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Some sideways thinking about cyberwarfare

Cyberwarfare needs to be framed far more broadly.

When we hear the term “cyberwarfare” we think of government-backed hackers stealing data, or releasing viruses or other software exploits to disrupt another country’s capabilities, communications, or operations. We imagine terrorists or foreign hackers planning to destroy America’s power grid, financial systems, or communications networks, or stealing our secrets.

I’ve been thinking, though, that it may be useful to frame the notion of cyberwarfare far more broadly.  What if we thought of JP Morgan’s recent trading losses not simply as a “bad bet” but as the outcome of a cyberwar between JP Morgan and hedge funds?  More importantly, what if we thought of the Euro’s current troubles in part as the result of a cyberwar between the financial industry and the EU?

When two nations with differing goals attack each other, we call it warfare.  But when financial firms attack each other, or the financial industry attacks the economy of nations, we tell ourselves that it’s “the efficient market” at work.  In fact the Eurozone crisis is  a tooth-and-claw battle between central bankers and firms seeking  profit for themselves despite damage to the livelihoods of millions.

When I see headlines like “Merkel says Euro Rescue Funds Needed Against Speculators” or “Speculators Attacking the Euro” or “Banksters Take Us to the Brink” it’s pretty clear to me that we need to stop thinking of the self-interested choices made by financial firms as “just how it is,” and to think of them instead as hostile activities.  And these activities are largely carried out by software trading bots, making them, essentially, a cyberwar between profiteers and national economies (i.e. the rest of us).

I know that the reality is more complex than those statements might suggest, but reality always is. Financial firms have legitimate interests in profit seeking, and sometimes the discipline of the market is just what national economies need. But when does it go too far? The US and Israel had legitimate security interests in undermining the Iranian nuclear program too.  That doesn’t mean that we didn’t call Stuxnet an act of cyberwarfare.

One of the things we try to do on the Radar blog is to frame things in a way that help people to see the future more broadly.  I do believe that one of the major long-term trends that we need to include in our thinking is that foreign policy (including the possibility of cyberwarfare) is no longer just between nations, but between nations and individuals (whether the collective activists of popular revolutions or the terrorist as the oft-discussed “violent non-state actor“), between nations and big companies, and between companies and industries.

And just as we expect nations not to act out of untrammeled self-interest lest the world go to hell in a handbasket, I think it’s reasonable to ask financial firms to show self-restraint as well. Either that, or expect that at some point, nations may decide to fight back with more than their central banks.

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  • Juan Crespo

    I must agree. There is a fine difference (not necessarily in mindset, but in tactics employed) between a cabal of conspirators versus a corporate board of directors. The cabal might be interested in maximizing profits just as the board of directors is, and be equally determined to do so, but their market segment might be drugs, guns (and rock ‘n ‘roll?… sorry) versus. cornering the precious metals market, oil, or financial. The drugs may be illegal or pharmaceutical, or even grey market. BTW, the guns may be gov’t sponsored foreign military sales or CIA ops, and not just the stuff that “fell off the truck.” There are a lot of activities that can be done by both sides, and the damage can be heavy, widespread, and lingering, whether its pulling the trigger release on a weapon, or hitting FUNCTION-f8 on a derivatives pricing application…

    Just waiting for the day when the White House orders missile strikes against Citicorp HQ after they ignore the Attorney General’s (or Congress’s) subpoenas.

    • http://myindigolives.wordpress.com/ Ellie K

      Oh please, don’t spread that alarmist talk. Citicorp’s headquarters are in New York City. If they were disobedient, Consolidated Edison could enforce immediate compliance by dispatching two field crew to take all facilities off line, as in, “No Electricity For You”. Nor hot running water.

      You can’t have this both ways. The tech world becomes outraged with ISP’s, Amazon, Google, any company that is domiciled in the U.S.A., when said companies comply with government subpoena’s or requests for data. Yet here you are, anticipating a scenario for the same companies, well, Citicorp, instead of Amazon, such that they do NOT comply with the law of the land, and that the remedy would be for “the White House to order missile strikes against Citicorp”!

