GWEN IFILL: Now, a look behind President Bush's decision to authorize a little-known spy agency to eavesdrop on Americans.
The National Security Agency, or NSA, is normally tasked with overseas surveillance. It's bigger than the FBI, bigger than the CIA.
But few Americans know of its existence on a low-profile campus in suburban Maryland. Secrecy is the very essence of its mission. But what should Americans know about an agency with such sweeping powers?
For that, we turn to two intelligence experts: John McLaughlin, the former acting director of the Central Intelligence Agency, had a three-decade career at the CIA. He's now a senior fellow at Johns Hopkins University. And James Bamford, the author of two books about the NSA, "The Puzzle Palace" and the "Body of Secrets."
James Bamford, tell us first about the NSA. Most people don't know it exists. They don't know what it does. What can you tell us about it?
JAMES BAMFORD: Well, actually that was the old joke at NSA: that the letters NSA stood for "no such agency" or "never say anything."
It's a huge agency, very, very large, about three times the size of the CIA. And the CIA is responsible largely for human spies, putting agents in different places and gathering information.
The NSA's job is electronic eavesdropping, spying electronically, bugging telephones, listening to cell phones, reading e-mails. It's the big ear. It's been called America's big ear for many years. And it's also a very dangerous agency if the agency is turned inward on the American public.
Sen. Frank Church in the mid '70s studied NSA and became very worried about it. He said the capability of NSA at any time, if it's turned around on the American people, no American would have any privacy left. There would be no place to hide. So it's an agency that has a lot of power and it's supposed to be directed externally at our adversaries in other countries around the world.
GWEN IFILL: John McLaughlin, in the years that you -- or the decades you were at the CIA, how critical was the NSA work to your own?
JOHN McLAUGHLIN: Well, absolutely critical. The NSA has played an enormously important role in capturing terrorists around the world. And the important thing to realize is that intelligent is a puzzle-solving operation. The material that NSA collects from electronic intelligence, technical work, has to be woven together with human intelligence, pictures from space, what we learn in the open source world in order to create a picture that gives us a view of the battlefield or a view of the terrorist landscape.
GWEN IFILL: A few nuts and bolts questions: Are we talking about wire taps or satellites? How does the NSA -- obviously you can't talk about everything that they do. But what kinds of efforts do they do? What kinds of tools do they use to do their job?
JOHN McLAUGHLIN: Well, I think I do have to be a little careful there. In fact, one of my concerns about this story is that so much has come out now it will damage our intelligence collection capability.
I would just say that the NSA has had to keep up with what every American should understand just from their daily life has been an absolute stunning revolution in technical -- in technical - technology and in communications technology, in particular.
So it's been a very challenging period for NSA as we've gone from sending cables and from the old world of technology to a world where we have universal handheld communication and much more sophisticated ways of encrypting communication that passes from one person to another.
GWEN IFILL: Mr. Bamford, what is normally the distinction between domestic surveillance -- who does that -- and international surveillance -- and how does this latest case blur that line?
JAMES BAMFORD: Well, traditionally the FBI has been responsible for domestic eavesdropping. And they do what basically can be referred to as retail eavesdropping. They'll go to a person's home, a person's office, a central switching office for the telephone company and attach some wires or some alligator cables, whatever, and eavesdrop on certain individuals.
The NSA, on the other hand, when it's eavesdropping on international communications, focuses on entire streams of communications such as communications coming down from communication satellites that can carry millions of phone calls.
And they'll intercept it in large dishes for example, or they'll intercept it by satellites and then filter it through very fast, very powerful computers that are loaded with people's names, people's telephone numbers, words, phrases, whatever they're looking for. And they'll gather tremendous amounts of telephone calls, e-mails and so forth.
One listening post, for example, in central England, Menwith Hill station, according to one of the former directors of NSA, collects about two million pieces of communications an hour. So it's a tremendously powerful agency for collecting and eavesdropping on information.
GWEN IFILL: Mr. McLaughlin, do you have any concerns at all about the sense that a line may have been approached if not crossed in this latest case, that is, that an agency that should be focusing on spying on our enemies theoretically may be spying on us?
JOHN McLAUGHLIN: Well, we're in a new era where it's difficult to use all of the terms that we've used in the past. While it's important to keep these distinctions in mind -- and it's certainly important to be mindful of our civil liberties, of course -- essentially 9/11 began to blur the line between foreign and domestic intelligence.
We were attacked in our own country. We weren't attacked somewhere else. And we were attacked by people who are in our own country but connected to foreign terrorists.
So the challenge in intelligence today is to bridge that line that once was so bright in our national security. Today we have to be able to generate intelligence in our own country that we can pass to the cop on the beat, to a CIA officer in some remote place and vice versa. That information has to flow back and forth.
