CIA: OTHER SIDE OF THE STORY - - WHAT REDS ARE DOING

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CIA-RDP75-00149R000400510016-8
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May 4, 1967
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FOIAb3b Sanitized - Approved For Relea y X106 CONGRESSIONAL RECORD HOUSE [construction of the Soviet Fiat factory] .. announced plans are not so grandiose . . . if history is any any teacher, I see no in itself represents a sizable allocation of as to require a significant alteration in tradi- particular reason to view the present situa- resources for peaceful uses, but more will tional Soviet economic priorities, and would tion as a detente. . . . It is a question of follow to provide the roads, service stations, leave military and space program unimpaired, prudence in protecting the security interests la consumer needs is a heartening development in the Communist countries, one that we welcome and should support through trade' Those thoughts echo similar com- nlents offered by Acting Secretary of Commerce Trowbridge, who on Novem- ber 2,' 1966, as Assistant Secretary of Commerce for Domestic and Interna- tional Business, said: -he President's decision to provide for Export-Import bank financing of American machine tools and other products for the, Fiat automobile plant, 17n the U.S.S.R. Is a good example of how we will oiler our co- operation on projects. designed to improve the well-being of ' their people. We support their allocaton of resources to expand con- sumer-oriented industries? The International Trade Subcommit- tee report contains additional enlighten- ing information about the campaign un- derway to gain acceptance for the Fiat deal. It recites, for example, that last October, administration spokesmen sought to convince individual Members of the House, unidentified in the report, that "the Fiat deal would support the increased emphasis which the U.S.S.R. Is putting on using its resources to produce consumer good."' Such wishful thinking actually runs counter to findings contained in a Cen- tral Intelligence Agency report which the subcommittee itself included in its March 1 report. Claims that if the Soviet-Fiat factory is built it will cause the Soviets to invest extensively in tertiary automotive in- vestments-which means such items us roads, service stations, repair facilities and the like-are refuted by the CIA re- port which states: The USSR will almost certainly have no de- sire and little need to duplicate in the fore- seeable future the heavy tertiary investments that have been fostered by the automobile in Western Europe and the United States? The CIA report points out that the Soviet program is to produce cars for the Communist leaders, not the people. It states: Essentially, the new Soviet program is do- signed to produce automobiles for the bu- reaucratic and managerial elite, not for the average citizell10 Further. .re, it is the CIA evaluation that the r:.:ciounced Soviet plans to in- crease automotive production will not divert resources L.D n their defense or space programs: [Emphasis added.] 11 of this counry. There is little doubt that if the Soviets BASIC SOVIET PLANS REMAIN UNCHANGED were required to design and build ma- The leaders of the organization which chine tools and equipment which closely controls the Soviet industrial empire approximate those they seek from abroad traditionally have planned for the pro- in the Fiat deal then they would prob- duction of a relatively small number of ably have to use engineers, technicians passenger automobiles. That is still true and capital goods which otherwise could today of the current Soviet leaders. be employed in programs related to So- The current Soviet Communist Party viet military and space endeavors. I asked leaders approved of the plans. of the the Director of the Defense Intelligence State Planning Commission (GOSPLAN) Agency, Gen. John F. Carroll, about this which calls for the production of an and by letter of April 25, 1967, he re- estimated 230,000 passenger automobiles sponded: in 1967. The Central Intelligence Agency It is true that, if engineering and produc- estimates that over 12 percent of those tion resources were allocated to the design will be a Jeep-type vehicle, the GAZ 69.11 and fabrication of such machine tools and The CIA also estimates that 23 percent equipment, the resources would have to be of all Soviet passenger automobiles pro- taken from other programs, either miiitary or duced in 1967-a total of 54,000, will be civilian. In the past the Soviet Union has exported. Furthermore, according to the given priority to military programs over civil programs, and it is believed that-barring a CIF estimates, that figure will increase major change in Soviet policy-this practice to 250,000 automobiles exported by the will continue12 U.S.S.R.