Part 8: Wedge...Smoking Gun...Blowback

WEDGE 

FROM PEARL HARBOR TO 9/11 

HOW THE SECRET WAR BETWEEN THE FBI AND CIA 

HAS ENDANGERED NATIONAL SECURITY 

by MARK RIEBLING 

15

Smoking Gun

A WET HAZE OBSCURED the Goddess of Freedom atop the United States Capitol on May 3, 1972. At the base of the building a black automobile braked gently to a stop; it was a hearse. Eight Marine pallbearers started slowly up the thirty-five steps, bearing the flag-draped coffin past a column of honor guards. A drizzle thickened to rain, and the Marines almost lost their footing; two suffered ruptures as they struggled up. But they reached the bronze doors of the Rotunda, and then were under the awesome dome. There, upon the catafalque once built for Abraham Lincoln, they placed the body of John Edgar Hoover, dead from heart failure the day before. 

A few hours later, as Hoover lay in state, an antiwar demonstration began on the steps outside—and then a demonstration against the demonstration. As actress Jane Fonda took the megaphone, there moved also along the margins of the crowd nine Miami Cubans, hired by the Plumbers to be ready to repulse a rush for Hoover’s casket. But the only trouble occurred when the Cubans, who could not contain themselves, got into scuffles while shouting “Traitors! Castro-lovers! Communists!” 

The Cubans’ leader, Eugenio “Macho” Martinez, recounted those details proudly to his controllers, G. Gordon Liddy and E. Howard Hunt, who drove over afterward and picked him up. It was getting dark as they headed down Virginia Avenue and Liddy pointed to the complex of structures called Watergate. 

“That’s our next job, Macho, ” Liddy said. 

“What is it?” 

“Democratic National Headquarters—and after McGovern’s nominated, it’ll be his headquarters, too.” 

“There’s a report, ” Hunt broke in, “that Castro’s been getting money to the Democrats. The idea is to photograph the list of contributors the Democrats are required to keep. Once we have those lists, we can have them checked to determine whether the contributors are bona fide or merely fronts for Castro or Hanoi money.” 

They drove on into the night, plotting how to tie domestic antiwar personalities to foreign communists— precisely what the feuding FBI and CIA had largely failed to do since 1967. That failure had caused creation of the Plumbers, as has been seen, but the FBI-CIA wedge was to figure even more fundamentally in White House attempts to cover up the Plumbers’ crimes, causing the worst political scandal in American history. 

AMERICA’S DOWNHILL SLIDE to Watergate had really begun shortly after Nixon assumed office, when he ordered White House counsel John Ehrlichman to get all the “facts and documents” about CIA’s plots to remove Castro. As vice-president, Nixon had played a catalyzing role in the Bay of Pigs plan, of which the Maheu/Giancana plot had been one aspect. Though assassination had not been formally “authorized” by the White House before Kennedy came along, the push to get rid of Castro had really begun in April 1959, when Nixon’s executive assistant for national-security affairs, General Robert E. Cushman, began pressuring CIA for “action” on the Castro problem. The result had been the Bay of Pigs, secret deals with the Mafia, and, eventually, the 1967 report by CIA’s Scott Breckenridge, which had caused LBJ to believe that President Kennedy was killed by Castro in a “turnaround plot.” But by summer 1969, six months after Ehrlichman had asked CIA for all it had on the Castro operations, the Agency had still not handed over the Breckenridge Report. Ehrlichman had complained to Haldeman, “Those bastards in Langley are holding back something. They just dig in their heels and say the President can’t have it. Period. Imagine that! The Commander-in-Chief wants to see a document, and the spooks say he can’t have it. From the way they’re protecting it, it must be pure dynamite.” 

In an attempt to pry the secrets loose, Nixon named Cushman, the very former staffer who had been his liaison with CIA on anti-Castro matters, to be the Agency’s deputy director. This produced a Helms visit to the White House, during which Ehrlichman hoped that Nixon would give a direct order “to turn that document [i.e., the inspector general’s anti-Castro report] over to me.” After Helms’ long secret conversation with Nixon, however, Ehrlichman had appeared in Haldeman’s office, dropped into a chair, and just stared furiously, speechless. When asked what happened, Ehrlichman had finally said, “I am now to forget all about that CIA document. In fact, I am to cease and desist from trying to obtain it.” 

But by 1972, the matter had come up again. Robert Maheu, who had been CIA’s go-between for Rosselli and Trafficante, was a close friend of Democratic National Committee chairman Lawrence O’Brien. The Cuban security service must have good evidence of attempts against their leader’s life, and Castro himself would probably do all he could to help the progressive McGovern, including pass evidence of anti-Castro plots undertaken on Nixon’s watch. The Democratic Party also encompassed Johnson staffers who must have known of the Breckenridge Report, and who knew that LBJ thought it implicated a vengeful Castro in JFK’s death. If the anti-Castro plots could have caused Kennedy’s assassination, and if Nixon had in part caused the anti-Castro plots, Nixon might then be blamed by the Democrats for causing the Dallas tragedy. 

To ensure that Nixon would not be hit with any such “surprise” allegations, two countermeasures were adopted. First, as a moral equalizer and counter blackmail device, Hunt tried to prove that JFK had ordered the 1963 assassination of South Vietnamese President Diem. Examining Saigon-Washington cable traffic, Hunt noticed that, “the closer one approached the assassination period, the more frequently were cables missing.” So Hunt decided to “improve” the existing cables with a razor blade and a Xerox machine, until he came up with something more “incriminating.” 

Second, it was decided to burglarize the Democratic National Headquarters at the Watergate Apartments complex, to see how much the opposition really knew about the anti-Castro plots. As burglar Frank Sturgis later explained: “One of the things we were looking for in the Democratic National Committee’s files, and in some other Washington file cabinets, too, was a thick secret memorandum from the Castro government addressed confidentially to the Democrats’ platform committee. The Cubans were providing an itemized list of all the [CIA] abuses. The complaints were especially bitter about various attempts to assassinate the Castro brothers.” 

From the start, there had been one great obstacle to such a precipitous act as breaking into Democratic headquarters: the fear that Hoover’s FBI would not look the other way if the Plumbers were caught. But Hunt and his henchmen could assume a new boldness in May 1972, when Hoover was finally gone. 

SECRETARIES AND ADMINISTRATIVE assistants at FBI headquarters had begun to cry at the announcement of the director’s death, while numbed G-men tried to comfort them. Looking back, most FBI men would find it difficult to assess their exact feelings. Few felt any sense of personal loss; Clyde Tolson had been Hoover’s only real friend. Nor had the director been an easy man to work for; he was tough and irascible and would not accept even 98- percent perfection. He was, however, respected and admired as few men ever would be. He had been a fierce fighter for justice, and for the old America that seemed in danger of passing with him. For all his flaws, he had made the FBI into the finest law-enforcement agency in the world. It just did not seem possible that such a man could leave the scene so suddenly. 

This was the uncertain atmosphere into which ex-submarine commander L. Patrick Gray, the new FBI chief, was now thrust. A hardworking, methodical Connecticut lawyer, Gray had been a Nixon organizer in 1960 and a sort of man Friday to the 1968 transition team, working all day at stand-up desks until he was made an assistant to the attorney general. On the morning after Hoover’s death, when people were sitting around the office of Acting Attorney General Richard Kleindienst, considering who should be named FBI director, someone suggested, Why not Pat Gray? After Nixon’s difficulties with the independent, unyielding, world-famous Hoover, the president must have liked the idea of a loyal, teamplaying unknown. At two-fifteen on the afternoon of May 3, Gray was called into the Oval Office, shook the president’s hand, and heard him say, “I am going to name you Acting Director of the Federal Bureau of Investigation.” 

Gray was honored but deeply surprised, since his relationship with the president had been marginal and impersonal. In retrospect, Gray thought that he should have called to mind the old adage about things that seem too good to be true … But at the time, he looked upon his new job as a return to the service of his country, analogous to that which he had rendered in the Navy. And, like a good ship’s captain, he moved immediately to avoid a mutiny among his men. 

“Frankly, most of us were hoping that the President would select an insider, ” Mark Felt told the new director. That was true enough, though actually Felt had been hoping that he would be the new director, as had a clutch of other top Hoover deputies. None of them would be of much help to Gray as he tried to learn how things worked, and no one told him anything unless he asked; no one bothered to inform him that the two little red buckets under his desk were burn baskets, or that his office included a shredding machine. Gray fought back by winning the allegiance of special agents in the Bureau’s field offices. 

“He was a dynamic guy and went around making speeches, ” recalled special agent Jay Aldhizer. “He said, ‘We are going to make some changes, you don’t have to wear white shirts anymore. You can drink coffee at the desk.’ There was a very definite relaxation, immediately. Gray wanted to create something new, and get us looking toward the future, and for a little while there was a real sense of renewal.” 

There was also an instant opening up to CIA. With Hoover gone, the way was clear for an official restoration of liaison, both at headquarters and in the field. Indeed, with Hoover dead, and total interface permitted, the need for a liaison officer was no longer so clear-cut; instead of going through a single middleman, such as Papich, personnel dealt with their opposite numbers at the other agency. Hence, despite the dire significance once attached to Hoover’s scrapping of the liaison-officer position, it would be some months before Gray appointed a new liaison man. 

But new tensions with CIA were not so long in coming. Gray was on a morale-boosting mission to the FBI’s Los Angeles Field Office on Saturday, June 17, when he got a call from Felt, who had replaced Tolson as the Bureau’s number-two man. “At approximately 2:30 this morning, ” Felt recalled telling Gray, “a security guard at the Watergate complex noticed a partially open basement stairwell door which had tapes placed across the spring bolt to prevent it from locking. He removed the tape but when he saw the same door taped again about forty minutes later, he telephoned the police at once and they were on the scene within minutes. The police surprised and arrested five individuals at Democratic headquarters and they were identified as James Walter McCord, Jr., Bernard L. Barker, Frank Anthony Fiorini, Virginio R. Gonzales, and Eugenio Martinez. They had in their possession burglary tools and photographic equipment. Several ceiling panels had been removed, as well as an air vent cover. They had been taking apart the telephone equipment. All of them were wearing surgical type plastic gloves. It looks like they were getting ready to install more eavesdropping equipment or to repair or put new batteries in equipment already there.” 

“Have they said what they were doing?” Gray asked. 

“They haven’t said one word. Trying to get information from these people is like trying to interview the Black Panther Party. They didn’t even call an attorney but one showed up anyway. It’s very mysterious.” Felt added that the arrested men had been carrying $2,400 cash, including three new hundred-dollar bills, and that a search of their rooms at the Watergate had turned up thirty-five crisp new hundreds of the same series. Also found was an envelope containing a personal check made out by E. Howard Hunt. The FBI knew Hunt had been a CIA employee, and had worked on “highly sensitive matters” for the White House, but was now officially with Mullen Company, a private security firm. 

None of it made any sense to Gray. Obviously the police had broken up some kind of political-espionage business, but he wondered, for no reason he could name, whether there wasn’t more to the affair. He was haunted by the thought that somehow the Watergate burglary was connected to CIA. 

☎💈🚧

THE CENTRAL INTELLIGENCE AGENCY first heard about the Watergate break-in, according to its own records, at 5 p.m. that Saturday afternoon, when an inquiry about the arrested men was received from reporter Bob Woodward at the Washington Post. That call was soon followed by one from the FBI, advising that McCord and Hunt had been identified as former officers of CIA. By 8:45 p.m., the case had been taken to Director of Security Howard Osborn. It was one of Osborn’s routine duties to inform Helms of any trouble in the extended Agency family, and that included events like suicides, break-ins, rapes, and other bad things that happened in a big city like Washington. But when Osborn called Helms at 10 p.m. that evening, the DCI knew that this episode was different; he sensed, he later said, that the Watergate affair would be “big news from the moment it happened.” Not only were Hunt and McCord former CIA officers, but all of the Miami Cubans had worked for the Agency during the Bay of Pigs episode, and one of them was still a contract agent on the payroll. 

Ideally, Helms would have liked to settle the matter quietly, without publicity, according to the 1955 agreement between CIA and Justice, which called for the Agency to investigate its own. But that agreement applied only to current Agency employees, and in any case the incident was already public knowledge. All Helms could do, for the moment, was to call Gray, disavow any knowledge of what the Agency’s ex-employees were up to, and warn: “These fellows may have some connection with Ehrlichman. You’d better watch out.” 

Monday morning, at his regular 9 a.m. staff meeting, Helms went around the table on the break-in. Cord Meyer, sitting in for DDP Karamessines, remembered “a unanimous expression of total ignorance and surprise, ” but also “general concern that the public and press would suspect some Agency involvement because of Hunt’s and McCord’s past connection to the Agency.” To prevent that from happening, Helms set out a fundamental strategy. “Stay cool, stay clean, keep away from this, ” Helms said. “Volunteer nothing, because it will only be used to involve us.” William Colby, Helms, announced, would deal with outside parties seeking cooperation from CIA. According to Colby’s own account, Helms asked him to “coordinate the Agency’s efforts” in deflecting public suspicions of a CIA role in the affair. 

Just such a deflection of suspicion away from CIA was accomplished by Deep Throat, a source who began feeding leads to Post reporter Woodward, by the reporter’s own account, on June 19—only hours after Helms launched CIA’s damage-control plan. Woodward’s later description of Deep Throat as having “an aggregate of information flowing in and out of many stations” would seem a pointed signal to someone in Langley. Woodward also said that Deep Throat had an “extremely sensitive” position in the Executive Branch, which would perfectly fit someone at CIA, who (according to Woodward) did not like getting calls at the office. The use of an underground parking garage for clandestine meetings would seem to evidence a certain skill at “tradecraft.” Furthermore, with the exception of Helms and his DDCI, CIA officers were not political appointees, and therefore their careers, unlike those of Dean and most other possible Throats, would not have automatically fallen with Nixon’s own. Woodward himself would later all but confirm that Deep Throat was a spook. “As you know, I’m not going to discuss the identity of Deep Throat or any other of my confidential sources who are still alive. But let me just say that [the] suggestion that we were being used by the intelligence community was of concern to us at the time and afterward.”

