44. Memorandum From the Comptroller of the Central Intelligence Agency (Taylor) to Director of Central Intelligence Turner 1


  • Section 3 of PRM/NSC 11

1. You asked yesterday for an analysis of the options presented for discussion in Part III of the PRM 11. We understand that you found the paper confusing and an unsatisfactory basis for a discussion with the President on the issues raised.2 After carefully studying the paper, we certainly agree that the treatment of the options is confusing and that the paper itself could stand considerable improvement. From a tactical standpoint, however, this paper, as it stands, may provide you with a strong negotiating position. As you pointed out in our discussion, we may be able to use selectively parts of this paper as takeoff points to buttress your argument for line control options. When we finally unravelled the intertwined options and tracked through the analytical and descriptive sections, we realized that the paper contains persuasive, if disjointed, logic for centralization and puts forth line control options (5 and 6) that can be used as your “go for broke” [Page 259] position. From our perspective, the obvious weaknesses of this paper play to our strength. For example, in discussions with the President, Secretary Brown, and Dr. Brzezinski, you can be positive about the logic for centralization and strongly support two of the options. None of the other options make much sense to us. This tactic puts Secretary Brown in the unenviable position of either pushing for an unattractive option or embarrassing Dr. Brzezinski by stating that the paper poorly presents the options and is, therefore, an inadequate basis for discussion. Neither of these approaches would seem to be very promising avenues for Secretary Brown to select. The critique of the options in the attached paper is designed to help you exploit the tactical opening presented by PRM 11.

2. There are also important tactical considerations in deciding whether your first choice is a variation of Option 5 or Option 6. Because Options 5 and 6 are alike in giving to the DCI line control over the essential elements of the NFIP, a choice between them rests largely on your choice of tactics. We can envision two scenarios. You could press for Option 6 now, arguing the need for centralization and functional realignment of the Community for all the reasons we have discussed elsewhere. We believe it would be wiser, if you choose this course, to state in broad terms the organizational objectives you will seek to carry out as you proceed with the reorganization, rather than describing a detailed organization at this time. This would maximize your flexibility and make it more difficult for others to attack on organizational details which should not be allowed to cloud the large issues. Such objectives might include:

—The desirability of an integrated estimating and production organization directly responsible to you.

—The desirability of placing collection programs under unitary management with clear responsibility for maximizing the use of collection resources to meet intelligence needs of national and military customers.

—The need to build procedural arrangements that guarantee that all activities of intelligence are conducted in a legal and ethical manner.

3. If you adopted this strategy and encountered major opposition to a functional realignment, you could fall back to Option 5 and offer to consider functional realignment at a more deliberate pace and with the full participation of those who would be affected.

4. Alternatively, you could press now for line control without functional realignment, reserving the right to consider that later. Under this approach, a reasonable fall-back position is much harder to envision. One approach would be to argue for line control over [2 lines not declassified] Your reasons for giving way on some parts of the CCP might be that over the long term you believe that effective unified [Page 260] central management of CIA, NSA, and the [less than 1 line not declassified] are more critical to your ability to meet national intelligence needs than is control over [less than 1 line not declassified] and tactical COMINT collected by some CCP units. You also may want to consider giving DoD control over some clearly tactical portions of the NRP. In any event, your fall-back position, if you press first for Option 5, is less satisfactory.

5. This memorandum and the attached paper represent a quick first cut on a very complex problem with complicated organization and political issues. We would like to meet briefly with you once you have had a chance to read our paper. Our ability to provide you with useful staff assistance would be improved by a few more sessions similar to the short meeting in your office on Thursday morning.3

James H. Taylor 4


Paper Prepared in the Central Intelligence Agency 5


The PRM sets forth a number of objectives and principles designed to serve as benchmarks for analyzing the desirability of various changes in the Intelligence Community. This list is important because it gives purpose to the discussion of options. Without it, we are confronted only with a struggle for power and a mindless debate about abstract changes. The list is summarized here, and we have attempted to use it as the basis for our critique of the options which follow.

