Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 GOVERMENT MOVES TO CENSOR COUNTERSPY COUNTER The Magazine For People Who Need To Know Volume 6 Number 1 $2 Nov.1981-Jan.1982

Libya: U.S. Propaganda and Covert Operations World Bank Blueprint for China

AIFLD: Secret Plan for El Salvador U.S. Destabilization of Canada?

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Unlike his friend R-ich.ard Nixor:, CIA Di­ Identitles I'rotecticn J,.ct'' is "designed rector t!itliam Casey cannot clairr:: ''I am to deal primarily witr:. the dar;age to OUY' r;ot a crook." On May 19, 1981 Judge inte3Zigence capabi Zities ...[emphas1: s Charles E·. Stewart, J1,. in Nev York con.­ addedj which is ca:used by ur"°'uthm,izec elided that Casey had unla1;iful ly n:1'.sled disclosures of identities, 1�·hether or not investors of HulHpionics, Inc. In a a particular officer• or· source is physi­ Casey-authorized offer•ing circular, pro­ cally jeor:ardized in each individual spect'ive ir:.vestoN: were not told that Mul­ case." InteUigence capabilit-ies, of tipionics had assumed $2.? miUi-cn in course, co1)eY' everythinr; fron' as sas sir:c­ mortga,ge debts - t-Wl,OCO of which was ti ons and destabilizations to ir�teU·{­ Casey's personal debt. gence gathering. The retention of Casey as CIA Director In the same letter, Casey revealed the 1 a;ter this ruling says a lot about the CIA draconian reach u:ith 1.;Jhich the CIA 1.tanted and the Reagan ai!,m1,'.nistration. The fact to endow HR4. Even though the CIA is for­ that he ripped off fellow investors ., hC1.,­ bidden to engage in policy-making, Cerney eVP-Y'., fs not the major concern 1•egarding recommer.ded the addition cf a "technical Casey. Rather., it is his initiation of ar.encJnent to HR4 ... with regard to u:hich 1.t;orldu,,11',de criminal covert operations - in searches and seizures may be conducted... " Afghanistan, Libya, Mozambique, El Salva­ Under this amendment the CIA could direct dor, Cuba, Mauritius and Iran (just to the FBI to undertake surprise searches of name a few) - whil-e simultaneously trying newspapers ar.d broadcasting neu.;sroorr:s pos­ to silence the U.S. media. Casey and the sibly preparing CIA exposes. T1:ese FEI CIA ar•e attempting to end press coverage searches would be all owed even to uncover of CIJ. operations by promoting passage of information derived from analysis of pub­ HR4 and S,391, the so-called "Intelliaencev licly available data. Included 1:n that da­ IdentiHes Protection Act." ta could be such items as private rr.emos As we go to press, the House has passed frorr. reporters to editors. In a few HR4 by a 354 to 56 vote with two a�er.d­ words, Casey admitted i;hat Counterspy has rr1ents. One outlaws the naming of overcov­ contended fer years: the CIA intends to er agents ever.. after they retire. The all but abolish the First Ameniment � oth..er amendment, offered by Rep. John 1.;1hich, after all, is only an amendment, Ashbrook (R.-Chio) outlaws the identifi­ according to former CIA offic1.:al Ray ,,..ation of uncercover intelligence Cline. agents by anyone "with reason to believe'' The CIA' s reason for urt'apping itself in that the identification would impair secrecy has nothing to do with real na­ U.S. intelligence activities. Ashbrook 's tional security. The so-called "Intelli­ amendment, which has the support of Pres­ gence Identities Protection Act" is an in­ ident Ronald Reagan and CIA Director tegral part of the Reagan ad�inistration's ��lliam Casey, led Edi,;ard Boland preparations for, and execution oJ� covert (D.-Ma.), the chairperson of the House CIA and, quite possibly, military opera­ Intelligence Corrrmittee, to vote against tions. CIA covert operations in the past, th.e. bill. Boland, who has pushed an "In­ such as the 1953 coup in Iran, have not telligence Identities Protection Act" for been in the interest of real national se­ benefit of U.S. years, feared that Ashbrook' s arnendment curity, but rather for the would make HR4 unconstitutional. In its multinational corporations. Moreover., they present forms, HR4 and S391 (the Senate's often undermined national security by "Intelligence Identities Protection Act") bringing us closer to another war;- There­ have very similar wordings. S391 is ex­ fore, it is the task of all citizens to pected to pass in the Senate �'ithout ma­ take strong actions against this legisla­ jor changes. tion and CIA covert operations in other which ravages In an April 29, 1981 letter to Bo Zand 1 countries. A government Casey a.dmitted that the ''Intelligence other peoples inevitably turns on its own.

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Contents NewsNOT Doremus, Ontario Hydro and the CIA ....4 in the News Ray Cline and James Billington ...... 5 U.S. Biological Warfare Against Cuba.. 6 Forgery AIFLD: Secret Plan for El Salvador .... 8 The CIA 's Opex-ation CHAOS and the FBI' s COINTELPRO went through g!'eat pains in the U.S. Marshall Plan for the Zate 1960e and eax-Zy 1970s to destx-oy the Caribbean: Counterinsurgency ...... 11 credibiZity and in some aases the vex-y ex­ istence of progx-essive pubZications. Indi­ Reagan Resurrects Savimbi ...... 15 cations ax-e, tha,t opemtions Zike these ha,ve not stopped. Libya: Propaganda and Eax,Uer this yea,x, a ma.jor attack was Covert 0perations ...... •... 20 Zaunched on CounterSpy's credibility when "someone" produced a "SpeciaZ Issue" of Mauritania? Mauritius?? ...... 22 Counterspy "Focusing on the CIA in Germa;­ ny." This f.()rged pamphlet, neatZy typeset The Gambia Betrayed ...... 40 and using g!'aphics from back issues of Counterspy was maiZed to the Frar,,kfurter Secret World Bank Infomationsdienst (FI), a progressive Blueprint for China ...... •... 42 West Geman pu.bZicaticn which is in the process of publishing a new magazine Dn The Ascher Memorandum: inteZZigence - the first such magazine in Marcos Plugs the Leak ...... 44 C'rerman. The pamphlet featured an articZe " "FRG: Made in U.S.A., po.rt two, supposed­ World Bank Counterinsurgency ly written by Kom:-ad Ege, (Ege had 1.vl'itten in the Philippines •.••••••••••••••• 47 c;n article in the real Counterspy in the Apri Z 197 9 is sue ur.ciex- the headline "Fed.­ Interview with Ian Adams: era i Repub tic of Germany: Made in U.S.A.. ") RCMP Demystified••••. .••••••••••••• 49 ae weiz as the names of 19 "CIA officers" __ ,_. · of compZete 1.:iith dates bix-ths, phone nwr.­ Is the U.S. Destabilizing Canaqa? ••.• 53 hers ari.d addresses in Bonn. FI·editors were imrnediateZy suspicious. The British Right and Intelligence .•. 55 Without citing any sources, the ai•ticZe contained numerous chax-ges of CIA infiZ­ Casey Names Names tx-ation and use of West Germany 's peaae Read CIA Director William Casey's spee.ch and envirorunentalist1 n;ovement. FI informed to CIA employees on July 2i, 1981. He Counte1Spy of their questions regarding defends his business dealings, outlines the "Special, Issue." l'l and Countex-Spy see future strategy for the CIA, reviews this forgery net only as an attempt to un­ de1"TTline Counterspy's credibility but aZso "progress" made, names names of high j ranking CIA officers, and praises former as an attack on FI's px-c eat to develop a CIA Director Richard Helms, a convicted �'eet Gerrr.an magazine on in.teZUgence. perjurer. Available from CounterSpy ($1.60, includes postage in U.S., add $.90 for overseas airmail). �adat 's Confession CounterSpy is available in microfilm from: UNIVERSITY MICROFILMS INTERNA­ "Let me reveal this secret. The first TIONAL, 300 North Zeeb Rd., Dept. P.R., moment the Afghani inc.ident G,verthrow of Ann Arbor, MI 48106; and 30-32 Morti­ Hafizullah Amin and Soviet troop movements mer St., Dept. P.R., London WlN 7RA, into Afghanistan] took place f!n December England. 1979], the U.S. contacted me he�e �nd the Counterspy -- Nov.81 - Jan.82 -- 3

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 transport of armaments to the Afghanis rying out operations that were considered started from.Cairo on U.S. planes." So too sensitive for the CIA. said Egyptian President Anwir Sadat to NBC Reportedly, Inman decided to end Task TV on September 22, 1981. For the first Force 157 when former CIA employee Edwin time one of the high government officials Wilson offered to raise more congressional directing,the major covert operation funding for 157. However, it is not known against Afghanistan admitted publicly the what Inman decided about Wilson's sugges­ existence of a large scale joint aid pro­ tion to set up a "counterpart to Task gram to the Afghan rebels. Sadat also con­ Force 157." The possibility that a Task firmed that he would continue to aid the Force 157-type operation is continuing was CIA in its arms shipments to the rebels suggested by the arrests in 1980 of "until the Afghanis get ••• the Soviets out DuWayne Terrell and William Thomas as of their country." Sadat's admission f i- · spies for the CIA and Israeli intelligence nally puts the lie to U.S. government as­ in the Yemen Arab Republic. Terrell and sertions that most of the Soviet-made Thomas were working for Aeromaritime, weapons the rebels have are captured from which had served as a business front for the Afghan or Soviet. Army. In reality, Task Force 157 in the early 1970s. Obvi,.,, they are Egyptian-made replicas of Soviet ously, Aeromaritime was not closed down by arms. Inman.

Only Courage? Doremus Ontario Hydro and the t IA "Courage I.s Our Weapon" is a newly re­ leased "documentary" about the Afghan ref­ ugees in Pakistan. It was shown first at With the Reagan administration threaten­ the Second Annual Afghan Fair on September ing to take drastic steps to prevent Cana­ 25 in Washington, D.C. Prior to the show­ da from taking more control over its own ing, the "Afghan Relief Committee," a U.S. raw materials and resources (presently organization collecting funds for the ref­ U.S. corporations own about 80 percent of ugees hosted a benefit dinner. The guest Canada's resources; see "Is the U.S. ne­ list is self-explanatory: CIA Director stabilizing Canada?" in this issue), U.S. William Casey, former ambassador to Saudi investment in Canada's energy market has Arabia and Relief Committee official, become a critical i$sue in U .'S .-Canadian Robert Neumann, former assistant secretary relations. It is somewhat contradictcry of state Harold Saunders, American Federa­ then,that one major Canadian energy compa­ tion of Teachers head Albert Shanker, Pa�· ny, Ontario Hydro, is still trying to at­ kistani ambassador to the U.S., Ejaz Azim, tract U.S. investment through its New York and self-proclaimed CIA collaborator public relations firm, Doremus and Co. Arnaud de Borchgrave. Doremus, which was taken over by another public relations firm, BBDO Co. last year, isn't just "any old company." Its former clients include some extremely repressive governments - the late Shah of Iran, the 157: Alive and Well ? Marcos regime in the Philippines, King Hussein of Jordan, and the Saudi royal When then-Director of Naval Intelligence family - and it presently represents the Bobby Ray Inman (now CIA Deputy Director) Turkish military government. decided to close down Task Forte 157 in A number of past and present Doremus of­ February 1976, he terminated one of Naval ficials came to the company from tlie CIA, Intelligence's most secret operations. the State Department, and the Pentagon. Task Force 157, headed'by Capt. Darryl A. They include John W. O'Connell, the former DeY.aris at its closing, was engaged in in­ CIA Chief of Station in Jordan; Doremus telligence gathering on Soviet nuclear Vice President George L. Fischer who ac­ weapons, infiltration of international knowled in an interview with the Chica- maritime unions, and in general, was car- go Sun ;es (3/14/78) that he had been 4 -- Counterspy -- Not'. Bl, - ,7an.82

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 working for the CIA in the late 1950s; and da's intelligence agency, the Royal Cana­ former Vice President William Codus, As­ dian Mounted Police (RCMP). Worthington sistant Chief of Protocol in Henry has knowingly published RCMP disinforma­ Kissinger's State Department. tion about alleged Communist activit,ies in Doremus qegan to work for Ontario Hydro Canada, and has served as an RCMP apolo­ in 1971. In order to attract U.S. inves­ gist against justified public criticism. tors, Doremus places advertisements in (See CounterSpy, vol.5 no.3, p.52 and U.S. publications and, in general, tries "RCMP Demystified" in this issue.) to create favorable publicity for Ontario Hydro in the U.S. Doremus has pr oduced numerous press releases praising Ontario Hydro as "Canada's largest utility" which has made "arrangements with its United States interconnections" to reserve on a Ray Cline ... first call basis the purchase of its power by U.S. customers in .times of "peak de­ "Dear C.S. Staff: Forget what you've mands." In a December 2, 1974 press re­ read about the C.I.A. up until now..... lease, Doremus announced that a "total of Prepare yourself for the uncompromising 510,000 kilowatts" of Ontario Hydro's pow­ truth about the C. I .A... " wrote Laurie er is reserved for U.S. customers on a Dustman Tag of Acropolis Books Ltd. in•a first call basis. letter to CounterSpy on August 10, 1981. When Ontario Premier Davis visited the She was announcing a new book by former U.S., Doremus, according to a statement CIA Deputy Director Dr. Ray Cline enti­ filed with the U.S. Department of Justice tled The CIA. It is supposed to be the fi­ under the Foreign Agents Registration Ac;, nal word on the CIA and is described as assisted him "in1 certain functions... dur- "fascinat�ng." Dustman Tag wrote that she ing the week of May 16, 1977. This assis- is sure Counterspy will "find an excerpt tance took the form of providing transpor­ from the book which will be perfect" to be tation and other general assistance to the reprinted in Counterspy. She also wanted press covering the Premier's visit, assis­ to "talk soon." tance with getting T.V. films en route We didn't find an excerpt. The CIA is from N.Y. to Canada for use within that hardly informative (most of itistrans­ country ...." planted from Cline's previous book, Se­ For Doremus the Ontario Hydro deal has crets, Spies and Scholars) and it ispoor­ been financially rewarding. From August ly written. We couldn't agree more with 1980 to February 1981, for example, Cline's assessment in the preface that the Doremus got $143,716 as "professional ser­ book might come across as being "egocen­ vice fees and reimbursement of out-of­ tric." It is. Cline knows everything and pocket expenses." That makes Ontario Hydro has all the correct strategies for the one of Doremus' most lucrative foreign ac­ CIA. He gives high marks to CIA Director counts. William Casey and the Reagan administra­ tion's "new approach" to intellig£:nce. Casey, according to Cline, did a tremen­ dous job in raising morale in the agency, and "intelligence officers began to slough More Disinformation off the feeling of being pariahs - or even criminals..•. " Donald Hunt, the general manager of the A promotional flyer for The CIA an­ Toronto Sun feels that he "could find an nounces: "Watch for Ray Cline on 'Good audience"for a paper like the Sun in Morning, America' and ether major media Washington, D.C. ; and ,after the shut,-down this fall." This seems to be the ulterior of the Washington Star, the Sun hired for­ motive of The CIA: to serve as a vehicle mer Star associate editor Sidney Epstein to get mass media exposure for Cline's to keep the Sun informed about the possi­ right-wing views. bility of starting a new D.C. daily. The Toronto Sun, a rightwing tabloid-form dai­ ly, is published by none other than Peter Worthington who has close ties with Cana- Counterspy -- Nov.Bl - Jan.82 -- 5

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Cline as seen in this excerpt from an ... and James Billington April 1958 letter froin Dulles thanking , Billington for a copy of a book he had . One incident Cline describes in The CIA just written• involves James Billington, a former CIA I'was interested to hear of your plans officer who now heads the Woodrow Wilson for a trip and would appreciate your let­ International Center for Scholars of the ting me 'know when details are firmed up. Smithsonian Institute in Washington, D.C. I would Zike to have our boys have a talk In 1956, Cline and Billington were taken with you before you go, if agreeable with along by then-CIA Director Allen Dulles on you. In.the meantime I will be looking . a world-wide trip to CIA stations. "This forward to seeing you in June if you do was a big break for me," writes Cline, get doum to Washington then. Just drop a "because Jim, being very junior, did most note or' call the office and Miss Tiet­ of the briefcase carrying ••••" hammer will arrange a mutuaZfy co�venient Billington seems to have enjoyed the time for us to get together� trip anyway, since he wrote a groveling Billington, in fact,. continued as one of "poem" entitled "The Voyager" honoring the CIA' s notorious "Princeton Consµl­ Dulles. The poem concludes: tants" while a professor at Princeton Uni-· M1'. D. worked aZZ day versity. In June 1981, Billington also While the others woutd play testified before the Senate Subcommittee Yet he seldom let loose his thunder on Security and Terrorism on "Historical He's a man that his troops Antecedents of Soviet Terrorism." In thiE:> AU felt as a group hearing Billington presented his new defi­ Mighty glad and proud to be under. nition for the word "terrorist": the ter­ Billington's ties with the CIA did not rorist is the II "ultimately committed revo­ end with his departure,from the agency lutionary•.•• shortly after his trip with Dulles and

U.S. Biological Warfare Against Cuba .

Cuban President Fidel Castro recently well as one of Cuba's vital staples, pork. made serious charges about a new biologi­ The State Department and the U.S. media cal warfare program against Cuba. On'July were quick to f idicule and discount 26, 1981, the 28th anniversary of the at­ Castro's charg�s. The Washington Post, for tack on the Moncada Garrison, the begin­ one, claimed that the charge of dengue fe­ ning of the Cuban revolution, Castro stat­ ver being introduced into Cuba by the CIA ed that the government shares "the peo­ "makes no medical sense." While it is · ple's conviction and [harbor� the pro­ true that there are natural causes for a found suspicion that the epidemics which dengue ·fever epidemic, the possibility of have hit our country, especially the hem­ CIA dirty work cannot be dismissed out of orrhagic dengue, may have been introduced -p.and. into Cuba by the CIA." He pointed out that The U.S. has a long history of using bi­ over the last seven weeks, 113 people had ological weapons. A top-secret 1956 U.S. died of dengue fever, ar.d nearly 300,000 Army document, for example, urges that were infected. In addition, Castro raised "military operational policies, plans and questions about other plagues that had hit directives dealing with the offensive de- Cuba during the last two years: African ployment of BW [!,iological weapon� swine fever, sugar cane rust, and blue against specific targets" as well as "the ' mold on tobacco. Castro queried about a fact that specific living agents or their U.S. government role iri introducing these toxic derivatives, identified by specific pests which debilitated two key Cuban ex­ name and/or description, had been stan­ port commodities, tobacco and sugar as dardized for offensive military employ- 6 -- .counterspy -- Nov.Bl - Jc:n.82

Ap roved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 ment" has to be kept "top secret." In his Organization stated that the swine fever book, Chemical and Biological Warfare - outbreak in Cuba was the "most alarming America's Hidden Arsenal, Seymour Hersh event" of 1971 in the Western Hem:f,.sphere, also quotes a report stating that an in­ and Fidel Castro said in his 1971 speech ventory at Fort Detrick, Maryland includ­ celebrating the anniversary of the attack ed "mosquitoes infected with yellow fe;, on the Moncada barracks: "The origin of ver, malaria and dengue (emphasis addet!l; the epidemic has not yet been ascer­ fleas infected with plague; ticks with tained. It could be accidental·or it could tularemia, relapsing fever, and Colorado have been the result of enemy activity. On fever; houseflies with Cholera, anthrax, various occasions the counter-revolutiona­ and dysentery." In addition, Fort Detrick ry wormpit @uban terrorist groups in the facilities, which have been used by both u.sJ has talked of plagues and epidem- the CIA and the Army, included "laborato­ ics •••• " ries for mass breeding of pathogenic mi­ A proposal for a CIA food study (re­ croorgani�s and greenhouses for investi­ printed in CounterSpy, vol.4 no .1) serves gating crop pathogens and various chemi­ as one more indication that the CIA is cals that harm or destroy plants." targeting Cuban food production in its In 1977 it was further revealed that the continuing war against Cuba. The study re­ CIA, during the early 1960s maintained a quested by the CIA was to "evaluate na­ clandestine "anti-crop warfare" research tional nutrition and health problems and program "targeted at a number of strengths ••• as they affect food avail­ countries." (Washington Post, 9/16/77) In ability and consumption requirements of spite of the 1969 order by President key les·s developed countries ••• " One of Richard Nixon to halt research on and the "key countries" listed in this pro­ planning and stockpiling of offensive bio­ posed 1978 one-year study was Cuba. The logical and chemical weapons, the CIA and study was supposed to answer 'questions in­ the Army have continued research on and cluding: "What are the nutrition and dis­ use of such weapons. ease factors related to food availability Newsday reported on January 9, 1977 that and utilizationi; what is the impact of "with at least the tacit backing of t!.S. the biological/ecological/cultural envi­ Central Intelligence Agency officials, op­ ronment on nutrition, health and dis­ eratives linked to anti-Castro terrorists ease?"; and finally, ''what is the impact introduced African swine fever virus into of national food needs and demands which Cuba in 1971." The operation was success­ result in parallel incidence of debilita­ ful. Six weeks later an outbreak of swine tion and crippling diseases in the labor fever forced the slaughter of 500,000 force?" pigs to prevent a nationwide epidemic. Biological warfare research by the Army Newsday described how the biological war­ and the CIA is not a thing of the past. fare operation was carried out: One intel­ For example, last year U.S. "government ligence operative \oras given a- sealed con­ laboratories" were studying the rift val­ tainer with the swine fever virus in Fort ley fever virus for use "as a bfological Gulick in the Panama Canal zone. At Fort warfare agent." Like dengue fever, rift Gulick, according to Newsday. the CIA also valley fever is transmitted by mosquitoes; "operates a paramilitary training center it causes blindness, severe bleeding and for career personnel and mercenaries." At liver damage, and can cause inflammation the time, Fort Gulick was also used as "a cf the brain and death. Col. Gerald A. staging 'area for covert Qperations in the Eddy, the chief virologist at the U.S. Caribbean and Latin America." Army Medical Research Institute in Fre­ From Fort Gulick, the container with the derick, �.aryland commented on the danger virus was transferred to members of a of rift valley fever. ''We think the counter-revolutionary Cuban group,, who world is relatively unprepared for this took �t by trawler to Navassa Island, a potentially devastating virus.".According deserted U.S.-owned island between Haiti to Col. Eddy, only the U.S. Army has cer­ and Jamaica. After a stopover in Navassa,· tified va�cine, and it is only enough to the container was taken to Cuba and given immunize some 100,000 people. (Facts -on to operatives near the U.S. military base, File, 4/25/80) Guantanamo. �t the CIA wants to "keep the option The United Nations Food and Agricultural open" to use biological warfare was con- CounterSpy -- Nov.Bl - Jan 82 -- 7

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 firmed in a "joke" by then-CIA Deputy Di- lence, plague or mass destruction of . rector Frank Carlucci. (He is now Deputy. property. In the CIA there was a Secretary of pefens.e.) Carlucci stated in tongue-in:-cheek comment that we ought a speech given to the American Bar Asso­ to oppose this just to keep.our op­ ciation in June 1980 that he is opposed tions open." to any prohibition of biological warfare:· In spite of the·devastating effects of "We've gone through successive itera­ successive plagues, Cuba has proven in tions of intelligence legislation� the past that the country is able to de­ there are some concepts that lµlve feat attempts by counter-revolutionary arisen that I personally consider a Cubans and the CIA - including biological bit curious or difficult. One is that warfare - to defeat the revolution. Far we can reduce every detail of �he in­ from destroying it, attacks on Cuba have telligence business to statute. The strengthened the determination of the Cu­ original intelligence charter •• ·• had ban people. Says Fidel Castro: "This an array of prohibitions ••• There was country may be wiped off the face of the one ·that said CIA agents should be earth, but it will never be intimidated prohibited from overtly taking an ac­ or forced to surrender." tion likely to lead to flood, pesti-

AIFLD: Secret Plan for El SalvadOr by John Kelly

In a searing self-indictment, the Ameri­ General Romero was replaced by a civilian/ can Institute fbr Free Labor Development military junta." (AIFLD) puts the lie to its land reform Cohen would have us believe that El Sal­ program in El Salvador. A draft of AIFLD's vador is still ruled by the 1979 civilian/ 1981 working paper on land reform - leaked military junta .which, he added, "recog­ to CounterSpy - claims the. r�form is di­ nized the need for land reform so as to rected toward "a drastic overhaul of the change an archaic, political system [and] land tenure system" controlled by the to right extreme social and economic in­ 11 "economicI powers of the country. 1 In justic (sic) •••." Some civilians in the short, land is supposed to be redistribut- 1979 junta may have viewed land reform as ed from the landed oligarchy which, ac­ such. However, they resigned on January 3, cording to draft author Bruce Cohen, con­ 1980 because "the military [bas] failed to trolled El Salvador until 1979 through keep its112 political·and economic prom­ "the application1 of extreme economic, po-. ises. Moreover, moderate officers in the litical and military power." 1979 junta have either resigned or are now The AIFLD report ignores that support of dominated by conservative officers who are the junta directly contradicts-the goal of undoubtedly among those who, Cohen says, drastically overhauling the land tenure consider "land reform" a means to "coun­ system because the .present junta is again teract the appeal of the left in the coun- controlled by the oligarchy and the mili­ . tryside." tary. This is where the lie comes in - a In effect, AIFLD's land reform is coun­ "reform" that underpins the junta keeps terinsurgency in the service of a junta the land in the hands of the oligarchy. brutally opposed to true land reform. The Cohen glosses over this contradiction by primacy of the counterinsurgency role is writing as if there have been no changes highlighted by Roy Prosterman who, Cohen since October 1979 when "the government of say,s, has ''devoted extensive time and ef­ �ort" to the land reform. Prosterman, who (John KeZZy is ao-editor of Counterspy talks like a politico-military strategist and the author of the. forthaoming book, has written that a first goal. of the land The CIA in Ameriaa.) reform is to "broaden the base of the jun- 8 -- Counterspy -- Nov.Bl - Jan.82

