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The CIA: How It Is Organized

Chapter 11

The Dulles Era Begins

          The old, pastel yellow brick east building on a hill overlooking Foggy Bottom, on what is now the site of the Kennedy Center for the Performing Arts and the Watergate Buildings, was just the place for the scent of pipe tobacco and the quiet shuffle of worn leather slippers. The high-backed chair and elongated office were also right for its new tenant. Allen Dulles moved into a place that already seemed to bear his trademarks and characteristics. Unpretentious as the East Building was, it seemed right for a daily stream of jet-black, chauffeur-driven limousines to pull up the hill, over the winding narrow driveway, and then down into the garden circle where no more than three or four cars could stop at any one time. Typically, the VIP cars pulled over onto the grass to permit the little old bottle-green buses to shuttle from one hidden CIA building to another. All these buses seemed at some part of their wanderings to find their way past the home of Mr. Dulles, as though anyone who worked for him should be kept aware of the fact that he was sequestered somewhere up there on the dim second floor overlooking the Potomac.

          The Agency had a good chance of being secret without making much effort. Either by design or by a hand-me-down procedure, the CIA inherited the most motley group of buildings imaginable. Someone in the General Services Administration with a real sense of humor must have made out the CIA allocation in the Greater Washington area. At the north end of the Fourteenth Street (Rochambeau) Bridge and to the north of the Bureau of Engraving and Printing, where not less than 70 -- 80 percent of all tourists who scramble through Washington each year find their way, there is a red brick building that looks like part of a converted stable. The Agency was in there. Further north on Sixteenth Street, across from the Statler-Hilton Hotel and next door to Washington's own Gaslight Club, is another nondescript building, not too far from the Soviet Embassy. CIA was there. On Connecticut Avenue, in what is now the heart of the business district, there used to be a building that had floors that sagged so much that tenants shuddered each time a big truck went by down below. CIA was in there. CIA was crammed into every one of the fairly well kept, but seriously overcrowded World War II Tempo Buildings along the south side of the Reflecting Pool east of the Lincoln Memorial Across the parkway, near the cherry tree Tidal Basin, in buildings named "Alcott" and "Barton" for their World War II Army WAAC tenants, the CIA was tucked in too. In fact, the CIA was so scattered that there was scarcely a part of Washington that did not have CIA offices hidden away. And of course, it was very simple for anyone who wished to find out where the Agency was to follow the little green buses, which trundled all day long in never-ending circles, some clockwise and some counter-clockwise, from building to building.

          Things like this did not bother Allen Dulles. It is entirely possible that he never found out where all of his agency was anyhow. Such details were not for him. As a matter of fact, one of the first things he did when he became the Director was to abolish the office of the Deputy Director of Administration. In a city renowned for its bureaucratic administration and its penchant chant for proving how right C. Northcote Parkinson was, Mr. Dulles' first act was more heretical to most Washingtonians than one of Walter Beedle Smith's first actions -- the one in which he told the McCarthy hearings that he thought there might well be Communists in the Agency Washington -- was not as upset about the Communists as it was to learn that a major agency of the Government had abolished Administration. Mr. Dulles took the view of the intelligence professional, that it was much more dangerous and therefore undesirable to have all kinds of administrators acquiring more information than they should have, than it was to find some way to get along without the administrators.

          While the public was mulling over that tidbit from the CIA, the real moves were being made inside the organization, where no one could see what was going on. The Deputy Director of Intelligence, strengthened by the addition of the current Intelligence organization and other such tasks, was to be responsible for everything to do with intelligence, and more importantly, was to be encumbered by nothing that had to do with logistics and administration. This was the theory. In practice, the DD/I has a lot of administrative and support matters to contend with as does any other large office. However, as much of the routine and continuing load as could be was set upon the Deputy Director of Support.

          At the same time, the new and growing DD/P (the special operations shop) was similarly stripped of all encumbrances and freed to do the operational work that Dulles saw developing as his task. This left the DD/S (Support) with a major task. He was responsible for the entire support of the Agency, support of all kinds, at all times, and in all places. At the head of this directorate for many, many years has been the most unsung hero of the Agency and perhaps its ablest deputy, L. K. White. He is better known as "Red" White, a former Army colonel and a most able manager and administrator. He has made things work.[1]

          The CIA as an intelligence agency offers no unusual elements on most counts. It is pretty much what it seems to be. Special operations has been exposed one way or another so many times that there is not too much guesswork about its role. But researchers have been unable to work their way into what it really is that makes the Agency what it is today. This distinctive characteristic is its superior logistics support. If an agent working in Greece needs some Soviet-built rifles of a certain vintage to equip some agents for a border or cross-border assignment, all he has to do is get his request to the station chief. He will in turn put it on the Agency line direct to Washington, where DD/S will process it. Within hours, one of their men, posing as an Air Force man in "X" country, will leave his office and drive out with an Air Force pickup truck to a small building on the far side of the base. There he will unlock a wire-anchor fence, then step unto a "go-down" storage tunnel until he comes to a row of heavy boxes. There he will look for a special mark that describes the guns he wants.

