Room SD-106
Dirksen Senate Office Building
Washington, D.C.
Friday, January 19, 1996

CHAIRMAN BROWN: Our next witness is Dr. Richard Haass, who currently is Director of National Security Programs and a senior fellow at the Council on Foreign Relations.

In fact, he has recently directed a study, a study run by a task force sponsored by the Council on Foreign Relations having to do with intelligence. He has had extensive Government experience, serving as Senior Director for Near East and South Asian Affairs on the NSC staff and in various Defense and State Department posts, and as a legislative aide in the Senate, and he has had also an academic career as a senior associate at the Carnegie Endowment and lecturer in public policy at the Kennedy School.

We welcome him here today. He will be presenting some of the results of that task force at the council, but I think also some personal views of his own.

Please proceed, Dr. Haass.


DR. HAASS: Thank you, Dr. Brown. I very much appreciate this opportunity particularly to appear before you and several of my former friends.


DR. HAASS: Current friends and former colleagues -- I seem to have been more honest than perhaps I intended to be. I do appreciate this chance to be here today.

If I may echo what several of those who came before me had to say, you've all got an important responsibility here. If there is a clear need to reform U.S. intelligence, and I think there is, there's probably no less of a need to make sure that it is not fixed more than it is broke.

Intelligence remains a critical resource and tool, and its maintenance and improvement ought to be a national security priority of the United States.

Let me just say my own involvement with intelligence comes from three directions. To make clear my bona fides, such as they are, I spent over 10 years as a consumer of intelligence in various roles in the executive branch and also on the Hill. Secondly, I was a consultant to the Bureau of Intelligence and Research at the State Department during the 1980's. And thirdly and most recently, I directed a project sponsored by the Council on Foreign Relations.

It was chaired by Hank Greenberg of American International Group, and consisted of around 25 people looking at the full gamut of issues on the future of U.S. intelligence. Our report will be published in a few weeks.

It offers judgments and makes recommendations on a full range of issues, including the need for intelligence in the post-Cold War world, collection priorities in particular, the process of setting requirements, improving analysis, how to do that and how to increase its impact, economic intelligence, clandestine activities, organizational questions, military intelligence, the issues that Bill Barr just spoke about in detail, that is, the relationship between intelligence and law enforcement, and lastly, the question of oversight, be it by Congress or by others.

Needless to say, I'll be glad to discuss any of these. What I thought I'd do, though, is just highlight six subjects from my short prepared statement.

The first, and perhaps most important, not so much for you all, but for a broader audience, is the continuing need in this country for a capacity within the U.S. Government to collect, produce, and disseminate intelligence.

The end of the Cold War, whatever else it has done, has not ushered in an age of peace and security, nor is the need for intelligence in any way eliminated by new sources of publicly available information.

There are still important but hard-to-learn facts about targets, including, for example, the intentions and capabilities of rogue states and terrorists, the proliferation of unconventional weapons, and the disposition of hostile or potentially hostile military forces, that can only be identified, monitored, and measured through dedicated intelligence assets.

When I am asked what is the principal finding of our group, I say it is essentially just this, that despite the end of the Cold War, despite the Internet, and despite Mr. Ames, there is still a clear and strong need for an effective, in-house capability within the U.S. Government to produce quality intelligence.

The ultimate purpose of U.S. intelligence is to enhance U.S. national security by informing policymakers and supporting military operations. Toward these ends, one of the most important functions of the intelligence community, but one that is often overlooked, is to provide analysis gleaned from all sources, open as well as closed or secret, and to package it in a manner that is timely and useful for policymakers.

Only the intelligence community performs this essential integrative function, and if it were not performed by the intelligence community, it would have to be performed elsewhere.

I would also say that the United States enjoys a position of unique power and, as a result, great opportunity in the post-Cold War world. Intelligence, not simply the knowing but the sharing of it, thus becomes an important tool.

Intelligence enables others, be it friendly governments, alliances, and U.N. agencies such as the International Atomic Energy Agency, to be more effective in dealing with common challenges. Many multilateral efforts that we care about can only succeed if the United States possesses and then is willing to share the available intelligence.

As a result, intelligence can be a critical tool in this effort, almost expanding the capacity of others as a multiplier if you will, so long as, adequate safeguards can be built into the process in order to protect classified information.

A second area I would like to touch on is how to improve analysis. The simple answer is that the best way to ensure high- quality analysis is to bring high-quality analysts into the process. Analysis would, of course, be improved by increasing the flow of talented people into the intelligence community from the outside.

For example, I would think that greater provision could and should be made for lateral and mid-career entry of such analysts, as well as for their short-term involvement in specific projects. Closer ties between universities and the intelligence community would be desirable in this regard.

On a personal note, I think it is one of the unfortunate legacies of the 1960's that somehow the intelligence community and the CIA in particular became unwelcome on so many campuses. To the extent that one can make it once again acceptable for people in academic departments to work closely with the intelligence community, I think that would be good for people on both sides of that relationship.

In addition, careerists in the intelligence community would benefit from greater opportunities to spend time in other government departments and also on the outside, for example, in businesses involved in commerce and finance.

Another way to improve analysis would be through competitive or redundant analysis. It needs to be carried out and conveyed to policymakers in those areas where being wrong can have major consequences.

