SEN. HATCH: (Raps gavel.) We're convened this morning to examine US counterterrorism policy in the wake of the despicable attacks on our embassies in Kenya and Tanzania.

     At the outset, let me just say how much I commend the FBI director, Louis Freeh, and his agency for their outstanding work, and I might say, the entire FBI in this matter, in responding to the bombings in Africa. The swift and capable work of the FBI, and the CIA I might add, and in some respects the diplomatic corps, all in partnership, and I might add, the foreign governments, all in partnership, in investigating these crimes and beginning the process of bringing the perpetrators to justice, sends an unmistakable message that terrorism will not go unpunished.

     I believe that it is long past due for us to demonstrate our resolve in dealing with terrorist elements. I have publicly supported the president's decision to attack the chemical weapons production facility in Khartoum and the terrorist training camps in Afghanistan. And I a reasonably assured that those strikes in Khartoum as well as Afghanistan were reasonable choices. And I can say that from being a member of the Senate Select Committee on Intelligence.

     The president deserves our support in taking those actions. Friends and foes alike must know that the United States stands united in facing down the scourge of international terrorism. And I am committed to providing the resources and the tools that are necessary to respond to the threat or threats of terrorism. And when acts of terrorism are committed, I'm committed to bringing swiftly these perpetrators to justice.

     More than two years after Congress enacted the most comprehensive antiterrorism legislation in our history, however, it is appropriate for us to review whether our national counterterrorism policy is effective. In short, is the administration effectively using all of the tools at its disposal, including those provided by Congress to disrupt foreign terrorist organizations, punish those nations supporting terrorists, and in cutting off funding to these various groups? Are these tools effective? Do we need additional legislation to address international terrorism?

     As the author of that bill, along with others on this committee, I'm very concerned about the answers to those questions.

     I must say that one aspect of the president's recent antiterrorism policy does cause me some great concern. On May 22, 1998, the president issued presidential decision directive PDD 62, which made numerous adjustments to the roles and functions of various executive branch departments and agencies relative to the prevention and deterrence of terrorist acts, the management of terrorist threats, and the investigation and management of the consequences of a successful terrorist act.

     It is my understanding that PDD 62 shifts responsibility for significant functions, including primary responsibility for federal counterterrorism special event security planning, preparation and implementation, from the FBI to other federal agencies, including the Secret Service. Although it has been suggested that PDD 62 only has each agency doing what it is already does best, I believe that there remain questions about this directive. I am a supporter of the Secret

     Service and an admirer of Director Maletti (sp). But I question whether the reassignment of responsibility for the counterterrorism mission is a wise step to take at this time.

     Additionally, I continue to have concerns that collectively we are not engaging in the kind of comprehensive sustained effort against terrorism that is needed. In order to fight this war, we need to have an adequate assessment of the magnitude of the anticipated threat from the international terrorist to US interests, persons and property, both at home and abroad. We need to determine the composition of the major terrorist organizations and their leadership.

     Additionally, it is crucial that we maximize the development of information relating to their sources of financial and logistical support, the nature and scope of their human and technical infrastructure, the quality and type of their education and training, their level of advancement and their linkages with state and non-state actors such as ethnic groups, religious communities or criminal organizations, and their intent or capabilities to access and use weapons of mass destruction, which increasingly seems to be a matter of great concern.

     Without an adequate assessment of the threat, it is impossible to have a functioning strategy to counter that threat.

     Now, all of these questions deserve this committee's concerned attention. I want to commend especially Senator Kyl, who also serves with me on the Intelligence Committee, but who is chairman of the Subcommittee on Technology, Terrorism and Government Information, for his focused and able work on this issue. He organized this hearing and should be commended for his leadership.

     We are pleased to have with us today three distinguished witnesses. On the first panel is the director of the FBI, Louis Freeh. We welcome you here and we appreciate the work that you're doing, the work you have done, the successes that you've had. And we're counting on you and your agency as lead people to protect Americans not only at home but abroad. And I know you take that seriously and you're doing a great job.

     On the second panel is former director of Central Intelligence James Woolsey and the former ambassador to the United Nations, Dr. Jeane Kirkpatrick, both of whom have had extensive experience in national security affairs.

     Mr. Woolsey held key posts during the negotiations of the US-Soviet strategic arms reduction talks, nuclear and space arms talks and conventional armed forces in Europe in Salt I. Dr. Kirkpatrick served for more than four years as our United States representative to the United Nations as well as a member of the Cabinet and the National Security Council of Ronald Reagan, the first woman to ever serve in that office. She also served as a member of the president's Foreign Intelligence Advisory Board for five years and the Defense Policy Review Board for eight years. Dr. Kirkpatrick, as we all know, has authored numerous books on public policy and is currently the professor of government at Georgetown University and senior fellow at the American Enterprise Institute.

