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US Intelligence Director Warns of Economic Crisis Effects on Global Political Stability

The U.S. director of national intelligence says the global economic crisis could lead to political instability around the world. Dennis Blair told the U.S. House of Representatives Intelligence Committee Wednesday that financial instability can "loosen the fragile hold that many developing nations have on law and order." Blair also cited U.S. concerns about terrorism and the spread of nuclear materials.

The global financial crisis could affect more than just the economies of many nations.

U.S. Intelligence chief Dennis Blair told lawmakers the recession is likely to cause political instability.

"Our analysis indicates that economic crises increase the risk of regime-threatening instability if they continue for a one- or two-year period," he explained. "Instability can loosen the fragile hold that many developing countries have on law and order."

Mexico is vulnerable to a prolonged U.S. recession, he added.

And there have been anti-government demonstrations in Europe and the former Soviet bloc.

But Blair said the global recession and lower oil prices could be positive for Washington. Venezuela and the U.S. have been at odds with each other.

"With low oil prices, Venezeula will face financial constraints," he noted.

And he said Iran's president Mahmoud Ahmadinejad could have a hard time getting re-elected in June elections there.

Blair cited a recent report by U.S. intelligence agencies that calls the spread of nuclear technology a major concern.

"The time when only a few states had access to the most dangerous technologies is unfortunately long over," he said. "Often dual-use, they circulate easily in our globalized economy, as does the scientific expertise to put them together into weapons."

Blair repeated past U.S. assessments that Iran's nuclear activities are not for peaceful purposes, as Tehran claims.

"Tehran at a minimum is keeping open the option to develop deliverable nuclear weapons," he noted.

About al-Qaida, Blair said counter-terrorism efforts in Saudi Arabia, Pakistan, and Iraq have been successful against the group.

But he said the terror organization still has influence.

"Al-Qaida does remain dangerous," he added. "Yemen is re-emerging as a jihadist battleground. The capabilities of terrorist groups in East Africa will increase next year."

In Afghanistan, he said success against militants depends on Pakistan taking control of its tribal areas along their mutual border.