Could Deep Throat have perhaps been Colby? Much of the information Colby provided to the FBI in the days after the burglary was immediately leaked to the press, as Colby later admitted, though he blamed those leaks on the Bureau. Colby was a political liberal, and no great fan of the Nixon White House; as Helms’ damage-control officer on Watergate, he would be perfectly positioned to leak; he was later rumored to use underground parking structures for secret meetings of a personal nature. Moreover, the final pages of Colby’s 1978 book, Honorable Men, would contain a suggestive reference to Throat. Discussing how “the public must be informed of what intelligence is doing in its name, ” Colby cites “unofficial leaks” as one means of so informing the citizenry; sometimes material is made available to the media though “its source in the intelligence community is obscured from the people who use it.” Colby then immediately raises the subject of Deep Throat, and although one might expect him to resent the role of Throat as a competitor in controlling public perceptions of Watergate, he actually characterizes Throat as a force for national good: “Deep Throat remains a secret, ” Colby says, “but the public has benefitted from his information.”

Woodward’s clues suggest, however, that Throat was more likely another CIA officer present at the June 19 damage-control meeting. This was Cord Meyer. Woodward describes Throat as a chain-smoker and heavy drinker, which Meyer was and Colby was not. Throat was an intellectual who “knew too much literature too well, ” and Meyer was an award-winning literary talent. Throat’s appearance bespoke “too many battles, ” and Meyer had a glass eye from the Battle of Iwo Jima. Meyer also reportedly bore a special grudge against Nixon because of his complicity in the McCarthyist drama which had once almost cost Meyer his CIA job; he was even said to have made digs at CIA secretaries who wore Nixon campaign buttons on their blouses. Meyer was practically a charter member of the Old Boys Network of Yale graduates who had gone on to work in intelligence, and Woodward, too, was a member of this club. In fact, Meyer may well have become acquainted with Woodward during the latter’s 1969-70 tenure as a Washington briefer in naval intelligence: as part of his daily rounds, Woodward sometimes addressed top people in CIA’s Department of Plans, where Meyer was then the number-two man. Moreover, Throat knew all about Hunt’s activities—his first tips and most of his early leads concerned Hunt—and Meyer was one of the few at CIA who knew, even before the Watergate burglary, that Hunt was working for the White House. On March 27, 1972, for instance, when CIA’s domestic contact office in Miami queried Langley about Hunt’s frequent contacts with Cuban exiles, Meyer cabled back that Hunt was in Miami on White House work and that Miami Station should “cool it, ” i.e., not concern itself with Hunt. Meyer, it should also be noted, possessed great family wealth—his father controlled a lot of real estate in Manhattan—which would explain why Throat could afford not to come forward for big bucks (the advance for his book even now, two decades later, would be colossal). But perhaps most important, Meyer had extremely intimate connections with Ben Bradlee, Woodward’s boss at the Post. Indeed, they were in-laws, having both married sisters from the socially prominent Pinchot family. Meyer’s interface with Bradlee could have had a close professional aspect as well, since Meyer’s main duty at CIA was to penetrate and influence leftist but anticommunist organs of opinion. Among other things, Meyer’s close relationship to the editor of the Post might have accounted for the special access that allowed Throat to get to Woodward’s morning copy of the Post and scribble on it times for secret meetings.

In any case, while Deep Throat, whoever he was, deflected press attention from CIA, Colby deflected requests from the FBI’s Alexandria office for information on the burglars. “The immediate problem, ” Colby recalled, “was how we could give the FBI facts about the activities of former CIA personnel without revealing the operational jobs they had done in the past and the people with whom they dealt. We had to be concerned with the protection of legitimate operational secrets and with ensuring that the Agency was not dragged into something it had nothing to do with while responding to quite appropriate FBI inquiries.” As he was “pondering this problem, ” Colby was informed that Howard Hunt had received a red wig and miniature camera from CIA during summer 1971; Colby and Helms then determined to conceal this information from the Bureau. “Neither Helms nor I saw any need to volunteer this information to the FBI, ” Colby conceded, “since it did not have anything to do with the Watergate break-in a year later. Our strategy, Helms stressed, was to respond to legitimate requests by the investigators for information on the individuals involved in Watergate or any other directly related questions. But we had no obligation to rush forward with peripheral information not significant to the investigation at hand and likely to create misunderstandings and public excitement about a possible—and nonexistent—CIA role in the activity under investigation.”

At month’s end, Helms affirmed that his strategy required not being overly helpful to the Bureau. Leaving aside the White House’s concerns, Helms did have some real worry about FBI inquiries into Hunt, who, if not acting on CIA’s behalf when working for the Plumbers, nevertheless had many Agency friends and connections. These were not the things the White House wanted covered up, but Helms did not want them volunteered. “In short, ” Helms directed, “it is up to the FBI to lay some cards on the table. Otherwise, we are unable to be of help. In addition, we still adhere to the request that they confine themselves to the personalities already arrested or directly under suspicion and that they desist from expanding this investigation into other areas which may well, eventually, run afoul of our operations.” 

Unsurprisingly, that policy caused the Bureau to believe that CIA was being “less than cooperative, ” as Felt recalled, “with inquiries from the FBI running into a stone wall or, worse still, encountering outright deception.” When CIA got a tip on June 19 that burglar Eugenio Martinez’s car had been left at Miami Airport, it waited two days before informing the FBI, probably so as to “sanitize” the car of any “compromising” data about Martinez’s relations with the Agency. When the FBI asked to interview Martinez’s CIA case officer, Robert Ritchie, they were told, first, that he had gone on an “African safari, ” then that he had been reassigned to Indochina and would not be available for questioning. And when the Bureau asked about a “Mr. Pennington, ” who had reportedly once been James McCord’s supervisor, CIA furnished a summary on Cecil H. Pennington, a former employee who had no connection with McCord. The lead turned into a dead end for the FBI, just as CIA had hoped; it was more than a year before the Bureau learned that the man they wanted was Lee R. Pennington, a contract agent for CIA’s Security Research Staff, who on June 21 or 22, according to the later sworn testimony of an Agency security officer, had “entered Mr. McCord’s office at home, destroying any indication of connections between the Agency and Mr. McCord.” When confronted on such matters by Mark Felt, Colby airily brushed aside the FBI man’s complaints by saying that “we were trying to keep publicity away from CIA.”

DESPITE CIA’S PATENT LACK of cooperation, a detailed investigative report on the Watergate incident was waiting on Pat Gray’s desk at 7:45 a.m. on June 20, when he returned to headquarters from California. The Bureau now knew that the burglars’ cash came from the Mexican bank account of one Kenneth Dahlberg; it was also known that Eugenio Martinez was on a “retainer of $100 per month” from CIA “to report on the Cuban exile community.” Thus, the “money chain” seemed to involve, at its near end, a current CIA contract agent and several ex-CIA officers, while leading overseas, into CIA’s jurisdiction. 

Gray telephoned Helms: could he confirm or deny that CIA was involved? 

Helms could deny. He said that he knew nothing about Dahlberg or the Mexican bank, and that Martinez, though under contract to CIA, had not been acting on Agency orders during the burglary. Just as the FBI couldn’t control all its stool pigeons in the underworld, or be held accountable if an FBI informant “whacked” a rival casino owner, so a CIA contract informant like Martinez could get into all kinds of trouble on his own—could beat up his girlfriend, steal a car, or burglarize a building—but that didn’t mean he was doing it at Agency behest. Similarly, Hunt’s and McCord’s former work for CIA did not mean that Helms had any way of “keeping a string” on them. When they walked out the door, “they turned in their badge”; the notion that one never really “retired” from CIA was a false if widely held myth. 

Gray murmured that he understood, but Helms sensed his message wasn’t getting across very well. In Gray’s mind, as in that of the public, distinctions between current and former, or between contract and full-time, employees didn’t really make any difference. Helms knew that, and yet he was surprised that the issue kept coming up. He couldn’t understand why Gray kept thinking that CIA was somehow involved. It seemed strange. 

THE PRESIDENT of the United States had been sitting in his boxer shorts, sipping coffee in the kitchen of his vacation home in Key Biscayne on Sunday morning, June 18, when he saw a small article about the Watergate burglary on page 30 of The New York Times. Two decades of investigation would uncover no evidence that Nixon or any of his advisers knew about the burglary in advance, but if Hunt and Liddy were perhaps schooled enough in notions of deniability and compartmentation to keep their bosses “clean, ” by the evening of June 20, their first night back in Washington from Key Biscayne, the Plumbers’ bosses were dirtying themselves, conspiring to cover up White House links to the crime by playing CIA against the FBI. As a lever, to force CIA into cooperation, the White House would use its knowledge of an operation which had gone wrong, perhaps tragically so, because of lack of coordination between the rival agencies. 

It began with cryptic hints from Nixon. Haldeman was at home unpacking, he later said, when he got a call from the president. They talked about Watergate. The president said: “Tell Ehrlichman this whole group of Cubans is tied to the Bay of Pigs.” 

“The Bay of Pigs?” 

“Ehrlichman will know what I mean.” 

As he drifted to sleep that night, a puzzled Haldeman considered the president’s suggestion. He recalled Ehrlichman’s failed attempts to get the Breckenridge Report from CIA, and wondered, as had Ehrlichman, what could be “pure dynamite” about the Agency’s attempts to unseat Castro. 

The next morning, after the regular White House staff meeting, Haldeman followed Ehrlichman to his office and gave him the president’s message. Ehrlichman’s eyebrows arched, and he smiled. “Our brothers at Langley? He’s suggesting I twist or break a few arms?” Ehrlichman leaned back in his chair, tapping a pencil on the edge of his desk. He paused for a long beat, then said. “All right. Message accepted.” 

Haldeman heard nothing more on the matter until the morning of June 23, when he met Nixon in the Oval Office, alone. Their talk was secretly recorded, by a White House taping system, recently installed to help detect leaks; by keeping a verifiable log of who had heard what from the horse’s mouth, Nixon hoped to be able to confront leakers with irrefutable proof. “Now on the investigation, you know, the Democratic break-in thing, ” Nixon said, “the FBI is not under control, because Gray doesn’t know exactly how to control them, and they have —their investigation is now leading into some productive areas, because they’ve been able to trace the money.” Specifically, the FBI had implicated campaign contributor Kenneth Dahlberg. But Gray’s apparent belief that Dahlberg was connected with CIA suggested to Nixon a way out. “The only way to solve this, and we’re set up beautifully to do it, is for us to have [Deputy Director of Central Intelligence Vernon] Walters call Pat Gray and say, ‘Stay the hell out of this. This is, ah, business here that we don’t want you to go any further on.’ That’s not an unusual development. ‘We’ve got a signal from across the river to, to put the hold on this.’ And that will fit rather well because the FBI agents who are working this case, at this point, feel that’s what it is. This is CIA.” 

But was it CIA? Haldeman wanted to know. Nixon was “not sure” whether Watergate was, in fact, a “CIA thing, ” but he thought it was a good plan—and CIA would roll over when told. “We protected Helms from a hell of a lot of things, ” the president said. “Hunt—that will uncover a lot of things. You open that scab there’s a hell of a lot of things and that we just feel it would be very detrimental to have this thing go any further. This involves these Cubans, Hunt, and a lot of hanky-panky that we have nothing to do with ourselves.” Haldeman didn’t know what hanky-panky he was talking about, but Nixon wasn’t finished. He gazed out the window, then turned to Haldeman. “Play it tough. That’s the way they play it and that’s the way we’re going to play it … They should call the FBI in and say that ‘We wish for the good of the country don’t go any further into this case.’ Period.”

As Haldeman left the Oval Office, the doors opened and a motion-picture camera crew entered. They were making a film for screening at the Republican Convention, and they wanted to get some footage of Nixon functioning at his finest as president, on a typical glorious day, discussing great problems of state. No one would know that they were seeing the man one minute after he began the massive cover-up that would cause his downfall and disgrace. 

“Guess what, ” Haldeman said to Ehrlichman, meeting up with him in the hall outside. “It’s Bay of Pigs time again. The man will never quit.” He explained that they were to meet Walters and Helms as soon as they could, and play the Cuban card, to force Walters into calling off the FBI. 

“Well, the President has a point. It will put pressure on Helms. But this time you’re going to push the red button, not me. I’ve had it on that route.” 

The red button? Haldeman still had no idea what all this meant. He figured that Helms would know, but wondered if Walters, who was new to CIA, would also understand. 

THREE-STAR GENERAL Vernon Walters was the Orson Welles of American intelligence—a portly, cultured epicure who could hold forth fluently in any one of eight languages while consuming impressive amounts of food and wine. As a defense attaché and official government interpreter, Walters had been with then Vice-President Nixon in Caracas when a crowd stopped their car and started breaking the windows, and had been struck by the courage and calmness Nixon showed while they waited for Venezuelan guardsmen to clear the riot. As he entered the White House on June 23, with Richard Helms, Walters sensed that he was going to be asked again to serve Nixon, but he also sensed a certain tension among the President’s men. There was the usual shaking of hands as they entered, but no small talk. 

Haldeman started right in by saying that Watergate was “creating a lot of noise, ” causing problems that “the opposition” was “attempting to maximize.” The FBI investigation might lead to “some important people … in Mexico.” 

After a pause, Haldeman asked Helms what the “Agency connection” was in Watergate. 

“We’re not connected, ” Helms instantly said. His tone was of injured innocence. “No sir, no way.” Indeed, Helms had twice told Director Gray by phone that there was no CIA involvement. Nor did Helms think CIA operations would be jeopardized by the FBI’s inquiries. 

