COLUMN ONE : Jobless in the Name of Security : Thousands are fired each year under Pentagon’s system that examines personal lives in an effort to ferret out spies. Critics say the decisions are arbitrary. Officials deny bias but offer no explanations.

After working at Lockheed for 26 years, Terry Liggett last year was abruptly ordered to clear out his workbench and leave the company property in two hours.

An anonymous, low-level Air Force bureaucrat had ruled that he was a national security risk and could not get clearance for a new job assignment at Lockheed’s secret Skunk Works plant in Palmdale.

Liggett, 44, a computer technician for industrial machinery, later learned that the federal government was not questioning his loyalty. The problem was his Brazilian wife, who immigrated legally in 1984.

In the Pentagon’s view, Liggett had “foreign involvement” that undermined his trustworthiness--despite his family’s long connection to Lockheed. Liggett’s mother worked in the firm’s canteen during World War II. In the 1950s, his father was chauffeur to legendary company chairman Robert Gross.

Liggett’s discharge papers were branded “Code F” for foreign involvement. As a parting comment, a government security officer suggested a divorce might help his situation, Liggett recalled. He still has not found a job.

Three million Americans hold clearances issued by a federal security system that critics charge is arbitrary and inconsistent. Each year, this system forces thousands out of defense industry and government jobs, in many instances dispassionately laying waste to careers.

Intent on rooting out every possible mole or worker vulnerable to blackmail, the government delves deeply into employees’ private lives. Disqualifications can be based on family ties, sex practices, alcohol or drug use and spending habits, among other factors.

At its worst, critics claim, the system discriminates against people with foreign kin--with especially painful results for Asian-Americans. They say those deemed untrustworthy often are given no explanation and offered no appeal, raising constitutional questions. A denied or revoked clearance becomes a permanent blot on a personnel record; it must be disclosed on every future clearance application.

“It comes down to straight discrimination based on national origin,” said Jaak Treiman, an attorney who represents defense industry employees. “The people who run the system don’t feel the Constitution applies to them.”

Defense Department officials declined interviews on security issues and refused to respond to most written questions, but said in a statement that their policies are not discriminatory. Generally, federal officials have said that stringent security is necessary because the United States continues to face serious commercial and military espionage threats from China, Iraq and Russia, among other nations.

Weapons contractors are supposed to be the front line of the industrial security Establishment, putting them in the middle of a smoldering controversy. Some workers accuse the companies of compounding the system’s unfairness by “pre-screening” candidates for clearance, preempting any recourse for those who are rejected. For their part, employers say security--and any resulting dissatisfaction--is the government’s responsibility.

Initiated by President Dwight D. Eisenhower in the early 1950s, the security system was rooted in fears of nuclear war and the belief that extraordinary efforts in private industry were justified to protect America against the Communist threat.

Although political upheaval has swept the world since the end of the Cold War, the security system remains virtually unchanged. The massive reduction in the U.S. military Establishment raises basic questions: What kind of security system does the nation need? Can it operate more fairly?

Ironically, recent academic research suggests that many of the Pentagon’s most controversial security rules do little to weed out spies or prevent espionage.

Federal officials and their counterparts in industry are reviewing the entire system--more out of concern for costs than human impact. Wholesale changes are considered unlikely, and whatever revisions are made will take years to implement.

Although questions of fairness have long dogged the system, the issue is growing more urgent as the defense budget shrinks and defense industry jobs become scarce, especially in recession-battered Southern California.

For workers, a denial once was an inconvenience that forced a switch to a job that did not require clearance. In today’s tight market, aerospace workers fired over a clearance problem often have little prospect of finding work.

‘Special Access’

Through the years, the security system has grown more stringent, more exclusionary and more shrouded from public oversight.

During the 1980s, secret projects--known generally as “special access programs”--grew significantly. Hundreds of government offices and projects came to operate under myriad security rules, not subject to public, judicial or congressional review.

The Defense Department declined to say how many of these programs exist. They include such Southern California-based projects as Northrop’s B-2 bomber, Lockheed’s F-117 Stealth fighter jet and TRW’s spy satellite programs--not to mention others in the so-called “black” realm that are not publicly disclosed.

To work in the amorphous world of special access, workers such as Liggett must meet tougher standards than for other security clearances--secret rules that disqualify workers who have immediate family members living abroad, a spouse who is not a citizen, a history of bankruptcy or a record of experimentation with marijuana and other drugs, even if long ago.

