[House Hearing, 109 Congress]
[From the U.S. Government Printing Office]



                   BUILDING THE INFORMATION ANALYSIS
                    CAPABILITY OF THE DEPARTMENT OF
                           HOMELAND SECURITY

=======================================================================

                                HEARING

                               before the

               SUBCOMMITTEE ON INTELLIGENCE, INFORMATION
                 SHARING, AND TERRORISM RISK ASSESSMENT

                                 of the

                     COMMITTEE ON HOMELAND SECURITY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 16, 2005

                               __________

                            Serial No. 109-2

                               __________

       Printed for the use of the Committee on Homeland Security
                                     
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                     COMMITTEE ON HOMELAND SECURITY

                 Christopher Cox, California, Chairman

Don Young, Alaska                    Bennie G. Thompson, Mississippi
Lamar S. Smith, Texas                Loretta Sanchez, California
Curt Weldon, Pennsylvania, Vice      Edward J. Markey, Massachusetts
Chairman                             Norman D. Dicks, Washington
Christopher Shays, Connecticut       Jane Harman, California
Peter T. King, New York              Peter A. DeFazio, Oregon
John Linder, Georgia                 Nita M. Lowey, New York
Mark E. Souder, Indiana              Eleanor Holmes Norton, District of 
Tom Davis, Virginia                  Columbia
Daniel E. Lungren, California        Zoe Lofgren, California
Jim Gibbons, Nevada                  Sheila Jackson-Lee, Texas
Rob Simmons, Connecticut             Bill Pascrell, Jr., New Jersey
Mike Rogers, Alabama                 Donna M. Christensen, U.S. Virgin 
Stevan Pearce, New Mexico            Islands
Katherine Harris, Florida            Bob Etheridge, North Carolina
Bobby Jindal, Louisiana              James R. Langevin, Rhode Island
Dave G. Reichert, Washington         Kendrick B. Meek, Florida
Michael McCaul, Texas
Charlie Dent, Pennsylvania

                                 ______

 Subcommittee on Intelligence, Information Sharing, and Terrorism Risk 
                               Assessment

                   ROB SIMMONS, Connecticut, Chairman

CURT WELDON, Pennsylvania            ZOE LOFGREN, California
PETER T. KING, New York              LORETTA SANCHEZ, California
MARK E. SOUDER, Indiana              JANE HARMAN, California
DANIEL E. LUNGREN, California        NITA M. LOWEY, New York
JIM GIBBONS, Nevada                  SHEILA JACKSON-LEE, Texas
STEVAN PEARCE, New Mexico            BOB ETHERIDGE, North Carolina
BOBBY JINDAL, Louisiana              JAMES R. LANGEVIN, Rhode Island
DAVE G. REICHERT, Washington         KENDRICK B. MEEK, Florida
CHARLIE DENT, Pennsylvania           BENNIE G. THOMPSON, Mississippi 
CHRISTOPHER COX, California (Ex      (Ex Officio)
Officio)

                                  (II)


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               STATEMENTS

The Honorable Rob Simmons, a Representative in Congress From the 
  State of Connecticut, and Chairman, Subcommittee on 
  Intelligence, Information Sharing, and Terrorism Risk 
  Assessment.....................................................     1
The Honorable Zoe Lofgren, a Representative in Congress From the 
  State of California, and Ranking Member, Subcommittee on 
  Intelligence, Information Sharing, and Terrorism Risk 
  Assessment.....................................................     2
The Honorable Christopher Cox, a Representative in Congress From 
  the State of California, and Chairman, Committee on Homeland 
  Security.......................................................     4
The Honorable Bennie G. Thompson, a Representative in Congress 
  From the State of Mississippi, and Ranking Member, Committee on 
  Homeland Committee.............................................     5
The Honorable Charlie Dent, a Representative in Congress From the 
  State of Pennsylvania..........................................    19
The Honorable Bob Etheridge, a Representative in Congress From 
  the State of North Carolina....................................    17
The Honorable Peter T. King, a Representative in Congress From 
  the State of New York..........................................    16
The Honorable James R. Langevin, a Representative in Congress 
  From the State of Rhode Island.................................    20
The Honorable Sheila Jackson-Lee, a Representative in Congress 
  From the State of Texas........................................    25
The Honorable Daniel E. Lungren, a Representative in Congress 
  From the State of California...................................    22

                                WITNESS

Lieutenant General Pat Hughes, (Retired), Acting Under Secretary, 
  Information Analysis and Infrastructure Protection, Department 
  of Homeland Security
  Oral Statement.................................................     6
  Prepared Statement.............................................     7

                                APPENDIX
                   Material Submitted for the Record

Questions and Responses submitted by the Honorable Bennie 
  Thompson.......................................................    31

