The sound of silence?

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The sound of silence?
America's elite eavesdropping agency faces an uncertain future

By Warren P. Strobel 

At 7 p.m. on January 24, the massive electronic brain of the U.S. 
intelligence system hiccuped, sighed, then shut down. In a twinkling, 
billions of dollars' worth of supercomputers, high-speed modems, and 
top-secret electronics fell silent. The central data network of the National 
Security Agency in leafy Fort Meade, Md., would remain that way for an 
agonizing three daysÐan unprecedented event in the history of the nation's 
intelligence services. 

The computer failure illustrates the perilous state of the NSA, but it also 
shows how America's role in the high-stakes game of intelligence collection 
has changed since the end of the Cold War. During the decades-long face- off 
between Washington and Moscow, human spies grabbed the headlines and captured 
the public's imagination. But it was in the field of signals 
intelligenceÐSIGINT in the argot of the spy tradeÐwhere America had the real 
edge. And that was because of the NSA. Since Harry Truman created it in 1952, 
the supersecret eavesdropping agency (the joke was that the letters stood for 
"no such agency") has scooped up electronic signals from everything from 
faxes and phone calls to radar waves and missile launches. At its closely 
guarded campus in Maryland, teams of linguists and analysts decoded the data 
and determined what they meant. The resulting reports, among the most highly 
classified in the government, were devoured by presidents, generals, and 
cabinet secretar!
!
ies. Around the globe, the NSA plucked countless secrets from the air. It was 
a weapon none could match.

Now, however, the NSA and America's intelligence community face a crisis of 
existential proportions. A number of current and former NSA officials broke 
their customary code of silence to speak to U.S. News about the agency and 
its future. All say America's security will be increasingly at risk if the 
NSA does not manage to pull itself into the futureÐand soon. "We've run out 
of time," one official says. "The world changed on us, and we didn't change 
the talent, the culture, the technology fast enough."

The enemy within. The technology challenges should have come as no surprise. 
Enemies who once communicated over the airwaves now use underground 
fiber-optic cable. Encryption software that creates nearly unbreakable codes 
is available to businessmen and bad guys, depriving the NSA of an edge it 
enjoyed for decades. The sheer volume of the data gathered by the 
agencyÐmillions and millions of feet of tape recordingsÐfar outstrips the 
ability of its analysts to keep up.

But the NSA's biggest enemy may be itself. Larger and more hidebound than the 
CIA (with its $3.6 billion-a-year budget and 38,000 workers worldwide, it is 
the largest employer in Maryland), the NSA has stubbornly resisted change. 
For decades, NSA headquarters was cut off from the outside world. 
Technologically, its elite employees were miles ahead of the rest of the 
world. So much so, it seems, that they discounted the technology revolution 
roaring around them. "There is . . . a total inability to come to grips with 
what's happening to us," an official says. "There is an incredible 
self-centered arrogance about how brilliant we are, how successful we've been 
for the nation. That's all true, but it's blinding us to the future."

That smugness lay behind last month's computer failure. Two years ago, the 
Senate Intelligence Committee ordered its technical advisory group to study 
the NSA. The experts found an agency "in desperate need of organizational 
restructuring and modernization of its information technology 
infrastructure," committee chairman Sen. Richard Shelby said. Sources tell 
U.S. News that private contractors warned the NSA's Q Group that its proposed 
design to begin upgrading its data networks, a project dubbed Light Core, 
would not work. The NSA went ahead with it anyway. Today the system requires 
frequent technological band-aids.

The most damning assessment of the NSA's recent management came from two 
study panels that its new director, Air Force Lt. Gen. Michael Hayden, 
convened before launching what may be a do-or-die effort to shake up the 
agency. "The individual capabilities at NSA far surpass the totality," one 
report concluded. The implication: The agency's mathematicians, linguists, 
analysts, and technologists are being impeded by their own institution.

Listening in. Surprisingly, the NSA's intelligence failures have been 
relatively fewÐso far. But more crises loom because of the proliferation of 
encryption technology. "The crypto revolution is, in some ways, a storm out 
to sea," says former NSA general counsel Stewart Baker. "But one day, it's 
going to roar in and just wipe out large chunks of what the agency does." 

The NSA still performs well in emergencies like Kosovo, officials say. But 
while it can marshal its forces to cover individual targets, officials say 
the NSA is stretched so thin that it no longer provides the sustained 
reporting vital for early warnings to U.S. officials.

Ironically, this should be the golden age of electronic espionage. Global 
com- munications have explod- ed in a dizzying array of mobile phones, 
Internet nodes, and computer networks, providing rich targets for Fort 
Meade's electronics wizards.

