Retaking the Strategic Initiative

on Transnational Terrorism
A Team 2 Interim Report:
Intelligence Issues for Commission Discussion
 This Briefing

Team 2's Responsibilities

The Problem
Central Issue
Findings & Causes
Options
Next Steps

2/9/2004
 Team 2 Responsibilities

Our part of the investigation

• US intelligence performance in the years leading up to 9-11
• Collection, Analysis, and Management
• Terrorism Threat Integration Center
• Congressional Oversight
• Resources
Not responsible for investigating
• What the government knew about UBL or al Qa'ida (Team 1)
. The 9-11 plot (Team 1 A)
• planning and execution (Team 3)
• Terrorist financing (Team 4)
• Intelligence in the Department of Homeland Security (Team 6)

2/9/2004
 The Problem
The 21st Century national security environment differs
radically from the Cold War environment
Policymakers and US intelligence leadership are still
struggling to adapt to revolutionary change
A decentralized "Intelligence Community" lacks the agility
and flexibility to address transnational threats and is not
adapting fast enough to the new challenges

2/9/2004
 Central Issue

Should the nation centralize intelligence under one authority to

retake the strategic initiative on transnational terrorism as well
as other 21 st Century threats?

2/9/2004
 Key Consideration
Were the attacks of 9-11 sufficient to change our nation's basic approach to
intelligence, set forth by President Truman in 1947, and move away from a
decentralized intelligence "community?"
• Incremental change afforded by a decentralized "community," while arguably sufficient
against the Soviet target, is fatal against networked, tech savvy, suicidal transnational
terrorism
• Intelligence Community cannot reform itself- speaking out against the current structure
puts senior managers at odds with the Secretary of Defense, who has control over the
purse strings
• President has to be personally involved with directing reform and in convincing the
public, Congress and the Cabinet that the nation's interests will be better served through
a centralized, networked intelligence capability
• Foreign allies may be concerned about their links to CIA and NSA, but might be
gratified to work with one individual in the US that has appropriate authority
Without reform intelligence cannot help stop catastrophic terrorism in the United
States

2/9/2004
 We've been admiring the problem
for along time...
Federal government Commissions/Reviews...
• Congressional Joint Inquiry (Graham-Goss, 2003)
• Counter-terrorism Intelligence Capabilities, Performance Prior to 9-11 (HPSCI)
• National Security Presidential Directive #5 (Scowcroft, 2001)
• Road Map for National Security: Imperative for Change (Hart-Rudman, 2001)
• National Reconnaissance Office Commission (Kerrey & Goss, 2000)
• Countering the Changing Threat of Int'l Terrorism (Bremer, 2000)
• Report on the Advancement of Federal Law Enforcement (Webster, 2000)
• Advisory Panel to Assess Domestic Response Capabilities for Terrorism Involving
WMD (Gilmore, 1999)
• India-Pakistan Nuclear Test Intelligence Review (Jeremiah, 1999)
• Commission to Assess the Ballistic Missile Threat to the US (Rumsfeld, 1999)
• Combating Proliferation of Weapons of Mass Destruction (1999)
• National Imagery and Mapping Agency Commission (1998)
• Commission on the Roles and Capabilities of the US 1C (Aspin-Brown, 1996)
. IC21: Intelligence Community in the 21st Century (HPSCI, 1996)
• Vice President's Task Force on Terrorism (Bush, 1985)
• A Review of the Intelligence Community (Schlesinger, 1971)

2/9/2004
 Pursued three lines of inquiry
Did US intelligence develop the sources & methods to collect
information effectively on transnational terrorism?
Did the analysts understand the nature of the threat,
communicate those insights to policymakers and effectively
warn of attack?
Were US collection and analytic resources effectively
managed to focus on transnational terrorism?

