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December 1 2012

December 3, 2012




Sequestration Or Not, U.S. Firms, DoD Will Take a Hit

Defense News

Nov. 18, 2012 – 11:52AM |


Even if the U.S. Congress is able to hammer out a debt deal that avoids sequestration in January, the resulting agreement will likely result in billions of dollars in additional cuts to the Defense Department — perhaps as much as $25 billion — likely forcing the military to alter its roles and missions.

Internally, some of the nation’s largest defense companies are also planning for a possible $25 billion cut annually from current spending levels. That $25 billion is half of what DoD is expected to absorb annually under sequestration. This month, Boeing announced a major reduction among its executive ranks as it prepares for a decline in U.S. defense spending.

“If they come up with a deal to avert sequestration, I think the defense portion of that deal will be cuts [at] about half the level that sequestration would require,” said Todd Harrison, an analyst with the Center for Strategic and Budgetary Assessments.
But the cuts, under a debt deal, would likely be distributed differently than under sequestration.

“Instead of an even $25 billion across every year for the next 10 years, it could be more back-loaded and it certainly would give DoD the flexibility to target those cuts, to allocate them in a thoughtful, strategic manner,” Harrison said.

As lawmakers and the White House attempt to craft a debt reduction deal to avert sequestration, new voices are offering suggestions for ways to include defense cuts as part of the governmentwide package. Experts argue that some of these plans, by simply trimming more fat, significantly reduce DoD spending without harming readiness.

Others say Pentagon leaders have to make real choices when it comes to which weapon systems and troop levels to fund.

Without a debt reduction deal, the Pentagon would get hit with an immediate 10 percent cut to its spending accounts in fiscal 2013, which totals about $50 billion beginning Jan. 2.

The consensus in Washington is that cuts under sequestration are not likely, although some experts believe they might temporarily go into effect until the newly elected Congress is seated and able to iron out a debt deal.

The only parts of the Pentagon budget not subject to sequestration are funding for war operations in Afghanistan, for which the Pentagon requested $88.5 billion in fiscal 2013, and all personnel accounts. DoD is contemplating a roughly $64 billion Afghanistan operations request in 2014, sources said, the same year major combat in the country is expected to end.


Another New Military Strategy

DoD unveiled a new military strategy in January, designed with $487 billion in cuts to defense spending already taken into account as a result of the Budget Control Act. Top DoD leaders often have said further spending cuts — through sequestration or other measures — would force them to rethink that strategy.

Now, with additional cuts looming, think tanks are chiming in with ways to further tailor defense spending.

Last week, the Stimson Center think tank in Washington released a report presenting a new military strategy for DoD that could be tailored to various levels of spending.

The Project on Defense Alternatives also put together a defense plan, which calls for cutting military end strength by 19 percent. It also called for cutting large swaths of military equipment.

Along with the strategy, the Stimson-organized group — which includes a handful of retired generals and admirals — also looked at ways to make DoD more efficient without cutting end strength and major weapons programs. The panel examined a vast number of official studies and expert recommendations and concluded DoD could save about $1 trillion over the next decade if it instituted “better manpower utilization” measures and compensation system and acquisition reforms.

While the group recognized that DoD achieving the entire $1 trillion in savings is highly unlikely, it looked at what would have to be done to meet sequestration-level cuts if 20 or 40 percent of these efficiency savings were met.

“We used it to illustrate how much less difficult the choices would be if you’re forced to reduce defense spending if you were able to implement these efficiency measures,” said Barry Blechman, co-founder and distinguished fellow at the Stimson Center, on Nov. 14.

The panel also looked at what it calls a “smooth sequester” — phasing in the mandated cuts gradually over several years and not cutting all accounts evenly at 10 percent.

To get to $400 billion in efficiencies, the panel looked at cutting the Army budget by 2 percent per year, reducing brigade combat teams from 45 to between 35 and 40. The Navy could accelerate its retirements of Ticonderoga-class cruisers.

It also looked at a 1 percent cut to the Air Force budget each year and retiring 13 active-duty F-16 fighter squadrons. The report recommends keeping lower-end F-16s in the Air National Guard and placing high-end aircraft, such as F-35 joint strike fighters, in active-duty squadrons.

Lastly, DoD could choose between cutting missile defense spending and reducing nuclear and modernization forces. Even with these cuts, DoD could use money it saves to double its funding of basic applied research and increase special operations forces, cyber warfare capabilities and funding for space systems, the report states.

Assuming the lower level of efficiency savings — $200 billion — DoD would need to make deeper cuts to its force.

It could include cutting the Army budget by 5 percent and the number of brigade combat teams to 30, according to the report.

In the Air Force, the service could choose between active-duty F-16 cuts and reducing F-35 development. For the Navy, it could mean reducing F-35 development. The Marine Corps could cut its budget by 1 percent, reduce end strength by 7 percent and reprioritize its procurement plans.

Lastly, as in the first scenario, DoD could choose between cutting missile defense and reducing nuclear and modernization forces.

But generating efficiencies above the more than $200 billion DoD has already targeted over the next five years — which are separate from the $1 trillion identified by Stimson — is not realistic, Harrison said.

“It’s a noble goal. We should always be trying to get more efficient,” he said. “The reality is it’s hard to do that.”


Since DoD has given up the funds — or re-obligated them — for the already identified efficiencies, it will have to cut from other areas should those levels of saving not materialize.

“I think banking further efficiency savings as part of deficit reduction, it’s really just a way of avoiding the hard choices that you have to make,” Harrision said.

These choices include preserving near-term military readiness at the expense of giving up more force structure or forgoing modernization programs.

“No one wants to cut readiness, but you have to weigh that against the alternatives,” Harrison said. “If you don’t reduce readiness, you are going to be reducing other things, perhaps to a level that’s just not acceptable.”

DoD is facing other choices, including on the size of its ground forces, active duty versus reserves and special operations versus conventional. In aviation, the Air Force must confront its mix of stealth vs. nonstealth aircraft, as well as manned versus unmanned. As for naval, choices are needed between surface and undersea vessels.

“The reality is, you’re not going to be able to choose both,” Harrison said.


FAA delays selection of Miami Valley as possible test site

Dayton Daily News

Posted: 6:08 p.m. Monday, Nov. 19, 2012

By Andrew McGinn

Staff Writer


Citing safety concerns and privacy issues, the Federal Aviation Administration has delayed indefinitely the selection of six U.S. sites for the testing of unmanned aircraft — one of which is hoped to be in the Dayton-Springfield region.

In a letter received late last week by the members of the Unmanned Systems Congressional Caucus, acting FAA Administrator Michael P. Huerta singled out the need to first address privacy concerns that come with increasing the use of drones in the nation’s airspace.

The FAA was to have designated the six sites in December, but already had drawn the ire of the congressional caucus this summer when the agency failed to request site proposals by a July deadline.

“It’s unacceptable in my book that they’re delaying this,” U.S. Rep. Steve Austria, R-Beavercreek said Monday. “The reasons they’re giving us are the reasons they gave us four years ago.”

Winning a test-site designation is seen as key for the region to become a national hub for UAV research, development and manufacturing.

“I’ve spoken to a number of companies who’ve said they would love to build the planes right outside the door of where they could test them,” Austria said.

The frustration, he said, stems largely from the fact that the deadlines being missed by the FAA were of the agency’s own choosing. As it stands, the FAA has yet to ask for site proposals.

