secret service, nypd and f.b.i. the secret service is investigating that incident. scary for anyone. >> sandra: absolutely. >> bill: a family connected to the white house. we remember the anthrax scare. >> sandra: she went to the hospital as a precaution. they didn't know what the substance was. glad everybody is okay. building a big, beautiful wall is one of trump's promises. companies are submitting bids to build a portion of that border wall in texas. how does the bidding for this work? >> sandra, as you know the process has been playing out in other places like in california. but now the wheels are officially turning here in the lone star state. the bids are coming in. contracts set to be awarded in may. we shot this drone video of the general site where the three-mile portion of the wall would go that is in rio grande valley of south texas, it's dense in places and the river is the international border. also it is home to some 2,000 acre santa ana wildlife refuge. part of the wall will cut through it and environmental groups say it will devastate the ecosystem why the federal government designated it as a national park in the first place. >> it is basically sort of renegeing on a promise that congress and the government made in 1943 that this was so valuable it needed to be protected and that they would now turn around and do something that would do such damage to it is beyond irony. >> the total price tag for this particular contract $25 to $100 million. >> sandra: casey, the government maintains this wall is necessary? >> that's right. u.s. customs and border protection tells us this area we're talking about is one of the busiest trafficking routes in the whole sector. we experienced it ourselves down there doing live shots on the border a couple of weeks ago when we saw border agents race up and pull several people right from our camera position. the brush, illegal immigrants who had just crossed into the u.s. in a statement to fox news i'm quoting here, the federal government says cbb works diligently to integrate responsible environmental practices including incorporating sustainable practices into our decision making and operations. so moving forward for now here is the plan, sandra. >> sandra: casey stiegel. thank you. >> bill: 9:27. washington, d.c. we are moments away from the start of that senate intel hearing committee on national security. we're hearing it will be dominated by questions on the russia matter. the british spy behind that unverified trump dossier and a lot more. we'll take you there as soon as it begins on tapp -- capitol hill. >> sandra: a pair of republican senators demand answers about unusual activity by former national security advisor susan rice during her last day on the job. >> things start to unravel and one thing pulls another thing and then one morning you are in a space you never dreamed on because they keep unraveling. one more example of this thing unraveling. ♪ >> sandra: the markets opening a short time ago. stocks taking a little bit of a braoergt as you notice this morning after the dow surged more than 400 points to close the session yesterday. a volatile couple days and a volatile couple weeks for the stock market. investors are on edge over the potential for rising interest rates. a lot of folks watching the bond market dropping yields there. some investors running for cover. it is amazing when you still look at this volatility and the dow still at 25,000. >> bill: the volatility went like this for about a year. now it's all over the joint. i guess it will stay, right? >> sandra: we'll watch it. >> bill: 9:32 now from new york to washington, d.c. check this out. top intel officials about to testify before a senate hearing on the top threats to american security. it starts in a moment. said to be one of the more critical security hearings all year. we understand the russia matter, as well as the unverified anti-trump dossier could dominate questions today. we also hear about those dueling fisa memos. a lot of topics now. the f.b.i. director christopher wray is there. mike pompeo, dan coates and all will take questions in a moment. we'll take you to that hearing as soon as it gets underway. we have a period of opening statements and we'll get into the meat of it. the question and answer usually is where we can find most of our story lines. stay tuned and we'll watch it live from the hill coming up. >> sandra: a fox news alert. a pair of top republican senators wanting to question former national security advisor susan rice about an email she sent to herself on the day of president trump's inauguration. the partially declassified email details a white house meeting involving president obama on how to proceed with the russia investigation. senators chuck grassley and lindsey graham sending rice a letter asking her to explain her quote unusual activities from her final moments as national security advisor. here is senator graham last night on the story. >> she is sending herself an email talking about her conversation on january 5th with the president reassuring herself and i guess the president that this would be done by the book. i think that's odd and disturbing because we know that the investigation regarding the trump campaign was anything but by the book. >> sandra: joining me now are josh holmes former chief of staff to mitch mcconnell and marie harf, former state department spokeswoman. as we go to our panel the witnesses are walking into the room of that senate hearing that is about to get underway. we'll continue watching this four and any developments there. meanwhile i want to bring you in first, josh, on this email that has been discovered, written by susan rice on the president's inauguration day. what stands out here to you? >> i think if we knew nothing about susan rice the email in and of itself wouldn't that be concerning. the incoming national security advisor michael flynn they knew he had been in contact with the russians during the transition period and deceived his own administration about those contacts. not surprising they would be concerned. the problem here is that susan rice has had a long and troubled history and relationship with the truth. and particularly with regards to anything that could be remotely considered by the book. and so when she says that she is doing something that is quote, unquote, by the book and makes a notation for it that quite literally is there to cover her and the president in the event this becomes a larger investigation, it certainly is worth looking at. >> sandra: marie, before i go to you i want to highlight what you are watching on the left-hand side of the screen, the senate intelligence committee holding a senate hearing on worldwide threats. as you can see the witnesses have now taken their seats there. present is director dan coats. the cia director and f.b.i. director. we'll be listening to this and bringing you questions when they begin. meanwhile, marie, i want to bring you back in here. this email that was written by susan rice on inauguration day, what does it tell you? >> it doesn't tell me all that much that we wouldn't have assumed was happening. it is not unusual at all, i assure, for officials the make memos for the file and record. it was the last day and she was making sure that everything was cataloged, everything was in order. she was probably cleaning out her office i'm assuming. so actually josh hit something pretty right in what he said. a lot of how you read this email i think is being determined by what people already think of susan rice. for those of us who worked with her and trust her who know her, this email looks totally normal like something any administration officer would do. >> sandra: let's look at parts of her and she reinforces things were done by the book. that's really what stands out to a lot of people and to you too, josh. she writes president obama stressed his continuing commitment that every aspect of this issue is handled by the book. the president stressed that he is not asking about initiating or instructing anything from the law enforcement perspective and reiterated our law enforcement team needs to