Transcript of YouTube Video
The history of the CIA begins where much of modern history does—during the Second World War. Surprisingly, the United States did not have a dedicated intelligence agency before this time. Domestic intelligence was managed by the FBI, much as it is today, though the bureau itself had only been founded in the early 20th century. It was led by its first and long-serving director, J. Edgar Hoover. Meanwhile, foreign intelligence was largely handled by the State Department and the Department of Defense.
Before World War II, the entirety of U.S. intelligence capabilities could be found in a few scattered filing cabinets at the State Department. This would change dramatically during the war, especially after the United States was caught off guard by the surprise Japanese attack on Pearl Harbor in Hawaii in 1941. The attack necessitated a decisive response from President Roosevelt, who created the Office of Strategic Services, or OSS for short. This seemingly innocuous agency was tasked with overseeing all intelligence and covert operations during World War II. This development is a critical turning point in U.S. intelligence history.
Let’s take a moment to note something about the Office of Strategic Services (OSS). On the surface, the name sounds quite benign—this was intentional. Throughout its history, the CIA has frequently employed similar tactics, giving operations and departments innocuous-sounding names to obscure their more sinister undertones from the public.
Now, let’s dive into the history of the OSS and how it evolved into the CIA we know today. Before we get into the detailed history, let’s lay out a few key points. One overarching theme that will be explored throughout this series is the role of the CIA as a critical component of what can be seen as a parallel shadow government.
Beside the elected government of the United States, there exists what some refer to as a “deep state.” Before diving deeper, let me acknowledge that this term has become highly codified in recent years, often used by the American right—particularly since the rise of Trump and the growth of right-wing populism. This shift has muddied the waters, complicating serious discussions about the concept of a deep state within a country.
It’s important to note that the United States is not unique in this regard. Almost every democratic capitalist country can be observed to have a form of deep state. Let’s delve into the explanation and theory behind it.
The theory of deep states and deep politics was developed by Peter Dale Scott. According to his theory, the United States has a visible, elected government—the House of Representatives, the Senate, and the Presidency. However, behind this overt government lies a largely unelected, unaccountable, and often reactionary wing that functions as a guardian of elite interests and corporate profits. This entity is what is commonly referred to as the “deep state.”
The term “deep state” has been co-opted by right-wing conspiracy theories, often used to denounce any government actors they oppose. For the purposes of this series, we’ll use the term “deep state” to refer specifically to unelected officials who work to undermine the democratic will of the people. While much of the focus will be on the United States, we’ll also explore the impact of the CIA on other countries throughout its history.
By this definition, the deep state, as examined in this series, will include—among other entities—a key player: the Department of Defense.
This primarily includes the Pentagon and the Joint Chiefs of Staff, but it also extends to what is often referred to as the “security state.” This encompasses the Department of Homeland Security and various other affiliated departments. For example, the Department of Defense has its own intelligence unit, as do the Air Force and the Navy. Together, these components form the broader security state.
The deep state also includes the FBI, which functions as a domestic counterpart to the CIA. Additionally, it encompasses the defense industry—what is often referred to as the military-industrial complex. This includes all U.S. industries involved in producing weapons, arms, and military technology, which have played and will continue to play a significant role in American governance.
Furthermore, industries with indirect links to the military—such as the oil and fossil fuel sectors—are also part of this network. Think tanks, institutions like NATO, and other international organizations similarly contribute to and reinforce this structure, further solidifying its influence.
The deep state also includes elements of organized crime, such as the Mafia—not only in the United States but worldwide. It may also involve church institutions like the Vatican, which will play a significant role in the history of Operation Gladio, a topic we’ll address shortly. And, of course, at the heart of this deep state network lies the CIA.
It’s important to clarify that these institutions are not always explicitly working together. We’re discussing a wide range of organizations here, and it’s natural to approach this idea with skepticism. It’s not about every member or entity actively colluding in a coordinated effort to advance shared goals.
