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John Kelly, former U.S. Ambassador to a war-ravaged Lebanon, may seem an unusual interview choice for a "software infrastructure guy" like me. However, because humankind's infrastructures can be as fragile and difficult to maintain as software infrastructures, the Ambassador is a perfect choice for a lively discussion. He is a terrorism expert — and one with firsthand experience. When I met him earlier this year, I knew that I had to interview him and focus our discussion on one simple question: "How should enterprises plan amid the fears of terrorism?" His answers, coming from his personal experiences in his many government roles, reassure us that terrorism is not a new, unknown challenge. However, his pointed comments also indicate that we as a society have much work to do before we can relegate terrorism to the waste bin it deserves. You will find only a token reference to technology in the interview; the majority of the advice is more universal — as it should be. Interview conducted 14 June and 15 July 2005
David McCoy: As Ambassador to Lebanon shortly after the 1983 U.S. Embassy bombing and the subsequent bombing of the Marine barracks, you were witness to one of the most critical examinations of terrorism the U.S. ever conducted. What did we learn from our examination of the actions of 1983? Ambassador John Kelly: I'm afraid we didn't learn as much as we should have, in that we eventually withdrew from Lebanon all our military forces and had a vestigial presence at the embassy. And the United States failed to take the measure of international terrorism and decide that it was going to be an — if not permanent — extraordinarily long-term threat, so that when the events leading up to and culminating on September 11, 2001, transpired, I don't think the U.S. was geared up to handle these things correctly. McCoy: What was the main failure there? Why did we not have better preparation and expectations for events like the USS Cole bombing or 9/11? Kelly: We weren't prepared for the Cole bombing because it was a different tactic. Car and truck bombs against an embassy or a military installation occurred repeatedly during the '80s and the '90s. And, every time it happened in a new country, we were surprised. We shouldn't have been. But in Lebanon, the American Embassy was blown up twice, the Marine barracks once, the French barracks once, the Iraqi Embassy once, and the American Embassies in Kuwait were attacked with a truck bomb. Later on in the '90s, the embassies in Tanzania and Kenya were blown up. A truck bomb was used at the Khobar Towers, where U.S. military forces were lodged in Saudi Arabia. Over and over again, these things happened because we had failed to secure the perimeters and put the physical measures into place that might protect us. I'm sure it's going to happen again, though the chances are probably a bit less because the United States government is now throwing billions of dollars in construction funding at the problems. But, it seems we have to learn everything over again. When we went into Iraq this time, we began to be surprised because our troops and some of the civilian workers there were being hit by booby traps — or "improvised explosive devices," as they're now called — along the roadways. This was standard in Lebanon. And we learned how to deal with them. But people change. A new generation comes along, and old lessons are often forgotten. McCoy: You said we're throwing billions of dollars at terrorism post-9/11. Do you think we've got most of the areas nailed down? Or are there still areas that we're just not paying attention to? Kelly: I think there are areas that we're paying attention to but not executing well. The problem of dealing with terrorism centers around three elements. The first is finding or acquiring the intelligence that may allow you to pre-empt or prevent the act. As we saw in the 9/11 case, there was a gross failure on the part of our intelligence agencies to detect the preparations by these people who hijacked the aircraft. The second thing you can do is put into effect either physical or procedural security measures that will reduce the risk of terrorism. The third thing you can do is to properly regulate your borders. Regulation of borders addresses terrorism here in the United States, but it doesn't address it overseas. What I've been talking about is mainly the threat that faces the United States government in its embassies and its military forces overseas. But, there's an equal problem for American business, which is an attractive target for a lot of terrorists. McCoy: The challenge to business is going to be one of the main discussion points here. This may be a naïve view, but I want to present it to you and get your perspective on it. It seems to me — someone who is not a terrorist expert, but someone who's watching what's happening around the world — that, while terrorism is not new, each new act of terrorism appears more brazen than the last. First of all, is that true? And, in your opinion, how has terrorism changed since the 1983 Beirut attacks?
