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The Ironies of the EO 12333 Sharing Expansion for Obama and Trump

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In one of his first acts as leader of the Democratic party in 2008, Barack Obama flipped his position on telecom immunity under FISA Amendments Act, which cleared the way for its passage. That was a key step in the legalization of the Stellar Wind dragnet illegally launched by George Bush in 2001, the normalization of turnkey surveillance of the rest of the world, surveillance that has also exposed countless Americans to warrantless surveillance.

Bookends of the Constitutional law president’s tenure: codifying and expanding Stellar Wind

So it is ironic that, with one of his final acts as President, Obama completed the process of normalizing and expanding Stellar Wind with the expansion of EO 12333 information sharing.

As I laid out some weeks ago, on January 3, Loretta Lynch signed procedures that permit the NSA to share its data with any of America’s other 16 intelligence agencies. This gives CIA direct access to NSA data, including on Americans. It gives all agencies who jump through some hoops that ability to access US person metadata available overseas for the kind of analysis allegedly shut down under USA Freedom Act, with far fewer limits in place than existed under the old Section 215 dragnet exposed by Edward Snowden.

And it did so just as an obvious authoritarian took over the White House.

I’ve was at a privacy conference in Europe this week (which is my partial explanation for being AWOL all week), and no one there, American or European, could understand why the Obama Administration would give Trump such powerful tools.

About the only one who has tried to explain it is former NSA lawyer Susan Hennessey in this Atlantic interview.

12333 is not constrained by statute; it’s constrained by executive order. In theory, a president could change an executive order—that’s within his constitutional power. It’s not as easy as just a pen stroke, but it’s theoretically possible.

[snip]

When they were in rewrites, they were sort of vulnerable. There was the possibility that an incoming administration would say, “Hey! While you’re in the process of rewriting, let’s go ahead and adjust some of the domestic protections.” And I think a reasonable observer might assume that while the protections the Obama administration was interested in putting into place increased privacy protections—or at the very least did not reduce them—that the incoming administration has indicated that they are less inclined to be less protective of privacy and civil liberties. So I think it is a good sign that these procedures have been finalized, in part because it’s so hard to change procedures once they’re finalized.

[snip]

I think the bottom line is that it’s comforting to a large national-security community that these are procedures that are signed off by Director of National Intelligence James Clapper and Attorney General Loretta Lynch, and not by the DNI and attorney general that will ultimately be confirmed under the Trump Administration.

Hennessey’s assurances ring hollow. That’s true, first of all, because it is actually easier to change an EO — and EO 12333 specifically — than “a pen stroke.” We know that because John Yoo did just that, in authorizing Stellar Wind, when he eliminated restrictions on SIGINT sharing without amending EO 12333 at all. “An executive order cannot limit a President,” Yoo wrote in the 2001 memo authorizing Stellar Wind. “There is no constitutional requirement for a President to issue a new executive order whenever he wishes to depart from the terms of a previous executive order. Rather than violate an executive order, the President has instead modified or waived it.” And so it was that the NSA shared Stellar Wind data with CIA, in violation of the plain language of EO 12333 Section 2.3, until that sharing was constrained in 2004.

Yes, in 2008, the Bush Administration finally changed the language of 2.3 to reflect the SIGINT sharing it had started to resume in 2007-2008. Yes, this year the Obama Administration finally made public these guidelines that govern that sharing. But recent history shows that no one should take comfort that EOs can bind a president. They cannot. The Executive has never formally retracted that part of the 2001 opinion, which in any case relies on a 1986 OLC opinion on Iran-Contra arguing largely the same thing.

No statutorily independent oversight over vastly expanded information sharing

Which brings us to whether the EO sharing procedures, as released, might bind Trump anymore than EO 12333 bound Bush in 2001.

In general, the sharing procedures are not even as stringent as other surveillance documents from the Obama Administration. The utter lack of any reasonable oversight is best embodied, in my opinion, by the oversight built into the procedures. A key cog in that oversight is the Department of National Intelligence’s Privacy and Civil Liberties Officer — long inhabited by a guy, Alex Joel, who had no problem with Stellar Wind. That role will lead reviews of the implementation of this data sharing. In addition to DNI’s PCLO, NSA’s PCLO will have a review role, along with the General Counsels of the agencies in question, and in some limited areas (such as Attorney Client communications), so will DOJ’s National Security Division head.

What the oversight of these new sharing procedures does not include is any statutorily independent position, someone independently confirmed by the Senate who can decide what to investigate on her own. Notably, there is not a single reference to Inspectors General in these procedures, even where other surveillance programs rely heavily on IGs for oversight.

There is abundant reason to believe that the PATRIOT Act phone and Internet dragnets violated the restrictions imposed by the FISA Court for years in part because NSA’s IG’s suggestions were ignored, and it wasn’t until, in 2009, the FISC mandated NSA’s IG review the Internet dragnet that NSA’s GC “discovered” that every single record ingested under the program violated FISC’s rules after having not discovered that fact in 25 previous spot checks. In the past, then, internal oversight of surveillance has primarily come when IGs had the independence to actually review the programs.

Of course, there won’t be any FISC review here, so it’s not even clear whether explicit IG oversight of the sharing would be enough, but it would be far more than what the procedures require.

I’d add that the Privacy and Civil Liberties Oversight Board, which provided key insight into the Section 215 and 702 programs, also has no role — except that PCLOB is for all intents and purposes defunct at this point, and there’s no reason to believe it’ll become operational under Trump.

Obama vastly expanded information sharing with these procedures without implementing the most obvious and necessary oversight over that sharing, statutorily independent oversight.

Limits on using the dragnet to affect political processes

There is just one limit in the new procedures that I think will have any effect whatsoever — but I think Trump may have already moved to undercut it.

The procedures explicitly prohibit what everyone should be terrified about under Trump — that he’ll use this dragnet to persecute his political enemies. Here’s that that prohibition looks like.

Any IC element that obtains access to raw SIGINT under these Procedures will:

[snip]

Political process in the United States. Not engage in any intelligence activity authorized by these Procedures, including disseminations to the White House, for the purpose of affecting the political process in the United States. The IC element will comply with the guidance applicable to NSA regarding the application of this prohibition. Questions about whether a particular activity falls within this prohibition will be resolved in consultation with the element’s legal counsel and the General Counsel of the Office of the Director of National Intelligence (ODNI) (and the DoD’s Office of the General Counsel in the case of a DoD IC element).

If you need to say the IC should not share data with the White House for purposes of affecting the political process, maybe your info sharing procedures are too dangerous?

Anyway, among the long list of things the IC is not supposed to do, this is the only one that I think is so clear that it would likely elicit leaks if it were violated (though obviously that sharing would have to be discovered by someone inclined to leak).

All that said, note who is in charge of determining whether something constitutes affecting political processes? The IC agency’s and ODNI’s General Counsel (the latter position is vacant right now). Given that the Director of National Intelligence is one of the positions that just got excluded from de facto participation in Trump’s National Security Council (in any case, Republican Senator Dan Coats has been picked for that position, which isn’t exactly someone you can trust to protect Democratic or even democratic interests), it would be fairly easy to hide even more significant persecution of political opponents.

FBI and CIA’s expanded access to Russian counterintelligence information

There is, however, one aspect of these sharing guidelines that may have work to limit Trump’s power.

In the procedures, the conditions on page 7 and 8 under which an American can be spied on under EO 12333 are partially redacted. But the language on page 11 (and in some other parallel regulations) make it clear one purpose under which such surveillance would be acceptable, as in this passage.

Communications solely between U.S. persons inadvertently retrieved during the selection of foreign communications will be destroyed upon recognition, except:

When the communication contains significant foreign intelligence or counterintelligence, the head of the recipient IC element may waive the destruction requirement and subsequently notify the DIRNSA and NSA’s OGC;

Under these procedures generally, communications between an American and a foreigner can be read. But communications between Americans must be destroyed except if there is significant foreign intelligence or counterintelligence focus. This EO 12333 sharing will be used not just to spy on foreigners, but also to identify counterintelligence threats (which would presumably include leaks but especially would focus on Americans serving as spies for foreign governments) within the US.

Understand: On January 3, 2017, amid heated discussions of the Russian hack of the DNC and public reporting that at least four of Trump’s close associates may have had inappropriate conversations with Russia, conversations that may be inaccessible under FISA’s probable cause standard, Loretta Lynch signed an order permitting the bulk sharing of data to (in part) find counterintelligence threats in the US.

This makes at least five years of information collected on Russian targets available, with few limits, to both the CIA and FBI. So long as the CIA or FBI were to tell DIRNSA or NSA’s OGC they were doing so, they could even keep conversations between Americans identified “incidentally” in this data.

