A Study Into the Size of the World s Intelligence Industry

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A STUDY INTO THE SIZE OF THE WORLD’S INTELLIGENCE

INDUSTRY

CHRISTIAN HIPPNER

A Thesis

Submitted to the Faculty of Mercyhurst College

In Partial Fulfillment of the of the Requirements for

The Degree of

MASTER OF SCIENCE

INAPPLIED INTELLIGENCE

DEPARTMENT OF INTELLIGENCE STUDIESMERCYHURST COLLEGE

ERIE, PENNSYLVANIAOCTOBER 2009


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DEPARTMENT OF INTELLIGENCE STUDIESMERCYHURST COLLEGE

ERIE, PENNSYLVANIA

A STUDY INTO THE SIZE OF THE WORLD’S INTELLIGENCE INDUSTRY

A ThesisSubmitted to the Faculty of Mercyhurst College

In Partial Fulfillment of the Requirements for The Degree of

MASTER OF SCIENCEIN

APPLIED INTELLIGENCE

Submitted By

Christian Hippner

Certificate of Approval:

___________________________ Kristan J. WheatonAssociate Professor Department of Intelligence Studies

___________________________ James G. BreckenridgeChair/Assistant Professor Department of Intelligence Studies

___________________________ Phillip J. BelfioreVice PresidentOffice of Academic Affairs

October 2009


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Copyright © 2009 by Christian Hippner All rights reserved.


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ACKNOWLEDGEMENTS

I would like to thank my primary reader, Kristan Wheaton, for his creativity, found

throughout this product. I would also like to thank Carl Hippner for his assistance in

interpretation. Finally, I would like to acknowledge Cole Davis for his technical

assistance and motivation, despite having a two o’clock meeting.


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ABSTRACT OF THE THESIS

A Study into the Size of the World’s Intelligence Industry

By

Christian Hippner

Master of Science in Applied Intelligence

Mercyhurst College, 2009

Professor Kristan J. Wheaton, Chair

[This thesis determines the approximate size of the world’s intelligence industry in

quantitative terms. It reviews existing literature which describes, in qualitative terms,

various themes found about intelligence agencies around the world. The thesis provides a

quantitative method to estimate unknown intelligence spending and personnel. The study

concludes that the world’s intelligence industry spends approximately 106 billion United

States Dollars, and employs about one million people. Furthermore, the hypothesized

direct correlation between Gross Domestic Product (GDP) and intelligence spending may

exist, but the research does not strongly support the assertion. It is apparent that GDP is a

factor when it comes to intelligence spending, but it does not seem to be the primary

component.]


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TABLE OF CONTENTSPage

COPYRIGHT PAGE ........................................................................................................ iii

ACKNOWLEDGEMENTS .............................................................................................. iv

ABSTRACT ........................................................................................................................v

TABLE OF CONTENTS .................................................................................................. vi

LIST OF TABLES .......................................................................................................... viii

LIST OF FIGURES .......................................................................................................... ix

CHAPTER

1 INTRODUCTION ............................................................................................ 1

2 LITERATURE REVIEW ................................................................................. 4

Information Gap ........................................................................................ 4Comparative Studies in Intelligence ......................................................... 7Self-Reporting Countries ......................................................................... 14Systematic Studies of Intelligence .......................................................... 16

3 METHODOLOGY ......................................................................................... 21

Data Collection ........................................................................................ 22Collection from Internet Sources ................................................. 23Collection from Other Sources ................................................... 27Other Relevant Information Collection ...................................... 28

Establishing Webpage Credibility .......................................................... 28Process for Estimating Unknown Spending ........................................... 29Process for Estimating Unknown Personnel ........................................... 30Standardizing Spending Units ................................................................. 31Standardizing Personnel Definitions ....................................................... 32

4 RESULTS ........................................................................................................ 33The Totals: Spending ............................................................................... 33The Totals: Personnel ............................................................................. 40Other Extracted Results .......................................................................... 46Summary of Results ................................................................................ 50

5 CONCLUSION ............................................................................................... 53


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BIBLIOGRAPHY ........................................................................................................... 63

APPENDICES ................................................................................................................ 75

Appendix A: Websites You Can Trust ............................................................... 76

Appendix B: Intelligence Spending Sorted Highest to Lowest ........................... 77Appendix C: Data for Individual Countries......................................................... 80


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LIST OF TABLES

Page

Table 4.1 Affect of US on Estimating 39

Table 5.1 List of Journals, Newsletters, and Other 56Relevant Database Productions

Table 5.2 Outcome of Assuming Intelligence Spending 59and GDP is Linear or Exponential


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LIST OF FIGURES

Page

Figure 4.1 Total World Intelligence Spending 33

Figure 4.2 Top Ten Percent Intelligence Spending 34

Figure 4.3 Intelligence Spending Sorted Largest to Smallest 37

Figure 4.4 Total Intelligence Employment 40

Figure 4.5 Geographic Position of Top Intelligence Employers 42

Figure 4.6 Top 21 Intelligence Employers 42

Figure 4.7 Comparing Intelligence Spending Per Person 43

Figure 4.8 Bottom 90 Percent Employment vs. 44Top Ten Percent Employment

Figure 4.9 Countries with Top Spending and Employment 45

Figure 4.10 Histogram of Intelligence Employment 45

Figure 4.11 Histogram of Source Credibility 50

Figure 5.1 Affect of a Linear Relationship Assumption on 61Intelligence Spending (US Not Included)

Figure 5.2 Countries with Known Intelligence Spending with 62Trend Lines (US Not Included)


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INTRODUCTION

This thesis is about intelligence in national security. Since the Treaty of

Westphalia every nation-state has had concerns about its national security, however

defined. The role of intelligence is one that supports policymakers, military

commanders, and nation as a whole. Describing the actual process of intelligence is the

subject of many books, reports, and theoreticians. Although the traditional view of

intelligence encapsulates its activities as a cylindrical process, new conceptual models

tend to structure it around a collaborative targeted process. Regardless of how one wantsviews what is intelligence, this thesis is about those engaged in it as a whole.

Intelligence as field of employment dates back to biblical days, when Moses sent

12 men to the land of Canaan in order to,

See what the land is like: whether the people who dell in it are strong or weak, few or many; whether the land they dwell in is good or bad;whether the cities they inhabit are like camps or strongholds; whether theland is rich or poor; and whether there are forests there or not. 1

Moses is a decision maker who wants to know everything that may be relevant, as his

tasking implies. He asks for reports on the economic, military, and social situation of

Canaan. While this passage is infamous in some intelligence communities, Sun-Tzu’s

writings may resonate in others. With the relatively few exceptions, the subject of how to

finance the collection of intelligence is generally missing. Collection systems, or in

Moses’ case human operators, require adequate funding to be successful. It is

1 Numbers 13:18-20 (New King James Version).


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unimaginable that Moses sent 12 men “who were heads of the children of Israel” without

food or other provisions.2 Yet discussion regarding this subject is absent.

If intelligence requires funding, like the rest of the national security

establishment, then every nation must allocate a budget. Various studies aiming to

estimate national defense spending already exist. Some countries issue so-called white

papers, while research institutions, such as the Stockholm International Peace Research

Institute (SIPRI) and the International Institute for Strategic Studies (IISS), have

elaborate methodologies to determine the spending of countries that do not self-report.

While each entity has a particular estimate regarding the world’s spending on defense,none have ventured into a more nuanced subset of national security – intelligence.

This thesis is a study to determine the approximate size of the world’s national

intelligence industry. It uses two separate indicators to determine size. The first

indicator is intelligence spending by individual nations. The second indicator of size is

intelligence personnel under employment by individual nations. For the purposes of this

study, the components of the intelligence industry are, broadly speaking, services or

agencies that are direct divisions of a recognized government.