But the NSA seems ill-prepared for the new opportunities. The world it once 
knew so well suddenly went C2CÐthat's geekspeak for "computer to computer," a 
networked planet where good guys and bad guys communicate on the same 
electronic grid. The NSA, however, still relies heavily on eavesdropping 
satellites built for the Soviet era. The result? The NSA intelligence "catch" 
becomes less useful each year. 

Staffing is another problem. In recent years, the NSA has lost 7,000 
employees, mostly intelligence analysts and linguists whose skills take years 
to replace. Thanks to a de facto policy against layoffs, the NSA has a work 
force that doesn't have all the skills it needs and has some skills that are 
now obsolete. 

Congress and the White House share blame for neglecting an agency once 
showered with funds. NSA's classified capital budget has been chopped 35 
percent in the past eight years, one source says. While it has received small 
increases the past two years, it will have to risk cutting back on 
intelligence it provides U.S. leaders now.

That's not all. The NSA will have to de-emphasize passive intelligence 
collection from a distance in favor of more-intrusive methods because of 
encryption and other advances, officials inside and outside the agency said. 
That means electronic high jinks of a type usually associated with the CIA: 
swiping computer passwords, spreading software viruses, infiltrating 
listening devices into enemy communications systems. Some see as a model for 
the NSA's future an even more secretive (and unacknowledged) U.S. agency, the 
Special Collection Service. Staffed jointly by CIA and NSA operatives, its 
elite teams of eavesdroppers are dispatched on covert missions worldwide.

Even if the NSA is up to the challenge, it's not clear the country is. The 
House may hold hearings this year on Echelon, a global scanning system 
operated by the NSA and its counterparts in Britain, Canada, Australia, and 
New Zealand. Critics say Echelon is used to steal trade secrets from 
nonparticipants and allows the five countries to monitor one another's 
citizens. (The charge is ironic. Even congressional watchdogs say the NSA 
abides scrupulously by 1970s laws against spying on Americans.) Still, 
obtaining quality signals intelligence in the years ahead will certainly mean 
taking more risks, and the cost of failure could be high for the NSA's 
eavesdroppers. "I'm just not sure the government and the people will back 
them up if they get caught doing it," says Baker, the NSA's former general 
counsel.

In the bubble. Not surprisingly, given the arcane nature of its work, the NSA 
is a peculiar place to work. "You can always tell an NSA extrovert," an 
agency joke goes. "He looks at your shoe tips instead of his." There's a 
darker side to the NSA's insular bureaucratic culture, though. Risk-taking is 
sapped, officials say, by zealous internal investigators who pounce on minor 
infractions (the agency has almost 100 lawyers). Endless hours are spent in a 
byzantine system to achieve perfect fairness in promotions. (The NSA had 485 
promotion boards until Hayden disbanded most of them.)

Reforming the NSA won't be easy, but Hayden is trying. In a six-minute 
address to agency employees on November 15, Hayden announced what he called 
"100 Days of Change." He then moved rapidly, creating his own small 
leadership team to enforce reforms. Layoffs, he warned, were now a 
possibilityÐif that's what is needed to make the agency work. Inside the 
NSA's sleek Ops 2B headquarters building, an elevator traditionally reserved 
for executives is now available for all employees to use.

"DIRgrams." Most strikingly, as director, Hayden has tried to open up the NSA 
and break down the wall of secrecy that has deprived it of both a Washington 
constituency and private-sector innovations. Hayden, who broadcasts his moves 
in regular "DIRgrams" to the NSA work force, went to the investment firm Legg 
Mason Wood Walker Inc. to fill a new top slot, chief financial manager. "The 
agency needs to do some adapting," Hayden said in an interview. The pillars 
it rested on during the Cold War "are now all up for grabs."

Hayden, 54, has received strong reviews from a worried CongressÐand strong 
initial resistance from some of the agency's civilian oligarchs. "Their 
response to '100 Days of Change' has been business as usual," says one 
official. Among the most caustic defenders of the agency's old ways has been 
his civilian deputy, Barbara McNamara. U.S. News was told that members of the 
NSA Advisory Board, an outside panel of military and industry leaders, 
recommended to Hayden that he replace her. He has yet to do so.

With its military director rotating every three years, the NSA is run in 
practice by civilian career employees. A former top official recalled having 
to explain to an incredulous agency director, a three-star officer, why his 
orders weren't being followed. "They're so used to people coming and going, 
there's a tendency to wait for a while," the official said.

In the end, all the new technology may prove to be the least of the NSA's 
problems. "Overcoming technological challenge is what NSA does best," says a 
top intelligence official. Acknowledging it no longer has all the answers may 
be harder. 

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