OSS - OFFICE OF ECONOMIC WARFARE ANALYSIS/BOARD OF ECONOMIC WARFARE/AGREEMENT ON DIVISION OF LABOR, 1943

• Document Type: CREST
• Collection: OSS Collection
• Document Number (FOIA) /ESDN (CREST): CIA-RDP13X00001R000100040002-8
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 41
• Document Creation Date: November 3, 2016
• Document Release Date: September 17, 2013
• Sequence Number: 2
• Publication Date: April 1, 1943
• Content Type: MISC

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April 1,
Mr. dean Cleveland,
Assistant to the Chief,_
Office of Economic Vbarfare tnelysis,
Bo&rd of Economic rfare,
Washington, D. C.
Dear Mr. Cleveland:
After thinking over tae mutual problems
raised during our last conference, it seems wise to
me that each agency should have its own cartography
group. We have therefofd presented to the Bureau
of the Budget a request that tne number of positions
allotted to the Board of Economic Wprfere in our
19444-budg?L be dtleted and that the Board of Economic
Warfare be permitted to set up its own cartography
section.
\I I regret that the nature of the vFork
involved, that, cartograpay, precludes the co-
ni
operative use or por onfte141 I see no reason, how-
e'er, why there abo d not continue to be the best
of personal coordi tion between the efforts of the
_ two sections. There may be many technical services
which wo say render to the Board in comection with
cartographic work, and ike shall be happy to do so
) if it i.:; desired.
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*et,
Sincerely yours,
Willits J. Donovan,
Lirector.
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MEMORANDUM
TO:
FROM;
SUBJECT:
OFFICE OF STRATEGIC SERVICES
WASHINGTON, D. C.
Colonel Donovan
Donald C. McKay
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Sept ember 7, 1942:"'c
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Addendum to Memorandum of September 2 from
Emile Despres to Colonel Donovan on "Letter to
General Smith from Milo Perkins Dated August
28, 1942 and Attachments."
The previous memorandum emphasized the fact that
the Economics Division is an integral part of the Research
and Analysis Branch (hence should under no condition be
divorced from it). That fact is brought out even more
clearly by the current organization of capabilities teams
for the purpose of rendering more effective the work of
the Office of Strategic Services for the Joint Intelligence
Committee.
These teams are of two types--functional and
area. The functional teams (e.g., Japanese manpower,
industrial resources, military supplies, etc.) consider
basic problems of Japanese potential. The area team for
Japan considers how the Japanese could utilize in parti-
cular areas this basic overall potential.
Area teams use economists, geographers, historians,
political scientists working in close cooperation. This
cooperation is even more evident in the functional teams:
a team on Japanese manpower will involve the intimate
cooperation of research analysts thoroughly conversant
with the Japanese language and economic analysts who are
students of manpower problems in general. Neither could
function without the other. The same situation obtains
elsewhere in varying degrees (e.g., in the study of Russian,
Chinese, and German capabilities).
So significant is the work of the economists and
so closely related to that of other specialists that any
divorce of the Economics Division from OSS would at once
eliminate our program of serving the J.I.C.
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The function of the capabilities teams will be
obvious from the attached outlines on ',General Japanese
Capabilitiedi and "Japanese Capabilities in a Given Area.,,
Similar outlines are being prepared E4S guides to the
preparation of papers for the J.I.C. in other areas.
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Non
The Planning Committee presents horowith
two outlines;, Tho first, on "General Japanese
Capabilitiesor is offered as a guido to tho study
of overall Japanese war potential, Tho second,
"Japanose Capabilities in a Given Area," is con-
cernod with the application of this potential to
a specific geograPhic region., This second outline
envisages OffealSiVO action b/ 5apani With slight
modifications, it can, however, be usod for the
study of Japanese capabilities to resist attack
in aress iho now holds?
Although those outlines have boon prepared as
the basis specifically fer studios of Japanese
capabilities, it is hoped that thoy may bo of use
as World. pidas for tho study of Axis capabilities
in other areas.
,I.
kupst 12, 1942
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COITIDENTIAL
Genoral
The primary object of this type of analysis is to deter-
mine and evaluate Japan's objectives and the military strength
that Japan now has available, or will have available in the
future, to pursue these objectives in any or all theatres of
war; another object is to arrive at an evaluation of Japan's
long-term staying power under alternative conditions of con-
flict--i?eis to determine the effects on actual military
strength of the exhaustion of irreplaceable resources and of
social and political developments; a third is to ascertain
Japan's principal vulnerabilities as a guide to Unitcd Nations'
policy for bombing and other form of direct action; and a
final object (in conjunction with the analyses of Japan's
capabilities respecting specific areas) is to appraise the
relative importance of military, economic, and political
factors in the determination of Japanese strategy.
By Whom and by what process are Japanese short-term and
long-term policies established? What degree of flexi-
bility do they have? To what extent are they influenced
What are the long-term objectives of Japanese policy
Which influence her conduct of the war? What are the
intellectual and emotional foundations of Japanese policy
40,
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In the eyes of those controlling Japanosc policy, What
Is the relative importance and urgency of the various
3pocific objectives open to Japan at any one time?
