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data, then we do not have to put a classification on it, but if the item is a classified item and we report on that, we have to classify that paragraph in the report that we issue.

Mr. FASCELL. You do not feel it is incumbent on the Office to go behind the original classification? You may be lifting something out of a document and the whole document may be classified but that which you lifted out may not be classified in the original instance?

Mr. BLAIR. That would be unclassified then.
Mr. FASCELL. If you could determine at that point?
Mr. Blair. That is right. The monthly summaries on Offshore

BLAIR Procurement issued by the military signify the nature of the classification of the items. That data sometimes goes up as high as top secret. If we lift an item out of that report and it is a classified item, then we would have to give it the appropriate classification,

Mr. POLAND. Is that classification almost paragraph by paragraph or page by page?

Mr. Blair. That is right. Let me explain.

I have here a classified document on Offshore Procurement. Eucom issues status reports on that and the entire document is classified "Confidential.” They put an overall classification on it, but they will indicate with respect to a particular item whether or not it is classified. In this particular report, everything is classified but I have seen others where the overall report will bear a security classification, but individual paragraphs are unclassified.

Mr. POLAND. It specifies on each page of that report the classification?

Mr. BLAIR. They signify the status of the security information on each page. If we took anything out of this particular page, we would have to classify it confidential because the entire page is so classified. If it were a paragraph that had classified information on problems under review and we lifted that, we cite the source, and classify it.

The military will signify on their reports not only the overall classification but the individual classification by page or paragraph.

Mr. POLAND. For the purpose of the record, would you please state what your practice is with respect to submission to the Defense Department of your draft before it becomes final! That is, on the

? security question.

Mr. Blair. For instance, on the military-assistance program, we issued a report on the examination of each country, and we asked them to review the security classification that we followed. We wanted their opinion as to whether or not we classified it properly, or whether it could be declassified. It so happened that in no instance did they declassify a report, and in one instance they upgraded the classification, because we had taken a number of confidential items, put them together in one document, and made it secret.

Mr. Poland. Is that submission relatively uniform on your part?

Mr. Blair. Yes, because we make an effort to issue reports that are not classified, for the reason that any classified material we handle is thereby automatically restricted. If we can get the point over without sacrificing anything, we will issue an unclassified report.

Mr. POLAND. In the last analysis, the agency that you are examining

, determines the degree of classification of your own report on that agency?

Mr. Blair. No, sir; not in that sense, Mr. Poland, but in the sense that they reexamine their own classification. That is the way I would explain it.

Mr. FasCELL. You ask them to do it?
Mr. BLAIR. Yes.

Mr. FASCELL. You submit the draft report and ask them to examine their own report?

Mr. BLAIR. Yes. Under their own rules and regulations, they are asked to reexamine the document for the purpose of declassifying.

Mr. POLAND. Under the security order, you are ordered to accept the classification they impose ?

Mr. BLAIR. That is right. Under the security order and Comptroller General orders issued following the President's order. We have no choice. In other words, it is up to the departmental Secretary to declassify.

Mr. MONTGOMERY. Have you ever noticed any inconsistencies in the classification as between the three departments in the military; that is, between the three military services ?

Mr. Blair. I cannot recall, Mr. Montgomery, any specific instance of that type. In other words, to compare like information from the three services, I cannot recall any specific instance.

Mr. FASCELL. Let me ask you this question then: Do you recall any specific instance where on your request for declassification the military declassified ?

Mr. BLAIR. Yes. In my examinations at home in the stockpile program,

Mr. FASCELL. I am trying to limit it with respect to this particular operation; that is, the General Accounting Office European Branch.

Mr. ROSENBERGER. I can definitely recall one instance, Mr. Chairman. It was in connection with OSP Ordnance, Sandhofen, Germany, report EU-135 series, wherein we pointed out that in our opinion, this did not appear to be a matter that concerned the security of the United States and yet we classified it secret because some documents

Mr. FASCELL. You asked them to review it, and they declassified it? Mr. ROSENBERGER. They sent us a cable the next day to declassify. Mr. FASCELL. That is encouraging.