-by 19741? Significantly, 1974 Note that General Carroll confirms the year when the proposed Fiat plant is that the Soviets would have to divert re- scheduled to be in full production. sources from their other programs if ~ The ordinary Soviet citizens are today they were required to undertake the deprived of an automobile not because automotive project with their own of any action which they, or you, or I have taken. They are denied an auto- resources. mobile because Soviet leaders have de- In other words, to whatever extent creed that they not be permitted one. the United States or any other nation Everyone who gives serious thought to provides capital goods to the Soviets, the the workings of the Soviet Union under- Soviet leadership would be permitted to stands full well that the Soviet industrial continue its traditional practice of al- empire could right now, today, increase locating their own resources to military its output of commercial-type vehicles. programs. Neither General Carroll nor any other responsible official of U.S. intelligence agency . has ever, to my knowledge, claimed that there is evidence of a major change in Soviet policy. In other words, Soviet priorities in the Soviet in- dustrial empire continue to go to mili- tary programs. In spite of this we have witnessed a band of administration spokesmen, ap- parently ignoring evaluations of the in- telligence agencies, touring the country and giving the impression to the Amer- ican public, to trade, and business groups, and to communications media that the Soviet-Fiat deal will mean less Soviet tanks and more emphasis on consumer needs. SHIPMENT OF MACHINE TOOLS SHOULD BE DENIED I would like at this time to cite some reasons why in my opinion the Export- Import Bank credits and the machine tools should be denied the Soviets. DETENTE NONEXISTENT One rationale advanced by adminis- tration spokesmen for shipping and financing American machine tools to the Soviets is their claim in seeing in the present situation a detente. But that is a claim with little basis in fact. The high- est ranking member of this Nation's Armed Forces, General Wheeler, told all Americans last February 26: L Address .!'arch 2, 1967 by Anthony M. Solomon, Assistant Secretary of State for Economic Affairs, made before the Chicago Automobile Trade Show luncheon, Chicago, Illinois. ' Address November 2, 1966 by Alexander B. Trowbridge, then Assistant Secretary for Domestic and International Business, U.S. Department of Commerce, prepared for de- livery at the International Trade Session,. .lonal Foreign Trade Convention, New York City. The Fiat-Soviet Auto Plant, page 42. Ibid, page 26. 10Ibid, page 11. 11 Ibid. 11 Letter, April 25, 1967, Lt. General Joseph V. Carroll to Rep. Glenard P. Lipscomb. But even if American financial assist- - ance were granted and machine tools were exported to build the Soviet-Fiat plant, the CIA evaluation states: It seems certain that, within the next decade at least, the Soviet leadership not only has no plans to mass produce auto- mobiles in imitation of the West, but would strenously resist internal pressure to do so. Although the USSR may some day join the circle of nations that provide auto- mobiles for the average citizen, that day is not now in sight 10 In other words, the Communist leaders' plans for automobiles are basically to use them for rewarding the Soviet Com- munist Party elite and for exports and related purposes, not for the average citizen. The Communists' plans are designed to make the Communist Party more efficient in its communications and travel needs and better equipment to achieve its political goals. IMPORTANCE OF MACHINE TOOLS TO DEFENSE INDUSTRIES The following are some of the ma- chine tools desired by the Soviets for use in the Fiat-constructed plant in the U.S.S.R.: Numerically controlled ma- chines for diesinking; multispindle lathes; gear cutting machines; stamping presses; machines for mechanical opera- tions, such as transfer lines; boring, grinding, broaching machines; high pro- 13 "Moot the Press,". NBC television and radio program of February 26, 1967 with General Earl G. Wheeler as guest. 1' The Flat-Soviet Auto Plant, page 13. 15 Ibid, page 19. 