“They set their own timelines,” Austria said.

The Washington, D.C.-based Electronic Privacy Information Center has actively petitioned the FAA on drone surveillance concerns.


Ever-evolving UAV technology is designed to be invasive to privacy and is more efficient than manned aircraft because drones fly longer and closer to the earth, said Amie Stepanovich, an EPIC lawyer.

If privacy isn’t protected now, UAV surveillance will rise, she said.

“What drones are capable of today is entirely different even than a year ago,” she said.

Austria said he too wants to make sure unmanned aerial vehicles are safe to fly in manned airspace, which speaks to the need for test sites. The sites will determine if remotely piloted aircraft can safely be integrated into manned airspace by 2015.

As many as 30 sites may compete for six sites, Austria said.

“The purpose of the pilot program was to allow the FAA to supervise six sites in a controlled environment,” he said.

He noted the FAA already is issuing one-year authorizations for the limited flying of UAVs.

While the FAA has cited privacy as an issue, an industry representative said the federal agency’s role is to safely integrate unmanned craft into the skies, not regulate privacy.

But there’s no consensus on how, said Gretchen West, executive vice president of the Association of Unmanned Aerial Vehicle Systems International in Washington, D.C.

“That’s a question a lot of us in the industry have been trying to answer and we don’t have a good answer yet,” she said.

Constitutional protections and legal precedent have provided privacy protections, she added, and have been applied to manned surveillance systems.

“The platform isn’t the issue,” West said. “There’s really no difference between manned and unmanned when you’re talking about privacy.”

While the association understands the FAA’s caution, the UAV community wants site selections to happen quickly.

“The industry obviously would like to see the process move faster because this technology has the potential to create jobs and save lives,” West said.

The Dayton Development Coalition will prepare the state of Ohio’s site bid whenever the FAA asks for proposals.

“We have done our homework and we have not been idle,” said Joseph Zeis, Coalition executive vice president and chief strategic officer. The region will tout Wright-Patterson Air Force Base, the Air Force Research Laboratory, university research and development, the regional aerospace industry, and UAV test areas, he said.

“Our goal is to be ready today or whether it’s six months from today,” he said. “We’re positioning Ohio to support the FAA in the integration of UAVs into the civilian airspace safely and effectively.”

Scott A. Sullivan, president of SelectTech Services Corp., a UAV manufacturer based in Centerville, expects the FAA will ask for site proposals within the next three months.

“… Every month that slips we’re another month behind in terms of what we want to accomplish” for UAV integration, he said. “Any delay inhibits our ability to accelerate that process.”

Sinclair Community College has FAA approval for restricted flying of small UAVs at the Springfield-Beckley Municipal Airport. The Ohio Army National Guard received approval this year as well to train at the Springfield airport with a hand-launched UAV known as a Raven, said Tom Franzen, economic development administrator for the city of Springfield.


The Air Force has FAA approval to fly developmental UAVs at the former DHL air hub in Wilmington.

It’s envisioned that UAVs would use existing facilities at the Springfield airport and the Wilmington Air Park for takeoff, then fly to military airspace in southern Ohio once used by F-16s from the Springfield Air National Guard Base.

Partly in hopes of luring UAV businesses, the city of Springfield is spending up to $267,000 to operate the air traffic control tower for another year at Springfield-Beckley that was rendered virtually obsolete when the Guard’s mission changed to remotely flying Predator drones based overseas.

Springfield also wants to build a new, $2.3 million hangar complex at the airport to attract drone developers. The state would pick up the bulk — $2 million — but the money is still pending, Franzen said.

While use of remotely piloted aircraft is synonymous with the military and CIA, unarmed drones for civilian use are predicted to become a $90 billion global industry in the next 10 years.

Earlier this summer, for example, at its annual Farm Science Review in Madison County, Ohio State University unveiled a hand-launched, 15-pound drone prototype that one day could be used by a farmer to monitor pesticide dispersal in a field and overall plant health.

Franzen said he expected a delay by the FAA in its site-selection process, and that it doesn’t change anything for the city.

Work will continue, he said, to attract new UAV companies and to support the ones already here, like Science Applications International Corp. (SAIC), a Fortune 500 defense contractor that moved UAV research jobs from Virginia to the Nextedge Applied Research and Technology Park east of Springfield.

“No one likes a delay,” Franzen said, “but it doesn’t deter us from our many efforts.”



Tax fight freezes defense industry out of negotiations over ‘fiscal cliff’

The Hill

By Jeremy Herb – 11/20/12 05:30 AM ET


The defense industry has $500 billion in pending Pentagon cuts at stake in the “fiscal cliff” talks, yet it finds itself largely sidelined in the heated debate.

Defense firms desperately want to prevent those cuts, which could cost them contracts and jobs. But in a debate focused on taxes and entitlements, they’re finding themselves on the outside looking in — with great anxiety.

“We’re still hoping, but really it’s coming to the point where it’s out of our hands,” said one senior defense lobbyist.

“Most elected leaders in the House and Senate — on both sides — don’t want this to happen, and the president clearly doesn’t want it … But this is really a debate over taxes and spending,” the lobbyist said.

Industry leaders say they are willing to do their part, and have called for lawmakers to do the same by accepting all options for reducing the deficit, including new tax revenues.


“We’re prepared to be part of the solution, but where we’re probably least capable is weighing in on the tax debate,” said one senior defense industry official. “Most of us in the industry have stayed back and said, ‘That’s not our area of expertise; that’s somebody else’s area of expertise.’ ”

Some defense analysts see the industry’s fiscal-cliff hand weakened by measures taken before the election, when several defense firms threatened to send mass layoff notices to their employees over the threat of the across-the-board cuts. Industry studies forecast losses of more than 1 million jobs if sequestration took effect, and Republicans made those issues a key part of their campaigns in military-heavy states like Virginia.

“I think many people in industry had a strategy of using the election to convince the administration that it couldn’t ignore defense,” said Loren Thompson, a defense analyst with the Lexington Institute and industry consultant. “That’s not the lesson the election seems to be teaching, and now the industry needs to rethink its approach.”

Thompson said that the defense industry wants to have a special status in budget deliberations because of its role in protecting the nation, but that the public doesn’t appear worried by military threats right now, and so ends up sounding like any other interest group in the fiscal-cliff debate.

The Aerospace Industries Association, the defense industry’s largest trade group, told The Hill it’s planning a public campaign during the lame-duck session to ensure lawmakers understand the stakes for the defense industry.

AIA and other defense officials have warned for more than a year that the across-the-board cuts will lead to deep job losses and cause long-term damage to the industrial base.

AIA communications director Dan Stohr acknowledged it’s “a little disturbing” that talks so far have been focused on taxes.

“That’s a big part of the puzzle, but to focus on that to the exclusion of sequestration really doesn’t get to the heart of the issue,” Stohr said. “The major problem that we’ve got is that while we need to cut, we need to do so strategically and thoughtfully — and sequestration is neither.”

Congressional aides argue industry officials and defense-minded lawmakers have been successful in convincing rank-and-file lawmakers that cuts to the Pentagon will not solve the deficit issues.

“I think everyone going into those negotiations understands there’s just not a lot of savings left that’s easily derived from the Pentagon,” said one GOP congressional aide.

