Weekly Intelligence Notes #13-01
2 April 2001

WEEKLY INTELLIGENCE REPORT (WIN) #13-01 dated 2 April 01

WINs are commentaries on open source intelligence issues and items written, edited, and produced by Roy Jonkers, for non-profit educational use by AFIO members and WIN subscribers. Associate editors Don Harvey and John Macartney contributed articles to this WIN. Opinions expressed are those of the editors or authors providing the basic references listed with each article.

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ANNOUNCEMENT: Robert M. McNamara, Jr., General Counsel, Central Intelligence Agency, previously Asst General Counsel for Enforcement at the Treasury Department, and former Georgetown Law professor, will speak at AFIO's Business Intelligence Symposium on 4 May. The Symposium on "PROTECTING AMERICA'S BUSINESS SECRETS: THREATS AND SOLUTIONS," features an all-star cast of speakers in a one-day super seminar. The place is the Ronald Reagan Center in downtown Washington DC on May 4th, 2001. See details at our Website at www.afio.com, or email us for more information afio@afio.com.

AFIO Members - if you cannot make it to this super event, let others know. Education on intelligence and security is our mission! Spread the word to the corporate and business communities! Open to non-members. This is a good one - useful, practical. Guaranteed. (Jonkers)


SECTION I -- CURRENT INTELLIGENCE

US NAVY EP-3e RECONNAISSANCE INTELLIGENCE PLANE COLLIDES WITH CHINESE JET.
In an incident well covered by the mass media, a US Navy EP-3e operating in international airspace over the South China Sea was intercepted by two Chinese F-8 jet fighters on 31 March. China is claiming, improbably, that the EP-3 veered into one of the fighters -- more likely the F-8 came to close, overshot or otherwise accidentally rammed the EP-3. Chinese military pilots do not get much flying time and are therefore unlikely to be as skilled as American fighter pilots. The F-8 crashed into the sea and its pilot is missing. The EP-3e pilot made an emergency landing at a nearby Chinese military airfield on Hainan Island. A spokesman for the Chinese Foreign Ministry stated that it was "international practice" to track foreign surveillance planes along Chinese territory - as has been done since the 1960's. Intercepts are indeed routine, but Admiral Blair, Commander-in-Chief, US Pacific Command, noted that intercepts had recently become more aggressive, endangering both US and Chinese planes and crew, saying "it's not a normal practice to play bumper cars in the air."
                  The EP-3e is a turboprop stand-off surveillance platform for intelligence collection, presumably electronic and communications intelligence, to provide updates on the targeted state's order of battle deployments and system and equipment operating characteristics. The sensitive equipment aboard was most likely destroyed by the 24-man (including women) crew prior to landing, in accordance with standard operating procedures. The crew is said to be kept in quarters on Hainan, and the plane was apparently boarded by Chinese forces. The Chinese have protested the landing of the aircraft on their territory.
                  The Chinese Air force intercept capability has been bolstered in recent years by upgrades in their fighter aircraft (still light-years behind the US, particularly in avionics). Chinese policies are estimated to be affected by (1) US policy towards Taiwan, including US arms flows to the island, (2) the US position of building a Ballistic Missile defense system, which puts the Chinese in the position of having to increase budget expenditures on an increased number of ballistic missiles to retain their view of a credible deterrent; and (3) their view of territorial waters, which, based on including their claimed territory of Taiwan and the Spratly islands, covers the entire South China Sea.
                  Internally China appears to be moving from the failed communist paradigm to an increasing nationalist posture. Their national budget priorities have stressed economic development over military expenditures, even though they have bought more modern equipment from the Russians. Their key political issue with the US centers on Taiwan, which China regards as a maritime province. As tensions heated up over Taiwan in the mid-1990's, it began sending its aircraft over the Taiwan Strait. Now, China has acquired more than 50 SU-27 fighter planes from the Russians, as well as 10 SU-30 attack planes and S-300 surface-to-air missiles. China has also sent F-8 planes to Hainan. The aircraft is based on a design that the Soviets rejected and that China obtained before its alliance with the Soviet Union collapsed. It looks like a huge MIG-21.
                  As a result of all this, after decades of keeping watch over its own skies, China's Air Force has begun in recent years to range farther out above the waters beyond its borders. The United States, in turn, has expanded its intelligence-gathering in the region, as Washington's security interests have increasingly turned towards Asia. Current US policy is said (in the media) to be more influenced by hard-line (anti-Chinese) thinkers (e.g. Dep SecDef Wolfovitz et.al.) still fighting the Chinese peril dating from the Quemoy & Matsu days, and less by the business lobby seeking markets in China or the strategists such as Henry Kissinger and Presidents Nixon and Bush Sr. as well as Clinton. The atmospherics aside, one must expect that cool heads and pragmatic judgments will prevail on all sides, and that the reconnaissance plane and crew will be returned forthwith. Intelligence, including stories of spies, defectors and reconnaissance, remain a center of media attention - probably not a preferred posture. (Jonkers)
(Wash Post 2April01, p. A1//Pomfret) (NY Times, april3, 01// M. Gordon)
http://www.washingtonpost.com/wp-dyn/articles/A26398-2001Apr2.html
http://www.nytimes.com/aponline/world/AP-US-China-Plane.html
http://www.washingtonpost.com/wp-dyn/articles/A28747-2001Apr2.html
http://www.washingtonpost.com/wp-dyn/articles/A30085-2001Apr3.html

