We begin our section on documents relating to the founding of the CIA with this report from Vandenberg, in which the DCI outlined his desired authority for a foreign intelligence agency. As we see in the following documents (159, 160), Vandenberg's request aroused a good deal of resentment, from both the State Department and the FBI. What was the key issue at dispute?

156. Draft Report by the Director of Central Intelligence (Vandenberg)/6/

/6/As indicated in Vandenberg's covering memorandum, the report was submitted to the National Intelligence Authority.

FUNCTIONS OF THE DIRECTOR OF CENTRAL INTELLIGENCE

Report by the Director of Central Intelligence, with the Unanimous Concurrence of the Intelligence Advisory Board

1. The President's letter of 22 January 1946, directing the establishment of the National Intelligence Authority, contained, in paragraph 3 thereof, a general description of the functions envisaged for the Director of Central Intelligence. N.I.A. Directive No. 1, containing the basic policies and procedures governing the Central Intelligence Group, further clarified the functions of the Director of Central Intelligence, particularly as regards his relationship with the National Intelligence Authority and the Intelligence Advisory Board. N.I.A. Directive No. 2 contained an initial personnel authorization for the Central Intelligence Group, providing only the minimum necessary for the tasks of organizing, surveying pressing problems, and meeting initial requirements. N.I.A. Directive No. 2 also instructed the Director of Central Intelligence to submit his recommendations for augmentation of the Central Intelligence Group as soon as practicable. Pursuant to those instructions, this report proposes a redefinition of the functions of the Director of Central Intelligence which will give him the necessary authority to augment the Central Intelligence Group so that he may effectively perform his assigned missions.

2. A draft N.I.A. directive, redefining the functions of the Director of Central Intelligence, is contained in Enclosure "A" (Appendix "A" hereto). Discussion of the provisions of this draft directive is contained in Enclosure "B" (Appendix "B" hereto).

3. The former Director of Central Intelligence, Rear Admiral Sidney W. Souers, has concurred in the recommendations contained herein. This report also has the unanimous concurrence of the Intelligence Advisory Board, which included the Director of the Federal Bureau of Investigation in this case.

4. It is recommended that the National Intelligence Authority approve the draft directive in Enclosure "A" (Appendix "A" hereto).

Appendix A

Draft National Intelligence Authority Directive

FUNCTIONS OF THE DIRECTOR OF CENTRAL INTELLIGENCE

Pursuant to the President's letter of 22 January 1946 designating this Authority as responsible for planning, developing and coordinating all Federal foreign intelligence activities so as to assure the most effective accomplishment of the intelligence mission related to the national security, the functions of the Director of Central Intelligence are hereby redefined as follows:/10/

/10/In a June 26 memorandum Vandenberg submitted a "corrected" form of the draft NIA Directive "based upon informal discussions of C.I.G. 10." At this point the following phrase was added; "subject to the provisions of the said letter." (Central Intelligence Agency Historical Files, HS/HC-276) See the Supplement.

1. Paragraph 3 of the President's letter of 22 January 1946 defined the functions of the Director of Central Intelligence as follows:

"3. Subject to the existing law, and the direction and control of the National Intelligence Authority, the Director of Central Intelligence shall:

"a. Accomplish the correlation and evaluation of intelligence relating to the national security, and the appropriate dissemination within the Government of the resulting strategic and national policy intelligence. In so doing, full use shall be made of the staff and facilities of the intelligence agencies of your departments.

"b. Plan for the coordination of such of the activities of the Intelligence agencies of your Departments as relate to the national security and recommend to the National Intelligence Authority the establishment of such over-all policies and objectives as will assure the most effective accomplishment of the national intelligence mission.

"c. Perform, for the benefit of said intelligence agencies, such services of common concern as the National Intelligence Authority determines can be more efficiently accomplished centrally.

"d. Perform such other functions and duties related to intelligence affecting the national security as the President and the National Intelligence Authority may from time to time direct."