Objectives and Principles

—The Community must be structured and managed so as to provide responsive intelligence support to the wide diversity of consuming organizations at many levels.

US intelligence must be responsive in two senses. It must be relevant to the real needs of US decision makers. It must be responsive to needs that the consumer does not yet fully appreciate, not just for today’s problems, but for the future as well. It must also be timely.

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US intelligence must be accurate, analytically penetrating, and sophisticated.

—Intelligence judgments must be candid and objective, unbiased by policy preference.

—Its activities, particularly the most expensive activities of intelligence collection and processing, must be managed in an efficient or generally cost effective manner.

—Our intelligence system must be able to share data and judgment within itself, and, on major issues, to collaborate in disciplined agreement or disagreement.

US intelligence must be capable of supporting the conduct of war with the minimum of disruptive transition.

US intelligence must be organized to minimize any potential of subverting constitutional principles and basic individual rights. Its activities must be demonstrably consistent with US legal and basic political standards.

Weighing the eight basic options presented in the PRM against these objectives and principles, we believe only Options 4, 5, and 6 merit serious discussion. You will find a detailed analysis of these three options and the variations on them in the narrative presented below. Our analysis of Options 1, 2, 3, 7, and 8 is limited to the following comments:

—Option 1 represents an attempt to improve marginally the status quo by making somewhat more specific the rules under which the DCI influences resource allocation decisions within the PRC or on his own. Unfortunately, few specifics are presented which would explain how precisely this would be done or how the DCI might use the prerogatives apparently provided to meet his responsibilities. The basic problem is that language changes in an Executive Order cannot modify existing statutory lines of authority. While most of the proposed changes in the Executive Order are sensible, we doubt they would have any significant impact on your real ability to achieve the objectives and principles set forth above.

—Option 2 calls for a further decentralization of the Intelligence Community by increasing the current ability of department heads to ignore selectively DCI (PRC I) priorities. It is clearly a step backward to the pre-1973 era.

—Option 3 is beyond our comprehension. We do not understand what is contemplated here.6 The option would appear to scrap all of [Page 262] the efforts undertaken since 1973 to build some centralized control over the Intelligence Community and take us back to the basic relationship which obtained between DoD and CIA in the 1960s. Alternatively, if legislation to implement this option is contemplated, the option appears to be designed to give the DCI budgetary authority over the Intelligence Community as in Option 4, but apparently leaving departments free to reprogram funds into or out of intelligence programs as desirable.

—Option 7 represents the DCI as the “titular” head of the Intelligence Community. It removes his line control over CIA, including intelligence production components, and gives all resource management authority to the Secretary of Defense. The DCI is left with the responsibility for setting requirements and priorities and production of national intelligence. Essentially the DCI becomes an intelligence staff aide to the Secretary of Defense.7

—Option 8, which places the DCI in a subordinate line position to the Secretary of Defense but in charge of the four national intelligence elements of the NFIP with all the powers outlined in Option 5, is at least organizationally workable because one manager would control the majority of Intelligence Community assets. This option has only one major flaw, but we believe it is fatal. Even an exceptionally strong DCI would not be able to keep the Intelligence Community from increasingly coming under the influence of DoD requirements and Departmental policy influence. We doubt that intelligence judgments and estimates could remain free of departmental policy influence regardless of the best intentions of all involved.

Options 4, 5, and 6 deserve more detailed analysis. As noted in the PRM, these options scrap the present DCI-White House-DoD-State collegial PRC (I) system entirely. They represent basic structural changes to the Intelligence Community by changing degrees of line, resource, management, and tasking authorities. As noted in the PRM, “This course is appropriate if one assumes:”

“—Greater centralization of authority and responsibility over the diverse elements of the Intelligence Community is required.”

“—That setting forth various means for accomplishing increased centralization while retaining mandatory and responsive service to a broad range of consumers is needed.”

