NSA Stephen Hadley Press Conference on Iran NIE

Press Briefing by National Security Advisor Stephen Hadley:

MR. HADLEY: Good afternoon, I'm Steve Hadley, the President's National Security Advisor. I want to talk a little bit about the recent National Intelligence Estimate that was released to the executive branch and to the Congress today. There was an earlier briefing this afternoon by the Deputy Director of National Intelligence, Don Kerr, and also by the Director of Central Intelligence, Mike Hayden. And I wanted to give a little bit more context and set the findings of the NIE in a broader historical perspective.

The introduction is going to go on a little bit; there's a lot to tell. This is a complicated estimate. The unclassified key judgments that were released today are a little difficult to sort through and I want to try and lay this out for everybody, so I'll have an opening statement, probably 15-20 minutes, but there will be lots of time to answer questions at the end.

The Director of National Intelligence has today released the unclassified key judgments from the intelligence community's latest estimate of Iran's nuclear weapons efforts and its uranium enrichment program. The classified version of this National Intelligence Estimate was briefed to the President last Wednesday, November 28, and has been delivered to relevant congressional committees this morning.

On balance, the estimate is good news. On one hand, it confirms that we were right to be worried about Iran seeking to develop nuclear weapons. On the other hand, it tells us that we have made some progress in trying to ensure that that does not happen. But it also tells us that the risk of Iran acquiring a nuclear weapon remains a very serious problem.

The estimate offers grounds for hope that the problem can be solved diplomatically, without the use of force, as the administration has been trying to do. And it suggests we have the right strategy: intensified international pressure, along with a willingness to negotiate a solution that serves Iranian interests while ensuring the world that it will never have to face a nuclear-armed Iran. But the bottom line is that for that strategy to succeed, the international community has to turn up the pressure on Iran -- with diplomatic isolation, United Nations sanctions, and with other financial pressure. And Iran has to decide that it wants to negotiate a solution.

This is a complicated subject and the new Intelligence Estimate is a complicated document. Let me summarize the key judgments and then try and walk you through it and answer your questions. First, let me summarize the key judgments. The IC has high confidence -- high confidence -- that Iran had a covert nuclear weapons program that it has never acknowledged and continues to deny. The intelligence community has high confidence that Iran halted its covert nuclear weapons program in the fall of 2003. And they have moderate confidence that it had not restarted that program as of mid-2007.

They judge with high confidence that the halt in other nuclear-related decisions was directed primarily in response to increasing international scrutiny and pressure, resulting from exposure of Iran's previously undeclared nuclear work involving uranium enrichment. The intelligence community says they do not know whether Iran currently intends to develop nuclear weapons, but they assess with moderate to high confidence that Tehran at a minimum is keeping open the option to develop nuclear weapons. And the intelligence community assesses with moderate confidence that convincing the Iranian leadership to forgo the eventual development of nuclear weapons will be difficult.

Let me see if I can unpack this a bit and put it in context. First, remember how we got here. A little background: If a state is looking to become a nuclear-weaponed state, it needs three things. It needs weapons-grade nuclear material. It needs the technical know-how to fashion this nuclear material into a weapon. And it needs a means to deliver the weapon on a target, like a ballistic missile. The hardest step in today's world is acquiring weapons-grade nuclear material. Unless you steal it, there are two ways to get it: If you have a nuclear power reactor you can reprocess spent fuel coming out of that reactor, or you can create nuclear material by a process called uranium enrichment. This process produces fuel for nuclear power reactors, but it can also create weapons-grade nuclear material for a nuclear bomb.

In 1968, Iran signed the Nuclear Nonproliferation Treaty and pledged never to seek to acquire nuclear weapons. That's what Iran undertook to do. It signed what is called a safeguards agreement with the International Atomic Energy Agency, or the IAEA, under which it was to declare all its nuclear-related activities and open itself up to inspections by the IAEA.

In August 2002, an Iranian opposition group revealed the existence of a secret uranium enrichment plant in Iran at a place called Natans. The plant was secret. It had not been declared, as required, to the IAEA. Iran at that time had no operational nuclear power reactors, so why did it need a uranium enrichment plant? Iran was actively developing ballistic missiles. These facts raised a real concern that this was all part of an effort to develop nuclear weapons. So the IAEA, the International Atomic Energy Agency, backed by the international community, began a vigorous effort to convince Iran to suspend its enrichment activity, and thus reassure the world that it did not intend to develop nuclear weapons.

And the pressure seemed to work. In October 2003, Iran agreed to cooperate with the IAEA and suspend its uranium enrichment activities. Considerable further diplomacy involving both the IAEA and what's called the EU-3 -- representatives of Britain, France and Germany -- resulted in what's called the Paris Agreement of November 2004. In this agreement, Iran reaffirmed and extended the suspension of its enrichment activities. And the EU-3 agreed to negotiate long-term technology, economic and security arrangements for Iran.

Despite this progress, the intelligence community in May of 2005 assessed with high confidence that Iran currently was determined to develop nuclear weapons. The intelligence community maintained this assessment throughout this year, 2007. Indeed, Director of National Intelligence Negroponte told an open session of the House intelligence community on January 1, 2007, that, "our assessment is that Tehran is determined to develop nuclear weapons." DNI McConnell later told a Senate panel in open session on February 27 that, "We assess that Tehran seeks to develop nuclear weapons."

The irony is that one month after the intelligence community released this assessment, in June of 2005, Ahmadinejad wins a runoff election and becomes Iran's President. On August 1, 2005, just two months after taking power, Ahmadinejad informs the IAEA that he has decided to resume uranium enrichment, and does so beginning in January 2006.

For the next two years, through a whole series of IAEA Board of Governors resolutions urging Iranian compliance, through two U.N. Security Council sanctions resolutions, sweetened by negotiating offers by the EU-3 and the promise that the United States would join those negotiations, the international community tried unsuccessfully to get Iran to suspend its uranium enrichment activities, and those efforts to get the suspension continue today.

Also during this period, the President directs the intelligence community to enhance its capabilities to gather intelligence on Iran's nuclear programs.

Earlier this year, Congress called for a new National Intelligence Estimate on Iran. It is in part delayed in order to process -- the finalization of that NIE is delayed in part in order to process new intelligence, some of which has been received in the last few months.

The National Intelligence Estimate released today reveals that there was a covert nuclear weapons program. It also reveals that, unknown to us, that program was halted in the fall of 2003. So the covert nuclear weapons program was unknown to us, suspected, unknown; now confirmed. But what was also unknown was that the program was halted in the fall of 2003. That secret -- that covert nuclear weapons program was halted at the same time the Iranians publicly announced that they were suspending their public and declared uranium enrichment program.

So where does that leave us? One, we have good reason to continue to be concerned about Iran developing a nuclear weapon, even after this most recent National Intelligence Estimate. In the words of the NIE, "Iranian entities are continuing to develop a range of technical capabilities that could be applied to producing nuclear weapons if a decision is made to do so." For example, Iran's civilian uranium enrichment program is continuing. And as you know, once a country masters the technology to enrich uranium for use even in a civilian nuclear power program, it could readily use the same technology to produce weapons-grade uranium. As we have said, weapons-grade uranium is the long pole in the tent for a nuclear weapon.

And Iran continues to develop, test and deploy ballistic missiles -- a very attractive delivery system for a nuclear weapon. For example, the Iranian Defense Minister publicly acknowledged a medium-range ballistic missile called the Ashura, which could reach much of Eastern Europe.

Finally, we are very unsure of Iran's attentions [sic], even with respect to the covert nuclear weapons program that Iran has halted. Again, let me quote the National Intelligence Estimate: "We do not have sufficient intelligence to judge confidentially whether Tehran is willing to maintain the halt of its nuclear weapons program indefinitely while it weighs its options, or whether it will or already has set specific deadlines or criteria that will prompt it to restart the program."

Again from the NIE: "We assess with moderate confidence that convincing the Iranian leadership to forgo the eventual deployment of nuclear weapons will be difficult given the linkage many within the leadership probably see between nuclear weapons development and Iran's key national security and foreign policy objectives."

But the NIE gives us reason to believe that our current strategy stands the best chance of convincing Iran to give up its nuclear ambitions. Again, let me quote for a final time from the NIE: "Our assessment that Iran halted the program in 2003, primarily in response to international pressure, indicates Tehran's decisions are guided by a cost-benefit approach, rather than a rush to a weapon irrespective of political, economic and military costs. This in turn suggests that some combination of threats of intensified international scrutiny and pressures, along with opportunities for Iran to achieve its security, prestige and goals for regional influence in other ways might, if perceived by Iran's leaders as credible, prompt Tehran to extend the current halt to its nuclear weapons program. It is difficult to specify just what such a combination might be."

We have been pursuing this very strategy for over two years, since Iran resumed its nuclear enrichment. If we are to avoid the grim choice between accepting an Iran on the path to nuclear weapons or considering the use of force, we need to intensify our pressure on Iran, while making clear that if they do suspend enrichment, there is an opportunity for better relations with the international community.

