Segment 2 Of 2     Previous Hearing Segment(1)

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THREATS TO UNITED STATES NATIONAL SECURITY

House of Representatives,

Committee on National Security,

Washington, DC, Thursday, February 12, 1998.

    The committee met, pursuant to call, at 9:30 a.m., in room 2118, Rayburn House Office Building, Hon. Floyd D. Spence (chairman of the committee) presiding.

OPENING STATEMENT OF HON. FLOYD D. SPENCE, A REPRESENTATIVE FROM SOUTH CAROLINA, CHAIRMAN, COMMITTEE ON NATIONAL SECURITY

    The CHAIRMAN. The meeting will please be in order. Before proceeding, I would like to formally congratulate the gentleman from Missouri, Ike Skelton, on his election by his peers to the position of Ranking Member. There is no stronger advocate for a smart, capable and cost-effective defense and we all look forward to working with you in your new capacity.

    [Applause.]

    The CHAIRMAN. I also want to welcome our newest member, Congresswoman Kay Granger from Ft. Worth, TX.
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    Ms. GRANGER. Thank you.

    The CHAIRMAN. Kay has been working hard to get on National Security for a few years now and I am certainly glad she succeeded. We all look forward to working with her.

    We have before us today two distinguished former directors of Central Intelligence. Both of our witnesses have well deserved reputations in dealing with both defense and intelligence issues, and I am glad they are both here with us today.

    Our witnesses are Dr. John Deutch, who served as President Clinton's Deputy Secretary of Defense and then CIA director and Ambassador James Woolsey, who served as the President's first CIA director. Welcome officially, gentlemen, and thank you for taking time from your busy schedules to be here with us today.

    Last year at about this same time, we received testimony from several former CIA directors, including Ambassador Woolsey. Last year's hearing was very productive and informative. I personally find it helpful to receive a broad overview of the evolving national security environment at the outset of the budget cycle.

    In this regard, I would like to draw the members' attention to the fact that, in addition to today's hearing, we are also scheduled for a closed briefing with the intelligence community on February 25. The question of what threats and challenges the United States faces now and will face in the future is at the heart of all of our deliberations of our nation's security.
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    I have taken exception with the Administration's Bottom Up and Quadrennial Defense Review (QDR), most fundamentally for being budget, not threat and strategy driven. So, I believe that hearings like this morning's are particularly important for the committee, as we begin deliberations over the fiscal year 1999 defense budget.

    Several years ago, in the immediate aftermath of the cold war, there was an optimism among some that the United States no longer faced any significant threats in the world. Some even speculated that the centuries long pattern of conflict between nations had ended and that conflicts between peoples and nations would become obsolete.

    Less than a decade has passed since the collapse of the Soviet Union, but it is already clear that the world will remain a very dangerous place. Rogue states like North Korea, Iran, Iraq are no longer restrained by a bi-polar superpower balance of power, and increasingly desperate due to their isolation and growing internal economic and political problems, are perhaps more threatening to their neighbors and to our interest than they were during the cold war.

    Ethnic, tribal and religious balance has been a constant feature of the post-cold war that we are faced with and our troops have been sent on more than one occasion to respond to what the Pentagon refers to as smaller scale contingencies. One of these, in Bosnia, has become a large scale commitment that promises to be the central mission of our forces in Europe for years to come. The list of peacekeeping commitments continues to grow, from the Sinai to Haiti to Somalia to Rwanda.

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    Nor has the end of the cold war brought an end to great power competition. China, economically backward and poorly armed throughout most of the cold war, is using its robust economy to modernize both its conventional and nuclear forces. China currently has more strategic missiles under development than any other nation. Beijing and Moscow claim to have buried their cold war hostility and formed a strategic partnership. Unfortunately, this partnership entails significant transfers of advanced weapons and military technology from Russia to China and Chinese support of Russian political goals, such as opposition to NATO enlargement and to possible United States military action against Iraq.

    Russia's future is far from certain as democracy is not yet firmly established. Indeed, according to a study last year headed by William Webster, former director of the CIA and the FBI, Russia is fast becoming an unstable kleptocracy, armed with nuclear weapons.

    Perhaps most disturbing of all, unprecedented threats are likely to arise from the proliferation of missiles and weapons of mass destruction. I heartily agreed with President Clinton's warning raised in his State of the Union speech that international predators will be all the more lethal if weapons of mass destruction fall into their hands.

    But, it is going to be difficult to make our international agreements and arms control treaties to address this problem or problems.

    Of our potential enemies during the cold war, only the Soviet Union and China had the capability to strike United States cities with missiles. But now, ballistic missile technology is proliferating at a rate faster than ever before. We may well be surprised by a missile threat that can reach the United States from countries like North Korea or Iran sooner than expected, before the United States can deploy a cost effective missile defense.
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    We have already been surprised by North Korea's development of a No Dong medium range missile, which poses a serious threat to Japan and our troops stationed there. Last month, CIA Director George Tenet testified in the Senate that, ''Iran's success in gaining technology and materials from Russian companies, combined with recent indigenous Iranian advances, means that it could have a medium range missile much sooner than I asserted last year''.

    Last year, the CIA concluded that Iran might develop a medium range missile in less than 10 years. Now, we are told that Iran might have such a missile in 18 months. While Director Tenet acknowledged the substantial difference between the two estimates, the rapidly evolving nature of this threat indicates just how uncertain and dangerous the post-cold war really is.

    Therefore, I look to our distinguished witnesses to enlighten us on these trends, threats and challenges this nation faces in the years ahead. Gentlemen, once again, I look forward to your testimony, but before we begin, I would like to recognize the committee's new ranking Democrat, Mr. Ike Skelton, for any remarks he would like to make.

    [The prepared statement of Mr. Spence can be found in the appendix on page 43.]

STATEMENT OF HON. IKE SKELTON, A REPRESENTATIVE FROM MISSOURI, RANKING MEMBER, COMMITTEE ON NATIONAL SECURITY

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    Mr. SKELTON. Thank you so much, Mr. Chairman. First, thank you for your kind words of a few moments ago. Allow me, Mr. Chairman, to join you in welcoming our distinguished guests to address this committee about the threats to the national security of our country, Jim Woolsey and John Deutch, old friends of yesteryear, are veterans in the national security business with experience in a variety of Government positions, reaching back more than two decades.

    Today's hearing will also help set the stage for the hearing in 2 weeks when the deputy director of Central Intelligence and the director of the Defense Intelligence Agency come before us to give their worldwide threat briefing.

    Two decades ago, the complexities of the cold war dominated security and defense concerns of American national security decision makers. Those days are gone. Today, because of expanding technologies and more fluid international order, the business of intelligence is more complex than ever before.

    The challenges are numerous—proliferations, rogue states, terrorism, China, Russia, drug trafficking, the security of information systems, regional hot spots, humanitarian crises and others. This hearing provides the public an opportunity to hear about these challenges and also gain a greater appreciation for the difficulties that policy makers confront today in attempting to make responses to these challenges.

    One word of caution. Last year, James Schlesinger noted the tendency at times to overstate the threat. He cited the issue of oil and access to oil, which was a critical national issue in the 1970's. It is interesting to see how this issue has receded in importance since that time.
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    Mr. Chairman, we must address the threats, maintain our perspective and rank them in some order of priority.

    On a more personal note, this is my first appearance as the ranking Member of the National Security Committee. It is an honor and a privilege offered me by my Democratic colleagues. My goal is to provide for the common defense.

    Allow me to make three points. The first, I believe, that national security and defense policy should be bipartisan. The men and women in uniform whom we support by our efforts here serve the national interests, not any partisan or political interests. That has guided my efforts in defense matters over the years. We should be ever mindful of the men and women who wear the American uniforms; their welfare and their ability to perform successfully should be our polestar. I want to work with my colleagues on both sides of the aisle, senior and junior alike, in this important effort.

    Second, I want to work with both the President and Secretary of Defense in these matters. I may not always be able to, but that will always be my first inclination as it has been since I first came to Congress. I have a great appreciation for the heavy burdens we ask these two gentlemen to carry. Individuals who hold these two positions can bring about positive change. Abroad, the cold war is over. At home, our national finances are back in balance, however, much work remains to be done, as our witnesses will remind us today.

    Finally, I want to work with the Chairman and all my colleagues here to promote the effectiveness and influence of this committee. I believe in the importance of the committee to set the agenda, to conduct oversight and to set spending levels. This committee is the buckle of the belt between the Department of Defense on the one side and the Congress as a whole on the other. We make the case for those important DOD policies and programs with our colleagues in this body. At the same time, we also provide the Department of Defense an estimation of what the traffic will bear.
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    If we are to remain relevant in this process, we need to pass our bill on time and not get hung up as we did last year. I want to work with the Chairman as much as possible in this important effort.

    Mr. Chairman, thank you for holding this hearing. I look forward to the testimony of our two witnesses. Thank you.

    The CHAIRMAN. Thank you, Mr. Skelton. Before we begin, without objection, I would like to announce that both of your statements can be submitted for the record and with that, Mr. Deutch, do you want to proceed?

STATEMENT OF THE HON. JOHN DEUTCH, INSTITUTE PROFESSOR, MASSACHUSETTS INSTITUTE OF TECHNOLOGY AND FORMER DIRECTOR OF CENTRAL INTELLIGENCE

    Mr. DEUTCH. Thank you very much, Mr. Chairman. It is a great pleasure to appear once again before this committee, especially as a private citizen, a person who has his own thoughts and does not live in area code 202.

    I want to review very briefly for the committee the judgments that I have about the security challenges our country faces and also to highlight a few defense and intelligence programs that I believe deserve this committee's strong support.

    First of all, Russia. Russia should continue to be our top security concern, even though we do not have the same adversarial relationship that we had during the cold war. Why? Because Russia still possesses 20,000 plus nuclear weapons and at the same time, there is widespread corruption, the absence of honest and accountable government in Russia, absence of administrative functions which are slowing Russia's erratic and periodic movement towards a democratic government and a market-oriented economy.
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    Thus, it is critical that we follow internal political developments in Russia most carefully and we must also follow as carefully as possible Russian foreign policy activity, for example, as the chairman mentioned, relations with Iran, which are an indicator of Russian attitudes toward the United States and the West.

    United States cooperative threat reduction efforts, which have been supported by the Congress and most of which are funded in the Department of Defense budget are accordingly of continuing importance. The objective of these efforts is to lower the risk of loose nukes by reducing the number of active nuclear weapons and strengthening Russia's ability to manage, control and account for their nuclear stockpile in their strategic nuclear materials. Those programs deserve the support of this committee.

    Second in order of priorities is China. In contrast to Russia, China has adopted a very different strategy, a strategy which is based on economic liberalization while maintaining absolute internal political control. Whether this strategy is viable over the long term remains to be seen. For example, it is questionable whether China will be able to successfully re-engineer its vast state owned enterprise. So, for the next decade, we must have very modest expectations about China's development and, in particular, our ability to influence Chinese development and modest expectations about our ability to come to agreement on issues that are more important to us than they are to them—non-proliferation, trade, human rights and the environment.

    So, it is unclear in the long term how United States-China relations will evolve. Therefore, it is of paramount importance for the United States to maintain a very strong presence in the Pacific region and strong alliance relationships, most particularly with Japan. The uncertain future on the Korean peninsula and the situation with respect to Taiwan reinforces this need for a forward presence by the United States military in the Pacific and strong alliance relationships.
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    Third, let me speak about Iraq, Iran and other rogue countries. The past two Administrations have adopted a dual containment policy towards Iran and Iraq. I think we all recognize that for quite different reasons, neither of these policies has been a smashing success.

    In the case of Iraq, while Saddam is increasingly militarily constrained by the United States and its coalition of partners, he continues to be a major threat to security in the region and the cause of misery among the Iraqi people. Finding an alternative to Saddam Hussein should remain a high priority for U.S. policy.

    Because Saddam continues to frustrate international inspections, there is good reason to believe that our allies and our coalition partners will, to some extent, assist in our efforts to thwart production of weapons of mass destruction in his country.

