Part 10: Body of Secrets....Muscle

CHAPTER ELEVEN 

MUSCLE 

CNAMIIN TQSWGIMY'C CMOK GWNOK ASKMO QY BKVMB TQVEC ZMNZJK NTO EKMAJO SRB JUEJABJX BR XJBRQK YTATBMRS EDTSO MWCUPQI OXC OQWC HQUU KXZ QWHIKXZO OKDSR ZSUKMMCKWU KDXGWX QDV OWOWXLDF FSGWE FVW WFADT OD AYWOFSG PUILSC RUXXWD UXZR UJKIED GL SILRUOE OPUGSOL UIWZKEGS 

The southern French city of Toulouse has developed a pinkish tint as a result of the centuries-old blending of brick and red tile. Houseboats line the Canal du Midi, the waterway linking the Atlantic Ocean with the Mediterranean Sea, and a labyrinth of alleyways leads to the embankments of the Garonne River. On the northern outskirts of the city sits a small factory on the winding Chemin du Pont de Rupe. There, in December 1997, a salesman by the name of T. Dècle * became a fly caught in UKUSA's worldwide electronic web. In the shadow of the nearby Pyrenees, where the Visigoths and also Charlemagne once ruled, the complex system of eavesdropping satellites, hidden antennas, and powerful supercomputers began telescoping down to the beige phone on the unsuspecting salesman's desk. 

*not real name for his safety

In the equatorial forests of French Guiana, the air was leaden with humidity during the brief interludes between fierce downpours. Forty miles west of the capital of Cayenne, the Kourou River feeds into endless mangrove swamps and tropical marshlands. There, on March 14, 1996, a sleek white Ariane 44P rocket rose above the green canopy of coconut palms and screeching macaws at the European Space Agency. After three months of testing and calibration, INTELSAT 707 was nudged into its geostationary orbit high above the tiny West African island nation of Sao Tome and Principe. There, like an orbital switchboard, it was capable of relaying up to 90,000 telephone calls and data transmissions simultaneously throughout Europe, Africa, and Asia. 

Twenty-two thousand miles below and to the north, on a mist-hazed cliff in England's Cornwall, intercept operators at GCHQ's Morwenstow listening post, near Bude, were working around the clock. Like an outfielder under a high fly ball, the Morwenstow station was ideally positioned to secretly catch the new satellite's beam containing thousands of simultaneous messages and conversations. In the days following the satellite's activation, technicians in the station worked overtime attempting to log and program into their computers and Echelon software the channels with the highest intelligence value. 

Sitting high above the Celtic Sea on the edge of Sharpnose Point, the base has nearly a dozen dishes pointed to the heavens. It was originally built in the late 1960s, largely with money from NSA, to eavesdrop on communications flowing down to Europe from the early INTELSAT satellites. A brief sixty miles away, also in Cornwall, was Britain's commercial ground station for the satellites, at Goonhilly Downs. 

Once the Morwenstow station was completed, the director of GCHQ at the time, Sir Leonard Hooper, sent his personal thanks to Marshall Carter. "I know that I have leaned shamefully on you, and sometimes taken your name in vain, when I needed approval for something at this end," Sir Leonard wrote. "The aerials at Bude ought to be christened 'Pat' [Carter's nickname] and 'Louis' [Tordella]!" Hooper added, "Between us, we have ensured that the blankets and sheets are more tightly tucked around the bed in which our two sets of people lie and, like you, I like it that way." 

Later Carter commented on the letters, explaining Hooper's budget problems and how he would approach his superiors for the money. "He says, 'Well, look, you can turn me down from the British viewpoint, but I'm in bed with Pat Carter on this thing—this is a joint requirement; he needs it as badly as I do. The product that he is going to develop for us will come right to us, so would you take another look at this, because he wants it, it will help him in his business. We'll get the results of it.' " 

Today, among UKUSA's key targets are Iran, China, and North Korea. Just as Morwenstow eavesdrops on INTELSAT communications to Europe, INTELSAT signals to the Far East are monitored from a large American listening post in Japan. There, at Misawa Air Base on the northern tip of Honshu Island, the antenna area looks like a soccer field for giants. Fourteen large radomes, like mammoth soccer balls, sit on a stretch of green. Nearby is an elephant-cage antenna, over 100 feet tall and nearly a quarter-mile wide. 

The signals collected by the antennas are piped into a modern windowless building known as the Misawa Cryptologic Operations Center. Inside, NSA civilians and 1,800 tri-service (Army, Navy, Air Force) military Sigint specialists work in shifts. Among them are the Naval Security Group and the Air Force 301st Intelligence Squadron, which performs "satellite communications processing and reporting." One of the satellites on which Misawa performs "processing and reporting" is an INTELSAT 8 launched over the Pacific on June 27, 1997, with a capacity for up to 112,500 simultaneous phone calls. 

The Army's 750th Military Intelligence Company is also there. Of the Army intercept operators and analysts, many are so-called 98Ks: signals collection/identification analysts. They are involved in the "collection, identification, exploitation, and analysis of digital and analog communications, to include voice, teleconferencing, videoconferencing, facsimile, computer-to-computer traffic, and telemetry." In other words, everything that might go through an INTELSAT. 

The days of intercepting Morse code are long gone. Today the focus is on intercepting and analyzing far more complex digital satellite communications. According to an Army intelligence publication, " 98Ks will 'break' digital signals into a recognizable form so that the 98C (signals intelligence analyst), 98G (voice interceptor), 98H (communications locator/interceptor), and 98J (electronic intelligence interceptor/analyst) soldiers can further exploit the intelligence within the 'digital window.' " 

Some of the advanced training is done at the Navy's Technical Training Center at Corry Station in Pensacola, Florida. Other courses are given remotely, from NSA's National Cryptologic School. Among the courses are FORNSAT (Foreign Satellite Collection), COMSAT (Communications Satellite Collection), Cellular Communications Collection, Overhead Collection Management, Computer/Signals Analysis, Bit Stream Analysis, Modems, Multiplexing, Geolocation, Antenna Selection, and Target Development. Among the FORNSATs the Misawa analysts likely focus on are the several domestic China Sats in orbit, also known as DHF-3s. 

Another course is VSAT (Very Small Aperture Satellite [Terminal]) Collection. This type of collection is aimed at intercepting communications using small dishes, such as those used with DirecTV. India's nuclear weapons establishment, for example, uses this method to send and receive encrypted digital messages by satellite.  

Also busy eavesdropping on INTELSATs over the Pacific are New Zealand's listening post at Waihopai and Australia's station at Geraldton, 230 miles north of Perth. A port on the Indian Ocean in the extreme westernmost part of the country, Geraldton was designed primarily to eavesdrop on the two INTELSATs over the Indian Ocean. It is also able to monitor the Pacific Ocean satellites. The station was opened by DSD in 1994, about the same time as GCHQ's Hong Kong station was closing. 

In the post—Cold War years, the proliferation of both nuclear and conventional weapons has joined the chief concerns of the U.S. government. A particular worry is the possible sale by China of nuclear components and missile parts to Pakistan and Iran. Thus, NSA receives numerous requests from the CIA, the State Department, and other "customers" for intelligence on such transfers. Analysts at these agencies submit to NSA long, detailed watch lists containing keywords and names. 

After NSA receives the watch lists containing the keywords, names, phrases, telephone and fax numbers, analysts assign four-digit numbers to them—search codes—and then pass them on, through the Echelon computer system, to the various UKUSA listening posts. There a computer, codenamed Dictionary, searches for those words and numbers among the millions of messages passing through the intercept antennas. It does this much as computers use search engines such as Alta Vista to locate keywords and phone numbers almost instantly in the vast Internet. 

No doubt high on the list of keywords submitted to NSA is the name of Jin Xue Quan, the president of China National Precision Machinery Import & Export Corporation. This Chinese government—owned company, a sort of Missiles 'R' Us on Fu Cheng Road in Beijing, is responsible for foreign sales of missiles and other weapons. Once a listening post gets a hit on Jin, the intercept will automatically be forwarded to NSA. There, an analyst need only enter the search number for Jin and any intercepts from, to, or mentioning him will appear on the analyst's screen. 

Despite the very secret nature of weapons deals, communications about them are seldom encrypted, because each country has separate and incompatible systems. So the parties are forced to resort to commercial faxes, phone calls, and electronic mail. Also, as in any complicated sale, a great deal of electronic "paperwork" is always generated—contracts, warranties, price negotiations, service agreements: the same type of paperwork as is involved if Burger King sells a franchise to a company in Holland. For the UKUSA partners, this enormous "paper" trail is collectable over the open airwaves through their worldwide electronic dredging operation. 

Terrorists also frequently use unencrypted communications, because  for encryption the caller and the receiver must have compatible systems. Since at least one party is often traveling, carrying encryption equipment can be cumbersome. 

According to information obtained for Body of Secrets, NSA regularly listens to unencrypted calls from suspected terrorist Osama bin Laden, in hiding in Afghanistan. Bin Laden uses a portable INMARSAT phone that transmits and receives calls over spacecraft owned by the International Maritime Satellite Organization. This is the same system used by most ships and some people who travel to remote locations, such as oil explorers. According to intelligence officials, Bin Laden is aware that the United States can eavesdrop on his international communications, but he does not seem to care. To impress cleared visitors, NSA analysts occasionally play audiotapes of Bin Laden talking to his mother over an INMARSAT connection. 

When targets do use encryption, or when the information is sent by diplomatic pouch, cyberspies have to be creative. "With regard to encryption," said one former official, "you look for places outside the zone. At some time he has to go to the Danish freight forwarder or Danish shipping guy to ask him a question—‘I need a ship with extra heavy reinforced decking with a hatch this size.' So we just need to look other places. Yeah, it's going to be harder. Look for letters of credit being cut—they almost always have to go to a regular bank." 

Vast numbers of messages and phone calls are intercepted from the INTELSATs, and likewise the power and speed of the NSA computers that sift through the sea of information are enormous. According to William Studeman, "U.S. intelligence operates what is probably the largest information processing environment in the world. Consider this: Just one intelligence collection system alone can generate a million inputs per half-hour. Filters throw away all but 6,500 inputs; only 1,000 inputs meet forwarding criteria. Ten inputs are normally selected by analysts and only one report is produced. These are routine statistics for a number of intelligence collection and analysis systems which collect technical intelligence." 

Despite sophisticated software, watch lists, and powerful computers, signals intelligence analysis is an attempt to solve a puzzle whose pieces are difficult to see, include only small bits of the much larger picture, and are constantly changing. Sometimes the pieces of the puzzle lead to dead ends, and sometimes they lead to great discoveries. Occasionally they may lead to serious consequences for innocent, unsuspecting citizens of friendly countries. Sometimes the answers are just gray and ambiguous. The piece of the puzzle fits but the words don't match. 

Highly secret documents reviewed for Body of Secrets describe in detail how NSA and its UKUSA partners spent years following one difficult trail—that of China's C-802 missile and Iran's attempts to build one of its own. They offer unique insight into the controversial and misunderstood Echelon program, showing the system at its best and also at its most questionable. The documents were reviewed at the National Security News Service in Washington, a nonprofit group that has researched the C-802. 

Four thousand miles west of Toulouse, in Washington, concern had been growing over the help China was giving the Iranian missile program. A particular worry was the deadly C-802, a sleek, sharklike anti-ship cruise missile that could also deliver a chemical or biological payload. The sales brochure of its manufacturer, China National Precision Machinery Import & Export, boasted that the C-802 had "mighty attack capability" and "great firepower"; it had a range of 120 kilometers and resembled the Exocet cruise missile that had killed thirty-seven U.S. sailors on the USS Stark in 1987. C-802s, said James Lilly, the former U.S. ambassador to China, pose a "clear and present danger to the United States fleet." At the time, more than 15,000 U.S. servicemen were stationed in the Persian Gulf. 

For years, Iran had purchased C-802s from China, but officials in Tehran were becoming increasingly troubled about the prospects for future sales. They felt that as China nudged closer to the United States, it might eventually slow down or halt weapon sales to Iran, as it had been doing with Pakistan. 

By the summer of 1997, NSA intercepts of phone calls and faxes among Tehran, Beijing, and Hong Kong were beginning to indicate that Iran might be attempting to build the missiles themselves. The prospect made many in Washington very nervous, because if Iran produced its own missiles the United States would have even less ability to monitor and control its inventory. The near-supersonic weapons could wreak havoc against American ships sailing in the Persian Gulf. But the key to the missile was the complex, high-precision turbojet engine that powered it. It was built by Microturbo, SA, a firm based in Toulouse. Few believed that Iran would be able to successfully build such a machine on its own. 

Then, in July 1997, NSA delivered some bad news to the White House. Its electronic vacuum cleaner had intercepted a phone call from Tehran to Hong Kong revealing that Iran was attempting to reverse-engineer the French Microturbo engine—to acquire one and then peel it back, layer by layer, until it understood the engine well enough to build one. Then Iran would attempt to obtain engine parts for as many as 100 missiles from Microturbo by disguising the parts' ultimate destination. According to the intercepted conversation, instead of having Microturbo ship the parts to Tehran, Iran would have them sent to a Hong Kong company called Jetpower. Jetpower would then forward them on to Iran, although it is unclear from the intercepts whether or not the company knew of the deception. To further screen the true nature of the shipment, the equipment would be labeled "Generator 4203 mini—jet engine." 

Iran seemed to be pulling out all the stops. GCHQ, through its Morwenstow antennas, intercepted a call from an Iranian official in Paris to Tehran indicating that Iran was considering hiring a notorious arms dealer to help obtain the Microturbo engine. On July 29, 1997, an overcast but warm Saturday in Paris, the Iranian official, a Mr. Mehrdad, met with Syrian arms trafficker Monzer al-Kassar. 

Flabby and gray-haired, the forty-nine-year-old al-Kassar had traveled to Paris from his home in Marbella, Spain, where he operated a company called Conastra Trading. In 1992, al-Kassar was arrested in Spain on charges of providing weapons and financing for the 1985 hijacking of the Italian luxury liner Achille Lauro but was later acquitted. A man of many passports as well as identities, al-Kassar had been part of the covert network run by Lieutenant Colonel Oliver North during the days of the Iran-contra scandal. It was revealed that al-Kassar had received $1.5 million to purchase weapons. When he was questioned about al-Kassar, former U.S. national security adviser John Poindexter said, "When you're buying arms, you often have to deal with people you might not want to go to dinner with." 

Mehrdad told his contact in Tehran that "the meeting had gone very well" and that they should invite both al-Kassar and another international arms dealer, the French-born Bernard Stroiazzo-Mougin, to Tehran for further discussion on ways to acquire the Microturbo engine. According to the GCHQ report, "Stroiazzo-Mougin is Director of North Atlantic Airways. In August 1996, he was noted [in earlier GCHQ intercepts] supplying electron tubes and Boeing 707 and 747 aircraft spare parts to an Iranian company." 

Mehrdad concluded the July 29, 1997, conversation by telling alKassar that he was certain they would be able "to do very big things." A few weeks later al-Kassar faxed to Tehran details concerning the half dozen people he was going to bring with him on his visit to Iran— mostly engineers from South Africa, as well as Stroiazzo-Mougin—to discuss the missile project. GCHQ dutifully intercepted the list, which included such key data as dates of birth and passport numbers. 

By September, Iran's fears about the Chinese connection seemed to be coming true. Chinese officials told their Iranian counterparts that the latest shipment of C-802 missiles had been temporarily halted because of "technical problems." There were no "technical problems." According to U.S. intelligence reports, the Chinese government had quietly decided to cease delivery of the missiles until at least after the late October summit  meeting in Washington between China's president Jiang Zemin and Bill Clinton. Also according to the intelligence reports, General Mohammad Vahid-Dastjerdi, the Iranian deputy minister of defense, didn't buy the "technical problems" excuse and accused the Chinese of being unprepared to stand up to Western pressure and lacking in resolve. 

In Washington on October 29, behind blue and white sawhorses across from the White House, protesters chanted and shouted. But as the long black armor-plated limousine arrived with President Jiang Zemin, a military band drowned out the demonstrators with the national anthems of both the United States and China. 

Following the summit talks, a news conference was held in the Rose Garden. In the crisp fall air, under a bright sun, Clinton addressed the issue of nuclear proliferation. "President Jiang and I agree," he said, "that the United States and China share a strong interest in stopping the spread of weapons of mass destruction, and other sophisticated weaponry in unstable regions, and rogue states, notably Iran." In part on the basis of President Jiang's assurances that China had halted missile sales to Iran, Clinton granted permission for U.S. companies to sell nuclear power plant equipment to China. But Clinton was relying on more than Jiang's word: behind the scenes, away from the press and the public, he was relying far more heavily on NSA to tell him whether China was keeping its agreement. 

In November, NSA intercepted messages confirming earlier reports: Iran had decided to go it alone and build its own missile. Plucked from an INTELSAT were faxes indicating that six months earlier, in May, a deal had been struck between Iran and Microturbo. The intercepts included a letter of credit, valued at over $1.1 million, issued by Iran's Defense Ministry to Microturbo. The terms of the contract indicated that there was little time left: the "goods" were to be shipped to Iran by December 3, less than a month away. They were to be loaded on an Iranian ship in Antwerp, Belgium, which would take them to Bandar Abbas, Iran. 

