Transcript of 157-10014-10125.pdf
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157-10014-10125] 2025 RELEASE UNDER THE PRESIDENT JOHN F_ KENNEDY ASSASSINATION RECORDS ACT OF 1992
JFK Assassmation System Date: 77772015
Identification Form
Agency Information
AGENCY SSCIA
RECORD NUMBER 157-10014-10125
RECORD SERIES MISCELLANEOUS RECORDS OF THE CHURCH COMMITTTEE
AGENCY FILE NUMER 07-M-3]
Document Information
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FROM:
TO
TITLE :
DATE : 03/10/1976
PAGES 78
SUBJECTS
SSCSGO, METHODOLOGY
COMMITTEE BUSINESS
DOCUMENT TYPE TRANSCRIPT
CLASSIFICATION Declassified
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CURRENT STATUS Redact
DATE OF LAST REVEW 03/22/2000
OPENING CRITERIA
COMMNTS : CCBOX 324
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Date 08 / 07 /95
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JFK ASSASSINATION SYSTEM
IDENTIFICATION FORM
AGENCY INFORMATION
AGENCY SSCIA
RECORD NUMBER 157-10014-10125
RECORDS SERIES MISCELLANEOUS RECORDS OF THE CHURCH COMITTTEE
AGENCY FILE NUMBER 07-M-31
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DOCUMENT INFORMATION
ORIGINATOR SSCIA
FROM
TO
TITLE
DATE 03/10/76
PAGES 78
SUBJECTS sSCSGO , METHODOLOGY
COMMITTEE BUSINESS
DOCUMENT TYPE TRANSCRIPT
CLASSIFICATION TOP SECRET
RESTRICTIONS REFERRED
CURRENT STATUS POSTPONED IN FULL
DATE OF LAST REVIEW 01/05/99
OPENING CRITERIA
COMMENTS CCBOX 324
[R] ITEM IS RESTRICTED
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NATIONAL ?'SECURTTY- INEORMNZOV ToP
Unauthorized: Disclosure: Subjecg
Vol:: 2 OE 3;
to; Crininal Sanctions_
R3229
@ljr- Iutitrpe StatcE Srnate
Report: of Proceedinga
Hearing? held belore
Senate: Select Comnittee to: Study Governmental
Operations: With: Respect:: to Intelligence Activities
Wednesdayn: Marchi 103 19576
Washington; D:_
(Stenotype: and Waste- turned Cer
to;the: Comittee ' for: deatruction)
WARD & PAUL
410: FIRST STREET;83E
WASHINGTON; D C: 20003
(202) 544-6000
TOP SECRET
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1 FOREIGN AND MILITARY SUBCOMMITTEE MEETING
2:
3 Wednesday , March 10 , 1976
4
5
United States Senate
6 Select Committee to Study Governnental
7
Operations with Respect to
8
Intelligence Activities,
9 Washington ,
Da C_
10 The Committee met, pursuant to notice, at 2.45 0 'clock
11 P.M . , in Room S-407 , the' Capitol
0
the Honorable Walter De
12 Huddleston presiding .
13 Present: Senators Huddleston (presiding) , Hart of
14 Colorado and Mathias .
15' Staff: William G . Miller_
0
Staff Director, and David
16 Aaron
0
Joseph diGenova , Lynn Davis
0
William Bader , Elizabeth
17 Culbreath Charles ,Kirbow Rick Inderfurth
0 Pat Shea
#
Elliot
18 Maxwell and Al Quanbeck _
0
Professional Staff Members ,
19
20
21
22
23
24
25
Tea d CpeDpt
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And then the question is whether or not there is a prohi-:
2.
bition on printing in the English language .
3 Mr Bader And as I heard the consensus this morning =
8
4 we would not move to that recommendation for a prohibition.
5
I did_not hear whether on the distribution this would be by
law , though I took it it wag to be by law, though I can be
correctea on that. I don't think we addressed that this morning
Mr Kirbow Mr _ Chairman, on these that we considered
to be rather
00 that we have a
fairly light record
on or that
We are not too sure what the future holds , one of the members
10
that I rode over with on the car suggested that perhaps in those
11
instances we coula recommend fairly strongly whatever We want 12
the followon people to do to ensure that the reconmendation
13
does not create havoc within the Agency or does not leave the
14
rights of citizens unprotected _
15
But that is not a cop' out. It is sone thing that you 16
frequently do
0
say , let us reserve this for the permanent
17
oversight committee or for whatever Other group . We may have
18
all the information we neea
19
Senator Huddleston Let then make the determination whether
20
or not it-Bhould be a statute.
21
Mr Kirbow Determine whether in the law whether it is
22
working all right under the set of regulations _
23
Mr' Bader Mr _ Chairman
0
'may I say in this instance in
24
the publishing trade there is no lack of record? The evidence
25
T 0 CreDfT
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1 2 Ble € E E @ [ N G 8
2 Senator Huddleston I call the Committee to order
3 Mr Aaron _ I believe Bill Bader had the temerity: to
4 sumarize where we stand
5 Mr _ Bader _ Mr Chairman, where I think we are at the
monent is, taking the three major issues before the Subcommittee
in the order were presented
0
and discugsed this morning
0
the first being the academic issue
0
and a3 I heard the Subcom-
mittee this morning , then I will have another go at the
10 options
#
give enough optiong in the option paper and bring- it
11 back before the Committee for a further look before we go Qn
12 Senator Huddleston By Friday .
13 Mr . Bader By Friday, without question
14 I think by this tine we will all have 8 we will try to
15 include a positive. optien, that i8 to.say , to-approve if not
16
applaud . the .expanded efforts .of FRD to . undertake these activi-
17 tles, Or at least to, endorse them
18 NOw , going to the second was the covert use of books and
19 publishing houses We discussed two recommendations : one which
20 I believe here the Committee has agreea to , and that is a
21
prohibition
on the distribution or
subsidy of any books
22 magazines or
other publications not attributed' to the CIA in-
23 side the United States
24 Senator Huddleston I think we can all accept that, can 't
25 we
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and inquiry into i6 hag been thorough , and I think we know this
2 well There is no dispute from the Agency .
3 Senator Huddleston Weil, is the law incongistent with
the statute 'on- the information service?
5 Mr Bader It is the sane .thing _ I would reconmend
0
6 Mr Chairman e
8
that this: woula be by law, by statute.
7 Senator Huddleston On the publication .
8 Mr Bader On the publicationa
9 Senator Mathias . woula support that
10 Senator Huddleston I think Gary Hart would also , S0 I
11 think we will make that recommendation, that this one on the
12 academics is the one we are not sure of .
13 Mr Bader That-8 the one we would go forward with , and
14 now we are moving to I woula al8o reiterate that in our
15 session the other night I took it a8 agreement that the
16 recommendation by statute the CIA should be prohibited from
17
making operational
ube of all educational and cultural
18 grantees of all U,S Government sponsorea programs , this was the
19 issue " which was raised Of government funded programs such as
20 the Fulbrigbt program
21 Senator Huddleston And that' : either already a regulation
22 Or a directive or
something to that effecta
23 Mr _ Aaron . Certain categories.
24 Mr _ Bader Certain categories
25 Mr Kirbow . That is brand new ground
Tem cpeDft
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5
1 diGenova The John McCloy exceptions to that rule, they
2 are the only Ones that are protected_
3 Mr Aaron That justifies Charles view that there are
some similarities between Ford Foundation and , Government
5 sponsored activities.
6 Mr Bader . Where our discussion was left before lunch
was on the question of the covert use of U.'S. journalists and
media institutions
0
and as it was laid out, it was indicated
9 that the CIA S intended internal prohibition
on the use of the
10 media extended to the internal prohibitions On the use, Opera?
11 tional uge Of individuals , American and foreign , who were
12
accredited to American media: organizations
13 Ag I heard it this morning, what We were digcussing and
14
moving to was to extena that prohibition to cover all American
15
individuals' and media organizations , and that the question then
16 wag whether this would be recommended to be something done in
17 law or a recommendation, Or an insistence, if you will, to the
18 Agency that it further amena its internal directives, its
19
50-10 , to put all media personnel
#
American media personnel on
20 the prohibited list, and that i3 I think where we were
21
Senator Huddleston. I think that' s an accurate statement.
22 That 8 where we were
23. I had expressed a thought that I thought that it ought to
24
be expanded to include all
0
but we should hola off on the
25 statute business for the time being.
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1 Senator Mathias. My role here seems to be the Devil'$
2 advocate _
3 Senator Huddleston_ Good
Senator Mathias. There is no question about the writing
5 American press or the value in print domestically . Maybe the
role, any legitimate role that news men could, journalists,
writers could fulfill is available. through the information
agencies, USIA and groups of that sort.
So does anybody know whether there is any real need
10 for allowing
some latitude, which is not covered situations
11 that can be envisioned under USIA or- other programs?
12 Mr Kirbow Well , Senator
0
the one that I discussed earlier
13 that I probably didn t make my point well because no one
14 seemed to have picked it uP, is we do ; by the words here , if I
15 understand Mr Bader prohibit an American citizen living in
16 Brussels and working for a local newspaper there from having
17 anything to do with the CIA
18 Senator Huddleston No we don t, do we?
19 You mean his extension?
20 Mr Kirbow Yes , sir
21 Senator Huddleston But not by
22 Mr . Kirbow. But wasn'+ that; what you wanted to put in
23 the law , that you didn t know if you wanted
24 Senator Mathias This is the point I wanted to raise
25 here _
7e5 cpapFT
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Mr . Kirbow_ That kind of relationship is something that
2 W0 should away from because I don 0 t see any harm in it,
3 nor do I think the record demonstrates any harm in it. I don 't
see #rr Rr# I don t know how in the worla this person doing that
taints the-minds of the American reading public, which i
apparently what you are trying
## you re not trying to-protect
the newsman You are trying to protect the reader who doesn t
know that what he S getting is being spoonfed to him from the
CIA_
0
and I don 't know we would be 30 concerned about
10 protecting newsmen from working, or prohibiting them fron
11 working, because I think they have a right to do that a3
12 American citizens , just as they do to work with the Department
13 of Defense or any other agency
14 Mr _ Bader You would then rescind the Agency 8 standing
15 prohibition?
16 Mr Kirbow I just don t think you ever prohibit it in
17 law
18 Mr diGenova Are you talking bout an affiliated_
0
19 accredited journalist, because that 5 what the Agency regulation
20 deals with. It doesn t deal with an American citizen . It
21 deals with an accredited person , whether he is a
foreign
22 national or an American
23 Mr_ Bader To an American media organization.
24 Mr diGenova But that S not the example Charles gave
25 you
Tam ceeDtt
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1_
Mr _ Kirbow _ Well perhaps I misunderstand the extension
2
that you , your full recommendation
3
Do you want to go beyond where the administration is in
4
their position?
5
Mr Bader . I am recommending to go beyona where the
Administration is at this stage, to extend the operational
prohibition on hthe part of CIA to use American
5 #rr Americans in
the media
Mr Kirbow Wherever locatea
9
Mr _ Bader Where they are ubing them undercover , at this
10
stage, to the extent that it i8 a Cover propobition
11
Senator Huddleston . Even if they are
in foreign media?
12
Mr_ Bader . Yes,. sir.
13
Senator Huddleston And even though all of their
14
activities are related to foreign; they are not writing for
15
American news gervices
16
Mra Bader Alternately;' they could be with American
17
media organizations
18
Mr Kirbow_ Mr Chairman, I don t think there is a single
19
shred of evidence on our record that that i8 in any way wrong-
20
doing or in any way' adversely affects the rights of American
21
citizens Clearly it will prohibit or
could prohibit in the
22
future the proper use of an individual that could be essential
23
to the intelligence collection processes f the CIA , and it
24
singles out a
specific agency- which is not doing any harm to-
25
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the American citizenry , and says no, you cannot do this because
2 you happen to be_ a secret organization.
