Category Archives: China aggression

Cheat Sheet on the Defense Authorization Bill

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Guantanamo Bay:

Since Congress specifically provided the president with the authority to acquire the U.S. Naval Station at Guantanamo Bay, Chairman Royce’s legislation asserts Congress should have to approve any decision to give it away, which certainly shouldn’t happen with this communist and hostile Cuban government.

As Chairman Royce has said, “the U.S. Naval Station at Guantanamo Bay is critical to our national security and humanitarian operations that have saved countless lives.  We must protect against executive overreach during this administration, and the next, and the next.”

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DefenseNews/WASHINGTON — Responding to fears the US military’s technological superiority is at risk, the Senate Armed Services Committee advanced an annual defense policy bill that would open competition to commercial industry, seen as a spur to innovation and cost-efficiency.

The marquee change, if the SASC’s version of the 2017 National Defense Authorization Act passes Congress and is signed by the president, is the proposed closure of the Pentagon’s chief weapons buyer’s office and reassignment of its duties to two new defense undersecretaries for innovation and acquisitions management. It also contains far-reaching language to curb a major concern of SASC Chairman John McCain: cost-plus contracts.

In February, McCain made headlines when he vowed not to authorize the Air Force’s Long Range Strike-Bomber so long as it was procured using a cost-plus contract. The SASC bill does not check that box, but it promises a broader impact, to discourage cost-plus contracts, where a contractor is paid for all of its allowed expenses to a set limit, plus additional payment to allow for a profit.

In a background briefing on Monday, a senior committee aide — who likened DoD’s dependence on cost-plus to a drug addiction — said the venerable contracting vehicle has its uses, but too often fuels cost overruns and is out of step with the way commercial firms in Silicon Valley and elsewhere do business. Fixed-price contracts, on the other hand, give firms an incentive to work as efficiently as possible to maximize their profits.

“All of this reform is because the Cold War has ended, and post-Cold War, American technological military dominance is over, and not only can our adversaries see that they can replicate what we can do with the traditional defense marketplace, they are seeing there is a lot of technology in the commercial marketplace,” said the aide. “If they can access that quicker than we can access that and derive defense products from that new base, they can potentially leap ahead of us.”

The bill, which the SASC voted to advance to the full Senate last week, contained 130 acquisition reform provisions — a continuation of the committee’s work last year. Some language aimed at curbing bid protests would mean any large firms that lose a protest they file would have to pay a penalty, while other provisions would curb barriers to entry for so-called non-traditional firms.

Complex, DoD-unique cost-accounting standards geared toward the minutiae of cost-plus contracts have not only created a barrier for commercial firms but an auditing backlog within DoD that is preventing 30- and 40-year-old contracts from being closed, the Senate aide said.

To address this, the bill would set up a new accounting standards board aimed at pro-competition changes.

“We’re looking to move more and more companies away from that [accounting standard], and make sure the way accounting looks in the department is more and more commercial-like, so companies aren’t creating new accounting systems just to deal with the Department of Defense,” the aide said.

For a company like SpaceX, which is developing its own rocket engine, assessing a reasonable price is a tricky proposition, the Senate aide said. For DoD, which uses cost-plus contracting, it’s the agreed-upon cost of production plus a reasonable profit, while for a commercial firm, it’s about what the market will bear.

“In the fixed-price world, your profit margin is about how well you execute,” the aide said. “A government contractor is more like a utility, and the argument is who’s more innovative, someone with a high margin or a public utility?”

A four-year pilot program established by the bill would exact fees to fund advanced prototypes purchased through fixed-price contracts. The penalties would amount to, for a cost-plus technology development contract, an additional 1 percent of DoD’s year-to-year obligation, and on a procurement contract, 2 percent. This requirement would begin in 2018.

Among other measures, the bill would establish a phased-in, internal approval process for cost-plus contracts, which by 2020 would apply to any cost-plus contract over $5 million.

