By William Drozdiak
Washington Post Foreign Service
Monday, July 24, 2000

BAD AIBLING, Germany –– Looking like a set of gigantic golf balls, the high-powered listening post operated by the U.S. National Security Agency in this picturesque village 40 miles south of Munich was long regarded as one of the West's most formidable assets during the Cold War.

The Bad Aibling station's vast array of parabolic antennas and satellite communications gear could monitor Soviet Bloc troops in such extraordinary detail that, as one veteran intelligence agent put it, "we could hear their teeth chattering in Ukraine."

But now that the Soviet military threat is a thing of the past, some Germans are asking why the NSA continues to maintain its most elaborate foreign eavesdropping facility in their back yard. The answer, contends a growing collection of critics: The "big ears" at Bad Aibling are conducting economic espionage against Europe.

The United States denies that, saying it never passes intercepted information to U.S. companies. Yet Europeans note that officials in Washington have acknowledged that U.S. intelligence data about possible bribery figured in Saudi Arabia's decision to cancel a big airliner contract with Airbus Industrie of Europe. The order eventually went to Airbus's U.S. competitor, the Boeing Co.

"It's amazing that we still put up with this kind of thing," said Else Huber, a Green party activist who organized a town meeting in May to challenge the presence of the U.S. listening post. "There is a lot of discomfort about what the Americans are doing, but every now and then they throw a party to keep the locals happy. The fact they are still here watching over us 10 years after the collapse of the Soviet empire is a crying shame."

Two weeks ago, reflecting growing mistrust on the issue, the European Parliament voted to open an investigation into whether the United States is spying on European businesses.

A committee was appointed to scrutinize the so-called Echelon spy system, which intelligence specialists say can intercept billions of telephone calls, e-mails and faxes every hour in all corners of the globe. The network is said to be operated by the United States in conjunction with Britain, Canada, Australia and New Zealand and to work like a powerful Internet search engine, targeting key words, voices or other data gleaned from listening posts, such as Bad Aibling.

"I don't know what they think they're investigating or where they intend to proceed," State Department spokesman Richard Boucher said of the European probe. "The notion that we collect intelligence in order to promote American business is simply wrong."

At a recent public hearing of the Senate intelligence committee, Lt. Gen. Michael Hayden, the NSA director, said the agency has trained its vast resources on gathering information about terrorism, weapons proliferation, money laundering and corporate corruption. He denied that any of that data were passed to U.S. companies or that reports of illegal behavior were handled between governments.

R. James Woolsey, director of the Central Intelligence Agency from 1993 to 1995, said at a recent Council on Foreign Relations seminar that it would be "madness" for the U.S. government to become entangled in deciding what companies should benefit from espionage activity. But he said there are instances in which corruption discovered through surreptitious means must be brought to light.

"You collect intelligence on bribery by some of our friends abroad who like to win contracts through bribery, and then you tell the U.S. government so it can try to get the other government not to award the contract on the basis of bribery," Woolsey said. "But you don't go to the American corporation and say, 'Hey, you're about to lose because some of our friends are bribing the president of the country in question.' "

The United States followed that prescription in 1994 by urging Saudi Arabia to break a $6 billion deal for passenger jets with Airbus after U.S. intelligence passed along evidence of bribes, Clinton administration officials have acknowledged. The contract was awarded to Boeing, Airbus's main rival.

Similarly, the French firm Thomson-CSF lost a major weapons contract to an American rival, Raytheon Co., when the United States provided Brazil with details of corruption picked up through eavesdropping.

Those moves infuriated the French government, which has been urging Germany and Britain to shut key NSA listening posts in Europe, including Bad Aibling and two sites in England. French Justice Minister Elisabeth Guigou said Europe must become "particularly vigilant" because such U.S.-run facilities have clearly "been diverted toward economic espionage and the surveillance of competitors."

Both Germany and Britain have dismissed the French demand, saying they accept at face value the American position that no economic espionage is taking place against friendly partners. "France's argument does not carry much weight, especially because the French themselves are well known for commercial spying activity against neighbors and allies," said a senior German diplomat.

What irks the German government, however, is Washington's continuing refusal to reduce its Cold War intelligence apparatus to a scale commensurate with modern threats. A German cabinet member said a recent government study concluded there are probably 12,000 American intelligence agents still active in Germany--down from a Cold War peak of about 20,000.

In Bad Aibling, where Americans working at the NSA facility account for about one-tenth of the population of 16,000, relations between the two communities remain friendly if guarded. "It would be a terrible economic blow if the Americans left," said the mayor, Felix Schwaller. "They pay their rent, they spend a lot of money in our stores, and besides, they throw good barbecue parties."

Their workplace stands in a wooded area outside town, protected by barbed wire fences and concrete barriers at the front gate. Officials at the facility refused to comment for this article.

Schwaller and others say they can understand how the German government may feel a need to control the eavesdropping of the American "Big Brother." Many people here are struggling with nagging fears--whether real or imagined--that their faxes, phone calls and e-mails are monitored.

"This is the biggest eavesdropping operation of all time. It has no time limits, has not been ordered by any judge and is not controlled by our own government," said Bernd Kretschmann, a Green party politician. "Sometimes people even hear American voices in the background when they are having a telephone conversation. Lately, the problem has gotten better because they have no doubt improved the system."

Erich Schmidt-Eenboom, head of a research institute for peace studies in nearby Weilheim, said he has tried to soothe local nerves by arguing that the Americans must have better things to do than to listen to their conversations or sift through their e-mail.

"The Americans have told us on several occasions that they are not interested in spying against us, but that they are mainly [interested] in picking up signals about money-laundering activities in Switzerland and Liechtenstein," he said. "I guess that's a legitimate target--just so long as they don't start looking into our own bank accounts."