By MARK LANDLER and PETER BAKER
New York Times
President Obama, declaring that advances in technology had made it harder “to both defend our nation and uphold our civil liberties,” announced carefully calculated changes to surveillance policies on Friday, saying he would restrict the ability of intelligence agencies to gain access to telephone data, and would ultimately move that data out of the hands of the government.
In a much-anticipated speech that ranged from lofty principles to highly technical details, Mr. Obama said he would require prior court approval for the tapping of telephone data. He also said he would forbid eavesdropping on the leaders of allied countries, after the disclosure of such activities ignited a diplomatic firestorm with Germany and other friendly nations.
“America’s capabilities are unique,” Mr. Obama said. “And the power of new technologies means that there are fewer and fewer technical constraints on what we can do. That places a special obligation on us to ask tough questions about what we should do.”
In the front row at Mr. Obama’s speech were his top security officials, from left to right: F.B.I. Director James B. Comey, C.I.A. Director John Brennan, Director of National Intelligence James Clapper and Homeland Security Secretary Jeh C. Johnson. Stephen Crowley/The New York Times
But Mr. Obama also delivered a stout defense of the nation’s intelligence establishment, saying that there was no evidence it had abused its power, and that many of its methods were necessary to protect Americans from a host of threats in the years after the Sept. 11, 2001, terrorist attacks.
The president did not accept one of the most significant recommendations of his own advisory panel on surveillance practices: requiring prior court approval for so-called national security letters, which the government uses to demand information on individuals from companies. And he left it to Congress to determine how to carry out many of his proposals, which are likely to be extremely contentious.
Mr. Obama made only passing reference to Edward J. Snowden, the former National Security Agency contractor whose disclosures of classified information set off a national and international clamor over American surveillance practices. Mr. Snowden’s actions, he said, jeopardized the nation’s defense and framed a debate that has “often shed more heat than light.”
Still, noting his own record of opposition to intrusive surveillance and the “cautionary tale” of unchecked state spying in countries like the former East Germany, Mr. Obama acknowledged that the disclosures raised profound issues of the balance between liberty and security.
“When you cut through the noise,” the president said, “what’s really at stake is how we remain true to who we are in a world that is remaking itself at dizzying speed.”
Though Mr. Obama has been weighing these changes for months, he made a final decision on judicial review for the collection of phone records only on Thursday night, a senior official said, attesting to the extreme delicateness of these issues and the competing interests at play.
At the heart of the changes will be an overhaul of a bulk data program that has swept up many millions of records of Americans’ telephone calls, though not their content. While Mr. Obama said such collection was important to foil terrorist plots, he acknowledged it could be abused and had not been subject to an adequate public debate.
“Critics are right to point out that without proper safeguards, this type of program could be used to yield more information about our private lives, and open the door to more intrusive, bulk collection programs,” he said.
In two immediate actions, Mr. Obama said intelligence agencies would only pursue phone calls that are two steps removed from a number associated with a terrorist organization, rather than three. He also instructed Attorney General Eric H. Holder to work with the Foreign Intelligence Surveillance Court so that intelligence agencies could only access the existing database in an emergency or with a court order.
On the question of which entity will hold the storehouse of phone metadata, the president said Mr. Holder would make recommendations in 60 days. Privacy advocates have called for telecommunications providers to keep the data, though many of the companies are resisting it.
Mr. Obama offered more modest protections to non-Americans, saying that the United States would extend privacy safeguards to foreigners for incidental information collected. He said he had directed Mr. Holder to develop procedures to restrict how long the government could hold that data, and what it could do with it.
“The bottom line,” he said, “is that people around the world – regardless of their nationality – should know that the United States is not spying on ordinary people who don’t threaten our national security, and that we take their privacy concerns into account.”
Mr. Obama said he would forbid eavesdropping on the leaders of close friends and allies, though he did not offer a list of those, and he pointedly said the United States would continue to collect information on the intentions of foreign governments.
“We will not apologize simply because our services may be more effective,” Mr. Obama said. “But heads of state and government with whom we work closely, and on whose cooperation we depend, should feel confident that we are treating them as real partners.”
Mr. Obama made no mention of two of the recommendations of his panel of most pressing concern to Silicon Valley and the business community: That the N.S.A. “not in any way subvert, undermine, weaken or make vulnerable” commercial software, and that it move away from exploiting flaws in software to conduct cyberattacks or surveillance.
The president has been sharply criticized by companies that protest that the N.S.A.’s practices are costing them billions of dollars in foreign sales, as customers in Europe and Asia fear that American products are deliberately compromised by the agency.
Mr. Obama’s refusal to address the issue reflects a deep divide in the administration, with some intelligence officials complaining that without the ability to break encryption, create “back doors”’ to enter computer systems abroad and to exploit flaws in software, the United States would be unilaterally disarming at a moment of heightened cyber conflict.
This issue has not generated the kind of public outrage that the surveillance has. But technology executives say it is at the top of their agenda, and they are already trying to develop “N.S.A.-resistant” products. Meanwhile, from Germany to China, there is talk of boycotting some American hardware and cloud services that are viewed as compromised.
Senior intelligence officials indicated that placing a limit of two additional contacts from that of an initial target – the so-called “two hop” rule – would not be a major burden because the practice of investigating an endless chain of contacts creates such a massive amount of data that it is too unwieldy for law enforcement agencies.
The president proposed to create a panel of advocates on privacy and technology issues that would appear before the Foreign Intelligence Surveillance. But the panel would be called on only in “novel” cases, rather than in every case. Left unanswered is who would decide which cases are novel.
Mr. Obama did not take up a recommendation to have the members of the surveillance court selected by appeals court judges rather than exclusively by the chief justice of the Supreme Court. Mr. Obama is not opposed to overhauling that process, administration officials said, but such a change would have to be authorized by Congress and he did not want to appear to be targeting the chief justice, John G. Roberts Jr.