[indistinct conversation]

>> donald trump criticized house republicans for backing the deficit reduction plan. speaking in new hampshire, he also said u.s. officials should mitt that torture may have been used during the search for bin

laden. this is just over 45 minutes. [applause] >> thank you. what a nice group. it is say -- an honor to be here. a friend of mine asked me to come up to new hampshire and made a speech. i did. it was a motivation all-time speech. the nice part about new hampshire, everybody works. that is why i like new hampshire. a lot of workers. i made the speech in came back and heard i was running for president. that was the first time i heard about it for donald trump.

it was interesting. i will say that all of my life i have heard that very successful people cannot run for high office. i have just heard is so many times. it is interesting because nobody said it was going to be easy. i had no idea i would be hammered like i have been hammered over the past three weeks. i think it is a compliment. i am not sure. i am an example at the washington speakers dinner. it was interesting. the correspondents' dinner was packed with people. it was an amazing event. i have been there before. i knew what i was getting into. the president got up and said things. he said a lot about me. they were jokes. a picture of the white house with the trump on top of that.

there was a comedian that got up and started to talk about me. i look to my wife and said, is this a good thing? am i supposed to be honored or hide under the table? i sort of just sat there and listen. it was a little bit amazing. i will say it has been an amazing period of time for me. i am not a professional politician. i think that is an asset other than our great mayor. [applause] i think that has turned out to be largely an asset according to a lot of people. i took on the president. i was very strong in saying, put up your birth certificate. whether i was right in doing that, i do not care. why not show it? why did it take so long? i was honored i was able to get

him to do it. i guess he will continue. that debate will rage and everything else. my big thing has been jobs. it has been jobs. the economy. i built a great business. a really great business. a belted over years. it is doing unbelievably well. we have made a lot of good decisions. decisions that have been terrific. i love doing what i am doing. i hate getting out of that business and doing something else. but our country is in serious, serious trouble. like it has never been before. the kind of numbers we're hearing today are so unbelievable. they are so incredible. a few years ago you never heard the word "trillion."

now everything is trillion. deficits, and debt, budgets. trillions of dollars in the hole. a lot of people do not see how to get out of bed. my business can be good but it will not be good if the country is going down, down, down. it has a very big shot at doing that. i am a very no tax person. i can tell you if president obama gets reelected, i think taxes are going to go through the roof. i think he is holding them down as long as he can because he wants to get through the election. i met with a great group of folks. some of the real community leaders. we had a frank discussion. i said, if he gets in office, i honestly believe your taxes are going to go to a level they not have been at in a long time. that is not one to be good for

the country. that will not be good for business. it will not be good for new hampshire. we have a real problem. the problem we also have is, we do not use our best people. negotiation is an art. i have seen it over many years. i know the guys in new york. i can tell you who does the good deals, bad deals. it is an absolute art. we are not using our right people. china is going to make $300 billion. off of this country. beyond that, they are taking our jobs because they're making our products. they make our product, they take our jobs, they do with through manipulation of their currency. then the president comes to the united states and we hold a beautiful evening at the white

house. in other words, we honor a man that has taken advantage of the country. i do not blame him. if you can get away with it, why not? they buy our debt and we pay them interest. it is unbelievable. you look at what opec is doing. these folks sit around a table. you probably saw saudi arabia said, there is a lot of oil out there. we are cutting production. the cut back production because they want to keep prices high. we do not have anybody to say that will not happen. we protect them. they pay as virtually nothing. we protect so many countries. we protect south korea. i ordered 4000 television sets for hotels. i love things that are in trouble. that is what i like to buy. [laughter]

[applause] thank you for telling me. i'm only kidding. actually i'm not kidding about that. anyway it is a nice hotel. i'm going to take a tour later. [applause] i'm more used to that. you look at what opec is doing to this country. i will say, the worst abuser of the united states, and the word is the right word to use, is opec. the second worst is china. then there are many countries after that. columbia. the fourth largest current -- country in latin america. they made for billion dollars. this is not a huge country. we do not do that much business with them. they made four billion dollars.

what is going on? we're signing a new trade pact that i do not think it's going to be as good as the old one. you wonder, where does this thinking come from? how does that happen? you look at the deficit. i am a proud republican. i am proud of our ideals, most of them. i looked at a plan that was put forward. i like paul ryan but the plan that was put forward was early. there was no reason to put a plan for word where they're talking about touching medicare at this point. there is no reason. medicare and medicaid come in by the republicans. you have elections to win. the republicans have elections to win. the democrats, they are doing a number on that plan like i have never seen. in upstate new york, we lost a

congressman to show what a great body he had. he was looking for people on the internet. they caught him. he should be thrown out. we agree. a very popular republican woman is running for the office. she was expected to win easily. easy like crazy. the other day, there was a story she may not win. she is having a hard time defending the situation. with medicare. i'm talking about negotiation. one of the great business books of all time, the art of the deal. it is the biggest selling business book of all time. every time i mention it, people love the book. people tell me they started by

reading the book. whatever. call it the art of the deal. you have to let him go first. let him put up a plan. then you can use your debt limits, all sorts of things to do what you have to do. when you look at the 30 billion and it was 300 million in savings, there are so many things going on. what is happening? what is happening to this country? we have a chance to be great again. honestly, the way we're doing, think of that. i saw a report. we're spending $2 billion so brazil can drill for oil. why aren't we drilling for oil? [applause] a friend of mine who is doing

pretty well, not a real rich guy, but a guy who was wanted to do this, he is buying an airplane. what kind of a plane? he tells me the name. where is the maid? brazil. why brazil? i get a tax credit in the united states a 5 by this plan. what is going on? we do not use our right people. i know what street very well. i know all of the killers. the guys that are the smartest. i know sort of all of them. when we negotiated as china, -- against china, why aren't we using our smartest business people? i would put them against anybody. we have the best. instead, we use a diplomat.

as i have said, you know what a diplomat is? that is a person the studies have to be nice. i do not want a nice person. that is why i may not make it. i am not then i saw a person. i tell you what, i would make this country great again. [applause] that i can tell you. we had a great victory last week with the killing of bin laden. that was great. [applause] enhanced interrogation lead us to that. enhanced interrogation. we are so politically correct. nobody wants to say a. nobody wants to use the word. isn't it another word for torture? the people i watch jump out of the world trade center, that was

torture. we catch this guy, they shoot him. they give him a religious ceremony. they take 45 minutes. why? i do not understand that. in terms of torture, enhanced interrogation, we would not have caught bin laden without it. that is what got us to him. there are investigations, numerous people, that used enhanced interrogation, to use the nicer term. after september 11. i think those people should not be under the kind of gun they are under. i do not think so at all. [applause] one of the things recently

found is that bin laden's plan, and he had many of them, was to bankrupt what was the former soviet union. he succeeded. now it is called russia. a powerful smaller version. that war bankrupting russia. he wanted to bankrupt the united states. we are spending $10 billion a month. on building schools, on all of the other things we're doing in afghanistan. for what? what are we doing? i heard something i'm going to do a little research on. while we are fighting in afghanistan, i heard they have mineral resources in afghanistan. i look at the oil, a look at

iraq, i see things. but mineral resources. in a who is in there? china. while we are out there fighting spending billions and billions and billions of money. nobody knows how much. but we are spending billions of dollars on fighting. china is trying to get the minerals. think of that. but we cannot build schools in our own cities. we cannot build roads in our own cities. i have been to china. i see bridges going up and airports like you would not believe. when was the last time the side major bridge in the ad states? it does not happen. you cannot get the environmental approval. a friend of mine from china, i

respect what they can do. if they can take advantage of our leaders, i have respect for that. they are filling in a big chunk of the ocean. i say to myself, how long did it take to get the environmental permits? he said, what? what you talking about? it is the ocean. they're going to build a big complex. they build new cities over there in about 12 minutes. the star work the next day. it is a little different than what we do. i have got many environmental awards. i do not want to sound like this into fairness. i have seen jobs that would

employ people stopped because of a blade of grass that happens to be unique. i have seen them stop over a certain type of fish over this and that. i'd go with consultants all the time. i look at them and say, that is horrible. that is horrible. that will stop progress. actually, donald, it is not horrible for me. i am making a fortune. these guys go to albany and make the restrictions harder. the consultants working for use of it you have to hire them to get them through this situation. in many cases, you cannot get through. you cannot go through the process. i could tell you job after job after job. even the drilling of oil where

abu dhabi, they have such resources, they went out and announced they were going to have all of their transportation needs done in gas. they wanted natural gas. that is that. they're going to sell the oil to the ad states and other places. we have more natural gas than anybody. wind is limited. solar has not been perfected. it is expensive. i know them all. i want to use solar for my building. i am good at dollars. i look. they come back. seller will take you 22 years. that is not so good. maybe i will not use solar. it has not been perfected. it will get better. we have tremendous, we are the

king of coal. we are the all-time of natural gas. then you hear a country like abu dhabi using natural gas to sell their oil. it is incredible to me. i look at what is going on. i look at pakistan. i have to say, if you look at -- neileilly, no caputo cavuto, i said bin laden is in pakistan. we give pakistan billions and billions of dollars a year. we're going to give them $3.2 billion. i said, listen, i and a stand something about that. you tell them that we're not giving them -- this was on two

shows -- you tell them, we are not giving you any money unless you hand over to west osama bin laden. everybody looked at me like, eh. no politician picks them up. obviously they're not very good. it is interesting. i have another one. when they are good, they do not give me credit. when i buy a piece of realistic, i own it. when you come up with a good idea of politics, if they like it, they take care. by that time most people forgot it was trompe's idea. i love to get credit. [laughter] you could look over the last number of weeks on television.

let them give us the sky. if anybody thinks they did not know he was there, where they have a sophisticated -- that he was not sitting in this big house. i did nothing to was beautiful, but you know. does anybody want to live there? i do not think so. if anybody thinks that the government did not know he was there, they are foolish. they are not really our friend. they are not our enemy. i think this is important. the bad guys could take over pakistan easily. it could happen. we would not know what is going on. they have nuclear weapons. they need our money. we do not give them any money unless they get rid of nuclear weapons. to me that is simple.

[applause] i hope it does get picked up by some of the other people. they go out and use their money for themselves. but they go out and use that money for nuclear-weapons. let's say they are semi- friendly. they may not be at all friendly. they may be tremendously against us, including israel. they have serious nuclear weapons. they need our money. that is a deal i would make and would not veer from that. you cannot let them have those nuclear weapons. another one i gave the some people did pick up, iraq. we going to wrap. we have spent 1.5 trillion

dollars. we have lost thousands of young men and women. we have tens of thousands of people that are incredible people that are horribly wounded. legs and arms missing. all over the cities. all over the cities. i see it in new york. i see it all over. we go in, we fight, and we leave. somebody said, democracy. give me a break. iran is going to takeover. we have decapitated their armies. it is going to happen. i heard they're closer to the leaders of iraq than we are. hear.t surprised to iran is cunning. they have been fighting for years. for years they were equal.

then they fight again. now we have done, we have decapitated one of those countries. iran will go in. sure, they want the country. but there really want the oil. iraq has the second-largest oil reserves in the world. some 15 trillion dollars. that is close to our deficit. isn't that interesting? have said to people, what is this? maybe i'm old-fashioned. we are in there. i have friends that are smart people. some of them are very liberal. a lot of them are saying, donald, are you suggesting we take the oil? that is a sovereign nation. excuse me? some people love that.

they are the smart ones. when we went into iraq, if you remember, a lot of the so-called smart ones were saying, we went in for the oil. we did not. we did not know what we were doing. he did not on the world trade center. if you do not like saddam sees -- to say it does not make any difference. it had not -- nothing to do with it. he killed terrorists. you could not be a terrorist in iraq. he would kill you. now, iraq is the harvard or terrorists. afghanistan is pretty good too. what are we doing? we have our army over there. you know the kind of money we're

talking about? they have 15 trillion in oil. we have spent 1.5 trillion. at a minimum, we get our money back. we pay each one of the families of those soldiers that died a couple of million dollars. we give our wounded a lot of money. it's peanuts compared to what the numbers are in this incredible oil reserve. incredible. we pay those families back. people say to me, you cannot do that. it is sovereign. let me ask you this, when the families of those fallen soldiers are sitting home watching television after we're gone. when the families of those

soldiers are sitting home, when iran goes and takes over iraq and the oil and tells everybody else to could united states is, how do you think the parents of that 22-year-old soldier, how will they feel about that? those soldiers will have died in vain. all of the wounded, all of the money. what a terrible situation. just like i said. i have made a lot of good predictions. i made a lot of predictions in my book. i said terrorism is going to happen. i am not saying i'm a psychic. i have a good instincts. i think most of bees -- business people do. we are ahead of the curve. i have an instinct. i said terrorism will be a big factor. people did not know much about what it was. that was 10 of years ago.

