Hill & Knowlton and the CIA.

                           Public Relationships:
                       Hill & Knowlton, Robert Gray,
                                and the CIA
                             by Johan Carlisle
                from the Spring 1993 issue of CAQ (Number44)
   [INLINE] Public relations and lobbying firms are part of the revolving
   door between government and business that President Clinton has vowed
   to close. It is not clear how he will accomplish this goal when so
   many of his top appointees, including Ron Brown and Howard Paster, are
   "business as usual" Washington insiders. Ron Brown, who was a lobbyist
   and attorney for Haiti's "BabyDoc"Duvalier, is Clinton's Secretary of
   Commerce. Paster, former head of Hill and Knowlton 's Washington
   office, directed the confirmation process during the transition period
   and is now Director of Intergovernmental Affairs for the White House.
   After managing PR for the Gulf War, Hill and Knowlton executive Lauri
   J. Fitz-Pegado became director of public liaison for the inauguration.
   The door swings both ways. Thomas Hoog, who served on Clinton's
   transition team, has replaced Paster as head of H&K's Washington
   Hill and Knowlton is one of the world 's largest and most influential
   corporations. As such, its virtually unregulated status, its
   longstanding connections to intelligence agencies, its role in shaping
   policy, and its close relationship to the Clinton administration
   deserve careful scrutiny. 
   In Turkey, "in July 1991, the same month President George Bush made an
   official visit there, the body of human rights worker Vedat Aydin was
   found along a road. His skull was fractured, his legs were broken, and
   his body was riddled by more than a dozen bullet wounds. He had been
   taken from his home by several armed men who identified themselves as
   police officers. No one was charged with his murder." De- spite
   hundreds of such "credible reports" acknowledged by the State
   Department, documenting use of "high-pressure cold water hoses,
   electric shocks, beating of the genitalia, and hanging by the arms,"
   Turkey reaps the benefits of U.S. friendship and Most Favored Nation
   status. "Last year Turkey received more than $800 million in U.S. aid,
   and spent more than $3.8 million on Washington lobbyists to keep that
   money flowing." Turkey paid for U.S. tolerance of torture with its
   cooperative role in NATO, and its support for Operation Desert Storm;
   it bought its relatively benign public image with cold cash. Turkey's
   favorite Washington public relations and lobbying firm is Hill and
   Knowlton (H&K), to which it paid $1,200,000 from November 1990 to May
   1992. Other chronic human rights abusers, such as China, Peru, Israel,
   Egypt, and Indonesia, also retained Hill and Knowlton to the tune of
   $14 million in 1991-92. Hill and Knowlton has also represented the
   infamously repressive Duvalier regime in Haiti.
   On October 10, 1990, as the Bush administration stepped up war
   preparations against Iraq, H&K, on behalf of the Kuwaiti government,
   presented 15-year-old "Nayirah" before the House Human Rights Caucus.
   Passed off as an ordinary Kuwaiti with firsthand knowledge of
   atrocities committed by the Iraqi army, she testified tearfully before
   "I volunteered at the al-Addan hospital...[where] I saw the Iraqi
   soldiers come into the hospital with guns, and go into the room where
   15 babies were in incubators. They took the babies out of the
   incubators, took the incubators, and left the babies on the cold floor
   to die."
   Supposedly fearing reprisals against her family, Nayirah did not
   reveal her last name to the press or Congress. Nor did this apparently
   disinterested witness mention that she was the daughter of Sheikh Saud
   Nasir al-Sabah, Kuwait's ambassador to the U.S. As Americans were
   being prepared for war, her story- which turned out to be impossible
   to corroborate -became the centerpiece of a finely tuned public
   relations campaign orches- trated by H&K and coordi- nated with the
   White House on behalf of the government of Kuwait and its front group,
   Citizens for a Free Kuwait.
   In May 1991, CFK was folded into the Washington-based Kuwait-America
   Foundation. CFK had sprung into action on August 2, the day Iraq
   invaded Kuwait. By August 10, it had hired H&K, the preeminent U.S.
   public relations firm. CFK reported to the Justice Department receipts
   of $17,861 from 78 individual U.S. and Canadian contributors and $11.8
   million from the Kuwaiti government. Of those "do- nations," H&K got
   nearly $10.8 million to wage one of the largest, most effective public
   relations campaigns in history.
