Legacy of Ashes (The History of the C.I.A.) Read online

  Like every director of central intelligence who followed him, he was given great responsibility without equivalent authority. He had no direction from the White House. The trouble was that no one really knew what the president wanted—least of all the president himself. Truman said he only needed a daily intelligence digest, to keep from having to read a two-foot stack of cables every morning. It seemed to the charter members of the Central Intelligence Group that it was the only aspect of their work he ever considered.

  Others saw the mission very differently. General Magruder maintained that there was a tacit understanding at the White House that the Central Intelligence Group would operate a clandestine service. If so, not a word of it appeared on paper. The president never spoke of it, so almost no one else in the government recognized the new group’s legitimacy. The Pentagon and the State Department refused to talk to Souers and his people. The army, the navy, and the FBI treated them with the deepest disdain. Souers lasted barely a hundred days as director, though he stayed on to serve the president as an adviser. He left behind only one note of consequence, a top secret memo with the following plea: “There is an urgent need to develop the highest possible quality of intelligence on the USSR in the shortest possible time.”

  The only American insights on the Kremlin in those days came from the newly appointed American ambassador in Moscow, the future director of central intelligence, General Walter Bedell Smith, and his ranking Russia hand, George Kennan.

  “WHAT DOES THE SOVIET UNION WANT?”

  Bedell Smith was a shopkeeper’s son from Indiana who rose from buck private to general without the polish of West Point or a college degree. As Eisenhower’s chief of staff in World War II, he had thought through every battle in North Africa and Europe. His fellow officers respected and feared him; he was Ike’s unsmiling hatchet man. He worked himself beyond exhaustion. After receiving blood transfusions for a bleeding ulcer when he collapsed at the end of a late dinner with Eisenhower and Winston Churchill, he argued his way out of a British hospital and back to his commander’s tent. He had broken bread with Russian military officers, sitting down for awkward dinners at Allied headquarters in Algiers to plan joint operations against the Nazis. He had personally accepted the Nazi surrender that ended the war in Europe, staring down with contempt at the German command in the battered little red schoolhouse in Rheims, France, that served as the American military’s forward headquarters. On V-E Day, May 8, 1945, he had met for a few fleeting minutes in Rheims with Allen Dulles and Richard Helms. Dulles, cursed by gout, hobbling on a crutch, had come to see Eisenhower and win his approval for the creation of an all-powerful American intelligence center in Berlin. Ike had no time for Dulles that morning—a bad omen.

  Bedell Smith arrived in Moscow in March 1946 to be schooled by George Kennan, the chargé d’affaires at the American embassy. Kennan had spent many years in Russia, many dark hours trying to decipher Joseph Stalin. The Red Army had seized almost half of Europe in the war, a prize taken at the terrible price of twenty million Russian dead. Its forces had liberated nations from the Nazis, but now the shadow of the Kremlin was falling over more than 100 million people beyond Russia’s borders. Kennan foresaw that the Soviets would hold their conquests by brute strength. He had warned the White House to prepare for a showdown.

  A few days before Bedell Smith landed in Moscow, Kennan unleashed the most famous cable in the history of American diplomacy, the “long telegram,” an eight-thousand-word portrait of Soviet paranoia. Kennan’s readers—at first a few, in time millions—all seemed to seize on a single line: the Soviets were impervious to the logic of reason but highly sensitive to “the logic of force.” In short order, Kennan would gain fame as the greatest Kremlinologist in the American government. “We had accustomed ourselves, through our wartime experience, to having a great enemy before us,” Kennan reflected many years later. “The enemy must always be a center. He must be totally evil.”

  Bedell Smith called Kennan “the best possible tutor a newly arrived chief of mission could have had.”