And with that, I'll stop and I'd be pleased to answer your questions.

Q It is troubling that the United States was so wrong about what Iran was doing or what its intentions were?

MR. HADLEY: I don't think we were wrong about what it's doing or what its intentions were. Our concern was that they were pursuing a nuclear weapon. We saw the enrichment, which we couldn't really explain; we saw the ballistic missiles. And it led people to conclude: We are concerned that they were pursuing a nuclear weapons program and might have a covert program to actually weaponize highly-enriched uranium in order to be a nuclear weapon. And that's what the NIE has now discovered.

The President said some months ago, probably over a year ago, we need to have better intelligence on Iran's nuclear program; we have these suspicions, we have this concern, we need better intelligence to get greater certainty. The intelligence community increased their efforts, and lo and behold, in the last few months we get credible evidence that gives them a high confidence that they had a covert nuclear weapons program to weaponize weapons grade highly-enriched uranium into a weapon.

Q But in 2005 you thought that they had a nuclear weapons program, whereas you now think they abandoned it, or put it aside in 2003.

MR. HADLEY: We thought they had that program, we did indeed, in 2005.

Q So that's what I meant when I said, wrong.

MR. HADLEY: We have looked at it and we have determined that, indeed, they did have a program, and a covert program, which we had not been able to detect, but we also determined that they had suspended it in -- or halted it -- which is the term of art -- in fall of 2003 in response to international pressure. That's exactly right.

Q But, Steve, the question is, how did the government get it wrong? And isn't that troubling that it got so wrong over that two-year span?

MR. HADLEY: I don't think it is so wrong. I think it is right. If they had been saying in 2005 not to worry, Iran has no nuclear weapons ambitions, then we would have clearly got it wrong, because they did have such a program. I would say to you, they got it right, in terms of being concerned about Iran seeking a nuclear weapon. And we continue to be concerned about a nuclear weapon.

Remember, Iran is one of a handful of the hardest intelligence targets going. They are very good at this business of keeping secrets. And there's probably no secret that will be more closely kept by Iran than what it's doing on nuclear weapons. So I think the fact that we have got this additional information is an indication that we are succeeding in learning more about this program. And I think you have to recognize we're going to continue to dig, continue to learn more, and that's a good thing. That's --

Q Steve, let me follow on this point. If we now estimate with high confidence that it was shut down as of 2003, that it was halted, in October of this year, in 2007, the President is speaking about the Iranian threat, in terms of World War III. Why wouldn't you conclude that this President is hyping the threat?

MR. HADLEY: Because he was describing the threat as the intelligence community itself had been describing the threat both publicly and in their briefings to him. The President, as I think if you look at the testimony that was given by Don Kerr and Mike Hayden today, they basically said that the intelligence community finally came to the judgments that they came to on this issue Tuesday of last week. The President was briefed on Wednesday. So this is challenging information. The intelligence community had to decide what they thought about it. They were sufficiently uncertain about it that they delayed the publication of the NIE until they could come to the bottom of it, reach their conclusions, present it to the President, as they did on Wednesday, and then at that point, obviously, we wanted to get it out quickly.

Q They describe the Iranian threat today differently than the President would have even a month ago.

MR. HADLEY: Because our intelligence community has told us effective today that their assessment is somewhat different than it was before. That's correct.

Q How does this -- how does this not undercut the effort to get an international coalition? The urgency of doing that -- I would think all the international partners would say, wait a minute, they haven't had a program since 2003, so let's back off a little with the urgency.

MR. HADLEY: I think there is going to be a tendency or a lot of people to say, the problem is less bad than we thought, let's relax. And I think our view is that would be a mistake. Why? Because, as we said, in today's world the critical problem for making a nuclear weapon is getting the weapons-grade nuclear material. And for Iran, they are trying to get the capability to do that. Let me put it this way, their path to getting that capability is the enrichment program.

This is the program that they agreed to shut down in 2003, 2004, but restarted in 2005. It has been championed by Ahmadinejad. He is now making public announcements that they have 3,000 centrifuges and have mastered that technology. You don't need to take those assertions to the bank to be concerned that Iran is getting to the point where it will have mastered the ability to enrich uranium. And having mastered that ability to enrich uranium, they have the -- they will have the capacity to make weapons-grade nuclear uranium. That is the long pole in the tent, and that's what the international community has been trying, in a pretty united way, for the last three or four years to get the Iranians to suspend.

Q What do you know about the program that you say now you have confirmed the Iranians were conducting, that they suspended in 2003? What do you know about that program now? How long had that program been in place? How effective, how far along before they halted?

MR. HADLEY: Those are good questions. They are questions that I think Don Kerr and Mike Hayden should address. Some of this gets into portions of these materials that are still classified. Let me read you, though, I think as a starting point, a footnote that appears in the declassified key judgments that were put out today.

When you talk about a nuclear weapons program, what the intelligence community says they mean is Iran's nuclear weapon design -- that is to say, an effort to design a nuclear weapon. And weaponization work -- that is to say, taking weapons-grade uranium and adapting it so that it can be an operational nuclear weapon. And covert uranium conversion-related and uranium enrichment-related work. And that suggests that part of the program was a covert uranium enrichment facility.

And why would we worry about that? Because we would worry about it that in -- paired with an overt, declared uranium enrichment program, the information and know-how gleaned by that -- from that public uranium enrichment program could be passed at some time -- in the past or in the future -- to a covert uranium enrichment program, which could be used to develop and produce nuclear weapons grade material for a nuclear weapon.

Q There had to be more than an inkling before today that this information, this intelligence, that the Iranians had an ongoing nuclear weapons program was incorrect. So why wasn't -- why then would the President allow it or advise to go ahead with ratcheting up the rhetoric, instead of toning it down, when right now this obviously raises issues of credibility with the American public and with American allies about U.S. intelligence?

MR. HADLEY: Two things. One, when the President was told that we had some additional information, he was basically told: stand down; needs to be evaluated; we'll come to you and tell you what we think it means. So this was basically -- as we said, this is information that came in the last few months, and the intelligence community spent a lot time to get on top of it.

Secondly, I would disagree with you that the President has ratcheted up the rhetoric. We have said -- he has said, I have said, other administration officials have said many times, look, we want diplomacy to work. Because, as I said in my statement, we don't want to be in a situation where the only two choices this or a future President has is to accept Iran on a path to a nuclear weapon or to have to contemplate the use of nuclear force -- sorry, use of military force. Because that in the context of today's Middle East is a big move.

And so the President, in that statement -- as he said before and as he explained afterwards -- was trying to give a wake-up call to the international community that we needed to step up the diplomacy and step up the pressure to get Iran to suspend its declared uranium enrichment program. And that still is the case today, because that is the path to weapons-grade material which would give Iran the option in the future to produce a nuclear weapon.

Q The President -- you said the President was told to stand down on that --

MR. HADLEY: No, I said just the opposite. I said the President was told, we have some information, we have some new information not to stand down -- said, we have some new information; give us some time to analyze it, and we will come to you and tell you what we think it means.

Q Was he told that before or after --

MR. HADLEY: And that's what he was told, and they -- as was briefed by the intelligence community today, they came to their final judgments on Tuesday of last week, and they told the President of the United States on Wednesday.

Q But was he given that advice before or after the World War III comment?

MR. HADLEY: I'll have to -- I'll have to look.

Q Which was on October 20th.

MR. HADLEY: From my mind, it doesn't make any difference, because the World War III comment you characterize as stepping up the rhetoric. I would say it was making a point that the President and we have been making for two or three years, that the international community has to exert more pressure because Iran needs to suspend its enrichment program.

That was the position of our policy before the National Intelligence Estimate, and for the reasons I said. That continues to be our policy after this latest National Intelligence Estimate.

Q Steve, just to clarify.

MR. HADLEY: Sure.

Q Is it fair to say that the intelligence came in, in recent weeks, not recent months? Because this -- as was pointed out, the press briefing was late October when the President was asked definitively, do you believe Iran wants to build a nuclear bomb? And that's where you get, in the second part of that answer, the World War III comment.

MR. HADLEY: Correct.

Q So was it recent weeks that this intelligence came in?

MR. HADLEY: What the intelligence community has said is in the last few months. And again I would say, if they were working on this information before that quote in October, again, in terms of the point the President was making, he would have made that comment before we got -- the intelligence community got this information. He would have made that, I believe, that comment after. I just made it in this statement, which is, the international community has to understand that if we want to avoid a situation where we either have to accept Iran on the road to a nuclear weapon, with a path to a nuclear weapon, or the possibility of having to use force to stop it, with all the connotations of World War III, then we need to step up the diplomacy, step up the pressure to get Iran to stop their civilian -- so-called civilian uranium enrichment program. That was our policy before his October comment, that was the policy between October -- his October comment and today, and that's our policy going forward; no change.

