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CURRENT AND PROJECTED NATIONAL SECURITY

THREATS TO THE UNITED STATES

HEARING

BEFORE THE

SELECT COMMITTEE ON INTELLIGENCE

UNITED STATES SENATE

ONE HUNDRED NINTH CONGRESS

SECOND SESSION

FEBRUARY 2, 2006

Printed for the use of the Select Committee on Intelligence

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/senate

(II)

SELECT COMMITTEE ON INTELLIGENCE

[Established by S. Res. 400, 94th Cong., 2d Sess.]

PAT ROBERTS, Kansas, Chairman

JOHN D. ROCKEFELLER IV, West Virginia, Vice Chairman

ORRIN G. HATCH, Utah

MIKE DeWINE, Ohio

CHRISTOPHER S. BOND, Missouri

TRENT LOTT, Mississippi

OLYMPIA J. SNOWE, Maine

CHUCK HAGEL, Nebraska

SAXBY CHAMBLISS, Georgia

CARL LEVIN, Michigan

DIANNE FEINSTEIN, California

RON WYDEN, Oregon

EVAN BAYH, Indiana

BARBARA A. MIKULSKI, Maryland

RUSSELL D. FEINGOLD, Wisconsin

BILL FRIST, Tennessee, Ex Officio

HARRY REID, Nevada, Ex Officio

JOHN W. WARNER, Virginia, Ex Officio

BILL DUHNKE, Staff Director and Chief Counsel

ANDREW W. JOHNSON, Minority Staff Director

KATHLEEN P. MCGHEE, Chief Clerk

(III)

CONTENTS

Page

FEBRUARY 2, 2006

OPENING STATEMENTS

Roberts, Hon. Pat, Chairman, a U.S. Senator from the State of Kansas .... 1

Rockefeller, Hon. John D. IV, Vice Chairman, a U.S. from the State

of West Virginia ............................................................................................ 5

WITNESSES

Negroponte, Hon. John D., Director of National Intelligence .............................. 9

Prepared statement .......................................................................................... 26

(1)

HEARING ON CURRENT AND PROJECTED

NATIONAL SECURITY THREATS TO THE

UNITED STATES

THURSDAY, FEBRUARY 2, 2006

U.S. SENATE,

SELECT COMMITTEE ON INTELLIGENCE,

Washington, DC.

The Committee met, pursuant to notice, at 10:10 a.m., in room

SH–216, Hart Senate Office Building, the Honorable Pat Roberts

(Chairman of the Committee) presiding.

Present: Senators Roberts, Hatch, DeWine, Bond, Lott, Snowe,

Hagel, Chambliss, Warner, Rockefeller, Levin, Feinstein, Wyden,

Bayh, Mikulski, and Feingold.

OPENING STATEMENT OF HON. PAT ROBERTS, CHAIRMAN,

A U.S. SENATOR FROM KANSAS

Chairman ROBERTS. The Committee will come to order. The first

order of business is to welcome Senator Feingold as a new Member

of the Committee. Senator Feingold is a very conscientious Member, very hard-working Member, and we’re very pleased to have

him. And I would yield to him at this time, if he would like to

make a very short statement.

Senator FEINGOLD. Thank you, Mr. Chairman. I’ll just say what

an honor it is to be on this Committee at any time, but particularly

in this time in our history with the challenges that we face. And

I thank you and everybody for their courtesies in getting me used

to the practices of the Committee.

Thank you, Mr. Chairman.

Chairman ROBERTS. I thank the Senator.

Today the Senate Select Committee on Intelligence meets in open

session to conduct its annual worldwide threat hearing. The Committee always begins the legislative year with an open hearing—

it’s a tradition—so that the public will have the benefit of knowing

the intelligence community’s best assessments of the current and

projected national security threats to the United States.

Our witness is Mr. John Negroponte, the director of national intelligence. Mr. Director, thank you for taking your valuable time to

come here today. It’s a pleasure to have you here.

To assist in fielding the Committee’s questions, the director is

joined at the witness table by: General Michael Hayden, the Principal Deputy Director of National Intelligence; Mr. Robert Mueller,

the Director of the Federal Bureau of Investigation; Mr. Porter

Goss, the Director of the Central Intelligence Agency; and LieutenVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 C:\DOCS\31316.TXT DianeA PsN: DianeA
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ant General Michael Maples, the Director of the Defense Intelligence Agency; Mr. Charles Allen—no stranger to the Committee—

the Chief Intelligence Officer for the Department of Homeland Security; and Ms. Carol Rodley, the Acting Assistant Secretary of

State for Intelligence and Research.

And on behalf of the Committee, we thank all of you for being

here today. Thank you for your perseverance and thank you for the

job that you’re doing.

Mr. Director, this is your first appearance at the Committee’s

worldwide threat hearing as the head of the U.S. intelligence community. I look forward, as do the rest of the Members, to your presentation on the community’s views concerning the many threats

our Nation must confront. The threat of terrorism is my most immediate concern, as I know it is yours.

The Nation does remain at war with Islamic terrorists who, as

we all know, on September 11, 2001, murdered 3,000 innocent people here on American soil. We must never forget that fact.

Thankfully, since that day, we have not suffered another major

attack on our soil. That is due at least in some part—I think large

part—to the brave and very dedicated men and women of our intelligence community, the armed forces and our law enforcement

agencies who are executing an aggressive and forward-leaning

counterterrorism policy.

We should not, however, be lulled in to a false sense of security.

The terrorists are a patient and determined enemy. As Usama bin

Ladin’s recent audiotape demonstrates, he and his terrorist network, while damaged, are still a very real threat to America. So

when Usama bin Ladin or his No. 2, Zawahiri, or Zarqawi in Iraq,

does issue a threat, I take it seriously, as should we all.

These are terrorists who have a track record for following

through on threats no matter how long it takes. Remember, the

first attack on the World Trade Center was 1993. Eight years later

came 9/11. Had the terrorists put the bombs that were put in the

World Trade Center back in 1993 where the grid was, 6,000 people

wouldn’t have come out suffering from smoke inhalation; they

would have not actually have come out.

So, they do have patience. Our enemies are continually probing

our defenses and adjusting their tactics in an attempt to launch a

successful mass casualty attack. We continually see the evidence of

the training and the commitment and the sheer brutality of alQa’ida and other terrorist groups. Every American should understand our terrorist adversaries. They think of us—everybody in this

room, all of the people who are going to testify, all of the Committee Members—as dust. Now, think about that. In their extremist absolutism, our lives and the lives of those we hold dear have

no value.

Ladies and gentlemen, to counter this evil, we must remain vigilant and forward leaning as we prosecute this war. That means we

must not only use every lawful means at our disposal to protect the

American people from another attack, we must support the men

and women sitting before us here today as they lead their respective agencies in a conflict which is often fought in the shadows of

some of the most dangerous places on Earth.

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Along with terrorism, our Nation faces a variety of other threats.

Last year, I identified North Korea and Iran and Communist China

and proliferation as primary threats worthy of Committee attention. The threat of proliferation and the threats posed by Iran and

North Korea really go hand in hand. The intelligence community

assesses that North Korea already has nuclear weapons, and Iran,

if it continues on its current path—and we hope we could see some

action by the Security Council and others working on this, but they

will likely have the capability to produce a nuclear weapon within

the next decade. In addition, there are indications that both Iran

and North Korea are continuing work on numerous weapon programs, including long—range ballistic missiles and advanced conventional weapon systems.

On our side of the world, Latin America continues to present a

number of challenges, including a trend toward socialist anti-American governments, including, most notably, Venezuela.

I’m going to deviate from my remarks, and I apologize to my

membership, but there are 360 million people in 31 nations that

comprise the Southern Command, and I must say it is not neglect,

but maybe benign neglect and in terms of the fact that we’re

stretched so thin. Other than energy, other than immigration,

other than trade, other than drugs, that part of the world really

has no affect on the United States, and so consequently, I think we

must refocus, at least to some degree, on the threats that are really

threats in the Southern Command.

For our part, the Committee will continue to examine the intelligence community’s capabilities against Iran, North Korea and

other areas of interest. We try to challenge the community to think

of new ways to penetrate those hard collection targets, and they try

as well.

I do not believe the intelligence community is where it needs to

be. I think most of the people at the table will agree with that, but

we have made impressive strides in the past few years. The threat

from communist China is also one which we must closely monitor.

China has not so quietly emerged as a regional power both militarily and also economically. China’s not the next big thing. They

are the big thing.

While the United States, in general, enjoys good relations with

China—and we must do that; we must endeavor to do that—we

and our regional allies are given pause by China’s often-aggressive

statements in regards to Taiwan, its very dramatic investment in

offensive military capabilities in a blue-water Navy and its questionable counterproliferation record. Additionally, China maintains

a determined espionage effort within the United States, which is

aimed at stealing our most sensitive weapons’ secrets. Harsh

words, I intend them to be.

China’s increasing influence in our global affairs is undeniable.

It is my hope that Beijing will use this increasing influence to actually promote stability, curb the nuclear ambitions of North Korea

and provide greater support to counterproliferation and

counterterrorism initiatives.

Now, Mr. Director, I look forward to hearing from you about

these and the many other threats which face us across the globe.

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I also look forward to the input of the Intelligence Agency directors

during the question and answer period.

Once again, it is important to remember that the Nation is at

war. It is a war which requires aggressive intelligence collection

and close combat with the enemy. The success of the latter often

depends entirely on the success of the former.

Our witnesses today and the men and women whom they lead

are on the front lines of that war. Unlike us, they are doing the

fighting and the dying, and they do so to keep us and our families

safe.

Although we will never be able to repay them the debt we owe,

it seems to me that we must provide them with every possible advantage, which includes not only adequate resources, but also the

capabilities and the authorities that they require.

It is also our responsibility to conduct oversight, and the Committee meets that responsibility in a number of different ways. We

receive briefings, we conduct hearings at a rate far exceeding any

other previous Congress. As a Member of this Committee, we will

tell you we are very demanding of their time. We read and review

intelligence reporting and analysis. We interview intelligence officials. We travel around the world. We meet with people on the

front lines in what is truly a global conflict. We also, when the

Committee so decides, conduct investigations and inquiries into

specific matters.

For example, we are presently engaged in the final stages—let

me repeat, the final stages—of our examination of issues that are

related to prewar intelligence on Iraq. And I hope we have that

concluded at the earliest possible date. My hope is to complete that

effort as soon as practical.

There has also been a great deal of discussion in regard to the

issue of terrorist surveillance. Senator Rockefeller and I have been

intimately involved with this issue since we assumed our respective

positions. We have been conducting oversight over this critical capability for almost 3 years now. Nonetheless, the minority Members and some in the majority of this Committee have requested an

opportunity to meet and discuss whether the Vice Chairman and

my efforts on their behalf have been sufficient. I have scheduled

such a business meeting for February 16. I have assured the Vice

Chairman twice that the Committee will have an opportunity to express its will on this matter, and we will.

Yesterday, Members had the opportunity to meet with various officials of the Justice Department to discuss the legal issues associated with terrorist surveillance. I’ve also scheduled a hearing for

February 9—I want all Members to note that—when we will meet

in executive session to hear from Attorney General Gonzales and

also General Hayden. I hope my actions and my words are sufficient to assuage any lingering concerns about what we may or may

not be doing.

If any Member wishes to discuss further the Committee activities, I’m happy to make arrangements to do so at an appropriate

time. For now, the Committee turns its attention to our annual

worldwide threat hearing. Our witnesses are some of the Nation’s

premiere experts on national security matters. During this open

hearing, I am hopeful that Members will take the opportunity to

5

engage this uniquely qualified panel in a manner which will educate the American people to the maximum extent possible on the

global threats faced by our Nation.

I ask that Members do reserve questions for the closed session

that will require a discussion of classified or sensitive material.

Before I turn to our Director, I recognize the distinguished Vice

Chairman for any remarks that he may wish to make.

OPENING STATEMENT OF HON. JOHN D. ROCKELLER IV,

VICE CHAIRMAN, A U.S. SENATOR FROM WEST VIRGINIA

Vice Chairman ROCKEFELLER. Thank you, Mr. Chairman.

Welcome, Director Negroponte. This is not just your first visit at

a world threat meeting, but it’s your first visit with the Committee,

and we’re happy to see you here, and everybody else.

Americans are presented with sobering information about the

threats facing our country on a daily basis. They are continually reminded that the passage of time since the attacks of 9/11 has done

little to lower the security threat both here and abroad. In the immediate aftermath of 9/11, America moved swiftly and decisively

against al-Qa’ida in Afghanistan and the surrounding region.

However, at the same time, we were destroying the terrorist safe

haven in Afghanistan. Our military invasion of Iraq, in turn, created a dangerous terrorist environment that did not exist prior to

the war—a place where Islam’s jihadists can train on the front line

and carry out attacks against American and allied troops.

Our military action in Afghanistan forced bin Ladin and the alQa’ida leadership to run and hide. We isolated them and disrupted

their terrorist networks and plots. By invading Iraq, however, we

gave them not only a target-rich terrorist environment, but an effective propaganda tool for fostering anti-American, anti-Western

sentiment throughout the Muslim world. As a result, we are now

faced with the disturbing trend of autonomous terrorist organizations and groups with little or no operational or organizational link

to al-Qa’ida carrying out murderous attacks against civilians in

Spain, Britain, Southeast Asia and elsewhere.

I’m afraid that the gains in Afghanistan have been offset by the

unintended consequences of our actions in Iraq. We now face a

more decentralized, but equally lethal terrorist threat which cannot

be decapitated by the capture of a single individual or any specific

target. This metastasized threat presents a number of operational

and political challenges to our counterterrorist program, and I’d

like to take a moment just to speak about one of them.

The 2004 intelligence reform bill creating the Director of National Intelligence position requires the Director to be responsible

for providing national intelligence to the Congress. That’s the law.

The law requires that the intelligence provided by the Director

should be timely, should be objective and independent of political

consideration.

Now, many of us on this Committee fought hard for the inclusion

of that phrase ‘‘independent of political consideration,’’ to have that

in the law, because we were troubled by what we had found in the

Committee’s investigation into the handling of intelligence on Iraq

prior to the war. Of specific concern to me was the disturbing pattern by the Administration of selectively releasing or declassifying

6

intelligence that supported the case to go to war, while dismissing

or downplaying or simply not acknowledging intelligence that undercut claims that Iraq had an active nuclear weapons program,

that Iraq was assisting al-Qa’ida with chemical and biological

weapons, or, as the Vice President continued publicly assert, that

Iraq had a role in the 9/11 attacks against America.

To be blunt, Director Negroponte, I have these same concerns

today.

I am deeply troubled by what I see as the Administration’s continued effort to selectively release intelligence information that

supports its policy or political agenda while withholding equally

pertinent information that does not do that. The question I am

wrestling with is whether the very independence of the U.S. Intelligence Community has been co-opted, to be quite honest about it,

by the strong, controlling hand of the White House.

Now, let me be specific. The recent revelation that the National

Security Agency, at the direction of the President, has been intercepting phone calls and e-mails within the United States without

a warrant and in contravention of the Foreign Intelligence Surveillance Act for the past 4 years has led Members of this Committee

to ask some difficult but, frankly, necessary questions about the

program.

As you know, this Committee, as the body that oversees and annually authorizes our nation’s intelligence programs, is entrusted

with the most sensitive secrets. There are statutory requirements

placed on you and the heads of the intelligence agencies to keep

our Committee Members fully informed on these matters and activities, including efforts taken to counter the terrorist threat facing our nation.

And yet the White House has laid down the edict to you and your

principal deputy, Director Negroponte and former NSA Director

General Hayden, that no one on this Committee other than the

Chairman and myself can be briefed on the NSA domestic spying

program. The reasons, we are told, is that the 13 other Members

of this Committee cannot be trusted to know the details of the program.

This rationale for withholding information from Congress is flatout unacceptable and nothing more than political smoke, in this

Senator’s view. As you, sir, and General Hayden know well, every

Member of this Committee is given access to operational details

about each and every signals intelligence collection program carried

out by the NSA against targets overseas. We’re all getting it. Much

of the staff gets it. We are briefed in closed session about ultra-sensitive NSA programs that produce unique and invaluable intelligence and, if divulged, literally could get people killed. The NSA

briefs the Committee on these programs not just because the law

requires them to do so, but because we, as the authorizers of the

intelligence budget, need to understand the value and risk of what

we do to keep America safe.

How can this Committee reconcile this ongoing intimate understanding and evaluation of the NSA’s overseas activities with the

wall that the White House has constructed around the NSA’s

warrantless collection of phone calls and e-mails inside of the

United States? What is unique about this one particular program

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among all the other sensitive NSA programs that justifies keeping

Congress in the dark?

It certainly is not that the program is cloaked in heavy secrecy.

On the contrary, it’s become one of the more public programs. Since

the existence of this program was leaked to the press in a most unfortunate fashion in mid-December, the President has not only confirmed the existence of the program, but has spoken at length

about it, repeatedly, characterizing not only the target of the intelligence collection, but the method employed to collect that information.

In recent weeks, every senior Administration official, from the

Vice President to the White House press secretary, has voluntarily

approached the cameras and microphones to talk about this NSA

domestic surveillance program. I assume that they were not only

authorized to discuss the details of this classified program, but

were in fact directed to do so.

Last week, the White House carried out a 4-day press strategy

to saturate the media with speeches and events designed to sway

public opinions, in my judgment, in support of the spying program.

The second act of this 4-day White House push was a speech

given by General Hayden before the National Press Club on January 23rd, so that he could, in his own words, ‘‘Tell the American

people what NSA has done and why, and perhaps more importantly, what it has not been doing.’’

The General’s unusual appearance before the press corps and

other related public statements give the disturbing impression to

some that the intelligence community has become a public relations

arm of the White House in recent weeks on this matter.

Even more troubling are the actions of the intelligence community to sidestep our Committee—this is something about which we

feel very strongly on—with the matter of the NSA program. To paraphrase General Hayden’s statement before the National Press

Club, why he has not been before our Committee to tell all Members what NSA has been doing and why, I just can’t justify, balance, or even understand this rationale.

The NSA’s domestic surveillance program is the most openly discussed program in the agency’s history. Administration officials

have publicly described in unprecedented fashion and detail the

scope of the program, who is targeted by the program, what type

of communications are intercepted, and how the information collected has allegedly been used to foil plots.

Director Negroponte, consider this fact. The only NSA program

the White House has authorized senior intelligence officials to discuss publicly is the only NSA program all Members of the congressional Intelligence Committees are prohibited from knowing about.

I hope you are struck by this paradox and troubled by its implication. You in the intelligence community serve the President, to

be sure, but Congress, according to the law, is an important customer of the intelligence community as well. The expectation is

that you and all officials of the intelligence community are to carry

out your duties in a manner that is independent of political influences from either end of Pennsylvania Avenue. The selective declassification of intelligence reform, which has undeniably occurred

in recent weeks in support of the Administration’s defense of the

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NSA programs, hark in fact to the troubling runup to the war in

Iraq.

A decision has been made by the White House to overly restrict

congressional access to key information about the NSA program,

while at the same time it opens the floodgates of this public relations campaign to the American people in support of the program.

I have heard that hundreds, if not thousands, of people at NSA,

the White House, the Department of Justice and the CIA have a

working knowledge of the NSA domestic surveillance program. And

yet the White House position is that if sharing the details about

the program is carried out with 40 Members of the Senate and the

House Intelligence Committees, that that’s an unacceptable risk.

I’m sorry, I can’t buy into that.

So, Mr. Director, you don’t need to answer now, but do you believe that this is so? Do you, General Hayden? A White House P.R.

campaign is not a substitute for the legal requirement—legal requirement—to keep the Members of our Committee fully informed

of intelligence activities.

Director Negroponte, during the question and answer period of

this hearing, I want to pursue this matter further with you. I will

ask for the record who specifically has prohibited you, General

Hayden, and the NSA Director, General Keith Alexander, from appearing before our Committee in closed session and providing testimony on the factual aspects of the NSA domestic surveillance program, and whether you agree with the basis for withholding this

information from Congress. I also want to find out which person or

office describes what aspects of the NSA domestic surveillance that

can be declassified and released to the public.

In closing, it may be that some Members of Congress, of this

Committee would indeed support the program if they were apprised of its scope and its operational successes. Others might oppose it. Either way, Committee Members cannot be put in the untenable position of passing judgment on a program that they are

prevented from understanding. As both a customer of intelligence

and the body that annually authorizes the important programs carried out by you gentlemen and ladies, we have a solemn responsibility to make sure that the activities that we fund are not only

justified but lawful.

As of today, we cannot make such a determination about the

NSA domestic surveillance program authorized by the President.

So, in conclusion, Director Negroponte, we will be addressing the

threats facing America in your testimony—you will be doing that.

What is being done to combat these threats is a concern shared by

all of us. I hope you appreciate why it is important for Members

of this Committee to fully understand the efforts being brought to

bear to combat the terrorist threat to our Nation, including, but not

limited to, action taken within our borders.

Thank you, Mr. Chairman.

Chairman ROBERTS. Mr. Director, I am now going to turn to you.

But let me say that, as I said in my opening statement, the Committee will have ample opportunity to discuss this issue in full at

two business meetings and obviously will conclude with the wishes

of the Committee.

9

And let me say also that my primary concern in this regard, this

particular issue, is not losing this capability and going blind and

not being able to continue to prevent attacks on the United States

and guarantee the safety of the American people.

Mr. Director.

STATEMENT OF HON. JOHN D. NEGROPONTE, DIRECTOR OF

NATIONAL INTELLIGENCE, ACCOMPANIED BY GENERAL

MICHAEL V. HAYDEN, PRINCIPAL DEPUTY DIRECTOR OF

NATIONAL INTELLIGENCE; HON. ROBERT S. MUELLER, III,

DIRECTOR, FEDERAL BUREAU OF INVESTIGATION; HON.

PORTER GOSS, DIRECTOR, CENTRAL INTELLIGENCE AGENCY; LIEUTENANT GENERAL MICHAEL D. MAPLES (USA),

DIRECTOR, DEFENSE INTELLIGENCE AGENCY; DR. CHARLES

ALLEN, CHIEF INTELLIGENCE OFFICER, DEPARTMENT OF

HOMELAND SECURITY; AND HON. CAROL RODLEY, PRINCIPAL DEPUTY ASSISTANT SECRETARY OF STATE FOR

INTELLIGENCE AND RESEARCH

Director NEGROPONTE. Thank you, Mr. Chairman, Vice Chairman Rockefeller, members of the Committee. Thank you for the invitation to offer my assessment of the threats, challenges and opportunities for the United States in today’s world. I am honored to

be the first Director of National Intelligence to offer you such an

assessment. And I am pleased to note that following my oral testimony, I will answer your questions with the assistance of those

who accompany me here at the witness table.

Let me begin with a straightforward statement of preoccupation

shared by all of us sitting here before you. Terrorism is the preeminent threat to our citizens, to our homeland and to our interests abroad. The war on terror is our first priority and driving concern as we press ahead with a major transformation of the intelligence community that we represent.

