US Intelligence Is More Privatized Than Ever Before

US Intelligence Is More Privatized Than Ever Before

US Intelligence Is More Privatized Than Ever Before

Despite hacks, leaks, and system failures, for-profit contractors are still getting lucrative intelligence contracts.


Almost 14 years to the day after the 9/11 terrorist attacks drove intelligence spending into the stratosphere, two of the largest business associations in the spying industry held a “summit” meeting to discuss the current state of national security. Two realities were immediately apparent.

First, US intelligence is more privatized than ever before, with for-profit corporations operating as an equal partner with the surveillance state at nearly every level. The situation was neatly summarized by James Clapper, the director of the Office of National Intelligence (ODNI) in his keynote address.

“If you can’t get a job in the IC, then sign on with one of our contractors,” he told the crowd of 500 people, 75 percent of whom came from the private sector. “Industry is absolutely crucial to our continued viability and success.” It was the first time in my memory I had heard a high-ranking official be so blatant about the stunning degree of contracting in US intelligence that I first exposed in 2007.

In an interesting twist, the former Air Force general even urged the 16 agencies he oversees to expand the revolving door as an incentive for a younger generation of people who “desire mobility” along with their government jobs “We must facilitate their ability to join the community, go to industry, get refreshed technologically, and then come back,” Clapper said. As most people in the room knew, this was the exact path he followed before jumping from the National Geospatial-Intelligence Agency (NGA) to take his job as President Obama’s intelligence chief.

But there was a second, more troubling theme that ran through the meeting. Americans are now more sensitive than ever before to the risks associated with contractors, from Edward Snowden’s leaking of NSA secrets to the recent hacking of a government database of 21 million federal workers that was supposedly protected by cybersecurity contractors.

Yet despite these failures, agencies and their congressional allies have ended any pretense of slowing contractor growth or increasing the government’s oversight—steps that were briefly considered when Snowden first revealed himself as a contractor in 2013. Instead, they have opted for self-policing through an internal security system that would make J. Edgar Hoover blush with shame.

Take Booz Allen Hamilton, which was Snowden’s employer when he leaked his trove of NSA documents to the US and British media. In response to Snowden and the penetrations of its system by the hacker group Anonymous a few years ago, it has undergone a “metamorphosis of security,” declared Art Davis, the company’s Director of Corporate Security.

He said Booz has doubled its spending on security by adopting a “full-scale counterintelligence program” focused on 2,500 employees with “access to the kingdom”—a reference to the highly classified documents that Snowden and Booz’s privatized army routinely handled. Such employees are subject to “continuous evaluation,” Davis said. “If they don’t pass, they leave their jobs.”

The meeting was organized by the Intelligence and National Security Alliance (INSA) and the Armed Forces Communications and Electronics Association (AFCEA). It offered a rare, albeit sketchy, look into the thinking at the senior levels of the key institutions of US intelligence, including the NSA, the CIA, the FBI, and NGA. It was sponsored by many of the powerful players in the intelligence industry, including CACI, SAIC, IBM, Amazon, Northrop Grumman, and Lockheed Martin, as well as a dozen smaller, less-known companies just getting started in the business.

The theme and political tone of the conference reinforced my own understanding of INSA as the representative of an intelligence “ruling class” that, due to its blending of national security and capitalism, has gained far more power than the military industrial complex of the Cold War. In a recent feature in these pages, I explained what I meant by “ruling class.”

These are the people—often referred to as “intelligence professionals”—who do the actual analytical and targeting work of the NSA and other agencies in America’s secret government. Over the last 15 years, thousands of former high-ranking intelligence officials and operatives have left their government posts and taken up senior positions at military contractors, consultancies, law firms, and private-equity firms. In their new jobs, they replicate what they did in government—often for the same agencies they left. But this time, their mission is strictly for-profit.…

Members of this dual public/private class rub shoulders at places like INSA, where they often meet behind closed doors to discuss classified programs. And even while making millions of dollars through their contracting and consulting gigs, these former officials advise the same agencies they profit from.

Not long after my piece was published, Joseph DeTrani, INSA’s president and a former top CIA analyst on North Korea, invited me to his offices in Arlington, Virginia, for an interview. During our conversation, he described INSA as primarily a networking organization that tries to be “as objective as we can” by producing monographs for both the IC and the public. Its primary purpose, he explained, is to provide “thought leadership” on intelligence issues by “drilling down” on complicated issues relevant to its 160 members. INSA “is not a stooge for the DNI or big industries,” he insisted.

He made some fair points. DeTrani, who has visited North Korea at least twice on diplomatic missions for the Obama administration, certainly holds some views that are at odds with some of his colleagues within US intelligence. I would also venture that INSA and AFCEA deserve credit for holding public discussions like this summit (where DeTrani presided over the plenary sessions and delivered remarks at the beginning of each day).

But at the conference itself, it was impossible to avoid the close embrace of contractors and their spy masters, the easy rapport created by years of swapping jobs between the public and private sectors, and the exclusion of skeptical or critical voices from the discussions. Nobody seemed to notice, for example, that DeTrani’s co-chair, Maureen Baginski, was NSA’s director of signals intelligence at the time of 9/11.

As the third person in the NSA hierarchy under Michael Hayden, she championed the disastrous Trailblazer data-mining program that wasted $7 billion and failed to detect conversations that could have signaled a pending attack. A debate between herself and one or more of the five whistle-blowers who exposed the Trailblazer fiasco to the Pentagon’s Office of Inspector General (currently the source of a major lawsuit) would have provided the audience with actual policy and moral choices.