“Nevertheless, ” Haldeman said, turning to Walters, “it is the President’s wish that you, General Walters, go to see Director Gray, and tell him that the further pursuit of this investigation will uncover some activity or assets of the CIA in Mexico. Tell him that if he pursues the Mexican part of the financing of this business it will uncover CIA assets or schemes for moving money.” 

Helms began to protest, but Haldeman cut him off. 

“The President asked me to tell you this entire affair may be connected to the Bay of Pigs, and if it opens up, the Bay of Pigs may be blown, and the FBI may uncover some things that—” 

Total chaos in the room. Helms clutched the arms of his chair, jutted forward, and screamed: “Don’t throw that dead cat at us! Bay of Pigs has nothing to do with this! That was years ago! I have no concern about the Bay of Pigs!” 

Dead silence. Jesus Christ, Haldeman wondered, What was such dynamite in the Agency’s attempts to get rid of Castro? 

“I’m just following my instructions, Dick. This is what the President told me to relay to you.” 

Helms was settling back, trying to calm himself. “All right, ” he said at last. The whole atmosphere had changed; Nixon had sure been right about the Agency’s attempts to remove the Cuban leader. 

“What is the purpose of this?” Helms cautiously asked. 

Ehrlichman, who previously had only nodded or smiled in agreement with Haldeman, said simply: “General Walters should get down to see Gray just as fast as he can.” 

Walters said nothing. Helms rose. The meeting was over. 

Haldeman went back to see the president and informed him that his strategy had worked. Nixon smiled grimly. He did not tell Haldeman why mere allusion to the Agency’s anti-Castro operations could be used, in essence, to blackmail CIA, but three years later, when CIA’s Cubela Trafficante assassination plots were investigated and publicized by the U.S. Senate, Haldeman finally thought he knew. These operations contained in them the Agency’s “High Holy, ” its darkest, most damaging secret. As Haldeman surmised: 

It seems that in all of those Nixon references to the Bay of Pigs, he was actually referring to the Kennedy assassination. As an outgrowth of the Bay of Pigs, CIA made several attempts on Fidel Castro’s life. The Deputy Director of Plans at CIA at the time was a man named Richard Helms. Unfortunately, Castro knew of the assassination attempts all the time … After Kennedy was killed, CIA launched a fantastic cover-up. Many of the facts about Oswald unavoidably pointed to a Cuban connection … CIA literally erased any connection between Kennedy’s assassination and CIA. 

Haldeman figured that Nixon must have learned about this High Holy during his long secret conversation with Helms in summer 1969, after Ehrlichman pressed to see that CIA “mystery document, ” the Inspector General’s Report. So when Haldeman, at Nixon’s behest, had told Helms, “It’s likely to blow the whole Bay of Pigs, ” he had really been—he came to believe—“reminding Helms, not so gently, of the cover-up of CIA assassination attempts on the hero of the Bay of Pigs, Fidel Castro—a CIA operation that may have triggered the Kennedy tragedy and which Helms desperately wanted to hide.” 

RICHARD HELMS MADE no mention of the Kennedy assassination as he stood talking with his deputy downstairs, on June 23, by their car on West Executive Avenue. Instead, he shared with Walters his puzzlement about the White House’s concerns. The references to Mexico were quite unclear to him, but he had been dealing with the White House for a long time, and sometimes a president, or a Haldeman, somebody in high authority, had information Helms did not. It would have been presumptuous to press any harder as to how they had come up with this strategy, or who was behind it. After all, here were Haldeman and Ehrlichman, the two most senior officials in the White House next to the president himself, and Helms had to assume they had the proper authority. That had to be the working assumption of anyone competing for the president’s personal attention, really needing and rarely getting it. 

But why, Helms wondered aloud, had Walters been chosen to go see Gray? Perhaps, Walters suggested, Haldeman thought that he was a good bet because he was military; a lot of people had the mistaken belief that military types obeyed blindly, because they were used to taking orders. Or maybe Haldeman had heard reports of past friction between the FBI and the CIA, between Hoover and Helms, and wanted a fresh relationship to grow between Walters and the new FBI director.

Helms frowned, but the notion of Gray’s newness to the job did suggest to him a way of framing Walters’ request: as a perfectly legitimate CIA reminder to a rookie bureaucrat. “I think you should put this to Acting Director Gray, since he is a new Acting Director of the FBI, within these legitimate limits: That there is a longstanding delimitation agreement that if the FBI runs into CIA operations, or CIA runs into FBI operations, one side notifies the other.” 

Walters nodded. Helms, still frowning, got into the car and drove back to Langley. 

PROMPTLY AT TWO-THIRTY that afternoon, Walters called on Gray and saw him alone. It was the first time any CIA official had been inside the FBI director’s office since Helms had visited Hoover in June 1966. They expressed pleasure at meeting one another; Walters had intended to call on Gray, and so forth. After a few minutes of such pleasantries, Walters casually said that he had just talked to some senior staff member at the White House. He mentioned no names, and Gray asked for none. Those unnamed White House persons wanted Gray to be told that the FBI investigation into the Mexican money chain might uncover covert CIA assets or sources. Though the investigation had not touched any current Agency projects, its continuation “south of the border” could “trespass upon some of our covert projects and, in view of the fact that the five men involved were under arrest, it would be best to taper off the matter there.” 

Gray understood that statement to mean that CIA had an interest in Kenneth Dahlberg, who had bankrolled the burglars. But that clearly contradicted what Helms had twice told him—that there was no CIA involvement. The contradiction was a little strange, but not necessarily sinister. There was so much compartmentation in the Agency, Gray figured, that the left hand didn’t always know what the right was doing. 

Walters next relayed what Helms had said about the FBI-CIA agreement not to expose each other’s sources, and added, incorrectly, that the Bureau had always “scrupulously” respected it. Gray had not read that agreement, and had not even heard of it, but it seemed logical. He didn’t yet know exactly how the FBI would proceed, but understood what Walters was trying to say. His problem was how to “low key” the investigation now that it was launched. A large sum of money had been floating around; there was the matter of a check on a Mexican bank for $89,000, and some $81,000 that had been sent to Mexico, for purposes unknown. 

“A most awkward matter to come up during an election year, ” Gray said ominously as they wound up the session. 

Walters returned to his office at CIA and made a report of the meeting to Helms, then talked to the Western Hemisphere desk. Nobody felt that the ongoing FBI investigation could jeopardize any Agency activities. 

Walters wondered why the White House wanted him to lie. 

HOOVER’S CRITICS COULD SAY what they wanted—and they dared to say a lot more about him once he was dead —but no one ever doubted that he would have refused to let CIA, or the White House, tell the Bureau how to conduct a criminal investigation. The Watergate cover-up, even his most severe detractors would admit, could not have happened on Hoover’s watch. 

But L. Patrick Gray was no J. Edgar Hoover. After meeting Walters on June 23, Gray telephoned Dean, assuring him that the FBI would hold up its interviews temporarily and “work around this problem.” Dean seemed satisfied. Gray then informed Assistant Director Charles Bates that the FBI might have uncovered “a CIA money chain, ” but must abide by the CIA-FBI agreement relating to exposure of Agency operations. Bates, who had been liaison to CIA for three months between Papich and DeLoach, believed that Gray was being perhaps a bit too willing to call off the dogs; he urged: “Under no circumstances should the FBI back off an investigation at the request of CIA without forcing them to reveal completely their interest in the matter.” But Gray ordered that the Bureau refrain from interviewing Dahlberg, as well as Manuel Ogarrio, a Mexico City lawyer whose checks, like Kenneth Dahlberg’s, had found their way into the CREEP account accessed by Barker. Bates‘ anger only built as, at Helms’ request, Gray also directed that the FBI not interview CIA men Karl Wagner and John Caswell, whose names had been found in a little telephone-address notebook belonging to Hunt. By the first week of July, Bates and other FBI agents were on the verge of rebellion, especially over their inability to follow the Mexican money trail by interrogating Ogarrio and Dahlberg. On July 5, Gray finally called up Walters and put the heat on. 

“We have done everything we can do to trace the money except interview those two men, ” Gray complained. “Either you have got an interest in Ogarrio and Dahlberg or you haven’t, and if you have I need it in writing or I am going to go ahead and interview those people.” The next morning, Walters delivered a document indicating that CIA had no interest in either man, no matter what the White House said. Walters didn’t care if he had to resign; he would not write any letter saying that the FBI’s investigation was endangering CIA operations in Mexico. He did not see why he or Gray should jeopardize the integrity of their agencies to protect some White House figures who had acted imprudently. General Walters then told Gray he had to be quite frank with him, and described the White House meeting in which Haldeman had ordered him to warn Gray off. Leaning back in the red overstuffed leather chair in which he was sitting and putting his hands behind his head, he said that he had come into an inheritance, was not concerned about his pension, and wasn’t going to let “these kids” kick him around anymore. Someone should tell the president that certain White House aides were encouraging CIA to deceive the FBI—a course of action which, if made public, could be “electorally mortal.” 

Gray said firmly, “You should call the president, you know him better than I.” 

Walters said, “No, I think you should, because these are persons that FBI wishes to interview.” 

They did not settle on who, if anyone, would make such a call, but, after Walters departed, Gray ordered the immediate interviews of Ogarrio and Dahlberg. Then he sat at his desk quietly and pondered Walters’ revelations. He was unsettled enough to believe that Nixon should know what was going on, but it was a pretty awesome thing to call the president of the United States. He decided to relay the message through one of the president’s advisers, Clark MacGregor, who was close to Nixon and had his confidence. 

About a half-hour later, at 11:28 a.m., the president telephoned Gray, who was somewhat surprised that his call was returned so quickly. Nixon congratulated him for the FBI’s successful termination of a hijacking the previous day in San Francisco. Gray thanked him, then said awkwardly: “Mr. President, there is something that I want to speak to you about. Walters and I feel that people on your staff are trying to mortally wound you by confusing the question of CIA interest in, or not in, people the FBI wishes to interview.” 

He expected Nixon to ask which staff members were meant, but he did not. There was a slight pause. The president said, “Pat, you just continue to conduct your thorough and aggressive investigation.” 

Gray warned that the case could not be covered up. He and General Walters felt that Nixon should “get rid of the people” who were trying to do so. 

Nixon asked, “No matter how high?” Yes, 

Gray replied, that was his recommendation. 

FOR THE MOMENT, President Nixon decided not to get rid of himself, or Haldeman, or Ehrlichman, or Dean. Instead, he responded to Gray’s advice by axing the chief obstacle to the cover-up—Richard Helms—whose refusal to let CIA take the hit for Watergate was opening the way for an FBI investigation that would lead into the Oval Office. By summer’s end, the Bureau successfully followed the Ogarrio-Dahlberg money trail away from CIA to CREEP, while a similar deflection of suspicions from the Agency, toward the president’s men, was accomplished by Deep Throat’s continued reporting to Woodward. Nothing was uncovered to keep Nixon from defeating George McGovern, but the die had been cast, for Helms as for Nixon. “By refusing to participate in the Watergate cover-up, ” Cord Meyer ventured, “Helms preserved the institutional integrity of the CIA, but he also ensured the end of his career as director.” 

Nixon decided to replace Helms with James Schlesinger, a relatively unknown forty-eight-year-old economist in the Bureau of the Budget. A politicized intellectual with white hair and the habit of taking off his eyeglasses and chewing absently on one end piece, Schlesinger had recently made what old-school CIA analysts like Ray Cline regarded as “a very sensible study of Central Intelligence.” Informed of the president’s decision even before Helms, Schlesinger suggested that Helms’ sixtieth birthday, the following spring, would be a more appropriate time to make the switch, since Helms’ own policy required automatic retirement at that age. But on November 20, Nixon called Helms in and asked him to become ambassador to Iran, effective the following February. Not feeling quite ready to quit government, but more than happy to escape Washington, Helms accepted the post. 

Before leaving, Helms briefed Schlesinger on operational matters, and liaison relationships, especially with the FBI. The Bureau was getting set to send over a regular liaison officer again, to supplant ad-hoc contacts that had been occurring surreptitiously in Hoover’s last two years, and openly and with great frequency in the months since his death. After they had successfully resisted the White House cover-up scheme, a sense of secret alliance and shared integrity bound CIA officers like Helms, Walters, and Colby to FBI men like Gray and Bates. Nor was the Bureau objecting anymore to the DCI’s wearing of his second hat, as leader of the intelligence community as a whole, and there was now a golden opportunity for the new director to expand into that role by a more activist chairing of interagency boards, and the assumption of more control over the preparation of national estimates. By the end of his tenure Helms regarded the traditional FBI-CIA problem as “absolutely no problem at all.” That was surely an overstatement, but it was emblematic of the new feeling that Helms was given a farewell lunch by the acting director of the FBI, which was, Helms thought, “simply new in history.” He only hoped his old Agency itself would withstand the storm of controversy he sensed was about to break. 

THE FIRST CRACKS of thunder came three weeks after Helms flew to Iran, during Gray’s long-postponed confirmation hearings. The Senate Judiciary Committee had previously been busy with antitrust hearings against ITT, Gray had been out for most of November, convalescing from abdominal surgery, and Nixon had wanted to evaluate Gray’s performance. But in late February 1973, Nixon finally had sent Gray’s name to Capitol Hill. That was a strange decision indeed, inasmuch as Gray was certain to be grilled about the FBI’s Watergate work. Ehrlichman and others had therefore strongly opposed Gray’s nomination, but Nixon had gone ahead—perhaps because Gray had been a Nixon loyalist since 1960, and had only been trying to look out for the president by ratting on Dean and Ehrlichman in July; perhaps because Nixon feared Gray might expose the Watergate cover-up if unceremoniously dismissed for his loyal service. In any case, the hearings were a total disaster. 

