In part two of 'The Coming Chinese Storm', former Deputy Director for Counterintelligence at the CIA's National Clandestine Service, Mark Kelton, lays out the Chinese threat to both the public and private sectors in the U.S.
"As General Michael Hayden has rightly said: “This is stealing American wealth. It’s stealing American jobs. It’s stealing American competitive advantage,” wrote Kelton in part one. Part two explains in more depth, just how they're doing it.
The recent upswing in Beijing’s espionage activities is not only indicative of improved human and cyber espionage capabilities, it is the intelligence manifestation of a profound change in Chinese strategy, an undertaking in which the whole of the Chinese Communist Party and government - if not the whole of the nation - is involved. Beijing’s goal is to erode and, over time, negate the relative U.S. strategic advantage over China. Factors driving this aggressive shift in strategy are at once instructive and disquieting. They include:
- Chinese aspirations to reverse the world order, and to position ‘the Middle Kingdom’ at its center. As Gordon Chang has noted, though it might sound ludicrous to many Americans, “China’s endgame is ‘World Domination’.”[1] That intent was underscored recently by Chinese president Xi Jinping. Speaking in response to President Trump’s April 2018 signing of the Taiwan Travel Act, Xi promised “full reunification of the motherland”, using bellicose language that referred not only to the seizure of Taiwan, but also to Indian, Japanese, South Korean and Philippine territory as well as virtually the entirety of the South China Sea. ‘We are resolved,’ Xi said, ‘to fight the bloody battle against our enemies with a strong determination to take our place in the world.’[2]
- A corresponding belief that the U.S. is in decline and that China can act both to hasten that demise and to capitalize upon it. Crucial to that undermining of America’s role in the world is using intelligence means to degrade what the Chinese understand to be our strategic center of gravity: our industrial, financial and technological capabilities.
- The growing realization that, as China’s economy slows, it is increasingly unable to meet the demands of its people. This necessarily calls into question the implicit bargain the Chinese Communist leadership made with the people wherein the communist system would remain in place in exchange for the Party opening the door to the outside enough to increase the well-being of the population and to build the country’s economic strength (and consequently its military power). China’s leaders surely recognize, as demonstrated by extensive Soviet collection of scientific and technical intelligence in the 1970’s and 80’s, that even massive theft of western know-how may not compensate for the economic inefficiencies and contradictions inherent in their own system. They will, therefore, likely continue trying to re-direct building popular dissatisfaction towards external foes, real and state-generated, with all that portends for fanning the flames of war.
- And past American failure to vigorously counter Chinese intelligence attacks on U.S. government and industry. Conditioned by years of the U.S. not responding, or responding ineffectually (e.g. indictments of Chinese intelligence personnel that will likely never be acted upon), to its activities, China now greets with contempt, U.S. demands that it cease those actions, denies any role in them, and continues apace.
Reflections of this aggressive shift in Chinese strategy abound. Internally, Xi has consolidated his power base in the Communist Party, military and security forces, in a manner not seen since Mao. Xi has also presided over the most intense repression of Christians and other religious minorities since the Cultural revolution[3] as well as an erosion in the civil liberties agreed as part of the British hand-over of Hong Kong to China.
Externally, Chinese expansionist goals extend far beyond demands that Taiwan acknowledge Beijing’s suzerainty and assertions of control over waters and territories to which others have equal or better claim. The so-called ‘Belt and Road Initiative’ (BRI) is intended to extend China’s strategic reach and ability to project force through infrastructure projects over which Beijing exercises control or influence on terms favorable to China. Though the BRI is focused on expanding Beijing’s power in East and Central Asia in a manner cynically akin to Imperial Japan’s ‘Greater East Asia Co-Prosperity Sphere’, it also includes areas geographically distant from China. Specifically, it seeks to secure Chinese presence in regions of strategic import world-wide; to ensure Chinese access to crucial minerals and commodities; and to increase international reliance on Chinese technology. Central to the latter goal are the so-called ‘Digital Silk Road’ and the ‘Made in China 2025’ initiative, plans intended to expand the telecommunication market share of Chinese companies, principally HUAWEI; to increase the opportunity for theft of technology and intellectual property (either directly or via proxies); and, not coincidentally, to enhance Chinese intelligence collection.
Under President Trump, the U.S. has rightly continued to engage Beijing on issues of import, such as North Korea. At the same time, with actions such as the imposition of tariffs intended - in part - to curb Chinese technology theft and disinviting China from this year’s RIMPAC naval exercise, Washington has signaled that it will move decisively to deter and, if necessary, to confront the growing danger of Chinese expansionism.
For deterrence to succeed (and to best prepare us for any conflict should it come to that), additional steps need to be taken to harden the U.S. as a target in the face of the ongoing Chinese intelligence onslaught and to promote a return to the concept of the U.S. as ‘The Arsenal of Democracy’ wherein industry and government work closely together to promote and protect the national security the former builds and the latter executes. Those measures include:
- Enactment of the Foreign Investment Risk Review Modernization Act, which includes provisions that enhance Committee on Foreign Investment in the United States (CFIUS) authorities by expanding its jurisdiction in reviewing foreign investments in American critical technology companies and infrastructure by countries, entities or persons posing a threat to national security.
- Closer cooperation between American government and industry in building a secure 5G network that promotes the free flow of information; ensures U.S. dominance in the telecommunications infrastructure, manufacture and operation; and thwarts the threat to 5G posed by such firms like HUAWEI and ZTE, thus denying China potentially decisive political, economic and military advantages.
- Establishment in other critical sectors of organizations such as the Financial Systemic Analysis and Resilience Center, which works with industry partners and government in promoting the sharing of threat information and in identifying, analyzing and coordinating the mitigation of risks to the U.S. financial system.
- Development and maintenance of databases on Chinese nationals living in the U.S. who pose actual or potential CI threats and neutralization of Beijing-funded influence entities, such as the so-called ‘Confucius Societies’ on American college campuses.[4]
- Better resourcing of, and granting of, necessary additional authorities to the National Counterintelligence and Security Center to ensure that it can effectively oversee and coordinate such key initiatives as putting in place effective insider threat programs, implementing continuous evaluation and clearing up the security clearance backlog within government, while at the same time enhancing its private sector outreach on CI and security issues.
- Increased funding and staffing for U.S. CI organizations to ensure mission effectiveness and to allow for the continuing development and retention of CI professionals.
- And redoubled efforts by U.S. intelligence organizations, independently or jointly as necessary, to penetrate their Chinese adversaries.
While writing this article, and having failed to find the source of that “single breeze” saying, I asked my friend about it. He told me that he had forgotten where he first heard it and that he had been unable to find the exact Chinese quotation. ‘Maybe’, my friend mirthfully quipped, he had ‘gotten it from a fortune cookie’.
For our part, if we are to ward off the intelligence storm coming from China, we cannot rely on chance. We will have to make our own fortune. And we will have to start doing so before that storm carries the clouds of war to us.
[1] See Gordon G. Chang’s interview in Breitbart News, “China’s Endgame is ‘World Domination’”, March 08, 2018. [2] Gordon G. Chang, “The World Should Take China’s War Threats Seriously”, The National Interest, March 23, 2018. The Taiwan Travel calls for visits by American officials to the island and reciprocal trips by Taiwan officials to the U.S. [3] Bradford Richardson, “’Human Rights Disaster’: China’s Persecution of Christians at Highest Level Since Mao”, The Washington Times, June 6, 2018; citing ChinaAid. [4] Joel Gehrke, “Senators to Colleges: Reveal Foreign Agents on Campus”, The Washington Examiner, March 21, 2018
