U.S. Intel Head James Clapper on Greatest Threats in 2012

Jan. 31, 2012 — -- The man in charge of all of America's intelligence gathering testified today before the Senate Select Committee on Intelligence for the annual Worldwide Threat Assessment. The following are excerpts from National Director of Intelligence James Clapper's prepared remarks as provided to ABC News.

On Iran: We Don't Know If They'll Go for The Bomb, 'Concerned' About Attack on U.S.

"We assess Iran is keeping open the option to develop nuclear weapons, in part by developing various nuclear capabilities that better position it to produce such weapons, should it choose to do so. We do not know, however, if Iran will eventually decide to build nuclear weapons. Iran nevertheless is expanding its uranium enrichment capabilities, which can be used for either civil or weapons purposes."

"Iran's technical advancement, particularly in uranium enrichment, strengthens our assessment that Iran has the scientific, technical, and industrial capacity to eventually produce nuclear weapons, making the central issue its political will to do so. These advancements contribute to our judgment that Iran is technically capable of producing enough highly enriched uranium for a weapon, if it so chooses. We judge Iran would likely choose missile delivery as its preferred method of delivering a nuclear weapon… Elite infighting has reached new levels, as the rift grows between Supreme Leader Khamenei and President Ahmadinejad."

"The 2011 plot to assassinate the Saudi ambassador to the United States shows that some Iranian officials -- probably including Supreme Leader Ali Khamenei -- have changed their calculus and are now more willing to conduct an attack in the United States in response to real or perceived U.S. actions that threaten the regime. We are also concerned about Iranian plotting against U.S. or allied interests overseas. Iran's willingness to sponsor future attacks in the United States or against our interests abroad probably will be shaped by Tehran's evaluation of the costs it bears for the plot against the ambassador as well as Iranian leaders' perceptions of U.S. threats against the regime."

On Terrorism: Al Qaeda 'Core' Weakening, Affiliates and Homegrown Terror Greater Threats

"The next two to three years will be a critical transition phase for the terrorist threat facing the United States, particularly from al Qaeda and like-minded groups… During this transition, we expect leadership of the movement to become more decentralized, with 'core' al Qaeda -- the Pakistan-based group formerly led by Osama bin Laden -- diminishing in operational importance; regional al Qaeda's affiliates planning and attempting terrorist attacks; multiple voices providing inspiration for the movement; and more vigorous debate about local versus global agendas."

"We do not assess that al Qaeda's new leader, Ayman al-Zawahiri, will change al Qaeda's strategic direction, but most al Qaeda members find Zawahiri's leadership style less compelling than bin Laden's image as a holy man and warrior and will not offer him the deference they gave bin Laden."

"We judge that al Qaeda's losses are so substantial and its operating environment so restricted that a new group of leaders, even if they could be found, would have difficulty integrating into the organization and compensating for mounting losses."

Despite this, the DNI's statement notes that al Qaeda regional affiliates "will remain committed to the group's ideology, and in terms of threats to U.S. interests will surpass the remnants of core al Qaeda in Pakistan."

"We judge al Qaeda operatives are balancing support for attacks in Pakistan with guidance to refocus the global jihad externally, against U.S. targets. Al Qaeda also will increasingly rely on ideological and operational alliances with Pakistani militant factions to accomplish its goals within Pakistan and to conduct transnational attacks. Pakistani military leaders have had limited success against al Qaeda operatives, other foreign fighters, and Pakistani militants who pose a threat to Islamabad."

Al Qaeda in the Arabian Peninsula (AQAP)

Although high-profile al Qaeda cleric and recruiter Anwar Awlaki has been killed, the intelligence chief notes in his testimony that al Qaeda in the Arabian Peninsula (AQAP), the group to which Awlaki belonged, remains dangerous.

"We judge AQAP remains the node most likely to attempt transnational attacks. [Awlaki's] death probably reduces, at least temporarily, AQAP's ability to plan transnational attacks, but many of those responsible for implementing plots, including bomb makers, financiers, and facilitators, remain and could advance plots."

Al Qaeda in Iraq (AQI)

"We assess that AQI (al Qaeda in Iraq) will remain focused on overthrowing the Shia-led government in Baghdad in favor of a Sunni-led Islamic caliphate. It probably will attempt attacks primarily on local Iraqi targets, including government institutions, Iraqi Security Forces personnel, Shia civilians, and recalcitrant Sunnis, such as members of the Sons of Iraq, and will seek to rebuild support among the Sunni population…. The Iraqi Government is positioned to keep violence near current levels through 2012, although periodic spikes are likely. Iraqi Security Forces (ISF) are capable of planning and executing security operations, and Iraqi counter-terrorism forces have demonstrated they are capable of targeting remaining terrorists and insurgents."

Al Shabaab, Somalia

Clapper said the main issue concerning the al Qaeda-linked terror group al Shabaab in east Africa is with American-born fighters who have joined the group.

