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October 6 2012

October 8, 2012




White House to contractors: Hold off on layoff warnings

By Jeanne Sahadi @CNNMoney September 28, 2012: 6:51 PM ET

White House budget office made an effort to stave off layoff notices from companies worried about 2013 automatic spending cuts.

NEW YORK (CNNMoney) — The White House on Friday told government contractors worried about fiscal cliff spending cuts to hold off on warning employees about possible layoffs.

The government said it would cover legal costs if contractors are forced to slash their payrolls because of the looming $109 billion in automatic cuts next year and are alleged to have violated the WARN Act.

The federal WARN Act requires businesses with more than 100 employees to notify workers at least 60 days in advance of a mass layoff or plant closing. Some states require more notice.

“Any resulting employee compensation costs for WARN Act liability as determined by a court, as well as attorneys’ fees and other litigation costs (irrespective of litigation outcome) would qualify as allowable costs and be covered by the contracting agency, if otherwise reasonable and allocable,” the Office of Management and Budget said in its guidance.

Defense contractors in particular have warned for months that the upcoming sequester would cost jobs in their industry. And Lockheed Martin’s CEO has said publicly he may be forced to issue notice this fall of possible layoffs in 2013.

If other contractors follow suit, there could be a rash of layoff notices spooking employees right before Election Day.



Names Floated for Top Defense Jobs Under Romney

Defense News

Sep. 30, 2012 – 12:52PM   |  



With the U.S. presidential election just over a month away, the campaign of former Massachusetts Gov. Mitt Romney is quietly accumulating the names of potential candidates who could fill out Defense Department leadership roles — including current and former defense executives.

Names circulating among Romney aides include former SAIC CEO Walt Havenstein, CACI Chairman Jack London, EADS North America CEO Sean O’Keefe and Lockheed Martin Chairman and CEO Robert Stevens. Senior Romney defense advisers John Lehman, a former Navy secretary; former Rep. Vin Weber, R-Minn.; and former Pentagon comptroller Dov Zakheim also are frontrunners for top defense posts if Romney wins.

Stevens said he had not been involved in any conversations with the campaign about potential positions, and that he has no intention of entering government, regardless of which party wins in November.

“There has been no contact and no discussion whatsoever,” he told Defense News.

Stevens plans to step down as CEO on Jan. 1 but is slated to remain chairman of the board for another two years. He said he is looking forward to retirement.

“It shouldn’t surprise anybody that retirement can be just retirement,” he said. “I think I’d like to go out and enjoy some of the benefits of retirement that I personally think I’ve earned from a career focused on working.”

Havenstein also said he hasn’t reached out to the campaign — nor has it reached out to him — but he said he would be open to serving in any administration, if asked. As a lifelong Republican, he would prefer serving the former Massachusetts governor, whom he is helping in New Hampshire.

O’Keefe, who served under both Bushes, is widely regarded as a top candidate for any senior DoD job. He declined to comment for this article.

According to Jody Brown, CACI executive vice president for communications, “Dr. London, CACI’s chairman of the board, is active in representing and providing thought leadership on national security issues. However, there has been no discussion with him on this matter.”

Defense aides in both campaigns spend painstaking hours reviewing possible candidates for defense jobs. Those names are then submitted to top campaign officials. Intermediaries often play a key role, both feeling out potential candidates’ interest and making recommendations.

Stevens has been one of the more vocal critics of sequestration, and has criticized the Obama administration’s planning, or lack of it, as the cuts approach. He has also been one of the few executives to unambiguously confirm that he intends to issue layoff notices to employees, in compliance with the Worker Adjustment and Retraining Notification (WARN) Act, in preparation for sequestration.

But Stevens said characterizations by sources that he is “pissed off” at the administration, and therefore interested in working at DoD in a Romney administration, are inaccurate.

“Just the notion of my being quote ‘pissed,’ forgive me, is laughable on its surface,” he said. “The word isn’t pissed, the word is in part frustrated.

“But I am not the only person anywhere near this process that feels a frustration with sequestration, when so many in the House and the Senate, I think very clearly and very honestly, have stated their opposition to this process. That we haven’t found a remedy at this juncture is, I think, frustrating to them and frustrating to me.”

Concerns about any other industrialists’ backgrounds are being raised, but these are normal when it comes to selecting high-ranking defense officials. The Obama administration successfully installed William Lynn as deputy defense secretary, and he was able to perform the duties of the Pentagon’s No. 2 civilian job despite his ties to Raytheon.

As for whether former executives are good for the Pentagon, some believe the dual experience is beneficial.

“The reason that helps so much is that government doesn’t understand how industry works, and vice versa,” said Dave Oliver, a former principal deputy defense undersecretary for acquisition, technology and logistics.

Oliver, a defense adviser to President Barack Obama’s campaign, is the most prominent Democratic industrialist with an interest in returning to work at the Pentagon.

Oliver, who joined the DoD after a stint working for Northrop Grumman, said the lack of understanding means that having an executive move into government provides a knowledge bridge that is otherwise lacking.

“It’s really good to understand both sides of the aisle,” he said. “You understand where the pressures are and where to look for flaws. If you’ve had to play defense against something, you’re a better offensive player.”

Gordon England, who spent more than three decades in the defense industry before serving during the George W. Bush administration as Navy secretary, the deputy at Homeland Security and deputy defense secretary, agreed.

“My experience in industry was very valuable at the Department of Defense, giving me a familiarity with the product base, the technology and the complexity of the modern military,” said England, president of E6 Partners, a defense consulting firm that has advised Lockheed Martin. “The surprise is the sheer size and complexity of the organization.

“There is a very steep learning curve, even when you know the field and you have good mentors,” he said. “The Pentagon is like a country and is as complex. A lot of people think the Pentagon is all screwed up, but that’s not true. You can improve it, but it fields superb forces, magnificent people and great equipment and frankly is one of the better performing federal departments.”

There’s nothing new about senior business executives setting up shop as Pentagon leaders. Top auto executives such as Robert McNamara and Robert Wilson have served as defense secretary, and more recently, Donald Rumsfeld brought his experience as chief executive of a pharmaceutical giant.

The Obama administration, which was initially leery about putting defense executives in key Pentagon posts, ultimately hired Lynn and, when he left, replaced him with Ashton Carter, who was an industry consultant and board member of government think tank Mitre before joining the government. Current acquisitions chief Frank Kendall is a former Raytheon executive, and industrial policy chief Brett Lambert worked at defense intelligence firms for roughly two decades.

But neither the former nor current defense secretaries, Robert Gates and Leon Panetta, has any defense industry experience.

That contrasts with the way the Clinton administration set up its Pentagon leadership team, which included Defense Secretary William Perry, acquisition chiefs Paul Kaminski and Jacques Gansler, as well as Oliver, all of whom had

either led defense firms or divisions at major firms before taking those jobs.

The George W. Bush administration, in keeping with its philosophy of bringing a more business-minded focus to government and the Pentagon, picked each service secretary, as well as each acquisition and analysis chief, from defense contractors.

