The Office of Strategic Services (OSS) was created by President Franklin D. Roosevelt in July 1942. The OSS replaced the former American intelligence system, Office of the Coordinator of Information (OCI) that was considered to be ineffective. Roosevelt selected Colonel William Donovan as the first director of the organization, who had spent some time studying the Special Operations Executive (SOE), an organization set up by the British government in July 1940. He was also influenced by William Stephenson, the head of the British Security Coordination (BSC). Senior figures in the OSS included George K. Bowen, the head of Special Activities, David Bruce (head of intelligence), William Lane Rehm (head of finance) and Allen Dulles (head of the New York office).
Donald Chase Downes worked with Arthur Goldberg on the Labor Desk. "We were a fortunate combination, able to work together at high speed without friction. Our ideas, our plans, our points of view almost perfectly meshed; our abilities were peculiarly supplementary; our work so mutually understood and developed that each was able at any time to carry on or make a decision for the others." They recruited refugee German trade union leaders who had fled from Nazi Germany. Others who joined included Leon Jouhaux from France and Omar Becu from Belgium.
Downes also persuaded Dr. Paul Schwarz (1882-1951), the former German Consul-General in New York City, to supply the OSS with information. Downes argued that Schwarz "began to spill the German beans - scandals, indiscretions, skeletons... In his forty years in the German foreign service, he had kept elaborate notes... This information he kept in huge filing cases, where there was all the gossip and facts about everyone of importance in German diplomatic and military circles for nearly half a century." Another informant was Ernst Hanfstaengel who had been a close friend of Adolf Hitler until he had fallen out with Joseph Goebbels in 1937. He later was used by Franklin D. Roosevelt as a "political and psychological warfare adviser in the war against Germany."
The OSS had responsibility for collecting and analyzing information about countries at war with the United States. It also helped to organize guerrilla fighting, sabotage and espionage. Some senior US military figures disapproved of the OSS and General Douglas MacArthur refused to allow the organization to operate in the Philippines.
William Donovan was given the rank of major general and during the Second World War he built up a team of 16,000 agents working behind enemy lines. The growth of the OSS brought conflict with John Edgar Hoover who saw it as a rival to the Federal Bureau of Investigation.
The OSS was disbanded in October 1945 and was eventually replaced by the Central Intelligence Agency (CIA).
Espionage is not a nice thing, nor are the methods employed exemplary. Neither are demolition bombs nor poison gas, but our country is a nice thing and our independence is indispensable. We face an enemy who believes one of his chief weapons is that none but he will employ terror. But we will turn terror against him - or we will cease to exist.
Espionage is mentioned in the Bible and was employed by the Greeks and Romans. In 1870 thirty thousand German spies operated in France and the machinations of the espion in the World War are well known. But the League of Nations hoped to diminish secret intelligence by the simple expedient of publishing the military and naval strength of the forces of all nations so that all people would know about each other. Here we fell into the traps by which the honest man usually is trapped. The League knew the strength and intentions of the decent powers; the others kept theirs hidden.
Today our unpreparedness, born of the evangelical idealist's desire to see things the way he wishes them to be, and encouraged by clever secret foreign agents, also abridged our secret gathering of essential intelligence. We are, then, faced with the almost impossible task in time of war of creating a system of secret intelligence that could only have been efficiently established by painstaking preparation over long years of peace. The task would be hopeless except that we have scores of thousands of willing helpers, who, not deceived, maintained their intelligence services.
The Eastern European theatre is at once one of the most promising of all the scenes of future military action but also is a disjointed empire peopled by 100,000,000 aggressive willing friends and corruptible Axis dupes. By employment of the one and the seduction of the other, by cross-checking with the professional operators of our Allies, we can and must make up for lost time, speedily obtain the fullest intelligence and encourage the 'silent peoples' whose courage gained for us time while losing their own freedom and their lives.
On the one hand we must freely use stratagem and on the other, we must be frugal in civilized scruple. We are in a nasty business, facing a nastier enemy.