    On the other hand, Saddam Hussein enjoys and continues to enjoy considerable sympathy in the Middle East and elsewhere. He remains politically strong because of his skill in balancing competing political interests in the regime. I understand that this committee is interested in my views on the potential of air activity against Iraq in the near future. Let me say quite bluntly that I think that the Administration is doing exactly the right thing, as it considers. It is exploring with its allies the use of U.S. air power against Saddam.

    On the other hand, I think the problem of Iraq is a very difficult one, indeed, and it will not be solved magically by an air campaign. We should understand clearly what is possible and what is not possible, what should be expected and what should not be expected from air operations.
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    Let me first say what I believe can be expected by an air campaign against Saddam Hussein. First of all, it is a notice to Saddam Hussein and his government that he cannot thumb his nose at U.N. inspections. Second, the air strikes will inflict damage both on Iraqi military establishment and destroy some known and suspected weapons of mass destruction sites.

    Third, these air strikes, I believe, will indirectly encourage Iraqi anti-Saddam Hussein elements, wherever they may be, inside the country or elsewhere, so that the air strikes indicate to those who oppose Saddam Hussein, those Iraqi's who oppose Saddam Hussein, that the United States stands against his tyranny, as well.

    But, what will air strikes not do? That is just as important to understand. I do not believe that an air campaign will topple the Saddam Hussein regime in the short run. We cannot expect that even a very extensive air campaign will lead to his removal from power. Second, an air campaign is unlikely to destroy all the stocks of biological or chemical agents or missiles that Saddam Hussein has. In any event, even if they were able to destroy all these stocks, many of these capabilities could be rapidly rebuilt by Saddam Hussein after the cessation of the air strike.

    There are those who call our approach to air operations against Iraq as sending a very soft signal, as not sending the right kind of signal. I disagree with that assessment. I think it sends an important signal, and I would also ask the committee to remember that doing nothing would send an even worse signal around the world to what behavior Saddam Hussein has recently exhibited in his unwillingness to permit U.N. inspections to go forward.

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    Let me turn next to Iran. The situation with Iran is quite different than Iraq. Despite a clear record of sponsoring terrorism and advocating extremist Islamic separatist policies, our European allies, Japan, Russia, and others, have shown progressively less willingness to attempt to influence Iranian behavior by the use of sanctions, especially as opportunities to do business with Iran loom larger.

    Without denying either the record of Iran or the character of Iranian policy, I believe it is time to begin to explore replacing the current policy of containment with a policy of measured engagement, where step-by-step political and economic normalization would accompany verifiable progress on key issues: Cessation of state sponsored terrorism, cessation of work on weapons of mass destruction, support for the Middle East peace process and greater respect for the individual. There is some indication of as yet uncertain value that Iran is receptive to an alternative approach. We shall see, but we should explore.

    While there are significant differences between those nations and others that we classify as rogue states, Libya and North Korea, none of them have abandoned their efforts to acquire greater nuclear, chemical and biological capability. Accordingly, I urge this committee to continue to support the counter-proliferation programs of the Department of Defense.

    Finally, terrorism. Terrorism is a growing threat to our governmental infrastructure, to international business and to our citizens both at home and abroad. There is a new character to this terrorist threat. It is the possibility that terrorists will use weapons of mass destruction. It is the growing international scope of terrorists organizations and terrorist activities and third, it is the vulnerability of our critical government infrastructure, the telecommunications and control systems that regulate everyday life to interference by terrorist organizations.
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    Now, there is widespread awareness of the foreign terrorist threat in the United States today and in the government, but progress in marshalling efforts to protect us against these terrorists' threats remains, a lot remains to be done. The roles of the different government agencies involved in combatting terrorism—Defense, Intelligence and Law Enforcement—must be better defined and effective counter-terrorism programs must be put into place. But, I think this committee should understand fully that foreign terrorism is a national security threat. It is not only a law enforcement matter and therefore, it needs the oversight and the interest of this committee, as the other major national security threats that the Nation faces.

    Thank you very much, Mr. Chairman, for your attention. I look forward to trying to respond as best I can to the questions you and others may have. Thank you, sir.

    [The prepared statement of Mr. Deutch can be found in the appendix on page 48.]

    The CHAIRMAN. Mr. Ambassador.

STATEMENT OF THE HON. R. JAMES WOOLSEY, FORMER DIRECTOR OF CENTRAL INTELLIGENCE

    Mr. WOOLSEY. Thank you, Mr. Chairman. Mr. Chairman, if it is alright, rather than reading my statement, I will speak to it in somewhat summary form.

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    It is a great honor to be invited to testify before you again this year. I am going to limit these remarks to what I would regard as the salient threats to American security, serious damage to the country, such as would be caused by an attack on us or a major war. There are a number of other interesting and important threats, in a sense, which we can discuss in questions, if the committee is interested.

    One important preliminary matter. During the cold war, we became very accustomed to talking about threats and even validated threats and this was possible because the Soviet Union was, at least in its weapons development and the planning of its military operations, a relatively predictable place with respect to development, doctrine, military plans. We could focus our intelligence on key nodes, test ranges, on recruiting a Polish officer as a spy on the Warsaw Pact staff to steal their war plans and so on.

    We got to be used to the idea that we should really only respond to reasonably clear extrapolations of what we, in fact, saw. That was not an irrational approach during the cold war, because of the nature of our enemy and because we had to economize and spend money on what was truly important.

    But, this approach, in my judgment, needs to be substantially modified in the post-cold war era. People such as Saddam Hussein and Kim Jong Il are far more unpredictable and irrational than the Soviet leaders ever were. It is dangerous, I believe, to assume that military developments and deployments in regimes such as these are going to follow some relatively predictable pattern.

    I said on a number of occasions, and my staff, when I was DCI, used to wince when they heard it because they heard it so often, that we were in a situation similar to that of having struggled with a dragon for 45 years and killed him and now finding ourselves in a jungle full of a lot of poisonous snakes. That, in many ways, the snakes were much harder to keep track of than the dragon ever was.
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    I think that is the essence of the problem. Just as Holmes used to say, in order to understand the law, you have to look at it as a bad man would, and in order to understand the post-cold war era, we must all try, and it is a very difficult task, indeed, to look at the world through the eyes of a Saddam Hussein or a Kim Jong Il.

    Now, starting with Russia and China, these are the only two countries that can destroy the United States today within the 30 minute flight time of an ICBM. I believe that fundamentally, with Russia and China today, the United States need have no fundamental serious strategic differences with Russia at all, and with China, the one underlying one, where we are likely to have a serious strategic difference is the future of Taiwan or, at least, China's potential attempt to resolve the Taiwan issue by force.

    But, nonetheless, neither of these two countries is in a stable situation yet. Both are in considerable political and economic flux and neither has established the rule of law. It is therefore, I think, quite important for us to look at the problems that might arise in the future with them and the problems that do exist today.

    One of the most serious aspects of the current situation in Russia is that the degree of corruption and the fiscal problems of the Russian state have created a very poor state of morale, pay and behavior inside the Russian military forces. The conventional forces, most of them, are in worse shape, but even the strategic rocket forces are not immune to these problems.

    There are some uncertainties that the general staff and the strategic rocket forces face with respect to nuclear weapons. First of all, because their conventional forces are in such poor shape, the Russians are moving toward a doctrine of potential first use of nuclear weapons and a much higher reliance on nuclear weapons than they had before. Tongue in cheek, I might say they are adopting the views of the early Kissinger, circa late 1950's, early 1960's, with respect to reliance on nuclear weapons. They have lost some important warning systems that are outside Russia that were in the Soviet Union, but are not in Russia, and it is quite troubling to contemplate what might happen in some crisis if there were a misunderstanding, such as there might have been in part with respect to the famous recent incident of the Norwegian sounding rocket.
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    We, ourselves, in the United States, have had command post exercises in the Strategic Air Command once or twice over the years temporarily mistaken for the real thing. And, in one famous incident many years ago, when Khruschev was actually inside the United States, a brand new radar in the ballistic missile early warning system tracked the rising of the moon as a flight of incoming Soviet ICBM's. The Canadian general who was on duty at NORAD looked at his television screen, saw that Khruschev was in the cornfields or Disneyland or wherever and said, this just cannot be true.

    But, the point is, that in times of tension it is plausible that something most unexpected could happen. I believe that the lessons for us from that circumstance with respect to Russian nuclear forces is the importance of discussions with the Russians to try to find ways to ameliorate this situation, but also, at least in my judgment, a vigorous approach toward ballistic missile defense for the United States, at least to the level that could deal with unauthorized and accidental launches.

    A second problem with Russia is that many of those who managed the Soviet Union's security establishment, whether in technology, intelligence or in military expertise, are now for hire on both the white and the black markets. This makes Russia a serious source of proliferation, for example, to Iran as the chairman mentioned. A recent series in Izvestia spoke in some detail about senior Russian military officers having provided assistance to Aum Shinrikyu, prior to Aum's chemical attack in the Tokyo subway.

    One of the most difficult aspects of all of this is the inter-penetration of the security services, organized crime and some aspects of Russian business. If any of you are in Geneva, let us say, or Vienna sometime in the next few years and you should run into a very well dressed, prosperous looking Russian, let us say, a $2,000 suit and Gucci's and he says to you that he wants to talk to someone in the states about a joint venture for the export of oil or some other purpose, he may be what he says he is, a businessman. He may be a Russian intelligence officer under commercial cover. He may be a senior member of some organized crime group. But, what is really interesting is that there is at least some chance that he is all three, and indeed, that none of those three institutions has any particularly serious problem with that.
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    China presents the case of a dictatorship that has successfully begun a major economic modernization, but the disruption that will likely occur as the inefficient state owned enterprises are shifted in their organization and employment structure and the regional tensions that this sets up in China, along with other economic difficulties between the prosperous South and Coast and the less than prosperous North and Interior could lead Chinese leaders to take refuge, even more than they have in the past, in nationalism. The focus of nationalism for them is likely to be to regain Taiwan.

    This is the one issue which I think might cause a major rupture between the United States and a nuclear power which today could threaten the United States. After we demonstrated, I believe, weakness and vacillation for several years, in my judgment, the Chinese were genuinely surprised two years ago when they launched ballistic missiles into the waters near Taiwan and the United States, in fact, responded by sending two aircraft carriers.

    But, I think the lesson of that period is that it is dangerous to give China reason to doubt our resolve on this issue of the importance of a peaceful resolution of any differences in the Taiwan straits. A Chinese invasion of Taiwan is not really in the cards for many years. They lack the lift and the relevant types of military capability, but the seizure of one or more of the offshore islands, ballistic missile attacks using conventional warheads with excellent guidance, such as GPS, against targets in Taiwan, these are some of the types of things that could create a crisis and a confrontation with China.

    I want to speak briefly to three rogue governments, North Korea, Iraq and Iran. Except during our periodic crises in the Mideast, the Korean Demilitarized Zone remains the most likely place in the world for the United States to get involved in a land war. There are several situations that create a serious risk that the North might expect some types of early successes and lead Kim Jong Il, even with the decrepit state of his nation, to try some wild throw of the dice.
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    The concentration of North Korean forces close to the DMZ, the concentration of South Korea's population in industry on the southern side of the DMZ, some imbalances in military capability, particularly South Korea's sparse investment in artillery and some North Korean capabilities, such as their special operations forces, their possession of ballistic missiles equipped with chemical and/or bacteriological weapons, the initiation of operational status for the No Dong, which could conceivably threaten our bases in Japan——

    The CHAIRMAN. Mr. Ambassador, we are going to have to pause right here and take a break and go vote. We will be right back.

    Mr. WOOLSEY. Surely. Fine.

    [Recess.]

    The CHAIRMAN. The meeting will please be in order. Mr. Ambassador, we apologize for the break to vote, but that is the nature of the beast we deal with. You can proceed as you would like.

    Mr. WOOLSEY. Shall I continue, sir?

    The CHAIRMAN. Yes, sir, proceed as you would like.