However, what cannot be denied is that these groups share common interests: the preservation of capital, the maintenance of U.S. global dominance, and a staunch commitment to anti-communism. These shared interests often align their actions, even if collaboration isn’t always deliberate or direct.
These three central tenets come together across these institutions to form what might be described as a “blob”—a deep state, or a network of organizations working in unison to advance these goals. At the core of this network is the CIA, and arguably, the broader security state.
As is typical of such deep institutions, the OSS—much like its successor, the CIA—was not established as a standard military entity. Instead, it was quickly populated by members of the elite ruling class. This pattern, which will be explored throughout this series, is not unique to the CIA but extends across the entire deep state network.
What stands out is that most of the individuals involved are far from ordinary citizens like you and me. Instead, they are drawn from the upper echelons of society—people with backgrounds in elite circles, such as Wall Street. This dynamic is a recurring theme in the history of the deep state.
The ranks of the early CIA and the OSS were filled with individuals such as bankers, lawyers, business executives, and former generals. These were not average U.S. soldiers but members of America’s elite class. With that in mind, let’s begin with the first director of the Office of Strategic Services: William Donovan, better known by his nickname, “Wild Bill.”
Donovan earned the nickname “Wild Bill” from the baseball player Wild Bill Donovan, who coached the Yankees between 1915 and 1917. However, William Donovan himself is most notable for his service as a World War I hero and as a self-made millionaire Wall Street lawyer.
During World War I, Donovan served as the U.S. Coordinator of Information, an early intelligence role within the Department of Defense. This experience likely made him a top candidate for Franklin D. Roosevelt when the president created the OSS in 1942. Donovan’s intelligence background and leadership made him a natural choice to serve as its director.
In the history of American intelligence, William Donovan was largely overshadowed by his subordinates, particularly a man named Allen Dulles, who will feature prominently in the early parts of this series. As the director of the OSS, Donovan served as a coordinator, ensuring that his agents undertook successful missions. Perhaps most importantly, his military credentials provided a vital cover for the OSS and the future CIA. Donovan was widely perceived as a respectable and dignified figure by the security establishment, which was key to legitimizing the agency.
This legitimacy was especially crucial because the OSS and, later, the CIA were often scrutinized by the broader security state, which saw them as potential rivals for control. Donovan’s status as a former military hero lent the OSS an air of authority and respectability in its formative years.
However, despite his reputation as an “honorable man” at the time, most accounts of Donovan depict him as a blunderer who struggled to achieve consistent success in his exploits. His performance fell short of the future achievements of the CIA. For example, a 1945 report written by Colonel Park about the OSS highlighted its shortcomings under Donovan’s leadership. This critique reflects the mixed legacy of Donovan’s tenure.
This report was presented to President Truman as he considered creating a new spy agency. Donovan was portrayed as a heavy drinker who hired not based on merit but through the so-called “old boy network” of Wall Street connections. This critique is especially striking given how deeply elitism was—and still is—ingrained in the OSS.
One glaring example of Donovan’s mismanagement is a notorious incident in Romania. During a visit, he left a briefcase containing critical OSS intelligence in a brothel, where it was later intercepted by Gestapo agents. The report also highlighted that Donovan frequently forgot about agents he had sent abroad. For instance, an OSS agent was stranded in Liberia due to his neglect. In another blunder, Donovan mistakenly ordered the bombing of OSS agents in France.
Ultimately, Donovan’s missteps led to his dismissal by Truman, who replaced him with Roscoe Hillenkoetter, a U.S. Naval officer, as the first director of the newly created CIA. This marked a significant turning point in the evolution of American intelligence.
At the end of the day, President Truman lacked faith in Donovan, who proved to be an ineffective leader in the realm of intelligence. Truman seemed to find more respect and dignity in appointing an active-duty military officer. However, as we’ll see later, Roscoe Hillenkoetter, while a more disciplined choice, was far from a saint himself and had his own devious tendencies.
