Congress established the CIA to serve as a central depository for the various specialized intelligence and espionage functions within the intelligence community. This leaves the CIA, per Congress's intent, better able to focus directly on the overall community's three functions: (1) collecting vital intelligence; (2) disseminating it within the executive branch; and (3) conducting and coordinating spying, covert actions, and counterintelligence as effectively as possible.

The CIA's modern-day role derives from that of its World War II predecessor, the Office of Strategic Services (OSS), which had two main wartime functions: (1) for the first time in the nation's history, centrally gathering and analyzing intelligence; and (2) conducting covert operations, such as active aid to resistance movements in Europe, as authorized by the president.

The CIA is the only agency within the intelligence community authorized (and even then, only on a case-by-case basis) to conduct spying and covert actions abroad (although the president could conceivably order other agencies to be involved). However, both the National Security Act of 1947 and Executive Order 12333—United States Intelligence Activities (1981) prohibit the CIA from spying on or acting against U.S. citizens domestically. Executive Order 12333 specifically forbids "physical surveillance of a United States person in the United States by agencies other than the FBI." Counterintelligence—monitoring and thwarting spying and intelligence activities against the United States, mostly within the United States—is thus a function assigned to the FBI domestically, with the CIA and the intelligence units of the armed services also assisting abroad.

This subject has prompted renewed interest and debate since the passage of H.R. 3162, commonly known as the Patriot Act, in October 2002. This legislative measure calls for, among other things, fewer restrictions on information sharing among intelligence agencies and law enforcement authorities on suspected terrorists, as well as greater authority for law enforcement to monitor the phone conversations and e-mail activities of such individuals.

Legislation passed in 1949 provided statutory authority for the CIA's undisclosed budget and staffing levels. The Central Intelligence Agency Act of 1949 exempted CIA funding from most of the usual appropriations procedures. Further, it allowed the agency not to divulge its "organization, functions, names, officials, titles, salaries, or numbers of personnel employed." The defense budget disguises funds intended for intelligence within the budgets of nonsecret defense agencies. Under the 1949 act, CIA funds listed in the budgets of other agencies could be moved back to the agency free of limitations placed on the original appropriations. In this way, intelligence community programs were shielded from outside evaluation, making it impossible for congressional overseers to get an idea of their cost-effectiveness and propriety.

As the cold war flourished from 1947 to 1977, the intelligence community was given unusual autonomy. Through 1977, thirty years after it was founded, the CIA was exempt from exposing and defending its budget. However, the gradual replacement of the cold war by détente (a period of new U.S.-Soviet understanding, especially about arms control, that developed in the early 1970s under President Nixon) and other developments led Congress to weaken the intelligence community's power in the mid-1970s. During the mid- to late 1970s, although the intelligence community's budget was not made public, congressional oversight committees were given more authority over the CIA's behavior, especially its espionage and covert actions.

Little official information about the CIA's size or appropriations is publicly available even now. For security reasons, the CIA keeps most of its activities and finances secret. The overall extent of the headquarters complex located in Langley, Virginia, suggests that the usual estimate of about twenty thousand employees at that location is accurate, but the number of agents, operatives, and others in various countries is unknown.

Estimates of current CIA budgets vary widely because CIA funds continue to be hidden in the annual budgets of other agencies. According to The CIA Factbook on Intelligence (Washington, DC: Office of Public Affairs, Central Intelligence Agency, 2004), the total intelligence budget for the U.S. government in 1998 (of which the CIA is one part) was $26.7 billion. More recent data had not been made public at the time of that publication.

A modern intelligence organization such as the CIA has a distinctive organizational chart, shown in Figure 8.3. There is a balance between functional and regional divisions as well as analytic and administrative divisions. Each of the CIA's three divisions, or "directorates," has its own deputy director. The Operations Directorate is responsible for covert actions and counterintelligence; the Science and Technology Directorate specializes in data interpretation; and the Intelligence Directorate generates reports based on analyses of raw data for the president and other members of the executive branch.

