At the end of 1994, Jim Woolsey recorded a farewell address to his troops at the CIA, sent a letter of resignation to the White House by courier, and left town in a hurry. Bill Clinton searched the government for someone willing and able to take the job.
"The president asked me whether I was interested in being the director of central intelligence," said his deputy secretary of defense, John Deutch. "I made it very clear to him that I was not. I saw my friend Jim Woolsey having tremendous difficulties as director. I didn't think that there was any reason for me to think I could do better."
Fine, Clinton replied, find someone who can. Six weeks went by before Deutch managed to press-gang a retired air force general named Mike Carns for the job. Six more weeks passed before the nomination wobbled, plummeted, and crashed.
"The president pressed on me the view that I really had to do it," Deutch said. Thus began a short and bitter lesson in the political science of American intelligence. Deutch had good reason to dread the assignment. He had been in and around national-security circles for three decades, and he knew that no director of central intelligence ever had succeeded in fulfilling his charter--serving simultaneously as the chairman of American intelligence and the chief executive of the CIA. He requested and received cabinet rank, as Bill Casey had, to ensure himself some access to the president. He had hopes that he might become the secretary of defense if Clinton was re-elected in 1996. But he knew that the CIA was in a state of turmoil that could not be repaired in a year or two.
"Plagued by poor leadership, the Agency is adrift," a veteran CIA analyst, John Gentry, wrote during the days that Deutch first came to office. "It has a palpable malaise. The unhappiness level of employees well into management ranks is very high. Senior officers are floundering as well." The agency was led by "a corps of senior officers so devoid of real leadership skills that it is largely incapable of independent creative action." With Clinton apparently content to get his intelligence from CNN, Gentry wrote, the CIA had "no one left to pander to."
As deputy secretary of defense, Deutch had been through a yearlong review of American intelligence with Woolsey, trying for a truce in the endless wars over money and power between the Pentagon and the CIA. They would pick an issue--say, the proliferation of nuclear weapons--and at the end of the day they would conclude that much more had to be done. Counterintelligence? After Ames, definitely more. Support to military operations? Hugely important. Human intelligence? More spies. Better analysis? Absolutely crucial. At the end of the review it was clear that there were an infinite number of needs and a finite amount of money and personnel available to meet them. American intelligence could not be reformed from within, and surely it was not being reformed from without.
Deutch and Woolsey both had the well-known I'm-the-smartest-guy-in-the-room syndrome. The difference was that Deutch often was the smartest. He had been the dean of science and the provost at the Massachusetts Institute of Technology; his field was physical chemistry, the science of the transformation of matter at the molecular, atomic, and subatomic levels. He could explain how a lump of coal becomes a diamond. He set out to transform the CIA under that type of pressure. At his confirmation hearings, he had vowed to change the culture of the CIA's clandestine service, "down to the bare bones," but he had no clear idea how. Like his predecessors, he went to learn at the feet of Richard Helms.
Helms, now eighty-two, carried himself with the bearing of a British peer. Shortly after his skull session with the new director, I had lunch with him at a restaurant two blocks from the White House. Helms sipped a noontime beer, sitting beneath slowly revolving ceiling fans, and confided that Deutch was instinctively drawing away from the clandestine service--"seeing it as nothing but trouble. Nor is he the first to be distancing himself. He's got to do a job convincing them he's on the team."
In May 1995, a few days after Deutch showed up for work at CIA headquarters, the leaders of the clandestine service, always conscious of the need to recruit a new boss, presented him with a glossy brochure titled "A New Direction. A New Future." It was the list of their top ten targets: loose nukes, terrorism, Islamic fundamentalism, support for military operations, macroeconomics, Iran, Iraq, North Korea, Russia, China. The new director and his spies all knew that the White House wanted to use the CIA as a private Internet, a database on everything from tropical rain forests to compact-disc counterfeiters, and that its attention needed a far sharper focus. "The trouble is there's too much to do," Deutch said. "You get requests: What's going to happen in Indonesia? What's going to happen in Sudan? What's going to happen in the Middle East?" The call for global coverage was impossible to fulfill. Let us concentrate on a few hard targets, the spies said. Deutch could not settle the argument.
Instead, he worked for five months trying to get a handle on the clandestine service. He flew off to CIA stations around the world, listening, questioning, and weighing what he had to work with. He said he found "tremendously poor morale." He was shocked by the inability of his spies to solve their own problems. He found them in a state approaching panic.