This brings us to another critical theme and recurring subject in U.S. intelligence: the idea that once you’re part of the CIA, you never truly leave. Whether you retire or are discharged, the influence and connections forged within the agency tend to linger, shaping careers and decisions well beyond official tenure. This dynamic is a significant thread in the story of U.S. intelligence.
Many of these agents remained deeply involved in intelligence work, and Donovan was no exception. Officially, he returned to public life after the war, resuming his law practice. However, he continued to play a behind-the-scenes role, serving as an adviser to Allen Dulles during Dulles’s tenure as CIA Director. Donovan was also involved in several landmark operations, maintaining his influence within the intelligence community.
To wrap up on Donovan, while he may seem relatively irrelevant to the larger history of the CIA, he played a foundational role. As the anchor that brought together the agents of the OSS, he helped lay the groundwork for the CIA. Many of these OSS agents went on to shape the original charter and early identity of the agency.
Many of the CIA’s most notable—and criminal—acts occurred under the control of these original figures. In this sense, Donovan can be seen as the godfather of modern American intelligence.
Even if you haven’t delved deeply into CIA history, you’ve likely heard the name Allen Dulles. He is arguably one of the most important—and controversial—figures in modern American history.
Allen Dulles is frequently discussed, often in glowing op-eds that, in my view, are quite shameful. He was, without a doubt, one of the most reprehensible figures in American history—but also one of the most influential.
In this next section, which will likely comprise the majority of this part, we will delve into Allen Dulles’s career at the OSS. We’ll explore how he became a spy, his rise within the intelligence community, and how he will become a central figure in the episodes to come.
In the future, Allen Dulles would become the first civilian director of the CIA—a position from which he would wield immense influence over American history. Before diving into his story, I want to leave a final note: much of the background information about Dulles comes from a fantastic book by David Talbot, The Devil’s Chessboard.
This book holds a special place for me, as it rekindled my love for reading after a long hiatus. It’s an excellent resource for anyone interested in the topics discussed here, as much of my information is sourced from it. Talbot is an incredible author, and his work is highly readable. I can’t recommend The Devil’s Chessboard enough.
Now, let’s talk about Allen Dulles.
Allen Dulles was deeply entrenched in the upper echelons of the American elite. His maternal grandfather, John W. Foster, served as Secretary of State under President Benjamin Harrison, and his uncle by marriage was Woodrow Wilson’s Secretary of State. These connections tied Dulles closely to American government and democracy. He himself hailed from one of the preeminent East Coast families of lawyers and Wall Street financiers.
Born in Watertown, New York, Dulles graduated from Princeton University and later earned his law degree from George Washington University. Before the war, he worked as a lawyer at the prestigious Wall Street law firm Sullivan & Cromwell, where his brother, John Foster Dulles—who would later become Secretary of State under President Eisenhower—was a partner. These early connections and experiences laid the foundation for Allen Dulles’s influential career.
It’s crucial to recognize the significant conflict of interest between Allen Dulles’s work at Sullivan & Cromwell and his duties as an OSS agent. To elaborate, Sullivan & Cromwell’s client list included several firms closely tied to the Nazi regime. Among these was IG Farben, the company that manufactured Zyklon B gas, used in Nazi gas chambers. Another notable client was Krupp AG, a German arms manufacturer, along with many other infamous firms.
This places Dulles in a precarious position, caught between two worlds. On one side, he worked for the OSS, an agency tasked with supporting the Allied war effort and combating the Axis powers. On the other, his ties to Sullivan & Cromwell connected him to firms that profited from their associations with the Nazi regime. This duality raises important questions about loyalty, ethics, and the conflicting interests at play during his tenure.
Dulles’s position created a significant ethical conflict. As an OSS agent, he took orders mostly directly from President Roosevelt, who was focused on defeating the Nazis. At the same time, Sullivan & Cromwell represented clients like IG Farben and Krupp AG—companies either fully aligned with the Nazi regime or affiliated with the Third Reich. This dual allegiance inevitably influenced Dulles’s decision-making and some of the operations the OSS carried out.