There were some interesting moments, of course. When Clapper was asked at one point how Snowden’s NSA leaks had affected intelligence operations, he acknowledged that the exposure of NSA’s massive spying had “forced needed transparency” of intelligence operations. But at the same time, he argued that the leaks had caused “untold damage to foreign collection” efforts and “huge damage to our capabilities.” No surprises there.

Then there was a scowling John Brennan, director of the CIA, refusing to answer questions about Hillary Clinton’s e-mails from an over-eager moderator, Catherine Herridge, the chief intelligence correspondent for the Fox News Channel. Another highlight came when FBI Director Comey blasted critics of his efforts to prevent Apple and other tech companies from incorporating advanced encryption into their devices.

“The American people should be skeptical” of the government, he argued. “But when we try to explain the problem with universal encryption, we’re met with venom.” He didn’t specify anybody in particular, but his message was clear: please shut up and let us decide.

Exchanges like this were not the norm, however: The practical purpose of the summit was to smooth ties between business and government—and decidedly not to question the tenets of official policy.

In one of the sessions, Corin Stone, the NSA’s executive director, said her agency was here because “industry is moving at a heightened speed—if we don’t reach out, we’ll be left in the dust.” She likened its presence to the Pentagon’s recent forays into Silicon Valley, where NSA is “engaging lots of companies out there” to ensure that small businesses are brought into the system. Downstairs in the exhibition area, an NSA representative said he’d been “busy all day” talking with the dozens of companies who’d shown up (but he didn’t seem very prepared; all he had for handouts were blank memos embossed with the NSA logo).

At the same time, I couldn’t help but notice that nearly every speaker has gone through the spinning door I described in The Nation. Take the panel about security and counterintelligence. It was chaired by Charles Allen, a legendary officer from the CIA who ran the IC’s collection system when George Tenet was director. He left government in 2009 to become a principal of the Chertoff Group, the consulting company founded by Michael Chertoff, the former Homeland Security secretary, and the firm that Michael Hayden now calls home.

Davis, the Booz executive who described his company’s security plan at the panel, came to his position in 2012 after a career as head of security at the Air Force and the National Reconnaissance Agency, which runs the Pentagon’s secret satellite programs. Douglas Thomas, Lockheed Martin’s director of counterintelligence operations and corporate investigations, is another Air Force veteran who served in the Bush administration as deputy director of counterintelligence for the White House (he disclosed that Lockheed employs 65,000 people with security clearances, which would make it one of the largest intelligence agencies in the world).

After Thomas described his company’s extensive internal security program, William Evanina, the director of the National Counterintelligence and Security Center at the ODNI, noted that he has met with Thomas “a lot” about these issues. “We need to look to the private sector for ideas and innovations,” he said. “That starts with folks like [Thomas and Davis], who’ve left the square of government to go to the private sector.”

Carrie Wibben, the director of security policy for the Pentagon’s undersecretary for intelligence, noted that she had reviewed the Booz insider threat plan the day before. “People shouldn’t see this as big brother,” she assured the room, “but necessary for the world we live in.” Later, she added: “We need industry more than ever to get us where we want to go.” Davis responded in kind: “We are working together as one to make this country safer and better.” It was almost a love fest.

The ardor was apparent in one plan that got much play at the conference—a proposal by Clapper’s ODNI to expand “joint duty tours” beyond government to include industry. For years, intelligence officers have sharpened their skills by deploying from, say, the CIA to the NSA for a period of time, and then returning with a fresh understanding of how signals intelligence works; while at the sister agency, they retain their job title and get credit for federal pensions and other benefits. Now the ODNI is working on a plan to allow such transfers to a contractor.

Ellen McCarthy, the ODNI’s director for intelligence community activities, said the whole thing was Clapper’s idea. A former planning director for the imagery-focused NGA, McCarthy noted that her old agency currently has a top officer assigned to work temporarily at the contractor-funded United States Geospatial Intelligence Foundation. And she was proud that ODNI’s deputy director was hired from In-Q-Tel, the CIA venture capital fund that invests in companies creating technologies that might be useful for intelligence.

“We’ve realized that we’ve got to get our people out,” she said. “There’s nothing like seeing it from the other side,” added Suzanne White, the chief of staff for the Defense Intelligence Agency, whose workforce is about 30 percent contracted. (Meanwhile, I’m thinking, how about a stint at the ACLU?)

The big challenge for both government and industry seems to be getting young people excited about the possibilities in this privatized environment. Joan Dempsey, a Booz Allen executive who got her start listening to the conversations of Soviet bomber pilots from an NSA base in northern Japan, likened the search for talent to a counterinsurgency war.

“How do we win the hearts and minds of entry-level folks?” she asked, opening a panel titled “A public-private sector dialogue.” That’s difficult in part because of the vast use by millennials of cellphones and other electronic devices, replied the NSA’s Stone. “We’ve got to emphasize the mission,” she said. “We can work on things you can’t do anywhere else, and is usually illegal. But it’s legal here.” Plus “we can put you on the ground with the warfighter in Afghanistan. That’s something you won’t find anywhere else.” ODNI’s McCarthy was right there with her: “The mission is so incredibly cool about what we do.”

Cool, that is, if you’re into mass, privatized surveillance—and you’re ready to go to war. “I just got back from East Africa,” recalled Clapper. “It’s eye-watering to see what our intelligence people are doing there.” Foreign deployments, he said, are at their highest levels “since 9/11, and that’s brought a profound psychological change to the Intelligence Community. We’ve had thousands deployed to war zones multiple times.”

But nobody mentioned that at least six of them were killed in Afghanistan this year alone—three by a Taliban infiltrator at an Air Force base, and three by a suicide bomb in downtown Kabul. That may be the best indication that the line dividing government and business is thinner than ever.

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