          He will drive, with the nondescript box, across the field to another building, where a normal-looking Air Force supply office is located. In what looks like the usual supply room and storage area, he will find a shop filled with special tools and machinery. In short order, he will have the guns unpacked, removed from the heavy coatings of cosmolene and lead foil, and in an hour or so these guns will have been repackaged and labeled "P-84 Wing Tank" or some such cover name. Then an Air Force transport plane on its way to Naples and Athens will take this boxed "Wing Tank" to the Air Force Military Assistance Advisory Group section at the military airfield outside of Athens. There an Air Force MAAG man will take the box and see that it gets to its destination. That same day a small single engine plane will fly low over a remote, mountainous site and gently airdrop that box onto a set of camouflaged panels that mark the site for the trained pilot.

          Nothing is difficult for the DD/S. The above order and action are examples of the routine. What was not routine was the establishment and maintenance of the system that made that possible. Someone had to get those special guns into the hands of the CIA in the first place. Then an elaborate global network of supply and support bases had to be established, not only as functional bases, but also with the double role of looking like one kind of facility and doing the important task of another.

          A closed World War II airfield in England, once the home of an American fighter wing, was found to be an ideal site for DD/S operations. The Navy is "Prime" (the U.S. military department assigned the task of working with the British on all matters pertaining to the support and housing of Americans on the British Isles) in England. The Agency asked the Navy to establish some reason for asking the British to permit the limited reopening of this base. The CIA and the Navy agreed on their cover story and then met with the British, who of course were told the real reason for the request, but also were expected to maintain the cover story.

          With some small show of normalcy, the British reopened the base. The most obvious evidence that the base had been reopened in that country neighborhood was the appearance of British uniformed guards at the gates on a twenty-four-hour basis. The Navy set up a "supply facility". It had a real U.S. Navy base designation. The base commander arrived in uniform, and his staff and enlisted men followed soon after. The base hired local British people, some as secretaries and others to run the kitchen and other facilities. In actual practice, the base had not a single real Navy man. All of those at the base were CIA men carefully accredited to the Navy and sent overseas as naval personnel.

          The base gradually was loaded with "Navy" equipment, and at the proper time it was announced that the Navy was going to maintain some highly classified gear at the base in addition to the regular items and that certain buildings would be off-limits to all unauthorized personnel, British and American. By that time DD/S had a major storage and maintenance site in a most convenient and secure location.

          If anyone knew that this site had been created for more than met the eye, he might note that it was not far from the huge operating base of the U.S. Air Force Air Resupply and Communications Wing that was assigned to England. The Agency site would actually be a satellite base to the huge Air Force operation with which it was linked. It is this formula that has made it possible for the CIA, with the appearance of only a little in the way of support and logistics on its own, actually to command boundless equipment, manpower, and facilities, including aircraft from the ever ready and always eager Air Force sister unit. The law and the directives and the other limits that have been put upon the Agency in an attempt to keep it out of major operations seemed to most observers -- and in this business there were few witting observers -- to be working well; but for the knowledgeable, the Agency was fast becoming, by the mid-fifties, a major peacetime power.

          It was in 1955 that the then new Senator Mansfield, among others, attempted to get a law through the Congress that would establish a strong watchdog committee to oversee the CIA. One of the principal reasons this law did not pass was that such CIA stalwarts as Senator Russell and Senator Saltonstall affirmed that there was no need for such committees. The Congress, in their words, needed no more committees than it had at that time. They went on to say that they were always informed about everything the Agency was doing and that they could see no reason why the whole Congress should be brought in on such things when there was no need whatsoever for such action.

          I have worked closely with Senator Saltonstall, and many others who were on those committees, and except in rare instances, they never knew that the CIA was so huge. They knew how big the CIA was within the bounds of the "real" or intelligence organization; but none of them knew about its tremendous global base capability, and what is much more important, none of them knew the intricacies of the Agency's supporting system that existed in the name of the Army Special Forces and the Air Force Air Supply and Communications Wings. Again there will be some who say, "Oh yes, Senator John Doe visited that base, and he saw this, and he was told that the whole business was highly classified. He said he knew what it was." Such things usually can be said, and such things may have happened; but no one man or no one group of knowledgeable men had ever had the opportunity to see the whole picture. As I have heard Senator Saltonstall say, "Now don't tell me about that classified material. What I don't know about it won't hurt me." That has been a general attitude on Capitol Hill. In discussions I have had with responsible committeemen on the Hill, I have found this to exist as recently as September 1971. This situation has not changed much. There are no Congressmen and no Senators who really know about the Agency and about what the Agency is doing.

          As a result of the war planning role of the CIA, it was easy for the CIA planners to enter in the plans of all armed forces, requirements for wartime equipment, vehicles, aircraft, and facilities that had to be earmarked and stockpiled for use by the Agency in the event of war. Once such requirements were listed in the war plans they could be requisitioned along with all the other war-plan material. This meant that the cost of this equipment would be worked into the military budget, and then in due time each item would be purchased and delivered to the advance base site where war plan material was stockpiled. Warehouse after warehouse of "military equipment" is stored in the Far East, in Europe, and throughout the United States for the eventual use of the CIA. The cost of this material and of its storage, care, and conditioning is inestimable.

          To handle all of this material the Agency has large bases in Europe, Africa, Southeast Asia, Okinawa, Japan, Panama, and the United States. These supplies are kept in good shape, and reconditioned and rotated in stock with those that are used. Thus, whenever a requirement arises, the Agency has what it needs or can get what it needs from other sources.

