U.S. Response I:  Poindexter to Resign Over Online Futures Trading Market

John Poindexter is expected to offer his resignation from the U.S. Defense Department’s Defense Advanced Research Projects Agency within the next several weeks, a Pentagon official said yesterday (see GSN, July 30).

Poindexter’s resignation was prompted by controversy surrounding a DARPA program to create an online futures trading market that would have allowed people to speculate on the likelihood of various types of terrorist activities.  The project, which was headed by Poindexter, was quickly canceled this week after details were released. 

The Pentagon official said he did not know if Poindexter’s resignation had been requested by senior Pentagon officials (George Edmonson, Atlanta Journal-Constitution, Aug. 1).

U.S. Defense Secretary Donald Rumsfeld said Wednesday that he decided to cancel the project “an hour” after he learned about it because of concerns that it would not be able to properly function with the surrounding controversy.

“Even if it happened to have been a brilliant idea, which I doubt, it would not have been able to function in the environment that it was created, so I cancelled it,” Rumsfeld said (U.S. Defense Department release, July 30).

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U.S. Response II:  Bush Administration Talking With Iran Over Al-Qaeda Operatives

The Bush administration is reportedly holding talks with Iran in an attempt to take custody of three senior al-Qaeda operatives held there, including an alleged expert on poisons, the New York Post reported today (see GSN, July 31).  The White House has denied, however, any “formal” negotiations (Ed Robinson, New York Post, Aug. 1).

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U.S Response III:  U.S. Senator Introduces Bill to Create Intelligence “Czar”

U.S. Senator Bob Graham (D-Fla.) introduced new legislation yesterday to create a Cabinet-level intelligence “czar” to oversee U.S. intelligence agencies, according to the Miami Herald (see GSN, June 26, 2002).

“The intelligence community needs a leader with the clout to set common goals, establish priorities, knock heads and, when necessary, assure that the American people are protected,” Graham said,

Graham’s bill would also require changes at the FBI, such as requiring the bureau to make counterterrorism one of its top priorities, improve information sharing with state and local officials and upgrade its information technology, according to the Herald.  The bill would also create a National Terrorist Watchlist Center to provide a database on suspected terrorists for both border security and law enforcement.

Senators Jay Rockefeller (D-W.Va.) and Dianne Feinstein (D-Calif.) cosponsored the bill.  Graham said he also expected Republican support for his legislation because it reflects the recent work of the House and Senate intelligence committees in investigating the Sept. 11, 2001, terrorist attacks (Frank Davies, Miami Herald, Aug. 1).

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U.S. Response IV:  Security Still Lacking at U.S. Chemical Facilities, Experts Say

By Margaret Kriz

National Journal

WASHINGTON — In a Rose Garden ceremony in July 2002, U.S. President George W. Bush unveiled his strategy for preventing terrorist attacks on U.S. soil. Flanked by key lawmakers from both major parties, he announced plans to create a Department of Homeland Security and released a report identifying the federal agencies designated to protect particularly vulnerable industries. The Environmental Protection Agency’s assignments included safeguarding the chemical industry and its hazardous materials.

“All of us agree,” the president declared at the time, “that protecting Americans from attack is our most urgent national priority, and that we must act on that priority.”

Then, in February of this year, his administration specifically warned that terrorists “may attempt to launch conventional attacks against the U.S. nuclear/chemical industrial infrastructure to cause contamination, disruption, and terror. Based on information, nuclear power plants and industrial chemical plants remain viable targets.”

But despite the Bush administration’s public promises and alarms, the White House has taken almost no action to improve security at any of the nation’s 15,000 facilities — including chemical manufacturing plants, petroleum tank farms and pesticide companies — that contain large quantities of potentially deadly chemicals. For that matter, the administration has done virtually nothing even to assess those facilities’ vulnerability, even though the dangers are far from theoretical: An accidental leak at a Union Carbide pesticide plant in Bhopal, India, immediately killed between 3,800 and 8,000 people in 1984 and, according to some reports, has since claimed an additional 12,000 lives. Closer to home, an accidental chlorine gas leak at a Honeywell refrigeration plant in Baton Rouge, La., on July 20 sent four workers to the hospital and forced 600 residents to stay indoors.