Understanding the size of the world's intelligence industry is significant for three

reasons. First, there is no existing study with the purpose of discovering the approximate

size of the global intelligence industry. Second, understanding its size can be useful for

allocating resources by US intelligence agencies. Third, knowing the size of the world's

intelligence industry would be helpful to educational institutions for their own planning.

As the intelligence studies field grows, knowing the relative level of demand for

professionals in this market will likely support these institutions in recruiting practices.

2 Numbers 13:3 (New King James Version).


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To that end, a comprehensive and quantitative study is necessary. Although there are

numerous smaller studies that focus on certain regions or nations, they all fit into the

realm of qualitative discussions. While they add to the body of literature for this field,

they fall short of exploring the “human resources” aspect. The study could also assist in

training institutions’ recruitment by indicating the job market that exists for intelligence

professionals.

Determining the size of the world’s intelligence industry is also relevant for

practitioners. A study of this nature would give a national intelligence community

another method to benchmark their performance, as well as assist in future planning.Knowing the relative size of other nations’ capabilities can result in more efficient

resource allocation or support new hiring practices.

There are certain limitations to this study. First, it does not intend to study the

organizational structure of an intelligence community of a given country. It simply wants

to determine an amount spent by that community. Second, governments are not always

willing to publish such data and if they do, it may be intentionally inaccurate. This study

can and will make the most accurate and conservative estimates as possible. A person

can delve deep into government publications and other primary data for years in an

attempt to determine a single precise answer. This is unnecessary due to the scale of the

study – the individual numbers are more likely in the hundreds of millions of dollars,

meaning that the impact of relatively few dollars is negligible. Third, for many countries

there is no existing information at all. This study estimates these figures using a process

described in Chapter 3, and then presents its findings in Chapter 4.


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LITERATURE REVIEW

There are a limited number of comprehensive studies into the world’s different

intelligence systems and agencies. Most studies on the topic of national intelligence

communities are qualitative in nature. They explore a variety of intelligence related

topics, such as structure and oversight, but few actually engage in describing their subject

in quantitative terms. The following literature review has four sections. The first section

briefly discusses why there are few systematic studies describing intelligence in

quantitative terms. The second section discusses the different comparative studies of intelligence systems. The third section examines countries with self-reported data, their

relevance, and their drawbacks. The fourth and final section looks at the existing

attempts to systematically document different intelligence communities.

Information Gap

There are no comprehensive studies analyzing the total spending of the world’s

different intelligence organizations, or are there studies indicating their accumulated size.

One argument against the systematic study of intelligence is that the systems in different

countries are not comparable. In the words of author Michael Warner, “both inside and

outside scholars have sought to compare and contrast intelligence disciplines and

organizations across multiple national experiences and time periods. Unfortunately, this

is not yet possible to do in a systematic manner”.3 This mindset is perhaps the primary

reason for the lack of research into these matters. However, arguing that a transnational

quantitative comparison is not possible hinges on faulty assumptions.

3 Michael Warner, “Sources and Methods for the Study of Intelligence,” in Handbook of IntelligenceStudies, ed. Lock K. Johnson (London and New York: Routledge, 2007), 25.


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The argument assumes that the functions, roles, and missions of intelligence

organizations are inconsistent in international situations and cannot be categorized.

Notable intelligence scholar Loch K. Johnson argues against this point, saying that there

are basic common features found in all national intelligence apparatuses. According to

Johnson, there are three basic activities of these governmental entities – collection and

analysis, covert action, and counterintelligence.4 He argues that these three activities are

universally found in all national intelligence systems, regardless of the security

environment surrounding the country. This point seems to echo in the writings of Marina

Caprini, a theoretician on security-sector reform, who says that “within government,intelligence has come to be thought of as comprising four main activities: collection,

analysis and estimates, counterintelligence and covert action”.5 At the heart of the three

activities, Johnson argues, is national wealth – Gross Domestic Product (GDP).6 Johnson

would likely argue that the security situation around a nation impacts intelligence

spending less than its national wealth. Of wealthy nations, he says,

Because of the breadth of their concerns, not even expenditures in therange of $35 billion a year (the widely reported figure for U.S. intelligencein 2002-2003) can offer transparency for the entire globe – especiallywhen adversaries choose to conceal their schemes and weapons systems indeep underground caverns, with camouflage, or by other methods of stealth to avoid the prying lens of satellite cameras orbiting above them.In contrast, the intelligence objectives of smaller nations are much morelimited, say, to a single region or even a solitary enemy. Some may viewthis paradox as self-evident, but comparisons of the intelligence systemsof different countries are often made without taking into account thedifferences in their funding abilities and targeting needs.7

4 Loch Johnson, “Bricks and Mortar for a Theory of Intelligence,” Comparative Strategy. 22, no. 1 (2003):1.5 Marina Caparini, “Controlling and Overseeing Intelligence Services in Democratic States,” in DemocraticControl of Intelligence Services: Containing Rogue Elephant , ed. Hans Born and Marina Caparini(England: Ashgate, 2007), 5.6 Loch Johnson, “Bricks and mortar for a Theory of Intelligence,” Comparative Strategy 22, no. 1 (2003):22-23.7 Ibid, 3.


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Outside of national wealth, Johnson argues that other attributes are necessary for

successfully implementing these activities, such as focused targeting, all-source

synergism, and strong communication.

8

These activities are important, but they are aresult of three basic features, collection and analysis, covert action, and

counterintelligence.

The ultimate goal of these activities is to reduce the level uncertainty for the

decision-maker. The end goal for national intelligence agencies is also inherently

different from other governmental entities with similar features. For instance, law

enforcement bodies often engage in Johnson’s three basic actives. They collect and

analyze crime statistics in order to identify problems and determine the best preventative

measures.9 They engage in undercover operations, as well as establish security measures

to prevent the dissemination of sensitive information. In short, many law enforcement

agencies engage in intelligence. However, the purpose of having a law enforcement

agency is to enforce laws, while its end goal is to facilitate crime and problem

reduction.10

Nevertheless, the primary attribute for the successful implementation of Johnson’s

activities is national wealth, suggesting that only wealthy nations have large, integrated,

intelligence systems. Yet Johnson is quick to admit that there are some exceptions to his

8 Ibid.9 Veronica Coleman and others, "Using Knowledge and Teamwork to Reduce Crime," National Institute of

Justice Journal 241, (1999): 18-20, http://www.ncjrs.gov/pdffiles1/jr000241d.pdf .10 Jerry H. Ratcliffe, "Intelligence-led policing: Anticipating Risk and Influencing Action," in press 2009,3, http://jratcliffe.net/papers/Ratcliffe%20(draft)%20ILP-Anticipating%20risk%20and%20influencing%20action.pdf .


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theory.11 He points to Russia as an example, saying while it may maintain a large

intelligence service, it is not an affluent nation.12

Johnson’s conceptual framework seems to suggest an observable correlation

exists between a nation’s wealth and the size of its intelligence community. If this is true,

further research is necessary to test Johnson’s assertion that national wealth, GDP,

determines the limits of intelligence activity. While most authors tend to focus

intelligence issues such as oversight, democratic control, and the significance of 9/11,

Johnson’s assertion is measurable in quantitative terms. His assertion is not only

quantitative but free from cultural biases. The next section reviews existing comparativestudies of intelligence, which are predominately qualitative in nature.

Comparative Studies in Intelligence

There are several ways existing comparative studies describe different

intelligence systems. The first section here describes intelligence in the context of the

Cold War, the second section describes intelligence through the lens of the Civil-Military

Relations (CMR) model, and the third section describes intelligence from the non-

western perspective. Common themes exist throughout all three sections, for instance, all

of the authors use a case-study format to compare intelligence systems. Each case-study

uses narratives and qualitative information to describe intelligence communities – another

theme in all three sections – and also tend to focus on research at the national level.