   From the streets to the newsrooms, according to author John MacArthur,
   that money created a benign facade for Kuwait's image:
     "The H&K team, headed by former U.S. Information Agency officer
     Lauri J. Fitz-Pegado, organized a Kuwait Information Day on 20
     college campuses on September 12. On Sunday, September 23, churches
     nationwide observed a national day of prayer for Kuwait. The next
     day, 13 state governors declared a national Free Kuwait Day. H&K
     distributed tens of thousands of Free Kuwait bumper stickers and
     T-shirts, as well as thousands of media kits extolling the alleged
     virtues of Kuwaiti society and history. Fitz-Pegado's crack press
     agents put together media events featuring Kuwaiti "resistance
     fighters" and businessmen and arranged meetings with newspaper
     editorial boards. H&K's Lew Allison, a former CBS and NBC News
     producer, created 24 video news releases from the Middle East, some
     of which purported to depict life in Kuwait under the Iraqi boot.
     The Wirthlin Group was engaged by H&K to study TV audience reaction
     to statements on the Gulf crisis by President Bush and Kuwaiti
     officials. "
   All this PR activity helped "educate" Americans about Kuwait-a
   totalitarian country with a terrible human rights record and no rights
   for women. Meanwhile, the incubator babies atrocity story inflamed
   public opinion against Iraq and swung the U.S. Congress in favor of
   war in the Gulf.
   This free market approach to manufacturing public perception raises
   the issue of:
     whether there is something fundamentally wrong when a foreign
     government can pay a powerful, well-connected lobbying and public
     relations firm millions of dollars to convince the American people
     and the American government to support a war halfway around the
     world. In another age this activity would have caused an explosion
     of outrage. But something has changed in Washington. Boundaries no
     longer exist.
   One boundary which has been blurred beyond recognition is that between
   "propaganda"-which conjures up unpleasant images of Goebbels-like
   fascists-and "public relations," a respectable white collar
   profession. Taking full advantage of the revolving door, these
   lobbyists and spinmeisters glide through Congress, the White House,
   and the major media editorial offices. Their routine manipulations--
   like those of their brown shirted predecessors--corrode democracy and
   government policy. H&K's highly paid agents of influence, such as Vice
   President Bush's chief of staff Craig Fuller, and Democratic power
   broker Frank Mankiewicz, have run campaigns against abortion for the
   Catholic Church, represented the Church of Scientology, and the
   Moonies. They have made sure that gasoline taxes have been kept low
   for the American Petroleum Institute; handled flack for Three Mile
   Island's near-catastrophe; and mishandled the apple growers' assertion
   that Alar was safe. They meddle in our political life at every turn
   and apparently are never held accountable. Not only do these PR firms
   act as foreign propaganda agents, but they work closely with U.S. and
   foreign intelligence agencies, making covert operations even harder to
   In the 1930s, Edward Bernays, the "father of public relations,"
   convinced corporate America that changing the public's opinion--using
   PR techniques--about troublesome social movements such as socialism
   and labor unions, was more effective than hiring goons to club people.
   Since then, PR has evolved into an increasingly refined art form of
   manipulation on behalf of whoever has the large amounts of money
   required to pay for it. In 1991, the top 50 U.S.-based PR firms billed
   over $1,700,000,000 in fees. Top firms like Hill and Know- lton charge
   up to $350 per hour.
   PR firms manipulate public and congressional opinion and government
   policy through media campaigns, congressional hearings, and lobbying.
   They have the ability and the funds to conduct sophisticated research
   for their clients and, using inside information, to advise them about
   policy decisions. They are positioned to sell their clients access and
   introductions to gov- ernment officials, including those in
   intelligence agencies. Robert Keith Gray, head of Hill and Knowlton's
   Washington office for three decades, used to brag about checking major
   decisions personally with CIA director William Casey, whom he
   considered a close personal friend.
   One of the most important ways public relations firms influence what
   we think is through the massive distribution of press releases to
   newspapers and TV newsrooms. One study found that 40 percent of the
   news content in a typical U.S. newspaper originated with public
   relations press releases, story memos, or suggestions. The Columbia
   Journalism Review, which scrutinized a typical issue of the Wall
   Street Journal, found that more than half the Journal's news stories
   "were based solely on press releases." Although the releases were
   reprinted "almost verbatim or in para- phrase," with little additional
   reporting, many articles were attributed to "a Wall Street Journal
   staff reporter."
   While some PR campaigns are aimed at the general pub- lic, others
   target leadership, either to persuade them or to provide them with
   political cover. On November 27, 1990, just two days before the U.N.
   Security Council was to vote on the use of military force against
   Iraq, while the U.S. was extorting, bullying, and buying U.N.
   cooperation, Kuwait was trying to win hearts, minds, and tear ducts.
