The Insider

By John Liang
February 19, 2009 at 5:00 AM

President Obama made his first international trip today, jetting to Ottawa to meet with Canadian Prime Minister Stephen Harper. On the agenda were issues related to "responding to international security challenges," according to a joint statement released after their meeting:

The President and the Prime Minister agreed on the importance of Canada and the United States cooperating closely on a number of key international priorities for both countries, with a particular focus on Afghanistan which is a top priority for both countries and which will be a major subject of attention at the upcoming NATO Summit. The Leaders also agreed to work together closely in the Americas, including promoting effective discussion and meaningful results at the Summit of the Americas in April.

Our Foreign Ministers will meet in Washington next week, and Ministers of Defence the following week, to pursue a strengthened dialogue on these and other key international challenges.

By John Reed
February 18, 2009 at 5:00 AM

The Air Force is quietly resuscitating its long-dormant human-based intelligence corps, according to Maj. Gen. Paul Dettmer, the service's assistant deputy chief of staff for intelligence, surveillance and reconnaissance.

In the early 1990s the air service cut its human intelligence (HUMINT) division to focus on high tech spy satellites, planes, radars and other signals intelligence (SIGINT) platforms after the fall of the Soviet Union.

However, in the wake of 9/11, the Defense Department was directed to reinvigorate or even build “from scratch” human-based intelligence teams, according to Dettmer.

Over the last three years, the service has formed a much smaller cadre of HUMINT professionals focusing on getting the scoop on the latest technology being developed by air forces around the globe, said Dettmer during a Feb. 17 speech at an Armed Forces Communications and Electronics Association luncheon in Arlington, VA.

“We have a nascent program started with a small detachment at Wright-Patterson Air Force Base” in Ohio, said Dettmer. “Our intent is not to regrow the old Air Force Special Activities Center that did covert, clandestine interrogation and a bunch of other things that would duplicate HUMINT efforts that are done elsewhere in DOD.”

Instead, the service's HUMINT professionals will focus on the newest, most secret tools being used by foreign air forces.

The Air Force's new spies “will focus on niche requirements of Air Force warfighting -- in particular, where we are lacking is HUMINT-resourced intelligence focused in the scientific and technical realm,” said Dettmer.

This plan to focus Air Force spies on technology was prompted after the service's F-15 fighter pilots were given a serious run for their money by Indian pilots -- who were in some cases flying modified MiG-21s -- during the Cope India exercise in 2004, according to the two-star. (Click here for Inside the Air Force's superb coverage of that event, from June 2004.)

“The Indians had some capabilities we were just not aware of, and it kind of blew our socks off in the air-to-air domain,” said Dettmer.

Mark Bowden recently wrote an analysis piece about the future of American air power in The Atlantic that discusses among other things how the Indian air force modified its fleet of soviet and French designed fighters to successfully compete against Air Force F-15s during the Cope India exercise.

A small country can buy a MiG 21 on the world weapons market for about $100,000, put in a better engine, add more-sophisticated radar and jamming systems, improve the cockpit design, and outfit it with “launch and leave” missiles comparable to the AMRAAM. These hybrid threats are more dangerous than any rival fighters America has seen in generations, and they cost much less than building a competitive fourth-generation fighter from scratch. The lower expense enables rival air forces to put more of them in the air, and because the F 15 can carry only so many munitions, American pilots found themselves overwhelmed by both technology and sheer numbers during the exercises over India.

By John Liang
February 18, 2009 at 5:00 AM

Last week, we reported on the worldwide threats assessment presented by retired Adm. Dennis Blair, the new director of national intelligence, to the Senate Select Committee on Intelligence. In addition to the defense implications of the worldwide economic slump, we also touched on Blair's support for an international cyberwarfare "code of conduct" as well as his assessment of missile defense cooperation with Russia.

