[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]
TERRORISM RISK ASSESSMENT AT THE
DEPARTMENT OF HOMELAND SECURITY
=======================================================================
HEARING
before the
SUBCOMMITTEE ON INTELLIGENCE,
INFORMATION SHARING, AND TERRORISM RISK ASSESSMENT
of the
COMMITTEE ON HOMELAND SECURITY
HOUSE OF REPRESENTATIVES
ONE HUNDRED NINTH CONGRESS
FIRST SESSION
__________
NOVEMBER 17, 2005
__________
Serial No. 109-58
__________
Printed for the use of the Committee on Homeland Security
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COMMITTEE ON HOMELAND SECURITY
Peter T. King, New York, Chairman
Don Young, Alaska Bennie G. Thompson, Mississippi
Lamar S. Smith, Texas Loretta Sanchez, California
Curt Weldon, Pennsylvania Edward J. Markey, Massachusetts
Christopher Shays, Connecticut Norman D. Dicks, Washington
John Linder, Georgia Jane Harman, California
Mark E. Souder, Indiana Peter A. DeFazio, Oregon
Tom Davis, Virginia Nita M. Lowey, New York
Daniel E. Lungren, California Eleanor Holmes Norton, District of
Jim Gibbons, Nevada Columbia
Rob Simmons, Connecticut Zoe Lofgren, California
Mike Rogers, Alabama Sheila Jackson-Lee, Texas
Stevan Pearce, New Mexico Bill Pascrell, Jr., New Jersey
Katherine Harris, Florida Donna M. Christensen, U.S. Virgin
Bobby Jindal, Louisiana Islands
Dave G. Reichert, Washington Bob Etheridge, North Carolina
Michael McCaul, Texas James R. Langevin, Rhode Island
Charlie Dent, Pennsylvania Kendrick B. Meek, Florida
Ginny Brown-Waite, Florida
______
SUBCOMMITTEE ON INTELLIGENCE, INFORMATION SHARING, AND TERRORISM RISK
ASSESSMENT
Rob Simmons, Connecticut, Chairman
Curt Weldon, Pennsylvania Zoe Lofgren, California
Mark E. Souder, Indiana Loretta Sanchez, California
Daniel E. Lungren, California Jane Harman, California
Jim Gibbons, Nevada Nita M. Lowey, New York
Stevan Pearce, New Mexico Sheila Jackson-Lee, Texas
Bobby Jindal, Louisiana James R. Langevin, Rhode Island
Charlie Dent, Pennsylvania Kendrick B. Meek, Florida
Ginny Brown-Waite, Florida Bennie G. Thompson, Mississippi
Peter T. King, New York (Ex (Ex Officio)
Officio)
(II)
C O N T E N T S
----------
Page
Statements
The Honorable Rob Simmons, a Representative in Congress From the
State of Connecticut, and Chairman, Subcommittee on
Intelligence, Information Sharing, and Terrorism Risk
Assessment..................................................... 1
The Honorable Zoe Lofgren, a Representative in Congress From the
State of California, and Ranking Member, Subcommittee on
Intelligence, Information Sharing, and Terrorism Risk
Assessment..................................................... 4
The Honorable Bennie G. Thompson, a Rpresentative in Congress
From the State of Mississippi, and Ranking Member, Committee on
Homeland Security:
Prepared Statement............................................. 3
The Honorable Charlie Dent, a Representative in Congress From the
State of Pennsylvania.......................................... 25
The Honorable Daniel E. Lungren, a Representative in Congress
From the State of Caifornia.................................... 4
Witnesses
Ms. Melissa Smislova, Acting Director, Department of Homeland
Security, Homeland Infrastructure Threat and Risk Analysis
Center (HITRAC):
Oral Statement................................................. 5
Prepared Statement............................................. 6
Dr. Henry Willis, Policy Researcher, The RAND Corporation:
Oral Statement................................................. 16
Prepared Statement............................................. 17
Dr. Detlof von Winterfeldt, Director, Center for Risk and
Economic Analysis of Terrorism Events, University of Southern
California:
Oral Statement................................................. 13
Prepared Statement............................................. 14
Ms. Christine Wormuth, Senior Fellow--International Security
Program, Center for Strategic and International Studies:
Oral Statement................................................. 8
Prepared Statement............................................. 10
TERRORISM RISK ASSESSMENT AT THE DEPARTMENT OF HOMELAND SECURITY
----------
Thursday, November 17, 2005
U.S. House of Representatives,
Committee on Homeland Security,
Subcommittee on Intelligence, Information
Sharing, and Terrorism Risk Assessment,
Washington, DC.
The subcommittee met, pursuant to call, at 3:05 p.m., in
Room 311, Cannon House Office Building, Hon. Rob Simmons
[chairman of the subcommittee] presiding.
Present: Representatives Simmons, Lungren, Dent, Lofgren,
and Thompson (ex officio).
Mr. Simmons. The Committee on Homeland Security
Subcommittee on Intelligence, Information Sharing and Terrorism
Risk Assessment, will come to order.
The subcommittee is meeting today to hear testimony on
terrorism risk assessment at the Department of Homeland
Security. We will be hearing testimony from four witnesses
today. We will first hear from Ms. Melissa Smislova, Acting
Director, Department of Homeland Security, Homeland
Infrastructure Threat and Risk Analysis Center.
We will also hear from Ms. Christine Wormuth, Senior Fellow
in International Security at the Center For Strategic and
International Studies.
We will hear from Dr. Detlof von Winterfeldt, Director of
the Center for Risk and Economic Analysis of Terrorism Events
at the University of Southern California.
We will hear from Dr. Henry Willis, Policy Researcher with
the RAND Corporation.
I welcome you all here today.
Preventing terrorist attacks and assuring the safety and
survivability of our Nation's critical infrastructure and key
resources remains at the core of the DHS mission. To accomplish
this mission, it is not enough to simply develop a
comprehensive understanding of what we are protecting and what
it is that is important to us as a Nation. We must also
complete the picture by accurately and quickly fusing that
knowledge with an understanding of America's enemies and the
threats we face. It is only when we are able to successfully
bring these two elements together that we can accurately gauge
and respond to the risks we are confronting in the war on
terrorism. This challenge is at the heart of terrorism risk
assessment at the Department of Homeland Security.
The Department of Homeland Security, as stated in the
Homeland Security Act of 2002, is required to, ``integrate
relevant information, analyses and vulnerability assessments in
order to identify priorities for protective and support
measures by the Department, other agencies of the Federal
Government, State and local agencies and authorities, the
private sector and other entities.'' In other words, to
understand the Nation's vulnerability, to understand the
internal and external threats to our homeland, and to bring
that information together and help ensure appropriate action is
taken and policies enacted.
To more effectively carry out this critical role, the
Department stood up the Homeland Infrastructure Threat and Risk
Analysis Center, or HITRAC.
The Department of Homeland Security has the unenviable task
of gathering vulnerability data from across the United States
from a wide variety of critical infrastructures and key
resources. That data must then be combined with a comprehensive
consequence analysis and further coupled with the best threat
information that Federal, State, local and tribal governments
can provide. This is a vitally important task, and while it
must be done as quickly as possible, it is also important to
get it done right, putting the highest priorities first.
We look forward to hearing your views on how the Department
and the risk analysis community are meeting that challenge and
working to ensure the security of the homeland.
The Chair now recognizes the ranking minority member of the
subcommittee, the gentlelady from California, Ms. Lofgren, for
any comments she might have.
Ms. Lofgren. Thank you, Mr. Chairman. I am glad that we are
turning our attention today to the Department of Homeland
Security's approaches, capabilities and plans regarding the
third component of this subcommittee's oversight jurisdiction,
terrorism risk assessment. This is the first time that we are
addressing this risk assessment issue directly and, more
specifically, the criteria the Department should consider as
part of its work in this area.
If done correctly, a coordinated terrorism risk assessment
will go a long way to help the Department decide where to
target investments in combating terrorism, what critical
infrastructure to secure and how to set priorities on the basis
of risk.
Developing an effective risk assessment strategy is
especially important as we acknowledge that our private sector
partners now own approximately 85 percent of the critical
infrastructure in this country. In order to get the private
sector to buy in to what the Department is doing in this area,
however, we need the Department to partner effectively to
develop consistent and flexible risk assessment criteria and to
create incentives to ensure private sector participation.
While I am certain that the testimony today will address
all of these issues, and while this hearing is clearly an
important one, I nevertheless wonder if we are not putting the
cart before the horse. Most risk analysts agree that before you
can do meaningful risk and threat assessment, you must first
know what it is that needs protecting.
The administration began an effort to create a national
database of potential terrorist targets such as dams,
pipelines, chemical plants and the like, more than 2 years ago.
It was supposed to use that database to prioritize assets in
order of risk and to harden facilities and systems accordingly.
I am sorry to report that the database is still full of holes
and has not been finished.
Because the Department lacks the methodology to rank
critical assets contained in the database, incomplete as it is,
the Department to date has essentially assembled a spreadsheet
of targets that, for the most part, does not tell the
Department or Congress what to protect first or why.
Part of the problem stems from the Department's failure at
the outset of the database project to set clear standards for
which assets should and should not be considered critical for
homeland security purposes. Indeed, this lack of standards
resulted in a miniature golf course in my home district being
included as a critical homeland security asset. This would be
funny if the stakes were not so high. Without standards, how
that miniature golf course ranks in priority against protecting
the Capitol building or a chemical facility or subway system
remains an important question that the Department can't answer.
I am dismayed that as of late last week the Department
still had not submitted a report on its progress in completing,
first, risk and vulnerability assessments of the Nation's
critical infrastructure; secondly, the accuracy of the
government's plans to protect such infrastructure; and finally,
the government's readiness to respond to threats against the
United States. Pursuant to the Intelligence Reform Act, that
report was due this past June.
I look forward to hearing about HITRAC and how the
Department might consider assessing risk on a going forward
basis. I am also particularly interested in what the risk
assessment experts with us today have to say about how the
Department should do this important work and how effective
terrorism risk assessment can really be without a prioritized
dynamic list of critical assets to guide the Department's
efforts.
I look forward to your testimony, and I welcome your
participation in this hearing.
Thank you, Mr. Chairman.
Mr. Simmons. I thank the ranking member.
The Chair recognizes the ranking member of the full
committee, the gentleman from Mississippi, Mr. Thompson, for
any statement he may wish to make.
Mr. Thompson. Thank you very much, Mr. Chairman. I look
forward to the testimony of the witnesses for the hearing
today. I have a written statement, and I will submit it for the
record. Thank you.
[The statement of Mr. Thompson follows:]
Prepared Opening Statement of Hon. Bennie G. Thompson
I am very pleased that this Subcommittee is addressing
the issue of how the Department conducts terrorism risk
assessments.
This function is critical to driving informed decisions
about where to spend our homeland security dollars to protect our
people, to secure our critical infrastructure, and--hopefully--to
thwart terrorist attacks.
I am very pleased that we have with us today a
representative from HITRAC (``High-Track'')--the Department's Homeland
Infrastructure Threat and Risk Analysis Center.
Since it was created in January of this year, HITRAC has
fused the talents of both intelligence analysts and infrastructure
protection experts within the Department in order to separate the wheat
from the chaff when it comes to terrorist risks and threats.
I note that in many ways, HITRAC embodies what Congress
had hoped the Information Analysis and Infrastructure Protection
Directorate would be--a center for intelligence analysis and risk
assessment devoted to protecting and securing the homeland.
I sincerely hope that HITRAC can efficiently do what IAIP
apparently could not, and I am interested in hearing about what lessons
HITRAC has learned from the IAIP experience.
