THE ECONOMICS OF NATIONAL SECURITY NATIONAL INTELLIGENCE (Sanitized)

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-00317A000200070001-9
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 81
• Document Creation Date: December 15, 2016
• Document Release Date: October 1, 2002
• Sequence Number: 1
• Publication Date: January 1, 1964
• Content Type: REGULATION

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STAT
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THEE 0 OMICS
of
NATIONAL SECURITY
NATIONAL
INTELLIGENCE
INDUSTRIAL COLLEGE OF THE ARMED FORCES
WASHINGTON, D.C.
1964
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INDUSTRIAL COLLEGE OF THE ARMED FORCES
WASHINGTON, D.C.
AUGUST SCHOMBURG, Lt. Gen., USA
Commandant
WILLIAM S. STEELE, Major Gen., USAF
Deputy Commandant
J. E. RHELER, Captain, USN
Director, Correspondence School
This material is furnished for instructional purposes only. The
views or opinions expressed or implied are not to be construed as rep-
resenting the official policies of the Department of Defense.
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FOREWORD
The expanding role of intelligence in support of those who formu-
late and execute national security policies of the United States is
abundantly evident today. For an alert and effective defense, indeed,
for its very survival, the Nation needs an adequate intelligence system.
This system must be able to provide an accurate picture of the world
as a whole, of the capabilities and intentions of potential enemies, and
of the chances of imminent attack by an aggressor. It must furnish
information on political, diplomatic, military, economic, and other
matters. And it must remain the servant of national policy, subject
to effective, continuing review and control by the government.
Many readers can still recall vividly the clandestine efforts of the
Office of Strategic Services in World War II, with agents operating be-
hind enemy lines and guerrilla leaders dropped into various countries.
Yet even then much work of less dramatic nature was also done to as-
semble and evaluate the masses of information vital to the conduct
of diplomacy or military operations. Intelligence today can draw on
electronic sensing devices, powerful high-speed cameras, advanced
computers,, and other highly sophisticated types of equipment. De-
spite these technological advances, intelligence is still a difficult process
of collection, analysis, evaluation, and synthesis of information. It
remains a job for well-trained, competent, experienced, and dedicated
professionals.
In an earlier era when the United States was more insulated from
events abroad, national policy decisions could safely be formulated
without the organization for intelligence developed since World War
II. Today intelligence on foreign countries, although hardly the
only consideration in policymaking, is one that in many instances over-
rides all others. The intentions, capabilities, and vulnerabilities of
foreign countries are becoming more and more relevant to U.S. courses
of action, and policy decisions affecting the Nation's security rest in-
creasingly on information provided through the machinery and proc-
esses of national intelligence described in the following pages.
M. S. RLEICIiLEY
Senior Educational Adviser
Industrial College of the Armed Forces
Washington, D.C.
1 April 1964
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CONTENTS
FOREWORD----------------------------------------------------
Page
lit
I. THE INTELLIGENCE COMMUNITY_____________________________
1
World War II Arrangements_________________________________
1
Postwar Structure-------------------------------------------
3
The National Security Council___________________________
3
The United States Intelligence Board______________________
5
Standing Committees of the USIB________________________
8
The Role of Intelligence in Policymaking______________________
9
II. THE INTELLIGENCE PROCESS________________________________
13
Requirements------------------------------------------------
13
Collection----------------------------------------------------
16
Information Processing______________________________________
21
Analysis----------------------------------------------------
21
Dissemination-------------------------------?----------------
25
III. CATEGORIES OF NATIONAL INTELLIGENCE----------------
27
The Strategic Estimate---------------------------------------
28
Defining the Problem_____________________________________
28
Strategic Stature________________________________________
30
Intentions and Capabilities_______________________________
30
Production Procedures___________________________________
32
Current-Intelligence Reports__________________________________
34
The Current-Intelligence Analyst__________________________
35
Past Failures of Current Intelligence_____________________
37
Indications Analysis_____________________________________
38
The Watch Committee and National Indications Center_____
39
Basic Surveys -----------------------------------------------
40
JANIS in World War II__________________________________
43
The National Intelligence Survey_________________________
43
IV. SUBJECT-MATTER SPECIALIZATION___________________________
45
Political Intelligence_________________________________________
45
Biographical Intelligence_____________________________________
47
Military Intelligence_________________________________________
48
Geographic Intelligence______________________________________
50
Scientific Intelligence________________________________________
51
Sources of Information___________________________________
52
Personnel------------------------------------------------
53
Analysis-------------------------------------------------
54
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IV. SUBJECT-MATTER SPECIALIZATION-Continued
Page
Economic Intelligence -----------------------------------------
55
Analysis of War Potential--------------------------------
55
Wartime Economic Intelligence---------------------------
60
Intelligence for Economic Warfare------------------------
62
Economic Intelligence in the Cold War---------------------
63
V. INTELLIGENCE IN THE SPACE AGE---------------------------
65
SUGGESTIONS FOR FURTHER READING----------------------
68
I:NDEX-----------------------------------------------------------
71
ILLUSTRATION
^Che Intelligence Community'--------------------------------------
9
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THE INTELLIGENCE COMMUNITY
Intelligence is collected and analyzed on many command echelons.
