Jim Lewis
Appearances
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
So I've been negotiating on and off with the Chinese for about 30 years, starting out as a child, I might add. And one thing that's changed, they're much more confident. And I saw this with the Russians. I was at the UN, and the Russian ambassador was talking, and the Chinese ambassador opened the newspaper. I think it was the Post. It's like, I could care less what you have to say.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
And they feel that way about us now. All right. And so they feel like they're winning. Why would they do anything different? And on targets, the previous administration had some ideas about perhaps proposing along the lines of what we've been discussing. There's some targets that should be off limits, right?
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Now, point of fact, under international law, there are no targets that are off limits if they're not There are no targets that are off limits. You could debate that. But the Chinese basically said, we don't think the way you think. We don't think that you're going to have a set water facilities and you'll take them off the table. We look at it in terms of, what's the consequence if we do this?
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
We've judged it by consequence. If it's a little consequence, Podunk, Massachusetts or wherever the hell it was. We don't care. Is it something else? So they have a very different way of looking at this and a very different attitude. They're cautious.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
They're very cautious, but they feel like they're winning and that seeing them over a couple decades, they've gone from, they started out doing the old, you're the master, we're the student, tell us what to do. To now it's like, you guys are the past. We're here. We're not that cautious anymore. So I think it's a very different ballgame than it was, say, even 10 years ago.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Well, I had a specific request to them. Are you willing to engage in a... I don't negotiate for the U.S. government, but I will occasionally ask questions that the U.S. government has asked me to ask. And the answer was no, we're not interested. And part of it was, and some of these are people I've known for a long time, and they had a good point. And it's like, look,
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Five years from now, 10 years from now, we're going to be much stronger than you. So why should we make a deal with you now? Because we'll have a better hand to play five years from now.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
I used to think that the Chinese had an advantage because when they showed up, they never brought lawyers. We, of course, had thousands or even millions of lawyers with us. It's like, geez. One time I said, the worst thing we could do to you people is teach you to do this rule of law stuff.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Thank you. Thank you. Thank you.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Thank you.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
They actually believe it, though. From the first time I started talking to them about cyber stuff until now, they'll say, what are you complaining about? You do it too. Look up Rivet Joint. But when they say that, what they are thinking is they really believe it.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Chinese official in charge of their chip making program who told me, and this was a while ago, he said, look, every Intel chip comes with a backdoor. I said, no, you've got to be kidding. He said, no, every Intel chip has a backdoor. You have controlled the beating heart of China. That's their point. So they feel like, what are you complaining about?
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
But every time we've tried to block another country from getting a technology, all it's done is incentivize them. And this is the fourth or fifth time. So you don't win through export controls. And the Chinese say, I think I said this, the Chinese say all the time, you guys are so entranced with your success in the Cold War that you can't get over it.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
And you keep wanting to apply these Cold War tools to today. And they don't work.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
But to end on a positive note.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
There's a saying from 1900 that says that God protects drunkards, lunatics, and the United States of America. And I've used that with the Chinese because I've said, you guys are doubling down on Marxism, the great failure of the 20th century. And you're saying, we're having a crisis. And I tell them, we have crises every 30 or 40 years. It's like, eh, you know, we'll come out stronger out of this.
To Catch a Thief: China’s Rise to Cyber Supremacy
BONUS: Live Panel with Top China & Cyber Experts at The New York Stock Exchange
Do you really want to bet against Uncle Sam? And so I think that still shapes their thinking. I mean, they see us being a little bit in disarray, but they aren't quite sure that it's permanent.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
There's this sense that the displacement of ownership, that they're owed for the imperialism of the 19th century.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
And it goes back a long time. I was reading some memoirs from a British diplomat assigned to China in 1900. And he said that one of the things that impressed him was when a new British product showed up, there was a Chinese copy within a matter of weeks. So this has been going on for more than a century.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
One of the things about the Foreign Service is you change jobs every two or three years. And so I got into a new job. And the very first day, we had a meeting on McDonnell Douglas, now owned by Boeing. McDonnell Douglas built a plant in Shanghai. And the McDonnell Douglas guy said, you know, every morning when we come in, it's kind of like a fairy tale.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
Every morning when we come in, things have been moved a little bit. And so your government, being a bit paranoid, put cameras in the ceiling. The standard trick, by the way, so I'm not giving anything away. The Chinese should have known better.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
put government cameras in the ceiling and recorded the fact that every night the Chinese came in, disassembled every machine, took pictures of it, took pictures of what was being made, and it was like, holy cow. So that was the introduction for me for Chinese espionage. That was 26 years ago. That's been part of their growth plan since Deng Xiaoping, since the 1980s.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
They don't have the same sort of sense of ownership that we have.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
Well, there was a lot of concern about what should we do. And there was a strong sentiment. You see this a lot in administrations. China's a big market. There's a lot of money in China. And so there are people who will say, oh, boys will be boys. It's just espionage. You know, let's not rock the boat too much.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
It went on for 20 years, and then a godsend came along for the Chinese. The godsend was they connected to the internet. They connected to the high-speed networks. This was early 2000s. What they found is while the Americans were very excited to have created this internet thing, they had forgotten to lock it down. It's a brand new technology.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
You didn't think that the old rules where China was far away, it's actually about 10 milliseconds away. It was like letting a pig into a candy store. The Chinese had a field day and it's been like that ever since.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
The classic story is Nortel, a company that no longer exists.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
Huawei, assisted by the Chinese state, broke into Nortel, hacked their networks. And Nortel told me that sometimes they would come up with a technology, and before they could get around to manufacturing it, they would see a Chinese company put it on the market before they did. You can see the benefits. You didn't have to spend on R&D.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
You didn't have to do all the personnel stuff, but you got the technology. So Nortel's a classic example, and it's a strategic one because the Chinese carefully thought about what if we force everyone to use Chinese telecom infrastructure? Will that give us an advantage in signals intelligence? And the short answer is yes.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
And that's part of the reason we have so many problems today is that the Chinese developed a very successful model. Let's call it the Huawei model. And they're reluctant to give it up. White House paint is another example. Fiber optic cables is another example. High-speed trains is another example.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
You can find places where the Chinese state encouraged companies to go into a business and provided them both with financing but also with intellectual property.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
Thank you.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
We all know who Mao Zedong is, right? Great leader of China, currently popular again, thanks to Xi Jinping, the current leader. Mao had some rather strong views about Marxism. One of the strongest views he had was that it would work. He was wrong on that, which was the problem. So when Deng, who was Mao's successor, came in, he discovered that China was impoverished. It was bankrupt.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
It was so far behind the Soviet Union back then, the Soviet Union and the US, that the Chinese were afraid they would never catch up.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
Deng inherited a China that was a mess, and he came up with two ways to fix it. The first was to open the Chinese economy to the West, let American companies, European companies, Japanese companies invest. The second was to start a gigantic espionage campaign to steal intellectual property. and to use that as the basis for China to build its own capabilities.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
You had the government telling people what to do. And China, more or less, but much more skillfully, copied this Soviet model of state planning. And the five-year plan is a decision on where China thinks it should invest its money, where it should force its companies to go, what the government should do. We have Wall Street, they have Beijing.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
You can judge which one works best, but it's their economic plan for what their economy will do.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
At least some of them were thinking, how do we leapfrog the wicked Westerners?