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11 ta; 3 and 'that a "desperate" junta turned Undersaor>ing AIFLD's aounterinsurgenay to AIFLD because "most of the campesino role in El Salvad.or was the following (peasant] sector in El Salvador [wai[J un­ statement before the Supreme Court by organized or radicalized by extreme left­ 4 then-U.S. SoZiaitor General Wade Mccree ists. 11 In June 1980, he predicted that about AIFLD's Miahael Hammer and Mark "if the reforms are successfully carried Pearlman: "· •. For example -, I'm off the out here, the armed leftist onslaught will reaord in anewering this - but just re­ be effectively eliminated by the end of 5 cently -two Americans were killed in Sal­ 1980.11 vador (sia). Apparently they were some Prosterman's involvement leaves no doubt kind of underaover persons working under that the land reform is being subverted the aover of a labor organization, and for counterinsurgency purposes. The extent if this person [Philip Agee] identified of his involvement also questions the le­ them as not by what they appear to be gitimacy of the reform. According to but as undercover operatives.... " Cohen, "these three consultants, (Roy (Edward S. Muskie, Secretary of State, Prosterman, Jeff Riedinger, and Mary Petitioner, v. Philip Agee, Respondent, Temple), especially Dr. Prosterman, worked No.80-83, Washington, D.C., Oral Argu­ extensively on [land reform] Decree 207 ment, Supreme Court of the United State� and the general framework for its imple­ January 14, 1981, pp.21, 22.) menting regulations. Dr. Prosterman has advised AIFLD, UCS (union Comunal Salva­ "During the first days of the reform - dorena, an AIFLD-created union], and to cite one case - 5 directors and 2 pres­ FESINCONSTRANS [urban Salvadoran µnion] on idents of new campesino organizations were other issues such as the type of surveys assassinated and I am informed that this needed, the proposed General Law of Agrar­ repressive practice continues to increase. ian Reform of June 1980, and the educa­ Recently, in one of the haciendas [farms] tional programs needed to develop in­ of the agrarian reform, uniformed members creased11 skills in the Agrarian.Reform Pro­ of the security forces accompanied by cess. 6 Cohen thus admits that the reform someone with a mask over his face, brought was U.S.-imposed with neglig,ible campesino the workers together; the masked man was input. The fact that AIFLD publicly por­ giving orders to the person in charge of trays the land reform as an indigenous the troops and these campesinos were Salvadoran program is hypocritical and un­ gunned down in front of their co-workers. derscores its illegitimacy.7 These bloody acts have been carried out by Bruce Cohen presents no criticism or uniformed members of the National Guard even questioning of a U.S.-imposed land and the Hacienda Police, accompanied b}; reform used as counterinsurgency in sup­ civilian members of ORDEN (death squadj, port of the junta. Flowing from this posi­ all heavily armed, including11 support from tion is· his incredulous attribution of all tanks and heavy equipment. 8 violence to "the left and the communists." The natural reaction to such associated Absolutely no violence is attributed to violence is the rejection of the program military, paramilitary, or rightwing by its own participants. In February 1981, forces. This operating principle alone to­ land reform head and UCS officer, Leonel tally discredits AIFLD 's l.and reform in El Gomez, fled El Salvador because of an as­ Salvador because it leaves no doubt about sasination attempt by the military in con­ AIFLD's unquestioning support of the mili­ junction with a civilian death squad.9 Upon arriving in the U.S., Gomez said that tary-dominated junta. 11 Further undermining the land reform's the "problem .•. is the army 10 in El Sal­ legitimacy is the fact that Cohen ignores vador. In another instance, the Executive violence directed toward its participants Council of eight UCS departmental organi­ which comes from the military and right­ zations participating in the land reform wing forces. Many first hand reports con­ signed a protest statement withdrawing tinue to verify the existence of this mil­ their support from the program.11 This itary and rightwing violence. Perhaps the withdrawal followed the machine-gunning of most telling testimony comes from Kssis­ twelve land reform participants by the Na­ 12 tant Minister of Agriculture, Jorge tional Guard . Alberto Villacorta upon his re&ignation A final telling indictment of AIFLD's on March 26, 1980. commitment, if not legitimacy, is Cohen's Counterspy -- Nov.Bl - Jan.82 -- 9

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AIFLD's consonance uJith the Reagan/Haig from their former owners to the 60,000 EZ SaZvador poUcy was evident in a· peasant :families who had been .working on guest speech to the March 1981 AIFLD them••.• A second reform program ••• (ll'ailu.ating cZass by Richard T. Booth, transferred to El Salvador's sharecrop­ Inter-American Labor Advisor in the U.S. pers and tenants all the land being State Department. Booth said about AIFLD worked by them, and it� brought� that "our gove:rnment fuUy supports our � immediate end the country's tradi­ Zabor movement in this effort. " On Ei tional landlord-tenant system•••• Farm­ land•.• passed into the de facto posses­ SaZvad.or, Boot.h said that "Secretary nl4 (Em- Haig has reiterated our support for the sion of about 150,000· families. gove:rnment Zed by President 'Duarte, in phasis added.) --.... Among those who �ispute Cohen's and its efforts to irrrpZement sweeping re­ forms." Booth's speech tt.'aS met with ap­ AIFLD's claims are former U.S. Ambassador p Zause. to El Salvador, Robert White who once in­ AIFLD Report, March-April 1981, p.2. vited Prosterman to promote the land re­ form before the Salvadoran oligarchy and revelation that U.S. AIFLD officials now the New York Times. The Times claimed on reside in Hondu,as and are accompanied by September 28, 1980 that the land reform an armed bodyguard. Since Cohen's draft is had "benef itted nearly one million peas­ a working paper and a justification for ants." In a September 1981 interview, continued funding, it means that AIFLD op­ White said that the "second stage of the erates as if there is no military or land reform had been explicitly canceled rightwing violence �en against land re­ with U.S. approval. And the powers that be form participants. Therefore, AIFLD's pub­ are refusing to accept the first phase of lic admissions of large scale military and land reform as a fait accompli - they want rightwing violence are all but meaningless to roll it back. "rs-- since. AIFLD does not act accordingly. In its August 3, 1981 edition, the Times While there is wide variance between reported that about 272 out of 282 land AIFLD's private and public statements on reform cooperatives were operating at a the issue of rightwing violence, there is loss. As opposed to Cohen's 62,000 fami­ one area of agreeme�t. Both say the land lies, the Times quotes AID as reporting only 38,0PO families participating in reform is a success. Cohen paints a rosy Phase I. Regarding Phase II, which Cohen picture: ". •• the Basic Law of Agrarian said benefitted 120,000 families, the Reform was promulgated in t-".arch 1980 and Times reported that "the United States Am­ farms of more than 1,200 acres were expro­ bassador, Deane R. Hinton, said recently priated•••• The takeover of these large that the second phase of the program would farms benefitted approxi. 62,000 families 11 16 and redistributes 615,000 acres to campe­ not be carried out. The third phase, or sino cooperatives. In April the Government land-to-the-tiller, according to AID, has approved Decree 207 or land to the tiller issued about 500 land titles "usually in ceremonies presided over by a member of El law. This law gives all renters and share­ 1117 croppers the rights to the land on which Salvador's governing junta. they work. By giving stability on the land William Doherty recently denied before to the 150,000 campesino families benefi­ Congress that AIFLD's land reform in El ciaried (sic) by the law•••• " Salvador was a "charade." He is correct. While admitting to bureaucratic impedi­ AIFLD's land reform is a brutal reality ments, Cohen gives the undeniable impres­ for the Salvadoran P,eople. sion that 212,000 families have already benefitted from the reform. AIFLD Execu­ FOOTNOTES tive Director, William C. Doherty, Jr. al­ so told Congress in February 1981 that 1) All references and quotations are from Bruce Cohen's ''over 210,000 families have received con­ draft report unless specified otherwise. The copy obtained trol over the land they till. 1113 That same by CounterSpy was missing the title page and a few other pages. Independent verifications were obtained confirming month, Doherty, citing Prosterman, wrote the validity of the draft and that its author is Cohen. the following: 2) Washington Post, l /4/80. 3) AFL'-CI0 Free Trade Union News, 6/80, p.4. "In March 1980, the 263 estates over 4) ibid., p-;-r:------1,250 acres in size were transferred 10 -- Counterspy -- Nov�Bl - Jan.82

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5) El Salvador Gazette, 5/5/80. As quoted in Agrarian Re­ 11) Wheaton, p.17. fomin El Salvador:A Program of Rural Pacification, by 12) ibid; see� Free Trade Union News, 2/81, p.4. PhilipWheaton, EPICA-Task Force (1470 Irving St. NW, 13) .As quoted in AIFLD Report, March-April 1981, p.1. Washington, D.C. 20010), 11/1/80, p.17. Regarding counter­ 14) AFL-CIO Free Trade Union News, 2/81, p.3. insur1ency, it is interesting to note that Cohen claims to 15) The Progressive, 9/81, p.23. have sent all copies of his report to Jesse Snyder, an 16) New York Times, 8/3/81, p.A-6. Agency for International Development (AID) officer sta­ 17) ibi.d�.-1-.- tioned in El Salvador. Snyder previously served in the CIA/AID/Pentagon counterinsurgency in Vietnam. 6) According to an AID memorandum of August 8, 1980: "It is closely identified in El Salvador with the U.S. Govern­ ment and the American Institute for Free Labor Development (AIFLD). Phas• III presents the most confusing aspeot of the reform program, and it could prove to be especially troublesome for the United States because it was decreed without advance discussion, except in very limited cir­ cles and we are told, it is considered by key Salvadoran offi�iala'as a misguided and U.S.-imposed initiative." (As quoted in Wheaton, p.16, see note 5.l 7) AIFLD's William Doherty is among those who claim that the laad reform is indigenous and directed toward the benefit of Salvadorans. At the same time, he has testified that there are "three parts" to the "Salvadoran problem." The first part, according to Doherty, is "the effect on U.S. national security of Communist aid to the guerrilla movements in El Salvador." (As quoted in � .!!,eport, March-April 1981, p.6.) 8) As quoted in: Wheaton, p.13 (see note 5). 9) Washington Star, 2/8/81, pp.A-1, A-11. 10) ibid., p.A-11. Cohen and AIFLD have also ignored Gomez' charge that government officials have taken $40 million in kickbacks from the land reform program.

U.S. Marshall Plan for the Caribbean: Counterinsurgency by Robert Holden

Money and guns: for more than eighty El Salvador. years, these have been the main instru­ Not since the rule of Salvador Allende's ments of U.S. foreign policy in Latin Popular Unity government in Chile from America. Shifts of emphasis, variations in 1970 to 1973 have �.S. interests been so approach and some amusing rhetorical gravely endangered in what Pentagon strat­ flourishes have broken the monotony from egists like to call our "southern flank." time to time, but the main objectives are Washington intervened materially to assist the old familiar ones: the exclusion of the overthrow of Allende, and is once "alien interests" and the maintenance of again positioning itself for an. interven­ an open door for U.S. trade and invest­ tion more dramatic than the mere transfer ment. U.S. capital's inexhaustible appe­ of arms and advisors. This time, the U.S. tite for fresh foreign investment opportu­ government's attention has been arrested nities has been matched by Washington's by the popular upsurge in Central Amerlca willingness to apply raw military power on against the oligarchies that have ruled on its behalf. The policy failed badly only Washington's behalf. once - in Cuba, an early victim of U.S. The response of the Reagan administra­ imperialism that finally excoriated the tion has been tc more than double the flow beast in 1959. Now, the policy is being of weaponry into Caribbean basin countries threatened again in Nicaragua, in Grenada, whose leaders are threatened by popular and on a different level i.n Guatemala and revolt, and to propose what has become known as a "mini-Marshall Plan." (All ref­ (Robert HoZden is a CZeveZand-based erences to the Caribbean basin, or the re­ jour>naZist.) gion, refer to the island nations, the countries of Central America not counting Counterspy -- Nov.81 - Jan.82 -- 11 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

Mexico, and to Colombia, Venezuela, Guyana ican Agribusiness Development Corporation, and Suriname on the South American S .A.l "We at AID," added John R. Bolton, coa�t.) AID general counsel, "are vigorous advo­ This fall, the administration will begin cates of supply side foreign assistance." consulting the leaders of industry and This openly nee-colonial strategy is , Congress to formulate a specific program being echoed at the World Bank which has for the so-called economic development, or proposed across-the-board currency devalu­ "MarsMll Plan" component of the Reagan ations, higher prices for basic goods and policy. By January 1982, according to the services, the elimination of trade re­ State Department's time- table, a second strictions, and private takeover of gov­ meeting of the United States and its des­ ernment-owned facilities as a way to es­ ignated partners in this effort - Mexico ' tablish· a· "social compact" in which "de­ Venezuela and Canada - will have taken veloping countries would agree to needed place to decide how the plan will be drawn economic changes in exchange for the prom­ up. As outlined by the administration, the ise of increased aid from the industrial United States will attempt to encourage would, both in bilateral �rants and cred­ development in t�e region by stressing the its from the World Bank." The United build-up of local private enterprise States is already implementing this poli­ (through U.S. aid as well as local govern­ cy at the Inter American Development Bank, ment initiative) , and the provision by the where the U.S. representative, in an "un­ recipient governments of further incen­ precedented" move, vetoed a $20 million tives for U.S. private investment and low-interest loan to Guyana because it trade. Mexico, Canada and Venezuela are would have supported government subsidies supposed to be developing separate plans to rice farmers.3 subject to some kind of coordination with Expanded military assistance to friendly Washington's. governments in the region is an insepara­ As described by Thomas O. Enders, Assis­ ble part of the Reagan "Marshall Plan." In tant Secretary of State for Inter-American his testimony before the House subcommit­ Affairs in testimony last July 28 before tee, Enders noted that, in addition to the the House Inter-American Affairs Subcom- economic strategy, "military and political . mittee, the plan will emphasize "the sup­ answers" are needed to "solve the security ply side ••• to create new competitive pro­ and political problems of the area." Unit­ duction capacity and take better advantage ed Nations Ambassador Jeane Kirkpatrick of [the basin'�] existing resources and has also called attention to the impor­ capital." So, Enders continued, "we will tance of granting military assistance in begin asking these countries as we meet tandem with so-called "development" aid.4 them: What can you do to retain your The increase in military aid in fiscal skilled labor and capital? How can you yea,r 1982 is colossal. Under the.Foreign create predictable, favorable conditions Military $ales program, the Pentagon has for enterprise? Such ideas as insurance been authorized to sell an estimated $50.7 against political risk for domestic as million worth of military articles in £is-. well as foreign investment, investment cal '8 2 to eleven countries: Barbad·os, Co­ treaties ensuring fair treatment, regional lombia, Costa Rica, Dominican Republic, El investment codes,1 and in general more fa- Salvador, Guatemala, Haiti, Honduras, Ja-­ vorable tax artd legal treatment for in- maica, Panama and Venezuela. This repre­ vestments should be considered." sents an incr.ease of 135 percent over 1980 Stephen L. Lande,. the Assistant U.S. sales to countries in the region, and a 96 Trade Representativ.e for Bilateral Af­ percent increase over 1981 sales. Funding fairs, told the committee that "the first for military training of the region's step is to identify the major impediments armed forces personnel will leap 178 per­ to private investment in the basin and in cent from fiscal '80 to fiscal '82, to a cooperation with the basin countries to total of $4.7 million. Licensed commercial try to devise approaches to remove these. sales of U.S. we apons are estimated to impediments." An official of the Agency rise 48 percent, to $25.3 million.5 .for International Development (AID) called At the same time, the U.S. Department of for major policy changes to stimulate Justice has permitted the training of production for export in the region, and counter-revolutionary exiles in bases in pointed to the example of the Latin Amer- Florida where they are openly preparing 12 -- Counterspy -- Nov.Bl - Jan.82 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

attacks on Cuba and Nicaragua in violation of the Neutrality Act.6 Recently, the Cu­ ban government announced the arrest of five counter-revolutionaries who landed on July 5, 1981 with weapons, explosives, and a plan to assassinate Fidel Castro.7 And when Secretary of State Alexander Haig accused the Soviet Union of stepping up arms deliveries to Cuba, the Wall Street Journal reported that "U.S. officials have said recently that a series of steps, in­ cluding some 'actions,' are planned for the near future to clarify U.S. policy to- ward Cuba. 118 Paziliacher Ozean What, precisely, are some of the inter­ ests at stake for U.S. corporations in the basin? They were plainly, if crudely, ex­ Lateinamerika Naahriahten pressed by President Reagan nine days af­ ter his inauguration. Responding to a news Panama Canal, .•. a significant proportion conference question about the election of of shipping bound to or from the South a conservative government in Jamaica, Atlantic and much of America's imported Reagan said: "And I think this opens the oil -- and a similar stake in the region door for us to .,have a policy in the Medi­ as a prime source for critical industrial terranean (sic) of bringing them back in raw materials. Because of the region's lo­ -- those countries that might have started cation, we have a stake in its use as a in that direction -- or keeping them in military basing point for U.S. installa­ the Western World, in the free world. And tions and -- perhaps even more -- as a po­ 112 so, we are looking forward to cooperate11 tential one for U.S. adversaries.1 with (Jamaican) Prime Minister Seaga. 9 The Caribbean holds about one-third of Two months later, a U.S. AID functionary all U.S. investment in Latin Americ�, or reminded the Senate Foreign Relations Com­ about $5 billion worth. Export-import mitt.ee that "The United States has vital trade with the region comes to $16 billion economic and security interests in Latin a.year. It is still the United States' America and the Caribbean," which together main source of bauxite, an ore needed to account for 77 percent of all U.S. invest­ produce aluminum. One-fourth of U.S. pe­ ment in the Third World. ''The continued troleum imports are refined or shipped health and growth of this large market is through the Caribbean,13 and U.S. and v'ital to our need to increase export Canadian oil companies are intensifying earnings ..• [A]nd the importance of foreign their search for oil in the region where sales to our income and employment is Guyana and Jamaica are said to be the likely to be even greater in the fu­ likeliest sources of rich deposits. Many ture.1110 of the Caribbean governments are offering At the Pentagon, a spokesperson justi­ highly favorable concessions to foreign fied the expanded U.S. military presence oil companies, including permission to re­ in the Caribbean (further described below) tain up to 70 percent of their profits,14 as a response to U.S. "strategic interests Jimmy Carter, of course, understood all and security threats. The two main securi­ of this as well as Ronald Reagan. Indeed, ty threats in the Caribbean are Cuban sup­ Carter should be claiming the credit for port of insurgent subversion in various initiating beth the "Marshall Plan" idea countries (by providing arms and training) and the stepped-up U.S. military pres-­ and the threat to our sea lanes of commu­ ence. In the fall of 1979, Carter's admin­ nication. 1111 istration revealed the existence of a mys­ The military stake in the region was al­ terious Soviet combat brigade in Cuba - a so outlined by Florida Congressman Dante revelation uninhibited by the prompt ac­ B. Fascell: "We have both a commercial and knowledgement of the Soviet Union that the a military stake in the Caribbean's sea brigade had been there since 1962.15 lanes -- through which travel•.• all the Carter used the presence of the brigade to naval and commercial vessels using the announce, in a dramatic and war-mongering Counte�Spy -- Nov.Bl - Jan.82 -- 13

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television address to .the nation on Octo­ a CBS interviewer that a blockade of Cuba ber 1, 1979 the following actions: was one way to-"show the Soviet Union how - More economic aid to Caribbean seriously we take this aggression of countries "to resist social turmoil and theirs" (in Afghanistan). Of course, he .possible communist domination." added, that was only a suggestion: "There - Expanded U.S. military maneuvers in, might even be .better options than that.1123 the Caribbean basin and surveillance of If successfully implemented, the Carter­ Cuba by U.S. intelligence agencies. Reagan plan to "help" the countries of the - The establisbment'of a permanent mili­ Caribbean basin will further reinforce tary headquarters on Key West, to be known their dependence on the United States ·­ as the Caribbean Joint Task Force.16 politically, economically and militarily. Five weeks later, in a message to Con­ These countries will continue to be at the gress, Carter proposed to "expand our sup­ mercy of the United States as their prin­ port for development and security in Cen­ cipal export market and price-setter for tral America and the Caribbean" by spend­ agricultural products (in a region where ing $175 million in the coming year on malnutrition is the main health problem) various economic assistance projects. He and raw materials of all kinds. As these added that, "We hope that other nations governments offer the required "incen­ and international institutions will in­ tives" to U.S. businesses, the living crease their efforts to accelerate the so­ standards of their people- - already af­ cial and economic development of Central flicted by rising unemployment and price America.n l7' The spendix,.g program had been inflation - will decline further, even as planned at least since the .....spring of 1979, more profits are shipped abroad, and as as the rebel forces in Nicaragua were the already stratospheric levels of exter­ gathering strength for their final victory nal debt skyrocket. The prices they get that summer. A Caribbean Gi:_oup for Cooper­ for their commodities will fluctuate un­ ation and Economic Development was formed predictably, but.the prices of imported by the United States and international goods, often including food, will climQ agencies, and several countries were higher. The resistance that all of this pledging to spend $275 million on the Ca­ will evoke among the people will be met by ribbean in 1980.18 the bullets that the U.S. government has As one consequence of the "Soviet bri­ thoughtfully provided to the authorities gade" scare, the annual military maneuvers on generous credit terms. In return for in the Atlantic and Caribbean were ex­ the unpleasant repression that the author­ panded. By 1981, the war games had become ities will be obliged to apply to keep the the "largest U.S. maritime exercise in re­ peace, the Reagan administration will de­ cent years," combining "a series of previ­ fend their behavior as necessary "authori­ ously scheduled exercises into a com- __ tarian" measures provbked by "totalitari­ pressed time period in order to provide an" Cuba and the Soviet Union. realistic and inte rated training in a war This is pretty much how U.S. foreign -at-sea scenario." f9 This year's Atlantic­ policy has always been: conducted in Latin Caribbean maneuver was called Ocean Ven­ America.' Ronald Reagan has merely restated ture 81, and the Caribbean phase took its premises more plainly, having inher­ · place fro� August 3 to August 20 under the ited a situation in which a new and more command of the Joint Task Force in Key promising level of popular resistance is West, with units from the Netherlands and taking shape. But like Jimmy Carter and the United Kingdom participating.20 The all the presidents before him, Ronald exercise sent 16,870 U.S. military person­ Reagan will never understand the lesson nel into the Caribbean on 12 ships and that has been demonstrated again and more than 100 aircraft.21 again in Asia, Africa and Latin America, This dangerous2l and provocative show especially in the last twenty years: The of force may have been Jimmy_ Carter's .struggle may be postponed, but it will idea, but it is also something Reagan never be defeated. clearly relishes as he showed by his de­ lighted response to the U.S. provocation FOOTNOTES:

over Libya's Gulf of Sidra in August 1981. l) Latin American Ag·ribusiness Development Cgrporation, S.A. Reagan's recklessness was evident early in is a Panamanian-registered corporation whose shares are al­ 1980, when the presidential candidate told moat entirely owned by 15 U,.S.-owned agribusiness multina- 14 -- CounterSpy -- Nov.Bl - Jan.82 Approved For Release 2010/06/15: CIA-RDP90-00845R.000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

tionals. It invests heavily in export-oriented ventures in The United States and Her Southern Neighbors," August 1981. Central America and the Caribbean. The company has received 13) Ibid., and see testimony of Willard Johnson on behalf AID loans of $16 million since it& founding in 1971. It of TransAfrica before the House Inter-American Affairs Sub­ pays no U.S. income tax because of its foreign registry and committee, 7/26/79. because its income is derived from foreign sources. 14) WSJ, 6/19/81. 2) \{all Street Journal (WSJ), 8/21/81, p.4. 15) NYT, 9/13/79, p.A-16. 3) Associated Press dispatch in The Plain Dealer (Cleveland} 16) F3cts on File, 10/5/79, pp.737-739. 8/15/81. 17) WeeklyCo�ation of Presidential Documents, 11/9/79. 4) Washington Post, 8/19/81, p.A-18. 18) cf supra, 016. 5) State Department: Congressional Presentation, Security 19) Pentagon news release No.344-81, 7/22/81. In correspon­ Assistance Programs, FY 1982. Commercial sales calculations dence to the author, a Pentagon spokesperson attributed the in the text exclude Panama because of an unusually large growth of the maneµvers to the increased size of th• Navy purchase of $29 million in 1980. and to "former President Carter's October 1, 1979 public an­ 6) New York Times (NYT), 3/17/81. nouncement of increased military presence in the Caribbean 7) Granma Resumen S�al, La Habana, 7/19/81, p.l. Basin." 8) WSJ, 7/31 /81. --- 20) ibid. 9) Weekly Compilation of Presidential Documents, Vol.17, 21) Correspondence, Pentagon Public Affairs Office spokes­ No.5, p.68. person to author. 10) U.S. Agency for International Development, prepared 22) The Navy "accidentally" fired a live missile while statement of Edward W. Coy, acting assistant administrator crusing 1n the Caribbean in July. The missile, which appar­ for Latin America and the Caribbean, 4/2/81. ently failed to hit anything, contained 215 pounds of explo­ 11) Correspondence, Pentagon Public Affairs Office spokes­ sives and had a range of 60 miles. See -WSJ, 7/16/81. person to author. 23) Facts� File, 2/8/80. 12) Mimeographed manuscript, "Challenge in the Caribbean:

Reagan Resurrects Savimbi by Konrad Ege

At the same time as well over ten thou­ sion was to strengtben UNITA; in addition, sand South African. troops -.,.·ere carrying it hoped to destabilize the Angolan MFLA out a major invasion of Angola, and a few government, and to weaken SWAPC militari­ days before a South African motorized col­ ly. The invasion apparently was one more umn advanced into southeastern Angola with Kinshasa the aim of restocking supply dumps of UNITA troops,1 U.S. Assistant Secretary of State Chester Crocker told a Hawaii audi­ Nl ence that "lTNITA represents a s:i.gnif icant and legitimate factor in Ar.\gclan ·:-.i.:::!.- 11 Luanda • Ca,;10 tics. 2 UNITA (National Union for the Tc­ ANGOLA tal Independence of Angola), h�.aded by �ussende Jonas Savimbi is, of course, the very or­ ' Calucmga ganization aided in its fight against the �anta.Comha .Loso Angolan government by South African troops Lob,10 Cela Nort�n •Sliva Porto Benquela de Malos, O"" during their invasion. • Huambo�'-.,, Cuhal (Nova � PNITA, which re-grouped with·c-utside as­ L,shoa) .t..19,.. sistance after suffering tr,ilitary defeat Sa da Bandeira • Ka5.s1nga • Serpa Pinto ZAMBIA by the MPLA (Y...ovement for tht•. Liberation Joao de• Almeida of Angola) in 197 6, has again emerge<:! as a crucial component in the South African •Ng,va (Pereira d'Ecal strategy to defeat the South West African Oshikango Organization' : People's a (S�APO) struggle Ondangua for the liberaticn of South African-occu­ Atlantic pied ��axr.ibia. One of the main goals of Ocean 1981 Gr. ootfontein BOTSWANA South Africa's August-September inva- NAMIBIA (Konrad Ege is eo-edit0'1.' cf CcunterSpy and a freeZan.ee journatiet.) International T:efen

