The Voice of the White House

Washington , D.C. , April 12, 2008 :”Much ado in the papers about the major drug companies. We note that certain very popular drugs made and sold by major drug companies kill or disable too many people. Much shock and horror. Why, I do not know. These people are friends of George W. Bush and he has made it very plain to the Federal regulatory agencies that interfering with his friends is not to be done.

The drug companies can absolutely count on being supported by the Bush-appointed judges and left alone by the regulatory people. Any Federal employee who dares to contradict Bush is immediately fired, as have been a number of high-ranking military leaders who won’t put up with his puerile lies.

The Chinese, who have no problem bribing people, have whined that their lead-tainted toys are quite safe and that their medicines, heavily contaminated with dangerous chemical residues, are even more safe. And because Bush is known to take bribes, they get away with it.

Woodrow Wilson was a Democrat, a prig and an asshole but he never took bribes. U.S. Grant had a very corrupt administration but Grant never took a dime. Bush has been on the take since he used his family influence to get various oil industry jobs.

The whole family is as crooked as a Swiss mountain road and George is no exception. Also, Georgie is a vicious little rat who loves to torment people and if he can do this and get bribe money for it, so much the better.

George W. Bush is a drunk, a liar and a thief and the sooner he leaves office, the better off for every man, woman and child in the United States .

Boycott the Olympics? When he can stuff mattress covers full of hundred dollar bills safely on Air Force One? Not bloody likely. Well, for the trailer park trash and the Jesus freak idiots who voted for him, I hope you swallow the wrong pill and turn a delicate shade of blue.”

Editorial

All the Time He Needs

April 13, 2008

New York Times

President Bush said last week that he told his Iraq war commander, Gen. David Petraeus, that “he’ll have all the time he needs.” We know what that means. It means that the general, like the Iraqi government, should feel no pressure to figure a way out of this disastrous war. It means that even after 20,000 troops come home there will be nearly 140,000 American troops still fighting there — with no plan for further withdrawals and no plan for leading them to victory. It means, as we’ve always suspected, that Mr. Bush’s only real strategy for Iraq has been to hand the mess off to his successor. Mr. Bush gave himself all the time he needs to walk away from one of the biggest strategic failures in American history.

General Petraeus and Ryan Crocker, the American ambassador to Baghdad , did not try to hide any of that in their Stay-the-Course 2008 Tour. There were the obligatory claims of military and political progress, but with a lot less specificity than during Stay-the-Course 2007. Mr. Crocker did not even bother to bring charts assessing Iraqi performance on political benchmarks. General Petraeus’s charts showed that American troop numbers would come down to around 140,000 this summer — but showed nothing beyond that.

When members of Congress pressed him to explain what would have to change on the ground for him to agree to further withdrawals, the general did not have an answer. He certainly is not getting any pressure from the White House to come up with one. As they say in the military, Mr. Bush is a short-timer, so why should he worry?

Whoever wins the presidency will not have the same luxury. He or she will have to start quickly planning for an orderly withdrawal. Even Senator John McCain will have to realize that America ’s forces cannot sustain this pace for much longer. Earlier this month, The Times reported that repeated battlefield tours have so debilitated American troops that Army leaders fear for their mental health. Last week, Gen. Richard A. Cody, the Army vice chief of staff, warned Congress that the demand for troops in Iraq and Afghanistan “exceeds the sustainable supply.”

Mr. Bush cut Army combat tours in Iraq from 15 months to 12, but the Pentagon said that will not relieve the strains on troops and their families or allow the United States to send the reinforcements it desperately needs to Afghanistan .

The faltering American economy also cannot afford this never-ending war. Mr. Bush’s description of his latest emergency spending request as a “reasonable $108 billion” proves just how out of touch he is with fiscal reality. His attempt to justify the overall $600 billion cost so far by comparing his war to the cold war and the need to stop “Soviet expansion” shows that he is even more out of touch with strategic reality.

We believe that the fight against Al Qaeda is the central battle for this generation, but Mr. Bush’s claim that Iraq is the main front is wrong. That is Afghanistan , and the United States is in real danger of losing because Mr. Bush’s failed adventure in Iraq is eating up the Pentagon’s resources and attention.

It is clear that Mr. Bush has no intention of coming up with an exit strategy, but even now there are things he could be doing to give his successor a better shot at containing the chaos after American troops leave.

·                     Press for Real Political Reforms The surge was supposed to give Iraqi politicians breathing room to make necessary political reforms. They still have not agreed on a law to equitably divide the country’s oil wealth, or rules for this fall’s provincial elections.

The performances in Washington last week merely confirmed what the Iraqis knew: the president is just playing out his string. Mr. Bush might have more luck telling Prime Minister Nuri Kamal al-Maliki the truth: if the Democrats win in November, the days of enabling will certainly be over, and that is likely to happen even if the Republicans hold the White House. If they know the Americans will not be there to guarantee their survival, Iraq ’s leaders might be more open to compromise.

·                     Make the Iraqis Pick Up the Check Even some of the war’s most enthusiastic G.O.P. backers on Capitol Hill are joining the Democrats to demand that the Iraqis start paying for military training and the fuel bill for American soldiers. We suspect that has a lot to do with voters’ fury over high gasoline prices, the mortgage crisis and the lagging economy.

The Iraqi government is estimated to keep $27 billion in reserves in its central bank, $30 billion more in American banks and tens of billions of dollars elsewhere. If they have to pick up more of the check, Iraqi leaders may be more eager to focus on political reform and improved military training.

·                     Really Talk to the Neighbors Mr. Bush announced that he is dispatching senior American diplomats to the region to urge Arab states to do more to help Iraq , starting with reopening their embassies in Baghdad . Secretary of State Condoleezza Rice will also attend a conference of neighboring states and another aid-pledging meeting.

The problem goes far beyond embassies and aid. Foreign fighters are not the war’s main driver but they are a lethal problem. And once American troops withdraw, the temptation to meddle — by Iran and Syria but also by Turkey and Saudi Arabia — will be immense.

All these countries need to understand that chaos in Iraq is a threat to everyone, and there is no guarantee that it will not spill over Iraq ’s borders. More bullying and bluster from the president is not likely to get that message across. Nor are canned speeches at conferences. Mr. Bush needs to send his top officials for serious one-on-one discussions with all of Iraq ’s neighbors, including Iran and Syria .

·                     Refugees There are now an estimated 2.4 million Iraqi refugees — mostly in Syria and Jordan — and 2.7 million more Iraqis displaced within their own country. The United States bears direct responsibility, and it needs to do a lot more to help these people survive and find safe refuge, back in Iraq or in other countries. It also needs to — humbly and urgently — ask its allies in Europe , Asia and the region for help.

Beyond the intolerable human suffering, huge flows of refugees could spread Iraq ’s conflict far beyond its own borders. This is not a problem that can continue to be ignored.

·                     An Honest Assessment of Iraq ’s Army This White House has been spinning on Iraq for so long that we suppose we should thank Mr. Maliki for his recent reality check: his decision to send Iraqi forces into Basra to oust militias loyal to the radical cleric Moktada al-Sadr.