They began on February 28, with Gray insisting that the FBI had conducted “a full-court press” on Watergate. He then volunteered, without being asked, that he had routinely furnished Watergate investigation summaries to the White House. That unleashed angry badgering from senators such as Robert C. Byrd of West Virginia, who believed that Gray had been, wittingly or not, abetting a White House cover-up. To appease them, Gray said they could review all the FBI Watergate files they wished, but in that he was promptly overruled by the White House. By early April, senators had so many questions about how Gray had conducted himself as acting director, and whether his Watergate investigation had been independent of the White House, that his prospects seemed weak. Gray himself was meanwhile beginning to have some questions about the president he had been trying to serve, and he withdrew his name from nomination. “In the service of my country, I withstood hours and hours of depth charging, shelling, bombing, ” Gray later reflected, “but I never expected to run into a Watergate in the service of the President of the United States, and I ran into a buzzsaw, obviously.” 

Gray was succeeded by William Ruckelshaus, former head of the Environmental Protection Agency. On his desk when he arrived was a telegram protesting his appointment, bearing the names of all Bureau SACs. No one could figure out why he was made director, and neither could he. 

“When Gray got in trouble, and Ruckelshaus came in —I think that was probably the worst time in the Bureau, ” special agent Jay Aldhizer re-called. “You had a director who was compromised by White House aides.” With the selection of Ruckelshaus, who didn’t really know what to do, the debacle was complete; all the old pride was almost gone. 

Morale was plunging at CIA, too. Schlesinger had “arrived at Langley running, ” as William Colby would later say, “his shirt-tails flying, determined, with that bulldog, abrasive temperament of his, to set off a wave of change.” By late 1973, he had fired over 7 percent of the Agency’s officers, mostly from the clandestine side. There was a general sense that Schlesinger was “Nixon’s revenge” against the Agency for not cooperating in the cover-up of Watergate. 

But already the Watergate scandal had passed the point where the FBI or CIA could do anything to contain it, even if Schlesinger and Ruckelshaus, each selected at least partially for anticipated political subservience, had been willing to comply. Nixon’s attempt to play CIA against FBI, described in August 1973 by Gray, and also alleged by Dean, initially lacked any firm public proof. But such proof existed in the secret White House taping system, which Watergate prosecutors had learned about from former staffers scrambling for leniency. When the president refused to release any of the tapes, his public approval rating sank like an anvil, 37 points in the seven months ending August 14, according to one Gallup poll; his 31-percent rating was the lowest of any president in twenty years. At Disney World, on November 17, he insisted, “I am not a crook, ” but he was not believed. Even so, Nixon might have run out his term had not the Supreme Court ruled, on May 31, 1974, that he had to turn over his White House recordings to a Watergate special prosecutor. Among the sixty-four tapes ordered released was one revealing that on June 23, 1972, Nixon had ordered Haldeman to use CIA to obstruct FBI inquiries. When finally released, on August 5, 1974, that tape provided irrefutable proof that Nixon had conspired in a cover-up, and thus immediately became known as the “smoking gun.” 

It “mortally wounded” the president, just as Walters had predicted. Nixon’s attempt to exploit the wedge between foreign and domestic counterintelligence became article I of the Articles of Impeachment drawn up against him. His earlier attempt to close that same FBI-CIA wedge, by relaxing legal restraints on CI coverage under the Huston-Sullivan Plan, constituted article II. The looming certainty of a Senate vote on these two articles led directly to President Nixon’s preemptive resignation on August 9, 1974. 

It is one of the neglected significances of history that both articles of impeachment were rooted in the secret war between CIA and FBI. Nixon’s personality may have driven the events that culminated in Watergate, but their form was dictated by the uniquely bicameral context of counterintelligence. If there had been no break in liaison, no disputes on domestic CI coverage, no need for the Huston Plan, no cause for creation of the Plumbers, no forty-year feud to inspire a cover-up scheme, and no separate left hand of American CI to restrain the right, Watergate probably would never have happened at all. 

Nor, for that matter, would there have ensued the post Watergate chain of cause and effect—leadership changes, and investigations into CIA and FBI work—which would radically alter the nature of recently restored liaison, create new twilight-zone problems, and ultimately lead— as Cord Meyer put it, “like a string of exploding Chinese firecrackers”—to the devastation of American counterintelligence.

CHAPTER SIXTEEN 

BLOWBACK 

TRASH SWIRLED THROUGH the great Langley parking lot on May 11, 1973, as William Egan Colby locked up his car and began the long walk toward CIA headquarters. Unremarkable-looking, of average height, middle-aged, with mild eyes blinking behind glasses, he looked like any suburban commuter anywhere in the world. He had almost nothing in common with James Bond; therefore, Colby was exactly what the Agency wanted its officers to look like in real life. Though he had been made director of CIA only the day before, he had deliberately parked up against the fence on the far side of West Parking, instead of in the director’s garage, and now he was striding the equivalent distance of the enormous Pentagon parking lot. He was doing this to make a point: among other changes, CIA had to become “more democratic.” 

Colby was an ACLU member and a onetime union organizer who had joined CIA as the best route for a non communist liberal to do good. After serving as CIA’s Far East Division chief from 1962 to 1967, and then as the architect of Operation Phoenix, a rural “pacification” program in Vietnam, he had returned to Washington in 1970 and absorbed certain themes floated by the campus movement of the sixties: self-determination by the young, equal opportunity, ethnic diversity. He instituted parking spaces for the handicapped and a program of minority hiring, and would go down to the regular employee dining room for lunch and invite junior officers to eat with him. That impressed most young people, who came to regard Colby as the epitome of egalitarianism, but it depressed senior officers, who eventually came to ŕegard Colby as CIA’s answer to California’s perk-abhorring governor, Jerry “Moonbeam” Brown. To veteran clandestine operators, who already feared Colby as Schlesinger’s hatchet man, the symbolic rejection of senior-officer privileges was but one more drag on morale. “It all changed under Colby, ” one CIA official recalled. “There was graffiti on the walls in the bathrooms, a different outlook toward pride in the organization, and a general decline of discipline.” 

But Colby was going to remake CIA whether it made him popular or not. During the two years of down-time between the Watergate burglars’ arrest and Nixon’s resignation, he changed the face of CIA counterintelligence, and with it the nature of CIA-FBI liaison. After Nixon’s departure, by going public with Chaos and other CIA “Family Jewels, ” Colby would spur what was later viewed as an over corrective “regulation” of intelligence. Yet official inquiry into the Colby-era revelations would also offer a forum for examination of interagency disputes, and several government bodies would recommend remedies for FBI-CIA conflict. James Angleton, and others who felt themselves victimized by the Colby changes, could only hope that such scrutiny would resolve some old turf problems. Then again, perhaps that was asking too much. 

IN HIS DETERMINATION to transform the Agency, Colby shared a sense of mission with the FBI’s new director, who arrived shortly after Colby took over at Langley. Clarence Kelley had become acting FBI director on July 7, 1973, when the hapless Ruckelshaus’ unpopularity forced Nixon to appoint someone who would be respected. Kansas City Police Chief Kelley, a special agent himself for over twenty years, was a husky, blunt featured man—Babe Ruth with bifocals, some said. He had once been an FBI firearms instructor, and was generally considered “a man’s kind of guy, as opposed to the shoe clerks who ran the Bureau.” Yet his simple, police-chief exterior hid a sharpness of insight, and a tendency to think long-term. He was willing to try new, decidedly anti-Hooverian techniques to improve the Bureau’s performance, and to patch up relations with CIA.

Shortly after Kelley took over, Colby dialed him up with a formal offer of peace. “Look, I don’t care what hell the past was all about, ” Colby said. “Let’s communicate. Why don’t you bring all your senior officers out to the Agency, and we’ll give you lunch.” Kelley came over with his top deputies, and there was what Colby considered “a good, long session. I put the word out, you know—’We will cooperate.’ It was something I felt needed to be done.” 

The next few months saw a flurry of pro-forma concessions by each side. On August 29, Colby essentially ceded primacy to the FBI in covering Americans abroad, and restricted Operation Chaos to a passive collection of information upon FBI request. In November, Kelley killed the FBI’s Scope campaign, which had been targeting Israeli scientists in the U.S. since 1968, much to the Agency’s displeasure. At the same time, Kelley reinstated the formal position of liaison officer with CIA. 

Although interagency meetings had been held openly, and much more frequently, after Hoover’s death, liaison during the early Watergate era had been conducted mostly at the top levels, on an ad hoc basis, by Walters, Angleton, and Colby. Gray had been warned, by anti-CIA deputies such as Felt, against appointing “another Papich, ” who would only come under CIA domination and perhaps steer the FBI away from real Agency involvement in Watergate. Helms, meanwhile, had not wanted any FBI people roaming the halls at Langley, where they might pick up loose hypotheses about Hunt or McCord, until it was clear that the Bureau was not going to unfairly pin Watergate on the Agency. Hence, despite the dire significance once attached to Hoover’s scrapping of the liaison-officer position, no new Papich had materialized during the Pat Gray period. 

But by November 1972, Papich onetime assistant William Cregar had not only taken the lead in managing the daily mail flow to CIA, but was coordinating Soviet CI with Angleton’s shop. During the RuckelshausSchlesinger interlude, Cregar had become the FBI’s defacto liaison officer, and when Kelley came in, Cregar was officially given the job. Like Papich, Cregar had been a college and pro-football star—first as an AU-American guard at Holy Cross, and then for the Pittsburgh Steelers —before joining the FBI in the early 1950s. His athletic career and big-jock approach to life were often remarked on, not only by spooks at the Agency, but even by his colleagues at the FBI. “Bill really was the football-player archetype, ” one of his colleagues would later say. “I mean, imagine John Madden running around after Soviet spies instead of coaching the Oakland Raiders—that was Bill Cregar. He was just that way—absolutely outrageous to interact with. He was built like a bull—and would act like a bull, at times. Always a very up-front man. He never was subtle, or too introspective.” Recalled Jay Aldhizer, who worked under him: “Cregar had a high profile in the intelligence community. Definitely a flamboyant personality, with a desk-pounding, get what I want type of relationship with CIA.” 

Cregar might easily have been shunned by the Agency as just another gun-toting Bureau bigfoot, if not for one salient fact: he knew CI. In the late 1960s, he had started coming to interagency meetings more or less as Papich’s deputy and detail man; he had kept minutes for the working meetings at Langley during summer 1970, when Sullivan was pushing the “Huston Plan, ” and had been a strong backer of that project. “Hoover put us out of business in 1966 and 1967 when he placed sharp restrictions on intelligence collection, ” Cregar would later say. “I was a Soviet specialist and I wanted better coverage of the Soviets. I felt that we needed technical coverage on every Soviet in the country. I didn’t give a damn about the Black Panthers myself, but I did about the Russians. I saw these meetings as a perfect opportunity to get back the methods we needed.” His pro-Agency stance at the Huston-Sullivan meetings had endeared Cregar to Angleton and others at CIA, and he met secretly with CI officers many times after the Huston-Sullivan Plan collapsed. “Cregar liked CIA, and they liked him; they trusted Cregar, and he trusted them, ” Aldhizer would say, expressing the general view. “If a matter of CIA interest ever worked its way up to him, the Agency got a good hearing. So he had developed a lot of his own contacts, and could pick up the phone, call somebody at the Agency if he had a problem, and they’d get right to it. He was in daily communication with them—and I think, operationally, he got very involved.” 

So involved, apparently, that the whole nature of the liaison position had to be changed. There was so much business with CIA—in new areas like terrorism and drug smuggling, as well as in more traditional spheres like security checks, the travel of diplomats, and the search for penetrations—that one man could no longer manage it all. Papich couldn’t, by the end of his tenure, which was why he had brought in Cregar, but the problem had moved even beyond that level, and Cregar had to split up the duties among various people at the FBI. Junior agents like Fred J. Cassidy handled routine correspondence and liaison, and sat in on meetings with specific divisions at CIA, freeing up Cregar, who still oversaw the whole, to work important joint operations. The result was a degree of cooperation that not even Papich, hampered by the jealousies of Hoover, had been able to attain. “Under Bill Cregar, we had a number of cases we ran together, or shared information on—black areas I still can’t talk about —where I didn’t see any essential distinction between the two out-fits, ” James Nolan attested. “We were working as one team.” 

Cregar also achieved the long-sought Papich goal of agent exchange, or at least what amounted to a “student exchange” program. Beginning in late 1972, seven CIA officers began participating in Bureau training programs at Quantico, Virginia, and a few G-men enrolled in ultrasecret sessions at Langley. Among the latter was Larry McWilliams, who was among the first select group to attend a two-week mid-level CIA course. “CIA officers in that class were just fascinated by us, like we’d just stepped off a flying saucer, ” Mac remembered. Sometimes when a question was asked, a CIA officer would sort of turn around in his seat and jokingly say, “Maybe one of these cops can answer it, ” and after the laughter died, an FBI man usually would. FBI agents likewise warmed to guest lecturers from the Agency. An old hand from Angleton’s shop might be in from 3:00 to 6:00 p.m., though only halfway through his lecture by 6:00, and the FBI students would say, “Hey, can we sit around? You want to go to dinner, have a beer?” FBI overseers were initially hesitant about such unchaperoned contacts, but soon relaxed their vigilance. As Mac put it, “We knew, if we couldn’t trust these students by now, and if we couldn’t trust CIA not to screw us, we were failures.” 

As a result of such cross-pollination, young FBI agents became well versed in Angletonian counterintelligence, and disinformation became an established topic in the Bureau’s basic CI course. Mac and others still disagreed with Angleton over the bona fides of Nosenko, Fedora, and Top Hat, and there was still no embrace of the difficult Golitsyn, but deception theories were at least “in play.” FBI counterspy work was generally deprovincialize, as G-men working Czech or other “Satellite” accounts would be given the opportunity to handle Soviet cases, to see the bigger picture. There was an improved compartmentation of secrets, and a tightening of access to classified documents within the Bureau. The net effect was that FBI counterintelligence became more like CIA, as McWilliams had hoped would happen: “This big difference in philosophy was what we were trying, through these schools, to break down.” 

