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The relationship between intellect and power is an inherently neurotic one, and seldom has this neurosis been more successfully exploited than during the Cold War, when the CIA enlisted left-leaning intellectuals in the fight against the Soviet threat. As difficult as it may be to imagine, the organization believed, in the words of Arthur Schlesinger Jr., "that democratic socialism was the most effective bulwark against totalitarianism." And who better to fight the communists than those who had been betrayed by that "god that failed"?

The Cultural Cold War: The CIA and the World of Arts and Letter By Frances Stonor Saunders The New Press, 528 pages Nonfiction

With access to power, these intellectuals developed an intoxicating sense of relevance. Suddenly ideas were no longer simply ideas: They were a stockpile of powerful cultural weapons with which to wage the life-or-death battle for men's minds. "It's worth considering what these people had in common. They were all Christians, in a non-sectarian, T.S. Eliot kind of way," Frances Stonor Saunders quotes novelist Richard Elman in her fascinating new history, "The Cultural Cold War." "They believed in a higher authority, a higher truth which sanctioned their anti-Communist, anti-atheist crusade."

It is Saunders' perhaps unwitting achievement to have portrayed the CIA in a better light than that of most of the intellectual elite the agency funded -- who were, in one way or another, compromised by covert government money. While news that the CIA waged a cultural war in Europe by infiltrating the leading magazines, foundations and organizations of the postwar era has lost its shock value since first revealed by the Nation and Ramparts in the mid-'60s, the story of the intellectuals who were on the CIA payroll has remained largely untold. And a tawdry tale it is, chock-full of hubris, back-stabbing and ineffectual bumbling. Were it made into a movie, "The Cultural Cold War" would more closely resemble the dark antics of "Dr. Strangelove" (with a few David Lodge characters thrown in) than the moral seriousness of "The Spy Who Came in From the Cold."

So who exactly knew about the CIA's role and when did they know it? While this question might seem a trivial one to be resolving in the year 2000, it lies at the heart of Saunders' book. As with the Alger Hiss case or the assassination of President Kennedy, what you thought about the part that CIA funding played said a lot about what kind of person you were. An unwitting dupe? A knowledgeable cynic? A true-believing CIA intellectual? Some combination of the three?

The most startling aspect of "The Cultural Cold War" is the comprehensive list Saunders has compiled of those who took CIA funds: Isaiah Berlin, Sidney Hook, Lionel and Diana Trilling, Robert Lowell, Daniel Bell, Mary McCarthy, Mark Rothko, Bertrand Russell, Arthur Schlesinger, Edward Shils. At times it seems as if few critics, composers or artists of any talent resisted. With the CIA's operations in Iran (1953), Guatemala (1954), Cuba (1961) and Vietnam, the question of how much one knew became as much a moral as an epistemological one.

Saunders' story begins in the winter of 1947, when the short-lived U.S.-Soviet alliance degenerated into a wary standoff. The warm and cuddly image of "Uncle Joe" Stalin that the West's wartime propaganda machine encouraged turned out to be masking a reality that was anything but. With the Nazis defeated, Stalin began a campaign to win over Eastern Europe's labor unions, youth groups, cultural institutions and publishers. Although dwarfed by the United States' economic and military might, the Soviet Union did much in the early years of the Cold War to establish its central paradigm as a cultural one. "America," Saunders writes, "despite a massive marshaling of the arts in the New Deal period, was a virgin in the practice of international Kulturkampf."

Under the auspices of the Truman Doctrine and the Marshall Plan, the CIA waged a campaign to establish the Pax Americana. The Office of Policy Coordination, a CIA division, immediately launched what amounted to a covert psychological program to "nudge the intelligentsia of western Europe away from its lingering fascination with Marxism and Communism towards a view more accommodating of 'the American way.'" The essential strategy was conceived by diplomat George Kennan: "They have fought us with unreality, with irrationalism. Can we combat this unreality successfully with rationalism, with true, with honest, well-meant economic assistance?" he asked. Of course not. "A central feature of this program," writes Saunders, "was to advance the claim that it did not exist." And so the CIA launched a top-secret European campaign designed to showcase the principles of freedom and democracy.

To press its cause, the CIA founded the Congress for Cultural Freedom, an institution that brings to mind Dwight Macdonald's description of the Ford Foundation: "a large body of money completely surrounded by people who want some." A sprawling organization with dozens of offices in 35 countries, it funded 20 magazines and sponsored hundreds of conferences, art exhibits and performances across the globe. The congress was the brainchild of Michael Josselson, "the Diaghilev of America's counter-Soviet cultural propaganda campaign," who had been a buyer at Saks before joining the CIA. The congress was the CIA's de facto Ministry of Culture, funding the magazines, exhibitions and concerts at a furious pace. The Crusade for Freedom, the Truth Campaign, the Militant Liberty Campaign -- many of the congress' programs sounded positively Orwellian, a synthesis of the saccharine and the sinister, with a dash of noir thrown in for good measure.

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