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 step in a South African strategy to create tions, according to Duignan, South African a "buffer zone" along the Angolan-Namibian troops would remain in Namibia, and only border which, at least for the near fu­ after "an independent Namibia is in a po­ ture,-would impede SWAPO's military opera­ sition to defend itself, and once guerril­ tions. UNI TA is an "ideal" force to occupy la warfare has stopped, South African this buffer zone. troop� will be able to leave the coun­ In order to clear the way for UNITA, try."4 South Africa is carrying out a brutal war As of now, the Reagan administration is against the people of southern Angola. still maintaining that it is determined to Sara Rodrigues, the Luanda corresponde�t find a Namibia solution within a United of the Guardian (New York) wrote: "Preto­ Nations framework. However, while these ria seems determined_to leave nothing but statements are being made, South Africa is scorched, blackened earth, as it contin­ on its way to create militarily certain ues its brutal invasion of Angola •••• The realities in Angola and Namibia. Even brunt of the South African action is in­ though the most recent South African inva­ tended to wipe out the civilian popula­ sions stand in stark contrast to working tion. Villagers are being mown down; wa­ toward a peaceful solution to the "Namibia terholes.•• occupied or sabotaged ••• ; problem" which the Reagan administration crops and homes burned to the ground; claims to be committed to, there has been food stores raided and destroyed; and no visible effort by the U.S. government cattle ••. driven across into Namibia or to prevent South Africa from further mili­ slaughtered with automatic weapons . .,3 tary actions. This silence or acquiescence The Reagan administration, whose stron­ is taken as support by the South African gest response after weeks of continued regime. South African aggression was to "deplore" the violence, vetoed a United Nations Se­ SAVIMBI: TREASON SINCE 1972 curity Council resolution condemning the I invasion. That decision gives rise to Jonas Savimbi plays an. important role in speculation about what the U.S. government the South African strategy, and South Af­ hopes to gain from the invasion. The cre­ rica appears ,c0mmitted to strengthen UNITA ation of a "buffer zone" might give South to prepare it for an extended role. At the Africa and the . U.S. an opportunity to same time, the Reagan administration is "settle the Namibia problem" in a way that pushing Congress. to repeal the Clark will preserve South African military domi­ amendment prohibiting U.S. aid to UNITA� nance over the country but will also pro­ Both the U.S. and South Africa1 �ere ardent vide a justification for Western govern­ supporters of U'NITA 1 during MPLA's libera- ments and South Afrtca to recognize the tion war in Angola against Portuguese co- "government" of Namibia and to argue that lonialism. Since 1972, UKITA has served SWAPO's claims have lost, their validity. pro-Western interests. Savimbi collaborat­ A "Namibia e.olution" excluding SWAPO ed not only with the South Africar. re­ which would benefit from such a buffer gime but also with the Portuguese colonial zone was outlined in 1977 by Peter army - which was supposed to be his en�l!'Y• Duignan, Director of the African Program Former Portuguese dictator Marcello at the Hoover Institution in Stanford, Caetano himself acknowledged that in 1972 California. Duj_gnan, who was a member of the Portuguese occupiers struck1 a deal Reagan's transition team and has consider­ with Savimbi whereby they wou ,

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day, UNITA is receiving weapons, fuel, France .was providing "millions" for medical care, training and actual combat UNITA.11 At least officially, French aid assistance from South Africa. This was to UNITA now has ceased. After the Angolan confirmed by a number of mercenaries government suspended all French oil pros- fighting for South Africa, including Jose pecting in Angola, France was forced to Ricardo Belmundo, an Angolan fighting in sign an agreement in September 1978 in South Africa's "32 Battalion." He ex- , which France pledged to halt all aid to plained the task of this elite unit: Angolan counter�revolutionaries. "Whenever UNITA had operational difficul- West Germany's Franz Josef Strauss, head ties it would contact South African mili- of the rightwing Christian Social Union tary security, which would call on 3 2 Bat- refers to Savimbi as a good friend, and talion to •.• get UNITA out of trouble. We has been accused in a report by Angola's would operate on behalf of UNITA in UNITA Paris embassy of being instrumental in regions." According to Belmundo, who tes- funneling arms to UNITA.12 The Hanns- tified before the International Commis- Seidel-Stiftung, a foundation with close sion of Inquiry into the Crimes of the ties to the Christian Social Union has Racist and Apartheid Regimes in Southern provided substantial quantities of medi- Africa in early 1981, "the 32 Battalion cine to UNITA, according to Savimbi him- was made to appear like UNITA. We carried self. Chinese-made AK.'s .••. " The existence of 32 Savimbi also seems to work through a va- Battalion has been confirmed by Colonel riety of channels to obtain arms on the Leon Martins of the South African Army. 6 international market. One such deal, worth While South Africa's support for UNITA an estimated $1.2 million was uncovered in is certainly the largest aid program to early May 1981 in Houston, Texas when cus- Savim.bi, other countries have provided him toms officia:is arrested t:n::1:e Britons and with assistance. Morocco's King Hassan, three Austrians and seized a planeload of himself a recipient of one of the largest some 1,3 00 guns, 100 grenade launchers and U.S. military ass,istance programs in Afri- about one million rounds of ammunition. ca, has emerged as a,close UNITA ally. The arms shipment, which involved the About 500 UNITA troops recently went Liechtenstein and Hamburg, West Germany- through long periods of training by Moroc- based Servotech Company, Austria's Montana co's U.S.-advised and equipped army.7 (In Airlines, and South Africa's Armscor, was return, Hassan gets South African weapons destined for South Africa, but the London for his war in the Western Sahara, and Observer made clear that its real destina- South African advisors are reportedly tion could have only been Savimbi' s training Moroccan soldieri.8) Another DNITA. 13 close African ally is Senegal, which pro- In the U.S., there are a number of vides Savimbi with weapons. UNITA also rightwing organizations which have taken maintains an office in Dakar, Senegal for up Savimbi's cause. In early 1981 there arranging arms deals.9 Other donors to were rumors that Savimbi was to come to UNITA are the governments of Ivory Coast, the U.S. for talks with Reagan administra- Qatar and Saudi Arabia. , ':.ion officials. At least publicly, the Savimbi's European contacts include the visit never took place, possibly because party of former Portuguese Prime Minister there was already consideral:le public op­ Sa Carneiro. The rightwing Portuguese mag- position to visits by Dirk Mudge, the head azine A Rua commented that Savimbi's for- of the South African-installed government mer ties to the fascist Portuguese intel- of Namibia, and by South African Foreign ligence PIDE/DGS are "the best recommenda- Minister Pik Botha. How�ver, then-Acting tions" Savimbi can provide.10 Assistant Secretary of State Lannon Walker The right wing of Margaret Thatcher's met with Savimbi in Xorocco in March 1981, Conservative Party has good relations with and Jeremias Chitun

Approved For !3:elease 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 be the first time that Western trade UNITA; and unions aided counter-revolutionaries in WHEREAS, PrincipaZ wishes to promote the Angola. In 1978 it was revealed that the economic, industrial and agricultural de­ International Confederation of Free Trade velopment of AngoZa by and through the UniofB' a labor center "set up ••• by the granting of concessions for such develop­ CI_A" was giving money to Holden ment; and Roberto's "Angolan General League of WHEREAS, Agent is knou.1ZedgeabZe of the Workers" which was all but a front for the various economic, industric..Z, mineral, and FNLA.) agricultural depos:J'"its and uses irn and of 'Angola; and LOBBYING FOR SAVIMBI WHEREAS, Prinaipal is presently engaged in an amed confl,ict to determine the gov­ To get favorable press coverage, Savimbi.s. ernment of AngoZa, which occupies the pri­ maintains paid propagandists in the U macy portion of PrinaipaZ 's time and ac-. One of them is Florence Tate, former press tivities. secretary of Washington, D.C. mayor, NOW, THEREFORE, Principal hereby ap­ Marion Barry. Tate, president of Florence points PAUL K. KOERNER •.. as the sole Eco­ Tate Associates, began working for UNITA nomic Agent of Principal in North America. in April 1980 for an annual fee of $65,000 · • • • The duties of sa-id Agent ehaZZ be to plus expenses. She described her political promote the Principal's granting of eco­ activities on behalf of UNITA as "lobbying nomic concessions in the Country of Angola ••• to deter the diplomatic recognition of to VaI'ious persons, individual and aorpo­ the Luanda regime and to persuade ••• U.S. rate. government policy makers to support As this agreement shows, Savimbi has UNITA." Her tasks, according to a state­ far-reaching plans. However, in spite of ment filed with the Justice Department un­ strong South African backing, it would be der the Foreign Agents Registration Act virtually impossible for UNITA to over­ include: "Write pro-UNITA letters-to-the- throw the MPLA government. Its popular editor •••, disseminate pro-UNITA news backing and support from socialist and clips •.• [and] arrange public speaking en­ progressive countries is too strong. Even gagements for UNITA representatives.'' Tate so, the next months might be crucial as also does some speaking herself to "small South Africa seems prepared to create a selected groups of church and labor offi­ "country" for Savimbi in southern Angola cials, Black organizations, and congres­ by its invasions. Now more than ever, the sional staffs." She maintains contact with Angolan people who have remained constant the Voice of America to "seize any avail­ in their total support for the liberation able opportunity to present political movement in Namibia, in spite of repeated views of Americans that are favorable to South African invasions, need and deserve UNITA's cause" and tries to ''maintain good international support. personal relations with press, through ju­ dicious use of news tips ••••" Finally, her FOOTNOTES: work includes arranging ''for selected journalists to visit UNITA areas inside 1) see Baltimore Sun, 9/4/81, p,A-2. Angola." 2) Address by Chester Crocker before the Foreign Relations and National Security Committees of the American Legion, Another paid U.S. propagandist for UNITA Honolulu, Hawaii, 8/29/81. is Paul Koerner, a member of the Board of 3) The Guardian (New York), 8/26/81, p.10. 4) Peter Duignan, L,H. Gann, South West Africa-Namibia, Directors of the St. Louis, Missouri-based American-African Affairs Association, Inc., New York, 1977, Strategic Resource.Information Service. p.36. 5) The letter is part of a series of letters between According to an October 28, 1980 agreement Savi.mbi and Portuguese government officials. They were pub­ signed by Koerner and Jeremias Chitunda, lished first by the Paris Afrique-Asie magazine on 7/8/74. Koerner is "the sole Economic Agent" of 6) West Africa (London), 3/9/81, p.493, 7) Washi�Post, 7/22/81, p.A-15. UNITA in North America. The agreement 8) Africa (London), 4/81, p,61; The Nation, 12/20/80, reads, in part ("Principal" is ONITA, pp.664,665. -. -- 9) see Die Welt, 1/31/79, Informationsdienst Suedliches Af­ "Agent" is Koerner): rika, 10/80�16. 'WHEREAS, PrincipaZ cZaims to be the Ze­ 10) as quoted in Antiimperialistisches Informationsbulle­ gitimate representative of the people of tin, 11-12/80, p.7 the Countcy of AY'-{;'OZa, Africa, and the IT) Harper's, 9/78, p.22, CentraZ Corrmittee is the governing body of (cont. on pa9e 59) Counterspy -- Nov.Bl - Jan.82 -- 19

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The contours of a high-level Reagan ad­ Cuba, Angola, Afghanistan and Vietnam - ministration plan to destabilize Libya are has already been targeted by policy plan­ starting to shine through the curtain of ners for an intensified campaign of propa­ government secrecy. In August 1981, Don ganda, isolation and destabilization. The Oberdorfer of the Washington Post reported issue for the Reagan administration, in that the first "interdepartmental foreign Libya's case as in the others, is not policy study" ordered by the Reagan admin­ whether to carry out the campaign, but istration shortly after taking office con­ rather how extensive the campaign can be, sidered what the U.S. should do "to oppose given inherent constraints and the dangers Libya and its militant ••. leader, Col. of public exposure. Muammar Qaddafi." A few months later, Oberdorf er continued, "authoritative I. CIA IN AFRICA: HUGEL'S BRIEFING AND ITS sources reported that the administration AFTERMATH had drawn up plans to 'make life uncom­ fortable,' at. a minimum," for Qaddafi. 1 On July 25, 1981 Michael Getler reported Details of these plans are beginning to in the Washington Post that members of the emerge because of. intentional and acciden­ House Select Committee on Intelligence tal leaks (some of which are disinforma­ had· written to President Reagan "object:­ tion) and because of the controversy sur­ ing to a Central Intelligence Agency plan rounding Max Hugel, formerly in charge of for a covert action operation in Africa, CIA covert operations, and CIA Uirector according to informed sources·." Getler's William Casey; and as a result of the air sources added that several Intelligence engagement between U.S. and Libyan fighter Committee members, both Republicans and pilots over the Gulf of Sidra. Democrats, were "troubled by the plan it­ There is even some evidence ·that the self, which they felt was not properly Casey affair was, in fact, an intergovern­ thought through, and the proposed secret mental struggle over the wisdom of initi­ action." They also said that Max Hugel ating certain covert operations against and Herman J. Cohen (Deputy Assistant Sec­ Libya. But whether this is true or not, it retary for Intelligence and Research at has become quite clear that Libya - like the State Department) first briefed com� mittee members on the plan and "misgivings Algiers about the plan were voiced to Hugel and Cohen." The letter was written because committee members were not confident that ALGERIA their objections would reach Casey and . President Reagan. Three explanations have been offered for this lack of confidence. ,former CIA Direc­ tor Stansfield Turner often briefed the congressional oversight· committees him­ self; William Casey did not, but instead NIGER delegated this responsibility to Hugel, or Khartouma to his deputy Bobby Ray Inman. A second CHAD explanation was that Hugel was thought in­ competent, and the third was that the plan was thought to be so "harebrained" that (Jeff McConnell is a politiaaZ activist Committee living in Cambridge, Massachusetts.) members raised questions about 20 Counterspy -- Nov.Bl - Jan.82 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

4 Hu.gel's judgement, and about Casey's as funds. welL 2 Whatever the explanation, .the In­ telligence Committee letter was a "highly 11. DENIALS AND COUNTER-DENIALS unusual" move. Reportedly, it was the first time in the four years since the On July 2 7 the White House explicitly House committee was established that its denied aspects of the Newsweek story. The members put their views on a CIA covert White House deputy press secretary, Larry operation in writing to the president.3 Speakes, stated: "The briefing described

Both the White House and the Intelligence by Max Hugel (sic) in the current11 issue of Committee confirmed that the letter had Newsweek never took place. 5 He also said been written and sent. that Newsweek "is incorrect .• The· letter11 Soon thereafter Newsweek magazine re­ did not concern Libya or Qaddafi. 6 ported that the target of the covert ac­ Speakes declined to provide more informa­ tion discussed in the letter was Libya. tion, saying: "We don't go into the b�si­ The aim was to overthrow Qaddafi - that ness of discussing our intelligence." But is, according to Newsweek's sources, even his limited remarks were a departure Qaddafi's "'ultimate removal' from power." from the White House's usual "no-comment" To members of the House Intelligence Com­ policy,and the Washington Post suggests it mittee who reviewed the plan "that phrase was "an apparent effort to assist belea­ seemed to imply [Qaddafi's] assassination guered CIA Director William Casey." Most ..•. Casey nevertheless denied that the papers reported that the White House, and CIA planned to kill [Qaddafi� - but the some that Senator Howard Baker (him§elf on committee, one source said, just doesn't the Senate Intelligence Committee), had trust Casey' and fired off its protest." "denied" the Newsweek story, but few re­ Newsweek characterized the action as "a ported the actual content of the denials classic CIA destabilization campaign" with or the important fact that Speakes' re­ three elements. One element was a disin­ marks conflicted with only aspects of the formation campaign designed to embarrass story. Qaddafi. Another was the creation of a The next day the Washington Post report-• "counter government" to challenge his ed that unnamed "administration sources" claim to leadership. A third element - po­ had said on July 2 7 that it was Mauritania tentially the most risky - was an "esca­ and not Libya that was the subject of the lating paramilitary campaign, probably by House Intelligence Committee letter. On disaffected Libyan nationals, to blow up July 29, the Christian Science Monitor re­ bridges, conduct small-scale guerrilla op­ ported in an unsigned article that despite erations and demonstrate that (Qaddafi] the public controversy over Casey's busi­ was opposed by an indigenous political ness practices, the "real reason" that force." members of Congress wanted him to resign Newsweek did not reveal whether Hugel was his approval of the Mauritania plan. outlined to the committee a campaign al­ The plan "raised in congressional minds a ready in progress or a campaign yet to be­ question of judgement." The House Intelli­ gin. But it is known that various opera­ gence Committee didn't consider Mauritania tions such as those purportedly described a country of "major importance•... It re­ by Hugel and Cohen have already been car­ cently went through a political coup as a ried out against Libya. What is not pub� result of which i.t shifted its association licly known is the extent of V.S. involve­ from Morocco ..• to Libya .••• It might be ment in such operations and the extent of desirable to help out King Hassan of Mo­ their coordination. Such actions do not rocco... , but119 is it worth a serious covert require congressional approval but only a operation? finding by the president that they are Three weeks later, Michael Getler re­ needed for "national security," and thus ported that hours after the story on CIA they could have begun before the briefing. covert operations in Mauritania appeared, On the other hand, Newsweek reported that the Mauritanians "went up the wall" and the cost of some aspects of the CIA cam­ demanded explanations from the State De­ paign was so high that the CIA needed con­ partment. The Reagan administration dealt gressional approval to draw funds from a with this problem in two different ways: special reserve account. As of late July, "At first U.S. officials tried to tell Congre�s reportedly has not approved the Mauritania that they could not discuss al- CounterSpy -- Nov.Bl - Jan.82 -- 21 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 leged or real covert actions; then they tion's concern about Mr. Qaddafi is so great tried to convince them that the press ac­ that key congressmen have been count was wrong:" Getler then cites "in­ briefed on a covert U.S. operation planned formed sources" as saying that the CIA to check Libyan influence in Mauritius, an target was not Mauritania but Mauritius, island in the Indian Ocean that the U.S. and that "the plan involving Mauritius did £eared could become a Soviet naval base." not involve cloak-and-dagger action but Significantly, however, House's piece did was mainly a quiet CIA effort to slip mon­ not appear until August 4, one week after ey to the government there to help coun­ the original Mauritania reports; moreover, teract financial aid being supplied to she did not connect the Mauritius opera­ forces opposing the government by ••• tion at all to the committee letter.11 If Muammar Qaddafi." Getler did not report, the Journal did write it correctly, it however, on how this money was to accom­ seems to have done so inadvertently. plish its task, or why such an operation Time magazine, at about the same time as would provoke as strong a response as the House's article was printed, claimed that committee's letter to the White House. it, too, had been told of a CIA plot On the other hand, Getler drew attention "aimed at the 'u ltimate' removal" of to a piece by Karen Eliot House in the Qaddafi but bad "concluded that the report Wall Street Journal concerning Egyptian was untrue;" and that certain "CIA President Anwar Sadat's then forthcoming sources" had fed this "disinformation" to Newsweek. Time charged that "CIA sources" visit to thr U.s.lO In a passing remark, House had written that the "administra- were behind the Mauritania story also, but Mauritania ? Mauritius ?? AZ.most immediately after "sourees" toZd in iron ore, phosphates (mainZy used for Newsweek magazine that the CIA was pZan­ fertitizer) and possibty in oil and urani­ ning the "ultimate removaZ" of Libyan head um. Tensions between Mauritania and Moroe­ of state Muammar Qaddafi, other Reagan ad­ ao have been running high since it signed ministration sourees Z.eaked information a peace treaty with the PoZisario Libera­ indieating that the CIA's target of a co­ tion Front in 1979. (Morocco aontinues to vert operation was not Libya but another use U.S.-supptied weapons in its war North Afriean country, Mauritania. In its against the PoZisario over the Western Sa­ August 10 issue, Newsweek foZ.Zowed that up hara. The Potisa.rio has been reeognized by with yet another leak: "Reagan adminis­ the majority of the Organization of Afri­ tration offieials eoncede that a seeond ean Unity member countries.) Strategy Week operation is planned, not for Mauritania, reported in Juty 1980 that French inteZZi­ but for another undisclosed Third WorZd gence had pZans to stage a coup ousting eountry." FinaZZ.y, the Washington Post ha.d Mauritania's government whieh they p.er­ the deeisive word: There had been a mix-up aeived to be too aZoseZy aZigned with AZ­ between two similar-sounding names: Mauri­ geria, Libya and the Potisario. Franae, tania and Mauritius, an island nation in aZong with Morocao, and, untiZ reaentZy, the Indian Oeean. Mauritius now was the Mauritania's southern neighbor Senegal, CIA target, and the CIA was rumored to be harbored Mauritanian opposition forces and pZ -annin'g to fund a pro-V. S. Mauritian par­ gave them room for poZitiaal maneuvers. ty for the upeoming eZ.eetions, seheduZed On Marah 16� 1981 the so-eaZZed '�Z­ for Z.ate 1981 or earZy 1982. Zianae for a Democratie Mauritania" (ADM) Whieh Z.eak or rumor about a CIA eovert staged an unsuacessfuZ aoup against Mauri­ operation wiZZ. turn out to be true remains tania's President Khouna Ould HaydaZla. an open question as of this writing. How­ The rebets came over-Zand from Senegal ever, both Mauritania and Mauritius have across a border tightZy aontroZZed by that been the targets of Western covert opera­ country's security forees, and, according tions within the last year. And there are to §._Days (London), tuere counting on Mo­ good reasons - from the CIA's perspective - roccan assistance in the second stage of to step up aovert operations in both the coup after capturing leading members eountries. of the gove:rnment. 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that what the House committee had objected Newsweek claimed that a "second operation to was "a much broader, proposed CIA oper­ was planned for another Third World nation ation - one that did not involve physical as well. It was not Mauritania, adminis­ attacks on any national leader - to shore tration aides later conceded." Newsweek up U.S. interests in the Middle East and also acknowledged that: "When a majority North Africa." However, according to one of the committee protested to the Presi­ senator, this was a "hasty scheme," and dent about the plan, most had the second Senator Barry Goldwater felt he "just operation in mind, though some thought the couldn't stand watching a bunch of ama­ letter they signed referred to Libya.1113 teurs running things." Goldwater thereaf­ This acknowledgement indicates that, con­ ter called for Casey's resignation. When trary to Newsweek's original story, the Casey later testified on his own behalf to House committee's letter may well have not the Senate Intelligence Committee, Time referred explicitly to any particular co­ reported, members were "less interested in vert operation at all. his business practices than his leadership About two weeks later, Getler's report of the CIA."12 appeared, attributing to "informed Newsweek defended its original story and sources" the information that the contro­ reported that "White House officials" had versial CIA target was Mauritius. Later, tried to help Casey by denying the Libya in its August 31 issue reporting or:. the story and by putting out word that Mauri­ Gulf of Sidra incident, Newsweek discussed tania was the target country. In addition, Qaddafi's "undeclared war" against "Ameri-

not in the capital Nouakchott at the time Berenger, is very likely to win the upcom­ of the coup. (According to a high-ranking ing etectt'.on. The MMM is committed to a Libyan official quoted in al-Qabas (Ku­ demiZitaPization of the Indian Ocean re­ wait) ., Libya had provide]. intelligence gion, and has been active on ·behalf cf the about the coup to the Mauritanian govern­ former residents of Diego Garcia since ment in advance.) Both Morocco and Senegal they 1.,.,ere expelled in the wake of the U.S. have stated that they were in no way in­ takeover and enlargement of the military volved in the coup ., cut Morocco's support facilities there. for the ADM is no secret., and Senegal On the economic side, the MMM wants to closed ADM offices in Dakar only after the take control cut of the hands of a small embarrassment of r.ai,ing the failed coup elite which controls Maw•itius' export and attempt stc,ged from their country. tourisrr.-based eaor,,omy. In fact, Mauritius The situation in Mauritius., from the CIA's point of view, is even more ripe fer is in very bad economic sh.a'(:e 1.,;ith cne cf intervention. According to Reger Faligot the highest inflation rates in Africa. Its �rriting in Bulletin d'Information sur foreign debts to the Internatior:.al Mone­ l'Inter-vention Clandestine (Paris), the tary Fur.d and international banks are CIA has recently stepped up its actii:ities staggering, and Mauriti.us' eC'onomy has be­ come dependent en South Africa. In March on the island under CIA Chief of Station 1981, Jeff Corydon. The aim cf the CIA - as well for example, P1:>ime Minister as of British and South African intelli­ RamgooZam accepted a $187 miZZion loan gence agenciee - in Mauritius is to pre­ from South Africa. This economic hold over the island has vent an election victory by the Mouvemer.t MiUtant Mauritien (MMM) against F-rime given tr.e South African regime consider­ Minister- Seeu.loosagur RamgcoZam. The stakes able leverage in Mauritius' politics. South Africa is financing opponents of the are high: Port Louis., Mauritius is an im­ portant pert fer the U.S. Indian Ocean na­ MM/1., most notable the small, extreme val task force and the French Navy; both x•ightt.,,-ing Mauritian Social Democratic the l!. 8. National Seeuri.ty Agency (NSA) Party. As far as U.S. intervention is con­ ar.d the British Government Communications cerned, Carter administration officials, Headquarters (GCHQ) �aintain intelligence according to Berenger, promised not to in­ fac1.:Uties on Mauriti.us, and, above aU, terfere in Mauritius' elections. Roger Mauritius is the legal OlJner of Diego Fatigot's article and recent revelations in the Washington PostJ however, strongly Garcia, the most important U.S. nai•al base indicate that this "promise" has been bro­ in the Indian Ocean. It is generally ac­ ken. The stakes for the U.S. might just be knowledged tr,,a,t the MMM, Z.ed by Paul too high. Counterspy -- Nov.Bl - Jan.82 -- 23

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 fo:pproved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 can interests" as background to the inci­ and the U.S. public's. And some may have dent. It reported that the Reagan adminis­ also be�n more threats or bluffs than con­ tration "ts determined to put pressure" on crete plans_. For example, the U.S. naval Qaddafi "in a variety of ways," which in­ operation in the Gulf of Sidra was widely clude "asking friendly nations to help the reported, both before and after the air United States isolate and condemn" engagement, to fill both these functions Qaddafi, "propping up Libya's neighbors," of test and threat. But at the same time and "unleashing the CIA." Newsweek now that Qaddafi was tested, the American pub­ characterized the proposed CIA operation lic was tested, too, over the ex�ent that with a slightly different emphasis: it in­ the U.S. government has succeeded in over­ volves not the "hasty scheme" Time report­ coming post-Vietnam opposition to military ed but rather a "patient" plan-:-One to action. As former CIA analyst Joseph Sisco "destabilize and ultimately overthrow" approvingly wrote just after the Gulf of Qaddafi, but because of his "firm hold on Sidra incident, military actions are now power'' and the unavailability of a "sub­ possible to the extent they are packaged stantial political counterforce" in Libya as necessary to national interests or na­ for the CIA to work with, the "Reagan ap­ tional honor.15 Thus the Reagan adminis­ proach," with memorieij of the Bay of Pigs tration has a clear interest in leaking "fiasco" in mind, is to "start with a low­ reports of covert action to condition the key, nonviolent effott to recruit reliable public to accept an increasingly broad agents from within the Libyan exile commu­ conception of· "national interests." nity and begin the slow, tedious task of The details of the White House denial building a viable opposition" to are important. Speakes denied that the Qaddafi.14 Again there was no mention of briefing described� Newsweek had oc­ plans for assassination. curred; he did not deny that Hugel had ev­ er briefed the House committee. This was a III. INFORMATION AND DISINFORMATION very weak statement; it only said that no briefing completely matching the descrip­ It is important to pay close attention tion by Newsweek ever took place. (The ex­ to all the details of 'these many reports. act meaning of Speakes' denial was probab­ There is surely much di�information here, ly that the U.S. had no plans to assassi­ but even such disinformation can be infor­ nate Qaddafi - a denial which had been mative. Some sources believe that there made numerous times before. This is likely were CIA people out to get Casey by feed­ since the focus of Newsweek's article was ing the press disinformation about covert the allegation of an assassination plot.) operations; Time was most explicit about Moreover, Speakes' claim that the House this. Casey was politicizing the analysis Intelligence Committee letter was not of intelligence to suit the government's about Libya or Qaddafi is consistent with cold war posturing; he was appointing peo­ its being about many kinds of operations ple like Hugel; he was approving "bizarre" On that involved Libya or Qaddafi in some covert actions. This made him enemies. way; the alleged Mauritius operation, for the other hand, the White House, and per­ instance, would involve Libya even if a haps other factions in the CIA, had an in­ letter protesting it would not be about terest in both defending Casey against em­ Libya. A number of covert operatio�s could barrassment and in covering up the details hide beneath the semantic cover of of covert operations. The White House also Speakes' phrase. was interested in settling at least one There are several points of agreement diplomatic flap caused by the embarrassing among the later press reports. The leaked 1 revelations about CIA operations. Ahd var­ House Intelligence Committee letter was ious congresspersons were interested in inexplicit enougo to cause c0nfusion about either covering up for Casey or in enlist­ its precise subject. Libya was somehow in­ ing the media in their campaign against volved. The Time and the later Newsweek Casey and his "hasty scheme." reports are consistent: a number of opera­ Finally, however, the Reagan administra­ tions were discussed in \:he House brief­ tion has an undeniable interest in intimi­ ing; apparently; all focused on Africa and dating and testing Qaddafi, and there is a the Middle East, probably all with coordi­ possibility that some of the stories were nated objectives. Both t�e planning and trial balloons to gauge Qaddafi's reaction the operations themselve-s seem to have 24 -- Counterspy -- Nov.Bl - Jan.82

