What Handouts To Cut

August 18th, 2010 Comments off

From Townhall.com

By Walter E. Williams

Because of failure to heed the limitations of the U.S. Constitution, which has produced runaway federal spending, our nation sits on the precipice of disaster. Former Senator Alan Simpson of Wyoming and Erskine Bowles, White House chief of staff under President Bill Clinton, co-chairmen of President Obama’s debt and deficit commission, in a Washington Post article “Obama’s Debt Commission Warns of Fiscal ‘Cancer’” (July 12, 2010) said that “(A)t present, federal revenue is fully consumed by three programs: Social Security, Medicare and Medicaid. The rest of the federal government, including fighting two wars, homeland security, education, art, culture, you name it, veterans — the whole rest of the discretionary budget is being financed by China and other countries.”

The commission added the current budget trend is a disaster “that will destroy the country from within” unless checked by tough action in Washington. The tough action required is spending cuts in programs, including the so-called nondiscretionary, eating most of the federal revenues.

According to the Census, around 80 percent of Americans 65 and older own their own homes compared to 43 percent under 35. Twenty-three million households, or 37 percent of all homeowners, own their homes free and clear, and most of these are seniors aged 65 and older. According to the Federal Reserve Board’s 2007 “Survey of Consumer Finances,” the median net worth of people 65 and over is $232,000, those under 35 years have a net worth of $12,000 and for those 35-44, it’s $87,000.

For good reason, older people have accumulated more wealth than younger people; the primary reason is that they’ve had more time to do it. There is no logical case that can be made for using the tax system to force Americans with less wealth to subsidize those with more wealth. But it’s not clear who is subsidizing whom. Consider an elderly widow, say 70 years old, with a modest retirement income of $18,000 living in a $300,000 house that’s fully paid for. She might receive local property tax forgiveness, medical and prescription drug subsidies and other federal, state and local subsidies based upon her age and income.

When subsidies are provided for this lady, whom are we truly benefiting? It’s not the lady but her heirs. Conceivably, the lady could make a deal with a financial institution to pay her property taxes, allow her to live in the house for the rest of her life and give her a lump sum cash settlement so that she can live without the handouts. Upon her death, the house becomes the property of the financial institution, not her heirs. Giving the widow handouts allows her to bequeath to her heirs her assets, a $300,000 house. If her children want to inherit the house, they, rather than taxpayers, ought to take care of their mother.

We can start getting the federal spending under control by ending subsidies to people with high net worth that can be ready turned into cash such as a home or business. While seniors might say that they support reduced government spending, they, like other handout recipients, believe they have a right, through government, to live at the expense of others. What’s more, they have considerable clout — they vote in large numbers. Only 50 percent of young people vote, but up to 70 percent of seniors vote.

Political guts have always been in short supply and politicians fear senior retaliation at the polls. Moreover, it’s a practical matter for seniors and politicians. The true economic calamity won’t hit the country until 2030 or 2040. By that time, both today’s politicians and seniors will be dead so why should they make sacrifices now to prevent an economic calamity decades off into the future? Seniors might protest my cynicism but they can easily prove me wrong by waging an effective campaign to end handouts based on superannuation.

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Video: Walter E. Williams – The Issue is Private Property

August 18th, 2010 Comments off

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U.S. Is Bankrupt and We Don’t Even Know It

August 17th, 2010 Comments off

From Bloomberg

Let’s get real. The U.S. is bankrupt. Neither spending more nor taxing less will help the country pay its bills.

What it can and must do is radically simplify its tax, health-care, retirement and financial systems, each of which is a complete mess. But this is the good news. It means they can each be redesigned to achieve their legitimate purposes at much lower cost and, in the process, revitalize the economy.

Last month, the International Monetary Fund released its annual review of U.S. economic policy. Its summary contained these bland words about U.S. fiscal policy: “Directors welcomed the authorities’ commitment to fiscal stabilization, but noted that a larger than budgeted adjustment would be required to stabilize debt-to-GDP.”

But delve deeper, and you will find that the IMF has effectively pronounced the U.S. bankrupt. Section 6 of the July 2010 Selected Issues Paper says: “The U.S. fiscal gap associated with today’s federal fiscal policy is huge for plausible discount rates.” It adds that “closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 percent of U.S. GDP.”

The fiscal gap is the value today (the present value) of the difference between projected spending (including servicing official debt) and projected revenue in all future years.

Double Our Taxes

To put 14 percent of gross domestic product in perspective, current federal revenue totals 14.9 percent of GDP. So the IMF is saying that closing the U.S. fiscal gap, from the revenue side, requires, roughly speaking, an immediate and permanent doubling of our personal-income, corporate and federal taxes as well as the payroll levy set down in the Federal Insurance Contribution Act.

Such a tax hike would leave the U.S. running a surplus equal to 5 percent of GDP this year, rather than a 9 percent deficit. So the IMF is really saying the U.S. needs to run a huge surplus now and for many years to come to pay for the spending that is scheduled. It’s also saying the longer the country waits to make tough fiscal adjustments, the more painful they will be.

Is the IMF bonkers?

No. It has done its homework. So has the Congressional Budget Office whose Long-Term Budget Outlook, released in June, shows an even larger problem.

‘Unofficial’ Liabilities

Based on the CBO’s data, I calculate a fiscal gap of $202 trillion, which is more than 15 times the official debt. This gargantuan discrepancy between our “official” debt and our actual net indebtedness isn’t surprising. It reflects what economists call the labeling problem. Congress has been very careful over the years to label most of its liabilities “unofficial” to keep them off the books and far in the future.

For example, our Social Security FICA contributions are called taxes and our future Social Security benefits are called transfer payments. The government could equally well have labeled our contributions “loans” and called our future benefits “repayment of these loans less an old age tax,” with the old age tax making up for any difference between the benefits promised and principal plus interest on the contributions.

The fiscal gap isn’t affected by fiscal labeling. It’s the only theoretically correct measure of our long-run fiscal condition because it considers all spending, no matter how labeled, and incorporates long-term and short-term policy.

$4 Trillion Bill

How can the fiscal gap be so enormous?

Simple. We have 78 million baby boomers who, when fully retired, will collect benefits from Social Security, Medicare, and Medicaid that, on average, exceed per-capita GDP. The annual costs of these entitlements will total about $4 trillion in today’s dollars. Yes, our economy will be bigger in 20 years, but not big enough to handle this size load year after year.

This is what happens when you run a massive Ponzi scheme for six decades straight, taking ever larger resources from the young and giving them to the old while promising the young their eventual turn at passing the generational buck.

Herb Stein, chairman of the Council of Economic Advisers under U.S. President Richard Nixon, coined an oft-repeated phrase: “Something that can’t go on, will stop.” True enough. Uncle Sam’s Ponzi scheme will stop. But it will stop too late.

And it will stop in a very nasty manner. The first possibility is massive benefit cuts visited on the baby boomers in retirement. The second is astronomical tax increases that leave the young with little incentive to work and save. And the third is the government simply printing vast quantities of money to cover its bills.

Worse Than Greece

Most likely we will see a combination of all three responses with dramatic increases in poverty, tax, interest rates and consumer prices. This is an awful, downhill road to follow, but it’s the one we are on. And bond traders will kick us miles down our road once they wake up and realize the U.S. is in worse fiscal shape than Greece.

Some doctrinaire Keynesian economists would say any stimulus over the next few years won’t affect our ability to deal with deficits in the long run.

This is wrong as a simple matter of arithmetic. The fiscal gap is the government’s credit-card bill and each year’s 14 percent of GDP is the interest on that bill. If it doesn’t pay this year’s interest, it will be added to the balance.

Demand-siders say forgoing this year’s 14 percent fiscal tightening, and spending even more, will pay for itself, in present value, by expanding the economy and tax revenue.

My reaction? Get real, or go hang out with equally deluded supply-siders. Our country is broke and can no longer afford no- pain, all-gain “solutions.”

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US Breast Cancer Drug Decision ‘Marks Start of Death Panels’

August 17th, 2010 Comments off

From The Telegraph (UK)

A decision to rescind endorsement of the drug would reignite the highly charged debate over US health care reform and how much the state should spend on new and expensive treatments.

Avastin, the world’s best selling cancer drug, is primarily used to treat colon cancer and was approved by the US Food and Drug Administration in 2008 for use on women with breast cancer that has spread.

It costs $8,000 (£5,000) a month and is given to about 17,500 women in the US a year. The drug was initially approved after a study found that, by preventing blood flow to tumours, it extended the amount of time until the disease worsened by more than five months. However, two new studies have shown that the drug may not even extend life by an extra month.

The FDA advisory panel has now voted 12-1 to drop the endorsement for breast cancer treatment. The panel unusually cited “effectiveness” grounds for the decision. But it has been claimed that “cost effectiveness” was the real reason ahead of reforms in which the government will extend health insurance to the poorest.

If the approval of the drug is revoked then US insurers would be likely to stop paying for Avastin.

The Avastin recommendation led to revived allegations that President Barack Obama’s overhaul of the US health care system would mean many would be denied treatments currently available.

During the debate, those opposed to the reforms cited Britain’s National Institute for Clinical Excellence, which decides whether new treatments should be made available on the NHS on the basis of cost effectiveness, as an example of the sort of drug rationing that amounted to a “death panel”.

David Vitter, the Republican Senator for Louisiana, said the FDA decision amounted to rationing health care.

“I shudder at the thought of a government panel assigning a value to a day of a person’s life,” he said. “It is sickening to think that care would be withheld from a patient simply because their life is not deemed valuable enough.

“I fear this is the beginning of a slippery slope leading to more and more rationing under the government takeover of health care that is being forced on the American people.”

Avastin has been described as “the poster child for expensive anti-cancer drugs”.

When reviewing drugs for approval the FDA is only charged with looking at their health risks and benefits, not cost effectiveness. It usually follows advisory panel recommendations. A final decision will be announced on Sept 17.

Avastin made $5.9 billion (£3.8 billion) in sales last year and is made by Genentech, a San Francisco-based unit of the Swiss drug maker Roche.

It is also approved for colon, lung, kidney and brain cancer, however, the FDA review and recommendation applies only to breast cancer.

An FDA spokeswoman said: “Avastin should be an option for patients with this incurable disease.”

Breast cancer is the second most common cause of cancer death among US women, with 40,000 last year.

In the UK the National Institute for Clinical Excellence is reviewing whether Avastin should be available on the NHS for woman with breast cancer that has spread.

A spokeswoman said: “We will continue to investigate the treatment regardless of the FDA decision.”

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The CIA and the Media

August 17th, 2010 Comments off

After leaving The Washington Post in 1977, Carl Bernstein spent six months looking at the relationship of the CIA and the press during the Cold War years. His 25,000-word cover story, published in Rolling Stone on October 20, 1977, is reprinted below.

THE CIA AND THE MEDIA

How Americas Most Powerful News Media Worked Hand in Glove with the Central Intelligence Agency and Why the Church Committee Covered It Up

BY CARL BERNSTEIN

In 1953, Joseph Alsop, then one of America’s leading syndicated columnists, went to the Philippines to cover an election. He did not go because he was asked to do so by his syndicate. He did not go because he was asked to do so by the newspapers that printed his column. He went at the request of the CIA.

Alsop is one of more than 400 American journalists who in the past twenty‑five years have secretly carried out assignments for the Central Intelligence Agency, according to documents on file at CIA headquarters. Some of these journalists’ relationships with the Agency were tacit; some were explicit. There was cooperation, accommodation and overlap. Journalists provided a full range of clandestine services—from simple intelligence gathering to serving as go‑betweens with spies in Communist countries. Reporters shared their notebooks with the CIA. Editors shared their staffs. Some of the journalists were Pulitzer Prize winners, distinguished reporters who considered themselves ambassadors without‑portfolio for their country. Most were less exalted: foreign correspondents who found that their association with the Agency helped their work; stringers and freelancers who were as interested in the derring‑do of the spy business as in filing articles; and, the smallest category, full‑time CIA employees masquerading as journalists abroad. In many instances, CIA documents show, journalists were engaged to perform tasks for the CIA with the consent of the managements of America’s leading news organizations.

WORKING PRESS — CIA STYLE

To understand the role of most journalist‑operatives, it is necessary to dismiss some myths about undercover work for American intelligence services. Few American agents are “spies” in the popularly accepted sense of the term. “Spying” — the acquisition of secrets from a foreign government—is almost always done by foreign nationals who have been recruited by the CIA and are under CIA control in their own countries. Thus the primary role of an American working undercover abroad is often to aid in the recruitment and “handling” of foreign nationals who are channels of secret information reaching American intelligence.

Many journalists were used by the CIA to assist in this process and they had the reputation of being among the best in the business. The peculiar nature of the job of the foreign correspondent is ideal for such work: he is accorded unusual access by his host country, permitted to travel in areas often off‑limits to other Americans, spends much of his time cultivating sources in governments, academic institutions, the military establishment and the scientific communities. He has the opportunity to form long‑term personal relationships with sources and—perhaps more than any other category of American operative—is in a position to make correct judgments about the susceptibility and availability of foreign nationals for recruitment as spies.

