DEPUTY DIRECTOR, JOHN MCMAHON SPEECH AT THE 544TH STRATEGIC INTELLIGENCE WING AT OFFUTT AFB OFFICERS CLUB OMAHA, NEBRASKA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP88B00443R000903670004-6
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 8
• Document Creation Date: December 22, 2016
• Document Release Date: May 12, 2011
• Sequence Number: 4
• Publication Date: October 8, 1983
• Content Type: MISC

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Deputy Director, John McMahon
PraU x x \,\
Speech at the 544th Strategic Intelligence Wing
Omaha, Nebraska
October 8, 1983
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JOHN MCMAHON: Colonel Delaney and members of the 544th,
I'm delighted with the opportunity to share this evening with
you. I would also like to acknowledge General Doyle, who's made
my visit very unique, very successful....
Anyone who visits Omaha and Offutt Air Force Base has to
be moved. They have to be moved by the obvious dedication and
competence which just exudes in this organization. My visit
through the 544th Strategic Intelligence Wing yesterday and
today, the briefings by the intelligence staff were an experience
that I think every American ought to have the honor and the
privilege to behold. And one has to come away feeling that i.f
the strategic well-being of the United States -is i.n someone's
hand, we ought to be very grateful that it is yours. That is
certainly the feeling that I perceive and reflect tonight.
A few weeks ago I had the opportunity to have a dinner
partner. Ann Chennault, the wife of the former Air Force General
of the famous Flying Tigers. She?.rese to spoke and reflected a
motto that I think every speaker ought to bear in mind. She
said, "Speeches ought to be like miniskirts: long enough to
cover the subject, yet short enough to be interesting."
[Laughter]
Before I go much further in thanking you for sharing
this evening tonight, I would also like to thank the Madam and
Mr. Vice for a fabulous performance.
[Applause]
There's no need to talk to you tonight about the Soviet
threat. You live that 24 hours a day every day of your life.
Our purpose in the intelligence world is to try anc make sure
that we can provide for you people all you need to make sure that
the Strategic Air Command does everything it needs.
Unfortunately, during the 1970s, some folks In Washing-
ton thought otherwise. During that decade, the intelligence
community lost 40 percent of their funds and 50 percent of thpir
people. In the past three fiscal years, we have been on the
rebuild. And that'-s fortunate. for the United States.. The
intelligence community has enjoyed these past three years a 18
percent increase in the funds. While the people remained
re a ively constan, we can excuse some of that because of the
beauty of automation, remote sites, and what have you.
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But the health of the intelligence community is being
restored. And I hope that is reflected in the intelligence which
is flowing out here to Omaha.
If you look around, the demands on intelligence are
awesome. It was rather easy right after World War II when we put
a simple man-to-man' defense against the Soviets as they tried to
move into Western Europe. Our mission was a simple one: just to
counter the Soviets and give the Marshall Plan an opportunity to
take hold. And I think history will bear out that we were
successful in doing that.
But in- the e-arl-y '50s-we began to-realize the Soviets
were up to something else. A great deal was going on behind that
Iron Curtain that we knew nothing about.
In 1953 President Eisenhower began to panic because we
were putting very little information before him on what the
Soviets were up to. In fact, the only photography we had was the
?pho.toaraphy captured from Germans in World War 11. And President
Eisenhower convened a panel of academicians, industrial experts
from across the country, headed by'bit Land of-Polaroid Camera,
and he. asked this panel for advice on what should be done and
what could be done.
The outgrowth of that panel recommendation was the U-2.
And fortunate for us, we had an individual like Kelly Johnson at
Lockheed with the concept of the "Skunk Works," who took the U-2
eii'cra.ft from drawing board to first flight in nine months, and a
year later we were overflying the Soviet Union. From that day
began a whole different dimension in intelligence. The technical
intelligence then began to dominate.
Of course, as you all appreciate, we moved rapidly into
[unintelligible] and also with more advanced intelligence
systems.
The Soviets did not relent at all. They began to put
tremendous resources into the building of their strategic forces
under Khrushchev. When Brezhnev came along, he realized that the
Soviets :had built a very impressive strategic nuclear arsenal,
but had very little conventional capability. And Brezhnev put a
great deal -of effort into conventional forces.. And now, under
Andropov, that continues. And the Soviets, indeed, have built a
very formidable force.
Today they spend the equivalent of about 14 percent of
their gross national product on defense, exceeding the U.S. by
twice as much as what the U.S. invests. And they don't seem to
stop at all. While we see an [unintelligible] out on that curve,
there's still a?fantastic amount of funds flowing into their
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But now that the strategic balance, so to speak, in the
Soviet mind, has been achieved, that has given them great
opportunity to reach out, with their support of their conven-
tional forces. And indeed, we see them doing that.