    Mr. WOOLSEY. We have seen our military force structure erode since the gulf war, Mr. Chairman, and although there have been some important improvements in capabilities such as smart weapons, nonetheless, I think particularly from this committee's point of view, it is important that our capacity to fight two major regional wars simultaneously must be said to be in doubt.
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    If we are engaged in the Mideast at some point in hostilities, doubtless Kim Jong Il will notice. And, if we are engaged in Korea, doubtless Saddam will notice. If the Taepo Dong 2 missile has been developed and deployed by the time of any crisis or war on the Korean peninsula, the situation could be grave, indeed, because it would probably be able to reach at least some cities in Alaska, carrying possibly a bacteriological warhead. It is not unimaginable that the North Koreans would be able to produce one or two nuclear warheads from the fissionable material they were probably able to acquire from the earlier operation of their reactor. But, in many cases, bacteriological will do just as well as nuclear for a weapon of blackmail.

    So, although in any war of duration, the decrepit nation of North Korea would not be able to prevail against the combined forces of the United States and South Korea, the threat of a quick grab of the northern part of South Korea is a serious one, I believe, as long as this North Korean state and military pull together. If there were a simultaneous crisis in the Mideast or if the Taepo Dong 2 were developed and deployed, the situation could be extremely grave.

    I would add, North Korea, of course, remains a very dangerous and serious proliferator, as well as creating these other direct threat problems.

    The conclusion I draw from this is that theater and national ballistic missile defense for the United States and several important improvements for South Korea's defenses, especially artillery, are quite important.

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    Second, Iraq. Certainly, Saddam has proven his willingness to take risks. He has proven his ruthlessness and his lack of feeling for his own people and his stubbornness. The two fundamental problems are that Iraq sits on or near a huge share of the world's oil. In the late summer of 1990, Saddam was about 100 miles away from controlling over half of the world's proven reserves. Saddam doubtless holds at least stocks of chemical and bacteriological weapons and the means to deliver them against our friends and allies and against U.S. forces in the region, and the capacity to rebuild that capability, even if it is taken from him.

    The problem is seriously complicated, in my judgment, by the fact that there are no easy fixes to this situation, by a short bombing campaign or by any other means. Even in the unlikely event that Saddam agreed to full and complete U.N. inspections and even if his supplies of chemical and bacteriological weapons, his capacity to produce them and his ballistic missiles were destroyed by inspectors or by air attack, if the inspections ceased, and they would have to be very, very vigorous inspections indeed, he would soon be capable of reaching some degree of devastation again.

    For example, SCUDs are available in many places in the world, especially to a country that has billions of dollars of oil revenue annually, and it is only a little harder to make anthrax than it is to run a small microbrewery, a parallel that was drawn by the Deputy Director of the Advanced Research Project Agency in the Pentagon in an excellent paper, unclassified paper, on bacteriological warfare, which I would urge that this committee seek and review.

    Anthrax is relatively easy to make and the manufacturing equipment and the stocks for bacteriological and chemical weapons can be disbursed, can be hidden from inspectors, can be hidden from intelligence collection, perhaps in deep bunkers that even advanced and accurate conventional weapons cannot destroy.
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    I believe the problem with Saddam has been made worse by our flaccid responses in 1994 to the Iraqi Intelligence Service's attempt to assassinate former President Bush and in 1996 to Saddam's murderous assault against the north. He has doubtless concluded that almost no matter what he does, he will only have to endure air strikes for a limited period of time and that he can use those to rally support, especially in the Arab world.

    Thus, in my judgment, it will do little good only to try to use air strikes to delay and disrupt the Iraqi capability to manufacture and use weapons of mass destruction for a limited period of time. Air attacks may show some success to that end, but Saddam will doubtless force innocent civilians to be placed at likely attack points or even kill them himself and claim that U.S. air strikes were responsible. In a few months, there would be a new crisis.

    The fundamental problem is the Ba'athist Regime which Saddam heads and it seems to me that is the problem we must confront. As a shorthand, we often speak of Saddam as the problem and this focus on the individual can even lead to such proposals as I believe are extremely irresponsible when made by former senior Clinton administration advisor George Stephanopoulos in December that the United States provide ''direct support'' for a ''inside job'' to assassinate Saddam. In addition to being illegal under the current governing executive order, impractical and destructive of much of what we try to stand for in the world, such an effort, even if successful, would be quite likely to give us another Ba'ath Nationalist of Saddam's tribe.

    Instead, I believe we need a solid program to break the power of Saddam's regime. Some elements of that program could include air strikes, but we should try to maintain our forces in the region for a sustained period of time in a condition to attack so that we can achieve some surprise at some point. An attack now against what are doubtless dispersed weapon stockpiles would be less likely to be effective. Republican Guard is also now probably dispersed to help make air attack against it less effective, and we would want to make sure that we attack in such a way as to cause maximum damage to the Republican Guard, since it is much of the source of the regime's power.
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    Yet, as I understand the current position of the Administration, it suggests that only attacks against weapon stockpiles are now being contemplated. The commanding general has more broadly spoken about attacks against the instruments of power in Saddam's regime, which I believe is a much better formulation. But, given the Administration's statements, in my view, limited strikes, especially if executed at a time that Saddam expects them, would succeed in doing very little that is useful. If air strikes occur within the next few weeks, this may be the most telegraphed punch in military history.

    There are other important components to break the power of the Iraqi regime and I believe they should be undertaken promptly. They could include destroying the Iraqi air defense system by air strikes and then establishing and maintaining a no-fly zone over the entire country, a step which would make it much harder for the regime to move Republican Guard forces quickly by helicopter to counter rebellions by dissident regular forces in the future, such as have happened in the past.

    It might also include recognizing a government in exile, providing vigorous air protection for the Kurds in the north, which we did not do 2 years ago, and the Shia in the south, which we did not do in 1991 against the regime.

    Now, it will be said by some that many members of our once effective gulf war coalition would not support such steps. But, it seems to me that the United States has more success in building coalitions when it takes firm, clear, sustainable positions than when it plays for short-term publicity or sending signals with military forces. It is aggravating in the extreme that the Saudis will apparently not permit us to conduct air strikes from Saudi territory, but we must understand that the Saudis or anyone else in the region cannot reasonably be expected to support pinprick air attacks such as in 1994 and 1996 or even longer bombing campaigns that merely retard Saddam's program for weapons of mass destruction.
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    They must then continue to live next door to the angered viper, while we are free to withdraw thousands of miles away. A decisive and coherent long-term program to bring down the Ba'athist Regime in Iraq, of which air strikes from time to time may well be a very important part, seem to me to be the only course of action at this point that has any chance of success.

    Briefly, on Iran, Mr. Chairman, unlike the case with the Iraqi regime, I believe that the threats that are potentially posed by Iran may plausibly be ameliorated by peaceful means. Now, this is far from certain, but it is much more likely now that the reigning clergy, centered around Ayatollah Khamenei has seen the dramatic rejection of their candidate for president and the overwhelming vote of the Iranian people for President Khatami in the last election. Now, President Khatami has very little formal power, especially over the military and the instruments of state power, such as the Iranian Intelligence Service that continues to provide substantial aid to Hezbollah and other terrorist groups.

    But, nevertheless, in spite of the rule of those in the clergy who support terror at home and abroad, there are important forces in Iran who want better relations with the West, even with the United States. There is something there to work with. I believe it is a major error to blame Islam or Shia Islam for the state of affairs in Iran today. The limited number of clergy, I believe a minority of the Shia clergy, have designated themselves as rulers under the doctrine of the walayat al-faqih of Ayatollah Khamenei, but I believe there is ample evidence that they do not represent the majority opinion even of the Shia clergy in Iran.

    Nonetheless, Iran is a terrorist state. It is a state that rules by force. It is a state that conducts terrorist operations abroad and that is seeking to acquire ballistic missiles and weapons of mass destruction, recently, with rather substantial Russian help.
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    In my judgment, one of the most important lessons of what is happening in Iran with respect to its weapons programs is that it will, before long, be a threat to our friends and allies in the region and that whatever we decide to do about the ABM Treaty, we should not even be discussing limitations on theater systems with the Russians.

    Terrorism, finally. The risk that terrorists might use weapons of mass destruction in my view constitutes the number one threat to our national security. Much attention has been focused on fissionable material and small, stolen nuclear weapons, both in government planning and in the media and these are important, and the Nunn-Lugar and other steps that the Congress has adopted to approach and deal with this problem are of substantial contribution to national security.

    But, the most troubling threat, I believe, is biological weapons. They may be quite small, they may be much more easily constructed, even than a crude nuclear weapon, and the raw material for some of the most fearsome ones such as anthrax is readily available. Indeed, it grows in a number of cow pastures in the world, unlike fissionable material, which requires a great deal of effort to produce.

    Biological or chemical weapon terrorism could be undertaken by purely domestic sources, such as another Timothy McVeigh or a group with similar views. It could be undertaken by a group inside the United States that is inspired by individuals from abroad, such as the blind sheikh conspiracy in New York. It could be undertaken pursuant to covert encouragement by a foreign government through an intermediary organization, such as Iran working through Hezbollah. It could be undertaken directly by a foreign intelligence service, possibly as a false flag operation, in which Iranians masquerade as Iraqis or Iraqis masquerade as Iranians, and it could even be undertaken by special military forces of a foreign country, for example, with a diesel submarine covertly launching a land attack cruise missile with a biological warhead, or a freighter launching a SCUD.
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    Each of these types of terrorism, whether using biological weapons or some other, requires different responses. For example, for purely domestic and many foreign inspired domestic threats, the FBI's ability to penetrate such groups with informants is the main line of defense. For terrorist operations that are planned or launched from abroad, espionage managed by the CIA or acquired by intelligence sharing between the CIA and friendly intelligence services is really the only likely source of advance warning.

    In the case of biological weapons, once an attack has been launched, the availability of sensors to detect it promptly and medication that can be administered quickly to large numbers of people could mean the difference someday between, say, hundreds of casualties in such an event and hundreds of thousands of casualties in such an event.

    Today, unfortunately, there are a number of terrorist groups, both foreign and domestic who, for ideological or religious reasons, are not seeking a place at the table. They are seeking to blow up the table and to kill everyone sitting there. It is important for us to realize that the nature of some of these groups, Aum Shinrikyu is only one example, and the widespread information about terrorist techniques on the Internet and otherwise, creates a radically new terrorist situation compared to even the recent past. There is no silver bullet that will stop terrorism, but there is a major need for a thorough and coordinated U.S. Government response.

    A final thought, Mr. Chairman, about oil. Although I disagree rarely and with trepidation with my old and good friend, Jim Schlesinger, as his remarks at least were mentioned earlier, I would want to say this. Although there are several circumstances that might pose serious threats to the United States and I have mentioned some, confusion in the command and control system of Russia, a confrontation with China over Taiwan, a war on the Korean peninsula, a domestic terrorist threat, a number of the near and long-term threats to the United States seem to be centered in the Mideast and the importance of the Mideast is driven by two facts.
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    First, if you add the Caspian Basin to the Persian Gulf, it sits on approximately three-quarters of the world's known oil reserves. Second, the states that control almost all of this oil are either governed today by psychopathic predators or by vulnerable autocrats. Moreover, for historical reasons going back to the period after World War I and earlier, there is a great deal of resentment against the West, including now, particularly against us and Israel and the whole region is a potpourri of religious extremism, economic stagnation and large populations of unemployed youths. Some wealthy individuals such as Usima ben Laden are freelance sponsors of terrorism and work on weapons of mass destruction with millions and millions of dollars at their disposal.

    Finally, Asia is quite likely, even with its current economic difficulties, as it grows and urbanizes, to increase substantially the world's demand for oil in the next century. A projection two years ago in Fortune Magazine calculated that once China and India reach what is today South Korea's level of energy consumption per capita, which would be several decades, because South Korea is still a very prosperous country, nonetheless, at that point, those two countries alone would require almost 120 million barrels of oil daily, given their current consumption patterns. The whole world today uses just over 70 million barrels a day.

    These huge types of jumps in oil consumption probably are not going to occur because something will intervene by way of alternatives and the like, but the point is, the pressure will be there and we will at least see an increase and probably a substantial increase in the tens to hundreds of billions of dollars that now flow to the Mideast to hundreds of billions to trillions through the first half of the next century. These funds, because of the nature of that region, are going to support governmental and private activity that, in many cases, are not in the United States' interest, to put it mildly.
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    So, not as a matter of promoting autocracy in the United States, Mr. Chairman, at all, but as a matter of world stability, I can think of no single, more important long term strategic issue than finding some way to reduce the world's dependence on Mideast oil. Thank you.