“After a foreigner is recruited, a case officer often has to stay in the background,” explained a CIA official. “So you use a journalist to carry messages to and from both parties”

Journalists in the field generally took their assignments in the same manner as any other undercover operative. If, for instance, a journalist was based in Austria, he ordinarily would be under the general direction of the Vienna station chief and report to a case officer. Some, particularly roving correspondents or U.S.‑based reporters who made frequent trips abroad, reported directly to CIA officials in Langley, Virginia.

The tasks they performed sometimes consisted of little more than serving as “eyes and ears” for the CIA; reporting on what they had seen or overheard in an Eastern European factory, at a diplomatic reception in Bonn, on the perimeter of a military base in Portugal. On other occasions, their assignments were more complex: planting subtly concocted pieces of misinformation; hosting parties or receptions designed to bring together American agents and foreign spies; serving up “black” propaganda to leading foreign journalists at lunch or dinner; providing their hotel rooms or bureau offices as “drops” for highly sensitive information moving to and from foreign agents; conveying instructions and dollars to CIA controlled members of foreign governments.

Often the CIA’s relationship with a journalist might begin informally with a lunch, a drink, a casual exchange of information. An Agency official might then offer a favor—for example, a trip to a country difficult to reach; in return, he would seek nothing more than the opportunity to debrief the reporter afterward. A few more lunches, a few more favors, and only then might there be a mention of a formal arrangement — “That came later,” said a CIA official, “after you had the journalist on a string.”

Another official described a typical example of the way accredited journalists (either paid or unpaid by the CIA) might be used by the Agency: “In return for our giving them information, we’d ask them to do things that fit their roles as journalists but that they wouldn’t have thought of unless we put it in their minds. For instance, a reporter in Vienna would say to our man, ‘I met an interesting second secretary at the Czech Embassy.’ We’d say, ‘Can you get to know him? And after you get to know him, can you assess him? And then, can you put him in touch with us—would you mind us using your apartment?”‘

Formal recruitment of reporters was generally handled at high levels—after the journalist had undergone a thorough background check. The actual approach might even be made by a deputy director or division chief. On some occasions, no discussion would he entered into until the journalist had signed a pledge of secrecy.

“The secrecy agreement was the sort of ritual that got you into the tabernacle,” said a former assistant to the Director of Central Intelligence. “After that you had to play by the rules.” David Attlee Phillips, former Western Hemisphere chief of clandestine services and a former journalist himself, estimated in an interview that at least 200 journalists signed secrecy agreements or employment contracts with the Agency in the past twenty‑five years. Phillips, who owned a small English‑language newspaper in Santiago, Chile, when he was recruited by the CIA in 1950, described the approach: “Somebody from the Agency says, ‘I want you to help me. 1 know you are a true‑blue American, but I want you to sign a piece of paper before I tell you what it’s about.’ I didn’t hesitate to sign, and a lot of newsmen didn’t hesitate over the next twenty years.”

“One of the things we always had going for us in terms of enticing reporters,” observed a CIA official who coordinated some of the arrangements with journalists, “was that we could make them look better with their home offices. A foreign correspondent with ties to the Company [the CIA] stood a much better chance than his competitors of getting the good stories.”

Within the CIA, journalist‑operatives were accorded elite status, a consequence of the common experience journalists shared with high‑level CIA officials. Many had gone to the same schools as their CIA handlers, moved in the same circles, shared fashionably liberal, anti‑Communist political values, and were part of the same “old boy” network that constituted something of an establishment elite in the media, politics and academia of postwar America. The most valued of these lent themselves for reasons of national service, not money.

The Agency’s use of journalists in undercover operations has been most extensive in Western Europe (“That was the big focus, where the threat was,” said one CIA official), Latin America and the Far East. In the 1950s and 1960s journalists were used as intermediaries—spotting, paying, passing instructions—to members of the Christian Democratic party in Italy and the Social Democrats in Germany, both of which covertly received millions of dollars from the CIA. During those years “we had journalists all over Berlin and Vienna just to keep track of who the hell was coming in from the East and what they were up to,” explained a CIA official.

In the Sixties, reporters were used extensively in the CIA offensive against Salvador Allende in Chile; they provided funds to Allende’s opponents and wrote anti‑Allende propaganda for CIA proprietary publications that were distributed in Chile. (CIA officials insist that they make no attempt to influence the content of American newspapers, but some fallout is inevitable: during the Chilean offensive, CIA‑generated black propaganda transmitted on the wire service out of Santiago often turned up in American publications.)

According to CIA officials, the Agency has been particularly sparing in its use of journalist agents in Eastern Europe on grounds that exposure might result in diplomatic sanctions against the United States or in permanent prohibitions against American correspondents serving in some countries. The same officials claim that their use of journalists in the Soviet Union has been even more limited, but they remain extremely guarded in discussing the subject. They are insistent, however, in maintaining that the Moscow correspondents of major news organizations have not been “tasked” or controlled by the Agency.

The Soviets, according to CIA officials, have consistently raised false charges of CIA affiliation against individual American reporters as part of a continuing diplomatic game that often follows the ups and downs of Soviet‑American relations. The latest such charge by the Russians—against Christopher Wren of the New York Times and Alfred Friendly Jr., formerly of Newsweek, has no basis in fact, they insist.

CIA officials acknowledge, however, that such charges will persist as long as the CIA continues to use journalistic cover and maintain covert affiliations with individuals in the profession. But even an absolute prohibition against Agency use of journalists would not free reporters from suspicion, according to many Agency officials. “Look at the Peace Corps,” said one source. “We have had no affiliation there and they [foreign governments] still throw them out”

The history of the CIA’s involvement with the American press continues to be shrouded by an official policy of obfuscation and deception for the following principal reasons:

■ The use of journalists has been among the most productive means of intelligence‑gathering employed by the CIA. Although the Agency has cut back sharply on the use of reporters since 1973 primarily as a result of pressure from the media), some journalist‑operatives are still posted abroad.

■ Further investigation into the matter, CIA officials say, would inevitably reveal a series of embarrassing relationships in the 1950s and 1960s with some of the most powerful organizations and individuals in American journalism.

Among the executives who lent their cooperation to the Agency were Williarn Paley of the Columbia Broadcasting System, Henry Luce of Tirne Inc., Arthur Hays Sulzberger of the New York Times, Barry Bingham Sr. of the LouisviIle Courier‑Journal, and James Copley of the Copley News Service. Other organizations which cooperated with the CIA include the American Broadcasting Company, the National Broadcasting Company, the Associated Press, United Press International, Reuters, Hearst Newspapers, Scripps‑Howard, Newsweek magazine, the Mutual Broadcasting System, the Miami Herald and the old Saturday Evening Post and New York Herald‑Tribune.

By far the most valuable of these associations, according to CIA officials, have been with the New York Times, CBS and Time Inc.

The CIA’s use of the American news media has been much more extensive than Agency officials have acknowledged publicly or in closed sessions with members of Congress. The general outlines of what happened are indisputable; the specifics are harder to come by. CIA sources hint that a particular journalist was trafficking all over Eastern Europe for the Agency; the journalist says no, he just had lunch with the station chief. CIA sources say flatly that a well‑known ABC correspondent worked for the Agency through 1973; they refuse to identify him. A high‑level CIA official with a prodigious memory says that the New York Times provided cover for about ten CIA operatives between 1950 and 1966; he does not know who they were, or who in the newspaper’s management made the arrangements.

The Agency’s special relationships with the so‑called “majors” in publishing and broadcasting enabled the CIA to post some of its most valuable operatives abroad without exposure for more than two decades. In most instances, Agency files show, officials at the highest levels of the CIA usually director or deputy director) dealt personally with a single designated individual in the top management of the cooperating news organization. The aid furnished often took two forms: providing jobs and credentials “journalistic cover” in Agency parlance) for CIA operatives about to be posted in foreign capitals; and lending the Agency the undercover services of reporters already on staff, including some of the best‑known correspondents in the business.

In the field, journalists were used to help recruit and handle foreigners as agents; to acquire and evaluate information, and to plant false information with officials of foreign governments. Many signed secrecy agreements, pledging never to divulge anything about their dealings with the Agency; some signed employment contracts., some were assigned case officers and treated with. unusual deference. Others had less structured relationships with the Agency, even though they performed similar tasks: they were briefed by CIA personnel before trips abroad, debriefed afterward, and used as intermediaries with foreign agents. Appropriately, the CIA uses the term “reporting” to describe much of what cooperating journalists did for the Agency. “We would ask them, ‘Will you do us a favor?’”.said a senior CIA official. “‘We understand you’re going to be in Yugoslavia. Have they paved all the streets? Where did you see planes? Were there any signs of military presence? How many Soviets did you see? If you happen to meet a Soviet, get his name and spell it right …. Can you set up a meeting for is? Or relay a message?’” Many CIA officials regarded these helpful journalists as operatives; the journalists tended to see themselves as trusted friends of the Agency who performed occasional favors—usually without pay—in the national interest.

“I’m proud they asked me and proud to have done it,” said Joseph Alsop who, like his late brother, columnist Stewart Alsop, undertook clandestine tasks for the Agency. “The notion that a newspaperman doesn’t have a duty to his country is perfect balls.”

From the Agency’s perspective, there is nothing untoward in such relationships, and any ethical questions are a matter for the journalistic profession to resolve, not the intelligence community. As Stuart Loory, former Los Angeles Times correspondent, has written in the Columbia Journalism Review: ‘If even one American overseas carrying a press card is a paid informer for the CIA, then all Americans with those credentials are suspect …. If the crisis of confidence faced by the news business—along with the government—is to be overcome, journalists must be willing to focus on themselves the same spotlight they so relentlessly train on others!’ But as Loory also noted: “When it was reported… that newsmen themselves were on the payroll of the CIA, the story caused a brief stir, and then was dropped.”

During the 1976 investigation of the CIA by the Senate Intelligence Committee, chaired by Senator Frank Church, the dimensions of the Agency’s involvement with the press became apparent to several members of the panel, as well as to two or three investigators on the staff. But top officials of the CIA, including former directors William Colby and George Bush, persuaded the committee to restrict its inquiry into the matter and to deliberately misrepresent the actual scope of the activities in its final report. The multivolurne report contains nine pages in which the use of journalists is discussed in deliberately vague and sometimes misleading terms. It makes no mention of the actual number of journalists who undertook covert tasks for the CIA. Nor does it adequately describe the role played by newspaper and broadcast executives in cooperating with the Agency.

THE AGENCY’S DEALINGS WITH THE PRESS BEGAN during the earliest stages of the Cold War. Allen Dulles, who became director of the CIA in 1953, sought to establish a recruiting‑and‑cover capability within America’s most prestigious journalistic institutions. By operating under the guise of accredited news correspondents, Dulles believed, CIA operatives abroad would be accorded a degree of access and freedom of movement unobtainable under almost any other type of cover.

American publishers, like so many other corporate and institutional leaders at the time, were willing to commit the resources of their companies to the struggle against “global Communism.” Accordingly, the traditional line separating the American press corps and government was often indistinguishable: rarely was a news agency used to provide cover for CIA operatives abroad without the knowledge and consent of either its principal owner, publisher or senior editor. Thus, contrary to the notion that the CIA insidiously infiltrated the journalistic community, there is ample evidence that America’s leading publishers and news executives allowed themselves and their organizations to become handmaidens to the intelligence services. “Let’s not pick on some poor reporters, for God’s sake,” William Colby exclaimed at one point to the Church committee’s investigators. “Let’s go to the managements. They were witting.”  In all, about twenty‑five news organizations including those listed at the beginning of this article) provided cover for the Agency.

In addition to cover capability, Dulles initiated a “debriefing” procedure under which American correspondents returning from abroad routinely emptied their notebooks and offered their impressions to Agency personnel. Such arrangements, continued by Dulles’ successors, to the present day, were made with literally dozens of news organizations. In the 1950s, it was not uncommon for returning reporters to be met at the ship by CIA officers. “There would be these guys from the CIA flashing ID cards and looking like they belonged at the Yale Club,” said Hugh Morrow, a former Saturday Evening Post correspondent who is now press secretary to former vice‑president Nelson Rockefeller. “It got to be so routine that you felt a little miffed if you weren’t asked.”

CIA officials almost always refuse to divulge the names of journalists who have cooperated with the Agency. They say it would be unfair to judge these individuals in a context different from the one that spawned the relationships in the first place. “There was a time when it wasn’t considered a crime to serve your government,” said one high‑level CIA official who makes no secret of his bitterness. “This all has to be considered in the context of the morality of the times, rather than against latter‑day standards—and hypocritical standards at that.”

Many journalists who covered World War II were close to people in the Office of Strategic Services, the wartime predecessor of the CIA; more important, they were all on the same side. When the war ended and many OSS officials went into the CIA, it was only natural that these relationships would continue. Meanwhile, the first postwar generation of journalists entered the profession; they shared the same political and professional values as their mentors. “You had a gang of people who worked together during World War II and never got over it,” said one Agency official. “They were genuinely motivated and highly susceptible to intrigue and being on the inside. Then in the Fifties and Sixties there was a national consensus about a national threat. The Vietnam War tore everything to pieces—shredded the consensus and threw it in the air.” Another Agency official observed: “Many journalists didn’t give a second thought to associating with the Agency. But there was a point when the ethical issues which most people had submerged finally surfaced. Today, a lot of these guys vehemently deny that they had any relationship with the Agency.”

