Struggles Inside the Government Defined
Campaign
By Barton Gellman
Washington Post Staff Writer
Thursday, December 20, 2001; Page A01
Second of two articles
In his last year as CIA station chief in Sudan, Paul Quaglia lived no more than a mile from Osama bin Laden.
It was 1995. The al Qaeda leader's residence was not on the way to the U.S. Embassy, but Quaglia preferred to vary his daily commute. Sometimes he drove right past the three-story brick and stucco home, sport utility vehicles standing sentry outside. When the two men crossed paths at the airport, Quaglia gazed with frank curiosity at the tall Saudi Arabian in the VIP lounge, "surrounded by security guys, openly armed, wearing those long white flowing robes."
The face of international terror had begun a dangerous transformation in the early 1990s, and the U.S. government knew but little of bin Laden's part in it yet. Terrorism was still, by presidential directive, a third-tier national security issue.
President Bill Clinton and his advisers reached a pivot point in their grasp of the terrorist threat by the end of 1995. In his second term, the president reshaped his government in response. By degrees the national security establishment shifted its view of terrorism from tactical nuisance to strategic challenge, sharpening its focus on bin Laden after the 1998 embassy bombings in East Africa.
By any measure available, Clinton left office having given greater priority to terrorism than any president before him. His government doubled counterterrorist spending across 40 departments and agencies. The FBI and CIA allocated still larger increases in their budgets and personnel assignments. Clinton devoted some of his highest-profile foreign policy speeches to terrorism, including two at the U.N. General Assembly. An interagency panel, the Counterterrorism Strategy Group, took on new weight in policy disputes from the Justice Department to the Centers for Disease Control and Prevention. And the foreign policy cabinet, by the time it left office, had been convening every two to three weeks to shape a covert and overt campaign against al Qaeda.
But neither Clinton nor his administration treated terrorism as their top concern, because it was not. Without the overriding impetus provided by Sept. 11, the war on terror in the 1990s lost as many struggles inside government as it won. Steps to manage risk moved forward readily. Some of the harder initiatives, hurried through these past three months by President Bush, foundered then on money, bureaucratic turf, domestic politics and rival conceptions of national interest.
The Treasury Department declined to monitor money transfers outside the formal banking system, such as the hawala network used by bin Laden's operatives, and opposed funding for a White House-sponsored National Terrorist Asset Tracking Center. The department strongly cautioned against proposals for covert action against bin Laden's financial accounts, arguing that the United States should be the foremost defender of the norm that cyberattacks on banks are themselves acts of terror.
FBI investigators, who knew as much then as they do now about some domestic fundraising sources for foreign terror, were prevented from opening criminal or national security cases for fear that they would be seen as "profiling" Islamic charities.
In two of the countries of central concern &endash; Pakistan and Saudi Arabia &endash; terrorism seldom rose higher than third place on the agenda when Clinton and his Cabinet secretaries sat down with their counterparts.
Even in Afghanistan, a country that otherwise held no strategic interest for the United States, the Clinton administration chose not to exhaust its available carrots and sticks with the Taliban regime that sheltered bin Laden from 1996. To induce the Taliban to hand over bin Laden, Clinton offered neither the incentive of normal relations nor the threat that he would back armed opponents of consolidated Taliban rule.
Beneath every trade-off lurked the incontestable fact that terrorism on the grand scale remained a hypothetical danger through Clinton's final day in office. In the 1980s and 1990s, 871 Americans died in terrorist attacks at home and overseas, an average of not quite 44 a year. In actuarial terms, chicken bones were deadlier. Colleagues told Paul R. Pillar at the CIA's counterterrorism center, he wrote later, that "fewer Americans die from it than drown in bathtubs."
That was not, said Samuel R. "Sandy" Berger, Clinton's second national security adviser, the view from the top. "Terrorism didn't start in 1993 with the World Trade Center," he said. "We had the Lebanon Marine barracks, the Lebanon embassy, hijackings, the Achille Lauro and Pan Am 103" in the 1980s. "I think the Clinton administration was the first administration to undertake a systematic anti-terrorist effort &endash; organizationally, in terms of resources and in terms of anti-terrorist activity."
