ADVICE+DISSENT: Intelligence File Behind the Scene

New spy chief Mike McConnell knows how the shadow intelligence community works.

On Jan. 5, consulting giant Booz Allen Hamilton announced that its senior vice president, Mike McConnell, was leaving after more than 10 years to become the new Director of National Intelligence. In light of the fact that the DNI crafts the $45 billion intelligence budget, and McConnell's company is a top intelligence contractor, the immediate question was, "Is this good news for Booz?"

Yes. The company has a formidable footprint in the government intelligence market, and adding one more luminary to the mix doesn't hurt. More than 1,000 former military and intelligence officials reportedly have gone to work for the firm. Three former intelligence agency directors have become executives there. Joan Dempsey, a former CIA deputy director turned Booz VP, once called the consultancy "the shadow intelligence community."

But then, intelligence is hardly the only business where Booz has made a killing. In Government Executive's most recent Top 200 contractors listing, Booz clocked in at No. 17 on the civilian side and No. 29 for defense, with awards totaling almost $2 billion. So, what does McConnell's move mean for a company that, by all accounts, already is so successful?

There are two ways to answer that. The first and perhaps most obvious issue to consider is whether McConnell, who ran the National Security Agency before coming to Booz, will help the company win business. Unless the new DNI plans to follow in the footsteps of the Air Force's Darleen Druyun, he won't be wiring any contracts to his old bosses. But he doesn't really need to. Booz certainly owes part of its rise in the intelligence space to McConnell, but not all of it. In that line of the business, Booz has gained ground supplying consultants-read, warm bodies-to understaffed intelligence agencies. And that's the lens through which you can read the McConnell tea leaves more accurately. Following the collapse of the Soviet Union, and so the intelligence community's main enemy, the spy budget was pruned back, and with it, the number of analysts. Not until after Sept. 11 was there any push to dramatically increase their rolls, which are still too low for today's workload.

Enter Booz, and companies like it. These body shops provide the technology specialists and intelligence analysts that their clients just don't have in abundance. It can take more than half a decade, on the low end, to turn a green recruit into a decently seasoned analyst. But Booz's pond is stocked with former agency employees, who are trained and, more important, already have the security clearances that agency work demands.

"When you go to places like Booz . . . I think you get the individuals who are the solid base of experience, who have been through careers, who understand these things," says Tim Sample, the president of the Intelligence and National Security Alliance, an intelligence policy advocacy group where McConnell has served as chairman of the board. "As a contractor," Sample says, "it is to your advantage to hire people who are coming out of government because they [already have security clearances]. . . . You have somebody you can put on the job right away, and it works out for everybody."

When people talk of the "shadow intelligence community," this is what they mean. Surely for some, there's an unpalatable aspect to it, since they might want to believe that patriotism, not profit, drives people to work for their government.

In fact, it's often both. And for better or worse, having people in the seats right now is more important to officials than how they got there. This is the reality in which the intelligence community that McConnell is inheriting finds itself. Good news for Booz? Most certainly. And McConnell understands that as well as anyone.

Shane Harris, a staff correspondent for National Journal, wrote about intelligence and technology at Government Executive for five years.

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