Though the two sergeants were guilty of espionage, the army decided that, because they had been immunized, it would be too difficult to prosecute them and dropped the case. But senior officials at NSA demanded that the Ford administration not let these men go unpunished, and in late 1976, NSA director Allen sent a memo to CIA director George H. W. Bush recommending that both sergeants be prosecuted for espionage. Bush declined Allen’s request, arguing that he had no authority to overturn the army’s decision, but the real reason for not doing so was that it would have exposed the ongoing intelligence operations in Panama, and even possibly derailed negotiations over the draft Panama Canal Treaty.55
In January 1977, Gerald Ford left office and was replaced by President Jimmy Carter. The Carter administration felt that it had to inform the House and Senate intelligence committees about the compromise of the NSA operation, but asked the committees not to do anything about it because the matter “was still under investigation.”56In the end, the two sergeants were given honorable discharges, the case was closed, and on September 7, 1977, the Panama Canal Treaty was signed.
Bobby Ray Inman
On July 5, 1977, Lieutenant General Allen stepped down as director of NSA, was given another star, and was appointed commander of the U.S. Air Force Systems Command. A year later, he became the air force chief of staff, serving until his retirement in June 1982.
His replacement as NSA director was forty-six-year-old Vice Admiral Bobby Ray Inman, the youngest man ever to hold the position. The son of a gas station owner in tiny Rhonesboro, Texas, Inman was a childhood prodigy, graduating from the University of Texas with honors at nineteen. After graduation, he taught school for a year, then joined the navy in 1951, never intending to do more than a single three-year tour of duty. But Inman chose to remain in the navy, and over a thirty-year career he rose rapidly through the ranks, holding a series of increasingly important positions in naval intelligence. He was a protégé of Admiral James Holloway III, who first got Inman the job of chief of intelligence at Pacific Fleet. When Holloway became chief of naval operations in July 1974, he got Inman promoted to rear admiral and the position of director of ONI, which Inman held from September 1974 to July 1976, before becoming vice director of DIA, a position he held from 1976 to 1977. 57
Agency veterans were stunned by the torrid pace that the workaholic Inman set; he got up at four a.m. every day except Sunday to read the stack of intelligence reports that had come in overnight and was usually in his office at Fort Meade by six. He drove his senior managers and support staff nuts as they tried to keep up with their demanding boss. A typical workday was ten to twelve hours, six days a week and half a day on Sunday after church services. But Inman was perpetually late for appointments and required a bevy of executive assistants to help him keep track of all the meetings he needed to attend and the papers that required his signature. An NSA historian has written of him, “He appeared perpetually calm, but in reality was about as stable as high voltage across an air gap.”58
Charming and possessing a dry sense of humor, Inman was infamous within NSA for his awkwardness and clumsiness, earning himself the nickname the Blue Klutz. But those who worked for him, almost without exception, liked and respected him.59
Inman proved to be a relentless and vociferous advocate for his agency, which immediately put him at odds with the CIA. Antagonism between the two agencies’ top brass had been growing since the 1973 Arab-Israeli War debacle, leading one senior CIA official to recall the days when “NSA looked respectfully and appreciatively to CIA for guidance as to what it should collect and produce. It also depended frequently on the Agency for support in its annual quests for funds . . . As time passed and its bud get doubled, tripled, and quadrupled, NSA began to swell its corporate chest and develop a personality and style of its own. An organization which began with a serious inferiority complex gradually developed a feeling that it has ‘a corner on the market’ in terms of intelligence fit to print.”60
When the CIA’s new director, Admiral Stansfield Turner, tried to rein NSA in by cutting its $1.3 billion budget, Inman went around the CIA and began intensively lobbying on behalf of his agency at the White House. In the process, he made a number of important friends, particularly President Carter’s crusty national security advisor, Zbigniew Brzezinski, and Brzezinski’s deputy, Colonel William Odom, who would become the director of NSA in 1985. Inman also became a one-man public relations firm trumpeting NSA’s accomplishments, even giving on-the-record press interviews, something that previous NSA directors had never done.61