Since these programs often involve the nation’s most advanced military technology, defense officials make no apologies for contradictions that might arise in the clearance process.

“There has been an understanding for 50 years that the personnel security system has been inconsistent,” said Steven Garfinkel, director of the Information Security Oversight Office, part of the General Services Administration. “A person can get cleared by agency A and be turned down by agency B.”

The Pentagon declined to say how many people work in special access programs. But a recent General Accounting Office report estimated that 250,000 civilians and military personnel are involved in special access programs. Another 214,000 Americans are covered by closely related government security rules on intelligence programs--known as “sensitive compartmented information.”

Defense industry surveys indicate that the majority of these programs are based in the West. The rejects--many of them highly educated and professionally accomplished--are here in abundance, too.

Last year, Jan Alexander Grzesik, a Harvard- and UCLA-trained physicist who fled Poland as a 7-year-old boy after World War II, was denied clearance by the Air Force on the B-2 bomber program.

Grzesik presumes the Air Force suspects he may be a communist mole--even though he has held U.S. citizenship for 30 years and worked on other top-secret projects at TRW.

Since early 1980, in probing interviews with government security agents, Grzesik has tried to prove his loyalty to America. During that time, even Poland has renounced communism, he notes. Although he holds a Ph.D. in electromagnetics, he has been unemployed for more than two years.

“Your judges are hidden,” Grzesik said. “It is very difficult to articulate a defense. My own links to Poland have triggered the most pre-programmed xenophobia. I am totally innocent.”

The Pentagon refuses to say how many people are refused special access, but it denied or revoked 4,700 standard clearances in 1992.

For those who run afoul of the security system, the human consequences can be devastating. Liggett, the fired Lockheed worker, said his wife, Rosane, has discussed returning to Brazil.

“I don’t understand the whole situation,” said Rosane, a college librarian. “My personal life, my working life is a mess. We may lose our house now. After 26 years at Lockheed, look how the company and the government is treating him.”

If Bill Clinton were not President, it is questionable whether he could qualify for many Pentagon clearances--given his admitted history of trying marijuana, allegations of extramarital affairs and a clouded draft record.

Michael Green, a former security officer for Northrop’s B-2 program who conducted background investigations, said he would have rejected Clinton under B-2 access rules in effect during the late 1980s. But Clinton--like federal judges, members of Congress and governors--automatically gets any clearance necessary to do his job.

Ordinary citizens applying for defense work face quite a different process. They must fill out extensive forms, be fingerprinted, submit to lie detector tests, provide urine samples for drug testing and agree to lengthy, intrusive interviews. Security investigators also question neighbors, relatives and other associates.

“In deciding whether to grant or deny a clearance, the government compels employees to disclose the most intimate details of their private lives,” Joshua Bowers, an attorney with the National Federation of Federal Employees, told a congressional hearing in May.

Among the union’s concerns are Pentagon questionnaires that require disclosure of arrests or detainments by police, regardless of whether charges or convictions resulted. A legal challenge by the union to the questionnaires failed in federal court earlier this year.

Nor is it clear that the Pentagon’s standards reliably identify prospective spies. Not until the 1980s did the Defense Department formally begin to study the motives for espionage.

The inquiries have turned up some surprises.

In the 117 acknowledged espionage cases in the United States since World War II, the majority of spies were motivated by greed, rather than being blackmailed for unusual sexual practices or foreign connections, according to a report last year by the Defense Personnel Security Research and Education Center in Monterey, Calif.

And while many people with foreign connections get standard security clearances, the study found that hardly any turn out to be spies. Only four Americans were coerced into espionage when a foreign country made threats to family members residing abroad; no such cases have occurred in the last 15 years.

Few of the spies were defense industry workers. While defense workers hold one-fourth of the 3.1 million government clearances, only eight spies came from industry. The rest were civil servants or uniformed military personnel.

Facing Obstacles

Asian-Americans in particular believe that the federal government has subjected them to unreasonable scrutiny, even as they play an increasingly important role in aerospace. Many are facing serious career obstacles because of clearance problems, according to the Chinese Engineers and Scientists Assn. of Southern California.

“When you are restricted from a clearance, you feel you are not American at all,” said Phillip Chen, vice president of the group.

Only one of the 117 spy cases involved an Asian-American--CIA translator Larry Wu-Tai Chin. Accused in 1985 of spying for China for 33 years, Chin committed suicide in his jail cell before trial.

