Admiral Dennis C. Blair, the newly confirmed Director of National Intelligence, presented the Senate Intelligence Committee on Thursday an overview of the global security threats facing the United States.
The global economic crisis ranks as the most dire threat to international stability, he said, because as economies falter, so does confidence in both markets and governments.
"Besides increased economic nationalism," Blair told lawmakers, "the most likely political fallout for U.S. interests will involve allies and friends not being able to fully meet their defense and humanitarian obligations."
The latter could hurt U.S. homeland security if refugees flow into the U.S. from the Caribbean, he said.
While the United States has made significant progress against al Qaeda globally, Blair said, the terrorist organization remains dangerous, especially in Yemen, East Africa, and the Federally Administered Tribal Areas (FATA) of Pakistan. He also noted fears that al Qaeda could inspire homegrown attacks against the United States, although the threat is less severe than in Europe.
The "arc of instability," stretching from the Middle East to the edges of western South Asia, received the most attention from Blair.
Iran's regional ambitions marked by its nuclear program, its support of Hamas and Hezbollah, and its contempt for Israel present many security problems the United States. More broadly, Blair worried about Islamic radicals wresting anti-Israel credibility from moderate Arab governments, thereby fanning radicalism throughout the region and destabilizing those same regimes.
The one bright spot in the region is Iraq, Blair said, as the country continues to stabilize after the recent elections. Blair tempered his enthusiasm, however, saying the gains could be quickly lost.
Central South Asia, meanwhile, could slide into further instability if tensions fester between India and Pakistan after the Mumbai terrorist attacks, if the insurgency in Afghanistan continues, and if Pakistan does not deny al Qaeda and Taliban militants their safe haven in the FATA, Blair warned.
Moving further east, Blair noted that the "arc of instability" breaks down as global power shifts to Asia.
"East and South Asia are poised to become the long-term power centers of the world," Blair said. "China and India are restoring the positions they held in the Eighteenth Century when China produced approximately 30 percent and India 15 percent of the world's wealth."
Security challenges there, however, remain. China, like most developing countries, could face escalating internal instability if the global economic slowdown continues. Tensions between China and Taiwan still merit scrutiny, although diplomatic overtures hint at improved relations. China will continue to develop its naval capacities as its strives to project power beyond the South China Sea, Blair said.
In cyberspace, the United States remains vulnerable to attacks against its information infrastructure from hackers and nation states, predominately Russia and China, Blair said.
" A successful cyberattack against a major financial service provider could severely impact the national economy," he said, "while cyberattacks against physical infrastructure computer systems such as those that control power grids or oil refineries have the potential to disrupt services for hours or weeks."
Technologies that could protect all of the United States critical IT infrastructure exist, but haven't been universally adopted, Blair told lawmakers.
During two hours of testimony, Blair also addressed Latin America's persistent problems of corruption and poor governance, compounded by rising violence associated with drug trafficking; Russia's closer relations with hostile nations such as Iran and Venezuela; Africa's endemic poverty; and the effects of climate change as masses of people continue to move from rural areas into urban centers.