Emphasis on long-term estimates of familiar subjects and broad trends, though, should be reduced, given the lack of consumer interest and the low comparative advantage of the intelligence community in this area.

Any such estimates, if they are done, should be short, written by individuals, and have sources identified where they lead to major conclusions. If they are done by groups, then areas of consensus and disagreement alike ought to be highlighted.

Prioritization is a must. The highest priorities for U.S. intelligence collection and, in most cases, analysis for the foreseeable future can be identified.

If I were to list them, I would include, first, the status of nuclear weapons and materials in the former Soviet Union. Second, developments in the principal rogue states: Iraq, Iran, and North Korea. Third, potential terrorism against U.S. targets in the U.S. and overseas. Fourth, unconventional weapons proliferation more broadly, and fifth, political and military developments in China.

Other subjects could be added to this list. For example, for the period of 1996, one would add Bosnia to that list, or any other time U.S. forces were deployed abroad in large numbers. But it is an important that we have a short, manageable list of priorities. If we try to do everything everywhere, we are unlikely to do it well.

The danger of politicization, the potential for the intelligence community to distort information or judgment in order to please the political authorities of the day, is real, and obviously can never be eliminated if intelligence officials are involved, as they must be, in the policy process.

The challenge, though, is to develop reasonable safeguards while permitting intelligence producers and policymaking consumers to interact. Guarding against political pressure, guarding against parochialism is, in my way of thinking, a powerful argument for maintaining a strong, centralized capability, and not leaving decisions affecting important intelligence-related questions solely to the policymaking departments.

Unlike business, the customer is not always right. Decentralization of analysis should be limited to those questions with little or no impact beyond the agency in question.

Intelligence can protect itself from political pressure through a number of means, including competitive analysis of controversial questions. I would add that guarding against politicization is also a usual function for Congress and for the President's Foreign Intelligence Advisory Board.

Perhaps most important, though, guarding against political pressures is the responsibility of the intelligence community itself. It should reinforce the ethic that speaking the truth to those in power is required, and defend anyone who comes under criticism for so doing.

The third critical subject I'd like to touch on briefly involves organizational questions. The position of the Director of Central Intelligence, the DCI, should be strengthened so that he can wield greater influence over the various components of the intelligence community.

Greater centralization ought to allow for resource decisions that reflect national priorities, and not choices that would otherwise be driven by those who oversee, for example, the technical collection programs, or who are concerned simply with military programs. Such a centralized approach would create one person with a community-wide perspective and the ability to determine which systems and issues receive priority.

The intelligence community would, at least in principle, be more responsive to change if this were done. This can best, and most easily, be accomplished accomplished by bolstering the DCI in the current context, that is, with his two hats, both as Director of the Central Intelligence Agency and as the Director of Central Intelligence. He could be given the right to nominate and reject nominations to head other agencies. He could also be given the authority to determine budgets and to be able to move people and resources to respond to changing circumstances. Indeed, the result would be a DCI similar to what was planned nearly a half-century ago.

The advantage of this approach, of strengthening the DCI, is that it involves little structural change, and would give one person greater control. He already has in place many of the resources he would need to take on this large a burden.

Still, I recognize any centralization of authority would bring with it the danger of making bigger mistakes. Moreover, power of appointment of top personnel could easily result in an attempt to force consensus under increased political pressures.

Lastly, I also recognize it asks a great deal of any one individual to be both a referee and a player, and there's the danger that the DCI will inevitably favor the interests of the CIA if he remains responsible for it as well.

That said, I still think the advantages of such reform outweigh the potential risks, and moreover, the dangers of this type of a centralizing reform can be offset by establishing an appeals mechanism for serious disagreements, and by making sure there is sufficient oversight.

Closely related to this question of strengthening the DCI is the controversial matter of what might be called the growing militarization of American intelligence. There are grounds for concern about the influence exerted by the Defense Department and by defense-related concerns. There is a danger that spending on intelligence to support military operations will take priority over other important, or even vital, national security ends in which intelligence is needed.

There is a related concern that the voice of the Defense Department will grow too strong, something which reflects the organizational reality that the Defense Department manages the large collection programs that consume a significant share of the resources that go to intelligence.

It is one thing for the bulk of the intelligence effort to be devoted to supporting military operations, but it's quite another thing for the Department of Defense to have a dominant voice in determining this allocation. For this reason, while reasons of efficiency might support the consolidation of a new agency devoted to imagery and mapping functions, I, for one, am not persuaded of the desirability of locating this new organization within the realm of defense.

The fourth area that I would like to highlight is the realm of clandestine operations. At the start, I would simply say that maintaining and enhancing clandestine capabilities takes time and resources, but that creating and nurturing this capability ought to be a high priority.

The most important function of the clandestine services is to collect human intelligence. As you know, such intelligence can complement other sources, and in certain instances it can be the principal or sole source of information. This tends to be especially true in closed societies, where decision-making and information is limited to a few, where highly valued efforts are meant to be kept secret, or where the targeted activity is not easily captured, by reconnaissance or by eavesdropping.

Human intelligence can also shed special understanding or light on intentions as well as capabilities. Such knowledge, for example, is likely to prove crucial in tracking the activities of terrorists or in determining the status of unconventional weapons programs.