We live in a world that is full of conflict, contradictions and accelerating change. Viewed from the perspective of the Director of

National Intelligence, the most dramatic change of all is the exponential increase in the number of targets we must identify, track

and analyze. Today, in addition to hostile nation-states, we are focusing on terrorist groups, proliferation networks, alienated communities, charismatic individuals, narcotraffickers and microscopic

influenza.

The 21st century is less dangerous than the 20th century in certain respects, but more dangerous in others. Globalization, particularly of technologies that can be used to produce weapons of mass

destruction, political instability around the world, the rise of

emerging powers like China, the spread of the jihadist movement,

and, of course, the horrific events of September 11, 2001, demand

heightened vigilance from our intelligence community.

This morning, I will discuss, first, global jihadists, their fanatical

ideology, and the civilized world’s efforts to disrupt, dismantle and

destroy their networks; next, the struggle of the Iraqi and Afghan

people to assert their sovereignty over insurgency, terror, and extremism; next, WMD-related proliferation and two States of particular concern, Iran and North Korea. Then I will discuss issues

of political instability and governance in all regions of the world

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that affect our ability to protect and advance our interests; and

last, globalization, emerging powers, and such transnational challenges as the geopolitics of energy, narcotrafficking, and possible

pandemics.

In assessing these themes, we must all be mindful of the old dictum, ‘‘forewarned is forearmed.’’ Our policymakers, warfighters and

law enforcement officers need the best intelligence and analytic insight humanly and technically possible to help them peer into the

onrushing shadow of the future and make decisions that will protect American lives and interests.

This has never been more true than now, with United States and

coalition forces in Iraq and Afghanistan, the citizens and fledgling

governments they help to protect under attack. Addressing threats

to their safety and providing the critical intelligence of a myriad of

tactical and strategic issues must be—and is—a top priority for our

intelligence community.

But in discussing all the many dangers the 21st century poses,

it should be emphasized that they do not befall America alone. The

issues we consider today confront responsible leaders everywhere.

That is the true nature of the 21st century—accelerating change affecting and challenging us all.

Now I turn to the global jihadist threat. Collaboration with our

friends and allies around the world has helped us achieve some notable successes against the global jihadist threat.

In fact, most of al-Qa’ida’s setbacks last year were the results of

our allies’ efforts, either independently or with our assistance. And

since 9/11, examples of the high level of counterterrorism efforts

around the world are many. Pakistan’s commitment has enabled

some of the most important captures to date. Saudi Arabia’s resolve to counter the spread of terrorism has increased. Our relationship with Spain has strengthened since the March 2004 Madrid

train bombings. The British have long been our closest

counterterrorism partners—the seamless cooperation in the aftermath of the July attacks in London reflect that commitment—while

Australia, Canada, France and many other nations remain stout allies.

Nonetheless, much remains to be done; the battle is far from

over. Jihadists seek to overthrow regimes they regard as ‘‘apostate’’

and to eliminate United States influence in the Muslim world.

They attack Americans when they can, but most of their targets

and victims are fellow Muslims.

Nonetheless, the slow pace of economic, social, and political

change in most Muslim-majority nations continues to fuel a global

jihadist movement. The movement is diffuse and subsumes three

quite different types of groups and individuals: First and foremost,

al-Qa’ida, a battered but resourceful organization; second, other

Sunni jihadist groups, some affiliated with al-Qa’ida, some not;

third, networks and cells that are the self-generating progeny of alQa’ida.

Al-Qa’ida remains our top concern. We have eliminated much of

the leadership that presided over al-Qa’ida in 2001, and U.S.-led

counterterrorism efforts in 2005 continue to disrupt its operation,

take out its leaders and deplete its cadre.

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But the organization’s core elements still plot and make preparations for terrorist strikes against the homeland and other targets

from bases in Pakistan-Afghanistan border area. They also have

gained added reach through their merger with the Iraq-based network of Abu Musaab al-Zarqawi, which has broadened al-Qa’ida’s

appeal within the jihadist community and potentially put new resources at its disposal.

Thanks to effective intelligence operations, we know a great deal

about al-Qa’ida’s vision. Zawahiri, al-Qa’ida’s No. 2, is candid in his

July 2005 letter to Zarqawi. He portrays the jihad in Iraq as a

stepping-stone in the march toward a global caliphate, with the

focus on Egypt, Syria, Jordan, Lebanon, Saudi Arabia, the Gulf

States and Israel. Zawahiri stresses the importance of having a secure base in Iraq from which to launch attacks elsewhere, including the United States homeland.

In bin Ladin’s recent audiotape, al-Qa’ida’s top leader reaffirms

the group’s commitment to attack our homeland and attempts to

reassure supporters by claiming that the reason there has been no

attack on the United States since 2001 is that he chose not to do

so.

This week’s statement by Zawahiri is another indication that the

group’s leadership is not completely cutoff and can continue to get

its message out to followers. The quick turnaround time and the

frequency of Zawahiri statements in the past year underscore the

high priority al-Qa’ida places on propaganda from its most senior

leaders.

Attacking the U.S. homeland, U.S. interests overseas, and U.S.

allies—in that order—are al-Qa’ida’s top operational priorities. The

group will attempt high-impact attacks for as long as its central

command structure is functioning and affiliated groups are capable

of furthering its interests, because even modest operational capabilities can yield a deadly and damaging attack. Although an attack using conventional explosives continues to be the most probable scenario, al-Qa’ida remains interested in acquiring chemical,

biological, radiological, and nuclear materials or weapons to attack

the United States, U.S. troops and U.S. interests worldwide.

Indeed, today we are more likely to see an attack from terrorists

using weapons or agents of mass destruction than States, although

terrorists’ capabilities would be much more limited. In fact, intelligence reporting indicates that nearly 40 terrorist organizations,

insurgencies or cults have used, possessed, or expressed an interest

in chemical, biological, radiological, or nuclear agents or weapons.

Many are capable of conducting simple, small-scale attacks, such as

poisonings or using improvised chemical devices.

Al-Qa’ida inspires other Sunni jihadists. The global jihadist

movement also subsumes other Sunni extremist organizations allied with or inspired by al-Qa’ida’s global anti-Western agenda.

These groups pose less danger to the U.S. homeland than does alQa’ida, but they increasingly threaten our allies and interests

abroad and are working to expand their reach and capabilities to

conduct multiple and/or mass- casualty attacks outside their traditional areas of operation.

Jemaah Islamiyah is a well-organized group responsible for dozens of attacks killing hundreds of people in Southeast Asia. The

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threat of a JI attack against U.S. interests is greatest in Southeast

Asia, but we assess that the group is committed to helping alQa’ida with attacks outside the region.

The Islamic Jihad Union, the IJU, which has allied itself with alQa’ida, operates in Central Asia and was responsible for the July

2004 attacks against the United States and Israeli embassies in

Uzbekistan.

The Libyan Islamic Fighting Group, LIFG, was formed to establish an Islamic State in Libya, but since the late 1990s it has expanded its goal to include anti-Western jihad alongside al-Qa’ida.

LIFG has called on Muslims everywhere to fight the United States

in Iraq.

Pakistani militant groups, primarily focused on the Kashmir conflict, represent a persistent threat to regional stability and U.S. interests in South Asia and the Near East. They also pose a potential

threat to our interests worldwide. Extremists convicted in Virginia

in 2003 of providing material support to terrorism trained with a

Pakistani group, Lashkar-i-Tayyiba, before 9/11.

New jihadist networks and cells. An important part of alQa’ida’s strategy is to encourage a grassroots uprising of Muslims

against the West. Emerging new networks and cells, the third element of the global jihadist threat, reflect aggressive jihadist efforts

to exploit feelings of frustration and powerlessness in some Muslim

communities and to fuel the perception that the United States is

anti-Islamic. Their rationale for using terrorism against the United

States and establishing strict Islamic practices resonates with a

small subset of Muslims.

This has led to the emergence of a decentralized and diffused

movement with minimal centralized guidance or control and numerous individuals and small cells—like those who conducted the

May 2003 bombing in Morocco, the March 2004 bombings in Spain,

and the July 2005 bombings in the United Kingdom. Members of

these groups have drawn inspiration from al-Qa’ida, but appear to

operate on their own.

Such unaffiliated individuals, groups and cells represent a different threat than that of a defined organization. They are harder

to spot, and represent a serious intelligence challenge. Regrettably,

we are not immune from the threat of such homegrown jihadist

cells. A network of Islamic extremists in Lodi, California, for example, maintained connections with Pakistani militant groups, recruited U.S. citizens for training at radical Karachi madrassas,

sponsored Pakistani citizens for travel to the United States to work

at mosques and madrassas, and, according to FBI information, allegedly raised funds for international jihadist groups.

In addition, prisons continue to be fertile recruitment ground for

extremists who try to exploit converts to Islam.

Now, I wish to turn to the impact of Iraq on the global jihad.

Should the Iraqi people prevail in establishing a stable political

and security environment, the jihadists will be perceived to have

failed and fewer jihadists will leave Iraq determined to carry on

the fight elsewhere. But we assess that should the jihadists thwart

the Iraqi efforts to establish a stable political and security environment, they could secure an operational base in Iraq and inspire

sympathizers elsewhere to move beyond rhetoric to attempt attacks

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against neighboring Middle Eastern nations, against Europe, and

even the United States.

The same dynamic pertains to al-Zarqawi. His capture would deprive the movement of a notorious leader, whereas his continued

acts of terror could enable him to expand his following beyond his

organization in Iraq much as bin Ladin expanded al-Qa’ida in the

1990s.

The debate between Muslim extremists and moderates also will

influence the future terrorist environment, the domestic stability of

key U.S. partners, and the foreign policies of governments throughout the Muslim world. The violent actions of global jihadists are

adding urgency to the debate within Islam over how religion should

shape government. Growing internal demands for reform in many

Muslim countries further stimulate this debate.

In general, Muslims are becoming more aware of their Islamic

identity, leading to growing political activism; but this does not

necessarily signal a trend toward radicalization. Most Muslims reject the extremist message and violent agendas of the global

jihadists. Indeed, as Muslims endorse democratic principles of freedom, equality, and the rule of law and a role for their religious beliefs in building better futures for their communities, there will be

growing opportunities for countering a jihadist movement that

authoritarianism, isolation and economic stagnation.

Let me turn to the issue of extremism and challenges to effective

governance and legitimacy in Iraq and Afghanistan. The threat

from extremism and anti-Western militancy is especially acute in

Iraq and Afghanistan. In discussing Iraq, I’d like to offer, if you

will, a balance sheet to give a sense of where I see things today

and what I see as the trends in 2006.

Bold, inclusive leadership will be the critical factor in establishing an Iraqi constitutional democracy that is both viable as a

nation-state and responsive to the diversity of Iraq’s regions and

people.

Let me begin with some of these encouraging developments before turning to the challenges.

The insurgents have not been able to establish any lasting territorial control. They were unable to disrupt either of the two national elections held this year or the constitutional referendum.

They have not developed a political strategy to attract popular support beyond their Sunni Arab base. And they have not shown the

ability to coordinate nationwide operations.

Iraqi security forces are taking on more demanding missions,

making incremental progress toward operational independence,

and becoming more capable of providing the kind of stability Iraqis

deserve and the economy needs in order to grow.

Signs of open conflict between extreme Sunni jihadists and Sunni

nationalist elements of the insurgency, while thus far still localized, are encouraging and exploitable. The jihadists’ heavy-handed

activities in Sunni areas in western Iraq have caused tribal and

nationalist elements in the insurgency to reach out to the Baghdad

government for support.

Large-scale Sunni participation in the last elections has provided

a first step toward diminishing Sunni support for the insurgency.

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There appears to be a strong desire among Sunnis to explore the

potential benefits of political participation.

But numerous challenges remain. Iraqi Sunni Arab disaffection

is the primary enabler of the insurgency and is likely to remain

high in 2006. Even if a broad, inclusive national government

emerges, there almost certainly will be a lag time before we see a

dampening effect on the insurgency. Insurgents continue to demonstrate the ability to recruit, supply, and attack coalition and security forces, and their leaders continue to exploit Islamic themes,

nationalism, and personal grievances to fuel opposition to the government and to recruit more fighters.

The most extreme Sunni jihadists, such as those fighting with

Zarqawi, will remain unreconciled and continue to attack Iraqis

and coalition forces. These extreme Sunni jihadist elements, a subset of which are foreign fighters, constitute a small minority of the

overall insurgency, but their use of high-profile suicide attacks

gives them a disproportionate impact. The insurgents’ use of increasingly lethal improvised explosive devices, and the IED-makers’ adaptiveness to coalition countermeasures, remain the most

significant day-to-day threat to coalition forces and a complex challenge for the intelligence community.

Iraqi security forces require better command and control mechanisms to improve their effectiveness, and are experiencing difficulty

in managing ethnic and sectarian divides among their units and

personnel.

A key to establishing effective governance and security over the

next 3 to 5 years is enhanced Sunni Arab political participation

and a growing perception among Sunnis that the political process

is addressing their interests.

Sunnis will be focused on obtaining what they consider their demographically appropriate share of leadership positions in the new

government, especially on the Constitutional Review Commission.

Debates over federalism, central versus local control, and division

of resources are likely to be complex. Success in satisfactorily resolving them will be key to advancing stability and prospects for

a unified country.

Although the Kurds and Shi’a have been accommodating to the

under-represented Sunnis in 2005, their desire to protect core interests, such as regional autonomy and de-Ba’athification, could

make further compromise more difficult.

In the aftermath of the December elections, virtually all of the

Iraq parties are seeking to create a broad-based government, but

all want it to be formed on their terms. The Shi’a and the Kurds

will be the foundation of any governing coalition, but it is not yet

clear to us whether they will include the main Sunni factions, particularly the Iraqi Consensus Front, or other smaller and politically

weaker secular groups, such as former Prime Minister Allawi’s

Iraqi National List.

The Sunni parties have significant expectations for concessions

from the Shi’a and Kurds in order to justify their participation and

avoid provoking more insurgent violence directed against Sunni political leaders.

During the coming year, Iraq’s newly elected leadership will face

a daunting set of governance tasks. The creation of a new, permaVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 C:\DOCS\31316.TXT DianeA PsN: DianeA
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nent government and the review of the constitution by early summer will offer opportunities to find common ground and improve

the effectiveness and legitimacy of the central government. There

is a danger, however, that political negotiations and deal-making

will prove divisive. This could obstruct efforts to improve government performance, extend Baghdad’s reach throughout the country

and build confidence in the democratic political process.

Let me focus on one of those tasks—the economy. Restoration of

basic services and the creation of jobs are critical to the well-being

of Iraqi citizens, the legitimacy of the new government, and, indirectly, to eroding support for the insurgency. At this point, prospects for economic development in 2006 are constrained by the unstable security situation, insufficient commitment to economic reform, and to corruption. Iraq is dependent on oil revenues to fund

the government, so insurgents continue to disrupt oil infrastructure, despite the fielding of new Iraqi forces to protect it. Insurgents also are targeting trade and transportation. Intelligence has

a key role to play in combating threats to pipelines, to electric

power grids, and personal safety.

Turning now to Afghanistan, like Iraq, Afghanistan is a fragile

new democracy struggling to overcome deep-seated social divisions,

decades of repression, and acts of terrorism directed against ordinary citizens, officials, foreign aid workers, and coalition forces.

These and other threats to the Karzai government also threaten

important American interests ranging from the defeat of terrorists

who find haven along the Afghanistan-Pakistan border to the suppression of opium production.

Afghan leaders face four critical challenges: Containing the insurgency, building central government capacity and extending its

authority, further containing warlordism, and confronting pervasive drug criminality. Intelligence is needed to assist, monitor, and

protect Afghan, coalition, and NATO efforts in all four endeavors.

The volume and geographic scope of attacks increased last year,

but the Taliban and other militants have not been able to stop the

democratic process or expand their support base beyond Pashtun

areas of the South and East. Nevertheless, the insurgent threat

will impede the expansion of Kabul’s writ, it will slow economic development, and limit progress in counternarcotics efforts.

Ultimately, defeating the insurgency will depend heavily on continued international aid; on effective coalition, NATO, and Afghan

government security operations to prevent the insurgency from

gaining a stronger foothold in some Pashtun areas; and on the success of the government’s reconciliation initiatives.

I would like now to turn to the issue of weapons of mass destruction and States of key concern, Iran and North Korea. The ongoing

development of dangerous weapons and delivery systems constitutes the second major threat to the safety of our Nation, our deployed troops, and to our allies. We are most concerned about the

threat and destabilizing effect of nuclear proliferation. We are also

concerned about the threat from biological agents or even chemical

agents, which would have psychological and possibly political effects far greater than their actual magnitude. Use by nation-states

can still be constrained by the logic of deterrence and international

control regimes, but these constraints may be of little utility in preVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 C:\DOCS\31316.TXT DianeA PsN: DianeA
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venting the use of mass effect weapons by rogue regimes or terrorist groups.

The time when a few states had monopolies over the most dangerous technologies has been over for many years. Moreover, our

adversaries have more access to acquire and more opportunities to

deliver such weapons than in the past. Technologies, often dualuse, move freely in our globalized economy, as do the scientific personnel who design them. So it is more difficult for us to track efforts to acquire those components and production technologies that

are so widely available.

The potential dangers of proliferation are so grave that we must

do everything possible to discover and disrupt attempts by those

who seek to acquire materials and weapons.

We assess that some of the countries that are still pursuing

WMD programs will continue to try to improve their capabilities

and level of self-sufficiency over the next decade. We also are focused on the potential acquisition of such nuclear, chemical and/or

biological weapons, or the production technologies and materials

necessary to produce them by states that do not now have such

programs, terrorist organizations like al-Qa’ida and by criminal organizations, either alone or through middlemen.

We are working with other elements of the U.S. Government regarding the safety and security of nuclear weapons and fissile material, pathogens, and chemical weapons in select countries.

Our concerns about Iran are shared by many nations, by the

International Atomic Energy Agency and, of course, Iran’s neighbors. Iran conducted a clandestine uranium enrichment program

for nearly two decades in violation of its IAEA safeguards agreement and, despite its claim to the contrary, we assess that Iran

seeks nuclear weapons. We judge that Tehran probably does not

yet have a nuclear weapon and probably has not yet produced or

acquired the necessary fissile material.

Nevertheless, the danger that it will acquire a nuclear weapon

and the ability to integrate it with ballistic missiles Iran already

possesses is a reason for immediate concern. Iran already has the

largest inventory of ballistic missiles in the Middle East, and

Tehran views its ballistic missiles as an integral part of its strategy

to deter—and if necessary retaliate against—forces in the region,

including U.S. forces.

As you are aware, Iran is located at the center of a vital and

volatile region. It has strained relations with its neighbors and is

hostile to the United States, to our friends, and to our values.

President Ahmadinejad has made numerous unacceptable statements since his election, hard-liners have control of all the major

branches and institutions of government, and the government has

become more effective and efficient at repressing the nascent

shoots of personal freedom that had emerged in the late 1990s and

earlier in the decade. Indeed, the regime today is more confident

and assertive than it has been since the early days of the Islamic

Republic.

Several factors work in favor of the clerical regime’s continued

hold on power. Record oil and other revenue is permitting generous

public spending, fueling strong economic growth and swelling financial reserves. At the same time, Iran is diversifying its foreign

17

trading partners. Asia’s share of Iran’s trade has jumped to nearly

match Europe’s 40 percent share. Tehran sees diversification as a

buffer against external efforts to isolate it.

Although regime-threatening instability is unlikely, ingredients

for political volatility remain, and Iran is wary of the political

progress occurring in neighboring Iraq and Afghanistan.

Ahmadinejad’s rhetorical recklessness and his inexperience on the

national and international stage also increase the risk of a misstep

that could spur popular opposition, especially if more experienced

conservatives cannot rein in his excesses. Over time,

Ahmadinejad’s populist economic policies could, if enacted, deplete

the government’s financial resources and weaken a structurally

flawed economy. For now, however, Supreme Leader Khamenei is

keeping conservative fissures in check by balancing the various factions in government.

Iranian policy toward Iraq and its activities there represent a

particular concern. Iran seeks a Shi’a-dominated and unified Iraq,

but also wants the United States to experience continued setbacks

in our efforts to promote democracy and stability. Accordingly, Iran

provides guidance and training to select Iraqi Shi’a political groups,

and weapons and training to Shi’a militant groups to enable anticoalition attacks. Tehran has been responsible for at least some of

the increasing lethality of anti-coalition attacks by providing Shi’a

militants with the capability to build improvised explosive devices

with explosively formed projectiles similar to those developed by

Iran and Lebanese Hezbollah.

Tehran’s intentions to inflict pain on the United States in Iraq

has been constrained by its caution to avoid giving Washington an

excuse to attack it, also the clerical leadership’s general satisfaction

with trends in Iraq, and Iran’s desire to avoid chaos on its border.

Iranian conventional military power constitutes the greatest potential threat to Persian Gulf States and a challenge to U.S. interests. Iran is enhancing its ability to project its military power in

order to threaten to disrupt the operations and reinforcement of

U.S. forces based in the region, potentially intimidating regional allies into withholding support for U.S. policy toward Iran and raising the costs of our regional presence for the United States—for us

and our allies.

Tehran also continues to support a number of terrorist groups,

viewing this capability as a critical regime safeguard by deterring

U.S. and Israeli attacks, by distracting and weakening Israel, and

enhancing Iran’s regional influence through intimidation. Lebanese

Hezbollah is Iran’s main terrorist ally, which, although focused on

its agenda in Lebanon and supporting anti-Israeli Palestinian terrorists, has a worldwide support network and is capable of attacks

against U.S. interests if it feels its Iranian patron is threatened.

Tehran also supports Palestinian Islamic Jihad and other groups

in the Persian Gulf, Central and South Asia, and elsewhere.

Now, turning to North Korea, North Korea claims to have nuclear weapons, a claim that we assess is probably true, and it has

threatened to proliferate these weapons abroad. Thus, like Iran,

North Korea threatens international security and is located in a

historically volatile region. Its aggressive deployment posture

18

threatens our allies in South Korea and U.S. troops on the peninsula.

Pyongyang sells conventional weapons to Africa, Asia and the

Middle East, and has sold ballistic missiles to several Middle Eastern countries, further destabilizing regions already embroiled in

conflict. And it produces and smuggles abroad counterfeit U.S. currency, as well as narcotics and other contraband.

Pyongyang sees nuclear weapons as the best way to deter superior U.S. and South Korean forces, to ensure regime security, as a

lever for economic gain and as a source of prestige. Accordingly, the

North remains a major challenge to the global nuclear nonproliferation regimes.

We do not know the conditions under which North Korea might

be willing to fully relinquish its nuclear weapons and its weapons

program. Nor do we see signs of organized opposition to the regime

among North Korea’s political or military elite.

Now let me turn to the issue of governance, political instability

and democratization. Good governance and, over the long term,

progress toward democratization are crucial factors in navigating

through the period of international turmoil and transition that

commenced with the end of the cold war and that will continue

well into the future. In the absence of effective governance and reform, political instability often compromises our security interests

while threatening new democracies and pushing flailing states into

failure.

I will now review those States of greatest concern to the United

States, framing my discussion within the context of trends and developments in their respective regions.