At the White House there was outrage over the NSA report on the backdoor deal between Microturbo and Tehran's generals. In June the United States had sent a démarche—a diplomatic protest—to France complaining about earlier sales of Microturbo engines to China. In response, the French Foreign Ministry agreed to prohibit future sales by the company to China as well as "to other pariah states such as Iran out of principle." 

Now, as a result of the NSA intercepts, a second démarche was issued, this time requesting an investigation into the Microturbo contract with Iran. More U.S. protests followed. Officials from the American embassy in Paris approached the French Foreign Ministry again about  the same time, and Pentagon officials called on the French defense attaché in Washington. But the French would only say, unofficially, that the Microturbo contract simply involved "generators," not missile engines. 

Finally, when no formal reply was forthcoming, an unusually high level and blunt protest was made to the French Foreign Ministry. "It is our understanding," it said, "that Microturbo's generators and jet engines are almost entirely identical, and only slight modifications are necessary to turn the 'generator' into a jet engine." 

Although it was December, the atmosphere in Microturbo's offices was decidedly hot following the U.S. diplomatic protests over who their clients were and what they were shipping. The issue was especially sticky because Microturbo had a subsidiary located in Grand Prairie, Texas, and that subsidiary depended greatly on U.S. government contracts for sales of its turbojet engines. 

What employees of Microturbo did not know was that they had become entangled in UKUSA's electronic web. Thus when T. Dècle, a company official, faxed a message to Mr. R. Heidari, an Iranian defense official, it was intercepted by GCHQ's Morwenstow antenna, several hundred miles away. Transferred to the agency's headquarters at Cheltenham, it arrived on the desk of an analyst who specialized in weapons systems and had been following the C-802 closely. The analyst concluded that Microturbo was attempting to "mask involvement in Iranian anti-ship [C-802] cruise missile component deal." 

In his report, the GCHQ analyst wrote that Dècle had informed the Iranian military officials "that he would advise them in the next few days of Microturbo's position. To avoid any faxes being missent to Microturbo's U.S. subsidiary, Dècle requested that in the future the headers of faxes should not show the name of the U.S. subsidiary, and he also asked them to use a specific French fax number." 

The secret intercepts offered clear, hard evidence that the Jiang/Clinton summit was having a positive effect. Inside a low, pale-colored government building near a busy intersection in Tehran, Hossem Jafari, the official responsible for buying the C-802 missiles from Beijing, was becoming more and more angry at the Chinese, who were reneging on their contract. His anger was specifically directed at China National Precision Machinery Import & Export Corporation. 

In early December, Jafari marched over to China Precision's office in Tehran and demanded some answers from Wen Bo, the local representative. Like a man who had been conned, Jafari laid into Wen. He demanded to know why China Precision had not returned his calls, why the contracts had not been fulfilled, and why he had been given no explanations. Jafari said he had instructed his financial department to  cease all payments and then demanded that Wen Bo immediately call China Precision's president, Jin Xue Quan, or its vice president, Ji Yanshu, for an explanation. 

Wen Bo did as Jafari asked and made the call to Beijing. While Jafari listened to Wen Bo's side of the conversation, NSA was eavesdropping on both sides. Over the telephone, Wen Bo told an official at China Precision that he was in an embarrassing position because he had received no instructions on the missile deal. He then listed Jafari's complaints and asked to speak to the top executives. In response, an official suggested to him that although both Jin Xue Guan and Ji Yanshu were both in the building, he should tell Jafari that the executives were temporarily out and could not be reached. Wen Bo did as he was told, and Jafari left as angry as he arrived. However, he said, he did not blame Wen Bo but rather the "policymakers" in Beijing. 

The Jiang-Clinton summit, according to the NSA intercepts, also affected a long-planned trip to Tehran by a delegation of China Precision engineers. They were scheduled to travel to Tehran in October, just before the summit, to help repair and service the missiles already delivered. The trip was then delayed for several months. Finally, in December, just before the team's rescheduled arrival, Beijing sent Wen Bo some disappointing news. "The future looked bleak," the NSA report quoted the Chinese officials. The delegation had been shrunk to just three persons and they were going to Tehran only to carry out some nonspecific discussion about contract matters, "not to actually do anything about them." When the delegation finally arrived at Tehran's Mehrabad Airport on December 4, a still-boiling Jafari asked them why the two top executives of the company had never got back to him. He was simply told that "the current situation had already gone beyond the realm of CPMIEC's [China Precision's] control; consequently, Jin and Ji were not able to reply." 

For Jafari, things did not get better. In February 1998 he learned from press accounts what he was never told directly: China had pledged not to sell any more cruise missiles to Iran. In a further meeting with officials of China Precision, the Iranian officials demanded renewed commitment within two weeks; otherwise, cooperation between Iran and China might be suspended. 

These intercepts brought smiles to normally glum officials at the White House and State Department. "The complaints lodged by Tehran suggest Beijing is holding firm on the original pledge," said a State Department intelligence report. "Since the commitment was made, the U.S. has detected only one possible shipment to Iran of small components related to the air-launched version of the C-802." Giving up on China, Iran began working hard at reverse engineering and attempting to build its own missiles with the parts already received. "Iran 350 may already have received some or all of the equipment necessary to assemble C-801 or C-802 missiles before the commitment was made," said the State Department report. 

In March, the U.S. defense attaché based in Tel Aviv reported that an Israeli military intelligence official had passed on some hot information. "According to IDF DMI [Israeli Defense Force, Directorate of Military Intelligence], Iran signed a contract in 1993 with the Chinese corporation CPMIEC for the procurement of C-801 and C-802 missiles for its naval units and shore-to-sea missile batteries." The U.S. defense attaché could barely keep from laughing at this report, which, he warned, might include "circular reporting from U.S. intelligence exchange program." That is, he felt it was simply something Israel had happened to pick up from U.S. intelligence and was feeding right back to U.S. intelligence for "credit." "Caution should be exercised in using this information for direct reporting. ... It is interesting that the Israelis are dredging up old information to serve as a vehicle for renewed request for information on the Iranians, or, in the alternative, are just now obtaining information on six-year-old contracts." 

(According to a former intelligence official involved in nonproliferation issues, "Ninety percent of what we did we relied on Sigint— ninety percent of nonproliferation comes through NSA. We get some Humint [human intelligence], some from the attachés, some from the Israelis— they had a reporting requirement with us, they had to send us something through the attaché every week to justify their $5 billion a year.") 

Six months after the summit, intercepts indicated that China was keeping its pledge to refrain from selling the cruise missiles to Iran. "Recent intelligence reports suggest Iran is dissatisfied with China's failure to implement existing ASCM [antiship cruise missile] contracts," said an April 1998 intelligence report. Nevertheless, Tehran planned one last-ditch effort. Iranian officials made plans to fly to Beijing on April 15 to air their frustration and discuss future cooperation. If the trip was ever made, it was of little avail. 

With China having backed out of its contract, Iran turned inward. In December 1998, Iran's then president, Ali Akbar Hashemi Rafsanjani, claimed that Iran had become "technologically self-sufficient" in missile development. 

After analysts at NSA review intercepts, such as those between Tehran and Microturbo, they write up reports and send them out to customers. Many of the reports are stamped with exotic codenames, such as "Gamma," which is reserved for Sigint of the highest sensitivity. "Within Gamma they had double G, which was higher than Gamma," said one former official. "Double G material was sent to people by hand [Director of Central Intelligence George] Tenet, [Secretary of State Madeleine] Albright, and so forth. This included material from friendly nation wiretaps. 'EG' was Executive Gamma, blue cover sheet." The analysts also mark reports with a three-letter code indicating where the intercept was obtained. "FRD," for example, indicates that the information in the report came from intercepted French diplomatic communications. "ILC" indicates that it was intercepted from an "international licensed carrier," such as a commercial telecommunications channel. There is also a subject tag, such as "ABIG," for "Arms Investigation of Tracked Vehicles," which indicates that the intercept concerns tracked weapons vehicles. Thus the analyst need only enter "ABIG" into his computer and all intercepted messages over the past few days dealing with that topic would pop up. 

The analysts are searching through the world's private whispers every day, yet after a while even that becomes routine. "I looked for blackmarket arms sales," said one former customer, an analyst for a federal agency. "I would arrive in the morning, go to my NSA web site— they had a search engine—pull it down. Keywords were 'letter of credit,' 'contract,' 'bill of lading,' 'middleman,' 'dealer,' 'broker.' I had eight to ten categories. In about an hour I would go through all my message traffic [intercepts]. It would say, 'We searched and we found twenty-seven things that meet your criteria.' And then you have the subject lines. You click on the subject line and the message will come up. These will be the reports, you never see the raw intercepts. It would say something like, 'On the fourteenth of March some person in the Iranian Ministry of Defense contacted so and so at the embassy in blah blah. They discussed the following topics.' It would give a description of the conversation, it would reference other cables on the same issue. And then if they faxed something—the letters of credit or contracts—they would be in there." 

The analysts in NSA work, for the most part, in standard cubicles. On their desks are several computer monitors. As a security measure, the one on which they read the intercepts is not connected to the outside world. A second computer is connected to the public Internet, and analysts are forbidden to input classified material into it, for fear of hackers. Many analysts have reel-to-reel tape recorders for listening to the intercepted voice conversations. "They had pictures above their desk of the guys they were listening to," said one person who spent time in the area. He said that often such photographs were obtained by intercepting the fax when someone transmitted a copy of his or her passport in applying for a visa. After listening to the voices of the same unsuspecting individuals, hour after hour, day after day, many analysts begin to feel they know them. "They used to tell me, 'Even if I have never seen these guys, if I ever got on an elevator and heard their voice I'd jump through the roof. You get to know these voices as well as your wife's.' " 

The question of whether or not to bring a dèmarche to a foreign government is always a difficult issue, especially when the discovery of a violation comes from NSA's Sigint. The State Department is usually in favor of issuing a dèmarche, but NSA is occasionally opposed because it might reveal to the foreign country that its communications are being intercepted. "In order to bring a dèmarche to a foreign country," said one official, "we would first have to get permission from NSA to declassify or reduce the classification of the information. They were usually pretty good about it." 

The CIA, however, was a different story. "The Agency [CIA] guys never bothered telling you what they were doing, if they bothered showing up' at the meeting," said the official. "The NSA would at least make it usable. The Agency [CIA] would say, 'You're not to dèmarche this country because we've got an op going.' We say, 'What's the op?' And they say, 'We can't tell you.' They never tell you when it's over, unless you follow it up with them. It's like they almost didn't care, they had other fish to fry. You know nonproliferation just wasn't important." 

Normally, to hide the source of the underlying information, a certain period of time was allowed to pass before a dèmarche was issued. "We'd never go in doing this stuff right away, because they'd know," said one former official. "We'd have to sit on the stuff for weeks sometimes. And then they'd think that some guy talked to his girlfriend or blabbed to a hairdresser. You've got to put time and distance between it." 

Through UKUSA's worldwide eavesdropping web, NSA and its partners were able to peek behind scenes and determine how well the agreement between the United States and China was holding up. In the days of the Cold War, "verification" simply involved photo satellites snapping images, and analysts counting missile silos and launchers. But today, it is not what is planted in the ground but what is planted in someone's mind that is critical to know. For that, imaging satellites are useless and only signals intelligence can provide the answers. Without Sigint, Washington would have been left in the dark. No other intelligence source—human, military, diplomatic, photo, Israeli— provided the answers produced by the Echelon system. (Echelon is a software program whose name has become a generic term for eavesdropping on commercial communications.) 

But the history of the C-802 problem also shows the dangers associated with Echelon. Once GCHQ intercepted the fax Microturbo's T. Dècle sent Iran's Heidari, it was passed on to NSA, the Canadian CSE, and Australia's DSD, as well as to the British Secret Intelligence Service (MI-6) and customs offices. Like most of the other intercepts dealing with the cruise missile deal, it was not sent to New Zealand's GCSB, possibly because of continued bitterness over that country's declaration that it was a nuclear-free zone. 

At NSA the information on Dècle went to W9P3, the Missile Proliferation section of W Group, the Global Issues and Weapons Group. NSA in turn sent the report on Dècle to a number of CIA stations around the world, including those in Paris and Bonn, as well as to the U.S. Commerce Department and to Customs. Thus, within a few days of Dècle's fax, there were probably hundreds of people in at least four countries around the world reading it and possibly putting Dècle's name on some blacklist, as if he were an enemy of the state. The question, however, was whether the analysts were correct. Was Microturbo sending a missile engine to Tehran, as they suspected, or was it simply an innocent generator, as France was claiming? As with many cases in the gray, shadowy world of Echelon, little is strictly black and white. 

To resolve the issue, French export inspectors flew to Antwerp as the ship containing the "special items" was preparing to sail to Iran. Upon opening the crates, they later told U.S. authorities, they confirmed that the "special items" were generators. This caused U.S. authorities to conduct a "reevaluation" of the NSA and GCHQ transcripts. In light of the French information, NSA concluded that some of the intercepted conversations were more ambiguous than originally believed. They admitted that the equipment sent by Microturbo in fact could have been a generator, but one with potential military uses. "It doesn't mean we were necessarily wrong" in the earlier reports, said one U.S. official. "But if we'd known of the doubts before, we wouldn't have done things [written the reports] that way." 

The chairman of Microturbo, Jean-Bernard Cocheteux, also flatly denied that the generator had any usefulness as a missile engine. They were "very different from engines used to propel missiles," he said, and not useful in building missile engines. "Microturbo, SA, never assisted Iran in any way" on any missile, he added. 

The issues involving Dècle are central to the debate over the potential harm caused by UKUSA's worldwide eavesdropping system. Had he been a citizen of one of the UKUSA nations, his name would have been deleted before the report was ever sent out. But because he was not, his name made its way into the computers and possibly onto the watch lists of intelligence agencies, customs bureaus, and other secret and law enforcement organizations around the world. It is unknown with whom those organizations might then have shared the information. 

If this did happen, maybe nothing would come of it, or maybe the next time Dècle tried to enter the United States or Britain he would be refused without explanation. Maybe he could even be arrested. Also, after the NSA "reevaluation," were the new conclusions casting doubt on the earlier reports sent to everyone who had received the originals? Or were those recipients left only with the reports indicating that Dècle and Microturbo were secretly selling a cruise missile engine to Iran? Complex issues involving innocent non-UKUSA persons, similar to those raised by the Microturbo intercepts, are likely to occur hundreds of times a week throughout the UKUSA countries. As government surveillance technology becomes even more pervasive, the risks to individual rights grow proportionally. 

By 2001, the UKUSA partners had become an eavesdropping superpower with its own laws, language, and customs. It operated secret antennas in nearly every corner of the planet and deep into outer space. Just as mighty navies once ruled the high seas, UKUSA's goal is to rule cyberspace. On a wall at NSA is a plaque presented to Kenneth A. Minihan by GCHQ shortly after his arrival as director in 1996. "Celebrating fifty years of successful partnership," it says, and then notes the "special relationship" of "the English-speaking peoples." 

In the late 1990s, for the first time since the in-depth congressional hearings a quarter of a century earlier, NSA was facing probing questions about its eavesdropping activities. This time they were coming mostly from European parliaments, skeptical reporters, and an unusual alliance of left and far-right groups in the United States. In Europe, the principal concern was the suspicion that NSA was eavesdropping on business communications and passing on trade secrets to European firms' American competitors—stealing from Airbus and giving to Boeing, for example. 

Interviews with dozens of current and former NSA officials indicate that the agency is not currently engaged in industrial espionage, stealing data from one company and giving it to a competitor. But there is no law preventing the agency from doing so, and because its customers, including the White House and the CIA, dictate NSA's targets, it could conceivably engage in such espionage in the future. The only prerequisite would be a secret verbal order from the president or the director of Central Intelligence that industrial espionage was now a national security requirement. According to information obtained for Body of Secrets, something like that came close to happening in 1990, during the administration of President George Bush. 

At the time, Vice Admiral William O. Studeman was the director of NSA. "There are a substantial number of legal problems associated— legal and ethical problems—associated with the concept of trying to provide intelligence information directly to business in the United States," said Studeman in 1990. "And so I believe that this decision has not yet been made. I believe that we are going to move in the direction of considering this with great caution. ... I believe that it's going to be years, and a very slow process and one that's going to be very deliberate as to  what kinds of decisions are going to be made." 

Direction, said Studeman, would come from above. "We would not be the ones to make that decision," he said. "I would have to defer to the director of Central Intelligence and receive his guidance on this particular subject." The 1990s were a time, said Studeman, when "clearly the area of economics is now becoming the area of principal concern to the American citizen. This is being reflected in the polls. More people are concerned about economic competitiveness than they are concerned about military problems or many other issues in the world today." 

In short, the time was ripe to begin quietly turning America's big ear on Airbus and other tough foreign competitors, and had the decision been made, NSA would have begun complying. The issue for the agency was not ethics but mechanics, according to Studeman. 

