BRIAN TOOHEY. The man who thought he owned a Prime Minister

Sep 6, 2019

‘This is the gravest risk to the nation’s security there has ever been.’Sir Arthur Tange, 6 November 19751.   Prime Minister Gough Whitlam, the son of a former solicitor-general, was initially attracted to the notion that Arthur Tange was a dedicated public servant. He later discovered that this public servant presumed he was entitled to withhold crucial information from prime ministers.

Tange was an abrasive personality who headed the Foreign Affairs and Defence departments for twenty years, broken only by a demotion to high commissioner to India after he fell out of favour with Prime Minister Robert Menzies. After he returned to head Defence in 1970, he quickly demonstrated that he hadn’t lost his love of wielding power. He embraced Labor’s proposal to incorporate five separate departments into a vastly enlarged Defence Department—a process that increased his own power without generating the anticipated efficiency gains—but he never fitted the stereotype of a ‘hawk’ eager to use military force.

His preoccupation with rigid secrecy and the control it gave him came to a head in November 1975, a month after the Opposition leader, Malcolm Fraser, announced that the Coalition would, in effect, block the budget supply bills in the Senate to bring Whitlam down. Tange became deeply alarmed at what he saw as Whitlam’s willingness, in the heat of a political battle, to challenge his control over what ministers could say about the US’s prize asset in Australia, Pine Gap.

Tange’s alarm stemmed from information I received in mid-1975 about the role of Richard Stallings, who was Pine Gap’s first head when it was established in the mid-1960s. Because Tange had not told Whitlam that the CIA ran Pine Gap, he was desperate to hide the fact that Stallings had worked for the agency when he was running Pine Gap. After Labor staff independently found out from Adelaide sources where Stallings had worked, Whitlam asked Foreign Affairs on 20 October 1975 for a list of all CIA officials in Australia for the past ten years—information he was fully entitled to have and that the US was supposed to give Foreign Affairs.

Stallings’ name was not on the list, and ASIO also said it had not heard of him. Whitlam then told his department head, John Menadue, to ask Tange about Stallings. Tange told the PM’s staff that he had informed the CIA of Whitlam’s request. Whitlam told parliament on 4 May 1977 that ‘after some pressure’ Tange had confirmed that the CIA had employed Stallings at Pine Gap during 1966–69 and that he had spent part of his time from 1971 to 1974 in South Australia, where he performed ‘CIA service at Willunga’, outside Adelaide. A former highly placed CIA official, Victor Marchetti, was a friend of Stallings who had helped him draft the secret version of the Pine Gap agreement, which stated that it would be run by the CIA and the Australian Defence Department. On retiring, Marchetti co-authored The CIA and the Cult of Intelligence, a powerful analysis of the damaging mystique surrounding clandestine intelligence. He told me and other journalists in November 1975 that Stallings’ service at Willunga had been for the CIA’s covert action division, despite Stallings’ earlier qualms about its activities.

Marchetti also said Stallings told him that he was concerned in the 1960s that the then CIA station chief Ray Villemarette’s interference against Labor in Australian politics could jeopardise the continued presence of Pine Gap.

Based on US sources, I reported on 3 November 1975 that Stallings had worked for the CIA as head of Pine Gap, and gave more details the next day. The National Country Party leader, Doug Anthony, then told journalists that Stallings was a friend who had rented his Canberra house, and that his family and Stallings’ family had subsequently holidayed together. On 4 November, Anthony denied in parliament that he knew that Stallings worked for the CIA. Later that day, at Tange’s urging, Labor’s defence minister, Bill Morrison, tried to get Anthony to stop talking about Stallings. Refusing to be silenced, Anthony put a question on the parliament notice paper on 6 November challenging Whitlam to provide evidence when parliament resumed on 11 November that Stallings  worked for the CIA. Anthony referred to The Australian’s report earlier that day that the State Department said Stallings ‘had never worked for any US intelligence agency’.

Given that Whitlam knew this was a lie—because Tange had belatedly told him the truth—he refused to mislead parliament by saying Stallings had not been a CIA employee. Shortly after Anthony put his question on the notice paper, Whitlam prepared a reply making it clear that Defence (i.e. Tange) had recently told him that Stallings had worked for the CIA.

Later the same day, he read it over the phone to a horrified Tange, who then told Whitlam’s staff: ‘This is the gravest risk to the nation’s security there has ever been.’ Others might nominate the early days of the Pacific War as a more serious threat than confirmation of the public knowledge that someone worked for the CIA.

Under the agreement between Australia and the US, notice to terminate Pine Gap’s activities could have been given from 10 December Ted Shackley, the head of the CIA’s East Asia division, gave ASIO’s Washington representative a tough message on 8 November to send to ASIO headquarters. His telex to ASIO raised the possibility of cutting off the intelligence relationship unless ASIO gave him a satisfactory explanation of Whitlam’s comments on CIA activities in Australia, which could ‘blow the lid off’ Pine Gap. ASIO passed the message on to Tange on 9 November and to Whitlam on 10 November.