Dulles’s résumé extends beyond his OSS work. In 1927, he was elected President of the Council on Foreign Relations, an influential conservative organization composed of business elites, bankers, industrialists, high-ranking government officials, and former military leaders. This role further solidified his position within the American power structure, blending government and corporate interests in a way that would define much of his career.
According to the organization’s mandate, their mission is to promote interventionism to “make the world safe for democracy.” This philosophy aligned closely with Allen Dulles’s worldview. With access to the OSS—one of the most powerful operating agencies in the world capable of orchestrating interventions—Dulles used his position on the Council on Foreign Relations as a platform to shape and influence others toward his vision of America’s future. His “firebrand” approach to interventionism left a lasting mark on U.S. foreign policy and the operations of the intelligence community.
At a 1946 Council on Foreign Relations meeting, held shortly after the war, Allen Dulles stated that the United States should not go too far in its efforts to cleanse Germany of its Nazi past, because, as he put it, “most men of the caliber required to run the new Germany suffer a political taint”—meaning they were Nazis. This statement further entrenched Dulles as a clear Nazi sympathizer, a pattern that persisted throughout his career. We’ll provide more examples of this as we continue.
Before diving into Dulles’s exploits during World War II with the OSS, it’s important to discuss the German chemical conglomerate IG Farben, a key client of Sullivan & Cromwell. This relationship underscores the deeper connections between Dulles and Nazi-linked interests, shedding more light on his priorities and allegiances during this period. Let’s explore this connection further before moving on.
During the Second World War, Allen Dulles’s sympathies likely leaned toward the Nazis, as evidenced by his connections to IG Farben. IG Farben was one of the pillars of the Third Reich’s industrial base. Formed in the 1920s as a conglomerate of several top German chemical and pharmaceutical companies, it became a massive enterprise—arguably the largest in Germany at the time. This near-monopoly included all the major chemical producers in the country and was a cornerstone of the Nazi economy.
IG Farben supplied essential resources, such as synthetic fuel, for which it held key patents at the time. During the rise of Nazism, the Reich itself supported IG Farben by providing price guarantees and purchasing a 5% equity stake in the company. This funding enabled IG Farben to significantly increase its synthetic fuel production capacity, making it a critical component of the Nazi war machine. In this context, we’re talking about a literal partnership between a corporate giant and a totalitarian regime.
State control of IG Farben meant a direct link between the company and the Nazi Party. And who provided its legal representation? The Dulles brothers.
With that in mind, it’s important to note that IG Farben produced a substantial share of the synthetic fuel that powered the Nazi war machine. Unlike other nations, the Nazis lacked access to large natural oil reserves, making them heavily reliant on the synthetic fuel produced by IG Farben. This placed the company at the very heart of the Reich’s military operations.
IG Farben is not the only sinister corporation the Dulles brothers represented at Sullivan & Cromwell, but it stands out as the cornerstone of their complicity in enabling Nazi terror. Their association with such a pivotal company underscores the troubling overlap between corporate interests and the atrocities of the Third Reich.
It’s important to note that intelligence agents drawn from Wall Street circles often never stopped serving their former clients. This dynamic resembles a revolving door, a metaphor frequently used to describe the movement of individuals between the private sector, intelligence agencies, or the Pentagon, while maintaining loyalties to their former clients.
It’s almost inevitable. Many of these individuals remain shareholders or maintain close personal relationships with members of corporate boards, making it natural for their sympathies to align with those interests. The Dulles brothers were no exception. They understood that the war would eventually end, and Allen Dulles, in particular, likely anticipated the possibility of returning to Sullivan & Cromwell.
To ensure the continued success of the firm—and by extension, their own influence—it made sense for them to maintain ties with key clients, including IG Farben, even if it meant indirectly serving the interests of the Nazi regime. This conflict of interest underscores the deep entanglement between corporate elites and U.S. intelligence during this period.
With that being said, the revolving door was clearly in effect with Allen Dulles. He continued to serve his clients and, as we’ll see, defied the orders of the President of the United States and the State Department at every turn when it came to working with the Nazis. To really drive home the depth of this Nazi connection, I’d like to share one more anecdote that highlights just how cynical, calculating, and inhumane these individuals were.
