China Hits Back Over Hacking Charges

U.S. accused of relying on “deliberately fabricated facts.”

Chinese people wave flags of the Communist Party of China as they take part in the celebrations to mark the 90th anniversary of the ruling party's founding, in southwest China's Chongqing municipality June 29, 2011.  Chinese President Hu Jintao warned on the 90th birthday of the ruling Communist Party that it still faced "growing pains" and that rampant corruption could lead to a loss in public confidence.  CHINA OUT   AFP PHOTO (Photo credit should read STR/AFP/Getty Images)
National Journal
Brendan Sasso
May 19, 2014, 2:17 p.m.

The Obama ad­min­is­tra­tion’s de­cision to bring crim­in­al charges against mem­bers of the Chinese mil­it­ary is already show­ing signs of strain­ing the U.S. re­la­tion­ship with China.

Shortly after the Justice De­part­ment ac­cused five Chinese of­ficers of hack­ing U.S. com­pan­ies, China an­nounced that it is with­draw­ing from a joint cy­ber­se­cur­ity work­ing group. The U.S. and China launched the work­ing group last year to try to reach agree­ments over the use of cy­ber es­pi­on­age.

Qin Gang, a spokes­man for the Chinese gov­ern­ment, said China will an­nounce more re­tali­ations “as the situ­ation evolves.”

Ac­cord­ing to the in­dict­ments, the five men were mem­bers of a hack­ing group that stole trade secrets from ma­jor U.S. com­pan­ies in­clud­ing West­ing­house, United States Steel, and Al­coa.

But the Chinese spokes­man claimed the charges were “based on de­lib­er­ately fab­ric­ated facts.” He also poin­ted to the Ed­ward Snowden leaks as evid­ence that the U.S. is hy­po­crit­ic­al when it con­demns oth­ers for spy­ing.

“China is a vic­tim of severe U.S. cy­ber­theft, wiretap­ping, and sur­veil­lance activ­it­ies,” he claimed.

When At­tor­ney Gen­er­al Eric Hold­er an­nounced the in­dict­ments Monday, he em­phas­ized that China’s be­ha­vi­or is fun­da­ment­ally dif­fer­ent than spy­ing by the Na­tion­al Se­cur­ity Agency. The U.S. may spy on oth­er coun­tries, but it does not steal secrets to give its own com­pan­ies an eco­nom­ic edge, he ar­gued.

Adam Segal, a seni­or fel­low with the Coun­cil on For­eign Re­la­tions, said it’s not likely that China will try to bring crim­in­al charges against NSA of­fi­cials or oth­er mem­bers of the U.S. gov­ern­ment. But he said he ex­pects China to take oth­er steps against the U.S. in the com­ing days.

Segal ex­plained that China doesn’t see an im­port­ant dis­tinc­tion between spy­ing to pro­tect na­tion­al se­cur­ity and spy­ing to help do­mest­ic com­pan­ies.

“There’s not such a clear line between the pub­lic and private sec­tor in China,” he said. “Their con­cep­tion of eco­nom­ic power and na­tion­al power doesn’t really see this dis­tinc­tion.”

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