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been objected to in the letter. armed forces of underdeveloped countries There is much other evidence that helps as a major 'transmission belt' of socio­ in appraising these reports that comes economic reform and development." In many from the history of U.S.-Libyan relations of these countries, the authors main­ and from a number of current developments. tained, "the military, as dynamic agents U.S. covert operations have been taking of social and economic reform represent .an place in Libya for a long time. It is effective alternative to Communist extrem­ thus useful to examine their history and ism." As such, it "should receive the full the history of U.S. objectives the�e to support and encouragement of American eco­ understand what factors are currently mo­ nomic and m�litary assistance planners." tivating planners: many of the strategic Moreover, "the organizational strength of issues and the constraints have changed t,he Communist parties, their unity of pur­ little. pose and the dedication and loyalty of In many cases, roles have changed re­ their leaders, are rarely matched by simi­ cently. The French, under Valery Giscard lar attributes among the democratic d'Estaing took over covert operations in parties •••• Communism may overrun these Libya while Jimmy Carter was in: office as critical areas of the world unless a po­ part of their aggressive Africa policy. litical and social counterforce, well or­ Ronald Reagan has now taken over there the ganized ••• and dedicated to common goals French objectives and tactics, both be­ is developed." A,ccording to "Annex C," it cause of Giscard's loss to Mitterrand and is becoming' "increasingly evident that the France's consequent change in policy to­ military officer corps is a major rallying ward the Third World and because of the 7 point of the defense against Communist ex­ increasingly aggressive U.S. foreign poli­ pansion and penetration." The corps can be cy. It is thus also important to examine involved in "providing stable and effi­ the history of these operations in the cient government," in "improving the in-: 197Os to see what strategies Reagan's CIA ternal security," and in making more ef­ is likely to adopt. Finally it is useful fective use "of their nations' economic to look in detail at various contemporary resources and foreign economic assis­ developments to see if any picture emerges tance.''17 of ongoing CIA activities that supports A CIA study prepared for the Draper Com­ one or another of the reports that fol­ mittee at this time confirmed the effec­ lowed the initial House committee leak. tiveness of using military assistance for these purposes. There was said to be one IV. WESTERN CONTROL OF LIBYA AND THE category of governments sustained by U.S. PROBLEM OF SUCCESSION military aid which enabled "the regime to keep power by more or less authoritarian In 1959·William Draper, an investment means;" and there was another category of banker headed the Presidential 'Committee states described where "without United to Study the Military Assistance Program, States military assistance the government which �as composed of generals and former concerned would almost certainly have •.• Defense Department employees. The "Draper given way to a Communist or pro-Communist Committee" submitted a "composite report" regime." The two categories covered about and a collection of "annexes," or supple­ twenty countries. l � The study, however, ments on U.S. military aid to President neglected to list those countries in Eisenhower. While the composite report was which the armed forces where in the pro­ approved by the entire committee, its mem­ cess of being built up for just these bers were not necessarily in full agree­ purposes. ment with the "annexes" which were, never­ An unpublished and until recently con­ theless, passed along to the president as fidential version of Annex C concluded independent recommendations.16 with case studies of two Military Assis­ Annex C, "A Study of United States Mili­ tance Programs (MAP) - Libya and Brazil. tary Assistance Programs in Underdeveloped It suggested that Libya ·,;as one of the Areas," summarizes in general terms many countries in which the U.S. should be of the problems that countries like Libya building up the officer corps for lea9er­ presented to U.S. military planners. The ship purposes. The authors began by main­ authors carefully studied the importance taining that although "North Africa does for Western interests of "the use of the not lie in our strategic jurisdiction," Counterspy -- Nov.Bl - Jan.82 -- 25

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but rather France's, this fact still Libya's budget deficit" since 1955. "Thus "should not prompt us to belittle the far, despite efforts by extreme national­ strategic importance of the region .••• ists to depict the Libyan government as a The West, should it lose completely its pawn of the Western powers, the Anglo­ , strategic position in North Africa, would American presence has not proved a serious. find its control over the Mediterranean source of tensions. The central govern­ seriously threatened. North Africa, more­ ment, however, is under growing pressure over, flanks the routes which the Soviets from tribal elements" and from Libyans would follow in their efforts to penetrate "prodded by Radio Cairo" to moderate links Africa•••• Libya ••• serves as a buffer be­ with the West. The U.S. maintained-that tween the Middle East and the Maghreb and its relationship with Libya was "a sound at least partially shields the latter from business venture" for the Libyan govern­ the full force of Arab nationalism emanat­ ment which defended U.S. aid payments more ing, from Cairo [where Gamal Abdel Nasser as "rental for base rights" than as mili­ was then in power] •• • • So long as Libya tary aid grants. And although the Egypt­ remains friendly to the West,- the West can ians "have been critical of the Base control the southern shore and part of the Agreement from the beginning," Libyan King Eastern Mediterranean." Idris realized· "how much Libya needed to Even if the U.S. military base at Whee­ have her budget strengthened by the income lus were to become obsolete, there would ••• from the base ..•• Indeed, the Libyan

still be "compelling reasons" for the U.S. economy would collapse 1 in the absenct of to maintain political and military influ­ American economic aid.1 ence in Libya. From these considerations, The authors concede, however, that "the several consequences followed for U.S. initial favor with which most Libyans policy. Any settlement of the anti-colo­ viewed the bas1e arrangements has waned and nialist struggle in Algeria must "preserve a number of tensions have marred the work­ for the French the responsibility for the ing relationship between Libyans and Amer­ defense and foreign affairs of Algeria." icans." Moreover, ''Egypt and Russia both Moreover, "in the event of an attempted try to exacerbate these tensions in their· Egyptian coup in Libya •••, Bourguiba [the efforts to turn popular s�ntiment against Tunisian president] might intervene in the presence of the U.S. base." For exam­ Tripolitania �me of Libya's provinces] ple, Arabic-speaking members of the Soviet rather than see it fall under Nasser's Embassy frequently go to areas close to control. The United States could strength­ Wheelus and "through the technique of sub­ en Bourguiba by giving him certain pres­ tle questioning, plant doubts in the minds tige weapons ••• which would make him the of the Arabs. Is not the noise of these strongest single Arab leader in the Ma­ jets terrible? ••• Did you ever stop to ghreb." think of how much water the Americans use A major concern among Libyan officials at the base? ••• From time to time acci­ at this time was "Egypt's unrelenting ef­ dents involving U.S. military vehicles oc­ fort to bring her western neighbor within cur along the road connecting Wheelus and her sphere of influence •..• Today, Egyp­ Tripoli•.•. There have been instances, al­ tians, through a policy of cultural impe­ so, of U.S. planes dropping practice bombs rialism have come to dominate many impor­ uncomfortably close to Libyan villages." tant sectors of Libyan society" including But on the whole 11these irritations ... education and the mass media. The problem have not significantly affected the pro­ of Libya, the authors wrote, contrast Western orientation of the Llbyan govern­ sharply with those in "French North Afri­ ment.·.•. The Russians want the Americans ca," where "the French presence is the fo­ out for strategic reasons." And "so long cus of Arab hostility. In Libya•.. the as the United States continues to hold the foreign presence is primarily British and base and to carry on the economic and oth­ American. British troops helped train the er programs associated with it, the Egypt­ Libyan army" and the U.S. had its impor-"' ians cannot gain control of the country." tant base at Wheelus, representing "a The Libyan government "seems to be fully $150,000,000 investment. Since 1951, both aware of the dangers of communism," but ... Great Britain and the United States have the "people of Libya generally cfo not seem heavily subsidized the Libyan economy," to fear the communists as much as they do with the U.S. assuming "the major share of 'Western imperialists.'" 26 -- Counterspy -- Nov.Bl - Jan.82

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The pro-Western orientation of the Lib­ and Great Britain.•.. " But external sup­ yan government was said to be likely to port might not be sufficient, artd Libya's prevail as long as King Idris remains in "unity and independence" - the aim of the power. During that time, as the authors "show window" scheme - might not have been saw it, Libya's military problem was one achieved as yet by the time of Idris' not of external but of internal security. death. The Libyan army was incapable of defending Thus the U.S. had to search for a solu­ the country against outright aggression; tion to the succession problem. The au­ the Anglo-American presence, however, thors of the confidential report advised would "discourage any overt attempt at a· that "the possibility of grooming a reli­ military takeover by Egypt." By training able military elite for a future governing and equipping the Libyan army and the pro­ role merits thoughtful consideration. The vincial police forces, the U.S. and Brit­ creation of a national staff unifying the ain hoped to forestall internal problems. various forces at the top level may prove

Meanwhile, the military should also be desirable as step toward facilitating11 the 19 used as a "transmission belt" for develop­ transfer of political power. ment; "dramatic hydrological projects" in One ought, of course, to be careful in a country with severe water problems, fi­ not attributing to these remarks more sig­ nanced by the U.S., could turn Libya into nificance than they deserve: they were all a "show window" facilitating Western in­ part of a confidential portion of a sup­ terests. And, the authors contended, the plement to a report by a Presidential Com­ military "can make an important contribu­ mission which merely gave recommendations tion to Libya's unity and independence by to the president. Yet they are surprising­ •.• creating a corps of native Libyan ly similar to language that appears in ac­ teachers who are oriented favorably to the tual policy documents. An example is a West," thus pushing out Egypt's influence. summary of U.S. policy in Libya prepared Libya, by itself, was said to be "not a by the Joint Chiefs of Staff in early viable country. External financial support 1957. The Joint Chiefs' summary is br:ief, will always be required, and the United but the Draper Committee "case study" States can expect eventually to have to could be looked at as nothing less than a bear almost the full burden of subsidizing' detailed statement of the same political Libya." This was a good investment, how-' analysis espoused in the summary. ever. For relatively modest funds, the The Joint Chiefs were already in 1957 U.S., "as long as it maintains its influ­ concerned that U.S. interests in Libya ence in the formulation of Libya's econom­ were increasing rapidly. "The best inter­ ic, defense and foreign policies, will be ests of the United States will be served able to exercise a counter-weight to the by taking steps to insure the continua­ attempts of extreme nationalists to domi­ tion of a political atmosphere in the Lib­ nate the entire region from the Atlantic yan Government which will be amenable to to the Persian Gulf," attempts whose aims the continuance of the present base "converge with those of the Soviet Union." rights agreement... and the formulation of But there was a problem about succession additional agreements on reasonable terms. - "The future stability of Libya," the au­ In addition, the United States should en­ thors wrote, "hinges upon the succession courage the orientation of the Libyan Gov­ to Idris and the degree of national unity ernment toward the West, and away from which can be maintained following his Egyptian and Soviet influence. Finally, death. 1he heir apparent, a young nephew the U.S. should assist in the maintenance of the king, is conceded little chance of of � loyal armed force .!:E_ insure the .EE._­ commanding the al·legiance of diverse ele­ litical stability of the country [emphasis ments in the country." The authors feared added] after the death of the King .... The that the greatest danger after Idris' Military Assistance Program objective for death might be a secession of "the tribes­ Libya is to assist in the development of men of Cyrenaica" from the union with Tri­ the Libyan Army to have the capability to politania. Should that happen, "the Egypt­ maintain internal security and contribute 1120 ian underground can be expected to make a to the national unity of the country. A bid for power in Tripolitania. The major later State Department document of the Kenned obstacle to such a move, of course, is the y administration indicates how this continued presence of the United States was to be accomplished. The U.S. was to Counterspy -- Nov.Bl - Jan.82 -- 27

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finance fifty percent increases in the "surprised" by the coup is not so clear. size of the Libyan armed forces in the For one thing, the military was being mid-1950s, then again in the mid-1960s, groomed by the U.S. possibly to succeed accompanied by expanded training, at least the monarchy, or at least to make the in part to Westernize the officer transition smooth after Idris' death. And corps.21 the U.S. warned Idris in 1968 that U.S. military support for Libya did not mean V. _QIL, CORRUPTION AND THE COUP protection of his throne. The U.S. recog­ nized Qaddafi's new regime just several In the 1960s, Libya became important not days after the takeover and ignored ap­ only because of Wheelus and its location, peals from friends of the monarch to help. but also because of its oil and the wealth A few months later, Qaddafi had several it created for a small group of people. members of his Revolutionary Council ar­ Wilbur Eveland wrote in his book, Ropes� rested after the CIA warned him of a plot Sand: "Working in Libya, I saw first hand against him. And in 1971, the CIA and Brit­ the factors leading to the overthrow of ish intelligence stood in the way of ef­ that country's monarchy in 1969 and the forts by royalist opponents to overthrow emergence of yet another radically anti­ Qaddafi.23 Qaddafi was staunchly anti-com­ Western regime. Oil company greed, inter­ munist at this point, and this convinced necine rivalries, and subordination of Western governments that they had paved corruption sowed the seeds of this further the way for the right man. loss of American influence." Mustafa Ben Halim, Libya's second prime minister, was VI. EFFORTS TO CONTROL LIBYA'S INCREASING suddenly "a rich man just after negotiat­ INDEPENDENCE ing the first (oil] exploration conces­ sions" and the renewal of the base agree­ ment Qaddafi's increasingly militant support in the mid-1950s. But he "prudently for Palestinian rights in the early 1970s elected to allow members of the royal en­ led to a revision of U.S. policy. When the tourage to share in the spoils," giving U.S. Ambassador to Libya left his post in them an additional reason to toe the pro­ early 1973, he was not replaced.24 Recon­ Western line besides those discussed in naissance flights over Libya began in the Draper Committee study. 1972 in response to Libya's first acquisi­ As Libya's ambassador to France, Eveland tion of Soviet arms.25 In �.arch 1973, a continued, Ben Halim organized "a near mo­ Libyan plane reportedly attacked a U.S. nopoly of all engineering and construction C-130 transport that Libya claimed had en­ activities ensuing from Libya's by then tered restricted air space, but the C- 130 well established oil discoveries." When escaped undamaged. Eveland, then a representative for Vinnell Growing oil revenues after 1973 enabled Co. (one construction company interested Qaddafi to finance both guns and butter in getting a piece of the pie in Libya, for Libya, to remain unconcerned about see Counterspy, May-July 1981) met Halim Western opposition to his support for the in Paris, he learned how business was Palestinians and ties to the Soviets, and done in Libya. "The formula was forthright in fact to maintain some leverage over the and simple: Ben Halim or one of his broth­ U.S. and several European countries be­ ers shared in the contract, with payments cause of Libya's oil exports. Anwar Sadat, for this 'service' to be made (illegally, over this period, expelled Soviet advisors under Libyan law) in a foreign bank ac­ from Egypt, turned his back on Nasserism, count. In return, Vinnell was entitled to and slowly began to reintegrate Egypt into work and bid for new jobs against its (Ben the Western economic and military system. Halim-spons�red) competitors." Evelend re­ however, Qaddafi took over where Nasser had left ported, that entrants in the race off, and he began encountering the same to negotiate oil concessions in 1965 soon hostility from the West that Nasser had made Ben Halim's corruption seem "rela­ earlier incurred. The U.S. was now faced tively 'minor league."' When Qaddafi over­ with a situation where it had protected threw the monarchy four years later, nei.­ Qaddafi early on in order to control the ther ''oil companies nor Washington should 11 spread of Nasserism and of Soviet influ­ have been surprised. 22 ence in Libya after Idris' departure; now Whether the U.S. government indeed was Qaddafi himself needed to be controlled. 28 -- Counterspy -- Nov.Bl - Jan.82

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Relations between Egypt and Libya began and provided rationales for both Libya and to deteriorate after 1973. Sadat withdrew Egypt to buy more Soviet and U.S. arms. from plans to merge the two countries and There were (and are) large discrepancies excluded Libya from preparations for the between Soviet and U.S.-Egyptian estimates 1973 Arab-Israeli war. Qaddafi's Islamic of the monetary value of Libya's Soviet fundamentalism, his opposition to a polit­ a�ms. Qaddafi professed to-want to diver­ ical settlement with Israel, and his radi­ sify Libya's arms purchases, but when the cal support for Arab unity and indepen­ U.S. and France responded negatively, he dence from the West all sharply contrasted continued to buy from the Soviet Union. with Sadat's positions on these issues. Throughout the 1970s, although Libya be­ They also contrasted with the positions of came increasingly to be portrayed as a So­ some members of Libya's Revolutionary viet surrogate, many experts agreed that Council, and in August 1 975, Omar Mehishi, the chief tie between the two countries Abdul Menin al Houni, and two other Coun­ was arms sales. Several times the U.S. cil members were accused of plotting blocked export licenses for military against Qaddafi. Mehishi and al Houni both equipment for Libya, and, in February left Libya and were granted political asy­ 1 978, the U.S. ·even halted the delivery of lum in Egypt in early 1976. There they or­ spare parts for C-130s Libya already pos­ ganized Libyans in Egypt against Qaddafi, sessed; the reasons given were Libya's and Mehishi began using Egyptian radio to support for "terrorism" and its opposition transmit anti-Qaddafi propaganda into Lib­ to U.S. policies in the Middle East. In ya. A number of acts of sabotage occurred late 1978 and early 1979, however, the in Egypt in retaliation, prompting Sadat U.S. agreed to sell two 727s and three to deploy troops on the Libyan border in 747s, after Libya promised no military use summer 1976.26 for them and acceded to the Hague hijack­ France reportedly became embroiled in ing convention. The sales were cancelled the dispute in 1977 because of its growing in 1979, however; U.S. officials a�gued ties with Egypt, its long-standing in­ that Libya had interven�d in Uganda using volvement in North Africa, and its growing C-130s and stated that the 747s might be cooperation with the CIA. Roger Faligot used in similar military operations. wrote in The Middle East that in 1977, This affair, along with Libya's support Colonel Alain Gagneron de Marolles, then for Iran's revolution, the Polisario "supervising all French covert actions, forces in the Western Sahara, and Pales­ was allegedly authorized by ••. Sadat to tinian causes convinced the U.S. that launch guerrilla raids into Libya from the Qaddafi was a major obstacle to American Egyptian border. According to reliable interests in the Middle East. The Carter SDECE [French intelligence] sources, the administration escalated its propaganda CIA had pushed France to the fore in this about Soviet "penetration" in Libya. It anti-Libya exercise, which failed abysmal­ leaked news of a "secret analysis" pre­ ly." Colonel de Marolles teamed up with pared for National Securit'y Advisor Mehishi in this operation. However, MOSSAD Zbigniew Brzezinski which painted " a dis­ (Israeli intelligence) ·was "extremely hos­ turbing map of Soviet-backed Libyan-orga­ tile" to this operation. "It saw as a dis­ nized disruption ..• 1 stretching from Malta tinct threat the possibility of a pro­ to the Philippines. 1 29 Newspaper writers Egyptian government being set up in Libya, with close ties to the CIA and the Penta­ 30 thereby strengthening11 Egypt's position in gon developed this theme. (As far as any ,negotiations. 27 Malta was concerned, propaganda and covert At the same time, there were reports of operations went hand-in-hand. To under­ Egyptian military aid to Chad, and the score "Maltese opposition to Libya,"1 the Egyptian Vice President vi£ited Chad in British were setting up a phony 1 :t-faltese July 1977. This created in Libya a sense Liberation Front" that claimed responsi­ of encirclement. In one instance, Egyptian bility for bombings of Libyan build­ soldiers were patrolling inside Libyan ings.31 ) At the same time, the burning of territory, and when they did not respond of the U.S. Embassy in Tripoli tn late to a Libyan order to leave, Libya attacked 1979 and the Billy Carter affair, which and Egypt counterattacked.28 The four day lasted throughout 1980, offered U.S. pro­ war which followed did not leac to large pagandists still more ammunition against losses, but it increased Libya's prestige Li_bya. Counterspy -- Nov.Bl - Jan.82 -- 29

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Reconnaissance flights over Libya con­ Marolles again ran the operation, and tinued, and in summer 1980, Libya started Faligot claims that British Intelligence's intensifying its efforts to intercept the "Maltese Liberation Front" operation was U.S. planes. On one occasion, the Penta­ carried out in cooperation with SDECE. Al­ gon reported that an order to "arm your so apparently part of the campaign was a missiles" had been overheard by U.S. pi­ story which appeared in the London Sunday lots, although there was no evidence that Times. "French intelligence," it ran, "re­ Libya had fired any missiles. Still', in ports a big build-up of crack Egyptian October 1980, Qaddafi wrote letters to forces on the Libyan border. More specula­ Carter and Reagan demanding that the U.S. tive versions claim that a Israeli gener­ "keep its naval and air forces away from al staff working group has offered Cairo a the Libyan Arab borders ••• Otherwise, con­ blueprint for a fullscale effort" to over­ frontation and the outbreak of an armed throw Qaddafi.3 6 war, in the legal term, would regretfully A second aspect of de Marolles' opera­ be a possibility within view at any mo­ tion was an effort to contact, unify and ment.113 2 It is not known if Carter cut mobilize some of the Libyan opposition to back reconnaissance flights, but he did Qaddafi. Faligot wrote that SDECE agents overrule the Pentagon and refrained from were dispatched to Libya "to liaise with conducting naval maneuvers close to Libyan disenchanted officers of the Libyan Army," coastlines.33 The Carter administration and SDECE is said by Faligot to have was convinced that military action against "strengthened the Libyan exile 'govern­ Libya could create "unforeseen problems." ment ' in Cairo • " One such problem �uld be that of "a gen­ Egypt was again enlisted in paramilitary eral war. Sadat's moves in 1977 ••• nearly operations. According to Faligot, de touched off a larger North African war, Marolles was given "a free hand by Sadat with Algeria ready to intervene on Libya's to organize border incidents from the side and M9rocco likely to jump in against West," and French intelligence reportedly 34 set up an anti-Qaddafi "Liberation Front" Algeria. 11 Even so, Carter sought 11"to gain African support against Libya. 3 5 on Libya's border. On June 16, Egypt im­ posed martial law in the border region VII. NEW FRENCH EFFORTS TO OVERTHROW where the Four-Day War had been fought. QADDAFI Three days later, Libya accused Egypt of preparing -again to wage war. In lat_e Au­ The French government, too, was con­ gust 19801 it was reported that there were cerned about the Libyan threat to its in­ 50,000 Egyptian troops facing Libya; 37 the terests in Africa - a threat that had New York Times reported that 40,000 had grown· considerably since 1977, A new aper� been�ed there over the previous year.38 ation against Qaddafi was seen to be nec­ The object of these preparations, ac­ essary. According to Roger Faligot, the cording to Faligot, was a "military upris­ operation was organized by the SDECE along ingn on August 5, 1980 "to be organized at the same line as the operation Newsweek the garrison of Tobruk, followed by guer­ said Max Hugel had proposed. One aspect rilla action on both the eastern and west­ was a propaganda campaign, and "psycholog­ ern borders. The head of Military Security ical operations against Qaddafi were orga­ in Tobruk, Commandant Driss Shehaibi, had nized for some six months before the date been recruited by the French to lead the set for a coup" in August 1980. These in­ uprising." At the time AFP released an cluded interviews with opponents of the unattributed report hinting that "Qaddafi Libyan government in the French press us­ may have died in a sh ooting incident." In ing "elaborate leaks and stories planted reality, the French-instigated plot was by SDECE-connected journalists. A massive foiled and Shehaibi fled the country. drive was undertaken••• to·promote Claudia Wright reported later that he "had Lapierre and Collins' book The Fifth apparently invited Qaddafi to inspect mil­ Horseman, a political f1ction about itary facilities at Tobruk. Plans were Qaddafi blaclanailing Carter with an .•. made to fire on (pis) plane as it landed, but foreign military advisors ••. tipped atomic bomb." There was also a "spate of 11 3 ••• media items on Qaddafi as 'mastermind' him off. 9 of all 'terrorist groups,'" intended to However, spurious reports persisted, at- intimidate and isolate Qaddafi. Colonel de tributed to Egyptian and other Middle 30 Counterspy�- Nov.Bl - Jan.82

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Eastern sources that the "uprising" viewed him "as an agent of the interna­ against Qaddafi was continuing. The New tional Soviet-backed terrorist conspira­ York Times reported that according to dip­ cy, 1146 and was said to have characterized lomatic sources, "a mutiny broke out Aug.7 Libya as11 47 "a cancer that has to be re­ in two battalions ••• in Tobruk under the moved. command of Maj. Seyyed Idris. Major Idris In adopting a harder line, the Reagan attempted to exploit discontent ••• with administration has dismissed some of the the help of infiltrators form Egypt, ••• considerations that motivated Carter's but when Libyan authorities responded with more restrained approach. The administra­ negotiations with the troops, the mutiny tion let it be known that a cutoff of Lib­ failed and Major Idris escaped to yan oil to the U.S. would have no harmful Egypt."40 effects, and the day after Libyan diplo­ Later, after Liby.a's intervention in mats in the U.S. were expelled in May Chad, SDECE Director de Marenches proposed 1981, representatives of 35 U.S. companies French military action. But Giscard re­ were summoned to the State Department and fused, "fearing to antagonize one of urged to cut back their personnel in Lib­ France's main oil suppliers and French ya. They were told that if "trouble devel­ U.S. public opinion six m9nths41 before the Pres­ oped" in Libya, the government "could idential elections. " Instead he began to do nothing to help." One official report­ negotiate with the Sudanese and the Egypt­ edly stated later: "We 're not predicting ian governments for covert action against an imminent crisis, but we warned the com­ Qaddafi.42 Several months later, Sadat ad­ panies that the potential fo� trouble is mitted that Egypt was supplying Hissene very great." Another commented: "We don't48 Habre's Chadian rebel forces based in Su­ want to have another hostage crisis.11 dan to destabilize Chad and drive the Lib­ The oil companies have largely ignored the yans out. warnings, after receiving assurance from Qaddafi about the safety of their person­ VIII. REAGAN AND - THE "CANCER ---THA:' --HAS -TO nel. BE REMOVED" - The Reagan administration also seems prepared to risk disagreement with its Eu­ Under Francois Mitterra�!, France has ropean allies, who depend heavily on Libya moved toward more cordial relations with for o.il, and it seems willing to risk the Libya. However, it appears that Ronald regional conflict in North Africa that

Reagan11 has "taken up where Giscard left off. 43 The interagency review cf "how to handle" q'addafi, which Oberdorfer de­ scribed, was originally hampered by dif­ ferences within the State Department. The "Africa specialists'' were said to view Qaddafi as a "regional problem," solveEt)�. reported that he was "slightly obsessed with knocking ••• Qaddafi from power." Haig � COi..LEGE MEDIA SERVICES· Counterspy Nov.Bl - Jan.82 -- 31