 
                   BUILDING THE INFORMATION ANALYSIS
           CAPABILITY OF THE DEPARTMENT OF HOMELAND SECURITY

                              ----------                              


                      WEDNESDAY, FEBRUARY 16, 2005

                     U.S. House of Representatives,
          Subcommittee on Intelligence, Information
            Sharing, and Terrorism Risk Assessment,
                            Committee on Homeland Security,
                                                     Washington, DC
    The subcommittee met, pursuant to call, at 2:06 p.m., in 
Room 1334, Longworth House Office Building, Hon. Rob Simmons 
[chairman of the subcommittee] presiding.
    Present: Representatives Simmons, King, Lungren, Pearce, 
Dent, Cox, Lofgren, Etheridge, Langevin, Thompson, and Jackson-
Lee.
    Mr. Simmons. [Presiding.] The Subcommittee on Intelligence, 
Information Sharing, and Terrorism Risk Assessment will come to 
order.
    The subcommittee is meeting today to hear testimony on how 
the fiscal year 2006 Department of Homeland Security budget 
request helps further the information sharing and analysis 
capabilities of the Department of Homeland Security. I am told 
that we only have this room until 4:00 p.m., 1600 hours, today, 
so I will be short in my comments, and then we will try to 
extend to all members the opportunity to ask questions, but 
also remind them that the room will be made available to 
another group at 4 p.m.
    I would like to recognize myself for an opening statement. 
As we begin this first hearing of the Committee on Homeland 
Security, Subcommittee on Intelligence, Information Sharing and 
Terrorism Risk Assessment, I would like to start by thanking 
the Chairman, Chairman Cox, for his leadership in helping to 
establish the full committee as a standing committee of 
Congress. I look forward very much to working with my 
colleague, Representative Lofgren from California, as the 
Ranking Member of the subcommittee, and also the Ranking Member 
of the full committee, Representative Thompson, who is with us 
here today.
    I represent the Second District of Connecticut. On 
September 11, we lost 12 friends and neighbors. On September 
11, we all failed in our constitutional responsibility to 
provide for the common defense. This subcommittee has a vital 
role to build our capabilities in intelligence, information 
sharing and risk assessment to help prevent another terrorist 
attack.
    I would also like to make a second point. I believe in 
bipartisanship when it comes to national security and homeland 
security. When I joined the U.S. Army almost 40 years ago, I 
put these dog tags around my neck. I wore them until I retired 
from the U.S. Army Reserve in the year 2003. These dog tags 
have my name on them, my serial number, my blood type and my 
religion, but there is no mention of party affiliation. During 
my years of public service, I have tried to be bipartisan. I 
look forward to conducting the work of this subcommittee in a 
bipartisan fashion.
    Information analysis and warning is perhaps the most 
important capability of the Department of Homeland Security. 
Intelligence must drive our protection decisions, resource 
allocations, and homeland security priorities. Since its 
inception in March 2003, the Department of Homeland Security 
has worked to construct a robust analytical capability and has 
dedicated itself to fulfilling the broad statutory functions 
outlined in the Homeland Security Act. The committee is 
encouraged by the progress to date, but there is a lot more 
work to do, and the responsibility for that work falls on us.
    General Hughes, you have some challenges and opportunities 
ahead of you. The Intelligence Reform and Terrorist Prevention 
Act of 2004 created a Director of National Intelligence and a 
National Counterterrorism Center. This new reality will require 
the office of Information Analysis of DHS to adjust to a new 
operating environment. IA must take this opportunity to 
continue to build on its initial progress and construct a fully 
functioning and operational Intelligence Community component, 
while ensuring that DHS maintains the vital link to its state 
and local partners, and also ensuring that as we work to 
protect the freedom and security of our homeland, we also 
continue to protect and preserve our civil liberties.
    The partnerships that you have engaged in have led to 
central communications links between the federal government and 
state, local, tribal and private sector officials. These links 
help to ensure that the men and women on the frontlines in the 
fight to protect our homeland have the essential information 
they need to help prevent another terrorist attack. I hope your 
testimony today will address how these links and partnerships 
are being strengthened and refined to help keep America safe.
    I welcome you, General Hughes, to the subcommittee today. I 
also want to thank you, as somebody who has also worn the 
uniform for, in my case, 37 years, 7 months, and 24 days, but 
who is counting. When you are having a good time, you do not 
count it all up. But I want to thank you for your very 
distinguished service to our country. I look forward to hearing 
your testimony.
    I would like now to recognizing the Ranking Minority Member 
of the subcommittee for any statement that she may wish to 
make.
    Ms. Lofgren. Thank you, Mr. Chairman. Thank you for calling 
this hearing to discuss the proposed fiscal year 2006 budget, 
building the information analysis capability of the Department 
of Homeland Security.
    Mr. Chairman, I look forward to working with you. I hope to 
be able to have a good, productive and professional 
relationship on this subcommittee, as I enjoyed in the last 
Congress with Chairman Thornberry. That was a very rewarding 
experience for me, and I think for Chairman Thornberry.
    We worked together as a team. We developed our hearings 
together. We decided our witnesses together. We wrote bills 
together. In the end of the Congress, we issued not a majority 
report and a minority report, but we issued one report from our 
committee. I hope that we will have that same level of success 
in standing up for our country and making sure that we are 
facing.
    General Hughes, I welcome you and I look forward to hearing 
your testimony, as we work with you as we seek to empower the 
critical exchange of information within the Department of 
Homeland Security. You have a difficult task, and I hope that 
the subcommittee will be able to help you as you work to 
enhance the department's capability to collect, aggregate, 
analyze and share information.
    I understand your office is responsible for four specific 
tasks: analyzing and mapping terrorism threat intelligence to 
vulnerabilities in the nation's critical infrastructure; 
sharing information with state and local governments and at 
times with the private sector on the public information 
concerning terrorist threats; meeting operational efforts 
regarding the homeland security advisory system; and providing 
intelligence analysis to senior DHS officials.
    As you may know, I served for 14 years on the Board of 
Supervisors for in Santa Clara County, so I have a very keen 
interest in how information is shared with local governments so 
that they can take appropriate action. I am also very 
interested in how we have assessed what is vulnerable so that 
we can effectively map the threats that we discover.
    Finally, I do not want to be a nag, but I am going to raise 
it anyhow. This is your first meeting before us and so I am 
going to cut a little slack to the department, but there is a 
Committee Rule, rule 11(j), that requires witnesses to have 
their statements to the committee in advance of the actual 
hearing. It is 48 hours that testimony is to be submitted, and 
we received your testimony just 4 hours ago.
    So this is not a senseless rule. I like to read the 
testimony before I come to a hearing and have the staff analyze 
it, and receiving it 4 hours in advance of a hearing just does 
not permit that. If we are going to do our job well, you need 
to help us by complying with that rule. So I hope I will never 
have to refer to that rule again, and I look forward to your 
testimony.
    Thank you, Mr. Chairman.
    Mr. Simmons. Thank you. That is a good and a useful comment 
to make.
    I would now like to recognize the Chairman of the full 
committee, the gentleman from California, Mr. Cox, who I just 
mentioned a few minutes ago has played an historic role, a 
truly historic role, in bringing about a full Committee on 
Homeland Security.
    I believe the reorganization of our government over the 
last several years is the largest reorganization we have 
encountered since World War II, with the National Security Act 
of 1947 and the creation of the Department of Defense. With 
that massive reorganization goes a requirement to oversee the 
Department of Homeland Security.
    Chairman Cox has been a critical component in making sure 
that the Congress lives up to its obligations in these 
difficult, historic times.
    Mr. Chairman?
    Mr. Cox. Thank you, Mr. Chairman.
    I want to begin by welcoming Chairman Simmons to this 
subcommittee. We are picking up the work that was carried on in 
the Select Committee on Homeland Security during the last 
Congress. I do not think there is any question that by 
background, Congressman Simmons is well suited to chair this 
subcommittee. I do not think there is any question either that 
Zoe Lofgren of California is very able and equipped to serve as 
our Ranking Member on this subcommittee.
    General Hughes, as you know, we have been on this 
committee, at least as it was constituted in the last Congress, 
aggressive supporters of your responsibilities in the 
Department of Homeland Security. Since the last Congress, we 
have enacted legislation creating a national Intelligence 
Director and creating the NCTC that will have profound impacts 
on the Information Analysis responsibility within the 
Department of Homeland Security.
    I note that this is not a packed hearing room and it is in 
some senses ironic because I do not believe we will ever focus 
on anything that is more central to the government's 
responsibility in protecting Americans from terrorism than what 
we are going to be talking about today. So to those of you are 
here, you are involved in a very important undertaking on 
behalf of our country.
    The Homeland Security Act of 2002 gave the department a new 
overriding counterterrorist mission that had not previously 
been the job of any part of the federal government. It sought 
to enable to department's success in this new mission through a 
Directorate of Information Analysis and Infrastructure 
Protection. The information analysis portion of that 
directorate is the intelligence piece overview with prevention, 
particularly when it comes to the eventual threat of terrorists 
armed with nuclear weapons, not dirty bombs, but real nuclear 
weapons, or terrorists armed with bio-weapons, particularly 
bio-engineered weapons that are designed to be resistant to 
antidotes and vaccines that we might have stockpiled. There can 
be no overstating the importance of prevention. That is what 
this is all about.
    During the Cold War, I think we understood that dealing 
with the response and recovery from a nuclear exchange was not 
plan A, plan B, or plan C. We were very much focused on 
avoiding that nuclear exchange. Likewise, the prospect that 
terrorists might apply weapons of mass destruction now or in 
the future has to cause us to focus enormous attention on 
prevention. That is what we hope, notwithstanding the passage 
of the 9/11 Commission Recommendations Implementation Act, we 
can continue to do under the legal mandate of the Homeland 
Security Act.
    The memorandum of understanding on information sharing of 
March 2003 was a truly unprecedented undertaking between the 
Attorney General, the Director of Central Intelligence, and the 
Secretary of Homeland Security. Its purpose is to move 
information along and through these three communities free of 
the longstanding constraints that existed prior. There are some 
signs that are less encouraging or convey a mixed message about 
our potential to achieve what we envisioned when we wrote the 
Homeland Security Act and in passing the law in 2002, and when 
this memorandum was agreed to in 2003.
    I hope today, General Hughes, that we have the opportunity 
to understand from you exactly where we are headed and whether 
we have the resources to get there.
    I thank you, Mr. Chairman.
    Mr. Simmons. I thank you for your comments.
    Now, the Chair would like to recognize the Ranking Member 
of the full committee, Mr. Thompson from Mississippi.
    Mr. Thompson. Thank you, Mr. Chairman. I am appreciative of 
you calling this hearing at this time. Even though we cannot 
discuss the numbers for this department in open session, I 
think there are some issues that we need to get on the table 
real quick for the sake of the public.
    I guess about 2 months ago, Ms. Lofgren and I had an 
opportunity to look at the vulnerabilities of our 
infrastructure by state. We were somewhat dismayed, Mr. 
Chairman, at how inconsistent that list was by state, and we 
are really concerned that somehow we have to have some 
standardization associated with that infrastructure list. As I 
understand it, there are some 85,000 vulnerabilities identified 
from miniature golf courses to shopping centers and what have 
you. But I am concerned about it, and I want to make sure that 
we address it this year so that we all, as members of this 
committee, can feel comfortable that those critical 
infrastructures in our districts clearly are being identified 
so that they can be protected.
    In addition to that, I am concerned about this information 
sharing across the board, whether or not we have satisfactorily 
changed the culture of the department so that they are actually 
talking to each other. We hear comments all along about 
departments being territorial with their information, and if we 
are indeed protecting the homeland. We ought to make sure that 
all those agencies involved in protecting us are communicating 
with each other. So I look forward to this hearing and many 
more around this subject. Obviously, I look forward to your 
testimony, General Hughes.
    Thank you very much.
    Mr. Simmons. I thank the gentleman for his comments. As 
somebody who worked for the CIA for 10 years, and then finally 
in military intelligence for over 30 years, sharing information 
is a hugely important issue. Security is important, but a 
perfectly secure piece of information which is not disseminated 
is of no use. So what we have to do is come up with a balancing 
act. We have to balance the needs for security with the needs 
for sharing so that we can better protect the American 
homeland. So that is a very good point.
    General Hughes, thank you again for coming before the 
subcommittee today. I will apologize to you in advance. I will 
have to vacate myself from the chair in a few moments to meet 
with the Secretary of the Navy in a prior commitment. I trust 
that our distinguished full committee Chairman will be able to 
carry on in my absence. I will be back as soon as possible. 
Thank you for being here today, and we look forward to hearing 
your testimony.

   STATEMENT OF LIEUTENANT GENERAL PATRICK HUGHES (RETIRED), 
     ACTING UNDER SECRETARY FOR INFORMATION ANALYSIS, AND 
    INFRASTRUCTURE PROTECTION, AND ASSISTANT SECRETARY FOR 
                      INFORMATION ANALYSIS

    Lieutenant General Hughes. Thank you very much. I am glad 
to be here today, too. I may have been the victim of a 
biological attack before coming here. I am a little ill.
    Mr. Simmons. Spread it around.
    Lieutenant General Hughes. I am trying not to. I hope you 
will forgive me if I have to cough or blow my nose or 
something. My apologies.
    I liked your opening comments very much. I, too, have worn 
a set of dog tags around for a long time, and have the same 
frame of reference. I note that this is quite different, 
however. I did not realize, I don't think, before I came to the 
Department of Homeland Security how different it is to come 
into my office in the morning and find myself examining a map 
of the United States and operating in the construct of our 
national values and civil liberties and rights of American 
citizens, as compared to the military application of force in 
an overseas environment. It is quite interesting to me, and has 
caused me to have to shift to some degree my mind set.
    I think I would like to apologize to the Congresswoman for 
the delay in our testimony getting here. I would merely say we 
did submit it on time, but the clearance process did not 
respond. We will do our best, though, and your point is not 
only well taken, but understood. So thank you very much.
    I believe from your comments and Ms. Lofgren's comments and 
others that I have to clear the air here. Otherwise, I will 
proceed in this hearing under false pretenses. My last day on 
this job will be March 15. You are speaking to someone who will 
not be carrying out for the most part many of the hopes and 
dreams that you have as a federal official, but in my future I 
will continue to support the Department of Homeland Security, 
and I will do everything I can to support the government in the 
future. I would just like you to know that, because it sounded 
like in your comments you did not know that, and you expected 
me to be continuing in this job. I hope that is not too much of 
a surprise to you.
    Mr. Simmons. Well, you are on the hot seat right now, so 
let's just keep you there until you disappear.
    Lieutenant General Hughes. That is fine. I am not trying to 
avoid anything. I merely want you to know my tenure here is 
relatively short. I would be glad to answer questions about 
that, if you would like me to include any ideas I might have 
about my replacement.
    The last comment I would like to make to you all is that I 
have lived through the last year and a few months with you. I 
have come before you on a few previous occasions formally and 
several times informally. I have appreciated every opportunity 
I have had to talk with you and interact with you. I can look 
you directly in the eye and tell you that we have made 
progress. We have made a lot of progress. In some cases, it is 
not smooth or very attractive, but it is real. We are 
continuing that progress. The dedication and devotion of the 
people who are carrying out the work of the Department of 
Homeland Security, if you have that in your mind, you can never 
be in doubt.
    We do require guidance and direction and we do require 
measuring and rating at times, and we do require a steward and 
admonition and wisdom from others. But the heart, the spirit, 
the devotion and the dedication to duty is present in all of 
those who serve in this department.
    Thank you very much. I will be happy to answer questions 
you ask.
    [The statement of Lieutenant General Hughes follows:]