One aspect we didn't touch on was the national-security implications of worldwide climate change and other environmental issues, something that this week's issue of sister publication Defense Environment Alert focuses on. The issue's top article reports that Blair is reviving the term "environmental security" -- a Clinton-era term stressing the significance of environmental threats to national security -- as a focus for the intelligence community, suggesting it will receive higher priority as a national security concern than it was afforded by the Bush administration.

“Climate change, energy, global health and environmental security are often intertwined, and while not traditionally viewed as ‘threats’ to U.S. national security, they will affect Americans in major ways,” Blair said in Feb. 12 testimony to the Senate Select Committee on Intelligence. “The Intelligence Community has increased its focus on these . . . critical issues,” he added, noting the oil price spike last year that focused governmental attention on energy issues. . . .

Blair’s testimony appears to sidestep a brewing debate over whether threats from climate change should take precedence over energy security threats, which environmentalists have viewed as a key indicator of whether the Obama administration is willing to scale back support for high-emitting fuels as a way to address concerns about dependence on foreign oil.

Late last year, Obama suggested that climate change concerns may be a greater threat to national security than potential threats due to dependence on foreign oil. . . .

But in his testimony, Blair avoids prioritizing the two issues, noting threats from both. “The already stressed resource sector will be further complicated and, in most cases, exacerbated by climate change,” says Blair. “Continued escalation of energy demand will hasten the impacts of climate change,” he says.

However, he warns that “Forcibly cutting back on fossil fuel use before substitutes are widely available could threaten continued economic development, particularly for countries like China, whose industries have not yet achieved high levels of energy efficiency.” Further, “a switch from use of arable land for food to fuel crops provides a limited solution and could exacerbate both the energy and food situations.”

Blair also raised concerns that “lower oil prices may weaken momentum toward energy efficiency and the development of alternative sources of energy that are important for both energy and environmental security.” Even here, however, the situation is complex. Blair notes that low oil prices discourage development of new refinery capacity, creating the conditions for another damaging oil price spike, but have the benefit of “undercutting the economic positions of some of the more troublesome ((oil)) producers.” . . .

Blair reiterates the findings of a National Intelligence Assessment (NIA), that Democratic lawmakers had pushed for and which was published by the National Intelligence Council (NIC) in June. The NIA found that climate change will be a significant destabilizing factor, or “threat multiplier.” This theory holds that although climate change and resource scarcity will directly impact the United States, in the near term the impact on other countries in already unstable regions such as Africa and the Middle East will be of more concern. . . .

The emphasis of the intelligence chief on climate and environmental issues goes beyond that afforded by Blair’s predecessor Mike McConnell, who resisted a push by House Democrats in 2007 for the NIC to prepare a National Intelligence Estimate (NIE), the most high level and involved type of intelligence analysis, on climate change.

By Joe Gould
February 17, 2009 at 5:00 AM

Counterinsurgency guru and Rhodes scholar John Nagl was named the president of the Center for a New American Security on Feb. 13.

Nagl, author of "Learning to Eat Soup with a Knife: Counterinsurgency Lessons from Malaya and Vietnam," takes over for Michèle Flournoy, who recently joined the Obama administration as the under secretary of defense for policy.

“In general, I would like to say that I have big shoes to fill, but that would imply that Michèle has big feet, and I don't want to do that,” Nagl quipped last week in an interview with Inside the Army.

On a more serious note, Nagl called Flournoy, a one-time research professor at the National Defense University's Institute for National Strategic Studies, “a wonderful leader, warm, caring, compassionate, and a patriot.”

Nagl plans to continue his advocacy of “strong, pragmatic defense policies,” with an emphasis on the Army's adaptation to irregular warfare, energy security and emerging threats.

As president, Nagl's role will include more contact with the nonprofit's corporate and foundation sponsors. He called the promotion from senior fellow "daunting” but an “extraordinary honor.”

“It's a fantastic place, but I have spreadsheets on my desk now and office diagrams,” said Nagl. “So my job is not just to talk to the press, and talk and speak, but it's also make the books come out in the black at the end of the month. I'm excited, I'm thrilled. It's a huge stretch for me.”