CIA STATION CHIEF RECALLED FROM BUENOS AIRES -- The disclosure of the CIA Station Chief's identity, including name and photo in the local papers, blamed on Argentine officials, reflected existing personal irritations and organizational tensions between the CIA and Argentine intelligence. He has been recalled. (Macartney) http://www.pagina12.com.ar/2001/01-01/01-01-07/pag15.htm


SECTION II -- CONTEXT AND PRECEDENCE

TOXIC THREAT INTELLIGENCE
-- Whether the main THREAT to US security is enraged Islamic fundamentalism, some Arab fanatic hiding in Afghanistan, Cyber insecurity about our infrastructure, an aroused China, or domestic malcontents, is a matter of debate. There is little debate about another pervasive threat, the biological threat, for although the deliberate version is recognized (bio/WMD terrorists), the national self-suicidal biochem threat embedded in our culture and way of life gets scant recognition in the Threat lore - except by cultists.
                  The Federal Center for Disease Control reported on March 21st surprisingly high levels of toxic chemicals in items we use every day - soap, shampoo etc. A 1999 study showed high levels of contamination with pesticides, and the National Academy of Science estimated last year that 600,000 children are born each year with elevated levels of mercury. The studies show that pollution is personal, individual. We are becoming walking, talking toxic waste sites.
                  Since the petrochemical industry started in the 1940's some 85,000 new chemicals have been manufactured and released into the environment. Many public health officials see a connection between this phenomenon and the increased instances of asthma, reproductive disorders, low sperm counts, genital defects in male infants, Parkinson's disease, brain tumors and leukemia. The data are not definitive. The threat is slow and subtle. The cost to change our culture and attack the problem is high. Probably too high, unless and until disaster strikes. (FFJournal, Mar22,01) (Jonkers)

US NAVY CASE VS DANIEL KING -- At the instigation of Shelby, Chairman of the Senate intelligence committee, the DOD IG is investigating Navy handling of the espionage case. Daniel King is a 20 year Navy Petty Officer and cryptologist who failed a polygraph upon reassignment to NSA at Ft Meade, MD in 1999. Under prolonged (e.g., 16 hours at a crack) questioning, he confessed to spying for Russia during a previous NSA tour and was held for some 520 days in a Quantico brig. However, he later recanted his confession, and when the case finally came to trial last month, a Navy judge said the confession was dubious and there was no other evidence -- case dismissed. King's civilian attorney, Jonathan Turley, followed an unusual strategy involving, among other things, an attempt to turn the tables on the government by relentlessly accusing the military judge and opposing counsel of security violations both large and small (such as using a cellular telephone inside a SCIF, failing to use cover sheets on classified documents, etc.). King has applied for 20 year retirement and will leave the Navy. He plans to SUE the Navy for damages. (Macartney)
http://www.nytimes.com/2001/03/31/world/31CHIN.html
http://www.nytimes.com/aponline/national/AP-Navy-Espionage.html
http://www.washingtonpost.com/wp-dyn/articles/A7499-2001Mar28.html
http://www.fas.org/sgp/news/secrecy/2001/03/033001.html

PREDATORS -- A SCARCE INTELLIGENCE RESOURCE --The media reported that two CinC theater commands were competing for Predator UAV (Unmanned Airborne Vehicle) assets for intelligence purposes. Reportedly, the urgent requirement for Predators to relieve the flying unit now watching over Iraq requested by CINCENT has been shunted aside by the Joint Chiefs to use the Predators to respond to even more urgent needs in the Macedonia and Kosovo area. It would appear the often-predicted day when the US military cannot handle two simultaneous conflicts successfully has arrived even before the direct US involvement in two conflicts has arrived.
  It was also reported that the Air Force was simultaneously enthusiastically working to expand the demand for the scarce drones in non-intelligence roles. The Air Force's "UAV Battlelab" at Eglin AF Base, Florida is working to "missionize"(sic) Predator's capabilities for air-interdiction, close-support and search-and-rescue missions. Under the "Battlelab's" approach, the Predator would serve as a Forward Air Controller (FAC), primarily as a communications link. but could eventually be armed and "weaponized" (in Air Force jargon). Use of the UAV as an air-to-ground missile shooter has already been successfully tested, while testing the platform as an air-to-air missile shooter is being considered.
  In the "nothing succeeds like success" theme, it is reported that the Air Force Air Combat Command is locked in a bureaucratic struggle with the Air Force Materiel Command's Big Safari program over who will control Predator's acquisition destiny. It can be hoped, perhaps optimistically, that in all the Johnny-come-lately fuss by the heavies, someone will ensure the intel types get enough Predators to do their job. Since the Air Force has been systematically down-grading intelligence and "integrating" the function into Operations for the last couple of years, optimism may be misplaced. (Harvey) (Aviation Week 26 Mar '01, p.22; Jane's Defense Weekly 28 Mar '01 by Michael Sirak)


