Mounting Threats

DNI: China, Russia grow as cyber, space threats to U.S. security

Director of National Intelligence James Clapper testifies on Capitol Hill
Director of National Intelligence James Clapper / AP
January 30, 2014

China and Russia pose significant threats to U.S. cyber and space systems, the director of national intelligence (DNI) told Congress on Wednesday.

James Clapper, the DNI, stopped short of saying both states are engaged in cyber attacks against the United States in a prepared testimony to the Senate Select Committee on Intelligence.

However, in a carefully worded assessment submitted as part of the annual threat assessment briefing, Clapper indicated that Russia and China are the main challenges in both the cyber domain and space arena.

In response to senators’ questions during the hearing, Clapper said that "foreign nation-states, principally China and Russia, … are the most sophisticated, [and] represent the most sophisticated cyber capabilities against us."

Chinese cyber operations were described as reflecting the Chinese Communist leadership’s priorities of economic growth, domestic political stability, and military preparedness, he said.

Clapper said Chinese cyber attacks were an "expansive worldwide program of network exploitation and intellectual property theft."

"Russia presents a range of challenges to U.S. cyber policy and network security," Clapper said in his prepared statement. "Russian intelligence services continue to target U.S. and allied personnel with access to sensitive computer network information."

China and Russia also were identified in the testimony as preparing for space warfare, what Clapper called "counterspace."

"Chinese and Russian military leaders understand the unique information advantages afforded by space system and developing capabilities to disrupt, damage, and destroy reconnaissance, navigation, and communications satellites," he said.

"China has satellite jamming capabilities and is pursuing anti-satellite systems."

Russian military leaders also openly state that Moscow’s forces deploy anti-satellite weapons and conduct anti-satellite research.

"Russia has satellite jammers and is also pursuing anti-satellite systems," Clappers said.

It was the first time during the annual briefing that Russian and Chinese space warfare capabilities were highlighted as U.S. national security threats.

Iran and North Korea also pose threats of cyber espionage and cyber attacks that seek to "either provoke or destabilize the United States or its partners," he said.

Three major cyber attacks identified in the prepared statement include the cyber attacks on South Korea in March that damaged tens of thousands of computers and disrupted online banking and automated teller machines. Another attack was a cyber strike on the Saudi Arabian national oil company Aramco in 2012.

"These attacks illustrate an alarming trend in mass data-deletion and system damaging attacks," Clapper said.

A third cyber attack took place against U.S. banks and financial institutions in early 2013 that caused financial losses.

U.S. officials at the time said the attacks were linked to an Iranian hacking group close to the Tehran government, although Clapper did not identify the perpetrators.

Other cyber threats include terrorist groups that have shown interest in developing offensive cyber attack capabilities. Terrorists "continue to use cyberspace for propaganda and influence operations, financial activities, and personnel recruitment," he said.

Networks the operate critical U.S. infrastructures, including industrial control networks used in water management, oil and gas pipelines, electrical power and others are "vulnerable to attack, which might cause significant economic or human impact," Clapper stated.

Additionally, hackers are now targeting physical objects such as vehicles, industrial components, and home appliances.

"The complexity and nature of these systems means that security and safety assurance are not guaranteed and that threat actors can easily cause security and/or safety problems in these systems," he said.

Hospital networks and the U.S. health care sector in general are also being targeted by digital attacks.

Clapper was asked during the hearing if there are estimates of the financial losses due to cyber attacks.

"I think it's almost incalculable to total up what the potential costs may be," Clapper said. "This starts from the sheer difficulty of ascribing value to intellectual property, particularly over time. … I really can't give you a good number. And we have a hard time coming up with one. Whatever it is, it's big."

Senators at the hearing noted that Clapper placed the threat of cyber attacks and espionage as greater than the threat of international terrorism.

China’s military buildup was described by the DNI as a "comprehensive military modernization."

"China’s military investments favor capabilities designed to strengthen its nuclear deterrent and strategic strike options, counter foreign military intervention in a regional crisis, and provide limited, albeit growing capability for power projection," he said, noting that last year the People’s Liberation Army deployed advanced weapons and reached key milestones for several advanced armaments, including multiple variants of advanced ballistic and cruise missiles.

Clapper made no mention of China’s recent hypersonic glide vehicle test. The experimental ultra-highspeed strike vehicle was tested Jan. 9 with a system that traveled nearly 8,000 miles per hour—fast enough to defeat U.S. missile defense interceptors.

Russia’s military is making "measured improvements," Clapper said, as part of a long-term rearmament.

"The military in the past year has taken an increasingly prominent role in out-of-area operations, most notably in the eastern Mediterranean but also in Latin America, the arctic and other regions, a trend that will probably continue," Clapper stated.

Moscow also is negotiating agreements with several nations that will allow access to military infrastructure around the world.

The bases will be used for Russia to "show the flag" but do not reflect plans for wartime missions or significant power projection, he said.