Foreign Relations of the United States, 1945–1950, Emergence of the Intelligence Establishment

81. Memorandum From the Assistant Secretary of State for Administration (Russell) to Secretary of State Byrnes⁰

Washington, November 3, 1945.

I have reviewed with considerable interest the Report submitted by the Bureau of the Budget to the President on the Organization of Intelligence Activities in the Government.¹ I find myself in general agreement with the conclusions reached in the Report.

It should be noted at the outset that this Report primarily directs itself to the creation of a general over-all intelligence set-up, combining and coordinating the intelligence activities of all interested departments. Its conclusions, though, can be applied with equal logic to the intelligence operations of a single department. The principles of organization are sound and should be applied by the Departments themselves in their own set-ups.

In my judgment, the fundamental point made by the Budget and reiterated time and again throughout its Report is incorporated in #2, Summary of Conclusions, appearing at the bottom of page 2 and at the top of page 3, of the letter of transmittal to the President.² It is as follows:

“The principal intelligence operations of the Government should be organized at the point where decision is made or action taken, i.e., at the departmental, or lower, level and not within any single central agency. Each department (or subdivision of a department) which has important responsibilities in international matters or which has responsibilities for providing the public with information about foreign countries should provide for a competent foreign intelligence operation.”

Again, on page 9, the Report itself puts it:

“The intelligence needed to assist wise decisions and support informed action must produce a knowledge and understanding of all the factors involved. Further, it must be at hand. Extreme centralization of the intelligence operation is no more workable than would be the centralizing in one agency of the job of producing all statistics for the Government. The intelligence operation is handmaiden to the action-taking and policy-determining groups. It must be sensitive to their needs.… A department which will be held responsible for its decisions and actions must in turn be able to hold accountable to it the operation which produces intelligence on which those decisions and actions will, in part, be based.

“The principal foreign intelligence operations of the Government therefore should be viewed as being organized at all places where decisions are made and action taken, namely at the departmental, or lower, level.”

Speaking particularly to the continuance of a large central organization such as OSS, the Report on page 12 deprecates the tendency “to conclude that what is needed is the continuation on a permanent basis of some such large scale central operation as exists now in the Office of Strategic Services. Such a conclusion fails to take into account the fact that the principal intelligence operations of the Government must be organized at the point where decision is made.”

Translating these principles, the validity of which can hardly be questioned, into the organizational set-up of the State Department, the decision must be made as to where the level of operations is in the Department or, to use the language of the Budget, “the point when decision is made or action taken, i.e., at the departmental, or lower, level and not within any single central agency.” This obviously does not mean the Secretary or Under Secretary. So to conclude would mean that these officials would be completely immersed under a blanket of operating decisions, many of a comparatively trivial character. To paraphrase the Budget Report, there might be some justification for such extreme centralization if “all policy and action affecting our foreign relations” were centered at the level of the Secretary and Under Secretary. But that isn’t the fact and can never be the fact. The point of centralization, it would seem, would be the geographic desks, which should function, in my opinion, directly under the Secretary and Under Secretary. These desks represent the level of operations. They must take certainly the initial responsibility for suggesting decisions and actions to the Secretary and Under Secretary. If that be true, they must “in turn be able to hold accountable to it the operation which produces intelligence in which those decisions and actions will, in part, be based.” It accordingly follows that, except as hereinafter stated, intelligence should be attached to and made the “handmaiden” of the geographic desks.

The creation within the Department of a centralized, over-all intelligence group in the Department is as illogical as the centralization of governmental intelligence operations in a single agency. The language of the Budget Report may be as well applied to the Department as a whole as it can be to the entire Government: “Extreme centralization of the intelligence operation is no more workable than would be the centralizing in one agency of the job of producing all statistics for the Government.”

Indeed, the plan submitted by Colonel McCormack is completely at variance with the principles stated in the Budget Report. It contemplates a centralized intelligence unit, not accountable to the operating levels. If a centralized over-all government intelligence unit is not workable—the Budget’s conclusion—then it follows that the proposed plan of extreme centralization in the Department itself is not workable.

It does not follow, however, as the Budget Report so cogently emphasizes, that there is not need for a top level intelligence unit in the Department as the Budget envisages for the Government as a whole in its conclusion #5, stated on page 3 of its memorandum of transmittal. There is, of course, need for some high-grade group “organized to analyze reports from the point of view of a department as a whole”, to provide coordination with other agencies, and to furnish general over-all direction to intelligence operations. This in itself is a heavy and highly important responsibility. But, to quote again from the Budget Report, this “research staff should be small and concerned primarily with bringing together intelligence available” throughout the Department “to fulfill a particular need.”

In conclusion, I feel that the Budget Report amply supports the grave misgivings that I have about the proposed organization for Colonel McCormack’s unit, which, if adopted, would mean that the Department would “continue a complete structure superimposed on top of” the existing structure of the Department and would expose the Department to the charge that it was incorporating the parts of OSS transferred to it without any “considerable readjustment and curtailment.”³

D.R.

A final thought: Intelligence is only as good as it is translated into action. Where is that? The geographic desks.⁴

0. Source: National Archives and Records Administration, RG 59, Records of the Department of State, Decimal File 1945–49, 101.5/11–345. No classification marking.
1. Dated September 20. (Ibid., RG 51, Records of the Office of Management and Budget, Director’s Files, Series 39.27, Intelligence) See the Supplement.
2. Document 38.
3. Russell canvassed at least some of the geographic divisions on their use of OSS reports during the war. (Memorandum from Braden to Russell, November 3; Truman Library, Papers of J. Anthony Panuch; and memorandum from Durbrow to Russell, November 2; National Archives and Records Administration, RG 59, Records of the Department of State, Records of the Bureau of Intelligence and Research: Lot 58 D 776, Birth of the Intelligence Organization in the Department of State) Both are in the Supplement.
4. The postscript is handwritten.