First the Middle East. The tensions between autocratic regimes,

extremism, and democratic forces extends well beyond our earlier

discussion about Iran, Iraq and Afghanistan to other countries in

the Middle East. Emerging political competition and the energizing

of public debate on the role of democracy and Islam in the region

could lead to the opening of political systems and development of

civic institutions, providing a possible bulwark against extremism.

But the path to change is far from assured. Forces for change are

vulnerable to fragmentation and long-standing regimes are increasingly adept at using both repression and limited reforms to moderate political pressures to assure their survival.

We continue to watch closely events in Syria, a pivotal—but generally unhelpful—player in a troubled region. Despite the Syrian

military withdrawal from Lebanon last year, Damascus still meddles in its internal affairs, seeks to undercut prospects for ArabIsraeli peace, and has failed to crackdown consistently on militant

infiltration into Iraq. By aligning itself with Iran, the Bashar alAsad regime is signaling its rejection of the Western world. Over

the coming year, the Syrian regime could face internal challenges

as various pressures—especially the fallout of the United Nation

investigation into the assassination of the former Lebanese prime

minister—raise questions about President Bashar al-Asad’s judgment and leadership capacity.

Syria’s exit from Lebanon has created political opportunities in

Beirut, but sectarian tensions—especially the sense among Shi’a

that they are underrepresented in the government—and DamasVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00022 Fmt 6633 Sfmt 6633 C:\DOCS\31316.TXT DianeA PsN: DianeA
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cus’s meddling persist. Bombings since March targeting anti-Syria

politicians and journalists have fueled sectarian animosities.

Egypt held Presidential and legislative elections for the first time

with multiple Presidential candidates in response to internal and

external pressures for democratization. The Egyptian public, however, remains discontented by economic conditions, the Arab-Israeli

problem, the U.S. presence in Iraq, and insufficient political freedoms.

Saudi Arabia’s crackdown on al-Qa’ida has prevented major terrorist attacks in the Kingdom for more than a year and degraded

the remnants of the terror network’s Saudi-based leadership, manpower, access to weapons and operational capability. These developments, the Kingdom’s smooth leadership transition, and high oil

prices have eased, but not eliminated, concerns about stability.

Hamas’ performance in last week’s election ushered in a period

of great uncertainty as President Abbas, the Israelis, and the rest

of the world determine how to deal with a majority party in the

Palestinian Legislative Council that conducts and supports terrorism and refuses to recognize or negotiate with Israel. The election, however, does not necessarily mean that the search for peace

between Israel and the Palestinians is halted irrevocably. The vote

garnered by Hamas may have been cast more against the Fatah

than for the Hamas program of rejecting Israel. In any case,

Hamas must now contend with the Palestinian public opinion that

has over the years has supported the two-state solution.

Let me turn now to South Asia.

Many of our most important interests intersect in Pakistan. The

nation is a frontline partner in the war on terror, having captured

several al-Qa’ida leaders, but also remains a major source of extremism that poses a threat to Musharraf, to the United States, and

to neighboring India and Afghanistan.

Musharraf faces few political challenges in his dual role as President and chief of the Army Staff, but has made only limited

progress moving his country toward democracy. Pakistan retains a

nuclear force outside the Treaty on the Nonproliferation of Nuclear

Weapons and not subject to full-scope IAEA safeguards, and has

been both recipient and source—via A.Q. Khan’s proliferation activities—of nuclear weapons-related technologies. Pakistan’s national elections scheduled for 2007 will be a key benchmark to determine whether the country is continuing to make progress in its

democratic transition.

Since India and Pakistan approached the brink of war in 2002,

their peace process has lessened tensions, and both appear committed to improving the bilateral relationship. A number of confidence-building measures, including new transportation links,

have helped sustain the momentum. Still, the fact that both have

nuclear weapons and missiles to deliver them entails obvious and

dangerous risks of escalation.

Turning now to Eurasia, in Russia, President Putin’s drive to

centralize power and assert control over civil society, growing state

control over strategic sectors of the economy, and the persistence

of widespread corruption raise questions about the country’s direction. Russia could become a more inward-looking and difficult

interlocutor for the United States over the next several years. High

20

profits from exports of oil and gas and perceived policy successes

at home and abroad have bolstered Moscow’s confidence.

Russia probably will work with the United States on shared interests such as counterterrorism, counternarcotics and

counterproliferation; however, growing suspicions about Western

intentions and Moscow’s desire to demonstrate its independence

and defend its own interests may make it harder to cooperate with

Russia on areas of concern to the United States.

Now, let me briefly examine the rest of post-Soviet Eurasia,

where the results in the past year have been mixed. Many of the

former Soviet republics are led by autocratic, corrupt, clan-based

regimes whose political stability is based on different levels of repression; yet, at the same time, we have seen in Georgia, in

Ukraine, and in Kyrgyzstan the emergence of grassroots forces for

change.

Central Asia remains plagued by political stagnation and repression, rampant corruption, widespread poverty and widening socioeconomic inequalities, and other problems that nurture nascent

radical sentiment and terrorism. In the worst, but not implausible

case, central authority in one or more of these States could evaporate as rival clans or regions vie for power, opening the door to an

expansion of terrorist and criminal activity on the model of failed

states like Somalia and, when it was under Taliban rule, Afghanistan.

Turning now to Latin America, a gradual consolidation and improvement of democratic institutions is the dominant trend in

much of Latin America. By the year’s end, 10 countries will have

held Presidential elections and none is more important to U.S. interests than the contest in Mexico in July. Mexico has taken advantage of the NAFTA and its economy has become increasingly integrated with the United States and Canada. Committed democrats

in countries like Brazil and Chile are promoting economic growth

and poverty alleviation. And, despite battling persistent insurgent

and paramilitary forces with considerable success, Colombia remains committed to keeping on a democratic path. Nonetheless,

radical populist figures in some countries advocate statist economic

policies and show little respect for democratic institutions.

In Venezuela, President Chavez, if he wins reelection later this

year, appears ready to use his control of the legislature and other

institutions to continue to stifle the opposition, to reduce press freedom, and entrench himself through measures that are technically

legal, but which nonetheless constrict democracy. We expect Chavez to deepen his relationship with Castro. He also is seeking closer economic, military, and diplomatic ties with Iran and North

Korea. Chavez has scaled back counternarcotics cooperation with

the United States. Increased oil revenues have allowed Chavez to

embark on an activist foreign policy in Latin America that includes

providing oil at favorable repayment rates to gain allies, using

newly created media outlets to generate support for his Bolivarian

goals, and meddling in the internal affairs of his neighbors by

backing particular candidates for elective office.

In Bolivia, South America’s poorest country with the hemisphere’s highest proportion of indigenous people, the victory of Evo

Morales reflects the public’s lack of faith in traditional political

21

parties and institutions. Since his election, he appears to have

moderated his earlier promises to nationalize the hydrocarbons industry and cease coca eradication. But his Administration continues to send mixed signals regarding its intentions.

Haiti’s interim government is the weakest in the hemisphere,

and the security climate could continue to deteriorate due to slum

gang violence. A failure to renew the United Nations mandate

would greatly increase the risk of a complete nationwide breakdown of public order, intensifying migration pressures. The perception among would-be migrants that the U.S. immigration policy is

tough is the most important factor in deterring Haitians from fleeing their country.

Turning now to Southeast Asia. Southeast Asia includes vibrant,

diverse, and emerging democracies looking to the United States as

a source of stability, wealth and leadership. But it is also home to

terrorism, separatist aspirations, crushing poverty, ethnic violence,

and religious divisions. Burma remains a dictatorship, and Cambodia is retreating from progress on democracy and human rights

that it made in the 1990s. The region is particularly at risk from

avian flu, which I will discuss at greater length in a moment. AlQa’ida-affiliated and other extremist groups are present in many

countries, although effective government policies have limited their

growth and input.

The prospects for democratic consolidation are relatively bright

in Indonesia, the country with the world’s largest Muslim population. President Yudhoyono is moving forward to crack down on

corruption, professionalize the military, bring peace to the longtroubled province of Aceh, and to implement economic reforms. On

the counterterrorism side, Indonesian authorities have detained or

killed significant elements of Jemaah Islamiyah, the al-Qa’idalinked terrorist group, but Jemaah Islamiyah remains a tough foe.

The Philippines remain committed to democracy despite political

turbulence over alleged cheating in the 2004 elections and repeated

rumors of coup plots. Meanwhile, Manila continues to struggle with

the 35-year-old Islamic and communist rebellions, and faces growing concerns over the presence of JI terrorists in the South.

Thailand is searching for a formula to contain violence instigated

by ethnic Malay Muslims separatist groups in the far Southern

provinces. In 2005, the separatists showed signs of stronger organization and more lethal and brutal tactics targeting the government

and the Buddhist population in the South.

Some good news is coming out of Africa. The continent is enjoying real economic growth after a decade of declining per capita income. The past decade has also witnessed a definite, albeit gradual,

trend toward greater democracy, openness and multi-party elections.

In Liberia, the inauguration of Ellen Johnson Sirleaf as President, following a hotly contested multi-party election, was a positive harbinger of a return to democratic rule in a battered nation.

Yet in much of the continent, humanitarian crises, instability

and conflict persist. Overlaying these enduring threats are the potential spread of jihadist ideology amongst disaffected Muslim populations and the region’s growing importance as a source of energy.

We are most concerned about Sudan and Nigeria.

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The signing of a Comprehensive Peace Agreement in Sudan last

year was a major achievement, but the new Government of National Unity is being tested by the continuing conflict in Darfur,

and the instability in Chad is spilling over into western Sudan, further endangering humanitarian workers and assistance supply

lines. Gains in stabilizing and improving the conditions in Darfur

could be reversed if the new instability goes unchecked.

The most important election on the African horizon will be held

in spring of 2007 in Nigeria, the continent’s most populous country

and largest oil producer. The vote has the potential to reinforce a

democratic trend away from military rule, or it could lead to major

disruption in a nation suffering frequent ethno-religious violence,

criminal activity and rampant corruption.

Speculation that President Obasanjo will try to change the constitution so he can seek a third term in office is raising political

tension and, if proven true, threatens to unleash major turmoil and

conflict. Such chaos in Nigeria could lead to disruption of oil supply, secessionist moves by regional governments, major refugee

flows and instability elsewhere in Africa.

To one degree or another, all nations are affected by the phenomenon known as globalization. I’m turning now to the issue of

globalization and rising actors. Many see the United States as

globalization’s primary beneficiary, but the developments subsumed under its rubric operate largely beyond the control of all

countries. Small, medium and large States are both gaining and

losing through technological and economic developments at a rate

of speed unheard of in human history.

Such recalibrations in regional and global standing usually

emerge in the wake of war. But globalization is not a war, even

though its underside—fierce competition for global energy reserves,

discrepancies between rich and poor, criminal networks that create

and feed black markets in drugs and even human beings and the

rapid transmission of disease—has the look of a silent, but titanic

global struggle.

One major recalibration of the global order enabled by

globalization is the shift of world economic momentum and energy

to greater Asia, led principally by the explosive economic growth in

China and the growing concentration of world manufacturing activity in and around it. India, too, is emerging as a new pole of greater Asia’s surging economic and political power. These two Asian giants comprise fully a third of the world’s population—a huge labor

force eager for modern work, supported by significant scientific and

technological capabilities, and an army of new claimants on the

world’s natural resources and capital.

China is a rapidly rising power with steadily expanding global

reach that may become a peer competitor to the United States at

some point. Consistent high rates of economic growth, driven by exploding foreign trade, have increased Beijing’s political influence

abroad and fueled a military modernization program that has

steadily increased Beijing’s force projection capabilities.

China’s foreign policy is currently focused on the country’s immediate periphery, including Southeast and Central Asia, where Beijing hopes to make economic inroads, to increase political influence

and to prevent a backlash against its rise. Its rhetoric toward TaiVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00026 Fmt 6633 Sfmt 6633 C:\DOCS\31316.TXT DianeA PsN: DianeA
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wan has been less inflammatory since Beijing passed its ‘‘anti-secession’’ law last spring. China has been reaching out to the opposition parties on Taiwan and making economic overtures designed to

win favor with the Taiwan public, although Beijing still refuses to

deal with the elected leader in Taipei.

Beijing has also expanded diplomatic and economic interaction

with other major powers—especially Russia and the European

Union—and begun to increase its presence in Africa and Latin

America.

China’s military is vigorously pursuing a modernization program—a full suite of modern weapons and hardware for a large

proportion of its overall force structure; designs for a more effective

operational doctrine at tactical and theater level; training reforms;

and wide-ranging improvements in logistics, administration, financial management, mobilization, and other critical support functions.

Beijing’s greatest challenge is to sustain growth sufficient to keep

unemployment and rural discontent from rising to destabilizing

levels and to maintain increases in living standards.

To do this, China must solve a number of difficult economic and

legal problems. It must improve the education system, reduce environmental degradation, and improve governance by combating corruption. Indeed, China’s rise may be hobbled by systemic problems

and the Communist Party’s resistance to the demands for political

participation that economic growth generates. Beijing’s determination to repress real or perceived challenges—from dispossessed

peasants to religious organizations—could lead to serious instability at home and less effective policies abroad.

Turning now to India, rapid economic growth and increasing

technological competence are securing India’s leading role in South

Asia, while helping India to realize its long-standing ambition to

become a global power. India’s growing confidence on the world

stage as a result of its increasingly globalized business activity will

make New Delhi a more effective partner for the United States, but

also a more formidable player on issues such as those before the

World Trade Organization.

New Delhi seeks to play a key role in fostering democracy in the

region, especially in Nepal and Bangladesh, and will continue to be

a reliable ally against global terrorism, in part because India has

been a frequent target for Islamic terrorists, mainly in Kashmir.

India seeks better relations with its two main rivals—Pakistan and

China—recognizing that its regional disputes with them are hampering its larger goals on the world stage. Nevertheless, like China,

India is using its newfound wealth and technical capabilities to extend its military reach.

On the economic front, as Indian multinational corporations become more prevalent, they will offer competition and cooperation

with the United States in fields such as energy, steel, and pharmaceuticals. New Delhi’s pursuit of energy to fuel its rapidly growing

economy adds to pressures on world prices and increases the likelihood that it will seek to augment its programs in nuclear power,

coal technologies, and petroleum exploration. Like Pakistan, India

is outside the nuclear Nonproliferation Treaty.

Let me turn to the issue of threats to global energy security.

24

World energy markets seem certain to remain tight for the foreseeable future. Robust global economic expansion is pushing strong

energy demand growth and, combined with instability in several

oil- producing regions, is increasing the geopolitical leverage of key

producer states such as Iran, Saudi Arabia, Russia and Venezuela.

At the same time, the pursuit of secure energy supplies has become

a much more significant driver of foreign policy in countries where

energy demand growth is surging—particularly China and India.

The changing global oil and gas market has encouraged Russia’s

assertiveness with Ukraine and Georgia, Iran’s nuclear

brinksmanship, and the populist ‘‘petro-diplomacy’’ of Venezuela’s

Hugo Chavez. Russia’s recent but short-lived curtailment of natural

gas deliveries to the Ukraine temporarily reduced gas supplies to

much of Europe and is an example of how energy can be used as

both a political and economic tool. The gas disruption alarmed Europeans, reminding them of their dependence on Russian gas, and

refocused debate on alternative energy sources.

Foreign policy frictions, driven by energy security concerns, are

likely to be fed by continued global efforts of Chinese and Indian

firms to reach new oil field development deals and to purchase

stakes in foreign oil and gas properties. Although some of these

moves may incrementally increase oil-sector investment and global

supplies, others may bolster countries, such as Iran, Syria and

Sudan, that pose significant U.S. national security risks or foreign

policy challenges. For example, in Venezuela, Chavez is attempting

to diversify oil exports away from the United States.

Let me turn now to the security threat from narcotics trafficking.

In addition to the central U.S. national security interest in stemming the flow of drugs to this country, there are two international

threats related to narcotics: First, the potential threat from an

intersection of narcotics and extremism; and second, the threat

from the impact of drugs on those ineffective and unreliable nation

states about which we are so concerned.

Although the worldwide trafficking-terrorist relationship is limited, the scope of these ties has grown modestly in recent years. A

small number of terrorist groups engage the services of or accept

donations from criminals, including narcotics traffickers, to help

raise operational funds. While the revenue realized by extremists

appears small when compared to that of dedicated trafficking organizations, even small amounts of income can finance destructive

acts of terror.

The tie between drug trafficking and extremism is strongest in

Colombia and Afghanistan. Both of Colombia’s insurgencies and

most of its paramilitary groups reap substantial benefits from cocaine transactions. In Afghanistan, the Taliban and the Hizb group

gain at least some of their financial support from their ties to local

opiate traffickers. Ties between trafficking and extremists elsewhere are less robust and profitable. North African extremists involved in the 2004 Madrid bombings reportedly used drug income

to buy their explosives.

Most major international organized crime groups have kept terrorists at arm’s length, although some regional criminal gangs have

supplied fraudulent or altered travel documents, moved illicit earnVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00028 Fmt 6633 Sfmt 6633 C:\DOCS\31316.TXT DianeA PsN: DianeA
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ings, or provided other criminal services to members of insurgent

or terrorist groups for a fee.

Narcotics traffickers and other organized criminals typically do

not want to see governments toppled, but thrive in States where

governments are weak, vulnerable to or seeking out corruption and

unable or unwilling to consistently enforce the rule of law. Nonetheless, a vicious cycle can develop in which a weakened government enables criminals to dangerously undercut the state’s credibility and authority, with the consequence that the investment climate suffers, economic growth withers, black market activity rises,

and fewer resources are available for civil infrastructure and governance.

We are particularly concerned about this cycle in countries on

the other side of the world, such as Afghanistan, Kyrgyzstan, and

Burma, and those close to home, such as in Haiti, Jamaica, and

Mexico. About 90 percent of detected cocaine destined for the

United States was smuggled through the Mexico-Central America

corridor, nearly all Mexican heroin is for the U.S. market, and

Mexico is the primary foreign supplier of marijuana and methamphetamine to the United States.

Let me turn now briefly to the threat from pandemics and

epidemics.

In the 21st century, our intelligence community has expanded

the definition of bio-threats to the United States beyond weapons

to naturally occurring pandemics.

The most pressing infectious disease challenge facing the United

States is the potential emergence of a new and deadly avian influenza strain, which could cause a worldwide outbreak or pandemic.

International health experts worry that avian influenza could become transmissible among humans, threatening the health and

lives of millions of people around the globe.

There are many unknowns about avian flu, but even the specter

of an outbreak could have significant effects on the international

community, on whole societies, military operations, critical infrastructure and diplomatic relations.

Avian flu is not something we can fight alone. An effective response to it is highly dependent on the openness of affected nations

in reporting outbreaks where and when they occur. But for internal

political reasons, a lack of response capability or disinclination to

regard avian influenza as a significant threat, some countries are

not forthcoming.

In close coordination with the Department of Health and Human

Services, the intelligence community therefore is tracking a number of key countries that are or could be especially prone to avian

influenza outbreaks and where we cannot be confident that adequate information will be available through open sources.

The intelligence community also coordinates closely with the Department of Homeland Security and provides input to the National

Biosurveillance Integration System at the Department of Homeland Security.

In conclusion, each of the major intelligence challenges that I

have discussed today is affected by the accelerating change and

transnational interplay that are the hallmarks of 21st century

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globalization. As a direct result, collecting, analyzing and acting on

solid intelligence have become increasingly difficult.

To meet these new and reconfigured challenges, we need to work

hand-in-hand with other responsible nations. Fortunately, the vast

majority of governments in the world are responsible and responsive, but those that are not are neither few in numbers nor lacking

in material resources and geopolitical influence.

The powerful critiques of this Committee, the 9/11 Commission,

and the WMD Commission, framed by statute in the Intelligence

Reform and Terrorism Prevention Act of 2004, and taken to heart

by the dedicated professionals of our intelligence community, have

helped make us better prepared and more vigilant than we were

on that terrible day in September 2001. But from an intelligence

perspective, we cannot rest. We must transform our intelligence capabilities and cultures by fully integrating them from law enforcement through national authorities in Washington to combatant

commanders overseas. The more thoroughly we do that, the more

clearly we will be able to see the threats lurking in the shadow of

the future and ward them off.

Thank you very much, Mr. Chairman. And now I’d be pleased to

try and answer any questions which the Committee might have.

Chairman ROBERTS. Mr. Director, I asked you to make a very

comprehensive statement covering all the threats that you think

endanger our country, not only for the Committee, but for those listening, all the citizens of the United States. You have done that in

a very comprehensive report.

It is under my understanding under the Geneva Convention,

under the heading of ‘‘cruel and inhumane punishment’’ for congressional hearings that last for more than 2 hours, and prior to

questioning, that it would be the thing to do to declare a 5-minute

break, which we will do. And we will resume immediately at the

5-minute mark to start our questions.

[The prepared statement of Director Negroponte follows:]

PREPARED STATEMENT OF HON. JOHN D. NEGROPONTE, DIRECTOR OF INTELLIGENCE

Chairman Roberts, Vice-Chairman Rockefeller, Members of the Committee, thank

you for the invitation to offer my assessment of the threats, challenges, and opportunities for the United States in today’s world.

I am honored to be the first Director of National Intelligence to offer you such

an assessment, and am pleased to note that following my oral testimony, I will answer your questions with the assistance of Mr. Porter Goss, Director of the Central

Intelligence Agency; Lieutenant General Michael D. Maples, Director of the Defense

Intelligence Agency; Mr. Robert Mueller, Director of the Federal Bureau of Investigation; Ms. Carol Rodley, Acting Assistant Secretary of State for Intelligence and

Research; Mr. Charles E. Allen, Chief Intelligence Officer, Department of Homeland

Security; and General Michael Hayden, Principal Deputy Director of National Intelligence.

Let me begin with a straightforward statement of preoccupation shared by all of

us sitting here before you: terrorism is the preeminent threat to our citizens, Homeland, interests, and friends. The War on Terror is our first priority and driving concern as we press ahead with a major transformation of the Intelligence Community

we represent.

We live in a world that is full of conflict, contradictions, and accelerating change.

Viewed from the perspective of the Director of National Intelligence, the most dramatic change of all is the exponential increase in the number of targets we must

identify, track, and analyze. Today, in addition to hostile nation-states, we are focusing on terrorist groups, proliferation networks, alienated communities, charismatic

individuals, narcotraffickers, and microscopic influenza.

27

The 21st century is less dangerous than the 20th century in certain respects, but

more dangerous in others. Globalization, particularly of technologies that can be

used to produce WMD, political instability around the world, the rise of emerging

powers like China, the spread of the jihadist movement, and of course, the horrific

events of September 11, 2001, demand heightened vigilance from our Intelligence

Community.

This morning, then, I will discuss:

• Global jihadists, their fanatical ideology, and the civilized world’s efforts to disrupt, dismantle and destroy their networks;

• The struggle of the Iraqi and Afghan people to assert their sovereignty over insurgency, terror, and extremism;

• WMD-related proliferation and two states of particular concern, Iran and North

Korea;

• Issues of political instability and governance in all regions of the world that affect our ability to protect and advance our interests; and

• Globalization, emerging powers, and such transnational challenges as the geopolitics of energy, narcotrafficking, and possible pandemics.