Supply and utilization of manpower and conmoditioa.
Intensive study of the itoms listed below should
thoroughly covor the following points, wherever relevant
(1) ostablishmont for somo past date of reliable figures
for (a) strength, or quantity on hand, (b) quality, and
(c) rate of production (or training), and productive
capacity; (2) construction of a time-curve of production
(or training) from that date to thc present: (3) cons-
truction of a timo-curve of losses (battle losses, ordi-
nary consumption* depreciation, and obsolescence) from
the base date to the present; (4) estimate of present
strongth or quantity on hand (1+2-3); (5) dotailod
distribut4on among various usos of present strongth or
quantity on hand; (6) comparison of requirements (con-
sumption, losses, etc.) in curront year with probable
supply; (7) forecast of strength or quantity on hand at
end of year; (8) forecast of distribution at end of yoar
nilitary, naval, air: strength, training '
distribution
undoratood that in a finishod study those uloments must
16ograted into a total picture of military strength.
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a.
1.
CCITIDENTIAle,
3
b. kara-military sorvicos.
c. Employed population--occupational breakdown
and training.
de Other members of population
(Noto: Availability of non-Japanoso popu-
lations should bo considorodo)
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2. Finished commodities
a. Military, naval, air equipment; ammunition;
high explosivo
b. Plant equipmont (factories, mines, farms, etc.)
co Transport equipment (rail, road, air, water)
do Communications equipment
oo Consumer goods
3. Semi-finishod commoditios
a. Iron and stool (ingots, armor plato, special
alloy stools, otc.)
Non-forrous metals
co Light motals
do Chemicals
eo Other
4. Raw materials
a. Mining
be Agriculturo
c. Fishing
d. Forestry
*L s undorstood that in a finished study those olomonti must
bo integratod into a total picture of military strongth.
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.6 and canals
,opaph, telephone, and radio
Chiological capabilitios
Political capabilitios
1. Effoctivonoss of administrativo organization
a. In Japan
13.0 In occupiod aroas
a. In Japan
b. In occupiod aroas
Effoctivonoss of moral?
Effectivonoss of diplomacy in winning allios
arimmy of tho factors includod undor hoadings C and D is dosignod
to indigent? (1) thcoxtont to which political and social at-
titudas, and moralos aro or may influonco tho military situation
and (2)tho oxtont to which tochnological advancomont and ad-
mlnistrativo offIcioncy affoct tho rato and offoctivonoss of sub-
stitutivn and tho rate of programs in dovoloping now rosourcos.
04,60
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C(,:TIDEIT
JAPAYESE CAPADILITILS IN A GIVEN A,-?EL
I. Definition of tho area under consideration
10, Total area under consideration.
2. Lesser part or parts that might be subject to conqui-st
without requiring conquest of the whole area.
a. Rolation of those parts to each other and to the
whole in terms of routes and sequencc of conquest.
(If there are any possible subdivisions,
then all the studiJs throughout the outline
must anticipato answering questions according
to altornrtivo hypotheses for (1) thc entire
area, and (2) each possible lesser part).
II. Objectives.
This rubric in concerned with what Japan wants to
accomplish, not with what she can accomplish.
1. Military Considerations
a. How would such 'a conquest improve Japants
position? e.g.,
--By preparing the way for further conquests.
--By providing Japan a more defensible position.
b. How would such a conquest mak= the United
Nationst position?
--By reducing their power aild bringing the war
nearer to a conclusion (0.g,, through the
capitulation of China).
--By reducing or'oliminating a foreign monnco
to Japf%n (c,,g., by the conpost of Eastern
Siberia).
(2460)
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Wator Supply.
Health and Hygiene conditions.
Notable logistic difficulties within the arca
inadequacy of ports, railroads, roads, etc.
Special problems presented by vital, dofondod
points.
Probably popular resistance to, or intorforonco
with, the conquest of the area end the subsoquont
administration of it.
Strongth of the United Nations in the given area and
facility with which rolnforcomont could bo accomplished.
Size and character of military, naval, and air forces
estimated to be nocessGry for accomplishment of
total or limited objoctivosi
Estimated costs to the Japanese of such
in mon and mai:oriel.
--What forces are available olsowhoro and with
what facility can they be moved into the
theatre of operations? How do commitmonts
elsewhere affect Japanoso capabilities in the
given al,oa?
Supplios for those farces (with omphasis on tho
availability of supplies in or noar the area undor
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Do general strategic and other considerations, as
developed above, point to an early or to a delayed
attack?
What is the relation of tho current position of
the Axis in Europe to the timing of an attack?
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OFFICE OF STRATEGIC SERVICES
WASHINGTON. O. C.