Mr. BLAIR. In response to Mr. Montgomery's question, here is an example where in March of this year we pointed out to the Defense Department representative that some of the report pages concerning our military-assistance program examination had been classified secret and the remainder confidential. However, during our review we noted differences in security classification. The Navy program submission in many cases was classified lower than the Army and the Air Force submissions. “Consequently, it will be appreciated,” we said, “if you would have the security classifications shown on the draft report reviewed for propriety and possible declassification."

Mr. FASCELL. That is on the last report submitted on the militaryassistance program, survey and individual countries?

Mr. BLAIR. That was with respect to one country. We were submitting this one on Spain and, actually, they came back and upgraded it because we pulled together confidential data and they considered

Mr. FASCELL. What is the classification, then, on the military-assistance program report dealing with Spain?


Mr. FASCELL. What is the classification on these other militaryassistance country reports !

Mr. Blair. They are secret, and there is one top secret.

Mr. ROSENBERGER. Not the report proper. The report on Italy is secret, but we received some information from Washington in transmittal that made it top secret.

Mr. FASCELL. The transmittal letter to you made the whole thing top secret?

Mr. May. I think it would be well for the record to review the various classifications of material. Confidential is your top classified item, and then you go up to secret and then top secret?

Mr. ROSENBERGER. Confidential is the lowest.

Mr. May. I thought you said confidential was the highest. That is why I was confused.

Mr. FASCELL. The highest is top secret; is it not?
Mr. BLAIR. Yes.
Mr. FASCELL. And then secret?
Mr. BLAIR. Right.
Mr. FASCELL. Confidential being the lowest classification?

Mr. BLAIR. That is right. This particular report contained information both confidential and secret in nature. We said that it appeared to us that there was a difference in the classifications being used in the submission of the programs with respect to the services. For example, the Navy program submission in many cases was classified lower

than the Army and the Air Force submissions. It is not in exact response to Mr. Montgomery's question, because their information would be different.

Mr. FASCELL. It is close enough.

Mr. HUNTER. In answer to Mr. Carlson's question, whether we may take one item out of a classified document without checking back to see whether it was unclassified, let us take the case of the report on Spanish taxes, where the notes of negotiations were classified and the sections we used were not classified. Mr. Coons happened to be there at that time, and I asked him to check on that, and the net result was that we were able to use nonclassified sections out of a classified document so we could issue a nonclassified document.

Mr. FASCELL. That is very encouraging to me and I am sure, also to the other members of the subcommittee; that the General Accounting Office would undertake on its own to push the problem of declassifying material and making it available. It is a tremendous problem governmentwise, and I am very happy to see that this much interest has been taken by this Branch. While you have plenty to do, we hope you will continue in that effort.

Mr. BLAIR. I would like to point out that we continue to do that.

Mr. FASCELL. Let us go back to page 50 of this report on reports which have been submitted to congressional committees. You list six of them as of May 31, 1957.

Do I understand that you would have additions to this list since May 31 ?


You have submitted additional reports to congressional committees since then?

Mr. BLAIR. Let me point out, Mr. Chairman, that this is what Washington has done. In other words, we submít all of our reports to Washington. We do not issue reports ourselves. Whether Washington has issued reports to the Congress since this date, I would not know.

Mr. FASCELL. You mean to tell me that
Mr. BLAIR. The military assistance reports.

Mr. FASCELL. In other words, you do know that the home office of the General Accounting Office has issued other reports to committees of Congress and one of them being the worldwide report on the military assistance program. That is one of them, as well as all of the specific country reports to date, is that not true!

Mr. BLAIR. Yes.

Mr. FASCELL. The worldwide summary report is not classified but the specific country reports are classified ?

