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Air America: Administration and Financing

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Air America: Administration and Financing Company Management, Administration, and Ground Support II – at the times of Air America Part 1: 1959-1973 by Dr. Joe F. Leeker First published on 24 August 2015, last updated on 10 July 2020 IV) Widening operations: The CAT-Air America-Air Asia complex (April 1959-1973) As has been shown in the first part of this file, the CIA, as the owner of CAT Incorporated (renamed Air America Inc. in 1959), controlled the Company by committees that met at Washington or New York and whose decisions had to be executed by the Management in the “Field” that is in the Far East. In 1989, the CIA described Air America even as “the largest of the CIA’s proprietaries”: Background material about Air America Inc. Memorandum for the record dated 14 August 1989, sent to Congressman Jack Russ upon his request1 It will also be recalled that a CIA-Proprietary was not equivalent to a US Government-owned corporation. For the CIA-Proprietary can do and did covert operations, as it was controlled only by CIA Headquarters2 and by a US Government Committee formerly called the 303 Committee,3 but not by the Congress. Government-owned corporations, however, have to be incorporated by Congress and have to submit their budgets to Congress, so that their actions are more or less public and evidently exclude covert operations.4 As the holding company of the complex, the Airdale Corporation, later renamed The Pacific Corporation, was responsible for financing. The Board of Directors, which was composed of CIA men and what has been called “business-friends of the Agency”5 and whose Executive Committee made the decisions in day-to-day business, was responsible for having the guidelines of CIA policy observed by the Company. On the other hand, the “Field” Head 1 See no.5, in: https://www.cia.gov/library/readingroom/docs/CIA-RDP92M00732R000700070024-8.pdf . 2 In the case of the CAT-Air America-complex, this was the CIA’s Deputy Director for Support. See, for example, CIA DD/S Col. L.K. White, Memo dated 1 May 62, re “Inspector General’s Survey of Civil Air Transport (CAT)”, at: http://www.foia.cia.gov/sites/default/files/document_conversions/15/c05260981.pdf . 3 For the 303 Committee and its predecessors (the 5412 Committee, the Special Group, and others see https://en.wikipedia.org/wiki/Oversight_of_United_States_covert_operations . This committee consisted of the President or his representative and high representatives of State and Defense; it approved, disapproved or modified covert operation proposals submitted by the CIA. 4 See the quotation from the ODNI Report, July 2011, p.27, made in my file Company Management, Administration, and Ground Support I – at the times of CAT (1947-1959), p.11. 5 Leary, Perilous missions, p.150. 1 Offices at Taipei sent across the Pacific Ocean reports, propositions, and requests that were discussed and approved or rejected by the Board of Directors during their meetings at New York or Washington. This is why in this file, too, there are two main sections: Boards and Committees and Management. Again, the list of CAT, Air Asia and Air America personnel given here is necessarily incomplete, as only those names are mentioned that appear in the – mostly written – sources that were accessible to the author. 1) Backstage Between 1959 and 1964, there was a long dispute inside the CIA. The question was whether Air America should remain under the Deputy Director for Support (DD/S) or be transferred to the Deputy Director for Plans (DD/P), who also ran the Clandestine Services. After US President Kennedy had directed the CIA on 9 March 1961 to run the secret war in Laos, complaints came from CIA “in the field about Doole and Grundy, saying that they might know how to run an airline operation but they didn’t know how to run a war”.6 Apparently, similar complaints had also come from Hugh Grundy’s “Assistant” L. Brentlinger, who represented the CIA.7 From 12 to 15 December 1961, there was a conference at Washington attended by CIA and Air America about how to improve the situation. As a result, the position of a Senior Air Operations Officer (SAO) was created who was to be responsible for all Agency air operations for Southeast Asia, and the person named was Col. “Heinie” Aderholt (stationed at Takhli), who was later succeeded by Col. Blizzard (stationed at Clark). Similarly, the CIA overruled the opposition of George Doole and Hugh Grundy against the creation of the office of a Regional Director for Southeast Asia as an Air America counterpart to the SAO, who – although also the Base Manager of Bangkok – was to be in charge of all Air America operational flying in Thailand, Laos, and South