Ultimately, the Defense Department will not be kept from using cost-plus contracts where needed, particularly for defense-unique platforms like, say, a nuclear submarine. However, the aide stopped short of saying the proposed bill, if enacted, would have precluded the current acquisition strategy for the bomber. Instead, the bill reinforces the signal that arrangements of this type will face new scrutiny.

“We would hope the department would look at that in a different manner,” the aide said. “Ultimately it will be discretionary. We don’t want to impinge on the [defense] secretary.”

Bid Protests

Acknowledging the value of the bid protest process as a policing function for defense acquisitions, the aide said it also creates a risk-averse culture among acquisitions officials that is stymying innovation. Hence the proposed “loser pays” provision.

That language would apply to a protest-losing company with more than $100 million in annual revenue, or an incumbent firm that protests the loss of a contract, keeps the business via a bridge contract and then loses. The penalty would equal the Government Accountability Office’s cost to process the protest.

What’s driving the language, the Senate aide said, is that Wall Street analysts have begun to tout protests as being part of the fiduciary responsibility of a losing firm. Members of the committee fear that this thinking, unchecked, will fuel a boom in protests.

Another concern was that the risk aversion among contracting officers was leading to contract awards for lowest-price, technically acceptable, offerings over offerings that were neither the most innovative or the best value for the government.

 

Table 1. FY2017 National Defense Authorization Act (H.R. 4909)

amounts in millions of dollars of discretionary budget authority

Bill Title Budget Request HASC reported bill (H.R. 4909) Senate committee- reported bill Conference Report
National Defense Base Budget
Procurement 101,971.6 103,062.3
Research and Development 71,391.8 71,629.8
Operation and Maintenance 171,318.5 169,325.3
Military Personnel 135,269.2 134,849.8
Defense Health Program and Other Authorizations 36,557.0 37,025.6
Military Construction/Family Housing 7,444.1 7,694.0
Subtotal: DOD Base Budget 523,952.1 523,586.9
Atomic Energy Defense Activities 19,240.5 19,512.1
Other Defense-Related Agencies 211.0 300.0
TOTAL: National Defense Budget Function (050) Base Budget 543,403.6 543,399.0
DOD OCO Budget 58,798.0 58,793.5
GRAND TOTAL: FY2017 NDAA 602,201.6 602,192.5

Beware: Lil Blue Men Militia, S. China Sea

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The only estimate of the size of the Maritime Militia obtained during the course of this research was from a source published in 1978, which put the number of personnel at 750,000 on approximately 140,000 craft.5 In its 2010 Defense White Paper, China stated that it had 8 million primary militia members nationwide.6 The Maritime Militia is a smaller unique subset since it performs many of its missions at sea. Since an accurate number is not available this chapter takes more of a grassroots approach and attempts to determine the average size of a unit at the local level. It is important to note that the Maritime Militia is distinct from both China’s coastal militia (shore based) and its naval reserve, although some coastal militia units have been transformed into Maritime Militia units. Full white paper is here.

While Russia has employed “Little Green Men” surreptitiously in Crimea, China uses its own “Little Blue Men” to support Near Seas claims. As the U.S. military operates near Beijing’s artificially-built South China Sea (SCS) features and seeks to prevent Beijing from ejecting foreign claimants from places like Second Thomas Shoal, it may well face surveillance and harassment from China’s maritime militia. Washington and its allies and partners must therefore understand how these irregular forces are commanded and controlled, before they are surprised and stymied by them.

China has long organized its civilian mariners into maritime militia, largely out of necessity. Recent years have seen a surge of emphasis on maritime militia building and increasing this unique force’s capabilities; however it is difficult to ascertain who or what entity within China’s government has ordered such emphasis. One can point to Xi Jinping’s visit to the Tanmen Maritime Militia in 2013, after which maritime militia building oriented toward the SCS has seen growth in places like Hainan, Guangdong, and Guangxi. Yet local militia training and organization plans prior to this date had already emphasized the training of maritime militia units.

