DIRECTOR'S PUBLIC SPEECHES

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CIA-RDP80M00165A002500040036-5
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RIPPUB
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K
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35
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December 20, 2016
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August 1, 2006
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36
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Publication Date: 
December 5, 1977
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MF
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i Approved For Release 2006/08/02: CIA-R DP80M00165A002500c - Executive Registry MEMORANDUM FOR: Director, NFAC STATINTL Robert R. Bowie SUBJECT . Director's Public Speeches During the past several months, Admiral Turner has spoken to government, business, and university audiences. In his remarks he has tried to increase public understanding of: . the continuing need for good intelligence; the difficult ethical and moral choices faced by intelligence agencies in their daily operations; the nature and probable effect of the reorganization; the checks and balances of the oversight process; the continuing and indispensable contri- bution of human intelligence; the high quality of the intelligence professional, and the evolving American model of intelligence. The two texts I have attached are transcripts of the Admiral's most recent speeches. They reflect the views he has expressed in most of his talks and I thought they would be of interest to you and your associates. Attachments: pproved For Rele4se 006/08/02 : C6(-R DP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A00250a43ber 1977 Secrecy and Morality in Intelligence When I came back to Washington from my overseas assignment nine months ago, I found myself confronted with what appeared to be a beleaguered CIA. Beleaguered by several years of criticism, investigation, and adverse publicity. Yet, as I grew to know the organization and the people I-realized how very fortunate I was to come to it at this particular time in our nation's history. I felt it was a?moment of opportunity. Opportunity first, because I doubt that anywhere else in the business world or in government will you find more dedicated, more capable public servants than in the Central Intelligence Agency and the other associated intelligence organizations in our country. They have an admirable record and, with this, I am confident that we have the foundation on which to rebuild public confidence which is much deserved. The second way it is a moment of opportunity is because today, out of the crucible of this period of investigation and inquiry we are forging a new model of intelligence - an American model of intelligence. The old, traditional model of intelligence remarkably unchanged over centuries of history, is one where intelligence organizations maintained maximum secrecy and operated with a minimum of supervisory control. Nearly all foreign intelligence organizations continue to follow this pattern. The new model we are forging is singularly tailored o the Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 outlook, the attitudes, and the standards of our country. On the one hand, it is open, more open just like our society. On the other hand, there is more supervision, more control, much like the checks and balances that characterize our entire governmental process. Let me explain a few of the cardinal features of this new American model of intelligence. First - Openness. Today we are attempting to share more with you, the public of the United States, than ever before. We are sharing first something about the process of intelligence, how we go about doing our work. Now, clearly we cannot share everything. Very often the reason information or how it was obtained is useful is because it is unsuspected by our potential adversaries. Publicity would vitiate its usefulness. But at the same time there is much about intelligence work that need not be kept secret and which I think both the Intelligence Community and the public would benefit by discussing openly. For example, contrary to popular belief, a very large percentage of our effort is not involved in clandestine spying. Most of our effort is concentrated on what would be termed on any university campus, or in many major corporations, simply as research. We have thousands of people whose task is to take bits of information that have been collected - sometimes openly, sometimes clandestinely - and, much like working on a jigsaw puzzle, piece them together to make them into a picture. With this picture they can then provide an evaluation or an Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 - 3 - estimate that will help our nation's decisionmakers better understand world events, anticipate problems, and make better decisions on behalf of you and me. This is a very ordinary but a very challenging task intellectually. It is no way spooky. Today, in carrying out our new policy of greater openness we want to share more of the results of this kind of analysis. Each time we complete a major intelligence study today, we look it over carefully to see if it can be declassified. Whatever its classification - Secret, Top Secret, or burn before reading we go through it and. excise those portions which must reamin classified. These are clues which in the hands of our enemies could jeopardize the way we acquired the information, or could endanger the life of someone who has helped us. . Once these clues are