One of General Vandenberg’s early concerns as Director of Central Intelligence was to secure a statutory basis for the existence of the Central Intelligence Group. During the concerted effort to establish a national foreign intelligence system in the months immediately following World War II, there was a tendency to think in terms of creating the system by Executive order or Presidential directive, both because it was more expeditious and because it minimized controversy. The Joint Chiefs of Staff plan (Document 13) clearly envisaged a Presidential directive; the McCormack plan appeared to do so; and when the Secretaries of State, War, and Navy reached agreement in January 1946, they also recommended action by Presidential directive. (Secretary of State Byrnes apparently believed that the Reorganization Act of 1945 gave the President the authority he required.)

The Joint Chiefs’ plan, however, envisaged that legislation would eventually be sought and so did its latter day variant, the Three Secretaries’ proposal, although the reference to future legislation had been eliminated by the time the proposal became the Presidential letter of January 22. (Document 71) Admiral Souers had made a strong recommendation for legislation in his final report to the National Intelligence Authority (Document 154), citing both the practical disabilities of operating as a non-statutory agency (e.g., inability to sign contracts, recruit personnel directly, or expend funds) and arguing that the CIG needed “the necessary authority and standing to develop, support, coordinate and direct an adequate Federal intelligence program.”

Vandenberg was already well aware of the problem when he was the Army representative on the Intelligence Advisory Board, but when he began his tenure as Director of Central Intelligence, with plans for a major expansion of CIG’s size and scope, he faced these difficulties as practical issues. Broken down into component parts, there were actually two problems, or two phases of the same problem. One was his strong desire to put the CIG on a statutory basis. From Vandenberg’s perspective, statutory authority was one important way (perhaps the most important way) to strengthen the position of the DCI, a thought presumably reinforced by Vandenberg’s initial skirmish with the Departmental intelligence chiefs over the definition of his authority.

There was also a more urgent reason for legislation. The Independent Offices Appropriation Act of 1945 (58 Stat. 361, Sec. 213) provided in [Page 519] effect that no agency could be in existence for more than one year without Congressional appropriation. There was thus a serious possibility that under the terms of the act, the State, War, and Navy Departments would be unable to transfer funds to the CIG after January 1947.

In the interim, as long as the Presidential directive of January 22 was the basic charter of the intelligence system, there was a pressing need to streamline the cumbersome administrative arrangements that it created. If Vandenberg were to proceed with his ambitious plans for the Central Intelligence Group, these arrangements would be impediments to rapid and effective action.

Vandenberg moved quickly and energetically on all these fronts. Within 3 days of becoming Director of Central Intelligence, he had received a legal opinion from his general counsel on the CIG’s administrative authority. It confirmed for him what he presumably already knew: “the essential problem is that CIG has no power to expend government funds.” (Document 196)

By early July 1946, Vandenberg’s legal advisers had prepared a draft bill for submission to the White House. (See the Supplement) It provided both for fiscal and other authorities the CIG lacked and for clear primacy over the Departmental intelligence agencies.

In a July 12 memorandum to Vandenberg, Clark Clifford, the President’s Special Counsel, complained about “the failure of the bill to define in clear terms the sense in which the word ‘intelligence’ is used. For example, ‘intelligence,’ ‘foreign intelligence,’ ‘intelligence relating to the national security,’ ‘strategic and national policy intelligence,’ ‘the national intelligence mission,’ and ‘intelligence affecting the national security,’ are used indiscriminately as though they were synonymous.”

In addition, Clifford thought the proposed bill was “self-contradictory,” and feared that “the failure to distinguish between ‘intelligence’ and ‘foreign intelligence’” would “lead to the suspicion that the ‘National Intelligence Authority’ and the ‘Central Intelligence Agency’ will attempt to control, with the powers granted to them in this bill, the F.B.I and other intelligence activities.” (See the Supplement)

At a meeting on July 16, however, Vandenberg’s legal counsel, Lawrence Houston, and NIA Secretary James Lay persuaded Clifford “that the original concept of the Central Intelligence Group should now be altered; experience had shown that it would be ineffective if it remained only a small planning staff and that it must now become a legally established, fairly sizeable, operating agency. Mr. Clifford stated that he would discuss this new concept with Admiral Leahy and the President.” (Document 197)