2. In performing the functions specified in paragraph 3 a of the President's letter, the Director of Central Intelligence is hereby authorized to undertake such basic research and analysis of intelligence and counter-intelligence information as may in his opinion/11/ be required to produce the necessary strategic and national policy intelligence. This will include the centralization of research and analysis activities of common intelligence interest to more than one agency when, in the opinion of the Director of Central Intelligence, such activities can be more efficiently performed centrally. Under such procedure, existing organizations of the State, War and Navy Departments, including their funds, personnel and facilities, performing those functions, will be integrated into the Central Intelligence Group as a central service to all intelligence agencies subject to N.I.A. coordination./12/

/11/In Vandenberg's correction of June 26 the rest of this sentence reads: "and that of the appropriate member of the Intelligence Advisory Board, be required to supplement the research and analysis performed by the State, War and Navy Departments in the fields of primary interest to each of those Departments."

/12/The last sentence of paragraph 2 was eliminated in the June 26 draft.

3. In addition to the functions specified in paragraph 3 b of the President's letter, the Director of Central Intelligence is hereby directed to act as the executive/13/ agent of this Authority in coordinating and supervising all Federal foreign intelligence activities related to the national security in accordance with the over-all policies and objectives established by this Authority.

/13/In the June 26 draft "executive" was omitted.

4. Pursuant to paragraph 3 c of the President's letter, the Director of Central Intelligence is hereby directed to perform the following services of common concern which this Authority has determined can be more efficiently accomplished centrally:

a. Conduct of all Federal espionage and counter-espionage operations for the collection of foreign intelligence information required for the national security.

b. Conduct of all Federal monitoring of press and propaganda broadcasts of foreign powers required for the collection of intelligence information related to the national security.

5. To the extent of available appropriations and within the limits of their capabilities,/14/ the State, War and Navy Departments will make available to the Director of Central Intelligence, upon his request, the necessary funds, personnel, facilities and other assistance required for the performance of the functions authorized herein. At the earliest practicable date, the Director of Central Intelligence will submit for approval by this Authority any supplemental budget required to perform the functions authorized herein, in addition to the appropriations available for this purpose in the State, War and Navy Departments.

/14/In the June 26 draft the phrase "as determined by the respective Departments," was added at this point.

6. Where the performance of functions authorized herein requires the liquidation, transfer or integration of funds, personnel or facilities for existing activities of the State, War and Navy Departments, the liquidation, transfer or integration will be accomplished at the earliest practicable date by mutual agreement between the Director of Central Intelligence and the official now responsible/15/ for such activities so as to involve a minimum of interruption in the performance of these functions.

/15/The phrase "by mutual agreement between the Director of Central Intelligence and the official now responsible" became in the June 26 draft "as agreed to by the Director of Central Intelligence and the official responsible".

Appendix B

Discussion of the Draft National Intelligence Authority Directive

Discussion by paragraphs of the provisions of the draft directive in Enclosure "A" (Appendix "A" hereto) follows:

Paragraph 2: Paragraph 3-a of the President's letter makes the Director of Central Intelligence responsible for the correlation, evaluation and dissemination of strategic and national policy intelligence relating to the national security, making full use of the staff and facilities of the intelligence agencies of the State, War and Navy Departments. This means that the Director of Central Intelligence is responsible for the accuracy, adequacy and timeliness of intelligence required for the national security. To discharge his vital responsibilities, the Director of Central Intelligence should not be required to rely solely upon evaluated intelligence from the various Departments. He should also have the authority, when he deems it necessary in the interests of national security, to undertake within the Central Intelligence Group basic research and analysis of original and unevaluated intelligence and counter-intelligence information from all available sources. This authority is especially necessary to ensure adequate coverage, from a national viewpoint, of those fields which are of common intelligence interest to more than one agency, such as economics, science, biography, geography, sociology, etc. In many of those fields the national security requires that basic research and analysis activities be centralized so as to serve the intelligence agencies subject to N.I.A. coordination.

