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Daniel Russel, assistant secretary of state for East Asian and Pacific affairs, told a House hearing Tuesday that Beijing-backed economic cyber espionage is a major concern.

Stolen U.S. data is being “transferred to Chinese companies or state-owned enterprises and used for commercial gain,” Mr. Russel told a hearing of the House Foreign Affairs subcommittee on Asia and the Pacific.

He made the comments under questioning by Rep. Dana Rohrabacher, California Republican, who asked if party elites also are cashing in on the theft of U.S. trade secrets.

“Is there evidence that members of the Chinese Communist leadership who have been enriching themselves — we know how wealthy they are — have been involved with the theft of American technology?” he said.

Mr. Russel promised to investigate the matter and provide a written response.

Mr. Rohrabacher criticized the Obama administration’s indictment of five People’s Liberation Army hackers on Monday as a hollow gesture.

“I, of course, was hoping that this so-called pivot to Asia was going to result in a much more aggressive and realistic policy toward what I see is the major threat to America’s security and to free world security and stability and well-being,” he said.

As China is using military force in the South China Sea to enforce questionable maritime claims, the U.S. response was to indict five PLA hackers, the congressman said.

“That’s a joke. Five military computer hackers. I’m sure that the gang, the clique that runs China, the dictatorial and brutal and murderous clique that runs China is very impressed with the courage that we have in arresting the five military computer hacks,” Mr. Rohrabacher said.

Mr. Russel, in response, defended the largely symbolic legal action against the members of a secretive military hacking group, Unit 61398 in Shanghai.

“This reflects not a response to China’s foreign policy activities, but this reflects the strong commitment by President Obama, in focusing on cybersecurity and cybercrime, to address the challenge posed by Chinese government-sponsored cyber-enabled theft of the trade secrets and sensitive business information of U.S. companies,” Mr. Russel said.

Mr. Rohrabacher replied: “I would say that he is sending the wrong message, because arresting or indicting five military computer hackers is such a weak response, it will have the opposite reaction from dictators and the people who run China.”

“They are enriching themselves,” he said. “They brutally stamp out any opposition. There are no opposition parties there. They still kill people for believing in God, like the Falun Gong, who they throw into prison and then have murdered in order to take their organs and sell them. This is not a group of leaders of a country who would be impressed by the fact that five of their lower echelon have been indicted.”

John Tkacik, a former State Department China expert, said the federal grand jury indictment of the five Chinese hackers provided extensive details on Beijing’s cybercrimes and indicates that China probably uses cyber-penetrations to enrich both the state and Communist Party members “to the tune of trillions, not billions, of dollars.”

Mr. Tkacik said the National Security Agency, the electronic and cyber spying service, is capable of learning the facts on how Communist Party elites may have benefited from cyber spying.

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About the Author
Bill Gertz

Bill Gertz

Bill Gertz is a national security columnist for The Washington Times and senior editor at The Washington Free Beacon ( He has been with The Times since 1985.

He is the author of six books, four of them national best-sellers. His latest book, “The Failure Factory,” on government bureaucracy and national security, was published in September 2008.

Mr. ...

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