I still don’t think giving the CIA and FBI (and 14 other agencies) access to NSA’s bulk SIGINT data with so little oversight is prudent.

But one of the only beneficial aspects of such sharing might be if, before Trump inevitably uses bulk SIGINT data to persecute his political enemies, CIA and FBI use such bulk data to chase down any Russian spies that may have had a role in defeating Hillary Clinton.

The Significance of the December 13 Trump Dossier Report

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John Brennan and Donald Trump are in a fight.

In his press conference last week, Trump called out the intelligence community for “allowing … information that turned out to be so false and fake” out, likening the leak to something that would happen in Nazi Germany.

I think it was disgraceful, disgraceful that the intelligence agencies allowed any information that turned out to be so false and fake out. I think it’s a disgrace. And I say that and I say that.

And that’s something that Nazi Germany would have done and did do. It’s a disgrace. That information that was false and fake and never happened got released to the public, as far as BuzzFeed, which is a failing pile of garbage, writing it, I think they’re going to suffer the consequences.

Over the weekend, Brennan went on Fox News to scold Trump for the Nazi analogy. At that appearance, he said this about the release of the dossier.

I think as the Director of National Intelligence said in his statement, this is information that’s been out there, circulating, for many months. So it’s not a question of the intelligence community leaking or releasing this information. It was already out there.

[snip]

There is no basis for Mr. Trump to point fingers at the intelligence community for leaking information that was already available publicly.

In response to Brennan’s appearance (and his suggestion Trump didn’t know what the fuck he was doing in Syria and Russia), Trump insinuated that Brennan may have leaked the dossier.

Let’s unpack this. Because while I have no idea who leaked the document (though I highly doubt Brennan would have done so personally), the intelligence community’s claims are really suspect.

As I noted last week, the James Clapper statement rather bizarrely claimed the IC was the last to know about the document. The dossier, according to Clapper, was “widely circulated in recent months among the media, members of Congress and Congressional staff even before the IC became aware of it.”

That (as some people have pointed out) cannot be true.

The stories about what Christopher Steele did when have been evolving. But David Corn’s description, based off a conversation that occurred before the IC started making public claims, strongly suggests that Steele started sharing documents with the FBI “soon” after “the end of June.”

By the end of June, he was sending reports of what he was finding to the American firm.

The former spy said he soon decided the information he was receiving was “sufficiently serious” for him to forward it to contacts he had at the FBI. He did this, he said, without permission from the American firm that had hired him. “This was an extraordinary situation,” he remarked.

Some other reports, based off claims made after the Clapper statement, put this date later — maybe August — even while the implication has always been that the FBI request for a FISA warrant in June stems from these reports.

Even if that information sharing dates to August, however, it would mean the FBI — a member of the IC — had regular updates from the dossier at least by then, if not by June. Sure, you might claim that FBI investigative teams are not part of the IC, but given that this would be a counterintelligence investigation, that’d be a laughable claim.

In other words, even assuming the claims about where the dossier came from and who paid for it are true, the IC was not the last to know, but one of the first.

There are two other dates of note that go into the claim the dossier was widely circulated before it got briefed to Trump this month. We know that the IC briefed the Gang of Eight on this dossier in October. Shortly thereafter, Corn received a copy of the dossier and wrote about it (though he has not revealed who gave it to him). Then in December, John McCain got a copy from Sir Andrew Wood. According to a Guardian article published around 9AM on the same day as the Clapper statement, McCain had not only received the dossier, but handed it over — yet another copy — to the FBI on December 9.

Senator John McCain, who was informed about the existence of the documents separately by an intermediary from a western allied state, dispatched an emissary overseas to meet the source and then decided to present the material to Comey in a one-on-one meeting on 9 December, according to a source aware of the meeting. The documents, which were first reported on last year by Mother Jones, are also in the hands of officials in the White House.

McCain, in a statement released midday on the day of the Clapper statement, is more vague about the hand-off date, describing it only as “late last year.”

I’m working on the specific times, but it is significant that the Guardian with the exact date came out in the morning on January 11, the vague McCain statement came out mid-day sometime, and Clapper’s statement came out that evening.

That’s significant because some people assume that McCain is the one who released the dossier — the dossier he received on December 9.

If that date is correct, the dossier couldn’t have come from McCain, because the last report in the dossier is dated four days later, December 13.

Very significantly, this last report, which talks about the Russian cover-up of the hack, alleges “the operatives involved had been paid by both TRUMP’s team and the Kremlin.” This is, in my opinion, one of the most incendiary claims in the entire dossier — that Trump not only encouraged Russia’s campaign, but paid operatives involved in it.

Just as significantly, the date completely undermines the substance of Brennan’s defense. When he says, “this is information that’s been out there, circulating, for many months. … It was already out there. … There is no basis for Mr. Trump to point fingers at the intelligence community for leaking information that was already available publicly,” he’s wrong. The full set of information released to BuzzFeed — including the allegation Trump paid for this operation — actually hasn’t been out there, because it post-dates all known circulation of the document.

Also remember that journalists have suggested they got copies of the dossier that redacted all the sources. This one didn’t. At least one likely source named in the report has died in curious circumstances since the release of the report.

I really have no idea where the dossier got leaked from — that is one reason I’m so interested in artifacts in the document that may raise questions about the provenance of the released dossier. I also wouldn’t, at this point, be surprised if Trump were getting his own stream of intelligence, possibly even from Russia, about where and how it got released.

But thus far, the IC’s claims about the dossier are even more dodgy than Trump’s, which is saying something.

The Released Trump Dossier Is Not the Complete Dossier

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Update: Also note that these reports are not done in the same typeface, with variations between sans serif and serif fonts, changes to margins, and at least one report changing font size mid-report. I’ve marked those below as well, and will continue to work on margin size. I’ve been informed that this is a way the Brits track leakers, which means this copy should be identifiable to a particular leaker. 

I want to return to a point I made here about the dossier — billed as an oppo research project — on Donald Trump’s ties to Russia.

This is not the complete dossier. It was selectively released.

The gaps are immediately identifiable from the report numbering, which (as released) goes like this:

  • 080: June 20, 2016, serif
  • 086: July 26, 2015 (citing events in 2016), serif
  • 095: not dated, serif
  • 94: July 19, 2016, serif
  • 097: July 30, 2016, sans, justified
  • 100: August 5, 2016, serif, note typeface size change
  • 101: August 10, 2016, sans
  • 102: August 10, 2016, sans
  • 136: October 20, 2016, serif, wider margins
  • 105: August 22, 2016, serif
  • 111: September 14, 2016, serif
  • 112: September 14, 2016, serif
  • 113: September 14, 2016, serif
  • 130: October 12, 2016, larger sans
  • 134: October 18, 2016, smaller serif
  • 135: October 19, 2016, serif
  • 166: December 13, 2016, serif

You might think some of this is just about pages being out of order but someone — perhaps Buzzfeed? — wrote in page numbers by hand on the lower right.

So the reporting was frequent, sometimes more than daily. It must have started sometime in April, if not before (which explains how a project started by a Republican challenger to Trump ends up with a June 2016 report; we just don’t have the first 79 reports); it’s even possible the earlier reporting included more details on Hillary. Over that time, the reporting protocol changed (no longer identifying each source with a letter). And the reports continue into December, well past the election, and well past the time a Hillary supporter — ostensibly the funder for this project — might want to influence the election.

Reports 94 and 095 are especially weird, as it appears that the temporal sequences is broken. 095 reports on the general scope of the campaign against Hillary. 94 reports on meetings between Carter Page and Igor Sechin.

None of this explains why those gaps exist or what the oddness in reports 94 and 095 stem from. But it is a real reason to question the provenance of the copy BuzzFeed got.

Update: I’ve been informed that these kinds of typeface changes are a way the Brits use to track leakers.

So they may know who the leaker is here.

Here are two screen shots showing the justification and typeface change that happens at report 097.

Here’s page one of report 100. The last line seems to extend beyond the right margin.

The next page of report 100 has noticeably smaller typeface and an apparently different left margin.

Report 101 is back to right justified sans typeface, but much smaller than the one used in report 097. These screen caps are both 100X100 pixels.

 

How Did the IC Allegedly Remain Unaware of a Dossier Widely Shopped in DC?

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Donald Trump spent yesterday and today going nuts because of the leak of the oppo research dossier. In response last night, James Clapper (who must be counting the seconds until he’s out of here at this point) spoke to Trump personally, then released a statement revealing what he had said. The statement reads:

This evening, I had the opportunity to speak with President-elect Donald Trump to discuss recent media reports about our briefing last Friday. I expressed my profound dismay at the leaks that have been appearing in the press, and we both agreed that they are extremely corrosive and damaging to our national security.