removed, if there. is enough substance left to be of interest and of value to the American public, we publish the study and make it available, usually through the Government Printing Office. You may have heard that in March the CIA issued a report-on the world energy prospects for the next 10 years or so. In May, a study was issued on the world steel outlook - available capacity, prospects for the future. In July, on behalf of the Joint Economic Committee of Congress, we issued one on the future prospects of the Soviet economy - a rather startling change from what had been predicted in the past. Also in July, we issued a study on International Terrorism which has subsequently been Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 made available through the Department of Commerce to businesses operating overseas. Now, not to exaggerate, the Intelligence Community has, of course, not been thrown open with all secrets revealed. Anyone with a cursory understanding of the international system appreciates that that would be very much to our disadvantage. Sources would evaporate, the advantage of knowing more about your adversary than he thinks you know would be lost, and a foreigner's loyalty to us would assuredly be rewarded with prison or death. But there are real advantages to opening up within the limits of necessary secrecy. Interestingly, I believe it is going to make it easier to protect important secrets. Winston Churchill once said, if everything is classified secret, nothing is secret. Today too much information is classified. There are also too many people running around who feel they can take it unto themselves to decide what should be classified and what should be released. They have released information which has done irreparable damage to our country. in terms of damaged national relationships; in terms of expensive, technical intelligence systems compromised; in terms of lives dedicated to America and what we stand for, lost. By our releasing as much information as we can, we can help improve the quality of national debate on important issues. And, in making that contribution we also derive a benefit. Greater public exposure of the Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 intelligence product, generates discussion and feedback to us of attitudes toward what we are doing and good constructive criticism of how-we are doing it. This is important not only because it decreases the likelihood of misunderstandings - and much of the criticism of the past derived from.misunderstandins - but-also, everyone of us in authority clearly recognizes that the intelligence mechanism of the United States must be operated. in ways that are compatible with the ethical and moral standard's of our country. The problem with that, however, is that it is not always easy to know with certainty what those standards are.. What the country would condone in intelligence operations or other governmental activities 20 years ago, it may conder^z today. How will the nation look 5, 10, or 20 years from now at what we are doing today? Unfortunately, we cannot launch a trial balloon. We can't take some proposed activity and test it out on 210 million or so Americans and expect it to remain secret. Often we either do something secretly.. or we just don't do it at all. That places a particular burden on all of us in the Intelligence Community. A burden to make difficult judgments as to what things we should and what things we should not do. The American model that I'm speaking of establishes controls to help us make these judgments. Let me discuss three of those controls. The first type of control is self-control, or self-regulation. For instance, today, and for some months, we have been attempting to write a specific code of operational ethics for the Intel ligenc_ Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 CIA-RDP80M00165A002500040036-5 6 Community. It hasn't 'been easy to write something that is specific enough to give genuine guidance, yet not so specific as to be totally inhibiting and prevent effectiveness. But to process of attempting to write such a code has been salutary for us. It has forced us to think more about ethical issues. It has forced us to grapple with the subtlties of these issues. Just as in business, just as in other agencies-of government, ethical issues are seldom all black or all white. But in examining the many shades of gray, we must ask ourselves exactly what are the boundaries of our societal standards? To what lengths should we go to obtain information which would be useful for the decisionmakers of our country? The answers are never clear cut. It would be easy for us to simply interpret standards arbitrarily and, stay right in the middle-of-the-road. Never 'doaziything that would embarrass the United States of America were it disclosed. Never treat people of another country differently than we would treat Americans. Be as open and fair in our dealings with other countries as we believe all peoples should be treated. Unquestionably ' this is how. we would hope we could act. However, in many situations they represent an unrealistic ideal. We must always remember, that we are an unusually blessed people, living in an unusually open society. In an open society like ours an outsider can come in and without great effort, using only open sources,a.ttain a good`-grasp of what's Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 CIA-RDP80M00165A002500040036-5 7 _ going on, what our basic purposes are, the directions we are going, and what we are thinking. He comes; he reads; he looks; he talks to people; he walks down the street; and he can easily make.an accurate appraisal of what the United States is about. Unfortunately, as we all know, there are closed societies in the world today. Closed societies where you can't go and walk down the street and talk to the people. And, reading the newspapers is'not very informative because they only say what the government puts in-.