The White House finally succeeded in 1972 in creating a private police force in the form of the Office of Drug Abuse Law Enforcement. The office reported directly to the president through its head, Myles Ambrose, who simultaneously served as special consultant to the president. ODALE bypassed most of the traditional bureaucratic restraints on its operations; nevertheless, the plan to utilize the intelligence assets of the Central Intelligence Agency was stymied by the opposition of career officials at the Department of Justice and at CIA. This, however, was only a temporary setback. The power struggle at the FBI to succeed J. Edgar Hoover provided the White House strategists with an opportunity to take over at least part of the domestic-intelligence operation at the FBI by playing on the ambitions of its associate director, William C. Sullivan.

During the Johnson administration Sullivan had designed the FBI's counterintelligence program, which among other things harassed Martin Luther King and civil rights organizations and which gave the Nixon White House some leverage over him. In the early years of the Nixon administration he realized that his rise to power in the FBI was being blocked by Cartha "Deke" DeLoach, who was third in command at the FBI. In light of this opposition Sullivan could succeed Hoover only if he was the personal candidate of President Nixon. He thus went to great lengths, according to his associates in the FBI, "to play ball with the White House." He worked with John Dean on drafting the ill-fated Huston Plan, even though Hoover and the FBI executives opposed it. And when the White House wanted to wiretap members of the National Security Council staff and journalists, Sullivan arranged for the FBI to undertake these "national security" tasks for the president. The procedures for the FBI required that such White House requests be routed through the office of Deke DeLoach and Inspector George Quinn, but Sullivan arranged it so that the White House requests would be processed personally by him, and both DeLoach and Quinn would not have direct knowledge of the very unorthodox wiretap operations requested by the White House. DeLoach feared that this arrangement would effectively give the White House control over Sullivan's domestic-intelligence division and demanded that Sullivan return to the more normal procedures of the bureau. Sullivan, who was now working closely with such White House strategists as John Dean, then an assistant to Attorney General Mitchell, and Robert Mardian, the head of the Department of Justice's internal-security division, managed to get Henry Kissinger and Alexander Haig to intervene directly and write memoranda which supported the special arrangement between Sullivan's division and the White House. In the wake of these memoranda Hoover acquiesced and permitted Sullivan to limit the access to the transcripts and authorizations of wiretaps to a few highly placed officials in the domestic-intelligence division, which excluded DeLoach.

In effect, then, Mardian, Dean, and Sullivan controlled a bureau within a bureau which could install "national security" wiretaps for the president. When the White House strategists feared that Hoover might attempt to use the transcripts of these wiretaps to blackmail the White House, Mardian arranged through Sullivan to transfer them from the FBI to John Ehrlichman's safe in the White House. When Hoover found out about this maneuver, he locked Sullivan out of the office (by having his locks changed while he was on vacation). Realizing that his days with the FBI were numbered, and believing that the present administration of the FBI had become inefficient, if not corrupt, Sullivan pressed Dean and Mardian to create another domestic-intelligence unit. Dean fully realized that the White House could use this ambition of Sullivan's for its own purpose. He later explained to the president, "What Bill Sullivan's desire in life is, is to set up a domestic national security intelligence system, a White House program. He says we are deficient. He says we have never been efficient, because Hoover lost his guts several years ago." The problem was simply to find a cover under which such a White House intelligence system could be created for Sullivan. The war on heroin conveniently served this purpose.

The idea of creating a small intelligence unit as part of the White House's narcotics program was first suggested by Egil Krogh in the summer of 1971. Krogh explained to his staff assistants working on the narcotics problem at the Domestic Council that the only organization in the government capable of "tracking the narcotics traffickers" was the CIA, but that agency was reluctant to become involved in a law-enforcement problem. Walter Minnick, a young Harvard Business School graduate who had joined Krogh's staff only two months before, recalled that Krogh complained to him that the CIA was the most "bureaucratically closed" organization in the government, and that in order to cut the "red tape," Krogh instructed him to speak to E. Howard Hunt. (Minnick did not know at that time that Hunt was also working in room 16 as one of the Plumbers in the special-investigations unit.) Krogh's young staff assistant soon found Hunt to be extremely well informed not only about the narcotics trade in Southeast Asia but also about the bureaucratic politics of the CIA. Hunt authoritatively told Minnick that it would be next to impossible "to crank CIA intelligence" into other federal agencies, since CIA employees would be extremely wary about trusting their counterparts at BNDD or at Customs. Instead Hunt recommended establishing a new unit, under tight White House control, which could serve as a liaison between all the law-enforcement agencies involved in suppressing narcotics. He said that he knew key CIA officers who could be temporarily detached from the agency and employed in this new liaison group. Krogh subsequently explained that Hunt had "counseled me in 1971 as to specifically how we should build into the CIA operations narcotics control as an important priority; and he described the priority list which [CIA] station chiefs maintained for their own agent activity...." According to Krogh, Hunt further convinced him that unless he was able "to communicate directly with [CIA) station chiefs and have that backed up at their regional level in the CIA that, while they may say that they are cooperating, in fact [we] would not get much work on the problem at that regional level."

Specifically, Hunt suggested Colonel Lucien Conein, a personal friend of his who had served with the CIA since 1954, as a possible director for the proposed White House intelligence office. It was subsequently decided, however, that Conein would be more useful in the strategic-intelligence office of the BNDD, where he would be in a position to keep an eye on Ingersoll's activities (and there he could supervise the plans approved by the president for clandestine law enforcement abroad, which possibly would include assassination). Since Conein was unavailable to head the new office, Walter Minnick proposed James Ludlum, who had been a CIA official responsible for collecting intelligence on the international heroin trade. Krogh approved this choice because, as he told me years later, "After they had assigned Jim Ludlum to be the liaison in narcotics control, the CIA cooperation increased terrifically ... and he was a very helpful person." The White House, however, had other plans for this new Office of National Narcotics Intelligence (ONNI). To Minnick's dismay, Ehrlichman ordered him to offer the new position to Sullivan, who promptly accepted it. Krogh later explained to Minnick that this was done in return for Sullivan's cooperation in doing "previous favors for the White House." Although the implementation of ONNI was delayed until August, 1972, by the protests of Ingersoll and Kleindienst—and finally had to be located in the Department of Justice rather than in the White House, to at least partly satisfy the strong objections—Sullivan had finally gained control of the domestic-intelligence system, which John Dean presumed to be his "life's desire."

Sullivan immediately chose Russell Asch, a deputy of the National Security Council with contacts in the intelligence community, as his deputy. He also appointed liaisons with the CIA, the FBI, the Defense Intelligence Agency, and a host of the lesser-known intelligence agencies scattered throughout the government. In all, twenty-four liaisons were appointed to assist Sullivan in his intelligence coordination. The CIA agents reassigned to this new office could not entirely resist the temptation of resorting to the sort of fun and games which they practiced in the CIA. For example, one former analyst at the Office of National Narcotics Intelligence recalled that some of these former CIA agents began working on a plan for disrupting the cocaine market in the United States "by poisoning it with methedrene," a domestically manufactured stimulant that could be made to resemble cocaine in color and taste. The bogus cocaine, according to this plan, would cause violent reactions in the cocaine users (if they survived) and thereby turn them against the cocaine dealers. After due consideration, however, the plan for the government to distribute methedrene surreptitiously in key cities in the United States was rejected, and eventually all the plans, analyses, and reports of ONNI dealing with cocaine were shredded and destroyed on White House orders.

The waiting game continued.