Paragraph 3: Paragraph 3-b of the President's letter charges the Director of Central Intelligence with planning for the coordination of intelligence activities related to the national security and recommending over-all policies and objectives to the National Intelligence Authority. No provision is made in the President's letter for an executive agent of the National Intelligence Authority who will be responsible for coordinating and supervising intelligence activities related to the national security so as to ensure that policies are properly implemented and objectives are successfully accomplished. Such coordination and supervision is considered a necessary step in the effective execution of the national intelligence program. It is therefore recommended that the Director of Central Intelligence be specifically charged with this responsibility.

Paragraph 4-a: It is considered that the conduct of all Federal espionage and counterespionage operations for the collection of foreign intelligence information required for the national security can be more efficiently accomplished centrally by the Director of Central Intelligence for the following reasons:

A. Conduct of this type of operation by the executive departments would almost certainly embarrass these departments in the conduct of their official overt activities.

B. Such operations must be centrally controlled to ensure that they serve the national interest rather than the interests of any single department or agency, and that they do not conflict with overt intelligence activities.

C. Since such operations require maximum security they should be performed by a single closely controlled central agency.

D. The danger of competition and confusion between agents of different agencies necessitates the use of a single agency. Moreover, the interdependency and interrelationship between geographical areas and foreign countries makes it imperative that there be one agency with world coverage. This does not, of course, preclude the use of specialized departmental personnel under rigid central control.

E. The difficult and specialized administrative problems involved in such operations make a single central agency more efficient and economical.

Paragraph 4-b: It is recommended that the conduct of all Federal monitoring of press and propaganda broadcasts of foreign powers required for the collection of intelligence information related to the national security be centrally operated under the Director of Central Intelligence for the following reasons:

A. The present organization carrying on this function under War Department direction should be liquidated because its reports are circulated too generally and its personnel have not been adequately screened for security.

B. This function is of value to the State, War, Navy and other Government departments. It should therefore be centrally directed to serve the needs of all these departments.

C. The Department of State appears to have the greatest interest, but the War Department is the only agency which has included funds for this function in its 1947 budget. The Department of State, however, has stated that it is not practicable for that Department to assume responsibility for this operation. The War Department considers that under no circumstances should it engage on a continuing basis in this predominantly nonmilitary intelligence function. The same viewpoint applies to the Navy Department. It therefore appears that this function is a service of common concern which can be accomplished more efficiently centrally.

Paragraph 5: The primary source of funds, personnel and facilities required by the Director of Central Intelligence to discharge the functions proposed in this report, should be those which can be made available by the State, War and Navy Departments. Since, however, some of these functions have not been performed by any department, or have not been performed on the adequate scale now contemplated, the Director of Central Intelligence should be authorized to submit for N.I.A. approval any supplemental budget required pursuant to this directive.

Paragraph 6: This paragraph is intended to ensure that the transition of any activities from departmental to central direction or operations be accomplished with a minimum of interruption in the performance of those functions.

159. Minutes of the Sixth Meeting of the Intelligence Advisory Board

Washington, June 28, 1946, 2:30 p.m.

//Source: Central Intelligence Agency Historical Files, HS/HC-281. Top Secret; Limited Distribution. The meeting was held at the War Department building.

PARTICIPANTS

Lt. General Hoyt S. Vandenberg, Director of Central Intelligence, in the Chair

Rear Admiral Sidney W. Souers, former Director of Central Intelligence

Members Present

Dr. William L. Langer, Special Assistant to the Secretary of State for Research and Intelligence

Maj. General Stephen J. Chamberlin, Director of Intelligence, W.D.G.S.