It took about three weeks for the security checks, I guess, before I was told I was in. We were a very strange batch, because each one of us was going to do something different. I remember one was a doctor, he was always shaking his head at the things we had to do. There was a place where they would try to psychoanalyze you to figure out what you were capable of. One of the things they did was put you in a room and tell you someone lived there and we were supposed to figure out from the traces left behind who the person was, what did he do, what did he look like? It was a kind of a fun thing and everybody had a different idea. Another time we were told to go outside to where a group of men were building something or other and make them do it in a different way. I failed that completely, I couldn't persuade them. I was told later I should have picked up the pistol lying in the room where I was briefed and used it to make the men do what I wanted.
We learned how to handle weapons and throw hand grenades out on the golf course at the Congressional Country Club in Maryland. The members were furious because we ruined the greens. I don't remember the training being particularly rigorous. There was a lot of writing stuff and sometimes we had to trail people, so that we would not lose track of them when we were in cars. A lot of speakers would come down and talk to us. Margaret Mead, the anthropologist, came to talk to us about the pattern of life of people of the South Pacific and how we should approach them - a lot of it had to do with the Japanese, Indonesians and Burmese, the people we were going to be dealing with, and the Japanese mentality.
Intelligence service that counts isn't the kind you read about in spy books. Women agents are less often the sultry blonde or the dazzling duchess than they are girls like the young American with an artificial leg who stayed on in France to operate a clandestine radio station; girls like the thirty-seven who worked for us in China, daughters of missionaries and of businessmen, who had grown up there. I hope that the story of the women in OSS will soon be written.
Our men agents didn't fit the traditional types in spy stories any more than the women we used. Do you know that one of
our most notable achievements was the extent to which we found we could use labor unions? Our informer in this war was less often a slick little man with a black moustache than a transport worker, a truck driver, or a freight train conductor.
In war you've got to get two things - your long-range information and your immediate operational information. We did this kind of thing - from bases in Sweden, Spam, Turkey, and Switzerland, we sent agents into the interior of enemy and enemy-occupied territory. We got a man into the German Foreign Office. He had access to cables coming in from the commanding generals in the field and from German ambassadors all over the world. Then we had a man in the Gestapo itself, in a leading position. We even had one of our own men in a Gestapo training school. By such means we were able to get the first information on the V-l and V-2 weapons, and the use of the island of Peenemunde as a testing area.
We had to know about German tank production. How would you find out about it? Well, we sent some of our young scholar economists in the OSS out on patrols. They examined captured German tanks. Each tank had a factory serial number. We knew that these numbers were consecutive and didn't vary - because we already knew that was the German system. We did the same thing with airplanes. And when we had looked at a sufficient number, we could estimate what production was. When the war was over, we checked. And we found we were only about 4 percent off. How were German casualties running? That was important to know, not merely to tell us about the forces that could be put into the field but also about available manpower for their internal economy. The names of German dead weren't published in the press. But in every little town we found that the local paper carried obituaries of German officers who had been killed. By various means we got the local papers from all the little towns and villages in Germany. We read these obituaries. As in all armies, we knew that there was a rather fixed proportion of men to officers. We knew that there was also a certain ratio between enlisted men and officers killed. So, in that way, our research men skilled in such techniques were able to make an estimate of the strength of the German Army in 1943 that was found to be curiously exact.
Besides obtaining information this way, we also had to fight for it. We did this by sending in small units to seize radio stations or to work with resistance groups. As far as we were able, we went to the minority groups of different nationalities in this country and trained volunteers for hazardous work. Most of these were American citizens of the racial origin and of the language of the country which we were seeking to liberate. Thus we had units going to Greece, Yugoslavia, France, Italy, China, Indochina, and Siam.
About this time (February 1942) George K. Bowden of Chicago was attached to the New York office. George was a young (forties) successful corporation lawyer who had been a "wobbly" organizer and a professional football player in his youth. He had G2 experience in the first war and, despite it, had developed real imagination in intelligence work. Big Bill Donovan had a great confidence in George Bowden, and he carried, in the early, unmilitarized days of OSS, more weight than anyone with the big boss...