This hearing, moreover, could not be more timely. On
November 2nd, the Department finally released its draft National
Infrastructure Protection Plan--which I note HITRAC's operations will
support once the NIPP is finalized next year.
Among its provisions, the draft NIPP addresses the need
for a common approach to assess risk in order to set protection
priorities.
The draft NIPP likewise references the RAMCAP--a series of
terrorist risk assessment tools that the Department is presently
developing. Unfortunately, the draft NIPP is short on details about
what criteria should apply to ensure effective assessments.
It appears, however, that the Department may face
significant hurdles in obtaining RAMCAP participation.
Some in the private sector have complained that the
Department has offered few incentives to the private sector for RAMCAP
participation.
Compliance with RAMCAP methodologies, moreover, is purely
voluntary.
And according to the NIPP, the Department is planning to
create multiple versions of the RAMCAP applicable to different
sectors--rather than a single, flexible standard.
I look forward to hearing all of the witness' views of the
draft NIPP and the RAMCAP generally, as well as suggestions for
improving upon the Department's risk assessment approach on a going
forward basis.
Thank you for joining us today.
Mr. Simmons. I thank the gentleman.
I notice we also have the gentleman from California here
today, Mr. Lofgren. As is our custom, you are free to insert
any statements you may wish for the record.
Mr. Lungren. I am Mr. Lungren.
Ms. Lofgren. He is my cousin, not my brother.
Mr. Lungren. Tomato, tomato, and I notice it is HITRAC, and
as Ms. Lofgren and I both call it, HITRAC, because I think we
were both English majors in college.
Mr. Simmons. I thank the gentleman for his correction.
The Chair now calls our panel of witnesses. What I will do
is read a short bio for each witness before they make their
statement. That way it will be fresh in our minds, their
background and their experience. I will advise the witnesses
that we do have their full statement in the record which we can
read and follow. If they wish to summarize we will be providing
5 minutes for their statements, at which point we will then ask
questions.
Our first witness is Ms. Melissa Smislova, currently
serving as Acting Director of the Homeland Infrastructure
Threat and Risk Analysis Center. I call it HITRAC. I kind of
like that better. It may be HITRAC. Maybe you can answer that
question when you begin.
Prior to joining DHS, she spent almost 20 years in the
field of intelligence analysis, most recently at the Defense
Intelligence Agency. She brings a wealth of intelligence and
analytical experience to her current role, which will serve the
Department of Homeland Security and HITRAC well as they work to
fulfill the critical mission of protecting our homeland from
terrorist attack.
I thank you for being here today. Please begin your
testimony.
STATEMENT OF MELISSA SMISLOVA, ACTING DIRECTOR, DEPARTMENT OF
HOMELAND SECURITY, HOMELAND INFRASTRUCTURE THREAT AND RISK
ANALYSIS CENTER
Ms. Smislova. Good afternoon, Mr. Chairman, and
distinguished members of this committee. Thank you for having
me here today to speak with you about the role of the Office of
Intelligence and Analysis in the development of the DHS risk
assessment process.
As Secretary Chertoff has reinforced, DHS has adopted a
risk-based approach in both our operations and in our
philosophy. Because intelligence is a key component of risk
analysis, the Office of Intelligence and Analysis, as well as
the Office of Infrastructure Protection, did establish the
Homeland Infrastructure Threat and Risk Analysis Center, which
we do call HITRAC. HITRAC is meant to--
Mr. Simmons. Boy, what a terrific witness we have.
Ms. Smislova. Thank you, sir.
HITRAC is meant to institutionalize risk assessments, as
well as to produce some tailored threat assessments that can
support the protection of the national critical infrastructure
and our key resources. HITRAC reports both to the Office of
Intelligence and Analysis, as well as to the Office of
Infrastructure Protection, and we are comprised of members that
belong to both groups.
Under this dual structure, the priority of our
infrastructure work requirements does come from the Office of
Infrastructure Protection under the Assistant Secretary, Robert
Stephan, but the approval of all the intelligence-derived
production does remain with Mr. Charlie Allen, the new
Assistant Secretary for Intelligence and Analysis.
The HITRAC mission represents a unique capability within
the U.S. Government. Our threat analysts have access to
traditional Intelligence Community reporting and the data, as
well as to the DHS component intelligence and information
reporting. Our HITRAC infrastructure protection sector
specialists, on the other hand, who possess the private sector
expertise and sector-specific incident data, identify the
sector-specific vulnerabilities and the consequences of a
possible terrorist attack. Our HITRAC analysts then integrate
all of this available information into strategic level risk
assessments for the Federal, State and local authorities, as
well as the private sector.
In addition, we believe that our intelligence products are
more relevant to infrastructure owners and operators because we
frame our analysis in the context and unique operating
environment of our diverse and specific critical infrastructure
partners.
We receive information about United States critical
infrastructure through our Information Sharing and Analysis
Centers, the ISACs, as well as through our contacts through the
private and public infrastructure owners that have already been
established by our colleagues in the Office of Infrastructure
Protection and throughout the Preparedness Directorate.
In addition, we are able to refine our national level
Intelligence Community collection requirements by working back
through the Office of Intelligence.
DHS defines risk as the determination of weighting the
factors of threat, vulnerability and consequence. While
inherently the most subjective component of this risk equation,
the threat of the enemy attack is derived from a study of enemy
intent and capability. The intent of this particular adversary
is assessed after study of all available information that we
have about what this adversary wants to accomplish by attacking
the United States. We work with our partners in the
Intelligence Community to understand as much as we are able
about the terrorists' goals, plans and desires.
We match what we know about the intentions of this
adversary with information that we do have about how this enemy
is capable of accomplishing an attack. For this part of the
equation, we rely both on what we see the enemy discussing,
recruiting and training, as well as the lessons that we are
learning from his attacks overseas.
We work all the pieces of this puzzle together. HITRAC's
unique partnering with the infrastructure protection
specialists that are not professional intelligence officers
allows us a different view of the data than what we believe our
Intelligence Community colleagues sometimes have.
One example of the integration of how Department of
Homeland Security integrates threat analysis into our risk
assessments is shown in our HITRAC production plan to support
the National Infrastructure Protection Plan. Directed by the
Homeland Security Presidential Directive 7, the National
Infrastructure Protection Plan is a unified national plan for
the consolidation of critical infrastructure protection
activities. We call that the NIPP.
The NIPP is a collaborative effort between the private
sector, State, local, territorial and tribal entities and all
relevant departments and agencies of our government. The
cornerstone of the National Infrastructure Protection Plan, the
NIPP, is a risk management framework that combines threat,
vulnerability and consequence information.
Mr. Simmons. If you want to summarize? I have actually read
your statement. I am sure we all have.
Ms. Smislova. Yes. That is just why we have established a
HITRAC, to accomplish those specific tasks. Thank you.
[The statement of Ms. Smislova follows:]
Prepared Statement of Melissa Smislova
Introduction
Good afternoon, Mr. Chairman and distinguished Members of this
Committee. I am here to speak with you about the role of the Office of
Intelligence & Analysis in the development of DHS risk assessments.
As Secretary Chertoff has reinforced throughout his tenure, DHS has
adopted a risk-based approach in both our operations and our
philosophy. There is no question that intelligence is a key component
of risk analysis. For this reason, the Office of Intelligence &
Analysis and the Office of Infrastructure Protection established the
Homeland Infrastructure Threat and Risk Analysis Center (HITRAC) to
institutionalize strategic risk assessments and produce tailored threat
documents in support of the protection of national critical
infrastructure and key resources (CI/KR).
Homeland Infrastructure and Risk Analysis Center
The Homeland Infrastructure Threat and Risk Analysis Center (HITRAC
) reports to both the Office of Intelligence Analysis (OI & A) and the
Office of Infrastructure Protection (OIP). It brings together members
of the Intelligence Community under OI & A and infrastructure
specialists from the OIP as well as experts from the National
Communications System and the National Cyber Security Division, among
others, to produce strategic-level risk assessments. Under this dual
structure, priority of infrastructure work requirements come from the
Assistant Secretary for Infrastructure Protection, Mr. Robert Stephan,
while approval for all intelligence derived production remains with the
Assistant Secretary for Intelligence and Analysis, Mr. Charlie Allen.
The HITRAC mission represents a unique capability within the U.S.
Government. HITRAC threat analysts have access to traditional
intelligence community reporting and data as well as to DHS component-
specific intelligence and information reporting (for example,
information gathered at the ports of entry and transportation centers
by DHS component members). HITRAC infrastructure protection sector
specialists, who possess private sector expertise and sector specific
incident data, identify sector-specific vulnerabilities and
consequences of attack. HITRAC analysts then integrate all available
information to produce strategic-level risk assessments for Federal,
State and local authorities and the private sector.
HITRAC crafts products that make intelligence information more
relevant to infrastructure owners and operators by framing our analysis
in the context and unique operating environment of all seventeen CI/KR
sectors. HITRAC receives information about the critical infrastructure
through our Information Sharing and Analysis Centers and through
contacts with private and public infrastructure owners that have been
established by the OIP and throughout the Preparedness Directorate. In
addition we are able to refine national intelligence community
collection requirements though working with OI&A.
In addition, HITRAC produces threat products for infrastructure
owners and operators to use in their own risk calculations and for DHS,
state and local entities, and other Federal entities to use in their
own planning and operations. DHS defines risk as a determination of
weighing the factors of threat, vulnerability and consequence. While
inherently the most subjective component of the risk equation, threat
of enemy attack is derived from study of enemy intent and capability.
Intent of this adversary is assessed after study of all available
information about what they want to accomplish by attacking the United
States. We work with our partners in the intelligence community to
understand as much as we are able about the terrorists' goals, plans,
and desires. We match what we know about the intentions of the
adversary with information we have about what the enemy is capable of
accomplishing. For this part of the equation we rely both on what we
see the enemy discussing, recruiting and training for as well as
lessons learned from overseas attacks. We work all the pieces of the
information puzzle. HITRACs unique partnering with Infrastructure
Protection specialists that are not professional intelligence officers
allows us a different view of the data than our IC colleagues.
Threat Products Supporting the National Infrastructure Protection Plan
One example of the integration of threat analysis with DHS risk
assessment efforts is in the HITRAC production plan to support the
National Infrastructure Protection Plan. Directed by Homeland Security
Presidential Directive 7 (HSPD-7), the National Infrastructure
Protection Plan (NIPP) is a unified national plan for the consolidation
of critical infrastructure protection activities. The NIPP is a
collaborative effort between the private sector, State, local,
territorial and tribal entities and all relevant departments and
agencies of the Federal government.
The cornerstone of the NIPP is a risk management framework that
combines threat, vulnerability, and consequence information to produce
a comprehensive, systematic, and informed assessment of national or
sector risk that drives our protection efforts in the CI/KR sectors.
This framework applies to the general threat environment as well as
specific threats or incident situations.
HITRAC's production plan supports the NIPP. The NIPP promises
sector specific threat information to each sector following its
finalization. Our analytic products are designed to provide threat
information to the private and public infrastructure owners and
operators. In particular we are producing:
Sector Assessments for each CI/KR sector. HITRAC
through the OI & A and in coordination with TSA and USCG
intelligence entities will produce several sub-sector
assessments due to the broad characteristics of some sectors
(for example, HITRAC will produce sub-sector assessments for
aviation and mass transit which are sub-sectors of the broader
transportation sector). HITRAC leverages the expertise of
several sector specific agencies, including the Transportation
Security Administration, as well as our colleagues in the
intelligence community to support our efforts. These products,
written at multiple classification levels, provide DHS a
vehicle to deliver long-term strategic assessments of sector
risks by detailing HITRAC analysis of the intentions and
capabilities of known terrorists and integrating relevant
threat information with the unique vulnerabilities and
consequence of each sector.