It was not a pretty sight. One thousand Iraqi soldiers and police officers refused to fight or deserted their posts. The battle ended with no winner and only after the Iranians helped broker a cease-fire. President Bush and General Petraeus owe the country a rigorous and honest assessment of the American training program, starting with what went wrong in Basra . What needs to be changed now to increase the chances that the Iraqi Army will eventually be able to fight its own battles? How long, realistically, will it take for that to happen?

Mr. Bush’s capacity for denial is limitless. Perhaps he believes that the next president will continue this misadventure without any end in mind, let alone in sight. Even then he owes it to his successor to use his remaining nine months in office to try to address Iraq ’s myriad problems. That will not excuse Mr. Bush’s serial failures. But it may increase the chances for the inevitable withdrawal to be as orderly as possible.

Mr. Bush has all the time he needs, but Iraq ’s suffering civilians do not, and neither do its masses of refugees, the bloodied and strained United States armed forces, or the American public.

US GIs in Iraq Suffer Worst Week of '08

April 12, 2008

by Robert H. Reid

Associated Press

BAGHDAD - A roadside bomb killed an American soldier in Baghdad on Saturday, capping the bloodiest week for U.S. troops in Iraq this year. Clashes persisted in Shiite areas, even as the biggest Shiite militia sought to rein in its fighters.

At least 13 Shiite militants were killed in the latest clashes in Baghdad 's militia stronghold of Sadr City , the U.S. military said. Iraqi police said seven civilians also died in fighting, which erupted Friday night and tapered off Saturday.

The U.S. military said the American soldier was killed in a blast Saturday morning in northwestern Baghdad but did not say whether Shiite militiamen were responsible.

The death raised to at least 19 the number of American troopers killed in Iraq since last Sunday.

American casualties have risen with an outbreak of fighting in Baghdad between U.S. and Iraqi forces and the largest Shiite militia - the Mahdi Army of anti-American cleric Muqtada al-Sadr.

Al-Sadr, who is believed to be in Iran, repeated on Saturday his demand for American soldiers to leave the country and urged his fighters not to target fellow Iraqis "unless they are helping the (U.S.) occupation."

Al-Sadr also blamed the Americans and their Iraqi allies for the assassination Friday of one of his top aides, Riyadh al-Nouri, director of his office in the Shiite holy city of Najaf .

Gunmen ambushed al-Nouri as he was returning home from Friday prayers, and al-Sadr followers shouted anti-American slogans at his funeral in Najaf.

Despite the strident rhetoric, however, there were signs that al-Sadr was trying to calm his militia to avoid all-out war with the Americans. Al-Sadr is also under pressure from Prime Minister Nouri al-Maliki, also a Shiite, to disband the Mahdi Army or face a ban from politics.

Sadrist officials told The Associated Press they had received orders from their headquarters in Najaf to avoid confrontations with Iraqi and U.S. forces unless the Americans try to move deep into Sadr City , which has been under siege for two weeks.

The officials said the Sadrist leadership was concerned that the ongoing clashes were turning into a war of attrition that was weakening the movement and undermining support within its Shiite power base.

The officials spoke on condition of anonymity because they were not supposed to discuss policy with outsiders.

In a move to bolster its image among Sadr City residents, the government Saturday lifted a ban on entering and leaving the district, home to some 2.5 million people. Police announced that one of the entrances had been opened to motor traffic.

Army patrols warned residents through loudspeakers to keep off the streets, saying the rebels had planted roadside bombs which needed to be cleared by the security forces.

Elsewhere, Iraqi soldiers acting on tips from detained Shiite militiamen found 14 bodies that had been buried in a field south of Baghdad , officials said Saturday. It was the second discovery this week of mass graves in the area, raising to 45 the number of bodies located there.

The victims are believed to have been killed more than a year ago as part of a cycle of retaliatory violence between Shiites and Sunnis that has since ebbed.

Recent clashes in the Baghdad area have severely strained a unilateral truce which al-Sadr imposed on the Mahdi Army last August. He ordered the standdown to allow time to reorganize the force and purge criminal factions that had tarnished the image of his movement.

U.S. officials have acknowledged that al-Sadr's truce, along with the Sunni Arab revolt against al-Qaida, had played a major role in reducing American and Iraqi deaths, especially in the Baghdad area.

With renewed Shiite militia fighting, Baghdad is now accounting for a growing number of American casualties.

Last month, 61 percent of the U.S. military deaths occurred in Baghdad , compared with 28 percent in February and 47 percent in April, 2007, according to figures compiled by The Associated Press.

Fighting in Baghdad broke out following last month's ill-prepared Iraqi government offensive against Shiite militias and criminal gangs in the southern city of Basra .

The offensive stalled in the face of fierce resistance by the militias, whose allies in the capital showered rockets and mortars on the U.S.-controlled Green Zone.

Although fighting has eased in Basra , U.S. and Iraqi troops have been pressing militias in Baghdad 's Sadr City to drive them beyond rocket range to the Green Zone.

Associated Press reporter Sameer N. Yacoub in Baghdad and the AP's News Research Center in New York contributed to this report.

Military Personnel Account for 20% of U.S. Suicides

April 10, 2008

by Tom Randall and Rob Waters

Bloomberg

Current and former military personnel accounted for about 20 percent of U.S. suicides in 2005, according to a government study.

About 1,821 current or former soldiers committed suicide in 16 states in 2005, the most recent year of available data, according to the report published today by the U.S. Centers for Disease Control and Prevention. Almost half were diagnosed with depression and a third left suicide notes.

A rise in suicides among soldiers serving in the military has alarmed Pentagon planners and members of Congress as the war in Iraq enters its sixth year. An Army report produced last year found the rate of suicides among soldiers deployed in Iraq from 2003 to 2006 was almost 40 percent higher than the military's average suicide rate. An update of the Army's Mental Health Advisory Team report released in March found suicide rates for soldiers in 2007 remained ``above normal Army rates.''

`The frequency and the length of deployments are stretching people to the limit and they can't tolerate it, Charles Figley, a psychologist who directs the Traumatology Institute at Florida State University , said in a telephone interview today. ``They're taking risks, taking alcohol and taking their own lives because they want to extinguish their pain.

While 38 percent of the soldiers who took their own lives had a diagnosed mental health condition, only 27 percent were receiving mental health care, according to the CDC report.

30,000 Suicides

Each year 30,000 Americans commit suicide, according to the CDC. Suicide is the second-leading cause of death for people ages 25 to 34, after accidental injury, according to today's report, the first from an electronic tracking system meant to help researchers better understand and prevent violent death. The U.S. plans to expand the system to all states, the CDC said.

Suicide accounted for about 56.1 percent of the 15,495 reported violent deaths in the 16 states. Fewer military suicide victims were receiving mental health care than non-military victims, the report said. Violent deaths in the report were caused by intentional use of force or unintended use of a gun.