Well, I don't think each act is more brazen than its predecessor. Most terrorism acts are aimed at targets of opportunity. Technology is helping terrorists — whether it's communications technology, explosive technology or technology that begins to get in the domain of weapons of mass destruction (that is, chemical, biological or even nuclear threats). Think of the assassination of the Archduke Franz Ferdinand in Sarajevo, which set off World War I. That was the assassination of a governmental figure by a single gunman with a pistol. Terrorism has gotten more sophisticated as explosives have gotten more powerful and as terrorists have learned how to manipulate and use technologies to give them, if you will, a greater impact — a bigger bang for the buck, to put it in crude terms. So, that's why I think the terrorist acts get more dramatic. We know that Bin Laden's associates, at one point, concocted a plan to hijack an aircraft and fly it into the Eiffel Tower in Paris, which would, again, have been a dramatic and stunning terrorist action. We know that other terrorists planned to hijack an aircraft and fly it into the Ataturk Mausoleum in Turkey on the day when the entire government of Turkey comes every year for ceremonies — sort of like the Tomb of the Unknowns in Arlington National Cemetery. So, terrorists are using their imagination to figure out how they can have the most dramatic impact. And technology is helping them. McCoy: One of the challenges that we saw post-9/11 was legislation. The opening line of the USA PATRIOT Act of 2001 states its purpose: "to deter and punish terrorist acts in the United States and around the world." In your opinion, has the Act worked? Does the Act go too far or not far enough? Kelly: The PATRIOT Act is one of the tools in a big kit of tools that governments have. I'm not convinced that it has made a significant difference. But I am not among those who feel that the Act has changed civil liberties in the United States. The tools involved are those that we mentioned: intelligence; police work to follow up on intelligence; and preventive measures at the borders and at facilities that need to be secured, such as airports and nuclear power plants. Those aren't matters so much of legislation as they are of leadership, organization and implementation. McCoy: The PATRIOT Act has certainly been seen as a challenge to civil liberties, but civil liberties are not as important in certain countries as they are in the United States. What does worldwide policy toward terrorism look like? How has it changed — especially post-9/11? Kelly: There's a lot more attention around the world post-9/11. Indeed, there has been change in some countries like Saudi Arabia, which for too long ignored the fact that much of the terrorism was being incubated in Saudi Arabia or by Saudi Arabian citizens. After a series of attacks within Saudi Arabia, the Saudis themselves seem to have awakened to the fact that they are among the principal targets of the terrorists and that they'd better do something about it. It varies from country to country. Europeans, over the years, have often been complacent about terrorist threats and terrorist actions — in essence, allowing terrorists to transit their territory as long as they didn't conduct acts on their land. That has changed. We're seeing the Germans, the French and the Spanish — particularly after the bombings in Madrid of a year ago — become much more vigilant about terrorism. Nevertheless, international cooperation isn't as good as it ought to be. There's probably a lot that still needs to be done. McCoy: In the specific case of Europe, are you implying that there was active awareness of terrorist traffic? Or, was it just complacency, they weren't really concerned about it? Kelly: No. They were actively aware that people were transiting. McCoy: While you were living in Lebanon, you had firsthand experience with working and trying to thrive under the threat of terrorism. You also watched others as they were living and working under similar conditions. What was it like to live in that kind of environment? What did you witness during your tenure as the ambassador to Lebanon? Kelly: Well, by the time I got there, the embassy had been blown up twice and the Marine barracks once. So, we had our physical security — in other terms, barricades — pretty well in place and an extraordinarily large armed force that we employed to protect ourselves. There was fighting in the city and in the environment every day. We worried as much about shelling as we did about a car bomb. By the way, with shelling, there wasn't much we could do except have shelters that we could take refuge in.