                PREPARED STATEMENT OF PATRICK M. HUGHES

    Good morning Chairman Simmons, Congresswoman Lofgren and 
distinguished Members of the Committee. It is a pleasure to appear 
before you today to discuss the Information Analysis (IA) capability of 
the Department of Homeland Security (DHS). This time of year marks the 
two-year anniversary of the actual ``stand up'' of the Department. We 
have really been able to support the intelligence and information needs 
of the Department for about 13 months. As we transition much of the 
senior leadership of the Department and as we anticipate the arrival of 
our new Secretary, we clearly intend to work to improve our 
capabilities, but it is important to acknowledge the tremendous efforts 
of the many individuals who have worked tirelessly to bring together a 
functional and effective intelligence support organization. I want to 
specifically mention the extraordinary men and women of the Information 
Analysis and Information Protection Directorate (IAIP) with whom I am 
so proud to have served. These superb professionals, laboring often in 
the background, are focused on the business of the Department and the 
Nation because they are 100 percent committed to our mission and our 
Nation's security. Judging from the feedback I have personally 
received, and according to my professional judgment, we--they--are 
making a difference with our effort to provide accurate, timely, 
actionable, and cogent information to the customers we serve.
    It is also important to recognize the impressive strides made in 
the area of information sharing, collaboration and cooperation at the 
Federal level. We have worked hard to develop more robust and 
deliberate interaction with our Federal partners, particularly with the 
Federal Bureau of Investigation. Our joint efforts with the National 
Counterterrorism Center (NCTC), our relationships with DOD and the 
Central Intelligence Agency (CIA) and other key departments, such as 
Justice, State, and Energy, have greatly advanced our collective 
capabilities and relationships. Our current information sharing and 
collaboration environment within the government is far superior to that 
which existed before the establishment of DHS and has notably improved 
during the past year. We look forward to the advent of the Director of 
National Intelligence and continuing progress throughout the 
intelligence community.
    Our efforts to build a DHS intelligence capability are oriented 
around three overarching imperatives. These are: building and expanding 
capacity within the Department; furthering our coordination and liaison 
efforts with all of our stakeholders, domestic and foreign, government 
and non-government; and, creating and distributing the work products 
that will ensure we all have the right information, at the right time, 
in the right way. . . to protect and preserve. In short, we are doing 
our job supporting the Department of Homeland Security and in my view 
doing it well.
    As we evaluate and assess the roles and mission of the Office of 
Information Analysis (IA), I believe we must acknowledge IA's role 
within the broader construct of DHS. IA should be considered the Office 
of Intelligence for the Department. This essential function will 
include building out the intelligence infrastructure for DHS 
Headquarters and ensuring the establishment of common Intelligence 
Community (IC) standards that apply to the ``intelligence elements'' of 
the ``components'' of DHS. The 9/11 Commission Report specifically 
cited the continuing need to assimilate and analyze information from 
DHS' own components. IA needs to better integrate, coordinate, 
correlate and fuse these activities and the intelligence information 
they produce, in partnership with all component intelligence elements. 
IA, acting as the Departmental intelligence office, is developing a 
plan for the integration and collective application of all DHS 
component intelligence organizations in a way that will achieve greater 
synergy in this mission area. IA is and will continue to develop as the 
Departmental intelligence support element, while continuing to pursue 
its statutory obligations under the Homeland Security Act. As you know, 
IA is a part of the Intelligence Community and its funding is provided 
by the Intelligence Authorization Act, the specifics of which are 
classified. While I cannot go into classified specifics in this open 
forum, I am more than ready to discuss IA's budget with you in an 
appropriately classified session at your convenience.
    We have a dynamic vision of how intelligence and information will 
be analyzed, how the analytic elements of the Department will be 
managed to achieve optimum benefit, and how to develop a budgetary 
strategy that will unify the programs related to intelligence 
activities and information analysis across DHS. A major collaborative 
study is currently under way within the DHS to establish the baseline 
for this effort. In addition, we seek to reshape the Department's 
efforts consistent with the Intelligence Reform and Terrorism 
Prevention Act of 2004 (IRTPA) and the new authorities of the Director 
of National Intelligence (DNI).
    No less important is the need for adequate facilities, analysts, 
and program resources to assure that the complex and difficult process 
for obtaining and analyzing intelligence is managed, operated and 
sustained. It is not sufficient to simply create authorization for 
fully funded U.S. Government employees without also providing the 
resources to properly house these intelligence professionals in 
facilities that are designed and constructed to facilitate the receipt, 
handling, analysis, and storage of highly classified material in order 
to protect and preserve our security. To that end, the 2006 budget 
request includes $38 million to allow IAIP to fit out facilities that 
meet security and information technology requirements and allow IAIP to 
access and analyze intelligence, collaborate with our partners and 
execute the mission we have been given. IAIP came into the Department 
with no legacy facilities and no predetermined permanent housing. We 
now have a plan to occupy both swing and permanent facilities that fit 
our needs, and this funding request will enable us to complete that 
plan.
    As we work toward building IA's capability, we have framed our 
thinking around a new paradigm that seeks to encompass ``all 
information necessary to protect and preserve the homeland.'' Within 
that environment are subsets of information such as defense or military 
information, intelligence information, law enforcement information, 
homeland security information, and critical infrastructure information 
as well as public and private sector information. All of these types of 
information make up the vast array of intelligence that DHS needs to do 
its job.
    DHS is a fully vested member of the IC and the Office of the 
Assistant Secretary for Information Analysis represents the Department 
in all IC venues, ensuring that DHS interests and requirements are 
fully represented and considered among the community. IA analysts have 
access to the most sensitive national intelligence regarding 
international and domestic terrorist threats, and the interaction with 
their peers throughout the IC continues to develop and improve. Much of 
the information we receive comes to us from IA analysts' connections to 
the Joint Worldwide Intelligence Communications Systems (JWICS), NCTC 
Online, the IA Automated Message Handling System (AMHS), the Homeland 
Security Information Network (HSIN), the Open Source Information System 
(OSIS), and a variety of other formal and informal (i.e., analyst-to-
analyst) mechanisms. These information streams from external sources 
are augmented by our own internal reporting from DHS components. We are 
increasingly well informed, but not yet satisfied with this endeavor.
    The range of intelligence and information coordinated by IA from 
the IC, and our state, local, tribal, municipal and private sector 
partners; as well as from all DHS entities with intelligence and 
operational capabilities, is both impressive and daunting. These 
entities--and their products--continue to be an important part of how 
IA does its work.
    IA's relationship with our colleagues in the Infrastructure 
Protection (IP) Directorate is critical to our success. Jointly we are 
able to deliver threat-informed vulnerability analysis and data-
supported risk assessments regarding our critical infrastructure to our 
constituents and customers--notably the private sector, which owns the 
vast majority of our nation's critical infrastructure.
    IA is an integral part of the Homeland Security Operations Center 
(HSOC) effort to monitor and communicate on all matters of homeland 
security interest 24x7. Intelligence from DHS components that IA 
correlates and analyzes provides invaluable perspectives and insight 
for the entire Federal government. From a citizen providing a Patriot 
Report on suspicious activity, to Border and Transportation Security 
(BTS) reports regarding individuals of interest trying to enter the 
United States illegally, or US Coast Guard reports regarding suspicious 
activity near critical infrastructure. Such information is provided to 
IA through the same methods the larger IC uses: the physical presence 
of DHS component and IC element liaison officers within both IA and the 
Homeland Security Operations Center (HSOC), strong linkage between the 
HSOC and our constituents, and communication between analysts and 
leadership. In fact, the presence of representatives of 30 separate 
Federal and local representatives within the HSOC provides a 
perspective and collaboration capability that is virtually unique. 
Additionally, coordination within DHS is aided by regular meetings of 
the intelligence chiefs of each entity, led by the Assistant Secretary 
for Information Analysis.
    It is not sufficient to just produce information. In order to be 
effective, information must be shared. DHS has developed this 
capability and in cooperation with our Federal partners and is 
coordinating information sharing among previously unconnected systems. 
For example, DHS has collaborated with the Justice Department on the 
DOJ Law Enforcement Sharing Plan. Further, the Homeland Security 
Information Network (HSIN) is a ``system of systems'' that provides 
discrete communities of interest for Law Enforcement, Counter 
Terrorism, Analysts, Emergency Management, and Critical Infrastructure 
groups to collaborate and share critical information in real time. In 
addition, the DHS network provides the ability to pull together 
participants from all of these communities, into a shared space to 
collaborate, during any period when the threat creates the need. 
Further, as a direct result of the Department's Information Sharing and 
Collaboration (ISC) initiative to cooperate and work jointly with other 
Federal partners, DHS and DOJ/FBI have established the first ever 
capability to share information between our respective communications 
and automation networks. Specifically, we were able to connect the 
Homeland Security Information Network with the Regional Information 
Sharing Systems (RISS) and Law Enforcement Online (LEO). More needs to 
be achieved but we are on the right track
    Already, the DHS ISC Program has engaged other Federal, State, 
local, and Tribal, information sharing programs in an effort to create 
synergy by fostering mutual awareness of their key programs and 
capabilities, and creating a forum to garner feedback on policies and 
procedures under development at the Federal level. Additionally, this 
effort has resulted in the first ever capability to share information 
among the State, local, and tribal information sharing systems.
    IAIP's fiscal year 2006 budget request includes $7,482,000 for ISC. 
The Department is budgeting an additional $5,000,000 from the Chief 
Information Officer and $4,000,000 from the Working Capital Fund to 
bring the total funding for ISC in fiscal year 2006 to $16,482,000.
    In addition to receiving information from these entities, IA is 
routinely sharing information and collaborating at all levels--from the 
Federal Government and the IC to State and local officials. DHS 
component organizations also serve as a conduit through which 
information and warnings can pass to government at all levels. Thus, 
IA's continuous information sharing and collaboration with the HSOC, 
BTS, USCG, and other DHS entities, provides valuable information to all 
of the men and women responsible for protecting the homeland.
    It is IA's specific focus on the protection of the American 
homeland against terrorist attack that is unique among its IC partners. 
This focus provides invaluable information and assistance not only to 
State, territorial, tribal, local, and private sector officials that 
receive accumulated threat information, but also to DHS components that 
use the information, trends, and indicators to inform and prepare 
operators and decision makers on the front line. The relationship IA 
has with the HSOC, BTS, and other DHS entities translates into 
continuous information sharing and collaboration that provides a unique 
threat picture and actionable information to those who are vital to 
protecting the homeland.
    The Department of Homeland Security is a prime example of how 
changes have been made within the Intelligence Community, the 
counterterrorism community, the law enforcement community and the 
response community to work more cohesively as well as more 
collaboratively, and to assure information is shared as fully and 
completely as possible. This represents a dramatic change from 
conditions as they existed before September 11th, 2001 and an very 
impressive change from even one year ago. DHS plays a central role in 
the counter-terrorism and homeland security effort as we continue the 
work of communicating intelligence and information to our partners in 
the federal government as well as with the State, territorial, tribal, 
local, major city and private sector officials charged with protecting 
the people and infrastructure of the United States.
    We are proud of our work and our place in the larger national 
defensive network and we look forward to a safe and secure future for 
our nation. Mr. Chairman and Members of the Committee, this concludes 
my prepared statement. I would be happy to answer any questions you may 
have at this time.