Q Steve, you just said you would describe it quite different. Just a minute ago --

MR. HADLEY: I think that's right. And we would describe it --

Q Are you being consistent? I don't think you're being consistent.

MR. HADLEY: I am being consistent, because what we can say now is, that they actually had -- which we did not know at the time of 2005 -- they actually had a covert weapons program, which means we were right to be concerned; it was probably worse than we thought.

We would also say now, but that program, that covert nuclear weapon program has been suspended. And therefore it is important for our policy to continue to put diplomatic pressure on Iran so that the suspension -- the halting, excuse me -- the halting of their covert nuclear weapons program continues and that they suspend their uranium enrichment program. Because if you can do both of those things, maintain the halting of the nuclear weapons program and obtain the suspension of the uranium enrichment program, you've got some real assurance that Iran is not going to be on the path towards a nuclear weapon -- assuming they don't steal the weapon, they don't get weapons-grade nuclear material from some other source. And it still leaves the worrisome fact that they're working and developing ballistic missiles.

But it is a -- so I would describe our posture differently. I would describe our assessment -- the intelligence community would describe the assessment in a different way. But in terms of our policy, it continues to be one. And I would say it both underscores the urgency of the policy, and also gives us some confidence that it actually can work, but only if we pick up the pace.

Yes, ma'am.

Q Given the halting, as you described it, does this strengthen the position of Russia and China on sanctions, specifically?

MR. HADLEY: Well, we hope not, because as I said, the problem presented by the continuing uranium enrichment program continues, because that is the long pole for a country like Iran on the way towards having a path towards a nuclear weapon. That's something that Russia has said clearly they don't want Iran to do; that's something we think, less clearly, China has said the same thing.

So again, as the President says many times, we're asking people to do hard things. We're asking people to put pressure on Iran, and it has consequences for their diplomacy, it has consequences for their companies doing business with Iran. People don't like to do that. So I'm sure some people will try and use this as an excuse or a pretext for flagging on the effort.

Our argument is, actually, it should be just the reverse, because we need to keep the halting of the nuclear weapons program in place; we need to achieve the suspension of the enrichment program; and the only way -- what this NIE says is that the best path to do that is to continue what we've been doing, which is diplomatic isolation, U.N. sanctions and other financial pressure, plus the option for negotiations.

Q Second question. When did the Vice President get briefed on this? Because he was warning of serious consequences just last month, too.

MR. HADLEY: I've just got a note from him -- I did it once, I'll do it again. In terms of stand down, they did not tell the President to stand down and stop talking about Iran's nuclear program; they told him just the opposite: Mr. President, we have new information. Or let me put it this way, not just the opposite, let me be precise. He was not told to stop talking about Iran's nuclear weapons program. He was not told to change what he says about it. What he was told was, we have new information; it is interesting; it is going to take us some time to understand it, to assess it, to know what it means, and to know how credible it is, and we will come back to you when that process is done. And they did. And they came back to him Wednesday, and the results of their work is included in this estimate. Is that okay? (Laughter.)

I'm sorry, you asked a question and I didn't answer. Could you restate it, please?

Q When was the Vice President briefed on this? You mentioned when the President was, what about the Vice President?

MR. HADLEY: He, of course, can answer that for himself. I will say that the week before the Tuesday/Wednesday, there was a meeting that was held with the principals -- including the Vice President, myself and others -- to get a preliminary look at this information, to get some sense of it, and to give us an opportunity to test it and ask questions about it, and probe it a little bit, as part -- and we thought, one, so we would understand it, and two, as part of the process for the intelligence community, you know, coming to its conclusion about what this all meant. And those were the conclusions that they reached on Tuesday, and which were briefed to the President on Wednesday of last week.

Peter.

Q Steve, when was the first time the President was given the inkling of something? I'm not clear on this. Was this months ago, when the first information started to become available to intelligence agencies?

MR. HADLEY: You ought to go back to the intelligence community. We will get you an answer on that. There's two questions: one, when did they first get the information? -- you ought to ask that to them -- two, when was the President notified that there was new information available? We'll try and get you a precise answer. As I say, it was, in my recollection, is in the last few months. Whether that is October -- August, September, we'll try and get you an answer to that.

Q What about the -- I mean, in your view, for a lot of people will sound like echoes of Iraq, what we thought they -- we talked about what programs we thought they had -- in fact they suspended it or stopped it and so forth. I mean, how does this affect the credibility of everything you want to say about this or any other threat that might be out there in the world today?

MR. HADLEY: Well, I think all we can do is try and -- and I think all the intelligence community can do -- is try and get the best information they can, to try and be straight with the Congress and the President about how they assess that information, with what level of confidence, and to continue to get additional information. And when they get that additional information, if it changes their assessment, to come out and so inform people. You know, these are not puzzles that once you solve them, you have solved them for all times. These are challenges that are ongoing against very hard targets that lie, that try and prevent things from becoming public, and that try and mislead. And it is a very difficult intelligence channel.

So I think the answer is, in some sense, you know, welcome to the real world. And so the challenge for the intelligence community is to say, in all of this work -- and it's very challenging -- what they know, what they assess, what's the confidence of their assessment, and what they don't know. And that's what the intelligence community tries to do, and I think in some sense the unclassified key judgments -- if you read them with care -- show very clearly that that's what they're trying to do. And I will tell you, I'm sure we are going to -- I hope we are going to learn more, and that's probably going to change what we know and probably change our assessments, probably change our confidence level, because this is going to be something that this administration and future administrations are working with for a long time.

Q Just to turn your premise around a little bit, you said that you should keep the pressure up on the international -- with the international community. But doesn't the fact that Iran halted its program, even if it was covert, suggest that perhaps there is room for a negotiated settlement that would keep nuclear weapons out of the government --

MR. HADLEY: Yes, I said two things. I said we need to keep the pressure up, but also make clear there is a path for negotiation that will assess Iranian concerns. Our job is to keep up the pressure, but also to offer this negotiating path. But in the end of the day, the Iranians have to signal that they're willing to accept a negotiation path. And as you know, there have been now almost three years of off-and-on meetings -- two years probably -- off-and-on meetings between an Iranian negotiator -- for the longest time that was Larijani -- and with the EU-3, in terms of Javier Solana; that various offers have been put down for the EU-3 about how to address Iran's security, economic and diplomatic concerns; a path where Iran could reliably know that it could have a purely civil nuclear power program. There have been several offers of that sort.

So the combination that the intelligence community says is most likely to work is pressure, plus a negotiating option. That continues to be the case to this day. But at some point, Iran has to indicate a willingness to sit down and negotiate. And that's what we have not yet seen.

Thank you very much.

Former QwestCom CEO Says, "Bush Approached Us BEFORE 9/11/01 To Illegally Wiretap"

Former CEO Says U.S. Punished Phone Firm - Qwest Feared NSA Plan Was Illegal, Filing Says

The Washington Post reports:

A former Qwest Communications International executive, appealing a conviction for insider trading, has alleged that the government withdrew opportunities for contracts worth hundreds of millions of dollars after Qwest refused to participate in an unidentified National Security Agency program that the company thought might be illegal.

Former chief executive Joseph P. Nacchio, convicted in April of 19 counts of insider trading, said the NSA approached Qwest more than six months before the Sept. 11, 2001, attacks, according to court documents unsealed in Denver this week.

Details about the alleged NSA program have been redacted from the documents, but Nacchio's lawyer said last year that the NSA had approached the company about participating in a warrantless surveillance program to gather information about Americans' phone records.

In the court filings disclosed this week, Nacchio suggests that Qwest's refusal to take part in that program led the government to cancel a separate, lucrative contract with the NSA in retribution. He is using the allegation to try to show why his stock sale should not have been considered improper.

Nacchio was convicted for selling shares of Qwest stock in early 2001, just before financial problems caused the company's share price to tumble. He has claimed in court papers that he had been optimistic that Qwest would overcome weak sales because of the expected top-secret contract with the government. Nacchio said he was forbidden to mention the specifics during the trial because of secrecy restrictions, but the judge ruled that the issue was irrelevant to the charges against him.

Nacchio's account, which places the NSA proposal at a meeting on Feb. 27, 2001, suggests that the Bush administration was seeking to enlist telecommunications firms in programs without court oversight before the terrorist attacks on New York and the Pentagon. The Sept. 11 attacks have been cited by the government as the main impetus for its warrantless surveillance efforts.

The allegations could affect the debate on Capitol Hill over whether telecoms sued for disclosing customers' phone records and other data to the government after the Sept. 11 attacks should be given legal immunity, even if they did not have court authorization to do so.

Spokesmen for the Justice Department, the NSA, the White House and the director of national intelligence declined to comment, citing the ongoing legal case against Nacchio and the classified nature of the NSA's activities. Federal filings in the appeal have not yet been disclosed.

In May 2006, USA Today reported that the NSA had been secretly collecting the phone-call records of tens of millions of Americans, using data provided by major telecom firms. Qwest, it reported, declined to participate because of fears that the program lacked legal standing.