“People in the room know you could cut the whole department [of Defense], and you’re still sitting around table trying to figure out the deficit,” the aide said. “They know the solution doesn’t flow through the Pentagon.”

Industry officials emphasize that defense spending is trending downward with the end of the two wars and last year’s Budget Control Act that implemented a 10-year cut of $487 billion to Pentagon spending.

Still, several defense analysts say that if a “grand bargain” is reached, there could easily be further cuts to defense spending in the range of $200 billion to $300 billion over 10 years.

Senate Armed Services Committee Chairman Carl Levin (D-Mich.) suggested earlier this year that an additional $100 billion cut to the Pentagon was achievable.

It’s still possible defense hawks in the House will have a key role in the fiscal-cliff endgame. They might have to convince other conservatives in the House to accept higher taxes in exchange for doing away with defense cuts.

For now, defense officials say the biggest thing they are pushing for in the lame duck — even if they face new cuts — is an end to the uncertainty that’s surrounded the Pentagon budget for more than a year.


“Nearly everything the defense industry touches will be affected, and it would happen just a few weeks from now — and we do not know whether it will,” said Todd Harrison, a defense analyst at the Center for Strategic and Budgetary Assessments.

“The timing here creates a tremendous amount of uncertainty for industry,” Harrison said. “How do you plan for the fact your future sales might be cut 10 percent across all programs?”



Cybersecurity worries spur fears of cost and regulation


A disputed cyber safety bill has been archived for now, but the issue is likely to pop up again next year.


The Kansas City Star

November 26, 2012

The long political fight over the security of the nation’s computer networks is expected to re-ignite next year — with the safety and convenience of virtually every American on the table.

At stake is the nation’s cyberspace, increasingly at risk from playful hackers, thieves, fraudsters, foreign spies and terrorists. Experts insist everything from online gift-buying to transportation systems to the electricity in your home is endangered.

They paint frightening pictures of derailed trains and toxic clouds, closed airports and hospitals, even compromised nuclear power plants fouled by secret attacks on computer networks.

“It’s not hyperbole,” said Ken Silva, senior vice president for cybersecurity at ManTech International, a technology and national security firm. “Cybersecurity needs to be a national priority.”

The time is past, analysts say, for thinking of the dangers as so much science fiction.

“It’s not if it’s going to happen,” said Jeff Lanza, a former FBI spokesman who now lectures on cybersecurity. “It’s when.”

But an unlikely coalition of businesses and civil libertarians has pushed back, arguing potential government-ordered fixes would complicate computer use, stifle innovation, and cost consumers millions.

“The U.S. needs responsive, nimble cybersecurity defenses and policies that will not come from more regulations or government-set standards,” Paul Rosenzweig of the conservative Heritage Foundation wrote in mid-November.

The two arguments collided this month in the Senate — and opponents of the government solution won. For the time being. The Senate finally killed a cyber safety measure, leaving it to the new Congress to revisit the issue next year.

“Our cyber enemies are at the gates,” Connecticut Sen. Joseph Lieberman pleaded before the Nov. 14 vote. “In fact, they have already broken through the gates.”

The statement failed to convince enough of his colleagues. Sen. Roy Blunt, a Missouri Republican, voted against the cybersecurity measure, as did fellow Republicans Kansas Sens. Pat Roberts and Jerry Moran. Democrat Sen. Claire McCaskill voted for it.

Lawmakers said they’ll take another stab at the issue in January.

“This is an issue of national security,” McCaskill said in an email. “We’ve got to tackle these challenges in a commonsense and responsible manner.”

Yet finding cybersecurity agreement in the new Congress won’t be easy.

Possible improvements to securing the computer network are obscure, but some themes have emerged.

Accessing accounts or Web pages could become more difficult as networks impose new screening and verification mechanisms. Using your computer for banking, investing or buying merchandise could become more expensive as companies pass growing cybersecurity expenses on to consumers. Schools might be required to teach cyber safety, while portable phones and tablets might become less intuitive to use.

Computer innovations could slow. Social network participation could dip. Older software might cease to work. Private information might become more available to authorities.

The Senate plan, more than a year in the making, wouldn’t have required any of this. Or precluded it.

Instead, it would have established a National Cybersecurity Council, empowered to assess computer-network-related safety risks and establish semi-voluntary programs and standards for private and public cyber networks. It might have recommended costly system improvements — or easy, cheap fixes that most consumers might never have noticed.

The bill died in part because of the ongoing political stalemate and general mistrust among Republicans and Democrats in Washington.

It also failed because libertarian computer users and businesses convinced lawmakers the measure would give the government enforcement and regulatory tools that could cost billions of dollars without actually improving cyber safety.

“An ineffective program would tie businesses in red tape but would do little to deter bad actors,” the U.S. Chamber of Commerce said in a letter to Congress in November. “Businesses do not have unlimited capital and human talent to devote to regulatory regimes that are … out of date as soon as they are written.”

At the same time the Electronic Frontier Foundation, which lobbies for Internet privacy rights, said the bill was “overly vague” and may have threatened individual Web users.

“We don’t need to water down existing privacy law to address the challenges of cybersecurity,” said EFF attorney Lee Tien in a statement after the vote.

Supporters inserted some privacy protections into the measure this summer, but not enough to save it. Finding a balance among cost-effective, reliable security measures, corporate needs, and privacy rights is difficult, Blunt said.

“How to draw those lines becomes very important,” he said recently.

Cybersecurity compromise is also difficult because of the free-wheeling nature of the Internet, where full agreement on standardizing technical issues is often hard to achieve — and subject to the relentless pace of industry improvements.


The threats vary with targets, experts said, further complicating the search for a universal solution. Some computer-based activities — emails or cat pictures, for example — may be easier to protect than complicated electric grid networks or millions of bank accounts.

For those reasons, and others, grassroots support for cybersecurity legislation next year appears unlikely.

Many Americans, remembering the Y2K threat in 1999, have become jaded to perceived dangers of the interconnected Internet world, complicating the political calculations in Washington.

“Sadly, for everyone to unilaterally agree,” Silva said, “it’s going to take something catastrophic.”

Read more here:


Email not in the Fourth Amendment

Outdated privacy regulations let law enforcement spy via Internet companies and social networks

Houston Chronicle

By Caleb Garling | November 23, 2012 | Updated: November 25, 2012 10:47pm


Outdated digital privacy regulations are increasingly allowing law enforcement agencies to use Internet companies and popular social networks to do their spying.

The Fourth Amendment protects against unreasonable search and seizure of private citizens and their “persons, houses, papers, and effects” – but obviously makes no mention of email in a remote server. In 1986, Congress passed a law regulating how law enforcement can access information stored and communicated electronically. That was years before the Internet became a household term and before email was commonplace.

The law, known as the Electronic Communications Privacy Act, updated the 1968 Federal Wiretap Act. Now, as the Senate considers amending the privacy act to make law enforcement more accountable to the courts, Internet providers and service companies find themselves as awkward middlemen between the government and Web users.

“Rather than ‘Big Brother,’ we have lots of ‘Little Brothers,’ ” said Christopher Calabrese, a privacy lawyer at the American Civil Liberties Union.

While Internet users may think of personal information and photos on services like Gmail, Dropbox, Facebook and Twitter as their own, that information resides within easily accessible computers. In addition, Internet service providers such as AT&T and Verizon hold reams of data pertaining to customers’ Internet Provider addresses, Web histories, locations and personal information.

