237. Memorandum For the Record1

1. Role of the AEC Intelligence Component

On 16 September 1971, I met with Jim Schlesinger, Chairman of the Atomic Energy Commission in his office in Germantown. The purpose of the meeting was to receive from him the observations about the Agency and the intelligence community gained through his years as an Assistant Director of BOB and OMB. Before getting into this subject, Schlesinger sought my views as to the role of the AEC intelligence unit. I told him that due to an almost complete lack of participation in USIB activities, I was unable to be helpful. I added that I had never heard any adverse comment about the AEC unit or Harold Brown, who has led it for the past several years. I suggested that the Director would be the best person to talk with about this subject. In the course of the conversation, it developed that he feels that the Atomic Energy Commission has played no role whatever in national security policy-making since John McCone left the Commission in 1961. Schlesinger feels that the Commission should play a role and I gather that he questions whether the AEC intelligence unit is now competent to do this. He tends to look upon their current performance as being helpful to CIA in spotting any personalities in various laboratories and really being rather limited in being able to brief the Commissioners on what is really going on in the world. It is apparently Jim’s impression that on any subject of importance, they have to whistle up Dave Brandwein or some other CIA analyst to do the briefing. He indicated definitely that he would seek either an early morning or late afternoon appointment with the Director sometime soon to pursue this subject.

2. Community Reorganization

Schlesinger believes that as a result of all the recent deliberations about reorganizing the community that the President will shortly issue some proclamation which will give the Director a good deal more authority in the intelligence community than he now has. Just what form it will take, he is not sure but as a minimum, he thinks the Director will be required to weigh in on an intelligence community budget before it goes to the President. He opined that this proclamation couldn’t hurt either the Director or the Central Intelligence Agency and might well [Page 532] do some good. He understands that Dr. Hall will be coming aboard very shortly to become the new Assistant Secretary of Defense for Intelligence. He has heard both good and bad things about Dr. Hall and has his fingers crossed, believing as he does, he will have a difficult time at best operating at the Assistant Secretary level. He speculated that a lot would depend upon the support he receives from David Packard for whom he has the highest regard but whose management style he characterized as “intuitive.” He was emphatic as usual in believing that the first order of business is to get the intelligence problems in the Defense Department straightened out or at least on the right track. With regard to the community generally, he repeated that he thinks far too much is being spent on collection and particularly tactical and SIGINT and that not enough is being spent on analysis. With regard to the cost of the intelligence community, he feels very strongly that SIGINT has to be cut back and alleges that its costs are now understated inasmuch as there are costs such as training which aren’t now included in their presentations. He regards the CIA analytical capability as being not only the best in town but really the only truly professional competence in town.

With regards what to do about the intelligence budget, he is convinced that you cannot maintain anything like the present level with sheer logic. Both the President and the Congress seem determined to reduce the size of the budget and Schlesinger’s solution, at least in part, would be to find some way to put some of the things now included in the intelligence budget, Mapping for example, somewhere else. If this is the game, then we ought to start to play it.

3. CIA’s Relationship with OMB

In general, Schlesinger is well disposed toward the Agency and believes that we have fared a good deal better because he has defended us than would have otherwise been the case. He describes the key personalities at OMB as follows: George Schultz is a very broad-gauged and able man who understands the President, doesn’t take everything the President says literally and is the man the Director ought somehow to find a way to deal with. Weinberger takes everything the President says literally and is a bureaucrat with very little flexibility. The International Programs Division staff, with which we deal on a day-to-day basis (Frey, Strait, Taylor, Hurley, etc.) are very well disposed toward CIA except on the manpower front where they think we could stand further reductions. They are not, however, as influential in the new setup at OMB as they used to be. Ken Dam, who replaced Schlesinger, has not had any experience in this area and the danger lies in the possibility that he will take his cue from Weinberger. If he also takes his cue from the staff on manpower, we could be in for some pretty rough sledding.

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All of the above was given to me in strict candor and also in strict confidence for obvious reasons. If Schlesinger is right about all this, and I am inclined to think he is, it is clear that we should find some way to deal with Schultz more than we have in the past and I think probably only the Director can do this. It is equally clear that the Executive Director-Comptroller, the Deputies, and other key officials should work as closely as possible with Dam.

  1. Source: Central Intelligence Agency, Executive Registry Files, Job 80–M01048A, Box 15, Folder 5, ExDir/Comptroller (Colby) Files, Intelligence Community. Secret; Sensitive.