In assessing these themes, we all must be mindful of the old dictum: forewarned

is forearmed. Our policymakers, warfighters, and law enforcement officers need the

best intelligence and analytic insight humanly and technically possible to help them

peer into the onrushing shadow of the future and make the decisions that will protect American lives and interests. This has never been more true than now with US

and Coalition forces in Iraq and Afhanistan—and the citizens and fledgling governments they help to protect under attack. Addressing threats to their safety and providing the critical intelligence on a myriad of tactical and strategic issues must be—

and is—a top priority for our Intelligence Community.

But in discussing all the many dangers the 21st century poses, it should be emphasized that they do not befall America alone. The issues we consider today confront responsible leaders everywhere. That is the true nature of the 21st century:

accelerating change affecting and challenging us all.

THE GLOBAL JIHADIST THREAT

Collaboration with our friends and allies around the world has helped us achieve

some notable successes against the global jihadist threat. In fact, most of al-Qa’ida’s

setbacks last year were the result of our allies’ efforts, either independently or with

our assistance. And since 9/11, examples of the high level of counterterrorism efforts

around the world are many. Pakistan’s commitment has enabled some of the most

important captures to date. Saudi Arabia’s resolve to counter the spread of terrorism has increased. Our relationship with Spain has strengthened since the

March 2004 Madrid train bombings. The British have long been our closest

counterterrorism partners the seamless cooperation in the aftermath of the July attacks in London reflected that commitment while Australia, Canada, France and

many other nations remain stout allies. Nonetheless, much remains to be done; the

battle is far from over.

Jihadists seek to overthrow regimes they regard as ‘‘apostate’’ and to eliminate

US influence in the Muslim world. They attack Americans when they can, but most

of their targets and victims are fellow Muslims. Nonetheless, the slow pace of economic, social, and political change in most Muslim majority nations continues to fuel

a global jihadist movement. The movement is diffuse and subsumes three quite different types of groups and individuals:

• First and foremost, al-Qa’ida, a battered but resourceful organization;

• Second, other Sunni jihadist groups, some affiliated with al-Qa’ida, some not;

• Third, networks and cells that are the self-generating progeny of al-Qa’ida.

Al-Qa’ida Remains Our Top Concern. We have eliminated much of the leadership

that presided over al-Qa’ida in 2001, and US-led counterterrorism efforts in 2005

continue to disrupt its operations, take out its leaders and deplete its cadre. But

the organization’s core elements still plot and make preparations for terrorist

strikes against the Homeland and other targets from bases in the Pakistan-Afghanistan border area; they also have gained added reach through their merger with the

Iraq-based network of Abu Mus’ab al-Zarqawi, which has broadened al-Qa’ida’s appeal within the jihadist community and potentially put new resources at its disposal.

Thanks to effective intelligence operations, we know a great deal about al-Qa’ida’s

vision. Zawahiri, al-Qa’ida’s No. 2, is candid in his July 2005 letter to Zarqawi. He

portrays the jihad in Iraq as a stepping-stone in the march toward a global caliphate, with the focus on Egypt, Syria, Jordan, Lebanon, Saudi Arabia, the Gulf states,

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and Israel. Zawahiri stresses the importance of having a secure base in Iraq from

which to launch attacks elsewhere, including in the US Homeland.

In Bin Ladin’s recent audio tape, al-Qa’ida’s top leader reaffirms the group’s commitment to attack our Homeland and attempts to reassure supporters by claiming

that the reason there has been no attack on the US since 2001 is that he chose not

to do so. This week’s statement by Zawahiri is another indication that the group’s

leadership is not completely cutoff and can continue to get its message out to followers. The quick turnaround time and the frequency of Zawahiri statements in the

past year underscore the high priority al-Qa’ida places on propaganda from its most

senior leaders.

Attacking the US Homeland, US interests overseas, and US allies—in that

order—are al-Qa’ida’s top operational priorities. The group will attempt high-impact

attacks for as long as its central command structure is functioning and affiliated

groups are capable of furthering its interests, because even modest operational capabilities can yield a deadly and damaging attack. Although an attack using conventional explosives continues to be the most probable scenario, al-Qa’ida remains interested in acquiring chemical, biological, radiological, and nuclear materials or

weapons to attack the United States, US troops, and US interests worldwide.

Indeed, today, we are more likely to see an attack from terrorists using weapons

or agents of mass destruction than states, although terrorists’ capabilities would be

much more limited. In fact, intelligence reporting indicates that nearly 40 terrorist

organizations, insurgencies, or cults have used, possessed, or expressed an interest

in chemical, biological, radiological, or nuclear agents or weapons. Many are capable

of conducting simple, small-scale attacks, such as poisonings, or using improvised

chemical devices.

Al-Qa’ida Inspires Other Sunni Jihadists. The global jihadist movement also subsumes other Sunni extremist organizations, allied with or inspired by al-Qa’ida’s

global anti-Western agenda. These groups pose less danger to the US Homeland

than does al-Qa’ida, but they increasingly threaten our allies and interests abroad

and are working to expand their reach and capabilities to conduct multiple and/or

mass-casualty attacks outside their traditional areas of operation.

Jemaah Islamiya (JI) is a well organized group responsible for dozens of attacks

killing hundreds of people in Southeast Asia. The threat of a JI attack against US

interests is greatest in Southeast Asia, but we assess that the group is committed

to helping al-Qa’ida with attacks outside the region.

The Islamic Jihad Union (IJU), which has allied itself with al-Qa’ida, operates

in Central Asia and was responsible for the July 2004 attacks against the US and

Israeli Embassies in Uzbekistan.

The Libyan Islamic Fighting Group (LIFG) was formed to establish an Islamic

state in Libya, but since the late 1990s it has expanded its goals to include antiWestern jihad alongside al-Qa’ida. LIFG has called on Muslims everywhere to fight

the US In Iraq.

Pakistani militant groups—primarily focused on the Kashmir conflict represent a

persistent threat to regional stability and US interests in South Asia and the Near

East. They also pose a potential threat to our interests worldwide. Extremists convicted in Virginia in 2003 of providing material support to terrorism trained with

a Pakistani group, Lashkar-i-Tayyiba, before 9/11.

New Jihadist Networks and Cells. An important part of al-Qa’ida’s strategy is to

encourage a grassroots uprising of Muslims against the West. Emerging new networks and cells—the third element of the global jihadist threat reflect aggressive

jihadist efforts to exploit feelings of frustration and powerlessness in some Muslim

communities, and to fuel the perception that the US is anti-Islamic . Their rationale

for using terrorism against the US and establishing strict Islamic practices resonates with a small subset of Muslims. This has led to the emergence of a decentralized and diffused movement, with minimal centralized guidance or control and numerous individuals and small cells—like those who conducted the May 2003 bombing in Morocco, the March 2004 bombings in Spain, and the July 2005 bombings

in the UK. Members of these groups have drawn inspiration from al-Qa’ida but appear to operate on their own.

Such unaffiliated individuals, groups and cells represent a different threat than

that of a defined organization. They are harder to spot and represent a serious intelligence challenge.

Regrettably, we are not immune from the threat of such ‘‘homegrown’’ jihadist

cells. A network of Islamic extremists in Lodi, California, for example, maintained

connections with Pakistani militant groups, recruited US citizens for training at

radical Karachi madrassas, sponsored Pakistani citizens for travel to the US to

work at mosques and madrassas, and according to FBI information, allegedly raised

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funds for international jihadist groups. In addition, prisons continue to be fertile recruitment ground for extremists who try to exploit converts to Islam.

Impact of Iraq on Global Jihad. Should the Iraqi people prevail in establishing

a stable political and security environment, the jihadists will be perceived to have

failed and fewer jihadists will leave Iraq determined to carry on the fight elsewhere.

But, we assess that should the jihadists thwart the Iraqis’ efforts to establish a stable political and security environment, they could secure an operational base in Iraq

and inspire sympathizers elsewhere to move beyond rhetoric to attempt attacks

against neighboring Middle Eastern nations, Europe, and even the United States.

The same dynamic pertains to al-Zarqawi. His capture would deprive the movement

of a notorious leader, whereas his continued acts of terror could enable him to expand his following beyond his organization in Iraq much as Bin Ladin expanded alQa’ida in the 1990s.

Impact of the Islamic Debate. The debate between Muslim extremists and moderates also will influence the future terrorist environment, the domestic stability of

key US partners, and the foreign policies of governments throughout the Muslim

world. The violent actions of global jihadists are adding urgency to the debate within Islam over how religion should shape government. Growing internal demands for

reform in many Muslim countries further stimulate this debate. In general, Muslims

are becoming more aware of their Islamic identity, leading to growing political activism; but this does not necessarily signal a trend toward radicalization. Most Muslims reject the extremist message and violent agendas of the global jihadists. Indeed, as Muslims endorse democratic principles of freedom, equality, and the rule

of law and a role for their religious beliefs in building better futures for their communities, there will be growing opportunities for countering a jihadist movement

that only promises more authoritarianism, isolation, and economic stagnation.

EXTREMISM AND CHALLENGES TO EFFECTIVE GOVERNANCE AND LEGITIMACY IN IRAQ

AND AFGHANISTAN

The threat from extremism and anti-Western militancy is especially acute in Iraq

and Afghanistan.

In discussing Iraq, I’d like to offer a ‘‘balance sheet’’ to give a sense of where I

see things today and what I see as the trends in 2006. Bold, inclusive leadership

will be the critical factor in establishing an Iraqi constitutional democracy that is

both viable as a nation-state and responsive to the diversity of Iraq’s regions and

people.

Let me begin with some of these encouraging developments before turning to the

challenges: • The insurgents have not been able to establish any lasting territorial control;

were unable to disrupt either of the two national elections held this year or the Constitutional referendum; have not developed a political strategy to attract popular

support beyond their Sunni Arab base; and have not shown the ability to coordinate

nationwide operations. • Iraqi security forces are taking on more demanding missions, making incremental progress toward operational independence, and becoming more capable of

providing the kind of stability Iraqis deserve and the economy needs in order to

grow. • Signs of open conflict between extreme Sunni jihadists and Sunni nationalist

elements of the insurgency, while so far still localized, are encouraging and exploitable. The jihadists’ heavy-handed activities in Sunni areas in western Iraq have

caused tribal and nationalist elements in the insurgency to reach out to the Baghdad government for support.

• Large-scale Sunni participation in the last elections has provided a first step

toward diminishing Sunni support for the insurgency. There appears to be a strong

desire among Sunnis to explore the potential benefits of political participation.

But numerous challenges remain.

The Insurgency and Iraqi Security Forces

Iraqi Sunni Arab disaffection is the primary enabler of the insurgency and is likely to remain high in 2006. Even if a broad, inclusive national government emerges,

there almost certainly will be a lag time before we see a dampening effect on the

insurgency. Insurgents continue to demonstrate the ability to recruit, supply, and

attack Coalition and Iraqi Security Forces, and their leaders continue to exploit Islamic themes, nationalism, and personal grievances to fuel opposition to the government and to recruit more fighters.

The most extreme Sunni jihadists, such as those fighting with Zarqawi, will remain unreconciled and continue to attack Iraqis and Coalition forces. These extreme

Sunni jihadist elements, a subset of which are foreign fighters, constitute a small

30

minority of the overall insurgency, but their use of high-profile suicide attacks gives

them a disproportionate impact. The insurgents’ use of increasingly lethal improvised explosive devices (LEDs), and the IED makers’ adaptiveness to Coalition countermeasures, remain the most significant day-to-day threat to Coalition forces, and

a complex challenge for the Intelligence Community.

Iraqi Security Forces require better command and control mechanisms to improve

their effectiveness and are experiencing difficulty in managing ethnic and sectarian

divides among their units and personnel.

Sunni Political Participation

A key to establishing effective governance and security over the next 3 to 5 years

is enhanced Sunni Arab political participation and a growing perception among

Sunnis that the political process is addressing their interests. Sunnis will be focused

on obtaining what they consider their demographically appropriate share of leadership positions in the new government—especially on the Constitutional Review

Commission. Debates over federalism, central versus local control, and division of

resources are likely to be complex. Success in satisfactorily resolving them will be

key to advancing stability and prospects for a unified country. Although the Kurds

and Shia have been accommodating to the underrepresented Sunnis in 2005, their

desire to protect core interests—such as regional autonomy and de-Ba’thification—

could make further compromise more difficult.

In the aftermath of the December elections, virtually all of the Iraq parties are

seeking to create a broad-based government, but all want it to be formed on their

terms. The Shia and the Kurds will be the foundation of any governing coalition,

but it is not yet clear to us whether they will include the main Sunni factions, particularly the Iraqi Consensus Front, or other smaller and politically weaker secular

groups, such as Ayad Allawi’s Iraqi National List. The Sunni parties have significant expectations for concessions from the Shia and Kurds in order to justify their

participation and avoid provoking more insurgent violence directed against Sunni

political leaders.

Governance and Reconstruction

During the coming year, Iraq’s newly elected leadership will face a daunting set

of governance tasks. The creation of a new, permanent government and the review

of the Constitution by early summer will offer opportunities to find common ground

and improve the effectiveness and legitimacy of the central government. There is a

danger, however, that political negotiations and dealmaking will prove divisive. This

could obstruct efforts to improve government performance, extend Baghdad’s reach

throughout the country, and build confidence in the democratic political process.

Let me focus on one of those tasks—the economy. Restoration of basic services

and the creation of jobs are critical to the well-being of Iraqi citizens, the legitimacy

of the new government, and, indirectly, to eroding support for the insurgency. At

this point, prospects for economic development in 2006 are constrained by the unstable security situation, insufficient commitment to economic reform, and corruption.

Iraq is dependent on oil revenues to fund the government, so insurgents continue

to disrupt oil infrastructure, despite the fielding of new Iraqi forces to protect it.

Insurgents also are targeting trade and transportation. Intelligence has a key role

to play in combating threats to pipelines, electric power grids, and personal safety.

Afghanistan

Like Iraq, Afghanistan is a fragile new democracy struggling to overcome deepseated social divisions, decades of repression, and acts of terrorism directed against

ordinary citizens, officials, foreign aid workers, and Coalition forces. These and

other threats to the Karzai government also threaten important American interests—ranging from the defeat of terrorists who find haven along the AfghanistanPakistan border to the suppression of opium production.

Afghan leaders face four critical challenges: containing the insurgency, building

central government capacity and extending its authority, further containing

warlordism, and confronting pervasive drug criminality.

Intelligence is needed to assist, monitor, and protect Afghan, Coalition, and NATO

efforts in all four endeavors.

The volume and geographic scope of attacks increased last year, but the Taliban

and other militants have not been able to stop the democratic process or expand

their support base beyond Pashtun areas of the south and east. Nevertheless, the

insurgent threat will impede the expansion of Kabul’s writ, slow economic development, and limit progress in counternarcotics efforts.

Ultimately, defeating the insurgency will depend heavily on continued international aid; effective Coalition, NATO, and Afghan government security operations

31

to prevent the insurgency from gaining a stronger foothold in some Pashtun areas;

and the success of the government’s reconciliation initiatives.

WEAPONS OF MASS DESTRUCTION AND STATES OF KEY CONCERN: IRAN AND NORTH KOREA

The ongoing development of dangerous weapons and delivery systems constitutes

the second major threat to the safety of our nation, our deployed troops, and our

allies. We are most concerned about the threat and destabilizing effect of nuclear

proliferation. We are also concerned about the threat from biological agents—or

even chemical agents, which would have psychological and possibly political effects

far greater than their actual magnitude. Use by nation-states can still be constrained by the logic of deterrence and international control regimes, but these constraints may be of little utility in preventing the use of mass effect weapons by

rogue regimes or terrorist groups.

The time when a few states had monopolies over the most dangerous technologies

has been over for many years. Moreover, our adversaries have more access to acquire and more opportunities to deliver such weapons than in the past. Technologies, often dual-use, move freely in our globalized economy, as do the scientific

personnel who design them. So it is more difficult for us to track efforts to acquire

those components and production technologies that are so widely available. The potential dangers of proliferation are so grave that we must do everything possible to

discover and disrupt attempts by those who seek to acquire materials and weapons.

We assess that some of the countries that are still pursuing WMD programs will

continue to try to improve their capabilities and level of self-sufficiency over the

next decade. We also are focused on the potential acquisition of such nuclear, chemical, and/or biological weapons—or the production technologies and materials necessary to produce them by states that do not now have such programs, terrorist organizations like al-Qa’ida and by criminal organizations, alone or via middlemen.

We are working with other elements of the US Government regarding the safety

and security of nuclear weapons and fissile material, pathogens, and chemical weapons in select countries.

Iran and North Korea: States of Highest Concern

Our concerns about Iran are shared by many nations, by the IAEA, and of course,

Iran’s neighbors.

Iran conducted a clandestine uranium enrichment program for nearly two decades

in violation of its IAEA safeguards agreement, and despite its claims to the contrary, we assess that Iran seeks nuclear weapons. We judge that Tehran probably

does not yet have a nuclear weapon and probably has not yet produced or acquired

the necessary fissile material. Nevertheless, the danger that it will acquire a nuclear weapon and the ability to integrate it with the ballistic missiles Iran already

possesses is a reason for immediate concern. Iran already has the largest inventory

of ballistic missiles in the Middle East, and Tehran views its ballistic missiles as

an integral part of its strategy to deter—and if necessary retaliate against forces

in the region, including US forces.

As you are aware, Iran is located at the center of a vital—and volatile—region,

has strained relations with its neighbors, and is hostile to the United States, our

friends, and our values. President Ahmadi-Nejad has made numerous unacceptable

statements since his election, hard-liners have control of all the major branches and

institutions of government, and the government has become more effective and efficient at repressing the nascent shoots of personal freedom that had emerged in the

late 1990s and earlier in the decade.

Indeed, the regime today is more confident and assertive than it has been since

the early days of the Islamic Republic. Several factors work in favor of the clerical

regime’s continued hold on power. Record oil and other revenue is permitting generous public spending, fueling strong economic growth, and swelling financial reserves. At the same time, Iran is diversifying its foreign trading partners. Asia’s

share of Iran’s trade has jumped to nearly match Europe’s 40-percent share. Tehran

sees diversification as a buffer against external efforts to isolate it.

Although regime-threatening instability is unlikely, ingredients for political volatility remain, and Iran is wary of the political progress occurring in neighboring Iraq

and Afghanistan. Ahmadi-Nejad’s rhetorical recklessness and his inexperience on

the national and international stage also increase the risk of a misstep that could

spur popular opposition, especially if more experienced conservatives cannot rein in

his excesses. Over time, Ahmadi-Nejad’s populist economic policies could—if enacted—deplete the government’s financial resources and weaken a structurally

flawed economy. For now, however, Supreme Leader Khamenei is keeping conservative fissures in check by balancing the various factions in government.

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Iranian policy toward Iraq and its activities there represent a particular concern.

Iran seeks a Shia-dominated and unified Iraq but also wants the US to experience

continued setbacks in our efforts to promote democracy and stability. Accordingly,

Iran provides guidance and training to select Iraqi Shia political groups and weapons and training to Shia militant groups to enable anti-Coalition attacks. Tehran

has been responsible for at least some of the increasing lethality of anti-Coalition

attacks by providing Shia militants with the capability to build IEDs with explosively formed projectiles similar to those developed by Iran and Lebanese Hizballah.

Tehran’s intentions to inflict pain on the United States in Iraq has been constrained by its caution to avoid giving Washington an excuse to attack it, the clerical leadership’s general satisfaction with trends in Iraq, and Iran’s desire to avoid

chaos on its borders.

Iranian conventional military power constitutes the greatest potential threat to

Persian Gulf states and a challenge to US interests. Iran is enhancing its ability

to project its military power in order to threaten to disrupt the operations and reinforcement of US forces based in the region—potentially intimidating regional allies

into withholding support for US policy toward Iran—and raising the costs of our regional presence for us and our allies.

Tehran also continues to support a number of terrorist groups, viewing this capability as a critical regime safeguard by deterring US and Israeli attacks, distracting

and weakening Israel, and enhancing Iran’s regional influence through intimidation.

Lebanese Hizballah is Iran’s main terrorist ally, which—although focused on its

agenda in Lebanon and supporting anti-Israeli Palestinian terrorists has a worldwide support network and is capable of attacks against US interests if it feels its

Iranian patron is threatened. Tehran also supports Palestinian Islamic Jihad and

other groups in the Persian Gulf, Central and South Asia, and elsewhere.

NORTH KOREA

North Korea claims to have nuclear weapons—a claim that we assess is probably

true—and has threatened to proliferate these weapons abroad. Thus, like Iran,

North Korea threatens international security and is located in a historically volatile

region. Its aggressive deployment posture threatens our allies in South Korea and

US troops on the peninsula. Pyongyang sells conventional weapons to Africa, Asia,

and the Middle East, and has sold ballistic missiles to several Middle Eastern countries, further destabilizing regions already embroiled in conflict And it produces and

smuggles abroad counterfeit US currency, as well as narcotics, and other contraband.

Pyongyang sees nuclear weapons as the best way to deter superior US and South

Korean forces, to ensure regime security, as a lever for economic gain, and as a

source of prestige. Accordingly, the North remains a major challenge to the global

nuclear nonproliferation regimes. We do not know the conditions under which the

North would be willing to fully relinquish its nuclear weapons and its weapons program. Nor do we see signs of organized opposition to the regime among North Korea’s political or military elite.

GOVERNANCE, POLITICAL INSTABILITY, AND DEMOCRATIZATION

Good governance and, over the long term, progress toward democratization are

crucial factors in navigating through the period of international turmoil and transition that commenced with the end of the cold war and that will continue well into

the future. In the absence of effective governance and reform, political instability

often compromises our security interests while threatening new democracies and

pushing flailing states into failure.

I will now review those states of greatest concern to the United States, framing

my discussion within the context of trends and developments in their respective regions.

MIDDLE EAST AND SOUTH ASIA

Middle East. The tensions between autocratic regimes, extremism, and democratic

forces extend well beyond our earlier discussion about Iran, Iraq and Afghanistan

to other countries in the Middle East. Emerging political competition and the energizing of public debate on the role of democracy and Islam in the region could lead

to the opening of political systems and development of civic institutions, providing

a possible bulwark against extremism. But the path to change is far from assured.

Forces for change are vulnerable to fragmentation and longstanding regimes are increasingly adept at using both repression and limited reforms to moderate political

pressures to assure their survival.

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We continue to watch closely events in Syria, a pivotal—but generally unhelpful—

player in a troubled region. Despite the Syrian military withdrawal from Lebanon

last year, Damascus still meddles in its internal affairs, seeks to undercut prospects

for an Arab-Israeli peace, and has failed to crackdown consistently on militant infiltration into Iraq. By aligning itself with Iran, the Bashar al-Asad regime is signaling its rejection of the Western world. Over the coming year, the Syrian regime

could face internal challenges as various pressures—especially the fallout of the

U.N. investigation into the assassination of the former Lebanese Prime Minister—

raise questions about President Bashar al-Asad’s judgment and leadership capacity.