From the outset, the use of journalists was among the CIA’s most sensitive undertakings, with full knowledge restricted to the Director of Central Intelligence and a few of his chosen deputies. Dulles and his successors were fearful of what would happen if a journalist‑operative’s cover was blown, or if details of the Agency’s dealings with the press otherwise became public. As a result, contacts with the heads of news  organizations were normally initiated by Dulles and succeeding Directors of Central Intelligence; by the deputy directors and division chiefs in charge of covert operations—Frank Wisner, Cord Meyer Jr., Richard Bissell, Desmond FitzGerald, Tracy Barnes, Thomas Karamessines and Richard Helms himself a former UPI correspondent); and, occasionally, by others in the CIA hierarchy known to have an unusually close social relationship with a particular publisher or broadcast executive.1

James Angleton, who was recently removed as the Agency’s head of counterintelligence operations, ran a completely independent group of journalist‑operatives who performed sensitive and frequently dangerous assignments; little is known about this group for the simple reason that Angleton deliberately kept only the vaguest of files.

The CIA even ran a formal training program in the 1950s to teach its agents to be journalists. Intelligence officers were “taught to make noises like reporters,” explained a high CIA official, and were then placed in major news organizations with help from management. “These were the guys who went through the ranks and were told ‘You’re going to he a journalist,’” the CIA official said. Relatively few of the 400‑some relationships described in Agency files followed that pattern, however; most involved persons who were already bona fide journalists when they began undertaking tasks for the Agency.

The Agency’s relationships with journalists, as described in CIA files, include the following general categories:

■ Legitimate, accredited staff members of news organizations—usually reporters. Some were paid; some worked for the Agency on a purely voluntary basis. This group includes many of the best‑known journalists who carried out tasks for the CIA. The files show that the salaries paid to reporters by newspaper and broadcast networks were sometimes supplemented by nominal payments from the CIA, either in the form of retainers, travel expenses or outlays for specific services performed.  Almost all the payments were made in cash. The accredited category also includes photographers, administrative personnel of foreign news bureaus and members of broadcast technical crews.)

Two of the Agency’s most valuable personal relationships in the 1960s, according to CIA officials, were with reporters who covered Latin America—Jerry O’Leary of the Washington Star and Hal Hendrix of the Miami News, a Pulitzer Prize winner who became a high official of the International Telephone and Telegraph Corporation. Hendrix was extremely helpful to the Agency in providing information about individuals in Miami’s Cuban exile community. O’Leary was considered a valued asset in Haiti and the Dominican Republic. Agency files contain lengthy reports of both men’s activities on behalf of the CIA.

O’Leary maintains that his dealings were limited to the normal give‑and‑take that goes on between reporters abroad and their sources. CIA officials dispute the contention: “There’s no question Jerry reported for us,” said one. “Jerry did assessing and spotting [of prospective agents] but he was better as a reporter for us.” Referring to O’Leary’s denials, the official added: “I don’t know what in the world he’s worried about unless he’s wearing that mantle of integrity the Senate put on you journalists.”

O’Leary attributes the difference of opinion to semantics. “I might call them up and say something like, ‘Papa Doc has the clap, did you know that?’ and they’d put it in the file. I don’t consider that reporting for them…. it’s useful to be friendly to them and, generally, I felt friendly to them. But I think they were more helpful to me than I was to them.” O’Leary took particular exception to being described in the same context as Hendrix. “Hal was really doing work for them,” said O’Leary. “I’m still with the Star. He ended up at ITT.” Hendrix could not be reached for comment. According to Agency officials, neither Hendrix nor O’Leary was paid by the CIA.

■ Stringers2 and freelancers. Most were payrolled by the Agency under standard contractual terms. Their journalistic credentials were often supplied by cooperating news organizations. some filed news stories; others reported only for the CIA. On some occasions, news organizations were not informed by the CIA that their stringers were also working for the Agency.

■ Employees of so‑called CIA “proprietaries.” During the past twenty‑five years, the Agency has secretly bankrolled numerous foreign press services, periodicals and newspapers—both English and foreign language—which provided excellent cover for CIA operatives. One such publication was the Rome Daily American, forty percent of which was owned by the CIA until the 1970s. The Daily American went out of business this year,

■ Editors, publishers and broadcast network executives. The CIAs relationship with most news executives differed fundamentally from those with working reporters and stringers, who were much more subject to direction from the Agency. A few executives—Arthur Hays Sulzberger of the New York Times among them—signed secrecy agreements. But such formal understandings were rare: relationships between Agency officials and media executives were usually social—”The P and Q Street axis in Georgetown,” said one source. “You don’t tell Wilharn Paley to sign a piece of paper saying he won’t fink.”

■ Columnists and commentators. There are perhaps a dozen well known columnists and broadcast commentators whose relationships with the CIA go far beyond those normally maintained between reporters and their sources. They are referred to at the Agency as “known assets” and can be counted on to perform a variety of undercover tasks; they are considered receptive to the Agency’s point of view on various subjects. Three of the most widely read columnists who maintained such ties with the Agency are C.L. Sulzberger of the New York Times, Joseph Alsop, and the late Stewart Alsop, whose column appeared in the New York Herald‑Tribune, the Saturday Evening Post and Newsweek. CIA files contain reports of specific tasks all three undertook. Sulzberger is still regarded as an active asset by the Agency. According to a senior CIA official, “Young Cy Sulzberger had some uses…. He signed a secrecy agreement because we gave him classified information…. There was sharing, give and take. We’d say, ‘Wed like to know this; if we tell you this will it help you get access to so‑and‑so?’ Because of his access in Europe he had an Open Sesame. We’d ask him to just report: ‘What did so‑and‑so say, what did he look like, is he healthy?’ He was very eager, he loved to cooperate.” On one occasion, according to several CIA officials, Sulzberger was given a briefing paper by the Agency which ran almost verbatim under the columnist’s byline in the Times. “Cycame out and said, ‘I’m thinking of doing a piece, can you give me some background?’” a CIA officer said. “We gave it to Cy as a background piece and Cy gave it to the printers and put his name on it.” Sulzberger denies that any incident occurred. “A lot of baloney,” he said.

Sulzberger claims that he was never formally “tasked” by the Agency and that he “would never get caught near the spook business. My relations were totally informal—I had a goodmany friends,” he said. “I’m sure they consider me an asset. They can ask me questions. They find out you’re going to Slobovia and they say, ‘Can we talk to you when you get back?’ … Or they’ll want to know if the head of the Ruritanian government is suffering from psoriasis. But I never took an assignment from one of those guys…. I’ve known Wisner well, and Helms and even McCone [former CIA director John McCone] I used to play golf with. But they’d have had to he awfully subtle to have used me.

Sulzberger says he was asked to sign the secrecy agreement in the 1950s. “A guy came around and said, ‘You are a responsible newsman and we need you to sign this if we are going to show you anything classified.’ I said I didn’t want to get entangled and told them, ‘Go to my uncle [Arthur Hays Sulzberger, then publisher of the New York Times] and if he says to sign it I will.’” His uncle subsequently signed such an agreement, Sulzberger said, and he thinks he did too, though he is unsure. “I don’t know, twenty‑some years is a long time.” He described the whole question as “a bubble in a bathtub.”

Stewart Alsop’s relationship with the Agency was much more extensive than Sulzberger’s. One official who served at the highest levels in the CIA said flatly: “Stew Alsop was a CIA agent.” An equally senior official refused to define Alsop’s relationship with the Agency except to say it was a formal one. Other sources said that Alsop was particularly helpful to the Agency in discussions with, officials of foreign governments—asking questions to which the CIA was seeking answers, planting misinformation advantageous to American policy, assessing opportunities for CIA recruitment of well‑placed foreigners.

“Absolute nonsense,” said Joseph Alsop of the notion that his brother was a CIA agent. “I was closer to the Agency than Stew was, though Stew was very close. I dare say he did perform some tasks—he just did the correct thing as an American…. The Founding Fathers [of the CIA] were close personal friends of ours. Dick Bissell [former CIA deputy director] was my oldest friend, from childhood. It was a social thing, my dear fellow. I never received a dollar, I never signed a secrecy agreement. I didn’t have to…. I’ve done things for them when I thought they were the right thing to do. I call it doing my duty as a citizen.

Alsop is willing to discuss on the record only two of the tasks he undertook: a visit to Laos in 1952 at the behest of Frank Wisner, who felt other American reporters were using anti‑American sources about uprisings there; and a visit to the Phillipines in 1953 when the CIA thought his presence there might affect the outcome of an election. “Des FitzGerald urged me to go,” Alsop recalled. “It would be less likely that the election could be stolen [by the opponents of Ramon Magsaysay] if the eyes of the world were on them. I stayed with the ambassador and wrote about what happened.”

Alsop maintains that he was never manipulated by the Agency. “You can’t get entangled so they have leverage on you,” he said. “But what I wrote was true. My view was to get the facts. If someone in the Agency was wrong, I stopped talking to them—they’d given me phony goods.” On one occasion, Alsop said, Richard Helms authorized the head of the Agency’s analytical branch to provide Alsop with information on Soviet military presence along the Chinese border. “The analytical side of the Agency had been dead wrong about the war in Vietnam—they thought it couldn’t be won,” said Alsop. “And they were wrong on the Soviet buildup. I stopped talking to them.” Today, he says, “People in our business would be outraged at the kinds of suggestions that were made to me. They shouldn’t be. The CIA did not open itself at all to people it did not trust. Stew and I were trusted, and I’m proud of it.”

MURKY DETAILS OF CIA RELATIONSHIPS WITH INDIVIDUALS and news organizations began trickling out in 1973 when it was first disclosed that the CIA had, on occasion, employed journalists. Those reports, combined with new information, serve as casebook studies of the Agency’s use of journalists for intelligence purposes. They include:

The New York Times. The Agency’s relationship with the Times was by far its most valuable among newspapers, according to CIA officials. From 1950 to 1966, about ten CIA employees were provided Times cover under arrangements approved by the newspaper’s late publisher, Arthur Hays Sulzberger. The cover arrangements were part of a general Times policy—set by Sulzberger—to provide assistance to the CIA whenever possible.

Sulzberger was especially close to Allen Dulles. “At that level of contact it was the mighty talking to the mighty,” said a high‑level CIA official who was present at some of the discussions. “There was an agreement in principle that, yes indeed, we would help each other. The question of cover came up on several occasions.  It was agreed that the actual arrangements would be handled by subordinates…. The mighty didn’t want to know the specifics; they wanted plausible deniability.

A senior CIA official who reviewed a portion of the Agency’s files on journalists for two hours onSeptember 15th, 1977, said he found documentation of five instances in which the Times had provided cover for CIA employees between 1954 and 1962. In each instance he said, the arrangements were handled by executives of the Times; the documents all contained standard Agency language “showing that this had been checked out at higher levels of the New York Times,” said the official. The documents did not mention Sulzberger’s name, however—only those of subordinates whom the official refused to identify.

The CIA employees who received Times credentials posed as stringers for the paper abroad and worked as members of clerical staffs in the Times’ foreign bureaus. Most were American; two or three were foreigners.

CIA officials cite two reasons why the Agency’s working relationship with the Times was closer and more extensive than with any other paper: the fact that the Times maintained the largest foreign news operation in American daily journalism; and the close personal ties between the men who ran both institutions.

Sulzberger informed a number of reporters and editors of his general policy of cooperation with the Agency. “We were in touch with them—they’d talk to us and some cooperated,” said a CIA official. The cooperation usually involved passing on information and “spotting” prospective agents among foreigners.

Arthur Hays Sulzberger signed a secrecy agreement with the CIA in the 1950s, according to CIA officials—a fact confirmed by his nephew, C.L. Sulzberger. However, there are varying interpretations of the purpose of the agreement: C.L. Sulzberger says it represented nothing more than a pledge not to disclose classified information made available to the publisher. That contention is supported by some Agency officials. Others in the Agency maintain that the agreement represented a pledge never to reveal any of the Times’ dealings with the CIA, especially those involving cover. And there are those who note that, because all cover arrangements are classified, a secrecy agreement would automatically apply to them.

Attempts to find out which individuals in the Times organization made the actual arrangements for providing credentials to CIA personnel have been unsuccessful. In a letter to reporter Stuart Loory in 1974, Turner Cadedge, managing editor of the Times from 1951 to 1964, wrote that approaches by the CIA had been rebuffed by the newspaper. “I knew nothing about any involvement with the CIA… of any of our foreign correspondents on the New York Times. I heard many times of overtures to our men by the CIA, seeking to use their privileges, contacts, immunities and, shall we say, superior intelligence in the sordid business of spying and informing. If any one of them succumbed to the blandishments or cash offers, I was not aware of it. Repeatedly, the CIA and other hush‑hush agencies sought to make arrangements for ‘cooperation’ even with Times management, especially during or soon after World War II, but we always resisted. Our motive was to protect our credibility.”