We also discussed the private security company document, which was widely circulated in recent months among the media, members of Congress and Congressional staff even before the IC became aware of it. I emphasized that this document is not a U.S. Intelligence Community product and that I do not believe the leaks came from within the IC. The IC has not made any judgment that the information in this document is reliable, and we did not rely upon it in any way for our conclusions. However, part of our obligation is to ensure that policymakers are provided with the fullest possible picture of any matters that might affect national security.

President-elect Trump again affirmed his appreciation for all the men and women serving in the Intelligence Community, and I assured him that the IC stands ready to serve his Administration and the American people.

While most have focused on the seeming confirmation that a summary of the dossier was included in Trump’s briefing on Friday, I’m most interested in the claim (one I don’t entirely believe) that the IC did not learn about this dossier until after the dossier “was widely circulated in recent months among the media, members of Congress and Congressional staff.”

According to one public claim, the IC learned of the dossier sometime before a late October briefing to the Gang of Eight, one that led Harry Reid to complain publicly that the FBI Was sitting on explosive information.

During that period, the leader of the Democrats in the Senate, Harry Reid, wrote to the director of the FBI, accusing him of holding back “explosive information” about Mr Trump.

Mr Reid sent his letter after getting an intelligence briefing, along with other senior figures in Congress. Only eight people were present: the chairs and ranking minority members of the House and Senate intelligence committees, and the leaders of the Democratic and Republican parties in Congress, the “gang of eight” as they are sometimes called. Normally, senior staff attend “gang of eight” intelligence briefings, but not this time. The Congressional leaders were not even allowed to take notes.

According to another claim — one backed by an on-the-record statement — McCain formally told Comey about the dossier on December 9 (which is the day leakapalooza started).

But I find it really hard to believe that Christopher Steele (the former MI6 officer who created the dossier) was shopping its contents for months without the IC asking some questions. And if it’s true, it means the dossier is entirely separate from the FISA warrant first sought in June.

Not to mention the fact, ODNI seems to be disclaiming IC involvement in things that antagonize Trump right now in ways I find really unconvincing, particularly with respect to CIA.

Ah well. The Intelligence Community. Always the last to know.

Is Trump’s Revelation the Same as Craig Murray’s Revelation: An American Cut-Out?

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Because security professionals are so confident in the Russian attribution of the DNC hack, they have largely ignored alternative theories from the likes of Wikileaks and Bill Binney. That’s unfortunate, because Craig Murray, in his description of his own role in getting the Podesta files to Wikileaks, at least, revealed a detail that needs greater attention. He believes he received something (perhaps the documents themselves, perhaps something else) from a person with ties to US national security.

[I]f we believe that Murray believes this, we know that the intermediary can credibly claim to have ties to American national security.

So on September 25, Murray met a presumed American in DC for a hand-off related to the Podesta hack.

I raise that because Trump is now promising we’ll learn something this week about the hack that may cast doubt on the claims Russia was behind it.

He added: “And I know a lot about hacking. And hacking is a very hard thing to prove. So it could be somebody else. And I also know things that other people don’t know, and so they cannot be sure of the situation.”

When asked what he knew that others did not, Mr. Trump demurred, saying only, “You’ll find out on Tuesday or Wednesday.”

If Murray met an American claiming to have done the hack, then Trump may have too. That doesn’t mean the Russians didn’t do the hack (though it could mean an American borrowed GRU’s tools to do it). It could just as easily mean the Russians have an American cut-out, and that while the security community has been looking for Russian-speaking proxies, they’ve ignored the possibility of American ones.

I have a suspicion that Trump’s campaign did meet with such a person (I even have a guess about when it would have happened).

I guess we’ll learn more this week.

Matt Olsen Admits He Didn’t Bargain on a President Trump

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Something predictable, but infuriating, happened at least week’s Cato conference on surveillance.

A bunch of spook lawyers did a panel, at which they considered the state of surveillance under Trump. Former White House Director of Privacy and Civil Liberties Tim Edgar asked whether adhering to basic norms, which he suggested would otherwise be an adequate on surveillance, works in a Trump Administration.

In response, former NSA General Counsel Matt Olsen provided an innocuous description of the things he had done to expand the dragnet.

I fought hard … in the last 10 [years] when I worked in national security, for increasing information sharing, breaking down barriers for sharing information, foreign-domestic, within domestic agencies, and for the modernization of FISA, so we could have a better approach to surveillance.

Then, Olsen admitted that he (who for three years after he left NSA headed up the National Counterterrorism Center managing a ton of analysts paid to imagine the unimaginable) did not imagine someone like Trump might come along.

As I fought for these changes, I did not bargain on a President Trump. That was beyond my ability to imagine as a leader of the country in thinking about how these policies would actually be implemented by the Chief Executive.

It was beyond his ability [breathe, Marcy, breathe] to imagine someone who might abuse power to come along!!!

What makes Olsen’s comment even more infuriating that I called out Olsen’s problematic efforts to “modernize” FISA and sustain the phone dragnet even in spite of abuse in September, in arguing that Hillary could not, in fact, be supporting a balanced approach on intelligence if she planned on hiring him, as seemed likely.

Olsen was the DOJ lawyer who oversaw the Yahoo challenge to PRISM in 2007 and 2008. He did two things of note. First, he withheld information from the FISC until forced to turn it over, not even offering up details about how the government had completely restructured PRISM during the course of Yahoo’s challenge, and underplaying details of how US person metadata is used to select foreign targets. He’s also the guy who threatened Yahoo with $250,000 a day fines for appealing the FISC decision.

Olsen was a key player in filings on the NSA violations in early 2009, presiding over what I believe to be grossly misleading claims about the intent and knowledge NSA had about the phone and Internet dragnets. Basically, working closely with Keith Alexander, he hid the fact that NSA had basically willfully treated FISA-collected data under the more lenient protection regime of EO 12333.

These comments were used, in this post by former NSA Compliance chief John DeLong and former NSA lawyer Susan Hennessey (the latter of whom was on this panel) to unbelievably dishonestly suggest that surveillance skeptics, embodied by me and EFF’s Nate Cardozo (who has been litigating some of these issues for years), took our understanding of NSA excesses from one footnote in a FISA Court opinion, rather than from years of reading underlying documents.

Readers are likely aware of the incident, which has become a persistent reference point for NSA’s most ardent critics. One such critic recently pointed to a FISC memorandum referencing the episode as evidence that “NSA lawyers routinely lie, even to the secret rubber stamp FISA court”; another cited it in claiming DOJ’s attorneys made “misleading claims about the intent and knowledge NSA had about the phone and Internet dragnets” and that “NSA had basically willfully treated FISA-collected data under the more lenient protection regime of EO 12333.”

These allegations are false. And by insisting that government officials routinely mislead and lie, these critics are missing one of the most important stories in the history of modern intelligence oversight.

Never mind that I actually hadn’t cited the footnote. Never mind that then FISA Judge Reggie Walton was the first to espouse my “false” view, even before seven more months of evidence came out providing further support for it.

The underlying point is that these two NSA people were so angry that I called out Matt Olsen for documented actions he had taken that they used it as a foil to make some pretty problematic claims about the oversight over NSA spying. But before they did so, they assured us of the integrity of the people involved (that is, Olsen and others).

It’s tempting to respond to these accusations by defending the integrity of the individuals involved. After all, we know from firsthand experience that our former colleagues—both within the NSA and across the Department of Justice, the Office of the Director of National Intelligence, and the Department of Defense—serve the public with a high degree of integrity. But we think it is important to move beyond the focus on who is good and who is bad, and instead explore the history behind that footnote and the many lessons learned and incorporated into practice. After all, we are ultimately a “government of laws,” not of people.

 

 

We are a government of laws, not people, they said in October, before laying out oversight that (they don’t tell you, but I will once I finally get back to responding to this post) has already proven to be inadequate. I mean, I agree with their intent — that we need(ed) to build a bureaucracy that could withstand the craziest of Executives. But contrary to what they claim in their piece and the presumably best intent of DeLong, they didn’t do that.

They now seem to realize that.

In the wake of the Trump victory, a number of these people are now admitting that maybe their reassurances about the bureaucracy they contributed to — which were in reality based on faith in the good intentions and honesty and competence of their colleagues — were overstated. Maybe these tools are too dangerous for an unhinged man to wield.

And, it turns out, one of the people largely responsible for expanding the dragnet that its former defenders now worry might be dangerous for Donald Trump to control never even imagined that someone like Trump might come along.

The Evidence to Prove the Russian Hack

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In this post, I’m going to lay out the evidence needed to fully explain the Russian hack. I think it will help to explain some of the timing around the story that the CIA believes Russia hacked the DNC to help win Trump win the election, as well as what is new in Friday’s story. I will do rolling updates on this and eventually turn it into a set of pages on Russia’s hacking.

