    [House Hearing, 108 Congress]
    [From the U.S. Government Publishing Office]

        PRIVACY AND CIVIL LIBERTIES IN THE HANDS OF THE GOVERNMENT POST-
    SEPTEMBER 11, 2001: RECOMMENDATIONS OF THE 9/11 COMMISSION AND THE U.S.
        DEPARTMENT OF DEFENSE TECHNOLOGY AND PRIVACY ADVISORY COMMITTEE

    =======================================================================

                                 JOINT HEARING

                                   BEFORE THE

                                SUBCOMMITTEE ON
                       COMMERCIAL AND ADMINISTRATIVE LAW

                                    AND THE

                        SUBCOMMITTEE ON THE CONSTITUTION

                                     OF THE

                           COMMITTEE ON THE JUDICIARY
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED EIGHTH CONGRESS

                                 SECOND SESSION

                                   __________

                                AUGUST 20, 2004

                                   __________

                                 Serial No. 113

                                   __________

             Printed for the use of the Committee on the Judiciary

        Available via the World Wide Web: http://www.house.gov/judiciary

                                         ______

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    95-498                 WASHINGTON : 2005
    _________________________________________________________________
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                           COMMITTEE ON THE JUDICIARY

                F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
    HENRY J. HYDE, Illinois              JOHN CONYERS, Jr., Michigan
    HOWARD COBLE, North Carolina         HOWARD L. BERMAN, California
    LAMAR SMITH, Texas                   RICK BOUCHER, Virginia
    ELTON GALLEGLY, California           JERROLD NADLER, New York
    BOB GOODLATTE, Virginia              ROBERT C. SCOTT, Virginia
    STEVE CHABOT, Ohio                   MELVIN L. WATT, North Carolina
    WILLIAM L. JENKINS, Tennessee        ZOE LOFGREN, California
    CHRIS CANNON, Utah                   SHEILA JACKSON LEE, Texas
    SPENCER BACHUS, Alabama              MAXINE WATERS, California
    JOHN N. HOSTETTLER, Indiana          MARTIN T. MEEHAN, Massachusetts
    MARK GREEN, Wisconsin                WILLIAM D. DELAHUNT, Massachusetts
    RIC KELLER, Florida                  ROBERT WEXLER, Florida
    MELISSA A. HART, Pennsylvania        TAMMY BALDWIN, Wisconsin
    JEFF FLAKE, Arizona                  ANTHONY D. WEINER, New York
    MIKE PENCE, Indiana                  ADAM B. SCHIFF, California
    J. RANDY FORBES, Virginia            LINDA T. SANCHEZ, California
    STEVE KING, Iowa
    JOHN R. CARTER, Texas
    TOM FEENEY, Florida
    MARSHA BLACKBURN, Tennessee

                 Philip G. Kiko, Chief of Staff-General Counsel
                   Perry H. Apelbaum, Minority Chief Counsel
                                     ------

               Subcommittee on Commercial and Administrative Law

                          CHRIS CANNON, Utah Chairman

    HOWARD COBLE, North Carolina         MELVIN L. WATT, North Carolina
    JEFF FLAKE, Arizona                  JERROLD NADLER, New York
    JOHN R. CARTER, Texas                TAMMY BALDWIN, Wisconsin
    MARSHA BLACKBURN, Tennessee          WILLIAM D. DELAHUNT, Massachusetts
    STEVE CHABOT, Ohio                   ANTHONY D. WEINER, New York
    TOM FEENEY, Florida

                      Raymond V. Smietanka, Chief Counsel
                            Susan A. Jensen, Counsel
                            Diane K. Taylor, Counsel
                      James Daley, Full Committee Counsel
              Stephanie Moore, Minority Counsel

                        Subcommittee on the Constitution

                          STEVE CHABOT, Ohio, Chairman
    STEVE KING, Iowa                     JERROLD NADLER, New York
    WILLIAM L. JENKINS, Tennessee        JOHN CONYERS, Jr., Michigan
    SPENCER BACHUS, Alabama              ROBERT C. SCOTT, Virginia
    JOHN N. HOSTETTLER, Indiana          MELVIN L. WATT, North Carolina
    MELISSA A. HART, Pennsylvania        ADAM B. SCHIFF, California
    TOM FEENEY, Florida
    J. RANDY FORBES, Virginia

                         Paul B. Taylor, Chief Counsel
                          E. Stewart Jeffries, Counsel
                              Hilary Funk, Counsel
                      Mindy Barry, Full Committee Counsel
               David Lachmann, Minority Professional Staff Member

                                C O N T E N T S

                                  ----------

                                AUGUST 20, 2004

                               OPENING STATEMENT

                                                                       Page
    The Honorable Chris Cannon, a Representative in Congress From the
      State of Utah, and Chairman, Subcommittee on Commercial and
      Administrative Law.............................................     1
    The Honorable Melvin L. Watt, a Representative in Congress From
      the State of North Carolina, and Ranking Member, Subcommittee
      on Commercial and Administrative Law...........................     3
    The Honorable Steve Chabot, a Representative in Congress From the
      State of Ohio, and Chairman, Subcommittee on the Constitution..     5
    The Honorable Jerrold Nadler, a Representative in Congress From
      the State of New York, and Ranking Member, Subcommittee on the
      Constitution...................................................     6

                                   WITNESSES

    The Honorable Lee H. Hamilton, Vice Chair, National Commission on
      Terrorist Attacks Upon the United States
      Oral Testimony.................................................    11
      Prepared Statement.............................................    14
    The Honorable Slade Gorton, Commission Member, National
      Commission on Terrorist Attacks Upon the United States
      Oral Testimony.................................................    12
      Prepared Statement.............................................    14
    The Honorable John O. Marsh, Jr., on behalf of the U.S.
      Department of Defense Technology and Privacy Advisory Committee
      Oral Testimony.................................................    15
      Prepared Statement.............................................    18
    Ms. Nuala O'Connor Kelly, Chief Privacy Officer, U.S. Department
      of Homeland Security
      Oral Testimony.................................................    49
      Prepared Statement.............................................    51

                                    APPENDIX

    Prepared Statement by the Honorable Chris Cannon, a
      Representative in Congress From the State of Utah and Chairman,
      Subcommittee on Commercial and Administrative Law, Commmittee
      on the Judiciary...............................................    79
    Prepared Statement by the Honorable Steve Chabot, a
      Representative in Congress From the State of Ohio, and
      Chairman, Subcommittee on the Constitution.....................    80
    Prepared Statement by the Honorable Jerrold Nadler, a
      Representative in Congress From the State of New York, and
      Ranking Member, Subcommittee on the Constitution...............    81

        PRIVACY AND CIVIL LIBERTIES IN THE HANDS OF THE GOVERNMENT POST-
    SEPTEMBER 11, 2001: RECOMMENDATIONS OF THE 9/11 COMMISSION AND THE U.S.
        DEPARTMENT OF DEFENSE TECHNOLOGY AND PRIVACY ADVISORY COMMITTEE

                                  ----------

                            FRIDAY, AUGUST 20, 2004

                      House of Representatives,
                             Subcommittee on Commercial
                                and Administrative Law,
                                    Committee on the Judiciary,
                                                        Washington, DC.
        The Subcommittee met, pursuant to call, at 10:06 a.m., in
    Room 2141, Rayburn House Office Building, Hon. Chris Cannon
    [Chairman of the Subcommittee on Commercial and Administrative
    Law] presiding.
        Mr. Cannon. The Subcommittee will come to order. I want to
    thank you all for joining us, especially our panel.
        Today, before we formally start our proceedings, Chairman
    Chabot and I wanted to sincerely thank and recognize our
    colleagues on both Subcommittees and on both sides of the aisle
    for taking time out of their really busy schedules--for me, it
    was difficult, but I know that it was for everyone else--so as
    to attend the hearing this morning.
        As many of you know, August is typically when Members of
    Congress return to their districts to catch up on constituent
    matters and spend time with their families. Wait a minute, do
    you guys have families? It is a time when we call it our home
    district work period. We want to thank everyone for coming out.
        In these extraordinary times, we have to undertake
    extraordinary measures to deal with certain pressing issues. It
    also goes without saying that we express our sincere gratitude
    to our esteemed witnesses, each of whom reflects the greatest
    hallmarks of public service. We appreciate your contributions
    to our deliberations today.
        The title of today's hearing, ``Oversight Hearing on
    Privacy and Civil Liberties in the Hands of the Government
    Post-September 11, 2001: Recommendations of the 9/11 Commission
    and the U.S. Department of Defense Technology and Privacy
    Advisory Committee'', which we will refer to as ``TAPAC'',
    clearly explains why we are here.
        As many of you know, the 9/11 Commission filed its final
    report last month. What some of you may not know, however, is
    that the report includes several recommendations intended to
    protect our citizens' privacy and civil liberties. In addition,
    it recommends that the Federal Government set standards for the
    issuance of birth certificates and sources of identification
    such as driver's licenses to promote secure identification
    information.
        While most media headlines have emphasized the Commission's
    antiterrorism proposals, I believe the privacy and civil
    liberties recommendations are among those most critical to our
    Nation's future and which will form part of the focus of our
    hearing.
        Today's proceedings will also focus on certain
    recommendations the TAPAC Committee made regarding safeguarding
    informational privacy. By way of background, TAPAC was
    established by Secretary Rumsfeld as an independent, bipartisan
    committee to examine the privacy ramifications presented by
    data mining activities by the Defense Department. I think we
    all agree that Secretary Rumsfeld is to be commended for taking
    this initiative and for ensuring that TAPAC's membership
    included some of our Nation's most respected experts in the
    fields of constitutional and privacy law. I am informed that
    among the many luminaries who testified before TAPAC was our
    colleague from New York, Mr. Nadler. Thank you.
        Advances in technology have increasingly facilitated the
    collection and dissemination of personally identifiable
    information, but have also correspondingly increased the
    potential for misuse of such information. As the recently
    renamed Government Accountability Office observed, these
    advances bring substantial Federal information benefits, as
    well as increasing responsibilities and concerns.
        Interestingly, TAPAC over the course of its deliberations
    determined that as the Defense Department was not alone in its
    conduct of data mining activities, it was necessary for it to
    address this issue through a series of Government-wide
    recommendations. The purpose of today's hearing is to examine
    the validity of these recommendations and those of the 9/11
    Commission that relate to privacy and civil liberties and to
    determine whether they warrant a legislative response.
        We would especially appreciate any guidance from our
    witnesses about how the Congress, in crafting such legislation,
    can best protect our citizens' privacy without compromising
    legitimate law enforcement and terrorism detection efforts.
        As our witnesses know, it has been 30 years since the
    Privacy Commission was established as part of the Privacy Act
    of 1974. I would be interested in having our witnesses comment
    on whether now is the time to reestablish a privacy commission
    that would specifically focus on Government privacy issues,
    especially given all the technological developments that have
    occurred since the Commission filed its final report in 1977
    and the current state of our Nation's security concerns.
        I should also note that both my Subcommittee, the
    Subcommittee on Commercial and Administrative Law, and Chairman
    Chabot's Subcommittee, the Constitution Subcommittee, have
    played a major role with respect to protecting personal privacy
    and civil liberties in this era of heightened security under
    the leadership and guidance of Mr. Sensenbrenner, the Chairman
    of the full Judiciary Committee.
        As both the 9/11 Commission Report and the TAPAC concluded,
    it is no easy task to balance the competing goals of keeping
    our Nation secure and protecting the privacy rights of our
    Nation's citizens. I believe that our respective Subcommittees
    of the Judiciary Committee are uniquely and best suited to
    study and resolve these issues.
        Our accomplishments, to date, include the establishment of
    the first statutorily-created privacy office in a Federal
    agency, namely the Department of Homeland Security. We have
    also spearheaded the creation of a similar office in the
    Justice Department, which is contained in the legislation now
    pending in the Senate. In addition, both my Subcommittee and
    the Constitution Subcommittee have considered and supported
    legislation requiring a Federal agency to prepare a privacy
    impact analysis for proposed and final rules, and to include
    this analysis in the notice of public comment issued in
    conjunction with the publication of such rules.
        I will conclude my opening remarks with a quote from one of
    our Founding Fathers. As I think you will agree, Mr. Hamilton's
    observations and warnings--and here we are dealing with the
    earlier Mr. Hamilton--are as meaningful today as they were when
    he wrote them more than 200 years ago. ``Safety from external
    danger is the most powerful director of national conduct. Even
    the ardent love of liberty will, after a time, give way to its
    dictates. The violent destruction of life and property incident
    to war, the continual effort and alarm attendant on a state of
    continual danger, will compel nations the most attached to
    liberty to resort for repose and security to institutions which
    have a tendency to destroy their civil and political rights. To
    be more safe, they at length become willing to run the risk of
    being less free.''
        I will now turn to my colleague, Mr. Watt, the
    distinguished Ranking Member of my Subcommittee and ask him if
    he has any opening remarks.
        [The prepared statement of Mr. Cannon follows in the
    Appendix]
        Mr. Watt. Thank you, Mr. Chairman. I thank the Chairman of
    this Committee and the Chairman of the Constitution
    Subcommittee for deciding to have a hearing on the issues
    involved today and to do it jointly so that we do not end up
    duplicating efforts and pulling in different directions
    possibly.
        I would like to start really by expressing thanks to the
    witnesses for being here today. And by expressing a special
    thanks to Lee Hamilton and Slade Gordon, the members of the
    Commission, for the outstanding job that they did under some
    very, very, very difficult circumstances; and getting through
    the process without any appearance of partisanship, and being
    single-focused on the issue at hand, which was protecting
    American citizens and others from terrorism.
        Who knows where the recommendations of the Commission will
    go? And it is hard to even contemplate where they may go
    legislatively or administratively. But the thing that I think
    is most important is that before they go anywhere, we
    understand exactly what the recommendations are and have a
    better understanding of all of the implications of the
    recommendations.
        I sense that several Committees have headed off in the
    direction of dealing only with the security side of the balance
    that must be struck. And I think it is our obligation in this
    Committee not only to look at the security side, but to be ever
    cognizant of the privacy implications and the personal liberty
    implications of what is being done. And the only way we can do
    that is to really have hearings about what is being proposed
    and what we should be implementing.
        I am extremely encouraged that the Commission recognize
    this delicate balance itself in its recommendations, making
    three specific recommendations pertaining to the protection of
    civil liberties. First, the report calls for the President to
    ``safeguard the privacy of individuals about whom information
    is shared among intelligence and investigation agencies.''
        Second, the report requires that in order to retain a
    particular governmental power, the executive first demonstrate
    that the ``power actually materially enhances security,'' and
    that adequate oversight exist ``to ensure protection of civil
    liberties.'' so it is very apparent that the Commission is
    already wrestling with what the appropriate balance should be
    between safeguarding our citizens by protecting them from
    terrorism and, on the other hand, safeguarding our citizens by
    protecting them against overstepping by governmental agencies
    who say that they have our interests at heart.
        So that is a very delicate balance which I think this
    hearing can only enlighten the American public on and enlighten
    the Members of this Committee on as we move forward, and
    enlighten our colleagues in the broader House and Senate as we
    move forward.
        Finally, the report recommends the creation of a board
    within the executive branch to oversee adherence to the
    guidelines, and it recommends the commitment the Government
    makes to defend civil liberties. So that board is again
    supposed to walk that delicate balance between adhering to the
    guidelines and recommending a commitment to defend civil
    liberties. And I think that is absolutely critical as we move
    forward.
        So I am delighted that the Chairman has convened this
    hearing for the purpose of discussing, and I hope nobody takes
    this as any indication that we in this Committee are not as
    committed to the defense of our citizens from terrorism, rather
    that they take it as an equal commitment that we understand the
    historical imperative, the constitutional imperative of also
    safeguarding the security and individual rights and privacy of
    citizens as we authorize the Government to take the actions
    that are necessary to safeguard us against terrorism.
        That is going to be a very, very delicate balance to walk.
    And if we are going to do it, this is the place to start, right
    here in the Committee on the Judiciary, in the Constitution
    Subcommittee, in the Commerce and Administrative Law
    Subcommittee where it is our responsibility to look at these
    issues and make some very difficult choices.
        I thank the Chairman and the members of the Commission and
    our other witnesses for being here to enlighten us on where
    that delicate balance should be.
        Thank you, Mr. Chairman.
        Mr. Cannon. Thank you, Mr. Watt.
        Mr. Cannon. Mr. Watt and I have, on occasion, disagreed
    very sharply, and by ``sharply,'' meaning he has a very sharp
    mind and it is hard to disagree with him.
        On the other hand, there are many issues where we do not
    disagree at all and this is one of those areas where we have
    difficult issues and we may differ on some points, but we will
    come up with, I hope, some thoughtful resolutions. So I want to
    thank the minority Ranking Member.
        I would also like to thank Mr. Chabot for being here today
    and his Ranking Member, Mr. Nadler.
        Mr. Chabot, would you like to make a statement?
        Mr. Chabot. Thank you, Mr. Chairman. I first of all want to
    thank you for holding this hearing, as well as Mr. Watt, Mr.
    Nadler, the Ranking Member on the Subcommittee that I have the
    good fortune to chair; and I want to thank all of my Committee
    Members who are in attendance today. And I want to offer a
    special welcome to all of the witnesses, but especially the
    Honorable Congressman Hamilton whose district in Indiana
    abutted mine in the southwest corner of Ohio, in the time that
    I have been in Congress, for a number of years.
        Lee was also the Chairman of the Committee on International
    Relations and served for many years with distinction. When my
    party took over in 1994, he was the Ranking Member for the time
    that I served here, but nonetheless he served with great
    distinction. He was really a role model for many of us,
    especially in the area of international affairs. So I want to
    thank him for his leadership in that respect.
        Also, Senator Gorton, who served the people of Washington
    for so many years so well. I want to thank all of the witnesses
    for being here today.
        I want to thank especially Senator Gorton and Senator
    Hamilton for the last 20 months that they have served on the 9/
    11 Commission. Our Nation owes you a great debt of gratitude
    for your work, and I am confident that we will all benefit from
    your expertise here this morning and in the future as we
    implement all or most of the recommendations that you have
    made.
        As we know far too well, September 11 changed our world. It
    changed the way in which we must deal with terrorism and the
    way in which we as a country must protect ourselves. Since that
    tragic day, Congress and the Administration have taken steps to
    help better protect our Nation at home and abroad. Through
    passage of the PATRIOT Act and the creation of the Department
    of Homeland Security, we have provided law enforcement with
    enhanced investigative tools and improved our ability to
    coordinate abilities designed to protect against the future
    threat of terrorism. And make no mistake, that threat continues
    to face our Nation.
        Through the heroic actions of the brave men and women
    serving in our Armed Forces, we have also pursued the
    terrorists and those who assist them in places like Afghanistan
    and Iraq. Yet these actions are not enough to guarantee our
    Nation's security or freedom. This can only be accomplished
    through continued vigilance and willingness to challenge
    conventional wisdom. We must continue to improve our
    intelligence capability, strengthen our defenses and always be
    a step ahead of our enemies.
        To help accomplish these critical goals, it is imperative
    that Congress provide a comprehensive and expeditious review of
    the 9/11 Commission recommendations and then move forward with
    initiatives that will further improve our ability to combat
    terrorism and defend our citizens.
        As the Commission notes, we must also be mindful of the
    protections afforded by our Constitution and our need to guard
    those protections as we work to better protect our country.
    Ignoring important civil liberties will not only erode our
    freedoms, but will undermine efforts to increase our security.
    These challenges are not new, and our two Subcommittees have
    been extensively involved in these issues over the last couple
    of years.
        In the PATRIOT Act, for example, we worked to include
    protective measures such as a sunset provision to strengthen
    congressional oversight. When authorizing the Department of
    Homeland Security, a privacy officer position was established
    to examine the implications of the agency's rules and
    regulations on privacy and to address any issues that may
    result.
        I look forward, as I know the other Members do, to
    discussing the Commission's recommendations with our witnesses
    today in determining what Congress can do to better protect the
    privacy of our citizens. I particularly look forward to hearing
    from our panel their views on the Federal Agency Privacy
    Protection Act of 2004, which passed the House during the 107th
    Congress and was recently voted out of the full Judiciary
    Committee. It was back on, I believe, July 7.
        I believe that this, which was formerly known as the
    Defense of Privacy Act, would require Federal agencies to
    publish privacy impact analyses when promulgating rules and
    regulations. I believe it would be an effective step forward in
    our efforts to protect our country and our privacy rights.
        As we move forward, it is important to remember that having
    effective antiterrorism measures does not necessarily
    compromise the protections afforded by our Constitution, as one
    is not the enemy of the other. The enemy is terrorism.
        I yield back my time and thank the Chairman once again for
    holding this hearing.
        Mr. Cannon. Thank you, Mr. Chairman. I thank you for that
    opening statement.
        [The prepared statement of Mr. Chabot follows in the
    Appendix]
        Mr. Cannon. Mr. Nadler, would you like to make an opening
    statement?
        Mr. Nadler. Thank you, Mr. Chairman. Mr. Chairman, given
    the importance of this matter and the fact that nearly 3 years
    have elapsed since the attacks of September 11, I am pleased
    that we have returned to consider the recommendations of the 9/
    11 Commission now without waiting, as some have suggested,
    until next year.
        I want to welcome our former colleagues Representative
    Hamilton and Senator Gorton and to thank them for the important
    work they and their colleagues have done.
        I am also pleased that we have Secretary Marsh here today.
    The issues that gave rise to the Secretary's Technology and
    Privacy Advisory Committee are also implicated in the
    Committee's recommendation, so it is important that we have the
    benefit of our work.
        Finally, I want to welcome back Ms. O'Connor Kelly. The 9/
    11 Commission has recommended in somewhat general terms that we
    set up a civil liberties oversight board. The TAPAC commission
    has similarly recommended that the Secretary of Defense create
    a policy level privacy officer. Congress will have to work out
    the details.
        I hope that your experience as the privacy officer of the
    Department of Homeland Security can shed some light on how we
    might ensure the independence and effectiveness of the offices
    created pursuant to these recommendations.
        The need to improve capabilities and coordination within
    the intelligence and law enforcement communities was all too
    well demonstrated on September 11. Thousands of innocent
    citizens who did nothing more than board an aircraft or go to
    work were barbarically slaughtered. We ignored our Nation's
    peril, the lesson we can draw from the intelligence failures
    leading up to those crimes and from other recent intelligence
    fiascoes.
        At the same time, increased Government powers carry with
    them increased threats to the rights of all citizens. We expect
    our Government to keep it safe, but we are also a nation with a
    healthy mistrust of unfettered governmental power.
        Our whole system of Government combines limited powers with
    checks and balances that must maintained. Rights sacrificed at
    a time of emergency are often lost forever. Actions taken in
    the heat of the moment are often a source of shame and regret
    to later generations. So our job is to strike an appropriate
    and workable balance.
        That is not easy. As the members of the Commission have
    noted in their report, ``While protecting our homeland,
    Americans should be mindful of threats to vital personal and
    civil liberties. This balancing is no easy task, but we must
    constantly strive to keep it right. This shift of power and
    authority to the Government calls for an enhanced systems of
    checks and balances to protect the precious liberties that are
    vital to our way of life.''
        A little further on the Commission notes, it talks in
    general terms about the provision of the PATRIOT Act and some
    of the beneficial provisions of the PATRIOT Act, and then it
    says, ``Because of concerns regarding the shifting balance of
    power to the Government, we think that a full and informed
    debate on the PATRIOT Act would be healthy.'' The Commission
    then makes three general recommendations for specific measures
    to balance civil liberties and national security.
        Mr. Justice Marshall in a noted decision of the Supreme
    Court 200 years ago in Marbury v. Madison, a decision that has
    been somewhat criticized by one Member of this Committee,
    noted, and I am paraphrasing here because I do not have the
    exact quote before me, ``It is emphatically the province of the
    judiciary to say what the law is.''
        And that is true. It is emphatically the province of the
    Judiciary Committee to begin the process of having Congress
    strike the proper balance between national security, homeland
    security, and protection of our civil liberties. That is our
    job.
        I appreciate the beginning guidance that the Commission has
    given us and recommended that we strike that balance, but we
    have to determine how to strike that balance. And I am glad and
    I appreciate the Chairman calling this hearing as a beginning
    of that process so we can carefully consider all of the things
    we have to consider to strike that balance, and with all
    deliberate speed, enact legislation to do that.
        So I am glad we are having this hearing and I thank you.
        Thank you, Mr. Chairman.
        Mr. Cannon. I thank the gentleman.
        [The prepared statement of Mr. Nadler follows in the
    Appendix]
        Mr. Cannon. I would like to just point out to my co-Chair
    of this hearing, Mr. Chabot, Ranking Member Watt, and Ranking
    Member Nadler, we have worked together on issues not unlike
    this for some period of time, including the PATRIOT Act and
    other issues. And there is a genuine, I believe, feeling for
    doing the right thing here, and I hope that that will result in
    legislation in an area that is very, very difficult and improve
    that legislation.
        Without objection, the gentlemen's entire statements will
    be placed in the record. Also, without objection, all Members
    may place their statements in the record at this point. Any
    objection?
        Hearing none, so ordered.
        Without objection, the Chair will be authorized to declare
    recesses of the hearing at any point. Hearing none, so ordered.
        I ask unanimous consent that Members have 5 legislative
    days to submit written statements for inclusion in today's
    hearing record. Without objection, so ordered.
        Mr. Cannon. Now I am pleased to introduce our witnesses for
    today's hearing. Our first witness is Lee Hamilton, who is Vice
    Chair of the 9/11 Commission. Former Congressman Hamilton
    currently is President and Director of the Woodrow Wilson
    International Center For Scholars. Before undertaking these
    responsibilities at the Center in 1999, Congressman Hamilton
    served for 34 years in the House, representing Indiana's Ninth
    District. During his tenure, he served as Chairman and Ranking
    Member of the forerunner of the House Committee on
    International Relations and served on the Permanent Select
    Committee on Intelligence and the Select Committee To
    Investigate Covert Arms Transactions with Iran.
        After his tenure in Congress, he served on the Commission
    on National Security in the 21st Century, also known as the
    Hart-Rudman Commission, and was co-Chair with former Senator
    Howard Baker of the Baker-Hamilton Commission to investigate
    certain security issues at Los Alamos. He is currently a member
    of the President's Homeland Security Advisory Council.
        Mr. Hamilton is a graduate of DePauw University and Indiana
    University Law School, as well as the recipient of numerous
    honorary degrees and national awards for public service. And I
    hope I have said privately to Mr. Hamilton what I would like to
    say now and that is that when I came to Congress I looked
    around at the various Members of Congress to decide who I
    wanted to model, he was very clearly one of the people who I
    think did a remarkably good job in a complex institution; and
    he has been an explicit model in my life in my office.
        I welcome you back, Mr. Hamilton.
        Our second witness is former Senator Slade Gorton who also
    appears on behalf of the 9/11 Commission. Senator Gorton is
    currently of counsel at Preston, Gates & Ellis. Prior to
    joining the firm, he represented Washington State in the United
    States Senate for 18 years, from 1982 to 2000. While in the
    Senate, Mr. Gorton served on the Appropriations, Budget,
    Commerce, Science and Transportation, and Energy and Natural
    Resources Committees. He also chaired the Interior
    Appropriations Subcommittee, and was a member of the Republican
    Leadership as Counsel to the Majority Leader.
        Senator Gorton began his political career in 1958 as a
    Washington State representative and then went on to serve as
    the State house majority leader. In 1968, he was elected
    Attorney General for the State of Washington where he argued 14
    cases before the United States Supreme Court. Mr. Gorton also
    served on the President's Consumer Advisory Council, as well as
    on many other Federal and State commissions. Most recently,
    Senator Gorton served on the National Commission on Federal
    Election Reform.
        Senator Gorton received his undergraduate degree from
    Dartmouth College and his law degree from Columbia University.
        We welcome you back and appreciate your service in the
    Senate where we had some very pleasant interactions over a
    period of time.
        Our third witness is John Marsh, who appears today on
    behalf of TAPAC. Secretary Marsh, like his fellow witnesses,
    has served our Nation in a number of distinguished ways, I
    might just say a very different and a remarkable history of
    service, most prominently as Secretary of the Army and as the
    representative of Virginia's Seventh Congressional District.
    After an exemplary period of service with the U.S. Army,
    Secretary Marsh received his law degree in 1951 from Washington
    and Lee University and began his practice of law in Strasburg,
    VA. Thereafter, he was elected to four terms of Congress from
    the Seventh District of Virginia and served on the House
    Appropriations Committee.
        After choosing not to seek a fifth term, Secretary Marsh
    resumed the practice of law. In 1973, however, he returned to
    Federal service as Assistant Secretary of Defense for
    Legislative Affairs. The following year, he became the
    Assistant for National Security Affairs to Vice President Ford,
    and in August 1974 became Counselor, with Cabinet rank, to
    President Ford. He chaired the Presidential Committee for the
    Reorganization of the U.S. Intelligence Community from 1975 to
    1976.
        Later sworn in as Secretary of the Army in 1981, Secretary
    Marsh served until 1989 achieving a tenure that was the longest
    of any Secretary of the Army or Secretary of War in American
    history. During 1988, he served concurrently as Assistant
    Secretary of Defense for Special Operations and Low Intensity
    Conflict.
        Secretary Marsh has been awarded numerous honors and
    decorations. He is currently a Distinguished Professor of Law
    at George Mason University concentrating on cyberterrorism and
    national security law. He is also a member of the Special
    Congressional Panel on Terrorism to assess Federal, State and
    local response to weapons of mass destruction, known as the
    Gilmore Commission.
        Our final witness is Nuala O'Connor Kelly, the Chief
    Privacy Officer at the Department of Homeland Security. We
    welcome you back.
        As many of you know, Ms. O'Connor Kelly testified earlier
    this year as part of my Subcommittee's continuing oversight of
    her office. Ms. O'Connor Kelly is especially commended for
    participating in today's hearing as she is currently on
    maternity leave and having difficulty getting enough sleep. So
    we will send someone out for a coffee or a Coke if you need
    that at some point.
        As I previously noted in my remarks, my Subcommittee with
    the support of our Chairman, Mr. Sensenbrenner, played a major
    role in establishing Ms. O'Connor Kelly's office at the
    Department of Homeland Security. The legislation creating her
    office not only mandated the appointment of a privacy officer,
    but specified the officer's responsibilities.
        One of the principal responsibilities of the DHS privacy
    officer, as set out by statute, is the duty to assure that the
    use of technologies sustain and do not erode privacy
    protections relating to the use, collection and disclosure of
    personal information. In addition, the privacy officer must
    assure that personal information is handled in full compliance
    with the Privacy Act and assess privacy impacts with the
    Department's proposed rules.
        Pursuant to this legislation, DHS Secretary Tom Ridge last
    year appointed Ms. O'Connor Kelly to serve as the Department's
    Chief Privacy Officer. Since her appointment, Ms. O'Connor
    Kelly has played a key role in various terrorist detection
    initiatives undertaken by DHS. Prior to her current
    appointment, she served as the Chief Privacy Officer at the
    Commerce Department.
        Before entering public service, Ms. O'Connor Kelly was the
    Vice President for Data Protection and the Chief Privacy
    Officer for DoubleClick, an online media services company that
    made great headlines just prior to her taking that position.
        In that capacity, Ms. O'Connor Kelly established the
    company's first data protection department responsible for
    instituting privacy protection policies and procedures for
    DoubleClick, its clients and partners.
        Ms. O'Connor Kelly received her undergraduate degree from
    Princeton University, a Master's degree in Education from
    Harvard University and a law degree from Georgetown University
    Law Center.
        I extend my warm regards and appreciate your willingness to
    participate in today's hearing. In light of the fact that your
    written statements will be included in the hearing record, I
    request that you limit your oral remarks to 5 minutes.
    Accordingly, please feel free to summarize or highlight the
    salient points of your testimony.
        You will note that we have a lighting system. I think you
    are all familiar with it. It starts at green; when 4 minutes
    have passed, it turns yellow, and then it turns red at 1
    minute. We do not want to cut off your thinking. In fact, I
    would like to say this is undoubtedly the most prestigious
    panel I will ever--we have had two justices from the Supreme
    Court recently testifying on the Administrative Conference of
    the United States, Justices Scalia and Breyer. But there are
    only two of them and their history is fairly narrow compared
    with the experience we have with you.
        So if you would just recognize the 5-minute light, we would
    appreciate it if you would draw to a close. We will have people
    that will have the opportunity to ask questions and expand on
    issues.
        Everyone was here at the beginning of the hearing, so we
    will go by seniority. With Mr. Watts' help, I will try to tap
    the gavel at 5 minutes so all Members have an opportunity to
    ask questions. If there is an interest, we may go to a second
    round of questions.
        Pursuant to the directive of the Chairman of the Committee
    on the Judiciary, I am going to ask the panel to stand and
    raise your right hand and take an oath.
        [Witnesses sworn.]
        Mr. Cannon. Congressman Hamilton, would you proceed with
    your testimony?

