After Germany expels CIA chief, will US spies back off?

The United States has badly underestimated the level of anger in Germany over its spying operations and the damage could be long-lasting if Washington fails to ease off, former US officials said Wednesday.

Germany's dramatic decision last week to throw out the CIA station chief in Berlin took the Americans by surprise and conveyed a deep frustration with Washington, which has mounted for months since revelations of US eavesdropping on Chancellor Angela Merkel's mobile phone.

"It's unprecedented. And it's an unmistakable signal about unhappiness in the German government," said James Lewis, a former US intelligence official.

The shock move to expel the most senior US intelligence officer in Berlin came after authorities caught the Americans running two alleged double agents employed in government offices, a revelation that represented a last straw for Berlin.

The Germans have a valid complaint to say "this is too much, you've gone too far, you need to back off," said Lewis, a senior fellow at the Center for Strategic and International Studies.

The alleged spying raised questions about whether the White House was keeping a close eye on what its intelligence agencies were up to inside an allied country, and whether it was worth the political cost, experts said.

In one instance, the Americans allegedly paid money to a low-level agent in the BND foreign intelligence service to pass on documents from a parliamentary committee's probe into ex-intelligence contractor Edward Snowden's allegations of US snooping in Germany.

To jeopardize ties with Germany for information that could be obtained without spying suggested a bureaucracy on auto-pilot, said a former Western diplomat.

"It's stupidity beyond belief," the ex-diplomat said.

President Barack Obama's deputies needed to be reviewing any espionage in Germany with "a very high level of scrutiny," said Kori Schake, who worked on the National Security Council under former president George W. Bush.

"People need to be making a very careful risk analysis. And I think at least the German government doesn't believe we are," said Schake, a fellow at Stanford University's Hoover Institution.

- Spying on friends -

Germany has long resented being excluded from the so-called "Five Eyes" arrangement among intelligence agencies from Australia, Britain, Canada, New Zealand and the United States.

The five English-speaking countries, whose club dates back to the early days of the Cold War, share intelligence on a large-scale while pledging not to spy on each other.

But the Obama administration, like its predecessors, is not ready to open the door to Germany, partly because Berlin has not been willing -- or able -- to gather intelligence in as aggressive manner as members of the "Five Eyes" circle, experts said.

There has been discussion more recently of a separate "no spy" deal for Germany, but officials on both sides say the idea has gone nowhere and is unrealistic.

"It's not a matter of an understanding with the other country," a former US intelligence officer said on condition of anonymity.

"It's a matter of one's own risk calculations. That's the way it's always going to be."

Spying on friendly countries is useful and sometimes necessary as US leaders want "to have as much perspective as they possibly can as to what the thinking of those other countries is" before entering into pivotal negotiations, he said.

Some American experts also argue that Washington has a legitimate reason to be concerned about Russian influence and espionage in Germany, a charge that German officials dismiss.

Even if Washington is not ready to renounce spying in Germany, it will have to set stricter limits on its espionage to rebuild trust, said Kevin Ryan, a retired US general and a fellow at Harvard University's Belfer Center.

Ryan said that "we have to change our approach somehow so we're not pissing off our number one partner in Europe."

The next CIA station chief will have to apologize and outline how Washington would change its approach going forward.

US and German spy agencies will likely return to their customary cooperation soon enough, partly because the two countries share common interests and partly because Berlin is not ready to go it alone and build up its own security apparatus.

But the political damage is still playing out, and if Washington fails to heed the warning signs, future German leaders may lose faith in the alliance.

The row already has colored German perceptions of a proposed transatlantic trade deal, an idea that faced skepticism in Europe even before the flap over spying.

Some in Germany point to the episode and say, "if you can't trust them, then you don't want to engage with them in a trade relationship," said the former Western diplomat.

"It's going to define how a lot of people see the US for a long time."