Secret

by Brian Toohey

  In the weeks leading up to 11 November, Whitlam increasingly angered senior members of the US government by speaking out about Pine Gap and the CIA. They realised he only had to stay in power until 10 December 1975 to give notice to end the Pine Gap agreement. Whitlam had given conflicting accounts of whether he would do so. Green told me that the US never knew where Whitlam really stood on this issue.15 After Idle reported in NID on 8 November that Whitlam’s prospects had greatly improved, the head of the CIA’s East Asia division, Ted Shackley, promptly asked the ASIO liaison officer in Washington to pass on a strongly worded message to his director-general about how ‘the CIA feels grave concern’ about Whitlam’s behaviour.16 Shackley seemed to assume that Whitlam was to blame for leaks about Pine Gap, but Whitlam certainly had not leaked Stallings’ name and occupation to me, while other journalists told me they relied on US sources. Shackley’s telex said he wanted an answer from ASIO about whether Whitlam had changed his attitude to the bases, adding that CIA officials ‘feel that if this problem cannot be solved, they do not see how mutually beneficial relationships are going to continue … The CIA does not lightly adopt this attitude.’ The telex greatly angered Whitlam, but his dismissal meant he could not give notice on 10 December 1975 to close Pine Gap as US officials had feared.

  Given that it was already publicly known that Pine Gap was run by the CIA and linked to signals intelligence satellites, Victor Marchetti, a former senior CIA officer, later said Shackley was probably concerned about something else the CIA was doing in Australia ‘that was really sensitive and had to be kept from the Australian people’.17 A former US military officer with a detailed knowledge of the CIA, William Corson, told me in Washington in 1980 that Shackley had a continuing interest in the drug trade following his time as CIA station chief in Laos and Vietnam, and this was what concerned him about future revelations in Australia.18 He said that CIA-sanctioned heroin trafficking out of Indochina involved bringing drugs into Australia via big US transport planes that landed at Richmond air force base outside Newcastle en route to Alice Springs, where they picked up large quantities of signals intelligence from Pine Gap. Corson said this made the planes immune to Customs inspection. Shackley was sacked in 1979 for having an unsanctioned relationship with Ed Wilson, who was convicted in 1983 of selling arms to the dictatorial Libyan regime.

  Whitlam predominantly blamed Kerr for his demise, but gave a speech in parliament on 4 May 1977 in which he said a disturbing aspect to Shackley’s telex was that he described his message as ‘an official demarche on service to service link’—in other words, the elected government was not to be informed. Whitlam said, ‘Implicit in the CIA’s approach to ASIO for information on events in Australia was an understanding that the Australian organisation had obligations of loyalty to the CIA itself before its obligations to the Australian government. The tone and content of the CIA message [were] offensive; its implications were sinister. Here was a foreign intelligence service telling Australia’s domestic security service to keep information from the Australian government.’ In a follow-up parliamentary speech on 24 May 1977, he said the ‘interests of the CIA are not necessarily those of Australia … Australia must be satisfied that American agents are not acting in a manner contrary to our interests as a nation. Are we to let an ally get away with something a rival would not be allowed to get away with?’

  Shackley later told me in Washington that he wasn’t worried about an adverse reaction from Whitlam—such as shutting Pine Gap—because he never expected ASIO to show the telex to him.19 Although he denied giving Kerr a copy, he said he expected it would be shared with other members of the intelligence community because this was how things were done. This was true, but ASIO had changed under Barbour’s leadership and its acting head, Frank Mahoney, accepted it could not withhold the contents of such a message from the government in a democratic society. Nevertheless, Blaxland maintained that there was no indication in ASIO files for the claim that Shackley’s telex suggested that ASIO had obligations of loyalty to the CIA before its obligations to the Australian government. He said the cable was ‘not underhanded’.20 As Whitlam explained in parliament, that is precisely what it was and precisely what Shackley intended.