proceed as it normally would by the book. says it twice, josh. >> there is no book for what they were talking about. what is concerning to me about it and the reason that the senators are asking more questions is because we've been dealing with susan rice, a moving target of misinformation going back to, you know, what the sources and methods were for finding warrants on carter page, for all the way back to benghazi for crying out loud. if she was somebody that republicans thought honest and trustworthy that would be in a different category. but given her history here it is worth looking at. >> sandra: it certainly if one were to give her the benefit of the doubt as newt gingrich did as well while he says it raises serious questions. some people write notes to themselves to remember later on. the white house responded earlier to this. raj shah was on and for them this does raise serious questions. listen. >> that email raises a lot of questions. i can assure you that five minutes before you walk out the door of the white house on january 20th of 2017 you write an email about doing something by the book it is pretty clear you didn't operate by the book. >> sandra: marie? >> there have been a lot of accusations, inappropriate and unfounded. raj shah would say that. there are partisan politics at play here. that happens in washington look, susan rice was saying this was being done by the book. what else would we want our officials to do except for do things by the book? so we can't assume because some people don't like susan or don't like things she did or said in the past that this is any indication of any wrongdoing. >> sandra: isn't it fair they want answers? the two senators are saying it strikes us odd among your activities in the final moments and final day of the obama administration you would send yourself such an unusual email documenting a conversation involving president obama and other high-ranking officials. clarify what it is about. >> it's not unusual, josh. >> susan rice is a smart lady. sophisticated. she knows that everything she is dealing with here can be thought of as not by the book. when she gets an email to herself first of all. people do that. we saw jim comey do it. that's been part of the public record, too. when you do that you are trying to communicate something to somebody who would find something like that for public investigation. when you are explicitly saying by the book, it should go unsaid that our government officials are doing things by the book. >> sandra: a lot of people including those two senators and white house want answers. what does all this mean? we'll see where it goes. josh and marie, thank you. >> bill: the hearing is underway as we await the question portion. the republican immigration proposal on the hill today that the gop says is the only plan that can pass senate and be signed by the president. >> i think if this bill as written passes through the senate we can be confident and it can pass the house and get the president's signature. >> bill: republicans call it the final offer on the table. first and final offer. will it be a path to citizenship? will democrats play ball? senator john thune here to answer a lot of questions on that coming up next. >> sandra: the attorney general slamming ms-13 in a speech to america's sheriffs. what he is calling for in the battle against the notorious gang. >> they are by far the most violent gang. let's crush this bunch. let's show them they can't take over our streets. 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british spy christopher steele. moscow's ongoing attempts on the mid-term elections. we'll go to the questions when they begin. >> president trump: i did not want daca in the budget. i wanted daca separate so we could talk about it and make a deal. and i hope to be able to make a deal. i hope the democrats are not going to use it just as a campaign. they've been talking about daca for many years and they haven't produced. >> bill: president trump laying out his plan for daca saying once that is separate from the budget. pathway to citizenship for 1.8 million daca-eligible immigrants. $25 billion going to a border security fund. limiting chain migration. reallocating the visa lottery. mitch mcconnell says it has the best chance of passing in the senate. the chairman of the senate republican conference senator john thune is with me now. you need 60 votes. tell me why a moderate democrat up for reelection in november, perhaps in a state where this is not so popular, why would they vote for it? >> well, there are a lot of reasons, i think, bill. first off, if you are a moderate democrat or anybody you want to solve the problem. i think the president has put a good faith effort out there and obviously it addresses the issue of providing legalization for all the daca young people. at the same time strengthens border security and tries to prevent this problem from occurring in the future and looking at issues like chain migration and visa lottery. those are all things i think that if we'll solve this problem in the long term have to be on the table. whether or not there are the 60 votes necessary in the senate to get that done remain to be seen. i do think the president has led on this and has given the senate a lot to chew on this week. we'll see where the amendment process takes us. >> bill: i'm curious, what of substance -- what of significant legislation can pass in this senate with 60 votes? >> well, i think that's really a good question. the other issue the president advanced yesterday was infrastructure. that will take democrat votes. we have to get 60 for that. it will have to be paid for as well. so trying to figure out the sweet spot how do you attract the correct number of democrats will be challenging. on immigration if people are interested in finding a long-term solution to the problem, then there ought to be a coming together between republicans and democrats. when we're done debating this we'll see what's left standing and whether or not there is a chance we could send something to the house. but you also have to get past the house and it has to be something the president eventually will sign into law. those are all considerations we have to look at as we start the debate here today. >> bill: your colleague from arkansas said this is it. this is the first and final offer. is it? >> i think -- i don't know about that. i think there will be probably several versions of immigration legislation that will be voted on this week. but if you want to do something that is very forward-looking, that does take this issue and put it behind us for the foreseeable future, what the president has put forward is that kind of solution. with the cotton/purdue, cornyn legislation mirrors the president's proposal. that will be interesting to see how the vote on that goes. i think there will be other proposals that will be considered as well. >> bill: the deadline three weeks from yesterday. i'm sure you're well aware of the calendar. on infrastructure you like the whole idea to take public money, private money and rebuild america. how is that going to happen >> i think what the president put forward cutting red tape, reducing the project time down to two years is really important. these projects drag on forever. it is impossible to get anything done in this country and it is enormously expensive. it would be a huge reform. if you can look at broadband and he has a big priority on rural areas that i'm very much in favor of. i have 54,000 deficient bridges in this country. people spend 7 billion man-hours in traffic. infrastructure needs in the country. it gives us the opportunity to build upon the economic number with reg tore and tax reform getting the economy moving back in a more positive direction. one of the things that will be important is that whatever gets done reduces red tape and makes these projects less bureaucratic and figure it out how to pay for it. we have to answer that in the weeks ahead. >> bill: we're waiting for this hearing. taking our viewers there probably 15 minutes or so when the questions get underway. what is the russia, russia, russia