3 Senator Mathias. If I wanted to. do Charlie, I think
I could work out a schene I would hire a prominent American
columnist to go ana live in Paris, as Art Buchwala did
#
for
example.
Mr Kirbow_ And to pick off his colunns ana run then
in the New York Times
9 Senator Mathias_ And run them in the Paris Trib first:
10 and then let the domestic" press pick hin up .
11 Mr Kirbow. But if he ' 9 in the Paris Trib, that 8 ar
12 affiliated U.S .
13 Mr Aaron . Well, suppose he writes for the Financial
14 Times?
15 Senator Mathias We1l
0
you coula work out an echo program
16
if. you wanted
17
Senator Hudaleston Well, the basic point:; ingtead
18
of picking instances
0
it seems to ' me, is whether or not 28 an
19
official policy of the United States Government we want an
20
institution such a3 the press with all it means and all it is
21
supposea to be in American with its constitutional provisions and
22 whatever
0
to be subverted to the secret, clandestine operation
23 that it can; Anytime we put any prohibition anywhere , We are
24
eliminating . somebody a3 a potential agent _ You can t use
25 that 23 a
guideline.
4 05
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1 Mr . Kirbow_ These People are not necessarily subverted _
2 Senator Huddleston I'm talking about the institution of
3 the free press being subverted
0
not the individual
4 Mr . Kirbow _ I 11 extend that one further_ I don' € see
how using, them for cover which ha8 _ no direct effect, like the
6
example I guess You gave Senator, of a vice president of a
bureau of bone sort who hag nothing
to do. with the' writing Or
editing or anything; he is the business head of the operation
9
just like any other corporation This thing extends to that .
10 Senator Huddleston . He may have something do with the
11 selection of the people who do write
12 Mr Kirbow. Well, Lf you could give us an abuse that we
13 are trying to correct, Or some reabon for it?
Mr Bader It $ not a question of abuse , it' $ a guestion
14
15 of the use;, the operational use of an institution such as_
16
the press for operational purposes .
17 Mr Kirbow Well,. explain then , and perhaps I'm going
18
explain the sanctity of_ the press if it i8 not to protect an
19
uninformed reader from having his mind tainted by the relation-
20
ship. What is the sanctity of the press 88 an organization?
It i8 not sanctity like the church and state. I just don
21
22 gee the recora for this_
Senator Huddleston Well , the clergy and the pregs I think
23
are institutions
24
Mr Kirbow_ Well, I think the: clergy and maybe the
25
7en y ceeDe?
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academic , like you say , that teaches the student directly,
2 but a businessman who happeng to have elected going into the
business of running
a newbpaper Or a magazine
0
to be singled
out and say you as a patriotic American are proscribed against
5
doing any business , and if You are going to do it with an agency]
you should do it with the whole United States_ Covernment . I
don see how we can single out the CIA and not single out
military Or FBI .
9 Mr Aaron Well, I think the domestic group will have
10 may well have- some ; recommendations regarding the FBI 8 covert
11 use of American media
12 Mr & Kirbow Well
$
domestic media
0
obviously.
13 Mr Aaron I would like to say , to take Charles'
14 example of an American working for a
foreign press , and what
15 the problem is. I think the problem: is that you have two
16 kinds of problems with the press, One is. the fact, if it i8
17
operating domestically, if it i9. working for American media
18 institutions , it is clear that they are subject Co Some
19
manipulation or at_ least questionable manipulation, and there
20 are issue8 in people' 9 minds a3 to its integrity.
21 Now , the question goes beyond that to what about people
22 who might be working for some
foreign
# American journalists ,
23 American writers or what have you, working for foreign media
24 institutions There you have a somewhat more: extended
25. situation. But it seems to Me that What you have is the
TOD crpDf
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12
possibility of the American press getting discredited
0
having
2 problems of being able to' perform its normal functions in the
worla and performing in the United States because it is part
4 of a clandeetine intelligence organization
5 Mr Kirbow Don t you think that' $ an individual right
that a person has the right to exercise both ways , instead of
one way?
Mr Aaron Charles , what I think I have told the
Committee, I have a real problem with the concept of the
10
American people having the . right to spY , somehow , and these
11
prohibitions don t go to ,what people are allowed to do on
12 the outseta They go to What the Government is allowed to do
13 Mr _ Maxwell _ Well, let' 5 take a different kind of
14 example.
15 What would happen if in some way and it' s,not, I think,
16 impossible to imagine an American citizen was writing full
17 time for the Communist Party paper in Italy Or Portugal or
18 France .
19 Now that obviously would be covered' by the example that
20 Bill has provided as a prohibition.
21 There are two questions_ One is whether the person has
22 any real operational use that you want to preserve_
0
and second ,
23 whether it goes to the question that David presents
0
which is
24 the possible contamination of the American press,. which seems
25
a difficult extension in that example_
0 as well as the possibilit
To cepDfT
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1 of distortion
0
the flowback problem in America .
2 And the second problem seems to be, with an' example like
3 that, is that it seems to there: is, very little stock in the
4 argument , because the argument about distortion of what goes
on
in foreign countries and people S perceptions is at the heart
of the question of whether the CIA or any government agency
should be engaged in- propaganda because it is quite possible
the' propaganda gets picked up in the same way and the question
is obviously of line drawing: how do you want to draw the
10 line.
11 It strikes me that there may be better ways
to draw te
12 line than the suggested prohibition that Bill has for any
13 Anerican , regardless of status, or who write for or what
14 they are doing.
15 Mr Kirbow By having citizenship
a3 an American
16 Mr Bader Well
8 you misunderstood me I was putting out
17 the . various posgibilities
18 Let 8 turn to the text for just a moment and maybe that
19
will help.
20 First turn to 61 _ Lets try to get some idea of what the
21
probiem is before we get to the semantics .of it. All right,
22 just let Me go through this , then we 11 see what is actually_
23
being recommended here.
24 I have confused you obviously , by giving a series of
25 possibilities ; not what the recommendations are
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1` "Ten U.S, news organizations and five U.S _ publishing
2 houses provide cover for CIA agents abroad . Four of the
3 organizations do not know that, they provide this cover 0 "
4 Then there are some examples _
5
Mr Kirbaw Meaning management: or individual?
6 Mr . Bader Management .
7
Mr Kirbow At any level _
8
Mr _ Bader At any level
9 Mr . Kirbow. All right
10 Mr , Bader . Then there are bome examples of the kinds of
11 relationships that the CIA officer engages in: intelligenc
12 collection under cover a3 a
roving international news corres-
13 pondent , a CIA officer under cover a3 a European representative
14 of an American company
While working a8 a
stringer for a
15 United States publication engages in intelligence collection
16 and covert action . In this case the company i8 aware of the
17 CIA relationship while the publication is not . Bona fide
18 journalists who regularly provide the CIA with intelligence,
19 Ene are
paid regularly while others are not In one case
20' the journalist is apparently not aware that the U.S :. embassy'
21 official to whon he is providing information ig actually a
22 CIA officer
23 , Now , what the recommendation here on 64 , or the bracketed
24 recommendations 4 and VI m sorry I created this situation
25 by giving- various options by statute the CIA should be
Tod cfedeT
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15
prohibited from using American media organizations for
2 cover . That ig the extert of ita
3 What is the trouble Joe?
4 Mr . diGenova That seemg to be somewhat that Seems
5 to. be a back-off from what the Agency prohibits a3, well_ I mean
do you want to make a recommendation saying that the Agency" 8
prohibition against using Americans who are accredited
Mr . Bader No .
This is the additive. The recommendation here is to
10 take the Agency 8 prohibitiong which go to the question of
11 American and foreign journalists_
0
accredited to American
12 media organizations
#
and extend it to what is not covered under
13 those prohibitions
#
which is the use of thege American media
14 organizations for cover purposes
15 Mr Maxwell Ig it clear that people who are in media
16 organizatione are not accredited to those organizations?
17 Mr. Aaron . If they were, then` they would be covered:
18 If they are accredited journalists
0
then they would not.
19 Mr = Maxwell- So the issue is whether individualg who
20 don' & write
21 Mr Aaron . But may edit.
22 Mc Maxwell But may edit.
23 Ms Culbreath. Or may type it up.
24 Mr = Aaron Or may type it UP .
25. Mr Kirbow . Well
0
is this the same point that we re
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16
1 talking about less than 25 people, where you are going to make
2 a statutory prohibition against use of all people in that
3 Category because On pagel 61 it says ,. "of the 65 Americans
employed' by the CIA in the media field, only a little over
one thira are journalists; another third are CIA agents operat=
under media cover , and the remaining individuals are either
employed as CIA media proprietaries abroad or are propaganda
writerg and consultants
So we are
really talking about making
a major-prohibition
10 against
a segment of ourk society where at the present time there
11 i8 less than 25 people who have any direct contact with ths
12 reading mind, apparently
13 Senator Hart of Colordado . I think, Charlie, it's called
14 a principle. If it was only one person, you ve still got the
15 problem _ I don t think 'it i8 the quantity.
16 Ms Davis . Bill, in your examples on 61 , the first one
17 at the bottom, would that now be covered under your prohibitiond
18' CIA officer engages in intelligence collection under cover 28 a
19
roving international news correspondent?
20 Mr Bader I can t remember from the text here whether
21 the Man is accredited or} not .
22 If he is accredited it would be covered _
23 Ms Davis If not he is not additionally covered by your
24
prohibition
25 Senator Huddleston This does not extend to the example
TaD CredeT
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17
that you gave
8
Charlie.
2 Mr _ Kirbow_ No , ir} it doesn t here
3 Mr Bader . Only if ne is affiliated with that group .
Mr Kirbow . His affiliation covers anybody: who is an
American citizen is forever and hereafter woula be prohibited,
6 it goes into the statute from dealing _
Mr diGenova_ That 3 one of the possibilities _
8 Mr _ Kirbow. That 8 one of those recommendations based
on investigation .
10 Mr Bader . I wasn € recommending that I wab saying that
11 was one of the possibilities of the whole list.
12 Senator Huddleston But the recommendation at the top
13 of 64 doesn t cover an American citizen who is using the
14
foreign media
as Cover
15 Mr . Bader This_ would not cover an American citizen who
16
i8, let 9 say , is working for Stompe , Or Le Monde, and .who is
17 not accredited and at the same time is not accredited to
18 an American media organization
19 It does not cover an American citizen who is a
stringer to
20
a' Latin Anerican newspaper unless he is accredited to an Americdn
21
media ' organization _
22 Mr Kirbow, Let me try one more time , then; to state the
23
position of not Senator Tower in this case, but another Senator
24 28 I indicated ; spoke to me on this very subject,and indicate
25 to you that we not do to harm Or to prevent the use by the
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19
agency of certain people unles8 in some way that use affects
2 the rights and/or in some vague way affects the mental processes
3 to the detriment of the American citizenry =
0
that we don €
4 concern ourselves with passing laws to protect the Person who
5 reads sone thing that thege people do. If you do: this, you open
that can of worms which gets you into a prohibition against
any
work in the press Or elsewhere in a propaganda fashion
Now the Committee may decide that propaganda is in fact
some thing that we should prohibit by law
8
but doing this
10
piecemeal like this , it does just exactly that . I See nothing
11 in our record that indicates that the use of certain of thege
12_
people overseas or for cover in any way
01 0 there is not
13 any evidence that it -hag.adversely affected the rights of the
14 citizens of the United States . There is; a potential for
15 abuse in' practically anything secret and covert.
