The Spying Game

Why did intelligence agencies get it so wrong over Iraq? Evidence suggests they were too willing to believe information from …

Why did intelligence agencies get it so wrong over Iraq? Evidence suggests they were too willing to believe information from unreliable sources, reports Mark Hosenball in Washington

Let's start at the beginning. If the recently published account of former US Treasury Secretary Paul O'Neill is to be believed, within days, if not hours, of taking power in January 2001, President George W. Bush and his top advisers began contemplating military action to get rid of Saddam Hussein.

The motives behind Bush's obsession with Saddam are still murky. Left-wing critics suggest that Bush, whose personal roots are in the Texas oil patch, is a front-man for corporate interests intent on getting control of a cheap source of foreign crude. The conventional wisdom in Washington is that the incoming president and his entourage, viewing themselves as heirs to the Reagan conservatives who "defeated world Communism", believed that after eight years of Clinton liberalism and decadence, it was time for Uncle Sam to reassert himself by punching a bad guy in the nose.

The US administration's initial problem was that Saddam Hussein's brutality and corruption were so well-known and well-documented that they had become a cliché. It was widely accepted that Saddam was a megalomaniac who brutally oppressed his own population and threatened his neighbours, most likely with weapons of mass destruction. Refugees and exiles came forward to testify to Saddam's reign of terror: how Iraqi citizens were picked up by his secret police and tortured at whim, or disappeared without explanation; how Saddam's sons, Uday and Qusay, ran their own rackets and gangs and raped young women for sport; how Saddam's al-Tikriti clan plundered the nation to build palaces and private zoos and stock their garages with foreign cars and their pantries with Remy Martin and Cohiba cigars. But it was hard to get the American public worked up about someone most of them saw almost as a parody dictator. The TV cartoon, South Park, even lampooned Saddam as a depraved pervert who shared a bed with Satan.

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For its first several months in office, the Bush administration left Saddam on the back-burner. (In response to O'Neill's accusations, the administration brought forward credible evidence showing that if Iraq was on the agenda from day one, it wasn't an urgent item.) The September 11th attacks in New York and Washington gave an opening to administration hawks on Iraq, who had taken over many of the Pentagon's top civilian policy posts. The Pentagon and some sympathetic White House officials bombarded US intelligence agencies with demands for evidence of Iraqi complicity in the attacks. Officials who were around at the time say the historical evidence at best demonstrated sporadic contacts between Saddam's regime and Osama bin Laden's al-Qaeda terrorist network, which instantly became the principal suspect for the September 11th attacks. But the CIA and other US agencies believed these contacts were more a case of two forces eyeing each other warily than of a sinister alliance. The intelligence professionals concluded that there was no significant evidence of co-operation between Saddam and bin Laden before September 11th.

But a few weeks after the attacks, the anti-Saddam faction of the administration was blessed with an apparent intelligence bonanza. An informant for the Czech Republic's Special Branch claimed to his handlers that he had observed Mohammed Atta, the chief September 11th hijacker, meeting in early April 2001 with a widely known Iraqi spook based at Iraq's embassy in Prague. The informant claimed that Atta and the Iraqi were discussing a terror attack on a US facility in Prague. How he knew this was unclear; there were no photographs or electronic recordings of the alleged meeting.

According to US intelligence officials, the Czech informant subsequently acknowledged that he only recognised Atta after seeing his picture, post- September 11th, on television. The FBI later found records indicating that Atta was almost certainly in the US a few days before and a few days after the alleged Prague meeting occurred, and that there was no evidence he had travelled outside the US at the time. The FBI and CIA subsequently concluded that the alleged meeting between Atta and the Iraqi spymaster never occurred, and told this to US policy-makers and the media.

Instead of accepting this verdict, however, two of the US Defense Department's senior policy officials, hardliners Paul Wolfowitz and Douglas Feith, authorised the establishment of a small Pentagon team to go through raw intelligence information from the CIA and other agencies for clues about Iraqi involvement in September 11th and other terror attacks that CIA analysts might have missed.

Years earlier, Wolfowitz and other influential administration conservatives had served on committees investigating earlier intelligence failures - including alleged underestimates of Soviet nuclear strength and North Korean missile developments. They did not trust the CIA, or even many of the Pentagon's own intelligence units, which they regarded as politically correct and liberal-infested after eight years of Clinton misrule.

