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CNN Live Event/Special

White House Briefing

Aired August 02, 2004 - 13:01   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


KYRA PHILLIPS, CNN ANCHOR: From the CNN Center in Atlanta, hello everyone, I'm Kyra Phillips. Miles is off today.
CNN's LIVE FROM starts right now.

From spies in the field to guards at the door; Wall Street to Pennsylvania Avenue; high alert to business as usual.

This hour's top stories are all about tracking and preempting terror. If you've been watching CNN, you saw President Bush endorse the number one recommendation of the 9/11 Commission of a national director of intelligence.

Mr. Bush also is backing a national counter-terrorism center, but he doesn't want to base it in the West Wing of the White House, as the 9/11 would prefer.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I think that the new national intelligence director ought to be able to coordinate budgets. I certainly hope Congress will form this budget process, too, so that it's a seamless process.

Secondly, the national intelligence director will work with the respective agencies to set priorities. But let me make it also very clear that when it comes to operations, the chain of command will be intact when the Defense Department is conducting operations to secure the homeland -- there will be nothing in between the secretary of defense and me.

(END VIDEO CLIP)

PHILLIPS: Ten minutes ago, Bush's Democratic challenger weighed in with a withering critique.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: If the president had a sense of urgency about this director of intelligence and about the needs to strengthen America, he would call the Congress back and get the job done now. That's what we need to do. That's the urgency that exists in order to make America as safe as possible.

The terror alert yesterday just underscores that if we're being serious about this, we have to move on every possible option to make our nation as safe as possible. The time to act is now, not later. (END VIDEO CLIP)

KYRA PHILLIPS, CNN ANCHOR: Let's take you live to the White House now. Scott McClellan addressing reporters, but we are expecting to hear from national security adviser Condoleezza Rice, and White House chief of staff Andrew Card.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECY.: The second phase really involved the creation of the Department of Homeland Security and the creation of the Terrorist Threat Integration Center, so that the FBI and CIA, intelligence agencies, would be able to better share and gather intelligence information.

And today is really the third phase, where we're building upon the many reforms we've already put in place since September 11th.

And with that, I'm going to ask Secretary Card to come up here and talk about the process and the task force that was involved in looking at these recommendations.

MCCLELLAN: Go ahead.

ANDREW CARD, WHITE HOUSE CHIEF OF STAFF: Thank you very much, Scott.

The president, after he received the 9/11 Commission report -- and he received that report on the morning of the 22nd -- he did task me to put together a group we call the intelligence reform task force, and we started our work on the 23rd.

And we held meetings over the course of the last 10 days that have taken an awful lot of time. The president was involved personally in hours of meetings, two hours of meetings with the task force, two separate meetings. He also spent an awful lot of time on the phone with me and Dr. Rice and Fran Townsend, and going over the briefing papers that were written for him so he could participate in the decision-making process.

The principals of the National Security Council and the Homeland Security Council gave hours and hours of time to this effort as well. In fact, we had one three-hour meeting, and we had two one-hour meetings beyond that that included the principals, without the president, talking about the issues.

And then there was a working group of staff. And John Bellinger and David Shed (ph) spearheaded that effort for the White House. They did a phenomenal job in putting multiple hours of work during the daylight hours and during the nighttime hours to get this report ready for the president's consideration. And he embraced the recommendations that were put forward.

This does build on the many reforms that the president put in place after September 11, 2001. Let's not forget how difficult it was to be able to respond to September 11th and find that we had a bureaucracy that was diverse, not well-coordinated, and required the president to take full action under his authority to create the homeland security advisor and the Homeland Security Council.

He went to the limits of his constitutional authority to create that White House body that would force coordination among the agencies. And there were over 100 agencies involved in securing the homeland. And when the Homeland Security Council was created and the homeland security advisor was appointed, that was a meaningful step in reform.

We also moved to create the Department of Homeland Security. And once that was done, we also brought in greater coordination for our intelligence analysis through the TTIC, the Terrorist Threat Integration Center.

The recommendations of the 9/11 Commission are quite significant. There were some 41 recommendations. We looked at all of them.

Many of the recommendations deal with Congress, so they are beyond the domain of the executive branch of government. And we encourage Congress to pay attention to those recommendations and to take meaningful steps toward reform as well. They have to be partners in this process.

CARD: The president did direct that we be as forward-leaning as possible in working with the 9/11 Commission. I spent quite a bit of time on the phone with both Tom Kean and Lee Hamilton.

I've also consulted with Judge Laurence Silberman and former Senator Chuck Robb, who are running a commission to take a look at the CIA and intelligence community as it considers the weapons of mass destruction and proliferation issues.

So this was not a review that just centered around the recommendations of the 9/11 Commission. It also included some input from others who were involved in paying attention to the work of the CIA and our intelligence community.

We had tremendous cooperation from all sectors of the executive branch of government. Secretary Rumsfeld and Attorney General Ashcroft, the vice president, were all involved in almost all of our meetings. We also had tremendous support from Bob Mueller, the FBI director, and John Mclaughlin, the acting CIA director. And Tom Ridge was obviously very involved, as was the other members of the Homeland Security Council and the National Security Council.

This was a herculean effort, and the president has considered the recommendations. He thinks that he has embraced the most important recommendations to go forward with.

CARD: Dr. Rice and Ms. Townsend will be glad to respond to some of the specific suggestions that were made in the recommendations and how the president embraced them and why they are so important.

But the process was one where I was kind of a cattle prod, keeping people to the task at hand, knowing that there could have been an opportunity for a long, long debate over these issues. The president instructed me to have a consensus develop early in the process, and where no consensus could be developed, he would be glad to make tough decisions.

And he made some tough decisions. He's made decisions that are right for the country. He calls on Congress to consider the recommendations that will require their participation. Some of the changes in law would be necessary to update the 1947 law, for example, that created the CIA director and the Central Intelligence Agency.

So we have an awful lot of work to do. The president is taking bold steps through his own action to build on the great work that has been done and the many reforms that have been implemented.

I would remind you that the 9/11 Commission looked at a window of opportunity and responsibility from September 11, 2001, up to a date well before the date where the president was presented with recommendations.

So many recommendations that are included in the 9/11 Commission are recommendations that the president has been implementing through common sense and good work on the part of the administration.

So the work of the 9/11 Commission builds on a lot of the changes that the president put in place. And he will codify many of the changes over the course of the next several weeks.

We do expect to have a meaningful creation of this national counterterrorism center, where we can build on the great work that's been done by the CIA and FBI, coordinating under the new authorities granted by the Patriot Act and within the Terrorist Threat Integration Center. And that is a very, very important reform, and it's already produced tremendous results.

With that, I'd be glad to turn it over to Dr. Rice. Or, go ahead.

QUESTION: I just wondered, if you all moved with such alacrity on this, at the direction of the president, and he's laid out these recommendations, then why not call Congress back into session this summer, as Senator Kerry suggested today, and get moving on all this before September?

CARD: Congress is working. Their committees started hearings last Friday in the Senate, and I know there are many hearings scheduled for this week and next week as well. So I do think that Congress is working to consider the recommendations of the 9/11 Commission and the president's recommendations as well.

We look forward to working with members of the Senate and the House as they consider these proposals, but I do think the committee process is working.

They probably, even if they were to come back into session as full bodies next week, I doubt that the committee process would have produced a product for them to consider on the floor of the House or the floor of the Senate. The committees are working, they're holding the hearings.