Ten years ago we could point to some 25 countries under
the influence of the Soviet Union, one wa~tvo ggr the other. Tonight
that number is 50. We see them in PidiJ (?) and in Ethiopia,
which makes an excellent choke point for the Suez Canal. We see
them in Vietnam, which takes the other end of the Indian Ocean.
We see them, through the Libyans, causing trouble with the
Polisario.in Morocco, which threaten the Gulf of Gibraltar, or
the Straits of Gibraltar:_ And, -&f course, in' Cuba and Managua,
we obviously see the threat to the Panama Canal.
Beer in mind that some three-quarters of U.S. trade
moves through the Caribbean and Panama Canal.
And now other things have happened in the world which
really plays into the Soviets' hand. The lesser-developed
countries, as we kindly call them today, have amassed a deb-16 of
$625 billion. Last year those same countries could not pay Pffip si n Brest of $140 billion. And any country that i?s trying
to grow then must look for greater credits or financing. And, of
course, all the world banks withdraw from that. And as they
withdraw, they can't produce. And as they can't produce, they
can't get more money. And hence that's not a very pleasant
picture to behold.
And then you begin to get political unrest and uneasi-
ness. And, of course, *that's fair game for the Soviets to move
in and exacerbate the stability of those countries.
So, we have a great deal before us just to keep track of
what is happening economically in the world, and-provide that
information to our policymakers so that they can take whatever
measures possible to counter that.
And, of course, when you talk economics you also have to
talk about the oil situation. And what is happening there? You
see it already in the Persian Gulf, not only from the Iran-Iraq
war, ?what that's done to the flow of the oil, but the? fact that
the Saudis today experience, if you can believe it, a cash-flow
problem. The Soviets have exten -- or, the Saudis have extended
so much development throughout the other Arab nations that they
now have to withdraw-from, that those Arab nations are losing
their growth. Countries such as Egypt,-that had $2 billion worth
of foreign exchange from the people that they've sent overseas to
help the Saudis in those development efforts, are now coming back
home, joining the unemployment lines. And, of course, that
balance of payment worsens for Egypt.
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So, all over the world, we have this very unsettling
picture of economics.
..And when you think economics you also have to think of
the civil technologies that is growing in places like Europe and
Japan. And we find that our friends are more a threat to us than
our enemies. The United States have owned markets for years
around the world that we are now losing. What will the trade be
like ten years from now, when the Japanese not only compete with
us in the electronic chips, but also in computers? How many
Detroits can the United States suffer?
The Japanese _already put us on notice that they're
coming after us in our computers; and indeed they are. Fujitsu
and Hitachi have developed computers comparable to our Cray, a
super computer.
The West Europeans also can compete with us electroni-
cally. They have a different way of life than we do. We take a
.company in the United States, and under the good old capitalistic
system, we say, "Go sic 'em." They compete with each other. And
they go over to Europe and to Japan, and they don't deal with
another company; they deal with a government.
When IBM wants to talk computers in Japan, they talk to
the Japanese government. When the French decided that they were
going to take on Boeing with the Airbus, they put $1.2 billion
into the development of the Airbus. They put $1.3 billion into
marketing. And they put $400 million a year into subsidies. And
then .they turn around and use Elysee and their diplomatic
leverage to pressure countries that went to deal with France to
buy the Airbus in lieu of the Boeing aircraft.
The United States ?government cannot sit idly.by, with
its present laws and arrangement, and allow that to happen
without bringing the muscle of the government to beer on that.
The computer industry alone, in the 1900s, will be a
$300-billion-a-year business, And we can't let that get away
from us. And we can't let the aircraft industry get away from us
either..
Al., of this burden seems to fall on-the intelligence
community to try and raise the alarm, so to speak, as to what is
h.appening in the world and what is happening to these technolo-
gies in these various countries.
And you look at technologies and you come'upon one of my
favorite sports, and that's technology transfer, where we
virtually give away to the Soviet Union just about all the
technologies we have. And what we don't give, they're able to
steal.
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The Soviets had the plans to the C-5A before it flew.
They.have plans to our Minuteman, our nuclear weapons. The laser
range-finder in their tanks comes from the United States. Their
computers are IBM computers. Their production line for micro-
chips come from the United States.
The Soviet Union and their surrogates have 30 companies
right here in this country who enjoy all the privileges end
protection by law of U.S. persons. They're able to trade with
U.S. companies and get those high technologies from those
companies that produce it. And our laws only go to export. And,
of course, the export laws between here and Canada are negligi-
ble. So-the Soviets have dummy firms in Canada, flow the stuff
up to Canada, and then' ovt to the' Soviet 'Union. -
Their radars, their look-down, shoot--down radars are
ours. When we first intercepted the AWACS [unintelligible] IL-76
it had the parameters of our radar. And indeed it ought to,
because it was.