matter doing to the work you're trying to get done in the senate? is it having an effect or not? >> it is really important that we be able to work on more than one thing at one time. and obviously we're multi-tasking here. the russia issue needs to be concluded. there is a certain point we've exhausted all the questions. everybody has testified and you have the record built and let's release the conclusions and let the american people decide. but let's bring this to a close. i think at some point it has to end. >> bill: senator, thank you for your time. come on back. >> sandra: we're monitoring that major senate panel hearing underway right now. top intelligence officials will be testifying next. vice chairman mark warner was discussing the threat of russia meddling in our mid-term races and saying we have no plan to deter future attacks. >> bill: also talking to defense officials warning that isis is still a serious and significant threat. where is the battle next? that's coming up. >> tech: at safelite autoglass we know that when you're spending time with the grandkids every minute counts. and you don't have time for a cracked windshield. that's why we show you exactly when we'll be there. saving you time, so you can keep saving the world. >> kids: ♪ safelite repair, safelite replace ♪ >> sandra: a live look intelligence officials now testifying at a senate panel hearing on worldwide threats as defense secretary jim mattis is warning coalition partners the battle against isis is entering a new phase. david lee miller is live in our mideast newsroom. >> sandra, at this hour the defense secretary is in rome. it is part of a six-day trip overseas on the agenda plotting the further destruction of isis. he is meeting today with his italian counterpart. he says isis has been forced out of iraq but that it is still operating in parts of syria. speaking to reporters yesterday en route to europe he has much has been accomplished but the fight is not over. >> first mission finish off isis physical caliphate. that is still underway. those of you who have been on the plane remember me saying the fight is not over against isis. it is not over. it goes on. >> u.s. secretary of state rex tillerson delivered a similar message. he spoke at a meeting in kuwait of the global coalition against isis. the u.s. is going to provide an additional $200 million to stabilize portions of syria that had been under the control of the islamic state. he said major combat operations against isis have ended it hasn't been defeated. he said the coalition remains committed to destroying what is left of the group. >> these principles affirm our common determination to continue our cooperative efforts using all available means until we have achieved the full and enduring defeat of isis. the enduring defeat of isis in iraq and syria means all members of the coalition must support and sustain the post-isis stabilization efforts. >> he went on to say although isis has lost control of much of the territory it once had, the group is still a threat. he said that it is morphing into an insurgency in countries like afghanistan and said that combating isis involves not only air strikes but cutting off funding and stopping the flow of foreign fighters. >> sandra: thank you. >> bill: so our viewers in case you are just joining us, these are the intelligence heads from all over washington the head of the f.b.i., the head of the c.i.a., that's christopher wray and mike pompeo and you know they will be in the cross hairs for questions about the russia matter and the dossier and on and on. catherine herridge tells us christopher steele is expected to be mentioned today. mid-term elections coming up in november nine months away. mark warner is the ranking democrat on the committee. in his opening statement he was all about well, pretty much all about russia. he mentioned it time and again about the coordinated attack during the election of 2016 and was asking the question repeatedly what do we do about russian trolls and bots here and in europe. expect that to be a lot of the news today, sandra, from the hearing today. >> sandra: to mark warner's opening statement he talked about a continuous assault by russia saying the president does not implement sanctions when he can. this is already shaping up to be a pretty fiery hearing taking place on capitol hill with the highest-ranking intel officials we have. so we're certainly going to be listening to this. we got a heads-up this is going to include a wide range of topics. the russia probe, the dossier, christopher steele, the british spy, moscow's efforts to target the mid-term elections on tap for this hearing. >> bill: this is the type of hearing we would hear about all the national security threats be it isis, russia, china, or north korea, or al qaeda, but it has taken on a different frame ever since the election and what we've followed over the past year. here is dan coats. you will also here from the nsa directors mike rogers and f.b.i. and c.i.a. director. here we go. >> it is all but thwarted. however, isis remains a threat and will likely focus on regrouping in iraq and syria, particularly in ungoverned portions of those countries, enhancing its global presence, championing its cause, encouraging members and sympathizers to attack their home countries. meanwhile, al qaeda almost certainly will remain a major actor in global terrorism as it continues to prioritize a long-term approach and the organization remains intent on attacking the united states and u.s. interests abroad. now, moving on as if we don't have enough threats here on earth, we need to look to the heavens. threats in space. the global expansion of the space industry will extend space-enabled capabilities and situational awareness to nation, state and commercial state actors in the coming years. russia and china will continue to expand their space-based reconnaissance and navigation systems in terms of numbers of satellites, breadth of capability and both russia and chinese counter space weapons will at maour over the next few years as each country pursues anti-satellite weapons as a means to reduce u.s. and allied military effectiveness and perceptions of u.s. military advantage in space. in the final functional topic is organized crime that is a growing threat to u.s. and allied interests. these criminal groups will supply the dominant share of illicit drugs, fueling record mortality rates among our population. they will continue to traffic in human life. they will deplete national resources and siphon money from governments and the global economy. i would like to briefly go around the world on regional topics starting with east asia. if you went out and hired a private plane and launched from los angeles and went around the world and stopped at every hot spot in this world you would make multiple dozens of stops. that's the kind of threat that we face but let me start with east asia. north korea continues to pose an ever-more increasing threat to the united states and its interests. they have repeatedly stated it does not intend to negotiate its nuclear weapons and missiles away. because the regime views nuclear weapons will critical to its security and leverage to achieve his long-term ambition to end seoul's alliance with washington and to eventually dominate the peninsula. in the wake of its icbm tests last year we expect to see north korea press ahead with additional missile tests this year and its foreign minister has threatened a nuclear test over the pacific. they're committed to fielding a nuclear armed missile capable of posing a direct threat to the united states. and modest improvements in their conventional capabilities will continue to pose an ever-greater threat to south korea, japan, as well as u.s. targets in those countries. china will increasingly seek to expand its regional influence and shape events and outcomes globally. it will take a firm stance on its claims to the east china sea and south china sea. its relations with taiwan and its regional economic engagement. china also intends to use its one belt, one road initiative to increase its reach to geo