According to Wayne Phillips, a former Timesreporter, the CIA invoked Arthur Hays Sulzberger’s name when it tried to recruit him as an undercover operative in 1952 while he was studying at Columbia University’s Russian Institute. Phillips said an Agency official told him that the CIA had “a working arrangement” with the publisher in which other reporters abroad had been placed on the Agency’s payroll. Phillips, who remained at the Times until 1961, later obtained CIA documents under the Freedom of Information Act which show that the Agency intended to develop him as a clandestine “asset” for use abroad.

On January 31st, 1976, the Times carried a brief story describing the ClAs attempt to recruit Phillips. It quoted Arthur Ochs Sulzberger, the present publisher, as follows: “I never heard of the Times being approached, either in my capacity as publisher or as the son of the late Mr. Sulzberger.” The Times story, written by John M. Crewdson, also reported that Arthur Hays Sulzberger told an unnamed former correspondent that he might he approached by the CIA after arriving at a new post abroad. Sulzberger told him that he was not “under any obligation to agree,” the story said and that the publisher himself would be “happier” if he refused to cooperate. “But he left it sort of up to me,” the Times quoted its former reporter as saying. “The message was if I really wanted to do that, okay, but he didn’t think it appropriate for a Times correspondent”

C.L. Sulzberger, in a telephone interview, said he had no knowledge of any CIA personnel using Times cover or of reporters for the paper working actively for the Agency. He was the paper’s chief of foreign service from 1944 to 1954 and expressed doubt that his uncle would have approved such arrangements. More typical of the late publisher, said  Sulzberger, was a promise made to Allen Dulles’ brother, John Foster, then secretary of state, that no Times staff member would be permitted to accept an invitation to visit the People’s Republic of China without John Foster Dulles’ consent. Such an invitation was extended to the publisher’s nephew in the 1950s; Arthur Sulzberger forbade him to accept it. “It was seventeen years before another Times correspondent was invited,” C.L. Sulzberger recalled.

■ The Columbia Broadcasting System. CBS was unquestionably the CIAs most valuable broadcasting asset. CBS President William Paley and Allen Dulles enjoyed an easy working and social relationship. Over the years, the network provided cover for CIA employees, including at least one well‑known foreign correspondent and several stringers; it supplied outtakes of newsfilm to the CIA3; established a formal channel of communication between the Washington bureau chief and the Agency; gave the Agency access to the CBS newsfilm library; and allowed reports by CBS correspondents to the Washington and New York newsrooms to be routinely monitored by the CIA. Once a year during the 1950s and early 1960s, CBS correspondents joined the CIA hierarchy for private dinners and briefings.

The details of the CBS‑CIA arrangements were worked out by subordinates of both Dulles and Paley. “The head of the company doesn’t want to know the fine points, nor does the director,” said a CIA official. “Both designate aides to work that out. It keeps them above the battle.” Dr. Frank Stanton, for 25 years president of the network, was aware of the general arrangements Paley made with Dulles—including those for cover, according to CIA officials. Stanton, in an interview last year, said he could not recall any cover arrangements.) But Paley’s designated contact for the Agency was Sig Mickelson, president of CBS News between 1954 and 1961. On one occasion, Mickelson has said, he complained to Stanton about having to use a pay telephone to call the CIA, and Stanton suggested he install a private line, bypassing the CBS switchboard, for the purpose. According to Mickelson, he did so. Mickelson is now president of Radio Free Europe and Radio Liberty, both of which were associated with the CIA for many years.

In 1976, CBS News president Richard Salant ordered an in‑house investigation of the network’s dealings with the CIA. Some of its findings were first disclosed by Robert Scheer in the Los Angeles Times.) But Salant’s report makes no mention of some of his own dealings with the Agency, which continued into the 1970s.

Many details about the CBS‑CIA relationship were found in Mickelson’s files by two investigators for Salant. Among the documents they found was a September 13th, 1957, memo to Mickelson fromTed Koop, CBS News bureau chief  in Washington from 1948 to 1961. It describes a phone call to Koop from Colonel Stanley Grogan of the CIA: “Grogan phoned to say that Reeves [J. B. Love Reeves, another CIA official] is going to New York to be in charge of the CIA contact office there and will call to see you and some of your confreres. Grogan says normal activities will continue to channel through the Washington office of CBS News.” The report to Salant also states: “Further investigation of Mickelson’s files reveals some details of the relationship between the CIA and CBS News…. Two key administrators of this relationship were Mickelson and Koop…. The main activity appeared to be the delivery of CBS newsfilm to the CIA…. In addition there is evidence that, during 1964 to 1971, film material, including some outtakes, were supplied by the CBS Newsfilm Library to the CIA through and at the direction of Mr. Koop4…. Notes in Mr. Mickelson’s files indicate that the CIA used CBS films for training… All of the above Mickelson activities were handled on a confidential basis without mentioning the words Central Intelligence Agency. The films were sent to individuals at post‑office box numbers and were paid for by individual, nor government, checks. …” Mickelson also regularly sent the CIA an internal CBS newsletter, according to the report.

Salant’s investigation led him to conclude that Frank Kearns, a CBS‑TV reporter from 1958 to 1971, “was a CIA guy who got on the payroll somehow through a CIA contact with somebody at CBS.” Kearns and Austin Goodrich, a CBS stringer, were undercover CIA employees, hired under arrangements approved by Paley.

Last year a spokesman for Paley denied a report by former CBS correspondent Daniel Schorr that Mickelson and he had discussed Goodrich’s CIA status during a meeting with two Agency representatives in 1954. The spokesman claimed Paley had no knowledge that Goodrich had worked for the CIA. “When I moved into the job I was told by Paley that there was an ongoing relationship with the CIA,” Mickelson said in a recent interview. “He introduced me to two agents who he said would keep in touch. We all discussed the Goodrich situation and film arrangements. I assumed this was a normal relationship at the time. This was at the height of the Cold War and I assumed the communications media were cooperating—though the Goodrich matter was compromising.

At the headquarters of CBS News in New York, Paley’s cooperation with the CIA is taken for granted by many news executives and reporters, despite tile denials. Paley, 76, was not interviewed by Salant’s investigators. “It wouldn’t do any good,” said one CBS executive. “It is the single subject about which his memory has failed.”

Salant discussed his own contacts with the CIA, and the fact he continued many of his predecessor’s practices, in an interview with this reporter last year. The contacts, he said, began in February 1961, “when I got a phone call from a CIA man who said he had a working relationship with Sig Mickelson. The man said, ‘Your bosses know all about it.’”  According to Salant, the CIA representative asked that CBS continue to supply the Agency with unedited newstapes and make its correspondents available for debriefingby Agency officials. Said Salant: “I said no on talking to the reporters, and let them see broadcast tapes, but no outtakes.  This went on for a number of years—into the early Seventies.”

In 1964 and 1965, Salant served on a super-secret CIA task force which explored methods of beaming American propaganda broadcasts to the People’s Republic of China. The other members of the four‑man study team were Zbigniew Brzezinski, then a professor at Columbia University; William Griffith, then professor of political science at the Massachusetts Institute of Technology., and John Haves, then vice‑president of the Washington Post Company for radio‑TV5. The principal government officials associated with the project were Cord Meyer of the CIA; McGeorge Bundy, then special assistant to the president for national security; Leonard Marks, then director of the USIA; and Bill Moyers, then special assistant to President Lyndon Johnson and now a CBS correspondent.

Salant’s involvement in the project began with a call from Leonard Marks, “who told me the White House wanted to form a committee of four people to make a study of U.S. overseas broadcasts behind the Iron Curtain.” When Salant arrived in Washington for the first meeting he was told that the project was CIA sponsored. “Its purpose,” he said, “was to determine how best to set up shortwave broadcasts into Red China.” Accompanied by a CIA officer named Paul Henzie, the committee of four subsequently traveled around the world inspecting facilities run by Radio Free Europe and Radio Liberty both CIA‑run operations at the time), the Voice of America and Armed Forces Radio. After more than a year of study, they submitted a report to Moyers recommending that the government establish a broadcast service, run by the Voice of America, to be beamed at the People’s Republic of China. Salant has served two tours as head of CBS News, from 1961‑64 and 1966‑present. At the time of the China project he was a CBS corporate executive.)

Time and Newsweek magazines. According to CIA and Senate sources, Agency files contain written agreements with former foreign correspondents and stringers for both the weekly news magazines.  The same sources refused to say whether the CIA has ended all its associations with individuals who work for the two publications. Allen Dulles often interceded with his good friend, the late Henry Luce, founder of Time and Life magazines, who readily allowed certain members of his staff to work for the Agency and agreed to provide jobs and credentials for other CIA operatives who lacked journalistic experience.

For many years, Luce’s personal emissary to the CIA was C.D. Jackson, a Time Inc., vice‑president who was publisher of Life magazine from 1960 until his death in 1964.While a Time executive, Jackson coauthored a CIA‑sponsored study recommending the reorganization of the American intelligence services in the early 1950s. Jackson, whose Time‑Life service was interrupted by a one‑year White House tour as an assistant to President Dwight Eisenhower, approved specific arrangements for providing CIA employees with Time‑Life cover. Some of these arrangements were made with the knowledge of Luce’s wife, Clare Boothe. Other arrangements for Time cover, according to CIA officials including those who dealt with Luce), were made with the knowledge of Hedley Donovan, now editor‑in‑chief of Time Inc. Donovan, who took over editorial direction of all Time Inc. publications in 1959, denied in a telephone interview that he knew of any such arrangements. “I was never approached and I’d be amazed if Luce approved such arrangements,” Donovan said. “Luce had a very scrupulous regard for the difference between journalism and government.”

In the 1950s and early 1960s, Time magazine’s foreign correspondents attended CIA “briefing” dinners similar to those the CIA held for CBS. And Luce, according to CIA officials, made it a regular practice to brief Dulles or other high Agency officials when he returned from his frequent trips abroad. Luce and the men who ran his magazines in the 1950s and 1960s encouraged their foreign correspondents to provide help to the CIA, particularly information that might be useful to the Agency for intelligence purposes or recruiting foreigners.

At Newsweek, Agency sources reported, the CIA engaged the services of’ several foreign correspondents and stringers under arrangements approved by senior editors at the magazine. Newsweek’s stringer in Rome in the mid‑Fifties made little secret of the fact that he worked for the CIA. Malcolm Muir, Newsweek’s editor from its founding in 1937 until its sale to the Washington Post Company in 1961, said in a recent interview that his dealings with the CIA were limited to private briefings he gave Allen Dulles after trips abroad and arrangements he approved for regular debriefing of Newsweek correspondents by the Agency. He said that he had never provided cover for CIA operatives, but that others high in the Newsweek organization might have done so without his knowledge.

“I would have thought there might have been stringers who were agents, but I didn’t know who they were,” said Muir. “I do think in those days the CIA kept pretty close touch with all responsible reporters. Whenever I heard something that I thought might be of interest to Allen Dulles, I’d call him up…. At one point he appointed one of his CIA men to keep in regular contact with our reporters, a chap that I knew but whose name I can’t remember. I had a number of friends in Alien Dulles’ organization.” Muir said that Harry Kern, Newsweek’s foreign editor from 1945 until 1956, and Ernest K. Lindley, the magazine’s Washington bureau chief during the same period “regularly checked in with various fellows in the CIA.”

“To the best of my knowledge.” said Kern, “nobody at Newsweek worked for the CIA… The informal relationship was there. Why have anybody sign anything? What we knew we told them [the CIA] and the State Department…. When I went to Washington, I would talk to Foster or Allen Dulles about what was going on. … We thought it was admirable at the time. We were all on the same side.” CIA officials say that Kern’s dealings with the Agency were extensive. In 1956, he left Newsweek to run Foreign Reports, a Washington‑based newsletter whose subscribers Kern refuses to identify.

Ernest Lindley, who remained at Newsweek until 1961, said in a recent interview that he regularly consulted with Dulles and other high CIA officials before going abroad and briefed them upon his return. “Allen was very helpful to me and I tried to reciprocate when I could,” he said. “I’d give him my impressions of people I’d met overseas. Once or twice he asked me to brief a large group of intelligence people; when I came back from the Asian‑African conference in 1955, for example; they mainly wanted to know about various people.”

As Washington bureau chief, Lindley said he learned from Malcolm Muir that the magazine’s stringer in southeastern Europe was a CIA contract employee—given credentials under arrangements worked out with the management. “I remember it came up—whether it was a good idea to keep this person from the Agency; eventually it was decided to discontinue the association,” Lindley said.

When Newsweek waspurchased by the Washington Post Company, publisher Philip L. Graham was informed by Agency officials that the CIA occasionally used the magazine for cover purposes, according to CIA sources. “It was widely known that Phil Graham was somebody you could get help from,” said a former deputy director of the Agency. “Frank Wisner dealt with him.” Wisner, deputy director of the CIA from 1950 until shortly before his suicide in 1965, was the Agency’s premier orchestrator of “black” operations, including many in which journalists were involved. Wisner liked to boast of his “mighty Wurlitzer,” a wondrous propaganda instrument he built, and played, with help from the press.) Phil Graham was probably Wisner’s closest friend. But Graharn, who committed suicide in 1963, apparently knew little of the specifics of any cover arrangements with Newsweek, CIA sources said.