“—The present authority of the DCI is inadequate for the responsibilities assigned.”

[Page 263]

“—The DCI’s current control of CIA and of the national tasking mechanism and chairmanship of the collegial resource allocation structure are judged to fail to provide the necessary responsiveness from the Intelligence Community to his direction.”

“There is a . . . consensus that the potential resource savings to be achieved by creating a single comprehensive national intelligence analysis center serving all consumers is more than offset by the inherent danger that differing judgments and perspectives would be suppressed and denied to the users of intelligence. For that reason none of the suggested options include centralization or other significant intrusion on the continued existence of viable competitive centers of analysis.” (Comment: We understand “viable competitive centers of analysis” to be synonymous with departmental intelligence units such as State and DIA.)

Option 4

Option 4 provides “full” DCI authority over resource allocation to national intelligence entities. He is specifically given the authority to select the elements to be included in the NFIP (subject to departmental appeal to the NSC) and to review, amend or veto expenditures he finds inappropriate or unresponsive to his needs. He is given authority to set all collection and production priorities and to task collection systems (though because he lacks line control, he cannot ensure compliance with his requests). He no longer shares resource allocation authority with the PRC, and the NFIP budget which he recommends is “fenced,” that is, other program managers cannot add to or reduce funds made available to the NFIP without DCI approval.

The PRM is rather vague on how precisely these powers are to be conveyed to the DCI, though it seems to conclude that new legislation would be required.

The “full” DCI authority over resource allocation called for in Option 4 is not specified in sufficient detail to clarify precisely what the DCI’s authorities would be or how exactly he would exercise them. The intent, however, appears to be to give him the authority to supervise an effective budget process, to ask for and receive necessary information from the various Community components and to prepare an integrated request to OMB and the President. Much less clear is the DCI’s responsibility to defend the budget before Congress, and even less clear or perhaps nonexistent is his responsibility to ensure effective and legal execution of the budget once appropriations have been approved by Congress.

Our experience with the budgetary influence the DCI is able to exert over the Intelligence Community through the mechanism of the PRC suggests that the purse string can be used effectively generally [Page 264] to influence or to coordinate national programs over a two- or three-year period of time. By themselves, however, budgetary powers are not sufficient to carry out all the basic responsibilities. The budgetary process can be used more effectively negatively than it can positively. With this power the DCI can exercise a slow veto over programs he wishes to terminate but it is difficult to exercise bold initiatives or to explore new and imaginative programs solely through the control of funds in a long budget cycle.

Option 4 is unclear as to whether funds for programs recommended by the DCI would be appropriated to him for further allocation to the various members of the Community, or whether his role essentially ends after the review of the program leading up to Presidential [decision. There] is precedence for such an arrangement. The so-called poverty program established in the Office of Economic Opportunity (OEO) in the early 1960s in fact was designed to function in this manner. The basic concept was that funds would be appropriated to the Director of OEO but that the responsibility for actually conducting programs would generally be delegated to other existing departments of the Government. The Director OEO would shape the budget in accordance with his priorities, defend it before Congress, but leave the day-to-day management of, for example, manpower training programs, to someone else, in this case the Secretary of Labor. By the late 1960s when OEO’s appropriation was about $2 billion, about $1 billion was appropriated to the Director of OEO but transferred thereafter by him to the Secretary of Labor for the conduct of manpower programs. The idea had appeal but in fact was largely judged a failure. The Secretary of Labor had vastly more influence over the budget which legally was to be prepared by the Director OEO than one would have thought, given the original concept established in law. We doubt that were the DCI to have a similar responsibility with respect to NSA, [less than 1 line not declassified] today the situation would be much different. Because the Secretary of Labor directly operated the manpower programs and had much experience with them, because he had good Congressional contacts, because both OMB and the White House turned to the Secretary of Labor instead of the Director OEO for advice, OEO often found itself rubber stamping what the Secretary of Labor had already agreed to do with others. In fact OEO was never able to get the Labor Department to concentrate on the activities it thought were important in the manpower program area. Doubtless there have been other analogous approaches to this problem in previous times although we are not aware of any of significant size. In this particular case, after a fair amount of backbiting between OEO and the Department of Labor and a growing recognition by everyone that little was gained by appropriating the money to OEO, a decision was eventually made to appropriate [Page 265] the funds for these programs directly to the Department of Labor. No one knew the difference.