-them. Yet, we have a genuine need to know what'is going on in those societies. I don't think you would want your government to negotiate a new strategic arms limitation agreement with the Soviet Union if I could not assure you that we had some chance of feeling the pulse of the Soviet Union's political, economic, and military motives; if I didn'.t think there was a good chance of knowing whether or not they were abiding by the terms of such an agreement. The problem is not limited, to the military. Today we are in a economically interdependent world. What happens to the economies of the Soviet Union or the United States has ripple effects around the world. Yet, even here, closed societies of the communist bloc are not very informative. The pocketbooks of each one of us here is-exposed to dangers of the - economically unsound actions of other countries. We must have some intelligence capability for anticipating those events, for getting a.feel for the way foreign economies are moving. But Approved For Release 2006/08/02 : CIA-RDP80MO0165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5. this too is not easy. Nor is it clear cut how much of that information is of real value. Nor are the lengths to which we should go in acquiring that information well-defined. So, we must look to controls beyond the self-control which I have described. The second type of control over the Intelligence Community is in the form of laws and formal regulations. Congress has passed a number of laws that affect intelligence operations, like, for example, the law on wiretapping. This spring the Administration went to the Congress with a revision to this wiretapping law in an effort to better protect the right to privacy of American citizens and at the same time enable the government to obtain information that may be crucial to it. The President himself may issue very specific regulations. For example, there is a written regulation today prohibiting the Intelligence Community from counselling, planning, or carrying out an assassination. In the next session of Congress, our recent work with Congressional leaders will culminate in a series of charters being issued for intelligence agencies. All of the intelligence operations in the CIA, the Defense Department, and elsewhere in the government, will have a specific charter which will govern their operations. The third form of control under the American model of intelligence is called Oversight. Earlier I mentioned the impossibility of attempting full public oversight by ,launching trial balloons for every secret operation. While!we- really would Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 like to have full public oversight, it simply is not practical. The substitute that has been evolving is a surrogate process of public oversight. One of the surrogates for the American people is the President of the United States. Another is the Vice President. .Both these elected officials take a very keen interest in the intelligence process and operations: I see them both a regularly and they are fully aware of intelligence activities. Another surrogate is a committee called the Senate Select Committee on Intelligence which has been in existence for just over a year-and-a-half. This committee is in many respects a sounding board for us. We go to them with our problems and they feedback to us with what they feel the American people want. It is also a check on us. They hear things, they read things, they callus up, and ask us to come over and tell them what is happening and why it is_ happening. Through the budget process, I keep them informed of the full range of our activities. It is a very valuable line of communication between the intelligence agencies and the people of the United States. I am very pleased that in August the House of Representatives elected to establish a corresponding committee. Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 - 1.0 - I look forward to having the same point of contact, the same sounding board in the lower chamber, as we now have in the Seat-e. The Intelligence Oversight Board is still another oversight surrogate. This board is comprised of three distinguished citizens: former governor Scranton, former Senator Gore, and Tom Farmer of Washington, D. C., appointed by the President for the sole task of overseeing the legality and propriety of-what the Intelligence Community is doing. You, any of my employees, anyone who wants, may write to the Intelligence Oversight Poard, and say that_llow Turner is doing something wrong. If they think there's any illegality in intelligence operations or that something is being done improperly, they can go directly to this-'Board. The Board then makes its own investigation; they may call me. in and ask me what is going on; but they do it independently and report only to the President of the United States. He then decides if some action should be taken. Another form of control is over what is called covert action. Covert action is not gathering or analyzing intelligence, it is taking actions intended to influence opinions or events in other countries without those actions being attributed to the United States. The CIA has been charged by the President over many years as the only agency in the government