we will have a great crash. we did. we could have a second one. if gasoline does not go down, we will have a second crash. if oil stays over $100, we could have a real problem. we could have a real second dip. i know how to deal with opec. i know how to deal with china. at some of the smartest chinese. i mean a lot of money. i was proud of myself. i made a lot of money. you have to know how to deal with the people. they are smart, cunning, and they're not our friends. remember that. they're not our friends. at all. i'm thinking about running. i must be honest. it is tough.

i am very anti-establishment. that includes republicans. i have respect for paul ryan but i would not have done it the way he did it. there was no reason to do it. let the other guy lead. then you go into your number. you get something that is going to make the country great again. i'm very anti-establishment. i see the republicans taking a shot. people will say that things, but what really couldn't people take a shot at? i want to take care of our soldiers. i want to take care of our people. i want to the oil. i want reimbursement. and other countries like britain. i want to take advantage of a situation. when you think about it, what is going to happen?

i am a republican. i am doing nicely. i have not announced whether i am running. even the republicans do not like it because i'm not in the club. i am not in their club. you cannot be in that club. that club is not what is going to make us a great country again. we have tremendous potential. tremendous. unbelievable. if we had the right people. if we knew we were doing. we cannot let china drained us. we cannot let opec drain test. we cannot let south korea train us. when i order the televisions, i said, find an american company. we have the greatest people. nobody could do it. they cannot find a company.

i need 4000 televisions. that is a lot. we have lg from south korea. we of thousands of soldiers and between north and south korea. this that they do not want the agreement. my son would not have agreed to that agreement for the united states. that is how bad it is. south korea, it was not good enough. they embarrassed the president by not signing when they were supposed to. a couple of days later, some of bombs did -- or lob over. we sent this magnificent air craft carrier and 17 destroyers and boats. boom. just to turn on the engines 2000 bucks.

we are sending this armada over there, costing a fortune. north korea said, we will stop. south korea said, we want to sign the agreement. it is wonderful. you are our allies. house to but are we? as soon as the bombs godsend, and we want to sign it immediately. who is going to notarize it? we have to use our heads. south korea makes a fortune selling as televisions and other things. they have to pay us a lot of money for protection. we cannot protect them. what are we protecting them for? so they can make money on us? a politician is not going to say what i am saying. it probably does not work. they're going to respect you more. they will say we got smart. it will have more respect.

bob when you are firm and tough, you develop a better relationship. they respect to. but when they make money because you're stupid, you -- you do not have as good a relationship. they do not respect our leaders. they do not respect what we're doing. this country is going to be going over a cliff. in closing, and i will take a couple of questions. but in closing, i want to say i honestly believe the upcoming election is one of the most important collections ever in this country's history. we have a chance to be great. we have a chance to be an unbelievable power again. i am talking about from an economic standpoint. i do not want china and

afghanistan. why isn't china helping with libya? we get nothing from them. china. why aren't they involved? we do not have the right leaders. they do not see it. if i run, if i win, that is a big if. this country will be great again. this country will be rich again. maybe this country will be respected a.m.. pratt said. it is an honor to be here. the thank you. [applause] thank you very much. >> thank you for those remarks.

per your courtesy, we will take three questions from the audience. >> make them nice and easy. >> i asked you did your name and affiliation and present your question. i will start here next to me. >> thank you for coming today. as a small businessman, the rock business, -- >> a good negotiator. i will let him negotiants china. [applause] i know you. go ahead. >> as a small businessman who is been downtown for 53 years, a concern we all have downtown is, we are losing market share. the scene a loner businesses are going away. shopping centers are being built up. what would you do as you see

these downtown's suffering? what would you recommend for us? to may be looked at from another point of view to be a viable again. to be healthy again. >> it is a great question. a lot of towns are having wal- mart and others coming in with these massive stores. it is a different thing. it is a changing time. a lot of chaff -- towns are knocking them out. in all fairness, if the economy were good, it is good in washington. washington is doing great. every -- everybody is moving to washington. that is the exact opposite of what we want. if this economy were raging, you would do so great because guys like me and others would be going to your store.

we would not go anywhere else. there is room for everybody. if we could get the economy going again, if we could get jobs back instead of having them go to india. mexico. there is a place called newton iowa where maytag was given an incentive to move out of iowa. they moved to mexico. now newton is devastated. this was years ago. if we could use the right brain power, you would have so much business. you hate to restrict these big companies from coming in. even you would agree with that. towns and of getting hurt in a different way. if we could make our country strong again, we're teetering along. it will get worse and worse because what is happening with fuel.

remember this, we have no interest rate. don't have cd's, they give you anything. if you want to buy a house, they will not give you money. you go to the banks and it is hard. i'm talking about the big banks. not you. they have taken these tremendous subsidies from the government's and they are sitting on them. that is a big problem. the real problem with gasoline in terms of bringing the world back, our world back, interest rates are going to have to go up. the dollar is being decimated. if you look at your food costs, look at the cost of cotton. that is about gasoline.

if you look at your food and clothes, they are setting records. a lot of that is because of the decimation of the dollar. we have to get the strong dollar. we have to get the country going again. you and everybody else is going to make a lot of money. >> we will take the second question over here. >> good afternoon. thank you for coming. i am with my husband and my son. we own a small business in hudson. before i ask my question, i would like to say as the mother of a young naval officer who did the deployments in the persian gulf, i do appreciate

your respect for the job those young men and women have done. >> thank you a much. i respect it greatly. >> my question is, you have made statements about not being a nice guy. being anti-establishment. things like that. to that end, if you enter the political arena, the art of compromise is something that is important. is that something you -- a skill you will develop? [laughter] were you tap into your inner nice guy? just to get the job done? >> it is a fair question. she is a comedian. i hope i am a nice guy. >> i hope the two johns go head to head.

>> i thought you're talking about canada its. -- can did its. "celebrity apprentice." ok. we do not have much room for big and negotiation. we have given that up over the past 10 years. we have to do it right. the problem that we do have is there has been so much compromise. compromise, compromise, let's do that. in the end, we have so much that we have more debt than ever before. we have more now than in all that added up together. we do not need compromise. we need to our people. we need good people. maybe we need lame duck people. maybe people will do the right

thing and if it is popular, whatever it may be, because if we do not get it in order, this country is going over a cliff. they were comparing it to greece. there were comparing us to lots of other countries you have been reading about. i was watching the other day and they said we are in worse shape proportionally. it is true. 40 cents out of every dollar pays interest. to china. other places. that are making a fortune. i think compromise is a great thing. i have made plenty of compromises. i think we're beyond compromise. we have to do what is right for the country. if we do not do it, we end up going to have much of a country left. [applause] >> i am over in the corner to

your right. we'll take the third and final question. >> but afternoon. i work for -- as an engineer in town. yet spoken about getting respect back for our country. more importantly here in the community, what are we are going to do for new jobs? you have strategies to grow the economy? >> i have a lot of strategies for new jobs. we have to take our manufacturing back from china and other places. [applause] it is easy. by toward two weeks ago new hampshire. we had a great time. we had some companies that i looked at the where absolutely unbelievable. the level of detail, the technology. these are great manufacturing companies. i was so proud i did not think

we did not have this anymore. we have great people in this country. when china manipulates the currency, you look at new england generally. everyone is going to mexico. i see plants that are empty. do you think these people want to be in mexico? we have to manufacture of our own product. we have to. we have to start manufacturing again. we have to get rid of obamacare. it is a disaster. if we do not care of obamacare, i have six friends who are in business. of the six, two are going to close their business. another pair are thinking about it. they're saying they cannot afford obamacare. we cannot do it. these are big guys. they employ a lot of people. they have good companies. they're fantastic people.

they're thinking about closing. a couple of them went to wharton with me. i never heard this. we have to get rid of obamacare. i think the president is doing this country a tremendous disservice. just like he should've given his birth certificate three years ago, i am proud of what i did getting him to produce a. -- it. it is sort of the same thing. they are in virginia, all over the place. why doesn't he allowed to go to the supreme court? he will save a year and maybe more. i know people that are going crazy with their business because they're doing this complicated restructuring on the assumption that obamacare happens. if it does not, they have to go

all the way back. why don't the various legal entities involved, headed by the president, why doesn't he let his people go to the supreme court? win or lose. at least there will be certainty. you need certainty. at least this way we will get a faster decision. ultimately, those people on the supreme court are going to be ruling on obamacare. would not be good if we knew what was going to happen? instead of waiting a year-and-a- half? certainty. it has been an honor to be with you. thank you. pratt said.

thank you. >> thank you very much. >> the wife of the indiana governor addressed the republican party at its annual spring dinner on thursday. she talked about her time as first lady of indiana and she showed videos of the different jobs she does. she is introduced by her husband. he has been mentioned as a possible presidential canada. this is about 50 minutes. >> run, daniel, run!

run, daniel, run! [cheers] [applause] >> the annual meeting will come to order. [laughter] you are a record crowd. there is a record take. [laughter] you will find the doors are locked. as soon as the last check is clear, you will be free to go. we have a record number of guests with us. many have come a quite a distance it appears. a special welcome to all of them. especially the young people of come in large numbers and they are worried about the rod deal

they're being handed. we appreciate the effort in citizenship he showed incoming. [applause] there has been awful lot of speculation leading up to tonight. beating around the bush. despite our telling everybody, they're not to look for any announcements. some insisted on ins -- experts -- expecting some. the whole business of running for national office, i am not saying i will not do it. [cheers] >> run, daniels, run! >> my friends know it has never been an intention of mine. i always thought when i was done

been governor i would like to go to some quiet place where nobody could find me. like al gore's cable network. [laughter] all the noise and speculation is only natural. it is that time of the season. there are a lot of good people maneuvering, exploring, and jockeying for position. i like my chances. if anybody is made for talking, it is me. [applause] what is important tonight is we recognize why all that chatter has happened in the first place. there is only one reason. as i am reminded on a daily basis by some article or pseudo article, it has nothing to look

with my books or personal characteristics. apparently they are distinctive. i have to be the homeless person we have never talked about according to things i read. there's only one reason. that is because indiana is different. it is different from what it has been. it is different from the rest of america. people are noticing. when people talk about great business climates, they talk about indiana. when they talk about a state with great infrastructure in a nation of crumbling of the structure, indiana is the first state to talk about. when they look around for people who have searched for ways to bring health insurance to low- income people, to conserve record amounts of our natural spaces of wetlands and beauty, more recently, to bring reform

to public education and try to get every child a better shot in life. it is indiana they are talking about. [applause] i suppose what draws attention to indiana and the progress here into this room tonight is in a notion -- an ocean ob bankrupt states, the aaa credit rating, the fewest state employees per capita in the country. the lowest property car -- taxes in the country. billions in reserves. debt pay down 40%. we are a state of people who take care of money and never forgets where the money came from in the first place.

