COLL ON PANETTA.

Steve Coll has the smartest take on Panetta's appointment that I've seen:

The C.I.A. directorship is a diminished post, no longer in charge of the full intelligence community and subordinate to the Director of National Intelligence (who will apparently be Dennis Blair, a retired admiral.) Still, the C.I.A. director has four important jobs: manage the White House relationship; manage Congress, particularly to obtain budgetary favor; manage the agency’s workforce and daily operations; and manage liaisons with other spy chiefs, friendly and unfriendly. Panetta is thoroughly qualified for the first two functions but unqualified for the latter two. He seems to have been selected as a kind of political auditor and consensus builder. He will make sure the White House is protected from surprises or risks emanating from C.I.A. operations; he will ensure that interrogation and detention practices change, and that the Democratic Congress is satisfied by those changes; he will ensure that all of this occurs with a minimum of disruptive bloodletting.

Coll's conclusion, however, doesn't rely on any of those jobs, but rather Panetta's unfamiliarity with the substance of what the CIA does:

The essential problem is that Panetta is a man of Washington, not a man of the world. He’s seventy-years-old, spends his time on his California farm, and he’s been out of the deal flow, as they say on Wall Street, for about a decade; he knows California budget policy like the back of his hand, but what intuition or insight does he bring to the most dangerous territories in American foreign policy—Anbar Province, the Logar Valley, the Federally Administered Tribal Areas? Compared to his counterparts in Pakistan, Jordan, Israel, Britain, etc.—the critical relationships in national security that the C.I.A. Director alone can manage—he is a relative novice not only about intelligence operations but also about the foreign-policy contexts in which they occur...Panetta may make the White House feel more secure about unfinished bureaucratic and operational reforms at Langley, but he is unqualified to forge the next-generation spy service that a country with as many enemies as this one has needs and deserves.

You can also take the opposite interpretation. One advantage of avoiding a career professional is that you avoid the grudges and agendas that accumulate over a long tenure in a bureaucratic pressure cooker. Panetta can act as a simple professionalizer, updating the CIA's management structures and advocating for needed appropriations and modernizations. This is the sort of thing Panetta has done before, and he's done it well. Nor need it be true that only the CIA director can tend to top-level relationships. If Panetta makes it known that his deputy is the CIA careerist to interface with, then Britain and Jakarta will take that cue. But this all falls apart if Panetta cannot attract the confidence of his staff and raise the morale of his agency. And it will be a problem if those beneath Panetta don't judge him able to accurately assess their work. It's true, of course, that Panetta has foreign policy experience by virtue of having been Clinton's chief of staff. But as Coll notes, Panetta was chief of staff in the 90s. His tenure in Washington was a long time ago, and much has changed. He's facing down a helluva learning curve.