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Foreign Relations of the United States 1945-1950 Emergence of the Intelligence Establishment Department of State Washington, DC

Founding of the National Intelligence Structure
August 1945 through January 1946

                           

15. Letter From President Truman to Secretary of State Byrnes

Washington, September 20, 1945.

//Source: Public Papers of the Presidents of the United States: Harry S. Truman, 1945, p. 331. On the same date Truman also sent a letter to General Donovan informing him of the signing of Executive Order 9621 and thanking him for his services. (Ibid., p. 330) see the Supplement.

MY DEAR MR. SECRETARY: I have today signed an Executive order which provides for the transfer to the State Department of the functions, personnel, and other resources of the Research and Analysis Branch and the Presentation Branch of the Office of Strategic Services. The order also transfers the remaining activities of the Office of Strategic Services to the War Department and abolishes that Office. These changes become effective October 1, 1945.

The above transfer to the State Department will provide you with resources which we have agreed you will need to aid in the development of our foreign policy, and will assure that pertinent experience accumulated during the war will be preserved and used in meeting the problems of the peace. Those readjustments and reductions which are required in order to gear the transferred activities and resources into State Department operations should be made as soon as practicable.

I particularly desire that you take the lead in developing a comprehensive and coordinated foreign intelligence program for all Federal agencies concerned with that type of activity. This should be done through the creation of an interdepartmental group, heading up under the State Department, which would formulate plans for my approval. This procedure will permit the planning of complete coverage of the foreign intelligence field and the assigning and controlling of operations in such manner that the needs of both the individual agencies and the Government as a whole will be met with maximum effectiveness.

Sincerely yours,

Harry S. Truman/1/

/1/Printed from a copy that bears this typed signature.

16. Memorandum From the Assistant Director for Administrative Management, Bureau of the Budget (Stone) to the Director of the Bureau of the Budget (Smith)

Washington, September 20, 1945.

//Source: National Archives and Records Administration, RG 51, Records of the Office of Management and Budget, Series 39.19, OSS Organization and Functions. No classification marking.

SUBJECT
Attached Letter from Joint Chiefs of Staff Relating to the OSS Executive Order/1/

/1/Not found.

On receipt of this letter I asked Arnold Miles to call General McFarland to tell him that the Order had already been signed. Arnold reminded McFarland that in their discussion it was made clear that the Order was not submitted for formal clearance but for information and for comments if any. Miles also reminded him that the President might sign the order at any time. McFarland agreed this was the case.

McFarland stated that one of the Joint Chiefs raised the question as to whether this was the correct time for this action and instituted a study of the matter for that purpose. McFarland said that the study would be continued and Miles asked that we be kept informed of any matters which required action.

It was made clear to McFarland that the signing of the Order does not freeze the intelligence situation but clears the ground for consideration of the problem in its entirety.

Stone

P.S. Donovan was out of town, so I talked to Louis Ream, his deputy. He took it very calmly and will cooperate in arrangements./2/

/2/The postscript, apparently by Stone, is handwritten.

17. Memorandum From Attorney General Clark to President Truman

Washington, undated.

//Source: National Archives and Records Administration, RG 51, Records of the Office of Management and Budget, Director's Files, Series 39.27, Intelligence. Secret. In a covering memorandum to a slightly different draft of this memorandum, September 21, Hoover told Clark that "it is essential to consummate the Government program upon this subject at the earliest possible date, and accordingly, I believe that any affirmative action which may be taken to advance this program should be taken very promptly." (Ibid., RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents) See the Supplement. The memorandum apparently was not sent to Truman. In October 22 covering letters, Clark sent Smith and Appleby of the Bureau of the Budget copies of this plan. See the Supplement for the October 22 letters. (National Archives and Records Administration, RG 51, Records of the Office of Management and Budget, Director's Files, Series 39.27, Intelligence)

A PLAN FOR U.S. SECRET WORLD-WIDEINTELLIGENCE COVERAGE

Secret world-wide intelligence coverage for the benefit of the United States Government must have as its primary objectives the providing to the executive branches of the Government basic data on a world-wide scale upon which plans may be formulated and action taken, and the insuring of internal security from the threat of infiltrating foreign agents, ideologies, and military conquest. Intelligence coverage must be had immediately. There is no time for training and organizing a new corps.

