August 18, 2017

1967. The Central Intelligence Agency's Long Financial Reach

The Department of Dirty Tricks
The 6th World Festival of Youth in Students in Moscow, later revealed to have been infiltrated by the CIA (source)
Bill Downs

ABC Washington

February 19, 1967

Official Washington was reminded this week of the double standard by which the citizens judge their government and its operations. It's a Puritanical and, some say, a hypocritical ethic, the kind that made Nathanial Hawthorne's The Scarlet Letter an American classic. For it is still a fact of life in this country that the people regard secrecy in government very much like they regard adultery in marriage. Or more accurately, they seem to equate the super-secret Central Intelligence Agency with the kind of man who finds it necessary to keep a discreet mistress as a professional sideline. It's really no one's business as long as the mistress doesn't interfere with his family, that he keeps her out of the neighborhood, and above all he does not get caught.

As this week in Washington ended, the most avidly-read publication in the national capital was not the Congressional Record with its slightly juicy revelations of the investigated antics of Adam Clayton Powell. It was a slick, West Coast, monthly publication called Ramparts magazine with a story about the CIA which during the week captured the top headlines from the war in Vietnam, the troubled Cultural Revolution in Communist China and the political pronouncements from the White House and Capitol Hill.

The Ramparts' exposé revealed that the Central Intelligence Agency for years had been consorting with its mistress of secrecy right under the noses of some of the most respected members of American society. The Agency not only brought her into the neighborhood but actually brought her in the nation's bedroom, so to speak, to entice innocent young collegians in the National Student Association.

Not only that, it now develops that the CIA, in its secret efforts to advance American foreign policies and defend the nation from infiltrating espionage agents, also employed the international departments of a number of AFL and CIO unions, including the American Newspaper Guild, which when I was a member was concerned with getting the normal $25 a week salaries of legmen raised to maybe $30 a week.

CIA gold also was channeled into the US branches of a number of so-called egghead and do-gooder organizations such as the international society of writers called PEN—or the Paris-based, highly intellectual Congress for Cultural Freedom.

But most startling of all was the complex and most cumbersome method which the CIA used to disburse its secret money. More than a dozen wealthy foundations have been named as conduits for the Agency's dollars—dollars which, incidentally, by law the CIA does not have to make a public accounting.

These foundations, which channeled the money into a myriad of projects connected with the CIA's overseas intelligence operations, were based in such disparate places as Boston, Philadelphia, Columbus, Baltimore, and Dallas. Over the years, millions of tax dollars were involved. The foundations don't pay taxes, so presumably the CIA funds were not themselves taxed.

But what the Ramparts magazine article did was to open a floodgate of criticism of the Agency. For the Central Intelligence Agency, like the respected adulterer, made that unforgivable mistake—it got well and truly caught. But of more seriousness, as the professional intelligence officials put it, the CIA has lost its fig leaf—or rather a whole vine-full of fig leaves—which is going to make its covert operations overseas more difficult.

This correspondent spent some fifteen or so years as a foreign correspondent working around the world, including a wartime year in the Soviet Union. We suspect that the hullabaloo over the CIA's financing of students to attend international youth rallies, the financing of international labor organizations to teach democratic unionism to the working men of developing nations being wooed by the Communists, the secret sponsorship of professional organizations to counter totalitarian propaganda among the intellectuals of the world—we suspect these revelations are causing much more sensation here in Washington and across the country than they are in most foreign capitals.

In Moscow, for example, we found that every foreign correspondent was automatically assumed to be an intelligence agent for his government. News reporters deal in facts. Facts about Russia, put together even in the most innocuous story, constitute intelligence in the Communist mind. It did no good to explain that the private companies like the press associations, newspapers, and broadcast networks who sent their own correspondents overseas did so as a competitive business policy to sell the news collected by its correspondent-employees. To the Kremlin we were foreign intelligence agents. And to make it clear, they assigned black-capped and leather-coated members of the secret police to follow us about and report what we were up to.

Let me clear up one point here. When I was in the Soviet Union there was no CIA. The Office of Strategic Services under General William Donovan was just getting its intelligence service organized. To my knowledge, the news organizations for whom I worked overseas never accepted a dime of federal financing. For the United Press, CBS, and the American Broadcasting Company to allow its correspondents to become secret agents would risk the basic asset of the news that it markets—the integrity of their news gathering staffs. Destroy that integrity and the news organization is destroyed. It would be just plain bad business, because the UPI and the Associated Press and the broadcast networks market their integrity and their news not only in the United States but in foreign countries as well.

So while the current flap over the Central Intelligence Agency has surfaced many of its overseas operations, we suspect that the intelligence organizations in most capitals of the world darn well knew or suspected what was going on. In the case of the Russians and other Communist countries, the KGB and other secret police groups would expect the CIA to use American students. They've been doing it for years. Just as here in Washington it's generally assumed that the foreign correspondents for Pravda, Izvestia, and Tass most certainly are expected to work for the KGB. In fact, it's their patriotic duty by the standards of the USSR.

