As the Senate Armed Services Committee considered intelligence reform, acting CIA Director John McLaughlin also said he — personally — would support giving the president's proposed national intelligence director the authority to control the intelligence community's estimated $40 billion budget.
The added power, which the White House is considering, has sparked extensive debate.
Rumsfeld told the panel that consolidating defense intelligence agencies under a new director — outside the Defense Department — "could conceivably lead to some efficiencies in some aspects of intelligence collection" and "some modest but indefinable improvement."
But officials must be certain that such changes do not create new problems for intelligence agencies within the Defense Department, he said. "We would not want to place new barriers or filters between military combatant commanders and those agencies when they perform as combat-support agencies," Rumsfeld said.
The Sept. 11 commission's report suggested that Congress create an intelligence director of near-Cabinet rank to coordinate all 15 of the government's intelligence agencies, ensuring that they work with each other and share intelligence.
Amid a growing clamor for change during Congress's August recess, the committee's chairman also urged caution.
"As we examine ways to reform our intelligence community, we must be sure we do nothing to undermine the confidence of the battlefield commanders in the intelligence support on which they must depend," said Sen. John Warner.
The Virginia Republican suggested expanding the powers of the CIA director, who also oversees the 14 other agencies in the intelligence community, or giving the CIA director the title of national intelligence director.
Sen. Pat Roberts, a Utah Republican and chairman of the Intelligence Committee, revealed Monday he has drafted legislation that would give the new intelligence chief the budget authority and hiring and firing power to which the White House so far has not committed.
Critics of the White House proposal, as it now stands, say that without power over budget, hiring and firing the national intelligence director will lack the clout to streamline and improve the performance of the nation's spy agencies.
White House spokesman Scott McClellan said Tuesday that President Bush has ruled nothing out, including budget power. "It's important for the national intelligence director to have the authority he or she needs to do the job," McClellan said.
But the Pentagon currently controls most of the large intelligence agencies: the National Security Agency, which intercepts electronic communications; the National Reconnaissance Office, which operates spy satellites; and the National Geospatial-Intelligence Agency, which analyzes satellite pictures.
The Defense Department also controls roughly 80 percent of the money spent on intelligence, a classified figure estimated at $40 billion annually.
Former defense secretaries told senators Monday that the Pentagon's intelligence agencies ought to be left alone, highlighting the turf battles that may occur. "I don't think that the authorities in the Department of Defense should be placed under the NID," said James Schlesinger, who worked for former Presidents Richard Nixon and Gerald Ford.
But Roberts said his committee is working on a draft bill that would be close to the Sept. 11 commission's suggestion of a powerful director. Congressional aides said the committee draft has a National Counterterrorism Center and a national intelligence director with the power to hire and fire intelligence personnel, as well as set budgets for the 15 agencies.
"Control of the money, after all, is tantamount to power," said Sen. Joe Lieberman, a Connecticut Democrat.
The draft bill also would create general counsel and inspector general offices to oversee the entire intelligence community and a chief information officer to standardize communications among the agencies, the aides said.
Changes could still be made to the draft bill, aides said.
Three former CIA chiefs told the Senate Governmental Affairs Committee that if Congress creates a new position, it should have the power to make all of the intelligence community work together.
Also Tuesday, Sept. 11 commission vice-chairman and former Rep. Lee Hamilton told the House Homeland Security Committee that Congress itself must reform in order to defeat terrorists.
"The threat is so urgent, long-term and difficult that we not only have to reorganize the executive branch be we have to reorganize the Congress as well," he said, pointing specifically to the large number of committees and subcommittees that demand regular briefings from Homeland Security officials.
"Eighty-eight subcommittees — that is absurd and it is not fair to the executive branch," Hamilton said.