     We are very happy to have all of these wonderful experts and servants of the people here with us today. And we feel very gratified to have them all here. And we welcome you all.

     We'll turn now to the ranking member, Senator Leahy.

     SEN. PATRICK LEAHY (D-VT): Thank you, Mr. Chairman.

     And I would also, at the appropriate place in the record, put in a statement by the senator from Wisconsin, Mr. Feingold.

     The bombings of our embassies in Kenya and Tanzania, unfortunately the most recent reminders of how vulnerable we are to terrorist attacks. And we know as a worldwide power we are vulnerable. It might be an embassy one day, it could be a corporate headquarters that represents a very recognizable American company the next. But in a shockingly brutal attack -- speaking of the two embassies -- more than 250 men, women and children were murdered in cold blood -- 250. And among those 250 victims, of course, were 12 of our fellow citizens. And we have to mourn for them and our hearts go out to their families and their loved ones here and abroad.

     And none of us certainly here can forget that only a few weeks ago that there was an assault right here in the Capitol.

     And so we pay a terrible price for being the most powerful democracy in the world, because it does make us a prime target for those who disagree with our policies. We want to keep the Capitol building and this Senate office building open to the public so that people can freely come in and see how we're doing the job they sent us here to do. And for the same reason we have to keep our embassies open so that they can be examples of the freedom that the United States offers and not appear to be closed fortresses set in some kind of a hostile territory.

     The president responded to the terrorist bombing with a prompt, sharp blow against the terrorists and their facilities, as I believe he should. And the FBI responded with another prompt, sharp blow, the identification, arrest of persons suspected to be involved in the bombings.

     I hope we never start to take the truly outstanding work of our federal law enforcement agents for granted. And, Director Freeh, I must tell you I was overjoyed when you called me in Vermont to brief me on what had happened to tell me that these terrorists were -- two arrests had been made and they were coming back, because it is that kind of rapid response we need to do. And I hope you will pass on my warm congratulations and thanks to the agents in the field who broke that case, because as you discussed with me on the phone, this was not 9 to 5 work by any means; they worked around the clock and did an outstanding job.

     And it's taken time and effort to put in place. I think that a lot of it is due to the critical work of the legal attaches the FBI has in place around the world. They developed the kind of cop-to-cop relationships that help cut through red tape and bureaucracy. And sometimes red tape and bureaucracy can slow down in time of crisis instead of speeding up, and that's when you need the quick reaction. The investigatory successes in this case show the legal attaches are helping to develop the cooperative relationships with law enforcement agencies abroad. It's that kind of relationship that we need if we're going to fight terrorism.

     And President Clinton acted precisely as an American president should act and must act. We have to protect and preserve American strength and credibility. We cannot tolerate the murder of American citizens or representatives of the United States government.

     END OF SEGMENT tape 1sj they developed a kind of cop-to-cop relationship to help cut through red tape and bureaucracy. And sometimes red tape and bureaucracy can slow down in time of crises instead of speeding up, and that's when you need the quick reaction. The investigatory successes in this case show the legal attaches are helping to develop the cooperative relationships with law enforcement agencies abroad. It's that kind of relationship that we need if we are going to fight terrorism.

     And President Clinton acted precisely as an American president should act and must act. We have to protect and preserve American strength and credibility. We cannot tolerate the murder of American citizens or representatives of the United States government. We are not going to have to worry really today of an army marching into the United States -- we're far too powerful. The threat we face is always going to be a well organized, equipped, trained, motivated and financed terrorist group. But that doesn't mean that we have to just stand there and let them hit at us.

     We can expect further acts of terror. We do remain a target. The witnesses today should be able to give us valuable information -- what we can expect and how we can prepare. They can give us the benefit of their advice to what the Congress can do to assist the president and the FBI and our armed forces in preparing for and responding to terrorism. We need to know whether our law enforcement and other agencies have the necessary resources to carry it out.

     This is not a fight of one day or one week or one year. Ten years ago, in May of 1988, as chairman of the then Judiciary Committee Subcommittee on Technology and the Law, I convened hearings on high- tech terrorism, including terrorism with chemical and biological weapons and terrorist attacks on computer infrastructure. Mr. Woolsey was one of the witnesses then, and we are helped by his wise counsel then; I believe we will be helped by it today. We made progress in those 10 years. We need to do more.