   "Walls of the [U.N.] Council chamber were covered with oversized color
   photographs of Kuwaitis of all ages who reportedly had been killed or
   tortured by Iraqis. ...A videotape showed Iraqi soldiers apparently
   firing on unarmed demonstrators, and witnesses who had escaped from
   Kuwait related tales of horror. A Kuwaiti spokesman was on hand to
   insist that his nation had been `an oasis of peaceful harmony' before
   Iraq mounted its invasion." This propaganda extravaganza was
   orchestrated by Hill and Knowlton for the government of Kuwait. With
   few exceptions, the event was reported as news by the media, and two
   days later the Security Council voted to authorize military force
   against Iraq.
   THE INTELLIGENCE CONNECTION The government's use of PR firms in
   general, and Hill and Knowlton in particular, goes beyond ethically
   dubious opinion manipulation. It includes potentially illegal proxy
   spying operations for intelligence agencies. "H&K recruited students
   to attend teach-ins and demonstrations on college campuses at the
   height of the Vietnam War, and to file agent-like reports on what they
   learned," according to author Susan Trento. "The purpose was for H&K
   to tell its clients that it had the ability to spot new trends in the
   activist movement, especially regarding environmental issues." Richard
   Cheney (no relation to former Secretary of Defense Cheney), head of
   H&K's New York office, denied this allegation. He said that H&K
   recommends that its clients hire private investigative agencies to
   conduct surveillance and intelligence work. But, Cheney admitted, "in
   such a large organization you never know if there's not some sneak
   operation going on."
   Former CIA official Robert T. Crowley, the Agency's long-time liaison
   with corporations, sees it differently. "Hill and Knowlton's overseas
   offices," he acknowledged, "were perfect `cover' for the
   ever-expanding CIA. Unlike other cover jobs, being a public relations
   specialist did not require technical training for CIA officers." The
   CIA, Crowley admitted, used its H&K connections "to put out press
   releases and make media contacts to further its positions. ...H&K
   employees at the small Washington office and elsewhere, distributed
   this material through CIA assets working in the United States news
   media." Since the CIA is prohibited from disseminating propaganda
   inside the U.S., this type of "blowback"- which former CIA officer
   John Stockwell and other researchers have often traced to the
   Agency-is illegal. While the use of U.S. media by the CIA has a long
   and well-documented history, the covert involvement of PR firms may be
   news to many. According to Trento:
     "Reporters were paid by the CIA, sometimes without their media
     employers' knowledge, to get the material in print or on the air.
     But other news organizations ordered their employees to cooperate
     with the CIA, including the San Diego-based Copley News Service.
     But Copley was not alone, and the CIA had `tamed' reporters and
     editors in scores of newspaper and broadcast outlets across the
     country. To avoid direct relationships with the media, the CIA
     recruited individuals in public relations firms like H&K to act as
     middlemen for what the CIA wanted to distribute.
   This close association and dependence upon the intelligence community
   by reporters has created a unique situation which has shielded PR
   executives and firms from closer scrutiny by the media and Congress.
   According to Trento, "These longstanding H&K intelligence ties and
   CIA-linked reporters' fears that Gray might know about them might
   partially explain why Gray has escaped close media examination, even
   though he was questioned about his or his associates' roles in one
   major scandal after another during his long Washington career."
   Over the years, Hill and Knowlton and Robert Gray have been implicated
   in the BCCI scandal, the October Surprise, the House page sex and drug
   scandal, Debategate, Koreagate, and Iran-Contra. In October 1988,
   three days after the Bank of Credit and Commerce International (BCCI)
   was indicted by a federal grand jury for conspiring with the Medellin
   Cartel to launder $32,000,000 in illicit drug profits, the bank hired
   H&K to manage the scandal. Robert Gray also served on the board of
   directors of First American Bank, the Washington D.C. bank run by
   Clark Clifford (now facing federal charges) and owned by BCCI. Gray
   was close to, and helped in various ways, top Reagan officials. When
   Secretary of Defense Caspar Weinberger's son needed a job, Gray hired
   him for $2,000 a month. "And when Gray's clients needed something from
   the Pentagon, Gray and Co. went right to the top." Gray also helped
   Attorney General Ed Meese's wife, Ursula, get a lucrative job with a
   foundation which was created by a wealthy Texas client, solely to
   employ her.
   ROBERT KEITH GRAY- PRIVATE SPOOK? Robert Keith Gray, who set up Hill
   and Knowlton's important Washington, D.C. office and ran it for most
   of the time between 1961 and 1992, has had numerous contacts in the
   national and international intelligence community. The list of his
   personal and professional associates includes Edwin Wilson, William
   Casey, Tongsun Park (Korean CIA), Rev. Sun Myung Moon, Anna Chennault
   (Gray was a board member of World Airways aka Flying Tigers), Neil
   Livingstone, Ro- bert Owen, and Oliver North.
