    [Senate Hearing 118-688]
    [From the U.S. Government Publishing Office]

                                                            S. Hrg. 118-688

                               WORLDWIDE THREATS

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

                                    HEARING

                                   BEFORE THE

                          COMMITTEE ON ARMED SERVICES
                              UNITED STATES SENATE

                        ONE HUNDRED EIGHTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                  MAY 2, 2024

                                   __________

             Printed for the use of the Committee on Armed Services

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

                     Available via: http://www.govinfo.gov

                                   __________

                       U.S. GOVERNMENT PUBLISHING OFFICE
    60-835 PDF                  WASHINGTON : 2025

    -----------------------------------------------------------------------------------

                          COMMITTEE ON ARMED SERVICES

                         JACK REED, Rhode Island, Chairman

    JEANNE SHAHEEN, New Hampshire		ROGER F. WICKER, Mississippi
    KIRSTEN E. GILLIBRAND, New York		DEB FISCHER, Nebraska
    RICHARD BLUMENTHAL, Connecticut		TOM COTTON, Arkansas
    MAZIE K. HIRONO, Hawaii			MIKE ROUNDS, South Dakota
    TIM KAINE, Virginia			JONI ERNST, Iowa
    ANGUS S. KING, Jr., Maine		DAN SULLIVAN, Alaska
    ELIZABETH WARREN, Massachusetts		KEVIN CRAMER, North Dakota
    GARY C. PETERS, Michigan		RICK SCOTT, Florida
    JOE MANCHIN III, West Virginia		TOMMY TUBERVILLE, Alabama
    TAMMY DUCKWORTH, Illinois		MARKWAYNE MULLIN, Oklahoma
    JACKY ROSEN, Nevada			TED BUDD, North Carolina
    MARK KELLY, Arizona                  	ERIC SCHMITT, Missouri

    		    Elizabeth L. King, Staff Director
      		John P. Keast, Minority Staff Director

                                      (ii)

                             C O N T E N T S

    _________________________________________________________________

                                  may 2, 2024

                                                                       Page

    Worldwide Threats................................................     1

                               Member Statements

    Statement of Senator Jack Reed...................................     1

    Statement of Senator Roger Wicker................................     3

                               Witness Statements

    Haines, The Honorable Avril D., Director of National Intelligence     4

    Kruse, Lieutenant General Jeffrey A., USAF, Director of Defense       8
      Intelligence Agency.

    Questions for the Record.........................................    41

                                   Appendix A

    Submitted Statement of The Honorable Avril Haines--Annual Threat     47
      Assessment of the U.S. Intelligence Community.

                                     (iii)

                               WORLDWIDE THREATS

                                  ----------

                             THURSDAY, MAY 2, 2024

                                  United States Senate,
                                   Committee on Armed Services,
                                                        Washington, DC.
        The Committee met, pursuant to notice, at 9:30 a.m. in room
    SH-216, Hart Senate Office Building, Senator Jack Reed
    (Chairman of the Committee) presiding.
        Committee Members present: Senators Reed, Shaheen,
    Gillibrand, Blumenthal, Hirono, Kaine, King, Warren, Peters,
    Rosen, Wicker, Fischer, Cotton, Rounds, Ernst, Cramer, Scott,
    Tuberville, Mullin, Budd, and Schmitt.

                 OPENING STATEMENT OF SENATOR JACK REED

        Chairman Reed. Good morning. The Committee meets today to
    receive testimony on the global threats facing the United
    States and our international partners. I would like to welcome
    our witnesses, Director of National Intelligence (DNI) Avril
    Haines, and Director of Defense Intelligence Agency, Lieutenant
    General Jeffrey Kruse.
        I would take a moment to recognize that this is General
    Kruse's first posture hearing before the Committee. Thank you
    both for joining us, and please convey the Committee's
    gratitude to the men and women of the Intelligence Community
    (IC) for their critical work.
        Over the past several months, this Committee has received
    testimony from nearly every Military Department, Armed Service,
    and Combatant Command about the threats they face. As they have
    testified and as the DNI's Annual Threat Assessment has made
    clear, these challenges are evolving quickly. China, Russia,
    Iran, and North Korea seek to undermine, if not outright
    challenge, the United States' interest and leadership in the
    world. I am encouraged that many of these threats are
    addressed, in part, by the National Security Supplemental that
    Congress passed 2 weeks ago. This bill was long overdue, but we
    cannot overState its importance.
        Even in our most conflicted moments the world looks to the
    United States for leadership. Our allies rely on us for
    fortitude, and our adversaries hope for us to falter. By
    finally passing the National Security Supplemental, Congress
    sent a powerful message to the world. The legislation
    demonstrates that we stand resolutely with our allies and
    partners and that America's interests and safety will not be
    challenged by dictators or bullies.
        For the Ukrainians, the bill would provide critical
    weapons, ammunition, and combat vehicles to revitalize their
    heroic fight for freedom. Vladimir Putin must be stopped, both
    for the safety of Ukraine's survival and the security of all
    Americans. As the Annual Threat Assessment warns, Putin has
    repeatedly said that if he succeeds in Ukraine he intends to,
    quote, ``reunify other former Soviet states.'' This would
    almost certainly involve direct military conflict with a NATO
    [National Atlantic Treaty Organization] country, requiring the
    United States to send our own men and women into harm's way.
        Director Haines, General Kruse, I would ask for your
    assessment of the Ukraine conflict in the larger context of the
    evolving international order. I hope you will also address the
    extent to which Russian and Chinese efforts are aligning under
    their so-called no-limits partnership, and potential
    implications for United States national security.
        As we know, China is watching us closely, and the
    supplemental aid package will serve as an important deterrent
    to President Xi's aggressive ambitions in the Indo-Pacific and
    around the world. For several decades, the People's Liberation
    Army (PLA) has studied the United States' way of war and
    focused its efforts on countering our advantages. China has
    invested in offsetting technologies like anti-access and aerial
    denial systems, artificial intelligence (AI), hypersonics, and
    of course, nuclear weapons.
        Further, China has leveraged a combination of military and
    civil power against its neighbors, including statecraft,
    economic pressure, coercion, and deception. Beijing has sought
    ways to achieve its national objectives while avoiding a direct
    confrontation with the United States military.
        Just as Chinese leaders have studied our way of war, we
    need to study theirs. With that in mind, I would ask our
    witnesses for their assessment of how China is evolving its
    competitive strategies and objectives. I would also appreciate
    an update on what military and non-military factors are most
    likely to impact Chinese decision-making, with respect to
    potential coercive actions against Taiwan and other regional
    partners.
        Finally, in the Middle East I am concerned that we are
    facing a uniquely dangerous moment. With Israel and Hamas
    engaged in a violent conflict in Gaza, Iran is seeking to
    exploit the chaos as an opportunity to force the United States
    out of the region. Iran appears to have calculated the best
    strategy to achieve this is by directing its proxy forces to
    attack American, Israeli, and allied interests in the Middle
    East.
        The Iranian-linked Houthi rebels in Yemen have launched
    hundreds of drones and missile attacks against United States
    and international vessels in the Red Sea, and even further,
    disrupting nearly 15 percent of global commercial trade,
    driving up costs and inflation around the world. The National
    Security Supplemental will equip United States Forces with the
    resources they need to protect our servicemembers and
    international shipping lanes and will help Israel defend itself
    from vicious attacks from Iran, Hamas, and other violent
    groups.
        Just as importantly, it will provide critical humanitarian
    aid to Palestinians caught in the crossfire. I would appreciate
    our witnesses' perspectives on these complex challenges.
        Thank you again to our witnesses. I look forward to your
    testimony.
        As a reminder for my colleagues, there will be a closed
    session immediately following this hearing in room SVC-217.
        Now let me turn to Ranking Member Wicker.

                   STATEMENT OF SENATOR ROGER WICKER

        Senator Wicker. Thank you very much, Mr. Chairman. Today's
    hearing is a chance for the Committee to hear the Intelligence
    Community's assessment of the many threats that our country
    faces. I regularly hear from our Nation's top uniformed and
    civilian personnel. Their testimony makes it clear to me that
    the United States faces a troubling threat environment and that
    the situation urgently requires American leadership.
        Armed conflict is raging in multiple theaters. Regional
    instability is on the rise. Violent Islamic terrorism is
    expanding. Several of our principal adversaries are deepening
    their cooperation, forming a new axis of evil and striving to
    reshape the geopolitical order.
        We have reached a pivotal moment in history. The decisions
    we make this year will have far-reaching implications for our
    national security.
        It is disturbing to me that the Intelligence Community
    seems unable to give our national security officials or the
    American public an answer about the size of the Chinese defense
    budget. That said, we do know that our principal adversary,
    Communist China, has announced another 7.2 percent increase to
    its defense budget for 2024. I would like our witnesses to
    articulate a plan for how they will answer this question, a
    plan that involves more than one full-time analyst working on
    the problem, as is currently the case.
        No matter the exact size of the Chinese budget, we see with
    our own eyes, in public and in classified settings, the scope
    and scale of the Chinese military modernization. If we hope to
    maintain deterrence or win a fight, we will need the military
    and the Intelligence Community to work more closely together
    than they ever have. To that end, I would like to understand
    what specific policies the Intelligence Community has changed
    to enable a more effective targeting process for the military.
        Beijing is leading that increasingly integrated axis of
    countries bent on undermining United States' interest. This new
    alignment of cooperation among China, Russia, Iran, and North
    Korea is a greater menace than we have faced in decades. I do
    not believe the American people have a sufficient understanding
    of the danger. Many of us do not know the ways in which these
    adversaries are working together to make Americans, our allies,
    and our partners less safe. I hope our witnesses can comment
    with specific examples about this new threat.
        The national security supplemental that Congress passed
    last week is an important and historic step in the right
    direction, as the Chairman just stated. It was necessary, but
    it is insufficient. We have much more work to do to restore our
    industrial base to a wartime footing, to strengthen our allies,
    and to get innovative technologies into the hands of our
    servicemembers. We do all of this because we hope to prevent a
    war from ever coming to pass.
        So I thank our witnesses for their service to the country
    and for being with us today. Thank you.
        Chairman Reed. Thank you, Senator Wicker. Director Haines,
    please.