There are several reasons to conduct comparative studies of intelligence communities.

According to Peter Gill, conducting comparative studies allows one to “find out about

11 Loch Johnson, “Bricks and mortar for a Theory of Intelligence,” Comparative Strategy 22, no. 1 (2003):15.12 Ibid.


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then moving to its most recent structure.18 He describes the relationship between the

Soviet Union and the other communist nations as unequal, where the smaller nations tend

to aid the Soviets.19 Laqueur’s historical approach is different than his methods used to

compare the various open societies. The dichotomy in approaches makes it difficult to

have a transnational comparison. One example is his description of the Soviet Union’s

intelligence structure – he focuses more on the weaknesses in their operations, rather than

comparing different agencies to one another.20 While he explains in some length about

the relationship between intelligence producers and consumers in open societies, he

glazes over the subject when writing about the Soviet system. Instead, his focus remainsmore on its historical development and current defects.21

Other comparative studies use the Civil-Military Relations (CMR) model to

compare intelligence communities. Scholar Robert Jervis says the role of intelligence is

the “missing dimension” in international relations and advocates using the CMR model. 22

There are some interesting parallels between CMR studies and other studies analyzing

relations between civilian authorities and intelligence services. According to Jervis, the

general view of intelligence services and militaries is that they “should be strong,

efficient, and professionalized, but on the other hand they should not set their own goals

and they must respond to civilian authority…We want the military and intelligence to be

18 Ibid, 233-248.19 Ibid, 249-250.20 Ibid, 248-252.21

There are a number of writings on the defects of the Soviet intelligence apparatus and Laqueur’sdiscussion is not entirely out of context. A more recent writing on this subject comes from MichaelHerman in Intelligence Services in the Information Age. Herman discusses the role of the intelligenceservices in under Stalin and how their assessments were intentionally subjective. This continued after Stalin and exemplifies one difference between western intelligence and non-western intelligence. SeeMichael Herman, Intelligence Services in the Information Age (Portland, Oregon: Frank Cass Publishers,2001), 16-19.22 Robert Jervis, “Intelligence, Civil-Intelligence Relations, and Democracy,” in Reforming Intelligence:Obstacles to Democratic Control and Effectiveness, ed. Thomas Bruneau and Steven Boraz (Austin, Texas:University of Texas Press, 2007), xix.


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under civilian control but also to resist illegitimate orders”.23 Studies using the CMR

analogy generally fall into two broad categories, intelligence in modern democracies and

intelligence in emerging democracies. The overall focus in each category is how to

increase democratic civilian control over the intelligence organization of a given

country.24

Democratic civilian control is possible by giving legal oversight authority to the

executive, legislative, or judicial branches of government. According to authors Steven

Boraz and Thomas Bruneau, a favorite oversight mechanisms used by governmental

bodies is budgetary review.

25

They argue that in modern democracies, executive bodiesexercise budgetary control through advisory departments, such as the Office of

Management and Budget (OMB).26 However, they are clear that budgetary review is not

the only oversight tool at the disposal of the executive bodies. Boraz and Bruneau both

agree that legislative bodies are able to control intelligence activities through budgetary

control and fund allocation.27 Legislative bodies accomplish budgetary oversight by

establishing oversight and appropriations committees.28 The CMR model analyzes

intelligence spending as a way to keep these organizations under the control of elected

officials, and ultimately to learn about the effective practices of well-performing nations.

However, these comparative case studies tend to introduce a certain level of

Western-bias into their methods. This creates two problems. The first is whether or not a

nation is measurably democratic. For countries conceptualized as undemocratic, the

23 Ibid, xiii.24 Steven Boraz and Thomas Bruneau, “Best Practices: Balancing Democracy and Effectiveness,” in

Reforming Intelligence: Obstacles to Democratic Control and Effectiveness, ed. Thomas Bruneau andSteven Boraz (Austin, Texas: University of Texas Press, 2007), 331.25 Ibid, 14.26 Ibid, 3027 Ibid, 15.28 Ibid, 45.


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national intelligence system is automatically exempt from study. If the goal is to observe

how various democratic nations maintain or create civilian control over their intelligence

services, countries such as China or Burma, which are generally seen as undemocratic,

cannot be studied for comparison. The likely underpinning argument for this point-of-

view is that civilian control is desirable.

The second problem addresses the subjectivity of what is desirable. Civilian

control is desirable for whom? Iran has a standardized election process, yet would the

West prefer to deal with the Supreme Council or the former Shah? If the ultimate

purpose of using the CMR model to study national intelligence systems is to learn how toincrease civilian control, then it is preferable to study Iran under the Supreme Council.

Using CMR as model creates the assumption that more civilian control is a good thing

(the researcher is inclined to agree). However, the Western bias that enters into these

studies results in inappropriate comparisons. These comparisons may include budgetary

reviews to satisfy the old adage “follow the money” but not to study transnational

spending patterns.

A third body of comparative literature might counter cultural bias, as it attempts

to gather knowledge about non-western intelligence systems. This literature comes from

native contributors and it provides descriptions of the strategic intelligence environment

of a non-Western country.29 According to one author, the primary purpose for this

accumulated research is to,

Provide some counterweight to the liberal democratic domination of theliterature, especially Anglo-American. Specifically…it is important todescribe and analyze a wider range and variety of national intelligencesystems in order to counter any simplistic assumptions that Anglo-

29 Peter Gill, introduction to the PSI Handbook of Global Security and Intelligence: National Approaches,vol. 1, ed. Stuart Farson et al (London and Connecticut: Praeger Security International, 2008), 1.


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American models provide a reliable guide to present or, necessarily, futurearrangements elsewhere.30

As the quote suggests, studying other intelligence systems can allow for greater self-

inspection, may result in empirical material suitable for comparison, and can counter the biases built into the CMR model.31 However, these studies are generally inconsistent in

the intelligence attributes they analyze. Some of these studies describe the internal

structure of an intelligence system, while others discuss issues relating to civilian

oversight. In short, Laqueur’s problems manifest themselves once again, only now it is

in a multi-polar world.

Some of these studies are subsections of defense sector reviews – likely a result of

their publishing venues. For instance, Anthony Cordesman and Khalid Al-Rodhan write

about the military forces of nation-states in the Persian Gulf.32 Their study reviews nine

countries, each of which includes a section titled “Paramilitary, Security, Police, and

Intelligence Forces”.33 These sections include a brief biographical background along

with limited quantitative data. Yet, many of these defense sector reviews tend to

emphasize the military aspect over the intelligence component. An example of a robust

defense review is The Middle East Military Balance: 2000-2001, edited by Shai Feldman

and Yiftah Shapir. The review gives a weapons inventory for twenty-one Middle East

countries.34 The authors provide general information about individual economic and

30

Ibid.31 This point is articulated by Peter Gill, although he does indicate what “material” can produce empiricaldata. See Peter Gill, “Knowing the Self, Knowing the Other: The Comparative Analysis of SecurityIntelligence,” in Handbook of Intelligence Studies, ed. Lock K. Johnson (London and New York:Routledge, 2007), 83.32 See Anthony Cordesman and Khalid Al-Rodhan, Gulf Military Forces in an Era of Asymmetric Wars(Connecticut: Praeger Security International, 2007).33 Ibid.34 Shai Feldman and Yiftah Shapir, eds., The Middle East Military Balance: 2000-2001 (Massachusetts:MIT Press, 2001).