          Some of the war-plan equipment has a brief shelf-life, which requires that it be exchanged, used, or at least rotated with items in service. The Agency does not have sufficient demand for some of these things to permit it to keep up with such practices, so it has worked out rotation schedules with the services to let them have what it has in storage and then to get new replacement equipment when it is available. Also, the Agency has become a stopgap source of supply when something is needed as for a military assistance project or some other such emergency. As the years passed and as the Agency's "military" role became more a matter of custom and generally accepted, Agency military cover units became so deeply covered that their neighboring military units did not know, or forgot, that the unit near them was not a regular military unit. By that time, requisitions from these CIA units were as readily acceptable as any others and the units became easily self-supporting without any Agency funding input.

          There are so many CIA cover units in the military that no accounting system can keep up with all of them. The military System also permits easy requisitioning between the services. As a result, an Army unit may requisition from a nearby Navy or Air Force unit and vice versa. A Navy CIA cover unit, for example, will requisition from an army or Air Force unit that will never question the right of that unit to draw the supplies it wants, but will simply make out cross-servicing accounting tickets and file them. The service that gave up the material will gather the supply tickets at its supply centers and then, depending upon how sophisticated its accounting system is and upon the instructions it may have received from its CIA Focal Point Office, it will either turn them in for reimbursement or pay them itself and forget about it. At all staff meetings on the subject, the CIA will protest that it pays all bills that are presented for reimbursement by the DOD and other agencies of the Government. This may be true, but the important thing is that few of the other government offices ever sort out all of these cats and dogs to the point where they are able to tally them up and render meaningful statements. As a result, the CIA gets millions of dollars of equipment each year without any attempt to collect on the part of the losing organization.

          After World War II and, more importantly, after the Korean War, the military services had counted millions of dollars worth of surplus equipment in storage. One of the biggest tasks of the military logistics branches was to find some legal way to get rid of this surplus, most of which was new and unused. The laws that governed the disposal of such material required that it be made available first to the other services. Materials not wanted by the other services would then be offered on the basis of a priority list to other government agencies and departments, to state and local governments, colleges and universities, and so on, until any remaining surplus would be put up for public sale or auction.

          The CIA found that it could beat this system easily by setting up certain cover units that appeared to be military units. These cover units would requisition copies of the surplus lists, would go over them carefully, and then would claim the items in the quantities desired and take delivery of them at some service base, where they would be prepared for transshipment to a military facility under CIA control. In this manner, or through variations of this method, the CIA was able to stockpile mountains of equipment.

          Some of the variations on this system were rather subtle. For example: If a country that had certain elements who were working with a U.S. military unit that was really a CIA organization wanted certain items of military equipment not authorized by the mutual aid program or other such assistance plans, it might in the normal course of business ask the men in the unit what they could do to help. The unit would pass this word on to the CIA station chief, who would contact the DD/S staff to see if the equipment desired could be obtained, perhaps through surplus.

          The DD/S would alert one of its cover units, and they would screen the surplus lists to find the items. In most cases, they would find them or they would find that the Army could be persuaded to list the needed number of those items as surplus, as long as they knew that they were going to be cross-requisitioned by the "Air Force", and as long as they had thus been assured that the items would not slip past the surplus lists and reach public sale. Thus the CIA would get what it wanted, free and in the quantity it wanted. They would be delivered to the CIA's own military cover supply depot and from there they would be processed to the overseas unit. All packaging, crating, and shipping would be kept within military channels and would be paid for in most instances by the military, since it would not know that the two units, the gaming one and the shipping one, were both cover units. In due time, the equipment the foreign government wanted would arrive at the "military" unit there, and that government would either have the use of the equipment or would be given the equipment as soon as transfer arrangements could be made.

          It takes a lot of study of these processes and a lot of familiarity with the system to clarify how it works and how these things can happen without an exchange of funds. However, it would be incorrect and unwise to attribute to the CIA the idea that the Agency improperly uses the cover system to acquire valuable equipment without properly paying for it. It would be equally incorrect and unwise to create the idea that the military services do not account properly for the equipment they have on their inventory rosters. In normal cases, the military is quite precise about transfer of property, and there is seldom more than an occasional malfunction in the supply system. Also, the CIA has been scrupulous when it has been possible for it to pay for, by reimbursement, any equipment that the military services have furnished and for which it has been billed. The breakdown comes in the application of secrecy. Few supply people in the huge defense supply organizations know that the CIA has military units, and most of them, if they thought that the CIA was involved with some shipment, would never say a word to anyone about it. Then when the statement drawn upon a cover unit that was unfunded was not paid properly by the transfer of funded sums, the supply agency would simply pay it off from some available account rather than break security. They may be wrong to do this; but they choose this rather than taking a chance on exposing a CIA activity that might be important.

          On the other hand, the CIA will state at the time they requisition items of equipment that they will pay all bills rendered. In some cases, they have put money in what amounts to an escrow account so that the DOD may draw against it. However, again the existence of such funds is usually cloaked in security, and it is seldom that the account is drawn upon. I knew of millions of dollars in such accounts that were never used, and they were lost to both organizations as they returned unclaimed to the general treasury. There is a feeling that "it is all for the Uncle anyhow", so why account for such transactions.

