U.S. Response:  Future Terrorist Attack Could Devastate Economy, Insurance Analysts Say

By Kerry Boyd
Global Security Newswire

The economic consequences of another major U.S. terrorist attack would be more severe than those of the Sept. 11 attacks, the General Accounting Office told a House panel examining terrorism insurance yesterday.

As terrorism insurance availability decreases and the government does not take action, businesses are significantly more vulnerable to damages caused by terrorism, GAO analyst Richard Hillman said in testimony to the House Financial Services Subcommittee on Oversight and Investigations.

Insurers have begun to withdraw terrorism insurance policies, several experts said.  Before Sept. 11, most insurers calculated the risk of terrorism as very low, so they did not even price the potential losses from terrorist attacks, Hillman said.  The Sept. 11 attacks, however, cost the insurance industry between $36 billion and $54 billion, according to generally accepted estimates, according to Deputy Assistant Treasury Secretary for Economic Policy Mark Warshawsky in his testimony, adding that the losses are the largest in the industry’s history.

Since the New York and Washington attacks, insurers have decided the likelihood of an attack is so difficult to predict — and the potential costs so high — that they cannot calculate the price of insurance.

“Their response to any risk they consider uninsurable … is not to offer insurance,” Hillman said.

Insurance companies are therefore trying to stop providing terrorism insurance.  “Insurance for losses from terrorism is disappearing, particularly for large businesses and those perceived to be at some risk,” Hillman said.

Reinsurers Pass the Buck

Reinsurance companies, which provide insurance to primary insurance companies, have mostly stopped providing terrorism insurance, Hillman said.  Reinsurers face few obstacles to withdraw terrorism insurance, because they are subject to few legal regulations, Hillman added.

Once reinsurance companies stop providing terrorism coverage, primary insurers must absorb the potential costs, and they become much more vulnerable to risk.

“Reinsurance is a vitally important element of the insurance industry’s capacity to provide coverage to policyholders,” Hillman said.

Regulatory constraints and legal requirements have made primary insurers slower to end terrorism coverage, but they are nonetheless trying to pull out from providing terrorism coverage, and many industry observers say they must do so or face severe exposure to risk, Hillman said.

The Insurance Service Office asked states to allow primary insurers to drop terrorism coverage, and 45 states agreed, although companies must still provide coverage in some circumstances, such as workers’ compensation plans, Hillman said.

Effects Ripple Through Economy

As insurance companies drop terrorism coverage, “many businesses, particularly those in large metropolitan areas, are already beginning to experience difficulty obtaining terrorism coverage as their insurance policies come to renewal,” Hillman said.  When companies cannot acquire terrorism insurance, they must accept all potential risk from terrorism attacks alone.

“The shifting risk from reinsurers to primary insurers to commercial policyholders and other affected parties could place more risk and economic burden on businesses and the public at large should another terrorist attack similar to Sept. 11 occur,” Hillman said.  “Consequently, a lack of such coverage in the event of another attack could have much broader effects on the economy.”

Even if no future attack occurs, the lack of terrorism insurance could hurt the economy.  If companies do not have terrorism insurance, they often find it difficult or impossible to obtain loans and financing.

Several witnesses at the subcommittee hearing listed examples of property owners and businesses that have already experienced problems obtaining loans and investment.

“Several developers, financers and insurance industry observers noted a number of examples where lenders or investors were reluctant to commit resources to projects that could not be insured against terrorist acts,” Hillman said.

Other Types of Coverage Also Affected

Commercial property and casualty insurance policies not related to terrorism have increased in price by an average of about 40 to 70 percent, according to Warshawsky.  Although prices were rising before Sept. 11, “the recent increases have been so dramatic that they harm the nation’s economic recovery,” he said.

New York hospitals, for example, have experienced problems obtaining property insurance since Sept. 11, said Gregory Serio, superintendent of insurance for the New York State Insurance Department.

“A major New York philanthropic organization, which operates a number of hospitals throughout the New York metropolitan area … renewed its property insurance coverage on Nov. 1, 2001, but was able to obtain only 20 percent of the expiring policy’s coverage limits” despite terrorism exclusions and a higher premium, Serio said.

