Out Of The Line Of Fire

By Richard Lacayo

On the first floor of CIA headquarters in Langley, Va., below the seventh-floor office of Director George Tenet, there is a hallway lined with signed photo-graphs of all the Presidents who have served since the agency was established in 1947. The inscription from the first of them, Harry Truman, says it all: TO THE CIA, A NECESSITY TO THE PRESIDENT OF THE UNITED STATES, FROM ONE WHO KNOWS.

More than a half-century later, George W. Bush could sign a picture to the CIA with practically the same sentiment. In the world after 9/11, in which intelligence has an importance like never before, so does the CIA, and not just to the President. Nothing proved its significance like the invasion of Iraq, the first time the U.S. has gone to war largely on the basis of intelligence alone--much of it faulty, flimsy or grossly misread.

For months now the failures of U.S. intelligence have been at center stage as Congress has raked through the missteps that led to 9/11 and the misevaluation of intelligence on weapons of mass destruction (WMD) in Iraq. With Tenet and his CIA at or near the focus of every inquiry, most of Washington assumed that he would be out of a job after the election--but not before. Tenet took Washington by surprise last week. On Wednesday night, after conferring with White House chief of staff Andrew Card, he spent 45 minutes alone with Bush in the White House family quarters. What he brought to the President was his letter of resignation, effective July 11, his seventh anniversary as director.

White House officials insisted that they had no advance warning of Tenet's departure and had not pushed him out. "This was obviously not expected," said a senior Administration official. "The President was sorry to hear the news, but it was very clear that [Tenet] had made the decision." Friends say Tenet wanted to leave months ago but opted to wait until the 9/11 commission and the Senate Intelligence Committee looking into prewar intelligence had ended hearings. "I was the guy who was here for it all," he told them. "I thought it was my responsibility [to stay]."

In a tearful farewell address at CIA headquarters the next day, Tenet said the only reason he was leaving was to spend more time with his family. But no one was unaware of the reports from those two panels, both coming in the next few months, that are expected to skewer Tenet and the CIA. "Scathing" is how Senator Evan Bayh of Indiana, a member of the intelligence committee, describes its still classified draft report, although he refused to give any details. "It's going to say there were some real lapses."

It's not just the reports. For a while, the knives have been out for Tenet on all sides. Within the Bush Administration, Defense Department hawks have been insisting for years that the CIA was making timid evaluations of evidence about Saddam Hussein's weapons capability or possible ties to al-Qaeda. On the other side, critics of the war say Tenet did not resist strongly enough the alleged pressure to provide the White House with pretexts it needed for an invasion of Iraq that it had already decided upon. It all came to a head in April with the publication of Bob Woodward's book Plan of Attack, which includes a scene in which Tenet lays out for the President the evidence that Saddam possessed chemical and biological weapons. "George, how confident are you?" Bush asked Tenet. "Don't worry," he answered. "It's a slam dunk."

More than a year--but no WMDs--later, those words have returned to slam-dunk Tenet. It doesn't help that the controversies over Iraq and 9/11 follow on intelligence failures stretching back almost to the beginning of Tenet's reign. In his seven years as director of Central Intelligence--only the legendary Allen Dulles served longer--Tenet revived morale at an agency devastated by post--cold war budget cuts and a sharp drop in recruitment. But he also presided over blunders that included the agency's failure to foresee in 1998 that India would test an atomic device, and the mistaken identification one year later of the Chinese embassy in Belgrade as a bombing target, an error that resulted in the deaths of three embassy staff members. The CIA also failed to foresee al-Qaeda's dual bombing in 1998 of the U.S. embassies in Tanzania and Kenya or its attack on the U.S.S. Cole two years later.

Once Tenet steps down, his acting successor will be Deputy Director of Intelligence John McLaughlin, a career analyst. It is a cliche to call McLaughlin unassuming and modest; it is more telling to describe him as deeply analytical and alert to the ambiguities of his trade. An amateur magician, he is especially adept at sleight of hand, a skill that helped win him the nickname "Merlin."

McLaughlin may need his magic powers, for one of his first challenges will be to defend the agency against attempts by the Pentagon, which already controls 90% of the roughly $40 billion the U.S. spends on intelligence annually, to take over more responsibility for gathering and analyzing intelligence. But Tenet's departure may set the stage for much larger changes. The 9/11 commission report, due out on July 26, is expected to call for the creation of a new Cabinet-level chief who would consolidate control over all the nation's disparate intelligence operations--an idea supported by Bush's rival for the White House, John Kerry, but opposed by both Tenet and Defense Secretary Donald Rumsfeld.

In intelligence circles the betting is that Bush will avoid tackling a contentious restructuring during an election year. But the Pentagon, CIA and FBI are positioning themselves to hold onto as much turf as they can in whatever reorganization may come after November. Toward that end, Rumsfeld named Stephen Cambone last year to the newly created post of Under Secretary of Defense for Intelligence. And on the same day that Bush announced Tenet's resignation, FBI Director Robert Mueller announced the creation of a directorate of intelligence within the bureau to better co-ordinate its intelligence activities.

That Tenet survived in his job so long is testimony to his combination of people skills and peerless political instincts. The son of Greek immigrants who owned a diner in Queens, N.Y., Tenet is a gruff, backslapping master of Washington, a man famously prone to chew an unlit cigar in meetings and schmooze with underlings at headquarters. Adept at defusing tense moments with a wisecrack, he knows how to keep both his employees and his bosses happy.

And that's what he did with his boss in the White House. From their earliest encounters, Tenet and Bush hit it off. Bush liked Tenet's unpretentious style and his gift for breaking down complex matters into digestible morsels of information. And while Tenet had difficulty getting face time with President Clinton, he presented Bush with an early-morning security briefing daily.