          This may be all very well and may be a suitable reply; but when one reflects that the President and the Congress had taken great precautions to preclude the growth of an operational agency and to do this by prohibiting the Agency from building up just such supplies of equipment, this whole process becomes more important on that score than it does from the point of view of the money involved. The CIA was not supposed to have money, men, materials, or global facilities. The ease with which the Agency got around these restraints was remarkable, and it explains why so few knew at the time it was being done. One of the only tried and tested methods by which any government can control its subordinate organizations is through the purse-strings. When an organization finds ways to get around the restraints of money control and grows from within in a parasitic manner, it becomes very difficult for the usual controls to operate. Add to this the thick screen of security that has kept most of the other normal review authorities from seeing what the Agency was doing, and it is not too surprising to find that neither Congress, the President, nor the American people had realized that by 1955 the ClA had become, right before their eyes, the largest and most active peacetime operational force in the country.

          Some of these actions worked in strange ways. And some of these actions were subject to the same irregularities that plagued the rest of the operations that were kept from the eyes of the public and from the controls normal to an open government. The irresponsible step in from time to time and get away with things that would be discovered in normal activities.

          At one overseas base heavily involved in air activities in support of the Agency and of the foreign nationals the Agency was assisting, there were a number of aircraft of doubtful ownership commingled with other aircraft that were on "loan" from the Air Force. These aircraft were flown and maintained for the most part by a civilian facility that had the appearance of being a civilian contract carrier; but there were also a number of Air Force and Navy personnel with the unit in various capacities. The primary base unit was under Navy cover and had been for years, as a result of an earlier mission. With such a mix of personnel and equipment it was all but impossible, and certainly impractical, to attempt rigid controls in the manner customary on a real military base.

          One of the planes assigned to this unit was a small transport aircraft common to all three services and built by the Beech Aircraft Corporation. This plane was flown by the officers of the staff and was used for shorter administrative flights. One of the pilots who flew it regularly came in to land in a bad crosswind one day and momentarily lost control of the plane after it had touched the ground during landing, in what is called a "ground loop". He recovered in time to keep from doing very much damage and no one was hurt. The plane needed minor repairs to be as good as new. However, this pilot, who also had maintenance authority at this conglomerate base, ordered that the plane be hauled out behind the main hangar and covered with a large protective tarpaulin. It was left there for months, and unknown to others on the base, a report was filed to Washington that it would cost more to fix the plane than it was worth; so the plane was scheduled for what the military calls "salvage". This means it is put up for sale to the highest bidder for scrap, or whatever.

          No one on this base, which was primarily managed by the CIA, gave this a thought, and after a while the plane was not even missed. During this time the pilot, a major who was actually a career CIA employee serving in his Air Force reserve grade, was transferred back to an assignment in Washington at CIA headquarters. He had not been there long when he located the paperwork on that plane and made a bid in his own name and that of a friend to purchase the plane for scrap prices. Since no one else even knew where the plane was (and even if they had they would not have wanted to go to that remote place to get it) and of course, since any other bidder would have believed that the plane was a total loss, there were no other bidders. The major bought the plane in a perfectly legal maneuver.

          He then applied for a brief vacation. Dashing back to the overseas station, where he was well known, he arranged with the local maintenance crews to have the plane fixed at very little expense to himself, and in no time he and his friend shipped it back to the United States. Their profit on the deal was many times more than the actual money they had invested, and no one ever knew about it because all of the records had been kept in highly classified channels. Secrecy can be used for many purposes, and this was just one of the uses to which it can be put by those of the team who know how to get away with it.

          Emboldened by this success, the same man arranged a few years later to be the project officer on a rather large air operation in Antarctica. He and his companions worked up a team that was going to accomplish some very special work on that remote continent. They had two Air Force twin-engined transport aircraft heavily modified and modernized, and then got together millions of dollars' worth of special electronic and photographic equipment. They filled the planes with equipment and still had so much left over that they had to have the Air Force fly it to Panama, where it caught up with the Navys regular shipments on the way to McMurdo Sound. They had this priority-classed equipment put aboard, even at the cost of off-loading some of the Navy's own equipment.

          Everything was brought to Antarctica, where these men established their own base satellited upon the Navy from McMurdo Sound. Whereas most of the Navy's supplies for Antarctica are either ship-borne via the Panama Canal or airborne from Christchurch, New Zealand, this group flew down the coast of South America to Argentina, and then took off from there, with elaborate assistance from the Argentine navy.

          After their project had been completed for the year, they reported that one of the planes could not operate because of some sort of engine trouble, and that since the dangerous trip back with only one plane would be too hazardous, they planned to leave both aircraft and all of their equipment cached in the Antarctic. All personnel were flown out by the Navy and returned to the United States. It just happened by coincidence nearly one year later that a U.S. military officer stationed in Argentina reported the arrival of a civilian who was working with contacts in the Argentine navy to see if arrangements could be made, privately, to bring those planes out of Antarctica. This chance tip was followed up, and it was learned that the same man had decided that if he could get away with one plane, he might as well try to get away with two much larger aircraft and with the millions of dollars' worth of equipment, which was, in his mind, fair salvage somewhere on the ice cap of Antarctica. With the excellent cooperation of the Antarctic project officers on the White House staff and with the support of the Navy, all of this equipment and the planes were recovered and returned to service.

          These are special cases and do not reflect upon the system so much as they do upon the actions of a few individuals. The problem is that the U.S. Government is not properly constituted to deal with such actions when they are cloaked in heavy security wraps, and the incidence of such happenings is far greater than it need be, since in most cases there should not have been any security over any of the projects. The cost of allowing the ST to operate in secrecy is high.

