Report urges US to go on offense on China hacking (Update)

May 22, 2013 by Shaun Tandon
The United States should consider curbs on Chinese investment or even offensive operations against hackers to address the growing toll from intellectual property theft, a report said Wednesday. File picture shows a customer looking at pirated DVDs at a shop in Beijing.

The United States should consider curbs on Chinese investment or even offensive operations against hackers to address the growing toll from intellectual property theft, a report said Wednesday.

The 11-month study led by high-ranking former US officials said that theft of software and other US-developed products was costing the American economy more than $300 billion each year—as much as the United States sells to Asia.

"The scale of international theft of American intellectual property today, we believe, is unprecedented," commission co-chair Jon Huntsman, the former US ambassador to China and presidential candidate, told reporters.

He said that the United States would have the equivalent of 2.1 million more jobs if foreign intellectual property standards were enforced to their fullest.

The report called for tougher measures by the United States, including scrutinizing foreign companies' treatment of intellectual property when they seek approval for investments in the world's largest economy.

It also urged the United States to look at changing laws to allow "offensive cyber"—chasing after hackers overseas to retrieve stolen information or even to physically disable their computers.

"You've got to have leverage in the game," Huntsman said. "IP theft needs to have consequences and with costs sufficiently high that state and corporate behavior and attitudes that support such theft are fundamentally changed."

The report—a private initiative also co-chaired by Dennis Blair, the former director of national intelligence—did not clearly recommend offensive cyber capabilities, noting the risk for unforeseen damage.

But it said that laws have not kept up to date with technology and that a purely defensive approach is likely to become "increasingly expensive and decreasingly effective."

"Almost all the advantages are on the side of the hacker; the current situation is not sustainable," it said.

The commission also recommended structural changes, including assigning the president's national security adviser to coordinate the US response to intellectual property theft.

The damning report comes ahead of talks between Presidents Barack Obama and Xi Jinping at a California resort on June 7-8, their first meeting since the Chinese leader took office.

Cyber issues are expected to be high on the agenda amid growing US accusations that China has waged a campaign of online espionage against US companies and the government.

In the past, China has defended its record and in turn accused the United States of unfair trading practices, such as denial of sensitive technologies and several high-profile rejections of Chinese investment bids.

Speaking earlier Wednesday at the Center for Strategic and International Studies, Chinese Ambassador to Washington Cui Tiankai said: "We should never politicize the economic issues because they will only make things more difficult to resolve."

Huntsman said he expected that Chinese officials would reject the report but voiced hope that it could provide ammunition for Chinese who support reform.

"They know that in order to reach out to the world, as many of the state-owned enterprises want to do, they are going to have to look and feel more like companies with global standards," Huntsman said.

Representative Mike Rogers, a Republican who heads the House Intelligence Committee, welcomed the report and said it showed the need for Congress to approve a law to let the government and companies share Internet information.

President Barack Obama's administration and civil liberties advocates oppose the law due to privacy concerns.

While the report listed China as the biggest culprit in intellectual property theft by far, commission member Slade Gorton, a former US senator, said that Russia, India and Venezuela were the next largest violators.

Explore further: US singles out Ukraine as key piracy center

add to favorites email to friend print save as pdf

Related Stories

US singles out Ukraine as key piracy center

May 01, 2013

The United States singled out Ukraine on Wednesday as a major center of intellectual property theft, saying that the government itself has been behind the growth in piracy in the country.

Chinese economic spying 'intolerable': US lawmaker

Oct 04, 2011

A US lawmaker said on Tuesday that Chinese economic espionage, including cyber spying, has reached an "intolerable level" and called for the United States and its allies to confront Beijing.

White House announces anti-theft trade strategy (Update)

Feb 20, 2013

The Obama administration announced new efforts Wednesday to fight the growing theft of American trade secrets, a broad but relatively restrained response to a rapidly emerging global problem that was brought ...

US urges China to probe, halt cyber spying

Mar 11, 2013

Beijing must take steps to investigate and halt cybercrime, a top US official said Monday, warning the international community cannot tolerate the widespread hacking coming from China.

China piracy costs almost million jobs: US study

May 19, 2011

US firms could support nearly one million more jobs if China stopped intellectual property violations, a study said, leading US lawmakers to call for a tough line with Beijing.

Recommended for you

LinkedIn to anchor new San Francisco high-rise

3 hours ago

San Francisco Mayor Ed Lee says the professional networking site LinkedIn will expand its presence in the city by anchoring a high-rise office building under construction.

Comcast 1Q earns beat Street on upbeat NBC result

22 hours ago

Comcast's first-quarter net income rose by nearly a third as ad revenue surged at broadcast network NBC, helped by the Winter Olympics in Sochi and Jimmy Fallon's elevation as host of "The Tonight Show."

Netflix poised to raise prices after strong 1Q (Update 2)

Apr 22, 2014

Netflix is preparing a sequel unlikely to be a hit with its subscribers. The Internet video service is about to raise its prices for the first time in three years to help pay for more Internet video programming such as its ...

User comments : 0

More news stories

Robot scouts rooms people can't enter

(Phys.org) —Firefighters, police officers and military personnel are often required to enter rooms with little information about what dangers might lie behind the door. A group of engineering students at ...

Finalists named in Bloomberg European city contest

Amsterdam wants to create an online game to get unemployed young people engaged in finding jobs across Europe. Schaerbeek, Belgium, envisions using geothermal mapping to give households personalized rundowns of steps to save ...

Internet TV case: US justices skeptical, concerned

Grappling with fast-changing technology, U.S. Supreme Court justices debated Tuesday whether they can protect the copyrights of TV broadcasters to the shows they send out without strangling innovations in ...

Brazil passes trailblazing Internet privacy law

Brazil's Congress on Tuesday passed comprehensive legislation on Internet privacy in what some have likened to a web-user's bill of rights, after stunning revelations its own president was targeted by US ...

In the 'slime jungle' height matters

(Phys.org) —In communities of microbes, akin to 'slime jungles', cells evolve not just to grow faster than their rivals but also to push themselves to the surface of colonies where they gain the best access ...

New alfalfa variety resists ravenous local pest

(Phys.org) —Cornell plant breeders have released a new alfalfa variety with some resistance against the alfalfa snout beetle, which has ravaged alfalfa fields in nine northern New York counties and across ...