The Intelligence War between China and the United States

“The more the geo-economic contrast between the United States and China mounts, the more intrusive actions will be taken by China in the United States, as well as ‘harsh’ counter-intelligence operations.” Analysis by Prof. Giancarlo Elia Valori

Photo: AP

The economic and intelligence tension between the United States and China is currently at its peak since the end of the Cold War. During that phase, however, China had also taken actions to oppose the Soviet Union, with the opening to the United States and the "ping-pong diplomacy" in the early 1970s, as well as its tacit support to Kissinger’s resolution of all tensions between the United States and the Southeast Asian countries.

At the time China wanted to help the United States to regionalize – in Asia – its historic "Northern enemy," namely Russia.

In his "Three Worlds Theory," Mao Zedong placed it together with the United States in the "First World," as both imperialist powers, while he regarded China as the current and future leader of the whole Third World fighting against the "metropolises" of the First World.

Said project has not changed, it has only changed its language and its procedures.

Now that the bilateral tension between the United States and the People's Republic of China is at its highest, the rationale for this new Sino-American scenario is simple. China wants to achieve global geopolitical hegemony, while the United States led by President Donald Trump wants to rebuild its new economic and purely financial hegemony, and hence resort to protectionist practices.

The practices that even the old liberal handbooks of economic science considered lawful when a "nascent industry" needs to be protected.

China has Africa in its hands now – a continent where the US power is linked almost exclusively to the US Africa Command, which is headquartered at the Kelley Barracks in Stuttgart.

Europe, of course, does not count for anything.

Moreover, China operates in Iran and also in Russia, considering that it has now incorporated Russia into its Belt and Road project towards Europe and the Mediterranean – in spite of the Eurasian Alliance project of Russian origin – and hence operates as a hegemonic power in Central Asia.

It does so by operating with a strategy that is at first economic, but also and above all political: the peripheries of the world against the metropolises, i.e., Mao’s old "policy line."

Currently, we are instead shifting from geo-economy to the real global strategy – and China will have no particular difficulty in moving from a generically friendly position towards the United States to a far more adverse one.

When its primary interests are attacked by US actions, China will never make the first move.

The Thirty-Six Stratagems of the Chinese secret art of war are clear in this regard: "Watch the fires burning from the river" and also "Hide a knife behind a smile."

However, let us better analyze what has happened in the current "spy war" between the United States and China.

For nearly ten years, the US spy network in China has been severely undermined, if not wiped out. This has also happened to the US intelligence services elsewhere.

Allegedly, the vulnerability of the US network results from the fact that China has long "penetrated" the network used by the operatives and informants present in China.

China maintains that this has led to the "elimination" of 30 local citizens who worked for the United States and the imprisonment of an unknown number of others.

China's counter-intelligence operation is said to have started in 2010, when the encrypted firewall used by the US operatives in China was discovered.

Obviously, it is almost useless to add that the "sophisticated" IT firewall used by the CIA is now in China’s hands and the analysts of its intelligence services will use and implement it even more easily.

Moreover, the program discovered by China had to be used in such a way as not to connect with and not to be traced by CIA’s major IT networks.

Without CIA knowing it, however, the encrypted system could also connect with its primary web network - and China could listen or read quietly and easily.

Incidentally, it is currently certain that all countries’ intelligence services can use the Web, but it is equally certain that the security of communications is at least the top goal, together with the quality and depth of the intelligence and analyses reported to the "central unit."

Nevertheless, the more the Web gets complex, the easier it is "penetrated." This law has been never denied by facts.

The more complex it is, the easier is to manipulate or "penetrate" it.

Experts tell us that the Web’s rate of complexity increases by seven the danger it can be penetrated. At every additional step of structural complexity, there is a 7-time multiplier for possible "holes."

Hence, in many cases, it would be good to still resort to the old craft systems that made the history of modern intelligence. China still does it.

We believe, however, that the real problem lies in the fact that the United States still believes that China is a country which is trying – with some difficulty – to follow the development course of the Anglo-Saxon community.

This is certainly not the case: China has not long been a "second-class" nation or, as some US analysts say, a "Third World country that has grown too much."

Far from it: it is a good thing that the United States soon realizes that China is certainly the second military and economic power in the world and that it can certainly cooperate with the United States, but dictating at least some essential conditions.

No Chinese decision-maker thinks about a "covert war" against the United States – not even remotely: the Party and the State currently think about other "enemies" and other regions.

However, we should never forget China’s huge power of constraint, persuasion, and negotiation.

Moreover, the free market myth has affected the whole system of what – in the intelligence community of every modern country – should be the axis of all major operations, namely influence.

Over 110 "Confucius Institutes" have been founded in the US universities and huge Chinese capital is present in many of the most important US entertainment companies, such as Legendary Group, AMC Theaters, STX Entertainment, Studio 8 and Global Road Entertainment, as well as in many other smaller companies.

Not to mention Chinese investments in other sectors and in US Treasury securities.

The US majors obviously sell much in China, but China has entered their system with money, not just with encrypted firewalls.

Clearly, China is strongly interested in the US operations on its territory, but the Chinese leaders certainly have operated a linkage between the trade wars started by President Trump and their counter-intelligence actions.

This is another bond to break.