In a statement released after the story was published, Nacchio attorney Herbert Stern said that in fall 2001, Qwest was approached to give the government access to the private phone records of Qwest customers. At the time, Nacchio was chairman of the president's National Security Telecommunications Advisory Committee.

"Mr. Nacchio made inquiry as to whether a warrant or other legal process had been secured in support of that request," Stern said. "When he learned that no such authority had been granted and that there was a disinclination on the part of the authorities to use any legal process, including the Special Court which had been established to handle such matters, Mr. Nacchio concluded that these requests violated the privacy requirements of the Telecommunications Act."

Stern could not be reached for comment yesterday. Another lawyer for Nacchio, Jeffrey Speiser, declined to comment on whether the call-records program was the program discussed at the February 2001 meeting.

In a May 25, 2007, order, U.S. District Judge Edward W. Nottingham wrote that Nacchio has asserted that "Qwest entered into two classified contracts valued at hundreds of millions of dollars, without a competitive bidding process and that in 2000 and 2001, he participated in discussion with high-ranking [redacted] representatives concerning the possibility of awarding additional contracts of a similar nature." He wrote, "Those discussions led him to believe that [redacted] would award Qwest contracts valued at amounts that would more than offset the negative warnings he was receiving about Qwest's financial prospects."

The newly released court documents say that, on Feb. 27, 2001, Nacchio and James Payne, then Qwest's senior vice president of government systems, met with NSA officials at Fort Meade, expecting to discuss "Groundbreaker," a project to outsource the NSA's non-mission-critical systems.

The men came out of the meeting "with optimism about the prospect for 2001 revenue from NSA," according to an April 9, 2007, court filing by Nacchio's lawyers that was disclosed this week.

But the filing also claims that Nacchio "refused" to participate in some unidentified program or activity because it was possibly illegal and that the NSA later "expressed disappointment" about Qwest's decision.

"Nacchio said it was a legal issue and that they could not do something that their general counsel told them not to do. . . . Nacchio projected that he might do it if they could find a way to do it legally," the filing said.

Mike German, policy counsel for the American Civil Liberties Union, said the documents show "that there is more to this story about the government's relationship with the telecoms than what the administration has admitted to."

Kurt Opsahl, senior staff attorney for the Electronic Frontier Foundation, said: "It's inappropriate for the government to be awarding a contract conditioned upon an agreement to an illegal program. That truly is what's going on here."

The foundation has sued AT&T, charging that it violated privacy laws by cooperating with the government's warrantless surveillance program.

Spies Prep Reporters on Protecting Secrets

The New York Sun reports:

Frustrated by press leaks about its most sensitive electronic surveillance work, the secretive National Security Agency convened an unprecedented series of off-the-record "seminars" in recent years to teach reporters about the damage caused by such leaks and to discourage reporting that could interfere with the agency's mission to spy on America's enemies.

The half-day classes featured high-ranking NSA officials highlighting objectionable passages in published stories and offering "an innocuous rewrite" that officials said maintained the "overall thrust" of the articles but omitted details that could disclose the agency's techniques, according to course outlines obtained by The New York Sun.

Dubbed "SIGINT 101," using the NSA's shorthand for signals intelligence, the seminar was presented "a handful of times" between approximately 2002 and 2004, an agency spokeswoman, Marci Green, confirmed yesterday. Officials were pleased with the program, she said.

"They believe they were very successful in being able to talk to journalists regarding our mission and the sensitivities of our mission in an unclassified way," Ms. Green said.

The syllabi make clear that the sessions, which took place at NSA headquarters in Fort Meade, Md., were conceived of not merely as familiarization tours, but as part of a campaign to limit the damage caused by leaks of sensitive intelligence.

"Course Objective: to convey the fragility of SIGINT and to increase editors' and reporters' understanding that there are other ways to express similar thoughts in an article without compromising the story and without compromising SIGINT," the syllabi said.

The NSA's seminars, delivered over tea and pastries, and accompanied by a clip from "Top Gun," seemed designed to elicit a chummy atmosphere and to highlight commonalities between reporters and the agency's electronic sleuths. "Reporters go to great lengths to protect their sources, as do we," one talking point for the classes said. "We need your help."

Journalists were also treated to technical demonstrations and encouraged to feel that they had gotten a rare behind-the-scenes view of the agency. "Stress that this is the first-ever such course in NSA's history," another talking point said. During one sensitive discussion, journalists were to be told they could not take any notes.

Among the news stories singled out for redrafting by the NSA were an Associated Press rewrite of a 1999 USA Today article by Jack Kelley reporting that officials used a "reconnaissance satellite" to intercept Osama bin Laden's telephone calls and head off six attacks on American embassies, a 1998 Knight Ridder dispatch by Neely Tucker reporting that an "exhaustive review of electronic intercepts of the traffic on bin Laden's communications network" picked up evidence of his involvement in the bombing of American embassies in Kenya and Tanzania, and a 1998 New York Times story by Steven Lee Myers reporting that a Pentagon warning about a possible attack on American interests in the Persian Gulf was prompted by "eavesdropping on conversations between Mr. bin Laden" and his cohorts.

The exact substitutions of language that the NSA proposed were deleted from the syllabi released to the Sun under the Freedom of Information Act. The agency did leave in the caveat that it was "neither confirming nor denying the accuracy" of the reports it used as examples.

Mr. Tucker, the author of the Knight Ridder story, said in an interview yesterday that he was never invited to the course and never knew the NSA had a problem with the report. "Nobody ever said a word," he said. Mr. Tucker, who now writes for the Washington Post, noted that he was in Africa at the time and that the passage probably originated with another reporter in Washington.

Told of his involvement in the NSA seminar, he said, "Always glad to help NSA any way I can."

Mr. Myers did not respond to a phone message yesterday seeking comment. Mr. Kelley, who quit USA Today in 2004 amid a probe into fabricated stories, could not be reached.

Ms. Green said the program stopped in late 2004 due to staffing changes at the NSA's public affairs operation.

In 2005, following the publication of a New York Times story on a secret program for warrantless wiretapping of some phone calls placed or received in America, the Bush administration's attitude toward leaks became far more confrontational. Director of Central Intelligence Porter Goss crusaded against leaks at the CIA and later told a Senate committee that he hoped reporters would be called before grand juries to identify their sources. Attorney General Gonzales also discussed the "possibility" of prosecuting journalists who wrote stories based on leaked intelligence.

The syllabi, which are marked as drafts, list presenters including the director of the NSA at the time, General Michael Hayden, the agency's general counsel, Robert Deitz, and the head of the signals intelligence division, Maureen Baginski.

Ms. Baginski, who left NSA in 2003 and is now in the private sector, said yesterday that she had no recollection of making such a presentation. Told of the rewriting element of the class, she chuckled and said, "It's an interesting approach."

The Sun obtained the syllabi in response to a Freedom of Information Act request regarding an investigation into leaks about NSA intercepts that may have presaged the terrorist attacks of September 11, 2001. The released course materials contain no obvious reference to those leaks, but they may have been mentioned in portions of the syllabus the NSA deleted from the released copy.

Transcript: Interview with Mike McConnell on the Foreign Intelligence Surveillance Act

From the El Paso Times, the following is the transcript of a question and answer session with National Intelligence Director Mike McConnell:

Question: How much has President Bush or members of his administration formed your response to the FISA debate?

Answer: Not at all. When I came back in, remember my previous assignment was director of the NSA, so this was an area I have known a little bit about. So I came back in. I was nominated the first week of January. The administration had made a decision to put the terrorist surveillance program into the FISA court. I think that happened the 7th of Jan. So as I come in the door and I'm prepping for the hearings, this sort of all happened. So the first thing I want to know is what's this program and what's the background and I was pretty surprised at what I learned. First off, the issue was the technology had changed and we had worked ourselves into a position that we were focusing on foreign terrorist communications, and this was a terrorist foreigner in a foreign country. The issue was international communications are on a wire so all of a sudden we were in a position because of the wording in the law that we had to have a warrant to do that. So the most important thing to capture is that it's a foreigner in a foreign country, required to get a warrant. Now if it were wireless, we would not be required to get a warrant. Plus we were limited in what we were doing to terrorism only and the last time I checked we had a mission called foreign
intelligence, which should be construed to mean anything of a foreign intelligence interest, North Korea, China, Russia, Syria, weapons of mass destruction proliferation, military development and it goes on and on and on. So when I engaged with the administration, I said we've gotten ourselves into a position here where we need to clarify, so the FISA issue had been debated and legislation had been passed in the house in 2006, did not pass the Senate. Two bills were introduced in the Senate, I don't know if it was co-sponsorship or two different bills, but Sen. (Dianne Feinstein, D-Calif.) had a bill and Sen. Specter had a bill and it may have been the same bill, I don't know, but the point is a lot of debate, a lot of dialogue. So, it was submitted to the FISA court and the first ruling in the FISA court was what we needed to do we could do with an approval process that was at a summary level and that was OK, we stayed in business and we're doing our mission. Well in the FISA process, you may or may not be aware ...