I've spent quite a bit of time with Chairman Pat Roberts of the Senate Intelligence Committee, and also with Porter Goss, the chairman of the House Intelligence Committee, and other members of Congress, both involved with the Defense Department and FBI and the Justice Department.

So I know that they are working hard to understand the recommendations and to consider them in the normal legislative process, and I also know that when Congress comes back after the recess, that they'll probably be ready to consider some recommendations from the various committees.

There are huge jurisdictional challenges that must be addressed by Congress, and that is cited by the 9/11 Commission. And since we do not play a role in that, that's part of the legislative branch responsibility, we'll work closely with them and encourage them to consider the recommendations, but we can't mandate that they do so.

QUESTION: One follow-up from the other perspective, which is: Why is it wise to take all of this on in the heat of an election campaign?

CARD: Well, this has nothing to do with politics. This has to do with better protecting the homeland and making sure that the resources of our intelligence community are well-coordinated so that the president can have the best information available to defeat terrorism.

And the president took bold action when he created the homeland security adviser and the Homeland Security Council. He took bold action when he created the Department of Homeland Security. He took bold action when he created the Terrorist Threat Integration Center and called for the passage of the Patriot Act.

CARD: And this builds on that success and that's why the president is putting forward now. We think it's the right thing to do, and it's better to move quickly rather than move too slowly.

QUESTION: If the national intelligence director is not in the White House, where is it?

And what kind of clout does it have? The president said that the national intelligence director would coordinate the budget to the intelligence agencies. The commission talked about controlling.

CARD: Well, first of all, I think it's entirely appropriate that the national intelligence director and the operation that would be run by the national intelligence director would not be included in the executive office of the president at the White House.

I think that allows that to be a free-standing entity that would be similar to a Cabinet agency or an agency that could best do its work and not have the undue pressure of a White House staff or White House activity. I think that it is appropriate for that to be a stand-alone entity that would be part of the executive branch of government, where the president would have the ability to appoint that individual, subject to Senate confirmation, and that person would serve at the pleasure of the president, because the president has to be comfortable with whomever would serve in that position.

I do think that that position is very important in that it would be the primary intelligence officer for the president of the United States. And in that context, he or she should have an awful lot of input into the development of any budgets in the intelligence community.

And that is a reform that we feel is important for the executive branch. But more significantly, it's a reform that's important for the legislative branch to consider. Because even if the executive branch were to say, "This is how the budget should be developed," we know that budgets are developed in the executive branch but they're passed by the legislative branch.

And so, that is a reform that we call for Congress to consider, as the 9/11 Commission has recommended.

QUESTION: Are you saying that the national intelligence director then should, if he doesn't have absolute power to determine the budgets, that he would be the one who recommended to the president how much those budgets were?

CARD: We expect that the national intelligence director would have significant input into the development of a budget, and that it would have to be a developed budget consistent with other agencies.

We know that the Defense Department and Homeland Security Department all have budgets. They have to go through a budget process that includes the review of the Office of Management and Budget. And that should be the same for the national intelligence director.

CARD: But we do feel that the national intelligence director should have significant input, clout and responsibility for the development of a budget.

QUESTION: As you may know, the Kerry campaign is saying, look, you guys are throwing this out, that you're adopting this notion, but you're not really giving the person the power that was envisioned by the commission, and certainly not the power that the Kerry campaign has planned.

CARD: I think that the president has clearly made a decision that would allow for the national intelligence director to have an awful lot of clout, an awful lot of power. But it would require Congress to consider the president's proposal and the 9/11 Commission's proposal in order for that position to live up to the expectations that they might have or we might have.

This cannot be done solely by executive authority. It requires Congress to change the 1947 act that created the CIA, and it also requires Congress to consider the budget process under which the national intelligence director and the counterterrorism center to consider in terms of approving budgets.

CONDOLEEZZA RICE, NATL. SECURITY ADVISER: Can I just add one thing on this issue? Because the president clearly expects an integrated intelligence budget that takes account of all of the needs of the various agencies that are involved and need intelligence support.

Obviously, it's going to be important that the warfighter in the field continue to get the kind of intelligence support that the warfighter needs. It's going to be important that the Homeland Security Department gets the kind of support that it needs.

And what this person will have is an overall picture of that, in the way that we don't currently have someone with an overall picture of that.

And I would think that the recommendation of this person on the budget would strongly influence any final budget.

But, as Andy said, right now, budgetary authority is chopped up among many different jurisdictions. And so that has to be dealt with too.

The exact mechanism I think you have to work on, because you have to also work with the Congress to see what's going to be done on jurisdictional boundaries in the Congress.

QUESTION: Some members of the administration had argued against this position. How difficult was the internal debate over this?

CARD: There was a healthy debate. And the reforms that were recommended in the 9/11 Commission report are not new suggestions, for the most part.

CARD: We have had the benefit of work that was done by the President's Foreign Intelligence Advisory Board and other entities throughout the last 15 or 20 years as they took a look at intelligence.

This is the first time we had the ability to take a look at recommendations in the context of such a horrible event as September 11th, where we also had to learn the benefit of the Patriot Act that broke the wall down between international intelligence and domestic intelligence.

And we think that the recommendations of the 9/11 Commission are fruitful, and we've embraced many of them, most of them. The context of a national intelligence director is something that we feel the time has come to have that.

The president has recognized the need to have greater sharing of intelligence data. That's why he created the Terrorist Threat Integration Center. And this builds on the success of TTIC, and we're learning every day through TTIC how to make it stronger and better. And the national counterterrorism center is something that will also build on the lessons learned through TTIC.

So it's a big step.

QUESTION: Will he continue to see the CIA and the FBI directors every day, under the new circumstance?

CARD: The president certainly expects to be well-briefed on international intelligence, domestic intelligence, and intelligence that overlaps with regard to terrorist threats. And, yes...

QUESTION: ... one director?

CARD: Well, right now the president has the benefit of being briefed by representatives from the CIA, the FBI, and the Justice Department and the Homeland Security Department. And I would expect that that would...

QUESTION: In one meeting, or are they separate?

CARD: No, he usually has a meeting with all of them there.

QUESTION: Andy, you said this has nothing to do with politics. Just a couple things tied to that. First of all, when you said that this director, intelligence director, should not be under the pressure of the White House staff, you're trying to keep this position as apolitical as you can by keeping them away from the White House, is that one thing you're saying there?

CARD: No, I think that, first of all, the new director would have a relatively large staff that would include analysts and support staff.

CARD: It is not realistic that a large staff could fit into the White House complex.

So I think there is some practicality to recognizing that the national intelligence director would be obligated to have, first of all, the analysts necessary to understand the threats and connect the dots, the dots that were provided by the FBI, the Department of Homeland Security, the Department of Defense and the CIA and other entities; and that that analysis should be complementary to the analysis that will be done in each one of those agencies.

Because we're not suggesting that the CIA or the Defense Department or the Department of Homeland Security or the FBI would eliminate all ability to analyze, because we do want analysts to to be able to work with operators.

The NID would not be operational in terms of sending people out to collect information, nor to send people to respond to information that might have been analyzed. Instead, this would be a collection center that would break down the barriers between domestic and international terrorism, allow for a good view of the work of the analysis, and make sure that the president is not presented just one version of an interpretation of a potential threat, but have the benefit of understanding what different people think within our government.

