Inside the Ring

NEWS AND ANALYSIS:

CHINA’S ’CRAFTY REVENGE’

The Obama administration is braced for a tough Chinese reaction to the latest U.S. arms sale to Taiwan and is worried it will come during the visit to Beijing by White House National Security Adviser Thomas E. Donilon.

However, the U.S. intelligence community so far is unable to assess authoritatively just what China will do in response to the $5.8 billion arms package to upgrade Taiwanese fighters announced last month.

So far, China postponed the visit to China by Adm. Robert Willard, commander of U.S. forces in the Pacific, and blocked a China visit by the U.S. Army Band that was to reciprocate for China’s military band touring the United States earlier this year.

“They also are slow-rolling most non-proliferation-related visits and meetings, obviously a subject they view as a favor to us since they don’t care about it,” one U.S. official said.

However, recent comments by Chinese Gen. Luo Yuan, Beijing’s high-profile military hawk, has provided what defense officials say are hints of ominous things to come.

Gen. Luo - senior political commissar for the General Logistics Department of the People’s Liberation Army who in the past has called for invading Taiwan - recently was quoted in a Chinese-controlled news report as saying China should respond to the latest arms sale with “crafty revenge” or “indirect revenge.”

Intelligence analysts were left trying to discern Gen. Luo’s meaning and whether the comments signal that China’s military plans a high-profile response.

China regards Taiwan as an unfinished part of the Communist Party’s consolidation of power in 1949 and has threatened in the past to go to war if the island declares formal independence. Gen. Luo and others have warned that the Chinese government’s failure to take “offensive” responses to successive arms sales packages is leading to Beijing losing Taiwan.

Gen. Luo was quoted in the press report Sept. 23 as saying the U.S. upgrading of Taiwan’s F-16s was a “trick” to deceive the Chinese people. He also warned that the arms sale may prompt unspecified new steps to bolster military power designed to curb Taiwan secession. China currently has more than 1,000 missiles aimed at Taiwan from positions along the coast.

The Chinese general urged China to follow Russia’s lead. In 2008, Moscow deployed SS-27 ICBMs near its western border with Europe and threatened to move advanced short-range missiles to the Baltic enclave of Kaliningrad, successfully dissuading the Obama administration from deploying ground-based anti-missile interceptors in Poland.

Last year, Gen. Luo called for punishing the United States by selling off China-held Treasury debt holdings.

The Obama administration was embarrassed twice in recent months by the Chinese during high-level visits. In January, China’s military without warning conducted the first flight test of a new J-20 stealth jet during the visit to Beijing by then-Defense Secretary Robert M. Gates.

Then in July, Chinese Gen. Chen Bingde, chief of the general staff, embarrassed Adm. Mike Mullen, chairman of the Joint Chiefs of Staff at the time, by making sarcastic comments during a news conference in Beijing when he told American taxpayers they are spending too much on defense.

China in the past used missile tests to send political signals to its main superpower rival, so U.S. intelligence agencies are on alert for any unexpected military activities during Mr. Donilon’s visit to China, which begins this weekend.

The White House issued a vague statement on Mr. Donilon’s trip. He will first travel to Beijing for meetings with Chinese Vice Premier Wang Qishan and State Councilor Dai Bingguo. The statement said he will discuss “a wide range of bilateral, regional and global issues of mutual concern.”

The military is ready for any provocation. According to Stratfor, the private intelligence firm, the U.S. Navy carrier strike group led by the USS George Washington is on patrol near the South China Sea, and the big-deck amphibious assault ship USS Essex, with Marines on board, is in the Philippines Sea.

NORTH KOREA SPLIT

U.S. officials said the announced departure of State Department special envoy for North Korea, Stephen Bosworth, highlights a policy split within the Obama administration about how to deal with North Korea.

The State Department on Wednesday said a U.S. team will meet with North Korean officials in Geneva next week to discuss North Korea’s nuclear program. Mr. Bosworth’s replacement is Glyn Davies, currently U.S. ambassador to the International Atomic Energy Agency in Vienna.

One official said Mr. Bosworth was upset that the administration has been unable to formulate a coherent plan for dealing with the rogue communist state.

A second official said the administration also has no clear policy for curbing North Korean arms proliferation. Instead of trying to pressure the regime, the administration is planning to make shipments of food aid to the impoverished state, despite Pyongyang’s past use of such aid to feed its military and ruling elites.

Senate Republican Whip Jon Kyl of Arizona said the administration has promised no further concessions to Pyongyang.

“The administration has assured me that it has made clear to North Korea that it must undertake concrete steps toward denuclearization,” Mr. Kyl said. “The days of paying North Korea in exchange for promises that it does not intend to keep are over.”

IRANIAN CYBERSPYING

China is not alone as a major source of cyber-espionage.

Extensive Iranian cyber-intelligence collection activities were made public for the first time in a recently disclosed State Department cable that highlights large-scale Iranian cyberspying aimed at gathering military and technology data through the Internet.

The March 31, 2009, cable, labeled “secret” and revealed by WikiLeaks, the anti-secrecy website, identified several Iranian institutions that engage in clandestine collection against the U.S. government.

“Most of the Iranian universities involved in this activity maintain longstanding ties” to the Islamic Revolutionary Guard Corps, which recently was linked to an assassination plot in the United States, the cable said.

The data obtained by the Iranians can be used to conduct further cyber-attacks, and, the cable noted, “persistent attempts to collect U.S. information could jeopardize the security of U.S. operations and personnel.”

From 2007 to 2009, addresses connected to Iran’s Farhang Azma Communication Co. directly browsed a number of U.S. Navy unit websites and systematically downloaded more than 100 Navy unit webpages using software “Web Downloader/8.1,” the cable said.

Also, students and researchers at a number of prominent Iranian universities and companies have targeted U.S. information for several years.

Methods used include attempts by people from Iranian universities and commercial organizations to solicit data from U.S. contractors engaged in classified work through “socially engineered email messages” that targeted restricted U.S. operations and research.

“This information could then be used to develop similar programs for the [government of Iran], shared with third-party entities (e.g., Islamic extremist groups), or exploited through additional Iranian computer network operations activities,” the cable states.

The Iranians also searched for digital information on U.S. facilities in Iraq and Afghanistan, as well as vehicles, vessels and people.

Two universities that are part of the Iranian cyberspying operation were identified as Amirkabir University of Technology and Malek Ashtar University of Technology in Tehran. The institutions spied on “a number of highly sophisticated technology projects, particularly those related to unmanned aerial vehicles (UAVs) and autonomous underwater vehicles,” the cable says.

The information was used by the institutions for Iran’s defense research on unmanned aircraft.

The Isfahan University of Technology also used cyber-attacks to gain U.S. technology, including U.S. equipment produced in China and Russia.

The cable warned that in addition to losing military and commercial technology to Iran, the cyberspying could be supplied by the Iranians to “state-sponsored and independent actors [who] may seek to gather information in order to hinder the success of constructive discourse or attempt to exploit individuals involved.”