  On a cold, starry night in April 1946, Bedell Smith rode a limousine flying the American flag into the fortress of the Kremlin. At the gates, Soviet intelligence officers checked his identity. His car passed the ancient Russian cathedrals and the huge broken bell at the foot of a tall tower within the Kremlin’s walls. Saluting soldiers in high black leather boots and red-striped breeches ushered him inside. He had come alone. They took him down a long corridor, through tall double doors padded with dark green quilted leather. Finally, in a high-ceilinged conference room, the general met the generalissimo.

  Bedell Smith had a double-barreled question for Stalin: “What does the Soviet Union want, and how far is Russia going to go?”

  Stalin stared into the distance, puffing on a cigarette and doodling lopsided hearts and question marks with a red pencil. He denied designs on any other nation. He denounced Winston Churchill’s warning, delivered in a speech a few weeks earlier in Missouri, about the iron curtain that had fallen across Europe.

  Stalin said Russia knew its enemies.

  “Is it possible that you really believe that the United States and Great Britain are united in an alliance to thwart Russia?” Bedell Smith asked.

  “Da,” said Stalin.

  The general repeated: “How far is Russia going to go?”

  Stalin looked right at him and said: “We’re not going to go much further.”

  How much further? No one knew. What was the mission of American intelligence in the face of the new Soviet threat? No one was sure.

  “AN APPRENTICE JUGGLER”

  On June 10, 1946, General Hoyt Vandenberg became the second director of central intelligence. A handsome pilot who had led Eisenhower’s tactical air war in Europe, he now ran a fly-by-night outfit based in a cluster of undistinguished masonry buildings at the far end of Foggy Bottom, atop a small bluff overlooking the Potomac. His command post stood at 2430 E Street, the old headquarters of the OSS, surrounded by an abandoned gasworks, a turreted brewery, and a roller-skating rink.

  Vandenberg lacked three essential tools: money, power, and people. The Central Intelligence Group stood outside the law, in the judgment of Lawrence Houston, general counsel for Central Intelligence from 1946 to 1972. The president could not legally create a federal agency out of thin air. Without the consent of Congress, Central Intelligence could not legally spend money. No money meant no power.

  Vandenberg set out to get the United States back into the intelligence business. He created a new Office of Special Operations to conduct spying and subversion overseas and wrangled $15 million under the table from a handful of congressmen to carry out those missions. He wanted to know everything about the Soviet forces in Eastern and Central Europe—their movements, their capabilities, their intentions—and he ordered Richard Helms to deliver in a hurry. Helms, in charge of espionage in Germany, Austria, Switzerland, Poland, Czechoslovakia, and Hungary, with 228 overseas personnel on his roster, said he felt like “an apprentice juggler trying to keep an inflated beach ball, an open milk bottle and a loaded machine gun in the air.” All over Europe, “a legion of political exiles, former intelligence officers, ex-agents and sundry entrepreneurs were turning themselves into intelligence moguls, brokering the sale of fabricated-to-order information.” The more his spies spent buying intelligence, the less valuable it became. “If there are more graphic illustrations of throwing money at a problem that hasn’t been thought through, none comes to mind,” he wrote. What passed for intelligence on the Soviets and their satellites was a patchwork of frauds produced by talented liars.

  Helms later determined that at least half the information on the Soviet Union and Eastern Europe in the CIA’s files was pure falsehood. His stations in Berlin and Vienna had become factories of fake intelligence. Few of his officers or analysts could sift fact from fiction. It was an ever present problem: more than half a century later, the CIA confronted the same sort of fabrication as it sought
to uncover Iraq’s weapons of mass destruction.

  From the first day Vandenberg took office, he was shaken by terrifying reports from overseas. His daily bulletins generated heat but little light. It was impossible to determine whether the warnings were true, but they went up the chain of command regardless. Flash: a drunken Soviet officer boasted that Russia would strike without warning. Flash: the commander of Soviet forces in the Balkans was toasting the coming fall of Istanbul. Flash: Stalin was prepared to invade Turkey, encircle the Black Sea, and take the Mediterranean and the Middle East. The Pentagon determined that the best way to blunt a Soviet advance was to cut the Red Army’s supply lines in Romania. Senior staff members under the Joint Chiefs started drawing up battle plans.

