Our Intelligence Failures

From: John Wilhelm
Subject: For Darren Dick 2 of 2.
To: pat_roberts@roberts.senate.gov
Date: Wed, 1 Sep 2004 13:42:35 -0400 (EDT)September 1, 2004

Darren Dick, For more than a decade I have been quite concerned about
a weakness in congressional oversight of the intelligence community
which has not gotten the attention it deserves.  It is my contention
that the failure of Congress to get an accurate account of the reasons
for our most serious post-World War II intelligence failure, our
inexcusable missing in a timely manner of the impending Soviet
collapse, has obscured much more fundamental problems with the
underpinnings of our intelligence assessments which must be addressed
if we wish to substantively improve our intelligence operations.

In my article on “The Failure of the American Sovietological Economics
Profession” cited in my unpublished letter to the New York Times, I
stated in speaking about that failure that:

     The basic difficulty here is not confined to the specialists
in Soviet economics.  It reflects deeper problems in the way
the discipline of economics, and some other social sciences,
has come to be practiced, and this has troubling implications
for our ability to handle economic and foreign affairs in an
increasingly interdependent world.

In his book, “Ivory Towers on Sand: The Failure of Middle Eastern
Studies in America,” (The Washington Institute for Near East Policy,
2001), Martin Kramer (p. 122) makes the following statement:

 

These theories are powerful totems–far more powerful than the
realities of the Middle East, which are distant and remote from
the American campus.  In such a climate, there is a strong
incentive to put theoretical commitments before empirical
observation.  Even though this has been the source of repeated
error, breaking out of the circle involves professional risk of a
high order.  To put the Middle East before theorizing about the
Middle East is to run the risk of being denounced as a
disciplinary naif or a “latent” orientalist.  In striking
contrast, there is no professional cost for substantive error in
interpreting the actual Middle East.  Indeed, leaders of the
field do it all the time without any negative consequences.

As I believe my piece on our Soviet failure illustrates, it would take
very little editing of this to summarize an essential aspect of that
failure.  In their 1991 report to the House Permanent Select Committee
on Intelligence evaluating the CIA Soviet assessments, the Commission
headed by Professor James Millar stated that the actual course of
events in the Soviet Union between 1988 and 1990 was, even in
hindsight, a low probability outcome.  In light of evidence I
presented in my piece, I do not believe that this assertion has any
credibility.  I believe that an even more dramatic illustration, which
I could not cite in my article, of the disconnect between a competent
assessment of this issue and the assertions of the Millar Commission
is contained in the summary of my analysis in our 1980 Afghanistan
statement contained in the second part of the piece attached below.

It is my contention, that the inability to get an adequate accounting
of our Soviet intelligent failure has left us in a position of not
understanding some of the basic reasons for that and subsequent
failures including our most recent Iraqi one.  If it would be possible
to do so, I would like to have some exchange with you on this and
ultimately with your Senator.  I would greatly appreciate hearing
from you on this.  Thank you for your attention.

John Howard Wilhelm, Ph.D.,
Economics
E-mail address: jhw@ams.org

THE FOLLOWING IN ADDITION TO BEING SOMETHING OF A SUMMARY OF MY
FAILURE PIECE ALSO ILLUSTRATES THAT IT WAS POSSIBLE TO FORESEE
AN IMPENDING COMMUNIST COLLAPSE AS EARLY AS 1980, SOMETHING THAT
THE CIA WITH ITS 100s OF MILLIONS SPENT ON STUDYING THE SOVIET
UNION WAS UNABLE TO DO.

From: John Wilhelm <jhw>
Subject: Predicting the Collapse
To: davidjohnson@erols.com
Date: Tue, 20 Jan 1998 15:43:13 -0500 (EST)

Ray Smith’s statement on the collapse of the USSR “Was it inevitable?
Funny how things that no one predicted in advance suddenly become
inevitable after they happen.” and Patrick Armstrong’s statement that
“Rutland writes ‘Nobody really expresses surprise that the Soviet
system collapsed.’ That is certainly true today but I don’t recall
anybody predicting it at the time.” cannot go unchallenged.

Igor Birman, the former Soviet economist, did predict both the
collapse of the Soviet economy and regime and he did so well in
advance of the collapse.