But what disturbs many people here in Washington is the extent to which the CIA secret operations have penetrated the economic and intellectual structure of our society.

For example, the Agency has channeled some of its money into the publication of books, good books which give a fair picture of the country and explain its origins. To give these books the necessary "cover," as it's called, reputable publishers put them on the newsstands for sale to American readers, thus divorcing them from any covert propaganda purposes when they are distributed overseas. This raises the question of whether there is something wrong about the US citizens purchasing again a book for which he has already been taxed to publish. Or more seriously, it raises the question of whether any democratic agency should ever be in a position to secretly propagandize its own people.

The use of federal funds to finance collegiate delegations overseas could and should be a worthy educational project. But for the CIA to make secret use of the National Student Association for this end has raised serious questions about the integrity of American education.

Allen Dulles this week defended the action, which he administered at the time when he was directer of the CIA.

"If you studied the student conference movement abroad during those years of the early 1950s," Mr. Dulles explained, "you would find that the Communists were making very effective use of them. The international conference had great propaganda value for them, and were influencing the youth in the United States as well as in other countries."

The question still remains: having succeeded, why didn't the CIA get out of the National Student Association? Its so-called fig leaf cover became more transparent as each graduating class increased the number of young people aware of the CIA secret. And, sure enough, it was a former NSA official which blew the whistle on the Agency in the Ramparts magazine article.

President Johnson this week ordered a review of the CIA's involvement and assistance to the Student Association and other areas of the nation's education establishment. The Washington Post says today that the investigation will probably broaden its scope to look into the CIA's involvement with American labor unions, charitable foundations, and ostensibly independent organizations and other institutions.

Mr. Johnson appointed a three-man panel to make the study, composed of Under Secretary of State and former Attorney General Nicholas Katzenbach, Secretary of Health, Education, and Welfare John Gardner, and the present CIA director Richard Helms.

Congressional criticism already is blowing from Capitol Hill about the membership of the investigating group. "It's like asking an errant husband to investigate his mistress," said one Congressman.

Translated, that probably means that before the fig leaves have settled to the ground, either the Senate or the House of Representatives—or both—will be getting into the act.

More than a century ago, observing foreigners traveling in the United States returned to their homelands to write books about the brash young country. Eminent writer such as Alexis de Tocqueville, Charles Dickens, and Oscar Wilde, to name a few, variously admired or criticized many facets of US life. But they all agreed on one thing: Americans have big mouths. Their pride and energy make them talk too much, and living in a broad and open country where freedom of speech is a way of life, they have a great disdain for secrets—especially official secrecy.

Therein lies the paradox of the Central Intelligence Agency and the roots of the troubles which now are plaguing it. In the open society that is the United States, how does the government and its people accommodate an institution which, to serve them, must remain anonymous?

The authoritative Washington Star today raises the question of whether "the current flap over the CIA can be escalated to the point where it will destroy the nation's intelligence organization." We don't think so. In the nuclear era of what might be called the possibility of "instant stone age," if the CIA did not exist then Congress and the White House would invent it.

We do think that the Central Intelligence Agency can, like the snail, emerge out of its shell so people can observe and understand it. Like the snail, the Agency can keep its most sensitive organs concealed and people can still admire its impressive super-structure.

For ironically, by public declaration of virtually every CIA director from Allen Dulles to Dick Helms, about eighty percent of the enormous work that the Agency does is in the non-secret area. Today's intelligence mostly is made up of collecting, collating, and assessing overseas publications, winnowing statistics and details from agricultural, engineering, and professional journals, scanning big and little newspapers for national trade and troubles, and most important, monitoring thousands of broadcasts in dozens of languages which serve to update the top secret National Intelligence Estimate—a global summary of events prepared for the president and the National Security Council each morning.

The Agency has boasted that it has "the most comprehensive information retrieval system now in operation anywhere," with rows and rows of electronic memory banks, specialized miniature photographic machines, facsimile printing devices, and punch card indexes which contain more than fifty million cards.

One intelligence official once boasted that the Agency had collected a most eminent group of scholars knowledgeable about China, and that this collection of Sinologists was better than any university staff in the world.

For what it's worth, we suggest that the CIA's information retrieval system would be of great value to the students and historians throughout the country—that the CIA's historians and scholars should be shared with the nation when they can be spared.

We even suggest that someone in the Agency be allowed to come right out and say that there's a $60 million building on the banks of the Potomac in Langley, Virginia that several employees drive out to for work every day, and that they proudly work for the Central Intelligence Agency, which is a keystone to the defense and security of the nations of the Free World.

Let the Agency keep its so-called "department of dirty tricks" to itself. But when the government needs American students to attend the next International Youth Conference, let the appeal be open and above-board, not a behind-the-barn operation.

This is Bill Downs for ABC in Washington.