236. Memorandum From the President’s Deputy Assistant for National Security Affairs (Haig) to the President’s Assistant for National Security Affairs (Kissinger)1


  • Your Luncheon with PFIAB, Thursday, September 9

Admiral Anderson has invited you and General Haig to lunch with PFIAB at 1:00 p.m., Thursday, September 9 (Tab F).2 The staff has prepared the following talking points to cover the four topics with which PFIAB is most concerned at the moment.

[Page 528]

1. Economic Intelligence

  • —The quality of economic intelligence on the reactions to the President’s August 15 program has been excellent.3 However, because it is so voluminous there is little time to synthesize it sufficiently so that it could be passed to the President. The intelligence community might, therefore, consider synthesizing economic intelligence, especially in the next several months when other nations are attempting to formulate a response to the President’s new program.
  • —Also, because the analysis of different agencies is often colored by their policy viewpoint on such questions as the ability of our trading partners to revalue their currencies or institute reforms in the trade and monetary areas, it might be very useful for the CIA to develop analysis on this question. Specifically, we need more information on precisely how far our trading partners can go in revaluing and liberalizing what the effects on their economies of so doing would be, and what the political and economic implications (in the form of retaliation, export subsidies, and capital restraints) would be if we pressed them to do more than was reasonable.

[Omitted here are talking points for topics 2 and 3.]

4. Intelligence Reorganization

In a report dated June 8, 1971, the PFIAB submitted its unanimous findings and recommendations to the President regarding the management and organization of the U.S. foreign intelligence effort. The report is at Tab A.4 In terms of organization, the report unanimously recommended:

  • —Making the U.S. Intelligence Board (USIB) the coordinating body of the intelligence community and altering the composition of the Board to give dominance to the users of intelligence rather than the collectors and producers. The Director of Central Intelligence (DCI) would continue to chair the USIB.
  • —Creating two new committees, an Intelligence Evaluation Committee and an Intelligence Resource Committee, under the USIB, each chaired by the DCI.
  • —Establishing an Assistant Secretary of Defense for Intelligence (ASD/I) to coordinate the intelligence resources of the Department of Defense.
  • —Relieving the DCI of his day-to-day management and administrative functions in CIA and giving the Director of the National Security [Page 529] Agency increased authority over all government communications and electronics intelligence.
  • —Maintaining the current status of DIA.
  • —Removing mapping from the intelligence budget and transferring it to other DOD programs as directed by the Secretary of Defense.
  • —Authorizing the Chairman of the PFIAB to attend meetings of the USIB.

The report also contained recommendations regarding establishment of a community-wide information handling system, greater emphasis on economic intelligence, more use of embassy officials in intelligence reporting, and more use of FBI in the clandestine collection of foreign intelligence within the United States.

The PFIAB proposal and that developed by the NSC/OMB staffs (Tab B)5 share many common features, but also have significant differences. Both agree that community-wide leadership is needed. Both agree that resources can be used more efficiently. Both agree that the quality of the product can be improved. Both agree that consumer requirements for intelligence must be an integral part of the process. Both agree that whatever changes are made should be accomplished without new legislation.

However, the NSC/OMB staffs do not believe that strong, continuing, and impartial leadership can be accomplished by a committee or series of committees. This requires the assignment of authority over community resources to a single individual. This is a fundamental requirement that no plan of reform should ignore. Committee-type leadership, in the form of the USIB, has historically failed to be effective. It is not clear, therefore, that a simple reorganization and strengthening of the USIB, is proposed by the PFIAB, would succeed in achieving the President’s objectives.

The current proposal calls for five major changes:

  • —A strengthened community-wide management role for the DCI.
  • —A new NSC Intelligence Community established primarily to review the substantive intelligence product and to give policy guidance on intelligence needs to the DCI and the community.
  • —Two advisory groups to the DCI to support him in his stronger community-wide role:
  • —A new Intelligence Resources Advisory Committee which would advise him on the allocation of intelligence resources.
  • —A USIB which would be strictly advisory to him on the efficient use of existing collection assets and production of substantive intelligence.
  • —A new Net Assessment Group within the NSC staff for reviewing and evaluating all intelligence products and for producing net assessments.
  • —Limited functional realignment within Defense to accomplish certain consolidations (mapping, investigations); the assignment of full responsibility for clandestine HUMINT collection to CIA; and, a restructuring of the National Reconnaissance Office under DOD control.

These changes are designed to accomplish the President’s four major objectives:

  • —Authoritative and responsible leadership for the community as a whole.
  • —A more efficient use of resources by the community in the collection of intelligence information.
  • —Abolition of outmoded divisions of labor within the community.
  • —Improvements in the quality and scope of the community’s substantive product.

You may want to probe the members of the PFIAB regarding some of their recommendations. For example:

  • —Why do they believe altering the USIB is the best way to achieve better performance and increased efficiency in our intelligence system? Why not pin the responsibility directly on the DCI?
  • —What areas do they see where substantial savings can be achieved?
  • —Should the Director of NSA have direct authority over service COMINT and ELINT organizations?
  • —What are the areas of excessive duplication and overlap in collection activities?
  • —How can discipline regarding leaks in the community be enhanced?
  • —Why should the present structure of the NRO be retained?
  • —Why should mapping, charting and geodesy be removed from the intelligence budget?
  • —Why does the PFIAB support the establishment of an Assistant Secretary of Defense for Intelligence?
  • —How does the above square with their recommendation that requirements for tactical intelligence resources by Unified and Specified military commanders must be fully recognized?

  1. Source: National Archives, Nixon Presidential Materials, NSC Files, Agency Files, Box 276, President’s Foreign Intelligence Advisory Board, 1971, Vol. VI. Top Secret; Bye-man. Sent for action.
  2. Attached but not printed.
  3. Reference to Nixon’s August 15 address to the nation concerning his “New Economic Policy,” See Public Papers: Nixon, 1971, pp. 886–91.
  4. Document 232.
  5. Attachment to Document 229.