In 1965‑66, an accredited Newsweek stringer in the Far East was in fact a CIA contract employee earning an annual salary of $10,000 from the Agency, according to Robert T. Wood, then a CIA officer in the Hong Kong station. Some, Newsweek correspondents and stringers continued to maintain covert ties with the Agency into the 1970s, CIA sources said.

Information about Agency dealings with the Washington Post newspaper is extremely sketchy. According to CIA officials, some Post stringers have been CIA employees, but these officials say they do not know if anyone in the Post management was aware of the arrangements.

All editors‑in‑chief and managing editors of the Post since 1950 say they knew of no formal Agency relationship with either stringers or members of the Post staff. “If anything was done it was done by Phil without our knowledge,” said one. Agency officials, meanwhile, make no claim that Post staff members have had covert affiliations with the Agency while working for the paper.6

Katharine Graham, Philip Graham’s widow and the current publisher of the Post, says she has never been informed of any CIA relationships with either Post or Newsweek personnel. In November of 1973, Mrs. Graham called William Colby and asked if any Post stringers or staff members were associated with the CIA. Colby assured her that no staff members were employed by the Agency but refused to discuss the question of stringers.

■ The Louisville Courier‑Journal. From December 1964 until March 1965, a CIA undercover operative named Robert H. Campbell worked on the Courier‑Journal. According to high‑level CIA sources, Campbell was hired by the paper under arrangements the Agency made with Norman E. Isaacs, then executive editor of the Courier‑Journal. Barry Bingham Sr., then publisher of the paper, also had knowledge of the arrangements, the sources said. Both Isaacs and Bingham have denied knowing that Campbell was an intelligence agent when he was hired.

The complex saga of Campbell’s hiring was first revealed in a Courier‑Journal story written by James R Herzog on March 27th, 1976, during the Senate committee’s investigation, Herzog’s account began: “When 28‑year‑old Robert H. Campbell was hired as a Courier‑Journal reporter in December 1964, he couldn’t type and knew little about news writing.” The account then quoted the paper’s former managing editor as saying that Isaacs told him that Campbell was hired as a result of a CIA request: “Norman said, when he was in Washington [in 1964], he had been called to lunch with some friend of his who was with the CIA [and that] he wanted to send this young fellow down to get him a little knowledge of newspapering.” All aspects of Campbell’s hiring were highly unusual. No effort had been made to check his credentials, and his employment records contained the following two notations: “Isaacs has files of correspondence and investigation of this man”; and, “Hired for temporary work—no reference checks completed or needed.”

The level of Campbell’s journalistic abilities apparently remained consistent during his stint at the paper, “The stuff that Campbell turned in was almost unreadable,” said a former assistant city editor. One of Campbell’s major reportorial projects was a feature about wooden Indians. It was never published. During his tenure at the paper, Campbell frequented a bar a few steps from the office where, on occasion, he reportedly confided to fellow drinkers that he was a CIA employee.

According to CIA sources, Campbell’s tour at the Courier‑Journal was arranged to provide him with a record of journalistic experience that would enhance the plausibility of future reportorial cover and teach him something about the newspaper business. The Courier‑Journal’s investigation also turned up the fact that before coming to Louisville he had worked briefly for the Hornell, New York, Evening Tribune, published by Freedom News, Inc. CIA sources said the Agency had made arrangements with that paper’s management to employ Campbell.7

At the Courier‑Journal, Campbell was hired under arrangements made with Isaacs and approved by Bingham, said CIA and Senate sources. “We paid the Courier‑Journal so they could pay his salary,” said an Agency official who was involved in the transaction. Responding by letter to these assertions, Isaacs, who left Louisville to become president and publisher of the Wilmington Delaware) News & Journal, said: “All I can do is repeat the simple truth—that never, under any circumstances, or at any time, have I ever knowingly hired a government agent. I’ve also tried to dredge my memory, but Campbell’s hiring meant so little to me that nothing emerges…. None of this is to say that I couldn’t have been ‘had.’”.Barry Bingham Sr., said last year in a telephone interview that he had no specific memory of Campbell’s hiring and denied that he knew of any arrangements between the newspaper’s management and the CIA. However, CIA officials said that the Courier‑Journal, through contacts with Bingham, provided other unspecified assistance to the Agency in the 1950s and 1960s. The Courier‑Journal’s detailed, front‑page account of Campbell’s hiring was initiated by Barry Bingham Jr., who succeeded his father as editor and publisher of the paper in 1971. The article is the only major piece of self‑investigation by a newspaper that has appeared on this subject.8

■ The American Broadcasting Company and the National Broadcasting Company. According to CIA officials, ABC continued to provide cover for some CIA operatives through the 1960s. One was Sam Jaffe who CIA officials said performed clandestine tasks for the Agency. Jaffe has acknowledged only providing the CIA with information. In addition, another well‑known network correspondent performed covert tasks for the Agency, said CIA sources. At the time of the Senate bearings, Agency officials serving at the highest levels refused to say whether the CIA was still maintaining active relationships with members of the ABC‑News organization. All cover arrangements were made with the knowledge off ABC executives, the sources said.

These same sources professed to know few specifies about the Agency’s relationships with NBC, except that several foreign correspondents of the network undertook some assignments for the Agency in the 1950s and 1960s. “It was a thing people did then,” said Richard Wald, president of NBC News since 1973. “I wouldn’t be surprised if people here—including some of the correspondents in those days—had connections with the Agency.”

■ The Copley Press, and its subsidiary, the Copley News Service. This relationship, first disclosed publicly by reporters Joe Trento and Dave Roman in Penthouse magazine, is said by CIA officials to have been among the Agency’s most productive in terms of getting “outside” cover for its employees. Copley owns nine newspapers in California and Illinois—among them the San Diego Union and Evening Tribune. The Trento‑Roman account, which was financed by a grant from the Fund for Investigative Journalism, asserted that at least twenty‑three Copley News Service employees performed work for the CIA. “The Agency’s involvement with the Copley organization is so extensive that it’s almost impossible to sort out,” said a CIA official who was asked about the relationship late in 1976. Other Agency officials said then that James S. Copley, the chain’s owner until his death in 1973, personally made most of the cover arrangements with the CIA.

According to Trento and Roman, Copley personally volunteered his news service to then‑president Eisenhower to act as “the eyes and ears” against “the Communist threat in Latin and Central America” for “our intelligence services.”  James Copley was also the guiding hand behind the Inter‑American Press Association, a CIA‑funded organization with heavy membership among right‑wing Latin American newspaper editors.

■ Other major news organizations. According to Agency officials, CIA files document additional cover arrangements with the following news‑gathering organizations, among others: the New York Herald‑Tribune, the Saturday‑Evening Post, Scripps‑Howard Newspapers, Hearst Newspapers Seymour K. Freidin, Hearst’s current London bureau chief and a former Herald‑Tribune editor and correspondent, has been identified as a CIA operative by Agency sources), Associated Press,9 United Press International, the Mutual Broadcasting System, Reuters and the Miami Herald. Cover arrangements with the Herald, according to CIA officials, were unusual in that they were made “on the ground by the CIA station in Miami, not from CIA headquarters.

“And that’s just a small part of the list,” in the words of one official who served in the CIA hierarchy. Like many sources, this official said that the only way to end the uncertainties about aid furnished the Agency by journalists is to disclose the contents of the CIA files—a course opposed by almost all of the thirty‑five present and former CIA officials interviewed over the course of a year.

COLBY CUTS HIS LOSSES

THE CIA’S USE OF JOURNALISTS CONTINUED VIRTUALLY unabated until 1973 when, in response to public disclosure that the Agency had secretly employed American reporters, William Colby began scaling down the program. In his public statements, Colby conveyed the impression that the use of journalists had been minimal and of limited importance to the Agency.

He then initiated a series of moves intended to convince the press, Congress and the public that the CIA had gotten out of the news business. But according to Agency officials, Colby had in fact thrown a protective net around his valuable intelligence in the journalistic community. He ordered his deputies to maintain Agency ties with its best journalist contacts while severing formal relationships with many regarded as inactive, relatively unproductive or only marginally important. In reviewing Agency files to comply with Colby’s directive, officials found that many journalists had not performed useful functions for the CIA in years. Such relationships, perhaps as many as a hundred, were terminated between 1973 and 1976.

Meanwhile, important CIA operatives who had been placed on the staffs of some major newspaper and broadcast outlets were told to resign and become stringers or freelancers, thus enabling Colby to assure concerned editors that members of their staffs were not CIA employees. Colby also feared that some valuable stringer‑operatives might find their covers blown if scrutiny of the Agency’s ties with journalists continued. Some of these individuals were reassigned to jobs on so‑called proprietary publications—foreign periodicals and broadcast outlets secretly funded and staffed by the CIA. Other journalists who had signed formal contracts with the CIA—making them employees of the Agency—were released from their contracts, and asked to continue working under less formal arrangements.

In November 1973, after many such shifts had been made, Colby told reporters and editors from the New York Times and the Washington Star that the Agency had “some three dozen” American newsmen “on the CIA payroll,” including five who worked for “general‑circulation news organizations.” Yet even while the Senate Intelligence Committee was holding its hearings in 1976, according to high‑level CIA sources, the CIA continued to maintain ties with seventy‑five to ninety journalists of every description—executives, reporters, stringers, photographers, columnists, bureau clerks and members of broadcast technical crews. More than half of these had been moved off CIA contracts and payrolls but they were still bound by other secret agreements with the Agency. According to an unpublished report by the House Select Committee on Intelligence, chaired by Representative Otis Pike, at least fifteen news organizations were still providing cover for CIA operatives as of 1976.

Colby, who built a reputation as one of the most skilled undercover tacticians in the CIA’s history, had himself run journalists in clandestine operations before becoming director in 1973. But even he was said by his closest associates to have been disturbed at how extensively and, in his view, indiscriminately, the Agency continued to use journalists at the time he took over. “Too prominent,” the director frequently said of some of the individuals and news organizations then working with the CIA. Others in the Agency refer to their best‑known journalistic assets as “brand names.”)

“Colby’s concern was that he might lose the resource altogether unless we became a little more careful about who we used and how we got them,” explained one of the former director’s deputies. The thrust of Colby’s subsequent actions was to move the Agency’s affiliations away from the so‑called “majors” and to concentrate them instead in smaller newspaper chains, broadcasting groups and such specialized publications as trade journals and newsletters.

After Colby left the Agency on January 28th, 1976, and was succeeded by George Bush, the CIA announced a new policy: “Effective immediately, the CIA will not enter into any paid or contractual relationship with any full‑time or part‑time news correspondent accredited by any U.S. news service, newspaper, periodical, radio or television network or station” At the time of the announcement, the Agency acknowledged that the policy would result in termination of less than half of the relationships with the 50 U.S. journalists it said were still affiliated with the Agency. The text of the announcement noted that the CIA would continue to “welcome” the voluntary, unpaid cooperation of journalists. Thus, many relationships were permitted to remain intact.

The Agency’s unwillingness to end its use of journalists and its continued relationships with some news executives is largely the product of two basic facts of the intelligence game: journalistic cover is ideal because of the inquisitive nature of a reporter’s job; and many other sources of institutional cover have been denied the CIA in recent years by businesses, foundations and educational institutions that once cooperated with the Agency.

“It’s tough to run a secret agency in this country,” explained one high‑level CIA official. “We have a curious ambivalence about intelligence. In order to serve overseas we need cover. But we have been fighting a rear‑guard action to try and provide cover. The Peace Corps is off‑limits, so is USIA, the foundations and voluntary organizations have been off‑limits since ‘67, and there is a self‑imposed prohibition on Fulbrights [Fulbright Scholars]. If you take the American community and line up who could work for the CIA and who couldn’t there is a very narrow potential. Even the Foreign Service doesn’t want us. So where the hell do you go? Business is nice, but the press is a natural. One journalist is worth twenty agents. He has access, the ability to ask questions without arousing suspicion.”

ROLE OF THE CHURCH COMMITTEE

DESPITE THE EVIDENCE OF WIDESPREAD CIA USE OF journalists, the Senate Intelligence Committee and its staff decided against questioning any of the reporters, editors, publishers or broadcast executives whose relationships with the Agency are detailed in CIA files.

According to sources in the Senate and the Agency, the use of journalists was one of two areas of inquiry which the CIA went to extraordinary lengths to curtail. The other was the Agency’s continuing and extensive use of academics for recruitment and information gathering purposes.

In both instances, the sources said, former directors Colby and Bush and CIA special counsel Mitchell Rogovin were able to convince key members of the committee that full inquiry or even limited public disclosure of the dimensions of the activities would do irreparable damage to the nation’s intelligence‑gathering apparatus, as well as to the reputations of hundreds of individuals. Colby was reported to have been especially persuasive in arguing that disclosure would bring on a latter‑day “witch hunt” in which the victims would be reporters, publishers and editors.