Need for Congressional Action

Although the House of Representatives passed legislation in December to provide a government backup for insurance companies in terrorist incidents, the Senate failed to pass such language(see GSN, Dec. 21).  Financial Services Committee Chairman Michael Oxley (R-Ohio) urged Congress to pass a backup plan. 

“We have concluded that the legislative imperative is still very real and continues to grow day by day.  While the sky is not falling, it is certainly cracking around the edges,” he said.

“At least in the short term, this market has not and cannot protect our markets without a federal backstop … The passage of terrorism risk insurance legislation now is an insurance policy for the U.S. economy,” Oxley said.

“I sincerely hope that the Senate leadership will act quickly to avoid a potential calamity,” said Subcommittee Chair Sue Kelly (R-N.Y.).

Warshawsky also urged Congress to take action.  “The implication of these insurance market conditions and economic consequences makes it critical,” he said.

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Iraq:  WMD Capabilities Remain Strong, Analysts Say

By Greg Seigle
Global Security Newswire

WASHINGTON — Iraq possesses substantial WMD capabilities except for nuclear weapons, and all it needs to complete manufacturing nuclear bombs is smuggled fission or “dirty” radiological materials, two U.S.  weapons experts told the Senate Armed Services Committee yesterday.

While cautioning that it is difficult to gauge the full extent of Iraqi programs for weapons of mass destruction, a former U.N.  Special Commission inspector and a former Senate aide testified that Iraq’s biological weapons programs constitute a serious threat, and its nuclear programs are well developed, lacking only materials that could be delivered by agents well-honed in smuggling. 

“Iraq has significant WMD capabilities in all areas except nuclear,” said Charles Duelfer, a resident visiting scholar at the Center for Strategic and International Studies who spent much of the 1990s scouring Iraq for WMD evidence as an UNSCOM inspector.  “However, the intellectual capital remains, as does the will of the leadership, to achieve a nuclear capability.”

“The issue is not whether Iraq has yet achieved nuclear weapons or extremely lethal biological weapons,” said Anthony Cordesman, a former aide to Senator John McCain (R-Ariz.) now a Center for Strategic and International Studies analyst. 

“It is that this regime will eventually acquire nuclear weapons and biological weapons with equal or greater lethality if it is given the time and opportunity to do so,” said Cordesman, who has written extensively about WMD programs in Iraq, Iran, North Korea and other countries.  “It will not change character or somehow enter the mythical ‘family of nations.’”

Breaking down Iraq’s missile and chemical, biological, radiological and nuclear (CBRN) weapons programs, the pair said details are scarce about what advancements President Saddam Hussein’s regime has made since it expelled UNSCOM inspectors in 1998.  However, based on limited information obtained by UNSCOM and Iraqi defectors since, it is clear the country maintains large chemical stockpiles and is aggressively developing a far-flung biological arsenal overseen by its Special Security Organization, or Amn al-Khass, the Iraqi intelligence agency.

Missile Programs Remain Active

The 1991 Persian Gulf War and subsequent UNSCOM inspections seriously degraded Iraq’s missile and chemical weapon programs.  Work on both programs is believed to continue at a brisk pace, but at a diminished state from Iraq’s wide-scale production of missiles and chemicals during the 1980s.

While Iraq may only have “a relatively small number” of Scud missiles left from Soviet purchases made before the Gulf War, it maintains the capability to build them indigenously, Duelfer testified. 

“In my view it is likely Iraq retains a small long-range missile force, perhaps 12 to 14 missiles, that would serve the purpose of a strategic reserve,” Duelfer said.

Because U.N. resolutions allow Iraq to continue building missiles effective up to a 150-kilometer range, the country maintains a missile development and production infrastructure, Duelfer said.  The country has at least 1,400 al-Samoud short-range missiles, many of which can be armed with chemical or biological weapons, he said. 

Even when UNSCOM inspectors were in the country the Iraqis continued work on improving warhead fusing and staging to increase effectiveness and range, he added.

“Iraq will continue to try to develop long-range missiles but has long had other delivery options and will almost certainly try to improve them,” Cordesman said.

Chemical Stockpiles Militarized

Iraq built up massive chemical weapons stockpiles prior to the Gulf War, and although sizeable amounts were found and destroyed by UNSCOM until 1998, it is believed there are large caches left, the experts testified. 