Presidential Decision Directive 35, which remains classified, set out the Clinton administration's intelligence collection priorities on March 2, 1995. Terrorism came in the third tier, after support for ongoing military operations and analysis of potential enemies in Russia, China, Iraq and Iran.
This actually represented an elevation in status for a danger that had seldom been granted much respect. At the time, James B. Steinberg held one of the few senior posts in government charged with thinking about national security on a horizon measured in years. As director of policy planning in the State Department, he commissioned a series of cables on what threats the United States might face after the collapse of the Soviet Union.
Drugs, crime, terrorism and weapons proliferation emerged in these cables, he said, as "the dark side of globalization." Analysts called them the "transnational threats."
"From 1995 and 1996 on, you can see this rising curve of urgency and attention," Steinberg recalled.
Terrorists, and terrorism, were changing. Some of the secular, leftist radicals that made their names in the 1970s &endash; Red Brigades, Direct Action, the Communist Combatant Cells &endash; had faded away.
But if less numerous, terrorists grew more lethal. No longer was it true, as Brian Jenkins wrote in the Futurist in 1987, that they "want a lot of people watching, not a lot of people dead."
It took 267 attacks in the United States to kill 23 people in the 1980s. The 10 years that followed saw many fewer attacks &endash; only 60 &endash; but nearly nine times the casualties &endash; 182. A single bombing on April 19, 1995, which ripped the face off the Alfred P. Murrah Federal Building in Oklahoma City, accounted for 168 of the dead. The same trend held overseas: fewer attacks, more lives lost.
Most commonly driven by religious zeal, the new terrorists sought to inflict mass casualties. Those who studied them, including Bruce Hoffman at the Rand Corp., tracked a corresponding improvement in their operational competence. Islamic extremists had come to dominate the 10-year war that drove the Soviet Union out of Afghanistan in 1989. Hard on their victory, they characterized the Persian Gulf War of 1990 and 1991 as a second invasion of the Islamic world by an infidel superpower.
Jihadist terror, as government experts began to call it, came to America just as Clinton took office in 1993.
Sheik Omar Abdel Rahman, convicted of plotting that June to bomb the United Nations, the FBI's New York office and the Lincoln and Holland tunnels, provided a window into the new adversary's intent. Trial evidence described his instructions to "break and destroy the morale of the enemies of Allah" with attacks on "their high world buildings . . . and the buildings in which they gather their leaders."
Ramzi Yousef, a follower, killed only six people when he bombed the World Trade Center five weeks after Clinton reached the White House. He had spent $400 on ammonium nitrate and fuel oil to fashion the Feb. 26, 1993, truck bomb. But little-noted testimony of the building's engineers suggested later that, with two or three times the budget, Yousef might have killed tens of thousands in the towers' sudden collapse.
Former senator Bob Kerrey (D-Neb.), who sat on the Senate Select Committee on Intelligence until early last year, said of the attitude inside the committee: "We thought we were pretty hot. I mean, [the 1993 truck bombers] went back to Ryder to ask for their deposit back! How stupid are they? We were just too complacent."
The United Nations celebrated its 50th anniversary in 1995. Clinton devoted his marquee address on Oct. 22 to the cross-border threats his advisers kept talking about, including terrorists who had "plotted to destroy the very hall we gather in today."
He named all four horsemen, not perhaps of apocalypse, but of America's new unease: "international organized crime, drug trafficking, terrorism and the spread of weapons of mass destruction." The list came roughly in order of his attention. Money laundering took center stage, and Clinton's only concrete move that day was to seize assets of the Cali drug cartel in Colombia.
At the Warwick Hotel a few blocks away, Richard A. Clarke of the National Security Council staff briefed reporters. The mafia had its FBI, and the drug war had its czar. As yet the war on terror had no such central command. But Clarke had begun to create one in the Old Executive Office Building.
Clinton's first guiding directive on terrorism, a few months before, had given lead responsibility to the FBI for hunting terrorists. To coordinate the scores of offices elsewhere that had some claim to a counterterrorist role, Clinton also named an alphabet soup of interagency panels. A congressional report noted that these panels had to "operate on a consensus basis, do not have decision-making authority, and do not establish government-wide resource priorities."