  They told Vandenberg to prepare the first covert operation of the cold war. In an attempt to carry out that order, Vandenberg changed the mission of the Central Intelligence Group. On July 17, 1946, he sent two of his aides to see Truman’s White House counsel, Clark Clifford. They argued that “the original concept of the Central Intelligence Group should now be altered” to make it an “operating agency.” Without any legal authority, it became one. On that same day, Vandenberg personally asked Secretary of War Robert Patterson and Secretary of State James Byrnes to slip him an additional $10 million in secret funds to finance the work of “intelligence agents all over the world.” They did.

  Vandenberg’s Office of Special Operations set out to create an underground resistance force in Romania. Frank Wisner had left behind a network of agents in Bucharest desperate to work with Americans but deeply infiltrated by Soviet intelligence. Charles W. Hostler, the first station chief in Bucharest for the Office of Special Operations, found himself surrounded by “conspiracy, intrigue, nastiness, double-dealing, dishonesty, occasional murder and assassination” among fascists, communists, monarchists, industrialists, anarchists, moderates, intellectuals, and idealists—“a social and political environment for which young American officers were poorly prepared.”

  Vandenberg ordered Lieutenant Ira C. Hamilton and Major Thomas R. Hall, based at the tiny American military mission in Bucharest, to organize Romania’s National Peasant Party into a resistance force. Major Hall, who had been an OSS officer in the Balkans, spoke some Romanian. Lieutenant Hamilton spoke none. His guide was the one important agent Wisner had recruited two years before: Theodore Manacatide, who had been a sergeant on the intelligence staff of the Romanian army and now worked at the American military mission, translator by day and spy by night. Manacatide took Hamilton and Hall to meet the National Peasant Party leaders. The Americans offered the clandestine support of the United States—guns, money, and intelligence. On October 5, working with the new Central Intelligence station in occupied Vienna, the Americans smuggled the former foreign minister of Romania and five other members of the would-be liberation army into Austria, sedating them, stuffing them in mail sacks, and flying them to safe harbor.

  It took Soviet intelligence and the Romanian secret police only a few weeks to sniff out the spies. The Americans and their chief agent ran for their lives as communist security forces crushed the mainstream Romanian resistance. The Peasant Party’s leaders were charged with treason and imprisoned. Manacatide, Hamilton, and Hall were convicted in absentia at a public trial after witnesses swore that they had represented themselves as agents of a new American intelligence service.

  Frank Wisner opened The New York Times on November 20, 1946, and read a short article on page ten reporting that his old agent Manacatide, “formerly employed by the United States Mission,” had been sentenced to life imprisonment, “on the grounds that he accompanied a Lieutenant Hamilton of the American Military Mission to a National Peasant congress.” By winter’s end, nearly every one of the Romanians who had worked for Wisner during the war was jailed or killed; his personal secretary had committed suicide. A brutal dictatorship took control of Romania, its rise to power hastened by the failure of American covert action.

  Wisner left his law firm and went to Washington, securing a post at the State Department, where he oversaw the occupied zones of Berlin, Vienna, Tokyo, Seoul, and Trieste. He had greater ambitions. He was convinced that the United States had to learn to fight in a new way, with the same skills and the same secrecy as its enemy.

  3. “FIGHT FIRE WITH

  FIRE”

  Washington was a small town run by people who believed that they lived in the center of the universe. Their city within the city was Georgetown, a square-mile enclave of cobblestone streets lush with magnolias. In its heart, at 3327 P Street, stood a fine four-story house built in 1820, with an English garden out back and a formal dining room with high windows. Frank and Polly Wisner made it their home. On Sunday evenings in 1947, it became the seat of the emerging American national-security establishment. The foreign policy of the United States took shape at the Wisners’ table.