As I see it, intelligence on all the following are necessary to substantiate some of the claims about Russia tampering in this year’s election.

  1. FSB-related hackers hacked the DNC
  2. GRU-related hackers hacked the DNC
  3. Russian state actors hacked John Podesta’s emails
  4. Russian state actors hacked related targets, including Colin Powell and some Republican sites
  5. Russian state actors hacked the RNC
  6. Russian state actors released information from DNC and DCCC via Guccifer 2
  7. Russian state actors released information via DC Leaks
  8. Russian state actors or someone acting on its behest passed information to Wikileaks
  9. The motive explaining why Wikileaks released the DNC and Podesta emails
  10. Russian state actors probed voter registration databases
  11. Russian state actors used bots and fake stories to make information more damaging and magnify its effects
  12. The level at which all Russian state actors’ actions were directed and approved
  13. The motive behind the actions of Russian state actors
  14. The degree to which Russia’s efforts were successful and/or primary in leading to Hillary’s defeat

I explain all of these in more detail below. For what it’s worth, I think there was strong publicly available information to prove 3, 4, 7, 11. I think there is weaker though still substantial information to support 2. It has always been the case that the evidence is weakest at point 6 and 8.

At a minimum, to blame Russia for tampering with the election, you need high degree of confidence that GRU hacked the DNC (item 2), and shared those documents via some means with Wikileaks (item 8). What is new about Friday’s story is that, after months of not knowing how the hacked documents got from Russian hackers to Wikileaks, CIA now appears to know that people close to the Russian government transferred the documents (item 8). In addition, CIA now appears confident that all this happened to help Trump win the presidency (item 13).

1) FSB-related hackers hacked the DNC

The original report from Crowdstrike on the DNC hack actually said two separate Russian-linked entities hacked the DNC: one tied to the FSB, which it calls “Cozy Bear” or APT 29, and one tied to GRU, which it calls “Fancy Bear” or APT 28. Crowdstrike says Cozy Bear was also responsible for hacks of unclassified networks at the White House, State Department, and US Joint Chiefs of Staff.

I’m not going to assess the strength of the FSB evidence here. As I’ll lay out, the necessary hack to attribute to the Russians is the GRU one, because that’s the one believed to be the source of the DNC and Podesta emails. The FSB one is important to keep in mind, as it suggests part of the Russian government may have been hacking US sites solely for intelligence collection, something our own intelligence agencies believe is firmly within acceptable norms of spying. In the months leading up to the 2012 election, for example, CIA and NSA hacked the messaging accounts of a bunch of Enrique Peña Nieto associates, pretty nearly the equivalent of the Podesta hack, though we don’t know what they did with that intelligence. The other reason to keep the FSB hack in mind is because, to the extent FSB hacked other sites, they also may be deemed part of normal spying.

2) GRU-related hackers hacked the DNC

As noted, Crowdstrike reported that GRU also hacked the DNC. As it explains, GRU does this by sending someone something that looks like an email password update, but which instead is a fake site designed to get someone to hand over their password. The reason this claim is strong is because people at the DNC say this happened to them.

Note that there are people who raise questions of whether this method is legitimately tied to GRU and/or that the method couldn’t be stolen and replicated. I will deal with those questions at length elsewhere. But for the purposes of this post, I will accept that this method is a clear sign of GRU involvement. There are also reports that deal with GRU hacking that note high confidence GRU hacked other entities, but less direct evidence they hacked the DNC.

Finally, there is the real possibility that other people hacked the DNC, in addition to FSB and GRU. That possibility is heightened because a DNC staffer was hacked via what may have been another method, and because DNC emails show a lot of password changes off services for which DNC staffers had had their accounts exposed in other hacks.

All of which is a way of saying, there is some confidence that DNC got hacked at least twice, with those two revealed efforts being done by hackers with ties to the Russian state.

3) Russian state actors (GRU) hacked John Podesta’s emails

Again, assuming that the fake Gmail phish is GRU’s handiwork, there is probably the best evidence that GRU hacked John Podesta and therefore that Russia, via some means, supplied Wikileaks, because we have a copy of the actual email used to hack him. The Smoking Gun has an accessible story describing how all this works. So in the case of Podesta, we know he got a malicious phish email, we know that someone clicked the link in the email, and we know that emails from precisely that time period were among the documents shared with Wikileaks. We just have no idea how they got there.

4) Russian state actors hacked related targets, including some other Democratic staffers, Colin Powell and some Republican sites

That same Gmail phish was used with victims — including at a minimum William Rinehart and Colin Powell — that got exposed in a site called DC Leaks. We can have the same high degree of confidence that GRU conducted this hack as we do with Podesta. As I note below, that’s more interesting for what it tells us about motive than anything else.

5) Russian state actors hacked the RNC

The allegation that Russia also hacked the RNC, but didn’t leak those documents — which the CIA seems to rely on in part to argue that Russia must have wanted to elect Trump — has been floating around for some time. I’ll return to what we know of this. RNC spox Sean Spicer is denying it, though so did Hillary’s people at one point deny that they had been hacked.

There are several points about this. First, hackers presumed to be GRU did hack and release emails from Colin Powell and an Republican-related server. The Powell emails (including some that weren’t picked up in the press), in particular, were detrimental to both candidates. The Republican ones were, like a great deal of the Democratic ones, utterly meaningless from a news standpoint.

So I don’t find this argument persuasive in its current form. But the details on it are still sketchy precisely because we don’t know about that hack.

6) Russian state actors released information from DNC and DCCC via Guccifer 2

Some entity going by the name Guccifer 2 started a website in the wake of the announcement that the DNC got hacked. The site is a crucial part of this assessment, both because it released DNC and DCCC documents directly (though sometimes misattributing what it was releasing) and because Guccifer 2 stated clearly that he had shared the DNC documents with Wikileaks. The claim has always been that Guccifer 2 was just a front for Russia — a way for them to adopt plausible deniability about the DNC hack.

That may be the case (and obvious falsehoods in Guccifer’s statements make it clear deception was part of the point), but there was always less conclusive (and sometimes downright contradictory) evidence to support this argument (this post summarizes what it claims are good arguments that Guccifer 2 was a front for Russia; on the most part I disagree and hope to return to it in the future). Moreover, this step has been one that past reporting said the FBI couldn’t confirm. Then there are other oddities about Guccifer’s behavior, such as his “appearance” at a security conference in London, or the way his own production seemed to fizzle as Wikileaks started releasing the Podesta emails. Those details of Guccifer’s behavior are, in my opinion, worth probing for a sense of how all this was orchestrated.

Yesterday’s story seems to suggest that the spooks have finally figured out this step, though we don’t have any idea what it entails.

7) Russian state actors released information via DC Leaks

Well before many people realized that DC Leaks existed, I suspected that it was a Russian operation. That’s because two of its main targets — SACEUR Philip Breedlove and George Soros — are targets Russia would obviously hit to retaliate for what it treats as a US-backed coup in Ukraine.

DC Leaks is also where the publicly released (and boring) GOP emails got released.

Perhaps most importantly, that’s where the Colin Powell emails got released (this post covers some of those stories). That’s significant because Powell’s emails were derogatory towards both candidates (though he ultimately endorsed Hillary).

It’s interesting for its haphazard targeting (if someone wants to pay me $$ I would do an assessment of all that’s there, because some just don’t make any clear sense from a Russian perspective, and some of the people most actively discussing the Russian hacks have clearly not even read all of it), but also because a number of the victims have been affirmatively tied to the GRU phishing methods.

So DC Leaks is where you get obvious Russian targets and Russian methods all packaged together. But of the documents it released, the Powell emails were the most interesting for electoral purposes, and they didn’t target Hillary as asymmetrically as the Wikileaks released documents did.

8) Russian state actors or someone acting on its behest passed information to Wikileaks

The basis for arguing that all these hacks were meant to affect the election is that they were released via Wikileaks. That is what was supposed to be new, beyond just spying (though we have almost certainly hacked documents and leaked them, most probably in the Syria Leaks case, but I suspect also in some others).

And as noted, how Wikileaks got two separate sets of emails has always been the big question. With the DNC emails, Guccifer 2 clearly said he had given them to WL, but the Guccifer 2 ties to Russia was relatively weak. And with the Podesta emails, I’m not aware of any known interim step between the GRU hack and Wikileaks.

A late July report said the FBI was still trying to determine how Russia got the emails to Wikileaks or even if they were the same emails.

The FBI is still investigating the DNC hack. The bureau is trying to determine whether the emails obtained by the Russians are the same ones that appeared on the website of the anti-secrecy group WikiLeaks on Friday, setting off a firestorm that roiled the party in the lead-up to the convention.

The FBI is also examining whether APT 28 or an affiliated group passed those emails to WikiLeaks, law enforcement sources said.