16 Senator Huddleston . I don t believe the recommendation
17 at the top of page 64 violates what you have just said
18 Mr . Maxwell I would not think that
19 Mr . Kirbowa Well, it say8 , Mr Chairman
#
that by statute,
20 by statute, which means by law the CIA should be prohibited'
21
from uging American,media organizations for cover We apparently
22 have 65 people, a
portion of which are being used for cover
0
23 and apparently they consider them to be an essential asset , or
24
they wouldn t be using then
25 Is that correct, Mr , Bader?
7ea 5 efepFe
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1 Mr . Bader _ The CIA?
2 Mr - Kirbow Yes
3 Mr : Bader I would as8ue that they woula have extended
their prohibition to this , or on the other hand one could argue
5 I 'don : know what their motives" were It could have been
felt that this
#
the first step they took was the one that was
dealing with what the public was demanding -
Mr Kirbow_ Well, I really don t see anything in our
record or any evidence that they have given 48 or anything
10 other than a staff position on this which we are trying to
11 sell the Committee that this is 3 harmful procedure_
12 Senator Huddleston . What this does i8 extends: beyond
13 the practice of journalists to any other person be it an
14 executive or clerk or typist Or whatever, on the assumption
15 that you can t be a little bit pregnant If the agency is
16 going to be subverted anywhere , not the agency , if the insti-
17 tution of the press is, that it is going to be subverted
18 Mr. Bader _ Chairman , the Agency has accepted the
19
bagic principle, because it has removed from its list of
20
operational assets a rather larger nuber than this would
21 call for_
22 Mr Kirbow , But if I hear correctly what you are saying
23 ther , we are out to- protect the American media from being. made
24 pregnant by the CIA and not worrying at- all about the reading
25 public or the other but just the media
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Senator Huddleston _ The assuption is if the media of
2 the press is subverted , that it will affect the citizens_
0 or
3 they will' suffer:
4 Senator Hart of Colorado Mr Chairman , in the interest
5 of expedition, I move the passage of these three recommendations
6 Senator Huddleston All right_ Iet' 8 see what the three
are.
Mr Aaron . Well, let me summarize the first one . I think
we have agreed the first is that the prohibition on- distribu-
10 tion of CIA funded ; supported, subsidized and S0 forth, that
11 that be prohibited' within the United States .
12_ Mr , Inderfurth- Printed _
13 Mr _ Kirbow_ Excuse me #
Not printed_
14 Mr . Aaron . The word 96 'printed" 'dropped out for the following
15. reason One , it makes it easier to prohibit-the distribution
16 if you don identify where the printing i8 taking' place , and
17 secondly, while there is no printing going on here , the
18
question really goes to distribution. I think that was the
19 concurrence of the Conmittee.
20 The second point i8 that the prohibitions of 0
that the
21 Agency now has upon itself
8
be made law.
22 Mr diGenova On the use of media personnel and
23 institutions?
24 Mr Aaron On the use of media personnel and institutions
25 ana the third point is that it be extended to say by statute
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1
the CIA shoula be prohibited from uging
American media organiza
2 tions for cover
5 Senator Huddleston Well , the style of this: ought to
be changed _ it seems to me , because one of the recommendations ,
instead :of listed under recommendations , is the last paragraph
6 on is that correct?
Mr Aaron Yes , that woula be picked up a3 3 recommenda -
tion , that is correct.'
9 Mr . diGenova _ Plus the other one,` Which is not on 64 .
10 Mr . Aaron . Well, the one on 64 , the bottom one cones out.
end la
11
Senator Huddleston _ Right .
begin lb
12 Senator Mathias. Before you leave: that, a3 a matter of
13
record , I am requested to note an exception on behalf of
14
minority .
15
Mr Aaron The second section was the covert use of
16
American clergy 'and laity. This i8 on Page ' 64 _
17
Senator Huddleston. Was that included in your motion?
18
Senator Hart of Colorado_ No .
19 Mr = Aaron . I think that covers the recommendation_
20 Mr = Maxwell They hadn € discussed; whether: it;}
21
should be made public =
22
Senator Huddleston . Well, if lt becomes a statute, it
23
becomes public
24 Mr Inderfurth. But the statute will remain secret.
25 Mr Aaron NO , we are ready to move on it, Ito covert
4 E RfpDP?
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1 use of American clergy and laity.
2 Senator Huddleston Well
0 -
the covert actian,is;
5 4with_ < the notede:1 exception , those recommendations go before
the Committee .
5 Senator Hart of Colorado. Just for clarification_
8
Mac , is
6 that the entire minority or what?
7 Senator Mathias No , it' s one member .
Senator Huddleston _ Now we are ready to deal with the
clergy .
10 Mr . Aaron , The point here is,. I think
0
the CIA takes
11 the position that it has no covert arrangements with American:
12 clergy and laity, and that this will continue a3 policy, but
13 they have relationship of a clandestine character which don 't
14 involve remuneration .
15 Senator Huddleston Inciden_ tally, i9 that 3 new policy?
16 Mr Bader Yes , as of February 10, 1976_
17 Mr Aaron:, It'8 pretty short- This 18 the sum total of_
18 our findings
0
and it explains it better than I can
19 Mr _ Bader This has not been , obviously you
can see
20 Senator and members of the Committee , from the text that the
21 Committee has found the CIA has; a total 0f 14 covert arrangement
22
involving direct operational use of that should be religious
23 persons , an I found it very difficult in Ithis to properly or
24
respectively address the category here _ whether they are American
25
clergy, regligious persons or whata It is a term of art I
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23
1
really haven t quite been able to deal witha
2 As of February 1Oth, the CIA announced that the CIA has
not secret paid or contractual relationships with an American
clergyman or missionary. This practice will be continued a3 a
5 matter of policy
Senator Huddleston . I think we ought to clarify that
religious persons That would include Chuck Colson
Mr . Bader _ The issue here is,. we are saying in the first
instance, we welcome this policy which they intend to put into
10
their operational prohibitions
8
and the recommendation that
11 we bringrto you is a very simple one ; in: addition: to that is
12_ that it be extended fron contractual to all operational relatior
13
ships, paid and unpaid_
14 Senator Huddleston . By statute.
15 Mr Bader By statute.
16 Mr Inderfurth May I ask, a question here?
17 How does: this conform to Senator Hatfield's bill on.this?
18 Mr Bader . I don t know
19 Mr Inderfurth I don t know I'11 get" a copy of it,
20
but I think to the degree possible , if the committee
recommends by statute a prohibition , it should be made to conform
21
22 to: that' because he has in a great deal of work on that, or
23
without knowing the facts, I might add
24 Mr Kirbow. The other thing i8 the Committee may want
25 to support legislation that i8 already pending .
7e 5 CE 07
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1 Maxwell . What is the nature of the covert relationshipl
2 with religious persons now in effect?
3 Senator Mathias . A few patriotic volunteers .
Mr. Bader . Patriotic volunteers at least one of then
5 from the operational records
I think , too, they have what is called a memorandum of
agreement which is not contractual in the gense that it
involves 'paid or unpaid
Mr_ Maxwell What are doing?
10 Mr Bader They collect intelligence information .
11 Mr _ Kirbow . What ig a
religious
Person 0 Mr . Bader a3- they
12 u3e it or as you use it here?
13 Woula that mean the organ player that is a oivilian who
14 travels with a preacher and plays the organ?
15 Mr _ Bader No , It i9 intended to be the American clergy
16 although I certainly: woula lean on whoever can' tell me what a
17 proper term is to define American clergy .
18 Senator Mathias . What about this. fellow around, Maharaja
19 Rani?
20 Senator' Huddleston. I'11 think on your defintion_
21 Mr. Bader I think we 11 have to have a footnote as to
22 what American clergy may be
23 Mr diGenova American clergy or missionaries , certainly.
24 Senator Huddleston Well , missionary gets a little
25 fuzzy _
3 0 6a CpepE#
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Mr. Bader The Agency uses 16 American clergy or missionary .
Senator Huddleston It has to be a perbon whose primary
3 occupation i8 for 8
religious order or sect or something
0
it
4 seems to me .
5 Mr . Kirbow. How about the Mormon youth who do their things
overseas?
Would: this take care of them ana prevent them from getting
gobbled up?
Senator Huddleston _ I think that' s a good question_
10 receive no pay
11 Mr . Kirbow. are not church people; per se It 18
12 part of their religion
0
doing the service You see, this gets
13 tobe a rather broad extension, or you leave out certain
14
things if you are not careful with your definition::
15 Senator Huddleston I think there may be somewhere in our
16 litany a definition
0 I am not sure
17 Mr Inderfurth I would imagine that Senator Hatfield' 9
18 bill, a definition of what
clergy that would be spelled out.
19 There are copies coming over now
20 Mr Bader Well , I think maybe we will get 2 copy of the
21 definition of clergy or
missionary _ Maybe that will clear
22 that UP .
23 Senator Huddleston Well, I think you know some
24
churches send people over for a very short period of time They
25 are
people, really, but while they are there, they are
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there more or less under the auspices of the church group .
2 Mr Kirbow . At least a local church frequently spongored
3 then .
4 Senator Huddleston_ I don € think you can prohibit 2ll
5 those kinds of people. I think sone kind of" definition should
include the primary occupation of clergy. clergy itself .
Senator Mathias Well
0
don t:we commit to staff for
the moment_ the question of definition?
Senator Huddleston . I think we will have to do that.
10 Okay . Are we ready to move on that?
11 Mr Aaron The recommendation is that whomever or however:
12 we define them a and that 8 obviously
an important question,
13
that they either be prohibited by statute The other alternative
14 is to simply prohibit any further or recommend the prohibition
15 of any further CIA recruitment in this field
16 Ms Culbreath The way this is worded , this would get
17 anybody who is a member of a church. You have got recruit-
18 ments of American clergy or laitye
19
If I am a member of the Methodist church , I am in the
20
laity of the church_
21 Mr. Miller_ You have raised a question There are people
22 who- are not priests in the religious hierarchy in a-
particular
23 sect who may devote their entire lives to that particular
24 church
25 Senator Mathias Well, I think the word "a religious"
Tee 5a #ee5F7
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1 I'm serious here should be considered
2 Mr . Aaron . "A religious? 90
3 Mr Bader We 11 have to obviously work on that _ Laity
4 was not meant here to be a member of a church, for technical
5 terms , the technical terns Mr Miller mentioned _
Mr. Miller As distinct from the. congregation ,, it was
meant to deal with- the administrators in a religious order
Senator Huddleston Well, some sects have lay preachers and
clergy .
10 Mr . Kirbow . Senator Hart, do you want each of these
11 categories like this examined in the light :of the constitutionali
12 question that you raised earlier?
13 Senator Hart Of Colorado . I just raised the issue where
14 the academics were concerned to resolve it, S0 I'm sure it
15 should be raised by somebody .
16 Senator Huddleston Are you ready to go on the religious
17 insofar as what .i9 the definition? Then that will be
18 Senator Hart of Colorado _ Ye8 , Sir:
19 Senator Huddleston . Then that: will be moved . up I assume
20 with exceptions noted?
21 Mr , Kirbow I don't have any exception to that one ; sir
22 Mr, Inderfurth That is by. statute, right?
23 Benator Huddleston. Pardon?
24 Mr Inderfurth_ Is that by statute?
25" Senator Huddleston Right _
I Ren ps *93
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1 Mr , Maxwell There may be a First Amendment argument
2 here , particularly in fundamentalist groups whose religious
5 beliefs are committed, are directed toward opposition toward
4 Godless atheism
5 Mr diGenova Except that the control of religious organi_ #
zation has historically been subject to governmental regulation
in this Sense: the ` Supreme Court in light of Senator Hart' 8
question last night, I did a little. bit of research. The
example, the prime example of regulation doesn t deal s0
10 much with prohibition of the Government dealing with someone
11 although there are Vast areas where the government is not
12 permitted to get into . The question is, for years the Supreme
13 Court has ruled that there are certain health regulations d
14 stateb that religious sects' must comply with; and they have
15 to comply with it even if it conflicts with their bagic religioys
16 belief , that they have to comply with it, like quarantines
17 or things of that nature
18 So there is clearly an area where the First Amendment of
19 religious freedom concept falls in the face of a greater good _
20 the need: of the general public and that has generally been
21 in the health area , where there is some practice of the
22
religion which conflicta with Some standard which has been
23 set in the community at_large , and that generally has dealt
24 With health
25 Mr Kirbow Maybe the HEW Act can
bring the CIA under one
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1 Of these health threats.
