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Outsourcing Intelligence

As DNI Negroponte Orders a Review – Good or Bad?

Today, outsourcing surrounds our lives. You call Dell Computer, you get a techie in India, Pakistan or the Philippines. Just when does outsourcing cross the line?

With all of the attention and controversy surrounding our Intelligence Community and about the conflicting analysis that has occurred, you might be surprised to learn that more than half of the employees at the National Counterterrorism Center are outside contractors (estimated at 17,500, double the level of contractors five years ago). Apparently, the CIA actually wants to go beyond that.

So, it is the analysis piece of the puzzle that is being outsourced. And it appears to be evidenced most dramatically in the President’s daily briefing. From the article, U.S. Intelligence Analysis:

To a degree never before witnessed in American history, many core functions of the U.S. intelligence community are being outsourced to the private sector. Outsourcing has taken place in almost every aspect of intelligence work -- collection, counterintelligence, covert operations –- but nowhere has the recent trend been more dramatic than in the analysis that informs what the President receives on his desk every morning. "The outsourced analysis piece, particularly since 9/11, is a significant portion of the analysis that's done," said John Gannon, a former CIA Deputy Director for Intelligence and now head of BAE Systems' Global Analysis Group. "And it's growing."

More on the same subject can be found in the recent L.A. Times article, Spy Agencies Outsourcing to Fill Key Jobs.
Although this situation is good for employees (and the private companies that manage them), some remain uncomfortable with intelligence agencies hiring out sensitive work.

Concerned by the lack of data and direction, Director of National Intelligence John D. Negroponte this year ordered a comprehensive study of the use of contractor, and all sixteen U.S. intelligence agencies have been instructed to turn over records on contractors. "We have to come to some conclusion about what our core intelligence mission is and how many it's going to take to accomplish that mission," said Ronald Sanders, the official charged with reassessing the program. "I wish I could tell you [all this contracting was] by design," he said. "But I think it's been by default."

With intelligence budgets bursting with more than $10 billion a year in extra post-9/11 spending, and with political demands mounting, the government is straining to fill new analyst positions. Contractors command higher salaries than government workers do. Many of the contractors in fact are former IC employees with security clearances who have left military and intelligence community positions to work in the private sector. Many of these former IC professionals simply rotate back into similar jobs, without much of the restrictions and bureaucracy of their former positions.

At CIA headquarters in Langley, Va., senior officials say it is routine for career officers to look around the table during meetings on secret operations and be surrounded by so-called green-badgers — nonagency employees who carry special-colored IDs.

Some of the work being outsourced is extremely sensitive. Abraxas Corp., a private company in McLean, Va., founded by a group of CIA veterans, devises "covers," or false identities, for an elite group of overseas case officers, according to current and former U.S. intelligence officials familiar with the arrangement.

Contractors also are turning up in increasing numbers in clandestine facilities around the world. At the CIA station in Islamabad, Pakistan, as many as three-quarters of those on hand since the Sept. 11 attacks have been contractors. In Baghdad, site of the agency's largest overseas presence, contractors have at times outnumbered full-time CIA employees, according to officials who have held senior positions in the station.

What better source for this capability than former IC people?

The use of outside firms has enabled spy agencies to tap a deep reservoir of talent during a period of unprecedented demand. Many of those hired have been retired case officers and analysts who were eager to contribute to the response to the Sept. 11 attacks and who have more expertise and operational experience than agency insiders. In fact, the CIA has created its own roster of retired case officers — known as the "cadre" — who are eligible to be hired as independent contractors for temporary assignments.

This really isn’t a new occurrence, but what is happening now is that the risks and costs of using contractors to do spy work concerns some IC professionals. At the same time, the profits of the contracting firms are soaring, raising the question of profit motive influencing intelligence tasks.

U.S. intelligence agencies have used contractors for decades. Corporate giants such as Lockheed Martin Corp. have long competed for classified contracts to build spy planes and satellites. Spy services routinely use private companies to handle support functions, such as providing security or building classified computer networks. In fact, two-thirds of the contractors at the counter-terrorism center are information technology workers who manage computer systems. And independent contractors have at times played significant roles in overseas operations, including pilots who flew clandestine supply runs for the CIA in Vietnam.

There has always been “life after” for government workers and military people. Today, it appears clear that cycling back into the “community” in a higher-paying contractor position is more and more the career path of choice. The question that one could ask though, it at what cost?

Meanwhile, new intelligence entities created to fix Sept. 11-related failures — including the intelligence director's office and centers tracking terrorism and weapons proliferation — have created thousands of new positions and cannibalized the ranks of the CIA and other agencies.
In Baghdad, contractors "do everything, especially 'ops' work," a former CIA officer who has served extensively in Iraq said of the operations functions. "They're recruiting [informants], managing the major relationships we have with the military, handling agents in support of frontline combat units. The guys doing that work are contractors. They're not staff officers."