    [The prepared statement of Mr. Woolsey can be found in the appendix on page 52.]

    The CHAIRMAN. Thank you both, gentlemen. Both of you have mentioned various possibilities for threats in the future emanating from different sources. Today, especially, we are talking about maybe air strikes against Iraq and whether that would do the job or not, and the real possibility of North Korea deciding to act if we do get involved in Iraq or more to the point, probably Iran, our current strategy is being able to fight two nearly simultaneous major regional contingents at one time.

    Do you think that's a good strategy to have and could we do that right now, on that strategy? Is our force big enough to do that?

    Mr. WOOLSEY. I think it is a good strategy, particularly given the nature of events in North Korea and in the Mideast, but the key word in that formulation is near, because there is a lot of stretch in that word. If we can fight solidly and clearly two major regional wars, that is one thing.

    But, if we are planning on resources for one theater, whether naval or lift or other, to take some substantial amount of time working in one theater before they could be used in the other, I think that the danger of simultaneous crises or even hostilities in the Mideast and Korea is substantially enhanced. As I said, I think Saddam will notice if we are at war in the Korean peninsula and Kim Jong Il will notice if we are at war in the Mideast.
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    I have not studied the structure of American military forces as carefully over the course of the last several years, Mr. Chairman, as I have foreign threats, but my general impression is that we are getting quite thin, indeed, and that it is essential that we have more than what is barely enough to be able to deal with those two types of contingencies.

    Mr. DEUTCH. Mr. Chairman, I do not believe the country has any choice but to prepare for two nearly simultaneous conflicts. If we do not do so, getting involved in one would invite bad conduct by the other. So, deterrence requires us to look at a strategy with supporting force structure and programs for entering into two nearly simultaneous regional conflicts.

    The question you asked is, Do we have the forestructure, is that forestructure ready? Do we have the procurement to back up that forestructure to assure that we can fight two nearly simultaneous conflicts, given the nature of the threat that we face?

    In the short run, I would give a fairly positive answer to the question. Despite the fact that our forces are stretched with their involvement in a number of different areas of the world, which they certainly could not be if we were involved in a regional conflict, I do believe that the forestructure and the current level of readiness today is sufficient for that objective of deterring, which is what we want, deterring regional conflicts by being able to prepare for two nearly simultaneous conflicts.

    The issue really is long term. In the long term, two things happen. The first is the nature of the threat may change, a peer competitor may emerge, a strong China, an aggressive Russia or some other combination of Mideast forces, so the threat could be grander than it is today, the conventional military threat on the one hand. We also face the problem that our procurement as well, though, is not keeping pace with the necessity to rebuild and replace our military equipment and capital.
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    So, that has to be faced in the long run. There is not one solution to that problem. It involves more money for procurement, but it also involves better business practices within the Department of Defense and it involves, importantly, a much greater use of technology, the precision munitions that Jim Woolsey spoke about, coupled with the technical intelligence, which will permit force commanders to have knowledge of where the enemy is.

    So, there are many, many solutions to the problem. I do not think that it is by any means foregone that we are able to manage this. But, it is going to take attention. In the short run, I believe we are OK. In the long run, work has to be done to lift the procurement budget especially.

    The CHAIRMAN. Thank you.

    Mr. Skelton.

    Mr. SKELTON. Thank you. In light of the fact that we want our more junior members to ask questions, I will limit my question, Mr. Chairman, to one. I would like each of you to comment briefly on it.

    In light of the alleged cooperation or assistance as evidenced by the article in the Washington Post today that Russia is giving Iraq regarding weapons of mass destruction, what should be our short range and long range concerns?

    Mr. WOOLSEY. I think it is important for the American people and government to understand that when we had Mr. Scheverdnadze as the Soviet foreign minister, we had a man whom I believe understood that he ultimately was doing a good thing for the world by bringing the power of the Soviet state to a close and entering a new era.
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    When we had Mr. Kozyrev as Russian foreign minister, we had someone who was sympathetic to and understood the values and ideas of the West. My former counterpart, Mr. Primakov now, as foreign minister, is an altogether different individual. He is close personally to Saddam Hussein. He has, in my judgment, although he is personally charming when he wants to be, no good will at all for us or Western values. He is the central figure in the structuring of Russian foreign policy, I think, at the moment. He believes it is important to stay close to China, Iran, Iraq, Libya and to undercut the influence of the United States when that can be done.

    And, there has been an important change in Russian foreign policy and it's been downhill, I think, over the course of the last number of years. I think Mr. Yeltsen rules Mr. Primakov with a relatively loose hand and I believe that it is important and useful for us to be extremely blunt and extremely clear with the Russian Government when they either permit, through inattention or covert direction, steps such as assistance to Iran or Iraq or any other rogue state of the sort that has been reported.

    I do not believe that the current posture of generally accommodating Russian objections is one that is geared to serve our interests over the long run.

    Mr. DEUTCH. Very briefly, Mr. Skelton, I do not live in Washington, so I have not read the Washington Post. I found it the most delightful answer I could think of giving. [Laughter.]

    I will say with respect to Russian-Iran relations, which I have paid some attention to, I think they have to be looked at carefully, first of all, because there is a growing jointness of interest between Iran and Russia for the sales that Russia can have of technology of all sorts and military systems to Iran, but also because of the Caspian Sea oil problem, a very important coming together of interests.
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    But, as I said in my opening remarks, it is important that we look in an unvarnished way at Russian foreign policy conduct, because it signals what their attentions are in their relationships to the West and the United States. So, these particular subjects of Russian-Iran relationships and the story which I have not read about Russia-Iraq indicates the importance of keeping one's eye on these developments.

    The CHAIRMAN. Mr. Hansen. Mr. Hefley.

    Mr. HEFLEY. Thank you, Mr. Chairman. You know, this thing in Iraq is a scary situation. First of all, Mr. Chairman, I would like to say these witnesses have given us one of the most enlightening experiences we have had of this nature in a long time, and I appreciate both of you very much for your very candid and open responses.

    Can you help us understand how serious the Saddam threat really is to us and what might be going on in his mind? I mean, he knows we can obliterate his country if we chose to do it. I mean, we have proven that we could do that. He must assume we are not going to do that, so what would be the purpose in what he is doing, from your viewpoint, and what happens if we do attack him, even on a limited basis? What does this do to the rest of the Arab world in terms of their relationship with us and in terms of stimulating additional terrorist behavior on the part of people from there who are part of the United States, maybe internally within the United States? This really is a scary thing.

    Then, third, and both of you have spoken to it some, but if you could elaborate on it a little, is how much damage to his ability to produce and use weapons of mass destruction are we likely to do with air strikes? It seemed to me that with all of the hoopderah about the smart weapons, smart bombs, put them down a chimney, put them in a window, that kind of thing, that we really destroyed very little of his war making capacity from the air strikes, including very few SCUD missile batteries did we actually destroy. Maybe I am wrong about that, and you can correct me if I am.
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    So, what will we really accomplish, except maybe solidifying him as the underdog that is standing up for my country and solidify the regime, if we actually do attack?

    Mr. DEUTCH. Can I answer? These are all extremely important questions and they're questions which I think are on every responsible individual in Congress and the Administration at the current time. Let me see if I can make a few comments on them, which I hope will be helpful.

    First of all, I believe Saddam Hussein is an extremely intelligent person who calculates very carefully the consequences with something that he undertakes and he calculates those consequences realistically, and he looks at both the cost and the benefit.

    When he thumbs his nose at U.N. inspectors, he knows full well that he risks and probably will endure an air strike, air operations from the United States and from our coalition partners, those who choose to work with us, like the British. So, he has calculated that, he has done that for two reasons, in my judgment.

    The first is, he does not care about the damage that it does to the people in his country and the loss of activity of his economy. He has demonstrated that full well, so one thing, he does not care about the civilian costs.

    He believes that his military can absorb yet another damaging blow and I will come back to that in one moment. That is on the negative side. He does not care about the people and he believes especially his Republican Guard can be protected from too much damage. Then, he looks for the benefit that this cost, as you point out, the benefit that it creates for him politically first in the neighborhood, in Turkey, Syria, Saudi Arabia and more broadly, in the Arab world. He does all of that calculation.
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    What about the character of the air strikes? The air strikes, when combined to an ever-more tightening no fly zone policy, does, indeed, constrain his military. His military is, indeed, harmed by these air strikes. If the target packages, which I have no knowledge of today, include both attack on military targets and attack on suspected or known sites where biological or chemical activity is going on and you couple that with an expanded no air strike policy, you are certainly creating more pressure, which has already been increased on reducing his military capability. It is not the case that his military capability, especially air capability, is the same today that it was in 1994 or 1991 or certainly before the gulf war.

    So, these attacks do have an effect, but you are also correct in saying they are not going to bring instant popularity for the United States along the average Middle Eastern Arab person. They will bring respect, they will bring more respect than if we do nothing. Because if we do nothing, it is an even clearer signal to the very difficult and complex community that no one is standing up when Saddam Hussein says, I am sorry, I am keeping my weapons and biological warfare or my chemical weapons or my SCUD missiles that can only create the worst kind of destruction in the neighborhood.

    So, on balance, as difficult as this is, I think it is—and there are no easy solutions here. It does say, yes, he has calculated the cost and benefits. There are some costs to an air campaign, but I think from the point of view of the Iraqi people, from the point of view of peace, at least stability, from the point of view of United States' interests, consideration of these air operations is more important than not. I hope that was helpful to some degree, sir.

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    Mr. WOOLSEY. I would just say very briefly, one of the key things about Saddam to realize is that, before he was a dictator, he was a hit man. That is what he did for a living was kill people, and he has no interest in the Iraqi people. He wants to maintain himself in power and to increase his power as much as he can.

    If you think of dealing with a particularly ruthless Mafia Don, and I do not mean someone as benevolent as Brando played in the first Godfather. I mean, a really ruthless Mafia Don, then I think that is essentially the proper image.

    I think the attacks, the air attacks, will have a negative effect on our standing in the Arab world, because of the sort of brotherly fellow feeling for Saddam, in spite of his being the bad boy of the Arab family, and I think that is why it is important if we are going to use air strikes or military force as a whole, to use it decisively. Combined with the political program to delegitimatize his regime, combined with a long term program of establishing a no fly zone over the whole country, combined with attacks on the Republican Guard, then maybe there will be some utility in going after the sites of weapons of mass destruction. But, I think going after those sites alone for a few days or even a week or two is not an effective program.

    The CHAIRMAN. Mr. Sisisky.

    Mr. SISISKY. Thank you, Mr. Chairman and welcome to both of you gentlemen. We have known each other for a good number of years and you have testified probably more than anybody in front of this committee and we welcome you very warmly today.

    You used the word, Jim, blunt.
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    Mr. WOOLSEY. Blunt?

    Mr. SISISKY. Blunt, you know, in talking to the Russians. This is not my question, but I want to make a comment about it, because I think it is important. I attended this past weekend, formerly called the Wehrkunde Conference. They call it now European Security, for the last 34 years. Before we went into Munich, into the sessions, we went to Bosnia and we decided that we were going to be very blunt first speaking with Mr. Kohl from Germany. He spoke for about an hour and then we asked questions for about an hour and a half and then he comes back and the first question out of the box was Senator John McCain, and if any of you know him, you cannot be more blunt than he is, and I mean, he was blunt.

    Here we are in Bosnia, which is closer to Europe than it is to the United States, obviously, and here we are in Iraq and we cannot get any cooperation from our friends. Mr. Kohl came right back and said, you will get cooperation from Germany. The point I am making is, sometimes you have to be blunt and you are particularly right.

    John, you made the statement and obviously, you are out of the ring now, about being able to fight two major regional wars. I submit to you, even today in the Pacific, we talked about Korea and we do not have an aircraft carrier there, did you know that? The aircraft carrier that is in Japan is now in the Persian Gulf and that aircraft carrier that is in the Persian Gulf was supposed to be in the junkyard next month, to be cut up.

