27. Memorandum From Secretary of the Navy Forrestal to Secretary of State Byrnes0

I am enclosing memoranda as follows:

Captain Souers, Assistant Chief of Naval Intelligence, to Mr. Eberstadt, who dealt with the question of central intelligence in his report to me on the proposed unification of the Armed Services;1
A memorandum from me to Admiral King;2
A response from Admiral King.3

I wish you would regard this as an informal transmission and return these papers after reading. Subsequently, I would like to suggest4 that you put on the agenda of one of the meetings with Bob Patterson and myself,5 this question, which it seems to me is one of the most important, considering the state of the world, that we have before us as a government.

James Forrestal
[Page 61]

Enclosure 16

Memorandum From the Assistant Chief of Naval Intelligence (Souers) to Ferdinand Eberstadt

As your program7 envisages the creation of a strong central intelligence agency, I would like to invite your attention to certain developments which may possibly facilitate the program but if prompt and adequate action is not taken may make it difficult if not impossible of accomplishment in a form satisfactory to the Navy.
The President on 20 September 1945 directed the Secretary of State to take the lead in developing a comprehensive and coordinated foreign intelligence program for all federal agencies concerned with that type of activity and suggested it be done through the creation of an interdepartmental group heading up under the State Department.
This morning it was announced in the press that Colonel Alfred C. McCormack, Director of the Intelligence Group of MIS, has been selected by the State Department to head up the unit of OSS transferred to State and presumably to develop the program for the Secretary of State in line with paragraph 2.
That part of OSS not awarded to State has been transferred to the War Department. The Navy was ignored in the disposition of the functions and assets of OSS.
To adequately protect the interests of the Navy during this crucial period, it would appear that aggressive action is required and the following recommendations are respectfully submitted:
The Secretary of the Navy attempt to arrange with the Secretary of State for the early creation of a committee or group which would include representatives of the Secretaries of War and Navy. This would make available at the working level the requirements of the services for the guidance of the Secretary of State.
The Naval officer selected should be thoroughly familiar with the intelligence requirements of the Navy, should be thoroughly trained in intelligence and understand the detailed operations of ONI and should understand the manner in which the departmental intelligence agencies operate and overlap.
S.W. Souers

Captain, USNR
[Page 62]

Enclosure 28

Memorandum From the Commander in Chief, U.S. Fleet (King) to Secretary of the Navy Forrestal

Replying to your memorandum of 4 October,9 it is my thought that the Navy has four main objectives in the field of Intelligence.
Maintenance of an adequate and efficient Naval Intelligence Service with control by the Navy of collection, processing and dissemination of operational communication intelligence and other functions necessary to the exercise of naval command.
Elimination of all unnecessary duplication in ONI of those intelligence functions which properly belong to the State or War Department.
Unification of intelligence activities of common concern to the State, War and Navy Departments in order to synthesize Departmental intelligence on the strategic and national policy level.
Improve facilities for the acquisition of secret foreign intelligence for the use of the U.S. Government.
With the reorganization of the Office of the Chief of Naval Operations all intelligence functions in the Navy will be consolidated under the Chief of Naval Intelligence.
In November 1942, General Marshall and I directed our intelligence services to explore ways and means of merging their activities in order to eliminate duplication, reduce overlaps and make headway toward a unified intelligence agency. Thereafter, a number of joint activities were established; also each of the services undertook the performance of certain intelligence functions in behalf of both. These activities have been successful. It is my desire that those having peacetime application be continued and that additional joint projects be established.
Complete merger of the intelligence services of the State, War and Navy Departments is not considered feasible or desirable since each of these departments requires operating intelligence which is of no value or interest to the others and in the acquisition and processing of which peculiar abilities and background knowledge are indispensable.
I recommend establishment of a central intelligence agency, along the lines of the proposal recently approved by the Joint Chiefs of Staff, to coordinate and as far as practicable unify all foreign intelligence activities, and to synthesize all the intelligence concerning military, political, [Page 63] economic and technological developments abroad for the benefit of those responsible for the determination and execution of governmental policy pertaining to national security.
If a central intelligence agency is created along sound lines, with the Navy adequately represented on both the policy making and working levels so that a flow of intelligence required for naval planning will be assured, many functions now performed by ONI can be transferred to that agency.
It has come to my attention that in a letter bearing the same date as the Executive Order abolishing OSS the President directed the Secretary of State to take the lead in developing a comprehensive and coordinated foreign intelligence program for all federal agencies concerned with that type of activity and suggested it be done through the creation of an interdepartmental group heading up under the State Department.
It is recommended that the Secretary of State be urged to expedite the establishment of an interdepartmental group for this purpose which will include representatives of the Secretaries of War and Navy who know the intelligence requirements of the services and who are thoroughly familiar with the organization and operating procedures of the departmental intelligence agencies.
E.J. King

Fleet Admiral, U.S. Navy
  1. Source: National Archives and Records Administration, RG 59, Records of the Department of State, Decimal File 1945–49, 101.5/10–1345. No classification marking.
  2. Printed as enclosure 1.
  3. In this memorandum, October 4, Forrestal proposed a meeting with Hoover, McCormack, Inglis, and Bissell. (Ibid.) Attached to the same memorandum Forrestal apparently sent a copy of enclosure 1 and asked for King’s “suggestions as to Navy objectives and recommended methods of implementation.”
  4. Printed as enclosure 2.
  5. At this point Forrestal added by hand in the margin the words “for your consideration.”
  6. A reference to the periodic meetings of the Secretaries of State, War, and Navy known as the “Committee of Three.”
  7. No classification marking.
  8. A reference to the Eberstadt Report.
  9. Secret.
  10. See footnote 2 above.