By Joseph Menn
SAN FRANCISCO, April 9 (Reuters) - The second-ranking official at the U.S. Department of Homeland Security said she will resign shortly, ending four years as a champion of a civilian-controlled Internet.
In an exclusive interview with Reuters, Jane Holl Lute, the sole deputy secretary at Homeland Security, said on Monday she would give notice this week and leave to pursue a role in international Internet affairs.
Lute said that she was leaving with the department on a strong footing in Internet matters, with its central role cemented by an executive order on cybersecurity issued by President Barack Obama in February.
The order directs the civilian Department of Homeland Security to steer improvements in protections for private industry, instead of giving the lead to the military's National Security Agency.
The preeminence of Homeland Security in patrolling the Internet is a big change from when Lute arrived there.
"The national narrative on cyber has evolved," she said. "It's not a war zone, and we certainly cannot manage it as if were a war zone. We're not going to manage it as if it were an intelligence program or one big law-enforcement operation."
The participation of the military and intelligence agencies in monitoring the Internet has not been definitively resolved.
The House of Representatives Intelligence Committee plans to consider a bill on Wednesday that critics say would allow direct sharing of company data with the NSA.
Lute's planned exit follows the recent retirement of deputy under secretary for cybersecurity Mark Weatherford and others with expertise.
"Jane Lute was a relentless voice of clarity in helping to define the proper purpose and role of government in securing the Internet," said Google executive Vint Cerf, a founder of the Internet and co-author of the core protocols for Internet transmission.
"DHS can take advantage of some extraordinary talent at NSA, but it's wise for us to keep that under civilian management. That's the way our Constitution says it's supposed to work."
Lute came to the department under Secretary Janet Napolitano from the United Nations, where she served as an assistant secretary-general supporting peacekeeping missions. She worked at the National Security Council under Presidents George H.W. Bush and Bill Clinton and before that in signals intelligence in the U.S. Army.
Colleagues said her military background helped her stand up against defense officials, including NSA Director Keith Alexander, as they pushed for a greater role.
Speaking privately, these colleagues recalled a meeting in 2011 about expanding a Pentagon pilot program for sharing classified threat information among defense contractors and federal agencies. Lute would not allow it to be expanded unless Homeland Security took control, aides said, and ultimately she prevailed.
"We needed to find a way to share information with the private sector" while preserving civil liberties, Lute said.
Obama's executive order creates similar networks between the government and critical industries beyond defense, and the Department of Homeland Security again is in charge.
Lute's supporters outside the government said they hoped her successor at the department also would make fighting for the agency's role in the Internet a priority.
The 200,000-employee department also is responsible for customs enforcement, immigration services, emergency management and transportation safety.
Lute said countries around the world are still grappling with how the Internet should be treated. Though the Pentagon once spoke of cyberspace as a domain to be "dominated," its language is more muted now.
She said Homeland Security needs to attract and retain more highly skilled security experts. Its recruitment efforts have lagged behind those at the NSA, which has more cachet and a stronger reputation for technical ability.
And she said it was "incomprehensible" that Congress has not yet passed broad legislation that would do more on cybersecurity than Obama's executive order. Recent Senate bills would give companies legal protection for sharing threat data with each other and with DHS.
"We want to build the most secure cyber-economy on Earth," Lute said. "We know what we need to do for that to happen, and the inability of legislation to pass to this point is inexplicable."
Lute said she was encouraged by some movement in the Congress in the past few months and is now more optimistic that a law would pass this year. (Reporting by Joseph Menn in San Francisco; editing by Christopher Wilson)