No one appeared to have told Clarke any of that. By force of personality, he used his gavel in the Counterterrorism Strategy Group to hammer unusually rapid change through large government organizations. In the next five years, he would roll over a formidable array of bureaucratic foes, interjecting himself in programming and personnel decisions that the executive departments saw as sovereign.
"Dick gets things done," Berger said. "He is a pile driver."
Three weeks after Clinton's U.N. speech, on Nov. 13, 1995, a powerful explosion destroyed an American-leased office building in Riyadh where U.S. soldiers trained the Saudi Arabian National Guard. Five Americans died. Next came a much larger bomb, this one fabricated into a Saudi tanker truck. Reverberating audibly as far away as Bahrain, the June 25, 1996, detonation killed 19 Americans at the Khobar Towers dormitory for servicemen assigned to the King Abdul Aziz Air Base.
These episodes, and a set of near-catastrophes just before them, raised new alarms in Washington.
Yousef, the World Trade Center bomber, had been caught in Pakistan, but not before reaching advanced stages of planning for the synchronized destruction of a dozen commercial airliners over the Pacific. In Tokyo about the same time, the Aum Shinrikyo cult killed 12 subway passengers with sarin nerve gas that, dispersed effectively, would have killed many of the 5,700 who fell ill.
"Terrorism is the enemy of our generation, and we must prevail," Clinton told an Aug. 5 audience at George Washington University. But he added a proviso: "While we can defeat terrorists, it will be a long time before we defeat terrorism." Clinton did not foresee decisive victory. The task was to manage terrorism as an unavoidable feature of the global landscape.
"In light of September 11th, we ought to do some soul-searching," said Michael A. Sheehan, who served as Clinton's last assistant secretary of state for counterterrorism. "That's what I'm doing. But it has to be said that it was the collective judgment of the American people, not just the Clinton administration, that the impact of terrorism was at a level that was acceptable."
To prevent an unbearable increase would require fresh resources to match the ambitions of the new jihadist threat. Clarke oversaw the infusion.
Spread over so many departments and agencies, the aggregate spending on terrorism was hard to sort out. But the best estimates of the Office of Management and Budget showed an increase from $5.7 billion in fiscal 1996 to $9.7 billion in 1999 and $11.1 billion in 2001.
The money went to hundreds of programs from pathogen research and medical stockpiling to training of "first responders" to biological and chemical attacks. Large increases went to law enforcement and intelligence gathering.
Terrorism accounted for less than 4 percent of the FBI's resources at the start of the Clinton administration and more than 10 percent at the end, according to unpublished Justice Department data. The CIA's counterterrorism center nearly tripled in budget and personnel, sources said, though its managers complained that the numbers changed capriciously with the ebb and flow of White House and congressional urgency.
In the aftermath of twin truck bombs that destroyed U.S. embassies in Tanzania and Kenya on Aug. 7, 1998, the most urgent priority for the Clinton administration was hunkering down.
"Really, this was the first thing you thought about in the morning," said James Bodner, one of Defense Secretary William S. Cohen's top policy aides. "If it was the morning, and you hadn't been woken up [by a call], you knew there had not been an attack." Everyone involved, he said, saw the need to take the offensive because defense was so hard: "You've got to bat a thousand, whereas the other guy only needs to get one single every year."
But fully half of the counterterrorist budget in Clinton's last 29 months went to increased security at overseas posts, military or diplomatic. Counting comparable measures domestically, the proportion surpassed three-fourths.
Long after the embassy bombings, Secretary of State Madeleine K. Albright held a daily 8 a.m. meeting at Foggy Bottom with her chief of diplomatic security. David Carpenter, who had come to State from the Secret Service presidential detail, walked Albright through more than 650 threat reports in the seven months after the Aug. 7 attacks. "Our analysts believe that about 33 percent of these threats are 'viable' threats," he reported in March 1999.
Carpenter and Albright dispatched Emergency Security Assessment Teams, Security Augmentation Teams, Mobile Training Teams. They hired more than 1,000 new guards and built countless vehicle barriers and blast walls. They deployed 53 bomb detection units, 98 "back-scatter" X-ray systems, 200 closed-circuit recording cameras and 600 metal detectors.
The State Department also mandated "duck-and-cover practice drills," as recommended by retired Adm. William Crowe's Accountability Review Board after the embassy bombings, "in order to reduce casualties from vehicular bombs."
