He's right. Many people held in Guantanamo Bay as terrorists are not terrorists at all. But don't worry, they were tortured anyway.
The Bush Administration knew this. They didn't care. All that was important to them was stoking the terror unleashed by Osama bin Laden as a smokescreen for their conservative political agenda. That same kind of fear was also used to justify billions of dollars in government contracting in the Cold War. There's a lot of money in terror for government and military contractors. So you need to keep the old ladies scared.
People ask: how could the CIA miss the fall of the Soviet Union? There was considerable economic and political pressure to build it up. Don't underestimate Congress in this. If the CIA had announced that the Soviet Union was not a threat, Congressmen from all over the country would be calling them up in outrage. After all, spending in their districts might have gone down.
We are spending billions and billions of dollars because the military industrial complex is a fear machine.