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 What did we expect to find?
An integrated collection plan with open sources, signals and
human sources focused on transnational terrorism; creative
collection methods to penetrate terrorist cells and safe havens
An analytic strategy that identifies terrorist activity indicators;
in-depth analysis that guides and strengthens collection;
strategic and tactical warning
• Someone in charge of the problem ensuring that collection and
analysis across agencies are focused and resourced to support
operations and inform policy

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Facts & Circumstances Pre 9-11:
Findings & Causes
 Collection: Vast array of sources and methods

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 Did US intelligence develop the sources & methods to collect
information effectively on transnational terrorism?

]\

9/11 Classified Information

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 Did US intelligence develop the sources & methods to collect
information effectively on transnational terrorism?

9/11 Classified Information

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 Analysis: Many veterans, new players

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 Did the analysts understand the nature of the threat,
communicate those insights to policymakers and effectively
warn of attack?

d No
National Intelligence Estimate of 1995 and the update in 1997
were on target; strategic warning was given; reporting was
performed (NID, SEIB, PDB) and direct support was provided
to the NSC Coordinating Sub-Group.

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 Did the analysts understand the nature of the threat,
communicate those insights to policymakers and effectively
warn of attack?
0 However, the NIEs lacked an in-depth understanding
Communicating threat to policymakers was uneven; most terrorism analysis was
operational/tactical; tactical warning was not provided (surprised by WTC
bombing, East Africa embassy bombings, attack on Cole, 9-11 attacks).
• No comprehensive analytic strategy
• The orientation of the analysis was overseas
• No "Red Team" effort or quality control system
• Current reporting (SitReps, DITSums, SEIBs, PDBs) pushed out in-depth
analysis
• No one was in charge of warning of attack
• Existing information wasn't shared; insufficient language skills
• Analysis didn't drive/inform collection

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 Management: Existing Structure

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 Were US collection and analytic resources effectively
managed and focused on transnational terrorism?

No
The DCI was passionate about the issue; many officers were
zealous, if not heroic, in their efforts against UBL and al-
Qa'ida; focus of CIA and White House senior management
was performing covert action legally, effectively

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 Were US collection and analytic resources effectively
managed and focused on transnational terrorism?

€* However, the Community is diffuse; collection agencies were semi-autonomous and

cooperated only when mutually beneficial; senior Community managers regarded the DCI as
merely representing CIA; performance was personality-dependent; no clear accountability for
Community's performance; DCI's power depended on his closeness to the President, not
organic authorities.
• DCI Counterterrorism Center was CIA-centric
0 "Declaration of war" on al-Qa'ida had little practical impact
0 Too much emphasis on....
• Senior Leadership failed to transcend barriers to information-sharing
0 Lack of common security rules or information technology protocols
O Proliferation of committees tended to substitute for actual decision-making
• No "community" management systems - financial, personnel, information technology
• No coherent/transparent budget process
• Community is not a learning organization
& No internal "after action" reviews post East Africa bombings, Millennium, Cole attacks

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 Post 9-11:
Tactical & Strategic Response
 Tactical Response after 9-11 was impressive...

We see clear evidence of...

• Exemplary dedication of Community personnel
• Clear priorities from the DCI on terrorism to the Community
• Increased CTC funding/personnel substantially through emergency
supplemental appropriations
• Expanded foreign liaison activities in all disciplines worldwide
• Expanded
• Supported US military in Afghanistan and Iraq (CIA, DIA, NSA,
NIMA)
• Increased reporting to non-traditional users of intelligence
• Supported major government reorganizations for DHS, USD(I), TTIC

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 DCFs strategic response remains weak, incremental

Still no clear evidence of...