SECTION III -- CYBER INTELLIGENCE

WARNINGS OF CYBER ATTACKS --
In the last several weeks, the National Security Adviser, the Director of the FBI, and the four-star general leading the Defense Department computer network defense have all pointed in varying statements to the US vulnerability to cyberspace attacks by hostile nations or international groups, criminal and terrorist. Condoleeza Rice told a forum on Internet security recently, "The very technology that makes our economy so dynamic and our military forces so dominating also makes us more vulnerable."
                   FBI Director Louis J. Freeh, in introducing the new head of the three-year old National Infrastructure Protection Center (NIPC), Ronald Dick, noted his wealth of experience in 24 years in the FBI in a variety of fields, including heading the NIPC's computer investigations unit. Mr. Dick said that an attack from a terrorist group, rogue nation, disgruntled former employee or hacker, could destabilize the nation's economy unless there were closer cooperation within the federal government and better coordination between private business and the multi-agency NIPC.   Dick noted that at least 50 computer viruses are generated weekly and that the biggest immediate problem facing companies is a lack of safeguards to prevent former employees who maintain computer access from attacking vital computer systems. A major hurdle for the NIPC is that numerous business executives fear involvement with the FBI will hurt their enterprises by bringing public attention to cyber problems that might otherwise be addressed privately.
                  Meanwhile the NIPC, which has about 100 people from CIA and the Defense Department as well as the FBI, has been hampered by behind-the-scenes power struggles among various federal agencies, especially between Defense and the FBI. The new deputy commander of the NIPC, Rear Admiral James B Plehal ("My technology background consists of a 17-year-old son.") said they are determined to reduce the friction and improve cooperation.
                  The Commander U.S. Space Command, General Ralph E. Eberhart, USAF, has said to reporters that he is worried about China's growing capability to conduct computer warfare and that North Korea, Iran, Iraq, and other nations (e.g. India, Russia) are also working on cyber-attack capabilities that could potentially threaten the US military's increasing reliance on information systems. Space Command has been designated by the Defense Department as the unit in charge of "computer network defense" and its offensive counterpart, "computer network attack." (Harvey) (Wash Times 29 Mar '01, p.3; USA Today 23 Mar '01, p.4; Wash Post 20 Mar '01; Wash Post 21 Mar '01 p. A16)

NEW CLOAKED-CODE THREAT TO CORPORATE SECURITY-- A new technique for disguising programs aimed at cracking corporate networks could raise the stakes in the heated battle between hackers and security experts. During a seminar last week at the CanSecWest conference in Vancouver, British Columbia, a hacker named "K2" revealed a program he created that can camouflage the tiny programs that hackers generally use to crack through system security. The cloaking technique is aimed at foiling the pattern-recognition intelligence used by many intrusion detection systems, or IDSes, known as the burglar alarms of the Internet.
http://www.zdnet.com/zdnn/stories/news/0,4586,5080532,00.html
http://news.cnet.com/news/0-1003-200-5423454.html
(Levine's Newsbits 04/02/01)


SECTION IV - BOOKS AND SOURCES

CRYPTONICON, a novel by Neal Stephenson, ( Morrow, 2000), reviewed by Pete Speer: "Cryptonomicon" by Neal Stephenson is almost indescribable. Better, deeper, and wider than W.E.B. Griffin, more detailed and yet easier to follow than Tom Clancy, this novel is a twenty-four carat feast for the mind. The reader will recognize under various guises Statistical Tabulating/IBM Commander Rochefort at Station Hypo, and others whom it will be great fun to decipher. The sample at the site below gives only the smallest hint of the continuing and ever changing feast inside -- comedy, history, action, adventure, romance and Reimann equations -- from punch cards to quantum computers ending with a saga of buried treasure. It makes Indiana Jones seem like a parlor prankster. ... Do not begin to read it on your honeymoon or place it at your watch station. And the N.Y. Times and the N.Y. Post agree!!
"Electrifying, hilarious. sprawling, picaresque novel about code making and code breaking. it wants to blow your mind while keeping you well-fed and happy." -The New York Times Book Review
"Neal Stephenson....is the rarest of geniuses, capable of appreciating math, cultural traditions, free markets, computer programming, and the human psyche-through the same rationalistic lens-without ignoring the subtleties involved in any of them." -New York Post (Speer/Macartney)
http://www.cryptonomicon.com/text.html

