Demolish Part of Bugged Embassy, Schlesinger Says

WASHINGTON —  Former Defense Secretary James R. Schlesinger, completing a five-month security examination ordered by Secretary of State George P. Shultz, has recommended demolition of the top three floors of the unfinished eight-story, $196-million U.S. Embassy in Moscow, which U.S. officials say is “honeycombed” with Soviet bugging devices.

Schlesinger told the Senate Budget Committee on Monday that he also has recommended that $40 million more be spent making the radical renovations and building a new annex to house the most sensitive embassy offices.

He said the still-unoccupied building is “extensively permeated . . . with a full array of intelligence devices for which we do not yet understand either the technology or the underlying strategy.” Schlesinger blamed the United States for failing to anticipate “the boldness, thoroughness and extent” of the Soviet penetration of embassy security.

He faulted the 1972 embassy construction agreement that allowed the Soviets to pour concrete for the building away from the construction site at an area where it is believed the sophisticated, and at first undetected, listening devices were implanted.

“The prime party to blame is not the Soviets but ourselves,” said Schlesinger, who also was formerly director of the CIA. “We have presented them with too much opportunity, too much temptation for them to resist.”

Deputy Secretary of State John C. Whitehead, also appearing before the committee, said the department has made changes designed to prevent such problems from occurring again. In response to questions from senators who called the Moscow project a “horrendous mess . . . that has been bungled for years,” he conceded that Soviet bureaucrats “would have disappeared from the face of the Earth” if they had performed as badly as their U.S. counterparts.

Marine Guards Scandal

U.S. officials have known for some time that the unfinished embassy office building was full of electronic eavesdropping devices. A subsequent scandal over alleged Soviet use of Marine guards to enter the old embassy complex heightened concern over espionage at the new site as well. Shultz toured the new embassy building in April and said it was a “honeycomb of listening devices.”

Schlesinger said the alterations and new construction that he has recommended would have to be done exclusively with American workers and construction materials.

Specifically, he proposed that the top three floors of the new embassy building be dismantled and replaced with modular steel construction. The bottom five floors would be retained but devoted only to non-sensitive operations such as medical facilities, consular offices and storage areas.

Schlesinger said that a new 38,000-square-foot annex should be built on the Moscow embassy grounds for “the most sensitive functions,” and he recommended that Soviet occupation of a new embassy building in Washington be delayed until the United States is satisfied with changes made to its Moscow facility.

“If full Soviet cooperation is obtained and the necessary resources for the project are allocated in a timely manner, the new chancery complex should be ready for occupancy in 1990,” Schlesinger said. However, he acknowledged that Soviet cooperation is not certain.

More Productive to U.S.

“We should bear in mind one central consideration: a reasonably secure and effective embassy in Moscow is more productive to our interests than its Soviet counterpart in Washington is to theirs,” Schlesinger told senators. “Manifestly, a window on a closed society is more valuable than yet another window on an open society.”

Schlesinger also said his investigation showed that Soviet spy technology may have surpassed American capabilities.

“We now face a rising curve of Soviet technology with no gap between what we can do and what the Soviets can do,” he said. “In fact, in some areas they are ahead of us.”

Schlesinger’s report was the first of three examining embassy security problems in Moscow and other sensitive areas. A panel headed by former Defense Secretary Melvin R. Laird is scheduled to report to Shultz on Wednesday the findings of its investigation into what went wrong in Moscow. And a worldwide study by the President’s Foreign Intelligence Advisory Board is due in mid-July.

In addition, there are a number of other advisory groups engaged in analysis and investigation of various aspects of the Moscow embassy problem. However, one White House source expressed dismay that, in his view, none of the groups or studies establishes “accountability for the disaster.”