American Spies: Espionage against the United States from the Cold War to the Present

17 The End of the Cold War and US Counterespionage

We have slain a large dragon. But we live now in a jungle with a bewildering variety of poisonous snakes. And, in many ways, the dragon was easier to keep track of. CIA director JAMES WOOLSEY at his Senate confirmation hearing, February 1993, US Central Intelligence Agency; “Woolsey, Testimony at Confirmation Hearing.” The End of the Cold War and US Counterespionage 1 7 183 183 On the eve of the 1990s, hundreds of East and West German citizens chipped away at the Berlin Wall until they opened a gaping hole in the most visible symbol of the Cold War division of Europe. Within two years after the Berlin Wall fell, the communist regimes in Eastern Europe were toppled , Germany was reunified, and the Soviet Union ceased to exist. The superpower conflict that defined the world order for almost half a century was over. Still, peace had not come. The “snakes” referred to by Woolsey had crawled out of the jungle in hot spots around the globe. During the 1990s, the United States deployed troops against warlords in Somalia and dictators in Iraq, Serbia, and Haiti. Terrorism gradually replaced the Soviet Union as the greatest threat to national security. A shadowy terrorist group Espionage and the New World Order: The 1990s 184 known as al-Qaeda (Arabic for “the Base”) sprouted from the jihadist forces that had fought the Soviets in Afghanistan and attacked Americans both at home and abroad. In 1993, al-Qaeda fanatics exploded a car bomb in the garage of New York’s World Trade Center; and five years later, al-Qaeda’s cohorts bombed US embassies in Kenya and Tanzania. This new geopolitical order and these new threats were not the only dramatic changes of the decade. Globalization—the burgeoning economic and cultural interdependence of the world’s peoples and corporations—was accelerated by revolutionary developments in telecommunications as the World Wide Web was born and the internet enabled instant communications around the globe. By 1994. one-third of American homes had a personal computer, and by the end of the decade an estimated 50 million Americans surfed the internet. These revolutionary advances also changed spying against America. In the globalized economy, corporate information became as important to a nation’s security as military or political secrets. America, the only remaining superpower when the dust of the Cold War settled, was the primary target. According to a survey by the American Society for Industrial Security, in 1996 alone the loss or compromising of American proprietary information cost more than $2 billion a month, a figure that doubled the following year.1 America’s primary economic competitors had been its staunchest allies in the Cold War struggle against the Soviet Union. No longer facing a Soviet threat, these allies stole corporate secrets to gain advantages in the international marketplace. French intelligence routinely broke into hotel rooms in Paris to steal corporate secrets from the computers and suitcases of American businessmen.2 Ronald Hoffman, a scientist at the Science Applications International Corporation, moonlighted by selling classified software to four Japanese companies. In response to this increasing wave of corporate theft, Congress passed the Economic Espionage Act in 1996, which made the theft or misappropriation of trade secrets a criminal offense. The internet age also affected espionage against America. Some of the spies in the 1990s were computer savvy and used that knowledge to facilitate the acquisition and transmission of secrets to their handlers. At the same time, the computer revolution also benefited spy catchers. The development of data mining and link analysis software allowed investigators to The End of the Cold War and US Counterespionage 185 sift through mounds of information rapidly and establish connections that might quickly narrow the list of potential espionage suspects. These developments still did not deter Americans from spying, although incidents of known espionage decreased in the 1990s. According to DOD’s PERSEREC study, twenty Americans began spying during the decade, only one-third the number during the Decade of the Spy.3 With the Cold War over, new trends in espionage also emerged. The vast majority of Cold War spies had come from the military, but in the 1990s only one-quarter of those arrested for espionage came from its ranks. The military had learned a painful lesson from the espionage cases of the Cold War. All the services that had suffered from spies in their midst had vastly...