        TESTIMONY OF THE HONORABLE LEE H. HAMILTON, VICE CHAIR,
    NATIONAL COMMISSION ON TERRORIST ATTACKS UPON THE UNITED STATES

        Mr. Hamilton. Thank you very much Chairman Cannon, Ranking
    Member Watt, Chairman Chabot, Ranking Member Nadler and the
    other distinguished Members of the two Subcommittees. We are
    very honored to appear before you today.
        I want to say that the chairman of the 9/11 Commission, Tom
    Kean, was not able to be here today. He led the Commission with
    extraordinary skill and deserves much of the credit for the
    Commission's success.
        I am very pleased to be here with Senator Gorton. He made
    extraordinary contributions as a Commission member. We turned
    to him again and again for advice, and it is a pleasure to be
    with him.
        We especially appreciate the fact that all the Members are
    here during August. I know that it is unprecedented, and we are
    very grateful to you for your interest in our work.
        I want to say that the statements made by the Chairman and
    Ranking Members of the two Subcommittees were extraordinarily
    good statements. I thank you for those. I also thank you for
    the personal sentiments that you expressed.
        Your Subcommittees, as well as your parent Committee, have
    a very long record of concern and leadership in these issues,
    so it is a very special pleasure for us to be with you. We
    simply point out that our Commission's recommendations were
    unanimous. I think you know that.
        I think from the very beginning of the Commission's work,
    about 18 or more months ago, all of us have been very conscious
    of the need to make sure that in our zeal to fight terrorism,
    we do not compromise the very rights and liberties that make
    our system of Government and society worth defending.
        Concern about the civil liberties of American citizens was
    one of the number of reasons why the Commission rejected the
    idea of moving the domestic intelligence and counterterrorism
    responsibilities of the FBI out of that agency and placing them
    in an MI-5 type agency. We feared that such a new agency, not
    steeped in respect for law and the Constitution that pervades
    the FBI and the Justice Department, and reporting to the
    National Intelligence Director, the Director of Central
    Intelligence rather than the Attorney General, would be more
    likely to trample on individual rights.
        The Commission made three major recommendations with
    respect to civil rights. The first dealt with the critical and
    complicated privacy issues that are at the heart of our new
    information society and at the heart of the necessary efforts
    to increase the amount of information gathered by our
    intelligence agencies and shared by them among themselves and
    with State and local law enforcement officials.
        We recommend improvements and enhancements in those
    information gathering abilities and in information sharing. But
    we also recognize that with the enhanced flow of information
    comes a need to establish guidelines and oversight to make sure
    that the privacy of our citizens and residents is respected and
    preserved.
        We did not conduct extensive investigation of our own on
    data mining and other privacy issues raised by information
    gathering and sharing. We relied very much on the Markle Task
    Force. I'm sure that work is familiar to you. We believe, along
    with the Markle Task Force, that we have the ability to gather
    and share information and protect privacy at the same time.
    This requires, however, leadership and coordination in the
    executive branch.
        No one agency can deal with this problem alone. We
    recommend that the President lead a Government-wide effort
    through OMB and the National Intelligence Director to set
    common standards for information use throughout the
    Intelligence Community. These standards would govern the
    acquisition, accessing, sharing and using of private data so as
    to protect individual rights.
        The same technology that facilitates the gathering and
    sharing of information can also protect us from the misuse of
    that information. And for the balance of the statement, I turn
    to Senator Gorton.

      TESTIMONY OF THE HONORABLE SLADE GORTON, COMMISSION MEMBER,
    NATIONAL COMMISSION ON TERRORIST ATTACKS UPON THE UNITED STATES