And the NID would provide that. He would be the intelligence director for the country and provide counsel to the president.

But it's the president who would make the ultimate decisions. The other operators would have to carry out the recommendations that might be developed in the process.

QUESTION: Well, the reason I asked about this political influence, maybe I misunderstood you, Scott, I don't want to get you in trouble, but I thought you talked about not wanting to have undue political influence this morning.

MCCLELLAN: That's something we've talked about in the past.

If you look back at the president's remarks today, he talked about how he wanted to continue to see the best, unvarnished advice possible. And that's why he thought this structure was the best way to set it up, where you would have the national intelligence director separate from the White House itself. So I'd refer you back to those remarks. QUESTION: So you're saying the political pressure had nothing to do with this?

CARD: His context of politics is not the same politics that you're using.

MCCLELLAN: Right.

CARD: You're talking partisan politics, and he was talking a different kind of politics, from my interpretation.

QUESTION: No, no, I'm just talking about -- and I realize you're making decisions not just for this presidency, but future presidents. And given that, it seems to me you're putting this person outside the White House to make this person as independent as somebody who is nominated by a president can be. Is that fair?

CARD: He would have the same relationship to the White House and the president that the secretary of defense would have, the secretary of the Department of Homeland Security, the attorney general, the secretary of the treasury. This is person that would be nominated by the president, confirmed by the Senate and serve at the pleasure of the president.

So it is not an expectation that if you are co-located in the White House, you have disproportionate access to the president. I know that that is not the way a president like to function.

In fact, the attorney general, the secretary of state, the secretary of defense, the secretary of homeland security, all have appropriate and important access to the president. And the national intelligence director should have important, regular, consistent and important access to the president.

QUESTION: Back on the budget issue, I think the question a lot of people are going to ask is, if this person does not have absolute veto power over the budget requests of the other intelligence agencies, who is going to listen to him?

CARD: I can tell you that a lot of people listen to Josh Bolton, but they don't always take Josh Bolton's counsel. And there's still an OMB director.

And the OMB director has the responsibility, for the United States government and the executive branch of government, to put together the budget and recommend it to the president for consideration. As Cabinet members and agency heads debate their budgets, they sometimes appeal decisions recommended by the director of the Office Of Management and Budget, and the president has to make a determination which way he wants to go.

I think that the national intelligence director will have tremendous clout in developing a budget. And for the first time, a person in that position will have on overview of all of the intelligence needs of the country and how they can best be addressed across the agency and be able to make recommendations in the budget process.

But I do not think that this person should replace the budget director for the United States.

QUESTION: Why not? I'm sure this was considered. Why not give him this power, and then he would have even more power to set the agenda, wouldn't he?

CARD: I think that this person will have tremendous influence over setting the agenda. The agenda will be set by the president, and the budget will be set by the president, and that's where it should rest appropriately.

And we will send a budget to Congress for them to consider. It would be great if Congress took our budgets and always passed them as we submitted them. But we know that they have a process as well, and that's why we'd like to see them reform as we make reforms.

QUESTION: Andy, who would be responsible -- I mean, how would he be held accountable for intelligence failures, if his position is outside of the Executive Office?

CARD: Well, right now the director of the Central Intelligence Agency is outside the Executive Office of the President. And he is the primary advisor to the president on intelligence matters under the 1947 act.

And we think the national intelligence director should have primary responsibility for advising the president on intelligence. And that's why we'd like to see Congress change the law to allow that to happen. This could not be done by executive action.

The CIA director right now has the legal authority and responsibility to be the principal intelligence advisor to the president of the United States. We think that that law should be changed so that the national intelligence director would have that responsibility. QUESTION: To go back to the question of the power and authority that this post would have, the 9/11 Commission recommendation includes a line that says, the national intelligence director should approve and submit nominations to the president of the individuals who would lead the CIA, DIA, FBI and a whole host of other agencies.

Would you call on Congress to include that kind of power in this job?

And do you also want statutory authority in the law, to translate your intention that he have significant power over the budget, expressly written into the law?

CARD: We would certainly want Congress to change the law to permit the national intelligence director to have a formal role in the budget process. And, yes, he should have the dominant role outside of the president's ability to recognize what is the best budget for the United States of America as an entity.

With regard to personnel, we feel very strongly that the national intelligence director should play a role, a coordinating role in the selection of people who are going to serve in our intelligence community. But we do not want to do anything that would undermine the chain of command and the responsibilities that go with the Department of Defense, the director of the Central Intelligence Agency, the secretary of the Homeland Security Department, and the other intelligence agencies, the attorney general, for example.

CARD: So we do not feel that people should be, quote, "appointed by and working for" the national intelligence director, if they also take command from the secretary of defense, for example, or the attorney general.

So that's why we would like to see them have a coordinating role in the selection. And these are not selections, by the way. They would be recommendations to the president or recommendations to a hiring authority.

(CROSSTALK)

CARD: Condi says it's concurrence. So they would...

RICE: Not just coordinating, but concurrence.

CARD: Concurrence.

QUESTION: If the Congress decides they didn't want to go with the commission's recommendation and create a Cabinet-level position, would the White House (OFF-MIKE)?

CARD: Well, the 9/11 Commission recommended that this position be Cabinet-level in pay, but not necessarily a member of the Cabinet. In fact, when I asked both Lee Hamilton and Tom Kean about this, they said, "We never recommended that it be made a member of the Cabinet." They recommended that it be cabinet-level pay.

And that's level one pay, for people who understand how the federal government pays people.

People who work at the White House are not paid level one. We are paid at the highest level, level two. And so, they...

RICE: (OFF-MIKE)

(LAUGHTER)

RICE: (OFF-MIKE) public record.

(LAUGHTER)

CARD: $150,000 or something.

But it's my understanding that their recommendations says it should be Cabinet-level, but not necessarily a member of the Cabinet. And Lee Hamilton, in particular, was saying, no, they were not make a recommendation that this individual had to serve on the Cabinet. It was more about the level of pay.

And, by the way, there are many other examples of that in the federal government, where people have Cabinet-level pay and are not automatically members of the president's Cabinet.

QUESTION: Mr. Card and Dr. Rice, somewhere in the world terrorists are watching and listening to what we do every day, especially (inaudible) they must have got their hands on the 9/11 report and all these recommendations.

And right after Senator Kerry's speech and 9/11 report, now we have raised the threat level up to orange.

QUESTION: What Americans should get from this message from the president? Where do we live? What is our future, as far as living under the threat of terrorism?

CARD: Well, I think America is much safer today than it was on September 11th, but we're not as safe as we'd like to be.

And the reforms that are recommended by the 9/11 Commission should help us get even safer. But that will not deter the president, and the president's not going to wait for all of those reforms to be implemented. Every day he is working to make this country safer.

But we know that the enemy wants to do us harm. And we have to be right 100 percent of the time. They only have to accomplish their mission of evil once. And so, we have to be ever vigilant. And American citizens are the most vigilant, so we appreciate their help.

We also have unprecedented cooperation between the federal government and state and local governments. And that's manifesting itself in the outstanding work that was done first in Boston during the Democratic National Convention and we see now taking place in New York City and in Newark and in Washington, D.C.

So we'll be working cooperatively. And Secretary Ridge and Fran Townsend have done a great job coordinating with state and local officials about understanding the current threats, which we take very seriously, and the need for to us harden targets and to be ready to respond.