After a somewhat rocky start, Inman’s relationship with Brzezinski became increasingly close, even though “Zbig” sometimes wanted, according to Inman, “to push me to do things that I think the Agency should not be involved in.”62 Like Henry Kissinger, Brzezinski insisted that NSA send him, on an “eyes only” basis, any decrypts containing his name or the name of any other senior Carter administration official. Inman was only too happy to oblige. His brilliant performances before the Senate and House intelligence committees are legendary. During his tenure at NSA, Inman assiduously courted Congress, established an NSA Legislative Affairs Office, and, for the first time, sent reports detailing NSA’s highly sensitive SIGINT activities to the two congressional intelligence oversight committees.63
He needed all the friends on Capitol Hill he could get. Upon moving into the director’s office at Fort Meade, Inman discovered that NSA, with a staff of forty thousand soldiers and civilians, needed money— lots of money— to deal with a number of major problems that he inherited from Allen. Before taking over at NSA, Allen gave Inman a report on the Soviet cryptanalytic effort, which was on the verge of major success but in desperate need of more money and personnel, which were needed to achieve the anticipated breakthroughs. Another briefing paper given to him in 1977 noted that the new generation of SIGINT satellites in orbit over the Earth had “achieved outstanding performance in a number of areas.” But the report noted that more could be done and a rationale was needed for the next generation of huge SIGINT satellites due to be launched into space in the late 1970s. The most pressing problem he inherited was an old one— NSA’s analysts were drowning in a sea of intercepts that was growing incrementally every day. A report noted that NSA had “not developed capabilities to efficiently deal with the increased amount of raw data generated by new collection systems.”64
Inman got $150 million in 1977 to modernize NSA’s worldwide operations, with huge appropriations in the following years to expand NSA’s SIGINT coverage to previously ignored areas of the world, build new and improved SIGINT satellites, and develop and build a host of new high-tech systems to gain access to a new generation of Soviet communications systems. Inman’s advancement of NSA’s interests earned him the enmity of many within the U.S. intelligence community, particularly CIA director Turner.65
Inman’s numerous battles with Turner still reverberate in the halls of NSA and the CIA. Turner was determined to gain a greater degree of control over NSA. Years later, he would describe it as “the largest agency in the intelligence community; a top command of some general or admiral; and a proud, highly competent organization that does not like to keep its light under a bushel . . . a pretty remote member of the [intelligence] community. The physical remoteness [from Washington] is compounded by the fact that the NSA deals in such highly secret materials that it is often reluctant to share them with others lest a leak spoil their ability to get that kind of information again. It is a loner organization.”66
Inman struggled to get NSA out from under the control of the CIA’s National Intelligence Tasking Center, Turner’s creation designed to coordinate intelligence tasking and requirements within the U.S. intelligence community. The two men were soon no longer on speaking terms, forcing Frank Car-lucci, the deputy director of the CIA, into the uncomfortable position of acting as go-between. But most of all, Inman fought to dismantle Turner’s proposed APEX code word classification system, because NSA feared tha
t it would ultimately give the CIA control over the dissemination of NSA-produced intelligence. Inman and his deputies managed to stall implementation of the APEX system until the Reagan administration came into power in January 1981 and promptly killed the plan.67
Under Inman’s direction, by the late 1970s, NSA had become the top U.S. producer of hard, usable intelligence. During Inman’s watch, the agency broke into a series of high-level Soviet cryptographic systems, giving the U.S. intelligence community high-level access to Soviet military and political thinking for the first time in years.68
The Soviet Target
Going into the 1970s, NSA and its British partner, GCHQ, were deriving a moderate degree of high-level intelligence about the USSR from sources like the Gamma Guppy intercepts from Moscow, and another program that enabled NSA to read communications traffic between Moscow and the Soviet embassy in Cairo in the months leading up to the October 1973 Arab-Israeli War.69In the United States, Project Aquarian gave NSA the ability to tell which U.S. government telephone calls the Soviets were intercepting from inside their diplomatic establishments in Washington, New York, and San Francisco. One intercept caught the KGB listening in on Attorney General Griffin Bell discussing classified information on an unsecure telephone line.70