It wall agreed by 0444 and BeMelle that this work fail into three
satogorisss
isl ftecuresent of raw intelligence
b Preparation of heals reports en specific industries
Zoonsisio on4Tsis on the strategic level (manly for 41?I?04
It www also speed that, for the third catepry, has gone
tertkor, then Ba1?11?0 end has a better staff, better equipped to do
the enigitisal wok roqui3ed.0 The record shows that O.a.s. has
ase isportent eontributions to the lark of the wbile B.J.
bee contributed
itelteW. boo not 'withdrawal from this field, however. Marginal dupli-
natio $at reel frictiaa have continuede The fact that 0,Se8e
ooninot Itithdraw free, the first two categories of work also presents
prebissne
Maisie* if bawdiest between ths two swedes, which is one possible
astEllioar bee goto :lot been onsocessfal? It is doubtful that it can
be isigola the CMOs of Staff issue proper directives to the two
0,1100-otions ommoormed.
Woo loolgosotion. of the tape ogosoiso is an alternative soluticne
Thr transfer of stow the Zeonasics Division or the Re and A. Browne
ti p4,2434 Is untkinkahla. Both are essential to the moose-
fI tisWilentig 041.11.
tromotor ? t the bow Sraneh of Beleille to OeSeSe is entirely
Vito Tkta liresch has3itUs esenection with the rest of the
L*W. 404100.01011tieni ek US* WI it has are a handicap to it.
it Illetti he 14-$109t advantopous if the transfer to OJAI could
OffoOtOdip
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FROM !Wile Despres
SUSJICT Letter to General Smith from Mlle Perkins Dated August 28,
1942, and Attachments.
The letter trout Milo Perkins to General Smith of August grefirring
to infernal eenversetions bthe staff menbsis of the ?Moe of
Strategic Servioes and the Board of loononic Warfare, along with onalosed
0004/4 et infOrnsl 'Agreement, and a summary of tbe conversations to
&to as owns up ay the Soerd oZ Noononic Werftra, have been :x41'17364
Same f*rthar investigation of the problenm posed therela hes beem.nado?
The following moisten*. co Str. Perkins' letter correctly etates
Objeetives stmmanly sought by those staff menhirs conoerned in the
two sommeles, m
11110 purpose of thee, ***times end of the lmformal agreement
to try to *void duplication betften the two agencies, '
_Isloomneotion with the work whioh le done :Or the
Ansellignaes Committee..
th0 intervel that has elapeed since the meetings were held,
these nenbers of the staffs of the Offloe of Strategic, services and the
*ere Ilsonouto IrsTratme who ere 01414 concerned In the matter have
been fropooirt eentoot In an effort to Implement the spirit of the
Agrominet. Smeh inplemeatation has faded oertain difficulties, due
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partioularly to physical separation and a divided administrative
responsibility, to the further internal reorganisation of the Board
of Economic Warfare, and to certain disagreements between the two
agencies in their conception of the problems bri be handled.
lksms.ratesulpuLlokk
Avvidanoe of duplication has been to some e,&ent facilitated, on
the other hand, by the fact that the interests and oapabilities of the
staffs of the two Agencies have caused them to concentrate in different
fields of work. Thus, it has not been difficult to avoid duplication on
work done for the J.LIC: This is largely bonus* the Board of Economic
Warfare has concentrated its energy on the first two of the three types
of iebs referred to in the summary of the meeting of July 15: namely,
(1) proewressat of roe intelligent* (in the came of B.B.W. contributions
to seek imtelligenee are almost entirely obtained from business firma
sad besinoes men in, the United States eho are knowledgeable on the enemy
easemiy), and (2) preparation of certain Nude reports covering specific:
mow imenstries (moot of whish have been on the Far East). The third
jeb??ecenceict analysis me the strategic level-whas been largely neglected
WU. Dowd of loomomic 'tartar*, while at the same time it has been the
Opesial cow= of the Hicearch and Analysis Branch of the Office of
Stalitegas Servisoo. This, the overlap in this type of work so far has
Imes mon ammiami then real.
alIMIVAILABOadigaNgslitialditiniLlUng
Ito reosom for this is indicated in the statement on page 2 of the
IfOrli" of the meeting batsmen staff webers of the two agencies as
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prepared by the Board of Ite0110111.0 Warfare: In this field (analysis
of strategic soonosic factors) the Offioe of Strategic Services
(lgommaios Division) has gone further then the Board of Economic Warm.
fare and has abetter staff, better equipped to do the analytical work
required**
Some overlap in the functions of the Research and Analysis Branch
of the Offioe of Strategic Services and the Board of ZOODoide Warfare
stat persists in respect to the work on industrial objectives, despite
the efforts of the ?Mee of Strategic Services to avoid this field,
ler* again the quality of the staff of the Office of Strategic Services
has resulted in the Air Force repeatedly requesting this Office for
the July 15 meetings (1) Division or function, and (2) Analgenetion.
The motion of the minutes which discusses possible division of
fasetion shame elearli that those attending the meeting felt that if
this ealletteall.re stitesptsd4 0.45*$* should be given a clear field in
emba1gtiss1 stork ftr the J.I.C. and other clients, while B.W. should
WO* ea studios of industrial targets for the Air Force,
lasefer me pressureeent of intelligems is conoerned, B.LIT. had
elelehlisbed a field organisation for obtaining information fron
haliVi*Otissiamoss men and business files, while 0***S. was establishing
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its espionage sorviae. Dots agenoies reoeived izzforasin from a wide
variety of other ocarina.