Syria’s exit from Lebanon has created political opportunities in Beirut, but sectarian tensions—especially the sense among Shia that they are underrepresented in

the govenunent—and Damascus’s meddling persist. Bombings since March targeting

anti-Syria politicians and journalists have fueled sectarian animosities.

Egypt held Presidential and legislative elections for the first time with multiple

Presidential candidates in response to internal and external pressures for democratization. The Egyptian public, however, remains discontented by economic conditions, the Arab-Israeli problem, the US presence in Iraq, and insufficient political

freedoms.

Saudi Arabia’s crackdown on al-Qa’ida has prevented major terrorist attacks in

the Kingdom for more than a year and degraded the remnants of the terror network’s Saudi-based leadership, manpower, access to weapons, and operational capability. These developments, the Kingdom’s smooth leadership transition and high oil

prices have eased, but not eliminated, concerns about stability.

HAMAS’ performance in last week’s election ushered in a period of great uncertainty as President Abbas, the Israelis, and the rest of the world determine how to

deal with a majority party in the Palestinian Legislative Council that conducts and

supports terrorism and refuses to recognize or negotiate with Israel. The election,

however, does not necessarily mean that the search for peace between Israel and

the Palestinians is halted irrevocably. The vote garnered by HAMAS may have been

cast more against the Fatah government than for the HAMAS program of rejecting

Israel. In any case, HAMAS now must contend with Palestinian public opinion that

has over the years has supported the two-state solution.

SOUTH ASIA

Many of our most important interests intersect in Pakistan. The nation is a frontline partner in the war on terror, having captured several al-Qa’ida leaders, but also

remains a major source of extremism that poses a threat to Musharraf, to the US,

and to neighboring India and Afghanistan. Musharraf faces few political challenges

in his dual role as President and Chief of Army Staff, but has made only limited

progress moving his country toward democracy. Pakistan retains a nuclear force

outside the Treaty on the Non-Proliferation of Nuclear Weapons and not subject to

full-scope IAEA safeguards and has been both recipient and source—via A.Q. Khan’s

proliferation activities—of nuclear weapons-related technologies. Pakistan’s national

elections scheduled for 2007 will be a key benchmark to determine whether the

country is continuing to make progress in its democratic transition.

Since India and Pakistan approached the brink of war in 2002, their peace process has lessened tensions and both appear committed to improving the bilateral relationship. A number of confidence-building measures, including new transportation

links, have helped sustain the momentum. Still, the fact that both have nuclear

weapons and missiles to deliver them entails obvious and dangerous risks of escalation.

EURASIA

In Russia, President Putin’s drive to centralize power and assert control over civil

society, growing state control over strategic sectors of the economy, and the persistence of widespread corruption raise questions about the country’s direction. Russia

could become a more inward-looking and difficult interlocutor for the United States

over the next several years. High profits from exports of oil and gas and perceived

policy successes at home and abroad have bolstered Moscow’s confidence.

Russia probably will work with the United States on shared interests such as

counterterrorism, counternarcotics, and counterproliferation. However, growing suspicions about Western intentions and Moscow’s desire to demonstrate its independence and defend its own interests may make it harder to cooperate with Russia on

areas of concern to the United States.

Now, let me briefly examine the rest of post Soviet Eurasia where the results in

the past year have been mixed.

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Many of the former Soviet republics are led by autocratic, corrupt, clan-based regimes whose political stability is based on different levels of repression; yet, at the

same time, we have seen in Georgia, Ukraine, and Kyrgyzstan the emergence of

grassroots forces for change.

Central Asia remains plagued by political stagnation and repression, rampant corruption, widespread poverty and widening socio-economic inequalities, and other

problems that nurture nascent radical sentiment and terrorism. In the worst, but

not implausible case, central authority in one or more of these states could evaporate as rival clans or regions vie for power—opening the door to an expansion of

terrorist and criminal activity on the model of failed states like Somalia and, when

it was under Taliban rule, Afghanistan.

LATIN AMERICA

A gradual consolidation and improvement of democratic institutions is the dominant trend in much of Latin America. By the year’s end, ten countries will have

held Presidential elections and none is more important to US interests than the contest in Mexico in July. Mexico has taken advantage of NAFTA and its economy has

become increasingly integrated with the US and Canada. Committed democrats in

countries like Brazil and Chile are promoting economic growth and poverty alleviation. And despite battling persistent insurgent and paramilitary forces with considerable success, Colombia remains committed to keeping on a democratic path. Nonetheless, radical populist figures in some countries advocate statist economic policies

and show little respect for democratic institutions.

In Venezuela, President Chavez, if he wins reelection later this year, appears

ready to use his control of the legislature and other institutions to continue to stifle

the opposition, reduce press freedom, and entrench himself through measures that

are technically legal, but which nonetheless constrict democracy. We expect Chavez

to deepen his relationship with Castro (Venezuela provides roughly two-thirds of

that island’s oil needs on preferential credit terms). He also is seeking closer economic, military, an d diplomatic ties with Iran and North Korea. Chavez has scaled

back counternarcotics cooperation with the US.

Increased oil revenues have allowed Chavez to embark on an activist foreign policy in Latin America that includes providing oil at favorable repayment rates to gain

allies, using newly created media outlets to generate support for his Bolivarian

goals, and meddling in the internal affairs of his neighbors by backing particular

candidates for elective office.

In Bolivia, South America’s poorest country with the hemisphere’s highest proportion of indigenous people, the victory of Evo Morales reflects the public’s lack of

faith in traditional political parties and institutions. Since his election he appears

to have moderated his earlier promises to nationalize the hydrocarbons industry and

cease coca eradication. But his administration continues to send mixed signals regarding its intentions.

Haiti’s interim government is the weakest in the hemisphere and the security climate could continue to deteriorate due to slum gang violence. A failure to renew

the U.N. mandate would greatly increase the risk of a complete nationwide breakdown of public order, intensifying migration pressures. The perception among

would-be migrants that the US migration policy is tough is the most important factor in deterring Haitians from fleeing their country.

SOUTHEAST ASIA

Southeast Asia includes vibrant, diverse, and emerging democracies looking to the

United States as a source of stability, wealth, and leadership. But it is also home

to terrorism, separatist aspirations, crushing poverty, ethnic violence, and religious

divisions. Burma remains a dictatorship, and Cambodia is retreating from progress

on democracy and human rights made in the 1990s. The region is particularly at

risk from avian flu, which I will discuss at greater length in a moment. Al-Qa’idaaffiliated and other extremist groups are present in many countries, although effective government policies have limited their growth and impact.

The prospects for democratic consolidation are relatively bright in Indonesia, the

country with the world’s largest Muslim population. President Yudhoyono is moving

forward to crack down on corruption, professionalize the military, bring peace to the

long-troubled province of Aceh, and implement economic reforms. On the

counterterrorism side, Indonesian authorities have detained or killed significant elements of Jemaah Islamiya (JI), the al-Qa’ida-linked terrorist group, but JI remains

a tough foe.

The Philippines remains committed to democracy despite political turbulence over

alleged cheating in the 2004 election and repeated rumors of coup plots. Meanwhile,

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Manila continues to struggle with the thirty-five year old Islamic and Communist

rebellions, and faces growing concerns over the presence of JI terrorists in the

south.

Thailand is searching for a formula to contain violence instigated by ethnic-Malay

Muslim separatist groups in the far southern provinces. In 2005, the separatists

showed signs of stronger organization and more lethal and brutal tactics targeting

the government and Buddhist population in the south.

AFRICA

Some good news is coming out of Africa. The continent is enjoying real economic

growth after a decade of declining per capita income. The past decade has also witnessed a definite, albeit gradual, trend toward greater democracy, openness, and

multiparty elections. In Liberia, the inauguration of Ellen Johnson Sirleaf as President, following a hotly contested multi-party election, was a positive harbinger of

a return to democratic rule in a battered nation.

Yet, in much of the continent, humanitarian crises, instability, and conflict persist. Overlaying these enduring threats are the potential spread of jihadist ideology

among disaffected Muslim populations and the region’s growing importance as a

source of energy. We are most concerned about Sudan and Nigeria.

The signing of a Comprehensive Peace Agreement in Sudan last year was a major

achievement, but the new Government of National Unity is being tested by the continuing conflict in Darfur, and instability in Chad is spilling over into western

Sudan, further endangering humanitarian aid workers and assistance supply lines.

Gains in stabilizing and improving the conditions in Darfur could be reversed if the

new instability goes unchecked.

The most important election on the African horizon will be held in spring 2007

in Nigeria, the continent’s most populous country and largest oil producer. The vote

has the potential to reinforce a democratic trend away from military rule or it could

lead to major disruption in a nation suffering frequent ethno-religious violence,

criminal activity, and rampant corruption. Speculation that President Obasanjo will

try to change the constitution so he can seek a third term in office is raising political tensions and, if proven true, threatens to unleash major turmoil and conflict.

Such chaos in Nigeria could lead to disruption of oil supply, secessionist moves by

regional governments, major refugee flows, and instability elsewhere in West Africa.

GLOBALIZATION AND RISING ACTORS

To one degree or another, all nations are affected by the phenomenon known as

globalization. Many see the United States as globalization’s primary beneficiary, but

the developments subsumed under its rubric operate largely beyond the control of

all countries. Small, medium, and large states are both gaining and losing through

technological and economic developments at a rate of speed unheard of in human

history.

Such recalibrations in regional and global standing usually emerge in the wake

of war. But globalization isn’t a war, even though its underside—fierce competition

for global energy reserves, discrepancies between rich and poor, criminal networks

that create and feed black markets in drugs and even human beings, and the rapid

transmission of disease—has the look of a silent but titanic global struggle.

One major recalibration of the global order enabled by globalization is the shift

of world economic momentum and energy to greater Asia—led principally by explosive economic growth in China and the growing concentration of world manufacturing activity in and around it. India, too, is emerging as a new pole of greater

Asia’s surging economic and political power. These two Asian giants comprise fully

a third of the world’s population—a huge labor force eager for modem work, supported by significant scientific and technological capabilities, and an army of new

claimants on the world’s natural resources and capital.

CHINA

China is a rapidly rising power with steadily expanding global reach that may become a peer competitor to the United States at some point. Consistent high rates

of economic growth, driven by exploding foreign trade, have increased Beijing’s political influence abroad and fueled a military modernization program that has steadily

increased Beijing’s force projection capabilities.

Chinese foreign policy is currently focused on the country’s immediate periphery,

including Southeast and Central Asia, where Beijing hopes to make economic inroads, increase political influence, and prevent a backlash against its rise. Its rhetoric toward Taiwan has been less inflammatory since Beijing passed its ‘‘anti-secession’’ law last spring. China has been reaching out to the opposition parties on TaiVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00039 Fmt 6633 Sfmt 6621 C:\DOCS\31316.TXT DianeA PsN: DianeA
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wan and making economic overtures designed to win favor with the Taiwan public

although Beijing still refuses to deal with the elected leader in Taipei.

Beijing also has expanded diplomatic and economic interaction with other major

powers—especially Russia and the EU—and begun to increase its presence in Africa

and Latin America.

China’s military is vigorously pursuing a modernization program: a full suite of

modem weapons and hardware for a large proportion of its overall force structure;

designs for a more effective operational doctrine at the tactical and theater level;

training reforms; and wide-ranging improvements in logistics, administration, financial management, mobilization, and other critical support functions.

Beijing’s biggest challenge is to sustain growth sufficient to keep unemployment

and rural discontent from rising to destabilizing levels and to maintain increases

in living standards. To do this, China must solve a number of difficult economic and

legal problems, improve the education system, reduce environmental degradation,

and improve governance by combating corruption.

Indeed, China’s rise may be hobbled by systemic problems and the Communist

Party’s resistance to the demands for political participation that economic growth

generates. Beijing’s determination to repress real or perceived challenges—from dispossessed peasants to religious organizations—-could lead to serious instability at

home and less effective policies abroad.

INDIA

Rapid economic growth and increasing technological competence are securing India’s leading role in South Asia, while helping India to realize its longstanding ambition to become a global power. India’s growing confidence on the world stage as

a result of its increasingly globalized business activity will make New Delhi a more

effective partner for the United States, but also a more formidable player on issues

such as those before the WTO.

New Delhi seeks to play a key role in fostering democracy in the region, especially

in Nepal and Bangladesh, and will continue to be a reliable ally against global terrorism, in part because India has been a frequent target for Islamic terrorists, mainly in Kashmir. India seeks better relations with its two main rivals—Pakistan and

China—recognizing that its regional disputes with them are hampering its larger

goals on the world stage. Nevertheless, like China, India is using its newfound

wealth and technical capabilities to extend its military reach.

On the economic front, as Indian multinationals become more prevalent, they will

offer competition and cooperation with the United States in fields such as energy,

steel, and pharmaceuticals. New Delhi’s pursuit of energy to fuel its rapidly growing

economy adds to pressure on world prices and increases the likelihood that it will

seek to augment its programs in nuclear power, coal technologies, and petroleum

exploration. Like Pakistan, India is outside the Nonproliferation Treaty.

THREATS TO GLOBAL ENERGY SECURITY

World energy markets seem certain to remain tight for the foreseeable future. Robust global economic expansion is pushing strong energy demand growth and—combined with instability in several oil producing regions—is increasing the geopolitical

leverage of key energy producer states such as Iran, Saudi Arabia, Russia, and Venezuela. At the same time, the pursuit of secure energy supplies has become a much

more significant driver of foreign policy in countries where energy demand growth

is surging—particularly China and India.

The changing global oil and gas market has encouraged Russia’s assertiveness

with Ukraine and Georgia, Iran’s nuclear brinksmanship, and the populist ‘‘petrodiplomacy’’ of Venezuela’s Hugo Chavez. Russia’s recent but short-lived curtailment

of natural gas deliveries to Ukraine temporarily reduced gas supplies to much of

Europe and is an example of how energy can be used as both a political and economic tool. The gas disruption alarmed Europeans—reminding them of their dependence on Russian gas—and refocused debate on alternative energy sources.

Foreign policy frictions, driven by energy security concerns, are likely to be fed

by continued global efforts of Chinese and Indian firms to ink new oilfield development deals and to purchase stakes in foreign oil and gas properties. Although some

of these moves may incrementally increase oil sector investment and global supplies,

others may bolster countries such as Iran, Syria, and Sudan that pose significant

US national security risks or foreign policy challenges. For example, in Venezuela,

Chavez is attempting to diversify oil exports away from the US.

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THE SECURITY THREAT FROM NARCOTICS TRAFFICKING

In addition to the central US national security interest in stemming the flow of

drugs to this country, there are two international threats related to narcotics: first,

the potential threat from an intersection of narcotics and extremism; and second,

the threat from the impact of drugs on those ineffective and unreliable nation states

about which we are so concerned.

Although the worldwide trafficking-terrorist relationship is limited, the scope of

these ties has grown modestly in recent years. A small number of terrorist groups

engage the services of or accept donations from criminals, including narcotics traffickers, to help raise operational funds. While the revenue realized by extremists appears small when compared to that of the dedicated trafficking organizations, even

small amounts of income can finance destructive acts of terror.

The tie between drug trafficking and extremism is strongest in Colombia and Afghanistan. Both of Colombia’s insurgencies and most of its paramilitary groups reap

substantial benefits from cocaine transactions. In Afghanistan, the Taliban and

Hizb-i Islami Gulbudin gain at least some of their financial support from their ties

to local opiates traffickers. Ties between trafficking and extremists elsewhere are

less robust and profitable. North African extremists involved in the 2004 Madrid

train bombings reportedly used drug income to buy their explosives.

Most major international organized crime groups have kept terrorists at arm’s

length, although some regional criminal gangs have supplied fraudulent or altered

travel documents, moved illicit earnings, or provided other criminal services to

members of insurgent or terrorist groups for a fee.

Narcotics traffickers—and other organized criminals—typically do not want to see

governments toppled but thrive in states where governments are weak, vulnerable

to or seeking out corruption, and unable—or unwilling—to consistently enforce the

rule of law. Nonetheless, a vicious cycle can develop in which a weakened government enables criminals to dangerously undercut the state’s credibility and authority

with the consequence that the investment climate suffers, economic growth withers,

black market activity rises, and fewer resources are available for civil infrastructure

and governance.

We are particularly concerned about this cycle in countries on the other side of

the world, such as Afghanistan, Kyrgyzstan, and Burma, and those close to home,

such as in Haiti, Jamaica, and Mexico. About 90 percent of detected cocaine destined for the US was smuggled through the Mexico-Central America corridor; nearly

all Mexican heroin is for the US market; and Mexico is the primary foreign supplier

of marijuana and methamphetamine to the US.

THE THREAT FROM PANDEMICS AND EPIDEMICS

In the 21st century, our Intelligence Community has expanded the definition of

bio-threats to the US beyond weapons to naturally occurring pandemics. The most

pressing infectious disease challenge facing the US is the potential emergence of a

new and deadly avian influenza strain, which could cause a worldwide outbreak, or

pandemic. International health experts worry that avian influenza could become

transmissible among humans, threatening the health and lives of millions of people

around the globe. There are many unknowns about avian flu, but even the specter

of an outbreak could have significant effects on the international economy, whole

societies, military operations, critical infrastructure, and diplomatic relations.

Avian flu is not something we can fight alone. An effective response to it is highly

dependent on the openness of affected nations in reporting outbreaks where and

when they occur. But for internal political reasons, a lack of response capability, or

disinclination to regard avian influenza as a significant threat, some countries are

not forthcoming. In close coordination with the Department of Health and Human

Services, the Intelligence Community therefore is tracking a number of key countries that are—or could be—especially prone to avian influenza outbreaks and where

we cannot be confident that adequate information will be available through open

sources. The IC also coordinates closely with the Department of Homeland Security

(DHS) and provides input to the national Bio Surveillance Integration System at

DHS.

Conclusion

Each of the major intelligence challenges I have discussed today is affected by the

accelerating change and transnational interplay that are the hallmarks of 21st century globalization. As a direct result, collecting, analyzing, and acting on solid intelligence have become increasingly difficult. To meet these new and reconfigured challenges, we need to work hand-in-hand with other responsible nations. Fortunately,

the vast majority of governments in the world are responsible and responsive, but

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those that are not are neither few in numbers nor lacking in material resources and

geopolitical influence.

The powerful critiques of this Committee, the 9/11 Commission, and the WMD

Commission, framed by statute in the Intelligence Reform and Terrorism Prevention

Act of 2004 and taken to heart by the dedicated professionals of our Intelligence

Community, have helped make us better prepared and more vigilant than we were

on that terrible day in September 2001. But from an intelligence perspective, we

cannot rest. We must transform our intelligence capabilities and cultures by fully

integrating them from local law enforcement through national authorities in Washington to combatant commanders overseas. The more thoroughly we do that, the

more clearly we will be able to see the threats lurking in the shadow of the future

and ward them off.

Thank you very much.

[Recess.]

Chairman ROBERTS. Each Member will be granted 5 minutes,

and we will do a second round if necessary. And we have a closed

session at 2:30.

Mr. Director, last year I asked, the Committee staff to be very

proactive in trying to examine the intelligence community’s capabilities to collect and analyze against very hard targets—I’m talking about Iran, North Korea, China—on the problem of terrorism

and also proliferation. They are very difficult—I don’t have to tell

anybody in the panel about that—and important intelligence targets, none so more than terrorism.

We’ve been engaged on these problems. But I also think as the

DNI, you are the person most responsible for assessing and improving the IC’s intelligence capabilities. I’d like to hear briefly your

impressions of our community’s intelligence capabilities to target

terrorists when you became the Director of DNI, what you’ve done

since; more especially those hard targets that are so hard to penetrate.

Director NEGROPONTE. Thank you, Mr. Chairman. In brief, the

hard targets that you mentioned—terrorism, proliferation, some of

the countries that I was talking about during my testimony—Iran

and North Korea—have the highest collection priority throughout

the intelligence community. We’re embarked on a vigorous plan, directed by the President a year or so ago, to increase our analytical

and collection capability at the CIA and in other agencies. And in

addition to that, upon the recommendation of the Robb-Silberman

report and the WMD Commission, we have created mission managers for the hard target areas.

So we now have a mission manager for North Korea; we have a

mission manager for Iran and so forth. Those intelligence officials

are empowered to bring together the entire intelligence community

and work on a collaborative basis to give those difficult issues the

attention they deserve.

Now, I don’t want to leave you with the illusion that this is any

easier a problem as a result of these efforts, but I want to assure

you—reassure you—that we are working very, very hard on this

question of penetrating the hard targets, and I’m satisfied that

we’re making progress.

Chairman ROBERTS. Especially in regards to the increase and the

reference to human intelligence?

Director NEGROPONTE. Yes, that is a very important area of emphasis; I would say, yes, there’s been a substantial effort in that

area——

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Chairman ROBERTS. Right.

Director NEGROPONTE [continuing]. Both to increase the penetration of the targets and also to increase the base of our capabilities

by increasing recruitment into our human intelligence services.

Chairman ROBERTS. All right. Throwing great fear into my staff

in that I’m going to wing you a question, as opposed to one that’s

prepared, Ms. Rodley, you do a great job over there at INR. INR

usually comes up with a little bit different viewpoint. That’s

healthy.

Mr. Allen, you are a veteran in the intelligence community and

certain to have a great degree of expertise. You are over at Homeland Security—the newest of the agencies—that has come under a

lot of criticism.

My question is to both of you. What are you doing in regards to

an everyday kind of situation? And I would apply that to General

Maples with the DIA and General Hayden in regards to what

you’re doing unless other factors shut you down, which I hope is

not the case, and then you have the DNI here with working groups

that you’re supposed to coordinate that.

And Mr. Goss, who will be before the Committee very quickly to

go over his tenure at the CIA, and we worry about loss of certain

capabilities as well. I worry about the loss of the capability that the

former NSA director had.

And then Mr. Mueller, you—if we pass the PATRIOT Act, if we

don’t re-enact these laws, I know that you want to basically—to

state it as Ronald Reagan did, you know, ‘‘Congress tear down

these walls.’’ So we’re going to try to do that.

But my question is, information access, where all of you share

this information and then it is funneled into the National

Counterterrorism Threat Center so we have a better analytical picture, if you will, of the jigsaw puzzle or, say, connecting the dots—

do you feel in terms of information access that you are making

progress? We hear it down at the center that there’s one computer

on somebody’s desk and then eight others underneath somebody

else’s desk. Where are we on that?

And I’ll ask the Director.

Director NEGROPONTE. First of all, I do think that we’re all working against a common enemy here. I believe the effort is more integrated than it was before, and I think they do know what each

other is doing in this core area of interest.

As far as the integration of information at the National

Counterterrorism Center, I think that’s working apace, and one of

my significant priorities during the past year has been to build

that center up, give it a permanent leadership, grow its staff—

which we are doing—so that it can meet the responsibilities that

it has to carry out.

Now, we also have a senatorially confirmed chief information officer, and also an information sharing executive, and those officials

are working together to improve the information sharing environment across the intelligence community.

But I believe, Senator, that it’s better than it was previously, and

I think that the dots are being connected. Can more be done? Yes,

to be sure. But we’re working on it.