          There are a number of aircraft that have been completely scrubbed of all usual identification, and they are operated by the services for the CIA. For those unfamiliar with the complexities involved in maintaining aircraft, it will be worth a partial explanation to show what problems arise. The huge radial engines on these large transports are all carefully marked with serial numbers, decals, and other special identifications, which are so coded and catalogued that the men who do the heavy maintenance on them in the major depots of the services can work from drawings and instructions that are in turn coded to match the engine series involved. When engines are made non-attributable, for CIA use, all of these markings are removed or changed. This means then that only certain crews can work on these engines, and they have to be cleared to know that the aircraft are special.

          Sometimes, something will happen to an engine when the plane is far from its regular base. In such instances, a message is sent to the nearest Air Force base commander, and he is told to fly a maintenance crew there to get the engine and to "melt", or destroy it. Instead of working on the engine and revealing that the plane and its intended mission were classified, a costly engine is destroyed. Then that engine must be replaced by another identical non-attributable engine before the plane can continue its flight.

          Sometimes things will happen to the plane itself. The Air Force had a number of special aircraft in Europe that had been converted to use for certain classified projects, although from outward appearances they were perfectly normal four-engine transports. One time, one of these aircraft had a simple nose-wheel problem. It should have been an easy thing to have it worked on at the base and returned to fight operations. However, some of the simpler maintenance work had been turned over to native teams. One such activity was the repair of nose wheels. To keep this problem from the natives, a CIA crew chief took a torch and cut several of the main electric cables in the plane, then grounded it for serious maintenance problems. He thought that this would get him the authority to hire an American contract crew that could work on the nose wheel as well as on the cables.

          Since the inspection report showed very severe damage to the plane, the reviewing authority in the United States would not authorize a team to fix the plane, and instead ordered it to be salvaged. In the salvaging process, the alert CIA had one of its civilian units bid for the plane, and in a short time it was back in the air, in good shape, as the property of a civilian airline, which put it to work in its own interest and incidentally for the CIA whenever requested. This could be called an inadvertent windfall. But in any event, it was very costly and had it not been for the security measures that made the whole thing unwieldy, the damage could have been repaired easily and the Air Force would still be flying that plane.

          By the late nineteen-fifties, the CIA logistics system had all it could handle all over the world. It could deliver such unit shipments as forty thousand arms by airdrop in the period of a few days or it could send aircraft and helicopters into Laos and move tens of thousands of Meo tribesmen from one part of the country to another with ease. By that time, the CIA had no less than eight hundred to one thousand units, all cover units within the DOD. This was a huge and intricate system.

          The Agency did not man all of the units. Many of them were no more than a telephone number with someone to answer the phone and give information or receive calls. If, for example, a group of military personnel from a foreign country were passing through Washington on their way home after a school on a Military Aid Program quota, and they had been told to get in touch with a certain contact, they could call a number in Washington and their contact would answer the phone and tell them where to meet him, where they were to stay, and so on. If a defector had been flown to the States, was living in some safe house, and was not permitted to leave unless he was escorted for his own safety, he could call a certain number in Washington and ask for a certain military officer, who would give him instructions of one kind or other.

          Some of these "phone-drop" organizations were used for nothing more than to requisition supplies from another service. The supplying service would never know that the requisitioning outfit did not really exist. Of course, the Agency would go through the details of making certain that the units it was using were listed in the supply catalogues, in the regular military postal catalogues, and in other normal references.

          Other units were manned with many people and served as active training units, storage sites, or operational facilities of one kind or another. In such cases, the manning would be either all Agency in the cover of military, or Agency and military blended together, or it might be all military supporting the Agency. In the latter case, the unit might be an Air Force Squadron that had aircraft and other equipment maintained in readiness complete with well-trained crews ready to fly out for the Agency on any of a great number of special missions. Everything possible would be done to make it appear to be a real Air Force unit.

          Few people, even among those who are supposed to know all about the Agency's relationship with the DOD, have ever known exactly how many such units exist, and what is more important, what these units really do.

          One day back in 1960 or 1961, it was necessary for me to brief the chairman of the JCS on a matter that had come up involving the CIA and the military. Such briefings, when they have been put on the regular agenda of the day, take place in a sort of reverse pecking order. Each item that comes before the Chiefs is briefed by its staff-supporting office from the least sensitive to the most highly classified. On this day there were a number of briefings on all sorts of subjects. The room where the Chiefs met was full and the anterooms were packed with briefing teams. One by one the teams were called in to give their briefings. As they finished, they would be dismissed, and if the Chief of any given service had any of his top-level staff there with him, he might dismiss that officer along with the briefers. (Sometimes, when one service is briefing, a Chief of another service will want to have one or more of his senior assistants there to hear the briefing with him.) As a result, as the briefings progress from least classified to most highly classified, the whole group begins to thin out. This is done with a very precise control, verging on the ritualistic.

          Finally, the briefings on atomic energy matters, missiles and space, and other highly classified matters took place. Then the Chiefs began to hear some of the more closely held intelligence matters. The last item was the one that pertained to the CIA operational information. As I was ushered into the room I noted that everyone was leaving except the chairman and the commandant of the Marine Corps. The chairman was General Lyman L. Lemnitzer, and the commandant was General David M. Shoup. They were close friends and had known each other for years.