Critics point out that because of the outdated language in the Electronic Communications Privacy Act, personal information can be accessed with a subpoena from a prosecutor – not through a warrant, which requires the review and blessing of a judge.

The ACLU, the Electronic Frontier Foundation, law professors and judges, and the Digital Due Process organization – a group that spans more than 65 technology companies and political organizations from both sides of the aisle – all agree that the privacy act needs to be updated as soon as possible. Susan Freiwald, a professor of law at the University of San Francisco, points out that one of its biggest failings is not providing legal recourse for citizens.


In cases of eavesdropping, such as a wiretap, the subject has a right to know eventually about the surveillance. But if an investigation digs into people’s email and isn’t brought to trial, she says, the subjects rarely find out that their online activities were being monitored. When law enforcement has an unbridled ability to rifle through private correspondence, “we’re a police state,” Freiwald says.


Leahy proposal

Sen. Patrick Leahy, D-Vt., who has proposed an amendment to the act, said the Senate Judiciary Committee will consider the changes Thursday. The crux of the amendment would require investigators to serve either a warrant to the service provider or a subpoena directly to the user when seeking personal digital information.

The upcoming debate has put some companies in uncomfortable positions as to when they want to respect online privacy and when they don’t. The Association of National Advertisers sent a letter to Microsoft CEO Steve Ballmer professing “profound disappointment” that the default setting for the upcoming version of Internet Explorer would be “do not track.” Tracking users on a Web browser makes targeted advertising for new products easier.

Signers of the letter included representatives of publicly traded giants including IBM, AT&T, Adobe Systems and Intel. Yet all four of those companies, and Microsoft, also are members of the Digital Due Process organization pushing for reform of the privacy act.


Authorities’ concern

Law enforcement groups express concerns about the Leahy measure. The FBI Agents Association and the National Law Enforcement Officers Association wrote separate letters arguing that it would add time and paperwork, and potentially alert suspects to investigations.

“When lives are on the line, when seconds count, law enforcement needs lawful access to electronic communications records without undue delay,” read a letter from an assortment of national and state-level law enforcement groups.

In the first half of 2012, Google says, governments in the United States made 7,969 requests for information on users; With its search engine, email client Gmail, office suite Docs and video-sharing YouTube – to name just a handful of services – the company has a huge window into how people use the Web.

Google, Twitter and others disclose statistics on government information requests voluntarily. Notably, the world’s largest social network, Facebook, says it has no plans to publish data on government requests for information on its users. More than 200 million American and Canadian residents use the social network.

“If the CIA had built Facebook, we’d all be terrified,” points out Wired senior writer Bob McMillan.

In some cases, companies push back on the government. Google did not comply with 10 percent of its information requests in the first half of this year. In September, Twitter asked a New York court to quash a subpoena for personal information on a protester in the Occupy movement.

These fights exist because the law is unclear, says Kurt Opsahl, senior staff attorney at the Electronic Frontier Foundation.


Online boundaries

But online boundaries are not quite as clear as someone’s home. Digital information is usually backed up across servers, or sliced up and distributed across many servers that can reside in different districts or even countries. Also, electronic data is typically intertwined with additional personal information about the subject and other users. Presenting the digital “boundaries” of an investigation would require careful, if not incredibly difficult, explanation – and a judge who understood the technical ramifications.

The Supreme Court has ruled that people have an “expectation of privacy” over the phone and in written letters, requiring a warrant. But the high court has not heard a case regarding the question of e-mail privacy.


Hatching cyberwar: Pentagon incubator will manage weapons


By Dawn Lim


The Pentagon’s research wing is setting up a technology incubator for Defense-funded developers to stitch together computer code to automate offensive cyber operations.

The Arlington, Va.-based experimental lab, called the Collaborative Research Space, will function as the test grounds for Plan X, a four-year funding drive to build a system to “control a cyber battlespace in real-time,” a newly-released contract document on the initiative reveals. The Defense Advanced Research Projects Agency wants onsite developers to build algorithms and combine code that could make it easier for planners to implement more proactive security measures and launch malware campaigns against adversaries. According to the document, DARPA seeks to build “an end-to-end system that enables the military to understand, plan, and manage cyberwarfare in real-time” and an “open platform architecture for integration with government and industry technologies.”

Plan X, also called “foundational cyberwarfare,” signals an increasingly aggressive turn in the Defense Department’s approach to addressing threats to its networks. The laboratory, a designated Collateral Secret area, is described as a collaborative space for contractors and the military. “DARPA intends to arrange program interaction with a variety of users from DoD and other government agencies, including onsite military personnel who will be testing and using the Plan X system on a daily basis,” contract databases indicate.

The public call for proposals, released Nov. 20, marks the Pentagon’s growing willingness to advertise its work on cyber weapons. The initiative comes as the National Cyber Range for Defense personnel to hone computer attack capabilities is slated for a multimillion dollar boost as the system transitions from research laboratories into deployment. President Obama in October signed a secret directive giving the military additional leeway to address computer threats, according to reports.

A request for proposals for Plan X had first been scheduled for release at the end of September but was delayed following an unexpected volume of interest from security researchers and contractors. More than 350 participants attended briefings on the program in October, according to DARPA. The DARPA program is spearheaded by Daniel Roelker, who had started defensive security company Sourcefire as well as DC Black Ops unit at Raytheon SI Government Solutions.

Organizations looking to be funded under Plan X should plan on providing one to two full-time developers with Secret security clearances at the incubator, while supporting the individuals off-site. All code created will be incorporated into a full system located at the space.


While explicitly not funding tools to scan networks, DARPA said in the tender it is looking to fund ways to pool information from such tools to create a map of a network – including security infrastructure such as firewalls and intrusion detection systems – that military strategists can rely on to plan computer-oriented campaigns.

A central tenet of Plan X involves identifying areas for automation and machine assistance in cyber operations. “The speed of planning hinges on using machine assistance to automate as much of the process as possible,” the tender states. With algorithms that can help calculate the resources and tools needed to infiltrate networks, assess possible collateral damage from targeting enemy systems, and capabilities to model opponent moves, DARPA hopes that planners will be able to draw up a plans of action more quickly.

Once a cyberwarfare mission plan can be drawn up for an operation, “the next step is to compile or synthesize the plan into a fully encapsulated executable program or script,” according to the tender. DARPA wants researchers to think about how to build “automated techniques that allow mission planners to graphically construct detailed and robust plans that can be automatically synthesized into an executable mission script.” While automation could speed up the response time of the military, moves to reduce human control could raise concerns, especially if computer glitches go unchecked.

DARPA has explicitly stated it is not funding research into computer vulnerabilities or command and control protocols through Plan X. The broad agency announcement, however, indicates that proposers working on run-time environments — which interpret programming languages and allow them to be executed — “should leverage public and commercial capabilities such as Metasploit, Immunity CANVAS, and other standard toolkits.” These are pentesting and exploit-related tools that identity vulnerabilities in computer systems.



Obama Administration in Talks to Draft Cyber-Security Executive Order


By Brian Prince | Posted 2012-11-27


The White House is reportedly making a major push to get input from various interest groups on the draft of an executive order that would implement some of the provisions written into the Cybersecurity Act of 2012, which fell short of the votes needed to send the legislation to a final vote in the Senate.