Just as England became Navy secretary after working at General Dynamics, James Roche, a retired Navy captain, left a top job at Northrop Grumman to become Air Force secretary. Thomas White, a retired Army brigadier general, left a senior post at Enron to take over as Army secretary and Dov Zakheim, once CEO of analytical firm SPC, became Pentagon comptroller.

Each of the more recently discussed industrialists has some prior connection to the military besides his industry experience. Stevens was an enlisted Marine, while Havenstein and London, both U.S. Naval Academy graduates, are retired military officers. Havenstein retired as a Marine lieutenant colonel and London retired as a Navy captain. None of the three has served in appointed Pentagon jobs, however.

In recent times, it has been unusual for executives to go straight to the top jobs without having worked at the Pentagon in junior capacities first.

Lynn was a senior Senate staffer before his time at the Pentagon during the Clinton administration — as the chief of program analysis and evaluation and later as comptroller — returning to DoD during the Obama administration as deputy secretary. O’Keefe was also a congressional staffer, then comptroller, then Navy secretary, and in George W. Bush’s administration led NASA.

That’s in contrast to someone like Stevens, who has none of that political experience.

Another potential issue for senior executives taking Pentagon jobs could be deferred compensation.

“I tried to hire a couple of guys when I was working for Jacques Gansler, and I couldn’t because the guy would say, ‘I’ll lose millions of dollars,'” Oliver said. “You get into guys making money and wanting to keep it, and they want Congress to give them special considerations. Congress sometimes looks askance at people who will draw retirement pay after they leave a company. They say, ‘Will he make a decision that could cause that company to go broke, and he would lose his retirement?'”

England said too much is made of conflicts. Once people take a Pentagon job, their old affiliations cease.

“When people move from industry to DoD, they know their responsibility is to DoD and the nation and quickly separate themselves from their prior job,” he said. “When you go in there, you are in the throes of tomorrow’s problems, not getting wrapped up in old issues.”

Indeed, during the first George W. Bush term, then-Air Force Secretary Roche fought his former employer to block the purchase of additional B-2 stealth bombers.

“It comes with the territory; you’ve got to make tough calls that not everyone will like,” England added.

And given the nation’s financial challenges, the new team at the Pentagon will have to tackle global challenges on a tighter budget but also spearhead further reforms to acquisition, processes, personnel and benefits.

John T. Bennett contributed to this report.



OMB Directs Federal Agencies to Ignore Sequester for Now


Sept. 28, 2012 – 6:37 p.m.

By Kerry Young, CQ Staff


The White House is ordering federal agencies to plan for spending in the coming fiscal year as if Congress will undo the looming scheduled automatic budget cuts known as the sequester.

The Office of Management and Budget on Friday said, “Agencies should continue normal spending and operations” in early fiscal 2013, which begins Oct. 1. This message came as part of a document OMB routinely issues each year in late September detailing how federal agencies should operate under stopgap continuing resolutions.

But the OMB guidance for fiscal 2013 comes with a few special wrinkles. The CR (H J Res 117), which President Obama signed into law on Friday, covers almost all federal operations and does so for six months, a far longer period than most CRs.

In its bulletin on this CR, too, OMB had to at least mention the threatened sequester, if only to largely tell agencies to ignore it — for now.

“If necessary, the bulletin will be amended to address that sequestration,” OMB said.

With the notice to agencies on the fiscal 2013 CR, OMB also repeated the Obama administration’s demand that Congress pass a “balanced package of deficit reduction” so that the automatic, across-the-board cuts built into last year’s debt-limit accord (PL 112-25) can be replaced with a more deliberate approach to budget cutting.

Unless Congress acts to block the sequester, OMB in January will need to trigger the actions needed to make $109 billion in cuts for the fiscal 2013 accounts of most federal programs. Republicans and Democrats alike have decried this as a blunt tool for making such reductions, and there have been calls from groups across the political spectrum to delay or block the sequester.

Yet, it remains far from clear that Congress will be able to reach a compromise on the sequester after the November election.

Republicans want to replace the cuts with alternative reductions, and the GOP-led House passed a budget resolution this year that would sharply curtail domestic spending while eliminating the cuts to the Defense Department that would come under sequester. Democrats insist on what they call a balanced approach that would include higher tax revenues and alternative cuts to replace sequestrations.

OMB in July issued a special report to federal agencies saying that although President Obama “remains confident that Congress will act,” lawmakers have not “made progress towards enacting sufficient deficit reduction.”

OMB said, instead, that it planned to work with agencies to plan for potential budget cuts. This preparation would not “change the fact that sequestration is bad policy, was never meant to be implemented, and should be avoided through the enactment of bipartisan, balanced deficit legislation,” OMB said in its July memo.


White House secret meetings examine al-Qaeda threat in North Africa

Washington Post

By Greg Miller and Craig Whitlock, Published: October 1


The White House has held a series of secret meetings in recent months to examine the threat posed by al-Qaeda’s franchise in North Africa and consider for the first time whether to prepare for unilateral strikes, U.S. officials said.

The deliberations reflect concern that al-Qaeda’s African affiliate has become more dangerous since gaining control of large pockets of territory in Mali and acquiring weapons from post-revolution Libya. The discussions predate the Sept. 11 attacks on U.S. compounds in Libya but gained urgency after the assaults there were linked to al-Qaeda in the Islamic Maghreb, or AQIM.

U.S. officials said the discussions have focused on ways to help regional militaries confront al-Qaeda but have also explored the possibility of direct U.S. intervention if the terrorist group continues unchecked.

“Right now, we’re not in position to do much about it,” said a senior U.S. counterterrorism official involved in the talks. As a result, he said, officials have begun to consider contingencies, including the question of “do we or don’t we” deploy drones.

The effort has been led by White House counterterrorism adviser John O. Brennan and involves top officials from the CIA, State Department and Pentagon. At the same time, the U.S. military commander for Africa has crisscrossed the region in recent weeks, making stops in Mauritania, Algeria and other countries that could become part of a peacekeeping force for Mali.


White House officials declined to comment.

Army Gen. Carter F. Ham, chief of U.S. Africa Command, said Friday during a visit to Morocco that there “are no plans for U.S. direct military intervention” in Mali. But he and others have made clear that the United States is prepared to support counterterrorism or peacekeeping operations by other countries.

In addition, the U.S. military has launched a series of clandestine intelligence missions, including the use of civilian aircraft to conduct surveillance flights and monitor communications over the Sahara Desert and the arid region to the south, known as the Sahel.

The burst of U.S. activity reflects a reappraisal of a terrorist group long considered one of the weaker al-Qaeda offshoots. AQIM grew out of an insurgency in Algeria. It has been known mainly as a local scourge, using kidnappings and other crimes to support its effort to impose Islamist rule.

That perception has changed in the past year, largely because of the group’s ability to exploit regional political chaos. A coup in Mali divided the landlocked country, enabling AQIM and other insurgent movements to take control of cities in the northern part of the country, including Gao and Timbuktu.

