NSA reforms further Obama's reshaping of war on terror

Next up for remodelling is the ravenous National Security Agency surveillance program, which hauls in phone and Internet data and was sharply criticized in a review commissioned by President Barack Obama.

The panel's report, released Wednesday, is not binding but Obama will spend his end-of-year vacation in Hawaii deciding which of the more than 40 recommendations to implement through executive power or legislation.

The report surprised some observers in the scope of its criticism of the NSA, following explosive revelations about its activities by fugitive intelligence contractor Edward Snowden(pic).

It may also further tip the political scale against the NSA program, following a critical court ruling, rising disquiet in the Internet industry and amid shifting public opinion on whether the agency is infringing core freedoms.

In a CBS poll in July, 67 percent believed that the collection of phone records represented an infringement of privacy.

Fifty percent in a Quinnipiac Poll in the same month said the NSA had gone too far.

"The message to the NSA is now coming from every branch of government and from every corner of our nation: you have gone too far," said Democratic Senator Patrick Leahy.

The five-man team of intelligence professionals and legal experts who wrote the Review Board Report recommended that the NSA halt bulk domestic phone record collection and that data should be retained by a third party and be subject to a judicial determination if US spies want to access it.

"We conclude that some of the authorities that were expanded or created in the aftermath of September 11 unduly sacrifice fundamental interests in individual liberty, personal privacy, and democratic governance," the report said.

Previously, Obama and the intelligence community had argued that the NSA's capture of vast troves of "meta-data" -- the destination and duration of billions of phone calls -- is an important tool in keeping America, and its allies safe.

"My assessment and my team's assessment was that they help us prevent terrorist attacks," Obama said in June, when the story on NSA first broke.

But the Review Board report challenged that assertion, leaving Obama now with a choice between his past determination that the program was effective and should continue, and changing conventional wisdom.

It is a dilemma which may leave the US commander-in-chief -- who has the ultimate responsibility for protecting his nation -- caught between the US intelligence community and changing political winds.

"Our review suggests that the information contributed to terrorist investigations by the use of section 215 telephony meta-data was not essential to preventing attacks," the Review Board report said.

US federal judge Richard Leon made a similar point on Monday, while ruling the bulk collection of phone records was likely unconstitutional.

"The government does not cite a single instance in which analysis of the NSA's bulk metadata collection actually stopped an imminent attack, or otherwise aided the government in achieving any objective that was time-sensitive in nature," Leon wrote.

Obama's presidency has been dominated by turmoil in divided Washington, duels over health care, and the president's scramble to frame a coherent response to crises abroad, especially in the Middle East.

Yet an underlying theme, which will loom large in history, has been his struggle to transition his nation from the Bush administration's permanent war to a more sustainable posture in the fight against terrorism.

With his oath of office still ringing in the chill winter air in 2009, Obama banned enhanced interrogation techniques that critics see as torture and vowed to close the Guantanamo Bay jail for terror suspects in Cuba.

He pulled US troops out of Iraq and plans to end the US combat mission of the first post-September 11 war, in Afghanistan, in a year's time.

"America is at a crossroads. We must define the nature and scope of this struggle, or else it will define us," Obama said, in a speech laying out his reframed anti-terror policy in May.

But so deep is the challenge, so complicated the threat, and so delicate the politics of national security, that Obama has struggled to piece together a coherent anti-terror policy.

While Osama bin Laden is dead and his core Al-Qaeda leadership decimated, terrorism has morphed into a hydra, in the Middle East, Africa, Asia and even among radicalized home grown extremists.

The president faces stiff resistance as he processes newly captured terror suspects through the US judicial system and Guantanamo Bay remains open -- though some progress is being made in emptying its cells.

Obama meanwhile has not repudiated all aspects of the Bush war on terror: his reluctance to fight land wars has led to a greater reliance on the use of airborne drones -- raising tough moral questions.

This year he has also sent US commandos into action in Libya and Somalia in pursuit of terror suspects.