Obama Administration Mulls Over Ending Spying On Allied Nations In Wake Of NSA Scandal

From left, Sen. Dick Durbin, D-Ill., Sen. Charles Schumer, D-N.Y., President Barack Obama, Senate Majority Leader Harry Reid of Nev., Sen. Patty Murray, D-Wash., meet in the Oval Office of the White House, Saturday, Oct. 12, 2013, in Washington. The federal government remains partially shut down and faces a first-ever default between Oct. 17 and the end of the month. (AP Photo/Carolyn Kaster) (AP2013)

While it began with reports of spying on the administration of Brazilian President Dilma Rousseff, the National Security Agency spying scandal has picked up steam amid the most recent disclosure that the NSA was monitoring the communications of German Chancellor Angela Merkel.

Faced with a flood of revelations about U.S. spying practices, the White House is considering ending its eavesdropping on friendly foreign leaders, a senior administration official said.

A final decision has not been made and the move is still under review, the official said. But the fact that it is even being considered underscores the level of concern within the administration over the possible damage from the months-long spying scandal.

On Monday, Sen. Dianne Feinstein, chairwoman of the Senate Intelligence Committee, called for a "total review of all intelligence programs" following the Merkel allegations. In a statement, the California Democrat said the White House had informed her that "collection on our allies will not continue."

The administration official said that statement was not accurate, but added that some unspecified changes already had been made and more were being considered, including terminating the collection of communications from friendly heads of state.

The official was not authorized to discuss the review by name and insisted on anonymity.

Reports based on new leaks from former NSA systems analyst Edward Snowden indicate that the NSA listened to Merkel and 34 other foreign leaders.

"With respect to NSA collection of intelligence on leaders of U.S. allies — including France, Spain, Mexico and Germany — let me state unequivocally: I am totally opposed," Feinstein said. She added that the U.S. should not be "collecting phone calls or emails of friendly presidents and prime ministers" unless in an emergency with approval of the president.

In response to the revelations, German officials said Monday that the U.S. could lose access to an important law enforcement tool used to track terrorist money flows. Other longtime allies have also expressed their displeasure about the U.S. spying on their leaders.

As possible leverage, German authorities cited last week's non-binding resolution by the European Parliament to suspend a post-9/11 agreement allowing the Americans access to bank transfer data to track the flow of terrorist money. A top German official said Monday she believed the Americans were using the information to gather economic intelligence apart from terrorism and said the agreement, known as the SWIFT agreement, should be suspended.

European Union officials who are in Washington to meet with lawmakers ahead of White House talks said U.S. surveillance of their people could affect negotiations over a U.S.-Europe trade agreement. They said European privacy must be better protected.

Many officials in Germany and other European governments have made clear, however, that they don't favor suspending the U.S.-EU trade talks which began last summer because both sides stand to gain so much through the proposed deal, especially against competition from China and other emerging markets.

As tensions with European allies escalate, the top U.S. intelligence official declassified dozens of pages of top-secret documents in an apparent bid to show the NSA was acting legally when it gathered millions of Americans' phone records.

Director of National Intelligence James R. Clapper said he was following the president's direction to make public as much information as possible about how U.S. intelligence agencies spy under the Foreign Intelligence Surveillance Act. Monday's release of documents focused on Section 215 of the Patriot Act, which allows the bulk collection of U.S. phone records.

The document release is part of an administration-wide effort to preserve the NSA's ability to collect bulk data, which it says is key to tracking key terror suspects, but which privacy activists say is a breach of the Constitution's ban on unreasonable search and seizure of evidence from innocent Americans.

The release of the documents comes ahead of a House Intelligence Committee hearing Tuesday on FISA reform.

The documents support administration testimony that the NSA worked to operate within the law and fix errors when they or their systems overreached. One of the documents shows the NSA admitting to the House Intelligence Committee that one of its automated systems picked up too much telephone metadata. The February 2009 document indicates the problem was fixed.

Another set of documents shows the judges of the FISA court seemed satisfied with the NSA's cooperation. It says that in September 2009, the NSA advised the Senate Intelligence Committee about its continuing collection of Americans' phone records and described a series of demonstrations and briefings it conducted for three judges on the secretive U.S. spy court. The memorandum said the judges were "engaged throughout and asked questions, which were answered by the briefers and other subject matter experts," and said the judges appreciated the amount and quality of information the NSA provided.

It said that two days later, one of the judges, U.S. District Judge Reggie Walton, renewed the court's permission to resume collecting phone records.

The documents also included previously classified testimony from 2009 for the House Intelligence Committee by Michael Leiter, then head of the National Counterterrorism Center. He and other officials said collecting Americans' phone records helped indict Najibullah Zazi, who was accused in a previously disclosed 2009 terror plot to bomb the New York City subways.

The documents also show the NSA considered tracking targets using cellphone location data, and according to an April 2011 memo consulted the Justice Department first, which said such collection was legal. Only later did the NSA inform the FISA court of the testing.

NSA commander Gen. Keith Alexander revealed the testing earlier this month to Congress but said the agency did not use the capability to track Americans' cellphone locations nor deem it necessary right now.

Asked Monday whether the NSA intelligence gathering had been used not only to protect national security but American economic interests as well, White House spokesman Jay Carney said: "We do not use our intelligence capabilities for that purpose. We use it for security purposes."

National Security Council spokeswoman Caitlin Hayden later clarified that: "We do not use our intelligence capabilities to give U.S. companies an advantage, not ruling out that we are interested in economic information."

Still, he acknowledged the tensions with allies over the eavesdropping disclosures and said the White House was "working to allay those concerns," though he refused to discuss any specific reports or provide details of internal White House discussions.

Based on reporting by The Associated Press.