2 Mr _ diGenova
0
Self-immolation .
3 Senator Huddleston. The snake acts and innoculationg
4 Mr . diGenova That' $ exactly right.
5 Mr Maxwell The problem is that' s, not quite applicable
to this, and one has to argue in the past the Court has ruled
on things that are found to be a threat to the personal liveli-
hood or health of the individual rather than something: that
could be construed in a fundamentalist sense
10 Senator Huddleston This doesn t preclude a sect that
11 may be anti-atheist, and a3 such anti-Communist from pursuing
12
its principles , but the restriction woula be pursing then through
13 a government agency , which happens to be the CIA; or any other
14 methods .
15 Ms Culbreath. Would this prohibit, then , somebody who was
16 a member of one of these sects that was in an area where they
17
gained information that would be helpful from them being sources?
18 Senator Huddleston I wouldn t think S0 if they wanted
19 to write letters to the CIA
20 Ms Culbreath Well, just in terg of the: debriefing kind
21
of thing, or contact.
22 MS . Davis We are
talking about operational , not coming
23 in to the Domestic Contact Service.
24 Mr . diGenova It is not very clear on this_
25 Mr _ Maxwell The problem in part goes back to the difficult;
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we had with the Domestic Contact Division in trying to determine
2 what wag operational support, if operational support woula be
3 what did you learn about individuals there who' might be
4
receptive to American approaches _ Then the clergy would be
5
prohibited from providing that kind of information if that
is operational support.
7 Senator Mathias . Well , it: geems to ne if the religious
came in and said I was at a meeting: of the Rollers last nighd
and we all went down on the mourner 8 bench, and I heara the
10 most remarkable things ; and this is what I heard_ there would
1l be no prohibition against listening. Now , if you say , go pack
12 to the Holy Rollers tonight
13 Mr . Kirbow And listen again_
14 Senator Mathias Then you ve got a question_
15 Senator Huddleston Then it is operational
I_don t think there' $ a need to write in that it doesn't
16
17
pertain to the
voluntary furnishing of information . I don't
18 know .
Mr Aaron . I don t think
04 no , that 5 really not an 19
20
operational use, quite frankly. It'6 very similar to the DCD
21
which takes information fron lots of people, including people
22 who are and have been for some time proscribed by CIA S own
23
Senator Huddleston_ Well , anyway , that would be worked
24 out in the statute itself.
25 Mr Aaron We are spared the problem _
Te5 CfeDe?
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1 Senator Huddleston We ought to move on
2 Mr _ Aaron _ The next section is proprietaries and cover,
3 Senator Huddleston. I just wonder if in pregenting this,
these three , these four, now , that we have just approved , it
5
would be of any value to assert in our report that we recognize
that the Agency has to find proper cover for its agents, that
restricting that cover is a matter of sone importance , but there
are certain institutions that the Committee feels because of
their nature and because of their standing in the country, and
10 because of the need for the public to have confidence in then ,
11 that should be , in effect, off limits and because of that
12 we reconnend that these four recommendations be brought. I
13 don t know whether you want to . make it sound any better 0
14 not
15 Senator Hart of Colorado . Mr Chairman, does the absence
16 of brackets on the next set of recommenda tions mean that
17 are non-controversial?
18 Senator Huddleston . On the proprietaries?
19 Senator Hart of Colorado: Yes
20 Mr Aaron. That is correct
21 Senator Huddleston._ The gentleman did such a great' job
22 that nobody can question then
23 Mr Aaron . I think there is one set of brackets , and
24 the next section is on page 67: in which it says that
25 Mr . diGenova _ Oh , yes , there is something.
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1
Mr _ Kirbow: What page are you on?
2
Mr diGenova 67.
3
At the bottom of page 67 is a bracketed quote about
Admiral Raborn, a former Director of Central Intelligence_
Now , if my memory serves me correctly now , first of all,
this is the' first time that anyone is mentioned bY
name in the
findings _
8 Senator Huddleston And the total findings
are in that
9 section
10
Mr . Kirbow. The findings are this foreign and military.
11 Senator Huddleston _ We referred to Helms and Laird, but
12
I think we decided we coula write around that.
13
Mr . diGenova Well, here S what happened here. This
14 paragraph deals with the fact that when the Agency disposes
or
15 dissolves a proprietary, it tries to avoid conflicts of interes
16
However
#
when noted that sometimes pressures were brought
17
to bear on the Agency to dispose of the entity
as a favor to
18
someone , S0 that it would benefit someone else .
19 NOw , the most glaring example of this was this activity
20
of the former Director
8
Admiral Raborn , who actually became
21 involved in negotiations on behalf of a client , Overseas
22 National. Airways , which he represented and he wanted the sale
23 of Southern_ Air Transport , which was a CIA proprietary, large-
24
assets and large property, to Overseas National Airways , which
25 of course woula have. acquired Southern Air Transports lucrative
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routes
2 Now the. way I originally had it written was "A former
Director of the Central Intelligence Agency sought unsuccesg-
fully to influence the sale 01 However , if it was left that way ,
people would have to guess at which one of these guys dia this
and it would unfairly impugn all of the directors The name
was inserted . Therefore the question now becomes whether it
should be left in at all since the name is inserted and since
the name is mentioned in the report, and whether or not the
10 whole sentence-=
Senator Hart of Colorado Well, what if we just saia "A
11
12 former Director"?
Mr:. diGenova Well,. the problem there , Senator , is then
13
14
people say , which one was it?
Senator Hart of Colorado Good:.
15
Mr diGenova Oh , all right_
16
Mr Inderfurth I think the assumption would be Richard
17
18, Helms
Mr.. diGenova McCone more than Helms .
19
Senator Hart of Colorado _ Well, we ran into this lagt
20
sumer with the Exener matter and all like that _
21
Ms Culbreath
0
A former person _
22
Mr _ diGenova The Agency itself cited this as the most
23
flagrant example of intercession on behalf of anyone _ As a
24
matter of fact, the memorandums on this refer to dozens of
25
5ee 5a RPaDf?
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34
1 phone calls and overtures , and it i8 a former Director trying to
2 gain a benefit. It i8 an unseemly situation
0
and they labeled
3 it as a conflict:of interest which' they gought to avoid, and
in fact they: did, and are praised for it in the report
5 because they were really under tremendous pressure.
So I have no feel one way or the other . I think to
leave out his name
unfairly impugns the other To leave it
also , is only the second time in the whole findings and conclusip}
that we mention anybody 8 name , 80 I don = t care,
10 Senator Hudaleston . And you ve got' one, Recommendation
11 No . 5 , related to the disposal of the. proprietaries
0
that he
12 Justice Department approve?
13 Mr , diGenova Be consulted On the disposition_
14 Mr . Kirbow . Mr Chairman, can I be heara on that?
15 Senator Huddleston . Yes , sir.
16 Mr . Kirbow. Senator Hart, in this regard we have consistently
17 attempted by most: every reasonable means to not use the names
18 of people unless had committed some thing illegal
19 Senator Hart of Colorado . Mell don t side with Me I'm
20 not taking
a position.
21 Mr Kirbow_ But the Exener . thing was a example, but
22 we must have had 20 other names that we went through on that
23 asgassination
0
and we wrote around them _
24 Senator Hart of Colorado But a number of people argued
25
strongly that We ought to name her and go into details , So .I
Tod CrpdeT
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35
suppose the Same arguments could bel used here on this matter.
2 Mr Kirbow . But the point I raised: at the staff meeting
3
just before the Connittee came backl when: the subject wa8
raised , was dia Admiral Raborn as a retired military officer
0
5
currently in a civilian status although he was former beak
any American law , or had they sold it to this
0
woula it have
been a violation of the law, and the answer wag no
If- he was involved
5r or theyl knew of no law that he
had violated
0
and none is apparently cited in the record _
10 Pressure was brought to bear
0
there is, no doubt about it,, by
11
Admiral Raborn I think there 8 another example. I'm not
12 sure whether Joe described it to Me or someone else, of a
13 very senior official out there dealing back with the. Agency .
14 Now
0
the military, a3 Senator Hart knows _
0
is prohibited
15
from this by regulations and I think by law
0
I know that as a
16
regular military officer
0 you are not: allowed to do contractual
17
business with your agency forever but with the other military
18
departments and the Department of Defense , I think you have to
19
have a cleansing period of five to Seven years _
20
I don t believe there is' any such provision in the Act
21
that applies to. former Directors, afd probably what the Committee
22
shoula do is consider this action without necessarily naming
23
him unless he was in violation of some really serious
24
wrongdoing, and make a prohibition
8
drawn similarly, with what
25 nowi
applies
to senior officials going back and kind of exerting
5ea Fa ERem
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1 undue influence on those people.
2 Senator Huddleston . Joe , is it accurate to say that
3 pressures were often brought to bear?
4 Mr diGenova We changed that to say: sometimes This is
a rewrite Someone else wrote this after I had submitted it,
and we had a
meeting today , and we 'changed several things in
there-
So I leave it up to the Committee. This was a matter that
I -= I wanted to it and leave it there _ The explanation
10 is a3 clear a3 I can give it.
11 Mr , Inderfurth This is the first time he is mentioned
12 in the entire paper
13 Mr diGenova That S right.
14 Senator Huddleston . Why don t we delete that sentence and
15 keep it in our full report, Our report.
16 Mr Kirbow There is a major classified report on
17 this that woula contain all the facts .
18 Senator Huddleston . I am aoncerned now whether: any other
19 ingtances of someone may be
0
of similar standing a8 Admiral
20 Raborn
21 Mr . diGenova Yes . There are instances in the record
22 which do not deal with proprietaries , of John McCone interceding
23 on behalf of Pan American directly with the Director of
24 Central Intelligence
0
and it is' not mentioned in the report,
25 and it should be, and it is a
problem that we- have had
0
Mr
Tem 5 epeDeT
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1 Chairman _
1
has been that the work involving the relationship of
2 the Central Intelligence Agency
with American business companies
3 wa8 severed off from the proprietary work for the ` simple
4 reason that' they are not the same
thing_
5 That work has been done _ It has not been pursued vigorous-
not because the individual who was responsible for itd
didn t want to
Senator Huddleston _ That happened after he left.
Mr diGenova _ That 5 right, after Mr McCone _ left the
10 DCI, he had frequent contacts , according to the records
8
with
11 the Agency_
0
with high level: Agency personnel , and in one instanc
12 he interceded. personally with the Director of Central Intelliz
13 gence to avoid actions which woula be taken bY another govern -
14 ment and itg"airlineewhich woula adversely affect Pan American
15 World Airways .
16 Senator Huddleston. It is hard to separate a man from his
17 past totally.
18" Mr . diGenova_ It seems particularly hard with DCIs .
19 Mr Kirbow Well , not only here , this is not with the
20 Agency , but it came up in my experience with the Armed Services
21 Committee involving Continental Airlines .
22 Senator Mathias This sentence.
23 Senator Huddleston Just the sentence in brackets
24 Senator Mathias _ Well , I think if.you ve . got a Raborn' Case
25 a McCone Case and whatnot , that you can t make Eish of one and
0 Er#
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38
fowl of the other.
2 Senator Hudaleston I think we ve already said that
3 pressures sometimes were brought to bear and we make recommenda -
tions to correct that.