The capability to undertake these and other tasks, be it to frustrate a terrorist action, to intercept some technology or equipment that would help a rogue state or group build a nuclear device, or to assist some group to overthrow a leadership whose action threatened U.S. interests, would constitute an important tool, one that can provide policymakers a valuable alternative or complement to diplomacy, sanctions, and military intervention.

So in short, clandestine operations, whether they are for the purpose of collecting human intelligence, or whether they are for the purpose of carrying out covert operations, is terribly important.

Let me just add two other points on this. Firstly, I realize that the process of carrying out clandestine activities, for whatever set of purposes, will often require that the United States associate itself with individuals of what you might call unsavory reputations, people who have in some instances committed crimes. I would think this is akin to the tradition in law enforcement of using criminals to catch criminals.

This policy ought to be acceptable to the United States so long as the likely benefits of any such association outweigh the certain moral and political costs of the association, a calculation that probably ought not to be made simply by the individual in the field.

The only other word of caution I would add here, in addition to the obvious ones of ensuring legality, of maintaining sufficient control and oversight, is that any covert action must appear consistent with established U.S. policy, so that if it is discovered, if it does become known publicly, the purposes behind the effort would be more likely to be understood.

Clandestine operations, for whatever set of purposes, be it to collect intelligence, whether for counterintelligence or to carry out covert operations, are circumscribed, as you know, by a number of legal and policy constraints. I think these constraints deserve review to avoid diminishing the potential contribution of this instrument.

At a minimum, I would highlight two areas here. First, a fresh look should be taken at the limits on the use of nonofficial covers for hiding and protecting those involved in clandestine activities. Second, rules that can prohibit preemptive attacks on terrorists or support for individuals who are hoping to bring about regime change ought to be assessed.

I'd like to make one other point on the clandestine side, which is to simply say that obviously constant vigilance inside the CIA is needed. In this area, like anyone else who follows the subject at all, I am aware of the controversy. But I would also say that those in the Operations Directorate should know that risk-taking will be supported, and that they will be politically protected so long as what they do is authorized and legal under U.S. law. Such support, in my view, is crucial.

I would add a personal note here, that contrary to widespread impressions, one problem with the clandestine service has been a lack of initiative brought about by a fear of often retroactive discipline and a lack of high level support. This has to be rectified if the intelligence community is going to continue to produce human intelligence.

I'd like to end this opening statement by simply referring to two other subjects. The first is economic intelligence. As a rule, economic intelligence should not be used offensively to help a U.S. firm win a contract against foreign competition. Rather, economic intelligence should be used defensively, to alert policymakers when bribes or other unfair practices are being used against an American firm.

Counterintelligence can be used to help protect U.S. firms from the espionage of other firms or foreign governments. In short, leveling the playing field is appropriate. Tilting it is not.

Otherwise, though, I would say that the boundaries of economic intelligence are less obvious. In the task force project that I just directed, for example, it was probably the single most controversial item that we considered over the course of the last year. For example, the task force could not agree on how aggressively the United States should collect information on its major economic partners -- for example, Japan, Germany, what-have-you -- or on how much to emphasize analysis of economic issues.

There were those members of the task force, including myself, who believed that collection of intelligence for economic purposes can easily cause more problems with our major trading partners than it purports to solve. This suggests, in my view, the need for clear caution in collecting intelligence, especially humint, for economic purposes.

Others on the task force, though, believed just the opposite. They believed that such collection is an accepted practice among states, and that the political costs of being discovered are worth bearing, given the importance of economic issues and the potential value of this information.

The second area of disagreement on the task force involving economic issues concerned mostly analysis and the degree to which the intelligence community should focus on long-term or strategic questions. Many members of the task force felt this was a priority. For example, they would cite the economic health of Mexico, or the economic situation in China or Russia.

I sided, though, with other members of the task force, who argued that, while these were important questions, the U.S. Government would do better to rely mostly on open sources in the academic world or in the world of business. In my view, the intelligence community has little or no comparative advantage in undertaking such broad-based economic assessments, and should focus whatever collection and analysis it does do in the economic realm where it really can make a difference.

My final point concerns the future. As you, better than anyone, know, there's a great deal of reform-oriented activity taking place right now in the intelligence realm. It involves the intelligence community itself, it involves this commission, it involves congressional committees, and it involves groups such as the one I participated in.

In my view, there is a real need for follow-up and coordination. In some areas, I think there is need for additional work. Let me cite a few.

Most important is defense intelligence. There is a need for a clear division of labor here so that redundancies within the Department of Defense can be avoided. For example, the desirability of maintaining large service intelligence organizations is unclear. The services are charged with the mission of equipping and training their personnel, and any intelligence not tied to these specific service missions ought to be eliminated and located elsewhere.

Rationalizing defense intelligence and the roles of the military services, the Joint Chiefs of Staff, the Defense Intelligence Agency, commanders in the field, and the Office of the Secretary of Defense, is a task that a stronger DCI or the Secretary of Defense should undertake as an urgent priority.

I'd also cite the entire area of the relationship between intelligence and law enforcement as one that merits additional examination. In my view, foreign policy ought to normally take precedence over law enforcement overseas. As a result, FBI and DEA agents operating abroad should not be allowed to operate independently of the ambassador or the CIA, lest they risk causing major foreign policy problems or complicating ongoing intelligence efforts.

