Week in Review, March 11-16 *Exclusive

By EWI BLOG | by Rachel Ehrenfeld
Sunday, March 17th, 2013 @ 4:25PM

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Apart from the election of Pope Francis, North Korea’s tearing up the 1953 Armistice and the Obama administration’s sudden turnaround on missile defense in response, this was the week that the U.S. purportedly wanted to be seen as the one in which it got tough on the Chinese over cybersecurity.
The past week had been dubbed “Sunshine Week” by the administration to celebrate its openness.  The first thing celebrated was its administrative reform of FOIA. However,Americans requesting documents under FOIA are getting less information because of an executive order issued by the president on December 29, 2009, that allows the government to classify certain types of information related to national security after it has been requested. This, in effect, has largely undermined our freedom for information and created opacity and smoke instead of transparency and clarity.While the government successfully blocks our access, it seems to have done little to limit the freedom of Chinese, Russian, Iranian and other hackers from stealing our national and industrial secrets as well our personal information, including our bank accounts.

The General Services Administration (GSA) warned U.S. government vendors it has “recently identified a security vulnerability in the System for Award Management (SAM),” and warned that “Registrants using their social security numbers instead of a TIN for purposes of doing business with the federal government may be at greater risk for potential identity theft.”

On March 11, National Security Adviser Tom Donilon described the problem as –

‘a key point of concern and discussion’ and suggested that ‘Beijing should take serious steps to investigate and put a stop to these activities.’ He then went on to clarify that the cyber attacks should not be used “to derail President Obama’s second-term effort to improve ties” with China.

Beijing’s response the next day was to offer to talk about the cyber problem, claiming that it has been a victim to U.S. hacking.

While Donilon was talking, others focused on the results of the Defense Science Board’s (DSB’s) 18-month study on U.S. military, which reported on the dismal vulnerability of our military.

At the same time, Director of National Intelligence James Clapper’s Hill testimony on security threats, emphasizing threats to U.S. public infrastructure. However, he suggested that –

“such a devastating attack against the United States outside of a military conflict or crisis,” for at least two years, and left the door open for some sort of diplomatic solution to cybersecurity:

With this, the administration has given yet another sign that it is not averse to some kind of international Internet control of the sort the Chinese have been advocating–inviting the cat to guard the butter jar.

The Administration was presented with several options including “using bilateral and multilateral diplomacy, conducting covert computer network attack operations, levying economic sanctions, and taking legal action against the Chinese government and military…to pressure China into halting the cyber attacks.”

In response, in late 2011 the White House rejected all of this in favor of a limited response of diplomacy and law enforcement efforts. Moreover, some reports suggested the government has not informed the private sector of Chinese cyberespionage and stealing of manufacturing and trade secrets.

If foreign infringement of our national, industrial and personal information wasn’t enough,

Reuter’s noticed that the Obama administration is drawing up plans to give all U.S. spy agencies full access to a database that contains financial data on all American citizens and others who bank in the U.S. Never mind that the FBI already has access to this information. It is to be expected that once this becomes more widely known, the general public will protest the government’s hacking into U.S citizens’ bank accounts.

Read More: The Cloudy Sunshine Week


Yoram Schweitzer, Gabi Siboni, and Einav Yogev of INSS offered an excellent primer on how technological developments are rapidly changing cyberspace’s virtual reality into the new battleground for terrorists and criminals alike:

In December 2001, at a meeting in New York shortly after the 9/11 attacks, the philosopher Jacques Derrida presented his understanding of the changes generated in the world as a result of those events. According to Derrida, the attacks were still part of the “archaic theater of violence,” the real, visible world, in which events are still conducted in “clear and great order.” However, according to him, cyberspace presents us with a more potent threat to our political and physical world; the dangers inherent in it change the relationship between terrorism, in the psychological and historical sense of a violent attack, and the concept of territory.

Now, in the new techno-scientic world, the threat we knew in the past as real has become an invisible, quiet, and swift threat, devoid of bloodshed, which, according to Derrida, is worse than the 9/11 attacks, which at least were directed against a known location at a particular point in time. Now we are facing a challenge that threatens the social and economic fabric of life that connects all of us and upon which all of us depend in every place and at every moment.

Read More: Terrorism in Cyber


As China accelerates it cyber attacks, the new President Xi Jinping is on an PR campaign to assert his charisma as well as the Communist Party’s control. But neither will help solve China’s deep economic troubles. China expert Harvey Nelsen, opined, ”

The advantages, indeed the necessity,of asymmetrical warfare for the Chinese require a heavy dependency on cyber offense.  On the economic front, most Chinese companies lag far behind best Western and Japanese technologies and cyber intelligence is an excellent means to leapfrog forward. The US is not going to be able to wean China off the cyberwar nipple.”

It should.

Previous economic changes have contributed to the rise of a middle class, which is being apprehensive of growing inflation and low interest rates on deposits. Especially so, since state-owned enterprises “can access money at below market rates.”