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arms procurement programs for each country – only after which do they give an order-of-

battle for each military branch. Exploring countries in such a comprehensive manner

allows the authors to create international benchmarks and compare levels of military

prowess. Studies this detailed are not present in the current body of comparative studies

of intelligence.

Another example of a defense sector review with a subsection on intelligence is

Jane’s Information Group. Its Sentinel Country Risk Assessment Library attempts to

provide a comprehensive list of entities related to every nation’s security apparatus. It is

a very valuable resource for those looking to obtain quick and general information aboutthe security situation in a country. For many nations, the library is also successful in

identifying their various intelligence agencies. While the information most pertinent to

this study comes from Jane’s Sentinel Country Risk Assessment Library, the majority of

the company’s intelligence related information is in Jane’s Intelligence Review and

Intelligence Weekly – albeit in qualitative form.

While some comparative studies discuss the interaction within the described

national intelligence system, others provide a detailed account of the weapon systems in

possession of each country. Each provides a response in a narrative format. As with all

comparative studies, there is a certain measure of variance between each observed

country. According to Peter Gill, the variance in national approaches reflects the

conditions of the individual nation itself.35 In western democracies, writers tend to

describe intelligence as something in need of reform, whereas in non-western nations,

35 Peter Gill, introduction to the PSI Handbook of Global Security and Intelligence: National Approaches,vol. 1, ed. Stuart Farson et al. (London and Connecticut: Praeger Security International, 2008), 15.


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they are entities to support the ruling party.36 Nevertheless, these contributors add to the

comparative body of intelligence studies, although, they are a reflection of the qualitative

approach.

Self-Reporting Countries

One body of literature relative to this thesis consists of countries opting to publish

information about their individual intelligence organizations and programs. Although

uncommon in most of the world, self-reporting can provide a wealth of information.

Self-reporting countries can provide unique views of those within the intelligenceestablishment, as well as insight on the organization’s operations or how they interact

with top decision-makers. It gives other qualitative information about their internal

arrangements, decision-making process, and other data that is also useful for comparative

research.

Specifically, self-reporting countries are important to this thesis because they

contain budgetary and workforce data. Quantitative data is necessary to create a

benchmark and begin creating estimates in any study with unknowns. Thus, this

quantitative data allows the study to estimate unknown intelligence spending and

personnel – the explanation of this process is in Chapter 3.

There are various reasons why a country would publish its intelligence

community’s budgetary and personnel data. Some countries report their intelligence

budgets because of their own rules and regulations, generally in an attempt to provide

oversight. The US is an example of a country which requires its intelligence community

to regularly report its budget. Yet there are some drawbacks to how it reports. For

36 Ibid.


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one identified the correct number of intelligence entities, secondary sources must be

consulted.

These problems are not unique to financial matters. Indeed, similar problems

exist with sources that report on personnel. One example is Japan, which publishes a lot

of information on their intelligence establishment. However, the Land of the Rising Sun

has five distinct intelligence agencies – which apparently do not report to a single

oversight entity. The end result is that, while information exists about the employment

practices of the Japanese intelligence agencies, it becomes somewhat difficult to correctly

identify each one and find its total personnel. Nevertheless, the nations that do self-report intelligence data are valuable to this

study. While the reports are sometimes dense and qualitative, the quantitative data –

budgets and personnel figure – are like golden nuggets of information. In many cases,

reporting these figures is a matter of legality, while others report simply due to agency

practice. This body of literature, nations which opt to publish quantitative data, is far

from being universal – most are generally considered part of Western society.

Regardless, the geographical spread of self-reporting nations is worldwide.

Systematic Studies of Intelligence

Despite the lack of comprehensive quantitative research, there are two prominent

studies attempting to catalog the world’s intelligence agencies. Each study has

substantial benefits and provides a solid starting point for quantitative research.

However, each study approaches cataloging their information by using different methods.

Uniformity between these studies is certainly lacking. Before discussing them further, it


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structures its information into two broad categories, country briefings and countries

studies. For each country Henderson compares the following attributes:45

System of Government

National Intelligence Community National Security Legislation Intelligence Oversight International Intelligence Relationships Recent activities

Both categories, country studies and country briefings, contain a section of each listed

attribute. However, each country lacks completeness and uniformity in its data. For

example, Henderson’s Costa Rican country study says of intelligence oversight,

“Reportedly, there is a Legislative Assembly Committee with responsibility for

legislative review of the security and police forces”.46 This brief description includes

only the name of the legislative body and their technical area of oversight. Henderson

does not explain the historical context of the country’s intelligence oversight, officials

charged with overseeing intelligence agencies, or the source for this information. This is

a marked difference from the next country study, Estonia. For intelligence oversight,

Henderson includes the name of the oversight authorities, the historical run-up to the

current system, notable oversight figures, and the source of the information.47

While Henderson lacks uniformity in completeness of each predetermined

attribute, he effectively creates a reference guide for future studies. His goal is not to

create a methodologically correct book of case studies. Henderson wants to provide

future researchers with a starting point. As a result, many of his country studies contain

relevant information pertinent to this thesis.

45 Ibid, xi46 Robert Henderson, Brassey’s International Intelligence Yearbook: 2003 Edition (Washington DC:Brassey’s Inc, 2003), 248.47 Ibid, 258-259.


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Another study attempting to catalog the world’s intelligence agencies is a subset

of the Intelligence Resource Program (IRP), an ongoing project by the Federation of

American Scientists (FAS). This section of the IRP is dedicated toward finding and

classifying any available information on any intelligence agency.48 Each country has

information discussing their national intelligence agencies. The individual listings

generally have two sections. The first section contains documents specifically about the

intelligence agencies. For example, the IRP lists India’s three different ministries with

intelligence agencies.49 The second section contains information about sources and

background areas for future research. Looking again at the entry for India, the sourcingsection has two entries; the first is a study by Ronald Kostoff of the US Department of

the Navy, which reviews Indian defense research literature.50 The second source links to

Bharat-Rakshak, a news-like consortium with different Indian military websites

available.51 Each source provides a valuable starting place for future research.

The IRP’s website on the world’s different intelligence agencies is a repository of

information with limited analysis. It is best called a research library, not a study. Barring

countries with well-known intelligence agencies, each country entry links to either a

document on FAS’s website or to another external source. Like Henderson, the FAS’s

IRP provides resources, much like a specialized library or database.

These sources amount to correlated data and not congregate findings or

assessments. Previous qualitative methods used to describe the world’s intelligence

48 To see the IRP’s list of countries with complied information on their intelligence agencies, see John Pike,World Intelligence and Security Agencies, http://www.fas.org/irp/world/index.html.49 John Pike, India Intelligence and Security Agencies, http://www.fas.org/irp/world/india/index.html.50 Ibid. To read Kostoff’s study, see Ronald N. Kostoff, et al., Assessment of India's Research Literature,http://www.fas.org/irp/world/india/research.pdf .51 Ibid. To view Bharat-Rakshak, see Bharat-Rakshak , http://www.bharat-rakshak.com/.


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systems are relevant when looking at individual countries, and understanding other

methods to achieve civilian control over intelligence services is important. However, the

lack of quantitative studies describing intelligence communities provides an excellent

opportunity for advancement, particularly in testing Loch Johnson’s correlation between

intelligence activity and national wealth. This study’s specific goal is to quantitatively

determine the approximate size of the world’s intelligence industry, although it expects to

identify Lock’s relationship. To that end, the researcher expects the aggregated amount

spent on intelligence to near 100 billion United States Dollars (USD), and the total

number of people working within the worldwide community to be about 500,000.