    Mr. Simmons. I thank you for your testimony. What we will 
do is I will ask a question and then I will go to my left and 
right by order of appearance at the time of the gavel and 
thereafter, after of course our Chairman and Ranking Member 
have had their opportunities.
    I commanded a military intelligence unit in the mid-1990s 
that created a handbook for open source intelligence that was 
eventually adopted by the U.S. Army as doctrine. I have had a 
personal interest in open source intelligence ever since. I 
have traveled to Special Operations Command in my capacity as a 
member of the Armed Services Committee. I have gone to open 
source conferences. I have met with officials from around the 
world who have an interest in this capability.
    It seems to me that open source acquisition or open source 
intelligence, that is intelligence that is created from the 
collection and analysis of open sources of information, lends 
itself particularly to the intelligence challenges of the 
Department of Homeland Security for two reasons. One, in some 
respects the information that we are relying on or looking for 
may come from that small municipal county sheriff's department, 
for all we know. It needs to be transmitted quickly, and it 
does not need to be classified in and of itself. Two, products 
that are derived from open source acquisition and analysis 
often do not have to have the same level of classification as 
those that are collected through other venues, so it is more 
readily available to share with the American people.
    Cost is also a factor. Where are we in the development of 
this capability in support of the mission of the Department of 
Homeland Security, and where would you like to see us go?
    Lieutenant General Hughes. We have explored a number of 
avenues with regard to open source information. I have been a 
proponent of it for a long period of time. I have to tell you 
that I have discovered along the pathway that I have taken, 
anyway, that there are some problems with it. A lot of 
information from open sources, much of it is erroneous, wrong. 
When we use it exclusively without cross-checking it with 
something else, we have found, I have found, it has been my 
experience, that it usually gets us in trouble.
    So I think while I think there is great power in this 
source of information, I also think we need to tread carefully 
in using it, and understand the context in which it can be 
used. We have on our computers now in the IA element the OSIS. 
It stands for the Open Source Intelligence System that the 
intelligence community is the proponent for and now provides 
numerous search engines, databases, media files, download 
capabilities of all kinds, including photographs, pictures of 
the ambient culture and environment around the world. We have 
all that at our fingertips right now. We have had guest 
speakers on this topic we have tried to inculcate in the 
homeland security intelligence analysis the power of, the idea 
of open source intelligence.
    I do not know whether you are familiar with a gentleman 
named Robert Steele.
    Mr. Simmons. I am intimately familiar.
    Lieutenant General Hughes. Okay.
    Mr. Simmons. I think you know what that means.
    [Laughter.]
    Lieutenant General Hughes. Yes, I do. I do. Robert Steele, 
for all of his many interesting characteristics, has been 
something of a pioneer in this field. We have had him come and 
talk to us. It was a very interesting talk and very 
deliberative and engendered a lot of discussion. I think that 
with Robert Steele's views as something on the far end of the 
utility spectrum, you may think of never using open source 
information as the other end of that spectrum. We are trying to 
find utility and balance along that spectrum.
    Once again, I think it has great potential and we are very 
knowledgeable about it and using it.
    Mr. Simmons. Thank you for that response.
    I would like to recognize the gentlewoman from California, 
Ms. Lofgren.
    Ms. Lofgren. Thank you very much.
    I am concerned about the number of contractors that are in 
the department, instead of full-time employees, not just in IA, 
but throughout the department. One question I have, without 
getting into the numbers, which we cannot, is whether you are 
confident that we have sufficient budget authority to actually 
have staff, as opposed to contractors, in the upcoming fiscal 
year.
    Lieutenant General Hughes. Yes, ma'am. I believe that the 
budget authority is not in question here. Finding the expertise 
is a problem. And accompanying this, to the best of my ability 
to characterize the truth here, it is true that the contractors 
have offered us and we have taken advantage of their offer, 
some very fine people with some tremendous technical expertise 
that we were not able to acquire in any other way.
    Back to the fiscal realities of this, those people are 
costing us more money than a federal employee would. However, 
you cannot get them. We have not been able to get them by 
hiring them off the street. They are a limited supply and high 
demand.
    Ms. Lofgren. I know we cannot go into the numbers in this 
open session, but I would be interested in a secure setting to 
take a look at where that balance is so we can get a handle. I 
know in some of the other aspects of DHS, I have a better 
handle on the contractor-to-employee ratio and how it is 
working. I would like to do that if I could arrange that with 
you.
    Lieutenant General Hughes. I would be happy to do it. In 
lieu of reading, which might take a longer time, I can get an 
information paper back to you that has the details at either 
the unclassified level or at the level of classification that 
we have.
    Ms. Lofgren. Why don't you do that, and then if I have 
further questions, we can follow up further.
    Lieutenant General Hughes. I am happy to do so.
    Ms. Lofgren. I appreciate that.
    In thinking about the task that you face, is it fair to say 
that the largest part of the IA job is to map the intelligence 
collected by other agencies to the critical infrastructure 
information maintained by IP? If that is the case, I am 
wondering what influence you have, if any, on the state of the 
critical infrastructure listing and analysis, and how much that 
is impairing your task?
    Lieutenant General Hughes. First, the answer to the first 
part of your question, is that our primary or most critical 
function, my answer to that, I am sorry to say, is no. Our 
primary task and our most critical function has become, and I 
think it is logical for this to happen, departmental support 
across the board, working as an all-source intelligence 
producer for the department. That is really our work in its 
primary form.
    The most important part of that work is to continue that 
interface between IA, the intelligence part, and IT that does 
the risk analysis and vulnerability assessment, but I will have 
to tell you that it is a little bit hard for all of us to 
understand, the risk analysis and vulnerability assessments are 
not done strictly on the basis of threat. They are done with 
civil characteristics in mind. One of them is apparent 
vulnerability to possible attack using means of attack. Another 
idea that is applied here is whether or not a particular kind 
of infrastructure has proven to be attackable if gaps are not 
closed and if vulnerabilities are not reduced.
    Another idea behind it is the value of the infrastructure, 
whether it has ever been attacked or not. That is kind of a 
strategic assessment. As an example, I think Mr. Thompson 
mentioned miniature golf courses or something like that. 
Obviously, when you are using good common sense, not high-
faluting intelligence, and you are weighting the importance of 
a miniature golf course against a nuclear storage site, 
hopefully most people would choose the nuclear storage site. 
That does not mean, however, that something in between those 
two extremes does not need some kind of protection.
    Ms. Lofgren. I know my time is up, but the concern I had 
with the latter question is that in fact the miniature golf 
site is on the list and the nuclear power plant is not. So if 
part of your job is to map the threats to the listing of the 
critical infrastructure, and the critical infrastructure is 
just random, how do you do that job?
    Lieutenant General Hughes. That should not be the case. I 
am not familiar with the specific part of the list that you are 
telling me the nuclear power plan is not on there, but let's 
suppose that that is accurate. That is a mistake and we need to 
fix that.
    Ms. Lofgren. Okay. Thank you.
    Lieutenant General Hughes. You are welcome.
    Mr. Cox. [Presiding.] General, I would like to go into some 
of the numbers in this open session, and I do not see any 
reason that we cannot discuss the programmatic figures here. My 
understanding with staff is that these are all open. I would 
like to talk about threat determination and assessment, 
evaluation and studies, the homeland security operations 
center, and the new account for information sharing and 
collaboration.
    I wonder if, just to set the stage for discussion of this, 
if you could describe for the subcommittee what each of these 
programs is in chief focused upon, starting with TDA.
    Lieutenant General Hughes. I hope I can do this right, but 
it is not a classification issue. It is a knowledge issue, so I 
am going to have to refer to a book. The first one you wanted 
to talk about, sir, was?
    Mr. Cox. Threat determination and assessment. Do you know 
what I can do also, I mean, we are sort of constrained to go 
through this program by program in order to talk about it in 
this open session, but I would like to get into what is the nub 
of your work. The figures that I have before me include the 
programs for threat determination and assessment, evaluation 
and studies, homeland security operations center, and 
information sharing and collaboration. I wonder if you could 
begin with whichever of these is closest to the core function 
of IA to do all source intelligence fusions?
    Lieutenant General Hughes. Obviously, threat determination 
and analysis is a primary factor. I am not sure exactly what 
you want to know, but if you want to know if our budget is 
adequate, the answer I believe is yes.
    Mr. Cox. To the extent that threat determination and 
assessment is central to your mission, it would disturb me, 
then, that we are cutting its budget.
    Lieutenant General Hughes. I do not know if you should be 
disturbed about that, sir. We are not cutting it too much. The 
issue here is the threat determination, after you initially 
make it on a piece of fixed infrastructure, does not really 
need too much work after that if nothing changes. So once you 
lay down a baseline, you may not need quite the same level of 
effort that you did in the past. You do not have to re-do that 
baseline.
    Mr. Cox. Over time, we have been working with the 
department and with you directly to make sure that you acquire 
the number and quality of analysts necessary to perform IA's 
function. To what extent do these programmatic figures for TDA, 
for evaluation and studies, for the operations center and for 
information sharing and collaboration reflect the number of 
analysts that you have at your disposal?
    Lieutenant General Hughes. In the case of the operations 
center, there is no parallel at all. The operations center 
generally has people in it who are doing what I would refer to 
as information transfer. They are getting information in from 
any source at all. They do not analyze the information. They 
put it in the right bins. They alert people to the fact of the 
information. They pass it to others. They do any analytic 
endeavor.
    Mr. Cox. I note that the operations center is getting a big 
plus-up of, it looks to eyeball it, of about 40 percent. 
Likewise, evaluation and studies is getting a healthy increase. 
The threat determination and assessment account, on the other 
hand, is being reduced, and the explanation that has been 
provided to committee staff is that it is due in large part to 
a decrease in purchasing from government accounts and a 
decrease in advisory services needed for this account.
    To be perfectly honest with you, I do not have any idea 
what that means. So I do not know whether or not I need to be 
concerned. I know what our chief programmatic concerns are, and 
that is that we continue to help you build a core of talented 
analysts who can carry the full statutory mission forward of 
all source intelligence analysis, and make sure that even post-
9/11 Act, that the Homeland Security Department is a major 
participant in the intelligence community at the NCTC.
    Lieutenant General Hughes. I think your concern is well 
founded. If I could try it from a macro level, our overall 
budget I think is about 2 percent reduced, but money has been 
shifted around inside the structure of the IAIP to meet needs 
that we believe are present. Part of the plus-up in the HSOC is 
to handle COOP requirements and to meet the needs of the 
information flow that we anticipate is going to come into the 
department from greater feeding of information. This is raw 
information from the state and local sectors. In other words, 
we think after fielding homeland security information network, 
and that is JRIES with a new name on it, and after upgrading it 
to the secret level, we will be getting a lot more raw 
information.
    Handling that, processing it, is part of the plus-up that 
you see there. The idea of whether or not I can characterize 
what this set of words or phrases means exactly is kind of a 
mystery to me, too. In fact, I do not know if I could explain 
it. But I think the idea here is to get the information into 
not only the operational channel, but the intelligence channel 
for analysis concurrently. Lots of information that comes, 
especially the state and local and private sector, does not 
require much analysis in its initial form. It is a spot report, 
a patriot report, a person's call-in of suspicious activity.
    That may indeed be a piece of information that has to be 
put into the analytic environment, but standing alone it can 
also be passed to operators and actors for their initial 
appraisal of the information. To use the phrase, the phrase has 
become so unpopular, to connect the dots, the connection of the 
dots still goes on, but it kind of rests in the background for 
some of this information. The foreground is the initial use of 
the information in an operational setting, but we have shifted 
money around to do that.
    Mr. Cox. My time has expired.
    The gentleman from Mississippi, the Ranking Member of the 
full committee, Mr. Thompson.
    Mr. Thompson. Thank you, Mr. Cox.
    General Hughes, can you provide this committee with a 
breakdown of those contractor services that we are paying for 
over and above normal personnel costs, as information that you 
get back to us? You do not have to comment on it. Just provide 
to us.
    Lieutenant General Hughes. Yes, sir.
    Mr. Thompson. To your knowledge, are you aware of any 
problems with any of those contracting services as of this 
date?
    Lieutenant General Hughes. I am aware of some problems.
    Mr. Thompson. You are?
    Lieutenant General Hughes. Yes.