[applause] there is only one reason indiana is different. this is something i hope each of you understand. the only reason we are different is because the republican party is so very different. this has been a source of frustration to our opponents for a long time. i think it is a source of confusion to outsiders. we do not fit their neat little stereotypes of what a republican is supposed to stand for. however republican is supposed to conduct himself or herself. we do not think -- fit that cartoon they carry in their head. the indiana republican party is a party a purpose. it is not by what did this for,

not what we are against. the only red meat when we get together for dinner is on a menu. we are too busy building a better state for our children and their children to bash anybody. we are a party of -- [applause] we are a party of ideas but more importantly, a party that acts on ideas. roads, schools, health care. all of the basic services. everyday we are looking for ways to improve them. to show the government can be limited but effective in all of the activities. it is a sacred responsibility. always we are thinking about our central objective, that is to build in our states, the best

climate of hope and opportunity. the most receptive and by impossible for investment and jobs to be the most inviting place on the planet for men of women of enterprise that come together with their ideas, their capital, their ambition, to make well for each other. we have set from our first day in the parking lot. we were going to build the best sandbox and america. we have done that. [applause] the indiana republican party is different in another respect. we are about a better life for everyone. we have campaigned in a way that says there will be no forgotten places in the state. there are no towns to tiny. now when a city to be for us to go and visit and listen and make new friends.

we have tried to govern in a way the says there will never be any foregone people in the state. this party takes as its first commitment to make a better life for the folks who are not in this room tonight. it has not been our primary objective to see that people with a lot of money make any more.

host: the sunday round table with cheri jacobus and karen finney. mike huckabee will not run for president in 2012. any surprises? guest: i do not think anyone was surprised.

he dragged it out forever his show until the last of it around so you really have to watch. good ratings for him. it was not a surprise. do let these guys have to figure out what role they have to play, if any, if they will not be in the race. can they pushed certain issues? keep them on the table and appeal to different parts of the republican base? guest: i was back and forth on this. he was giving a speech explaining what he was going to do and why. he said the leg is going to go in and he finally said it was not the right thing for him to do. ok. it was good for ratings, and i am sure that had something to do with it, but he has quite a soapbox and there. he has a big show. he has a 100% name identification and can have a big role in the debate. some of these candidates will not be top tier and maybe they can have an impact when they

will come on and endorse someone. host: here is what he said last night on the fox news channel. >> only when i was alone in quiet and reflective moments that i had not on the clarity but an inexpressible -- inexplicable he meant inner peace. all the factors say go, but my heart says now. 0-- says no. that is the decision that i made. in that, i finally found a resolution. host: cheri, as you look to the field now with his departure, what does that mean for the other social conservatives, the evangelicals? guest: there are some candidates in there. i think there are several that could actually have an impact. i think we will eventually end up with a governor or former governor, which think will be a good choice. then you have people like

michelle bachman. on if they feel like some issues will be ignored the evangelical base is being ignored, they will push them front and center. we will see these as republicans get into the primaries and decide what issues are important, what will be the second-tier issues, etc. the evangelicals are an important part of the republican base. the issues that are important and will remain front and center. host: two mets, one dilemma. it was difficult not to feel pity for mitt romney.

guest: oops? part of the problem with romney is not just the decision on health care and what he did in massachusetts. it also is that this plays into a narrative that plagued him last time, that he was a flip- flop for. he said one thing in than state of massachusetts and when running for the presidency changed his position. it plays into the suspicion of that him that maybe you cannot trust him. that is a hard thing. you can explain away various details of policy, but if people do not trust you and do not believe it is a genuine shift in opinion, they will not support you. that will be this issue throughout. host: "the burden of romney-

care." guest: he has a problem with this, obviously. people may look at him as a flip-flopper. we saw that affecting john kerry negatively when he ran for president. it depends on how for giving the bases. he has been the front-runner. people know him. we have some other people coming up that could overshadow him, but this is a problem for him. we will leave this up to the states and he is tap dancing around it. will that be enough? that remains to be seen. i expect it will be a bigger challenge than, certainly, they had hope your thoughts. and is what it is. they were hoping it would not come to this, but we all knew that it would. host: recovered his speech in an arbor, mich., in which he

detailed his plan and criticized the president's plan. here is more with governor romney. >> i also recognize that a lot of pundits around the nation are saying that i should stand up and say, "this whole thing was a mistake." that it was beheaded and i should admit it was a mistake and walk away. but i'm presuming lot of people think that be good for me politically, but there's only one problem with that -- it would not be honest. i did what i believed was right for the people of my state. i would describe for you now what i think would be right for the people of the united states, which is quite a different plan. host: then karen, a power point presentation that included 25 programs. guest: as a bing consultant, i would expect nothing less. he was not wearing a tie and he was trying to show that he could

be the casual businessman, i suppose. again, there is the question about authenticity. who are you really? what are trying to tell us? what are you trying to sell us? that is part of an romani's issue. -- romney's issue. his plan is the obama plan, despite what he says. host: a democrat from wisconsin announcing he will not seek another term, leaving another vacancy in a swing set date for the president in 2012. -- a swing state in 2012. 10 republican seats up. this headline this morning from "the new york times," -- "a reason for optimism in regaining senate dominance." guest: that without a complete surprise. people knew that was a real possibility.

so wisconsin, for many reasons, this whole year, but especially for this one, wisconsin will be a real focal point in 2012. it is a swing state. you have a lot of up-and-comers that might run. paul ryan might run, but i doubt that. i think he has such a strong position and a great national position with chairman of the budget committee and so much he could do, i think he'd have to back-burner that to run for the senate. but we've got some other candidates there and you've got a democratic lineup. feingold could run again. tammy baldwin looks like she wants to get in but i think there's a real possibility that this could be a g.o.p. pickup. things are looking good. there's momentum on the g.o.p. side, it's still early, but there's lots of reason for optimism. host: you have montana, nebraska, north dakota. these are conservative states, democratic seats that are very much in play.

you have an open seat in virginia with george allen, and tim cane vying for that, assuming that governor allen gets the republican nomination and have you states like massachusetts where you have a republican incumbent in a strong position to win another term. guest: in massachusetts, the governor is very vulnerable. he's suffered criticism from his own base. one thing i wanted to say about wisconsin, i was surprised that the sort of common wisdom of the pundits was that somehow this would be a republican pickup given that the g.o.p. brand in the state of wisconsin has been so destroyed by what scott walker did that you have the reagan democrats essentially ready to come home recognizing that this is why they were democrats in the first place, so i actually think there is a better opportunity this cycle for democrats, particularly if we have a strong candidate to hold on to that seat, than you might have seen in other years. >> and cheri jacobus, you have

senator lugar who is seeking another term for the first time since 1976, challenged in his own primary. he is 79 years old, running on moderation in immoderate times, is the front page below the full story in the "new york times." guest: we're still having these fights with tea party candidates and others making things difficult. but interesting, and that is a democracy. i imagine it will still have an impact in 2012 as it did in the last election. there will be very positive things that come from the tea party -- it's not a party, obviously, but the tea party folks, i guess, as we call them, the tea party voters -- and we're going to lose some. i think it makes it tougher for the incumbents that have been in for a long time and they have to defend themselves and fight for their positions. it's not a bad thing. i personally don't mind having those fights. i don't think anybody is owed a seat and i think a primary is a

perfectly good place to have some of these fights over the big issues such as the budget and other fiscal issues and the debt and the things people should care about rather than the birther issues and things like that. host: we'll get to your calls and comments in a moment. the "national journal" focusing on winning immigration. the president talking about immigration last week in el paso, texas, and administration officials telling reporters that they expect texas to be in play. how realistic is that? >> i think it's very realistic. both texas and arizona. we came very close and the thing we've seen in texas from the time i was at the d.n.c. from 2005 to now, really big changes in not just the demographics of the state -- obviously, the latino community very prominent and an important voting block -- but also, within the democratic party, we've seen kind of a revolution, if you will, and they've really reorganized

themselves so i think it's actually very possible and again also in arizona where you have a large latino population and we came very close in 2008 so i think both states will be very competitive gompt -- do a: republicans have better job in outreach and communicating the message of the i think the issues are there for the most part. everything is not about the illegal immigration issue and you can't assume everyone of hispanic origin, legal immigrants, are going to vote on issues. there are a lot of issues that are republican that the hispanic community should be interested in but my party has to get it together and reach out to them and do it quickly. some of those might be socialoshes abortion and the issue of life and education issues and jobs and everything we can do for the hispanic community but aren't speaking to that segment of the population as effectively as we could or should.

guest: i wrote a piece for the "hill" this week on this issue. if you're a 2012 republican hopeful, this is an issue you're terrified of. you don't want to see the demagogueria that we saw and the rhetoric that got very much out of control in 2005 and 2006, which meant a lot of hispanic voters left the democratic party and went to the republican party, and it's not just about appealing to them on social issues but the fact that you're an alien and there's something about you, that turns people off to the republican party and that has been part of why the republican party has seemed and felt less welcoming to minorities so the g.o.p. has to not only lock -- look at those issues but also look at the rhetoric. the more the party pulls to the

right, i can't imagine any presidential candidate wants to talk about changing their birth right as citizens. guest: i think the republicans need to fight back against those type of problems. nobody has a problem with legal immigrants, we all come from immigrants. this is the greatest melting pot and i don't think anybody has a problem with that. that's what makes america great. but it is important to differentiate between legal immigrants and illegal immigrants and sometimes the rhetoric mixes that up and republicans have not been good of dealing with that but it's about the rule of law and as americans we're proud to be americans no matter where we come from and that's a good message but when you have people coming in illegally when you have so many others who worked very hard to get here as legal citizens, that needs to be the talking point. too often republicans allow

themselves to be called racist and let the lines be blurred between what we're talking about with regard to people who are here legally and become americans and those sneaking in illegally and just because there's a shared ethnicity does not make them the same. you have people who are here legally and people breaking the law. it's as simple as that. host: our sunday roundtable with cheri jacobus and karen finney. bill is joins us from pennsylvania. good morning. caller: good morning. i'm looking out the window and there's a hummingbird out here and i think people need to connect to nature more instead of technology. everything we come up with in terms of technological entertainment require energy. when i was a kid, we played outside. we didn't have electronics all

the time and we walked to school and i think we're always promoting the consumption model and we need to look at what's conservative and exploiting all the resources in order to fulfill our wants and desires isn't really conservative and we have to look around and do simple things like planting garden and walking to school and being more community minded. it's all these high energy prices do anything that's going to be good, maybe it will bring people back to urban cores to where they can walk to the store and get to know their neighbors and a political point, too, i think unfortunately the political process is broken, that we have the best government money can buy and oil companies don't have allegiance to the country. they gave away most of the oil from 1900 to 1950, we exported lots of oil. we were the sexual battery of -- saudi arabia of the world. only gave it away for $1 a

barrel. guest: listening to the debate about oil and when we talk about global climate change and how we get off of oil and look at other models for a more diversified energy model, one of the things think is very sad is that in that discussion, the idea of being conservationists and caring about the environment has gotten lost and sort of almost as a negative because we're focused so much on sources of oil or other sources of energy and he's right. we need to be more conscientious about how we conserve the earth. host: bloomberg "business week" pointing out that the oil sector has a 41% increase in earnings from the year before. we had the hearing where energy and oil executives getting tough questions from democrats, support from senate republicans including orrin hatch but how

does this issue play out when all of us are playing $4 a gallon. guest: when it's $3.99, we don't change our behavior but when it hits $4 a gallon, we our behavior. psychologically, it has a tremendous impact as much as economically. host: what about politically? guest: you have the president up restrictions in the gulf on drilling and he's going to take flack from that from those on the left but he's facing the realities about what we need to be doing. but again, is it hard to watch for americans to watch the oil company make a lot of money? certainly. but i think what we really care about are those measures that are going to be lowering the price or holding the price of gas, that we have to -- we drive by and see those signs every day of the rising gas prices and that's what people care about.

president obama siding a little bit with republicans now and easing up on drilling restrictions, that's not going to have an immediate effect on the prices, everybody knows. but at least republicans and democrats are coming together a little bit to do something in washington that's going to down the road and i think that's going to go a long way in terms of americans having a small bit of faith that washington can do something about it. host: to your earlier point about the tea party, tawny, from new jersey, said republicans are supposed to grow the party and instead have narrowed it. how do you win if you buy that argument? guest: she's talking about growing the tea party? the republican party. guest: the tea party voters still vote republican and they have an impact butung -- i don't see any evidence that they're shrinking the party. i do think that we have to -- we've been forced to recognize and pay attention to the issues that are important to the tea

party. i don't think that's a bad thing. on the economic issues, i think it has a tremendous impact and those will be the issues we focus on in 2012. we see evidence of of that already in the primary. it's the fiscal issues, it's debt, it's spending, it's the budget. that's what the tea party cares about and if they stick to that, they'll still have a pretty big impact and i think republicans are listening. host: karen finney? guest: i think it's the opposite. you look at the potential presidentials, the fact that what they have to do to get through the primary most likely means they won't win in the general election. when you look at what john mccain had to say, in the election, people said they didn't know who he was. one of the things the republican party has done a poor part on, the youth vote. 62% of 18 to 29-year-olds voted democratic. that's the first time more young people voted than seniors.

