Merkel tap reveals vast spy net; Lloyd Austin speaks; Meet the MEK; Hagel to NYC; Rosa Brooks on “chipping” a kid; Who’s in nomination limbo?; and a bit more.

By Gordon Lubold

Central Command’s Lloyd Austin, not one to speak to reporters, gave a rare on-the-record interview to the Wall Street Journal as Iraq’s Nouri al-Maliki visits Washington. The WSJ’s Julian Barnes: "The top U.S. commander in the Middle East said Iraq has entered a downward spiral of violence that threatens to drive the country’s leader further into the hands of Iran and heighten sectarian tensions across the region. With Iraqi security forces responding inadequately, U.S. officials are concerned that al Qaeda will develop a haven stretching from western Iraq into Syria. ‘If left unchecked, we could find ourselves in a regional sectarian struggle that could last a decade,’ Army Gen. Lloyd Austin, the head of the U.S. military’s Central Command, told The Wall Street Journal in an interview here. Iraqi Prime Minister Nouri al-Maliki met with Vice President Joe Biden and congressional leaders on Wednesday, at the start of a visit to Washington and is set to meet President Barack Obama on Friday. The Washington visit comes at a pivotal moment. Gen. Austin and other U.S. officials have blamed the violence in part on decisions by Mr. Maliki’s government to exclude most Sunni Muslims from access to any real power in the Shiite Muslim-majority country." Austin: "We do worry that this has driven Maliki further into the hands of the Iranians, I think it has a bit." More here.

Want to meet the bizarre, hyper-connected group that is said to be mucking up talks with Iraq? FP’s Yochi Dreazen wants to introduce you: "…The Mujahedeen-e Khalq, or MEK, is the most powerful lobby you’ve never heard of, and probably the most unusual. It has used a combination of political savvy and seemingly bottomless pools of money to persuade many prominent lawmakers and former officials from the Bush and Obama administrations that it has broad support within Iran and could help turn the country into a democracy. Along the way, it’s gone from being as seen as a group responsible for the deaths of at least six Americans to one that is a vital partner in the effort to overthrow Iran’s theocratic regime.

"The MEK has also enlisted prominent retired officials to tout its cause in public speeches and private meetings at the State Department and on Capitol Hill. Its long list of supporters includes former New York Mayor Rudy Giuliani, former Attorney General Mike Mukasey, former Pennsylvania Governor Ed Rendell, retired Marine General Jim Jones, Obama’s first national security advisor, and retired Army General Hugh Shelton, a former chairman of the Joint Chiefs of Staff. MEK advocates like Rendell receive up to $30,000 per speech, which means many have been paid hundreds of thousands of dollars by the group. Rendell, in an interview, said he genuinely believed in the group’s cause and wasn’t in it for the money." More here.

The duo of John McCain and Lindsey Graham expanded on their concerns about Iraq from yesterday’s letter, penning an op-ed in FP editors call "The Anti-Surge." McCain and Graham say the Obama administration blames the Bush 43 WH. They write on FP: "…Nowhere was the Obama administration’s failure more pronounced than during the debate over whether to maintain a limited number of U.S. troops in Iraq beyond the 2011 expiration of the 2008 Status of Forces Agreement (SOFA) — a debate in which we were actively involved. Here, too, the administration is quick to lay blame on others for the fact that they tried, and failed, to keep a limited presence of troops in Iraq." They conclude: "The United States fought too hard and sacrificed and invested too much to allow Iraq to descend into violence once again. We owe it to the brave Americans who fought and lost their lives to do everything we can to ensure the realization of the goals in Iraq that they fought so hard to achieve. No one wants the Obama administration’s legacy in Iraq to be one of squandering our many hard-won gains there but, at present, that is the unfortunate reality it is facing." Read the rest of their argument, here.