• A coordinated assessment of the threat of transnational terrorism
• A comprehensive counterterrorism strategy across the Community
• A collection strategy to focus assets on transnational terrorism
• An analytic strategy to identify known unknowns to refine collection
0 A comprehensive strategy to overcome info-sharing impediments
• A foreign liaison strategy
• Constructive engagement with Legal Attache system
• A Community-wide counterterrorism budget, reliance on emergency
supplemental appropriations
• An internal "after action" review of 9-11
• Someone being put in charge of transnational terrorism across the
Community
• A solution to the warning problem

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 Administration's strategic response on intelligence has
been weak, incremental, and confusing
0 Established Department of Homeland Security "Intelligence Unit"
• Information Analysis & Infrastructure Protection off to a slow start, dependent on
detailees from other agencies for personnel
• Will be customer of finished intelligence of the Intelligence Community, including FBI
• Value added - will conduct information sharing function with state and local
governments
Q Established Terrorist Threat Integration Center (TTIC)
• Focuses on "integration" of analysis, not operations
• Will have access to raw reporting, but cumbersome info handling rules
• Dependent on agencies (CIA, NSA, FBI, etc.) for personnel, acquisition authority,
funding
• Hobbled by un-resolved information sharing/security rules
• Value added - transcends the foreign/domestic divide
O Expanded resources
. National Foreign Intelligence up by XX percent (2001 to 2004)
• Good money into a broken system will not help

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 Transnational threats are not new

9/11 Classified Information

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What accounts for these
findings?
 External Forces Undermine Effectiveness

"Post-Cold War" world - little clarity in US national security priorities

The "peace dividend," confusing budget process
Insatiable consumer demand for a "free good"
No national-level strategy on transnational terrorism
US policy regarding terrorism as a crime, not war
Leaks and security compromises
White House oversight of intelligence was limited (NSC, OMB, PFIAB)
Congressional oversight focused on budgets, not grand strategy

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 Leadership / Management Impacts Effectiveness

3 Secretary of Defense
• Secretary Cohen did not meet with the DCI on terrorism or other threats
• Secretary Rumsfeld meets regularly with the DCI on Community issues
0 The DCI
• Focused on leading CIA, made little effort to manage the Community
• Focused on operations - not Community strategy
0 Within the constraints of his authority, the DCI and his senior Community
leadership failed...
• To make hard choices regarding priorities and budgets
• To delegate sufficient authority
• To ensure that the Community gave priority to terrorism
• To remove information-sharing barriers
• To remedy chronic problems in strategic analysis
• To direct establishment of a collection-management system

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 Structure Also Inhibits Effectiveness

DCI is expected to be the President's senior advisor on intelligence, yet he

has no direct control over most collection and analysis performed by the
Community
Defense, which has direct control over most collection agencies (NSA,
NIMA, NRO), is placing increasing demands on intelligence for tactical,
real-time support to the warfighter
Dual-hatting the DCI as CIA Director has skewed the management of the
Community creating disincentives to share data, analysis, expertise
Foreign/domestic divide - originating in 1947 and reinforced by the
Commissions of the 1970s - hobbled US intelligence in countering
transnational terrorist operating within the US

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Options
 Considerations
Independence of the DCI
€ Foreign-domestic divide
9 The "Two Elephants" problem (Defense and Homeland
Security as major consumers)
O Rationalizing the intelligence functions
• Discipline (HUMINT, SIGINT, IMINT)
• "Center" approach (Goldwater-Nichols concept)
• Technical, human source, all-source analysis

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 Options

Option 1: Strengthen DCI authorities over resources (i.e., a

separate appropriation for national intelligence)
Option 2: Centralize clandestine capabilities under the CIA,
continue coordination with collection agencies on
"commodity" SIGINT and IMINT
Option 3: Centralize under a Director of National
Intelligence (DNI); enhance oversight mechanisms
Option 4: Establish DNI to manage BOTH foreign and
domestic intelligence; enhanced oversight
mechanism

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 Next Steps
Thoroughly examine implications of the Commission's
preferred centralization option (s)
• Gap-filling interviews (foreign and domestic)
• Support hearing questions for DCI, Secretary of Defense
• Develop an actionable agenda that you can provide the President
Continue to digest documents
Resources review (data requested of OMB and DCFs staff)
Oversight review (interviews scheduled)
Additional work with colleagues on Foreign/Domestic

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