China Ramps Up Espionage Against U.S.

 

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November 20, 2009

China is sharply stepping up espionage against the United States as the rising Asian power grows more sophisticated in cyber warfare and spy recruitment, a report to Congress warned Thursday.

"China is changing the way that espionage is being done," said Carolyn Bartholomew, the chair of the U.S.-China Economic and Security Review Commission.

In its wide-ranging annual report to Congress, the commission reported a steep rise in the disruption and infiltration of websites of the U.S. government and perceived Beijing rivals such as Tibet's exiled leader the Dalai Lama.

Col. Gary McAlum, a senior military officer, told the commission the U.S. Defense Department detected 54,640 malicious cyber incidents to its systems in 2008, a 20-per-cent rise from a year earlier. The figure is on track to jump another 60 per cent.

While the attacks came from around the world, the commission said China was the largest culprit. Some Chinese "patriotic hackers" may not receive official support, but the report said the government likely planned to deploy them in a conflict to disrupt a foreign adversary's computers.

The commission found China was the most aggressive nation in spying on the U.S. and was trying to recruit more Americans as spies.

While China historically tried to tap Chinese Americans--believing, often incorrectly, that they would be sympathetic--it was now turning to the Soviet model of seeking to bribe informants with cash and gifts, the report said.

It said the Chinese were also expanding "false flag" operations, in which sources are deceived into thinking they are providing information elsewhere.

The commission also found China has launched an effort to influence U.S. think-tanks and academia by rewarding scholars with access and depriving visas to more critical voices.

"It becomes self-censorship. If you're in graduate school and want to become a China scholar, you need to go to China. And if you criticize the Chinese government on certain things, you won't get in," said Bartholomew, a former top aide to House Speaker Nancy Pelosi.

"What it means is that we have a generation of China analysts who are being created who don't necessarily have the freedom or the ability to think through a broader range of questions," she said.

The commission also criticized China on its trade policy, recommending the U.S. press Beijing to make its yuan more flexible and to turn to the World Trade Organization to fight predatory trade practices.

"Just look at the sheer statistics," Bartholomew said. "Two hundred-and sixty eight billion dollars in 2008 was the U.S. trade deficit with China --you can't say this (trade policy) has been working."

President Barack Obama this week paid his first visit to China, which is now the top holder of the ballooning U.S. debt. His administration has sought co-operation with China on battling the global slowdown and declined to accuse Beijing of manipulating its currency.

The commission paid a field trip to Rochester in upstate New York, where it said core industries were struggling against Chinese competition that often enjoys state support.

"For 20 years we have watched China policy be controlled really by a handful of large multinational corporations. They're the ones who determine the interests," Bartholomew said. "But there are a lot of constituency interests out there--particularly small and medium-sized enterprises-- that are being hurt by the current U.S.-China policy