Options 4A through 4E are responsive to basic arguments that a serious conflict of interest is created if the DCI is endowed with authority over Community resources as specified above but simultaneously maintains line authority over CIA.

Option 4A would attempt to ease this conflict of interest by creating a new Director/CIA who would however report to the DCI. Although this would have some cosmetic effect, it is unclear how exactly this resolves the conflict of interest, since the arrangement is little different in substance from that which exists today.

Options 4B, 4C, and 4D would have the Director/CIA report to the NSC, the Secretary of State, or the Secretary of Defense, respectively, instead of the DCI. In creating a Director/CIA who would report to the DCI on budgetary issues and to the NSC on other questions, the DCI’s ability to command an effective production process is greatly weakened. The Director of CIA, like the [1 line not declassified] Director, NSA, would report to one boss for policy and operational matters and to a second boss on resource issues. Options 4C and 4D suffer from these same defects and in addition, produce a situation in which the policy or operational needs of the Department of State or Defense could fundamentally alter the objectivity of the intelligence products prepared by the Director/CIA who would report to the Secretary of State or Defense. In short, we find Options 4B, 4C, and 4D totally unworkable.

Option 4E would disband CIA, adding CIA’s analytical element (DDI) to the DCI’s immediate organization and spinning off other CIA functions to other departments (unspecified, but probably Defense and/or State). This option at least has the virtue of giving the DCI a capability to carry out his most fundamental production responsibilities but would further weaken his already tenuous ability to direct collection systems in support of his substantive production needs, although it is true that his expanded role with respect to the budget would offset this loss to some degree. However, it seems inevitable that the CIA components transferred to other Departments would eventually be recast to meet the intelligence needs of those organizations, rather than those of the DCI, and the DCI’s budgetary authorities would not appear adequate to prevent this from occurring.

Option 5

Option 5 would give to the DCI line authority (which includes full and unambiguous resource authority) over four national intelligence programs—CIA, NSA, [less than 1 line not declassified] The option apparently contemplates that the four national intelligence programs would [Page 266] retain their present organizational integrity. Because a DCI who managed these four entities, however, would relatively quickly discover ways to improve the organizational structure resulting from this consolidation, we believe it is only a question of time before Option 5 would be reconfigured to look something like Option 6 discussed below. Giving the DCI line control over these four entities would:

—Guarantee central, unitary control over the principal elements of the national intelligence community, which means that one individual would be responsible for the effective performance of most of the community and would have effective authority to ensure the overall quality of the effort.

—Make one individual responsible for the legality and propriety of most national intelligence activities.

—Create the potential for resource savings through DCI total responsibility, resource and line, over national systems.

As noted in the PRM, problem areas introduced by this option include:

—How the unity of the existing US SIGINT system could be maintained (assuming that the Service Cryptologic agencies which collect cryptologic information and feed it to NSA for processing remain in Defense).

—How sufficient responsiveness could be assured in crisis and war to the command responsibilities of the Secretary of Defense and the field commanders, given the fact that national collection assets are essential to the conduct of military operations, and their effectiveness in combat support is proportional to the extent they are integrated into the military command and control system at all echelons; and

—How the national assets themselves, which are critically dependent on Defense-operated support activities, could be effectively related to those support activities within Defense.