        STATEMENT OF THE HONORABLE AVRIL D. HAINES, DIRECTOR OF
                         NATIONAL INTELLIGENCE

        Director Haines. Thank you very much, Chairman Reed,
    Ranking Member Wicker, and members of this Committee. Thank you
    for the opportunity to be here alongside my wonderful
    colleague, General Kruse, the Director of the Defense
    Intelligence Agency, to present the IC's Annual Threat
    Assessment.
        Before I start I want to thank publicly the people of the
    Intelligence Community, from the collector to the analyst and
    everybody in between. We are presenting the result of their
    labor at this hearing. They work tirelessly every day to
    support our military, to keep our country safe and prosperous,
    and we are proud to represent them.
        Today the United States faces an increasingly complex and
    interconnected threat environment characterized by really three
    categories of challenges. The first is an accelerating
    strategic competition with major authoritarian powers that are
    actively working to undermine the rules-based order and the
    open international system, which the United States and our
    partners rely on for trade, for commerce, and for the free flow
    of information.
        The second category is a set of more intense and
    unpredictable transnational challenges such as cybersecurity,
    terrorism, climate change, narcotics trafficking, and health
    security that often interact with traditional state-based
    political, economic, and security challenges.
        The third category is made up of regional and localized
    tensions, including those that have erupted into full-blown
    conflicts, with far-reaching and at times cascading
    implications, not just for neighboring countries but globally.
    All three categories are affected by trends in new and emerging
    technologies, environmental changes, and economic strain that
    is stoking instability, making it that much more challenging
    for us to forecast developments and their implications.
        The report we have issued goes through the threats we see
    in all three categories as they intersect with these key
    trends, giving you a sense of the IC's baseline assessments of
    the most pressing threats to U.S. national interests.
        Rather than attempt to summarize the report here I will
    just touch on some of the issues that I know are top of mind,
    starting with the PRC's [People's Republic of China] outlook
    this year, then provide a brief update on Russia's invasion of
    Ukraine, the conflict in Gaza, and the scale and scope of
    cyberattacks that we are currently monitoring.
        With respect to the PRC, President Xi and his senior
    leadership expect some degree of future instability in the
    bilateral relationship with the United States, and they
    continue to believe that the United States is committed to
    containing China's rise and undermining the party's rule. They
    also perceive value in projecting stability in the relationship
    this year, particularly from a domestic economic perspective,
    which is their main priority.
        We assess that the PRC's leadership recognizes the
    productivity, debt, demographic demand challenges that China's
    economy is facing. Rather than looking to stimulate consumer
    spending or adopting more investment-friendly approaches,
    President Xi appears to be doubling down on a long-term growth
    strategy powered by manufacturing strength and technological
    innovations that will almost certainly deepen public and
    investor pessimism over the near term.
        President Xi is counting on China's investments in
    technology, such as advanced manufacturing and robotics,
    artificial intelligence, and high-performance computing to
    drive productivity gains and spur growth in the future. Yet he
    is increasingly concerned about the United States' ability to
    interfere with China's technological goals.
        Consequently, PRC leaders modified their approach to
    economic retaliation against the United States over the last
    year, imposing at least some tangible costs on United States
    firms. We remain of the view, though, that in the coming months
    they are likely to limit the level of economic retaliation they
    engage in, in order to avoid the domestic costs of such
    actions. In particular, the significant decline in foreign
    direct investment in China, down 77.5 percent in 2023, is
    likely to prompt the PRC to be more measured in their responses
    absent an unexpected escalation by the United States. Rather
    than engaging in direct economic retaliation that might result
    in such negative domestic economic consequences, the PRC's
    tactics are evolving to promote an increasingly sophisticated
    exploitation of loopholes, avoid detection, engage in
    stockpiling.
        Moreover, the PRC also remains focused on achieving its
    regional and global ambitions, which warrants, from their
    leadership's perspective, a strategy to boost China's
    indigenous innovation and technological self-reliance, supports
    efforts to acquire, steal, or compel the production of
    intellectual property and capabilities, and controls critical
    global supply chains that provide the leverage to achieve
    certain geopolitical outcomes to their advantage.
        Furthermore, given its ambitions, Beijing will continue to
    use its military forces to intimidate its neighbors and to
    shape the region's actions in accordance with the PRC's
    priorities, most obviously in relation to Taiwan as the PRC
    presses for unification. We expect the PLA will field more
    advanced platforms, deploy new technologies, grow more
    competent in joint operations, and seek to strengthen their
    nuclear forces and cyber capabilities will also seeking to
    divide us from our allies in Europe and in the Indo-Pacific.
        In the meantime, China is working to develop its own form
    of multilateralism while deepening its relationship with Russia
    and Iran, in particular. In fact, China's provision of dual-use
    components and material to Russia's defense industry is one of
    several factors that tilted the momentum on the battlefield in
    Ukraine in Moscow's favor, while also accelerating a
    reconstitution of Russia's military strength after their
    extraordinarily costly invasion.
        When it comes to Ukraine, we assess that President Putin
    thinks that domestic and international trends are in his favor.
    Russia is making incremental progress on the battlefield with
    the potential for tactical breakthroughs along the front lines
    in areas such as Donetsk and Kharkiv. Publicly, Putin touts his
    ammunition and missile production capacity in contrast with
    what he portrays as significant United States, European, and
    Ukrainian limitations. He likely views his position based on
    Russia's economic trajectory, rearmament efforts, and his
    political staying power as advantageous compared with the
    challenges facing the Ukrainians, including the hard fight here
    and in Europe for continued support for Ukraine.
        Like Ukraine, Putin has, for months, indicated a
    willingness to enter into talks with Ukraine and the United
    States about the future for Ukraine, but without any indication
    that he is willing to make significant concessions. Putin's
    increasingly aggressive tactics against Ukraine, such as the
    strikes on Ukraine's electricity infrastructure, are intended
    to impress on Ukraine that continuing to fight will only
    increase the damage to Ukraine and offer no plausible path to
    victory.
        By targeting critical infrastructure, Moscow aims to create
    logistical hurdles that impede Ukraine's ability to move forces
    and supplies to the front, slow Ukrainian defense production,
    and build pressure for Kiev to consider pathways out of the
    war, including through negotiations. These aggressive tactics
    are likely to continue, and the war is unlikely to end any time
    soon.
        In fact, in a major change in fiscal policy, President
    Putin has increased defense spending to almost 7 percent of
    Russia's GDP, nearly double the historical average. The defense
    budget now accounts for roughly 25 percent of Federal spending
    in Russia. In many ways this is prompted by the fact that
    Russia has paid an enormous price for the war in Ukraine. Not
    only has Russia spent hundreds of billions of dollars,
    suffering more military losses than in any time since World War
    II, with more than 300,000 casualties, but the war precipitated
    Finland's and Sweden's membership in NATO, which Putin believes
    requires an expansion of Russia's ground forces. Putin
    continues to judge that Russia is under threat and almost
    certainly assumes that a larger, better-equipped military will
    drive that point home to Western and domestic audiences.
        Putin's strategic goals also remain unchanged. He continues
    to see NATO enlargement and Western support to Ukraine as
    reinforcing his long-held belief that the United States and
    Europe seek to restrict Russian power. In turn, he has tried to
    capitalize on global events such as the outbreak of the
    conflict between Israel and Hamas, to divide us from our
    allies.
        The crisis in Gaza is another striking example of how a
    localized conflict can produce global impact. Nearly 7 months
    in, the Gaza conflict has roiled the Middle East, presenting
    new security paradigms and humanitarian challenges while
    pulling in a range of actors. Most prominently, there was the
    unprecedented level of attacks between Iran and Israel, with
    Iran and its proxies launching hundreds of weapons toward
    Israel in response to Israel's killing of Iranian officials in
    Damascus. Additionally, cross-border attacks along Israel's
    northern border with Lebanon continue at a pace and intensity
    that is controlled but has the potential to escalate, even as
    we continue to assess that Hezbollah does not want the
    situation to develop into an all-out war with Israel and the
    United States.
        As of last week, the Houthis resumed nearly daily maritime
    attacks after announcing last month that they intend to
    escalate strikes and expand their hostile actions to the Indian
    Ocean. Meanwhile, Iranian-aligned militia groups in the region
    continue to plan attacks against our forces, but have broadly
    paused conducting such attacks, though it is not clear how long
    that pause will last.
        Moreover, the crisis has galvanized violence by a range of
    actors around the world. Both al Qaeda and ISIS, inspired by
    Hamas, have directed supporters to conduct attacks against
    Israel and United States interests, demonstrating yet again the
    degree to which so many threat streams have system effects.
        Finally, I will just end by talking about the increasing
    challenge associated with one of our most pernicious
    transnational threats, cyberattacks. We have seen a massive
    increase in the number of ransomware attacks globally in the
    last year, which went up as much as 74 percent in 2023. U.S.
    entities were the most heavily targeted, with attacks against
    the health care sector roughly doubling what they had been the
    year before.
        Moreover, this year cyber actors are attacking U.S.
    industrial control systems, which are typically used to
    automate industrial processes at record levels. Many critical
    infrastructure sectors, including water and wastewater, food,
    and agriculture, defense, energy, and transportation rely on
    such systems. Although the likelihood of any single attack
    having a widespread effect on interrupting critical services
    remains low, the increased number of attacks and the actors'
    willingness to access and manipulate these control systems
    increases the collective odds that at least one could have a
    more significant impact.
        In virtually all of the attacks we have seen against U.S.
    critical infrastructure, cyber actors took advantage of default
    or weak passwords, unpatched known vulnerabilities, and poorly
    secured network connections to launch relatively simple
    attacks. For this reason it is crucial that all of us,
    particularly critical infrastructure owners and operators,
    improve our cybersecurity practices to reduce our vulnerability
    to such efforts.
        State actors, of course, can use more sophisticated
    capabilities to more reliably cause greater disruptions by
    breaching better-defended targets, resulting in, for example,
    multiple failures at once. State actors, however, also tend to
    recognize their own vulnerabilities, and are unlikely to engage
    in attacks on critical infrastructure unless they are at war.
    Instead, these actors put a premium on preparing offensive
    capability basically during peacetime, in part by preemptively
    planting footholds in our infrastructure. What is often the
    case, particularly in the context of ransomware attacks, is
    that we are dealing with unaffiliated cyber actors focused on
    obtaining money, power, or hacktivists who seek notoriety for
    specific causes.
        There are, of course, so many threats and scenarios that I
    have not covered in my opening remarks, but I hope we can do so
    when we get to your questions. Most of all, thank you for your
    support for the Intelligence Community's work and also for the
    work on 702 reauthorization. We very much appreciate it. Thank
    you.
        [The prepared statement of The Honorable Avril D. Haines
    follows:]
        Please see Appendix A for The Honorable Avril D. Haines
    prepared statement.
        Chairman Reed. Thank you very much, Director. General
    Kruse, please.

