----·---- 1 NumberЗS $ 5.00 / "" Friendly Enemies: The CIA In Eastern Europe \. " • Operatives and S&Ls: CIA and banks • "Crisis" in the Persian Gulf • lndonesia 1965 [ ч Editorial The Cold War, we are told, is over. The winds of change PhilipAgee have swept over the Soviet Union and Eastern Europe. The U.S. continues to make life difficult for Philip Agee, Through covert and overt encouragement, the West, especial­ former CIA operations officer and, since 1975, potent critic ly the United States, has been an active obser'Ver qf these of the Agency. In 1979 the U.S. revoked his passport for ex­ events. In parts of the Soviet Union and in many Eastern posing CIA officers and puЬlishing material without European nations consideraЫe power is now wi~lded Ьу clearance. Agee's challenge to the constitutionality of the friends of the United States. State Department regulations under which his passport was In particular, the convergence of U.S. and West German revoked was denied Ьу the Supreme Cщ1rt in 1981. interests and the headlong rush to unification cal1s fdr some Agee, who has remained а U.S. ciµzen, was given first а sober reflection. With the assistance of а CIA President in Grenadian, then а Nicaraguan honorary passport. This Sep­ Washington and а CIA Ambassador in Bonn, the new Ger­ tember, the Violeta Chamorro government-at the urging of many has emerged as the leading force in Europe. the U .S. -revoked the latter passport. As U.S.-instigated propaganda insinuates that the cor­ In 1987, Agee applied for а new U.S. passport showing that, nucopia of foreign aid will soon flow to America's new allies for years now, he had not divulged the identity of CIA person­ in the East, the economy at home continues to plummet nel, and that he had submitted for clearance everything he had deeper into а depression. published. Yet the intelligence community pursues, unrestrained, ex­ The State Department denied the application, refusing, pensive investments-high-technology through satellite sur­ contrary to its regulations, to present any of the alleged wit­ veillance, an expansion of human and military intelligence nesses against Agee. Despite а ruling Ьу its own internal ap­ capaЬilities - all in response to the changing global require­ peal board, State continues in its refusal. This has forced Agee ments. As cuts occur elsewhere, the CIA budget persists at an to file а suit in Federal Court, which is pending. This action is estimated $10-12 Ьillion. the latest in nearly twentyyears of efforts to prevent Agee from The shift is towards economic espionage, and the KGB and speaking, above all to people in the United States. For more CIA have entered into а limited partnership. The "curtain" information оп how to help: Speak Out!, 2215-R Market St., may have been lifted but the actors have not left the stage. #520, San Francisco, СА 94114, (415) 864-4561. • ТаЫе of Contents Editorial 2 PuЫications oflnterest 42 Analysis: Тhе Changes in Eastern Europe Тhе CIA and Banks Ьу Philip Agee, Ken Lawrence, Melvin Beck 3 Ьу Rebecca Sims 43 Reinhard Gehlen: Тhе Secret Тreaty of Fort Hunt Тhе Middle East in "Crisis" Ьу Carl Oglesby 8 Ьу Jane Hunter 49 NED Meddles in Lithuania Тhе Other Iran-contra Cases Ьу Philip Bonosky 17 Ьу David MacMichael 52 Тhе Destabllization ofthe Soviet Union Тhе Indonesian Massacres and the CIA Ьу Sean Gervasi 21 Ьу Ralph McGehee 56 Balkan Nationalists Peddling Fascism Тhе Indonesia Тranscripts Ьу Howard Goldenthal and Russ Bellant 27 Ьу Кathy Кadane 59 Тhе Free Congress Foundation Goes East Book Review: Тhе "Terrorism" Industry Ьу Russ Bellant and Louis Wolf 29 Ьу Jane Hunter 60 C.D. Jackson: Cold War Propagandist Book Review: Tortillas, Beans and M-16s Ьу Blanche Wiesen Cook 33 Ьу William Vornberger 61 . Cuba: Braving the Storm Ьу Debra Evenson 39 Cover Photo: Ronald Reagan and Mikhail Gorbachev in Moscow, September 17, 1990. Credit: Wide World Photos. Back Cover Photo: Members of the Ukrainian Nationalist Organization. Credit: Associated Press. CovertAction lnformation Bulletin, Number 35, Fall 1990, copyright © 1990 Ьу Covert Action PuЫications, lnc., а District of Columbla Nonprofit Cor­ poration; Р.