Option 5A would establish a Director/CIA who would be responsive in a line command sense to the DCI, as would the Director, NSA, and the heads of [less than 1 line not declassified] This seems sensible, indeed obvious, if further consolidation and realignment along functional lines as specified in Option 6 is not contemplated. Because we believe, however, that some realignment of these functions would be desirable—if not now, certainly in the future—this step would seem an unwise and unnecessary limitation on the DCI’s authority to design an adequate overall organizational structure for the future, particularly since doing it would require changing present statute.

Options 5B, 5C, and 5D, which would apparently give line control over CIA to the NSC, the Secretary of State or the Secretary of Defense, respectively, while leaving the DCI in command of [less than 1 line [Page 267] not declassified] NSA programs. These variations seem conceptually inconsistent with the thrust of the basic Option 5. They would deny the DCI direct control over the existing CIA production capability in the DDI, and force him to develop a duplicative production organization in order to carry out his most fundamental responsibility—advising the President on foreign developments of interest. As in Options 4C and 4D, it seems likely that CIA’s present focus on national problems would be subsumed to departmental concerns if the Agency were transferred to either State or Defense. We find these options utterly without merit from any reasonable point of view.

Option 5E would disband CIA, moving the analytical components (the DDI) to the DCI’s immediate organization, and moving other CIA elements to other unspecified organizations. If these “other” unspecified organizations are under the DCI’s line control, Option 5E is really Option 6. If they are not, the same problems outlined for Options 5B through 5D apply. We see no point to this option at all; indeed, as written, it does not make logical sense.

Option 6

Option 6 is identical to Option 5 in that it would give the DCI (renamed the DFI) line control over the four national programs but differs from Option 5 in emphasizing management along functional lines.

Option 6A would provide for a DFI, assisted by three Deputies (for National Intelligence Production, Resource Allocation, and Collection), who would in the words of the PRM:

“—Task, allocate resources, and operate an Intelligence Analysis and Production Agency (NIPA) composed of present NIOs and CIADDI; a Clandestine Services Collection/Operations Agency (CIA) composed of present CIADDO and supporting elements of DDS&T; a unified SIGINT Collection Agency (present NSA); an Intelligence Space Support Systems Agency (ISSS) (composed [2½ lines not declassified]”

“—Retain resource allocation and tasking authority over DoD intelligence elements identified as part of the NFIP and review other intelligence elements.” (Comment: This point is oddly phrased. If the DFI has line control over the [less than 1 line not declassified] NSA programs, they become his intelligence elements, not DoD’s, though they would probably continue to be physically housed in Defense, at least for now.)

“—Be responsive to Secretary of Defense needs for timely support from all his elements in crisis and war.” (Comment: How?)

This option places greater emphasis on management by functional lines, stressing continued diversity in analysis by maintaining separate centers while concentrating on reducing redundancy in collection programs. The PRM notes that the ability of the staff supporting the DCI [Page 268] would be critical in ensuring that this greatly centralized structure was properly responsive to the needs of the departments.

Option 6B is identical except that additional DoD elements beyond NSA, [less than 1 line not declassified] would be selectively integrated under DFI control. “In addition to those elements assigned in Option 6A, those elements remaining in DoD which substantially contribute to National Intelligence collection would be integrated into DFI agencies. NIPA would still consist of NIOs and CIADDI, and provide a national intelligence data base accessible to all consumers. Army and Air Force HUMINT activity would be integrated with CIA. Secretary of Defense would manage the Defense Attache System IAW DFI directives.”

  1. Source: Central Intelligence Agency, Community Management Staff, Job 79M00095A: Official Subject Files (1975–1977), Box 4, PRM 11 Task 3 (Vol. III). Confidential.
  2. Reference to Document 41.
  3. June 2. No minutes of this meeting were found.
  4. Printed from a copy that bears this typed signature.
  5. Confidential.
  6. An unidentified hand wrote in the margin adjacent to the first two sentences of this section, “give DCI PRC functions.”
  7. An unidentified hand wrote in the margin adjacent to this sentence, “Bull!”