Unit Composition and Organization

China’s militia has two major subcomponents: an “ordinary” reserve of registered male citizens akin to the U.S. Selective Service pool, and a “primary” force more readily mobilized to respond to various contingencies. The primary force receives dedicated resources, troops demobilized from active duty, and training. Within the primary force, maritime militia units—formed solely at the tactical level of organization—are smaller and more specialized on average than their land-based counterparts. Within the maritime militia, a small but growing elite set of units are the ones most likely to be deployed on more sophisticated operations that involve monitoring, displaying presence in front of, or opposing foreign actors. They do so in part by supporting China’s navy and coast guard in such efforts. Some cities with large mobilization potential—i.e., a large maritime industry or fishing community—will form battalion-sized units. Most localities create company-sized units, however. These companies are divided into platoons and squads, with the smallest grouping based on each individual vessel.

Chain of Command

Militia management begins broadly at the General Staff Department’s Mobilization Department, which oversees and formulates regulations for nationwide militia work. Uniquely a local military force, the maritime militia falls within the hierarchical People’s Liberation Army (PLA) army local force command structure that runs through all levels of local military organs. As stipulated in China’s “Militia Work Regulations,” real command of the militia begins at the Provincial Military District (MD) level and below. The thousands of county- and grassroots-level People’s Armed Forces Departments (PAFD) established in county-level cities, townships, villages, and maritime enterprises (fishing companies, shipyards, etc.) directly execute the organizing and training of maritime militia. Grassroots-level PAFDs report to county-level PAFDs, which report to Military Sub-district (MSD) Headquarters, themselves reporting to MD Headquarters. Maritime militia building also receives attention by Military Region-level Command, albeit in a supervisory fashion. Higher levels of military commands likely view the maritime militia as a subset of military organization within the broader ecosystem of local militia, with particular focus on broader mobilization efforts. Additionally, militia battalions and companies form party branches to ensure Party control at the grassroots levels.

It must be emphasized that maritime militia command authority resides within multiple entities, including both the local military organs (MD, MSD, PAFD) and their government/party counterparts. This is referred to as “双重领导” in Chinese, connoting the “dual-leadership” system by the local military and government’s principal leaders. It is thus common to see a city party secretary acting in his role as first-party secretary of the local military party committee overseeing the PAFD’s efforts at managing the maritime militia. An easily visible example: Sansha City’s mayor/party secretary Xiao Jie and his military counterpart Commander Cai Xihong both attended the founding ceremony of Sansha City’s Maritime Militia Company. “Dual-leadership” is further reinforced by the fact that local governments fund militia construction.

Since both military and government leaders are involved in local armed forces building, the National Defense Mobilization Committee System (NDMC) established at each corresponding level plays the critical role in binding them into one decision-making body. The NDMC brings together these leaders to organize, direct, and coordinate nationwide national defense mobilization, ensuring that national resources can be rapidly mobilized for defense or emergency needs. Local NDMCs can also establish civilian-military joint command structures facilitated by national defense mobilization communications networks. As a militia force, the maritime militia would need a specified duration to mobilize and gather in the area designated by their superiors. Localized mobilization orders transmitted to the maritime militia could originate from a variety of sources. Regardless, they would be sent down the chain and delivered to the maritime militia via the PAFDs managing them.

While county-level PAFDs are manned by active duty PLA officers, grassroots-level PAFDs are manned by civilian government cadres. Training and education efforts target a “select group of militia cadres” (专职人民武装干部), units’ leaders (company, platoon, and squad) and “information personnel” (信息员). This group of personnel forms the backbone of the maritime militia and helps implement party control, command and control, and maintain unit cohesiveness. Essential to successful command and control of the maritime militia are the “boat captains”—often termed “船老大”—and the information personnel, which provide dedicated personnel for onboard leadership, identification, and communications. This is further facilitated by increasing incorporation of satellite communications technologies into the fishing fleet and thereby into the maritime militia.