At the same time, the overthrow of dictator Moammar Gaddafi in Libya triggered a migration of African mercenaries and their weapons back to countries where al-Qaeda elements are based. Secretary of State Hillary Rodham Clinton described the trend lines in stark terms at the United Nations last week.

With “increased freedom to maneuver, terrorists are seeking to extend their reach and their networks in multiple directions,” Clinton said. She said the United States was “stepping up our counterterrorism efforts” to combat what she described as “a threat to the entire region and to the world.”

U.S. officials said they are reexamining AQIM’s potential in part to avoid earlier mistakes underestimating an al-Qaeda franchise based in Yemen.

The question looming over the White House discussions, a senior U.S. intelligence official said, is: “Do you see AQIM being in the same place AQAP was five years ago?”

Al-Qaeda in the Arabian Peninsula, as the Yemen-based affiliate is known, was similarly discounted as a regional menace until it was linked to the attempted bombing of a Detroit-bound plane on Christmas in 2009.

It took more than year for the United States to mount a full-scale campaign against the Yemen group, using armed drones operated by the U.S. Joint Special Operations Command and the CIA. The United States has carried out 33 airstrikes in Yemen this year, according to independent estimates. Even so, AQAP has continued to attempt attacks, including an airline bomb plot disrupted earlier this year.

Some counterterrorism experts voiced concern that the administration is inflating the threat posed by al-Qaeda in North Africa. Although a small number of AQIM fighters were involved in the siege of U.S. facilities in Benghazi, Libya, last month, U.S. intelligence officials said they see no indication the attacks were directed by the organization.

“AQIM has always been way more talk than action,” said a former senior U.S. counterterrorism official who tracked the organization until earlier this year. The group was for years known among analysts as “the most underperforming affiliate of al-Qaeda.”

Officials stressed that no decisions have been made about deploying armed drones or other lethal assets. The nearest U.S. drone base in Africa is across the continent in Ethi­o­pia, and administration officials said they would consider unilateral strikes only as a last resort.

For now, the officials said, the emphasis is on replicating aspects of the counterterrorism formula in Somalia. The United States has conducted intelligence operations there, as well as strikes, but has mainly relied on African troops to battle an al-Qaeda-linked militant group known as al-Shabab.


Ham, the U.S. commander in Africa, has said that in Mali, that task has been made more difficult by political instability and the failure to act earlier. The United States, the Malian government and other countries “missed an opportunity to deal with AQIM when they were weak,” Ham told reporters during a visit to Senegal in July.

He called AQIM the “best-funded, wealthiest” affiliate, thanks to its lucrative practice of kidnapping foreigners for ransom and its smuggling prowess.

The Pentagon has been prohibited from giving military aid or training to Mali in the aftermath of the March coup. The ban, imposed by the State Department, is unlikely to be lifted until a democratically elected government can be reinstated.

In the meantime, the administration has been stepping up its military aid to Mali’s neighbors, including two that have been dealing with refugees and other spillover effects from the conflict there.

In July, the Defense Department allocated $6.9 million worth of military trucks, uniforms and communications gear for Mauritania. It also agreed to give Niger $11.6 mllion in equipment, primarily in the form of two Cessna airplanes that can be used for surveillance and to transport troops.

That same month, about 600 U.S. troops organized and led a joint military exercise, dubbed Western Accord 2012, with several West African nations, including Senegal, Burkina Faso, Guinea and Gambia. French troops also participated.

The Africa Command has continued to operate surveillance flights — under a classified program code-named Creek Sand – from a U.S. Special Operations forces base in Burkina Faso.

Senior U.S. officials said there was no American involvement in a reported June airstrike in northern Mali and that they still don’t know whether it occurred. Regional news organizations described a “mystery airstrike” that killed seven AQIM-aligned fighters traveling in a convoy of four vehicles.

Mali’s interim government has said that it would welcome a proposed peacekeeping force of about 3,300 troops from a 15-nation consortium known as the Economic Community of West African States.


Attack Operations For Iran Weighed

By David Fulghum

Source: Aviation Week & Space Technology

October 01, 2012

Aerial bombing of Iran’s nuclear and missile programs offers little political, deterrent or military value. That judgment encompasses bombing raids by either Israel or the U.S., contend a growing number of U.S. analysts.

There is evidence that patience on the part of the West may provide less-obvious opportunities to delay or halt the programs. But Israel fears that U.S. caution will turn into a containment policy that will enable Tehran to build a nuclear weapon.

“If the Iranians really wanted a store of enriched uranium, they could buy it,” says a longtime U.S. defense specialist with links to the U.S. military’s world of clandestine operations. “And they don’t have to process it themselves except for the national prestige it would give the country and to keep the international spotlight on Tehran.”

In fact, North Korea and Iran agreed to broad technology exchanges during an August meeting in Tehran of nonaligned nations. Large numbers of North Korean scientists have been traveling to Iran. The agreement calls for cooperation in research, student exchanges, and joint laboratories in the areas of information technology, engineering, biotechnology and renewable energy.

Probably the only nation to profit from an attack on Iran would be Russia, where declining oil prices are slowing the economy.

“The price of oil goes up if there is an attack on Iran,” says Steven Pifer, director of the Brookings Institute arms control initiative. And while Russia’s sale of its long-range SA-20 (S-300) surface-to-air missile to Iran remains a “dead issue,” Moscow has “not seen a precautionary tale” in the fact that its advanced-capability, man-portable SA-18s and SA-24s have migrated from military customers into the black market and into the hands of militants in Somalia, South Lebanon and Gaza, says Pifer. He predicts such sales will continue.

Nonkinetic cyberattacks cooperatively developed, financed and launched by the U.S. and Israel did delay the Iranian nuclear program for five or more years, says the U.S. defense specialist, but the eventual outing of the “Stuxnet” cyberattack and “Flame” cyber-reconnaissance programs allowed Iran to start organizing its cyberdefenses.

To defend against cyberattacks, the Iranian government has begun installing a network that is separate from the Internet to better control information flow, according to a report by the University of Pennsylvania’s Center for Global Communications Studies. Critical government and military agencies are expected to be on the network by the end of the month, according to the Washington Post. Project researchers say they already have evidence of a filtering capability. The technology is provided by China’s Huawei corporation, the investigation finds.

“But it’s a fencing match [that is standard in the world of electronic warfare],” the U.S. specialist says. “Now that they know our secret sauce [with discovery of the Stuxnet and Flame cyberintrusions], they’ve made it much harder to do.”

So if the path for nonkinetic, cyberattacks is blocked by new technology, what could the U.S. and Israel do to slow Iran’s progress?

“Kinetic attack [with aerial bombs or other explosives] is one of the few options left, but you need a lot of critical information to make an air attack on a deeply buried target work,” says a senior U.S. Air Force official.

Some of those options are already in play. On Sept. 17, Fereydoun Abbasi, Iran’s vice president and nuclear energy agency chief, said the electrical transmission lines between Qom and the Fordow nuclear enrichment facility (buried under a mountain) were severed with explosives, as were the power lines leading to the country’s other underground enrichment facility at Natanz.