    Mr. Thompson. Can you also provide this committee with a 
listing of those problems?
    Lieutenant General Hughes. I will.
    Mr. Thompson. Thank you.
    With respect to the mapping the threat to vulnerabilities, 
what is your opinion of those vulnerabilities that have been 
identified, just in general? Do you think in your opinion those 
vulnerabilities meet the test of mapping? Do you think it is 50 
percent complete? Just give me your honest opinion of it.
    Lieutenant General Hughes. My honest opinion is that we are 
far from finished. Indeed, we are now using a term called 
``complex urban environment.'' We are treating the major cities 
especially, but also the industrial outliers and some other 
parts of the United States that have a concentration of 
activity that is of interest to us, and we believe it might be 
of interest to the terrorists, as an organism, so that if you 
kick the shin of a large complex city, the city may also get a 
headache at the same time as the shin hurt, because the thing 
is so interconnected. It is very much like an animal or a 
human. The nervous system of the city may indeed be affected by 
a kinetic blow. That is an important concept. I know it sounds 
a little ethereal, perhaps, but it is not. It is a fact.
    So probably the most common example of this is the 
electricity. You turn off the electricity, you turn off a lot 
of capability. If you turn the electricity off for a short 
period of time, you can live with it, not a problem. If you 
turn it off hard for a long period of time, we would have 
difficulty performing some of the functions we now take for 
granted.
    So that is an example. The electricity itself is what you 
have to attack in order to do that, or the control mechanisms 
associated with it. That fact, that idea that a hospital, as an 
example, when it runs out of fuel and its alternate power 
source does not operate anymore, and the electricity is still 
off, means that that is a vulnerability you have to assess 
carefully.
    If you did not assess it properly and have enough vision to 
see that after 3 days you were going to run out of fuel, there 
may not be a way to get more fuel because the pumps at the fuel 
station do not work because the electricity is off.
    Mr. Thompson. Okay.
    Lieutenant General Hughes. More than you wanted to know 
about it.
    Mr. Thompson. Well, I just want to know if we identified 
the hospital as a potential target.
    Lieutenant General Hughes. Absolutely.
    Mr. Thompson. Yes, okay. With respect to your present 
position, have you any access to all intelligence available?
    Lieutenant General Hughes. Yes, I have, but I have to tell 
you that not everyone who works for me has.
    Mr. Thompson. What was the problem with others not having 
access to that information?
    Lieutenant General Hughes. There is in the intelligence 
committee, it remains to this day, a culture in which a known 
person with a certain track record, having been polygraphed and 
background investigations done repeatedly over time, and a 
certain amount of dependability built into that background, and 
perhaps maybe you could even call it familiarization, the old-
boy network, that culture has something to do with what level 
of trust and confidence others are willing to place in you.
    Mr. Thompson. Mr. Chairman, if I could. So if Congress 
passes an Act mandating agencies to share information, do I 
understand you to say that that is still subject to whether or 
not certain individuals want to share that information with 
other agencies?
    Lieutenant General Hughes. I probably would not put it 
quite like that. It is subject to the rules governing the 
information itself and who has access to it for what reasons.
    Mr. Thompson. Mr. Chairman, I guess my point is, if we pass 
an Act saying that these agencies have to share this 
information between them, I am now hearing that there is some 
other standard out there somewhere that prevents that 
information being shared.
    Lieutenant General Hughes. Let me just tell you, if I may 
respond to this, this always has been in the intelligence 
business in the government, something called the ``need to 
know.'' The ``need to know'' rule still applies, and for the 
most sensitive kinds of intelligence, about very specific 
activities, the ``need to know'' rule still is at work.
    My personal view, by the way, is it should be. You should 
not tell everyone every single thing every single day. You 
should make sure that the key persons who are involved in this 
work know the essential issues each and every day, and I 
believe that has been done in my case.
    Mr. Thompson. Well, I think we will probably have some more 
opportunities for discussion. Thank you.
    Mr. King. [Presiding.] All right, Mr. Thompson.
    General Hughes, let me thank you for your service, and I 
certainly wish you well after March 15.
    In a way, I will be following up on Congressman Thompson's 
question, or maybe expanding it a bit. Obviously, information 
analysis is a work in progress. You have described it that way 
yourself.
    How has the passage of the Intelligence Reform Act impacted 
on that, either positively or adversely? Do you feel that the 
sharing is working the way it should? Is it better than it was 
before? Do you feel constricted? Again, how does it impact on 
the Department of Homeland Security?
    Lieutenant General Hughes. The first part of the answer is 
it is a lot better than it was.
    Mr. King. Because of the legislation being passed, or just 
because of the evolving of time?
    Lieutenant General Hughes. To be very frank, sir, I have 
not personally seen or observed any change since the act was 
passed that could be attributed directly to the act. Any of the 
changes that have occurred were ongoing prior to the act being 
passed. The act is going to take some time to reach fruition, 
to have impact.
    I think it is a very good act. I fully support it. I think 
the advent of a Director of national Intelligence is an 
important piece of that act and will cause the sharing 
function, the interoperability and commonality among the 
information systems to occur so that sharing can be better 
facilitated, and numerous other functions that we all think are 
laudatory. That will happen. It is ongoing, and much of it was 
ongoing before the act was passed. That is just a fact.
    Over time, since September 11, I have seen a marked 
improvement. Indeed, in the past year, as I stated in my 
written testimony, there has been a distinct qualitative and 
quantitative improvement in the information that is being 
shared in the intelligence community. By the way, 
parenthetically, in what can be distinguished from the 
intelligence community, is the law enforcement community, which 
as we all know is the nexus that makes Americans nervous, but 
it is a nexus that has to occur in the battle against terrorism 
and the battle against destabilizing forces inside our culture. 
So that is working. We have a much better information 
relationship than we ever did with the FBI. Actually, it is 
improving right along. Every few days, we make some kind of 
improvement.
    Is it perfect? Is it everything we could wish for? No. But 
the improvement is so dramatic that I am loath to criticize it 
in any way. I am happy to characterize it as something that we 
ought to keep going.
    Mr. King. I have to ask you, is there anyone that you are 
willing to criticize? Are there any elements within the 
intelligence community, the law enforcement agencies, who you 
feel are not cooperating with the spirit of the post-9/11 world 
that we live in?
    Lieutenant General Hughes. I am not willing to criticize 
them.
    Mr. King. Could you question them? Could you enlighten us 
as to perhaps areas we should be looking at, where there is not 
full cooperation being given?
    Lieutenant General Hughes. I think you ought to do what you 
are doing now, which is continuing to press the entire 
intelligence community and the culture to the degree they 
possibly can to have broad and full information sharing. Just 
continue the pressure. It is working. I, for one, ascribe that 
success not to the practitioners of intelligence, but to you, 
the Congress. You have brought pressure to bear, and I thank 
you for it.
    Mr. King. If we were in closed session, could you direct us 
as to where we should apply more pressure, you know, in one 
place rather than another?
    Lieutenant General Hughes. No. I do not think so. I think I 
have given you an honest answer today.
    Mr. King. Okay. Also in your opening statement when you 
mentioned the fact that you would be leaving on March 15, you 
sort of enticed us with a statement that if we have any 
questions to ask you about suggestions that you might want to 
make, we should ask them.
    Let me ask you: Do you have any suggestions as to the 
future, regarding the department or regarding your specific 
position?
    Lieutenant General Hughes. I hope we can continue this 
work, strengthen it. We need the support of Congress and 
obviously we need the support of this committee and the 
subcommittees of the committee that are named after the work of 
securing the homeland. You need to be first for effectiveness, 
change, progress in the future here on the Hill. You also need 
to be our advocate to some degree.
    I certainly make a plea for that to continue. My view is 
that we did not have the same kind of supporting mechanism in 
Congress when we first started out at the so-called ``legacy'' 
or older agencies and departments did have. We are slowly 
building that. I see the permanence of this committee finally 
recognized, I think a year late at least, as a manifestation of 
that. I cannot see how you could view it any differently.
    Mr. King. Thank you, General.
    The gentleman from North Carolina, Mr. Etheridge.
    Mr. Etheridge. Thank you, Mr. Chairman. Let me join my 
colleagues and thank you for holding this hearing.
    General Hughes, thank you for being here. We are going to 
miss you.
    Lieutenant General Hughes. Thank you, sir.
    Mr. Etheridge. I wish you all the best.
    My State of North Carolina is a participant in the regional 
information sharing system or the RISS program. My question is, 
what is the status of linking the homeland security information 
network to RISS? How do you propose that we avoid duplication 
and confusion when we try to make these linkages so they will 
work best for the American people?
    Lieutenant General Hughes. RISS and LEO, the law 
enforcement side of that, can link now to JRIES. The names kind 
of run together here, but the homeland security information 
network is being empowered right now by the JRIES system which 
was an old Department of Defense system. That system was 
brought over to the Department of Homeland Security and put in 
place. Most people who have looked at it think it is an 
effective and efficient system. RISS and LEO both were able to 
link to it. It is not really hard to do.
    However, I believe that what we should have is a narrowing 
down of these systems and maybe even one system with one name, 
which can then be managed technically by one organizational 
entity. That is what I would like to see. That has proven to be 
an unpopular idea because of the investment that has been made 
in each of these separate systems. There are others besides 
RISS and LEO and JRIES out there.
    So I think another year or so of maturity and perhaps field 
evaluation may show, I am hoping it will show, that the power 
of combining these systems should be facilitated as rapidly as 
possible.
    Mr. Etheridge. General, let me follow that up, because it 
seems to me if we can get to that, and the sooner the better, 
because we save not only time, but we will save money. My 
personal view it would be a lot more effective for the American 
people and for those who use it. Would you agree or disagree 
with that statement?
    Lieutenant General Hughes. I completely agree.
    Mr. Etheridge. Is there some way, then, that this committee 
can help facilitate that movement and the maturity of that 
system?
    Lieutenant General Hughes. I think you can. I would like to 
invite you to have the proponents of the homeland security 
information network come here before this committee and give 
you their views and RISS and LEO also and others. I think that 
would be an excellent thing for you to do.
    Mr. Etheridge. Thank you, sir. I will encourage the 
leadership to take a look at that at some point. I think that 
is real cost savings, and would be very effective for the 
American people.
    I understand that DHS is attempting to provide useful 
intelligence to state and local first responders. How does IA 
handle the raw data and reports that you get from state and 
local officials coming in from the local?
    For example, what is the procedure for a police officer to 
report a suspicious activity that they may find, or any law 
enforcement officer, that ultimately could be used that may 
very well forestall a major problem that Homeland Security is 
responsible for?
    Lieutenant General Hughes. Right now, a police officer or a 
police organization will make a report through law enforcement 
channels to the Federal Bureau of Investigation, and either 
concurrently or separately to the Department of Homeland 
Security. These reports can be made verbally by telephone, or 
in some cases by the RISS network or the LEO network or some 
other way, a lot of which are terminated at the Homeland 
Security operations center.
    So the FBI gets them and we get them, generally speaking. 
There are cases where we have heard about, where reports do not 
come concurrently to one or the other. Usually, the report 
usually goes to the FBI first, and does not come to the 
Department of Homeland Security as a matter of routine. We are 
pressing to fix that by, first, advertising our role in the law 
enforcement community and asking them to follow this procedure.
    I might add that we have begun in the past year, and we now 
have something over 300 reports that are jointly filed with the 
Federal Bureau of Investigation. Those reports carry a message 
with them in the body of the report that says if you have any 
further information, or if you have any indication of activity 
associated with this report or in any other way, please report 
it to your local joint terrorism task force and the homeland 
security operations center.
    Mr. Etheridge. Thank you, General. I see my time has 
expired.
    It seems like this is another area that we could press a 
little more on, because if the FBI is not sending that 
information over, and it is not being shared, that is not what 
we had in mind when we set up Homeland Security.
    Lieutenant General Hughes. The FBI, I need to add this, I 
hope I did not characterize this wrongly, the FBI is not a 
problem in this regard. The FBI, at least as far as I know, is 
not preventing information from coming to the Department of 
Homeland Security. The local police, the law enforcement 
authorities out in the states and localities, sometimes do not 
report that information concurrently. But when the FBI gets it, 
in most cases they pass it to us, and we do the same.
    Mr. Etheridge. Thank you for that clarification.
    Thank you, Mr. Chairman.
    Mr. King. The gentleman from Pennsylvania, Mr. Dent.