Having said this, I would simply reiterate my view that this is one of the areas that needs further analysis. There are also a few other candidates for follow-up work. One would be the PFIAB, the President's Foreign Intelligence Advisory Board, and the possibility of recasting it along the lines of this commission so in a sense it is not simply the President's board but one that is responsible to Congress as well.

Secondly, I think there's a case for considering the creation of an intelligence reserve that would support the DCI and the intelligence community for dealing with unanticipated crises in low priority areas.

It was, for example, impossible to know several years ago that U.S. forces would have been deployed in the mid-1990's to Rwanda, to Bosnia, to Somalia, to Haiti, and there is no way that the standing intelligence community can devote assets to every possible place where U.S. forces are going to have to go. The idea of creating some sort of an intelligence reserve is something that ought to be looked into.

A third area of possible reform involves the Congress itself, where perhaps the time has come to normalize the intelligence committees, rather than see them as something special and different.

I would end by suggesting there's one other need for continued work, and this stems from my concern that once this commission, once you all, go out of business, that we will have lost the best way to bring together the executive and Congress on the task of reforming intelligence. I say this not to please you here today, but out of a real concern that the momentum towards intelligence reform could well be lost.

As a result, I think there is a strong argument for the President, drawing on his principal advisors and working closely with the DCI and other members of the intelligence community, the bipartisan leadership of Congress, the members of this commission, and the President's Foreign Intelligence Advisory Board, to consider establishing a steering group, if you will, a standing commission, to look at legislation and to propose reform and to see that it happens. Otherwise, I fear that the opportunity and the necessity to improve U.S. intelligence could well be lost.

Thank you very much, Mr. Chairman.

CHAIRMAN BROWN: Thank you very much, Dr. Haass.

I think this is an unusually comprehensive review of this, and examination of this strange country called "intelligence." The Commission itself has covered much of the same terrain and finds it quite similar, although a few of the plants, animals, and man-made structures that we see may be different from the ones that you have presented.

In addition, I think you've given us a couple of new ideas that are worthy of consideration, although the perpetuation, in any form, of this Commission is not one that's likely to be greeted favorably by those of us on this side of the table.

I do have one area in which I'd like to concentrate my questions and perhaps a colloquy with you. It has to do with the process of determining the distribution of resources for intelligence, the great bulk of which goes to technical collection, as a matter of fact, the priority of collection, that is, as a long- term matter, which issues are more important -- you've mentioned some of those -- and finally, the relative priority at a given time, which is not the same thing.

In each of those, you've allocated, understandably, an increased role to the DCI, at the cost, in some cases, or at the expense in some cases of the consumers. You've said, this is a case where the customer doesn't always know what's right. That, of course, was Henry Ford's view, and it worked then. It doesn't work now, at least not for his successors.

In approaching this question, I would like to focus first of all on the following issue. It deals with the balance between military needs and other needs, which is, I think, an important question, and not an easy one.

Consider the following thought experiment. Suppose that the U.S. had a military capability, maybe quite a bit smaller than it has, but adopted a Japanese approach. That is, military operations would never be used; there would be no military operations. You might do some military planning.

Under those circumstances -- and I ask this in trying to think what priority should be given to the support of military operations as an intelligence matter -- what do you think the size of the intelligence budget of the United States would be compared to what it is, and I'm asking for a ratio.

DR. HAASS: Considerably smaller, and if you're asking me whether it would be one-tenth or one-fifth, we could argue that.

CHAIRMAN BROWN: A lot smaller.

DR. HAASS: A lot smaller.

CHAIRMAN BROWN: Which suggests that support for military operations is a large part of the rationale for U.S. intelligence capability, even when it's not being used for that purpose, which is not most of the time.

DR. HAASS: Well, let me slightly revisit my answer in the sense that some of the things that the intelligence community does, it would have to do anyway. For example, expensive overhead systems needed to collect information to support diplomacy would not go away.

Now, we wouldn't need it to be as extensive if we didn't have to support military operations, which is another way of saying that even though the military is the largest consumer, it is not the only consumer of a lot of our collections.

CHAIRMAN BROWN: I said the same thing when I said most of the time it's not used for the support of military operations, but, indeed, the need would exist. I was asking how well you thought it would be supported.

DR. HAASS: Obviously, it would not be as popular, if that's what you're getting at.

CHAIRMAN BROWN: And you gave the answer one-tenth, or one-fifth, and then when you thought about it again said, but we need more than that, but that's not the same thing as getting it.

I'm just trying to get an estimate of importance as reflected in fund appropriations that the country attaches to support of military operations. It certainly would be a different system, as you say. You wouldn't need nearly as much, and you wouldn't need it as soon, and that makes a big, big difference in the cost. That, it seems to me, should be a factor in considering the priority.

You mentioned it as an afterthought. You gave a list, and then you said, when there are military operations, they ought to be added to the priority list.

Well, in fact, when you make the resource decisions, you can't make them at the time of the military operations, you have to make them 5 years, 10 years in advance, and that suggests to me -- you may have a different view -- that the military ought to be fairly substantially considered in making those resource decisions.

DR. HAASS: I would say two things. One, when I listed the priorities, when I listed places like Iran, Iraq, and Korea, those are obviously theaters where I would think that U.S. forces might conceivably be used on a large scale.