     One example: Last year the Senate gave its advice and consent to ratification of the Chemical Weapons Convention, which had been initiated by President Reagan, negotiated by President Bush, and signed by President Clinton. And we passed implementing legislation which addressed complex technical and constitutional issues about which there is great potential for delay. We overcame that delay. The chairman and I joined forces on the floor. We -- this bill was referred to this committee I believe on April 17th, 1997. We had hearings. We passed the Senate on May 23rd of 1997. Senators on both sides of the aisle joined on that. Unfortunately the implementing legislation remains stalled in the House, and I wish that they would act as we act.

     The House inaction is a very bad thing. There is very little time remaining in this session. They ought to do what we did here. They ought to have the same sense of urgency and determination, because a threat posed by terrorism and the means available to counter terrorists are technically sensitive subjects. They have got to be approached cautiously in this hearing. But I think the American people deserve to have the hearing you're having, and I congratulate you, Mr. Chairman, I congratulate Senator Kyl and those others who have worked together to put this hearing on.

     SEN. HATCH: Well, thank you, senator.

     We are going to turn to the director of the FBI now, and we look forward to hearing from you and whatever statement you care to make. And there will be no time constraints at all.

     DIR. FREEH: Okay, thank you, Mr. Chairman, Senator Leahy, and all the members of this committee. Let me just begin by thanking you and the Congress for the support -- really overwhelming support certainly since I've been the director for the FBI, but particularly for the counterterrorism program. Senator Kyl and Senator Feinstein here, and many others particularly charged with that responsibility of overseeing the operations, but also promptly and comprehensively supporting those things which need to be done to defend this country, not just within our borders, but now all over the world.

     I thought what I would do in a few minutes is sketch three areas of concern for us, and certainly for the Congress and the country. One would be to discuss briefly the threat posed by international terrorists, as it is appearing to us around the world, and the different dimensions that it will begin to take. I'd also like to talk about the response to international terrorism, particularly from a law enforcement point of view. And, third, I'd like to talk about some of the aspects of the government's counterterrorism efforts which could be improved and enhanced, which we have discussed before, but I'll put them in the context particularly of the other two subjects that I'll mention.

     The threat of international terrorism directed at American nationals and U.S. interests has followed a fairly identifiable pattern in several years past. Although the number of attacks against Americans overseas has decreased, the number of casualties has increased greatly, as has the scope and the targeting with respect to incidents that we detect and have been the victim of where large-scale acts of destruction and terror, with a clear objective to terrorize both the United States' interests, as well as the other national interests that support our efforts overseas.

     If we start with the World Trade tower back in February of 1993, the Khobar attack in the summer of 1996, and of course the recent embassy bombings which you both mentioned, we see an escalated effort to attack larger targets with the intent to inflict maximum loss of life and of course the purposes of terrorist attacks.

     I remember when I was sitting in court as a federal judge in Lower Manhattan in February of 1993 when we got word of the attack against the World Trade Center. In addition to the six people killed, hundreds of people injured and millions of dollars of damage, we do recall that the intent of the people who perpetrated that attack was not just to create the explosion that occurred, but to actually topple one of the towers into the second tower with the clear intent, the admitted attempt to kill over 100,000 people. There was also an intent -- not perfected -- to include in that explosive mix chemical or biological agents, which would have had even a more permeating effect.

     Two years later we saw the sarin gas attack in the Tokyo subways demonstrating the ability of the terrorist organization to conduct a act of terrorism which included in this case the delivery of a highly lethal gas with the result of murdering 12 innocents, injuring thousands, and also putting up on the radar screen a new threat that is now something that we have particular concerns about, looking at some of the groups active today who have expressed an interest and who betray a capability to use such weapons as part of an attack.

     The November 1997 attack on the foreign tourists in Luxor, Egypt, was conducted by an Egyptian terrorist group, but a group whose spiritual leader is Sheik Rahman, who was convicted, as you know, in the New York case with respect to the plan to blow up the Lincoln Tunnel, the Empire State Building, and a plan that would have resulted in the murder of thousands of people. He was convicted in that case before he had an opportunity to conduct those operations. And that was the result of excellent work by many law enforcement agencies, particularly by the joint terrorism task force in New York City, which as you know compromises agents from multiple law enforcement agencies, including the New York Police Department. Back when I was visiting the East African countries recently, both Tanzania and Kenya, I saw at the crime scene several New York City police detectives who are members of that New York task force -- these are particular experts with respect to vehicle identification. And to see New York City police detectives combing through debris, looking to identify the vehicle, the delivery vehicles in this case, was quite a statement about the level of cooperation, and also the shared interests that these task forces regularly demonstrate.