But the ultimate goal is to defeat the terrorists before they have a chance to attack us. And if we can defeat them someplace else, rather than on the shores or in the United States, so much the better.

(CROSSTALK)

CARD: The international community is very important. And we are working very closely with our allies around the world to identify terrorist cells and have better intelligence and respond to that intelligence, working in partnership. And I think we've got a great track record of doing that.

The efforts centered around our understanding of the current threat have been assisted by many of our allies. The Italians and the British, for example, have been very cooperative, as well as the Pakistanis. So we've got a good international effort to help better understand the nature of the threat and how best to prevent it from manifesting itself.

QUESTION: In the context of the current threat and the urgency mentioned by the commission, more than mentioned by the commission, it would seem that a timetable or timetables are very important. And that is, when it comes down to the name of the national intelligence director and development of the center. And you could go back and mention homeland security development there; Mr. Ridge was appointed very, very quickly.

How quickly is the administration going to act?

CARD: Well, the president has said today that he will implement many of the recommendations that he can, unilaterally, before Congress has a chance to consider them, with regard to the report that came forward on September 11th.

He has also said that he will take a look at increasing the expectations for the CIA director to be able to work with an enhanced Terrorist Threat Integration Center and the coordination of the counterterrorism strategy group. And he'll do that very quickly, in a matter of weeks.

He'll also be...

QUESTION: Are you suggesting beyond (inaudible) director, and perhaps might be named as a national?

CARD: The president today said that he would be enhancing some of the authorities that currently rest with the central intelligence director, and especially in the context of the NCTC, the National Counter-Terrorism Center.

And he would like to see that happen very quickly, so we're taking the actions within the executive branch of government to be able to do that. It'll probably take us a couple of weeks, but we're going to move very very quickly to implement many of the recommendations that the president embraced this morning.

And we'll call on Congress to consider the other recommendations that they must be part of in an expeditious but important, deliberative way. Because these are big decisions. And, as you know, this is a model that will be there for many presidents. And so, we'd like to get it right. It's important that we get it right.

And we think that the president has put forward the right kind of solution to meet the terrorist threats as we know them. And we look forward to working with Congress to have it happen quickly.

QUESTION: This is probably more directed toward Ms. Townsend.

Muhammed Meyhador Khan (ph), who was the key figure in the intelligence gathering which to led to the orange alert, was arrested on July 13th.

QUESTION: And yet, on August -- it wasn't until yesterday, August 1st, that he was revealed to the public.

Why was there the delay between his arrest and the public revelations? And did this have anything to do with the Democratic Convention?

FRAN TOWNSEND, WHITE HOUSE HOMELAND SECURITY ADVISOR: Let me start with your last point, and that is, it had absolutely nothing to do with the Democratic National Convention.

Working backwards, your question, with all due respect, presumes that you are correct, that it is that one individual whose intelligence led to the raising of the threat level.

QUESTION: I should say one of the individuals.

TOWNSEND: That's right.

And as Secretary Ridge said yesterday, the source of the intelligence was -- there were multiple reporting streams that came together in such a way to give us real, grave concern.

I'd like to step back for one second, though, and take this opportunity to say to you: The reforms that the president has already put in place prior to the commission's recommendations, since 9/11, have led to a stronger intelligence community.

The fact is, because we're fighting this war overseas in places like Pakistan and Afghanistan, and working to strengthen our relationships with those allies has led to this intelligence stream. The fact is, our military, intelligence and diplomatic efforts in that part of the world fed directly into the homeland security system.

Tom Ridge and Bob Mueller are the beneficiaries of that. They're able to then focus the homeland security effort more directly and work with state and locals so that, as we move to defensive measures, they're more targeted.

Frankly, the stream went all the way from overseas to the hands of the people that could really do something about it in this country to make the country safer.

QUESTION: The administration is saying -- this is probably directed to Dr. Rice. The administration is saying it has already acted on many of the recommendations in the report. Can you talk about, specifically, some of the recommendations about reaching out to the Muslim world and how the president has acted on those specific recommendations?

RICE: Yes, of course, because there are a number of foreign policy recommendations in the commission report as well.

And on outreach to the Muslim world, the president actually has an outreach initiative to the Muslim world, but it is probably best known to you as part of what is called the Broader Middle East Initiative, which is clearly aimed at changing the circumstances that have produced the people who flew the airplanes into those buildings on September 11th.

RICE: That includes, of course, outreach on matters of economic development, outreach on matters of trade, outreach on matters of educational development, women's programs, programs with civil society.

And I should mention that this is a place where it's not just the United States, but at the G-8, then at the E.U. summit and then at NATO, the president asked for and received the very strong support of those organizations for outreach initiatives to the Muslim world.

The G-8, for instance, adopted a kind of charter and action plan for outreach to the Muslim world that includes very strong work with civil society, very strong work with women's groups, very strong work to try to improve the economic opportunities for young people in the Middle East. And this is a project that will only grow over time.

And so it's one thing to talk about the public diplomacy part of this, and I think the president wants to look harder at what might be done on the public diplomacy side to strengthen our efforts to get the message out to the Muslim world. But there is no greater outreach to the Muslim world than to say that the future is in greater freedom and liberty for peoples of the Muslim world, that there is no conflict between Islam and democratic values.

The president went to Turkey and talked about the importance of bridging to the Muslim world.

And so, I think you would see that the entire broader Middle East Initiative, the entire strategy for the president, is to have an outreach to the Muslim world built on democratic values, built on opportunity for people in the Muslim world. And he has an action plan to achieve it, including one that has the G-8, the E.U. and NATO signed on to it.

MCCLELLAN: Last question from Jeff.

QUESTION: Thank you.

Mr. Card, what is the background of a person that you would suggest to fill this new position? Would it be an academic, former military man, somebody from Congress? What are the qualifications that you would look for in a national intelligence director?

CARD: The most important thing would be to have the confidence of the president of the United States, so that that person would be able to come to the president and speak with great candor and offer unvarnished advice and counsel, as the analysis was reviewed and presented for the president to make tough policy decisions.

So, number one, I would say with the confidence of the president of the United States.

CARD: Beyond that, I think that the president would look to have someone who has an understanding of the intelligence community and of the various entities that make up the intelligence community in the executive branch of government -- and there are many of them -- and also have an understanding of kind of the government process, the budget process and how Congress would work and how the government has to function as kind of one voice representing the president's direction for the country and his obligation.

And remember, the oath that he took is the paramount responsibility that he has -- to preserve, protect and defend the Constitution -- meaning to preserve and protect our opportunity to participate in this great land.

QUESTION: Do you have anyone in mind?

CARD: Helen! Helen! I didn't think about you.

(LAUGHTER)

MCCLELLAN: Thank you. Thank you very much.

PHILLIPS: Andrew Card, White House chief of staff there, alongside Scott McClellan, the White House press secretary, saying I was a cattle prod to come to a consensus and have less debate when it came to discussing the role of a national director of intelligence.

Right now, a lot of conversation and questions going on about working with the 9/11 Commission and all the recommendations to find a national director of intelligence right now. Also Condoleezza Rice there, national security adviser, talking about an integrated intelligence budget, where will all of the money come from, how will Congress get involved in approving what kind of power this national director of intelligence will have and how this will all be funded.