These defensive improvements, in the State Department alone, cost twice the combined spending of the FBI and CIA counterterrorism programs. The Pentagon's defensive improvements were nearly three times again as expensive as State's.
In the Joint Chiefs of Staff, there was a counterterrorism directorate, but its mission was not to hunt and kill terrorists. No one on the Joint Staff had that as a primary mission. The directorate managed efforts to make U.S. troops abroad more difficult to strike.
Joint Publication 2000.12H gave the authoritative direction to all military services on "defensive measures taken to reduce vulnerability to terrorist attacks." Uniformed services bought window laminates engineered to withstand explosive blasts without sharding, armored tactical rescue vehicles, portable tire deflation systems. They ordered body armor for their security dogs.
The Clinton administration felt obliged to buy all this protection for employees it dispatched around the world, but it had little confidence in the strategy. Steinberg, who had become deputy national security adviser, said later that "the adversary can see what you're hardening and directs his efforts somewhere else." It is, he said, a "horrible game where offense always outstrips defense."
No issue frustrated Clarke more than his inability to open an effective financial front in the war on terror, according to regular participants in his Counterterrorism Strategy Group.
"He wanted to identify assets and freeze them," a colleague said. "He couldn't get the interagency process to move."
A central irritant was the government's antiquated approach to tracking money. On the day of his 1995 U.N. speech, Clinton had directed Treasury to lead an initiative to disrupt new techniques of illicit financial transfer. Three years later, there had been no progress.
Treasury's Financial Crimes Enforcement Center, known as FinCEN, geared itself to 1980s-style money laundering. It took reports from chartered banks on large cash transactions and suspicious activity by customers. But for years, it had put off writing regulations to give it comparable oversight of other money service businesses.
William Wechsler, who chaired Clarke's working group on terrorist finances, said that by January 1999, his group identified informal, unregulated money transfers "as being a really significant problem." The principal concern was a type of channel originating in the Middle East and South Asia, called hawala, from the Arabic word for "change" and the Hindi word for "trust."
Hawala offered a method of transferring money across international borders without physically moving it, relying on trusted partners on each side. To send money to Pakistan, for example, a person could hand cash dollars to a tea shop owner in Brooklyn. The shop owner would call a relative in Pakistan with instructions, and the relative would pay out the sum in rupees at the other end.
Hawala appeared to create a vulnerable point of entry for al Qaeda operational funds into the United States. White House officials could find no government agency willing to police it.
As it happened, FinCEN had one of the world's preeminent experts. Patrick Jost, a jazz musician whose Virginia vanity license tag reads "HAWALA," spoke Gujarati, Hindi and Urdu. He had teamed with Interpol's senior authority to write a primer on alternative remittance systems. But when U.S. law enforcement agencies approached him for advice on monitoring the shadowy transactions, Jost's managers instructed him to decline.
Director James Sloan and chief of operations Connie Fenchel, he said, "did not want FinCEN to pursue this line of work." Made to feel unwelcome, Jost left government in June 2000.
"It was infuriating," Wechsler said.
(The Bush administration shut down two hawala operators in the United States as part of a crackdown on al Qaeda financial assets on Nov. 8.)
One member of the Counterterrorism Strategy Group remembers Clarke "pounding on tables and railing about the Holy Land Foundation," a Texas-based charity whose accounts were seized this month after years of government debate. FBI eavesdropping at a Marriott Courtyard hotel in Philadelphia as long ago as 1993 linked the foundation to Hamas, the most active Palestinian terrorist group against Israel.
But investigators at the bureau felt handcuffed. After preparing the case, one of them said, they were refused permission to take the next steps. The Texas charity, like the Hamas political leadership, maintained it concerned itself only with social services.
"There was a lack of political will to follow through and allow investigators to proceed on the case, despite the fact that all of the i's were dotted and the t's were crossed," said a government analyst who reviewed it. "You have a front organization that you know is contributing to terrorists, with extremely solid intelligence information, but it is also making charitable contributions, and that is its ostensible purpose. When I say political, I mean we can't have the public come out and saying we're bashing Muslims."