40

Chairman ROBERTS. So Charlie Allen’s left hand knows what Ms.

Rodley’s right hand is doing?

Director NEGROPONTE. Well, when it relates to a problem that

they’re both commonly concerned with. But I’d be happy to let

them answer it.

Chairman ROBERTS. Well, at any rate, thank you for that answer, and I’m glad we’re making progress.

Senator Rockefeller.

Vice Chairman ROCKEFELLER. Thank you, Mr. Chairman.

Mr. Director, in Buffalo, New York, on April 20, 2004—I would

say only 2 years ago—the President of the United States made the

following statement: He said, ‘‘Anytime you hear the U.S. Government talking about wiretaps, it requires’’—and he paused—‘‘a wiretap requires a court order. Nothing has changed, by the way. When

we’re talking about chasing down terrorists, we’re talking about

getting a court order before we do so.’’ And that was the end of that

phrase.

My question to you, sir: Was that statement factually accurate

when the President made it?

Director NEGROPONTE. Senator, as the Chairman said earlier,

there’s going to be both a briefing by Judge Gonzales to the Judiciary Committee next week, as well as a briefing in closed session

by Judge Gonzales and General Hayden to the Committee thereafter, where I think that this question can be thoroughly discussed.

But let me say this about the terrorist surveillance program.

This is a program that was ordered by the President of the United

States with respect to international telephone calls to or from suspected al-Qa’ida operatives and their affiliates. It was therefore ordered in the interest of protecting our Nation against an ongoing

terrorist threat. This was not about domestic surveillance. It was

about dealing with the international terrorist threat in the most

agile and effective way possible. But I don’t think I want to go into

the question any further than that in an open hearing.

Vice Chairman ROCKEFELLER. Well, but we may have more time

to talk this afternoon, then.

And, Mr. Director, the Vice President has stated that the NSA

domestic surveillance program has saved, quote, ‘‘Thousands of

lives.’’ Do you agree with that statement? Are you prepared to explain the basis for this claim? Or if you feel that you cannot talk

in public, would you be willing to talk in closed session this afternoon about that?

Director NEGROPONTE. Certainly it’s been an effective and important program in dealing with the international terrorist threat,

which, as I mentioned this morning in my testimony, is the most

important threat faced by the United States here in the homeland

and to its interests abroad.

If I may, I might ask—with your permission, Senator—General

Hayden to elaborate somewhat in reply to the question that you

have just directed to me.

Vice Chairman ROCKEFELLER. General.

General HAYDEN. Thank you, Senator.

I’ve said before that the program has been successful, that we

have learned information from this program that would not have

been available to us otherwise.

41

Chairman ROBERTS. General, if you can speak right into the

microphone. I’m sorry.

General HAYDEN. I’m sorry.

What I’ve said before is that the program has been successful,

that we have learned information from this program that would not

otherwise have been available, that this information has helped detect and prevent terrorist attacks in the United States and abroad.

The underlying basis of your question, though, Senator, is to put

us in a position of proving a negative—proving that if we hadn’t

done this, if we hadn’t had this knowledge, if these steps hadn’t

been taken, if these actions had not taken place, that something

else would not have happened. That’s very difficult to prove in a

strict linear sense.

Vice Chairman ROCKEFELLER. General, I don’t want to interrupt,

but I only have a short time left. It was the Vice President I was

quoting, not myself.

This is to Director Mueller. And good morning to you, sir. A January 17, New York Times article quotes former and current FBI officials as saying that the Bureau was inundated with leads from

the NSA domestic surveillance program that required hundreds of

investigators to check out thousands of tips a month. According to

officials quoted in the article, the information from the NSA program had uncovered no active al-Qa’ida networks inside the United

States planning attacks.

Now, the President, General Hayden and others have been very

clear in their public statements that the NSA program collects information only against known al-Qa’ida terrorists and their associates.

Without getting into classified specifics, can you confirm to the

Committee that the investigative leads forwarded by the NSA to

the FBI related only to known al-Qa’ida terrorists and their associates?

Director MUELLER. Yes, let me answer that part of the question

I feel I can answer, Senator, and that relates to leads that come

from the NSA. We get a number of leads from the NSA from a

number of programs, including the program that’s under discussion

today. And I can say that leads from that program have been valuable in identifying would-be terrorists in the United States, individuals who were providing material support to terrorists.

But we get any number of leads. Most leads that we get, whether

it be from NSA or overseas from the CIA, ultimately turn out not

to be valid or worthwhile. But in our view, any lead from any

source, any legitimate source, is a lead that has to be pursued, and

we pursue each and every one of them.

Vice Chairman ROCKEFELLER. My time is up, and I thank you.

Chairman ROBERTS. Senator Wyden.

Senator WYDEN. Thank you, Mr. Chairman.

Mr. Director, you didn’t mention Vanuatu, an island nation in

the South Pacific, but you seemed to cover everywhere else. And I

welcome you.

To me, just because effective intelligence gathering requires a

high degree of secrecy, the Bush administration can’t be excused

from reasonable standards of accountability. So I have essentially

two questions to start with with respect to accountability.

42

When it’s been determined that an American monitored under

the NSA eavesdropping program is no longer a threat, what is done

with the information collected on that U.S. person, Mr. Director?

Director NEGROPONTE. Sir, again, I don’t think in this

context——

Senator WYDEN. Well, are there restrictions, are there restrictions on how that information is used?

Director NEGROPONTE. Let me give you a general reply, which I

think goes to your question. Whether you’re talking about one program or another with respect to NSA, those programs are under

the strictest possible oversight.

They’re reviewed legally, with the greatest of care. There are

very senior managers involved in their administration. And as far

as American persons or American individuals are concerned, protections are taken, should their names come up in various kinds of

intelligence that is collected, to minimize and protect their identities. This has been a standard procedure of the NSA for the many,

many years that it’s been in existence.

General Hayden may want to amplify.

Senator WYDEN. Mr. Director, that answer isn’t good enough for

me. That answer is, essentially, ‘‘Trust us. The Congress and the

public just have to trust us.’’ And Ronald Reagan put it very well.

He said, ‘‘Trust, but verify.’’ And we have no way to verify that citizens are being protected the way you have outlined it today.

Now maybe, General Hayden, you want to add to that.

General HAYDEN. Well, sir, I’ll just add, very quickly, this is lawfully acquired signals intelligence. And the body of regulations

under which NSA operates, day in and day out, in terms of protecting U.S. privacy, in terms of protecting information to, from or

about a U.S. person, apply to the use, retention and destruction of

that data.

Senator WYDEN. General, there are virtually no rules on data

mining. You and I have gone into this. This has been documented

by government auditors. We’ll talk more about it privately.

Mr. Director, is it correct that when John Poindexter’s program,

Operation Total Information Awareness, was closed that several of

Mr. Poindexter’s projects were moved to various intelligence agencies?

Director NEGROPONTE. I don’t know the answer to that question.

Senator WYDEN. Do any of the other panel members know this?

The press has reported intelligence officials saying that those programs run by Mr. Poindexter—I and others on this panel led the

effort to close them—we want to know if Mr. Poindexter’s programs

are going on somewhere else. Can anyone answer that? Mr.

Mueller.

Director MUELLER. I have no knowledge of that, sir.

Senator WYDEN. Any other panel members?

General HAYDEN. Senator, I’d like to answer you in closed session.

Senator WYDEN. All right. I will be asking that question in closed

session.

The last question I wanted to ask on this round, Mr. Director,

deals with Iran—very obviously a serious, serious threat.

43

Some frame this as a choice between either bombing the Iranians

or essentially the kind of pitter-patter that goes on at the U.N.

Some have set it up as those are the choices.

I’m wondering about whether there are other options, particularly economic sanctions. And the one that I would be interested

in your thoughts on is the idea of freezing new foreign investment

in Iran, and whether you think freezing new foreign investment in

Iran would cutoff some of the money that they use for their dangerous weapons capability.

Director NEGROPONTE. Well, sir, my focus is, of course, our focus,

in the intelligence community, is on evaluating the threat—the

military threat, the political threat and so forth. So as far as recommendations of a particular option with respect to policy, I think

the question really goes more into the area of what policymakers

might wish to do.

But what I would say is clearly Iran is a part of the international

community. It has important economic relationships, whether it’s

in the oil sector or through imports or through a reliance to a certain degree on foreign investment, and to the extent that its behavior might ultimately bring about some curtailment of those economic activities, that, presumably, is one of the factors that Iran

has to consider as it goes about deciding its policy.

Senator WYDEN. Thank you, Mr. Chairman.

Chairman ROBERTS. We will now go to Senator Warner, with the

exception that I would say that perhaps the Members could direct

their questions to threats faced by our Nation other than the

threats that some seem to think are posed by the members of the

panel.

Senator Warner.

Senator WARNER. Mr. Chairman, thank you very much.

I’d like to commend you, Mr. Negroponte, for your statement. It

was very thorough and comprehensive, and I’ve had the privilege

of sitting here for many, many years listening to statements, and

I would rank yours at the very top. I think it reflects the conscious

effort that you’re making to fulfill these brand new challenges, and

I hope that it is working to your satisfaction.

Is it likely that you’ll come before the Congress for any refinements in the existing law in this session?

Director NEGROPONTE. I don’t believe so, Senator, unless there’s

some technical amendment of some kind that we might seek. But

as far as more substantive ones, my view—and I mentioned this to

the Committee earlier during my confirmation hearing—is I think

I ought to deal with the law as it has been passed, play the cards

that we’ve been dealt, so to speak, and see how it works out. I

haven’t run into any significant roadblocks. I think we’re working

well together. General Hayden has pulled together a program managers’ council of all the 15 that meets twice a month. I think we’re

working through the various issues that the Congress directed us

to work through. But, obviously, if we run into issues that might

require legislation in the future, I wouldn’t hesitate to bring them

up.

Senator WARNER. And I think you’ve forged a respectful and

strong working relationship with the Central Intelligence Agency

under its leadership which we all admire.

44

Could we put this for record? I see a lot of smiles and bowing

of heads.

Director NEGROPONTE. You can’t record smiles on the record.

No, we have an excellent relationship, Mr. Chairman, and we

meet frequently and speak over the phone even more frequently.

Senator WARNER. Mr. Goss, I think you should be on the record

on that also.

Director GOSS. I’m pleased to be on the record, Senator, to echo

exactly those remarks. We have a great working relationship.

Senator WARNER. Let me turn to General Maples. I’ve had a

great deal of respect for you personally and your distinguished career, and now, from an intelligence standpoint, you’re primarily responsible for the security situation in Iraq and Afghanistan and

elsewhere in the world.

Just a historical reference. The actions taken by our Government

together with coalition forces in Iraq initially were the defeat of

Saddam Hussein’s military forces, which was successfully done in

a very short period; there followed this insurgency, which slowly

evolved and then it became a very, very significant situation that

appears now to still be substantial, but contained and being handled by the coalition forces.

A third composition of problems is growing, and it’s of great concern to me, and that is the combination of the criminal elements

which are growing, the corruption, the payoffs, the graft. All of this

is just, in a sense, overlaying the courageous work of coalition

forces, together with the Iraqi forces and the people through their

elections.

It’s almost like it’s pushing Iraq down into a morass. And a lot

of the activities of the coalition forces, particularly the U.S. forces

now, is directly or indirectly dealing with these situations. I’ve

been told through my sources that if you were to quantify it, the

criminal corruption problem now equates to the seriousness of the

insurgency problem.

Would you have a view on that?

General MAPLES. Thank you, Senator, for your question. In directly responding, I’m not sure that the level of criminal engagement is at the level of the insurgency, but I think it’s a very serious

problem. And I see that a great deal of the violence that we are

experiencing in Iraq today does have a relation to a criminal element, as opposed to an insurgent element with a political purpose.

I think that we see that in numerous attacks, particularly on contracting vehicles within the economy. We see individuals who are

being paid very low sums of money to place, for instance, IEDs,

without a political purpose, but, because they receive remuneration

for doing that, becoming essentially a part of the insurgency.

Senator WARNER. That’s fine. Thank you. I want to get one further question in.

General MAPLES. Yes, sir.

Senator WARNER. But you’ve documented a response.

Mr. Ambassador, you said a key to establishing effective government and security over the next 3 to 5 years is enhanced Sunni

Arab political participation and a growing perception among

Sunnis that the political process is addressing their interests. In a

45

sense, that’s to try and bring about a government of the three principal factions, and it is essential to have that foundation in place.

We’re now watching the new government begin to take the reins.

It’s a little early to make any judgments. But this is a critical time,

and we have a very capable U.S. Ambassador there functioning in

many ways.

What is the leverage we can have over a sovereign nation like

Iraq to bring about this conclusion that you’ve put in here, which

is essential to the future success of the coalition of nations that

have expended so much life and blood and treasure to give the

Iraqi people back their nation?

Director NEGROPONTE. First, Senator, I think with respect to

Sunni participation, I’ve been encouraged by recent developments.

I was particularly encouraged last fall when one million more

Sunnis registered to vote in the constitutional referendum than

had been registered for the January 30 election last year. So that,

to me, was a sign of their increased participation. Then the fact

that they didn’t boycott the election. And then, following that, the

Al Anbar province, which is the most predominantly Sunni province in the country, had a very high degree of participation in the

elections that took place on December 15th.

So I think all of that is a sign that some Sunni, at least, are moving away from the course of violence to achieve their political aims

and are opting for the pursuit of political solutions and outcomes.

So this is to the good, and I think now we have to find ways—we,

that is, the Iraqi government and ourselves—have to find ways of

taking advantage of it.

What’s the leverage that we’ve got? Well, of course we’re a good

supportive friend of the government of Iraq. We have 130,000

troops there, and we have a massive economic reconstruction and

assistance program. So I think that, working in partnership with

our Iraqi friends, we can dialog effectively about their political

process, although we have got to recognize that the shape that

their political process is going to take depends, ultimately, on their

own decisions.

Senator WARNER. That’s true. And our President, in his State of

the Union, was absolutely consistent on message about our determination to see this through. But there has to be limitations, and

that government, as it’s coming into being, has to recognize that

there are some limitations.

Director NEGROPONTE. I agree with that.

Senator WARNER. And that’s got to be made clear to them. They

cannot sit there and dither away and put into those particular ministries—Homeland Security, Defense and otherwise—persons who

really don’t measure up to the capabilities required for the functioning government that they need.

Director NEGROPONTE. I agree. And I think I think our Ambassador and the commander of our forces in Iraq are both very effective at conveying those kinds of messages.

Senator WARNER. Good. Mr. Goss, do you have a view on that?

Director GOSS. Senator, thank you.

I do, and I certainly agree. I will assure you that—as much as

I can say in open session—I would like to reinforce in closed session on that point, and it’s simply this: I agree with your observaVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00049 Fmt 6633 Sfmt 6601 C:\DOCS\31316.TXT DianeA PsN: DianeA
46

tion that the security elements of that country are going to be vital

to the opportunity for the institutions of democracy and freedom to

flourish, and having good people who can work in a work in a nonpoliticized or non-sectarian way is going to be essential, and I think

you put your finger on exactly a critical point.

Senator WARNER. Thank you.

Mr. Chairman, I believe my time is up.

Chairman ROBERTS. That is correct.

Senator Levin.

Senator LEVIN. Thank you, Mr. Chairman.

General Hayden, you made a lengthy speech at the National

Press Club about the program that the President authorized in

terms that involved surveillance of communications of American

citizens. And this is what you said, one of the things you said in

your speech, that there are no communications more important to

the safety of this country than those affiliated with al-Qa’ida with

one end in the United States. And I agree with that statement. I

don’t think there is anything more important than that we know

what is in those communications. It’s important we know the extent of those communications as well.

Would you agree with that?

General HAYDEN. Absolutely, sir.

Senator LEVIN. Can you give us an estimate as to the number

of such communications which were tracked by NSA last year? Just

an estimate?

Chairman ROBERTS. Can’t do that.

General HAYDEN. Sorry. Sir, I’d be very uncomfortable doing it

in an open session, and I don’t actually know that number.

Chairman ROBERTS. I think that’s a question, with all due respect, being the one of two here, Senator, who has been briefed,

that would be better answered in the closed session.

Senator LEVIN. Well, Mr. Chairman, the President has said in

open—very open session—the NSA program is one that listens to

a few numbers. That’s what the President said. Now we want to

check on that.

Chairman ROBERTS. It’s highly minimized, I would tell the Senator.

Senator LEVIN. No, excuse me. I’d rather use these minutes, if

I could, with our witnesses here.

Chairman ROBERTS. I will grant you as much time as possible.

I’m just trying to be helpful in terms of a clarification, so——

Senator LEVIN. Thank you. I would really prefer that the witnesses try to clarify this. The President of the United States——

Chairman ROBERTS. Well, then, I won’t be helpful.

Senator LEVIN. May I continue, Mr. Chairman?

Chairman ROBERTS. Certainly.

Senator LEVIN. Secretary Chertoff says if you’re culling through

literally thousands of phone numbers, you wind up with a huge

problem managing the amount of paper. Why is it all right for Secretary Chertoff to talk about thousands of phone numbers, but you

can’t give us or won’t give us in open session an estimate of the

number of those communications?

47

General HAYDEN. Senator, as I said, I’d be uncomfortable doing

it in open session, and I don’t know the precise number. Your question was——

Senator LEVIN. I’m not saying ‘‘precise number.’’ I asked for an

estimate.

General HAYDEN. I cannot give you an estimate of the number

of communications intercepted.

Senator LEVIN. Is it a few or is it thousands?

General HAYDEN. Sir, I’d be very uncomfortable talking about it

in open session.

Senator LEVIN. Do you know?

General HAYDEN. I can’t give you a precise—no, sir——

Senator LEVIN. I didn’t ask for a precise one, General, and you

keep saying ‘‘precise,’’ and I keep saying ‘‘estimate.’’

General Maples, do you know—do you have an estimate as

to——

General MAPLES. Sir, I do not.

Senator LEVIN. Do you know, Ambassador Negroponte? Do you

have an estimate of the number of those communications?

Director NEGROPONTE. No, sir, I do not.

Senator LEVIN. All right. Now do you have an estimate as to the

number of persons who are members of al-Qa’ida or agents of alQa’ida or who are members of affiliated organizations to al-Qa’ida

or their agents—because that’s the test—whose communications

have been intercepted, say, in the last year? Do you have an estimate of the number of persons?

General HAYDEN. Yes, sir, I do know that number, but I’m unable to give it in this kind of an environment, sir.

Senator LEVIN. All right. Will you give us that, then, in closed

session?

General HAYDEN. Sir, that’s part of the briefing that I’ve given

to the Chairman and the Vice Chairman in great detail on multiple

occasions.

Senator LEVIN. Will you give us that number in closed session,

the rest of us that are on the Intelligence Committee?

General HAYDEN. Sir, I’m not at liberty to do that.

Senator LEVIN. Pardon?

General HAYDEN. I’m not at liberty to do that, sir.

Senator LEVIN. All right.

You know, I think the Administration truly wants to have this

both ways. They want to characterize the program in public. The

President says there’s just a few messages that are intercepted.

The head of Homeland Security says thousands of messages. But

we’re not going to be given even an estimate in public.

These are the most important communications—in your words,

General, and I happen to agree with you. I happen to agree with

you that there are no communications more important to the safety

of this country than those affiliated with al-Qa’ida; and yet the extent of those communications is denied this Congress, except for

the four people you’ve talked about, the estimate of the number of

those communications is denied to the American people. I think

that is a double standard. I think this is another example of where

the Administration wants to characterize some underlying information but doesn’t want to be pressed to support those public characVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00051 Fmt 6633 Sfmt 6601 C:\DOCS\31316.TXT DianeA PsN: DianeA
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terizations. And I think it is a denial—I think basically the Administration wants to be unchecked, either by a court or by the Congress.

That’s my statement, and I’m not going to ask for an answer, because I’ve got 3 seconds left.

You gave us the estimate—the Vice President estimated that

thousands of lives have been saved by this program. General, I just

want to know, can you estimate the number of lives that have been

saved by this program?

General HAYDEN. I cannot personally estimate the number of

lives. Again, Senator, as I said, this is about proving a negative.

I think I mentioned in another forum that if somebody had kicked

in Mohammed Atta’s door in lower Maryland in July of 2001, it

would still be very difficult to estimate the number of lives saved.

Senator LEVIN. I agree with you, but yet the Vice President did

that in public, and apparently there’s no way to support that estimate that I know of or that you know of. And my time is up.

Chairman ROBERTS. I think that Senator Bond is next.

I think as to the number of lives that have been saved, it might

have been how many were on the Brooklyn Bridge if it had blown

up, or, for that matter, other threats that——

Senator LEVIN. I agree with you.

Chairman ROBERTS [continuing]. You know, have been thwarted.

I take with great seriousness the questions of the distinguished

Senator, but basically, certain Members of Congress have been informed, including the leadership. And I realize that that does not

fit the concern of the Senator and others, and we will discuss that

at two business meetings and see where we go with that.

The other group that is not informed as to these specific figures

are members of the al-Qa’ida.

Senator Bond.

Senator BOND. Thank you, Mr. Chairman.

Ambassador Negroponte, it’s good to have you here today as the

Director of National Intelligence, along with your key leaders, to

tell us about the threats worldwide. Although I believe that the intelligence reform legislation that created your position in 2004 was

weak at best, I’m committed to working to strengthen your position

so that we have one leader in charge of our intelligence community,

who will be accountable, responsible and have the authority to ensure that we are far less likely to have the unfortunate intelligence

efforts that preceded the disaster of September 11.

We need a strong, active intelligence community in view of today’s threats, and we need a strong, active leader for that intelligence community. And I have confidence that you will be up to

the task. Secretary Rumsfeld last week told a number of us that

what he needs most in support for fighting the war on terror is

good intelligence, and my colleagues and I are committed to helping you give that to him.

Recently I traveled to two areas of the world that I consider to

be the primary fronts in the war on terror—the Middle East and

Southeast Asia. In the Philippines, Indonesia, Thailand, Iraq, Afghanistan and Pakistan, all our intelligence officials to whom I

talked relayed to me their grave concerns over some recent and unVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00052 Fmt 6633 Sfmt 6601 C:\DOCS\31316.TXT DianeA PsN: DianeA
49

fortunate developments that have significantly affected their operations.

Specifically, newspaper articles concerning the alleged detention

of individuals by intelligence officials, the debate and new legislative restrictions concerning interrogation techniques, and the disclosure of the NSA terrorist surveillance program have caused our

leaders in the field to question the support that they believe they

once had in Washington to act aggressively to pursue every lead

that will defend ourselves against the next terrorist attack.

Our leaders in the field relayed to me the difficulty they’ve faced

in assuring their intelligence sources that they and their families

would be protected, particularly in view of the perception that has

arisen that the United States is a Nation that has little regard for

classified information, and leaks secrets with reckless abandon.

It’s my belief that the recent developments have significantly degraded our intelligence capabilities and, thus, made America measurably less safe.

Furthermore, it is abhorrent to me that while we have men and

women putting their lives on the line in the field—my son is a Marine intelligence officer in Iraq—that some are content to play politics with our national security. While some are thinking about scoring political points on matters of intelligence or about trying to

make the current Administration look bad, I believe we should be

focusing on giving the best tools to our people in the field—to people like my son and others—so they can do their jobs and return

home safely.

