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U.S. Cyber Consequences Unit director Scott Borg breaks down the economics of the cyber attacks.
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Well today -- examining beyond the economics of the cyber threaten the now well I'm no immediate report that came out alleging that a branch of the Chinese military hacked into 150 US company stealing a massive -- -- sensitive.
Company information so we have Scott board with us leading expert on the cyber attacks directed and chief economist the US cyber consequences unit and its good to talk -- series -- You know it's interesting because we hear of armed Iran and we talked yesterday about Russia -- talked about lone wolf.
Cyber attacks and all these other things but it seems many times to come back.
To China why is China perceived as being much more important than other places in this discussion.
China is carrying out about ten times the scale of economic espionage -- the whole rest of the world put together well.
And when China steel's business secrets and technology it matters a lot more than if a country like say France or Japan does.
France is the same economic technological level we are with the same cost China's not when -- steal secrets they can be stealing an entire industry.
They do it.
It is wow that's quite a when you think about what China does well.
Everything comes back to scale there's so much of everything in China and as you're saying here there's so much theft mean ten times more than any.
A place else I am curious -- read about it the more I think about and what the motives of the Chinese aren't -- some of the more obvious but at the same time.
If China for example hurts us with the -- us being United States for the cyber attack isn't it in effect -- itself in some ways as well economically are now.
China needs to maintain an extraordinary economic growth rate in -- to.
He convinces citizens to put up with the oppressive regime.
So they've been managing a growth rate about four times the rate of a developed country like the United States.
In order to maintain that extraordinarily high growth rate they have.
They have to copy western technologies.
-- only way they can get those technologies unless we hand them to them is to steal them.
So stealing western technologies and business secrets is part of the economic development strategy for the country of China.
Because it goes back to the earlier point which I.
Left out one exception to the rule but I.
-- over is that there's.
A lot of everything in China that the scale is that the Chinese advantage is a lot of everything except you would argue or a lot of people -- innovation there's not as much of that there are serious.
Here in the United States -- and other places so your point is that they try to steal that.
And they do that with side -- espionage cyber attacks and what have you so then how do we respond to that because.
Once again we in the United States or -- the American corporations certainly want to have a productive relationship with the Chinese its its lucrative already potentially more lucrative.
For years to -- -- how we respond to that is it just all out.
-- tit for tat would go right at the more -- to be very very careful.
The point about innovation humiliated it's actually really important and that's the basis for this.
The reason that China's theft of information is so bad for the global economy.
Is that it's taking resources away from people who know a lot of innovate.
And handing them to people who don't know how to innovate.
Ancient China knew how to innovate modern China doesn't.
Every year United States and Western Europe produce many major technological innovations.
Things like -- sisters and computers the Internet Smartphones.
In modern times China has produced only one technological innovation that I'm aware of the electronic cigarette.
That's not what you know solo I wanna hang your hat on now is that if you're at -- through the Chinese.
Scott -- for today and -- pick up this discussion on how the US response now everybody else response down the line but for today thank you very much for coming on appreciate it.
