And, apparently, the largest cyberwarfare army as well

From China, With Love: Cyberwar the Next Big Threat to the U.S.?

THE BLOTTER : The White House is preparing a new initiative to protect against what it fears could be a crippling attack against the U.S. by computer, from overseas, and in particular, from China.

After a series of cabinet-level meetings this month at the White House, computer security analysts say the Bush administration is considering creating a new agency or cyberwar center to better protect the federal government's computers and find ways to help private companies and public utilities fend off computer attacks.

Those attacks, which could be just a few key strokes away, could shut down U.S. power grids and communication and banking systems, security analysts warn.

How could such a thing come to pass?

Oh and btw,

Chinese, US citizens charged with espionage in San Francisco

A Chinese national and a US citizen have been charged with conspiring to steal sensitive microchip designs capable of use in military technology, justice officials said Wednesday.

The US Attorney's office in northern California said Lee Lan and Ge Yuefei had been indicted on multiple charges of conspiracy to commit economic espionage and to steal trade secrets.

Lee, 42, a US citizen, and Ge, 34, a Chinese national, had sought to steal secrets from their employer, NetLogics Microsystems, and from the Taiwan Semiconductor Manufacturing Corporation, a statement said.

The two men had set up a company for the purpose of developing and marketing products related to the stolen trade secrets, and had attempted to secure funding from the Chinese government, it added.

"The vigorous enforcement of intellectual property statutes increases the economic vitality of this region, and adds to the security of our nation as a whole," US attorney Scott Schools said

AND ANOTHER...

US Video Shows Hacker Hit on Power Grid

TED BRIDIS and EILEEN SULLIVAN

WASHINGTON (AP) - A government video shows the potential destruction caused by hackers seizing control of a crucial part of the U.S. electrical grid: an industrial turbine spinning wildly out of control until it becomes a smoking hulk and power shuts down.

The video, produced for the Homeland Security Department and obtained by The Associated Press on Wednesday, was marked "Official Use Only." It shows commands quietly triggered by simulated hackers having such a violent reaction that the enormous turbine shudders as pieces fly apart and it belches black-and-white smoke.

The video was produced for top U.S. policy makers by the Idaho National Laboratory, which has studied the little-understood risks to the specialized electronic equipment that operates power, water and chemical plants. Vice President Dick Cheney is among those who have watched the video, said one U.S. official, speaking on condition of anonymity because this official was not authorized to publicly discuss such high-level briefings.

"They've taken a theoretical attack and they've shown in a very demonstrable way the impact you can have using cyber means and cyber techniques against this type of infrastructure," said Amit Yoran, former U.S. cybersecurity chief for the Bush administration. Yoran is chief executive for NetWitness Corp., which sells sophisticated network monitoring software.

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