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Carter was not. And it is perhaps prepared tives ·besides punishing Libya for "ter- even to confront the Soviet Union over rorism." Moreover, the selective applica- Libya. There are several thousand Soviet tion of the "terrorism policy" also sug- and East European advisors in Libya. As gests other motives: the recent. murder by the Wall Street Journal observed: "Dealing Taiwanese security forces of a Taiwanese with these forces would pose serious prob- dissident teaching at Carnegie Mellon,51 lems for any anti-[Qaddaf:ij military oper- and the indifference shown to the case by at ion mounted by a neighborin·g U.S. ally, the administration, is a controlled-ex­ such as Egypt. And since such forces would periment verifica.tion of the insincerity want guarantees of U.S. support, any mili- of the "terrorism policy." The long- tary operation would risk a direct U.S.- standing ties of terrorist Cubans to the Soviet confrontation." 9 CIA and other U.S. agencies; and the More speculative is Claudia Wright's re- presence in the U.S. of Nicaraguan coun- port that part of current contingency ter-revolutionary groups are further in- plans for U.S. military operations in' dications of U.S. insincerity. trouble areas of the Middle East and North And at the same time the'U.S. was acting Africa - areas 1 ike Libya - is the plan to against Libya in May, it was moving toward supplement the· main "Triple Squeeze" (as better relations with Iraq, which has long Haig calls it), consisting of three kinds been excluded under law from U.S. weapons of direct military operations - ships, ma- purchases because of its alleged support rines, emigre'paramilitary operations - ' for international terrorism; after all, as with a "fourth squeeze, to be prepared in Haig observed before Congress. in March, tight secrecy and flashed at the Soviet there seems to be '' some shift in tr.e Iraqi Union to deter it from coming to its cli- attitude," related to "greater sense of ents' rescue." This "squeeze" will come concern about the behavior of Soviet impe- from nuclear weapons, stocked in Turkey rial ism in the Middle East area." Thus and Greece "but available for dispersion what the campaign against "international around the western Mediterranean if the terrorism" in its not-so-public side is secre� part of talks with Spain and Portu- really about are the long-standing Ameri­ gal can be settled as Haig would like. 11 50 can aim� of propping up clients fighting It is not simply the existence of such the Soviet Union and progressive govern­ plans which is the most frightening, for ments. Otherwise, why be concerned just such operations have been planned for many with "international" terrorism and not al- years, but rather the openness and con- so with the "domestic" terrorism of the cretenJss with which U.S. officials now kind the U.S. exports to El Salvador, Ar- boast of them. gentina, Guatemala, -Thailand, Indonesia, The efforts against Libya have to be un- and many other nations? derstood as part of the Reagan administra- Like France the year before, the U.S. I tion' s so-called campaign against "inter- now considers Libya to be a major obstacle national terrorism." This campaign ·has a to its policies in Africa. U.S. officials · public side and a not-so-public side. Its have stated that it was Libya's interven- public side emphasizes state-sponsored tion in Chad that opened their eyes to the international "ter-rorism" and the "ter... "Libyan threat." Curiously, African states rorism" of national liberation movements. were more indifferent to the intervention, On May 6, 1981 when the administration according to Andrew Young: "A Libya-domi- closed the Libyan Embassy in Washington, nated Chad caused little alarm initially, the State Department justified the action because Africans saw it merely as an ex- as a response to Libya's "wide range of pulsion of French influence. But •.• Muslim provocative behavior and misconduct, in- riots in Kano, Nigeria, and the fears of eluding support for international terror- Senegal's former president Leopold Senghor ism.", Officials also stated that the ac- raised a question of malicious mischief tion was catalyzed by the attempted mur- which could be damaging to Sudan, Cameroon der of Faisal Zagallai, an opponent of and Mali - all countries with complex bal- Qaddafi attending school at Colorado ances of Christian and Muslim popula- State University. Claudia Wright, how- tions.11 52 Perhaps Egypt should now be ever, reported that the expulsion was added to this list, after Sadat's Sep- "one of the first and last schemes de- tember 2 mass arrests of Muslim and Chris- vised by Max Hugel," suggesting other mo- tian opponents (among others) whc he said 32 -- Counterspy -- Nov. 81 - ,?c.r..82

Ap roved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 threatened "national unity." Reportedly, munication Agency (ICA) "has arranged for there is also a fundamentalist Muslim fac­ its •.. centers around the world to make tion in the armed forces that increasingly sure the book is promoted to local read­ opposes Sadat's policies on Israel and ers. 11 56 other matters, 53 a faction that could at In June 1981 the CIA issued another cen­ some point respond to a call by Qaddafi. tral document in the campaign, its new an­ Several times U.S. officials have reiter­ nual report on international terrorism. ated Senghor's assertion that Libya is Not surprisingly, Libya was said to be the dedicated to establishing a Saharan empire "most prominent state sponsor of interna­ uniting Muslim tribes throughout northern tional terrorism." A review of intelli­ Africa south to Zaire. No evidence has gence on terrorism was ordered soon after ever been offered to support this claim. Haig's first remarks on the subject. The At the same ti.me, U.S. officials have resulting CIA report was rejected by Casey seen other kinds of Libyan influence as . because it did not support Haig's asser­ obstructive to American interests. Libya's tions on terrorism. Casey then ordered a oil has'enabled it to offer generous for­ second report to be prepared by the De­ eign economic aid, and the U.S. pas sever­ fense Intelligence Agency, but that one al times countered Libyan offers of aid too was rejected. A third report was then with American offers. Qaddafi will be begun, using new material as well as mat�­ chairman of the Organization of African rial from the two rejected reports. It is Unity (OAU) when it meets in Tripoli in unclear if this third report was issued as 1982, and the Reagan administration tried the annual report on terrorism, but those unsuccessfully to get member nations to familiar with it told the New York Times revoke that honor. that it concludes that "the Soviet Union Libyan influence, further, is seen as a has not played a direct role in training foot in the political door for the Soviet or equipping traditional terrorist groups Union. In the new cold war atmosphere such as the Red Brigades .... It does find since the collapse of SALT II and the that the Soviet Union has provided aid to shifts of power in the Persian-Arabian organizations and nations, including the Gulf, the Soviet connection has come in Palestine Liberation Organization and Lib­ government circles to be more than mere ya, that support terrorism and engage in 11 7 propaganda. There is much variation among it themselves. 5 ; estimates of the size of Libya's military The efforts against Libya also reflect purchases from the Soviet Union, but it is the importance the Carter administration emphasized repeatedly that Libya, with its started to attach to covert operations af­ small number of troops, could never make ter the fall of the Shah of Iran and their use of it all. On the other hand, the So­ even greater importance to the Reagan ad­ viet Union's Libya connection is useful ministration. Because of past actions and for U.S. planners who find talk of "inter­ revelations making it more difficult for national terrorism" politically unsatisfy­ the CIA to conduct its o�m operations, ing and seek to reformulate the issues in Reagan appears to have decided to collabo­ traditional cold war terms. Of course, rate more closely with anticommunist these planners are ably served by journal­ forces abroad. Moreover, public concerns ists with whom they have close ties. 54 in tl.e U.S. that led to restrictions on A central document in the campaign CIA covert operations haven't disappeared: against terrorism has been Clalre Casey himself stated that openness "could Sterling's The Terror Network. She devotes panic an American public which has not yet a chapter to Qaddafi, who she calls "the recovered from the Vietnam morning-after Daddy Warbucks of international terror­ syndrome.1158 ism." The chapter was reprinted in March The CIA is reported to be working 1981 in the neo-conservative The New Re­ through counter-revolutionary Cubans jn public under the ominous headline:"A---;-ur­ Central America, through Egypt in Afghani­ derer, a maniac - am Moscow's man.'' The stan and against Iran, and in collabora­ book conforms closely to Haig's conception tion with China against Vietnam. CIA Di­ of international terrorism and the Soviet rector Casey seems to be calling for a Union's role in it.55 Thus the U.S. gov­ sort of "Nixon Doctrine" for covert ac­ ernment has done its best to promote The tion, in which the U.S. would supply in­ Terror Network, and the International Com- creased aid, but place the primary respon- C'ounterSpy -- Nov.Bl - Jc.n.82 -- 33

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 sibility on the nation assisted. But U.S. to train the Liberian military) in order allies, too, are reluctant for the CIA to to make it unnecessary for Liberia to ac­ undertake such actions, thus requiring cept Libyan aid.60 Indeed, Liberia broke "increased conditioning" of allies to the off relations with Libya when Qaddafi vis­ necessity "for covert operations against ited Moscow in April 1981, and this break Soviet surrogates and revolutionary was surely related to U.S. pressure. forces" to be coordinated by the U.S. Similarly, the U.S. has urged non-Afri­ Given\ the constraints imposed on the can countries to join the campaign against CIA, successful operations require f9ur Libya. A Wall Street Journal report kinds of efforts discussed by Newsweek: stressed that the.U.S. "has been pressur­ (1) isolation of target countries; (2) a ing France, Italy, West Germany and Brit­ propaganda campaign; (3) mobilization of ain to take a tougher line" against opposition forces; and (4) military action Qaddafi, even though "these countries have from neighboring countries through emigrl extensive commercial relations with Lib­ forces or regular troops, assisted, if ya. 1161 The Reagan administration has un­ necessary, by the U.S. Each of these ef­ dertaken an especially intense effort with forts was part of the French campaign Italy. The previous Italian cabinet re­ against Libya in 1980, and now that the portedly agreed tentatively to a visit by Reagan administration has taken over that Qaddafi in summer 1981. But the plan was campaign, and apparently approved policies opposed by the U.S., and Haig and Defense that enable it to proceed with each of Secretary Caspar Weinberger 11 "made strong these kinds of efforts, it is important to efforts to block the visit. 62 Italy's new look at each categQry for evidence of how Premier, Giovanni Spadolini, is anti-Arab the campaign against Libya is p�oceeding. and very pro-American, and the visit has been cancelled. IX. ISOLATING LIBYA X. THE PROPAGANDA CAMPAIGN AGAINST LIBYA A diplomatic campaign against Libya has been going on for some time, and State De­ Propaganda against Libya has had five partment officials are said to assert that major themes: (1) that Qaddafi is the "pa­ "the administration would be willing now tron saint of terror," as Haig put it; (2) to en�ourage actions against the Qaddafi that Libya is militaristic and "imperial­ regime. However, it is up to the Afri�an istic;" (3) that Libya is a Soviet surro­ states themselves to take the lead. ,,59 Mo­ gate; (4) that Qaddafi is a madman and the rocco, for example, reportedly lo bbied "most dangerous man in the world;" and (5) strongly against Libya in the months prior that, domestically, Libya is mismanaged to the OAU meeting in late June 1981, and and not meeting its people's needs, that it is hard to imagine that the U.S. did it is repressive, and that there is an op­ not coordinate strategy with Morocco. position in Libya that is large, growing, Condemnations and breaks in diplomatic and worthy of support. relations are two other ways by which col­ Phil Kelly wrote in The Middle East that laborating nations can "publicize their disinformation on 4ibyan terrorism regur hostility." The U.S. has taken the �ead in larly enters the West from Egyptian, Mo­ these actions, and a number of Afriqan na­ roccan, Tunisian and Israeli sources. An­ tions have followed. The U.S. has arso other source of disinformation is the Pha­ tried to reduce the incentives for Libya's langists' '.Toice of Lebanon radio station neighbors to move toward closer relations. which carried a report alleging that "ter­ Military assistance has increased to Tuni­ rorist leader 'Carlos' was in Libya, near sia, Egypt and Sudan. Tunisia's acquisi­ the Sudanese border, tra�ing terrorists tion of M-60 tanks is specifically to "de­ to attack the oilfields of Libya's oppo­ ter further Libyan adventurism." Increased nents." This item resurfaced in Egypt's military aid has also been discussed with government-controlled Middle East News Morocco and Algeria. Further south, the Agency (MENA) in June 1981, this time U.S. has devoted much attention to stabi­ claiming "King Khaled of Saudi Arabia lizing Liberia's economy with loans and would be a target during his state visit" grants and to initiating increased mili­ to England. The story was repeated in many tary cooperation (including the arrival of British newspapers, "quoting MENA to the 100 Green Berets in Monrovia in April 1981 effect that an attempt on King Khaled's 34 Counterspy -- Nov.Bl - Jan.82

f Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 life would be made by Carlos and two Pal­ group in April 1977, along with an Egypt­ estinian groups with 'the backing of Colo­ ian saboteur and his accomplices were the nel Qaddafi. 11163 first executions in Libya since the 1969 In the U.S., the Billy Carter affair has coup; according to Gideon Gera, "death returned to the realm of non-events from sentences on prominent monarchists [had] which it came. But another scandal has de­ either been commuted or pronounced on ab­ veloped over the activities of ex-CIA op­ sentees.1170 And contrary to the Reagan eratives Edwin Wilson and Frank Terpil, a9ministration's pronouncements, the Lib­ giving the press and the government a new yan government claims that the so-called forum for horror stories about Qaddafi. A "liquidation campaign" of Libyan dissi­ tan9ful of government agencies appear to dents is not run by the government. The be providing the press with a steady fact, .little mentioned, that victims have stream of well-planted leaks. been mostly minor opposition figures The disinformation on Libya's interven­ would seem to support this.71 Of course, tion in Chad - the main example offered of such subleties matter little to the ad­ "Libyan imperialism" - is extensive. 64 ministration, which ordered out Libyan· First, it is useful to note, as the press diplomats because of the "liquidation and government spokespersons usually do campaign" long after everyone else had not, that the Libyan military is small - agreed that it was over. much smaller than the 100,000-man force Another, subject prominent in the propa­ that Sadat now has deployed on Egypt's ganda is that of coups against Qaddafi. border with Libya 65 - and that "Qaddafi is Coup attempts in libya get reported regu­ viewed as unlikely to extend his military larly whether or not they have actually incursion beyond Chad. His 60,000-man occurred. An impression of widespread dis­ armed forces, with more than a tenth of satisfaction is nonetheless created. their manpower in Chad, are said to be too Kelly, for example, wrote: "A story about strained logistically in that country to an attempted coup in Tripoli last January do more than consol:f.date their pcsitions [1981J began in the Cairo daily Al-Ahram and yet (Qaddafi's] threat has helped jus­ and found its way into the BBC monitoring tify military buildups and requests for service, and so irto Western press 'back­ aid by Egypt, Tunisia and Israel. ,,E,E grounders' by February. 1172 Other articles in the .U.S. media have sug&ested that Qaddafi l-.,e.51 reismaP.aged XI. CREATING AKI: Y.CBILIZING OPPOSITION Libya's oil wealth, buying vast amounts of TO �DDAFI weapons but not providing for the people's needs. 67 But even l!ewsweek acknowledged The CIA strategy of trying to work that since 1969, "Libya has built 200,GOO through surrogate forces, Haig' s willing­ houses and planted 40() million trees." In ness to empl0y a "mixture of expatriate addition, the average annual wage rose subversives and mercenarif.'s, who can pa­ from $1,700 to $10,000 over the past ten rade as national liberators recognized by years. "'You don't see poverty or hunger Washington"73 as the third part of the here,' says one Western ambassador in ''Triple Squeeze," and a collection of re­ Tripoli. 'Basic human needs are met to a ports specifically about Libya all give greater degree11 than in ar..y other Arab credence to the report by Newsweek that country. •68 Qaddafi has initiated a num­ the adr.1inistration' s appro.ach tc Libya in­ ber of changes in the economy since early cludes an effort tc "recruit reliable 1980, including the phasing out of most agents from within the Libyan exile commu­ private: businesses. This bQS created some nity" to build a "viable opposition" to opposition from the �iddle class and a Qaddafi. t:ewsweek quoted one senior U.S. number of arre,sts have occurrec!. Tr.e fig­ official as statiJ:ig: "I don't think any­ ure of 2,000 has been widely quoted as tr.e thing is going to gear up from this side number of those arrested, but the Sta.te until there is a clear sense that there is Department's own human rights report on scmething tc i.icrk with," implying it will Libya asserts that "abuses of tl:is magr.i­ ·,.:·en there is.7 4 The Wall Street Journal tude have not been confirmed. rrE9 earlier .reported that-e�er:..,...though there is For all the writing on Qaddafi's ''mur­ no official confirmation, "the U.S. is derous" policies it should be pointed out widely believed to be working with the that the executions of 22 of Mehishi's Libyan exiles in the hope. of developing an Counte2•Sr;y -- N01). 87 - Jc:n. 82 35

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5 organized resistance movement• .,7 Another lightly, the U.S. attorney's office in· report stated that, although U.S. offi­ Manhattan declined to prosecute. For the cials will not confirm1 such contacts,· "ex- "disturbed" U.S. officials, the _issue iled Libyans, including supporters of was, as one State Department employee [Abdul al Houni] ••• who ••• now leads put it: "What· better way [than to prose­ Libyan emigris in Egypt, say they have cute to prove that we are [a] responsi­ asked the United States what it would do, ble }. overnment]?" A spokesperson for if anything, to help neutralize or over­ the .S. attorney's office in Manhattan come the Soviet Bloc security forces sup- refused to state reasons for the failure 1 '>orting Qaddafi. 1 7 6 to prosec�te. 78 (The week before the sei­ . An even clearer· indication of CIA con­ zure of the mission, anti-Khomeini Irani­ tacts concerns Yahya Omar, a Libyan busi­ ans seized the Iranian interest section in nessman who was sentenced to death in ab­ Washington and are now being prosecuted sentia by a Libyan· revolutionary court in for a felony in federal court. These Ira­ March 1981', and who is mentioned in two nians, however, were lefti�ts and presum­ prominent articles on the Libyan exile op­ ably would not be the kind of Iranians the position which appeared in May 1981. Ac­ U.S. could "recruit as reliable agents" cording to Newsweek, the U.S. government against Iran.) "has warned Yahya Omar,.an Arab multimil­ The anti-Qaddafi Libyans are a different lionaire wit'h ties to U.S. intelligence, story. Although Mohammed Mugarieff (a for­ that he may be on the hit list drawn up by mer Libyan ambassador to India who re­ terrorists acting for [Qaddafi]," because signed last ye ar) - bas expressed bitterness FBI agents found his name at the home of about the CIA role in Libya and called on Eugene Tafoya, who has.been charged with the U.S. to "leave us alone in our strug­ Zagallai's attempted murder. Omar, who was gle" against Qaddafi,79 some of the Libyan part of Libyan King Idris' entourage when opposition in the U�S, is notably pro­ Qaddafi overthrew him in 1969 escaped American. The Washington Post reported in aboard a U.S. Air Force plane, and took ¥.ay 1980,.for example, after about 130 with him a fortune in crown jewels. Since hooded anti-Qaddafi demonstrators marched then, Omar has been an advisor to the Sul­ through downtown Washington, that the dem­ tan of Oman. "On some of his frequent onstrators were "largely pro-American, an trips to Washington, Omar has stayed at experience some Washingtonians, remember­ the apartment of James Critchfield, a for­ ing the sometimes violent demonstr�tions mer chief of the CIA's Middle East divi­ held by hooded anti-Shah Iranians in the 77 past, found a little difficult to come to sion." One can speculate that this item 11 was leaked as part of the effort to em­ terms with ! 80 For all the propaganda barrass Libya with the Wils9n-Terpil af­ about opposition to Qaddafi, little is fair (Tafoya worked for Wilson), but the said_about its political orientation; one article points to another fact: the CIA report stated only that there are "Arab was directly involved in Libya until the nationalists, Islamic fundamentalists, progressive, or left, and liberal fac­ early 1970s, and its contacts with monar­ 11 chists, and early Qaddafi supporters as tions. 81 The fact is that the organized well, apparently continues. opposition is nearly entirely the kind the The aftermath of the July 1981 seizure U.S. can work with, and despite problems by Libyan students of the Libyan mission progressives might have with Qaddafi's to.the United Nations is also revealing. policies, no substantial opposition has The students ousted the diplomats and developed from the left. staff, destroyed papers, books and pic­ On the other band, as the Wall Street tures of Qaddafi, and barricaded them­ Journal reported, "there isn't any sign selves inside for three hours. When ar­ that grumbling among ordinary Libyans has rested, they were booked only on charges been organized into an effective internal of criminal trespass, a misdemeanor; and opposition that could work with the ex­ the j�dge reportedly "adjourned the iles." Qaddafi's "biggest domestic worry cases 'in contemplation of dismissal' is the widespread unpopularity of his eco- and released the protesters on the nomic measures:" recent edicts national­ equivalent of six months, probation." ized all businesses and placed heavy re­ 'Although U.S. officials were reported­ strictions on inheritance and large sav .. - ly "disturbed" that the case was treated ings accounts.82 3p -- CountePSpy -- Nov.Bl - Jan.82

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Although there is talk of the "slow, te­ stories about opp�sition and instability dious task" of building an opposition, it in- Libya. One, unsigned, appeared in the is clear that the difficulties in carrying Washington Post the day the expulsion or­ out that task make U.S. planners think, as der was reported and seems thus t o have they have always done in the case of Lib- been in preparation for some time; 87 an­ , ya, in terms of a coup from the military. other appeared later in the.month , almost This is made plain by the attention devot­ coinciding with the events inside Libya.88 ed to the problem of a possible successor Both articles would have required much ad­ to Qaddafi, whose remove! "might simply vance research, and the information for open the way for the installation of a new them would consequently appear to have leader who ·is even closer to the Sovi-· been supplied by Libyan organizations or ets; 83 European governments also claim U.S. government sources, both having an this concern, as well as the concern that interest in publicizing the issue. A Daily a successor may reduce oil output and for­ News story that the U.S. was drafting a eign exports. More explicit is a statement plan to overthrow Qaddafi was deliberately made by "one U.S. official" to the Journal leaked in Ma 1981, about a week before some time after the warnings to oil compa­ the arrests.86� Its possible connections to nies about personnel in Libya: "The compa­ the coup attempt remain unclear, but it nies won't get another warning. We're reports that the U.S. was drafting a plan playing confrontation politics, and we to encourage Egyptian sponsorship of a want them out, whether there is a coup in coup agairist Qaddafi. the works or not.1184 Moreover, Don Oberdorf er wrote that Lib-, XII. MILITARY PREPARATIONS AGAINST QADDAFI ya was an important topic in the conversa­ tions in early August 1 981 between Reagan Libya. is reported to figure prominently and Sadat. Sadat reportedly said that Lib­ in Haig's "Triple Squeeze" plan: around yans inside the country, rather than overt Libya, for example, there are "Arr.eri­ pressures from the outside, which the can reinforcements and staging facilities Reagan administration has focused on in in the Egyptian western desert, covert aid its public posturing� are the most effec­ for [Habre's Chadian] guerrilla force in tive opposition force.BS Given the confir­ south-west Sudan, on the Chad border, mation of the thrust of the Newsweek-Time close-in Sixth Fleet patrols in the Gulf report by various independent sources, of (sidra], and improved air defense and Oberdorfer's little-noticed report is surveillance11 operations from Tunisian ter­ quite astonishing. It affirms that plan­ ritory. 90 These preparations, in addition ning for a covert operation against to the increases in military assistance, Qaddafi - perhaps a coup - is being con­ are to play a large �ole in the project ducted at the head of state level. Oberdorfer later corroborated, after the These reports are especially noteworthy initial report by Time, "a long-range en­ because of indications that the C.S. and terprise which concentrates on placing Egypt had at least foreknowledge of a May pressures on Qaddafi from outside his 1 981 coup attempt in Libya. Claudia Wright country." Oberdorf er' s sources con£ irmed po:f.nted out that Sadat's use of an AWACS much of what Newsweek and Time had report­ plane to fly to Sudan to meet with Jaafa.r ed earlier and, as the White House had Nimeri at about the same time the plotters done, focused their denial very narrowly were arrested suggests that the plane was on the claim that the11 plan included "an being used not to protect Sadat a&ainst an assassination plot. 91 (But even this de.­ attack as he claims, but to give the U.S. nial may be "misleading. Columnist Jack and Egypt knowledge of the plot's effec­ Anderson claimed that his associate Ron tiveness and warnings of moves by Syria McRae discovered schemes involving hit men and the Sov:f.et Union to come to Qaddafi's posing as mercenaries for Qaddafi and poi­ aid.86 These events occurred two weeks af­ sons with delayed effects. The details ter Max Hugel's plan to expel Libyan dip­ sound fantastic, and Anderson gives no lomats was carried out and the oil compa­ solid evidence, but after the operations nies were warned to get their personnel against Cuba in the 1 960s and the other out of Libya. The expulsion and warning reports about Libya reviewed here, they generated front-page news, much publicity cannot be dismissed.92) about "Libyan terrorism," and several These reports all tend to verify the Counterspy -- Nov.Bl - Jan.82 37

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story reported by Lars Nelson in the New Libya during the school vacation period." York Dailz News on May 17, 1 981 • "The (2) The commander of the Navy task force Reagan administration," he wrote, "is conducting the maneuvers off the Li�yan drafting a secret strategy to use Egypt coast "was called back to Washington be­ and other moderate Arab states" to topple fore the exercise by the Joint Chiefs of Qaddafi. "But the effort to neutralize him, Staff to make sure that all operational a senior State Department official in­ rules, including the rules of engagement sisted, would not take the form of assas­ in which fire is returned, were under­ sination." Rather, the administration stood. High level sources said the brief­ would "encourage" conservative Arab states ing on the exercise extended to the Na� that feel threatened by Qaddafi, "most tional Security Council. 11 94 (3) Given the notably Egypt, to take action of their limits of their planes which are more own, either through direct invasion or bombers than fighters, the libyan pilots sponsorship of a coup. If th� Arab attempt had virtually no chance of hitting the appeared to be near failure, the U.S. U.S. planes. This raises questions "about would provide direct assistance, one offi­ whether the Libyan firing was an accident cial indicated ...• The operation against or a nervous reaction by the pilot, since (Qaddafi] would be done in such a way that earlier in the two-day Mediterranean ,exer­ the U.S. would be able to claim that it cise about 40 other Libyan planes had come was not directly involved. But senior ad­ out to probe U.S. defenses, with no mis­ ministration officials are saying private­ siles being fired. 11 95 ·If other actions ly that the U.S. would give direct assis­ wer,e open to the U.S. pilots besides the tance to the Arab states to make sure that return of fire, there is reason to think it succeeds. 11 93 that the incident was pr ovoked. (4) The There is something very unreal about ,Navy later admitted that the incident had Nelson's report, in which "senior" offi­ occurred outside the area the U.S. had cials are surprisingly talkative. There is warned air and sea traffic to avoid in no reason to think that these.are leaks preparation for the exercise.96 (5) The