strategic locations across eurasia, africa and the pacific. from east asia we head to south asia. in afghanistan, kabul continues to bear the brunt of the taliban-led insurgency as demonstrated by recent attacks in the city. afghan national security forces face unsteady performance but with coalition support probably will maintain control of most major population centers. complicating the afghanistan situation, however, is our assessment that pakistan-based militant groups continue to take advantage of their safe haven to conduct attacks in india, in afghanistan, including u.s. interests there. pakistani military leaders continue to walk a delicate line ongoing pakistani military operations against the taliban and associated groups probably reflect the desire to appear more proactive and responsive to our requests for more actions against these groups. however, the actions taken thus far do not reflect a significant escalation of pressure against these groups and are unlikely to have a lasting effect. in the last month the administration has designed -- designated eight militants affiliated with the taliban and other pakistani militant groups and we assess that pakistan will maintain ties to these militants while restricting counter terrorism cooperation with the united states. next is russia where president putin will continue to rely on assertive foreign policies to shape outcomes beyond russia's borders. putin will resort to more authoritarian tack tickets to get control to challenges to his rule. with respect to russian influence efforts let me be clear. the russians utilize this tool because it's relatively cheap, it's low risk, it offers what they perceive a plausible denyability and proven to be effective as sewing division. we expect russia to continue using propaganda, social media to build on its wide range of operations and -- there should be no doubt that russia perceived that its past efforts has successful and views the 2018 u.s. mid-term elections as a potential target for russian influence operations. from russia i'll turn to the middle east and north africa. this region will be characterized by political turmoil, economic fragility and civil and proxy wars in the coming year. iran will remain the most prominent state sponsor of terrorism and an adversary in the middle east especially in iraq, syria and yemen. they will seek to expand the regional influence and exploit the fight against isis to solidify partnerships and translate battlefield gains into political, security and economic agreements. we also assess that iran will continue to develop military capabilities that threaten u.s. forces and u.s. allies in the region. for example, iran has the largest ballistic missile force in the middle east. the islamic revolutionary guard corp navy and unsafe and unprofessional interactions pose a risk to u.s. naval and allied naval operations in the persian gulf and hezbollah provides direction to other militant and terrorist groups all formeanting regional instability. iran's provocative and assertive behavior as we saw most recently this past weekend in northern israel increases the potential for escalation. turkey will seek to thwart kurdish ambitions in the middle east and the ongoing turkish encourage into northern syria is complicating ongoing counter isis activities in the region and increases the risk to u.s. forces locateed in the area. syria will face unrest as damascus recaptures urban area and violence decreases in some areas. iraq is likely to face a lengthy period of political turmoil and conflict. the social and political challenges that gave rise to isis remain and iran has exploited those challenges to deepen its influence in iraq's military and security elements and diplomatic and political arms. the war in yemen between -- is likely to continue and worsen the already tragic humanitarian crisis for 70% of the population of 20 million people in need of assistance. the situation in yemen is emblematic of a far larger problem. the number of people displaced by conflict around the world is the highest that it's been since the end of world war ii. turning to europe where i want to draw your attention to two significant developments that are likely to continue to impact european politics and foreign policy in the coming year. let me state first the continent center of gravity appears to be shifting to france where president macron has taken a more assertive role in addressing european and global challenges. results of the recent german election, i think, enforce that assessment. second, recent efforts by some governments in central and eastern europe to undermine judicial independence and parliamentary oversight and increased government control over public media are weakening the rules of law. these steps could see further democratic decline. many more topics i could discuss. i haven't even gotten to the western hemisphere or africa but i would like to close with discussion of one additional threat. this one internal and somewhat personal. i'm concerned that our increasing political process particularly with respect to federal spending is threatening our ability to properly defend our nation both in the short term and especially in the long term. the failure to address our long-term fiscal situation has increased the national debt to over $20 trillion and growing. this situation is unsustainable, as i think we all know, and represents a dire threat to our economic and national security. former chairman of the joint chiefs of staff first identified the national debt as the greatest threat and joined by national security leaders of both parties including former secretaries of state madeline albright and henry consist ingears and our current defense secretary jim mattis agrees with this assessment. many of you know i have spent a lot of time in my last term in the senate working on this issue and unfortunately the problem continues to grow. so i would urge all of us to recognize the need to address this challenge and to take action as soon as possible before a fiscal crisis occurs that truly undermines our ability to ensure our national security. with that i and the rest of the panel are happy to take your questions. we appreciate the opportunity to be with you today. thank you, mr. chairman. >> thank you very much for that very thorough overview of the world and what's in play. i will recognize members based upon seniority for up to five minutes. admiral rogers according to the statement the intelligence community says the most detected cyber operations about the united states private industries are focused on clear contractors whose products and services support government and private sector networks nationwide. rate the intelligence community's performance when it comes to notifying clear defense contractors and other sensitive private sector actors about malicious cyber activities on their networks. >> so first i don't have day-to-day execution. it is not informed by day-to-day experience. this is an issue both as nsa and cyber command i try to work aggressively. this is of tremendous concern for us as a department. clearly i think we are not where we need to be. the challenge i think is we've got multiple areas of knowledge and insight across the federal government within the private sector and how do we bring it together and integrate a team with some realtime flow back and forth. that is not where we are today but where we have to get to. >> in your estimation are we doing enough to warn the private sector of the threat that's out there? >> i think we are informing them as we become aware of it. we'll only see one slice of this picture. i'm also interested from the private sector's perspective. tell us what you're seeing and if we can bring these two together we'll have such a broader perspective and more in depth knowledge of what is happening. i think that's part of this. it is not just one side needs to do a better job. i think it's our ability to bring this together as a team. >> given that you've seen the difficulty especially this committee and the intelligence community has had communicating with tech companies about a