So far, Western justification for attacking Iran’s nuclear development and delivery programs has been associated with the need to stop those efforts or create long delays. The goal is to ensure that sufficient enriched uranium cannot be processed to make nuclear weapons that could be delivered by missiles or even by trucks. Once the weapons are assembled and armed, they are difficult to keep track of, even by those who possess them.

Deputy Defense Secretary Ashton Carter, for example, was once part of a program to control chemical and biological weapons by making audits of what actually existed and where.

“The investigators found out that not even the senior Soviet leaders knew what they had or where it was hidden,” the U.S. specialist says. “Nuclear materials are the same. If Iran wanted to, it could get all the enriched uranium it wanted on the black market. If it wanted to focus solely on possessing a bomb, it could buy one.”

The technology to create effects against a truly deep underground facility, short of a nuclear weapon, does not exist. “We keep inventing and improving penetrating bombs,” says the U.S. defense specialist. “We’ve hardened them and we’ve boosted them and we’ve only increased the amount of the deeply buried target set we can defeat by a fraction. And right now the Israeli capability against deeply buried targets is not much more than a noise-level effect.”

As a result, the enthusiasm for a U.S. attack on Iran is negligible, and the technological ability for Israel to create the necessary effects is not much greater.

“I don’t see the U.S. initiating any near-term action,” the U.S. specialist says. “The Israelis are unlikely to do it on their own.”

In the meantime, the U.S. is intent on conducting defensive battleship diplomacy with its buildup of warships near the Strait of Hormuz.

“The wild card is if the Israelis create some unique capability that makes the Iranian facilities more reachable, or if there is some unexpected intelligence about a critical bottleneck that the Israelis could get to that stops [weapons] development,” he says.

A budding politician, former chief of staff of the Israel Defense Forces Lt. Gen. (ret.) Dani Halutz, volunteered his expectation that “no one will surprise anyone in the near future.” He had been asked about the possibility of a surprise Israeli attack before the November elections in the U.S.

Others expect such a move soon after, however.

“There will likely be military action, probably after the U.S. elections, with or without the help of the U.S.,” Ephraim Asculai, senior research fellow at Tel Aviv University’s Institute for National Security Studies, tells Aviation Week. That decision will be driven by Israeli government fear that the “U.S. will accept [political] containment of Iran despite it having nuclear weapons. That’s not a good choice in the case of Iran because the regime is very unpredictable.”

The U.S.—but not Israel—would have the advantage of being able to employ cruise missiles, large penetrating weapons and stealthy, high-flying bombers.

“I believe Obama when he says he won’t allow Iranian nuclear weapons, but the U.S. red line [for action] is an actual break-out” in producing weapons-grade enriched uranium, says Asculai. “But will they have that information? You can find a lot of cases when intelligence didn’t provide the answer in time.”

Israeli Prime Minister Benjamin Netanyahu blasted the U.S. for not setting hard red lines on Iran’s development of weapons, suggesting that failure to do so is an immoral act that jeopardizes the continued existence of Israel. Halutz condemned the practice of making military policy based on such red lines. He says they are never respected, are overtaken by events and generally make the country that put them in place look foolish. Instead, the U.S. and Israel should sit down together and agree on the facts, and make decisions about what to do. They also must promote a relevant coalition and assemble an international force that includes China, Russia, India, Brazil and others, he adds.

There are circumstances that could change the march toward a conflict with Iran over its nuclear weapons program, says Halutz. These include the fall of the Syrian regime, Iran’s major supporter; and decisions by Russia and China to not transfer advanced military technologies into the region.


U.S. scales back Afghanistan peace plan


The New York Times

Originally published Monday, October 1, 2012 at 8:32 PM

KABUL, Afghanistan — With the surge of U.S. troops over and the Taliban still a potent threat, U.S. generals and civilian officials acknowledge that they have all but written off what was once one of the cornerstones of their strategy to end the war here: battering the Taliban into a peace deal.

The once ambitious U.S. plans for ending the war are now being replaced by the far more modest goal of setting the stage for the Afghans to work out a deal among themselves in the years after most Western forces depart, and to ensure Pakistan is on board with any eventual settlement.

Military and diplomatic officials here and in Washington said that despite attempts to engage directly with Taliban leaders this year, they now expect that any significant progress will come only after 2014, once the bulk of NATO troops have left.

“I don’t see it happening in the next couple years,” said a senior coalition officer. “It’s a very resilient enemy and I’m not going to tell you it’s not. It will be a constant battle and it will be for years.”

The failure to broker meaningful talks with the Taliban underscores the fragility of the gains claimed during the surge of U.S. troops ordered by President Obama in 2009. The 30,000 extra troops won back territory held by the Taliban, but by nearly all estimates failed to deal a crippling blow.

Critics of the Obama administration say the U.S. also weakened its own hand by agreeing to the 2014 deadline for its own involvement in combat operations, voluntarily ceding the prize the Taliban have been seeking for over a decade.

The Obama administration defends the deadline as crucial to persuading the Afghan government and military to assume full responsibility for the country, and politically necessary for Americans weary of what has already become the country’s longest war.

Among U.S. commanding generals here, from Stanley McChrystal and David Petraeus to today’s John Allen, it has been an oft-repeated mantra that the U.S. is

not going to kill its way out of Afghanistan. They said that the Afghanistan war, like most insurgencies, could only end with a negotiation.

Now U.S. officials say they have reduced their goals further — to patiently laying the groundwork for eventual peace talks after they leave. U.S. officials say

they hope the Taliban will find the Afghan army a more formidable adversary than they expect and be compelled, in the years after NATO withdraws, to come

to terms with what they now dismiss as a “puppet” government.

The U.S. has not given up on talks before that time. It agreed last month to set up a committee with Pakistan that would vet potential new Taliban

interlocutors, and the Obama administration is considering whether to revive a proposed prisoner swap with the insurgents that would, officials hope, reopen

preliminary discussions that collapsed in March, current and former U.S. officials said.

With the end of this year’s fighting season, the Taliban have weathered the biggest push the U.S.-led coalition is going to make against them. A third of all U.S.

forces left by this month, and more of the 68,000 remaining may leave next year, with the goal that only a residual force of trainers and special operations

troops will remain by the end of 2014.

Bringing Pakistan into the search for Taliban contacts is also an uncertain strategy, U.S. officials said. The details of the new vetting committee have yet to be

worked out, and “if we are depending on Pakistan, it comes with an asterisk,” one of the officials said. “We never know whether they will see it through.”

The U.S. shift toward a more peripheral role in peace efforts represents another retreat fromWashington’s once broad designs for Afghanistan, where the

surge, plus a sharp escalation of nighttime raids by special-operations forces against Taliban field commanders, were partly aimed at forcing the Taliban into

negotiations, making a Western withdrawal more feasible.

For a brief moment, the strategy appeared to be working: Preliminary talks, painstakingly set up throughout 2011, opened early this year in Qatar.

The effort fell apart when the Obama administration, faced with bipartisan opposition in Washington, could not make good on a proposed prisoner swap, in

which five Taliban leaders held at Guantánamo Bay, Cuba, would have been exchanged for the sole U.S. soldier held by the insurgents, Sgt. Bowe Bergdahl.