Ms Culbreath. Mr Chairman
0
could I suggest that maybe if
We do delete that , that we perhaps redo that previous sentence `
to make it a little stronger
$
and perhaps in Some way
indicate that these were serious pressures , and they were , I
9
think, hard pressures to withstand when somebody in that kind
10 of position
11 Senator Huddleston. They were withstood , though_
12 Mr Maxwell would get lost the. way the sentence is
13 cut_
14 Mr . diGenova I think what we will do is David and I
15 will get together , and Elizabeth_
0
and we will change this
16 "however" sentence , ehe sentence that precedes the one that
17 ha8 just been deleted, and we will expand that sentence to
18 more accurately explain that the. pressures came from high sources
19
sometimes Some of then may have been maybe former Agency
20 directors
21 Senator Huddleston I think we should make the point that
22 it was former
23 Snator Mathias Well, if they were former directors ,
24 then you may as well leave in the last sentence .
25 Mr diGenova . Maybe .
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1 Mr Kirbow Mr Chairman, may I suggest that maybe
2 perhaps we use this type of part of the investigation and what
we know from certain of the other files to prohibit this type
4 of conduct by law in the future in our general recommendations?
5 Senator Huddleston. And make it similar to
6 Mr Kirbow. Similar. I think would have to look at
something from the staff_
Mr _ diGenova I didn 0 t have that recommendation in there
0
9 but I think the record indicates it ought to be there.
10 Mr Kirbow. It wouldn t be proper 0
necessarily, to put it
11 right here under proprietaries , but let'9 put it in_ the
12_ general recommendations_
13 Mr diGenova David , did you that?
14 Mr . Aaron . I'm sorry:
15
There' $ a recommendation that
16 Mr , diGenova That Agency personnel
17 Mr Kirbow . Senior fficials_
18 Senator Huddleston Similar to what applies
now for
19 military
20 Mr _ Maxwell. Well , perhaps the statute, perhaps we could
21' recommend a statute similar to that governing the Department of
22 Defense
23 Mr Kirbow . Be enacted by the next Committee, similar
24 in effect to
25 Senator Huddleston . And find 8
proper place to put it in
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our recommendations .
J lb 2 Mr Aaron Okay.
'begin 2a
3 Mr Maxwell Well , Charlie, correct me . I think the
proprietary section would be the appropriate section because
5 that would be where it came up most/ unless there is another
6 one that see more readily.
Mr _ diGenova We can work that out, I don' t think
that'$ terribly
Mr Kirbow I think there have been two or three sug-
10 gestions made here that will result in general" recomuendations
11 on a page that isn t necessarily supported findings _
0
but you
12 come to this overally conclusion based upon your total concept
13 of the Agency and its procedures and everything else in view
14 of the findings _
15 Mr diGenova
0 .
The only thing I want to do is p
David,
16 I know you have gone through this, but the Senators may want to
17 look at page 68 through 70 , which deal with cover , and particu-
18
larly with Mr Welch .
19 Ms Culbreath I had a point I wanted to raise on that.
20 Mr _ diGenova Well, Mr Chairman , I think: the Senators
21 want to read this
22 Ms . Culbreath don' t we let them look through it.
23 (Pause . )
24 Senator Huddleston Let 8 go back on the record_
25 Mr diGenova I do know the Agency is going to come in
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tomorrow to review the cover paper from . which this summary is
2 drawn . I know Eric has some problems with the cover paper both
3 editorially, because they, view it as overly simplistic and
harsh because it" reflects all of the Inspector General ' s
judgments , but they have some problems with cover in general
but. I don 't think this is going to be part of that problem_
Senator Huddleston I have some
problem with this page
70 . relating to Welch because it seems the whole implication of
that is that he was, murdered because his cover was blown _= and
10 S0 far there has been no evidence that that is the case, It
11 highlights the argument , I think correctly, but it seems to me
12 it leaves' the impression that here is a case where a fellow' s
13 cover or lack of Cover resulted in his death.
14 I think the Agency people have specifically said to uS
15 So far that they have no reason at this point yet to expect
16 that that was the reason he"got killed.
17 Mr Maxwell In regard to the specific quote , I think
18 we have to be very careful 38 to getting involved in an argumen
19 which would imply that anything that we possibly did.had an
20 effect on it; and also , that it seens to point to Mr Welch
21 and say , well, it is all his fault.
22 Senator Huddleston He didn t protect his cover , he
23 didn t do what they advised him to do, and ' you see down here
24 Ve have another quote which says , referring to international
25 terrorism and incitement for these kind of people to take the
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kind of action which unfortunately led ito the death of Dick
2 Welch.. There again we are ascribing some thing to the death of
3 Dick Welch which nobody knows yet, you know , what terrorists
killed him or why ; at least our record doesn t show .
Mr diGenova _ These statements here, Senator, this is.a
direct quote fron Eric Eisenstead 8 memo Do you think that
we should maybe in the findings and recommendations shorten
this and maybe
Mr Kirbow. I think the part of the record which is. an-
10 unknown fact is Dick Welch was killed and we
should stay
11 away from any quotes Or other pronouncements in our paper Which
12 attribute his death to any particular thing unless we know
13 something.
14 Mr _ Aaron , I think that is a
good point_ We might put
15 in here a statement which says the Committee has no information
16 a8 to the reagong , purposes or cause; specific cause, of his
17 death_ The point is to get at the question of cover , to
18 step out to the question of cover in the report, a3 We do , I
19 think,. appropriately , but not have talked about the one case
20. where this all came out in public_ rightly or wrongly.
21 Mr = Kirbow . Why don t we use the cover for the' gentleman
22 in London , then , where as the tour buses go of course, you
23 know this is the home of the CIA chief and he hasn t been
24 killed yet or anything like that_ If we want to use that
25 kind instead of ubing this_ death example; which_
0
by the way ,
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has brought some thousands of letters Erom the constituency of
2 certain southern Senators who shall remain unnamed Or near-
3 Southern Senators, becabse it kind of wab a catalytic agent
in getting a lot of complaints on the Committee and everything
5 else, and this pointing out or explaining Welch' s death goes
back to it.
7 Senator Huddleston_ I m gort of southern _
8 Mr Kirbow And You ve got a lot of them.
Senator Huddleston Of course , it wag used for that;
10 purpose by certain high officials for that.
11 Mr. ' Kirbow. The very highest, including attending the
12 funeral
13 Mr diGenova Well, I think one of the things we wanted
14 to pinpoint here, and first of all, I think we can sumarize the
15 Agency 9 testimony a little better The Agency said, nothing
16 this Committee did , first of all, had anything to do with his
17 death , a8 far a8 know
18 Ms Culbreath. But they don t know.
19 Mr diGenova . As far as they know , don t know one
20 way Or another , but the impression that Was created in the
21 press was and was pandered to by the DCI and the President,
22 was that the general actions of exposure of Agency operations
23 were responsible for the death of Mr = Welch, and pandered
24
that by inviting Committee members to the funeral as if they
25 bore sone responsibility'
7 La ReeDFT
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1 Now the obvious public relations value of Mr Welch '*s
2 death, the first time in! history the DDO and the DCI go_ to
3 a funeral in public, they never did that, and there i8 no doubt
that they tried to. make political out of his death.
5 think it is only fair that the Committee ultimately
say
Senator Huddleston Right , but I think ve' got two
different problems _ You ve got a problem with whether the
Comnittee wants to present its case and exonerate itself on the
basis of everything that is known about the death.of Welch ,
10 and whether that i8 pertinent to the problem of cover
11 Now we make a recommendation that the CIA shall make} an
12 effort to place a greater proportion of its officer abroad
13 under nonofficial cover It seens like what we need , there' s
14 a statement here is that' official cover has not proved to be
15 effective
0
and if we mention Welsh at all, I think the point we
16 mention there is that his name was carried; that while he was
17 there supposedly under cover his nane was in fact carried in 8
18 newspaper , the name of his newspaper had been: carried in a
19 foreign newspaper , ana he was living in a house that was known
20 to be the house _
21 Mr_ Kirbow = His true identity was widely known .
22 Senator Huddleston We can cite hin as an example without
23 indicating why he: had been killed , of here is a case that
24 eve rybody knows about, so-called official cover was not in
25 fact very deep cover , There may be other instances that we
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1 want to refer to, but if we get into his death at all, I think
2 We have got to present the case that blowing his cover is not
3 necessarily what killed him Nobody knows that a3 of now , 80
far as I know Nobody knows it wasn t just .a street gang or an
idiot
0
Mr Kirbow_ It could have been like the Senator, John
Stennis case , where they buttonholed him in front of his
house and killed him for robbery purposes
Senator Huddleston We Ve asked them two or three times
10 here , have we not?
11 Mr , diGenova Yes we' have In fact they don t know
12 Senator Huddleston_ In fact, the last time Nelson was
13 here we asked him
14 Mr Aaron . Can I try a fix on this, turning to page 70 ,
15 instead of saying 10 the career and tragic death of the station
16 chief , 20 let' s just say the 08 situation of the station chief in
17 Athens illustrates the tension As the: Chief of the Cover
18 Staff stated by the time a person becomes a 'chief of
19 station, there is not a great: deal Of Cover left" leaving in
20 the rest of that sentence , and then add in here, as you did_
8
21 Mr Welch and his_predecessor were both identified and naned
22 in the local press Further, Mr : Welch occupied the same
00 23 house
24 Senator Huddleston Which presumably was known to be
25 the house of the station chief
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1 Mt diGenova In fact, the station chief' s name and
2 address in Athens had been presented ,
8 S0 when he wasiin there
3 the address had already' been printed previously .
4 Mr Aaron _ Which was also known_
5 Senator Huddleston_ Now if we want to say something about;
an added dimension to the seriousness on
blowing
cover or
cover
being diminished , 18 the situation in the world with
terrorism or the vulnerability it makes of people
9 Mr , Kirbow To the unstable
10 Mr Aaron: Wellv the point in the testimony is that
11 this was an added danger , but: because they Ve .got a job to
12_ they re not going to really do too much about it. It's
13 a real risk they are just going to have to bear_
14 Senator Huddleston That 5 an occupational hazard, but we
15 are talking-about how to protect their cover
0
and our recommen -
16 dation is that they use 4 4 have an official cover _
17 Mr Kirbow Well, can the staff change the language,
18 because we know, exactly what you want to do , and withouti
19 taking further time , don t we just changecit.
20 Mr Maxwell_ I would just hope that the two quotes after
21 the one that David cited} the quote_
0
he , Welch , was asked the
22 last guote, we could make the point in a different way because
23 the impact of the first quotev I think, is.this guy was stupid
24 and irresponsible, and" I don t think we need::to have any
25 implication like that in_ the report, and the second one , I
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1 think we can make the point that terrorism may constitute a
2 greater threat now .
5
Senator Huddleston I think that guote ought to go entirel_
because it does leave the implication that there was_ a direct
link to losing his cover' and his assassination.
6 Now we don t know that_
Mr Aaron So just take out the last one
Mr diGenova But still speak about the added danger of
international terrorism Just stop at the word 0 international
0 10 terrorism_
11 Senator Huddieston. Down in the recommendations I verbeen
12
talking to Joe about defining the small busines8 , and I think
13 we
fairly well understand 'what- the concern i9, or do we , Joe?
14 Mr . diGenova , Senator, I was going to suggest, if you
15 look at Recommendation No . 3 , while it doesn t define what a
16
large proprietary is, the Senator was concernea about what
was meant by 0 shoula be 'kept small 0 " and I tried to indicate
17
really we are talking about Air America where you had 8000
18
employees of the CIA , both in Langley and abroad and then
19
another 8000 employees Qf the Air America, complex That is 20
21
But I.think':What weishould say is ; organizationally small
22
23
and organizationally and numerically sma)l because what We are
24
really talking about is when they get whether it is in
25 numbers Or finances , and larger in terns of people usually means
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1 larger in terms of finances , also . Then you have both of the
2 problems we addressed in the paper which was the risk of
5 unfair competition with private enterprise , and the risk of
blowing cover, of compromising security.