During 1999, Clarke persuaded Clinton to establish an interagency terrorist asset tracking center, headquartered at Treasury. With no role in law enforcement, it could draw from and feed to intelligence arms such as the CIA's Illicit Finance Group. At the Coast Guard Academy on May 17, 2000, Clinton announced its creation. He was premature.
It was not until this September &endash; the week of the hijacking calamity &endash; that a reluctant enforcement division at Treasury was persuaded to form the new team.
In meetings of Clinton's Cabinet-rank national security officials, Defense Secretary Cohen and Gen. Henry H. Shelton, chairman of the Joint Chiefs of Staff, complained repeatedly that the government was not bringing its financial leverage to bear on bin Laden's network.
"We knew where the front organizations were," Shelton said in an interview. "We know today. If we allowed the money to continue to pour in, that was something we were giving them as a freebie."
According to sources, the two Pentagon leaders favored an aggressive campaign of covert action against financial accounts and centers owned by al Qaeda.
The government was capable of manufacturing "all the indices of authentication" needed to make a validated withdrawal from a terrorist account, said one person who participated in the internal debates. It was also capable, some advocates believed, of raining electronic havoc on a business or financial institution as a whole.
Participants in the debate recall it as largely hypothetical, with doubters wondering whether such an attack could be launched to good effect.
But Treasury Secretary Robert Rubin took a strong stand against the idea in principle. As the world's preeminent financial center, he said, the United States had the strongest interest in maintaining a global norm that cyberattacks on banking systems are acts of war. The United States could not defend that principle if it engaged in such attacks, and its own vulnerabilities would be substantial.
Sheehan, the State Department's counterterrorism coordinator, arrived in the job not long after the 1998 embassy bombings. He concluded almost immediately that al Qaeda could not be defeated cell by cell.
A 1977 West Point graduate, Sheehan had been counterinsurgency adviser in El Salvador and a leader of U.S. Special Forces teams in Panama. He saw law enforcement and intelligence as essential tools but argued that on their own, they made for "a defensive, marginal strategy, like swatting mosquitoes." Sheehan's image later entered the public idiom of the terror debate. Washington, he wrote, needed a strategy to "drain the swamp."
Terrorists could not operate without sanctuary and state support. To remove them, he wrote in a classified 30-page cable, would require substantial changes of behavior by five key states: Afghanistan, Pakistan, Saudi Arabia, the United Arab Emirates and Yemen. Only the top leaders of those countries could make the necessary political decisions, he wrote, and only the highest-ranking American leaders could engage them.
What Sheehan proposed in effect was to place terrorism at or near the top of the agenda whenever Clinton, Albright or Cohen spoke to their counterparts. That is what happened under Bush after Sept. 11. But for Clinton, in the times in which he governed, the proposal was out of the question.
Shelton, the retired Joint Chiefs chairman, said, "If you didn't talk to the emir or the king, it was probably not going to happen." The only way to have stopped the flow of money from the Persian Gulf to al Qaeda, he said, was to say, "Ç'If you're not with us you're against us,' and not from some deputy secretary or some third assistant going to the finance ministry."
Clinton's overarching priority in the Middle East, and the animating foreign policy goal of his presidency, was peace between Israel and its neighbors. Martin Indyk, who advised him at the White House and as assistant secretary of state for Near Eastern affairs, described terrorism's inverse relationship to success at the bargaining table.
"After the Gulf War and the collapse of the Soviet Union, there was a very real sense of a window of opportunity to achieve a comprehensive peace in the Middle East," he said. "That became the priority. The assumption was that if you could achieve that kind of breakthrough, it would have a transforming effect on the whole region." That, in turn, would "deal a blow to those who opposed the peace process, particularly using terrorism to do so."
The Saudis gave direct financial aid to the Taliban, but the royal family held no brief for bin Laden. He had been stripped of his Saudi citizenship for, among other things, accusing King Fahd of inviting crusaders to defile the land of the two holy mosques.
Washington hoped that Riyadh would use its influence to drive a wedge between the Taliban and bin Laden's network, the easiest course. When that did not work, the Clinton administration urged the royal family to cut two kinds of financial ties: direct Saudi aid to the Taliban, and the thick web of contributing relationships from charities, religious schools known as madrassas and influential princes to al Qaeda.