Iraq claims most of its chemical weapons, mostly nerve gases and blistering agents, were spent during the Iran-Iraq war of 1980-88, a contention most Western analysts doubt.  In 1998 UNSCOM discovered an Iraqi Air Force document that contradicted prior Iraqi claims that its chemical arsenal had been depleted, a document that was promptly seized back by Iraqi officials, Duelfer said.

“The one document that UNSCOM did receive,” Duelfer said, provided guidance on how to manufacture the most dangerous types of chemical weapons in large quantities.  “There remains considerable uncertainty about the extent of this program and its disposition.  There was a pattern to Iraqi revelations that they gave up the oldest and least advanced projects and materials most readily.

“UNSCOM accounted for and destroyed huge amounts of chemical agents, munitions, production equipment and precursors,” he continued.  “Yet there certainly remained unaccounted materials for the production of both precursors and final agent.  Iraq can make munitions indigenously and can probably make chemical production equipment indigenously.  The expertise for such work remains.”

Iraq seems particularly interested in VX nerve gas, a highly lethal agent, Duelfer said.  Iraqi scientists are likely pursuing the ability to make cluster munitions, which would make it easier to spread a chemical agent, and aerial spray devices, including unmanned airplanes a remote pilot could use to spray chemical or even biological weapons, he added.

Biological Weapons of Great Concern

Iraqi scientists under Special Security Organization control are undoubtedly pursuing the development of biological weapons, including genetically modified agents that could resist vaccines or antidotes and other pathogens that would be hard to trace back to Baghdad, the experts testified (see GSN, Nov. 30, 2001).

In addition to focusing on anthrax, botulinum toxin and aflatoxin, the scientists are also known to have conducted work on wheat smut, which could used to kill crops or create a epidemic similar the foot and mouth disease that plagued Britain in recent years, they said.

Perhaps most disturbing, Iraqi officials seem keenly aware that biological weapons could enable them to strike without leaving a clear indicator that the attacks came from Iraq, they added.

“It was clear that Iraq understood that depending on the method of dispersal, the origin of the agent could be concealed,” Duelfer said.  “In other words, they understood the potential for conducting an attack that would be near impossible to connect to Baghdad as the responsible actor.”

Iraq is not known to have a history of contracting other countries’ terrorist groups but is believed to harbor, supply and even train members of a couple of terrorist groups (See GSN, Nov. 26, 2001). 

“A covert and/or unattributable attack is possible, particularly under false-flag conditions or ones where Iraq might be able to piggyback on an attack by a known terrorist group,” Cordesman said.  “Other nations, such as Iran, might in turn conduct false flag attacks designed to implicate Iraq.”

Nuclear Weapons Need Fissile Materials

The Iraqi nuclear programs that started in the 1970s remain well developed, and lack only key ingredients to actually make a nuclear or radiological bomb, the analysts told the Senate committee.

“The key hurdle for Iraq to surmount to obtain a nuclear weapon is the acquisition of fissile material,” Duelfer testified.  “Iraq had a viable weapon design and the capacity to produce all the elements of a weapon.  Predictions on when Iraq will achieve a weapon depend on whether Iraq can obtain fissile material by smuggling or they have to produce it themselves which will take much longer.”

The nuclear program was active even when UNSCOM inspectors were scouring the country and conducting surprise inspections, Duelfer said.  Nuclear experts were secretly concentrated at various locations, including the Ibn Sina, al-Raya, al-Tahaddi and the Sa’ad Center, which is across the street from the Rasheed Hotel in Baghdad often used by foreign visitors, Duelfer said.

Even if a new, more aggressive U.N. inspection regime is eventually allowed back inside Iraq, inspectors “cannot hope to detect a covert biological program with nuclear lethalities, and they cannot hope to prevent Iraq from assembling a nuclear device if it can obtain fissile or ‘dirty’ fissile material from outside Iraq,” Cordesman said.  “In fact, efforts directed at large, observable Iraqi CBRN and missile activities may simply push Iraq into concentrating on biological weapons and asymmetrical means of delivery.”

Hussein’s regime appears determined to build up its WMD arsenal at almost any cost, even the suffering of Iraq’s population under the U.N. economic sanctions, the experts said.

