[Senate Hearing 110-452]
[From the U.S. Government Publishing Office]


                                                       S. Hrg. 110-452
 
                    NOMINATION OF DR. DONALD M. KERR 
                   TO BE PRINCIPAL DEPUTY DIRECTOR OF 
                         NATIONAL INTELLIGENCE 

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

                                HEARING

                               BEFORE THE

                    SELECT COMMITTEE ON INTELLIGENCE

                                 OF THE

                          UNITED STATES SENATE

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             AUGUST 1, 2007

                               __________

      Printed for the use of the Select Committee on Intelligence


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                    SELECT COMMITTEE ON INTELLIGENCE

           [Established by S. Res. 400, 94th Cong., 2d Sess.]
            JOHN D. ROCKEFELLER IV, West Virginia, Chairman
               CHRISTOPHER BOND, Missouri, Vice Chairman
DIANNE FEINSTEIN, California         JOHN WARNER, Virginia
RON WYDEN, Oregon                    CHUCK HAGEL, Nebraska
EVAN BAYH, Indiana                   SAXBY CHAMBLISS, Georgia
BARBARA A. MIKULSKI, Maryland        ORRIN G. HATCH, Utah
RUSSELL D. FEINGOLD, Wisconsin       OLYMPIA J. SNOWE, Maine
BILL NELSON, Florida                 RICHARD BURR, North Carolina
SHELDON WHITEHOUSE, Rhode Island
                     HARRY REID, Nevada, Ex Officio
                 MITCH McCONNELL, Kentucky, Ex Officio
                    CARL LEVIN, Michigan, Ex Officio
                    JOHN McCAIN, Arizona, Ex Officio
                              ----------                              
                   Andrew W. Johnson, Staff Director
                Louis B. Tucker, Minority Staff Director
                    Kathleen P. McGhee, Chief Clerk























                                CONTENTS

                              ----------                              

                             August 1, 2007

                                                                   Page
Hearing held in Washington, DC, August 1, 2007
Statement of:
    Bond, Hon. Christopher S., Vice Chairman, a U.S. Senator from 
      Missouri...................................................     1
    Mikulski, Hon. Barbara, a U.S. Senator from Maryland.........    20
    Bingaman, Hon. Jeff, a U.S. Senator from New Mexico..........     2
    Warner, Hon. John, a U.S. Senator from Virginia..............     4
    Kerr, Dr. Donald M., Nominee for the position of Principal 
      Deputy Director for National Intelligence..................     6

Supplemental Material:
    Senate Select Committee on Intelligence Questionnaire for 
      completion by Presidential Nominees........................    28
    Pre-Hearing Questions for Donald M. Kerr.....................    54
    Glynn, Marilyn L.; General Counsel, Office of Government 
      Ethics Leter to The Honorable John D. Rockefeller, IV......    96
    Financial Disclosure Report of Donald M. Kerr................   101
    Letter to Robert Cusick, Director, Office of Government 
      Ethics from Corin R. Stone, Principal Deputy General 
      Counsel, Office of the Director of National Intelligence...    97
    Letter to Corin R. Stone, Designated Agency Ethnics Official, 
      Office of the Director of National Intelligence from Donald 
      M. Kerr....................................................   100


                 NOMINATION OF DR. DONALD M. KERR TO BE
                      PRINCIPAL DEPUTY DIRECTOR OF
                        NATIONAL INTELLIGENCE

                              ----------                              


                             AUGUST 1, 2007

                               U.S. Senate,
           Senate Select Committee on Intelligence,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:37 p.m., in 
room SH-216, Hart Senate Office Building, the Honorable 
Christopher Bond (Vice Chairman of the Committee) presiding.
    Present: Senators Bond, Mikulski, Feingold, Nelson of 
Florida, Whitehouse, Chambliss, Snowe, and Warner.
    Also present: Senator Bingaman.

OPENING STATEMENT OF HON. CHRISTOPHER S. BOND, VICE CHAIRMAN, A 
                   U.S. SENATOR FROM MISSOURI

    Vice Chairman Bond. This hearing will come to order. 
Chairman Rockefeller regrettably is unable to be here today due 
to an unavoidable conflict and he has asked me to preside over 
the hearing, pursuant to the Committee rules and practice.
    I ask unanimous consent that any opening statements that 
Members may have or that the witness may have may be included 
in the record in full. Hearing no objection, it is so ordered.
    Dr. Kerr, I welcome you today for the Committee's hearing 
on your nomination to be the next Principal Deputy Director of 
National Intelligence. I appreciate having an opportunity to 
meet your wife Alison and welcome her and other family members.
    As we know, in May 2006, General Hayden resigned this 
position to become Director of the Central Intelligence Agency, 
and since then, in spite of the importance of this Principal 
Deputy position for the IC, there had not been an urgency to 
fill this vacancy permanently. Earlier this year the Committee 
held a hearing on the nomination of Admiral Mike McConnell to 
be DNI. At that time we asked if he would make finding a new 
Principal Deputy a priority. We were assured it would be, and 
Director McConnell has been good to his word. I'm pleased we're 
finally able to consider Dr. Kerr to fill this key post.
    While a lot of focus is necessarily placed on the DNI, the 
role of Principal Deputy is no less essential to the success of 
the intelligence community and to its continued transformation. 
I expect that, should Dr. Kerr be confirmed by the Senate, his 
background in technology and science can be extremely useful.
    He comes before the Committee having spent most of his 
professional career in Government service. He has served in 
various positions at Los Alamos National Laboratory and at the 
Department of Energy. More recently, he was Assistant Director 
of the Laboratory Division at the FBI, and then the Deputy 
Director for Science and Technology at the CIA. For the past 2 
years, he has served as Director of the National Reconnaissance 
Office, which unfortunately is one of the more troubled and 
poorly performing agencies within the intelligence community. 
In addition to his Government service, Dr. Kerr has held 
several executive management positions in the private sector.
    These experiences collectively and separately give Dr. Kerr 
a unique perspective in assessing the technology and science 
challenges lying ahead for the intel community.
    I would say that one of the most important things he can do 
is use the best science and technology to engineer an effective 
structure in the intelligence community. We gave a massive 
charge to the DNI and did not give him the tools to accomplish 
that task. So we look to the new Principal Deputy and the 
Director to give us a road map for next year on how we can 
assure that the community operates as we expected but 
regrettably did not give it the tools to do.
    There are going to be some questions about programmatic 
decisions Dr. Kerr made as a Director of the NRO, some we 
consider missteps at the NRO prior to his tenure. That 
testimony will have to be taken in closed session. But I must 
say in open forum that there had been a disturbing lack of 
accountability at the NRO for actions that have resulted in the 
loss to the taxpayers of, inappropriately enough, an 
astronomical amount of dollars. The Committee and the full 
Senate will have to understand the reasons for this lack of 
accountability, and we look forward to pursuing this in closed 
session.
    Before concluding, I add a very special word of thanks for 
Lieutenant General Ronald Burgess, who has filled in as the 
Acting Principal Deputy for much of the past year. We are 
grateful for his service and applaud his continued dedication 
to the intelligence community.
    With that, we are pleased to be joined by two distinguished 
Members of the Senate who are at the table with Dr. Kerr, I 
assume for the purposes of commenting about Dr. Kerr. And I 
start over here with a Member of the Committee, Senator Warner.
    Senator Warner. Mr. Chairman, may I suggest that we extend 
a courtesy to our distinguished colleague so that he can 
proceed since I will join you for the balance of the hearing? 
So I'm going to stay.
    Vice Chairman Bond. Senator Bingaman, equally distinguished 
Senator from New Mexico.

         STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR 
                        FROM NEW MEXICO

    Senator Bingaman. Thank you very much, Chairman Bond. It's 
a pleasure to be here to introduce to the Committee and to 
endorse the nomination of Don Kerr for this important position.
    I became acquainted with Don when I first was elected to 
the U.S. Senate and he was the Director of Los Alamos National 
Laboratory, and he remained in that position until 1985. While 
there, he established a very distinguished record of service. 
He established a variety of innovative programs, one of which 
I'll just mention to the Committee--the Laboratory-Directed 
Research and Development Program, which was and continues to be 
a mechanism at the laboratory that has allowed for some of the 
very best of the research that is done at not only Los Alamos 
but all of our national laboratories to occur.
    So I admired his work as head of Los Alamos, and I've 
admired his service to the country in many capacities since 
then. You went through that list of positions that he has held, 
some in the private sector, some in the public sector.
    But I feel strongly that he is extremely well-qualified for 
this important position. I know that the Committee has a much 
clearer view than I do as to all the responsibilities that 
attach to this position that he has been nominated for, but I'm 
confident that you'll not find anybody who's better qualified 
by experience or training or capability to do the work.
    So I would recommend that Don Kerr be approved and 
recommended to the full Senate for confirmation.
    Vice Chairman Bond. Well, thank you very much, Senator 
Bingaman. We will, of course, give your comments and support 
great weight and we appreciate your taking the time to be with 
us.
    Senator Bingaman. Thank you.
    Vice Chairman Bond. Now I will turn to a fellow Member of 
our Committee, the other distinguished Senator at the table, 
Senator Warner from Virginia.
    Senator Warner. Thank you. At this time, Mr. Chairman, I 
wonder if you would invite the nominee to introduce his family.
    Vice Chairman Bond. Please, Dr. Kerr.
    Dr. Kerr. Well, it will be a very short and brief 
introduction. My wife, Alison, with whom I've been living, 
working and doing everything else one can do for the past 46 
years, is here behind me. Here she is.
    Vice Chairman Bond. Welcome, Mrs. Kerr.
    Senator Warner. That was brief.
    Dr. Kerr. I'm sorry I couldn't do better, sir.
    [Laughter.]
    Senator Warner. Well, my brief sheet says that there's a 
daughter, Margo, and she's not with us today.
    Dr. Kerr. Well, we do have a daughter, Margo. She's a 
practicing veterinarian in Denver and was here just a week or 
so ago with the two little girls she and her husband are 
adopting. But now she has to help support them.
    Senator Warner. I think it's important that the record 
reflect that family.
    Mr. Chairman, you've given a very complete briefing on the 
nominee's distinguished background, as supplemented by our 
colleague Senator Bingaman. So I just want to add a few words 
and put my statement into the record.
    Vice Chairman Bond. Please.