Q: When you say summary level, do you mean the FISA court?

A: The FISA court. The FISA court ruled presented the program to them and they said the program is what you say it is and it's appropriate and it's legitimate, it's not an issue and was had approval. But the FISA process has a renewal. It comes up every so many days and there are 11 FISA judges. So the second judge looked at the same data and said well wait a minute I interpret the law, which is the FISA law, differently. And it came down to, if it's on a wire and it's foreign in a foreign country, you have to have a warrant and so we found ourselves in a position of actually losing ground because it was the first review was less capability, we got a stay and that took us to the 31st of May. After the 31st of May we were in extremis because now we have significantly less capability. And meantime, the community, before I came back, had been working on a National Intelligence Estimate on terrorist threat to the homeland. And the key elements of the terrorist threat to the homeland, there were four key elements, a resilient determined adversary with senior leadership willing to die for the cause, requiring a place to train and develop, think of it as safe haven, they had discovered that in the border area between Pakistan and Afghanistan. Now the Pakistani government is pushing and pressing and attempting to do something about it, but by and large they have areas of safe haven. So leadership that can adapt, safe haven, intermediate leadership, these are think of them as trainers, facilitators, operational control guys. And the fourth part is recruits. They have them, they've taken them. This area is referred to as the FATA, federally administered tribal areas, they have the recruits and now the objective is to get them into the United States for mass casualties to conduct terrorist operations to achieve mass casualties. All of those four parts have been carried out except the fourth. They have em, but they haven't been successful. One of the major tools for us to keep them out is the FISA program, a significant tool and we're going the wrong direction. So, for me it was extremis to start talking not only to the administration, but to members of the hill. So from June until the bill was passed, I think I talked to probably 260 members, senators and congressmen. We submitted the bill in April, had an open hearing 1 May, we had a closed hearing in May, I don't remember the exact date. Chairman (U.S. Rep. Silvestre Reyes, D-Texas) had two hearings and I had a chance to brief the judiciary committee in the house, the intelligence committee in the house and I just mentioned the Senate, did not brief the full judiciary committee in the Senate, but I did meet with Sen. (Patrick Leahy, D-Vt.) and Sen. (Arlen Specter, R-Pa.), and I did have an opportunity on the Senate side, they have a tradition there of every quarter they invite the director of national intelligence in to talk to them update them on topics of interest. And that happened in (June 27). Well what they wanted to hear about was Iraq and Afghanistan and for whatever reason, I'm giving them my review and they ask questions in the order in which they arrive in the room. The second question was on FISA, so it gave me an opportunity to, here I am worrying about this problem and I have 41 senators and I said several things. The current threat is increasing, I'm worried about it. Our capability is decreasing and let me explain the problem.

Q: Can't you get the warrant after the fact?

A: The issue is volume and time. Think about foreign intelligence. What it presented me with an opportunity is to make the case for something current, but what I was really also trying to put a strong emphasis on is the need to do foreign intelligence in any context. My argument was that the intelligence community should not be restricted when we are conducting foreign surveillance against a foreigner in a foreign country, just by dint of the fact that it happened to touch a wire. We haven't done that in wireless for years.

Q: So you end up with people tied up doing paperwork?

A: It takes about 200 man hours to do one telephone number. Think about it from the judges standpoint. Well, is this foreign intelligence? Well how do you know it's foreign intelligence? Well what does Abdul calling Mohammed mean, and how do I interpret that? So, it's a very complex process, so now, I've got people speaking Urdu and Farsi and, you know, whatever, Arabic, pull them off the line have them go through this process to justify what it is they know and why and so on. And now you've got to write it all up and it goes through the signature process, take it through (the Justice Department), and take it down to the FISA court. So all that process is about 200 man hours for one number. We're going backwards, we couldn't keep up. So the issue was ...

Q: How many calls? Thousands?

A: Don't want to go there. Just think, lots. Too many. Now the second part of the issue was under the president's program, the terrorist surveillance program, the private sector had assisted us. Because if you're going to get access you've got to have a partner and they were being sued. Now if you play out the suits at the value they're claimed, it would bankrupt these companies. So my position was we have to provide liability protection to these private sector entities. So that was part of the request. So we went through that and we argued it. Some wanted to limit us to terrorism. My argument was, wait a minute, why would I want to limit it to terrorism. It may be that terrorists are achieving weapons of mass destruction, the only way I would know that is if I'm doing foreign intelligence by who might be providing a weapon of mass destruction.

Q: And this is still all foreign to foreign communication?

A: All foreign to foreign. So, in the final analysis, I was after three points, no warrant for a foreigner overseas, a foreign intelligence target located overseas, liability protection for the private sector and the third point was we must be required to have a warrant for surveillance against a U.S. person. And when I say U.S. person I want to make sure you capture what that means. That does not mean citizen. That means a foreigner, who is here, we still have to have a warrant because he's here. My view is that that's the right check and balances and it's the right protection for the country and lets us still do our mission for protection of the country. And we're trying to fend off foreign threats.

Q: So are you satisfied with it the way it is now?

A: I am. The issue that we did not address, which has to be addressed is the liability protection for the private sector now is proscriptive, meaning going forward. We've got a retroactive problem. When I went through and briefed the various senators and congressmen, the issue was alright, look, we don't want to work that right now, it's too hard because we want to find out about some issues of the past. So what I recommended to the administration is, 'Let's take that off the table for now and take it up when Congress reconvenes in September.'

Q: With an eye toward the six-month review?

A: No, the retroactive liability protection has got to be addressed.

Q: And that's not in the current law?

A: It is not. Now people have said that I negotiated in bad faith, or I did not keep my word or whatever...

Q: That you had an agenda that you weren't honest about.

A: I'll give you the facts from my point of view. When I checked on board I had my discussion with the president. I'm an apolitical figure. I'm not a Republican, I'm not a Democrat. I have voted for both. My job is as a professional to try to do this job the best way I can in terms of, from the intelligence community, protect the nation. So I made my argument that we should have the ability to do surveillance the same way we've done it for the past 50 years and not be inhibited when it's a foreigner in a foreign country. The president's guidance to me early in the process, was, 'You've got the experience. I trust your judgement. You make the right call. There's no pressure from anybody here to tell you how to do it. He did that early. He revisited with me in June. He did it again in July and he said it publicly on Friday before the bill was passed. We were at the FBI, it's an annual thing, we go to the FBI and do a homeland security kind of update. So he came out at noon and said, 'I'm requesting that Congress pass this bill. It's essential. Do it before you go on recess. I'm depending on Mike McConnell's recommendations. And that was the total sum and substance of the guidance and the involvement from the White House with regard to how I should make the call. Now, as we negotiated, we started with 66 pages, were trying to get everything cleaned up at once. When I reduced it to my three points, we went from 66 pages to 11. Now, this is a very, very complex bill. I had a team of 20 lawyers working. You can change a word in a paragraph and end up with some major catastrophe down in paragraph 27, subsection 2c, to shut yourself down, you'll be out of business. So when we send up our 11 pages, we had a lot of help in making sure we got it just right so it would come back and we'd say wait a minute we can't live with this or one of the lawyers would say, 'Wait we tried that, it won't work, here's the problem.' So we kept going back and forth, so we sent up a version like Monday, we sent up a version on Wednesday, we sent up a version on Thursday. The House leadership, or the Democratic leadership on Thursday took that bill and we talked about it. And my response was there are some things I can't live with in this bill and they said alright we're going to fix them. Now, here's the issue. I never then had a chance to read it for the fix because, again, it's so complex, if you change a word or phrase, or even a paragraph reference, you can cause unintended ...
Q: You have to make sure it's all consistent?
A: Right. So I can't agree to it until it's in writing and my 20 lawyers, who have been doing this for two years, can work through it. So in the final analysis, I was put in the position of making a call on something I hadn't read. So when it came down to crunch time, we got a copy and it had some of the offending language back in it. So I said, 'I can't support it.' And it played out in the House the way it played out in the House. Meantime on the Senate side, there were two versions being looked at. The Wednesday version and the Thursday version. And one side took one version and the other side took the other version. The Thursday version, we had some help, and I didn't get a chance to review it. So now, it's Friday night, the Senate's voting. They were having their debate and I still had not had a chance to review it. So, I walked over, I was up visiting some senators trying to explain some of the background. So I walked over to the chamber and as I walked into the office just off the chamber, it's the vice president's office, somebody gave me a copy. So I looked at the version and said, 'Can't do it. The same language was back in there.'

Q: What was it?

