Right or wrong, the move by the Director of National Intelligence (DNI) to assert what is supposed to be his authority to appoint Intelligence Community (IC) officials of his choosing to serve as the IC’s senior intelligence representatives abroad, has been derailed by President Obama, raising questions about  the effectiveness of Congress' post-9/11 reformation of the IC.

The White House sided with CIA Director Leon Panetta, whose position is that CIA chiefs of station (COS) should continue to be the top IC officers overseas – a function they’ve historically carried out.

Panetta bitterly opposed DNI Adm. Dennis Blair’s (ret.) effort to reduce this authority of station chiefs by establishing for the DNI a convention for naming the top spooks overseas.

Acting on the authority given to the DNI in the sweeping post-9/11 intelligence restructuring legislation put in motion under the Bush administration, Blair issued a directive in May promulgating the DNI’s right, in "rare circumstances," to appoint persons other than CIA station chiefs to be the DNI’s representative to foreign governments and international organizations.

Blair moved to elevate persons answering directly to him to be the top intel officers abroad – a move that had been supported under Bush but never officially settled, although Congress presumably bestowed this authority to the DNI.

Blair and his predecessors believed that it was incumbent upon the DNI to be able to tap the most relevant and qualified intelligence officers around to serve as the DNI’s eyes and ears in certain countries.

Four years ago, John Negroponte, the nation’s first DNI, designated that an intelligence officer that answers directly to the DNI be installed at embassies, military commands, and overseas posts.

Although station chiefs would not necessarily fit the bill in some places under Blair’s plan, Blair’s directive did provide that, in "virtually all cases globally," the representative would be a CIA COS and that, before the appointment of anyone else, the CIA director and the local ambassador would be consulted.

Both Panetta and his predecessors though balked at the notion that anyone other than a CIA COS or some other top CIA official be considered the senior US IC representative abroad.

In its report on the fiscal 2010 intelligence authorization bill, the Senate Select Committee on Intelligence said it supported Blair's directive and "looks forward to the CIA's prompt adherence to his decision” based on the clear legal authority that was given to the DNI under the intelligence reformation act.

The Senate Intelligence Committee said the DNI, and not the DCI, should have ultimate authority to name the top US intelligence officials overseas.

In its report, the Senate Intelligence Committee concluded that Blair's directive, which is classified, "recognizes the value of turning to the CIA Chief of Station to be the DNI's representative in foreign countries, but also recognizes that some locations may give rise to circumstances where that responsibility is best met by an official with expertise derived from another IC element, which in fact is already current practice and is not disputed by anyone."

But following release of the report, and just like happened when DNI John Negroponte and his successor Mike McConnell tried to do what Blair did, the DCI made very clear that it would not stand for any change in the status quo, which is anathema to Congress’ restructuring of the IC.

As The Atlantic this week reported an intelligence official having told it, “the DNI was simply trying to institutionalize the roles and responsibilities as required by Congress.”

Last June, HSToday.us reported that the turf war between Panetta and Blair had exposed a fundamental “botched reorganization” of the IC. But the lingering dispute also has highlighted the dismal failure of the White House to definitively acknowledge the new chains of command that Congress established for the IC in response to recommendations made by the 9/11 Commission. Most importantly, intelligence officials said, failure to adhere to the chains of command could lead to break-downs in vital communication, inter-agency coordination and squabbling, and unnecessary replication of some duties.

Indeed. In addition to the DCI’s insubordination to the DNI, the CIA also had not been keeping the DNI in the loop on the CIA’s biggest covert collection and direct action programs. Blair often didn’t know about CIA Predator UAV attacks on Al Qaeda and Taliban positions in Pakistan until well after the strikes had taken place. The CIA dutifully informed the National Security Council, but not the DNI – a clear-cut act of insubordination under the congressionally restructured lines of authority, officials told HSToday.us on background because of the sensitivity of their positions.

Meanwhile, in a new memo to his subordinate chiefs citing backing from the White House, Blair stated all sensitive CIA operations overseas will be assessed and evaluated by the DNI for “effectiveness." However, some intelligence officials reportedly have summarily dismissed the memo, asserting that CIA covert action authorities are intact.

The Los Angeles Times this week quoted an intelligence official on condition of anonymity saying that “covert action is ordered by the president and carried out by the CIA,” and that “that relationship, which involves a single, direct line of command and communication between the White House and the agency, isn't changing."

According to senior veteran intelligence officials, though, while the DNI probably shouldn’t be getting down in the weeds directing or micro-managing CIA covert actions, the DNI must, as supreme overseer of the IC as intended by Congress, be in the loop on the discussions, planning, and execution of covert activities. And he certainly needs to be assessing and evaluating the effectiveness of these activities as part of the DNI’s larger responsibility to administer over-arching management issues and strategic intelligence matters.