Counterterrorism experts shudder to think about the number of deaths an intentional release of a toxic chemical could cause. And the Bush administration’s inertia heightens their worries.

“These chemical plants have a vulnerability which has a catastrophic characteristic ... that could approximate the World Trade Center,” Rand Beers, a White House counterterrorism adviser for 30 years, told National Journal. Dissatisfied with the Bush administration’s approach to security, Beers resigned in March and now advises the presidential campaign of Senator John Kerry (D-Mass.).

Even though the EPA is the only federal regulatory agency with expertise in chemical safety, early this year the White House shifted responsibility for the chemical industry to the Homeland Security Department. That transfer followed industry complaints that the EPA, which was attempting to toughen federal security requirements, had become too demanding. Still struggling to get on its feet, Homeland Security has no authority to require the chemical industry to adopt stricter security measures. It also doesn’t have the money or personnel to inspect industrial plants for potential security problems (see GSN, June 18).

Thus, the Bush administration is relying solely on voluntary safety programs developed by chemical-industry trade associations (see GSN, April 8). But even if every member of those associations faithfully abided by the voluntary guidelines, two-thirds of the facilities that use or store high volumes of toxic chemicals would still be unaccounted for because they don’t belong to those groups, according to EPA officials.

The industry’s voluntary efforts do not satisfy Homeland Security Secretary Tom Ridge, who along with then-EPA Administrator Christie Whitman declared in an October 2002 letter to the Washington Post that “voluntary efforts alone are not sufficient to provide the level of assurance Americans deserve.” In a February 2003 letter to the General Accounting Office, the Justice Department warned, “The risk of terrorists’ attempting in the foreseeable future to cause an industrial chemical release is both real and credible.”

But the administration has given only half-hearted support to legislative efforts to force the industry to make itself less vulnerable. Since shortly after Sept. 11, 2001, Senator Jon Corzine (D-N.J.), whose state is dotted with facilities that use or manufacture vast quantities of hazardous chemicals, has been pushing legislation to require such companies to assess and improve their security. Corzine’s bill would also mandate that companies consider using safer alternatives to their current practices for manufacturing and storing chemicals (see GSN, May 13).

During the previous Congress, the Senate Environment and Public Works Committee unanimously voted for the Corzine measure. But the proposal died on the Senate floor after the chemical industry fought hard to block it.

This year, the panel’s new chairman, Senator James Inhofe (R-Okla.), is offering a less stringent chemical-industry security bill, which he wrote with the help of the Bush administration. The White House, however, has invested no political capital in getting it passed, and the bill has languished. Meanwhile, Representative Joe Barton (R-Texas), who chairs the House Energy and Commerce subcommittee with jurisdiction over toxic chemicals, contends that new regulations aren’t needed. “I don’t see a burning need to legislate,” Barton said in an interview. He stresses the difficulty of defending industrial plants against terrorism and the slim chance that any particular facility would end up being a terrorist target.

Calling Off the Watchdogs

Two weeks after Sept. 11, 2001, Whitman met with leaders of the chemical industry for a frank discussion about their industry’s vulnerability to terrorist attacks. EPA regulators already had some idea of the scope of the problem. Under the Clean Air Act, every company that uses or stores extremely hazardous chemicals is required to file an annual report explaining the steps it’s taking to prevent accidental releases of toxic chemicals and to protect the environment and nearby residents if a release does occur.

Based on reports from the 15,000 facilities required to submit that worst-case-scenario information, the EPA warned that a terrorist attack on any one of the 123 chemical facilities located in densely populated areas could expose 1 million people to toxic chemicals. An attack on one of 700 other facilities could threaten at least 100,000 people, and an attack at one of 3,000 other chemical sites could affect 10,000 people.