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
We had a senior defense official who said to the Chinese, look, you spy on us. We spy on you. We get it. Everybody does that. What we don't do is we don't steal technology. We don't steal intellectual property. And we'd like you to stop. And a senior PLA colonel said, you have this firm line between political military espionage and technological espionage. That line doesn't exist for us.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 3: The Most Dangerous Time in American History
When we steal technology, we are building our economic base. we are building our national security. So at that moment I thought, it's going to be tough to get these guys back on the ranch.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
Well, it's the Uyghurs. It's Tibetans. Everyone knows that with the Dalai Lama. It's Falun Gong. The Chinese had a dreadful shock with Falun Gong. Some years before all this, there were Falun Gong protests in Beijing, and the government didn't know they were going to happen. So then you had a lot of old ladies doing Tai Chi in the middle of, in front of the Forbidden City.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
Why that was frightening is another question. But the fact that Falun Gong was able to sneak up on them was one of the things that set off this massive investment in domestic surveillance. The democracy movement, which is pretty squashed, she's done a good job of squashing it. And then finally, Taiwanese independence. So the things that the Chinese see as a threat, notice we're not on that list.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
I mean, we'd probably, if you had six poisons, maybe we'd make it. But it's the concern with the continuity of party leadership, of unchallenged party rule that drives a lot of Chinese activity.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
If it works at home, why not do it overseas? It's a little harder because, you know, in China they own the networks, they can put cameras up, they have everybody's birth certificate, but they're doing their best to wire the world for Chinese surveillance.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
You don't hack infrastructure for fun, right? It's reconnaissance. It's target reconnaissance for the event of a conflict between the United States and China.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
I think it's the greatest transfer of wealth in history. So they call it advanced persistent threat.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
How many? How many do you have?
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 1: The Five Poisons
The Chinese leadership is really paranoid. You know, my old joke is that we're actually target number two for the Chinese, target number one is their own people.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
When you join the government, you have to fill out a form that lays out, have you ever been arrested? Did you smoke dope? Blah, blah, blah. The correct answer is no, by the way. And they got all those forms.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
They sat down with their Chinese counterparts and had very long negotiations. Some of them ran... from dinnertime to the next morning on what would the Chinese be willing to give up. It's not like the Chinese said, okay, we give up, you caught us. They, of course, fought every inch of any concession, right?
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
And it took the powerful threat of Obama canceling Xi's visit, of Obama telling the world he's canceling Xi's visit because of this espionage. The Chinese couldn't accept that.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
talking to some of the current leaders on the Hill who are very concerned with China, as they should be. And I said to them, what's your engagement strategy with China? And their response was, oh, we don't have an engagement strategy with China because they don't agree with us. Can you imagine Brzezinski or Kissinger saying we're not going to talk to them because they don't agree with us?
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
That's kind of the whole point. It will be difficult, but we are going to need to sit down with the Chinese, with our allies, and say, you're not going away. How do you fit into the world? What is the end game here? How do we integrate China as a responsible participant? You know, the U.S. is still kind of, we're in like that early 1950s hysteria over China. Chinese are bad, no doubt about it.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
And hacking is part of that. But we have to come up with an engagement plan that eventually leads to China being more responsible in international relations. We don't have that now.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
Well, remember the end of the Clinton administration, we thought the Chinese were going to be friends. It was probably a little naive, but what the heck? America and China would have a global partnership where they would set the rules and, you know, work together and we were all going to be friends. And it was the end of history and we could say kumbaya.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
And the Chinese kind of believed it too, at least some of them. And at the same time, you had this background of intense espionage. There was a debate in China that wasn't resolved until a few years ago. Do we become more international, more like what the Americans want us to be, where we play by the rules that the rest of the world plays by?
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
Or do we become more nationalistic and put China's interests first? Unfortunately for us, it was the nationalists who won.
To Catch a Thief: China’s Rise to Cyber Supremacy
Ep 5: A Cyber Detente
There was always this sense of, look, it's a trade. We know they steal from us, but we get a lot of money out of China. So right now the trade works in our favor.