THE PENTAGON'S special Iraq intelligence unit had no formal name and initially comprised only two analysts, one of whom, conservative scholar David Wurmser, had in l999 published a book called Tyranny's Ally: America's Failure to Defeat Saddam Hussein. (Last year, Wurmser joined Vice-President Cheney's staff as a Middle East adviser). According to people familiar with the secret unit's activities, the CIA and other agencies initially refused to hand over their raw intelligence reports to the Pentagon analysts, and only agreed to do so after interventions by Wolfowitz.

When the CIA data arrived, the secret unit - which eventually doubled in size - pawed through it and came up with an elaborate theory alleging that the September 11th attacks were a joint operation masterminded by a partnership of bin Laden's al-Qaeda organisation and the Lebanese Shiite militia, Hizbollah. Numerous rogue governments, from Saddam's Iraq to the Islamic Republic of Iran, had, the unit claimed, lent financial or logistical support

to the plot.

Even though

the CIA and FBI had discredited it, the Pentagon analysts also gave great weight to the allegation that Mohammed Atta had met an Iraqi spy in Prague a few months before the attacks.

The Pentagon team packaged its analysis into a top-secret slide-show and oral briefing, which was presented to Pentagon officials, and later officials at other agencies, including the vice-president's office. Administration hardliners apparently found the briefing riveting: Vice-President Cheney continued to cite cryptic references from it as recently as a TV interview last September. When the slide-show was presented at the CIA, however, director George Tenet walked out in the middle. He wasn't angry; he simply had other more pressing business, a senior intelligence official claimed.

Given the insistence of the CIA and FBI that Atta's Prague meeting never occurred and that evidence of Iraqi involvement in September 11th was otherwise non-existent, the issue of Saddam's connections to terrorism was of little public interest. When administration officials attempted to raise the issue in statements to the media or briefings to Congress, they were batted down by leaks from the CIA and FBI pouring cold water on the story.

But enterprising Iraqi exile groups, one with close ties to the Pentagon and another with links to the CIA and Britain's MI6, soon offered Washington hardliners a new red flag to wave at Saddam. This was the amplification of allegations that the Iraqi leader was intent on assembling a vast arsenal of weapons of mass destruction (WMD).

Even critics of the Bush administration's handling of intelligence on Iraq acknowledge that pre-war estimates by the CIA and other US agencies that the Iraqis were likely to have stockpiles - perhaps even huge stockpiles - of chemical and biological agents were widely accepted throughout the US government and by prominent US allies, including the British and Germans. The hardest evidence that US and other Western intelligence agencies relied on for this assessment was a series of calculations by the United Nations inspectors who roamed Iraq for years until Saddam forced them out in l998. In a l999 report, the inspectors reported that, over the years, Iraq had produced, or had made preparations to produce, large quantities of chemical and biological weapons.

UN officials say that, particularly after the defection to Jordan of Hussein Kamel, the Saddam son-in-law who was in charge of Iraq's unconventional weapons programmes, Iraqi government officials began to insist that WMD stockpiles and production lines had been destroyed. But UN inspectors analysed documentation and other evidence gathered in Iraq and concluded that the Iraqis could only prove they had destroyed a small proportion of the WMD agents that the UN estimated they had manufactured. Also, the inspectors reported that the Iraqis continued to be protective of certain sites, suggesting they still had something to hide.

While they were on the ground, UN inspectors had been among the CIA's most valuable sources of intelligence about what was going on in Iraq. Some UN officials believe the CIA and other intelligence agencies had even infiltrated the international inspection force. But after the inspectors' departure in l998, the flow to US intelligence of high-grade information about weapons was curtailed. US intelligence-collection efforts were degraded further when Saddam installed a high-tech fibre-optic cable system from China to carry his sensitive communications; the US eavesdropping take dwindled precipitously.

In December 2001, with the US still shell-shocked from September 11th and the rumours about Mohammed Atta's Prague meeting at their height, the hardliners' efforts to focus attention on Saddam got a boost when the New York Times published what seemed to be an alarming series of revelations about Saddam's drive to acquire unconventional weapons. In the story, an Iraqi defector claimed that Iraqi WMD facilities were hidden under government buildings and the Saddam Hussein Hospital in Baghdad. He claimed to have repaired nuclear weapons facilities.