    Now, I do not think I would like to be the CINC, sitting in South Korea with air bases there and not have any support from the outside, even though they could do it in Japan. Now, the reason I bring it up, since the question was asked, can we fight two major conflicts, you gentlemen talk to a lot of military people who will level with you. You are out of the Administration now and all the time, people do not level with us and particularly in public.
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    Judge Webster last year stated in his talks with senior military people that they think we have enough now. In your conversations, do they say the same thing or do they have other concerns and I am not talking about mentioning names?

    Mr. DEUTCH. Well, I must say, Mr. Sisisky, I do talk to senior military leaders all the time, both active duty and recently retired individuals whom I was fortunate enough to work with during my 3 years in the Department of Defense. I would say that they are concerned about the op tempo at our deployments around the world, and that is especially true for certain elements of the Air Force. It is certainly true for elements of the Marine Corps and of the Navy.

    But, in general, compared to 3 years ago, I think any candid assessment of the threat, changing the threat, and any candid assessment of our improvement readiness makes us better able to handle this most distressing two regional conflict scenario. So, I would guess that I would actually get better reactions from the military than when I first went to the Department of Defense, not in 1961, but in 1993. In the short run, the concerns that I have are a little bit farther out and have to do with procurement accounts. But, I believe that General Tillieli, who is our CINC in Korea, one of our most outstanding individuals that I had the pleasure of working with, is having a similar judgment.

    We could not enter into two regional conflicts and maintain the deployments that we have, for example, in Bosnia. Obviously, that would have to—even for one regional conflict, we would have to pull back from all of those lesser conflict situations where we are at peacekeeping operations where we are at, if we were in a regional conflict.
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    Finally, let me say, it is not a bright line. You do not have to, if you are stressed in a limiting case, the most difficult case, where you are actually involved in a two-front war, you do not have to have equal campaign plans. You have to stop the enemy, but you do not have to have equal campaign plans for moving to victory. That does not have to happen on the same time scale, which we saw in the Second World War, when we were fighting both in the Pacific and in Europe.

    So, in the short run, I think military opinion, high ranking military opinion, is relatively comfortable and more comfortable than they were 3 years ago because of the lower nature of the threat, quite frankly.

    Mr. WOOLSEY. I can say briefly that I think while people are proud of their forces and the residual forces that are left from earlier build ups and morale and the like, I hear a number of people saying the equivalent of, we are eating our seed corn.

    The acquisition budget, R&D, procurement, is thin, looking out into the future and the way the calculations are done. Sometimes they are somewhat optimistic, and so in reality, it may be even thinner than the worried people are now saying. So, I think that, you know, one of the great heroes of World War II is the gentleman whose portrait is right above Mr. Bateman, because he led this committee to support the two-ocean Navy during the Depression. I think it was right after the Battle of Midway, with repairs and sinkings, we had one carrier left in the Pacific operational, Enterprise. So, it got very thin.

    Now, because of what he and Franklin Roosevelt did, they started coming off the waves awfully quickly and the war in the Pacific went the way it did, but I think in this era, which in some ways today has some similarities not to the 1930's but to the 1920's, in which we are the dominant nation in the world, we have just won a world war—cold one, instead of World War I. The stockmarket is booming, all of that, people tend to get rather relaxed and full of themselves and self-satisfied. And, in circumstances like that, it is very important for Carl Vinsons to start—whoever they are today—to start waking people up, I think.
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    Mr. SISISKY. I hope 50 years from now that they will be talking about you, Mr. Spence and Mr. Chairman, as being the hero of getting enough ships on the seas.

    The CHAIRMAN. Well, we will try with your help.

    Mr. Saxton?

    Mr. SAXTON. Thank you, Mr. Chairman. Gentlemen, thank you for being with us today. You have both mentioned the difficulty in dealing with Saddam, particularly with regard to the weapons of mass destruction and I guess my question goes to bolster your suggestion that this is more than a difficulty. One of the things that you have not mentioned yet is the cooperation that Saddam has received from some of the region, particularly from Sudan and from Libya. We have done some research and it appears that particularly in Sudan, the strategic cooperation which exists between leaders in Sudan and Saddam is quite extensive and dates back to the beginning of the 1990's as a result of activities that we all know about in 1990 and 1991.

    In March, for example, of 1991, Terik Aziz apparently requested permission from the Sudan's president to move Iraqi chemical weapons to Sudan, in order to circumvent inspections by the United Nations. Iraq also transferred, in the summer of 1991, some nuclear material to Sudan. With U.N. inspections continuing, Baghdad committed itself to bolstering the regime in Sudan which had, by the fall of 1993, we believe, become a very strategic and important storage site for chemical and biological weapons. Then, by 1995, secret contacts between Iraq and Iran culminated in a visit to the Sudan by the social affairs minister, and I cannot pronounce his name, so I will not try, in order to implement an agreement.
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    The agreement that resulted from those contacts, the embassy, the Iraqi Embassy, was increased significantly. That is, the personnel there was increased significantly. Meanwhile, teams of Iraqi intelligence and military commando officers arrived in Sudan in the summer of 1995 to assist the Sudanese armed forces while the Iraqis continued to ship more munitions of undesirable nature to that country.

    Then, the Iraqi expeditionary units apparently had a very simple task and that was to supervise and maintain the Iraqi strategic weapons and military equipment stored in Sudan and to keep it away from U.N. inspection teams.

    I can go on. It goes on up to 1996 and 1997 in a continuing pattern, and I can also build the same kind of a case with regard to Libya. Now, the question I guess I have is two-fold. First, do you agree with conclusions that I draw, that I am able to draw from this information, that this is a major departure from what we generally have talked about here and believe to be true? Second, does this not make it highly unlikely that we will have even short term success from air strikes?

    Mr. WOOLSEY. Congressman, I will just say a quick word about this, because most of this is new to me. At the time I left being director in January of 1995, our main understanding of Sudan's foreign ties and support, as I recall, were with Iran and there was considerable assistance to Sudanese facilities for supporting and training of terrorists and the like.

    But, what you say is not at all surprising and it would be logical that Saddam would seek places outside Iraq to hide various, either weapons of mass destruction or the wherewithal to produce them. So, although this is new to me, it has certainly the ring of plausibility. But, I cannot help you with whether or not it is, in fact, the case. Perhaps Mr. Deutch has been in DC more recently than I. Perhaps he can.
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    Mr. DEUTCH. Mr. Saxton, I cannot add anything to Jim's answer on this. I would say that this is the kind of question which ex-DCI's are much less qualified to answer than current DCI's. I would urge you to ask George Tenet about it and I am sure you will get a full and accurate answer.

    The CHAIRMAN. Mr. Pickett?

    Mr. PICKETT. Thank you, Mr. Chairman. I welcome our witnesses this morning. Gentlemen, lots of times we hear that there may be two or more components to national security. We talk about threats to national security perhaps as a military security and also economic security. And, you have already mentioned the dependency of the United States upon Mideast oil and I assume that is intended to be an economic threat to our nation's security and how that is rated, strong or weak, is a matter of judgment.

    My question is, are there other economic threats to our security that you see, and secondly, is our nation doing enough to deal with its dependency upon the Mideast oil and to try to defend against that threat, so two parts?

    Mr. WOOLSEY. Let me say a quick word about that. Today, most of our imports and over half of our oil is now imported. It's not directly to come from the Mideast, but usually from the Western Hemisphere. But, the United States has only 2 percent of the world's proven reserves, and the Mideast has close three-quarters.

    So, it is the world's dependence over the long run on the Mideast, rather than American dependence today for shipments, it seems to me, to be at issue. I must say I think, because of the volatility of the region, because of the huge share of overseas payments which we must devote to imported oil and for a range of other reasons, dependence on this very volatile part of the world for the world as a whole is a serious problem. About half of the United States trade deficit is oil imports and if Asia's banking problems and crises either continue or worsen, the depreciation of a number of currencies in Asia is going to mean, and the economic chaos they find themselves in, is going to mean that they're going to try to export themselves out of their economic difficulties.
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    When they look to do that, they look to the world's largest and most open market, namely, us. So, one of the things that is going to happen here over the course of the next few years, I think, is that there will be more and more products coming from Asia, seeking to be purchased by American citizens. That, in turn, means that we export more and more dollars and essentially ask the world to hold them.

    Right now, the dollar looks rather sound, to put it mildly, but there is a rival reserve currency potentially coming about next year, the EMU, and certainly the Europeans have the hope that it will become a rival to the dollar as a reserve currency in the world. Every 2 or 3 years, a Japanese prime minister or someone senior in the Japanese government gets a bit nervous about the amount of dollars they are holding and makes a speech, and the stockmarket goes down a bit.

    If you put all these things together, I would suggest that over the next number of years, it would be a far sounder policy for the United States, in view of the need to absorb added imports from Asia, in view of the position of the dollar today as the world's only reserve currency, but one that we ask more and more people to hold more and more of, in order, essentially, to loan us money, in view of all those circumstances, it would be quite prudent for us to see what we could do to begin to replace imported oil with domestically produced transportation fuels of some sort.

    So, I see that whole concatenation of circumstances as a serious economic issue for us over the long run, and imported oil is an important part of it, but it's not the only part.
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    Mr. DEUTCH. Mr. Pickett, let me say that 20 years ago, another former director of Central Intelligence, Jim Schlesinger was Secretary of Energy and at that time, I was his Undersecretary and we were very conscious 20 years ago of the long term national security threat to this country from this compelling dependence and growing dependence on Middle Eastern oil of which Jim speaks so correctly and so eloquently about.

    I believe that in the short run, we are being lulled by the availability of oil around the world at its relatively low price and that in the long run, not only the United States, but more importantly, the world community and our closest allies, are running into tremendous danger for the reasons that Jim said, because of our dependence on oil, most of which finds itself in the Middle East or in other very, very delicate areas like the Caspian Sea, which is an important potential source of oil.

    So, getting away from oil is a long term economic strategic national security matter, and I do not know how to draw a line here between the economic and the national security interests. People who say that natural gas will take all this up, I think, are very optimistic indeed.

    But, to answer your question in a different direction, I do think that it is a very important question for this committee to dwell on and to think about, the other long term pressures which are partially economic in character, whether it has to do with world food, whether it has to do with the availability of water, whether it has to do with issues of drugs, which mix economic and criminal activity together, to understand the kinds of threats this country will face.
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    I would point to the ethnic rivalries which are going on around the world, to agriculture and food, to water and to drugs as being other important sort of subjects which will have a tremendous impact on the welfare of this country whether you care to term that economic or national security. It is a fuzzy area, but they are important.

    Mr. PICKETT. Thank you very much. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you, Mr. Pickett.

    Ms. Fowler.

    Ms. FOWLER. Thank you, Mr. Chairman, and welcome to both of you here today. This has been a very interesting meeting and I do have a couple of concerns that have not been covered yet—several of mine have—that I would like to have you address, please.

    One is Egypt. At the beginning of this decade, the government of Egypt was really having acute problems with Islamic military movements and terrorism and they got control for awhile, but now there has been a renewal of some of these terrorist incidents.

    I remain very concerned about the situation in Egypt, which had become one of our most important friends, really, in the region. Could either of you comment on the situation there today, what you see for the future and also, in looking at the long term, what you think the popular reaction in Egypt is going to be should we begin engaging in military action in Iraq?

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    My other concern is based really on internal things of the CIA. Dr. Deutch, back when you were director, you had inaugurated some new policies that were aimed at limiting the use of foreign nationals that had, I guess, unsavory backgrounds and sources for intelligence. These, I know, were driven by concerns we all share, paying people who have been involved in human rights abuses or in other activities, but some have noted that people who go to garden parties are not sometimes the best resources for terrorist activities.

    Since this now has been in place, could you comment on what you see about these policies, are they serving our interest? Are we still getting the kind of access we need to do a timely and useful intelligence, or do we need to change it somewhat? I would appreciate both of you commenting on that too.

    Mr. DEUTCH. Ms. Fowler, let me take each of those in order. The first is, I think your bringing up Egypt is an extremely astute and important subject. I am personally quite concerned about Egypt, despite the fact that President Mubarak remains very firmly in control now, even in consideration of the increased terrorist activity.