"If economic intelligence and economic competition are defined as a national security interest, the intelligence community is essentially going to have to spread its resources across a lot more of the problem, and the problem is still very big," he said. "When you take all the geographic distribution possibilities and add on top of it the military, political/diplomatic, economic, sociological, ecological, and every other kind of area we're being asked to look at now . . . it's a new world and it's possible we could be caught short and have some cold starts." He added, "The real issue for us is whether or not we can find a way to, number one, successfully collect that intelligence, which is a nontrivial achievement in and of itself, if it were ever directed. And secondly, how do we use it? ... There isn't any use to collecting it if it cannot be used." 

For years NSA had collected economic intelligence, but the agency had not specifically eavesdropped on particular companies for the purpose of industrial espionage. "Right now what broad information NSA collects on trade and that sort of thing in the world," said Studeman, "we provide to federal agencies whether it's Commerce or Treasury or the State Department. We provide that information directly and they are a federal consumer." 

Rather than supply direct competitive intelligence to American business, NSA was directed to increase support for the business community—and the American economy—in more indirect ways. One means was to beef up efforts to discover illegal and deceptive tactics, such as bribery, used by foreign competitors to win contracts away from American companies. The other was to devote more resources to providing intelligence to U.S. government negotiators during important trade talks. 

NSA had long played a "defensive" role in helping to prevent foreign countries from spying on American companies. "What we use the intelligence instrument for is collecting against other people who are  collecting against us for industrial espionage purposes," said Studeman, "or to collect against other people who are not playing by internationally accepted rules of the road or business ethics." But in 1990 the question being debated in the Bush White House and at CIA was whether the NSA would begin going on the "offensive." "We will be definitely helping out on the defensive side," said Studeman. "But the school's out on the offensive." 

In one "defensive" case, the CIA obtained details of an offer by French business executives to allegedly bribe Brazilian officials to steer a $1.4 billion contract toward Thomson-CSF and away from the Raytheon Corporation. Raytheon later won the contract. In 1995, a report presented to Congress cited "almost one hundred cases of foreign firms using bribery to undercut U.S. firms' efforts to win international contracts with about $45 billion." It added, "The foreign firms that offer bribes typically win about eighty percent of the deals." 

"If we had any certain evidence," said Studeman, "that someone was essentially targeting an American company, the [intelligence] community would essentially go to that company and actively inform them they are being targeted and also might provide them some kind of advice on how to enhance their security or at least make recommendations about how technically . . . [to] reduce their vulnerability." 

Former CIA director R. James Woolsey was far more blunt about NSA's eavesdropping on European companies to detect crooked tactics. "Yes, my continental European friends, we have spied on you," he said. 

And it's true that we use computers to sort through data by using keywords. . . . That's right, my continental friends, we have spied on you because you bribe. Your companies' products are often more costly, less technically advanced, or both, than your American competitors'. As a result you bribe a lot. So complicit are your governments that in several European countries bribes still are tax-deductible. 

When we have caught you at it, you might be interested [to know], we haven't said a word to the U.S. companies in the competition. Instead we go to the government you're bribing and tell its officials that we don't take kindly to such corruption. They often respond by giving the most meritorious bid (sometimes American, sometimes not) all or part of the contract. This upsets you, and sometimes creates recriminations between your bribers and the other country's bribees, and this occasionally becomes a public scandal. We love it. 

As mentioned earlier, during the 1990s NSA also became more aggressive in providing intelligence during key international trade conferences. Fifty years ago to the day after NSA's predecessor the Signal Security Agency eavesdropped on the San Francisco conference that led to the United Nations, American signals intelligence specialists were preparing to bug another conference. This time, in June 1995, the participants were the United States and Japan, and the subject Japanese luxury car imports to the United States. As before, American negotiators tried to have the conference entirely on U.S. soil, where eavesdropping would be much easier: the Japanese wanted to meet on their own home turf. But a compromise was reached: the talks were to be held partly in Geneva, Switzerland, and partly in Washington. 

The dispute was over a $5.9 million punitive tariff on fourteen Japanese luxury cars, scheduled to take effect on June 28. On Sunday night, June 25, U.S. Trade Representative Mickey Kantor arrived in Geneva for the start of the latest round of talks aimed at averting the rapidly approaching deadline. The next morning, at the Intercontinental Hotel near Lake Geneva, in the shadow of the Swiss Alps, Kantor held a press conference. President Clinton, he said, "has directed me to come here and make our best efforts to see if there is any way to open Japanese markets and expand trade as we have been trying to do." 

To help Kantor's negotiating team make those "best efforts," an NSA team had been flown in weeks earlier and was housed nearby. They were there to supply the team with intercepted conversations among auto executives from Toyota and Nissan, who were pressuring their government for a settlement. Fortunately for the eavesdroppers, the Japanese negotiators frequently bypassed secure, encrypted phones because insecure hotel telephones were more readily available and easier to use. 

But while NSA looks for bribery and eavesdrops on trade missions, there is no evidence that it is a handmaiden to corporate America. Nor, apparently, does GCHQ engage in industrial espionage. In 1984 Jock Kane, a former supervisory intercept operator with thirty years' experience at GCHQ, wrote a blistering manuscript accusing the agency of mismanagement and sloppy security. Before it was published, however, the manuscript was seized by the British government under the Official Secrets Act and never saw the light of day. Publication, said the order, "would be a breach of duty of confidentiality owed to the Crown, and contrary to the provisions of the Official Secrets Act." 

In a copy of the manuscript obtained by the author before the seizure, Kane discusses what is clearly the Echelon system, although he does not use the codename. Of industrial espionage, he points out:  

Much of the targeting is ILC—International Licensed Carriers. . . . Thousands of messages are processed every week from these links, on every possible subject, from diplomacy to business, oil supplies, crop failures in any part of the world, down to ordinary domestic telegrams. 

From these intercepts pours a wealth of industrial intelligence information into the memory cells of GCHQ's vast computer complex, information that would have been a tremendous asset to British industrialists, but British industry has never had access to this information because GCHQ chiefs, not the Cabinet, took the decision that British industry, which to a large extent finances this vast bureaucracy, should not be one of their "customers." 

The issue for Europe is not whether UKUSA's Echelon system is stealing trade secrets from foreign businesses and passing them on to competitors; it is not. The real issue is far more important: it is whether Echelon is doing away with individual privacy—a basic human right. Disembodied snippets of conversations are snatched from the ether, perhaps out of context, and may be misinterpreted by an analyst who then secretly transmits them to spy agencies and law enforcement offices around the world. 

The misleading information is then placed in NSA's near-bottomless computer storage system, a system capable of storing 5 trillion pages of text, a stack of paper 150 miles high. Unlike information on U.S. persons, which cannot be kept longer than a year, information on foreign citizens can be held eternally. As permanent as India ink, the mark may remain with the person forever. He will never be told how he was placed on a customs blacklist, who put him there, why he lost a contract—or worse. 

One snippet of NSA or CIA information concerned an Egyptian immigrant, Nasser Ahmed, who was seeking asylum in the United States. The secret information led to his arrest; he was denied bail and held for more than three years in solitary confinement pending his deportation. Despite years of efforts by his attorney, Abdeen Jabara, once a subject of illegal NSA surveillance himself, he was never told what the "secret evidence" consisted of, where it came from, or how the United States obtained it. In this Kafkaesque world, he could not fight the charges because he was not told what they were: they were secret. It was only after considerable pressure from the Arab-American community that the Justice Department finally ordered some of the information released. Ahmed was then able to successfully challenge it and win his freedom. "With a better understanding of the government's case," wrote the judge in August 1999, the secret evidence "can no longer be viewed as sufficiently reliable to support a finding that [Mr. Ahmed] is a danger." At the time, more than two dozen other people around the country were being held on such "secret evidence." A few months later, another federal judge ruled that to hold someone, whether or not a U.S. citizen, on the basis of "secret evidence" was unconstitutional. 

Unchecked, UKUSA's worldwide eavesdropping network could become a sort of cyber secret police, without courts, juries, or the right to a defense. 

Whether NSA spies on American citizens has long been a troubling question. Its past record is shameful, not only for what the agency did but for how it went about it. In the late 1960s NSA was an agency unrestrained by laws or legislative charter and led by a man obsessed with secrecy and power. By then Louis Tordella had been deputy director for a decade, during which he had taken the agency from a sleepy backwater to the largest and most secret intelligence organization in American history. Never before or since has any one person held so much power for so long in America's spy world. But where most top officials are drawn to public recognition like moths to streetlights, Tordella was drawn to the darkness. So dark was Tordella's world that he became lost in it, unable anymore to recognize the boundary lines between U.S. citizens and foreign enemies and between a government of open laws and one of secret tyranny. All ears and no eyes, Tordella was leading his agency and his country toward a deep abyss. 

Thus in the fall of 1967, when the U.S. Army began requesting intercepts on American citizens and groups, the agency blindly complied. At the time, the military was worried about a massive "March on the Pentagon," organized to protest the war in Vietnam. Army officials compiled a list of protesters and asked NSA to put their names on its watch lists. Over the following months, other agencies, including the CIA, FBI, and DIA, followed suit. The folksinger Joan Baez was considered a threat and placed on the list, as were the well-known pediatrician Benjamin Spock, the actress Jane Fonda, and Dr. Martin Luther King, Jr. Like weeds in an untended lot, the lists multiplied as more and more people were added and as people who had dealings with the targets became targets themselves. 

The domestic watch list program took on added importance on July 1, 1969, when it was granted its own charter and codeword: Minaret. "MINARET information specifically includes communications concerning individuals or organizations," it said, "involved in civil disturbances, antiwar movements/demonstrations and Military deserters involved in the antiwar movements." An equally important aspect of Minaret was  keeping NSA's fingerprints off the illegal operation. "Although MINARET will be handled as Sigint and distributed to Sigint recipients, it will not," said the charter, "be identified with the National Security Agency." 

Frank Raven, in charge of G Group, which focused on the nonCommunist world, was upset by the sudden switch to domestic eavesdropping but could do little about it. At one point, after being given the name of a U.S. citizen to target, he protested. "I tried to object to that on constitutional grounds as to whether or not it was legal—as to whether or not we should do it," he said, "and I was told at that time that you couldn't argue with it—it came from the highest level." Some of the targets, he said, were downright "asinine." "When J. Edgar Hoover gives you a requirement for complete surveillance of all Quakers in the United States," recalled Raven, "when Richard M. Nixon is a Quaker and he's the president of the United States, it gets pretty funny." Hoover apparently believed that the religious group was shipping food and supplies to Southeast Asia.[So what if they were DC] 

Since taking office in January 1969, Richard Milhous Nixon had waged a two-front war, one in Southeast Asia against North Vietnam and the other at home against a growing army of antiwar activists. Convinced that foreign interests were financing the antiwar movement, on June 5, 1970, he met in the Oval Office with Vice Admiral Noel Gayler, who was then the director of NSA, and the chiefs of the CIA, DIA, and FBI. Also present was Tom Charles Huston, a thirty-year-old Hoosier who had been on Pat Buchanan's research and speechwriting staff. A lawyer and recently discharged Army intelligence officer, the young White House counsel had been appointed the point man on the issue. 

"Based on my review of the information which we have been receiving at the White House," Nixon told his spy chiefs that Friday afternoon, "I am convinced that we are not currently allocating sufficient resources within the intelligence community to the collection of intelligence data on the activities of these revolutionary groups." According to the DIA's Lieutenant General Donald V. Bennett, "The president chewed our butts." 

At Fort Meade, Tordella regarded the change of policy as "nothing less than a heaven-sent opportunity for NSA." At last, he would be able to turn his massive parabolic antennas inward on the unwitting American public. Following submission of an "Eyes Only" memorandum entitled "NSA Contribution to Domestic Intelligence" and signed by Gayler, Huston drew up a proposal for Nixon's signature. It authorized NSA "to program for coverage the communications of U.S. citizens using international facilities." No warrant or probable cause would be required; anyone's international telephone calls or telegrams could be intercepted and distributed. "The FBI does not have the capability to monitor international communications," said the document, which became  known as the Huston Plan. "NSA is currently doing so on a restricted basis and the information it has provided has been most helpful. Much of this information is particularly useful to the White House." Restrictions were also lifted on other spy agencies. 

But if there was jubilation in Tordella's office, there was outrage at the FBI. J. Edgar Hoover "went through the ceiling" after reading the report. Tordella had earlier warned Gayler: on matters relating to domestic intelligence, no one challenged Hoover. The old lawman saw the move by NSA and the other intelligence agencies into his territory as a direct threat to his exclusive domain. 

Out of character as a champion for civil liberties, Hoover stormed into the office of Attorney General John Mitchell and demanded the order be withdrawn. Mitchell agreed. The illegalities spelled out in the memorandum, he said, could not be presidential policy. Mitchell eventually convinced Nixon to drop the program; five days after authorizing it, the president withdrew his approval. 

At NSA, Tordella and Gayler were angry over Hoover's protest and the cancellation of the Huston Plan. Nevertheless, they had been conducting domestic intelligence targeting without authorization for many years, and they saw no reason to stop just because the president had formally withdrawn his approval. In fact, the watch lists of American names flowed into NSA faster than ever. 

Huston was informed that a new White House aide would be taking over responsibility for internal security matters and that from now on he would be on the new aide's staff. He was then introduced to his new boss, a young lawyer who had worked under Mitchell at the Justice Department and had been transferred to the White House only a few days earlier: John Wesley Dean III. Dean tossed the Huston Plan in his office safe and spun the dial. 

Three years later, like a body discovered in the woods, the Huston Plan came back to haunt Nixon. By then the Watergate scandal had brought his presidency to disaster and the Oval Office resembled a shelltorn bunker. Every day, new revelations sent cracks down the cream colored walls. Among the most serious problems was the recent defection of John Dean. He had given the Huston Plan to the prosecution as a bargaining chip in his plea for immunity. Because few in the White House recalled the plan's contents, there was a scramble to grasp the document's importance. 

On May 16, 1973, a worried Richard Nixon met in the Oval Office with his lawyer, J. Fred Buzhardt, Jr., to discuss the new development. "Well, what the hell is this?" said Nixon. 

"What he has, Mr. President," Buzhardt explained, "there was a plan for intelligence gathering, primarily in the domestic area." 

Nixon smelled blackmail. "Oh—it's in the domestic area, so he thinks that's gonna scare us," he said. "What in the name of God is this? Why do you think he's played this game?" 

"I have no idea, Mr. President," replied Buzhardt. "But we have managed to identify from his remarks—I have found a copy of this thing, at NSA—I just talked to Lou Tordella." 

That late Wednesday afternoon, Buzhardt was particularly worried because the document clearly showed that Nixon had ordered NSA to begin illegally targeting American citizens. But even after more than four years in the White House, Nixon had no idea even what NSA was— despite the fact that he had signed the order. 

"Now, I'm fairly sure NSA . . . ," Buzhardt began, but then Nixon cut in. 

"What is the NSA?" he asked. "What kind of action do they do?" 

"I don't know the specifics," replied Buzhardt. "They pick up communications stuff, they don't actually tap." 

"Anything the NSA did is totally defensible," Nixon instinctively shot back. 

"I think it's defensible," said Buzhardt, "but I think that they move into a broader category with respect to domestic affairs." 

Nixon was again confused. "Right, meaning, picking up by—what do you mean, electronic surveillance?" 

"Targeting—yes sir—targeting U.S. citizens' conversations that were on international circuits," explained Buzhardt. 

"Doing so because of their concern about their being involved in violence?" Nixon asked. 

"Yes, sir," agreed Buzhardt. 

Not only had Nixon forgotten signing the document, he had also forgotten canceling it five days later. But the Defense Intelligence Agency had earlier reminded Buzhardt of the fact. 

"DIA says that—thinks it was terminated?" asked Nixon. 

"They think it was terminated," said Buzhardt. "And they told me independently from Huston that they think the approval was recalled, and that's what Huston said. Now we're going to check this thoroughly with NSA, and the reason it's important is because if you remember, they [NSA] were the most aggressive group to go forward." 

"NSA," said Nixon. 

Buzhardt agreed, "NSA." 

"NSA probably did something," added Nixon, finally catching on. "The electronic work." 

They also began discussing NSA's long battle with the FBI over embassy break-ins in Washington. Tordella had long pressured Hoover to send his black-bag specialists into various embassies in Washington in order to steal codes and bug cipher machines. This was far less time consuming than attempting to break the codes at NSA using computers, a method known as brute force. For many years Hoover had approved such operations, but in 1967, worried about the scandal that might result if one of his teams was discovered, he stopped the practice. 

In an effort to force Hoover to begin cooperating again, Gayler met with him and Attorney General John Mitchell on March 29, 1971. NSA, he said, was "most desirous" of having the black-bag coverage resumed. Hoover erupted, saying he "was not at all enthusiastic" about such an extension of operations, in view of the hazards to the FBI. Despite the meeting, the feud continued and it was only after L. Patrick Gray took over as acting FBI director, following Hoover's death on May 2, 1972, that the Bureau once again began embassy break-ins on behalf of NSA. 

During the May 1973 Oval Office meeting with Buzhardt, Nixon brought up the embassy black-bag jobs, adding them to his growing list of problems that might surface as a result of Dean's defection. "They never quite got a handle on it until Pat Gray was appointed," said Buzhardt. 

"Shit," exclaimed Nixon. 

"Pat went out to visit NSA, and took four of his assistants with him, and he told Lou Tordella, 'I understand we used to do things with you that were very helpful.' Pat was putting back together the assets." 

