Max Baucus, the U.S. ambassador to China, started his workweek Monday by urging China’s state-owned enterprises to invest in American infrastructure projects. “There is a huge opportunity,” he told a forum at the U.S. Embassy in Beijing that was attended by scores of Chinese and U.S. executives.
While Baucus was looking for Chinese investment, U.S. Attorney General Eric Holder was preparing to announce an indictment against five Chinese military officers. Holder would accuse them of hacking into U.S. companies’ computer systems on behalf of unnamed Chinese state-owned enterprises _ including possibly some that the United States is courting for investment.
To many analysts, the juxtaposition of the two events Monday reveals how bifurcated U.S. policy toward China has become. On any given day, it can swing between indictments and ceremonial toasts.
Some journalists try to be nice guys. Instead of “bifurcated” try “lying” and “hypocrites”.
Here in Beijing, Baucus’ efforts to court Chinese investment were quickly overshadowed by what China called “fabricated” accusations against its military officers. By Tuesday, China’s official Xinhua news agency was reporting that Baucus had been summoned to the Foreign Ministry to explain the U.S. position and make amends.
Adam Segal, a cyber security expert at the Council on Foreign Relations, said he was surprised that the Obama administration decided to issue the indictments, the first U.S. prosecution against a foreign country’s military for economic espionage. “The public ‘naming and shaming’ has been a big part of the picture since a year ago,” he said, but is unclear how effective it has been…
Unlike in the United States, China’s economy is dominated by more than 100 major state-owned enterprises. These include companies involved in steel manufacturing, nuclear power and solar power _ the sectors named in the indictment as targets for China’s U.S. hacking.
It’s long been known that China’s military has close ties to the enterprises. It’s been suspected for almost as long that the military uses its cyber warfare capabilities to give those industries a competitive advantage. That was backed up in 2013 by a detailed investigation by Mandiant, a private cyber security company. Mandiant revealed that a Shanghai-based espionage unit of the People’s Liberation Army had engaged in years of cyber attacks against U.S. companies and defense installations.
“This issue poses a serious threat to the stability of U.S.-Chinese codependency,” writes Stephen Roach, a senior fellow at Yale University’s Jackson Institute for Global Affairs, in his new book, “Unbalanced.” Unlike issues such as unfair trade practices, he writes, hacking doesn’t lend itself to a process of negotiation and adjudication.
Indeed, it now appears that the only avenue for negotiation has been suspended, if not permanently shut down. In response to Monday indictments, China said it would no longer attend a working group made up of senior officials from both countries to resolve complaints about cross-border hacking…
Some observers doubt the indictments will do anything but send a symbolic message to China, and even that isn’t likely to budge Beijing. As reflected in China’s state media, Chinese officials view the United States as a hypocrite on cyber spying in the wake of Edward Snowden NSA-spying revelations.
Yesterday, our DOJ revealed its shocking new revelations which led to the indictment in absentia of Chinese military for cybercrimes. It turns out to be the Mandiant Report which has been in the public domain for seventeen months. Our fearless leaders are not only hypocrites, they must presume most Americans to be stupid and/or ignorant.
The ignorant part of the equation is aided, of course, by national and local media which will not get off their dusty butts sufficiently to read back through previous articles or query an expert like Stephen Roach whose task for decades was to advise American finance on what was actually going on in distant Asia. As far as I’ve seen, only Bloomberg TV has asked Professor Roach about the indictment – and it was he that I saw on that business channel, this morning, taking appropriate umbrage at the hypocrisy of our government spoon-feeding NSA spooks while declaring outrage over “our” corporations being spied on – on the basis of a report from 2012.
China spies on companies and it’s not evil in their eyes. Our government spies on us – as well as spying on allies and other national corporations like Petrobras in Brazil – and it’s not evil in their eyes. Of course, we have a Supreme Court that worries about defending corporate “people” – so, there is that added extra layer of deceit we can take pride in.