The DCI is distinct from other agency heads in that he or she serves as (1) head of the CIA; (2) head of the intelligence community; and (3) principal advisor on foreign intelligence to the NSC. Directors of other intelligence community agencies advise the DCI, in turn, by sitting on a number of specialized intelligence committees. Chief among these groups is the National Foreign Intelligence Board.

The DCI, in advising the NSC and the president, must be objective and resist political pressures that would influence his or her counsel. One way the CIA attempts to remain independent is by giving stable, lifelong careers to people who are not just competent technicians and accomplished specialists but who also pass a rigid background check, swear an oath of secrecy, and appear to possess such traits as loyalty, discretion, ingenuity, and a commitment to protecting and promoting American values. For this reason, the CIA places a high premium on trust and is often referred to by its employees as "the family." When the CIA's trust in its employees is misplaced, the consequences can be serious, as illustrated by the case of Aldrich Ames, a high-ranking CIA official who sold secrets to the Soviet Union (and later Russia) from 1985 to 1994. Not only did Ames's treachery as head of the CIA's Soviet counterintelligence unit result in flawed American policy, but it also cost several agents their lives.

THE FIRST THREE DECADES. During its first thirty years, the CIA became known as a producer and disseminator of the highest-quality intelligence. It developed economic forecasting methods that helped gauge the Soviet Union's strength; disproved the "missile gap," which assumed that American weaponry was insufficient to counter the Soviet threat; and provided useful information during the Vietnam War. However, the agency also fell short of expectations on some occasions. It failed to warn of the Suez Crisis in 1956 and the Yom Kippur War in 1973.

THE 1970s: INTELLIGENCE PROBLEMS AND CONGRESSIONAL CURBS. Congressional hearings during 1975 brought to light the CIA's role in several assassination plots against foreign leaders in Chile, the Congo, Cuba, the Dominican Republic, Haiti, and Indonesia. Charges were also made that CIA surveillance programs had been aimed at innocent foreign students, visitors to the United States, and Americans traveling abroad. Domestic practices of the CIA were attacked as illegal extensions of the CIA's foreign duties: domestic wiretaps, break-ins, and mail intercepts; infiltration of religious groups; surveillance of national political figures; training of local law enforcement in espionage techniques; and involvement in the academic world through subsidies and research contracts.

FIGURE 8.3

Concerned about possible domestic spying, President Gerald Ford appointed the Rockefeller Commission to report on CIA activities within U.S. borders. Before long, a number of congressional and executive actions had defined and limited the CIA's activities. In 1974 the first major restriction on the CIA's activities passed: the Hughes-Ryan Amendments. They required the CIA to submit plans for covert activities to the president, who in turn had to justify them to appropriate committees of Congress as being critical to national security.

The U.S. Senate also conducted an investigation into CIA activities. The Senate Select Committee to Study Governmental Operations with Respect to Intelligence Activities, popularly called the Church Committee for its chairman Senator Frank Church, issued fourteen reports during 1975 and 1976. They documented such abuses as the assassinations of foreign leaders and the clandestine monitoring of the domestic mail of American citizens.

The House and Senate Armed Services Committees, up until this time, had loosely supervised the CIA. Stricter supervision began when President Ford established the Intelligence Oversight Board (IOB) in 1976. The IOB is authorized to investigate the legality and appropriateness of intelligence activities and directs its reports to the attorney general. The Senate Select Committee on Intelligence (SSCI) was set up in 1976, and the following year the House Permanent Select Committee on Intelligence (HPSCI) came into being.

Although the number of employees and size of the CIA's recent budgets have not been publicly disclosed, they are scrutinized by several other government agencies. Along with the SSCI and the HPSCI, the OMB and the Defense Subcommittees of the Appropriations Committees in both houses of Congress must review these details. As with all other government organizations, an examination and approval process applies to the CIA's functions.

THE 1980s: IRAN-CONTRA. The infamous Iran-contra affair of the 1980s is one of the largest scandals to have plagued the intelligence community. The Reagan administration was determined to contain what it determined was a threat by the Sandinista government of Nicaragua to export communism to nearby countries. In April 1984, when word leaked out that CIA agents had helped place mines in three Nicaraguan harbors, several congressional representatives claimed that the CIA had not informed them properly, and some were convinced that they had been deceived. As a result, Congress passed a law in 1986, known some months later as the Boland Amendment to the War Powers Act of 1973, that prohibited any military aid to the Nicaraguan government's opponents, called the contras.

