Bush Panel Finds Big Flaws Remain in U.S. Spy Efforts

By SCOTT SHANE and DAVID E. SANGER

New York Times

April 1, 2005

WASHINGTON, March 31 - In a scorching assessment of chronic dysfunction inside American intelligence agencies, a presidential commission told President Bush on Thursday that the underlying causes of the failure to have understood Iraq's weapons programs "are still all too common." It also warned that the United States "knows disturbingly little about the nuclear programs of many of the world's most dangerous actors."

In the bluntly worded, 601-page report, the nine-member commission flatly stated that harm done to American credibility because of the Iraq failure would take "years to undo." It also warned of specific new vulnerabilities, especially in understanding the spread of biological weapons programs.

Even before John D. Negroponte begins his confirmation hearings as the first director of national intelligence, it urges him to undertake a radical reorganization of many of the nation's 15 intelligence agencies to end for good the long-running turf wars that have divided them. It also calls on him to encourage a culture that challenges assumptions before they turn into accepted wisdom, as they did about Iraq in the prelude to the American-led invasion.

The commission, headed by Judge Laurence H. Silberman and former Senator Charles S. Robb of Virginia, noted acidly that despite several previous investigations lambasting deep flaws in the intelligence services, they have "an almost perfect record of resisting external recommendations."

In its opening letter to Mr. Bush, it called the spy agencies "headstrong," and in a clear reference to Mr. Negroponte, it warned: "Sooner or later, they will try to run around - or over - the D.N.I. Then, only your determined backing will convince them that we cannot return to the old ways."

The breadth and detail of the indictment, written in vivid, colloquial language rare in Washington, went beyond previous critiques. The report was particularly blistering about the low quality of the "President's Daily Brief," the morning intelligence review that once was deemed the gold standard of American intelligence.

Mr. Bush had resisted turning over such briefing documents to the 9/11 commission that reported its findings last year. He did provide them to this panel, which operated under a far greater cloak of secrecy.

Without revealing details of the briefs on Iraq, this commission concluded that the briefs were even "more alarmist and less nuanced" than the far more detailed 2002 National Intelligence Estimate on Iraq's weapons. The panel concluded that the intelligence estimate, intended to be the government's most authoritative analysis of the Iraqi threat, was "dead wrong."

Mr. Bush met with the full commission for more than an hour Thursday morning, and emerged to declare that "we will correct what needs to be fixed, and build on what the commission calls solid intelligence successes."

He was referring to a case study singled out by the commission that praised the intelligence agencies' discovery of Libya's nuclear program, in large part by piercing the nuclear black market network run by the Pakistani scientist Abdul Qadeer Khan. Two months after a ship bearing nuclear centrifuge parts to Tripoli was intercepted on the high seas, Libya agreed to dismantle its nuclear program.

But the commission, formally called the Commission on the Intelligence Capabilities of the United States Regarding Weapons of Mass Destruction, described that success as a rarity that intelligence agencies are "not well-postured to replicate."

"They're still, in some respects, fighting the last war," Mr. Robb said, noting how many times outside studies have called for the intelligence agencies to adapt to a very different world of threats, and how steadfastly they have resisted change.

Though much of the report concentrates on how the Central Intelligence Agency, the Defense Intelligence Agency and other corners of the intelligence world exaggerated the threat posed by Iraq before the American-led invasion, Mr. Bush took a very different view of its main message. He put his emphasis on the opposite problem: the hazard of missing or underestimating threats "in a dangerous new century."

"Our collection and analysis of intelligence will never be perfect, but in an age where our margin for error is getting smaller, in an age in which we are at war, the consequences of underestimating a threat could be tens of thousands of innocent lives," Mr. Bush said. "And my administration will continue to make intelligence reforms that will allow us to identify threats before they fully emerge so we can take effective action to protect the American people."

The president, however, never discussed how the overestimation of Iraq's threat contributed to his decision to go to war, and the commission - citing the mandate he gave it more than a year ago, when the White House feared that the issue could affect the election - never delved into that issue.

George J. Tenet, who was director of central intelligence from 1997 until last summer, released a statement on Thursday defending his record. "I wish the commission had spent more time reflecting on how far the intelligence community has come in rebuilding American intelligence," he wrote.

Mr. Tenet said that by the late 1990's, budget cuts had left the agencies "nearly in Chapter 11." He added that "we put in place a deliberate program to rebuild capabilities and recruit a modern work force," changes that were still in progress when the Iraq assessment was undertaken.

Deleted from the commission's public report were 91 additional pages that appear in a classified version, mostly a discussion of the nuclear programs in Iran and North Korea, and of covert operations. According to officials who have reviewed the commission's 11 specific findings about those two nations, which Judge Silberman and Mr. Robb declined to discuss even in general terms, the classified version includes a review of the parallel pitfalls that could affect judgments of how many nuclear weapons North Korea has built, or how long it will be until Iran can manufacture its own uranium weapons.

The nature of intelligence about Iraq differed greatly from what is known about the nuclear programs in Iran and North Korea. But when asked whether the current assessments of those two countries suffer from the same problem the commission said had plagued the Iraq analysis - an assumption that because a country is caught buying illicit goods, it knows how to assemble them - Mr. Robb would say only, "We found systemic problems throughout the community." But Judge Silberman interjected, saying those problems did not necessarily affect assessments of Iran and North Korea.