An even earlier report suggested that the IC wasn’t certain the files had been passed electronically.

And the joint DHS/ODNI statement largely attributed its confidence that Russia was involved in the the leaking (lumping Guccifer 2, DC Leaks, and Wikileaks all together) not because it had high confidence in that per se (a term of art saying, effectively, “we have seen the evidence”), but instead because leaking such files is consistent with what Russia has done elsewhere.

The recent disclosures of alleged hacked e-mails on sites like DCLeaks.com and WikiLeaks and by the Guccifer 2.0 online persona are consistent with the methods and motivations of Russian-directed efforts.

Importantly, that statement came out on October 7, so well after the September briefing at which CIA claimed to have further proof of all this.

Now, Julian Assange has repeatedly denied that Russia was his source. Craig Murray asserted, after having meeting with Assange, that the source is not the Russian state or a proxy. Wikileaks’ tweet in the wake of yesterday’s announcement — concluding that an inquiry directed at Russia in this election cycle is targeted at Wikileaks — suggests some doubt. Also, immediately after the election, Sergei Markov, in a statement deemed to be consistent with Putin’s views, suggested that “maybe we helped a bit with WikiLeaks,” even while denying Russia carried out the hacks.

That’s what’s new in yesterday’s story. It stated that “individuals with connections to the Russian government” handed the documents to Wikileaks.

Intelligence agencies have identified individuals with connections to the Russian government who provided WikiLeaks with thousands of hacked emails from the Democratic National Committee and others, including Hillary Clinton’s campaign chairman, according to U.S. officials. Those officials described the individuals as actors known to the intelligence community and part of a wider Russian operation to boost Trump and hurt Clinton’s chances.

[snip]

[I]ntelligence agencies do not have specific intelligence showing officials in the Kremlin “directing” the identified individuals to pass the Democratic emails to WikiLeaks, a second senior U.S. official said. Those actors, according to the official, were “one step” removed from the Russian government, rather than government employees. Moscow has in the past used middlemen to participate in sensitive intelligence operations so it has plausible deniability.

I suspect we’ll hear more leaked about these individuals in the coming days; obviously, the IC says it doesn’t have evidence of the Russian government ordering these people to share the documents with Wikileaks.

Nevertheless, the IC now has what it didn’t have in July: a clear idea of who gave Wikileaks the emails.

9) The motive explaining why Wikileaks released the DNC and Podesta emails

There has been a lot of focus on why Wikileaks did what it did, which notably includes timing the DNC documents to hit for maximum impact before the Democratic Convention and timing the Podesta emails to be a steady release leading up to the election.

I don’t rule out Russian involvement with all of that, but it is entirely unnecessary in this case. Wikileaks has long proven an ability to hype its releases as much as possible. More importantly, Assange has reason to have a personal gripe against Hillary, going back to State’s response to the cable release in 2010 and the subsequent prosecution of Chelsea Manning.

In other words, absent really good evidence to the contrary, I assume that Russia’s interests and Wikileaks’ coincided perfectly for this operation.

10) Russian state actors probed voter registration databases

Back in October, a slew of stories reported that “Russians” had breached voter related databases in a number of states. The evidence actually showed that hackers using a IP tied to Russia had done these hacks. Even if the hackers were Russian (about which there was no evidence in the first reports), there was also no evidence the hackers were tied to the Russian state. Furthermore, as I understand it, these hacks used a variety of methods, some or all of which aren’t known to be GRU related. A September DHS bulletin suggested these hacks were committed by cybercriminals (in the past, identity thieves have gone after voter registration lists). And the October 7 DHS/ODNI statement affirmatively said the government was not attributing the probes to the Russians.

Some states have also recently seen scanning and probing of their election-related systems, which in most cases originated from servers operated by a Russian company. However, we are not now in a position to attribute this activity to the Russian Government.

In late November, an anonymous White House statement said there was no increased malicious hacking aimed at the electoral process, though remains agnostic about whether Russia ever planned on such a thing.

The Federal government did not observe any increased level of malicious cyber activity aimed at disrupting our electoral process on election day. As we have noted before, we remained confident in the overall integrity of electoral infrastructure, a confidence that was borne out on election day. As a result, we believe our elections were free and fair from a cybersecurity perspective.

That said, since we do not know if the Russians had planned any malicious cyber activity for election day, we don’t know if they were deterred from further activity by the various warnings the U.S. government conveyed.

Absent further evidence, this suggests that reports about Russian trying to tamper with the actual election infrastructure were at most suspicions and possibly just a result of shoddy reporting conflating Russian IP with Russian people with Russian state.

11) Russian state actors used bots and fake stories to make information more damaging and magnify its effects

Russia has used bots and fake stories in the past to distort or magnify compromising information. There is definitely evidence some pro-Trump bots were based out of Russia. RT and Sputnik ran with inflammatory stories. Samantha Bee famously did an interview with some Russians who were spreading fake news. But there were also people spreading fake news from elsewhere, including Macedonia and Surburban LA. A somewhat spooky guy even sent out fake news in an attempt to discredit Wikileaks.

As I have argued, the real culprit in this economy of clickbait driven outrage is closer to home, in the algorithms that Silicon Valley companies use that are exploited by a whole range of people. So while Russian directed efforts may have magnified inflammatory stories, that was not a necessary part of any intervention in the election, because it was happening elsewhere.

12) The level at which all Russian state actors’ actions were directed and approved

The DHS/ODNI statement said clearly that “We believe, based on the scope and sensitivity of these efforts, that only Russia’s senior-most officials could have authorized these activities.” But the WaPo story suggests they still don’t have proof of Russia directing even the go-between who gave WL the cables, much less the go-between directing how Wikileaks released these documents.

Mind you, this would be among the most sensitive information, if the NSA did have proof, because it would be collection targeted at Putin and his top advisors.

13) The motive behind the actions of Russian state actors

The motive behind all of this has varied. The joint DHS/ODNI statement said it was “These thefts and disclosures are intended to interfere with the US election process.” It didn’t provide a model for what that meant though.

Interim reporting — including the White House’s anonymous post-election statement — had suggested that spooks believed Russia was doing it to discredit American democracy.

The Kremlin probably expected that publicity surrounding the disclosures that followed the Russian Government-directed compromises of e-mails from U.S. persons and institutions, including from U.S. political organizations, would raise questions about the integrity of the election process that could have undermined the legitimacy of the President-elect.

At one level, that made a lot of sense — the biggest reason to release the DNC and Podesta emails, it seems to me, was to confirm the beliefs a lot of people already had about how power works. I think one of the biggest mistakes of journalists who have political backgrounds was to avoid discussing how the sausage of politics gets made, because this material looks worse if you’ve never worked in a system where power is about winning support. All that said, there’s nothing in the emails (especially given the constant release of FOIAed emails) that uniquely exposed American democracy as corrupt.

All of which is to say that this explanation never made any sense to me; it was mostly advanced by people who live far away from people who already distrust US election systems, who ignored polls showing there was already a lot of distrust.

Which brings us to the other thing that is new in the WaPo story: the assertion that CIA now believes this was all intended to elect Trump, not just make us distrust elections.

The CIA has concluded in a secret assessment that Russia intervened in the 2016 election to help Donald Trump win the presidency, rather than just to undermine confidence in the U.S. electoral system, according to officials briefed on the matter.

[snip]

“It is the assessment of the intelligence community that Russia’s goal here was to favor one candidate over the other, to help Trump get elected,” said a senior U.S. official briefed on an intelligence presentation made to U.S. senators. “That’s the consensus view.”

For what it’s worth, there’s still some ambiguity in this. Did Putin really want Trump? Or did he want Hillary to be beat up and weak for an expected victory? Did he, like Assange, want to retaliate for specific things he perceived Hillary to have done, in both Libya, Syria, and Ukraine? That’s unclear.

14) The degree to which Russia’s efforts were successful and/or primary in leading to Hillary’s defeat

Finally, there’s the question that may explain Obama’s reticence about this issue, particularly in the anonymous post-election statement from the White House, which stated that the “election results … accurately reflect the will of the American people.” It’s not clear that Putin’s intervention, whatever it was, had anywhere near the effect as (for example) Jim Comey’s letters and Bret Baier’s false report that Hillary would be indicted shortly. There are a lot of other factors (including Hillary’s decision to ignore Jake Sullivan’s lonely advice to pay some attention to the Rust Belt).

And, as I’ve noted repeatedly, it is no way the case that Vladimir Putin had to teach Donald Trump about kompromat, the leaking of compromising information for political gain. Close Trump associates, including Roger Stone (who, by the way, may have had conversations with Julian Assange), have been rat-fucking US elections since the time Putin was in law school.

But because of the way this has rolled out (and particularly given the cabinet picks Trump has already made), it will remain a focus going forward, perhaps to the detriment of other issues that need attention.