About three-quarters of all suicides recorded by the CDC took place in a house or apartment. Most victims killed themselves with a gun, followed by poisoning and strangulation, according to the study. About 62 percent had alcohol in their blood.

Men were 3.4 times more likely than women to die violently. American Indians and blacks had the highest rates among ethnicities, the CDC said.

A separate study last year found that combat veterans were twice as likely to take their own lives as people who hadn't been in battle. That study, published in the Journal of Epidemiology and Community Health, looked at 320,000 men who had served in the military from 1917 to 1994.

To contact the reporters on this story: Tom Randall in New York at trandall6@bloomberg.net; Rob Waters in San Francisco at rwaters5@bloomberg.net.

The Collapsing U.S. Economy

You Thought You Had an Equity Line

April 13, 2008

by Gretchen Morgenson

New York Times

It was the nation’s lending institutions and mortgage originators that got us into this credit mess, but it is consumers, taxpayers and those companies’ shareholders who will end up shouldering most of the costs.

The latest example of this is in the mass freezing of home equity lines of credit going on across the country. Reeling from losses on their wretched loan decisions of recent years, lenders are preventing borrowers with pristine credit and significant equity in their homes from tapping into credit lines that they paid dearly to secure.

In the last 30 days, lenders have sent several hundred thousand letters advising borrowers that their home equity lines of credit are frozen, estimated Michael A. Kratzer, president of FeeDisclosure.com, a Web site intended to help consumers reduce fees on home loans.

Major lenders — including Washington Mutual, IndyMac Bank and the Greenpoint Mortgage Unit of Capital One — say that declining property values are prompting the decisions to cut off credit.

Banks have the right, of course, to rescind these credit lines at any time under the terms of the contracts they struck with borrowers. And as home prices have tumbled in many parts of the country, banks are undoubtedly trying to protect themselves from exposure to additional losses.

But these actions are being taken even in areas where property prices are rising, Mr. Kratzer said. What’s worse, the letters provide no explanation for how the lenders determined that the property values underlying the equity lines had fallen.

Frozen home equity lines will surely intensify the consumer spending downturn and put added pressure on an already weak economy. Indeed, on Friday, consumer confidence as measured by the University of Michigan plummeted to its lowest level since 1982. The drop was attributed mostly to higher fuel and food costs, but consumers’ views on their current and expected personal financial situations dropped to their lowest readings since November 1982 and April 1980, respectively.

One especially exasperating aspect of now-you-see-them, now-you-don’t equity lines is that borrowers are not receiving refunds for fees they paid to secure the credit in the first place.

These fees can be significant, Mr. Kratzer said: on a $50,000 line, for example, fees of $1,500 are common. If the line is being frozen at, say, $25,000, why shouldn’t the borrower be entitled to receive a refund of $750?

Borrowers who have an excellent credit score may also find that status hurt when a home equity line is frozen. That is because when a lender suddenly caps a $50,000 line at $25,000, the borrower will appear to have tapped the entire amount of the loan, a factor that can reduce a person’s credit score. Never mind that, based on the original amount of the credit line, the borrower is using only half of it.

Ronald Martin, 31, a United States naval aviator deployed in Iraq , received one of these letters recently from IndyMac Bank. “We regret to inform you that your IndyMac Bank Home Equity account has been temporarily frozen,” the letter began.

Mr. Martin’s wife, Leigh Anne, a substitute teacher who lives in their Camarillo , Calif. , home, said the notice surprised her because she and her husband have excellent credit scores and have not even tapped the IndyMac line. While home values in the Martins’ neighborhood have fallen, the couple are not underwater on their mortgage, which was taken out in spring 2005.

“You paid to use that equity line and now they are saying you can’t use it,” Mrs. Martin said. “We’ve never been late on our mortgage. We have a good savings account. We pay every bill we ever had on time — what did we do wrong?”

The IndyMac letter said the Martins’ credit was being suspended because “the value of the dwelling has declined significantly below its appraised value used at origination.” IndyMac said it would re-evaluate the property value each quarter and, if it improved, the freeze would be lifted.

Officials representing IndyMac declined to comment.

Sara Gaugl, a Washington Mutual spokeswoman, said the bank actively manages the amount of credit it extends to customers. “We have a process in place for customers who wish to appeal a credit line decrease decision,” she said. “We also will continue to assist homeowners who may have unique or special situations.”

Mr. Kratzer, who has recently fielded calls and e-mail messages from more than 500 borrowers in straits similar to the Martins’, said lenders who were reining in credit should provide an explanation of how they determined that property values associated with the lines had declined sharply.

“How are lenders arriving at the new loan-to-value ratios?” Mr. Kratzer asked. “When you secure a loan or home equity line, a full appraisal is generally required. But these processes aren’t being used when the lender calculates a new value to reduce an existing credit line.”

Mr. Kratzer said he had heard from frozen-out borrowers in 11 metropolitan areas where the median home price actually increased in the last quarter of 2007, the most recent figures available from the National Association of Realtors. They include Yakima , Wash. ; Appleton , Wis. ; Raleigh-Cary , N.C. ; and Champaign-Urbana , Ill. Borrowers in areas where prices remained flat have also contacted him.

“Are they applying blanket values to ZIP codes, neighborhoods or entire regions?” Mr. Kratzer said. “We’re all left to wonder about the process.”

Luckily for the Martins, they are not in need of additional credit on their IndyMac line. But other borrowers who have contacted Mr. Kratzer say they are in the middle of home improvement projects that they can no longer finance, or have college tuition bills that they were going to pay using the credit lines. Now they can’t.

Medical expenses, another reason that borrowers tap their equity lines, are also posing problems for some homeowners.

And small-business owners who use home equity lines to bridge cash-flow gaps throughout the year are also being stricken by these curbs, Mr. Kratzer said. He has also heard from people who paid down some of their home equity lines, expecting to be able to draw on them again. Now they are out of luck.

“In a perfect world, lenders would fully disclose the process and criteria used to make these valuations and decisions,” Mr. Kratzer said. “These borrowers have a solid payment history, good credit scores and plenty of equity to satisfy most of the lenders’ loan-to-value formulas. Instead, the banks are just shutting them off.”

China vs. US

The New Chinese E-spionage Threat

April 10, 2008

by Brian Grow, Keith Epstein and Chi-Chu Tschang

BusinessWeek

A BusinessWeek probe of rising attacks on America 's most sensitive computer networks uncovers startling security gaps

The e-mail message addressed to a Booz Allen Hamilton executive was mundane- a shopping list sent over by the Pentagon of weaponry India wanted to buy. But the missive turned out to be a brilliant fake. Lurking beneath the description of aircraft, engines, and radar equipment was an insidious piece of computer code known as "Poison Ivy" designed to suck sensitive data out of the $4 billion consulting firm's computer network.

The Pentagon hadn't sent the e-mail at all. Its origin is unknown, but the message traveled through Korea on its way to Booz Allen. Its authors knew enough about the "sender" and "recipient" to craft a message unlikely to arouse suspicion. Had the Booz Allen executive clicked on the attachment, his every keystroke would have been reported back to a mysterious master at the Internet address cybersyndrome.3322.org, which is registered through an obscure company headquartered on the banks of China 's Yangtze River .