   STATEMENT OF HON. JOHN WARNER, U.S. SENATOR FROM VIRGINIA

    Senator Warner. I always like to start with the law, and 
that is the Intelligence Reform and Terrorism Prevention Act of 
2004 established the office of the Director of National 
Intelligence, and the law served as the most dramatic reform of 
our Nation's intelligence capabilities since Harry S. Truman 
signed the National Security Act of 1947. The 2004 law provides 
that the Principal Deputy Director of National Intelligence--
the nominee now before us--shall assist the Director in 
carrying out these duties. Together they are the principal 
advisers to the President of the United States and the National 
Security Council and the Homeland Security Council for 
intelligence matters related to national security and the head 
of the United States intelligence community and overseeing and 
directing the national intelligence program of our Nation.
    Now, despite what I have to say and what others have to 
say, the most important endorsement, I think, of this nominee, 
next to that of the President in selecting him, is that the 
Director of National Intelligence, Admiral McConnell, has 
complete confidence in this nominee's abilities to serve as his 
Principal Deputy.
    We've all seen Admiral McConnell in action, and yesterday 
was a clear example of his extraordinary abilities as he 
appeared here in the Senate on some very important matters. And 
I can only add to this, Mr. Chairman, that--I added it up here 
quickly--38 years ago I walked into the Pentagon, in the Navy 
Under Secretary's office. And I've been dealing with 
intelligence matters for 38 years. And I don't know that I've 
ever seen a more qualified individual than Don Kerr to entrust 
our Nation's intelligence to.
    Good luck to you.
    Dr. Kerr. Thank you very much.
    [The prepared statement of Senator Warner follows:]
   Prepared Statement of Hon. John Warner, U.S. Senator from Virginia
    Vice Chairman Bond and distinguished colleagues; it is my pleasure 
to introduce to you today an outstanding intelligence professional, 
public servant and Virginian--Dr. Donald M. Kerr--who has been 
nominated to serve as our second Principal Deputy Director of National 
Intelligence.
                                 family
    I would like to recognize Don's wife, Alison, who is in attendance 
today, and to thank her, along with their daughter Margot, for their 
steadfast support and sacrifice not only in support of Don, but also 
our nation.
                     role and importance of the dni
    The Intelligence Reform and Terrorism Prevention Act of 2004 
established the Office of the Director of National Intelligence. This 
law serves as the most dramatic reform of our nation's intelligence 
capabilities since President Harry S. Truman signed the National 
Security Act of 1947, and provides that the Principal Deputy Director 
of National Intelligence shall assist the Director of National 
Intelligence in carrying out his duties as:
      The principal advisor to the President of the United 
States, the National Security Council and the Homeland Security Council 
for intelligence matters related to national security and the head of 
the of the United States Intelligence Community.
      And in overseeing and directing the national intelligence 
program of the United States.
    Director of National Intelligence McConnell has confidence in Don's 
abilities to serve as his Principal Deputy.
                           career highlights
    The 2004 Act also requires that any individual nominated as 
Principal Deputy shall have extensive national security and management 
experience. Don has just that, having served in four agencies with 
intelligence responsibilities, including as:
      Deputy Assistant Secretary for Energy Technology and the 
Deputy Assistant Secretary for Defense Programs at the Department of 
Energy.
      Federal Bureau of Investigation's Assistant Director in 
Charge, Laboratory Division.
      Deputy Director for Science and Technology at the Central 
Intelligence Agency.
      Director of the National Reconnaissance Office, where he 
currently serves.
    Don began his government career at the Los Alamos National Lab in 
1966 and worked his way up through the Lab and the Department of 
Energy, eventually becoming Director of Los Alamos in 1979.
                         private sector service
    Don has been equally successful in more than a decade of experience 
in private sector leadership and management as:
      President and Director of EG&G.
      Corporate Executive Vice President of Science 
Applications International Corporation (SAIC) in Virginia.
      Executive Vice President of Information Systems 
Laboratories, Inc.
                         awards and recognition
    In addition to earning numerous awards throughout his career for 
meritorious service, Don was awarded the impressive Director's Award 
from the Director of Central Intelligence in 2004 and the CIA 
Distinguished Intelligence Medal in 2005.
                          academic credentials
    Don earned his undergraduate degree in electrical engineering and 
advanced degrees in microwave electronics and plasma physics from 
Cornell University.
                                summary
    In short, Dr. Donald Kerr has a long and distinguished record of 
service to the intelligence mission of this country, and I am very 
pleased to introduce him to the Committee today.

    Vice Chairman Bond. Thank you very much, Senator Warner. We 
appreciate very much our distinguished colleagues joining us.
    And now, before I ask the witness some questions, I want to 
add, for my colleagues, following up on what Senator Warner 
just described, we have an urgent request before not just this 
Committee but the entire Congress.
    We haven't been able to act on the DNI's initial proposal 3 
months ago to modernize the Foreign Intelligence Surveillance 
Act. But the threats are mounting, and we cannot leave the 
intelligence community blind or, you might say, deaf in some 
significant areas.
    I've been excluded from much of the negotiations that the 
majority has had with the Administration on this issue, but I 
am now involved in the issue and have talked with the DNI, as I 
believe it should be at the table. And I urge my colleagues to 
consider a revised proposal that the DNI is making that he says 
will keep the country safe.
    I'd be interested if Dr. Kerr has any comments on 
modernizing FISA. If you were already the Principal Deputy, 
then you would be spending your days and nights tending the 
shop while the DNI has been camped out on the Hill on this 
urgent matter, and as Senator Warner said, doing an excellent 
job.
    There are a series of questions that are standard 
procedure, and let me ask you those.
    First, as the nominee to be the Principal Deputy Director 
of National Intelligence, Dr. Kerr, do you agree to appear 
before the Committee here or in other venues when requested?
    Dr. Kerr. Yes, I do.
    Vice Chairman Bond. Do you agree to send officials from the 
ODNI or the intelligence community to appear before the 
Committee and designated staff when requested?
    Dr. Kerr. Yes, Mr. Chairman.
    Vice Chairman Bond. Do you agree to provide documents and 
any material requested by the Committee in order for it to 
carry out its oversight and legislative responsibilities?
    Dr. Kerr. Yes, subject only to the caveat, when restricted 
by law.
    Vice Chairman Bond. Will you ensure that the ODNI and the 
intelligence community provide such material to the Committee 
when requested?
    Dr. Kerr. Yes.
    Vice Chairman Bond. All right. Well, thank you very much, 
Dr. Kerr.
    Now if you would like to offer your opening statement, we 
would be happy to receive that.