A lot of questions out there, a lot of answers still to be defined, as these reforms go forward, or at least the conversation goes forward, on how to come to reforms suggested by the 9/11 Commission. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com


Aired August 2, 2004 - 13:01   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KYRA PHILLIPS, CNN ANCHOR: From the CNN Center in Atlanta, hello everyone, I'm Kyra Phillips. Miles is off today.
CNN's LIVE FROM starts right now.

From spies in the field to guards at the door; Wall Street to Pennsylvania Avenue; high alert to business as usual.

This hour's top stories are all about tracking and preempting terror. If you've been watching CNN, you saw President Bush endorse the number one recommendation of the 9/11 Commission of a national director of intelligence.

Mr. Bush also is backing a national counter-terrorism center, but he doesn't want to base it in the West Wing of the White House, as the 9/11 would prefer.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I think that the new national intelligence director ought to be able to coordinate budgets. I certainly hope Congress will form this budget process, too, so that it's a seamless process.

Secondly, the national intelligence director will work with the respective agencies to set priorities. But let me make it also very clear that when it comes to operations, the chain of command will be intact when the Defense Department is conducting operations to secure the homeland -- there will be nothing in between the secretary of defense and me.

(END VIDEO CLIP)

PHILLIPS: Ten minutes ago, Bush's Democratic challenger weighed in with a withering critique.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: If the president had a sense of urgency about this director of intelligence and about the needs to strengthen America, he would call the Congress back and get the job done now. That's what we need to do. That's the urgency that exists in order to make America as safe as possible.

The terror alert yesterday just underscores that if we're being serious about this, we have to move on every possible option to make our nation as safe as possible. The time to act is now, not later. (END VIDEO CLIP)

KYRA PHILLIPS, CNN ANCHOR: Let's take you live to the White House now. Scott McClellan addressing reporters, but we are expecting to hear from national security adviser Condoleezza Rice, and White House chief of staff Andrew Card.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECY.: The second phase really involved the creation of the Department of Homeland Security and the creation of the Terrorist Threat Integration Center, so that the FBI and CIA, intelligence agencies, would be able to better share and gather intelligence information.

And today is really the third phase, where we're building upon the many reforms we've already put in place since September 11th.

And with that, I'm going to ask Secretary Card to come up here and talk about the process and the task force that was involved in looking at these recommendations.

MCCLELLAN: Go ahead.

ANDREW CARD, WHITE HOUSE CHIEF OF STAFF: Thank you very much, Scott.

The president, after he received the 9/11 Commission report -- and he received that report on the morning of the 22nd -- he did task me to put together a group we call the intelligence reform task force, and we started our work on the 23rd.

And we held meetings over the course of the last 10 days that have taken an awful lot of time. The president was involved personally in hours of meetings, two hours of meetings with the task force, two separate meetings. He also spent an awful lot of time on the phone with me and Dr. Rice and Fran Townsend, and going over the briefing papers that were written for him so he could participate in the decision-making process.

The principals of the National Security Council and the Homeland Security Council gave hours and hours of time to this effort as well. In fact, we had one three-hour meeting, and we had two one-hour meetings beyond that that included the principals, without the president, talking about the issues.

And then there was a working group of staff. And John Bellinger and David Shed (ph) spearheaded that effort for the White House. They did a phenomenal job in putting multiple hours of work during the daylight hours and during the nighttime hours to get this report ready for the president's consideration. And he embraced the recommendations that were put forward.

This does build on the many reforms that the president put in place after September 11, 2001. Let's not forget how difficult it was to be able to respond to September 11th and find that we had a bureaucracy that was diverse, not well-coordinated, and required the president to take full action under his authority to create the homeland security advisor and the Homeland Security Council.

He went to the limits of his constitutional authority to create that White House body that would force coordination among the agencies. And there were over 100 agencies involved in securing the homeland. And when the Homeland Security Council was created and the homeland security advisor was appointed, that was a meaningful step in reform.

We also moved to create the Department of Homeland Security. And once that was done, we also brought in greater coordination for our intelligence analysis through the TTIC, the Terrorist Threat Integration Center.

The recommendations of the 9/11 Commission are quite significant. There were some 41 recommendations. We looked at all of them.

Many of the recommendations deal with Congress, so they are beyond the domain of the executive branch of government. And we encourage Congress to pay attention to those recommendations and to take meaningful steps toward reform as well. They have to be partners in this process.

CARD: The president did direct that we be as forward-leaning as possible in working with the 9/11 Commission. I spent quite a bit of time on the phone with both Tom Kean and Lee Hamilton.

I've also consulted with Judge Laurence Silberman and former Senator Chuck Robb, who are running a commission to take a look at the CIA and intelligence community as it considers the weapons of mass destruction and proliferation issues.

So this was not a review that just centered around the recommendations of the 9/11 Commission. It also included some input from others who were involved in paying attention to the work of the CIA and our intelligence community.

We had tremendous cooperation from all sectors of the executive branch of government. Secretary Rumsfeld and Attorney General Ashcroft, the vice president, were all involved in almost all of our meetings. We also had tremendous support from Bob Mueller, the FBI director, and John Mclaughlin, the acting CIA director. And Tom Ridge was obviously very involved, as was the other members of the Homeland Security Council and the National Security Council.

This was a herculean effort, and the president has considered the recommendations. He thinks that he has embraced the most important recommendations to go forward with.

CARD: Dr. Rice and Ms. Townsend will be glad to respond to some of the specific suggestions that were made in the recommendations and how the president embraced them and why they are so important.

But the process was one where I was kind of a cattle prod, keeping people to the task at hand, knowing that there could have been an opportunity for a long, long debate over these issues. The president instructed me to have a consensus develop early in the process, and where no consensus could be developed, he would be glad to make tough decisions.

And he made some tough decisions. He's made decisions that are right for the country. He calls on Congress to consider the recommendations that will require their participation. Some of the changes in law would be necessary to update the 1947 law, for example, that created the CIA director and the Central Intelligence Agency.

So we have an awful lot of work to do. The president is taking bold steps through his own action to build on the great work that has been done and the many reforms that have been implemented.

I would remind you that the 9/11 Commission looked at a window of opportunity and responsibility from September 11, 2001, up to a date well before the date where the president was presented with recommendations.

So many recommendations that are included in the 9/11 Commission are recommendations that the president has been implementing through common sense and good work on the part of the administration.

So the work of the 9/11 Commission builds on a lot of the changes that the president put in place. And he will codify many of the changes over the course of the next several weeks.

We do expect to have a meaningful creation of this national counterterrorism center, where we can build on the great work that's been done by the CIA and FBI, coordinating under the new authorities granted by the Patriot Act and within the Terrorist Threat Integration Center. And that is a very, very important reform, and it's already produced tremendous results.

With that, I'd be glad to turn it over to Dr. Rice. Or, go ahead.

QUESTION: I just wondered, if you all moved with such alacrity on this, at the direction of the president, and he's laid out these recommendations, then why not call Congress back into session this summer, as Senator Kerry suggested today, and get moving on all this before September?

CARD: Congress is working. Their committees started hearings last Friday in the Senate, and I know there are many hearings scheduled for this week and next week as well. So I do think that Congress is working to consider the recommendations of the 9/11 Commission and the president's recommendations as well.

We look forward to working with members of the Senate and the House as they consider these proposals, but I do think the committee process is working.

They probably, even if they were to come back into session as full bodies next week, I doubt that the committee process would have produced a product for them to consider on the floor of the House or the floor of the Senate. The committees are working, they're holding the hearings.