Walter Elder, deputy to former CIA director McCone and the principal Agency liaison to the Church committee, argued that the committee lacked jurisdiction because there had been no misuse of journalists by the CIA; the relationships had been voluntary. Elder cited as an example the case of the Louisville Courier‑Journal. “Church and other people on the committee were on the chandelier about the Courier‑Journal,” one Agency official said, “until we pointed out that we had gone to the editor to arrange cover, and that the editor had said, ‘Fine.’”

Some members of the Church committee and staff feared that Agency officials had gained control of the inquiry and that they were being hoodwinked. “The Agency was extremely clever about it and the committee played right into its hands,” said one congressional source familiar with all aspects of the inquiry. “Church and some of the other members were much more interested in making headlines than in doing serious, tough investigating. The Agency pretended to be giving up a lot whenever it was asked about the flashy stuff—assassinations and secret weapons and James Bond operations. Then, when it came to things that they didn’t want to give away, that were much more important to the Agency, Colby in particular called in his chits. And the committee bought it.”

The Senate committee’s investigation into the use of journalists was supervised by William B. Bader, a former CIA intelligence officer who returned briefly to the Agency this year as deputy to CIA director Stansfield Turner and is now a high‑level intelligence official at the Defense Department. Bader was assisted by David Aaron, who now serves as the deputy to Zbigniew Brzezinski, President Carter’s national security adviser.

According to colleagues on the staff of the Senate inquiry, both Bader and Aaron were disturbed by the information contained in CIA files about journalists; they urged that further investigation he undertaken by the Senate’s new permanent CIA oversight committee. That committee, however, has spent its first year of existence writing a new charter for the CIA, and members say there has been little interest in delving further into the CIA’s use of the press.

Bader’s investigation was conducted under unusually difficult conditions. His first request for specific information on the use of journalists was turned down by the CIA on grounds that there had been no abuse of authority and that current intelligence operations might he compromised. Senators Walter Huddleston, Howard Baker, Gary Hart, Walter Mondale and Charles Mathias—who had expressed interest in the subject of the press and the CIA—shared Bader’s distress at the CIA’s reaction. In a series of phone calls and meetings with CIA director George Bush and other Agency officials, the senators insisted that the committee staff be provided information about the scope of CIA‑press activities. Finally, Bush agreed to order a search of the files and have those records pulled which deals with operations where journalists had been used. But the raw files could not he made available to Bader or the committee, Bush insisted. Instead, the director decided, his deputies would condense the material into one‑paragraph sum­maries describing in the most general terms the activities of each individual journalist. Most important, Bush decreed, the names of journalists and of the news organizations with which they were affiliated would be omitted from the summaries. However, there might be some indication of the region where the journalist had served and a general description of the type of news organization for which he worked.

Assembling the summaries was difficult, according to CIA officials who supervised the job. There were no “journalist files” per se and information had to be collected from divergent sources that reflect the highly compartmentalized character of the CIA. Case officers who had handled journalists supplied some names. Files were pulled on various undercover operations in which it seemed logical that journalists had been used. Significantly, all work by reporters for the Agency under the category of covert operations, not foreign intelligence.) Old station records were culled. “We really had to scramble,” said one official.

After several weeks, Bader began receiving the summaries, which numbered over 400 by the time the Agency said it had completed searching its files.

The Agency played an intriguing numbers game with the committee. Those who prepared the material say it was physically impossible to produce all of the Agency’s files on the use of journalists. “We gave them a broad, representative picture,” said one agency official. “We never pretended it was a total description of the range of activities over 25 years, or of the number of journalists who have done things for us.” A relatively small number of the summaries described the activities of foreign journalists—including those working as stringers for American publications. Those officials most knowledgeable about the subject say that a figure of 400 American journalists is on the low side of the actual number who maintained covert relationships and undertook clandestine tasks.

Bader and others to whom he described the contents of the summaries immediately reached some general conclusions: the sheer number of covert relationships with journalists was far greater than the CIA had ever hinted; and the Agency’s use of reporters and news executives was an intelligence asset of the first magnitude. Reporters had been involved in almost every conceivable kind of operation. Of the 400‑plus individuals whose activities were summarized, between 200 and 250 were “working journalists” in the usual sense of the term—reporters, editors, correspondents, photographers; the rest were employed at least nominally) by book publishers, trade publications and newsletters.

Still, the summaries were just that: compressed, vague, sketchy, incomplete. They could be subject to ambiguous interpretation. And they contained no suggestion that the CIA had abused its authority by manipulating the editorial content of American newspapers or broadcast reports.

Bader’s unease with what he had found led him to seek advice from several experienced hands in the fields of foreign relations and intelligence. They suggested that he press for more information and give those members of the committee in whom he had the most confidence a general idea of what the summaries revealed. Bader again went to Senators Huddleston, Baker, Hart, Mondale and Mathias. Meanwhile, he told the CIA that he wanted to see more—the full files on perhaps a hundred or so of the individuals whose activities had been summarized. The request was turned down outright. The Agency would provide no more information on the subject. Period.

The CIA’s intransigence led to an extraordinary dinner meeting at Agency headquarters in late March 1976. Those present included Senators Frank Church who had now been briefed by Bader), and John Tower, the vice‑chairman of the committee; Bader; William Miller, director of the committee staff; CIA director Bush; Agency counsel Rogovin; and Seymour Bolten, a high‑level CIA operative who for years had been a station chief in Germany and Willy Brandt’s case officer. Bolten had been deputized by Bush to deal with the committee’s requests for information on journalists and academics. At the dinner, the Agency held to its refusal to provide any full files. Nor would it give the committee the names of any individual journalists described in the 400 summaries or of the news organizations with whom they were affiliated. The discussion, according to participants, grew heated. The committee’s representatives said they could not honor their mandate—to determine if the CIA had abused its authority—without further information. The CIA maintained it could not protect its legitimate intelligence operations or its employees if further disclosures were made to the committee. Many of the journalists were contract employees of the Agency, Bush said at one point, and the CIA was no less obligated to them than to any other agents.

Finally, a highly unusual agreement was hammered out: Bader and Miller would be permitted to examine “sanitized” versions of the full files of twenty‑five journalists selected from the summaries; but the names of the journalists and the news organizations which employed them would be blanked out, as would the identities of other CIA employees mentioned in the files. Church and Tower would be permitted to examine the unsanitizedversions of five of the twenty‑five files—to attest that the CIA was not hiding anything except the names. The whole deal was contingent on an agreement that neither Bader, Miner, Tower nor Church would reveal the contents of the files to other members of the committee or staff.

Bader began reviewing the 400‑some summaries again. His object was to select twenty‑five that, on the basis of the sketchy information they contained, seemed to represent a cross section. Dates of CIA activity, general descriptions of news organizations, types of journalists and undercover operations all figured in his calculations.

From the twenty‑five files he got back, according to Senate sources and CIA officials, an unavoidable conclusion emerged: that to a degree never widely suspected, the CIA in the 1950s, ‘60s and even early ‘70s had concentrated its relationships with journalists in the most prominent sectors of the American press corps, including four or five of the largest newspapers in the country, the broadcast networks and the two major newsweekly magazines. Despite the omission of names and affiliations from the twenty‑five detailed files each was between three and eleven inches thick), the information was usually sufficient to tentatively identify either the newsman, his affiliation or both—particularly because so many of them were prominent in the profession.

“There is quite an incredible spread of relationships,” Bader reported to the senators. “You don’t need to manipulate Time magazine, for example, because there are Agency people at the management level.”

Ironically, one major news organization that set limits on its dealings with the CIA, according to Agency officials, was the one with perhaps the greatest editorial affinity for the Agency’s long‑range goals and policies: U.S. News and World Report. The late David Lawrence, the columnist and founding editor of U.S. News, was a close friend of Allen Dulles. But he repeatedly refused requests by the CIA director to use the magazine for cover purposes, the sources said. At one point, according to a high CIA official, Lawrence issued orders to his sub‑editors in which he threatened to fire any U.S. News employee who was found to have entered into a formal relationship with the Agency. Former editorial executives at the magazine confirmed that such orders had been issued. CIA sources declined to say, however, if the magazine remained off‑limits to the Agency after Lawrence’s death in 1973 or if Lawrence’s orders had been followed.)

Meanwhile, Bader attempted to get more information from the CIA, particularly about the Agency’s current relationships with journalists. He encountered a stone wall. “Bush has done nothing to date,” Bader told associates. “None of the important operations are affected in even a marginal way.” The CIA also refused the staffs requests for more information on the use of academics. Bush began to urge members of the committee to curtail its inquiries in both areas and conceal its findings in the final report. “He kept saying, ‘Don’t fuck these guys in the press and on the campuses,’ pleading that they were the only areas of public life with any credibility left,” reported a Senate source. Colby, Elder and Rogovin also implored individual members of the committee to keep secret what the staff had found. “There were a lot of representations that if this stuff got out some of the biggest names in journalism would get smeared,” said another source. Exposure of the CIA’s relationships with journalists and academics, the Agency feared, would close down two of the few avenues of agent recruitment still open. “The danger of exposure is not the other side,” explained one CIA expert in covert operations. “This is not stuff the other side doesn’t know about. The concern of the Agency is that another area of cover will be denied.”

A senator who was the object of the Agency’s lobbying later said: “From the CIA point of view this was the highest, most sensitive covert program of all…. It was a much larger part of the operational system than has been indicated.” He added, “I had a great compulsion to press the point but it was late …. If we had demanded, they would have gone the legal route to fight it.”

Indeed, time was running out for the committee. In the view of many staff members, it had squandered its resources in the search for CIA assassination plots and poison pen letters. It had undertaken the inquiry into journalists almost as an afterthought. The dimensions of the program and the CIA’s sensitivity to providing information on it had caught the staff and the committee by surprise. The CIA oversight committee that would succeed the Church panel would have the inclination and the time to inquire into the subject methodically; if, as seemed likely, the CIA refused to cooperate further, the mandate of the successor committee would put it in a more advantageous position to wage a protracted fight …. Or so the reasoning went as Church and the few other senators even vaguely familiar with Bader’s findings reached a decision not to pursue the matter further. No journalists would be interviewed about their dealings with the Agency—either by the staff or by the senators, in secret or in open session. The specter, first raised by CIA officials, of a witch hunt in the press corps haunted some members of the staff and the committee. “We weren’t about to bring up guys to the committee and then have everybody say they’ve been traitors to the ideals of their profession,” said a senator.

Bader, according to associates, was satisfied with the decision and believed that the successor committee would pick up the inquiry where he had left it. He was opposed to making public the names of individual journalists. He had been concerned all along that he had entered a “gray area” in which there were no moral absolutes. Had the CIA “manipulated” the press in the classic sense of the term? Probably not, he concluded; the major news organizations and their executives had willingly lent their resources to the Agency; foreign correspondents had regarded work for the CIA as a national service and a way of getting better stories and climbing to the top of their profession. Had the CIA abused its authority? It had dealt with the press almost exactly as it had dealt with other institutions from which it sought cover — the diplomatic service, academia, corporations. There was nothing in the CIA’s charter which declared any of these institutions off‑limits to America’s intelligence service. And, in the case of the press, the Agency had exercised more care in its dealings than with many other institutions; it had gone to considerable lengths to restrict its role to information‑gathering and cover.10

Bader was also said to be concerned that his knowledge was so heavily based on information furnished by the CIA; he hadn’t gotten the other side of the story from those journalists who had associated with the Agency. He could be seeing only “the lantern show,” he told associates. Still, Bader was reasonably sure that he had seen pretty much the full panoply of what was in the files. If the CIA had wanted to deceive him it would have never given away so much, he reasoned. “It was smart of the Agency to cooperate to the extent of showing the material to Bader,” observed a committee source. “That way, if one fine day a file popped up, the Agency would be covered. They could say they had already informed the Congress.”

The dependence on CIA files posed another problem. The CIA’s perception of a relationship with a journalist might be quite different than that of the journalist: a CIA official might think he had exercised control over a journalist; the journalist might think he had simply had a few drinks with a spook. It was possible that CIA case officers had written self‑serving memos for the files about their dealings with journalists, that the CIA was just as subject to common bureaucratic “cover‑your‑ass” paperwork as any other agency of government.

A CIA official who attempted to persuade members of the Senate committee that the Agency’s use of journalists had been innocuous maintained that the files were indeed filled with “puffing” by case officers. “You can’t establish what is puff and what isn’t,” he claimed. Many reporters, he added, “were recruited for finite [specific] undertakings and would be appalled to find that they were listed [in Agency files] as CIA operatives.” This same official estimated that the files contained descriptions of about half a dozen reporters and correspondents who would be considered “famous”—that is, their names would be recognized by most Americans. “The files show that the CIA goes to the press for and just as often that the press comes to the CIA,” he observed. “…There is a tacit agreement in many of these cases that there is going to be a quid pro quo”—i.e., that the reporter is going to get good stories from the Agency and that the CIA will pick up some valuable services from the reporter.

Whatever the interpretation, the findings of the Senate committees inquiry into the use of journalists were deliberately buried—from the full membership of the committee, from the Senate and from the public. “There was a difference of opinion on how to treat the subject,” explained one source. “Some [senators] thought these were abuses which should be exorcized and there were those who said, ‘We don’t know if this is bad or not.’”