HSToday.us reported early on following the IC’s restructuring that one of the DNI’s biggest challenges would be to be recognized as the IC’s CEO, while at the same time being able to have productive relationships with the other members of the IC devoid of turf disputes.

Authorities cautioned that the historic, congressionally-mandated reform of the IC did not adequately address the equally as historic impediments to intelligence collaboration like territorial wars, the jealous hoarding of secrets, bureaucratic inertia, and the fear of making career-crippling controversial decisions.

In the ensuing years since the IC was overhauled, there have been “warnings and indications" - to use the IC’s own parlance - of a creeping return of these hindrances, especially the encumbrance of turf protection, which in particular reared its ugly head in reaction to DNI McConnell’s move to do what Blair has tried to do.

HSToday.us noted at the time that it was clear that the post-9/11 functioning of the IC as it was intended by its congressional overhaul was going to require stern presidential knuckle rapping.

Former CIA officer Melissa Boyle Mahle told HSToday.us that “the biggest issue is [the DNI is] going to have to come out as a credible player, and demonstrate that he’s willing to use the mandate [to reform the IC]. But he has to be careful how he does it, because if he has to go too often to bat – to the Presidential piggybank for influence – it shows that he doesn’t actually rule the kind of power that you need to personally” – and which the DNI is supposed to inherently possess under the IC reorganization if he’s to effectively lead the Community.

Author of, “Denial and Deception: An Insider’s View of the CIA from Iran-Contra to 9/11,” and a counterterrorism expert who was the top-ranked female Arabist in the CIA when she retired as a covert officer, Mahle presciently said the DNI must “especially have the President’s full support ...”

“The DNI shouldn’t have to be going to the President to resolve disputes – he needs to be able to exercise his congressionally mandated authority. Case closed,” said former CIA case officer Robert David Steele, a longtime champion of intelligence reform.

According to intelligence insiders, Blair believed that the authority Congress gave to and intended for the DNI is meaningless until the President acknowledges the ultimate primacy of the office.

As for Panetta, Steele said in his typical un-mincing of words way that “his resistance to Blair on Station Chiefs … has shown that he has been rolled by the clandestine service - he has failed to apply what he does know as a former Office of Management and Budget and White House leader, and allowed himself to become a pimp. The prostitutes are running the whorehouse.”

Although the origin of this kafuffle began back under Negroponte, the first DNI who proposed what McConnell after him proposed, but which was left unresolved because of pushback by the CIA and the lack of definitive action by Bush, Obama found himself in the same predicament with his DNI, whose authority he has not supported and enforced.

So it is that the functional control Congress’ IC overhaul gave to the DNI continues to reside in a dysfunctional state and the historic turf wars within the IC that were supposed to have been exterminated by its overhaul rage on.

The latest dust up over the supremacy of the DNI erupted when Blair, following up on the failed effort by his predecessor, Mike McConnell, last spring issued an order outlining that he was selecting who will be the top intelligence officers abroad as the DNI’s eyes and ears.

In response, Panetta insubordinately issued an edict that Station Chiefs ignore Blair's plan until the matter is resolved by Obama’s National Security Advisor Jim Jones, who Panetta indicated was still reviewing this left over problem from the Bush administration.

Blair, not surprisingly, reacted to Panetta's action as “an act of insubordination,” which also isn’t surprising given that the DNI is the nation’s chief IC official and Panetta, while DCI, remains a veritable intelligence outsider.

While both Blair and Panetta’ arguments for and against the DCI choosing the top spies abroad have merit, that’s really not the big issue here. The real issue has always been whether the DNI’s authority is going to be upheld once and for all. And until a President makes it known loud and clear that the DNI is the top spook, the effectiveness of the DNI, right or wrong, will be seriously eroded.

But more than that, insiders said all IC chiefs under the DNI should be put on notice that they are subordinate to the DNI, that insubordination will not be tolerated, and, that any efforts to undermine the DNI’s authority will be considered, as they should be, detrimental to the effectiveness of the IC as a whole.

As a matter of respect and practicality, however, any effort by the DNI to make the kind of historical change Blair and his predecessors tried to make ought to be thoroughly made in consultation with the head of the impacted agency and the National Security Advisor, which it’s not clear Blair did, although analyses of the move attempted by his predecessors are said to have been performed.

In short, as intelligence authorities said at the time of the IC’s reorganization, the DNI should not have to be going to the White House to get matters like this resolved. Under the post-9/11 reformation of the IC, the DNI is supposed to have the final say over all such matters without having to call on the President to step in to referee.