- The Washington Times - Friday, September 20, 2002

U.S. intelligence agencies need to focus on terrorist groups as closely as they do nation-states, a senior Pentagon official told a congressional panel yesterday.

"For the past 50 years, U.S. intelligence has concentrated on defeating external nation-state threats," Deputy Defense Secretary Paul Wolfowitz said before the joint House-Senate panel investigating pre-September 11 intelligence failures.

"It is now clear we must apply the same level of effort to non-state actors and threats that emanate within our borders," he said.

One of the lessons from the September 11 attacks is that "when people threaten openly to kill Americans, we should take them very seriously," Mr. Wolfowitz said.

"That is true of Osama bin Laden and it is true of the regime in Baghdad," he said. "We must not assume that our enemies share our views about what is rational or irrational."

He said that intelligence funding was increased in 1999 but was cut for fiscal years 2000 and 2001.

Mr. Wolfowitz appeared before the committee with Deputy Secretary of State Richard Armitage during the second day of open hearings.

On Wednesday, Eleanor Hill, the committee staff director, revealed that intelligence reports in the months leading up to September 11 showed that al Qaeda was planning attacks in the United States and that the attacks could be carried out using hijacked airliners.

She testified that an interim staff inquiry found "mistakes" by U.S. intelligence agencies in not focusing enough on the threat from Osama bin Laden and terrorism.

Mr. Armitage said that in the months before September 11 the intelligence agencies reported that "we might have an explosion in Kenya from an explosive-laden aircraft."

"I do not specifically remember a mass-casualty event," he said. "I, in general, perceived the threat to be at our interest overseas, primarily in the [Persian] Gulf, some in Southeast Asia and most definitely in Israel."

Mr. Wolfowitz said another lesson from the September 11 attacks is that the U.S. government should not underestimate the skill of terrorists in concealing activities and deceiving the United States.

"They understand how we collect intelligence, how we are organized and how we analyze information," he said. "Just like them, our intelligence services must constantly adapt and innovate.

"We need to adapt our intelligence system to the information age," Mr. Wolfowitz said. "Old stovepipes are being broken down and must be broken down. The culture of compartmentation is being reconsidered and must be reconsidered. In all that we do, we must emphasize speed of exchange and networking to push information out to people who need it, when they need it, wherever they are."

Greater information sharing is needed to better deal with terrorism, he said.

The Pentagon, which controls the majority of the estimated $35 billion annual intelligence budget, is setting up a new undersecretariat for intelligence as a "focal point" for better information sharing, he said.

Mr. Wolfowitz said U.S. intelligence agencies do not have a full understanding of the network of Islamic terrorist groups that have conducted attacks on Americans.

"We don't have that kind of precise information about what groups are there," he said. "We don't know what countries or what groups have sleeper cells buried around the world now. We know what people have capabilities, and we know what people have declared hostile intentions towards us."

CIA spokesman Bill Harlow issued a statement yesterday disputing some aspects of Miss Hill's report, particularly suggestions that the agency did not devote significant resources to fighting terrorism before the attacks.

The agency doubled personnel in its Counterterrorism Center the nerve center for fighting terrorism between 1997 and the attacks, Mr. Harlow said. Before the September 11 attacks, the agency had 115 analysts looking at terrorism issues nearly three times what Miss Hill's report stated.

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