The U.S. government, and its sprawl of defense contractors, have been the victims of an unprecedented rash of similar cyber attacks over the last two years, say current and former U.S. government officials. "It's espionage on a massive scale," says Paul B. Kurtz, a former high-ranking national security official. Government agencies reported 12,986 cyber security incidents to the U.S. Homeland Security Dept. last fiscal year, triple the number from two years earlier. Incursions on the military's networks were up 55% last year, says Lieutenant General Charles E. Croom, head of the Pentagon's Joint Task Force for Global Network Operations. Private targets like Booz Allen are just as vulnerable and pose just as much potential security risk. "They have our information on their networks. They're building our weapon systems. You wouldn't want that in enemy hands," Croom says. Cyber attackers "are not denying, disrupting, or destroying operations-yet. But that doesn’t mean they don’t have the capability.”

A MONSTER

When the deluge began in 2006, officials scurried to come up with software "patches," "wraps," and other bits of triage. The effort got serious last summer when top military brass discreetly summoned the chief executives or their representatives from the 20 largest U.S. defense contractors to the Pentagon for a "threat briefing." BusinessWeek has learned the U.S. government has launched a classified operation called Byzantine Foothold to detect, track, and disarm intrusions on the government's most critical networks. And President George W. Bush on Jan. 8 quietly signed an order known as the Cyber Initiative to overhaul U.S. cyber defenses, at an eventual cost in the tens of billions of dollars, and establishing 12 distinct goals, according to people briefed on its contents. One goal in particular illustrates the urgency and scope of the problem: By June all government agencies must cut the number of communication channels, or ports, through which their networks connect to the Internet from more than 4,000 to fewer than 100. On Apr. 8, Homeland Security Dept. Secretary Michael Chertoff called the President's order a cyber security "Manhattan Project."

But many security experts worry the Internet has become too unwieldy to be tamed. New exploits appear every day, each seemingly more sophisticated than the previous one. The Defense Dept., whose Advanced Research Projects Agency (DARPA) developed the Internet in the 1960s, is beginning to think it created a monster. "You don't need an Army, a Navy, an Air Force to beat the U.S. ," says General William T. Lord, commander of the Air Force Cyber Command, a unit formed in November, 2006, to upgrade Air Force computer defenses. "You can be a peer force for the price of the PC on my desk." Military officials have long believed that "it's cheaper, and we kill stuff faster, when we use the Internet to enable high-tech warfare," says a top adviser to the U.S. military on the overhaul of its computer security strategy. "Now they're saying, Oh, shit.'"

Adding to Washington 's anxiety, current and former U.S. government officials say many of the new attackers are trained professionals backed by foreign governments. "The new breed of threat that has evolved is nation-state-sponsored stuff," says Amit Yoran, a former director of Homeland Security's National Cyber Security Div. Adds one of the nation's most senior military officers: "We've got to figure out how to get at it before our regrets exceed our ability to react."

The military and intelligence communities have alleged that the People's Republic of China is the U.S. 's biggest cyber menace. "In the past year, numerous computer networks around the world, including those owned by the U.S. government, were subject to intrusions that appear to have originated within the PRC," reads the Pentagon's annual report to Congress on Chinese military power, released on Mar. 3. The preamble of Bush's Cyber Initiative focuses attention on China as well.

Wang Baodong, a spokesman for the Chinese government at its embassy in Washington , says "anti-China forces" are behind the allegations. Assertions by U.S. officials and others of cyber intrusions sponsored or encouraged by China are unwarranted, he wrote in an Apr. 9 e-mail response to questions from BusinessWeek. "The Chinese government always opposes and forbids any cyber crimes including hacking' that undermine the security of computer networks," says Wang. China itself, he adds, is a victim, "frequently intruded and attacked by hackers from certain countries."

Because the Web allows digital spies and thieves to mask their identities, conceal their physical locations, and bounce malicious code to and fro, it's frequently impossible to pinpoint specific attackers. Network security professionals call this digital masquerade ball "the attribution problem."

A CREDIBLE MESSAGE

In written responses to questions from BusinessWeek, officials in the office of National Intelligence Director J. Michael McConnell, a leading proponent of boosting government cyber security, would not comment "on specific code-word programs" such as Byzantine Foothold, nor on "specific intrusions or possible victims." But the department says that "computer intrusions have been successful against a wide range of government and corporate networks across the critical infrastructure and defense industrial base." The White House declined to address the contents of the Cyber Initiative, citing its classified nature.

The e-mail aimed at Booz Allen, obtained by BusinessWeek and traced back to an Internet address in China , paints a vivid picture of the alarming new capabilities of America 's cyber enemies. On Sept. 5, 2007 , at 08:22:21 Eastern time, an e-mail message appeared to be sent to John F. "Jack" Mulhern, vice-president for international military assistance programs at Booz Allen. In the high-tech world of weapons sales, Mulhern's specialty, the e-mail looked authentic enough. "Integrate U.S. , Russian, and Indian weapons and avionics," the e-mail noted, describing the Indian government's expectations for its fighter jets. "Source code given to India for indigenous computer upgrade capability." Such lingo could easily be understood by Mulhern. The 62-year-old former U.S. Naval officer and 33-year veteran of Booz Allen's military consulting business is an expert in helping to sell U.S. weapons to foreign governments.

The e-mail was more convincing because of its apparent sender: Stephen J. Moree, a civilian who works for a group that reports to the office of Air Force Secretary Michael W. Wynne. Among its duties, Moree's unit evaluates the security of selling U.S. military aircraft to other countries. There would be little reason to suspect anything seriously amiss in Moree's passing along the highly technical document with "India MRCA Request for Proposal" in the subject line. The Indian government had just released the request a week earlier, on Aug. 28, and the language in the e-mail closely tracked the request. Making the message appear more credible still: It referred to upcoming Air Force communiqués and a "Teaming Meeting" to discuss the deal.

But the missive from Moree to Jack Mulhern was a fake. An analysis of the e-mail's path and attachment, conducted for BusinessWeek by three cyber security specialists, shows it was sent by an unknown attacker, bounced through an Internet address in South Korea , was relayed through a Yahoo! (YHOO) server in New York , and finally made its way toward Mulhern’s Booz Allen in-box. The analysis also shows the code- known as “malware,” for malicious software- tracks keystrokes on the computers of people who open it. A separate program disables security measures such as password protection on Microsoft (MSFT) Access database files, a program often used by large organizations such as the U.S. defense industry to manage big batches of data.

AN E-MAIL'S JOURNEY

While hardly the most sophisticated technique used by electronic thieves these days, "if you have any kind of sensitive documents on Access databases, this code is getting in there and getting them out," says a senior executive at a leading cyber security firm that analyzed the e-mail. (The person requested anonymity because his firm provides security consulting to U.S. military departments, defense contractors, and financial institutions.) Commercial computer security firms have dubbed the malicious code "Poison Ivy."