According to POLITICO, the Obama administration has been holding meetings with executives from various industries and financial institutions as well as personal privacy advocates in a bid to ensure any new rules are effective and easier to enforce.

“We kicked off a robust sort of outreach, and I would almost frame it as a listening session tour over the past couple months,” said Michael Daniel, cyber-security coordinator at the White House, in an interview with POLITICO.

The Senate voted 51-47 on Nov. 14 to close debate on the Cybersecurity Act. But this was nine votes short of the 60 required to send the legislation to a final vote. It was the second time since August that the act has failed to win sufficient support, which lent urgency to the administration’s efforts to craft an executive order.


A White House spokesperson declined to offer a further update on the progress of the order, which Department of Homeland Security Secretary Janet Napolitano said in September was close to completion. Just what the order would do is a matter of speculation. However, AOL Defense reportedly obtained a draft copy of the executive order that established rules and the levels of authority federal regulatory agencies have for enforcing existing laws and requirements for cyber-security in various sectors.

Talk of an executive order has been slammed by Republicans, who have accused the president of trying to circumvent Congress. Meanwhile, a spokesperson for the U.S. Chamber of Commerce, which condemned the Cybersecurity Act due to concerns it would its requirements would be a burden for business, told Politico that an executive order was “unnecessary.”

“Our focus is on the next steps and the legislation,” said Ann Beauchesne, vice president of the Chamber’s National Security and Emergency Preparedness Department. “We’re not focusing our time on the executive order.”

“Engaging the business community is ideal but (I’m) not sure it is realistic to reach meaningful consensus in time,” said Chris Petersen, CTO and co-founder of security vendor LogRhythm. “We cannot afford to delay critical infrastructure companies’ motivation to invest in better cyber-security capabilities. We need to see more investment in 2013 and companies need the motivation to budget appropriately.”

An executive order would lack the strength of a law, which supporters have said they will continue to seek regardless of whether an order is issued.

“We still need cyberlegislation,” Department of Homeland Security Secretary (DHS) Janet Napolitano told the Senate Committee on Homeland Security and Government Affairs Sept. 19. “This is something Congress should enact in a comprehensive fashion.”

According to Napolitano, an executive order cannot address issues related to liability protections associated with information sharing, increasing criminal penalties against attackers or adding staff at DHS in order to deal with cyber-attacks.

Mark Hatton, CEO of CORE Security, said he would like to see any executive order include a clear definition of what services and sectors are critical to our national security interests, such as power, water and air traffic. There are also need to be defined limits on what is considered critical and what is not.

“If we focus first on the systems we classify as critical and are at risk today, that will be a strong starting position and are more likely to get agreement,” he said, adding that there should also be specific reporting requirements for each of those sectors.

Certainly the voice of the business community must be heard, said Petersen. But the country cannot afford to wait years for all opinions and concerns to be aired, he added.

“We need action now with continued refinement in years to come,” he said.





Pentagon Leaders Testing New Decision-Making Process

Defense News


The top 2 uniformed U.S. military leaders are experimenting with a grading system that will assist them and other senior-level commanders make wide-ranging decisions from funding recommendations to using military force.

This process — instituted by Gen. Martin Dempsey, chairman of the Joint Chiefs of Staff, and Adm. James “Sandy” Winnefeld, the vice chairman — is already assisting Pentagon officials as they develop DoD’s 2014 budget request.

Pentagon officials are currently crafting a 2014 budget request, which will further incorporate elements of a new military strategy DoD unveiled in January.

Dempsey wants to use “national security interests as a sharper decision-driver than just ways and means that are currently in the strategy,” Winnefeld said during a Nov. 27 speech at the Atlantic Council in Washington.

“As this gets tougher, we’re going to have to rely more on a very careful consideration of ends as we look at ways and means,” he said.

In priority order from “most vital to important,” combatant commanders and service chiefs must characterize decisions against a number of national security factors identified in a document called the “Chairman’s Risk Assessment,” which is Dempsey’s assessment of how DoD should implement the U.S. national security strategy.

Winnefeld characterized this approach an “experiment for us in how we might contribute to the decision-making process as the chairman makes his best military advice recommendations.”

Dempsey and Winnefeld are looking at using this process “as a way to help guide us … in the recommendations that we might make to the secretary and the deputy secretary on what investment decisions we might make,” Winnefeld said.

Congress has not passed a 2013 defense budget, so the federal government is currently operating under a continuing resolution. Further complicating things for Pentagon budget planners is about $500 billion in defense spending cuts slated begin in Jan. 2 and be spread over the next decade unless Congress strikes a deficit reduction deal.

“It’s possible that however this all falls out — and it’s very likely actually — that we have more difficult decisions ahead of us as a department,” Winnefeld said.


CyberCity allows government hackers to train for attacks

Washington Post

By Robert O’Harrow Jr., Published: November 26


CyberCity has all the makings of a regular town. There’s a bank, a hospital and a power plant. A train station operates near a water tower. The coffee shop offers free WiFi.

But only certain people can get in: government hackers preparing for battles in cyberspace.


The town is a virtual place that exists only on computer networks run by a New Jersey-based security firm working under contract with the U.S. Air Force. Computers simulate communications and operations, including e-mail, heating systems, a railroad and an online social networking site, dubbed FaceSpace.

Think of it as something like the mock desert towns that were constructed at military facilities to help American soldiers train for the war in Iraq. But here, the soldier-hackers from the Air Force and other branches of the military will practice attacking and defending the computers and networks that run the theoretical town. In one scenario, they will attempt to take control of a speeding train containing weapons of mass destruction.

To those who participate in the practice missions, the digital activity will look and feel real. The “city” will have more than 15,000 “people” who have e-mail accounts, work passwords and bank deposits. The power plant has employees. The hospital has patients. The coffeeshop customers will come and go, using the insecure WiFi system, just as in real life.

To reinforce the real-world consequences of cyberattacks, CyberCity will have a tabletop scale model of the town, including an electric train, a water tower and a miniature traffic light that will show when they have been attacked.

“It might look to some people like a toy or game,” Ed Skoudis, founder of Counter Hack, the security firm in central New Jersey that is developing the project, said recently while giving a reporter a tour of the fledgling system. “But cyberwarriors will learn from it.”

CyberCity provides insight into some of the Pentagon’s closely guarded plans for cyber war. It also reflects the government’s growing fears about the vulnerabilities of the computers that run the nation’s critical infrastructure. Last month, Defense Secretary Leon E. Panetta said that digital attacks “could be as destructive as the terrorist attack on 9/11” and virtually paralyze the country.

“If a crippling cyberattack were launched against our nation, the American people must be protected,” he said. “And if the commander in chief orders a response, the Defense Department must be ready to obey that order and to act.”

Behind those fears is an unsettling reality: Networks in the United States will remain vulnerable to attacks for the foreseeable future because no one understands cyberspace well enough to ensure security.

In the four decades since the Internet began, most cybersecurity research was conducted on the fly or as an afterthought, according to interviews with security specialists and computer scientists. Now, with the world linking up its communications, infrastructure, military, banking, medical and other systems at a lightning pace, the dynamic of cyberspace has grown too complex. Rigorous scientific experimentation that might lead to security breakthroughs is only beginning.

In the meantime, attackers hold a huge advantage. They can choose the time, place and method of strikes. Defenders almost always have to settle for reacting, making fixes after the damage has been done.