  Blaxland made a more fundamental error when he alleged, ‘Without seeking official confirmation [before 11 November] Whitlam declared that Stallings was a CIA operative … in charge of establishing the Pine Gap installation.’ In fact, Whitlam had been briefed. Tange had officially informed him of this in October 1975 after the prime minister demanded an answer. It was a belated admission by Tange, who had lied in his first briefing to Whitlam in December 1972 by telling him the Pentagon ran the base. Whitlam only confirmed what I had already made public on 3 November 1975. Apparently, Blaxland didn’t understand that only Defence gave briefings on Pine Gap. At that stage, ASIO had not been briefed.

  32

  SOME DISTINGUISHED GENTLEMEN FROM THE CIA

  ‘The CIA [was involved] in some 900 foreign interventions over the past two decades.’

  US journalist and historian Taylor Branch1

  Bill Morrison, Labor’s defence minister in 1975, threw new light on Whitlam’s dismissal when he told journalist Andrew Clark, ‘[Governor-General Sir John] Kerr sought and received a high-level briefing from senior defence officials on a CIA threat to withdraw intelligence cooperation from Australia … I don’t think it [the briefing] was decisive, but I think it reinforced his position [about sacking the government].’2 Clark later told me Morrison had been ‘completely lucid and his recollection sharp’ when he said this.

  I share Morrison’s view that the briefing would not have been decisive but would have reinforced Kerr’s decision to sack Whitlam on 11 November 1975. Morrison’s information complements a conversation I had with the chief Defence scientist, John Farrands, at a midmorning function in the Senate gardens in April 1977. Much to the annoyance of Defence head Arthur Tange, Farrands enjoyed talking to journalists, subject to the common proviso that he’d deny saying anything that got him into trouble. (I made a note of the 1977 conversation about ten minutes after it ended.)

  Farrands began by asking if I’d read anything good on science recently. When I told him about an article I’d just read in a US Army science journal—a rare occurrence—he laughed and said, ‘We’ll make a scientist of you yet.’3 When I asked why he had visited Kerr on 28 October 1975, he said, ‘That was just a cup of tea. You’d be much more interested in later on. Looking back, it’s hard to understand what all the fuss was about.’ He said that following the US complaints about Whitlam and Pine Gap, ‘Tange ran around, making calls, meeting military chiefs, ministers and others. He told me to ring Kerr and fill him in.’ Farrands did not mention, and may not have known, that according to Morrison, Kerr initiated the request for the briefing. Farrands said he called Kerr on 8 November and gave him a summary of the concerns about Whitlam.

  I reported in the AFR a brief account of what Farrands had told me, without identifying him, and stated, ‘There is no hard evidence that the briefing influenced Kerr’s decision.’4 Yet John Blaxland accused me of claiming that Whitlam’s dismissal was the ‘result’ of Farrands’ briefing of Kerr in 1975.5

  Farrands rang me shortly after publication of my article to say he’d had a ‘heated exchange’ with Tange and was under intense pressure to deny the report. He said Tange had told him it was ‘imperative that no one knows’ about the briefing—he was particularly worried that Whitlam would think Tange had ‘gone behind his back’. I told Farrands he knew what he’d said, and the call ended amiably. As expected, he subsequently denied the substance of what I reported, but not that we had spoken on each occasion.

  Kerr saw himself as commander-in-chief of the Australian military and never hesitated to ask for briefings from Australian or US officials. There were ample opportunities for him to hear about the US concerns regarding Labor before Farrands’ briefing. The US’s and Tange’s concerns were wildly overblown: Whitlam mere
ly said the CIA ran Pine Gap, which was already public knowledge. The Soviet spy Christopher Boyce had answered that question for the Kremlin.