5 So I think that
Senator Huddleston . I was wondering if it could be
designed in such a way a3 care should be, taken; that it not be
any larger than necessary to achieve the objective for which
it was established _
10 Mr . Kirbow . Excuse me , Senator It woula not get the
11 Air America thing because at the time they needed one twice
12_ that size
13 Senator Huddleston. They needed it that that' s
14
right.
15 Mr _ diGenova The reason this language is in here is that
16
the Agency officials thenselves who testified, all of then
17
including the DDO , said'they would like to have small ones , in
18 other words , 3 small number- of employees , small operation.
19
Senator Huddleston What about their insurance business?
20 Mr . diGenova ~That's kind of an exception
0
although
21
actually that is an example of a lot of money with only a few
22 employees There are a couple of people that run that
23
whole thing, Isenstead and a couple of # 4 one investor
0
24 Istenstead and an auditor There are three men that run that
25 S32 million complex: So that i8 a different animal , really-
4 0a Cpe02?
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Senator Huddlegton So if you are going to use the term
08 2 "small you ve got to say it from the standpoint of employees
3 Or resources
4 Ms Culbreath. I was just going to suggest: that, since
5 another of our recommendations suggests. annual review Of 2ll
of these criteria , and since their budgets are going to. have to
be included for the oversight committee with review for the
others , and we have got a proposal that the Committee also
establish guidelines for the approval of the creation of large_
10 proprietaries
8
should these become necessary.
11
Perhaps the better thing to since these proprietafies
12 are for a
specific need at a specific time , ana since we have
1j
got the review procedure , is sort' of trust itv to the oversight
14 committee: to see to it that' they don 0 t get too whatever
15 that may be , and leave it to then maybe just delete that
16 second Sentence .
17 Mr . Kirbow Well
0
that'8 certainly a workable' way .
18
Senator Huddleston. I don' see how you are going to' keep
19 that bentence in there without: having it.
20 Mr Aaron I would also suggest that perhaps in the
21 section on
proprietaries_
0
where we make a coment. about how
22
large proprietaries run risks in blowing their cover , we might
23 would it be possible, do you think
0
to make a
finding or make
24 an example in regard to Air America?
25 Mr _ diGenova _ Absolutely because they have conceded
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0 that 8 the one that ran all of the problems
2 Senator Huddleston _ You do mention that somewhere , don t
5
4 Mr Aaron . It'8 not mentioned specifically; but it might
5 be possible to say , you know
0
maybe you can, put a footnote on
the first paragraph which Simply, said
Mr_ diGenova You mean on the findings of page 66 that
"too often large proprietaries have created unfair"
Mr = Aaron . "Unwarranted risks Jof unfair; competition with
10 with 'private- husiness: in compromising their: cover: m1 You should
11 Say . 14 for:example ," "Air America, for: example , which:had :8, 000
12 employees , 'and sQ: forth ran into both of these problems
13 Senator Huddleston . I think that woula be all right.
14 Mr _ Aaron. And then you would have- at least Some reference
06 15 to what large] was
16 Senator Huddleston . Then you' ve got the review and the
17 oversight.
18 Mr Inderfurth So the idea here in the recommendation was
19 to take out the second" sentence .
20 Mr diGenova:: Yes
21 Mr Inderfurth. Why not take out the first as well and
22 just go to Recommendation No _ 2 as No _ 1?
23 Mr diGenova _ Well, I think # 4# can I just say this that
24 by indirection
0
approving of an activity i8, I suppose, one
25 way of doing it. I don t see anything wrong with stepping up
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1
and saying we examined proprietaries_ we found them to be
2 they had problens but basically
were all right.
3 Mr _ Inderfurth. Couldn t that be in the body a3 well?
4 Mr_ Kirbow The one thing we have failed to do on this
5 Committee is where we- are strongly in favor of
9
is to speak
out in' a manner supporting an agency under otherwise violent
attack from many sources , and I think 3=
Mr Inderfurth. I think that_ is not true , Charlie. I
think you Will find, if you read the findings of Bill Miller
10 and others wrote in the first part, it says: very strongly,
11
intelligence is necessary; we need it.
12 Mr Kirbow . I'm saying up until now it has been an agency
13 under attack. I think this whole section on
foreign and
14 military has been to make a balance between past wrongdoing
15 and current operations
16 The Chairman . There can t be anything wrong with leaving
17 the sentence in there
18 Mr Maxwelll I raise 3 question to the second
19 recommendation , as to the reason why by statute there would be
20 an annual review rather than recommending that to Congressional
21 Committees:
22 The second ppart of that is, my-understanding of a_ number
23 of the proprietaries is that they are not operating; and to
24
require GAO audit of a whole group of in a sense notional
25 organizations may be preempting the kind of review that the
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1 oversight committee should be doing rather than setting it out
2 here It' s just a question
3 Mr diGenova This is a rewrite of my original recommen-
dation
0
and it 18'a. good pointa It may very well be that that:
5 is superfluous, if you are
considering oversight by a committee
Senator Huddleston _ The Committee cannot conduct an audit,|
though
Mr diGenova And that was the purpose for the Committee
taking
on board independent GAO auditors .
10 Mr Maxwell The Committee can request GAO auditors
11 Mr, Kirbow_ Anything that appears
to be on an audit
12 calls for an audit
13 Senator Huddleston _ Calls for a GAO audit or gives the
14 Committee authority to call for one
15 Mr_ diGenova I don t think we need 2 statute. We can
16 talk about it as part of Congressional oversight As part of
17 the Congressional oversight function , the oversight committee
18 should review proprietaries annually 'and where necessary
19 conduct audits with the assistance of the General Accounting
20 Office
21 Mr Kirbowa Here , Mr Chairman , I think again the. point
we
22 made yesterday , that we should say at leagt annually, So that
23 don t put You in a box 'if you want one every two months
24 because of circustances
8
"at least annually- 91
25 Senator Huddleston . You could add in Section 3 , at least
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there, giving the Committee authority to establish guidelines
2 to establish for large proprietaries
0
shoula become
3 necessary _
You could also make the statement there that the Comnittee
5 may call for a GAO audit periodically.
6 Mr diGenova . So we will rewrite 2 to eliminate the. statut
Senator Huddleston . Independent `GAO audit_
Mr . Aaron . No . 2 is rewritten S0 it is not required by
9 statute that there be an audit, internal audit?
10 Mr - Kirbow . No GAO audit.
11 Senator Huddleston . The thing I had in mind of
12 taking out of 2 wag just the independent GAO audit being
13
required by statute, and leave that to the discretion of
14 the Committee, but leave the rest of the review , right?
15 Mr Maxwell You amena it by statute that an annual
16 review of all proprietaries?
17 Senator Huddleston . An internal CIA audit.
18 Mr Maxwell Or would it recommend that , I'm not sure
19 which.
20 Mr diGenova I'm 'wondering whether it should be done
21 by statute Maybe we should recommend to the oversight
22 committee that there should be an annual review congisting of
23 internal CIA audit.
24 Mr Maxwell An annual report to the oversight comittee
25 and such GAO audits as the Committee
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Mr diGenova May deem necessary .
2
Senator Hudaleston. That' $ all right_
0
3
Mr_ diGenova . And then we could add, as part of its
4 annual report, the GAO should record all of its intercessions
5 That should be 10 report: 0 They record all of them
# S0 'change
"recora" to "report"
Ne: can rewrite that.
Senator Huddleston. Make that a little stronger _
9 Mr diGenova Must report?
10 Senator Hudaleston. Shall be required to report
11 Mr _ Aaron_ I'm sorry.
12 Could we now have a recapitulation by whomever thinks they
13 followed this?
14 Mr _ diGenova Elliot?
15 I defer
16 Mr . Maxwell. "There should be an annual review 01 t
17 Mr_ Aaron There is no longer a statute The Committee
18 recommend8; that there be, right?
19 Mr_ Maxwell - B8 #
"a review ; at least" annually, of all
20 CIA proprietaries . 9
21 Mr. Aaron By_ whon?
22 Ms Culbreatha By the oversight committee
23 Senator Huddleston By the oversight connittee
24 Mr. Maxwell. Well
0
re defining what the review is
25 in the next part. "consisting of an internal CIA audit and a
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1 report to the oversight committee a8 well as such independent
2 GAO audits 38 the comittee shall direct. As part 0f its
3 annual report to the oversight Conmittee" 04 "As part of its
report to the oversight Committee, the CIA shall report, 08 and
5 then the rest of the sentence, "all its intercessions on
behalf of its proprietaries. #8
Mr Aeron_ May I just make 3 guick editorial fix? "The
Committee reconends the overight Committee conduct an annual
review of all proprietaries' consisting of an internal CIA
10 audit and report to the oversight Committee. "
11 Mr = Kirbow_ No , the Committee cannot conduct a GAO
12 audit can insist that that' s part of the report that is
13 presented to ita
14 Mr Aaron That' s, it, consisting of a report to the over
15 sight Comittee of an internal CIA audit, is that rigt?
16 Mr Kirbow. What you are trying to do is to require
17 the CIA to reveiw it, to conduct a CIA audit,. and to report
18 fully all of the review entailed _
19 Mr diGenova Not just the audit themselves , There are
20 certain operational details you are going to want to know about
21 also , not just financial security_
22 Mr
0
Kirbow . Mr . Chairman, let: uS rewrite that one . We
23 will include it.
24 Senator Huddleston Well, you see , you could combine
25 43and 2 together , since we are just going to use one sentence ,
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1 the first sentence in. No . 1 , and after we say the external
2 andcinternal controls, the oversight comittee should require an
5 annual report of all proprietaries by the CIA, including
an
internal CIA audit ana all intercessions that the CIA may have
5 made on behalf of proprietaries
6 Mr diGenova That' $ it, that' all in one sentence We
can fix that.
8 Mr . Aaron: All right. We ' 11 take Joe S fix
9 Mr Kirbow. In three I am not sure what you mean In:the
10 DCI'8 budget presentation_ 01 That almost has a word: of art
11 connotation in the Senate. A budget presentation is that
12 thing which the Secretary of Defense and the Director of the
13 CIA makes to the Appropriations Committee
8
14 Mr _ diGenova We are
talking about an authorization,
15 aren t we , an annual authorization here?
16 Mr . Inderfurth Look on page 26' and you 11 see the
17 definition of that under (b) The DCI shall have responsibilith
18 for' preparing the budget of the national intelligence program
19 for presentation_ to the President and the Congress . This
20 13 the budget presentation that'9 being.referred to under
21 this
22 Mr , Kirbow_ Well
0 now you cone to the real question,_
23 ,
proprietaries being listed in the DCI s budget presentation .
24 Most of: his proprietaries neither use any money up nor make
25 any money or anything . They are just shelf items
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Here again you come to the' notional
2 Mr _ diGenova NO , no , Charles
#
because- the point
3
made during our review out there was that never have the
proprietaries appeared in the budget presentation_ They have
been hidden , and the object is to identify them in the: budget.
a3 a line item, for example-
Mr Maxwell One suggestion might be, be listed, that;
implies a list of proprietaries _
Senator Huddleston . Where does this list
Mr Kirbow What you want to do is to require them to
10
include a discussion of the proprietaries in his annual report
11
to the oversight committee is what you want to isn €
12
it, because they don t have that now They don t report to
13
the Armed Services_Comittee. They only report to :Appropriations
14
Senator Huddleston How
would it be 'listed in the budget
15
under your
proposition here , Joe?