Places like Bosnia are places where U.S. interests, whatever else they may be described as, are not vital, were not predictably vital say, 5 years ago, and as a result, those are, if you will, crises of opportunity that we have to deal with.

Secondly, I would say that it's one thing for DOD, for the Defense Department, to be considered, it's even one thing for DOD to be considered quite a lot and to have a large voice, but it is quite another thing for the Defense Department to be the organization that oversees the decision-making process.

I have no problem with DOD at the end of the day getting the lion's share of the resources. I am worried by DOD having the lion's share of the input into the decision-making process and the management of deciding, for example, what types of systems we are going to have for collection in the future, and how existing systems are necessarily going to be allocated. I want DOD to have to compete for those decisions rather than to necessarily manage them by itself.

CHAIRMAN BROWN: I think that's a useful distinction, because the Department of Defense is not the only user by any means.

But now let me turn to the issue of relative priorities. My understanding of what you said was that the DCI should be the principal determiner not only of the issue of how to collect, but what the intelligence priorities and requirements are, rather than having the customers do that, so that both long-term and short-term at any one time, the DCI should determine the relative priority of support to military operations, environment, and political developments in China.

I find that a little curious. I don't think that the Secretary of Defense should determine it. I don't think the DCI should determine it. I wonder what is the proper mechanism?

DR. HAASS: I think it has to be determined, and I think it is important to make a distinction between intelligence priorities and national security priorities. They're not the same list.

Intelligence priorities must reflect things that are not only inherently important, but they must represent as well those things where intelligence has the unique ability to make a contribution. I would think that's where the intelligence community ought to have a disproportionately large role.

Now, as you know from what I said, I didn't say it ought to be the DCI alone. Obviously, others have to be involved, and then there has to be a review process if people feel he is making decisions that are simply flat out wrong. But I do think that there ought to be and needs to be one person who at least has the principal, primary responsibility for making the decision, so long as others have a chance to get their oar in, and after the fact they will have a chance to revisit the decision if they disagree.

CHAIRMAN BROWN: What will be the review process?

DR. HAASS: I would think that one would essentially build upon the institutional responsibility of the National Security Council and take advantage of that.

CHAIRMAN BROWN: Thank you. That's very helpful.

VICE CHAIRMAN RUDMAN: Thank you, Mr. Chairman.

Two issues that we just touched on what I want to ask you about briefly. You spoke of the necessity of the sharing of intelligence, the broadening, if you will, of what we do by sharing it with others, and the multiplier effect that that brings on. One of the great concerns in the recent years -- after the Somalia operation -- and, by the way, PFIAB did a study of that for President Clinton; that study has not been released, but it was a very thorough study done. This Commission has, in fact, looked at that whole issue.

We know that here on Capitol Hill, in a quite bipartisan way, there is a lot of concern about the sharing of intelligence. Because, obviously, one of the problems deals with the sources and methods and the security. And, if you will, the trustworthiness -- not the goodness or the badness, but the trustworthiness of some of the people that we are in various multinational coalitions with that we have to share with -- or people are saying we ought to share with.

Talk about that for a bit. Because we are addressing that at some length in this report, and I would like to hear your views on that just from the point of view of the risks involved versus the advantages.

DR. HAASS: I am not going to give you a satisfying answer, because the mere fact that you are struggling with that, in some ways, gives away the bottom line. It is a dilemma. You are going to want to lean forward in order to empower these organizations, countries, coalitions, what have you. But there is no way to lean forward in the intelligence realm and empower them without undergoing some risk. They could compromise the information, the fact that it is known, or they could compromise something about sources and methods.

The only way I know of finessing that -- I will not say solving it, but managing it or finessing it -- is, to the extent possible, to separate the origin of the information from the information itself. I cannot imagine any need that most of these recipients have to know how the information was acquired. They need only the information itself or some form of the information that would perhaps blur when and how it was acquired.

We have to think hard about the timeliness question. Do they really need to know it right away, or could they learn it after some time? One is going to end up with gradations. And, to some extent, it is going to have to be very ad hoc, because lots of the situations we are going to be in are not going to be with NATO. They are going to be with Desert Storm-like coalitions or a handful of countries, as was the case in Somalia, to take the case you looked at.

So my guess is it is going to have to be extremely informal, and we are going to have to learn who we can trust. For example, looking at the United Nations, we may learn that certain individuals or agencies within the United Nations -- maybe those who are doing certain work in the nuclear realm -- we might learn we are more comfortable sharing with them than with others.

So I think it is going to be awfully case-by-case.

VICE CHAIRMAN RUDMAN: I think I can say without revealing anything that is not publicly or generally known, but probably not studied too much by too many people, that one of the problems the United States Intelligence Community ran into as far as the United Nations operation was concerned, as I am sure you know, was total lack of comprehension of all of the parameters that surround intelligence -- how it is gathered, how it is disseminated, how it is disguised, how it is communicated -- and some things happened, which are classified, which were not good.

So I think what you are saying is that those are risks that we must take in this new world, but we have to do all we can to minimize them. I guess that is what you are saying?

DR. HAASS: Like I said, it was not going to be a terribly satisfying answer.

VICE CHAIRMAN RUDMAN: Yes. Well, it is not a very satisfying question.


DR. HAASS: That is not for me to say, sir.