Unpacking the New CIA Leak: Don’t Ignore the Aluminum Tube Footnote

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This post will unpack the leak from the CIA published in the WaPo tonight.

Before I start with the substance of the story, consider this background. First, if Trump comes into office on the current trajectory, the US will let Russia help Bashar al-Assad stay in power, thwarting a 4-year effort on the part of the Saudis to remove him from power. It will also restructure the hierarchy of horrible human rights abusing allies the US has, with the Saudis losing out to other human rights abusers, potentially up to and including that other petrostate, Russia. It will also install a ton of people with ties to the US oil industry in the cabinet, meaning the US will effectively subsidize oil production in this country, which will have the perhaps inadvertent result of ensuring the US remains oil-independent even though the market can’t justify fracking right now.

The CIA is institutionally quite close with the Saudis right now, and has been in charge of their covert war against Assad.

This story came 24 days after the White House released an anonymous statement asserting, among other things, “the Federal government did not observe any increased level of malicious cyber activity aimed at disrupting our electoral process on election day,” suggesting that the Russians may have been deterred.

This story was leaked within hours of the time the White House announced it was calling for an all-intelligence community review of the Russia intelligence, offered without much detail. Indeed, this story was leaked and published as an update to that story.

Which is to say, the CIA and/or people in Congress (this story seems primarily to come from Democratic Senators) leaked this, apparently in response to President Obama’s not terribly urgent call to have all intelligence agencies weigh in on the subject of Russian influence, after weeks of Democrats pressuring him to release more information. It was designed to both make the White House-ordered review more urgent and influence the outcome.

So here’s what that story says.

In September, the spooks briefed “congressional leaders” (which for a variety of reasons I wildarseguess is either a Gang of Four briefing including Paul Ryan, Nancy Pelosi, Mitch McConnell, and Harry Reid or a briefing to SSCI plus McConnell, Reid, Jack Reed, and John McCain). Apparently, the substance of the briefing was that Russia’s intent in hacking Democratic entities was not to increase distrust of institutions, but instead to elect Trump.

The CIA has concluded in a secret assessment that Russia intervened in the 2016 election to help Donald Trump win the presidency, rather than just to undermine confidence in the U.S. electoral system, according to officials briefed on the matter.

The difference between this story and other public assessments is that it seems to identify the people — who sound like people with ties to the Russian government but not necessarily part of it — who funneled documents from Russia’s GRU to Wikileaks.

Intelligence agencies have identified individuals with connections to the Russian government who provided WikiLeaks with thousands of hacked emails from the Democratic National Committee and others, including Hillary Clinton’s campaign chairman, according to U.S. officials. Those officials described the individuals as actors known to the intelligence community and part of a wider Russian operation to boost Trump and hurt Clinton’s chances.

[snip]

[I]ntelligence agencies do not have specific intelligence showing officials in the Kremlin “directing” the identified individuals to pass the Democratic emails to WikiLeaks, a second senior U.S. official said. Those actors, according to the official, were “one step” removed from the Russian government, rather than government employees.

This is the part that has always been missing in the past: how the documents got from GRU, which hacked the DNC and John Podesta, to Wikileaks, which released them. It appears that CIA now thinks they know the answer: some people one step removed from the Russian government, funneling the documents from GRU hackers (presumably) to Wikileaks to be leaked, with the intent of electing Trump.

Not everyone buys this story. Mitch McConnell doesn’t buy the intelligence.

In September, during a secret briefing for congressional leaders, Senate Republican Leader Mitch McConnell (Ky.) voiced doubts about the veracity of the intelligence, according to officials present.

That’s one doubt raised about CIA’s claim — though like you all, I assume Mitch McConnell shouldn’t be trusted on this front.

But McConnell wasn’t the only one. One source for this story — which sounds like someone like Harry Reid or Dianne Feinstein — claimed that this CIA judgment is the “consensus” view of all the intelligence agencies, a term of art.

“It is the assessment of the intelligence community that Russia’s goal here was to favor one candidate over the other, to help Trump get elected,” said a senior U.S. official briefed on an intelligence presentation made to U.S. senators. “That’s the consensus view.”

Except that in a briefing this week (which may have been what impressed John McCain and Lindsey Graham to do their own investigation), that’s not what this represented.

The CIA shared its latest assessment with key senators in a closed-door briefing on Capitol Hill last week, in which agency officials cited a growing body of intelligence from multiple sources. Agency briefers told the senators it was now “quite clear” that electing Trump was Russia’s goal, according to the officials, who spoke on the condition of anonymity to discuss intelligence matters.

The CIA presentation to senators about Russia’s intentions fell short of a formal U.S. assessment produced by all 17 intelligence agencies. A senior U.S. official said there were minor disagreements among intelligence officials about the agency’s assessment, in part because some questions remain unanswered. [my emphasis]

That’s a conflict. Some senior US official (often code for senior member of Congress) says this is the consensus view. Another senior US official (or maybe the very same one) says there are “minor disagreements.”

Remember: we went to war against Iraq, which turned out to have no WMD, in part because no one read the “minor disagreements” from a few agencies about some aluminum tubes. A number of Senators who didn’t read that footnote closely (and at least one that did) are involved in this story. What we’re being told is there are some aluminum tube type disagreements.

Let’s hear about those disagreements this time, shall we?

Here’s the big takeaway. The language “a formal US assessment produced by all 17 intelligence agencies” is, like “a consensus view,” a term of art. It’s an opportunity for agencies which may have differing theories of what happened here to submit their footnotes.

That may be what Obama called for today: the formal assessment from all agencies (though admittedly, the White House purposely left the scope and intent of it vague).

Whatever that review is intended to be, what happened as soon as Obama announced it is that the CIA and/or Democratic Senators started leaking their conclusion. That’s what this story is.

Update: One other really critical detail. When the White House announced the Obama review today, Wikileaks made what was a bizarre statement. Linking to a CNN story on the Obama ordered review that erred on the side of blaming Russia for everything, it said, “CNN: Obama orders report into WikiLeaks timed for release just prior to Trump presidency.” Even though none of the statements on the review focused on what this story does — that is, on the way that the DNC and Podesta emails got to Wikileaks — Wikileaks nevertheless interpreted it as an inquiry targeted at it.

Update: And now David Sanger (whose story on the Obama-ordered review was particularly bad) and Scott Shane reveal the RNC also got hacked, and it is the differential leaking that leads the spooks to believe the Russians wanted Trump to win.

They based that conclusion, in part, on another finding — which they say was also reached with high confidence — that the Russians hacked the Republican National Committee’s computer systems in addition to their attacks on Democratic organizations, but did not release whatever information they gleaned from the Republican networks.

In the months before the election, it was largely documents from Democratic Party systems that were leaked to the public.

This may be a fair assessment. But you would have to account for two things before making it. First, you’d need to know the timing and hacker behind the RNC hack. That’s because two entities are believed to have hacked the DNC: an FSB appearing hacking group, and a GRU one. The FSB is not believed to have leaked. GRU is believed to have. So if the FSB hacked the RNC but didn’t leak it, it would be completely consistent with what FSB did with DNC.

NYT now says the RNC hack was by GRU in the spring, so it is a fair question why the DNC things got leaked but RNC did not.

Also, Sanger and Shane say “largely documents” from Dems were leaked. That’s false. There were two streams of non-Wikileaks releases, Guccifer, which did leak all-Dem stuff, and DC Leaks, which leaked stuff that might be better qualified as Ukrainian related. The most publicized of documents from the latter were from Colin Powell, which didn’t help Trump at all.

Update: It’s clear that Harry Reid (who of course is retiring and so can leak speech and debate protected classified information without worrying he’ll be shut off in the future) is one key driver of this story. Last night he was saying, “”I was right. Comey was wrong. I hope he can look in the mirror and see what he did to this country.” This morning he is on the TV saying he believes Comey had information on this before the election.

Update, 12/10: This follow-up from WaPo is instructive, as it compares what CIA briefed the Senate Intelligence Committee about the current state of evidence with what FBI briefed the House Intelligence Committee about the current state of evidence. While the focus is on different Republican and Democratic understandings of both, the story also makes it clear that FBI definitely doesn’t back what WaPo’s sources from yesterday said was a consensus view.

Our Industrial Policy Is the F-35

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screen-shot-2016-12-01-at-10-14-03-am

Lockheed photo.

With the news of Donald Trump’s deal to keep 1,100 of 2,100 Carrier jobs in Indiana, coastal elites appear to have just discovered tax-supported Midwestern manufacturing jobs, even as they continue to ignore tax-supported defense contractor (manufacturing) jobs.