But the malware attached to the fake Air Force e-mail has a more devious- and worrisome- capability. Known as a remote administration tool, or RAT, it gives the attacker control over the "host" PC, capturing screen shots and perusing files. It lurks in the background of Microsoft Internet Explorer browsers while users surf the Web. Then it phones home to its "master" at an Internet address currently registered under the name cybersyndrome.3322.org.

The digital trail to cybersyndrome.3322.org, followed by analysts at BusinessWeek's request, leads to one of China 's largest free domain-name-registration and e-mail services. Called 3322.org, it is registered to a company called Bentium in the city of Changzhou , an industry hub outside Shanghai . A range of security experts say that 3322.org provides names for computers and servers that act as the command and control centers for more than 10,000 pieces of malicious code launched at government and corporate networks in recent years. Many of those PCs are in China ; the rest could be anywhere.

The founder of 3322.org, a 37-year-old technology entrepreneur named Peng Yong, says his company merely allows users to register domain names. "As for what our users do, we cannot completely control it," says Peng. The bottom line: If Poison Ivy infected Jack Mulhern's computer at Booz Allen, any secrets inside could be seen in China . And if it spread to other computers, as malware often does, the infection opens windows on potentially sensitive information there, too.

It's not clear whether Mulhern received the e-mail, but the address was accurate. Informed by BusinessWeek on Mar. 20 of the fake message, Booz Allen spokesman George Farrar says the company launched a search to find it. As of Apr. 9, says Farrar, the company had not discovered the e-mail or Poison Ivy in Booz Allen's networks. Farrar says Booz Allen computer security executives examined the PCs of Mulhern and an assistant who received his e-mail. "We take this very seriously," says Farrar. (Mulhern, who retired in March, did not respond to e-mailed requests for comment and declined a request, through Booz Allen, for an interview.)

Air Force officials referred requests for comment to U.S. Defense Secretary Robert M. Gates' office. In an e-mailed response to BusinessWeek, Gates' office acknowledges being the target of cyber attacks from "a variety of state and non-state-sponsored organizations to gain unauthorized access to, or otherwise degrade, Defense Dept. information systems." But the Pentagon declined to discuss the attempted Booz Allen break-in. The Air Force, meanwhile, would not make Stephen Moree available for comment.

The bogus e-mail, however, seemed to cause a stir inside the Air Force, correspondence reviewed by BusinessWeek shows. On Sept. 4, defense analyst James Mulvenon also received the message with Moree and Mulhern's names on it. Security experts believe Mulvenon's e-mail address was secretly included in the "blind copy" line of a version of the message. Mulvenon is director of the Center for Intelligence Research & Analysis and a leading consultant to U.S. defense and intelligence agencies on China 's military and cyber strategy. He maintains an Excel spreadsheet of suspect e-mails, malicious code, and hacker groups and passes them along to the authorities. Suspicious of the note when he received it, Mulvenon replied to Moree the next day. Was the e-mail " India spam?" Mulvenon asked.

"I apologize—this e-mail was sent in error—please delete," Moree responded a few hours later.

"No worries," typed Mulvenon. "I have been getting a lot of trojaned Access databases from China lately and just wanted to make sure."

“Interesting- our network folks are looking into some kind of malicious intent behind this e-mail snafu,”wrote Moree. Neither the Air Force nor the Defense Dept. would confirm to BusinessWeek whether an investigation was conducted. A Pentagon spokesman says that its procedure is to refer attacks to law enforcement or counterintelligence agencies. He would not disclose which, if any, is investigating the Air Force e-mail.

DIGITAL INTRUDERS

By itself, the bid to steal digital secrets from Booz Allen might be deeply troubling. But Poison Ivy is part of a new type of digital intruder rendering traditional defenses-firewalls and updated antivirus softwear – virtually useless. Sophisticated hackers, say Pentagon officials, are developing new ways to creep into computer networks sometimes before those vulnerabilities are known. "The offense has a big advantage over the defense right now," says Colonel Ward E. Heinke, director of the Air Force Network Operations Center at Barksdale Air Force Base. Only 11 of the top 34 antivirus software programs identified Poison Ivy when it was first tested on behalf of BusinessWeek in February. Malware-sniffing software from several top security firms found "no virus" in the India fighter-jet e-mail, the analysis showed.

Over the past two years thousands of highly customized e-mails akin to Stephen Moree's have landed in the laptops and PCs of U.S. government workers and defense contracting executives. According to sources familiar with the matter, the attacks targeted sensitive information on the networks of at least seven agencies- the Defense, State, Energy, Commerce, Health & Human Services, Agriculture, and Treasury departments- and also defense contractors Boeing (BA), Lockheed Martin, General Electric (GE),

Raytheon (RTW), and General Dynamics (GD), say current and former government network security experts. Laura Keehner, a spokeswoman for the Homeland Security Dept., which coordinates protection of government computers, declined to comment on specific intrusions. In written responses to questions from BusinessWeek, Keehner says: "We are aware of and have defended against malicious cyber activity directed at the U.S. Government over the past few years. We take these threats seriously and continue to remain concerned that this activity is growing more sophisticated, more targeted, and more prevalent." Spokesmen for Lockheed Martin, Boeing, Raytheon, General Dynamics, and General Electric declined to comment. Several cited policies of not discussing security-related matters.

The rash of computer infections is the subject of Byzantine Foothold, the classified operation designed to root out the perpetrators and protect systems in the future, according to three people familiar with the matter. In some cases, the government’s own cyber security experts are engaged in “hack backs” - following the malicious code to peer into the hackers' own computer systems. BusinessWeek has learned that a classified document called an intelligence community assessment, or ICA , details the Byzantine intrusions and assigns each a unique Byzantine-related name. The ICA has circulated in recent months among selected officials at U.S. intelligence agencies, the Pentagon, and cyber security consultants acting as outside reviewers. Until December, details of the ICA 's contents had not even been shared with congressional intelligence committees.

Now, Senate Intelligence Committee Chairman John D. Rockefeller (D-W. Va. ) is said to be discreetly informing fellow senators of the Byzantine operation, in part to win their support for needed appropriations, many of which are part of classified "black" budgets kept off official government books. Rockefeller declined to comment. In January a Senate Intelligence Committee staffer urged his boss, Missouri Republican Christopher "Kit" Bond, the committee's vice-chairman, to supplement closed-door testimony and classified documents with a viewing of the movie Die Hard 4 on a flight the senator made to New Zealand . In the film, cyber terrorists breach FBI networks, purloin financial data, and bring car traffic to a halt in Washington . Hollywood , says Bond, doesn't exaggerate as much as people might think. "I can't discuss classified matters," he cautions. "But the movie illustrates the potential impact of a cyber conflict. Except for a few things, let me just tell you: It's credible."

"Phishing," one technique used in many attacks, allows cyber spies to steal information by posing as a trustworthy entity in an online communication. The term was coined in the mid-1990s when hackers began "fishing" for information (and tweaked the spelling). The e-mail attacks on government agencies and defense contractors, called "spear-phish" because they target specific individuals, are the Web version of laser-guided missiles. Spear-phish creators gather information about people's jobs and social networks, often from publicly available information and data stolen from other infected computers, and then trick them into opening an e-mail.