        STATEMENT OF LIEUTENANT GENERAL JEFFREY A. KRUSE, USAF,
                DIRECTOR OF DEFENSE INTELLIGENCE AGENCY

        General Kruse. Chairman Reed, Ranking Member Wicker, and
    distinguished members of this Committee, thank you for the
    opportunity to join Director Haines in presenting our
    assessment of the global security environment. I would like to
    streamline my opening comments this morning first by echoing
    the DNI's overall assessments in her remarks as well as her
    thanks to the men and women of the Intelligence Community.
        The Defense Intelligence Agency alone has officers in more
    than 140 nations around the globe, and we are joined by
    thousands more from across the 18 members of the IC. With your
    support they are world class in their commitment and their
    results, and it is a privilege to represent them and their work
    before the Committee.
        The national security arena's complexity, trajectory, and
    rate of change is perhaps the highest and most consequential we
    have seen in several decades. How we respond matters, and our
    level of innovation, focus, and integration must equal or
    outpace that of our adversaries. In this vein I would offer
    three overarching themes beyond what the DNI has already
    mentioned, that are the most concerning to me as the Director
    of the Defense Intelligence Agency.
        First is that while individually threats are growing,
    whether specific countries or rapid growth in malign use of
    advanced technology, artificial intelligence, biotechnology,
    unmanned systems, or cyber, there are a growing number of
    adversaries who are interacting and partnering in ways, and
    toward ends, that we have not seen before. Historical friction
    points are no longer governing their relationships, and the new
    resulting partnerships are still nascent and untested, meaning
    how we predict and shape their trajectory is nascent and
    untested, as well.
        Second, while much of our collection, our analysis, our
    modernization, and our engagements are laser-focused on near
    and midterm issues and impacts in Ukraine, the Indo-Pacific,
    and the Middle East, the long-term trajectory in these regions
    and the impacts on the United States are equally troubling and
    perhaps even more far-reaching. For example, how events in
    Ukraine play out in the months ahead will be critical and will
    impact how Russia emerges, postured and emboldened for
    potential future conflict with its neighbors, including NATO.
        Similarly, the Chinese Communist Party's national and
    military plans are not solely focused on Taiwan and the South
    China Sea in the 2020's, but also on securing an entirely new
    place for the People's Republic of China throughout the 2030's
    and the 2040's. These ambitions and their associated military,
    space, cyber, and nuclear expansion to entice or compel
    outcomes are at the expense of their neighbors, the region, the
    United States, and the open international system.
        In the Middle East, as mentioned, how the current conflict
    between Hamas and Israel is resolved is likely to determine
    regional dynamics for decades.
        Consequently, how we view and adequately prepare for these
    longer-term outcomes is a near-term issue, with near-term
    actions required.
        Then finally the third issue is our unquestionable need to
    protect our networks, our data, and our people from the
    pervasive threat of cyber actors, foreign intelligence
    entities, and insider threats. This includes not only the
    sophisticated capabilities of State actors, such as Russia and
    China, but also rogue cyber actors loosely aligned to
    governments.
        In addition to what Director Haines has already stated on
    the growing threat to critical infrastructure and local
    governments, this threat directly endangers our defense
    industrial capabilities, our hard-won technological and
    military advantages, our allies and partners, and our future
    defense operations. We must partner, invest, and integrate in
    new ways to secure what we value and safeguard the assured
    resiliency of our networks, the data, and the people.
        Thank you for the opportunity to appear before the
    Committee today. We are grateful for the Committee's
    longstanding partnership and support, and I look forward to
    your questions.
        Chairman Reed. Thank you very much, General.
        For both the Director and the General, the Intelligence
    Community, I believe, and correct me if I am inaccurate,
    concluded that Iran was not aware prior to the attack by Hamas
    of the operation, but they seem to be exploiting it
    significantly by using their proxies throughout the region. As
    you pointed out, Director Haines, our retaliation in September,
    82 different strikes, has at the moment inhibited many of their
    proxies. Still, the Houthis are conducting operations.
        Can you give me an assessment of the Iranian strategy? Is
    it reactive or proactive? Are they trying to organize a
    decisive victory, or are they simply reacting to what is going
    on, or trying to take advantage of what is going on?
        Director Haines. Thank you so much, Chairman. I think
    really it is a combination of all of those things, which is to
    say that even though we do not assess that they were aware of
    the particular attack at the moment that it occurred, in the
    way that it did, they obviously have been supportive of Hamas
    in the past, have provided funding and training and other
    assistance of different types, and the reality is that, in many
    ways, they support efforts to counter Israel, as we have seen.
    They see Israel as their enemy, and they have long done so.
        So as things have developed I think they are taking
    advantage of every opportunity to ultimately try to undermine
    the State of Israel, in many respects. So that is certainly
    part of what they are doing.
        It is also, I think, true that they are looking to take
    advantage of opportunities to enhance their influence in the
    region, and that is something that, again, they have long
    worked on, whether it is through the Iranian-aligned militia
    groups that we are all aware of in the region or through their
    relationship with the Houthis, or through their relationship
    with Hamas, and, of course, one of their closest partners,
    Hezbollah.
        In supporting them, and in also increasing their influence
    there is a kind of a long-term strategy of trying to enhance
    that, including in countries like Iraq and so on.
        General Kruse may have more to add.
        Chairman Reed. General Kruse?
        General Kruse. I think I would just echo a couple of things
    that the DNI mentioned. One is that they have had a long-term
    strategy, over many decades, and they have been long-term
    suppliers and supporters of the groups already mentioned.
        Within that larger strategy, this conflict came into being
    and they have used every opportunity to take advantage of the
    circumstances. I would not call it necessarily reactive, but
    the ability to, within their larger construct, increase their
    influence and come out. At some point this conflict will end.
    Iran has gone through various sets of calculus over time about
    escalation or not escalating, and I think they are navigating a
    path by which they think they can create more influence within
    the region for the longer term environment that we will find at
    the end of the existing conflict.
        Chairman Reed. In looking at China you mentioned, both
    Director Haines and General Kruse, are trying to use their
    economic powers throughout the world's supply chains, and that
    seems to be the particular case with strategic minerals. Do you
    see us in a fight, quote/unquote, over securing adequate
    strategic minerals? These are essential to batteries and other
    things that could be the source of power in the next
    generation.
        Director Haines. Yes, absolutely. I mean, one way to think
    about this is as follows. They have used rare earth elements
    and critical minerals as a leverage point for achieving
    geopolitical outcomes in different spaces, because I think they
    both recognize their capacity with respect to mining and
    processing is significant, and it gives them the ability to
    sort of move forward on a plan for how do we control the global
    supply chains in these areas, and recognizing that these are
    incredibly important to the prosperity of many economic futures
    for different countries. Moving forward they have seen the
    ability to use that, again, as a leverage point.
        What we have seen in this area, and I think their sort of
    history is a useful lesson in this, which is to say that they
    have actually passed laws, dating back decades now even, for
    being able to control the rare earth elements. We saw them
    actually use this first in the context of a dispute with Japan
    over the Senkaku Islands, where they ultimately used their
    leverage there by cutting off exports that were important to
    Japan's economy at the time, as a way of pressuring them in the
    context of a land dispute and a maritime dispute.
        So I think that is an example of what we have seen. We have
    also seen them pass export controls of gallium and uranium more
    recently and other things that are important, and again, using
    this as a leverage point. I think what we have been trying to
    do is try to help policymakers understand how they are
    approaching this, where they are getting close to having
    control over a critical supply chain, and then being able to
    highlight opportunities for trying to disrupt that so that we
    can maintain resilience in these areas.
        Chairman Reed. Thank you. No need for a response unless I
    am inaccurate, but one the key advantages is they do a
    tremendous amount of refining, so these minerals could be--in
    fact, I think Australia has a huge cache of these minerals, but
    the refining is all done in China, and that is the choke point.
        Director Haines. Yes, lithium is a good example of this.
        Chairman Reed. Senator Fischer, please.
        Senator Fischer. Thank you, Mr. Chairman, and thank you
    both for being here today.
        Director Haines, in the 2024 Annual Threat Assessment it
    stated that if Beijing believed that a major conflict with the
    United States were imminent it would consider aggressive cyber
    operations against U.S. critical infrastructure and military
    assets. Such a strike would be designed to deter U.S. military
    action by impeding U.S. decision-making, inducing societal
    panic, and interfering with the deployment of U.S. Forces.
        In your opening comments you mentioned how Chinese cyber
    actors are currently working to disrupt and destroy some of our
    critical infrastructure, putting things in place for future
    possibilities of using that. In this setting, can you provide
    us with any examples of this type of malign cyber activity?
        Director Haines. Yes. I think just to be precise, but I
    think consistent with what you just said, what we see is both
    China and Russia effectively trying to pre-position themselves
    in ways that would allow them to conduct those kinds of
    attacks, not actually yet necessarily engaging in those
    attacks, and obviously we can discuss this further in a closed
    session.
        I can get back to you. I think we do have one or two
    examples that we have declassified of where they have tried to
    produce such footholds, essentially, in infrastructure. So I
    will do so in a followup.
        Senator Fischer. Okay. Does the Intelligence Community work
    at all with our utility companies and others so that you can
    increase awareness about the possibility of attacks and how
    these companies can work with you to help mitigate their
    vulnerability?
        Director Haines. Yes. We do so largely through, for
    example, CISA [Cybersecurity and Infrastructure Security
    Agency] for cybersecurity related to critical infrastructure,
    but we are very heavily working with them to ensure that they
    are able to provide the kind of warnings that you are
    describing for critical infrastructure across the board. This
    is something that we spend quite a bit of time on, and as I
    indicated, we are seeing this sort of significant increase in
    attacks on control systems, which is so important to critical
    infrastructure. So much of our critical infrastructure relies
    on these types of automated control systems that are vulnerable
    to cyberattack.
        But again, sort of working through exactly the attribution
    chain of where those attacks are coming from is quite
    challenging, and that is something that we spend quite a bit of
    time on. Again, as I indicated, so many of those attacks are
    basically possible as a consequence of just not engaging in
    good cybersecurity practices--not updating passwords, not doing
    the kind of work that needs to be done, patching
    vulnerabilities that we are aware of. The Government will put
    out notices, essentially, about such vulnerabilities, and we
    really think it is crucial for folks to do those types of
    cybersecurity practices. Because if they did that, it actually
    would reduce the--yes, significantly.
        Senator Fischer. Right. Over the past several years we have
    watched as Russia and China, Iran, North Korea, they are
    rapidly expanding and modernizing their nuclear arsenals. They
    are also developing some really dangerous new capabilities that
    they can strike the United States with. It really can happen
    without much warning.
        Do we have any idea, General or Director, on how large of
    stockpiles these countries have and/or also what their
    intention is in future production?
        General Kruse. I think in this setting I would say yes, we
    have a great insight into a handful of the countries with good
    precision. There are a few countries where we have some ranges,
    and in the closed session we would be happy to share those with
    you, as well as their likelihood of delivery of those to the
    continental United States.
        Senator Fischer. Right now the United States provides a
    nuclear umbrella to our allies. They are dependent upon that,
    and I believe it limits nuclear proliferation around this world
    because of the confidence that our allies have in our umbrella
    that we provide them. Do you worry about our allies losing
    confidence in our ability to provide them with a strong
    deterrence when we see our adversaries continue to build at a
    breathtaking pace their nuclear capabilities?
        Director Haines. I will start. I mean, I think you are
    absolutely right that the nuclear umbrella that we provide is
    intended to ultimately counter proliferation of nuclear
    weapons. Whether or not we are seeing a degradation in our
    allies' confidence that we will be there in these
    circumstances, I would say it is not that I take it for
    granted, but rather that I think it is something that we have
    to continue to be very vigilant in working with our allies to
    ensure that they continue to have confidence in that nuclear
    umbrella in certain circumstances.
        I think there has been a fair amount of discussion about
    whether the Republic of Korea, for example, is particularly
    concerned, and given what they are seeing from the north, and
    whether or not they continue to have confidence in us being
    able to provide that nuclear umbrella versus their own
    particular, whether or not they should, in fact, engage in
    their own nuclear program. Our assessment at this stage is not
    that they are pursuing that at this point, even though we
    recognize it is an area of public conversation.
        General Kruse. I would just echo that having been assigned
    in the Indo-Pacific many times, with really some of the
    adversaries who present a threat and then some of our allies
    who engage in the dialog with us, is that they will
    occasionally, when we see a change in stockpile, have a great
    conversation with us. What you will see is that as long as we
    continue that dialog they are confident in the U.S. nuclear
    umbrella.
        I would offer as we think through this, sometimes it is not
    just the capacity. An increase in the numbers do not change the
    nuclear umbrella that the U.S. provides. It is really only when
    you get to changes in capabilities. Every conversation that we
    have had to date have been good, constructive conversations,
    and those will just continue.
        Senator Fischer. Thank you. Thank you, Mr. Chairman.
        Chairman Reed. Thank you, Senator Fischer.
        Senator Shaheen, please.
        Senator Shaheen. Good morning. Thank you both for being
    here.
        During the New Hampshire primary back in January we had a
    domestic actor who used artificial intelligence to voice clone
    President Biden's voice and to target voters on a roboscam in
    New Hampshire. Your threat assessment talks about how Russia is
    contemplating using electoral outcomes in 2024 to effect
    Western support for Ukraine. Both Russia and China are using AI
    to improve their capabilities to reach into Western audiences.
    You both mentioned that in your opening statements, that
    potential impact.
        So I have a couple of questions. First of all, are you able
    to share information with State and local officials when you
    see those kinds of AI or cyber-generated influence into what is
    happening in states? Director Haines?
        Director Haines. Yes, thank you. So yes, working with CISA,
    what we have been doing is, in fact, been trying to expand our
    capacity to do so, but we do have direct communication with
    them on basically deepfakes and other types of manipulated
    media.
        Senator Shaheen. Are our adversaries using AI platforms in
    the United States to conduct disinformation and spread
    propaganda?
        Director Haines. Yes, absolutely. Russia, in particular,
    has engaged in the use of artificial intelligence, generative
    AI in the context of their information operations. This is
    something that we have seen pretty consistently, and they are
    not the only ones.
        Senator Shaheen. To what extent are we seeing those kinds
    of efforts attempting to manipulate the unrest that we are
    seeing on college campuses?
        Director Haines. I do not have any information that
    suggests that they are doing this at this stage, but that does
    not mean that it will not develop over time.
        Senator Shaheen. Really? Because Rutgers had a report that
    looked at the back end of TikTok, which has now been closed
    off, that says that, in fact, the Chinese are manipulating
    through disinformation to populations who use TikTok to
    manipulate the situation in Gaza and spread misinformation. You
    are not seeing any of that, even though that has been publicly
    reported?
        Director Haines. Yes, that we are seeing with respect to
    the Gaza conflict. Apologies. I thought you talked about using
    that to instigate protests in the United States, and that is
    what we are not seeing. Does that make sense?
        Senator Shaheen. You do not consider the protests on
    campuses protests in the United States?
        Director Haines. I do. I am sorry. We are seeing
    misinformation/disinformation, and even true information, that
    is being exacerbated with respect to the Gaza conflict. It is
    not directed at protesters, so far as I am aware at this stage.
    Does that make sense? In other words, looking to direct
    protests.
        Senator Shaheen. I am not being clear, because there have
    also been public reports that particular Chinese sympathizers
    are funding some of these protests to exploit the situation in
    Gaza. I mean, that has been reported publicly for several
    months, and in fact, even the committee in the House that is
    looking at China, Mike Gallagher, has talked about this. So are
    we seeing that?
        Director Haines. I am not seeing information that indicates
    that the Chinese government is directing that. So that is the
    piece that----
        Senator Shaheen. Okay. I am sorry.
        Director Haines.--I do not see.
        Senator Shaheen. We do see Chinese sympathizers who are
    doing this.
        Director Haines. That is part of FBI pieces, was they are
    looking at what is happening within the United States, and I
    defer to them, and we can certainly get back to you on that
    question.
        Senator Shaheen. I can followup in the closed session.
        I also wanted to raise the concerns about renewed reporting
    that has again, as a result of work done by CBS 60 Minutes,
    that suggests that our adversaries could be behind the
    anomalous health incidents that have affected so many of our
    diplomats and servicemembers abroad. Are you rethinking how the
    intel community is looking at what has happened with those
    anomalous health incidents and thinking that maybe we should do
    a little more investigating about who is behind those?
        Director Haines. Thank you, Senator. We absolutely are
    continuing to investigate what is happening with anomalous
    health incidents, and we identified in our last, which is now a
    little over a year ago, Intelligence Community assessment a
    whole series of gap areas that we have to continue to work to
    ensure that we are collecting intelligence, making sure that we
    are, in fact, closing those gaps so that we can be more
    confident in our assessment but also to determine whether or
    not they undermine any of the basic assumptions that we make in
    those assessments, and so that has been a continued process,
    and will continue as a process. There is no question that we
    all see this as a very important and priority for the
    Intelligence Community.
        When we went back, obviously, after the 60 Minutes show we
    said, you know, is there anything here that changes our
    assumptions, our assessments. Our analysts took a very close
    look at it. The vast majority they say they had already
    actually known before the Intelligence Community assessment was
    issued, but there were new things since the Intelligence
    Community assessment that had come in. They still have not