A: Just let me leave it, not too much detail, there were things with regard to our authorities some language around minimization. So it put us in an untenable position. So then I had another version to take a look at, which was our Wednesday version, which basically was unchanged. So I said, well certainly, I'm going to support that Wednesday version. So that's what I said and the vote happened in the Senate and that was on Friday. So now it rolled to the House on Saturday. They took up the bill, they had a spirited debate, my name was invoked several times, not in a favorable light in some cases. (laughs) And they took a vote and it passed 226 to 182, I think. So it's law. The president signed it on Sunday and here we are.

Q: That's far from unanimous. There's obviously going to be more debate on this.

A: There are a couple of issues to just be sensitive to. There's a claim of reverse targeting. Now what that means is we would target somebody in a foreign country who is calling into the United States and our intent is to not go after the bad guy, but to listen to somebody in the United States. That's not legal, it's, it would be a breach of the Fourth Amendment. You can go to jail for that sort of thing. And If a foreign bad guy is calling into the United States, if there's a need to have a warrant, for the person in the United States, you just get a warrant. And so if a terrorist calls in and it's another terrorist, I think the American public would want us to do surveillance of that U.S. person in this case. So we would just get a warrant and do that. It's a manageable thing. On the U.S. persons side it's 100 or less. And then the foreign side, it's in the thousands. Now there's a sense that we're doing massive data mining. In fact, what we're doing is surgical. A telephone number is surgical. So, if you know what number, you can select it out. So that's, we've got a lot of territory to make up with people believing that we're doing things we're not doing.

Q: Even if it's perception, how do you deal with that? You have to do public relations, I assume.

A: Well, one of the things you do is you talk to reporters. And you give them the facts the best you can. Now part of this is a classified world. The fact we're doing it this way means that some Americans are going to die, because we do this mission unknown to the bad guys because they're using a process that we can exploit and the more we talk about it, the more they will go with an alternative means and when they go to an alternative means, remember what I said, a significant portion of what we do, this is not just threats against the United States, this is war in Afghanistan and Iraq.

Q. So you're saying that the reporting and the debate in Congress means that some Americans are going to die?

A. That's what I mean. Because we have made it so public. We used to do these things very differently, but for whatever reason, you know, it's a democratic process and sunshine's a good thing. We need to have the debate. The reason that the FISA law was passed in 1978 was an arrangement was worked out between the Congress and the administration, we did not want to allow this community to conduct surveillance, electronic surveillance, of Americans for foreign intelligence unless you had a warrant, so that was required. So there was no warrant required for a foreign target in a foreign land. And so we are trying to get back to what was the intention of '78. Now because of the claim, counterclaim, mistrust, suspicion, the only way you could make any progress was to have this debate in an open way.

Q. So you don't think there was an alternative way to do this?

A. There may have been an alternative way, but we are where are ...

Q. A better way, I should say.

A. All of my briefs initially were very classified. But it became apparent that we were not going to be able to carry the day if we don't talk to more people.

Q. Some might say that's the price you pay for living in a free society. Do you think that this is necessary that these Americans die?

A. We could have gotten there a different way. We conducted intelligence since World War II and we've maintained a sensitivity as far as sources and methods. It's basically a sources and methods argument. If you don't protect sources and methods then those you target will choose alternative means, different paths. As it is today al-Qaida in Iraq is targeting Americans, specifically the coalition. There are activities supported by other nations to import electronic, or explosively formed projectiles, to do these roadside attacks and what we know about that is often out of very sensitive sources and methods. So the more public it is, then they take it away from us. So that's the tradeoff.

DIVERSITY IN THE INTELLIGENCE COMMUNITY

Q: I wanted to ask you about the diversity question. This has major ramifications here, we have this center of excellence program that's recruiting high school kids, many of whom wouldn't qualify if first generation American citizens weren't allowed.

A: So you agree with me?

Q: It does sound like something that would benefit this area that would also allow you to get people from here who are bicultural and have an openness to seeing things ...

A: You're talking about Hispanics?

Q: Yes.

A: Hispanics are probably the most under-represented group if you think of America, what the ethic makeup of America, Hispanics are the most under-represented group in my community. Now, that said, and should increase that Hispanic population and programs like this will do that. That's why the outreach. But also we need, particularly with the current problem of terrorism, we need to have speakers of Urdu and Farsi and Arabic and people from those cultures that understand the issues of tribes and clans and all the things that go with understanding that part of the world. Varying religions and so on. Because it is, it's almost impossible, I've had the chance to live in the Middle East for years, I've studied it for years, it's impossible to understand it without having some feel for the culture and so on. So while I'm all for increasing the diversity along the lines we talked about, I'm also very much in favor of first generation Americans from the countries that are causing issues and problems.

Q: What is the status of that program.

A: It is not in statue. It is not in policy. It has been habit. So we've stated, as a matter of policy, that we're not going to abide by those habits.

Q: And that's already the case?

A: Yes, and are we making progress? Not fast enough, but we will make progress over time.

Q: How do you measure that?

A: Very simple, you get to measure what are you and where are you trying go and are you making progress. I wrestled with this years ago when I was NSA ....

Q: You don't want quotas, though?

A: Quotas are forbidden so we set goals. My way of thinking about it is what is your end state? Now some would say that federal governments should look like America, whatever that is. OK, that sounded like a reasonable metric, so I said, 'Alright, what does America look like?' So I got a bunch of numbers. I said, 'Alright, what do we look like?' and it didn't match, and as I just told you, the one place where there's the greatest mismatch is Hispanic. It's much closer, as matter of fact, people would be surprised how close it is across, at least my community among the other minorities. Now, that said, numbers don't necessarily equal positioning in the organization. So that's another feature we have to work on, is placement of women and minorities in leadership positions.

Q: So, you're quantifying that as well?

A: Yes.

TERRORIST ACTIVITY ON THE NATION'S SOUTHWEST BORDER

Q: There seems to be very little terrorist-related activity on the Southwest border, which is watched very closely because of the illegal immigration issue. Can you talk about why it's important to be alert here?

A: Let me go back to my NIE, those are unclassified key judgements, pull them down and look at them. You've got committed leadership. You've got a place to train. They've got trainers and they've got recruits. The key now is getting recruits in. So if the key is getting recruits in. So, if you're key is getting recruits in, how would you do that? And so, how would you do that?

Q: I'd go to the northern border where there's nobody watching.

A: And that's a path. Flying in is a path. Taking a ship in is a path. Coming up through the Mexican border is a path. Now are they doing it in great numbers, no. Because we're finding them and we're identifying them and we've got watch lists and we're keeping them at bay. There are numerous situations where people are alive today because we caught them (terrorists). And my point earlier, we catch them or we prevent them because we've got the sources and methods that lets us identify them and do something about it. And you know the more sources and methods are compromised, we have that problem.

Q: And in many cases we don't hear about them?

A: The vast majority you don't hear about. Remember, let me give you a way to think about this. If you've got an issue, you have three potential outcomes, only three. A diplomatic success, an operational success or an intelligence failure. Because all those diplomatic successes and operations successes where there's intelligence contribution, it's not an intelligence success. It's just part of the process. But if there's an intelligence failure ...

Q: Then you hear about it.

A: So, are terrorists coming across the Southwest border? Not in great numbers.

Q: There are some cases?

A: There are some. And would they use it as a path, given it was available to them? In time they will.

Q: If they're successful at it, then they'll probably repeat it.

A: Sure. There were a significant number of Iraqis who came across last year. Smuggled across illegally.

Q: Where was that?

A: Across the Southwest border.

Q: Can you give me anymore detail?

A: I probably could if I had my notebook. It's significant numbers. I'll have somebody get it for you. I don't remember what it is.

Q: The point is it went from a number to (triple) in a single year, because they figured it out. Now some we caught, some we didn't. The ones that get in, what are they going to do? They're going to write home. So, it's not rocket science, word will move around. There's a program now in South America, where you can, once you're in South American countries, you can move around in South America and Central America without a visa. So you get a forged passport in Lebanon or where ever that gets you to South America. Now, no visa, you can move around, and with you're forged passport, as a citizen of whatever, you could come across that border. So, what I'm highlighting is that something ...

Q: Is this how it happened, the cases you're talking about?

A: Yes.

America Under Surveillance

Salon News reports:

In the pre-dawn hours of Sept. 1, 2005, a U-2 surveillance aircraft known as the Dragon Lady lifted off the runway at Beale Air Force Base in California, the home of the U.S. Air Force 9th Reconnaissance Wing and one of the most important outposts in the U.S. intelligence world. Originally built in secret by Lockheed Corp. for the Central Intelligence Agency, the U-2 has provided some of the most sensitive intelligence available to the U.S. government, including thousands of photographs of Soviet and Chinese military bases, North Korean nuclear sites, and war zones from Afghanistan to Iraq.

But the aircraft that took off that September morning wasn't headed overseas to spy on America's enemies. Instead, for the next six hours it flew directly over the U.S. Gulf Coast, capturing hundreds of high-resolution images as Hurricane Katrina, one of the largest storms of the past century, slammed into New Orleans and the surrounding region.