Welcome to Thursday’s Halloween edition of Situation Report and congratulations to Red Sox Nation – "Tested and Triumphant" as the Boston Globe trumpeted this morning on the Sox’ 6-1 win over the Cards. An amazing, come-from-behind story and of course the first Series win for the Bosox at Fenway since 1918. Sign up for Situation Report here or just e-mail us at gordon.lubold@foreignpolicy.com and we’ll stick you on. And if you have a report you want teased, a piece of news, or a good tidbit, send it to us early for maximum tease, because if you see something, say something — to Situation Report. That and please follow us @glubold on the Tweeter machine.

Click bait: FP’s "The World’s Spookiest Places," a slide show, here.

In a last minute deal yesterday, the Senate confirmed Alan Estevez for a top procurement job at the Pentagon. Alan Estevez was confirmed yesterday to be P-DUSDY (Principal Deputy Undersecretary of Defense) for acquisition, technology and logistics. Also, Stephen Preston began this week as Pentagon General Counsel after being confirmed just recently. But the hold that Sen. Lindsey Graham, the Republican from South Carolina, has put on Obama administration noms means that a number of other Pentagon noms are still in limbo. They include: Marcel Lettre to be principal deputy under secretary of Defense for Intelligence; Jamie Morin to be director of the Pentagon’s Cost Assessment and Program Evaluation office; Jessica Wright for Undersecretary for Personnel and Readiness; Deborah Lee James to be Air Force Secretary; and Michael Lumpkin to be assistant secretary of Defense for Special Operations and Low-Intensity Conflict.

Hagel goes to the City. Defense Secretary Chuck Hagel heads to NYC today to address the Anti-Defamation League centennial meeting. He will discuss the role the Defense Department has in "projecting a national defense abroad and maintaining a strong respect for civil rights at home," we’re told by a defense official. Hagel has met with the ADL’s Abe Foxman a number of times to talk security issues in the Middle East and at one point was asked to address the ADL. We’re told he will be the first sitting defense secretary to address the ADL in almost 20 years. Also there tonight? Leon Panetta, former SecDef in from California, who will receive an award from the ADL for a lifetime of public service.

Hagel talking vets issues tomorrow. Tomorrow morning, Hagel will participate in a roundtable discussion with business leaders and vets groups to talk about the way in which the private sector is working to help support veterans in transition in terms of employment, education and housing.

The Merkel tap offers a peek into a vast spying network. The NYT’s Mark Mazzetti and David Sanger on Page One: It was not obvious to the National Security Agency a dozen years ago that Angela Merkel,  rising star as the leader of the Christian Democratic Union, was a future chancellor of Germany. But that did not matter. The N.S.A., in a practice that dates back to the depths of the Cold War and that has never ended, was recording her conversations and those of a range of leaders in Germany and elsewhere, storing them in databases that could be searched later, if the need arose…How the N.S.A. continued to track Ms. Merkel as she ascended to the top of Germany’s political apparatus illuminates previously undisclosed details about the way the secret spy agency casts a drift net to gather information from America’s closest allies. The phone monitoring is hardly limited to the leaders of countries like Germany, and also includes their top aides and the heads of opposing parties. It is all part of a comprehensive effort to gain an advantage over other nations, both friend and foe." More here.

The NSA has secretly broken into the main communications links that connect Yahoo and Google data centers across the globe. The WaPo’s Barton Gellman and Ashkan Soltani: "By tapping those links, the agency has positioned itself to collect at will from hundreds of millions of user accounts, many of them belonging to Americans. The NSA does not keep everything it collects, but it keeps a lot. According to a top-secret accounting dated Jan. 9, 2013, the NSA’s acquisitions directorate sends millions of records every day from internal Yahoo and Google networks to data warehouses at the agency’s headquarters at Fort Meade, Md. In the preceding 30 days, the report said, field collectors had processed and sent back 181,280,466 new records – including "metadata," which would indicate who sent or received e-mails and when, as well as content such as text, audio and video." Their piece, which includes the chicken scratch drawing of the "Google Cloud Exploitation," here. The cutline under the drawing in the WaPo: "In this slide from a National Security Agency presentation on "Google Cloud Exploitation," a sketch shows where the "Public Internet" meets the internal "Google Cloud" where user data resides. Two engineers with close ties to Google exploded in profanity when they saw the drawing."

