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America's Intelligence System: Part I -
Bloated and Ineffective
by Jim Grichar (aka Exx-Gman)



This is Part I of a three-part essay on America's intelligence system. This
first part deals with what it is and how it has failed. Part II will discuss
the specific reasons for its failure. Part III will describe how it is
morphing into an instrument of a police state and, given that we are
currently stuck with a protection racket government, how we should cut the
intelligence budget down to size.


America's intelligence system has grown into a multi-agency bureaucracy that
has failed in its primary mission - to provide warnings of impending attacks
on the United States or serious threats to U.S. national security - on
numerous occasions over the last fifty years. Despite the end of the Cold
War, this mammoth system was trimmed down only marginally during the 1990's,
and now, despite its failure to predict the 9/11 attacks on the United
States by Al Qaeda, the public is being conned into spending more on this
failed system. Worst of all, it is being turned into an American version of
the former Soviet Union's Committee for State Security (the KGB), an
apparatus that our leaders will use to destroy our rights to life, liberty,
and property, all in the name of protecting us from Islamic terrorists.

What American Intelligence Does

The U.S. intelligence budget today is massive by any standard, and it is
designed more for an empire than for the defense of our nation from enemies
foreign and domestic. Educated public guesses as to the total intelligence
budget of the United States run at about $40 billion per year. And how is
this pie divided among those agencies, or members, of what is called the
intelligence community?

According to a recent article in USA Today, at least $7.5 billion of that
goes to the National Security Agency (NSA), which is responsible for signals
intelligence, including the collection and decoding of telephone and radio
messages thought to be necessary to preserving U.S. security. NSA's focus
has been on intercepting foreign communications; it supposedly does not spy
on American conversations within the country or on Americans overseas.

The second big agency feeding off the intelligence community's $40 billion
budget is the National Reconnaissance Office (NRO). Its annual budget is
probably in the range of $7 - 10 billion per year. The NRO designs, buys,
and operates America's spy-in-the-sky satellites that take pictures of
potential adversary's military assets and activities. It probably also
designs, buys, and operates satellites that can provide warnings of missile
launches. Both the NSA and the NRO are essentially run by the military,
although they provide products to other agencies in the intelligence
community.

The military also spends more money - probably another $10 billion per
year - on its own intelligence collection system. It has its own human spies
collecting information on military matters. Like the CIA, it does its own
analysis and reporting, and it is in the covert action business (i.e.,
paramilitary and other actions taken to influence or destabilize other
countries when the U.S. has not formally declared war). These functions are
carried out mainly through the Defense Intelligence Agency (DIA, the
military's answer to the CIA, was started by Robert Strange McNamara after
the CIA's Bay of Pigs fiasco) and the specific intelligence components of
each of the four military services. More recently, in 1986 the Congress
created the Special Operations Command (SOCOM), a high level Pentagon unit
designed to support, manage and coordinate the activities of such groups as
the Delta Force, the Navy Seals, the Green Berets, and other classified
covert-action type components.

Next on the list of intelligence organizations is the Central Intelligence
Agency (CIA), with a budget of roughly $4 - 6 billion, if not more. CIA is
supposed to integrate and analyze information from all sources to produce a
coordinated analysis (that is, the results are "agreed to" by other
departments and agencies so that one view is sent to the president) of
important foreign intelligence questions that affect U.S. national security.
CIA uses spies to gather additional information on foreign governments and
apparently is also still involved in covert action, given the news that its
operatives are involved in the war on terrorism around the world. Recent
press accounts of a CIA unmanned aircraft firing a missile to kill some Al
Qaeda terrorists in Yemen - including one that was an American citizen - are
further indications that CIA is back in the business of conducting
paramilitary operations (much likely to the chagrin of the power-hungry
Donald Rumsfeld and his Pentagon lickspittles).

Other organizations, such as the State Department's Bureau of Intelligence
and Research (I&R), and the FBI's national security apparatus, which is
supposed to hunt down spies and terrorists within the U.S., also spend money
on the intelligence mission.

While this massive outlay on intelligence might have been justified during
the Cold War (the threat of thermonuclear annihilation certainly existed),
the current threat climate, even including that from Islamic terrorists,
should lead most people to question the size of the intelligence budget and
how it is being spent. Even more important is the fact that major
intelligence failures have occurred over the years, and this should cause
citizens to demand, at the minimum, a thorough review, housecleaning and
downsizing, redesign, and reorganization of the intelligence community.

What Should Intelligence Do?