16
Mr diGenova Well , I"m just assuming
# well, I am
17
assuming in terns of oversight the Committee is going to want
18
to know even though this is not going to
be published
0
where
19
this money is. going and what it is. going to be used for
# 20
if they" are going to authorize it.
21
Mr _ Aaron , I think the term really should be
22
Mr Kirbowa I think it ought to be more than in the
23
24
budget .
Mr diGenova I know that S not - just what they are going
25
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1 to be asking,
0
but: the thrust of this was to make sure that
2
proprietaries found their way into the budget , ana that Senators
knew what they were authorizing when they authorized the budget.
4 Now: , how it gets in there, I am not a budget expert.
Mr. Kirbow That is what I am trying to supply here becaus
in this process there is a procedure that when you say there sha
7 be authorizing legislation
0
where the line items are discussed
before the authorizing committee and not before the budget
committee, which is the appropriations committee, and if you
10 require that he discuss or report the annual operation of the
11
proprietaries in his annual report to the oversight committee
12 You will accomplish what you are trying to 'do_ and not exclude
13 it only for the presentation before the Appropriations Comitteel
14 Mr Maxwell Could I try a fix on this?
15 Mr diGenova You are invited .
Mr Maxwell The oversight comittee should require that
16
17 the DCI 8 budget presentation to the Appropriations Committee
and the oversight committee_include a
specific discussion of
18
19 the financial aspects of CIA proprietaries_ I mean , we are
trying to bring them out and see what the' impact is on the
20
21
budget
0
where do they: fit in.
Senator Huddleston . Can they do that, though , without
22
identifying, the proprietary and where it is located and whateved
23
24 Mr diGenova They have indicated they could .
Mr Aaron Jim; Taylor , when he was; here talking to the
25
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Committee , talked about how they are beginning to drawing - a
2 way to work in' the proprietaries so that can both identifyl
3 them and indicate their cash flow implications for the budget ,
and in effect 4
5 Senator Huddleston . What would You have proprietaries
6 Mr . Aaron _ Proprietaries income and outgo_
Mr _ Kirbow But that would never be published , Senator.
If you want to accomplish what you are suggesting here
9
that they report the cash status or the financial status you
10 add that additional sentence to this combined 1 and 2 up here
11 that the Senator just proposed a minute ago , and indicate that
12 that report should also include the financial status or the
13 Senator Huddleston. But you do that with the, audit, don't
14 you, the internal audit?
15 Mr . Kirbow_ Well, in fact you do , in fact you do
16 Mr Aaron. Well,: I think the point maybe I"m not
17
captioning this properly, Joe, but I think the point here is
18
that proprietaries either earn money or cost money , sometimes
19 a little of both, and it has an impact , therefore on the
20 overall CIA budget, particularly in the past when income from
21
the proprietaries could be placed in either the contingency
22 reserve or used to finance , in effect, operational purposes
23 of the proprietary. In other words , Air America was earning
24 money on its operations
8
and yet it was costing then more
25
because they were engaged in certain risky operations _ In
5ea Ea 2
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1
In effect, the proprietary was earning money which
was
2
financing the proprietary organization_
3 Mr Kirbow But they: can no longer do that- What they
earn now must go into the general Treasury_
5 Mr Aaron . No , gross earnings do not go into the general
Treasury. Their net, and part of the cost of doing business
would include the cost of some of their operational purposes
I think the point of this inclusion here was to see if
one could require in connection with the budget , not: just in
10 general , with an audit of what it -does specifically, but in
11 terms 0f the entire activity of the CIA , to a
spelling out
12 of its sort of
macrobudget implications in ters of up" or down
13 and secondly, its budget implications for the certain categoriesl
14
of operations which were involved
0
such as, if you are talking
about the conduct of the support for the activities in Laos 15
Mr diGenova Paramilitary operations _
16
Mr Kirbow. Well, leave it like it is if that is what: you
17
are trying to do , because they Will be sure to, report it-to
18
the Appropriations Committee in excruciating detail, but they
19
won t report it to the: authorization committee unless they
20
21
require it to get money.
So if you want to leave it a detailed budget , their
22
presentation to the budget committee, this language Will get `
23
24_
that done
Senator Huddleston Well, what if you said something like
25
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1 this, furthermore, or adding to that, the fiscal impact or
2 the budgetary impact of the proprietaries should be included
3 or defined in the DCI 8 budget presentation_
4 Mr. Maxwell Specifically discussed?
5 Mr_ diGenova That, language would mean it'8 included in
his presentation in some way because_ the allusion that David
made to Jim Taylor is that they are beginning to put it into
their budget presentation. I know that is a term of arta
Senator Huddleston. That eliminates any idea of listing
10 them
11 Mr . diGenova Elliot 8 point also about the authorization
12 committee should be added in there _
13 Senator Huddleston We ve 90 much money invested ,
14 and 33 money made money and: 40 made money for a net gain of
15 S0 and s0
16 Mr Maxwell And you should have sone notion of that
17 and the problem was that you weren t able to ahold of ita
18 Senator Huddleston _ And we sold two or three of them for
19 this amount.
20 Mr diGenova . That is the whole isgue of their visibility
21 in the budget
0
the whole question_
22 Senator Huddleston . Well, where does that visibility
23 disappear?
24 Mr diGenova . Well , before they never showed up .
25 Mr Maxwell Before you had the, covert: action_
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Senator Huddleston _ Well , where: wilil: it disappear'
2 now? It won t come to the authorization committee and the
3
appropriations committee . I mean , it Won t be a line iten
Mr Aaron _ Proprietaries as a category? 4
5 Mr Maxwell. I would assume it is going to be a subsectionl
of operational support in covert action.
Mr _ Aaron . Not necessarily. I think are struggling
with that at this point trying to define it properly and how
it should be presented_ I mean , I really don t think we know
10
They have an intention to do it because recognize that
11
potentially it is a source . of real question a3 to how much
12 money is being spent on clandestinc activities: that is self-
13 generated by the Agency because of its proprietary
14
activities .
15 Mr _ diGenova : The impact, Senator, was also to show that
16 the Comittee had looked at this broadly, was aware of possible
17
budget: and authorization implications of various entities ,
18
including proprietaries , and that it wanted to say something
19 about that. Ic was not necessarily anything dramatic
20 Senator Huddleston Well, I will agree with that. I am
21 just worried about if you say you expose proprietaries too much_
22 are exposing cover
23 Mr . Aaron . Well , this is internal This is classified_
24 Mr diGenova This i5 not public
25 Mr . Maxwell _ Well, I think the language the Senator
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1 suggested got to that_
2 Mr_ Aaron _ Well, let me see if I can read out what I woula
5 propose along the lines I think we discussed.
4 The oversight comittee should require that the fiscal
5 impact of proprietaries be made clear in the DCI 8. budget
presentation to the oversight committee = If you want to ada
the appropriations committee , you can , but I think the point is
that that happens
Mr . Kirbow . If you 11 listen just one minute
0
Mr Miller
10 knows and I believe the Senator knows that "in the Senate there
11 is a formal budget presentation made to the Appropriations
12 Committees _ Ib They are not made elsewyere_ Reports are made
13 to oversight committees on the status and all of these other
14 things _
8
ana if they request any money for those proprietaries ,
15 they would request that before the authorizing committee. If
16 you are just trying: to accomplish getting it made known to the
17 oversight committee , drop the word 01 'budget presentation 08 and
18 adopt the conmon usage of the annual report of the Agency Or
19 of the DCI
20 But that is kind of a word of art. Those are words of
21 art in the Senate
0
and they will seize on it because today
22 they don t do it for anybody else but the Appropriations
23 Comnittee .
24 Senator Huddleston. I think that' $ reasonable_enough
25 It ought to be clear
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Mr Aaron Let me try another fix here because I'm
2
not too_sure
3
The, oversight committee shall require the fiscal impact of
4
proprietaries in the CIA s budget be made clear in the Director
5
authorization presentation , or what phrase is that? In the
Director' s what?
Mr _ Kirbow. The DCI 8 annual report to the appropriate
oversight committee
8,.
9
Senator Huddleston . The DCI 8 annual report _
Mr Kirbow The Agency would not report separately They
10
should make their presentation a part of the DCI}s report
11
to the appropriate oversight committee .
12
Mr. Maxwell- While we are on that, could I, on No .. 6 we
13
have already , I thought, by statute prevented any covert: action
14
being funded other than by (a) appropriation to a covert action
15
budget , or (b) the con tingency reserve
16
Mr diGenova . That' s right.
17
Mr Maxwell D oes that make No . 6 redundant?
18
Mr Kirbow . Yes.
19
Senator Huddleston_ The only comment I would make is
20
that the other is not an
accomplished fact yet. This might
21
be accepted, and that might not_
22
Mr Maxwell. Well the reason I say that is that the
23
way this reads I would have or would be opposed to it because
24
it provides an exception with the' approval of the versight
25
7aa 5 C2eD25
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1 committees , when we want, I think, to be able to go to the
2 Congress and say , we recommend most strenuously that only these
3 two methods be used for funding , rather than providing 8_ third
method' and someone says , well_ maybe we should have a_ fourth
method and I would like to go with the strongest possible
recommendation in regard to the earlier statutory requirenent
that it only be by specific #propriation to_ covert action and
the contingency reserve fund _
Mr _ Kirbow Otherwise , Mr Chairman , we will stand a
10 chance of getting the other amended;. to allow the: oversight
committee . to allow it.
12 Mr _ diGenova Why don 0 t we say this by statute, and then
13 have the rest of the, sentence an addendum which would just
14 allude to the fact that funding is to be accomplished to the
15 method we set out if you want to eliminate it.
16 Well
0
this was the problem that was raised, or an issue
17 that was raised during the study, and this is set in here
18
for that reason It can
easily be removed if it is inconsisten
19
with another recommendation of the Committee.
20 Mr Aaron . Well
8 we have two or three different earlier
21
provisions that relate to this The first i3 that re-
22
programming authority, defining reprogramming authority, the
23
possibility that something used, for a program covert action X
24 which involves a proprietary that generates a certain amount
25 of money , can be used for program Y
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l The second issue 15 we have proposed that covert actions
2 be funded either by line item or by the contingency reserve .
3 The third thing we proposed is that the contingency reserve
be replenished , if I am correct, only by appropriation,
concur-
5 rence of the oversight Committee
Now what this in effect does
#
I think the question that
he driving at is, what do you do with the profits: of
a
proprietary organization? Can you put it in the contingency
reserve?,
10 If SO , our other recommendation woula uP the notion
11 that it can be done with the concurrence of the Committee.
12 Is there gome other purpose , direct transfer? Well ,
13 presumably one of the limitations on reprogramming 33 'and this
14 would be: a
fair point to. make here, ag part of its definition
15 of limitations on reprogramming , it is recommended that the
16 oversight committee proscribe the ailocation of profits from
17 any proprietary to a covert operation without their express
18 consent _ And this is really kind of @ #
if it doesn t go , througk
19 the con tingency reserve, it really goes to the question of
20 reprogramming _
21 Now,,. I realize that we have said that our other recommen
22
dation by implication would prohibit this , but it is only
23
implication ,
0
I would think
24 Mr Maxwell My sense is that providing this
25 Mr Aaron . You kind of create a channel
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Mr Maxwell It's not that you create a channel
#
but you
2 aid the increase the temptation for the proprietaries to try
3 to .generate funds , and secondly, I think it is the easiest way
for the oversight committee to have a handle on covert action,
5 and particularly its funding, is to say there are two ways you
can do it. You can do it either the regular appropriation
process , or you can do it through the contingency reserve fund_
But if You start to build in the ways that the contingency
reserve fund can be replenished , I think people
4 I think there
10 may be a loss of control
Mr _ Aaron , Well, this is a it can be replenished
0 11
12 and this is not prohibited by anything we have recommended
13 yet.