Bader’s findings on the subject were never discussed with the full committee, even in executive session. That might have led to leaks—especially in view of the explosive nature of the facts. Since the beginning of the Church committee’s investigation, leaks had been the panel’s biggest collective fear, a real threat to its mission. At the slightest sign of a leak the CIA might cut off the flow of sensitive information as it did, several times in other areas), claiming that the committee could not be trusted with secrets. “It was as if we were on trial—not the CIA,” said a member of the committee staff. To describe in the committee’s final report the true dimensions of the Agency’s use of journalists would cause a furor in the press and on the Senate floor. And it would result in heavy pressure on the CIA to end its use of journalists altogether. “We just weren’t ready to take that step,” said a senator. A similar decision was made to conceal the results of the staff’s inquiry into the use of academics. Bader, who supervised both areas of inquiry, concurred in the decisions and drafted those sections of the committee’s final report. Pages 191 to 201 were entitled “Covert Relationships with the United States Media.” “It hardly reflects what we found,” stated Senator Gary Hart. “There was a prolonged and elaborate negotiation [with the CIA] over what would be said.”

Obscuring the facts was relatively simple. No mention was made of the 400 summaries or what they showed. Instead the report noted blandly that some fifty recent contacts with journalists had been studied by the committee staff—thus conveying the impression that the Agency’s dealings with the press had been limited to those instances. The Agency files, the report noted, contained little evidence that the editorial content of American news reports had been affected by the CIA’s dealings with journalists. Colby’s misleading public statements about the use of journalists were repeated without serious contradiction or elaboration. The role of cooperating news executives was given short shrift. The fact that the Agency had concentrated its relationships in the most prominent sectors of the press went unmentioned. That the CIA continued to regard the press as up for grabs was not even suggested.

Former ‘Washington Post’ reporter CARL BERNSTEIN is now working on a book about the witch hunts of the Cold War.

Footnotes:

1 John McCone, director of the Agency from 1961 to 1965, said in a recent interview that he knew about “great deal of debriefing and exchanging help” but nothing about any arrangements for cover the CIA might have made with media organizations. “I wouldn’t necessarily have known about it,” he said. “Helms would have handled anything like that. It would be unusual for him to come to me and say, ‘We’re going to use journalists for cover.’ He had a job to do. There was no policy during my period that would say, ‘Don’t go near that water,’ nor was there one saying, ‘Go to it!’” During the Church committee bearings, McCone testified that his subordinates failed to tell him about domestic surveillance activities or that they were working on plans to assassinate Fidel Castro. Richard Helms was deputy director of the Agency at the time; he became director in 1966.

2 A stringer is a reporter who works for one or several news organizations on a retainer or on a piecework basis.

3 From the CIA point of view, access to newsfilm outtakes and photo libraries is a matter of extreme importance. The Agency’s photo archive is probably the greatest on earth; its graphic sources include satellites, photoreconnaissance, planes, miniature cameras and the American press. During the 1950s and 1960s, the Agency obtained carte‑blanche borrowing privileges in the photo libraries of literally dozens of American newspapers, magazines and television, outlets. For obvious reasons, the CIA also assigned high priority to the recruitment of photojournalists, particularly foreign‑based members of network camera crews.

4 On April 3rd, 1961, Koop left the Washington bureau to become head of CBS, Inc.’s Government Relations Department — a position he held until his retirement on March 31st, 1972.  Koop, who worked as a deputy in the Censorship Office in World War II, continued to deal with the CIA in his new position, according to CBS sources.

5 Hayes, who left the Washington Post Company in 1965 to become U.S. Ambassador to Switzerland, is now chairman of the board of Radio Free Europe and Radio Liberty — both of which severed their ties with the CIA in 1971.  Hayes said he cleared his participation in the China project with the late Frederick S. Beebe, then chairman of the board of the Washington Post Company.  Katharine Graham, the Post’s publisher, was unaware of the nature of the assignment, he said.  Participants in the project signed secrecy agreements.

6 Philip Geyelin, editor of the Post editorial page, worked for the Agency before joining the Post.

7 Louis Buisch, presidentof the publishing company of the Hornell, New York, Evening Tribune, told the Courier‑Journal in 1976 that he remembered little about the hiring of Robert Campbell. “He wasn’t there very long, and he didn’t make much of an impression,” said Buisch, who has since retired from active management of the newspaper.

8 Probably the most thoughtful article on the subject of the press and the CIA was written by Stuart H. Loory and appeared in the September‑October 1974 issue of Columbia Journalism Review.

9 Wes Gallagher, general manager of the Associated Press from 1962 to 1976, takes vigorous exception to the notion that the Associated Press might have aided the Agency. “We’ve always stayed clear on the CIA; I would have fired anybody who worked for them. We don’t even let our people debrief.” At the time of the first disclosures that reporters had worked for the CIA, Gallagher went to Colby. “We tried to find out names. All he would say was that no full‑time staff member of the Associated Press was employed by the Agency. We talked to Bush. He said the same thing.” If any Agency personnel were placed in Associated Press bureaus, said Gallagher, it was done without consulting the management of the wire service. But Agency officials insist that they were able to make cover arrangements through someone in the upper management levelsof Associated Press, whom they refuse to identify.

10 Many journalists and some CIA officials dispute the Agency’s claim that it has been scrupulous in respecting the editorial integrity of American publications and broadcast outlets.


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Video: Aldous Huxley Interviewed by Mike Wallace (1958)

August 17th, 2010 Comments off

The prophetic Aldous Huxley, social critic and author of Brave New World, talks to Mike Wallace about threats to freedom in the United States, overpopulation, bureaucracy, propaganda, drugs, advertising and television.

Bonus interesting tidbit…

On 21 October 1949, Huxley wrote to George Orwell, author of Nineteen Eighty-Four, congratulating Orwell on “how fine and how profoundly important the book is”. In his letter to Orwell, he predicted:

“Within the next generation I believe that the world’s leaders will discover that infant conditioning and narco-hypnosis are more efficient, as instruments of government, than clubs and prisons, and that the lust for power can be just as completely satisfied by suggesting people into loving their servitude as by flogging them and kicking them into obedience.”

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Remembering ‘The Advisory Committee on Human Radiation Experiments’ (1994)

August 16th, 2010 1 comment

From The U.S. Government Office of Health, Safety and Security (HSS)

On January 15, 1994, President Clinton appointed the Advisory Committee on Human Radiation Experiments. The President created the Committee to investigate reports of possibly unethical experiments funded by the government decades ago.

At our first meeting, we immediately realized that we were embarking on an intense and challenging investigation of an important aspect of our nation’s past and present, a task that required new insights and difficult judgments about ethical ques tions that persist even today.

We were granted unprecedented access to government documents. The President directed all the federal agencies involved to make available to the Committee any documents that might further our inquiry, wherever they might be located and whether or not they were still secret.

As we began our search into the past, we quickly discovered that it was going to be extremely difficult to piece together a coherent picture. Many critical documents had long since been forgotten and were stored in obscure locations throughout the country. Often they were buried in collections that bore no obvious connection to human radiation experiments. There was no easy way to identify how many experiments had been conducted, where they took place, and which government agencies had sponsored them. Nor was there a quick way to learn what rules applied to these experiments for the period prior to the mid-1960s. With the assistance of hundreds of federal officials and agency staff, the Committee retrieved and reviewed hundreds of thousands of government documents. Some of the most important documents were secret and were declassified at our request. Even after this extraordinary effort, the historical record remains incomplete. Some potentially important collections could not be located and were evidently lost or destroyed years ago.

Nevertheless, the documents that were recovered enabled us to identify nearly 4,000 human radiation experiments sponsored by the federal government between 1944 and 1974.

Between April 1994 and July 1995, the Advisory Committee held sixteen public meetings, most in Washington, D.C. In addition, subsets of Committee members presided over public forums in cities throughout the country. The Committee heard from more than 200 witnesses and interviewed dozens of profes sionals who were familiar with experiments involving radiation. A special effort, called the Ethics Oral History Project, was under taken to learn from eminent physicians about how research with human subjects was conducted in the l940s and 1950s.

The members of the Advisory Committee were fourteen private citizens from around the country: a representative of the general public and thirteen experts in bioethics, radiation oncology and biology, nuclear medicine, epidemiology and biostatistics, public health, history of science and medicine, and law.

President Clinton asked us to deliver our recommendations to a Cabinet-level group, the Human Radiation Interagency Working Group, whose members are the Secretaries of Defense, Energy, Health and Human Services, and Veterans Affairs; the Attorney General; the Administrator of the National Aeronautics and Space Administration; the Director of Central Intelligence; and the Director of the Office of Management and Budget. Some of the experiments the Committee was asked to investigate, and particularly a series that included the injection of plutonium into unsuspecting hospital patients, were of special concern to Secretary of Energy Hazel O’Leary. Her department had its origins in the federal agencies that had sponsored the plutonium experiments. These agencies were responsible for the development of nuclear weapons and during the Cold War their activities had been shrouded in secrecy. But now the Cold War was over.

The controversy surrounding the plutonium experiments and others like them brought basic questions to the fore: How many experiments were conducted or sponsored by the government, and why? How many were secret? Was anyone harmed? What was disclosed to those subjected to risk, and what opportunity did they have for consent? By what rules should the past be judged? What remedies are due those who were wronged or harmed by the government in the past? How well do federal rules that today govern human experimentation work? What lessons can be learned for application to the future?

Our Final Report provides the details of the Committee’s answers to these questions.

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Digital Education vs. The Ruling Elite

August 16th, 2010 Comments off

From Lew Rockwell.com

Ruling elites as recently as 1600 appealed to God to justify their continuing rule. This was called the divine right of kings: rulership beyond any earthly court of appeal. That began to be undermined in the second half of the seventeenth century. A century later, Enlightenment democratic theory had replaced the divine right of kings. The divine right of Parliament or the divine right of the People replaced it.

This forced a major strategic change on the ruling elite. The ruling elite has to pretend that it does not exist. It formally acknowledged the legitimacy of the People as the final court of appeal. This involved training and screening the judges.

Basic to maintaining this deception has been control over the media. Also vital has been control over the schools – compulsory attendance laws, teacher certification, tax funding, and school accreditation. Above all has been control over textbooks.

This control is ending in the area of printed media, especially newspapers, which are dying. Control over TV news is fading. Digits are killing them. Now control over education is about to be undermined. Same reason: digits.

COMPETING DIGITAL CURRICULA

I have recommended to Ron Paul that he hire a director of curriculum development in one of his educational organizations. The director should then contract with Ph.D.s to create a comprehensive K–12 curriculum. Once it is ready, Paul’s organization can post it online for free. I have presented this plan here.

Some parents will want courses taught live. Paul could also put together a faculty of graduate students with M.A. degrees or retired Ph.D.s to provide real-time lectures. The exams can be administered digitally. Record-keeping is digital.

He could charge a minimal $250 per course and split the money 50–50 with the faculty member who teaches it. This should be a profit-seeking venture. It could easily generate $25,000,000 a year. I have explained this here.

Free academic software now allows this. It’s called Moodle. Any medium-size organization can now afford to create an online high school or even a university with this open source software. The Mises Institute now has its own online program called Mises Academy. People pay a minimal $250 to take a weekly class. Dr. Tom Woods is teaching a course on Roosevelt’s New Deal this fall.

The existing system of government-funded education is facing a technological challenge. The Web can deliver content for free. The model for this is Salman Khan’s wonderful Khan Academy. Students from all over the world start with 1 + 1 = 2, and go from there through calculus. It is all done with free 10-minute YouTube videos.

He did this in his spare time just because he wanted to. Now he has funding to create an entire curriculum.
In contrast, this is the model of today’s high school.

Right? Right! You know it. I know it. We have known it all our lives. It never improves. It gets more expensive. It gets less efficient. We know it has no hope. Every few years, reformers announce a “new, improved” approach. It is not widely adopted, and wherever it is adopted, scores get worse. They will call for reforms forever. The system will just get worse.

It is paid to get worse. Tax money is automatic. No one stands up locally and runs for the school board on this platform: “Let’s cut the budget by 10% next year, and another 10% the year after next.” That would be considered the equivalent of blasphemy. Yet we know the tax-funded schools will not improve. Anyone who is so naïve as to believe that the Next Great Reform will be successful throughout the country probably ought to be institutionalized – at a minimum, he should be kept away from sharp objects.

THE COLLAPSE OF THE ACADEMIC CARTEL

The problem has been that private schools, also burdened with physical classrooms and buildings, are expensive. Not many parents have been willing to pull their children out of the tax-funded schools and enroll them in a private academy. They grin and bear it. “Our schools are not like those other communities’ schools. Ours are highly rated.” Really? Rated by whom? When? Using what methodology? How long ago?

Who produces the textbooks? New York publishing firms staffed by anti-capitalist Leftists? The same textbooks used in those other communities’ schools? You don’t say!

With the Web, a PDF file can be downloaded for free. This PDF can be a textbook. If it’s in the public domain, it’s free. You can print it out. Cost: toner and paper. Maybe you will want to buy a 3-hole punch and a $7 binder. After all, that 3-hole punch is a permanent investment. Amortize it over a 30-year period. You can afford it.