  • http://twitter.com/MattDevost Matt Devost

    Winn Schwartau framed it that way in 1994 with his book information warfare including several classes of cyberwarfare to include corporate and even individual.

  • Railmeat

    Tim, please don’t encourage them. There is no cyberwarfare. Every time I hear “Cyber…” anything I know I am listening to a bureaucrat trying to increase their budget or reduce my civil liberties.

    None of the espionage, sabotage or vandalism that takes place on line is different from what take place off line. That fact that computers and networks are involved does not change that.

    • Cmdrtaco

      To generalize is to be an idiot. — William Blake

  • http://voidstar.com/ jbond

    Perhaps some of those examples might better be framed as “Algorithm Wars”. Particularly in the financial markets there’s an evolutionary process going on breeding better and faster algorithms. For various metrics of “better”.

  • http://www.facebook.com/people/Samantha-Appleseed/100003671294406 Samantha Appleseed

    Nice identification Tim. A system built on weak ideology cannot withstand the transcendence of short-sighted deadlocked debates, the exposure of an expansive and encroaching negative reality is potent. For an ideology to survive it dares not go to the end, it rely’s on leaving it’s true implications a little bit in the shadow, the story incomplete.

    I like the hyper-agreement “This system works, you are right, but you have no idea how very right you are”. The congested rocky road of subjugation is occupied, but the Blue Oceans not.

  • Christopher Olson

    @JamesGRickards has spoken at length on this subject, and is an expert in it. He has provided us with an excellent narrative of this in his 2012 book Currency Wars.

  • http://www.facebook.com/people/Samantha-Appleseed/100003671294406 Samantha Appleseed

    No image, not Pinterest friendly :)

    • http://myindigolives.wordpress.com/ Ellie K

      I would go so far as alleging it to be downright… Pinterest-hostile! I gave it a try (I’ve pinned stuff from Microsoft Research successfully), figured that I might as well try for a pin of Tim’s head shot as the jewel in the crown of my Friendly Financial Markets pinboard.

      This is what happened: First, I got the “no image available” message that we legions of Pinterest pinners have learned to dread. And guess what happened next? Tim O’Reilly crashed my browser! Chrome stable release 20.whatever. This post did very well on Google+ though. Sigh. I don’t think it is particularly good, certainly not original. But I’ll get to that in another comment.

      Nice to see other Pinners around, Samantha! Don’t be a stranger, stop by Friendly Financial Markets, okay?

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  • TrentJess

    You are a Cyber Warrier, are you not, Tim? Are you not perpetrating warfare on all of us in order to achieve your vision of Utopia? Are you not employing subtle techniques, meant to deceive, based largely on theories of Cybernetics as formulated by 19th Century thinkers such as Norbert Weiner?

    Why do you hide in plain sight? Why do you not have the fortitude to articulate your vision, and your means for attaining such vision?

    ——

    “This was the original premise of purposive systems as expounded by Norbert Wiener and Julian Bigelow in 1943: intelligent behavior evolves as a consequence of the ability to measure and keep account of the effects of a given signal through feedback loops that return a message signifying the magnitude of the result. These principles are common to automatic anti-aircraft guns firing at a moving target, neurons seeking to make the right connections inside the brain, laboratory animals facing a maze, corporations facing a free-market economy, or any other situation where it is possible to place a value on an objective at which to aim.”

    ~ George B. Dyson, Darwin among the Machines

    ——

    What Mr. Dyson fails to clarify in the above quote, referring to Weiner’s book (Human Use of Human Beings), is that feedback control systems are not only intended for use in anti-aircraft guns, but also for control of entire societies of human beings. This is the aim of Oreilly’s work, which he fails to disclose.

    • http://myindigolives.wordpress.com/ Ellie K

      Norbert Weiner lived, and died, in the 20th century, not the 19th century. Though now I am wondering, is Esther Dyson related to George Dyson?