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29 January 1998
Source: Hardcopy The New York Times, January 29, 1998, p. A3

## U.S. Spy Agencies Find Scant Peril on Horizon

> Washington's experts discern a world without an obvious enemy.

By Tim Weiner

Washington, Jan. 28 -- While the world still bristles with weapons the United States itself is relatively secure from the threat of war, the Government's top intelligence officials testified today.

The nation confronts dangers to world peace, personified by President Saddam Hussein of Iraq, and a Pandora's box of potential threats, exemplified by the spread of nuclear, biological and chemical weapons, the intelligence experts said.

But "the danger of nuclear attack, large-scale conventional attack and other threats to our national existence is low," Phyllis Oakley, the Assistant Secretary of State for intelligence and research, said in testimony before the Senate intelligence committee.

The rest of the world's nations are spending 40 percent less on their armies and on military weapons than they did a decade ago, said Lieut. Gen. Patrick M. Hughes of the Army, director of the Defense Intelligence Agency. And no well-armed, technologically advanced nation is likely to make war on the United States in the foreseeable future, he said.

The witnesses, especially George J. Tenet, the Director of Central Intelligence, did warn the Senators of a long list of problems that, left untended, could lead to war somewhere, sometime.

That list was evidence of the unsettled and, for some, unsettling nature of the post-cold-war world. Few of the threats they cited could be solved by American military prowess. Many were economic, ecological, technological, political and criminal phenomena that warplanes and smart bombs cannot combat.

The intelligence chiefs, joined by Bob Bryant, the deputy director of the F.B.I., presented what has become an annual "state of the world" briefing to the Senate intelligence committee. Intelligence professionals are famously pessimistic; an old joke has it that when they smell flowers, they look for a funeral. But today's briefing left the impression that, for the time being, the United States faces no lethal threat from abroad, a state of affairs unimaginable from the 1940's through the 1980's.

Still, uncertainty and threats cloud the horizon. Mr. Tenet cited first and foremost the spread of weaponry, pointing to China's sales of military hardware to Iran and Pakistan, and Russian companies' sales of missile technology to Iran. The C.I.A. had estimated in 1996 that Iran could have medium-range missiles capable of hitting Saudi Arabia or Israel within a decade; he said today than Iran would have such missiles "much sooner."

Whether Iran would ever use those missiles is another question. The C.I.A. sees "a genuine struggle" between moderates and fundamentalists in Iran that, if resolved in the moderates' favor, "could lead to a less confrontational stance toward the United States," Mr. Tenet said.

The C.I.A. sees "hopeful signs" in its old cold-war adversary, the former Soviet Union. "Moscow cooperates with the United States and the West in ways that were unimaginable during Soviet times," Mr. Tenet said. But the fact that Russia has 6,000 nuclear warheads capable of reaching the United States remains "a major preoccupation for U.S. intelligence."

Addressing Iraq and its intentions, Mr. Tenet chose tough, confident words. He called President Hussein "a desperate man in terrible shape," whose military forces are deteriorating even as he tries to hide his biological and chemical arsenal from the world's view.

"I wouldn't want to play his deck of cards," Mr. Tenet said. "We have this man in a box, and he's going to stay in a box."

General Hughes concurred. "Iraq's military capability continues to erode," he said. "Saddam's forces have significant weaknesses -- in leadership, morale, readiness, logistics and training -- that would limit their effectiveness in combat."

Going down the list of the nation's potential enemies, the general said Russia is no more likely to attack the United States than America's allies in Europe and Asia; Iran is "likely to seek better relations" with Washington; and "North Korea's overall military readiness continues to erode." He did not even mention the possibility of an attack from China.

"The global threats facing the United States are diminished in magnitude," he concluded.

Few of the potential threats to peace mentioned by the witnesses -- poverty, pollution, disease, hunger, political disenfranchisement, drug trafficking, cultural struggles, and shortages of fresh water and arable land -- fit on a military target list.

Yet, all "bring great stress to the international order," General Hughes testified, and added, "No condition, circumstance or power is likely to emerge over the next 10 to 20 years which will somehow transcend them and lead to a more stable global order."

## Iraq Intelligence Gaps Acknowledged

January 29, 1998

Washington - The Associated Press: Even as the United States considers a possible attack against Iraq, top intelligence officials acknowledged Wednesday that there are big gaps in what they know about Iraqi chemical and biological weapons.

- The problem is particularly acute now that U.N. weapons inspections have ceased due to Iraqi refusal to allow access to sensitive sites, doubly so because U.S. military commanders may be hoping to damage Iraq's weapons capability with air strikes.