now with the fight that the g.o.p. has taken up with the aarp over healthcare legislation, they're on the skids with seniors. so i think what you're seeing is a shrinking party that is increasingly beholden to the far right base. look at discussions wove -- we've had on the budget, we're in, we're up, we're down, where boehner is trying to please all these masters and being led around by the tea party. host: don from sumter county, good morning. caller: what i wanted to talk about was the citizens united decision and how it's distorting elections. my examples being all the money the g.o.p. dumped into the wisconsin races with feingold and the governor there, the rejection of the ryan budget, and all the support it's getting and how it really works is let's use frank lutz's focus group on the republican first debate. i mean, talk about focustry,

what total control of results did frank put out where he had a unanimous panel and i think steve colbert will have fun with the super pack and that why once again this weekend is 10 out of the 12 guests on all the talk shows republicans. i mean, you got presented the lineup on c-span radio earlier and what kind of representation is that? i just don't understand. and i'd like to hear what the ladies have to say, thank you very much. host: regardless, we'll help you listen to some of those sunday shows on c-span radio at noon eastern heard coast-to-coast on xm channel 19. all the republicans running and one democrat. but with regard to citizens united and the money in

politics, the democrats have recently come up with a plan of their own to start dumping that same kind of money into the races so if it's something that's offensive to people, both parties of equal opportunity offenders at this point but there's no question that campaigns are expensive, very expensive. there's also no question that every person in this country who's 18 years old, they have the right to vote. so this is a matter of citizens may be taking time of their own in deciding who they want to vote for and maybe if they weren't so affected by all the money and could find out what they want about the candidates, we wouldn't need that. that's in utopia and sounds very pollyanna but the money is there and that's a fact of politics, like it or not. it's like complaining about the weather at this point. host: one of those republicans is congressman ron paul. he ran in 1988 as the libertarian nominee and in 2008

as the republican candidate and he's running again. we caught up with him in exeter, new hampshire, on friday. >> there are many who would like to belittle this effort but let me tell you, there is an old saying, three's a charm. the conditions have certainly changed even from four years ago when i think back on the first year that i came up here, it must have been end of 2006-2007, the atmosphere was a lot different. there was an 2006 election, 2008 election, and it did not make all of us who believed in liberty all that happy but boy, i tell you what, there has been a significant change. the people have awoken and they have sent a meanwhile -- message, elected a lot of new people to the state legislature and i am convinced that the spirit of liberty is alive and

well in new hampshire. [cheers and applause] host: that is on our web site at c-span.org. karen finney, he is popular among the base of the party, why? guest: there's also a story that he's popular in his own district and i think people like the fact that he's a straight talker, says what is on his mind, legalizing heroin, if you agree with that, fine. but i think people are refreshed with the fact that he's willing to take on democrats and republicans based on what seems like a very pure sense of what he believes is right and what he believes is not right and again, whether or not you agree with him, i think it's more that level of honesty and sort of that straightforward conversation that people respect. i just don't think they see him as president, is the problem. host: joe joining us from savannah, georgia, with karen finney and cheri jacobus at the table, good morning, joe. guest: good morning. i want to say one thing that

most of the presidents always wait too long to cure a situation that they know that's going to happen in the future. now we're talking about oil prices. we're talking about inflation, which the government produced inflation, the first time the government ever produced an inflation in this country. and then on the other hand we have the fuel prices. every time a truck moves down the road to bring a product on our marketplace, it costs him $400 to fill that truck up just to go 100 miles -- or 400 miles. host: your point is what? caller: excuse me? host: i'm trying to get what your point or your question is. caller: the point is, we have an inflation that is so high right

now at the grocery stores and our marketplace, if we don't bring the fuel prices down to a normal operating cost for truckers, we will never get this country stabilized. host: so turn that in terms of the 2012 election, if gas prices are where they are next year, if inflation is creeping up, what impact will this have on the president's re-election? guest: right now we've seen the president's bump from authorizing the killing of osama bin laden has gone away and we're looking at it in terms of economic issues. host: which is not unusual. guest: it's expected, which means these are the issues that will be a big part of the 2012 election so republicans need to clarify and stick to their message and do a very good job of talking in terms of jobs and making the job creators in this country have an environment where they can succeed. and that's going to help

everybody, so when you are over taxing employers, when you're over taxing business and putting out all of these regulations so they can barely do business and can't hire people and can't offer benefits, that's a real problem, a huge obstac toll economic success in america so i think republicans really have the upper hand in terms of articulating that message because if you can create businesses and create an environment where businesses can thrive and succeed, everybody wins. once you strangle business, we get into some of these problems and gas prices are going to be the constant reminder like the wal-mart sign in their ads where the price guess up and down. host: in 1991, george herbert walker bush, his success in out offing saddam hussein from

kuwait and both lost their re-election bids. guest: i think the bump that the president got out of the killing of osama bin laden wasn't expected to last particularly given that we're in a tough economic climate. what i found interesting in some of the things cheri was saying, if you care about small businesses, you would never play politics with the idea of raising the debt ceiling or not. if we default on the debt ceiling, that makes harder to get credit, it makes it harder for small business to have access to credit and loans for individuals and college loans so there are a number of things i felt if that was a sincere concern on the part of the republicans, we wouldn't hear some of the rhetoric we're hearing. that being said, the economy will be almost like a third candidate in the race because while it is true we are moving in the right direction, it's still not felt by enough people and certainly with the gas being as high as they are, one of the things, in addition to what the president was talking about with regard to

drilling, he's the one guy who's been saying all along, we need to have a comprehensive solution and we need to start doing a lot of these things now because of the future and i always think back to jimmy carter with the turn it down and put on your sweaters. if we'd have implemented some of the ideas he had, we would be in better shape than we are today. we have to balance between the short term and long term and that's hard in a tough economic candidate. host: newt gingrich, another candidate in the race. he announced it on twitter on wednesday and delivered his first political speech on friday in macon, georgia. >> president obama is the most successful food stamp president in american history. more people are on food stamps today than at any time in american history and he's proud of it. i would like to be the most successful paycheck president in american history.

[applause] and i'd like the voter, the last thing before they vote, one of the questions they have ask, one of them will be, do you want a future of paychecks or a future of food stamps? host: comments from newt gingrich, former house speaker. we'll go to charles who has been waiting in las vegas. good morning. caller: i just moved from d.c. where gas is $5 a gallon and i want everyone to understand the most important reason" $5 a gallon g.on youtube and find the quote which i'll give you verbatim. "of course, my policies will cause energy prices to skyrocket ." find that quote and you'll understand that that's the number one reason. he knows that alternative energies are not economically viable, therefore he's racing the price of fossil fuels in order to make alternatives more

competitive but they'll never get there. he loans $2 billion to petro gras and his friend george soros so they can drill in deep sea whereas we have been probated from that for at least a year and maybe more. host: we'll get a response. guest: i don't think the president is intentionally trying to raise the price of fossil fuels. there are a lot of things that go into it. it is the achilles' heel no matter who is in the white house. much of the rhetoric i hear obama are theent same talking points we used against president bush. there is a limit of things you can do to bring prices down but we have to have a vision that understands that in the future we cannot be so reliant upon foreign is -- sources of oil. we have to have a comprehensive energy mix that looks at a wide range of options and makes them

viable and i think most people understand that. and i think that's just our reality. i think if we don't, we will continue to be held hostage to events in the middle east which i don't think any of us want to see in the future. host: one of our viewers has this question based on a pete sieger video. it's pete sieger with a question, which side are you on, available via youtube. and we'll play part of it to get your response. that's the question the president is asking. guest: i think the election will be well the economy. people understand balanced budgets and know washington isn't doing it. they understand that we're leaving huge debt and problems for our children and grandchildren, the next generations. i think people get that. i think this is why it's going to be i strong argument for republican governors and former

governors who have been able to balance budgets and reduce deficits within their states, have been able to get the economy under control, have been able to lower taxes. you have mitch daniels who really lowered property taxes in indiana and capped it in the constitution. those are the types of issues that will be great talking points and the great debate in this election. when you have people with executive experience, governors who have done this in their own state and know how to have the conversation. they know how to fix things in their own state and know how to fix things nationally. when we talk about the economy and whose side are you on, the side of people who want to live off the government or are you on the side of people who want a strong, robust economy, who want jobs and don't want to leave debt and problems for the next generation. guest: the major problem i have of late with the economic conversation, even newt gingrich talking about people on food

stamps is in general the g.o.p. never wants to talk about how we got here. it is not a mistake how we got here. we had several years of a republican controlled congress and republican president who essentially tanked our economy and after the killing of osama bin laden so many people who have been running away from bush for years ran to the microphones to make sure that the ba -- bush administration got credit for the twork -- work it had done. you have to give the president credit that taxes are as low as they've been for most americans and you see story after story of major corporations not paying taxes i'm not sure how you can say that taxes are so high particularly when republicans voted 16 times against tax breaks for small businesses so when you look at whose side are you on and who is.

>> um [inaudible conversations]

the hearing will come to order. good afternoon and thanks to all of you particularly the witnesses for being here. this is one of a series of hearings the committee is doing this year as we approach the tenth anniversary of the attacks against the 9/11 and the purpose of these hearings is to examine how well with national security reforms implemented in the wake of 9/11 are working. this particular hearing of course has been held in the aftermath of a spectacularly successful collaboration between the intelligence and military agencies locating and killing osama bin laden the al qaeda leader who presided of course

over the 9/11 attacks on america. this success required intense and focused cooperation among the key intelligence agencies and the defense department as well as other related agencies through of the government. each organization as we go back and debriefed on this mission brought its distinct assets and expertise to bear on the mission which was to locate bin laden and then to capture or kill him and when it comes to intelligence, sufficient material was brought together to reach informed conclusions with a level of confidence that enabled the president of the united states to make a tough call but one he felt the evidence enabled him to make the size of the result of this

remarkable success. i don't believe that all of this would have happened ten years ago. in fact, in the report of the 9/11 commission the author expressed frustration that as they reviewed the government at that time no one was actually in charge of the hunt for bin laden which symbolizes to the commission that this function and the disunity that they can conclude ontributed to the 9/11 attacks in the first place. in response to the 9/11 commission criticisms this committee drafted and congress has the intelligence reform and terrorism act of 2004. there is -- there was then and still is today another body of congress called the house of representatives and there was another committee that drafted similar legislation headed at the time by one of the three

witnesses, congresswoman harman. a result of the most sweeping intelligence reform since the creation of the cia after th second world war. i think the most important reform in the 2004 act is the creation of the office of director of national the intelligence with the aim of bringing together coordinating the efforts of our 16 intelligence agencies and offices under one leader to make sure they work toward a single goal of collecting and analyzing intelligence to better protect our national security. so, the purpose of the hearing today really is to take a look at how the zero dni is going to inude the rest of my statement in the record except to say that

i am grateful that we have the witnesses that we have before us day. really three people paricularly well to assist us in answering questions we are posing which is how has the odni money and what if any statutes of limitations are necessary? i mentioned congresswoman harman was the ranking member of the house permanent select committee on intelligence where she worked closely with us as i sit on the to those in fort she chaired the homeland security subcommittee on intelligence information sharing and terrorism risk sessment and has now gone on to be the head of the wilson center which she is already doing a great job. general michael haydon, former direor of the central intelligence agency, former director of the national security agency, former deputy director of national

intellence really a great national asset to help this committee in its deliberations and former assistant director of central and intelligence for analysis and production. and really one of the nation's top experts on intelligence analysis. we think all of you for coming today. we look forward to your testimony about where we are, where we need to go to ensure that our intelligence community consistently performs at the highest levels, the kind of levels that we saw demonstrated in the hunt foand taking down of osama bin laden. nator collins. thank you mr. chairman. i am going to follow the chairman's the day and also in an abbreviated version of my opening statement. let me begin by echoing his

comment about the distinguished panel that we have before us today. i too am particularly delighted to see former representative jane harman here with us as the chairman has indicated she was one of the four authors of the 2004 intelligence reform and terrorism prevention act and worked very closely with us through extraordinarily intense talks if the negotiaons that spanned several months. general haydon has given so much work and effort to his country and also was the key behind the ausley year as we drafted that bill and of course as the chairman has indicated has had a stellar career in the intelligence community, and i am confident that all three of our wiesses will help us do the

evaluation th we are undertaking today. last week's news that osama bin laden was worked demonstrate exactly the successful collaboration of intelligence and opertions that we envisioned and reforming our key capability in the wake of the attacks on our country men en in 2001. this was a great vctory for the intelligence efforts and a great blow to al qaeda. but the fact remains that al qaeda isn't going away and that is why it is time for conagra's to examine closely and build upon the success that have anated from the intelligence reform and terrorism prevention

act identify a shortcomings and work to correct them an build further reforms. as the chairman indicated, our 2,004 lawcreated the director of national intelligence and the national counterterrorism center to foster information sharing and collaboration among our security partners not only across the federal government, but also tall levels of government. the dni has made some cncrete progress integrating the 17 agencies in the intelligence community. i want to give just two examples of how that integration is taking place. they are not the kind of examples the public is generally aware not but when you talk to those working these frequently comeup. in 2008 the dni ruled out the

innovative state which is an intelligence anast facebook but instead of being used for social networking, our intelligence experts are posting, sharing and asking each other about topical issues. they can collaborate with colleagues across agencies and the world helping them to share leaves and resources more easily than ever. a second example is the national counterterrorism center's creationof the puruit teams that met terrorist networks, track threats using information from across intelligence agencies to bridge the gap between national and domestic intelligence and help to put the pieces of the intelligence puzzle together. those are just two examples of innovative ways the stovepipes have been broken.