          When the primary subject of the briefing had ended, General Lemnitzer asked me about the Army cover unit that was involved in the operation. I explained what its role was and more or less added that this was a rather routine matter. Then he said, "Prouty, if this is routine, yet General Shoup and I have never heard of it before, can you tell me in round numbers how many Army units there are that exist as "cover" for the CIA?" I replied that to my knowledge at that time there were about 605 such units, some real, some mixed, and some that were simply telephone drops. When he heard that he turned to General Shoup and said, "You know, I realized that we provided cover for the Agency from time to time; but I never knew that we had anywhere near so many permanent cover units and that they existed all over the world."

          I then asked General Lemnitzer if I might ask him a question. He said I could. "General," I said, "during all of my military career I have done one thing or another at the direction of a senior officer. In all of those years and in all of those circumstances I have always believed that someone, either at the level of the officer who told me to do what I was doing or further up the chain of command, knew why I was doing what I had been directed to do and that he knew what the reason for doing it was. Now I am speaking to the senior military officer in the armed forces and I have just found out that some things I have been doing for years in support of the CIA have not been known and that they have been done, most likely, in response to other authority. Is this correct?"

          This started a friendly, informal, and most enlightening conversation, more or less to the effect that where the CIA was concerned there were a lot of things no one seemed to know. It ended with those two generals asking me about matters that they had unwittingly participated in during earlier years that they had never been told about.

          It was amazing, very basic, and very true that a great number of operations, some of them quite important in terms of foreign policy, and usually involving one or more foreign nations, had taken place in the guise of military activities when in reality they were not. Since the military had been used for support purposes, first in the context of war planning and later for more open and more active roles, as the CIA and the ST became more powerful and bold, the military had continued to believe that whatever it had been asked to do must have been sanctioned from above by someone.

          This brings us back to the Dulles-Jackson-Correa report. One of the major undertakings of that report was to place the CIA quietly within the structure of the entire U.S. Government, ostensibly to obtain more complete secrecy when necessary. For example: It was necessary for the CIA to arrange for aircraft to enter the country quite frequently without the usual customs check that all military aircraft must undergo. In the earlier years the CIA would arrange directly or through State or Defense to have customs waive inspection of a plane with classified cargo or carrying a defector or on some other highly classified mission. Then, when such things had become more or less commonplace, the CIA would politely offer to provide a few men to work with the regular customs personnel to take the burden for such activity from them. This was the way it was put in the first place, and the customs office would gratefully accept the assistance. The CIA would go through all the necessary steps to get authorization for increasing the manpower allocations in the customs service by the number of men it planned to put there and then to make arrangements to reimburse the customs office for the payroll and other costs of the office.

          This latter step would always be taken, because it would be best for the customs office to go through all of the normal motions of paying these men, including promoting them and paying for their travel or other usual expenses, so that their assignment would appear to be completely normal to all others in the office. Then, by special accounting procedures that would take place in the main office, the CIA would reimburse the Treasury Department for the money involved.

          In the beginning this would all be done with elaborate open-handedness, even to the point where the new agency men would receive training and other prerequisites of the job. However, as the years passed, most of this procedure would be forgotten, and few would recall that those special assignments had even originated with the Agency. Accountants who had known how to transfer the funds would have been transferred themselves, and the Treasury Department might no longer bill for the costs involved. But the Agency men would stay on, their replacements would be carefully fitted into the manning tables, and few would even notice that they were there.

          This has happened quite extensively in a great many places all throughout the Government. There are CIA men in the Federal Aviation Administration, in State, all over the DOD, and in most other offices where the CIA has wanted to place them. Few top officials, if any, would ever deny the Agency such a service; and as the appointive official departed, and his staffs came and went, the whole device would be lost with only the CIA remembering that they were still there.

          Many of these people have reached positions of great responsibility. I believe that the most powerful and certainly the most useful agent the CIA has ever had operates in just such a capacity within another branch of the Government, and he has been there for so long that few have any idea that he is a long-term career agent of the CIA. Through his most excellent and skillful services, more CIA operations have been enabled to take place than can be laid at the feet of any other, more "legitimate", agent.

          This was the plan and the wisdom of the Dulles idea from the beginning. On the basis of security he would place people in all areas of the Government, and then he would move them up and deeper into their cover jobs, until they began to take a very active part in the role of their own cover organizations. This is how the ST was born. Today, the role of the CIA is performed by an ad hoc organization that is much greater in size, strength, and resources than the CIA has ever been visualized to be.

          There is another facet to this type of organization that has had a major impact upon the role of secret operations in this Government. With the spread of the influence of the CIA into so many other branches of the Federal Government, the agents found it very easy to make friends and win willing disciples in their new surroundings. There is a glamour and allure to the "fun and games" of Agency work that appeals to many people, and they go out of their way to provide support above and beyond what the CIA has ever asked for -- or thought to ask for.

          As a case in point, consider the U-2 project. The Lockheed Company came up with the plane, but the Air Force knew it could not use it in peacetime and thought that it might be able to get it into use by offering it to the CIA. The CIA picked up the idea and operated the whole project, provided -- and this was a major "provided" -- the Air Force paid for it and actively supported it with men, material, and facilities. A proposal that began as a plan to get a new aircraft on the production line for Air Force reconnaissance purposes thus became a project to get the plane flying for CIA photographic intelligence purposes. As the photographs began to come in, the input data from them began to dictate new operations that arose not from some foreign policy or national planning staff, but from intelligence sources. Intelligence input began a cycle that supported intelligence itself. A new machine, which required more and more support of its own actions, was born within the Government.