        Mr. Gorton. Our second major recommendation in this area
    relates to the USA PATRIOT Act, many of the provisions of which
    expire at the end of next year and will be the subject of
    hearings by the House and Senate Judiciary Committees. The only
    specific provisions of that act on which we expressed a view
    are those relating to information sharing.
        The elimination of the wall that had severely constrained
    the flow of information acquired through surveillance under the
    Foreign Intelligence Surveillance Act from the intelligence
    side of the FBI and to the criminal side of the Agency and to
    Federal prosecutors, and the broadening of the ability of the
    Justice Department to share grand jury information with other
    intelligence and law enforcement agencies.
        We endorse the extension of those provisions which,
    witnesses were virtually unanimous in telling us, were
    extremely helpful to law enforcement and intelligence
    investigations with little, if any, adverse impact on the
    rights of potential defendants. But we did propose a general
    test to be applied to consideration of the renewal of the other
    provisions of the USA PATRIOT Act, and we believe that that
    principle should also be applied to other legislative and
    regulatory proposals designed to strengthen our security, but
    that may impinge on individual rights.
        The test is a simple but important one. The burden of proof
    should be on the proponents of the measure to establish that
    the power or authority being sought would, in fact, materially
    enhance national security, and that there will be adequate
    supervision of the exercise of that power or authority to
    ensure protection of civil liberties. If the power is granted,
    there must be adequate guidelines and oversight properly to
    confine its use.
        We think that the same spirit that informed our
    recommendation as to the burden of proof that should be applied
    to measures of this kind is also reflected in H.R. 338,
    recently reported out of this Subcommittee and the full
    Judiciary Committee. H.R. 338 requires Federal agencies that
    are proposing rules that will require the collection of
    personal information from individuals to conduct privacy impact
    assessments as part of their rule-making process to ensure that
    privacy interests of individuals receive attention and
    protection.
        The Commission, of course, takes no position on that bill.
    But we can observe that it proceeds from the same concerns that
    animate our recommendations.
        Our third recommendation flows from the first two.
    Individual rights and liberties must be adequately protected in
    the administration of the significant powers that Congress has
    granted to executive branch agencies to protect national
    security. There should be a central office or board that has
    the responsibility to oversee adherence guidelines that are
    built into these programs to safeguard these rights and
    liberties.
        We make no recommendation as to how this office or board
    should be composed or where in the executive branch it should
    be located. Some commissioners believe that it should be a
    permanent office located in the Justice Department and
    reporting to the Attorney General, but with oversight of the
    programs of the Department of Homeland Security and other
    agencies, as well as those of the Justice Department. Others
    envisage a Cabinet-level interagency board or committee
    reporting to the President. But we are all agreed that some
    entity of this kind should be created.
        And departing for just a moment from my written statement,
    both the Chairman and Mr. Watt referred to the importance of
    this vehicle. Yesterday, Mr. Lee Hamilton and I testified
    before the Senate Judiciary Committee. Thereafter, I made a
    contact I'd made previously with Senators McCain and Lieberman
    who are working on a bill to provide exactly this board.
        I went and spoke at length with the staff director of the
    Senate Commerce Committee, formerly a member of my staff, on
    such a draft. And it may well be that you would like to contact
    them, see the direction in which they are going and work
    together. It looked to me like a very constructive first draft.
        We close with an observation from our report. We must find
    ways of reconciling security with liberty since the success of
    one protects the other. The choice between security and liberty
    is a false choice as nothing is more likely to endanger
    America's liberties than the success of a terrorist attack at
    home. Our history has shown us that insecurity threatens
    liberty. Yet, if our liberties are concerned, we lose the
    values that we are struggling to defend.
        We will be pleased to respond to your questions.
        Mr. Cannon. Thank you, Mr. Hamilton and Mr. Gorton.
        [The prepared statement of Messrs. Hamilton and Gorton
    follows:]
              Prepared Statement of Lee Hamilton and Slade Gorton
        Chairman Cannon, Ranking Member Watt, and other distinguished
    members of the Subcommittee: We are honored by the opportunity to
    appear before you today. We appreciate the opportunity to discuss with
    you the findings and recommendations of the Commission with respect to
    privacy and civil liberties. These Subcommittees, as well as your
    parent Committee, have a long record of concern with these issues, so
    it is a special pleasure to discuss with you the important question of
    how the measures we must take to protect our nation against the threat
    of terrorist attacks can be reconciled with the individual rights and
    liberties we hold so dear.
        We want to emphasize that the Commission's views on these issues--
    as well as all others dealt with in our Report--were unanimous. We are
    five Republicans and five Democrats, but we are united in our
    commitment to make our country safer and more secure in the face of the
    novel threat posed by transnational terrorism. And we can report to you
    that from the very beginning of the Commission's work some eighteen
    months ago, all of us have been conscious of the need to make sure that
    in our zeal to fight the scourge of terrorism we do not compromise the
    very rights and liberties that make our system of government and our
    society worth defending.
        Concern about the civil liberties of American citizens was one of a
    number of reasons why the Commission rejected the idea of moving the
    domestic intelligence and counterterrorism responsibilities of the FBI
    out of that agency and placing them in a new MI-5-type agency. We
    feared that such a new agency, not steeped in the respect for the law
    and the Constitution that pervades the FBI and the Justice Department,
    and reporting to the National Intelligence Director or the Director of
    Central Intelligence rather than to the Attorney General, would be more
    likely to trample on individual rights.
        The Commission made three major recommendations with respect to
    civil liberties. The first dealt with the critical and complicated
    privacy issues that are at the heart of our new ``information society''
    and at the heart of the necessary efforts to increase the amount of
    information gathered by our intelligence agencies and shared by them
    among themselves and with state and local law enforcement officials.
    The Commission recommends improvements and enhancements in those
    information-gathering abilities and in information sharing. But we also
    recognize that with the enhanced flow of information comes a need to
    establish guidelines and oversight to make sure that the privacy of our
    citizens and residents is respected and preserved.
        We did not conduct extensive investigation of our own on data-
    mining and other privacy issues raised by information gathering and
    sharing. Instead, we relied on the excellent work done by the Markle
    Foundation Task Force, reflected in two reports, in 2002 and 2003. The
    insights of the Markle Task Force have been reinforced by the more
    recent investigation and report by the Technology and Privacy Advisory
    Committee established by Secretary Rumsfeld to advise him on the
    privacy implications of the Department's Terrorism Information
    Awareness Program--a report that this Subcommittee is also focusing on
    today.
        We believe, along with the Markle Task Force, that we have the
    ability to gather and share information and protect privacy at the same
    time. But this requires leadership and co-ordination in the executive
    branch. No one agency can deal with this problem alone. Instead, we
    recommend that the President lead a government-wide effort, through OMB
    and the National Intelligence Director, to set common standards for
    information use throughout the intelligence community. These standards
    would govern the acquisition, accessing, sharing and using of private
    data so as to protect individual rights. The same technology that
    facilitates the gathering and sharing of information can also protect
    us from the misuse of that information.
        Our second major recommendation in this area relates to the USA
    PATRIOT Act, many of the provisions of which expire at the end of next
    year and will be the subject of hearings by the House and Senate
    Judiciary Committees. The only specific provisions of that Act on which
    we expressed a view are those relating to information-sharing: the
    elimination of the ``wall'' that had severely constrained the flow of
    information acquired through surveillance under the Foreign
    Intelligence Surveillance Act from the intelligence side of the FBI to
    the criminal side of the agency and to federal prosecutors, and the
    broadening of the ability of the Justice Department to share grand jury
    information with other intelligence and law enforcement agencies. We
    endorsed the extension of those provisions, which witnesses were
    virtually unanimous in telling us were extremely helpful to law
    enforcement and intelligence investigations with little if any adverse
    impact on the rights of potential defendants.
        But we did propose a general test to be applied to consideration of
    the renewal of other provisions of the USA PATRIOT Act, and we believe
    that that principle should also be applied to other legislative and
    regulatory proposals that are designed to strengthen our security but
    that may impinge on individual rights. The test is a simple but
    important one: The burden of proof should be on the proponents of the
    measure to establish that the power or authority being sought would in
    fact materially enhance national security, and that there will be
    adequate supervision of the exercise of that power or authority top
    ensure protection of civil liberties. If the power is granted, there
    must be adequate guidelines and oversight to properly confine its use.
        We think the same spirit that informed our recommendation as to the
    burden of proof that should be applied to measures of this kind is also
    reflected in H.R. 338, recently reported out of this Subcommittee and
    the full Judiciary Committee. H.R. 338 requires federal agencies that
    are proposing rules that will require the collection of personal
    information from individuals to conduct privacy impact assessments as
    part of their rulemaking process to ensure that privacy interests of
    individuals receive attention and protection. The Commission, of
    course, takes no position on that bill. But we can observe that it
    proceeds from the same concerns that animate our recommendations.
        Our third major recommendation flows from the first two. Individual
    rights and liberties must be adequately protected in the administration
    of the significant powers that Congress has granted to executive branch
    agencies to protect national security. There should be a central office
    or board that has the responsibility to oversee adherence to guidelines
    that are built into these programs to safeguard those rights and
    liberties. We make no recommendation as to how this office or board
    should be composed or where in the executive branch it should be
    located. Some Commissioners believe that it should be a permanent
    office located in the Justice Department and reporting to the Attorney
    General, but with oversight of programs in the Department of Homeland
    Security and other agencies as well as in the Justice Department.
    Others envision a Cabinet-level interagency board or committee,
    reporting to the President. But we are all agreed that some entity of
    this kind should be created.
        We close with an observation from our Report:

            We must find ways of reconciling security with liberty, since
            the success of one protects the other. The choice between
            security and liberty is a false choice, as nothing is more
            likely to endanger America's liberties than the success of a
            terrorist attack at home. Our history has shown us that
            insecurity threatens liberty. Yet, if our liberties are
            curtailed, we lose the values that we are struggling to defend.

        We would be pleased to respond to your questions.

        Mr. Cannon. Mr. Marsh.

      TESTIMONY OF THE HONORABLE JOHN O. MARSH, JR., MEMBER, U.S.
    DEPARTMENT OF DEFENSE TECHNOLOGY AND PRIVACY ADVISORY COMMITTEE

        Mr. Marsh. Thank you, Mr. Chairman, Members of the
    Committee and leaders of the Committee. I thank you for calling
    this hearing. I would point out to you that I am here
    representing an advisory committee appointed by Secretary of
    Defense to the Department of Defense composed of members who
    gave their time to make this study. Therefore, I am not
    speaking for the Department of Defense of what action may or
    may not occur in reference to our recommendations, but I am
    very sanguine about that.
        I would also like to point out, as resource people for the
    committee, which I hope you will avail yourself of, the staff
    director of the Defense TAPAC Committee, Ms. Lisa Davis; an
    extraordinary writer, Fred Cate, who helped prepare all this
    testimony; a technologist and attorney, Lee Zeichner, who is
    here, and also the critical infrastructure protection
    capabilities of George Mason University where I teach and that
    assisted in this.
        Mr. Minow could not be here, but I can tell you he
    performed a yeoman's task of guiding this committee, and his
    enormous prestige and ability I think is reflected in this
    work.
        A little history, if I might. This committee occurred
    because of what was discerned to be abuses, or concerns about
    abuses, largely outside of the Department of Defense on a
    common technique that is growing and needs to be addressed
    called ``data mining.'' Data mining is the result of massive
    volumes of information, either people in or out of Government
    or organizations, and the use of that data mining can be very,
    very helpful in the intelligence process.
        There is a dichotomy here because although the Defense
    Department got in trouble with the pursuit of this,
    nevertheless, the statute to the homeland security authorized
    and encouraged them to engage in data processing. The data
    processing that was occurring in the Pentagon was called TIA.
    Its original name was terrorism information awareness or total
    information awareness or terrorist information awareness,
    whichever one you want, but it raised very serious questions in
    the media and in the Congress of the United States.
        When that happened, Mr. Rumsfeld named this committee, and
    he gave them six questions that he wished to be answered as to
    the validity of that type of technology and whether it could be
    effective, and how do we protect individual liberty and
    privacy.
        Incidentally, I prefer the term ``liberty.'' It is a far
    stronger word than ``privacy.'' Privacy occurs because of
    liberty. Privacy is a subset of liberty.
        Now, these four questions were the questions to which we
    devoted our time and attention. And our first overtures were to
    TIA, which was being done under DARPA, the Defense Advanced
    Research Project Agency, that has done extraordinary work and
    is indeed the agency that developed the Internet. It became
    apparent to the committee that to address this one program,
    TIA, would be putting a finger in a dike where many, many
    fingers were going to be necessary.
        This is a widespread practice in the Federal Government and
    perhaps at State levels. A GAO survey indicated, as we were
    finishing up our work, that there were 88 departments and
    agencies engaged in data mining, or were planning to, that
    there were an additional 34 about to, and in all, there were
    122 data mining programs ongoing in our national Government,
    not just in the Department of Defense. It became very apparent
    to us, as we began to examine people, that data mining was
    going on in other departments of Government. And there weren't
    that many controls in my view and, I think, in the committee
    view as to how that should be handled.
        So what we sought to do--this report is seeking to provide
    some guidelines as to how to utilize data mining, which we
    think is essential only if it is used in a proper way, and we
    believe that it can be. It can use the FICE Accord. It can use
    technologies of minimization where in order to achieve certain
    information you do not have to collect as much as you perceive
    that you have to collect.
        And also, there is the issue of anonymization. There are
    technologies today in seeking records, you can anonymize the
    records so that the people examining the records or capturing
    the information do not know--do not know at the time what that
    information is or they do not associate it with an individual.
    At a later date, under certain guidelines, you can unlock that
    and find that out.
        But one of the things, and it seems to me to be a rule,
    where U.S. persons are involved and you have a particularized
    area of interest in that U.S. person and you go into data
    mining, you use and resort to the FICE Accord. We place stress
    or emphasis on the role of the FICE Accord.
        Now, out of this would come--and I submit to the Committee
    that I will not go through it all; your staff has seen it--
    there came 12 recommendations. Seven of those recommendations
    relate to the Department of Defense, because it was the
    Department of Defense that had asked for these inputs. Five of
    those relate to the Federal Government at large.
        I was very impressed with the legislation that's proposed,
    H.R. 338, that came out of this Committee, because as you read
    our report and read the proposed statute, you begin to see that
    there's a synchronization or there's a common theme through
    there. It may not be the answer yet, but it seems to me steps
    toward an answer.
        So we talk about here how you can establish a process for
    data mining inside the Department of Defense. And the idea was,
    you create a mechanism in the Department of Defense that has
    audit trails, that has overview, that has training, that has
    authorization for certain techniques, and then you extrapolate
    that and replicate those systems of protection into the general
    Federal Government. And this evolved because we got in, we saw
    we had a far, far greater problem.
        It is not simply the Department of Defense, but there are
    other departments and agencies of the Government, and indeed
    data mining is done by the States. The program called Matrix,
    which is a law enforcement program in the State of Florida,
    uses data mining; and Matrix, I think you will find, has
    significant Federal funding from certain other Federal
    agencies, not the Department of Defense.
        But we also place an emphasis on congressional oversight of
    what's to be done. There needs to be a protocol or culture of
    privacy that we need to encourage and develop. So we commend
    those to you.
        I thank you for what you're doing. The stakes are very,
    very high. As I commented to my assistant professor, Ms. Angie
    Chen of George Mason University, who is here today, ``the law
    is going to have to address this.''
        In September of 1787, as Washington was submitting the
    draft Constitution to the convention, of the articles--to the
    Congress--of the Confederation, it had a resolution in it. I
    commend to you that resolution because it read, and it was
    Washington's dilemma, a resolution probably written by Madison.
        Washington fully concurred. The biggest problem, Washington
    said, was drafting a document that was able to reconcile the
    issue of liberty on one side and security on the other.
        That's the problem that we have today. And we see our
    Nation's capital, the people's House is a citadel, with the
    Jersey walls and hydraulic gates and the limitation. Visitation
    here used to be about 22,500. It is down now I understand to
    about 2,000. These are evidences of the oppression and
    intimidation that we are having to suffer because of the
    problems with terrorism. But we will address that and we will--
    and we will be stronger for it.
        I would say to you, I was teaching these issues before 9/
    11. We are feeling that we are being overwhelmed by rapid
    advances in technology, particularly in the information
    communication and information technology which gives the
    terrorists enormous weapons.
        Prior to 9/11, we would not sort out how we were going to
    handle that, and the law was falling behind that technology.
    And the Congress at the time was having trouble coming to grips
    with it in a jurisdictional sense because of its pervasive
    effort. Hopefully, through these types of efforts, we will,
    one, be able to establish jurisdiction, and, secondly, be able
    to achieve a very favorable and satisfactory result.
        I thank you, Mr. Chairman.
        Mr. Cannon. Thank you, Mr. Marsh.
        [The prepared statement of Mr. Marsh follows:]
                  Prepared Statement of John O. Marsh, Jr.\1\
    ---------------------------------------------------------------------------
        \1\ I gratefully acknowledge the assistance in the preparation of
    this statement of Fred H. Cate, a Distinguished Professor and director
    of the Indiana University Center for Applied Cybersecurity Research,
    who served as Reporter for the Technology and Privacy Advisory
    Committee.
    ---------------------------------------------------------------------------
        Chairmen Chabot and Cannon, Distinguished Members:
        I appreciate the opportunity to testify today about the work and
    final recommendations of the Technology and Privacy Advisory Committee
    appointed by Secretary of Defense Rumsfeld and chaired by the Honorable
    Newton N. Minow, one of the nation' most experienced and distinguished
    public servants. The Committee was created to examine the issues that
    are the subject of today's hearing--the impact of the government's use
    of personal information on privacy and civil liberties. Although our
    charge focused on the Department of Defense, we rapidly discovered that
    the issues, as well as the data mining activities that raise them,
    occur throughout the government and require attention.
        I applaud your leadership and that of your colleagues on the
    Committee in holding today's hearing. As a former Member of Congress
    and Secretary of the Army, I know that few issues could be more
    important than the security of the Republic or the civil liberties of
    its citizens. Ensuring that both are rigorously protected is a critical
    obligation of all branches of Government--but especially of the
    Congress--and I congratulate you for embracing that responsibility in
    this hearing today.
               the tension between privacy and national security
        The final report of the 9/11 Commission report does a masterful job
    of describing the horrendous terrorist attacks that took place on the
    morning of September 11, 2001, and of analyzing the factors that
    contributed to our nation's vulnerability to those attacks. The report
    goes on to make a number of thoughtful recommendations, including the
    urgent need that we use all of the information at our collective
    disposal to protect against further attacks, but that we do so only in
    ways that are consistent with protecting personal privacy.
        The 9/11 Commission report does not suggest how we might exploit
    that information without invading privacy. The report identifies the
    goal, without providing any guidance as to the means. The Technology
    and Privacy Committee had spent the prior year addressing many of these
    issues about how we use information to protect national security
    without infringing on privacy.
                              background of tapac
        The history of TAPAC is fully laid out in our final report, the
    executive summary from which I attach to my prepared testimony, so I
    will only briefly recite it here. In early 2002, the Defense Advanced
    Research Projects Agency (``DARPA'') announced that it was developing
    advanced information technologies which could access personally
    identifiable information in the fight against terrorism. The project--
    called ``Terrorism Information Awareness'' (``TIA'') \2\ soon prompted
    serious public and congressional criticism centered on the possible use
    by government of personal information on U.S. citizens and permanent
    resident aliens.
    ---------------------------------------------------------------------------
        \2\ When first announced, the program was entitled ``Total
    Information Awareness.'' The title was changed to ``Terrorism
    Information Awareness'' in May 2003.
    ---------------------------------------------------------------------------
        To address these and other concerns, in February 2003 Secretary
    Rumsfeld appointed the Technology and Privacy Advisory Committee, the
    members of which were private citizens, independent from the government
    and ``selected on the basis of their preeminence in the fields of
    constitutional law and public policy relating to communication and
    information management.'' Establishment of the Technology and Privacy
    Advisory Committee, 68 Fed. Reg. 11,384 (2003) (DOD, notice). He
    charged TAPAC with answering four questions:

            1.  Should the goal of developing technologies that may help
            identify terrorists before they act be pursued?

            2.  What safeguards should be developed to ensure that the
            application of this or any like technology developed within DOD
            is carried out in accordance with U.S. law and American values
            related to privacy?

            3.  Which public policy goals are implicated by TIA and what
            steps should be taken to ensure that TIA does not frustrate
            those goals?

            4.  How should the government ensure that the application of
            these technologies to global databases respects international
            and foreign domestic law and policy? U.S. Department of
            Defense, Technology and Privacy Advisory Committee Charter
            (2003).

        In June 2004, TAPAC released its final report, containing its
    conclusions and 7 and 5 12 recommendations addressing data mining
    within the Department of Defense and throughout the federal government.
    Before turning to those conclusions and recommendations, I want to
    stress two features of the Committee and its work.
        First, the panel was strictly bi-partisan, both in its membership
    and in the way it pursued its work. It was chaired by the Honorable
    Newton N. Minow, Senior Counsel to the law firm of Sidley Austin Brown
    & Wood, who served as chairman of the Federal Communications Commission
    under President Kennedy, and later served as chairman of the Carnegie
    Corporation, Public Broadcasting Service, and The RAND Corporation, and
    vice chairman of the Commission on Presidential Debates. It would be
    hard to find a more impartial, skillful, or experienced public servant.
        The other Committee members with whom I was privileged to serve
    were:

            Floyd Abrams, a partner in the New York law firm of Cahill
            Gordon & Reindel, the William J. Brennan, Jr. Visiting
            Professor of First Amendment Law at the Columbia Graduate
            School of Journalism, and one of the nation's leading experts
            on the First Amendment.

            Zoe Baird, President of the Markle Foundation, and previously
            was senior vice president and general counsel of Aetna, Inc.,
            and an attorney in White House and in the Justice Department.

            Griffin Bell, formerly Managing Partner of King & Spalding, a
            judge on the U.S. Court of Appeals for the Fifth Circuit, and
            Attorney General of the United States.

            Gerhard Casper, President Emeritus of Stanford University and
            the Peter and Helen Bing Professor in Undergraduate Education
            at Stanford.

            William T. Coleman, Jr., Senior Partner and the Senior
            Counselor in O'Melveny and Myers; he served as Secretary of
            Transportation during the Ford Administration.

            Lloyd N. Cutler, founding partner of the law firm of Wilmer,
            Cutler & Pickering; he served as Counsel to Presidents Clinton
            and Carter.

