- The Washington Times - Friday, February 13, 2009

In a stark departure from the Bush years, the U.S. intelligence community now says that the plunging global economy is a bigger threat to U.S. security than al Qaeda or the spread of weapons of mass destruction.

The United States is still engaged in two wars, but Director of National Intelligence Dennis C. Blair, a retired Navy admiral, told Congress Thursday that the worsening economy leads the list of “emerging areas of concern.” Other growing threats include climate change and worldwide food, water and energy shortages, he said.

Mr. Blair appeared to put pressure on Congress to act quickly to stem the economic downturn, although he did not mention specifics, such as President Obama’s economic recovery package.

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“Time is probably our greatest threat,” he said. “The longer it takes for the recovery to begin, the greater the likelihood of serious damage to U.S. strategic interests.”

In the past, U.S. intelligence officials have called al Qaeda and the threat of spreading weapons of mass destruction the biggest challenges to U.S. security. But Mr. Blair changed that saying, “The primary near-term security concern of the United States is the global economic crisis and its geopolitical implications.”

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Mr. Blair, who oversees all 16 U.S. intelligence agencies, said the new economic crisis could produce the kind of adverse political climate not seen since Europe between the world wars.

“Of course, all of us recall the turmoil of the 1920s and 1930s in Europe, the instability, and high levels of violent extremism,” he said. “Though we do not know its eventual scale, it already looms as the most serious global economic and financial crisis in decades.”

In his assessment, Mr. Blair said al Qaeda is less of a threat now than a year ago, both because of actions in Pakistan and improved security in Iraq, though he added that the terrorist organization and its leader, Osama bin Laden, remain intent on attacking the U.S.

He said the likelihood of homegrown extremists in America does “not yet rise to the numerical level or exhibit the operational tempo or proficiency we have seen in Western Europe,” which has larger populations of disaffected Muslims and other immigrants.

More similar to previous assessments, the admiral did point to what he called an “arc of instability” throughout the Middle East. He said Iranian scientists “are continuing to develop a range of technical capabilities that could be applied to producing nuclear weapons, if a decision were made to do so.”

He said Iran continued to develop medium-range ballistic missiles.

One bright spot, according to the assessment, is Iraq.

Mr. Blair said that the majority Shi’ite population is less inclined to look to violent cleric Muqtada al-Sadr, whose party performed poorly in last month’s provincial elections, for political leadership.

“Iraqis now are less inclined to resolve their differences through unsanctioned violence, and fewer Iraqis are dying at the hands of their countrymen than at any time in the past two years,” he said, a turnaround from the intelligence community assessments from 2007 and 2008.

His comments on the economy marked the biggest shift from past threat assessments.

The vice chairman of the Senate Select Committee on Intelligence, Christopher S. Bond, Missouri Republican, told Mr. Blair that he shared his concerns about the state of the economy but wanted to make sure the intelligence community would not be focusing on economic issues at the exclusion of more traditional threats.

“I hope you don’t mean by that that the primary focus of the intelligence community is going to be on finding out what you recently described as readily observable and open-source information on the conditions of the country,” he said.

Mr. Blair replied, “My intent in drawing attention to the economic crisis was more to inform policy of the things that could really cause real problems for the United States if they developed a certain way. But I won’t be turning satellites to look at GDP accounts.”

A former spokesman for the CIA, Bill Harlow, said Thursday, “It is very unusual for a threat assessment to include the U.S. economic calculation as part of its calculus, but we are living in extraordinary times and I believe it’s a reasonable position for him to take.”

In 2008, Michael McConnell, the director of national intelligence at the time, put “the continuing global terrorist threat” at the top of his list, though he also recognized a growing danger of political instability in poor countries because of rising food and energy prices.

One economist said the intelligence warning on the economy was “probably exaggerated.”

Desmond Lachman, a resident fellow at the center-right American Enterprise Institute, acknowledged that emerging markets are likely to be affected.

“A place like Russia that was counting on high oil revenues, or a place like China that is very dependent on increasing its exports abroad, those places are now going to have very deep recessions. China has a very big employment problem,” he said. “Both China and Russia could be venturing into foreign adventures in order to distract domestic attention from the problems with the economy.”

But Mr. Lachman added, “If Iran is developing a nuclear weapon and launching a satellite into space, I can’t say that is less of a threat than the global economic crisis.”

In his testimony, Mr. Blair said that a quarter of the nations around the world already have experienced “low-level instability such as government changes because of the current slowdown.”

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