Both Allen Dulles, as an OSS agent, and John Foster Dulles, as a Sullivan & Cromwell law partner, had personal ties to the Nazis. In 1933, Allen Dulles met with Adolf Hitler during a diplomatic mission for the State Department. During this time, Dulles wrote letters and corresponded with his State Department colleagues, expressing curiosity and interest in the rising fascist party.
He saw potential business opportunities with Nazi Germany and was particularly taken with Joseph Goebbels, the Nazi propagandist who orchestrated the Reich’s anti-Semitic media empire. This admiration underscores the morally bankrupt pragmatism of Dulles, whose calculated actions reveal a willingness to overlook atrocities in favor of personal and professional gains.
Despite all his reprehensible qualities, Allen Dulles once remarked that he admired Joseph Goebbels for his “frankness and sincerity”—a chilling observation, to say the least. His elder brother, John Foster Dulles, was arguably an even more open Nazi sympathizer. He insisted that all correspondence from Sullivan & Cromwell to their German clients be signed off with “Heil Hitler.” Even into the mid-1960s, John Foster Dulles publicly expressed admiration for Nazism, making it clear that their sympathies ran far deeper than a simple desire to serve their clients.
The Dulles brothers saw serious potential in Nazi Germany, not just from a business perspective but also from a geopolitical standpoint. This is an important point to emphasize because it resurfaces repeatedly in the history of U.S. intelligence—particularly in the CIA’s ongoing support of fascist governments worldwide.
This brings us to another key tenet of the U.S. intelligence network: rabid anti-communism. This ideology was ingrained in the institution from its inception, as most of its founding members were part of the American ruling elite, who had a vested interest in maintaining the capitalist world order. The Dulles brothers exemplified this mindset. Broadly speaking, American anti-communists saw Nazi Germany as a useful counterbalance to communism in Europe, aligning their interests with those of the fascist regime—despite its atrocities.
Because of their vehement anti-communist stance, the Nazis were seen by many, including the Dulles brothers, as a bulwark against the Soviet Union. The Nazis’ belief in private property aligned closely with the interests of elites like the Dulles brothers. Additionally, the Nazi policy of re-privatizing businesses often restored seized property to its former owners—particularly property taken from Jewish people.
Anti-communist elites, including the leaders of the OSS, viewed the Nazis as workable allies against communism in Europe. As a result, the OSS—and later the CIA—frequently allied with, armed, and funded fascists to combat the Soviet Union and other socialist states. This approach gave rise to numerous alliances between the OSS and high-ranking Nazi officials.
One of the more troubling outcomes of this collaboration was the creation of what are known as “stay-behind organizations.” These underground groups, often composed of former Nazis or Nazi sympathizers, were armed and funded by Western intelligence agencies to remain in Europe as a counterforce to communist influence. These covert networks would play a significant role in post-war geopolitics, underscoring the moral compromises made in the name of anti-communism.
We’ll delve deeper into this later, but for now, it’s clear that the OSS was largely ineffective at infiltrating and sabotaging the Nazi regime during the war. They failed to provide useful intelligence on enemy troop movements or activities. While some of this could be attributed to incompetence—Wild Bill Donovan was widely regarded as ineffective—I would argue that it was also due to a lack of genuine effort, stemming from the Nazi sympathies held by many high-ranking OSS agents.
What’s undeniable is that the OSS’s main “successes”—if you can call them that—came near the end of the war and often involved collaboration with Nazi officials. These activities, far from being victories for anti-fascists, laid the groundwork for future CIA operations throughout Europe. The OSS’s actions during this time aimed to circumvent European democracy to ensure that communists, or even left-leaning governments, would never come to power in Western Europe.
In the next part, we’ll cover Operation Sunset, Allen Dulles’s harebrained scheme to broker a separate peace with Nazi Germany and to ensure the survival of the Nazi Reich post-war.