          By the time of the Bay of Pigs operations, the CIA was part of a greater team, which used the Agency and other parts of the Government to carry out almost any secret operation it wanted. By that time this organization had the equipment, the facilities, the men, and the funds to carry out clandestine operations that were so vast that even on the basis of simple definition they were no longer truly secret, nor could anyone hope that they might be.

          The availability of supplies and facilities made it possible for all of this to come about. The growth of the CIA and of the greater ST has resulted more from the huge success of the DD/S side of the Agency than from either the DD/P or the DD/I. When Allen Dulles had abolished the DD/A (Administration) he had put nearly everything that was not intelligence and that was not secret operations into the DD/S division. The DD/S became responsible for the function of budget and comptrollership; for personnel and for the special personnel function that is most important in the Agency, personnel cover; for communications; for research and development including that very special Agency shop that is responsible for the development of all of the very special gadgets and other devices so important to the trade of intelligence; for transportation; for facilities -- a special resource so vast that few people even know 50 percent of what exists; for supply, and for maintenance.

          Many of these functions, which are normal to any major enterprise, take on special meaning in the CIA. In fact every one of these general headings has buried somewhere deep in its staff special arrangements that make the Agency what it is.

          Research and development is a most interesting enterprise as carried on by the CIA. For example, let us say that the CIA has a modified aircraft that it flies along the border of the Iron Curtain, or for that matter anywhere it wants to listen to electronic traffic. This monitoring airborne system is as sophisticated as the military can make it, and in many instances the CIA has been able to have even the newest military system modified to give it some special characteristics of particular use to the Agency.

          In the normal pursuit of its mission, the plane cruises at altitude on a prearranged course and listens to every thing that it hears on all wavebands. After the flight, the plane lands at its Air Force home base, and the tapes it made during flight are immediately taken from the racks on the plane, sealed in shipping containers, and put on the first jet to Washington. Within twenty-four hours these tapes are processed in a special readout laboratory that might involve computerized read-out as well as human listening. As a result of this process, there might be found a certain signal that appeared as perhaps no more than a bit of static on some normal-appearing carrier wave. More detailed study of this signal reveals that it is unlike the usual static and that there is a chance that this split-second blip is something special; but there is no known system for interpreting such a signal.

          A review of other tapes made in the same area might reveal that similar blips have been occurring on some of them. The CIA takes this up with the Air Force experts who designed the system and through them learns that the equipment was designed by a certain team working for a well-known manufacturer of electronic equipment. The Air Force, of course, has a contract with this manufacturer. The CIA goes to the manufacturer under the guise of the Air Force and asks what might be done to identify and if possible to read out the blips.

          The manufacturer agrees to take on the problem as an overrun to the original development contract with the Air Force. The Agency people, known to the manufacturer only as Air Force people, agree. In due course, the manufacturer finds a scientist at Stanford who has experimented with a remarkable tube that seemed to promise some solutions to the problems involved. A subcontract is let, and further work is done on the tube. Finally, the manufacturer is able to demonstrate a receiver that is able to find these blips, which are actually hidden at all wave channels, and to get them recorded on tape. They are now able to get this new equipment to stretch these blips to the right length in terms of sound waves, and before long these blips are shown to contain decipherable data.

          Now the development contract is terminated, and the receivers are put into production, also on the Air Force contract. As things turned out, the Air Force is able to use some of these fabulous sets itself, and it increases the production order. By this time, a small development project to which the CIA had agreed to contribute about sixty thousand dollars had grown into a total development project of more than one million dollars, with a long manufacturing and procurement contract on top of that.

          The important thing in situations like this is that through this method, even when it was used honestly and properly, the services can pay out millions for the Agency without realizing it. Most of the Air Force intelligence and electronics technicians involved in this case -- which though hypothetical, has its basis in fact -- were not also procurement experts and had no experience in the intricacies of such financial matters. As a result, they went along thinking someone else was taking care of the money. The Agency went along, protesting that if someone sent them the bill, they would pay it. The bills were rarely if ever sent.

          Such actions soon became known, and others who want work done for other reasons find the way to use this same technique. To cite a case: An Army project officer who had trouble getting his service to approve a new gun that he had been shown by a manufacturer found that a fellow officer, on a classified project, was interested in it. They demonstrated the new gun to a group, much as if it were a real Army demonstration. The manufacturer, willing to do anything to sell his new weapon, participated fully in these demonstrations and tests. He may have thought it odd that the tests had been scheduled at the Army Chemical Warfare station at Fort Detrick instead of at the Aberdeen Proving Ground where most tests are usually held; but he was selling, not asking questions, so he eagerly went along. After the tests at Detrick, there were meetings in a special section of the office of the Secretary of Defense, located near the office of the Deputy Director for Research and Engineering (DDR&E). The DDR&E representative was a prominent career civilian who had recently been made head of that office after a long tour of duty in the Office of Special Operations, where CIA matters were usually processed. In other words, this man was less an engineer than a special operations man; and he was less an Army or military counterpart than he was an Agency collaborator.