Mr Maxwell I understand that , but I guess I was trying
14
15 to clean up the organizational structure_
Mr Kirbow I think this is the problem with recommending
16
the legislation piecemeal
0
is that the insurance company out
17
there is a covert operation. It i9 a secret operation at the
18
agency conducted in that manner , and if you allow: only
19
covert operation to be: 'funded ' only from the' contingency
20
reserve, whatever monies they generate will have to go back inta
21
the general treasury because they cannot-be used to either
22
replenish the contingency reserve or to operate a covert or
23
24 to perform a covert function or operation .
So they are not even they can't not only use the profits
25
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1 to do that, they cannot use the general monies that they
2 generate from that to conduct_ They will have to fund that
5 insurance program in the contingency
reserve
Mr diGenova No , not at all, because it is not a covert
5 operation = That is ~not being
use to fund a covert operation .
6' It has been used to pay pensions and annuities Eo foreign
agents _ It 5 not a covert operation _
Senator Huddleston Agents are covert, If you restrict
it to use of funds
0
if it is not already done_
8
no funds
10 derived from the operations of proprietaries shall be used for
11 any other purpose except the operation of the proprietary and
12 any profits shall be returned to the general treasury.
13 It precludes it
0
doesn' t it?
14 Mr = Aaron_ That would solve the problem, yes
15 Mr Kirbow And that's what are doing today- by
16 regulation_
17 Senator Huddleston. Can we say that?
18 Mr Aaron I don't see not
19 Mr diGenova Well
8
we say that in our recommendation No
20 Mr : Aaron_ Well, this says
21 Mr _ diGenova That deals with terminations and liqui-
22 dations
23 Mr Aaron. This i8 liquidations and terminations This
24 is not just operations _
25 Mr Maxwell There is one problem, a
slight problem Tha
RE 26
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18 that some 'of the profits are reinvested. It is not that
2 take everything over or break even .
3 Senator Huddleston Well, I didr t say that. I said all
4
funds not needed in the operation
5 Mr Bader Perhaps , Mr Chairman
8 you could amend No .
to all returns of funds or profits not needed for the operation
Mr _ diGenova There You go whether from liquidations
terminations or profits exceed for the needs of the operation
of the individual proprietaries should be remitted to the U.S .
10_
Treasury _
11
Senator Huddleston You can work that out So that it woul =
12
be understood that there is a need to keep a certain reserve
back
13
Mr diGenova _ We will unite 4 and 6 .
14
Senator Huddleston. That' s all but 5 . 15
16 Mr diGenova _ 5 is only about the Department of Justice
17
being. notified a3 to the disposition
Mr Aaron Now , we have two recommendations with respect 18
to cover The first is just to recommend that the Department of 19
State stop publishing data which makes it pssible to identify
20
people under cover 21
Mr , Kirbow Well, just a minute. On No . 5 I do have
22
a question here_
23
The Agency doesn t off on any other disposal of
24
25
United States properties and military bases or major edifices or
"ae 5a CE0p5n
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anything like that
2 Mr diGenova And the reason for that is every other
governmentiagency is 'subject:to the: rules and: statutes of the
Federal Disposal of ,Property Act , and the CIA isn t.
Mr . Kirbow Do you see this could be an abuse area?
Mr _ diGenova . I coula See the .Attorney General , if he
knew that Admiral Raborn or some other Director is putting
pressure on the CIA to dispose of 2 piece of property , woula
9 want to know about that , since they are not subject to the_
10 Federal Disposal of Property Act like every other government
11 agency is.
12 I don 't think I think the record clearly shows , and
13 the General Counsel indicated that he was' not opposed to having
14 outside review of their disposals
0 `
provided .it was classified
15 or done in a classified way since: have never had any
16 problem
17 Mr , Kirbow What you are doing here
0
approving the final
18 disposition of disposal , if you are intending that he review
19 the disposal process or participate in it, he wouldn t have knong
20 aboue Raborn He wouldn t have known about Raborn at all
21 because he didn t dispose of it to his client , ana this would
22 not pick up that kind of abuse that you have discussed here.
23 Mr diGenova Suppose it had been disposed of to Admiral
24 Raborn
0
and they Knew about it, and the AG said, is this
25
being done? It would raise a
red flag which would not otherwise
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be raised since the Federal Disposal of Property Act would not
2 have applied which would have flagged that legally to any other:
3 agency
4 Mr _ Aaron _ It woula also strengthen the Agency s hand to
5 resist those purposes_
0 to just simplyi say , this has to be
signed out by the Attorney General This isn't going to work
It seems to me that what we do need here
8 Mr Kirbow. If what we are trying to do is get his
participation just having him approve it doesn t get his
10 participation
0
I think we ought to put that in' if that 8 what
11 we want to do .
12 Mr = diGenova _ I think the word 10 approve m i8 rwrong . It
13 should be 0 participate. 10 The sale or disposition of any CIA
14 proprietary
15 Senator Huddleston . How are you going to make it "partici-
08 16
pate?"
17 Mr diGenova _ I think the wor we want is 01 consultation 1
18 Senator Huddleston _ I think what--we are trying to do is
19
replace what other agencies have to do in an overt' way and
20 under a specific law which this agency is not under So it will
21 have some assurance that it is being done in a" _ proper' way .
22 Mr Kirbow . I don t disagree with the AG being in on the
23 act, but this one gets you participation on disposition;
24
Senator Huddleston. Well
8
figure
a way to: get it done
25 Mr Aaron Well what I wanted to say was I would like to
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note that back on page 67 where we have struck out the reference
2 to Mr _ Raborn and intend to expand on the pressures having
3 been brought to bear part of that expansion should include
4 a statement' that there is no or that the Federal Disposal
5 of Property Act does not apply to the. CIA, which is a crucial
aspect.
Mr . Kirbow. are exempt 0
Land then bring in the
requirement for CIA or for the AG participation
9 Mr . Aaron _ And that includes that_
10 Mr diGenova So we will rewrite 5 to make it consultation
11 Ms Culbreath David, on cover, : may I just say ;didn'+
12 we decide to delete the opening 'paragraph?:
i3 Mr_ Aaron . You're right, you"re ,right.
14 Ms Culbreath_ We were just going to list the recommen-
15 dations
16 Mr diGenova Yeah , we already said that_
17 Mr Aaron NOw we have a recommendation that the
18 CIA should make an effort to place a greater proportion of its
19 officers abroad under nonofficial cover , and that recommendation
20 is in brackets . Recommendation (a)
0
that the CIA make a
21 greater effort to place a greater proportion of its officers
22 abroad , 0e under: nonofficial cover" is in brackets
23 Senator Huddleston That relates to the Welch discussion_
24 Mr Aaron . It relates to the Welch discussion and it
25 relates to the difficulties and problems of official cover,
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1 Mr Bader_ How do you feel about this , Joe?
2 Mr diGenova This is a problem because just like the man
3 says , cover is a relative thing. I don € think there is
anything wrong with saying that the CIA, that they should make
5 an effort to put 4 #
really not much of a recommendation
3 Mu
shoulh
make an effort to place a greater. proportion of its officers
abroad under nonofficial cover
0
and the . Agency does not see
that in this form wouldn t view that as a bad thing. They thi
cover is, if it is deep and effective, is okay . They just say
10 well, their answer this way , well you know you don t do
11
much work under deep , nonofficial cover, and one Of the prices
12_ you pay is you don t have a lot of operational freedom You
13 have to work hard at your regular job and you don t do a whole
14 heck of a lot.
15 The recommendation
8
the way- it is phrased =
#
is sort of a
16
push to them to see if can find better ways It also
17
probably tells them that maybe. they should use
proprietaries
18
abroad a little more, which are very , very efficient ; according
to Eric, according to both things . operations and cover 19
Mr _ Aaron, I think we have got to be careful on this
20
point. I mean , we ought to wait until the staff director
21
returns because I think he has a
particular interest in this
22
suggestion but we are
talking about moving more people into
23
unofficial cover , I would like to express my Own persional
24
reservations about that in terms of its relationship to a 25
Tod repDeT
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number of things that the Committee has already decided to do
2 Senator Huddleston. We are
eliminating
a lot of cover
3 Mr Aaron . That' 8 the first thing.
4 Now the second thing
e & and these are nonoffocial cover
5
categories . The second thing that we are doing is trying to
place somewhat greater authority in the hands of the ambassador
and the missions overseas to know what is going on . That is
something that they can do when it is in_ their house. Itis
something that' s extremely difficult for them to do when it is
10
off in the forest someplace_
11 So it is D1 and as Joe just said, it looks like a recommen-
12
dation to use more proprietaries in part because it is in the
13 same section , but in reality because that is one of the ways
they might do it, and I just wonder how much we have thought
14:
through for ourselves where the balance of our recommendations
15
16
lie, particularly since most of the stuff 18 derived basically
17
from operational experience anyway :
There was a period , toward the end of Mr Bissell' s
18
career: in the Agency , or maybe shortly thereafter , when they
19
began to try to put more people in unofficial cover and it
20
wasn t a very good experience for them.
21
Mr Kirbow David, how does the ambassador lose
control
0 22
whether it is official or unofficial
0
except that he has got
23
them in. his compound? Itlis an official government function
24
over which he has absolute control
25
7e p ceepe?
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1 Senator Huddleston . But if they Keep coming to the
2 embassy to check with. him, they blow their cover , unless they do
3 it by telephone.
4 Mr . Kirbow: Well, I don ' t think they shoula go to the
embassy at all I think their contact should become covert.
Mr _ diGenova . Well
8 we re sort of caught between a rock
and a hard place because we: know the official cover is we cover
it best;
9 Senator Huddleston. Well, we could approach in
10 that one way is to improve official covert
11 Mr Aaron . That is the one recommendation we make here
12 but the limfts on that are very
3
they are just structurai
13 like.
14 Senator Huddleston. It seems to me like we are in an
15 area that we know a lot less about than the people who are
16 in the business .
17 Mr . Aaron- That is gort of mY feeling.
18 Mr_ Kirbow We are asking them to proscribe against
19 anything- that they can convince an oversight comittee in the
20 future is essential. in the trend of that: time
21 Senator Huddleston Shouldn t we say that the time has
22 come for a whole review of cover to see whether Or not they
23 can find some better ways?
24 Mr Maxwell . We might say that the first large scale
25 study in '8 and '49 of the Agency , done by Mr Dulles , among
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L_ others ; recommended very strongly that; there be more unofficial
2 Covera
3 I think the: Agency has been under considerable pressure
4 throughout its existence to do that, and as Joe pointed out
5 there are cettain limits to what it has been able to do _
Senator Huddleston. Well, I think rather than suggest
what ought to be more or less afficial or unofficial cover , the
whole matter ought to be studied immediately by the Agency , ana
see if they can find sone new ways consistent with all the
10 restralnts and prohibitions that the Committee hag placed upon
11 them.
12 (General laughter.)
13 Senator Huddleston All right;: where: does that leave uS
14 here today 2s we close out today $ session?
15 Mr Kirbow Mr Chairman , might I suggest that in keeping
16 with an earlier discussion today, that because it is a summary
17
of findings
a8 well 38 an introduction, that perhaps while
18 we are nice and fresh, tomorrow we might take up the intro-
19 ductory section prepared by the Staff Director , So that if we
20 change it much, weleither make the rest of ur
21 Senator Huddleston Have any of the other members seen it
22 at all, Bill?
23 Mr _ Miller Just Senator Mathias
24 Senator Huddleston All right, do you want to meet: at
25 10:00 clock in the morning?
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Mr _ Aaron . Are we going to terminate now?
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Senator Huddleston. They ve got a vote going and it' s 5:10 _
I think
we d better_
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