[Infowarrior] - China's computer hacking worries Pentagon

[Richard Forno]

<http://www.latimes.com/news/nationworld/world/la-fg-uschina4mar04,0,5558366
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China's computer hacking worries Pentagon
A report says the country now has the ability to get into networks
around the world.
By Julian E. Barnes
Los Angeles Times Staff Writer

March 4, 2008

WASHINGTON - China in the last year has developed ways to infiltrate
and manipulate computer networks around the world in what U.S.
defense officials conclude is a new and potentially dangerous
military capability, according to a Pentagon report issued Monday.

Computer network intrusions at the Pentagon and other U.S. agencies,
think tanks and government contractors last year "appeared to
originate" in China, according to the report.

In addition, computer intrusions in Germany, apparently by Chinese
hackers, occur daily, along with infiltrations in France and Britain,
the Pentagon said. Last year, British intelligence officials alerted
financial institutions across the country that they were targets of
"state-sponsored computer network exploitation" from China.

The Pentagon report does not directly accuse the Chinese military or
government of the attacks but says the incidents are consistent with
recent military thinking in that country. David Sedney, deputy
assistant secretary of Defense for East Asia, said cyber-warfare was
an area of growing concern and he called on the Chinese to clarify
their intentions.

"The techniques that are used, the way these intrusions are
conducted, are certainly very consistent with what you would need if
you were going to actually carry out cyber-warfare, and the kinds of
activities that are carried out are consistent with a lot of writings
we see from Chinese military and Chinese military theorists," Sedney
said.

U.S. military officials believe that Chinese cyber-warfare advances,
coupled with China's increasing skill at neutralizing
information-transmitting satellites and other capabilities, is part
of a military objective of crippling potential foes, even those that
may be militarily superior such as the United States, in the event of
an international crisis or confrontation.

The report, an annual assessment of China, also says Beijing has
continued to develop a sophisticated missile program and appears
focused on warding off any U.S. intrusion in the area around Taiwan.

China considers Taiwan part of its territory and has threatened to
take it by force if it declares independence.

"We are fully prepared to repulse any adventurous activities toward
Taiwan independence," Jiang Enzhu, spokesman for China's parliament,
told a news conference today.

Pentagon officials admit that they lack a clear understanding of
China, despite its status as America's second-largest trading
partner. During nearly every U.S. official visit to China, military
officials press Beijing to disclose details of its spending plans and
explain why it is building up its military capabilities.

"The lack of transparency in China's military and security affairs
poses risks to stability by increasing the potential for
misunderstanding and miscalculation," the report says. "This
situation will naturally and understandably lead to hedging against
the unknown."

Beijing announced plans today to increase its military budget this
year by 17.6% to $59 billion. This follows a record 17.8% hike last
year. But Western observers suspect that China's actual military
budget is much larger.

Chinese authorities are careful to downplay their military might,
saying their spending is still a fraction of the American defense
budget and most of the money will go toward peaceful purposes such as
pay raises and equipment upgrades.

The infiltration of Pentagon computer networks has allowed hackers to
tap into unclassified computer systems, Sedney said. But even though
the hackers did not penetrate classified systems, the infiltration
was still considered serious, Sedney said.

"There's a whole range of scientific and technological material that
is available through people in the contracting world and elsewhere
that just isn't classified that can be the subject of these
intrusions," he said.

Sedney said the computer break-ins did not amount to attacks, but he
said the techniques used to penetrate Defense Department computers
also could be used to attack them.

He compared the intrusions to someone breaking into a house but
leaving the valuables in place and instead taking pictures of the
interior.

The U.S. continues to believe that China's ongoing military
modernization is primarily driven by preparations for a potential
future dispute involving Taiwan.

But as the scope of the modernization increases and China's strategic
thinking evolves, U.S. officials believe that China is preparing its
military for other contingencies, such as conflicts over oil reserves
or disputed territories.

The report takes particular note of China's expanding missile
inventory, including long-range missiles, cruise missiles designed to
strike naval vessels and growing numbers of shorter-range missiles.

The primary focus of China's missiles, Sedney said, is Taiwan.

David Helvey, one of Sedney's deputies, said China also has purchased
highly accurate cruise missiles from Russia that have been installed
on Chinese submarines and could be used against U.S. Navy vessels.

But Helvey said the ability to strike ships will depend on China's
intelligence and surveillance abilities.

"This is still a new capability for China; we are going to be
watching how they integrate that anti-ship capability into their
submarine force," he said.

In response to the Pentagon report, Rep. Ike Skelton (D-Mo.),
chairman of the House Armed Services Committee, said he was concerned
about China's continuing modernization and rapid growth.

But he said there were signs that China was taking some steps toward
increasing transparency, including an agreement to submit a report to
the United Nations on its military spending and an agreement to
create a defense hotline between Washington and Beijing.

julian.barnes at latimes.com

Times staff writer Ching-Ching Ni in Beijing contributed to this report.