    changed their basic assessments at this point, which is
    essentially that some elements think it is very unlikely, some
    think it is unlikely. They have various degrees of confidence
    as to whether or not a foreign actor is behind AHIs.
        That is something that we just have to continue to work at
    in order to make sure that we, in fact, have that right, and
    moreover, that there is not some further information that would
    be useful to us in understanding what is causing these.
        Senator Shaheen. Well, thank you. I appreciate that, and I
    hope you will report back to the Committee.
        Chairman Reed. Thank you, Senator Shaheen.
        Senator Rounds, please.
        Senator Rounds. Thank you, Mr. Chairman. Thank you to both
    of you for your service to our country and for your testimony
    here today.
        We live in what is perhaps the most complex, if not most
    dangerous, threat environment this Nation has had to deal with
    since World War II. Accurate intelligence assessments are
    crucial to our success in navigating these challenges.
        Director Haines, your Annual Threat Assessment points out
    the persistent threat of malign influence operations that are
    being conducted by Russia, China, and Iran. A host of our
    systems and platforms critical to our national security operate
    on the 3.1 to 3.45 gigahertz band of the spectrum, or the lower
    3G band. I know we are going to get into the weeds a little bit
    on this, but I just want to get, for public understanding, the
    seriousness of this particular issue.
        Are you aware of any, or of the Chinese efforts to
    encourage other nations to build out their 5G infrastructure on
    the 3.1 to 3.45 gigahertz portion of the spectrum?
        Director Haines. Let me come back to you on that question,
    sir.
        Senator Rounds. Okay. Let me ask it this way. Are you aware
    of any Chinese campaigns to encourage U.S. companies to push
    the Department of Defense to auction off their share of the
    lower 3 band of the spectrum?
        Director Haines. I should come back to you, just to be
    confident that I have it right, sir.
        Senator Rounds. Okay. I will skip the rest of the
    questioning along that line until later, okay. All right.
        Director Haines, based on the increasingly robust
    cooperation between China and Russia, is it fair to assume that
    if either one of them engaged in hostilities with the United
    States and our allies that it would increase the likelihood
    that the other would also initiate some form of hostilities, as
    well?
        Director Haines. Yes, we see China and Russia, maybe for
    the first time, exercising together in relation to Taiwan, and
    recognizing that this is a place where China definitely wants
    Russia to be working with them, and we see no reason why they
    would not.
        Senator Rounds. General Kruse, in your professional
    military opinion, is the Department taking into consideration
    this increased cooperation between Russia and China when it
    comes to identifying Joint Force requirements?
        General Kruse. I think the Department is concerned, has
    been for a while, and then what we have seen over the last 2
    years has caused the Department to relook at its analysis and
    become even more concerned about what our Joint Force
    requirements, in an environment where as discussed, we would
    anticipate. Even if Russia and China and a military force are
    not interoperable they would certainly be cooperative, and we
    would need to take that into account in force structure, in
    planning.
        Senator Rounds. I will just address this to both of you
    then. Have any of our plans been updated to reflect this ``no
    limits'' partnership between Russia and China?
        General Kruse. I think what I would say is from a
    departmental perspective our planning process is a multiyear
    processing, starting with what the threat looks like, and then
    how do we step through a fairly intensive vetting of what kind
    of operations we might want to conduct. For the plans that you
    are probably most interested in, we are in the middle of that
    revision today.
        Senator Rounds. Director Haines?
        Director Haines. Yes, and we have produced quite a bit of
    analytic materials, I think a lot of which you have read, that
    indicates this increasing cooperation in the ``no limits''
    partnership, as you say, but just across really every sector of
    society--political, economic, military, technological, and so
    on. So that is something that our understanding is prompting
    new planning across the Government in many respects.
        Senator Rounds. The bottom line is that basically if we
    were to have a conflict with one, that chances are we would
    have a second front, and that the planning that we have to do
    includes confrontation on not just one front now but the
    capabilities, the planning, the equipment, manpower, that would
    be necessary for two different fronts simultaneously. Am I
    correct?
        Director Haines. Yes, I think certainly it is a
    possibility. The question of just how likely it is I think
    differs depending on the scenario, which I am sure is obvious
    to you.
        Senator Rounds. A greater possibility now than what it was
    2 or 3 years ago, though.
        General Kruse. I think from the Department of Defense
    perspective that would certainly be the case, and it just has
    to be taken into account whether or not we actually believe
    there would be two full upfronts. That is analysis and
    assessments that will mature over time. Certainly we have to
    take that into account into the planning, as you have
    suggested.
        Senator Rounds. Thank you. Thank you, Mr. Chairman.
        Chairman Reed. Thank you, Senator Rounds.
        Senator King, please.
        Senator King. Thank you, Mr. Chair. First I want to thank
    you, Director Haines, for starting with an emphasis on cyber.
    The truth is we are in an invisible war on many fronts on cyber
    already, as you outlined anything from ransomware to attacks on
    SCADA (Supervisory Control and Data Acquisitions) systems to
    insertion of what I call sleeper cells in our critical
    infrastructure. You also emphasized, rightly, the fact that it
    has got to start at the desktop, and personal cyber hygiene is
    critically important.
        However, particularly on these state-sponsored potential
    attacks--well, I would say they have already occurred on our
    critical infrastructure--we are not going to be able to patch
    our way out of that, and you sort of slid by this in your
    opening comments. These State adversaries have to be deterred,
    do they not? They have got to understand that we hold their
    systems at risk, and that has got to be part of our strategy.
    It cannot just be patching and cyber hygiene. Do you agree?
        Director Haines. I do. I think that the deterrence does not
    necessarily have to be about holding their systems at risk from
    a cyber perspective alone. It is part of an integrated strategy
    that----
        Senator King. Right, but they have to feel that they have
    something at risk and that there will be costs imposed if they
    move in this direction. Otherwise, it is a low-cost kind of
    warfare, to which we are very vulnerable.
        Director Haines. Yes.
        Senator King. Do you see, and I think you also touched on
    this, do you see heightened Russian activity with regard to the
    upcoming elections?
        Director Haines. Yes. I mean, we are consistently, you
    know, obviously, the last several Intelligence Community
    assessments that we have done on election threats have
    identified Russia as really the major actor in this space, we
    continue to see them focused on this, and increasingly so.
        Senator King. Well, one of the things that worries me, in
    2016 and 2018 we saw them penetrating something like 40 states'
    electoral systems, in terms of data bases of voters and that
    kind of thing. They never did anything with it, but my
    contention was they were not doing that for fun. There is a
    great potential for disruption our election simply by erasing a
    voter data base in Miami or having the lights go out in
    Atlanta. Assess that risk, please.
        Director Haines. Yes. I mean, I think there is no question
    that they are increasing their capacity and that they are
    developing and using new technologies that are available to
    them to get better at doing what they have done before, and
    ultimately pursuing the potential for such altering.
        As you say, though, they have not done it, and what I would
    also say is that I agree--General Nakasone, before he left,
    indicated that he thought we were never better prepared to
    actually defend our election security infrastructure, and I
    think, honestly, the Intelligence Community, and in particular
    NSA and others, have really done tremendous work in this area,
    and CYBERCOM is consistently engaged in both defensive and
    offensive work in this area, to try to protect.
        Senator King. General Nakasone coined the term ``defend
    forward,'' which we all know what that meant.
        Director Haines. Yes.
        Senator King. CISA is also working with the states----
        Director Haines. Absolutely.
        Senator King.--and there has been a relationship of trust
    that I think is important.
        Director Haines. Yes.
        Senator King. One other area, and you have not touched on
    this, and that is part of my problem, I am afraid it all the
    pivot toward great power competition we are losing focus on
    terrorism. The terrorism threat has not gone away, and in terms
    of great power competition, deterrence is an important factor.
    When you are talking about terrorism, deterrence is not really
    a factor. They do not have a capital city that is at risk. They
    do not care about dying.
        So intelligence is our first line of defense. Reassure me
    that the Intelligence Community is not losing focus on
    terrorism because we are just three or four guys with malintent
    who can do an awful lot of damage in our country.
        Director Haines. Yes. I absolutely agree with you. This is
    a critical issue, it is a growing issue in many respects, and
    it is one that we are absolutely focused on, and we can talk
    further in obviously closed session about some of the things we
    are doing in that area.
        Senator King. Well, I just hope that we do not lose that
    focus, because again, we tend to shift. You know, we had 9/11
    and terrorism was everything for 15 or 20 years, and now it is
    all about China and Russia. I just do not want to lose that
    focus.
        Final question. I recently finished a book about the KGB
    [Komitet Gosudarstvennoy Bezopasnosti]. The KGB is essentially
    a paranoid organization. They believe that the West is out to
    get them. Putin came out of the KGB. How do we convince Putin
    that NATO is not an aggressive entity? We do not want to invade
    Russia. Nobody wants to invade Russia. We just want to protect
    the borders of Europe as they have existed since World War II.
    Do you agree with me that Putin really believe that NATO is
    winding up to somehow invade or otherwise violate the
    sovereignty of Russia?
        Director Haines. Yes. I do agree with you that there is a
    certain paranoia associated with this, and as I indicated in my
    opening remarks, Putin really does believe that the security of
    his country is at risk, on some level. It is, I think, a
    question actually I wish Director Burns were here for. How
    could you convince him psychologically that, in fact, NATO is
    not? In so many respects the actions that NATO has taken has
    actually been intended to reassure, and at the same time it has
    not landed.
        In many ways what Putin has done has precipitated so many
    events that he was seeking to avoid. I mean, he obviously did
    not want to see NATO enlarge, and yet his invasion of Ukraine
    precipitated Finland and Sweden joining, something that never
    would have happened, frankly, or we certainly would not have
    assessed that as being likely on the timeline that it occurred,
    before the invasion. He has actually made it much harder to
    convince him of that, because there were a number of efforts in
    NATO to actually talk to Russia----
        Senator King. He has provoked the very things he was
    worried about.
        Director Haines. Yes, exactly.
        Senator King. I am sorry. My time is up.
        Director Haines. Yes, please.
        Senator King. Thank you very much, Director. Thank you, Mr.
    Chairman.
        Chairman Reed. Thank you, Senator King.
        Senator Ernst, please.
        Senator Ernst. Yes. Thank you, Mr. Chair, and thank you
    both for testifying in front of us today.
        Director Haines, of course we are here to talk about global
    threats. We have heard about China, Russia, and so forth.
    Earlier this week the press reported an effort that would bring
    one of our global threats here to our homeland. A recent poll
    found that 71 percent of Gazans viewed Hamas' brutal attack on
    Israel, including the rape of innocent women, their murder of
    children, and their murder and capture of Americans as, quote,
    ``the correct decision.''
        Do you believe that welcoming a significant number of
    Gazans who likely are harboring these views into the United
    States, do you believe that would threaten the safety of
    Americans?
        Director Haines. I obviously think it is outrageous to
    think that Hamas' attack on Israel was anything other than a
    terrorist attack that was utterly brutal and depraved. I do not
    have enough information to understand, you know, when we
    analyze threats and where the threats come from and how they
    develop, that is something we do with great care and
    deliberation. If you pointed us to here are the individuals
    that we are concerned about then we would obviously do an
    assessment for you.
        Senator Ernst. So just broadly, though, 71 percent in this
    poll of those in Gaza support what Hamas did, and yet our
    President is considering an action to bring Gazan refugees to
    our homeland. So I know you have spent your career working in
    the intelligence field, but given this poll, which I would
    assume is factual, can you tell me for certain that this
    proposed action by the President of the United States will not
    put our citizens at risk here in the United States?
        Director Haines. I am unfamiliar with the poll, but I can
    tell you that the process for bringing individuals into the
    United States includes a very significant vetting process. That
    would be the kind of process I would expect would occur, and so
    therefore that would mitigate against any concern or risk that
    we would have.
        Senator Ernst. Okay. I know that we have tried to do
    vetting on Afghans and other refugees as they come in. Many
    times that has not been successful. I am adamantly opposed to
    what the President is attempting to do.
        So you are serving, by law, as the head of the Intelligence
    Community, and so you are saying basically, under oath, that
    you are really unaware of any risk that that might pose to our
    citizens?
        Director Haines. Sorry. What I am saying is that if there
    is a process for bringing people into the United States I am
    familiar with that process, and that process is intended to
    mitigate against any risk of security. That is something that I
    would feel confident about.
        Senator Ernst. Okay. Thank you. I would like to pivot now
    to Hamas' backers, the Iranian mullahs. Iran is currently
    enjoying a golden era of oil profits. We have seen over $80
    billion in oil revenues, enabling Iran to give pay raises and
    recruitment bonuses to its proxies, and you have discussed some
    of those proxies earlier. These revenues come from sanctioned
    transactions, but the enforcement of the sanctions remains non-
    existent.
        Do you agree, yes or no, that the decision not to enforce
    sanctions has directly led to the death of U.S. citizens?
        Director Haines. I could not make a sweeping statement like
    that, I am afraid. I think it is no question that Iran
    continues to benefit from oil sales and that they look for ways
    to get around sanctions, and that is something we have seen
    them engage in, and that they are also, as you say, funding and
    assisting various groups in the region. I think it is also the
    case that, frankly, the Iranian economy is in deep trouble
    right now and is actually suffering significantly. It has been
    one of the challenges that they are facing.
        Beyond that, unless I am faced with a particular scenario
    that we can assess for you then we would obviously do that.
        Senator Ernst. Well, what I would say is that they do back
    Hamas. We know that. They back Hamas, and I would not even say
    they are trying to get around sanctions, because we just do not
    enforce them. So there is open trade of Iranian oil. We, as the
    United States, have these sanctions; we do not enforce them. So
    a good deal of their profits, of course, will go to support
    these proxies. Hamas has killed Americans. They killed
    Americans on October 7th. They have held eight Americans. Three
    we know are confirmed dead. They are still holding five.
        So I would say that, just in my mind, my estimation, is
    that yes, they are using the profits to kill Americans. They
    have done it already. I would like to see additional
    enforcement of these sanctions. Not your area, but certainly it
    all ties together.
        So I look forward to visiting more about this, maybe in a
    closed session. We have got to do better, and I am just using
    this time to make a statement, too, that I disagree
    wholeheartedly with what the President is trying to do, by
    taking people out of Gaza and bringing them to the United
    States. I have seen failures in the vetting process before. I
    certainly do not want to see those failures repeated. So I
    appreciate your time today. Thank you.
        Chairman Reed. Thank you, Senator Ernst.
        Senator Hirono, please.
        Senator Hirono. Thank you, Mr. Chairman. Director Haines,
    you have acknowledged Russian interference with our upcoming
    elections. In another area, I am wondering whether the
    Intelligence Community was able to identify Russia's use of
    social media to put out messages that the Maui wildfire was
    caused by Government or that the Maui community should not
    trust FEMA [Federal Emergency Management Agency]. Was the intel
    community able to identify Russian use of social media in this
    regard?
        This is an important question because, of course, as we
    experience so many more of these kinds of massive climate
    disasters, or natural disasters, we can expect that Russia will
    use social media or some other ways to create instability and
    questions.
        Director Haines. Yes, thank you very much for the question,
    ma'am, and I do not remember. So we will get you an answer to
    that, yes.
        Senator Hirono. I know that, for example, Microsoft, for
    example, was able to discern that Russia was doing this with
    regard to the Maui wildfire, so I really would like you to
    address this for me.
        We know that there is a huge need for people to be able to
    work in the intel environment. So both of you, we know that
    there is a huge need for that. For General Kruse, the Pacific
    Intelligence and Innovative Initiative is working to create a
    local skilled workforce to meet DOD's demand for cyber and
    intel professionals in Hawaii. There is a huge need in Hawaii
    for people with this kind of background. How is this working,
    and are you also resorting to AI and other means of making your
    intel collection more efficient and effective, because there is
    a huge need for people with this kind of background, but we do
    not have those people yet. So can you respond to those two
    questions?
        General Kruse. Certainly. As mentioned, I have done several
    assignments to include 2016 to 2019 as the Director of
    Intelligence at USINDOPACOM and Camp Smith, and personally
    participated in several recruiting events with local
    universities and in partnership with the National Security
    Agency and DIA [Defense Intelligence Agency]. Lots of
    recruiting, even down into the high school level, to build some
    local recruiting and local workforce, and then in partnership
    with the Intelligence Community, working to develop centers of
    academic excellence in a recruiting pool, as well. So it is
    absolutely critical.
        I do not believe we will be able to fully man the
    intelligence requirements on island without doing local
    recruiting and being able to develop the workforce, and the
    local partners have just been absolutely tremendous. So to your
    answer there, it is critical to do. We are investing in
    additional STEM [Science, Technology, Engineering, Mathematics]
    and cyber pay, where those kinds of skill sets are required. To
    your point, we have skill sets that we need all across the
    board.
        On the artificial intelligence question about how do we
    become more efficient, I think what you will find across the
    Intelligence Community is that we are applying AI, and in
    closed session we can also talk about counter-AI. How can we be
    the most effective and the most efficient? I would be happy to
    walk you through a couple of very specific examples that the
    Defense Intelligence Agency is currently doing. Then right now
    we are looking at how do we partner with NGA [National
    Geospatial-Intelligence Agency], NRO [National Reconnaissance
    Office], and NSA [National Security Agency], and DIA to bring
    almost a system of systems to be able to queue and be much more
    effective and much more efficient in how do we collect and how
    do we assess what we are collecting.
        Senator Hirono. Thank you. Director Haines, you
    acknowledged that we have critical infrastructure in the
    private sector, i.e., our electrical grids, that are subject to
    cyberattacks, and you noted that you spent quite a lot of time