HITRAC is also producing Common Threat Themes in
support of the NIPP and other DHS and Federal risk assessments.
These threat scenarios are descriptions of potential attack
methods based on known or desired terrorist capabilities. These
scenarios, which will be updated as needed, are detailed
vignettes of the methods terrorist might use to attack the US
infrastructure and are derived from the study of terrorist
intentions and capabilities. These scenarios are intended to
inform vulnerability and consequence analysis while ensuring
that a given risk analysis has taken into account the minimum
set of potential attack vectors and the associated
vulnerabilities and consequences.
These threat themes are used as the foundations to design and build
the threat scenarios used by the Office of Domestic Preparedness. The
scenarios used for ODP exercises are lengthy depictions of how a
notional terrorist attack might unfold and they are drafted to test
prevention and response capabilities. HITRAC's threat themes are
specific descriptions of ways the enemy can attack and are for use by
private and public infrastructure owners and state and local
governments to develop their own risk assessments. For example, they
describe in detail what we know about how the adversary can employ a
vehicle borne improvised explosive device.
Conclusion
The Federal government and private sector owners and operators need
intelligence-based risk assessments to best protect against and respond
to potential terrorist attacks. DHS established HITRAC to provide
integrated strategic risk assessments and tailored threat products in
support of the protection of critical infrastructure and key resources
throughout the nation. This is a very challenging mission, but with
your support, we will succeed.
Thank you.
Mr. Simmons. Thank you very much.
Our next witness is Christine Wormuth, Senior Fellow in
International Security at the Center for Strategic and
International Studies, where she focuses on homeland security
policy, U.S. national security strategy and policy and defense
requirements and resource issues.
Prior to joining CSIS, she was a principal at DFI
Government Services, a defense consulting firm, where she
developed a methodology to assess homeland security risks,
including an analytical tool that comprehensively evaluates
homeland security risks in terms of their potential to occur
and possible consequences. She works closely with elements of
DHS and the Homeland Security Council on a wide range of
implementation issues aimed at increasing the preparedness
level of the United States.
Thank you for being here. You may begin.
STATEMENT OF CHRISTINE WORMUTH, SENIOR FELLOW, INTERNATIONAL
SECURITY PROGRAM, CENTER FOR STRATEGIC AND INTERNATIONAL
STUDIES
Ms. Wormuth. Thank you, Mr. Chairman, and thank you other
members of the subcommittee for asking me to testify here today
on this important topic.
Assessing homeland security riskS, which, of course, can
come both from terrorism but also from natural disasters, is an
enormously complex undertaking, but it is also, as you all know
well, a critical task if the government seeks to marshal its
finite resources effectively.
I think Ms. Smislova has very well covered the basic
components of risk assessment, so I will try to focus my
comments on some of the challenges that I think are inherent in
developing risk assessments for homeland security, as well as
some observations about the broader strategic role that I think
risk assessments can play in this field.
The basic formula for risk assessment is simple. It is
essentially probability, which is threats and vulnerabilities
times the consequences of particular attacks, and that equals
the risks. But in practice, I think analysts and experts face a
lot of important practical challenges when they try to go about
the task of assessing homeland security risks.
One challenge, of course, is the lack of quantitative data.
We can't determine the probability in a scientific sense of a
terrorist attack, the percentage chance that a particular type
of attack might occur, nor do we have extensive quantitative
data at this point on the specific economic costs or the
potential numbers of fatalities or serious injuries that are
associated with different types of attack. One way to
compensate, of course, for these challenges is to use expert
judgment and to use computer modeling and simulation to
extrapolate information based on what we do know.
Another challenge I think that is important to note is how
to handle intelligence in these types of assessments, and
specifically by that I mean how can DHS develop models that
factor in specific intelligence without skewing the assessment
away from areas where we may not have specific information.
Coming out of the Defense Department, I am fond of quoting
Secretary Rumsfeld, who has said we don't know what we don't
know. Just because the Intelligence Community doesn't know that
a terrorist group doesn't have WMD does not mean that they
don't in fact have some sort of capability.
I think another policy challenge here is weighting the
different pieces of a risk assessment. For example, should we
weight different types of critical infrastructure targets or
other critical assets more heavily in an assessment because a
group like al-Qa'ida has expressed the intention to attack
them, or should we weight human deaths and injuries more
heavily than other elements of consequences. Those are policy
decisions that I think we need to grapple with.
Despite these challenges, I heartily believe that risk
assessment is a very powerful tool for homeland security
policymakers and should be at the heart of our approach.
I do want to observe that I think DHS would serve not just
itself as a department but the entire interagency, all of those
cabinet agencies that have a role in homeland security, by
taking the lead in developing what I like to call a National
Homeland Security Risk Assessment.
I see this as being something like a National Intelligence
Estimate in that it would be developed on a regular basis,
perhaps every couple of years, and it would serve as the
authoritative assessment of risk and trends of significance in
the area of homeland security.
In my view, development of a National Risk Assessment
should be actually an interagency undertaking, not just a DHS
undertaking, although DHS should certainly be in the lead. But
I think to really develop this kind of risk assessment it would
be useful to draw on the expertise and the viewpoints of the
other cabinet agencies that have a role in this field.
I think a National Risk Assessment should focus on
developing a strategic picture in the near term, at least in
terms of setting broad priorities and directions, and then the
details, all of those very important details, can be filled in
over time with tools that are specifically developed to capture
all of the nuances of the information.
In my view, a risk assessment of this type could strengthen
our homeland security policy development process and resource
allocation process in three important ways: First, in guiding
Homeland Security planning. At CSI, as noted in our recently
released ``Beyond7 Goldwater-Nichols Phase II'' report, a
strategic risk assessment really needs to be at the heart of
developing concepts of operation for homeland security. It
should also serve I believe as the basis for developing
national homeland security planning scenarios.
The 15 scenarios released by the Homeland Security Council
are an important first step, but I think these scenarios would
carry more weight across the interagency if they were based on
a strategic risk assessment.
Of course as you know, a risk assessment is very important
in driving the resource allocation process. Again, I think a
strategic risk assessment could harmonize our efforts, not just
in DHS, but across the entire intergency, which would go a long
way towards maximizing our unity of effort.
Lastly, I think a risk assessment tool would help us
evaluate the program options for mitigating consequences and
enhancing our preparedness system, helping us think about where
do we get our best bang for the buck.
I will just conclude by noting that in my view, as you
know, Secretary Chertoff has called on Congress to approve an
Under Secretary for Policy. Assistant Secretary Baker sits in
that chair right now. I believe one of his central
responsibilities should be taking the lead in developing this
kind of National Homeland Security Risk Assessment and then
institutionalizing its results into the DHS resource allocation
process and policy planning process.
My colleagues at CSI have called on DHS to deliver a
National Homeland Security Assessment by December 2006. I think
this is still a very reasonable deadline. Obviously it would be
wonderful to have more time, but I think given we are 4 years
after September 11, it is very important to have a National
Homeland Security Risk Assessment soon, even if it means that
we as Americans, as you in Congress and our leaders in the
executive branch, have to make choices based on less than
perfect information. I think it is important not to let the
best be the enemy of the good.
I thank you very much for the opportunity to share my
views.
[The statement of Ms. Wormuth follows:]
Prepared Statement of Christine E. Wormuth
Mr. Chairman, Ranking Member Lofgren, members of the subcommittee,
thank you for inviting me to testify before you today on assessing the
risks of terrorism.
Assessing homeland security risks, which can stem from both
terrorism and natural disasters, is an enormously complex undertaking
but is also a critical task if the federal government seeks to marshal
its finite resources effectively. Before turning to the key policy
issue of how to use risk assessments to maximize unity of effort at the
federal level, I would like to briefly outline what makes a basic risk
assessment and some of the challenges inherent in trying to assess
homeland security risks.
As Secretary Chertoff has emphasized since being named Secretary of
Homeland Security, focusing on the ``trio of threat, vulnerability and
consequence as a general model for assessing risk'' is at the heart of
the DHS approach. It is worth peeling back the layers of the onion in
those three areas a bit more fully to understand the complexities
associated with assessing homeland security risks.
In most formal discussions of risk assessment, risk is defined as
the product of the probability that a certain event might occur--a
suicide bomber attack on a hotel such as we saw take place last week in
Jordan--and the consequences that could result from such an event. The
probability side of the equation is basically a combination of threats
and vulnerabilities. Threats could be assessed in terms of the
different kinds of weapons and delivery systems that might be available
to our enemies. In some cases weapons could be relatively difficult to
acquire or develop, like the smallpox virus or a small nuclear device,
or they could be much more common--an improvised explosive device
carried on a delivery truck. Assessing vulnerabilities means
establishing the pool of possible targets--which could include
buildings that are vulnerable every day like chemical plants or once-a-
year events like the Super Bowl--and determining how vulnerable they
are to the full range of threats. The final piece of a basic risk
assessment involves looking at the consequences that might result from
different attacks. Consequences might include not only the deaths and
injuries that could result, but also the economic and psychological
costs of a given type of attack, and the length of time it takes to
resume normal activity levels after the attack.
The basic formula for a risk assessment is simple--probability
times consequences equals risks--but in practice assessing homeland
security risks poses some important practical challenges.
One challenge is the lack of quantitative data on which to base
assessments of probability and consequences. We cannot determine the
probability of terrorist attacks--the ``percent chance'' that a
specific type of attack might occur. Nor do we have extensive
quantitative data to pinpoint the numbers of potential fatalities or
economic costs that might be associated with particular kinds of
attacks. And how should we begin to think about psychological
consequences? Can they be expressed quantitatively? We can use expert
judgment and computer models to extrapolate representations of
probability and consequences but they will be just that--
representations rather than certainties.
Another challenge is how to handle intelligence. Many of you on the
committee have noted the importance of intelligence in developing
homeland security risk assessments. But determining how to incorporate
intelligence effectively is a challenge for analysts. How can DHS
develop models that factor in specific intelligence we may have about
particular targets or payloads without skewing an assessment toward
only those risks on which we have intelligence? As Secretary Rumsfeld
has often said, ``we don't know what we don't know,''--just because the
intelligence community does not have information that suggests a
terrorist group has a WMD capability does not mean that group doesn't
have a WMD capability. Or vice versa.
Whether to weight the different pieces of a risk assessment is
another challenge. Should some kinds of targets be weighted more
heavily if we know groups like al-Qa'ida have expressed the intention
to attack them? Should human deaths be weighted more heavily than other
types of consequences? By how much?
Despite these formidable challenges, it is absolutely worth the
time and effort to develop robust homeland security risk assessments
that can guide our planning and policy development. Risk assessments--
even if they are based on imperfect intelligence, expert opinion, and
computer simulations of potential consequences--give us the tools to
examine many different pieces of complex information in a structured
way. They focus attention on the specific judgments that cumulate into
an overall risk ranking and hence they can be ``unpacked'' to better
understand where differences of opinion may lie and how they affect the
assessment. Policy makers can use the structure that risk assessments
provide to understand clearly where there are disagreements in the
expert community, and can then assess for themselves the different
sides of the debate before coming to a policy judgment that may have
profound implications down the road.
DHS would serve all of the Cabinet agencies with homeland security
responsibilities well by taking the lead in developing a ``National
Homeland Security Risk Assessment'' that would assess and rank the full
spectrum of plausible homeland security risks--an assessment that would
look comprehensively across all of the kinds of critical infrastructure
and other potential target types combined with the different weapon
payloads and delivery systems that adversaries might seek to use
against the United States. As this Committee knows well, the
legislation that established DHS stipulated that the department would
develop a comprehensive risk assessment. This assessment is still of
paramount importance.