Their revenues, however, go abroad, especially to Africa and Latin America, and increasingly to Europe and the States. In addition, China Development Bank (CDB) has been handing out billions in “development loans,” especially to countries with large energy resources. …Chavez’s Venezuela, for example, received at least $40 billion, “$1,400 for every man, woman, and child” in the country.

Worries about a wide range of weaknesses in China’s economy are not new. Those who assumed that the Chinese leadership would try addressing them were proven wrong, argues Sol Sanders.

In a troubled world, the obstacles to continued growth and stability in Communist China are staggering compared to the crises of the Euro and Sequestration. Most foreign observers are either willfully blind to the growing evidence or facing a possible period of worldwide economic decline, they still hope growth in China (and perhaps India) will be the salvation. It won’t…

In fact, many of the problems facing Xi and his buddies in the Standing Committee of the Politburo — now reduced to seven from nine to make it more efficient — are seemingly beyond China’s control. The remarkable growth and prosperity of the past two decades for millions of Chinese living in the coastal cities was based on two pillars: a rapid expansion of exports and expanding infrastructure of monumental dimensions.

Both of these phenomena are in trouble. Despite huge subsidies including a manipulated currency, the long-term outlook for exports is poor what with the continued crisis in the European Community and a slow American recovery. Furthermore, rising wages and other problems — there have been strikes — are threatening the low wage end of the Chinese exports which are moving off to Southeast Asia and other cheap labor countries. In some instances, with the digital revolution creating new economies, some manufacturing is moving back to Japan and the U.S. (In the American case, of course, the shale gas revolution which has chopped energy costs in the U.S. is encouraging such movement.)

Read More: Paper Dragon?

Morsi’s Muslim Brotherhood gets US Support



As Egypt’s seeming deliberate and continuing slide toward economic, political and social implosion-we argued that the Muslim Brotherhood should adopt the locust as a national symbol: “Like the locust, swarms of Brotherhood eat away at every progressive development on the land, destroy the economy, and turn sprouts of reform into scorching oppression.”

Early last week, Morsi turned down an offered $750 million bridge loan from the IMF the country sorely needed to maintain its foreign exchange reserves. This was the IMF’s attempt to get Morsi’s government to finally do what was necessary to secure the larger $4.8 billion loan so long under negotiation. But Egypt’s Minister of Finance rejected the offer, arguing, “It is our right as a nation, and as a member nation of the IMF, to receive 300% of our quota, or $4.8 billion.”

Morsi and company’s attempt to get their way received a boost from State Secretary John Kerry’s gift of $250 millionand additional $250 million for “climate projects” from the World Bank. Recognizing Washington’s gift, Morsi promised to make the IMF happy, only to turn down their bridge loan a few days later.

Unable to pay for imported necessities, food and fuel, Egypt will sink into total chaos. As is, Morsi’s government has yet to bring order to the streets. An overwhelming percentage of the regular police forces in the country are on strike. Critical coverage of the government in Egyptian newspapers has led to a Brotherhood assault on the media and independent reporting has become increasingly difficult.

The Egyptian military plays along, as Professor Hillel Frischargues, because the majority of its soldiers support the Brotherhood. He also argues that the generals fear the suspension of U.S. military assistance, which totals $1.3 billion and constitutes a fifth of the defense budget.

Director of National Intelligence James Clapper sees a Brotherhood-dominated Egypt as no particular threat to U.S. or Israeli interests. Clapper’s attributed the wide protests in Egypt to Morsi’s “decree in November 2012 that temporarilyincreased his authorities at the expense of the judiciary.” (emphasis added)

On what basis does Clapper sees this power grabbing as “temporary?”

On February 5, celebrating the delivery of four F-16 fighter planes to Egypt, then-Defense Secretary Leon Panetta, “urged his Egyptian counterpart, Abdul Fatah Sissi, not to use the U.S.-financed Egyptian military against protesters.” Seemingly oblivious to the economic collapse and increasing chaos, the Obama administration is accelerating the delivery of additional 16 F-16 fighter planes, and 100 Abrams tanks, to the Brotherhood.

As soon as Morsi’s locust policies fail to feed his people, chaos and rebellion are likely to ensue. To hush the restive crowds he’ll use American fighter planes and tanks, and then blame the American weapons for the bloody outcome. Another example of America’s loosing foreign policy.

Read More: Locust Time in Egypt


Meanwhile, tourism, one of Egypt’s economic mainstays has been decimated.

Walking out of the sparsely occupied once luxurious hotel in Cairo, you may consider buying a 6,000 to 20,000 volt tazer, or an electric shock baton to protect yourself from robbery, sexual harassment, or even rape. However, there is a good chance that strong anti-American sentiments could entice the vendor who sold you the tazer to accuse you of stealing or spying. Your newly acquired tazer would do little to prevent the vendor, jihadist militias, or members of the Moral Police -all armed with their own tazers and electric shock batons – from exercising their newly decreed power to carry out “judiciary policing” (citizen’s arrest). The chances are you’ll never make it to Giza, Abu-Simbel temples, Luxor, or Sharm el-Sheikh.