“Ever since the end of the Gulf War, Iraq has made its missile and CBRN programs its single highest national priority,” said Cordesman.  “In fact, there are strong indications Iraq not only did everything possible to retain its pre-Gulf War capabilities in spite of UNSCOM inspections, but created new, highly compartmented black programs in case UNSCOM could succeed in tracking down all the programs it had in place in 1991.”

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U.S. Response:  WMD “Candy Store” Must be Closed, Biden Says

The United States should work to prevent the black-market sale of Russian weapons of mass destruction, rather than focusing on the development of a missile defense system, Senate Foreign Relations Committee Chairman Joseph Biden (D-Del.) wrote today in a Chicago Tribune commentary (see GSN, Feb. 8).

“Many Americans forget that without a nuclear, biological or chemical warhead, an ICBM is worthless,” Biden wrote.  “After Sept. 11, no one should doubt that future attacks are far more likely to come on a ship bearing a smuggled nuclear weapon, a vial of biological toxins in a backpack or a chemical agent dispersed in a crowded subway system.  And our budget priority must reflect the urgency of such threats.”

The Bush administration’s fiscal 2003 budget proposal either holds steady or cuts funding for most nonproliferation programs, Biden said, adding that a small number see a slight increase in funding (see GSN, Jan. 10).  A bipartisan panel found that $3 billion per year would be needed to adequately safeguard Russian weapons of mass destruction, but almost $8 billion was allocated in fiscal 2002 for missile defense and a similar amount was proposed for fiscal 2003, he said.

“It doesn’t make sense to focus on the potential last line of defense when we need to do so much to bolster the more achievable first line of defense,” Biden wrote.

There are several ways the United States could reduce the threat posed by the proliferation of Russian weapons of mass destruction, Biden said.  One way would be to double the size of the U.S. Energy Department’s Materials Protection, Control and Accounting program.  The United States should also forgive a quantity of Russia’s Soviet-era debt in return for a reciprocal investment in nonproliferation programs (see GSN, Oct. 29, 2001).  Russia could also cut off technical aid to Iran’s nuclear and ballistic missile programs, Biden said (see GSN, Jan. 22).

“Denying access to bioterrorists and their supporters in rogue regimes to weapons of mass destruction is one of the most important battles we face,” Biden wrote.  “Shutting down Russia’s candy store is the place to begin” (Joseph Biden, Chicago Tribune, Feb. 28).

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United States I:  Lawmakers Examine Progress on NNSA Organization

By Mike Nartker
Global Security Newswire

WASHINGTON — Congressional witnesses Tuesday debated the effectiveness of recent organizational efforts by the U.S. National Nuclear Security Administration (see GSN, Jan. 2).

The NNSA had instituted several organizational measures to improve effectiveness and efficiency since a May 2001 report to Congress, NNSA Administrator John Gordon told the House Armed Services Special Oversight Panel on Department of Energy Reorganization.

“I believe our efforts, and our recently announced plans, have placed us on the right path to achieving our vision of an integrated nuclear security enterprise operating an efficient and agile nuclear weapons complex,” Gordon said.

Gordon said the agency has taken several steps, including a installation of a new structure consolidating NNSA headquarters support functions; installation of new leadership; integration of decision making with a new Management Council; adoption of a planning, budgeting and evaluation system for business processes; better definition of the NNSA’s place in the Energy Department and resolution of other organizational problems not covered by the May report.

The NNSA this week submitted a report to Congress describing how the organization plans to delineate responsibilities between headquarters and field units, Gordon said.

The new plan will simplify the organizational structure between the NNSA and various nuclear weapon laboratories by removing two federal management layers, he said.  Under the new plan, each facility will report to a NNSA site office, which would report to the NNSA administrator.

The NNSA hopes to streamline its workforce by reducing the numbers of separate offices and federal employees, Gordon said.  Those employees not involved with “core functions” will either be retrained or redeployed, he said. 

The NNSA will also streamline its procedures to reduce unnecessary details in NNSA policy, guidance orders and contracts, Gordon said.  This, in turn, will reduce the administrative burdens on NNSA contractors, he added.

“As a result, laboratory and production plant contractors will be given clearer and more consistent expectations and will be held directly accountable for achieving the results required to achieve our mission,” Gordon said.

Work Still Needs to Be Done, GAO Says

Even though the NNSA has made progress in restructuring its headquarters’ organization last May, it still has not implemented an overall organizational structure, Gary Jones, General Accounting Office director of natural resources and environment, told the House oversight panel. 

