Privatize the CIA? Radical Idea Is Being Considered : Intelligence: Its backers say outsiders could handle much of the analytical work. Foes question focus, quality.

He doesn’t carry credentials, and you wouldn’t think him a spy. Yet for 15 years, Bruce Bueno de Mesquita has done the work of the CIA.

He has predicted developments in the Philippines before and after the Ferdinand E. Marcos regime. He has gauged the stability of the Mexican government. He has monitored internal peace agreements in Cambodia.

Bueno de Mesquita is not on the staff of the Central Intelligence Agency. Rather, he is a professional consultant and senior fellow at the Hoover Institution here, a private business contractor shepherded into the veiled society of the world’s premier intelligence organization from time to time to lend a hand.

Today, as the CIA struggles to adjust to a vastly changing world and a suddenly unsympathetic Congress, it is being forced to consider the radical idea that more of the intelligence collection and assessment work traditionally reserved for its own agents and analysts should be turned over to outsiders such as Bueno de Mesquita.

All over Washington, as the effort to reduce federal spending grows more intense, government agencies are being prodded to re-examine how they do their jobs. In an era in which privatization is a popular buzzword, many are leaning toward contracting for functions they have always handled in-house.

But privatize the CIA?

The extent to which that is possible or desirable is a complex question. But the fact that it is even being addressed indicates how drastically the old Cold War assumptions have been eroded. “You could not completely privatize the CIA,” said Bueno de Mesquita, “but you could privatize a pretty high percentage of it.

“A lot of people imagine it’s all cloak and dagger. But there is a lot the government cannot do as efficiently as the private sector. And the vast majority of the intelligence work is just having people read newspapers and listen to radio speeches, and a lot of that could be readily privatized.”

In part, this assessment reflects the fact that--while the public may think of the CIA as primarily occupied with stealing secrets and carrying out covert operations--much of its work is actually a form of academic research: assembling economic, social and political information about foreign countries and their leaders, then using this information to make informed estimates of their goals, intentions and future actions.

That is the analysis side of the CIA--distinct from the operations side--and it has not escaped the scrutiny that the rest of the agency is receiving these days from Congress and other critics.

In the post-Cold War world, why is taxpayer money still being used to pay CIA staffers to gather and assess information that, critics say, is often available more quickly and efficiently through cable TV and the Internet? In this Information Age, what secrets are left?

Senate and House committees responsible for intelligence, along with a special White House intelligence commission, will be grappling with these dilemmas throughout most of this year.

Deputy Defense Secretary John M. Deutch, President Clinton’s nominee for director of central intelligence, will also be a player.

How far this process should go, however, especially if it involves reducing the CIA’s own analytical capabilities and relying more on the private sector to supply intelligence analysis, is a matter of continuing dispute.

Even some already working as private intelligence consultants warn that it can be bad policy for the government to let loose of too much of its intelligence work.

Angelo M. Cordevilla, who like Bueno de Mesquita is a senior fellow at the Hoover Institution, has written extensively about the nation’s spy network. But if he had his way, he would kill the agency before he privatized any part of it.

“That is most foolish,” he said of turning over intelligence gathering and analyses. “Intelligence is properly a government function. It should not be privatized.”

Cordevilla has reviewed intelligence work done under contracts by other outsiders and has found some of it wanting.

“Some of it is useless trash,” he said recently, “such as fertility studies in Bangladesh or social science predictors on war.

“The Romans used to predict war by hiring guys to read the entrails of chickens or to watch the behavior of chickens as they were being plucked. Now I think some of our social science studies today have about as great an insight into war as the Roman chickens. And I bet the chickens were a lot less expensive.”

While the best independent scholars are clearly the equals of any government analyst, the best may not always be available, critics of heavy reliance on contract work note. Or the top scholars may be focusing on different issues and questions than those that the policy-makers consider most urgent.

Beyond quality, there are other questions.

For one thing, while the two fields have much in common, there are significant differences between intelligence analysis and academic or think-tank research. Intelligence agencies are expected to address specific issues and questions put to them by the President and other policy-makers, sometimes under tight deadlines and rules of secrecy. Academics are not normally accustomed to working under those constraints.