There is in operation in the Western Hemisphere an intelligence plan based on simplicity of structure and flexibility of operations which has functioned efficiently, secretly, and economically since prior to Pearl Harbor, and has proved its adaptability to world-wide coverage by the effectiveness of its operation in the Western Hemisphere field.

It is proposed that the time-proved program in operation in the Western Hemisphere be extended on a world-wide basis with certain modifications.

The Plan

The plan provides for the joint operation in every country of the world of a service reporting through State Department channels composed of a member from each of the Office of Military Intelligence (military attaché), the Office of Naval Intelligence (naval attache), and the Federal Bureau of Investigation (legal attaché), each as a specialist in its own field and able to operate without a duplication of effort but closely correlating their operations to insure complete coverage.

A committee to control basic policy would be composed of the Secretaries of State, War and Navy and the Attorney General. There would be an operational committee set up by the President composed of an Assistant Secretary of State, the Directors of Military Intelligence, Naval Intelligence and the Federal Bureau of Investigation.

A unit for evaluation and analysis would be established in the State Department to which the three operating agencies would furnish intelligence data and appropriate review, analysis, and utilization in international matters.

Facility of Operation

The program proposed is somewhat similar in operation as that presently operating in the Western Hemisphere. It has proved its effectiveness, requires no elaborate superstructure and the interested agencies have available trained personnel and operating facilities for recruiting, training, and dispatching additional personnel. The plan, consequently, can be placed in operation immediately by the President merely setting up the policy board, creating the evaluation and analysis section in the State Department and then extending the authority heretofore given to the Directors of Military and Naval Intelligence and the Federal Bureau of Investigation for operation in the Western Hemisphere to operate on a world-wide basis.

This plan has produced in the Western Hemisphere a maximum amount of information with a minimum of operating personnel and expense, and has not resulted in any embarrassment whatsoever to the United States Government. Its secrecy is assured through the dissemination of the operations among the already existing Government agencies which have previously operated successfully for a long period in their respective fields.

Points for Consideration

Foreign and domestic civil intelligence are inseparable and constitute one field of operation. The German-American Bund and the Italian Fascist organizations in the United States originated and were directed from abroad. The Communist movement originated in Russia but operates in the United States. To follow these organizations access must be had to their origin and headquarters in foreign countries as well as to their activities in the United States. Every major espionage service has operated on a world-wide basis except that of Britain which has had a separate organization for domestic and foreign intelligence, but Britain is in the process at present of consolidating the two services based on their experiences through the war period. In order to cope with the activities of various subversive agents in the United States with speed and dispatch, it is entirely evident that their activities must be followed throughout the various countries by one intelligence agency of the United States Government. Valuable time, as well as efficiency and effectiveness, is lost if one agency covers their activities in Europe, another in Latin America and another in the United States.

The theory that police work and intelligence coverage cannot be combined has been entirely dispelled. Police arrests under modern police practice is only one of the important functions of a police agency. In fact, all police work specifically involves the gathering of information in the nature of intelligence. Extensive intelligence coverage must necessarily precede the arrest of the enemy agent in the United States and it is not possible to separate the gathering of intelligence from police functions in view of the numerous criminal statutes such as those relating to espionage and sabotage which must be enforced by police action although directly concerned with intelligence. One of the major factors in the control of subversive activities in the Western Hemisphere during the war was the coordination of efforts of the various police organizations throughout the United States and Latin America through the Federal Bureau of Investigation.

A hazard in intelligence operation is the possibility of a charge being made that the organization is a "Gestapo." Also, a police agency which engages in intelligence operation may be called a "political police." Both charges are obnoxious to American citizens. The set-up operating in the Western Hemisphere throughout the war has engaged in both police and intelligence activities and its record of protecting civil liberties has been highly praised even by the American Civil Liberties Union.

Respectfully,/1/

/1/Printed from an unsigned copy.