    The social and economic conditions in Egypt are not good and they are not improving, so that country every year, it seems to me, is somewhat under greater stress internally and that seems to me to bode very poorly for security of the region. So, the situation in Egypt, given the level of economic stress on the population and the social stresses there, is one which certainly deserves attention and I am not sanguineying about it at all.

    President Mubarak does take a leadership role in the Arab world. The population of Egypt, I think, if you look at the sort of public commentary in newspapers and the like, is very much pro-Arab, growing since the time of Sadat, growing against the peace process and against good relations with Israel. Indeed, there is a tremendous amount of popular sympathy in the newspapers and in the media for Saddam Hussein in Egypt. I think that's one of the places where Saddam would, so to speak, pick up popularity among the population if there were air strikes. But, Egypt is a country to be concerned about.
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    Let me just take a moment, although it is somewhat old for me to make some remarks about the CIA, I think the way that you posed what was our effort at the time, certainly my effort at the time is not exactly accurate. Obviously, if you are dealing with human intelligence and obtaining information from agents, you are not dealing with Thomas Jefferson-type people, or even people from Massachusetts, I might say.

    So, there is no question about the fact that you have to deal with that. My concern was putting into clear rules about making a judgment about when some arrangement was underway, in order to protect the young case officer in the field from having questions raised later about their decision to make an arrangement with a source. Unfortunately, like so many things that I have tried to do in government service, it did not work quite as it would in a perfect ballet, and certainly outside the agency and perhaps even in the agency, that effort to ask for more scrupulous reporting about the way arrangements were made with prospective agents was looked at as a way of trying to stifle dealing with bad people, rather than what our intent was, certainly my intent and the intent of my staff, including my deputy, which was to assure that the case officer was protected when that judgment was made by the fact that it was reported and looked at. There are, of course, certain legal rules that you cannot make an arrangement with somebody who was known to have committed a crime against an American without the director taking some action on it.

    So, I believe that this was, we certainly made a tremendous effort to communicate this and I am absolutely sure that the current great director of Central Intelligence, George Tenet, is making progress on this to repair any imperfections that may have occurred while I was director. But, it is a very good question, very important as human intelligence collection is more important today than it has been in the past. I know Jim Woolsey and other prior directors worked very hard to strengthen the human intelligence capability and I am quite confident the current director, George Tenet, is going to do an excellent and is doing an excellent job on keeping our capability for collecting human intelligence more important today than ever before in the best possible shape of the country.
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    Ms. FOWLER. Thank you.

    Mr. WOOLSEY. Congresswoman, let me say first about Egypt, the renewal of terror, I think, was a most unhappy—but not a surprise to most people who have followed Egypt over the years.

    The terrorist organizations throughout the Mideast in many ways had their genesis in Egyptian groups of the 1940's and slightly later, and it is a continual running sore in Egypt. It is made worse and indeed, is fed, by corruption and economic stagnation. Egypt has some positive aspects to its economy, but it is generally not a prosperous place and it is not seeing the growth of a middle class and so forth, that one would want.

    I think Egypt continues to be in a troubled condition, but I would not say a crisis, but I think you are exactly right to focus on it as, in many ways, if not the most important, one of the two or three most important nations of the Middle East for all sorts of reasons and we need to work very hard to try to keep our relations with the Egyptian government such that we can have some leverage on them to battle corruption and especially which feeds the anger at the state as one part of what is going on.

    With respect to the CIA guidelines, I do not want to comment about the guidelines themselves, but let me say what I think the relevant parameters are. First of all, if one is going to conduct covert action under a finding submitted to the President, a CIA case officer overseas needs to be particularly careful whom he recruits and uses for that action. To use only one example, you do not want to overthrow a government of thugs with a worse group of thugs. You may well not want to smuggle weapons to someone using murderers, because the murderers may take them and kill people with them and so on.
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    There are legitimate, ethical tests, in a sense, to people whom the United States uses as its agent in the traditional legal sense of the word, taking action for the United States, an agent that a case officer recruits to conduct a covert action.

    Now, when we recruit spies inside governments, there are a reasonably large number of people, and this was certainly true in the old Soviet Union and it is true around the world today, for whom the United States is a beacon of democracy and idealism and there are a number of people who work for the United States as spies, foreign individuals who do it out of a sense of idealism.

    Colonel Penkovsky, recently in a book called ''The Spy Who Saved the World'' for his role in the Cuban missile crisis is one example. A wonderful man, Colonel Kuklinski, a Pole who spied for the United States for 10 years and gave us the Warsaw Pact war plans year after year, who lives here in the United States now. Many of these people—I do not know that I would say a majority, but a fair number of people who were trapped in governments that they hated, whether it is North Korean or Soviet or whatever, saw the United States and see it still as a beacon of freedom in the world, work for the United States out of a sense of idealism. Some of these people will take money sometimes. Many of them do not even take money.

    But, when one is trying to penetrate with espionage a terrorist group, let us say, if one does not know enough about what Hezbollah is doing, the problem is not that we have too many people with bad human rights backgrounds as spies, it is that we do not have enough. Because, there is nobody in Hezbollah unless he wants to be a human rights violator.

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    By the same token, the Attorney General cannot successfully penetrate and prosecute the Mafia if the U.S. attorneys and the FBI are told, do not make deals with crooks, because that is the way you penetrate the Mafia. That is the way you get convictions. Your or my next door neighbor today may be Sammy The Bull Gravano, living under an assumed name. He was a hit man for John Gotti. Confessed to 19 murders, probably committed more. Walked as a result of his testimony against Gotti and I think the Justice Department made the right decision. They got John Gotti convicted and they did it by doing a favor for a murderer of 19 people, a big favor, giving him his freedom.

    So, whether one is dealing with law enforcement or with espionage, there are circumstances, particularly when operating against criminal groups and terrorist groups and the like, in which one absolutely must use informants who are not only a little bit unsavory, but absolutely awful people. We do have rules. The terrorist statutes mean that if someone has been involved in an action, a crime, particularly a murder against an American citizen, that needs to be reported to the Justice Department. There are important steps like that.

    But, I think it is important to sort of parse out the circumstances and what one is using an informant or a spy for. I think your question was a very good one.

    Ms. FOWLER. Thank you. Thank you, Mr. Chairman.

    The CHAIRMAN. Mr. Snyder.

    Mr. SNYDER. Thank you, Mr. Chairman. I want to ask a couple of questions, if I could, about the cooperative threat reduction program. Dr. Deutch, you made a comment in your statement that you considered the funding to be of continuing importance. Mr. Thornberry was active in the last year to keep those funds from having some provisions on them, he and Mr. Spratt and some others, and it was a very close vote in the House. I think some folks see that it might be mistaken as foreign aid, that somehow was something that you could hold hostage to bad behaviors on the part of governments and specifically, this particular one was trying to link those monies to some Russian help to Iran.
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    I think that it is ironic that I ran into a scientist the other day who, a former scientist, now in the diplomatic corps for a newly independent country. He was very, we were talking about this issue and I think he is bored being a diplomat, but a lot of his colleagues that formerly worked in Russia are now working in Iran, because they could not find a place to work.

    Do you have any comments, Dr. Deutch, about the cooperative threat reduction program and this possible linkage in holding those kinds of things hostage in the future?

    Mr. DEUTCH. Well, I do have comments about it. If you are looking for a nuclear weapon today in the world, today, strategic nuclear material, the single place you are most likely to find it is through a leaky Russian laboratory or in some part of the weapons complex.

    So, the efforts to reduce the number of Russian nuclear weapons, to dismantle them, to have the strategic nuclear materials stored under safer conditions, to improve materials accountability throughout the whole Russian complex, is absolutely in the United States national security interest and I regard it as being appropriate—I can say this now as a former government official—it is appropriate to put in the defense budget and I think it should be run largely by the Defense Department and also by the Department of Energy. I do not think it is foreign assistance. I think it goes to the core of what my former boss, Bill Perry, called preventive defense. It is very much in our interest.

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    It should be bipartisan and the more people care about defense, the more they should be voting for this program, and I think arguments that you can solve or should wait until all problems in Russia are solved before you do it are very short sighted indeed. I do not say the Russians are not doing things with the Iranians—I mean, they are doing bad things with the Iranians. But, it is in our interests to reduce the missile sites, to help them destroy their long range missiles, to buy highly enriched uranium from them, to improve materials accountability at their very leaky weapons complex.

    I noticed the other day, incidentally, that at the Smoletz Nuclear Power Station, there was a strike of workers. The nuclear power station, now, fortunately, that's not a nuclear stockpile. At the nuclear power station, there was a strike of workers. They have not been paid in nine months. That situation has to be remedied for our own national security interest.

    So, I believe that both sides of this aisle ought to strongly support this program. It is very modest, indeed, and it should be, as fast as possible, it should be run by the Department of Defense. It is not a foreign aid program. I hope, I am trying to be as clear as I can.

    Mr. SNYDER. Yes, I appreciate it.

    Mr. Woolsey, in your statement, I do not see a specific reference to the cooperative threat reduction program, but you do mention this problem with scientists looking for work. Do you have any comments on the program?

    Mr. WOOLSEY. No, I think it is important to support the program and I think it is important for us to be clear and blunt with the Russians when these firms undertake actions abroad in Iran or Iraq or anyplace else.
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    But, it does seem to me that Nunn-Lugar and those types of programs ought to have bipartisan support and that they are extremely useful.

    Mr. SNYDER. I also wanted to ask you, Mr. Woolsey, you, in your statement, talk about the need for negotiated agreements with Russia to reduce as you phrased them, the likelihood of tragedies or accidents?

    Mr. WOOLSEY. Yes.

    Mr. SNYDER. Would you amplify on that a little bit, specifically what area?

    Mr. WOOLSEY. Well, I think that there are no imaginable circumstances in which we should remove warheads from our ballistic missile submarines or otherwise hinder their ability to patrol at sea as a deterrent to nuclear war.

    But, I would say that given this delicate situation with Russian command and control, gaps in their early warning, uncertainty about the pay for the strategic rocket forces, the elements that I mentioned, I think there could be some utility in discussions with the Russians about changing the structure of alert status for land based missiles.

    Now, the Russians might not want to bite on that, because they are having trouble keeping their ballistic missile boats at sea for reasons of maintenance and cost and the like, but nonetheless, although the chances of an inadvertent Russian nuclear launch in response to a Norwegian sounding rocket or anything else are very small, the consequences would be so devastating that I think we should at least begin to explore with Russia how we might in some type of exchange of information of agreed inspections in some fashion, see if we can persuade them, through some actions that we would also be willing to take, to put more barriers between the decision in a hectic circumstance to launch a nuclear weapon and the actual occurrence on the Russian side.
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    I also think that a national ballistic missile defense for the United States, at least one that is capable of dealing with a relatively small number of weapons launched in an inadvertent or accidental or unauthorized launch, is an important priority. I think those two things go hand in glove.

    Mr. SNYDER. Thank you, gentlemen. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you.

    Mr. Thornberry.

    Mr. THORNBERRY. Thank you, Mr. Chairman, and let me express my appreciation to both of you for the statements that you have made. Like, I think, all of us, it is important for this committee to have a perspective of the shape of the forest, not just the tree that's the biggest one in front of us. Sometimes that is difficult to do. You all have both helped us do that today.

    Let me also say, I appreciate the comments that you have made on the cooperative threat reduction efforts, because it is kind of amazing to me that it is as controversial as it is. Regardless of what other things the Russians are going on, it seems to me that it is in our best interest.

    Let me just throw out two things that I would appreciate your comments on regarding the current situation in Iraq. No. 1, is the relationship between Iraq and Iran now, how does that influence things? How is that going to change over time?
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    Number 2, what are the chances that if we launch air strikes next week or the week thereafter, that Saddam Hussein would actually attempt to use some of the chemical or biological weapons he has available on a SCUD or something else? What are the dangers that our forces or our allies in the region may face with those kinds of weapons, if we go ahead with an attack as we are talking about?