He compared them to the American military after Vietnam. Back then, as Deutch put it in September 1995, a lot of smart lieutenants and colonels had looked at one another and said: "'We're in trouble. We've got to change. We've got to figure out a way to do this differently. We're either leaving or we're going to change the system.' And the people who stayed did change the system." Deutch wanted the clandestine service to solve its own problems. But he found his people incapable of change. "Compared to uniformed officers," he said of his spies, "they certainly are not as competent, or as understanding of what their relative role is or what their responsibilities are." The clandestine service "was not confident of carrying out its day-to-day activity."
This crisis of confidence took many forms. Some were made manifest in misguided operations that backfired. Others were continuing failures of collection and analysis. Some were breathtaking lapses in judgment.
In Bosnia, on July 13, 1995, as the world's press reported mass killings of Muslims by Serbs, a spy satellite sent back pictures of prisoners being guarded by gunmen in fields outside the town of Srebrenica. No one at the CIA looked at that picture for three weeks. No one had thought that the Serbs would conquer the town. No one anticipated a slaughter. No one paid heed to human-rights groups, the United Nations, or the press. The CIA had no officers and no agents in the field to corroborate what they were reporting. It had no information about any atrocities. It had been ordered to devote itself to supporting military operations in the region, and it had neither time nor talent to spare to check out reports from terrified refugees.
Two weeks after the first press accounts of a slaughter, the CIA sent a U-2 over Srebrenica; the plane recorded images of freshly dug mass graves in the fields where the prisoners had stood. Those photos arrived at the CIA on a regular military courier flight three days later. And three days after that, a CIA photo analyst matched up the location of the first satellite image of the prisoners in the field with the second U-2 image of burial sites. The analysis landed at the White House on August 4, 1995.
Thus did the CIA report, three weeks after the fact, the biggest mass murder of civilians in Europe since Hitler's death camps fifty years before. Eight thousand people were dead, and the agency had missed it.
On the other end of Europe, the CIA's Paris station had run an elaborate operation trying to steal the French negotiating position on trade talks. Locked into the idea that free trade was the guiding force of American foreign policy, the White House had aggravated the CIA's woes by demanding more and more economic intelligence. The Paris station was pursuing secrets of minimal importance to the national security of the United States--such as how many American movies would be shown on French screens. The French interior ministry ran a counterespionage operation that included the seduction of a CIA officer working under nonofficial cover as a businesswoman. There was pillow talk, and secrets were spilled. The government publicly expelled the Paris station chief--Dick Holm, a genuine hero at the clandestine service, who had run field operations in Laos and barely survived a fiery plane crash in the Congo thirty years before, and who was on his last tour before retirement. Four hapless and humiliated CIA officers were kicked out of France with him.
Another blown operation, another public embarrassment for the clandestine service, and "another public example of a situation where its ability to carry out its function as its own standards required came into question," Deutch said. He asked his officers time and again: "What are the professional standards of carrying out your very difficult mission? And are you doing it well all over the world?" His answer to that last question was a resounding no.
"IT WAS CLEARLY MALICE"
The problems at the Paris station were a passing annoyance compared to what went on in the Latin American division of the clandestine service. The division was a world apart at the CIA, dominated by veterans of the war against Fidel Castro, men who had their own set of rules and disciplines. Since 1987, station chiefs in Costa Rica, El Salvador, Peru, Venezuela, and Jamaica had been accused of lying to superiors, sexually harassing coworkers, stealing money, threatening underlings at gunpoint, running a counternarcotics operation in which a ton of cocaine wound up on the streets of Florida, and keeping sloppy accounts involving $1 million in government funds. It was the only division in the clandestine service in which station chiefs were removed from their posts for misconduct on a regular basis. The division's isolation flowed in part from the internal politics of the countries it covered. Throughout the cold war, the CIA had worked with military regimes against left-wing insurgencies in Latin America. The old bonds were hard to break.
In Guatemala, 200,000 civilians had died during forty years of struggle following the agency's 1954 coup against an elected president. Between 90 and 96 percent of those deaths came at the hands of the Guatemalan military. In 1994, the CIA's officers in Guatemala still went to great lengths to conceal the nature of their close relations to the military and to suppress reports that Guatemalan officers on its payroll were murderers, torturers, and thieves. This concealment violated a balancing test that Woolsey had started in 1994. The test, called "agent validation," was supposed to weigh the quality of an agent's information against the perfidiousness of his conduct.