An infantry company in the field conducts scouting and other obser-
vational activities in its immediate area of operations. The command-
ing officers of battalions, regiments, divisions, and armies similarly
rely on intelligence-either developed by their own G-2's or received
from other echelons-to support them in the execution of their mis-
sions. There may at times be an unhappy duplication of activities by
the intelligence units in the hierarchy, but the desirability of giving
intelligence support to the operational commands at. all levels is not
seriously questioned.
Before World War II, the highest echelon of intelligence in the
United States was the departmental level. Military analyses were
produced by the War and Navy Departments and political analyses by
the State Department to assist, the respective Secretaries in the dis-
charge of their responsibilities. Estimates produced by, say, the War
Department did on occasion go beyond a mere review of military con-
siderations to take in other elements of the situation as well. For
the character of war in the 20th century and of the tensions between
wars called increasingly for assessments of military capabilities, not
in isolation but in conjunction with economic strengths, state of
scientific achievements, political intentions, and psychological vulner-
abilities. The War Department however, was then clearly giving its
views on matters in which other agencies might claim a greater com-
petence, and the presumptive departmental bias of its estimates tended
to vitiate their acceptability. There was no mechanism to provide
the President and those who assisted him in formulating national
policy with coordinated intelligence analyses on matters which tran-
scended the competence of a single department-in short, with national
intelligence.
World War IT struck home the urgent requirement for improved
intelligence support. to those who formulated national strategy. Pearl
Harbor was a, clear failure of intelligence. Despite the victory over
Japan, the stamp of the disaster remained indelible on the American
i
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2 THE INTELLIGENCE COMMUNITY
consciousness. The Hoover Commmission in 1955 observed, "The
CIA may well attribute its existence to the surprise attack on Pearl
Harbor."
Even before Pearl Harbor, the President took the initiative to
develop the machinery for producing national intelligence. In July
1941, the office of the Coordinator of Information was set up with
a charter to collect and analyze strategic intelligence and furnish the
results to the President and other agencies. The office was transformed
after Pearl Harbor into the Office of Strategic Services (OSS).
Strategic intelligence, pertaining as it does to the capabilities, vul-
nerabilities, and probable courses of action of foreign nations, covers
much the same ground as national intelligence in that both types are
commonly addressed to the top officials charged with formulating and
executing national policy. In the strictest sense of the term, however,
strategic intelligence can be conducted on the departmental or other
level without being offered, like national intelligence, as the coordi-
nated view of the intelligence community. Nevertheless OSS was a
lineal ancestor of CIA and so a landmark in the development of the
community for producing national intelligence. OSS made a lasting
impact by the stimulus it gave to the use of scholarly techniques in
intelligence analysis, although the popular literature has centered on
the organization's more dramatic "special operations," such as the
support of guerrilla activities behind enemy lines. OSS recruited
academicians by the hundreds, many of whom served as officials in
successor intelligence agencies and were among the first to articulate
a doctrine of intelligence to encompass the organization and activities
of the national-intelligence community.
OSS did not effect the interagency coordination required to dignify
its analyses with the designation of national intelligence. The syn-
thesis of intelligence during the war was rather centered in the Joint
Intelligence Committee (JIC) of the Joint Chiefs of Staff. OSS
was represented on the JIC along with the Department of State, the
Foreign Economic Administration, and the military services. It is
questionable whether even the centralized intelligence performed un-
der the JIC could strictly be called national intelligence, since its
purpose was to support, the requirements of the Joint Chiefs.
Joint collection groups, staffed by civilians and military officers, were
set up in the various military theaters. The joint effort was also
successful in bringing out a good compendium of data on terrain,
targets, population, and other items of basic intelligence in the JANIS
(Joint Army-Navy Intelligence Studies) compendiums. But no fully
effective mechanism was evolved for the production of composite in-
telligence estimates on such issues as the enemy's staying powers or
the need to bring the USSR into the war, and policymakers drew on
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individual or departmental analyses for background on these vital
issues of the day.
POSTWAR STRUCTURE
It was widely appreciated that the wartime intelligence structure
was makeshift, but there was widespread disagreement at the end of
the war on the best institutional arrangements for intelligence produc-
tion. In some quarters, there was advocacy of a single centralized
agency. Elsewhere, a centralized agency, which might increasingly
arrogate to itself activities traditionally performed by the intelligence
organizations within the military services, was viewed as endangering
the fulfillment of military missions. The nature of the compromise
finally evolved was foreshadowed in January 1946 when the President
issued an Executive order setting up a National Intelligence Au-
thority composed of the Secretaries of State, War, Navy, and the
President's personal representative. The National Intelligence Au-
thority served in the nature of a board of directors over a Central
Intelligence Group, which operated under two basic principles. First,
its mission was principally to coordinate the intelligence produced in
the various departments of the Government. Second, it was to per-
form only those other functions which the National Intelligence
Authority decided could best be performed centrally.