But Bush and Tenet also reinforced each other's shortcomings: Tenet, the overeager underling, played into Bush's need for clarity. Before going to the CIA as deputy director in 1995, Tenet had been head staff member of the same Senate Intelligence Committee that is about to issue that blistering report on his skills. There he became a specialist in two things: arms negotiations and the importance of pleasing his powerful superiors. Meanwhile, Bush, new to the complex world of intelligence, where there are always gambles but rarely unqualified answers, looked to Tenet as a guide.

It was President Clinton who brought Tenet to the CIA. When Tenet arrived, the agency was adrift. The years right after the collapse of the Soviet Union had been hard ones. With no clear adversary any longer, the CIA suffered massive budget cuts and a sharp downturn in recruitment of spies, infiltrators and informants. "When [Tenet] came in, there were literally just a handful of people being trained in clandestine service," says a senior CIA official. "Funding levels were untenable; we didn't have the support necessary for our analysts."

Tenet turned the mood around. Within the directorate of operations, which oversees human intelligence, he brought back an esprit de corps and a modicum of the adventurousness that is necessary to get useful information. "He has, through the force of his personality, boosted morale," says Steven Aftergood, a secrecy expert at the Federation of American Scientists.

At the same time, the threats the CIA faced had changed radically. The Soviet Union, its old adversary, was monolithic and dependent on conventional weaponry. Al-Qaeda was stateless and fluid, taking on expensive, high-tech American defenses with homemade devices and fanaticism. When it came to counting missile silos in Siberia, the CIA was first rate. It was far less adept at getting inside the operations, let alone the minds, of poor, isolated religious zealots around the world.

Tenet saw the danger of transnational terrorism earlier than most and established operations in Afghanistan and around the world that would make possible the post-9/11 success against al-Qaeda. In the hours after the attack, Tenet created key elements of the novel and successful plan that married CIA officers and agents on the ground in Afghanistan with special-forces soldiers and the Northern Alliance. "There's no question the CIA, as a result of prior experience there, brought a lot of knowledge not just to me, but to the whole war council early on," said Bush in late 2001 in an interview with TIME. "They were very impressive: impressive in their briefing; impressive in their knowledge."

All the same, things changed with the CIA's handling of prewar intelligence in Iraq. At the time, Tenet was constantly defending his agency against attacks by Defense Department hawks like Douglas Feith, a Pentagon under secretary who established a small operation that re-examined intelligence reports, some of them from the now discredited Iraqi exile leader Ahmad Chalabi, a Pentagon favorite whom the CIA deeply distrusted. Feith's purpose was to look more aggressively for any sign of links between Saddam and al-Qaeda.

That was a connection that Tenet never ceased to doubt. He was stunned to discover later that without his knowledge, Feith's group had briefed senior aides in the National Security Council and Vice President Dick Cheney's office, all the while disparaging the quality of CIA intelligence and analysis. But when it came to WMD, Tenet felt comfortable offering assessments to Bush that were more incriminating for Saddam. (So comfortable that before the war Tenet even made a closed-door appearance before the Senate Intelligence Committee in which he was asked if he would stake his life on the existence of WMD in Iraq. According to a U.S. official familiar with the matter, he said he would.) It was the CIA that provided the information that two trailers found in Iraq were probably mobile biological-weapons laboratories and that aluminum tubes discovered there were likely to have been centrifuges for enriching uranium. Both claims found their way into Colin Powell's February 2003 presentation before the United Nations of the intelligence case against Iraq. One year later, in a speech at Georgetown University, Tenet admitted to doubts on both claims.

When Powell was asked by Bush to make the case for war at the U.N., he insisted that Tenet sit directly behind him there so that the CIA's credibility was visibly on the line. After the first phase of the war ended and it became clear that weapons inspectors might come up empty handed, Powell blamed Tenet personally for providing him with exaggerated assessments. By that time, Powell had also witnessed the debacle surrounding the claims that Iraq had sought to buy uranium from Niger, an assertion that made it into Bush's State of the Union address in January 2003. By June it was plain that the claim was based on intelligence that the CIA should have known was highly suspect. On June 7, National Security Adviser Condoleezza Rice asked Powell to make appearances on the Sunday-morning talk shows defending the CIA. During a conference call with more than half a dozen Administration officials, he refused. "I'm not gonna do it," said Powell, according to a source who was in on the call. "I don't trust the information coming out of the agency."

The next morning, Rice went on the shows and claimed that while some junior CIA officers may have been concerned about the validity of the uranium allegations, they never informed anyone in the White House. What followed were days in which the CIA and Rice's office were engaged in a finger-pointing exercise about who should have scrubbed the line from the President's speech before he gave it. Eventually, Deputy National Security Adviser Stephen Hadley had to acknowledge that the CIA had sent him memos outlining the agency's concerns about the uranium claim.

But at the news of Tenet's resignation last week, Rice showed no sign of old rancor. "It's really a great loss," she said Thursday aboard Air Force One. "I'm personally very sad because this has been a great team and it's worked through a lot of really hard issues." The hardest issue may be the one still to come--how to form an intelligence system that can extract high-quality information and analyze it without bowing to anyone's preconceptions. "If any future President asks my advice," Bush told TIME three years ago, "my advice is get to know your CIA director and make sure the CIA director is an integral part of a national security team." For a while Bush certainly did that with Tenet. Whether he did it in a way that served the national interest is another question.

--Reported by Timothy J. Burger, Massimo Calabresi, James Carney, John F. Dickerson, Elaine Shannon and Mark Thompson/Washington

With reporting by Timothy J. Burger, Massimo Calabresi, James Carney, John F. Dickerson, Elaine Shannon and Mark Thompson/Washington