BEFORE THE SENATE SELECT COMMITTEE ON INTELLIGENCE

HEARING ON CURRENT AND PROJECTED NATIONAL SECURITY THREATS 

“Turning now to terrorism, Mr. Chairman, I must stress that the threat to US interests and citizens worldwide remains high. Even though the number of international terrorist incidents in 1997 was about the same as 1996, US citizens and facilities suffered more than 30 percent of the total number of terrorist attacks--up from 25 percent last year.

Moreover, there has been a trend toward increasing lethality of attacks, especially against civilian targets. The most recent examples, of course, are the suicide bombings in Israel in 1996 and 1997 and the

attacks on tourists in Luxor, Egypt last November. Perhaps most worrisome, we have seen in the last year growing indications of terrorist interest in acquiring chemical, biological, and nuclear weapons.

In addition, a confluence of recent developments increases the risk that individuals or groups will attack US interests. Terrorist passions have probably been inflamed by events ranging from the US Government's designation of 30 terrorist groups to the conviction and sentencing of Mir Aimal Kasi and Ramzi Ahmed Yosuf as well as the ongoing US standoff with Iraq and frustration with the Middle East peace process.

Among specific countries, Iran remains a major concern, despite the election of a more moderate president. Since President Khatami assumed office in August, Iran has continued to engage in activities, such as support for Hizballah and its Palestinian clients, that would not require his specific approval.

Iraq, Sudan, and Libya also bear continued watching, both for their own activities and for their support of terrorist organizations.

Mr. Chairman, I would like now to turn to states for whom the end of the

Cold War did not mean an end to hostility to the United States.

Among these countries, Iran in many respects represents the greatest challenge we will face over the next year. It appears to us that a genuine struggle is now underway between hardline conservatives and more moderate elements represented by Iran's new President Khatami. And so the challenge is how to cope with a still dangerous state in which some positive changes may be taking place--changes that could, and I stress could--lead to a less confrontational stance toward the United States.

Khatami's strongest card is his electoral mandate - - a 70 percent vote representing mostly youth and women, as well as ethnic and religious minorities in Iran. Since assuming office in August, he has made limited but real progress toward fulfilling his campaign pledges for political and social reforms.

·He gained approval for a new cabinet that puts his people in key posts such as the ministries of Foreign Affairs, Interior, and Islamic Culture.

·Censorship is now less oppressive, with previously banned periodicals reappearing and socially controversial films being shown.

·And against this backdrop, there is even renewed debate about a central tenet of the revolution - - rule by a supreme religious leader.

Progress is likely to be fitful, however, and hard-line elements remain formidable obstacles.

·They still control the country's defense and security organizations, for example, and therefore exert heavy influence on issues most vital to the United States.

Statements by Khatami and his foreign ministry suggest he is trying to play a more constructive role in the international community. It is simply too early to tell , however, whether this will lead to demonstrable changes in Iranian policies that matter most to the United States. We have seen no reduction in Iran's efforts to support Hizballah, radical Palestinians, and militant Islamic groups that engage in terrorism.

Moreover, even as it attempts to improve its international image, Tehran is continuing to bolster its military capabilities. Iran is improving its ability potentially to interdict the flow of oil through the Strait of Hormuz. It has acquired Kilo-class submarines from Russia and is upgrading its antiship-missile capabilities.

·And, as I noted earlier, Iran continues its efforts to acquire the capability to produce and deliver weapons of mass destruction.

Mr. Chairman, Iraq, under Saddam, continues to present a serious threat to US forces, interests and allies. Our principal aim must be to ensure that Saddam does not have weapons of mass destruction or the capacity to regain any he has lost. As my statement for the record points out in greater detail, we assess that Iraq continues to hide critical WMD production equipment and material from UN inspectors.

·Continued UN sanctions can keep pressure on his regime and cast uncertainty over Saddam's hold on power.

·But, as you know Mr. Chairman, Saddam is pushing more aggressively than last year to erode the sanctions regime.