To break down that philosophical barrier was also the goal of William Colby, who was meanwhile remaking CIA counterintelligence along the lines of the FBI. The irony of that parallel push for change was a dramatic “switch” of great historical importance: while the FBI adopted much of CIA’s Anglo-Angletonian contextualism, CIA counterintelligence adopted the FBI’s old anti-intellectual approach. Perhaps they passed in the night, but never were the twain to meet. 

HOOVER HAD SEEMED “a gruff old man” when Colby was invited to the FBI in early 1973 for a ritual handshake, but Colby harbored, as he later said, “the highest respect for the first-class, professional, outfit Hoover had built, ” and especially admired the “discipline and professionalism” of FBI personnel. CIA needed a little more of that, Colby thought. Most of all, the Agency needed to stick to practical reality, something the FBI had never had a problem doing. Colby felt that CIA counterintelligence had become altogether too dependent on the theses of Anatoliy Golitsyn, and that an inordinate fear of disinformation agents and moles had paralyzed CIA’s collection efforts, especially in the communist world. He grasped also that Angleton’s belief in a long range Soviet plan complicated full Agency support for the policy of detente, which, as Henry Kissinger would say, began by rejecting the notion that Soviet strategy necessarily followed a long-range plan. At a time when Nixon and Kissinger had been opening up to China, Angleton had even arranged a meeting—derisively dubbed the “Flat Earth Conference” by some attendees— at which Golitsyn argued that the Sino-Soviet split was a disinformation stunt. Colby didn’t want to fire Angleton, preferring to ease him put, but he was going to remake CI operations on the FBI model, whether Angleton remained as CI chief or no. 

“I just thought CI should be an inherent part of the intelligence process, ” Colby later explained. “Do your counterintelligence as an aspect of your positive intelligence. Make it part of a case officer’s professional background.” In practice, that would mean that every case officer would have the task of establishing the bona fides of his own recruitments. Angleton’s CI Staff would no longer have an automatic role in agent assessment, and would be largely cut out of the process. No one doubted that this would cause agent-handlers to take their sources’ information at face value, and to downplay the possibility of provocation—just as the FBI, until recently, had always tended to do. The rationale was evident in a cable that went out, under Colby’s direction, to CIA chiefs of station throughout the world, setting out a new policy in the handling of “walk-ins, ” as unsolicited agents were known. “Analysis of REDTOP [communist] walk-ins in recent years clearly indicates that redtop services have not been using sophisticated and serious walk-ins as a provocation technique. However, fear of provocation has been more responsible for bad handling of walk-ins than any other cause. We have concluded that we do ourselves a real disservice if we shy away from promising cases because of fear of provocation. We are willing to run any apparently useful case for a reasonable period and can do so in such a way that little or no harm will be done if the case should turn out to be controlled.” 

Miler was incredulous. “To me, Colby’s idea that every case officer could be his own CI officer was a bunch of crap. How could one man possibly know enough about foreign intelligence services to do a good job? If an agent came to you with the blueprints for, say, an Iraqi supergun, how were you going to know enough even to ask an intelligent question?” The notion of a multidextrous CI-FI officer seemed akin to the ideal socialist man in Marx and Engels’ Utopia, who would get up each morning and plow his field, and in the afternoon he’d write a symphony—no division of labor at all, everybody would know everything. Angleton and Miler felt Colby’s approach to CI was no more feasible than setting up the communists’ impossible dream. 

Even some of Angleton’s critics within the Agency wondered whether a field agent could really have enough background knowledge to make such assessments, but Colby had an answer to that objection. To ensure that each case officer would know all he needed to know in assessing a recruitment, Colby decided that CIA’s files, like the FBI’s, should be de-compartmentalized; Angleton would no longer control who got to see CI aspects of a case. Effective July 1, 1973, the CI Staff was “decentralized, ” and would serve only in an auxiliary or advisory capacity. Even most FBI liaison was stripped from Angleton and given to the DDP and Office of Security. 

As Colby would later allow, “Taking away FBI liaison was designed to lead [Angleton] to read the handwriting on the wall.” But the move had other effects, which Colby could not have foreseen. Under Colby’s decompartmentalization, liaison with the FBI in security cases could mean exposing Agency secrets to unnecessary risk. If the two agencies had wreaked much havoc on national security by not telling each other things, there had always been a healthy, positive aspect to that, a legitimate concern that the other organization might not be as secure, or might treat carelessly secrets that were not its own. By 1975, Colby would prove that it was possible to bungle not only by holding back, but by telling too much. 

THE CASE IN QUESTION had begun back in February 1968, when a Soviet Golf-class submarine was cruising 750 miles northwest of Hawaii, armed with nuclear-tipped SSN-5 missiles. A malfunction trapped hydrogen in the vent system, and a spark caused the flammable gas to explode. The ship’s hull plates were torn open, tons of water poured in, and she sank. By May, the Soviets had given up hope of ever finding her. But the computerized U.S. Sea Spider tracking system knew exactly where she lay, like a lost treasure ship, with a wealth of intelligence about Soviet military capabilities. So, by June 1968, CIA’s deputy director for science and technology, Carl Duckett, had proposed a mission to the bottom of the sea. 

“You must be crazy!” Helms had said. But Duckett convinced Helms that the mission could be accomplished if CIA tapped the technical genius of one of its longtime contractees, Howard Hughes. Under the code name “Jennifer, ” CIA and Hughes began building a mother-ship that would be longer than two football fields and as tall as a twenty-three-story building. The showpiece of the ship would be a “pipe string, ” lengths of thirty-foot pipe joinable into segments, which would descend three miles underwater to the wreck. Attached at the end of the pipe string would be a great mechanical claw. Since there was no way to hide construction of such a leviathan vessel, a cover story had to be conceived. CIA settled on an expedition to mine for minerals, ostensibly by a company called Glomar Research. The ship took five years to build, and Hughes himself died in the interim. But his successors delivered the Hughes Glomar Explorer on time and under budget ($70 million). On June 20, 1974, it left Long Beach Harbor on its secret mission. 

A few days later, as the Explorer was almost at the sub site, CIA’s Office of Security came to Colby with troubling news. On June 5, Hughes’ offices in Los Angeles had been burglarized. A memo describing the sub-recovery operation could not be found. The true nature of the expedition might be known to the Soviets, who might lodge a UN protest or board the ship in international waters. Colby decided to proceed until the full extent of Soviet knowledge was established; in the meantime, every effort would be made to recover the stolen paper. Since CIA had no authority to conduct domestic operations, Colby contacted Kelley and explained the dire implications. Kelley promised that the Bureau would conduct a “full-court press.” 

On July 5, when the Explorer reached the recovery area, Soviet “fishing trawlers” also showed up at the scene. They made no attempts to board, however, and Hughes had specially designed the ship to reveal little to ignorant observers. Secret underwater gates slid back, the pipe string descended, the claw grappled the submarine. But in securing the hull, the giant steel fingers were bent, and the sub came loose; half was broken off during raising. Because of seasonal swells, further attempts would have to wait until the next “weather window, ” in July 1975. Even as the Explorer headed home, planning for this second operation, to be known as Project Matador, was under way at Langley. All the hardware existed, and next time they’ d get it all—if only security could be maintained a little longer. 

The Bureau kept after the Hughes memo. By Christmas 1974, the search had turned up nothing. An elaborate scheme was concocted to trap the burglars, and $ 1 million in secret federal contingency funds was authorized to finance the plan. But some at CIA worried that the size and openness of the FBI’s “full-court press” might blow the Jennifer secret in the act of trying to protect it. In fact, that was what happened. 

Though the FBI had generally increased its compartmentation of classified data, it had not devised a way to keep its director from being careless with CIA secrets. In an attempt to gain local cooperation in the memo search, Kelley had confidentially advised Los Angeles Police Chief Ed Davis of the Jennifer Project. Someone from Davis’ office then leaked to the Los Angeles Times, which ran the story on February 7, 1975, with a front-page banner headline: “U.S. REPORTED AFTER SOVIET SUB.” 

So ended the treasure hunt. Because FBI indiscretion had exposed the first operation, another CIA trip to the sub site would be detected before the ship left its moorings, and Colby was not about to risk an international flap at the height of detente. The ship was sold to Lockheed. The Hughes burglary was never solved, the missing memo never found. Some of the blame was the LAPD’s, of course, but that compromise could not have occurred if Colby himself hadn’t told the FBI more than they needed to know. It was one more operation that had gone bad at the seam between law enforcement and intelligence—costing, in this case, $70 million, five years’ labor, and a trove of secrets. 

COLBY HAD APPEARED to colleagues to be in a state of increasing agitation during 1974, and not because of the sub-recovery project alone. The same pro-detente viewpoint which made him fear Soviet protest over the Explorer mission also imposed upon him a mounting desire to be rid of James Angleton. Despite being stripped of many powers, Angleton still used his position as CI chief as a sort of bully pulpit to inveigh against U.S.- Soviet rapprochement. Since decentralization had not caused Angleton to take the hint, Colby called him into his office on December 17 and suggested that he retire. Angleton refused. Colby now sought a pretext for forcing his outright removal, and found it in the jurisdictional twilight zone where Angleton had cooperated most closely with the FBI. 

The next day, Colby spoke by telephone with journalist Seymour Hersh and invited him to a meeting in his office at Langley. When they met, on December 20, Colby told Hersh about CIA’s Chaos and mail-opening operations, placing the blame for them on the CI Staff. In fact, Angleton had neither created nor overseen either program directly. He had, however, lobbied to continue both projects when Colby wanted to kill them, arguing that the FBI depended greatly on such “product” (even if, in the case of Chaos, the FBI had no “need to know” how CIA obtained the information). In any case, there could be no question that Angleton had done things of dubious legality, and Hersh was given proof of that. After briefing Hersh, Colby summoned Angleton and informed him that The New York Times would be exposing the operations, and linking them to Angleton, who now had no choice but to resign. His top deputies, Miler and Rocca, would also have to go. 

His old FBI friend Donald Moore was in the corridor as the CI chief shuffled out of Colby’s office. Angleton’s posture was more bent than ever, his face dark and defeated. Behind his horn-rimmed glasses, the usually sharp eyes were blurred with pain. 

Moore took him by the arm. “Jesus, Jim, it can’t be that bad, ” Moore said. “What’s the matter?” 

“It’s horrible, ” Angleton rasped. “It’s awful. You’ll soon read all about it.” 

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“OH, MY GOD! Oh, my God! They’re not supposed to have any counterintelligence in this country! We had an agreement with them that they weren’t to do anything unless they checked with us, ” Hersh quoted a former senior FBI official, probably William Sullivan, as saying. “They double-crossed me all along.” Toward the end of the article, which The New York Times ran on its front page December 22, Hersh briefly considered the proposition advanced by some Angleton defenders—viz., “that the laws were fuzzy in connection with the so-called ‘gray’ area of CIA-FBI operations”—but Colby was given the last word: “I really see less of a gray area in that regard. I believe that there is really no authority … that can be used for [domestic operations].” 

The American public was as shocked as Hersh’s “senior FBI” official professed to be, and as unforgiving as Colby. Hersh’s article was followed by revelations of other CIA “Family Jewels, ” such as mind-control experiments and the Castro-assassination plots, prompting Senator Frank Church to characterize that Agency as “a rogue elephant rampaging out of control.” Novelists like Robert Ludlum soon depicted the U.S. government as hatching conspiracies far more diabolical than any Angleton had ever attributed to the Soviets—a development not appreciated by Ludlum’s college roommate, who had become one of Colby’s top troubleshooters, and who “got tired of getting up in the morning to face the same old accusations about ‘dirty work, ’ even from my wife and children.” 

Morale at CIA sank to an all-time low, and stayed there for five years. It wasn’t that officials weren’t prepared for “blowback, ” the trade term for negative publicity or unintended repercussions from an operation. It was the scale and tone of the reaction, and their own government’s role in it, that came as a shock. As various governmental inquiries assumed the aura of inquisition, CIA’s legal counsel reminded all employees of their rights under the Miranda decision. Officers like Dave Phillips considered that “a pretty meager reward for twenty-five of the best years I could muster working for my country, ” and it stung all the more because it came just when so much CIA had fought for seemed in vain. The domino theory of communist expansionism in the Third World, so long ridiculed as right-wing paranoia, seemed actually to have come to pass; Angola, South Yemen, South Vietnam, Laos, Cambodia, all went communist in the space of a few months. America herself seemed lost, and preoccupied with themes of decline. Inflation had made it a lean Christmas for many families, and the sense of foreboding was tapped into by disaster movies like The Towering Inferno, Airport 1975, and Earthquake, all of which were playing as the Hersh story broke. 

Debate about authority and blame for Chaos continued in the papers over the Christmas holidays, as it would in various public forums for the next five years. A Times editorial took the Hersh line that Chaos flowed from the “unchecked independent initiative” of Angleton’s CI Staff, but noted “the decision in 1970 of J. Edgar Hoover, late director of the Federal Bureau of Investigation, to cut off working relations with the CIA. Since the agency could no longer rely on the FBI, the body legally charged with internal security, it was pushed into its own domestic surveillance … Professional rivalries are endemic among secret services, but this particular feud, stretching back to the predecessor organization of CIA, has had deplorable implications for national security.” 