DR. HAASS: But I think it is part of the larger, post-Cold War American foreign policy dilemma. As we move away from unilateral actions, as we move away from fixed alliances with a number of countries who we have these developed relationships with, as we do all the things that, in a sense, are going to limit our exposure in the world -- which I think is going to be politically necessary -- we are going to have to come up with new ways of doing things.

Intelligence then becomes one of those tools that we can use, if you will, to have influence at the same time we limit some of our direct involvement. And, as a result, we are going to have to expose that tool in ways that we never had to before. And I think we are simply going to have to find our way as we go through that.

VICE CHAIRMAN RUDMAN: Let me ask you a second and a very brief question in the area of economic intelligence. Without getting into the general identities of people, were there any people on your task force who believed that U.S. intelligence should be used for the benefit of private corporations in not just a defensive way, but in an offensive way?

DR. HAASS: People came awfully close to thinking that it ought to, particularly people from the business community.

VICE CHAIRMAN RUDMAN: That is what I am really talking about.

DR. HAASS: It was one of the surprises for people such as myself, whose career is more governmental or academic. But it bordered on what I would almost call a neo-mercantilist approach, in which intelligence became a tool of American corporate activity.

It always struck me as ironic that those who had access to intelligence throughout their careers were more skeptical. And those who had not had access seemed to think intelligence was this great treasure that, if only they had more, their profit lines would go up.

VICE CHAIRMAN RUDMAN: I think there is probably unanimity on this panel on that narrow part of that subject, that that is a slippery slope.

DR. HAASS: And people also recognize that it is harder and harder to say what an American firm is nowadays and so forth.


CHAIRMAN BROWN: Well, it is worse than a slippery slope. It is a ravine.


VICE CHAIRMAN RUDMAN: Thank you, Mr. Chairman.

CHAIRMAN BROWN: Yes, Mr. Harrington.

MR. HARRINGTON: Mr. Haass, did your working group consider the mundane question of whether or not the amount of the defense budget -- I mean of the intelligence budget -- and to what extent it might be made public?

DR. HAASS: We did consider the question of public knowledge of the budget. Generally, we came out thinking that the overall number could probably be made public. Possibly, several subsidiary numbers could be made public, but not too many. And we are back to slippery slopes and possibly ravines again.

And I think the general feeling was that while people seem to want that information, the bottom lines, it is not clear that it does them an awful lot of good to know that the intelligence community, overall, spends $30 billion, $27 billion, whatever the latest numbers are. I am not sure that necessarily helps you a lot.

On the other hand, it does give you some scale of effort. And I think people felt that those kinds of broad numbers could probably be safely let out. The question was where and, more importantly, how you hold the line once you had begun that process.

I remember a conversation I had with Les Aspin on this right when we were beginning our effort and you were all beginning the effort here. A journalist came up to him and asked him the same question. And he said, Oh, I would have no problem with agreeing to the overall number. And then the journalist said, Well, what about the next number, and what about the next? And Les said, Gee, if I knew you were going to ask me those questions, I probably would not have agreed to the first. And I think that is the concern of people with this.


Mr. Friedman.

MR. FRIEDMAN: Yes, Dr. Haass, the NIC, there has been a model that has been discussed that I would just like to briefly sketch and get your reactions to or any alternatives that you think.

One approach that has been talked about is physically moving it away from the CIA and the nexus to humint -- pick your street in Washington -- keeping it -- slimming down, continuing to slim down the NIE functions, staffing it with a heavy rotational bias and a heavy bias towards using a large number of academics, also having rotational people from the DI, increasing -- trying to continue the increase in using open source information, using the Rolodexes and the know-how, the connections within the academic and think tank community of these scholars to avail yourself of thinking on those subjects that come up just out of the blue.

Keeping it small and concentrating on estimate of intelligence and having the much larger DI concentrate on current intelligence. But perhaps having this revamped NIC serve some quality control function, in terms of alerting the DCI to areas in which there may be need for competitive intelligence, things that may be falling between the slats are being politicized.

I just would be interested in your comments on this or, to the extent you do not like this, any model you do like better.

DR. HAASS: I am going to try to answer it this way, and, if I fail, come at me again. My enthusiasm for estimates is finite. By and large, I am not sure that they are particularly well read. I am not sure that they drive a lot of trains. I am not sure that that is the Intelligence Community's comparative advantage, particularly as they look out many years. That is where, by and large, secrets tend to be less critical. The longer and larger the horizons, the less significant any available secrets are likely to be, in my experience.

So an organization that has a large part of its function tied to estimates is not an organization that I therefore see a great amount of work for. I tend to lean much more towards current intelligence. I do not mind people looking out, but I think, then, it ought to be much more individuals, rather than large, coordinated processes.

Having a staff of permanent people in those kinds of jobs -- coming back to something you suggested -- is probably not as good as having an awful lot of mobility. Coming back to something that I know you care about, the idea of improving analysis would benefit from having people involved who do worry about day-to-day questions, and maybe taking a step back, doing a short stint there. Analysis would also benefit from bringing in people from the outside.

I think the NIC has become too much of a permanent institution, a permanent assignment, rather than something that has a much greater turnover. Maybe people would come just for one project. To make it more tactical or flexible might be the best.

MR. FRIEDMAN: Thank you.


Mr. Goss.

MR. GOSS: Thank you very much.