And while the Cold War is over, military issues remain important for intelligence analysts. Much military intelligence remains classified, and using outside sources in this area has its limitations.

Nor are outside analysts necessarily freer of political, institutional or other biases than government experts. And because an intelligence agency’s personnel are under its direct control, corrective action is at least possible.

Finally, skeptics of privatization say, this may be the Information Age, but it is just not true that all the information needed by intelligence agencies is freely available. Countries such as Iraq and Iran, for example, do their best to conceal many kinds of information--economic and political, as well as military. Even U.S. allies have their secrets.

And the bottom line for most proponents of keeping the CIA’s analysis system essentially as it is today is accountability.

Given the potential stakes when a President turns to the CIA for guidance, do you want the White House dependent on outsiders--possibly the lowest bidders? Or do you want the services of full-time, professional intelligence specialists who are directly accountable to the President and Congress and no one else?

Robert M. Gates, the CIA chief under President George Bush who has been pushing a 10-point plan for reshaping the agency, questions the value of more private contracting because it “still costs money.”

Rather, he would turn much of the CIA’s basic research back to the various government agencies--for example, Russian grain reports to the Department of Agriculture--and then intensify the CIA’s own efforts on its core mission--spying.

“In today’s political environment, particularly in this post-Cold War environment, people need to understand again what the intelligence community does best,” he said.

And Sen. William S. Cohen (R-Me.), a member of the Senate Select Committee on Intelligence, said in a recent hearing that it is outlandish to bring the public too far into the information-collection business.

But proponents of a more substantial role for the private sector in intelligence see the issue primarily in terms of economy and efficiency. These days, much of the data that the CIA and other government intelligence staffers compile is already available from public sources, they argue. And private experts can do the same analyses cheaper--in fact, they may have already done it.

With the explosion of open sources throughout the world, why should the CIA continue to spend hundreds of thousands of dollars duplicating research on farm produce in Eastern Europe, for instance, when such information is already being compiled privately?

Can’t the CIA find what it needs on the information superhighway?

Roy Godson, who is president of the National Strategy Information Center--a Washington think tank--and has been hired at times to work for the CIA, believes that it often can. Ironically, he said, it was the fall of the Communist Bloc--perhaps the CIA’s greatest aim since its inception--that now makes it possible to parcel out more work to the private sector.

“The end of the Cold War freed us,” he said. “It created a lot of opportunity for open-source collection.”

Charles Wolf Jr., dean of the RAND Graduate School and director of its international economic research project in Santa Monica, said the CIA’s directors have slowly been asking others to evaluate their work. He was one of a small group of experts contracted by the CIA to evaluate an agency study of the Russian economy in the 1980s.

It makes good business sense for the agency to buy research and analysis projects that are already completed or are under way and can be had for a lot less money than it would take to do them inside the CIA, he said.

“They were resistant to do it in the past. They were like most government agencies and would like to do things themselves. But it would be an encouraging sign to have more openness and research into their own estimates. It would be very encouraging.”

Former Director Allen Dulles helped father the modern CIA, but it was his grandfather, former Secretary of State John Watson Foster, who a century ago first saw the advantages of tapping public sources of information to gather secrets about foreign countries.

In 1892, Foster dispatched military attaches to embassies and legations in London, Paris, Vienna, Berlin and St. Petersburg. He directed them to examine military libraries, bookstores, publishers’ lists and other open sources that would give insight into weapons being developed by foreign countries.

But it was only last year that the CIA began its own Community Open Source Program. It is designed to determine everything that is available in the public realm and to make sure the agency is in a position to get it all.

As that is being done, said program director Joseph Markowitz, the agency is realizing that private industry already gathers much of what the CIA wants and is paying its own people to assemble.

“As the government downsizes, it is deciding that outsourcing is a valuable tool, and it’s doing that throughout the government.

“And as the information industry grows and becomes more competitive, we will be able to get it cheaper and better, so that’s all for the good. Because if somebody has already translated it or formatted or put it in databases, that’s all to the better. I think the whole government is looking at that.”