Obama Administration Explores Sanctions In Retaliation To Chinese Cyberthreats

In Beijing, President Barack Obama smiles next to China’s President Xi Jinping during a welcome ceremony in 2014. CREDIT: AP PHOTO/ANDY WONG
In Beijing, President Barack Obama smiles next to China’s President Xi Jinping during a welcome ceremony in 2014. CREDIT: AP PHOTO/ANDY WONG

China may soon face economic sanctions as a warning shot from the Obama administration in light of recent cyberattacks. According to a Washington Post report, the U.S. government is deciding whether to issue sanctions, which could be finalized as soon as mid-September, to reprimand Chinese companies gaining from U.S. economic data stolen by Chinese hackers.

Officials told the Post that Chinese hackers have stolen nuclear power plant designs, source code for search engines, details from energy companies’ confidential negotiations, among other things, and Chinese companies are using the information for an economic advantage.

But the potential move will also likely coincide with Chinese President Xi Jinping’s visit to the United States, which is already tinged with concerns over the volatile economic changes tied to China’s stock market, a deadly chemical warehouse explosion, and the yuan’s stark dip in value.

Sanctions can potentially stifle or at least startle a country’s economy but are largely an overt political expression of disapproval — a gesture that could be considered long overdue for America’s second largest trading partner and the world’s second biggest economy.

Underneath the globe-leading economies, U.S.-China relations have been undermined by near constant cyberattacks. FBI director James Comey said China hacked teh U.S. daily, likening them to a “drunk burglar,” during a CBS 60 Minutes segment:

I liken them a bit to a drunk burglar. They’re kickin’ in the front door, knocking over the vase, while they’re walking out with your television set. They’re just prolific. Their strategy seems to be: ‘We’ll just be everywhere all the time. And there’s no way they can stop us.’

The sanctions would be an important public response to cyber transgressions launched by foreign countries. China was linked to the United Airlines breach and the deeply invasive hack of federal background records from the Office of Personnel Management in July.

The Chinese military has also been connected to past hacks on American companies. The Justice Department charged five Chinese military officials with criminal espionage, straining U.S.-China relations.

If approved, the use of sanctions could further complicate the relationship between two countries that are inextricably dependent on one another for investment and continued growth.

As an indication of the storied and complex relationship, Johns Hopkins China scholar David Lampton said in a 2001 Frontline interview that “Our relations with China have been, and will remain for the foreseeable future to be mixed, to be a complex combination of cooperation and contention. So the first thing is, don’t ever expect a kind of nirvana of peaceful, cooperative productive U.S.-China relations.”

Lampton amplified those sentiments during a speech at a China reform conference in May:

The tipping point is near. Our respective fears are nearer to outweighing our hopes than at any time since normalization. We are witnessing the erosion of some critical underlying supports for predominantly positive U.S.-China ties. Though the foundation has not crumbled, today important components of the American policy elite increasingly are coming to see China as a threat to American ‘primacy.’