The more the geo-economic contrast between the United States and China mounts, the more intrusive actions will be taken by China in the United States (such as those of the many Chinese students in North American universities who are spying for their country of origin), as well as "harsh" counter-intelligence operations.

Furthermore, what some leaders of the US Central Intelligence Agency fear is partly true: China is now in such a Cold War phase with the United States as to eventually oust it from its position as a global power.

It is very unlikely, however, that Chinese leaders think they can weaken the US power in a short lapse of time: there is no blitzkrieg or lightning war that can decide, in a short sequence of clashes – even in the muffled world of intelligence or in the slightly noisier world of electronic war – who definitively wins.

It is pure madness, and the Chinese are not mad at all.

Obviously, both contenders must well understand that the Great Powers – if they have to disappear – do so throughout centuries, always much more slowly than they have grown in good times.

Certainly, even traditions count in the world of intelligence.

The United States is the realm of technology, in which an American – a good American and not an ugly American like the one described by the British novelist and intelligence agent, Graham Greene, who had titled his novel The Quiet American – believes blindly. The ugly and the good are probably two sides of the same coin.

The tradition of Chinese intelligence is also excellent in technology, but it does not forget the ancient rules of power and war.

When some defecting KGB men were sent to some US military academies, they were surprised that in the libraries there were not the classics of Eastern war thought and strategy: the Thirty-Six Stratagems, the Liezi, as well as Sun Zu’s military treatise The Art of War.

Hence, too much technology in the United States and sometimes a certain tendency to conceptual hyper-simplification; too little history and knowledge of the real power structure which – when really powerful – is covert.

China is not lagging behind in the field of technology. We should recall the hacking of over 30 companies among the most important ones in America, including Apple and Amazon, with a modified chip. The Silicon Valley is now full of spies who work for the Chinese government for money or other reasons.

According to many officers of the Armed Forces, all the US military networks are in danger.

The CIA, too, has successfully carried out some operations on Chinese territory, sometimes forcing the Chinese to give up their electronic espionage techniques, and also using Chinese intelligence agents.

Hence, what can we do to stop, slow down, and put in an acceptable position of "security and business as usual" this crisis between China and the United States, which – apart from trade wars – is still a mere war between intelligence services?

A first solution could be extensive and universal protection – to be reached and signed as soon as possible – for the protection of sensitive intellectual property.

Currently, trade secrets and patents are acquired not with old reverse engineering, but with the launch of IT attacks on companies and even law firms that hold regulations and protections.

While, as is well known, China is now a global software producer, it would be rational that even China would adapt to a new, stricter and safer international regulation of IPs and networks.

There could also be – in the offing – an international agreement on web addresses and network security, organized by the major companies operating in the sector, which are all interested in achieving a higher security level.

The US Invention Secrecy Act dates back to 1951 and it is too old for the technologies it should protect. Moreover, it is not part of the US intelligence chain.

In fact, the large US companies have increasingly relied on international laws for the protection of industrial data, often coming out of the North American judicial and legal system.

This is another "hole" that the United States must fill as soon as possible.

Moreover, now the US military can control patents, even when they are fully developed in the civilian sphere.

This is a good thing, but the law is one thing and counter-intelligence is another.

However, the Web is and always will be wide-meshed: Google, in particular, is used by 67% of all Internet operators in the world and it has never made a secret of wanting a US patent system as "weak" as possible.

Google itself wants to sell trade secrets at a low price and quickly – and possibly keeping its own ones very secret.

The classic case of a paradox generated by a technology that does not find the legal mesh suitable for regulation.

Furthermore, China adheres to all international intellectual property regulations, but also in China, it is precisely the complexity and the inevitable archaic nature of rules compared to the speed of technology that impose the aforementioned "wide mesh" to China’s patent protection.

Hence, two things are needed: firstly, a technical-legal and bilateral conference between China and the United States, with a view to regulating the specific needs of sensitive data protection.

Moreover, light is better than darkness, although the Chinese wisdom tradition maintains that it is necessary to "cultivate darkness" – as when you need to grow rhubarb.

Secondly, a US-Chinese committee should be established at the highest possible level, where one asks the other for the patents it needs – obviously against payment.

Later, a "third" committee should be created to check the efficacy of the agreement, possibly made up of members of the intelligence community of a country that is good for both countries: Italy, for example, which is second to none in the field of cybersecurity and can guarantee both contenders.

Thirdly, an international conference should be held – again possibly in Italy – to draw up specific rules for "technology secrets," to be adapted each year according to new technologies.

Obviously, also a new international authority would be needed to coordinate and control – above all – the private network managers and the content collectors, as well as websites.

The Internet Corporation for Assigned Names and Numbers (ICANN), the Californian organization that – as we may all recall – was given the Internet "source code" by the US government, is still a cooperative incorporated under California’s law, although the source code is now an open secret, and former President Obama decided it to be managed not only by ICANN.

Hence, ICANN is still a structure that is only responsible for "opening" the network, as well as for dissemination and "transparency."

The Web, however, must also be a structure controlling data security, reliability, and efficacy.

For each "transparency," a rule of security and control. If the system of intellectual property protection fails, the whole contemporary world will fail.

Hence, we could think of establishing an agency, again in Italy, with the major powers’ support – an agency called Security Agency for the Internet (SAFI), which can remove or report real-time passages of business and State secrets within the whole network.

This is another action that could be taken in Italy.