This type of assessment, much like a National Intelligence
Estimate, would be developed on a regular basis, perhaps every couple
of years, and would serve as the authoritative assessment of homeland
security risks, identify trends of significance for homeland security
and if necessary, identify differences of views about risks among the
principal senior leaders in the U.S. government homeland security
arena. Development of a National Risk Assessment should be an
interagency undertaking, with DHS in the lead, but with significant
support from the broader intelligence community, DoD, HHS, the
Department of Energy, other Cabinet agencies, and leaders from the
private sector and industry. A National Risk Assessment would sacrifice
examining the threats, vulnerabilities and consequences of every
possible scenario in their fullest details for a process that could
generate actionable results in the near-term, at least in terms of
setting broad priorities and directions. Subsequent, more detailed risk
assessments focused on specific threats or infrastructure sectors could
then fill in the details over a longer period of time.
A National Risk Assessment could strengthen the homeland security
policy development and resource allocation process in at least three
very important ways.
Guiding homeland security planning.. As CSIS noted in
its recently released Beyond Goldwater Nichols Phase II report,
before the interagency can develop robust concepts of
operations for homeland security, it needs to conduct a
strategic risk assessment. A National Risk Assessment would not
only serve as the basis for developing common interagency
strategies for addressing specific homeland security
challenges, it would also serve as the basis for developing
national homeland security planning scenarios. Putting forth
the fifteen Homeland Security Council scenarios was an
important step toward harmonizing ongoing planning activities,
but those scenarios could play a larger role in driving policy,
planning, and programming if they were based on the results of
an interagency-agreed National Risk Assessment.
Driving the resource allocation process. Many have
noted the importance of using risk assessments to set broad
priorities for how DHS allocates resources. Looking beyond DHS,
a National Risk Assessment could serve as the basis by which to
harmonize not just DHS resource and policy decisions, but
homeland security related resource and policy decisions across
the entire interagency. This would go a long way toward
creating maximum unity of effort across the USG in this
critical area.
Evaluating potential policy and programmatic options.
Where should DHS and other agencies invest their marginal
dollars? What will give us more bang for the buck, ten more
bomb detector dog teams, 50 more handheld radiation detectors,
or 100 more border patrol agents? These are the kinds of real
world decisions DHS and other agencies have to grapple with in
their budget processes, and risk assessment tools can help shed
light on these choices in a structured way.
Secretary Chertoff has asked Congress for the authority to
establish an Under Secretary for Policy in DHS. This is a very
important and much needed position, and it is good news that Mr.
Stewart Baker was confirmed earlier this year at the Assistant
Secretary level. In my view, one of his central responsibilities should
be to lead the development of a National Risk Assessment, working
closely with his peers in the other relevant Cabinet agencies, and then
to institutionalize the results into DHS's broader strategic planning
and resource allocation processes. The Under Secretary, with his direct
access to Secretary Chertoff, can elevate and integrate the many useful
risk assessment processes ongoing inside DHS to help build a coherent,
comprehensive risk assessment picture that truly drives policy and
programming at the strategic level. In DHS 2.0, Rethinking the
Department of Homeland Security, my colleague David Heyman at CSIS and
James Carafano of the Heritage Foundation called on DHS to deliver a
comprehensive risk assessment to our top national security leaders by
December 2006. I think this remains a reasonable deadline. Highly
granular assessments will clearly be needed, and there are assessment
tools in development that will help us make finely tuned adjustments to
our prevention, response and preparedness programs over time. But
today, more than four years after the September 11 attacks, we need a
comprehensive National Risk Assessment--and we need it soon. That means
senior leaders, in the Executive branch and here in Congress, will have
to make choices and set priorities on less than perfect information.
That said, I suspect most Americans would prefer to see the government
make those tough choices rather than letting the best be the enemy of
the good. I applaud this Committee for engaging on this issue and thank
you for the opportunity to share my views.
Mr. Simmons. Thank you for that testimony. That will lead
to some interesting questions, I am sure.
Our next witness is Dr. Detlof von Winterfeldt, who is the
Director of the Center for Risk and Economic Analysis of
Terrorist Events at the University of Southern California. He
is also Professor of Public Policy and Management in the School
of Policy Planning and Development. His research interests are
in the foundation and practice of decision and risk analysis as
applied to technology, environmental and security problems. He
is the coauthor of two books and the author or coauthor of over
100 articles and reports on these topics.
Thank you very much for being here. We look forward to
hearing your testimony.
STATEMENT OF DR. DETLOF von WINTERFELDT
Mr. von Winterfeldt. Thank you very much, Chairman Simmons,
Ranking Member Lofgren and distinguished members of the
subcommittee. It is truly an honor to appear before you today
to discuss the topic of terrorism risk assessment.
I would like to cover three areas in this opening
statement. I will briefly introduce you to the Center of Risk
and Economic Analysis of Terrorism Events, called CREATE; I
would like to provide some background on risk assessment and
its uses over the last 30 years in various government agencies
and private enterprises; and I would like to end by commenting
on the uses, opportunities and important challenges of using
risk assessment in the homeland security area.
CREATE was the first university-based center of excellence
funded by the Department of Homeland Security. It was selected
in 2003 in a competition of 72 universities and we started
operations in March 2004. CREATE is located at the University
of Southern California and has partners at NYU and at the
University of Wisconsin and other universities across the
country. Our main goal is to develop advanced risk assessment
tools and economic tools for homeland security decisions.
Let me turn a little bit to risk assessment in the broader
context. Risk assessment has a very long history, dating back
to studies of nuclear power plant safety and spacecraft safety
in the 1970s. Today, risk assessment is successfully applied in
areas as diverse as medicine, business, environment, industrial
safety and natural disasters. A typical risk assessment answers
three questions: What can go wrong, how likely is it and what
are the consequences? My overall impression is that risk
assessment has been very successfully applied by identifying
risks and by developing cost-effective solutions to reduce
risks in these areas.
The application of risk assessment to terrorism is fairly
new, providing new opportunities and challenges. Natural and
engineered systems are ``neutral'' agents who don't seek out
our vulnerability. Terrorists, in contrast, are the adversaries
who attempt to attack us where we are weak, and furthermore
they adjust their actions in response to our defenses. This
non-random nature of terrorism complicates risk assessment and
requires the development of new tools.
In spite of these challenges, risk assessment has made
considerable progress in the terrorism area in the past few
years. An important distinction, as mentioned earlier, in risk
assessment for terrorism is the difference between threat
assessment, vulnerability assessment and consequence
assessment.
I don't want to repeat what the previous speakers have
said. I just want to bring one point clearly home, and that is
that threat assessment is by far the hardest part of terrorism
risk assessment. This deals with assessing terrorist
motivations, capabilities and intent. Assessing vulnerabilities
is somewhat easier, and we have developed tools based on
project risk analysis to do this task.
Finally, the assessment of consequences, given a successful
attack, as terrible as these consequences may be, can be
pursued with relatively off-the-shelf methods that are usually
provided by the national laboratories.
Another distinction is between the various levels of
homeland security decision making. We typically distinguish
between decisions on specific countermeasures; for example,
specific decisions on MANPADS countermeasures.
The second area is prioritizing and resource allocation
within a threat area; for example, prioritizing infrastructure
threat targets, which is much of the topic of this committee.
Finally, the high level policy decisions having to do with
resource allocation between broad threat areas; for example,
within rad-nuke, biological and infrastructure threats.
Our recent studies suggest that specific countermeasure
decisions can well be supported with risk assessments, and
CREATE has made some contributions in this area which I would
be happy to discuss with you later. We also see some progress
in the use of risk assessment within threat areas. For example,
in the past few years, several commercial risk analysis tools
have been developed for a session risk infrastructure targets
and prioritizing them.
Risk assessment at the highest policy level is difficult
and will necessarily involve expert judgment and more
qualitative forms of analysis. However, overall, I am very
optimistic that risk assessment can improve our Nation's
decisions to counter terrorism, and much progress has been
made, but there are also many challenges ahead.
I thank you very much for this opportunity to address you.
[The statement of Mr. von Winterfeldt follows:]
Prepared Statement of Detlof von Winterfeldt
Chairman Simmons, Ranking Member Lofgren, distinguished members of
the Subcommittee: It is an honor to appear before you today to discuss
the topic of terrorism risk assessment.
I'd like to cover three areas in this opening statement. First, I
will briefly introduce you to the Center for Risk and Economic Analysis
of Terrorism Events (CREATE); second, I'd like to provide some
background on risk assessment and its uses in the past 30 years in
government agencies and private enterprises; third, I'd like to comment
on the uses, opportunities and challenges of risk assessment in the
homeland security area.
CREATE is the first university-based center of excellence funded by
the Department of Homeland Security. It was selected in a competition
of 72 universities and started operations in March of 2004. CREATE is
located at the University of Southern California with partners at the
University of Wisconsin, New York University and faculty affiliated
with the Massachusetts Institute of Technology. CREATE researchers are
developing advanced risk assessment models and tools for homeland
security decisions. We also study the economic impacts of terrorist
events and develop computer models and analysis tools to assist
decision makers in government and industry to allocate funds to counter
terrorism.
Risk assessment has a long history--dating back to studies of
nuclear power plant and spacecraft safety in the mid 70s. Today, risk
assessment is successfully applied in areas as diverse as medicine,
business, environment, industrial safety and natural disasters. A
typical risk assessment answers three questions:
1. What can go wrong?
2. How likely is it?
3. What are the consequences?
In addition, risk assessments examine what can be done to reduce
the likelihood of failures and the magnitude of consequences and to
evaluate the effectiveness of alternative investments in improving
safety. My overall impression is that risk assessments in these applied
areas have been very successful by identifying risks and by developing
cost-effective solutions to reduce risks.
The application of risk assessment to terrorism is relatively new
providing new opportunities and challenges. Natural and engineered
systems are ``neutral'' agents, who don't seek out our vulnerabilities.
In these areas we also have a fair amount of experience and data that
can be used to estimate probabilities and consequences. Terrorists, in
contrast, are adversaries, who seek out our vulnerabilities and adjust
their actions in response to our defenses. This non-random nature of
terrorism complicates risk assessments and requires the development of
new tools.
In spite of these challenges, risk assessment has made considerable
progress in the terrorism area in the past few years. An important
distinction in terrorism risk assessment is between threat,
vulnerabilities, and consequence. When considering threats, we need to
consider the motivation, capabilities, and intent of terrorist groups.
This is probably the hardest part of terrorism risk assessment and
there are no off-the shelf solutions for this task. CREATE researchers
are working together with another university center of excellence--the
Center for the Study of Terrorism and Response to Terrorism (START) at
the University of Maryland--to develop risk analysis models for this
purpose. Assessing vulnerabilities is somewhat easier. The key is to
consider a wide range of threats and to assess the probability that an
attempted terrorist attack is successful. CREATE researchers are using
project risk analysis methods for this purpose. Finally, the assessment
of consequences, given a successful attack, is quite straightforward
and we can use off-the-shelf methods, for example, for modeling the
dispersions of materials, spreading of infectious diseases, and so
forth.
Another distinction is between the various levels of homeland
security decision making. Recent studies by our CREATE researchers
suggest that specific countermeasure decisions, for example regarding
MANPADS countermeasures, can be supported quite well with risk
assessments. At the next level are decisions on how to allocate funds
within a specific threat area or across potential targets. We see some
progress in this area as well. For example, in the past few years
several commercial risk analysis tools have been developed for
assessing risks of infrastructure targets. At the highest decision
making level are questions about how much money to spend on, for
example, radiological and nuclear defenses vs. biological defenses vs.
infrastructure protection. Risk assessment at this level is difficult
and will necessarily involve expert judgments and more qualitative
analysis.