Do you want a video-based course? Salman Khan offers them.

How about MP3 audio files? There are free MP3 hosting sites. Anyone can post lectures.

MIT has put 2,000 mini-courses online for free. Did you know this? It’s here.

Local colleges have resisted this. If you were a faculty member of Podunk State University, would you want the whole world to see you and your peers online, 24×7? Would you be confident that parents and students would then be willing to pay $50,000 to get a degree from your backwater institution?

So, university faculties are now in a difficult position. They must justify the absence of online lectures and course plans. Silence is embarrassing. The story of MIT’s program is getting out. They will have to argue that MIT’s online curriculum is a fluke, that a normal university would not be wise in posting its lectures and course notes for the general public to view free of charge. Yes, MIT can do this, but it’s different. It’s different because. . . . Well, anyway, it’s different. It’s not fair to use it as a model. Why not? Because it’s the best. The academic world knows it’s the best. As an MIT T-shirt says: “Harvard: Because not Everyone Can Get into MIT.” The best doesn’t count.

By the way, Salman Khan went to MIT and then the Harvard Business School. Now look what he’s done. What’s Podunk State to do?

Podunk State knows it is delivering a substandard product. It knows that it can keep its doors open only because tax money subsidizes its program. If it is possible to provide digital education, with digital exams, digital grading, and digital record-keeping – and it is – then what does Podunk U bring to the table that (say) the 100 best colleges and universities could not do better? What is the justification for Podunk State?

Accreditation. That’s it? That’s it.

The collegiate system is a cartel. It is now being threatened by the University of Phoenix, with its 500,000 students at (probably) $10,000 each per semester. The academic community sees the threat of profit-seeking universities. With 15,000,000 students enrolled, it would take only three-dozen University of Phoenixes to teach them all. Let’s be generous. Say that 100 schools could do this. What would happen to the other 4,000?

Cartels always collapse. Only the threat of government violence against “cheaters” can sustain cartels. The collegiate cartel in the United States is maintained by a series of Federal government-recognized but privately run accrediting agencies – agencies staffed by members of the cartel. Here is the list.
What breaks cartels? Price competition.

PRICE COMPETITION

Decades ago, management expert Peter Drucker observed that whenever a new production technique lowers costs by 90%, it comes to dominate. The old producers can fight it, but they cannot prevail.

He said that existing producers can fight by pointing to the prestige of owning an expensive version. This is an appeal to the rich. It is an appeal to status. If you want an example of the status-dominated argument, see the response of the faculty at the University of California, Berekey, to the sensible suggestion that the campus offer distance-learing degree programs.

People who are really self-confident about their status do not play this game. I remember seeing an interview of Denzel Washington. He showed his watch: a Casio. “It cost $35, and it keeps perfect time.” That kind of statement sends a chill down the spines of people working for Rolex.

Today, the cost of delivering a good education has fallen by far more than 90%. It has fallen to the cost of bandwidth. Bandwidth keeps getting cheaper.

Back in 1997, Drucker gave an interview to Forbes. In that interview, he offered this assessment and prediction.

Thirty years from now the big university campuses will be relics. Universities won’t survive. It’s as large a change as when we first got the printed book.

Do you realize that the cost of higher education has risen as fast as the cost of health care? And for the middle-class family, college education for their children is as much of a necessity as is medical care – without it the kids have no future.

Such totally uncontrollable expenditures, without any visible improvement in either the content or the quality of education, means that the system is rapidly becoming untenable. Higher education is in deep crisis.

If he was correct, the large physical universities have only 17 years to go.

Do I think they will disappear this fast? No. Why not? Because control over education is the #1 control device of the ruling class. It is even more important than the control over central banking.

The American educational system absorbs something in the range of 6% of the country’s GDP, which means over 10% of the private sector’s output. The finished product is a curriculum built on the presuppositions favored by the ruling class. State-funded institutions teach respect for state funding and the bureaucrats who control the flow of funds.

If state-funded education were ever to end, the major means of control by the ruling class would end. The ruling class will not surrender this control without a fight. But it will lose this fight.

The tools of this fight are digital. The basis of this fight is ethical: the right of parents to control the content of their children’s education. The state-funded bureaucrats know this. They have fought ever since the foundation of the modern educational system in Prussia after 1810 to insulate their class from political control, while collecting tax money. This is the basis of the doctrine of academic freedom. It means freedom from interference by taxpayers and politicians.

By severing payment from control, the educrats have gotten themselves a sweet deal. Like the Congregational ministers in New England before 1819, they are on the state’s payroll, but they insist on autonomy.

The cost of this arrangement is skyrocketing. The educational cartel is facing a revolt. Parents who don’t like the content of tax-funded education are breaking ranks. They are teaching their children at home. This was fought by the states in the 1980s, but a series of court cases undermined the laws against home schooling.

Now budget cuts are forcing public school districts to adopt distance-learning programs. This is the death knell for the system. The tax-funded schools are facing budget ceilings. Meanwhile, education is getting steadily cheaper.

Dr. Art Robinson’s Robinson Curriculum costs $200 for K–12. It’s a one-time payment for the entire family. Yet it could be placed online and given away for free. The curriculum is self-taught. Students who pursue it can quiz out of two years of college, as his children did. They can enter college as juniors at the age of 16.

Of course, a wise parent will not send a child off to college at age 16. So, the child can take the last two years in a program such as Louisiana State University’s distance learning program, or at Excelsior College, a private online campus.

Total cost of college? Under $11,000. The student can work part-time and pay his way through college.

Or else he can ask his parents to foot the bill of a conventional on-campus program ($50,000 to $250,000). He can also take on $20,000 in personal debt, which is now the national average.

If he flunks out, all this money is down the drain. Yet about half of students who enroll as freshmen do not graduate.

Which approach makes more economic sense?

What are you buying? An education or a shot at status? Is it a Casio or a Rolex?

There are not many Rolex-type watch firms. There are only about three-dozen Rolex-type universities. They enroll about 2% of the college population.

What is the future for the 4,000 others? Extinction or adjustment to the world of digits.

Digits are cheap.

A DIGITAL DAGGER

This is a digital dagger at the heart of the ruling elite. As this spreads, it will be the end of the nearly monolithic educational worldview, a worldview that rests on the assumption that ideas must be controlled, and that this control is best accomplished through screening. Such screening procedures must be in the hands of gatekeepers. These gatekeepers must be certified by other gatekeepers and protected by the state.

The Internet has destroyed most of the walls that give power to control over the gates. The center will not hold. The many competing views of how the world works will act as acid for the worldview of the power elite.

The historical mark of the collapse of the strategy of gatekeeping, after 5,000 years, was Matt Drudge’s 1998 story about “Newsweek,” which had suppressed the story of the unnamed intern and Bill Clinton. Soon, she was named. Then Clinton was impeached. His Teflon charm let him avoid conviction, but his reputation never recovered. He will always be remembered as the smiling rogue with a roving eye and a cigar. This is not what a member of the ruling elite expects after his successful lifetime effort to shinny up the greased pole of political success. It takes all the fun out of it.

We need an image that represents the digital transformation. I think it ought to be Alex Jones’s bullhorn. He posts those video clips of him and some of his supporters standing outside a Bilderberg meeting or some other closed-door conclave of the ruling elite. He has his trusty bullhorn in hand. He shouts at them. He tells them that the People are watching. They don’t know what to do about this. The video will be on YouTube within a few days – maybe hours.

Are the People watching? A few may be. Probably not all that many. They are watching funny videos, or pornography, or some other entertainment. But, from the point of view of the ruling elite, nobody is supposed to be watching a Jones video. They hate him and his bullhorn, but they can do nothing about it. Yes, someone hacked Jones’s YouTube video of “The Obama Deception” in mid-July, removing it after 6,000,000 hits, but that merely annoyed him. It did not stop him. It is back up.

CONCLUSION

We are living in the era that will go into the textbooks. If I had the influence to name it, the way that historians designated 1946–1991 as “the Cold War,” I would call 1995 “the end of the gatekeepers.” It is the Berners-Lee era, but that reference is too obscure.

Every ruling elite rules on behalf of a basic idea, and this idea usually has a slogan. I think the ruling idea today is this: “the mixed economy.” Digital technology and state bankruptcies are going to unmix it.

Karl Marx called capitalism’s system “the cash nexus.” Others summarize it as “money talks.” I call it price competition.

The ruling elite has justified its claim to sovereignty and therefore legitimacy in terms of superior technological wisdom – the unique possession of an elite. One institution stands as a testimony against such a claim: Wikipedia. I think it will still be around in 2100. I don’t think today’s ruling elite will be.

Gary North [send him mail] is the author of Mises on Money. Visit http://www.garynorth.com.He is also the author of a free 20-volume series, An Economic Commentary on the Bible.

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Video: Judge Napolitano – The Government Lies to You!

August 16th, 2010 Comments off

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Government Bullies Shut Down Little Girls Lemonade Stand

August 16th, 2010 Comments off

From Oregon Live

It’s hardly unusual to hear small-business owners gripe about licensing requirements or complain that heavy-handed regulations are driving them into the red.

So when Multnomah County shut down an enterprise last week for operating without a license, you might just sigh and say, there they go again.

Except this entrepreneur was a 7-year-old named Julie Murphy. Her business was a lemonade stand at the Last Thursday monthly art fair in Northeast Portland. The government regulation she violated? Failing to get a $120 temporary restaurant license.

Turns out that kids’ lemonade stands — those constants of summertime — are supposed to get a permit in Oregon, particularly at big events that happen to be patrolled regularly by county health inspectors.

“I understand the reason behind what they’re doing and it’s a neighborhood event, and they’re trying to generate revenue,” said Jon Kawaguchi, environmental health supervisor for the Multnomah County Health Department. “But we still need to put the public’s health first.”

Julie had become enamored of the idea of having a stand after watching an episode of cartoon pig Olivia running one, said her mother, Maria Fife. The two live in Oregon City, but Fife knew her daughter would get few customers if she set up her stand at home.

Plus, Fife had just attended Last Thursday along Portland’s Northeast Alberta Street for the first time and loved the friendly feel and the diversity of the grass-roots event. She put the two things together and promised to take her daughter in July.

The girl worked on a sign, coloring in the letters and decorating it with a drawing of a person saying “Yummy.” She made a list of supplies.

Then, with gallons of bottled water and packets of Kool-Aid,  they drove up last Thursday with a friend and her daughter. They loaded a wheelbarrow that Julie steered to the corner of Northeast 26th and Alberta and settled into a space between a painter and a couple who sold handmade bags and kids’ clothing.

Even before her daughter had finished making the first batch of lemonade, a man walked up to buy a 50-cent cup.

“They wanted to support a little 7-year-old to earn a little extra summer loot,” she said. “People know what’s going on.”

Even so, Julie was careful about making the lemonade, cleaning her hands with hand sanitizer, using a scoop for the bagged ice and keeping everything covered when it wasn’t in use, Fife said.

After 20 minutes, a “lady with a clipboard” came over and asked for their license. When Fife explained they didn’t have one, the woman told them they would need to leave or possibly face a $500 fine.

Surprised, Fife started to pack up. The people staffing the booths next to them encouraged the two to stay, telling them the inspectors had no right to kick them out of the neighborhood gathering. They also suggested that they give away the lemonade and accept donations instead and one of them made an announcement to the crowd to support the lemonade stand.

That’s when business really picked up — and two inspectors came back, Fife said. Julie started crying, while her mother packed up and others confronted the inspectors. “It was a very big scene,” Fife said.

Technically, any lemonade stand — even one on your front lawn — must be licensed under state law, said Eric Pippert, the food-borne illness prevention program manager for the state’s public health division. But county inspectors are unlikely to go after kids selling lemonade on their front lawn unless, he conceded, their front lawn happens to be on Alberta Street during Last Thursday.

“When you go to a public event and set up shop, you’re suddenly engaging in commerce,” he said. “The fact that you’re small-scale I don’t think is relevant.”

Kawaguchi, who oversees the two county inspectors involved, said they must be fair and consistent in their monitoring, no matter the age of the person. “Our role is to protect the public,” he said.

The county’s shutdown of the lemonade stand was publicized by Michael Franklin, the man at the booth next to Fife and her daughter. Franklin contributes to the Bottom Up Radio Network, an online anarchist site, and interviewed Fife for his show.

Franklin is also organizing a “Lemonade Revolt” for Last Thursday in August. He’s calling on anarchists, neighbors and others to come early for the event and grab space for lemonade stands on Alberta between Northeast 25th and Northeast 26th.

As for Julie, the 7-year-old still tells her mother “it was a bad day.” When she complains about the health inspector, Fife reminds her that the woman was just doing her job. She also promised to help her try again — at an upcoming neighborhood garage sale.

While Fife said she does see the need for some food safety regulation, she thinks the county went too far in trying to control events as unstructured as Last Thursday.

“As far as Last Thursday is concerned, people know when they are coming there that it’s more or less a free-for-all,” she said. “It’s gotten to the point where they need to be in all of our decisions. They don’t trust us to make good choices on our own.”

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