It creates a climate of apprehension, which is hard on everybody. It was hardest, of course, on the people who live in the city. As international visitors, we all knew that sooner or later we were going to get out of there. Whereas the Lebanese — and today, the Iraqis — don't have that option. It does take a toll on life. And it slows down business transactions. People are less likely to travel, to make deals, to go to meetings, to go to business lunches. It has a chilling effect on almost all the activities of life. One of the most touching moments I remember was going to the Defense Ministry early on a summer morning in Lebanon and talking to a colonel whom I knew well. He was a tough Lebanese Army colonel. He seemed very shaken that morning. I asked, "What happened?" He replied that a bomb had gone off in front of the apartment building across the street from where he lived. I asked him whether anyone in his family had been hurt. He said no, but his children were so terrified that they wouldn't go to school. That had shaken him up — and understandably so. We all tend to take things like sending our kids off to school every morning as something routine. But when you live in a country that's afflicted by regular terrorism — whether it's La Paz, Bolivia; Bogotá, Columbia; Beirut; or Baghdad — it's a horrible way to try to conduct your life. McCoy: You mentioned the impact on some of the businesses. How did the domestic enterprises thrive? Or did they whither? And how did the international business community react to a "dangerous Lebanon"? Kelly: Business was dramatically affected. If one looked at the GDP figures for Lebanon, they diminished each year during the war. That was a clear result of the terrible impact that terrorism and warfare had on the business climate. Nevertheless, businesses continued to function, particularly those involved in providing consumer goods and necessities to the public. International businesses had to adapt. One of the sectors I looked at when I was there was banking. Bank branches had to extend hours to make themselves more available to customers because of the crazy schedules people kept. There were more than 90 banks operating in Lebanon, even at the height of the war. So it was possible to continue to do business. The other great plus, of course, was modern technology that you wouldn't have seen in World War II or even at the time of Vietnam, where people were able to interface with computers, e-mail, faxes and all the modern communications techniques that we take for granted. As long they had power and a phone line, they could do business. International companies faced a different challenge. Some of them reacted by pulling their American citizen business managers and staff out and shutting down. Others turned the whole operation over to local staff — for instance, Lebanese in the case of Beirut. Others used third-country nationals — French, Italians, Japanese or others — and tried to do business on a minimal basis. I recall two U.S. automobile manufacturers operating in Lebanon. One shut down its operations until the war was over, and the other decided to continue to operate with a locally-recruited and -based staff and did a fairly decent business. It made a little money during the war and was in a good position once the war was over. The company that had shut down operations — it said it would be temporary, but it lasted for, I think, six or seven years — had to start again from zero. McCoy: Airlines, financial services companies and certain other industries have often been highlighted as taking terrorism seriously. In your opinion, how widespread is the practice of incorporating the threat of terrorism into enterprise scenario-planning efforts? Is such planning taking place across all industries? Kelly: My experience in the last 10 years of working with private-sector American firms in their overseas operations is that it varies dramatically from company to company, regardless of industry sector. Some companies take terrorism planning — the protection of employees as well as the protection of business information and business centers — very seriously. Others hire an outside firm or recruit into the company experts who may be very good with physical security but perhaps don't have the context for figuring out when extraordinary measures are needed and when they are not. This is an appropriate point to mention the government indexes of threats and warning. The United States Department of State puts out threat evaluations and warning notices for every foreign country around the world. One can go to the State Department Web site and look up any country to get a current appraisal of the threats and dangers to resident Americans and American businesspeople visiting that particular country. Those are worthwhile endeavors. I do know, from my time in government, that there is a tendency to be overprotective, to ensure that, if anything happens, you had predicted it. So, often, it's a worst-case threat analysis. I also find that those countrywide prescriptions may be grossly overdrawn. I think of, for instance, the opening week of the United States invasion of Iraq in March 2003, when the State Department put out a notice that American citizens and businesspeople should not travel to any of the adjacent countries in the Middle East — Kuwait, Saudi Arabia and Turkey. When you were 1,000 miles away from Baghdad, there wasn't much going on. If you were prudent, you could be safe. I took a business trip to that region at that point. To me, it was a little bit like saying there's rioting in Los Angeles, so therefore don't go to Seattle. It doesn't make sense. Companies and corporate leaders need to look beyond these sort of gross general warnings and try to get an appraisal, if need be, from an outside consultant, of the particular situation in the country in which they're interested. McCoy: How much does insurance liability play into this discussion? Kelly: This is a genuine factor. There are employment practices — employment contracts, for instance — in some countries in that part of the world where a State Department warning or a State Department voluntary evacuation suggestion will trigger a higher level of insurance premiums and expose a company that sends its employees there to greater liability. We see it in civil airline insurance, which can fluctuate wildly, though the insurance underwriters keep a pretty close watch on where it's safe to fly and where it's not safe to fly. I happened to be in Kuwait on September 11, 2001. Within 24 hours, the insurance underwriters had raised the risk on air travel to the Middle East so greatly that traffic was virtually shut down for several weeks because the companies just wouldn't pay the premiums to fly aircraft there. In retrospect, that was a bit overdrawn. These can have significant financial impacts on the insurance rates that companies pay and also on the liabilities that they might incur. McCoy: Are there industries that are lagging behind in security planning and exposing themselves to terrorist activity? Kelly: I don't think you can make broad generalities about sectors. You'd have to look at particular companies to see how they're doing. The art of operating successfully overseas on a permanent basis, which most big corporations are doing now, means being aware of the situations in the countries in which you're operating and setting up a backup system so that all the information that may be perishable or valuable to the company is protected against not just terrorism or civil war, but also other natural disasters. That sounds rudimentary, but a lot of companies still aren't doing that. So, you can't make gross generalities about which sector or which industries are doing a particularly good or bad job. I suspect the financial sector is doing a bit of a better job than some of the manufacturing sectors. But that's a speculative assertion on my part. McCoy: Take the food industry, the transportation industry, the utility industry — industries where there's a mass-exposure potential: people hooked up to the water supply, people buying cookies at a grocery store. Is that a profile that terrorists look for? Kelly: You mentioned food, utilities — water, for instance — as particularly vulnerable industries. I'm not necessarily convinced that they are. Most of those scenarios involve somebody poisoning a water supply for New York City or poisoning the orange crop or something like that.