"Members of the group -- particularly a foreign fighter cadre that includes U.S. passport holders -- may also have aspirations to attack inside the United States. However, we lack insight into concrete operational plans outside the Horn of Africa."

Homegrown Threat

Clapper said that homegrown extremists may move to attack in the U.S. if America or the West engages in war in another Muslim nation. In his testimony Clapper notes that extremists may learn from past plots and averted attacks and disruptions.

On Afghanistan: Taliban Still Has 'Safe Haven' in Pakistan

Discussing the Taliban the intelligence chief said "its losses have come mainly in areas where ISAF (International Security Assistance Force) surge forces are concentrated. It remains resilient and capable of challenging U.S. and international goals and Taliban senior leaders continue to enjoy safe haven in Pakistan, which enables them to provide strategic direction to the insurgency and not fear for their safety. We assess al Qaeda's impact on the Afghanistan insurgency is limited."

"That said, al Qaeda is committed to the Afghan jihad, and the propaganda gains from participating in insurgent attacks outweigh their limited battlefield impact," he said. "In terms of security, we judge that the Afghan police and Army will continue to depend on ISAF support."

Clapper also notes that Afghans earned $1.8 billion from the drug trade last year.

On North Korea: To Early to Judge New Leader, Two Nuclear Weapon Tests

"North Korea's nuclear weapons and missile programs pose a serious threat to the security environment in East Asia. Its export of ballistic missiles and associated materials to several countries, including Iran and Syria, and its assistance to Syria -- now ended -- illustrate the reach of the North's proliferation activities. We remain alert to the possibility that North Korea might again export nuclear technology."

Kim Jong Un became North Korea's leader following the death of his father, Kim Jong Il, on 17 December 2011. Although it is still early to assess the extent of his authority, senior regime leaders will probably remain cohesive at least in the near term to prevent instability and protect their interests."

Clapper said that the U.S. intelligence community believes North Korea has tested two nuclear devices.

On the Arab Spring: Turmoil Will 'Challenge' U.S. Influence, Terrorists Could Exploit Unrest

"The Arab world is in a period of turmoil and change that will challenge the ability of the United States to influence events in the Middle East. This turmoil is driven by forces that will shape Arab politics for years, including a large youth population; economic grievances associated with persistent unemployment, inequality, and corruption; increased popular participation and renewed hope in effecting political change; and a greater ability by opposition groups to mobilize nonviolent resistance on a large scale."

"Meanwhile, the forces propelling change are confronting ruling elites; sectarian, ethnic, and tribal divisions; lack of experience with democracy; dependence on natural resource wealth; and regional power rivalries…This new regional environment poses challenges for U.S. strategic partnerships in the Arab world. However, we judge that Arab leaders will continue to cooperate with the United States on regional security to help check Iran's regional ambitions, and some will seek economic assistance."

"The unrest potentially provides terrorists inspired by the global jihadist movement more operating space, as security services focus more on internal security and, in some cases, undergo transformations in make-up and orientation. Ongoing unrest most likely would exacerbate public frustration, erosion of state power, and economic woes -- conditions that al Qaeda would work to exploit. The ongoing turmoil probably will cause at least a temporary setback to CT (counter-terrorism) efforts and might prove a longer-term impediment, if successor governments view violent Sunni extremism as a less immediate threat than did previous regimes."

On the Cyber Threat to the U.S.: Governments Can't Keep Up with Technology

In his testimony, Clapper notes that cyber threats are likely to increase in the coming years.

"We currently face a cyber environment where emerging technologies are developed and implemented faster than governments can keep pace, as illustrated by the failed efforts at censoring social media during the 2011 Arab Spring revolutions in Tunisia, Egypt, and Libya. Hacker groups, such as Anonymous and Lulz Security (LulzSec), have conducted distributed denial of service (DDoS) attacks and website defacements against government and corporate interests they oppose. The well publicized intrusions into NASDAQ and International Monetary Fund (IMF) networks underscore the vulnerability of key sectors of the U.S. and global economy."

The intelligence chief also notes that computer-espionage is becoming a greater concern with foreign services targeting classified networks that may not be detected.

"We assess that many intrusions into U.S. networks are not being detected. Although most activity detected to date has been targeted against unclassified networks connected to the Internet, foreign cyber actors have also begun targeting classified networks".

On Drinking Water Resources: Shortages, Floods Will Hurt U.S. National Security

During the next 10 years, water problems will contribute to instability in states important to U.S. national security interests.

Water shortages, poor water quality, and floods are unlikely to result in state failure. However, water problems combined with poverty, social tensions, environmental degradation, ineffectual leadership, and weak political institutions contribute to social disruptions that can result in state failure.

Now and for the foreseeable future, water shortages and pollution probably will negatively affect the economic performance of important U.S. trading partners.