"[Who] told you this?" asked Nixon. 

"Tordella told me this," said Buzhardt. 

Nixon later made a cryptic remark to his top aide, H. R. Haldeman, that seems to indicate that black-bag jobs at the embassies of India and Pakistan may have led to the breaking of their ciphers. 

"In fact, the India-Pakistan one," said Nixon, "that's the way it was broken. . . . Although that's one we've got to bury forever." 

Nixon's meeting with Buzhardt went late into the night and then continued the next morning. The two were worried not just about the documents but also about whether NSA might have secretly recorded any of its officials' conversations with White House officials concerning the targeting of Americans and the black-bag jobs. 

"I don't know," said Buzhardt. "I wouldn't be surprised if they [NSA] tape the conversations going in and out of there. I don't think they would admit it."  

"No, they shouldn't," said Nixon, apparently supporting NSA's secret taping of all calls to and from the agency. 

"Even to me," replied Buzhardt. "But I had the definite impression." 

"They're a (starry-eyed?) bunch," said Nixon. (The parenthesis is in the original.) 

Buzhardt added, "There are (75,000?) people there." (Parenthesis in original.) 

"I think Hoover taped all his conversations," said Nixon. 

During his May 16 and 17, 1975, discussion with Nixon, Buzhardt also brought up another of NSA's enormously secret and illegal operations, one codenamed Shamrock. It involved an agreement whereby the major U.S. telegraph companies, such as Western Union, secretly turned over to NSA, every day, copies of all messages sent to or from the United States. (Indeed, by the 1970s, NSA had developed a watch list consisting of the names of more than 600 American citizens. These names had been placed in NSA's computers and any communications containing one of those names—such as the telegrams obtained through Shamrock—would be kicked out, analyzed, and sent to whoever in the federal government wanted the information thus obtained.) "Well, Mr. President," Buzhardt said, "the way the collection operation works—on some in and out line, this foreign collection—what some of the communication companies here use to pick those communications up, that go to the foreign country and back." 

Nixon had little interest in this, because it did not directly relate to his Watergate problems. "But at least that's one Watergate story that's—" 

Buzhardt completed the sentence. "That's going to be a dud," he said. "NSA participation in anything domestic—they define it as foreign politics." 

Luckily for NSA, Buzhardt and Nixon said no more about Shamrock. But in 1975, two years after Nixon resigned, another investigation began picking up clues to the operation. This time it was a probe by Idaho's Senator Frank Church into possible illegal actions by the U.S. intelligence community. 

One of the investigators assigned to the committee was L. Britt Snider, a thirty-year-old lawyer. "I was given the task," he said, "of trying to crack what was perceived to be the most secretive of U.S. intelligence agencies, the National Security Agency." His boss warned him, "They call it 'No Such Agency.' " 

Snider began by asking the Congressional Research Service for everything on the public record that referred to NSA. "The CRS soon supplied us with a one-paragraph description from the Government Organization Manual," he said, "and a patently erroneous piece from Rolling Stone magazine. ... In 1975, NSA was an agency that had never before had an oversight relationship with Congress." 

Early clues to NSA's darkest secrets came from comments in the final report of an earlier investigation into the intelligence community, this one led by then Vice President Nelson Rockefeller. "The first was a reference to an office in New York that CIA had provided NSA for the purpose of copying telegrams," said Snider. "The other disclosed that CIA had asked NSA to monitor the communications of certain U.S. citizens active in the antiwar movement. At last we had something to sink our teeth into." 

For weeks, NSA stonewalled all questions and requests for documents on the two areas. Finally, the Church Committee sent formal interrogatories to NSA, but the agency claimed that the subject was so sensitive that only Church and John Tower, the ranking minority member, would be permitted to be briefed. But then a story appeared in the New York Times alleging that NSA had eavesdropped on the international communications of U.S. citizens. "With the allegations now a matter of public record," said Snider, "NSA wanted to explain its side of the story." At NSA, Snider was briefed on Operation Shamrock, which was so secret that only a few even within the agency knew of its existence. 

"Every day," the briefer told Snider, "a courier went up to New York on the train and returned to Fort Meade with large reels of magnetic tape, which were copies of the international telegrams sent from New York the preceding day using the facilities of three telegraph companies. The tapes would then be electronically processed for items of foreign intelligence interest, typically telegrams sent by foreign establishments in the United States or telegrams that appeared to be encrypted." Although telegrams sent by U.S. citizens to foreign destinations were also present on the tapes, the briefer added that "we're too busy just keeping up with the real stuff" to look at them. The briefer then said the program had been terminated by the secretary of defense the previous May, as the Church Committee began looking into NSA. "I asked if the secretary had ended it because he knew the Committee was on to it," said Snider. "Not really," the briefer said, "the program just wasn't producing very much of value." 

But whenever Snider attempted to probe into the background of the operation—how it started, who approved it, and how long it had been going on—he was constantly told, "I don't know." The keeper of the secrets, the briefer said, was Dr. Louis Tordella, who had retired in April 1974 as deputy director. 

On a Sunday afternoon in September, Snider knocked on the front door of Tordella's Kensington, Maryland, home. "Tordella was clearly  uncomfortable with the whole idea of confiding in someone like me," said Snider. "He said he was not so worried about me as about the Committee and what it might make of the 'facts.' He asked me what I knew about Shamrock. I told him. He sighed a long sigh and then began a discourse on Shamrock that lasted into the early evening." 

Tordella told Snider about Shamrock's origins in the days following World War II. "All the big international carriers were involved," Tordella said, "but none of 'em ever got a nickel for what they did." The companies had been assured at the time that President Harry S. Truman and Attorney General Tom Clark were aware of the program and approved its continuation. But Tordella knew of no further high-level approval until he finally told Secretary of Defense James R. Schlesinger in 1973. "To his knowledge," said Snider, "Schlesinger had been the only secretary to have such a briefing," even though NSA reports to the secretary of defense. 

Like an inmate making a jailhouse confession, Tordella outlined the illegal scheme. Snider later summarized it: 

During the 1950s, paper tape had been the medium of choice. Holes were punched in the paper tape and then scanned to created an electronic transmission. Every day, an NSA courier would pick up the reels of punched paper tape that were left over and take them back to Fort Meade. In the early 1960s, the companies switched to magnetic tape. While the companies were agreeable to continuing the program, they wanted to retain the reels of magnetic tape. This necessitated NSA's finding a place to make copies of the magnetic tapes the companies were using. In 1966, Tordella had personally sought assistance from the CIA to rent office space in New York City so that NSA could duplicate the magnetic tapes there. This lasted until 1975, Tordella said, when CIA pulled out of the arrangement because of concerns raised by its lawyers. NSA then arranged for its own office space in Manhattan. 

Tordella recalled that while many NSA employees were aware of Shamrock, only one lower-level manager—who reported to him directly—had had ongoing responsibility for the program over the years. . . . Tordella recalled that years would sometimes go by without his hearing anything about Shamrock. It just ran on, he said, without a great deal of attention from anyone. 

I asked if NSA used the take from Shamrock to spy on the international communications of American citizens. Tordella responded, "Not per se." NSA was not interested in these kinds of communications as a rule, he said, but he said there were a few cases where the names of American citizens had been used by NSA to select out their international communications, and to the extent this was done, the take from Shamrock would have been sorted in accordance with these criteria. He noted that . . . the Nixon administration had thought about turning over Shamrock to the FBI, but the FBI did not want it. 

When I asked if it was legal for NSA to read the telegrams of American citizens, he replied, "You'll have to ask the lawyers." 

I noted that I would have expected the companies themselves to be concerned, and Tordella remarked that "the companies are what worry me about this." He said that whatever they did, they did out of patriotic reasons. They had presumed NSA wanted the tapes to look for foreign intelligence. That was NSA's mission. If the telegrams of American citizens were looked at, the companies had no knowledge of it. 

I countered with the observation that, by making the tapes available to the government, the companies had to know they were providing the wherewithal for the government to use them however it wanted. They had to bear some responsibility. 

The comment caused Tordella's temper to flare for the first time during our interview. The companies were not responsible, he reiterated, they were just doing what the government asked them to do because they were assured it was important to national security. If their role were exposed by the Committee, it would subject them to embarrassment, if not lawsuits, and it would discourage other companies from cooperating with U.S. intelligence for years to come. I told him that the Committee had yet to determine how the whole matter would be treated, including the involvement of the companies. We parted amicably, but he clearly had misgivings about how this would turn out. His distrust of politicians was manifest. 

Following Tordella's mea culpa, Snider began probing what the companies knew and when they knew it. Only one former employee, from RCA Global, had been on the job at the beginning of the program. "He said the Army had come to him and asked for the company's cooperation," said Snider, "and, by damn, that was enough for him." An executive from ITT, on the other hand, "came to the deposition surrounded by a phalanx of corporate lawyers who proceeded to object to every question once I had gotten past the man's name and position." Snider said, "I pointed out to them that this was the United States Senate—not a court of law—and, if they wanted to object to the questions I was asking I would have a senator come in and overrule every one of  their objections. They piped down after that." 

When the committee's report was being drafted, Snider argued against the public release of the names of the companies. But the committee's chief counsel, Frederick A. O. Schwartz, disagreed. "The companies had a duty to protect the privacy of their customers," he said; "they deserved to be exposed. If the Committee did not do it, it would become the subject of criticism itself." Pushed by Church, the committee voted to make its report public—over NSA's vehement objections, and to the great displeasure of its Republican members. 

President Gerald Ford telephoned Church and other senators, imploring them to reconsider. But Church was determined to go forward and the next day, Lieutenant General Lew Allen, the NSA director, was scheduled to testify before the committee in public session—a situation unprecedented for NSA. (The testimony on which the report was based had, of course, been given in closed session.) There, in the packed hearing room with television cameras rolling, Allen faced the full committee. Church himself raised the issue of Shamrock, although he did not name the companies. "In his view," said Snider, "the program was illegal, and its disclosure would not harm national security." But after a flurry of objections by Republican members of the committee, including Senators Barry Goldwater and Howard Baker, Church agreed to reserve any further discussion of Shamrock for closed session. 

Over the next few days, the White House continued to plead with the committee to drop all mention of Shamrock from its final report. "For the first time since the Committee began operations," said Snider, "Attorney General Edward Levi, speaking expressly on behalf of the president, personally appealed to the Committee not to publish the Shamrock report on the grounds that publication would damage national security." But the weight of opinion among committee members was for disclosure. "Senators were bothered that the telegrams of Americans had for years been handed over to an intelligence agency," said Snider. "Whatever its legality, it should not have happened. . . . Why was the identification of the companies a national security concern? Yes, the report might be embarrassing to them and they might even get sued because of it, but why should that make it classified?"

So the committee voted to disregard the White House objections and leave in the damning material. "It remains to this day the only occasion I know of where a congressional committee voted to override a presidential objection and publish information the president contended was classified," said Snider.

Months later, in March 1976, the committee was notified that "a lower-level employee" at NSA had discovered a file relating to Shamrock— the first such file found. (The committee's report had been based on 369 testimony it heard.) "The file proved to be a mother lode of information," said Snider. "The documents also cast doubts on the veracity of the companies' claims that they could find no documentation pertaining to Shamrock. After all, this had concerned the highest levels of their corporate management for at least four years."

By 2000 Snider had risen through the intelligence community to become the CIA's inspector general. Looking back, he said, "I came to see that relations between intelligence agencies and the private sector endured. Lawyers became more involved than they used to be, but questions of legality were no longer ignored or unresolved. Agreements were put in writing and signed by the responsible officials.

"I also came to think that the investigation, in the long term, had a beneficial effect on NSA. With no desire to undergo another such experience, NSA adopted very stringent rules in the wake of the Church Committee to ensure that its operations were carried out in accordance with applicable law. Where the communications of U.S. citizens were concerned, I can attest from my personal experience that NSA has been especially scrupulous. As upsetting and demoralizing as the Church Committee's investigation undoubtedly was, it caused NSA to institute a system which keeps it within the bounds of U.S. law and focused on its essential mission. Twenty-three years later, I still take some satisfaction from that."

Among the reforms to come out of the Church Committee investigation was the creation of the Foreign Intelligence Surveillance Act (FISA), which for the first time outlined what NSA was and was not permitted to do. The new statute outlawed wholesale, warrantless acquisition of raw telegrams such as had been provided under Shamrock. It also outlawed the arbitrary compilation of watch lists containing the names of Americans. Under FISA, a secret federal court was set up, the Foreign Intelligence Surveillance Court. In order for NSA to target an American citizen or a permanent resident alien—a "green card" holder—within the United States, a secret warrant must be obtained from the court. To get the warrant, NSA officials must show that the person they wish to target is either an agent of a foreign power or involved in espionage or terrorism. 

But because these issues fall under the jurisdiction of the FBI within the United States, NSA seldom becomes involved. Thus, according to a senior U.S. intelligence official involved in Sigint, NSA does not target Americans at home. "I want to make it clear," said the official, "[that] we do not intentionally target known U.S. persons in the United States— period. And therefore, we don't go to court to get a warrant to target any such people because we don't do any of those ... FBI worries about spies in the United States." The same goes for foreigners suspected of terrorism, he said. "Osama bin Laden . . . comes into the United States, he crosses the border," said the intelligence official. "We wouldn't do the guy. It would be FBI who'd do him, because he's a terrorist in the United States." Thus, the vast majority of the 886 eavesdropping warrants approved by the Foreign Intelligence Surveillance Court in 1999—the highest number ever—were from the FBI. 

Judicial protections, however, stop at the border. "FISA doesn't cover the U.S. person who's outside the United States," added the official. To target Americans outside the country, all that is needed is the approval of the U.S. attorney general. Nevertheless, the number of Americans targeted by NSA overseas is very small. "At any one time," said the senior intelligence official, "there may be five. . . . These persons are—there's virtually no doubt that they are agents of foreign powers. Either they're terrorists or they're some kind of officer or employee of a foreign government. We're not talking about Jane Fonda." [don't even get me started on our star chamber,republic my ass.DC]

He added: "We'll find out that person X in a foreign country is a terrorist. And maybe he has a green card and he used to live in the United States. He's got a green card, we treat him as a U.S. person. So most of the people that we're after are not citizens but resident aliens who have gone back to another country." 

On the other hand, NSA does not need a FISA Court order to spy on foreign embassies and diplomats within the United States, just an okay from the attorney general, which is good for a full year. 

The deliberate targeting of Americans is only one issue. The other is what is done when an American—or a citizen of one of the other UKUSA nations—incidentally turns up in the reams of intercepted traffic. This is becoming more and more likely as technology advances. "The networks have collapsed into one another," said one senior NSA official, "and many of our targets are on the same network that we use. It is now just 'the network'—the global telecommunications infrastructure." 

Heavy restrictions are placed on the dissemination of names of UKUSA residents. This is in stark contrast to the freewheeling use and distribution of European names, such as Dècle's. NSA's bible governing "whom we may target, how we collect, select, and store such information, and how we disseminate information on U.S. persons" is United States Signals Intelligence Directive 18 (USSID 18), "Limitations and Procedures in Signals Intelligence Operations of the United States Sigint System." It was first drawn up in May 1976, shortly after the Church Committee investigation, and it is occasionally updated. 

By 1999 a number of people were questioning whether USSID 18 should be completely rewritten to better reflect the workings of modern day signals intelligence. "These concerns are legitimate," said an NSA operations panel. "USSID 18 is not easy to read and understand. It deals with a complicated subject and, therefore, is a document that must be  read carefully. This is not justification, however, for it to be rewritten." 

Key to the directive is the definition of "U.S. persons," because it determines whether a given intercept will be swept in, analyzed, and disseminated. "A person known to be currently in the United States," it says, "will be treated as a United States person unless positively identified as an alien who has not been admitted for permanent residence; or unless the nature or circumstances of the person's communications give rise to a reasonable belief that such person is not a United States person." 

On the other hand, "A person known to be currently outside the United States, or whose location is unknown, will not be treated as a United States person unless such person can be positively identified as such, or the nature or circumstances of the person's communications give rise to a reasonable belief that such person is a United States person." 

In 1994 a forty-seven-page document entitled "U.S. Identities in Sigint" was issued to further clarify under what circumstances the names of U.S. persons must be deleted or may be retained in Sigint reports. While in most cases U.S. names must be removed, the document said, this rule does not apply under certain circumstances—for example, in the event of an emergency "such as a hijacking or a terrorist attack." "When specific, actionable threat information involving U.S. persons is obtained," said one instruction, "reporting elements issue a report with as much information as possible, including U.S. names, in the interest of protecting U.S. persons." NSA uses "Implied Consent Procedures" in cases such as kidnappings or hijackings, "where a U.S. person is held captive by a foreign power or a group engaged in international terrorism and consent for NSA collection could be implied." 

Another exception allows for reporting the communications of U.S. persons when there is "evidence of a crime." These are cases, said the present NSA director, Michael Hayden, where "we bump into violations, or potential violations of law—threats to physical security, possible espionage, possible disclosure of classified information. ... In the last sixteen months, that has happened a total of eighteen times. In those eighteen instances, there were ten instances in which the information was about U.S. persons. Six instances in which it appeared the information was about U.S. persons but we were far, far from definite. And two others—the remaining two other instances, the information was about individuals of unknown nationality. We simply didn't know." 