Mission-based Command Authority

Although maritime militia are built out of the regular command structure of coastal military organs, they also serve naval and maritime law enforcement forces (MLE). The command relationships for the maritime militia may vary with the mission they are employed in. For example, maritime militia reconnaissance detachments report their findings directly to MD Headquarters, while another detachment summoned to assist with maritime law enforcement would be commanded by the Chinese Coast Guard (CCG) “in cooperation with their MD.” Similarly, support detachments serving roles for China’s navy would be under the command of the PLA Navy in cooperation with the detachment’s MD. It is clear that the maritime militia are controlled by their land-based local military organs, an arrangement flexible enough to serve a variety of supporting roles for the Chinese Navy and MLE forces. Many Chinese sources use a phrase that succinctly states such arrangements: “the military organ expresses its requirements, the NDMC coordinates, and the government implements” (军事机关提需求、国动委搞协调、政府抓落实), referring to the cooperation that occurs between civilian and military leaders in building the maritime militia.

More than One Way to Tie the Knot

Organization and command of maritime militia likely varies by locality. This stems largely from a given locality’s maritime industry and its influence on militia composition, requiring local leaders to plan maritime militia missions from what is available. Making command and decision making arrangements based on local conditions is critical to the proper functioning of such a force. Many ad hoc leading small groups are formed to handle a certain issue area, or provide temporary guidance for certain missions. The multiple organizations supporting maritime militia building (e.g., the CCG, Fisheries Bureau, and Maritime Safety Administration) are likely to enter these command structures in some fashion.

The 300,000-troop reduction that Xi announced at Beijing’s 3 September military parade will likely send additional personnel to the maritime militia, and could even further shape their command and control. Specifically, efforts to streamline the current long reporting chain through land-based forces might ensue. All the more reason that it’s vitally urgent to understand how China’s “Little Blue Men” get their sailing orders, and what those orders might be.

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China Has Militarized the S. China Sea

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China Is ‘clearly militarizing’ The South China Sea

The U.S. confirmed that China recently deployed fighter jets to Woody Island.

China is “clearly militarizing the South China (Sea),” said Admiral Harry Harris, head of the U.S. Pacific Command, adding: “You’d have to believe in a flat Earth to think otherwise.”

Harris said he believed China’s deployment of surface-to-air missiles on Woody Island in the South China Sea’s Paracel chain, new radars on Cuarteron Reef in the Spratlys and its building of airstrips were “actions that are changing in my opinion the operational landscape in the South China Sea.”

Soon after he spoke, U.S. government sources confirmed that China recently deployed fighter jets to Woody Island. It was not the first time Beijing sent jets there but it raised new questions about its intentions.

“The question is whether they might stay this time,” said Gregory Poling, director of the Asia Maritime Transparency Initiative at the Center for Strategic and International Studies.

But U.S. and Chinese foreign ministers signaled that despite disagreements over the South China Sea, they were near agreement on a U.N. resolution against North Korea for its recent nuclear and missile tests and stressed their cooperation on economic and other issues. More from Huffington Post here.

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China dismisses US report of its so-called military threat in South China Sea

FNC: BEIJING –  China’s defense ministry criticized a U.S. report assessing its island-building efforts in the South China Sea, saying it “hyped up” China’s so-called military threat.

The U.S. Defense Department’s annual report on China’s military activities had “wilfully distorted China’s national defense policy,” said ministry spokesman Yang Yujun, adding that the U.S. was too suspicious.

China expressed its “strong dissatisfaction and firm opposition” to the Pentagon report, Yang said.

“China follows a national defense policy that is defensive in nature,” he said. “China’s deepening military reforms and its strengthening of weapons and equipment building are aimed at maintaining sovereignty, security and territorial integrity and guaranteeing China’s peaceful development.”

The report to the U.S. Congress on Friday said that China was focused on developing and weaponizing the islands it has built in the disputed waters of the South China Sea so it will have greater control over the maritime region without resorting to armed conflict.

