The Growth of Economic Espionage: America Is Target Number One
Article Summary and Author Biography
As economic strength becomes the new currency of national power, theft of high-tech secrets is displacing old-fashioned spying. The United States must protect its companies, but it should not join in this euphemism for mercantilism.
Peter Schweizer is a Visiting Scholar at the Hoover Institution and author of Friendly Spies: How America's Allies Are Using Economic Espionage to Steal Our Secrets.
Shortly after CIA officer Aldrich "Rick" Ames began selling secrets to the Soviet KGB in 1985, a scientist named Ronald Hoffman also began peddling classified information. Ames, the last known mole of the Cold War, received $4.6 million for names of cia informants before he was apprehended in early 1994. But Hoffman, a project manager for a company called Science Applications, Inc., made $750,000 selling complex software programs developed under secret contract for the Strategic Defense Initiative (SDI). Hoffmann, who was caught in 1992, sold his wares to Japanese multinationals--Nissan Motor Company, Mitsubishi Electric, Mitsubishi Heavy Industries, and Ishikawajima-Harima Heavy Industries wanted the information for civilian aerospace programs.
Ames received the more dramatic and sensational coverage, as he should have, given that his betrayal led to the loss of life. But the Hoffman case represents the future of intelligence. While one spied for America's chief military rival, the other sold information to a major economic competitor. Perhaps it should induce an epiphany of sorts that these two cases occurred in near congruence.
As economic competition supplants military confrontation in global affairs, spying for high-tech secrets with commercial applications will continue to grow, and military spying will recede into the background. How the United States elects to deal with this troubling issue will not only determine the direction of the American intelligence community, but also set the tone for commercial relations in the global marketplace.
THE NEW CURRENCY OF POWER
Most economic agents systematically collect economic intelligence using legal means. Major corporations collect business intelligence to read industry trends and scout the competition. Many nations track global and regional economic trends and even technological breakthroughs to aid policymakers. But a growing number of states have become very active in gathering intelligence on specific industries or even companies and sharing it with domestic producers. Indeed, economic espionage, the outright theft of private information, has become a popular tool as states try to supplement their companies' competitive advantage. This is sheer folly, threatening to restore mercantilism through the back door.
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