        The second feature is that Secretary Rumsfeld charged the Committee
    with considering not only laws applicable to privacy, but also
    ``American values related to privacy.'' This important addition to the
    Committee's mandate obligated us to ask not only what the law
    concerning government use of personal information was, but what it
    should be.
    the prevalence of government data mining and the limits of relevant law
        From the outset, the Committee was struck by two discoveries. The
    first was how widespread, not only in the Department of Defense, but
    throughout the federal government, data mining was. In fact, report by
    the General Accounting Office, released in May 2004 after the TAPAC
    finished its work, found 42 federal departments or agencies--including
    every cabinet-level agency that responded to the GAO's survey--engaged
    in (88), or were planning to engage in (34), 122 data mining efforts
    involving personal information. Thirty-six of those involve accessing
    data from the private sector; 46 involve sharing data among federal
    agencies. U.S. General Accounting Office, Data Mining: Federal Efforts
    Cover a Wide Range of Uses (GAO-04-548), May 2004, at 3, 27-64, tables
    2-25.
        The Committee's second discovery was how limited the federal law
    applicable to the government's use of personal information really was.
    The law that does exist is often too narrow to ensure either that the
    government can access the data it really needs to protect national
    security and fight crime effectively or that individual privacy is
    protected in the process. In particular, that law depends significantly
    on whether the individual(s) involved are U.S. citizens, where the
    search takes place, whether the information has ever been disclosed to
    third parties, and the government's motivation for the search. In the
    face of new terrorist threats posed within the territory of the United
    States and global information technologies this system has grown
    increasingly unworkable.
        So what the Committee found was widespread data mining, and little
    clarity in the law.
                            tapac's recommendations
        As a result, the Committee focused its deliberations, and
    ultimately its recommendations, on what the law should be to ensure
    that information is used to enhance national security without impinging
    on individual privacy or liberty. We unanimously agreed that the United
    States should use data mining to enhance national security; our
    recommendations then were focused on assuring that the privacy
    interests of U.S. persons are not compromised when it does so. Because
    those recommendations are included in the attached executive summary, I
    will not recite all of them here, but I would like to focus on six that
    are most relevant to today's hearing.
    1. Privacy Tools
        First, we thought it imperative that government data mining
    programs take advantage of the technological and other tools available
    to protect privacy. So, for example, we recommended requiring:

            a.
                Data minimization--the least data consistent with the
            purpose of the data mining should be accessed, disseminated,
            and retained.

            b.
                Data anonymization--whenever practicable data mining should
            be performed on databases from which information by which
            specific individuals can be commonly identified (e.g., name,
            address, telephone number, SSN, unique title, etc.) has been
            removed, encrypted, or otherwise obscured. Where it is not
            practicable to use anonymized data, or access to identifying
            information is required, the agency should comply with
            Recommendation 2.4 below.

            c.
                Audit trail--data mining systems should be designed to
            create a permanent, tamper-resistant record of when data have
            been accessed and by whom.

            d.
                Security and access--data mining systems should be secured
            against accidental or deliberate unauthorized access, use,
            alteration, or destruction, and access to such systems should
            be restricted to persons with a legitimate need and protected
            by appropriate access controls taking into account the
            sensitivity of the data.

            e.
                Training--all persons engaged in developing or using data
            mining systems should be trained in their appropriate use and
            the laws and regulations applicable to their use.
            (Recommendation 2.2)

        We also recommended special protection when data mining would
    involve the use of data from the private sector or other government
    agencies. (Recommendation 2.3)
    2. Privacy Culture
        Second, we thought it was critical that concern for privacy and
    other civil liberties be instilled at every level within agencies that
    engage in data mining. We therefore proposed that agency personnel
    receive appropriate training (Recommendation 2.2(e)), the creation of a
    policy-level privacy officer to help promote sensitivity to privacy
    throughout agencies (Recommendation 4), the appointment of external
    privacy advisors to help provide privacy-related input from outside of
    the agency (Recommendation 5), and that the agency head be charged
    specifically with creating ``culture of sensitivity to, and knowledge
    about, privacy issues'' throughout the agency (Recommendation 7).
    3. Internal Accountability
        Third, we believed that accountability was absolutely critical to
    protecting privacy, to ensuring that data mining was conducted
    efficiently and effectively, and to building public confidence in the
    government's data mining efforts. This objective undergirded many of
    our recommendations. We thought of accountability as occurring in two
    distinct settings: internal and external.
        Internal accountability would be enhanced, we believed, first by
    ensuring that no agency engage in data mining involving personal
    information without making a conscious, thoughtful decision to do so,
    or without fully appreciating the potential privacy ramifications of
    its actions. So, for example, we recommended that data mining require
    written authorization by the agency head. (Recommendation 2.1) That
    written finding would demonstrate that a senior government official had
    thought through:

            a.
                the purposes for which the system may be used;

            b.
                the need for the data to accomplish that purpose;

            c.
                the specific uses to which the data will be put;

            d.
                that the data are appropriate for that use, taking into
            account the purpose(s) for which the data were collected, their
            age, and the conditions under which they have been stored and
            protected;

            e.
                that other equally effective but less intrusive means of
            achieving the same purpose are either not practically available
            or are already being used;

            f.
                the effect(s) on individuals identified through the data
            mining (e.g., they will be the subject of further investigation
            for which a warrant will be sought, they will be subject to
            additional scrutiny before being allowed to board an aircraft,
            etc.)

            g.
                that the system has been demonstrated to his or her
            satisfaction to be effective and appropriate for that purpose;

            h.
                that the system complies with the other requirements of
            this recommendation as enacted by law, executive order, or
            other means;

            i.
                that the system yields a rate of false positives that is
            acceptable in view of the purpose of the search, the severity
            of the effect of being identified, and the likelihood of
            further investigation; and

            j.
                that there is a system in place for dealing with false
            positives (e.g., reporting false positives to developers to
            improve the system, correcting incorrect information if
            possible, remedying the effects of false positives as quickly
            as practicable, etc.), including identifying the frequency and
            effects of false positives. (Recommendation 2.1)

        That written finding would also serve to ensure that a policy-level
    official (in almost every case an official whose appointment was
    subject to Senate confirmation), was involved in making the
    determination to go forward.
        We believed internal accountability would also be fostered through
    the creation of a senior policy-level privacy officer (Recommendation
    5), by regular audits of all data mining programs (Recommendation 2.5),
    by seeking the advice of external privacy experts (Recommendation 5),
    and through renewed efforts by the agency head to ensure the
    ``effective operation of meaningful oversight mechanisms''
    (Recommendation 6).
    4. External Accountability
        Fourth, while accountability within an agency is essential, it is
    no substitute for external accountability, and it was here that our
    strongest--and most controversial--recommendations were focused. I
    suspect it is the failure to provide for meaningful external
    accountability that has contributed to public unrest about programs
    such as TIA and CAPPS II. Our goal was to help diffuse some of that
    controversy in the future by providing for meaningful external
    oversight.
        TAPAC recognized that programs to enhance national security and
    public safety will often involve classified information or require
    speedy action, and so traditional accountability measures (such as
    public notice and opportunity to comment, or judicial review) may not
    work. Nevertheless, we believed that significant tools are available
    and should be required when the government accesses personal
    information about its citizens or legal aliens.

            a.
                Judicial Review

        One critical external accountability measure we recommended is
    recourse to the courts before conducting data mining with personally
    identifiable information about U.S. persons. (Recommendation 2.4) We
    recommended the Foreign Intelligence Surveillance Act court, to help
    provide for speedy and confidential review, but the particular court is
    not nearly as important as the concept of judicial review. The public
    understandably derives confidence from knowing that an independent,
    judicial authority is reviewing government data mining efforts. This is
    especially true when, because of secrecy concerns, the public may not
    have access to information about those efforts.
        We stressed that judicial review could be obtained for specific
    searches or for entire data mining programs (Recommendation 2.4(a)(v)),
    and we provided that, in exigent circumstances, the review could be
    obtained after-the-fact (Recommendation 2.4(c)). Our goal in crafting
    these provisions was not merely to ensure that the process of judicial
    review not interfere with national security, but also to highlight that
    even the exigencies of the war on terrorism do not justify abandoning
    the vital principle of judicial review.

            b.
                Congressional Oversight

        The other essential component of external accountability is
    oversight by the Congress. You are the people's elected representatives
    and it is your unique duty to ensure that the people's business is
    carried out effectively, efficiently, and without compromising the
    people's rights. TAPAC therefore recommended that each agency's privacy
    officer have a direct reporting line to Congress, as you provided with
    regard to the Department of Homeland Security's privacy officer--a
    position ably filled by Ms. Nuala O'Connor Kelly, who appeared before
    TAPAC. We went a step further, however, to recommend that the agency
    head appear as well, and that the privacy officer and agency head
    jointly brief you, at least annually, on

            a.
                the agency's compliance with applicable privacy laws;

            b.
                the number and nature of data mining systems within the
            agency, the purposes for which they are used, and whether they
            are likely to contain individually identifiable information
            about U.S. persons;

            c.
                the number and general scope of agency findings authorizing
            data mining;

            d.
                the number and general scope of agency findings and court
            orders authorizing searches of individually identifiable
            information about U.S. persons; and

            e.
                other efforts to protect privacy in the agency's collection
            and use of U.S. person data. (Recommendation 11)

        These are serious obligations; we meant them to be. Nothing less
    guarantees you the information and regular access to senior personnel
    necessary to provide the accountability that the public expects.
        To carry out these obligations, we made an equally bold
    recommendation that you take the steps necessary to streamline
    committee jurisdiction:

            To facilitate this reporting process and consistent,
            knowledgeable oversight, each house of Congress should identify
            a single committee to receive all of the agencies' reports.
            Other committees may have jurisdiction over specific agencies
            and therefore also receive reports from those agencies, but we
            believe it is important for a single committee in each house to
            maintain broad oversight over the full range of federal
            government data mining activities. To the extent the
            jurisdiction of congressional committees overlaps, we believe
            it is essential for Congress to clarify and clearly articulate
            the relative responsibilities of each committee, to avoid
            undermining either privacy protection or national security
            efforts. (Recommendation 11)

        As a former Member of Congress, I am well aware of the uphill
    battle that such an effort involves, but we believed it is essential
    for meaningful oversight of both privacy and security.
    5. Consistent Laws and Processes
        Fifth, TAPAC recommended that all of the actions outlined above be
    carried out across the government. This would include adopting a single
    framework of legal, technological, training, and oversight mechanisms
    necessary to guarantee the privacy of U.S. persons in the context of
    national security and law enforcement activities; the appointment of a
    privacy officer in every federal agency; and the creation of an inter-
    agency coordinating committee and the use of external advisors to help
    ensure the consistent application of privacy laws and principles.
    (Recommendations 8-10)
        TAPAC recognized that privacy protections would not necessarily be
    the same in every setting, but we believed it essential that they be
    consistent, based on common principles, and subject to uniform
    oversight.
        The recent report of the 9/11 Commission only highlights the
    importance of these recommendations. It makes little sense to
    coordinate this nation's intelligence and national security activities,
    without going one step further to coordinate the laws and processes
    that ensure those activities respect our privacy and civil liberties.
    6. Research
        Finally, TAPAC recognized the importance of research into
    technological and other tools for making data mining more precise and
    accurate and for protecting privacy, as well as into the development of
    policies and laws to facilitate both data mining and privacy.
    (Recommendations 7, 12) One unfortunate consequence of Congress
    blocking further development of TIA was to prohibit further research by
    DARPA into both data mining and privacy.
        This is regrettable; our nation desperately needs to understand
    better the technological, behavioral, and policy tools for using
    information effectively and appropriately, whether to fight terrorism,
    apprehend criminals, or otherwise serve the public. There are many
    private initiatives to expand our understanding--my own program at the
    George Mason School of Law is one example--but if we are serious about
    using information to fight terrorism and serious about protecting
    privacy while doing so, it is going to require the investment of public
    funds.
                 the link between privacy and national security
        I began by describing the tension between privacy and national
    security; I would now like to highlight what TAPAC saw as the essential
    link between the two. Many of our recommendations that may have been
    motivated by a desire to protect privacy, also contribute to enhancing
    security as well. Data minimization, for example, is a key privacy
    tool, but it also helps protect intelligence agencies from being
    overwhelmed by irrelevant data. Tools for data correction are another
    example: data mining with inaccurate data certainly threatens privacy
    and civil liberties, but it also threatens security as well. Any system
    of data analysis that is not concerned with data quality and accuracy
    is likely to compromise both privacy and security.
        Privacy and national security are also inherently linked because
    American values will not accept the latter at the cost of the former.
    Recent protests over TIA, CAPPS II, and other programs have shown that
    the American public will not either. Inadequate, unclear, or uncertain
    privacy laws are slowing the development of new and promising data
    mining programs, they are undermining research into this important
    weapon in the war on terrorism, and they are hampering the very data
    sharing that the 9/11 Commission wisely recommended. Clearing up this
    mess is critical both to protecting our privacy and to protecting our
    security.
                      the role of the judiciary committee
        TAPAC took no position on which committee in Congress should take
    the lead on this vital effort, but I believe the Committee on the
    Judiciary is an ideal choice. The issues involve come within the
    jurisdiction of many committees--Armed Services, Intelligence,
    Commerce, Ways and Means, and others--but the foundational issue that
    cuts across all of these different settings is the constitutional and
    legal framework applicable to data mining. That is the fundamental
    question--the starting place for all other analysis. That is your turf.
    And I assume that is why you have called these important hearings
    today.
                                   conclusion
        Throughout Washington, throughout the nation, citizens are lining
    up to be searched before entering federal buildings or boarding
    aircraft. The mail is delayed so it can be scanned. Luggage is x-rayed
    and rummaged through. Roads are closed, entrances blocked with concrete
    barricades, access to public resources denied. Surveillance cameras and
    identity checks are replacing anonymity. The result is not just
    inconvenience or annoyance, it is a vast toll on our economy and
    productivity and a profound intrusion on our privacy and most basic
    civil liberties.
        Think of the effect on government. The threat of terrorism has
    turned the People's House into an armed citadel. The Capitol, the very
    heart of democratic government, is under siege, and with it our
    privacy, liberty, and most cherished values.
        Data mining--as both the 9/11 Commission and TAPAC noted--is a
    vital weapon in the war on terrorism. It poses grave risks to privacy,
    but there are numerous steps, many (but certainly not all) of which are
    outlined in the TAPAC report, that can reduce or eliminate those risks.
    Those steps may not only protect privacy, but also enhance security as
    well. More importantly, when pursued effectively and subject to
    appropriate safeguards, data mining may threaten privacy and civil
    liberties far less than the other tools on which we rely so heavily and
    so regrettably today.
        Thank you.

                                   ATTACHMENT

        Mr. Cannon. Ms. O'Connor Kelly.