"You don't want to be in a position of dealing with military officials or officials in that government who are known by everyone to have blood on their hands unless there is a legitimate intelligence goal to be served," said Inspector General Fred Hitz. "Unless that person knows that there's a cache in southern Guatemala where biological weapons are being put together and they're going to be sold on the open market and he's your only source for it. If a person is notorious for butchering people, breaking the law, then the fact that the CIA is in contact with that individual has to be balanced against the information that individual is likely to provide. If the information is the keys to the holy mystery, we'll take the chance. But let's do it with our eyes open and not because of inertia or momentum."
This problem boiled over when a Guatemalan colonel on the CIA's payroll was implicated in the cover-up of the murders of an American innkeeper and a Guatemalan guerrilla married to an American lawyer. The outcry over the innkeeper's murder had led the Bush administration to cut off millions of dollars in military aid to Guatemala, though the agency continued its financial support for Guatemalan military intelligence. "The CIA station in Guatemala was about twice the size it needed to be," said Thomas Stroock, the American ambassador to Guatemala from 1989 to 1992, but it could not seem to bring itself to report accurately on the case. The station chief, Fred Brugger, failed to tell Ambassador Stroock that the colonel, a prime suspect, was a CIA agent. "Not only did they not tell me," Ambassador Stroock said, "they did not tell my boss, the secretary of state, or the Congress. That was stupid."
Folly turned to malevolence in 1994, when Dan Donahue became the station chief. While the new American ambassador, Marilyn McAfee, was preaching human rights and justice, the CIA stayed loyal to the murderous Guatemalan intelligence service.
The embassy split in two. "The chief of station came into my office and showed me a piece of intelligence, which came from a Guatemalan source, suggesting that I was having an affair with my secretary, whose name was Carol Murphy," Ambassador McAfee remembered. The Guatemalan military had bugged the ambassador's bedroom and recorded her cooing endearments to Murphy. They spread the word that the ambassador was a lesbian. The CIA station transmitted this piece of intelligence--later known as "the Murphy memo"--to Washington, where it was widely distributed. "The CIA sent this report to the Hill," ambassador McAfee said. "It was clearly malice. The CIA had defamed an ambassador by back channels."
The ambassador was a conservative person from a conservative family, she was married, and she was not sleeping with her secretary. "Murphy" was the name of her two-year-old black standard poodle. The bug in her bedroom had recorded her petting her dog.
The CIA station had shown a stronger affinity for its friends in the Guatemalan military than for the American ambassador. "There was a division between intelligence and policy," Ambassador McAfee said. "That's what scares me."
It scared Deutch too. On September 29, 1995, toward the end of his fifth month in office, Deutch went to the Bubble--the once-futuristic six-hundred-seat amphitheater near the entrance to CIA headquarters--to deliver some bad news to the clandestine service. An internal-review board at the CIA had weighed the evidence in Guatemala and told Deutch that he should dismiss Terry Ward, the Latin American division chief of the clandestine service from 1990 to 1993, then serving as the chief of station in Switzerland. It said he should dismiss the former Guatemala station chief Fred Brugger too, and discipline his successor Dan Donahue severely, making sure he never served as a station chief again.
Deutch said there were "tremendous deficiencies in the way the agency carried out its business" in Guatemala. The problem was lying--or, as he put it, "a lack of candor"--between the chief of station and the American ambassador, the station and the Latin American division, the division and headquarters, and finally between the agency and Congress.
It was rare--very rare--for anyone to be fired from the clandestine service. But Deutch said he was going to do exactly as the review board recommended. The announcement did not go over well at the Bubble. The hundreds of officers gathered there were ferociously angry. Deutch's decision signified to them a suffocating political correctness. The director told them that they had to keep going out into the world and taking risks in the name of national security. A low growl rose from the back of the Bubble, a bitter laugh signifying: Yeah. Sure. That was the moment when the director and the clandestine service washed their hands of one another. It sealed his fate at the CIA.
"WE WANT TO GET THIS RIGHT"
The break was unbridgeable. Deutch decided to hand the portfolio of problems at the clandestine service to his number-two man--George Tenet, the deputy director of central intelligence. Now forty-two years old, Tenet, always the tireless and loyal aide, had spent five years as staff director of the Senate intelligence committee and two years as the National Security Council's point man for intelligence. He had vital insights in managing the CIA's tortured relationships with the Congress and the White House. And he soon came to see the clandestine service differently than Deutch did--not as a problem to be solved but a cause to be championed. Tenet would do his utmost to lead them.
"Let me explain life to you," Tenet said he told the clandestine service chiefs. "Here are the ten or fifteen things, that we cannot tolerate to fail against, to advance the national-security interests of the United States. This is what we want you to devote your money, your people, your language training, and your skills to. We want to get this right."