These two principles for the production of national intelligence
were retained by Congress when it passed the National Security Act
of 1947 creating the Central Intelligence Agency. Perhaps even more
important for the evolving shape of national intelligence was the
creation, under this act, of the National Security Council (NSC). In
the business world, there can be no sustained production of goods
for which there is no market demand. In the Government, similarly,
efficient services are not likely to be offered where there is no articu-
lated demand for those services. The NSC has played an historically
noteworthy role in making insistent demands on national intelligence,
and the intelligence community has steadily improved its skills in
tailoring its product to serve the needs of policymaking at the highest
echelons. This orientation of intelligence to the requirements of na-
tional policy has been further encouraged by the NSC's statutory
authority over intelligence production.
THE NATIONAL SECURITY COUNCIL
The President presides over the meetings of the NSC. The Na-
tional Security Act of 1947 (as later amended) prescribes four other
statutory members : the Vice President, the Secretary of State, the
Secretary of Defense, and the Director of Emergency Planning-
the last concerned with the mobilization and management of the
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Nation's resources in emergency situations. The statute permits the
attendance of such other officials as the President desires; the regu-
lar participation at Council meetings of the Secretary of the Treas-
ury and the Director of the Bureau of the Budget insures that matters
of national strategy are considered in the context of economic reali-
ties. In addition, the President on occasion invites other officials to
sit in on meetings if the agenda includes items in which they have
a special interest. Such ad hoe participants have included the Sec-
retary of Commerce, the Secretary of the Interior, the Ambassador
to the United Nations, and the Director of the U.S. Information
Agency.
The Special Assistant to the President for National Security
Affairs acts as executive officer for the NSC. A key figure in keep-
ing the White House abreast of national security problems, he pre-
pares the agenda of Council meetings and personally briefs the
President on NSC matters.
Two other officials participate in Council sessions: the Chairman
of the Joint Chiefs of Staff and the Director of Central Intelligence.
By statute, these are advisers rather than members of the Council.
They present their views in their areas of competence but do not join
in the final articulation of national policy recommendations.
The statutory function of the National Security Council is to
"advise the President with respect to the integration of domestic,
foreign, and military policies." The working style of Presidents
varies, and the role of the NSC has varied correspondingly from
administration to administration. President Truman did not regu-
larly attend meetings of the NSC: until the outbreak of the Korean
War. Under President Eisenhower, the NSC met; almost weekly,
and considerable reliance was placed on ;organs set up within the
NSC to prepare formal papers defining national policy positions and
to survey the implementation of. policy by. the executive agencies of
the Government.
These organs of the NSC were abolished under President Kennedy,
who called on the. Council as a group less frequently than did his
predecessors. In place of formal Council deliberations, task forces
on specific problems are now often used to provide the White House
with viewpoints that represent the consensus. of the participating
departments and agencies. The task force does not ordinarily come
within the NSC structure : The Berlin Task Force and the Counter-
insurgency Task Force are interagency groups that, are chaired by
State and report to the President through the Secretary of State.
An example of an interagency task force within the Council struc-
ture 'is the Executive Committee of the NSC, organized in the fall of
1962 for the Cuban crisis.
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THE INTELLIGENCE COMMUNITY 5
Insofar as the Council must obtain the information it needs to sup-
port its policy recommendations, the lawmakers considered it impor-
tant to give the NSC considerable authority over the national
intelligence process. The 1947 statute placed the Central Intelligence
Agency under the Council. Many of the responsibilities of CIA
and of other intelligence organizations are set forth in directives
issued by the NSC. The Council has also established intelligence
committees to coordinate certain activities within the intelligence
community.
THE U.S. INTELLIGENCE BOARD
The highest ranking of these committees is the U.S. Intelligence
Board (USIB). The USIB acts as a sort of board of review over
the intelligence community, meeting normally once a week, oftener
during crisis situations. The agendas of USIB meetings cover not
merely matters of substantive intelligence but also the general prob-
lems of administrative relationships within the intelligence commu-
nity. Since the heads of the various intelligence organizations are
on the Board, the understandings reached at USIB sessions are gen-
erally effective in achieving smoother working relationships on the
lower echelons.
There are six intelligence organizations represented on the USIB.
Central Intelligence Agency. The head of CIA is the Director of
Central Intelligence, but his responsibilities extend beyond the
Agency itself. He is the senior intelligence adviser to the President,
and he undertakes the coordination and guidance of "the total U.S.
foreign intelligence effort," in the words of a letter from the Presi-
dent of January 1962. Reflecting this larger role, the Director of
Central Intelligence, who formerly both presided as chairman of the
USIB and acted as the CIA member, now serves on the Board only
in the capacity of chairman. Since 1962, the practice has been for
the Deputy Director of Central Intelligence to sit on the U.S. Intel-
ligence Board as the representative of CIA.
While CIA's role in matters of intelligence interpretation is in
large part one of melding the estimates of other USIB agencies, it
also propounds its own viewpoints in the general effort to reach a
consensus. On Sino-Soviet bloc economic developments, for exam-
ple, CIA originates a large part of the contributions to stratt-gi(
estimates, and CIA viewpoints in this area tend to carry the weigl+.,
that the services carry in military intelligence and that other I SIB
agencies carry in their special fields of competence.
When the analyses of all these agencies are integrated i n CI 1