that will conduct covert action and continues to be required to retain that capability. It is outside the normal ambit of intelligence activities and, as you can imagine involves a high element of risk. This is where the Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 CIA-RDP80M00165A002500040036-5 CIA has received the most adverse publicity. In the past, in Viet Nam for example, there was a good deal of covert activity being carried out. Today, covert activity is first, on a very, very, low scale; and second, before any covert effort is undertaken, it must be cleared by the National Security Council, the President must then indicate his approval by signature, and I must then notify eight committees of Congress. There are some who say that all of this oversight may be overkill. Let me be candid with you. There are risks in this process. There is the risk of timidity. The more oversight over an intelligence operation the less willing individuals are to take the risks that operation may entail. Maybe too few risks will be taken for the long term good of our country. When you sit around a conference table with other members of a committee, it is easy to say, no, that's too risky, let's not do it. It is much more difficult to stand alone in a group and say yes, for the long term needs of the country, we require that information, we should take that risk. The second risk is that there may be a security leak. As you proliferate the number of people with access to information about intelligence operations in order to conduct the oversight process, you run the risk of somebody saying something that he should not. In conclusion, you should know that I feel very confident that today we are beginning to find the balance between the risks of too much oversight on the one hand and necessary control on Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 12 - the other. There is every good prospect that a relatively stable balance can be established over these next 2 or 3 years as we shake down this process and as we mature into this new American model of intelligence. I believe we will develop ways of maintaining that necessary level of secrecy while at the same time conducting intelligence operations only in ways that will strengthen our open and free society. Thank you very much. I would be happy to entertain your questions. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02: CIA-RDP80M00165A002500040036-5 An American Model of Intelligence I appreciate your asking me to be with you to talk about what we are doing in the world of intelligence to serve you and to serve the country. President Carter directed a major effort to reshape the intel- ligence structure of this country back in February. After six months of scrunity, close study, and consideration of many alternatives, in August, the President issued several directives to change the way the Intelligence Community is organized. As a result of this, we are starting to evolve today toward a new model of intelligence e an American model. This American model contrasts with the old, traditional model where-intelligence organizations operated under a cloak of. maximum secrecy and with a minimun of .supervision. We hope today to develop a model which will conform to American standards of ethics and propriety and at the same time continue to provide senior decision .makers in government with the facts on which they can base sound decisions. On the one hand it will be more open as our society is more open; on the other hand it will be more controlled, with checks and balances much like those which characterize the rest of our governmental Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 process. I thought'itmight be of interest to you today if I discussed some of the actions we're taking to move toward this new model. The President's directive of last August had two fundamental objectives. The first was to strengthen control over our entire intelligence apparatus thereby encouraging greater effectiveness. The second objective was to assure control. through stringent oversight, thereby increasing accountability, Now let me point out that I am the Director of the Central Intelligence Agency, but this is only one of many intelligence agencies of the government. Intelligence activities also reside in the Department of Defense, in the Department of State, Treasury, the FBI, and even the new Department of Energy. But I am also the Director of Central Intelligence. In that capacity my task is to coordinate, to bring together into one effective, harmonious operation, the activities of all of those intelligence organizations. The President's reorganization strengthens my hand in that regard in two very specific ways. As the Director of Central Intelligence it gave me full authority over the budgets of all of the intelligence activities I've enumerated; and secondly, it gave me full authority to direct their tasking, that is, the day to day operations of these organizations. This should enable me to better Approved For Release 2006/08/02 : CIA-RDP80M00165AO02500040036-5 Approved For. Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 control the total effort of collecting, analyzing, .and producing intelligence. This is really what was intended, in my opinion, in the National Security Act of 1947 which first established the Central Intel- ligence Agency. Now some of the media have portrayed this as the potential creation of a intelligence czar. That interpretation could only come from a misunderstanding of the intelligence process itself. Let'me explain. Intelligence activities can be divided into two basic and separate functions. The first is collecting information. This is the costliest and the riskiest of our operations. It involves, among other things, reading foreign newspapers, intercepting broadcasts, trying to break codes, and recruiting individual in other countries to spy for us. Here you want good control. You want to be sure there is a minimum of overlap because each of these activities are time consuming and very costly; and you want to be sure there is a minimum possibility of a gap in what your collecting because that could be responsible for another Pearl Harbor. Only centralized control can ensure the intelligence collection effort is well coordinated. The second major activity of intelligence organization is analysis. It is exactly the same as Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 - Y Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 what would be called research on a college campus. It is the analyzing, the estimating, the pulling together all the little pieces of information that are obtained by the collectors and trying to put them together to produce a coherent picture of what another country is doing, or thinking, or planning. Hopefully this picture, or analysis, provides the decision-makers, the policy-makers of our country, a better basis upon which to make those decisions. Now let me make it clear, that under this new reorganization I do not control all the people who do these analyses. I do control those in the CIA; however, there is a strong analytic capability in the Department of Defense and another in the Department of State. The Department of State specializes in political analysis with second suit in economics. The Department of Defense specializes in military analysis with a second-suit in political. The CIA covers the waterfront. So we have assurance that-divergent views will come forward if they exist. We encourage that. It is in the interest of each of us in the Intelligence analysis business to be sure that the decision-makers don't .get just one point of view when several are justified. Our quest is to see to it that there is competitive, overlapping analyses. But, should I try to be a- czar; should I try to short-change the descenting or minority views, there is a Cabinet officer in the Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 -5? Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Department of Defense, and another in the Department of State who manage those intelligence analytic operations If I were to try to run roughshod over their views of events, I am sure those Cabinet officers would not fail to take advantage of the access they have to the President to ensure their views are brought forward. So we are not trying to set up a centralized control over the important interpretive process 'but over the collecting process. And,.I sincerely believe that this new organizational arrangement is .going to assure better performance in both collecting and interpreting intelligence for this country. The President, the Vice President, and many other of our top officials have spent much time working out this new reorganization. I believe this evidences the keen awareness throughout the top echelons of our government that good intelligence is perhaps more important to our country today than in any time since the creation of the Central Intelligence Agency thirty years ago. Thirty years ago we enjoyed absolute military superiority. Since-that time the failure of the Soviets to make their system grow adequately in areas other than the military has led them to accent that particu1 r competition. They have, I believe, achieved a position of reasonable parity in most areas of the Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08102 : CIA-RDP80MOO165AO02500040036-5 military. That parity places greater value on our intelligence product as an important adjunct of our military. When you know your enemies potential and something of his intentions, you can use your forces to much greater advantage. He doesn't normally reveal that information outright., but if we can pick up pieces of information here and there, over time you can bring those pieces together to tell you important things about your enemy. This gives your military commanders greater leverage in the use of their forces and the upper hand in any confrontation of their otherwise equal forces. Let's look past the military scene. Thirty years ago we were also a dominant and independent economic power. Today we are dependent on other countries in an economically interdependent world. This growing interdependence and the impact on our and other national economies on each other is more and more apparent. Here too, I believe, we desperately need good intelligence to make sure that we don't lose our shirt in the international economic arena. Politically, thirty years ago we were the dominant influence in the world.. Today even some of the most underdeveloped, emerging nations insist-on Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 a totally independent course of action. They go their own way and refuse to be directed to by the Soviets or ourselves. Here again, we must be smart. We must understand other nation's attitudes, cultural imperatives and outlooks so that we will not be outmaneuvered in the process. At the same time that we are trying to produce better intelligence in all three of these fields, we must be careful not to,undermine the principles on which our country was founded. or the standards by which we live in the process of so doing. Thus, the second leg. of the President'g'new policy is better oversight. The