Terrorism soon rose to the top of Tenet's list. In the fall of 1995, a barrage of threatening reports started coming from the CIA station in the Sudan to the agency headquarters and the White House counterterrorism czar, Richard Clarke. They were based on the word of a single recruited CIA agent. They warned of an imminent attack against the station, the American embassy, and a prominent member of the Clinton administration.
"Dick Clarke came to me and said, 'They're going to blow you up,'" remembered Tony Lake, the president's national security adviser. Who is going to blow me up? Lake asked. Maybe the Iranians, Clarke replied, maybe the Sudanese. "So I went to live in a safe house and drove to work in a bulletproof car," Lake said. "They could never show it was real. I suspect not."
The Sudan was an international clearinghouse for stateless terrorists in those days. Among them was Osama bin Laden. The agency first knew him in the late 1980s as a rich Saudi who supported the same Afghan rebels that the agency armed in their fight against their Soviet oppressors. He was known as a financier of people who had grand visions of attacking the enemies of Islam. The CIA never pulled together its shards and fragments of intelligence on bin Laden and his network into a coherent report for the White House. No formal estimate of the terrorist threat he represented was published until after the entire world knew his name.
Bin Laden had returned to Saudi Arabia to rail against the presence of American troops after the 1991 Gulf War. The Saudi government expelled him, and he settled in the Sudan. The CIA's station chief in the Sudan, Cofer Black, was an old-school operator of considerable courage and cunning who had helped hunt down the burned-out terrorist known as Carlos the Jackal. Black tracked bin Laden's movements and motives in the Sudan as best he could. In January 1996, the CIA created a counterterrorism unit of a dozen people devoted entirely to the Saudi--the bin Laden station. There was a sense that he might start taking aim at American targets abroad.
But in February 1996, the CIA, heeding the warnings of its recruited agent, shut down its operations in the Sudan, blinding itself to fresh intelligence on its new target. The station and the American embassy were shuttered and their personnel moved to Kenya. The decision came over the strongest objections of the American ambassador, Timothy Carney, a man of military discipline along with diplomatic sensibilities. He argued that for the United States to withdraw from the Sudan was a dangerous mistake. He questioned the CIA's warnings about an imminent attack, and he was proved right. The agent who had raised the alarm was later found to be a fabricator, and the CIA formally withdrew roughly one hundred reports based on his information.
Shortly thereafter, bin Laden moved to Afghanistan. The chief of the bin Laden station, Mike Scheuer, saw this as a tremendous opportunity. The CIA had reestablished contacts with a network of Afghan exiles in the tribal northwest territories of Pakistan. The "tribals," as the CIA called them, were helping in the hunt for Mir Amal Kansi, the gunman who had killed two agency officers outside headquarters.
The hope was that they could help kidnap or kill bin Laden someday. But that day would have to wait. The CIA had another man in its crosshairs at that moment.
The chief of the Near East division of the clandestine service, Stephen Richter, had been working for two years on a plan to support a military coup against Saddam Hussein. The order had come from President Clinton, the third such command from the White House to the CIA in five years. In Jordan, a team of CIA officers met with Mohammed Abdullah Shawani, a former commander of Iraqi special forces. In London, the agency conspired with an Iraqi exile named Ayad Alawi, who headed a network of rebellious Iraqi military officers and Ba'ath Party leaders. The CIA backed him with money and guns. In northern Iraq, the CIA gathered the tribal leaders of the stateless Iraqi Kurds, renewing an old and troubled romance.
Despite the CIA's best efforts, none of these disparate and fractious forces came together. The agency invested many millions trying to recruit key members of Saddam's military and political circles, hoping they would rise up. But the plot was penetrated and subverted by Saddam and his spies. On June 26, 1996, Saddam began arresting at least two hundred officers in and around Baghdad. He executed at least eighty of them, including General Shawani's sons.
"The Saddam case was an interesting case," Mark Lowenthal, who had been staff director of the House intelligence committee and a senior CIA analyst, said after the coup collapsed. "All right, so we get rid of Saddam Hussein, good thing. But who do we get after him? Who's our guy in Iraq? Anybody that we put in power in Iraq is likely to have the staying power of a flea. So this was a case where you had policy makers saying do something. This do something urge really expressed their frustration." They failed to see that the CIA "had no way to deal with Saddam Hussein," he said. "The problem with the operation was that there were no reliable Iraqis to deal with. And the reliable Iraqis you're looking at have no access to do what you want to them to do. So the operation was a bust. It wasn't feasible. But it's very hard for an operator to say, 'Mr. President, we can't do that.' So you end up with an operation that probably shouldn't have been started in the first place."