In the months after Whitman’s meeting, the EPA began developing guidelines for companies to assess their vulnerability to terrorism. Agency officials also seriously considered issuing new regulations to require the owners of all 15,000 of its “worst-case” sites to evaluate and improve security. Regulators planned to issue those rules under a provision of the Clean Air Act that authorizes the agency to control accidental chemical releases. Ultimately, though, the EPA feared that the chemical industry would sue and decided not to stretch the Clean Air Act to cover potential terrorist attacks. The EPA opted instead to go the legislative route and ask for more authority to mandate that the chemical plants better protect themselves.

EPA officials spent nearly a year working on a legislative proposal with the White House, the Office of Management and Budget and various federal agencies. The major sticking point was whether the legislation should require companies to consider using safer chemicals and technologies.

“EPA initially said that one of the things facilities ought to at least look at as part of a comprehensive vulnerability assessment is whether there are steps they can take to reduce the hazards that are present at the site,” recalls a former EPA official who was involved in the debate. “If they’re storing a six-month supply of a hazardous chemical, would they be less vulnerable to attack if they only kept a one-month supply on site? If they were using a highly toxic chemical, is there a less toxic replacement?”

Industry lobbyists forcefully fought the idea of a law requiring companies to consider safer alternatives. “It creates too big a door for federal micromanagement of the decisions that facility operators are making on a day-to-day level,” said Rob McArver, director of government relations at the Synthetic Organic Chemical Manufacturers Association, a trade group representing 300 fairly small companies.

“Chemical companies make dangerous things,” added Greg Lebedev, president of the American Chemistry Council, which represents 180 giants of the chemical manufacturing industry. “Getting into the technology of what you make and how you make it is a subject for an environmental or technology context, not security. I don’t want us to wander down an exotic path here.”

In late 2002, the EPA further enraged industry by announcing plans to inspect the chemical plants it considered most vulnerable to an attack. The agency asked more than 30 companies to voluntarily allow EPA inspectors to tour their sites. At least two refused. The inspections that were undertaken, EPA officials say, found that safeguards varied widely. Some companies were aggressively improving security; others were doing nothing.

The EPA’s attempts to lay the groundwork for an aggressive security program proved to be its undoing. In early 2003, the White House responded to industry protests by pulling the EPA off the chemical site security beat. The administration quietly shifted oversight to Homeland Security. Since then, industry officials and administration sources say, the federal government has done little to gauge the security at chemical plants.

The only concerted action on chemical plant safety is coming from the industry’s trade associations. The American Chemistry Council has been widely praised for a voluntary program in which it asks members to assess and upgrade security and to hire an independent auditor to judge their success. Complying with the council’s plan is now a prerequisite for membership in the group and in the Synthetic Organic Chemical Manufacturers Association. The American Petroleum Institute and several other trade associations have endorsed the approach, but aren’t requiring members to follow it.

Despite the laurels the American Chemistry Council program won, industry association officials say more needs to be done — even if not by their members. “We have a bit of a vacuum,” Lebedev says. “The EPA doesn’t do anything because that’s not what they do. DHS is still pulling itself together from all sides of Washington just to make itself into a reasonably homogeneous agency. No doubt it isn’t doing very much there.” Lebedev said his group now supports legislation to give Homeland Security the power to require chemical companies to conduct vulnerability assessments and improve their security. But he wants Congress to essentially exempt companies that have adopted the American Chemistry Council’s plan.

Oil industry officials argue that most petroleum companies don’t need — and haven’t waited for — a federal mandate to guard against terrorism. “There is no government agency now that can go in and order people to do these assessments,” said American Petroleum Industry spokesman Michael Shanahan. “But it’s in the self-interest of industry to protect itself.”

Perhaps so. Several recent reports, however, raise questions about how aggressively corporate America is responding to the threat of another major terrorist attack. A July 9 survey by the Conference Board, a New York City-based business research group, found that since Sept. 11, 2001, U.S. companies have increased their spending on security an average of only 4 percent. Other studies by the Brookings Institution, Rand, the Congressional Research Service and the Progressive Policy Institute also raised serious questions about security problems at chemical plants and other high-risk facilities with large amounts of hazardous material.