DEVIOUS SCRIPT

Spear-phish tap into a cyber espionage tactic that security experts call "Net reconnaissance." In the attempted attack on Booz Allen, attackers had plenty of information about Moree: his full name, title (Northeast Asia Branch Chief), job responsibilities, and e-mail address. Net reconnaissance can be surprisingly simple, often starting with a Google (GOOG) search. (A lookup of the Air Force's Pentagon e-mail address on Apr. 9, for instance, retrieved 8,680 e-mail addresses for current or former Air Force personnel and departments.) The information is woven into a fake e-mail with a link to an infected Web site or containing an attached document. All attackers have to do is hit their send button. Once the e-mail is opened, intruders are automatically ushered inside the walled perimeter of computer networks- and malicious codes such as Poison Ivy can take over.

By mid-2007 analysts at the National Security Agency began to discern a pattern: personalized e-mails with corrupted attachments such as PowerPoint presentations, Word documents, and Access database files had been turning up on computers connected to the networks of numerous agencies and defense contractors.

A previously undisclosed breach in the autumn of 2005 at the American Enterprise Institute—a conservative think tank whose former officials and corporate executive board members are closely connected to the Bush Administration—proved so nettlesome that the White House shut off aides' access to the Web site for more than six months, says a cyber security specialist familiar with the incident. The Defense Dept. shut the door for even longer. Computer security investigators, one of whom spoke with BusinessWeek, identified the culprit: a few lines of Java script buried in AEI's home page, www.aei.org, that activated as soon as someone visited the site. The script secretly redirected the user's computer to another server that attempted to load malware. The malware, in turn, sent information from the visitor's hard drive to a server in China . But the security specialist says cyber sleuths couldn't get rid of the intruder.

After each deletion, the furtive code would reappear. AEI says otherwise—except for a brief accidental recurrence caused by its own network personnel in August, 2007, the devious Java script did not return and was not difficult to eradicate.

The government has yet to disclose the breaches related to Byzantine Foothold. BusinessWeek has learned that intruders managed to worm into the State Dept.'s highly sensitive Bureau of Intelligence & Research, a key channel between the work of intelligence agencies and the rest of the government. The breach posed a risk to CIA operatives in embassies around the globe, say several network security specialists familiar with the effort to cope with what became seen as an internal crisis. Teams worked around-the-clock in search of malware, they say, calling the White House regularly with updates.

The attack began in May, 2006, when an unwitting employee in the State Dept.'s East Asia Pacific region clicked on an attachment in a seemingly authentic e-mail. Malicious code was embedded in the Word document, a congressional speech, and opened a Trojan "back door" for the code's creators to peer inside the State Dept.'s innermost networks. Soon, cyber security engineers began spotting more intrusions in State Dept. computers across the globe. The malware took advantage of previously unknown vulnerabilities in the Microsoft operating system. Unable to develop a patch quickly enough, engineers watched helplessly as streams of State Dept. data slipped through the back door and into the Internet ether. Although they were unable to fix the vulnerability, specialists came up with a temporary scheme to block further infections. They also yanked connections to the Internet.

One member of the emergency team summoned to the scene recalls that each time cyber security professionals thought they had eliminated the source of a "beacon" reporting back to its master, another popped up. He compared the effort to the arcade game Whack-A-Mole. The State Dept. says it eradicated the infection, but only after sanitizing scores of infected computers and servers and changing passwords. Microsoft's own patch, meanwhile, was not deployed until August, 2006, three months after the infection. A Microsoft spokeswoman declined to comment on the episode, but said: "Microsoft has, for several years, taken a comprehensive approach to help protect people online."

There is little doubt among senior U.S. officials about where the trail of the recent wave of attacks leads. "The Byzantine series tracks back to China ," says Air Force Colonel Heinke. More than a dozen current and former U.S. military, cyber security, and intelligence officials interviewed by BusinessWeek say China is the biggest emerging adversary- and not just clubs of rogue or enterprising hackers who happen to be Chinese. O. Sami Saydjari, a former National Security Agency executive and now president of computer security firm Cyber Defense Agency, says the Chinese People's Liberation Army, one of the world's largest military forces, with an annual budget of $57 billion, has "tens of thousands" of trainees launching attacks on U.S. computer networks. Those figures could not be independently confirmed by BusinessWeek. Other experts provide lower estimates and note that even one hacker can do a lot of damage. Says Saydjari: "We have to look at this as equivalent to the launch of a Chinese Sputnik." China vigorously disputes the spying allegation and says its military posture is purely defensive.

Hints of the perils perceived within America 's corridors of power have been slipping out in recent months. In Feb. 27 testimony before the U.S. Senate Armed Services Committee, National Intelligence Director McConnell echoed the view that the threat comes from China . He told Congress he worries less about people capturing information than altering it. "If someone has the ability to enter information in systems, they can destroy data. And the destroyed data could be something like money supply, electric-power distribution, transportation sequencing, and that sort of thing." His conclusion: "The federal government is not well-protected and the private sector is not well-protected."

Worries about China-sponsored Internet attacks spread last year to Germany , France , and Britain . British domestic intelligence agency MI5 had seen enough evidence of intrusion and theft of corporate secrets by allegedly state-sponsored Chinese hackers by November, 2007, that the agency's director general, Jonathan Evans, sent an unusual letter of warning to 300 corporations, accounting firms, and law firms- and a list of network security specialists to help block computer intrusions. Some recipients of the MI5 letter hired Peter Yapp, a leading security consultant with London-based Control Risks. "People treat this like it's just another hacker story, and it is almost unbelievable," says Yapp. "There's a James Bond element to it. Too many people think, It's not going to happen to me.' But it has."

Identifying the thieves slipping their malware through the digital gates can be tricky. Some computer security specialists doubt China 's government is involved in cyber attacks on U.S. defense targets. Peter Sommer, an information systems security specialist at the London School of Economics who helps companies secure networks, says: "I suspect if it's an official part of the Chinese government, you wouldn't be spotting it."

A range of attacks in the past two years on U.S. and foreign government entities, defense contractors, and corporate networks have been traced to Internet addresses registered through Chinese domain name services such as 3322.org, run by Peng Yong. In late March, BusinessWeek interviewed Peng in an apartment on the 14th floor of the gray-tiled residential building that houses the five-person office for 3322.org in Changzhou . Peng says he started 3322.org in 2001 with $14,000 of his own money so the growing ranks of China 's Net surfers could register Web sites and distribute data. "We felt that this business would be very popular, especially as broadband, fiber-optic cables, data transmission technology ADSL, these ways of getting on the Internet took off," says Peng (translated by BusinessWeek from Mandarin), who drives a black Lexus IS300 bought last year.