In 1980, while intercepting everything in and out of Libya, NSA analysts discovered that President Jimmy Carter's brother Billy was doing business with and acting as an unregistered agent of the Libyan government. Bobby Ray Inman, who was then the NSA director, showed  the intercepts to the U.S. attorney general and an investigation was launched, leading to what became known as the Billygate scandal. 

Analysts are forbidden to mention in their reports not only the actual names of U.S. citizens and green card holders but also the names of U.S. companies. "As a general rule," says one internal document, "analysts must select generic terms to replace the U.S. identity and must present the report details in such a way that the customer cannot determine the identity." 

Any time a U.S. identity is mentioned in a Sigint report, the Operations Directorate must keep a record of it for a quarterly report sent to the agency's inspector general. "Please remember," said one internal memorandum, "that if a U.S. identity is disseminated in any fashion, e.g., product, analytical exchange, etc., NSA is then required to account for the times the identity is disclosed outside of the Sigint System, whether the disclosure is intentional or not." 

In an attempt to prevent inappropriate intercepts and dissemination, frequent training sessions are conducted for intercept operators and analysts (seventeen such sessions were held in November 1998, for example). Analysts are offered difficult hypothetical scenarios similar to situations they might encounter, and correct responses are taught. "You have reason to believe that the [cell phone] user is involved in international narcotics trafficking," says one hypothetical, "but you have no information telling you whether or not he is a U.S. person: Can you collect?" 

Despite all the hypotheticals, real-world operations frequently give rise to complex questions concerning just what names and titles to leave in or take out of finished Sigint reports. The following issues have come up in the past few years. 

• In January 1993, a few weeks before President-elect Clinton was going to be sworn in as president, a question arose concerning how to refer to him and his cabinet choices when their names turned up in intercepts. While it violates USSID 18 to refer to U.S. persons by name, senior U.S. executive branch officials can be referred to by title without special permission. The problem was that they were not yet sworn in. 

"The NSA Office of the General Counsel," said an NSA document, "has advised that titles of these candidates may be used in reports . . . as follows: title of position to which candidate has been nominated followed by the word 'designee' (e.g., Secretary of Defense Designee). These titles should be used until such time as the candidates have been confirmed and the Clinton Administration assumes responsibility. Names of the candidates should not be used without prior approval. ... As always, titles should only be used if they are necessary to understand or assess foreign intelligence." 

It is interesting to note that NSA analysts must also delete the names of United Nations officials from reports and, in the case of senior officials, must include only their titles. Generic terms—such as, perhaps, "UN official"—must be substituted for the names of lower-ranking officials. 

• Six months after the inauguration, NSA analysts found the name of Hillary Rodham Clinton turning up in intercept reports. What was her status?

A federal court had determined that her work on health care policy put her in the category of a full-time government official. As a result, "Mrs. Clinton may be identified in reports," said an internal NSA memorandum, "only by title (currently, Chairperson of the President's Task Force on National Health Care Reform) without prior approval when that title is necessary to understand or assess foreign intelligence and when the information being discussed relates to her official duties. Should Mrs. Clinton be assigned to other task forces or official duties in the Executive Branch, those titles may also be used, as necessary. Reports containing information about Mrs. Clinton that is not clearly foreign intelligence must be checked, at a minimum, through Office and Group level 05 [policy] elements. As with other senior officials of the Executive Branch, no reports may be published concerning Mrs. Clinton's private life or activities absent evidence of criminal wrongdoing and even then only after review by senior NSA management and the OGC [Office of the General Counsel]." 

• In 1994, former president Jimmy Carter was invited to travel to Bosnia and Herzegovina by Bosnian Serb president Radovan Karadzic to participate in efforts to help end the war that had been raging there. In December 1994, Carter tentatively accepted the offer and stated that he would travel to Bosnia as a representative of the Carter Center for Peace. 

The Balkans were a key target area for NSA, so the Operations Directorate anticipated that a number of intercepts would mention Carter or would even be to or from him. For this reason, it issued a directive regarding whether Carter's name would appear in NSA reports sent out to "customers": 

The current U.S. Administration [that of President Clinton] has cautiously welcomed this development, but has made it clear that Former President Carter would be traveling to Bosnia as a private U.S. citizen and not as a representative of the U.S. Government. 

Since Former President Carter will not be officially representing the U.S. Government, any reports that reflect either his travels to Bosnia or his participation in efforts to end the war may identify him only as a "U.S. person." Only if Former President Carter eventually becomes an official envoy of the U.S. Government in this activity, could he then be identified as a "former U.S. president." 

• In 1995, there was great concern in Washington over the fate of Michael DeVine, an American who ran a hotel in the Guatemalan rain forest, and Efrain Bamaca Velasquez, a guerrilla leader married to an American lawyer. The evidence indicated that they had both been killed by a Guatemalan military officer on the CIA's payroll and that the agency may have known of the murders. Outraged, Senator Robert Torricelli of New Jersey wrote to President Clinton: "The direct involvement of the Central Intelligence Agency in the murder of these individuals leads me to the extraordinary conclusion that the agency is simply out of control and that it contains what can only be called a criminal element." 

As a result of a number of calls for investigations by both the CIA and Congress, NSA was asked to check its massive database—years' worth of stored raw traffic—for "any information concerning events in Guatemala from January 1987 to the present" relating to DeVine and Velasquez. Seeing that NSA could be dragged into a quagmire by the request, NSA's general counsel reminded the Operations Directorate that federal law "prohibits the collection of communications to, from, or about U.S. persons without approval of either the Director, NSA, the Attorney General, or the FISA Court depending on the circumstances." He added, "NSA is not authorized to collect Sigint for law enforcement or investigative purposes." The lawyers were no doubt worried about intercepts turning up in civil lawsuits or criminal proceedings. 

• In June 1996, as former senator Bob Dole and President Clinton began squaring off for the fall elections, analysts were specially reminded to be careful to avoid mentioning any candidate or political party that might be picked up in an intercept. "The political parties of the U.S. are," said the memorandum, "considered U.S. persons, as are the candidates themselves. Since a U.S. identity is considered to be revealed whenever the reader of a report can recognize a particular U.S. person, avoid identifying the political parties or the candidates by name, unique title, personal identifier, or textual context." 

The memo went on, "We anticipate that as the 1996 election campaigns go on, there may be instances when references to political parties and candidates will be necessary to understand foreign intelligence or assess its importance. In such cases . . . refer to the U.S. identity in generic terms only: a U.S. political party, a U.S. presidential candidate, a U.S. Senate candidate, etc. Remember that even when such terms are used, the context of the report could constitute an identification." 

• During the October 1997 summit in Washington between President Clinton and China's Jiang Zemin, greatly expanded eavesdropping operations were planned. The planning required extensive searching through satellite and microwave channels— "search and development"—for key circuits of potential intelligence value. 

Four months earlier, in preparation for the event, the lawyer assigned to NSA's Operations Directorate sent out a Top Secret/Comint Channels Only briefing memorandum to those preparing for the complex operation. "USSID 18 procedures for Search and Development are broader than those identified in the main body of the USSID," it said; this may have meant that domestic communications channels were to be searched. "During the course of search and development any signals with communications to, from, or about U.S. persons should be handled in accordance with the processing section of the USSID." 

The memorandum then laid out a series of questions the intercept operators and analysts should ask themselves, among which were the following: "Will you get the information through a database?" "Who is the target? What is his/her status as a U.S. person?" "What is the foreign intelligence purpose?" "What do you reasonably expect to get from the proposed electronic surveillance and what is the basis of that belief?" 

The memorandum also established a number of guidelines. "If your focus is a foreign target and you incidentally have a U.S. person on one side of the communications," it said, "the foreign intelligence may be  reported as long as you focus on the foreign aspect and minimize out the U.S. side. The U.S. information must be replaced with a generic term unless it meets [certain other] criteria. ... If someone requests U.S. person information you must have them contact P022 [NSA's Special Product Control Branch]." 

Officials anticipated that analysts would make heavy use of what one document referred to as NSA's "raw traffic storage systems which contain identities of U.S. persons." As a result, analysts were cautioned, "Do your research before you get on the system and try to anticipate what type of information you will get back when you type in your query." 

As tight as the laws, regulations, and internal guidelines governing the NSA are, a few potential loopholes exist. Although NSA takes great pains to eliminate the names of U.S. persons in the reports it sends out, any customer (for instance, CIA or DIA) can obtain the names simply by faxing a request to NSA. The request must offer a reason and state that the name "is necessary to understand the foreign intelligence or assess its importance." In case such a request is received, NSA keeps the names in its database for up to a year. And the agency will not disclose how often names are released through this backdoor procedure. 

"Americans were never listed" in reports, said one of NSA's customers. "It would say 'U.S. Person.' Also for the Brits. If you [the customer] needed the name you could make a request—there's an office called U.S. Identities, and you [the customer] could call them [the U.S. Identities Office] up and send them a letter and say, I need to know who that guy is. They [U.S. Identities] could tell you, if you . . . sent them a letter explaining why. You would tell them the transmittal number, serial number. It didn't make any difference if the U.S. person was in the U.S. or overseas. As long as you give them a reasonable explanation as to why you needed it. And then they [NSA] call you back and they say, 'Hi, we're calling about your letter, serial number so and so,' and they [NSA] would say, 'Here's the name and here's the control number,' so they'd [NSA] have a tracking number." 

"If the [Sigint] report goes out to twenty people, not all twenty people get the identity," said a senior intelligence official involved in Sigint. "Maybe only five people will come in and ask for it. The five people who come in and ask for it have to ask for it in writing, and they have to demonstrate they need it for their official duties and that it's necessary to understand the foreign intelligence or assess its importance. If they don't, we don't give it to them. If they do, then they get the identity of the U.S. person, but there's a record that that has happened." 

Although USSID 18 directs that "communications identified as domestic communications shall be promptly destroyed," there is an exception: "Domestic communications that are reasonably believed to  contain foreign intelligence information shall be disseminated to the Federal Bureau of Investigation (including United States person identities) for possible further dissemination by the Federal Bureau of Investigation in accordance with its minimization procedures." 

Also, international and foreign communications between two Americans can be retained and distributed at the discretion of the director of NSA, providing that he determines that the intercept contains "significant foreign intelligence or possible evidence of a crime." U.S. Attorney General Janet Reno approved these revised guidelines on July 1, 1997. 

While the federal government allows a number of exceptions to its privacy constraints when it comes to average Americans, no exceptions are permitted concerning the government's own communications. If an intercept operator inadvertently picks up a conversation one party to which is a U.S. official, the tape must be destroyed immediately—even if the official is talking to one of NSA's key targets. 

For Americans, the greatest danger of NSA is its involvement with law enforcement. During the Nixon years, NSA was used to secretly target antiwar protesters and others in disfavor with the White House. Today, among NSA's key targets areas are the "transnational" threats: narcotics trafficking, terrorism, international organized crime, weapons proliferation, and illicit trade practices. "The primary purpose of the collection activity," says one NSA document, "will be the production of foreign intelligence information on the foreign aspects of international narcotics trafficking. No collection for law enforcement purposes or in support of law enforcement operations is authorized. All collection must be designed to satisfy national Sigint requirements. Information pertaining to the international narcotics trafficking activities targeted for collection will be forwarded to NSA for analysis and reporting." 

"If the Sigint business can tell the president, 'When you're dealing with this guy, you're effectively dealing with the XYZ cartel,' " said one senior intelligence official involved in Sigint, "that's pretty good information for the president to know." 

One of those most opposed to NSA involvement in law enforcement is the agency's former top lawyer, Stewart A. Baker. "When I was at the National Security Agency," he said, "we used to joke about the predictable stages traversed by prosecutors who sought intelligence reports in connection with big investigations. The first reaction was open mouthed wonder at what the intelligence agencies were able to collect. That was followed by an enthusiastic assumption that vast quantities of useful data must lie in our files. Next came the grinding review of individual documents and the growing realization that the reports were prepared for other purposes and so were unlikely to contain much of  relevance to the investigator's specific concerns. Last came ennui, and a gritted-teeth plod through the reports, mostly to avoid a later charge that the examination was incomplete." 

NSA's major push into law enforcement came with the fall of the Berlin Wall and the collapse of communism. "Because the Soviet Union was no longer a threat," said Baker, "some of the resources devoted to extracting its secrets could be turned to other tasks, to other foreign targets. But some of those foreign targets had a domestic tinge. As topics like international narcotics trafficking, terrorism, alien smuggling, and Russian organized crime rose in priority for the intelligence community, it became harder to distinguish between targets of law enforcement and those of national security." 

Soon, common centers were formed for counterdrug, counterterrorism, counterproliferation, and counter-international organized-crime activities. They were populated by both law enforcement and intelligence personnel, again dangerously mixing the two areas. "Few foresaw any danger in nibbling a bit at the principle that intelligence and law enforcement must remain separate undertakings," said Baker. "Today the risk to civil liberties is largely theoretical. However theoretical [those] risks . . . may be, they cannot be ignored. . . . One of my office's jobs at the agency was to review requests for intelligence from drug enforcement agencies. In some cases, we suspected they were trying to shortcut constitutional or statutory limits, and their requests were denied. But I have no illusions that our objections would have prevailed if a different message had been coming from the leaders of the agency and the government." 

In the end, the question of whether NSA is secretly abusing its enormous powers comes down to trust. " 'Trust us' is the NSA's implicit message," said David Ignatius of the Washington. Post "Trust us to distinguish between the good guys and the bad guys, and to use our powerful surveillance tools for the good of humankind. As an American and a trusting soul, I want to extend that confidence to General Hayden and his beleaguered colleagues. The United States needs an NSA that can shed its threadbare old clothes—and, when necessary, can crack the codes and monitor the conversations of people who could get us all killed. But it is unrealistic to expect the rest of the world to be enthusiastic. People will be glad when the NSA bags that biological terrorist as he's about to deliver the anthrax bomb—even those dyspeptic European parliamentarians. But don't expect them to give the global policeman much help along the way—or to stop demanding the same privacy rights that Americans have." [global policeman??? Says who, talk about self serving bulls*$t DC]

On a Monday evening in January, everything suddenly went quiet.  NSA's brain, overworked, had a sudden seizure, a blackout. Its ears continued to hear, pulling in the millions of messages an hour, but its mind could no longer think. 

Three miles away in his stately brick home on Butler Avenue, NSA Director Michael Hayden, an Air Force lieutenant general, had just finished his dinner and was watching television when his secure STU-III phone rang. The entire system had crashed, he was told. It was January 24, 2000. 

While it was 7:00 P.M. at NSA, it was midnight deep within the computers, which operate on Greenwich Mean Time. For some reason, at that moment a piece of software malfunctioned, setting off a systemwide shutdown. "It was the whole net by which we move, use, abuse, process—everything we do with information here at Fort Meade went down," said Hayden. "Everything on the Fort Meade campus went down. Everything." 

The director ordered an emergency response. Computer scientists, electrical engineers, mathematicians, anyone who could shed light on the problem was told to report in. " 'What do I tell the workforce?' " Hayden said he thought. "I called [Director of Corporate Communications] Bill [Marshall] in here and I said, 'Bill, I need a concept; we need to communicate this to the workforce. What should we do?'" Marshall suggested a town meeting. "And that's exactly what we did." Taking to the stage in the Friedman Auditorium, Hayden warned everyone not to say a word about the crash. "I said the fact that we're down is an operational secret," Hayden recalled. "Our adversaries cannot know that our intelligence capabilities have been crippled." 

On the second floor of the Tordella Supercomputer Facility, scientists pulled apart spaghetti like mazes of multicolored wires, covered desks and floors with unwieldy schematics and wiring diagrams, and probed, inch by inch, the computer's nervous system. 

To Hayden, the crash came as a shock—especially because only three weeks earlier, on New Year's Day 2000, he had successfully dodged the Y2K bullet. But for nearly a decade, pressured by ever-increasing demand and overuse, NSA's brain had been heading for a stroke. The first signs appeared in the early 1990s, when it became obvious that the agency's massive system for processing, storing, and distributing Sigint— codenamed Universe—had become technologically outdated. Universe required 130 people to administer, took up 20,000 square feet of floor space, and ate up enormous amounts in operations and maintenance costs. 

In an effort to replace Universe before it crashed, a new system was developed in 1993 that used standard workstations, servers, and supercomputers. Codenamed Normalizer, the new system took up 15,000  fewer square feet of floor space, saved $300,000 a year in costs, and cut the number of people needed to operate it to just ten. But as the system became smaller, the demands placed on it grew exponentially. Delivery time for processed Sigint, for example, was shrunk from more than an hour to only ten minutes. Given such pressures, an electronic aneurysm was inevitable—and the most vulnerable time was millennium eve. In addition to performing its normal hefty workload, the agency's computer system would also have to figure out that switching from 99 to 00 meant moving ahead to 2000, not behind to 1900. 

In the weeks leading up to the new century, Hayden ordered that contingency plans be developed "to maintain continuity of operations of our critical intelligence mission" in case of a massive crash. His predecessor, Lieutenant General Kenneth A. Minihan, had called the Y2K problem "the El Nino of the digital age." In August 1998 he said, "As each day passes we are coming closer to the date of one of the largest technological and managerial challenges ever faced by our workforce." 

