Cyber attacks outrank terrorists on U.S. threat list

Director of National Intelligence James Clapper listens Tuesday on Capitol Hill in Washington as he testifies during the Senate Intelligence Committee hearing on worldwide threats. Clapper presented the intelligence community's overview of global threats posed by terrorism, cyber attacks, weapons of mass destruction, the civil war in Syria and the unsettled situation in post-Arab Spring nations.
Director of National Intelligence James Clapper listens Tuesday on Capitol Hill in Washington as he testifies during the Senate Intelligence Committee hearing on worldwide threats. Clapper presented the intelligence community's overview of global threats posed by terrorism, cyber attacks, weapons of mass destruction, the civil war in Syria and the unsettled situation in post-Arab Spring nations. Susan Walsh/AP Photo

Washington - Cyber attacks and cyber espionage pose a greater potential danger to U.S. national security than al-Qaida and other militants that have dominated America's global focus since Sept. 11, 2001, the nation's top intelligence officials said Tuesday.

For the first time, the growing risk of computer-launched foreign assaults on U.S. infrastructure, including the power grid, transportation hubs and financial networks, was ranked higher in the U.S. intelligence community's annual review of worldwide threats than worries about terrorism, transnational organized crime, and proliferation of weapons of mass destruction.

The startling reappraisal comes a day after President Barack Obama's national security adviser, Tom Donilon, complained of "cyber intrusions emanating from China on an unprecedented scale" and said China-based digital attacks on U.S. businesses and institutions had become "a key point of concern" for the White House.

"The international community cannot afford to tolerate such activity from any country," he warned in a speech at The Asia Society in New York. He urged Beijing to "take serious steps to investigate and put a stop to these activities."

Appearing Tuesday before the Senate intelligence committee, James Clapper, director of national security, said Russia and China are unlikely to launch a devastating cyber attack against the United States outside of a military conflict that they believe threatens their interests. But in his written statement, Clapper said computer hackers "could access some poorly protected U.S. networks that control core functions, such as power generation" although their ability to cause "high-impact, systemic disruptions will probably be limited."

"It's hard to over emphasize (cyber's) significance," Clapper told the committee.

Clapper testified alongside CIA Director John Brennan, FBI director Robert S. Mueller III, Lt. Gen. Michael Flynn, who heads the Pentagon's Defense Intelligence Agency; Matthew Olsen, who heads the National Counterterrorism Center; and Philip Goldberg, who heads the State Department's Bureau of Intelligence and Research.

The downgrading of the terrorist threat came with notable qualifiers. As was clear in the lethal attack last Sept. 11 on U.S. diplomatic and intelligence compounds in Benghazi, Libya, al-Qaida's local affiliates and sympathizers in the Middle East and North Africa still seek to harm U.S. interests.

Officials warned that despite setbacks, al-Qaida in the Arabian Peninsula, the affiliate based in Yemen, aims to carry out attacks on U.S. soil and "continues to adjust its tactics, techniques and procedures for targeting the West."

But aggressive counter-terrorist operations, including using drone-launched missiles to kill individuals and small groups in northwest Pakistan, "have degraded core al-Qaida to a point that the group is probably unable to carry out complex, large-scale attacks in the West," Clapper said.

Al Qaeda and its affiliates played little or no role in the popular uprisings across the Middle East and North Africa in 2011. But the fragile new governments in Egypt, Yemen and Libya, and ongoing unrest in Syria and Mali, "have offered opportunities" for what Clapper called "unpredictable" attacks by terrorist groups on U.S. facilities and allies.

In response, Sen. Dianne Feinstein, D-Calif., the committee chairwoman, noted that "the terrorist threat has receded" because of a broad array of U.S. efforts, including criminal prosecutions. She noted that 438 people were convicted of terrorism-related charges in U.S. courts between 2001 and 2010.

In a separate hearing at the Senate armed services committee, Gen. Keith Alexander, who heads the Pentagon's new U.S. cyber command, which conducts military operations, as well as the National Security Agency, which carries out digital espionage overseas, said the number of cyber attacks is growing.

"It's getting worse," he said, citing more than 140 attacks on Wall Street over the last six months. Last August, he added, a computer intrusion at the Saudi Arabian national oil and gas company destroyed data on more than 30,000 computers.

Outside experts blamed both assaults on Iran, and Alexander was asked whether the Obama administration had considered retaliation.

"I think this gets to the heart of ... when does the defense department step in to defend the country?" Alexander replied, saying he could not address specifics. Defense experts have struggled to define precisely when and how U.S. military or covert action should be taken to prevent a potential cyber attack, especially when many appear all but impossible to trace.

On other fronts, Clapper warned that congressionally mandated budget cuts under the so-called sequester would create numerous problems for intelligence collection and analysis. The overall budget for the 16 U.S. intelligence agencies has grown sharply over the past decade and now is about $75 billion.

"We'll reduce human, technical and counterintelligence operations, resulting in fewer collection opportunities while increasing a risk of strategic surprise," he said.

The intelligence assessments of most danger zones around the globe changed little from last year.

Iran continues to enrich uranium and is moving closer to being capable of constructing a nuclear weapon, but it has not decided to build one, according to Clapper's statement. Iran has "the scientific, technical and industrial capacity to eventually produce nuclear weapons. This makes the central issue its political will to do so," Clapper said.

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