More than seven years of sanctions have had a devastating effect on Iraq's economy. Inflation is soaring, the civilian infrastructure is deteriorating, and the Iraqi population continues to suffer from high rates of malnutrition and inadequate services-- in part because of Saddam's manipulation of relief supplies. Key regime officials and support organizations remain largely immune to the harsh living conditions facing the general population and even live off revenues generated through illicit trade--a fact that engenders resentment and poses an underlying threat to Saddam and his family.

While its military forces continue to slowly deteriorate under UN sanctions and the arms embargo implemented after the Gulf War, Iraq remains an abiding threat to internal oppositionists and smaller regional neighbors.

Mr. Chairman, I propose again this year to provide you a brief description of where we stand in several potential "hot spots." As I did last year, I will focus on the situation in the Middle East, South Asia, and Bosnia.

·With regard to the Middle East, Mr. Chairman, my bottom line message must be that the region is more volatile and more troubled than when I testified here last year. Many of the threats I have discussed today intersect in the Middle East, where the historic strife and distrust that mark the region are now aggravated by the spread of sophisticated weapons programs, an upsurge in terrorism, and demographic trends that point to heightened social tensions.

·Against this backdrop, the peace process has foundered, with dangerous implications for all of the parties.

·Iraq, as noted earlier, continues to defy the international community's effort to deny it the means to again commit aggression.

·And some of the fixed points have begun to change, Iran in particular,

but not so conclusively as to permit a dropping of our guard.

·Meanwhile, world demand for imported energy will ensure the region's strategic importance, along with the active, and sometimes competitive, engagement of many nations.

In short, Mr. Chairman the period ahead is one of enormous challenge for the United States as it seeks to ensure stability, prosperity, and peace in this most critical of regions. “

George J. Tenet, CIA Director"

Throughout history, the leaders of nations and armies have sought to be forewarned of dangers and forearmed with information that reduces uncertainty and provides a critical edge for decisions. The effort to meet these fundamental needs of decision-makers is what lies behind the practice of intelligence. That practice consists of collecting and interpreting information, overcoming in the process any barriers erected to keep secret the ac, capabilities, and plof foreign powers and organizations.

Today, intelligence is a vital element in every substantial international activity of the US government. Every day, the agencies and offices that make up the US Intelligence Community provide an important information advantage to those who manage the nation's strategic interests--political, economic, and military. Intelligence organizations support a broad range of consumers, from the national level of the President, the Cabinet, and the Congress, to the tactical level of military forces deployed in the field.

For intelligence officers, this means maintaining an ability to warn policy makers and military leaders of impending crises, especially those that threaten the immediate interests of the nation or the well-being of US citizens. It also means giving government and military officials advance knowledge of long-term dangers, such as the threats posed by countries that covet weapons of mass destruction. It means helping to safeguard public security by countering threats from terrorists and drug traffickers. It means supporting economic security by uncovering foreign efforts at bribery and other schemes to tilt the playing field of international trade. And it means multiplying the effectiveness of US military forces deployed for operations.

A series of statutes and Executive Orders provides legal authority for the conduct of intelligence activities. Key documents include the National Security Act of 1947 (as amended), which provides the basic organization of the US's national security effort, and Executive Order 12333, which provides current guidelines for the conduct of intelligence activities and the composition of the Intelligence Community. Together with other laws and orders, these two documents are meant to ensure that intelligence activities are conducted effectively and conform to the US Constitution and US laws. They also provide a statutory basis of accountability to the Congress.

The national intelligence effort is led by the Director of Central Intelligence (DCI), who oversees the Intelligence Community organizations described in more detail in the following pages. Resources for these organizations are tied together in the National Foreign Intelligence Program--the budget for these national activities, which support political, economic, and military decision makers, is developed by the DCI and presented to the Congress annually. Intelligence activities that are more narrowly focused and intended to support tactical military forces are funded separately in two programs within the Department of Defense. These programs--the Joint Military Intelligence Program and the Tactical Intelligence and Related aggregation--fall under the aegis of the Deputy Secretary of Defense. In recent years, the line between national and tactical activities has become less distinct and, in fact, national and tactical capabilities have been brought to bear on intelligence problems in complementary ways. The goal of intelligence, however, has remained constant--to support decision-makers with the best possible information, no matter its source.

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