Tech sabotage during the Cold War

An excerpt from a book by a high-ranking official in the Reagan administration

Thomas Reed watched the Cold War from a privileged perspective inside the White House as a member of President Reagan's National Security Council. His book, "At the Abyss: An Insider's History of the Cold War," contains seldom-publicized details of the intrigue and subterfuge employed to topple the Soviet Union.

In the book, Reed, also former secretary of the Air Force, raises the curtain on an incident in the early 1980s that demonstrated, in his opinion, the importance of American technological superiority in defeating the Soviets in the nuclear game that never turned hot.

"There are several lessons learned from the Cold War that count today," Reed said in a recent interview. "Number one is pay attention to what goes on overseas. Don't let the Hitlers and Stalins proliferate."

"Number two," he said, "is technology counts."

According to an unpublished document known as the Farewell dossier, the United States supplied the Soviet Union with faulty software that eventually led to a major pipeline disaster. Reed said such a ploy would never have been undertaken if the Soviet secret police, the KGB, had not been engaged in the theft of Western technology.

"The U.S. was not in the business of polluting

technology it sold abroad, but Farewell was about the Soviets stealing technology," he said.

"Once you get into that business, you pay the consequences."

Reed, who was not directly involved with the operation, said he understood the program to be widespread. In fact, when the Soviets discovered in 1985 just what had happened, they were left wondering what other systems were likely to fail as a result — they had no idea what technology was legitimate and what was bogus. But the Soviets couldn't complain without admitting to the Western world that they had been stealing the technology in the first place.

"It was the computer equivalent of the U-2," Reed said, referring

to the famous high-altitude planes the United States used to spy on the Soviets. "They knew we were using them but didn't dare complain to anyone about it because, until they shot down [Air

Force Capt. Francis Gary] Powers, doing so would admit they couldn't reach them

to shoot them

down."

The following is an excerpt from "At the Abyss: An Insider's History of the Cold War"

by Thomas Reed, a member of the National Security Council during the Reagan administration. The tale that follows is extracted and in some cases quotes from unpublished notes by Gus Weiss, one of Reed's associates at the NSC. Those notes are titled "The Farewell Dossier: Strategic Deception and Economic Warfare in the Cold War."

The Farewell dossier

There could be no clearer delineation between the Old Shoes and the Pragmatists than the matter of the Farewell dossier.

In the early 1970s, the Nixon administration put forth the idea of détente. Henry Kissinger's hopes were that "over time, trade and investment may leaven the autarkic tendency of the Soviet system." He believed that détente might "invite the gradual association of the Soviet economy with that of the world economy and thereby foster interdependence that adds an element of stability to the political relationship."

Leonid Brezhnev did not quite see it the same way. In 1972 he told a group of senior party officials: "We communists have to string along with the capitalists for a while. We need their credits, their agriculture and their technology. But we are going to continue massive military programs, and by the mid-1980s, we will be in a position to return to an aggressive foreign policy designed to gain the upper hand with the West."

Reagan was inclined to ignore Kissinger's theories of détente and to take Chairman Brezhnev at his word, but all doubt was swept away on July 19, 1981, when the new American president met with President François Mitterand of France at an economic summit meeting in Ottawa. In a side conversation, Mitterand told Reagan of his intelligence service's success in recruiting a KGB agent in Moscow Center. The man was part of a section evaluating the take from Soviet efforts to acquire, and if necessary steal, Western technology. The source, Colonel Vladimir I. Vetrov, was designated "Farewell" by the French Direction de la Surveillance du Territoire. He enjoyed an ideal port for viewing the work of the "Line X" collection apparatus within the KGB's Technology Directorate.

Reagan expressed great interest in Mitterand's sensitive revelations and was grateful for his offer to make the material available to the U.S. administration. The dossier, added to the "KUDO" intelligence compartment, arrived at the CIA in August 1981. It immediately caused a storm. The files were incredibly explicit. They set forth the extent of Soviet penetration into U.S. and other Western laboratories, factories and government agencies. They made clear that the Soviets had been running their research and development on the back of the West for years. Given the massive transfer of technology in radars, computers, machine tools and semiconductors from U.S. to USSR, the Pentagon had been in an arms race with itself.

The Farewell dossier also identified hundreds of case officers, agents in place and other supporters of information and parts throughout the West and Japan. During the early years of détente, the U.S. and the USSR had set up working groups in agriculture, civil aviation, nuclear energy, oceanography, computers and the environment. The purpose was to start the construction of "peaceful bridges" between the superpowers. Working group members were to exchange home-and-home visits. The Soviets thoroughly corrupted this process by inserting intelligence officers into those delegations dealing with technology of interest to them. Farewell made the extent of this subterfuge glaringly apparent. Even one of the Soviet cosmonauts, participating in the joint U.S./USSR Apollo/Soyuz space flight, was a KGB science officer.

Aside from agent identification, the most useful information in the Farewell dossier was the KGB's shopping list: its targets for technology acquisition and theft during the coming few years. When the Farewell dossier arrived in Washington, Reagan asked Director of Central Intelligence Bill Casey to come up with a clandestine operational use for the material.