CyberCity aims to prepare government hackers to hold their own until long-term solutions can be found.

“The problem is the bad guys are getting better much faster than we are,” Skoudis said. “We don’t want to fall further behind on this.”


Realistic virtual environments

CyberCity is one of hundreds of virtual environments — often known as cyber ranges or test beds — launched in recent years by military, corporate and academic researchers to confront the mind-bending security challenges posed by cyberspace, where millions of attacks or intrusions occur every day.


Some small ranges study the effects of malicious software and viruses. Some hope to emulate the Internet itself and become scientific instruments of sorts, akin to mountaintop telescopes or particle accelerators, that will enable researchers to seek out the elusive fundamentals of cyberspace. The most ambitious of these, the National Cyber Range, was developed by the Defense Advanced Research Projects Agency. It has cost about $130 million since 2008. The agency said seven large-scale experiments have been conducted by Pentagon researchers.

Creating realistic virtual environments is extraordinarily challenging. In cyberspace, a global network of networks, more than 2 billion people interact with at least 12 billion computers and devices, including global positioning systems, mobile phones, satellites, data routers, ordinary desktop computers, and industrial control computers that run power plants, water systems and more.

In many cyber ranges, the simulated Web servers, routers, mobile phones and other network devices operate essentially as they do in the real world, but they have few if any physical components. The virtual devices simply exist as computer code.

Merit Network Inc., a nonprofit technology group in Michigan, just launched a cyber range at Eastern Michigan University that promises to conduct “live fire” exercises. The Defense Department runs the Information Assurance Range in Stafford County, Va. It gives cyber warriors a safe, closed environment to practice intrusions and security testing.

In Hampshire, England, and Millersville, Md., Northrop Grumman runs cyber ranges that allow corporate and government clients in the United Kingdom and the United States to create models of their own networks and employee activity. Northrop officials liken their systems to flight simulators.

Christopher Valentino, a research and development director in the cyberintelligence division of Northrop Grumman Information Systems, said one key to a successful range is closely approximating the way human psychology plays out on real networks.

“It’s very hard to find ‘normal,’ ” he said.

The University of Southern California’s Information Sciences Institute operates the Defense Technology Experimental Research (DETER) project, one of the most ambitious research ranges in the world. It is driven by 500 computers and funded by the Department of Homeland Security and the National Science Foundation. It aspires to become a leader in “cyber-security experimental science.”

“The development of a science of cybersecurity could take decades,” Fred B. Schneider, the Samuel B. Eckert professor of computer science at Cornell University and a Pentagon adviser, wrote recently in “The Next Wave,” a nonclassified publication of the National Security Agency. “The sooner we get started, the sooner we will have the basis for a principled set of solutions to the cybersecurity challenge before us.”


Network activity of 90 million

Two hundred miles south of Counter Hack and its CyberCity, computer researcher Pat McGarry demonstrated how some powerful cyber ranges attempt to approximate the mix of physics and psychology that rises out of the interaction of billions of people and machines online.

One day this fall, McGarryworked his way through menus on his computer at his home office in Arlington, making a series of choices, like a kid preparing to play a video game. He was setting up a test of a corporate network, using a cyber range in a “box.”


The box, made by his company, Ixia BreakingPoint, is a digital powerhouse seven-inches high and 19-inches wide that strings together the equivalent of 200 computer processors. The boxes start at $100,000, and top-of-the-line machines go for $1.2 million. Customers include the National Security Agency, the Defense Department’s Information Assurance Range, the DETER project and others.

With a click of his mouse, McGarry decided there would be 2 million “people” communicating on his cyber range. With another click, he ordered up much Web browsing and directed those computer users to send e-mail and download videos. (For verisimilitude, the machine generates some e-mails by drawing on real-life sources, such as the short stories of P.G. Wodehouse.) “How the deuce could Jeeves know anything about it?” one passage in a made-up e-mail said.

The firm says that by connecting multiple boxes together it can emulate the network activity of up to 90 million people.

“Think about how cool that is,” McGarry said.

To run his test, McGarry employed a digital model of a corporation’s network. And he selected some standard hacker methods to disable Web sites, steal passwords and find flaws that open the way for intrusions. When he hit enter, the network came alive and the automated attacks began.

As a torrent of traffic began flowing on the network. McGarry monitored the attacks. Ten minutes into the test, he saw that the virtual hackers he had unleased were able to break through firewalls and take control of the network.

Can the hacks be blocked entirely?

“The answer is a clear no,” he said.


Real-world effect of hacking

The idea for CyberCity grew out of conversations that Skoudis had two years ago with senior Air Force officials eager to convey to cyber warriors the impact that hacking can have on real-world operations such as water plants and power grids.

At the time, the Pentagon had recently declared cyberspace the newest domain of war. U.S. forces also had secretly launched cyberattacks against Iran’s nuclear enrichment facilities, disabling almost 1,000 uranium centrifuges in 2009 and 2010. That attack, disclosed this year, involved a malicious computer “worm” known as Stuxnet. It is the most notable attack on critical infrastructure that has come to light.

Skoudis ran a network-hacking training program called NetWars through the SANS Institute, a leading security organization that has trained thousands of government and civilian employees. Working through SANS, he agreed to create CyberCity for less than $1 million. It would be a modest range with an urgent, focused goal.

“We’re not trying to do a lot of theoretical work here,” Skoudis said. “Our focus is on very practical applications, training cyber warriors.”

The Air Force believes that training on cyber ranges is a key to keeping pace with changing threats from criminals, terrorists or even nation-states. The practice missions in CyberCity are expected to begin in the next few weeks.

“We are growing our abilities to use cyberspace to our advantage through training and trials in systems such as cyber ranges,” said Maj. Gen. Suzanne Vautrinot, commander of the 24th Air Force who oversees the service’s cyber operations. “We posture ourselves to move at the ever-changing speed of technology. We are able to do this successfully by providing operationally relevant ranges for operator training and operational test activities.”


This fall, Skoudis and a small team of hackers built CyberCity using the equivalent power of about 50 computers — along with servers in a data center south of Washington, D.C., that maintains records for the military and intelligence communities.

The team also is constructing a “kinetic space” — an old-fashioned scale model of the town — to allow the cyber warriors see evidence of their attacks. They bought the scale-model buildings, trains and other supplies from a hobby shop. With its water tower, train station and low-rise factory building, it resembles towns across New Jersey.

Skoudis stood over the unfinished scale model of CyberCity, picked up the train station and grinned.

“In the future, nearly all military missions will have a cyber component,” he said. “Fingers-on-keyboard experience is vital.”

Five cameras will be mounted around the scale models, providing streaming video of flashing lights and other indicators that the attacks have occurred. Some of the training scenarios sound like movie scripts. Skoudis said they are all plausible.

One scenario requires U.S. government hackers to raise a railroad drawbridge to prevent a train carrying a weapon of mass destruction from entering the city. Another involves a hijacked Navy vessel and plotters who have been communicating on FaceSpace. The mission of the good guys is to hack into FaceSpace and pinpoint the location of the hijackers through WiFi.

Tim Medin, one of the researchers on the project, recently demonstrated a third attack in the offices of Counter Hack. He typed commands on his laptop and entered CyberCity. His screen showed lines of code and commands. But he may as well have been sitting in the fictive city’s coffee shop. He was about to attack the hospital, using the shop’s free WiFi system.