It accused China of “increasingly assertive efforts to advance its national sovereignty and territorial claims” and a lack of transparency about its growing military capabilities that are causing tensions with other countries in the region.

Yang said it was the United States that had been “frequently sending military aircraft and warships to the South China Sea to make a show of force.”

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In part from FreeBeacon: The construction indicates China “is attempting to bolster its de facto control by improving military and civilian infrastructure in the South China Seas.”

The airfields, harbors, and resupply facilities will allow China to “detect and challenge” rival claimants to the island and increase the military capabilities available to China and short their deployment times.

The report shows before-and-after pictures of seven disputed Spratly islands, including Fiery Cross Reef where a major buildup took place on 663 new acres of the island.

fierycrossreef

China’s missile buildup is one of the most prominent features of the PLA arsenal with new missiles and the addition of multiple warheads on both new and older systems.

The report also revealed that China is planning a new long-range stealth bomber that would give Beijing a nuclear triad along with ground- and sea-based strategic missiles.

China “is developing and testing several new classes and variants of offensive missiles, including a hypersonic glide vehicle; forming additional missile units; upgrading older missile systems; and developing methods to counter ballistic missile defenses,” the report said.

Several new attack and ballistic missile submarines also have been built and are continuing to be deployed.

China is also building up its space warfare capabilities, and last year, it advanced work on an anti-satellite missile tested in July 2014.

A section of the report on China’s energy strategy reveals that China will remain heavily dependent on foreign oil. Sixty percent of its oil was imported in 2015, and by 2035, Beijing will be importing 80 percent of its oil.

Energy supplies are vulnerable to disruption as some 83 percent of China’s oil currently passes through the South China Sea and Strait of Malacca.

Land pipelines are being built from Russia and Kazakhstan as part of efforts to maintain a supply chain that is less susceptible to disruption.

The report described China’s development of long-range precision attack capabilities as “extraordinarily rapid.”

Ten years ago China’s military had a limited capability to strike targets beyond the 100-mile-wide Taiwan Strait. “Today, however, China is fielding an array of conventionally armed short-range ballistic missiles (SRBMs), as well as ground- and air-launched land-attack cruise missiles (LACMs), special operations forces (SOF), and cyber warfare capabilities to hold targets at risk throughout the region,” the report said.

precisionstrike

“U.S. bases in Japan are in range of a growing number of Chinese [medium-range ballistic missiles] as well as a variety of [land-attack cruise missiles],” the report said, adding that Guam could be targeted by long-range cruise missiles on H-6K bombers that conducted the first flights into the Pacific last year.

The DF-26 missile also was unveiled at a military parade and can conduct precision attacks on Guam, a major U.S. military hub and a key base for the Pentagon’s pivot to Asia.

Land-attack cruise missiles also are far more accurate and can strike enemy airbases, logistic centers, communications, and other ground-based infrastructure.

In a future conflict, the PLA plans to attack supply centers and power projection capabilities that are used in coordinating transportation, communications, and logistics.

China’s military spending was estimated in the report to be greater than $180 billion but could be larger because of Chinese secrecy. The report estimates the budget will grow to $260 billion by 2020.

The report contains a section explaining that the PLA remains a politicized “Party army” rather than a traditional national armed force.

Chinese state media rejects the notion of an apolitical national army because Chinese leaders regard the Soviet Communist Party lack of control over the military as a key factor in the 1991 collapse of the Soviet Union.

One new reform was creating a Political Work Department within the PLA to maintain party control. “The PLA’s political work system is the primary means through which the CCP ‘controls the gun’ in accordance with Mao Zedong’s famous dictum that ‘political power grows out of the barrel of a gun,’” the report says.

Control mechanisms include political commissars, a Party committee system, and Party investigative units.

The Pentagon’s policy, according to the report, seeks to “deepen practical cooperation” while managing differences, a policy that critics say has led to misunderstanding China’s growing official animosity toward the United States.