Overall, I am very optimistic that risk assessment can improve our
Nation's decisions to counter terrorism. In other areas it often has
taken years from the initial uses of risk assessment to mature
applications. I believe that we can do better in making risk
assessments useful in the terrorism area, but we also need to be aware
of the many challenges we face.
Mr. Simmons. I thank you very much for those comments.
Our fourth witness is Dr. Henry Willis, who is a policy
researcher with the RAND Corporation, where his research
applies decision, analytical tools and risk analysis to help
decisionmakers choose among competing resource management
strategies or policy actions and options. Examples of his
recent research include assessing risk-based approaches to
allocating homeland security preparedness resources, reviewing
current and proposed countermeasures for protecting U.S.
maritime transportation infrastructure, and assessing personal
protective equipment needs of emergency responders working in a
post-structural collapse environment.
Dr. Willis, welcome. We look forward to hearing your
testimony.
STATEMENT OF DR. HENRY WILLIS, POLICY RESEARCHER, THE RAND
CORPORATION
Mr. Willis. Thank you, Chairman Simmons, Ranking Member
Thompson, Ranking Member Lofgren and distinguished members. I
would like to thank you for giving me the opportunity to speak
with you today about terrorism risk assessment at the
Department of Homeland Security.
Many of my comments are based directly on a recently
released RAND report entitled Estimating Terrorism Risk. I will
make hard copies of this report available to the committee, and
would like to request that the report be made part of the
official record.
Mr. Simmons. Without objection, so ordered.
The information is maintained in the committee file.
Mr. Willis. Over the last 4 years, Congress and the
Department of Homeland Security have made tremendous progress
in maturing homeland security policy. Shortly after September
11, 2001, decisions were dominated by the use of crude
indicators, such as population, which approximated consequences
of terrorist events. Subsequently, policy moved to
vulnerability reduction. And, more recently, Secretary Michael
Chertoff has called on DHS to adopt risk-based decision making.
The next step in this process will be the focus on risk
reduction and cost effectiveness, but the U.S. Government is
currently in the early phases of this stage.
With this as background, there are five recommendations
from our work that are pertinent to today's hearing. First, the
U.S. Government should consistently define terrorism risk in
terms of metrics, like expected annual consequences. Critical
infrastructure risk assessment is too often focused on
potential consequences, either ignoring or under emphasizing
factors that determine threat and vulnerability. Expected
annual consequences take threat vulnerability and potential
consequences into consideration in a rational way. Defining
terrorism risk in terms of all these factors facilitates the
incorporation of risk reduction as the goal of Homeland
Security programs.
Secondly, DHS should seek robust risk estimators that
account for uncertainty about terrorism risk and variance in
citizen values. Given the tremendous uncertainties surrounding
terrorism risk assessment, it is prudent to plan for the range
of plausible futures that may play out. Many different models
exist, and experts disagree on terrorist capabilities and
intentions. Risk assessment should reflect all critical models
and expert judgments. The challenge is to support a single
decision, while still being able to identify how risk is
distributed differently across different outcomes, such as
fatalities or property damage, and also explain how the
decision would change if more emphasis were given to a single
type of outcome or perspective on threats and vulnerabilities.
Third, DHS should use event-based models to assess
terrorism risk. Measuring and tracking levels of terrorism risk
is an important component of homeland security policy. These
data provide insights into how current programs are reducing
risk and when and where new terrorist threats may be emerging.
Only event-based models of terrorism risk provide insight into
how changes in assumptions or actual levels of threat
vulnerability and consequences affect risk levels.
Fourth, relying on event-based models does not mean relying
entirely on a top-down process. It is important to
differentiate strategic risk assessment from risk assessment to
support design or performance assessment or that to support
tactical decisions. Strategic assessments might guide the
distribution of resources that are not reallocated frequently.
Design and performance assessment might be used to optimize or
tune a response to a particular threat or protect a specific
asset. Think of assessment used to reinforce the design of a
nuclear power plant. Tactical assessments might be in response
to intelligence regarding specific threats or events that have
already occurred.
Of course, all are needed. I recommend that a top-down
approach is most practical for strategic risk assessment, and
estimates need not be as detailed as design or tactical risk
assessment. The goal is to distribute resources in roughly the
right places and in correct proportion.
On the other hand, I recommend a bottom-up approach to
support design or tactical decisions. Here, more detailed
models and analysis can be used to authorize spending on
specific projects and justify current programs.
Finally, the U.S. Government should invest resources to
bridge the gap between risk assessment and resource allocation
policies that are cost-effective. The first step in this
process is implementing annual independent risk impact
assessments to evaluate how risk reduction funds have succeeded
in reducing risk. These assessments will provide a feedback
mechanism that will ultimately help increase of risk.
The second step is a capabilities-based assessment of the
Nation's homeland security programs to document the unique
contributions provided by each and ensure balance between the
layered defenses that have been put in place.
I would like to thank you for the opportunities to address
the committee on this important subject, and I look forward to
your questions.
[The statement of Mr. Willis follows:]
Prepared Statement of Henry Willis, Ph.D. \1\
Good afternoon, Mr. Chairman and distinguished Members of this
Committee. I would like to thank you for the opportunity to speak with
you today about terrorism risk assessment at the Department of Homeland
Security (DHS). Many of my comments are based directly on a recently
released RAND Corporation report entitled, ``Estimating Terrorism
Risk,'' which has been made available to Members of the Committee. This
report is part of RAND's program of self-initiated research that is
funded through the independent research and development provisions of
our Federally Funded Research and Development Centers. It is the latest
release by the RAND Center for Terrorism Risk Management Policy, which
was established in 2002 to study terrorism risk management, insurance,
liability, and compensation. I would like to request that this report
be made part of the official record.SPELL
---------------------------------------------------------------------------
\1\ The opinions and conclusions expressed in this testimony are
the author's alone and should not be interpreted as representing those
of RAND or any of the sponsors of its research. This product is part of
the RAND Corporation testimony series. RAND testimonies record
testimony presented by RAND associates to federal, state, or local
legislative committees; government-appointed commissions and panels;
and private review and oversight bodies. The RAND Corporation is a
nonprofit research organization providing objective analysis and
effective solutions that address the challenges facing the public and
private sectors around the world. RAND'S publications do not
necessarily reflect the opinions of its research clients and sponsors.
---------------------------------------------------------------------------
Over the last four years, Congress and the Department of Homeland
Security have made tremendous progress in maturing homeland security
policy. Shortly after September 11, 2001, decisions were dominated by
the use of crude indicators, such as population, which approximated
consequences of terrorist events. Subsequently, policy moved to
vulnerability reduction and more recently, Secretary Michael Chertoff
has called on the DHS to adopt risk-based decisionmaking. The next step
in this process will be to focus on the risk reduction and cost
effectiveness, but the U.S. Government currently is in the early phases
of this stage.
The recently released draft National Infrastructure Protection Plan
(NIPP) reflects this progression by defining an aggressive and
comprehensive approach to risk assessment across sectors that affect
the U.S. economy. As compared to earlier drafts of this document, it
reflects adoption of Secretary Chertoff's guidance to use risk-based
decisionmaking and represents the state of the Department's thinking on
critical infrastructure protection. Specifically, it tries to take a
balanced approach to incorporate: risk assessment; information sharing,
feedback, and training; organizing and partnership with private sector;
resource allocation; and long-range sustainability of protection
efforts. Finally, the draft NIPP describes a framework that follows the
best practices of risk analysis that are outlined in, among other
places, the National Research Council in its foundational reports Risk
Assessment in the Federal Government: Managing the Process (1983) and
subsequently Science and Judgment in Risk Assessment (1994). These best
practices require that risk assessments be: a) analytic, b)
deliberative, and c) practical. For homeland security policy, these
statements have the following translation:
a) Analytic
An analytic process requires addressing all three of the factors
that determine terrorism risk: 1) threat, 2) vulnerability, and 3)
terrorism, and where feasible, to do so quantitatively. Risk
assessments must be repeatable so all parties can replicate, analyze,
and understand them. However, the uncertainty inherent in this problem,
particularly in the terrorist threat, implies that unlike most of our
successful experience with these tools in the past, some new thinking
about all plausible threats, not just the most likely threat, will need
to be taken into account.
b) Deliberative
A deliberative process is necessary because the notion of a cold,
analytic risk assessment is a myth. Values and judgment are part and
parcel to the process and require transparency and a comprehensive
discussion of outcomes. This is the only way to credibly address
tradeoffs between risks to people from risks to property and risks from
a conventional bomb, nuclear attack, biological attack, or even
hurricane or other natural disaster.
c) Practical
Finally, risk assessment must be practical, meaning that data
collection and management requirements must not be untenable and
estimates should not be overly reliant on a single perspective or tool.
This last point is where concerns may arise with the draft NIPP. These
concerns relate more to implementing what is outlined rather than
concerns with the content of the plan itself. Implementation will need
to address natural disasters as well as terrorist threat as the plan is
used. Questions remain about the practicality of implementing risk
analysis and information sharing given limitations in the real world as
to funding, time, and staff available. These issues have not been
ironed out.
With this as background, there are 5 recommendations from our work
that are pertinent to today's hearing.
First, the U.S. Government should consistently define terrorism
risk in terms of metrics like expected annual consequences. Critical
infrastructure risk assessment is too often focused on potential
consequences, either ignoring or under emphasizing factors that
determine threat and vulnerability. Expected annual consequences take
threat, vulnerability and potential consequences into consideration in
a rational way. Defining terrorism risk in terms of all of these
factors facilitates the incorporation of risk reduction as the goal of
homeland security programs.
Second, DHS should seek robust risk estimators that account for
uncertainty about terrorism risk and variance in citizen values. Given
the tremendous uncertainties surrounding terrorism risk assessment, it
is prudent to plan for the range of plausible futures that may play
out. Many different models exist and experts disagree on terrorists'
capabilities and intentions. Risk assessment should reflect all
credible models and expert judgments. The challenge is to support a
single decision, while still being able to identify how risk is
distributed differently across different outcomes, such as fatalities
or property damage, and also explain how the decision would change if
more emphasis were given to a single type of outcome or perspective on
threats and vulnerabilities.
Third, DHS should use event-based models to assess terrorism risk.
Measuring and tracking levels of terrorism risk is an important
component of homeland security policy. These data provide insight into
how current programs are reducing risk and when and where new terrorist
threats may be emerging. Only event-based models of terrorism risk
provide insight into how changes in assumptions or actual levels of
threat, vulnerability, and consequences affect risk levels. There are
many types of event-based models in existence. In our report, we relied
on the Risk Management Systems (RMS) Terrorism Risk Model. This and
other insurance industry models could also be used to support homeland
security policy. The national laboratories have made progress on
detailed models of critical infrastructures and their
interdependencies. Colleagues in academia are applying economic input-
output analysis to understand these same dependencies. Finally, the
NIPP points to RAMCAP, or Risk Assessment Methodology for Critical
Asset Protection, which is based on a foundation for risk analysis
consistent for methods used in reliability analysis and also with the
National Research Council framework.
Fourth, relying on event-based models does not mean relying
entirely on a top down process. It is important to differentiate
strategic risk assessment from risk assessment to support design or
performance assessment or that to support tactical decisions. Strategic
assessments might guide the distribution of resources that are not
reallocated frequently. Design and performance assessment might be used
to optimize or tune a response to a particular threat or protect a
specific asset. Think of assessment used to reinforce the design of a
nuclear power plant. Tactical assessments might be in response to
intelligence regarding specific threats (actionable intelligence) or
events that have already occurred.