 

18. Memorandum From G.E. Ramsey, Jr., of the Bureau of the Budget Staff to the Assistant Director for Estimates of the Bureau of the Budget (Martin)

Washington, September 24, 1945.

//Source: National Archives and Records Administration, RG 51, Records of the Office of Management and Budget, Director's Files, Series 39.27, Intelligence. No classification marking.

SUBJECT
Disposition of OSS

Schwarzwalder, Cooper and I spent the better part of Saturday morning/1/ with General Donovan and his top staff discussing problems incident to the disposition of OSS.

/1/September 22.

Donovan and his staff had read into the executive order/2/ the abolishment of all of the positions that were organizationally associated with the Director's office and had concluded that their connections with the outfit would terminate October 1. Our assurance that the order only related to the legal entity of the Office of the Director and not to individual positions, except that of the Director, was not too reassuring. We are taking steps to get a further clarification of this as it would be undesirable for all of the key people to leave on October 1.

/2/E.O. 9621 of September 20; Document 14.

It is entirely possible that Donovan's interpretation of the order was for the purpose of introducing a confusing issue at the opening of our discussion as he makes it abundantly clear that, in his opinion, the order is a mistake and that the Director of the Bureau of the Budget has made a decision without full knowledge of the facts involved. Although he says that he has talked to Snyder and Rosenman about the intelligence problem it is evident that he fixes the responsibility of the recent executive order on the Bureau.

He states that the termination date of October 1 is evidence of our lack of understanding of the real problems involved. With respect to the date he has a point. Aside from the short time allowed for taking care of the actual mechanics of the switch there is much to be said in giving Donovan an opportunity to remove certain individuals who have been working under special "cover" arranged by Donovan. There appear to be several other human relation problems incident to demobilization of some of the units which should be handled with care. Through an oversight the effective date of the Executive Order was not changed as the issuance of the order was delayed and instead of allowing from three to four weeks for the transfer as the earlier drafts would have done the order as issued allowed only ten days. Since we still have (at 9 a.m., September 24) to establish or firm up the points of contact in the State and War Departments for taking over the parts of OSS to be transferred our problem is further aggravated. Lawton has suggested that the War Department might continue Donovan in charge of the part of OSS transferred to it for an interim period and this seems to be a desirable thing to do notwithstanding the fact that Donovan will continue to agitate for a centralized intelligence agency.

Lawton's reaction was passed to Don Stone yesterday and Don expects to discuss this problem further with McCloy this morning and perhaps suggest that Donovan or General Magruder, Donovan's assist-ant, be continued to give continuity.

It is equally important to announce the appointment of the person who is to handle the parts to be transferred to the State Department. Unless these two areas are clarified promptly it would seem highly desirable to extend the termination date of OSS to at least October 15.

 

19. Memorandum From the Director of the Federal Bureau of Investigation (Hoover) to Attorney General Clark

Washington, September 27, 1945.

//Source: National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents. Personal and Confidential.

I learned last night that Colonel Alfred McCormack has been assigned to the State Department for the purpose of forming a World-wide Intelligence organization. This information is confirmed by a news story appearing in this morning's Washington Post, a copy of which I am attaching hereto for your convenience./1/ I have reason to believe that the information contained in this newspaper article is accurate, and, in addition, I am advised that Colonel McCormack will have the complete determination as to the nature of the World-wide Intelligence organization to be set up, the scope of its operations and all other details with reference thereto. According to my source of information, Colonel McCormack's views will be approved by the Bureau of the Budget. Colonel McCormack will be released from the Army in the immediate future and will have a civilian status in the State Department where he will first set up an interim intelligence organization, which will be replaced around the first of the year by a permanent organization. By way of background, it may be noted that Colonel McCormack was formerly associated in the practice of law with Assistant Secretary of War J.J. McCloy. I am not at all optimistic as to the sympathy which Colonel McCormack may have toward our program.

/1/Not printed.

