Secretly green

• Daniel Flitton
• The Age, January 17, 2009
• http://www.theage.com.au/national/secretly-green-20090116-7j7i.html?page=-1

THE American president slumped down at her desk. "I guess the problem was that we counted on this not happening, at least not yet," she wrote in her diary. After the hurricane struck New York, the floods had been devastating. Thousands of people had been evacuated and plans to shift the world's richest stock exchange to a new and permanent home outside the city were well under way.

"Most scientists assumed the worst effects of climate change would occur later in the century," the president continued. "Still, enough warned there was always a chance of an extreme weather event coming sooner and, if it hit just right,

one of our big urban centres could be knocked out."

She marked the date at the top of the page: October 1, 2020.

This peek at a possible future is not the work of a leading fiction writer but a scenario painted in a high-level US intelligence report made public late last year. Titled Global Trends 2025, the report is a comprehensive attempt by top spy agencies to map out the likely transformation of world politics over the next few decades.

The mock presidential diary entry is a creative attempt to warn governments about the effects of global warming. It goes on to discuss potential ramifications for China and the world's poorer countries. Certainly, this is not a conventional type of intelligence report — but then again, climate change is not a conventional type of intelligence problem.

The usual expectation is that intelligence agencies focus on what might be termed "hard" topics — potential military build-ups, an impending coup in a near neighbour, foreign espionage or signs of terrorist activity.

But surprising though it might seem, climate change is precisely the kind of problem that is also ripe for intelligence assessment. As the world changes, so, too, does the role of intelligence.

Peter Varghese is in charge of Australia's foremost intelligence agency, the Office of National Assessments. He has spent the past five years looking into his metaphoric crystal ball to help inform Australia's political leaders of potential dangers.

During this time he has also had broad oversight of Australia's foreign intelligence community, including the Australian Secret Intelligence Service and the Defence Signals Directorate.

While about two-thirds of the intelligence community's operations are focused on terrorism and support for military deployments, Varghese is pleased to have seen its work on climate change developed. Taken as a whole, this has pushed the intelligence arena a lot closer to key decision-makers in government than at any time since Australia has been at war.

"Rewind 10 years and you wouldn't get that," he says.

But what contribution can secret intelligence make to a very public issue such as climate change?

In part, the answer lies in understanding the role of intelligence in formulating foreign and security policy. Decision makers always want answers but rarely have the luxury of sufficient information or time. So intelligence agencies are mandated with a specialised role — using technology, secret sources and the masses of material freely swirling around — to collect information and judge possible threats and emerging trends to better inform decisions.

Climate change has an intelligence dimension in that analysts seek to anticipate how foreign powers are likely to react to the problem — their likely approach to international negotiations to reduce greenhouse emissions, for example, or to the prospect of diminishing fresh water supplies in a particular territory. Will people be forced to abandon their homes, and where will they go? Will environmental degradation force countries to co-operate or to fight wars? The implications are as far reaching as the questions you can imagine.

A trained diplomat with more than 25 years in the foreign service, including a stint as high commissioner in Malaysia, Varghese also served as international adviser to former prime minister John Howard. He took on the job as director-general (or the "DeeGee", as he is known around the office) in January 2004 in the wake of unusually public controversies for the intelligence community, and the Office of National Assessments in particular: the children overboard affair and the high-profile resignation by an analyst to protest against the Iraq war.

Highly regarded across the public service, with a sharp mind, temperate nature and organised management approach, Varghese is precisely the kind of careful operator to flourish in a top secret environment.

He says he has sought to shift the balance of ONA reports away from what is likely to occur in the short term — that is, in the months ahead — to the medium and longer term. Issues that may not require an immediate response but are important over the horizon often present the hardest challenge for any country.

But intelligence ultimately remains an area for judgements, not clairvoyance. "We're dealing with bits of a jigsaw puzzle," he explains. "It is extremely rare to have access to the cover photo."

Put another way, if you collect a bunch of blue pieces together, they might look like part of a clear sky above. But there is no way to be completely sure they are not actually from a picture of the open sea. Intelligence is more often famous for its apparent failures than successes: failing to stop the September 11, 2001, terrorist attacks, for instance, or allegations Saddam Hussein had stockpiled weapons of mass destruction that later proved unfounded. It's a point Varghese readily concedes.

