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How China steals American secrets

April 4, 2012

Wednesday, April 04, 2012, 11:55 AM

OP-ED BY RICHARD A. CLARKE

For the last two months, senior U.S. government officials and
private-sector experts have paraded before Congress and described in
alarming terms a silent threat: cyberattacks carried out by foreign
governments. Robert S. Mueller III, the director of the F.B.I., said
cyberattacks would soon replace terrorism as the agency’s No.1 concern as
foreign hackers, particularly from China, penetrate American companies’
computers and steal huge amounts of valuable data and intellectual
property.

It’s not hard to imagine what happens when an American company pays for
research and a Chinese firm gets the results free; it destroys our
competitive edge. Shawn Henry, who retired last Friday as the executive
assistant director of the F.B.I. (and its lead agent on cybercrime), told
Congress last week of an American company that had all of its data from a
10-year, $1 billion research program copied by hackers in one night. Gen.
Keith B. Alexander, head of the military’s Cyber Command, called the
continuing, rampant cybertheft ‘‘the greatest transfer of wealth in
history.’’ Yet the same Congress that has heard all of this disturbing
testimony is mired in disagreements about a proposed cybersecurity bill
that does little to address the problem of Chinese cyberespionage.

The bill, which would establish noncompulsory industry cybersecurity
standards, is bogged down in ideological disputes. Senator John McCain,
who dismissed it as a form of unnecessary regulation, has proposed an
alternative bill that fails to address the inadequate cyberdefenses of
companies running the nation’s critical infrastructure. Since Congress
appears unable and unwilling to address the threat, the executive branch
must do something to stop it. In the past, F.B.I. agents parked outside
banks they thought were likely to be robbed and then grabbed the robbers
and the loot as they left. Catching the robbers in cyberspace is not as
easy, but snatching the loot is possible. General Alexander testified last
week that his organization saw an inbound attack that aimed to steal
sensitive files from an American arms manufacturer.

The Pentagon warned the company, which had to act on its own. The
government did not directly intervene to stop the attack because no
federal agency believes it currently has the authority or mission to do
so. If given the proper authorization, the U.S. government could stop
files in the process of being stolen from getting to the Chinese hackers.
If government agencies were authorized to create a major program to grab
stolen data leaving the country, they could drastically reduce today’s
wholesale theft of American corporate secrets. Many companies do not even
know when they have been hacked. According to congressional testimony last
week, 94 percent of companies served by the computer-security firm
Mandiant were unaware that they had been victimized. And although the
Securities and Exchange Commission has urged companies to reveal when they
have been victims of cyberespionage, most do not. Some, including Sony,
Citibank, Lockheed, Booz Allen, Google, EMC and the Nasdaq have admitted
to being victims. The government-owned National Laboratories and federally
funded research centers have also been penetrated. Because it is fearful
that government monitoring would be seen as a cover for illegal snooping
and a violation of citizens’ privacy, the Obama administration has not
even attempted to develop a proposal for spotting and stopping vast
industrial espionage. It fears a negative reaction from privacy-rights and
Internet-freedom advocates who do not want the government scanning
Internet traffic. Others in the administration fear further damaging
relations with China. Some officials also fear that standing up to China
might trigger disruptive attacks on America’s vulnerable
computer-controlled infrastructure. But by failing to act, Washington is
effectively fulfilling China’s research requirements while helping to put
Americans out of work. Mr. Obama must confront the cyberthreat, and he
does not even need any new authority from Congress to do so. Under Customs
authority, the Department of Homeland Security could inspect what enters
and exits the United States in cyberspace. Customs already looks online
for child pornography crossing our virtual borders. And under the
Intelligence Act, the president could issue a finding that would authorize
agencies to scan Internet traffic outside the United States and seize
sensitive files stolen from within our borders. And this does not have to
endanger citizens’ privacy rights. Indeed, Mr. Obama could build in
protections like appointing an empowered privacy advocate who could stop
abuses or any activity that went beyond halting the theft of important
files. If Congress will not act to protect America’s companies from
Chinese cyberthreats, President Obama must.

RICHARD A. CLARKE, the special adviser to the president for cybersecurity
from 2001 to 2003, is the author of ‘‘Cyber War: The Next Threat to
National Security and What to Do About It.’’
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