My guess is it went a little like this...
Spook #1: Well, to spy on terrorists it will take a lot of time effort and money. Congress will have to increase our budget.
Head Spook: I see. Well, that's going to make my job difficult.
Spook #2: Or how about we just spy on everyone so we can blackmail the President, Senate Intelligence Committee, whistle-blowers, the media and anyone who tries to get in our way?
Head Spook: Spook #2, congratulations! You're the new Spook #1.