holdover bureaucrats satisfied by the status quo, the Technical Advisory Group proposed instead that the President create something entirely new-a small, agile, elite organization with the President's personal support, dedicated wholly and single-mindedly to conducting fusion analysis.

This organization would draw upon all the information available to the federal government and use the resulting knowledge to achieve a single clear goal-dismantling and destroying terrorist groups that threaten the U.S. This, they hope, might allow meaningful reform to take place without initially having to upset entrenched bureaucratic apple carts.

They proposed, in effect, an intelligence-related version of the Manhattan Project that would take place, to some extent, outside the traditional chains of command and networks of vested interests. They suggested an approach modeled on the movie catch phrase, "If you build it, they will come." If this new venture were successful, its progress would breed further successes by gradually attracting resources and support from elsewhere, and perhaps by stimulating the intelligence bureaucracies to do more to reform themselves when faced with the success of an alternative model.

I was struck the other day, Mr. Chairman, during our hearing on information-sharing by the degree to which Governor Gilmore and our DIA witness, Mr. Andre, both echoed themes emphasized by the TAG group. They described the need for a single, all-source intelligence fusion center equipped with the latest analytical and data-mining tools and authorized to apply these tools against the whole spectrum of agency databases, even to the point of accessing so-called raw data.

I think these ideas are very much on the right track. I hope, therefore, Mr. Chairman, that these two Committees, ours and the House, in considering all the proposals for intelligence reform that have been made in recent years, will also give serious consideration to the excellent work of our TAG group and the valuable advice of some of our witnesses.

Thank you, Mr. Chairman.

Chairman GRAHAM. Thank you very much, Senator, for a very thoughtful statement. And I particularly appreciate the recognition you've given to the outstanding work of our Technical Advisory Group and the contributions which I think their ideas, as well as the witnesses that we have and will hear, will make towards our final recommendations to the American people, to the administration and to our colleagues in the Congress.

Vice Chairman SHELBY. Thank you, Mr. Chairman.

1

Joint Inquiry Staff Statement

Proposals for Reform within the Intelligence Community

Eleanor Hill, Director, Joint Inquiry Staff
October 3, 2002

Introduction

Mr. Chairman and members of the Joint Inquiry Committee, good morning. In prior hearings, we have discussed specific factual issues and systemic problems that relate to the U.S. Government's performance regarding the events of September 11t. These have included analytical, information sharing, budgetary, and cultural issues. Today's hearing moves beyond the factual record that has been established to look toward the future and the need for reform within the Intelligence Community. Specifically, today's testimony will focus on how the Community could and should be changed to strengthen and improve the ability of the U.S. government to counter terrorist threats.

In 1947. Congress passed the National Security Act. This Act established the statutory framework for the United States Intelligence Community, including the Central Intelligence Agency (CIA) and the Director of Central Intelligence (DCI). The Act also created a semi-unified military command structure under a Secretary of Defense, and a National Security Council to advise the President.

Since then, many new organizations have been created and their missions defined in a variety of laws. executive orders, regulations and policies. During this fifty-five year period, numerous independent commissions, experts, and legislative initiatives have examined the growth and evolving mission of the Intelligence Community. Many proposals have been made to address perceived shortcomings in the Intelligence Community's structure, management, role. and mission. These have ranged from a fundamental restructuring of the Intelligence Community to tinkering with its component parts.

The earliest studies of the Intelligence Community addressed questions of efficiency and effectiveness. They included the first and second Hoover Commissions to review the Organization of the Executive Branch of the Government in 1949 and 1955; the 1949 Dulles-Jackson-Correa Report of the Intelligence Survey Group that was established to evaluate the CIA and its relationship with other agencies; and the 1975 Commission on the Organization of the Government for the Conduct of Foreign Policy, known as the Murphy Commission. The reviews and investigations of the 1970s and 1980s -- the most prominent of which were the Rockefeller Commission on CIA activities within the United States, the Senate and House Investigating Committees led by Senator Frank Church and Congressman Otis Pike, and the Iran-Contra Committees -dealt with issues of legality and propriety. They also addressed, in varying degrees, the fundamental operating principles of the Intelligence Community.