Of course all are needed. I recommend that a top-down approach is
most practical for strategic risk assessment; and estimates need not be
as detailed as design or tactical risk assessment. The goal is to
distribute resources in roughly the right place and correct proportion.
On the other hand, I recommend a bottom-up approach to support design
or tactical decisions. Here more detailed models and analysis can be
used to authorize spending on specific projects and justify current
programs.
Strategic risk assessment ultimately needs event-based models.
Until event-based models are more widely used to assess terrorism risk,
density-weighted population is preferred over population as a simple
risk indicator. Density-weighted population is simply a regions
population multiplied by its population density. Our report found this
metric to be reasonably correlated with the distribution of terrorism
risk across the United States, as estimated by event-based models like
the RMS Terrorism Risk Model. In contrast, our results suggest that
population offers a remarkably weak indicator of risk, not much
superior to estimating risk shares at random.
Finally, the U.S. Government should invest resources to bridge the
gap between terrorism risk assessment and resource allocation policies
that are cost effective. As I intimated earlier, Congress and DHS are
only in the position to estimate risks and distribute resources where
the risks are believed to be the largest. Ultimately, the goal should
be to distribute those resources where they most effectively reduce
risk. The first step in this process is implementing annual,
independent risk impact assessments to evaluate how risk reduction
funds have succeeded in reducing risk. These assessments will provide a
feedback mechanism that will ultimately help increase reduction of
risk. Such assessments would benefit the DHS grant programs as well as
border and maritime security programs like US-VISIT, C-TPAT, the MTSA,
and TSA's baggage and passenger screening and profiling programs. The
second step is a capabilities-based assessment of the nation's homeland
security programs to document the unique contribution provided by each
program and ensure appropriate balance to the layered defenses that
have been put in place.
I would like to thank you again for the opportunity to address the
committee on this important subject and I look forward to answering any
questions you may have.
Mr. Simmons. Thank you all very much. I have a couple of
questions that I would like to ask, and then we will go back
and forth in accordance with our regular order.
My first questions are to Ms. Smislova. Critically
important to the success of your mission and your organization
is information sharing, information sharing with the
Intelligence Community to make sure you are getting the
terrorist risk assessments with regard to intents and
capabilities, but also information sharing with those private
sector entities that manage the infrastructure that we are
trying to protect, whether it be nuclear power plants or
bridges or chemical facilities.
It occurs to me that traditionally the Intelligence
Community does not like to share information. I am sorry about
that, but they like secrets. If you really like secrets, you
don't tell anybody your secrets.
Secondly, private sector industries may not be willing to
share information on vulnerabilities for fear that if there is
an incident they may be held financially liable for the
consequences.
So, how are you doing with these twin sets of challenges to
information sharing? What is your status report as of this
moment?
Ms. Smislova. Yes, sir. We in the Intelligence Community
like to just share, as you know, with each other, and we are
accomplishing that through the Office of Intelligence and
Analysis. We believe that through HITRAC, actually putting the
infrastructure protection specialists together with those
Intelligence Community professionals, is the best way to
enhance that relationship and that communication.
Our infrastructure protection specialists through the other
offices in the Office of IP communicate daily with the
infrastructure sectors. They are the ones who have developed
the relationships and the contacts with the infrastructures and
what their situation is on the ground and their daily
information about what is happening in their sector. So every
day when we are working on common goals and common work
projects, the intelligence analyst is working with the
infrastructure protection person. So we actually are receiving
that information that is not traditionally looked at by
intelligence.
Mr. Simmons. And with regard to that interaction or that
activity, what sort of products are you producing and how are
they disseminated?
Ms. Smislova. Yes, sir. We are actually producing a basic
foundation document for every critical infrastructure or key
resource that obviously is expanded beyond the critical
infrastructure of transportation and would include one on
aviation, maritime, railroads, mass transit and highways. So
there are about 24 different products that we are producing.
We are doing these in conjunction with our actual
infrastructure operators and owners, and I think that is what
does make us quite unique. While we have the benefit of
actually all the information that our Intelligence Community
colleagues have about the enemy, we are actually looking at
everything that is available for the U.S. Government in all
different classified areas of what the adversary wants to
accomplish and how.
We also at the same time have a dialogue, because we are
this hybrid of intel professionals and non-intel professionals,
we have a dialogue with the actual infrastructures. So through
the framework of the NIB, we have committed to producing these
foundation documents on what the terrorist threat to that
particular structure or infrastructure might be.
Mr. Simmons. Thank you.
Dr. Winterfeldt, you made an interesting comment. The non-
random nature of terrorism complicates risk assessment and
requires the development of new tools. For a number of years I
served as a military intelligence officer in Vietnam, and we
would collect information and make predictions about enemy
attacks. The military units in responding to those predictions
would take defensive measures, which would be observed by the
other side and when they would see the defensive measures being
taken they would realize it was a tip-off so they wouldn't
conduct the attack. Then our own side would say you guys are
wrong again.
It occurs to me in a free and open society, such as ours,
where we discuss our vulnerabilities and our efforts to protect
our infrastructure, that the opposition is fully aware of those
efforts and can adjust for that.
How do we account for that in our risk assessment?
Mr. von Winterfeldt. Thank you very much. That was a very
interesting question, and something that we are grappling with
in many ways.
We actually have some of our team members who are looking
at this from a red team and blue team perspective. They are
looking at it from a game theoretic perspective. Actually, I
see the greatest hope in sequential games, very much playing
out in a modeling form the situation you described, which can
even lead you in some cases to protect information about
defensive measures, or, potentially, I hate to say this,
provide misleading information about protective measures.
I will just give you one example. Should we always say that
we are doing 10 percent or 5 percent inspections of our cargo?
Well, maybe we can do 10 percent and then claim we use 50
percent. You remember the case of the cameras at the
intersections, half of which never worked. So there are a lot
of interesting issues.
We certainly have no silver bullet nor simple answer to
that. But that is exactly the kind of topics we are studying as
we are working at CREATE.
Mr. Simmons. Thank you. I see my time has run out. Ms.
Lofgren.
Ms. Lofgren. Thank you. I am glad to have Ms. Smislova
here, because I have a continuing interest, as I mentioned in
my opening statement, in the National Asset Database. I will
just express some frustration. I am not alone in this
frustration. But this has now gone on for a couple of years,
and we have had several classified discussions, and I remember
the first time it was a bipartisan group and informal, and I
asked to see the database for my county because I know it well
and the members from other parts of the country did the same,
and all of us were struck by how preposterous the list was. I
recently received an updated list, and it was still
preposterous.
So my question is, when do you think this National Asset
Database will be complete, at least in its--I realize it will
be updated, but delivered? When do you think that delivery will
be to the Congress?
Ms. Smislova. I am sorry, ma'am. I actually don't know the
answer to that particular question. What I do know is that the
National Asset Database is intended to catalogue all of the
assets in this enormous country of ours. I know from notes I
took during your opening statement that your goal here is to
conclude what to protect first and why, and that is actually
the issue that we are trying to start with in HITRAC.
From my perspective as the senior intelligence person
assigned to HITRAC, that is the focus of what we have put our
efforts towards, trying to get a better understanding of this
particular enemy, this adversary who we know wants to attack us
here in the United States, what does he want to attack and how?
By using information that is available through the National
Asset Database, we have been able to crosswalk and narrow some
things down. So we try to determine what does the adversary
want to accomplish, what are his goals, and then how can he
accomplish this. And because we don't have specific data that
he wants to hit this building or another building or a specific
mass transit fleet or anything that granular, we try to
crosswalk it and say these are the things we think we need to
protect first and why.
But I will bring your other question back for the record,
ma'am.
Ms. Lofgren. I appreciate that. Along with that, and if you
don't know today, that is fine, but if you can get back I would
appreciate it. Part of the problem I discovered was--I met not
only with DHS staff, but also with--we all go home every week--
with people in local government, with the State officials,
trying to find out what was happening from their point of view,
and learned in doing so that there had been an asset limit on
how many assets could be reported, which is a preposterous way
to proceed because in Santa Clara County, for example, it is a
county of just shy of 2 million people. It is Silicone Valley.
There are many, many assets. To be limited to 18 in Santa Clara
and 18 in Shasta County, where you might be hard pressed to
come up with 18, is ridiculous. So I am hoping I can get
information on whether that that policy has been changed as we
urged that it be.
Let me ask a question for Dr. von Winterfeldt. We are being
asked, and we agree, that Homeland Security dollars should be
spent in a strategic way to protect our assets best, and I
think all of us agreed with the Secretary that it automatically
ought to be risk-based, it shouldn't be some formula like an
entitlement program, that is not the way to do. But it seems to
me central to that effort is the development of this National
Asset Database and the database is not complete, it doesn't
prioritize critical infrastructure assets across the 17 sectors
identified in HSPD-7.
In your view, how significant an obstacle is the failure to
complete this database to meaningful terrorism risk assessment
at the Department?
Mr. von Winterfeldt. Well, I believe that it will be very
useful to have that database as a start. Let me also say where
I see this heading down the road, and that is to do a good job
on critical infrastructures with the database, or even with
part of the database, is you have to work yourself from the
specific infrastructure assets up and roll it up. You can't do
a risk analysis on the high level, not even at the county
level, not even at the State level, unless you know what is
going on with the particular assets and what you can do with
it.
So CREATE, for example, is now engaging with the California
Department of Homeland Security to look from the bottom-up at
the assets and the infrastructures that California has
identified as important and start to build a risk analysis at
that level and going up. Of course, the ultimately comparison
between the States or even the urban initiatives in the urban
areas can only be done if you have a complete set of assets and
infrastructure elements.
Ms. Lofgren. My time has expired, so I will save my further
questions for the second round.
Mr. Simmons. The gentleman from California, Mr. Lungren.
Mr. Lungren. Thank you very much, and I understand what Ms.
Lofgren says when she compares her county to Shasta County, but
I do hope that Shasta Dam is on that list of critical
infrastructures and so is the headwaters of the Sacramento
River, which provides about one-third of the water for our
whole state.
Ms. Lofgren. I love Shasta County. Let me clarify that. I
think Shasta County is a wonderful place.
Mr. Lungren. I keep calling it HITRAC, but you want to call
it HITRAC. See, when you are an English major, you divide
things into proper syllables, and HITRAC sounds better than
HITRAC.
As I understand, HITRAC or HITRAC is a point of contact for
summary and trend analysis for suspicious activity reporting,
which I guess we call SARS, even though that has other
indications these days, and they are supposed to be sent in by
public and private individuals at local levels to provide
warning signs of potential terrorist attack.
How effective is this program? How much is it really on? To
put it another way, if I happen to be a manager of an asset in
northern California, private or public, how well am I informed
of these suspicious activity reports? How do you see that
reflected in what you receive in your shop?
Ms. Smislova. The suspicious activity reports typically are
coming from industry through the Information Sharing Advisory
Councils, the ISACs, or directly to our operations center.
Sometimes we get suspicious activity reporting just from
American citizens. They will call them in and they are called
Patriot reports.
Mr. Lungren. My question is, how do I know that? How do
people know that?
Ms. Smislova. We distribute, disseminate, our products back
again through that same vehicle, through the ISACs, through the
Homeland Security advisers. We do send our reports to the
JTTFs. That is all distributed.
Mr. Lungren. I guess my question is, how comfortable are
you in the belief that there is a high level of understanding
of your activity and the need to report these things?
Ms. Smislova. It is spotty, sir. Some industries we have
been able to dialogue with and we have been able to discuss
with them what we are trying to accomplish with the suspicious
activity reporting, and some industries or entities we have
not. It is easier at this point to have outreached to ones that
are more organized. So for example, the electrical power grid,
we have a dialogue with the people that run that particular
infrastructure.