“While we are hopeful that resolution of long-standing organizational issues may now be within NNSA’s grasp, without the discipline of an implementation plan, reaching NNSA’s goals is likely to be a long and arduous process that could take several years,” Jones said.

The NNSA has lost momentum in putting into place a new planning and budgeting process envisioned by Gordon, Jones said.  Even though the agency has created a “conceptual” planning, programming and budgeting process, it still has much work to do by the fiscal 2004 budget cycle, Jones said.

The NNSA also lacks a sizeable staff to be able to carry out any new organization, Jones said, adding that the agency has used only 19 of its 300 excepted service positions.

“NNSA does not yet have a long-term strategic approach to ensure a well-managed, properly sized and skilled workforce over the long run,” Jones said.  “Such a plan is vital to effective implementation of NNSA’s new organization.”

Jones said the GAO understands that it will take time for the NNSA to fully create and implement an effective organizational structure.

“However, we believe the best time to address long-standing problems is when the new organization and systems are first being laid out and the momentum for change is at its highest,” Jones said.  “NNSA needs to move forward aggressively so that this opportunity does not slip away and old ways reemerge and harden.”

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United States II:  Cold War Tests Distributed Fallout Across Country, Report Says

At least 15,000 U.S. deaths from cancer since 1951 probably resulted from fallout that was spread over the country through aboveground nuclear weapon testing, according to data from an unreleased federal study, USA Today reported today.

According to the study, radioactive fallout spread over most of the United States from aboveground nuclear weapon tests conducted by the former Soviet Union, the United States and the United Kingdom on several Pacific islands and at the Nevada Test Site.  No U.S. resident born after 1951 has escaped exposure to radiation, the study said.

About 22,000 cases of cancer were probably caused by external exposure to fallout, the study concluded.  Thousands of other cancer cases were likely caused by internal radiation exposure, such as that from eating tainted food, the study found.

Heavy amounts of fallout were discovered in Iowa, Tennessee, California, Oregon, Washington and Idaho, according to the study.  Fallout from aboveground nuclear weapons tests at the Nevada Test Site primarily was dispersed over mountain and Midwest states.

Click here to see a map illustrating the level of fallout by U.S. county.

The study’s estimates on the spread of radioactive fallout are based on computer analyses of factors such as weather patterns, population trends and other data, according to USA Today.

Nuclear weapon countries “owe the world a real accounting of what they did to its health,” said Arjun Makhijani of the Institute for Energy and Environmental Research.  “The U.S. has been the only honest country so far” (Peter Eisler, USA Today, Feb. 28).

In U.S. counties with the highest level of fallout, radiation exposure was equal to a person receiving one chest X-ray per year of residency since 1951, with the exposure level diminishing after 1963, the study found.

The U.S. Centers for Disease Control and Prevention and the National Cancer Institute conducted the study, which cost $1.8 million and took two years to complete, according to USA Today.  The Health and Human Services Department, which oversees the two agencies, has delayed the release of the study since last summer because of “internal reviews.”

Some members of Congress, however, have demanded the study’s public release.

“Some federal government bureaucrat has been holding onto this information for the past months and years,” said Senator Tom Harkin (D-Iowa).  “No more stalling … We need to fully assess the threats posed by the radioactive (fallout).”

The fallout still poses some risk because isotopes can still be radioactive many years later, said Seth Tuler, a member of the Federal Advisory Committee on Energy-Related Epidemiological Research.

“From a public health perspective, it’s important to identify where these contaminants fell,” Tuler said.  “It allows people to take steps to limit their risks.  If they think they might have a problem or if they’re worried, they can ask their doctors.”

There is also a need for a follow-up study, especially one that could help researchers better predict the risks posed by fallout exposure, scientists said.

“It’s important,” said David Rush, a professor at Tufts University.  “God didn’t make this problem.  We did” (Peter Eisler, USA Today II, Feb. 28).

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United States III:  Monitoring Program Needed on Amchitka Island, Alaska Says

An Alaskan official yesterday attempted to convince the U.S. Energy Department to begin monitoring Amchitka Island for radioactive substances that might be leaking into the Bering Sea (see related GSN story, today).

