The Office of Policy Coordination was the first peacetime covert action agency in the United States, created by Democratic President Harry S. Truman in 1948. By 1952 it was folded fully into the Central Intelligence Agency, which was by this point and for good reason establishing the predominance of a civilian intelligence agency in the American intelligence community.
OPC was formed by National Security Council order 10/2 (NSC 10/2 for short). The NSC itself was a new innovation, initially given the task of overseeing the fledgling intelligence community of the United States. Truman, initially fearful of an American "Gestapo", had been gradually coming to accept the need for intelligence activity as the realities of the Cold War descended. OPC was part of the "alphabet soup" of three letter agencies that emerged before the exact shape of the intelligence community solidified. At this early stage of development, the rules for its conduct were not clear, and it enjoyed considerable leverage.
This was in direct contradiction to its rather bland name, which was supposed to suggest that it existed merely to carry out policy rather than to in any way make it. The name was also supposed to indicate that it only was the covert action arm of the U.S. government, and that it would co-ordinate the help it received from other agencies in this regard. Finally, its bland name was adopted for the reason that intelligence organizations always have such names - they are addicted to obfuscation. Notice that no country on the planet has, for instance, a "Signals Intelligence Agency" - no, they have such entities as the "National Security Agency", or "General Communications Headquarters".
OPC was mainly founded on the basis of the sensible argument that if the Communists were going to engage in dirty tricks, then the U.S. had best be no innocent in that regard either. The Soviet Union had decades of experience in subversion and covert action. Covert action is defined as an attempt to influence the political situation in another country through covert methods, almost always with plausible deniability. This means that it should be possible for the intervening power to deny it had anything to do with what was going on. The OPC served another function, known as "circuit-breaking" - it, and no venerable department, would take responsibility should an action be compromised. Neither the Secretaries of Defence or State, nor the President, would be implicated.
The first indication to Washington officials that covert action could be a boon was the Italian elections of 1948. Truman had authorized a program of intervention to organize the centre-right in Italian politics and manipulate public opinion through devices such as forgeries. With the help of American money, the second largest Communist Party on the planet went down to defeat, and the democracy of a major European country was preserved.1 To Truman and his Cabinet, this amounted to a major - and cheap - victory. He signed off on NSC 10/2 shortly thereafter.
What really got the ball rolling for the Office of Policy Coordination was the Central Intelligence Act 1949. In these early days of American innocence, Congress didn't ask too many questions of the intelligence community. Pearl Harbor had demonstrated the need for peacetime intelligence, and the Soviet threat made felt the need for counter-operations. Thus the Act authorized the recruitment of defectors in spite of immigration laws (which, for instance, might have stopped the recruitment of Nazi war criminals who turned out to be useful) and saved the Director of Central Intelligence from having to give an account of the community's expenditures. His signature on the accounts would be "deemed a sufficient voucher for the amount therein certified".
OPC bloomed given sudden accessibility to a large slush fund which was promptly provided on the basis of this legislation. Its head was Frank Wisner, who had served in Romania during the war as the man on the ground for the Office of Strategic Services, the forerunner of the CIA. He had personally witnessed Soviet subjugation of this small nation during and after the war, and would talk vividly for the rest of his life of his efforts to help those the Soviets were dragging away to labour camps or worse. He had been disgusted by the complacency of Washington during these events, when the administrations had been slow to adjust to the idea that the USSR was turning from ally to enemy.
He was hence, in a way, ideal for the task of heading OPC. Its early goal was to try and penetrate the Iron Curtain and undermine Soviet dominance of Eastern Europe. In the early days of the Cold War, it was still hoped rollback could be achieved, but no-one had the appetite for conventional war. Hence, covert action was the chosen tool. Wisner believed he had a great tool in the refugee camps just on the Western side of the Iron Curtain, which contained tens of thousands who had fled the Soviet jackboot. Specially-picked men were duly trained for parachuting behind enemy lines, but the operations inevitably ended in the death of the hapless operatives.
Perhaps the worst failure for OPC in Europe involved a Polish resistance organization named Freedom and Independence (the Polish acronym of which is WiN). WiN claimed to have 500 members and 20,000 sympathizers, and asked for money and guns whilst feeding information back to OPC. After several years of cooperation with WiN, the CIA heard a disturbing broadcast from Radio Warsaw - it turned out WiN had been an elaborate Communist ruse, a totally fake organization established by the Polish secret police to fool the West. The efficiency of the Communist secret police would continue to frustrate OPC.
Perhaps the greatest success of OPC came in Asia, where the Communist "Huk" insurgency was defeated and a competent national leader installed. The Huks had greatly disturbed American soldiers at the turn of the century, when they had made a habit of mutilating their own testicles and launching themselves at the Yankee imperialists in a fit of blind rage from the pain that ensued. Now, they threatened, less prosaically but more dangerously, to install a Communist government in the Phillipines.
Luckily, Edward Lansdale (the model for Pyle in The Quiet American) was on the case to provide money and encouragement to the most promising of local politicians, Ramon Magsaysay. Through a series of psychological operations, support for the insurgency was gradually stolen. Lansdale was nothing if not ingenious. For instance, he exploited local vampire myths by taking the corpses of villagers, poking holes in their necks, and dumping them in areas associated with the Huks. The rumour would then be spread that vampires fed on those who helped the insurgency.
Eventually, the OPC was brought more firmly under the control of the Central Intelligence Agency. This was brought about by DCI Walter Bedell-Smith, who was keen to rein in Wisner and his organization. He worried that the search for plausible deniability had led to Wisner receiving too much leverage and room for initiative, and was keen to discourage the situation getting further out of hand. Unfortunately for him and the United States, the inaugaration of Dwight D. Eisenhower as President and Allen Dulles as DCI led to the resumption of this trend, culminating in the Bay of Pigs fiasco.
1. There will always be forceful debate about the precise effect that American covert action has had in a variety of instances, especially contentious ones involving the overthrow of governments - such as in Iran in 1953, or Chile in 1973. The same is true here, although the impact on the country's politics was not nearly as great. What would have happened without the intervention of American intelligence in this case, like the others, is impossible to say. Advocates and detractors of the CIA have their reasons for suggesting American influence was decisive, and may in some cases have built up a myth that it was much more important than it really was.
The most detailed source on the activities of OPC I've encountered is Evan Thomas, The Very Best Men: The Early Years of the CIA (New York, 1995). Especially thoughtful on the implications of covert action in a democracy is Rhodri Jeffreys-Jones, The CIA and American Democracy (New York, 1989). Christopher Andrew, For the President's Eyes Only: Secret Intelligence and the American Presidency from Washington to Bush (New York, 1995) remains the seminal work on the development of the intelligence community as a whole.