REF ID:A66573e 

Package containing CONPIDEllTIAL documents. 

Mr. William F. Plliedman 

Naval Seourity Station 

~. A.d. 

eclassified and approved for release by NSA on 

5-02-2014 ursuantto E.O. 13526 

24-429 

6 December 1954 
... NATIONAL SECURITY AGENCY 

WASHINGTON 25, D. C. 

MEMORANDUM FOR THE MEMBERS OF THE UNITED STATES COMMUNICATIONS 

INTELLIGENCE BOARD AND THE MEMBERS OF THE UNITED STATES 

COMMUNICATIONS SECURITY BOARD 

SUBJECT: Implications of a Policy Which Would Permit Cryptographic 

Aid to Friendly Foreign Governments for their National 

Purposes 

The following statement repeats and expands the remarks made 

on the subject by the Director, National Security Agency at the 103~4 

USCIB meeting. 

1. Once the U. S. embarks on a program which permitG euppl~ 

of cryptographic materia~ or equipment to one friendly foreign 

govermnent it will be impossible to prevent extension of the program 

to all other friendly foreign governments. 

a. The u. s. cannot take the positipn ot showing preferential 

treatment in the cryptographic supply business by providing one friendly 

nation with cryptographic assistance and denying it to another. 

Politically, any attempt to do this would be disastrous. 

b. There is no way in which provision of such aid to one 

country could be kept a lasting secret from others. Requests for · aid from Brazil, say, favorably considered, would lead to similar 

requests from Chile, and there would be no way of denying the same 

aid to Chile. 

c. The overlapping network of military and political 

all.iances and assistance pacts in which the u. s. participates results 

in putting the U. s. in the position of being an expected source of 

aid to its allies in this field as well as in others. 

d. In swmnary, it could be stated that our cryptographic inf'ormati~n and material is kept in a Pandora's Box which once 

opened can never be closed. 

2. It follows that just as there can be no refusal of a request 

of one nation after approval of another's, there can be no discrimination in the type of aid provided. If, for example, a request for 

assistance from one country is met by the provision of machine "X", 

a similar request from another country cannot be filled by anything 

inferior to machine "X". 

SECRET 
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6:88HEl'i' Serfal: 00159-S 

3. In essence, once a start is made, it would become the 

policy of the U. S. to supply all comers, and there would be many. 

a. How much would this amount to? It is difficult to 

estimate but e fairly good guess can be' made. Assuming our friends 

to be all of the non-Communist countries there are about 55 nations, 

excluding NATO and the British Comr.1.onwealth, who might be expected to 

come to us for aid. If their requests could be filled by as little 

as a~.average of 100 machines, 5500 would be needed, and to this 

we would have to ad~ at least a minimum of 2000 for NATO nations, be~~ 

those for international military use already planned for. Accordingly, at least 1500 machines would be- required; Since cipher machine·a· 

these days _cost a minimum of $2000 each, some 15 million dollars 

would be involved, and this is just ~ initial cost. 

b. What additional costs are there? Spare parts, rotors 

and associated material. In providing u. S. cryptoaids NSA estimates 

a spare parts usage factor of 30% of the initial cost, with a 10% 

annual expenditure thereafter. For a five year period, then, an 

additional 12 million dollars would be involved. Rotors and other 

associated material would amount to another 10 million dollars. 

c. What about maintenance and other support? In the cryptographic supply business support does not stop with provision of an 

amount of material. Cipher machines are delicate instruments and 

requ.ire a considerable amount of maintenance. There would be two 

ways of supplying this: one wou1ld require the use of u. s. 1naintenance personnel, Service or otherwise, for the purpose of maintaining 

the material; the other way would be the training of maintenance 

personnel of other nations by the U. s. Either of these will be 

costly. Other support is needed also. Nations using the equipment 

would have to be furnished current procedures, docxrine and, when 

necessary, instructions on modifications. Then it would have to be 

seen to that operAtor training, as well as maintenance training, is 

properly carried out. 

d. What do these two types of training amount to'l It would 

be nec~ssary to establish schools to which nations could send cadres 

of maintenance men and operators for training. These men would then 

return to their countries and train others. If we compare this 

requirement to the method which we currently employ in the U. s. we 

can estimate that each nation would have to send about six individuals, 

with the necessary qualifications, for a maintenance training course 

which, if conducted in English, would take a minimum of eight weeks. 

If other languages have to be used the course would be longer and 

infinitely more complicated. Operator training would take less time, 

probably two weeks. 

2 

SECRET 
Serial: 00159-S 

e. What are the legal implications? This is difficult 

to even predict. In some of our crypto-equipments there are patented 

components. In each case of issue, proper legal agreements would 

have to be entered into. 

f'. What would be the eff'ect on COMINT? Under such a program 

as this the effect is obvious. For all practical purposes COMINT 

from the non-Communist countries would cease. 

g. What further political implications are there? This is 

a case of something which once done cannot be undone. Suppose that 

a country now classed as a non-Communist, friendly nation changes 

"color" after material aid has been supplied. We cannot get the 

equipment back, and we will have been placed in a position of having 

helped an enemy or potential enemy. 

4. In summation, once the bars are let down. the u. s. becomes 

the supplier of COMSEC to virtually the whole world. It is a multimillion-dollar supply business end, like any other multi-milliondollar supply business, all the complexities of logistics, legal 

proceedings end financial arrangements add up to infinitely more than 

the dollars-and-cents involved. 

5. NSA is in no position to undertake such a burden and carry 

out its primary mission. If such a program were authorized, NSA has 

neither the plant, personnel, facilities, or space to even consider 

the task. 

6. If the decision is made that the U. s. is to become the 

world-wide supplier for cryptographic materials, there are probably 

several workable methods of implementing the decision. One such 

method might be the establishment of a separate government corporation, with NSA participating on the "board of directors". This 

corporation would be responsible for all negotiations and the supply 

of all such material. 

...Y'L.LI........ J. CANINE 

Lieutenant eral, US Army 

Director 

3 

SECRET 
• 

M/R: This paper was prepared at the Director's instruction to 

augment remarks made by him at the 103rd meeting of USCIB. It is 

to be discussed at a joint meeting of USCSB and USCIB on 3 June 1954. 

cc: V/DIR 

AG 

c/s 

COMSEO (3) 41 (2) 

vie~ 

F.C.Austin, 41, 60489/es 

P/P 

S/ASST (Mr. Friedman) "!l.llC'i--~~~~~~~ 

SECRET