The trade was to be an initial confidence-building measure that would lead to more serious talks. If it is revived by the Obama administration, it would come

after the presidential election, most likely leaving too little time to reach a deal before 2014, some current and former U.S. officials said.


Congress keeping mum on defense merger

The Hill

By Jeremy Herb     – 10/02/12 08:13 PM ET


U.S. officials have been keeping quiet in the weeks since news broke of a potential $45 billion merger between BAE Systems and EADS that would create the world’s largest defense and aerospace company.

It’s a stark contrast from government officials in France, Germany and the United Kingdom, which have been engaged in a public debate about the merger as the companies hash out the details ahead of an Oct. 10 British takeover deadline.

While much of the action between the two European companies is happening on the other side of the Atlantic, the talks are occurring with a keen eye cast toward the United States and its defense market.

U.S. officials at the Justice Department and Pentagon will have to sign off on the merger, and Congress will have an opportunity to weigh in as well.

BAE, which has the larger presence in the U.S., is already gearing up for outreach in Washington. The company has hired lobbyists from two big D.C. firms and held meetings with DOD officials and congressional offices.

Little has been said publicly about the deal on Capitol Hill. The chairmen and ranking members of the four main defense committees declined requests from The Hill to discuss the merger. Some said they were waiting for more details.

“The chairman is watching the potential merger with interest,” Claude Chafin, a spokesman for House Armed Services Committee Chairman Buck McKeon (R-Calif.), said in an email. “His expectation is that the merger and well-established process that reviews the implications to national security will follow regular order.”


While the merger is between two European companies that don’t overlap much, the deal has the potential to shake up the U.S. defense and aerospace markets, representing the first step in what some have warned is a new round of consolidation for the industry.

There are numerous issues facing the merger in the United States, but the most immediate one is BAE’s special security arrangement (SSA) with the U.S. government, which gives the company access to sensitive DOD contracts by fencing off BAE’s North American entity from its U.K. parent.

BAE’s agreement gives it access to projects that other European contractors, including EADS, do not have.

France has a direct stake in EADS, and Germany has an indirect stake. German officials have talked about acquiring a direct share, but there are concerns about the level of operational control European governments would have in the merged company, even if the North American branch were fenced off.

One defense industry insider said that if BAE’s security arrangement were weakened, it would force the company to call off the deal.

“I don’t think they would do the merger if that was the case,” the official said. “The SSA is so important for them to have.”

Loren Thompson, a defense analyst at the Lexington Institute who advises both BAE and some of its competitors, predicted that industry competitors would try to leverage security concerns to sabotage the deal.

“It is a fairly easy thing to create a structure in the new enterprise that prevents the leakage of any sensitive information, but critics of the deal will claim otherwise,” Thompson said.

Boeing, which competes with EADS subsidiary Airbus in the commercial aviation market, is seen as the competitor with the most at stake. Boeing’s chief defense official said last month that the merger needed to be “scrutinized” for national-security and industrial questions.

“The reason Boeing is concerned is that it doesn’t want its biggest competitor to have a major political presence in its home market,” Thompson said.

Industry officials said Congress might make the most noise about potential job losses. While the merger might not cause direct layoffs in the United States, the officials said, a combined BAE-EADS would be better positioned to compete around the globe against defense giants Lockheed Martin and Boeing.

Companies like Lockheed Martin have said they want to increase foreign sales to help continue their growth amid a declining U.S. defense market.

The EADS-BAE merger talks have also pointed up fresh questions about whether a new wave of consolidation is coming to the defense industry, which hasn’t happened since the 1990s.

“I think it does signal the start of something,” said Mackenzie Eaglen, a defense analyst at the American Enterprise Institute. “A lot of analysts have assumed there’s pent-up M&A demand in the U.S. defense sector.”

Russell Solomon, a senior vice president at Moody’s, wrote last month that if the EADS-BAE merger does not occur, other companies might try to acquire BAE instead.

“We expect that the merger talks have now triggered at least consideration of a new round of business realignments within the global aerospace and defense industry, the immediate effects of which could include counteroffers for BAE from other large defense contractors, further consolidation among remaining defense contractors, asset trades among industry participants or, if the transaction moves forward, regulatory-mandated asset dispositions,” Solomon wrote.


Of course, the U.S. role in the merger will be moot if the French, German and British governments don’t sign off on it. Their decision remains up in the air as European officials debate the ratio of ownership for BAE and EADS in the combined company and the role that the governments will play.

Thompson said he expects more talk in the U.S. about the deal after Election Day.

“The U.S. political system is totally distracted by the election,” Thompson said. “I don’t expect anybody in Congress to say anything until after Nov. 6.”


Cable companies cap data use for revenue


Home Internet service providers are introducing “usage-based pricing plans” that would replace all-you-can eat packages and place a limit on monthly data usage.

7:13PM EST October 1. 2012


With Comcast starting a new trial in her area on Oct. 1, Tawnie Knight had to choose from a new lineup of its service plans that places a firm limit on the amount of data she consumes each month — and charges she’ll incur if she goes over.

The Tucson-based computer technician, whose daughter loves online video games, estimates her family uses about 350 gigabytes of data a month (a 2-hour high-definition movie can eat up 3 GB to 5 GB). “We stream a lot. I don’t want to get into a situation where I have to pay $10 here and there and get nickeled-and-dimed to death,” she says.

Knight is one of hundreds of thousands of customers in the Tucson region who are part of Comcast’s trial of “usage-based pricing plans” that replace all-you-can-use data plans with ones that cap the amount of data a customer can download.

Wireless carriers’ quick adoption of capped Internet plans has generated big headlines recently. But the practice of limiting data — and charging customers according to use — is gaining just as much traction on the wired side. Cablevision is one of the few large cable Internet providers in the U.S. that doesn’t impose a data cap.

While Knight sees such plans as a financial headache to be endured each month, Internet providers are quietly relying on them as new revenue sources needed at a time when their TV and phone businesses are sagging.

The average household worldwide used 26.2 GB of data per month in 2011, according to a study by Cisco Systems. By 2016, more than 84 GB a month will be consumed by an average family, it predicts.

Several providers, including AT&T and Time Warner Cable, have tried to cap broadband use in the past, only to quickly retreat from their efforts following consumer backlash. But wireless carriers have aggressively introduced capped data plans and cable companies are emboldened by the changes, says Charles Golvin, an analyst at Forrester Research.

“They’re looking to increase revenue. They don’t face a whole lot of rosy prospects,” he says. “The wireless industry is setting the pace on what the model will look like.”


The metered plans, cable operators say, are a more fair way to price data services, because heavy users will pay more. Broadband demand is skyrocketing, and additional revenue will help cable companies invest in the future, they say.

“In the wired world, there is a better path to add capacity, but it’s not free,” says Michael Powell, CEO of the National Cable & Telecommunications Association, a trade group of cable providers. “It’s very expensive.” The capped plan “ensures the capital that’s necessary to make (the networks) better.”