With the end of the Cold War, both the executive and legislative branches chartered numerous additional studies to examine a variety of issues, including:

Intelligence Community capabilities, management, and structure:

Extent and competence of U.S. counterintelligence:

Managerial structure of armed services and DOD intelligence components:
DCI roles. responsibilities, authorities, and status:

Allocation of personnel and financial resources:

Duplication of effort within the Intelligence Community:

Expanded use of open source intelligence: and

Need for covert action capability.

Since the end of the Cold War in the early 1990's, the pace of reviews and studies relating to the Intelligence Community has markedly increased. The more prominent of these have included:

1995-1996: Commission on the Roles and Capabilities of the U.S. Intelligence Community (Aspin-Brown Commission)

1996: IC21: The Intelligence Community in the 21" Century (House Permanent Select Committee on Intelligence Staff Study)

1997: Modernizing Intelligence: Structure and Change for the 21" Century (Odom Study)

1998: Intelligence Community Performance on the Indian Nuclear Test (Jeremiah Report)

· 1999: The Rumsfeld Commission on the Ballistic Missile Threat

2000: Countering the Changing Threat of International Terrorism, a report from

the National Commission on Terrorism (Bremer Commission)

2000: Report of the National Commission for the Review of the National
Reconnaissance Office

2000: National Imagery and Mapping Agency Commission Report

2001: Road Map for National Security: Imperative for Change. The Phase III Report of the U.S. Commission on National Security/21" Century (Hart

Rudman Commission)

2001: The Advisory Panel to Assess Domestic Response Capabilities to Terrorism Involving Weapons of Mass Destruction (Gilmore Commission) (Third

Annual Report)

· 2001: Deutch Commission on Weapons of Mass Destruction

2002: A Review of Federal Bureau of Investigation Security Programs, (Webster Commission)

· 2002: HPSCI Subcommittee on Terrorism Study

These reviews varied in the areas they examined and emphasized different issues in their reports. However, the reports identified several areas where improvement was needed, including:

Development of a strong national security strategy;

· Information sharing with other federal agencies and with state and local

Additional resources for analysts and linguists: and

Restructuring the distribution of responsibilities and authorities between the
DCI and the Secretary of Defense.

For today's hearing, we have asked the witnesses to discuss these and other issues of authority and organization in the context of the findings and recommendations of these reports. More important, we have also asked them to suggest and discuss proposals for reform that might be appropriate in light of the performance of the Intelligence Community regarding the September 11 attacks. Their testimony will, we expect, include a discussion of the role and responsibilities of the DCI. the Secretary of Defense, the law enforcement community, and the proposed Department of Homeland Security in supporting or implementing counterterrorism and domestic intelligence programs. Finally, we have solicited their thoughts on the establishment of a domestic intelligence organization and the question of to what extent such an organization could raise concerns regarding the preservation of civil liberties.

As a prelude to this morning's testimony, I would like to provide a very brief overview of a few of the previous reports on these topics and describe several common issues and themes that are of particular relevance to this Joint Inquiry.

The 1995-1996 Commission on the Roles and Capabilities of the U.S. Intelligence Community, commonly referred to as the Aspin-Brown Commission, included the following among its key findings:

• Intelligence agencies must be integrated more closely with the law enforcement community;

· Intelligence agencies must function more closely as a "Community”—there was insufficient central authority and too many administrative barriers that impeded cooperation;

⚫. The process for allocating resources to intelligence agencies was severely
flawed-workforces were not aligned to needs, multiple personnel and
administrative systems were inefficient, and modern management practices
needed to be utilized; and

• The confidence of the public in intelligence matters needed to be restored.

In 1996, the House Permanent Select Committee on Intelligence conducted a review of the Intelligence Community and published a staff study entitled, "IC21: The Intelligence Community in the 21" Century." Its key findings included:

• The Intelligence Community would benefit greatly from a more corporate approach to its basic functions, e.g., stronger central management, reinforced core