As best as I can understand it from the details released so far, the deal may be best understood as a mix of typical state-level efforts combined with the leverage of a federal level effort. Over 25% of the jobs saved will be engineer and headquarter jobs — important for retaining technological capacity in the US, but not a big help to blue collar workers.

The package is reportedly substantially similar to one IN Governor and soon to be Vice President Mike Pence already offered.

UTC agreed to retain approximately 800 manufacturing jobs at the Indiana plant that had been slated to move to Mexico, as well as another 300 engineering and headquarters jobs. In return, the company will get roughly $700,000 a year for a period of years in state tax incentives.

Some 1,300 jobs will still go to Mexico, which includes 600 Carrier employees, plus 700 workers from UTEC Controls in Huntington, Ind.

That has commentators on all sides — from economists to Bernie Sanders — complaining that Trump just made it more likely companies will demand bribes to retain US based jobs in the future.

That’s of course a fantasy. Companies already demand bribes to keep jobs in particular states (or in the US generally).* This is just a typical deal — indeed, it was a typical failed deal until the guy making it became Vice President-elect thanks in part to his new boss’ running on making a better deal.

The way companies arbitrage states and countries to get the best deal to preserve jobs is not a good thing — at all. But it’s one that must be solved at a systematic level, a point Jared Bernstein made in the WaPo.

This sort of production cannot be sustained as some sort of non-competitive museum model, where we push back on trade-induced job losses through tax breaks and government contracts. True, governors and mayors commonly dole out such goodies as bribes to factories to settle in one state vs. another, but that’s a zero-sum game, and often ends up as a big waste of precious resources. Meanwhile, it’s also a game of corporate whack-a-mole. While Trump et al. were brokering this deal, nearby factories were packing up for Mexico.

As I recently wrote, we’ve generally failed to even try to implement a solution to this problem of global competition eroding our manufacturing base. A systemic approach, as opposed to what Trump is up to here, will require reducing our trade deficit in manufactured goods by pushing back against countries that manage their currencies to make our exports expensive and their exports cheap. It will require investments in advanced manufacturing so we can close the wage gap with productivity. It will require systemic state and older city economic development of the type economist Tim Bartik describes here and here. It may require direct job creation to employ displaced workers when none of the above comes through.

The key twist on this story, however, is that Carrier was convinced to deal when Trump started threatening that federal contracts with Carrier’s parent company, United Technologies, might be at risk if they didn’t.

John Mutz, a former Indiana lieutenant governor who sits on the [Indiana Economic Development Corporation’s] 12-member board, told POLITICO that Carrier turned down a previous offer from IEDC before the election. He said he thinks the choice is driven by concerns from Carrier’s parent company, United Technologies, that it could lose a portion of its roughly $6.7 billion in federal contracts.

“This deal is no different than other deals that we put together at the IEDC to retain jobs, but the fact is that the difference is that United Technologies depends on the federal government for lots of business,” Mutz said.

Kevin Drum — while citing a lot of health care and finance jobs (both heavily supported by federal policy) as the true job leaders in Indianapolis — considers the pressure on United Technologies to be an outrage.

This would be a massive abuse of power, of course, but who wants to take a chance that Trump cares? Probably not UT.

I actually think the deal ought to elicit a more interesting discussion of industrial policy — the kind of systematic intervention that Bernstein talks about that might actually do something about the hollowing out of America’s manufacturing base.

Such a discussion has long been forbidden in American political discourse, in part because the same economists pretending such whack-a-mole bribes haven’t become the norm in American political life also pretend that an unfettered “free” market (always defined to include mobile capital and goods, but not labor) will benefit everyone.

Yet even during the period when any discussion of industrial policy has been forbidden, we’ve had one.

Our industrial policy consists of massive US investments in manufacturing war and intelligence toys that we then sell to foreign governments. When done with Middle Eastern petro-states like Saudi Arabia, that trade goes a long way to equalize our foreign trade deficit, but it contributes directly to instability that then requires us to intervene and build more war toys. That investment in war leads, in turn, to a disinvestment in publicly funded infrastructure that could also provide jobs in the heartland.

The most obvious symbol of our unacknowledged industrial policy is the F-35, a trillion dollar federal investment for a plane that has yet to meet basic requirements, one beset by years of rework. As it happens, one of many causes of problems with the F-35 is big reliability problems with engines used in the plane. That makes those faulty engines, made by United Technologies subsidiary Pratt & Whitney, just another direct taxpayer investment in UTC jobs. Yet reliability problems didn’t prevent P&W from getting another contract for the F-35 engine earlier this year. Nor did P & W’s provision of attack helicopter technology to the Chinese via a Canadian subsidiary.

Our current industrial policy, you see, feeds so few prime contractors that they are virtually immune from the competition that might pressure them to deliver quality goods. Which leads, in turn, to rework, contract overruns, and contractors walking out of the building with our government’s most closely guarded secrets, all with no consequences.

Let’s stop pretending (as this piece does) that America’s manufacturing, increasingly dominated by the production of war toys, exists in a a real market, shall we?

Once we do that, we might begin to address the diseases of our defense contracting and — more importantly — rediscover the value of investing in other kinds of manufacturing that our country needs to have. Justify these investments by some future defense need, I don’t give a damn (though there are military officials who will soberly explain the risks of the hollowing out of our manufacturing base). But invest in the technologies the US needs to stay competitive and retain a manufacturing base.

There was a brief moment when Obama tried to do this by investing in battery factories in MI and other Rust Belt states, an investment justified because the US lagged so far behind South Korea on this critical technology. The investments were badly executed, and then later undermined by the KORUS trade deal. Republicans made them toxic with the Solyndra faux scandal. And so, rather than siting one after another killer app in locales whose older economies had failed, such efforts largely ended.

Imagine how the climate change negotiations might have changed, though, if they came with key investments in alternative energies in coal mining areas of West Virginia and Kentucky?

But this Carrier deal — no matter how much of a gimmick — should be an opportunity to shift the discussion. Trump (and Pence) just federalized the kind of deal every state makes out of desperation, pitting states against each other and Mexico and China. If they can do that, in part by leveraging federal contracting, then they can also pursue an honest industrial policy, one not dependent on selling war toys to our belligerent authoritarian friends overseas.

I doubt Trump will do that. But his Carrier deal ought to at least invite a debate about it.

Update: Added a link to the deferred prosecution for when Pratt & Whitney dodged export restrictions to provide technology to China.

Update: The other day Bloomberg did a review of the Department of Energy’s Loan Program Office, which funded Solyndra (but which, as was covered at the time, actually dates to W’s Administration) actually has been very successful.

Not only has the program’s loan portfolio generated about $1.65 billion in interest payments to date, its mission to support major energy projects fits into Trump’s goal of stimulating investment in the U.S., said Jonathan Silver, a former head of the loan programs office.

“The President-elect was talking directly about significant investments in infrastructure,” Silver said in an interview Monday at Bloomberg headquarters in New York. The program is intended to support not just clean-energy projects, but also industries Trump championed during the campaign, including coal, among other advanced fossil fuels. “This is infrastructure. It doesn’t get any more infrastructure-ish than this.”

The office dates to the George W. Bush administration and was designed to offer loan guarantees to innovative energy projects that struggle to get financing from commercial and investment banks. In some cases it also approved loans funded through the Federal Financing Bank.

It supported the first big solar farms in the country and helped commercialize solar-thermal systems, advanced nuclear designs, molten-salt storage and other technologies. It has yet to finance an advanced fossil-fuel project.

*Disclosure: My spouse works for a manufacturing company often touted, locally and nationally, as a huge success; it receives state tax credits.

The Blame Comey Movement

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screen-shot-2016-11-11-at-4-49-34-pmThere is a big rush from commentators on all sides to blame Jim Comey for the election result. And while normally I’m happy to blame Comey for things, I’m not convinced we have data to support that claim here, at least not yet.

The claim comes from two places. First, this description of how Trump’s analysts responded after discovering rural whites were voting at higher rates than expected.

Trump’s analysts had detected this upsurge in the electorate even before FBI Director James Comey delivered his Oct. 28 letter to Congress announcing that he was reopening his investigation into Clinton’s e-mails. But the news of the investigation accelerated the shift of a largely hidden rural mass of voters toward Trump.

Inside his campaign, Trump’s analysts became convinced that even their own models didn’t sufficiently account for the strength of these voters. “In the last week before the election, we undertook a big exercise to reweight all of our polling, because we thought that who [pollsters] were sampling from was the wrong idea of who the electorate was going to turn out to be this cycle,” says Matt Oczkowski, the head of product at London firm Cambridge Analytica and team leader on Trump’s campaign. “If he was going to win this election, it was going to be because of a Brexit-style mentality and a different demographic trend than other people were seeing.”

