Obama considers retired general for foreign policy post

President-elect Barack Obama seen during a meeting in Obama's transition office in Chicago in this November 17, 2008 file photo.

CHICAGO (Reuters) - Retired Marine Gen. James Jones emerged as a leading contender for White House national security adviser as President-elect Barack Obama worked on Thursday to assemble his foreign policy team.

New York Democratic Sen. Hillary Clinton was on track to be named secretary of state, but a Democratic official said Obama was not planning to announce his foreign policy team until after Thanksgiving on Nov. 27.

Clinton moved closer to taking the job of top U.S. diplomat after her husband, former President Bill Clinton, offered to allow ethics reviews of future business and charitable activities.

The Obama team had been concerned that some of the former president's globe-trotting activities, such as his philanthropy and paid speeches might pose a conflict of interest should his wife become secretary of state.

But financial disclosure issues have been ironed out, the Democratic official said.

Democratic sources said Jones, the former top operational commander of NATO, was in the running for the job of national security adviser along with James Steinberg, who was deputy national security adviser in Bill Clinton's administration.

An ABC News report said Jones was Obama's preferred candidate and the president-elect valued in particular his more-than four decades of military experience.

Jones is widely respected by both Democrats and Republicans but has avoided aligning himself with either party.

He is known to have been a strong critic of the Bush administration's handling of the Iraq war and is quoted as describing the war as a "debacle," in Washington Post journalist Bob Woodward's 2006 book "State of Denial."

While refusing to confirm it, Jones has not disputed the quote, published while he was still serving at NATO.

Woodward also reported that Jones believed former Defense Secretary Donald Rumsfeld had "systematically emasculated" the U.S. military's Joint Chiefs of Staff.

Jones grew up largely in Paris, France, and graduated from Georgetown University's School of Foreign Service.

OVERSEAS UPBRINGING

The ABC News report said Obama, who spent part of his childhood in Indonesia, feels a kinship with Jones because of his upbringing overseas.

The national security job coordinates among the various foreign policy players in the administration, including the secretary of defense and the director of national intelligence. The person in that role would be Obama's closest adviser on foreign policy on a day-to-day basis.

As Obama was narrowing his choices for national security adviser, Arizona Gov. Janet Napolitano was seen by many Democrats as a strong contender to head the Homeland Security Department, created to protect Americans after the Sept. 11 attacks in 2001.

Napolitano, 50, is a former U.S. attorney for Arizona and state attorney general, giving her substantial law enforcement experience. As governor of a state that borders Mexico, she is closely involved in immigration issues, which also come under the department's jurisdiction.

Two Democratic sources said Napolitano was the leading candidate for the job.

ABC News also reported that retired Adm. Dennis Blair was the top candidate to be the director of national intelligence.

(Additional reporting by Randall Mikkelsen)