Medin, playing the role of a foreign special forces operative, was intent on exploiting several computer systems, with the aim of assassinating a VIP at the hospital. In the scenario, cyber warriors would try to prevent that from happening by gaining control of the network and blocking the attacks.

Foreign intelligence operatives had been following a senior hospital doctor online and in person to prepare for the assault. The attack began when the doctor “entered” his favorite coffee shop and typed his user name and password into the hospital network. Because the WiFi system was open and unprotected, Medin was able to record the password and used it to get into the hospital’s electronic medical records system. Then he launched a ready-made attack — called an SQL Injection — that gave him control of the in-house Web-based prescription system.

Medin discovered that the target was highly allergic to a certain medication. Medin inserted the lethal drug into the target’s daily prescriptions. He said vulnerable software in the health-care industry makes such cyberattacks possible.

“It’s too insecure,” he said.


U.S. ‘Welcomes’ China Participation in Naval Drills

Defense News

Agence France-Presse

Nov 28 2012

BEIJING — The United States welcomes China’s participation in U.S.-led joint naval exercises next year, Navy Secretary Ray Mabus said Wednesday during an official visit to the country.

“We welcome China’s participation in the Rim of the Pacific Exercise in 2014,” Mabus said in a statement distributed by the U.S. embassy in Beijing.

The embassy could not confirm if China had formally accepted the invitation to participate, made by Defense Secretary Leon Panetta when he visited China in September.

Some 22 nations and more than 40 vessels took part in the latest round of the international maritime exercises, described by the U.S. Navy as the world’s largest, which took place from June 29 to August 3 around the Hawaiian Islands.

The U.S. invitation comes as Washington tries to reassure Beijing over its strategic “pivot” to the Pacific and China’s growing assertiveness in territorial disputes with several Asian neighbors.

“Cooperating with China to realize shared goals is important to the maintenance of peace and security in the Asia-Pacific region and central to our approach,” Mabus said.

China said Sunday it had carried out the first landing of a fighter jet on its new aircraft carrier in a move that extends Beijing’s ability to project its growing military might in territorial disputes.

Tensions between China and Japan, a U.S. ally, have risen dramatically in recent months over islands in the East China Sea which Beijing calls the Diaoyus and Tokyo, which administers them, names the Senkakus.

China is locked in similar rows with Vietnam and the Philippines over disputed territory in the South China Sea.

At a key Communist Party congress earlier this month, outgoing President Hu Jintao urged China to push forward fast-paced military modernization and set the goal of becoming a “maritime power”.



U.S. House Leaders Don’t Rule Out More Defense Cuts

Defense News

November 28, 2012


U.S. House leaders headed straight for the microphones after closed-door meetings Nov. 28 about the nation’s dire fiscal condition, but neither Republicans nor Democrats indicated they would oppose new Pentagon cuts.

The two House caucuses huddled separately to talk about ongoing congressional-White House talks aimed at avoiding a fiscal cliff. But when they emerged, most of their comments focused on tax rates, domestic entitlement programs and federal spending cuts.

Economists say the U.S. economy would tumble off a steep cliff if a slew of tax cuts expire and deep cuts to planned federal spending, including for the military, are allowed to kick in.

Lawmakers and President Barack Obama can avoid such a scenario by agreeing to cuts of at least $1.2 trillion from the federal deficit by Dec. 31. If they fail to pass that kind of bill, or one that delays the defense cuts, twin $500 billion reductions to planned domestic and defense spending would be triggered.

The absence of talk about the defense cuts is a sign that further Pentagon budget reductions, at some level below $500 billion, are on the table.

House Democratic Caucus Chairman John Larson of Connecticut urged Republicans to support Obama’s proposal to extend middle-class tax cuts in coming weeks, and leave the question of whether to raise new federal revenue in the lower chamber.

“We have clear agreement among Democrats and Republicans that we have near unanimous support on making sure the middle class is not impacted by the Dec. 31 deadline,” said Rep. Xavier Becerra of California, vice chairman of the Democratic Caucus.

“Where we disagree, let us push that off,” Larson said, “and where we agree, let us embrace.”

The Democratic leaders signaled they remain skeptical about major changes to Medicare and Medicaid.

House Republicans have raised hopes in recent weeks for a “grand bargain” deal that avoids across-the-board Pentagon spending cuts by stating they would support raising new federal revenues. For nearly two years, congressional Republicans and presidential candidates had held firm against new revenues.

But in a series of interviews this week on Capitol Hill, Republicans have said they now want Democrats to come to the table with savings from domestic entitlement programs. GOP leaders are pressing Obama, and congressional Democrats also are looking for federal spending cuts.

House Speaker John Boehner, R-Ohio, told reporters, “It’s time for the president and Democrats to get serious about the spending problem that we have.”

Rep. Eric Cantor, the No. 2 House Republican, said, “We have not seen any good faith effort to talk about the real problem we’re trying to fix.”

Cantor said Erskine Bowles, the Clinton-era White House chief of staff who was the co-chair of Obama’s 2010 fiscal commission, told Republicans, “There has been no serious discussion by the White House on Medicare and Medicaid.”

The Republican leaders made clear they oppose raising taxes on the wealthiest Americans and want entitlement program changes.

Neither party listed the Pentagon budget on their list of can’t-touch areas of the federal budget.

While Becerra and Boehner expressed confidence that Congress and Obama can strike some kind of deal by Dec. 31 that avoids the fiscal cliff, their comments show deep divides between the parties still exist.


White House raises objections to defense bill


Washington Post

By Steve Vogel,

Published: November 29


The White House on Thursday threatened to veto the 2013 defense budget bill now on the Senate floor if Congress does not make a number of changes to the legislation, ranging from limits on the transfer of detainees from Guantanamo Bay to cuts in the size of the Pentagon’s civilian and contractor workforce.

“If the bill is presented to the President for approval in its current form, the President’s senior advisers would recommend that the President veto the bill,” noted the statement issued Thursday by the White House’s Office of Management and Budget.

The administration objected to language in the National Defense Authorization Act that would reduce funding for the civilian and contractor workforce by a rate at least equal to the percentage of funding saved from planned reductions in military personnel.

“The Administration believes the size of the civilian workforce should be determined based on workload and funding, not on arbitrary comparisons to the military,” the statement said.

On Wednesday, Sen. Benjamin L. Cardin (D-Md.) introduced an amendment co-sponsored by seven other Democrats to change the provision, which he said would lead to “draconian” cuts costing 36,000 civilian jobs and tens of thousands of Defense contractor jobs between 2013 and 2017.

The White House also urged approval of proposed changes to the Tricare military health system, including increased fees that the OMB said are needed to “control the spiraling DOD health-care costs.”

The proposed restrictions on the use of funds to transfer prisoners from the military prison at Guantanamo Bay are similar to those in past versions of the legislation.

“Since these restrictions have been on the books, they have limited the Executive’s ability to manage military operations in an ongoing armed conflict, harmed the country’s diplomatic relations with allies and counterterrorism partners, and provided no benefit whatsoever to our national security,” the OMB statement said.

Sen. Carl Levin (D-Mich.), chairman of the chamber’s Armed Services Committee and the chief sponsor of the bill, had no immediate comment on the White House statement, a spokeswoman said. Levin is pushing the Senate to take action this week on the annual bill, which authorizes defense activities for the fiscal year that began in October.