Dr. Haass, I must say that I was intrigued by your testimony, and I just have to ask you this question. A third area of possible reform involves Congress, which might consider normalizing membership in the intelligence committees. I have just got to know what your view of normalizing membership is. I think several people will be interested, actually.

DR. HAASS: No disrespect intended, let me make that clear.


DR. HAASS: What I meant to get at there was the idea that this is a committee where you have special rules about duration of membership and rotation and so forth. I do not see why that should be the case anymore. This is not an experiment anymore. This has now become like everything else. I do not see where the intelligence committees ought to be necessarily different from the foreign affairs committees or the armed services committees or the appropriations committees.

There are certain reforms that all these committees could perhaps undergo. One thing I would like to see, speaking as a former executive branch official, is merging committees for hearings so you do not have to give the same testimony four times.

But I think the idea that somehow congressional involvement in this area is an exception -- and you have these things called special select committees -- I think that actually sends out the wrong signal. But it is a close call. There is a value in rotation of members, because then you spread through the body some expertise. On the other hand, it is the old tradeoff of breadth and depth. I think we are wrong to deny ourselves the sort of value that would come from depth, from having someone be on this committee for several terms, and without a necessary artificial limit. If that is where the interest is, if that is where the expertise is, I do not think we ought to say arbitrarily this person can no longer serve on this committee.

I know that puts me at odds with term limits, but I will take that risk.


MR. GOSS: I expected that was your answer. And I think it is a good answer. And I think that we have, in fact, tried to get into this. Because there is a broader and deeper question involved in my first question, and you alluded to it. You alluded to it, through this Commission, as bringing the executive and the legislative together.

In fact, the separation of powers concept tries to keep us apart so that we do oversight, and we do it in a pure form. And presumably there is no contamination on either side if we do things that way.

The fact of the matter is, when you come to intelligence, it is supposed to be nonpartisan -- or bipartisan, however we phrase that -- and when you come to national security, that really does not talk about a lot of separation of power. That really -- we can talk about the War Powers Act, I suppose, if we want to get into that kind of a thing.

But what we are talking about -- what we are really interested in are threats to the well-being of Americans and American interests and Americans overseas. It seems to me it is a pretty straightforward trail we are all going down, with as much honor and cooperation as we possibly can.

We have talked about a joint committee, and we have talked about, in fact, in Congress, some discussion about going to a regular standing committee and getting away from the select process. And I think that the predominant feeling still today is that we should maintain the separation of powers for the oversight role that is played, and that we should probably remember that the sensitivity of the material that we handle on the committee does warrant probably some kind of a special attention, which we call a select committee.

But I think your observations are right to have been raised, and I am glad you did. Because I know many others have, including myself. But I think that is a question where the answer may not always be the same as we go along, as things change here.

Thank you, Mr. Chairman.

CHAIRMAN BROWN: Thank you, Mr. Goss.

Anyone else?

Senator Exon.

SENATOR EXON: Mr. Chairman, if you would let me make a few brief remarks with regards to the excellent work that I think you members of the group have done. I unfortunately cannot control my time here. And obviously, again today, when I would have liked to have spent more time with you, other things do interfere with it.

I have followed very closely the hearing through Andy Johnson, my staff person, who has been at all of the meetings. He has kept me fully posted.

I want to compliment you, Mr. Chairman, and my former colleague in the United States Senate, and before him, Les Aspin, for being excellent leaders in this field. I am anxious to move forward in implementing the recommendations that will finally be made by the Commission. And from the review that I have made of the information given to me by Mr. Johnson, I think you are exactly on track. And I have served on other committees, usually being more involved than I have been on this one -- unfortunately not possible because of my other duties.

I just think your whole approach to this has been extremely professional, and a lot of good is going to come out of this because of your dedication, of which I have not been as much a part as I would like to have been. So, from a member of the Commission that has not been as active as I would like to have been, I say thank you for an excellent effort. And all of you who have put in so very much time on this are to be congratulated for the sacrifice of your time and your talents to this very, very important matter.

I only have a question or two of the current witness, who is particularly interesting because of his long service on the National Security Council primarily, and elsewhere. I noticed in your testimony you say there are still important but hard to learn facts about targets, including the intentions and capabilities of rogue states and terrorists and so forth and so on.

I happen to feel, and I suppose you have talked about this when I was not here today, but I happen to feel that the intelligence-gathering services probably are under more of a strain, particularly with regard to terrorist activities, which I am fearful is going to require a great deal more intelligence in the field that probably we have not been as much involved in as we are going to have to be in the future as a result of the Cold War coming to an end.

I would say that as a consumer of much of this information and as a senior member of the Armed Services Committee, in looking back at some of the information that we received, especially with regard to the economic situation in the Soviet Union, was far from what I think the facts were at the time. I also noticed in your testimony that you indirectly touch on some of these things by talking about things, making sure that the collector of intelligence information does not become the purveyor of information to the political structure, to have them hear what they would like to hear.

And I unfortunately think that, you know, not by design, but maybe by just the process that we were using at the time, that we were not getting all of the -- I felt much better, frankly, in looking back, about the hard information that we had on intelligent matters. I mean, I want to be a little bit guarded, but I mean what we knew as to where the key people were and what they were doing and so forth and so on. I thought we had good intelligence on that.