    TESTIMONY OF NUALA O'CONNOR KELLY, CHIEF PRIVACY OFFICER, U.S.
                    DEPARTMENT OF HOMELAND SECURITY

        Ms. O'Connor Kelly. Chairman Cannon, Ranking Member Watt,
    Chairman Chabot, Ranking Member Nadler, Members of
    Subcommittees and distinguished colleagues on the panel, it is
    my great honor to be before you on behalf of the United States
    Department of Homeland Security's Privacy Office, which I am
    privileged to lead as the Department's first Chief Privacy
    Officer.
        I am pleased to offer my reflections on the findings and
    recommendations of the 9/11 Commission Report and also on the
    Report of the Department of Defense, TAPAC, particularly as
    they relate to the privacy of individuals.
        As the first statutorily-mandated Privacy Officer in the
    Federal Government in a role that provides both investigative
    oversight and policy advice, I am keenly aware of the
    challenges presented by the Commission's role. In every
    respect, the 9/11 Commission has met those daunting challenges
    admirably, and I know I join every American in thanking them
    for their work.
        The Report teaches us that one of the reasons the United
    States failed to prevent the September 11 attacks was its
    failure to think creatively.
        As the Commission's work points out, our future requires
    new and creative modes of thinking and demands that we
    institutionalize new and imaginative mindsets within the very
    culture and structure of our Federal Government. Most
    importantly, we must perform our tasks in a manner that
    respects the privacy, the dignity and the personal freedoms of
    each individual in the United States.
        Just as the Commission recommends institutionalizing
    imagination, we at the Department of Homeland Security have
    already begun operationalizing privacy awareness within the
    very culture of our organization. This has meant both
    responding to privacy complaints from within and outside the
    Department and actively raising privacy awareness across each
    of our directorates.
        We have crafted privacy training and privacy policies for
    many of our new programs, ensured that the statutorily-required
    privacy impact assessments and system of record notices are
    written and reviewed, and counseled DHS officials regarding the
    effective and responsible uses of new technologies.
        Outside of our organization, we have reached to advocacy
    groups, to our partners in the European Union and throughout
    the world and to the general public for input and guidance on
    our programs. We are vigorously pursuing our statutory mission
    of ensuring that the Department's technologies and programs
    sustain, and do not erode, privacy protections relating to the
    collection, use and disclosure of personal information.
        No one has been a greater champion in these efforts than
    Secretary Tom Ridge, who from the very inception of our
    Department has recognized that privacy is a vital thread that
    runs through the fabric of the United States. Privacy is a
    value today that we seek to protect, as we protect both the
    tangible and intangible assets of our country through all of
    our endeavors at the Department.
        I wish to thank Secretary Ridge and also Deputy Secretary
    Loy and commend them for their leadership and active support of
    my role and for the efforts of the DHS Privacy Office,
    including our more than 430 Privacy and Freedom of Information
    Act specialists throughout the Department.
        The wisdom that Congress demonstrated when it mandated a
    Chief Privacy Officer and an integrated Privacy Office within
    the Department of Homeland Security represents precisely the
    kind of bold and creative thinking that will be demanded of our
    leaders and policymakers in the post-9/11 world. As the United
    States transforms its Federal intelligence and law enforcement
    communities, operationalizing privacy protections across the
    Federal Government, it is imperative that we sustain this
    dialogue among policymakers, technologists, intelligence
    professionals, law enforcement officials and also the private
    sector.
        The Commission's recommendations raise a number of points
    that are crucial to bear in mind as we move ahead in this new
    process. The Commission points out that the choice between
    security and liberty is a false choice. We as a Nation must
    abandon the pessimistic and misguided notion that in order to
    be safe we must sacrifice the privacy of our personal
    information. The Department of Homeland Security's Privacy
    Office has worked tirelessly to demonstrate that the dichotomy
    between liberty and security is a false one by working in
    partnership with program and policy personnel to embed privacy
    within successful security initiatives from the very beginning.
        As we seek to combine information in new and creative ways
    in the Federal Government, we must also establish and enforce
    concrete safeguards that prevent the Federal Government from
    exceeding its boundaries. As the Commission correctly points
    out, the burden should be on policymakers to prove that any new
    power granted to the Government is accompanied by adequate
    guidelines and oversight to properly confine its use.
        The Commission's report findings heavily underscore the
    need to abandon the compartmentalized structure of our
    intelligence bureaucracy that existed before 9/11 and move to a
    more integrated system. Congress should permit agencies to
    share and disclose information collected for counterterrorism
    purposes if such sharing and disclosure is necessary and
    appropriate to achieve a security function. However, agencies
    should also demonstrate an adherence to privacy principles and
    fair information practices, including educating employees about
    the purposeful and responsible use of information.
        A final matter is the recommendation of the Commission that
    the President appoint a board within the executive branch to
    oversee adherence to these guidelines and recommend the
    commitment the Government makes to defend its civil liberties.
        We are keenly aware in our office of the benefit of having
    a central, coordinating privacy authority that is both
    knowledgeable about organizational structures and yet
    independent enough to act as an effective privacy advocate. It
    is one of the greatest challenges and opportunities of our
    office that we serve both outside and inside roles in the
    structure of our agency. The Chief Privacy Officer is appointed
    by the Secretary, but also is a position created by Congress
    and reports to Congress. The dual aspects of this role have
    allowed our office to turn a critical eye on the most
    controversial and also mundane aspects of the Department's
    operations, while offering a supporting hand to our key
    decisionmakers.
        Any privacy oversight body in a sense must also be both
    outside and inside the Federal Government. Any such body must
    combine real knowledge of ongoing activities with real
    authority to confront and prevent abuse. I look forward to
    sharing my own experiences and participating in the public
    dialogue on such a matter in the coming months.
        I extend my deepest gratitude to Chairman Cannon and to the
    Members of the Subcommittee for your oversight and interest in
    our office, and I thank you for your time and attention.
        Mr. Cannon. Thank you, and thank you to all the Members of
    the panel.
        [The prepared statement of Ms. O'Connor Kelly follows:]
                   Prepared Statement of Nuala O'Connor Kelly
        Chairman Cannon, Ranking Member Watt, Members of the Subcommittee,
    and distinguished colleagues on this panel, it is an honor to testify
    before you today regarding the 9/11 Commission on behalf of the United
    States Department of Homeland Security's Privacy Office, which I am
    privileged to lead as the first Chief Privacy Officer.
        I am pleased to offer my reflections on the findings and
    recommendations of the 9/11 Commission's report. That Commission was
    charged by Congress and our President with the important yet daunting
    task of investigating this tragic event in our history with an eye
    toward implementing future changes. As the first statutorily-mandated
    Privacy Officer in the Federal Government, and as someone who provides
    both investigative oversight and policy advice, I am keenly aware of
    the challenges presented by the Commission's role. It is a role that
    requires both tenacity and discretion, persistent determination and
    unyielding patience, meticulous attention to detail and perceptive
    understanding of the ``bigger picture''. In every respect, the 9/11
    Commission has met those daunting challenges admirably, and I know that
    I join every American when I commend and thank them for their fine
    work.
        We have heard from the Commission's Report that among the many
    reasons for the United States government's failure to prevent those
    dreadful attacks was a failure to think creatively about the challenges
    we faced and to act upon information we received. In the words of the
    Commission, we suffered a ``failure of imagination''. Looking forward,
    it is clear from the Commission's work that the years ahead will
    require new and creative modes of thinking and will demand that we
    ``institutionalize'' new, imaginative mindsets within the very culture
    and structures of our government. Most importantly, we must perform
    these tasks in a manner that respects the privacy, dignity, and
    personal freedoms of every individual who lives in and visits the
    United States. Indeed, years from now, we will be said to have suffered
    yet another tragic ``failure of imagination'' if, while undertaking
    efforts to reform our intelligence community and protect our security,
    we fail to think and act creatively to protect privacy as well.
                 one year onward: protecting privacy within dhs
        My firm belief, which has been affirmed by my experiences during
    the past year, is that protecting both privacy and security is well
    within the grasp of our collective imagination. In fact, during my
    first year as the Chief Privacy Officer of our Department, I have
    operated under that very premise, and have worked to ensure that
    privacy and security go hand-in-hand as we carry out our protective
    mission. In much the same way that the 9/11 Commission recommends
    ``institutionalizing imagination'', we at the Department of Homeland
    Security have begun instituting and operationalizing privacy awareness
    within the very culture of our organization. We have done so by working
    side-by-side with senior leadership and by ensuring that as programs
    move forward to implementation, they have been carefully and thoroughly
    analyzed for their impact on personal privacy. This has meant
    responding to privacy complaints from inside and outside the Department
    and actively raising awareness of privacy across all of our
    directorates. We have crafted privacy training and privacy policies for
    many of our programs, ensured that statutorily-required Privacy Impact
    Assessments and System of Records Notices are written and reviewed, and
    counseled DHS officials regarding the effective and responsible use of
    technology. Beyond our organization, we have reached out to advocacy
    groups and the general public for input and guidance. Moreover, on the
    international level, we have reached important agreements with our
    partners in the EU and elsewhere, and have participated in fruitful
    discussions with organizations like the International Association of
    Data Protection and Privacy Commissioners. In short, my office is
    vigorously pursuing its statutory missions, including ensuring that DHS
    technologies ``sustain, and do not erode, privacy protections relating
    to the use, collection, and disclosure of personal information.''
        It is not an accident that DHS in its very first year began linking
    the values of homeland security and privacy protection as being
    compatible rather than opposing goals. It was a well thought out
    legislative design, firmly embedded in Section 222 of the Homeland
    Security Act, to reflect fundamental American values. No one has been a
    greater champion of this pairing of values than Secretary Tom Ridge,
    who from the very beginning has set the direction ``from the top'' that
    privacy, matters of individual dignity, and civil liberties define the
    fabric of America that we seek to protect in all of our endeavors at
    DHS. Today, I wish to thank Secretary Ridge publicly and commend him
    for his leadership and active support for the role and efforts of the
    Privacy Office at DHS and the entire Privacy team, which includes more
    than 430 Privacy Act and Freedom of Information specialists who work
    throughout the Department.
             looking forward: privacy across the federal government
        The wisdom Congress demonstrated when it mandated a Privacy Officer
    within DHS represents precisely the kind of bold and creative thinking
    that will be demanded of our leaders and policy-makers in a post 9/11
    world. As the United States transforms its federal intelligence and law
    enforcement communities, operationalizing privacy protections across
    all of government will be more imperative, and more challenging, than
    ever. It will require, first and foremost, sustained dialogue among
    policy makers, technologists, intelligence professionals, law
    enforcement officials, and the private sector. The Commission's Report
    has provided an excellent starting point for that dialogue. Their
    recommendations raise a number of points that are crucial to bear in
    mind as we move ahead in this process.
        First, as the Commission quite correctly points out, ``the choice
    between security and liberty is a false choice''. We as a nation must
    abandon, once and for all, the notion that in order to be safe, we must
    give up our right to keep our personal information private. As the
    recent TAPAC Report concluded, ``The stakes on both sides--guarding
    against attacks and protecting privacy--could not be higher. We must
    not sacrifice one for the other. . . .'' Within DHS, the Privacy Office
    has worked tirelessly to prove this point, and to demonstrate that the
    sometimes perceived dichotomy between liberty and security is a false
    one. As I have said on numerous occasions, the protection of privacy is
    neither an adjunct, nor the antithesis to, the mission of the
    Department of Homeland Security. Rather, privacy protection is, in
    fact, at the core of that mission. Likewise, privacy protection must
    also be at the core of our national mission as we devise ways to reform
    and improve our intelligence and anti-terrorist efforts.
        One way that we as a nation can put to rest the perceived dichotomy
    between liberty and security is by unleashing the vast potential of our
    technology. Too often, advances in technology are met with concern and
    trepidation. Yet, just as our technology can be misused to suppress
    privacy, so too can it be used to enhance and protect it. During my
    time as Chief Privacy Officer, I have observed first-hand how
    technology solutions can greatly enhance the privacy of individuals.
    Technical features such as encryption, audit trails, one-way hash
    functions, and tiered access control modules, among others, make it
    possible to analyze information in a way that protects people's safety
    while limiting access to personal information and preserving the
    integrity of data. Moreover, as technologists know quite well,
    information security is paramount to protecting privacy. Therefore, the
    key to ensuring that technologies used by our government sustain and do
    not erode privacy will be to harness the creative energy of those who
    design and implement our technical infrastructures, challenging them to
    devise new solutions that secure and protect our personal information.
                            oversight and guidelines
        Technology and privacy awareness, while important, will not be
    enough to address our current challenges. As we move forward, we will
    also need to establish and enforce concrete safeguards that prevent
    government from exceeding its proper bounds. As the Commission
    correctly points out, the burden should be on policy-makers to prove
    that any new power granted to government is accompanied by ``adequate
    guidelines and oversight to properly confine its use.'' The idea here
    is an important one--privacy protections must be put in place at the
    front-end of our governmental processes when programs are in their
    infancy, rather than later, after privacy abuses and mistakes have
    already taken place.
        The United States has a firm foundation upon which to build
    additional privacy protections. Existing laws such as the Privacy Act
    of 1974, the Freedom of Information Act, and the E-Government Act all
    seek to embed ``fair information practices'' and a general respect for
    privacy into the daily operations of our government. Coupled with our
    Constitutional provisions, these statutes form an essential part of a
    privacy culture that will only become more relevant in the years to
    come. As we build upon this legacy of privacy protection, we must find
    ways to embed these values within the new statutory frameworks that
    will govern the collection, use, sharing, and retention of intelligence
    and other personal information.
        Much of the 9/11 Commission Report's comments in this area address
    the need to integrate and coordinate the data that are collected for
    our antiterrorism efforts more effectively. The Report's findings
    underscore the need to abandon the compartmentalized structure of our
    intelligence bureaucracy that existed before 9/11 and move to a more
    integrated system. It is my view that Congress should permit agencies
    to establish clear parameters for sharing information to protect
    privacy. As some have said, we must move from a ``need to know'' to a
    ``need to share''. Establishing reasonable limits on access and
    embedding fair use principles will be important, not only because it
    will protect individuals, but also because it will engender the kind of
    trust in government that is necessary to achieve the cooperation of
    both the public and private sectors. In failing to abide by these
    principles, we risk replacing the problem of ``stove-pipes'', in which
    disparate pieces of information are never adequately integrated, with
    one of ``leaky pipes'', in which personal information is exposed for
    all to see.
           creating an oversight body for privacy and civil liberties
        I would like to address, as a final matter, the recommendation of
    the Commission that the President appoint ``a board within the
    executive branch to oversee adherence to the guidelines we recommend
    and the commitment the government makes to defend our civil
    liberties.''
        I am keenly aware of the benefits of having a central, coordinating
    privacy authority that is both knowledgeable enough about
    organizational structures to obtain information and yet independent
    enough to act as an effective privacy advocate. It has been one of the
    greatest advantages of my position at DHS that I serve concomitant
    roles both inside and outside the structures of our agency. The Chief
    Privacy officer is appointed by the Secretary, but is a position
    created by statute and required to report to Congress. The dual aspects
    of this role have allowed me to turn a critical eye on the most
    controversial and the most ordinary aspects of the Department's
    operations, while also offering a supportive hand to key decision-
    makers. I do not see my office as the enemy of the missions of the
    Department. Rather, I see it as crucial to achieving that mission
    successfully.
        Implementing such an oversight position for the entire federal
    government is admittedly a different task, one that would require
    attention to matters of a completely different nature and scale. Since
    the government's response to the 9/11 Commission's recommendations is
    still being formulated, it is too early to say precisely what type of
    body will best address the privacy needs of our Federal Government.
    While the challenges and responsibilities faced by the person or
    persons who undertake this responsibility will be distinct from those
    faced by the Chief Privacy Officer at DHS, I look forward to sharing my
    own experiences and participating in the public dialogue on this matter
    in the coming months.
                                   conclusion
        Each and every one of the issues raised by the 9/11 Commission
    regarding the upholding of personal privacy presents a unique but
    highly important challenge to our nation. Facing these challenges will
    require extraordinary imagination. The exercise of that imagination and
    the implementation of the resulting changes certainly will not be easy.
    And yet as Thomas Jefferson wisely noted, ``It is part of the American
    character to consider nothing as desperate; to surmount every
    difficulty with resolution. . . .'' If there is any over-arching lesson
    to be learned from the fine work of the 9/11 Commission, it is
    precisely that. Three years after the 9/11 attacks on New York and
    Washington, and in the memory of those who passed in the fields of
    Pennsylvania, our nation is united in its desire to learn from the past
    by re-organizing and reforming antiterrorism efforts. At the same time,
    we seek to renew our foundational commitment to respecting the privacy
    of each individual, as a matter of law and policy. As the DHS Privacy
    Officer, I work daily to ensure that this sacred commitment--our
    unwavering determination to secure both our liberty and our land--is a
    guiding force behind every decision at the Department of Homeland
    Security. Thanks to the fine work of this Subcommittee, I am quite
    confident that our commitment to the protection of individual privacy
    will continue to guide anti-terrorism efforts not only within DHS, but
    across our entire Federal Government.
        I would like to extend my deepest gratitude to you, Chairman Cannon
    and to the Members of the Subcommittee for your tireless work and
    enduring contribution to our nation. Thank you today for your time and
    attention. I would be happy to respond to your questions.