Environmentalists are suspicious of the chemical industry’s assurances that its facilities are doing enough. They cite dozens of instances in which news reporters or activists were able to walk into a chemical plant site or oil refinery without being stopped by a guard or barrier.

“We won’t have a complete picture of the safety at these facilities until the DHS has the resources and inclination to require all facilities to submit their security plans and then analyzes those plans,” said Jon Devine of the Natural Resources Defense Council.

Rick Hind, legislative director of Greenpeace’s toxics campaign, belittles the American Chemistry Council program as “PR eyewash.” The chemical industry’s promises, he said, are “lulling the Bush administration into complacency or overconfidence. So while the world seems to be gaining in reasons to hate us, we seem to be ignoring an entire sector of our infrastructure that sticks out like a sore thumb to terrorists.”

On July 23, Corzine offered an amendment to the Homeland Security appropriations bill that would have provided $80 million for the department to assess the security at chemical facilities nationwide. The amendment was tabled on the Senate floor.

Soft Spots?

Corzine says he is frustrated that Congress has balked at ensuring the safety of plants that use and store vast quantities of potentially lethal chemicals. “It strikes me,” he said in an interview, “that there is just no willingness to move here. Almost two years after Sept. 11, it’s hard to believe that if we’re committed to homeland security, we have not addressed something that everybody recognizes is among the top threats.” Corzine said he’s looking for “every possible avenue” for getting his proposal written into law. For example, he might offer it as an amendment to the Senate energy bill, which is now on the Senate floor.

Last year, industry lobbyists blocked Corzine’s bill after they rallied trade groups — ranging from the Chlorine Chemistry Council to the Agricultural Retailers Association — to fight the measure as unnecessary government interference. Corzine describes that defeat and industry’s continuing effort to water down his bill as “a classic case of the special interests trumping the public interest.”

Early this year, Corzine reintroduced his bill with Senator James Jeffords (I-Vt.), the ranking minority member on the Environment and Public Works Committee. Meanwhile, Chairman Inhofe drew up his own chemical-security legislation with input from the administration. In May, Inhofe announced plans to mark up his measure. But he didn’t have the committee votes to pass his version, which critics say wouldn’t go far enough to protect chemical facilities sites. Inhofe’s bill would not require companies to submit vulnerability or sercurity-improvement plans to Homeland Security. It also would not require companies to consider using alternatives to current chemicals and practices.

After a short, unsuccessful flurry of negotiations between Democrats and Republicans, Inhofe’s version was shoved onto a back burner until the committee completes work on the transportation reauthorization bill, which is considered a top priority because it will bring political pork to lawmakers’ financially strapped home states. The White House is pushing Inhofe to take up its proposed rewrite of the Clean Air Act immediately after Congress’s summer recess. If the chairman agrees, action on his chemical security measure could be delayed yet again.

Meanwhile, Corzine’s bill has gone through several iterations since he introduced it. His first proposal would have put the EPA in charge of chemical-plant security. Inhofe strongly objected to that provision, arguing that the agency is “notorious” for failing to keep the chemical industry’s secrets.

“The whole idea is security,” Inhofe said in an interview. “And we can cite a lot of examples where people inside EPA leaked information. Ultimately, it could fall into the hands of the wrong people.”

Corzine’s current version would give Homeland Security responsibility for the chemical-security program. But the battle continues over Corzine’s desire to encourage industry to use inherently safer technology at the chemical facilities. Inhofe and industry lobbyists strongly oppose that approach.

Corzine sees that mandate as critical. “I’m staying with it,” he said in an interview. But he added, “You know, at some point I’d just like to see fences put up and be certain that they’re being monitored. I’d like to make sure that chemical facilities on waterfronts have some control over access from the water.