But according to some sources, the overall importance of SIGINT within the U.S. intelligence community continued to decline in the 1970s, particularly with regard to the USSR. This was due in part to a GCHQ official named Geoffrey Arthur Prime, a Russian linguist at Cheltenham from 1968 to 1977, who was arrested in 1982 and charged with spying for the Soviet Union. NSA officials confirmed that while Prime was working at GCHQ headquarters, NSA and GCHQ lost their ability to read a number of important Soviet systems when the Russians abruptly and without warning changed their codes or modified their communications procedures in order to make them impenetrable to the American and British cryptanalysts. In November 1982, Prime pleaded guilty and was sentenced to thirty-eight years in prison.71
A 1976 study of U.S. intelligence reporting on the Soviet Union, however, found that virtually all of the material contained in the CIA’s National Intelligence Estimates about Soviet strategic and conventional military forces came from SIGINT and satellite imagery. A similar study found that less than 5 percent of the finished intelligence being generated by the U.S. intelligence community came from HUMINT.72Moreover, rapid changes in intelligence-gathering and information-processing technology proved to be a godsend for NSA. In 1976, NSA retired its huge IBM Harvest computer system, which had been the mainstay of the agency’s cryptanalysts since February 1962. It was replaced by the first of computer genius Seymour Cray’s new Cray-1 supercomputers. Standing six feet six inches high, the Cray supercomputer was a remarkable piece of machinery, capable of performing 150–200 million calculations a second, giving it ten times the computing power of any other computer in the world. More important, the Cray allowed the agency’s crypt-analysts for the first time to tackle the previously invulnerable Soviet high-level cipher systems.73
Shortly after Bobby Inman became the director of NSA in 1977, cryptanalysts working for the agency’s Soviet code-breaking unit, A Group, headed by Ann Caracristi, succeeded in solving a number of Soviet cipher systems that gave NSA access to high-level Soviet communications. Credit for this accomplishment goes to a small and ultra-secretive unit called the Rainfall Program Management Division, headed from 1974 to 1978 by a native New Yorker named Lawrence Castro. Holding bachelor’s and master’s degrees in electrical engineering from the Massachusetts Institute of Technology, Castro got into the SIGINT business in 1965 when he joined ASA as a young second lieu-tenant. In 1967, he converted to civilian status and joined NSA as an engineer in the agency’s Research and Engineering Organization, where he worked on techniques for solving high-level Russian cipher systems.74
By 1976, thanks in part to some mistakes made by Russian cipher operators, NSA cryptanalysts were able to reconstruct some of the inner workings of the Soviet military’s cipher systems. In 1977, NSA suddenly was able to read at least some of the communications traffic passing between Moscow and the Russian embassy in Washington, including one message from Russian ambassador Anatoly Dobrynin to the Soviet Foreign Ministry repeating the advice given him by Henry Kissinger on how to deal with the new Carter administration in the still-ongoing SALT II negotiations.75
The Iranian Revolution
NSA was successful in deciphering the most sensitive communications traffic and high-level thinking of the Irani an government prior to the fall of the shah in February 1979, but there is little indication that the intelligence analysts at the CIA took much note of this material. Instead, Langley seems to have relied on the daily reporting of the U.S. military attachés in Tehran, who generally presented a more optimistic view of the viability of the shah’s regime than most other experts.76
When the February 1979 revolution brought the Islamic fundamentalist cleric Ayatollah Khomeini to power, the CIA’s Tacksman intercept bases in Iran, which monitored Russian missile telemetry signals, were shut down. However, NSA continued to exploit high-level Iranian diplomatic and military communications traffic, the best intercepts coming from the Rhyolite SIGINT satellites parked over North Africa, which were retargeted to intercept Irani an military tactical radio traffic.77
The 1979 Sino-Vietnamese War