1 from one faction out to embarrass another, Newsweek item that warned the Libyans that, as was later the case with the Casey ad­ the exercise had been undertaken to "test" fair. More likely, the aim was to intimi­ Qaddafi is thought by many observers to date Qaddafi into policies more acceptable have been a deliberate leak to provoke the to the U.S. or to send signals to allies Libyans.97 Newsweek, in fact, first re­ and potential allies that the U.S. would ported the exercise in its July 20 issue, be tougher and reore reliable in protecting at about the same time Getler report�d its friends. Still, these statements seem Reagan was approving it in the NSc.98 (6) to violat·e Casey's edict against openness, The Newsweek article reports that Egypt and questions thus remain about the moti­ was conducting military maneuvers on its vations behind the statements. It is, of border with Libya ccnsecutively with the course, just possible that they are boasts naval exercise, and although U.S. offi­ from men who are ready to exercise power cials insisted that this was a "coinci­ and undisturbed at who knows it. dence," they were eager to see how Qaddafi Many similar questions are raised about would react. 99 the Gulf of Sidra incident. It, too, seems Egypt, of course, is central to all mil­ to have been exploited to intimidate Libya itary plans against Qaedafi because of its and to rally allies. A number of points long--stand ing hostility toward Libya, its are important to keep in mind: (1) Michael 100,000 troops in the border area as of Getler reported in the Washington Post January 1981, and the size of its arms just after the incident that U.S. offj­ purchases from the U.S., which will nearly cials had said "the basic decision to hold double in 1982. All scenarios for military the naval exercise off Libya was made by action project it coming mainly from Reagan at a National Security Council Egypt, whether from emigre groups (as in meeting late in July. These officials also the French operation) or from the Egyptian said there were considerable discussions military. Oberdorfer wrote, however, 'that before within the Pentagon about a possi­ Sadat's emphasis on Libya's internal oppo­ ble postponement until after the summer. sition in his talks with Reagan "may have One reason is that there are several huc­ reflected a reluctance on the part of

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time."1 00 Klare's prediction, justifying· their ac­ Along similar lines, Newsweek emphasized tions with the same rhetoric. Hawever, that only when the U.S. succeeds in build­ there are still many who can be counted ing up the opposition to Qaddafi will the .on to oppose any U.S. military interven­ CIA "then support more expensive and more tion in the Third World no matter how it visible propaganda and paramilitary opera­ may be disguised. tions.11101 -On the other hand, there has been more speculation recently about Isra­ FOOTNOTES eli military cooperation with Egypt against Libya now that Israel's relations 1) Washington Post (WP), 8/20/81, pp.A-1, A-17. with Egypt are largely normalized. Then 2) Newsweek, 8/10/81, p.24. agricultural minister Ariel Sharon was 3) WP, 7/25/81, pp.A-1, A-14. 4) Newsweek, 8/3/81, p.19. given a tour of Egyptian deployments in 5) WP, 7/28/81, p.A-2. the border region in late May 1981, and 6) Chicago Tribune, 7 /28/81, p.3. this fueled the speculation.102 Sharon, of 7) cf supra, #5. 8) New York Times (NYT), 7/28/81, p.A-13. course, is now Israel's defense minister. 9) Christian Science Monitor (CSM), 7/29/81, p.4. 10) WP, 8/15/31, p.A--3.-- - 11) Wall Street Journal (WSJ), 8/4/81, p.30. XIII. THE FUTURE OF THE C�AIGN AGAINST 12) Time, 8/10/8�. - LIBYA 13) cf supra, #2. 14) Newsweek, 8/31/81, pp.16-17. 15) WP, 8/20/81, p.A-29. The possibility of an Egyptian invasion 16) See Blanche Cook, The Declassified Eisenhower, Garden of Libya with U.S. backing may seem re­ City, N.Y, 1981, pp.329-=532. 17) Supplements, Annex C, March 1959, pp.55, 78-80. mote, but so did the possibility of an 18) CIA Report, "Certain Problems Created by the U.S. Mili­ Iraqi invasion of Iran before it began tary Assistance Program," cited in Cook, cf supra, 1'16. 19) "Case Studies of the Military Assistance Program in just over a year ago in circumstances that North Africa (Libya) and Latin America (Brazil)," in "A bear some similarities to present ones. Study of the United States Military Assiltance Program in Underdeveloped Areas," unpublished version, Eisenhower Li­ Iran had successfully been isolated inter­ brary, pp.52-65. nationally through U.S. efforts; the pro­ 20) Joint Chiefs of Staff, Military Aid for the Middle Shah opposition to the Iranian revolution East, JCS 1887/340, 2/1/57, p.2555. m-state Department, "North Africa in the Mediterranean had made an alliance with Iraq and was in Littoral," 8/9/63, p.22. contact with U.S. officials; a campaign of 22) Wilbur C. Eveland, Ropes£!. Sand, W.W. Norton, New York, 1980, pp.316, 317. propaganda had successfully pictured 23) Foreign Policy, Spring 1981, pp.81-82. Khomeini as a madman and a mastermind of 24) ibid,, p.84. 25) NYT, 10/24/80 international terrorism (see CounterSpy, 26) Gideon Gera, "Libya," in Colin Legum (ed.), Middle Nov.SO - Jan.81). East Contemporary Survey, vol.I, 1976-77, New York, 1978, The Reagan administration seems intent p.535. 27) The Middle East, August 1981, p.34. to learn from.the Iran "adventure." Wheth­ 28) clsupra, IIU:-p.536. er Reagan intends to repeat Carter's Iran 29) Sunday Times (London), 6/20/80, p.10. 30) see NYT, 3/14/80, p.11; Business Week, 3/3/80. strategy completely - by cutting off oil 31) cf supra, H27, p.36. imports, declaring an economic boycott and 32) cf supra, #25. 33) NYT, 8/21/81, p.10. urging other nations to do the same, ban­ 34) clsupra, #23, p.91. ning travel, deporting Libyans, and creat­ 35) NYT, 6/3/81, pp.1,12. ing incidents that might provoke. the sei­ 36) clsupra, 1129. 37) NYT, 8/24/80 , sec.IV, p.2. zure of hostages or some other reason for 38) NYT, 8/19/80, p.12. confrontation - is hard to know, but the 39) clsupra, #27, p.23. 49) cf supra, 1138. precedents are there. 41) cf supra, H27, pp.34-36. Two years ago Michael Klare reported in 42) New Statesman, 8/21/81, p.13. The Nation on U.S. efforts at that time to 43) ibid. 0 44) WP, 3/21/81, p.A-3. "cure the Vietnam syndrome.111 3 He warned 45) cf supra, Ht. of the danger of so-called "humanitarian 46) WP, 3/22/81, p.A-1; according to this article and WP, 8/20/81, pp.A-1, A-17, these impressions are the resultof intervention" - i.e., "Entebbe-type raids of interviews with Western European foreign ministers to free civilian hostages or campaigns to who visited Reagan and Haig. topple such troublesome despots as, say, 47) quoted anonymously in New York Daily News, 5/17/81, p.2; attributed to Haig by Claudia Wright, New Statesman, Colonel Qaddafi or the Ayatollah 8/28/81, p.11. Khomeini." Iran soon afterwards saw such 48) NYT, 6/27/81, pp.1,37. 49) WSJ, 7/14/81, pp.1,16. a raid and such a campaign, both justi­ 50) New Statesman, 4/10/81, p.2. fied as "humanitarian." Reagan, Ha:f.g and 51) Far Eastern Economic Review, 9/4/81, p.34; WP, 9/14/81, Casey now work to fulfil the remainder of p.C-15. 52) Foreign Affairs, vol.59, no.3, p.664. -- Counterspy Nov.Bl - Jan.82 -- 39 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

53) � Days, 8/22/81, p.13. 79) cf supra, #66. 54) E.g. Robert Moss, New York Times Magazine, 11/2/81. 80) WP, 5/24/80, p.B,-4. 55) NYT, 5/3/81, pp.l, 36. 81) NYT, 5/27/81, p.A-8 56) New Statesman, 8/21/81, p.16. 82) WSJ, 8/31/81. 57) cfsupra, #55. 83) ibid. 58) WP, 8/26/81, p.B-18; -WP, 8/27/81, p.C-31. 84) ibid. 59) cf supra, 1135. 85) cf supra, #1. 60) African Index (AI), 6/15/81, p.33. 86) cf supra, #42; The Middle East, September 1981, p.16. 61) cf supra�. - 87) cf supra, 1166. ------62) cf supra, 1139, p.18. 88) cf supra, #81. 63) The Middle East, August 1981, p.24. 89) Daily News, 5/17/81, p.2. 64) See Louis Eaks, et. al, From El Salvador� the Libyan 90) cf supra, #50. Jamahiriya, London, 1981, pp.61-82. 91) cf supra, #1. 65) WP, 1/16/81, p.A-27. 92) WP, 8/25/81, p.B-15. 66) WP, 5/7/81, p.A-21. 93) cf supra, 1189. 67) cf supra, H35. 94) WP, 8/20/81, pp.A-1, A-16. 68) Newsweek, 7/20/81, p.42. 95) WP, 8/21/81, p.A-15. 69) State Department, Country Reports� Human Rights Per­ 96) WP, 8/25/81, p.A-13. spectives, 2/2/81, p.1039. 97) Such as Adm. Eugene Carroll (ret.), CBS Evening News, 70) cf supra, #26. 8/21/81. 71) cf supra, #42. 98) cf supra, 1/66 , p.46. 72) cf supra, 963. 99) Newsweek, 8/24/81, p.13. 73) cf supra, 1150. 100) cf supra, #1. 74) cf supra, 1114. 101) cf supra, #1/,. 75) WSJ, 7/14/81, pp.l, 16. 102) Newsweek, 6/15/81, p.25. 76) cfsupra, 1166. 103) The Nation, 10/13/79. 77) Newsweek, 7/27/81, p.13. 78) Boston Globe, 8/28/81, p.12.

The Gambia Betrayed by Konrad Ege

On August 4, 1981 hundreds of Gambians 20 40 50 miles and Senegalese marched through Washington, D.C. and other cities in the U.S. carrying posters such as "Diouf is a French Wolf in Africa," "Senegalese Troops out of The Gambia," and "I.M.F. is a Bad Pill that Kills." The demonstrations had been called by the Washington-based Student Co­ ordinating Committee on The Gambia(SCCG) to protest the "Franco-Senegalese invasion of The Gambia." At the time about 2,500 Senegalese troops - close to one third of Senegal's armed forces - were in The Gam­ bia. The invasion began on July 30, 1981, most reporters knew only that The Gambia less than twelve hours after a gr oup of was staunchly pro-Western and believed it progressive Gambians, apparently led by was a "model of democratic government." Kukli Samba Sanyang, the head of the out­ (see Washington Post, 8/3/81) lawed Socialist Revolutionary Party (SRP) For most Gambians, things looked some­ had taken over key buildings in Gambia's what different. Economic conditions were capital Banjul and announced that Presi­ disastrous, partially due to dry weather dent Sir(!) Dawda Jawara was overthrown. which had destroyed imuch of the peanut Jawara, who had been the head of Gambia's harvest(Gambia's mJin crop), but mainly government even before Gambia's indepen­ because of corruption and an inefficient dence from British colonialism in 1965, government bureaucracy. Austerity condi­ was attending the royal wedding in Lendon tions imposed by the International Mone­ at the ti.me. By many accounts, the coup tary Fund didn't do much to alleviate the was welcomed by most Gambians in the capi­ economic misery, and a number of anti­ tal Banjul, and received support from a government demonstrations occurred in large sector of the country's security 1981, several of them in the week before forces. The U.S. media had difficulties the coup. reporting about the insurrection since On October 30, 1980 Jawara banned two 40 -- Counterspy -- Nov.Bl - Jan.82 ' Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 legal political parties, the Movement for ons captured from the rebels were "for­ Justice in Africa/Gambia and Sanyang's eign arms that were not in the armory" SRP. Also, during October, several hun­ before the rebellion. Other U.S. media ac­ dred Senegalese troops entered The Gambia counts emphasized that the rebels were claiming that Libya was using The Gambia armed with Soviet weapons. This story, as a base to overthrow the Senegalese however, had to be discounted even by the government (see Le Monde, 7/31/81). Jawara regime. It conceded on August 11 Jawara explained the troop presence as that the Soviet-made Kalashnikov rifles part of "combined military maneuvers" af­ used in the coup had been purchased by ter he had first asserted that they were the Gambian field force itself. th�re to pay last respects to the head of The only foreign intervention that took Gambia's security forces who �d, been place in The Gambia was by Senegal, killed. At the time, according to Africa France, and England. France, which has Now (London), "elements hostile to the 1,200 infantry marine troops in Senegal, government began suggesting that Dakar was and dozens of military advisors in the planning an invasion if disturbances got Senegalese armed forces, all but controls out of hand." the Senegalese military. It is inconceiv­ These "elements" proved to be correct. able that Senegal, one of the most reli­ The invasion came less than a year later, able and willing defenders of French in­ and there can be little doubt that Jawara terests in Africa would have staged the would have been ousted without tte Senega­ invasion without French collaboration. lese troops. Jawara apparently asked Pres­ Likewise, the British Special Air Service ident Abdou Diouf to send in the troops (SAS) did its share to keep the British­ while still in London. Diouf claimed that installed Jawara in power. SAS played a his invasion was justified under an agree­ key role in crushing the revolt when it ment between the two countries signed on freed Jawara's wife Thielal N'Diaye who February 18, 1965 (the very day of Gam­ had been held hostage by the rebels. bia's independence) which obligates mutual Jawara himself acknowledged that he had assistance if one of the two governments· received "excellent technical advice" from faces external aggression. Senegalese the British on how to handle "certain del­ President Diouf and newspapers close to icate situations." (The London Times, the government argued that the coup was a 8/10/81) form of external aggression. Several Af­ President Jawara, who set up his head� rican newspapers and politicians - includ­ quarters in the Senegalese embassy after ing Nigerian Vice President Alex Ekwueme - returning to Banjul (under the protection declared that the intervention was a clear of fourteen sharpshooters of the Senega­ violation of Article 3 of the OAU (Organi­ lese mobile gendarmerie squad) on August 2 zation of African Unity) Charter which first announced that Senegalese troops prohibits interference in the internal af­ would leave The Gambia "as soon as the fairs of member countries. crisis is over." Several weeks after the It took the Senegalese troops several invasion , things look quite different. days to recapture all of Banjul. Reports Diouf continues to assert that Senegal's of casualties ranged from 300 to 2,000 security is linked to stability in The dead, and hundreds were wounded. Many of Gambia. The Senegalese occupation forces, the rebels, protected by sympathizers in whose actions were met with resistance and the population, especially in poor areas, resentment by a large sector of the Gam­ apparently managed to merge with the peo­ bian population from the very beginning, ple after being defeated militarily. Their seem to be digging in for a long stay. The supporters reportedly also were able to Gambia's own security forces have been hide away a large number of arms in sew­ dismantled, and Senegalese military and ers and trenches. intelligence officers are training new From the very beginning, Diouf and Gambian units. For all practical purposes, Jawara emphasized that the coup was "for­ Senegal is in charge of security in The eign inspired." U.S. Ambassador to The Gambia. Gambia, Larry Piper did his part to pro­ At an August 20 press conference, Diouf mote the theory of foreign intervention and Jawara announced plans for a closer when he stated at an August 5 press con­ alliance between the two countries. ference in Banjul that some of the weap- Jawara told reporters th�t. the coup at- CounterSpy -� Nov.Bl - Jan.82 -- 41

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tempt "opened our eyes to the need to go Senegalese party strongly condemned the further" in joining Senegal. One of the invasion, and, consequently, will be op­ first projects is the "integration" of the posed to Senegal's annexation of The Gam­ security and intelligence services. Sene­ bia. The same is true for Senegal's most gal has been pushing Gambia for over fif­ powerful Muslim leader who publicly de­ teen years to join in forming "Senegam­ nounced Diouf's invasion, obviously con­ bia." Gambia's English-speaking elite, tradicting Jawara who had urged crushing however, has resisted that demand out of the rebels because they were Marxists who fear of being simply annexed and domi­ "denied the existence of God." nated by the French-speaking Senegalese Thus, in spite of its military defeat, elite. But now, Jawara claims it is his the Gambian coup might turn out to have "duty" to find "a better form of coopera­ positive results for African liberation • tion which goes beyond the integration of movements. The case of the Senegalese in­ the security for·ces." tervention in The Gambia is not an in­ For the immediate future, the integra­ stance of one independent African govern­ tion of the two countries will satisfy ment aiding another one under threat of Jawara's desire for stability and fullfil external aggression. Rather, it was an Senegal's ann�tionist ambitions. It is unsuccessful attempt by opposition forces also likely to provide even more opportu­ to get rid of ,a government that had been nities for multinational corporate expan­ installed by European colonialists - in sion and seems to be in line with U.S. this case the British. The Jawara regime and West European regionalist designs. was rescued by another client government Realizing that colonialist domination of of a former colonial..power, the Senega­ individual countries is coming to an end, lese. Senegal's President Diouf, who is West European countries and the U.S. are also aiding UNITA forces in Angola, is playing key roles in creating regional dependent on French military assistance organizations (such as the African Devel- to guarantee the very survival of his opment Bank) which can be used to ma- government. Thus, the Gambian coup was de­ nipulate African countries. An integra­ feated through an intervention by proxy tion of Senegal and The Gambia 1 especial­ and teaches a sad lesson about the foreign ly if it includes full economic integra­ policy of Socialist French Pres�dent tion, is another step in the direction of Francois Mitterrand. Without French sup­ regionalization. port of the Senegalese invasion - in what­ However, the integration of the two ever form - Jawara's rple almost certainly countries also might serve to strengthen would be over. and unite progressive forces in The Gam­ bia and Senegal. All but one rightwing

Secret World Bank Blueprint for China by Walden Bello

China: Socialist Economic Development, a economic agencies. Acceptance of the gen­ World Bank document recently leaked to eral conclusion of the nine-volume study CounterSpy provides a candid picture of was a precondition for the granting of a how one of the key institutions of the in­ $200 million loan for technical education ternational financial system seeks to in­ in June 1981. The Bank mission took place tegrate the world's most populous nation • back into the capitalist world. The docu­ (Walden Bello teaches r-ural development ment was the product of a 17-person World at the University of California (Berkeley) Bank mission that visited the People's Re­ and is Direator of the Congress Task Forae public of China in the latter half of of the Coalition Against the Maraos Diata­ 1980. While there, the mission was hosted torship and the Philippine Solidarity Net­ by the Ministry of Finance and other state bJOrk.) 42 -- CounterSpy -- Nov.Bl� Jan.82

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 in a wider context of increasing U .S.-Chi­ Third World nations for capitalist markets na cooperation against the Soviet Union that are already shrinking due to "stag­ and Vietnam. Before he left the World Bank flation" and protectionism. The World Bank presidency on June 31, 1981 Robert prescription is, indeed, suicidal, for the McNamara had vetoed further aid to Vietnam protectionist wave among capitalist to appease the U.S. Congres.s while propos­ countries is increasing. As McNamara him­ ing a $9 billion loan program for China self admitted during the Conference of the over the next four years. United Nations Trade and Development Agen­ The main thrust of the World Bank report cy in 1979: "Since 1976 there has been a is the prescription of a pattern of "ex­ marked increase in protectionism in the port-led growth" for China - that is, to industrialized nations, and the pressures gear its manufacturing industries toward for even further restrictive measures are capitalist export nrarkets. strong•••• The devices utilized to11 provide Given t1ie shortage of foreign exchange, such protection hav� multiplied. 2 and the knowledge to be gained from ex­ To finance China's export-oriented posure to world markets, expansion of growth, the World Bank recommends that manufactured exports must have high pri­ the country assume a foreign-borrowing ority. The outlook is promising, given strategy that would have China's debt,out­ t1ie abundance of skilled tow-wage tabor standing go from $3.4 billion in 1980 to and the enormous potential for economies as much as $79 billion (in 1990 dollars) cf seate.1 by 1990. This would put China in the top Wage levels, according to the report, are group of severely indebted countries like much less than in Hong Kong and South Ko­ Brazil, South Korea and the Philippines. rea, and the World Bank predicts that The leverage that international financial "China's manufactured exports could grow institutions would derive from this condi­ at 10-15 percent in the 1980s if suitable tion would be enormous. policies are followed and if new markets Among other thing�, the report pre­ can be aggressively penetrated." China: scribes the introduction of capitalist Socialist Economic Development asserts, management techniques, more freedom for however, that tu be successful, "Chinese markets, moves away from price control , industries must produce goods styled and and more "freedom" for technocrats and designed for the world's bigger and more technical personnel. The objective quite open markets. To do this, Chinese manufac­ clearly is a gradual dismantling of the turers and designers need to be exposed to socialist economy. As the report admits, foreign manufacturing methods, product de­ the development strategy it proposes signs, tastes, styles and practical re­ "might tend to increase relative inequali­ quirements; and direct measures are also ty." needed to strengthen Chinese design �apa­ bilities." FOOTNOTES What all this means is a drastic reori­ 1) All footnotes, except when indicated, are from enting of many sectors of Chinese industry World Bank, China: Socialist Economic Development, Washington, D.C., June 1981. frqm serving domestic needs, as well as an 2) Robert McNamara, Addres• to UNCTAD Conference, intensification of the competi_tion among World Bank, Washington, 1979-:-p.10. Report No. lJCJl-CHA This is the World Bank's plan China: to incorpcrate China into the monopoZy capitalist system. Socialist Economic Development The Chinese government is nur­ rressing the report for obvi­ Document of the \\brld Bank ous reasons. Available from CounterSpy, The Main Report P.O. Box 647, Ben Franklin June 1, 1981 Sta., Wash. D.C. 20044, U.S.A. East Asia and Pacific Regional Office / $20 (add $1 for postage, $4 · FOR OFFICIAL USE ONLY airmail overseas.)

_CountePSpy -- Nov. 81_ - Jan.82 -- 43

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 The Ascher Memorandum: Marcos Plugs the Leak byRoberto Dela Rosa

(Ed. note: In earZy December 1980, Coun­ sought to belie World Bank control over terspy and the FiZipino soZida.rity group the Philippine economy, the months follow­ CongPess Task Force Zeaked a confidential, ing the publication of the Ascher memo WorZd Bank memorandum entitZed "PoZitiaaZ witnessed the Marcos regime trying every­ and Administrative Bases for Economic PoZ­ thing in its power to,win back a gold star icy in the PhiZippines," more popuZarZy from the World Bank. Marcos initiated pol­ dubbed the "Ascher Memorandum" (after icies and changes to deal with what the WiZZiam Asaher, the author of the report). World Bank called "potential problems." He The memorandum assessed the staying power lifted martial law, secured the techno­ of the PhiZippine dictator Ferdinand crats' role, made steps tc placate the 'Marcos. (See CounterSpy1 February-April, discontented national bourgeoisie, and at­ 1981.) Roberto DeZa Rosa, a Counterspy tempted to camouflage 'widespread poverty. supporter in the PhiZippines, traces the PhiZippine goVe!7U1/ent's responses to the FACELIFTING MARTIAL LAW: PURE COSMETICS Zeaked Asaher Memorandum.) The Ascher memo had expressed concern A glossy photo of World Bank Regional over the "increasing precariousness of the Vice President for Asia and the Pacific, current administration" which "could re=­ Shahid Husain, beamed paternalistically at sult in the lifting of martial law." Mar­ the Filipino public from the front page of tial law, it warned, had served its pur­ one of the Philippines' tightly controlled pose and "increasingly has become a lia­ newspapers. Husain - dining royally with bility." Marcos got the message: two Marcos and his powerful wife Imelda just months after the memo was leaked, �artial one week after the "lifting" of martial law was "lifted;" six months later, "elec­ law - "congratulated the First Couple on tions" were held. Not that the lifting the government's efficient management of meant much in concrete terms. Threats to the economy."l Embar:tassed by the leaked "national security" by "subversives" were Ascher memo, Marcos had Manila's newspa­ still reason enough for arbitrary arr.est; pers falsely- trumpeting World Bank confi­ the press remained clamped in the fist of dence in the Philippine economy. Articles its owners - Marcos' family and cronies. quoting World Bank publications that the Strikes were illegal in broadly defined Philippines was "one of the prightest "vital sec tors." Even Newsweek magazine lights in the region" due to the govern­ termed it a "cosmetic" lifting. ment's "impressive record in managing the The election was just as fraudulent. economy" riddled Philippine newsprint ad Marcos is said to have paid a member of nauseam for months.2 the pro-Marcos Nationalista Party, Alejo This was all part of a not-too-subtle Santos, to run against him. About a month public relations job to polish Marcos' im­ before the election, Santos resigned as age tarnished by the leaked Ascher report. Chairman of the Board of the Philippine The confidential World Bank memo examined Veterans Bank (where, by his own admis­ disturbing trends in the Philippines sion, he "was practicallJ an employee of which, it argued, were making Marcos' rule the J'.arcos] government" ) to become increasingly "precarious." At the same Marcos' major opponent. A threat of six time, the memo revealed the Bank's marked months imprisonment hung over any Filipino preference that Marcos himself and not an who failed to vote. But, for international elite opposition member - Benigno Aquino, public opinion, the World Bank could now for example - hold the reigns of power in cite both the lifting of martial law and the near future. Marcos is a dictator the election to claim that the Philip­ whose personal allegiance and institutions pines was a ''.democracy" resting upon popu­ have evolved to serve the bank well. lar support. Although the government-controlled media 44 Counterspy -- Nov.Bl - Jan.82

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RESCUING THE TECHNOCRATS felt that the World Bank voicing its fear was somewhat underhanded. After all, the Marcos is valued by the World Bank in policies provoking bourgeois opposition good part for the unsullied technocrats had been set -by the Bank itself as condi­ who underpin him. The World Bank was ex­ tions for a major loan. (That fact was tremely concerned, as Ascher noted, about neatly glossed over by the Ascher memo.) "the vulnerability of the technocrats in Marcos himself had sought earlier to re­ retaining their economic policy management voke some of the policy changes that were positions if the administration should eliciting this vehement protest from do­ change." These young graduate-educated ad­ mestic entrepreneurs, but had given in ministrators brought in by Marcos are the under World Bank pressure. inside allies who enable the World Bank to Discontent among the national bour­ have as much influence as it does in de­ geoisie presented enough of a threat to termining Philippine economic policy. require Philippine government-World Bank Should Marcos fall to an _opposition talks on a remedy. As revealed recently leader who dismissed many of these techno­ by a Philippine government official, a cratic allies, might not World Bank de­ solution was quickly hammered out. The signs on the Philippines be seriously government, far from making real changes, crippled? The Ascher Memorandum perceived was to,remain on course with World Bank a way out: the technocrats could, in an programs contrary to the interests of the altered environment, become a political national bourgeoisie. At the same time, it force, and ultimately one of their ranks was to create a mechanism which would al­ could succeed Marcos. low it to feign concern for the bourgeoi­ Enter Cesar Virata, Minister of Finance sie's plight. and the World Bank's and the International "Consultations" became the new key word, Monetary Fund's closest Philippine friend, and the months of March and April saw the confidant and trusted technocrat. Under government initiating numerous "consulta­ the new parliamentary system, Virata as­ tions" with the domestic business sector. sumes the prime ministership for at least As part of this program, Manila's finan­ the first year of Marcos' six-year pr esi­ cial newspaper Business Day set up a two­ dential term. Virata's appointment signals day conference (with government prodding) an almost certain end to the World Bank at which members of the national bourgeoi­ fear of a violent succession crisis should sie could pay one hundred dollars a day to anything happen to �.areas. As prime minis­ hear government officials explain why ter, Virata becomes head of a seven-person Marcos' economic program was in their best executive committee which includes the interests. Concomitantly, the Marcos-con­ leading technocrats and on whose lap the trolled press inundated the public with pres.idential powers will fall should articles stressing the futility of moder­ Marcos be eliminated. ate businessmen aligning with radicals. The regime went so far as to suggest that PLACATING THE NATIONAL BOURGEOISIE Lenin be quoted and distorted by colum­ nists who argued that communists, by defi­ The central thrust of the Ascher Memo­ nition, manipulate nationalist entrepre­ randum was its prophecy of accelerating neurs to extend communist victories. domestic opposition to the deepening transnational corporate (TNC) penetration POVERTY: CAMOUFLAGE IT! into the domestic economy. Marcos' recent spate of generous incentives fer foreign The Ascher Memorandum recognized the corporations' trade and investment was un..:. "almost universal perception in the Phil­ der heavy attack. The World Bank's worry: ippines that the income distribution is should the national bourgeoisie, the do­ deterio.rating." Since 1972, Marcos' public mestic class devastated by the TNC expan­ rationalization for restricting certain sion, transform complaints into political basic freedoms had been that his "New So­ demands and join forces with the more na­ ciety" program marked a shortcut in pover­ tionalistic and radical opposition, it ty alleviation. The brutal reality, how­ could spell the end for World Bank plans ever, was tr�t after eight years of mar­ for the Philippines. tial law, average Philippine nutrition Privately, some government officials levels had fallen to the second lowest in Counterspy -- Nov.Bl,- Jan.82 45