But opponents of capped plans contend that they are a product of a price discrimination strategy and charge that they have been rolled out too quickly without clear communication to customers.


Some recent changes include:

— Data limits in tiers. In May, Comcast, the nation’s largest cable company, said it would launch its trial in two markets — Tucson and Nashville — that offer six pricing tiers based on download speeds and data limits.

Its cheapest plan, at about $40, will carry a 300 GB limit, while the most expensive plan, about $200, comes with 600 GB. Anyone who exceeds the limit on any plan can pay $10 for each additional data bucket of 50 GB. Those who reach 90% of their limit will get an e-mail alert asking them to pay for additional data allotments or consider upgrading.

In other markets, Comcast currently offers similar pricing tiers that vary by download speeds and have a soft, mostly unenforced, cap of 300 GB.

— Paying overage in increments. Time Warner Cable launched a trial in Texas in February with a monthly data limit of 5 GB on its three lower-speed tiers that cost $35 to $55.

Customers who choose the option receive a $5 discount. Those who go over the cap pay $1 for each additional gigabyte up to a maximum of $25.

The trial was expanded to North Carolina and South Carolina in August, and the company plans to expand it nationally. “It’s targeted to those who don’t use the Internet a lot and are looking to save money during these times,” says spokesman Justin Venech.

Cable One, which operates in 19 states, charges 50 cents for each additional gigabyte.

— Simple data caps. Several companies, including Cox Communications, Charter Communications, CenturyLink and Mediacom, have monthly caps that are minimally enforced — at least for now.

“We don’t currently charge overage,” says Todd Smith, a spokesman for Cox, which has several price tiers based on download speeds and data limits that were introduced in 2010. Its data limits range from 30 GB to 400 GB per month.

CenturyLink’s spokesman Mark Molzen says subscribers who exceed its limit – ranging from 150 GB to 250 GB – are rare, and the company would only cancel the accounts of heavy users if they ignore three requests to curb their use or fail to upgrade to “an unlimited business-class line,” says spokesman Mark Molzen.

Partly because data caps are often unenforced and the terms are spelled out in fine-print documents few bother to read, the limits go unnoticed by many customers. Tom An, a restaurant owner in Vienna, Va., says he only recently discovered that his Cox Internet account has a limit of 250 GB. “It came as a big surprise to me,” he says. “I don’t think they did a good job in letting me know that. I’m not that concerned now. But down the line, with more HD videos coming, it could be a problem.”


Seeking clarification


That many consumers aren’t aware of their data caps underscores the industry’s generosity, industry executives say. Comcast says its median customer use per month is about 8 GB to 10 GB nationwide. “The reality is, a vast majority of consumers don’t go anywhere near these (limits),” he says.

While that may be true today, it’s inevitable that more customers will reach the limit in coming years, counters Golvin of Forrester Research. “There’s nothing unique about bandwidth that says there’s a natural limit,” he says.

Some critics also are demanding clearer explanation from cable providers on the urgency for new plans. Internet providers have failed to clarify how the caps are set, tiers are created and pricing is determined, says Gigi Sohn, CEO of technology consumer advocacy firm Public Knowledge. “We know nothing about how caps are set or what purpose the cap is supposed to achieve. When they’re challenged on it, the cable industry runs away from it,” she says.

The new plans are designed mainly to penalize heavy users, since network congestion has not been a pressing issue, she says. “It charges people who value the Internet more,” she says. “It’s either a price-gouging or price-discrimination strategy.”

Not surprisingly, the industry doesn’t quite see it that way. While conceding that new pricing plans are “not purely a congestion issue,” Powell says that requiring excessive users to pay more will also help modify their data consumption. “If there’s a price to your consumption, you’ll govern your consumption,” he says. “It’s a 1% problem.”


‘Going to be a mess’

After setting up a new account at Comcast, Knight predicts other customers will want clearer, simpler answers as they’re herded to new plans.

She says Comcast customer service agents she spoke to were confused or unable to answer detailed questions about the new data caps and prices. “I spent almost a whole day trying to figure this out and order the service. This is confusing. And I know technology fairly well. For the average consumer, this is going be a mess,” she says.

Charlie Douglas, a Comcast spokesman, emphasizes that the Tucson trial is new and says its “customer agents are being trained.”

In the end, Knight chose a plan that comes with a 450 GB limit, an overwhelming sum for most but not for her bandwidth-loving family. Beyond her daughter’s video game habits, Knight also uses TV network apps daily to catch up on shows she misses after work.

Her previous Comcast Internet account, which costs her about $70 a month, came with a soft, unenforced monthly limit without overage charges. The new Internet access is priced at about $115, before cable TV, she says.

“My bill just shot up, and I’m still concerned about going over the limit,” she says. “I’m already watching my wireless limits. I don’t want to have to watch my cable Internet limit, too.”



Winter Forecast: Not Mild, But Wild for Eastern U.S.



By Meghan Evans, Meteorologist

October 03, 2012; 9:12 AM


Every year, issues a U.S. winter forecast, highlighting predictions of temperature and precipitation trends. Last year, winter was unusually warm for much of the eastern two-thirds of the nation.

Big snow events may return to a portion of the I-95 corridor of the Northeast and mid-Atlantic as well as the central and southern Appalachians this winter, while wet weather is predicted for the Gulf Coast and Southeast.

Parts of the Midwest could fall short of normal snowfall again this year with the main storm track to the south.

Farther west, dry conditions are forecast to persist in the Northwest, leading to growing drought concerns.


A breakdown of the Winter 2012-2013 forecast can be found below.


Above-Normal Snow for Northeast, Appalachians

Above-normal snowfall is predicted for the Northeast, mid-Atlantic and central and southern Appalachians, spanning western Massachusetts to northern portions of Georgia and Alabama, this winter.

“I-95 this year in the Northeast and mid-Atlantic will have more snow than they did last year. However, as far as above-normal snowfall goes, from New York City on south and west has a better shot with more mixed rain and snow systems in New England,” AccuWeather Lead Long-Range Forecaster Paul Pastelok said.


Philadelphia, Washington, D.C., Baltimore and Charlotte are among other cities that may receive more snow than usual.

A couple of larger storms could unleash the above-normal snowfall in the major cities, as the winter setup should allow big storms to form off the East Coast. The best chance for the big snowstorms will arrive during the middle to latter part of the season, including January and February.

Temperatures may start out slightly above to near normal, but as the season progresses and some snow accumulates, it will turn colder than normal during February.

While the coldest air is expected to bypass New England, bringing more mixed rain and snow events, Boston and Portland may get near-normal snow amounts this winter. Back to Top


Wet, Severe Threat for Gulf Coast, Southeast

With a frequent storm track anticipated across the South, it will be a wet winter for portions of the Gulf Coast and the Southeast.

“Above-normal precipitation, rainfall, for the South, you got to watch out in South Texas, places like San Antonio and Brownsville that could get into the act once in a while. But I’m more concerned as you get farther east along the north-central Gulf Coast states. Tallahassee, maybe Atlanta, getting into that mix as well,” Pastelok explained.

