The New Spy Wars

How China and Russia Use Intelligence Agencies to Undermine

America
By Calder Walton
July 19,

Outside the Forbidden City in Beijing, China, January 2018

The Cold War never ended. That, at least, is Russian President Vladimir Putin’s view.
The clearest indication that the Kremlin continued its titanic struggle against the West
even after the Soviet Union collapsed can be seen in the activities of Russia’s security
and intelligence services. In their operations and in the vast power they wield in Russian
society, they have picked up where Soviet intelligence left off. Since 1991, these agencies
have been driven by a revanchist strategy to make Russia great again and to overturn
the post–Cold War U.S.-led international order. Putin’s war in Ukraine is the bloody
conclusion of that strategy.
China is also seeking to reverse the outcome of the Cold War. With the “no limits”
alliance proclaimed on the eve of Russia’s invasion of Ukraine, Putin and China’s
leader, Xi Jinping, are attempting to upend the international system—and they are
leaning heavily on their intelligence organs to do so. Spy agencies can do what other
branches of government cannot: execute non-avowed foreign policy. Both Russian and
Chinese intelligence have done so in the furtherance of their revisionist goals, taking
advantage of the United States while it was distracted by the “war on terror” to damage
U.S. national security, undermine Western democracies, and steal as many scientific
and technical secrets as possible. 
ALL THE TSAR’S MEN
Russia’s intelligence services view themselves as the direct heirs of the KGB. Although
the KGB was disbanded in 1991, many of its former officers and all of its tradecraft, files,
and even agents in the West were transferred to Russia’s new security service, now
known as the FSB, and foreign intelligence service, the SVR. For years after the end of
the Cold War, Russian intelligence continued to run former Soviet agents in the West,
including the CIA counterintelligence official Aldrich Ames and the FBI agent Robert
Hanssen. It was business as usual for Russia. The SVR’s first director, KGB veteran
Yevgeny Primakov, continued the Soviet intelligence agency’s traditions of coercion and
blackmail—tactics that he himself had fallen victim to as a young man. According to
material smuggled from the KGB’s archives, Primakov had been blackmailed into
serving the agency while working as a journalist in the Middle East in the 1960s. The
founding father of the FSB, Rem Krassilnikov, was also a former KGB officer and
communist true believer; his wife was named Ninel, which is Lenin spelled backward.
According to an FSB defector who worked under Krassilnikov in the 1990s, the FSB
used the same training manuals as the KGB, but with the ideological sections about
communism simply ripped out.  
Then there is Putin himself, whose experience in the KGB’s foreign intelligence
directorate profoundly shaped his subsequent political career. While stationed in
Dresden in East Germany—a KGB sideshow, since the real action was in East Berlin—
Putin witnessed the Soviet empire’s disintegration firsthand. It was, as he later said, the
greatest catastrophe of the twentieth century. Putin calls himself a “Chekist,” in honor of
the early Soviet secret police, the Cheka, and had a statue of Cheka founder Felix
Dzerzhinsky in his office when he was the FSB director. To this day, Putin walks with the
gunslinger gait of an FSB man, left hand swinging but right hand motionless next to an
invisible side arm, to let everyone know he’s trained.
Like many Russians, Putin has suffered from something like phantom limb syndrome
ever since the Soviet Union collapsed. As a result, in the 1990s, it took little to convince
him that NATO was by definition hostile to Moscow. Soviet intelligence used to call the
United States “the main enemy”—and once the main enemy, always the main enemy. In
the 1990s, Russia’s intelligence services were, if anything, more aggressive toward the
United States than the KGB had been in the later Soviet period. Nothing breeds
aggression like humiliation.
To this day, Putin walks with the gunslinger gait of an FSB man.