О. Вох 34583, Washington, D.C. 20043; (202) 331-9763; and с/о Institute for Media Analysis, lnc., 145 W. 4th St., New York, NY 10012; (212) 982- 2897. All rights reserved. Staff: Ellen Ray, Richard Ray, William Schaap, and Louis Wolf. Photographyconsultant: Dolores Neuman. '!ypeset Ьу СА/В. lndexed in the Alternative Press lndex, ISSN 0275-ЗО9Х. 2 CovertAction Number 35 (Fall 1990) The Changes in Eastern Europe CAIB has approached Philip Agee, Melvin Beck, Кеп the West German intemal security service on espionage Lawrence, and а well-known joumalist, asking them to analyze directed against the Federal Republic. Тhе report alleged that the differences they foresee in the intelligence apparatus о/ the with the exception of East Germany, whose security service CIA and KGB in light о/ the changes in Eastem Europe. collapsed with the communist govemment, the countries of Eastem Europe continued intelligence operations in Westem Europe throughout 1989 and into 1990. Nevertheless, the Czech Deputy Foreign Мinister said at the same time that as of June 30, 1990, all officers of the Czech intelligence service had been transfeпed hQme. For the CIA, 1989 was quite likely а boom year for counter­ The CIA's Prospects intelligence operations against these services. One can presume an unusual numЬer of defectors took an opportunis­ in Eastern Europe tic jump while they thought they still had marketaЫe informa­ tion. And the CIA no doubt increased its positive recruitment Ьу Philip Agee attempts to take advantage of the political turmoil that must have affected the officers of а11 the East European services. Philip Agee was а case officer for tWelve years Ьefore leaving As for covert action on the political scene, the CIA and cer­ the CIA. At present he is Ьattling the U.S. courts to regain his tain other NATO services would Ье remiss if they failed to American passport. Не is working оп а new Ьооk, Тhе АВС's channelmoneyand othet items of value to anticommunist par­ of the CIA, to Ье puЫished in 1991 Ьу Lyle Stuart. ties and institutions, especially in education and the media. Тhey've been doing it since the 1940s, so why stop at the mo­ Early this year 1 participated in а Spanish television talk ment of greatest opportunity. show on "The Winds of Change in Eastem Europe." Others Follow the money flowing from the National Endowment on the program included Mircea Dinescu, а Romanian poet for Democracy (NED) through the RepuЬlican and and hero of the Ceausescu overthrow; Adam Michnik, а Democratic Parties, the U.S. ChamЬer of Commerce, and the founder of Polish Solidarity and KOR, now editor of а lead­ AFL-CIO, to end recipients in Eastem Europe. Look for the ing Warsaw newspaper; Jiri Pelikan, director of Czecho­ secret CIA hand exercising operational control Ьehind the slovakian radio and television during the Prague Spring of scenes. As in other regions, the CIA can initiate NED financ­ 1968; and Marina Silvinskaya, professor at а Soviet institute ing of а favored institution simply Ьу having them make ap­ of political studies. plication to one of the established conduits. Тhen through its Eastem Europe is not an area of expertise for me, but 1 ac­ liaison with NED the Agency can assure grant approval. cepted the invitation because 1 thought the events of 1989 Religious institutions like the Catholic Church also provide opened many windows of opportunity for the CIA and other excellent cover for getting money into countries for political NATO intelligence services. When 1 mentioned this on the purposes, and Eastern Europe has Ьееn no exception. program, the Romaiiian, and then the Pole, went on at some While each country of Eastem Europe provides а distinct length about how they saw not the slightest threat from the political scene, the CIA's political parties of choice would Ье United States, including the CIA. None of the others the traditional Christian Democratic and Social Democratic professed concem either. lt seemed the East Europeans, with forces, where they exist. But they cannot ignore their old al­ the exception of the Soviet professor, viewed potential threats lies on the far right, the so-called "nationalist" movements in а different historical context, as coming more likely from wblch, in theirvirulent anticommunism, allied themselves with Germany or the Soviet Union. Nazi occupation forces during World War 11 and participated Earlier in the day, during а luncheon hosted Ьу the in the slaughter of Jews. These fascists, after all, performed all program, 1 asked МiChnik what had become of the Polish in­ kinds of tasks for the Agency after the war, and already, in telligence service, adding that 1 had known one of their of­ some countries, they have revived racist feelings against Jews ficers in Mexico City when 1 was in the CIA. Не responded and Gypsies. with а wide grin and words to the effect that the .service is alive Of course, the goal of U.S. policy in Eastern Europe is, as andwell. always, anticommunism. ln Bulgaria and Romania, where ex­ Six months later, in July, Craig Whitney of the New York co:m.пщnists (Ьut still socialists) h.ave retained power through Тimes, wrote from Bonn on the just-released annual report of elections, the task will Ье quite different from the other Number 35 (Fall 1990) CovertAction 3 countries where communist parties have dramaticaliy timidating legislators, and infiltrating most political organiza­ declined in strength. Propaganda to discredit the communist tions.