On the morning of 10 November, Tange and Farrands sent Whitlam a note claiming that later that day the Pentagon would ‘announce Stallings was employed by the US Department of Defense … This direct confrontation [with what Whitlam planned to say] must be avoided at all costs. Proposed formula for the answer to Anthony’s question is overtaken by the intention of the US.’ Tange should never have presumed he had the right to give the elected PM such a blunt order. The Pentagon made no announcement.

There was no reason for Whitlam to abandon his accurate answer based on what Tange had told Menadue earlier in the month. Shackley’s telex removed any residual doubt about where Stallings worked by bluntly stating: ‘Stallings is a retired CIA employee.’ This demonstrated that the State Department’s 6 November public denial was a straight-out lie, while the proposed Pentagon statement, if it ever existed, was little better. Even if Stallings had worked for the US Defense Department earlier in his career, Whitlam was correct to say that he was working for the CIA at Pine Gap. In the event, Kerr sacked Whitlam at 1 p.m. on 11 November 1975 and installed Fraser as caretaker prime minister, although Labor still had a majority in the House of Representatives. There was no urgency—supply would not have run out for another nineteen days. Although information about the CIA’s role in Pine Gap may have played no part in Kerr’s decision, it meant that Whitlam could not give his proposed answer to Anthony’s question. Much to Tange’s and Shackley’s annoyance, I reported the gist of the telex message eight days before the election on 13 December 1975.

Tange’s behaviour was reprehensible. A responsible public servant would not have behaved towards a prime minister in such an arrogant, unprofessional and bullying manner as he did about who ran Pine Gap. He should have replied immediately to the Pentagon urging it not to make any statement that clashed with Whitlam’s intention to give an accurate parliamentary answer stating the already publicly known fact that the CIA ran Pine Gap.

Whitlam’s refusal to take Tange’s advice threatened to undermine much of the power and control Tange had built as the undisputed keeper of the CIA’s secrets in Canberra. Other Defence heads and senior officials have not let an addiction to secrecy distract them from the many other important aspects of their jobs.

After the dismissal, former Labor defence minister Bill Morrison told me that Tange had claimed to him that the CIA’s role at Pine Gap had to be kept secret because it was part of an intense political battle in Washington over whether the CIA or the NSA should run the facility in future. Morrison, who never told me anything about Pine Gap while he was minister, said he couldn’t understand what Tange was on about. The key players in Washington knew who ran it, and Tange had no business taking the CIA’s side.

The NSA claimed a compromise victory in 1977 when the US government gave it ‘review and approval authority’ over the CIA’s signals intelligence programs. The NSA is now clearly in charge of this program, as the ABC reported in 2017. Moreover, US spy Christopher Boyce had already told the Soviets the answer to the minor puzzle of who ran the station. Nothing Whitlam proposed to say could have compared with what Boyce did as an employee of a CIA contractor deeply involved with Pine Gap. The US deputy secretary of defence at the time, William Clements, said, ‘Our intelligence community is in disarray. A major satellite intelligence system developed and deployed over the past decade without Soviet knowledge has been compromised by intelligence procedures as porous as Swiss cheese.’

Tange later refused to answer my written questions about what communications he had with the US about Whitlam’s behaviour, including the purported Pentagon announcement on 10 November that Stallings worked for it. Tange’s biographer, Peter Edwards, who had access to the Defence Department’s classified archival records, told me he did not recall seeing any of this material.

There was a further twist to Tange’s attempts to downplay his overbearing behaviour in the lead-up to 11 November 1975. In his memoir, he dismissed Shackley’s telex as unimportant. Others called it ‘one of the most dramatic cables in Australia’s political history’. Tange described Shackley as a ‘ham-fisted’ American intelligence official who ‘fired off ’ a telex to ASIO ‘extravagantly predicting serious consequences for Australia’s relations which could follow the Prime Minister’s disclosures’, but Shackley’s language was not as extravagant as Tange’s claim that Whitlam had committed the ‘gravest breach of security ever’. Shackley was relaxed about Tange. When we later met in Washington, the first thing he asked was ‘How’s the old crocodile?’

What can the NAA tell us about these historic events in November 1975? None of the communications between Defence and the Pentagon and the CIA leading up to 11 November are available in the archives.

This is not the NAA’s fault—Defence often ignores its legal obligation to provide records to the archives. The Attorney-General’s Department is little better. The NAA replied on 16 February 2016 to a request from me that it had identified a relevant document in records held in the Attorney-General’s Department, which the department had destroyed. The only message of interest from the US in the archives is the Shackley telex to ASIO, but its content was still totally redacted in 2016. I published the full text in the AFR on 29 April 1977—almost forty years earlier—and Whitlam read it into Hansard on 4 May 1977.

This is an extract, Chapter 20, from Brian Toohey’s new book, SECRET, the making of Australia’s security state. It is now widely available

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