way forward that is in commonality, are you concerned at how this is going to become an increasingly challenging landscape for both congress and for the intelligence community working as we see new tech firms emerge every day? >> yes, i am. i wonder how bad does it have to get before we realize we have to do some things fundamentally differently. i would argue if you look at the internet of things and security levels within those components, folks, this is going to orders of magnitude. if we think the problem is a challenge now, just wait. it will get much, much worse. exponentially from a security perspective. >> director pompeo north korea is likely to press ahead with more missiles tests. the foreign minister talked about a nuclear test under the pacific may be under consideration, what do you assess the raoej anal reaction to this kind of test? >> if i may just take one minute to say i've been doing the figuring out and express my appreciation to this committee for helping to c.i.a. do the things that need to do to providing us the resources and authorities we need. we've put a lot of effort against this very problem. you've all been very supportive of that. so my team thanks you for that. we think a test like that would certainly further unite the region. having said that our sense is that we have built a global coalition pushing back against kim jong-un and his terror regime. with respect to what each particular country might do i would prefer to keep that conversation to closed session this afternoon. >> okay. what's the i.c.'s assessment of north korea's willingness to employ its military capabilities? >> one of the things that director coats referred to in his opening remarks is that kim jong-un remains not only intent on staying in power. that the thing all dictators prefer to do, right? die in their sleep at the peak of their power. but he has this mission that is a longstanding north korean idea of reunification and their capacity to use a nuclear umbrella combined with their conventional forces to exert coercive behavior inside their country, certainly against south korea but more broadly is something our analysts are continuing to look at. we can see as they ratchet up their nuclear capability making a response more difficult their capacity to do harm in the region as a result of their incredible conventional capabilities alone increases. >> probably for general ashley and admiral rogers, according to statements for the record, the widespread proliferation of artificial intelligence will prompt new national security concerns. how is the i.c. accounting for the possibility these new national -- of these new national security concerns? are we seeing indications now that our adversaries are working to harness emerging technologies like artificial technologies and are we looking to do that in our own processes and analysis of data and intelligence? >> if i could take that first shot at that one. if you look at d.i.a. thanks for all the support the committee provides to the defense intelligence agentz. you look at our coordination and foreign militaries and operational environment central to looking at doctrine and what they are developing. when you think about artificial intelligence our near peer competitors are pursuing this. commercial technology that is available. when you look at the volume and big data and what is available, the ability to digest and pull all that information in, artificial intelligence will be integral to that. an example of one of the projects we're working on at the open source level project maven. full motion video. social media, full motion video you never will be able to afford the workforce to go through all the material, whether it's video, whether it's what admiral rogers works in the way of intelligence or what's available in social media. artificial intelligence and machine learning. it is more machine learning than artificial intelligence we're seeing all of our near peer competitors invest in these kind of technologies. it will get them to decision cycles faster, allow them to digest information in greater volumes and have a better understanding of what is happening in the battle space and strategic environment. >> i would agree with general ashley and highlight every organization on this table is faced with the challenge of victims of our own success in some ways. the ability to access data brings its own set of challenges. we're collectively attempting to deal with this. when i look at potential adversaries i see them going through the same set of challenges. there is a national strategy designed to harness the power of artificial intelligence to generate strategic outcomes along the lines to general ashley highlighted. if you look at their research, you look at how it is affecting the amount of data they are going after. i can remember 5 or 10 years ago looking at some data concentrations and thinking to myself this is so large and such a large amount of information in it, it would be difficult for an opponent to generate insider knowledge from it. i don't have that kinds of conversations anymore. the power of machine learning, artificial intelligence and big data analytics data concentrations increasingly are targets of attraction to a whole host of actors. you have watched the prc and others designed to access these massive data concentrations. >> if i could follow up on that. this is one of those areas that's available in the commercial industry. you see a lot of investment that are pursuing this. a key piece of this i think it's worth addressing as well. how do you operationalize it? you go back and if i could just use a world war ii example. the fact that there were planes, radios and tanks was not unique to the germans in world war ii. they came up with an operational concept that allowed them to leverage that. peter singer, if anyone has read ghost fleet is a futurist. we sat on a panel with him. it was interesting when i asked him as you look at the things the tech nology and things that are coming up. what is break through to give somebody as a marked advantage. his comments was who is able to harness it and who is able to operationalize it and put it to effect. the lot of the technology will be available globally. >> thank you. if i could just ask your permission here. nga has probably taken very significant lead on this given the enormous volume of collection they take and the inability to process that through humans. i asked robert to answer that question for you. they are taking leading efforts that might be helpful. >> i think it's important to note at the front what hasn't changed quite frankly. the mission, the responsibility, this whole table has is to provide you with decision advantage. what's changed is the world around us and now within us. so what we used to hold exclusively because we had capabilities that others didn't is now more shared and so as admiral rogers said this is something we all lock arms on because it isn't the access that is exclusive anymore. it's the use. it's the concept of operations as general ashley said. i have the same concerns you do about getting the cooperation we need from these companies. i'm rather optimistic about it. i think at the end of the day we can advance the american economy, we can advance american entrepreneurship and we can advance our understanding of the world in a way that gets back to that first step, which is decision advantage. >> rest assured processing of data will come up in our closed session with you. i have you targeted. >> thank you, mr. chairman. i think i take with some note the fact that the odni directed starts his discussion with cyber. it is very telling in terms of how we view worldwide threats. one question on the record. we all know it's been over a year since the russian intervention in our 2016 elections. we've also seen russia intervene in a number of other western democracies. i would like each of you to briefly reconfirm to the american public that our intelligence community understands this threat. last year those of you who were on the panel each expressed confidence in the january 2017ic assessment that russia