        Mr. Cannon. I think we are going to proceed by seniority on
    each side of the dais, beginning with the co-Chairman of this
    panel, Mr. Chabot.
        Mr. Chabot. I did mention in my opening statement that I
    have a particular interest in H.R. 338, the Federal Agency
    Protection of Privacy Act, formerly known as the Defense of
    Privacy Act, it is basically the same bill, and I think,
    Senator Gorton and Secretary Marsh, you have both mentioned
    that in your testimony.
        A number of us were very concerned and have been for years
    that too often when regulations or rules were promulgated by
    various agencies that privacy protections of the American
    people too often were kind of an afterthought and were not
    necessarily taken into consideration, and they should be up
    front.
        In essence, what this Act requires is--we all know about
    environmental impact statements--is basically a privacy impact
    statement. What it amounts to is to determine whether or not
    the agency has taken into consideration privacy issues and
    maybe there was an alternative way to be less intrusive on
    those privacy rights, just to make sure we are looking at these
    things ahead of time.
        I actually introduced this back in the 106th Congress; and
    our colleague, Congressman Bob Barr, took it up in the 107th.
    We reintroduced it; and I want to thank my Ranking Member, Mr.
    Nadler from New York, for cosponsoring this and also Chairman
    Cannon for cosponsoring this as well. But it passed in the
    Judiciary Committee back on July 7, so it will be moving
    hopefully to the floor in the near future.
        But I would be interested to hear from the panel members as
    to how they think--and I know, Senator, I think you stated you
    cannot necessarily recommend for or against legislation, but
    how do you think this could potentially impact the issues that
    we are talking about here relative to the 9/11 Commission?
        Mr. Gorton. We in the 9/11 Commission took sort of a self-
    denying ordinance, you know, in not going beyond the
    recommendations that we made. We were perhaps as surprised as
    we were delighted that we were able to come out unanimously,
    and that required a degree of self-restraint. So we cannot take
    a particular position on your bill. But we can say it is quite
    consistent. It certainly seems to proceed from the same
    philosophy that guided us in asking for the creation of this
    board to see to the protection of the civil liberties from any
    new powers granted in the war against terrorism.
        Mr. Chabot. Thank you.
        Secretary Marsh, I didn't know if you wanted to add
    anything.
        Mr. Marsh. I believe that it would be helpful to give it
    more of a defense or national security flavor for those
    portions that involve the Department of Defense or the
    Intelligence Community, and they have to be singled out because
    they are going to have to be treated differently. But I think
    it is a step in the right direction.
        If you look at the recommendations of the Committee Report,
    they are very elaborate recommendations on establishing a
    regime or protocol of how to do this, and it involves the
    President of the United States. We are suggesting also
    overview, not because they are not going to do a good job but
    simply to emphasize the importance of what is being done by the
    legislation.
        I think the legislation is a very good starting point,
    Congressman; and I welcome it. It is responsive to one of our
    problems.
        Mr. Chabot. Thank you very much.
        I am probably not going to be able to get into a lot, I
    have 1 minute left, but one of the other areas that I wanted to
    delve into, maybe some of my colleagues will, is one of the
    recommendations of the 9/11 Commission Report that stated, ``At
    this time of increased and consolidated Government authority,
    there should be a board within the executive branch to oversee
    adherence to the guidelines we recommend and the commitment the
    Government makes to defend our civil liberties.''
        I think prior to deciding the structure of an organization
    there must be a clear understanding of that organization's
    mission. So there are a number of questions that I think at
    some point it would be very helpful to get into, such as does
    the 9/11 Commission view the board recommended in the report as
    being limited to examining privacy, or should it weigh in on
    all things related to the nexus between civil liberties and
    Government action, and would the board be charged with
    evaluating security against privacy protections and would it be
    a watchdog or a facilitator.
        There are many aspects that I think we would be interested
    to get into, but my time has already wound up here, so I will
    yield back my time at this point.
        Mr. Cannon. The gentleman yields back.
        Mr. Nadler, would you like to take the next 5 minutes?
        Mr. Nadler. Thank you, Mr. Chairman.
        Congressman Hamilton, Senator Gorton, in your statement, in
    your joint statement, you said that the test, referring to the
    PATRIOT Act and some other things, the test is a simple but
    important one. The burden of proof should be on the proponents
    of the measure to establish that the power or authority being
    sought would in fact materially enhance national security and
    that there will be adequate supervision of the exercise of that
    power or authority to ensure protection of civil liberties. It
    is sort of a but-for test: but for this power, would we be less
    safe?
        This Committee has repeatedly asked the Attorney General
    that question with respect--or at least some Members of this
    Committee have repeatedly asked the Attorney General that
    question with respect to various provisions of the PATRIOT Act,
    and we have been unable to get any specific responses.
        In other words, if this power which the PATRIOT Act grants
    had existed pre-9/11, would--if that power had existed pre-9/
    11, would it have made a difference in preventing 9/11, for
    example, in your opinion? We have been unable to get any
    answers on that.
        So my question is, in light of that experience, with
    respect to the privacy board or privacy officers you are
    proposing, what steps do you think that we need to take to
    ensure that these officials, one, are independent; two, are
    able to get the information that they need to get in order to
    do their work--information, as I said, this Committee can often
    not get; and, three, that they have the clout needed to have an
    impact?
        Mr. Hamilton. Well, Mr. Nadler, those are difficult
    questions to answer because they really go to the power of the
    Congress to conduct effective oversight. And my view, I guess
    not the Commission's view--I shouldn't try to speak for the
    Commission at this point--but I am very concerned about the
    lack of robustness, if you would, or aggressiveness, in
    congressional oversight today.
        We did not try to get into the specifics of the PATRIOT
    Act, except with regard to the one provision on the wall of
    separation, but we did suggest this test for any official, and
    that is as deeply as we went into it.
        When the executive does not respond to the Congress--and,
    incidentally, we hear that complaint often in our appearing
    before different Committees. It appears to me that the problem
    is quite pervasive in the executive-congressional relationship.
    It is not anything that is new. It goes back for a good many
    years.
        I think there is a lot of timidity in the Congress with
    regard to its exercise of oversight and, at the end of the day,
    they are only going to pay attention to you if you have budget
    authority with them.
        Mr. Nadler. That brings up the real question I am asking,
    which is not simply--I think that this Congress has been very
    timid in exercising oversight, too, but that is really a
    separate issue.
        My point was that we have been unable to get the
    information, and in light of that experience, if we are to
    establish this privacy board, these privacy officers that you
    are recommending, what do we have to do to make sure that they
    can get the information that we have not been able to get, that
    they can get information that they need once we have
    established that they are independent and that they have the
    clout? What powers do we have to give them, what authority do
    we have to give them to make sure they can do the job that you
    are outlining for us?
        Mr. Hamilton. Mr. Nadler, we simply did not try to get into
    the details of the powers that the board would have.
        You mentioned I think a moment ago that Congress has to
    fill in the details, and this is a major detail that you would
    have to fill in. My own personal view is the board should have
    quite robust powers. But the important thing here to recognize
    is that what we have recommended calls for a great deal of
    Government intervention and strengthening of Government powers
    over individual lives. That is just inherent in
    counterterrorism policy. You are greatly expanding the role of
    Government when you are fighting terrorists, and we think it is
    necessary because of the threat.
        Mr. Nadler. Could I have 1 additional minute?
        Mr. Cannon. Without objection.
        Mr. Hamilton. You have to have some check on that
    expansion.
        Mr. Nadler. Which brings me to the other question I wanted
    to ask, and that is an internal board cannot take the place, in
    my opinion, of meaningful court oversight, so to what extent do
    you think--so Secretary Marsh is probably the better person to
    ask this question to--to what extent should there be court
    judicial review of the actions or lack of actions of this board
    or these privacy officers?
        Mr. Marsh. Well, we recommend that there be oversight
    internally and that the oversight will be in the courts. We
    feel that court review at various junctures of this is a very,
    very powerful method of protecting----
        Mr. Nadler. So it shouldn't be an arbitrary and capricious
    standard. You should have better access?
        Mr. Marsh. We insist on access to the FISA courts wherever
    you are dealing with a U.S. person.
        Mr. Cannon. The gentleman's time has expired.
        Mr. Nadler. Thank you, Mr. Chairman.
        Mr. Cannon. Do you want another minute or two?
        Mr. Nadler. I would.
        Mr. Cannon. Without objection, the gentleman is recommended
    for an additional 2 minutes.
        Mr. Nadler. Senator Gorton seems to be interested in
    answering this, too. The question I would like you to address
    is, the courts should have oversight, but very often, in fact,
    even usually, the courts' oversight of administrative agencies
    is limited to an arbitrary and capricious standard, which means
    that what the agency does generally goes, unless their conduct
    is really egregious. Should we establish some other standard
    for reviews and give the courts more power, in effect, to
    second-guess what this board or these privacy officers might do
    or not do?
        Mr. Gorton. Mr. Nadler, I have three points in answer to
    your very good question.
        First, in the two areas, really both relating to the wall
    and on which we did express an opinion, that portion of the
    PATRIOT Act met the tests that we had set out. That was number
    one.
        Number two, you all, in your wisdom, of course, passed the
    PATRIOT Act with an expiration date.
        Mr. Nadler. Part of it has an expiration date.
        Mr. Gorton. At least as far as that part is concerned, you
    have the ultimate power. The Justice Department, obviously, is
    going to have to answer your questions, or you are going to
    have to lie down and ignore a failure to do so. But that is
    probably the greatest single power that you reserved to
    yourself, to see to it that you as the Congress get----
        Mr. Nadler. But the privacy officers and this board are not
    going to have to the power to do this. What do we give them?
        Mr. Gorton. We recommended the creation of a board that
    could protect these rights. As Lee said, we have not gone into
    all of the details as to where it should be. Some the Members
    thought it ought to be in the Department of Justice. I think,
    given your questions, you are probably inclined to believe that
    it ought to be an independent agency or board.
        Those are decisions for you all to make, as are the
    decisions as to the degree of the review for it or the right of
    an individual to sue outside of the system with respect to the
    law.
        Mr. Nadler. I am less concerned where we put it than what
    powers they have, how independent it is, and how we can enforce
    the executive branch to comply with the decisions it makes.
        Mr. Gorton. It should be independent, and it should be
    powerful enough so that it gets listened to.
        Mr. Nadler. Thank you. Thank you, Mr. Chairman.
        Mr. Cannon. The gentleman yields back.
        I hope the panel and also the Members of the two Committees
    will consider that, in dealing with these details, we may not
    have enough information. We may need to be considering a
    commission that will help us think through some of the details,
    because I share the concerns of the gentleman from New York on
    how we go about this.
        The gentleman from Arizona, Mr. Flake, is recognized for 5
    minutes.
        Mr. Flake. I thank the Chairmen, both Mr. Chabot and Mr.
    Cannon, for organizing this hearing and the witnesses for
    coming.
        I want to thank the 9/11 Commission for its particular
    focus on secure sources of identification. That has been
    something that I have been concerned about for a couple of
    years. I introduced legislation last year, H.R. 3461, to
    require States, if they want their State driver's license used
    as a form of Federal identification, or identification for
    Federal purposes, that there have to be some kind of standards
    there. Because, as it stands, if a State like California
    doesn't use the same kind of standards or uses lax standards,
    it doesn't affect just the citizens of California, it affects
    all of us, because it is used increasingly as the closest form
    of a national ID as we have. When it is used for air travel and
    other things, there is certainly a Federal nexus there.
        We also have created more of a Federal nexus when we allow,
    with the Help America Vote Act, an individual State to allow
    them to use a driver's license as a form of identification to
    register to vote. So there is a Federal nexus here, and I am
    pleased with the Commission's focus on this.
        I would just like to get your thoughts on it and how
    quickly we ought to move to that. My bill specifically says if
    a State wants its drivers' licenses used as a form of Federal
    ID, it has to have some kind of standard.
        You have also talked about standards for birth
    certificates, because those are the sort of breeder documents
    that are then used to secure these forms of ID. Can you give
    some elaboration on those things? Mr. Hamilton?
        Mr. Hamilton. Mr. Flake, thank you for the question.
        I think we do suggest in our recommendations that there be
    Federal standards applied to these identification documents,
    birth certificates, driver's licenses and a lot of other
    things. That has to be seen in a broader context, and the
    context is that we need, we believe, a modern border
    immigration system. You have to look at all the ways that
    people get into the United States, and you need to stress
    biometric exit and entry systems. You have got to give these
    officials that check people coming into the country, whether it
    is by land, sea or air, access to information with regard to
    visitors and immigrants.
        You have to have in your Intelligence Community the ability
    to look at the indicators of terrorist travel. Terrorists have
    to travel a lot. You have to develop an exchange of information
    with other countries so that you can make, for example, a real-
    time verification of passports, and you are going to have to
    involve a lot more local and State officials.
        Now, all of those things go together with what you are
    talking about; and the secure identification of U.S. citizens
    becomes very, very important in letting the right people in and
    keeping the bad people out.
        Mr. Flake. What I found was quite striking as well. In
    Arizona, my 16-year-old son just went and got his driver's
    license. His driver's license is good, I think, until he is age
    65. He can get a driver's license theoretically, and he did,
    for 44 years.
        Now, somebody entering the country, for other States to do
    this--gratefully, Arizona does this right. It doesn't anymore
    offer a driver's license for a period longer than the
    expiration of a visa. But only 11 States operate that way.
        In other States that offer--and I don't know how many will
    allow you to get a 44-year license, but if you come on a
    student visa for 6 months or a year or 2 years, you can get a
    license for up to 20 or 30 or perhaps even 44 years, and there
    is your de facto ID. And we know that two of the terrorists on
    9/11 had overstayed, yet they had licenses from States that
    existed for longer than their visa.
        Senator Gorton, do you feel that is an important part as
    well, to ensure that a driver's license, because it is used as
    a form of Federal ID, if you will, not be issued for a longer
    period than the stay of the visa?
        Mr. Gorton. Well, again, the Commission didn't judge that
    specific idea. We did speak, as Lee has said, to birth
    certificates and driver's licenses, because driver's licenses
    are the most common form of identification and our
    concentration was on having uniform standards for them. You are
    talking about a form of uniform standards, at least.
        We are concerned not so much about their length, though
    that is an important consideration, as their validity, as
    really identifying who a person is. That is where our
    concentration lies.
        Mr. Flake. Thank you.
        Thank you, Mr. Chairman.
        Mr. Cannon. The gentleman yields back.
        I am quite certain the gentleman from Iowa, when he has the
    opportunity to speak, is going to be concerned about that
    issue, as I think many of the members of this panel are.
        Mr. Scott, would you like to take 5 minutes?
        Before you do so, let me just point out that the Ranking
    Member has graciously agreed to defer in the event that others
    have to leave. So we have not skipped over Mr. Watt, but he has
    been gracious in letting others go first.
        Mr. Scott.
        Mr. Scott. Thank you, Mr. Chairman.
        Mr. Hamilton, with the extra powers for information
    gathering, wiretapping, data mining and whatnot, did the
    Commission limit these extra powers to terrorism-related
    investigations? The PATRIOT Act was not limited to terrorism,
    and some of us had some concerns about that. Had it been
    confined to terrorism, it might not have been as controversial.
    These extra powers may be extended to any kind of criminal
    investigation.
        Mr. Hamilton. Well, Mr. Scott, our focus was on terrorism,
    and when we recommended, as we do in several places, an
    expansion of Government power, we were limiting it to
    terrorism.
        Mr. Scott. Do I understand that you did not recommend a
    national ID card?
        Mr. Hamilton. We did not.
        Mr. Scott. The no-fly lists have obviously been over-
    inclusive from time to time, as the recent situation with
    Senator Kennedy is just one of the most recent examples. How
    many false positives should we be tolerating before we--I guess
    the more people you stop and keep off the plane, the more
    likely it is that one of them might actually be a terrorist.
    What kind of tolerance should we have for these false
    positives?
        Mr. Gorton. Well, you know, our goal should be no false
    positives. But one of the reasons that we were so interested in
    this subject is that on 9/11 the FAA's no-fly list had 16 or 18
    names on it. That is all. Part of our reason for a National
    Intelligence Director and a National Counterterrorism Center,
    was at the same time the State Department had a list of several
    thousand people that it suspected to be terrorists and the FAA
    didn't even know that the list existed. They learned about it
    at one of our hearings earlier this year.
        So we do think that there should be an integration of valid
    terrorist information about the methods that these terrorists
    used to attack the United States. But it is obviously wrong to,
    you know, confuse one name for another. Just because there is
    one bad guy named Edward Kennedy doesn't mean Senator Kennedy
    should be kept off. We have got to be very careful, it seems to
    me, to see to it that the lists are real lists that identify
    real people and don't have a significant number of false
    positives.
        Mr. Scott. Thank you.
        Secretary Marsh, a lot of the data mining information went
    to the level of personalization of the lists and the
    information but didn't really go to the kind of information
    that we are talking about. What kind of information can be
    obtained in this data mining? Are we talking about, I guess,
    library records, travel records, credit, medical? Exactly what
    are we talking about?
        Mr. Marsh. The databases actually can cover a very broad
    range of different subjects. They could cover travel, they
    could cover finance, they can cover possibly health records, if
    you get an exception.
        The data mining is an accepted and very effective process.
    It is not new. We did data mining with fingerprints and law
    records years ago, but it is now so sophisticated because of
    computerization and it can reach so far and it reaches across
    boundaries and it can be international.
        What we need are methodologies, and I think a number are
    being developed, whereby we can confine those lists very
    quickly and minimize what we have to have, and then anonymize,
    so there is no disclosure of who you are looking at until you
    reach the point.
        Mr. Scott. One of the things we had--I am not sure what the
    status of it is now--the FBI guidelines used to be that you
    wouldn't gather information unless you were actually
    investigating a specific crime or had some specific
    investigation. You just wouldn't gather information.
        Mr. Marsh. I believe that was in law enforcement, wasn't
    it?
        Mr. Scott. Well, are we mining this data just for
    generalized----
        Mr. Marsh. That which is done--defense criteria on data
    mining is different than law enforcement. But in defense that
    is done toward a specific objective, and inside the NSA you
    will find that they are very specifically oriented. I think
    there are 650 million intercepts a day that are filtered
    through. But they are very specific; and they are looking at a
    suspicious, threatening person and using a general pattern
    search to try and find that person.
        Mr. Cannon. Does the gentleman desire additional time?
        Mr. Scott. Could I follow through on that, Mr. Chairman?
        Mr. Cannon. Without objection, the gentleman is recognized
    for an additional 2 minutes.
        Mr. Scott. Thank you.
        Well, are we looking after a specific person to track him
    down in terms of travel and who he is contacting? Still, you
    are looking at one specific person, not just going into a
    database and seeing what pops out.
        Mr. Marsh. Right. Correct.
        Mr. Scott. So you mentioned in law enforcement we are
    relegated to waiting until you are actually investigating a
    crime. In this case, are you just gathering information?
        Mr. Marsh. For intelligence purposes, yes.
        Mr. Scott. Is this United States citizens?
        Mr. Marsh. A United States citizen comes under a court
    order.
        Mr. Scott. So you have to have particularized suspicion.
        Mr. Marsh. That is right.
        Mr. Scott. And probable cause.
        Mr. Marsh. All the rules change when you have a U.S.
    person, which is a United States citizen, a permanent foreign
    resident or a U.S. Corporation that is not foreign controlled.
        Mr. Scott. Thank you, Mr. Chairman.
        Mr. Cannon. The gentleman yields back.
        I guess we are at Mr. Forbes. Would you like to be
    recognized for 5 minutes?
        Mr. Forbes. Thank you, Mr. Chairman.
        Mr. Chairman, I would like to echo what you said earlier
    about the privilege that we have to be with such a
    distinguished panel and also to appreciate the comments of the
    Ranking Member today.
        We have had a number of hearings in different Committees,
    and there have been some individuals who have run out to press
    conferences or made comments in the Committees about why we
    weren't just enacting all the recommendations without hearings.
    I think the comment that said that before we go anywhere we
    need to understand what the recommendations are and the
    ramifications of those recommendations is so true, and I thank
    you all for being here today and your patience in helping us do
    just that.
        Let me go to my fellow Virginian for a question. Mr. Marsh,
    I would like to follow up on what Congressman Scott was saying.
    The first question I would have is so many people today are
    telling us that the only way we can have an adequate defense is
    to do some sort of risk assessment, some sort of risk
    assessment where we are concentrating our defenses, because we
    just have so many vulnerable areas, so it would be impossible
    to cover them all. Can we be effective in that risk assessment
    if we are not doing an effective job with data mining?
        Mr. Marsh. The panel concluded that data mining is an
    absolutely essential tool for a counterterrorist program but
    that data mining program must be formalized, it must be
    established, it must be controlled, it must have procedures, it
    must be audited, and, if you are dealing with U.S. citizens,
    you must use the FISA court.
        Mr. Forbes. Recently, we had a private citizen--that it was
    determined through the use of open-source information that a
    U.S. National Guardsman was plotting terrorist activities on
    his fellow soldiers. This was, obviously, a very ingenious way
    to find a terrorist before they could commit a terrorist act.
    Could you tell us if the TAPAC recommendations limit data
    mining for open source information?
        Mr. Marsh. No. Not completely, no.
        Mr. Forbes. They wouldn't.
        One final thing. Do we have any idea what foreign countries
    are doing right now with data mining and how they are utilizing
    it? I am sure you studied that and analyzed that.
        Mr. Marsh. There are significant private efforts offshore.
    Some of their programs are more strict and stern than ours. I
    believe the oldest is--I may be mistaken here, somebody help
    me--is Sweden.
        What you have touched on, Mr. Congressman, a concern that
    exists in this community with this technology is that we have a
    lead, and we must maintain that lead, and there are abilities
    possibly by others to overtake us in that technological lead,
    and staying--staying in that lead is absolutely essential.
        One of the recommendations of our panel is research on data
    mining that does not necessarily mean go do data mining but do
    the research to find what you can do, what are the capabilities
    you can achieve by doing it, simply in order to maintain a
    supremacy and lead, which we think in this struggle is
    absolutely essential.
        Mr. Forbes. We found the same concern, as you know, with
    biological weapons. Because we had stopped a lot of our
    research on creating some of those weapons, so the counter to
    that was we also had stopped our research on the defense of
    those weapons. As you mentioned, this is a technological edge
    that we could lose in a matter of months if we are not careful
    in how we are handling that.
        Mr. Marsh. It is my recollection that this very fine report
    talks in terms of addressing these research programs to achieve
    some of these ends, if I am not mistaken.
        Mr. Hamilton. Yes, we address that in very general terms.
        Mr. Forbes. Mr. Chairman, thank you very much. Thank you.
        Mr. Cannon. The gentleman yields back.
        I think that Mr. King is next in line. The Vice Chairman of
    the Committee is going to be penultimate or next to
    penultimate. But, Mr. King, you are recognized for 5 minutes.
        Mr. King. Thank you, Mr. Chairman. Again, I thank you for
    holding these hearings today and also Chairman Chabot.
        I appreciate the testimony of the panelists. I know you put
    a lot of hours and days into this endeavor and this interesting
    report that brings some solid recommendations out, and I have
    some questions about a number of those.
        I reflect back, though, across some of the other questions
    and testimony, and Congressman Flake made mention of the Help
    America Vote Act. I would just point out there is not a
    requirement for a picture identification to be presented at
    this point. So there is an allowance there for a poll worker to
    request identification, but not a requirement. So when it comes
    to voting, we don't have any more credibility there than we
    have sometimes getting into the United States. Both of those
    things are important.
        With the passport exception for the Western Hemisphere, one
    can come into the United States from any Nation in the Western
    Hemisphere, other than Cuba, alleging to be a United States
    citizen, simply by making, and I believe the language,
    statutory language, is a credible allegation of citizenship. If
    it were not for that, I might still be in Jamaica, by the way,
    and that is how I know that law. That might not be so bad. And
    I hear your recommendations on tightening that up.
        With regard to Congressman Flake's questions, I would also
    add this point that I would associate myself with the remarks
    of Congressman Hamilton with regard to the security. I direct
    my first question to you, Congressman Hamilton--would you
    consider a biometric Social Security card to be a national ID
    card?
        Mr. Hamilton. I don't think we tried to make those kind of
    judgments. We on the Commission were no experts on this whole
    field--and it is a difficult one--of biometric measures, and we
    did not address that.
        Mr. King. Thank you. I wanted to make just a few remarks on
    the security of our borders and how we might tighten that up.
    But I really would focus my interests instead, because I think
    we have a gap in our focus here, on where these recommendations
    of the Commission might go. Some of the statements that were
    made and some of the language causes my curiosity to be piqued.
        The failure to think creatively I recognize that, and I
    agree with that. But we have a Commission recommendation to
    bring this all under one leadership, one voice, and you looked
    at MI-5 and stepped away from that because it was a higher
    probability of violating privacy and individual liberty. So the
    soaring rhetoric of--let me see, what was that word I was
    looking for--the institutionalization of imagination, it
    captures my imagination.
        I would like to be able to institutionalize imagination. I
    would like to be able to inspire that in all the people that
    can think outside the box and think creatively, and I would
    like to find a way to root out some of the linear thinkers
    within our intelligence departments and replace them with
    creative thinkers. And yet, if I were going to form an
    organization that would be shaping group-think, I would want to
    have one person at the top, all information underneath there. I
    would want to have control of the budget and the hiring and
    firing process, and I would just about bet you if you put me at
    the top of that, I could create group-think within that
    organization. I might even do it without wanting to do so.
        So my concern is that we end up creating an organization
    that does exactly what we are trying to avoid, and I direct my
    question or request for a response for that remark to Ms.
    O'Connor Kelly first.
        Ms. O'Connor Kelly. Well, I would have to defer to the
    experts on the 9/11 Commission, as I am not the expert on the
    Intelligence Community.
        Mr. King. You are the institutionalization of imagination
    though, and I that is why I went to you.
        Ms. O'Connor Kelly. Sure. Absolutely. And I think we were
    quoting language from the report. I think there are so many
    different ways we can create privacy oversight and privacy
    values in the Federal Government. We can look not only at our
    experience with the Department of Homeland Security and having
    a Privacy Office within the ministry or the Department, we can
    look internationally at the creation of privacy czars, privacy
    commissioners, data protection officials throughout the world,
    many of which sit as part of the Federal service but outside of
    any Federal agency. We can certainly look at our own history
    with privacy commissions in previous decades.
        So I think that point is an excellent one. You can't
    legislate creativity. That is precisely a very good point. But
    you can create bodies that will be both self-analyzing and also
    create oversight structures within and outside the Federal
    Government that could hope to create the kind of value
    structure that you are all talking about today in protecting
    privacy and respecting individuality, while also achieving the
    security mission.
        Mr. King. Mr. Marsh, would you comment?
        Mr. Marsh. Congressman, I think the real danger in your
    bill, in our recommendations, is that they will go through some
    sort of baptism of bureaucracy and they will become very, very
    bureaucratic, and instead of doing the innovative, creative
    things that they need to do. I think we need to avoid the
    creation of a bureaucracy there, and that is going to depend on
    the leadership. Because the nature of these types of programs
    are regulatory, and my experience has been with regulatory
    things you get into, actually, a very helpful and useful
    bureaucracy, but I am not sure that is the goal you are driving
    for here.
        Mr. King. Mr. Chairman, could I ask unanimous consent for
    an extra additional minute?
        Mr. Cannon. Without objection, so ordered.
        Mr. King. Thank you, Mr. Chairman.
        I would just direct my question to Senator Gorton then. Did
    you examine the successes, the historical successes of
    intelligence, as you put these recommendations together?
        Mr. Gorton. The answer to that question is, yes, of course
    we have had successes in our intelligence during the course of
    a 45-year Cold War. But I think I would really like to answer
    your previous question, if I may.
        We have had a decentralized system. We have had an FBI that
    didn't talk to the CIA, and a CIA that didn't talk to the
    Department of Defense intelligence agencies. Decentralization's
    ultimate reward was 9/11. What we are trying to do is to cure
    9/11. And this is not to say that there wasn't imagination. I
    think there was a great deal of imagination on the part of the
    FBI agents in Arizona. I think there was imagination on the
    part of those who arrested Moussaoui. I think similar things
    have taken place in the CIA. But, in many cases, they didn't
    even get to the top of their own agencies, much less anyone in
    authority, say, in the White House, who could get the benefit
    of that imagination.
        Our recommendations for a National Counterterrorism Center
    and for the National Intelligence Director are so that there is
    a focal point, someone who is entitled to get all of the
    information, say, on counterterrorism that comes up from each
    of these agencies, put that work together, task them to do
    things to fill in gaps or to fill in holes, and have it there
    before the National Security Council, before the policy centers
    so they can act on it.
        If you read our report through, I think you will join me in
    saying we had a couple of presidents who had to be frustrated.
    They just weren't getting the information that they needed from
    this current stovepipe system where people were hugging onto
    bits of information they got, rather than using them and
    sharing them.
        Mr. King. Did any agency get it right?
        Mr. Cannon. Would the gentleman like an additional 2
    minutes?
        Mr. King. One would be plenty, Mr. Chairman.
        Mr. Cannon. Without objection, so ordered.
        Mr. King. Did any agency get it right?
        Mr. Gorton. Well, if you say did any agency get it right in
    a way that prevented 9/11, of course, the answer to that
    question is an obvious no.
        Did the FBI get it right when it prosecuted those who
    perpetrated the first World Trade Center, yes, they did,
    treating it as a law enforcement matter. But then there was
    this wall. They couldn't talk to one another with their
    intelligence people, and that clearly contributed to 9/11.
        Mr. King. Thank you very much.
        Mr. Hamilton. Mr. King, some agencies got it more right
    than others. The CIA understood the threat of terrorism as well
    as anybody. They spoke about it; and in 1998 the Director of
    the CIA said, we have got a war going on here. The only problem
    is, nobody paid any attention to him. Nobody even within the
    CIA paid any attention to him, and the other intelligence
    agencies didn't pay any attention to him.
        If you want a competition of ideas, which your question
    suggests, you have got to have a free flow of information, and
    that is what we didn't have. If you want group-think, it is the
    status quo that developed group-think. And what we are
    suggesting, I believe, is more vitality, more information in
    the system, which I think will bring about more competitive
    analysis.
        Everybody wants more competitive analysis in theory; not
    everybody wants it in practice. But if you increase the flow of
    information from foreign intelligence and defense intelligence
    and homeland security intelligence and if you increase the flow
    of information from the CIA and the NSA and the NGA and the NRO
    and all of these other agencies that you have that now collect
    intelligence but keep it to themselves, or at least they did
    prior to 9/11, I think improvements have been made since 9/11,
    but what we are trying to do is, to pick up one your words, is
    to institutionalize all of this, to get more information
    flowing through the system.
        We are certainly not trying to put all of the power in the
    National Intelligence Director so that that director controls
    what becomes the intelligence product.
        Mr. King. Thank you, Mr. Chairman.
        Mr. Marsh. Mr. King, in reference to your earlier
    question----
        Mr. Cannon. Mr. Marsh, we have had a note from the C-SPAN
    people. Many of you are not speaking closely enough into the
    mikes. I think, Mr. Hamilton, you have been doing that, so I
    didn't interrupt. If you would pull that mike closer to you.
        That is much better.
        Mr. Marsh. In order to make those sorts of regulatory
    efforts effective, you need to place a burden on the most
    senior officials of the Department--I am talking about the
