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China’s Spy Balloon Masks Espionage Iceberg in US

In the middle of February, a week after an American fighter jet downed China’s spy balloon off the Atlantic coast, a diplomat at its foreign ministry sought to turn the fiasco on its head by accusing the United States of launching airships over Chinese territory, too.

After flat denials by seniors US officials, the Chinese spokesperson, who when asked for Beijing’s evidence referred reporters to Washington instead, then complained that the Americans had refused to share details of the balloon debris, which was being examined “behind closed doors.”

“What gives such an investigation credibility anyway?” he asked, in what was the extent of China’s attempt to save face. Beijing’s refusal to concede any wrongdoing was par for the course, subject-matter experts said.

In the meantime, the White House must juggle a red-faced adversary with an expectant public when it decides how much to reveal about the recent findings. The information could solve curiosities including the extent to which China relies on its dirigible program for intelligence, surveillance and reconnaissance, as well as how exactly Chinese leader Xi Jinping was convinced of the utility of a balloon with seemingly limited maneuverability.

For many Americans who saw the white orb traverse the country, it was an introduction to brazen Chinese spycraft, and the incident’s outcome divided opinion, according to a Newsweek poll commissioned last month.

A majority of US adults thought the balloon was a surveillance platform, but a third believed America was flying airships over China, too. Two-thirds of respondents expressed concern about other high-flying objects over North American airspace, while nearly half said they didn’t trust the US government to tell the truth about them, a result that was perhaps difficult to divorce from partisan politics.

In reality, the balloon would’ve been “more of an afterthought” for China’s leaders, said James Lewis, a senior researcher at the Center for Strategic and International Studies and director of its Strategic Technologies Program. “It’s been embarrassing for China, and it’s made them look silly, so I don’t see them expanding it greatly.”

However, China is growing its traditional surveillance capabilities, including its ships and aircraft that operate off sensitivity sites around the world. In the US, Beijing is suspected of strategically acquiring real estate for signals intelligence. And in space, it controls an array of 260 spy satellites, second only to the US, a Pentagon report said last year.

The Chinese government’s increasingly sophisticated cyber spying has enjoyed successes in part thanks to the US’s poorly secured networks, Lewis told Newsweek. It has pursued intellectual property theft with impunity, at times with help from human sources, for 20 years, costing American companies billions of dollars.

“They’re very adept at hacking, and they’ve improved remarkably in the last few years. It had been more of a Wild West culture when the PLA was running hacking, because they would hack for personal gain,” he said, referring to China’s People’s Liberation Army. “Xi Jinping has pretty much got that under control. They’re very aggressive.”

In September 2015, standing outside the White House during Xi’s state visit, former President Barack Obama said their two nations had “reached a common understanding” that would put an end to China’s “cyber economic espionage for commercial gain.”

“We’ve agreed that neither the US or the Chinese government will conduct or knowingly support cyber-enabled theft of intellectual property, including trade secrets or other confidential business information for commercial advantage,” Obama said. “The question now is: Are words followed by actions?”

It was the same press conference where Xi said China didn’t intend to militarize the artificial islands it was constructing in the South China Sea.

“Looking back at the history of the Chinese Communist Party, this sort of espionage activity has been at their core. They don’t regard our laws as necessarily binding. It’s their political culture,” according to Lewis, who said the 2015 understanding ” barely lasted six months.”

“There are implicit signals to tell the other side to back off,” he said—closing consulates, expelling diplomats and imposing trade sanctions. “When a country is caught, they never admit it, but they reduce it, at least for a while. The Chinese have not only not reduced the scope, they’ve increased it. The Chinese aren’t getting the hint.”

National champions of the People’s Republic of China, from telecommunications to aerospace and infrastructure, all have benefited from the illicit acquisition of technology.

“The Chinese have the largest hacking program in the world, by far bigger than every major nation combined. And they’ve stolen more of our personal corporate data than every nation, big or small, combined,” FBI Director Christopher Wray told the Senate Intelligence Committee on March 8.

Avril Haines, the director of national intelligence, cautioned American businesses about the risks of Beijing’s forced technology transfer “to boost its indigenous capabilities.”

“China has laws that allow them to…basically force those companies to provide information that can be helpful to their intellectual property extension and to ultimately advance their own competitiveness in this area,” she said at the same hearing. “And they, through espionage and other means, have also gotten information from our companies even outside of China, and from Western companies, and that in and of itself is an issue.”

“The American idea of ​​separating defense and economy—that’s not the same to the PRC. They are linked in their minds,” said Blake Herzinger, a non-resident fellow at the American Enterprise Institute. “If you have an adversary that doesn’t observe that kind of air gap, then their vision is the one that is true.”

“Many countries do keep that air gap, because it’s a very quick race to the bottom when you have superpowers hacking one another’s national champions and key industries,” Herzinger told Newsweek. “It’s a very dangerous path and it’s regrettable.”

In the middle of February, a week after an American fighter jet downed China’s spy balloon off the Atlantic coast, a diplomat at its foreign ministry sought to turn the fiasco on its head by accusing the United States of launching airships over Chinese territory, too.

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