Still, Reagan's NSC was eager to continue such aid. The national security advisor and his staff, taking the view that the Boland Amendment did not apply to the NSC, continued aiding the contras by other means—for example, via private funds and contributions from other nations. The administration's efforts to skirt congressional appropriations (the only legitimate funds for national security) included efforts by members of the NSC to divert funds from sales of arms to Iran (although the sales of the arms were also done in an attempt to secure the release of American hostages).

Before long, Congress became extremely disenchanted with the CIA and the NSC. It investigated the Iran-contra connection, finding that CIA personnel in Central America had rendered logistical and tactical support and assistance even after passage of the Boland Amendment. Congressional committees investigating the affair also concluded that senior officials of the CIA had misled Congress, withheld information, or failed to contradict others who they knew were giving incorrect testimony.

THE 1990s: ADDITIONAL SCRUTINY OF THE CIA. Congress chartered the Commission on Roles and Capabilities of the U.S. Intelligence Community in 1994 to play an advisory role on the use of intelligence in national security. In the years that followed, it made a number of novel recommendations. One recommendation, for example, is that the government should disclose the current fiscal year's budget for the intelligence community and the total amount requested for the next fiscal year. As the commission noted in its final report, intelligence agencies "are institutions within a democracy, responsible to the president, the Congress, and ultimately, the people. Where accountability can be strengthened without damaging national security … it should be."

The 1996 report of a commission appointed by the Clinton administration to investigate the intelligence community also urged the CIA to pursue its mission with less secrecy and more accountability. The report suggested that the country take a middle-ground approach to the CIA's future by neither abolishing it nor giving it more powers.

Since the end of the cold war, the intelligence community has focused on such activities as fighting global terrorism, assisting law enforcement in fighting narcotics producers and traffickers, and collecting economic intelligence. Its strong mandate has been to cooperate more closely within the intelligence community and to reduce or eliminate duplications of effort. The CIA has established special multidisciplinary centers to address such major issues as nonproliferation, counterterrorism, counterintelligence, international organized crime and narcotics trafficking, environment, and arms control intelligence.

To address the threat of terrorism against American interests abroad, for example, the CIA created the Counter-Terrorism Center (CTC) in 1986, three years after the U.S. embassy and Marine barracks bombings in Beirut, Lebanon. This interagency group includes members representing the Pentagon and FBI, as well as the CIA. Though the CTC has been criticized for failing to prevent the September 11, 2001, terrorist attacks masterminded by Osama bin Laden, it did succeed in capturing Abu Zubaydah, bin Laden's chief of operations and recruiting, on March 27, 2002.

In 2004, the National Commission on Terrorist Attacks on the United States, popularly called the 9/11 Commission, studied how the government could be reformed to prevent terrorist attacks such as those on September 11, 2001. Their report made several suggestions as to how to improve intelligence operations in particular, including the creation of a National Intelligence Director. This director would oversee all intelligence operations, regardless of the specific agency conducting them. The commission's report stirred a series of proposals and arguments. On August 2, 2004, President George W. Bush called for Congress to establish the position of National Intelligence Director, who would be "the President's principal intelligence advisor and will oversee and coordinate the foreign and domestic activities of the intelligence committee." On August 27, 2004, President Bush issued executive orders enhancing the fiscal authority of the position of CIA director, creating a new national counterterrorism center, and authorizing the creation of a presidential board on safeguarding civil liberties.

Some Americans do not trust the CIA, and the intelligence community as a whole, and are wary of the national security agencies' sweeping new powers, provided through the Patriot Act, to conduct surveillance against U.S. residents involved in terrorist activities. Other Americans state that there has to be some entity protecting the country and that, pursuant to its mission, the tasks and abilities of the intelligence community need be potentially unlimited in technical and geopolitical scope. For better or worse, an intelligence system is indispensable to protecting national security, yet a balance between security and civil rights must be maintained.