Early in the new year, a presidentially appointed Commission on CIA Activities Within the United States, headed by Vice-President Nelson Rockefeller, devoted a fair portion of its labors to the Agency-Bureau feud. Clarence Kelley assured the commission that there was no longer any problem, but Helms, called to testify, thought things could be improved, for starters, if the Bureau were given the “source-protection” duties which had been “an albatross” to directors of central intelligence since 1947. The commission did not list Helms’ suggestion among its recommendations to President Gerald Ford in June 1975, but did urge an improvement in FBI counterintelligence, which would, it was hoped, remove Langley’s need to meddle in gray areas. The Bureau should develop an analytical capability, and, to help that happen, CIA officers should continue lecturing at Quantico, despite the worry of William Colby that this might be illegal. “There is no impropriety in the CIA’s furnishing information concerning [counterintelligence] techniques and developments to the FBI, ” the commission found. “The statutory prohibition on internal security functions … was intended to promote coordination, not compartmentation of intelligence between governmental departments.” 

Of course, there were limits to what the Agency could do domestically. It could not tap phones, infiltrate dissident groups, “or otherwise engage in activities that would require a warrant if conducted by a law enforcement agency.” The only exception would be when there was “a clear danger to Agency installations, operations or personnel” and Bureau coverage was “inadequate.” That left open the question of who would decide whether FBI coverage was “adequate, ” and by what criteria. The commision did not think that this would be problematic, “provided that proper coordination with the FBI is accomplished.” To that end, Colby and Clarence Kelley should submit to the National Security Council “a detailed agreement setting forth the jurisdiction of each agency and providing for effective liaison with respect to all matters of mutual concern.” But the Rockefeller Commission’s words carried no legal force; they were only recommendations. Colby and Kelley insisted that the problems of the past would not recur in the future, and no new jurisdictional-liaison agreement materialized. 

More severe were the 1976 conclusions of a Senate Select Committee chaired by Frank Church. Senator Church was particularly galled that the agencies had withheld their deepest secrets not only from Congress, but from each other. “These agencies are fiefdoms!” he pronounced in disgust. “CIA does not want the FBI to know what particular things it may be up to and vice versa.” The committee proposed reconciliation of mindsets, clarification of jurisdictions, and establishment of an NSC-level mechanism to resolve defector and molehunt disputes, but in some areas could not see how to eliminate the twilight zone. Which agency, for instance, should be allowed to infiltrate a domestic radical group whose members traveled overseas? Since the committee felt that “CIA should not infiltrate groups within the United States for any purpose, ” this left only the FBI. But the FBI would lose its jurisdiction as soon as the infiltrating agent left the country. The most the committee could suggest was “setting restraints on the investigation of Americans by the FBI, and applying those restraints to the surveillance of Americans overseas, by any arm of the government.” Since CIA was not allowed to collect any information about Americans in the United States, this truly put overseas coverage of Americans in a no-man’s land. But it was the best the senators could do. 

President Ford did issue an executive order in February 1976, attempting to lay down some fresh chalk lines on the turf. The order declared that CIA “shall not engage in … physical surveillance against a United States person outside the United States, ” unless that person “is reasonably believed to be acting on behalf of a foreign power or engaging in … activities threatening the national security.” Otherwise, however, the sole measure taken to smooth liaison was creation of yet another panel of talking heads, in the long and luckless tradition that had begun with Franklin Roosevelt’s Interdepartmental Intelligence Committee in 1939. The new National Foreign Intelligence Board was to effect “coordination of national intelligence products” and the “maintenance of effective interface” between intelligence agencies. It was to be chaired by CIA’s director; two other CIA men would sit on it, and one each from the other agencies, including a representative of the FBI director. Its first task was to resolve acrimony over the joint Kittyhawk operation, which had just gone tragically bad. 

REACTIVATING IGOR KOCHNOV, a purported mole in the KGB, had been one of the first moves by Angleton’s successors in CIA counterintelligence. The new CI chief was nominally George Kalaris, an old Southeast Asia hand and friend of Colby’s who did not pretend to know CI, and was happy to let his assistant, Leonard McCoy, have the run of Angleton’s shop. McCoy did not have any real CI experience, either, but he had a great interest in Kochnov, alias Kittyhawk, who in 1966 had offered to serve as a U.S. mole in Soviet intelligence. A condition of that offer had been that the U.S. help him “recruit” Russian naval defector Nicholas Shadrin into “working” for the KGB. Kochnov had returned to Moscow after Shadrin began feeding doctored naval secrets to the Soviets, but, almost nine years later, he had not been heard from. In keeping with the main theme of Colby’s CIA—recruitment of agents—McCoy now determined to get in touch with Kochov. Although Angleton had concluded that the Soviet was a provocateur, McCoy had no such doubts. Hoping to lure him to a secret meeting, a CIA Soviet Division officer made a “brush” contact with Kochnov in the Moscow subways. A ShadrinKochnov meeting was arranged, in Vienna, as an excuse for the Soviet to leave the USSR. 

Kittyhawk was supposed to be a joint enterprise, and its reactivation had apparently been arranged with the FBI’s consent, or at least with its blessing, but there were strains between the Bureau’s CI Club and the new ‘CI Staff. After Colby decentralized CIA counterintelligence and stripped it of liaison, Cregar, who had a good rapport with Angleton, had largely ignored the change. In 1974, after Cregar was promoted to assistant director for foreign counterintelligence, liaison officer Frank Schwartz had also continued to see Angleton, and the CI Chief’s sudden firing had caused genuine alarm at the Bureau. It wasn’t that FBI men made Angleton out as any kind of saint. There was general sentiment that, much like Hoover, he had stayed in the same position too long. There was also some resentment against Angleton for hiding Chaos, and a lingering sense that he had been wrong about the bona fides of Nosenko and the value of Golitsyn. But men like McWilliams and Cregar would have much preferred Angleton to Leonard McCoy, who now adopted all the positions which the post-Hoover FBI had rejected: double-agent games were worthless, compartmentation was not so important, and disinformation agents did not exist. 

That ran directly counter to what the FBI’s James Nolan now argued, in a paper alleging that both Fedora and Top Hat were bogus. The great counterintelligence flip-flop was thus complete As far as the Agency’s new CI Staff was concerned, the FBI was paranoid. To the Bureau’s CI Club, it seemed CIA did not really have any counterintelligence anymore—especially since Angleton’s successors had actually burned 99 percent of his CI files. The disagreements became so bitter that Cregar had cut off almost all contact between the two units, and so personal that McWilliams would say, even years later, “McCoy is a horse’s ass, and I hope that’s going on the record.” 

Those were the two sides that were supposed to share the Kittyhawk game in November 1975, when McCoy arranged an FBI-CIA meeting on the case. If FBI agents needed any further reason to disapprove of McCoy, they were now stunned to learn that their good buddy Bruce Solie, of CIA’s Office of Security, had been cut out of the operation. Solie had always been Kittyhawk’s CIA handler, but now McCoy wanted to send a Soviet Division officer who had met Kittyhawk in the early 1960s in Karachi, Pakistan. Sending that officer was risky, because if the KGB identified him entering Vienna, looked up his postings, and found that he had been assigned to Karachi at the same time as Kochnov, who was now also coming to town, they might wonder whether the CIA man had come to Vienna to meet the Soviet. When FBI agent William Branigan objected along those lines, McCoy proposed, as a compromise, that Shadrin be handled by McCoy’s assistant, Cynthia Hausmann. The FBI was not told that Hausmann had been publicly identified as a CIA officer by rogue former agent Philip Agee. 

The FBI was also not told about Angleton’s longstanding doubts on Kittyhawk. Because he suspected Kochnov of being a provocateur, Angleton always held that Shadrin should not be allowed to meet him in “unfriendly” foreign environments like Vienna, where the KGB had built a substantial apparat. Although the CI Chief had not believed that the FBI had a clear “need to know” of his suspicions, the interagency planning meeting on Shadrin’s trip to Vienna would have been a good occasion for Angleton’s successors to cut the Bureau in. Barring any warning from McCoy, however, Shadrin’s FBI handlers continued to believe that the whole Kittyhawk operation was secure. With Shadrin in no apparent danger from the Soviets, the Bureau decided that it could afford not to surveil Shadrin’s contacts with the KGB in Vienna. 

Shadrin and his wife, Ewa, arrived in Vienna on December 18, 1975, ostensibly on their way to skiing in the Alps. Shadrin went to a meeting with two KGB officers, returned, and was debriefed by Hausmann in the bathroom of his suite at the Hotel Bristol. His wife had thought he seemed edgy before he went to a second meeting with the KGB, from which he failed to return. Ewa contacted Hausmann, who was not at an emergency number when Ewa first called it, and who seemed unconcerned until the next morning—by which time the local CIA station was in a panic. Not only had Shadrin apparently been kidnapped by the Soviets, but a KGB backed terrorist known as Carlos the Jackal had taken an entire meeting of OPEC ministers hostage in downtown Vienna, and Richard Welch, CIA station chief in Athens, had been gunned down by terrorists. The three moves came within a few hours of each other, and shared some common elements. Welch’s identity, like Hausmann’s, had been compromised by Agee. Carlos’ KGB case officer, Colonel Viktor Simenov, was also Agee’s handler. If not a wilderness of mirrors, this was at least a tangled spider-web, and Angleton would probably have seen the synchronicity of Welch’s death, Shadrin’s vanishing, and Carlos’ OPEC takeover as evidence of a coordinated effort. But Angleton was not chief of counterintelligence anymore. 

Ewa Shadrin returned to the United States without Nick, who was never seen again. A later Soviet defector said he had died from too much chloroform in a KGB sedan. Igor Kochnov was never heard from. Eventually both CIA and FBI judged him to have been a provocateur, as Angleton had contended. 

Blame for the Shadrin bungle was debated to no result by the new National Foreign Intelligence Board. The FBI made much of the fact that Hausmann had not been at the emergency number; that kind of disciplinary lapse would have never happened in the house that Hoover built. CIA blamed the Bureau for calling off surveillance on Shadrin. The Bureau countered that they would have surveilled him if they had known about Angleton’s doubts on Kochnov. CIA should have also explained that the Votivkirche, where Shadrin had agreed to meet the KGB, Was a perfect spot for safe, fixed-point surveillance, because it was overlooked by the U.S. consulate. The Bureau was relying on CIA’s judgment; Vienna was not exactly FBI turf. “What the hell, ” Branigan’s colleague Eugene Peterson recalled, “Vienna is a place on the Danube, and the guy wrote waltzes there. That’s about all we know about Vienna.” Branigan would later be incredulous that CIA had not explained the situation more fully. “All we ever knew was that we didn’t want anybody out there pussyfooting around, ” he said. “You had to be stupid not to look out that window … Anybody knows that.” 

Outside the FBI, however, the consensus was that Shadrin’s disappearance had been the fault of neither side, and both—a classic case of an operation’s falling into interagency cracks. “It was a case being run on sort of the boundary line between the FBI and the CIA, and it just didn’t get the attention it deserved, ” Shadrin’s friend General Sam Wilson, of Defense Intelligence, later said. Colby, though maintaining that the FBI’s guilt ran as deep as CIA’s, would also see a “system failure” of sorts. “Clearly it did fall into that chasm between us. By not raising the subject, that he shouldn’t go to this meeting without some kind of counter surveillance—that was our mistake. But the FBI were handling him, so it was sort of their operation, and I don’t think they told the station very much about it, enough to realize what might happen. The station knew they were going to make the meeting, but there was a drop of the ball there. In other words, if it could have been a CIA case, and the CIA station would have been in charge of it, they probably would have arranged a countersurveillance. But since it was an FBI case—you know, there’s a reluctance—probably the Bureau didn’t want to be bossed around too much, and our people didn’t want to try to focus on what was really FBI business.” 

THE SHADRIN DISASTER did little to shore up Colby’s career as DCI. Many within his own agency thought he was too forthcoming with Congress and the media, which in 1975 had teased out other CIA “Family Jewels.” President Ford sensed that if the publicly vilified CIA “was to have the substance as well as the image of a significant change, we had to appoint a new man to preside over it.” Colby was fired and replaced in January 1976 by George Bush, a Republican Party loyalist, who restored morale by freezing the Schlesinger-Colby firings of clandestine operatives. 

With Ford’s electoral defeat, Bush was succeeded in January 1977 by Admiral Stansfield Turner. The Agency found him a rough man to work for, and he would become probably the least popular DCI since William Raborn. Turner came in, as Pete Bagley observed, “very much from outside, ” but, unlike Bush, he was never welcomed into the club. The admiral always referred to his ward as “the CIA, ” instead of simply “CIA, ” as other directors had learned to do; it was a minor point that symbolized a major estrangement. If he had entered the service of his country a generation earlier, he might have contributed much to the establishment of the U.S. intelligence community, for he had a sharp mind and the willingness to entertain bold ideas. But CIA did not want those qualities from its director in the late 1970s. 

Turner did not help matters by his approach to the job. On the surface, his cerebral self-confidence could often be mistaken for pomposity. He had a deep conviction that his own ideas were right; deputies seldom felt they could influence his judgment. But most troubling was Turner’s decision to lay off eight hundred of the Agency’s most experienced foreign-intelligence officers. “When I came into the Agency, they had all these old funds sitting up there, who were good guys, in their day, ” Turner recalled,“but a fifty-nine-year-old spy is passé. You need maybe one or two to run the place, but you don’t need them sitting around. Cord Meyer, one of the great old hands of human intelligence, was a special assistant to my deputy when I got there. There was just nothing for him to do. They gave him a make-work job, because he didn’t want to retire. But spies have to retire a lot earlier than most people, because it’s a young person’s game. You don’t go running around the back alleys of Bucharest at sixty five.” 

The old hands, however, were not usually replaced by young ones. For the most part, they were replaced by machines. Turner had decided to shift CIA’s operational emphasis from human to “technical” collection—from case officers and spies to listening devices and satellites. That had its logic, especially since covert action had become such an embarrassment and a liability to CIA during the Church period. But it was understandably unpopular with the collectors and analysts of human intelligence, who had traditionally been the spine of the Agency. 