interfered in the 2016 elections. i would like each of you today to reaffirm that and also with a simple yes or no do you agree with director pompeo that we haven't seen a significant decrease in the russian activity and we have every expectation that they will try to continue to intervene in our elections in 2018 and 2020. start with you, a simple yes or no will do. >> no change in my view of the 2017 assessment and i support that and i agree with director pompeo's assessment about the likelihood of the 2018 occurrence as well. >> i stood by the 2017 work and i agree with director pompeo. it won't change or stop. >> ye, it is not going to change nor is it going to stop. >> throughout the entire community we have not seen any evidence of any significant change from last year. >> i agree with director pompeo. >> you've been waiting for that answer. >> i've had that one in my pocket for a while. yes, sir. >> as do i. one area that i think we were a little all caught off guard on and agree understandably is how the russians used social media and i realize this is a new area for all of us and there are legitimate issues around american civil rights that have to be balanced. the fact is, i think we have to have an organized plan going forward. this question will be directed at dni coats and director wray. if others want to weigh in. because of the notion that these companies, while maybe located here, operate in cyberspace and when we've got somebody masquerading as mike pompeo but is boris in st. petersburg it doesn't fit neatly into a particular flow chart. director coats and director wray, who is in charge of addressing the threat posed by foreign national and foreign nations in terms of their use and misuse of social media? >> no single agency, quote, in charge. there are several agencies throughout the federal government that have equities in this and we are working together to try to integrate that process. it clearly is something that needs to be addressed and addressed as quickly as possible. you and i have had a number of discussions about that. and so we are keen on moving forward in terms of not only identification, but relative response and things that we can do to prevent this from happening. we are gaining more i think support i guess is the right word from the private sector who are beginning to recognize ever more the issues that are faced with the material that comes through their processes. we cannot as a government direct them what to do. but we certainly are spending every effort we can to work with them to provide some answers to this question. >> i would agree with director coats. it is a team effort. one of the things that has jumped out at me being back in government is how much more of a team the intelligence community is than the last time i was in this space. i have one of mike's people who sits right in my inner team and vice versa and we're dealing with each other every day. so it is teamwork within the intelligence community and partnership with the private sector, the other big change i've noticed. a lot more forward-leaning engagement with the private sector to share information and raise awareness on their end. we can't fully police social media. we work with them to police themselves. >> i think the companies themselves were slow to recognize the threat and more work to do. the fact that we don't have claire fee in terms of who is in charge we don't have a full plan. let me get one last question in quickly on the rise chairman alluded to this as well. the rise of chinese tech companies and i know senator cornyn and feinstein from legislation. my fear is some of these chinese tech companies may not have to acquire an american company before they become pervasive in our market. again i'll start with director coats and director wray. how do we make sure we send a signal to the private sector before some of these companies in effect totally invade our market particularly so many are tied back to the chinese government? >> it is not only sending the signal and working together sharing information with the private sector and the public sector. it also, i think, involves almost the whole of government issue in particular with the legislation being looked at in terms of the sif yas process. we need to go what the current process is in terms of evaluating. we will coordinate our intelligence to provide policymakers and those that are making these decisions with the best intelligence we can relative to what the situation is. and so we had this and view this as a top priority and it's ongoing because as i mentioned in my early remarks here, the chinese are pervasive on this and we've seen it happen throughout both the public and the private sector. >> we've tried very hard to be more out and about in the private sector in terms of providing what are almost like defensive briefings. so that some of the u.s. telecommunications companies, among other technology industry members, kind of can recognize the threats that are coming their way and i think i've been pretty gratified by the response that we've gotten by most companies once we're able to try to educate them. one of the bigger challenges we face is because america is a land of innovation there is exciting stuff that's happening in terms of smaller startup companies. a lot of them are less sophisticated about some of this stuff and trying to make sure we are touching those and educating them as well is a continuing challenge. the reality is that the chinese have turned more and more to more creative avenues using non-traditional collectors which i think we in the intelligence community recognize but the private sector is not used to spotting. a lot of it is trying to educate them about what to be on the lookout for and have it be more of a dialogue. >> senator rich. >> thank you very much. first of all, i want to associate myself with remarks of the vice chairman when he said this committee will always have your backs. for those of you who have been associated with this committee and since you used to sit here and dr. pompeo you ran the same operation across the way and you guys seem like part of the committee we see you so much up there. you know that that's the case and we sincerely appreciate that. i would say, however, and every one of us here knows what a tough job each of your agencies have. i'm speaking for myself and i suspect for most if not all of the committee we have absolute 100% confidence in your ability to in a very neutral, dispassionate fashion deliver to us the facts we need in order to make the policy decisions. one of the things that does rear its ugly head occasionally and causes issues and that winds up in the media a lot more than it should is when your jobs intersect with domestic political affairs. mr. wray probably you will wind up with this more than anybody else. it gets messy and difficult. i think we've all got to recommit ourselves to what we're actually doing here to reach the right facts. i would respectfully disagree with my good friend from virginia that we are no better prepared to handle the russians onslaught than we were in 2016. when this happened in 2016, those of us on this committee, those of you at the panel and most of you -- most everyone who works in the i.c. were not surprised to find out that the russians were attempting to meddle in our affairs. i think probably one of the best hearings we've had this year was the open hearing we had on how they used social media and we saw how disjointed it was, how ineffective it was, how cheap it was for them to do that. but i think after that, with all due respect to my friend from virginia, i think the american people are ready for this. i think that now they are going to look a lot more at the information that is attempted to be passed out through social media. the american people are smart people. they realize that there are people attempting to manipulate them both domestically and foreign. and i agree with everybody on the panel. this is going to go on. this is the way the russians have done business. no surprise to us. we saw it more so than we got it in france and germany in the past