The U-2 photos were matched against satellite imagery captured during and after the disaster by the National Geospatial-Intelligence Agency. Relatively unknown to the public, the NGA was first organized in 1996 from the imagery and mapping divisions of the CIA, the Department of Defense and the National Reconnaissance Office, the agency that builds and maintains the nation's fleet of spy satellites. In 2003, the NGA was formally inaugurated as a combat support agency of the Pentagon. It is responsible for supplying overhead imagery and mapping tools to the military, the CIA and other intelligence agencies -- including the National Security Agency, whose wide-reaching, extrajudicial spying inside the United States under the Bush administration has been a heated political issue since first coming to light in the media nearly two years ago.

The NGA's role in Hurricane Katrina has received little attention outside of a few military and space industry publications. But the agency's close working relationship with the NSA -- whose powers to spy domestically were just expanded with new legislation from Congress -- raises the distinct possibility that the U.S. government could be doing far more than secretly listening in on phone calls as it targets and tracks individuals inside the United States. With the additional capabilities of the NGA and the use of other cutting-edge technologies, the government could also conceivably be following the movements of those individuals minute by minute, watching a person depart from a mosque in, say, Lodi, Calif., or drive a car from Chicago to Detroit.


Prior to Katrina, the NGA had been used sporadically during domestic crises. Its first baptism of fire came after the 9/11 terrorist attacks, when the agency collected imagery to help in the recovery efforts at the World Trade Center and the Pentagon. But the storm of 2005 triggered NGA activity on a scale never before seen inside the borders of the United States. "Hurricane Katrina changed everything with what we do with disasters," John Goolgasian, the director of the NGA's Office of Americas, told Salon. In New York after 9/11, the NGA had only a handful of people on the ground, but "with Katrina, we put a lot of people down in the theater," he said, using a term usually reserved for overseas military battlegrounds. The agency now deploys its staff on a regular basis to hurricane zones and also provides assistance to law enforcement agencies during events such as the Super Bowl, the baseball All-Star Game and political conventions.

On one level, the engagement of the NGA and the U-2 flights over the Gulf Coast during Katrina were commendable efforts to use America's vast surveillance powers for the safety and support of its citizens. But at the same time, the incident apparently marked the first time in history that U.S. intelligence agencies created to spy on foreign countries were deployed to collect extensive information on the U.S. "homeland." Their role during Katrina is just one aspect of an enormous domestic surveillance infrastructure put in place by the Bush administration ever since the Sept. 11 terrorist attacks sparked a radical restructuring and expansion of America's intelligence system. Although the full scope of domestic surveillance under Bush remains elusive, we now know from press accounts, lawsuits, and Attorney General Alberto Gonzales and other top Bush officials' descriptions and denials that the NSA has been involved in multiple domestic surveillance programs -- in apparent violation of federal law -- including spying on Americans' telecommunications and Internet traffic, as well as data mining.

In December 2004, the NSA and the NGA announced the signing of an agreement to share resources and staff and to link their "sources, data holdings, information infrastructure, and exploitation techniques." The document spelling out the agreement itself is classified. But in a press release the NGA explained that the pact allows "horizontal integration" between the two agencies, defined as "working together from start to finish, using NGA's 'eyes' and NSA 'ears.'"

The collaboration makes it possible for the agencies to create hybrid intelligence tools that enhance the ability of U.S. forces in combat. By combining intercepts of cellphone calls with overhead imagery gathered by unmanned aerial vehicles (UAVs), for example, intelligence analysts can track suspected terrorists or insurgents in Iraq in real time. Last November, NGA director Robert B. Murrett disclosed that it was through such technology that the U.S. military was able to locate and bomb the safe house where Abu Musab al-Zarqawi, the leader of al-Qaida in Iraq, was staying in June 2006. "Eventually, it all comes down to physical location," he told reporters. When NSA and NGA data are combined, he added, "the multiplier effect is dramatic."

Nine months prior, during Hurricane Katrina, the NGA's sophisticated surveillance tools, which can create three-dimensional maps, helped first responders identify hospitals, schools and areas where hazardous materials were stored in the Gulf Coast region. And in an unprecedented move, the NGA distributed thousands of unclassified images of stricken areas, via the Internet, to the public. "People could actually see their houses," said retired Air Force Gen. James R. Clapper, the NGA director at the time of Katrina. In an interview with Salon before his appointment in April as undersecretary of defense for intelligence, Clapper said that the NGA's work during the hurricane was "the most graphic example in my 40 years of intelligence of coming to the direct aid of people in extreme circumstances."


The purpose and utility of such intelligence tools in a disaster area, or in a war zone, are clear. But given the Bush administration's highly secretive, aggressive policies in the war on terror, what's to stop the NGA and the NSA from collaborating on other types of real-time surveillance at home?

This past Saturday, Congress approved legislation expanding the ability of the National Security Agency to eavesdrop, without warrants, on telephone calls, e-mail and faxes passing through telecommunications hubs in the United States when the government suspects terrorists may be involved. The legislation, which expands the 1978 Foreign Intelligence Surveillance Act, or FISA, was negotiated between the White House and lawmakers in response to a federal court ruling this summer determining that the NSA's past eavesdropping had violated the law. Mike McConnell, the retired Navy admiral who was appointed last January as the nation's second director of national intelligence, told Congress that the ruling drastically reduced the ability of the NSA to track terrorists, while Bush warned that, because of the ruling, the government was "missing a significant amount of foreign intelligence that we should be collecting to protect our country."

The fear of Democratic leaders that their party might be further accused of being soft on terrorism apparently prompted them to vote for the new FISA legislation -- handing new unilateral surveillance powers to the executive branch while significantly diminishing judicial oversight. Civil liberties groups and lawmakers opposed to the legislation believe the changes will make it easier for the government to spy on U.S. citizens, because the more loosely defined FISA statute now allows warrantless surveillance of people communicating with others who are "reasonably believed to be outside the United States." During the House debate last Saturday night, Rep. Zoe Lofgren, D-Calif., described the bill as an enormous loophole that will grant the attorney general the ability to "wiretap anybody, any place, any time without court review, without any checks and balances."

President Bush signed the measure into law on Sunday.


The NGA, which has a staff of 14,000 and an estimated budget of about $2.5 billion (the actual amount is classified), buys most of its imagery from commercial satellite vendors, but it also relies on highly classified overhead photography captured by the National Reconnaissance Office's fleet of military satellites. According to David H. Burpee, the NGA's director of public affairs, the agency operates under strict oversight rules that ban it from collecting imagery over the United States without a formal request from a "lead" domestic agency coordinating efforts during a disaster. In the case of Katrina, the NGA's assistance was requested by the Federal Emergency Management Administration. In a statement to Salon, Burpee said that the NGA collects intelligence "in accordance with Constitutional law, federal law, and executive policies such as Executive Order 12333." (That order, signed in 1981 by President Reagan, includes a mandate for federal agencies to cooperate with the CIA and other intelligence agencies.) Any questions involving domestic operations would have to be directed to the lead agency requesting NGA support, Burpee added.

It is unclear how the latest changes to FISA might affect other intelligence agencies besides the NSA. But the zeal with which McConnell and Bush pursued the new legislation unbridling the NSA -- which could presumably tap the NGA for assistance with operations at home, just as it does in the war zones -- raises stark questions about the administration's intentions with domestic intelligence.

A close look at the NSA programs suggests that the Bush administration is casting the widest net possible. To date, President Bush and administration officials have acknowledged only a narrow aspect of domestic spying -- referred to as the Terrorist Surveillance Program -- which they admitted, in the wake of media reports, included the warrantless wiretapping of phone calls. But in May 2006, USA Today reported on a program that involved the NSA's gaining access to huge customer databases maintained by AT&T and other telecommunications providers. In another alleged program, discovered by AT&T technician Mark Klein and disclosed in a lawsuit against the telecom provider filed by the Electronic Frontier Foundation, the NSA attached what amounts to an electronic hose to AT&T Internet data lines in San Francisco and other cities and diverted global Internet traffic and phone calls to a special room, where calls and messages were analyzed with powerful computers to find clues to terrorist cells. A Salon report in June 2006 uncovered what appeared to be a nexus for such activity in a secret room at an AT&T facility in St. Louis.


Then, last month, the New York Times disclosed that a dispute in 2003 between the White House and the Justice Department over NSA operations involved a potential fourth program using "computer searches through massive electronic databases" that contained the records of tens of thousands of domestic phone calls and e-mails. McConnell acknowledged multiple programs, albeit without specifics, in a July 31 letter to Arlen Specter, the ranking Republican on the Senate Judiciary Committee. "A number of these intelligence activities were authorized in one order" by Bush shortly after 9/11, McConnell wrote. With regard to the administration's Terrorist Surveillance Program, he added: "This is the only aspect of the NSA activities that can be discussed publicly, because it is the only aspect of those various activities whose existence has been officially acknowledged." Many FISA experts, such as James Dempsey of the Center for Democracy and Technology, have concluded that the NSA was running at least three domestic surveillance programs, including data mining. "I think the TSP was an after-the-fact name given to an activity, or a set of activities, or a whole subset of activities" by the NSA, Dempsey said.