I think that the announcement of Colonel McCormack's appointment clearly indicates that the World-wide Intelligence Service will be operated by and as a State Department project. I think, consequently, that it would be well if you have not already done so, to bring to President Truman's attention in the immediate future our views as to the most desirable way to establish the World-wide Intelligence Service.

Respectfully,

J. Edgar Hoover

 

20. Letter From Secretary of War Patterson and Secretary of the Navy Forrestal to Secretary of State Byrnes

Washington, September 29, 1945.

//Source: Central Intelligence Agency Historical Files, HS/HC-802, Item 9. Top Secret.

DEAR MR. SECRETARY: During the war the Army and Navy have given continuing thought to the problem of how best to serve the national interests in the field of intelligence in peacetime.

The Joint Chiefs of Staff, after extended consideration, have submitted their conclusions on the matter to the Secretaries of War and the Navy for transmission direct to the President. In view of the Executive Order of 20 September which terminated the Office of Strategic Services, and the President's letter of the same date which charged the Secretary of State with taking the lead in developing a comprehensive and coordinated foreign intelligence program for all Federal agencies concerned with that type of activity, the Secretaries of War and Navy have decided to transmit the recommendations of the Joint Chiefs of Staff herewith to the State Department./1/ It is assumed that you will transmit these recommendations to the President for his information.

/1/See Document 13.

Sincerely yours,

Robert P. Patterson/2/
James Forrestal

/2/Printed from a copy that bears these typed signatures.

21. Memorandum From the Director of the Strategic Services Unit of the Department of War (Magruder) to the Assistant Chief of Staff for Military Intelligence, War Department General Staff (Bissell), the Acting Director of Naval Intelligence (Inglis), and the Secretary of State's Special Assistant for Research and Intelligence (McCormack)

Washington, October 1, 1945.

//Source: Central Intelligence Agency Historical Files, HS/HC-135. No classification marking.

1. I wish to propose the immediate establishment of an informal interim committee to effect liaison as well as to discuss and prepare recommendations with respect to cooperation in intelligence matters within our respective authorities arising from the implementation of the Executive Order dated 20 September 1945.

2. The purpose of this informal committee is to effect immediate coordinated working arrangements within the spirit of the Executive Order and the President's letter to the Secretary of State dated 20 September 1945.

3. I should appreciate an early expression of your views in this letter and, if you agree, the designation of a representative to meet as soon as practicable.

John Magruder/1/
Brigadier General, USA

/1/Printed from a copy that bears this typed signature.

22. Memorandum From Morton B. Chiles of the Federal Bureau of Investigation to the Director (Hoover)

Washington, October 2, 1945.

//Source: National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents. No classification marking.

This morning I visited President Truman for approximately 35 minutes at which time we discussed thoroughly the Bureau's participation in World Wide Intelligence in the Western Hemisphere and the advisability of expanding the Bureau's jurisdiction to world wide coverage.

Mr. Truman requested me, after World Wide Intelligence was mentioned to familiarize him with the Bureau's activities in this field and the reasons the Bureau should continue in these operations on a world wide basis. I had the opportunity to fully explain to him the Bureau's plan, the Bureau's method of operation and all of the reasons why the Bureau should expand to coverage of the world. Mr. Truman during the course of this conversation asked me questions and appeared to be most interested in gaining a complete picture of the intelligence operations. He agreed that there could be no satisfactory separation in the handling of domestic intelligence and foreign intelligence. He expressed concern regarding the possibility that a World Wide Intelligence organization would gain the reputation of a "Gestapo." Concerning this, the Bureau's reputation and experience in the handling of intelligence matters during the past several years without such incident were explained to him.

The President stated that he had been seriously considering a World Wide Intelligence organization the past few days and that he intended to make some decision in this matter in the immediate future. He indicated that he had in mind some type of intelligence agency that would report to and be responsible directly to the White House. Mr. Truman commented that he was shocked at the amount of "crookedness" prevalent in public office at the present time, but did not elaborate on this.

I suggested to the President that prior to the making of a definite decision that he consider conferring with you. He appeared pleased with this suggestion and stated that should he desire further information concerning the organization to handle World Wide Intelligence he would call upon you.