ObviousliT, B.L. needed the 044. espionage services, and R. and A.
needed the information obtained by 13.2.111. Each organisation has made
inforwation available to the other.
&manse of the close contacts of (.8. with English and American
military intelligence organisations, the flow of information to the
R. and A. Economics staff is, on the whole, more complete than that going
to MO. It Is likely that R. and A. will further improve its relative
listed above. In additian to these, however, it should be pointed out
tile* the difficulties have been increased beeause (a) %XX has been nnp.
111.1113qt. abeadou its desire to work In the analytical field, and (b)
the Air Noes has repeatedly requested strategic information of an
SOOMOMI4 Wisreetav flak OAA., as noted above. The oxedlant staff of
041.16 bao made it difficult for the Air Throe to apply elsewhere for
oesokmbs wpocialisol studies which 0.8.13. was espeoially competent to
vospeet to imesetoisl objectives will disappear as B.E.ff. becomes better
eirismisot to handl* this type of work. However, in work done for the
$440C. Shore is a possibility of ocntinuing duplication. Efforts to
it ram a hook of ednimi *ratline problem', particularly amos 0.5.3.
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411;e41441
TM record of *colonic work done for the 3.I.C. bsexs out the
*bow statement. SUOMI the inoeption of the J?144,. in the middle of
lebruery 1942, 013.5. has prepared lug* parts of the following papers
sliesittod tbe J.I.O? SuU-COOpittAle to the Joint Intelligence
easmittee
SipIA* Carbaitits of Northern and Southern Supply Routes to Russia
3440 14 Japanese Capatt.Uties in Aleutians
$J.C. 1Gerson Casualties
10) luinorsbatty a Air Tern Routes
3.x.C. 21 itonah Capabilities
/401?C? 25 Suasion Capabilities
SA.40 X, Japanese Cspabilitiss -sod Intentions reprding Siberia
flol?C? 32. Gersas Strength i* I? larclis
Z.I.C. 40 aloroslit *wash Intentions in Nortturfest Africa
;41,044, 42 Air Treasport 10104 to fains
IAA. Lids sett lessias Cspabilities in the Colossus
siiiatdon, the GSA. hes oontributed to a large number of other
1144.04, loportos? The oontribution of %VOL to Ja.c. reports, on the
UM, bag tlOt UNA sonsidorable, and uswilly has been sub3e0ted to
rardsti 0.818. enslysts? Is a coo galore B?11?11. has contributed
joiastar with CUM* to a popes on Japsneoe Zconosdhe Capabilitixs, the
anninste of iate two sgonclos dIssceed on a umber of points, but tho
41.41
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opinion of the 0.3.5. was finally accepted in the majority of instances.
The Economics Division of 0.5.8. has also preparod a number of
analyses for the Joint Intelligence Comnittee's Daily Sumaary. Among
them have been:
1. Japanese Air Strength
2. German Manpower Position
3. The German Food Position
4. German Submarine Strength
5, British Bombing Operations
Finally, the extent to which thestaff of O.S.S. has acquired knowledge
and specialisation in the broad field which encompasses the relation of
eooncmic factors to the strategic position of the anew is revealed
clearly each meek in the work embodied in the 0.8.8. publication
21111.111abaita?
The record of ILEX. in the field of economic analysis evidences
nothing to match the work of the 0.8.3. staff. Indeed, it is unlikely
that a oompletely civilian organisation which is denied important infor..
matims of a silitary nature can carry out analytical studies of this
ehereeter. Memertheless, B.E.W. apparently is attempting to develop
a staff for sue* studies. The necessity for continued interchange of
views between M.S. technicians and B.11,11. technicians, while J.I.O.
or ether studios are in progress, than raises all the administrative
sed ether problems detailed above.
In view of the situation herein outlined, the Joint Chiefs of
Stuff it they do not wish to see all economic intelligence work placed
:oder ome orgmmisetios, might well contribute to the more effective
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working of BAN. snd 0.84.3. if they should direst that all anelYtieel
work tor the Joint Intelligence Committee or for the Joint Psychologisal
Urfa:" Committee be handled exclusively by 0.8.8. while ths
amass itself to the oompilation and analysis of information on
imtelligenee activities of the two organisations VAS discussed. At that
time, the alternstives of *soh joining the other 'ere consider4d aid
estivitieet mmi effortumitiee of sash economic group have been under
more *Use observatioa and certain conclusions have emerged clearly:
(e) the say fessIble sualgsmation would involve the transfer of the
tee smalytieal seetioso of the Dow Brooch of 144A. to the Research
and Analysis Drama of 04614 (b) such a transfer would vastly improve
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institution devoted almost exclusively to the gathering of information on
the enemy and the analysis of his position. B.EJ. is a large organisation
commerned chieily with operations relative to the control of exports and
imports from neutral tenitcries, particularly South America. Information
maths enomeseconomic position for blockade and other purposes has an
sxtrems4 United value to Almost all of the information that is
required is already available to B.E.W. through the Ministry of Eoonomic
Warfare. Within, the Office of Economic Warfare Analysis at BAJW., the
Insley Branch is but one part. The other branches consume a Tory considerable
portion of the time of the Director of the Offioe of "Canonic Warfare and
Analysis* Thus, a1t-6ough be sits on the J.I.G., he can devote little of his
energy to intelligence matters. Indeed, it was only recently that the Enemy
Branch of the Bolsi. evolved (through a series of reorganisations) into a
group resagnised as being separate from other B.E.W. functions. This
separation was shown to be eseential if enemy economic intelligenos was to
be at alladequataly handled. Ties that still exist between the Enemy Branch
of the Wise of Momomdc Warfare Analysis and the other branches are a handl-
eep ?ethos's, than an aid to the Enemy Branch. The oomplete separation of the..
