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THE CENTRAL INTELLIGENCE GROUP AND THE CENTRAL INTELLIGENCE AGENCY, 1946–1952
The years 1946 to 1952 were the most crucial in determining the functions of the central intelligence organization. The period marked a dramatic transformation in the mission, size, and structure of the new agency. In 1946 the Central Intelligence Group (CIG), the CIA's predecessor, was conceived and established as a coordinating body to minimize the duplicative efforts of the departmental intelligence components and to provide objective intelligence analysis to senior policymakers. By 1952 the Central Intelligence Agency was engaged in clandestine collection, independent intelligence production, and covert operations. The CIG was an extension of the Departments; its personnel and budget were allocated from State, War and Navy. By 1952 the CIA had developed into an independent government agency commanding manpower and budget far exceeding anything originally imagined.
I. The OSS Precedent
The concept of a peacetime central intelligence agency had its origins in World War II with the Office of Strategic Services (OSS). Through the driving initiative and single-minded determination of William J. Donovan, sponsor and first director of OSS, the organization became the United States' first independent intelligence body and provided the organizational precedent for the Central Intelligence Agency. In large part, CIA's functions, structure, and expertise were drawn from OSS.
A prominent attorney and World War I hero, "Wild Bill" Donovan had traveled extensively in Europe and had participated in numerous diplomatic missions for the government after the war. A tour of Europe for President Roosevelt in 1940 convinced him of the necessity for a centralized intelligence organization. Donovan's ideas about the purposes an intelligence agency should serve had been shaped by his knowledge of and contact with the British intelligence services, which encompassed espionage, intelligence analysis, and subversive operations—albeit in separately administered units. The plan which Donovan advocated in 1940 envisioned intelligence collection and analysis, espionage, sabotage, and propaganda in a single organization. Essentially, this remained the basic formulation for the central intelligence organization for the next thirty years.
The immediacy of the war in Europe gave force to Donovan's proposal for a central agency, the principal purpose of which was to provide the President with integrated national intelligence. Acting on Donovan's advice, Franklin Roosevelt established the Office of Coordinator of Informtion (COI) in the summer of 1941. COI with Donovan as Coordinator, reported directly to the President. Its specific duties were to collect and analyze information for senior officials, drawing on information from the Army, Navy, and State Departments when appropriate. A year after its creation, when the United States was embroiled in war with Germany and Japan, the Office was renamed the Office of Strategic Services (OSS) and placed under the direction of the Joint Chiefs of Staff.
The British provided invaluable assistance to OSS. British experts served as instructors to their American counterparts in communications, counterespionage, subversive propaganda, and special operations. In real terms the British provided American intelligence with the essence of its "tradecraft"—the techniques required to carry out intelligence activities.
OSS was divided into several branches. The Research and Analysis (R&A) branch provided economic, social, and political analyses, sifting information from foreign newspapers and international business and labor publications. The Secret Intelligence (SI) branch engaged in clandestine collection from within enemy and neutral territory. The Special Operations (SO) branch conducted sabotage and worked with resistance forces. The Counterespionage (X–2) branch engaged in protecting U.S. and Allied intelligence operations from enemy penetrations. The Morale Operations (MO) branch was responsible for covert or "black" propaganda. Operational Groups (OG) conducted guerrilla operations in enemy territory. Finally, the Maritime Unit (MU) carried out maritime sabotage.
Although by the end of the war OSS had expanded dramatically, the organization encountered considerable resistance to the execution of its mission. From the outset the military were reluctant to provide OSS with information for its research and analysis role and restricted its operations. General Douglas MacArthur excluded OSS from China and the Pacific theater (although OSS did operate in Southeast Asia). In addition to demanding that OSS be specifically prohibited from conducting domestic espionage, FBI Director J. Edgar Hoover and Nelson Rockefeller, then Coordinator of Inter-American Affairs, insisted on maintaining their jurisdiction over Latin America, thereby excluding OSS from that area.
These operational limitations were indicative of the obstacles which OSS encountered as a new organization in the entrenched Washington bureaucracy. On the intelligence side, OSS failed to establish a consistent channel of input. Roosevelt relied on informal conversations and a retinue of personal aides in his decisions. The orderly procedure of reviewing, evaluating, and acting on the basis of intelligence was simply not part of his routine. Roosevelt's erratic process of decisionmaking and the Departments' continued reliance on their own sources of information frustrated Donovan's hope that OSS would become the major resource for other agencies.