    Secretary--and you need to establish a role for the President
    to have a responsibility, and then you need to have your senior
    people come in here and respond to your Committee as a form of
    oversight and as a form of legislative audit. Then I think you
    will see the system will function much better.
        Mr. King. Thank you.
        Mr. Cannon. The gentleman yields back.
        The gentleman from Florida, Mr. Feeney, is recognized for 5
    minutes.
        Mr. Feeney. Thank you, Mr. Chairman, for these hearings.
        Mr. Marsh, along those lines, I have read the TAPAC report.
    It is very well done. But the first seven of your 12
    recommendations rely totally on the good will of the Secretary,
    and it is only the executive branch and congressional oversight
    that is addressed in your last five recommendations that will
    make sure future secretaries in not just this but other
    agencies will not just be dependent on goodwill. I would like
    to get back to that in a minute.
        But the other report that is fascinating is the 9/11
    Report, and I really commend the entire Commission represented
    here today by Senator Gorton and Congressman Hamilton. It is
    not just the detail and the breadth and the extraordinary way
    that you have addressed a host of wide-ranging issues, but it
    also I think puts you at a new standard of literary work for
    Government reports. It really is an animated way to deal with
    the technological and historical issues that led up to 9/11 and
    the terror we experienced on that day.
        I have to tell you that I might be the only Member here
    that in the midst of a hurricane had a flashlight out because I
    couldn't put down the book. It is not Hemingway or Shakespeare,
    but I think Arthur Conan Doyle would be proud of what you have
    done.
        Mr. Hamilton. Put it right up there with Harry Potter.
        Mr. Feeney. Yes, and, unfortunately, I don't think you will
    receive any of the commissions for that.
        But, having said that, Congressman Scott talked about some
    very interesting issues earlier, and he sort of drew the line
    between citizens and noncitizens and the right to access, to
    courts, et cetera. But it seems to me one of the things your
    report touches on is the huge difference in kind, not degree,
    but difference in kind between fighting crime and fighting
    actual intelligence threats.
        What we do with respect to bank robbers is put 99 percent
    of our resources into capturing, prosecuting and then punishing
    the bank robber. That model doesn't work when the next plane
    could be full of biological, chemical or nuclear weapons. I
    think that is something Americans have to understand. We are
    dealing with a difference, not in degree, but of kind, in the
    way that we fight these things.
        Much has been made of the stovepipes, and Congressman
    Hamilton just talked about the critical nature of the free flow
    of information internationally and then across Federal agency
    lines. I don't find much in your report on the recommendations,
    and I heard very little emphasis on the free flow of
    information to State and localities.
        The last time the continental U.S. was attacked by a
    serious foreign threat was 1812 when the British burned down
    our Capitol. We now have for the first time since 1812 State
    law enforcement, we have got sheriffs, we have got police
    chiefs, we have got fire departments, we have the private
    sector, people that run flight schools in Florida, for example,
    that have got to be part of the information flow, both from the
    local level up, because they are really your largest set of
    eyes and ears about imminent threats.
        Then, of course, the other way, you have to be able to
    share information. Along those lines, a lot of States have
    privacy protections that are, for example, in Florida, built
    into our Constitution. We have an explicit privacy clause.
        So I would like, Mr. Marsh, as you talk about data mining,
    and also the Senator and the Congressman, to tell us what, if
    anything, as we decide whether or not to set up a privacy
    office in every single agency or every single sub-agency,
    whether we decide to put it at one major level of the Federal
    Government, whether that is inside the White House or whether
    that is independent--those debates are obviously ongoing. But I
    would like to have you tell us what we ought to focus on as we
    use the 280 million sets of eyes and ears around the country in
    sharing information up and down and how privacy can be
    adversely impacted if we are not careful in that flow of
    information stream as well.
        Mr. Hamilton. Mr. Feeney, I will try a cut at it, and I am
    sure others will want to contribute.
        The first point I want to make is with regard to the link
    you suggest between intelligence and law enforcement. That is a
    very important link, and that is one of the reasons we didn't
    go to an MI-5, incidentally.
        The fellow who is out here investigating a crime with the
    idea of prosecution in court will often pick up information
    that is very valuable to the intelligence side of the FBI, and
    vice versa. The person doing intelligence, looking at terrorist
    activity, often will pick up information that is very vital to
    the law enforcement side. So we think there is a natural
    synergy or link, if you would, between the two sides of the
    FBI.
        The second point, we really did address quite frequently
    the need to push information down to the State and local
    officials. My recollection is somewhere in the report we say
    18,000 local officials, police officials and others, are
    enormously important assets for us in terms of counterterrorism
    activity. And we did find, as I think maybe your question
    suggested, that that flow of information was not nearly as good
    as it ought to be. I think here, too, there have been
    improvements, incidentally, but there is a long way to go.
        I believe I am correct in saying that a major concern of
    Director Mueller--I certainly don't want to try to speak for
    him--is to try to improve that flow of information to agents in
    the field; and in some cases, like New York City, I believe the
    relationship between the FBI and the New York City police is
    being worked out quite well.
        But it is a huge advantage for us in counterterrorism to be
    able to take advantage of the local law enforcement people, and
    they simply must be brought into the information pool to a much
    greater extent than has been true in the past.
        Now, the third point I am not sure I caught with regard to
    privacy. You wanted to know how it was adversely impacted by
    all of this?
        Mr. Feeney. Well, we have talked a lot about international
    privacy protections, sharing amongst Federal agencies. But as
    we go up and down from local, State and Federal and the other
    way, what do we need to think about in terms of protecting
    people's privacy there, too?
        Mr. Hamilton. It is a pervasive problem, because if you
    must, as we believe on the Commission, increase the flow of
    information, that means the privacy concerns are greater, and
    that is why we think there has to be some overall direction on
    it within the executive branch and a lot of review, as some of
    the other Members of the Committee have suggested, by courts
    and the Congress.
        Mr. Gorton. Mr. Chairman, may I comment on Mr. Feeney's
    question?
        Mr. Cannon. Absolutely. I think you will note I am fairly
    strict on the time frame for asking questions but try to allow
    some extension of that time, whereas we have not interrupted
    the answers which we find and I think the rest of the Committee
    finds fascinating. So, please, Mr. Gorton, go ahead.
        Mr. Gorton. Mr. Feeney, I think you did have two separate
    questions. There has been a traditional and very legitimate
    objection on the part of local law enforcement officials all
    across the country that communications are one way, that the
    FBI wanted to get information from them, and rarely if ever
    shared it with them. Director Mueller has made significant
    attempts in this connection. The creation of a Joint Terrorism
    Task Force in every major FBI office in the country has done
    so.
        Two weeks ago, I visited with the mayor of Seattle, the
    chief of police, and the fire chief and found that my city had
    done an excellent job in setting up and following some of our
    recommendations on emergency response, setting up the single
    command structure and the like, and asked him just that
    question. And the answer to that question was, yes, it is
    better, but it still has a long way to go. We are not getting
    all of the information down that we need, but progress has been
    made.
        With respect to your other question on privacy, I think I
    might refer you to another report. I am a member of the Markle
    Foundation's study. In fact, with the permission of the
    Chairman, I am going to leave here in about 30 minutes. I am
    due at its meeting in Colorado this evening.
        It has spent a tremendous amount of very constructive time
    on data mining, the questions that Mr. Scott asked, on what can
    be shared and how it ought to be shared and, very specifically
    on this sharing, how will we bring these thousands of local law
    enforcement agencies into this field with a very strong
    protection of human rights. It has now had two reports. Its
    second came out about 6 or 8 months ago. We referred to it in
    our opening testimony here, and I think it will be of great
    value to you in answering that question.
        Mr. Marsh. Mr. Feeney, on the classification, you should be
    aware there are two systems to the classification in our
    country that involve national security and law enforcement. The
    national security is Confidential, Secret, Top Secret,
    Codeword. That is generally the result of an executive order
    over on the defense side. Clearance for those are extremely
    expensive, very hard to obtain. There is inability in our
    Government to transfer those from Department to Department,
    which is a major problem.
        The second relates to the law enforcement type of issues
    that Senator Gorton spoke about. I served for 4\1/2\ years on
    the Gilmore Commission, which looked at local responders. The
    single most frequent complaint that we received from first
    responders from across the Nation was the failure to get
    sensitive or classified information to them that they needed
    for their security purposes. That has improved somewhat by a
    recent order of the Department of Homeland Security but not
    anywhere near where it needs to be.
        This is another area, where some information comes down,
    and it is marked ``law enforcement sensitive.'' Now, it is a
    form of classification. Very frequently, law officers with law
    enforcement sensitive information do not transfer that to other
    people who need to know it inside the community. You have
    broached a matter that is a major, major problem that is really
    administrative but has enormous impacts in other ways of
    operation.
        Ms. O'Connor Kelly. Mr. Feeney, as the operational Privacy
    Officer on the panel, I note that a major focus of our work
    this past year has been addressing exactly the issue you have
    raised of information sharing both across the Federal
    Government but also with the State and local partners.
        Obviously with the major homeland security efforts being
    undertaken at the State level, we are being forced to share--
    and we should be sharing--information with our State and local
    homeland security directors. I see it as sort of a four-tiered
    issue.
        First of all, Homeland Security is made up of 22 different,
    separate parts of agencies. So we had to first construct a
    structure that allows information sharing within the
    Department, which was actually a major undertaking given the
    privacy act systems that existed in those agencies.
        Then to share with other agencies--our partner agencies at
    both Defense and Justice and other parts of the Federal service
    to make those agencies more efficient in the use of
    information--then to share with our State and local partners.
    And finally to share with the private sector. With over 85
    percent of our critical infrastructures in the hands of the
    private sector in this country, we have a need to share and a
    need to know information about their efforts.
        And, of course, as has been pointed out, with the new rules
    under critical infrastructure sharing and sensitive homeland
    security information, we have hopefully heightened the ability
    to share, but also created good rules around the sharing that
    allows our employees to know what should be shared and what
    should not be shared, particularly when it pertains to
    individuals.
        Mr. Feeney. Thank you.
        Mr. Cannon. I would like to thank the very thoughtful Vice
    Chairman of the Subcommittee for that thought-provoking
    inquiry.
        And now the Chair recognizes the very patient Ranking
    Member of this Subcommittee for his opportunity to question for
    5 minutes.
        Mr. Watt.
        Mr. Watt. Thank you, Mr. Chairman.
        And I think I will use my 5 minutes to follow up on some
    lines of questioning that other people have already opened
    before I go to one final overarching question that I would like
    to pose. First, Mr. Nadler raised an interesting question about
    if Congress can't get information from executive agencies, how
    we could set up a board or commission oversight board, and how
    they would get information to do the necessary job that we
    would give them.
        It occurred to me that Ms. Kelly might be in a good
    position to respond to that. She is inside the Government,
    inside the executive branch.
        How would we structure, you think, a board, oversight
    board, to do the kinds of things that the 9/11 Commission
    report has suggested, and give them the kind of authority and
    mechanisms to get the information that they need when we appear
    to be having trouble getting that kind of information
    ourselves? Can you share any light on that, either now or
    subsequent to the hearing?
        If you have got some thoughts now, I would love to hear
    them.
        Ms. O'Connor Kelly. Yes.
        Mr. Watt. If you have follow-up thoughts I would love to
    hear them, too.
        Ms. O'Connor Kelly. Well, I have certainly been thinking
    about this issue for many years, and people wiser than me have
    been thinking about it for many decades.
        So I think there are a number of ways--and I don't want to
    preempt people in the Administration who may have thoughts on
    this themselves--but I think you hit on the exact point that
    the information on--perhaps it is human nature for people to
    not want to air their dirty laundry in public.
        And so to have a privacy office within the Federal agency,
    although it is looked upon somewhat quizzically elsewhere in
    the world, has actually been a very effective structure because
    we are seen as a helpmate in the mission of the Department, but
    also someone who has criticized from within in advance of
    programs being launched. And perhaps that idea is being
    enacted.
        But we also do rest heavily on our external role. And we
    have issued some critical reports of the Department, which we
    will be sharing with you in our annual report to Congress,
    which should be printed and finalized, hopefully, within a
    matter of weeks.
        Mr. Watt. I take it that what the Commission has
    recommended goes beyond privacy officers or bodies within
    agencies.
        Ms. O'Connor Kelly. Right.
        Mr. Watt. You may be suggesting that each agency that is
    dealing in this arena needs a privacy officer. But what the
    Commission, I think, is suggesting is something that--that is--
    --
        Ms. O'Connor Kelly. Overseeing.
        Mr. Watt.--kind of overseeing all of this. And it may be a
    more difficult problem to get agencies to give up the
    information to that external body than even to an internal
    body.
        Ms. O'Connor Kelly. That may certainly be the case. And I
    think for that question, we should look to the experience of
    countries which already have operationalized independent data
    protection authorities. And there is ample evidence of their
    success, both in the European Union and also elsewhere in the
    world. It certainly might be worth even actually talking to
    some of those officials who lead those bodies.
        There is an International Association of Data Protection
    individuals, which we participate in and represent the United
    States to the extent that we are welcomed in that body. They
    have met with greater and lesser success in their own countries
    in doing exactly what you have suggested, getting Federal
    agencies to share information about their operations,
    particularly when it might be damaging or embarrassing to the
    agency--but perhaps a very necessary process.
        Mr. Hamilton. Mr. Watt.
        Mr. Watt. What I might suggest is ask--well.
        Mr. Hamilton. Mr. Watt, the key requirement----
        Mr. Watt. I would just say one other thing that Ms. Kelly
    suggested, she maybe follow up with----
        Ms. O'Connor Kelly. I would be happy to. Okay.
        Mr. Watt.--some written suggestions in response to this,
    because I am going to run out of time. That is what I am
    worried about.
        Mr. Hamilton. Well, the key requirement is that Government
    agencies must be required to respond to the board. Now, the
    experience of the 9/11 Commission is that we had to have the
    subpoena power. We didn't use it very frequently. But if we had
    not had it, our job would have been much, much more difficult.
    And if this board is not able to require agencies to respond in
    detail to your questions, it will be ineffective.
        Mr. Watt. Okay.
        Mr. Watt. Mr. Chairman, I guess I am going to have to ask
    unanimous consent for a couple of extra minutes to get to the
    next two questions that I have.
        Mr. Cannon. Without objection, so ordered.
        Mr. Watt. Let me go. We used the whole 5 minutes on that
    one question.
        I wanted to follow up on this national ID question that
    several people have kind of skirted around. The Commission's
    Report says--and I am quoting, I think--secure identification
    should begin in the United States. The Federal Government
    should set standards for the issuance of birth certificates and
    sources of identification such as driver's licenses. And then
    it goes on and says some other things.
        Now, Representative Hamilton did a great job of telling us
    what he is not suggesting, which is a national ID. What I am a
    little unclear about, and what other people have raised a
    number of questions about, is what, short of a national ID, is
    the Commission suggesting here? Because it sounds like the only
    way you can get to where you are talking about is to have some
    kind of national identification system.
        Mr. Cannon. If the gentleman would yield.
        Could I just add to that, if you have Federal standards and
    a free-flow information system between the States and the
    Federal Government and law enforcement agencies and the Federal
    agencies, what is the difference between standards and a
    national ID?
        Mr. Gorton. Very simply, everyone in the United States, or
    almost everyone in the United States, is comfortable with the
    idea that you have to have a driver's license in order to
    drive. Fifty states and all of the other jurisdictions issue
    driver's licenses. And they do so so that people can be
    identified, you know, when they are driving and when they are
    arrested.
        What we are saying is that it is very important in the
    fight for the struggle for national security that people be
    able to be identified. We now have 50 or 54, whatever it is,
    different systems for that. And we are simply saying, take
    something that everyone accepts now and have it standardized in
    a way that it really identifies the people who are holding onto
    it. And we have also incidentally--and we have mentioned it in
    passing--that we ought to sort of have--it would be a great
    idea to have a standard form of birth certificates; because as
    one of the Members up here said, almost everything stems from
    that, you know, for Americans, all kinds of things you have to
    get a copy of your birth certificate for. And it ought to be
    something that is valid, that people can rely on.
        We would like them to rely on driver's licenses. You don't
    have to get a driver's license if you don't want one. But if
    you want to drive, you do. Let's make it into--let's make it
    into something that really does say, when I pulled my driver's
    license out, you could be confident that this is really me and
    not somebody else.
        Mr. Cannon. Would the gentleman yield?
        Mr. Watt. Yes.
        Mr. Cannon. What I hear you saying, Senator Gorton, is that
    you want a national ID, you want to get that through the back
    door by using something that everybody already accepts. But
    that is, I think you stated very clearly, that you want or you
    think the Commission wants the national ability to identify
    people and using an already accepted purpose. So if you want,
    if you want to drive in America, you have to be part of a
    federalized system of identification?
        Mr. Gorton. I think there is a great deal of difference,
    Mr. Chairman, between something that you voluntarily go out and
    get and something that is mandated.
        Mr. Watt. Well, you might--you might be--this might be a
    semantic discussion. And, I mean, I think the discussion about
    a national ID has been going back and forth for a number of
    years. But it does seem to me that if you are suggesting a
    standardized birth certificate, that is not optional. So for
    newly born individuals, that is a national ID; for people who
    obtain a driver's license, that is a national ID.
        So you have left out people who have come into the United
    States who weren't born here and who don't get a birth
    certificate, or people who have opted not to get a driver's
    license. But you are not very far have having a requirement
    that you have some kind of national identification for those
    people, too, I would think.
        Mr. Hamilton. Well, I would----
        Mr. Gorton. Mr. Watt, you have already got a national ID
    You have one or the other. You just don't know whether it is
    any good.
        Mr. Hamilton. Mr. Watt, just to let you know our concern
    here, all of these hijackers, except one, had U.S.
    Identification. And what we are saying is that secure
    identification is very, very important in terms of
    counterterrorism.
        And we--we did not endorse a national ID. We think there is
    a distinction, as Senator Gorton has said, between Federal
    standards and having a national ID. But do not be deceived here
    with regard to the importance of identification. Keep in mind
    that these hijackers were extremely skillful in being able to
    find the gaps in our system. And we are trying to protect
    against that as best we can.
        Mr. Watt. And do let me be clear that I am not either
    supporting or condemning a national identification system. All
    I am trying to do is figure out what--what those options are
    and be clear on what the Commission is suggesting. Because for
    us to move from the onset that you have expressed to the
    reality of what you have expressed requires our understanding
    what you had in mind. And that is all I am trying to do.
        Let me do one other thing, Mr. Chairman. And I don't really
    think this question may be--well, anybody will want to answer--
    but I think I have got to ask it because there is, it appears
    to me, to be a real rush politically to act on the 9/11
    Commission's Report and a real rush to--for security purposes
    to act on.
        And I guess the thing that I am wrestling with here in
    light of all of the questions that have been raised in this
    hearing is how we can proceed responsibly to get to a real good
    product without giving the public the perception that we are
    somehow dragging our feet and being picky and not paying
    attention to details.
        Did the Commission have any ideas about the timetable? I
    mean, obviously, we are 3 years beyond 9/11. Did the Commission
    have any ideas about the timetable for the implementation or
    passage of whatever legislative initiatives are required to
    implement the 9/11 Commission's recommendations?
        Mr. Gorton. Most of the attention so far to our
    recommendations has been to those two, or several that have to
    do with the structure of our intelligence system, the national
    intelligence director, the national counterterrorism center.
    The former of those has been recommended by probably a dozen
    commissions over years.
        I have got--one of our people yesterday had--no, no,
    meeting over in the Senate yesterday--he showed me a list of 48
    commissions since 1947 that have talked about restructuring our
    intelligence agencies none of which was successful.
        It came from here, you know. The joint--the Joint
    Intelligence Committees of the House and the Senate 2 years ago
    made a recommendation that is at least similar to that.
    Speaking for myself, I am inclined to hope that you do do
    something before the election in that respect.
        Mr. Watt. Can we do something on that front without doing
    something on the fronts that we have been discussing here
    today?
        Mr. Gorton. Well, certainly you can.
        Mr. Watt. I mean, is it advisable? I know the answer is we
    can.
        The question is, would it be advisable to do something on
    that front without--without setting up these security measures
    for individual liberties and privacy that we all know need to
    be in place at the same time that the protections need to be in
    place.
        Mr. Gorton. We believe that the recommendations that relate
    to the Committee, the subject of this Committee, are very, very
    important, Mr. Watt. We wouldn't have included them if we
    didn't. And we thought about them a great deal and dealt with
    them advisedly.
        I guess the other side of that coin is simply this. We know
    those terrorist organizations are still out there. We know they
    have declared war against the United States of America. We know
    that, while either through good preparation or good fortune, in
    the almost 3 years since 9/11 no other terrorist attack has
    taken place in the United States. We also know that lots of
    them have taken place other places in the world.
        So figuratively we have, if not literally, out there in the
    streets somewhere, is a bomb with a fuse and the fuse is lit.
    And we have no idea whether that fuse goes off in 5 days, 5
    weeks, 5 months or 5 years. But it is going to be awfully hard
    to stop the blame game if it goes off when we have done
    nothing.
        Mr. Watt. Thank you, Mr. Chairman. You have been very
    generous with your time. And I yield back.
        Mr. Cannon. Thank you. I want to thank the Ranking Member
    for some very insightful questions.
        I was not clear when we came into this hearing how clear
    you are from the Commission on the need for a national ID or a
    system of national identification. I think that has become
    very, very clear here.
        In addition, I think the question about coming up with a
    good product versus looking like we are dragging our feet is a
    very insightful question. And my reaction to that is we need to
    do some things. I am appreciative of the Administration. I am
    thankful daily that we haven't had in America another serious
    terrorist activity.
        Although I was doing a cottage meeting last night and had a
    very conservative person there who expressed, at some length
    and with some eloquence, appreciation for that, but recognized
    that we have terrorist groups in America that aren't associated
    with al Qaeda, groups that are doing things that by any
    definition are terrorist--and that includes some of our gang
    members, some of our ethnic gang members. We have some very
    serious problems to deal with. We have been very, very blessed.
    Al Qaeda or violent Islam is not our only problem. It is
    internal problems.
        I just feel like we need to point out here--generally
    speaking, I almost never preach from the podium here, but often
    use this to ask questions. I was thinking about George
    Washington, since his name came up a couple of times. He was
    asked at one point what the purpose of the other body was. And
    he had cup of very hot coffee. And he took the cup and poured
    some in the saucer, swirled it around and then drank from the
    saucer. And he said, the People's House, Congress, the House of
    Representatives, is like a turbulent boiling, scalding cup of
    coffee. And the Senate, by the way this is before the 17th
    amendment--I am not sure it still holds--but the Senate is the
    area where we cool it down and sip.
        I feel like we have barely sniffed the coffee, let alone
    gotten ready to cool it down or taste it here. So we have a
    very long way to go, but some things are really remarkable in
    our time.
        In the first place, I look at Ms. O'Connor Kelly. We have
    had a long and very productive discussion. I think she has done
    a remarkably good job at what she has done. She represents
    private industry bringing the most current state-of-the-art
    understanding of technology into the Government. And Government
    is much better because of that.
        And so as you are looking at the questions, Representative
    from Ohio--or Iowa, pardon me. As I am trying to go through
    these complex issues, my dear friend Mr. King suggested
    bureaucratization sets in. But Government is radically improved
    by the interface between free enterprise and new technology and
    our bureaucratic process.
        But at the same time we are getting these little inputs
    that make DHS a much more successful agency, we are
    federalizing more and more issues. And we are doing it because
    it is easier to deal with many of the issues that face us today
    at a Federal level. And some of those are absolutely important
    to be federalized.
        The State of Utah just recently passed a spyware bill. So
    my IT companies are thrilled with that bill. And I have to
    admit, the other day when I was talking to one of them, I said
    that I asked the governor to veto it. And the reason I asked
    her to veto it--obviously not very successfully--is because
    this is truly a Federal issue. You have to deal with that issue
    federally. And if you don't do it that way, you have chaos in
    our system. So we have this period of time where we are truly
    challenged. But the other side, we are responding to those
    challenges, sometimes appropriately, sometimes inappropriately
    with federalization of issues.
        And I am just deeply concerned that in a time of conflict,
    that men of zeal without understanding, or people with zeal
    without understanding, are going to assert that we need to do
    things federally for which there is no alternative. There is
    theoretically another way to deal with that.
        And, Mr. Marsh, you spoke twice about anonymizers. Now I
    think the original Web site that anonymized for people is
    actually in my district. Very cool. This goes way back--by the
    way--we are not claiming all the benefits of modern technology.
    But we have great opportunities with--with technology. And if
    we go down a path of federalization too quickly, we will end up
    with remarkable problems.
        I cannot drive through my major city, Provo, Utah, my most
    central city, without being keenly aware that every stoplight
    has a camera. I am no computer wonk, but I know the process to
    be able to focus, with some artificial intelligence, the camera
    on the driver and get a picture of the driver, and on the
    license plate and get a picture of the license plate of every
    car that goes through every intersection that has a stoplight
    and a camera in that city.
        That gives me the willies, and I think it gives Americans a
    bit of pause. On the one hand, a young woman who was kidnapped
    and the kidnapper was captured very quickly, in part by using
    some of this technology. We do want to stop kidnappers. We do
    want to stop terrorists.
        But I just feel like here in this Subcommittee and in the
    Constitution Subcommittee as well, we need to be looking at
    these issues very carefully and drinking from that saucer and
    not scalding our tonsils as we chug the coffee immediately.
        I also just feel the need to point out that what happened
    on 9/11 was tragic, and a great cost, but it was not entirely
    unanticipated. I think perhaps the magnitude of it was
    unanticipated. But when we set up the CIA and the FBI there was
    a debate, and that debate centered on the core principles that
    we have used to build all of our institutions in America, and
    that is separation of powers. And while, you know, as we look
    at that today, we need to be thinking in terms of the values
    incorporated and what was a system that didn't work very well
    and what we can do with technology today, which allows us to
    bridge the gap and still maintain separate centers of power,
    division of power.
        If you read one of the most remarkable Founding Fathers,
    Thomas Jefferson, he spoke over and over and over again about
    taking power from the highest level of Government and shifting
    or keeping everything down at the lowest level. And if you fly
    over America today and you see the big squares; that is, the
    particular application of Thomas Jefferson's vision of how to
    organize society.
        We did square townships so that towns could grow up in a
    context, and those townships could have smaller units all the
    way down to what we called wards, which were 100 families. And
    his idea of Government was that you govern at the 100-family
    level. And I believe the idea behind the concept of the well-
    organized militia for the second amendment, was that people in
    that 100-family unit would be able to assert police authority
    within that group.
        Now, that is a concept that is embedded in our very
    geography in America, but which is not being considered, I
    don't think, today as we are looking at global attacks. And yet
    as I said earlier, all the attacks aren't global. Many of the
    attacks we have are home grown, homemade. They are not even
    foreign or different ethnicities from the bulk of the Northern
    Europeans who settled America. They are among us today, not
    appealing their sentences, because of the possibility of a
    death penalty if they get a new trial, or if he gets a new
    trial. So I am just--I am just deeply concerned about those
    things.
        I wanted to touch on another couple of points that you
    made, Mr. Marsh.
        You talked about a protocol or a culture of privacy. I
    remember thinking as a kid, no one, no employee of the IRS
    would ever give anyone information that the IRS collected. And
    then we had two Presidents, one of each party, who appear to
    have made even FBI raw data files available to people in the
    press. With that culture destroyed fundamentally--and that is
    not many people, if they have faith that their files are going
    to be kept private--we have to rebuild that culture somehow.
    Rebuilding that culture means going to people with technology
    at the lowest level where they can be protected and anonymizers
    are great possibilities. But you have other issues, like a
    certified identification, which hasn't been mentioned I don't
    think in any of these processes, which today is not used for
    anything but to avoid that little pop-up on your screen that
    says you are not a secure user. And you apparently can now pay
    $49 to get that pop-up eliminated. But it doesn't do anything
    for the issue of identification that we have been talking about
    here today.
        And then finally, I just want to point out that there is a
    lot of vagueness in most Americans' thinking about what they
    want out of privacy. And so I would like to just pause at one
    of the problems, or weigh how to think about that.
        If you saw the movie ``Enemy of the State'' with Will
    Smith, you have an innocent citizen who has something stashed
    in a bag that that then makes him the target of the vast
    bureaucracies of the CIA. And the appalling thing is the
    technology is all there. It was a very cool movie from that
    point of view.
        The likelihood of any of us being the subject of a hunt by
    the CIA is almost nonexistent. But the premise of the film, if
    you will recall, is a Congressman of integrity who wouldn't
    vote in a certain way and therefore was murdered.
        Now, I would like to think that all of my colleagues were
    men of, A, integrity and, B, they have never done anything they
    could be blackmailed with or that could be used to encourage
    them to vote a different way. But in most issues in America
    today, votes at the congressional level and the House of
    Representatives and the other body, or in city council, tend to
    be fairly narrow because we have hard choices. And the ability
    of evil men to get information on decisionmakers at any level
    of Government and thereby pervert decisions, that is what we
    are trying to avoid here.
        And so while driving, I am not worried when my license
    plate is captured, my face is captured by a camera at an
    intersection. But cumulatively in America, we need to be
    concerned about that. Because if you can prove that a city
    councilman was at an intersection near the house of a woman he
    was purported to be having an affair with, there is something
    wrong with that. It's important to the large process of how we
    govern ourselves and how we get good men and women to perform
    public functions without the threat of embarrassment when an
    issue comes up that they need to exercise their judgment on.
        Those are the areas at all levels of Government and in the
    judiciary as well, where I think the issues we are dealing with
    here are important and are worthy of being dealt with
    thoughtfully and carefully over time.
        And I suspect that this Subcommittee, perhaps, the
    Constitution Subcommittee in addition, is going to have a lot
    to say about how we at least approach that problem. And I think
    that means a commission with people who are very thoughtful,
    who have significant background, and who are people who are
    willing to say we don't necessarily need to Federalize this
    process. And if we do Federalize this process, it shouldn't
    just be the damn Feds sucking information out of the local
    folks. It ought to be the local folks who get something back.
    And to do that you ought to have some kind of protection, maybe
    an anonymizer. It may be a culture that existed at one time in
    the Federal Government, I am not sure what it is. It is vital
    to America and it is, I think, the cornerstone of what our
    grandchildren are going to enjoy or suffer in the future.
        So with that, are there any comments by anyone else on the
    panel or additional comments that you on the panel would like
    to make?
        Thank you. I apologize for preaching, but we are adjourned.
        [Whereupon, at 12:35 p.m., the Subcommittees were
    adjourned.]
                                A P P E N D I X