ties, as a result of the transfer of the Enemy Bran* to 04.3.0 now appears
to be both, a feasible and a beneficial step to all concerned. As indicated
above, if the Enemy Branch remains in Bj.W., its functions must eventually
be to lted bedpans* of its inability to obtain from military sources
naa of tA* basis information required for a thorough analytical job on
oramposouomio smaXycis,
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Oa the other hand, the transfer of the ftonomics Division froa
the Research and Analysis Branch of 0,8.S. is impossible. The Zeman:ion
Division is an integral part of a larger teams the whole R. and L. Branch.
The Economica Division can not be separated without destroyistg tba work
of the Branch. The R. and A. Branch and its work are absolutely essential
to 0.8.3. 1111 MO*itsaselgamation with B.E.W. is unthinkable.
OP 1:114 G4i4reiCC:34X404."..:::1 71j
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OFFICE OF STRATEGIC SERVICES
IPTEROFFICE MEMO
?
it? s .sot I 164' Apo
TO: Mr. Wayne Nelson DATE:September 14, 1942
FROM: Ellie Despresee
SUBJECT: New Developments in Relationship between Research
and Analysis Branch, OSS, and Enemy Branch, B.
The prinoipal new developments in the
relationship between the Research and Analysis
OSS, and Enemy Branch, BEW, have been as
lollows:
1. The arrangement for joint represen-
tation In London on economic intelligence
matters contemplated in the informal agreement
of Ally 21, 1942, has now been carried out.
The arrangement is outlined in a letter from
Winfield Riefler, who has heel. appointed
Minister in Charge of international economic
matters at the American Eabassy in London,
to Dr. Baxter dated September 4, a copy of
which is attached.
2. Arrangements in Washington for
pooling of intelligence and of personnel
in regard to particular projects and assign-
ments have progressed further, as a result of
conversations between BEV and OSS reprosenta-
Uses. A study of Japanese economic capa.
bilitiee is now being undertaken jointly
by the two agencies. Conversations have
been begun looking toward joint handling of
air target objectives work in the future.
Attsebanit
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EXFCUTIVE D1FtECTO? R
1
Boum Oi MIMIC WHOM
DitiSIOMAMIODUCWO
WASHINGTON. D. C.
4
AUG 28
Brigadier General W. B. Smith.,
Secietary
Joint Chiefs of Staff
WashinGton, D. C.
bei_r General Smith:
7..cu ma.;? interested in the attached statements which
-ut:',ne the informal working agreement which has been
reaci..ed . etween the staff of our. Enemy Branch and the
Econo-dcr DivisioriM the Office of Strategic Services.
ane of th- e sttements is an informal a6reement in-
, itialled by Colonel Donovan and myielf; the other is a
summar=. cf two informal meetings held between people in.
the i.oard of Economip Warfare .and the Office of Strateg-
ic Services.
1
The
men' ,was
a&.,enc I ez.f.
flr
ar.t.i nc t
(
of .th,-se meetings, and of the informal agree-
4--) try .tc avoid duilication betweun"the two
, especig-ly in connection with the Work which is
Joint Itite11i6ence Committee.. It-Applies
te. work of t he Economics Division of ti OSS,
t an;,- .of the Geographic Divisions , agency.
Sincerely yours,
,e.
?j C,)
E)c.ecutive Director
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INFORMAL.AGREONENT WNW Tftt OuRKIAO
.STAFT6 or Tlik BRAMCM,
agf, AND The. 441.NOVICb
DtV1S100, OFFICL OF
inurzoic SILO ICU
As * result of eonvereations betimes the working :staffs of the.
Enemy Bransh, BMW, and the Iscupmics DiviBion, the following 4
points helve boon accepted as the guiding prinsiples for alloeations
.of.vork betimes the two genatlss-
1. of Faionomic warfare will attempt to-do a thorough
job in the field of *somas intelligens. from all souroes
available to its insluding eensorship and radio intereepts,
retureed travelers, reftigee., Amerioan business firms with
eonnestiOns abroad, the British Ministry of Econpais Mortar*,
ete.. ?hie intelligent,* data will be Available to the analysts
working for both the BEM and OBS.