  Kerr later denied that the Farrands briefing had occurred. It would have been surprising if he’d confirmed it—he’d copped savage criticism following the dismissal for violating one of the main constitutional conventions and for concealing his thinking from his prime minister. He did not assist his credibility by also denying that he’d had contact with US intelligence officials in the past. He had been president of LawAsia and deeply involved in the Australian Association for Cultural Freedom, each of which had received CIA subsidies, and had visited the US in 1967 to discuss further funding for LawAsia four months after it had been publicly identified as receiving CIA money.6

  Whitlam’s folly in appointing Kerr to the vice-regal post was another example of his appalling judgement of people. He seemed oblivious to the widely known fact that Kerr had been a strong critic of the Labor Party as far back the 1950s and had been involved with covert CIA-funded organisations in the 1960s that amounted to unacceptable foreign influence.

  Whitlam’s judgement about Tange was no better. Initially, he treated Tange as one of the traditional public servants he admired. But Tange saw himself as the ultimate ‘keeper of the secrets’.7 He deceived Whitlam in his initial briefing by saying that Pine Gap was run by the Pentagon rather than the CIA—something a prime minister had every right to know—and in November 1975, he attempted to bully and intimidate Whitlam.8 Tange later explained that he didn’t want to take defamation action against me over an article relating to November 1975 because he was concerned his case might ‘be compromised by evidence that the Defence Department had, from occasional misjudgement rather than any plot, failed to inform its minister of certain things’.9 Given that he’d deceived the prime minister, his caution was justified.

  Andrew Hay, an influential ministerial staff member who had a major role in the Coalition’s campaign to bring Whitlam down, told me in 2016 that he knew Tange wasn’t loyal to Whitlam. (He called Tange ‘Sir After Dark’ because that was when Tange ‘did his best work’.) Hay, a friend of mine, said Tange was ‘operating behind the scenes to see the end of the Whitlam Government and that he [Hay] was hoping to write about it, but didn’t have the energy to pull the files out’.10

  After key US National Security Council documents were declassified, James Curran revealed that senior US policy-makers considered ‘some kind of covert CIA activity in Australian domestic politics’ in 1974, but apparently abandoned the idea later that year.11 It’s unclear if planning was revived in 1975 when Whitlam was considered a much bigger problem. Although Curran said he found no evidence of involvement in Whitlam’s dismissal, he later explained that he meant no documented evidence was available, especially as many CIA documents are unavailable. The expatriate Australian journalist Phillip Knightley, who reported widely on intelligence issues for the London Times, said the whole point of a covert intelligence operation is to leave no trace, so there need be ‘no paper in the CIA archives setting out how the Whitlam Government could be destabilised’.12 Moreover, the United States could have used another clandestine agency such as Naval Intelligence Unit Task Force 157, which John Walker told me was doing something in Sydney and Melbourne while he was CIA station chief in Australia, but he didn’t know what it was.13

  Many American politicians and journalists had no trouble acknowledging in the 1970s that the US engaged in unacceptable forms of foreign interference. The CIA was established in large measure to engage in conspiracies on behalf of the US government, and has done so on numerous occasions. The New York Times Magazine reported on 13 September 1976 that congressional investigations had shown that the CIA, ‘in some 900 foreign interventions over the past two decades, has run secret wars around the globe and has clandestinely dominated foreign governments so thoroughly as to make them virtual client states … Distinguished gentlemen from the CIA hatched assassination plots with Mafia gangsters.’ The revelations largely stopped following Bill Colby’s sacking as CIA director on 2 November 1975 for being too willing to comply with congressional requests for sensitive information.14

  Informed discussion of the Whitlam era deserves a more mature approach than lazy attempts to brand discomforting information as part of a conspiracy theory.15 In this context, it’s worth noting that in August 1978, Richard Holbrooke, the assistant secretary of state who investigated claims that something untoward happened in Australia, said, ‘I cannot vouch for the fact that nothing improper was done by the CIA during the Whitlam Government. I can’t be sure.’16 It is also worth remembering that a former US consul general in Melbourne acknowledged that the CIA intervened in Australian politics in the 1960s.17