Nagl, who helped author the Army's counterinsurgency field manual, retired from the Army with the rank of lieutenant colonel last year.

By Christopher J. Castelli
February 17, 2009 at 5:00 AM

Richard Danzig, the former Navy secretary who served as a senior adviser in President Barack Obama's White House campaign, will be the new chairman of the board of directors for the Center for a New American Security, the think tank announced today. Danzig had been a board member.

In his new role, Danzig succeeds William Perry, the former defense secretary who had led the think tank's board. Perry will stay on as a board member.

As you read here earlier today, John Nagl was named the new president of the Center for a New American Security on Feb. 13.

By Sebastian Sprenger
February 17, 2009 at 5:00 AM

Two lawmakers last week made it clear they want nothing to do with the oft-cited "hard choices" that dominate defense budget conversations these days.

Republican Sen. James Inhofe (OK) and Rep. Trent Franks (AZ) introduced a joint resolution on Feb. 12 that supports a minimum annual defense budget equivalent to 4 percent of the country's gross domestic product.

The idea is hardly new, but it comes at a time when all signs point to an inevitable advent of declining defense budgets in the face of a deep economic crisis.

Advocates of a 4-percent floor believe such a move would make spending on defense programs more predictable and ensure a big-enough industrial base. Opponents say the requirement would tempt defense leaders into crafting national security strategies to fit a given defense budget -- instead of working the other way around.

In his remarks introducing the joint resolution on the Senate floor, Inhofe sought to cast his proposal as a means to counter the economic crisis.

The measure would "create and maintain jobs across America and sustain our military industrial base," he said. "Investing in our Nation's defense provides thousands of sustainable American jobs and provides for our national security at the same time. Experts estimate that each $1 billion in procurement spending correlates to 6,500 jobs."

Inhofe added: "Major defense procurement programs are all manufactured in the United States with our aerospace industry alone employing 655,000 workers spread across 44 States. The U.S. shipbuilding industry supports more than 400,000 workers in 47 States."

Irrespective of the 4-percent question, Inhofe's remarks foreshadow a drama that could soon unfold on Capitol Hill should defense leaders opt to recommend the axing of some of the big-ticket weapon programs this budget season.

Will lawmakers agree to cut Defense Department programs under the current economic pressure when the same economic pressure demands that they preserve defense-related jobs in their districts?

Talk about hard choices.

By Carlo Muñoz
February 13, 2009 at 5:00 AM

Newly appointed Director of National Intelligence Dennis Blair has had a busy 10 days.

Since taking the reins of the U.S. intelligence community, Blair has gotten up to speed on the slate of current security threats and issued the community's annual assessment report to Congress on Feb. 12, as well as tackling issues such as a nuclear Iran, the spread of terrorist influences in Africa and Latin America and the impact of the ongoing economic crisis on national security.

Suffice to say, the former U.S. Pacific Command chief has little time to watch television.

However, the DNI's viewing habits were the subject of debate when Senate Select Committee on Intelligence member Sen. Jay Rockefeller (D-WV) questioned Blair during a Feb. 12 hearing on Capitol Hill. "I'm going to ask you a very different kind of question, but one which I think has enormous consequences both in this country and across the world," Rockefeller said as he began his unusual line of questioning.

Continuing on, the former committee chairman pressed Blair for his thoughts on the Fox Network's fictional spy drama "24," and whether or not the actions of the show's main character, intelligence operative Jack Bauer, glorifies the use of torture as a viable interrogation tool.

In the new season of "24," Bauer has been called to testify before a Senate investigations panel to answer for his use of questionable interrogation tactics to thwart a pending terrorist attack in the United States. During the show's season premiere last month, Bauer threatened to drive a ballpoint pen through an individual's eye, as a means of obtaining the location of a domestic terrorist cell.

Rockefeller noted that West Point Dean Brig. Gen. Patrick Finnegan tried "to convince the producers of this TV show '24' not to glorify torture," claiming the show was having a "toxic effect" on cadets' training and ethics.