“If you take a boat ride up Arthur Kill, between New York and New Jersey, you’d be shocked at how little security there is on the water side of those plants. It strikes me as absolutely an abject failure to address one of the serious soft spots in our communities.”

Republicans, however, tend to be inclined to give the chemical industry the benefit of the doubt on security issues. Several current and former Bush administration staffers said that the White House simply isn’t interested in creating a massive program for inspecting chemical plants. And House Energy and Commerce Committee Chairman Barton said that although he’s monitoring the situation, he sees no need for tough new chemical security requirements in the aftermath of Sept. 11, 2001.

“The problem you have in an open society is that it’s physically impossible to make any large industrial site terrorist-proof,” Barton said in an interview. “If there are enough terrorists who are dedicated enough and equipped well enough, they’re going to overwhelm everything that you put up short of some sort of Fort Knox — which doesn’t make much sense, given the cost and the relatively remote possibility that any specific site is going to be targeted.”

Security experts counter that while it might be unlikely that any particular chemical facility will be attacked, it is not unrealistic to think that some chemical facility will be targeted. At a June summit on chemical-industry security, FBI special agent Troy Morgan, a specialist on weapons of mass destruction, warned that chemical tank farms risk being turned into a “poor man’s atomic bomb.”

“You’ve heard about sarin and other chemical weapons in the news,” Morgan was quoted as saying in the Pittsburgh Tribune-Review. “But it’s far easier to attack a railcar full of toxic industrial chemicals than it is to compromise the security of a military base and obtain these materials.”

Former White House counterterrorism adviser Beers contends that the Bush administration ought to enhance security at chemical plants. “There are so many possible vulnerabilities that to some degree it’s a very difficult task to try to sort among them all,” he said. But he suggested that government mandates would level the playing field between companies that are investing in security and those that are gaining a competitive edge by not spending the money. “This is one problem they can do something about,” he said. “Why isn’t it being done?”

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Threat Assessment:  British Panel Says Iraq Invasion Hurt War on Terror

A British parliamentary committee said yesterday that the invasion of Iraq might have hampered the war on terrorism, the Associated Press reported (see GSN, July 31).

Before invading Iraq, U.S. leaders implied that Baghdad was linked to the al-Qaeda terrorist network, according to AP.  British leaders said at the time that the danger of weapons of mass destruction falling into the hands of terrorists justified the war.

The panel said “the war in Iraq might in fact have impeded the war against al-Qaeda” and the invasion “might have enhanced the appeal” of the terrorist group (Beth Gardiner, Associated Press/Salon.com, July 31).

The Commons Foreign Affairs Select Committee said al-Qaeda remains a “significant threat” to Britain.

“We cannot conclude that these threats have diminished significantly, in spite of regime change in Iraq and progress in capturing some of the leaders of al-Qaeda.  Those that remain at large, including Osama bin Laden, retain the capacity to lead and guide the organization toward further atrocities.  Al-Qaeda has dangerously large numbers of foot soldiers and has demonstrated an alarming capacity to regenerate itself,” the committee said (Ben Russell, London Independent, Aug. 1).

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Threat Assessment:  Bush Warns of “Real” Al-Qaeda Threat

U.S. President George W. Bush said yesterday that the United States is facing genuine terrorist threats from the al-Qaeda terrorist network, warning that terrorists might attempt to hijack airplanes in a Sept. 11-style attack (see GSN, July 29).

“The threat is a real threat,” Bush said.  “We don’t know when, where, what.  But we do know a couple of things.  We know that al-Qaeda tends to use methodologies that worked in the past,” he added.

Washington recently issued a security advisory to airlines.

“We’re focusing on the airline industry right now, and we’ve got reason to do so,” Bush said.  “But I’m confident that we will thwart the attempts,” he added.

U.S. officials were not convinced, however, that the current threat is credible.

“If we were certain this was real, I think you’d see us raise the alert level, as we’ve done in the past,” a senior law enforcement official said.  “We’re not at that point yet.  This could be more disinformation,” the official added.