    in this area, talking, I suppose, with the State people and the
    private sector who provide these kinds of grids. You noted that
    good cybersecurity practices, such as something as relatively
    simple as updating passwords, would be very helpful. Do you
    know if this is happening, and do you partner with, for
    example, the Public Utilities Commission in the State of
    Hawaii, and other agencies that actually regulate what these
    entities do, our electrical and other power entities?
        But I just want to know. Something as simple as updating
    passwords, do you know if this is happening?
        Director Haines. Yes, so we are not working directly with
    sort of the utility companies across the United States. It is
    really DHS [Department of Homeland Security] in the form of
    CISA and the Department of Energy and others that are doing
    that, and we support their work by trying to make sure that
    they have the intelligence they need to provide warning, but
    also then to better understand what the questions are that are
    coming from utilities in this space.
        My understanding is that they are working very hard with
    them to improve their cybersecurity practices, patch
    vulnerabilities, deal with these issues. But it is just more of
    an observation from our perspective that as we are looking at
    the attacks that are occurring, particularly against industrial
    control systems in the country, that the vast majority of them
    would have been actually prevented if it were not for those
    kinds of cybersecurity practices not being what they need to
    be, and instead using default passwords, weak passwords, not
    patching vulnerabilities that are publicly available, and so
    on.
        Senator Hirono. So it is the Department of Homeland
    Security and basically the Energy Department who would be the
    people that I should ask?
        Director Haines. Yes, CISA within the Department of
    Homeland Security, and we can work with your staff to make sure
    that you have exactly who is talking to who, and that sort of
    thing, and if that is helpful for Hawaii.
        Senator Hirono. Thank you. Thank you, Mr. Chairman.
        Chairman Reed. Thank you, Senator Hirono.
        I will recognize Senator Scott, but I will depart shortly
    for the Appropriations Committee, and Senator Kaine has agreed
    to chair the proceeding in my absence. I shall return. Someone
    once said that. So Senator Scott?
        Senator Scott. Thank you, Chair. Director Haines and
    General Kruse, thanks for being here.
        We have discovered that the DOD purchases equipment from
    Communist China like printers, computers, TV cameras. Also,
    they purchase drugs made in Communist China, which shocks me. I
    do not think it is a secret that Communist China wants to
    destroy our way of life. I think we ought to stop everything--
    we should never buy anything. None of us should ever buy
    anything from Communist China. I do not think they should get a
    penny of our money, because all they do is buildup their
    military to eventually try to defeat us.
        A couple of weeks ago, the Secretary of Defense testified
    that he does not think we should purchase anything from China.
    Do you each agree with the Secretary?
        General Kruse. I would echo the Secretary's comment.
        Director Haines. Certainly I make it a practice to agree
    with the Secretary of Defense.
        Senator Scott. So Israel was attacked on October 7th. I
    went back over to visit a kibbutz I was at and I saw the
    devastation. The Secretary of Defense also testified that there
    was no evidence that Israel was committing genocide in Gaza or
    committing war crimes in Gaza. Do each of you agree with that?
        Director Haines. I certainly have no evidence that that is
    the case, but the fact is in the Intelligence Community we do
    not make that kind of determination. That is a legal
    determination made by others in the U.S. Government.
        General Kruse. I would echo that answer.
        Senator Scott. So you have no intelligence that Israel is
    committing genocide or war crimes. So you do not have any
    evidence that they are.
        Director Haines. As I said, sir, we just do not make that
    determination. What we do is we identify the intelligence as we
    see it, and we give it to others who would make that kind of
    determination.
        Senator Scott. Okay. So we have watched what is happening
    on a lot of our college campuses, like Columbia, UCLA, even
    here in D.C. at George Washington University. Do you have any
    intel of outside countries or groups funding some of these
    violent protests that are going on around the country?
        Director Haines. We have yet to see intelligence that
    Hamas, which is generally how the question is framed to us, is
    actually influencing the Gaza-related protests occurring the
    United States or directing it in any way. That does not mean
    that, over time, we will not gather intelligence that indicates
    that certainly, for example, I would expect other countries to
    take advantage of the opportunity and use it as part of
    influence operations. But we will continue to monitor that.
        Senator Scott. General Kruse?
        General Kruse. The same thing. I do not believe we have
    seen exactly what you are asking, but I would anticipate the
    environment would be an opportunity that others would take
    advantage of.
        Senator Scott. Okay. How about Qatar? Have you seen any
    evidence that they are supporting these protests?
        Director Haines. No, sir.
        Senator Scott. A couple of weeks ago, the head of Space
    Command, I asked him a question. If 12 of our satellites were
    destroyed and all the debris was up there, how much of an
    impact would it have on the rest of our satellites that we
    depend on? How would it impact our ability to defend ourselves?
    Have you done any intelligence briefings that you believe this
    is a risk, not a risk?
        Director Haines. This is one of these things where it is so
    case dependent. In other words, just having debris in space is
    always a problem, and one that obviously ultimately allows for
    the potential damage of not just national security interests
    but also commercial and other interests that are effectively
    facilitated by space. Where the debris occurs makes a
    difference, and so how much of an impact it would have would
    matter upon where it is? What other satellites are in the
    region, what satellites have been destroyed, for example? All
    of those things are important. We can talk further in closed
    session, I think, about some of the modeling that we have done
    that might be helpful to you.
        Senator Scott. General Kruse?
        General Kruse. I would just add the other part of the
    calculus there is which 12 satellites in this scenario would be
    taken out. There is a capability reduction that is also a
    decrement that we would be very much concerned about. Purely to
    the debris question, I agree, there has been some modeling done
    that we could discuss.
        Senator Scott. How big a risk do you think it is on
    ingredients in our drugs from China, for our military? Either
    of you?
        General Kruse. I do not know that I know enough about that
    topic to be able to speak on that, and I would be more than
    happy to work with our analysts to see if we an answer for you
    that would be useful for you.
        Senator Scott. Does it surprise you guys that so many of
    the ingredients in our drugs are coming from China? When they
    are, at the same time, trying to kill Americans through
    fentanyl and everything else, and that our military is still
    relying on I think it is the majority of our drugs' ingredients
    are coming from China.
        General Kruse. I do not believe that I am surprised by how
    the market has developed over years and decades, and then where
    we find ourselves today. As the environment want us to withdraw
    there is a supply chain that we will have to modify to
    implement the policies you are talking about. Certainly you
    have accurately described how the market has developed and how
    our supply chains currently work.
        Senator Scott. Thank you.
        Senator Kaine. [Presiding.] Thank you, Senator Scott. Good
    to see you both. I want to just acknowledge some amazing work
    that the U.S. military has done in two very challenging
    contexts recently. The United States effort to support Israel,
    together with other nations, during the attack from Iran was
    truly a superb operation. I do not think that kind of thing
    happens by accident or by chance. It demonstrates an awful lot
    of training, an awful lot of capacity, and an awful lot of
    cooperation. Had we not been successful in that, the level of
    escalation that we might have seen in the region, the damage to
    Israeli cities, communities, people, the likely escalation
    thereafter could really have been devastating, at a very
    critical time where the last thing we need is escalation in the
    Middle East.
        So at a hearing like this I want to acknowledge the great
    service of U.S. military in forming together with Israel and
    other nations a defense against the Iranian attack.
        Second, the work that the United States, primarily the Navy
    but not solely the Navy, has done in the Red Sea to repel
    attacks by Houthis against commercial ships, military ships,
    again in tandem with allies, but most of the work, the hard
    work, the kinetic, hostile fires being taken by U.S. military
    has been truly remarkable. The remarkable thing--and I know
    this has got to keep you guys up every night--is when we are
    sitting there in the Red Sea and absorbing incoming over and
    over and over again, we have to have 100 percent success rate.
    It cannot be 98, it cannot be 99 percent. My understanding is
    it has been 100 percent up to now. I do not want to jinx it. We
    have been as close as 3,000 yards from striking a U.S. ship
    that we were able to take down with the Gatling gun. Some use
    of missiles has enabled us to take down incoming missiles or
    drones at further distance. But 3,000 yards is pretty close. We
    have got a lot of Virginians on those ships in the Red Sea, and
    I know other members here have sailors from their states there
    too.
        So I want to start with that, and it takes a lot of work to
    get to that. I mean, the development of the Aegis system goes
    back decades, and good intel, and using the intel well, both to
    defend but also to strike positions in Yemen that could do
    damage. I mean, I just want to express appreciation.
        I do want to focus on the Red Sea, so let me begin with
    Director Haines. What does the IC assess about the Houthis'
    continuing threat on commercial shipping and how long is that
    threat likely to remain active?
        Director Haines. Yes, so our assessment is essentially that
    it is going to remain active for some time. It is, in part,
    because Abdul-Malik, the leader of the Houthis, continues, we
    think, to see domestic political advantage for some of the
    actions that he is taking, that he is interested in kind of
    burnishing his regional reputation, and he has seen this to be
    adding to that in many respects, and that they continue to
    indigenously produce a fair amount of UAVs, other weapons
    systems, and so on, and of course they are also getting
    assistance from the Iranians in this respect, and that neither
    of those things are likely to change in the near future.
        Now, that does not mean that the strikes that the
    Department of Defense and the coalition with our allies have
    taken have not had impact. They have. But it has been
    insufficient to really stop the Houthis from going down this
    road, and so that is sort of our----
        Senator Kaine. What is your assessment about if there were
    to be a cease-fire in Gaza? What is the likelihood that the
    pace of attacks would significantly reduce?
        Director Haines. Yes, it is honestly unknown at this stage.
    They have indicated, at different times, that they would comply
    with a cease-fire, so I think there is a fair possibility that
    that is what----
        Senator Kaine. Wasn't there some abatement of the pace of
    attacks into the Red Sea during the first----
        Director Haines. The prior.
        Senator Kaine.--the cease-fire.
        Director Haines. That is exactly right. They did in the
    prior one. But one of the things that has been challenging is
    that their rationale for their attacks has shifted over time a
    bit, and it has gotten more complicated at times, even
    indicated that they would not stop until humanitarian
    assistance had been delivered to a certain degree, things like
    that. So it seems like there are additional requirements that
    he has added, but it does not mean that he would not pause
    during a cease-fire.
        Senator Kaine. Even if the cease-fire might, under past
    rationale, lead them to stop to the extent that they feel like
    this is burnishing their reputation for being kind of a bad
    actor, they might continue even in a cease-fire condition.
        Director Haines. Yes, it is possible.
        Senator Kaine. Last question. Why aren't more allies and
    members of the coalition helping the United States and actually
    taking military action against Houthis who are targeting their
    ships? I mean, we are protecting commercial ships of other
    nations. The number of nations that are participating in the
    military activities seems small to me. How should I understand
    that?
        Director Haines. Yes. I mean, I will start, and General
    Kruse may have more to add here. I think a number of them
    really are trying to help in any way that they can, and we have
    seen it come in different forms, you know, and I would really
    defer to the Department of Defense in terms of the degree. But
    let me----
        Senator Kaine. Provide a quick answer since I am over my
    time, General Kruse.
        General Kruse. Sir, I think I would just add that, to the
    DNI's point, many of them are contributing in other ways, and
    they are important ways. While there are few that might be
    doing defense in the Red Sea specifically, they are doing
    things that we actually count on. We appreciate the
    partnership, but would welcome anyone else who would want to
    participate.
        Senator Kaine. Senator Cotton.
        Senator Cotton. Senator Ernst raised the media reports that
    suggest President Biden may admit Gazans to this country as
    refugees. I agree with her. I think that would be insane. There
    is a reason why Egypt will not let them in, and Egypt is right
    on their border and speaks their language and has a vested
    interest in protecting itself from threats from Gaza. If they
    will not let them in, I do not think the United States should
    let them in either.
        But I want to focus now on the actual threats from the
    crisis at our southern border of actual migrants who have
    crossed into this country already. Director Haines, the FBI
    director recently said, the terrorist threat level that we are
    contending with right now is at a whole other level. Do you
    agree with Director Wray's assessment?
        Director Haines. Yes, absolutely the terrorist threat level
    is of great concern, and we can obviously have discussions in
    closed session about what that means. So I would agree with
    that.
        Senator Cotton. How many illegal immigrants on the terror
    watch list have been caught at the southern border this year?
        Director Haines. I do not remember the number exactly, and
    we can get you that. Many of them, as I recall, are ones that
    came out of Colombia. We should give you----
        Senator Cotton. The answer is 75. Do you think we pitched a
    perfect game at the border and caught every single migrant on
    the terror watch list trying to cross into our country?
        Director Haines. No, but being on the terrorist watch list,
    meaning that if there is known or suspected terrorists or there
    is information that they may have had contact with does not
    actually mean that they are all----
        Senator Cotton. Okay. How many terrorists have tried to
    cross the southern border during the Biden administration's
    tenure?
        Director Haines. Sir, I do not know that I can give you a
    percentage on that.
        Senator Cotton. I think the answer is 357. Again, do you
    think we pitched a perfect game for the last 3 1/2 years and
    got 357 out of 357? No, I do not think so.
        How many terrorists tried to cross the southern border
    during the 4 years of the Trump administration?
        Director Haines. I don't know, sir.
        Senator Cotton. I think the answer is 11. The Biden
    administration has also granted entry to more than 7,300
    illegal aliens who are known as special interest aliens, which
    means they come from notorious terrorist breeding grounds like
    Uzbekistan, Syria, Iran, and impose a potential national
    security risk. That number was based on data collected before
    Hamas' October 7th atrocity against Israel.
        Since then, do you think that there may be an even greater
    surge if Islamic extremists trying to cross our open southern
    border?
        Director Haines. Can you repeat the question, sir?
        Senator Cotton. The Biden administration had granted entry
    to more than 7,300 illegal aliens in the special interest alien
    category from places like Uzbekistan, Syria, and Iran, and that
    number came before the October 7th atrocity in Israel. Since
    then, do you think there might have been an even greater surge
    in Islamic extremists trying to cross our open southern border?
        Director Haines. We have not seen Hamas directly
    essentially folks or others in the region to come into the
    United States to engage in attacks from the Gaza conflict. That
    does not mean that obviously this is not something that could
    develop over time, but we are not seeing that related to the
    Gaza conflict, if that is what----
        Senator Cotton. Last year, Customs and Border Patrol
    officials in San Diego issued an internal intelligence notice
    titled ``Foreign Fighters of the Israel-Hamas Conflict May
    Potentially be Encountered at the Southwest Border.'' So CBP
    certainly expect Islamic radicals will try to exploit the
    border.
        Director Haines. We are trying to----
        Senator Cotton. Do you think that report is excitable and
    exaggerated?
        Director Haines. No. I think it is absolutely, you know, it
    is appropriate to be vigilant on these issues, and as we have
    talked about in the context of the Gaza conflict we have seen
    that galvanize, in a sense, different terrorists around the
    world in different ways. I think we are just trying to be as
    careful as we can. We just have not seen----
        Senator Cotton. Okay. I want to turn to China briefly here.
    Last week, Secretary Blinken, on his ballyhooed trip to China,
    said that China is, quote, ``overwhelmingly the number one
    supplier for Russia's war against Ukraine.'' Do you agree with
    Secretary Blinken's assessment?
        Director Haines. There is no question that the dual-use
    material that is coming through China is having an enormous
    impact----
        Senator Cotton. Is China overwhelmingly the number one
    supplier?
        Director Haines. I mean, they are overwhelmingly the number
    one supplier to the defense industry in Russia right now.
        Senator Cotton. Okay. He also said that those supplies are
    having, quote, ``a material effect,'' end quote, on the war in
    Ukraine. Do you agree with Secretary Blinken's assessment
    there?
        Director Haines. I do. I indicated in my opening remarks
    that we see their supplies actually one of the key factors that
    essentially adjusted the momentum on the battlefield in
    Ukraine.
        Senator Cotton. Okay. On March 18, 2022, 3 weeks after the
    war started, President Biden had a call with Xi Jinping where
    he said do not provide, quote, ``material support,'' end quote,
    to Russia. Otherwise you and China could find yourself in,
    quote, ``significant jeopardy,'' end quote. That appeared to
    have gotten Xi Jinping's attention in 2022, if you look at
    trade data, but over the last year China has now become what
    you and Secretary Blinken call Russia's overwhelmingly number
    one supplier.
        One of your predecessors as Deputy National Security
    Advisor says that Joe Biden is now not enforcing the red line
    he drew on March 18. Do you agree that President Biden is now
    refusing to enforce that red line he drew with Xi Jinping in
    March 2022, about providing material support to China?
        Director Haines. I do not. Here is the challenge that I
    think we have encountered, which is basically there was a lot
    of focus on China not providing lethal support, and what they
    have done is try to avoid what is characterized as lethal
    support, in other words, a fully constructed gun or weapon
    system, et cetera, to Ukraine, and that has been something that
    they have maintained. What has happened, in the meantime, is
    they provided effectively dual-use materials such as
    nitrocellulose, a whole series of other things that are
    critically important sort of folds in the tent for the Russia
    reconstitution of their defense industry. That has been the
    space that policymakers, I know, have been working, including
    with Congress, to try to prevent from going to Russia, and
    there has been mixed success in pushing back against that.
        Senator Cotton. Well, my time is up. I would dispute the
    characterization that China is only providing dual-use
    material, but I do not think there is any question that
    President Biden drew a red line in March 2022, and he has not
    been enforcing it against China since.
        Chairman Reed.
        [Presiding.] Thank you, Senator Cotton. Senator Gillibrand,
    please.
        Senator Gillibrand. Director Haines, earlier this week the
    Administration published an updated national security
    memorandum on critical infrastructure security and resilience.
    How is the IC ensuring effective intelligence sharing and
    information exchange regarding threats to critical