You can still have an impact. When a couple of bottles of Tylenol were laced with cyanide 23 years ago in Chicago, that had a worldwide impact on Tylenol sales. But the company stepped up and took measures to defend against it. In terms of defending water supplies or food, I think we may be subject to frightening and scary, but very small-scale, attacks. I really am skeptical that a large-scale attack could affect those industries. McCoy: From what you've seen, can you describe what the impact of terrorism is on enterprises in terms of their perceptions of security and stability? Do they quake under this threat? Do they see it as something that's just a cost of doing business? Or do they see it as something they can take cogent steps against? Kelly: Companies will react differently, depending on the scenario. One Fortune 100 company with which I work suspended international travel for 90 days following the attacks in New York and on the Pentagon on September 11, 2001. I thought that was a gross overreaction, because, as shocked as we were, we figured out very quickly that this was not a constant wave of attacks all over the world. For a major international American corporation to stop international travel for 90 days, that is a shortsighted measure. So, you can do two things: One approach is to be proactive and position your company so that when the shocking event comes — whether it's a tsunami, a California earthquake or a terrorist attack — you're in a position to not let the impact overwhelm your business. The other approach is to be a reactive and say, "We'll deal with it when it hits us." Obviously, I think the savvier business leaders are going to be in the first category. McCoy: I'm thinking of the "duck and cover" mentality of the 1950s for surviving a nuclear blast. You'd see the news clips of the kids putting their heads down on their school desks in preparation to survive an atomic bomb. Do we have a naiveté like that emerging now, where enterprises are taking similar reactions to the threat of terrorism? Is a lot of the scenario planning they're doing really just a feel-good exercise? Kelly: Some of the scenario planning is a feel-good exercise. It reminds me of an old quote from General, then President Eisenhower, who said: "Plans are worthless. Planning is everything." This means that the intellectual effort to try to understand what you might do in a given set of circumstances is worthwhile even though the actual plan that you've drawn up may be overcome, overtaken by events within a little while. It's worthwhile to try to anticipate what might happen. But I don't think we can allow that to immobilize ourselves — either in business or in our personal lives. McCoy: What are some other ways enterprises are addressing terrorism-related risks through changes to their business operations? Kelly: I've mentioned trying to get beyond the gross generalities in security analysis for where your people and your operations are going to be. In recruiting personnel — and that's a key for an awful lot of countries — you've got to determine whether your people are willing to serve internationally (as more and more firms need to have their people do) and whether they're going to be in a position to accept and undertake risk. McCoy: What would be the top things that enterprises concerned about the impact of terrorism should consider right away to start getting a grip on at least understanding their options? Kelly: The first thing that the leadership — whether it's at the board level or top corporate management — needs to decide is whether operations in a particular country or a particular region of the world are critical or vital to the company's continued success. If they are, then contingency plans and precautionary measures need to be taken with regard to personnel, to data, to locations, to business processes, to recruitment of personnel and probably to retention of an outsource capability to provide real-world advice. One of the conclusions I've reached is that many security firms and terrorism consulting firms tend to employ ex-government people or former police officers who will, in effect, give a cookie-cutter approach to protecting your operation. They're very good on the physical security angle and less proficient at figuring out the vulnerabilities, and the risks and return of continuing to operate in one particular environment. McCoy: Israel has been dealing with terrorism for a long time and seems to have a pretty good handle on the planning aspect. You can't stop terrorism, but they certainly take it very seriously. What can companies and other countries learn from the Israeli approach? Kelly: Israel's in a unique position because it is at a high threat level every day of every year. The one-sentence answer the Israelis have adopted