After Vietnamese forces invaded Cambodia in late December 1977, Beijing ratcheted up a war of words directed at Vietnam, forcing it to withdraw its troops in January 1978. The first signs that China had begun preparing for a potential war with Vietnam came in October 1978, when SIGINT detected Chinese army units leaving their garrisons in and around the southern Chinese city of Kun-ming and taking up positions along China’s border with Vietnam. The buildup of troops and aircraft continued until, by January 1, 1979, the Chinese troops deployed along the Vietnamese border outnumbered the Vietnamese troops four to one. War was imminent. It was just a question of when it would break out.78
On the morning of January 4, over one hundred thousand Vietnamese troops invaded Cambodia, and in a matter of a few weeks they destroyed the military forces of the brutal Khmer Rouge regime and forced its despotic ruler, Pol Pot, and his minions to flee to neighboring Thailand. The next day, NSA and the Australian SIGINT agency, the Defence Signals Directorate (DSD), declared a SIGINT alert, anticipating that the invasion would almost certainly provoke a forceful Chinese response.79
NSA and DSD watched and listened as the Chinese ultimately positioned 320,000 ground troops and 350 combat aircraft in the area adjacent to the Vietnamese border by early February, as well as activating special communications circuits connecting Beijing with a special Chinese general staff command post at Duyun, in southern China, one that had previously been activated only in time’s of hostilities. On January 19, the CIA had reported, “The manner of the buildup, its timing and the mix of forces involved suggest offensive rather than defensive preparations.” CIA and Australian intelligence analysts in Washington and Canberra also believed that outright war between the two countries was unlikely. So it came as a shock to many policy makers in Washington when seven Chinese armies surged across the border into Vietnam at dawn on the morning of February 17.80
NSA’s performance during the run-up to the Chinese offensive appears to have been a mixed bag, largely because its overall collection efforts were hampered by communications security measures taken by both the Chinese and the Vietnamese militaries, such as extensive use of landlines instead of radio.81
The Fall of Somoza and the Russian Brigade in Cuba
On July 17, 1979, the longtime Nicaraguan dictator Anastasio “Tacho” So-moza fled Nicaragua for Miami, but was denied entry to the United States by President Carter. Two days later, the Sandinista guerrillas who had battled So-moza for a decade entered the Nicaraguan capital of Managua and declared themselves the new rulers of the country.
The Carter administration ordered intensified intelligence coverage of the new re
gime because it was supported by the Soviet Union and Cuba. In particular, the White House wanted to know if the Sandinistas were providing material or financial support to the Marxist guerrillas operating in neighboring El Salvador, who called themselves the Faribundo Martí National Liberation Front (FMLN). As part of the “surge” effort, Norman Klar’s G6 stepped up SIGINT reporting on Nicaragua. U.S. Navy SIGINT reconnaissance aircraft were deployed to Guantánamo Bay, Cuba, to monitor developments in Nicaragua, and NSA’s listening posts in the region were tasked with greater coverage of Sandinista communications.82
By 1980, Klar’s cryptanalysts had solved and were reading some high-level Nicaraguan diplomatic communications traffic, but much less SIGINT was being obtained from the Salvadoran FMLN guerrillas, who communicated by radio far less often than their Nicaraguan counterparts.83
Administration officials, particularly Zbigniew Brzezinski, were convinced that the Sandinista victory in Nicaragua and the growing power of FMLN in El Salvador were being directed by Fidel Castro in Havana, almost certainly with backing from the Soviet Union, so NSA and the rest of the U.S. intelligence community were ordered to intensify their reporting on Cuban military and clandestine activity in Central America as well as Soviet activities in Cuba itself. Accordingly, in July and August 1979, NSA dramatically stepped up its SIGINT coverage of Cuba.84
The U.S. intelligence community knew the Russians had maintained a sizable military training mission in Cuba since 1962, and the CIA reported to President Carter in May 1979 that there were two thousand Soviet military personnel serving as advisers to the Cuban military and conducting SIGINT collection at a large listening post in Lourdes, outside Havana. The report stated that, according to some fragmentary SIGINT, Soviet pilots were flying Cuban MiG fighters, but it made no mention of Soviet combat troops being in Cuba.85
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