    Mr. Dent. Thank you, Mr. Chairman.
    General thank you for your service.
    My question deals with the credibility of threats. 
Obviously, the 9/11 report talked a lot about the need to know 
versus need to share, and how do you strike that proper 
balance. When information, before it is going to be shared, 
obviously you have to determine whether it is credible. What is 
the process for determining the credibility of these types of 
threats before you can disseminate that information out in a 
timely manner to the people who need to know?
    Lieutenant General Hughes. That is a wonderful question 
because we live each and every day, and it is what I would 
refer to as Hobson choice.
    Mr. Dent. A what?
    Lieutenant General Hughes. A Hobson choice--a ``damned if 
you do, damned if you don't'' kind of choice. If we send 
information that we get out rapidly without taking some time 
with it, it is apt to be wrong. But if we take some time to 
clarify it, too much time, it loses its importance and its 
value over time. We never know. We cannot know whether it is 
accurate or not immediately.
    So our choice has been to report it as rapidly as we can, 
knowing that that is going to lead to much information going 
out in the field which is wrong. We know that, but we are 
hoping that all the professionals that receive this information 
will somehow understand that and be able to live with it.
    Mr. Dent. Just to follow up, we spend a lot of time around 
here trying to determine answers to questions, and thank you 
for your service.
    Lieutenant General Hughes. Thank you very much.
    Mr. King. The gentleman from Rhode Island is recognized, 
Mr. Langevin.
    Mr. Langevin. Thank you, Mr. Chairman.
    General I want to thank you for being here and for your 
testimony. Thank you for your service to the country, 
particularly in your latest role at the Department of Homeland 
Security. You have made a great contribution.
    Lieutenant General Hughes. Thank you.
    Mr. Langevin. If I could just begin with IA's role in the 
intelligence community. The Senate report on the intelligence 
leading up to Iraq brought to light a tendency toward group-
think. The information basically stressed the worst-case 
scenario, and a failure to question assumptions, if you will.
    The question I have is, has IA institutionalized measures 
to ensure that a similar type of intelligence failure does not 
occur here, and if so, what measures are in place and are they 
effective?
    Second, there is a truism in the intelligence business that 
to get included in the right meetings, that you have to be able 
to bring something to the table. So what products or expertise 
does IA currently bring to the rest of the intelligence 
community such that it is seen as a valuable contributor to the 
intelligence process?
    Lieutenant General Hughes. Thank you very much.
    In the first case, we think there is a problem consistently 
over time in the intelligence building, and you have to guard 
against it at all times. One of the things that it is up to 
leaders to do is to develop an environment in which any 
question could be asked, any premise can be challenged, any 
idea can be called to account. We just have to do that. We have 
to tell people the truth as directly and as clearly as 
possible.
    I would place the burden for avoiding group-think not on a 
process or procedure, but on leaders, specifically the leaders 
in the intelligence community, not merely at the highest level, 
and I would certainly hold them accountable, but also down to 
the mid-grade, middle-management level. They have to let 
analysts reign in their intellectual space and be able to think 
beyond some kind of artificial limit, to be able to deal in 
concepts in their own context without some kind of constraint 
or restriction.
    If we do not have that kind of environment in the 
intelligence community, then group-think will absolutely occur, 
you can depend upon it. I had a friend when I was in the 
military, an Israeli intelligence general. He happened to be a 
lieutenant colonel at the time of the 1973 invasion by the 
Egyptians across the Suez Canal. A captain came to him and 
said, those Egyptians are testing us each and every time we 
carry out war games, and we are not doing anything about it. 
The lieutenant colonel said, they are just war games. The 
captain said, they are not just war games; they are practicing. 
One of these days, they are going to continue. You know the 
rest of the story.
    The lieutenant colonel later regretted his failure in this 
function, and the picture of the dead from the front there was 
an intelligence analyst with chains and a big heavy locks 
around his head. That is the issue. We just have to somehow 
generate an environment that never allows that to happen in the 
United States.
    Mr. Langevin. General, if I could be clear in the 
understanding that you in particular in your department have 
things in place to make sure that consciously you have made 
sure that group-think is not going to be a problem?
    Lieutenant General Hughes. I have done the best I could to 
generate an environment in which any idea is welcome, any 
thought is fine. At some point, however, decision-makers have 
to make decisions. If your decisions over time prove to be 
flawed or faulty, then you obviously have a problem.
    The second part of your question, would you repeat it?
    Mr. Langevin. I want to know if it is true that in the 
intelligence business, to get included at the right meetings, 
you have to bring something to the table. So I wanted to ask 
what IA currently brings to the rest of the intelligence 
community such that you are seen as a valuable contributor to 
the intelligence process.
    Lieutenant General Hughes. I think that is right, that you 
do have to contribute. I think we are beginning to contribute 
something that is somewhat unique. I refer to it as domestic 
information. In the situation here in the United States, we are 
in partnership with the FBI that involves the concept of law 
enforcement information and intelligence all together to inform 
decision-makers and responsible parties about the context in 
which things are happening, and about potential events. This is 
not spying on the American people in any way, but it is 
understanding that there are persons inside our society and 
coming towards us who would do us great harm. We have to know 
where those people are, who they are, what their capabilities 
are, and what the potentialities are.
    The Department of Homeland Security represents unique 
capabilities in that regard. We are the people who inhabit and 
control the borders. We are the people who inhabit and control 
the borders. We are the people who take care of the brown water 
on the shores of our nation. We are the people who sense the 
environment to protect important persons from harm. We are the 
people who administer the safety of our transportation system.
    No one else does these things. I believe we are being 
recognized as bringing unique and very valuable, not only 
information, but skills and capabilities to the table. I will 
have to tell you that I still detect some resistance, among 
others, to mention of those ideas in the context of the 
Department of Homeland Security.
    There is still sort of a default mechanism out there that 
when you talk about transportation security, and you might say 
TSA. If you talk about the Coast Guard, you talk about the 
Coast Guard. But over time, some development of the concept of 
an umbrella organization is gaining strength and will come to 
fruition. That would be the development of a very valuable 
concept for the Department of Homeland Security, which can 
achieve intra-component synergy among all of these 
capabilities.
    The simple answer is, yes, we bring something to the table, 
now and more in the future.
    Mr. Langevin. I see my time has expired. Thank you for your 
answer to the questions, and again thank you for your service.
    Lieutenant General Hughes. Thank you.
    Mr. Simmons. [Presiding.] I thank the gentleman for his 
questions. If he refers to the bipartisan Senate Intelligence 
Committee report of last year, the first eight conclusions deal 
with issues of group-think, and a contributing factor to group-
think is a lack of information.
    The gentleman from California is recognized, Mr. Lungren.
    Mr. Lungren. Thank you very much, Mr. Chairman.
    Thank you for your testimony, General, and thank you, more 
importantly, for your lifetime of service. We all appreciate 
that.
    Could you give us an idea of where you think your 
department's information analysis capability is right now? That 
is, if you have to say that complete success would be a 10, and 
we know we could never get to a 10; maybe 9 is what we can 
achieve because we are always changing for that last one. As 
you leave, where do you think it is?
    Lieutenant General Hughes. Five to six.
    Mr. Lungren. If it were five to six, for us to get up to 
nine, what are the very specific two or three priorities that 
you would have the department emphasize with your successor?
    Lieutenant General Hughes. The kind of experienced, 
analytic workforce, public employees that we can depend upon 
over time, that will stay in this occupational field and 
continue to do this work for a long period of time. This is not 
conventional or routine intelligence work. It is different.
    Second, improvement on facilities. The facilities are 
inadequate to the task. We need support in that area.
    Three, you need a full understanding of the remainder of 
the intelligence community about what it is that we are doing, 
why we are doing it, and how we are doing it. I think that is 
the third item on the list for a reason. That is the lowest 
priority. The first two are vital.
    I would mention that we need more time. Everyone keeps 
saying, and I heard the Chairman mention a ``two-year period.'' 
It is true that we have been in existence for over two years, 
but I can tell you that we were not functional when I arrived 
on 17 November, 2003, in the intelligence business. We had 27 
people; we could not do the job. Time period has to be measured 
in capability and effectiveness. We were not effective. We are 
not completely efficient and we are not as good as we should 
be. The progress is real. We just need some more time.
    We also need more people of the right kind, government 
employees, better facilities and structures, and we need 
understanding and support.
    Mr. Lungren. General, when I was Attorney General of 
California, one of my responsibilities was the head of WSIN, 
the Western States Information Network, one of the RISSes 
around the country. Are we utilizing the RISSes around the 
country effectively in information gathering and sharing?
    Lieutenant General Hughes. Probably not as effectively as 
we should. That is a process that we began this past summer by 
having people from all of the states come here to Washington. 
We began to inform them about the methods of information 
sharing at that time. We have a plan in place to have that same 
kind of gathering again this summer, and we are sending out 
mobile training teams who help people understand how things can 
be improved in that regard.
    Mr. Lungren. Let me ask the question this way: Are we 
utilizing the RISSes as a platform to provide information to 
you? Or are you duplicating or replicating that?
    Lieutenant General Hughes. We are using the RISS, the law 
enforcement network, and others to the degree that we can. It 
is a cooperative effort.
    Mr. Lungren. Okay. Sure. I know you are loath to criticize 
anybody, and I will not ask you to do that here, but I will 
just give you some insights I have received from some law 
enforcement people on the ground or in middle-management 
positions. They still find a reluctance to share information 
from the feds on down, specifically with the FBI. I would 
normally say, ``Well, you are always having grousing like 
that,'' but when I was Attorney General, frankly, I can tell 
you it was very serendipitous as to whether or not we got a 
spirit of cooperation from the feds, whose need to know seemed 
to be the feds need to know, but you do not need to know.
    Much information in the domestic arena, frankly, can be 
gathered as well and sometimes even better by the many more law 
enforcement officers we have at the local and state level than 
we do not the federal level. They are much closer to the 
street. They have more contacts. They may not have all the 
contacts in the specific terrorist organizations, but they have 
contacts with a lot of people that may come into contact with 
them. It is debilitating for them to be viewed as second-class 
citizens, and to have the feds say, we have the view, we have 
the mileage, we have the right to know, and you do not.
    I see it expressed in this way. That is, with the color 
code system we have and the alerts that they receive, they told 
me that oftentimes they would receive these alerts without 
really underlying information. So they were told generally 
speaking the threat assessment was higher, but they did not 
have real information therefore to respond to that. That, to 
me, suggests an underlying lack of trust of local and state 
government that still pervades the federal establishment. Can 
you tell me whether you have seen that, number one; and number 
two, if you have, what steps in particular has your department 
taken to try and break that down?
    Lieutenant General Hughes. First, everything you said I 
have heard. We may know the same people.
    [Laughter.]
    Mr. Lungren. We will not put that on the record.
    Lieutenant General Hughes. I have to tell you that I think 
it is absolutely accurate. The phenomenon of the arrogance of 
the federal establishment in relationship to the state and 
localities with regard to information is well known.
    Mr. Lungren. Well, members of Congress excepted, of course.
    [Laughter.]
    Lieutenant General Hughes. Sir, you can believe whatever 
you want. I have heard a lot about this.
    [Laughter.]
    Mr. Lungren. Better watch it, General. Be careful there.
    Lieutenant General Hughes. I have to tell you that I think 
it is an accurate portrayal. The local effort feels like they 
are second-class citizens because of the attitude that is 
conveyed to them by some federal officials.
    I do not think that is across the board. I think it is 
somewhat circumstantial, but nevertheless, it is a fact.
    What we have done is, first, we are sending out a lot more 
information; that is simply a fact. We can prove that by simply 
showing you the documents we now send routinely to the states 
and localities. We did assemble them here, and we are going to 
assemble then here again this year. It is a participative 
effort. Admittedly, it was not much of a dialogue. That is too 
bad, but in the first instance we had a lot of things to put 
out to them. And they actually thought it was very worthwhile.
    This summer, we have meetings here in Washington again over 
a three-to four-day period. We hope to make it more of a 
dialogue and we will hear from that more.
    By the way, we have this in August, so if there is any 
possible way we could get a Congressman or a Senator to come 
and meet before that group and give your views, we would really 