Yet security rules are tough on Asian-Americans, who comprise half of all engineering graduates in California. Green, the former Northrop security officer, said that Asian-Americans faced higher-than-average rejection rates of more than 50% on the B-2 program.

“We had guys who were brilliant--a lot of Asian-Americans--who couldn’t get through because of family abroad,” he said.

In a statement to The Times, Pentagon officials said that the security system is not discriminatory. Yet they also said there was no data available to determine the rules’ impact on minority groups.

“I am not aware that anybody has looked at whether clearances have been applied fairly on a racial basis,” the GSA’s Garfinkel said.

He said that special access rules do not disqualify workers who have immediate family members abroad. Yet the National Security Agency’s security guidelines for contractors, which The Times obtained, state: “Close and continuing associations, which are characterized by ties of kinship, affection or obligation, are prohibited with any non-U.S. citizen.”

Industrial security officials acknowledge their deep concern about Asian-Americans’ foreign ties, although they insist that outright discrimination is not their intent.

These rules “make sense,” said Lynn Mattice, former Northrop vice president for security. “There is a very dramatic concern about Chinese foreign intelligence in California.”

That worry is compounded by the perception that Asian-Americans are more vulnerable to manipulation of their families, said Lawrence Howe, vice president for security at Science Applications International Corp., a San Diego defense contractor.

“The folkway is that by and large, the Asian community tends to be bound far more closely by family ties than maybe other national groups,” he said.

The security system’s definition of “family ties” seems inconsistent. In some security manuals, the term applies to siblings, parents and grandparents. But a Chinese-American scientist at Northrop said he was denied access on the B-2 program over concerns about his wife’s aunts and uncles in Canada.

“The personnel security system is highly arbitrary to the point of being corrupt,” said Steven Aftergood, senior analyst at the Federation of American Scientists, which has long contended that the industrial security system is flawed and costly. “Somebody has been reading Kafka in drawing up these rules.”

One inherent problem is that government agencies have more difficulty investigating individuals who grew up in foreign countries--raising barriers in the clearance process for many immigrant groups, including Asians, Latinos and Eastern Europeans.

Advocates for Indian-Americans say they also face serious problems. Earlier this year, the Air Force denied special access to engineer Thasmuthu Ramakrishnan because his two elderly sisters live in Madras.

Ramakrishnan eventually won back clearance after The Times published an account of his case. By then, an Air Force spokesman said the whole thing had been a mix-up.

Such miscommunication within the government bureaucracy may be more common than is realized.

Samuel Brookins, an African-American attorney for Hughes Aircraft, was denied a security access in the early 1980s after allegations were made that his wife was a radical activist in South-Central Los Angeles, according to another Hughes executive who learned of the incident from a government security official.

Brookins’ wife, Gloria, was a member of the National Assn. for the Advancement of Colored People. But she said she never was involved in militant groups.

Brookins, now retired in Los Angeles, said he never was told why he was denied clearance. He did not regard the denial as a career problem, he said, but suspected a disgruntled subordinate had made damaging statements about him.

Defense Department clearance rules forbid political activities that are intended to destabilize or overthrow the U.S. government. In a written statement, the Pentagon said membership in the NAACP would not be a basis for special access denial.

Constitutional Issue

When errors of judgment occur, they often go uncorrected.

A General Accounting Office report issued last month found that special access programs largely fail to provide the constitutional right of due process.

A defense industry survey cited in the report found that 70% of workers received no explanation when they were denied clearances, and 60% were given no chance to appeal. Such practices violate the Pentagon’s own rules for due process, the GAO said.

When appeals are allowed, denials are reversed at least 10% of the time, according to the report. Frequently, however, the appeals are ruled on by the same officials who issued the initial rejection, the GAO found, so there is no independent oversight.

“It is a right that Americans be entitled to decent treatment,” said Rep. Don Edwards (D-San Jose), whose subcommittee on civil and constitutional rights asked for the GAO report. Edwards has pushed for reforms for years.

Pentagon officials dispute the GAO findings. In a response, Maynard C. Anderson, an assistant deputy undersecretary of defense, said Pentagon rules “satisfy legal requirements.”

Americans do not have a constitutional right to classified information, Anderson argued, so a clearance denial is not a denial of rights. The Pentagon also says that it is not required to provide due process in cases where a special access program is not acknowledged to exist--a position it hopes to incorporate in the new security rules being drafted.

