Cyber-hacking lessons from 2013 still apply in 2014

Posted by mmcmullan on 05/19/2014

This morning, the U.S. Justice Department accused five members of the Chinese military of targeting and stealing from U.S. business interests via computer hacking. Justice’s move – leveling criminal cyber-crime charges against a foreign country – is unprecedented.

But the alleged actions of the five Chinese military men are not. They’re members of Unit 61398, a hacking group within the People’s Liberation Army that was introduced last year to the wider world via a report by private web security firm Mandiant. A year later, it looks like Justice and the Obama administration are taking this stuff seriously.

The Chinese government has already denied – nay, denounced – the charges leveled against it, which is to be expected. And, only a few hours past this development, it’s hard to say what the diplomatic ramifications will be. But now is a pertinent time to revisit what Alliance for American Manufacturing (AAM) President Scott Paul wrote last year:

More than a dozen years ago, Congress lowered our trade barriers with Beijing. In doing so, we allowed China to take a massive chunk of our manufacturing base. In exchange, we received slightly lower retail prices in big box stores and promises of democratic political reforms in Chinese society.

But instead of reform, China took its new, huge flow of capital and perfected the world’s largest and most technically proficient police state. And as the Mandiant report confirms, it is increasingly looking outside its borders.

And now here we are. The kind of espionage that the Chinese government systematically engages in howls for a response. But the response should be more than a simple protestation, which so far has amounted to acquiescence. To stop China from hacking, it should be one that Beijing will understand: one that puts a dent in its bank account.

When China cheats — or, in this case, does something that is blatantly illegal, like systematically compromising thousands of American computer networks — our trading policies should shift accordingly.

Emphasis added by yours truly. We’ll be keeping an eye on this story as it develops.

Read Scott Paul’s 2013 opinion on China's hacking in its entirety.

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