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METHODOLOGY

This study uses a quantitative descriptive research design because it allows for the

classification of a sample population’s characteristics in a systematic way.52 For each

country, the study measures the following interval data – intelligence spending,

personnel, and Gross Domestic Product (GDP). This study uses the definition of GDP

given by the Bureau of Economic Analysis (BEA). The researcher collected intelligence

spending and personnel information on individual countries using open sources, primarily

from the internet. The data also comes from traditional academic sources, such as books,

journals, and conference papers. However, not all budgetary and personnel information

is readily available for every country. The study does estimate some of the intelligence

spending and personnel data. The following chapter explains the process used to identify

and estimate the different spending and personnel numbers of the world’s intelligence

industry.

This chapter also explains how the researcher collated the intelligence spending of

individual nations into standardized units, such as dollars valued at a certain year.

Quantifying the set of data allowed for cross-country comparisons. However, problems

arose when unifying the datasets and this affected the standardizing process. The last

section describes the methods used to resolve these classification problems, specifically

52 This concept and other methodological approaches are discussed in Ronald Hunter and Mark Dantzker, Research Methods for Criminology and Criminal Justice: A Primer , 2nd ed. (Boston: Jones & Bartlett,2005), 98-100,http://books.google.com/books?id=Z0sDhvGkomgC&pg=PA98&lpg=PA98&dq=descriptive+historical+design&source=bl&ots=CSla94hG0K&sig=-8ayiRuBBsQ7dp0OICv7dMOGjD8&hl=en&ei=M0whSsrLG4aHtgeK_7jCBg&sa=X&oi=book_result&ct=result&resnum=2#PPP1,M1.


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how this study dealt with the definitional inconsistencies of different personnel types,

such as full-time, part-time, and contacted employees.

Data Collection

According to the Congressional Research Service, open source information comes

from newspapers, journals, radio, television, and the internet.53 Collecting information

on intelligence spending and employment came primarily from sources on the internet.

The data also came from other sources, such as scholarly journals, trade publications, and

congressional research documents.This thesis limits the scope of collection to the 195 sovereign nation-states

recognized by the United States State Department – with the exception of the Holy See

(Vatican City). These states form the basis of the data. The Vatican is not included

because there are no GDP estimates to indicate its national wealth. Attempting to

measure this indicator would likely present a problem, as most of the Vatican’s income

comes from outside its territorial boundaries. The Vatican’s external assets and

economic activity cannot be included in a GDP estimate under the BEA’s definition of

GDP, which it says is “the value of final goods and services produced in [a country] in a

given period of time”.54 With the exception of minor goods, such as tourist mementos

and museum fees, the primary sources of income for Vatican City come from external

sources. Therefore, its GDP estimate is tricky at best to determine.

53 Congressional Research Service, “Open Source Intelligence (OSINT): Issues for Congress,” US Libraryof Congress, Order Code RL34270, December 5, 2007, http://www.fas.org/sgp/crs/intel/RL34270.pdf .54 Bureau of Economic Analysis, “Measuring the Economy: A Primer on GDP and the National Incomeand Product Accounts,” US Department of Commerce, September 2007, 2,http://www.bea.gov/national/pdf/nipa_primer.pdf .


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The list of 195 countries does not include dependencies or other areas that are not

independent nations. Excluding these areas is consistent with the US State Department’s

definitions.55 The United Nations also does not consider these territories as independent

nations, and they are not recognized as Member States.56

The agencies listed within each country are intelligence agencies. To the best of

his ability, the researcher excluded government agencies with characteristics unique to

law enforcement. In some cases, the distinction between intelligence and law

enforcement is blurred. One example is the treatment of financial intelligence units (FIU)

as members of an intelligence community. While some FIUs act as members of anation’s intelligence community, others do not. The researcher addressed this issue by

generally excluding agencies with mandates requiring them to enforce financial

regulations, compliance matters, and tax evasion – when it relates to money laundering.

In other cases, there is no distinction between intelligence and law enforcement

agencies. The researcher used the best available information to establish if such an

agency was consistent with the conceptual framework as explained in Chapter 2.

Collection from Internet Sources

The researcher used three different methods to collect relevant information from

the internet. The first method consisted of keyword and phrase searches using terms

most likely to generate results of an individual country’s intelligence spending and

personnel. Some keywords and phrases resulted in the desired information, but not all.

55 See United States State Department, Independent States in the World ,http://www.state.gov/s/inr/rls/4250.htm#note4.56 To see the list of Member-States of the United Nations, see United Nations, Member States of the United

Nations, http://www.un.org/en/members/ [accessed June 1, 2009].


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Most of the search results gave supplementary information, such as oversight committees

or annual reports about the intelligence community of a country. The most useful results

were noted for future use.

After using this initial search criterion, the researcher adjusted the terms to

specify the intelligence agencies. Adjusting the search criterion increased the precision

of the results. The process of searching initial keywords and phrases, then refining, is a

matter of trial and error. After finding the relevant information, the researcher recorded

the relevant data and year of publication. This method was applied to every country.

In the second search method, the researcher utilized online journals and websiteswith dedicated sections on intelligence. Journals like the International Journal of

Intelligence and Counterintelligence, the Defense Intelligence Journal, and the

Intelligence and National Security Journal, provided some keywords and phrases for

future use. While some of the journals are available print, many more are available on

the internet. Additionally, their online versions tended to be more suitable, as they are

easier to conduct keyword searches.

The researcher searched these journals in a very systematic manner, where the

most recent editions’ articles were examined for relevant information. The only articles

searched had descriptions about intelligence agencies or communities – however, the

journal article titles provided most of the information necessary to determine if they

contained any relevant information. After recording the relevant data and citation from

the journal publication, the researcher continued on to the previous journal edition,

searching through it for relevant information. Each scholarly journal received this

process.


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be published from time to time”.58 In practice however, the publication of this

information does not occur on a set schedule, but rather infrequently.59 Nevertheless,

when self-reporting does exist it is generally attainable through government websites.

The researcher used a systematic search approach similar to the method used for online

publishers, in order to gather this information.

In the third method, the researcher used “Google Alerts,” a free “push” service

from Google.com. The researcher created a generic Boolean search criterion and set it at

the comprehensive collection level. This setting covers news, blogs, and videos.

However, using Google Alerts requires the user to first identify terms likely to produceresults. The researcher first identified the names of a particular country’s intelligence

agencies, generally both in English and the native language. After identifying these

agencies, the researcher entered their various names into the Google Alert search field

using Boolean format. The reporting of these results generally occurred on a daily basis.

In order to assist the translating of non-English results found by these three search

methods, the researcher used the website FreeTranslation.com. The owner of this

website is a service company that provides language translation software to global

corporations.60 FreeTranslation.com has two useful features: first, it has a single word

translator. The user inputs the text from the original language and selects the language of

the translation. Second, it has an entire webpage translator, where, the user inputs the

Uniform Resource Locator (URL) and then FreeTranslation.com coverts it from the

originating language to the desired language.

58 “The Constitution of the United States,” Article I, Section 9, Clause 7.59 Congressional Research Service, “Intelligence Spending: Public Disclosure Issues,” US Library of Congress, Order Code 94-261, Updated February 15, 2007, 2, http://www.fas.org/sgp/crs/intel/94-261.pdf .60 SLD, Company Profile, http://www.sdl.com/en/company/company/.


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Despite the benefits provided from using FreeTranslation.com, the website does

not have a comprehensive list of languages. The text translator can only translate into

English from the following languages: Spanish, French, German, Italian, Dutch,

Portuguese, Russian, and Japanese. A similar restriction applies to their webpage

translator. The webpage translator can only translate to English: Spanish, French,

German, Italian, Dutch, and Portuguese. FreeTranslation.com also does not translate

Portable Document Format (PDFs) – a rather large drawback. Despite these limitations,

the service did assist in researching general information about foreign intelligence

agencies.