Homeland Security Secretary Tom Ridge said that his department was putting extra resources toward safeguarding the nation’s airlines (Philip Shenon, New York Times, July 31).

The information that led to the airline warning came from Ali Abd al-Rahman al Faqasi al-Ghamdi, an al-Qaeda operative who planned suicide bombings in Saudi Arabia and is currently being held in Guantanamo Bay, Cuba, CNN.com reported (CNN.com, July 31).

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U.S. Response:  Pentagon Cancels Online Futures Market Project

The U.S. Defense Department yesterday canceled a plan to create an online futures trading market that would have allowed people to speculate on the likelihood of various types of terrorist activities, according to the Washington Post (see GSN, July 29).

Tony Tether, director of the Defense Advanced Research Projects Agency, which was overseeing the project, said in a statement that “it simply did not make sense to continue” the project “in light of the recent concerns surrounding” it.

The project, called the Policy Analysis Market, would have allowed people to deposit funds into accounts and then win or lose money by predicting various crises, such as a North Korean missile attack, in an attempt to anticipate events.  The initial registration of up to 1,000 participants was set to begin Friday, with trading to have begun Oct. 1, according to the Post.

The determination to cancel the program was echoed by Deputy Defense Secretary Paul Wolfowitz, who told a Senate hearing that he had first learned of the project by reading the newspaper.

“I share your shock at this kind of program,” Wolfowitz said.  “We’ll find out about it, but it is being terminated,” he said.

Wolfowitz also sought to defend DARPA, saying it “is brilliantly imaginative in places where we want them to be imaginative.”

“It sounds like maybe they got too imaginative in this area,” Wolfowitz added.

Wolfowitz’s comments resulted in harsh words from Senator Barbara Boxer (D-Calif.), according to the Post.

“I don’t think we can laugh off that DARPA program,” Boxer said.  “There is something very sick about it.  And if it’s going to end, I think you would end the careers of whoever it was who thought that up,” she added (Graham/Loeb, Washington Post, July 30).

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International Response:  Security Council Committee Urges Greater Compliance With Counterterrorism Measures

By Jim Wurst
Global Security Newswire

UNITED NATIONS — The chairman of a U.N. Security Council sanctions committee said yesterday that while progress has been made to ensure that al-Qaeda and the Taliban cannot operate in various countries’ territory, some nations — including those where the two groups are likely to be operating — have not met their counterterrorism obligations (see GSN, Feb. 21).

Ambassador Heraldo Munoz of Chile, the chairman of the committee monitoring the sanctions against al-Qaeda and the Taliban, told the council, “Recognition of the possible presence of al-Qaeda or those associated with the network within its territory appears to be a stigma to some states.  Consequently, detailed information concerning the activities of al-Qaeda … is not being presented to the committee.”

Resolution 1267 of October 1999 imposed sanctions on Osama bin Laden and al-Qaeda for their alleged roles in terrorist acts, including the bombing of U.S. embassies in East Africa, and on the Taliban for harboring al-Qaeda.  Countries are supposed to enforce a travel ban, a freeze on financial assets and an arms embargo against individuals and groups on a council list of suspected members of the two groups.  Munoz chairs the council’s committee that monitors compliance with 1267 and Resolution 1455, adopted in January 2003, which tightened the sanctions on the two groups.

Resolution 1455 requires countries to submit reports on the implementation of the sanctions.  However, only 64 countries — “barely 30 percent of the membership of the United Nations” — have submitted those reports, Munoz said.  “Individuals or entities associated with al-Qaeda are believed to be active in some way in a significant number of the states that have not yet submitted a report,” he added.

He did not name the countries he was referring to.  The council’s tally of submissions show that Afghanistan and some neighboring countries, as well as other countries where the al-Qaeda may be operating, including Indonesia, have not submitted reports.  However other countries where the network may be present, including Saudi Arabia, Malaysia and Pakistan, have submitted reports.