As early as October 1996, the agency had set up the Millennium Program Management Office, later named the Year 2000 Oversight Office. NSA also began demanding that, as a prerequisite of doing business with the agency, vendors state in writing that their products contained no Y2K problems. Charged with coming up with a solution was Ronald Kemper, NSA's chief information officer. Desperate for staff who could help repair the millennium bug, the agency implemented an "Emergency 911" operation to quickly find and recruit people with critical knowledge of some of the older and more obscure computer languages. Incentives were offered. General Minihan promised money bonuses and time off. 

By 1998, however, agency officials were discovering that many companies that early on claimed to be Y2K compliant were suddenly retracting their words. "In some cases," said one NSA report, "the Agency may not know there is a problem until something breaks." Said Minihan: "Solving the Y2K problem is a tedious job and we are fighting a battle against a deadline that will not move under any circumstances." 

As the date approached, the systems governing the agency's thousands of computers were assessed and stickers were placed on the terminals. A green "Y2K OK" sticker indicated that the system would pass over the threshold without problem; a yellow sticker marked systems concerning which there was still some question, and a red sticker warned, "Y2K NOT OK." 

Less than a year before the critical date, NSA was still behind schedule. Only 19 percent of the agency's computers were ready, and repairs on nearly 60 percent were late. But as a result of a crash program, computer programmers managed to bring 94 percent of the computers into compliance by July 1999. The remaining 6 percent were  expected to be ready by the end of September. Ultimately, as in most of the world, the millennium's arrival caused little or no disruption to NSA's powerful computers and software; the agency continued to eavesdrop as though nothing had happened. Until January 24. 

Finally, after the agency spent thousands of staff hours and more than $3 million on repairs, the system was patched together. After three days, NSA awoke from its electronic coma, its memory still intact. "We had the ability to store that which we collected over this three-and-ahalf-day period," said Hayden. "When we were able to go back and process the information when that capability came back, it took eight to twelve hours to process and analyze the information that we had collected." During the outage, much of intercept traffic that would have normally gone to NSA shifted instead to GCHQ. "We covered the whole thing for them," said one GCHQ official, "to their acute embarrassment." 

A year after the crash, with computer management now more centralized, NSA's brain was again functioning normally, at about 12 to 15 percent of capacity. Nevertheless, Hayden concluded, "The network outage was a wake-up call to our stakeholders and us that we can no longer afford to defer the funding of a new infrastructure. And the challenge doesn't stop there." 

With his pudgy face, rimless glasses, and hairless dome, Hayden more closely resembled a John Le Carré spymaster than an Ian Fleming secret agent. He also lacked the background of the stereotypical super-high tech spy chief. Shortly after his arrival on the eighth floor of OPS 2B, he told his staff that arithmetic had never been his best subject. "I'll state right up front," he admitted, "I am not a mathematician or a computer scientist and I won't pretend to be one. I will be relying heavily on all of you who are." To make the point, he added, "When I think about the intellectual and mathematical brainpower that comes to work here every day, I can recall the same intimidating feeling I experienced as a child when Mrs. Murphy introduced me to the times tables in the second grade." 

Born on March 17, 1945, Hayden grew up in Pittsburgh. In college and graduate school at Duquesne University he avoided hard math and science courses and instead studied history. During the height of the antiwar era, the late 1960s, Hayden excelled in ROTC, becoming a Distinguished Graduate of the program. He entered the Air Force in 1969, shortly after finishing his master's degree in history, and was assigned as a briefer at Strategic Air Command headquarters at Offutt Air Base in Omaha, Nebraska. Two years later he was assigned to Guam as chief of current intelligence for the headquarters of the 8th Air Force. He spent the last half of the 1970s at various schools, mostly teaching ROTC at St. Michael's College in rural Vermont. 

In June 1980 Hayden, newly promoted to major, was sent to Osan Air Base in South Korea as chief of intelligence for a tactical fighter wing. Two years later it was back to the good life again, as a student and then, in Sofia, Bulgaria, as air attaché. From there Hayden moved into a policy job in the Pentagon and then over to the Bush White House, on the National Security Council, until 1991. After an intelligence assignment at U.S. European Command Headquarters in Germany, he took over the Air Intelligence Agency and became director of the Joint Command and Control Warfare Center at Kelly Air Force Base, Texas. There he became heavily involved in the concept of information warfare. Finally he was made deputy chief of staff for the United Nations Command in South Korea, where he dealt with the issue of missing servicemen from the Korean War. 

Hayden was in Korea when he secretly received word of his new assignment to NSA. Shortly afterward, on a Friday night, he went to the base movie theater with his wife. Playing was a film he had not heard of, Enemy of the State, in which Will Smith plays an average citizen eavesdropped on by NSA, and Gene Hackman plays a retired NSA official worried about the agency's enormous power. 

"Other than the affront to truthfulness," said Hayden, "it was an entertaining movie. And I will tell you, I walked out of there saying, you know, that's not a good thing, to portray an agency so inaccurately. But I'm not too uncomfortable with a society that makes its bogeymen secrecy and power. That's really what the movie's about—it was about the evils of secrecy and power. Then they tacked NSA on, that was the offensive part. But making secrecy and power the bogeymen of political culture, that's not a bad society."[And just what the hell does he think he is involved in up to his eyeballs? That is the typical mindset of the useful idiots  of the shadow lords and their curtain of tyranny they have thrown over the country over the last 40 years.DC]

When Hayden arrived at Crypto City, it was under siege. Congress was lobbing mortar rounds. Morale was lower than a buried fiber optic cable. Senior managers had become "warlords," locked in endless internecine battles. "The term 'warlordism' has been going around for years," said one NSA official. "It means that each deputy director acts like a feudal warlord in a fiefdom. He will not give up anything for the greater glory of the NSA mission. If we have something that requires taking some of my stuff and putting in another deputy directorate, I won't do it. It's like rearranging the deck chairs on the Titanic. The directors are, by and large, afraid to tell the deputy directors to leave. They feel perhaps unsure of themselves." The deputies, he added, "tend to stake areas out like dogs marking their territory." 

Another problem was that the Senior Policy Council, which advised the director on major issues affecting NSA, comprised so many feuding  "warlords" that to reach agreement on anything was impossible. "I don't know how anything gets done," said one member of the council. "There are thirty-five of us in that room and we don't get anything done. Anybody who was anybody was on the damn leadership team. It was impossible for the director to get a consensus on anything." 

Hayden also arrived to find the agency's financial system in shambles. "The budget is one of his biggest problems," said an official in January 2000. "He doesn't know where it is, he can't account for it, that's what's driving him nuts." Adding to the management problems were the enormous technical challenges facing the agency at the dawn of the new century. 

Hayden candidly admitted that at stake was nothing less than the survival of NSA. "As an agency, we now face our greatest technological and analytic challenges—diverse and dynamic targets; nontraditional enemies and allies; a global information technology explosion; digital encryption; and others. Make no mistake, we are in a worldwide competition for our future." 

Hayden had been at NSA less than a year when the computer crash came. It likely confirmed the worst predictions he had been hearing about his agency's failing health. "The NSA used to have the best computers in the world, bar none," said an official who had been briefed on the crash. "Now they can't even keep them running. What does that tell you? Do you know a modern company that goes off-line for four days? They're struggling." 

The agency that once blazed the trail in computer science, going where the private sector feared to go or could not afford to go, was now holding on to technology's tail for dear life. "Most of what they were expert in is no longer relevant," said a former director. "Getting them to embrace the new world has been traumatic. . . . All they're trying to do is hang on and survive." Florida congressman Porter J. Goss, one of those who did see the computer crash coming, was more blunt. "Believe me," he said, "it's patch, patch, patch out there. We no longer are capable of doing what we used to do." Goss also said, "This should have come as a surprise to no one. Indeed, the [House Intelligence] Committee has, for at least three years, warned NSA and the intelligence community of concerns in these areas." 

"Signals intelligence is in a crisis," said House Intelligence Committee staff director John Millis more than a year before NSA's crash. Like a worried first mate seizing the ship's wheel from a captain who is headed for the shoals, the committee began forcing change on NSA. Both Millis and Goss had served for about a dozen years in the CIA's Operations Directorate. Millis had also spent some time in the executive offices of NSA. Now the two teamed up to reinvigorate NSA's sensitive Sigint  operations. 

"We have been living in the glory days of Sigint over the last fifty years, since World War II," said Millis. "Sigint has been and continues to be the 'int' of choice of the policymaker and the military commander. They spend about four or five times as much on it as they do on clandestine collection, and the fact of the matter is, it's there quickly when needed. It's always there. Or it has always been there. In the past, technology has been the friend of NSA, but in the last four or five years technology has moved from being the friend to being the enemy of Sigint." 

In the past, a major communications revolution—telephone, radio, television, satellite, cable—might happen at most once every generation. The predictable pace gave NSA time to find new ways to tap into each medium, especially since many of the scientists behind the revolutions also served on NSA's secret Scientific Advisory Board. Today, however, technological revolutions—PCs, cell phones, the Internet, e-mail—take place almost yearly and NSA's secret advisers no longer have a monopoly on the technologies. "Increasingly," said Mike McConnell, the NSA's director from 1992 to early 1996, "we will have to deal with a much more diverse electronic environment, cluttered not only with human communications and sensor signals, but also with machines speaking to other machines." 

One major problem confronting NSA is a change in the use of technologies throughout the world. Some of NSA's targets still use traditional methods of communications—unencrypted faxes and phone calls, transmitted over microwaves and satellites. As can be seen from the intercepts surrounding Iran's attempt to acquire the C-802 missile, NSA is still very capable of performing its mission on these technologies. But other targets are switching to far more complex communications systems—circuit encryption, fiber optics, digital cellular phones, and the Internet. The problem is to spend the vast amounts of money, time, and expertise needed to develop ways to penetrate the new systems, and yet not to overlook the old ones. 

"We've got to do both," said Hayden, sitting in his office. He had walked into the middle of the problem when he joined the agency. "Do more without giving up what you used to do. . . . Part of the world looks like this now and is moving hell bent for leather in that direction, but in this different part of the world it still looks like it did fifteen years ago. And things of interest are happening to the United States in both universes. . . . How do you do the new while the old is still important to you—in a budget that doesn't allow you to create two Sigint systems, one for the old, one for the new? You've captured the precise dilemma of this agency."

Deputy Director Barbara McNamara outlined in stark numbers another of NSA's key problems today: too much communication. "Forty years ago there were five thousand stand-alone computers, no fax machines, and not one cellular phone. ... In 1999 there were over 420 million computers, most of them networked. There were roughly 14 million fax machines and 468 million cell phones and those numbers continue to grow. The telecommunications industry is investing a trillion dollars to encircle the world in millions of miles of high bandwidth fiberoptic cable." McNamara might have added that there were also 304 million people with Internet access in 2000—up 80 percent from just the year before. And for the first time, less than half of those people live in North America. 

Not only is NSA spreading itself thin attempting to listen in on ever expanding modes of communications, the tasks assigned to it by the White House, CIA, Pentagon, and other customers are also exploding. In 1995, the agency received about 1,500 "immediate" requests for intelligence—known as ad hoc requirements. By the fall of 2000, the number of such requests had already grown to 3,500—a 170 percent increase. Analysts, said one senior NSA official, "brute force" their way through massive amounts of information. 

The problem is not just interception of ever-increasing quantities of communications, it is moving the information back to NSA. "Well, what are all these communications you're going to bring back to the building and process?" asked a senior intelligence official involved in Sigint. "You've got to have a pipeline to bring them back. You've got to have bandwidth, which is expensive, and which is limited. It's finite. You can't just get all the bandwidth in the world and ship everything back here. So you've got a physics problem. . . . You've got to get a real big pipe and there is no such big pipe that exists." 

Even if the avalanche of signals could successfully be diverted back to Fort Meade, there would never be enough people to process it all. "Supposing you pipe every communication that goes on in China back to the United States," said the senior Sigint official. "Then you've got to have somebody process it. You've got to have a linguist listen to it. And the chances of your ever digging out from under the pile of information and finding what's important [are] miniscule. . . . You don't have the linguistic resources to deal with that kind of problem." 

The answer is using powerful computers to filter as much intercepted information as possible at the front end—the point of interception—such as at Menwith Hill Station, NSA's massive satellite listening post in central England. "You've got the antenna," said the senior Sigint official, "and now, next to it, in a building, you've got the filter. . . . You filter it by finding out some identifier of a person or an entity that will allow you to pick off that person's communications and throw away everybody else's. You're going to run some identifier in the message against a category of identifiers that you have in a dictionary [computer] somewhere." 

One such identifier, he said, is the target's telephone number. "And what you're looking for is a communication going to that telephone number. So in comes a dialed number that's a different dialed number— [the filter] ignores it, goes away until it hits on one. . . . All we're doing is we're comparing the communications that are out there against a target list, and if they don't hit, nothing ever happens to the ones that get rejected. You don't see them, they don't get stored. . . . The stuff that does hit goes to an analyst—maybe they're back here [NSA headquarters] someplace—to look at it. ... Reality of life is that you're talking about a small percentage of everything out there that even gets vacuumed. ... So what I'm saying is that there's a first cut. You've got to decide where you're going to vacuum." 

Given this burgeoning increase in worldwide telecommunications now confronting NSA, concern has been growing in Congress. Some believe that NSA, through years of mismanagement, is depending far too heavily on the old, reliable systems while failing to prepare for the tidal wave of new technologies now beginning to crash down on the agency. Barbara McNamara candidly agrees. "So far," she said, "the National Security Agency is lagging behind." 

High on NSA's worry list is the shift from microwave and satellite communications—whose signals NSA was adept at capturing with its eavesdropping satellites and ground-based stations—to buried fiber optic cables. "Technology has now become a two-edged sword," said Hayden. "On the dark days it has become the enemy." 

According to a senior NSA official, by the fall of 2000 only 2 percent of AT&T's voice and data communications were transmitted over microwave towers in the United States. And AT&T had virtually given up on domestic satellite communications, except for Alaska. Instead, it is selling its satellite voice and data circuits to the rapidly growing direct-TV industry. "AT&T invested very heavily in the '70s in satellites in order to move great volumes of information," said the official. "Right now AT&T is selling off all of their domestic satellite coverage. . . . There's a lot of change going on here, and a Sigint enterprise has to look like that which it targets." 

By turning instead to buried fiber optic cables, said the senior NSA official, AT&T was able to double its capacity in just ninety days. Made up of bundles of tiny, hair-thin glass strands, fiber optic cable offers greater volume, more security, and higher reliability. Thus, where satellite communications are as easy to collect as rain, fiber optic signals require the skills of a mole. 

So worried was NSA about the difficulty of eavesdropping on fiber optics that in the early 1990s it fought against export of the technology to Russia. For example, the United States denied an export license to US West, Inc., for a proposed trans-Siberian cable project. Now NSA must deal with a second, far more sophisticated generation of fiber optic technology. 

Greater and greater volumes of material—from 400-page books to megabyte-hogging animated graphics to full-length movies—are being shoved through the narrow straws that make up the communications networks. Says MIT's David Clark, "The ability to get bits down a fiber is growing faster than Moore's law," which predicts that computer power will double every eighteen months. The carrying capacity of fiber, said Clark, is doubling every twelve months. 

Scientists are now developing methods to greatly multiply the numbers of fiber optic channels in existing cables while at the same time rolling out miles and miles of new cable. The new technology, known as wavelength division multiplexing (WDM), consists of sending multiple signals down the same straw at different wavelengths. The technique has been called the fiber optic equivalent of parallel processing. By 2001 WDM had become a $4 billion business, and fiber optic cable was flying out of factories as if tied to a speeding harpoon. According to John MacChesney, an optical fiber pioneer at Bell Labs, the factories were "producing hundreds of kilometers of fiber drawn to precise dimensions at a rate approaching sixty miles an hour." At the same time, the production costs had dropped from $1 a meter in 1980 to about $.05 a meter in 2001. 

One such system is known as Project Oxygen, so called because it is an attempt to breathe new life into an old technology. If signals are sent at sixteen different wavelengths through each of four pairs of optical fibers, information can be transmitted through a single transatlantic cable at 640 gigabits per second—the equivalent of 10 million simultaneous telephone calls. 

In 1998 Lucent Technologies unveiled its new WaveStar OLS 4006 system, which it claimed could carry over a single strand of fiber the equivalent of the entire Internet. Its speed was such that it could also transmit the equivalent of over 90,000 encyclopedia volumes in one second. The company achieved this capability by using what it called ultra-dense WDM. "Leapfrogging current competitive offerings," said the company, "Lucent's new optical networking system can be configured to handle up to eight fibers, each transmitting 400 gigabits per second, to give communications providers a maximum capacity of 3.2 terabits (or 3.2 trillion bits) per second of voice, video and data traffic." 

AT&T was to be the first customer for Lucent's new system, and by 2001 the company had signed contracts with firms in Europe and Asia.  Among them were the Netherlands' KPN Telecom B.V., Spain's Telefónica de España, Korea Telecom, and even China's Posts and Telecommunications Administration. 