Commodore Charles J. Rend, USN (Representing Rear Admiral Thomas B. Inglis, Chief of Naval Intelligence)

Colonel E. P. Mussett (Representing Brig. General George C. McDonald, Assistant Chief of Air Staff-2)

Also Present

Mr. Park Armstrong, Department of State

Captain R. K. Davis, USN, ONI

Colonel Joseph A. Michela, G-2

Secretariat

Mr. James S. Lay, Jr., Secretary, National Intelligence Authority

1. Functions of the Director of Central Intelligence (C.I.G. 10)/1/

/1/Document 156.

General Vandenberg expressed regret that the original version had caused such turmoil. He explained that his primary purpose was to get the people necessary to do the job of assisting the three departments. He wants these people to try to find out where, because of lack of people or money, the departments have to stop their intelligence activities short of national requirements. General Vandenberg explained that he was not trying to unsurp any departmental prerogatives. He realized that C.I.G. cannot do its job unless there is an intelligence system within State, War and Navy which is as strong as possible. He wants to find out where the departments have to stop and thus where there are deficiencies or holes in our intelligence organization. General Vandenberg stated that he had talked with the Secretaries of War and the Navy, and with Fleet Admiral Leahy, and they were all in agreement with his concept. He would, however, welcome any comments or criticism on the subject paper.

Dr. Langer explained that he was very interested in making C.I.G. a real going concern, including provision of the necessary money and people. His chief objection to the paper was that it was rather loose in places and would subsequently give rise to suspicions. The State Department had no objection to a large part of the paper. It did object, however, to paragraph 2 of Appendix "A". Dr. Langer felt that this paragraph went beyond the provisions in the President's letter. He doubted that it was necessary for C.I.G. to undertake extensive research and analysis. He felt that if the departments showed themselves unable to do the job for C.I.G., specific authorization for C.I.G. to perform such functions could be given at that time. Dr. Langer also felt that it would be extremely difficult to define what fields were of primary or secondary interest to the departments.

General Vandenberg felt that point would be covered, since he was required to obtain the concurrence of appropriate members of the Board in any given case.

Dr. Langer noted that the decision as to which member was appropriate in any case was left to the discretion of the Director. He felt that setting up the proposition of negotiating with individual members would cause the Board to pass into eclipse. He would be very sorry to see that happen, since solidarity of the Board gave necessary moral support to the Director. Dr. Langer explained that it was only because of the interest of State in C.I.G. that he would like to avoid unnecessary debate, acrimony, or any suggestion that would break down the solidarity of the Board. He thought that paragraph 2 should be more specific, and therefore circulated an alternative paragraph 2.

General Vandenberg thought the alternative paragraph would tie his hands unnecessarily. If he is to produce national intelligence he must fill the holes as rapidly as possible. If he has to obtain approval by the entire Board in each case, it will become a debating society and no action will be taken.

Dr. Langer pointed out that the departments have definite functions and responsibilities which must be recognized. He noted that the Secretary of State has the responsibility of informing the President regarding the foreign situation and advising him of what should be done in that field.

General Vandenberg stated that one of the main purposes of this paper was to enable C.I.G. to define precisely the fields of primary interest to the departments.

General Chamberlin expressed his regret that he had to leave the meeting at this point, but stated that Colonel Michela could vote for him unless there were particularly controversial issues involved. General Chamberlin then left the meeting.

General Vandenberg said that he must prepare a supplementary budget within the next few days or C.I.G. would be without necessary funds during the fiscal year 1947. He was therefore anxious to obtain N.I.A. approval of the concept of this paper to enable him to secure the necessary funds. He felt that C.I.G. would be unable to find the gaps in the intelligence situation unless it was able to perform the research and analysis operation.

Dr. Langer expressed the understanding that the Central Planning Staff was designed to find the gaps.

General Vandenberg thought, and Admiral Souers agreed, that this was a problem for research and not for planning. Unless C.I.G. actually performed research functions, it would not know where the gaps were.

Dr. Langer asked whether C.I.G. intended to have so large a staff that it would be able to take care of any conceivable emergency.

