The top U.S. intelligence official says the financial crisis that is spanning the globe is also a security threat. The Director of National Intelligence made the observation to Congress as part of the intelligence community's annual threat assessment.
In his first public testimony as national intelligence chief, Dennis Blair cited the global financial crisis as the primary near-term security concern of the United States.
Appearing before the Senate Intelligence Committee Thursday, Blair said the longer the crisis drags on, the greater the threat it will pose to political stability.
"Economic crises increase the risk of regime-threatening instability if they are prolonged for a one- or two-year period," he said. "And instability can loosen the hold that many developing countries have on law and order, which can spill out in dangerous ways into the international community."
Blair said U.S. allies and friends may be unable to meet defense and humanitarian commitments at home and abroad because of the economic crisis. He added that it may also unleash a wave of destructive protectionist trade measures by countries under economic pressures.
The threat assessment is an annual report to Congress compiled from analytical judgments of all the U.S. intelligence agencies, particularly the CIA.
On more traditional terrorist threats, Director Blair said al-Qaida has lost significant chunks of its leadership to security operations. He said it has been squeezed in Iraq and is finding it more difficult to operate in Saudi Arabia. But he added that al-Qaida remains robust elsewhere.
"But despite these setbacks al-Qaida remains dangerous," he said. "Yemen is re-emerging as a jihadist battleground. The capability of terrorist groups in east Africa will increase in the next year. And we remain concerned about the potential for homegrown American extremists inspired by al-Qaida's militant ideology to plan attacks within the United States."
Blair cited progress in turning public opinion in the Islamic world against al-Qaida and its affiliates.
The intelligence chief said the Taliban insurgency has grown bolder in the past year, and that the Afghan government must aggressively tackle corruption and the drug trade. He added that no improvement is possible in the Afghan security situation unless Pakistan takes control of its border areas.
On Iran, Director Blair reiterated an earlier intelligence community estimate that Iran halted work on nuclear weapons design in 2003. But he added that Tehran continues to work on uranium enrichment and development of ballistic missiles. He said Tehran might still be induced to give up any future nuclear arms ambitions.
"Tehran is at a minimum keeping open the option to develop deliverable nuclear weapons," said Blair. "The halt in the recent past in some aspects of the program was primarily in response to international scrutiny and pressure. Some combination of threats - threats of intensified international scrutiny and pressures - along with opportunities for Iran to pursue its security goals - might prompt Iran to extend the halt to some nuclear weapons-related activities."
Director Blair said China and India are regaining the prominence they held 200 years ago, but they, too, are being hurt by the world economic slowdown. He said the financial crisis poses risks to Chinese political stability, and that China's leaders are taking both economic and security actions to deal with it. But Blair said Taiwan has become a substantially reduced source of friction between the U.S. and China with the election last year of Taiwanese President Ma Ying-Jeou.