The President during this interview, which was spent in part in discussing our families and other matters of mutual interest, displayed a most congenial attitude toward the Bureau and stated that he felt that it was the most efficient organization in Government service.

It may be of interest to you to know that I arrived at the White House approximately 20 minutes early for my appointment, and Mr. Truman came immediately to the Reception Room and escorted me to his office which afforded us more time for the interview.

23. Memorandum From the Secretary of State's Special Assistant for Research and Intelligence (McCormack) to the Director of the Strategic Services Unit, Department of War (Magruder)

Washington, October 4, 1945.

//Source: Central Intelligence Agency Historical Files, HS/HC-135. No classification marking. Copies were sent to Stone, Inglis, and Bissell.

1. Your memorandum of 1 October, addressed to the A.C. of S., G-2, the Acting Director of Naval Intelligence and myself,/1/ is acknowledged. In accordance with our oral discussions I think that liaison is necessary in order that the activities and administration of the Interim Research and Intelligence Service may be coordinated with the activities of the organizations under you. Such coordination is a temporary problem relating to the period between now and the end of the year.

/1/Document 21. Replies by General Bissell and Commodore Inglis both October 4, are ibid. See the Supplement. (Central Intelligence Agency Historical Files, HS/HC-135)

2. Your letter, however, appears to contemplate a committee which will function in lieu of the interdepartmental group provided for in the President's letter of 20 September 1945 to the Secretary of State. That does not seem to me to be in order. The President's letter 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 . . . through the creation of an inter-departmental group, heading up under the State Department...." It is my view that the Secretary of State, as a first step in the development of a government-wide intelligence program, must develop the State Department's intelligence program. As you know, only the preliminary moves have been made toward such a program by the Department.

3. In the development of such a program the first problem affecting the War Department relates to that part of the 20 September 1945 Executive Order which provides for transfer to the State Department, in addition to the Research and Analysis Branch and the Presentation Branch, of those other functions of the former OSS which, as determined by the Director of the Bureau of the Budget, relate to the functions of the R & A Branch and the Presentation Branch. In the ten-day period between the issuance and the effective date of the Executive Order, the Bureau of the Budget was unable to make a determination as to what other functions of the OSS were related to those of the R & A and Presentation Branches, and therefore the transfer of such other functions, if any, was postponed and only the two named Branches were transferred.

4. Investigation may reveal that some activities transferred to the War Department would more appropriately be performed in the Department of State. In addition, many problems have been created by the manner in which the OSS organization was split, notably those growing out of the transfer to the War Department of the entire Administrative Serv-ice organization.

5. I agree with you that it would be helpful to appoint liaison officers to function on such matters and on the matters referred to in paragraph 1 above; and as soon as I get a staff I will appoint a liaison officer.

6. Offhand, however, I see no reason for a liaison committee. MIS and DNI should be consulted on all problems which affect them, but most of the problems between the respective heirs of the former OSS are administrative and of no interest to the military intelligence units of the services. Unless you have something in mind that does not appear from your letter, my preference is to conduct liaison directly with G-2, MIS and DNI.

7. With respect to the creation of a group to function on the problem of a government-wide intelligence program, I anticipate that the Secretary of State will initiate action in that direction in due time.

Alfred McCormack/2/

/2/Printed from a copy that bears this typed signature.

24. Memorandum From the Director's Assistant (Tamm) to the Director of the Federal Bureau of Investigation (Hoover)

Washington, October 4, 1945.

//Source: National Archives and Records Administration, RG 263, Records of the Central Intelligence Agency, Troy Papers, FBI Documents. No classification marking.

I think that your apprehension about the form the World-wide Intelligence Service will take is well-founded, in view of the inclination in the attached memorandum that "Departmental" activity will be continued./1/ I think that if the final die is cast in line with what we recognize as the General Donovan plan in this program, we should still try to get out of this mess./2/

/1/Not further identified.

/2/The words "we should still try to get out of this mess" have been underlined in the source text, and directly below, apparently in Hoover's hand, is written: "I most certainly agree. H."

Respectfully,

Edw

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