    infrastructure, including threats to food and agriculture
    sector?
        Director Haines. Thank you, Senator. I know this has been
    an area that you have focused on for quite some time, and we
    are basically, through our Cybersecurity Threat Integration
    Intelligence Center we have been expanding our support, in
    effect, anticipating the NSM but also more generally for
    critical infrastructure working with CISA, working with the
    cyber director, obviously, out of the executive branch, and
    across the interagency. I think it continues to be an effort in
    moving across different sectors that are at risk in this area.
        Senator Gillibrand. Given the recent news about avian bird
    flu has leapt to other animals, can you talk a little bit about
    since COVID-19, I have been advocating for a one-health
    approach to biosecurity that incorporates animal, plant, and
    environmental health in addition to human health, to detect and
    prevent the next pandemic. Do you believe that the IC is
    sufficiently equipped to detect and assess the full range of
    biological threats that can appear in humans, animals, and
    plants, and how is the National Counterproliferation and
    Biosecurity Center at ODNI supporting this effort?
        Director Haines. Yes, I think it would be always an
    overstatement to say that we can detect everything that would
    be ultimately a potential vector for both human and animal
    concerns.
        But the fact is we have really expanded and invested a
    tremendous amount in improving our biosecurity practices, not
    just in terms of what the National Counterproliferation and
    Biosecurity Center does in the context of allocating resources
    for collection, to ensure that we actually have what we need in
    order to be able to identify vectors but also in doing some
    really extraordinary modeling for how it is that we can detect
    when there are outbreaks what is happening and how we can
    manage it, thinking through the analytic structure that we need
    to build it into a variety of different functional and regional
    areas that we are managing in these spaces, and supporting,
    which has been obviously a main effort by the policy community,
    a broader, all-of-government kind of biosecurity effort in
    these areas. So I do think we have improved, but I think there
    is still room to grow.
        Senator Gillibrand. Because what the legislation would do,
    it would co-locate not only the IC community but with the
    agriculture and scientific communities, so that you are in
    constant communication, on a regular basis. In the same way we
    do fusion centers for antiterrorism, fusion centers for
    cybersecurity, it would be a one-health fusion approach. I know
    that is not the exact organization today, but today are you at
    least having communications with those sectors to be informed
    and to get the most up-to-date information possible?
        Director Haines. Yes. Our director has actually invested
    quite a lot in improving our communication with non-title 50
    agencies, which is how we think about it, including the
    Department of Agriculture and others, so that we can actually
    have those sorts of conversations. It has also been supported
    by the work that our Cybersecurity Threat and Integration
    Center has done, which has also been improving our
    communication with various non-Title 50 agencies and
    departments, including again the Department of Agriculture,
    because we see them as one of the major sorts of threat
    potential vectors.
        Senator Gillibrand. Thank you. I think as you know, the
    National Defense Authorization Act from 2024 expanded the Cyber
    Service Academy to allow up to 10 percent of graduates to serve
    in the non-DOD Intelligence Community if that component enters
    into an agreement with the Department of Defense. Has ODNI
    entered into discussions with the DOD yet to take advantage of
    this source of cyber professionals, and have you encouraged
    non-DOD components of the IC to pursue this talent pool?
        Director Haines. Yes, absolutely, and I believe we are in
    discussions but we have not yet concluded an agreement.
        Senator Gillibrand. Thank you. Thank you, Mr. Chairman.
        Chairman Reed. Thank you very much, Senator Gillibrand.
    Senator Mullin, please.
        Senator Mullin. Thank you, Mr. Chairman. Director Haines,
    you had mentioned briefly a little bit about Iran's economy. Do
    you want to broaden a little bit more on that?
        Director Haines. I should get you the fact and figures. I
    do not have them in front of me.
        Senator Mullin. But you said it was in bad shape, right?
        Director Haines. Yes.
        Senator Mullin. I do not disagree that it is probably not
    in great shape, but would you agree it is in better shape than
    it was 3 years ago?
        Director Haines. No. We just recently did a piece that
    really looked at some of the challenges.
        Senator Mullin. Ma'am, according to the statistics that
    study that, actually the GDP for Iran is projected to have a
    ninth consecutive year by 2029, and in the last 4 years since
    Biden released the sanctions they have actually doubled their
    GDP. In 2019, they were just about $250 billion GDP, and in
    2020, they had dropped to below 200, and today they are over
    500, and projected to continue to grow until 2029, underneath
    the current statistics.
        Now this stuff is open source that you can get, and I
    actually read it to you. The gross domestic product for GDP as
    currently priced in Iran was forecasted to continue to increase
    between 2024 and 2029, which has already had 4 consecutive
    years of increase, over $101 billion, U.S. dollars, at a 24.15
    percent increase over the next 4 years. Since 2025 to 2022, the
    gross domestic output is $576.24 billion.
        So have the sanctions that were lifted been a good thing or
    a bad thing for Iran and the war on terror?
        Director Haines. I will get you the figures that we have on
    this issue and see if that----
        Senator Mullin. I mean, these figures are government
    figures. I literally pulled them up since we were sitting here,
    since you said that, and so I think, I mean, you are the
    Director of Intelligence. These are something that you really
    should know, because the more money they have is not good for
    the U.S. Would you agree with that?
        Director Haines. I certainly think that the more money that
    they spend on destabilizing activities, on funding various
    groups----
        Senator Mullin. Is there any----
        Director Haines.--what we see as destabilizing, all of
    those things are not----
        Senator Mullin. Is there really any debate that Iran is the
    number one sponsor of war on terror at this point?
        Director Haines. They are absolutely a sponsor.
        Senator Mullin. So we can both agree that the more money
    they have is bad.
        Director Haines. For that, absolutely.
        Senator Mullin. Okay.
        Director Haines. But what I would say is----
        Senator Mullin. So is this----
        Director Haines.--for example, if you look at----
        Senator Mullin.--is this a good thing----
        Director Haines.--at the value of----
        Senator Mullin. Ma'am, what I am trying to get to is we saw
    a decrease in their GDP when Trump put in strong sanctions and
    worked with Congress. Those were lifted underneath the Biden
    administration. Do you agree with those actions?
        Director Haines. I do not take policy positions from the
    Intelligence Community.
        Senator Mullin. Well, the intelligence is following the
    money.
        Director Haines. I understand, and if you want----
        Senator Mullin. So from the intelligence perspective, not a
    policy, then, from an intelligence perspective, Director
    Haines, was that a good thing?
        Director Haines. It is neither a good thing nor a bad
    thing. If you want an assessment on whether or not----
        Senator Mullin. How can you say it is neither a good thing
    nor a bad thing, ma'am, when you just said they are the number
    one sponsor of war on terror? That is not debatable. We know
    that. A while ago you said that their economy was faltering,
    but yet we have seen that it has actually doubled underneath
    the Biden administration since they lifted the sanctions that
    Congress and the Trump administration put in place. That means
    they have more money to spend on this. That is not really a
    policy question. That is from an intelligence perspective. That
    has got to cause problems.
        Director Haines. Senator, so on the economy, why don't we
    get you our assessment of how they are doing. Even if I am
    right that they are having challenges economically, I do not
    think that necessarily is a line that you can draw directly
    between sanctions and how their economy is doing. There are a
    number of factors that obviously you have to look at in order
    to determine that. I am more than happy to do an assessment for
    you that helps to identify what the impact of different
    sanctions, less sanctions, more sanctions, all of those things
    on the economy, and then how that relates to spending, for
    example, on national security issues that are of importance to
    us, which we do produce an annual report for you on.
        Senator Mullin. Well, I would appreciate that, and I do not
    think that we would say that their economy is in great shape.
    But we can say that throughout all of the Middle East, the
    middle of the Middle East, we can say that there is a problem
    there with their economy.
        But what I am getting to is that the current position that
    the Administration, this current Administration, has taken
    underneath Biden has not been helpful for our security posture.
    We have seen that their economy has greatly increased and is
    going to continue to increase if we stay underneath the
    continued projection of the way we are treating Iran currently.
        I think that our posture should, and you can agree,
    disagree, or not--in fact, you do not even have to answer it
    because I am not going to put you in that position again--that
    we have to relook at our posture we have with them, because
    their GDP has increased. That means their spending on the war
    on terror, against us and against our allies, has also
    increased.
        With that I will yield back.
        Chairman Reed. Thank you, Senator Mullin.
        Senator Warren, please.
        Senator Warren. Thank you, Mr. Chairman. So Director
    Haines, when you testified before the Committee last year we
    talked about how crypto is being used to help finance major
    threats against national security, like North Korea's nuclear
    weapons program, Iran's ability to evade sanctions, and
    ransomware attacks on American hospitals. It seems the problem
    is getting worse.
        According to the Wall Street Journal last month, crypto has
    become, quote, ``indispensable to Vladimir Putin's war machine,
    allowing Russia to get around sanctions and to throw billions
    of dollars into its war against Ukraine.'' According to the
    Treasury Department, Hamas' terrorist attacks against Israel in
    October were financed, in part, with crypto, and their current
    financing depends on crypto. According to the blockchain
    analytics firm, Elliptic, Iran is deep into crypto.
        So let's focus for just a minute on how Iran is using
    crypto. Director Haines, reports from our Intelligence and
    National Security Agency say that Iran uses crypto to evade
    United States sanctions. For example, in 4 years, Binance, just
    one of many crypto exchanges, processed $8 billion in
    transactions for Iran. Can you explain what threat that poses
    for our national security?
        Director Haines. Yes. There is no question that
    cryptocurrency is a significant issue for our national
    security, and as you say, we talked about DPRK last time, and
    today we continue to produce statistics that indicate that I
    think it is now over 50 percent of their foreign currency
    revenues are coming through crypto, that there is really just
    significant exploitation of this as a way to get around
    sanctions to ultimately engage in illegal transactions, to
    support a system, and certainly the ransomware attacks and
    other things like that demonstrate it.
        With respect to Iran, we see this. So there is no question
    that Iran permits the use of cryptocurrencies and smart
    contracts to pay for imported goods because it lacks access to
    the U.S. dollar, and that is a consequence of the sanctions
    regimes that are in place. What is also true, though, and I
    think just to frame it, does not mean that this is not a
    problem, but its use is relatively limited as compared to other
    transaction pieces.
        So it has not been as much of a major factor, in our
    judgment, as it might otherwise seem. So in other words, we
    have got, in early August 2022, the country made it first
    official cryptocurrency payment for imports, which were $10
    million, out of a total of $102 billion for imports. It is sort
    of a similar challenge in the context of Russia, as well, where
    we see them using cryptocurrency, and I think it is almost
    certainly going to expand in different ways.
        But there are some kinds of structural limitations on their
    capacity to use that.
        Senator Warren. So let's look into that. Let's look at the
    structural limitations here, because I think what you are
    telling me is Iran is definitely using crypto to move money
    around.
        Director Haines. Yes.
        Senator Warren. To do that to evade sanctions and to fund
    Hamas, and your assessment is consistent with the assessment of
    the Treasury Department on this.
        But that is not all that Iran is doing with crypto. Iran is
    also making money by processing crypto transactions for other
    people. As you know, crypto relies on middlemen--in the crypto
    world they are called miners or validators--and they process or
    verify transactions. The Iranian Government officially entered
    the crypto industry in 2019, because it could make money doing
    it.
        So if I sent $1,000 in Bitcoin over to you, Lieutenant
    General Kruse, and you and I might be sitting here in
    Washington when we engage in this transaction, but Iran may be
    the one that is processing the transaction for us and pocketing
    the transaction fee that I pay. Neither one of us would ever
    even know that we were enriching Iran through this transaction.
    According to one estimate, in 2021, Iran processed as much as 7
    percent of the world's Bitcoin transactions, enough to earn
    them about $1 billion.
        So Lieutenant General Kruse, the bigger the crypto market
    gets, the more opportunities Iran has to profit by processing
    other people's crypto transactions. Let me ask you, how
    important is it that we cutoff this revenue source for Iran?
        General Kruse. Well, if I could, what I would say is this
    is not dissimilar to the previous conversation about the source
    of revenue, whatever Iran's source of revenue, crypto or other
    transactions, oil sales, and then how Iran uses it. So it does
    come to more finances they have available to them, this or
    other sources, certainly allows Iran to make decisions on how
    it is going to----
        Senator Warren. Look, we have the tools to cutoff countries
    like Iran from the banking transactions, but those tools were
    not designed for cryptocurrencies, so crypto money keeps
    flowing here. That is why I am concerned about any effort to
    regularize stablecoins without giving regulators the full set
    of tools they need to crack down on terrorist financing.
    Anything Congress does to legitimize and grow the crypto market
    must have strong protections so we do not increase moneymaking
    opportunities for Iran and other adversaries.
        Thank you, Mr. Chairman.
        Chairman Reed. Thank you, Senator Warren.
        Senator Rosen, you are recognized.
        Senator Rosen. Thank you, Mr. Chairman, and I would like to
    thank Director Haines and General Kruse for testifying today
    and for your service.
        So I guess the theme this morning is Iran, and of course I
    am going to expand a little bit about Iran and the Russia
    defense cooperation because Iran has used the war in Ukraine to
    bolster its own military partnership with Russia by providing
    Putin's regime hundreds of drones that have killed Ukrainian
    civilians. In return, Russia is providing Iran with missiles,
    cyber tools, air defense systems, and Iran is also seeking to
    acquire modern Russian fighter jets, helicopters, and radars.
        So General Kruse, how does Iran's capacity to produce and
    export long-range attack drones, evident in both the Middle
    East and against Ukraine, potentially accelerate the spread of
    such capabilities globally, particularly with Iran supplying
    these systems to Russia for its use in war? I will just add, if
    you want to talk about both of these, how does this acquisition
    also enable Iran to take an even more aggressive posture right
    now in the Middle East?
        General Kruse. I think Iran has spent considerable time and
    effort to be able to produce the kinds of UAVs and other
    equipment that others would find of value, and they continue to
    improve the capabilities of what they have been selling over
    time. You mentioned several hundred. I would say it is probably
    even 1,000 or more of UAVs that Iran has provided directly to
    the Russians, that they are using on the battle space, and also
    providing designs so Russia can do their own manufacturing of
    that.
        This has been a somewhat new business line. It is just a
    continuation of Iran's previous business line. But it does
    provide two things. One is a revenue source to Iran. It
    provides also some capabilities to the proxy organizations and
    other adversaries and increases their capability and their
    capacities over time.
        Senator Rosen. Thank you. I want to move on a little bit
    into what powers a lot of these systems, particularly as we
    think about Bitcoin, cyber, all these threats--artificial
    intelligence. So we have a little bit to worry about in
    artificial intelligence competition. So Director Haines, as we
    continue to explore really the potential of artificial
    intelligence, we have to really discuss these ethical
    boundaries, right, because there are growing concerns that our
    strategic competitors like China, Russia, and others may not
    adhere to the same ethical standards, especially regarding the
    weaponization of technology, potentially leading to abuse which
    can threaten our global security, our national security.
        So could you discuss the implications of this difference in
    ethical standards for AI development and deployment,
    particularly in terms of threats to our security, and how do we
    work with our allies to put in these ethical standards, because
    we know artificial intelligence, it is garbage in, garbage out.
    Whatever you put in is what comes out, and that is why this is
    particularly important.
        Director Haines. Yes, absolutely. I mean, I agree with how
    you have characterized the challenge, and I think it is one of
    the--there is sort of the first-order issue, which is an
    ethical issue but may be even a step beyond what you are
    describing, which is to say that----
        Senator Rosen. It is an educational issue, because
    computers learn.
        Director Haines. Exactly, yes, and so one is it clearly, in
    many respects, generative AI in particular but AI generally can
    exacerbate existing threat streams, as we have seen them make
    our adversaries far more effective and also sort of lower the
    cost of entry into these kinds of threat streams. So in other
    words, for information operations, for cybersecurity, for
    biosecurity, other issues like that, obviously these are
    technologies that allow you to be more effective and to do so
    more cheaply, in many respects, in a number of scenarios. So
    there is that piece of it.
        A second piece of it I would say is that there are, as you
    say, different standards that we apply. So for example, our
    commercial companies will only train their models on what is
    appropriate from an intellectual property perspective, whereas
    you may see other countries not paying attention to those kinds
    of standards and getting into other material, and that can
    create a different series of challenges in these spaces and how
    you sort of develop against that. You obviously need to ensure
    that you are paying attention, if that regulatory through
    standards or other things that can be useful to try to achieve
    that.
        In addition, to your point, we obviously care very much
    about the governance of AI, how we are applying sort of privacy
    and civil liberty issues to the work that we are doing. I think
    on the one hand that may mean that we move sometimes just
    slightly more slowly or we are thinking through how it is that
    we are ensuring that what we are producing is consistent with
    our values and our ethics in these spaces.
        But at the same time I actually think that can increase the
    efficacy, in many respects, of the work that we are doing,
    because ultimately what you really want to do is train AI on
    the best possible data, quality data, things that do not have
    inherent biases in them, things along those lines that will
    actually get you the answers that are more effective in
    answering the questions that you are ultimately trying to do.
        So we are spending quite a bit of time, both on thinking
    about how we use it in a positive way and for our mission but
    also how to counter what it is what we are seeing obviously
    from allies in these spaces. Maybe I will leave it at that.
        Senator Rosen. Thank you. I have some questions on
    antisemitism. I will submit them for the record. Thank you, Mr.
    Chairman.
        Chairman Reed. Thank you very much, Senator Rosen.
        Senator Schmitt, please.
        Senator Schmitt. Thank you, Mr. Chairman. Director Haines,