Vietnam. In this way, the CIA believed to have established a mechanism to bypass Doole and Grundy in favor of a decision-making by the Regional Director. Grundy immediately designated Ronald E. (“Doc”) Lewis, who had once supervised the Booklift operation in Tachikawa, as Acting Regional Director. In May 62, former USMC Colonel John P. McMahon became Regional Director for Southeast Asia.8 Indeed, Recommendation No. 28 of the Inspector General’s Survey of Civil Air Transport (CAT) of 1962 said: “That the Deputy Director (Support) direct CAT to appoint a senior task force commander for covert operations in Southeast Asia and assure that he is given local authority.”9 In his comment dated 1 May 62, the CIA’s Deputy Director for Support Colonel Lawrence K. White said: “CONCUR. Effective 15 January 62, the position of Regional Director for Southeast Asia was established with Headquarters in Bangkok. [erased] This position has been temporarily filled by the appointment of Mr. Ronald E. Lewis, who has been with CAT since December 1946, and who most recently has been General Manager for Air America at Tachikawa, Japan, in charge of the [erased, i.e. Booklift] Operation. The total Regional Staff for Southeast Asia is Mr. Ronald E. Lewis (Regional Director), Capt. Fred Walker (Regional Chief Pilot), Mr. Ajor Brigada (Regional Operations Manager), Mr. Jackson L. Forney (Regional Technical Services Manager), Mr. William P. Cagney (Regional Traffic Manager), Mr. William D. Barrus (Regional Security Chief), Mr. C.Y. Wong (Regional Communica- tions Supervisor and in charge of the Flight Following Network). Additionally, there is assigned a project chief pilot for each special type of aircraft. As a permanent replacement for 6 Declassified Summary of Material from the History of Air America, from the Official “Secret” History prepared by the C.I.A., pp.24/5, in: UTD/Fink/B22F12. 7 Leary, Manuscript, ch. V, pp. 328/9, in: UTD/Leary/B19F3. 8 Leary, Manuscript, ch. V, pp. 385-89 plus 399, in: UTD/Leary/B19F3. 9 CIA DD/S Col. L.K. White, Memo dated 1 May 62, re “Inspector General’s Survey of Civil Air Transport (CAT)”, at: http://www.foia.cia.gov/sites/default/files/document_conversions/15/c05260981.pdf . 2 Mr. Lewis as Regional Director for Southeast Asia, the company has contracted to employ Colonel John P. McMahon, who will retire from the Marine Corps at the end of April after more than 20 years of service. He will assume his duties at Bangkok as soon as possible after the necessary indoctrination at the Taipei Office of the company.”10 DD/S, Memo of 1 May 62, re “Inspector General’s Survey of Civil Air Transport”, p.46 It seems, however, that this CIA plan was undermined by the Base Managers of Vientiane, Udorn, and Saigon who ignored any supervisory pretentions of the Bangkok-based Regional Director SEA, as did President Hugh Grundy, who did not delegate any additional authority to the Bangkok Regional Director.11 Anyway, as late as February 1964, the Distribution list of the Operations Circular not only had an RDSEA (Regional Director, SEA), but also an MTSSEA (Manager Technical Services, SEA), an RASEA (probably Regional Accountant, SEA), an RCP (Regional Chief Pilot),12 and, as can be seen below, there was also an RSC/SEA (Regional Security Chief, SEA). As to other recommendations of the CIA’s Inspector General, the DD/S, Colonel L.K. White, was more sceptical: “Recommendation No. 23: That the Deputy Director (Support) make no immediate change in the system of DD/S management of CAT. Comment: CONCUR […] In providing direction for the allocation and the movement of the company’s fleet and personnel, overt and covert activities are inseparable.”13 “Recommendation No.24: That the Deputy Director (Support) designate a senior officer to serve on his own Staff as a full-time project officer. Comment: NON-CONCUR. It is felt that the project14 can be run best by the continued use of a committee composed of representatives of the Agency components concerned. The committee’s principal function is to coordinate the air support requirements of the Clandestine Services with the company’s requirements for maintaining its 10 CIA DD/S Col. L.K. White, Memo dated 1 May 62, re “Inspector General’s Survey of Civil Air Transport (CAT)”, at: http://www.foia.cia.gov/sites/default/files/document_conversions/15/c05260981.pdf . 11 Leary, Manuscript, ch. V, p. 542, in: UTD/Leary/B19F4. 12 Distribution, Operations Circular of 3 Feb. 64, kindly faxed to the author by Ward Reimer. 13 CIA DD/S Col. L.K. White, Memo dated 1 May 62, re “Inspector General’s Survey of Civil Air Transport (CAT)”, p. 1, at: http://www.foia.cia.gov/sites/default/files/document_conversions/15/c05260981.pdf . 14 That is the CAT-Air America-Air Asia complex. 3 overt posture.
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