    Mr. WOOLSEY. The relationship between Iran and Iraq is a strange one. It is hostile and has been so off and on for many, many years, going back into ancient times. Today, I think Iran's posture is that it does not want to look as if it is standing aside from the Arab nations of the Mideast in anyway encouraging the United States to take action against Iraq.

    But, this is almost an ideal situation for Iran, because its two principal enemies, Iraq and the United States, are at odds with one another.

    I think that Iran will probably, for the foreseeable future, try to do tactically in the short run anything it can to weaken either Iraq or the United States, and if possible, both. Therefore, you may see some odd tactical moves, such as Iranian assistance or cooperation with the Iraqis under some circumstances, or standing off from them if they feel that the Iraqis are gaining an upper hand.

    I think if we launch strikes, Saddam would be very ill-advised to use a SCUD or aircraft delivered weapons of mass destruction anywhere in the Mideast. I am afraid that I think his cleverest move would be terrorism. Now, the Iraqi terror network was rolled up very effectively by the U.S. Government, principally by the CIA, in 1990, 1991 and we were very worried at the time about Iraqi terrorism. I was the beneficiary of this rolling up, to some extent, because I was an ambassador negotiating an arms control treaty based in Vienna during that gulf war and there was a great deal of security and we found out later how effective it had been and a good part of what had happened had been that the United States went out to governments all over the world and said, we are dead serious. We want anybody who remotely might be an Iraqi terrorist taken care of and jailed or kicked out of the country or something.
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    Many, many countries cooperated. But, that does not mean that Iraqi intelligence is dead forever and it does not mean that it cannot, through intermediaries or otherwise, sponsor terrorism. It is easier for it to do so in the Mideast. It does not have the worldwide reach, at least I do not believe yet, that Iranian terror, operating through Hezbollah and others, does. But, it is not dead and I am afraid that the cleverest move by Saddam in the event of a war would probably be terrorist actions against either U.S. forces in the region or even against someplace here in the United States, and to do it with a hidden hand, making it look as though it were Iranians or Sudanese or someone.

    Mr. DEUTCH. May I just make a remark about Iran-Iraqi relations. I think they have historically been lousy and there is every indication to believe that they will be lousy for a long time to come. We do have the recent examples of Iranian help to the Iraqi Shia minority population in the south in 1992. We have an even more recent example of significant Iraqi assistance to the PUK Kurdish groups in the north, at the same time that there was activity between Saddam Hussein and the other Kurdish faction.

    So, there is plenty of evidence that Iran is not going to be tremendously friendly towards Iraq, and indeed, that is one reason why I think it bodes to our interests to try and interact with Iran in the near term, provided they give up their considerable sponsorship of terrorism around the world.

    With respect to the use of chemical and biological agents, I think that cannot be ruled out. It is something that has to be planned for, both with our forces in the region, planned for with our allies, which are even more vulnerable than we are, and planned for at a greater distance, but I did, I do take some note of the fact that in the gulf war, the statements made at that time by Secretary Chaney, by the President and by others made it clear to Saddam Hussein that if there was any use of weapons of mass destruction, that he would be toast and there would be no end to what the United States would be willing to do to overthrow him.
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    So, I think that he is enough of a rational person—enough of a calculating person, I should say, if not a rational person—to understand that were he to use it, that the vengeance would be complete and swift and thorough.

    The CHAIRMAN. Mr. Taylor.

    Mr. TAYLOR. Thank you, gentlemen, for sticking around as long as you have and welcome back, Mr. Deutch.

    Mr. DEUTCH. Thank you, sir.

    Mr. TAYLOR. It was awesome to see seven T's flying over Charleston the other day, and you were right on that one, so I congratulate you.

    Two things I would like you to respond to, and Mr. Woolsey, I did read your remarks about the thought of targeting Hussein himself, but we are the rule of law. That is what this country is all about and I realize there is an Executive Order that bars foreign assassinations.

    But, if Congress were to take the step of a vote of both houses, telling Saddam Hussein that he will be personally liable for the violation of any U.N. sanctions and that he would personally suffer the consequences, we are given the power in Article and Section of the Constitution to declare war. What would be the reaction of putting him on the spot under such legitimate circumstances? That would be my first question to both of you.
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    The second one is, I am curious what your thoughts are on should the United States mission in Bosnia shift from the present peacekeeping to the possible rounding up of war criminals? No. 1, should we do it and No. 2, if you think we should do it, what do you think the reaction would be there?

    Mr. WOOLSEY. Let me take the first one, if I could, Congressman Taylor. Certainly, if Congress acted by law to essentially repeal the Executive Order 12333 and had it been legal for the Executive Branch to conduct assassinations in the same way that it was not illegal back in the 1950's and 1960's, during the time when the CIA so ineffectively tried to assassinate Castro, for example. But, if Congress acted to repeal the Executive Order, then my objection on the grounds of illegality, of course, would be gone.

    I still think in terms of trying to find Saddam and this is something even Mr. Stephanopoulos admits in his article in Newsweek, it would be almost impossible. He has doubles, he changes where he stays and so forth, so an actual assassination attempt, I think, would not succeed.

    I think on policy grounds, this is something that the United States really ought to do only in the event of something as serious as World War II. If you take the hypothetical, should the OSS, if it had known about it, been willing to cooperate with Count Von Stauffenberg and the other plotters to assassinate Hitler in 1944, I would say yes. That was a war to the death between a totalitarian power that had conquered Europe and the United States and its allies, and that, to me, is a different circumstance than what we have today.

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    I would also add that under the Justice Department's interpretation of 12333 and the aftermath of the Libyan raid, the raid on Tripoli that was launched in the Reagan administration, it is not illegal, as I understand it, to bomb a number of commanding control centers and if one happens to kill senior people in the government, including the national leader, that does not come under the prohibition against assassination in 12333.

    But, I think if one is talking not a military raid but a classic case of using assassins, in the sense that Mr. Stephanopoulos argued for, an inside job, I do not think that should be done and accepted.

    Mr. TAYLOR. I do not particularly want to use the word assassination, because I think if you put someone on notice ahead of time that these are the rules, you are going to abide by the rules or then a state of war will exist between you, the person who has broken the rules and those who seek to enforce them. I see that a whole lot differently than an assassination attempt that is done covertly.

    Mr. WOOLSEY. Well, to be successful, assassinations tend to need to be covert and putting him on notice, in a sense, makes it clear what the U.S. Government policy is and to my mind, the effect that has is that it repeals the Executive Order and makes it legal to——

    Mr. TAYLOR. There is a rule of law, that is an Executive Order, No. 1. No. 2, you both pointed out very clearly that you are talking about someone who is a thug.

    Mr. WOOLSEY. The worst.
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    Mr. TAYLOR. Fine. Who does not care if his people are hurt. I do think he cares about himself.

    Mr. WOOLSEY. Yes.

    Mr. TAYLOR. I think we have been targeting the wrong people.

    Mr. WOOLSEY. Well, I have no objection and certainly, the Justice Department's interpretation of the Executive Order removes any doubt that it is quite legal under American law today, in a military action, to try to bomb facilities where he might be located.

    In World War II, we were able to kill Admiral Yamamoto in an action of exactly that sort. We broke the Japanese code, we knew what airplane he was on. We sent some P–38's up and shot it down, and that was a military action in wartime against a hostile aircraft. A military action against the Iraqi capital in which facilities were bombed where Saddam might be present is legal today, as I understand it, under the Executive Order as interpreted by the Justice Department.

    Mr. DEUTCH. Mr. Taylor, let me make two remarks. First of all, I think your distinction is a completely appropriate one and indeed, I think it has a certain allure. To say to Saddam Hussein, declare it publicly as a matter of U.S. policy that he will personally be held accountable if this situation continues or worse, if he takes certain hostile actions, I believe, is completely appropriate and I think it is absolutely right to say that he will be held personally accountable in the overt ways that are used by both our military forces and our law enforcement agencies. So, I think that has a certain recommendation that recommends itself in my mind.
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    What I think is not to be done here and it is bad for U.S. policy and I would join Jim Woolsey in worrying about it is to say that we have a policy in this country of using the CIA to covertly—I know when addressing your comments, I believe the current Executive Order is proper in this regard and should not be, just to make it clear, changed for the sake of Saddam Hussein.

    Let me say a word about your second question which was about Bosnia. I might have a slightly—I think the right word is conservative view. I think that Mr. Sisisky struck a responsive chord with me, while we are there, having had a long record now in Bosnia, maintaining the peace and trying to bring that country together, where are our European allies? It is really in their neighborhood, not in ours.

    So, my criteria for Bosnia and I think you should always start with how do you get out. I think that is always the question in military force deployments, how do you get out, I take a very conservative view. You stop the killing, you try and put in some stable governments which will manage the area and then you get out. The notion that we are going to be committed there as a country, to go through all the terribly complicated and demanding and I hope successful, eventually, building of democratic institutions, including the rule of law, is really something more than I think U.S. military forces should be doing there.

    So, my view with Bosnia is, we have done a tremendous job. Our military forces there are absolutely extraordinary in what has been accomplished with almost no loss of U.S. lives. It has cost the U.S. taxpayer a great deal of money. The issue is when to get out and from that point of view, in order to get an answer to get out, it means that you have to have a narrower mission rather than a broader mission.
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    I hope the Europeans and the people in the area can work together to make it happen, but I am concerned that I do not see clearly when we are getting out and when the Europeans are going to step up to take up the slack.

    The CHAIRMAN. Mr. Hostettler.

    Mr. HOSTETTLER. Thank you, Mr. Chairman. As Mr. Taylor said, I want to thank you gentlemen for spending such a long time with us this morning.

    Mr. Woolsey, in your opening statement, you have an interesting perspective on the developments in the Persian Gulf with regard to the Saudis allowing us to launch attacks from bases in that area. I think it is very plausible reasoning, as well, because they feel that we do not have the resolve or the capability to get rid of that angry viper, as you say, and they will have to put up with him for the time being, until that time comes.

    So, this brings me to a point that has been made several times in this committee with several witnesses, and that is the idea of fighting in coalition forces. I think it is not coincidental that during that time the decision was made that we could not make air strikes from Saudi bases, that we decided to take an aircraft carrier, as Mr. Sisisky points out, that was going to the scrap yard and decide to put it in the hottest military region on the face of the earth and have it possibly and probably go to time of conflict.

    Is it something that you, and you both can answer this, but is this dependence on building coalition forces and to the extent that we may have one of the telegraphed first punch in the history of war, that we have to build these coalitions, gruelingly so, and have to go on television to make our case from time to time, so that we do lose that opportunity to make that surprise attack.
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    Are we capable of going alone, should we go it alone and isn't this just one more example of the fact that we cannot always depend on coalition forces for vital national interests?

    Mr. WOOLSEY. I think part of the problem, Congressman Hostettler, is that we let the coalition more or less deteriorate over time, after 1991. I think it was Mark Twain who once said that the United States has never lost a war nor won a peace conference. That is not entirely true. We have now lost one war and we have won some peace conferences, but the jibe adds something to it.

    We won the gulf war and then, by not protecting the Shia in the south, by not establishing a no fly zone over the whole country right away and then by being, I think, as I said, rather lax with respect to our retaliation against Saddam for some terrible provocations, including an attempt to assassinate the former President of the United States, over the course of the last 5, 6 years, spanning two administrations, I think we have let the coalition more or less deteriorate. Now that we really need it, we have had to go to some substantial lengths to try to rebuild it and we have only rebuilt it in part.

    It strikes me as former Undersecretary of the Navy, I must say that I do not think we have lost an aircraft carrier since the Battle of Midway, and we have lost an awful lot of bases on land to changes in government and the whims of various governments. So, we were very, very lucky that people in the past had the foresight to have a carrier fleet, otherwise, we would be in very bad shape in the gulf today. To a limited extent, in some circumstances, at least as far as military power itself is concerned, carriers can replace coalition bases. We would be in much better shape if we could operate the larger Air Force aircraft out of the Saudi bases, but the carriers provide a lot.
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    But, carriers cannot provide political support. They cannot do what we would have been able to have done with a coalition that had been held together over the years since 1991, because we were being really tough with Saddam and so we put ourselves over the course of the last 6, 7 years, I think, into a very difficult situation, and we are climbing back uphill now to try to put the coalition together and have the wherewithal to execute really effective military strikes.