          At this meeting, there were many Army officers, and there were Air Force officers. There may have been Marine and Navy officers, and there were many civilians. The manufacturer's representatives could not be faulted if they believed that they were selling their new weapon to a most highly qualified group. In fact, the main sponsor of the weapon, an Army Lieutenant Colonel in uniform, gave all appearances of being the Army representative, which he was not. The meeting ended with a consensus that the gun should be purchased in trial numbers by the Air Force for security reasons "for use by the Air Force Air Police units". Later, the Air Force did purchase tens of thousands of the new weapons, and they disappeared into the security-covered inventory of the CIA. This is a part of the story of the M-16 rifle of questionable repute in the Vietnam operations.

          With the passage of time, the Agency has become more adept at getting any supplies and support it needs and in getting them supported, stored, and transported. (The story of the Agency transportation capability will be told later.) All military equipment is controlled by an elaborate supply system, and the funds that are required to develop, procure, and maintain this vast store of equipment all over the world are detailed in the budget. Anyone can easily make a case for occasional errors in such a vast system. There have been those who, along about budget time every year, show how the Air Force has purchased $.15 nuts and bolts for $28 each, how the Navy has procured 5,400,000 shrimp forks, and how the Army has been paying three times as much as the Navy for a common hospital blanket. In spite of all of this, the logistics services of the military establishment do an amazing job, and no military services in the world have ever had the support that they have provided. It is within this fabulous system that the CIA logistics experts, most of whom are retired military personnel themselves, have learned to create miracles.

          There is on the books of Congress and in the Law of this country an old bit of legislation called the Economy Act of 1932. It remains in force, as amended. In theory, it is simple and important. During the early years of the depression it was found that a considerable amount of money could be saved if the Congress would permit the various departments and agencies of the Government to trade among themselves when one had a surplus that the other wanted. It used to be that each department had to keep rigid accounting of what it had and that it could not transfer what it had to another department. This Economy Act, among other things permits one department, say Agriculture, to let the Army, for example, buy desks that it may have in excess for a price to be agreed upon by both departments. This law has worked well, and it has permitted savings among all parts of the Government.

          Early in its history, the CIA looked at this law and found that it could be used for some interesting purposes. The CIA might like to purchase some equipment that it could not afford or more likely, that it did not want anyone in the Government to know it had acquired. It would have one of its people, most likely "covered" in some other department, meet with the owning department and sound it out about the purchase, "in accordance with the provisions of the Economy Act of 1932, as amended". Usually, the Agency would know beforehand that the equipment was available and that the selling department would practically give it away. The Agency would then conclude the action and buy this material with funds of the department under whose cover it had entered into the agreement.

          In certain cases, the buying department would require the Agency to reimburse it for the cost of the transaction; but increasingly this became a doubtful process. At other times, the CIA would approach another department, through a cover cut-out, to an office where it also had another cover arrangement.[2] These offices, bickering with each other as separate departments, would arrive at an agreement that they would actually staff through other sections to make it appear to be scrupulously legal and authentic, and then the CIA would end up with what it wanted without the expenditure of any funds.

          Even the retelling of some of these arrangements sounds ridiculous, and the reader may be excused for wanting to believe that this could not have happened. Not only have things like this happened; but some that are even more portentous. The Agency will go to any ends when it has convinced itself that it is doing so on the grounds of security. The Agency, at the constant reminder and conditioning of Allen Dulles, always believed that anything it did was all right as long as it was carrying out the will of Congress to protect its secret sources and methods.

          After decades of logistical endeavors of all kinds and of all types, the Agency has acquired more than enough in hardware, in facilities, in transport and warehousing to perform all the peacetime operations it could ever dream of. And if it should come up with a specially large project, it would easily supply itself from within the hoards of other departments and agencies. To the Agency, cost is no barrier. When things can be delivered by air, they are delivered by air, regardless of cost differential. When equipment can be obtained new, it is purchased new rather than surplus, when new is available. It is not so much that the Agency was always that way; but it became spoiled, because since Louis Johnson's time, just before the Korean War, there has not been a Secretary of Defense who really concerned himself with the cost of supporting the CIA. There has not been a Secretary who knew enough about what the CIA was really doing to believe that the volume of material warranted concern over the cost. So the Agency found its pipe attached to the boundless sea, and it learned to make the most of just letting it flow in.

          The same can be said of the Congress. There are no members of the House or the Senate who have ever contemplated in anywhere near exact amounts the great volume of men, money, and materials the Agency has been able to acquire and to expend without observation by those normally charged with that responsibility. The Agency excuses its own actions on the basis that it employs these methods secretly for the good of the country; thus, it does not have to expose its sources and methods as it requests men, money, and supplies in the usual manner. Once the Agency has become accustomed to this form of rationalization, there are no limits to what it and its peripheral operators will be perfectly willing to do "for the good of the country" and for the cause, always unquestioned, of anti-Communism.


  1. The Agency makes a specialty of covering its people with code names as they travel around the world. Thus the message traffic will he gibberish to most people when a list of names of the Agency's key men appear. Many years ago, "Red" White and another executive from Mr. Dulles' office made an extended trip through the Pacific. They were given code names just before they left. Some genius in the cover department gave "Red" White the code name "Ballew". As he traveled from station to station it was "Red, White, and Ballew", like the flag.

  2. A cover cutout is some device or process that has been set up to circumvent or otherwise bypass normal procedure so that the connection with the CIA cannot be discovered in the normal course of business.

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