State officials believe that the island, part of the Aleutian chain, needs extensive studies and monitoring programs to find out whether radioactive contaminants — from underground nuclear weapons tests in the 1960s and 1970s — have begun to leak (see GSN, Feb. 25).

“The question of contamination is not ‘if.’  It’s ‘when,’” said Michelle Brown, commissioner of the Alaska Department of Environmental Conservation.

While in Washington yesterday, Brown tried to set up a meeting with Energy Assistant Secretary Jessie Roberson.  Last August, Brown requested that the Energy Department fund such studies, but the department denied her request, according to the Anchorage Daily News.

Radioactive contamination on Amchitka Island might not leak for hundreds, if not thousands of years, said Brown and a panel of scientists examining the situation on the island.  It also might have already begun leaking, they said.

“There is no emergency, in the sense that there’s no measurement that indicates leakage,” said John Eichelberger, a volcanologist at the University of Alaska-Fairbanks.  “But on the other hand, there’s a kind of appalling ignorance because there has not been any serious monitoring there for many years.”

The Energy Department is waiting for the completion of a risk analysis based on data collected from Amchitka Island in preparation for developing a monitoring program, said department officials.  The risk analysis was supposed to be finished by this spring, but that date has now been pushed back to September, said Energy Department officials at the Nevada Operations Office.

“Basically, we got a 30-some percent projected cut from our budget,” said Runore Wycoff, director of the environmental resource division in charge of the Amchitka Island project.  “It affects all our programs, not just Amchitka” (Don Hunter, Anchorage Daily News, Feb. 27).

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United States IV:  Tests Begin on Bunker-Busting Warhead Design

The U.S. Energy Department’s Sandia National Laboratories has begun testing designs for a new type of nuclear warhead that could be used to destroy underground bunkers, Sandia President C. Paul Robinson said Tuesday (see GSN, Feb. 20).

Researchers have used a large cannon to fire projectiles at targets made of rock and steel to simulate the force of a warhead hitting the Earth at high speeds, Robinson said.  The new tests build on a warhead design created in the late 1980s that was tested and certified for manufacture but ultimately shelved, he said.

“We picked it up as a point of departure,” Robinson said, referring to the 1980s design.

In the mid-1990s, Sandia researchers created a new steel case for an existing bomb that allowed it to survive slamming into the Earth, a requirement for a “bunker-busting” bomb, Robinson said.  Creating a ballistic missile warhead that can survive the same impact, however, is much more difficult because of the higher speeds involved, he said.

The tests are to help develop a conceptual design for any new nuclear weapons, said Sandia Vice President Joan Woodard.  She added that the U.S. military has not placed any purchase orders for the warhead and that the design could be used to develop bunker-busting bombs armed with conventional explosives.

The bunker-busting warhead development program is a component of an expanded nuclear weapons budget at the Sandia laboratories, according to the Albuquerque Journal (see GSN, Feb. 19).  The Bush administration included a 13 percent increase in funds for Sandia’s nuclear weapons development program in its fiscal 2003 budget proposal (John Fleck, Albuquerque Journal, Feb. 27).

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Russia-Kazakhstan:  Researchers Cooperate on Vozrozhdeniya

The Russian Civil Defense, Emergencies and Natural Disasters Ministry will join a team of Kazakh investigators on Vozrozhdeniya Island — which is now a peninsula — in the Aral Sea, a former Soviet testing ground for biological weapons (see GSN, Jan. 22).

The island was used as a dumping ground for buried anthrax spores from the former Soviet Union’s biological weapons program.

The Russian and Kazakh teams are developing a research plan and discussing funding options, according to Gennadiy Korotkin, Russian emergencies deputy minister.  One possible funding source is the money Russia pays Kazakhstan to lease the Baikonur space launch site in the Kzyl-Orda region, Korotkin said.

Russian Civil Defense, Emergencies and Natural Disaster Minister Sergey Shoygu is to sign a final agreement on cooperative research during a visit to Kazakhstan in May, Korotkin said.  Russia also plans to sign a similar agreement with Uzbekistan, which owns two-thirds of the island.  Kazakhstan owns one-third (Interfax-Kazakhstan news agency/BBC Monitoring, Feb. 27).