During the fall of 1981, one of my National Security Council associates, Dr. Gus Weiss, was cleared to read the material. He devised a remarkable plan: "Why not help the Soviets with their shopping? Now that we know what they want, we can help them get it." There would be just one catch: The CIA would add "extra ingredients" to the software and hardware on the KGB's shopping list. Weiss presented the plan to Casey in December 1981, and Casey took it to the President in January 1982. Notably absent from the meeting were any of the White House's strong believers in détente.

Reagan received the plan enthusiastically; Casey was given a "go." There were no written memoranda reflecting that meeting, or for that matter, the whole project, for many in the intelligence community were concerned about the security of the new, computerized, internal NSC communication system.

Within a few months, the shipments began. The Weiss project targeted the Soviet military/industrial needs as set forth in the Farewell dossier. "Improved" — that is to say, erratic — computer chips were designed to pass quality-acceptance tests before entry into Soviet service. Only later would they sporadically fail, frazzling the nerves of harried users. Pseudosoftware disrupted factory output. Flawed but convincing ideas on stealth, attack aircraft and space defense made their way into Soviet ministries.

The production and transportation of oil and gas was at the top of the Soviet wish list. A new trans-Siberian pipeline was to deliver natural gas from the Urengoi gas field in Siberia across Kazakhstan, Russia and Eastern Europe, into the hard currency markets of the West. To automate the operation of valves, compressors and storage facilities in such an immense undertaking, the Soviets needed sophisticated control systems. They bought early model computers on the open market, but when Russian pipeline authorities approached the U.S. for the necessary software, they were turned down. Undaunted, the Soviets looked elsewhere; a KGB operative was sent to penetrate a Canadian software supplier in an attempt to steal the needed codes. U.S. intelligence, tipped by Farewell, responded and — in cooperation with some outraged Canadians — "improved" the software before sending it on.

Once in the Soviet Union, computers and software, working together, ran the pipeline beautifully — for a while. But that tranquility was deceptive. Buried in the stolen Canadian goods — the software operating this whole new pipeline system — was a Trojan horse. In order to disrupt the Soviet gas supply, its hard-currency earnings from the West and the internal Russian economy, the pipeline software that was to run the pumps, turbines and valves was programmed to go haywire, after a decent interval, to reset pump speeds and valve settings to produce pressures far beyond those acceptable to the pipeline joints and welds.

The result was the most monumental nonnuclear explosion and fire ever seen from space. At the White House, we received warning from our infrared satellites of some bizarre event in the middle of Soviet nowhere. NORAD feared a missile liftoff from a place where no rockets were known to be based. Or perhaps it was a detonation of a small nuclear device. The Air Force chief of intelligence rated it at 3 kilotons, but he was puzzled by the silence of the Vela satellites. They had detected no electromagnetic pulse, characteristic of nuclear detonations. Before these conflicting indicators could turn into an international crisis, Gus Weiss came down the hall to tell his fellow NSC staffers not to worry. It took him another 20 years to tell me why.

The Farewell countermeasures campaign was cold-eyed economic warfare, put in place to inflict a price on the Soviet Union for corrupting the lofty ideals of détente. While there were no physical casualties from the pipeline explosion, there was significant damage to the Soviet economy. Its ultimate bankruptcy, not a bloody battle or nuclear exchange, is what brought the Cold War to an end. In time, the Soviets came to understand that they had been stealing bogus technology, but now what were they to do? By implication, every cell of the Soviet technical leviathan might be infected. They had no way of knowing which equipment was sound, which was bogus. All was suspect, which was the intended endgame for the entire operation.

As a grand finale, in 1984-85 the U.S. and its NATO allies rolled up the entire Line X collection network, both in the U.S. and overseas. This effectively extinguished the KGB's technology-collection capabilities at a time when Moscow was being sandwiched between a failing economy on one hand and an American president — intent on prevailing and ending the Cold War — on the other.

Mikhail Gorbachev was infuriated at his agents' arrests and deportations, for he had no idea that American intelligence agencies had access to the Farewell dossier. At a meeting of the Politburo on October 22, 1986, called to debrief his associates on the Reykjavik summit, he ranted that the Americans were "acting very rudely and behaving like bandits." While presenting a soothing face in public, Gorbachev privately referred to Reagan as "a liar." During the final days of the Soviet Union, the general secretary of the Communist Party had to operate in the dark. Gorbachev had little idea of what was going on in the American laboratories and high-tech industries; he could not tell if, or how badly, his own had been corrupted.

Through all of this, the White House Pragmatists also remained in the dark. If Nancy Reagan, Chief of Staff Jim Baker or Assistant to the First Lady Mike Deaver had known that the U.S. government was blowing up Soviet pipelines, infiltrating Soviet computers, bollixing their software or spoofing electronic equipment — even though done with the president's approval — they would have had a fit. As it was, they remained ignorant while the president played his trump card: the Strategic Defense Initiative/Star Wars. He knew the Soviets could not compete in that league because he knew the Soviet electronics industry was infected with bugs, viruses and Trojan horses placed there by the U.S. intelligence community.

NEXT STORY: More smart card standards, please

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