 STATEMENT OF DR. DONALD M. KERR, PRINCIPAL DEPUTY DIRECTOR OF 
                NATIONAL INTELLIGENCE-DESIGNATE

    Dr. Kerr. Mr. Chairman, Members of the Committee, thank 
you, and with particular thanks to Senator Warner and Senator 
Bingaman for introducing me.
    I'm pleased to appear before you to discuss my credentials 
as the nominee for Principal Deputy Director of National 
Intelligence. Indeed, it is an honor to have been selected by 
the President and Director McConnell, and if I'm confirmed it 
will be a privilege to serve.
    Based on the Intelligence Reform and Terrorism Prevention 
Act, and the intelligence community Directive No. 1, as has 
been pointed out, the duties and responsibilities of the Deputy 
are substantially the same as for the DNI. However, the DNI, I 
think, will serve, as he has been, as principal adviser to the 
President and other senior officials. So I expect the Principal 
Deputy will be focused as much as possible on coordinating and 
integrating the activities and products of the 16 organizations 
that comprise the intelligence community.
    Over a 40-year career, I have held a number of senior level 
public and private sector positions and have learned a few 
things along the way. In five areas, I think I can bring 
strength and experience to this job, such as an ability to 
identify and deal effectively with troubled components, which I 
have done in at least two Government agencies to this point; a 
strong technical and management background; coalition-building 
skills; the ability to drive organizational change; and a 
strongly held belief that an effective planning system, coupled 
with strong financial management, can achieve superior results. 
While I learned this latter lesson in the private sector, I've 
applied the model to all my subsequent Government jobs.
    I've been both personally and professionally committed to 
national security throughout my career. I've had direct 
responsibility for intelligence and defense activities in four 
different Government agencies--the Department of Energy, the 
Federal Bureau of Investigation, CIA, and the NRO--and I have 
supported intelligence programs in private industry and as a 
staff member and later as Director of the Los Alamos National 
Laboratory.
    This has provided me opportunities to work on a wide 
variety of intelligence issues, including nuclear 
proliferation, treaty monitoring, nuclear test detection and 
analysis, and development of future air and space 
reconnaissance systems.
    I'm particularly proud of the programs I have led to bring 
technical solutions to intelligence and law enforcement 
challenges. My commitment to countering terrorism began with 
activities in 1978 and 1979 when I was the Department of Energy 
member of the NSC Executive Committee on Terrorism.
    This commitment was substantially reinforced by direct 
responsibilities investigating the East African embassy 
bombings of 1998 and the attack on the USS COLE in 2000, and 
certainly refocused tremendously by 9/11 and the efforts of the 
past 6 years.
    I'd like to take a minute to talk about my vision for the 
intelligence community, as well as several goals I believe are 
critical for more effectively focusing the community in the 
challenging post-9/11 environment. I'd also like to share my 
philosophy about the role of intelligence in our national 
security construct.
    A popularly held contention is that the role of 
intelligence is to protect the Nation from all harm. Well, this 
is a succinct way to talk about an ultimate goal. I think the 
situation is substantially more complicated than that. One 
academic I think got it about right, describing the role of 
intelligence as extracting certainty from uncertainty, and 
facilitating coherent decisionmaking in an incoherent 
environment.
    These are not activities that lend themselves to guarantees 
or perfect scores as we would like, but they reflect the 
reality in which we operate. If I were to state what I believe 
the essence of national intelligence is, I would say that the 
primary goal is to reduce the risks our Nation faces today and 
in the future.
    These challenges not only require our ongoing dedication 
and commitment to the national intelligence mission but, more 
importantly, new and innovative approaches to the work we do, 
the operations we plan and carry out, the collection assets we 
design, build and operate, the analyses we produce, and the 
strategic partnerships we make across traditional and 
nontraditional boundaries.
    Each era has its seemingly impossible challenges. We all 
know the future is unpredictable, and trends hard to predict. 
The elements that could significantly transform the 
geopolitical landscape include nuclear and biological weapons 
proliferation, catastrophic terrorism, and even pandemic 
disease.
    The intelligence enterprise must think ahead to ensure that 
the capabilities needed to deal with these challenging and 
ofttimes explosive issues are available to the analyst, 
policymaker, operations officer and warfighter when they are 
needed.
    This is all the more difficult, because the threat is no 
longer predictable and confined to specific geographic areas. 
It is mobile, dispersed, dynamic and distributed. Intelligence 
problems are also developing at a much more rapid pace than 
ever before. We need to posture ourselves to deal in that 
environment.
    And so a few of the things I think most important are our 
need to seek global situational awareness to the degree we can. 
We need to be able to deliver critical information to support 
timely decisionmaking by both policymakers and our military 
leadership. We need to be able to anticipate strategic threats, 
although that may be the hardest thing of all to do. 
Importantly, as a consequence of intelligence reform, we have 
to learn to operate as a unified, integrated yet distributed 
enterprise. We need to adopt technologies and concepts of 
operations that leverage U.S. advantage. And, finally, we need 
to maintain appropriate investment levels for future 
capabilities.
    To do this, I think three elements need to be in place. 
First of all, we have the duty to gather critical intelligence, 
but to do so in a way that complies with the constitutional and 
other legal requirements that protect the freedoms and 
liberties of the American people. There must be proper training 
and oversight mechanisms for the intelligence community to 
ensure that there are clear rules for their activities.
    Second, given the non-public nature of most of the 
intelligence community's work, the DNI and the principal deputy 
must also ensure that Congress is kept appropriately informed 
of IC activities to enable Congress to perform its oversight 
responsibilities. To exercise such oversight, the Committees 
must understand the intelligence process, its organizations, 
policies, funding, and activities. The DNI and other members of 
the community must communicate on a regular and continuing 
basis to keep the oversight committees fully and currently 
informed, consistent with the protection of sources and 
methods.
    Third, the intelligence community must deliver intelligence 
information to decisionmakers without bias or prejudice. 
Intelligence analysis must be held to the highest standards of 
integrity and objectivity. It must also be rigorous, timely, 
and independent from political considerations.
    To position ourselves to meet the analytic challenges of 
today and tomorrow, we must go beyond simply doing our current 
jobs better. We must transform the way our analysts do their 
work. We must more effectively leverage new and emerging 
technologies and reach out to expertise wherever it resides.
    Effectively inspiring the expertise and experience of our 
talented intelligence professionals requires strong and focused 
leadership. If confirmed, I would bring particular emphasis to 
a number of areas. I would focus on effective financial 
management, including reducing the indirect cost burden on 
mission wherever possible. This effort speaks to Director 
McConnell's goal of modernizing business practices and 
developing verifiable metrics. The real challenge is developing 
the right balance between tighter controls and mission 
effectiveness, and making financial reporting more useful to 
those who manage our programs. I believe that continuous 
improvement in financial management should be an intelligence 
community priority.
    If confirmed, I will assist the DNI in moving the 
intelligence community forward from today's uneven but 
improving financial management environment to one characterized 
by common business processes and integrated systems that adhere 
to recognized best business practices across industry and 
Government.
    Accountability is critically important in ensuring that 
officials are responsible for their actions. Within the 
intelligence community, accountability ultimately rests with 
the DNI and the Principal Deputy. However, in a Government 
based upon checks and balances and collective decisionmaking, 
determining individual accountability is often very difficult.
    It has been my experience that most Government employees, 
regardless of whether they reside in the executive, 
legislative, or judicial branches, are simply trying to do what 
is right for the taxpayer. However, there are occasionally 
egregious exceptions, and when they occur swift and decisive 
action must be taken. Each and every member of the community is 
responsible for using the resources entrusted to them 
judiciously. Additionally, all Government employees are 
expected to ensure their performance is consistent with the 
highest standards of professionalism and integrity. One of the 
first items on my agenda, if confirmed, would be to ensure that 
each member of the IC is as fully aware of what is expected and 
required as practical.
    There has been significant discussion about the role of 
contractors in the intelligence community lately. There are 
compelling reasons why we use contractors to perform critical 