  They started a Georgetown tradition, a Sunday night potluck supper. The main dish was liquor, all hands having sailed out of the Second World War on a tide of alcohol. The Wisners’ eldest son, Frank’s namesake, who in time rose to the heights of American diplomacy, saw the Sunday night suppers as “extraordinarily important events. They were not just trifling social affairs. They became the very lifeblood of the way the government thought, fought, worked, compared notes, made up its mind, and reached consensus.” After dinner, in the British tradition, the ladies retired, the gentlemen remained, and the bold ideas and boozy banter went late into the night. On any given evening the guests might include Wisner’s close friend David Bruce, the OSS veteran en route to becoming the American ambassador in Paris; Chip Bohlen, counsel to the secretary of state and a future ambassador to Moscow; Undersecretary of State Robert Lovett and the future secretary of state Dean Acheson; and the newly eminent Kremlinologist George Kennan. These men believed it was in their power to change the course of human events, and their great debate was how to stop a Soviet takeover of Europe. Stalin was consolidating his control of the Balkans. Leftist guerrillas battled a right-wing monarchy in the mountains of Greece. Food riots broke out in Italy and France, where communist politicians called for general strikes. British soldiers and spies were pulling out of their posts all over the world, leaving wide swaths of the map open for the communists. The sun was setting on the British Empire; the exchequer could not sustain it. The United States was going to have to lead the free world alone.

  Wisner and his guests listened closely to Kennan. They had absorbed his “long telegram” from Moscow and they shared his view of the Soviet threat. So did Navy Secretary James Forrestal, soon to be the first secretary of defense, a Wall Street wonder boy who saw communism as a fanatical faith to be fought with a still-deeper conviction. Forrestal had become Kennan’s political patron, installing him in a general’s mansion at the National War College and making his work required reading for thousands of military officers. Director of Central Intelligence Vandenberg brainstormed with Kennan about how to spy on Moscow’s atomic weapons work. The new secretary of state, George C. Marshall, the chief of the U.S. Army in World War II, determined that the nation needed to reshape its foreign policy, and in the spring he put Kennan in charge of the State Department’s new Policy Planning Staff.

  Kennan was drawing up a battle plan for the newly named cold war. Within the course of six months, the ideas of this obscure diplomat gave rise to three forces that shaped the world: the Truman Doctrine, a political warning to Moscow to halt its subversion of foreign nations; the Marshall Plan, a global bastion for American influence against communism; and the clandestine service of the Central Intelligence Agency.

  “THE GREATEST INTELLIGENCE SERVICE IN THE WORLD”

  In February 1947, the British ambassador had warned acting secretary of state Dean Acheson that England’s military and economic aid to Greece and Turkey would have to cease in six weeks. The Greeks would need something on the order of a billion dollars over the next four years to fight the threat of communism. From Moscow, Walter
Bedell Smith sent his assessment that British troops were the only force keeping Greece from falling into the Soviet orbit.

  At home, the red scare was rising. For the first time since before the Great Depression, the Republicans now controlled both houses of Congress, with men like Senator Joseph McCarthy of Wisconsin and Congressman Richard Nixon of California gaining power. Truman’s popularity was plunging; his approval rating in public opinion polls had fallen 50 points since the end of the war. He had changed his mind about Stalin and the Soviets. He was now convinced that they were an evil abroad in the world.

  Truman and Acheson summoned Senator Arthur Vandenberg, the Republican chairman of the Committee on Foreign Relations. (The newspapers that day noted that the senator’s nephew Hoyt soon would be relieved as director of central intelligence, after only eight months in power.) Acheson explained that a communist beachhead in Greece would threaten all of Western Europe. The United States was going to have to find a way to save the free world—and Congress was going to have to pay the bill. Senator Vandenberg cleared his throat and turned to Truman. “Mr. President,” he said, “the only way you are ever going to get this is to make a speech and scare the hell out of the country.”