SPIES LIKE US

All week long as outrage over America's vast international surveillance operation flared around the globe - from Europe to the Middle East to Asia and the Pacific - the White House cooed blandishments about the strength of its relationships with allies, its regard for international standards.

Up the road on Capitol Hill, the tone was often markedly different. Some of those called to testify at hearings about the National Security Agency's operations insisted that spying on friends and rivals alike was standard practice.

The discord between the two messages could not have been clearer.

When he appeared before the hearing on Tuesday, director of national intelligence James Clapper said it was a "fundamental given" that America collects intelligence on foreign leaders.

He went as far as likening some of the outrage that met allegations the NSA had tapped German Chancellor Angela Merkel to a scene in the movie Casablanca when police raided Rick's Cafe. "'My god, there's gambling going on here?' It's the same kind of thing," he said.

Playing down the significance of claims the NSA was targeting the leaders of allied and friendly nations, he insisted such spying was standard practice, a "hardy perennial".

"We do not spy on anyone except for valid foreign intelligence purposes, and we only work within the law. Now, to be sure, on occasion, we've made mistakes - some quite significant."

Outside the hearing rooms, many American commentators made similar points, if not more forcefully.

"I have a word of advice for American allies outraged by alleged NSA spying on their leaders, 'Grow up'," wrote Max Boot, a member of the Council on Foreign Relations, in his blog with Commentary magazine.

"That means you, Germany. You, too, France. And you, Brazil. Mexico, too. Also the European Union and the United Nations.

"Does the NSA spy on your leaders? Probably. Do you spy on leaders of allied states, including the United States? Probably. You just don't have the resources or capability to spy as effectively as the NSA does. But if you did, you would."

A similar sentiment was even expressed by the former French foreign minister Bernard Kouchner during the week when he said during a radio interview: "The magnitude of the eavesdropping is what shocked us. Let's be honest, we eavesdrop, too. Everyone is listening to everyone else. But we don't have the same means as the United States, which makes us jealous."

All this might be true, but even some who believe it to be the case think the NSA secrets revealed by Edward Snowden have nonetheless done America serious damage.

Speaking last week on a panel with Julia Gillard at the Centre for American Progress, a left-leaning think tank in Washington, DC, former secretary of state Madeleine Albright said: "Let me just say this, this is not a surprise to people. Countries spy on each other."

But she said the revelations had damaged American diplomatic efforts: "A lot of the things that have come out, I think are specifically damaging because they are negotiating positions and a variety of ways that we have to go about business.

"I think it has made life very difficult for [current Secretary of State John] Kerry. There has to be a set of private talks that, in fact, precede negotiations, and I think it makes it very, very hard."

And she warned against lionising Snowden. "Glorifying Snowden is a mistake. I think that what he has done is a criminal act and it has hurt us very, very badly."

You don't have to look far to find evidence to support Albright's concerns.

While some interpreted German protests over evidence the NSA tapped Merkel's personal phone as political noise designed for domestic consumption, others noted the German leader had grown up in East Germany under the surveillance of the Stasi, and while she might have expected the US to be gathering intelligence on Germany, she was probably shocked to learn her personal phone had been targeted.

Already, the impact has been significant. Protests have been made by a range of European leaders at a time when the US is seeking to finalise negotiations for a transatlantic free-trade agreement that has to date been championed by Merkel.

The EU has already discussed blocking US access to European banking transactions - a move that could seriously harm America's anti-terrorism efforts.

On Wednesday, as the White House was grappling with the fallout from the problematic launch of its Obamacare website, a German delegation was meeting senior officials to discuss America's spy program.

Meanwhile, an EU delegation was meeting staff at the State Department over the same issue, while a senior spokeswoman had been dispatched to take questions from foreign journalists for the first time during this administration. Marie Harf faced questions from Turkish, Spanish, British, Australian, Danish and Moroccan reporters regarding the NSA's spying.

Harf maintained the administration's line that while its intelligence operations were important not only to the US but to its allies, nonetheless the White House was leading a review into its intelligence programs.

"At the end of this review, which is going to be done by the end of the year, if we need to make changes, we will," she said

"And the President's also been very clear that just because we can do something doesn't mean we should do something. And it doesn't - it doesn't just speak to our security. We need to do what we must to protect our security, but it also needs to fit into our broader foreign policy strategy of how we achieve our objective."

Presumably, this means the administration will consider whether the information it secures from its targeting of foreign leaders is worth the diplomatic cost.

Within hours of Harf's briefing, the discontent had spread further after Fairfax Media revealed Australian embassies throughout Asia were used to assist US-led espionage without the knowledge of most Australian diplomats.

The story soon prompted protests from Indonesia and China. One of the keenest observers of the program in the US is the Pulitzer prize-winning journalist and author Ron Suskind, who said many people have no real understanding of the scope of the NSA program.

Rather than trying to tap or trace the communications of world leaders, diplomats and possible terrorists, he said, the NSA is seeking to record all global communications for its later use - use that may or may not be directly related to national security.

He cited as an example of this the revelations in his 2008 book The Way of the World that the NSA had managed to record phone calls made by exiled former Pakistani prime minister Benazir Bhutto with her son Bilawal.

In one of the calls, Bhutto told Bilawal how to access bank accounts holding a fortune suspected to have been raised corruptly. The information, Suskind wrote, was to have been used to manipulate Bhutto should she have returned to power.

He said any diplomat now sitting down to negotiate with an American diplomat could be wondering what they know about him, and could well be thinking: "Where do I sign."

Suskind said the White House-led review of US intelligence agencies was an inadequate response. He said America's true source of power over the past century was its moral authority rather than its capacity to field armies, and that this was being sapped by the unchecked growth of its espionage since the September 11, 2001, terrorist attacks.

He called for a full-scale review of all operations similar to that conducted by the Church Committee.

That inquiry was launched in 1974 after it was revealed US intelligence agencies had been engaged in large-scale domestic spying as well as international extrajudicial killings and assassinations.

When he finished his investigation in 1975, Senator Frank Church said of the NSA: "In the need to develop a capacity to know what potential enemies are doing, the United States government has perfected a technological capability that enables us to monitor the messages that go through the air.

"Now, that is necessary and important ... [but] we must know, at the same time, that capability at any time could be turned around on the American people, and no American would have any privacy left such is the capability to monitor everything - telephone conversations, telegrams, it doesn't matter. There would be no place to hide.

"If this government ever became a tyrant, if a dictator ever took charge in this country, the technological capacity that the intelligence community has given the government could enable it to impose total tyranny, and there would be no way to fight back because the most careful effort to combine together in resistance to the government, no matter how privately it was done, is within the reach of the government to know. Such is the capability of this technology."

So far at least, Australia and New Zealand have shown no such qualms.

On Monday, New Zealand Defence Minister Jonathan Coleman appeared at a press conference at the Pentagon and joked that any agent listening to NZ communications risked falling asleep.

Asked during her appearance at the DC meeting if she was concerned, Gillard said any analyst who listened to her calls as prime minister would only have heard praise for President Obama.

It is possible that Australian and New Zealand leaders feel more secure as members of the so-called "Five Eyes", an agreement that forbids espionage between the US and a handful of anglophone allies.

Asked if he believed the accord offered any guarantees against NSA intrusion, Suskind laughed. "I think they view it more as a guideline," he said.