By the end of the 1990s, the SVR was using the Internet to spread disinformation to
discredit the United States. SVR officers stationed in the United States bombarded U.S.
media outlets and messaging boards with themes straight from the Soviet propaganda
script, including the U.S. government’s secret racist agenda and its illegal development
of biological weapons. Sometime around 1996, Russian hackers instigated a massive
breach of sensitive U.S. government databases, including those of NASA and the
Pentagon.  
U.S. intelligence was not sitting on its hands, of course. As Russia’s economy tanked in
the late 1990s, the CIA was able to reel in some valuable Russian recruits who betrayed
—for cash—their spymasters and blunted Moscow’s intelligence operations against the
West. But then came 9/11.
BLINDED BY THE FIGHT
At first, it seemed that the war on terror might be a chance for a reset, an occasion for
greater U.S.-Russian intelligence cooperation. After his first meeting with Putin in 2001,
U.S. President George W. Bush famously remarked that he had been “able to get a sense
of his soul” and believed him to be trustworthy. Russia’s intelligence services did
initially cooperate with the United States on counterterrorism. But according to CIA
officials, the U.S.-Russian intelligence honeymoon after 9/11 was short-lived, giving way
to an era of clandestine Russian aggression. Meanwhile, Washington was looking the
other way. Throughout the war on terror, the U.S. government plowed overwhelming
resources into counterterrorism at the expense of efforts to deal with threats from
resurgent powers such as Russia and China.
So did many U.S. allies, including the United Kingdom. According to a 2020 report by
its parliamentary intelligence and security committee, the British security service MI5
devoted a staggering 92 percent of its work to counterterrorism in 2006. This was the
same year that a former FSB officer, Alexander Litvinenko, was assassinated in London
with radioactive polonium. Later, a British public inquiry found that Putin himself had
probably approved the murder, as had then FSB head Nikolai Patrushev, another KGB
veteran who now sits on Putin’s national security council. There is no corresponding
public data on how U.S. intelligence agencies divided their attention and resources
between counterterrorism and other priorities after 9/11, but U.S. intelligence officers I
interviewed said that counterterrorism was the overwhelming focus of the U.S.
intelligence community. As late as 2017, counterterrorism was still the top budget item
for the U.S. Office of the Director of National Intelligence.
Putin has run Russia as a militarist mafia regime.

Putin’s genius was to obscure from Western powers after 9/11 that although he was
cooperating on counterterrorism, he was also using his intelligence services to solidify
his authoritarian regime and make Russia into a great power again. At home, he
silenced dissent, crushed the free press, and eliminated his opponents, following the
Stalinist tradition of “no man, no problem.” In Russia’s near and far abroad, Putin
sought to prevent the expansion of NATO and contain what he saw as U.S. subversion in
eastern Europe by invading Georgia in 2008, Crimea in 2014, and the rest of Ukraine in
2022. NATO expansion fed Putin’s fears about Western subversion, but it is fanciful to
suppose that without enlargement of the alliance Russia would have been a peaceful or
responsible player in global politics. Putin has run Russia as a militarist mafia regime.
Since coming to power three decades ago, Putin has made Russia’s security and
intelligence services into a virtual state within a state. He relies on a clique of
Chekist siloviki, or “men of force,” who have intelligence and military backgrounds and
who wield disproportionate influence in his police regime. According to CIA insiders, an
overwhelming majority of the Kremlin technocrats who run Russia’s economy had such
backgrounds in 2020.
It is little wonder, then, that Russia’s strategy and tactics are straight from the Soviet
playbook, albeit updated for the cyber-age. Social media and digital interconnectivity
provide new means for older ends, giving Russia’s spy services capabilities that the KGB
could only have dreamed of. Putin has used a variety of covert actions to subvert his
opponents in the West. He has interfered in Western democratic elections, most
strikingly in the U.S. presidential election in 2016, preserving a Soviet tradition
stretching back to at least 1948. Putin has also kept alive the Soviet practice of deploying
deep cover “illegals” in Western countries, some of whom have been arrested and traded
back to Moscow in spy swaps that resemble those of the last century’s Cold War.
Although Putin has encouraged the notion that he is a master spy, in reality he has
presided over a succession of intelligence failures. In 2010, for example, the FBI and
CIA wound up a network of Russian illegals in the United States. They did so by
recruiting a key officer inside the SVR’s illegals program who fed Washington secrets.
But Putin’s greatest intelligence failure preceded his decision to invade Ukraine in
February 2022. U.S. and British intelligence agencies successfully pieced together
Putin’s war plans and exposed them to the world, thereby removing his ability to
concoct pretexts for the invasion.
If it ever becomes possible to see the intelligence that Putin was given in the lead-up to
the war in Ukraine, it would not be surprising to find that it confirmed, rather than
contradicted, his overestimation of Russia’s military strength. There is little room for
truth telling in Putin’s court, just as there was in Stalin’s. The murderous nature of
Putin’s rule guarantees that he is given sycophantic intelligence. Since the start of the
war, Russian intelligence has suffered a series of operational failures, including the
dismantling of its spy networks in Norway, Sweden, and Slovenia.
NOT JUST ANY OLD SPY SERVICE
Like Russia, China also exploited the U.S.-led war on terror to advance its interests.
According to CIA officers with deep China expertise, Beijing’s principal civilian
intelligence service, the Ministry of State Security, declared war on U.S. intelligence in
2005. From then on, while Washington was consumed by the war on terror, the MSS
threw its best resources and officers at the U.S. government and U.S.
corporations, stealing as many scientific and technical secrets as possible to bolster
China’s economy and its military power. Internal MSS deliberations from this time were
marked with glee that the United States was mired in the Middle East and inattentive to
China’s clandestine successes.
The MSS’s assault on the United States soon paid off. In 2010, the Chinese spy agency
dismantled a major CIA network in China, leading to the murder or imprisonment of
more than a dozen U.S. sources, according to an investigative report published by The
New York Times. It remains unclear exactly how Chinese intelligence compromised the
CIA network, but the damage was undeniable. Ten years later, a U.S. intelligence official
with firsthand knowledge of these events told me that the CIA had still not recovered in
China.
Under Xi, China has become the world’s principal cyberthief.

