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In Newsweek Magazine

All We Ever Do Anymore is Fight

CIA Director Leon Panetta, trying to fend off a new Justice Department investigation of agency interrogation practices, got into a shouting match at the White House and was on the verge of quitting—or so went the scuttlebutt in Washington last week. Suggestions that Panetta is leaving are "trash, pure and simple," says Paul Gimigliano, a CIA spokesman. He adds that Panetta, "who's had good jobs in Washington, views his current post as the best of all," and that the CIA chief intends to be at his job "for a good long time." White House spokesman Ben LaBolt says there's "not a shred of truth" to the suggestion Panetta is on the way out.

Still, institutional battles seem to be eroding his ability to defend the agency. Not only did Justice reopen the investigation into alleged post-9/11 CIA interrogation abuses, but the Obama administration made public documents describing in lurid detail how the CIA used "enhanced" techniques to extract information from terror suspects. To be sure, Attorney General Eric Holder's probe is carefully circumscribed to a small range of cases, leading some intel officials to conclude that, if Holder felt compelled to open an inquiry, he wanted to limit its impact. Among the issues the criminal inquiry is expected to focus on: alleged excesses in the use of waterboarding, says a counterterrorism official who asked for anonymity when discussing the investigation.

Yet another test of Panetta's clout is underway. For months the CIA chief and his boss, intel czar Dennis Blair, have been feuding. The beef? Blair issued an order giving himself the power to designate a senior U.S. intel rep in foreign countries—a designation that's historically gone to the chief of the local CIA station. The feud was so intense that it was referred to national-security adviser Jim Jones for resolution, say three intelligence officials who requested anonymity to talk about a sensitive matter. When Jones couldn't settle it, the matter was sent to Vice President Joe Biden. (A National Security Council spokesman had no comment.) The officials say Biden brokered an amicable settlement after meetings with Panetta and Blair, and that the results are expected to be ratified in a meeting in Biden's office this week.

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