Collection from Other Sources

Data collected also came from other sources not previously mentioned. These

sources include journals not online, trade publications, and congressional documents.

The most common way in which the researcher identified these resources was cited

footnotes in other sources. Throughout the data collection process, the researcher

continually checked the sourcing of relevant data, which not only provided more

resources, but also allowed the researcher to better gauge the information’s reliability and

credibility. For example, one document from the Congressional Research Service

document gave Spain’s intelligence spending for 2006.61 The report’s authors cite

discussions with Spanish officials as the source of this information. Checking the

sourcing also led the researcher to further research that sometimes yielded more relevant

61 Congressional Research Service, "European Approaches to Homeland Security and Counterterrorism,"US Library of Congress, Order Code RL33573, July 24, 2006, 34,http://www.fas.org/sgp/crs/homesec/RL33573.pdf .


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data. A footnote may contain a book, report, or other primary source publications, which

can led to other relevant studies.

Other Relevant Information Collection

In addition to collecting information on intelligence spending and personnel, the

researcher also identified the corresponding year of the published data, and GDPs of the

individual countries. The purpose of citing the year of publication and the GDPs of

individual countries is to assist in comparing and estimating unknown datasets. The GDP

figures come from the International Monetary Fund (IMF), which was chosen for itsconsistent reporting periods. Also included are the names of the national intelligence

agencies, indicated intelligence community, or intelligence spending program. The

names of the intelligence agencies are not necessarily relevant to this study, but they are

available for reference purposes only. The researcher used Microsoft Excel to collate this

information in one single spreadsheet. Under each country listing is the name of an

intelligence agency and its corresponding budgetary and personnel data. However, if the

only information found represented the national intelligence community or spending

program, then it is indicated, and not necessarily each agency.

Establishing Webpage Credibility

This thesis uses Dax Norman’s Trust Evaluation Worksheet to estimate the

credibility of online sources. This Worksheet comes from Norman’s study, How to

Identify Credible Sources on the Web, in which he seeks to determine a “valid criteria for


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evaluating the credibility of open source Web sites”.62 It is the first quantitative study

which aims to create a methodologically sound criterion for establishing a website’s

credibility, while targeting its use for open-source analysts. Previous studies either

addressed the issue as tangent to a larger study or were methodologically flawed.

According to Norman, there are several factors to consider when determining the

credibility of a website; corroboration is the most influential criterion.63 The worksheet

applies only to websites and not to online editions of journals or other primarily

hardcover sources. Each online source has a credibility rating recorded with its citation.

The purpose of tracking credibility is incidental to this study – it merely provides acritique to non-peer reviewed sources.

Process for Estimating Unknown Spending

This thesis uses a three step process for estimating the unknown intelligence

spending of an individual country. In short, the researcher created a ratio using the

known intelligence spending and GDP from countries with the available information.

Once identifying each individual ratio for countries with known intelligence spending,

the researcher created an average of all the ratios. By using this averaged ratio, the study

identified the unknown intelligence spending for the remaining countries. GDP acts as

the independent variable, while intelligence spending represents the dependent variable.

GDP is independent because it represents national wealth – the variable that influences

the country’s intelligence spending. The following three steps explain how the study

62 Dax Norman, "How to Identify Credible Sources on The Web,," (Master's Thesis, Joint MilitaryIntelligence College, December 2001), viii, http://daxrnorman.googlepages.com/5-CompleteThesis-May08.pdf .63 Dax Norman, “Websites You Can Trust,” American Libraries 37, no. 7 (2006), 36,http://daxrnorman.googlepages.com/WebSitesYouCanTrust-Oct08.pdf .


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unknown personnel, as the estimated figure relies on intelligence spending. The

individual steps in the process are:

Step 1: Identify the two most similar countries on the basis of reported intelligence

spending. These two countries must have both reported spending and personnel. One

country must have a lower level of reported intelligence spending than the country with

unknown personnel. The other country must have higher reported intelligence spending

than the country with unknown personnel.

Step 2: The country with the lower reported intelligence spending and personnel is set as

the low range, while the other country with reported intelligence spending and personnelis set as the high range. The country with unreported personnel must fall somewhere in

between the high and low ranges.

Step 3: Average the personnel for both the high and low ranges. This results in a ratio of

the two ranges.

Step 4: Apply this ratio to the country with unknown personnel.

There are also countries with neither reported intelligence spending nor personnel.

For these countries, the researcher used the previously described process to estimate

intelligence spending. This included each of the three steps, where estimates use a

general ratio based on GDP. After estimating the country’s intelligence spending, finding

its personnel is a matter of following the pre-described four step process.

Standardizing Spending Units

The information for each country’s intelligence spending often came from

different periods in time and in different currencies. In order to standardize the monetary


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units, the researcher converted the amounts from the originating currency to US Dollars

(USD). After converting the units, the amount still remained in the reported year. In

order to unify the estimated amounts into a single year, the study uses 2008 used as a

baseline year. To convert the original currency to USD, the researcher used the website

Oanda.com. This website provides free “Internet-based forex trading and currency

information services”.64 The advantage of using Oanda.com is that it allows the user to

convert currencies using previous rates. The user can determine the desired amount

currency to convert, set the rate used, and then pick the expressed currency.65

Standardizing Personnel Definitions

While the currency data may differ, personnel information suffers from

conflicting definitions. Some sources include only full-time employees, while others

include contract-based personnel. For example, the Canadian Security Intelligence

Service reports its total as the number of full-time equivalent employees.66 However, the

US includes approximately 56,000 contractors with its total intelligence personnel.67 In

order to come to terms with the differences in classification, the researcher only included

full-time equivalent employees directly employed by the government agency. In most

situations, the reported figure did not further divide personnel into separate categories.

The researcher accepted these figures as full-time equivalents.

64 OANDA, About OANDA, http://www.oanda.com/site/oanda/com_index.shtml.65 OANDA, “FXConverter - Currency Converter for 164 Currencies,”http://www.oanda.com/convert/classic.66 Canadian Security Intelligence Service, “Public Report 2006-2007,” Canadian Security IntelligenceService (Gatineau: Public Works and Government Services, 2007), 15, http://www.csis-scrs.gc.ca/pblctns/nnlrprt/2006/rprt2006-eng.pdf .67Office of the Director of National Intelligence, 2009 National Intelligence Strategy, September 15, 2009,http://www.fas.org/irp/news/2009/09/dni091509-m.pdf .


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RESULTS

Research into the approximate size of the world’s intelligence industry produced a

number of interesting results. This chapter will give the overall findings produced by the

methods described in Chapter 3. This chapter’s first section will discuss the patterns of

intelligence spending, while the second section will describe the workforce of the

intelligence industry. The third section will give a brief narrative description of the

identified intelligence agencies. The fourth and final section will provide a summary of

the results.

The Totals: Spending

Using the described methods, this study identifies that the world’s intelligence

industry spends an estimated

$106,961,604,308.01 United States

Dollars (USD) on an annual basis. The

relationship between intelligence

spending and Gross Domestic Product

(GDP) is positive, where for every 947

units of GDP there are two units of

intelligence spending. The United States

spends the most on intelligence. As shown in Figure 4.1, the US spends about $75 billion

dollars, approximately 65 percent of the total amount. According to statistics from the

International Monetary Fund (IMF), the US’s GDP represents only 23.5 percent of the

US

Intelligence

Spending:

$75 Billion

65%

WorldIntelligence

Spending:

$31.96

Billion

35%

Figure 4.1: Total World Intelligence

Spending

Total Spending: $106,961,604,308.01


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However, excluding the US when measuring variation produces an average of

$248,494,801.33.