i copletely agree with the chairman that i doubt that the kind of integrated operations that were successful in going after osama bin laden could have existed a decade ago. so i think that we have indeed made progress. and there are other examples as well. the unrest of mr. zazi and mr. headley are two other cases where the dots were corrected. on the other hand, this committee has investigations and reports on the fort hood shooting hair show the we still have a way to go in other areas particularly in the information sharing between the fbi and other members of the intelligence committee. we concluded that the dod and the fbi collectively had sufficient information to have

detectedmajor passan's radical islamist extremism but that the department of defense and fbi field to act effectively together on the many red flags signaling that he had become a potential threat. so the bottom line is almost ten years since the attack of september 11th and 7 years since our landmark legislation, our nation as much safer, but we clearly are not yet safe, and that's why it's incumbent upon all of us to reevaluate the mall and to look at where we are and where we need to go. finally, let me and with one comment that seems to be of concern to me. when we drafted the intelligence reform act, we described the dni

as the quarterback that the 9/11 commission envisioned and that we intended. at a were earlier oversight hearing the two leaders of that commission, governor kaine and congressman hamilton made the point that some of the functions we envision th dni carrying out are being done by john brenau of the white house, and that troubles me not due to any doubt about mr. brennan's capability but because that structure undermines the statutory role of the dni. so a basic questi we adjust and is whether changes to the mall are equired or whether it is simply a matter of more fidelity to the spirit and the letter of the 2004 law in order to realize the potential of the

dni. thank you mr. chairman. >> thank you. well said. congresswoman, it's great to have you here on the other side of the table. welcome back. >> thank you. i'm not ed to be on the other side of the table. you and i and senator collins and pete hoekstra or at the same table day and night as we crafted what is now probably the worst ackerman never invented. again it is a pleasure to testify with good friends before dear friends and dedicate former colleagues who serve on one of the most important and bipartisan committees in the senate. i now work in a bipartisan institution and pinch myself every day to be so lucky and to succeed our former colleague lee hamilton at that job. i am passionate about the topic of the hearing. intelligence and intelligence

reform of the focus of my 17 years which is 100-1912 years in the house of representatives. i didn't run and intelligence agency like mike haydon and i wasn't a top analyst like john gannon, but i did try to conduct as you did careful oversight over the function during my eight years on the house intelligence committee and my eight years on the house homeland security committee. i agree with both of you that if 24 or more heroic navy seals deserve the nation's gratitude for the killer of the world's most wanted man last week. the information on which was based drive in most part from the inteation of people and achieved by the intelligence reform terrorism prevention act to those of four. we now have proof, big tie

proof that erpta wks and can obtain this aimlessness that it authors including me dream of. in fact, my view is had we not ssed erpta and had we continued to operate the intelligence community using the 1947 business model set out in the national security act we would probably not have been able to thwart a number of plots or to take down osama bin laden. let me focus brief on three issues. first, both of you have been addressed the performance of the director of national intelligence, the dni. by the way i take credit for the name of the dni. originally it was supposed to be national intelligence stricter, nid, which i thought sounded like a bug. >> it's interesting. i take credit for that, too. islamic and i'm the one who actually did it.

[laughter] >> i think we can all agree that pete hoekstra had nothing to do with it. [laughter] >> moving along, second, let me talk about something senator collins mentioned which is the role of domestic intelligen agencies and third some ongoing issues evolving congressional oversight of course not involving the two of you. i think the dni continues to be work in progress. congress intended her or him to be a joint commander. a quarterback is a good analogy, but i recall our modeling this after the goldwater nickel slot that created a joint command acoss four military services and worked very well i believe so we envision the commander across 16 intelligence agencies, far more than a coordinator come

and a job that clearly required leadership skills. erpta is not perfect but i believe it contains adequate authority to give the dni the necessary leverage that she or she needs to get the job done. i' often said that the function is 50% law and 50% leadersh. congress intended as i think both of you said the dni serves as a principal intelligence adviser to the president. those authorities were i think clarified and enhanced when the president, president bush issued an executive order and that was the intention of ngress includg of president bush as well. this has never really hppened. i believe during the bush administration vice president cheney was the principal the intelligence adviser and as senator collins said during this

administration, john brennan, the counterterrorism coordinator in the white house is the principle intelligence adviser. in my view, neither president has adequely valued the dni rule nor has made, nor as either president made an effort to support the mission. this is something i've think congress and those of us who agree with congress should push hard on. it's not to diminish the reputation and powered of the people in the white house who have assumed the role, but we have established a person who is confirmed by congress and accountable to congress to take the job and i think we should push harder to make sure that person has the job. president bush, also, let me mention -- let me raise a few issues that i think are imrtant that the dni is

addressing. number one, the dni has suggested, and i would urge that this happened, that the national intelligence program be taken out of the defense department and added to the dni budget. i think this will achieve more efficiency and promote more accountability. a second come - the issue of right sizing of the dni staff is being handled well d we should move on to other topics. we should also by the way reduce the use of outside contractors. third, when general petraeus moved to the role and i assume he will and the cia director panetta becomes the security fence hopelly we will finally cement a good working relationshipbetween the cia director. this was impossible to doesn't for because defense rumsfeld opposedthe law and duncan

hunter also did. we had to work around them to achieve what we did, and i thought it was pretty good. finally, the dni clapper urges the we reduce the number of reports to congress. i know how those reports began to statutes and i know what they mean politically to the members who have them but i think consolidating them will save time and resources and enhance the focus on the mission. i want to keep to my time so let me move to another subject and that is our domestic intelligence agencies. i think senator collins said there are ongoing problems with the vertical intelligence sharing, this is going better especially because you're doing so greater oversight and the fort hood massacre as you said to have perhaps been prevented if there had been better collaboration between dod and the fbi, and the especially weak player is the intelligence analysis function in the

department of homeland security we need much more work and i want to think the stuff and you for the work you did on helping to pass for the or classification bill last year which was signed into law by president obama in october. finally, on congressional oversight, your committee has far more jurisdiction than the counterpart on which i served for eight years. but i don't believe any committee in the sena or the house has adequate jurisdiction. we know why this happened. no one wants to give it jurisdiction but i actually think that reorganizing this function in the congress would carry out a strong recommendation of the 9/11 commission that number to give a better shot of providing the oversight necessary to be sure that the intelligence community will get the job done and help us protect our homeland. i agree with senator collins that will last week's news is fabulous it will not diminish

the threat to the homeland and it probably will not diminish the potency of al qaeda although the potency i believe will now move from pakistan to other places like yemen where al qaeda and the arabian peninsula is emerging in my view and the part of al qaeda doing the most work to inspire people to attack us in the homeland. of let me finally conclude by saying that there is no way to make our homeland 100% safe. what we can do is minimize risk and we are doing that. we need to constantly reevaluate the threat against the united states and prioritize our investments. we are not making a lot more brain cells and those we have have to be applied against the top threats and surely we are in a resource crunch and resources must be carefully marshaled.

let me close by recognizing the heroically brave women and men of our intelligence community who put their lives on the line every day for the country often in ostia places around the world living apart from their families. surely the cia director panetta and the dni clapper and some members of congress and others and president obama should take a lot of credit for last week's acvities. but the true heroes were those in the field not just the navy seals the those in the field who put together the clues that led to the information come attract the careers at found the house that john osama bin laden and they deserve a heartfelt thanks. >> here here. thank you. that gave t president a sufficient level of confidence in the information he had to

order. thank you for the excellent statement. it's good to welcome you back. good for being here and we look forward to your testimony now. >> thank you mr. chairman. good to see a lot to begin. let me begin by attempting to scope the problem. we sometimes look as if we are trying to epair a community there was dysfunctional, and what i want to describe is i think what the legislation attempted to do is to balance two things both of which are virtues and two things which in complex organization has to balance and that is simply unity of effort for the whole and autonomy of action for the poor and those are good things, both need to be protected, and i think the macrojudgment was more than a brick shy below when it can to the unity of effort for the whole and that was the intent of the legislion. the problem is i think what we are trying to do is to build with some of our young guest

analysts describe as a network organization which very frequently looks and acts like it is leaderles or has many leaders and the only way we can get from here or there is to have strongleadership in order to create this kind of organization. and so what the nation decided in you have fostered in 2004 is another path to the balance, not the d.c. ausley -- dnr i. i think that in the committee we were nervous about that and quite busy at that time. we thought it had a real authority and did provide roughly a fair amount of blue but even those who had our doubts recognized that if we needed more blue and unity of effort to the then current model was probably going to be inadequate simply because it had full-time work as the director

of the cia and would be very hard for anyone almost superhuman to kind of reach above that role and both psychologically and physically play theole of cushing the entire community. but you have a real daunting challenge because whatever blue we had in 2004, whatever forces we were able to create in the community can from the fact that the head of the -- community headed the cia and he was in the court position inside of the community and of course the decision was made whatever the dni was going to be he wasn't calling to have his office at langley let alone run the cia. so he had a difficult challenge to kind of pull us out of this course, put us on another and put enough bricks in his backpack he had enough authority

to get beyond what the old model provided. beyond that is it's substantially difficult as it was this has been harder than it should have been. we were ed war and therefore it's kind of hard to restructure when your daily tempo is so important but there is another i think more subtle challenge because we are at war. those big organizations to care a lot about, and most of those first initials aren are in the department of defense and as mentioned i was the director of nsa and i wouldn't say we were schizophrenic but we did have a depravity and other personalities. we were the national security agency but also directed to act as a combat support agency to read in many ways, your law is trying to strengthen the national character to bring organizations under the director of national intelligence.

