The 1980s saw NSA grow from more than fifty thousand military and civilian personnel to seventy-five thousand in 1989, twenty-five thousand of whom worked at NSA headquarters at Fort Meade. In terms of manpower alone, the agency was the largest component of the U.S. intelligence community by far, with a headquarters staff larger than the entire CIA.
As the agency’s size grew at a staggering pace, so did the importance of its intelligence reporting. The amount of reporting produced by NSA during the 1980s was astronomical. According to former senior American intelligence officials, on some days during the 1980s SIGINT accounted for over 70 percent of the material contained in the CIA’s daily intelligence report to President Reagan. Former CIA director (now Secretary of Defense) Robert Gates stated, “The truth is, until the late 1980s, U.S. signals intelligence was way out in front of the rest of the world.”
But NSA’s SIGINT efforts continued to produce less information because of a dramatic increase in worldwide telecommunications traffic volumes, which NSA had great difficulty coping with. It also had to deal with the growing availability and complexity of new telecommunications technologies, such as cheaper and more sophisticated encryption systems. By the late 1980s, the number of intercepted messages flowing into NSA headquarters at Fort Meade had increased to the point that the agency’s staff and computers were only able to process about 20 percent of the incoming materials.68These developments were to come close to making NSA deaf, dumb, and blind in the decade that followed.
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The invasion of Kuwait on August 2, 1990, by Iraq’s Saddam Hussein caught the U.S. intelligence community by surprise once again. In a familiar but worrisome pattern, intelligence indicating the possibility of the invasion was not properly analyzed or was discounted by senior Bush administration officials, including then–secretary of defense Dick Cheney, who did not think that Hussein would be foolish enough to do it. General Lee Butler, the commander of the Strategic Air Command, was later quoted as saying, “We had the warning from the intelligence community— we refused to acknowledge it.”
It took five months for the United States to move resources by land and sea to implement Desert Storm’s ground attack by three hundred thousand coalition troops.
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The worst threat to NSA’s fragile code-breaking capabilities came not from abroad but from a tiny computer software company in northern California called RSA Data Security, headed by Jim Bidzos. NSA was aware by the late 1980s that new encryption technologies being developed by private companies meant, according to a declassified internal NSA publication, that NSA’s code breakers were falling behind: “The underlying rate of cryptologic development throughout the world is faster than ever before and getting faster. Cryptologic literature in the public domain concerning advanced analytic techniques is proliferating. Inexpensive high-grade cryptographic equipment is readily accessible on the open market.” The agency was still able to break the cipher systems used by a small number of key countries around the world, such as Libya and Iran, but this could change quickly as target nations began using commercially available and rapidly evolving encryption software packages. It would have a catastrophic impact on the agency’s code-breaking efforts.
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But what was really killing NSA was the size of the agency’s payroll. Although the number of NSA personnel plummeted during McConnell’s tenure, the cost of paying those who remained skyrocketed as the agency had to reach deep into its pockets to try to keep its best and brightest from jumping ship and joining the dot-com boom. NSA stripped ever-increasing amounts of money from infrastructure improvement programs and its research and development efforts so that it could meet its payroll. It was left with little money to develop and build the new equipment desperately needed to access international communications traffic being carried by new and increasingly important telecommunications technologies, such as the Internet, cellular telephones, and fiber-optic cables. It was a decision that would, according to a former senior NSA official, “come back and bite us in the ass.”
More (#6) from The Secret Sentry:
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