Birman was one of the first to argue that the Soviet economy was
in deep crisis with important implications for the stability of the
Soviet political system.  In the late 1970s and early 1980s, he began
presenting this argument in lectures and published articles.  Birman
published three articles in English (in the journal Russia which he
edited himself), one in 1981, another in 1985 and a third in 1986
(but written in 1985) which set out his assessment of the state of
the Soviet economy and its implications in considerable detail (Russia
No. 2, 1981, pp. 13-27; No. 11, 1985, pp. 56-67; and No. 12, 1986,
pp. 60-70) and argued that the Soviet economy was in such a serious
and worsening condition that the collapse of the Soviet economic
and political system was likely.

In his 1981 piece, Birman argued that the economy, not Ronald Reagan,
was the regime’s worst enemy–“the enemy which will ultimately destroy
it.”  Birman made it very clear that he expected the collapse of the
Soviet economy and regime within his own lifetime, given his assessments
of the seriousness of the Soviet economic situation.  An idea of Birman’s
insights on this score can be found in the following excerpt from his
1985 article:

A great specialist on Soviet history (Richard Pipes–JHW)
wrote to me recently that, while agreeing with my economic
analysis, he “simply cannot think of a case of a country
collapsing politically because of a slowdown in the rate of
economic growth.”  I admire him very much, but allow myself
to ask why not?  Indeed, the Soviet case is not just some
slowdown.  The core of my analysis is that the slowdown will
continue and the economy will experience negative growth…
Once again–as an economist, I risk drawing only economic
conclusions.  But historians and political scientists should
address the most urgent question–what can happen to the
Soviet regime under negative economic growth?

The above comments were taken from an article I wrote, but have not
been able to get published, titled “The Failure of the American
Sovietological Economics Profession.”  I wrote it in part because
I was, and still am, very troubled by the contents of a report given
to the House Permanent Select Committee on Intelligence in the early
1990s which I regard as a very dishonest whitewash of the CIA and the
profession.  (Danial M. Berkowits, et.al., “Survey Article: An Evaluation
of the CIA’s Analysis of Soviet Economic Performance, 1970-90,” COMPARATIVE
ECONOMIC STUDIES, Vol. 35, No. 2 (Summer 1993), pp.33-57.

If one looks at the record, given what we now know about the Soviet
economy, I think that an unbiased observer will see that both Naum
Jasny and Igor Birman, who did get the economy more correct than the
profession, were treated by that profession very shabbily.  This was
not an unimportant factor in the profession’s failure to have gotten
the Soviet situation right.

On the matter of inevitability I would also like to add a prospective,
rather than a retrospective, analysis of the issue which I believe
speaks for itself.

In early July 1980 the late Rajab Karim (a former Dean of the School
of Engineering at Kabul University), Phil Schafer and I circulated at
the Republican Convention in Detroit, at the suggestion of Senator
Helms, a statement on the Afghanistan situation.  I wrote the part of
the analysis dealing with the implications of the situation for the
Soviet Union and Eastern Europe.  The parts of my analysis which I
believe relevant to the inevitabily issue are as follows:

Undoubtedly, if they so choose, the Soviet leaders have the
military means to crush the Afghan resistance.  But there are compelling
reasons for believing the the Soviet leaders face considerable
obstacles that effectively limit their application of military power
in Afghanistan.  This makes it possible for the Afghan resistance to
defeat them were it to receive adequate assistance from the outside.

Based on personal observations and other sources available to
us, we believe that the Soviet Union is potentially unstable to a
degree that is not appreciated outside the country.  We further
feel that the factors responsible for this instability are important
to keep in mind in assessing the Afghan situation and its implications
for American foreign policy.

One factor to be noted here is the fact that in the Soviet Union
the perception of a stagnant, or even declining, standard of living
has been growing in recent years among an important sector of the
Soviet population, the “Russian middle class.”  The rather serious
deterioration in the current food situation undoubtedly is reinforcing
this perception.  The fact that rumors are circulating in Moscow about
worker strikes over food illustrates the gravity of this condition for
the Soviet leaders.  This is one reason why it is terribly important
to tighten up and enlarge the current grain embargo.  While the Soviets
have circumvented this by purchases from Argentina and the like, lifting
the embargo would give them at least some, if not all, of the additional
grain they may need to ease their present food problem.  Thus, we believe
an effective embargo should be kept in place as a means of keeping up
the pressures on the Soviet leaders over Afghanistan.