Nonetheless, General Donovan was firm in his conviction that a centralized intelligence organization was an essential element for senior policymakers. Anticipating the end of the war, Donovan recommended the continuance of all OSS functions in a peacetime agency directly responsible to the President. Having endured the difficulties surrounding the establishment of OSS, Donovan had by 1944 accepted the fact that a separate, independent intelligence agency would have to coexist with the intelligence services of the other Departments. In a November 1944 memorandum to Roosevelt in which he recommended the maintenance of a peacetime intelligence organization Donovan stated:
You will note that coordination and centralization are placed at the policy level but operational intelligence (that pertaining primarily to Department action) remains within the existing agencies concerned. The creation of a central authority thus would not conflict with or limit necessary intelligence functions within the Army, Navy, Department of State, and other agencies.
Donovan's hope that OSS would continue uninterrupted did not materialize. President Harry S Truman ordered the disbandment of OSS as of October 1, 1945, at the same time maintaining and transferring several OSS branches to other departments. The Research and Analysis Branch was relocated in the State Department, and the Secret Intelligence and Counterespionage Branches were transferred to the War Department, where they formed the Strategic Services Unit (SSU). Although it is impossible to determine conclusively, there is no evidence that OSS subversion and sabotage operations continued after the war. SSU and the former R&A Branch did continue their activities under the direction of their respective departments.
The OSS wartime experience foreshadowed many of CIA's problems. Both OSS and CIA encountered resistance to the execution of their mission from other government departments; both experienced the difficulty of having their intelligence "heard"; and both were characterized by the dominance of their clandestine operational components.
II. The Origins of the Central Intelligence Group
As the war ended, new patterns of decisionmaking emerged within the United States Government. In the transition from war to peace, policymakers were redefining their organizational and informational needs. A new President influenced the manner and substance of the decisions. Unlike Franklin Roosevelt, whose conduct of foreign policy was informal and personalized, Harry Truman preferred regular meetings of his full cabinet. Senior officials in the State, War, and Navy Departments were more consistent participants in presidential decisions than they had been under Roosevelt. In part this was a result of Truman's recognition of his lack of experience in foreign policy and his reliance on others for advice. Nonetheless, Truman's forthright decisiveness made him a strong leader and gained him the immediate respect of those who worked with him.
Secretary of State James F. Byrnes had little diplomatic experience, although he had an extensive background in domestic politics, having served in the House and Senate and on the Supreme Court. Secretary of War Robert P. Patterson, a lawyer by training, had been immersed in the problems of war supply and production. In 1945 he faced the issue of demobilization and its implications for the U.S. postwar position. Secretary of the Navy James V. Forrestal was probably the individual with the most fully developed ideas on foreign policy in the cabinet. As early as May 1945 he had expressed concern over the potential threat of the Soviet Union and for the next two years he continued to be in the vanguard of U.S. officials who perceived the U.S.S.R. as the antagonist to the United States.
Among the Secretaries, Forrestal was also a vocal proponent of more effective coordination within the Government. He favored something similar to the British war cabinet system, and along with it a central organization to provide intelligence estimates. In the fall of 1945, Forrestal took several initiatives to sound out departmental preferences for the creation of a central agency. These initiatives were crucial in developing a consensus about the need for centralized intelligence production, if not about the structure of the organization serving the need.
Truman himself shared Forrestal's conviction and supported the Secretary's efforts to review the problem of centralization and reorganization. From October through December 1945, U.S. Government agencies, spurred on by Forrestal, engaged in a series of policy debates about the necessity for and the nature of the future U.S. intelligence capability. Three major factors dominated the discussion. First was the issue of postwar defense reorganization. The debate focused around the question of an independent Air Force and the unification of the services under a Department of Defense—whether there should be separate services (the Air Force becoming independent) with a Joint Chiefs of Staff organization and a civilian Secretary of Defense coordinating them, or a single Department of National Defense with one civilian secretary and, more importantly, one chief of staff and one unified general staff. Discussion of a separate central intelligence agency and its structure, authority, and accountability was closely linked to the reorganization issue.
Second, it was clear from the outset that neither separate service departments nor a single Department of National Defense would willingly resign its intelligence function and accompanying personnel and budgetary allotments to a new central agency. If such an agency came into being, it would exist in parallel with military intelligence organizations and with a State Department political intelligence organization. At most, its head would have a coordinating function comparable to that envisioned for a relatively weak Secretary of Defense.