2. Economic intelligence from espionage Bounties will be procured
entirely by 063; BE4 will not attempt to inter this field. Such
intelligence will be vied. available to the BM
3. The. will birrepponsibls for work on industrial objectives,
eakiag reoommendations to the intelligenee services of the Army
aid. Navy for the destruction of specific :industries, factories,
shipyards, transportation facilities and other economic instal-
lation' in enemy and enemy-ooeupied territory.
Suds reeommendations are based on detailed analysis of the
structure. and interrelationshof spesifie industries.,
ineluding
the no' of rev materials, somponent*, fuel, Power and finished
prodnets with i View to diesovering the bottle-neeks whose des-
truction would result in the most damag4 to the enemy's etionomy.,
4 The raw material?for mob analyais eonsiste primarily of data
turalehed by the BMW Noonomic Intelligens* Division, plus such
informatiom as may be avsilible trom-reseereh sourBest.fnd data ?
"made available by OBS from **anomie espionage.'
OBS will not enter the industftal Objectives field, ekeept for
evaluations of bonbing po4sly... Data prtpared.by BEN analysts
Workincen indumtrial objeatives will be suede freely available
.0615.
41.
4
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4 Both B.t.W and WS aro now bc,img aslied Upon for studies, in the
broad field of economic strategy, and estimate', of the enemy's
war potential: Suet% studies frequently are prepared under
-directives from the Joint Iniilligence Committee.
At the riKuert of the J.T.C., the two agencies mey prepare
. joint or separate rer)orts, as issw be 4esireble. cihen either
eoncy initiated ? major study, it will ooneult the other.,
H ?
In Irder to Make ouch consultation -close and effective, kV
will attempt to provide offioe ugnee for two or three 063 rowed.;
sentativis in Temporary 1, and OW Will attempt to provide
stiller facilities for BO people-in its offioe.
l?
5. The two agencies will attempt to work out an arrangement or
jofmt.reprosentatioo in London.
;
July 21, 1942
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LO **IO 1.M .11 ...X T11:1 Ac_
A dinner meeting wee held sedne*dai? 'venial. Aar 114 at Braoklagir
Institutionaftllowtag were preeents
rram 0.3.3.
idward 3. Kamm
? John D. %ilea.
Mune ?*spree
:handler Meree
Ares B.Z.V.
willies T. 360nO
John Pioche!
kLnfield Riefler
?Harlan Cleveland
Th. assaing was ealled in an effort to dialogue at the verldiag level; Ohat
0001001eL0 Jobs said to be dim for the armed services, and through What
fermi id organisation there Jobe ean be done most effectively. The taw.
mediate issue involved 1- the derree of overlap between CS3 and Irm In
the field of eoea*uie intelligence and analysis, sepeolally.in.the work
for the Joict Idefs,of Staff.
? ? jobs to be done fall quite readily into three trpris
i. Procurement of raw intelligence.
?
2. Preparative of itiasic reports covering ep.?ic industries to be
-used largely but not miclusively, in the eel.ctionj of specific economic
objeoptives for bonbing and other military or naval.ecti,,n. This involves
piecing together wraps of information from r...aih and intelligence
source, Into, a detailed analysis of the structure and intersrelationm
qrt of specific industries- - includin.- the flow of raw materials,
components, fuel, power, and finished products with n view to discr!-...
the bottlenecks Whose dostrucii-n would result in the most damage tc the
enemy's economy.
.conomic analysis on!the strating laved . estimates of
enemy economic strength in vafrious locrllospaymerall.comparieons of eco.
ootential, as bfetween the Axis and tn.. United Ncitionn, eto.
ArS.
'serk(ort.4, or Cliarkele, or the raw (Ho. 1) is ,7nnern ly
the, 4rolps porkinr on Nos. 21and lhp marlrets for the work on economic
lblectivfee 4one in lo, erei,Vou7.? no. and the intellicence sorvices
if the trmed forces ..2, 1,4..2, And r171. The market for the strntoric
gettnffltm# stmle under 'o. 7 ti the Joint 'Molts of An,ff, via thP Joint
!ntiqiigernoe -4mm-ittee.
4.1m. sev,itl areas of economic work in ehich D311 ond 13 d do not
ly4erlam ,t 4.1. "hem, &rot
.?
In th,..froIM If intellieende
) ond undercover woric (0S')
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(b) istalligemse from nonmallitary SOSPOSO (Ameriesee
? Watson ftraes semwerehip and radio isternepte, r? e.
turning travelers, ate.)
t ?
(o) military source* (e.g. anaiyeee of tartars' equip.
sent, istelligemoo from air r000nssieeesce), shied'
neither OW nor Bp are at present *US to tap to Mr
great astent.
In the?roolearah aad analysis field* .
(a)' qtrategio *Irma (iwi'y detailed work.** topography,
tranepot*, climetp, population, loading productesete)
(08s)
(b) 4Mplaty piobinne (detailed work for the 4siarteropeter
Arpe) ' ? (Ba)
? In %hi' field industrial ehjeotivet, BLW has done sore work this's 0514
the latter 'has mikem on work in this field only whoa eposifically rem.
quecit& to to an W the Aviv. -
"ne rad overlap oases in the third satecory Of work . the emelysie of
bro.0 luestions of economic otrategy, generally for tho J.U.C. Is this
field the cY.;=; ( Ammonia Avi.stos) has goats farther than the 8.410., and
nu'd a better staff. better to 'do' the analytical wort required.
basic preblem, therefiore, Is hoe the overlap In this field sea be ---
olisioated.
