June 21st 2008

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Articles from this issue:

EDITORIAL: 'Peak oil': Apocalypse now?

CANBERRA OBSERVED: Whither the Nationals?

ECONOMIC AFFAIRS: What happens after cheap credit, oil and food?

SAME-SEX RELATIONSHIPS: Rudd grants special rights to same-sex couples

FAMILY POLICY: Home truths about working families

EUTHANASIA: Assisted suicide: safeguards or naivety?

NATIONAL SECURITY: Soviet bloc espionage: setting the record straight

DEFENCE: Should Australia have nuclear defence capability?

CHINA: Beijing muzzles protests over Sichuan earthquake

UNITED STATES: Is Obama equipped to lead the free world?

CULTURE: How political correctness threatens Australian culture

ART: The downward spiral of modern art

Barack Obama's oratory (letter)

Why cutting Australian emissions won't work (letter)

Baby imports? (letter)

Short-term stupidity (letter)

CINEMA: New Narnian epic Prince Caspian surpasses expectations

BOOKS: INKLINGS OF HEAVEN: C.S. Lewis And Eschatology, by Sean Connolly

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Soviet bloc espionage: setting the record straight

by Warren Reed and Dr Christopher J. Ward

News Weekly, June 21, 2008
Australia's intelligence agencies and government departments were compromised by agents working for the Soviet Union, according to recently declassified papers from the Hope Royal Commission (1974-77). Warren Reed and Dr Christopher J. Ward report.

Australia today is devoid of a realistic capacity to cleanse itself in counter-espionage and counter-intelligence terms.*

The odd foreign spy, through bad tradecraft or due to nifty footwork on the part of Australian security officers, may well be identified. But when it comes to exposing and prosecuting those Australians who, having access to the nation's most closely guarded secrets have sold us out to such foreign operatives, forget it.


The culture of cover-up by senior bureaucrats and politicians on both sides in Canberra is so entrenched that the chances of our finding, let alone prosecuting and jailing, an Aldrich Ames or a Robert Hanssen are virtually non-existent. Ask any former Australian intelligence officer who's pushed for exposure and had his or her career ruined, and you'll know what that means.

This is one of our country's big untold stories, a mere glimpse of which came with the recent release by the National Archives of some of the papers of Australia's Royal Commission on Intelligence and Security (1974-77), headed by Justice Robert Hope. These provided the Australian public with a belated glimpse into the clandestine world. But little was said about treason, treachery and Australian traitors, and the media displayed no inclination to ask why that was so.

While the material revealed was truthful, it presented a very one-sided picture. Understandably, the media picked up on the image of "bumbling spies". And who wouldn't? To be sure, some security officers (who, incidentally, are not spies but spy-catchers) were indeed that, but their presence was obviously tolerated by a management that had no problem with bumbling.

Not mentioned were the men and women who worked hard at their job, keeping a sensible eye on the national interest and attempting to serve it. Nothing was reported about the success of their efforts, about who hindered them in bringing cases to a natural conclusion and why their complaints of obstruction went un-addressed.

In reality, many officers who quietly served in ASIO from its establishment in 1949 until the time of the Hope Royal Commission were war heroes and people of distinction. They believed implicitly in the job they were doing, which most saw as an extension of their wartime service. True, there were "Cold War warriors", but some were also ASIO staffers who had a much more realistic perspective on how to protect Australia.

One glaring omission in the media accounts of the release of the Hope records was the failure to examine the historical dimension of ASIO. There was an obligatory nod in the direction of the Petrov case, but, as usual, it was couched in terms of an alleged conspiracy between Prime Minister Robert Menzies and ASIO's second Director-General, Brigadier Sir Charles Spry to time the Petrov defection for political purposes and deny Labor what was expected to be a clear win in the May 1954 federal election.

The fact that the Petrov defection was a major coup for ASIO and its Western allies is conveniently ignored or deliberately downplayed.

Another was the failure to recognise that it was an ALP government that set up ASIO. The organisation's antagonists depict this act as one foisted upon Prime Minister Ben Chifley at the urging of the US and UK authorities.

Indeed, a significant thread of truth runs through this argument. The key Western powers were only too aware that Australia was leaking intelligence throughout World War II and, afterwards, a good portion of it supplied by the US and UK.

The existence of a Soviet spy ring in the then Department of External Affairs (DEA) led inevitably to a warning from our major allies for Australia to either put its house in order or be excluded from normal intelligence exchanges. It is conveniently forgotten that years before Labor set up ASIO in 1949, Churchill had made his famous Iron Curtain speech in Fulton, Missouri, in March 1946, when the battle lines of the Cold War had already more or less been drawn.
Dr H.V. Evatt

Under the circumstances, by 1949, the Chifley Government had no option but to establish ASIO, which it did under the leadership of a South Australian, Justice Geoffrey Reed. However, as Dr Andrew Campbell has shown from the recently declassified records of the Hope Royal Commission, the Secretary of DEA, Dr John Burton, was implacably opposed to the creation of a security service (Andrew Campbell, "Dr H.V. Evatt: the question of loyalty", National Observer, No. 76, Autumn 2008).