     "Most of the International Division [of Gray & Co.] clients," said
     Susan Trento, "were right-wing governments tied closely to the
     intelligence community or businessmen with the same associations."
   In 1965, with Gray's help, Tongsun Park, had formed the George Town
   Club in Washington. According to Trento:
   Park put up the money and, with introductions from Gray and others,
   recruited "founders" for the club like the late Marine Gen. Graves
   Erskine, who had an active intelligence career. Anna Chennault became
   a force in the club. Others followed, and most, like Gray, had the
   same conservative political outlook, connections to the intelligence
   world, or `congressional overtones.' Gray's ties to right-wing Asians
   like Chennault and Park had deep roots. Gray had been critical of
   Eisenhower [when he was appointments secretary for Eisenhower] for
   never being partisan enough. Perhaps that is why Gray embraced
   wholeheartedly the powers behind the China Lobby. One reason Gray was
   attached to the lobby was that they had long been behind the funding
   of Richard Nixon's various campaigns.
   Tongsun Park was an "agent of influence," trained by the Korean
   intelligence agency, which was created by and is widely regarded as a
   subsidiary of the CIA. The George Town Club has served as a discrete
   meeting place where right-wing foreign intelligence agents can
   socialize and conduct business with U.S. government officials.
   Robert Gray has also been linked with former CIA and naval
   intelligence agent Edwin Wilson, although Gray denies it. In 1971,
   Wilson left the CIA and set up a series of new front companies for a
   secret Navy operation-Task Force 157. Wilson says that Robert Gray
   "was on the Board [of Directors]. We had an agreement that anything
   that H&K didn't want, they would throw to me so that I could make some
   money out of it, and Bob and I would share that."
   THE GRAY AREA BEHIND HILL & KNOWLTON Gray's connection to Iran-Contra
   has never been fully examined. Notably, the Tower Commission, Reagan's
   official 1986 investigation, all but ignored it. In 1983, Texas
   Senator John Tower had declined to seek reelection thinking he had a
   deal with Reagan to become Secretary of Defense. After Weinberger
   decided to stay on in the second Reagan term, Tower found himself
   without a job. In 1986, his friend Robert Gray offered him a position
   on the board of directors of Gray and Co. Shortly thereafter, Tower
   was asked to head the presidential inquiry. Not suprisingly, the Tower
   Commission kept Gray and Co. out of the investigation, in spite of the
   facts that several key players in the scandal had worked for Gray and
   Co., and Gray's Madrid office was suspected of involvement in the
   secret arms shipments to Iran.
   Despite large gaps in the official inquiry, it has been established
   that Robert Owen, Oliver North's messenger and bagman, worked for Gray
   and Co. after leaving then-Senator Dan Quayle's staff in 1983. Owen
   worked primarily with Neil Livingstone, a mysterious figure who claims
   to be a mover and shaker in the intelligence world but who is
   described as a "groupie." Livingstone worked with Ed Wilson, Air
   Panama, and as a front man for business activities sponsored by the
   CIA and Israeli intelligence. Owen and Livingstone traveled frequently
   to Central America to meet with the Contras in 1984. An interesting
   footnote to Iran-Contra is that in 1986, Saudi Arabian arms broker
   Adnan Khashoggi hired Hill and Knowlton and Gray and Co. to milk
   maximum publicity out of his major donation to a $20.5 million sports
   center, named after him, at American University.
   THE FOURTH BRANCH OF GOVERNMENT The pattern of influence peddling and
   insider abuse is clear. The potential for real reform is less obvious.
   Despite his stated intention to restrict the influence of lobbyists
   and PR manipulation, Clinton's reforms are viewed with cynical
   amusement by those in the know. Although newly restricted from
   directly lobbying their former agencies, retiring government officials
   can simply take jobs with PR firms, sit at their desks, and instruct
   others to say "Ron, or Howard, sent me." Nor does the updated Foreign
   Agents Registration Act have real teeth. The act-legislated in 1938
   when U.S. PR firms were discovered working as propagandists and
   lobbyists for Nazi Germany-is rarely enforced. While it requires
   agents of governments to register, it omits requirements for agents of
   foreign corporations, who often serve the same interests.
   And if loopholes for lobbying are comfortably large, public relations
   activities remain totally unregulated and unscrutinized by any
   government agency. Given the power and scope of PR firms, their track
   records of manipulation, their collusion with intelligence agencies,
   and their disregard for the human rights records and corporate
   misdeeds of many of their clients, this lack of oversight endangers
   democracy. Careful regulation, stringent reporting requirements, and
   government and citizen oversight are essential first steps in
   preventing these giant transnationals from functioning as a virtual
   fourth branch of government.
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