After 9/11, the paradigm for domestic law enforcement shifted radically, by making it the duty of the government to use its intelligence resources to help law enforcement agencies preempt attacks before they happened, beyond the traditional practice of gathering evidence to prove that a crime had already occurred. The idea that the U.S. homeland was now a battleground (or a "theater") first took hold in 2002, when the Pentagon established the U.S. Northern Command in Colorado to provide command and control of military efforts within U.S. borders. Northcom was given two primary responsibilities: providing military security during national emergencies, including terrorist attacks and natural disasters; and protecting important U.S. military bases in the 50 states. As part of the Pentagon's domestic security mission, former Secretary of Defense Donald Rumsfeld created the Counter-Intelligence Field Activity (CIFA) in 2002. But CIFA soon became a weapon against anyone suspected of harboring ill-will against the Bush administration and its policies. CIFA was caught spying on antiwar groups, Quakers and other organizations. Even though Clapper and his boss, Secretary of Defense Bob Gates, have expressed concerns about CIFA's reach, the agency remains an integral part of the Pentagon's counterterrorism efforts.

The link between Pentagon-driven intelligence operations and the homeland was underscored during the Katrina crisis by the NGA's deployment to New Orleans of a special vehicle called a Mobile Integrated Geospatial-Intelligence System, or MIGS, which is loaded with equipment that allows NGA analysts to download intelligence from U-2s and U.S. military satellites. The vehicles were first deployed by the NGA in Iraq and Afghanistan, and later to the Gulf Coast. "They're pretty much the NGA in a Humvee -- very military," said Goolgasian, the NGA official. "But it kind of sticks out like a sore thumb if you're driving into an urban area" in the United States. As a result, the NGA has painted its domestic vehicles blue and renamed them Domestic MIGS, or DMIGS.

Military, intelligence agency and police work is also coming together in numerous "fusion centers" around the country in a joint program run by the Department of Justice and Department of Homeland Security that has received little public attention. At present, there are 43 current and planned fusion centers in the United States where information from intelligence agencies, the FBI, local police, private sector databases and anonymous tipsters is combined and analyzed by counterterrorism analysts. DHS hopes to create a wide network of such centers that would be tied into the agency's day-to-day activities, according to the Electronic Privacy Information Center. The project, according to EPIC, "inculcates DHS with enormous domestic surveillance powers and evokes comparisons with the publicly condemned domestic surveillance program of COINTELPRO," the 1960s program by the FBI aimed at destroying groups on the American political left.


It doesn't take much imagination to see how powerful technologies, when combined with secretive, growing interagency collaboration, could be misused in a domestic context. In recent years many U.S. cities have deployed sophisticated video cameras throughout their downtown areas that track activity 24 hours a day. And U.S. intelligence and law enforcement agencies now have at their disposal facial recognition software that can identify one person among thousands in a large crowd. Combine that with the awesome eavesdropping power of the NSA and the ability of the NGA to capture live imagery from satellites and UAVs, and the result could be an ability to track any individual, in real time, as he or she moves around.

John Pike, the director of GlobalSecurity.org, said the NGA is unlikely to be called upon for surveillance of an individual inside the United States. "NGA imagery is not what you would use to track people," he said. But as the intelligence infrastructure, including the kinds of local camera-surveillance systems that proved so useful in identifying the perpetrators of the London subway bombings, expands in the United States, it raises the specter of a nationwide surveillance web. "These networks are going to get denser and going to cover more area over time," Pike said. "At some point in time somebody's going to drop in an automated face-print recognizer, and then they're off to the races. Anybody who is currently wanted by the authorities, well, there's just going to be parts of the country where such a person could not enter."

The expanding role of U.S. intelligence agencies on the home front raises serious issues, according to Army Lt. Gen. Russel L. Honoré, the commanding general on the scene in the Gulf Coast during Hurricane Katrina. Last fall, during a national conference on geospatial intelligence, he said, "Most of our capability [in the military] is kept on the classified side because that's the best way to fight the enemy." But the situation in the Gulf Coast, as the lines blurred, was complicated by conflicting policy directives. There were some people in government saying, "You're not going to use the intel stuff on us," Honoré recalled, while others were saying just the opposite: "Why aren't you using that intel stuff to tell us what's going on down there?" And then, there were people sitting back, saying, "They can't do that inside the United States," he said, adding, "This is one of the things government has to work out."

In light of the mounting revelations about the Bush administration's domestic spying, civil libertarians no doubt strongly agree.

Revealed: U.S. Dirty Tricks To Win Vote On Iraq War

Secret document details American plan to bug phones and emails of key Security Council members

The Guardian reports:

The United States is conducting a secret 'dirty tricks' campaign against UN Security Council delegations in New York as part of its battle to win votes in favour of war against Iraq.

Details of the aggressive surveillance operation, which involves interception of the home and office telephones and the emails of UN delegates in New York, are revealed in a document leaked to The Observer.

The disclosures were made in a memorandum written by a top official at the National Security Agency - the US body which intercepts communications around the world - and circulated to both senior agents in his organisation and to a friendly foreign intelligence agency asking for its input.

The memo describes orders to staff at the agency, whose work is clouded in secrecy, to step up its surveillance operations 'particularly directed at... UN Security Council Members (minus US and GBR, of course)' to provide up-to-the-minute intelligence for Bush officials on the voting intentions of UN members regarding the issue of Iraq.

The leaked memorandum makes clear that the target of the heightened surveillance efforts are the delegations from Angola, Cameroon, Chile, Mexico, Guinea and Pakistan at the UN headquarters in New York - the so-called 'Middle Six' delegations whose votes are being fought over by the pro-war party, led by the US and Britain, and the party arguing for more time for UN inspections, led by France, China and Russia.

The memo is directed at senior NSA officials and advises them that the agency is 'mounting a surge' aimed at gleaning information not only on how delegations on the Security Council will vote on any second resolution on Iraq, but also 'policies', 'negotiating positions', 'alliances' and 'dependencies' - the 'whole gamut of information that could give US policymakers an edge in obtaining results favourable to US goals or to head off surprises'.

Dated 31 January 2003, the memo was circulated four days after the UN's chief weapons inspector Hans Blix produced his interim report on Iraqi compliance with UN resolution 1441.

It was sent by Frank Koza, chief of staff in the 'Regional Targets' section of the NSA, which spies on countries that are viewed as strategically important for United States interests.

Koza specifies that the information will be used for the US's 'QRC' - Quick Response Capability - 'against' the key delegations.

Suggesting the levels of surveillance of both the office and home phones of UN delegation members, Koza also asks regional managers to make sure that their staff also 'pay attention to existing non-UN Security Council Member UN-related and domestic comms [office and home telephones] for anything useful related to Security Council deliberations'.

Koza also addresses himself to the foreign agency, saying: 'We'd appreciate your support in getting the word to your analysts who might have similar more indirect access to valuable information from accesses in your product lines [ie, intelligence sources].' Koza makes clear it is an informal request at this juncture, but adds: 'I suspect that you'll be hearing more along these lines in formal channels.'

Disclosure of the US operation comes in the week that Blix will make what many expect to be his final report to the Security Council.

It also comes amid increasingly threatening noises from the US towards undecided countries on the Security Council who have been warned of the unpleasant economic consequences of standing up to the US.

Sources in Washington familiar with the operation said last week that there had been a division among Bush administration officials over whether to pursue such a high-intensity surveillance campaign with some warning of the serious consequences of discovery.

The existence of the surveillance operation, understood to have been requested by President Bush's National Security Adviser, Condoleezza Rice, is deeply embarrassing to the Americans in the middle of their efforts to win over the undecided delegations.

The language and content of the memo were judged to be authentic by three former intelligence operatives shown it by The Observer. We were also able to establish that Frank Koza does work for the NSA and could confirm his senior post in the Regional Targets section of the organisation.

The NSA main switchboard put The Observer through to extension 6727 at the agency which was answered by an assistant, who confirmed it was Koza's office. However, when The Observer asked to talk to Koza about the surveillance of diplomatic missions at the United Nations, it was then told 'You have reached the wrong number'.

On protesting that the assistant had just said this was Koza's extension, the assistant repeated that it was an erroneous extension, and hung up.

While many diplomats at the UN assume they are being bugged, the memo reveals for the first time the scope and scale of US communications intercepts targeted against the New York-based missions.

The disclosure comes at a time when diplomats from the countries have been complaining about the outright 'hostility' of US tactics in recent days to persuade then to fall in line, including threats to economic and aid packages.

The operation appears to have been spotted by rival organisations in Europe. 'The Americans are being very purposeful about this,' said a source at a European intelligence agency when asked about the US surveillance efforts.