In speech to CEOs, Obama threatens China with retaliation over hacking

Gregory Korte | USA TODAY

WASHINGTON — President Obama did some cyber saber-rattling with China Wednesday, saying that the United States "is prepared to take some countervailing measures to get their attention."

And in a speech to the Business Roundtable, Obama suggested that he views industrial espionage to be an even more significant provocation than Chinese attempts to hack the White House itself.

"We have repeatedly said to the Chinese government that we understand traditional intelligence-gathering functions that all states, including us, engage in," Obama told the quarterly gathering of CEOs. "That is fundamentally different from your government or its proxies engaging directly in industrial espionage and stealing trade secrets, stealing proprietary information from companies. That we consider an act of aggression that has to stop."

China is suspected in an increasing number computer hacking incidents over the past year, including White House email systems, a database of federal employees and security clearances, and major American companies.

Obama's comments come the week before an unusually contentious state visit by Chinese President Xi Jinping next week. Obama said cyber-security would be one one of the biggest topics on the agenda.

"We are preparing a number of measures that will indicate to the Chinese that this is not just a matter of us being mildly upset, but something that will put significant strains on the bilateral relationship if not resolved," he said.

He did not outline what those measures would be, but suggested that the United States would win an all-out cyber-war.

"Frankly, although the Chinese and Russians are close, we're still the best at this. And if we if we wanted to go on offense, a whole bunch of countries would have some significant problems," he said. "Hopefully it gets resolved short of that."

Obama said he doesn't want to see the Internet "weaponized," and hoped to make progress on an international framework — similar to the Nuclear Non-Proliferation Treaty — that would apply to acts of cyber-aggression.