U.S. Ambassador John Negroponte said, “We emphasize that states unwilling to implement their obligations, whatever the reason, must be encouraged and, if necessary, pressured to do more.  The international community cannot allow intransigence by some to be the weak link that undermines our shared counterterrorism efforts.”

Munoz added that “if there are significant absences in the reporting” on implementing sanctions, then “the committee will have no choice but to reflect this reality as it prepares its year-end” report to the council.

A primary tool in combating al-Qaeda — interrupting its finances — is proving to be difficult, Munoz said.  “Al-Qaeda has a built-in resilience and flexibility, which is contributing to its survival as a global network,” he said.  “This, in turn, encourages support of the network among elements of the population in many countries, producing sympathy for the ideology, new recruits to the movement and funding.”  Informal banking systems and the use of charities and aid groups as conduits for illegal funds continues, he said, therefore “states must be encouraged to ensure effective measures are put in place to stop such humanitarian activities from being, in any way, abused by al-Qaeda operatives.”

Munoz, as well as the ambassadors of Colombia and India, linked terrorist financing to the illicit drug trade, saying there is ample evidence of drug trafficking around the world financing a variety of terrorist organizations.  Mu¤oz said that “funds may easily get to the al-Qaeda network” through the Afghan opium trade.

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U.S. Response I:  Pentagon Creates Online Futures Trading Market to Predict Terrorist Activities

The U.S. Defense Department’s Defense Advanced Research Projects Agency is establishing an online futures trading market that would allow people to wager on the likelihood of various types of terrorist activities, the New York Times reported today (see GSN, July 28).

The program, called the Policy Analysis Market, would allow people to deposit funds into accounts — similar to those used in stock trading — and then win or lose money by predicting various events, such as a coup in Jordan, according to the Times.  The market will focus on the economic, military and civil futures of eight Middle Eastern nations, including Iran, Iraq and Israel, as well as the results of U.S. interactions with those nations.  The program is set to begin registering an initial 1,000 participants Friday with trading to begin Oct. 1.  The number of participants could possibly grow to 10,000 by Jan. 1, the Times reported.

“Involvement in this group-prediction process should prove engaging and may prove profitable,” the market’s Web site said.

The Pentagon has said that similar futures trading projects have been able to predict events such as oil prices and elections.

“Research indicates that markets are extremely efficient, effective and timely aggregators of dispersed and even hidden information,” the Pentagon said in a statement.  “Futures markets have proven themselves to be good at predicting such things as elections results; they are often better than expert opinions,” the department said (Carl Hulse, New York Times, July 29).

More than $800,000 has been spent to establish the market, according to the Washington Times.

However, congressional critics of the program have called on John Poindexter, director of the Total Information Awareness office, which will oversee the program, to shut it down, saying that gambling on future terrorist attacks is “grotesque.”

“The federal government is encouraging people to bet on and make money from atrocities and terrorist attacks,” Senator Ron Wyden (D-Ore.) said during a press conference to disclose the program.  “Betting on terrorism is morally wrong,” he said.

“It’s a harebrained scheme,” said Senator Byron Dorgan (D-N.D.).  “I think this is an unbelievably stupid program that is so devoid of value.  It is offensive to almost everyone,” he said (Audrey Hudson, Washington Times, July 29).

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U.S. Response II:  GAO Says Port Security Needs Long-Term Plan

By David McGlinchey
Global Security Newswire

WASHINGTON — As part of its efforts to enhance security at U.S. shipping terminals, the Homeland Security Department must increase the number of well-trained port security officials, a task that could prove difficult without advanced strategic planning, the General Accounting Office said in a report yesterday (see GSN, June 17).

The Bureau of Customs and Border Protection — part of the Homeland Security Department — has not yet managed a smooth transition in port security efforts from “short-term focus to a long-term strategic approach,” according to the GAO report.  The GAO called for a comprehensive plan for developing a skilled port security workforce.