General Vandenberg explained that he wanted only enough experts to find the holes. It would then be necessary to determine whether those holes could be filled by one of the departments or whether, in each particular field, the research and analysis should be centralized in C.I.G. In other words, he did not want to do the work now being done in the departments, but rather to find out what the departments cannot do.

Dr. Langer agreed with this concept, but felt that a revision of the wording of paragraph 2 was necessary.

After further discussion, a revision of paragraph 2 was accepted by the Board.

Commodore Rend was concerned about the wording of paragraph 3 of Appendix "A", since it seemed to infringe upon the responsibility of each Board member to execute approved N.I.A. recommendations within his department.

The Board agreed to a re-wording of paragraph 3.

Commodore Rend suggested that paragraph 4-a make it clear that C.I.G. would conduct such operations only outside the limits of the continental United States.

General Vandenberg noted that the Director of the Federal Bureau of Investigation had suggested a similar revision of paragraph 4-a, and this revision was accepted by the Board.

Colonel Michela suggested re-wording the last two lines of paragraph 5 of Appendix "A", and a revision was subsequently agreed upon by the Board.

The Intelligence Advisory Board:

Concurred in C.I.G. 10 subject to the following amendments to Appendix "A" thereto and appropriate changes in Appendix "B":

a. Revise paragraph 2 to read:

"2. In performing the functions specified in paragraph 3-a of the President's letter, the Director of Central Intelligence is hereby author-ized to undertake such research and analysis as may be necessary to determine what functions in the fields of national security intelligence are not being presently performed or are not being adequately performed. Based upon these determinations, the Director of Central Intelligence may centralize such research and analysis activities as may, in his opinion and that of the appropriate member or members of the Intelligence Advisory Board, be more efficiently or effectively accomplished centrally."

b. Revise paragraph 3 to read:

"3. In addition to the functions specified in paragraph 3-b of the President's letter and in accordance with paragraph 4 of N.I.A. Directive No. 1, the Director of Central Intelligence is hereby directed to act as the agent of this Authority in coordinating all Federal foreign intelligence activities related to the national security to ensure that the over-all policies and objectives established by this Authority are properly implemented and executed."

c. Revise paragraph 4-a to read:

"a. Conduct of all organized Federal espionage and counter-espionage operations outside the United States and its possessions for the collection of foreign intelligence information required for the national security."

d. Revise the last two lines of paragraph 5 to read:

"herein, in addition to the appropriations which can be made available for this purpose by the State, War and Navy Departments."

(Enclosure to C.I.G. 10 as amended subsequently submitted for N.I.A. consideration as N.I.A. 4.)/2/

/2/The NIA apparently did not meet as a body to discuss the draft directive. On July 8 the Secretaries of State, War, and the Navy approved Enclosure A to NIA 4 without change. Admiral Leahy, however, objected to the use of the word "agent" in paragraph 3 of Enclosure A because it might imply unwarranted freedom of the Director of Central Intelligence to act for the NIA. Vandenberg agreed that the language was subject to such an interpretation and stated that he had only intended that the Director of Central Intelligence would implement NIA policies. (NIA 4/1, Memorandum from Lay to NIA, July 8; National Archives and Records Administration, RG 218, Records of the Joint Chiefs of Staff, Leahy Papers, No. 132) The paragraph as revised is printed as paragraph 3 of NIA Directive No. 5, Document 160.

165. Letter From the Director of the Federal Bureau of Investigation (Hoover) to the President's Chief of Staff (Leahy)

Washington, August 23, 1946.

//Source: National Archives and Records Administration, RG 218, Records of the Joint Chiefs of Staff, Leahy Papers, No. 132. Personal and Confidential.

Dear Admiral Leahy: I am sure you will recall your recent conversation with Mr. Tamm of my office, on August 12th,/1/ last, concerning the Central Intelligence Group. With further reference to the matters discussed at that time I thought I should call to your attention the proposed CIG Directive No. 15/2/ which recently has been referred to me for approval and/or comment./3/

/1/See Document 124.

/2/The number 12 has been crossed out, and 15 has been inserted by hand.