Former intel officials and tech industry folks are PO’ed about the latest revelations on the NSA. FP’s trio Shane Harris, Noah Shachtman and John Hudson: "Former intelligence officials and technology industry executives reacted with anger and anxiety over the latest revelations that the National Security Agency is reportedly infiltrating some of the world’s biggest technology companies and making off with the private communications of millions of their customers. And if the reports are accurate, it could be very bad news for U.S. technology companies, who have been complaining for months that their government’s secretive intelligence operations are threatening their business and driving customers towards their foreign competitors.

"‘I think they’re in an almost impossible situation,’ Rep. Adam Schiff, a senior member of the Intelligence Committee, told The Cable. Speaking of Silicon Valley firms who are obligated to cooperate with the NSA, Schiff said recent leak revelations threatened to negatively impact their bottom lines. ‘It’s definitely going to hurt their business and I think we ought to do everything we can to mitigate that damage. I’m very sympathetic to what they have to confront.’ The Washington Post reported today that the agency ‘has secretly broken into the main communications links that connect Yahoo and Google data centers around the world.’ According to documents provided by former NSA contractor Edward Snowden, the agency is intercepting emails, documents, and other electronic communications as they move between the companies’ privately controlled facilities and the public Internet, giving the NSA access to data in nearly real-time." Read the rest here.

Welcoming Dan Lamothe to FP and celebrating his inaugural piece – done in his first three days on the job – "The Most Crooked Cop in Afghanistan," a story not only about an Afghan police chief accused of sexually abusing teen boys and U.S. Marines’ efforts to have him removed, but one on a host of other crimes, from extorting money form civilians, operating illegal security checkpoints and working with the Taliban – selling it weapons and police uniforms. Lamothe: "The accusations are outlined in a witness statement submitted in support of Marine Maj. Jason Brezler, who faces an administrative hearing in which Marine Corps officials could toss him out of the service for warning fellow Marines about Sarwar Jan through an email on an unclassified network. One month after Brezler sent that message to Afghanistan, Sarwar Jan’s teenage servant, Aynoddin, allegedly opened fire on Marines working out in a dusty gym at Forward Operating Base Delhi in Helmand province. Staff Sgt. Scott Dickinson, Cpl. Richard Rivera and Lance Cpl. Gregory Buckley – all members of a police adviser team attached to 3rd Battalion, 8th Marines, from Camp Lejeune, N.C. — were killed in that Aug. 10, 2012 insider attack. A fourth Marine, Staff Sgt. Cody Rhode survived, but sustained five gunshot wounds." More here.

Rosa Brooks’ argument on FP: If all kids don’t have chips implanted in them, then the terrorists win. OK, not really, but still. Reading Rosa: "What if I told you that nine out of ten terrorist plots in the United States could be thwarted via a simple technological expedient? It will be easy. At age 12 (or at whatever age he or she enters the United States), every U.S. citizen or visitor will be required to have a tiny tracking chip painlessly implanted in his or her forehead. The chip will be microscopic and almost invisible to the naked eye (although for a small fee, chips will also be made available in a wide variety of sizes, colors, and styles for those who prefer something a bit more decorative). Despite their small size, each chip will be equipped with a GPS, a camera, and an audio-recording device. The chips will be powered by the body’s own heat, supplemented during the day by solar energy. They will be waterproof, tamper-proof, and non-removable, and they will relay a constant stream of real-time information to computers maintained by government law enforcement personnel." Read the rest here.

Who knew? A shortage of Catholic chaplains in the military poses a problem. U.S. News’ Paul Shinkman reports, here.

Merging the Air Force Reserve with the Air National Guard = bad idea, according to Air Force Reserve leaders. That bit on CNAS’ Web site, here.

A Florida Marine opens his home to the Afghan who saved him, by the Tampa Tribune’s Howard Altman, here.