of the assistant secretary of war
Herbert J. CAunmings
Division of Foreign Activity Correlation Department of State
SUBJECT: Attached memorandum
Confirming our conversation ofave propared the subject memorandum for you to use as you see fit.
My conversation with Mr. Klaus would indicate that tho Central Intelligence Group as It is nowwould notatisfactory place to put onunit. Xou will note in my last two paragraphs Itho possibility of an Economic Intelligencebeing established in the Central Intelligencef this does happen, of course tho ECOMIC Unit should gothat Group, but until it happens, the other suggestions seem to be more valid.
For the immediatem fully convincedequest coming from either Assistant Secretary Russell or Assistant Secretary Clayton, or both, would guarantee the continuation of the service that both your office and Mr. Surrey's office find useful.
DEPARTMENT Of STATEReancaK'ntlJtwuitt-QisU.n pari and exciseK. 1jw(
This Unit was set up in5 in the Office of the Office of the Director of OSS. It was placed in this office so that "it could draw on all of the Economic and Fiscalin the Agency. On its Executive council wereof all the Intelligence Branohes. The function of the ECONIC Unit was to correlate all of the Economicavailable in OSS files to supplement investigations being conducted by the Department of State or other war agencies. To thisighly selective filing system was installed with the advice and assistance of the International Business Machines Company experts. The system was designed to extract from the rapidly growing files all pertinentreports bearing on any subject of Economic or Fiscal interest, irrespective of how the request formight be couched.
Early in the experience of the Unit, it became apparent that speed was essential in serving the Divisions of State which were the main users of ECONIC material. Thisthe use of highly selective IBM system which can be indefinitely expanded to meet expanded needs.
Diametrically, the setup was as follows:
Plow "of "Economic I f Branches
Today, the ECONIC Section is assigned to the SI Branch because of tho general contraction of the Agency and tho close association of tho two Intelligence Procurement Branches.
The SI 3ranch is chargod with the procurementand dissemination of apot intelligence items. The function of correlation does not belong In this Branch and should be movedosition in the National Intelligence organization, where it will bo of maximum value to the using agencies, present and potential.
It should be borne in mind that the ECONIC Section deals, or should deal, exclusively with the clandestine intelligence of an Economic nature. It should thereforo be
placed near the organization which will collect all types of Economic and Fiscal Intelligence, both overt and covert, so that it can supplement effectively any investigations being conducted byroup.
The National Intelligence Organization as it exists today would indicate that the ECONIC Unit could be attached to any one of three groups dealing with Economic Intelligence in State.
of Foreign Activities Correlation
(liaison With clandestine organizations).
of Economic Security Controls
(chief user of ECONIC material).
5. Economic Branch of Office of Research and Intelligence.
If an Economic Intelligence Division is established in the Office of the Central Intelligence Group to service all agencies with Economic Intelligence, the ECONIC Unit shouldart of that Division to correlateIntelligence received throughclandestine channels, and maintain liaison with those channels.
In this case the Economic Intelligence Division plus tho ECONIC Unit would receive all Economic Intelligence, both overt and covert, file and index it. Thus it would beosition to serve all Government agencies in the
QA13R4 -Original document.