The New York Times reports: President Obama is poised to order the National Security Agency to stop eavesdropping on the leaders of American allies, administration and Congressional officials said Monday, responding to a deepening diplomatic crisis over reports that the agency had for years targeted the cellphone of Chancellor Angela Merkel of Germany.

The White House informed a leading Democratic lawmaker, Senator Dianne Feinstein of California, of its plans, which grew out of a broader internal review of intelligence-gathering methods, prompted by the leak of N.S.A. documents by a former contractor, Edward J. Snowden.

In a statement on Monday, Senator Feinstein, chairwoman of the Senate Intelligence Committee, said, “I do not believe the United States should be collecting phone calls or emails of friendly presidents and prime ministers.” Ms. Feinstein, who has been a stalwart defender of the administration’s surveillance policies, said her committee would begin a “major review of all intelligence collection programs.”

The White House said Monday evening that no final decision had been made on the monitoring of friendly foreign leaders. But the disclosure that it is moving to prohibit it marks a landmark shift for the N.S.A., which has had nearly unfettered powers to collect data on tens of millions of people around the world, from ordinary citizens to heads of state, including the leaders of Brazil and Mexico.

It is also likely to prompt a fierce debate on what constitutes an American ally. [Continue reading…]

The 2013 ‘black budget’ for the U.S. intelligence community, provided to the Washington Post by Edward Snowden and published at the end of August, states that although overall the budget was declining it was being increased in specific areas:

“[W]e are investing in target surveillance and offensive CI [counterintelligence] against key targets, such as China, Russia, Iran, Israel, Pakistan, and Cuba.”

Monitoring the communications of the leaders of Israel, a country that has repeatedly made explicit threats that it might trigger another major conflict in the Middle East, would appear to serve the interests of both the U.S. and most of its allies.