functions within the intelligence community. At the NRO, our 
industry partners design and build our satellite systems as 
well as provide 24 by 7 operational and maintenance support. We 
also rely on contractors to provide the basic services that we 
generally take for granted in the course of our day. These are 
services that are more economically outsourced and include 
everything from network maintenance to janitorial support.
    There are also certain exigencies that justify an 
intelligence agency's use of contractors. For example, if an 
agency has a short- term project or mission that exceeds the 
capability of its current staff, it is sometimes more 
appropriate for that agency to use contractors to meet that 
temporary need than to hire and train permanent Federal 
civilian employees to perform the work. We also employ 
contractors or employees of federally funded research and 
development centers to provide specialized capabilities that we 
do not find within the Government workforce.
    My general philosophy is no contractor should perform 
inherently Government work, under no circumstances should a 
contractor make policy or investment decisions on behalf of the 
Government, and the use of contractors must be more cost 
effective than using Government resources. If confirmed, I will 
continue to examine the appropriate use of contractors within 
the intelligence community.
    I believe that the importance of a highly trained workforce 
cannot be overstated, either for the NRO or the intelligence 
community as a whole. While at the NRO I've taken a number of 
steps to work on that problem, starting with a statement of 
intent that I signed with the Air Force Chief of Staff more 
than a year ago that made it very clear that the Air Force and 
the NRO would work closely together to improve the career 
development of our shared workforce. We've also teamed with Air 
Force Space Command to train space professionals across the 
Government in the new National Security Space Institute at 
Colorado Springs. I'm working on similar initiatives with the 
Central Intelligence Agency.
    Currently, the NRO's Acquisition Center of Excellence is 
helping our acquisition professionals complete education 
requirements leading to advanced degrees in public management 
and engineering administration. We've also partnered with 
Virginia Tech to provide an engineering administration Master's 
degree program onsite at the NRO, and we tried to pull together 
all of the rest of our training in a virtual university 
construct to benefit all of our employees and our contractors.
    If confirmed, I look forward to supporting Director 
McConnell in his efforts to more closely integrate the 
intelligence community. During my tenure, the NRO has been 
working toward an integrated mix of overhead and ground-based 
capabilities tailored to the geographically dispersed and 
dynamic nature of the current and projected intelligence 
problems, as well as the diverse needs of our many users.
    Integration is not only a watchword for technical 
collection and operations, but it is imperative that we 
integrate intelligence collection and analysis more 
effectively. They are symbiotic disciplines. We can only 
achieve our goals and objectives by coming unified in our 
commitment to the intelligence community's contribution to the 
strongest defense possible for our Nation and our people.
    Thank you for the opportunity to share with the Committee 
my background and, if confirmed, my vision for my new role and 
responsibilities. I look forward to answering any questions you 
may have. Thank you, Mr. Chairman.
    [The prepared statement of Dr. Kerr follows:]
     Prepared Statement for Dr. Donald M. Kerr, Director, National 
    Reconnaissance Office and Principal Deputy Director of National 
                         Intelligence-Designate
    Mr. Chairman, Members of the Committee, I am pleased to appear 
before you to discuss my credentials as the nominee for Principal 
Deputy Director of National Intelligence--the PDDNI. Indeed, it is an 
honor to be asked, and if confirmed it will be a privilege to serve. In 
discussions with the Director of National Intelligence (DNI)--
McConnell, we agree that the role of the PDDNI is analogous to that of 
the chief operating officer of a public company. While the DNI is chief 
executive officer for the Intelligence Community (IC)--and principal 
intelligence adviser to the President and other senior leaders, the 
PDDNI should be focused on coordinating and integrating the day-to-day 
efforts of the 16 elements that comprise the IC. Before addressing my 
vision for the IC, allow me to highlight my background that uniquely 
qualifies me to serve as the PDDNI.
    Over a 40-year career, I have held a number of senior-level public 
and private sector positions, and have obtained a number of critical 
skills and lessons learned. In considering the challenges facing the 
IC, as well as the responsibilities of the PDDNI, I would ask you to 
consider five key areas of strength and experience that are applicable 
to this position: an ability to identify and deal effectively with 
troubled components; a strong technical background; coalition-building 
skills; the ability to drive organizational cultural change; and a 
strongly held belief that an effective planning system coupled with 
strong financial management can achieve superior results. While I 
learned this latter lesson in private industry, I have applied this 
model in all my subsequent Government assignments. I have also learned 
that the tools and techniques, used to integrate acquired companies, 
can be effectively applied in the Government environment.
    As this Committee knows from first-hand experience, I have been 
both personally and professionally committed to national security 
throughout my career. I have had direct responsibility for intelligence 
and defense activities in four different government agencies: the 
Department of Energy, the Federal Bureau of Investigation, the Central 
Intelligence Agency, and the National Reconnaissance Office, and have 
supported intelligence programs in private industry, and as a staff 
member and later as director of a national laboratory. I have had 
opportunities to work on a wide variety of intelligence issues, 
including nuclear proliferation, arms control monitoring, nuclear test 
detection, and the development of future air and space reconnaissance 
systems. I am particularly proud of the programs I have led to bring 
technical solutions to intelligence and law enforcement challenges. My 
commitment to countering terrorism began with activities in 1978-79 as 
a member of the NSC Executive Committee on Terrorism. This commitment 
was substantially reinforced by direct responsibilities investigating 
the East African embassy bombings in 1998 and the attack on the USS 
Cole in 2000, and refocused by 9/11 and the efforts of the past 5 
years.
    I would like to share my personal vision for the IC, as well as 
several goals that I believe are critical for more effectively focusing 
the Community in the challenging, post-9/11 environment. I would also 
like to share my philosophy about the role of intelligence in our 
national security construct. A popularly held contention is that the 
role of intelligence is to protect the Nation from all harm. While this 
is a succinct way to state the ultimate goal, I think the situation is 
more complicated than that. One academic described the role of 
intelligence as extracting certainty from uncertainty and facilitating 
coherent decisionmaking in an incoherent environment. These are not 
activities that lend themselves to guarantees or perfect scores as we 
would like, but they reflect the reality in which we operate. If I were 
to state what I believe is the essence of national intelligence, I 
would say that its primary goal is to reduce the risk our Nation faces 
today and tomorrow. The National Intelligence Estimate, ``The Terrorist 
Threat to the US Homeland,'' makes clear that we will face a persistent 
and evolving terrorist threat over the next several years--a threat 
that will challenge our current defensive efforts and tools we use to 
detect and disrupt plots.
    My ``philosophy'' is not meant to minimize the critical role each 
and every one of our intelligence professionals nor the Intelligence 
Community, as a whole--plays in warning about current and future 
threats. The challenges we face not only demand our ongoing dedication 
and commitment to the national intelligence mission, but more 
importantly new and innovative approaches to the work we do; the 
operations we plan and carry out; the collection assets we design, 
build and operate; the analyses we produce; and the strategic 
partnerships we make across traditional and non-traditional boundaries.
    Every era has its seemingly impossible challenges. The future is 
fraught with unpredictable elements and trends. The elements that could 
significantly transform the geopolitical landscape include nuclear 
proliferation, catastrophic terrorism and even a pandemic disease. The 
intelligence enterprise must think ahead to ensure that the 
capabilities needed to deal with these challenging and oft times 
explosive issues are available to the analyst, policymaker, operations 
officer, and warfighter when they are needed. This is all the more 
difficult, because the threat is no longer predictable and confined to 
specific geographic areas. It is mobile, dispersed, dynamic, and 
distributed. Intelligence problems are also developing at a much more 
rapid pace than ever before. We must posture ourselves to adapt and 
respond quickly, in an integrated fashion, to evolving problems. To 
that end, I believe there are a number of goals that capture what we 
need to excel as a Community in order to grow our comparative advantage 
and reduce the myriad risks to our nation:
      Seek global situational awareness
      Deliver critical information to support timely 
decisionmaking
      Anticipate strategic threats and
      Operate as a unified, integrated--but distributed--
enterprise