We see this as the highest priority of the KGB in the
United States. They are doing wonders in steeling them. And
w.hat they don't steal that way they steal through our subsid-
iaries in Europe, plus-the 300 companies that the Soviets own in
Europe where they also get access to that technology.
And what does it mean to you? It means that you have to
fight your own weapon systems. It means that we need a $247
billion defense budget just to stay even with ourself.
And some day we'll have to choke all of that off and to
stop that. '
And then when we-can stop worrying about such things as
the military might of the Soviet Union or what is happening
economically, we have such odd little things as terrorism, which
unfortunately is a growth industry throughout the world. But
what is different this-past year is that it's being focused on
Americans because they're Americans. Americans`wor4dwide are
being targeted. In times past, it was the American businessman
who was kidnapped because he was the banker. When a terrorist
organization ran out of funds, they turned to the local American
businessman, kidnapped him, and got their fiscal funding for the
next year. In the last seven or eight years, U.S.* businesses
have coughed up $125 million 'in ransom money to get their
executives back.
But now the terrorist organizations are-forgetting' that
and they're simply blowing up Americans because they're Ameri-
cans. And our task is not only to thwart that and find it out,
but to neutralize it. Not an easy one.
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And in the United States itself, we have the tremendous
flow of narcotics from overseas. It's a $100-billion-a-year
business in the United States. There is so much money, that when
you cut, off one trafficker or one route, there's ten to take
their places.
And what we want to focus on is not the trafficker or
the Mafioso that's pushing it, and try to figure out how do they.
clean that money up. How does that $100 billion get laundered
and end up in the churches and shopping centers and apartment
buildings and condos in the United States? That is happening.
So we want to try to unearth how that transaction takes place
[inaudible].
I can say that, from my experience, I'm quite content
that intelligence is here to stay. The demands a-re awesome. We
have, I think,a Washington today that is eager consumers of
intelligence,-and they know how to use it. I've never found a
requirement erased. They just keep adding to it. And our job is
trying to organize those [unintelligible] to respond to as many
as possible.
Fortunately, we have a President that is eager to have a
strong intelligence community. We have a Congress that is very
?supportive. And I say that with one exception. That realy, when
the rebuild of the intelligence community started in fiscal-'80,
it was Congress that overrode the President to put funds back
into the intelligence program,?including people. And they fenced
the money so it could only be used for intelligence, because they
had realized, through their actions, they had almost decimated
the intelligence organizations of the United States. And out of
good conscience and *the fact that the American people were
becoming very uneasy, it's starting to flow back.
And with the advent of President Reagan, who just picked
up on Congress, and so we are doing well.
The oversight that we have enjoyed from the Senate has
been most responsible and most balanced. The Hoilse Was a super
House until this spring when they split over partisan lines over
Nicaragua and the agencies involved in Nicaragua. And that split
was pure partisan politics.
But one thing that was interesting -- and all of you
should realize this -- that had we not had those intelligence
communities, CIA would have been hung out to dry like it was in
1974 and '75. But the fact that those two committees of Congress
are knowledgeable of everything we do, they were there for the
takeoff and they -knew they had to be there for the landing. And
suddenly the war-quieted down.
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Now, I'm quite prepared to have Congress have differ-
ences over the policies of the United States. Whether they want
to tyke issue with the President on those policies is their
prerogative. But what they should not:do is, one, accuse the
agency of breaking the law, which it did not do; or, two, raise
the example that, quote, other members of Congress think that the
agency is breaking the law.
Two things have happened. The summer rest, I believe,
has begun to turn the House around. And also, the Korean airline
incident has sobered up those members of Congress to realize what
we're dealing with when we talk Soviet.
The Soviet may wear Western clothes, he may look
Western, and he may eat Western food, but don't you think for one
minute that they think like you and I. Don't you think that they
negotiate like you and I. There isn't an honest bone in their
body, and never has been.
[Applause)
The Soviets never enjoyeb*the pleasor?e, the honor, or
the suppression of the. Roman Empire, or the culture that flowed
from that. They never enjoyed the culture of the Orient. They
were stuck in between and suffered close to 300 years of Mongol
rule, which was pure devastation and harshness. And that
permeates their bodies and permeates their thinking. And they
will only agree if there's something in it for them at the and..
. When the Soviets shot down the airplane and then
proceeded to lie and ?li.e, even changing their lies, and keeping
it up, I remarked to my wife, "How can they be like that when the
whole world'knows teh difference?"
And she quoted for me a saying that said, "The Russian,
great and small, will lie or breach a promise to achieve his end.
That a Russian neither. believeth what anyone says nor speaketh
That quote came from Sir Giles Fletcher, who was the
British Ambassador to the Court of Fedor (?), son of Ivan the
Terrible, in 1588. And in 400 years, they haven't changed their
colors.
And that is why, Officers of the 544th, I'm grateful to
folks like you. Keep it up.
Good night.
[Applause]
4--
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