I never thought, looking back, that we had very good intelligence with regard to the economic difficulties that do play in a situation as to guarding the -- trying to guard the information that we have and assess it, as to what we are going to be doing in the future.

I happen to feel -- and I would maybe, before I ask the witness to comment on this, to have probably some comment to bring me up to date by Mr. Brown and Mr. Rudman with regards to whether or not you think we have done an adequate job. Or should we be doing more with regard to the collection of and disposition of the information with regard to terrorists, which I think is a tremendously important challenge to the Intelligence Community.

CHAIRMAN BROWN: Well, it is something that we have looked at. It is a very tough nut to crack in many cases. The priority has certainly been greatly increased. Success has been mixed. And of course, the more successful you are, the less you tend to say about it.

I think we have a ways to go.

VICE CHAIRMAN RUDMAN: I would agree with that. And, frankly, I think that the whole area of intelligence on terrorism is really a fledgling activity, even though we have been at it for a while. It is certainly not at the level of maturity as doing a study of order of battle from a particular country and a particular region. It is not that empirical. It is very difficult.

But I do think that you will find in the final version of the report, as we are still evolving, that there will be some time devoted to improving collection generally.

SENATOR EXON: How do you feel about all this, Mr. Haass? Given your past experience, I am sure that terrorist-type of activities were something that you were briefed on from time to time. But do you agree that this is an important new challenge -- probably the most difficult one -- for the Intelligence Community?

DR. HAASS: Senator, it is on anyone's short list, not simply of ongoing foreign policy problems, but one of those problems where intelligence can possibly make a unique contribution. We are not going to learn about terrorists on the Internet. We are not going to learn about terrorists on CNN until it is too late.

So if there is a chance of learning about them, it is probably going to come from intelligence sources -- most likely human sources -- and not from satellites. And if there is a chance of doing anything about them, it is going to be, I think, largely through covert methods.

It is part and parcel of a larger phenomenon in the post-Cold War world, where we are not going to have the luxury of focusing so much on a much more conventional, traditional threat called the Soviet Union, and we are going to have to focus much more on a number of very different kinds of threats. Terrorism is obviously high on that list.

And I would think that when you look out over the next 5, 10, 15 years, and consider a reorientation of resources within the intelligence budget, that is one of the pots that is going to receive more rather than less. It is also one of the reasons that you are unlikely, when all is said and done, to have some large peace dividend in this area. There are just going to be new requirements, like terrorism, that are going to come along, and they are not going to be inexpensive to deal with.

SENATOR EXON: I notice in your prepared material that you did have some comment about the necessity of human sources. You also said in your testimony that when you get into human sources, not uncommonly, you find yourself very close to some unsavory characters. But I suspect that the unsavory characters are the ones that we are likely going to have to go to, to depend on getting some information that could probably come through no other source, including ones that you have mentioned.

DR. HAASS: The sorts of people who would join the organization, such as terrorist cells that you are talking about, are unlikely to be paid-up members of the Boy Scouts. And I think part of the debate that we began to have publicly in this country several months ago -- the controversy about Guatemala and so forth -- was just the tip of the iceberg.

And I think it raised, more than illuminated, shall we say, some of the difficult choices that we are going to have to make about what are going to be the ground rules or guidelines for associations with these people. Because if we deny ourselves that flexibility, if we say we are not going to associate with these people who have committed human rights crimes or what have you, we are also going to deny ourselves access to the very people who either are going to commit terrorism or going to be in a position to know about terrorists and other sorts of concerns of ours.

SENATOR EXON: I guess what you are saying is, if I were placed in the position where I was the one seeking that kind of information, I would have to associate with someone like Warren Rudman, whether I wanted to or not?


SENATOR EXON: Is that the message you are trying to deliver here?


DR. HAASS: That is senatorial privilege I think, which I do not enjoy.

SENATOR EXON: Mr. Chairman, thank you very much.

And I thank the witness.


VICE CHAIRMAN RUDMAN: I want to just say one other thing to the witness before he leaves. You made an interesting comment about an ongoing process here. You should be aware -- and I guess this is a good time to say it -- and the Commission has said this before, but it has not got much publicity -- we intend not only just to issue a report -- there will be a legislative package and there will be a package involving executive orders. I mean, we are going to tell people what we think they ought to do and how they ought to do it. And then, of course, the Congress will decide, along with the Administration, what they will do.

So we intend to really put it together, in terms of what recommendations we do make. So they simply do not drift off, waiting for someone to put something together. And we will do that.

DR. HAASS: I think that is great. My only concern was, with what you were saying, and with a very energetic gentleman who is currently the DCI, and with two very active and involved congressional committees, and with the inevitable differences that are going to arise among the various centers of power and influence here, that all this did not result in some sort of gridlock and necessary things did not happen.

And I am just hoping that -- I realize you do not want to necessarily make this a career -- that there will be continuing effort to work with Senator Specter, with Congressman Combest, with others, so the inevitable differences do not get in the way of what I hope are the common areas, where people do agree that reform can and should be made.

CHAIRMAN BROWN: I think you can count on a continued interest on the part of many of us. I do not think that it is feasible to set up some group that becomes the referee. You know better than that.

Thank you very much for your thought and the use of your experience. I think it has been very helpful.

Thank you.

DR. HAASS: Thank you.