it is inevitable that after nine years of war the combat support character of those organizations become more and more. there's nothing wrong with that, that is a good thing we would all agree and foster it, but it's not quite a convergence on the course of action you set out in terms of strengthening the dni. there are other the next and it is harder. we have had four in six years. that can help. we have had for dcia and that can help either. i think one of the most powerful phrases in the legislation is the rule that you gave to the dni to recommend to the president the dcia. i just told you we had four and four. i can think of only one example where the dni recommended the head of the cia to the president of the united states and the was john negroponte recommended me instead of his deputy and we overlapped for only six months

after i took the job. it's actually pretty important. finally, and i am fearful of being preferential here, my job as the principal deputy i think is important because the two tasks you gave to the senior intelligence adviser and the president and the functioning to the community, those are really hard and the deputy function is really important. for over half the life of this legislation that the deputy position has been vacant. that has a real impact on i think as you said, senator collins, affecting the intent of law rather than trying to change the legislation. now, all that said, i think there's been some really good news with regard to the dni. number one, it exists and is accepted and frankly in 2005 when i was the principal deputy that wasn't a given throughout the community. the in ctc has been measured as

a success and there will be questions as we go further. imagine if you will chongging to create the nctc which is characterized by foreign intelligence with domesticaw enforcement. try to picure that reported not to the dni but ithe reported to the d.c. i andwas your former espionage chief american political culture would have rejected that like a foreign object and so the dni structure has actually enable the success of the nctc. the dni is also filmed from time to time in front of the trains. i can recall director mcconnell spending eight -- 18 months on legislation you are familiar with. that couldn't have been done by any sitting director. only the dni could have brought the gravitas of the community to

that discussion. this sounds a bit personal but it's a very real. every day i was there i think god that there was a dni. i had no idea how anybody could be there and be the head of the american intelligence community. we talked about the recent success and you used the term quarterback. i think i'm a little bit more comfortable with the term coach to describe the dni and i think it's clear why wasn't on the inside but from all of the accounting i think it's clear that the director panetta was a quarterback for this effort. there is an echo of that if you recall the cerium nuclear reacr the was ultimately destroyed when that came up director mcconnell and i worked very closely but in fact she is empowered me to act on behalf of him because this was at the operational level, and i don't know the we want the dni

routinely played at that level. there's other things they set in motion, sharing 502 which sounds like coded nguage to most folks in the room but it's a process which allo over time the bureaucracies to more readily share information. joint duty is another thing that's been set in motion and that over time will change the culture of he community, not possible without the current structure. there are some tinkering sentel that someone might consider. i will not suggest any. that should come out of the sitting dni bu some things that come to mind if there is anything you need to do to get the national intelligence program more fully under the dni and out of the budget, there is some legal impediment i'm not aware that probably a very good thing. we've already mentioned we are cooperating pretty good east to

west at the national level. but the new thrift will require more cooperation from north to south and how better to we should win the national, state, local, tribal assets? i don't know that there are legal impediments, but if there are i think the would be a great help to rebuild that said i think i agree with something both of you suggested. we are going to succeed or fail moron tangibles than on the precise litter of the law as important as this. the most the come to mind or the personality of the dni. that really matters to that person is. second is the relationship with the dni to the dcia. it's got to work. my shorthand is the dni of the dcia ruined the run and the dcia total transparency. then finally as it is already ggested whatever shortcomings there may be in the lock

everything is fixed. if the dni is and everyone knows him to be the president's senior intelligence adviser without question. thank you verymuch and i yield to the questions. >> thanks, general peaden, there was great. thanks again for being here. please, proceed. [inaudible] if he could hit the microphone. >> there you go. >> thank you pure in my view for all the performance of the u.s. intelligence community h improved dramatically since 9/11. analytical tradecraft advanced significantly performance counterterrorism programs has reached the highest standard of professionalism and dedication. the application of technology has broadened, deepened and accelerated. interagency collaboration especially in support of the

fighter has improved remarkably. in progress towards the more distributed model of intelligence support to users anywhere in the world is palpable the fusion of intelligence and well-trained people and advanced technology and the interagency team work and afghanistan and iraq are at the highest level ever that seemed unattainable when i left the government. the creation has been contributed significant to this progress will the leaders and individual agencies with administration's congressional pport also have taken the steps on their own. the department of defense when congreional proval to establish and to those into the position of undersecretary defense for intelligence to improve management of its considerable intelligence assets and programs. significantly in my viewhe secretary defense elevated the authority and the budget of the joint special oerations command to provide in the field a strong coalescing leadership, kirchen of command and a powerful authority to coordinate the focus requirements for intelligence collection and

analysis by would risk the whole side judgment that the cooperation of the cia including the counterterrorism center has never been closer and more effective. there is always room for improvement intelligence business, the strong club of performance of the agency's is unprecedented in a source justifiable to the inteligence community. the domestic picture in my view is next. the difference with fidel ranges there is no counterpart in the homeland to integrate the intelligence process these. the fbi has built an impressive intelligenceifrastructure and shifted significant resource once devoted to more enforcement to domestic intelligence collection analysis. the national counterterrism center has made significant progress in integrating foreign and domestic intelligence analysis. the department of land securities was 22 constituents agencies sometimes taking initiative on their own has made commendable strides in our border securit and some but uneven progress in sharing

threat based information in coordinating policy with state and local governments in the private sector. overall however domestic agencies do not show the strong unity of effort that is evident abroad. in my judgment it is a much slower work in progress. the dni should be seen as a leader with explicit response of the lease for clearly defined selected oversight performance for the development and application of integency program standards and for the implementation of the national intelligence program. we are not yet there in my view. i believe however we can do better. we should recal that the erpta was passed after decades of debate about the success of tci to manage the community. today it is challenged by historic political change of leaders first threat environment and technological revolution that is enabling even minor adversaries to hurt us as never before. the dni has the potential to

help agencies achieve a unity of effort in this challeing environment. to be optimized, the dni rules and responsible these should be tied clearly to defensible strategic priorities and requirements. the leadership must be afforded it with regard to these priorities but not intrusive in the agency specific matters and mustecognize the distributed network nature of intelligence supporters of the world today. and most importantly in my view the incumbent must have the visible and sustained backing of both the white house and the coness and it is questionable whether the dni has this now and this in my judgment has been a major obstacle to progress. they needed additional authorities i believe his management of the national intelligence program would be strengthened if it were removed from the defense budget and a

purple of tightening budgets he will need clear authority and powerful top cover to evaluate and prioritize the key programs for growth, reduction and elimination it will he has a unique potential to perform. at this juncture however rather than simp that authorities are believed there would be more useful in the period of leadership transition toake a step back and consider ways to get the inelligence community, white house and congressional priorities aligned to enable and support this hazardous mission. i would say several priorities areas in addition to the management across the agency program as i which the dni is uniquely positioned to help improve the performance and enhanced the u.s. national security. balancing strategic tactical collection and analysis which in my view has swung too far in the tactical direction to recruiting trained analysts for the information age giving greater and full internet access to

social media and outside experts essentials against the challenges we face today. and strengthening the commitment to science and technology in the area where subject more than ever to technological surprise. enhancing training and education for the inlligence profession that is with a curriculum that codifies and conveys the body of knowledge that defines the intelligence profession itself. that insecurity counterintelligence in the 21st century, pursuing the benefit from innovation and avoiding the costs of doing it the old way and continued promotion of information sharing across all the agencies and improving intelligence strategies and policies as well as the government contract -- improving government contract management overall. i'm glad to say i am aware that the dni is working all these important areas but in my

judgment it will need help to deliver the best results the and it shouldn't matter -- should matter to all of us that he succeeds. >> thank you. door statement and the others prepared will be part of the record and we appreciate the time and thought that you gave to your statements. we will do a seven minute round of questions here to the general haydon, i want to start with you picking up on one thing you said, reminding us that the dni has two major functions. one is to be the senior intelligence adviser to the president, and the other is to be whatever term we chose, coach and manager, leader, quarterback of the intelligence community. you've been close to the functioning since it can to affect and first one to say you're absolutely right one of

the shortcomings the last period of time which is not into law but its implementation is that for too long the principal deputy commission has been vacant and that means either we are putting these two functions in a very burdensome way on the dni himself or he's not going to be about to -- either do both not as well as they should be done or fulfil one and not do as well as he should. how would you assess the function of the dni as the senior intelligence advisor to the president in practice? in other words, we talked about this a little before. the cia is a big agency that the lot history and a lot of assets so that's the muscle they have.

but from what you know, you can't talk about it from the inside but has the dni created since created the senior intelligence adviser to president? >> writing it's gone back and forth. it depends upon the personality of the president, the personality of the dni. the first thing is the dni has to choose where he's going to shift his weight. as he shifted downtown? that's frankly have to raw the picture or does he shifted back out of headquarters. there's an incredibly powerful gravitational pull downtown and that is sent out of pride for the dni. that is out of the demd of the president and the national security council staff. my experience to show you how difficult this was, i was generally always there, not in the morning briefings, the was generally the dni show one of the decisions he made it the deputy level, principal level, and i was almost always invited

so i knew there with the admiral mcconnell literally president or stephen hadley would say okay the to mike schogol first and he would talk and then if i had anything to add i would add. we were both of there. the admiral was really disadvantaged and i'm sitting atop the nation's premier analytical service. we are going down with the problem to ensure. at mcconnell is up the road reading books and i'm putting somebody in the back of the car with me explain the details are running down because it got the analytical staffs. so there is a bit of attention, a bit of an anomaly. you have to work through would remember that transparency and freedom of action between the two the bci and the cia have to be friends and the dni doesn't get to to do the job which is smooth functioning into the

community. unless everyone believes he's the responsible one for job one. heains power for the second task from his performance on the first. >> i agree. we wanted the dni to be the principal intelligence adviser to the president because the gathering of intelligence goes beyond the central intelligence agency even though it's -- it has the mt personnel and the most assets in the community. is the presence critically important to this fact? it's not in the statute or is it generally in the statute cracks >> first of all, senator, mr. chairman, this depends on the personality of the president and all presidents deal with this in a different way. president bush was very

we have seen good stories and bad stories. there was a tension between blair and the cia director. it wasted a lot of time about what you call people. -- call people that are deployed in our industries. i thought it was a stupid fight.

it seems to me that the role has never been adequately valued during the time of the law. that is something we should push for. my term, i think the job is to leverage strength to the other agencies. if you're a good ceo, you do not to do all of the work yourself. understand the mission and perform their mission as well and then you put together and that is what i see is the dni role and yes i agree with general haydon that being part of the president's daily brief is important but i don't think the dni personally tested with every time letting other people shiny and have that face time is the sign of a secure leader. >> he said twice now that we ought to be pushing harbor.

in the face of the fact that neither president who is head of the dni has used that to the full extent we hoped. are you thinking additional statutory authority to the dni or is it more to make a point to the president that if we could that this is what we intended and this will serve him better? >> yes. it's the latter. i would think to the extent that our law left any ambiguity, and of course as one of its authors i thought it was quite as well. that was clarified. >> but not without in dignity. islamic in the face of opposition by the to keep people in government at the time i thought we did extremely well. but executive order 120003 issued by president bush and supported at the time by candidate obama as i recall was an attempt to make even clearer we intended the dni to be the

principal actor in intellience. i mean, you can't make a president rely on the somebody in the chair. but as general haydon said, you can try to help forge the right chemistry between the president and this person, and you could also explain as congress that the person accountable to congress for the failure of success is the dni, not the vice president of the united states or the principal counterterrorism office in the white house. >> do you want to get into this? >> just as former deputy director [inaudible] orie regard it and still do and as access to the president and ability to serve the president is absolutely critical to the rule of the senior adviser to

the president. i degette -- by the way, i will add it and i think mike knows this all it takes resources to do that successfully and that is a substantive role that you play in the form it's difficult for managing of the community role and the d.c. i struggled with it and all of them try to do the two things. but i think the problem with of the dni construct is i don't think they have analytical resources to serve the critical role. it takes to produce that is a tremendous and the estimate of resources and expertise and they have to be serving the person who actually provides the briefing. >> so is the answer to try to provide more analytical resources to the dni? >> that would be the answer to the question, yes. i think if he's going to continue to serve in that role he needs to have more resources.

a person can'to it on their own. >> because otherwise this will naturally move to the cia -- >> i think there would be a strong gravitational pull in that direction. >> okay. thank you. senator collins. >> thank you, mr. chairman. as i am listening to this debate, it reminds me that an washington there are three levers of power. one is your relationship with the president, and we talked about the fact and i agree with representative harman that neither president bush nor president obama has fully valued the dni as the principal advisor to the president the way that we intended in the law. the second is the control of personnel and i want to come back to that with an example. and the third is control of the

budget. each of you i believe made a budget recommendation to us when we wrote to the 2004 law it was a big, huge dispute over whether the intelligence community budget should remain with the dod and then be doled out essentially to the agency. so whether it should go through the dni. and i think, but i want to clarify that each of you are recommending more authority for the dni in this area. so if i could first explored the budget issue and start with representative harman. ..