I've spent quite a bit of time with Chairman Pat Roberts of the Senate Intelligence Committee, and also with Porter Goss, the chairman of the House Intelligence Committee, and other members of Congress, both involved with the Defense Department and FBI and the Justice Department.

So I know that they are working hard to understand the recommendations and to consider them in the normal legislative process, and I also know that when Congress comes back after the recess, that they'll probably be ready to consider some recommendations from the various committees.

There are huge jurisdictional challenges that must be addressed by Congress, and that is cited by the 9/11 Commission. And since we do not play a role in that, that's part of the legislative branch responsibility, we'll work closely with them and encourage them to consider the recommendations, but we can't mandate that they do so.

QUESTION: One follow-up from the other perspective, which is: Why is it wise to take all of this on in the heat of an election campaign?

CARD: Well, this has nothing to do with politics. This has to do with better protecting the homeland and making sure that the resources of our intelligence community are well-coordinated so that the president can have the best information available to defeat terrorism.

And the president took bold action when he created the homeland security adviser and the Homeland Security Council. He took bold action when he created the Department of Homeland Security. He took bold action when he created the Terrorist Threat Integration Center and called for the passage of the Patriot Act.

CARD: And this builds on that success and that's why the president is putting forward now. We think it's the right thing to do, and it's better to move quickly rather than move too slowly.

QUESTION: If the national intelligence director is not in the White House, where is it?

And what kind of clout does it have? The president said that the national intelligence director would coordinate the budget to the intelligence agencies. The commission talked about controlling.

CARD: Well, first of all, I think it's entirely appropriate that the national intelligence director and the operation that would be run by the national intelligence director would not be included in the executive office of the president at the White House.

I think that allows that to be a free-standing entity that would be similar to a Cabinet agency or an agency that could best do its work and not have the undue pressure of a White House staff or White House activity. I think that it is appropriate for that to be a stand-alone entity that would be part of the executive branch of government, where the president would have the ability to appoint that individual, subject to Senate confirmation, and that person would serve at the pleasure of the president, because the president has to be comfortable with whomever would serve in that position.

I do think that that position is very important in that it would be the primary intelligence officer for the president of the United States. And in that context, he or she should have an awful lot of input into the development of any budgets in the intelligence community.

And that is a reform that we feel is important for the executive branch. But more significantly, it's a reform that's important for the legislative branch to consider. Because even if the executive branch were to say, "This is how the budget should be developed," we know that budgets are developed in the executive branch but they're passed by the legislative branch.

And so, that is a reform that we call for Congress to consider, as the 9/11 Commission has recommended.

QUESTION: Are you saying that the national intelligence director then should, if he doesn't have absolute power to determine the budgets, that he would be the one who recommended to the president how much those budgets were?

CARD: We expect that the national intelligence director would have significant input into the development of a budget, and that it would have to be a developed budget consistent with other agencies.

We know that the Defense Department and Homeland Security Department all have budgets. They have to go through a budget process that includes the review of the Office of Management and Budget. And that should be the same for the national intelligence director.

CARD: But we do feel that the national intelligence director should have significant input, clout and responsibility for the development of a budget.

QUESTION: As you may know, the Kerry campaign is saying, look, you guys are throwing this out, that you're adopting this notion, but you're not really giving the person the power that was envisioned by the commission, and certainly not the power that the Kerry campaign has planned.

CARD: I think that the president has clearly made a decision that would allow for the national intelligence director to have an awful lot of clout, an awful lot of power. But it would require Congress to consider the president's proposal and the 9/11 Commission's proposal in order for that position to live up to the expectations that they might have or we might have.

This cannot be done solely by executive authority. It requires Congress to change the 1947 act that created the CIA, and it also requires Congress to consider the budget process under which the national intelligence director and the counterterrorism center to consider in terms of approving budgets.

CONDOLEEZZA RICE, NATL. SECURITY ADVISER: Can I just add one thing on this issue? Because the president clearly expects an integrated intelligence budget that takes account of all of the needs of the various agencies that are involved and need intelligence support.

Obviously, it's going to be important that the warfighter in the field continue to get the kind of intelligence support that the warfighter needs. It's going to be important that the Homeland Security Department gets the kind of support that it needs.

And what this person will have is an overall picture of that, in the way that we don't currently have someone with an overall picture of that.

And I would think that the recommendation of this person on the budget would strongly influence any final budget.

But, as Andy said, right now, budgetary authority is chopped up among many different jurisdictions. And so that has to be dealt with too.

The exact mechanism I think you have to work on, because you have to also work with the Congress to see what's going to be done on jurisdictional boundaries in the Congress.

QUESTION: Some members of the administration had argued against this position. How difficult was the internal debate over this?

CARD: There was a healthy debate. And the reforms that were recommended in the 9/11 Commission report are not new suggestions, for the most part.

CARD: We have had the benefit of work that was done by the President's Foreign Intelligence Advisory Board and other entities throughout the last 15 or 20 years as they took a look at intelligence.

This is the first time we had the ability to take a look at recommendations in the context of such a horrible event as September 11th, where we also had to learn the benefit of the Patriot Act that broke the wall down between international intelligence and domestic intelligence.

And we think that the recommendations of the 9/11 Commission are fruitful, and we've embraced many of them, most of them. The context of a national intelligence director is something that we feel the time has come to have that.

The president has recognized the need to have greater sharing of intelligence data. That's why he created the Terrorist Threat Integration Center. And this builds on the success of TTIC, and we're learning every day through TTIC how to make it stronger and better. And the national counterterrorism center is something that will also build on the lessons learned through TTIC.

So it's a big step.

QUESTION: Will he continue to see the CIA and the FBI directors every day, under the new circumstance?

CARD: The president certainly expects to be well-briefed on international intelligence, domestic intelligence, and intelligence that overlaps with regard to terrorist threats. And, yes...

QUESTION: ... one director?

CARD: Well, right now the president has the benefit of being briefed by representatives from the CIA, the FBI, and the Justice Department and the Homeland Security Department. And I would expect that that would...

QUESTION: In one meeting, or are they separate?

CARD: No, he usually has a meeting with all of them there.

QUESTION: Andy, you said this has nothing to do with politics. Just a couple things tied to that. First of all, when you said that this director, intelligence director, should not be under the pressure of the White House staff, you're trying to keep this position as apolitical as you can by keeping them away from the White House, is that one thing you're saying there?

CARD: No, I think that, first of all, the new director would have a relatively large staff that would include analysts and support staff.

CARD: It is not realistic that a large staff could fit into the White House complex.

So I think there is some practicality to recognizing that the national intelligence director would be obligated to have, first of all, the analysts necessary to understand the threats and connect the dots, the dots that were provided by the FBI, the Department of Homeland Security, the Department of Defense and the CIA and other entities; and that that analysis should be complementary to the analysis that will be done in each one of those agencies.

Because we're not suggesting that the CIA or the Defense Department or the Department of Homeland Security or the FBI would eliminate all ability to analyze, because we do want analysts to to be able to work with operators.

The NID would not be operational in terms of sending people out to collect information, nor to send people to respond to information that might have been analyzed. Instead, this would be a collection center that would break down the barriers between domestic and international terrorism, allow for a good view of the work of the analysis, and make sure that the president is not presented just one version of an interpretation of a potential threat, but have the benefit of understanding what different people think within our government.