year. i think the american people are much more prepared than what they were before. dan, thank you for that analysis of syria. i doubt it made it any clearer for me or for the american people. it is a rubics cube that is very difficult and after this last weekend i think got even more complicated. and i think that we are going to have to keep an eye on that and i agree with you cyber is certainly something right at the top. the financial condition of this country is of critical importance to us. i want to close and i want to ask a specific question to four of you regarding korea. i think that's the most -- i think it's something at our doorstep. a year ago when we talked about this it was then, this is now. the movement of north korea has not slowed down. in fact, if anything, i think all of us would agree it's probably picked up. it is at our doorstep. this will have to be dealt with in the very, very near future. we have talked about trying to engage in conversations and what conditions would be, etc. i think we're still in the process of refining that but that's moving. we've all watched over the last week the smile campaign that north korea has had inflicted on the south korea people. the south korea people seemed to be charmed by it to some degree. some seem to be captivated by it. from my point of view i think it's nothing more than a stall by the north koreans to develop what they're trying to do and in my judgment i think we need to be very, very cautious of this. director coats, pompeo, rogers and ashley, i would like to hear your view of this supposed turn in the last couple of weeks by the north koreans. >> well, this is an threat to the united states but also to north korea. kim jong-un views this as any kind of kinetic attack or effort to force him to give up his nuclear weapons is a threat to his nation and to his leadership in particular. as you know, it's a very hard topic, collection nation, given their secrecy and so forth but we do know that kim -- it's a one-man decision. we have processes in place here in the united states to have multiple engagements with various agencies in terms of our policy making and relative to the decision that ultimately the decision the president makes. it doesn't appear to be the case in north korea. the provocative nature, the instability that kim has demonstrated potentially is a significant threat to the united states. i agree with you that decision time is becoming ever closer in terms of how we respond to this. our goal is a peaceful settlement. we are using maximum pressure on north korea in various ways which can be described by my colleagues here. most of that in closed session. but we have to face the fact that this is an existential problem for the united states. >> wise words. >> the last part of your question about this past now almost week at the olympics, we should all -- american people should all remember that kim yo jong is the head of the propaganda and agitation department. there is no indication there is any strategic change in the outlook for kim jong-un and his desire to retain his nuclear capacity to threaten the united states of america. no change there. >> i would just say if kim thinks he can splitter the relationship between us and the south koreans he is mistaken. >> no change to his strategic calculus. under his regime you've seen a deliberate effort in terms of readiness. different from his father. his army trains in a deliberate fashion. his calculation is deliberate. >> thank you very much, i want to associate myself with some of the comments of senator rich and we just had a secure briefing last week and i think it was difficult and harsh. i harken back to the words of the secretary of state. one we do not seek regime change. two, we do not -- we are not seeking the accelerated reunion of the peninsula, and finally, that we will not bring u.s. forces north of the demilitarized zone if the korean peninsula is reunified. let me ask you, mr. pompeo, because you just spoke with some certainty. does kim jong-un really understand and believe that our goals are not regime change or regime collapse? >> senator feinstein, i can't give you any certainty about what kim jong-un actually subjectively believes. very difficult intelligence problem anywhere in the world, most especially difficult there. and i have expressed this before. we do remain concerned. our analysts remain concerned that kim jong-un is not hearing the full story. that those around him aren't providing nuance or suggesting to him the tenuous nature of his position both internationally and domestically. the breach with china. deep con -- connections. we're not certain the leaders around them are sharing that information in a way that's accurate, complete and full. >> in a recent "washington post" op-ed victor shaw, who was recently under consideration to be united states ambassador to south korea warned of the dangers of a preventive united states military strike against north korea. he cautioned that such a strike would not halt north korea's nuclear weapons program and could spark an uncontrolled conflict in the region that could kill hundreds of thousands of americans. he is not the only one. a number of experts on the area have said that. and he argued to continue to press for multi-lateral sanctions, that the u.n. to provide japan and south korea advanced weapons training and intel, and some other things. has the intelligence community assessed how the north korean regime would react to a preventive united states attack? >> we have. i would prefer to share that with you in closed session this afternoon. >> would you do that this afternoon, please? >> absolutely. we have written about various forms of actions. what we analyze, the certainty and uncertainty we have around that analysis as well as what we think happens in the event that the united states decides not to do that and continues to allow kim jong-un to develop his nuclear weapons arsenal. >> have you explored what it would take to bring them to the table? >> we have. i would prefer to share that with you in closed session, yes ma'am. >> tell us that this afternoon as well. thank you, mr. chairman. >> senator rubio. >> thank you all for being here. i also echo the same words everyone else has shared with you about the esteem we have for all of our agencies and the important work they do. i think this has already been touched upon. i do believe that russia, vladimir putin in particular efforts around the world a very important. the biggest issue of our time in my view and the view of most of the members of this committee and venture to guess most of the members of this panel is china and the risk they pose. i'm not sure in 240 some odd year history in the nation we've ever faced a competitor and potential adversary of this scale, scope and capacity. it is my personal view and shared by many people that they are carrying out a well orchestrated and well executed very patient long-term strategy to replace the united states as the most powerful nation on earth. you see it in the words community of common destiny. a retreat from western values of democracy and freedom and openness towards some other model that benefits them and their pursuit of this appears to be every element of their national power. their military, commercial, trade, economics, information and media. the tools they use are everything from hacking into companies and critical infrastructure and defense contractors, everybody you can imagine to using our immigration system against us, to even our universities and that's where i wanted to begin this week. let me just ask this and i would start with this director coats. is it your view the united states today as a government is prepared for the scale, scope and magnitude of the challenge presented by this plan that china is carrying out? >> we have full awareness of what the chinese are attempting to do on a global basis. there is no question that what you have just articulated is what is happening with china. they're doing it in a very smart way. in a very effective way. they are looking beyond their own region. i think they have -- it's clear