In the meantime, Vandenberg tackled the problem at his first formal meeting with the National Intelligence Authority on July 17, 1946, declaring frankly that he needed his own funds and that the CIG must be [Page 520] established on a statutory basis, and sketching some of his own plans for expansion. Vandenberg got a mixed reception from the NIA but on the whole, the outcome was favorable for his purposes. Admiral Leahy told him that the President opposed introduction of a bill to obtain an independent budget and status for the NIA, but that the NIA could draft one “with a view to the possibility of presenting it to the next Congress. Admiral Leahy stated that in the meantime he felt that General Vandenberg should be given, so far as practicable, all the assistance that he requires.” (Document 198)

The upshot was that the NIA agreed that Secretary of State Byrnes should try to find a solution to Vandenberg’s problems in consultation with the Director of the Bureau of the Budget, and report back to the Authority. The result of Byrnes’ inquiries was a complicated procedure, attached to Document 199 and the annexed correspondence in the Supplement, in which the Secretaries of State, War, and Navy in effect delegated certain fiscal authority to the Director of Central Intelligence, giving him working control over the funds that their Departments transferred to the Central Intelligence Group. The new arrangement eased the administrative burdens on the CIG and made the procedures under which it operated considerably less burdensome. Although in one sense a technical administrative matter, the arrangement was of broader significance, as the first step toward making the CIG autonomous.

Toward the end of 1946, the time seemed propitious for a renewed attempt along the legislative route, and Vandenberg submitted new draft legislation to the White House at the beginning of December 1946. (Document 201) By that time, however, it was becoming evident that a statutory enactment concerning the Central Intelligence Group and the national intelligence structure was more likely to occur as part of a bill on armed forces unification than as a separate measure. There was no necessary connection between the two subjects, but there had long been a tendency in some quarters to regard national intelligence organization less as an issue in its own right than as one of the many components of the complex problem of unifying the military services.

On June 15, 1946, President Truman, in a letter to the chairmen of the Senate and House committees on military and naval affairs, reported that the Secretaries of War and Navy had reached agreement on 12 principles on which unification legislation could be based. Among them was the establishment of a Central Intelligence Agency which would operate under a Council of National Defense, an early designation for what later came into existence as the National Security Council. (Public Papers of the Presidents of the United States: Harry S. Truman, 1946 (Washington: U.S. Government Printing Office 1962), pages 303–305) At that point there were still some questions on which the military departments had not yet reached agreement, but in January 1947 the Secretaries of War and the [Page 521] Navy reported to the President that they had resolved their remaining differences and reiterated their earlier support for unification legislation that would include provision for a Central Intelligence Agency. (Patterson and Forrestal to the President, January 16, 1947, in Senate Report 239, 80th Congress, 1st Session, National Security Act of 1947, page 5) Truman transmitted their letter to the Congress under cover of a brief letter of his own in which he noted that “Representatives of my office and of the armed services are engaged in drafting a bill to be submitted to the Congress for its consideration.” (Truman to President pro tempore of the Senate and Speaker of the House of Representatives, January 18, 1947; Public Papers of the Presidents of the United States: Harry S. Truman, 1947, pages 101–102)

Ever cautious about separate legislation on intelligence, the White House working group drafting the armed forces unification bill included the establishment of a Central Intelligence Agency as one of its provisions. The bill that was finally sent forward was much briefer and less comprehensive than Vandenberg and his colleagues in the CIG would have liked; their preference was for an “enabling act” that would spell out in detail the special powers and authorities of the Director of Central Intelligence, e.g., provisions governing unvouchered funds, exemption from laws and regulations relating to the expenditure of government funds, exemption from laws requiring publication of data on personnel, and procurement authority. But the White House continued to fear that a Central Intelligence Agency might prove controversial in the Congress and resisted efforts to expand the scope of the bill, hoping to keep the intelligence provisions as inconspicuous as possible and preferring that more detailed enabling legislation be submitted to Congress at a later date.