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Asia after Bangladesh. And, if there was responded to World Bank criticism just as less freedom and less bread, the World quickly and decisively - but, lacking In­ Bank could well grasp that it was likely donesia's massive petroleum cushion, in a "to detract from the popula-rity of the different direction. Rather, Marcos metic­ Marcos administration." ulously carried out World Bank suggestions �s a remedy, the Ascher Memorandum coun­ in hopes of currying favor and keeping the sel!ed the Bank to exert "greater pressure Bank from channeling its support else­ on the administration to alter the reality where. an� perceptions of income concentration." A Filipino privy to high level internal Th�s solution, needless to say, did not Philippine government discussions ex­ set well with the Marcos regime, but a plained the reaction. The regime, he said, compromise of sorts was.worked out - if "looked at the �scher] report as an at­ the reality could not be changed; at least tempt to protect the reputation of a the perception of that reality could be. friend. We wanted our reputation pro­ Toward this end, presidential spokesper­ tected. So we heeded the advice." son Adrian Cristobal called together the 'l'he strategy, it seemed, worked smoothly writers who were working on what will be - at °least in the short term. In reward billed as Marcos' latest book, Progress. for in:itiating the changes well in advance The president, the writers were told, had of Marcos' June 30, 1981 inauguration, the expressed dissatisfaction over the initial Philippines was graced by the presence of drafts. His instructions: cite more for­ Vice President George Bush at that event. eign sourc.es showing that poverty had de- . Bush 'toa&ted Marcos, saying, "We stand by creased since the declaration of martial the Philippines •••• We love your adherence

law. The writers hesitated. It was an im­ to democratic5 principles and democratic possible task, they �laimed. Well then, processes. 11 suggested Cristobal, go to the rural areas Memo author William Ascher would have for a day and create your own evidence to applauded. But George Bush may eat his argue that the peasants' state has im­ words, as did Jimmy Carter after, his infa­ proved. So they did. mous - and glaringly similar - New Year's toast to the Shah on the eve of the Irani- · !, GOLD STAR FOR THE PHILIPPINES an revolution. When, following �he Ascher Memorandum FOOTNOTES: revelations, Counterspy magazirie leaked a

World Bank report on Indonesia criticizing 1) Bulletin Today (Manila), 1/21/81. the government's �conomic policies, the 2) Ti.mes Journal (Manila), 2/25/81; --Times ---Journal, 2/4/81; Indonesian government reacted quickly and Business � (Manila), 2/17/81. 3) Philippine·Liberation Courier, 6/81, p.2. decisively. Indonesian Central Bank files 4) Far� Economic Review, 7/10/81,�p.8.; see --Counter- suddenly were flaced off limits to World !Ez', May-July 1981. Bank missions. The Philippine government 5) Far Eastern Economic Review, 7/10/81, p.13. attacks by the right-wing against Counter­ FROM THE EDITORS §p]i_ (severat Congresspersons repeatedly If yoUl' label reads "R61" or "L61", this named Counterspy as one of the reasons HR4 is your> t.ast issue of Counterspy - ,so - the "Intelligence Identities Protection please rene� right �ay and don't miss a Act" - had to be passed) we need your sup­ single issue. port more than ever. We atso urge you to Counterspy is one of the very f� maga­ help us distribute Counterspy, and to in­ zines that has not raised its subscription fo'I'm the media in your area about the priae in the last three years in spite of grave danger HR4 and -its Senate counter­ inczteasing printing, mailing, and produc­ part present to the freedom of the press,, and to w"hat is left of "democracy" in the tion costs. And t.i.'e "have1 rzo pt.ans to raise it in the near future. rie wnt to make · U.S. . sure t"hat you won't "have to stop subscrib­ (For our subscribers, we are enc"losing ing because Counterspy is too eg::pensive. a promotionat brochure for MERIP Reports Ho�ver, if you can add some dollars to �th this issue. We are sure that you'll your subscription renewl or give us a find MERIP's reporting on and ana.lysis of contribution, please do. With stepped-up events �n the Mid.dle East useful.) 46 Counterspy -- Nov.Bl - Ja:n.82

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 World Bank Counterinsurgency in the Philippines by Walden Bello alll John Kelly

A forthcoming book, provisionally enti­ ties first ..•• FundamentaZ to the effort tled Development Debacle: The World Bank is getting to them first--ahead Qf_ the in the Philippines to be published jointly subversives. [Emphasis added.] This by the Philippine Solidarity Network and means an irrmeJiate effort to expand our the Institute for Food and Development persorzaZ aontaat with ati the tribes and Policy charges that the World Bank is "in­ a tonger range program to address t'fzeir timately involved with the (Philippine] 111 problems and aonvinae them that the gov­ government's counterinsurgency program. eztr1111ent way is best.2 According to Development Debacle, the Bank works directly with the Marcos govern­ SAMAR ment's Integrated Aid Development (IAD). As its name suggests, IAD is suppqsed to On the island of Samar, the World Bank's provide a variety of developmental ser­ counterinsurgency role is even more mani­ vices to Filipinos. Instead, IAD (as its fest. IAD programming for Samar began in American counterpart, the Agency for In­ 1974; the same year signs of insurgency ternational Development (AID) often does) appeared on the island. In 1976, the Phil­ doles out counterinsurgency and repres­ ippine government created the Samar Inte­ sion. grated Rural Development Office at least partly in response to the escalating in­ MINDORO surgency. At the same time, 9,000 troops, including the notorious 60th Constabulary One instance detailed in Development De­ Battalion, were rushed to Samar. According bacle is the IAD project in Mindoro begun to·human .rights groups such as the Task in 1975. Among the key parties in that Force Detainees (the main human rights project are the Civic Action Croup of the agency connected to the Philippine Cath­ Philippine Army, a key counterinsurgency olic Church), these troops pillaged, plun­ unit; and the Presidential Assistant on dered and terrorized Samar. They estab-. National Minorities (FANAMIN). PAf,AMIN, lished fire free zones - raising again the with $600,000 from the World Bank, was to specter of Vietnam and My Lai. In these dispense medical and agricultural assis.­ zones, the· International Commission on the tance to 20,000 Manggyan families, Mindo­ Militarization of Samar reported, "any ro's indigenous tribal group. PAN.AMIN was non-military person is shot on sight. The also supposed to "grant legal titles for victims are ofter. farmers who have not re­ ancestral lands traditionally used by ceived word that their farm is r..ow so de­ these communities••.• " signated." Instead, PANAMIN created government-con­ In the midst of, this, the Samar Develop­ trollec reservations not unlike the stra­ ment Office began negotiations for financ­ tegic hamlets of Vietnam. The objective, ing with the World Bank and the Australian of course, was to totally control the and Japanese governments. As a World Bank Manggyans and cut them off from revolu­ press release explained, the Bank and the tionary forces. In fact, a leaked PA..�AY.IN Australian projects are coordinated and docum.ent admits its counterinsurgency complementary. "The rsamar] project is role. part of the overall development plan for With the sucaess of the an.ti-subversive the island and complements separate pro­ campaign in the cities, the sub.:ersivee jects being assisted by the Government of n0u.· wi U seek sanctuaries eecure from Japan and Australia." government foraes. 1;he remote areas in­ The counterinsurgency input of the Aus­ habited by the tribes offer many hetto.ens tralian component was admitted in a confi- _ (sia) ..•. It wouZd be tragia if the ene­ dential memorandum of �he Australian De­ mies of the Republic succeeded simply velopment Assistance Bureau leaked by because no one eZse reached the mincri.- World Bank employees. The area referred to Counterspy -- Nev.Bl - Jan.82 47 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 fs precisely where the mobility of the velopmentJ project designed to benefit the 60th Constabulary Battalion has been se­ poor with nearly all that money going to verely restricted. road building and port improvement." The Far East coast of northern Samar, i. e. , the Manapano-Gamay-La.pining area is FOOTNOTES at present entirely isolated from the rest of northern Samar with access lim­ 1) All references, u·nless otherwise indicated, come from the chapter on rural development of the book provisionally ited to ocean going pwrrp boat when entitled Development Debacle: The� Bank in the Phil­ weather pennits or to foot travel. It is ippines, scheduled'for release in late 1981. Authors are Walden Bello, Robin Broad, Vincent· Bielski, David thus almost impossible for authorities Kinlay, and David O'Conner. The documents on Samar were to provide adequate edu.cation, health or leaked· to Counterspy and the Congress Task Force (CTF) and were released at a press conference on September 1, 1981. security services in the area. As a con­ 2) PANAMIN, mimeographed confidential report, undated, sequsnce, even though construction qi_ provided to Counterspy and CTF by a Filipino source. the road woiifd be difficult and expen� 3) Australian Development Assistance Bureau, ,Briefing aria Notes and Project Documentation for Selected Consultants, awe �·erha.psnot strictly justified Northern Samar Integrated Rural Development Project, fu_ Philippin;;-=-Australian Development Assistance Program, econom1,c argument, it is interi4ed September 1978, p.17. that an early start be mcide on th1,s 1'­ 4) The World Bank project is detailed in: World Bank, twn qt the East Coast Feeder, rega -j//.­ . Samar Rural Development Project Appraisal Report, Wash­ less qtecoriiim-fa prioPities. 3 (Emphasfs ington-:-0:C., November 1979. added.) WORLD BANK DOCUMENTS For its part, the World Bank is concen­ trating on Eastern Samar where four gov­ WORLD BANK POVERTY REPORT ON THE PHILIP­ ernment battalions are carrying o t, exten­ PINES i o sive search-and-destroy missions. The Acc rding to the Far Eastern Economic Review (3/27/81) this report created Bank is financing the revamping of the o port of Catbalogan and improvement of "c nsiderable dis-quiet about the way things are going in the Philippines." 2001ans. of the coastal road. At the same time, the International Commission on the FEER also revealed that after Counterspy leaked -the report, the World Bank pro­ Militarization of Samar ,stated, two mili­ o tary engineering battalions have been vided Marc s with a revised version less "building roads and airstrips which have a critical of the government. In the pub-· primarily strategic value." According to a lie interest, CounterSpy is making first hand report cited in Development De­ available the original report. ($15) bacle, "the regime has been pushing the WORLD BANK REPORT ON FOREIGN INVESTMENT construction of many large ports for the - o IN IlWONESIA boats f the Philippine Navy,_airstrips o o o Acc rding to FEER: '.'Ballk fficials have f r the planes of the Philippine Air o o worked hard trying t keep the sole Force, and highways f � the quick movement o o o leaked c py f the draft •.. from appear­ of tr ops." ing in the press." (5/29/81) Read what o The relevance f the Bank's financing to the World Bank did not want you to read o o o the needs f the pe ple of. Samar, ne of about Indonesia; a report that forced the poorest Philippine islands, is not '' Suharto to personally issue a major na­ readily appar'ent. Indeed, Development De­ tional address. ($20) bacle quotes ·a middle-level Bank staffer who has said as much: "Don't think we're WORLD BANK REPORTS ON SOUTH KOREA How blind. , could anyone fail to see that Two confidential Bank reports including the Samar stuff had military potential, the Bank's five-year plan for South Ko- o with all the news ab ut a military build- rea. The second report admits that Pres­ up in 1979?" This same person further re- ident Chun is more repressive than h s o o i ported that n two separate occasi ns (at predecessor but will be fully supported a "decision meeting" in mid-April 1979, by the Bank. ($20) and at a key Executive Directors meeting , (Add five percent for postage in tr.e in December 1979) l-:orld Bank officials ex- U.S.; 15 percent overseas airmail.) pressed concerns about the military sig-· 1 nificance of the project. While Bank Reports are available fro m CounterSpy, higher-ups claimed "political neutrali- P.O. Box 647, Ben Franklin Station, ty," one Executive Director did <].Uestion Washington, D.C. 20044, U.S.A. "whether this was in fact an RD LRural De- L------48 CcunterSpy --.Nov.Bl - ,Jan.82

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Interview with Ian Adams RCMP Demystified

Ian Adams, a Toronto-based journalist interrogated John Watkins, the former Ca­ has W!'itten widely on the Royal Canadian nadian ambassador to the Soviet Union,in a Mounted Police (RCMP), Canada's intelli­ Montreal hotel room on October 12, 1964, gence agency. Counterspy interviewed Adams and that Watkins died while under interro­ in August 1981 and revised the text·uJith gation. The story they'd put out befo.re him in late September. Adams' most promi­ was that the Security'Service hadn't been nent work is the novel S: Portrait of a there, and that Watkins had died at din­ §E1L (Virgo Press, 69 Sherbourne St., Toron­ ner, or something like that. to, Ontario). ''S" is an important work for someone trying to understand the "pow­ Your book, even though a novel, raises ers-that-be" in Canada and U.S.-Canadian many questions about the nature of the intelligence relations. RCMP and portrays it as a somewhat undemo­ orutio institution. Do you think that a Counterspy: The paperback edition of novel was the only way tr.at questions Zike your book, S: Portrait of a Spy is billed that oould have been raised at the time? as a "devastatirig bestseller." What is Yes. Let me go back a bit to how I first devastating about the book? got started writing about the RCMP. In Ian Adams: Well, devastating wouldn't be 1973, I was covering the coup in Chile. I my word, but I suppose what makes it became aware of the liaison between the unique in Canadian terms is that it was RCMP and the CIA in Chile. And that came the first book ever, fact or fiction, to about because the Canadian government ut be written about the RCMP Security Ser­ p vice. Hundreds of books have been written out the official story that no Chileans �anted to come to ref­ about the CIA, the British MIS and about Canada as political ugees. Meanwhile the contrary was true. I the KGB, but no book has ever been written about the RCMP Security Service. "S" is went to the Canadian embassy in Santiago every day, and it was just jammed with also unique in that the book itself became people trying to get out of the country the catalyst for the former head of the through what they thought would be the Security Service, Leslie James Bennett, to neutral offices of the Canadian embassy. launch a libel suit against me. He charged Some of the people who tried to get exit that "S" was a fictionalized version of his own career. And in the course of the visas were �ell-known, including prominent labor people. pretrial process we learned something that It was about three weeks after the coup; had never been revealed before in Canada: things were quite desperate. The �ational that Bennett had indeed been suspected of Stadium was full with 14,000 political being a spy and had been interrogated by prisoners, and the smaller Chile Stadium the Security Service at great length. held another 4,000 or so. People were des­ Are there other details that have aome perate to get out of the country. Well, to light in the Bennett oase? what t�e Canadian government was doing, Well, just recently Bennett was inter­ apparently, through the RCMP Security Ser­ viewed by the Australian Broadcasting Com­ vice, was giving the CIA the names of the pany TV. He seid a number of remarkable people who were trying to get out of the things, and charged that a death squad had country. At that time, the CIA r�d the been established by the RCMP to get him if most extensive documentation on wbo was they ever obtained proof that he was a who on the political scene in Chile. Pres­ double agent. Bennett said he'd been ident Allende's personal bodyguard, Grupo warned about this by a fellow RCMP officer Amigos Personales, had infiltrated In­ he'd known for a long time. The other vestigacciones, the police force, and de­ thing that came out was that Bennett and stroyed most of their files on the politi­ RCMP liaison officer to the CIA, Inspector cal opposition. So the U.S. embassy had in Harry Brandes were among the people who its hands the most complete files. Counterspy -- Nov.Bl - Jan.82 -- 49

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I reported all this, and the stories ever been informed as to why and how. And were published by newspapers and magazines it came out through my pretrial process in Canada. The reaction was incredible. that he indeed had come under suspicion of The Department of External Affair's phoned being a mole, that he had infiltrated the up the editors and complained about it, Security Service for Soviet intelligence. and the RCMP complained bitterly because I had .identified RCMP officers who were down The novel portrays the CIA-RCMP rela­ there. And then t�ings became quite diffi­ tionship as one in which the CIA is clear­ cult for me. Some writing contracts I had ly the dominating force. Going from the were terminated. It was difficult for me novel to reality, is that the way you to get work. 'fhe RCMP put out the story 'would describe the actual relations be­ that I was a member of a "subversive" or­ tween the CIA and the RCMP? ganization, which is totally untrue. I Well, recently it may have become a bit have never belonged to any p9litical orga­ more sophisticated. However, it wasn't nization. But some newspaper editors be­ long ago that a CIA man could more or less lieved it. So there was a smear campaign just give orders to a Security Service of­ and I said to myself, I have to find out ficer without any consideration that he.or more about these guys in the RCMP.- she was an officer of a foreign intelli­ I had been a journalist in this country gence apparatus. I think that to some de­ for about ten or twelve years, and I gree that has changed. But the agreement didn't know anything about the Security between Canada and the U.S. in regards to Service, nor did I know any other jour­ sharing secrets' is totally dominated by nalist who did. But I just knew t�ey had the U.S. intelligence, p�rtly through the enormous power. Obviously,they did, if ability of the CIA an4 the National Secu­ they could pull things like the campaign rity Agency to obtain enormous amounts of against me. I. began to slowly build a body raw data - which they selectively share of information on the structure of the with the SecurityI Service. RCMP Security Service, to make contact with people who had ret�red from it, who Beside the incident in 1973 in Chile, were disgusted, and with people who had were there other times when the PC�fP did been harassed by the organization. Through some of the CIA's dirty work? all that_research I discovered two issues, A lot of middle management deals occur that kept coming up all the time. One, no all the time. For example, when the CIA other international intelligence organiza­ has an agent that's too hot somewhere in tion trusted the Security Service, they Latin America, the RCMP might make it eas­ sort of were considered "sick" - sick ier by allowing the· agent to cool off in being the parlance in intelligence terms this country. for an organization that's been penetrat­ And then you have the Warren Hart ar­ ed; and two, never in the history of the rangement. Hart came from the U.S. to Ca­ RCMP Security Service had they ever nada to infiltrate the Black movement, and caught a spy. also tried to infiltrate the Native Indian movement. But everyone knew he was an And that's �hat they are supposed to do? agent. He was too obvious, and it was a Yes. Their primary function is counter­ joke among people h�re. I went to a meet­ espionage, counter-intelligence, and sur­ ing once dealing with the occupation of a veillance of foreign intelligence organi­ park by a militant political group. Hart zations that operate in Canada. They're was there, and he was openly drawing dia­ supposed to track down the spies - they've grams of bombs and passing them around. He done all kinds of things against progres­ was the most indiscreet agent they've ever sive Canadians - but they've never caught turned loose up here, but he was around a spy. So I put that together to suggest for quite a while. People would say to a that the classic situation had occurred - well known Black leader, whom Hart was the Security Service had been penetrated. supposed to• spy on, "Hart is an agent, why Now strangely enough, when "S" came out, do you keep him around?" This guy would there was this reaction by Mr. Bennett, reply, "listen, I don't have any money, I who was the former head of counter-espio­ can't pay for my apartment. I don't have a nage, and who had retired under very car, and he has one and drives me around." strange circumstances in 1972 - no one had This, of course� was a bit naive. 50 -- Counterspy -- Nov.Bl - Jan.82

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Hart appeared again in a very strange and hated on most of the reservations. In case, though, which still hasn't surfaced, the provinces which have their own provin­ and that was the Canadian Space Research cial police forces, that's Ontario and Corporation case. Quebec, the RCMP has responsibility in terms of immigration and drug enforcement, Is tha.t the corporation tha.t was selling and certain federal responsibilities such arms to South Africa with the help of the as tax fraud and, of course, national se­ CIA? curity. The major activity of the RCMP Yes. The man who was directing internal Security Service, along with military in­ security at Space Research was a former telligence in Quebec, outside these feder­ RCMP Security Service officer. His name al functions, has been focused on the Que­ was Don McLeaty.And lo and behold who bec drive for independence. turns up as the man on Antigua where Space Research was smuggling from, as the public What about RCNP connections to the me­ relations man between the corporation and dia? .You pointed out tha.t it t.t'as a well the local people but Warren Hart. Now it organized job that was done on you. Can seems that Mcleary must have been one of you identify specific media outlets in Ca­ Hart's case officers when he was in Cana­ nada tha.t are used by the RCMP? da. And they later employed him on this It's a very insidious thing. Even what job in Antigua for Canadian Space Re­ is supposedly the most responsible news­ search. So all these connections exist, paper in Canada, the Toronto Globe and and who knows who takes the responsibili­ Mail, has a reporter called Peter Moon, ty, and at what level the executive of who's sometimes referred to as Corporal the CIA and the RCMP are involved. Moon. His job is.basically to get as close to the RCMP as possible, and get as much Wculd you say that the CIA treats Canad.a information from it as he can without ever as -some sort of extension of the U.S.? being critical about it. Whenever the Sure, and because it's outside of the Globe and �..ail makes up its mind to write U.S. they do n't have to worry about their something critical about the RCMP, when mandate. Just one reason they're here is things become so obvious that they have to the labor union structure in this country, report something, it's assigned to another reporter. The other reporter usually gets which is an extension of the American wirned unions, and the CIA and the RCMP have a on the assignment and subsequently very strong interest in the union struc­ has to take a bureau job in another city. ture and in the "legitimate" left such as There has always been a fearful rela­ the New Democratic Party, tionship between the media and the RCMP which I think comes from the colonial men­ OriginaZZy the RCMP was set up to p1•0- tality which still exists to some extent mote w�ite expansion into the West, push­ in Canada today - the publishing world in ing out native peoptes. Does the RCMP Canada has always refused to take upon it­ stiU play a major role in the suppressfon self the kind of responsibility and power of Native peoples? that it potentially could have. In the The RCMP operates as a contract police U.S. you have corporate publi.shing with force for ten of the provinces, only Que­ all its problems, but at the same time bec and Ontario have their own provincial it's not always going to let a government police forces which would be similar to agency dictate what it should and should the state troopers in the U.S. So at not say. that level the RCMP functions as the pro­ vincial police. In British Columbia, Al­ Cne newspaper with RCl.fP ties t1zat you berta and Saskatchewan where there are point out in ''S'' is the Toronto --Sun. What heavy concentrations of Native people is the nature of these ties? their job is to keep those people down•.• Sun editor Peter Worthington has had because of White society's encroachment on quite close connections with the RCMP Se­ the land and resources of the Native peo­ curity Service for years. That was re- . ple. vealed by Bennett during the libel suit. The RCMP has historically had the func­ He had known Worthington for fifteen years tion of keeping the lid on Native dissent, or more, and had used him as a pipeline and for that reason they're deeply feared for information. In most other countries, Counterspy -- Nov.Bl - Jan.82 -- 61

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 ' Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 a revelation like th�t would have started cal role that to question it in any way a debate about the ethics of journalism. is almost to commit political suicide. In But in this country the media wasn't in­ a way, the Mountie is the last mythical terested. The nature of the Sun, a tab� figure in our society. loid, is "tits and crime," very rightwing, re-evoking, all that 1950s Cold War non­ The RCMP has this "c'lean" image even in sense. the U.S. where the figure of an RCMP of­ ficer in his scar'let uniform is used by Here in the U.S. we are witnessing Windsor in their ad.s for Canadian whis­ what's caUed an "un'leashing" of the CIA; key; the officer is usua'l'ly on a horse, invo'lving an inarease in covert opera­ somewhere in the wi'ld, und.er the caption, tions. It's questionab'le whether the CIA "One Canadian Stands A'lone." has ever been 'leashed; but anyway, does About four months ago, I went acr.oss the this resurrected Co'ld War-atmosphere, country on a speaking tour. I went from �hich ca'l'ls for strengthening inte'l'ligence city to city doing interviews on radio and agencies, a'lso e:x;,ist in Canada? TV stations, and discovered there's almost Since there's such a close collaboration a generational difference in attitude - between the RCMP and the CIA, that's also any TV or radio host over forty tended to happening here to a certain extent. Let me try to put as much distance between them­ go back a bit. In the early 1970s when a selves and me as possible to make sure lot of draft resisters came to Canada, the that their audience would not in any way CIA and the RCMP developed strong middle­ think that the host condones this investi­ management functions in terms of exchang­ gation of the RCMP. Younger persons were ing information about political organiza­ much more matter of fact. tions and "dissident" groups on both sides The RCMP myth is so strong in our.coun­ of the border and using their agents to try because we're a country that has so infiltrate groups on both sides of the few myths. 'rn a time of high economic anx­ border. And, of course, Canadian intelli­ iety and great political uneasiness, peo­ gence officers are always attending CIA ple start to hold on to myths, especially courses in Langley. those related to law and order. To start Now, as in the U.S., there have been questioning these myths is to create even commissions investigating the RCMP. The more anxiety. That's when the public turns McDonald Commission into the RCMP's ille­ against the bearer of "bad" news: the com­ gal activities has just reported its find­ mission investigating the RCMP, or the ings to the federal government. The evi­ newspaper that's writing stories about it. dence is pretty damning. The Commission Psychologically one can understand the recommends that the RCMP Security Service phenomenon, but it doesn't do much to ad­ be disbanded, and a civilian agency simi­ vance our cause. lar to the CIA, but with responsibility to both domestic and foreign security, �1hat do you think are the main issues be established. However, there's no guar­ between Canada and the U.S. today? antee of civil liberties in these struc­ The Canadian dollar has collapsed in the tural changes. In fact, the government last few days. Part of the collapse, Fi.-,, will through legislation make it legal nance Minister Allen MacEachen claims, is for the secret police to break in, tap , due to the fact that some Canadian corpo­ phones, and open mail. rations are trying to buy U.S. corpora­ tions. But I don't think it's as simple as What kind of organized opposition is that. There's a sustained campaign going there to RCMP excesses? on at various levels against (Prime Minis­ Well, there's really not very much. One ter Pierre] Trudeau's energy package which organization, the Law �nion, a national aims to Canadianize our resources. The at­ group of lawyers who are a minority group tack on the Canadian dollar which has as opposed to the Law Associations, con­ really shaken up the country has put tre­ sistently puts forward a position which mendous pressure on the government. We had says the RCMP should be more heavily po­ this incredible statement by MacEachen a liced. There are also· some political few days ago when he asked the banks not groups in Quebec and otlier provinces. But to lend money to Canadian corporations who in Canada, the RCMP enjoys such a mythi- want to buy U.S. corporations. S2 -- Counterspy -- Nov.Bl - Jan.82 (cont. on page 54)

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Is the U.S. Destabilizing Canada ?