Morsi’s Muslim Brotherhood rule has left the pyramids and the great sphinx of Giza, deserted. While the government claims 30 percent decline in tourism, industry-expert figures are closer to 90 percent. And as if the rampant violence wasn’t enough, police stations across Egypt are on strike – even refusing to protect Morsi’s residence. They protest the Minister of the Interior’s “Brotherhoodstion” of the police.

J. Millard Burr’s Terror Tourism offers a new approach to draw the tourists back to Egypt,

Egypt should challenge the jaded world traveller.  He or she should be enticed to avoid the jejune tourist package and instead book passage on an Egyptian terrorism tour.   Such tours could include, but are not limited to:

Attempt to cash a check anywhere in the Sinai; Book a room in the Semiramis Hotel, Cairo.  Attempt entering the Egyptian Museum located just off Tahrir Square.  Take a taxi from Cairo to the pyramids at Giza.  Take a balloon ride in Luxor.  Spend a weekend in a beach hotel in the Salafist stronghold of Mersa Matrouh.  Spend a day shopping in Port Said, amidst thousands of demonstrators clashing with the police; . Go to soccer game or ant other public sporting event anywhere in Egypt.  Visit the Islamist watering-hole of Assiut and ask for a Stella beer.  Join the rioters in their daily revelries in Alexandria.  Take your topless bathing girlfriend to the beach at El Arish.  Race a car from Rafa, Sinai along the border with Israel to the Sharm el Sheikh dive-spot.  Join the Libyan crazies in a drive from Mersah Matruh to the ancient Siwa Oasis.  Meet the locals by joining a queue in the hope of purchasing a few liters of diesel.  Then Join a queue in the hope of purchasing a few pounds of flour.  Join a queue Again…and again….

Read More: Come to Egypt – We’ll Take Your Breath Away … Literally


The Muslim Brotherhood continues the process of destroying Egypt with one ideologically driven catastrophic error in judgment after another, fuelling chaos and violence.  More than 50 people have died in Port Said in the past month, and large numbers of the police are on strike, protesting the government attempts to “Ikhwanise” the police.

Despite this and other distressing news out of Egypt, the U.S. is charging forward with what looks to the Egyptian opposition and observers from all over as a wholesale sellout to the Muslim Brotherhood.  John Kerry’s recent visit’s gift of $250 million in U.S. assistance would surely help the Morsi government.

If that we’re enough, Kerry engaged in talks abut the Qualifying Industrial Zones accord, including negotiations regarding reducing the required proportion of Israeli components in Egyptian textiles granted tariff-free access to the United States.

Geopolitical analyst F. William Engdahl opined:

“The U.S. Bet their money on the wrong horse by backing the undemocratic Muslim Brotherhood: “The US is wrong to cooperate with the current Egyptian authorities as the Muslim Brotherhood has a “dictatorial authoritarian” agenda, with no intention to make democratic changes in Egypt.”

As Engdahl sees it:

“Some people around president Obama have the delusion that they could control what’s basically a political Islamo-fascist movement. It’s not a movement for democracy by any stretch of the imagination. And that’s what this Brotherhood is – it’s a secret society. They have a public agenda that sounds lovely, and they have a private agenda that we’re seeing unfold in Egypt now.”

James Dorsey, writing about the Ultras and the soccer riot that led to the Port Said protests, suggested:

The problems with law enforcement and the judiciary are compounded by the fact that Port Said-related demonstrations that are now in their second month have persuaded security forces to stage their own protests. Rank and file officers are speaking out publicly for the first time with walk-outs across the country and refusals to engage in crowd control.

Egypt’s 1.7 million-strong police and security forces, widely viewed as the repressive arm of Mr. Mubarak’s regime and largely unrepentant and unreformed since his departure, feel caught between the rock of President Mohamed Morsi’s insistence on cracking down on protests and the hard place of the public denouncing their brutality…

Highly politicized and street battle hardened soccer fans in Port Said as well as Cairo…counted 70 dead among their ranks in last year’s incident believe it was an effort that got out of hand to teach a less to fans who had played a key role in the toppling of Mr. Mubarak and were in the forefront of opposition to the military that led Egypt to elections last year that brought Mr. Morsi to power as well as the current demonstrations against the Morsi government.

As a result…failure to convict all nine officers coupled with the absence as of this writing of a justification of the court’s verdict has reaffirmed perceptions that law enforcement and the judiciary are political and constitute laws unto themselves.

Read More: U.S. Betting on the Wrong Egyptian Horse

Categories: ACD/EWI Blog, Cyber

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