they have a long-term strategic objective to become a world power and they are executing throughout the whole of government ways in which they can accomplish that. we have intensive studies going on throughout the intelligence community relative to a to z on what china is doing. general mattis has asked us for that. others have asked us to provide that. senator warner called me last week. we had a discussion on that. i assured him that we are pulling all of our elements of intelligence gathering together to provide a very, very deep dive into what china is doing now and what their plans are for the future and how it would impact on the united states. >> just to highlight the different ways in which they're pursuing this plan director wray let me ask you what could you say in this setting is the counter intelligence risk posed to u.s. national security from chinese students and advanced students in science and mathematics. >> i would just say the use of non-traditional collectors especially in the academic setting whether it's professors, scientists, students, we see in almost every field office that the f.b.i. has around the country. not just in major cities, it's in small ones as well across every discipline. and i think the level of naive tay on the part of the he can dem i can sector -- they exploit the very open research and development environment that we have, which we all revere, but they are taking advantage of it. so one of the things we're trying to do is view the china threat is not just a whole of government threat but a whole of society threat on their end and it will take a whole of society response by us. it is not just the intelligence community but it is raising awareness within our academic sector, within our private sector as part of the defense. >> in that vein i wrote a letter about the confucius institute at u.s. schools. they are complicit in these efforts to influence public opinion and to teach half truths designed to present chinese history, government or official policy in the most favorable light. do you share concerns about confucius institutes as a tool of that whole of society effort and as a way to exploit the sort of naive view among some in the academic circles about what the purple of these institutes could be? >> we share concerns about that. we've been watching that development for a while. it is just one of many tools that they take advantage of. we have seen some decrease recently in their own enthusiasm and commitment to that particular program. it is something that we're watching warely and in certain instances have developed appropriate investigative steps. >> thank you, mr. chairman. vice chairman warner highlighted in his opening statement the importance of an effective security clearance process. so i have a question for you, director wray. was the f.b.i. aware of allegations related to rob porter and domestic abuse? and if so, was the white house informed this could affect his security clearance? when were they informed? and who at the white house was informed? >> well, senator, there is a limit to what i can say about the content of any particular background investigation for a variety of reasons that i'm sure you can appreciate. i would say that the background investigation process involves a fairly elaborate set of standards, guidelines, protocols, agreements, etc. that have been in place for 20 plus years. and i'm quite confident that in this particular instance the f.b.i. followed the established protocols. >> so was the white house informed that this could affect his security clearance? that's a yes or no. >> i can't get into the content of what was briefed. >> were they informed? >> what i can tell you is that the f.b.i. submitted a partial report on the investigation in question in march. and then a completed background investigation in late july that is soon thereafter we received requests for follow-up inquiry and we did the follow-up and provided that information in november, and that we administratively closed the file in january and then earlier this month we received some additional information and we passed that on as well. >> okay. let me turn now to the two recent arbitrary and inconsistent decisions that affect the politicizing of the classification system. the first was the public release of the nunes memo. the second involved the report that the congress required on russian oligarchs, their relationship with president putin and corruption. in that case the secretary of treasury released nothing other than a list of rich russians taken from public sources. my question and any of you can respond. did any of you take a position on either of these two arbitrary classification decisions? and did any of you have any communications with the white house about either of those classification matters? >> i'll start. the answer is no. >> no. >> i raised concerns on this issue with the dni. >> no. the cia was not asked to review the classification of those documents. >> not on the second. the oligarch treasury document. we did have interaction about the memo from chairman nunes. >> is there anything you can say that protects sources and methods in an open session with respect to that matter? >> well, i would just say, as we said publicly, we had grave concerns about that memo's release. >> okay. on encryption, director wray, as you know, this isn't a surprise because i indicated i would ask you about this. you have essentially indicated that companies should be making their products with back doors in order to allow you all to do your job and we all want you to protect americans and at the same time sometimes there is these policies that make us less safe and give up our liberties. that's what i think we get with what you all are advocating, which is weaken -- weak encryption. i don't pretend to be an expert on this field. but i think there is a clear consensus among experts in the field against your position to weaken strong encryption. so i have asked you for a list of the experts that you have consulted. i haven't been able to get it. can you give me a date this afternoon when you will give -- this morning a sense of when we will be told who are these people who are advising you to pursue this route? because i don't know of anybody respected in the field who is advising that it is a good idea to adopt your position to weaken strong encryption. can i get that list? >> we would be happy to talk more about this topic this afternoon. my position is not that we should weaken encryption but we should be working together, government and private sector, the try to find a solution that balances both concerns. >> i'm on the program for working together but we need to be driven by objective facts and the position you all are taking is out of sync with what all the experts in the field are saying and i would just like to know who you all are consulting with and we'll talk more about it this afternoon. thank you, mr. chairman. >> senator collins. >> thank you. director pompeo, last week "the new york times" published a report that alleged that you as intelligence officials had paid $100,000 to a russian source for phony secretsuding potentially compromising information about the president and information on certain tools allegedly stolen from the nsa. first, is it accurate that the c.i.a. has categorically denied the assertions in this story? and second, if so, what would be the motivations of a russian who peddled this story to the "new york times" and other western media outlets, since this part of the russian campaign to undermine faith in western democracies? >> senator, let me say thanks for the question. reporting on this matter has been rid i can laos and inaccurate. the people swindled were the authors of those two pieces. it is our view that the same two people who were offering phony information to the united states government gave that same phony information to these two reporters. the central intelligence agency did not provide any resources, no money to these two individuals who proffered u.s. government information directly or indirectly at any time. and the information that we were working to