There was no Department of State representation on the White House-chaired drafting group that prepared the legislation, but the fourth draft of the bill, at least, was sent to the Department for comment. In a long memorandum to the President dated February 7, 1947, Secretary of State Marshall strongly criticized the provisions for establishing a National Security Council and expressed reservations about the provisions establishing a Central Intelligence Agency. Concerning the latter, he wrote:

“The Secretary of State is at present Chairman of the National Intelligence Agency [sic] composed of four members. The new agency would be responsible to the National Security Council which itself is subject to the objections already set forth and on which the Secretary of State is numerically subordinated to the heads of the military establishments. The Foreign Service of the Department of State is the only collection agency of the government which covers the whole world, and we should be very slow to subject the collection and evaluation of this foreign intelligence to other establishments, especially during times of peace. The [Page 522] powers of the proposed agency seem almost unlimited and need clarification.” (The full text of the memorandum is printed in Foreign Relations, 1947, volume I, pages 712715.)

Only one possibly related document has been found: a brief May 5, 1947, letter from Marshall to Senator Chan Gurney (Chairman of the Senate Armed Services Committee, which handled the National Security bill in the Senate) simply confirming that “The legislation regarding the CIG reflects the unchanged status of the agreement reached in February by the Secretaries of War and Navy and myself.” (Document 212) No other documents that shed light on the Department of State position and the apparent changes it underwent were found.

The House and Senate hearings and then the floor debate went on from February, when the White House submitted the bill, to late July, when both houses passed and the President signed the National Security Act of 1947. The provisions of the bill relating to intelligence attracted considerable attention, and issues such as whether the Director of Central Intelligence should be a military officer or a civilian were extensively debated. (For a detailed account of the Congressional consideration, see Troy, Donovan and the CIA, chapter XVI.) As finally enacted, Section 102 abolished the National Intelligence Authority, established the Central Intelligence Agency, and briefly spelled out the powers and responsibilities of the new organization and certain restrictions on it. The National Security Act of 1947 entered into force on September 19, 1947, and the Central Intelligence Agency came into being as a statutory body the next day.

The Central Intelligence Agency submitted enabling legislation the following year, but the 80th Congress failed to complete action before it adjourned. The bill was resubmitted in the next Congress, where it was enacted as the Central Intelligence Agency Act of 1949 and signed by the President on June 20, 1949. (Public Law 110, 81st Congress, 1st Session; 63 Stat. Ch. 227)

On September 26, 1947, the National Security Council met in its first session. In approving its own procedures, it authorized the Director of Central Intelligence “to attend all meetings of the Council as an observer and adviser.” (NSC Action No. 1; National Security Council, Policies of the Government of the United States of America Relating to the National Security, volume 1, 1947–1948, page 46) At the same organizational meeting, the NSC approved an “Initial Directive to the Central Intelligence Agency” endorsing recommendations that the Director of Central Intelligence had made in a September 19 memorandum to the Council. This action continued the National Intelligence Directives in force for the time being and instructed Hillenkoetter to submit to the Council within 60 days “proposed authorizations supplanting the former directives.” In the same action, the Council authorized the Director of Central Intelligence [Page 523] to submit to the Bureau of the Budget a budget estimate for fiscal year 1949. (Document 222 and NSC Action No. 3; Policies of the Government of the United States of America Relating to the National Security, page 53)

The Council took no action on Hillenkoetter’s proposal for an advisory committee, although it soon approved an amended version prepared by Souers, which created a successor to the Intelligence Advisory Board. (Document 226) The Council also failed to act on Hillenkoetter’s proposal, made in a memorandum to the NIA on September 11 (Document 220) for a subcommittee of the NSC composed of the Secretaries of State and Defense “to act similarly to the National Intelligence Authority to furnish the active direction of the Central Intelligence Agency.” Acting Secretary of State Lovett, however, endorsed the idea in a September 23 memorandum to Hillenkoetter, while suggesting that the oversight group include, in addition to the two secretaries, a personal representative of the President, similar to the arrangement that had existed in the National Intelligence Authority. (Document 224)