    I have a couple of questions. Recently you stood up the Foreign
    Malign Influence Center, and you were quoted as stating that it
    would allow the FMIC to track disinformation campaigns from a
    foreign country but also, quote, ``the public opinion within
    the United States.'' What does that mean?
        Director Haines. I do not know. That----
        Senator Schmitt. Oh, actually, okay. Well, are you tracking
    the public opinion of the United States?
        Director Haines. No.
        Senator Schmitt. Okay. How is FMIC different than CISA? I
    thought CISA was created to do this?
        Director Haines. Okay. So FMIC is actually, we established
    it pursuant to a statute----
        Senator Schmitt. Right.
        Director Haines.--that asked us to establish it. What we do
    within the Foreign Malign Influence Center, which encompasses
    our election threat work effectively across the community, is
    allocate resources in relation to collection. We work through
    analytic work that is supportive of what CISA does, for
    example, but also in coordination with our Cybersecurity
    Intelligence Threat Integration Center. We ultimately
    coordinate the work that the community is doing in order to
    counter foreign malign influence.
        That is not something that CISA does. In other words, CISA
    is taking our products and the intelligence that we produce and
    is ultimately deciding what it is that needs to be, for
    example, shared with local and State partners, with industry
    depending on the cybersecurity threat or other things like
    that, in order to protect our critical infrastructure.
        So in a sense we do the normal Intelligence Community work
    that we do and they basically take that information. Hopefully
    we are supporting them in their mission to actually take action
    in response.
        Senator Schmitt. Okay. In your 2024 unclassified Annual
    Threat Assessment, you make several mentions of the threats of
    misinformation and disinformation. Specifically the report
    mentions adversarial State actors leveraging disinformation
    intended to propagate divisive societal issues to weaken
    America and our democracy. It also references medical
    disinformation as a threat to global health security.
        What are you doing here? Because as you know, a court has
    found that there has been great coordination between the
    Intelligence Community and Government Agencies to censor
    speech, in Missouri v. Biden, the Fifth Circuit, to censor
    speech, and so the determination was made that opinions about
    efficacy of masks or transmissibility of COVID after the
    vaccine was taken down at the behest of government actors.
        My big concern is, are you using this to quell dissenting
    points of view? Because I do not know what medical
    disinformation means and why, you know, if you are involved
    with censoring or limiting speech of Americans who may have
    different points of view, let's say if masks work or not. So is
    that what you are talking about with medical misinformation?
        Director Haines. So just a few things. I obviously do not
    play a lawyer in this position, but I would not accept your
    characterization of what the court has found.
        Senator Schmitt. Well, I actually was the lawyer--I was the
    attorney general that filed the lawsuit, so I am pretty
    familiar with that case.
        Director Haines. Okay. Understood. I am just saying that
    from my perspective the Intelligence Community does not, and
    has not, engaged in any sort of censorship of----
        Senator Schmitt. Well, okay. I have limited time, so let me
    just----
        Director Haines. But let me focus on----
        Senator Schmitt. Okay, sure.
        Director Haines.--the question you are asking, which is
    just basically in the context of medical disinformation, so for
    example, we saw Chinese efforts to ultimately engage in
    disinformation campaigns about the United States vaccine, for
    example, the quality of those types of vaccines, that
    ultimately if you take a different vaccine you might be better,
    the Russian efforts to do that as well. So that is the kind of
    thing----
        Senator Schmitt. Is medical misinformation, if I were to go
    online right now and say that masks are ineffective and they
    might actually hurt kids, is that medical misinformation?
        Director Haines. Well, you are not a foreign actor so that
    would not be foreign malign influence. What we would be looking
    for is a campaign from another country such as Russia and China
    engaging in disinformation about, for example, what I just
    described in the context of----
        Senator Schmitt. So just one last question. So obviously
    you work with the FBI, right?
        Director Haines. Absolutely. The FBI is actually part of
    the Intelligence Community.
        Senator Schmitt. Correct. Have there been any consequences
    to the FBI's prebunking of the Hunter Biden laptop story?
    Because we know that Elvis Chan was claiming that the Hunter
    Biden laptop, even though it was in the FBI's possession, was
    a, quote/unquote, ``Russian hack-and-leak operation.'' It was
    not, right. We know that it was not. But yet there are sworn
    affidavits now from senior executives of social media companies
    that said that it is exactly what they were told.
        Have there been any repercussions? Has anybody been fired
    for claiming this was a Russian hack-and-leak operation, when
    in fact it was Hunter Biden's laptop, and by the way the story
    got censored? Have there been any repercussions? Have you done
    anything about that?
        Director Haines. I suspect that we are not going to have
    the same characterization of the scenario either. But I am
    happy to take this offline and see if there is anything that we
    need to answer----
        Senator Schmitt. I hope so, because I have genuine concerns
    about the credibility of the Intelligence Community after what
    has come to light in that litigation. Anyway, but I am happy to
    talk to you about it more. I am out of time. Thanks.
        Chairman Reed. Thank you, Senator Schmitt.
        Senator Blumenthal, please.
        Senator Blumenthal. Thanks, Mr. Chairman. Thank you both
    for being here and thank you for your service to our Nation.
        There have been reports, as recently as this morning, about
    potential progress in discussions with Saudi Arabia about a
    pact that in effect could lead to normalizing relations with
    Israel. Those discussions, I am aware, were underway before the
    October 7th attack, with great promise.
        Could you update us as to what you know about those
    discussions and whether an agreement with Saudi Arabia
    directly, without involving Israel in the first stage, is
    possible at this point?
        Director Haines. Thank you, Senator. I could not. The
    Intelligence Community is not involved in those discussions,
    but I am happy to defer that, obviously, and we can get you an
    answer from the policy community.
        Senator Blumenthal. Thank you. On Iran, I am somewhat
    perplexed about what you say in your report--Iran is currently
    not undertaking the key nuclear weapons development activity
    necessary to produce a testable nuclear device. But then you
    say Iran continues to increase the size and enrichment level of
    its uranium stockpile, and so forth. Isn't Iran continuing to
    take steps that would put it in a position to have nuclear
    arms?
        Director Haines. Yes, I think we can probably talk about
    this more in closed session, but I think the distinction that
    is being made in the report, in that particular scenario, is
    basically to say that what they are doing is shortening the
    time period that it would take for them to actually, for
    example, enrich a sufficient amount of material for a nuclear
    weapon, if they make a decision to move forward on it, as
    opposed to actually having made a decision to move forward on
    it. Does that make sense?
        Senator Blumenthal. It does, and I guess that leads to the
    next question, which is what is the time period now that they
    have shortened to?
        Director Haines. Yes, I think we can discuss this in closed
    session.
        Senator Blumenthal. Okay. Could you talk a little bit about
    efforts to free Evan Gershkovich, the Wall Street Journal
    reporter currently imprisoned in Russia? Are we making any
    progress there?
        Director Haines. We are working on that. I think we can
    discuss that in closed session.
        Senator Blumenthal. Which leads to my next question. There
    is a lot of public interest in it, and I have long felt that
    there is overclassification of information. As you know, the
    present system dates from, I think it is Harry Truman.
    Executive orders in terms of classifications of different
    materials are, in my view, very antiquated. I have been to
    countless classified briefings in the SCIF, and I have read
    about them the next day, or the previous day, in the New York
    Times or wherever. Aren't we overclassifying information?
    Shouldn't we be disclosing more of it?
        What I find--and I say it in these briefings--our
    adversaries know what you are telling us about them. We know
    our adversaries know all about it. They know we know. The only
    people who do not know are the American people. Aren't we
    overclassifying?
        Director Haines. Yes, I have been very public in saying
    that overclassification is an issue, and it is one that we are
    working quite hard on. It is not going to be solved quickly
    because it is actually, there are a lot of institutional issues
    that are at stake and challenging. One of the things that we
    are doing, for example, is related to the fact that we
    recognize we produce an enormous amount of information. Some of
    it gets declassified over time. It is necessary for us to get
    that information out. We are trying to use technology in a more
    productive way to actually ensure that we are doing this at a
    more rapid rate. We have had some progress on this, and there
    is actually money in our current budget proposals to try to
    increase the amount of technology and work that we can do in
    this area to ensure that we are pushing out information that
    should be pushed out.
        We are working with our FOIA offices to basically ensure
    that they are better staffed, that they are in a position to be
    able to do more work, more quickly, prioritize what is of the
    highest public interest. We are working to try to ensure that
    we actually incentivize, to the greatest extent possible,
    accurately classifying things, not overclassifying things, et
    cetera.
        I am happy to share we have got a lot of lines of effort,
    frankly, on this issue, to try to improve the situation.
        Senator Blumenthal. Just one last quick question on Evan
    Gershkovich. Are we making progress, or not?
        Director Haines. Honestly, this is not an area where I am
    involved in the specific talks, and I would rather, yes.
        Senator Blumenthal. Okay. Thank you.
        Chairman Reed. Thank you, Senator Blumenthal.
        Senator Budd, please.
        Senator Budd. Thank you, Chairman. General, Director, thank
    you both for being here today.
        Director Haines, the Annual Threat Assessment, it states
    that the Intelligence Community assesses that, and a quote from
    there is, ``that Iranian leaders did not orchestrate, nor had
    foreknowledge of the Hamas attack against Israel.'' So how
    confident are you about that assessment, and to the extent that
    you can discuss it here, how has October 7th impacted the
    relationships and operations of the broader Iranian threat
    network?
        Director Haines. Sure. I can give a start at this and
    General Kruse may have more to add too. I mean, I think we are
    reasonably confident, and growing more confident over time,
    that that assessment is correct with respect to their
    foreknowledge of the attack. Then in terms of the relationship
    impact that it has had, as you indicate, I think it has
    certainly increased the degree of work that is being done
    between, for example, Iran and the Houthis. That was obviously
    a long-standing relationship, but that one continues to build,
    and the Houthis are increasingly relying on Iran for assistance
    in their capacity for weapons systems and so on, and to make
    them more precise, in many respects.
        It has certainly continued. I mean, I think the
    relationship with the Iranian-aligned militia groups, as we
    often refer to them, within the region, these are classically
    Shia militia groups that have been working with Iran that get
    money, training, weapons systems, and so on from them. We
    continue to see that relationship. I do not know that it has
    had an enormous impact on the relationship since October 7th,
    but it has been one that has been quite active, obviously,
    during this period, and they have been assisting in the sort of
    strategy that Iran has taken with respect to the conflict in
    the region during this period.
        I would say that the relationship remains strong between
    Iran and Hezbollah. That continues to be a key partner from
    their perspective and one that they rely on to manage security
    in the region in many respects, from their perspective. I guess
    that is sort of a general waterfront landscape----
        Senator Budd. I am going to ask another part to that
    question, Director. Since October 7th, Iran has encouraged and
    enabled its proxies to conduct strikes against Israel and then
    also United States interests. In fact, we saw more than 100
    attacks against United States Forces in the Middle East,
    including the killing of three American soldiers. These attacks
    have dissipated, but they seem to have started again.
        Director, what is the IC's assessment of whether the Iran
    threat network will renew a campaign of attacks against United
    States Forces, or has some level of deterrence been
    established? Director, we will start with you, and General, if
    you would add in.
        Director Haines. Okay. Yes, currently they continue to sort
    of be in this pause. The question of how long it will last is
    unknown to us, but here are some of the factors that I think
    are relevant to it.
        One is the Iranians have really been focused on pressuring
    the Iranian threat network, as you call it, the Iranian-aligned
    militia groups, on Israel, as you pointed out. That is sort of
    their primary instruction, in many respects, and what has
    really, in part, been driving the Iranian militia groups in
    this scenario, particular the Iraqi groups, has been also to
    drive United States Forces out of the region, and coalition
    forces out of the region, but particularly United States
    Forces.
        So how the talks with the Higher Military Commission go,
    how the conversation goes in Iraq, and how much Sudani is able
    to manage that, President Sudani, will make a difference to
    essentially the calculus of those groups and whether or not
    they initiate continued attacks, is sort of where we are on
    this. But we will continue to watch this, and we do think,
    obviously, that the pause reflects a certain amount of
    deterrence that has been established during this period. But
    again, these factors can adjust that, and it is possible for it
    to start as any time as a consequence of that discussion.
    Please.
        General Kruse. I would probably just echo. The point I
    would have made would have been the Iraqi connection and what
    the drivers are and the calculus of the Iranian threat network
    and the Iranian-aligned militia groups.
        Then the deterrence I think that we have seen temporarily,
    it is a fleeting piece and needs to be refreshed and renewed or
    rediscussed, and it is the variables that the Director laid out
    that I think will drive that.
        Senator Budd. Thank you. Bottom line, in the interest of
    time, could you describe the threats from Hamas and Hezbollah
    to the homeland and how they have evolved since October 7th,
    Director?
        Director Haines. Yes. I mean, in many respects the greatest
    threat that they pose to the homeland is the degree to which
    they inspire folks within the homeland to conduct attacks, and
    also for other groups. As I mentioned in my opening remarks, al
    Qaeda and ISIS have basically directed, in a sense, renewed
    instructions to continue to go against United States interests.
    So that is more of the impact that they are having with respect
    to the homeland at this point. But over time that will develop,
    and I do not want to suggest in any way that the
    counterterrorism concerns that we have are significant at this
    point.
        Senator Budd. Thank you.
        Chairman Reed. Thank you, Senator Budd.
        Senator Peters, please.
        Senator Peters. Thank you, Mr. Chairman. Director Haines,
    as you know all too well, rapid technological improvement like
    artificial intelligence and advanced photo editing is allowing
    malicious actors to spread very sophisticated deepfakes of
    photos, videos, auto-recordings. A notable example of that was
    a video that was circulated in early 2022, depicting Ukrainian
    President Zelensky appearing to surrender Russia troops in that
    deepfake.
        In response to similar incidents, several Fortune 500
    companies have created a Coalition for Content Prominence and
    Authenticity to address these threats and to verify the origins
    of digital content. In support of their efforts I was pleased
    to include a pilot program in the fiscal year 2024 NDAA for the
    DOD to assess the feasibility of establishing content standard
    technologies on DOD-produced and owned media content, which can
    be used by malicious forces.
        So my question for you, Director Haines, is, with thousands
    of Government websites containing digital content easily
    altered by our adversaries, how concerned are you about the
    proliferation of deepfakes and the resulting impacts on our
    national security?
        Director Haines. Thank you, sir. I am very concerned about
    the proliferation of deepfakes and the capacity to use
    generative AI and other technologies, basically, to improve
    information operations, and I think that is true just across
    the board. As you indicated, there was the example that we saw
    in the context of Ukraine. There was also a deepfake audio
    recording that we saw in the Slovakian parliamentary elections
    that had impact. There are a variety of examples now of these
    types of things being produced, and whether they are produced
    from information that is available through a Government website
    or otherwise, frankly, they are a challenge.
        Senator Peters. Director Haines, I chair the Homeland
    Security Committee, and I am keenly aware of the current and
    emerging threats associated with unmanned aircraft systems,
    both for the homeland as well as our folks abroad. Major
    technological investments are going to be clearly needed to
    combat these risks. But just as importantly, we need to
    actually synchronize all of our fragmented interagency efforts.
        So my question for you is, how is the Intelligence
    Community coordinating and sharing intelligence with your
    interagency partners to mitigate these UAS threats, and in
    response if you could tell us any roadblocks that you are
    facing in those coordination efforts to get everybody on the
    same page.
        Director Haines. Thank you, sir. Obviously you know that
    the Department of Defense has a counter-UAS strategy. We have
    nested essentially against that. We do these sorts of unified
    intelligence collection strategies, and it is intended to
    support that strategy. That is sort of how we organize
    ourselves to ensure that we are, in fact, supporting the work
    that is getting done at DOD, but also in other parts of the
    U.S. Government on these issues.
        We really have not encountered so much challenges in the
    context of interagency cooperation or sharing in this space but
    more in the sense of just actually going after the problem,
    ensuring that we are actually getting the information that we
    need for supporting them, and also including talking to private
    sector and others who may have knowledge about some of the
    technologies that are being used, mapping out supply chains so
    that we can help to disrupt issues, things along those lines.
        Senator Peters. Very good. General Kruse, Russian
    disinformation efforts, including attempts to influence EU
    elections and spread harmful propaganda are being used to
    achieve military objectives in the war in Ukraine.
        My question for you sir is, what specific lessons has DIA
    gained from Russia's ongoing information operations?
        General Kruse. So there are probably a couple, and I think
    I would even add to your question to say what have some of our
    other adversaries learned from Russian misinformation
    campaigns. I worry probably less about our ability to how do we
    detect some of these pieces, which in partnership with the rest
    of the community, I think we are able to identify a lot of that
    data. The issue is how do you counter it, what is the pathway
    by which you can authoritatively say something is fake and then
    provide it to the people in an authoritative way.
        The piece that I do worry about is what are the Chinese
    learning, what are the Iranians learning, what does the impact
    of disinformation mean on all future battle spaces, or in the
    lead-up to future conflicts, which drives the need to really
    get our arms around how do we effectively and efficiently
    detect deepfakes and other pieces and have a dissemination
    system in the same way that we do with traditional
    intelligence.
        Senator Peters. Thank you. Thank you, Mr. Chairman.
        Chairman Reed. Thank you very much, Senator Peters.
    Director, General, thank you for your excellent testimony. We
    will now adjourn the open session and we will reconvene, let's
    shoot for 12 noon in SVC-217.
        With that I will adjourn the open session.
        [Whereupon, at 11:44 a.m., the Committee recessed, to be
    continued in closed session.]