Last year, U.S. customs officials launched the Container Security Initiative, which posted agents in foreign ports to screen high-risk shipments for weapons of mass destruction before they departed for the United States.  Under the CSI program, more than 10 nations have agreed to participate in the program, according to the Customs and Border Control Web site (see GSN, July 23).

More than 1,700 companies also agreed to join the Customs-Trade Partnership Against Terrorism (C-TPAT), under which firms improve their own security in exchange for smoother access to U.S. ports.

Senator Charles Grassley (R-Iowa) applauded the GAO findings and said port security relies on well-trained customs officials.

“The success of these programs, and our trust in them, depends largely on the quality, training, oversight, and retention, of the people on the ground who administer them.  Going forward, we have to have a good roadmap in place.  It’s that simple,” he said in a statement.

The GAO called for customs officials to develop “human capital plans that clearly describe how CSI and C-TPAT will recruit, train and retain staff to meet their growing demands as they expand to other countries and implement new program elements.”

The plan also called on the Homeland Security Department to develop benchmarks for the two programs to measure their progress.

“The measures should be used to determine the future direction of these Customs programs,” the report says.

In addition, the GAO said that Homeland Security officials should build strategic plans to identify the programs’ goals and reach them.

The Customs and Border Protection bureau agreed with the GAO report and said it was already addressing the problems.

“The Office of International Affairs has initiated action to develop a program to recruit, train and retain the staff necessary to effectively and efficiently carry out the mission of the CSI,” the bureau said in a statement.

Grassley said he was encouraged by the fact that customs officials agreed with the GAO assessment.

“The additional steps identified in the GAO report are crucial to the successful management and long-term success and oversight of these programs,” he said.

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Threat Assessment:  Officials Warn of New Hijacking Attacks

Al-Qaeda is believed to be preparing to conduct a new round of attacks using hijacked airliners later this summer, U.S. officials said yesterday (see GSN, July 10).

Officials have learned of the suspected plot through interrogations of one or more captured senior al-Qaeda operatives, according to the Washington Post.  Information received from al-Qaeda operatives has been corroborated through other methods, such as electronic intercepts, officials said.

“The U.S. intelligence community has received information related to al-Qaeda’s continued interest in using commercial aviation here in the United States and abroad to further their cause,” Homeland Security Department spokesman Gordon Johndroe said.

Homeland Security issued an alert with the new information to law enforcement agencies, security officials and airlines over the weekend, Johndroe said.  There are no immediate plans, however, to raise the U.S. national terrorism alert level, which currently stands at “yellow,” indicating an elevated risk, Homeland Security officials said (Susan Schmidt, Washington Post, July 29).

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U.S. Response:  “Murky” Intelligence Can Be Basis for Action, Wolfowitz Says

U.S. Deputy Defense Secretary Paul Wolfowitz defended yesterday the Bush administration’s decision to invade Iraq, arguing that the government must be able to act on “murky” intelligence when necessary (see GSN, July 25).

No conclusive evidence has yet been found to support the frequent Bush administration claims about Iraqi weapons of mass destruction and links to terrorism.  The Sept. 11, 2001, terrorist attacks, however, demonstrated a need to act on the basis of “murky” information to prevent future attacks, he said.

“The nature of terrorism is that intelligence about terrorism is murky,” Wolfowitz said on Fox News Sunday.  “I think the lesson of 9/11 is that if you’re not prepared to act on the basis of murky intelligence, then you’re going to have to act after the fact, and after the fact now means after horrendous things have happened to this country,” he said (Anton Ferreira, Reuters/Philadelphia Inquirer, July 28).

U.S. Senator Carl Levin (D-Mich.) yesterday criticized Wolfowitz’s use of the word “murky” to describe prewar U.S. intelligence on Iraq.

“Boy, it sure didn’t sound murky before the war,” Levin said on CBS’s Face the Nation.  “There were clear connections, we were told, between al-Qaeda and Iraq.  There was no murkiness, no nuance, no uncertainty about it at all. ...  That’s the way it was presented to the American people,” he said (William Mann, Associated Press/Yahoo!News, July 28).

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