The solution offered in the report for dealing with the increasing Chinese military threat is to “monitor and adapt” to the buildup and encourage Beijing to end the secrecy of its strategy and arms buildup.

The report made no mention of China’s growing anti-American stance as reflected in both state-run media and official military writings.

In 2013, China’s Communist Party-affiliated newspaper Global Times published a detailed report on future nuclear attacks on the western United States showing how the strikes would kill 12 million Americans through blast and radiation.

The Obama administration and Pentagon made no condemnation of the unprecedented nuclear threat. Read more here.

ODNI Clapper: We Can’t Leave Town

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We can’t fix this. A couple of additional points to add:

  1. Iran was pretty much controlled until the Obama regime decided to formal a rogue country to be accepted around the globe and terminate sanctions giving Iran more money to behave with wild abandon. Now John Kerry is working personally to help the entire economy of Iran.
  2. We have arrived at a malfunction junction where the intersection between intelligence and politics crash and politics wins over the defeat of global jihad.

And then there is Russia.

‘The U.S. can’t fix it’: James Clapper on America’s role in the Middle East

WaPo: Early in his tenure as director of national intelligence, James Clapper could sometimes be heard complaining, “I’m too old for this [expletive]!” He has now served almost six years as America’s top intelligence official, and when I asked him this week how much longer he would be in harness, he consulted his calendar and answered with relief, “Two hundred sixty-five days!”

Clapper, 75, has worked in intelligence for 53 years, starting when he joined the Air Force in 1963. He’s a crusty, sometimes cranky veteran of the ingrown spy world, and he has a perspective that’s probably unmatched in Washington. He offered some surprisingly candid comments — starting with a frank endorsement of President Obama’s view that the United States can’t unilaterally fix the Middle East.

Given Clapper’s view that intelligence services must cooperate against terrorism, a small breakthrough seems to have taken place in mid-April when Clapper met with some European intelligence chiefs near Ramstein Air Base in Germany to discuss better sharing of intelligence. The meeting was requested by the White House, but it hasn’t been publicized.

“We are on the same page, and we should do everything we can to improve intelligence coordination and information sharing, within the limits of our legal framework,” said Peter Wittig, German ambassador to Washington, confirming the meeting.

The terrorist threat has shadowed Clapper’s tenure. He admitted in a September 2014 interview that the United States had “underestimated” the Islamic State. He isn’t making that mistake now. He says the United States is slowly “degrading” the extremists but probably won’t capture the Islamic State’s key Iraqi stronghold this year and faces a long-term struggle that will last “decades.”

“They’ve lost a lot of territory,” he told me Monday. “We’re killing a lot of their fighters. We will retake Mosul, but it will take a long time and be very messy. I don’t see that happening in this administration.”

Even after the extremists are defeated in Iraq and Syria, the problem will persist. “We’ll be in a perpetual state of suppression for a long time,” he warned.

“I don’t have an answer,” Clapper said frankly. “The U.S. can’t fix it. The fundamental issues they have — the large population bulge of disaffected young males, ungoverned spaces, economic challenges and the availability of weapons — won’t go away for a long time.” He said at another point: “Somehow the expectation is that we can find the silver needle, and we’ll create ‘the city on a hill.’” That’s not realistic, he cautioned, because the problem is so complex.

I asked Clapper whether he shared Obama’s view, as expressed in Jeffrey Goldberg’s article in the Atlantic, that America doesn’t need the Middle East economically as it once did, that it can’t solve the region’s problems and that, in trying, the United States would harm its interests elsewhere. “I’m there,” said Clapper, endorsing Obama’s basic pessimism. But he explained: “I don’t think the U.S. can just leave town. Things happen around the world when U.S. leadership is absent. We have to be present — to facilitate, broker and sometimes provide the force.”