"The most we got out of them was that they stopped the direct funding in 1999 and downgraded their relations" with the Taliban from ambassador to charge d'affairs, Indyk said. When Americans asked for information about private contributions to al Qaeda, another senior American said, "the Saudis wanted account numbers" before they would answer.
Clinton flew to Islamabad, over vehement Secret Service objections, on March 25, 2000. The Secret Service assumed that bin Laden's network, based across the border in Afghanistan, still had the shoulder-fired Stinger missiles the United States had provided to the anti-Soviet mujaheddin in the 1980s. Air Force One flew ahead of Clinton as a decoy. The president slipped into Pakistan in an undignified tactical landing that bounced him hard in the seat of his unmarked jet.
Pakistan held the key to bin Laden. It had pressure points and hopes of better ties with Washington, it shared a long, porous border with Afghanistan, and it had some interests even stronger than its considerable investment in the Taliban. Without Pakistan, the Taliban would have no meaningful ally left. Without the Taliban, bin Laden might be finished.
Clinton was arriving in a political maelstrom. The previous October, Gen. Pervez Musharraf had seized power from the elected prime minister, Nawaz Sharif, who was a friend of the United States. Critics in Congress were livid at any visit at all, calling it legitimation for a coup.
Apart from that, there was a war on between Pakistan and India in Kashmir, a potentially explosive mix of nationalism and religion. And not least, they were the world's newest nuclear powers &endash; the only ones sharing a hostile border.
How to choose among democracy, war, terrorism and nuclear miscalculation &endash; in a meeting with Musharraf lasting an hour and 40 minutes? Clinton did not choose. He spoke of them all, according to records and recollections of those present. Two participants said separately that terrorism came third.
Contacts with Pakistan over the Taliban, known formally as demarches, had been much the same for a long time. The United States would ask Pakistan to use its influence to deliver bin Laden. Pakistan would say it was trying. Critics inside the Clinton administration called these "demarche-mallows" &endash; soft and insubstantial.
In person, Clinton told Musharraf that "he thought terrorism would destroy Pakistan from within" if the government did not take firm control of al Qaeda, said an American in the room. But Clinton, the American said, expected no substantial reply: "It just wasn't in the cards." Because of mandatory congressional sanctions against Pakistan, "our carrots were pretty chewed up," and "there wasn't much left that we could cut off."
The Clinton administration had much the same analysis of the Taliban after cutting off its air links and winning U.N. backing for limited sanctions. In demanding custody of bin Laden, Clinton's advisers found themselves with little to offer or threaten the Islamic fundamentalist regime.
After visiting an Afghan refugee camp in northern Pakistan in late 1997, Albright had described the Taliban regime as "despicable" in its treatment of women and girls. Hillary Rodham Clinton joined the attack, and the human rights issues far eclipsed bin Laden in most commentary about the regime. When Taliban representatives asked Americans what would happen if the bin Laden problem were resolved, the best the Americans could do was say "a boulder would be removed" from the path to better ties.
"I did say, and I was absolutely right, that what they were doing to the women was despicable," Albright said recently. "We decided that they could not be recognized because of all the things they were doing to suppress their own people."
During much of this period, the Taliban was struggling to complete its conquest of Afghanistan, with the Northern Alliance hanging on to about one-third of the territory. The Clinton administration joined the "six plus two" process in which Afghanistan's neighbors, together with Moscow and Washington, tried to broker an end to the civil war.
Though trying to bring pressure on the Taliban, Clinton's advisers rejected proposals to interfere with the regime's consolidation of power. The United States maintained its position in favor of what Assistant Secretary of State Karl F. Inderfurth called "a broad based, multiethnic government" long after it was clear the Taliban had the will and the means to win a victory outright.
Interceding on the side of the Northern Alliance would have meant backing the losing side and casting lots with corrupt and brutal militias, a former official said &endash; not "white knight versus black knight" but "dark gray knight against black knight."
Albright said the idea was unworthy of serious thought.
"We all were operating with the history of Afghanistan and the unintended consequences of getting involved" in the 1980s, Albright recalled. "We armed all those people and provided them with the Stingers. For us to get involved in a civil war on behalf of the Northern Alliance would have been insane."
Researcher Robert Thomason contributed to this report.