Third, the functions under discussion were intelligence analysis and the dissemination of intelligence. The shadow of the Pearl Harbor disaster dominated policymakers' thinking about the purpose of a central intelligence agency. They saw themselves rectifying the conditions that allowed Pearl Harbor to happen—a fragmented military-based intelligence apparatus, which in current terminology could not distinguish "signals" from "noise," let alone make its assessments available to senior officials.
Within the government in the fall of 1945 numerous studies explored the options for the future defense and intelligence organizations. None advocated giving a central independent group sole responsibility for either collection or analysis. All favored making the central intelligence body responsible to the Departments themselves rather than to the President. Each Department lobbied for an arrangement that would give itself an advantage in intelligence coordination. In particular, Alfred McCormack, Special Assistant to Secretary of State Byrnes, was an aggressive, indeed, belligerent, advocate of State Department dominance in the production of national intelligence. President Truman had encouraged the State Department to take the lead in organizing an intelligence coordination mechanism. However, as McCormack continued to press for the primacy of the State Department, he encountered outright opposition from the military and from Foreign Service stalwarts who objected to the establishment of a separate office for intelligence and research within State.
Among the studies that were underway, the most influential was the Eberstadt Report, directed by Ferdinand Eberstadt, an investment banker and friend of Forrestal. Eberstadt's recommendations were the most comprehensive in advancing an integrated plan for defense reorganization and centralized decisionmaking. In June 1945, Forrestal commissioned Eberstadt to study the proposed merger of the War and Navy Departments. In doing so, Eberstadt examined the entire structure of policymaking at the senior level—undoubtedly with Forrestal's preference for centralization well in mind. Eberstadt concluded that the War and Navy Departments could not be merged. Instead, he proposed a consultative arrangement for the State Department, the Army and the Navy, and an independent Air Force through a National Security Council (NSC).
Eberstadt stated that an essential element in the NSC mechanism was a central intelligence agency to supply "authoritative information on conditions and developments in the outside world." Without such an agency, Eberstadt maintained, the NSC "could not fulfill its role" nor could the military services "perform their duty to the nation." Despite the fact that the Eberstadt Report represented the most affirmative formal statement of the need for intelligence analysis, it did not make the giant leap and recommend centralization of the departmental intelligence functions. In a section drafted by Rear Admiral Sidney Souers, Deputy Chief of Naval Intelligence, and soon to become the first director of the central intelligence body, the report stated that each Department had its independent needs which required the maintenance of independent capabilities. The report recommended only a coordination role for the agency in the synthesis of departmental intelligence.
The Presidential Directive establishing the Central Intelligence Group reflected these preferences. The Departments retained autonomy over their intelligence services, and the CIG's budget and staff were to be drawn from the separate agencies. Issued on January 22, 1946, the Directive provided the CIG with a Director of Central Intelligence (DCI), chosen by the President. The CIG was responsible for coordination, planning, evaluation, and dissemination of intelligence. It also was granted overt collection responsibility. The National Intelligence Authority (NIA), a group comprised of the Secretary of State, the Secretary of War, the Secretary of the Navy, and the personal representative of the President, served as the Director's supervisory body. The Intelligence Advisory Board (IAB), which included the heads of the military and civilian intelligence agencies, was an advisory group for the Director.
Through budget, personnel, and oversight, the Departments had assured themselves control over the Central Intelligence Group. CIG was a creature of departments that were determined to maintain independent capabilities as well as their direct advisory relationship to the President. In January 1946, they succeeded in doing both; by retaining autonomy over their intelligence operations, they established the strong institutional claims that would persist for the lifetime of the Central Intelligence Agency.
III. The Directors of Central Intelligence, 1946–1952
At a time when the new agency was developing its mission, the role of its senior official was crucial. The Director of Central Intelligence was largely responsible for representing the agency's interests to the Department and for pressing its jurisdictional claims. From 1946 to 1952, the strength of the agency relative to the Departments was dependent on the stature that the DCI commanded as an individual. The four DCIs during this period ranged from providing only weak leadership to firmly solidifying the new organization in the Washington bureaucracy. Three of the four men were career military officers. Their appointments were indicative of the degree of control the military services managed to to retain over the agency and the acceptance of the services' primary role in the intelligence process.
Excerpted from The Central Intelligence Agency by William M. Leary. Copyright © 1984 The University of Alabama Press. Excerpted by permission of The University of Alabama Press.
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