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U.S. Plans I:  Official Touts Recent Intercept Test Successes

By David Ruppe
Global Security Newswire

WASHINGTON — A senior Pentagon official yesterday said the United States should have a ground-based missile defense system capable of knocking a North Korean nuclear warhead out in space by 2004.

The prediction came amid questioning by congressional Democrats on whether the military’s multiprogram missile defense effort will ever bear fruit, given the current available evidence.

"Should we choose to put it on alert and it works as we think it will, based on our test to date, I would have a high confidence that we could be successful,” said Missile Defense Agency Director Lt. Gen. Ronald Kadish, testifying before a joint hearing of the House Armed Services Military Procurement and Research and Development subcommittees.

“But again, against a very, very limited — though unannounced as you point out — activity," he said.

Without some minimal assurance that missile defenses will ultimately work, said Representative Gene Taylor (D-Miss.), the program is not worth the risk and funds that could be spent elsewhere.

The missile defense program is “coming at the expense of other defense needs ... And I hope the general can tell us that somehow what we're doing is really worthwhile for the American taxpayer,” he said.

Taylor called for practical results.

“I would hope one question that Gen. Kadish would answer today, in fairness to the American people who are footing this bill, is that after $60 billion, if the North Koreans told us a week ahead of time that they were going to fire one missile with no decoys — no chaff — if they told us a week ahead of time the city that they were going to launch the missile from and gave us the exact time of day that they were going to launch this missile — what are the chances that ... you could shoot it down?” Taylor said.

Asked later in the hearing, Kadish said he thought the system's initial five-missile "test bed" deployment in Alaska would be ready to knock out an unannounced North Korean warhead by 2004, President George W. Bush's target year for deployment.

With respect to defeating other missiles launched simultaneously, Kadish said he would discuss that in closed session.

Tests Not Proof of Ultimate Effectiveness

Pentagon officials have said testing of the ground-based national defense system, still in its early stages, has been simplified to test specific aspects while keeping other important elements controlled.  For instance, beacons have guided interceptors to targets, and the number and qualities of decoys have been simplified in initial testing.

Officials said a Navy theater missile defense system test last month was a “fly-by” test.  Its primary goal was not to actually hit the target but to reach its general vicinity.  The Pentagon declared the test a success and said it was a bonus that the intercepting “kill vehicle” did in fact hit the oversized target.

Facing criticism in recent years after failed high-profile attempts to test the ground-based system’s ability to knock a mock enemy warhead out in space, Pentagon officials have said such testing does not necessarily validate or invalidate the system.

The purpose of each test, they said, is not to prove the system, but rather to identify whether specific elements of a system need further development.

“As we've been saying for a long time, no one test tends to tell you everything you need to know,” Kadish told reporters in July 2000 after a failed intercept test.

Signs of Effectiveness?

The Pentagon now, however, has begun touting recent successful tests of ballistic missile defense programs as evidence the system is headed for effective operation.

“Successful flight tests over the past year represent a step forward on the road to deploying effective defenses to protect the American people, its friends, allies and troops abroad,” said the Defense Department proposal in president’s suggested fiscal 2003 budget, released earlier this month.

The document also acknowledged, though, that testing does not yet mirror real world conditions.

“DOD plans to pursue more aggressive exploration and realistic testing of key technologies to counter ballistic missiles in all phases of their flight,” it said.

Kadish began his testimony in an unusual way.  He rolled video showing tests of various elements of the various programs that compose the nation’s ballistic missile effort.

The presentation did not go over quite as planned, however, showing what appeared to some to be a failed attempt to shoot a target out of the sky.

“I think that we actually might have the wrong film now,” said Kadish.

“That one missed.  It went back down into the water, General,” said Representative Duncan Hunter (R-Calif.), a missile defense supporter who chaired the hearing.

Kadish then clarified that the test was actually successful.  It was considered a “fly-by” test, he said, and “it actually flew by, so it was a success.”

Yesterday Kadish went on to show hearing participants clips of successful tests of Patriot-3, Israeli Arrow, airborne laser and ground-based systems.

He also showed footage of failed tests, including one of the ground-based system, for which he said, “We've got some work to do here, but we have a method to hedge this risk, and I believe we're on track to do that.”

He also acknowledged “major technical challenges ahead.”

Kadish noted, though, that the record for the system is three successful tests out of five.  He said the results on the film offer proof the program is gaining ground.