Mr. BLAIR. You could consider those as classified appendixes to the overall report. What we are trying to get out is something that can be used freely. We have followed that procedure here where we issued this overall report which is unclassified and these classified appendixes which are the individual country reports. They are backup data to the overall reports.

Mr. FASCELL. What countries have been reported on? Is that unclassified ?

Mr. BLAIR. I do not think that would be classified. In reading this report, was there any reference to the specific countries?

Mr. Conrardy. No reference was made in the overall report to specific countries. When a specific reference was made it mentioned countries or country. All of the detail is contained in the country reports.

Mr. BLAIR. I do know this: When the Comptroller General made the statement before the Foreign Affairs Committee, I reviewed his statement-he did not mention the country. I remember when he gave his overall statement he mentioned specific findings but he did not identify the country to which that statement related.

Mr. FASCELL. I do not desire to relate it to any particular country, but certainly the overall report should relate to X number of countries. Otherwise, we do not know what we are talking about.

Mr. CONRARDY. The countries that we reviewed are enumerated under the Scope of Review Section.

Mr. FASCELL. What I am getting at is this: Is that on page 20 of the overall report? That is, the Scope of Review Section? Is that what you have reference to! ?


Mr. FASCELL. That still does not answer my question. It says that you visited all of the countries. That does not mean anything to me.

I would expect you to visit all of the countries, but I am trying to find out what you reported on.

Mr. BLAIR. We visited six countries. We visited Spain, Germany, Pakistan, Turkey, Italy, and France.

Mr. FASCELL. You have more to go, is that the idea?

Mr. BLAIR. We will be initiating studies at the end of this month in two additional countries. In other words, the office is continuing its program. This program is directed from Washington. We have been asked to go to two other countries this year. We will start that examination the middle or the end of this month.

Mr. FASCELL. Before I go too far into this thing, I want to settle that, but did you have some other questions?

Mr. MONTGOMERY. What work had been done by the branch prior to these current country reports on the military aid program?

Mr. BLAIR. We have done work from the time the office was set up. We worked in France and we had done work in Great Britain, Turkey, and Italy before this overall program was initiated at home. I would like to point out that the countries I named are not all inclusive because our Tokyo branch examined certain countries out in the Far East. That is a partial listing covering the area of our responsibility.

Mr. MONTGOMERY. Is there any particular reason you would know of why this area had not been gotten into more generally before? That is, before these current reports?

Mr. BLAIR. We examined four countries and submitted information to Washington. I will

be guessing on this, but it would appear to me that the Comptroller General and his top staff back in Washington recognized it as a major problem area that Congress was most interested in.

Mr. MONTGOMERY. It has been one of the biggest money areas from the very beginning?

Mr. BLAIR. That is right.

Mr. MONTGOMERY. That program was actually initiated about 1952, was it not?

Mr. BLAIR. That is right. We got into it when the Branch was set up.

Mr. FASCELL. Focusing attention on this whole problem?

Mr. Blair. That is right. It became a matter of prime concern to the Congress. It is our desire to present to the Congress an objective study of the program.

Mr. FASCELL. I must say that you certainly selected a very worthwhile area from the standpoint of interest and possibility of improvement. All of us are certainly interested in national security and understand all of the attendant problems, but there would be no excuse for the things that I have read in the overall summary that are unclassified and that are wrong with the military assistance program that this branch has determined. I want to get into those specific things. Frankly, it was shocking to me to read that in a program which has been sold to the American people as one of inextricably being tied to our own defense, that we would have a complete separation of force objectives in the expenditure of money. It just does not make sense to me and then to go on and find out that there was no separation between political and military motives does not make sense to me. I am very pleased that these things have been brought out.

I am still for the program. I realize that it is necessary, but it certainly does not mean that I should be less critical of it. That is the spirit in which I read the General Accounting Office report on what they have done. I think it is a very healthy thing that this report has been brought out, and I hope that the others follow shortly.

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