    Mr. HOSTETTLER. But, those decisions have already been made and whether we made those decisions based on what we wanted to do as far as political outcome in that region or, in effect, to affect a military end, we made those decisions.

    Mr. WOOLSEY. Yes.

    Mr. HOSTETTLER. And, we have to live with those and as you say, it spans two Administrations so we are not necessarily placing a partisan fault, but we made those decisions and now we have to live with them.

    Is not, in fact, the role of the military and our commitment to national defense to make sure that if we do make those faux pas, that we have a military capability to back up our vital national interests?

    Mr. WOOLSEY. Yes, I think that is absolutely right.

    Mr. HOSTETTLER. Thank you very much. Thank you, Mr. Chairman.
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    The CHAIRMAN. Mr. Abercrombie.

    Mr. SKELTON. Would the gentleman yield for just a moment?

    Mr. ABERCROMBIE. Certainly.

    Mr. SKELTON. I hate to correct the witness, but I think in the battle of the Philippine Sea——

    Mr. WOOLSEY. Philippine Sea—were they jeep carriers or fuel carriers?

    Mr. SKELTON. They were aircraft carriers. Aircraft landed on them and they took off.

    Mr. WOOLSEY. All right, I accept the correct, Mr. Skelton, but I do believe they were probably jeep carriers which are not really full aircraft carriers. But, nonetheless, it is a sound point.

    Mr. ABERCROMBIE. Thank you very much. Dr. Deutch, aloha to you. Pleasure to see you again. Mr. Woolsey, aloha.

    Dr. Deutch and Mr. Chairman, I apologize, I had to leave for a brief time and I hope I am not repeating a question and please let me know if I am. Dr. Deutch, on page two of your testimony, it says, ''It is unclear whether in the long run the direction of United States-China relations will evolve toward strategic competition * * *'' that is an interesting phrase we might explore, ''* * * or relationships such as we have with a democracy. Accordingly, it is of paramount importance for the United States to maintain a strong presence in the Pacific region and strong alliance relationships, most particularly with Japan.''
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    Dr. Deutch, and Mr. Woolsey, if you would care to answer, as well, I have been, and I am sure the chairman would agree, among the strongest opponents on this committee and I believe in the Congress against what is commonly called transfer of technology.

    In the light of the statement that you made, Dr. Deutch, do you have something you could share with us in open session here in terms of a view, an opinion, a perspective with respect to the transfer of technology and how that might imperil the national security interests of this nation?

    Mr. DEUTCH. At this late hour, you are raising a huge question.

    Mr. ABERCROMBIE. That is my job. That is what the Chairman told me, I am the big question guy.

    Mr. DEUTCH. Let me try and respond.

    Mr. ABERCROMBIE. Before you do, Dr. Deutch, obviously I do not expect you to be done in 5 minutes. Mr. Chairman, perhaps if either gentleman would care to expand beyond brief remarks now, I think it would be very valuable to the committee.

    Mr. DEUTCH. First of all, let me say that there are three categories I assume you are referring to. One is military technology, the second is commercial technology and the third is the most difficult category of dual use technology, which is becoming more and more prevalent, especially information technology.
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    I also want to restrict my remarks to China, although maybe make it broader.

    Mr. ABERCROMBIE. Yes.

    Mr. DEUTCH. With respect to commercial technology, I believe that there is no reason to have anything but the greatest happiness with this taking place, for several reasons. One is, it has been extremely good for U.S. business and secondly, were we not to do it, certainly other nations would be doing it and the commercial advantage of doing trade with China, for example, in aircraft, telephones and the like would go to someone else.

    I think it is not possible to stop the flow to commercial technology as it becomes part of the open trading system between countries and I would not suggest doing so with respect to China.

    Second, military technology. Here, I would first of all note that China is becoming the best customer of Russia for its technology and I would say that I would be much more circumspect about transferring military technology to the Chinese, especially those which allow them to have better command control or communications among their forces, so I would just rule that out.

    Dual-use technology remains a very thorny problem and, of course, I guess the case which is most in front of us recently was the issue of helping the Chinese with nuclear power reactors, at the time of Jiang Zemin's visit here to Washington, in light of the fact that the Chinese have, over a period of many, many years given assistance in nuclear technology to the Pakistani program. My own view on that is that each one of those cases must be the dual use case, must be looked at separately. I would have supported the use of United States technology for nuclear power, commercial nuclear power in China, but many of the dual-use technologies that might be traded to China, in my mind, are over the long run of considerable concern. That is a very short answer and I hope I am getting to the issues that are on your mind.
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    Mr. ABERCROMBIE. Yes, you are. Thank you very much.

    Mr. Woolsey.

    Mr. WOOLSEY. I'll give an even shorter one. I think we have moved too quickly and too fully to remove the constraints on exports, particularly of some sensitive types of dual-use technology and I think that whole issue deserves another look.

    I think we have dismantled the COCOM on machinery on this and moved away from it so sharply and decisively that we have allowed the export of some things like supercomputers and the like that we should not have. I think the issue ought to be re-examined by the Congress and the Administration.

    Mr. ABERCROMBIE. Mr. Chairman——

    Mr. DEUTCH. If I could just make a remark here, I would like to associate myself with that. Despite efforts to put together something after COCOM, the cold war sort of East-West controls, the so-called Vassinar process, I do not think meet effectively, either with respect to other countries or even within the U.S. government itself, adequate attention to dual-use technology exports to these countries of concern.

    Mr. ABERCROMBIE. Thank you. Mr. Chairman, I probably should have prefaced my question with another brief observation, that part of my concern, gentlemen, comes from the fact that much of the business being done in the People's Republic of China is being done by the People's Liberation Army through front—well, maybe front sounds—I mean, through corporations which they, in effect, control. So, my concern is that we may be, in fact, financing activities of the People's Liberation Army that may not be in the interest of the United States.
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    Mr. DEUTCH. That is certainly going on.

    Mr. ABERCROMBIE. Thank you, Mr. Chairman.

    The CHAIRMAN. Mr. Bartlett.

    Mr. BARTLETT. Thank you. I want to thank you both for your testimony and for your endurance. Both of you mentioned the problem of our dependence on foreign oil, the fact that we have 2 percent, as you indicated, of the known reserves of oil and we now use about 25 percent of the world's energy.

    I would think it would demand a national energy policy. You are both correct, I think, in implying both implicitly and sometimes explicitly that it is pretty silly not to have a national energy policy and as far as I know, we have none.

    Mr. Woolsey, you mentioned the Russian control instability and the risk that we run of an inadvertent errant attack from that. Our President has on at least 24 occasions that we have documented, told the American people that they can sleep well tonight because not one of their children is targeted by a Russian intercontinental ballistic missile. Now, he knows that that cannot be verified, he knows that even if it is true, it is irrelevant, because the Russians have bragged that they can retarget their missiles in ten seconds and we know they can do it within about 30 seconds.

    Why would he continue to tell the American people this?
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    Mr. WOOLSEY. Well, I wish he would not continue to make that statement, Mr. Bartlett, because although it may be technically true, as you suggest, I believe it is misleading. The only circumstance in which the fact that the Russian ICBM's, let us say, are not targeted on American targets, if the Russians have, in fact, done what they say they have done, the only circumstance in which that really would be important would be a theoretical launch because some wires got crossed or something like that, which is far and away the least likely situation for any kind of inadvertent launch to occur.

    I think you are quite correct in saying that in well under a minute, these missiles for everything I have known about them over the years, could be retargeted, so any of the interesting and troubling scenarios, such as a Russian response to a Norwegian sounding rocket and so forth, as I was talking about earlier, would be a circumstance in which the missiles would be quickly and readily retargeted.

    It is almost like saying, if I could use only a slight sense of hyperbole, if I had a revolver here in my pocket and I took it out and pointed at the ceiling, saying I am not targeting any Member of the committee. It is true, I would not be, I guess, I am pointing it at the ceiling. But, if I lowered it, I would be. It just takes a few seconds.

    That is the only sense in which the President's statement is accurate and I think he used the philosophy years ago, there is a phrase that something can be true, but trivially true. I think what the President said on this is true, but it is trivially true, and I think it is misleading.

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    Mr. ABERCROMBIE. Mr. Chairman, may I note for the record that Mr. Woolsey was pointing at Mr. Bartlett? [Laughter.]

    Mr. BARTLETT. I have one other question. Both of you mentioned the potential threat of damage from terrorist weapons of mass destruction. Dr. Deutch mentioned damage to our infrastructure. Mr. Woolsey mentioned the potential use of the launch of a SCUD missile from a tramp steamer. After you launch the missile, you could kick the launcher overboard and we would not even know who did it and to whom to retaliate.

    Let me suggest that perhaps the ultimate terrorist weapon of mass destruction would be a nuclear weapon that was not detonated on a city or on a military target, but was detonated high in the atmosphere. A single weapon detonated over Nebraska, for instance, the EMP from that weapon could shut down our total domestic infrastructure. No more power, no more communications, no more transportation.

    Would you comment on the potential for this type of nuclear EMP production?

    Mr. WOOLSEY. The effects of electro-magnetic pulse and our efforts to design systems and communication systems and the like that would not be susceptible to them is worth many books, not just an answer or even a chapter or two.

    I, in order to get a nuclear weapon over the United States, one would have to have an intercontinental ballistic missile or perhaps a launch of a shorter range missile from some type of platform of the sort you describe.
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    There is an even more troubling notion, Congressman Bartlett, which is that a missile carrying a nuclear warhead launched straight up from a rogue state and detonated at a particular altitude could well take out a very, very large number of important satellites. Indeed, that might be the most effective use of a single nuclear weapon that a North Korean or an Iraqi Government someday might have.

    So, whether one is talking about effects in space or EMP effects in the area, yes, there are some very important and troubling concerns that could derive from that type of use of a nuclear weapon, quite apart from it being detonated ground burst or at a burst to maximize overpressure in such a way as to destroy troops and people on the ground.

    Mr. BARTLETT. Thank you. The satellite effect you mentioned would be primarily due to pumping up the Van Ellen belts and it would destroy, I understand, $50 billion worth of satellites and it would do no good, even if you could, to launch a new one, because the Van Ellen belts are still pumped up.

    We have only two satellites that are immune to this and that is the two Illmester satellites. All others are enormously vulnerable is my understanding.

    Mr. WOOLSEY. Well, it depends on the altitude, as I understand it. Lower orbiting satellites would be particularly vulnerable to this kind of a thing.

    Mr. BARTLETT. Thank you very much.

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    The CHAIRMAN. We better break right here and have a vote and come back and get Mr. McHale. One thing, you can ask him about those ICBM's from China, when the President says that none are targeted on us.

    Mr. Deutch, are you going to have to leave?

    Mr. DEUTCH. Mr. Chairman, could I just——

    Mr. MCHALE. Mr. Chairman, I do not want to cause inconvenience to the witnesses to have them remain solely for my questioning. Let me present two questions that they could answer in writing, if they would?

    Mr. DEUTCH. Surely.

    Mr. MCHALE. Then we could break, I think, with mutual convenience.

    Dr. Deutch, if you were the Secretary of Defense, what would be your first policy initiative?

    Mr. Woolsey, you indicate on page six of your testimony that, in your judgment, it will do little good, referring to the Persian Gulf crisis, little good to try to use air strikes alone. Are you advocating the use of ground forces?

    Mr. WOOLSEY. I can answer that quickly. No. My comment was meant to deal with little good to use them alone against storage of weapons of mass destruction. Air strikes that break the power of the Republican Guard, together with such steps as establishing a no fly zone over the whole country and recognizing a government in exile, that is what I am talking about, not using ground forces against Iraq.
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    Mr. MCHALE. Thank you, Mr. Chairman.

    The CHAIRMAN. Thank you, and again, we are going to try to make that vote and adjourn the meeting. Thank you very much, both of you. You do a good service for your country.

    Mr. WOOLSEY. Thank you, Mr. Chairman.

    Mr. DEUTCH. Thank you.

    [Whereupon, at 12:23 p.m., the committee was adjourned.]