      Adopt technologies and concepts of operation that cause 
adversaries to react in ways that give the US advantage
      Maintain appropriate investment levels for future 
capabilities
    In order to set the Intelligence Community on a path toward 
achieving these goals, there are three elements that need to be in 
place to support the Community. First, the IC has a solemn duty to 
gather critical intelligence, but to do so in a way that complies with 
the constitutional and other legal requirements that protect the 
freedoms and liberties of the American people. There must be proper 
training and oversight mechanisms for the IC to ensure that there are 
clear legal rules for IC personnel operating in this critical area. 
Given the non-public nature of much of the IC's work, the DNI must also 
ensure that Congress is kept appropriately informed of IC activities to 
enable Congress to perform its oversight responsibilities.
    Second, we have a responsibility to provide timely information to 
Congress to support effective oversight. Congressional oversight plays 
a key role in ensuring that the Intelligence Community is performing as 
envisioned. To exercise such oversight responsibilities, the Committees 
must understand the intelligence process, its organizations, policies, 
funding, and activities. The DNI and other members of the Community 
must communicate on a regular and continuing basis to keep the 
oversight committees fully and currently informed, consistent with the 
protection of sources and methods.
    Third, the Intelligence Community must deliver intelligence 
information to decisionmakers without bias or prejudice. Intelligence 
analysis must be held to the highest standards of integrity and 
objectivity. It must also be rigorous, timely and independent from 
political consideration. To position ourselves to meet the analytic 
challenges of today and tomorrow, we must go beyond simply doing our 
current jobs better. We must transform the way our analysts do their 
work. We must more effectively leverage new and emerging technologies 
and reach out to expertise wherever it resides. If confirmed, I will 
strongly support the Intelligence Community's efforts to measure and, 
track progress in implementing these analytic standards, including the 
use of alternative analysis.
    Effectively inspiring the expertise and experience of our talented 
intelligence professionals requires strong and focused leadership. If 
confirmed, I would bring particular emphasis to a number of areas. I 
would look to focus on effective financial management, including 
reducing the indirect cost burden wherever possible. This effort speaks 
to Director McConnell's goal of modernizing business practices and 
developing verifiable metrics. My experience at the Central 
Intelligence Agency (CIA) and the National Reconnaissance Office (NRO) 
is that accountability for funds is effective. Although there are 
always improvements that can be made, the real challenge is developing 
the right balance between tighter controls and mission effectiveness 
and making financial reporting more useful to those who manage our 
programs. I believe that continuous improvement in financial management 
should be an Intelligence Community priority.
    While at the NRO, I have seen first-hand the added-value in 
establishing more effective financial management processes, procedures 
and management controls to put us on a path toward an unqualified audit 
opinion. The DNI recently developed a unified financial management plan 
for the IC as part of his 100 day plan to modernize business processes. 
If confirmed, 'I will assist the DNI in moving the Intelligence 
Community forward from today's uneven, but improving, financial 
management environment to one characterized by common business 
processes and integrated systems that adhere to recognized best 
business practices across industry and government. I strongly support 
Director McConnell's emphasis in this area.
    Accountability is critically important in ensuring that officials 
are responsible for their actions. Within the IC, accountability 
ultimately rests with the DNI and the PDDNI. However, in a government 
based upon checks-and-balances and collective decisionmaking, 
determining individual accountability is often very difficult. It has 
been my experience that most government employees, regardless of 
whether they reside in the executive, legislative or judicial branches, 
are simply trying to do what is right for the taxpayer. However, there 
are occasionally egregious exceptions, and when they occur, swift and 
decisive action must be taken. Each and every member of the 
Intelligence Community is responsible for using the resources entrusted 
to them judiciously. Additionally, all government employees are 
expected to ensure their performance is consistent with the highest 
standards of professionalism and integrity. One of the first items on 
my agenda, if confirmed, would be to ensure that each member of the IC 
is fully aware of what is expected and required. I will take decisive 
action wherever and whenever necessary.
    There has been much discussion recently about the role of 
contractors in the Intelligence Community. There are compelling reasons 
we use contractors to perform critical functions within the IC. In the 
NRO construct, our industry partners design and build our satellite 
systems, as well as provide 24/7 operational and maintenance support. 
We also rely on contractors to provide the basic services that we 
generally take for granted in the course of our day. These are services 
that are more economically outsourced and include everything from 
network maintenance to janitorial support. There are also certain 
exigencies that justify an intelligence agency's use of contractors. 
For example, if an agency has a short term project or mission that 
exceeds the capacity of its current staff, it is sometimes more 
appropriate for that agency to use contractors to meet that temporary 
need than to hire and train permanent Federal civilian employees to 
perform the work. We also employ contractors to provide specialized, 
niche capabilities that we may not be able to perform with government 
personnel. In each of these areas, contractors must be used 
judiciously, with full oversight from the government to ensure that 
they provide the services we need but do not perform work that is 
inherently governmental. If confirmed, I will continue to examine the 
appropriate use of contractors within the Intelligence Community. The 
key to successful partnership with the contractor community is to view 
the management of the relationship as an inherently government 
function.
    My general philosophy in evaluating the appropriate use of 
contractor support is: no contractor shall perform work that a 
government person should be doing; under no circumstance should a 
contractor make policy or investment decisions on behalf of the 
government; and the use of contractors must be more cost effective than 
using government resources. For example, to establish a cadre of 
government network administrators would be more expensive and possibly 
less effective than to contract-out with a telecommunications company 
to provide the service. It is appropriate to use contractors when they 
offer unique, distinct, or ``surge'' capabilities that may not be 
available within the government. Most importantly, all contractors and 
employees of the Federal Government must comply with the Constitution 
and laws, as well as with the governing regulations of the organization 
they support. If confirmed, I will continue to examine and enforce the 
appropriate use of contractors within the IC.
    I believe that the importance of a highly trained workforce cannot 
be overstated, both for the NRO and the IC. I have taken a number of 
steps in this area while at the NRO. First, I signed a Statement of 
Intent with the Air Force Chief of Staff, which makes clear that the 
Air Force and NRO will work together to improve the career development 
of our shared workforce. The NRO has also teamed with Air Force Space 
Command to train space professionals across the government at the new 
National Security Space Institute in Colorado Springs. I am working on 
similar initiatives with the CIA. Currently, the NRO's Acquisition 
Center of Excellence is helping NRO acquisition professionals complete 
education requirements leading to advanced degrees in Public Management 
and Engineering Administration. We have also partnered with Virginia 
Tech to provide the Engineering Administration degree program onsite at 
the NRO. In addition, the NRO is also establishing a virtual University 
that will provide an integrated, career-focused program that combines 
specialized training provided by the NRO directorate- and office-based 
schools with an NRO-wide curriculum focused on shared context, values, 
informational needs, and leadership. These initiatives are in addition 
to an already robust Systems Engineering Professional Development and 
Certification program that last year certified 151 systems engineers.
    If confirmed, I look forward to supporting Director McConnell in 
his effort to more closely integrate the Intelligence Community. During 
my tenure, the NRO has been working toward an integrated mix of 
overhead and ground-based capabilities tailored to the geographically 
dispersed and dynamic nature of current and projected intelligence 
problems, as well as the diverse needs of our users. Integration is not 
only a watchword for technical collection and operations, but it is 
imperative that we integrate intelligence collection and analysis more 
effectively--they are symbiotic disciplines.
    We can only achieve our goals and objectives by becoming unified in 
our commitment to the Intelligence Community's contribution to the 
strongest defense possible for our Nation and our people. Thank you for 
the opportunity to share with the Committee my background and--if 
confirmed--my vision for my new role and responsibility. I look forward 
to answering any questions you may have.