Since Xi came to power, China’s intelligence offense against the West and the United
States, in particular, has grown exponentially. The mission of Chinese intelligence is to
execute Xi’s grand strategy: to make China into the number one military and economic
power in the world and invert the existing technological landscape, making other
countries dependent on Chinese technology instead of American technology. Chinese
spy services employ a “whole of society” approach to collecting intelligence: they hoover
up human, cyber, and signals intelligence (using balloons and apparently an
eavesdropping base in Cuba) while also exploiting publicly available sources, including
social media. Through a series of draconian national security laws passed under Xi, the
Chinese Communist Party also compels Chinese businesses to cooperate with
intelligence agencies whenever requested, thus fusing spying and buying. The result is a
Chinese mercantilist authoritarian model without parallel in the West. The CCP uses
talent programs and cultural exchanges for espionage by another name. Beijing also
exploits Chinese communities in Western countries, pressuring them to pass on
intelligence, often by blackmailing them or threatening family members in China.
Under Xi, China has become the world’s principal cyberthief, stealing more personal
and business data from Americans than every other country combined, according to the
FBI. In 2021, the FBI reported that it was opening a new China-related
counterintelligence investigation every 12 hours. And in July 2023, the United
Kingdom’s parliamentary intelligence and security committee reported that the Chinese
government has penetrated every sector of the British economy.
Phrases such as “U.S.-Chinese competition” do not do justice to the ugly reality. Like
Russian intelligence agencies, Chinese intelligence services compete according to
fundamentally different rules from those followed by their Western counterparts. Unlike
U.S. or European spy agencies, the MSS is not subject to the rule of law or to
independent political oversight. Nor is the MSS publicly accountable to Chinese citizens
or scrutinized by a free press. These differences mean that statements such as “all states
spy,” often used to discount Chinese espionage, are dangerously misleading. Just
because all armies have guns does not mean they are the same. Unlike Western services,
there are few meaningful restraints on Chinese or Russian intelligence agencies. In fact,
Chinese and Russian services are limited only by operational effectiveness—what they
can get away with. Western governments and publics need to wake up to this threat.
OLD GRUDGES, NEW WEAPONS
During the Cold War, both the United States and the Soviet Union industrialized
intelligence collection, using computers to attack each other’s cryptology. Spying moved
from on land, deep under the sea, into the stratosphere, and then even into space.
Today, Western governments are in a new cold war with Russia and China that is again
transforming the nature of espionage. This new cold war is not a repeat of the last one,
but it does have continuities and similarities, including a stark asymmetry in the East-
West intelligence conflict. It was colossally difficult for Western clandestine services to
collect reliable intelligence on closed police states behind the Iron Curtain; now it is
even more difficult for them to operate effectively in Russia or China, with their
Orwellian domestic surveillance systems. Meanwhile, it is relatively easy for Russia and
China to steal secrets from the open, free, and democratic societies of the West, just as it
was for the Soviets before them.
But the similarities between this superpower conflict and the last one should not blind
us to their differences. China’s massive economic weight and integration into the global
economy differentiate it from the Soviet Union. Today’s information landscape is also
much different from that of even the recent past. Commercial satellite companies, for
example, now offer capabilities that until recently would have been the preserve of
governments. Open-source and commercial intelligence are transforming national
security. In the last Cold War, approximately 80 percent of U.S. intelligence was derived
from clandestine sources while 20 percent came from open sources. Today, those
proportions are thought to be reversed. The future of Western intelligence lies not with
governments but with the private sector. The challenge for Western governments is to
harness the capabilities of commercial intelligence providers. This will require new
public-private partnerships.
What Western governments need more than anything, however, is imagination when it
comes to intelligence collection about closed police states. Imagination is what led the
CIA to develop high-altitude U-2 planes that were capable of spying behind the Iron
Curtain when other methods were impossible. Similar imagination is needed today in
areas at the forefront of national security, including open-source intelligence gathering,
the use of machine learning and artificial intelligence, and quantum computing. These
will be the weapons of this century’s cold war—and those that will determine its
outcome.