His 3322.org has indeed become a hit. Peng says the service has registered more than 1 million domain names, charging $14 per year for "top-level" names ending in .com, .org, or .net. But cyber security experts and the Homeland Security Dept.'s U.S. Computer Emergency Readiness Team (CERT) say that 3322.org is a hit with another group: hackers. That's because 3322.org and five sister sites controlled by Peng are dynamic DNS providers. Like an Internet phone book, dynamic DNS assigns names for the digits that mark a computer's location on the Web. For example, 3322.org is the registrar for the name cybersyndrome.3322.org at Internet address 61.234.4.28, the China-based computer that was contacted by the malicious code in the attempted Booz Allen attack, according to analyses reviewed by BusinessWeek. "Hackers started using sites like 3322.org so that the malware phones home to the specific name. The reason? It is relatively difficult to have Internet addresses taken down in China ," says Maarten van Horenbeeck, a Belgium-based intrusion analyst for the SANS Internet Storm Center, a cyber threat monitoring group.

TARGET: PRIVATE SECTOR

Peng's 3322.org and sister sites have become a source of concern to the U.S. government and private firms. Cyber security firm Team Cymru sent a confidential report, reviewed by BusinessWeek, to clients on Mar. 7 that illustrates how 3322.org has enabled many recent attacks. In early March, the report says, Team Cymru received "a spoofed e-mail message from a U.S. military entity, and the PowerPoint attachment had a malware widget embedded in it." The e-mail was a spear-phish. The computer that controlled the malicious code in the PowerPoint? Cybersyndrome ,3322.org- the same China-registered computer in the attempted attack on Booz Allen. Although the cybersyndrome Internet address may not be located in China , the top five computers communicating directly with it were- and four were registered with a large state-owned Internet service provider, according to the report.

A person familiar with Team Cymru's research says the company has 10,710 distinct malware samples that communicate to masters registered through 3322.org. Other groups reporting attacks from computers hosted by 3322.org include activist group Students for a Free Tibet, the European Parliament, and U.S. Bancorp (USB), according to security reports. Team Cymru declined to comment. The U.S. government has pinpointed Peng's services as a problem, too. In a Nov. 28, 2007 , confidential report from Homeland Security's U.S. CERT obtained by BusinessWeek,

"Cyber Incidents Suspected of Impacting Private Sector Networks," the federal cyber watchdog warned U.S. corporate information technology staff to update security software to block Internet traffic from a dozen Web addresses after spear-phishing attacks. "The level of sophistication and scope of these cyber security incidents indicates they are coordinated and targeted at private-sector systems," says the report. Among the sites named: Peng's 3322.org, as well as his 8800.org, 9966.org, and 8866.org. Homeland Security and U.S. CERT declined to discuss the report.

Peng says he has no idea hackers are using his service to send and control malicious code. "Are there a lot?" he says when asked why so many hackers use 3322.org. He says his business is not responsible for cyber attacks on U.S. computers. "It's like we have paved a road and what sort of car users drive on it is their own business," says Peng, who adds that he spends most of his time these days developing Internet telephony for his new software firm, Bitcomm Software Tech Co. Peng says he was not aware that several of his Web sites and Internet addresses registered through them were named in the U.S. CERT report. On Apr. 7, he said he planned to shut the sites down and contact the U.S. agency. Asked by BusinessWeek to check his database for the person who registered the computer at the domain name cybersyndrome.3322.org, Peng says it is registered to Gansu Railway Communications, a regional telecom subsidiary of China 's Railways Ministry. Peng declined to provide the name of the registrant, citing a confidentiality agreement. "You can go through the police to find out the user information," says Peng.

U.S. cyber security experts say it's doubtful that the Chinese government would allow the high volume of attacks on U.S. entities from China-based computers if it didn't want them to happen. " China has one of the best-controlled Internets in the world. Anything that happens on their Internet requires permission," says Cyber Defense Group's Saydjari. The Chinese government spokesman declined to answer specific questions from BusinessWeek about 3322.org.

But Peng says he can do little if hackers exploit his goodwill- and there hasn’t been much incentive from the Chinese government for him to get tough. "Normally, we take care of these problems by shutting them down," says Peng. "Because our laws do not have an extremely clear method to handle this problem, sometimes we are helpless to stop their services." And so, it seems thus far, is the U.S. government.

Grow is a correspondent in BusinessWeek's Atlanta bureau . Epstein is a correspondent in BusinessWeek's Washington bureau. Tschang is a correspondent in BusinessWeek's Beijing bureau.

US candidates ride the China bogey

April 12, 2008

by Dmitry Shlapentokh

Asia Times

In the recent in the speeches of some candidates in the United States presidential campaign, China emerged in a way almost as the replacement of the USSR of the old days.

It became the dreadful "evil empire", the major enemy of the US in the long run. Still, there is a difference. While the USSR had threatened the US with its missiles, China poses a threat by its huge reserves of US dollars.

Elaborating on this threat, Senator Hillary Clinton provided a scenario in which China could hamper the US 's foreign policy. She presented the hypothetical picture of China invading Taiwan and the US contemplating moving its fleet to protect the island. Atthe same time, China would threaten to dump its huge holdings of US dollars and thereby wreck the US economy. And this, Clinton stated, might, indeed, prevent the US from acting as it should.

Clinton was not wrong, not just in elaborating on a possible scenario but in another important aspect: in the present world, economic power - in the case of China , a huge currency reserve could indeed be used as a direct weapon. And Clinton 's call to stop this situation is pretty much justifiable. However, the point is that she provided no concrete plan on how to do this. She provided no plan on how the US would end the flow of dollars abroad and no plan on how the dollars already in the hands of foreign powers could be brought back to the US without damaging the American economy.

The continuing US trade deficit with China is one of the major reasons for the continuous flow of dollars out of the country; and here the inefficiency of the US economy is a key. These statements could well be challenged; and those who point to the low cost of Chinese goods vis a vis US goods usually underscore the lower cost of Chinese labor.

This argument does not hold, and some historical examples could well illustrate this point. Nineteenth-century British workers definitely did not live well. Still, the wages of Indian workers were much lower than in UK and the cost of shipping cloth to India by sailing ships was expensive and time-consuming. Yet, as Marx stated, the plains of India "became white with the bones of the starving Indian weavers" who could not compete with British goods. If the situation with US goods is different than it was for the British, it is not because of the cheapness of Chinese labor but because of the basic inefficiency of the US ’s social and economic arrangements. There are a variety of manifestations of this inefficiency.

Of prime significance are the layers of often absolutely useless but lavishly paid bureaucracy that are often seen as the way of "improvement". Their stress is on advertising, on the way to sell things - from goods to education - not on actually improving the products. In fact advertising, financial speculation and similar activities themselves become not just a "product" but the major "products" of the US economy, duly recorded by statistics that for years have boasted about the "high" economic growth of the US. This was already the case during Bill Clinton's presidency, the golden era to which Hillary Clinton appeals.

It is the arrangement of insurance companies, doctors and the drug industry that makes the American medical service not just of dubious quality but extremely expensive. It is also the arrangement of US education, in particular of higher education, where the escalating cost has not led to visible improvement in teaching and research; in fact, quite a few Americans receive payment for supposed research without publishing for years.

