The United States is Losing the Spy Wars

Spare a thought for American spooks – their job category appears highly imperiled right now. At risk are perhaps less the jobs of US intelligence “field agents,” but rather the National Security Agency tech spies who make a living monitoring all manner of electronic data. With China’s spurt ahead in 5G communications, and its accompanying quantum cryptography, a great many Western intelligence functions are at least stifled, if not over for good.

Also, if the warnings around the happy commercial relationship between American corporates and Chinese manufacturing are going to come home to roost, the 5G implications for US spies might be the most telling resting place. Perhaps more than merely being spied upon themselves, the US intelligence community is alarmed by the lead China has opened in 5G mobile broadband. It bluntly implies the dysfunction of hundreds of thousands of government surveillance jobs that assume a level playing field. While tech wars typically play out between nations largely tweaking shared systems, looking for an edge, China “owning” the 5G rollout creates a different scenario.

Where those US tax dollars now go

In a messy repeating cycle often caricatured in Hollywood movies, government agencies in America are allocated their funds based on the previous year’s spending. In there too is the commonsense of business planning and budgeting, but also a huge amount of self-justification. American government agencies all vie for a slice of the next budget. Being able to spend half a billion dollars in a year, for example, builds a solid case for a department to claim another half billion allocation next year, and maybe more. The US’ intelligence gathering community consumes over $80 billion per annum. Of this amount, almost all goes to the National Intelligence Program and the Military Intelligence Program. Electronic eavesdropping, for want of a better term, takes up most of that $80 billion. With China now in the lead on 5G, that kind of surveillance hasn’t simply become more challenging, it’s going to be impossible in the very near future.

US spy agencies now not only face allocation cuts, they will also face existential questions around why such constant monitoring should be in place when 5G is taking over. More accurately, how such surveillance will happen, when Asia has all the boxes ticked on 5G. The phenomenon of quantum cryptography is at the heart of the dilemma. The pioneers in the field, the Chinese, are way ahead with the employment of unbreakable data locks. A vastly enhanced security layer is enacted with 5G. Generated by computers, to computers, as the quantum nature of encryption on the network becomes reality, it will mean traditional “hacking-in” isn’t going to work anymore.

Computers will be encrypting data on 5G, which is bad news for humans who are used to previously being able to “get around” security protocols to view or steal data. Indeed, while there are other specific issues with Chinese Huawei’s rollout in Europe and America, the fundamental construct of 5G is the issue for US surveillance, as the intelligence agencies know that they’ll be locked out of 5G. Having Huawei at the head of its global rollout is just salt in the wound for US intelligence. 

Google has also recently limited Huawei’s access to Android updates, beyond that which is available in the public record. Such toeing of the local line by large American tech corporations seem destined only to accelerate a Chinese hegemony. Huawei has indicated it intends bringing its own Android-rival platform off the drawing board and into application. In keeping with the current trade wars – as well as spurred by fears of spying China outdoing America technically – the US is caught in a moment of defeat. 

Consummately sure of its position in the world and now also visibly ahead with tech, China and its major corporations are not about to bow to empty threats from any quarter. With a home market of over a billion people, Chinese tech firms also have a massive cushion, untouchable by outside interests.

A many-headed 5G dilemma

US senators are confusing 5G with the company Huawei, although that’s understandable. Donald Trump doesn’t like Huawei, he doesn’t like China, and no one but Beijing likes the fact that China is on the top rung of 5G going into a fast-paced future. For its part, as the 5G boss of the world, Huawei has rendered much of its tech open-source, playing open cards to reassure other nations of their benign, strictly commercial intentions.

The NSA’s previous ability to listen in on world leaders and foreign threats alike proved enormously valuable to American interests. And its practitioners too have swelled in number over the last decade. All of that might now come to a grinding halt. With a direct correlation between its value of intel and its annual funding, American intelligence faces the real prospect of shedding a large amount of practices, staff and, ultimately, value.

No doubt this is not the endgame. However, few futurists will venture suggestions as to how 5G encrypted broadband might one day become “obsolete” enough to suffer traditional hacking. The US’ current refrain is that 5G in the hands of Huawei might allow the construction of secret access ports that will compromise communicated data. Such architecture would also allow China to debilitate the US in a moment of conflict – unthinkable to Washington hawks. Ever the Asian oddball, to date, only Japan has acceded to US demands that countries block Huawei’s attempts to really establish abroad.

In the end, money will talk

There remains little doubt by investors and commentators that Huawei’s ambitious plans won’t be thwarted. Huawei is noting other countries’ reticence to yield to American demands. It already has a green light in Europe. And, in the final analysis, it will offer spin-offs, benefits, and a costing structure hard to decline, in order to network the globe.

As for US intelligence, they now live in a world where there’s more than one communication technology in play. That makes the level playing field of the past a sad reminiscence, as now eavesdropping will become largely impossible.

With quantum communication, the very system that makes data transfer possible, can’t be stolen. Any third party interference destroys the very signal they’re trying to capture. Two years ago, Chinese scientists placed a video call to colleagues in Vienna. That signal was created by employing atoms halfway across the planet. Quantum communication has been a physics application largely developed by China, and now the moment of rollout is upon the world. 

It’s not entirely clear how particularly America has been caught with their pants down this time, as they must have seen this coming.

Whatever the US response to the game changing might be, it spells bad news for every intelligence gathering US spy. It’s likely that a massive layoff is inevitable over the next few years. That said, the senate is always loathe to stop spending the taxpayer’s money, and might yet redirect current funding into alternative spy pursuits. Likely to be top priorities among them – how to hack 5G, and how to catch up with and defeat China in the tech space.