There is not a single Russian family that has not lost someone
in the two world wars.  As a consequence of this, there is, particularly
among the Russian element of the population, a very strong desire for
peace.  The Soviets cannot sustain heavy losses in Afghanistan without
the population becoming aware of them and becoming terribly concerned.
This can place a limit on the ability of the Soviet leaders to respond
militarily to the situation in Afghanistan.  As long as the United
States continues its economic pressures and as long as the Afghan
resistance continues to be effective, which will require outside aid,
the Soviet leaders face growing internal pressures which they can only
view as being very dangerous.

On the other hand the Soviet leaders cannot afford to lose in
Afghanistan.  Such a loss would create a serious problem for them
and an important opportunity for the United States.  What is not
appreciated in the West is the extent to which Soviet foreign policy
is motivated by internal factors.  The Soviet Union is an exceedingly
unhappy place in which to live.  This is very much the consequence of
the failure of the Soviet regime to deliver on its promises and the
way in which it treats its own people.  The result of this is that
from an internal perspective the Soviet regime lacks a certain degree
of legitimacy.  It trys to make up for this in its foreign policy.
Continued success in the establishment of self-proclaimed “socialist”
regemes is important to the Soviet government to demonstrate to its
people the validity of marxist historical inevitability and in the
process to legitimize the regime before its people.  Because of this
we feel, as one Soviet emigre has pointed out to us, that Soviet
failure in Afghanistan could have a profound impact on the Soviet
Union internally.

In addition, a Soviet failure in Afghanistan could also have an
important impact on Eastern Europe.  The situation in Poland is, to
say the least, quite unstable.  Were Soviet control over Afghanistan
to falter, the Poles may well  be encouraged to push for greater
independence at a time when the Soviet leaders would be less able to
intervene as they have in Prague and Kabul.  The successful defection
of a country like Poland from the Soviet block would have an even more
profound shock on the Soviet empire.  As a consequence of this and
the other considerations discussed above we believe that the Soviet
Union finds itself on the horns of a serious dilemma.  If, in the
presence of Afghan resistance and Western support, it trys to pursue
victory in Afghanistan, it would create dangerous pressures internally.
If, on the other hand, it is forced out of Afghanistan it could face
serious problems within its own camp….
.
.
.
Perhaps, however, more important from the US viewpoint is the
potential impact of a Soviet Afghan defeat on future American-Soviet
relations.  If it is honest about the situation, the US has to recognize
that detente with the current Soviet leaders has been a failure.  Its
problem, given the age of the current Soviet leaders, is really one
of the relations that will be established with their successors.
The Soviet fate in Afghanistan cannot but affect how those new leaders
will relate with the US and the rest of the world.

Under present circumstances US foreign policy faces a basic choice:
either submit to the Soviet drive to dominate or at some point face
down the Soviet Union.  We think the former possibility is a dreadful
prospect for us all.  And we believe that the longer the US waits to
face down the Soviet Union, the more costly and dangerous it will
be to do so.  Given the determination of the Afghan people to
resist Soviet domination, Afghanistan may represent the best prospect
the US may have to face down the Soviets at a reasonably low and
safe cost.  Our plea is the the US not pass up this opportunity.

IT IS MY JUDGEMENT THAT IT WAS INEXCUSABLE THAT THE PROFESSION DID
NOT FORSEE THE BREAKDOWN OF THE SOVIET EMPIRE AS IT WAS SO VERY OBVIOUS
IN THE EARLY 1980s.  AND IT IS UNFORTUNATE THAT IT DID NOT DO A BETTER
JOB OF MAKING PEOPLE AWARE OF THE WONDERFUL OPPORTUNITY OPEN TO US AS
A RESULT OF THAT BREAKDOWN.  PERHAPS HAD IT DONE A BETTER JOB THE VERY
UNWISE POLICY OF EXPANDING NATO WITH ITS VERY LIKELY UNFORTUNATE
CONSEQUENCES MIGHT BE MORE AVOIDABLE.

John Howard Wilhelm, Ph.D.,
Economics
E-mail address: jwh@math.ams.org

P.S. I would be interested in anybody’s comments on the above