Sometimes Turner felt more welcomed by the FBI than by his own people. He himself professed great respect for the Bureau—“I never looked down my nose at any of the FBI people I dealt with; they were just as suave, just as smooth, just as educated as anyone; I had known a couple of FBI men personally, before I got into CIA. I was hardly installed as DCI when Clarence Kelley invited me and my wife to have dinner in the FBI building one evening with him and all of his top people and their wives. I think he made one or two other overtures, including having me come to lunch with him in the White House mess.” 

Operational interface was eroding, however, because of a recent change in liaison. Although impressed by Vernon Wannamer, who replaced Frank Schwartz as liaison officer, Turner seldom saw him. In 1975, partly to protest the McCoy regime at CIA, Cregar had bucked down the liaison position from “supergrade” in the civil service pay scale. Thereafter, few men stayed in position long enough to get the trust of both sides. Liaison officers lost their operational roles and became largely errand boys and social secretaries, setting up meetings and carrying mail. Wannamer and his successor, James Whalen, could do little to prevent disputes over such matters as the intractable “Chaos problem”—the surveillance of American citizens—which became a recurring irritant on Turner’s watch. 

“I would get frustrated because CIA would be listening to a telephone tap in Bolivia or Panama, and all of sudden a Latino with an American accent would get on the line, and by CIA’s own rules we had to drop that tap, ” Turner recalled. “These were CIA-imposed rules, they weren’t the law, but in the inquisitorial atmosphere of the Church Committee era, we didn’t want to take any chances. Looking back, we probably should have had some kind of arrangement to turn that material over to the FBI, so that they could have maintained the tap.” At the time, however, this idea had been rejected. By dragging the principals into court, the FBI might jeopardize the lives of agents CIA had placed inside narcotics rings (their cohorts were likely to be suspicious when they got off). “There was a case in Colombia in which that was something of a problem between us and the FBI. We said, ‘Sure, we helped you get this information, and track these people down, but we just can’t go to court with this.’” 

In other cases, CIA failed to track Americans overseas at all. In January 1977, two young Californians, Christopher Boyce and Daulton Lee, were arrested by Mexican police for selling the KGB code material from Project Pyramider, a communications system for U.S. Rhyolite surveillance satellites. (The case later became the basis for a book and movie, The Falcon and the Snowman.) Boyce, a clerk for the TRW Corporation in Redondo Beach, was caught when his courier, Lee, was spotted by Mexican police loitering around the Soviet Embassy in Mexico City. It developed that Lee had gone to the embassy previously, before any secrets were passed, but CIA had not picked that up. Cregar and others at the Bureau were aghast. Had the Agency become so timid, in the wake of recriminations over Chaos, that it didn’t cover American citizens at the Soviet Embassy in Mexico, as had been routine in Lee Harvey Oswald’s time? Ex-CIA men grumbled, “In the old days, we would have had coverage.” To Turner, though, matters were not so simple. If Lee’s role in passing CIA secrets was not yet known, did the 1976 executive order allow routine surveillance of Lee outside the Soviet Embassy? If CIA did cover Lee, could it relay this knowledge to the FBI? Or did it have to “sit” on the information, as it did when an American voice came on the line with Colombian drug dealers? 

When the case was discussed at a conference of current and former CI specialists, minutes of the meeting recorded that “A number of former senior intelligence officers [said] that the lead agency [CIA] should have coordinated its efforts with the FBI.” Others believed the episode represented an FBI failure to recognize that new weapons systems would logically be major Soviet intelligence targets; this guidance should have been provided the Bureau by CIA. A member of the House Intelligence Oversight Committee worried that the Boyce-Lee case showed “that no one is responsible, no one is really in charge and that this, in turn, does argue in favor of some new coordinating mechanism.” 

The need for a new mechanism was also shown by the unraveling of a case code-named “Magic Dragon.” In May 1977 a U.S. naval officer’s Vietnamese wife, Dung Krall, known by the cryptonym “Keyseat, ” was approached by Vietnamese intelligence and asked to serve as a courier. After reporting this overture to the FBI and CIA, Krall pretended to accept the Vietnamese offer, and began receiving batches of State Department documents from a man she identified as Vietnamese antiwar crusader David Truong, who was receiving them from a State Department employee, Ronald Humphrey. Truong and Humphrey were arrested by the FBI in January 1978, but the prosecutions would rest entirely on the willingness of Dung Krall to testify. That was where Magic Dragon fell apart. Kelley told Attorney General Griffin Bell that Mrs. Krall would be happy to appear in court, but an angry Turner insisted that Krall would not be available, since she still wanted to work for CIA overseas. Bell then dispatched his deputy, John Martin, to interview Krall, who was in London, in front of both CIA and FBI officials, to see if the contradiction could be resolved. Krall told the delegation she needed time to think about it, but afterward a CIA officer sneaked back into Krall’s apartment and persuaded her not to cooperate with the FBI. When the Bureau learned of that double-cross, it protested to Bell, who personally drove over to Langley, walked into Turner’s seventh-floor office, announced that the woman would testify, and ordered CIA to have “no more contact with Krall.” Turner acceded, but was bitter about Kelley’s apparent lack of concern for the safety of CIA sources. 

HUMPHREY AND TRUONG were convicted and sentenced to fifteen years each for espionage, but interagency disagreements in the Truong case had attracted President Jimmy Carter’s attention, and gave him the idea of replacing Republican-appointed Kelley with someone more likely to play on Turner’s team. In February 1978, Carter personally interviewed all the candidates, and the one he chose was William Hedgecock Webster. Webster was a Missourian, as was Kelley, but he came from cosmopolitan St. Louis, whereas Kelley was from more rustic Kansas City, and that symbolized the difference between the men. Both were lawyers, but Kelley had become an FBI agent and police chief, whereas Webster had been a District Court and federal appellate judge for five years before making Carter’s shortlist. Ultimately, Webster was chosen over other qualified men because he was a good friend of Turner, and thus offered the prospect of a detente between CIA and FBI. 

The future directors had met in 1941 at Amherst College, where Turner had gone before Annapolis, and where Webster belonged to an adjoining fraternity house. Both were Christian Scientists, and they had maintained contact over the years, while Webster was in law practice and Turner was coming up through the Navy. When Webster went to a bar-association meeting in Honolulu, Turner arranged for him to see captured Japanese footage of Pearl Harbor, and Webster got to ride on the admiral’s barge. Sometimes they still played early-morning tennis at Washington’s Naval Observatory—a fact which, for symbolism’s sake, they went out of their way to advertise after Webster became FBI director. Additionally, as Turner would recount, “About once every eight weeks we had lunch with a small number of people from both staffs to demonstrate our personal commitment to harmonious relations.” Webster felt that was the kind of signal needed, because “deep down in the system, most people wanted it to work.” FBI agent Jay Aldhizer would affirm that the Turner-Webster effect “filtered down, and it was hard for an assistant director or anyone else under Webster to not get along with the Agency.” 

But the two friends did have their share of shouting matches, though never in front of subordinates. In one instance, Turner recollected, “I signed something that made the FBI think we were trying to take over their duties for counterintelligence in this country. That was not what I intended the order to mean, but it was not good, on my part. Bill called me up and said, ‘I’m mad as hell at you!’ It was a good thing we were buddies, because in earlier times things would have begun to get out of control.” 

The Turner-Webster friendship was increasingly tested as the FBI director urged Attorney General Bell to prosecute more spies. “It wasn’t a simple thing, ” Webster recalled. “Whether the government actually went ahead and prosecuted a spy was not actually the FBI’s province, though we could decide whether or not to refer cases for prosecution. But I actively supported Griffin Bell, and urged him to go forward against spies who did not enjoy diplomatic immunity.” The main rationale for that push was public awareness. Webster’s theory was, “You try people in the courtroom, and that’s how you convince the public that hostile intelligence is recruiting defense employees, breaking into briefcases, and so on.” Webster also wanted to send a stark message to the KGB at a time when the sheer numbers of Soviet and bloc personnel in the United States, a legacy of détente, were simply overwhelming the Bureau. The FBI figured that a minimum of eight hundred Soviet-bloc intelligence officers were working permanently in-country, but Webster had fewer than two hundred agents to track them. He needed all the help he could get, and that meant not only prosecutions, but hair-trigger deportations and especially the denial of visas. It also meant overcoming his old friend’s objections. 

“It was the War of the Granting of Visas, ” Webster said. “Often the denial of visas would coincide with some effort by CIA to do something, where they feared retaliation. The Agency didn’t necessarily want hostile intelligence here any more than we did, but they wanted to be sure none of this endangered their ability to put people in place elsewhere. And it was true that, the more actively aggressive and public FBI activities were, in prosecution or expulsion, the more likely the Soviets would be to retaliate against CIA, particularly in the Soviet Union. So our interests appeared to be competing. In most cases, CIA wanted to learn, like they were looking at ants under glass. My job was to wreck the whole ant farm, at least all the tunnels in this country. Sometimes I acceded to CIA; in others I went ahead despite Stan’s objections. It was a question of balance ” 

If so, it was a balance that tipped dramatically in favor of the Bureau, through a series of battles in spring and summer 1978. The trouble began in May, at a shopping center in Woodbridge, New Jersey. In a double-agent operation code-named “Lemonade, ” the FBI had dangled a Navy man to a Soviet spy ring operating out of a yacht in the Caribbean. Two Soviet UN staffers had consequently come to Woodbridge to retrieve microfilm of doctored anti-submarine secrets, which the Navy man had left in an orange-juice carton. Arrested in the act were Rudolf P. Cherneyev and Vladik A. Enger. When Webster referred their case to Justice for prosecution, Turner protested that this would “start a spy war.” The matter was taken to President Carter, who sided with Justice and the FBI. “I was mad, ” Turner recounted. “It was nowhere near a resignation issue; it wasn’t going to wreck CIA, so I went along. But of course, the spy war did develop.” Indeed, the KGB seized two Americans, practically as hostages: F. Jay Crawford, Moscow service manager for International Harvester, and Martha Petersen, an employee of the U.S. Embassy in Moscow. After Cherneyev and Enger were convicted, which let the FBI make its point to the public, a trade was finally effected, which took pressure off CIA. So ended the “spy war” of spring and summer 1978, but a new skirmish soon erupted. 

In March of that year, former CIA watch officer William Kampiles had flown to Athens and given the Soviets a System Technical Manual for the U.S. KH-11 surveillance satellite. Its loss destroyed U.S. ability to verify Soviet compliance with the Strategic Arms Limitation Treaty (SALT); Kampiles had sold this information for $3,000. When CIA photo interpreters noticed that the Soviets were evading the KH-11, the FBI was asked to investigate a possible leak, and Kampiles was arrested in August. Again Webster had a chance to raise public consciousness at a trial; again Turner protested. CIA did not want to produce as evidence a copy of the KH-11 manual, but Bureau officials were not particularly sympathetic. “The case was embarrassing to CIA to begin with, ” James Nolan said. “Here was some little flunky, who had not only gotten access to an extremely sensitive document, but the Agency didn’t know it was gone. The whole thing was a case that I think they would have liked to see go quietly into the woodwork somewhere”—especially since the Agency discovered that an additional fourteen copies of the manual could not be found. 

The dispute over prosecution was settled when President Carter sided with Webster. That was Turner’s second defeat in two months, and it marked a major turning point in U.S. policy toward spies. But there was another aspect of the case with important CI implications. Several months before his arrest, Kampiles had offered to become a double agent for CIA, and had written the Agency a memo admitting contact with the KGB in Athens. Yet CIA had refused to talk to him, and had not even opened his letter until the Soviets began hiding their missiles. When asked at Kampiles’ trial why CIA had not looked into the Kampiles case sooner, Soviet Division officers said they worried it might be improper for CIA to be investigating “a U.S. person.” Such activity had been forbidden by Executive Order 12036, issued by President Carter in January 1978. CIA was allowed to conduct “counterintelligence” activities outside the United States, and to coordinate CI domestically, but Carter had redefined CI so that Kampiles was merely a “personnel, documents, or communications security” probe, which could not be undertaken against a United States citizen, or anyone in the U.S., without a judicial warrant. Since there was no firm evidence, in April 1978, that Kampiles had yet violated any criminal statutes, CIA could hardly request the FBI to conduct a criminal investigation. 

“Only when there are suspicions that a law has been broken can the FBI conduct surveillance, ” Turner later said. “That may not come until many secrets have been lost. We pay a price for respecting the rights of our citizens, and therefore must accept that our counterintelligence efforts will never be as effective as the KGB’s.” 

AMONG THE OTHER PRICES paid for respecting the rights of American citizens was a virtual ban on FBI or CIA coverage of Americans abroad, at places like Jonestown, Guyana. In the age of Operation Chaos, the FBI and CIA would have been all over a communist revolutionary like the Reverend Jim Jones, who claimed to be “the dual reincarnation of Christ and Marx, ” and whose People’s Temple offered daily training in guerrilla warfare. That much the U.S. government knew from Jones’ chief radio operator, Mike Carter, who had defected from the cult in 1977, after serving as a courier between Jones and the Soviet Embassy in Guyana. But neither CIA nor FBI would investigate Jones overseas. Restrictions on the coverage of Americans had caused CIA to believe that Jonestown was the province of the FBI, and the Bureau to believe it was Agency turf. 

Although Carter’s executive order would have allowed CIA to cover Americans abroad if “the person being surveilled is reasonably believed to be acting on behalf of a foreign power, ” that loophole was closed on October 25, 1978, when Congress, in an attempt to prevent any future Operation Chaos or mail-opening projects, passed the Foreign Intelligence Surveillance Act (FISA). Under FISA, warrants were required for all surveillance, even when a suspected foreign agent was being monitored. Requests for warrants had to be submitted to a special FISA court, whose judges were sworn to secrecy. Both Turner and Webster welcomed the procedure, if somewhat warily, because it at least promised to keep Congress off their backs, while giving FBI and CIA coverage legal footing. But CI officers at the working levels of both agencies were less enthusiastic about the new regulations, especially since they seemed to impose an impossible paradox. The meeting minutes of a 1979 interagency CI colloquium recorded a general complaint that, “In order to convince a judge to issue a warrant, it was necessary to show that sufficient evidence existed, ‘probable cause, ’ yet the collection of that evidence could only be done through surveillance of some sort. A Catch 22 situation!” 