Prime Minister Chifley ignored the DEA. The succeeding Menzies administration went one step further and decided that the agency would be better headed by an intelligence professional, hence the appointment of Colonel (later Brigadier) Spry.

Spry was given a charter to run ASIO that, by the standards of the day, was quite wide-ranging. With the assistance of Britain's domestic security service MI5, ASIO was given a basic structure and security responsibilities, and received files from the Commonwealth Investigation Service and other related entities.

In the main, the material was a mess, much of it chaotically arranged and often based on nothing more than suspicion. The first large intake of ASIO officers, known for many years as the "49ers", worked at the organisation's headquarters in Sydney trying to bring order to the system. Veterans of that era referred to themselves as "salt-miners", and with some justification.

Lack of funding

The fact that the agency took well over 30 years to standardise and computerise its records system is partly an artefact of lack of funding, inferior technology, and a shortage of information management specialists, a profession then in its infancy.

But to return to ASIO's main task of catching foreign operatives on Australian soil, it is generally not understood that spies rarely seek direct access to secret material. They hardly ever break into safes in the dead of night. Rather, they recruit local citizens who have access in the course of their work and who can bring out documents or pick up information without arousing suspicion.

These people are traitors and their motives are mixed. Before and after World War II, ideology was often the basis for their actions, but this was rapidly superseded by greed. Here, ASIO's track record by any standard is abysmal - probably the worst among the Western democracies - and yet not for of want of trying on the part of loyal and alert officers in the organisation's ranks.

Indeed, Justice Hope's greatest fear seemed to be that ASIO itself was infested with traitors who were selling state secrets to the Soviets and perhaps also to others. But, regrettably, this was something he believed he had no licence to delve into.

Not revealed in the recent release was what sharper ASIO officers told him of what they knew about the organisation, other agencies and even government departments, and about how these bodies had been penetrated and by whom. Hope nevertheless articulated his fear of the impact such treachery would have on our allies.

This major shortcoming has never been properly addressed, to the extent that, a decade after Hope's investigation, things were again so bad that the US severed all intelligence flows to Australia until the government of the day agreed to take action.

An ABC television Four Corners investigation, "Trust and betrayal" (November 2, 2004), featured a very senior retired public servant once involved in overseeing ASIO who was prepared to talk for the first time - full face to camera - about the extent of Soviet penetration. He laid bare deficiencies of counter-intelligence and a top secret government probe in the mid-1990s into important revelations by Soviet intelligence defectors.

And yet nothing happened. The then Keating Labor Government, with the tacit assent of the Opposition, refused to comment (matters of national security, you understand), and not a murmur was heard in federal parliament.

Oddly, also in the same month, Hendropryono, the then retiring head of Indonesia's national intelligence organisation, BIN, talked openly on another Australian national television program about the extent of his country's penetration of the Canberra system. It was an extraordinary performance in which he alluded to Indonesia's recruitments of Australian politicians, bureaucrats and defence personnel.

Again, nothing happened and not a question came up in parliament.

Treachery is never a pleasant thing to uncover; but if it is not confronted and rooted out, it can haunt a nation for generations. In the short term, offenders can be paid off to slip away quietly, but the careers of those who exposed the crime can be destroyed. In the long-term, however, a compromised intelligence agency becomes ever more resourceful at escaping scrutiny. Should one big fish be caught and prosecuted, the blowback from the subsequent court case can be horrendous, revealing years if not decades of cover-up not only by those still living but also by those still in positions of great public trust.

Target of espionage

The very agencies that are meant to be the eyes and ears of the nation, and hence the target of foreign spies, become complicit in concealing the rottenness at their core that threatens every Australian's well-being.

This is the ultimate irony, and one that the late Justice Hope obviously worried about.

Unfortunately, the media, the universities and commentators of all shapes and hues failed to recognise the significance of the recent release. The few to be stirred by the event were unable to see past the bumbling and ended up committing the same act themselves. A definitive and unbiased history of the Australian intelligence agencies has yet to be written.

If Australia, a country rich in resources, wishes to keep a firm grip on its destiny in this part of the world, it is going to have to do much better than this. We must learn from the lessons of the past.

Meanwhile, don't listen for the whispered complaints of foreign spies. They're continuing to have a field day.

* Counter-espionage entails countering the activities of foreign intelligence officers on Australian soil, while counter-intelligence involves countering the penetration of our own intelligence agencies and the government.

- Warren Reed and Dr Christopher J. Ward have published articles on intelligence matters in National Observer.

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