     Secondly, let me talk a little bit more about the threat in terms of general types of origin. The first category would be state- sponsored terrorism. As you know, the United States government has declared Iran, Iraq, Syria, Sudan, Libya, Cuba and North Korea as state sponsors of terrorism. These are countries where experience in fact has shown that terrorism is actually a tool of foreign policy. And the work of those countries with respect to this policy is evident in cases that have been charged and many cases that are still being investigated.

     The second category of international terrorism includes the formalized terrorist organizations,  bout which we know very much. These are generally autonomous organizations. They are transnational both in membership and capability. They are able to carry out terrorism campaigns on an international basis. We know very well the Lebanese Hezbollah group, the Egyptian Al Gemat (sp) group, the Palestinian Hamas group -- many other groups whose supporters both inside and outside the United States are able to engage in acts of terrorism. Hezbollah remains among the most menacing of these groups, particularly with respect to its history of documented attacks against Americans. Both the 1993 truck bombing of the United States Embassy as well as the 1985 attack on the U.S. Marine barracks in Lebanon are two of the many incidents which we have documented and which still remain unsolved from a criminal justice point of view.

     The third category of international terrorism stems from the more loosely affiliated groups characterized by rogue terrorists or terrorists who have loose associations with formalized groups, as well as other state sponsors. We saw that with Ramzi Yousef, who was convicted for not just the planning of the attack on the World Trade Center but also for a plan to explode in one day 10 U.S. aircraft over the Western Pacific, convicted for both of those offenses in New York.

     Bin Laden and his group, Al Cada (ph), which is a multinational group about which we'll talk a little bit later, these are more loosely affiliated organizations than some of the ones that we have traditionally seen active. They work together. And, combined with other organizations as well as members of other organizations, on an ad hoc, case-by-case basis, this makes the identification of their infrastructure, as well as their command and control, much more difficult. And some of the regular methodologies that we use to surveil and penetrate these groups are impeded because of the looser affiliation and the more fluid nature of their operations.

     We believe that as attention focuses now, for the moment, on Osama bin Laden in the aftermath of the East African bombings, it is important to terrorists or people operating on an ad hoc basis are just one type of the threat that we've sketched out for you here this morning, but there are many, many other capable individuals, groups and associated groups who have that capability and that intent.

     With respect to the response by the United States as a government and by the FBI particularly as an agency with respect to counter- terrorism, the Congress has funded and supported, as I mentioned before, these efforts to an extraordinary degree. In 1995, for instance, we expended in the FBI approximately $118 million, with 1291 people dedicated to counter-terrorism programs.

     Today that figure is $286 million and 2646 individuals. That has given us the capability to work crime scenes in East Africa simultaneously with all the other operations that are being conducted here in the United States. And again, I want to take the opportunity to thank this committee and particularly our other committees who have funded that operation and made it possible for us to react as we have recently.

     We also are not able to accurately gauge how many potential strikes or attacks have been averted because of our capability. We know from several sources that some terrorists have been discouraged from carrying out attacks within the United States because of their fear of the prompt response which they have seen, not just in the World Trade case but in the Oklahoma bombing case and many other acts of domestic terrorism where they are sure to see an overwhelming law enforcement response by the United States. We know of particular incidents that have been foiled, obviously, by hard work and counter- terrorism preparation, not just by the FBI but many other law enforcement agencies, working in conjunction with our intelligence agencies.

     Fifteen years ago, the president designated the FBI as the lead agency for countering terrorism in the United States. The FBI's counter-terrorism program, as well as our  responsibilities, have expanded both by virtue of the resources provided, but also the statutory authority and the various statutes that Congress has passed.

  For instance, it is now a crime to murder, assault or take hostage overseas an American or to attack American interests. Since the mid-1980s, the FBI has investigated more than 350 of these extraterritorial cases. The two individuals who are charged in the East African bombings are charged under that statute, which is a fairly recent statute enacted by the Congress.

     Our investigation into the 1996 bombing of the Khobar Towers in Saudi Arabia, which killed 19 American servicemen, our investigation into the August 7, 1998 bombings of the embassies which killed 12 Americans and killed and wounded many others, are based on the legislative authority this Congress has recently provided to the FBI.

     More recently, the Anti-Terrorism and Intelligence Authorization Acts and the Anti-Terrorism and Effective Death Penalty Act of 1996 have broadened our ability to combat international terrorists. The threat of international terrorism demands continued vigilance and, Mr. Chairman, as you noted, a continued review of the authorities and the statutory powers and weapons that we have at our disposal to deal with this issue.

     We should be under no illusions that successes with respect to counter-terrorism programs call for reprisals. And if you look at the history of counter-terrorism successes as well as subsequent acts of terrorism, we know that there is a direct connection between the successes that we experience and the reprisal and reaction that we see from terrorists.