Rain may hold temperatures down for the season with departures of 1-2 degrees below normal. Besides rainy weather and cooler air, the threat for episodes of severe storms will also exist.

“Severe weather is going to be a problem again this winter season. Last year, it was the second half of the winter season and more widespread. I think this year it’s going to be early on, late November and December, and more confined to the north-central Gulf Coast states, northern Florida and parts of the Southeast,” Pastelok added.

Potent storms formed by the clashing of cooler air to the north and milder air farther south will act as the trigger for the severe weather, which could produce tornadoes, high winds and flash flooding.

While it will remain fairly mild for the most part in central and southern portions of Florida, cold air may drill into the citrus crop areas at times behind big storms.

“There will be threats of frost with temperatures in the 30s in the citrus growing areas this year; however, the odds of a damaging freeze are much lower,” AccuWeather Expert Senior Meteorologist Dale Mohler said. “The window for frost is usually from late December through early February.” A strong freeze that can damage citrus would require temperatures to drop to 28 degrees or lower for more than two hours. Back to Top


Below-Normal Snow for Midwest; Normal Lake-Effect Snow for Great Lakes

Following a dry and mild winter last year, portions of the Midwest is forecast to receive below-normal snowfall this winter.

“Across the Upper Midwest, cities like Chicago, Minneapolis, I think, are going to miss out on the big systems down to the south as far as snowfall goes. I think they are going to have to rely on more clipper systems coming down out of the north and west,” Pastelok said.

Omaha, Green Bay and St. Louis are other cities that may get less snow than normal.




Clipper systems are quick-moving systems that drop down from Alberta, Canada. They often have very little moisture associated with them, so they are not big snow producers.

The lower-than-normal snowfall in the Northern Plains and Upper Midwest will result in spotty snow cover which in turn will help to keep temperatures milder than normal, according to AccuWeather Expert Senior Meteorologist Jack Boston. However, temperature departures are not expected to be as extreme as last winter.

Meanwhile, near-normal snow is predicted for the typical Great Lakes snow belts. The warmer-than-normal water of the Great Lakes will set the stage for the lake-effect snow machine to turn on as any cold waves arrive. Back to Top


Growing Drought Concerns in the Northwest

There are growing concerns of building drought conditions in the Northwest as dry weather is expected to continue straight through the winter season.

“I have big concerns about the Northwest as far as drought goes,” Pastelok emphasized. “We have already set up the stage here at the start of fall with wildfires and drought conditions. With the exception of a break with some rain and snow during October and early November, it will be drier than normal through the winter season and maybe even longer as we head toward spring.”

As smoke rises behind, firefighter Jose Barajas hefts his pack as he gets his equipment ready Wednesday, Aug. 15, 2012, near Cle Elum, Wash. The fire burning near Cle Elum burned dozens of homes and caused hundreds of people to be evacuated. (AP Photo/Elaine Thompson)

This winter, the storm track is forecast to be well to the south in the West, most likely into Southern California, while drier air spreads from western Canada into the Northwest.

According to the U.S. Drought Monitor, moderate and severe drought conditions are already gripping much of Montana, portions of Idaho, Wyoming, Utah, Nevada and Oregon. Spokane, Wash., Pendleton, Ore., and Boise, Idaho, have all received 10 percent or less of the normal August and September rainfall.

Numerous wildfires have been fueled by dry vegetation in the Northwest, including massive blazes such as the Wenatchee Complex and Barker Canyon Complex burning in Washington state, the Mustang and Kinyon Road fires in Idaho and the Long Draw and Holloway fires in Oregon.

The fire season may be extended due to the worsening drought conditions.


Some Drought Relief for the Southern Plains, Texas

While drought conditions may deepen in the Northwest, some beneficial rain is predicted for the drought-stricken southern Plains and western Texas this winter.

The U.S. Drought Monitor reports that extreme to exceptional drought conditions are gripping Nebraska, Kansas, Oklahoma, eastern Colorado and western Texas.

“As far as relief from the drought, parts of the southern Plains and West Texas, especially, I think most of the systems early on hit the Southwest and fall apart coming into the east. Later into the winter season, I think we could start to pick up some rainfall, especially in West Texas, and that could lead into the spring season as well,” Pastelok said.


The brunt of needed rain is forecast for the latter part of the winter season, especially during February.


Snowy Early, Cold in the Rockies

An active start to winter is expected in the central and southern Rockies with above-normal snowfall forecast for much of the region.

“We do expect above-normal snowfall for places like Albuquerque and just south of Salt Lake City. Denver will probably be near normal,” Pastelok added.

By the middle to latter part of the season, the active storm track and thus snowstorms should ease. However, a secondary peak in snow is normal for the Rockies late in the winter into the spring, so the region will not be entirely free of snow through late February and March.

With significant snowpack established this winter, temperatures will be held below normal.


Some Wet, Snowy Weather for Southern California

Following a major snow drought in California last year, some good news is in store both for the water supply and for skiers in the Golden State.

“Rain and [mountain] snow in California this coming season, I believe, will be near normal for the most part. A little bit more in the southern half than the northern half is expected,” Pastelok said.

A moist flow of air from the subtropical jet stream will supply the fuel for winter storms.


Cyberattack Could Leave States in the Dark

A cyberattack could leave whole regions with no Internet, phone service or electricity. State cybersecurity officers must plan for the unthinkable.


Over two steamy days in August 2003, New York City’s crippled power grid paralyzed the Big Apple and invoked chilling reminders of the Sept. 11 terrorist attacks two years earlier. Elevators froze in skyscrapers, hotel guests with inactive key cards were locked from rooms, and commuters were forced to abandon the subway and resort to walking, hitchhiking and cajoling rides in gridlocked streets. Flights were canceled and even bus service was interrupted. The neon lights of Times Square went dim as the Brooklyn Bridge transformed into a slow-moving expressway for weary pedestrians.

The outage was part of a much larger blackout that impacted an estimated 50 million people in Canada and eight states across the Eastern seaboard and Midwest. The cause was later determined to be overloaded transmission lines compounded by human error — and not a rogue band of hacktivists or shadowy cyberterrorists. But the incident underscored a key vulnerability that makes the nation’s power grid a marquee target for cyberintruders bent on exploiting existing weaknesses: its reliance on IT systems and networks. The 2003 blackout could happen again, experts say. Only this time, a cyberattack would be responsible for crippling the nation’s infrastructure and leaving states, cities and whole regions in the dark with no Internet, phone service or electricity. Even worse, financial institutions, water supplies and public transit could be attacked since all are penetrable via the Internet.

The specter of an electronic assault on New York’s power supply is so worrisome that the White House conducted a private simulation in March for U.S. senators that mimicked the 2003 blackout in an effort to highlight vulnerabilities and muster support for the passage of comprehensive cybersecurity legislation (the bill stalled in the Senate in August). Homeland Security Secretary Janet Napolitano, FBI Director Robert Mueller and White House counterterrorism adviser John Brennan were among the participants.