The other 175 nations, or the bottom 90 percent, spend the remaining seven

percent of the total intelligence figure, or $7,453,907,456.88. These countries have a

total GDP of $12,819,519,999,996, comprising about 31.12 percent of the world’s 2008

GDP.71 When comparing this population’s proportion of intelligence spending to its

proportion of GDP, it again demonstrates unevenness. The bottom 90 percent of

intelligence spenders is similar to the bottom 90 percent of countries with the lowest

GDP. The average intelligence spending for these countries is $42,593,756.90.A bar graph is perhaps the best method for displaying the spread of intelligence

spending by each country. The graph in Figure 4.3 shows countries sorted by intelligence

spending. The countries most close to the y-axis have the highest intelligence spending,

while the countries farthest away, along the x-axis, have the lowest intelligence spending.

For the purpose of increasing clarity, numbers are in place of country names. Appendix

B: Intelligence Spending Sorted Highest to Lowest has a list of each number’s

corresponding country, along with their individual intelligence spending. Additionally,

the y-axis in Figure 4.3 is set as logarithmic – its scale increasing by the power 10 – in

order to improve the visual display of the data.

There are two trend lines that seem to be the best fit for the data, power and

exponential. The first line is solid black and represents the exponential trend line. The

second line is a dotted black, representing the power trend line. The solid black trend line

71See International Monetary Fund, World Economic Outlook Database, World Economic Outlook Database, April 2009,http://www.imf.org/external/pubs/ft/weo/2009/01/weodata/weorept.aspx?sy=2008&ey=2008&scsm=1&ssd=1&sort=country&ds=.&br=1&c=001%2C998&s=NGDPD&grp=1&a=1&pr.x=27&pr.y=8.


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increases steadily upward from right to left. Given the logarithmic scaling, this

movement is consistent with what one expects from data which is exponential. The

dotted black trend line increases right to left in a similar way, however, there is a steady

curve that eventually hooks sharply upwards as it nears the y-axis. The researcher

computed the R-Squared (R 2) values – which measures how well a trend line will match

with the data – in order to assist in analyzing the trend lines. The R 2 value for the

exponential trend line is 0.940 and the R 2 value for the power trend line is 0.835. It is

likely that the dataset, the individual intelligence spending, follows slightly more of an

exponential curve rather than a curve that obeys a power law. Nevertheless, the proximity of the two R 2 values to one another is notable, as it indicates that the dataset

may still follow a power law. Further research into identifying the minimum x (Xmin) and

the maximum likelihood estimator (MLE) is necessary. This step is necessary to

determine the approximated scaling exponent of the curve, if indeed it does follow a

power law curve. After finding the scaling exponent, it ought to be relatively simple to

accurately say this data does or does not follow a power law curve.

One interesting finding of this study is the difference the US has on deriving

statistical information from the data. For instance, including the US in estimating the

mean amount spent on intelligence results in an average of $548,521,047.73. However,

without the US the average drops dramatically, to $164,750,537.67. The standard

deviation with the US is $5,389,872,754.45, without the US it is $576,959,565.88. The

differences in the two means and standard deviations are noteworthy. On one hand, this

information suggests that the US is an outlier and it should not be included when

calculating this statistical information. On the other hand, the US appears to play a very


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Table 4.1: Affect of US on Estimating

Population(US Included)

Population(US Excluded)

Average Spending $548,521,047.73 $164,750,537.67

Standard Deviation $5,389,872,754.45 $576,959,565.88

Ratios for Estimating 2/947 1/442

Percent Difference of Estimates 5.22%

As for the countries that comprise the top ten percent of intelligence spenders,

obvious nations – such as the US, UK, and Russia – are on the list. However, it is

surprising to see the nations not on the top ten percent list. If GDP is the primary

indicator of intelligence spending, then Spain would most certainly make the list with its

1.2 trillion dollar economy.72 Yet sources indicate that it spends about $200,000,000, an

amount far lower than Venezuela, which is part of the top ten percent. A direct

correlation between GDP and intelligence spending may exist, but it is not strongly

indicated here. It is apparent that GDP is a factor when it comes to intelligence spending

but it does not seem to be the primary factor. Further research is necessary to quantify

GDP’s affect on intelligence spending.

72 See Spain’s 2005 GDP at International Monetary Fund, World Economic Outlook Database, World Economic Outlook Database, http://www.imf.org/external/pubs/ft/weo/2009/01/weodata/index.aspx.


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US144,000

13%

Russia

172,000

15%

World

814,104

72%

The Totals: Personnel

This study identifies the total number of people working in the intelligence

industry as 1,130,104 persons. The two largest employers are the US and Russia who, as

shown in Figure 4.4, jointly employ approximately 28 percent of the total. All other

things being equal, it is logical to assume that because the US spends the most on

intelligence, that it should also employ the most people. However, it employs about

28,000 less than Russia. The US does

employ approximately 56,000

intelligence contractors, however.

73

Including them into the calculations

would increase the US’s share, but the

definitions given previously in this

study prohibit non-government workers

from being counted. Regardless, the

US employs about 144,000 people,

resulting in roughly $520,833 in

intelligence spending per person. Its GDP per person is about $99,059,722.

For Russia, its total number of workers is about 172,000, making it the world’s

largest employer of intelligence professionals.74 Although Russia may employ the most

people, it does not come nearly as close as spending the most money. Russia has about

73 Office of the Director of National Intelligence, 2009 National Intelligence Strategy, September 15, 2009,http://www.fas.org/irp/news/2009/09/dni091509-m.pdf . Although the total number given by the ODNI is200,000, previous interviews indicate that in 2008 the US's intelligence community employed 28 percent of its workforce as contractors. After removing contractors, 56,000, the remaining number of employees isabout 144,000. See Joseph Fitsanakis, "US Spy Services Hiding True Employee Numbers Says SenatePanel," IntelNews.org, July 27, 2009, http://intelligencenews.wordpress.com/2009/07/27/01-195/.74 Ivan Safranchuk, “Funding for the Russian Secret Services," Agentura.ru,http://www.agentura.ru/english/experts/safranchuk/.

Total Employment: 1,130,104

Figure 4.4: Total Intelligence Employment


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$18,902.70 in intelligence spending per person – a figure substantially lower than its

American counterpart. This difference is also present when using GDP to calculate a per

person figure, which is $5,752,488. Obviously there are other factors working into the

equation. Given the small scope of this study, the finding here is that there are some

differences in employment practices.

Using the best information available, this thesis finds 21 countries that employ

10,000 or more people. They employ about 61 percent of the world’s total intelligence

workforce, or 689,428 people. As shown in Figure 4.5, the 21 countries come from

various regions around the world – however, some countries listed, such as Camroon andAlgeria, have estimated personnel. The researcher based these estimates on the best

available information and the methods outlined in Chapter 3. The total intelligence

employment of these countries varies, as seen in Figure 4.6. While the US has the

highest intelligence spending per person, $520,833.33, the United Kingdom has the

highest GDP per person, at $229,787,213.11. Panama has the lowest intelligence

spending per person, $1,465.79, and Syria has the lowest GDP per person, $1,567,200.

One interesting country on the list of top intelligence employers is China. China

is third largest intelligence employer in the world with an estimated workforce of 88,050

people, a figure representing about 7.79 percent of the world’s total intelligence industry.

Yet China’s intelligence spending per person is $46,755.19 – 40.42 percent higher than

Russia. Figure 4.7 compares the amounts spent per person by China, Russia, and the

world’s average. Taken at face value, China’s spending per employee is clearly more

consistent with the world average when compared with Russia. China employs less

people but spends more per person than its Russian counterpart.


