. And in order to
increase military spending. they had to make an enormous
reduction in their investment program. 1 he poor economy
has led to a social malaise, alcoholism, labor unrest and strikes
in the Baltic states. I'm told that Solidarity buttons were
bringing $20 apiece in the Ukraine before December 13.
At some point, the bottom of the barrel is going to
emerge in the Soviet Union. There are real constraints on
the Soviets-real constraints. They're only able to carry on
their activities around the world because they've learned to
use other people so well.
. -n1cr ayriA Big Buildull for the VAL.,
y'E.~c="5;y
Ak.The Cart
Q What have you done to strengthen the agency after Its
these for abou
years of buffeting?
undertook inc
A- The basic intelligence-gathering capability can't be
can be impor
changed=overnight.. It had run down .over a< seven or
and they're u
eight-year period largely because of a 40 percent draw-
er administration did virtually discontinue
t two years, but in the final two years they -
reasing numbers of special activities. These
tant. We don't talk about these activities,
ndertaken only if they're authorized by the-
, -.
down .in: funds and a 50 percent`drawdown in, people. executive branch and reported to Congrfess. , -.
Over the past two years, starting with the last year of,the
Carter3'-administration,. there has; been aim ? increase ,in
C.:_Aree you seriously hampered by legisla "Now let me tell you I come down on
He declined to?prov:de detail, hm- the side of, in such. an r~sessmer,t in
aver, saying it would ;ecr mime intelli- Central America that the outcome of
Bence sources. Later, i o^ r, iof Lhe Situation there Is in-the vital interest -
J3arry Goldwater, Republican of -Arl-
zgna, chairman of the Intelligence Coma- , of, the American people a n:1 must be so
" said
mittee, said that on Feb. 25 William J. ti altsvith, Ptir.Ila-a- . . .11
Casey, Director of Central Intelligence,
and others briefed- his committee and
"left no doubt that there Is active in-
volvement by Sandinista Government
officials in support of the Salvadoran
guerrilla movement." - -
"This support," he stfd,"includes ar-
rangements for the use of Nicaraguan
territory for the movement of arms rind
munitions to ,guerrillas in El Salvador,
the continuing passage of guerrillas in
and ? out of Nicaragua for advanced
training in sabotage and other terrorist
tactics and the preesence of high-level
guerrilla readquarte is elements in
the American people and, as I said re-
cently, I know the American people will
support what is prudent and necessary,
providing they think we mean what we
mean and that we are goir:g to succeed
and not flounder as we did in Vietnam,"
hesaid. - .
Nicaragua.
Mr
Casey
In this 'cep's Issue o? U.S
.
,
.
is red, by which he meant after the situa- I' Neves & World Retort, is reported to
tion in Poland improved. . . ! have said that the ir.surge nts were being
JJ'I't:e United States will not do bust- directed from .Nicaragua with the help
ness as usual with either Poland or the- of Cuba, Vietnam, the Palestine Libera-
Soviet Union "while repression in Pa. tlcn OrganIzalto n and the Soviet Union. ;
land continues," and further sanctions' ~ The magazine quoted Mr. Casey as
will be undertaken if the Polish situation 1. saying that "this whole El Salvador In-
did not improve: surgency is rem out of Managua by pro-
4essimals experienced In directing
guerrilla wars."
Mr._ Haig, went to some lengths to
rebut the argument that El Salvador
Approved For Rel
"I mu been done to sug-
gest there are strong parallels between
CLAIMS PROOF
 Approved For Release 2005/11/28 : CIA-RDP91-00901R000400120
071, ?Ae3
P HILADEL,PHIA INCUIRER
3 MARCH 1932
asytieorgeueuaa dor; the continuing' passage of guer-
n. ca=ta Preas
Haig replied
"I d >n?t know of an
i
i
d
,
y
r
ltas
n an
nut ofNicaragua for
. . - WASHINGTON -.Secretary of State advanced training in sabotage and official in the execs tive branch who
Alexander M. Haig Jr. said yesterday other terrorist tactics, and the pres- is considering that c~otion." At anoth-
that the military operations' of the ence_ of high-Ievel :guerrilla head- ! er point, he said the administration's
Salvadoran guerrilla movement were quarters elements in Nicara4ua," policy would be guided by "what is
being directed from outside the Coldwatersaid. most prudent and w~iat is most likely
country by non-Salvadoran forces he Casey was quoted in this week's to succeed".
refused to identify. issue of U.S. News & World Report as Haig was testifyin on the aclriints-.
Haig told the House Foreign Affairs saying that the insurgency in El Sal- tration's request fo S8.67 billion in
Committee that he could not provide vador was being directed from Nica- foreign military an( security related
more details because this'could jeop- ragua with the help of Cuba, Viet aid.
ardize U.S. intelligence Isources. narn, the Palestine Liberation Organ- On another issue Ilaig sought"to
Haig's statement- emphasized the' ization (PLO) and the Soviet Union. dodge questions abut whether the
Reagan administration's' contention` Guillermo Ungo, a leader. of the. administration plans to sell mobile
that the turmoil in Ef-Salvador does' Salvadoran leftist groups seeking to Hawk antiaircraft missiles and ad-
not result exclusively from local overthrow the ruling junta, has de vanced jet fighters to Jordan. Al-
discontent. Some critics of adminis? nied that the civil war is being di- though the idea has triggered fierce
tration policy'have challenged that rected from outside EI Salvador ' by opposition from Israel. Defense Sec-
retary Caspar W. recent
contention, nonSalvadorans. 1 discussed the
"[ he operations of the guerrilla are directing the war are in El Salva- y pns'?ibdity with Jot
forces inside EI Salvador are con- dor," Ungo, president of the Demo dan's King IIussein, ;:ad the king said
trolled from external command and cratic Revolutionary Front,. said in in a television interview Sunday that
control," Haig said in' response to a an interview Monday with the Also- he intended to ask tae United States!
In to sell him the equipment,
i dated Press.
question from Rep. Lee Hamilton (D., a
d.). Ile added that congressional In his testimony yesterday, Haig Haig ' avoiding confrontation
.lntclligence committees recently had again warned that it was a "terrible with Israel's congre signal support-
been briefed privately on the sub- distortion" to draw parallels between ers, replied with the :dministration's
jec t:: El Salvador and the Vietnam War. He stock answer that io request had
Sen. Barry Goldwater .(R., Ariz.) said the Caribbean Basin is far more been received from Jordan and thus
chairman of the Senate Intelligence critical to American security inter- no decisions have )een made.'He
Committee, said that on: Feb. 25, CIA gists because a sizable portion of U.S. added: "It is not prt dent to get out
Director William Casey and: others oil and trade passes through, that front with definitive statements that
had given the panel a briefing that, reason` are neither timely nor called for"
"left no doubt that there