"here was gametal agreement that, 1.1a1137, Roe. 1, 2, and 3 should be
combined ander one tnnf. The questioa is *bother it is possible to amal.
eNmAte economic intellieence and analysis staffs of the tile organl'ations
ld att.' matot-rn the advantages that each organisation has, nom or is
stimant s. ? es asset
?ittVgiltriCeei
?
11) a gribd economic *naive., etsff
A close administrative rslatioaship with arm
Joint :hiefs of staff, which Kives
(a) A good market for its analytical work:
nnel.,:
? (b) "he prospect of being able to get is.
formAttnn from air reconnaissance and
other nilit:ary sourcei (better profmects
than.R.4 In this rognrds because is
aiholI7 civilian.)
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(I) kn intelligen( e c)rocurement staff alreaizr
well set up,
(2) A skeleton staff on economic objectives
(?) 'he recogaited Obsition of "o7,-Tosite ;umber"
to the T'ritigh Anistry of .:cOnoaxic rfare,
which is, useful both as 1-
( ) ?
A source of informetion,
on uropi.
.(b) nerkete for Tinished work.
(4) Independent st'otna and cruorsting functions
? in tia.nay 'related. eponortic MeV!: blockade,
'import oontrol, etc.
Tel the effort to el iming,te overlari ? r..4 combine these advtustrwee, there
are tie mltarnattve lines of ioti;nt
1. iV/110A of fametiont lie two organissttuls could remain es
they' Ake, with an effort to egzmrste their functions nnd thus ,void over.
1,4p. ?or es:aryl*, we oould ogre., that *as to stick to ?intellipwncet
;40curnmant and industrial objectives; rind thnt the %cone:mice Avision
o Was to oonfina itself to onelytionl,work for the JrC. lute nd..
sinistrativeli, this ul0 be a very difficult thin- to to. erflytio*
work ior't4* Jli.;.depende on the raw intellikencs, Rnd Rust be swiported
by tate piLLars of -facts built qp painstakingly bj the people working n
**Gnomic' objectives. If the analysts in 441,0d0 :So. 7 do not have a close
relationship to the oso 1(0.0 ..ohelons I rindiheir work won't reflrete.t
the bast work of the U. .i. ,-Awvernment on the problems of economic stritt...
(1-1,7. he ao. 1 analysts *net be able to direct the inrk of the other two .
*Onelons,? And Clat wou1d.4* vory difficult if they were not ell Ln the
?
'iota agency.
4k400y. If, for exassple? the 44monomics alvivion. of were transfoiCd7.
:10adammatiaa., *fl three edhalons?oculd be oombined in one
? to iA this might perhaps mean that the .toonomics wo%ld. lose its
dleartset" ,(the Joint :higrof Staff). and the possibility of getting
moonomio information from military sources. 71.41 transfer would not.
neogeearily mean this, but it might. %ether it did mean,it or not would ,
probob14 eiermod en the importenee, of the organisation relationship of
the &amnesties tvWn to the Joliti3...:hiefs of ';taff in comp/tri.ton with
ither f:aetors ?
;f. on the ether hand, the lmmicy Branch of were. to be absorbed by the ?
i.00nomIcs ;ivislom of rqip. difflaulttes would arise in Oonnection with
? itia-.-Lytat economic intelligempe to the other 9ranches of 11.7446 11'he 'question
Of Remaligamatioa thee requires cerefurstudy before concrete proposals onn
1
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he S41.??43[11-te' ,,cti.?,n plonk tr ;rte tr o'.11b1,
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ratyts, 000??
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3: inTor4.ent
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'etirlY1
-177: I f'
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? ler 14 ? ?: ) 7", 7' Cr Ti .t*s, a ,Iesk
f ft. Cie 3 , Tiff II' n,) n
he r?t4.. r. ; 11 aii jit L n 1 of centre"
'f* In 7-rInf:or,';. :,(.:ent'.or. ?
?%-r`;,grr ftt itrpttli .r (11,1Lner '1 1'1% .ve
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Planer was unable to at end;
nore added to the group.. Vr.
present. The diqourrion of
!t, drta 1.., bdt no nrw con.-
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September 1, 1942
1
MNILVAIS
FORt Dr. Baxter
FM Colonel Donovan
Here is a letter from the joint Chiefs of Staff
with the attached *informal agreement*
Will you Iodic at it and return it to me.
note in parairaph'-1 the statement that the BM
bmov radio intercepts as yell as general economic intel*
ligences Ilia" not teen any of this matealal. Would
rubel* whoever is your liaison man obtain that material
and see that I get ii41))k at it.
Would you make comments on the paper which you
could sate were you a member of the JPWC0
1
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x=cracurarxxximiccoxiccomoxic
cirms OP MOW= SZRVICIS
7t!