I believe we can ensure humane, effective intelligence operations

consistent with our freedom-loving Americans without having to

play the blame game and overreacting to isolated aberrant incidents, which should be and are being prosecuted vigorously by the

government, and instead, handcuffing the vast majority of our honorable operators abroad.

I heard a lot of good things from our people in the field. We’ve

made tremendous progress, and Americans can be proud of what

our intelligence people have done in the field. Much of what they’ve

done has been classified, so I hope the public won’t get to know

about all of it. But make no mistake, the rampant leaking, and uncertainty over detainees and intelligence techniques has shaken the

confidence of our intelligence operators in the field. They’re forced

to spend more time thinking about their own professional liability

insurance and watching their backs rather than how to exploit

every possible lead.

So my question to you, Mr. Director, and to Director Goss, is do

you agree with the assessment that I’ve picked up in the field? And

if you do, how can we, as Members of Congress, and how will you,

as intelligence leaders in Washington, take necessary decisive steps

to support our people in the field with the confidence that they

need to lean forward in their intelligence efforts to face the dangerous threats and not to return to the risk-aversion that’s proven

so costly to us in the past?

Director NEGROPONTE. Thank you, Senator.

First of all, I agree with you that anytime sensitive sources and

methods are revealed in the public domain, through press stories

or otherwise, that this carries with it the grave danger of

50

prejudicing or adversely affecting our intelligence operations, and

in many instances lives can be directly at stake.

And I must say that in the 9 months that I’ve been in this job,

one of the greatest disappointments that I personally have had is

experiencing the degree to which people are willing to talk about

classified matters to the public media. And we’ve got to bring that

kind of activity to a stop.

What are we doing? Well, of course, where there are violations

of security practices that take place, we’re seeking to investigate

them as vigorously as possible and prosecute them, if necessary. I’ll

certainly ask Mr. Goss to elaborate on this, but I think you’re right.

It is an issue that affects both our effectiveness and the morale of

our people. But in addition to investigating and penalizing those

who do carry out these kinds of leaks, I think we also have a challenge to the leadership of the intelligence community as a whole to

try and re-instill—and we’re working hard on that—a spirit of

keeping secret what has to be kept secret in our work in intelligence. But I defer to Mr. Goss.

Director GOSS. Senator, thank you very much for your complimentary remarks about the men and women of the intelligence

community overseas. I will pass those along. And I agree with you,

they are fully deserved. I take great pride in associating with those

people.

Secondly, I would simply say that it would be inappropriate for

me to comment on motivation of leaks except as to CIA aspects of

that. And we, of course, have a vibrant counterintelligence capability, which is—with the cooperation of Director Mueller and others—we utilize fully.

I’m sorry to tell you that the damage has been very severe to our

capabilities to carry out our mission. I use the words ‘‘very severe’’

intentionally. That is my belief. And I think that the evidence will

show that.

When I start talking about the disruption to our plans, things

that we have under way, that are being disrupted because of releases to the press or public discussion, when I talk about the risks

to assets, to sources and methods that are no longer viable or usable, or less effective by a large degree, when I talk about the erosion of confidence in our working partners overseas, I’m stung to

the quick when I get questions from my professional counterparts

saying, Mr. Goss, can’t you Americans keep a secret? That is not

the kind of thing that is helpful to building relationships, to doing

some of this very delicate, hard work that we have to do overseas.

As to what we’re doing about it. I can assure you, we have a

strong internal program at the Central Intelligence Agency under

way—has been for some time—to, as the Director of National Intelligence, Ambassador Negroponte, has said, to remind all of our employees that we are the secret agency of the agencies, that we are

entrusted with that responsibility uniquely, and that the men and

women who come aboard are advised of that.

So we have a program of awareness, but we also have an investigation of finding out what leakage, if any, is coming out of that

building. And I’m afraid there is some coming out. I also believe

that there has been an erosion of the culture of secrecy, and we’re

trying to re-instill that.

51

On the external side, I’ve called in the FBI, the Department of

Justice. It is my aim and it is my hope that we will witness a

grand jury investigation with reporters present being asked to reveal who is leaking this information. I believe the safety of this Nation and the people of this country deserve nothing less, and I

thank you for your question.

Senator BOND. I thank you, Mr. Director.

Chairman ROBERTS. Senator Feingold, and welcome to the Committee.

Senator FEINGOLD. Chairman and Mr. Vice Chairman, again, I’m

honored to join the Committee. I sought this position for one overriding reason. We were attacked on September 11th, 2001, by terrorists whom we must defeat. And I agree with the Ambassador;

this fight is our top national priority, and it involves not only our

military power, but also our diplomatic, economic and intelligence

capabilities.

And I have serious concerns about whether this Administration

is fighting terrorism in an effective global and comprehensive manner. By focusing so extensively on Iraq, this Administration seems

to be pursuing a one- or two-country strategy, when al-Qa’ida is actually operating in some 60 countries around the world.

So I am concerned about the terrorist threat in places in Pakistan, Somalia and other parts of Africa, Southeast Asia and elsewhere.

And I’m concerned that the President has taken the position that

he can spy on Americans without a warrant, despite a clear statutory ban. To just respond a bit to what Senator Bond said, I

couldn’t have any higher regard for the need for secrecy, and I

agree that it must be dispiriting for our people in the intelligence

community and the military to suffer from the possibility of leaks.

But these people, who are so dedicated and so brave, also have

the right to know that there are clear rules, that we’re still operating under the rule of law, under the Bill of Rights and the Constitution. And I bet if you asked them, they’d tell you that they

care a great deal about that as well.

Mr. Ambassador, without getting into what the specific programs

might be, can you assure us today that there are not other intelligence collection—and I emphasize collection—programs that you

are aware of and that you are keeping from the full Intelligence

Committee?

Director NEGROPONTE. Senator, I don’t know if I can comment on

that in an open session.

Senator FEINGOLD. Well, we’ll pursue it later today.

Director NEGROPONTE. Yes.

Senator FEINGOLD. Let me move on to the subject that Senator

Wyden brought up and that he and I have worked on together, this

issue of data minding—data mining. I sent you a letter on January

23rd, requesting information about the NSA’s and the intelligence

community’s possible use of data mining technology to analyze telephone and computer communications inside the United States. And

as I’m sure you know, there have been news reports that part of

the NSA’s domestic surveillance program has involved large-scale

data mining of domestic communications.

52

Now I don’t expect that you have the detailed answers to that

letter with you here today. I just want to ask if you would commit

to me today that you will respond promptly to that letter.

Director NEGROPONTE. Yes, I will, and I believe we have a response in preparation, Senator. I was advised of that before I came

up to the hearing.

Senator FEINGOLD. Thank you.

Turning to one of the areas that we were talking about or you

were talking about in your statement, in your prepared opening

statement, you included a passing reference to Somalia. The 2004

State Department terrorism report states that al-Qa’ida operatives

there pose a ‘‘serious threat’’ to American interests in the region

and that a lack of functioning government and a protracted state

of violent instability contributes to making Somalia a potential

launching point for terrorist operations elsewhere.

In your view, have we committed sufficient intelligence resources

to fully understanding and addressing this threat? Is a political solution to Somalia’s problems a necessary component of our

counterterrorism strategy in that region? And if so, what are we

doing to support such a solution?

Director NEGROPONTE. On the first part of your question, Senator, certainly Somalia is on our radar screen, not only in the intelligence community and our diplomatic establishment, but also in

Central Command. I think it’s an issue of concern, as a place where

there are international terrorists and to which international terrorists might gravitate if they were to suffer severe setbacks in a

place like Afghanistan or Iraq.

So we’re very mindful of that threat. I think we’re devoting important resources to it, although——

Senator FEINGOLD. Are they sufficient intelligence resources?

Director NEGROPONTE. Well, they certainly are significant. You

can never quite do enough, but in the order of priorities that we’ve

got, I think we probably have it about right.

On the question of governance and whether they’ve got a government, they’ve had sort of an absence of governance for the past decade, though sometimes you see some emerging signs that they

might pull together some kind of a central government. But I

wouldn’t hold my breath. Obviously, if they could make improvements in their state of governance, that might make it easier to

deal with the issue of international terrorism. That, after all, is one

of the theses of my testimony, that governance and these

transnational threats can be related to each other.

Senator FEINGOLD. Thank you for your answers.

Chairman ROBERTS. Has the Senator concluded?

Senator FEINGOLD. My time’s up. I’d be happy to keep going.

Chairman ROBERTS. Oh, we give new Members at least, you

know, 30 seconds.

Senator FEINGOLD. Great. I’ll take another one.

The national intelligence strategy released by your office last October states, I think quite correctly, that no nation can build a

safer, better world alone. And the strategy involves engaging and

invigorating friendly foreign intelligence services, and you refer to

that in your comments.

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The strategy refers to a strategic plan for our foreign intelligence

relationships so that these relationships help us confront national

security threats. I agree, this is a critically important task, and it

involves a broad range of policy considerations.

Is this strategy being coordinated with the State Department?

And will you work closely with Congress as you develop this strategy?

Director NEGROPONTE. It certainly is being coordinated with the

State Department, and we’d be pleased to inform the Committee of

the steps we’ve taken thus far and consult with you on the way forward.

Whenever it comes to dealing with foreign countries and institutions in those countries, our intelligence agencies work closely with

the United States Ambassadors there in addition to assure the best

possible coordination of this so that we don’t have a dispersion, if

you will, of our effort.

One of my first acts as Director of National Intelligence was to

designate the CIA station chiefs as my representatives in those

countries so that we aren’t stumbling over each other out there,

and that we have a focal point for the coordination of intelligence

relationships with foreign countries in the CIA stations.

Senator FEINGOLD. Thank you again.

Chairman ROBERTS. Senator Feinstein, welcome back.

Senator FEINSTEIN. Thank you very much, Mr. Chairman.

Mr. Negroponte, I just want to associate myself with the comments of our Ranking Member. I serve on both Judiciary as well

as Intelligence, and what we have seen in the last few years is a

defined and consistent stonewalling to prevent the oversight responsibilities of both Committees from being carried out. And I just

want you to know that when the Ranking Member mentioned that

part of the law creating your position also was to hold you above

any political influence, I think that that is something that we feel

very strongly, and I want personally to make that comment to you.

The National Security Act specifies that the executive branch

shall ‘‘ensure that the congressional intelligence Committees are

kept fully and currently informed of the intelligence activities of

the United States, including any significant anticipated intelligence

activity.’’ The only statutory exemption to this is for especially sensitive covert actions, which may be briefed to only eight Members

of Congress.

The Administration is increasing the use of these limited briefings. My question to you is, who determines what information will

be briefed to only eight Members of Congress?

Director NEGROPONTE. Senator, I take very seriously my legal obligations under the National Security Act, which requires me to

keep the congressional Intelligence Committees fully and currently

informed of intelligence activities, to the extent consistent with the

protection of sensitive intelligence sources and methods or other exceptionally sensitive matters.

Senator FEINSTEIN. Respectfully, could you answer my question,

which was, who makes the decision?

Director NEGROPONTE. It’s the President and the Vice President,

Senator.

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Senator FEINSTEIN. Thank you very much. I just wanted to know

who makes the decision. Thank you.

If I could move on, the intelligence reform legislation that created your position also set up an effort to finally solve some of the

information-sharing problems that pre-dated September the 11th. I

understand that the person appointed by the President to lead this

effort, John Russack, resigned last week. I’m very concerned that

this resignation will end any momentum on information sharing

that had been built up, and that the State and local law enforcement will continue to lack the information that they need to find

and stop terrorists.

Will the information-sharing effort meet the statutory timelines?

And will Mr. Russack’s departure mean a change in direction for

the program?

Director NEGROPONTE. Senator, I think we’re striving to the best

of our ability to meet the timelines that have been set. Interim

guidelines or an interim report was sent up to the Senate late last

year. We are taking steps to ensure that this information-sharing

program continues to have momentum, and you can be certain that

we will give it the highest attention at the leadership of the DNI.

General Hayden, my CIO and eventually the program manager,

when we get a new program manager on board, will continue to

give this issue very, very high priority. And I would expect that—

and I would hope that progress on this front will accelerate.

Senator FEINSTEIN. How soon do you believe you’ll have someone

on board?

Director NEGROPONTE. I’ve actually identified an individual, but

it’s a question of clearances and just the processes that we have to

go through to be able to formally bring that individual on board.

Senator FEINSTEIN. And do I understand by your answer that

this will mean that the program will be carried out in the same direction in which it was previously?

Director NEGROPONTE. Yes. I don’t think this is going to have

any policy implications with respect to the direction in which we’ve

been headed.

Senator FEINSTEIN. Thank you.

Director NEGROPONTE. You’re welcome.

Senator FEINSTEIN. The President has stated that the NSA

warrantless electronic surveillance program has been restricted to

cases where one of the members would reasonably be suspected to

be an al-Qa’ida link or affiliate. Those were the words that have

been interchangeably used. I have two questions on this.

What does it mean to be an al-Qa’ida link or affiliate? How is

that connection to al-Qa’ida defined?

And if I’ve been called by Usama bin Ladin or somebody that we

know is attached to him, I presume that NSA would call that a link

to al-Qa’ida; but is anyone I then call linked to al-Qa’ida automatically and, therefore, electronically surveilled, and anyone they call

then linked to al- Qa’ida and electronically surveilled?

Director NEGROPONTE. Ma’am, if I may invite General Hayden to

comment.

Senator FEINSTEIN. Thank you. That’d be fine.

General Hayden.

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General HAYDEN. Yes, ma’am. Thank you. The criteria that are

used by the analyst—and it is done by the analysts, those folks

who are most knowledgeable about al-Qa’ida intent, behavior, communications and so on—is that this analyst, with all the facts

available to him or her at the time, OK?—as a prudent person

would have reason to believe that this communicant is affiliated

with al-Qa’ida. That’s the standard that we use, and that’s the

standard that’s drilled into the individuals who make those kinds

of decisions.

Senator FEINSTEIN. Thank you. The Attorney General has asserted that the President has virtually unchecked authority to protect Americans, regardless of a clear statutory record in opposition.

That legal position would allow the President to issue other orders

in the name of counterterrorism. Has any intelligence agency been

authorized to, or has any agency carried out, the search of the

home of any American suspected to be linked to al-Qa’ida without

a court warrant?

Director NEGROPONTE. I think I’d have to defer to our law enforcement authorities on this, Senator.

Senator FEINSTEIN. Thank you.

Mr. Mueller.

Director MUELLER. Senator, I’m not aware of that happening.

Senator FEINSTEIN. OK. Has any intelligence agency arrested,

detained, rendered or otherwise held any American suspected to be

linked to al-Qa’ida without a court warrant or sufficient cause for

criminal prosecution?

Director MUELLER. I’m sorry, Senator. Can you repeat that question for me?

Senator FEINSTEIN. Sure. Has any intelligence agency been authorized to or has any agency carried out an arrest, detention, rendering, or otherwise held any American suspected to be linked to

al-Qa’ida without a court warrant or sufficient cause for criminal

prosecution?

Director MUELLER. Well, I mean, I’ll try a first response to that.

That’s a very broad question. And looking at all the components,

there are occasions where, whether it be in the criminal arena, the

counterterrorism arena, we make arrests on probable cause without it going through a magistrate first, then you follow up on a

complaint. And I believe in the instances that, certainly, that I’m

aware of, we followed the procedures that are appropriate.

Senator FEINSTEIN. May I ask for the DNI’s response, since the

question had to do with intelligence agencies?

Director NEGROPONTE. Yes, except my principal concern is with

the collection and analysis of national intelligence which is used for

the protection of the homeland. And I’m not aware of any such instances. I really am not.

Senator FEINSTEIN. All right. I’d like to just continue on.

Director NEGROPONTE. Right.

Senator FEINSTEIN. Has any intelligence agency been authorized

to or carried out the killing of anyone on U.S. soil based on a link

to al-Qa’ida?

Director NEGROPONTE. I’m not aware of such a situation, Senator.

Senator FEINSTEIN. Mr. Mueller.

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Director MUELLER. Senator, I’m certainly not aware of such a situation, speaking for the FBI.

Senator FEINSTEIN. My time is up.

Chairman ROBERTS. In a word, yes.

Senator FEINSTEIN. Thank you.

Thank you, Mr. Chairman.

Chairman ROBERTS. Mr. Wyden.

Senator WYDEN. Thank you very much, Mr. Chairman.

In open session, Director Negroponte, I wanted to ask you about

oil, as it relates to terrorists. And here’s my concern. You go to a

gas station in the United States. You pay these huge prices. A portion of that eventually finds its way to foreign governments, particularly Saudi Arabia. The Saudis hand it over to charities, and

the charities back-door it to terrorists who want to kill law-abiding

Americans.

What is being done to try to deal with this, and particularly to

stiffen up the Saudi effort to deal with this problem, which I think

everybody understands is going on. We’re seeing oil purchases in

the United States—they’re in effect terror attacks. And I’d like to

know what is going on with respect to forcing the Saudis to crack

down on how this oil money gets to terrorists who want to kill

Americans.

Director NEGROPONTE. I think, first of all, Senator, since some of

the egregious terrorist acts that were carried out in Saudi Arabia

in recent years, I think starting with 2003 forward, I think there’s

a much greater awareness of the international terrorist threat on

the part of the Saudi authorities and I think we’ve seen a really

strengthened effort to deal with that situation on their part. So I

would say that cooperation has increased. It’s getting better. And

we have a lot of interchange at all levels—law enforcement, intelligence, and so forth.

Senator WYDEN. You no longer think this is a problem?

Director NEGROPONTE. No, that was going to be my second point.

I believe there are private Saudi citizens who still engage in these

kinds of donations. And I think efforts must be made and ways

have to be found to discourage that kind of activity. And I think

there are also certain designated charities and organizations we actually identify as ones to whom monies should not be given.

So, I think it has been a problem. It’s getting better. But it continues to need work.

Senator WYDEN. I’m going to ask you about that in the private

session.

One other question for you, Mr. Director. There have been news

reports this week—there was one in Newsweek Magazine—talking

about American officials being in face-to-face talks with high-level

Iraqi insurgents as part of an effort to look at possible ways to get

peace in the region.

My question is, will you confirm what was in the news reports

this week? And if you will, I particularly want to know what is

being done to address the concerns that I’m sure Shi’a would have

about any such talks.

So, first, will you confirm what’s in Newsweek Magazine? And

second, if this is ongoing—and I will ask you about this also in

closed session as well—what is being done, at least for the public

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record, to deal with what are certain to be Shi’a concerns about any

such talks?

Director NEGROPONTE. Sir, I simply don’t have any comment on

that story.

But as far as the question of Sunni and Shi’a relationships in

Iraq, this is a very delicate balance, if you will. I think that any

efforts to move the political process forward have got to be based

on a desire to take into account all elements—Sunni and Shi’a included—of the Iraqi body politic.

Senator WYDEN. Mr. Chairman, my colleagues didn’t even get

one round, and I appreciate your giving me these extra questions.

Chairman ROBERTS. Senator Rockefeller.

Vice Chairman ROCKEFELLER. Thank you, Mr. Chairman.

Director, last year at this hearing, Porter Goss made the statement—and I think this is probably the subject which is the most

scary in all of this area of intelligence and international security—

that he could not assure the American people, you know, that there

weren’t unaccounted for nuclear weapons or derivatives thereof

that are housed in Russia.

Have they been stolen? Have they been sold? It wasn’t possible

really to say, and I think this is a catastrophically important matter. The U.S. Department of Energy estimated that only 50 percent

of the buildings that house fissile materials in Russia operate

under the highest security standards.

And what I really just want to know is, from either of you gentlemen, whether you feel there has been any improvement in that

area and if we are working collaboratively, not just Nunn-Lugar,

but in other ways, to try and decrease the number available for

purchase by terrorists perhaps, probably, these nuclear weapons or

parts thereof?

Director NEGROPONTE. If I could invite Director Goss.

Director GOSS. Thank you very much, Mr. Vice Chairman.

That is correct. Last year, you asked me if I could account for

all of the unaccounted for nuclear weapons and be sure, therefore,

that the terrorists did not have access or could get one or had one,

and I could not give you that assurance and nor can I today. But

what I can tell you today is I’m a bit more comfortable than I was

a year ago. I’ve had a chance to focus in on the efforts that we are

making and others are making, because this is a well-understood

threat to the civilized world, and I would dare say we’re getting a

good deal more cooperation on this subject than we were before

that understanding was clear.

I would also say that this is an item that probably gets the loudest alarm bell any time our many collectors work, so I am completely satisfied it is attended to. I am not satisfied that we have

the answer that you and I both—that we’d all like to have that we

are 100 percent sure because we just aren’t.

Vice Chairman ROCKEFELLER. But you think that the efforts not

only within our Nation and its national security apparatus, but

also other parts of the world is stronger in effecting results toward

diminishing that supply?

Director GOSS. I believe that personally. You know, I represent

a capabilities organization, but just one of 15. From my perspective, we have got a proportionate number that is correct focused on

58

that, and I think we are doing better. I can’t speak for the rest of

the community, though.

Vice Chairman ROCKEFELLER. It’s interesting, to do better makes

me feel good, but it isn’t until we get the whole thing solved, and

of course, that’s going to take a lot of work and a lot of good faith

and a lot of people.

Director NEGROPONTE. If I could add quickly, Senator,—we have

created an interagency effort to collect and analyze the whereabouts of fissile materials all over the world, and that’s ongoing on

an urgent basis.

Vice Chairman ROCKEFELLER. And I’m glad to hear that.

Director, my final question will be to you, and that is, do you

agree with the statement that I made in my opening remarks that

our Committee Members and our staff are routinely given access

to the details of overseas signals intelligence programs that are

carried out by the NSA?

Director NEGROPONTE. Yes.

Vice Chairman ROCKEFELLER. Yes.

And do you believe that it’s appropriate for the Committee to

have a working understanding of these programs?

Director NEGROPONTE. I do. Yes.

Vice Chairman ROCKEFELLER. Why is it that—you know, if I had

to make my guess—and this is none of my business, and I have no

proof, and so just take it for what it’s worth—that the leak which

everybody is so properly concerned about probably came out of the

executive branch of government.

It surely didn’t come out of Chairman Roberts or Jay Rockefeller.

And my guess would be somewhere in the Department of Justice.

But just take that for what it’s worth.

Do you really believe that fully briefing the NSA matters that

we’re discussing to 40 members of the Intelligence Committees in

the Congress represents some kind of an unacceptable security

risk?

Director NEGROPONTE. Sir, we’re talking about a decision that

was made long before I arrived in this position. And what I was

trying to answer to Senator Feinstein earlier was that there is a

history and a tradition of certain, very small number—very limited

number—of select sensitive programs that the executive branch

and the President and the Vice President over a period of 50 or 60

years have chosen to limit the briefings to a small select group in

the Congress, such as the leadership of the Congress and the chairmanship and the vice chairmen or ranking Members of respective

Committees. And that is what has been done in this particular instance.