unless there is a bar in the statute by just getting hopefully this president to support a. >> i have been advised that w have been in discussion with the dni about whether there is there is a need for statutory action and they are not sure, so they are coming back to us with an answer and we will reason it together. >> general? >> yes, maam. you have got some tension outside the inside the law on the budget. ever be picked is great, determined is what you decided and then you have got ction 1018, which says nothing

in here of the progress of the cabinet officers of which these officers are located. i'm not suggesting you go back in and use a wrench to change any of that led to the degree you can end the process, foster the dni determines i think that is a very positive thing. in terms of shifting out of the dod budget national and intelligence program into an independent account under the dni think most people look at that will say you would actually strengthen his authority and the execution year which is not a bad thing. it may not do a whole lot in the planning or programming about in the executioner which is where you look around and say who is burningmoney at the rate expected and who is sent and let me ryan mind everybody was my money to begin with and that might be a very positive thing. >> mr. gammon. >> i agree with all that has been said. i think jim clapper is made a persuasive case that i would

have probably agreed with even before he made it, and i think in a era of greater stress on the intelligence budget i think it is important, important and it real terms and symbolically that he have that legit control. >> i was smiling as general hayden was talking about the language, because i remember how difficult it was that we did want the dni to be responsible for determining the budget but in order to get the bill through, i think we did create a compromise or some lack of clarity in order to get the bill accomplished, which sometimes happens so it will be interesting to see if we can perhapclarify that. let me turn to the personnel issue. as representative harman has mentioned at the start of this current administration, shortly

after leon panetta was confirmed as the cia director, the dni, admiral blair, issued a directive in which he claimed the right to select an individual other than a cia station chief to be the dni representative and foreign government. and, this buildspon similar but far lesspublic efforts that were undertaken byrevious dni meg ripati -- negroponte and mcconnell as well but this did blow up into a rather prinent public battle between the dni and the cia rector. and the unfortunate, in my view, outcome was the white house was forced to choose sides and sided

with the cia, which in many ways in my view, undermined the dni's ability to to in the whole area of personnel. so, my question is, who should bein charge of the personnel in the intelligence community in terms of allocating assets? mr. gammon we will start with you. >> first of all in a particular case you are citing in my judgment i think it was badly handled and so the outcome need not have been what it was and i have to believe it could have been managed in a way that the parties of interest of this conflict could have got away with a much better feeling but i think it ended up undermining the dni and did a lot of damage to his ever to establish

authority. i think in the nature of the global threat environment in our country, the need to be able to move assts quickly is critical and i tnk the dni needs to have some authority to be able to move personnel also. so i don't have the confidence to say how precisely that should be crafted into law but he does need to have that ability and i think the dni is the appropriate authority to do it. >> thank you. general hayden? >> yes, maam. admiral mcconnell and i had that very issue for quite a while when we were in ofce and unfortunately the he couldn't get it across the finish line. i recall, this is a very emotional issue for the cia and i was doing my duty in terms of representing and frequently my senior staff would say you just take this to mr. hadley or someone else in the white house. my response was guys, we take this to the white house, we lose. there is no way the white house can support the dni in this kind of issue.

frankly i think the dni was wrong. i think it should be a station chief. i think our foreign partners expected to be the station chief but the i has a right to be wrong without being over ruled and such a public humiliating way by the white house, so i agree with john. it was a very bad thing. in terms of moving personnel around in general, falling back a little bit on the military model commanders talked his commanders. commanders don't command troops inside other people's organizations, so i think the model we might want to think of is to make sure the dni has the authority to demand capabilities of his component commands come his component commander, nsa, nga and cia but to leave those commanders, component commanders to freedom of movement is how they respond and how they create that capacity for the dni wants it but he fully should have the authority to demand capacity where he needs it. >> that is a good distinction.

>> i strongly support that last point and also aee with mike hayden's earlier point that the dni sould carefully pick her his fight and hopefully pick the right fight. this was the wrong fight. all of this beats the conversation we are having and have been having from the start. i felt again given the implacable opposition by secretary rumsfeld and armed services chairman duncan hunter that we did pretty well. we consulted closely with an unnamed source than in the bush administration to make sure we had adequate authority for the dni to build the budget, not just to educate the budget it has moving mone providing money is how you give somebody power and i believe we had adequate authority there.

section 1018 was modified or clarified later by executive order 120 -- 12333. in terms of people, even people for the pdb, ifi were the dni i would use assets that exist at a monthly 16 intelligence agencies to help me do what is necessary there. there are excellent analyst at the cia as we mentioned. john gannon knows that extremely well and they surely were very good at providing information leading up to the capture and kill of osama bin laden. those assets could be used by the dni. there is no prohibition against using them. they don't have to move to different box. i think we should be done with moving boxes around and we should insist that the dni get the respect that hurston deserves and do the job by leveraging the assets of the agencies under her or his command. just one final comment if you will indulg me i so believe that as the

intelligence community more fully adjust the joint model of the military, where in order to advance your career, you need joint service, that will help promote those nds of exchanges and willingness to give up talented people as ll. senator collins that was in the love and giving some points for joint service and trying to break down as and she said the stovepipes and promote a need to she culture instead of a need to know culture. >> thank you. >> senator collins, one of the other ways in which the law attempted to give the dni authority in a way that would help him or her be a better manager or leader of the intelligence community was in

the recommendation of personnel throughout the intelligence community. general hayden as the begning of a series of questions he made a think a very good point which is to the best of your knowledge, the only cia director who was actually recommended by the dni was yourself and in the other cases, i assume what you are saying is the name came from the president. while the dni may have formally put his name to the bottom of the letter recommending that is the way it happen. >> that is my understanding senator and frankly there is nothing wrong with that. but if you are going to establish that kind of relationship, if you have this ideal relationship between the dni and the dci a, starting off with one owing nothing to the other for being in the position,

it isn't a disqualifier. >> it makes it harder, you are absolutely right. none of us here think that general clapper came with -- up with the idea of general petraeus being ahead of the cia. not that he is opposed to it. i talked about and i'm sure he's happy he is happy that it. this discussion is another piece of evidence and one that we just had of the way in which the law can express an aspiration that the congress has regarding something but it all depends ultimately on w the people in the positions are implemented. go with acknowledging the piece of unaccustomed congressional humility let me go on to ask you, one other idea that has been suggested to us as we take a look back at the dni is that we ought to extend the authority of the dni to recommend, to

approve, recommend and order prove personnel throughout the intelligence community below the level of the head of the constituent agency, perhaps down to the second or third position in the agency. what you all think about that lex lets srt let's start with mr. gannon. >> e. i would think that is an idea whose time has not yet come. [laughter] >> the that didn't have any particular charm for me either senator. >> representative harman? >> i think there are higher priorities like urging the president to fully stand up to privacy and civil liberties board required under the law. i would go there before i would start an opportunity to pick new flights between the dni and other agencies. >> am i right in interpreting the reaction to consistent with what we just said about the dni relationship to the dci a, that

the head of the constituent agen ought to be able to choose his own second and there had -- just in terms of their ability to work together. let's see, let's go back to this extraordinary experience we have just been through with the intelligence leading to the take down of osama bin laden. the president designated the tour of the cia, director panetta, under title l to be in charge of this operation. even though in the end of course, and leon panetta both privately and publicly has gone out of his way to say that he then essentially delegated the final part of it to a title x force which was the special operating command under admiral

mccray then, i suppose the first question i want to ask is whether consistent with what we have been focused on today, do you think and i know this is second guessing a spectacular success but whether the president consistent with the intention of the love we were talking about should it designated the dni to be in charge of the hunt for bin laden as opposed to the dci a? jan do you want to start we will just go down the ro >> in terms i hink the answer to that is yes. i think this was a highly risky operation and there were at least plausible reasons to designate someone else. i'm just guessing that the president has worked longer with director panetta than he has with dni clapper on a personal

basis and figured he n only brought the assets to the table inerms of preparing the information on which special ops team acted but he also had a strong relationship with congress and therefore that made him probably the best guy especially in the event something went wrong. so ihink this was a call based on personal chemistry more than on an organization chart and i don't fault the president for making it and the result was spectacular. >> and it worked. >> all that is true and i agree with it but i don't think it is exclusive. i think it is structural. i don't think it is personality-based. if you do it under title l it is a covert action. executive order says the president can change this but what it says right now is the only -- is the central intelligence agency so i understand why that is gone in that direction. technically the director panetta had what is called opticon rich means he is responsible for it.

he gave admiral mccray then and his group's take on the tactical control. it makes great sense. i can't think of any other better way to do it. with regard to the dni role of this we actually have this discussion in the bush administration and congresswoman harman has talked about needing more presidential of to the job and we got a fair amount from president bush based on my recollection. we had a pretty serious debate about this role and we went to the law, and the language in the law is that the dcia reports to the dni for all the activities in the central and teijin's agency and it is not authority direction or control which are also english wor that were available but they weren't chosen. fields in a decision, and we have this discussion long before going to bbottabad, is that the dni had have total transparency. the covert actions are so

sensitive and those delicate but that president and i suspect this president wants no one between him and the individual carrying out the covert action. and so in that sense the dni is kind of here in a be aware of as the nsc role but not in that chain because we discussed this at great length. he really clearly didn't want to make this to ops rather than one. >> discussing in other words is kind of action? >> that is correct. title xv covert action. >> right and begin because the cia director is in charge of the operators. mr. gannon. >> i have no problem with the way this transpired and i don't thin really had negative impact on the dni's authorities. as a professional intelligence ofcer i regarded covert action is partially an intelligence activity. it is supported by the national

intelligence budget program so the dni should play consulted role but i think the accountability for covert action belongs acutely to the president that there should not be any players between him and the actual operations beyond the cia director. >> let me if i may go over my time, want to ask you mr. gannon a somewhat related question. i was interested in your statement and your testimony that the intelligence community has moved to what you call a more distributed model of providing intelligence support in which a large number of intelligence agencies and officers provide direct support to policymakers and also work closely with the military. in fact with troops on the ground and that there could va conflict between that model and having a strong central leadership. i just want to ask you to

develop that a little bit more. is there necessarily a conflict there or is there an argument the dni should in any case be the leader ultimately responsible for buildi the distributive network and ensuring it works properly and accountable for the performance? >> the direct answer to your question is i don't know there is necessarily a conflict of my point is i think we do need to understand the evolution of the intelligence community to a more decentralized distributed model of intelligence support. back in the '90s when i was producing intelligence, there rarely was a preference for the national customer at the cia, and i could. >> just to clarify? >> the cabinet level, washington-based, the president and the white house. >> as opposed to. >> as opposed to the warfighter, the military establishment so if

i got a request for analytic support safe from at that time -- i would say if you could wait a few days i will get a sanitized version. ice on the 97 berman change partly because of the digital revolution where we could provide it in real-time and secondly because of the demands of people like -- and he would say heck now i need it now. look at the challenge. this is the post-cold war period. i have challenges and i need to have real-time intelligence and i need to have the best tt you were giving to the president. so you started then the decentrazation. was no longer just coming out of cia. you have to find other ways to get the information out there. but i think with the balkans conflict, that began where the dema was not only to get information out there but to actually have intelligence capability in place in the field

where you could actually provide intelligence requirements and analysis directly to the mission that it was to serve. i think that is what i was talking about, the jsoc model and afghanistan. my point is that i think we can sort of lighten up about how much the dni should be controlling this. this is the network's environment that we were talking about here that mic and i both had mentioned. i think that is working very well and the dni should be nurturing that but the dni should be above it all looking for where there are gaps where you can better enable it, better resource than two growth that capability for the intelligence. i don't think there's anyway we are going to get back to the old days where you had an essentially control distribution of intelligence support. >> right and i hear you saying that we shouldn't try to get back to that. the world is gone beyond that. >> it is just the expectations

we have put on the dni. if successful authoritative dni and by the way i don't see a secretary of defense who worries about a lot of what is going on. i think this is, a lot of the success we have had in afghanistan is because we have developed a networ capability and that means you are not going to have be intrusive central authority getting in the way. >> that is great. thank you. senator collins. >> thank you mr. chairman. we talked a lot about the dni this afternoon. i want to get your assessment of the nctc, the national counterterrorism center. i remember when president rushed by executive order created what was called ptech and i can't remember what that stands for but it was the predecessor agency of nctc, and i visited i

believe that senator lieberman was with me, i vited t. tech and i remember being struck by how young the analysts were and got the distinct impression that agency sent over their least experienced analysts. by corast, when we visited nctc, the analysts seem to be far more experienced and there seemed to be competition to be assigned to the nctc, totally different, but that is my observation as a senator. i would like to hear your views of nctc. has it been effective? where does it need to go and i will start with you mr. gannon. >> i thinkctc has been fective. i think it has been grown from strength to strength and is much