appreciate it, because this kind of interaction is vital.
    We have also established, and we are establishing over 
time, relationships with people. Some of these relationships 
are very circumstantial and short-lived. I did not meet the 
sheriff of Las Vegas, even though I had telephone conversations 
with him and talked to him on a couple of occasions. I never 
met with this gentleman personally face to face until a few 
days ago. Indeed, when I met with him, he had his share of 
complaints.
    But he is the guy in charge of Las Vegas. What do I know 
about Las Vegas? Nothing. I am completely dependent on him to 
know primarily what is going on in Las Vegas.
    However, he recognizes, I think as most localities do, that 
occasionally, especially in the world of terrorism, big 
problems can come toward specific towns and cities that the 
town and city do not know about. That is a fact. It is the 
nature of the larger world of intelligence and 
counterterrorism. They do not come and rest and stay in exactly 
the target place, so that everybody and their brother gets to 
know them. They project themselves into these environments and, 
usually relatively rapidly in the target area, take action.
    So we are trying to get a mutual understanding of the 
phenomenon. We do at the national level, at the federal level, 
have something to contribute, and we should contribute that by 
passing it to the states and local authorities, and we are 
trying hard to do that. We have made improvements, and if they 
were sitting here in this room, I think they would say that. I 
think they would say, yes, things are better than they used to 
be.
    Mr. Lungren. Thank you, General. Mr. Chairman, could we ask 
the staff to work with the General's staff for us to be able to 
see when threat assessments are made, the level of information 
that is given to local jurisdictions, so that we might be able 
to see what we are really talking about, because I have had 
these complaints from law enforcement saying they have 
inadequate information once a threat level is given to them. 
Maybe we just need to look at it ourselves.
    Mr. Simmons. I would be happy to do that. I began my 
political career as a police commissioner, and in the post-9/11 
environment, the new model is not local, state, federal each 
doing its own thing. The new model is communication between all 
levels. I know the Ranking Member has expressed to me her 
frustration over the same type of issue. My guess is that this 
is an important consideration for this subcommittee, and we 
will certainly look into it.
    Lieutenant General Hughes. If you do not mind, I must give 
you just another piece of information.
    Mr. Simmons. I do not want to deny you, but the 
distinguished lady from Texas, her questions, I know she has 
been here for a while, so make it brief, General.
    Lieutenant General Hughes. Okay, I will make it brief. The 
question you posed to me was in the context of the homeland 
security alert system, the changing of the colors. It is true 
that in the initial application of the changing of the colors, 
not much information was given. It is increasingly true, has 
been over time, since the Christmas 2003 and January, February, 
and March 2004 period, we have given more information. I will 
make sure you have the context of the question, there. But I 
think it is a very good thing to ask, to have us give you a 
better characterization of how much information we are giving 
out.
    Mr. Simmons. The distinguished lady from Texas, Ms. 
Jackson-Lee.
    Ms. Jackson-Lee. I thank the Chairman and the Ranking 
Member.
    General let me thank you for your service, and try to go 
quickly through my questions because of the time.
    I believe that one of the aspects of the IAIP's most 
important issues is the analyzing and integrating terrorist 
threat information and making sure that amongst any other 
agency that we relate to the homeland, I think of the FBI and 
the CIA as having their own constituency bases, even though we 
are trying to work very hard at the integration of those 
agencies, really in terms of fighting terrorism, the Department 
of Homeland Security signified to America that we are focused 
on their needs and providing them with the intelligence they 
need to understand the terrorist threat and to fight terrorism.
    As I look at the budget, and I know that this is 
particularly related to the intelligence needs, I think a point 
worth noting is that the President's budget indicates that 
government-wide spending for homeland security increases really 
overall by $1 billion. To put this in perspective, we all know 
that we are spending about $1 billion a week in Iraq and 
probably other added dollars in Afghanistan. In particular, I 
believe that there is an intent to hire an additional 73 more 
employees, and also to seek ways of improving our ability to 
analyze and integrate terrorist threat information, map threats 
against our vulnerabilities and implement actions to protect 
American lives.
    I know that we are going to lose your talent in March, and 
again let me thank you for your service, but how are we going 
to do that when we are looking at a potential cut of $20 
million? Might I add to that question a statement that you made 
in your speech when you were able to say that we were able to 
connect the homeland security information network with the 
regional information sharing system, and I think the previous 
question raised that question. You yourself said that one needs 
to be achieved, but we are on the right track. If you could 
expand on what you gave to Congressman Lungren, and talk 
specifically about the ability to hire employees and try to 
improve what we are trying to with this budget cuts.
    Lieutenant General Hughes. If I understand the question 
right, ma'am, the budget cut is not an assured thing. The 
Department of Homeland Security expects plus-up in our overall 
budget as you described, and we do not expect for the budget to 
be cut back. That is our hope.
    Ms. Jackson-Lee. But if it is cut back, then you will have 
difficulty fulfilling your mission. Is that correct?
    Lieutenant General Hughes. That is true. That is correct. I 
would certainly hope that that does not happen.
    With regard to the idea of whether or not we can do the job 
and how well we can do it, the connectivity that we have out 
there with the RISS system and the LEO system and others, this 
is an evolutionary thing. We just discovered not long ago a 
system that is run by the Federal Protective Service, which is 
part of the Department of Homeland Security, which is a portal 
into law enforcement information the Federal Protective Service 
holds. That is within our own department and we did not know it 
existed until not long ago.
    So we are learning. We are developing over time. A lot of 
these things, even though they may seem self-evident, they are 
not. We have had to ferret them out. I think we are continuing 
to make good progress.
    The answer I would give to you and to the person who asked 
the earlier question is, connectivity is almost everything. If 
we do not have that, and I think the Chairman is familiar, 
information not shared is worthless. That is it. That gets to 
the central idea here. We can get the information. The next 
imperative is to share it. That is what we are all about. So we 
have been trying to build and make this interconnected network 
a system of systems, whatever names you want to apply to it. We 
want to make sure it is interoperable, that it has enough 
elements of commonality so that we can pass information 
horizontally and vertically throughout the system. That is what 
we would like to do.
    Ms. Jackson-Lee. Mr. Chairman, I appreciate the General's 
views, and Ranking Member, sort of focusing on our questions, 
but let me just say that this exercise poses a very difficult 
challenge, because it is very difficult when you have 
overlapping committees of jurisdiction such as the Budget 
Committee. Your expertise and the Ranking Member's expertise on 
some of the aspects of this, still the time is not long enough 
to sort of probe General Hughes and the knowledge that he has.
    Two points I think are key to this, and I would start out 
by saying that homeland security connotes security of the 
homeland. People think of the FBI and CIA, so you have a great 
responsibility. I think that this one sentence that he has, the 
pages are not numbered, but when he talks of RISS and the law 
enforcement online, one needs to be achieved, I think in our 
work we need to focus in on whether we have appropriate 
resources to make sure that the communication is going on in 
the homeland with law enforcement.
    Another point is, and I think it is very important, is this 
right-to-know rule. We look forward to your expertise, but I 
wonder whether or not this committee will have oversight to be 
able to refine that in this new post-9/11 era. For example, and 
I will close on this note, General Hughes, there is something 
called OTMs at the border, the southern border, other than 
Mexican nationals coming across. That has taken a new life, 
that there are potential individuals coming across that border 
that may do us harm. The border patrol agents then become a 
greater force with respect to their need to know, and they need 
to know classified information or information at a very high 
level. I am not comfortable that even in this budget oversight 
we have focused on it.
    General Hughes, I thank you for the one very great point 
that you said, if we cut the budget and do not provide you with 
the resources, you are not going to be able to do the job. I 
think that is our responsibility.
    I yield back, and I thank the Chairman for the additional 
time on the clock. Thank you.
    Mr. Simmons. I thank you for your comments. I think we are 
all aware that this is the first hearing of the permanent 
subcommittee. It is historic in that regard. The opportunities 
for us are pretty dramatic, but the challenges are also great. 
It is an area where we have to work together and share together 
to be successful. I thank you for your comments. I think they 
are right on the dime.
    We will keep the record open for 10 days for any additional 
written comments that anyone may wish to submit. I have a few 
remarks to make as closing remarks, but I would like to 
recognize my Ranking Member, if she has remarks she would like 
to make.
    Ms. Lofgren. This is just the beginning, obviously, and 
General, we do appreciate your being here today, even though we 
will not be seeing much of you for long. I think certain 
questions have become more ripe in our minds as we listened to 
you. The connectivity of the system obviously is important, 
whether it is the Internet or whether it is intelligence. 
Therefore, we are dependent on agencies both within DHS, but 
also without. So we certainly cannot do it today, I am thinking 
about the FBI system that we had great promise for, but did not 
produce, and how that is going to impact DHS.
    I have spent 10 years on the Judiciary Committee paying 
attention to immigration, and I am very well aware of the 
deficiencies in the technology and that aspect, and the impact 
it has on the ability to gather information that then could be 
shared. So I am hopeful that as we move forward in this year 
that we will be able to look at those as they connect and maybe 
get some improvements that will make us all safer.
    I did want to just follow up very briefly in writing, but 
comment that I am concerned about the ``need to know'' 
information issue. Certainly, the Congress cannot micromanage 
an intelligence agency. It would not be proper, but I am 
concerned that if that is an ad hoc decision being made in the 
agency, then we have maybe failed to actually have the policy, 
the ``who voted for'' implemented. I think we have to explore 
that further, Mr. Chairman.
    Finally, my colleague from California mentioned the 
frustration that local agencies have. I think that has improved 
somewhat with Director Mueller and the FBI task force. At least 
the feedback I am getting from law enforcement is much 
different than I used to. But what I am hearing form local law 
enforcement is that they never hear from DHS. It is invisible 
to them. So I think we need to sort through and be parochial. 
There are more people living in Los Angeles County than there 
are in over 20 states, and how we are dealing with the gigantic 
nation-state of California and whether that system is going to 
work for that state or not, and how we might format it so we 
really do have a system that is slick and works and protects 
us.
    I thank the Chairman for recognizing me.
    Mr. Simmons. Thank you.
    Just very briefly, back in 1981, I became the staff 
director of the Senate Intelligence Committee, working for 
Senator Barry Goldwater as the Chairman and Senator Daniel 
Patrick Moynihan as the Vice Chairman. Try that one on for 
size, staff. The Chairman is Senator Goldwater. Well, you are 
too young to even remember who he is; and the Vice Chairman was 
Daniel Patrick Moynihan, a good Republican and a good Democrat. 
One from the west and one from the east; one conservative and 
one liberal. I sat and worked with them for 4 years as they 
initiated what I consider to be professional congressional 
oversight of the intelligence community.
    I learned about the value of bipartisanship, and I learned 
about the value of listening to others when it comes to the 
intelligence business. I learned that you can put those 
differences aside if you are focusing on a common goal, which 
in that case was to build the intelligence community to 
preserve and protect our values and our people and our country.
    Regrettably, on 9/11 we failed in that regard. So the 
mantle has been passed to another generation of members of 
Congress and another generation of members of the staff, to do 
what we can do to preserve and protect our homeland, while at 
the same time preserving and protecting our civil liberties. 
That is an awesome challenge. In those days 25 years ago, we 
did not have a hearing room or spaces that were ours. We 
occupied the auditorium in the Dirksen Building. Today, we do 
not have a hearing room, I do not believe. We are looking for 
one, although this is much better than the auditorium of the 
Dirksen Building, I can assure you.
    But we should not let these little logistical challenges 
get in the way of the important work of this subcommittee and 
of course the important work of the full committee.
    I will leave you with a final thought. For the 4 years that 
I have been a member of Congress, I have never changed the 
license plate on my car. I know some immediately go out with a 
screw driver and put on that lovely congressional plate. But 
the plate that I have on my car has the simple phrase ``kung 
ho,'' which conveys enthusiasm and excitement, but as we all 
know comes from the Chinese word ``kung ho,'' which means 
``work together.''
    I look forward to working together with the staff, with the 
members of this subcommittee, with the Administration and 
others, to pursue the important agenda that we have before us.
    Thank you all for being here today.
    And thank you, General, for your participation.
    [Whereupon, at 3:37 p.m., the subcommittee was adjourned.]