I ,;.7-777,
67.? !O. rsi
4-
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N4 let" 0.4
July 290 1942,
Ir. Valles T. Stone
Beard of loonamio Warfare
Washiwitoop D.C.
Droar Walt
I ham discussed with Colonel Donovan *and also with
MI Unger* who is the actin Head of the R and A Brawls, ix
ION Beaterss abestee, the semorenda c ottr root omraeroatiox
about ear infemall agroissat. AO* Langer wad C4osol. Dogma
wee -mak tbliO issaoral, Liss of 000poratioa proposed, and the
Colossi bas laiiisatod bis yillisismas to no to isittal either
or bath of the mom Ciaisillir Saris aad I aro lagriag a
soot4ag tbis attenboosk witk !maw Hamilton and :Moe Illomaaker
diatexem various quearti* israelyed ix the implexiattation of
thiswisporatioar? OP far se eau see ere euditt to be able to
mitt out a satisfsatory program*
Sizooroky yews,
frN,
Miwerd 134. Mom
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I have your memorandum about the informal agree.
sent If bich vas discvssed. in the recent meeting betveen
representatives of the Sconomics Division and the Board
of iconallic 'Mears:. I. think this is tuxdoubtedly the
best iou can do =1 I you3A approve,.
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I ti attachir., copy of an "infornal :r(;e:lent",
the 2ossibi1it,y of vii ':ch st s lisc,ssee
te
bet,iaeen re.)rt,sen-t.i.ti_ves ().: the cs n
Bo a-ti. or .cononic ' 1.101* h;1-; o2 t, rd I
have disclissedjTthoroughly with him. :soth 1,e '..nd t ink
that it v/ould be adv .sablo for -le to init3.al it/ L,o -r Li cr with
77i1.1i-,un Stone /e,,res,q--Li.ng the I should like to talk
with you about early next ..teelz.
-
1,63-tii
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IFU.H.:akti, Gar! I- 1,11: It). ;a
:ye ,ar.P.3 nm, :ALA! i.? . : .
1317, .,A0Tfl1P.,
ZIVIOUN,
3TRATZGICSEi.71CLS
.us a result of conversations betweon the working staffs of tlie
Eneny 3rauch, BM, and the hconwics livision, the follooing
points have been accepted as the g-stidin,; :ainciplf.a for allocation
work between the two agencies:
-
The aoard of Economic 7arfare will attempt to do a thorough
job in the field of economic .:..ntelligencc from ll sources
aviilable to it, including ccnsors1Lip ,Lnd rl.dio intercepts,
returnfid travelers, ref-ape.., :Jae:etc.?a ')usinese firms with
k-J.Jnnections abroad, the British Ministry of Economic 7arf_tre,
etc. This intellil.;enoe datrt. aill be audiab3.e to the analynts
worklag for both the HE- a;ad CV3.
Rconomic intelligence from ospionaL;c sources will be procured
entirely by OSS; nEw will not Atempt to ener this field. such
Intellige_xe will be made available to the Tr.
II
The BEti z?ll bo responsible fcrwork on industrial objectives,
Makilgetecommendations to the intellinnce earvices of the Arno7
-11tfor the destrucUon cf specific industxids, factories,
transportation facilities and other economic Instal-
lations, In enemy and enomp.o?upied territory,
$uch roommendations are based on detailed analysil of the
struetbre and inter-relations of specific industries, including
thft flON of raw materialsoliOmponents, fuel, )ower and finif,hed
products with a view to ',-.0Vering the bottle-necks whose Oes-
truction would result in most damage to the enemy's economy*
The raw material for snch snalyeis consists primarily of data
torniohod by the MI ECODOVIC Intelligencq Division, pins such
inforMation as may be available from research sources, and data .
nade available by 03$ from ecommic espi4nage.
O$ . vial not enter the industrial oblpottves field, except for
evaluagons of bombing pulicy4 Acta prepared by EV analysts
wookiftioli industrial Objectives will be made freely available
to, OSS.
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1
Both MI and 0$3 are now beint; called upon. for stIldics
broad field of ecOomic strategy, and estimates of the e.w. .y's
war potertial. Such studies freqpently are prepo00 urt:Ler
directives from the Joint Intelligence Committee.
At the request of the 3.I.0,01 the two a ;encies may prepcxr
joint or separate reports, as may be desirable. When eithu:
agency initiates a major study, it will consult the other.
In order to make audh consultation close and effective,
will attempt to provide office space for two or three CCS
representatives in Temporary TI and WS All attempt to
provide similar facilities for 110 people in its office.
The two alLencies will attempt to work out an arrorjement for
joint represelitation in Lon4m.
P./
'iv/Fe
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J"**
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3/09/17: CIA-RDP13X00001R000100040002-8
Declassified and Approved For Release 2013/09/17: CIA-RDP13X00001R000100040002-8
Declassified and Approved For Release 2013/09/17: CIA-RDP13X00001R000100040002-8
Declassified and Approved For Release 2013/09/17: CIA-RDP13X00001R000100040002-8
3/09/17: CIA-RDP13X00001R000100040002-8