10 Ibid, page 11. Sanitized - Approved For Release : CIA-RDP75-00149R000400510016-8 Sanitized - ADDroved For Release : CIA-RDP75- "-21M to asp gu sta tha March 7, 1967 CONGRESSIONAL RECORD - APPENDIX A 1103 The editorial concludes that "such facts are worth knowing when making decisions on foreign aid." Believing my colleagues will be interested, under unan- imous consent I place the editorial here- DEMOCRACY: WHAT IT MEANS TO ME Democracy is people-not an undefinable mass bound together, but unified individuals staying together. Democracy is a voice-appealing to the spirit of men-for no man can live on bread alone. Democracy is America-our past, our pres- ent, our future, earned by our own merits through sweat, toil, joy and tears. Democracy is people speaking to America. Often it is said ghat Democracy in the United States is almost invisible among the members of the "beat generation." Oh, on the contrary. It is the teenagers who will soon illuminate the flickering ember of what many people refer to as "dying Democracy." Just walk into a "Problems of Democracy" class and see the contempt with which the 18 year old I-A senior boys hold a draft dodger. Listen to a glee club singing "Ameri- ca our Heritage." Observe a girl scout troop's closing flag ceremony. Or listen to my words. You see we understand the challenge with which we are faced and we accept it. We realize the responsibility confronting us and we will not turn away from it because Democracy is our heritage. In the forthcoming decades it will be up to us to live up to this heritage and pass it on, perhaps even in better condition than we found it. In order to do this we have a tremendous task to perform. We must edu- cate ourselves, make our own decisions, stand on our own two feet. These are the most important things of all. It's too easy to turn into a second-rater, that is-seeing every- thing through somebody else's eyes. If we can prevent this then we have preserved the individual, and in a sense, Democracy, for the individual is the very cornerstone of Democracy. And then finally, Democracy is the un- definable terns-freedom. It is that certain exultation only those who bother to think and worry about will ever experience., In the lyrics of a modern day song: "Born Foreign aid is vital to the United States, apart from the humanitarian motives that also sustain it. Foreign aid is an established arm of na- tional policy. For 20 years, despite some objectors, every president and Congress have kept the program going. Self-interest alone would agree with Presi- dent Johnson's words: "In the long run, the wealthy nations cannot survive as islands of abundance in a world of hunger, sickness and despair." Those words come from the President's Feb. 9 message on foreign aid, in which he proposes fiscal 1966 programs requiring some- thing over $3.1 billion. AID (Agency for International Develop- ment) recently published figures showing that in 1966 it spent $604.5 million of for- eign assistance funds within the United States for commodities alone. Ohio was among the top six states in selling goods to AID. Its share was nearly $46 million, a very serious chunk of sales, wages and profits. Procurement from American sources makes up 90% of all AID spending for commodities, from powdered milk to earth movers.. Such facts are worth knowing when mak- ing decisions on foreign aid. Democracy: What It Mezns to Me EXTENSION OF REMARKS OF HON. WILLIAM V. ROTH OF DELAWARE IN THE HOUSE OF REPRESENTATIVES Tuesday, March 7, 1967 Mr. ROTH. Mr. Speaker, I would like to place in the RECORD for my colleagues' reading a speech written and delivered by Miss Diane F. Ambrose of Dover in the Delaware Voice of Democracy con- test sponsored by the Veterans of For- - eign Wars and its ladies auxiliary. More than 350,000 students from all parts of the country participated in the contest competing for the five top' prizes totaling $13,500, and today Diane is one of the finalists speaking here in Wash- ington. Even more important than the scholarships is the opportunity given these young people to address their countrymen and the world, telling is in their own words the meaning of democ- racy as they understand it. Much has been written and said about the "gen- eration gap," that seeming lack of com- munication between young and old. But, reading Diane's words, none of us, to whatever generation we belong, can fail to be moved and filled with renewed confidence in the future. Diane has made every Delawarean proud of her. I join with her parents, her friends and teachers, and with all the people of Delaware In wishing her success as she participates in the na- tional finals. The speech follows: free, as free as the wind blows, as free as the grass grows, born free to follow your heart. Stay free, while beauty surrounds you, the world still astounds you, each time you look at a star. Live free, when no wall's behind outing one man in charge of the CIA, the you, you're free as the roaring tide, so there's ? p,BI and all of the military intelligence no need to hide." services. This is what Democracy means to me-and The importance that the Soviet Union I hope-to you. places on front organizations is shown by this