Lane Rehm, OSS Finance Officer, was recommended for his job by Averill Harriman and David Bruce. They recommended him because earlier in his life he had been called upon to handle large sums of money when what was needed was incorruptible integrity and a lasting contempt for money, and those who worship it....
There was never a scandal with the hundreds of millions of dollars which passed through Lane Rehm's hands. A man in whom he and Donovan had confidence was never, to my knowledge, refused funds or badgered about his expenditure. But he was highly critical of that small minority of useless OSS colonels who sat in requisitioned villas in Cairo and Algiers and Caserta with little to do but drink and whore and decorate one another's breasts. He made it difficult for them to come by unvouchered funds.
Lane Rehm... has hard, blue eyes, impossible to look into while telling a lie. A straight, closed mouth, with almost no lips. The stern face of a puritan until he smiles, and when he smiles he couldn't look less like a puritan - for he is gay and jolly and civilized - three most unpuritan vices.
The action staff in OSS, especially those in the overseas stations, benefited enormously from being celebrated in prose written by skillful and successful writers. The mythical aspects of CIA took wings almost immediately after the end of the war when two able journalists, Corey Ford and Alistair MacBain, were given permission by Donovan to write a breezy suspense story called Cloak and Dagger: The Secret Story of OSS. It came out in 1945 with a"tribute" by General Donovan, printed as foreword, that began: "Now that the war is ended it is only fair to the men of OSS, who have taken some of the gravest risks of the war, that their courage and devotion should be made known." In 1946 a slightly more substantial book by two first-class writers who had served in OSS, Stewart Alsop and Tom Braden, was written under the title Sub Rosa: The OSS and American Espionage. Alsop and Braden had parachuted into France as JEDBURGH team members; they described the bravery and excitement of the OSS operational missions in stories that still read well and provide a good bit of the substance for later, more systematic books on OSS operations. The literature of OSS revealed some of the frantic improvisation of OSS espionage and covert operations, but it invariably left an overwhelming impression of daring, unconventionality, and heroic achievement. While Alsop, at least, knew enough from his friends in R&A to include some indication of the central intelligence analysis function of OSS, this part of the story seems inevitably humdrum in comparison to the derring-do.
The story of the research and analysis functions of OSS might not have survived at all if it had not been written about by the thoughtful historian, Sherman Kent. Kent stayed on in Washington for a short time after R&A was transferred to the State Department, before he returned to Yale. (He came back to Washington a number of years later to serve for 20 years in CIA's Office of National Estimates.) His book of this period, Strategic Intelligence For American World Policy, finished in October 1948, provided a generation of intelligence officers with a rational model for their profession of collecting and analyzing information.14 By the time the book came out the fledgling CIA was in existence and Kent uses terms that suggest he is describing the new organization. Actually he is reflecting on his experience in OSS's R&A Branch and outlining an idealistic concept of the hard work of the intelligence analyst.
Since it does not really tell what went on in either OSS or CIA, Kent's book is an abstract treatment of a concept that had been articulated but never realized. Kent told me at the time that he had a hard time finding a publisher. There was no broad commercial success for Strategic Intelligence as compared with Cloak and Dagger or Sub Rosa. Nevertheless, the essence of the intelligence process had been captured on paper. As Kent put it, intelligence is "the kind of knowledge our state must possess regarding other states in order to assure itself that its cause will not suffer nor its undertakings fail because its statesmen and soldiers plan and act in ignorance. This is the knowledge upon which we base our high-level national policy toward the other states of the world."Furthermore, Kent observed what is to this day difficult to persuade people about, "some of this knowledge may be acquired through clandestine means, but the bulk of it must be had through unromantic open-and-above-board observation and research." These truths, too, were part of the legacy of OSS, although they were nearly buried under the legends of cloaks and daggers and paramilitary operations.