Admitting the show is "celebrated in some circles" for its depiction "of the tough choices that have to be made in the war on terrorism," Rockefeller asked Blair whether he thought the show was an accurate portrayal of the ongoing global war on terror.

Blair's response: "I've never seen an episode of that show, senator, so I can't help you."

For hearing excerpts as well as Blair's prepared testimony, click here.

By Carlo Muñoz
February 12, 2009 at 5:00 AM

(UPDATE: Blair's prepared testimony is now available -- see link below.)

Today, Congress will receive its first glimpse into the Obama administration's views on the slate of national security threats facing the United States, and how the White House plans on addressing those threats in the near and long-term.

Newly minted Director of National Intelligence Dennis Blair is set to testify before members of the Senate Select Intelligence committee, less than a month after the Senate confirmed his nomination to become the top U.S. intelligence official in January.

The former U.S. Pacific Command chief replaces former DNI Mike McConnell and is the first brand-new member of President Obama's national security appointees to assume his position under the new administration. Bush appointee Defense Secretary Robert Gates was asked to remain at the Pentagon by the White House.

While details are scant regarding the current threat assessment Blair plans to present to lawmakers today, issues regarding the nuclear ambitions of Iran and North Korea, the continuing spread of influence across the globe by violent extremist organizations like al Qaeda and the continuing hunt for Osama Bin Laden are likely to top the list.

However, Blair's testimony does coincide with a number of significant changes to intelligence and national security policy taken on by the new administration in recent weeks.

This week, Obama launched a new soup-to-nuts review on U.S. policy in Afghanistan and Pakistan, which is expected to dramatically increase the number of American troops in that country.

Last month, the White House issued a slew of executive orders which set a timetable for the closure of the U.S. detention facility at Guantanamo Bay, Cuba and set new standards for interrogation tactics used against suspected terrorists.

For some background, click here to view the testimony from Blair's confirmation hearing.

Click here for Blair's prepared testimony on the intel community's latest worldwide threat assessment.

By Kate Brannen
February 12, 2009 at 5:00 AM

Given the state of the economy, voting for the economic stimulus package will essentially be equivalent to voting to reduce defense spending, Rep. J. Randy Forbes (R-VA) said today.

After listening to defense experts explain what needs to be done in Afghanistan, House lawmakers questioned whether or not there would be sufficient resources to meet the military's operational objectives.

Can victory still be achieved in Afghanistan and Iraq with dramatic cuts to defense spending, Forbes asked at today's House Armed Services Committee hearing.

As it stands, Congress plans to vote on the economic stimulus package of about $789 billion tomorrow so that it can reach President Obama's desk by Monday.

The hearing panel included CSIS' Anthony Cordesman, Council on Foreign Relation's Stephen Biddle, retired Army Gen. Jack Keane, and Janet St. Laurent from the Government Accountability Office.

Keane said that when troops' lives are on the line, the resources they need will be met; however the Defense Department has to make budget choices based on the money made available to them.

"I don't believe operations and maintenance dollars will be cut," said Keane.

Where Defense Secretary Robert Gates does have discretion is in his investment and capital accounts, Keane told lawmakers.

"That's where he'll go to make cuts to live within the budget given to him," said Keane.

By Jason Sherman
February 12, 2009 at 5:00 AM

The Senate tonight unanimously confirmed Leon Panetta as director of the Central Intelligence Agency, Sen. Diane Feinstein's office just announced.

By John Liang
February 11, 2009 at 5:00 AM

It may have taken a little longer than some expected, but the Senate today voted 93-4 to confirm the nomination of William Lynn for the No. 2 spot at the Pentagon.

Click here and here for our coverage of his nomination saga.

By John Liang
February 11, 2009 at 5:00 AM

Milan Vodicka, a Czech journalist, is using the platform of The Wall Street Journal's op-ed page today to warn the United States against turning its back against his country on missile defense, after so much political capital was spent getting the agreement to base an X-band radar there.

