Note: "As a policy matter?" As if the issue is for the President to decide. The issue is not subject, under the Constitution, to the exercise of the President's "discretion;" it is a matter for the Constitution to decide, and its terms make clear the President's view of things does not count. The Constitution requires the use of the police power, not the military power, to prevent the commission of crime, of which a terrorist act is one. Tricky phrase: "incapacitate a terrorist threat."
Of course the corollary to Attorney General Holder's response, is that, under the Constitution, the President has "authority" to order killed an American who is "engaged in combat on American soil."
Let's see if we understand this. Was Timothy McVeigh "engaged in combat" when he detonated a bomb underneath the Oklahoma City Federal Building? Were the Weathermen of the 60's "engaged in combat" when they committed violent acts against society? The Black Panthers when they fired bullets at police officers in Oakland, California? A man with a grenade launcher standing in Lafayette Park across from the White House? The rouge cop, Mr. Dorner of Los Angeles, cornered in a cabin in the mountains of Big Bear? Five Saudi-Arabians wielding box-cutters to take command of a commercial jet-liner and fly into a skyscraper? (The violent act is, of course, always a matter of degree, isn't it?)
All these examples represent merely the broad arc of criminal conduct ordinarily subjecting the perpetrator to instant death at the hands of the police force, not the military force, of the State; justification for the instant death being the safety of the police officer attempting to arrest, or the safety of innocent bystanders. So it really is a bit unsettling, isn't it, that the President is claiming for himself standing to inject the military force of the United States into the situation. No, you say? Well, how about this?
Kent State University, 1971: Combat?
Not so simple, is it? Allowing the President to confound the police power with the military power is very dangerous for our civil liberties, which include the right to speak against government policy, as Rand did for thirteen hours on the Senate floor, protest against government policy, and actively seek through means of civil unrest to change government policy.