"FAILURE IS INEVITABLE"
Deutch infuriated Clinton by telling Congress that the CIA might never solve the problem of Saddam Hussein. His seventeen-month tenure as director of central intelligence ended in bitterness. In December 1996, after Clinton was re-elected, he dismissed Deutch from the government and turned to his national security adviser, Tony Lake, to take the job so few coveted.
"It would have been a great challenge," Lake mused. "What I had in mind was pushing the analytical side to make intelligence--both its sources and its products--fit in with the world of the mid-1990s. What we got was too often an overnight parsing of the news."
But Lake would not be confirmed. The Republican chairman of the Senate intelligence committee, Richard Shelby of Alabama, decided to make him a whipping boy for everything that conservatives found wrong with the Clinton administration's conduct of foreign policy. The appearance of bipartisanship that the intelligence committees had maintained for the better part of twenty years evaporated. There was also an undercurrent of opposition to Lake from inside the clandestine service. The message was: don't send us any more outsiders.
"To the CIA, everyone is an outsider," Lake observed.
It was not even close to a fair hearing. On March 17, 1997, Lake withdrew in anger, telling the president that he was not going to spend three more months as "a dancing bear in a political circus." So the poisoned chalice was handed to George Tenet--the only choice remaining. Tenet was already running the agency as the acting chief. He would become the fifth director of central intelligence in six years.
"It is impossible to overstate the turbulence and disruption that that much change at the top caused," the CIA's Fred Hitz said. "Its impact on morale is hard to overstate, in terms of its destructiveness. You have the feeling--who's in charge here? Can't anybody up there play this game? Don't they understand what we're about? Don't they realize what our mission is?"
Tenet knew what the mission was: save the CIA. But the agency approached the end of the American Century burdened by a personnel system invented in the 1880s, an information conveyor belt resembling assembly lines of the 1920s, and a bureaucracy dating to the 1950s. It moved people and money around in ways that summoned up memories of Stalin's Five-Year Plans. Its ability to collect and analyze secrets was falling apart as the information age exploded and the Internet made encryption--the transformation of language into code--a universal tool. The clandestine service had become a place where "great successes are rare and failure is routine," a report by the House intelligence committee noted.
Those failures once again were front-page news. The CIA's capacity for spying had once again been wounded by a traitor from within. Harold J. Nicholson, who had been station chief in Romania, had taken up a two-year posting as a head instructor at the Farm, the CIA's training school outside Williamsburg, Virginia. He had been spying for Moscow since 1994, selling the Russians files on dozens of CIA officers stationed abroad and the identities of every new officer graduated from the Farm in 1994, 1995, and 1996. The CIA told the federal judge who sentenced Nicholson to twenty-three years in prison that it would never be able to calculate the damage he had done to its operations worldwide. The careers of three years' worth of CIA trainees were blighted; once burned, they could never serve overseas.
On June 18, 1997, three weeks before Tenet's swearing-in, a new report by the House intelligence committee erased the remnants of the prideful notion that the CIA served as America's first line of defense. The committee, led by Porter J. Goss, said the agency was filled with inexperienced officers unable to speak the languages or understand the political landscapes of the countries they covered. It said the CIA had a small and dwindling capability to gather intelligence through espionage. It concluded that the CIA lacked the necessary "depth, breadth, and expertise to monitor political, military, and economic developments worldwide."
Later that summer, a career intelligence officer named Russ Travers published a haunting essay in the CIA's in-house journal. He said America's abilities to gather and analyze intelligence were falling apart. For years, he wrote, the leaders of American intelligence had been insisting that they were putting the agency on the right track. This was a myth. "We fine-tune our structures and marginally change our programs...getting the deck chairs on the Titanic nice and neat." But "we are going to begin making more and bigger mistakes more often," he warned. "We have gotten away from basics--the collection and unbiased analysis of facts."
He offered a prophecy for the future leaders of the CIA. "The year is 2001," he wrote. "By the turn of the century, analysis had become dangerously fragmented. The Community could still collect 'facts,' but analysis had long ago been overwhelmed by the volume of available information and were no longer able to distinguish between significant facts and background noise. The quality of analysis had become increasingly suspect.... The data were there, but we had failed to recognize fully their significance.
"From the vantage point of 2001," he wrote, "intelligence failure is inevitable."