/3/Hoover presumably was referring to a paper designated as CIG 12/1, "Exploitation of American Business Concerns, Non-Governmental Groups and Individuals with Connections Abroad as Sources of Foreign Intelligence Information," which was circulated to the IAB on August 21. (Central Intelligence Agency Historical Files, HS/HC-276) See the Supplement. It replaced an earlier paper on the same subject that carried the designator CIG 12. For the paper as finally approved, see CIG Directive No. 15, Document 171. There is an account of the debate over this paper in Darling, The Central Intelligence Agency, pp. 122-127.

Some of the provisions incorporated in this Directive have caused me considerable concern. Briefly, they provide for CIG operations within the United States and its Territories in a fashion which I regard to be an invasion of domestic intelligence coverage which, according to our laws, is the sole responsibility of this Bureau. I am attaching a copy of my letter of reply to General Vandenberg, in which I outlined my objections in detail. This letter should be self-explanatory.

We are sure you will agree that it is imperative that the present arrangement for domestic intelligence coverage should not be tampered with at this critical period. If the proposed Directive should be placed into effect, it is our feeling that it definitely would create considerable difficulty and would inevitably lead to confusion, duplication of effort and intolerable conditions to the detriment of the national well-being.

Sincerely yours,

J. Edgar Hoover

Attachment/4/

/4/Strictly Confidential; By Special Messenger.

Letter From the Director of the Federal Bureau of Investigation (Hoover) to the Director of Central Intelligence (Vandenberg)

Washington, August 23, 1946.

Dear General Vandenberg: I refer to your memorandum of August 21, 1946, concerning the exploitation of American business concerns, non-governmental groups, and individuals with connections abroad as sources of foreign intelligence information./5/ I must advise that the proposed directive which was attached does not incorporate the changes suggested in my letter of August 6, 1946,/6/ and I, therefore, cannot approve it. This new directive also includes provisions and statements in which I cannot concur and, in fact, must oppose.

/5/See footnote 3 above.

/6/Not found.

In the discussion attached to this new proposed directive it is stated: "Foreign intelligence information related to the national security, although it may be collected from sources whose headquarters are within the limits of the United States and its possessions, is definitely part of the national intelligence mission, the coordination of which is specifically a function of the National Intelligence Authority under the provisions of the President's letter of 22 January, 1946." This statement is not in agreement with Section 9 of the President's letter of January 22 which states: "Nothing herein shall be construed to authorize the making of investigations inside the continental limits of the United States and its possessions except as provided by law and Presidential Directives."

I note that in the proposed directive it is stated that field agents of the Central Intelligence Group will establish and maintain liaison with the intelligence officers of local Army and Navy headquarters and Air Force headquarters. If this means that the CIG will establish offices in the United States or will operate field agents within the United States or its possessions, I am of the opinion that this is not within the provisions of the President's original directive. I did not understand that the President's original directive contemplated the Central Intelligence Group engaging in any such activities within the United States and its possessions.

In connection with the proposed directive, as previously advised, I will approve a directive providing for the Director of Central Intelligence establishing uniform procedures for securing the cooperation of American business concerns in supplying foreign intelligence information required for the national security. As set forth in my letter of August 6 concerning the original proposed directive, the Federal Bureau of Investigation should be exempt from provisions requiring clearance from the Central Contact Register inasmuch as it is necessary for us to contact such various firms on a daily basis in matters involving the discharge of our domestic responsibilities. I desire also to reiterate my suggestion that the Central Contact Register advise the FBI with reference to each American business firm with which arrangements are made to secure foreign intelligence in order to prevent duplication of effort and possible embarrassment to both the FBI and the CIG.

I shall, of course, be most anxious to promptly transmit to the Central Intelligence Group any information gathered through our domestic operations involving foreign intelligence information relating to the national security.

With best wishes and kind regards,

Sincerely yours,/7/

/7/Printed from an unsigned copy.