But the American Bar Assn.--which long has called for a system of due process covering all clearances and access in government programs--disagrees.

“Under the 5th Amendment, one has a right to not have liberty or property deprived without due process,” said Sheldon Cohen, an attorney who chairs the association’s national security committee. “A job is both a liberty right and property right, so those cannot be denied without due process.”

Cohen said that the U.S. Supreme Court has never ruled on the issue and lower court rulings appear contradictory. Indeed, the federal judiciary has been reluctant to venture into government security issues.

One exception came in a 1991 ruling on a Pentagon regulation established in the aftermath of a series of 1980s spy scandals. The rule required employees to have at least 10 years of residency and five years of U.S. citizenship to qualify for a standard secret or top secret clearance. It was struck down in a case brought by Vietnamese-American engineer Phong T. Huynh, who spent eight months in a communist labor camp before coming to the United States to study engineering in 1979.

U.S. District Judge Thomas Hogan in Washington, D.C., ruled that “government action that classifies citizens on the grounds of national origin is inherently suspect.” He added that the government failed to prove that a “compelling state interest” was served by such discrimination.

“When I came here, I became a citizen,” said Huynh, now a Navy employee. “I pay taxes. I have the same rights as any other American.”

Hogan required the Justice Department to set up a special program to settle claims from workers who were harmed by the rule. Nine people have received a total of $158,000 in back pay, and another 28 cases remain open, Justice Department attorney Robin Stutman said.

Treiman, the attorney, suspects that special access rules may violate individuals’ rights in the same way as the rule struck down in the Huynh case. Although the Pentagon sets the rules, the defense industry plays a major role in enforcement through pre-screening of employees or prospective employees, according to a Lockheed survey of firms that have special access programs.

The survey, a copy of which was provided to The Times, showed that about 85% of contractors in special access programs are required to pre-screen employees--often without written guidelines.

As a result, it often is not clear whether it is the government or corporate security officers that are denying clearances.

Aftergood of the Federation of American Scientists contends that pre-screening frequently is a ploy used to deprive workers of an appeals procedure. The government does not provide appeals for employees rejected in pre-screening because it does not consider a worker officially rejected until a formal application for clearance has been turned down by a government agency.

Some employees suspect that pre-screening can lead to corporate abuse.

James Carl, a flight test mechanic, said Lockheed told him that the Air Force denied him special access for one program at the Skunk Works, even though he had held other special access clearances. But in a subsequent union arbitration hearing, it was disclosed that the company had never submitted his application to the government.

Lockheed spokesman James Ragsdale said that clearance issues are “a fairly constant source of unhappiness,” but that “all the decision-making is in the hands of the government and not the company.”

Worker representatives remain dubious.

“It is a hard area to deal with because the company has more to do with these denials than we can prove,” said A.E. (Charlie) Brown, president of the Lockheed machinists union. “They have used this in the past to weed out people they don’t want.”

Brown said “the government had a fit” after the union negotiated a contract clause allowing a grievance procedure for security clearance denials in 1983. The clause was later rescinded, and employees now have no appeals.

“The system stinks,” Brown said.

The Spies Among Us / Rogues Gallery

The federal government made it harder to obtain security clearances after a series of spy scandals rocked the intelligence and military communities in the 1970s and 1980s. Some of the worst episodes:

John W. Walker: Admitted in 1986 to spying for the Soviet Union for 18 years, during which he received an estimated $1 million for disclosing such secrets as the Navy’s system for tracking Soviet ships. Walker recruited his son and brother into the ring as well.

Jonathan Pollard: Over 18 months he sold 1,000 secret documents to Israel while working for the Naval Investigative Service’s anti-terrorist alert center in Maryland. He was given a life sentence in 1987.

Larry Wu-Tai Chin: A Central intelligence Agency translator, he was accused in 1985 of having spied for China for 33 years. The only Asian-American since World War II to be charged with espionage, he committed suicide in his jail cell before trial.

Christopher Boyce: Along with boyhood friend Dalton Lee, he spied for the Soviet Union for 21 months while working at TRW in Redondo Beach. Boyce worked inside a secret vault at TRW, where he had access to secrets about U.S. spy satellites. He was convicted in 1977.