    Vice Chairman Bond. Thank you very much, Dr. Kerr. I was 
going to ask about your goals and I think you've laid them out 
and the difficulty of predicting the future. I was reminded of 
Yogi Berra's admonition. He said, ``Never make predictions, 
particularly about the future.'' I've always thought that was a 
sound piece of advice.
    But there's only 1\1/2\ years left in this Administration. 
Can you tell us why you took on this job?
    Dr. Kerr. I thought about it very carefully and had some 
extensive discussions with Director McConnell, with my wife, 
and with others whose judgment I respect.
    At the end of the day, in all honesty, I could not continue 
to be on the outside expressing views when the proper thing to 
do was to try to see if, by joining other seasoned 
professionals in the leadership, both at the Department of 
Defense and at the DNI--to see if we could make this thing 
work.
    That includes the responsibility to respond to the comment 
you made, which is, the legislation in 2004 was put together, 
the office of the DNI stood up; and now, with 3 years behind 
us, there's the opportunity to look back and say, what needs to 
be changed, either in legislation or in an Executive order, 
that would make it work better?
    And I think, between Secretary Gates, Under Secretary 
Clapper, Director McConnell, General Hayden, and me, we have 
the potential--for five people who've worked together without 
friction--to try to make it work and maybe to pass it on to 
others in a more institutionalized form than it is today.
    Vice Chairman Bond. Thank you, sir.
    The next thing I had mentioned, I wanted to find out if you 
had any comments on the FISA modernization or if you've been 
involved with the DNI's very excellent efforts to bring the 
case onto the Hill. What advice you can share with us on that?
    Dr. Kerr. Well, I've not been directly party to the 
discussions going on between Director McConnell and the 
Congress. But that said, I share his view that we do need to do 
something to modernize FISA. I could speak more extensively in 
closed session with you, but suffice it to say, 30 years ago 
there were certain assumptions about the future and certain 
realities of the context when the original legislation was 
passed.
    Those assumptions and realities have changed considerably 
and, consequently, the legislation needs to be changed to 
actually deal with the way modern telecommunications systems 
work and allow the intelligence community to do the things it 
needs to do to collect foreign intelligence on foreign 
individuals outside of the United States without a warrant. 
And, of course, at the same time we should always be in the 
position of, if the target's within the United States, of 
seeking a warrant to do that.
    Those two things are very important, coupled with the 
concern for those from which we would get information that they 
not be at risk for cooperating with the Government in this very 
important endeavor.
    Vice Chairman Bond. Let me deal with a point of friction 
for this Committee. This Committee came into possession of a 
point paper prepared by the NRO relating to commercial imagery. 
The paper appeared to be written in the fashion of talking 
points in opposition to commercial imagery. When our staff 
requested to be briefed on this document, the NRO declined. The 
NRO Office of Congressional Affairs advised that you had 
personally denied the Committee's staff access to the requested 
information.
    We could find no information in the point paper that would 
appear to justify refusing to brief Congress on its content. 
Are you familiar with that action and did you personally deny 
this request? Or did someone on your Congressional liaison 
staff misrepresent this?
    Dr. Kerr. I think it may fall in the latter category. The 
only paper I know about is one that my former deputy wrote as a 
personal thing doing a financial analysis based on public 
sources. It was not an official NRO document.
    Vice Chairman Bond. No, this was definitely not--I think we 
may want to explore later who had the authority to deny a 
request for the information from Congress--who would, down the 
line, have that authority.
    Dr. Kerr. Well, I think I can help you by telling you what 
I've said about this subject. Would that be helpful?
    Vice Chairman Bond. Sure.
    Dr. Kerr. I'll give you a quote. I recommended that the 
Government purchase geospatial products and services from the 
commercial remote sensing industry, as well as needed imagery 
``to ensure this information has the highest flexibility and 
utility for Government users and to encourage new applications 
of imagery data from the private sector.'' I signed that in 
October 2001 in response to tasking from the Secretary of 
Defense and the then DCI, when I led the remote sensing study 
panel.
    Vice Chairman Bond. Well, we will explore with you later 
the other paper.
    Dr. Kerr. I don't know what you're referring to, sir.
    Vice Chairman Bond. We will explore that later. Now for the 
questions, I turn to Senator Warner.
    Senator Warner. Thank you, Mr. Chairman. In listing the 
five matters that you felt you had a proficiency in, I would 
like to suggest a sixth, and that is you have a good grasp of 
how to work with the Congress. I've had that privilege in the 
years on the Armed Services Committee where you've testified a 
number of times before that Committee, and now on my second 
term in the Intelligence Committee.
    I'd also like to join the Ranking Member in his commentary 
with regard to the contribution of General Burgess filling in 
for this period of time. He's held in very high esteem here in 
the Congress and we wish him well.
    Going back to the definition, as I've said, under the law, 
that you and Admiral McConnell have as adviser to the 
President, I hope I'm not being presumptuous in saying the 
following. I think that the intelligence community has got to 
work with the executive branch, and most particularly the 
office of the President, in more clearly defining the enemy 
that faces not only the United States, but much of the free 
world today.
    We use the term ``war on terrorism,'' and now that seems to 
be misunderstood in many parts of the world. Great Britain has 
ceased to use that term; some of our colleagues in the House 
have ceased. And I must say, that term is not specific. We talk 
about ``radical Muslims'' or ``radical jihadists,'' and it's 
difficult for the general public, which wants to be 
supportive--and the general public which is deeply concerned 
after 9/11 about the vulnerability not only here at home, but 
of our people, hundreds of thousands of them that serve abroad, 
and most notably those in uniform and members of the 
intelligence community--the CIA and others, and the embassies. 
So I would hope that you could provide here this morning, and 
that you and the Admiral can, in working in briefings, try to 
more clearly define what that enemy is.
    In my judgment, it's clearly a global threat; it's not just 
isolated cells. There is a measure of some coordination. But 
first, what is the term that you would describe, generically, 
who the enemy is? And with respect to the Muslim world, that's 
a long and venerable and proud culture, and it's relatively a 
small number of those that are within that culture that are 
perpetrating the evil that's unfortunately spreading into 
places well beyond Iraq and Afghanistan.
    Dr. Kerr. I think one of the things I need to do, of 
course, is immediately recognize that I'm not a political and 
economic analyst steeped in studying some of these threats 
around the world. That said, given the responsibility that I 
may take on, I'm going to have to work very much with a very 
senior analyst, named Director McConnell, who has been spending 
his time trying to think about this very problem and how to 
properly frame the question.
    I think it's clear at this point that simply using the 
terms that go with armed conflict--``war'' and others--is an 
insufficient way to think about the problem. I think we're at a 
juncture where we have to think about the other instruments of 
American power and how they join with our incredible military 
prowess to project what we as Americans want the rest of the 
world to see, and for them to perhaps move away from thinking 
that the solution to their problems is simply to damage 
Americans or do worse.
    I don't think it's restricted to people of Islamic faith. 
It's been the history of this country----
    Senator Warner. I didn't suggest that, clearly.
    Dr. Kerr. Yes.
    Senator Warner. But that seems to be a focal point of much 
of our attention now in both Iraq and Afghanistan. But what 
better evidence of that is our own internal bombing of Oklahoma 
some years ago.
    Dr. Kerr. Exactly.
    I think another thing we have to pay a great deal of 
attention to--and it's been in some of the estimates that you 
have seen--is that set of countries where the demographics are 
such that right now half of the population is male, under the 
age of 15. And in 10 years, they will be in their early 
twenties, unemployed, perhaps without hope and consequently 
fodder, if you will, to lash out at America and America's 
interests. And so I'm greatly concerned about that and what we 
might be able to do as a country to influence those places in 
the world and how they develop before it becomes something that 
we would characterize as a conflict.
    Senator Warner. Thank you.
    Mr. Chairman, I just simply wish to first compliment you on 
your statement. I thought it was very comprehensive. But back 
to my question, I would suggest that I'd invite you to further 
amplify your thoughts in the record because it would be of 
importance to us to study precisely what those definitions 
are--particularly why the term ``global war on terrorism'' is 
found to be offensive to many people who have the best 
intentions.
    One other caution: In this world in which we live, you've 
got to deal with the split-second answer in today's rapid media 
and dissemination of information. So we've got to come up with 
clear, precise definitions and repeat them constantly to the 
public so they know more precisely. This country's making an 
enormous sacrifice of life and limb and in every other way to 
help not only defend ourselves, but other people across this 
world who stand in fear of the threats that face us today.
    Vice Chairman Bond. Thank you very much, Senator Warner.
    You've raised a question that we've debated, both in public 
and in private hearings, on learning more about the enemy, 
learning the terminology. And I think I've found a helpful 
tack, saying that these radicals are not jihadists, which is a 
holy spiritual journey for a believing Muslim. They are 
mufsidun committing hirabah and we should not glorify them by 
calling them jihadists.
    With that totally useful piece of information, I now turn 
to Senator Nelson.
    Senator Nelson. Thank you, Dr. Kerr, for your public 
service.
    What would you do as the Deputy Director to get agencies 
motivated more to invest in research and development?
    Dr. Kerr. Senator Nelson, thank you for the question. 
You've struck on a concern that I've had for some time, because 
I've actually lived in the best of the intelligence community 
for investing in the future, and I have lived in an agency 
that, in fact, did it the least.
    And I think part of what I might be able to contribute to 
is a more general community view of what appropriate levels of 
investment are needed for the future of our community and our 
country. Clearly, there are agencies that require more 
investment in technology to carry out their mission than 
others. So it isn't a case of just picking a number across the 
board, but it is appropriate to say you've got to be investing 
today for your problems 3, 5, and 10 years out.
    And I think we have not done that well, particularly with 
the pressures of the last few years to support current 
operations. I don't want to take resources from current 
operations, but if there are ways we can find to manage the 
resources we have better to make room for some future 
investment, I sorely want to do that.
    Senator Nelson. Well, what about the new Intelligence 
Advanced Research Project Authority--IARPA--which is modeled 
after DARPA?
    Dr. Kerr. That, of course, has just stood up. We have yet 
to see whether it can gain the same sort of stature and 
visibility in the intelligence community that DARPA has gained 
with the Department of Defense and the military services.
    One of the things noteworthy about DARPA and their major 
programs today is that every one of them is done in alliance 
with one of the services or other Defense agencies. IARPA has 
not existed long enough to build those alliances and 
connections and, to succeed, it will have to.
    Senator Nelson. Does the DNI support IARPA?
    Dr. Kerr. Yes, he does. He's testified to that effect. And 
I think my responsibility will be to work with him so that the 
actual execution meets his expectations.
    Senator Nelson. So what would you do to enhance its 
stature?
    Dr. Kerr. I think the first thing I would do would be to 
improve the connections with the agencies and the programs they 
already have. IARPA has been viewed with suspicion by them, 
particularly in instances where it appeared that the funds for 
IARPA were coming out of their normal operating budgets. That's 
not the way to gain friends. And so somehow there has to be a 
mechanism that they become partners rather than competitors for 
the same resources.
    Senator Nelson. You have been the head of the National 
Reconnaissance Office. And there have been some big programs 