The system was designed by Lucent's subsidiary Bell Labs, which for many years has had a very close and very secret relationship with NSA. For two decades William O. Baker served on NSA's Scientific Advisory Board. At the same time he also served, at various points, as research chief, president, and chairman of the board of Bell Labs. The first operational fiber optic system was developed under Baker at Bell Labs. Among the members of what is now the NSA Advisory Board are former State Department official Arnold Kanter; former DIA director Lieutenant General James Clapper; and James Adams, chairman of iDefense, Inc. The executive secretary is NSA's David P. Kokalis. 

NSA has also joined with Lucent and a number of domestic telecommunications companies, including Verizon, to form a consortium called Multiwavelength Optical Networking (MONET). MONET will research advanced fiber optic techniques, including routing/switching and optical monitoring. 

In 1998, the first large submarine cable designed for multiwavelength operation was turned on. It forms a loop connecting the United States with Britain, the Netherlands, and Germany. When the newer WDM technology is in place, its capacity will be more than 1,000 times greater than that of the first fiber optic cable, which began service only about a decade earlier. Engineers are planning to lay 168,000 kilometers of the cable, enough to circle the earth four times. More cable will be laid by other companies. Said David Clark of MIT, "We're going to drown in fiber." 

Another problem facing NSA is the growing difficulty of tapping into the Internet—a series of complex, interconnected communications lines that encase the earth like a tangled ball of sewing yarn. Every one hundred days the Internet doubles in size. Also up is voice traffic, which increases in volume at 20 percent a year. This is largely as a result of new digital cellular communications, which are far more difficult for NSA to analyze than the old analog signals. Rather than consisting of voices, the digital signals are made up of data packets that may be broken up and sent a myriad of different ways. "Today you have no idea where that information is being routed," said one intelligence official. "You may have somebody talking on a telephone over a land line and the other person talking to them on a cell phone over a satellite. You don't know how it's being routed, it's going through all kinds of switches, the information is not where you think it is, and that's what has created the complexity and that's what we have to figure out how to deal with." 

"The mere fact of digitizing the signals gives it some level of protection," said one former NSA official. "But if you really hit it with a hard encryption system, digital encryption, it's a forget-it situation." 

Encryption was once an area where NSA held a monopoly. But after a disastrous period during the 1990s when the agency attempted to outlaw the export of powerful encryption software, it has now virtually given up. "Crypto policy is the wave of the past," said former NSA general counsel Stewart Baker. To worry about encryption sales was like locking a door on a house without walls. Restricting American sales would do nothing to prevent foreign nations from selling equally powerful encryption tools. "No matter what we do, encryption is here and it's going to grow very rapidly," said John Millis. "That is bad news for Sigint, so it is going to take a huge amount of money invested in new technologies to get access and to be able to break out the information that we still need to get from Sigint." According to one senior NSA official, in the fall of 2000 only 10 percent of communications were encrypted. But for NSA, the projections were frightening. Within seven years, he estimated, fully 85 percent of all communications will be hidden in complex ciphers. 

As a result of the House Intelligence Committee's push to focus attention on NSA's problems, news reports began painting the agency as losing its hearing. "Difficulties posed by new technologies also threaten to make the NSA's 'big ears' increasingly deaf," said one report, on CNN. A headline in Newsweek read: "Hard of Hearing," adding, "The National Security Agency has fallen behind in the high-tech battle against terrorists, hackers and other threats." 

Although life may be somewhat more complicated for NSA, and eavesdropping may become even more difficult years down the road, much of this criticism is overblown. The agency is certainly not going "deaf" today—a point made by Michael Hayden. "One criticism is that we're omniscient and reading everybody's e-mail," he said, "and the other is that we're going blind and deaf. It can't be both." 

According to information obtained for Body of Secrets, NSA has managed to find ways to tap into all of these new technologies—including fiber optic cables—and is pulling in more communications than ever. This was revealed in a highly classified closed-door discussion at NSA on September 30, 1999, between NSA Deputy Director for Services Terry Thompson and members of the agency's technical workforce. 

"The projections that we made five, six, eight years ago," said Thompson, "about the increasing volumes of collection and what that's going to mean for our analysts have all come true, thanks in large part to the work that you-all and others have done. We're much further ahead now in terms of being able to access and collect network data, fiber optics, cellular data, all the different modalities of communications that we are targeting, and that results in a lot of output for our analysts. Our tools are coming along okay to help process and reduce the backlog, but there's still a huge requirement for human beings at the end of the day to figure out what's important, and that boils down to language work and IA [intelligence analysis] work." 

Thompson explained how NSA breaks into the Internet by hiring people who have special knowledge of key U.S. companies that make critical components for the network. With their help, the agency reverse engineers the components in order to eavesdrop on the systems. Among the most critical components of the Internet are routers made by Cisco Systems, a California company. These are specialized microcomputers that link two or more incompatible computer networks. They act as a sort of postal service, deciding where to route the various messages carried over the network. "Virtually all Internet traffic travels across the system of one company: Cisco Systems," says a Cisco television ad. By discovering the weak spots and vulnerabilities in this "postal service," NSA can target and intercept much electronic mail. 

During the discussion with the technical workforce about short-term hiring by NSA, Thompson said, "If you can see down the road two or three or five years, and say, Well, I only need this person to do reverse engineering on Cisco routers, that's a good example for about three or five years, because I see Cisco going away as a key manufacturer for routers and so I don't need that expertise. But I really need somebody today and for the next couple of years who knows Cisco routers inside and out and can help me understand how they're being used in target networks." In fact, NSA recently recruited a Cisco engineer to be the top technical adviser to its new transformation office, which is charged with moving the agency forward in the new century. 

As communications shift from satellites to fiber optics, NSA may have to return to tapping undersea cables—if it hasn't already done so. But now, instead of copper cables connecting parts of Russia, the targets may be major commercial WDM fiber optic cables connecting continents. And instead of the USS Halibut, the new cable-tapping submarine may be the USS Jimmy Carter, called the most advanced spy sub ever built, which is due to be completed in 2004. In December 1999, Electric Boat was awarded a $887 million contract by the Navy to extensively modify the Jimmy Carter for "surveillance, mine warfare, special warfare, payload recovery and advanced communications." When completed, said a source quoted in the Los Angeles Times, the Seawolf-class sub "will be able to place and recover top-secret 'pods' that will tap undersea fiber-optic cables for the first time." 

To cope with what Michael Hayden referred to as "the massive volume of stuff" flowing into NSA every day, the agency plans to "move processing more forward in our process so that you're not moving raw unprocessed stuff—so much so far."

That may mean giving more responsibility to NSA's three large Regional Sigint Operations Centers (RSOCs). The Medina RSOC, located at Medina Annex in Lackland, Texas, focuses on the Caribbean and on Central and South America. The second, in an underground bunker at Kunia, Hawaii, focuses on Asia. And the third, at Fort Gordon, Georgia, processes and analyzes intercepts from Europe and the Middle East. Manned jointly by NSA and its three military Sigint organizations, the RSOCs were set up to consolidate on U.S. territory much of the intercept activity that was previously done at the scores of worldwide listening posts. Much of the Sigint flowing into these centers comes from satellites and remotely operated stations. 

Another problem created by the rapid changes in worldwide communications technology is how to design the newest Sigint satellites to target these systems. The enormously expensive eavesdropping birds may be programmed in 2001 for a system or technology that becomes obsolete by 2003. "We spend more money on one satellite in one year than we do on all the analytic capabilities combined," said John Millis. "It doesn't make a lot of sense doing Sigint from there anymore. Excepting Elint, you shouldn't be spending one dollar more than we do to try and intercept communications—regular voice and data-type communications—from space. But we do make that investment. This is something that we think that we have to move away from." The change in philosophy is revolutionary in an agency that, since the late 1950s, has moved nonstop toward space. 

Because of the change, there have been repeated delays in completing the next generation of NSA satellites, called Integrated Overhead Signals Intelligence Architecture—2 (IOSA-2), while experts attempt to decide which collection systems would be best. Originally the National Reconnaissance Office, which builds NSA's satellites, said the new Sigint constellation—a constellation is several satellites operating in concert— would be defined by the end of 1999 and acquisition would begin about 2002. But now it appears that because of "the magnitude of the job," the first systems will not be operational before 2010. 

These are all areas where the House Intelligence Committee is attempting to throw NSA a financial life buoy. "NSA now faces new, more robust challenges, thanks to the explosion of the technology and telecommunications industries," said its chairman, Porter Goss, in 2000. "Each type of communications—radio, satellite, microwave, cellular, cable—is becoming connected to all the others. Each new type of traffic shows up on every type of communication. Unfortunately, as the global network has become more integrated, NSA's culture has evolved so that it is seemingly incapable of responding in an integrated fashion." Tim Sample, who became staff director on Millis's death in June 2000, minced no words in a talk to a group at NSA. He made it clear that for  years NSA's leadership had simply ignored the agency's many problems. Some on the House Intelligence Committee have been especially critical of Barbara McNamara, a member of the agency's old school, who was deputy director up until June 2000 and is now NSA's liaison officer to England. "There was an attitude of, We'll do it ourselves, thank you very much," said Sample. "We understand that there are some changes, but we've been doing pretty well with what we've been doing, thank you. We'll keep going." Sample assessed NSA's management problems harshly: 

When it came to Sigint, we turned to NSA and we got a lot of resistance. There was an issue of financial accountability, and that was at best elusive. There was a sense of protecting fiefdoms—and again we understand, we were hunkering down here, for God sake, Congress is coming, don't let them cut us again. We saw multiple efforts at projects throughout the organization that in some cases were duplicative, and were done more in the sense of the bureaucracy is not quite working for me, I'll do it internal to my organization and that way something might get done. Or there was a sense of ownership within each organization. 

We saw, we believe, that the agency was too insular. It was that sense of we can do everything internally. It was a sense of protection of people—which isn't bad, as long as it's mixed with what kind of people do you need for the future. What skill mix do you need to have. And then you help your workforce get there. 

From a management standpoint, we saw a major protection of bureaucracy. Many managers, especially at the more senior levels, didn't accept the writing on the wall. Not just the Congressional writing on the wall, but the intelligence, the target writing on the wall. That somehow in our view, some of the management lost touch with the workforce. And one of the most rewarding things I think I've seen in the last four or five years is, if you dive down into the workforce, the young people that have gotten into this game. They have the same infection that almost all of us have had when we started our careers in intelligence. It's a sense of patriotism, it's a sense of accomplishment, it's a sense of protecting national security. And many of them, we thought—and not just NSA but other agencies—were scratching their heads trying to figure out where are we going? And that was important to us. So we're on a defensive posture instead of an offensive one. 

There was—and I know I'll probably get a lot of people upset at this one—but there really was a philosophy of feel better. Let's do some things to feel better about where we are. And one of those areas was—without taking swipes at it, because it was important—but one of the areas that was emphasized was management awards. And I'm fully supportive of rewarding people and of having agencies rewarded for their efforts, of how they manage people and how they manage organizations and how they do things. It is an important part of life. It is an important part of human value. It is not the most important part of intelligence. But that's not the feeling that we had. We got the feeling that that was a big priority. 

And if you think I'm making this up, let me tell you one of the phone calls that I got, that I will never, ever, forget. And I will not tell you who called me. I will just tell you that this individual was at the senior levels of NSA. And we were about to produce a bill, and we were about to send it out the door, and I got a phone call one morning—and this individual said, "Tim, whatever you write, would you do me a favor and not put it in the public bill." And I said, "Why? It's unclassified." And the response was, "Because we're in line for some management awards and if the media sees that, it may ruin that opportunity." To us, that spoke volumes. To us that said that many of the managers, including the senior managers, were not quite with the picture, in our view. 

And what we said basically was we see a lot of management and very little leadership. And there is a major difference. And we said that we saw a lot of people trying to do a lot of good work, but that Sigint in the future was in peril. And they were fairly harsh words, and they got a lot of people upset, though my sense is for those in the workforce, there was a lot of head shaking up and down, going, Yeah, how do we fix this. And I will say this now, and I will say it again and again, the issue here was facing change. 

Asked in 2000 whether he believed Congress was attempting to micromanage NSA—take over command of his ship—Hayden was diplomatic. "Not Congress," he said. "We have occasionally skirmishes with particular staffers, and those are honest differences of opinions. I've got a natural inclination to think they're too detailed. We have a fair amount of attention from Congress. . . . That's a good thing. What I communicate to the workforce is: that says that what we do is important, they're paying attention. 

"Now the dark side of that is they may have views on some things that we're doing that we don't totally agree with. We'll get over it. The important thing is that they care, and actually I have used that with the workforce. I say we occasionally get the harsh words from our overseers. Even when it's the harsh word—I'll tell you the exact metaphor I used. You're watching somebody's kids playing down the street a little bit out of sight, and they're soaping somebody's car windows. You kind of get a little smile on your face—till you suddenly realize it's your kid. And what happens then, you run out, you grab him by the ear, and you bring him back in. That's a little bit like us and Congress. If they didn't care about us, they wouldn't be making these statements that occasionally make us less comfortable or embarrassed or feel that it's unfair criticism and so on. But the underlying point is ... how important [Congress] thinks the agency is." 

"I think in the history of the agency, we were never a big player downtown," said one NSA official. "Until Bobby Ray Inman. Bobby Ray knew how to manipulate and he knew how to punch the buttons and he knew how to ingratiate himself, and he had a reputation, and it was well earned, as a straight shooter. But the problem was nobody else in the agency knew how to do that. And they saw what he was doing but they didn't understand how he was doing it or why he was doing it. So they thought, If we ingratiate ourselves downtown, if we train our people to respond to congressional inquiries, that this is okay. We'll figure out how to do it. But they don't understand how to deal with Congress. I think part of it is that the directors they brought up are political clowns, klutzes, they don't understand how to deal with politicians. They think that the aura of the agency will fake everybody out. And the problem is that song isn't being bought anymore downtown. You can't go down and say, 'Trust us' because it's no longer a question of secrets, it's a question of money." 

Realizing that NSA's very existence depended on reform, Hayden issued an edict: "Our agency must undergo change if we are to remain viable in the future." Nevertheless, he acknowledged that the attempt to move an iceberg like NSA would inevitably produce fractures and fissures. "There has been much discussion about this change," he told the residents of Crypto City, "much agreement that it is necessary, but some reluctance to take the actions to implement it." 

Like someone who had just inherited an old car, Hayden decided to call in the repairmen to explain what was wrong and offer suggestions on how to fix it. He put together two groups to take a close look at what makes NSA tick and directed them to write up report cards. One group was made up of nineteen middle-ranking insiders, the other of five outside experts on management. 

The insiders, known as the New Enterprise Team and led by the former deputy director for technology and systems, Jack Devine, were brutal in their criticism. Hayden jokingly referred to them as "responsible anarchists." "Absent profound change at NSA," they told Hayden, "the nation will lose a powerful weapon in its arsenal. . . . NSA is an organization ripe for divestiture: its individual capabilities are of greater value than is the organization as a whole. The legacy of exceptional service to the nation that is NSA is in great peril. We have run out of time." 

The team also made no bones about the source of the troubles: current and past leadership. Without naming names, they were clearly referring to then deputy director Barbara McNamara and past director Kenneth Minihan as well as their predecessors. "NSA has been in a leadership crisis for the better part of a decade," Hayden was told. "It is the lack of leadership that is responsible for both NSA's failure to create and implement a single corporate strategy, and for the complete breakdown of the NSA governance process. . . . These shortcomings have put us in dire straits. . . . Leadership has failed on multiple fronts. It has not provided a corporate vision or strategy. It has been unable or unwilling to make the hard decisions. It has been ineffective at cultivating future leaders. And despite a decade of criticism from stakeholders [Congress], it has failed to bring about real change. . . . Indeed, the workforce has carried the NSA institution on its backs for the better part of a decade." 

The team also described the climate within the thick walls and high fences in harsh terms, referring to "our insular, sometimes arrogant culture." 

Other criticisms included focusing on building bigger and better bugs while paying little attention to the needs of NSA's customers—the White House, Pentagon, CIA, and other users of Sigint. "[You] care more about technology than about the customer," one critic told the team. Another problem was duplication. 

The outside team was no less sparing in its candor. Among the criticisms was NSA's "slowness" in moving from old, comfortable targets, such as microwave interception, to newer, more difficult targets, such as the Internet. "Whatever the attractiveness of known targets and technologies," Hayden was told, "leadership must decide smartly when to move to more difficult but potentially more lucrative targets." 

Like its in-house counterpart, the outside team also criticized the agency's secrecy-driven culture. "Much of this can be attributed to the historic insularity of the Agency," they said, "which grew up in a culture of 'NSA doesn't exist and doesn't talk to people who don't work at NSA.' " At another point, the team noted "the 'Super Secret NSA' image ... is no longer useful to Agency needs." 

Again, much of the blame was directed at the current and former senior management, which cultivated not only a culture of excessive secrecy but also one of fear. "We are concerned the present mindset fostered a society where people were afraid to express their own thoughts," the outside team told Hayden. "Even though people spoke to us with true candor, they always wanted to avoid attribution because of the perception that the information was going to be used against them." Nevertheless, the employees made it clear that NSA was heading for the rocks. "The staff knows NSA is falling behind and is not properly addressing the inherent problems of the emerging global network," said the team, "and the present management infrastructure does not appear to be supporting the required changes." 

