free trade, and the expansion of democratic regimes provided a relatively unregulated environment for terrorist and criminal groups worldwide.

The result was a series of U.S. commissions in the late 1990s that looked at differing aspects of U.S. national security, including the threat of weapons of mass destruction and terrorism—the Hart-Rudman Commission, the Gilmore Commission, and the National Commission on Terrorism. At the same time, individual members of Congress had expressed concern that the United States did not have a cohesive, threat-driven, counterterrorism strategy. Some in Congress also expressed concern over the difficulty of ascertaining how much money was allocated to combat terrorism and where it was going.

Many proposals for reform were announced, most recommending more centralized policy direction. Some favored keeping and strengthening existing institutions. Others proposed establishing a coordinating office within the office of the vice-president, and yet others sought to merge a few federal agencies into a larger one. Reform was debated, but before the attacks of September 11, 2001, counterterrorism was simply not the top priority of the U.S. law enforcement and intelligence communities.

After September 11, 2001, priorities changed rapidly and dramatically. There was strong pressure for Congress and the administration to act decisively, and there was strong pressure from the intelligence community to focus any dramatic organizational mergers and reassignment of responsibilities away from them. Shortly thereafter (October 2001), President Bush, arguably in an attempt to preempt action from Congress, created an Office of Homeland Security designed to coordinate domestic terrorism efforts. Some members of Congress and some experts in the field, however, recommended a new federal agency or full department to integrate and heighten antiterrorism efforts. In 2002 the Bush administration sponsored its own proposal along these lines, and on November 19, 2002, Congress passed the Homeland Security Act of 2002 (P.L. 107-296). The president named Tom Ridge, former director of the Office of Homeland Security, to be secretary of the new Department of Homeland Security created by the act. The Senate confirmed Ridge’s nomination.

The creation of the new department constitutes the most substantial reorganization of the federal government agencies since the National Security Act of 1947, which placed the different military departments under a secretary of defense and created the National Security Council (NSC) and Central Intelligence Agency (CIA).

When we look at the emerging Department of Homeland Security, we see that it incorporates 22 government agencies and some 179,000 people into a single organization. We also see an organization with

• a proposed budget for FY 2004 of $36.2 billion—roughly one-tenth the size of the nation’s military defense budget ($380 billion). Note that overall these amounts constitute roughly a 7 percent jump in domestic defense spending.