example: Alexandr Shelepin was a vice president of the International Union of Students when CIA: Other Side of the Story-What Red it was founded in 1946. He later became a vice president of the World Federation of Are Doing Democratic Youth, Shelepin then shot up to EXTENSION OF REMARKS OF HON. GLENARD P. LIPSCOMB OF CALIFORNIA IN THE HOUSE OF REPRESENTATIVES Tuesday, March 7, 1967 The article follows: CIA: OTHER SIDE OF THE STORY-WIIAT REDS ARE DOING One.ques'tion that keeps coining up in the latest controversy over the Central Intelli- gence Agency is this: Just whom or what is the CIA fighting? The answer is found in the other side of the CIA story-the facts on what the Com- munists are doing all over the world to pene- trate and grab control of organizations, underwrite treason and terrorism, stir up strife, stage revolutions, steal secrets. It Is the CIA's job to combat these activi- ties of the Reds in the cold-war struggle that has been going on in the back alleys of the world for snore than 20 years. From intelligence officials in the U.S. and abroad come authoritative accounts of what the CIA is fighting, how the Communists operate and reasons for such CIA programs as subsidization of work in the foreign field by some student, labor and other organi- zations. Disclosure of this financing brought the agency under fire, compromised some of its efforts and even led to demands that the CIA be abolished. Reds' use of fronts. As part of its plot to achieve world domination, Moscow-direceted Communism maneuvers through interna- tional front groups. Worldwide, U.S. Intelligence experts say, the Communists have 11 such organiza- tions-all under direct control of the KGB, the Soviet Committee for State Security, "operational headquarters" for Russia's whole cold-war scheme. These fronts are designed to appeal to almost every interest. There is a World Peace Council, and there are international fronts for labor, youth, women, students, teachers, scientists, lawyers, newspapermen, radio-TV workers and "resistance move- ments." The head of the KGB-who at this time is Nikolai Anisimovich Shchelokov-is one of the world's most powerful Communists be- cause his agency controls all of Russia's foreign and military intelligence as well as Soviet internal security. become head of the all-powerful KGB. He now is a top official of the Soviet Communist Party. Methods of operation. How do Commu- nist fronts operate? Here is one way: Fronts recruit young Africans, Asians and Latin Americans for training in Communist countries-as labor leaders or guerrilla fighters. The brightest are taught how to overthrow governments and set up Cosn- Mr. LIPSCOMB. Mr. Speaker, under crmunist ust young regimes. An ultimate aim is to re- leave to extend my remarks, I submit for A major Americans. objective of KGB, working inclusion in the RECORD an important through fronts, is to draw non-Communists article which appeared in the March 13, into unity with Communists. Such a drive 1967, issue of U.S. News & World Report now is on the upswing in Western Europe, entitled "CIA: Other Side of the Story- spearheaded by two of the groups, and the the World What Reds Are Doing." Federation Union of Students. I believe it is essential at this time that tional A former KGB official who defected to the there is it complete understanding of the West says that 80 per cent of Soviet person- serious, ruthless nature of the Commu- nel abroad are "trained professional spies." nist offensive and the tremendous job The KGB, this man says, rates the U.S. as CIA faces in this regard. This is what its No. 1 target and seeks to isolate America the article discusses and I believe it will from its allies on the theory that, when this be of interest to the Congress and the isolation is accomplished, the U.S. will public. "crumble from within." Sanitized - Approved For Release : CIA-RDP75-00149R000400510016-8 A.1.104 CONGRESSIONAL RECORD - APPENDIX March 7, 1967 The "unite and capture" theme runs bees of other Intelligence organizations- One of those groups-the Campaign for through all Communist-front efforts, such excels. But Venezuelan terrorists continue Nuclear Disarmament-mobilized strong op- al the World Youth Festivals that draw to get arms and money from the Commu- to position to ericans nuclear strategy Treaty thousands from all over the world. nists. Costs of these events are high. The Mos- One Communist faction in Venezuela re- Organization. The British Union of Stu- cow festival In 1957, for instance, Is osti- ccives weapons and training from Fidel dents is now the top target for Communist mated to have cost up to 150 million dollars. Castro's Cuba-where, only 90 miles from penetration. The Vienna affair in 1959 cost 50 million. U.S. shores, the