Clapper said the United States still can’t be certain how much harm was done to intelligence collection by the revelations of disaffected National Security Agency contractor Edward Snowden. “We’ve been very conservative in the damage assessment. Overall, there’s a lot,” Clapper said, noting that the Snowden disclosures made terrorist groups “very security-conscious” and speeded the move to unbreakable encryption of data. And he said the Snowden revelations may not have ended: “The assumption is that there are a lot more documents out there in escrow [to be revealed] at a time of his choosing.”

Clapper had just returned from a trip to Asia, where he said he’s had “tense exchanges” with Chinese officials about their militarization of the South China Sea. He predicted that China would declare an “air defense identification zone” soon in that area, and said “they’re already moving in that direction.”

 

Asked what he had achieved in his nearly six years as director of national intelligence, Clapper cited his basic mission of coordinating the 17 agencies that work under him. “The reason this position was created was to provide integration in the intelligence community. We’re better than we were.”

After a career in the spy world, Clapper argues that intelligence issues are basically simple; it’s the politics surrounding them that are complicated. “I can’t wait to get back to simplicity,” he said, his eye on that calendar.

**** Sampling of how bad things are:

  1. Al Qaeda issued a call for Muslims to mobilize to fight in al Sham. Al Qaeda leader Ayman al Zawahiri urged Muslims to fight in Syria and for the factions in Syria to unify. Zawahiri described the Syrian uprising as the only one from the Arab Spring to have continued along the right path. He sought for Muslims to defend the gains made in Syria against other actors like Russia, Iran, and the West, and stated the objective of a governing entity establishing itself in the territory. Hamza bin Laden, Osama bin Laden’s son, echoed the call for mobilization. He also called on Muslims to unify in Iraq and Syria and for those who cannot travel to conduct lone-wolf attacks.
  2.  A pro-Islamic State of Iraq and al Sham (ISIS) cell attempted to weaponize anthrax and plan a mass-casualty attack similar to the 2013 Westgate Mall attack, according to Kenyan and Ugandan authorities. The cell’s ringleader may have communicated with ISIS militants in Libya and Syria, indicating an expansion of ISIS’s influence in East Africa.  Governments seeking counterterrorism funding may also exaggerate ISIS’s presence, however.
  3. ISIS resumed a territorial growth strategy in Libya after planned offensives on its stronghold in Sirte stalled. ISIS militants seized strategically located towns from Misratan militias to the west of Sirte as part of efforts to expand its contiguous zone of control in central Libya. ISIS is also bolstered by the support of tribal leaders and elders, representing factions of a large tribal federation that has suffered since the fall of Qaddafi. These tribal leaders are aligning with ISIS against opponents in both the Libyan National Army bloc in the east and the Misratan bloc in the west in order to protect their political and economic interests. [See CTP’s backgrounder on forces in Libya and a forecast of ISIS’s courses of actions in Libya.] (From: The American Enterprise Institute’s Critical Threats Project )  Add in Russia’s building war on NATO….

China, Unfettered Espionage Against U.S.

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Did China Just Steal $360 Billion From America?

Gordon G. Chang/Forbes:

“The FBI has obtained information regarding multiple malicious cyber actor groups that have compromised sensitive business information from U.S. commercial and government networks through cyber espionage,” warned the law enforcement agency on the 2nd of this month. At about the same time, the Department of Homeland Security and the Defense Security Service of the Department of Defense issued similar alerts.

The principal group in question is believed to be the one codenamed APT6. The three letters stand for Advanced Persistent Threat, and this group appears to be among the first tagged as an “APT.”

Kurt Baumgartner of Russian firm Kaspersky Lab suggests APT6 is state-sponsored.That sounds correct because as Craig Williams WMB -4.47% at Talos, a part of Cisco, notes, it is “an advanced, well-funded actor.”

Baumgartner declined to identify APT6’s nationality, but others have. Vice Media’s Motherboard reports that experts think the group is Chinese. As the FireEye security firm notes, APT6 is “likely a nation-state sponsored group based in China.”