Because there were stiff penalties for violating FISA, each agency began to look to the other in the coverage of Americans, whereas previously each would simply have invaded the other’s turf. Both agencies thus refused to accept information volunteered by a private American ham-radio operator, who monitored shortwave-radio conversations between People’s Temple members in Jonestown and San Francisco, and who kept a detailed two-hundred-page memo log which referred to planned acts of “self-defense.” The FBI did look into an allegation that Jones was holding Americans in Jonestown, but no evidence of forced confinement had been developed, and the probe was terminated because no violation of the federal kidnapping statute had occurred. A congressional postmortem on Jonestown observed that “No conclusive evidence is available to indicate that the CIA was acquiring information on Mr. Jones … In this same connection it should be noted that under [laws] which prohibit intelligence gathering on U.S. citizens, the CIA was legally proscribed from engaging in any activities vis-à-vis People’s Temple.” 

It was therefore left for U.S. Congressman Leo Ryan, an NBC camera crew, and American journalists to go in. This direct, open, hostile intelligence-gathering method was the devil’s trigger, destabilizing Jones’ already irrational mind. On November 18, 1978, Ryan was shot and killed, and Jones’ armed lieutenants prepared two fifty-gallon drums of Kool-Aid punch containing cyanide. Anyone who refused to drink would be injected with the solution. A tape recording made by Jones preserved his final act of dialectical heroism. His last words were, “We didn’t commit suicide, we committed an act of revolution!” Over the next few days, nearly a thousand corpses, still clad in bell-bottoms and tube tops, were flown home to the U.S. on military transport, in steel “tempo” coffins not used since the Vietnam War. Jones’ will, drafted by Lee Harvey Oswald’s lawyer, Mark Lane, bequeathed most of the People’s Temple estate—$7 million—to the Communist Party of the U.S.A. and to the Soviet Union. 

Stansfield Turner would later let on that an overcautious, tiptoeing approach had kept CIA’s man in Guyana, twenty-year veteran Richard Dwyer, from getting too involved. “I do remember getting into the Jim Jones case, ” Turner said, “and all I can say is that the CIA did not handle that well. I recall something about us not getting to the airfield on time. We had indications that something could go wrong, I will say that, but not the kind that would hold up in court. It was the decision of our person there. It wasn’t something where I administered punishment, but he wasn’t the kind of person I’d promote next week, if you know what I mean. Whatever we did down there, we didn’t do it with the kind of smoothness we should have. I don’t know that it would have stopped the suicides, but it was an issue. It was a case involving Americans, and that was FBI, so we stayed around the edges.” 

Webster later explained that the FBI had taken just the opposite position. “The Bureau did a lot of investigation of the Jones organization, on the West Coast, church groups and what they were doing there, ” Webster said. “But what was the jurisdiction overseas? It’s pretty hard to find.” 

Several months after Jonestown, current and former CI officials from both agencies held a round-table discussion on how to close coverage gaps. It was noted in a record of the session: “In the case of the People’s Temple, which concerned the activities of a group of American citizens abroad, neither agency felt they could intervene. The CIA did not act because American citizens were involved, while the FBI had declined to enter the case because it was primarily a religious matter beyond U.S. borders.” 

That was Monday-morning quarterbacking, of course,but no other kind was possible in the case, for U.S. intelligence had played the Jonestown game with no quarterback at all. Both agencies did become actively involved after the mass deaths, when FISA permitted; until then, nothing meaningful was done. Nor could it have been, legally. Only Congressman Ryan and NBC News had the authority to gather information on Jones. The post-Watergate regulation of American intelligence had thus achieved an irony that was at once tragic and absurd. Congress and the media could collect intelligence on Americans, but America’s intelligence agencies could not. 

JIM WHALEN, FBI liaison officer to CIA, quit just after Jonestown, saying that a year of the job was about all he could take. As with the other liaison officers who followed Cregar, people had just seemed to bypass him, and he felt he just hadn’t been able to make any impact on the situation. But the new liaison man was determined to be different.

A slim, soft-spoken Virginian, John T. “Jay” Aldhizer was not physically prepossessing. Compared with Papich, DeLoach, and Cregar, who had all been college or pro football players, he seemed about as intimidating as a high-school math teacher. But he had a way of putting people at ease, which was a good quality for a liaison officer, and he was also willing to stay in the job for a while, to work at it, to establish some of the continuity that the position had lacked since Cregar. 

That commitment was crucial, for it would take at least two years for Aldhizer just to get to know all the relevant personalities at CIA, and to learn the organizational ropes, and often he would only be cut in when something was already a problem. “That was a big drawback, ” he recalled. “As long as things were going smoothly, and Joe Blow in the Agency knew who to deal with in the Bureau, and vice versa, everything went along okay. But it broke down.” 

An early test for Aldhizer came during the Iranian hostage crisis. The seizure of the U.S. Embassy in Tehran on November 4, 1979, created a unique turf problem. The Bureau had jurisdiction in the recovery of American hostages under some U.S. kidnapping laws, but the Agency had a clear interest because many of the hostages were being held in CIA offices at the embassy. Turner was considering a number of paramilitary rescue operations, in coordination with the Joint Chiefs of Staff, while Webster was facing a difficult hostage-negotiation dilemma. Both tracks were constrained by President Carter’s indecision, but Aldhizer meanwhile had to make sure that negotiations with the kidnappers didn’t interfere with what CIA was trying to do, and vice versa. He also had to put a lot of people from the FBI’s criminal division in touch with Farsi translators, and fast. Where else to get them but Langley? The dimensions of the crisis somehow made bureaucratic infighting seem out of place, and Aldhizer would remember the teamwork during the hostage crisis as one of the “high points” of his liaison work. 

But the Iranian situation spilled over into other spheres, causing unexpected conflicts. Because the Iranians’ declared reason for seizing the embassy had been to protest a U.S. decision to repatriate the Shah, it was important that safe-havens be kept open for him in other countries. One of the countries that was considering inviting the Shah was the Bahamas, where both CIA and FBI were trying to capture the world’s most wanted man, fugitive financier Robert Vesco. Accused of defrauding investors of $220 million and making an illegal campaign contribution of $200,000 to Richard Nixon’s re-election campaign, Vesco had fled the country in 1972. After he had been on the run seven years, CIA learned that he was hiding on Cistern Cay, where he paid government officials for protection, and rented a palatial house on a high sea-bluff. The FBI moved in on Vesco in late 1979 under Operation Kingfish, which used a fifty-five-foot pleasure yacht and a crew of scuba-diving G-men dressed up as Arabs. They anchored a mile or so from Vesco’s house, and set up a concealed camera with a huge telescopic lens. The idea was to catch Bahamian officials taking bribes, and then use that knowledge as a lever to gain cooperation in a plan to abduct Vesco, jab him with a drugged needle, and transport him to a U.S. submarine testing base in the Bahamas, where he could be legally arrested and flown back to the mainland. 

Operation Kingfish was delayed, however, when CIA’s station chief in Nassau invoked certain policy considerations. It was important not to offend or embarrass certain Bahamian officials. At issue was potential sanctuary not only for the Shah of Iran, but for another recently deposed U.S.-backed potentate, former Nicaraguan president Anastasio Somoza. The Agency also feared that any heavy-handed seizure of Vesco could upset negotiations with the Bahamians over continued U.S. rights to the submarine-testing base. While the final move in Kingfish was being debated in Washington, Vesco was tipped to the FBI’s decidedly un-clandestine presence nearby, and slipped out one night by boat. Between them, FBI and CIA had blown America’s best chance at nabbing the notorious financier, who soon took refuge in Sandinista-ruled Nicaragua, and then in Castro’s Cuba. 

The FBI blamed CIA for the costly hiatus, but the Agency was irate that FBI flatfeet had spooked Vesco, especially since CIA was running its own (warrant backed) coverage of Vesco in the Bahamas and felt it had a “handle” on him there. A CIA memo of Vesco’s Cistern Cay period noted “spectral analysis” of the fugitive’s radio broadcasts, as well as coverage of his mail and telephone, and even referred to the accuracy of “NOAA [satellite] material.” The Agency had Vesco like Webster’s proverbial ant under glass, and the FBI had disturbed the environment. 

One of the factors in CIA’s resistance to Kingfish— viz., Agency support and concern for the Shah of Iran— was to foil yet another FBI investigation, only three months later, which aimed at the extradition of Panamanian Military Intelligence chief Manuel Noriega. In January 1980, FBI agents in Miami began investigating Noriega’s involvement in illegal arms trafficking from the U.S. to the Castro-backed Sandinista guerrillas who had recently overthrown Somoza. As it happened, however, the Shah was wintering in Panama City until accommodations in the Bahamas could be arranged, and Noriega was personally charged with his security after the Ayatollah Khomeini publicly announced that Carlos the Jackal had been hired to assassinate the Shah. Thus was Frank Gibbons, the FBI’s legal attach éin Panama, warned in late January by CIA’s Panama station chief, Joe Kisyonaga, that the Panamanian government would be embarrassed if the one man most directly concerned with the Shah’s safety were to be indicted. CIA’s concern about Noriega certainly ran deeper than it let on to the Bureau, however, since Noriega, despite known contacts with Cuban intelligence, had been put on CIA’s payroll during William Colby’s tenure as DCI, and was given control of an Agency slush fund for the recruitment and payment of agents in Panama. Hauling Noriega into court threatened not only the Shah but could expose CIA’s long-standing relationship with Noriega. The upshot was that the Bureau was called off CIA’s man in Panama. “Unfortunately, ” the investigating agents’ supervisor recorded in a memo, “those of us in law enforcement in Miami find ourselves frequently attempting to enforce the laws of the United States, but simultaneously being caught between foreign policy considerations over which we have no control (and often no knowledge).” 

BY SUMMER 1980, the need for improved FBI-CIA liaison was a recurring theme in overhaul proposals, especially in books and lectures by retired CIA officers. Former Soviet Division officer Harry Rositzke urged a truly binding coordinating authority “to assure that no Soviet agent profits from American rivalry.” William Colby urged “an act of Congress defining the roles and rules for American intelligence, ” in which the division between CIA’s foreign intelligence mission and the FBI’s internal-security activities … should be plainly stated.” And at a colloquium of current and former CI officials, former CIA mole hunter Miler urged that CI be put “on a functional not a geographic basis.” When there were problems, the NSC must “harmonize relationships” by “establishing authoritative coordination.” 

Miler’s audience was generally receptive, but there was considerable hand-wringing about just how to “harmonize relationships” without sacrificing flexibility. “The problem was also raised of how to close gaps in coverage when some activities were under the jurisdiction of the FBI and some under that of the CIA, ” noted a summary of the discussion. “Former professionals believed that reorganization and the passage of new legislation [to improve FBI-CIA coordination] was not the answer [since] coordination between the agencies could not be legislated.” But many participants felt that such bold plans must be tried if the U.S. was to replace what the minutes-keeper referred to as “a rotting root system.” 

Sensitive to such complaints, Turner and Webster in 1980 attempted to force the two agencies together operationally in at least one important area: the recruitment of Soviet intelligence personnel in Washington. Code-named “Courtship, ” the project was to capitalize on contacts established by Aldhizer, Nolan, and Cregar with CIA’s Soviet Division. Whenever a Soviet visitor entered the U.S., an FBI counterintelligence squad would be assigned to determine whether he was KGB. Courtship was then to have first pick among intelligence officers considered prime targets for recruitment or compromise, and FBI agents assessed the targets with assistance from CIA psychologists. KGB officers were tailed by FBI operatives who favored Impala sedans and made a habit of staring into the Soviets’ eyes in supermarkets and shopping malls; the idea was to compose a psychological portrait. Once a target was chosen, the FBI-CIA squad would work exclusively on him until they succeeded or failed, and then move on to the next one. 

It was to be several years before Courtship recruited its first target, however, and creation of the new unit could not stem a general feeling that there was need for a more fundamental rejuvenation. Turner believed CIA needed more help from the FBI or must again enter the domestic field; he also sensed that he himself had gone too far in trying to keep CIA operating legally. He tried to give his officers more leeway, but it was too late; already he symbolized the timidness which seemed to have caused a string of American losses in the Third World, most recently in Nicaragua and Iran. By November 1980, Turner’s deputies were on the verge of mutiny. One of Turner’s senior executives, who later became president of the Association of Foreign Intelligence Officers, recalled: “Ever since the Donovan days, it was a tradition that you stood up when the Director came into the room. That was a very clear indication of how you felt about him. But I remember once when Turner walked in. Nobody stood.” 

Ronald Reagan and the Republicans made an issue of the “debilitated” CIA and its director in the 1980 presidential-election campaign. Turner hoped that he might be kept on even if Carter lost, but it was hard for him to remain optimistic. On election eve, when he half jokingly asked for a secret straw vote of his top fifteen deputies, the result was: Carter, 2; Reagan, 13. That stinging rebuke, delivered by some of the most politically liberal individuals in government, would just about reflect the proportion of Reagan’s electoral-college victory. The morning after the election, there was manifest elation in the corridors at Langley; CIA officers weren’t quite jumping up and down, but there were a lot of smiles, and people were walking more briskly. No one thought the Agency’s problems would be over, but there was hope that they could be confronted forthrightly, with a renewed sense of mission. For most of the next eight years, that would be true. Thus were old turf problems to assume new forms, shaped largely by aggressive post-Carter attempts at the “rollback” of Soviet interests around the world.

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