If the United States builds a radar system in the Czech Republic as part of the missile defense program developed by the Bush administration, it's likely that the Russians will target the Czech Republic with their tactical nuclear missiles. But many Czechs are fearful of an even greater danger than Russia: The possibility that the U.S. may decide not to deploy the defense system. Unfortunately, Vice President Joseph Biden suggested this prospect last week in Munich when he said, "We will wait for what the experts say and then we will see."

Czech politicians and their Polish counterparts have invested a lot of political capital in the missile defense project. If the Obama administration doesn't follow through, supporters of the missile shield would feel abandoned by the U.S.

What's worse, Czech and Polish leaders would lose credibility among their opponents and, most importantly, Russia. Moscow would see the failure to build the radar system as proof of its influence over Central Europe, and as recognition of its veto power over European security policy.Mr. Biden doesn't seem to appreciate that the missile defense project isn't just about American interests. It's about the Czechs and the Poles, too.

But the juiciest line comes later:

It's beginning to look as though the Americans were taking us for a ride. Now that there's a new driver in the White House, they think they can just drop us off at the curb.

Last week, we reported on a presentation by Stanford academic Dean Wilkening, who argues that Bush-era plans to station ballistic missile defense assets in Poland and the Czech Republic offer European nations less protection from Iranian missiles than defense officials have claimed publicly. Inside Missile Defense was able to interview Wilkening yesterday, and today's issue features an updated version of the story.

By John Liang
February 11, 2009 at 5:00 AM

This just in from the Senate Select Intelligence Committee:

WASHINGTON, DC -- Today Senators Dianne Feinstein (D-Calif.), chairman of the Senate Intelligence Committee, and Christopher (Kit) Bond (R-Mo.), vice chairman of the committee, announced that the committee has approved the nomination of Leon Panetta to be the next Director of the Central Intelligence Agency.

“Leon Panetta will mark a new beginning for the CIA as its next Director. He has the integrity, the drive and the judgment to ensure that the CIA fulfills its mission of producing information critical to our national security, without sacrificing our national values,” Senator Feinstein said.

“He has promised the Senate Intelligence Committee that he will not allow coercive interrogation practices, secret prisons, or the transfer of terrorist suspects to countries that may use torture. And he has pledged to surround himself with career professionals, to keep Congress fully and currently informed, and to give the President unvarnished, independent advice. I am confident that the President and the nation will be well-served by Mr. Panetta as our next CIA Director.”

“I have supported Mr. Panetta after receiving his assurances that he will lean forward in the fight against terrorism to keep our nation safe,” Senator Bond said. “He has committed to using all appropriate and lawful means to do so, including the use of contract employees when the agency does not have a qualified government employee to perform the job, exploring the use of enhanced interrogation techniques on high-value detainees that may warrant going beyond the Army Field Manual in certain situations, and the lawful rendition of detainees to countries who have assured our State Department that they will not engage in torture.”

Panetta’s confirmation in the full Senate is expected to take place "as soon as possible," according to Feinstein's and Bond's joint statement.

By John Liang
February 10, 2009 at 5:00 AM

Textron's sales of the V-22 Osprey and other products to the Defense Department may be one of the few things keeping the company's debt rating from truly tanking, according to a report issued yesterday by debt-rating agency Fitch Ratings:

Fitch Ratings has downgraded the Issuer Default Ratings (IDR) and long-term debt ratings for Textron Inc. (TXT) and Textron Financial Corporation (TFC) to ‘BBB-’ from ‘BBB’. In addition, the short-term IDRs and commercial paper ratings have been downgraded to ‘F3’ from ‘F2’. The Rating Outlook is Negative.

At the same time, Fitch has downgraded and simultaneously withdrawn its ratings for TXT’s preferred securities due to the small amount outstanding. Debt and preferred securities totaled nearly $11 billion at Jan. 3, 2009, including $2.5 billion at TXT and $8.3 billion at TFC. . . .