Like the Senate Intelligence Committee report issued last year, this report documented sweeping failures of intelligence collection and analysis, debilitating turf battles, multiple agencies doing the same work, lagging technology and meager ranks of human spies. But it did so in much more vivid terms.

The C.I. A. and the National Security Agency "may be sleek and omniscient in the movies, but in real life they and other intelligence agencies are vast government bureaucracies," it said, "prone to develop self-reinforcing, risk-averse cultures that take outside advice badly."

As a central remedy, the commission prescribes the integration of the scattered agencies under the strong control of the new national intelligence director, Mr. Negroponte, a longtime diplomat who most recently served as ambassador to Iraq and to the United Nations. Under the director, "mission managers" would each be responsible for coordinating intelligence from all agencies on a certain target, which might be a country or a type of weapon.

Mr. Bush assigned his homeland security adviser, Fran Townsend, to oversee the carrying out of the commission's recommendations.

Ms. Townsend said she had already met with cabinet members and asked them to identify recommendations that could be adopted immediately, others that required review and "a small handful" that would require new legislation.

Among the commission's 74 recommendations are the creation of a nongovernment research body to play permanent devil's advocate, challenging the agencies' assessments, and of a National Intelligence University to improve the training of analysts and spies.

The commission proposes the creation of a National Counterproliferation Center of fewer than 100 people to manage and coordinate intelligence on the threat of weapons proliferation, especially from private networks like Dr. Khan's. It would join the National Counterterrorism Center as coordinating bodies under the director of national intelligence.

Other ideas are likely to face stiff resistance from the agencies. Saying the Central Intelligence Agency's existing clandestine service is unlikely to overcome a history of poor performance, the report recommends creating a new Human Intelligence Directorate within C.I.A. to build a better spy service. It also urges major reshuffling of the F.B.I. and the Justice Department.

At the heart of the report is the dispiriting, though increasingly familiar, account of the failure on Iraqi weapons. The intelligence service was "crippled by its inability to collect meaningful intelligence on Iraq's nuclear, biological and chemical weapons programs," it said, and fell back on "old assumptions" based on Saddam Hussein's past behavior that he must be aggressively building an unconventional arsenal.

The National Intelligence Estimate on Iraqi weapons produced in 2002 took the assumptions "and swathed them in the mystique of intelligence, providing secret information that seemed to support them but was in fact nearly worthless, if not misleading," the commission said.

The commission provides a strange sort of exoneration for the Iraqi National Congress and Ahmad Chalabi, the onetime Pentagon favorite who was accused of fueling the drive to war by providing false information about Mr. Hussein's arsenals to American officials and the news media. Quoting a C.I.A. investigation conducted after the war, it said "I.N.C.-related sources had a minimal impact" on the administration's assessments. But it also calls two sources in the I.N.C. "fabricators."

On one of the most delicate questions raised by the Iraqi intelligence failure, the report said "the analysts who worked the Iraqi weapons issues universally agreed that in no instance did political pressure cause them to skew or alter any of their analytical judgments."

But the commission added a caveat. Apparently referring to repeated statements from Mr. Bush, Vice President Dick Cheney and other top policy makers suggesting that Mr. Hussein had illicit weapons stockpiles, the report said, "It is hard to deny that intelligence analysts worked in an environment that did not encourage skepticism about the conventional wisdom."

The report said the intelligence agencies were behind the technological curve in crucial areas, notably biotechnology, and woefully ignorant of important cultural issues. During the cold war, the agencies had impressive expertise on Soviet society and ideology, the report noted, but it said, "No equivalent talent pool exists today for the study of Islamic extremism."

While C.I.A. gets the most attention, the eavesdroppers of National Security Agency also get a very critical look. While writing in vague terms to avoid compromising sources, the commission said Mr. Hussein's government was able to foil many of N.S.A.'s eavesdropping attempts.

Technological changes in telecommunications have put major sources of intelligence out of reach of N.S.A.'s signals intelligence, the technical term for eavesdropping, it said, adding, "Regaining signals intelligence, access must be a top priority."

The commission takes a strong stand against leaks to the news media of classified intelligence information, which it says have "cost the American people hundreds of millions of dollars, and done grave harm to national security." It proposed that an inspector general working for the director of national intelligence be assigned to investigate all leaks and deter them by firing or prosecuting identified leakers.

In a brief note on interrogations, the commission said that captured detainees provided one source of critical intelligence and added that it had had been assured that Attorney General Alberto R. Gonzales personally approves interrogation techniques that go beyond methods that are openly published, apparently referring to publicly known military interrogation guidelines.

The report adds, "Where special practices are allowed in extraordinary cases of dire emergency, those procedures should require permission from sufficiently high-level officials to ensure compliance with overall guidelines."

Reaction to the report was generally positive. Representative Jane Harman of California, the top Democrat on the House Intelligence Committee, praised the commission but said its recommendations could still languish without strong support from the president, Congress and Mr. Negroponte. "There's about a six-month window before turf battles and the inertia of Washington will sink this," she said.