All of these arrangements make US goods and services (such as education) not just extremely expensive but of dubious quality. The recent purchase of planes by the US Department of Defense, not from Boeing but from a European firm, is telling. The Pentagon clearly understands that giving preference to foreign firms for the major purchase of high-tech equipment would lead to public outcry and that the dollar-euro ratio would make the purchase prohibitively expensive.

Still, the purchase was made, indicating that overall quality is so high that it overrode all other considerations. It is inconceivable to assume that with such a low quality of overall products and their high cost, the US could avoid trade difficulties and increasing reliance on foreign loans.

Moreover, the US could hardly induce foreign governments to reduce their holdings of US currency without much damage to US dollars. Indeed, even if the US would reduce its borrowing, it still would be influenced by huge numbers of dollars in the hands of foreign governments, so called "sovereign funds".

To start with, the US needs to induce the foreign holders of dollars to buy US products. Buying US products would keep the value of the dollar higher and would prevent foreign buyers from accumulating too much US currency. Still, the US usually could offer little to foreign buyers, outside of a few strategically important US corporations or companies still attractive to China - the major holder of US dollars - and other non-friendly governments. Yet the US government makes it hard for China to buy them.

The logic here is simple: control over the major "command highs" of the American economy would increasingly lead to economic and then political control over the US by foreign entities. In fact, in the past, the US and other Western powers did precisely that in the Third World : control formally independent governments through control over the nation's economy. This was often called "neo-colonialism".

The US still could extricate itself from a "neo-colonialist" or decaying scenario; but this would require such a dramatic intervention of the state in its social and economic fabric that it would entail something similar to the "New Deal", which, at close inspection, is quite similar to what was done in Nazi Germany or fascist Italy .

This alternative hardly pleases the majority of the US electorate. And this is the reason why both Clinton and Barack Obama, with all of their rhetoric, avoid naming the problems - the inefficiency of the entire system and the structural similarities in the economic performance of all segments of society - and pointing to tough medicine. They still, as Clinton 's speech so indicated, prefer to talk tough but be "quite responsible" in action. Until, of course, the acute economic and social pain will compel the leader - whoever he or she may be or what philosophy he or she would preach - to walk the walk.

Dmitry Shlapentokh, PhD, is associate professor of history, College of Liberal Arts and Sciences, Indiana University South Bend . He is author of East Against West: The First Encounter - The Life of Themistocles, 2005.

Tibet

Chinese president says Tibet ‘not human rights issue’

April 12, 2008

AFP

BOAO, China (AFP) - - Chinese President Hu Jintao Saturday defended the Tibet crackdown and said the problem was a separatist issue and not related to human rights.

"Our conflict with the Dalai clique is not an ethnic problem, not a religious problem, nor a human rights problem," Hu told visiting Australian Prime Minister Kevin Rudd, according to Xinhua news agency.

"It is a problem either to safeguard national unification or to split the motherland," Hu said.

Hu was speaking after a clampdown on protests which began last month left about 150 people dead, according to exiled to Tibetan leaders. China says Tibetan "rioters" killed 18 civilians and two policemen.

"No responsible government will sit idle for such crimes, which gravely encroach human rights, gravely disrupt social order and gravely jeopardize the life and property security of the masses," Hu said.

The rare unrest has thrown an unwelcome spotlight on China ahead of this year's Beijing Olympics with protesters disrupting the European and US legs of the ceremonial torch relay this week.

China 's communist rulers vehemently deny they are responsible for religious and cultural repression in Tibet , and insist their control of the remote region has benefited its devoutly Buddhist people.

Don’t Know Much About Tibetan History?

April 13, 2008

by Elliot Sperling

New York Times

For many Tibetans, the case for the historical independence of their land is unequivocal. They assert that Tibet has always been and by rights now ought to be an independent country. China ’s assertions are equally unequivocal: Tibet became a part of China during Mongol rule and its status as a part of China has never changed. Both of these assertions are at odds with Tibet ’s history.

The Tibetan view holds that Tibet was never subject to foreign rule after it emerged in the mid-seventh century as a dynamic power holding sway over an Inner Asian empire. These Tibetans say the appearance of subjugation to the Mongol rulers of the Yuan Dynasty in the 13th and 14th centuries, and to the Manchu rulers of China’s Qing Dynasty from the 18th century until the 20th century, is due to a modern, largely Western misunderstanding of the personal relations among the Yuan and Qing emperors and the pre-eminent lamas of Tibet. In this view, the lamas simply served as spiritual mentors to the emperors, with no compromise of Tibet ’s independent status.

In China ’s view, the Western misunderstandings are about the nature of China : Western critics don’t understand that China has a history of thousands of years as a unified multinational state; all of its nationalities are Chinese. The Mongols, who entered China as conquerers, are claimed as Chinese, and their subjugation of Tibet is claimed as a Chinese subjugation.

Here are the facts. The claim that Tibet entertained only personal relations with China at the leadership level is easily rebutted. Administrative records and dynastic histories outline the governing structures of Mongol and Manchu rule. These make it clear that Tibet was subject to rules, laws and decisions made by the Yuan and Qing rulers. Tibet was not independent during these two periods. One of the Tibetan cabinet ministers summoned to Beijing at the end of the 18th century describes himself unambiguously in his memoirs as a subject of the Manchu emperor.

But although Tibet did submit to the Mongol and Manchu Empires, neither attached Tibet to China . The same documentary record that shows Tibetan subjugation to the Mongols and Manchus also shows that China ’s intervening Ming Dynasty (which ruled from 1368 to 1644) had no control over Tibet . This is problematic, given China ’s insistence that Chinese sovereignty was exercised in an unbroken line from the 13th century onward.

The idea that Tibet became part of China in the 13th century is a very recent construction. In the early part of the 20th century, Chinese writers generally dated the annexation of Tibet to the 18th century. They described Tibet ’s status under the Qing with a term that designates a “feudal dependency,” not an integral part of a country. And that’s because Tibet was ruled as such, within the empires of the Mongols and the Manchus. When the Qing dynasty collapsed in 1911, Tibet became independent once more.

From 1912 until the founding of the People’s Republic of China in 1949, no Chinese government exercised control over what is today China ’s Tibet Autonomous Region. The Dalai Lama’s government alone ruled the land until 1951.

Marxist China adopted the linguistic sleight of hand that asserts it has always been a unitary multinational country, not the hub of empires. There is now firm insistence that “Han,” actually one of several ethnonyms for “Chinese,” refers to only one of the Chinese nationalities. This was a conscious decision of those who constructed 20th-century Chinese identity. (It stands in contrast to the Russian decision to use a political term, “Soviet,” for the peoples of the Union of Soviet Socialist Republics .)

There is something less to the arguments of both sides, but the argument on the Chinese side is weaker. Tibet was not “Chinese” until Mao Zedong’s armies marched in and made it so.

Elliot Sperling is the director of the Tibetan Studies program at Indiana University ’s department of Central Eurasia Studies.