Referring to Prime Minister Pierre be hurt by Trudeau's energy plan, the Trudeau's plan to buy back about one-third U.S. government should step in. If the of the Canadian energy corporations pre­ government of Canada "detePminee to use sently owned by U.S. companies, the Atlq.n­ its very considerable powers" to control tia Council warned in a July 1981 study and direct tr.e eaoriomia :relationship be­ that'"the new energy program... aasts aon­ tu,een the two aountries "in a manner it siderable doubt over future general energy deems helpful to Canada, the U.S. Frivate cooperation" between the U.S. and Canada. sector and the U.S. government must ... The Atlantia Counail further warned that·· determine whether or not the effect is oil and gas production in Canada might be detrimental to their interests, and de­ impeded. Presently, about 80 percent of aide, �f necessary, on an appropriate Canada's energy resouraes are owned by aourse of remedial action." U.S. multinationals. As of Oatober 1981, there is little U.S. Poliay Towards Canada: 'The Neighbor doubt that the Reagan administration has We Cannot Take for Granted was written by decided to take "remedial action," sinoe the Atlantia Counail's Working Group on U.S. aor-porate offiaials have aomplained the United States and Canada whioh aon­ bitterly about Canadian plans to buy baak sists largely of foPmer U.S. government some of their o�'TY! resouraes. Time maga­ offiaials and corporate exeautives with zine commented tria.t the "real victims" of finanoial interests in energy and raw ma­ the energy program are U.S. aompanies terial development. Given the Counail's that r.ave "invested approximately $10 board of directors at the time of its billion in Canadian... energy enter­ writing (inaluding present Searetary of prises. " Before they went into swrme:r> State Gen. Alexander Haie, CIA Direator recess, t1iJO U.S. Cong:r>essional committees WiUiaJr1 Casey, Henry Kissinger and Paul passed bills against the Trudeau program Nitze) the paper undoubtedly has been - one would impose a nine month moratori� studied alosely by the Reagan administra­ um on the purchase of more than five per­ tion. aent of the voting stock of U.S. enerigb The Atlantia Counail paper clearly ·f �cmpariies by Canadian corForations. voices its aonoern about the Canadian en­ In swrzn,er 1981, the Reagan administra­ ergy program - "Canada's economy is noi; tion mailed qu�stionnaires to the execu­ moi•e subject to government direction arr.d tives of the 500 largest U.S. corpora­ aontrol than has been the aase ... in the tions asking them about their problems in past," - and is equally open about the dealing i.;ith the Trudeau 9overnment. The U.S.'s desire to further• expand aorpc,1•ate administration al.so threatened "tough investment in Canad,a,; :'The United States retaliatory sanaticns II aGai.nst Canad(l. if needs Canadian :r•esouroes, Canadian mar­ it aonUnues its nationalization plans. kets, and cppo:rtum:ties for investment in One of the retc.liatcry actions being con­ Cana,d,a,." sidered by the administration is to in­ In a key statement, the Council urges voke a seation of the 19?4 Trade Act the U.S. govePnment to "seek to assure which gives the president the po1.. ,er to that energy projects affecting both alter all trade agreemen�s with Canada. oountries are handled tJith genuine reci­ Gi1'en U.S. aontrol over Canada's eaonomy prooity.".In other words, the Reagan ad­ ( aooording to the Atlantic Ccunail "Cana­ ministration should oppose and take steps da is the locus of the largest proportion against Trudeau's energy prog1•am which of American fore.ign investment"), it favoi•s Canadian over U.S. aompan-Zes as wouldn't be too difficult for the U.S. to developers of Canad,a,'s vast energy re­ wreak ecor.omia havoc in Canada. For the sources. Trudeau government, it appears, a cruaial The Counoi l is surpriisir.gZy f1•ank in time has come. It is beir.g foraed to dem­ desaribing its attitude toward vho should onstl•ate ho�' serious it is about its have the final say about Canada's energy plans to control Car.ada's ow'rl resources. development: If U.S. corporations are to Counterspy -- Nov.Bl - Jan.82 -- 53 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

I have a theory that the CIA and the trarily nationalize our resources but just, State Department are out to punish us for buy them back, aft,er years of being ripped daring to want to own and control our own off. There are other reasons why the energy industry. And part of this concert­ Reagan government would want to bring Ca­ ed attack is to bring down the Trudeau nada in line. They want all the rest, they government, just as they brought down the want our water, they want the rest of our Whitlam government in Australia in 1975. power. There's a scheme to set up nuclear U.S. corporations control about 80 per­ rower stations north of the border to _sup­ cent of our resoqrces, and the U.S. in­ ply electricity to the U.S., so that all vestment in Canada i� something like $90 environmental problems are shifted out of billion. Now in Chile it was about $6 bil­ the U.S. lion, I think. Look at the length the CIA �nd ITT went to save and protect that in­ What is the time frame of the Trudeau• vestment. Obviously they.'re not going to program to buy back Canada's resources �tand by and allow the democratic process from U.S. corporations? to take place here, even if we don't arbi- It's supposed to be the objective of the licly identified, in parti�lar Richard Australia 1975 Stallings, a CIA empZoyee in charge of the ·u. S. intelligence faaility at Pir,,e Gap and a close friend of Anthony's. At first, the Australian establishment The CIA was e:rtremeZy worried and con­ -I media ridiculed ac�sations that the CIA cluded that further discussion about U.S. had played a leading role in the·ouster intelligence in Australia could "blow the of the Labor Party government of Prime Ud off" the instaZZations where the Minister Gough Whitlcon in 1975� But evi­ named CIA officers had been working. Th.e . dence that has come to Ught since then CIA also warned that if the existing strongly indicates that the CIA was very problems - that is publicity about U.S. interested in getting rid of Whitlam and intelligenae facilities in Australia and played a key role in his ouster. WhitZam's questions about the CIA - Whitlam was dismissed by Governor Gen­ "aannot be solved the CIA does not see eral Sir John Kerr in a "constitutional how our. mutually benefitting relation­ coup" in November 1975. (Kerr used an ar� ships are going to continue." In effect, chaic constitutional power which, al­ the top secret CIA cable stated that the though it may have been technically le­ Australian Prime ilinister was posing a gal, had never been. exeraised before in threat to U.S. inte"lligence bases .in Australia's history.) The CIA wa.nted AustraZi�. WhitZam out because, as a top searet aa­ On November 8, 1975 a senior Australian ble leaked to the Financial Review shows, Defen�e offiaer went to Sir John Kerr and it feared that Whitlam's government might info:rrmed him of this aable. Three days inquire into and publiaize the nature of later, Kerr dismissed Whitlam.. Interest­ U.S. intelligenae faaiZities in Austra.- , ingly enough, Kerr has longstanding ties Zia. Aacording to the fomzer head of CIA to the CIA and had been working with Aus­ counterintelligence, James Angleton, t1•alian military intelZigenae. Kerr these installations "elevated Australia played a prominent role in the CIA-funded in te:rrms of strategic matters unlike any Australian Congress for Cultural Freedom other similar installation that may be in and personally went to the U.S. in the any other plaae in the free lJOrld." The early 196Os to get money f1•om the CIA­ 1075 aoup came after several inaidents �n connected Asia Foundation for his Law As­ which, in the opinion of the CIA, �Thitlam sociation for Asia and the Western Pacif­ had damaged national security interests. ia. On November 2, 1975, for e:,;ample, flhitlam Like ·Canada, Australia is supposed to stczted pub'licly tr.at he knew that the CIA be a democratic aountry and a close ally had given money to the rightwing National of 'the U.S. And yet, the 1975 "constitu­ Country Party of Dough Anthony. In the tional aoup'' shows that these factors course of this revelation and general de­ don't prevent the CIA from intervening bates on the role of U.S. intelligence in anywhere it peraeives U.S. strategic or AustraUa, several CIA offiaers were pub- economic interests to be threatened. 54,-- CounterSpy -- Nov.Bl - Jan.82

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 eighties. They started PetroCan which is bourgeoisie, by selling out to U.S. corpo­ sort of the equivalent of the Mexican rations through the fifties and sixties Pemex, and they've bought a couple of and by the give-away of our natural re­ smaller oil companies. But those deals sources by successive Liberal governments, have been accompanied by scandals, and has created a very powerful and wealthy some people with ties to Trudeau's Liberal middle class. They're the ones who don't Party have made enormous profits. So it's want anything upset. They want to keep the business as usual with the Liberals: enor­ colonialist and imperialist relationship mous corruption is accompanying their so­ with the U.S. intact'because they are the called reforms. That's going to make peo­ management class who have benefitted so ple cynical ••• and there isn't really a enormously. It's the class that histori­ concerted attempt to take over the biggies cally turns on the government when the like Gulf and Esso. government, in the larger interest of the country, tries to regain control of our In the U.S. we have very Zittie news natural resources. The Liberal government about Cana.da, and peopZe were probabZy in our country understands this very more (JJJ)CJPe that the CIA and the corpora­ well, so their "nationalization" program tions were destabilizing ChiZe than they will only be in force as long as it is know that something might be underway just politically useful . north of the border. When I talk about U.S. destabilization Some Canadians are very sensitive about of Canada, I'm sure I'm going to be ac­ this, but I think the vast majority cused of paranoia and belief in the cosmic doesn't want to hear about it. They would conspiracy. But these things like the par­ like to have this comfortable colonial­ tial collapse of the Canadian dollar just ized structure continue. In the fifties don't happen.· Who would have thought ten there was heavy investment by American years ago that the CIA would oust the corporations that suddenly gave the Cana­ Whitlam government in Australia? Yet it dian bourgeoisie tremendous wealth. The happened. The British Right and Intelligence by Richard Shaw

Over the last decade, England has seen The influence of these institutes, which the rise of a number of powerful rightwing also maintain high-level contacts with "research" and "public policy" institutes. foreign rightwing and racist organizations These organizations include the Institute and governments, has spread rapidly for the Study of Conflict (ISC), the For­ throughout the media and cabinet-level eign Affairs Research Institute (FARI), governmental circles. Their strength is the :Monday Club, and the National Associa­ comparable to U.S. organizations such as tion for Freedom (NAFF, recently re-named the Heritage Foundation, the Georgetown the Freedom Association); each of which University Center for Strategic and Inter­ purports to be independent and ''obj ec- - national Studies, the American Enterprise tive." In reality, however, they have been Institute and the Hoover Institute in working closely with Western intelligence Stanford, California. The Monday Club, agencies and act as ideological conduits FARI, the ISC and NAFF contributed sub­ for a variety of disinformation and propa­ stantially to the rise to power of the ganda campaigns aimed at strengthening in­ present government of Margaret Thatcher. telligence agencies and rightwing parties and organizations. Some of thes� organiza­ THE INSTITUTE FOR THE STUDY OF CONFLICT tions have even received money from intelT ligence agencies such as the CIA. The ISC is a supposedly "authoritative" (Riaharu Shaw is a British freelance information center which commissions writ­ journalist.) ers to produce "factual" articles on in- CounterSpy -- Nov.Bl - Ja:n..82 -- 5£

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ternal security, mi11tary affairs and in- tion" came "into our writer Robert Moss's ' ternational communism. Brian Crozier, a hands." Moss and Arnaud de Borchgrave are CIA contract agent, founded ISC in 1970 as co-authors of the disinformation novel a "registered oharity" with about S.20,000 The Spike and leading "experts" on ter·­ "donated" by multinational corporation& 1 rorism. On the inside flap of The Spike, 1ike Shell and British Petroleum, plus its publisher Weidenfeld (British edi­ money from the U.S. National Strategy In­ tion) noted that Moss and Borchgrave have formation Center (NSIC) and Forum World had access to information from all major Features (FWF).2 In 1973, ISC received 75 Soviet defectors. Earlier this year, the percent of its funds from the CIA, and was two also boasted of having regular contact staffed·by what the U.S. Senate Select with the CIA and French intelligence on Committee on Intelligence called "CIA col­ (former CIA officer) William Buckley's TV laborators. "3 show, -''Firing Line�" At the same time that he founded ISC, In 1975, hundreds of ISC internal docu­ Crozier was in charge of FWF which ap­ ments were dropped anonymously in the.let­ peared to be just another news agency but ter box of Time Out magazine. The docu­ actually was in the "propaganda business." ments revealed regular contacts between An internal CIA memo to the then Director the Institute and rightwing regimes and of Central Intelligence Richard �elms, intelligence agencies around the globe, noted that in its first two years, FWF notably the Rhodesian secret service and "has provided the U.S. with a significant South Africa's BOSS. The documents also means to counter Communist propaganda and shed light on ISC's contacts deep inside has beco�e114 a respected features service the British establishment, even the Cabi­ net off ice. 7 ISC's U.S.-based supporter, the National Strategy Information Center, was founded GEOFFREY STEWART-SMITH in 19 62 by present CIA Director William Casey.5 One of its main activities, as' Beside having served as advisok to the Casey told the Senate-Intelligence Commit­ British Military ·voluntary Force which un­ tee, has been the building of "academic successfully tried to send mercenaries to responsibility" for the practice of intel­ the Cong�, Biafra, and South�rn Africa,8 ligence in various countries. The NSIC is former conservative Member of Parliament supported by the Mellon family, heirs of· (M.P.), Geoffrey Stewart-Smith is a pivot, the Gulf Oil fortune.6 al link between three somewhat shadowy ISC council members include numerous propaganda organizations. He :f.s the editor people with intelligence connections: Vice of East West Digest and director of For... Admiral Louis Le Bailly was Director Gen­ eign Affairs Publishing Co. Ltd. (both at eral of Intelligence at the British Minis­ 139 Petersham Road in Richmond), and di­ try of Defense from 1972 to 1975; Sir rector of the London-based Foreign Affairs Edward Peck is the former·head of the Se­ Research Institute (FARI). cret Intelligence Service (SIS) clantlesL· East West Digest is published twice tine operations in Berlin; Major General monthly. Its ideology is glaringly obvious Richard Clutterbuck (ret.) is regarded as in the table of contents of any issue. The one of those principally responsible for July 1980 issue (No.14), for example, con­ the British Army's counterinsurgency oper­ tained articles entitled "Toward a Western ati�ns in Northern Ireland; and Sir Robert Grand Strategy for Global Freedom," "De­ Thompson is a one-time Nixon favorite ad­ spite Carter's Words, High Technology visor and proponent of the "strate�ic ham­ Trade Continues with USSR," "Afghanistan: lets" concept of counterinsurgency war­ the Worst Reported War of Our Time," and fare. "Communist Gulags in Angola Denounced." As FWF's ideological he ir, the ISC re­ Free copies of the Digest are.sent to all ceives CIA information and acts as its M.P.'s. propaganda conduit. In fact, Robert Moss, The Foreign Affairs Publishing Co. is a a senior member of ISC up to mid-1980, is major publisher of rightwing books in Eng­ a regular recipient of CIA information. land and features titles such as "Inside The Daily Telegraph wrote on August 6, the KGB," "The Communist Challenge to Af­ 1979 that one CIA report on Nicaragua, rica," and "The Assault en the West," etc. classified "Secret:. �o Foreign Dissemina- Since the company is a private limited- 56 -- Counte1•Spy -- Nov. 81 - Jan. 82

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 company, its accounts are not available to very popular with the South African gov­ the public. It is known, though, that the ernment. FARI's deputy director Ian company is an agent for the Swiss Eastern Greig's book, The Communist Challenge to Institute based in Berne which analyze• Africa, was published as a joint venture the development of Eastern Europe from an by FAR! and the South African Freedom "objective, 11 r lghtwing perspective. For­ Foundation (SAFF), a.propaganda organiza­ eign Affairs Publishing Co. is also an tion founded by the South African Depart­ agent for the International Documentation ment of Information. SAFF also paid for and Information Center (Interdoc) in Hol­ visits to South Africa by Robert Moss and land. Interdoc has published a Who's Who General Sir Walter Walker, former NATO and What's What on progressive activists Comntander-in-Chief for Northern Europe.ll in Europe. It is run by the East-West In­ stitute, an organization which according THE NATIONAL ASSOCIATION FOR FREEDOM to Time Out magazine has had close con­ tacts with the rightwing British Monday NAFF, recently re-named Freedom Associa­ Club (see below) and Dutch intelligence.9 tion, came into being in 1974 following Strategically located at Whitehall, near the election victory of the Labour Party. the Foreign Office and other centers of Lord De L'Isle (Chairperson of Phoenix As­ government, the Foreign Affairs Research surance, one of the largest insurance com­ Institute (FAR!) is a mini-version of, and panies in Britain) became, and still is, resembles, ISC. In 1979 Conservative M.P. its head, and former Tory M.P. John Sir Frederick Bennett was the chairperson Govriet became administrative director. of FARI; and Robert Moss and Brian Crozier The director was Robert Moss; he resigned have also been on the FAR! council. Ac­ recently and the position is now vacant. cording to Eschel Rhoodie, the former head Other ISC luminaries joined the NAFF coun­ of the infamous South African Department cil, including Brian Crozier. NAFF's aims of Information, FARI was set up by South are laid out in a 15 point "Charter of Africans in 1976,lO and since 1976 has Freedom" which puts great stress on the been subsidized on an annual basis of "sanctity of private property, ... the t85,000. The South Africans aimed to in­ freedom not to join a trade union and fluence government opinion in the West on freedom from oppressive taxation." ln a the strategic importance of the sea lanes number of industrial disputes, NAFF has around South Africa and its raw material& played a major strike-breaking role. For - both of which FARI claims are threatened example, when two anti-union employees at by the Soviet Union. A conference on West­ British Rail were dismissed for refusing ern commitment to South Africa, sponsored to join the union, NAFF took their case to and organized by FARI, ISC and NSIC, was the European Court of Human Rights, which held in Brighton, England in June 1978. they won in August 1981 . Attendants included Brian Crozier, Stewart -Smith, Air Vice Marshall Stuart Menaul THE MONDAY CLUB (ret.), Lord Allen Chalfont, George K. Tanham, and the former head of the South The Monday Club was formed in reaction African Defense Force, Admiral James to t.he "pink" policies of then-Prime Min­ Johnson. ister Harold McMillan in January 1961, by Naturally, FARI's activities have been Ian Greig (who would later become FARI's deputy director), Cedric Gunnery, Anthony Mcclaren, and Paul Bristol. Its main goal A June 25, 1981 letter ("Dear Bill") is to influence the Conservative Party and from Stewart-Smith to Willicon E. Green move it to tlie right. Bristol was the of A ltawaiZ Trading Enterprises, Lendon Club's first chairperson, and in the be­ which was obtained by Counterspy indi­ ginning, meetings were held on Xondays in cates FARI collaboration with the Em­ his home with a dozen or so people attend­ bassy of Saudi Arabia in Land.on ar,il the ing. After one year, the Club had fifty nature of FARI' s funding today. Stewart members divided into five research groups. -Smith mentions a !U,000 donation frcrr. Members of Parliament and other prominent Lockheed and asks Green to arrange con­ rightwingers also joined the Club when it tributions from Altawail and General was still in its infancy, including Ronald Dynconics. Bell, Patrick Wall, and Harold Soref, a -- Counterspy -- Nov.Bl - Jc:n.82 57

Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 former M.P. and intelligence officer. At in London to give a talk. the end of 1963, the Club had about 250 Senior members of the Conservative Party members, eleven of them M.P.'s. regularly attend Monday Club meetings, and During �he Club's first few years, it the list of military Club speakers reads concerned itself with "the surrender of like a military Who's Who. It includes British responsibility in Africa/' espe­ Sir Neil Cameron, Marshall of the Royal cially in Rhodesia; In.November 1963, Air Force; S.W.B. Menaul, director of the Sore£ organized a reception for Ian Smith, Royal United Institute for Defence Stud­ then Rhodesia's Prime Minister. In No­ ies; and Sir Peter Hill-Norton, Admiral of vemb�r 196� the Club held a meeting on the Fleet. One favorite war horse of the Rhodesia at which it calle4 for friendship Club is Sir Walter Walker, who was· busy and cooperation with the racist govern­ forming his private "army" called Unison ment. The event ended in three cheer.s for in the mid-1970's. It was subsequently re­ Ian Smith. The Monday Club,unanimously constituted under the name "Civil Assis- protested sanctions against Rhodesia; a tance." "Scrap Sanctions - Talk Now" meeting was held in Westminster in February 1966. The SOME SUCCESS publicity resulting from this event brought the first substantial increase in The propaganda of FARI, the Monday Club, membership. In April 1969, membership ex­ NAFF, t�e ISC and similar organizations ceeded 1,500 - an increase of 90 percent has been important in preserving the domi­ in one year, and by its tenth anniversary na�ion of U.S. military and strategic in­ (1971) the Club had the largest membership terests over Britain since World War II. of any conservative organization in Eng­ In the political sphere, such bodies cer­ land, with branches in Scotland, Wales and tainly helped bring rightwing British pol­ Northern Ireland. iticians a la Margaret Thatcher to power. The 1970 election of Conservative Edward Naturally, the U.S. government does not Heath as Prime Minister was a breakthrough want a leftwing government in Britain for the Monday Club, and it was able to which might opt to withdraw from NATO, ex­ dramatically increase its representation pell the approximately 25,000 U.S. troops in Parliament. Twenty-nine members, in­ in Britain, nationalize U.S. firms, and cluding Stewart-Smith, were elected to the end the close collaboration of U.S. and House of Commons, increasing the number to British intelligence agencies. In 1974, thirty-five. Although Heath was considered the Ford administration was alarmed about too moderate, the Club was able to in­ the election victory of a left-leaning fluence him on such matters as arms sales Labour government. Such a move had to be to South Africa which he dealt with "'to stopped. Within two years the U.S.-con­ the satisfaction of.the Monday Club .••• " trolled International Monetary Fund, by In 1970, the Club held a "Conference on imposing drastic economic conditions on a Subversion" attended by 250 members. loan made to Britain, forced the Labour Speakers included General de Lorenzo, for­ government to apply unpopular conservative mer head of Italian Security and a fas­ policies. At the same time, rightwing pro­ cist; Charles Lyons of the FBI; and Sir paganda organizations stepped up their ef­ Robert Thompson. The panel for discussion forts to insure that the Labour government included Ian Greig, Harold Sore£, and would be replaced by a government of their George K. Young, former head of counteres­ liking. To this end, Robert Moss, an Aus­ pionage, 21st Army Group. tralian citizen, returned to Britain and Continuing its support for the regimes became the speech writer for a little­ of South Africa and Rhodesia, the Monday kno�� M.P., Margaret Thatcher. One of Club organized numerous meetings on South­ Moss's speeches, attacking the alleged So­ ern Africa such as one on October 4, 1977 vietization of Britain, earned Thatcher featuring Cas de Villiers, director of the the nickname "the Iron Maiden," and gave Foreign Affairs Association of South Afri­ her much media exposure. Moss took over ca (FAA), and one on July 12, f979 with important positions in the ISC, and helped John Launder, an editor of the Rhodesian to organize NAFF. Thus, he was able to Broadcasting Company as a speaker. Only figure prominently in a propaganda cam­ last year, the Club's Africa Group invited paign to manipulate the British media in Johan Adler of the South African embassy support of the return of a rightwing gov-· 58 -- Counte�Spy -- Nov.Bl - Jan.82 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7 Approved For Release 2010/06/15: CIA-RDP90-00845R000100140005-7

ernment. described above WE're major contributors to Propaganda was used to agitate around this distortion. Their dissemination of two actual crises: a series of serious disinformation about leftist subversion strikes, and escalating repression and re­ was and is aimed to convince Purl :Lament sistance in Northern Ireland. Moss a,:d his and the public of the need for strong i�­ cohorts, through their propaganda, skill­ telligence agencies; and ",-;trong" intE.lli­ fully turned strikes from being ordinary gence agencies, they argue, are incompati­ conflicts he:tween workers and owners intc ble with public scrutiny. TLis campaign, ''communist encroachment" and tr,e "march of coupled wit� Eritain's Official Secrets the left," charges which ,;,:ere duly "af­ Act and rigid libel laws has allowed Brit­ firmed" and detailed in the British media. ish intelligence to maintain a fairly low In tu rn, the British population, especial­ profile: as far as their illeg;il activitiE!:' ly during the winter of 1978 to 1979, was are concerned. psyched into a national crisis mentality, British history over the last decadE and rt.any werE- given to beli('Vf.' that only a provides numerous examples cf l1ow a "strong and fin::" Conservat ivc government country c&c be manipulated intc cold war, could "sort out" the "industrial wreckers" anti-workei: politics. H2-in actors in Brit­ and assorted ''communist thugs.'' ain ir:cluded these non-elected organiza­ As it turned out, the Soviets did net tions buttressed by the British intelli­ take over Britain, but tte rightwing shad­ gence services, and used by foreign intEl­ ow goverr.r:-1ent, assembled in part by �foss, ligence agencies and governments as pr0pa­ did. However, some sectors of the extreme ganda transrr.jssion telts. }'hus, rightwing right in Britain migr� have been prepared "research" institutionE have been ahlc to to counter a Labour victory with illegal affect the political scene in many ways of methods. Just before the 1979 election, which the public has not always been cog­ the late Airey Neave, M.P., Monday Club nizant. supporter and one of Thatcher's closest allies, discussed plans for an undE.rcover FOOTNOTES "army cf resistance" in the event of a La­ bour victory, according to lee Tracey, a 1) Daily �!ail, 12/2;'/76. 2) State Research _!!_a_c_k_&!_l'_L!'.i :.��ipe�_, 10/77, p.2. former British intelligence officer and 3) Guardian, 12/20/76, p.o. electronics expert. Other options brought 4) ibid. 5) The Leveller� no.�)2, 1as1, t•,J·:). up by Neave were possibilities to stop La­ 6) One member of the �ellun family, Richard Sc..1ifL �ellon, bour leader Tony Benn from becoming Prime purchased rorum WorlL� Feature's (ror.: To�n Hay :,:Litney, .1 �:inister by violent means. Tracey was witting CIA collaborator. 7) see also Searchl_i_g_lo_t, '.lo.Zr, 1977, pp,3-6, :he tent.,­ asked to consider whether he would join a cles of the Institute strP.tc-f. i:o lessE'r knc",,m orf,aniza­ team containing intelligence specialists tions. Based in Richn:.ond, for t.:....'

1 political editor of the Sunday Times, re­ 16) John Stockwell, -·Ir. --Search- --of �nemies,· -�- -- W. ,,..' . �orton ,1.nJ ported that during the 1970s, a colossal Co,, clew York. 17) see Reader's Digest_, 2/81, pr 106, 107. In its June distortion was permitted in the work of 1981 issue, Soldier _of L?J_!une features an article �y ,1ne British ±ntelligence. An inordinate of its staff writers, Al Venter, d ··uut his ac tua.l ;'drt::._c i­ stress on the "communist threat" led to pation in a South African raid intc Angola. 18) Philip Agee, �ide_ the Compa_:c.:::_ ,�IA�- Penguin massive propagandizing about "communist Books, Harmondsworth, England, 1c,,, p.611. subversion" in universities, trade unions and other institutions, i.e. the Labour Party.13 FARI, ISC and other organizations Counterspy -- Nov. "1 - Jan. 8� -- 5.9

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