The rationale for producing intelligence - collecting information, analyzing
it, and then disseminating it to those who can make decisions based upon
it - is basically an exercise in applying the economics of information.
Gathering, analyzing and disseminating better information should help reduce
costs associated with an activity. In this case, intelligence should have
improved the national security of the United States and allowed us to avoid
wars and spend less on defense. (Note that covert actions - political and
military assassinations, including those designed to get rid of terrorists,
and other activities designed to destabilize other countries - are not, in
the strict sense of the term, intelligence activities.) Thus, intelligence
activities should more than pay for themselves.

During the Cold War, properly used and focused intelligence should have
enabled the United States to minimize military outlays by reducing
unnecessary and wasteful defense spending. Used properly, intelligence
should have helped focus U.S. defense resources on those programs most
likely to deter an adversary, and, if necessary, to win a conflict. While a
significant part of the intelligence budget was apparently used this way, it
is obvious that our political leaders were also interested in building a
worldwide American empire based upon a vast and overwhelming military
superiority used to influence events around the world. While Americans were
protected from the Soviet Union and China during the Cold War, it is obvious
that they paid an extremely high and excessive price for that protection.

Intelligence Failures

Despite this massive outlay on intelligence, the U.S. has had numerous,
significant, and almost continuous intelligence failures since World War II.
While no one bats 1.000, the scope and extent of such a large government
operation is bound to produce many serious failures. At the risk of being
pedantic, I offer the reader this lengthy list of failures that includes,
but is certainly not limited to: 1) failure to predict the Soviet
acquisition of the atomic bomb, the Iron Curtain, and the Berlin blockade;
2) failure to predict China's entry into the Korean War; 3) the CIA's
MK-Ultra project, in which U.S. Army scientist Frank Olson was given LSD
unwittingly and Olson's subsequent (according to information made public by
the CIA) suicide; 4) failure to predict the Soviet space effort, starting
with Sputnik and the failure to point out that there was no U.S. missile gap
vis-a-vis the Soviet Union. You can arguably add the May 1960 Soviet downing
of Francis Gary Powers in a CIA U-2 to this failure; 5) failure to predict
the Berlin Wall; 6) various CIA-backed coups designed to prop up
U.S.-friendly dictators in Latin America and elsewhere, that, although
sometimes initially successful, always came back to haunt the U.S.; 7) the
Bay of Pigs fiasco, a CIA covert action designed to overthrow Fidel Castro
and his budding communist regime; 8) failure to predict the Cuban missile
crisis, which brought the U.S. to the brink of thermonuclear war; 9) the
failure to predict the Soviet invasion of Czechoslovakia in 1968; 10)
failure to predict the Arab oil embargo in 1973, which followed the Egyptian
attempt to recover the Sinai peninsula it lost to Israel in the 1967 war, an
event that almost brought the U.S. and the Soviet Union to a thermonuclear
confrontation; 11) failure to predict the abdication of the Shah of Iran in
1979, his replacement with an Islamic cleric-run regime, the taking of
American hostages from the U.S. embassy in Tehran, and the subsequent oil
crisis; 12) the failure of the Delta Force to rescue those hostages from
Iran; 13) failure to predict the Soviet invasion of Afghanistan in late
1979; 14) failure to predict and prevent the bombing of the U.S. Marine
barracks in Beirut in 1983; 15) failure to predict the economic and
political collapse of the Soviet economy during the 1980's, which led the
U.S. to spend billions of dollars on unnecessary defense spending; 16) an
apparent failure to predict that Saddam Hussein would invade Kuwait; 17)
failure to predict the bombing of the World Trade Center in 1993, bombings
of U.S. embassies in Africa, bombing of the U.S.S. Cole in 2000, and the
terrorist destruction of the World Trade Center and attack on the Pentagon
on September 11, 2001; and, 18) failure to prevent numerous Americans from
spying on the U.S. for Russia, China, and assorted other countries.

Intelligence insiders and apologists will admit that intelligence operations
are risky by their nature, they will generally claim that America's
intelligence apparatus helped the U.S. win the Cold War and had countless
other successes that cannot be revealed. What these insiders will never
admit is that the intelligence establishment had an inordinately high
failure rate given the mammoth resources at its disposal. No private firm
could have survived such a high failure rate; it would have gone bankrupt or
been subject to a takeover and reorganization.

Next: Part II: Why It Has Failed

November 21, 2002

Jim Grichar (aka Exx-Gman) [send him mail] was an economist with the federal
government. He writes to "un-spin" the federal government's attempt to con
the public, whether through its own public relations organs or via the usual
stooges and dupes in the mainstream media.

Copyright © 2002 LewRockwell.com