Trump’s team chose to focus on this electorate, partly because it was the only possible path for them. But after Comey, that movement of older, whiter voters became newly evident. It’s what led Trump’s campaign to broaden the electoral map in the final two weeks and send the candidate into states such as Pennsylvania, Wisconsin, and Michigan that no one else believed he could win (with the exception of liberal filmmaker Michael Moore, who deemed them “Brexit states”). [my emphasis]

And from this letter from Hillary’s pollster Navin Nayak.

We believe we lost this election in the last week. Comey’s letter in the last 11 days of the election both helped depress our turnout and also drove away some of our critical support among college-educated white voters — particularly in the suburbs. We also think Comey’s 2nd letter, which was intended to absolve Sec. Clinton, actually helped to bolster Trump’s turnout.

Navak is presumably the same person who missed the surge in rural areas that Trump was seeing, and therefore partly responsible for Clinton’s belated attention to MI and WI. No matter what caused surges in Trump’s support, not responding to it was a key reason for Hillary’s loss. So Navak has a big incentive to blame others.

After saying everything was going swimmingly in early turnout (without noting low African American turnout in that early vote), Navak tells this story about the last week.

But then everything changed in the last week.

Voters who decided in the last week broke for Trump by a larger margin (42-47). These numbers were even more exaggerated in the key battleground states.

There are two major events that happened in the last week:

Director Comey released his first letter 11 days out from the election, which likely helped to depress turnout among Hillary’s supporters. It made Sec. Clinton’s e-mail the focus of the campaign for half the remaining 10 days.

After seeing record early vote numbers, there was a significant drop in Election Day turnout, particularly among Hillary supporters, and this was noticeable in both larger cities such as Philadelphia, Raleigh-Durham, Milwaukee, Detroit and the suburbs surrounding these and other cities.

The two days before Election Day, Director Comey released a 2nd letter, which energized Trump supporters. [emphasis original]

What these two pieces — from Trump’s data analyst and Hillary’s pollster — suggest is a correlation between the Comey letter and Trump’s improved chances. But there’s no proof of causation — certainly not that Comey is the primary explanation.

Iscreen-shot-2016-11-11-at-5-21-22-pmn fact, temporally, the correlation is not perfect. Trump’s analysts say the trend started before the Comey letter. This was a weird election, but it is still highly unlikely that a letter released on October 28 can entirely explain a trend that started before October 28.

Navak is a lot squishier on timing. He says the trend happened in the last week. But of course, the letter (and the blizzard of press coverage) came out earlier than that. Precisely when did he see things start going south? He doesn’t say in his email but if it was really just the last week, then that timing doesn’t make sense either.

Then there’s the other detail that Navak does tell us: the move away from Hillary happened more in the “key battleground states.” That got me wondering why voters in key battleground states would be more responsive to Comey’s letter than voters in red or blue states.

screen-shot-2016-11-11-at-5-32-21-pmWhen I raised this on Twitter, a lot of people said swing state residents would be more bombarded with discussions about emails in the last two weeks. But aside from people who went to a Trump rally (which is admittedly thousands of people, though presumably hard core Trump supporters more than late deciders), they wouldn’t necessarily have. Trump’s final ad, which was very good and pretty reminiscent of Obama’s election ads, only referred to the emails once (albeit right at the beginning, just 5 seconds in), and even then only visually, appearing as Trump said “corrupt.” The emails were just one part of Trump’s larger narrative about a corrupt establishment. The rest of Trump’s ad played to economic anxieties, with dog whistles to anti-Semitism and xenophobia, but not the aggressive ones you’d see in his rallies.

Hillary’s final ad meanwhile (at the same link), was far weaker, basically just saying Trump is a dick but without naming him. So for those who decided based  on the content of these ads (I personally didn’t see many super PAC ads, though they may be a factor), the emails probably weren’t the deciding factor, the quasi-empowering message probably was more likely to have been.

And look at the data, above, from Nate Silver’s analysis. It is absolutely true that late-deciding voters in WI, MI, IA, PA, and FL went disproportionately for Trump. They did too in UT, which is unsurprising, but which is also a useful example because it suggests one of the other things people were doing in the last week: Deciding whether to vote a third party candidate, Evan McMullin, or not. Indeed, polling averages show that Trump’s late surge nationally came in conjunction with what was a longer, slower slide in Gary Johnson’s support. I think it’s possible that the emails affected people’s decision to vote third party or even among Republicans who might have voted for Hillary. But one thing that appears to partly explain Trump’s rise at the end is just a very typical decision among people who consider voting third party to in the end support the major candidate. Remember, too, that Trump’s aides had finally gotten him onto a script for these last days, so he was saying and doing fewer offensive things just as these late deciders decided.

Finally, look at those other swing states. In OH, the difference was much smaller. In NV, later breakers actually broke for Hillary. In GA that was even more pronounced.

Perhaps most interesting of all, however, is VA. VA — especially its northern suburbs where Hillary got most of her support — is packed with security clearance holders, precisely the kind of people who’ve expressed the most exasperation about a perceived double standard in the treatment of Hillary. Perhaps that sentiment, which I’ve seen expressed by individuals in a number of places — is overstated. Maybe some clearance holders who also understand overclassification aren’t as bugged by the email scandal as others. In any case, in VA, the state that probably has a higher chunk of clearance holders than any other, broke slightly for Hillary after the Comey letters. Why would Virginians treat the Comey letter so much differently than Wisconsonites and Michiganders?

One final thing. In the days after the first Comey letter, polls actually asked how much it would influence voters’ decision. One poll showed as many undecided voters saying it made no difference as those who said it did.

Thirty-nine percent of voters said the additional review of emails in the Clinton case had no bearing on their vote in November, while 33 percent it made them much less likely to vote for Clinton.

But most of those voters are already aligned against Clinton. Nearly two-thirds of Trump voters, 66 percent, said it makes them much less likely to vote against Clinton.

Among the small pocket of undecided voters remaining, 42 percent said it made them less likely to vote for Clinton, including 30 percent who said it made them much less likely to vote for her. But just as many, 41 percent, said it makes no difference either way.

In others, there was a bigger difference, even affecting Clinton supporters.

An ABC/Washington Post tracking survey released Sunday, conducted both before and after Comey’s letter was made public on Friday, found that about one-third of likely voters, including 7 percent of Clinton supporters, said the new e-mail revelations made them less likely to support the former secretary of state.

The poll found that Clinton received support from 46 percent of likely voters to Trump’s 45 percent, suggesting the race is a toss-up. That contrasts with the 12-point advantage that Clinton held in the same poll a week ago. Trump’s numbers have crept up, in part, as more Republicans have gotten behind their candidate.

A CBS tracking poll of likely voters in battleground states — the 13 states that could swing the Nov. 8 election — released on Sunday found that among voters overall, 71 percent say it either won’t change their thinking, or in some cases, they had already voted.

I’m not aware of any polls that asked about this after Comey’s second letter (and I’m somewhat baffled about how it could energize Trump voters in the way Navak claims), so it’s unclear how these numbers moved after she was re-exonerated.

The election was incredibly close. So if those 7% of Hillary voters who, the weekend after the first Comey letter, considered his announcement significant enough that it might decide their vote instead decided to stay home, it may well have been decisive. But we don’t have that data yet.

Let me close by emphasizing what I am not saying. I am not saying the email scandal didn’t affect the election at all. I am not saying that the press’ disproportionate coverage of it as opposed to Trump’s own corruption didn’t affect the election. Nor am I saying that the Comey letter definitively did not affect the election.

Rather, I’m just saying we don’t have proof that a somewhat inexact correlation between Trump’s late surge and the Comey letter was the cause of his late surge. I’m happy to be convinced otherwise. But right now I’m not seeing it.

Update: This David Plouffe analysis is worth reading in the context of this post for two reasons. First, he notes that Gary Johnson lost support primarily among his older supporters, but his younger supporters stayed with him. This means that his decline likely was tied to a Trump increase, and what remained did hurt Hillary disproportionately.

And here’s what he says about Comey.

JAMES COMEY From the last debate until Election Day, the dominant news was the F.B.I. and Mrs. Clinton’s emails along with a drumbeat of daily WikiLeaks dumps. Postelection research will help shed light here, but the small number of undecided voters at the end should have broken at least equally based on their demographic and voting history. If exit polls are accurate, they moved to Mr. Trump much more than to Mrs. Clinton in certain battleground states, and it’s quite possible the shadow created by the F.B.I. director was the major culprit. Oct. 19, the day of the final debate, was a long 20 days to Nov. 8, and the atmosphere was far from ideal for the Democratic candidate.

Update: On Twitter, Jamison Foser explained why the second letter would invigorate Trump’s supporters: because it fed the narrative that Hillary is corrupt and always gets away with it. That makes sense.

Another person pointed out that the differential impact in VA may be due to Tim Kaine’s influence, which is also a good explanation.