And the NID would provide that. He would be the intelligence director for the country and provide counsel to the president.

But it's the president who would make the ultimate decisions. The other operators would have to carry out the recommendations that might be developed in the process.

QUESTION: Well, the reason I asked about this political influence, maybe I misunderstood you, Scott, I don't want to get you in trouble, but I thought you talked about not wanting to have undue political influence this morning.

MCCLELLAN: That's something we've talked about in the past.

If you look back at the president's remarks today, he talked about how he wanted to continue to see the best, unvarnished advice possible. And that's why he thought this structure was the best way to set it up, where you would have the national intelligence director separate from the White House itself. So I'd refer you back to those remarks. QUESTION: So you're saying the political pressure had nothing to do with this?

CARD: His context of politics is not the same politics that you're using.

MCCLELLAN: Right.

CARD: You're talking partisan politics, and he was talking a different kind of politics, from my interpretation.

QUESTION: No, no, I'm just talking about -- and I realize you're making decisions not just for this presidency, but future presidents. And given that, it seems to me you're putting this person outside the White House to make this person as independent as somebody who is nominated by a president can be. Is that fair?

CARD: He would have the same relationship to the White House and the president that the secretary of defense would have, the secretary of the Department of Homeland Security, the attorney general, the secretary of the treasury. This is person that would be nominated by the president, confirmed by the Senate and serve at the pleasure of the president.

So it is not an expectation that if you are co-located in the White House, you have disproportionate access to the president. I know that that is not the way a president like to function.

In fact, the attorney general, the secretary of state, the secretary of defense, the secretary of homeland security, all have appropriate and important access to the president. And the national intelligence director should have important, regular, consistent and important access to the president.

QUESTION: Back on the budget issue, I think the question a lot of people are going to ask is, if this person does not have absolute veto power over the budget requests of the other intelligence agencies, who is going to listen to him?

CARD: I can tell you that a lot of people listen to Josh Bolton, but they don't always take Josh Bolton's counsel. And there's still an OMB director.

And the OMB director has the responsibility, for the United States government and the executive branch of government, to put together the budget and recommend it to the president for consideration. As Cabinet members and agency heads debate their budgets, they sometimes appeal decisions recommended by the director of the Office Of Management and Budget, and the president has to make a determination which way he wants to go.

I think that the national intelligence director will have tremendous clout in developing a budget. And for the first time, a person in that position will have on overview of all of the intelligence needs of the country and how they can best be addressed across the agency and be able to make recommendations in the budget process.

But I do not think that this person should replace the budget director for the United States.

QUESTION: Why not? I'm sure this was considered. Why not give him this power, and then he would have even more power to set the agenda, wouldn't he?

CARD: I think that this person will have tremendous influence over setting the agenda. The agenda will be set by the president, and the budget will be set by the president, and that's where it should rest appropriately.

And we will send a budget to Congress for them to consider. It would be great if Congress took our budgets and always passed them as we submitted them. But we know that they have a process as well, and that's why we'd like to see them reform as we make reforms.

QUESTION: Andy, who would be responsible -- I mean, how would he be held accountable for intelligence failures, if his position is outside of the Executive Office?

CARD: Well, right now the director of the Central Intelligence Agency is outside the Executive Office of the President. And he is the primary advisor to the president on intelligence matters under the 1947 act.

And we think the national intelligence director should have primary responsibility for advising the president on intelligence. And that's why we'd like to see Congress change the law to allow that to happen. This could not be done by executive action.

The CIA director right now has the legal authority and responsibility to be the principal intelligence advisor to the president of the United States. We think that that law should be changed so that the national intelligence director would have that responsibility. QUESTION: To go back to the question of the power and authority that this post would have, the 9/11 Commission recommendation includes a line that says, the national intelligence director should approve and submit nominations to the president of the individuals who would lead the CIA, DIA, FBI and a whole host of other agencies.

Would you call on Congress to include that kind of power in this job?

And do you also want statutory authority in the law, to translate your intention that he have significant power over the budget, expressly written into the law?

CARD: We would certainly want Congress to change the law to permit the national intelligence director to have a formal role in the budget process. And, yes, he should have the dominant role outside of the president's ability to recognize what is the best budget for the United States of America as an entity.

With regard to personnel, we feel very strongly that the national intelligence director should play a role, a coordinating role in the selection of people who are going to serve in our intelligence community. But we do not want to do anything that would undermine the chain of command and the responsibilities that go with the Department of Defense, the director of the Central Intelligence Agency, the secretary of the Homeland Security Department, and the other intelligence agencies, the attorney general, for example.

CARD: So we do not feel that people should be, quote, "appointed by and working for" the national intelligence director, if they also take command from the secretary of defense, for example, or the attorney general.

So that's why we would like to see them have a coordinating role in the selection. And these are not selections, by the way. They would be recommendations to the president or recommendations to a hiring authority.

(CROSSTALK)

CARD: Condi says it's concurrence. So they would...

RICE: Not just coordinating, but concurrence.

CARD: Concurrence.

QUESTION: If the Congress decides they didn't want to go with the commission's recommendation and create a Cabinet-level position, would the White House (OFF-MIKE)?

CARD: Well, the 9/11 Commission recommended that this position be Cabinet-level in pay, but not necessarily a member of the Cabinet. In fact, when I asked both Lee Hamilton and Tom Kean about this, they said, "We never recommended that it be made a member of the Cabinet." They recommended that it be cabinet-level pay.

And that's level one pay, for people who understand how the federal government pays people.

People who work at the White House are not paid level one. We are paid at the highest level, level two. And so, they...

RICE: (OFF-MIKE)

(LAUGHTER)

RICE: (OFF-MIKE) public record.

(LAUGHTER)

CARD: $150,000 or something.

But it's my understanding that their recommendations says it should be Cabinet-level, but not necessarily a member of the Cabinet. And Lee Hamilton, in particular, was saying, no, they were not make a recommendation that this individual had to serve on the Cabinet. It was more about the level of pay.

And, by the way, there are many other examples of that in the federal government, where people have Cabinet-level pay and are not automatically members of the president's Cabinet.

QUESTION: Mr. Card and Dr. Rice, somewhere in the world terrorists are watching and listening to what we do every day, especially (inaudible) they must have got their hands on the 9/11 report and all these recommendations.

And right after Senator Kerry's speech and 9/11 report, now we have raised the threat level up to orange.

QUESTION: What Americans should get from this message from the president? Where do we live? What is our future, as far as living under the threat of terrorism?

CARD: Well, I think America is much safer today than it was on September 11th, but we're not as safe as we'd like to be.

And the reforms that are recommended by the 9/11 Commission should help us get even safer. But that will not deter the president, and the president's not going to wait for all of those reforms to be implemented. Every day he is working to make this country safer.

But we know that the enemy wants to do us harm. And we have to be right 100 percent of the time. They only have to accomplish their mission of evil once. And so, we have to be ever vigilant. And American citizens are the most vigilant, so we appreciate their help.

We also have unprecedented cooperation between the federal government and state and local governments. And that's manifesting itself in the outstanding work that was done first in Boston during the Democratic National Convention and we see now taking place in New York City and in Newark and in Washington, D.C.

So we'll be working cooperatively. And Secretary Ridge and Fran Townsend have done a great job coordinating with state and local officials about understanding the current threats, which we take very seriously, and the need for to us harden targets and to be ready to respond.