that have been sole-sourced instead of competed. And of course, 
the U.S. policy is that we compete. Can you explain the 
apparent anti-competition policy?
    Dr. Kerr. We're really, in some ways, dealing with a part 
of the economy that is different from what I'll call the 
competitive private sector. We're dealing with a protected 
sector of the economy, which has dealt with companies that have 
chosen to do the majority of their business with the U.S. 
Government. In some cases, those companies have had substantial 
investment over the years in particular capabilities that exist 
only within those companies. And so unless the United States 
Government is prepared to make comparable investments in 
prospective competitors, they really don't get to the point of 
competing in a credible way.
    So what we have to do, as we look ahead, is ask which parts 
of the NRO program are most amenable to competition. For 
example, you might argue certain classes of sensors would be, 
where you might have three or more competitors available, 
whereas a certain other specialized capability would need to go 
to the company that had been the beneficiary of the prior 
Government investment and had the expertise to do a particular 
kind of work.
    Senator Nelson. So you would want to encourage competition 
where there were several vendors that could do the work.
    Dr. Kerr. Yes, sir.
    Senator Nelson. OK. And I realize that you inherited some 
huge problems when you came in as the head of NRO. This has 
been a concern of this Committee's, and it's been a concern of 
the Armed Service Committee as well.
    There were particularly two huge classified programs within 
the bosom of this Committee that were canceled, and as a result 
there's been a lot of money that has gone down the drain. These 
two programs represented significant new acquisitions 
undertaken by the NRO and they were touted by the NRO as 
examples of excellence and industry ingenuity, and both of them 
failed. Who was held accountable for these failures?
    Dr. Kerr. Well, let me speak to the first of them, because 
when I came to the NRO, the so-called red team--the technical 
review team--had just completed its work with respect to one of 
those programs. I had been aware of their work, and in fact had 
been briefed on it along the way. And it was in fact after 
reviewing their recommendations as well as the work of the 
staff at the NRO that I went to Director Negroponte and 
recommended termination of that program.
    The reason I recommended termination of that program was 
that I felt there was little to no prospect of that part of the 
program being successfully completed. We had managed to lay 
requirements on top of requirements. We had managed to change 
some direction enough times that we had a system that could not 
be manufactured by normal human beings.
    Director Negroponte took that recommendation. He spent time 
considering it, but within about 3 weeks he directed me to 
terminate that part of the program, which I did.
    With regard to how do we protect some of the investment 
made, we have in fact funded the continued reduction of 
technical risk in some of the specific new technologies that 
were part of that program. And they're slated for use in future 
programs, which I can talk to you about in a classified 
session. We think we have done about as well we can to recover 
that part of the investment. That said, we couldn't recover a 
significant amount of it, as you're well aware.
    Vice Chairman Bond. Dr. Kerr, we will go into a classified 
session, and I think Senator Nelson will and I will and others 
will want to follow up.
    Thank you.
    Senator Nelson. Well, Mr. Chairman, the question was, in 
the public session, who was held accountable?
    Vice Chairman Bond. I didn't hear anybody.
    Dr. Kerr. Well, I'll answer that, too.
    In fact, the program manager was removed from that program, 
as well as the direct reports. The senior leadership at the 
prime contractor was changed. The award fees reflected the 
unhappiness of the Government with their performance, and they 
have subsequently been put on the contractor responsibility 
watch list that the NRO has, which means that they can only bid 
on new work if we grant them a waiver. And they will not come 
off that list until they start delivering hardware to us. We're 
not satisfied with just changes in names and particular jobs 
and reorganization; we want to see the product that we've 
contracted for.
    Senator Nelson. Mr. Chairman, if I don't make it to the 
classified session, if you would get the details of that, I 
would appreciate it.
    Vice Chairman Bond. You can be sure we will. Thank you very 
much, Senator Nelson.
    Senator Chambliss.
    Senator Chambliss. Thank you very much, Mr. Chairman. And 
Dr. Kerr, thank you for your service. We appreciate you very 
much.
    And, Mr. Chairman, let me just echo the sentiments of you 
and Senator Warner relative to General Burgess. Boy, I don't 
know a member of the IC community that has been more direct, 
more straightforward and given us better briefings over the 
years than General Burgess. I'm sure glad to see he's going to 
stay with ODNI.
    Dr. Kerr, we have a mutual friend, Steve Van Cleve, who 
certainly gives you a very high recommendation and sends his 
best wishes.
    As a Member of the House Intelligence Committee following 
September 11, we did a significant investigation into the 
reasons why September 11 happened. And it was pretty obvious to 
us then, there's been a lot of commentary, a lot written and 
said about some of the reasons why, but it comes back to one 
basic reason, and that is there was a total lack of information 
sharing.
    Now, you've been in the IC community both at CIA, at the 
FBI, and now at the NRO, and obviously you're moving into a 
much different atmosphere of your intelligence employment 
history here. What I want you to comment on is what you've seen 
relative to information sharing, what you think may be done or 
may have been done to improve that. Where do you think we still 
need some improvement? And in your position as the Deputy 
Director of the DNI, I want to hear what you think you might be 
able to accomplish relative to continuing to help the 
information sharing issue spread.
    Dr. Kerr. I think this is perhaps one of the issues that's 
a core issue of the intelligence reform legislation. I think 
steps have been made to have improved the situation from what 
it was in 2001 before 9/11. And that said, not enough has been 
done.
    And I can simply give you an anecdote to help explain that. 
And it goes back to General Burgess, for whom we all have high 
regard. He wanted to send an e-mail to all of the 16 agencies 
in the community to people by name and found that that was 
impossible at the present time. And so one of the key things 
that we have to work on is we have to provide the 
infrastructure so that information sharing can be done directly 
and quickly rather than by working around awkward legacy 
systems from the past.
    But the infrastructure's only part of it; the attitude is 
the other part of it. Now when I was at the FBI, we, in fact, 
had senior CIA personnel assigned there in line jobs. They were 
very effective at doing it. And there were FBI people assigned 
to the Counterterrorism Center at CIA. But the simple exchange 
of people isn't enough either because, the way these 
organizations work, the connections have to be made not just at 
the top, not just at certain mid-level functions where they 
decide that swap of people makes sense, but it has to become a 
way of doing the work. And I would say that the real test of 
the leadership for the DNI and his deputy is going to be the 
degree to which we can change some of the attitudes that don't 
allow us to have that full connectivity at all levels between 
the agencies to focus on very hard problems.
    Senator Chambliss. Well, I think you're exactly right. 
Those stovepipes that we've talked about so often unfortunately 
still exist--maybe not to the degree that they did prior to 
September 11, but certainly there's some still there. And 
frankly, going back to what Senator Nelson asked you about, I 
have an appreciation for the fact that you did step into a not-
so-good situation at NRO. You made the changes that were 
necessary. I fully expect you to do the same thing here at 
ODNI, and I have all great confidence that you will.
    So thank you for your willingness to continue to serve your 
country in this capacity, and we look forward to seeing this 
confirmation concluded.
    Dr. Kerr. Thank you, Senator Chambliss.
    Vice Chairman Bond. Thank you very much, Senator Chambliss.
    Senator Mikulski--OK, she's gone.
    Senator Burr is gone.
    [The prepared statement of Senator Mikulski follows:]
  Prepared Statement of Hon. Barbara A Mikulski, a U.S. Senator from 
                                Maryland
      It's great to welcome Dr. Kerr to this important 
confirmation hearing. This position, the Deputy Director for National 
Intelligence, has been vacant for too long, and DNI McConnell is 
certainly in need of a permanent deputy.
      Dr. Kerr, you've led a distinguished career in the 
Intelligence Community, serving in a variety of places. This includes 
at the Department of Energy, Los Alamos National Laboratory, the 
Federal Bureau of Investigation, the Central Intelligence Agency, and 
now, serving currently as the Director of the National Reconnaissance 
Office.
      There are five criteria that I use to evaluate all 
executive branch nominees. They are (1) Competence, (2) Integrity, (3) 
Independence, (4) Commitment to the Constitution, and (5) Commitment to 
the Core Mission of the Department
      First, I believe Dr. Kerr has the experience and 
background for this important job. You've had success in both the 
private sector and the Intelligence Community--serving in your current 
position as Director of the National Reconnaissance Office since 2005. 
The NRO is an important agency in the Intelligence Community. It has 
had some successes, as well as a number of problems, too.
      Dr. Kerr has also served as a Deputy in CIA's Science & 
Technology Directorate. This also highlights his background in science 
and technology, which I believe is a real plus for a DDNI to have. Our 
historical technological advantage over our adversaries is eroding and 
we need much stronger ties between science and technology communities 
and our intelligence agencies.
      Dr. Kerr, I think that you will agree with me, that we 
must regain our technological edge in the world in science and 
technology.
      While I do not know Dr. Kerr personally, we did enjoy a 
very good, and I thought, frank conversation.
      Dr. Kerr is well-respected both inside and outside the 
Intelligence Community and I have no reason to doubt his personal 
integrity. However, as always, the proof of his integrity will be in 
his actions and deeds, if he is confirmed to serve as DDNI.
      For me, Integrity and Independence are closely tied. We 
are in need of independent voices at the ODNI, and not cheerleaders for 
the Administration. We need people at the ODNI who can speak truth to 
power, no matter who is President. We also need a commitment from the 
Intelligence Community leadership to provide timely and frequent 
notifications to the Intelligence Committees.
      As DDNI, Dr. Kerr, you will be forced to make tough 
choices. This includes decisions to end controversial programs to 
financing innovative acquisition projects. No matter the task, the ODNI 
needs independent voices, and not rubber stamps for this 
administration's policies.
      I've been greatly honored to take the oath of office 9 
times. Each time, I raise my right hand and swear to support and defend 
the Constitution of the United States of America. We all take that 
oath--no matter if you serve in Congress, the Cabinet, or wear a 
uniform. That oath, however, is not to an administration, a president, 
or a party. The oath is sworn to the Constitution.
      The threats facing the country today are real, and 
evolving. Terrorists across the globe have predatory intent and want to 
harm the American people. Some programs designed to keep the American 
people safe do need to remain secret. But, each and every one of these 
programs must respect the Constitution and what it stands for.
      The current administration only adheres to the law when 
it chooses to. It doesn't take the commitment to the Constitution 
seriously. So Dr Kerr, we need a real commitment from you to uphold the 
Constitution. This commitment includes respecting the role of Congress 
and the need for effective checks and balances.
      There is no question that Dr. Kerr is committed to the 
mission of the Intelligence Community. He has served the community in a 
variety of roles, and is a dedicated public servant.
      As DDNI, Dr. Kerr will need to help strengthen the 
organization. This includes achieving the integration that the 
intelligence community needs, and helping to minimize and break-down 
any remaining ``stove pipes'' in the intelligence community.
      There will also be occasions where Dr. Kerr will have to 
serve as the Acting DNI. These are big shoes to fill, and we are all 
thankful that DNI McConnell has ably handled this responsibility during 
the past year.
      In conclusion, this committee has many questions for you, 
and I look forward to your answers. Again, I thank you for the service 
you've already provided to the United States. I hope we have a candid, 
frank discussion with you about the future of the DDNI and your 
thoughts on how you believe the position will develop under your 
direction and leadership.

