National Risk Integration Center

Strategic Threats to National Security A Proposed Plan for an AllAgency, Systemwide, Strategic Intelligence Integration Capability to Identify Systemic Risk Lyle Brecht Capital Markets Research October 2009 - DRAFT 2.1

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The National Risk Integration Center Serves as fusion center for: - systemic risks integration - establishing systemwide view - developing global budgets - assessing progress - managing systemic risk

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Fusion Center Objectives • Identify point-source threats • Identify systemic threats • Plan priorities for action • Integrate federal, state, & private-sector response(s) • Learn what works • Design strategies to hasten innovation & adoption cycles

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Structure - Functional Components • Collections - HUMINT/technical, public source, proprietary

• Facility - funding mechanism(s) to address medium & long-term objectives

• Analysis - strategic (tactical is passed to appropriate agency/ department) • Operations - policy integration service for moving information across domestic/non-domestic jurisdictional boundaries, conflicting organizational missions

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Structure - Policy Components • Identification of emerging & systemic threats (present, near future and long-term) to global support infrastructure & sustainable economic growth

• Capital allocation methodology what policy actions can generate the best return on invested capital

• Necessary adjustments to existing regulatory landscape • Needed economic incentives/ penalties, budgets for change management, new-technology adoption cycles

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Intelligence - identifying systemic risk • Narrowly defined, often misses emergent threats, fails to fully assess and manage systemic risk by focus on point-source threats • Systemic risk that has large-scale, strategic impact on the nation’s security may arise from traditional and from unexpected sources not presently covered by IC • Systemic risk may arise from domestic or non-domestic consequents; always strategic

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• Many recent examples of unexpected systemic risk with national security consequences • Collapse of CDO (collateralized debt obligations) market - $50,000 billion global cost; U.S. taxpayers asked to pony-up $17,500 billion reserves • Failure to mange systemic risk of anthropogenic carbon emissions; if 350 PPM CO2 is tipping point (MIT studies), then $20,000 billion cost

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capital markets research lyle brecht 410.963.8680 [email protected] Expertise: identifying & developing means for managing systemic risk for national security & sustainable economic growth

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