Vice Chairman ROCKEFELLER. And I understand——

Director NEGROPONTE. That was the method that was chosen to

deal with this issue. But there were extensive briefings over the

lifetime of this program, I think more than 10. And so, you know,

I think that’s how best I can answer that question.

Vice Chairman ROCKEFELLER. And I understand that, and I’ll

just close with this thought. The top leadership doesn’t usually go

to these meetings. So you’re really talking about Chairman Roberts

and myself and Chairman Hoekstra and Ranking Member Harman. And there may be a long history of this. I’m not aware of

59

that. But there is no history that comports in any way to the intensity of what’s happened as a result of 9/11.

And I just want to make the statement that I think so much

could be worked out—and so many people would probably agree—

if we felt we were being talked to, as is required by law. The Chairman, when he gave his opening statement, talked about ‘‘lawful.’’

And I just really think that the executive branch needs to think

about the fact that laws are laws, and you are specifically placed

under a certain law, and others are placed under certain laws. And

informing the Committee of jurisdiction is one of those laws.

And it simply isn’t being done, in an atmosphere where it needs

to be done, I think, more than ever, in which I would disagree with

Senator Bond, who—this is not fair, to paraphrase him—but to say

that if people are asking questions about this, that somehow

they’re taking their eye off what is deemed to be the ball—and I

think part of the discussion and the history and the future of all

of this is going to be that the executive branch and the legislative

branch have to have a working relationship that in fact fits into

what the laws require.

I think you have nothing to fear from us. You have nothing to

fear from the House. I think it’s almost certain that whatever leaks

came came from the executive branch, and that’s always going to

be a problem. But I just beg you to consider what I say in deep

seriousness and deep sincerity.

Chairman ROBERTS. I think that the Director of the FBI would

like to respond.

Director MUELLER. Senator, if I might, being a component of the

Department of Justice, I want to not leave that remark go

unaddressed in terms of——

Vice Chairman ROCKEFELLER. Yeah, I can understand that.

Director MUELLER. And I’m not certain you have a basis for

pointing a finger. I’m not certain what leak you’re talking about,

and I don’t think it’s fair to point a finger as to the responsibility

of the leak, so I did not want to let that go unaddressed.

Vice Chairman ROCKEFELLER. I understand.

Chairman ROBERTS. We have Senator Feingold on the second

round.

Senator FEINGOLD. Thank you, Mr. Chairman.

Following up on Senator Feinstein’s question, Mr. Negroponte,

and——

Chairman ROBERTS. Oh, sir, I beg your pardon. For some reason,

I have not recognized the first round appearance of the sheriff of

the always powerful Senate Agriculture Committee, Senator

Chambliss.

Senator CHAMBLISS. Thank you, Mr. Chairman.

It used to be powerful before you were Chairman in the House,

and we haven’t recovered, but we’re getting there.

[Laughter.]

Senator CHAMBLISS. I want to follow up on what Senator Rockefeller just said, ladies and gentlemen. This issue relative to this

leak coming out of the executive department or the Administration,

that’s a pretty serious accusation, and, in fact, the only known

source of any communication from the inside has come from an inVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00063 Fmt 6633 Sfmt 6601 C:\DOCS\31316.TXT DianeA PsN: DianeA
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dividual, as I understand it, who used to work in the program and

is not a part of the executive branch.

But I have been very hesitant to talk about the fact—and I assume I’m directing this to either you, Director Mueller, or Director

Goss or Director Negroponte—I’ve been hesitant to talk publicly

about the fact that the position of gathering intelligence and utilizing very classified and sophisticated intelligence has been compromised by not only the leak, wherever it came from, but also by

the continuing highlighting of this issue in the press, and that

those folks who continue to question this program, those folks who

continue to go out front and talk in a negative way about this program may be aiding and abetting the terrorists.

And I am extremely concerned about that.

I understand, Director Goss, that you may have addressed this

in an earlier response to a question from Senator Bond, and I

apologize for not being here. But I would like to ask you all to comment on that, if you will, as to whether or not our position has

been compromised, if we have lost any of our capability relative to

this program as a result of the publicity surrounding it.

Director GOSS. Thank you, Senator, very much. It would only be

appropriate for me to comment about those areas that I have accountability and responsibility for. And I was referring to leaks

that Senator Bond had referred to that went to that area, and explained at some length how damaging they have been and the

steps we are taking to deal with that, and I hope they’ll be successful steps.

NSA is not, obviously, in our area, and so I would prefer to yield

to either Director Mueller, who has the domestic side of the argument, or the Director of National Intelligence for whoever he would

like to appoint to deal with the NSA aspects.

Senator CHAMBLISS. Sure.

General HAYDEN. Senator, it’s hard for me to characterize in

open session. But I did make the comment earlier in another environment that some people claim that somehow or another our capabilities were immune to this kind of information going out into the

public domain. And I can tell you in a broad sense that is certainly

not true.

Senator CHAMBLISS. The bad guys tend to get information that

comes out of Congress or out of the American press in real time.

Is that a fair statement, General Hayden?

General HAYDEN. We have been impressed with their ability with

various Web sites that are generally available and at how agile

they are in responding to events in this country.

Senator CHAMBLISS. Yes.

Director Negroponte, the Secure Border Initiative was introduced

by the Department of Homeland Security in November 2005. And

this is a comprehensive multi-year plan to secure America’s borders

and reduce illegal immigration, which includes increasing the number of Border Patrol agents, as well as upgrading technology used

in controlling the border, increasing manned aerial assets, expanded use of UAVs and next-generation detection technology.

Recent reports suggest that smugglers are either disguising

themselves as Mexican soldiers, or may actually be members of the

Mexican military. How large of a problem is protecting our borders

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from infiltrators who may be receiving assistance from corrupt

Mexican authorities, and what is our intelligence community doing

to identify those collaborators?

Director NEGROPONTE. With your permission, Senator, perhaps I

could invite Mr. Allen from the Department of Homeland Security

to respond to that question.

Senator CHAMBLISS. Sure.

Dr. ALLEN. Thank you. Thank you, Ambassador Negroponte.

Senator, on the Strategic Border Initiatives, as you know, Secretary Chertoff has a number of multi-functional ways to do this.

A number of actions are under way.

I, from an intelligence perspective, am looking at this on how to

strengthen our intelligence collection on all of our borders, wherever they may be. Getting into specifics relating to any reported incidents along the border, that’s something I’d prefer to talk to in

a closed session. But I can say this, that our borders are being

strengthened, whether by land, sea or air, and whether north or

south, thanks to the procedures that are being rapidly put in place

under the leadership of Secretary Chertoff. I think we can take

comfort that we’re well on our way to taking the kind of measures

that the American public really wants to see.

Senator CHAMBLISS. Thank you.

Thank you, Mr. Chairman.

Chairman ROBERTS. It would be the hope of the Chair that we

could at least allow the witnesses an hour for lunch before we go

to the closed session.

So with that in mind, on the second round I recognize Senator

Feingold.

Senator FEINGOLD. Thank you, Mr. Chairman. I’m pleased I went

after my friend, Senator Chambliss, because what I’d like to say is

the greatest publicizing of this NSA program that I’ve heard was

when I sat in front of the President of the United States the other

night at the State of the Union and heard him discussing it in front

of the whole world.

In fact, this is part of a larger effort to discuss this on a constant

basis and to make it a political issue in front of the American people. So I take it his remarks would apply to that sort of conduct

as well.

Mr. Negroponte and General Hayden, following up on Senator

Feinstein’s question, have you defined ‘‘al-Qa’ida affiliate’’ for the

purpose of warrantless NSA surveillance? Is it a term of art? How

are the NSA officials guided on this?

General HAYDEN. It’s a term of science, Senator. It is a specific

list of affiliates. There is a burden of proof that must be met before

an organization is deemed to be affiliated with al-Qa’ida. And that

work is overseen by the entire oversight structure that governs this

program within NSA by the IG, the general counsel, and by the Department of Justice.

Senator FEINGOLD. Thank you, General.

On Pakistan, Mr. Negroponte, the most recent State Department

country reports on terrorism for 2004 state that al-Qa’ida continues

to hide in Pakistan’s federally administrated tribal areas of Pakistan. Who wields power in these regions, and how has al-Qa’ida

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rorist sanctuary? The report also states the Pakistan has pursued

a strategy to win the support of tribes in the FATA with a combination of negotiations and economic investments. Have the Pakistanis achieved any success in this regard?

Director NEGROPONTE. It’s a tough area. It’s a tough area, Senator. And it’s an area that historically has sought to govern itself,

if you will. It’s not felt itself an integrated part of any country or

nation. And a lot of people up there take the law into their own

hands, I think. But I believe the Pakistani Government has done

a lot in recent times to establish a greater presence there. They’ve

sent their military into the region, who operate with greater frequency and have taken a large number of casualties, substantial

casualties in their efforts to impose the writ of the central government.

So I think the situation there is gradually shifting. But it’s proven to be a great challenge for the government of Pakistan. But I

don’t doubt their commitment to fighting against international terrorists, and we’ve seen ample evidence of that over the past months

and years.

Senator FEINGOLD. On Iraq, you state in your opening statement

that Iraqi Sunni-Arab disaffection is the primary enabler of the insurgency. Can you just say a bit more about the range of motivations that inspire the insurgency and the extent to which it is motivated specifically by anti-coalition sentiment?

Director NEGROPONTE. Well, I think the fundamental issue for

those Sunnis who are not international terrorists, who are not part

of al-Qa’ida or Zarqawi’s group, has been a feeling of having been

disempowered as a result of the fall of Saddam Hussein. So I think

that probably is the most significant motivation—the feeling on the

part of many Sunnis that they no longer have the position of prominence in the governance of their society, of their country that they

used to have, and their desire to recuperate some of that influence.

I think what we’re seeing happening in Iraq is these different political forces and political groups finding the right balance among

themselves that will permit their society to go forward in a peaceful manner. And I think the electoral process and the political process that we’re witnessing offers that opportunity.

Senator FEINGOLD. Thank you for all your answers, and thank

you, Mr. Chairman, for the additional time.

Chairman ROBERTS. Yes, sir.

Senator Feinstein.

Senator FEINSTEIN. Thank you, Mr. Chairman.

Mr. Negroponte, we have heard allegations that top officials in

one of the technical intelligence agencies explicitly warned contractors not to talk to Congress about ongoing programs or risk losing

future contract competitions. I know this for a fact.

Are you aware of this? And does Congress have the right, do

we—in my case an appropriator, as well as an authorizer—have

the right to talk to the contractor of major technical programs?

Director NEGROPONTE. Senator, I’m not aware of this particular

situation, but if I may, I would like to know the details, so that I

can have a look at the matter.

Senator FEINSTEIN. I will be happy to give you the details. Thank

you.

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Last year, Admiral Loy, who was present, and I discussed border

security, particularly the increasing problem of penetration of other

than Mexicans across our borders, which are growing in numbers,

and I said at that time that I felt it was a major gateway for terrorists to access the United States.

Do you have ongoing intelligence efforts to prevent this from

happening? And is there any evidence up to this point that it is in

fact happening?

Director NEGROPONTE. I’m going to invite Mr. Allen to elaborate,

but one thing I would like to say, Senator, is of course it’s an issue

that we’re sensitive to, and second, my impression is that perhaps

our border with Canada has to some degree been of a bit greater

concern than that with Mexico. Although, obviously, we have to

watch all of our borders very, very carefully.

But if I could ask Mr. Allen to elaborate?

Dr. ALLEN. Yes, Senator Feinstein, we recognize this issue. As

you know, we have found a lot of individuals other than Mexicans

attempting to cross our borders illegally, and under Secretary

Chertoff’s new policy, which is catch-and-return or deport, this is

having I think a salutary effect. Now, the Strategic Border Initiative is new, and it’s only now getting fully under way, and we’re

very sensitive of the fact that people from other areas—from areas

where we might expect to find members of al-Qa’ida. We are very

sensitive to that. We work extraordinarily hard on this issue.

I think terrorists are facing an increasingly challenging environment to enter our country, certainly by air and by sea. We now

need to secure our borders and, as Ambassador Negroponte said,

we need to work harder.

Senator FEINSTEIN. If I might suggest to you, the numbers in the

past 2 years have tripled. They have gone from fiscal year 2003,

49,545 to 2005, 155,000. Now these are other than Mexicans.

Dr. ALLEN. These are other than Mexicans. We’re aware of those

figures.

Senator FEINSTEIN. So this indicates to me that whatever we’re

doing is not working because more are coming through than ever

before.

Dr. ALLEN. We believe we’ll see a change in that in the coming

months, because the catch-and-return policy I think it will have

salutary effects over time.

We really do have to work this issue a lot harder, and, as it was

said earlier, when I answered Senator Chambliss, we’re using significant new capabilities, including border patrolmen, but significant new advanced technologies to try to detect people entering our

countries, particularly in Texas and Arizona.

Senator FEINSTEIN. Well, thank you very much for that.

Dr. ALLEN. Yes, ma’am.

Senator FEINSTEIN. Mr. Negroponte, recent media reports have

spotlighted a number of activities that appear to be related to intelligence collection or covert action, but that well maybe outside of

the official intelligence community’s channels; for example, military

data bases of suspicious activity reports called Talons by the Counterintelligence Field Activity or CIFA, and second, a Pentagon program to secretly pay Iraqi newspapers to run pro-American articles.

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Were these activities subject to your approval and oversight?

General MAPLES. Ma’am, I don’t believe that either of those activities would fall into Mr. Negroponte’s area. They are Department

of Defense programs.

Senator FEINSTEIN. Let me raise this problem, then. They

should. We appointed you to be the—we didn’t appoint you, but we

created the legislation so that you were the person over all intelligence. Now, I know how tough it is, but this gives—if you didn’t

know and you didn’t give a go-ahead, it indicates to me that for 85

percent of the budget which is defense-related, that you’re not

going to have the controls that you should have. You want to comment?

Director NEGROPONTE. Well, CIFA is within the national intelligence program, but as far as specifically directing those activities,

that has not risen to the level of my office and comes under the

direction of the Under Secretary of Defense for Intelligence. And

my understanding, in light of the issues that have come up and the

controversy and the press attention that has been given to CIFA,

that Mr. Cambone has ordered a complete review of that program

from top down.

Senator FEINSTEIN. Well, will you get the results of that review?

Director NEGROPONTE. Yes, I will get those results.

Senator FEINSTEIN. Will you be able to play a decision-making

role in that, or does Defense control it?

Director NEGROPONTE. Well, to the extent that I have reporting

to me a national counterintelligence executive and have a role in

counterintelligence, yes.

Senator FEINSTEIN. Thank you.

Thank you, Mr. Chairman.

Chairman ROBERTS. Let me just say that our staff has been

briefed by the DOD and that I would encourage the Senator to

check with staff on both sides, and that we have looked at this very

carefully, and I think some of the concerns that she has raised,

which obviously should be shared by everybody, you know, have

been answered.

Let me just say this in closing. First, I want to thank you for

your patience. Second, we are going to welcome you to the closed

session. Third, I hope you at least get to eat a sandwich.

Let me make an observation. Since the enactment of the provision requiring the Intelligence Committees be kept fully and currently informed, that the Committees and the Presidents—and I

use ‘‘the President’’ in plural—have always managed the delicate

process of access to information. To claim this situation is somehow

different ignores this Committee’s history and the text of our laws.

Now, I know this happened under President Carter, I know this

happened under President Reagan, I know this happened under

President Bush-one, I know this happened under President Clinton, and I know this happened under President Bush. And basically the law, at least in the way that I have read it, indicates that

the executive has the prerogative and also has the responsibility of

keeping the Congress informed. The practice, however, has been

that there are certain programs that are so highly classified that

they are limited to eight—i.e., the leadership of the House and SenVerDate 11-MAY-2000 12:04 Feb 27, 2007 Jkt 031316 PO 00000 Frm 00068 Fmt 6633 Sfmt 6601 C:\DOCS\31316.TXT DianeA PsN: DianeA
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ate and also the Ranking Member and, in this particular case, the

co-Chair and the Chair of the Intelligence Committees.

On some occasions, if it involves the military in some kind of a

covert operation, the same thing applies to Armed Services and the

Subcommittee on Armed Services in regards to the Subcommittee

on Appropriations.

Now, I know there is a great hue and cry that we make more

people pregnant with the knowledge, and then, of course, if they’re

pregnant with the knowledge, they will rock the baby, as opposed

to throwing it out with the bath water. But let me say that we did

that.

Immediately after 9/11, we thought it was our obligation on the

Intelligence Committees, under different leadership at that particular time, to have a joint investigation, which we did. We even

had an independent staff, forcing Members to come to the meeting

and act as if they were studying for a chemistry test during a study

hall because we quite never knew what to expect. Now, that’s sort

of telling tales out of school, but I didn’t think that was a very

helpful operation.

It wasn’t any time at all with the joint Committees—and I’m not

trying to perjure anybody or the Committees or the intent of Congress or the integrity of Congress—before we had a leak. Now, the

leak had nothing to do with 9/11, but boy, it sure made the headlines. And the executive made a decision at that particular time:

I’m not going to—or we are not going to share any information or

send anybody down to testify further if we have leaks of this nature.

And so the leadership of that Committee, the Joint Committee

Investigation on 9/11, made a decision—or agreed to the executive

that there would be an FBI investigation of the Committee. At the

same time, the Committee was investigating the FBI’s role in 9/11.

So here we were in a joint committee investigating the FBI, and

then the FBI investigating us and asking every Member of the Intelligence Committees—both House and Senate—would you take a

lie detector test?

I can’t think of anything more ridiculous or silly. I will say, as

Chairman of this Committee, that if somebody asked me to do that,

my answer is no.

And the result was that what we really needed in that group—

and I’m not comparing that particular group because I was a Member of it—and then, of course, everybody said it was staff. Members

always say that it’s staff. And I said that’s a lot of nonsense. What

we ought to do is have Members, when they walk out of the room,

put duct tape on and have a requirement that they at least wear

the duct tape for 24 hours.

Now, that was the worry that happened under this Administration, and previous Administrations, when these briefings got to a

larger group.

Now, I would agree with Vice Chairman Rockefeller, I don’t know

of anybody on our Committee, I don’t know of anybody on the

House Committee that would willingly or wittingly repeat any information that would be so classified that it would endanger our

country.

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Now, my question is, however, there’s been a lot of comment

about the President, you know, talking about this, the Vice President talking about this. It was only after the leak in The New York

Times, which contained a lot of misinformation, as far as I’m concerned, about domestic spying, when we really have a threat warning capability—and that’s what we’re talking about, it’s more of a

military mission than it is any kind of a criminal proceeding under

FISA. And FISA, by the way, is outdated in regards to its context

with both the threat and the technology. And were we to do that,

we would lose not only minutes, but hours or days when we have

a threat that may happen immediately. And it would be an amazing thing to me that if we had another attack, the very people that

are doing all the questioning now would be having you all back up

and say, ‘‘How come you didn’t know?’’

Now, my question is basically to General Hayden. What happens

if you lose this capability, General?

General HAYDEN. It’s proven to be a very valuable tool for that

which it was intended—to detect and prevent attacks inside the

United States, Senator.

And you’re right about the firestorm of misinformation that

seemed to follow day after day after the original leak was reported

in The New York Times. I’ve spoken to this Committee—I think it

was in this room—in October of 2002, talking about the line between liberty and security, and how that had to be an informed debate by the American people so that we’re all comfortable about

that line.

And there was so much inaccurate information, misinformation

and misunderstanding out there that what was appearing in the

press wasn’t informing a debate; it was horribly misshaping it. And

I don’t see how we, as a free people, can make a decision in that

way.

Chairman ROBERTS. Well, I really regret that situation is happening, and I know that it is understandable, both on the majority

side and the minority side, that we have differences of opinion. And

unfortunately, the climate in the Congress today, then, is to ascribe

politics as the reason for that. I really think people have strong differences of opinion. But fortunately or unfortunately, in regards to

the number of people who are briefed, I think it’s basically on the

lack of information, and the lack of information in regard to exactly

what this program is.

And I cannot imagine how anybody who would be receiving a call

from a terrorist cell, where we have reason to believe that they are

going to attack the United States, and that person happened to be

in the United States, that they would think their civil liberty was

being violated if some intelligence or law enforcement person was

not monitoring that call. It would be indefensible if we did not.

And in addition, I would only point out that you really don’t have

any civil liberties if you’re dead.

The other thing that I would say is that I want to thank you

again, all of you, for your dedication, your perseverance, for keeping this country safe, as opposed to some, who obviously are more

worried about you people, apparently, than some people who—

where we are at war and where we have a threat and where we

have plots against the United States and where we have sleeper

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cells in the United States. And it could happen at any moment.

Thank God we have this capability.

This hearing is concluded.

Vice Chairman ROCKEFELLER. I need to respond, Mr. Chairman.

Chairman ROBERTS. You may respond.

Vice Chairman ROCKEFELLER. And let me just ask a question

first to the Director. Is the NSA program a covert action program,

as defined by the National Security Act?

Director NEGROPONTE. I don’t believe so, sir, no.

Vice Chairman ROCKEFELLER. And that’s what we were told yesterday by the folks from Justice, that it is not.

Now as to the horror of people wanting to do things both rigorously, aggressively, using intelligence, in every possible way that

we can, it does not subtract, however, from two other concepts

which have kept our Nation viable for many, many, many years.

And that is that we do things under the law. We do them under

the law.

Secondly—and I’ve made this point many times to the Chairman;

we’ve talked about it—there is an instinct readily grabbed upon by

some that when we ask questions about the largest NSA program

in history, that somehow we are attacking you gentlemen and ladies. Nothing could be further from the truth, because the instructions or whatever come from elsewhere. That’s been stipulated.

It is simply important that in a democracy we understand there

are three branches of government. I spend an enormous amount of

my time—the Chairman’s leaving—an enormous amount of my

time, well over three-quarters, working exclusively on this subject

in great depth with great intensity, do a lot of traveling, and meet

the same intelligence folks that Senator Saxby Chambliss was talking about, and Kit Bond, I guess it was.

But you cannot equate, and you should not equate, asking questions where we are meant to be informed by law, as the Intelligence Committees, and we are not, for pursuing that effort, because to do otherwise is to say that there’s no reason for these

Committees to exist, and that we should disband the Committees,

which I am not for doing.

But do not kid yourselves, gentlemen and ladies. It is often said

that the Chairman and the Ranking Member of each of the Committees are fully briefed, and therefore, you know, everything is

fine. That’s not the way it works, that’s not the way those meetings

work. And General Hayden knows that. They don’t last long

enough, the flip charts are extensive, and everybody’s in a hurry.

The leadership usually doesn’t come. Chairman Roberts and I do

come, as well as the House members; 4 people out of 535 therefore

know about the most extensive and aggressive NSA effort in the

history of this country.

I am strongly for the goals. But I want it to be done under the

law. And so should you. That’s what keeps our country together.

Thank you.

Director NEGROPONTE. If I may just—one sentence, Senator. I

know the Attorney General will address this next week. But we believe that all these activities are being undertaken in full compliance with our Constitution and with the laws of our country. And

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that is an oath that each and every one of us at this table have

undertaken.

[Whereupon, at 1:50 p.m., the Committee adjourned.]

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