- ``There are enormous gaps in what we know about where they were in development of these weapons of mass destruction,'' said Phyllis Oakley, the State Department's chief intelligence official. ``The number of off-limits sites has been whittled down, but they're large enough that we don't know what they've moved into them, and if we can't get at them, we don't know.''

- Oakley, along with CIA Director George Tenet and Army Lt. Gen. Patrick Hughes, head of the Defense Intelligence Agency, told lawmakers that Iraq probably has little in the way of a chemical or biological arsenal but may have weapons production facilities.

- ``My personal believe is that (Saddam) has somehow protected the essential knowledge and some few capabilities that he still has at his command to continue weapons of mass destruction production at some later time,'' Hughes said in Wednesday's hearing of the Senate Intelligence Committee. ``That's why he's being so difficult with us now - to protect that core capability he's managed to conceal from us.''

- Although the three officials did not address in open session the increasing likelihood of U.S. air strikes on Iraq, their testimony underscored the difficulty of grappling through military means with Iraq's potential weapons capability.

- Defense officials have said repeatedly, if anonymously, that they are concerned that the U.S. conventional arsenal would be incapable of penetrating some of Iraq's most hardened targets, such as deeply buried bunkers that may house biological or chemical weapons labs. And the testimony Wednesday about the uncertainty over what Iraq has and where weapons or production facilities may be located suggests the Pentagon may not be able to guarantee that air strikes can destroy what U.N. weapons inspectors have yet to find.

- What is known about Iraq suggests a continued erosion of military strength. The Defense Intelligence Agency reported ``significant weaknesses'' in Iraq military readiness, leadership, morale, logistics and training. Hughes reported ``limited efforts'' by Iraq to preserve and expand missile technology and weapons of mass destruction capability. And Tenet said Iraq remains strong enough to threaten small regional neighbors and internal opposition groups.

- U.N. weapons inspections provided U.S. intelligence with a wealth of information about Iraqi capability, and led directly to the destruction of more chemical and biological weapons than were destroyed in the 1991 Persian Gulf War. But Oakley said the intelligence on what Iraq possessed before the inspections, and what may survive today, is spotty at best.

- Tenet was at pains to describe Iraq's strategic position as weakened as a result of an international trade embargo and U.S. military containment of Iraq.

- Saddam, Tenet said, ``is trying to exploit the diplomatic situation to his benefit. At the end of the day, he's a desperate man in terrible shape. ... We have this man in a box.''

- The remark prompted Sen. Bob Kerrey, D-Neb., to quip that Tenet was now qualified to be secretary of defense. It was a joking reference to the anger then-CIA Director John Deutch aroused within the Clinton administration when he testified in 1996 that Iraq had come out ahead in its most recent brush with the United States. Deutch soon found himself out of the running to become defense secretary.

- Despite Tenet's assurances that Saddam remains thoroughly contained, Oakley and Hughes said he retains enough freedom of action to repeatedly provoke Washington.

- ``It is Saddam who keeps pushing the envelope to see what he can get away with,'' Oakley said.

- ``But we react to it,'' interjected Sen. Richard Shelby, R-Ala., the committee chairman.

- ``Well, of course we do,'' Oakley said.

- Hughes struck a similar theme.

- ``Saddam Hussein has the capability to generate a crisis and there's not much we can do about that now except to respond to the crisis,'' Hughes said. ``We probably are faced with some kind of decision point in the next few months where we have to decide what we want to do with Iraq into the future.''

## FBI tells Congress encryption "is a critical problem"

Date: Wed, 28 Jan 1998 22:20:42 -0500
To: cryptography@c2.net
From: Declan McCullagh <declan@well.com>

The nation's top cops aren't happy about Americans using data-scrambling software to shield their correspondence from prying eyes. Today the deputy director of the FBI told the Senate Intelligence committee that encryption "is a critical problem" that Congress needs to solve -- presumably by banning email and other programs that his G-men can't crack.

> http://cgi.pathfinder.com/netly/opinion/0,1042,1385,00.html

Bob Bryant warned the committee that "the widespread use of robust non-key recovery encryption will ultimately devastate our ability to fight crime and prevent terrorism."

Which is precisely what Sen. Bob Kerrey (D-Neb) claims he's concerned about. He said "if we want to make the American people continue to feel safe," the National Security Agency and the FBI "have to be able to somehow deal with not just the complexity of signals, but increasingly encrypted signals that are impossible for us to break." Not surprisingly, the question of why the FBI and NSA should have the ability to listen in on any conversation was left unasked.

--By Declan McCullagh/Washington (declan@well.com)

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