HAVANA CONFERENCE DOCUMENTS ON BAY OF PIGS - The conference, which included Cuban as well as American (CIA) participants, opened March 23rd, with Fidel Castro in attendance. Several thousand Cuban documents were declassified and released. Not much appeared to be new, apart from the novelty of the occasion. The Czechs apparently supplied Cuba with 50,000 9-millimeter guns and millions of bullets in 1959, through a Swiss middleman, financed by CARE, an American religious organization, which apparently, as part of its charity work, is a major buyer of Cuban sugar. We will await a full report by AFIO Board member Sam Halpern, who, as a charter member of Operation Mongoose, attended the event. (Jonkers) (NYT 23 March 01, and March 25, p. 10).


SECTION V -- LETTERS

LETTER ON NAVY EP-3E
RECCE Aircraft Ditching Characteristics: "I was a member of VP-09 and junior pilot when our squadron P-3 ditched(controlled) off the Aleutians in 1978. Of note, the sea state and conditions were extreme due to the gale force winds and snow squalls. One engine was out due to a fire and another was failing. This was a straight stick P-3, but one lesson learned was that the airframe held up very well despite skipping and plowing into a heavy swells. The wings departed and then the airframe sank within a minute. All got out except for one member trapped in the rear, 4 others died from other environmental problems.
                  "If the hydraulics were in fact failing, I would not attempt a ditch. It would be nearly impossible since you want to be as slow as possible and controllability would be a big problem, especially with an engine out and other possible structural problems. On a runway landing, you can keep your speed up and roll out further if necessary. From a pilot's perspective, fly-ability (not the additional lower fuselage weight) would be my primary concern for deciding to ditch it or not.
                  "Of interest, in my past, P-3 Mission Commander qualification boards often addressed a similar scenario where a hostile country intercepts and attempts to force your P-3 to land in a 'hostile country.' What should you do? The correct answer then was 'No.' You were to evade/ditch first, rather than fly it in. Of course, is China really considered a 'hostile' country?" (courtesy Ed Badolato)

LETTER TO PRESIDENT BUSH BY STEELE -- Robert Steele, the intrepid apostle of improved Open Source exploitation by the Intelligence Community, sent a letter to President Bush telling him "that he is being ill-served by an intelligence community obsessed with secrets."
http://www.oss.net/Papers/white/LettertothePresident.doc

SENATOR MOYNIHAN LETTER ON GORBACHEV AND CIA FORECASTS OF THE FUTURE -- The distinguished former senator from New York, a member of the Senate Select Committee on Intelligence for eight years, commented recently on the CIA Conference on Cold War Intelligence estimates at Princeton University. In a letter to the Post, Senator Moynihan concurred with a reporter's view that CIA missed the call on predicting the collapse of the Soviet Union. He noted that Gorbachev's address at the United Nations in 1988 indeed marked the end of the Cold War and an end to the Soviet Union as we had known it, and CIA blew it.
                  One may be permitted to observe that such calls are immeasurably facilitated by hindsight. For the IC analysts and officials at the time, making these forecasts in the context of almost fifty years of Cold War, and with a deep appreciation and suspicion of Soviet objectives and deception as part of the prevailing US culture, the call was not as simple. Or perhaps it was as easy as the financial experts predicting the course of the stock market in the year 2000. Forecasting the future, with secrecy or without, is a dicey proposition. Gorbachev, a former KGB chief, and his UN speech in 1988 notwithstanding, might have been deceptive or if not, been overthrown -- as he almost was in a coup. The Soviet threat might not have gone away.
                  Those who have read these Estimates know that they are frequently using caveats and conditional terminology about the opaque future. The evidence of CIA's call on the USSR presented at the Conference, one way or the other, appeared to this observer at the Conference as somewhat ambiguous -- except for the comfortingly impressive and diverse intellects that were brought to bear on the problem. But it was also clear that US Executive policy and decision-makers, accepting intelligence as only one input in their national decision-making, pursued the proper policies to defeat the USSR in the 1990's almost as completely as Nazi Germany had been in 1945. The USSR has been dismembered, impoverished, turned inside-out by intelligence, and made militarily irrelevant except for the potential threat of rogue uses for its nuclear & biological material.
                  We can move on from the discussion of how many intelligence angels danced on the head of a pin. The war was won. Enough already. (Jonkers) (Moynihan/WPost)

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