                            A P P E N D I X

                               ----------
                               --________

                   Material Submitted for the Record

  Questions and Responses Submitted for the Record by the Hon. Bennie 
Thompson for Acting Assistant Secretary for Information Analysis Karen 
                         Morr on behalf of DHS

    Question: 1. General Hughes, one theme the Department has repeated 
in describing the President's Fiscal Year 2006 budget is consolidation. 
I think we all recognize that the current organizational structure at 
DHS isn't necessarily the best one, and that moving offices or 
functions can improve performance or reduce cost.
    Some agencies, including the office that distributes billions of 
dollars to first responders, rely on IA for threat information. 
However, some parts of DHS have their own intelligence departments--
including the Coast Guard and Secret Service as part of the 
Intelligence Community, but also TSA, the Federal Air Marshals, CBP, 
and ICE. Thankfully, many of these programs are unclassified, so we can 
talk about their budgets in public. TSA, for example, is requesting $21 
million and 99 FTEs for Fiscal Year 2006.

    Question: 1. Given the trend within DHS for consolidation, for 
example the transfer of research and development activities to the 
Science and Technology Directorate, should IA have more control over 
all the intelligence operations in DHS?
    Intelligence is integral to the successful operations of the 
Department of Homeland Security (DHS). In our efforts to build a strong 
Department from its original 22 agencies, it is critical to coordinate 
DHS intelligence functions. The ability of the Department to conduct 
its mission is enhanced when components have synchronized intelligence 
activities. The Office of Information Analysis, in concert with the DHS 
components that have intelligence activities, is conducting a study 
with the intent of developing a plan to integrate key aspects of these 
activities. That study is reviewing several elements of the 
intelligence program, including mission areas and supporting functions. 
The results of this study will be presented to the senior leadership 
this spring. IAIP will continue to work to ensure the Department's 
intelligence activities are coordinated.

    Question: 2. With the first deadline on the ``Information Sharing 
Environment,'' as mandated by the recently enacted Intelligence Reform 
and Terrorism Prevention Act, occurring in less than two months, do you 
know what will be the role of DHS in operating or setting the rules for 
the ``environment''
    The first deadline related to the terrorism information sharing 
environment (ISE) was met. The President designated John Russack as the 
Program Manager responsible for planning for, overseeing the 
implementation of, and managing the ISE pursuant to section 1016 of 
P.L. 108-458. Per our statutory authorities and responsibilities, DHS 
has a critical role in the development of all aspects of the ISE, 
including the establishment of the business rules for the ISE. DHS has 
been actively engaged in the work to date toward developing the ISE and 
will continue to have an active role in relation to this Department, 
our stakeholders, and the community at large.
    In particular, DHS has a unique role, as defined under the Homeland 
Security Act, for sharing homeland security information with state, 
local, and tribal governments as well as the private sector in relation 
to critical infrastructure. Specifically, Executive Order 13311 
delegates to the DHS Secretary the responsibilities for procedures for 
prescribing and implementing information sharing as defined in Section 
892 of the Homeland Security Act (P.L. 107-296). Improving information 
sharing has been and continues to be a top strategic priority for DHS. 
The Information Sharing and Collaboration Office (ISCO) was established 
in DHS to provide focus and coordination for these statutory and 
Presidential mandates.
    DHS is currently a key link among State, tribal, and local 
government, as well as the private sector critical infrastructure 
entities. The Department is already operating in critical information 
spheres (defense, intelligence, homeland security, law enforcement, 
private sector) and is providing strategic guidance to oversee the 
development of their intersection and collaboration to produce all 
information necessary to govern and protect and will coordinate these 
activities with the Program Manager.

    Question: 3. After the 2004 elections, then-Secretary Ridge said 
that there had been a decrease in chatter and that the threat of 
terrorist attack was lower than it had been in some time. Is that still 
the case, and if so, how do you account for that?
    Beginning in Summer 2004, we began to see a decrease in incoming 
credible and/or specific information mentioning direct threats to the 
United States. The reasons for the quantitative and qualitative 
decrease--which lasted through late February 2005--remain unclear. 
Since then, we have tracked a number of threat streams deemed credible 
and/or specific to Homeland-related interests, however we do not know 
if this is related to the natural cycle of the intelligence collection 
process or other factors more related to actual terrorist operational 
planning.
    Despite this relative increase in credible and/or specific 
reporting since late February, we continue to lack information 
indicating an imminent threat to the United States, as well as the 
timing, targets, or methodology of any potential operation. While the 
Department of Homeland Security (DHS) and the rest of the Intelligence 
Community are still analyzing each particular threat stream, as well as 
those streams collectively, they do reinforce our perception regarding 
al-Qaida's ongoing strategic intent to conduct another dramatic attack 
in the United States. This intent and possible planning is reflected in 
all-source intelligence reporting, vice a single collection discipline.
    We note that the reporting level from vague, low-credibility, or 
undetermined sources (call-ins, write-ins, walk-ins, media 
pronouncements, etc.) regarding possible attacks on the Homeland 
remains relatively constant and numerically more significant than 
reports from ``credible'' sources.

    Question: 4. What changes are being considered for the Homeland 
Security Advisory System, and will the system continue to be used in 
its current structure?
    The Homeland Security Advisory System (HSAS) has evolved throughout 
the history of DHS and currently includes the flexibility to assign 
threat levels for the entire nation, or a particular geographic area or 
infrastructure sector, depending on the credibility and specificity of 
available threat information. The HSAS is a collaborative process which 
takes into account current threat information and incorporates the 
perspectives of other federal entities (both within and outside of 
DHS); state, local, and tribal partners; and private sector 
stakeholders. DHS learns new lessons and continues to improve the 
system each time HSAS level changes are considered.