better today than it was two or three years ago. i think it is doing a commendable job of integrating foreign and domestic intelligence and producing an analysis for a much broader nationally based customer base. i would say that the.which i think needs to be addressed by leadership and i think it is a leadership issue and that is the tension between nctc and the ctc and cia. i was actually around and 1986 when we created the ctc and i think the ctc, there are different missions here. i don't think it is that difficult to appreciate they are different and they should be respected for their differences. they have some need to support one another and we could address that. but i think what has happened is the ctc in the washington domain is getting less attention, less respect and i think it deserves a tremendous amount of credit

for what it has been able to do in providing analytic support to operations in the field and the reputation it has in the field if you talk to special operations people for example is very powerful. i don't think it is ever done better than it is doing now so why would we want to see that organization in any way diminish because we have created an nctc? i think you can do both of them. i think sort of the rap against ctc was that it was in support of operations and didn't support the washington community. now we have the nctc that can do that and it has the responsibility of the ctc doesn't have to do integration of foreign and domestic. i think those missions can be developed that there has to be leadership and there haso be appreciation and the white house and congress have distinct missions that both of these organizations to will the people have to be given credit for. i perception is the ctc is not getting the credit in washington

environment that i think it deserves. >> thank you, general. >> very briefly and as hn just said, i was asked this question them both the dni role, deputy and head of cia, what is the division of labor between the two? what i'm going to tell you now is not perfect. it is wary but i think as john noted that is okay. it is a bit offense and defense. u-turn to the tc first to deal with the homelanand what needs to be done about it. hence the powerful blending of foreign and domestic intelligence and law enforcement. >> ctc has its center of gravity on the offense. we are going after these people and we need to know where they are. so i think we are blessed to have both been lucky to live in a nation that has the resources that can afford what i call

redundancy, not duplication or competitive analysis. fundamentally, there are different and they're focused on different things. >> thank you. representative. >> a terrorist threat integration center, i know. i remember, was set up by president bush i think out of frustration that the intelligence function of the department of homeland security was taking so long to be tablished and i think it has now become the national counterterrorism center underwrite 2004 law has served us extremely well. i understand this point, but i think our big threat now his attacks to our homeland and a piece of this we need to nurture and in fact is doing wl is the nctc. it is very ably led by mike lighter who is a holdover from the bush administration, very good call by president obama to keep them there and get, along

with something called the -- which stands for the interagency threat assessment and coronation group, a group of police and first responders who calmed to washgton for a gear and work the nctc, is preparing good product for local law enforcement so they know what to look for and what to do. nctc plays an indispensable role in that regard. the other point i was making is that after the abdulmutallab plot was finallyfoiled, that was not a great moment for intelligce community, mike lighter set up something called pursuit teams. we discovered there was no one in the u.s. intelligence community who had sole responsibility for detecting and piecing together disparate threat information. talk about offense/defense. that is an offense we absolutely need in order to protect our

homeland in nctc provides that so i think we have room for both of these things. i think the week after in this picture is still the intelligence and analysis function at the department of homeland security. in the bush administration charlie allen had that job and he was a legendary cia director of perations who built it in my view a kind of many ciaat dhs. i'm not sure we needed it there but i surely think we need more than what we now have there. in fact it is kind of telling that rand pierce who is not the director of i am a but is an undersecretary of homeland security, has the portfolio for counterterrorism at the department of homeland security, not the director for intelligence and analysis. >> thank you. my final question for each of you is, is there any recommendation that you would like to make to us as we look to

reifies necessary to the 2004 intelligence reform act? mr. gannon? >> i would just say that i think we are in a period of transition in the leadership in the intelligence community and the should be a great time to take a step back and i think of gates is leaving. there's nobody who has more knowledge and more desire to make dings work and i think jim clapper is a guy who works very hard to work with others. i can imagine having a battered dni for the times we are in. so to bring some of the folks who are leaving to talk with them about how we could have the human dialogue about people who know and have worked like mike is an example, bring them together to ask let's commit ourselves toaking this work. let's admit we have a need to do it, and let's concede we have a terrific guy and jim clapper and a capable set of leaders across the intelligence community and get their ideas about, and their

commitment, with newleaders to move forward. >> thank you. general? >> i would be receptive to whatever the dni when he needs changes on lott to go where he has to go. i don't think there'll be numerous but when they come i think you can bet he needs th to get from here to there but to echo what has been set at the table before, a lot more is depending on the individuals and taking full advantage of the law and those informal structures that get so much done in such a complex kind of organization, so i would keep a close watch on that. if you do end up with for lack of a better word pathologies in terms of poor process and personalities, then there isn't enough history and there isn't enough structure to overcome that. and therefore, that is a danger sign. you need to be aware of. >> thank you. >> i think the law is a good law and it is working and the people

in the top positions are excellent, and we had an enormous success last weekend we have had other substantial successes over the last several years. we are getting better and better at this, building on the record of three administrations in pursuit of osama bin laden starting under bill clinton when he was indicted and again at the cia was set up to pursue him. we didn't get ari far with that. the then national security pfizer's hair was on fire but alas, we didn't get the job done and through the bush administration and now the obama administration, with successive congresses we are doing better so i would kind ofay that is in good shape. a piece of the law that has never really been implemented is the formation of a robust privacy and civil liberties ard. i know both of you have written letters in my last job i wrote

leers. to people of the top of now been designated by this administration but i don't think the board -- and why does this matter? it is not just to check a box of the civil liberties community which is a robust community and should be as happy. is to make certain there is full vetting of policies that affect our u. constitution and the implementation of the fisa limits we all work so hard on and the implementation of the patriot act and perhaps new policies to deal with something i know you are both worried about which is our vulnerability to cyberattacks. we want a group of knowledgeable people tscreen these things and then o persuade an anxious public that the policies are a good idea. i was told today that the patriot act extension may be in trouble on the hill in both

parties because people don't understand why we need it. and, i think they would understand that that or if there were a bipartisan privacy and civil liberties board to explain this. the final point is that our vulnerability in the near-term future is to our homeland and thatis why the nctc matters and that is why vertical information sharing matters. we have to think very carefully about the domestic intelligence space and how we are going to move forward and make sure that we don't trade off liberties for security. i don't think that is a zero-sum game. i think we will either have oath or we will have neither. getting from here to there will depend on the watchdog that the three of us plus pete hoekstra insisted be in the 2004 law that s not yet been fully operational. >> thank you. thank you all. thank you mr. chairman.

>> thank senator collins. one more item that i want to take up with you while we have you here. my impression from the testimony at least a representative harman and mr. gannon is that using the term general that yu used, kennedy of effort, is that we don't have the unity of effort regarding domestic intelligence that we have regarding foreign intelligence. and i know represented harman you have been critical at the department of homeland security is not where it should be. i agree. i think secretary napolitano is working on that and we are getting better but i wanted to invite any of you and we wil start with mr. gannon because you made this point, what is the oblem in terms of unity of effort? i note you weren't criticizing the of theeye. you were admiring their

improvements they have made in counterterrorism but what do we need to do and does the dni needed additional authority or is this one of those areas as you said before that the dni, looking across the community, maybe this is an area that the dni authority has now focused in on? >> i would like to make several points here. i think you are dealing with frankly new agencies like the department of homeland secity. compared to the department of defense or the cia, they have years of doing foreign, working on the foreign intelligence side and developing cup at -- capabilities that are extort me. we don't have these capabilities. the fbi, and by the way would have reduces racism for the fbi today but i would also say that i think we underestimate the difficulty of transforming a law-enforcement agency into an intelligence agency and if i had been a cia man transferred to a

law-enforcement agency i would have been horrified. so i think we had to expect was going to ke some time and then some of the constitut agencies are doing their own thing and dealing with new missions. there is a lot of overlap, but i would also have to say that you also have fragmented congressional jurisdiction that i think it's been a real problem. there is no but would call adult supervision, giving all these agencies and ability to deal with the strategy and then to measure progress against that strategy. >> adult supervision from congress. >> yes. i wasn't talking about you. >> i know, i know. this is the most significant failure we had been working to adopt the recommendationof the 9/11 commission and we were really pretty good at reforming

the executive branch but when it came to reforming congress, it just didn't work. >> fud again on the national side you have got the cia with years of practice and they have jsoc now which really has become a center, the gravitational pull on the agencies to work collaboratively. >> and as you said. >> don't have any counterpart on the domestic side and a lot of what is being done including with the fbi while the structure is being put in place the output i think is -- but i have actually attended some of what i can find of who actually has jurisdiction in a particular hearing, i don't find it an aggressive approach on part the part of congress to really put quality measurement on what is going on. >> so what should be done about this? general hayden? >> first of all let me just say

i agree totally with everything that john is just dcribed. not bad people or lack of effort. it is very hard for us to d because we haven't done it historically. recall your legislation sets up the fbi to be a domestic intelligence service and everyone said that it was great in 2004 and late 2008 attorney general mukasey finally did issue fbi guidelines with regard to working the spaces between cases as a domestic intelligence services. you saw how will well that it in the popular political culture. it unleashed a firestorof criticism so this is hard because we have not done it before and our political culture is a bit of a rejection for it. it brings the point to call someone harman brought up, you make people feel better if you have got those mechanisms in place and working to give a comfort level that this is being overseen as well. i guess to reinforce it, this is a very important if not the most important area of focus, the new

flavor of threat homegrown, low threshold, self-radicalized, individual which puts a lot or wait on domestic as opposed to foreign, lot or wait on law enforcemen as opposed to intelligence derived and if we don't begin to perfect our processes and organizations there are, something bad will happen and we will overreact and perhaps make it even worse. >> well said. go ahead representative harman. i was going to ask you if you agree whether this is a matter of trying to give new authority against the dni or just searching the dni to focus in on domestic intelligence as one of the weaker links in our chain? >> i think the dni has adequate authority. i think we need to have, and this is something you can do, a

public debate about how to do this. not whether to do this. i think most people get it, that the riskf megrown terrorists great and maybe the harm from homegrown terror won't be as great as two towers in new york falling down and killing 3000 people but it is certainly possible, we all know this, that nuclear or radiological materials not only can be funneled into this country but certainly they radiological materials are hearing can be assembled into a dirty bomb or several and harm a lot of folks. but my point is we need public by an. and. it isn't just making people feel better. at least that is my view. is making them agree that our constitution will be respected and it must be. otherwise the underpinnings of our country are done and we turn into something else, which i surely don't want us to do. we have not yet had a robust

public debate about a comprehensive framework through security framework and a post-9/11 world. we have done that the psychically. we did the patriot act, which i supported. we amended the patriotic -- patriot act which i suported. we did fisa amendments. we did intelligence reform, ut we haven't thought through how all the pieces fit together and i don't know we would agree and i don't know hat this is the best time for congress to do this since there is an excess amount of partisanship in congress at the moment that if ever there was a time to give this committee adequate jurisdiction to hold that debate and do broader legislation, not just moving boxes around for the dni, but really thinking about in a new world with 21st century threats, how should americans deal with the tension, interrogation, investigation of

americans on american sl, racial profiling or other activities that are -- how should we do this comprehensive way? i think this is the time and this is a huge service you could perform. i think the hearings you were holding right now are very helpful, and i'm very happy to participate in one, but i would urge the congress to play its role as a co-equal branch of government to thoroughly assess what is the right way of the buy-in to fill this domestic intelligence space. >> thank you. this is an interesting place for us to come but it does point to what needs to be done next and it does relate as you all said, to the unique threat which is to say we didn't have homegrown

domestic terrorism in our minds when we adopted the 2004 acts. it now becomes a very significant part of the threat that we face and we are trying too this in ways that are different, as he wills that. for instance the dhs is trying to interact with state and local law enforcement, literally hundreds of thousands of people. they're obviously interacting with the leadership, but potentially a mighty force of gatherers of intelligence, if you can do this well and we are still feeling our way. i don't have anymore questions. i want to thank the three of you. has been a very valuable session for us. it really brought to bear the quite remarkable and long experience you have all had. you know, we are going to

continue these hearings and stepped-up and decide wheher we think there is any legislation proposed in a session of congress to better achieve the purposes for which the original legislation was adopted or whether this is a matter where we ought to just agree on a report or even, in part public and impart maybe just to meet with some of the key players and say hey we have taken a look at this, and here is what we really think based ona what we agree you ought to be focused on now. doesn't require a new law but it es require attention and coordination. with that i thank you. the record of the hearing will stay open for 15 days for any additional questions and statements. the hearing is adjourned.

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