The downgrade of TXT’s and TFC’s ratings recognizes execution risks related to TFC’s plans to exit its non-captive finance business, as well as difficult economic conditions that could pressure TFC’s asset quality and financial performance at TXT’s manufacturing businesses. These factors could lead to liquidity pressures in 2010 in the absence of asset sales or capital market transactions. Other developments considered in the ratings include the full drawdown of the company’s committed bank facilities and the recently announced management changes, which emphasize the broad challenges facing the company.

Here's what Fitch had to say about Textron's manufacturing business, of which the V-22 is a big part (through its Bell Helicopter subdivision):

At TXT, the ratings incorporate Fitch’s view that TXT’s manufacturing businesses will generate positive free cash flow, albeit at lower levels than in the past due to weaker demand at Cessna and for the Industrial segment. In late January 2009, TXT lowered its estimate for deliveries in 2009 to 375 aircraft, a nearly 20% reduction from the 467 jets that were delivered in 2008. In Fitch’s view, the reduction understates the decline in demand because the mix of low-end Mustangs has been increasing. As a result of higher deferrals and sharply lower orders, deliveries could potentially remain at lower levels for a sustained period. However, the impact is partly offset by Cessna’s large backlog that totaled $14.5 billion at the end of 2008 after peaking at $15.6 billion in September 2008. The outlook for TXT’s Bell and Defense & Intelligence segments is more stable, helping to mitigate concerns about declining demand for business jets and difficult conditions in TXT’s Industrial segment.

While Textron's overall defense business looks safe, implementing the Pentagon's earned-value management rules has been a challenge, as Inside the Pentagon reported late last month:

When contractors fail to follow the rules, they risk losing their certification. That happened to Bell Helicopter Textron in March 2006; the company has struggled ever since to earn it back. Bell again failed to reach this goal during ((the Defense Contract Management Agency's)) most recent review of the company last November. The next such review is slated for March.

Fitch put out the rating in the wake of Textron's reshuffling of the folks in charge of its soon-to-be-defunct financing business earlier this morning. In December, the company announced it was getting out of the financing business altogether.

At the very least, yesterday’s news should make the company's presentation today at an industry conference in Miami Beach, FL, rather interesting.

By John Liang
February 10, 2009 at 5:00 AM

President Obama has asked Bruce Riedel from the Brookings Institute to chair an interagency review of U.S. policy toward Afghanistan and Pakistan, White House spokesman Robert Gibbs said today.

Riedel is working at the White House for 60 days while on temporary leave as a senior fellow at Brookings' Saban Center for Middle East Policy. The study is to be completed before the NATO summit in April, according to the White House transcript of Gibbs' remarks on board Air Force One.

Amb. Richard Holbrooke and newly minted Under Secretary of Defense for Policy Michèle Flournoy have been appointed as co-chairs of the review, according to Gibbs. Riedel will report directly to the president and National Security Adviser James Jones, Gibbs added.

The proposed study is separate from the military review slated for completion this month. U.S. Central Command chief Gen. David Petraeus is overseeing that one.

Given that the economy has been pretty much dominating today's news as well as this morning's press gaggle, here's the only question that was asked at the White House (or should we say Air Force One) briefing about Riedel's Afghanistan-Pakistan study:

Q: Robert, just a quick question on the Afghanistan panel. How broad is that mission going to be? Is it going to look at troop increases and things like that? Or is it more going to look at --

MR. GIBBS: Well, obviously, there's a review that overlaps also with what General Petraeus is doing. I think everyone has mentioned that in order for us to change the direction that we see in Afghanistan, we can't simply focus on just the military aspects, that we have to focus on the diplomatic, the civil society, the reconstruction.

So I think with what Bruce is doing, and what other military planners are doing, is looking at the Afghanistan and Pakistan policies in a -- not just in how many troops, but in a broad sense of what is possible and what needs to happen in order to change the direction.