  In 1975 the CIA replaced John Walker as its station chief in Canberra with Milton Wonus, from its science and technology division. Wonus, who had a specialised knowledge of Pine Gap, reported to Ted Shackley in Washington. Like other gentlemen from the CIA, he enjoyed partying with an eclectic mix of guests. Walker told me in New York in 1981 that Wonus (who was known by his middle name, Corley) often spent time in Kings Cross where he hung out at a bar and restaurant owned by US businessman Bernie Houghton. Houghton was a key figure in the Nugan Hand Bank, which was notorious for money laundering, drug and arms dealing, and offering to make donations to political parties.18 Shackley told me in Washington that he had used Houghton to shift money for the CIA when he was in Vietnam and Laos, and that one of the partners in the Nugan Hand Bank, Michael Hand, had worked for him in covert military operations in Laos before becoming a ‘banker’.19 Houghton also had Australian intelligence connections: police investigators found that when he arrived without a valid visa at Sydney Airport on 12 February 1972, an immigration official wrote on his file: ‘Vouched for by … Mr Leo Carter, ASIO’.20 Carter was ASIO’s New South Wales head. Houghton’s passport was stamped ‘A’, allowing him to stay in Australia for as long as he wanted. The Stewart Royal Commission on Nugan Hand stated that Hand was also given special treatment by immigration in ‘irregular’ circumstances.21

  Against this backdrop, former CIA officer Kevin Mulcahy phoned me in mid-1981 after I had returned from a Washington posting, saying he wanted me to come back to Washington so he could tell me about a detailed explanation ‘Corley’ (Wonus) had given him about what the agency had done in Australia in 1975. I explained that my workload meant I couldn’t return until later. Mulcahy had earlier told me that he’d become a friend of Wonus while working with him in the CIA’s science and technology division. Mulcahy died in October 1981, not long after the phone call, but I have no reason to doubt the official verdict that there were no suspicious circumstances. Without knowing what Wonus had told Mulcahy, I had no article to write.

  Seymour Hersh, who’d introduced me to Mulcahy in Washington, said Mulcahy was a prosecution witness who had helped obtain the indictment of Ed Wilson for offences related to the illegal sale of weapons and explosives to the Libyan dictator Muammar al-Gaddafi and providing terrorist training.22 Formerly a CIA employee, Wilson was a covert operative in Naval Intelligence Unit Task Force 157. In 1979, a new CIA head, Stansfield Turner, sacked Shackley for not reporting his unsanctioned relationship with Wilson. In the same year, Wilson also met with Houghton five times in Switzerland.23

  33

  EMBRACING IGNORANCE

  ‘There are a number of conversations that would make it unwise for his allegations about CIA activity in Australia to be rejected out of hand.’

  ASIO officer Mike Leslie1

  Australian officials did not want to know about Christopher Boyce’s claims that he had learnt in a highly sensitive job that the CIA had deceived the Australian government and interfered in Australian politics and unions. The FBI arrested Boyce in the US in January 1977 and charged him with selling secrets to the Soviets. Boyce said that he had found out about the deception and interference while working in the code room at TRW, the Californian firm that basically operated Pin
e Gap and its associated Rhyolite satellites for the CIA. Although allegations of foreign interference should concern a counterintelligence organisation, senior officials in ASIO, Foreign Affairs and Defence didn’t want to find out.

  ASIO’s Washington liaison officer, Mike Leslie, was the honourable exception. Much to the discomfort of his superiors, he proposed interviewing Boyce in jail without anyone from the CIA present. He insisted, ‘If it is desired to establish the truth or otherwise of Boyce’s allegations, the only course open is for us to ask him questions.’2 After he told ASIO headquarters, as quoted above, that it would be unwise to reject Boyce’s allegations out of hand, he followed up by saying, ‘So far, nothing has emerged which renders his allegations incredible.’3 In addition to Boyce’s claims of day-to-day CIA deception of the Australian government and its alleged interference in trade unions, Leslie wanted to know what Boyce had told the Soviets that might affect Australian security.