        [Questions for the record with answers supplied follow:]

                 Questions Submitted by Senator Mazie K. Hirono
                       misinformation with maui wildfires
        1. Senator Hirono. Director Haines and General Kruse, there were
    reports that misinformation was used after the Maui Wildfires to spread
    distrust of Federal Emergency Management Agency (FEMA). Do you have any
    more information on these incidents and if Russia was responsible?
        Director Haines. [Deleted.]
        General Kruse. DIA defers this question to the Office of the
    Secretary of Defense.

        2. Senator Hirono. Director Haines and General Kruse, how can we
    address or combat these misinformation campaigns that may affect
    responses to future natural disasters?
        Director Haines. [Deleted.]
        General Kruse. DIA defers this question to the Office of the
    Secretary of Defense.
                  climate change and environmental degradation
        3. Senator Hirono. Director Haines, it is clear climate change
    contributes to global instability, and its effects are particularly
    acute for developing countries. Environmental disasters can weaken
    government institutions, causes migration, and force communities to
    turn to illegal activities to survive. As climate change intensifies,
    what additional national security challenges do you see it causing in
    the United States?
        Director Haines. [Deleted.]

        4. Senator Hirono. Director Haines, as sea ice recedes in the
    Arctic, competition over access and economic resources will increase.
    What is the Intelligence Community's assessment of how countries,
    particularly Russia and China, will attempt to leverage these changes?
        Director Haines. [Deleted.]
                       lines of communication with china
        5. Senator Hirono. Director Haines, a couple weeks ago, Defense
    Secretary Lloyd Austin spoke with his Chinese counterpart for the first
    time since November 2022. Increasing the amount of bilateral dialog,
    especially military-to-military lines of communication, is critically
    important to avoid miscalculation and reduce the risk of an escalatory
    military encounter. Why do you think China has been reluctant to
    consistently engage in conversations with our senior military leaders?
        Director Haines. [Deleted.]

        6. Senator Hirono. Director Haines, what is the Intelligence
    Community's assessment of the likelihood of these conversations
    becoming more frequent in the future?
        Director Haines. [Deleted.]
                     china's influence in the indo-pacific
        7. Senator Hirono. Director Haines, the annual threat assessment
    states China is ``considering pursuing military facilities in multiple
    locations, including--but not limited to--Burma, Cuba, Equatorial
    Guinea, Pakistan, Seychelles, Sri Lanka, Tajikistan, Tanzania, and the
    UAE [United Arab Emirates].'' How do you think China's establishment of
    overseas military installations and access agreements will affect our
    national security?
        Director Haines. [Deleted.]

        8. Senator Hirono. Director Haines, our network of allies and
    partners is the greatest asymmetric advantage we have in the long-term
    strategic competition with China. This network is sustained by mutually
    beneficial cooperation on issues not merely related to defense. How
    have the Chinese reacted to these initiatives and what is your
    assessment of their ability to successfully do the same?
        Director Haines. [Deleted.]
                                   __________
                   Questions Submitted by Senator Jacky Rosen
                                  antisemitism
        9. Senator Rosen. Director Haines, given the troubling rise in
    antisemitism here at home and around the world, can you elaborate on
    how our adversaries like Russia and China are amplifying antisemitic
    narratives to create further divisions in the United States and how are
    they using antisemitism to further their strategic interests?
        Director Haines. [Deleted.]
                               foreign influence
        10. Senator Rosen. Director Haines, news reports in recent years
    highlight efforts by Huawei and foreign government-owned companies to
    build telecommunications infrastructure or purchase land near
    intercontinental ballistic missile (ICBM) fields, U.S. military
    installations, training ranges, and sensitive national security areas,
    for intelligence collection purposes. Discuss the threat this
    intelligence gathering poses and how the Intelligence Community works
    alongside the Federal Bureau of Investigation (FBI) to mitigate these
    threats?
        Director Haines. [Deleted.]
                                   __________
                 Questions Submitted by Senator Michael Rounds
                                    spectrum
        11. Senator Rounds. Director Haines and General Kruse, are you
    aware of any, or of the Chinese efforts to encourage other nations to
    build out their 5G infrastructure on the 3.1 to 3.45 gigahertz portion
    of the spectrum?
        Director Haines. [Deleted.]
        General Kruse. China does encourage other nations to use the 3.1 to
    3.45 gigahertz (GHz) portion of the radiofrequency spectrum. This
    frequency range falls into the industry standard ``Mid-Band'' for 5G,
    covering 1GHz-6GHz. Mid-Band is the ideal range to balance coverage,
    bandwidth, and speed requirements for most 5G applications, and many
    countries worldwide have already designated it for 5G, particularly in
    the 3.3 to 3.8 GHz range.
        [Deleted.]
                                   __________
                  Questions Submitted by Senator Dan Sullivan
                          arctic intelligence efforts
        12. Senator Sullivan. Director Haines, does the Intelligence
    Community (IC) have sufficient resources to collect on the People's
    Republic of China (PRC) and Russian activities in the Arctic?
        Director Haines. [Deleted.]

        13. Senator Sullivan. Director Haines, the Annual Threat Assessment
    mentions the growing relationship between Beijing and Moscow in regards
    to accessing the Arctic. Is the IC able to maintain persistent
    collection on Russian and Chinese vessels engaged in military
    activities and natural resource activities in the Arctic?
        Director Haines. [Deleted.]

        14. Senator Sullivan. Director Haines, would an icebreaker provide
    the IC an ability to collect on Russian and Chinese activities in the
    Arctic in a meaningful way that overhead resources cannot?
        Director Haines. [Deleted.]
                    domestic supply for energy and minerals
        15. Senator Sullivan. Director Haines, has the IC conducted a
    critical and strategic minerals supply chain assessment to determine
    U.S. supply chain vulnerabilities in the event of a conflict with the
    PRC?
        Director Haines. [Deleted.]
                      chinese and russian economic outlook
        16. Senator Sullivan. Director Haines and General Kruse, both the
    PRC and Russia have experienced economic disruptions due to a variety
    of factors, including United States sanctions and tariffs. How do your
    organization assess PRC and Russian economic vulnerabilities that have
    the greatest impact on their respective military capabilities?
        Director Haines. [Deleted.]
        General Kruse. [Deleted.]
                     wartime economies and defense spending
        17. Senator Sullivan. Director Haines and General Kruse, how much
    are Russia and the PRC spending on defense each year?
        Director Haines. [Deleted.]
        General Kruse. DIA Response for Russia: Moscow released budget
    information indicating that it intends to spend about $120 billion on
    defense in 2024, which is nearly a 61 percent increase from the
    previous year.
        [Deleted.]

        18. Senator Sullivan. Director Haines and General Kruse, will you
    commit to producing unclassified assessments of total national security
    spending for Russia and the PRC?
        Director Haines. [Deleted.]

        General Kruse. DIA Response for Russia: [Deleted.]
        DIA Response for China: Yes.
        [Deleted.]

        19. Senator Sullivan. Director Haines, Russia is reportedly
    spending 7 percent of its gross domestic product (GDP) on defense. The
    same is publicly reported for China, although the true number may be
    higher. Does the IC make any assessments on the sustainability of that
    level of spending and its impact?
        Director Haines. [Deleted.]

        20. Senator Sullivan. Director Haines and General Kruse, how many
    analysts in your organization are focused on assessing PRC military
    spending, including dual-use technologies, the PRC Coast Guard, and PRC
    maritime militias?
        Director Haines. [Deleted.]
        General Kruse. [Deleted.]

        21. Senator Sullivan. Director Haines and General Kruse, do you
    believe the number of analysts assigned to assess PRC military spending
    is adequate to appropriately inform policymakers?
        Director Haines. [Deleted.]
        General Kruse. [Deleted.]

        22. Senator Sullivan. Director Haines and General Kruse, do you
    believe the number of analysts assigned to assess PRC military spending
    is adequate to appropriately inform policymakers?
        Director Haines. [Deleted.]
        General Kruse. [Deleted.]

        23. Senator Sullivan. Director Haines and General Kruse, in your
    opinion, is the United States spending an appropriate percentage of GDP
    on defense to counter the PRC?
        Director Haines. [Deleted.]
        General Kruse. DIA defers this question to the Office of Secretary
    of Defense.

        24. Senator Sullivan. Director Haines and General Kruse, in your
    opinion, would greater United States defense spending improve our
    ability to deter the PRC from invading Taiwan?
        Director Haines. [Deleted.]
        General Kruse. DIA defers this question to the Office of Secretary
    of Defense.

        25. Senator Sullivan. Director Haines, in your opinion, what
    negative impact, if any, did the delay in passing the Fiscal Year 2024
    National Security Supplemental have on how the PRC views our deterrence
    efforts in the Indo-Pacific?
        Director Haines. [Deleted.]
                                iranian proxies
        26. Senator Sullivan. Director Haines, have Iranian warships,
    either Islamic Republic of Iran Navy (IRN) or Islamic Revolutionary
    Guard Corps Navy (IRGCN), provided targeting data to the Houthis that
    have directly led to an attack on United States Navy ships?
        Director Haines. [Deleted.]

        27. Senator Sullivan. Director Haines, do you have any indications
    that Iran has attempted to reign-in its proxies?
        Director Haines. [Deleted.]
                              illicit drug supply
        28. Senator Sullivan. General Kruse, how are fentanyl precursor
    chemicals from China getting to Mexican Transnational Criminal
    Organizations (TCOs)?
        General Kruse. China-based chemical companies are the primary
    suppliers of fentanyl precursor chemicals to Mexico-based fentanyl
    producers. Despite the regulations on precursors implemented by Beijing
    in the past year, China-based chemical companies continue to advertise
    and sell 4-piperidone--the most crucial chemical in fentanyl
    production--and other precursors and essential chemicals, mainly
    through online marketplaces. Similarly, chemical brokers and Mexico-
    based transnational criminal organizations (TCOs) continue to employ
    deceptive shipping techniques, bribe government officials, and shift
    synthesis formulas to other nonregulated precursors to circumvent law
    enforcement efforts.
        China-based chemical company employees, independent facilitators,
    and wholesalers sell precursor chemicals to Mexico-based brokers, TCOs,
    or independent buyers, according to open source reporting. These
    recipients make payments to chemical companies and brokers directly
    through bank wire transfers, cryptocurrencies, or money service
    businesses.
        China-based suppliers arrange transportation through commercial
    air, freight forwarding companies, standard mail, and maritime
    shipping, and mislabel and disguise packages to obfuscate shipments,
    according to open source reporting. In addition, chemical suppliers
    ship precursor chemicals through third-party countries such as the
    United States and Germany for transshipment to Mexico to mask the
    nature and origin of the products.
        Mexico-based fentanyl producers import China-origin precursor
    chemicals through major Mexican ports of entry such as Mexico City
    International Airport, the maritime port of Manzanillo, and the Nuevo
    Laredo land port of entry.
        Mexico-based TCOs and a growing number of independent fentanyl
    producers continually adjust tactics to maintain access to precursor
    chemicals and production equipment, synthesize fentanyl, and move
    product into the United States. As of May 2023, Mexico-based TCOs had
    recruited chemists from Mexican universities to produce synthetic
    drugs. These chemists probably seek to experiment with synthesis
    methods to reduce reliance on internationally sourced precursors.

        29. Senator Sullivan. Director Haines, do illicit drugs sales in
    the United States fund other types of organizations that pose a threat
    to U.S. interests beyond TCOs?
        Director Haines. [Deleted.]
                                   __________
                    Questions Submitted by Senator Ted Budd
                 united states-israel intelligence cooperation
        30. Senator Budd. General Kruse, what intelligence cooperation
    between the United States, Israel, and our global and regional partners
    contributed to the successful interception of Iranian missiles and
    drones?
        General Kruse. [Deleted.]

        31. Senator Budd. Director Haines and General Kruse, how essential
    is the future of intelligence collaboration between the United States,
    Israel, and global and regional partners who worked to intercept
    Iranian missiles and drones to the protection of American national
    security interests and regional security?
        Director Haines. [Deleted.]
        General Kruse. [Deleted.]
                         chinese maritime capabilities
        32. Senator Budd. Director Haines, this year's annual threat
    assessment states, ``In the South China Sea, Beijing will continue to
    use its growing military and other maritime capabilities to try to
    intimidate rival claimants and to signal it has control over contested
    areas.'' Where should we expect to see China expand its intimidation
    campaign in the South China Sea outside of the Second Thomas Shoal?
        Director Haines. [Deleted.]

        33. Senator Budd. General Kruse, what is your assessment of the
    Chinese military's ability to conduct a cross-strait amphibious assault
    of Taiwan?
        General Kruse. The PLA is preparing its forces to be capable of
    compelling Taiwan to unify with China by force if Beijing perceives
    force is necessary, while simultaneously deterring or denying any
    third-party intervention, such as the United States and other like-
    minded partners, on Taiwan's behalf. As part of the military's
    preparation to hone contingency capabilities and signal Beijing's
    displeasure at deepening Washington-Taipei ties, the PLA has routinely
    conducted military operations near Taiwan and focused much of its
    training over the past several years on a Taiwan conflict. The PLA's
    lack of transparency about its modernization progress and plans limits
    the information available to discuss specific details on China's
    modernization efforts.
        [Deleted.]

        34. Senator Budd. General Kruse, the Chinese military has now
    effectively practiced a blockade. In your assessment, are they ready
    for a major amphibious landing yet?
        General Kruse. In May, the PLA's Eastern Theater Command announced
    Exercise JOINT SWORD-2024A following the inauguration of Taiwan's
    President Lai, which probably allowed the PLA to exercise some elements
    of a blockade. Having such a capability probably would enable a more
    permissive environment for an amphibious operation to take place,
    although it would not necessarily serve as a direct component of such
    an operation.
        The PLA's lack of transparency about its modernization progress and
    plans limits the information available to discuss specific details on
    its capabilities.
        [Deleted.]

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