While the focus on physical threats is an emerging cyberterror issue, state and local computer networks have long been high-value targets. “State governments have the most comprehensive information about citizens, from birth all the way to death,” says Srini Subramanian, principal with Deloitte & Touche and leader of the firm’s state cybersecurity initiative. Over the last 15 years, states have migrated much of that information online, a move that offers convenience but adds risk, notes Subramanian, co-author of a 2010 study with the National Association of State Chief Information Officers (NASCIO) on cyberpreparedness.

As Internet-based perils grow in sophistication and frequency, critics complain that Congress and the Obama administration are not providing sufficient leadership and resources to states and localities. “Federal regulations and guidance around this are disharmonized,” says Doug Robinson, executive director of NASCIO, noting that each federal agency issues unique requirements detailing the handling of its data, making compliance tedious for states. He adds: “No one in the federal government is saying, ‘We ought to get together and coordinate all this so we’re not inflicting so much pain on the states that are executing our federal programs.'” Robinson and other state advocates say they welcome assistance and guidance from Washington that doesn’t come with strings, like unfunded mandates and preemption of state laws.

States are now racing to fill the perceived regulatory void. Forty-six states have enacted data protection laws designed to safeguard personal information. According to NASCIO, 41 states have adopted or expect to adopt strategic plans designed to better coordinate Internet security efforts. Among them is Michigan, which adopted its plan last October — during National Cybersecurity Awareness Month — with strong backing from Gov. Rick Snyder, who formerly served as president, chairman and interim CEO of Gateway computers. Snyder treats cyberprotection as a top priority and “economic development opportunity,” says Dan Lohrmann, the state’s first chief security officer. Under the initiative, Michigan is poised to launch the first state-level “cyber-range” to train its employees in next-generation defensive technologies.

For state executives tasked with thwarting electronic intrusions, the obstacles are daunting. “States are constantly running to catch up to the nature of the threats,” Robinson says. Each day, state networks face electronic assaults that can number in the tens of thousands, even millions. Breach attempts take the form of malware, viruses, denial-of-service attacks and network probes searching for weak links such as easy-to-guess passwords. Perpetrators run the gamut from corrupt employees, crime syndicates and activists to rogue nations and terrorists. They use technology to cloak identities and whereabouts, and if based overseas, are potentially beyond the reach of U.S. law enforcement.

Increased reliance on third-party contractors and vendors expose states to new dangers if partners are not fully compliant with security protocols. The ubiquity of ever-changing personal technology, from smartphones to tablets to laptops, makes it difficult to plug all security holes. Regular training, monitoring and vigilance are required to keep pace with hackers. State security officers can’t just worry about data theft. They must plan for the unthinkable: so-called blended attacks that combine conventional warfare or terrorism with coordinated cyberintrusions, and are potentially lethal. And there’s the challenge of raising and maintaining awareness about largely invisible threats that crisscross borders and datelines.

While some states have bolstered security to match the most stringent federal safeguards, others lag due to funding shortfalls and scarce resources. A 2010 NASCIO study found that states only devote 1 to 3 percent of IT budgets to cyberprotection. Data gathered for a 2012 update indicates that those figures slipped to 1 to 2 percent of IT budgets, which mostly stayed flat. “That means it’s probably half or less than what it should be because the states have been under fiscal crisis,” says Robinson. As a result, Deloitte’s Subramanian says, attacks on state governments and agencies are mounting. Two breaches in April that each involved the theft of hundreds of thousands of personal records highlight the trend. Hackers who remain at large infiltrated a Utah server via a state contractor to steal Medicaid records, Social Security numbers and other sensitive information, while in South Carolina, a state employee was arrested for accessing personal information from Medicaid beneficiaries.

For cash-strapped states, mustering the necessary funds for cybersecurity is a challenge when streets and bridges need repair. Cybersecurity programs also become sidelined when states don’t shelter them from political squabbles. In June, a dispute between Florida’s governor and Legislature resulted in the elimination of the state CIO position. “There are different levels of maturity” to state readiness, says Mark Weatherford, deputy undersecretary for cybersecurity at the Department of Homeland Security (DHS) and former chief security officer for California and Colorado. “Does it concern me? Of course it concerns me.” To address the imbalance, he and his team regularly urge governors to elevate cybersecurity as a top priority.

But Weatherford acknowledges that there’s room for improvement at the federal level as well. “We can always do more. There’s not enough money, resources or time to do everything we want to do,” he says. Citing the extensive outreach that his department conducts with governors, security officials and other stakeholders, though, he insists his department is doing all it can to help states. “States are sovereign organizations, and most of them don’t like a lot of oversight by the federal government,” he says.

Weatherford says that federal agencies do, in fact, comply with uniform cybersecurity standards, but acknowledges that each agency issues its own security and privacy requirements. That’s necessary, he says, because agency needs vary widely depending on the sensitivity of their information. “We try to be as consistent as we possibly can in how we work with each of the states,” Weatherford says. Regarding funding, he notes that DHS provides grant money to the Multi-State Information Sharing and Analysis Center, a nonprofit, private-sector group that conducts cybertraining and outreach. Additional federal money that states can devote to cybersecurity is available through FEMA’s homeland security grants program. “If I had more money that I could provide, I would love to be able to do that,” he says. “We in the government are in a resource-constrained environment.”

As states assert their authority, they enter muddy regulatory waters complicated not just by federal mandates, but also international laws and treaties. “Virtually everything is murky in this area and there are very few clear answers,” says Michael Glennon, professor of international law at Tufts University’s Fletcher School and author of a detailed legal analysis of state cyberlaw. States run an ongoing risk of federal preemption. “It’s always within the authority of the Congress to enact preempting legislation,” and “hard to conceive of any area involving cyberoperations that would be seen by the courts to constitute a realm of exclusive state authority,” he says. For now, states have broad jurisdiction because there’s little the federal government has done that could be viewed as preemptive. Still, Glennon says, “That could always change.”

California’s sweeping data protection law, which took effect in 2004, requires companies to bar unauthorized access to the personal information of its residents. “California really took the lead when it comes to data protection and concerns about corporations negligently misplacing or failing to protect sensitive data that they have on file,” Glennon says. “Other states have looked to California as the model for data protection.”

The hodgepodge of state laws and the Internet’s global structure have given rise to legal quirks. A similar Massachusetts law that took effect in 2010 applies to residents wherever they travel, and to stores in other countries that retain the credit card data of Massachusetts residents — even when purchases are made online. If a Paris hotel keeps computer files on dozens of vacationers from different states, it might be forced to comply with numerous U.S. data protection plans, Glennon says. “Unless all these plans get harmonized through preemptive federal legislation, some entities are going to confront a disincentive for dealing with Americans,” he warns.

With the collapse of federal cybersecurity legislation, lawmakers are sparring over the direction of a fresh legislative push and whether President Obama should issue an executive order to create a new program to protect critical infrastructure. In the meantime, state security officers are left to wonder each day if they’ve done enough to safeguard their networks against the sort of catastrophic breach — like the 2003 blackout — that’s guaranteed to stir Washington into action.


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