KGB has a big stake. Cuba How Asia Is affected. In Asia, the World The Communist outlay on the youth festival is a transfer point for the Red paymasters Federation of Trade Unions has been the in Helsinki In 1962 was around 30 million. and spymasters in Latin America. principal transmission belt for Communist Another one is to take place next year in From the inside-. Throughout South orders. Sofia, Bulgaria-and the Russians already America, Communist "political action" The series of Communist insurrections are blaring propaganda against the Ameri- agents infiltrate student groups and labor which broke out over recent years in coun- can delegation because of the revelation that unions, whip up agitation among peasants try after country-Vietnam, Indonesia, In- CIA. money financed trips by some young and subsidize bandits. die, Burma and the Philippines-received Americans to previous festivals. Communists, Western intelligence sources the "go" signal from trade-union centers. Bonanza for the enemy, The "expos6" of say, control all but four of the national stu- Although the attempted Red revolution this CIA subsidy-which was carried out dent federations in Latin America-in all in Indonesia in 1965 was smashed, large under national policy established years ago- countries except Costa Rica, Bolivia, Chile numbers of Communists remain. Both Mos- is described by U.S. officials as a windfall for and perhaps Uruguay. The Communist- cow and Peking are trying again, U.S. in- the Communists. At earlier festivals, the front International Union of Students telligence officials believe, to rebuild for Americans-even though few of them knew claims, in fact, that 82 of the world's na- another revolt. that CIA money was helping to pay their tional student federations are affiliated with In the Philippines, where suppression of expenses-succeeded in blunting effects the It. the Huk uprising in the early 1950s Is Communists hoped to achieve. In the Middle East, the present Soviet ob- counted as one of the CIA's great, but largely c w U c icinls the bilclzeA victories the Communists p Communist funds also have financed travel by the Reds' American sympathizers-in- eluding students-to points behind the Iron Curtain and to Red Cuba. The KGB is said to have almost unlimited funds at its disposal-despite Russia's short- age of foreign exchange-and more man- power than the CIA, the FBI and U.S. mili- tary intelligence combined. One division of the KGB-the "Department of Disinforma- tion," or Department D-operates in the propaganda field. It plants false informa- tion, including forged documents, wherever an opportunity exists to smear and discredit the U.S. specifically and the West generally. In this, Department D gets help from such fronts as the World Peace Council, the World Federation of Trade Unions, the Interna- tional Union of Students and the World Federation of Democratic Youth. An illustration: The World Peace Council spread charges during the Korean conflict that the U.S. was using germ warfare. And two other fronts, the International Associa- tion of Democratic Lawyers and the World Federation of Scientific Workers, sent "in- vestigating commissions" to obtain "evi- dence" in support of the charge. What do Reds seek? What the Commu- nists are attempting to accomplish by under- cover methods in every country was made clear in a recent public statement by the chief espionage official in the Security Minis- try of Communist East Germany. He was talking about Germany, but he was enunci- ating the KGB line for all non-Communist countries. This top Red spy said: "To procure information and material is only one task of our organization. "The other and more important task Is to make use of the material and the knowledge gained for political purposes-to blackmail the enemy, to demoralize the population, and to make the Communist Party victorious in the whole of Germany." Like all spymasters in satellite states, the East German official is under KGB control. In every part of the world, secret Com- munist activity poses a threat. scene, 15 tO Stir up eliuugii t,rvuu+c w w++cawu z~sniu iii. l+y+++g o-a, +v.. ~...? . .-.~ .. ?-~ ?