It is more difficult with the shopping malls of America. We
are trying to tailor our products to make sense to those that
are protecting the different critical infrastructure, but we do
realize that each group that runs the infrastructure is
diverse, and that is again where I would get back to the
requirement for the Department to outreach and dialogue with
the individuals.
Mr. Lungren. Let me ask you this question: This weekend
there are literally going to be millions of people attending
football games at major colleges, universities and in the NFL.
Can you tell me from what you know, are people who run those
operations cooperating with the Department of Homeland Security
such that you are getting reports of any suspicious activity of
this nature?
Ms. Smislova. We actually do deal with the commercial
services sector. I also sent a HITRAC employee to brief the
security people that do the college football, all the college
football security thing, have been briefed by us on what to
look for or what we believe would be suspicious activity that
might indicate an attack was pending.
Mr. Lungren. You have told them that you have got this. Do
you get reports from them?
Ms. Smislova. We get reports from the commercial services
sector, yes.
Mr. Lungren. I guess I still have a little bit of time. For
the whole panel, this seems to be a crucial part of protecting
critical infrastructure, making owners and operators aware of
what to look for in terms of suspicious activity. For the other
panelists, what is your sense of the awareness of this program
and do you have any recommendations on what we would do to make
it more effective?
Ms. Wormuth. I certainly can't speak to the public or
industry's awareness of HITRAC in particular.
Mr. Lungren. That is not what I am talking about. I
appreciate listening to all of what you have to say, and it
sounds good in theory. But if it breaks down, if all we are
doing is talking about it and no one knows what information
needs to get to us for this--I am just trying to find out if
any of you have a sense of how broadly understood this is, how
much is this actually working? Are we sitting here talking
theoretically about what would sound like a great idea, but you
can't analyze anything unless you get data to analyze?
Ms. Wormuth. Congressman, I would say I am aware of at
least New York City, and I would suspect some other major
cities, have programs that are focused on going out and talking
to businesses, industry owners, and again it sounds like very
similar to what Ms. Smislova was speaking to, which is talking
to those folks in the private sector about what to look for and
what type of activity to report. I believe the program in New
York City is called Hercules. My memory may be wrong, but some
major cities certainly have programs designed to try to make
the private sector aware and alert them to either report in to
city governments or the State Homeland Security managers.
Mr. von Winterfeldt. At CREATE we work a lot with local
government officials, and I know there are many mechanisms for
them to report at the local level. I don't know how the
reporting works from there to the Department of Homeland
Security or back, so I can't comment on that. But I do believe
that the local level works well.
Just recently in L.A. there was a discovery of two events,
a discovery of two suspicious females that were taking
pictures. They were pursued and eventually apprehended, and it
turned out to be a false alarm. So some things seem to be
working at the local level. I am not sure how the national and
local level are communicating.
Mr. Lungren. Thank you.
Mr. Simmons. The gentleman from Pennsylvania, Mr. Dent.
Mr. Dent. Thank you, Mr. Chairman. Ms. Smislova, I get a
lot of comments from my folks back home in Pennsylvania, from
the Homeland Security folks and others at the local level, and
my main question to you is this: Are any local Homeland
Security agencies detailed to HITRAC, or HITRAC, whatever the
case may be?
Ms. Smislova. Not at this time, no, sir.
Mr. Dent. Regarding your evaluation of risk, what sort of
input do you get from State Homeland Security or local first
responders, I guess you don't get any, in making these
evaluations? Do you get any input from them?
Ms. Smislova. Yes, sir, we are. We are trying to outreach
to different customer sets as we are developing them, and we
also are briefing some States and first responders and then
incorporating their comments or their suggestions.
Mr. Dent. So I guess the broader question is what do you
see as the role of these local groups in helping determine
threat vulnerability and consequences?
Ms. Smislova. We see the role as large and expanding. We
have connectivity with every State and we talk to every State.
We hope that would be our goal, to expand our production
efforts to deal with at least all the major metropolitan areas.
Mr. Dent. I guess my question is, my main comment is, these
folks at the State and local level really want to be I think a
greater part of this process. Sometimes I feel as if the
information they receive is not helpful, that they just don't
have the ability to process what gets sent down to them from
Washington. This information sharing, something gets lost
between the Federal and State and local levels, and they really
want to be involved more than they have been.
I guess the question would be, how do you go about
disseminating risk evaluations to local communities that may in
fact be vulnerable to attack, and how do you ensure that risk
assessments are timely, relevant and helpful to local
communities that must ultimately be forced to respond to any
such attacks? They worry about the timeliness and relevance of
the information they receive. How do you address that?
Ms. Smislova. Again, our goal is to interact more often
with the State and the local governments. We do have people
from the State and local entities deployed in our operations
center. We deal with them on a regular basis. We travel out to
States and local places. I have two people today in Chicago
discussing some risk assessments and plans for additional
products. So that is just how we have begun with our work.
Mr. Dent. I have raised these same questions to the folks
from the ASSOC and elsewhere, and anybody else feel free to
chime in if you have any points on this issue. I would be glad
to hear it.
Mr. Willis. I would like to say that I agree with the
assertions that have been made that local intelligence is a
very important part of understanding threat. I think it also
points to one of the observations we found in our report, that
risk assessment can't be done only from the top-down, but also
sometimes from the bottom-up.
My colleague, Dr. Winterfeldt, talked about work they are
doing in California that is very much bottom-up where a lot of
the information is. So there is a need to look at doing these
risk assessments from both directions.
Mr. Dent. No further questions. I yield back.
Mr. Simmons. I thank the gentleman. We are going to go a
second round, if that is all right.
Let me pick up where my colleague left off on the issue of
top-down versus bottom-up. First of all, Dr. Willis, you said
in your statement that tremendous progress has been made in
maturing Homeland Security policy, and I would agree with that,
even though I certainly understand my colleagues' frustration
when miniature golf appears on a list somewhere. But I would
hope that is an anomaly and not characteristic. I think
progress has been made.
I think it is an impossible task to secure everything from
everybody. If you try to do that, you will certainly fail. So
you have to prioritize.
I think information sharing is very difficult to do, but I
think people at a local level are somewhat aware, in some cases
more than somewhat aware, of what we are attempting to
accomplish.
So the challenge to me really is have we put in place a
system that is sophisticated enough that not only does
information come down from the top, presumably sensitive
information or analytical products that the local community
does not have the capacity to produce, but does the system
allow local information and observation to go back up? Do we
have a dynamic or a virtual system, in other words? And do the
local folks have the tools and the networks to interact with
the State and the Federal folks? Are we there yet or are we
not?
Mr. Willis. That is a very good question. I will try to
comment first broadly on where I think these tools and
approaching networks are for risk analysis, and then also in
terms of threat and passing threat information. I have not
studied that as much but will check back with my colleagues at
RAND.
In terms of risk analysis, what I have seen in all the
States is organizations to try to link regionally to the State
and make connections. In terms of tools, recently the
Department of Homeland Security has released the draft National
Infrastructure Protection Plan. In my written testimony I have
included a few comments about that. I will try to summarize a
few of the key points because I think it highlights some of the
important points about the tools that are starting to be
provided.
I would like to say, acknowledge, that RAND Corporation has
been providing support to the Department of Homeland Security
in developing that plan. I myself have not personally been
involved in that but have been asked to comment on it.
The key points I make about the NIPP is that it is
comprehensive and it addresses all sectors. It is realistic in
that it points out that you can't treat these sectors with a
cookie cutter approach. Water is different than
telecommunications, et cetera.
Where there might be--it is also laying out a common
framework for doing risk analysis. This will help provide some
structure to the local people who would be doing the analysis
and also aid in comparison across assessments that come. Where
there might be concerns is on implementation, because this is a
very complex and resource-intensive approach, and that is where
I would go back to my comments that we need to look for ways to
trim the tree, we can't wait until we get all the assessments
in to respond, and a combination of a bottom-up and top-down
approach is necessary.
Mr. Simmons. In the brief time I have remaining for Ms.
Wormuth, you made comments about National Intelligence
Estimates and you made comments about a National Risk
Assessment. The National Intelligence Estimate on Iraq's WMD of
October 2002 was wrong, inadequate information, in my opinion,
analysis based on inadequate information. So now we shift
quickly to National Risk Assessment. Again, we don't know what
we don't know.
Is this an exercise that is going to save the country, or
is this an exercise that we engage in because we sort of know
how to do it so we are going to do it?
Ms. Wormuth. Thank you, Mr. Chairman. I knew when I made a
comparison to a National Intelligence Estimate that I was
opening myself up into a risky area, because not only can NIEs
be wrong, they are also often viewed as relatively watered down
and sort of lowest common denominator products.
That said, in my opinion, I think the only alternative to
trying to come up with some sort of strategic level homeland
security risk assessment is to not use a risk-based approach at
all, which to me seems more perilous than trying to go through
a structured risk assessment process and perhaps getting it
only 80 percent right.
So I would argue that yes, there are dangers, but I think
that there is not a better alternative. I think two broad
advantages to risk assessments are that they will force
policymakers to go through the myriad sets of threats and
vulnerabilities in a structured way, and it really allows you
to unpack some very difficult problems, as opposed to what I
think many have observed is a tendency sometimes to try and
allocate our resources to essentially the last war or sort of
the new sexy thing.
Lots of money went towards aviation security because 9/11
was essentially an aviation-based event. Biological threats are
very much in the news and a lot of resources are spent there,
although for very good reasons.
One other thing I would emphasize is that I think while
certainly factoring in very specific intelligence and looking
at motivations and looking at intentions is very important, I
also think there is a lot of wisdom to taking perhaps what I
would call more of a capabilities-based approach, again,
perhaps coming out of my DOD background. But to a certain
extent, I think there is some utility at looking at threats
from the perspective of simply what is available in terms of
different weapons systems, in terms of different delivery
systems, to somewhat more generic terrorist groups that are
fairly well resourced, and at least thinking very broadly,
because--I think because it is so difficult once you start
getting into intentions.
Many, many people weren't even particularly aware of al-
Qa'ida before 9/11. So I think there are definitely challenges
in trying to do a strategic level assessment, but to me it is
very much still--the benefits far outweigh the risks.
Mr. Simmons. Thank you for that answer.
Ms. Lofgren.
Ms. Lofgren. I want to get back to the National Asset
Database, because I am hoping we can make some progress on it.
Before I do, I just want to say I actually did check with
people in the know and found out that there was no reason why
the miniature golf course was on the list and that the people
of San Jose should not worry about playing miniature golf. It
could be dangerous in terms of the balls hitting people, but
there is no other apparent threat.
In looking at how this has been put together, I think the
chairman is right, we need to look at the systems in place to
see whether they are going to yield information that is
valuable. One of the things that became apparent to me was that
we had passed really local police departments to come up with
the list of critical infrastructure, and they are doing a
terrific job, their very best. This is not critical of their
efforts, but there are certain things that they are just not in
a position to know; for example, telecommunications physical
infrastructure or certain cybersecurity issues. It is just not
within the purview of the police department for the most part.
There were some things actually that the fire department
might know that the police department would not know, and they
were not included, and the health people were not included, and
the private sector people were not included.
So I am wondering if there has been a change in the
structure of who is included so that we can make sure that the
critical infrastructure, all of it, is actually in this
database.
Does anyone know the answer to that?
Ms. Smislova. Ma'am, we would be happy to come back and
give you and your staff a briefing on the NADB. We can arrange
that for you.
Ms. Lofgren. But you don't know the answer to that?
Ms. Smislova. No, ma'am, I do not.