is "permanent vigilance." Israeli businesses, of course, adapt to the conditions, though any Israeli company around the world tends to have a higher degree of security awareness and, indeed, physical protection than of any other set of corporations. The Israelis are very proficient at physical security and probably have no competitor when it comes to the vigilance and the amount of resources proportionally that are devoted to intelligence and reactive capability. Nevertheless, there have been 800 Israelis killed as the result of terrorist attacks in the past four years in Israel and adjacent territories, which means that, as many assets as they devote, no system of protection is perfect. That is because of the nature of their location — as dangerous a location on a long-term basis as one could find. But, I think American companies will not face on a sustained basis the sort of permanent threat that Israeli companies do. There's a lot we can learn from their techniques. But, I'm not sure that we need to adapt our practices as strenuously as the Israelis do. McCoy: Senator Richard Lugar [chairman of the U.S. Senate Foreign Relations Committee] recently released a survey on terrorist threats http://news.findlaw.com/hdocs/docs/terrorism/lgr62105nps.pdf. Among the findings was the suggestion that the estimated risk of a weapon-of-mass-destruction attack in the next five years is as high as 50 percent, and rising to 70 percent 10 years out. What's your opinion of the survey results and the conclusions it made? Kelly: Senator Dick Lugar and former Senator Sam Nunn have performed a signal service in alerting the world and sponsoring remedial measures to respond to the threat of weapons of mass destruction. The Lugar survey acknowledges that it is not a precise scientific survey, but rather a "Delphi" survey of some experts in the field. Nevertheless, the findings accurately point to the reality of terrorist threats. Government leaders need to take this survey seriously and put more money and diplomatic push into the effort to secure and cordon off sources of weapons of mass destruction. These are not threats that the private sector can address; they require concerted action by governments. McCoy: The Lugar report identified the nuclear black market as the most likely source for terrorists to acquire radioactive material. Given your background with the Strategic Arms Limitation Talks and the Strategic Arms Reduction Treaty, you understand nuclear proliferation at the national level. How real is this black market? How does controlling it differ from dealing with a country through treaties? And, finally, can the black market ever be shut down? Kelly: A nascent nuclear black market exists in the countries of the former Soviet Union, especially Russia. Most of the operators in this shadow world are con men, trying to dupe would-be purchasers into buying materials that are unsuitable as weapons — such as irradiated scrap metal. But sooner or later, someone will sell a nuclear weapon. More likely will be the sale of dangerous radioactive material which will be the makings of a "dirty bomb" something that can be strapped to a stick of dynamite. This will not produce a nuclear explosion, but could scatter radioactive material over a portion of a city, exposing large numbers of people to radiation poisoning. To prevent and control the nuclear black market, we need crackerjack and well-trained intelligence people and effective international cooperation. The lid has stayed on for 15 years, but the black market continues. McCoy: Can you close with some advice to help us put terrorism in context for our businesses and our personal lives, or should we just assume that our nights of peaceful sleep ended in the 1950s? Kelly: The world will always present risks and dangers. To put the 1950s in context, terrorism was rampant then in France, Algeria, Kenya, Cyprus, Malaysia and Indonesia. A prudent business or individual can take one step: get beneath the surface level of popular fears and government warnings. Professor Don Emmerson, an Asia scholar at Stanford, has suggested that there ought to be a task force to brainstorm ways of overcoming unrealistic fears of travel. He also suggests that U.S. Embassy Web site warnings include figures on how many Americans have actually been wounded and killed by terrorist acts in the preceding 10 years, so that travelers can make their own judgments. I guess my final advice would be that, if you have a tax problem, you call in a tax expert. If you have a security problem, call in someone who can help you analyze the threat and decide on a realistic response so that business decisions can be made on an informed basis. McCoy: John, thank you for your time and your wisdom.  |
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