But the ultimate goal is to defeat the terrorists before they have a chance to attack us. And if we can defeat them someplace else, rather than on the shores or in the United States, so much the better.

(CROSSTALK)

CARD: The international community is very important. And we are working very closely with our allies around the world to identify terrorist cells and have better intelligence and respond to that intelligence, working in partnership. And I think we've got a great track record of doing that.

The efforts centered around our understanding of the current threat have been assisted by many of our allies. The Italians and the British, for example, have been very cooperative, as well as the Pakistanis. So we've got a good international effort to help better understand the nature of the threat and how best to prevent it from manifesting itself.

QUESTION: In the context of the current threat and the urgency mentioned by the commission, more than mentioned by the commission, it would seem that a timetable or timetables are very important. And that is, when it comes down to the name of the national intelligence director and development of the center. And you could go back and mention homeland security development there; Mr. Ridge was appointed very, very quickly.

How quickly is the administration going to act?

CARD: Well, the president has said today that he will implement many of the recommendations that he can, unilaterally, before Congress has a chance to consider them, with regard to the report that came forward on September 11th.

He has also said that he will take a look at increasing the expectations for the CIA director to be able to work with an enhanced Terrorist Threat Integration Center and the coordination of the counterterrorism strategy group. And he'll do that very quickly, in a matter of weeks.

He'll also be...

QUESTION: Are you suggesting beyond (inaudible) director, and perhaps might be named as a national?

CARD: The president today said that he would be enhancing some of the authorities that currently rest with the central intelligence director, and especially in the context of the NCTC, the National Counter-Terrorism Center.

And he would like to see that happen very quickly, so we're taking the actions within the executive branch of government to be able to do that. It'll probably take us a couple of weeks, but we're going to move very very quickly to implement many of the recommendations that the president embraced this morning.

And we'll call on Congress to consider the other recommendations that they must be part of in an expeditious but important, deliberative way. Because these are big decisions. And, as you know, this is a model that will be there for many presidents. And so, we'd like to get it right. It's important that we get it right.

And we think that the president has put forward the right kind of solution to meet the terrorist threats as we know them. And we look forward to working with Congress to have it happen quickly.

QUESTION: This is probably more directed toward Ms. Townsend.

Muhammed Meyhador Khan (ph), who was the key figure in the intelligence gathering which to led to the orange alert, was arrested on July 13th.

QUESTION: And yet, on August -- it wasn't until yesterday, August 1st, that he was revealed to the public.

Why was there the delay between his arrest and the public revelations? And did this have anything to do with the Democratic Convention?

FRAN TOWNSEND, WHITE HOUSE HOMELAND SECURITY ADVISOR: Let me start with your last point, and that is, it had absolutely nothing to do with the Democratic National Convention.

Working backwards, your question, with all due respect, presumes that you are correct, that it is that one individual whose intelligence led to the raising of the threat level.

QUESTION: I should say one of the individuals.

TOWNSEND: That's right.

And as Secretary Ridge said yesterday, the source of the intelligence was -- there were multiple reporting streams that came together in such a way to give us real, grave concern.

I'd like to step back for one second, though, and take this opportunity to say to you: The reforms that the president has already put in place prior to the commission's recommendations, since 9/11, have led to a stronger intelligence community.

The fact is, because we're fighting this war overseas in places like Pakistan and Afghanistan, and working to strengthen our relationships with those allies has led to this intelligence stream. The fact is, our military, intelligence and diplomatic efforts in that part of the world fed directly into the homeland security system.

Tom Ridge and Bob Mueller are the beneficiaries of that. They're able to then focus the homeland security effort more directly and work with state and locals so that, as we move to defensive measures, they're more targeted.

Frankly, the stream went all the way from overseas to the hands of the people that could really do something about it in this country to make the country safer.

QUESTION: The administration is saying -- this is probably directed to Dr. Rice. The administration is saying it has already acted on many of the recommendations in the report. Can you talk about, specifically, some of the recommendations about reaching out to the Muslim world and how the president has acted on those specific recommendations?

RICE: Yes, of course, because there are a number of foreign policy recommendations in the commission report as well.

And on outreach to the Muslim world, the president actually has an outreach initiative to the Muslim world, but it is probably best known to you as part of what is called the Broader Middle East Initiative, which is clearly aimed at changing the circumstances that have produced the people who flew the airplanes into those buildings on September 11th.

RICE: That includes, of course, outreach on matters of economic development, outreach on matters of trade, outreach on matters of educational development, women's programs, programs with civil society.

And I should mention that this is a place where it's not just the United States, but at the G-8, then at the E.U. summit and then at NATO, the president asked for and received the very strong support of those organizations for outreach initiatives to the Muslim world.

The G-8, for instance, adopted a kind of charter and action plan for outreach to the Muslim world that includes very strong work with civil society, very strong work with women's groups, very strong work to try to improve the economic opportunities for young people in the Middle East. And this is a project that will only grow over time.

And so it's one thing to talk about the public diplomacy part of this, and I think the president wants to look harder at what might be done on the public diplomacy side to strengthen our efforts to get the message out to the Muslim world. But there is no greater outreach to the Muslim world than to say that the future is in greater freedom and liberty for peoples of the Muslim world, that there is no conflict between Islam and democratic values.

The president went to Turkey and talked about the importance of bridging to the Muslim world.

And so, I think you would see that the entire broader Middle East Initiative, the entire strategy for the president, is to have an outreach to the Muslim world built on democratic values, built on opportunity for people in the Muslim world. And he has an action plan to achieve it, including one that has the G-8, the E.U. and NATO signed on to it.

MCCLELLAN: Last question from Jeff.

QUESTION: Thank you.

Mr. Card, what is the background of a person that you would suggest to fill this new position? Would it be an academic, former military man, somebody from Congress? What are the qualifications that you would look for in a national intelligence director?

CARD: The most important thing would be to have the confidence of the president of the United States, so that that person would be able to come to the president and speak with great candor and offer unvarnished advice and counsel, as the analysis was reviewed and presented for the president to make tough policy decisions.

So, number one, I would say with the confidence of the president of the United States.

CARD: Beyond that, I think that the president would look to have someone who has an understanding of the intelligence community and of the various entities that make up the intelligence community in the executive branch of government -- and there are many of them -- and also have an understanding of kind of the government process, the budget process and how Congress would work and how the government has to function as kind of one voice representing the president's direction for the country and his obligation.

And remember, the oath that he took is the paramount responsibility that he has -- to preserve, protect and defend the Constitution -- meaning to preserve and protect our opportunity to participate in this great land.

QUESTION: Do you have anyone in mind?

CARD: Helen! Helen! I didn't think about you.

(LAUGHTER)

MCCLELLAN: Thank you. Thank you very much.

PHILLIPS: Andrew Card, White House chief of staff there, alongside Scott McClellan, the White House press secretary, saying I was a cattle prod to come to a consensus and have less debate when it came to discussing the role of a national director of intelligence.

Right now, a lot of conversation and questions going on about working with the 9/11 Commission and all the recommendations to find a national director of intelligence right now. Also Condoleezza Rice there, national security adviser, talking about an integrated intelligence budget, where will all of the money come from, how will Congress get involved in approving what kind of power this national director of intelligence will have and how this will all be funded.

A lot of questions out there, a lot of answers still to be defined, as these reforms go forward, or at least the conversation goes forward, on how to come to reforms suggested by the 9/11 Commission. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com