    Senator Whitehouse.
    Senator Whitehouse. Thank you, Chairman.
    Dr. Kerr, welcome. I don't want to hide the ball in any 
respect. I at this point very much anticipate voting for your 
nomination and supporting you, but there are a few things I'd 
like to touch base with you on at this point in the public 
hearing.
    The first is that I'm new in my position; you're about to 
be new in yours. We both have a lot of inherited baggage 
between our organizations. I hope you will understand that when 
this Committee seems perhaps from your point of view to be 
unduly determined, unduly persnickety, unduly inquisitive about 
matters that the recent history has not been very favorable and 
that our desire to pursue these things and our sense of 
suspicion, if you will, has been well-earned. I think it can be 
earned back, a sense of trust can be earned back, but I urge 
you to bend over backwards to accommodate our concerns and 
questions as we do our oversight job, bearing in mind that, to 
a certain extent, here the past is the future.
    In that regard, the two big issues that I see are, first, 
the issue of intelligence integrity. There have clearly been 
episodes in which the intelligence community or elements of the 
intelligence community have produced the intelligence that 
principals wanted to support the path that had already been 
chosen rather than what people might call speaking truth to 
power. In accounting, people often talk about a plug number 
that fits between--we don't want plug intelligence around here.
    In that vein, you have superior scientific credentials. You 
have superior management credentials. Your analytic credentials 
are not as strong as your management and scientific 
credentials, as you alluded to earlier. You are also the Deputy 
Director, and if the Director is away, you will be the Acting 
Director. A circumstance could easily emerge in which you are 
representing the intelligence community with principals in the 
White House at times of key decisions. What will your process 
be for making sure that truth is in fact told to power and that 
the real intelligence is what gets to the decisionmakers, not 
just what they want to hear?
    Dr. Kerr. Well, I can tell you first of all that I 
absolutely support your point that intelligence needs to be 
provided to policymakers and others who need it without bias, 
without political consideration, and as well-grounded in fact 
as possible.
    With regard to what I would do, while my technical and 
management credentials are better than my analytic ones, I did, 
in fact, serve on the nuclear intelligence panel and chair it 
for a number of years within the community--in fact, from 
roughly 1979 until 1992. And I've been a senior reviewer of 
many of the Estimates over the years.
    So I think what I'm really trying to express is that 
Director McConnell and I are complementary in a way. He is an 
analyst by training and by profession, and that's his strongest 
suit. I have some other experiences that are complementary to 
his, and I think between us we can make a good team.
    With regard to how I would deal on the community's behalf 
in advising the President and others, I've actually had that 
opportunity in the past on some particular issues. I was even 
able on at least one occasion to suggest to the President there 
were laws he could not suspend. These were the laws of physics. 
But the point is, I think I have a reputation here with the 
Congress and with the Administration of being straight in what 
I say and bringing integrity when I come to see you.
    Senator Whitehouse. The other piece of the problem is on 
the performance accountability side. In my area, we had the Big 
Dig which was a tunnel project near Boston that was a huge 
catastrophic disaster and provided immense news opportunities. 
When something goes wrong like that in the intelligence 
community, because it is covert, there are not those immense 
news opportunities. People don't see how badly things have gone 
off the rails. And indeed both the contractor who has failed or 
fouled up the program and their Government managers have every 
incentive to paper it over and have it go away so that nobody 
notices. But as you know, there are fantastic, spectacular 
amounts of money at stake here.
    Will you be fully supportive of our efforts in oversight in 
this respect, including the deployment of what we call TAG 
groups into areas where we are really the only oversight that 
these programs get?
    Dr. Kerr. Absolutely. And in fact, in past years I have 
worked with members of earlier TAG groups. Ofttimes they 
include people with whom I've had professional experience in 
the past. I have no problem at all expecting to do that in the 
future.
    Senator Whitehouse. I could not agree more with the 
concerns expressed by Senator Nelson about particular programs 
that we should probably discuss more in a classified setting. I 
want you to know that many weeks ago I asked for an explanation 
of what consequences had been applied in those circumstances. I 
gather that, because of our recent conversation in our office, 
I've received a classified letter for the first time this 
morning. But the question that I asked weeks ago in an open 
Committee hearing I've never received a response to.
    So you know, once again, I hope that you--in your role-- 
when you walk away from a Committee hearing with questions, 
somebody's actually tasked to get the answer back because this 
doesn't seem to be a very difficult question. You were actually 
able to answer it almost spontaneously when we met, and yet for 
weeks nobody got back to me on this question. And I think this 
question of performance accountability for contractors in a 
covert environment where nobody knows and huge amounts of money 
are being spent and it's only our oversight that provides any 
check and balance in the system--it is really important that 
you get back to us.
    Dr. Kerr. Right. Well, I was glad that you asked me the 
question. And I, in fact, am responsible for what you received. 
I didn't know about the earlier request.
    Vice Chairman Bond. Thank you very much, Senator 
Whitehouse.
    Senator Feingold.
    Senator Feingold. Thank you, Mr. Chairman.
    Dr. Kerr, again, congratulations on your nomination. If you 
are confirmed you'll be coming to this position at a 
particularly critical moment.
    The country needs the DNI to ask hard questions about the 
value, legality, and morality of our intelligence programs and 
to ensure that our intelligence is accurate, candid, and free 
of any politicization, and that's not an easy task at any time, 
but particularly in this Administration. But that is what is 
expected of the DNI and his Deputy. Of course, we also expect 
you to level with the Congress, a topic that you and I 
discussed yesterday.
    Let me ask you, Doctor, do you agree that intelligence 
activities that have implications for our foreign policy must 
be briefed to the full Committee?
    Dr. Kerr. Just to recall our conversation of yesterday, 
Senator Feingold, you made clear your membership here as a 
crossover member from Foreign Relations, and one of the points 
I tried to make was that ofttimes one of the foreign policy 
tools available to the United States is the intelligence 
community through liaison relationships and other things. My 
answer to that is I think those responsible for the oversight 
of U.S. foreign policy need to understand both the front 
channel and the back channel--what's going in both of them, 
what's capable of being done--in order to provide proper 
oversight of our foreign policy execution.
    Senator Feingold. And in this context you're referring 
obviously to the full Committee?
    Dr. Kerr. Correct.
    Senator Feingold. And so this would be particularly 
relevant to covert action, wouldn't it?
    Dr. Kerr. I think it would be applicable to covert action. 
I think generally the full Committee needs to know about covert 
action programs, and the only caveat I would add there is that 
which is present in the law and really refers to those special 
cases where lives are at risk or other very delicate things are 
hanging in the balance and where it might be left to the so-
called Gang of Eight.
    Senator Feingold. And in fact, the only provision in the 
National Security Act that allows for the so-called limited 
Gang of Eight notifications applies to covert action, and, as 
you've indicated, that can never be license to limit 
information that has implications for our foreign policy. So if 
confirmed will you review covert actions or any other 
intelligence activities that may have been limited to the Gang 
of Eight to ensure that the provision is not being abused?
    Dr. Kerr. I will.
    Senator Feingold. Doctor, do you believe that the laws that 
apply to elements of the intelligence community are binding and 
cannot be overridden by assertions of Article II authority?
    Dr. Kerr. Article II, as I understand it, refers to the 
role of the President as Commander-in-Chief and the 
responsibilities he has for the military services and the 
Defense Department as a consequence. Some of the intelligence 
agencies are not, in fact, part of the Defense Department and 
so they would not fall within the ambit of the Commander-in-
Chief designation. They would, in fact, be agencies of the 
Federal Government and subject to the laws and regulations that 
apply.
    Senator Feingold. But in any event do you believe that the 
laws that apply to the elements of the intelligence community 
cannot be overridden by assertions of Article II authority?
    Dr. Kerr. I'm not a constitutional scholar, as I'm sure you 
recognize, but I don't know of any exceptions to the law that, 
in fact, any military or civilian employee of the Government is 
entitled to.
    Senator Feingold. So can you think of any laws that apply 
to the intelligence community that you believe intrude on the 
President's authorities?
    Dr. Kerr. No, I don't.
    Senator Feingold. No?
    Dr. Kerr. I don't know of any.
    Senator Feingold. Doctor, as Deputy DNI you'll be 
conducting oversight of an intelligence community whose 
activities under this Administration have been justified 
sometimes by what I consider to be and others consider to be 
outlandish legal theories on issues such as electronic 
surveillance and interrogation. Even worse, Philip Zelikow, who 
was counsel to the State Department until last year, has 
written that those dubious legal theories have substituted for 
moral and policy deliberations. In other words, what some 
lawyer says the Administration can do precludes consideration 
of what it should do.
    In my view, the DNI, through its oversight role, can help 
reverse this disastrous practice by insisting that our 
intelligence activities are truly in America's interest. One 
such issue is the DNI's oversight of the implementation of the 
President's new Executive order on interrogations. I have 
opposed the Administration's policies in this area on legal 
grounds, but also because they have damaged our long-term 
efforts to mobilize our friends and isolate our enemies in the 
fight against al-Qa'ida. Doctor, as Deputy DNI, how will you 
ensure that these strategic issues are given appropriate 
weight?
    Dr. Kerr. I think the fundamental commitment that DNI 
McConnell and I would both bring to this is that we do 
understand the responsibilities we have under the Constitution, 
under the law, and, in fact, the need to secure the liberties 
for our people. I would, in fact, try to be very diligent in 
understanding not only the specific legal argument advanced for 
a course of action, but try to understand it in a broader 
context of what the likely effect would be of that course of 
action.
    Senator Feingold. I think that's terribly important and is 
exactly what you should be doing because, again, simply because 
something can be done by the executive branch, even if that's 
right, does not mean it's in the best interests of this 
country. Thank you, Mr. Chairman.
    Vice Chairman Bond. Thank you very much, Senator Feingold 
and Senator Whitehouse. We appreciate very much your staying 
with us.
    There are a number of things going on that I believe I and 
other Members have to attend, so I'm going to propose that the 
classified questions be submitted in classified form to the 
witness and ask that he respond to them in a classified manner, 
and I'd also say you've seen we have some healthy disagreements 
on policy on this Committee and I would also say that I used to 
be a lawyer and I don't read the President's Article II powers 
as confined to the Defense Department, if that was the gist of 
it. So fortunately, neither one of us is called on to be 
counsel to advise either the President or this Committee, so we 
will leave those subjects to perhaps people with more active 
and current knowledge of the law. With that, I thank the 
witness and the Members and declare this hearing adjourned. 
Thank you very much, Doctor.
    Dr. Kerr. Thank you, Mr. Chairman.
    [Whereupon, at 3:50 p.m., the Committee adjourned.]
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