Who are the Spies:

Americans who spy on the United States are overwhelmingly white males who work for the government. Here is a breakdown of some other key characteristics. (Numbers in parentheses indicate the total out of 117 spy cases.)

Gender: Male (108); Female (9)

Race: White (108); Black (7); Other (2)

Age: Median (28.5); Range (18 to 69)

Marital status: Married (65); single (39); separated / divorced (11)*

Employer: Navy (33); Army (22); Air Force (21); defense contractors (8); Central Intelligence Agency (7)*

Payment received for spying: No payment (47); $50-$10,000 (21); $10,000-$100,000 (17); more than $100,000 (10)*

Why They Spy:

Greed is the primary reason Americans spy against their country, according to a 1992 study commissioned by the Department of Defense. The study concluded that ideology, disgruntlement and revenge are other major motivations for espionage.

Primary motive (as % of total cases) Money: 52% Ideology: 18% Disgruntlement / revenge: 15% Ingratiation: 9% Coercion by foreign intelligence personnel: 4% Thrills / self-importance: 3% +

Spying Incidents by Decade: 1940s: 14 1950s: 12 1960s: 19 1970s: 24 1980s: 48 Source: “Americans Who Spied Against Their Country Since World War II,” a report by the Defense Personnel Security Research and Education Center.

The Secrecy System

Some 3.1 million Americans working for government and the defense industry hold security clearances. Even the lowest level of clearance requires a background investigation, checking at least five years of an individual’s employment, education, financial and personal history. The federal government has issued 341 security directives covering clearances, ranging from the Energy Department to the CIA. Here is a guide to the various levels of secrecy.

* SIOP-ESI: Among the highest levels of security access is “single integrated operation plan--extremely sensitive information,” giving holders the details of America’s plans for waging nuclear war.

* Special Access: Covers some of the nation’s biggest secrets. In addition to a standard clearance, individuals involved in special-access programs are subject to extensive background investigations going back 15 years. Some super-secret programs require unusual rituals, such as passwords or handshakes to open and close conversations. (Such conversations must be conducted in locked vaults with specially insulated walls and background music to foil eavesdropping.)

* Top-Secret: Documents categorized as top-secret would cause “exceptionally grave damage” to national security if obtained by hostile parties.

* Secret: Covers access to documents that could cause “serious damage” to the nation’s security if disclosed.

* Confidential: A low level of access. Virtually every employee in a defense plant doing any classified work has a confidential clearance.

Getting Special Access

Special access programs are among the nation’s most secret military projects. Workers must meet tough personnel standards for clearance. Although the Pentagon will not disclose those standards, industry sources provided the following details:

* Foreign connections. U.S. citizens with relatives in designated countries often are denied clearance. In many special access programs, any foreign relatives are grounds for disqualification.

More often, the designated countries include the former republics of the Soviet Union, Vietnam, North Korea, Middle East nations and China. Frequently, employees are excluded if their spouses or other close kin are legal U.S. residents but not citizens.

* Drug or alcohol use. Under Defense Department guidelines, an individual who regularly used marijuana can gain clearance if the use was stopped at least two years earlier. But special access programs can create their own, tougher rules. Rules on alcohol usage vary.

* Sexual practices. Although the Defense Department no longer has an outright ban on granting clearances to homosexuals, many special access programs continue to discriminate against gays and lesbians, according to congressional investigators.

Under Directive 5220.6, heterosexual practices that indicate “moral turpitude” can also be grounds for denial. These practices include exhibitionism, sodomy, bestiality, self-mutilation and incest. Until the 1980s, adultery was closely monitored, on the theory that an employee’s fidelity would be a good indicator of loyalty to the nation.

* Bankruptcy, garnishments and repossessions. A pattern of financial irresponsibility is presumed to make someone vulnerable to bribery. In some special access programs, no bankruptcy filings are permitted in the previous 15 years, and no garnishments of wages in the previous five years.

* A past record of sloppy security practices. Interviews with security experts and Pentagon records indicate that surprisingly few clearances are denied or revoked because an individual had performed security duties poorly.

The Enemy Within

* Today: Thousands of Americans lose defense jobs every year because they are denied clearance by an industrial security system that critics contend is capricious and unfair.

* Monday: U.S. defense contractors say the $13.8 billion spent each year for security at weapons plants is a wasteful anachronism of the arms race.

* Tuesday: In the aftermath of the Cold War, U.S. officials are struggling to balance defense conversion efforts and the preservation of needed secrecy.