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0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

B a n g l a d e s h

C a m e r o o n

I r a q

P a k i s t a n

P a n

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Figure 4.6: Top 21 Intelligence Employers

Country

P e o p l e

Figure 4.5: Geographic Position of Top Intelligence Employers

= Top Intelligence Employers

Source: Trevor Coultart, World Geography Ignorance,

http://trevorcoultart.wordpress.com/2008/05/26/world-geography-ignorance/. The grey shading and

color alterations are the work of this researcher.

http://trevorcoultart.wordpress.com/2008/05/26/world-geography-ignorance/http://trevorcoultart.wordpress.com/2008/05/26/world-geography-ignorance/


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Figure 4.7 also says something about Russia. One of three scenarios is likely:

Russia’s identified intelligence spending is grossly inaccurate, the country values

intelligence less than the rest of the world, or the country has drastically different hiring

practices than its peers.

The remaining 90 percent of employers comprise 174 countries, representing 39

percent of the world’s total intelligence workforce, or 440,676 people – shown in Figure

4.8. The average number of persons employed by any given country is 2,533, with a

standard deviation of 2,709. Australia spends the most on its intelligence professionals,

about $1,273,174.83 per person. However, this figure may result from problems with

collection. The country with the second highest intelligence spending per person is

Japan, which spends approximately $1,123,208.36 per employee. Japan’s spending per

person estimate is likely more accurate due to the completeness in data collected on its

workforce. In arguing the correctness of its estimate, this thesis is also arguing that Japan

$0.00

$10,000.00

$20,000.00

$30,000.00

$40,000.00

$50,000.00

$60,000.00

I n t e l l i g e n c e S p e n d i n

g P e r P e r s o n

C h i n a

R u s s i a

W o r l d

A v e r a g e

Figure 4.7: Comparing Intelligence Spending Per Person


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has the highest intellige

total comes from the Mi

spending is an estimate.

One interesting fi

approximately 60 perce

employ 10,000 or more

intelligence spenders. O

on the list of top intellige

the assumption that a relyet it does not. Most co

system, as shown in Fi

countries that employ m

to cluster around employ

T

E

ce spending per person in the world. Infor

istry of Defense’s National Institute for Defen

ding is the diversity in intelligence spending p

t of the world’s intelligence workforce is

persons, these nations are not necessarily the

nly six countries with the highest intelligence

nce employers – as shown in Figure 4.9. The d

tionship exists between intelligence spendingntries employ between 0 and 2,000 persons in

ure 4.10. There are also notable decreases i

re than 6,000 persons and then again at 14,000.

ent levels between 0-6,000, and then 8,000-14

Total Employment

op Ten Percent

Employment 689,428

Bottom 90

Percent

mployment440,676

0

200,000

400,000

600,000

800,000

1,000,000

1,200,000

Figure 4.8: Bottom 90 PercentEmployment vs. Top Ten Percent

Employment

44

ation on Japan’s

e Studies, but its

er person. While

n countries that

same as the top

pending are also

ata should reflect

nd employment,their intelligence

n the number of

Countries seem

,000.


54/130


55/130

46

Other Extracted Results

Research of the 195 sovereign nations identified 246 different national

intelligence agencies.75 Based on the best available information, this list does not include

agencies involved in law enforcement. The average number of intelligence agencies per

country is 1.28. Most of these agencies seem to focus on military or political-strategic

target sets rather than operating and maintaining technological systems. The average

credibility rating for internet sources is 38.56, or somewhere between the medium and

high ranges of Dax Norman’s Trust Evaluation Worksheet . Before elaborating further on

credibility, the following paragraphs will discuss the exclusion of certain financial“intelligence agencies”.

The 246 different agencies identified by this study generally do not include ones

that specialize in, what they list as, “financial intelligence”. The by and large exclusion

of these agencies is due to inconsistent descriptions of their duties, as briefly discussed in

the methodology. For instance, the Canadian Financial Transaction and Reports Analysis

Centre (FINTRAC) says a primary function is to counter terrorist financing,76 while its

mandate requires the agency to “provide law enforcement financial intelligence that

would be relevant to the investigation or prosecution of money laundering offences and

terrorist activity financing offences as well as to provide CSIS [the Canadian Security

75 The figure does not include intelligence agencies of the United States. This is because the intelligence

spending of the US is expressed in its budgetary account form, that is, the National Intelligence Program(NIP) or the Military Intelligence Program. The same is true for the United Kingdom which expresses itsintelligence spending via the Single Intelligence Account (SIA). There is some question as whether or notthe Defense Intelligence Staff includes its budget within the SIA – the figure within this study appears toinclude it. For referencing on the SIA, see Intelligence and Security Committee, "Annual Report 2007-2008," Parliament of the United Kingdom, ISC 2008/09/064, 8, http://www.fas.org/irp/world/uk/isc2007-08.pdf .76 To view a FINTRAC’s 2008 Annual Report on its duties, functions, and activities, see FinancialTransactions and Reports Analysis Centre of Canada, FINTRAC Annual Report 2008 (Ottawa: 2008), 22,http://www.fintrac-canafe.gc.ca/publications/ar/2008/ar-eng.pdf .


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47

and Intelligence Service is the country’s foreign intelligence agency] with financial

intelligence that would be relevant threats to the security of Canada”.77 FINTRAC is an

intelligence agency that participates in collection and analysis, and interacts with the

Canadian intelligence system. Another example is the Saudi Arabian Financial

Investigation Unit, whose first priority is to “handle suspicious financial transactions,

analyze them and prepare reports thereon to submit them to the competent

authorities…and exchanges information with the relevant agencies in Saudi Arabia and

abroad”.78 Despite using the term “investigation” in its title, the entity is Saudi Arabia’s

official financial intelligence unit.

79

These agencies differ from that of the Bahamas’Financial Intelligence Unit, which says it is “The Bahamas’ regulator for anti-money

laundering and prevention of the financing of terrorism”.80 While the unit’s realm of

specialty includes preventing terrorism financing, the definition given here, along with

the Financial Intelligence Unit Act of 2000, clearly describes itself as a regulatory entity

and not an intelligence agency.81 The Bahamas’ description of its Financial Intelligence

77 Financial Transactions and Reports Analysis Centre of Canada, Who We Are, http://www.fintrac-canafe.gc.ca/fintrac-canafe/1-eng.asp [accessed May 30, 2009].78 Kingdom of Saudi Arabia Financial Investigation Unit, Background ,http://www.moi.gov.sa/wps/portal/safiu/!ut/p/c1/04_SB8K8xLLM9MSSzPy8xBz9CP0os3hT5wBnTwtfY0 N3ZxNnA08TwzCDYGdTY6MAE6B8JJK8gamTs4FRmJ-zaVBIgIGboykB3cGpefrhIDtxq7I0RpPHYgdI3gAHcDTQ9_PIz03VL8iNqPDMMlEEACELTPE!/dl2/d1/L0lDU0lKSWdra0EhIS9JTlJBQUlpQ2dBek15cUEhL1lCSkoxTkExTkk1MC13ISEvN181Q1BDSThNMzE4NkU0MEk0NUpNNktFMkMyMQ!!/?WCM_PORTLET=PC_7_5CPCI8M3186E40I45JM6KE2C21_WCM&WCM_GLOBAL_CONTEXT=/wps/wcm/connect/main/Financial+Investigation/Main/Background/

[accessed November 17, 2009]79 The Egmont Group, List of Members, http://www.egmontgroup.org/about/list-of-members/by-region/asia[accessed November 17, 2009].80 Commonwealth of The Bahamas, Welcome to FIU Bahamas,http://www.bahamas.gov.bs/bahamasweb2/home.nsf/vContentW/A4AE9BF530DECF23852572C600580BD7.81 See An Act to Provide for the Establishment of a Body to be Known As the Financial Intelligence Unit ,the Functions and Powers of That Body, a

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A Study Into the Size of the World s Intelligence Industry

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