Before being sent to President Obama, the Senate version will have to be reconciled with the bill already passed by the House.

The administration also “strongly” objected to language that is said would limit the Defense Department’s ability to procure alternative sources of energy for the military, including bio­fuels. The language was stripped from the bill by the Senate by a 62 to 37 vote Wednesday, but it remains in the House version.


The Senate on Wednesday also approved an amendment to the defense bill to require the Pentagon to create a comprehensive and standardized suicide prevention program.

The military has been plagued by increases in the number of suicides. As of the end of October, the number of suspected suicides by active-duty soldiers had reached 166, one more than the total for 2011.

“I think everyone in this body knows about, and is distressed by, the alarming rate of suicide and the mental health problems in our military and veterans populations,” Senate Veterans Affairs Committee Chairman Patty Murray (D-Wash.) said on the floor.

The legislation would also expand eligibility for some Department of Veterans Affairs mental health services to family members and strengthen oversight of the Pentagon’s mental health programs and the Integrated Disability Evaluation System established by VA and the Defense Department.

It would also promote the use of Iraq and Afghanistan veterans to provide peer counseling for fellow veterans, and require VA to establish accurate and reliable measures for mental health services.

Implementing the amendment would cost about $25 million over five years, according to an estimate from the Congressional Budget Office.


Microsoft’s Surface Windows 8 Pro: Far too expensive to be a hit


By Preston Gralla

November 30, 2012 1:04 PM EST


If Microsoft hopes to make inroads in the tablet market, it’s going about it in a very odd way: Pricing its products too high to gain much market share. The latest instance is the just-announced prices for the Surface Windows 8 Pro tablet, at $899 for a 64 GB version and $999 for the 128 GB version.

Panos Panay, General Manager of Microsoft Surface, announced the pricing on the Official Microsoft Blog. He also announced that the Surface Windows 8 Pro will be available in January.

Those Surface prices, by the way, don’t tell the true cost of the Surface models. Prices don’t include a Touch Cover or Type Cover, which cost at least $120. So that puts the prices at $1019 for the 64 GB version and $1119 for the 128 GB version.

You can buy an iPad for $499 (with 16 GB only; it costs $599 for the 32 GB model, and $699 for the 64 GB model.) So why would you want to pay more than $1,000 for a Surface tablet?

The answer is that you wouldn’t. At these prices, Surface Windows 8 Pro tablets are clearly aimed at enterprises, not the consumer market. And some analysts believe that Microsoft set the prices so high not in order to sell a lot of them, but to allow its competitor’s prices to seem like bargains, and so help them sell plenty of those.

Carolina Milanesi, an analyst at Gartner, told Computerworld:

“The Surface Pro pricing leaves room for device makers to come down in price without compromising margins too much. This is an enterprise play, not a consumer play, at least for now.”


One benefit of the Surface Windows 8 Pro over the RT-based Surface is that because it runs Window 8 rather than RT, it will run desktop apps, which the RT-based Surface won’t do. But at more than $1,000 that’s a steep price to pay. Enterprises can an buy Windows 8 notebooks or even ultrabooks for less money.

There’s another problem with aiming the Surface Pro at the enterprise market: Enterprises aren’t particularly keen on Windows 8 at the moment because it breaks so significantly with past versions of Windows. And in a BYOD world, there’s no reason to choose a Windows-based tablet over an iPad.

The upshot? Because of its pricing, I don’t expect the Surface Pro to be a winner.


Satellite photos showing North Korea rocket preparations raise speculation


Published November 30, 2012

Associated Press

SEOUL, South Korea – Rocket sections are apparently being trucked into North Korea’s northwest launch site, but some analysts are asking whether it’s just a calculated bluff meant to jangle the Obama administration and influence South Korean voters ahead of presidential elections in three weeks.

There are questions about whether North Korean scientists have corrected whatever caused the embarrassing crackup of its last rocket shortly after liftoff in April, and whether Pyongyang is willing to risk another failure — along with U.N. condemnation and more sanctions.

“It’s possible, of course, that Pyongyang knows its preparations will be seen and discussed in the West, and they are intended to be a signal rather than signs of an imminent launch,” David Wright, a physicist with the Union of Concerned Scientists, wrote on the organization’s website this week. “Preparing for a launch less than a year after a failure calls into question whether the North could have analyzed and fixed whatever went wrong.”

Before its last two launches, North Korea notified international organizations of its plans to send a satellite into orbit aboard a rocket. Neither the International Maritime Organization nor the International Civil Aviation Organization has responded to requests from The Associated Press for information. But South Korea and analysts say North Korea has yet to provide such notification, something that usually happens weeks in advance.

Even if a launch never comes, the mere preparations could be an attempt to influence the Dec. 19 presidential election in rival South Korea and raise Pyongyang on President Barack Obama’s list of foreign policy priorities as he prepares to be inaugurated for his second term in January.

North Korea has repeatedly tried to interfere with South Korean elections, according to government officials and analysts, and there’s speculation that Pyongyang’s rocket work could be an attempt to raise worries as campaigning heats up.

North Korea presumably prefers the liberal candidate, Moon Jae-in, the argument goes. Another provocation, or simply heightened tensions, could be seen by voters as evidence of a failed North Korea policy by the current conservative leader in Seoul.

Both Moon and the conservative contender, Park Geun-hye, have signaled a softening on North Korea policy. But Moon has suggested a return to an accommodating policy of engagement and aid for Pyongyang that has been missing during the five years of President Lee Myung-bak’s rule, which ends in February when his single term expires.


“If indeed a new satellite launch is North Korea’s next provocation, it will be an early test of South Korean candidate commitments to reopen dialogue with the North,” Scott Snyder, senior fellow for Korea studies at the Council on Foreign Relations, wrote this week.

Pyongyang could also be trying to send a message to Obama following his re-election. Pyongyang has previously staged what Washington and Seoul consider provocations around elections in both the United States and South Korea. North Korea conducted a rocket and nuclear test within months of Obama taking office in early 2009.

Washington worries about North Korean launches because long-range rocket technology can be easily converted into use for missiles that could target the United States.

Analysis of recent satellite images written for 38 North, the website for the U.S.-Korea Institute at Johns Hopkins School of Advanced International Studies, suggests Pyongyang could be ready to launch a three-stage rocket by the end of the first week in December.

The timing of the preparations has some analysts expecting a launch.

North Korea’s April rocket firing came during celebrations of the centennial of the birth of national founder Kim Il Sung, current leader Kim Jong Un’s grandfather. Pyongyang has declared 2012 a crucial year for its scientific and economic development, and there has been speculation that it could do something extraordinary to mark its conclusion.

Dec. 17 also marks the one-year anniversary of the death of Kim Jong Un’s father, Kim Jong Il.

Because North Korea’s missile and nuclear programs aren’t transparent, said Daniel Pinkston, a North Korea analyst at the International Crisis Group, outsiders cannot determine what went wrong with the April test and what scientists are doing to address the problem.

Any launch attempt raises the specter of failure, Pinkston said, but “they call it rocket science because … it’s hard. Everyone makes mistakes … but every time you test, you get to go back and work on those problems and fix them.”

Baek Seung-joo, an analyst at the state-run Korea Institute for Defense Analyses in South Korea, said past failure could actually be a spur to try again.

“North Korea needs to redeem its embarrassing rocket failure in April,” he said.


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