"In a broad sense," Hayden said, both panels painted a picture of "an agency that did not communicate with itself, or with others, well. Which—my view now, not theirs—is the by-product of a great deal of compartmentalization and insularity built up over almost half a century. A management culture that found it difficult to make the tough decisions, largely because the decisions were so tough." Also, he said, "They found that accountability was too diffuse throughout the agency. I've used the phrase, 'You damn near have to rent Camden Yards to get everybody that thinks he has a piece of the action in on a meeting.' Smaller team, which gives us a little more agility." 

Hayden immediately set about implementing many of the panels' recommendations. On November 15, 1999, he instituted "100 Days of Change," an ambitious plan to put many of the reforms into place in a little more than three months. At the same time, he sought to consolidate his power in order to blunt any opposition from the conservatives. "Even the best game plan," he warned, quoting legendary University of Alabama football coach Paul (Bear) Bryant, "ain't got no chance if the players don't execute it." So Hayden threw out the unwieldy senior management groups that held much of the power. The Senior Agency Leadership Team (SALT), the Critical Issues Group, and the Corporate Management Review Group vanished overnight. The one management group he kept, the Executive Leadership Team, he stripped to the bone, leaving only the director, deputy director, deputy director for operations, and deputy director for information security. 

To help correct the budget problems that caused so much grief for his predecessor, Hayden hired a chief financial manager, a first for NSA. Going outside the agency, he chose Beverly Wright, a Harvard MBA with a background in investment banking. At the time of her selection she was chief financial officer at Legg Mason Wood Walker, in Baltimore. Her job, according to Hayden, was to develop a management strategy for the agency and to "ensure that our mission drives our budget decisions" and not the other way around. 

He also ordered the personnel promotion process streamlined and even began taking the first baby steps to opening the door to the outside world a crack. Hayden would announce these fiats in agency-wide memorandums called DIRgrams. 

Finally, in June 2000 Barbara McNamara received her long-expected transfer to London, which paved the way for Hayden to name his own choice for deputy. Ironically, rather than pick a young lion to help set the course for the new century, he picked a retired agency employee who had started work at NSA even before McNamara. Tapped was William B. Black, Jr., an old hand with thirty-eight years of experience with the agency. But the last ten were no doubt the reason for his selection; they were spent in areas promising to be most important for NSA in the years to come. These included chief of NSA Europe from 1990 to 1993; chief of A Group, the Russian codebreakers, from 1994 to 1996; and then special assistant to the director for information warfare from 1996 until his retirement in 1997. He also served a tour as chief of the Special Collection Service, the covert joint NSA/CIA organization that specializes in worldwide bugging, black-bag jobs, and bribery in order to penetrate foreign communications facilities. Finally, because Black had worked as a senior executive with Science Applications International Corporation (SAIC), a major defense contractor, following his NSA retirement, he also brought some insight from the corporate world. 

By 2001 Congress was so pleased with the way Hayden was steering his ship away from the shoals that it was looking for ways to keep him in place for up to five years—two years over the normal three-year term. 

The rise of NSA's star since the end of the Cold War has been at the direct cost of the CIA and its dwindling ranks of clandestine officers. Human spies have proved no match when measured against the trusted rapid-response eavesdroppers at NSA. No love is lost between the two agencies; former NSA director William Odom, a retired Army lieutenant general, offered a caustic view of his agency's rival across the Potomac. "The CIA is good at stealing a memo off a prime minister's desk," he said, "but they're not much good at anything else." [They seem to be good at interfering with elections in America these days.DC] 

A former CIA director, Robert Gates, said that the Gulf War might have proved a Waterloo of sorts for the clandestine service: "Perhaps the most compelling recent example of the gap between our technical and human capabilities was the Persian Gulf War. U.S. military commanders had superb imagery and signals intelligence, but we had only sketchy human intelligence on Iraq's intentions prior to invading Kuwait, Iraq's ability to withstand sanctions, and the status of Iraq's weapons program." 

By 1998, the CIA had no more than ten or fifteen clandestine espionage operations active at any one time around the world, and the Directorate of Operations (DO), home of the spies, had shrunk to well below 1,000 officers. 

Reuel Marc Gerecht, an officer in CIA's clandestine service from 1985 to 1994, called into serious question not only the quality but even the veracity of much of the reporting by DO officers in sensitive parts of the world. Writing in the February 1998 Atlantic Monthly, under the pseudonym Edward G. Shirley, Gerecht called the DO "a sorry blend of Monty Python and Big Brother." "The sad truth about the CIA," he said, "is that the DO has for years been running an espionage charade in most countries, deceiving itself and others about the value of its recruited agents and intelligence production." By the mid-1980s, he noted, "the vast majority of the CIA's foreign agents were mediocre assets at best, put on the payroll because case officers needed high recruitment numbers to get promoted. Long before the Soviet Union collapsed, recruitment and intelligence fraud—the natural product of an insular spy world—had stripped the DO of its integrity and its competence." [But hey they are world class drug pushers.DC]

Gerecht complained that even in critical field positions, the agency paid little attention to matching skills to countries. "Not a single Irandesk chief during the eight years that I worked on Iran could speak or read Persian," he said. "Not a single Near East Division chief knew Arabic, Persian, or Turkish, and only one could get along even in French." Another former agency officer pointed out that the CIA teams dispatched to northern Iraq to assist the political opposition in the mid1990s "had few competent Arabic-speaking officers." 

"The CIA's spy service has become an anachronism," argues Melvin A. Goodman, a twenty-four-year veteran Soviet analyst of both the CIA and the State Department. Now a professor at the National War College, he gave a number of examples to show why the cloak-and-dagger spies have become an endangered species. "CIA sources failed to decipher Leonid Brezhnev's intentions toward Czechoslovakia in 1968, Anwar Sadat's toward Israel in 1973, and Saddam Hussein's toward Kuwait in 1990. . . . It's time," he concluded, "to jettison the myth that only clandestine collection of information can ascertain the intentions of foreign leaders." 

So far had the CIA's human capabilities dwindled by 1998 that it led House Intelligence Committee chairman Porter Goss—himself a former CIA case officer—to declare, "It is fair to say that the cupboard is nearly bare in the area of human intelligence." Over the 1990s, the CIA's staff was slashed by 23 percent and the agency's slice of the intelligence budget pie became a narrow wedge. When handing out about $27 billion to the intelligence community as part of the 1999 federal budget, Congress gave NSA a "huge increase,"  said one staffer, while leaving CIA's funding about level. A few weeks later Congress awarded an additional $1.5 billion in emergency supplemental funds. The technical spies received what one observer called "a windfall"—nearly $1 billion—while less than 20 percent went to the CIA's human agents. 

Robert Gates thought his agency should completely scrap its covert, paramilitary capability and make its analytic staff "much smaller." Noting the irony, the longtime head of the agency's Directorate of Intelligence pointed out in 1996, "I say that after having spent a good part of the eighties building it up!" 

Not only had CIA's status as an intelligence collection and covert action agency hit rock bottom by the end of the century, so had the director's role as chief of the entire intelligence community. Although in theory the CIA director is responsible for all U.S. spy agencies, Gates said that in practical terms this is no longer so. "We don't really have a Director of Central Intelligence [DCI]," he said in a CIA publication. "There is no such thing. The DCI at CIA controls only a very small portion of the assets of the Intelligence Community, and there are so many entities you don't have any director." 

Nor does the DCI have any real power over the community's purse strings. A commission on intelligence reform headed by former defense secretary Harold Brown and former senator Warren B. Rudman of New Hampshire noted in 1996 that the director of central intelligence controls only 15 percent of the U.S. intelligence budget. Two years later even that estimate had dropped. Speaking about the authority of the DCI, John Millis in late 1998 said, "It is very difficult to exercise authority over the National Foreign Intelligence Program and all its agencies because ninety percent of them are funded and owned and operated by the Department of Defense." That, in Millis view, has led to another problem: "an absolute and total fixation on near-term, tactical intelligence" at the cost of strategic—political and diplomatic—intelligence. "Since Desert Shield/Desert Storm," he said, "we have abandoned the strategic mission in large part to meet the pressing requirements the military has made for tactical intelligence." 

In an effort to rebuild the Clandestine Service, the CIA, in the late 1990s, began the largest recruitment drive for new case officers in its history. From 1998 to 1999 the number of job offers jumped 52 percent. Director George Tenet also directed the rebuilding of the CIA's overseas presence and the overhauling of the agency's clandestine training facility—"the Farm"—at Camp Perry near Williamsburg, Virginia. The number of clandestine and covert action specialists trained annually had dropped to less than a few dozen. But by 1999 the number of students, most of whom were between the ages of twenty-seven and thirty-two, had jumped to 120 and was expected to rise to 180 over the next few years. 

At an average cost of $450,000 to train a case officer, rebuilding the Clandestine Service is a significant investment. To further beef up the human spy capability, Tenet has allowed the Defense Humint Service, the Pentagon's human intelligence agency, to send its students to Camp Perry for training. 

Tenet made rebuilding the CIA into a significant intelligence agency his top priority. In a speech at Georgetown University in the fall of 1999, he clearly signaled that he preferred human spies over machines. "At the end of the day," he said, "the men and women of U.S. intelligence—not satellites or sensors or high-speed computers—are our most precious asset." 

In fact, the combination of human and machine spies may, in the end, save both. According to senior intelligence officials, in 1978 a covert joint intelligence organization was formed, which marries the clandestine skills of the CIA with the technical capabilities of the NSA. The purpose of this Special Collection Service (SCS) is to put sophisticated eavesdropping equipment—from bugs to parabolic antennas—in difficult to-reach places and to target key foreign communications personnel for recruitment. 

The SCS, whose headship alternates between NSA and CIA officials, is an outgrowth of the CIA's former Division D, established in the early 1950s by William F. Friedman's first employee, Frank Rowlett. Worried about competition from the upstart NSA, Allen Dulles hired Rowlett away to set up a mini-NSA within the CIA. At the time, Rowlett was upset because AFSA/NSA Director Ralph Canine wanted him to switch jobs, going from chief of Sigint to that of Comsec, the codemaking side of the business. "As it happened," recalled fellow pioneer Abraham Sinkov, "Rowlett was made quite unhappy by this suggestion; he wasn't very keen about moving over to Comsec, and he transferred to the CIA." (After about five years, Rowlett transferred back to the NSA.) 

Over the years the mission of Division D was to assist the NSA in stealing foreign cipher materials and recruiting foreign crypto clerks and communications employees. After Rowlett left in the late 1950s, the division was taken over by William Harvey, a balding, overweight, bug eyed veteran spook. Harvey had long been the CIA's link to NSA. In the 1950s he ran the CIA's Berlin tunnel operation, which succeeded in secretly tapping a key East German telephone network. [What a piece of work this fanatic was,in the 60's he was involved in the war against the hippies in the Haight-Ashbury scene when Charlie Manson was running around up there DC] 

In his work as chief of Division D, Harvey came up with a project known as ZR/RIFLE, which was designed to locate agents who could help him steal foreign code secrets and bribe cipher clerks. In longhand on sheets of yellow legal paper, he outlined the joint NSA/CIA operation: 

1. IDENTIFICATION: THE PURPOSE OF PROJECT ZR/RIFLE IS TO SPOT, DEVELOP, AND USE AGENT ASSETS FOR DIVISION D OPERATIONS. AGENTS WILL BE SPOTTED IN SEVERAL AREAS, INCLUDING THE UNITED STATES, BUT FOR OPERATIONAL SECURITY REASONS WILL PROBABLY NOT BE USED IN THEIR COUNTRIES OF RESIDENCE. PRESENT DEVELOPMENT ACTIVITY IS BEING CONDUCTED IN THE WE [WESTERN EUROPEAN] AND EE [EASTERN EUROPEAN] AREAS, BUT IT IS ANTICIPATED THAT THIS WILL BE EXTENDED TO OTHER DIVISIONS ALSO. THE PROJECT WILL BE OPERATED AGAINST THIRD-COUNTRY INSTALLATIONS AND PERSONNEL. 

2. OBJECTIVE: THE OBJECTIVE OF THIS PROJECT IS THE PROCUREMENT OF CODE AND CIPHER MATERIALS AND INFORMATION CONCERNING SUCH MATERIALS, IN ACCORDANCE WITH REQUIREMENTS LEVIED ON THE CLANDESTINE SERVICES, PRIMARILY BY THE NATIONAL SECURITY AGENCY. SINCE THESE REQUIREMENTS ARE SUBJECT TO FREQUENT REVISION, NO LISTING OF TARGETS WOULD BE VALID FOR THE DURATION OF THE PROJECT. SPECIFIC OPERATIONS WILL BE REQUESTED ON THE BASIS OF NEED AND OPPORTUNITY. THE PROJECT WILL BE CONDUCTED BY DIVISION D WITH ASSISTANCE FROM AREA DIVISIONS AND STATIONS AS NEEDED. 

3. BACKGROUND: IN RESPONSE TO THE INCREASING REQUIREMENTS FOR THE OPERATIONAL PROCUREMENT OF FOREIGN CODES AND CIPHER MATERIALS, DIVISION D IN 1960 BEGAN THE SPOTTING OF AGENT ASSETS AS A DEVELOPMENTAL ACTIVITY. DURING THE SAME PERIOD REQUIREMENTS FROM NSA BECAME MORE REFINED AND IN MANY RESPECTS MORE SENSITIVE. BECAUSE MOST STATIONS ARE NOT EQUIPPED TO CONDUCT THIS TYPE OF OPERATION AND BECAUSE OF THE DESIRABILITY OF COMPLETELY CENTRALIZING CONTROL OVER THIS ENTIRE EFFORT, IT WAS DETERMINED THAT DIVISION D, WHICH IS IN CLOSEST TOUCH WITH NSA ON PROCUREMENT REQUIREMENTS, COULD BEST CONDUCT THE ACTIVITY. 

Although ZR/RIFLE was designed to recruit "black bag" experts to break into diplomatic facilities in order to plant bugs and photograph cryptographic documents, in late 1960 a new mission was added. Besides engaging in burglary, Harvey was now told, ZR/RIFLE was to act  as cover for "executive action" operations. The unit would become the home of the CIA's assassination unit. Harvey, who carried a .45-caliber pistol wherever he went and enjoyed tough-guy assignments, seemed the right man for the job. And the joint NSA/CIA ZR/RIFLE project, buried deep within Division D, was the perfect place to hide the new capability. Eventually, however, the CIA's attempted assassinations were revealed during congressional hearings and such activities were later banned. 

Today, the SCS is the successor to Division D. As encryption, fiber optics, the Internet, and other new technologies make life increasingly difficult for NSA's intercept operators and codebreakers, the SCS has greatly expanded and become increasingly important. Its goal, like that of television's old Impossible Missions Force, is to find unique ways around problems. "Yesterday's code clerk is today's systems administrator," said one very senior CIA official. The easiest way to acquire many secrets is to get into foreign databases, and the best way to do that is to recruit—by bribery or otherwise—the people who manage the systems. Also, by bribing someone to plant bugs in the keyboards or other vulnerable parts of a computer network, NSA can intercept messages before cryptographic software has a chance to scramble them. 

The SCS is headquartered in a heavily protected compound of modern buildings on Springfield Road in Beltsville, Maryland, a few miles south of NSA. There, in what is known as the live room, the electronic environment of target cities is re-created in order to test which antennas and receivers would be best for covert interception. Elsewhere, bugs, receivers, and antennas are fabricated into everyday objects so they can be smuggled into foreign countries. "Sometimes that's a very small antenna and you try to sneak it in," said former CIA director Stansfield Turner. "Sometimes the signal you're intercepting is very small, narrow, [of] limited range, and getting your antenna there is going to be very difficult. I mean, under Mr. Gorbachev's bed is hard to get to, for instance." 

While on occasion NSA or SCS has compromised a nation's entire communications system by bribing an engineer or telecommunications official, often much of the necessary eavesdropping can be done from special rooms in U.S. embassies. But in difficult countries, clandestine SCS agents must sometimes fly in disguised as businesspeople. An agent might bring into the target country a parabolic antenna disguised as an umbrella. A receiver and satellite transmitter may seem to be a simple radio and laptop computer. The SCS official will camouflage and plant the equipment in a remote site somewhere along the microwave's narrow beam—maybe in a tree in a wooded area, or in the attic of a rented farmhouse. The signals captured by the equipment will be remotely retransmitted to a geostationary Sigint satellite, which will relay them to NSA. At other times, no other solution is possible except climbing a  telephone pole and hard-wiring an eavesdropping device. 

The SCS will also play a key role in what is probably the most profound change in the history of signals intelligence—the eventual switch from focusing on information "in motion" to information "at rest." Since the first transatlantic intercept station was erected on Gillin Farm in Houlton, Maine, just before the close of World War I, Sigint has concentrated on intercepting signals as they travel through the air or space. But as technology makes that increasingly difficult and prohibitively expensive, the tendency, say senior intelligence officials, will be to turn instead to the vast quantity of information at rest—stored on computer databases, disks, and hard drives. This may be done either remotely, through cyberspace, or physically, by the SCS. 

In a large sense, the changing philosophy represents the American spy world turned full circle, back to where the best way to get secrets is to steal them from where they are stored. Only now the storage site may be a single hard drive containing all the world's information.

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