"No one is going to be infallible in this business," he says. "You are going to make a call and arrive at a lot of different positions. I'm more interested in knowing, was the call made with the right information?" To learn lessons, in other words.

In the Australian intelligence system, ONA is a small outfit examining political, strategic and economic matters abroad. Access to its "product", as its reports are known, is restricted to the uppermost echelons of government — the prime minister, other ministers on the National Security Committee of Cabinet, and the few top officials with a "need to know".

Set up 30 years ago, ONA has statutory independence, meaning the organisation is charged to make a call on issues as it sees fit and not be influenced by the policy preferences of the government of the day.

But Varghese is quick to explain this means intelligence agencies must also understand government priorities. The usually short and directly written reports should seek to inform the policy-making process, he says.

This leaves intelligence agencies open to criticism that the ideal of a strict dividing line between unbiased assessment and policy recommendations has eroded.

This type of criticism was particularly acute after the invasion of Iraq in 2003, when intelligence agencies were accused of tailoring reports to suit the intentions of politicians.

VARGHESE is not worried by suggestions that the close proximity to decision makers could compromise the goal of producing objective analysis. "I don't think that flows," he says, pointing to recent reviews of ONA's independence by the Inspector-General of Intelligence and Security, who has intrusive powers to look at the operations of all of Australia's spy agencies. The prime minister's department also conducts annual evaluations.

"They see the value of ONA product — but from my point of view, we make our own judgements about what would be useful," he says.

The value of intelligence has long been recognised by countries the world over, and somewhat paradoxically, the jealous walls that guard state secrets are breaking down in response to threats that shift across borders, particularly terrorism. The trade in secrets between Australia and the US is stronger than most. While the US intelligence apparatus dwarfs Australia's, according to Mark Lowenthal, a former senior CIA officer who has previously co-operated closely with Australia's counterparts, both sides benefit from the relationship.

"I think Australia produces some really good intelligence," Lowenthal says. "I think in some respects your analysis is much better than ours. What you call assessments are much better than our estimates. They're shorter, that alone is worth the price of admission," he jokes. "We write these desk-breaking tomes that slay whole forests — and go unread." (The Global Trends report came in at 100 pages, whereas Australia's rough equivalent, known as "national assessments", are capped at 10.)

This points to another growing challenge for intelligence agencies: how to make their product compelling in a world defined by massive gluts of information. Politicians can draw from any number of sources to inform their decision making — the media, business, academia, constituents, other parts of the bureaucracy — so why spend the estimated $1 billion the Australian Government devotes each year on intelligence agencies?

There is a further complication if assessment agencies are seen to be hedging their bets to avoid the embarrassment of making a judgement (such as in the case of Iraq's weapons of mass destruction) and getting it wrong.

Lowenthal despairingly tells of a time when the phrase "a small, but significant chance" of some event occurring was included in a draft report. Words such as "may", "could", "probably" are sometimes liberally sprinkled through reports to indicate uncertainty — but also give an escape clause if events turn out differently.

Varghese believes the culture of ONA encourages analysts to make judgements. But he also says there is little value in dealing with problems simplistically.

"We may write carefully, but our readers read quickly," he says, adding that it is important to be careful about the overall impression a report creates. "What will be the one or two things a reader will take out of this piece?"

He also insists that analysts constantly revisit their assumptions, and in the instances where a judgement changes, a fresh report explains why. It is the kind of practice that attempts to avoid past intelligence failures, such as missing the end of the Cold War and the collapse of the Soviet Union. With Prime Minister Kevin Rudd's pledge to set up a new intelligence college as a place where analytical craft can be refined, exactly these kind of issues can be further debated.

In the end, Varghese says, the quality of intelligence rests on judgements that are informed by expert intuition. "Analysts need thinking time — need more of it."

PETER VARGHESE CV

BORN Kenya, 1956.

EDUCATION Bachelor of arts (honours), University of Queensland.

OCCUPATION Director-general, Office of National Assessments, since 2004.

CAREER

1979 Joined Department of Foreign Affairs.

2000-02 Australian high commissioner to Malaysia

2002-03 Deputy secretary, Foreign Affairs Department.

2003 International adviser to the prime minister.

PERSONAL Married to Margaret O'Sullivan with one child.

HOBBIES Tennis, reading.

SOURCE: WHO'S WHO, AUSTRALIA

Daniel Flitton is diplomatic editor.