“Now, that's all the film I have to show you, but I thought it was important not to assert that we're making progress, but to show you the visual proof that we are making progress,” he said.

A Desire for Proof

As with any system under development, the ultimate effectiveness of the ground-based system — and how much it will cost to get it there — may only be known once it is tested under realistic conditions.

Some Democrats and independent scientific experts have questioned whether it ever will be, and have questioned whether the money can better be spent on other defense priorities.

“We have a real immediate need in the war against terrorism. We need to replenish our spent stockpiles of smart munitions.  The administration is proposing buying only five ships when the immediate need is for eight ships.  And we're purchasing far less aircraft than our aging fleet demands,” said Representative Marty Meehan (D-Mass.).

The Bush administration intends to go ahead with the system and begin deploying it by 2004, before the system is intercept-tested under a variety of realistic conditions.  At the soonest, such tests would begin by 2007 or 2008, according to a July 2001 Union of Concerned Scientists estimate.

Adopting a novel “capabilities-based” approach to weapons acquisition, the Missile Defense Agency last month discarded the traditional “requirement-based” approach of setting specific assessment tests to require before fielding the system.  The new approach is the best way to develop the program’s many “cutting edge” technologies, said Kadish.  “Our program, in short, has no precedence.”

The traditional development approach of setting specific requirements could hamper the system’s growth as technologies are developed, tested, and redeveloped, kept or discarded, and as the threat may change.

That approach is rigorous, Kadish said, “but that very rigor translates to a lack of flexibility needed in what we face in missile defense.”

Disagreeing, Meehan said the new approach hampers the program’s accountability.  He equated it to “adoption of the old Soviet Union's ‘buy first, think later’ acquisition policy that develops anything imaginable without regard for utility, which is to say, no real acquisition policy at all.”

“As far as I know,” he said, “the last significant use of spiral acquisition was in the Soviet Union, and the result of that was national bankruptcy and a field full of barely functional weapons that posed more of a threat to their users than they did the enemy.”

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U.S. Plans II:  Allies Debate Costs as Pentagon Prepares Interceptors for 2004

The United States will probably have four prototype interceptors capable of destroying long-range missiles ready in September 2004, Deputy Defense Secretary Paul Wolfowitz said yesterday during testimony before the a Senate Appropriations subcommittee on defense.

The United States will build silos for missile interceptors at Fort Greely, Alaska, Wolfowitz said (Matt Kelley, Associated Press/Yahoo.com, Feb. 27).

United Kingdom Debates Role in U.S. Missile Defense System

Meanwhile, British officials yesterday continued to debate what role the United Kingdom should play in a U.S. missile defense system (see GSN, Nov. 21, 2001).  The United States has not formally requested the use of British bases for a missile defense system, but it probably will, British Defense Ministry officials said.

“The facilities feature very large in their [U.S.] calculations,” said defense official Brian Hawtin, adding that the United States could upgrade software at British bases to track missiles.

The United Kingdom has already given permission to the United States to install a space-based infrared system ground relay station at Menwith Hill to observe missile launches around the world, the officials said.

“If the U.S. wanted to use this for missile defense purposes, it would need to request approval,” Hawtin said.

British officials are discussing the potential consequences of assisting the United States, the defense officials said.  Involvement in the system could cost the United Kingdom between 5 billion and 10 billion pounds, they said.

Some officials expressed skepticism about the need for a missile defense system, saying that terrorists would probably not use missiles.

“It is not a terrorist priority to acquire ballistic missiles as much as weapons of mass destruction,” said Marcus Fitzgerald, Defense Ministry nuclear policy director (Richard Norton-Taylor, London Guardian, Feb. 28).

Canada Opposes Weaponization of Space

In Canada, the government opposes the “weaponization of space” and is making that clear to the United States, which is considering a space-based missile defense system, Canadian Defense Minister Arthur Eggleton and Foreign Minister Bill Graham said yesterday (see GSN, Jan. 30).

“Canada is opposed to the weaponization of space.  Having said that, we do agree in surveillance programs, surveillance from space of Earth, surveillance of space,” Eggleton told the Canadian House of Commons.

“Canada’s position has always been against the weaponization of space, and we will maintain that position,” Graham said (Agence France-Presse, Feb. 27).

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