Ms. Lofgren. Maybe Dr. Winterfeldt would know this. At one
point the Department asked the--I believe it was the sheriff's
department, it might have been the police department, in the
City of Los Angeles to lead a pilot project, to change how the
database, the National Asset Database is put together. Are you
familiar with that?
Mr. von Winterfeldt. No, I am not specifically familiar
with that.
Ms. Lofgren. I would like to know--
Ms. Smislova. Is that Project Archangel or Constellation?
Ms. Lofgren. Archangel.
Ms. Smislova. Yes, ma'am, I was actually briefed on that
today by the Los Angeles Police Department, who was visiting.
It is not a National Asset Database, but it is a way to map the
infrastructure of Los Angeles, and that actually is being done
by the police department in conjunction with the Department of
Homeland Security.
Again, it is not a system to prioritize, but rather to
actually come up with a map so that when information is
received, intelligence information, and it says something
specific, that you are able to more quickly and rapidly come up
with a facility list.
Ms. Lofgren. That is different than the briefing I got. So
perhaps it is more. But it seems to me that there needs to be
some strategy. When I saw the list, there is shopping centers
and there is a check cashing office in L.A. and stuff like
that. I thought why would this stuff be there?
I can see if you received a threat that had something to do
with shopping centers, you would want to know where all the
shopping centers are. That is a good thing to know. But since
our risk assessment really relates to our vulnerabilities and
the consequences of activities, if you don't have a different
list for--if you want to take down the water supply of southern
California, there is three or four different ways you can do
it, none of which are on the list.
So it seems to me that there needs to be--and I haven't
seen it yet in the Department--any kind of a strategy for what
would have a cascading both economic and also physical harm
consequence that is connected with infrastructure so that as
threats come in, we can lay those threats across what is a
critical--
Ms. Smislova. Right. We do, ma'am, work with the sector
specific agencies to identify their top priority places. We
have several of those sectors actually completed. That is a
different effort, ma'am, yes. We can come backSec.
Ms. Lofgren. It is very mysterious, because we were told
one thing about this database in the Congress and now
apparently it has morphed into something else. So long as the
job is getting done, I assume that is fine, but we have to
really become convinced that the job has been done, and it is a
long time since 9/11. We have wasted a lot of time, and I have
some real concerns that we are not yet really ready and where
we should be. So I will look forward to getting a further
briefing on this.
I see that the red light is on, and I yield back, Mr.
Chairman.
Mr. Simmons. The gentleman from California, Mr. Lungren.
Mr. Lungren. Thank you very much, Mr. Chairman. In your
testimony, I notice you talk about the formal challenges
involved in risk assessment in the area of terrorism, but you
say despite these formal challenges, it is absolutely worth the
time and effort to develop robust homeland security risk
assessments that can guide our planning and policy development.
Then, Dr. Winterfeldt, you talk about how successful risk
assessments have been in medicine, the business environment,
industrial safety, natural disasters, how it is relatively new
in the area of terrorism, but in spite of these challenges,
risk assessments have made considerable progress in the
terrorism area in the past few years. I would therefore say you
indicate it is a tool that is automatically to be utilized at
the present time.
Here is my question: It is easy for us once we have
determined what the risks are and what the most vulnerable
targets are, if they are publicly owned, for us to command
certain things to be done or for us to put as much money,
government money as we can to it. But within the universe of
critical infrastructure, a lot of stuff is owned by the private
sector.
A couple of years ago, Congress felt it necessary to pass
TRIA, a back-up to the regular insurance program. We are
considering now to reauthorize it. I happen to be one of the
people who thinks it is necessary given the still existing
uncertainties in a terrorist scenario for the private sector.
But one of our obligations here is to utilize something like
try to see what the insurance industry, how the insurance
industry plays in all of this, so that perhaps instead of us
regulating something or mandating certain best practices or
providing government incentives by way of tax policy, the
private sector makes some adjustments in terms of what
insurance companies are supposed to do, risk assessment.
How satisfied are you that the kind of information we have
talked about that goes to DHS and is supposed to help drive
policy, that that information is available such that private
sector owners and the insurance industry can make the kind of
judgments that will drive us towards the best business
practices for a security purpose in light of what the true
risks are out there?
Mr. von Winterfeldt. Perhaps I could give it a start.
Actually CREATE put together a conference just a few weeks ago
on the reissuing of TRIA and we are fairly familiar with these
issues, together with RAND by the way.
It is a real difficult question of how you transfer the
risk issues from the public back to the private sector. There
ought to be self-interest in the private sector to protect
themselves against terrorist events and I do not see it
happening right now. This may be lack of information, it may be
that they do not have the money or the capital to do it so they
are looking to terrorism insurance. I am not sure that is a
right solution either. The insurance only covers the asset when
an event occurs. It does not do much in terms of protecting the
asset against terrorist attacks, although properly implemented
with insurance breaks and things like that it ought to do that.
Mr. Lungren. You have fluctuating premiums depending on
what you are doing with respect to security. At the same time I
could construct an idea of a hotel, for instance, which we know
are targets of terrorists, American-identified hotels. And the
more that we protect public sector assets it seems to me if I
am an terrorist, I look at the softer targets of the private
sector. We could drive the hotel industry in such a direction
that they basically make all of their hotels look like
fortresses and moats and destroy the industry because no one
wants to go to a moat--a fortress for a vacation.
And what I was trying to figure out is how we establish a
balance. And if we do not have the information available, it is
even more difficult for us to get to the point as to where we
want to go. And so my question really goes to the issue of are
we in your judgment--have you seen, are we in the government
when we gather this information, are we doing a good enough job
of getting that out to the private sector, including the
insurance industry, such that they can start to make rational
judgments as to where they want to go and have some guideposts
and where we can sort of push people to best business
practices?
Mr. von Winterfeldt. Very quickly and then I will pass it
on to my colleague to my right. The insurance industry
increasingly is turning to private companies to do these risk
assessments for them. There are several companies, one is the
one that Dr. Willis worked with, that do the risk assessments
before the assets. So I do not see it necessarily happening
only through information exchange between the Department and
the private assets, but they are particularly interested in
finding out which assets are threatened and make decisions
about risk and premiums and insurance and things like that.
Let me stop right here and ask Ms. Wormuth.
Ms. Wormuth. Congressman, certainly the fine points of the
issues related to the insurance industry are well outside of my
expertise. I would say one thing. I do think that--two things,
I think Dr. Winterfeldt noted that there should be some self-
interest on the part of industry to themselves take on some of
the preventive measures. Because, of course, if they are
attacked and their operations are essentially grounded for a
period of time, that is not in their own interests.
But I think part of the challenge, we would be helped I
think in convincing our colleagues in industry of the types of
steps they need to be taking. If we could again walk them
through in a logical, structured way, here is how we have come
to this assessment and this is why--and I am just posing this
as a hypothetical, which is why, chemical industry, we believe
that you all do pose a high risk versus another particular
industry which may be a lesser risk and we would like you all
to consider these types of measures.
I think we would be able to better make that case to
partners in industry if again we had a structured, defensible
strategic assessment that we could walk them through in broad
terms to help them see how they compared to other folks in
industry.
Mr. Lungren. One of the concerns I have is how do we make
sure that the information flows in both directions? How do we
encourage industry and other people to get information to DHS
and how do we encourage DHS and government entities to share
enough of the analysis and information that people understand
in an intelligent way what the risks are so that it will be in
their self-interest to do that?
Because as the chairman has suggested, we have a culture in
government which is not to share information. Give me the
information and I can trust myself, but you are not going to
get any of that out there. And I think it is a continuing
problem because of the nature of the different functions we
have. But in this area, if all we do on the government side is
believe that government action is the sole universe in which we
can deal with the threat, we are going to short ourselves from
so much more activity that could be done of self-help and
ultimately protecting us collectively, and I am just trying to
raise these issues and look for as much information as I can.
Ms. Wormuth. Sir, I take your point completely and I am
sure Ms. Smislova can speak to it in more detail than I can.
But in my experience working with organizations that work with
DHS, I have actually been pleasantly surprised in many
instances at how much DHS is doing to try to reach out to
industry and my outside observation is that there has been a
lot of emphasis on that. They are working with folks through
the HITRACs. I know that other elements of DHS are trying to
work with State and local and private sector organizations and
I think certainly that framework is not fully in place but my
experience has been that DHS is very much trying to seek input
from the private sector and from the public.
Mr. Lungren. Thank you.
Mr. Simmons. Please.
Mr. Willis. May I add one point on that?
Mr. Simmons. Please.
Mr. Willis. I agree with Representative Lungren that these
are very important questions you are raising and since this
panel is about risk analysis, I would say that I think risk
analysis can answer many of these questions. In fact, RAND,
through the Center for Terrorism Risk Management Policy, has
been working with Risk Management Solutions as one of the
insurance modeling groups that does some of this, and we would
be happy to share with you some of the work that we have been
doing to try to share that information. The information sharing
actually goes both ways. I have been working with Risk
Management Solutions and the Department of Homeland Security
HITRAC to see how the type of modeling used in the private
sector can inform DHS's risk assessment. Thank you.
Mr. Simmons. Do any members of the panel have any
additional questions they would like to ask?
Any additional comments that the panel of witnesses would
like to offer for the good of the order. Doctor? Anybody?
Mr. von Winterfeldt. I just wanted to make one comment. It
is very important, and you raise very important issues. In many
agencies that started risk assessment, starting with the
Nuclear Regulatory Commission in the 1970s, this is when it was
new stuff. It took years for risk assessment to mature to,
filter through all parts of the agencies and to become a truly
useful tool. So maybe we are hoping for too much. Maybe we are
expecting for things to come too quickly. We are pushing. But I
am certainly hopeful that risk assessment will be useful and
used down the road in the Department more and more effectively.
Mr. Simmons. Anybody else have a final comment they would
like to make?
Ms. Smislova. Only to point out that Secretary Chertoff has
appointed a new Assistant Secretary for the Private Sector as
one of his developments under the reorganization and hopefully
that will assist us in enhancing our outreach as a department
to the private sector.
Mr. Simmons. Thank you all very much. I appreciate your
coming here and your testimony. If members of the committee
have additional questions for the witnesses, we will ask you to
respond to those in writing and the hearing record will be held
open for 10 days.
I would also like to conclude with an observation. On the
week of September 11th I traveled to New York on a Friday with
the President, and I represent the State of Connecticut. We
lost people on 9/11. My daughter actually was living in New
York at the time and never returned back to her apartment
because of the damage of 9/11.
As I stood there and looked at the devastation I was
overwhelmed by the immense scope of it. Standing and looking at
the burning remains of the World Trade Center, even as a
Vietnam veteran, I would say it was probably one of the most
devastating things I ever experienced. And then as we went back
to the airport, took off and flew back to Washington we circled
once and came over the top of the New York City and from that
perspective the World Trade Center was simply a very small spot
with a very small wisp of smoke coming up from it and the great
expanse of New York, New Jersey and Long Island as well as
Westchester County and Fairfield County, Connecticut seemed
like an immense piece of property or real estate.
I guess what came across in that was how truly huge our
country really is. What an extraordinary set of infrastructure
we have and how difficult it is to refine our risk assessment
to the point where we can cover it successfully. It is not
easy. And I think, Doctor, you put your finger on it. This is
going to take time. Now we as Americans are impatient people.
We like our food in 15 minutes or less. We like everything to
be very quick. But working on this problem is not easy to do.
So we thank you for the expertise that you bring to the
table and wish you all the best as we pursue this issue into
the future.
Without objection, the subcommittee stands adjourned.
[Whereupon, at 4:30 p.m., the subcommittee was adjourned.]