GWEN IFILL: What is missing in the Foreign Intelligence Surveillance Act, which created that FISA court which creates -- which provides warrants when needed? What is missing in that act that the president needed in this case?
JOHN McLAUGHLIN: Well, let me say first that the FISA procedures are excellent and they're frequently used and very effective. They were designed for a different era and a different type of target. In 1978 when the act was created and today, that kind of procedure is for longstanding, stable targets where you have coverage over a long period of time.
What's happened in the communications revolution, though, is that people today jump from one phone number to another, one telephone to another. When you capture a terrorist overseas if you're lucky enough to capture all of the electronic media with that terrorist, you may have terabytes as data as much data as we have in a small public library.
You may have two or three hundred phone numbers that are related to people in the United States or e-mail addresses. If you were to get FISA's on all of those people, two or three hundred, it would take a tremendous amount of time; whereas, if you use some of the procedures that have been adopted under this particular program, you can quickly scour through that and figure out that maybe 90 percent of it, 99 percent of it is innocent or harmless or meaningless but there are two or three or four that are seriously connected to terrorists and you want to focus in on them. You might get FISA authority for those and dig deep on them.
GWEN IFILL: Let me ask Mr. Bamford about that. Do you agree in some ways in this new era, the post 9/11 era, that the FISA process is in inadequate?
JAMES BAMFORD: I disagree. FISA has been adequate all these years. If somebody needs a FISA warrant in a very quick period of time, it's provided for that. The court allows 48 hours, a 72-hour grace period so you can begin eavesdropping immediately.
Look, the FISA Act was enacted primarily because of abuses by the -- by President Nixon using the NSA domestically, spying domestically, using the NSA. And it went completely out of control because there was no firework -- I'm sorry -- no firewall between the NSA doing tremendous amounts of internal spying on U.S. Citizens and the American citizens who deserve some privacy.
GWEN IFILL: And let me just follow up on that for a moment. One of the things that the president, the White House has said, is that they are concerned -- they believe they have the authority to do this because Congress enacted a war powers resolution which allowed him to use all necessary and appropriate force. Those are the terms that they use. Can you think of a case where that's happened before?
JAMES BAMFORD: Well, actually, you know, if you read the FISA Act it actually takes that into consideration. It says in a time of war, you can have an extra 15 days to present the information to the FISA court for a warrant. But it's very clear the whole idea of the FISA Act was to keep presidential power from getting out of control and using an agency like NSA to spy on American citizens.
One of the things that was said when they created the law was that this bill specifically states that the protections in the bill are the exclusive means by which the government can get permission to eavesdrop. And it said that the --it recognizes no inherent power of the president to conduct electronic surveillance. That's what the law says and the law provides the penalty of five years in jail if you go around the law, which was done.
Now if they have a problem with that law, the place to solve that problem is by creating new laws or fixing this law in Congress. And I saw no effort by the administration to try to do that.
JOHN McLAUGHLIN: Gwen, I just want to add there that Jim and I aren't going to be able to settle these complex legal issues here today. People are making arguments on both sides of it. I think in the end the president's action will be shown to be legal. But I say that as a non-lawyer.
I want to point out though Jim used the word "abuse." There's not been a single shred of evidence so far and I would be surprised if one ever appears that this program has been the vehicle for any abuse of any civilian or any citizens' rights.
It's not a drift net that's hanging over our city scooping up all kinds of private conversation. It's a very precise targeted instrument.
GWEN IFILL: Well -- go ahead
JOHN McLAUGHLIN: And also let me just add one other point here. Even though there are emergency procedures where you can get a warrant and then have 72 hours to justify it, it's also true that in that 72 hours in this modern communication era, it's highly likely that the terrorist you're following is on a different phone number, a different cell phone and you'd be getting warrants one after another, which let me come back to it and say that's not to say that FISA is not an important instrument. It's been very effective for a certain type of terrorist target. But we need more agility and more speed and I think that's what the president was searching for here.
GWEN IFILL: Well, let me ask you about this. Since we're talking about secrets and we're talking about the realm of secrecy. How concerned are you or are you concerned at all about the leak, which brought all of it to light?
JOHN McLAUGHLIN: Oh, absolutely. This is to me as an intelligence professional and a practitioner and someone who is involved in counterterrorism, this leak will damage us greatly.
This is the kind of program that filled in a gap in our coverage. People say: Well, didn't the terrorists know we were listening to them? Don't we know we intercept their conversations? Well we don't know that.
Well, we don't think that they know that we are as good as we have been. They now know that. They know a lot more today than they did before this leak.
This is the kind of program that allowed us to detect people in our own country who were affiliated with al-Qaida, intending to do harm, link them to plots overseas and detect people come to go this country with the intention of doing harm. So I think it will be harmful.
GWEN IFILL: John McLaughlin and James Bamford, I'm sorry, we're out of time. Thank you both very much.