THE DEFECTOR was made available to the newspaper by the Iraqi National Congress (INC), a London-based exile group headed by the controversial Ahmed Chalabi, a failed banker who fled fraud charges in Jordan (which he claimed were trumped up by Saddam), worked for years with the CIA, and then fell out with the US spy agency over a botched putsch attempt against Saddam in the mid-1990s. Chalabi proceeded to cultivate friendships with influential figures from the Reagan era such as Wolfowitz and former Pentagon official Richard Perle. His Washington admirers organised a campaign to win him overt financial backing from Congress. Eventually, the State Department was ordered to finance several INC programmes, including an "Information Collection Program" which included the recruitment and debriefing of Iraqi defectors.

After the INC defector's story was published in the New York Times, the defector was snapped up by the CIA and the Defense Intelligence Agency (DIA) and put in a witness protection programme. More stories from INC defectors, focusing either on lurid new tales of Saddam's unconventional weapons or on innuendo linking Iraq to September 11th, began to surface in other influential media, including Vanity Fair, the Observer and the US TV networks. The INC, meanwhile, was in contact with high-level Bush administration hardliners. A memo sent by the exile group to Congress in June 2002 bragged that among the recipients of the "results" of intelligence gathered from "defectors, reports and raw intelligence" were top aides to Vice-President Cheney and Pentagon policy chief Douglas Feith.

Cheney's office and the Pentagon deny ever receiving raw information from Chalabi or the INC. They maintain that any defectors presented to the US government by Chalabi were sent to orthodox intelligence agencies for evaluation.

Whether or not the defectors' information went through orthodox channels, official sources say evidence is mounting that the CIA and DIA began to pay attention to the stories told by defectors and another rival exile group, the Iraqi National Accord (INC), which was close to the CIA and MI6.

The departing CIA weapons inspection chief, David Kay, now says that information from defectors from both groups made it into WMD estimates on Iraq sent to Bush administration policy-makers. Officials familiar with the views of the CIA and DIA now say that only one defector supplied by Chalabi's group - the first, whose story was in the New York Times - was ever accepted by US intelligence and all subsequent defectors are regarded as useless or worse.

IN AN OBLIQUE reference to the role dubious defectors may have played in filling in a US intelligence picture of Saddam's WMD that otherwise would have been sketchy, CIA director George Tenet, in a little-noticed reference in his widely covered speech last week, noted that his agency had only "recently discovered" that some of his analysts had apparently overlooked an internal notice labelling one particular source "unreliable" and a sometime fabricator. According to a senior American official, the individual in question, whose information about alleged Iraqi mobile biological weapons laboratories made it into Colin Powell's influential speech to the UN, was a defector supplied by Chalabi's INC.

The CIA director claimed it was still possible WMD would be found in Iraq, though he also denied that the CIA had ever declared that the threat to the world posed by Saddam was "imminent."

The evidence suggests that the apparently gross over-estimation of Saddam's WMD capacities by the CIA (and their friends at MI6) was the product of a confluence of circumstances rather than any conspiracy, either by the CIA itself, or by a secret cabal of Pentagon and White House hardliners. The CIA vehemently denies that it was pressured by politicians or that it voluntarily hyped its findings to curry political favour.

One irony of this story is that if US and British intelligence had paid more attention to the cartoonish aspect of Saddam's regime, their estimates might have been closer to the mark. David Kay says he now believes Iraqi scientists are telling the truth when they say that most of Iraq's WMD capability was destroyed during the first round of UN inspections and that the Iraqis themselves burned or buried all but skeletal remains of the rest after Hussein Kamel's defection.

For at least three years, Kay says, Saddam's regime, including his vaunted military establishment, had been decaying. Saddam had grown increasingly distant, shutting himself up for weeks in his palaces to write epic novels. Obsessed with shooting down the US "stealth" jets that were buzzing his airspace, he ordered huge investment in designs for shooting them down. Many of these projects existed only on paper or in the imaginations of the henchmen who dreamed them up. Some of these pocketed the billions in illicit oil revenues that Saddam ploughed into their research.

Saddam went ahead with an illegal missile programme - the only major illegal programme US and UN inspectors have been able to find - because he was under a delusion about what was legal. He thought UN resolutions allowed him to build long-range missiles so long as they were not equipped with unconventional warheads. All of his advisers knew that this was a complete misreading of UN orders but nobody dared to tell Saddam, captured Iraqi officials told David Kay.

Saddam's corruption and depravity were among the most clichéd elements of his pre-war persona. US intelligence undoubtedly knew as much - and hopefully more - about the regime's decadence than the average newspaper reader. But either the CIA and MI6 had been unaware of how deeply the rot had set in - a serious possibility, given their reliance on exiles interested in hyping Saddam's military programmes - or they did know, and either were not listened to by elected officials or never bothered to tell them.