In any event, APT6 has caught the attention of the FBI. The group also appears to be the subject of the Bureau’s February 12 alert.

Related reading from the FBI

The February 12 alert says the group in question was attacking U.S. networks “since at least 2011,” but Baumgartner thinks it was active as early as 2008.

In September of last year during Xi Jinping’s state visit, President Obama said the U.S. and China had reached “a common understanding on the way forward” on cybertheft. Washington and Beijing, he said, had affirmed the principle that neither government would use cyber means for commercial purposes.

China indeed affirmed that principle, and the agreement was, as Adam Segal and Tang Lan write, “a significant symbolic step forward.” The pair correctly note that “trust will be built and sustained through implementation.”

As might be expected, there was little implementation on the Chinese side at first. CrowdStrike , the cyber security firm, for instance, in October reported no letup in China’s cyber intrusions into the networks of American corporates.

Related: Economic Terrorism

Beijing, according to the Financial Times, has since reduced its cyber spying against American companies. As Justin Harvey of Fidelis Cybersecurity told the paper, “What we are seeing can only be characterized as a material downtick in what can be considered cyber espionage.”

And FireEye noted that all 22 Chinese hacking units identified by the firm as attacking American networks discontinued operations.

Nonetheless, the Obama administration is not declaring victory quite yet, and for good reason. “The days of widespread Chinese smash-and-grab activity, get in, get out, don’t care if you’re caught, seem to be over,”says Rob Knake, who once directed cyber security policy at the National Security Council and is now at the Council on Foreign Relations. “There’s a consensus that activity is still ongoing, but narrower in scope and with better tradecraft.”

Whether espionage is overt or not, the damage to American business is still large. According to the May 2013 report of the Blair-Huntsman Commission on the Theft of American Intellectual Property, “The scale of international theft of American intellectual property is unprecedented—hundreds of billions of dollars per year, on the order of the size of U.S. exports to Asia.”

William Evanina, America’s chief counterintelligence official, told reporters in November that hacking espionage costs U.S. companies $400 billion each year and that China is responsible for about 90% of the attacks. Beijing’s haul, therefore, looks like something on the order of $360 billion.

And how do we know the Chinese are culprits? For one thing, bold Chinese cyber thieves like to show their victims the information they have stolen.

Moreover, the U.S. government has gotten better at attribution, going from being able to attribute one-third of the attacks to more than two-thirds. The improvement is largely due to the government’s partnership with the private sector. Microsoft, Google, and Twitter, for example, will share information if they detect attacks on their customers.

And their customers are still getting attacked. “We continue to see them engage in activity directed against U.S. companies,” said Admiral Mike Rogers, the head of U.S. Cyber Command, in early April in testimony before the Senate Armed Services Committee. “The questions I think that we still need to ask is, is that activity then, in turn, shared with the Chinese private industry?”

It’s right for Rogers to be cautious, but it would be strange for Chinese hackers not to share as they have done in the past. At the moment, there is little reason for Beijing to stop hacking, because Washington is not willing to impose costs on China for its “21st century burglary.”

There was the May 2014 indictment of five officers of the People’s Liberation Army for cyberattacking American businesses, like Alcoa and U.S. Steel, and the United Steelworkers union. That move, while welcome, was overdue and only symbolic. The Blair-Huntsman Commission suggested an across-the-board tariff on Chinese goods, but the imposition of a penalty of that sort is unlikely without a radical change of thinking in Washington.

Therefore, the FBI, even after all these years, is just playing catch up. The February alert is a tacit admission that the U.S. government is not in control of its own networks said Michael Adams, who served in U.S. Special Operations Command. “It’s just flabbergasting,” Adams told Motherboard. “How many times can this keep happening before we finally realize we’re screwed?”

The People’s Republic of China is still committing monumental thefts in large part because successive American governments cannot get beyond half-measures.

Beijing may be an intruder, but Washington somehow finds it unseemly to lock the door and punish the thief.