cornerstone of-all oversight is the keen and regular participation of both the President-and the-Vice President in the intelligence process. I can assure you they are both very much active participants. Beyond that there are two intelligence oversight committees in the Congress. The Senate Select Committee on Intelligence was formed a year and a half ago and has been working closely with the Intelligence Community. We have a relationship here of closeness but yet aloofness. Closeness in that I feel very free Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 in going to them for help and advice particularly when I'm involved with other committees of the Congress and there may be boundaries that are being encroached upon. But aloofness in that I very definitely report to them. When they call and want to know what we are doing and how we're doing it and why, I am answerable to them. It is a good oversight procedure and it is working well. The House of Representatives, last August, set up a corresponding committee. We are sure that that relationship will develop as has the one with the Senate. Beyond this the Intellligence Oversight Board oversees our activities. Three distinguished Americans, former Senator Gore, former Governor Scranton, and Mr. Thomas Farmer, a lawyer from Washington, are. appointed by the President, with their only task to oversee the legality and the propriety of our intelligence operations. They report only to the President. Anyone may go to them, bypassing me, and say look, that fellow Turner, or somebody else in the Intelligence Community is doing something he shouldn't be doing. The Board will look into it and let the President know whether they think corrective action is necessary, Approved For Release 2006/08/02 : CIA-RDFf80MOO165A002500040036-5 Approved For Release 2006/08/02: CIA-RDP80MOO165AO02500040036-5 Now let me be perfectly honest with you. There are risks to this or any oversight process. The first risk is that timidity may reduce the intelligence effort. It is easy when acting as overseer not to take a risk, not take a chance. But in so doing, we could fail to do things that could be very important to the long term benefit of our.country. It might place the avoidance of current risk over the gaining of long term benefits. The second risk is the risk of security leaks. The more you proliferate the number of people privy to secret. or sensitive intelligence operations, the more danger there is of some inadvertent leak. I am confident at this time that we are moving to establish -a healthy balance between the degree of oversight which will, ensure proper intelligence activity and the degree of secrecy by which permit necessary intelligence .operations to be protected. But it will be two or three years before we shake this process out and establish just how those relationships are going to function best. During that time, we are going to need the understanding and support of the Congress and that of course means the support and understanding of the American people. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Accordingly, we are now reappraising the traditional outlook toward secrecy, toward relationships with the public. We are adopting a policy of more openness, in.the hope that we can be more forthright at the same time as we ensure preservation of that secrecy which is absolutely fundamental. As a first step we've tried to be more accessible to the media. We have appeared on Good Morning America, 60 Minutes, Time magazine. Also we are trying to respond more candidly to inquiries from the media. We try to give substantive, meaningful answers whenever we can, within the limits of necessary secrecy. But perhaps of'more interest to those of you who are concerned with international affairs, we are trying today to share more of the product of the intelligence effort. More of the analyses, the estimates, the studies that we do. It is our policy to carefully examine every study we do, whether it is secret, top secret, or destroy before reading to determine if it can be reduced to unclassified form and still be useful to the public. If it can be done, we feel we have an obligation to print it and publish it. We are doing that to the maximum extent we can. We hope they will be of value and perhaps help improve the general. quality and tenor of debate on major issues effecting our country. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 You may have heard last March of our study on the world energy outlook. We have recently done another one on the world steel prospects - whether there is over-capacity; what the expected demand may be. We have published studies on the Chinese and Soviet energy prospects. And, under the egis of the Joint Economic Committee of Congress, last July we published one on the outlook for the Soviet economy itself. Let me describe that very briefly to give you the flavor of what we think we can put out in unclassified form. Previously, the CIA has looked at the Soviet economy and felt that generally it had the capability to achieve three things:- 1) to sustain the level of military growth that would permit them to catch up with us generally; to make improvements, if not spectacular improvements, in the quality of life inside the Soviet Union.; and 3) to sustain enough investment to carry on a generally growing economy. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Our most recent study reexamines these premises and comes to the conclusion that the outlook for the Soviet economy is bleaker today than at any time since the death of Stalin. This is based on our belief that the Soviets have maintained their levels of productivity over these many years primarily by infusing large quantities of labor and capitol. We believe they are coming to .a dead end, here. For example, in the 1960?s they had a very big drop in their birth rate. In the 1980's the rate of growth of their labor force will drop correspondingly from about 1.5% to about 0.5%. They will not be able to find the additional labor to keep up their productivity. Also, a lot of the growth of their labor force today is coming from the central Asian areas of the Soviet Union where there is serious resistance to the idea of migration to the big cities. Secondly, their resources are becoming more scarce. They must reach further into the Siberian wasteland for minerals. This is more difficult and more costly. Less petroleum can be brought in than before because their emphasis in recent years has been on current production at the expense of developing reserves and new supplies. Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08102 : CIA-RDP80M00165A002500040036-5 Now. if you look carefully at the Soviet's own' five year development plan, you will see that they themselves predict they will not be able to infuse the same amount of capitol or labor as they have in the past. However, they do conclude that somehow and nonetheless they will increase productivity. We don't think that is in the cards. We see no-sign of increasing efficiency, nor any sign of a willingness to become less shackled to the economic doctrines which are fundamental to their growth problem. Instead, we think that between now and the early 1980's the Soviets are going to be faced with some difficult pragmatic choices: (1) There may be a debate over the size or the amount of investment in their armed forces. Clearly, this is one avenue to find labor and capitol. (2) Another may be over whether they will continue to fulfill their promises for the delivery of oil to their Eastern European satellites. From exports of 1.6 Mbbl ~to E. Europe, they may have to reduce to something like 800,000 bbl. That would mean an increased oil bill for E. Europe of $6-7B/yr in probable 1983 prices. Will they be able to afford to do this when it becomes more and more difficult for them to obtain hard currency? Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 1CIA-RDP80M00165A002500040036-5 (3) And third, how will they obtain the necessary foreign exchange to sustain the rate of infusion of American and Western technology which they are currently depending upon to increase $ improve their economic position? The Soviet hard currency debt is $16B and E. Europe's is $24B. Both are rising rapidly.- an annual rate of $54B/yr. since 1973. Interestingly, when they face these and other decisions, there is a high probability that they will be in the midst of a major leadership change. It could be a very difficult time for them. It may go very smoothly if they made the right decisions-and are willing to sacrifice other things; we just can't tell. One of the important points that comes out of all this is that we believe as they make these policy decisions, it will not be remote from you and me, it will be important to us both. What they do with their armed forces obviously impacts on what we do with ours. What they do with their oil inputs to the Eastern European countries and whether that area remains politically stable is going to have major impact on the events throughout the European scene. If there is too much competition for energy because they don't produce what they need will affect the world supply and price of petroleum. If they enter the money markets in an attempt to borrow more from us and others in the West what will be our response? What will be our policy Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Now let me say that when we produce a study like this we are not so confident that we present it as the future revealed. We are merely providing our best reading of the clues we see. We expect others may disagree with us. But this too is productive. A good debate generates a good dialogue on important issues. When we did the oil study last March, for instance, it was criticized in the press. We then,wrote to the professors, the oil companies, to think-tanks which had critized our conclusions and we asked them to detail their criticisms for us. Those who did we invited to come into the Agency for a day of discussions with the authors of the study. A very interesting and stimulating dialogue resulted from which both sides benefited. We hope that as more of our studies come off the press, we will increase our dialogue with the public. However, let me assure you, while we're on this subject of openness that we cannot and we will not open up everything. There clearly must be some secrets which remain. Some of the information behind the Soviet oil and economic studies clearly was derived from very sensitive sources which would dry up if they were revealed. Thus, it is important to remember'that while we move ahead, increasing a public dialogue and trying to-build public understanding and respect for what we are doing, Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08102 : CIA-RDP80MOO165AO02500040036-5 we must also obtain the public's understanding that a level of secrecy must be preserved. In short, we're moving in two directions at once today. On one hand we are opening up more. But, in that process we expect to protect those secrets which remain better classified. When too much is classified it is not respected. The other direction we are moving is to tighten. the barriers of security around what must be kept secret. And in so doing, we are trying to develop a model of intelligence uniquely tailored to this country, which balances an increased emphasis on openness with a firmer resolves to preserve that which is truly secret. The model emphasizes the-continued necessity of providing good information to our policy-makers while at the same time responding to effective control. I am confident, that although this model is still evolving, it will guarantee that. necessary intel- ligence operations are carried out only in ways which will in the long run strengthen our open and free society. Thank you very much. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 MEMORANDUM FROM SUBJECT . Director's Public Speeches NFAC Robert R. Bowie Director, NFAC Room 7E44, Headquarters Bldg. Dr. Sayre Stevens Deputy Director, NFAC Room 7E44, Headquarters Bldg. I I Associate irector- Management Room 7E62, Headquarters Bldg. Richard Lehman Associate Director - Substantive Support Room 7E62, Headquarters Bldg. John Kerry King Director, Office of Regional & Political Analysis Room 6G00, Headquarters Bldg. Karl H. Weber Director, Office of Scientific Intelligence Room 6F20, Headquarters Bldg. James P. Lynch Director, Office of Geographic & Cartographic Research Room 1206, Ames Bldg. Harry C. Eisenbeiss Director, Office of Central Reference Room 2E60, Headquarters Bldg. I Chief, Current Reporting Group Room 7G25, Headquarters Bldg. Evans Hineman Director, Office of Weapons Intelligence Room 5F46, Headquarters Bldg. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Page -2- Maurice C. Ernst Director, Office of Economic Research Room 4F18, Headquarters Bldg. Noel E. Firth Analysis Director, Office of Image I I Room 3N109, Sidney N. Graybeal Director, Office of Strategic Research Room 3G00, Headquarters Bldg. STAT Chief, Publications & Presentations Group Room 7G00, Headquarters Bldg. Vincent J. Heyman Chief, CIA Operations Center Room 7F17, Headquarters Bldg. Anthony A. Lapham, General Counsel Office of General Counsel Room 7DO1, Headquarters Bldg. George L. Cary, Legislative Counsel Office of Legislative Counsel Room 7D49, Headquarters Bldg. John Waller, Inspector General Office of Inspector General Room 6E08, Headquarters Bldg. James H. Taylor, Comptroller Office of the Comptroller Room 4E42, Headquarters Bldg. Omega J. C. Ware, Jr. Director, Office of Equal Employment Opportunity Room 5E47, Headquarters Bldg. Herbert E. Hetu Asst. to Director for Public. Affairs Room 1F04, Headquarters Bldg. Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Page -3- Benjamin C. Evans Executive Secretary Executive Secretariat Room 7E13, Headquarters Bldg. John F. Blake Acting Deputy Director of Central Intelligence Room 7D6011, Headquarters Bldg. Michael J. Malanick Acting Deputy Director for Administration Room 7D24, Headquarters Bldg. Director, Office of Communications Room 2A03, D Thomas B. Yale Director, Office of Finance Room 1212, Key Building Clifford D. May Director, Office of Data Processing Room 2D00, Headquarters Bldg. James H. McDonald Director, Office of Logistics Room 2C02, Charles A. Bohrer Director, Office of Medical Services Room 1D4061, Headquarters Bldg. Fred W. M. Janney Director, Office of Personnel Room 5E58, Headquarters Bldg. Robert W. Gambino Director, Office of Security Room 4E60, Headquarters Bldg. Approved For Release 2006/08/02: CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Page -4- Harry E. Fitzwater Director, Office of Training Room 1026, Chamber of Commerce Bldg. DDS&T Leslie C. Dirks Deputy Director for Science and Technology Room 6E60, Headquarters Bldg. Edward M. Ryan Director, Office of SIGINT Operations Room 7B44, Headquarters Bldg. Philip K. Eckman Director, Office of Research and Development Room 606, Ames Bldg. Donald L. Haas Director, Office of Development & Engineering Room '6B00, Headquarters Bldg. John J. Hicks Director, National Photographic Interpretation Center Room 6N100, David S. Brandwein Director, Office of Technical Services Room 203, South Building Director, Foreign Broadcast Information Service Room 1013, Key Building William W. Wells Deputy Director for Operations Room 7E26, Headquarters Bldg. Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Approved For Release 2006/08/02 : CIA-RDP80MOO165AO02500040036-5 Page -5- Chief, Counter Intelligence Staff Room 2C43, Headquarters Bldg. Chief, Evaluation and Program Design Staff Room 2D32, Headquarters Bldg. Eloise Page Chief, Policy and Coordination Staff Room 2D48, Headquarters Bldg. William F. Donnelly Chief, Information Services Staff Room 1D4124, Headquarters Bldg. Room GH56, Headquarters B g. Chief, Career Management Staff Room 3C43, Headquarters Bldg. Room Headquarters BTdg- Room 2B1415, Headquarters Bldg. Chief, Africa Division Room 3B21, Headquarters Bldg. Chief, East Asia Division 5D00, Headquarters Bldg. I zie , European ivision 4B4405, Headquarters Bldg. Room 3C17, Headquarters Bldg. STAT Approved For Release 2006/08/02 CIA-RDP80MOO165AO02500040036-5 Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5 Page -6- Chief, Near East & South Asia Division 6D3107, Headquarters Bldg. Chief, Soviet East European Division Room 5B4803, Headquarters Bldg. Tnier, Latin America Division Room 3C2019, Headquarters Bldg. Room 912, Key Building DDO PANEL Room 3B2606, Headquarters Bldg. Room 2B44, Headquarters Bldg. I I eadquarters Bldg. I oom eadquarters Bldg. Room 3B2631, Headquarters Bldg. I Dorn a Headquarters Bldg. Room 3C29, Headquarters Bldg. Room 5C32, Headquarters Bldg. STAT STAT STAT. ST-AT- Approved For Release 2006/08/02 : CIA-RDP80M00165A002500040036-5