"If we prepare to defend against these emerging threats, we will show terrorists that assaults on America will accomplish nothing but their own downfall," he said in a speech at the National Academy of Sciences.

Mr Clinton insisted that such threats should not cause panic, but said they were a serious long-term concern for Pentagon planners.

He proposed to spend

• $52m to continue procurement of a national stockpile of specialised medicines to protect the civilian population,
• $611m for training and equipping emergency personnel in US cities, and planning and training for weapons of mass destruction contingencies.
• He also wanted another $206m for protecting government facilities, and
• $381m for research and development for vaccines against chemical and germ weapons, new therapies, detection and diagnosis, and decontamination.

Mr Clinton said there was a threat of computer hackers breaking into sensitive government and business computer networks, stealing and destroying information, raiding bank accounts, running up credit card charges and extorting money by threats to unleash computer viruses.

He said the threat was made clear last spring when a satellite malfunctioned, disabling pagers, automatic money machines, credit card systems and television networks around the world.

The presidential co-ordinator for the counter-terrorism effort, Richard Clarke, said there was a threat of "information warfare" in which a rogue nation, terrorist group or criminal cartel could perform a "systematic national intrusion" into computer systems, with effects comparable to the strategic bombing of infrastructure during WWII.

Terrorism expert Bruce Hoffman: "The president is particularly concerned about germ warfare"

"What we're concerned about is in the future, nations will have that same capability to destroy each other's infrastructure, not by bombs, but by cyber attack," Mr Clarke told reporters.

Since the collapse of the Soviet Union, America's armed forces have no equal anywhere in the world.

Shadow of conspiracy

But according to BBC Defence Correspondent Jonathan Marcus some analysts fear that having lost the Soviet Union as a gauge against which to measure its military spending, the US risks conjuring up some vast, shadowy international conspiracy which might resort to chemical or biological attack.

Other experts fear that there may be as great a threat from the fringes of American life, where survivalists and right-wing opponents of the Federal government appear to be taking a greater interest in chemical weapons.