-_--? the stability of countries in which the U.S. A staff study just released by the U.S. has influence-particularly those where Senate's Internal Security Subcommittee Americans control big oil reserves. says this: Examples of the KGB at work in the Middle East include riots instigated by Com- munist agents in Jordan, massive supplies of arms to Syria, bombings in Saudi Arabia and floods of Communist propaganda pour- ing from Cairo, which is headquarters for a number of Communist fronts, such as the Afro-Asian Peoples' Solidarity Organization. Africa: Agents busy. In Africa, the Reds are trying to keep the whole continent in turmoil. Moscow and Red China bankroll opponents of President Jomo Kenyatta In Kenya. Com- munist Influence in Tanzania has grown to the point where the Government has under- taken to nationalize most private business, The Chinese Communists used their em- bassy in Burundi as a relay point for weap- ons and funds sent to rebels operating against the Congolese Government in Kinshasa. In the other Congo, of which Brazzaville is the capital, Communists-including Cu- bans-control the military forces. In Ghana, until they were thwarted by the coup that ousted Kwame Nkrumah, Soviet agents had penetrated the Government to the point where they controlled Nkrumah's personal army and were building a military base to be used for operations throughout West Africa. The Communists regularly supply weap- ons to rebels in Portuguese: Angola and Mo- zambique. In Somalia, the Army is equipped and influenced by the Communists. Soviet agents are fomenting trouble in Ethiopia. In Tunisia, Communist penetration is mainly through students. In Algeria, Soviet eco- nomic aid is a lever used by the KGB. North of Africa, in the Mediterranean area, a step-up of Communism's covert actions coincides with the growing Soviet rival presence. All along the fringe of the Medi- terranean, KGB men are busy. One piece of evidence: secret stockpiles of weapons, un- covered in Greece. Sometimes these activities are flushed into Communist-front efforts are paying off in the open, on one such occasion, in 1965, West Germany and elsewhere in Europe. Communist financial support for terrorists in In 1968, for the first time, West German Venezuela was exposed when three Rod non-Communist unions were persuaded to couriers carrying $330,000 in cash were send delegations to Poland, Czechoslovakia seized and jailed. and Russia. A British trade-union group Venezuelan officials said that the three- sent representatives to Russia. A Catholic two women and a man-were agents of the federation of trade unions in France was in- Italian Communist Party, which Moscow had duced to take joint action with the Cozn- assigned the job of smuggling money to munist-controlled French labor federation, guerrillas in Venezuela. Some of Britain's non-Communist organi- The Communist move failed in that in- zations have been heavily infiltrated by stance because of counterintelligence like Communists and used to promote Soviet that in which the CIA-according to mesa- propaganda against the U.S. Previous hearings have established that Moscow has, in the past, distributed vast sums, along with its directives, through various secret channels to support sub- versive activities in countries outside Russia, including the United States, and there is every reason to believe that this practice continues." The CIA's role. Countering Communist activities inside the U.S. is a task of the Federal Bureau of Investigation. It is the CIA which has the responsibility for combat- ting actions in the rest of the world which are inimical to the interests of this country. In carrying out that mission, the CIA must face enemies of many kinds-enemies masked as "do-gooders" as well as enemies trained In the dark arts of subversion, es- pionage, blackmail and assassination-all dedicated to the Communist aim once stated bluntly by Nikita Khrushchev and never denied by his successors: to "bury" the U.S. WHEN THE "COVES WAS BLOWN" A veteran U.S. intelligence official, dis- cussing public disclosure that CIA funds were being userl secretly to finance sonze American students at international confer- ences, said this: "The U.S., not just the severe defeat in this thing. "The U.S. still must fight to prevent the Communists from having all their own way in international meetings of students-or teachers, or scientists, journalists, labor unions, whatever. "But now that the CIA cover has been 'blown,' the job will cost much more. And it will take a long time before any U.S. orga- nization or group can regain the effectiveness that the National Student Association had. "These students were not instructed how to act, except in a very few cases. Main re- liance was on the American instincts and patriotism of almost all the students who were financially helped to attend. "The main arm of the Soviet Government's constant battle to discredit everything Amer- ican-Moscow's so-called 'Department of Disinformation'-has been sniping at the Na- tional Student Association for years. But it never was able to prove anything. "Now the Americans have given them the ammunition-perfect ammunition with which to fight any American delegation at any international meeting. The Americans have acted to 'devour our own children."' Sanitized - Approved For Release : CIA-RDP75-00149R000400510016-8