                                  ----------

                   Material Submitted for the Hearing Record

     Prepared Statement of the Honorable Chris Cannon, a Representative in
        Congress From the State of Utah, and Chairman, Subcommittee on
                       Commercial and Administrative Law
        The Subcommittees will please come to order.
        Before we formally start today's proceedings, Chairman Chabot and I
    want to sincerely thank and recognize our colleagues on both
    Subcommittees and on both sides of the aisle for taking time out of
    their busy schedules to attend this important hearing. As many of you
    know, August is typically when Members of Congress return to their
    districts to catch up on constituent matters and spend time with their
    families. Unfortunately, in these extraordinary times, however, we must
    undertake extraordinary measures to deal with certain pressing issues.
        It also goes without saying that we express our sincere gratitude
    to our esteemed witnesses, each of whom reflect the greatest hallmarks
    of public service. We appreciate your contributions to our
    deliberations today.
        The title of today's hearing--Oversight Hearing on Privacy and
    Civil Liberties in the Hands of the Government Post-September 11, 2001:
    Recommendations of the 9/11 Commission and the U.S. Department of
    Defense Technology and Privacy Advisory Committee (which we'll refer to
    as ``TAPAC'')--clearly explains why we're here.
        As many of you know, the 9/11 Commission filed its final report
    last month. As some of you may not know, however, is that the report
    includes several recommendations intended to protect our citizens'
    privacy and civil liberties. In addition, it recommends that the
    federal government set standards for the issuance of birth certificates
    and sources of identification, such as drivers' licenses, to promote
    secure identification information. While most media headlines have
    emphasized the Commission's anti-terrorism proposals, I believe the
    privacy and civil liberties recommendations are among those most
    critical to our nation's future and which will form part of the focus
    of our hearing.
        Today's proceedings will also focus on certain recommendations that
    the TAPAC Committee made regarding safeguarding informational privacy.
    By way of background, TAPAC was established by Secretary Rumsfeld as an
    independent, bipartisan committee to examine the privacy ramifications
    presented by data mining activities by the Defense Department. I think
    we all agree that Secretary Rumsfeld is to be commended for taking this
    initiative and for ensuring that TAPAC's membership included some of
    our nation's most respected experts in the fields of constitutional and
    privacy law. I am informed that among the many luminaries who testified
    before TAPAC was our colleague from New York (Mr. Nadler).
        Advances in technology have increasingly facilitated the collection
    and dissemination of personally identifiable information, but have also
    correspondingly increased the potential for misuse of such information.
    As the recently renamed Government Accountability Office observed,
    ``These advances bring substantial federal information benefits as well
    as increasing responsibilities and concerns.'' Interestingly, TAPAC,
    over the course of its deliberations, determined that as the Defense
    Department was not alone in its conduct of data mining activities, it
    was necessary for it to address this issue through a series of
    Government-wide recommendations.
        The purpose of today's hearing is to examine the validity of these
    recommendations and those of the 9/11 Commission that relate to privacy
    and civil liberties and to determine whether they warrant a legislative
    response. We would especially appreciate any guidance from our
    witnesses about how the Congress, in crafting legislation, can best
    protect our citizens' privacy without compromising legitimate law
    enforcement and terrorism detection efforts. And, as our witnesses
    know, it has been 30 years since a privacy commission was established
    as part of the Privacy Act of 1974. I would be interested in having our
    witnesses comment on whether now is the time to re-establish a privacy
    commission that would specifically focus on government privacy issues,
    especially given all the technological developments that have occurred
    since the commission filed its final report in 1977 and the current
    state of our nation's security concerns.
        I should also note that both my Subcommittee--the Subcommittee on
    Commercial and Administrative Law--and Chairman Chabot's Subcommittee--
    the Constitution Subcommittee--have played a major role in with respect
    to protecting personal privacy and civil liberties in this era of
    heightened security under the leadership and guidance of Jim
    Sensenbrenner, the Chairman of the Judiciary Committee. As both the 9/
    11 Commission Report and TAPAC Report concluded, it is no easy task to
    balance the competing goals of keeping our nation secure and protecting
    the privacy rights of our nation's citizens. I believe that our
    respective Subcommittees and the Judiciary Committee are uniquely and
    best suited to study and resolve these issues.
        Our accomplishments to date include the establishment of the first
    statutorily created privacy office in a federal agency, namely the
    Department of Homeland Security. We have also spearheaded the creation
    of a similar office in the Justice Department, which is contained in
    legislation now pending in the Senate. In addition, both my
    Subcommittee and the Constitution Subcommittee have considered and
    supported legislation requiring a federal agency to prepare a privacy
    impact analysis for proposed and final rules and to include this
    analysis in the notice for public comment issued in conjunction with
    the publication of such rules.
        I will conclude my opening remarks with a quote from one of our
    founding fathers. As I think you'll agree, Mr. Hamilton's observations
    and warnings are as meaningful today as they were when he wrote them
    more than two hundred years ago:
        ``Safety from external danger is the most powerful director of
    national conduct. Even the ardent love of liberty will, after a time,
    give way to its dictates. The violent destruction of life and property
    incident to war, the continual effort and alarm attendant on a state of
    continual danger, will compel nations the most attached to liberty to
    resort for repose and security to institutions which have a tendency to
    destroy their civil and political rights. To be more safe, they at
    length become willing to run the risk of being less free.''

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     Prepared Statement of the Honorable Steve Chabot, a Representative in
      Congress From the State of Ohio, and Chairman, Subcommittee on the
                                  Constitution
        I'd like to thank Chairman Cannon for holding this important
    hearing today.
        September 11, 2001, changed our world. It changed the way in which
    we view terrorism and the way in which we, as a country, must protect
    ourselves.
        Since that tragic day, Congress acted quickly to protect the
    country from future terrorist attacks. For example, through the Patriot
    Act, we provided our law enforcement officials with enhanced
    investigative tools to prevent the planning of future attacks, and we
    authorized the creation of the Department of Homeland Security to
    better coordinate activities within our country to protect against the
    future threat of terrorism.
        In taking action, we have been mindful of the protections afforded
    by our Constitution and our need to protect them as we protect our
    country. In the Patriot Act, we included protective measures, such as
    the sunset provisions. When authorizing the Department of Homeland
    Security, we ensured that a privacy officer position was established to
    examine the implications of the agency's rules and regulations on
    privacy and to address any issues that may result.
        Over the last 20 months, the National Commission on Terrorist
    Attacks Upon the United States (9/11 Commission) has investigated the
    circumstances and events leading up to and on September 11.
        In their report, the 9/11 Commission identified deficiencies within
    the federal government and made recommendations, including
    recommendations to safeguard privacy, to better protect the American
    public. While we must move expeditiously to make our country safer, we
    take care to do so in a thoughtful and Constitutional manner.
        I look forward to discussing the Commission's recommendations with
    our witnesses today and determining what Congress can do to better
    protect the privacy of our citizens.
        As we move forward, it is important to remember that having
    effective anti-terrorism measures does not necessarily comprise the
    protections afforded by our Constitution, as one is not the enemy of
    the other. The enemy is terrorism.

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