Why Allies Spy on Each Other

Blast from the past — The WSJ archive has some interesting perspectives on international espionage.

Why Is U.S. Spying on Friends? March 11, 1997

Germany’s discovery that an American diplomat was spying on its Economics Ministry raises an important question: Why is the U.S. spying on its friends?

The question is particularly pressing because the case is actually the third reported in two years.

In 1995, the U.S. Central Intelligence Agency had to suspend virtually all of its operations in France after four of its officers were accused of spying on French economic officials during world trade negotiations. Later that year, the administration of President Clinton again was embarrassed…

Obviously a string of incidents and controversy like this can give the US a bit of a reputation for spying on other countries. Much of the data was murky and accusations stood unanswered. A few years later, however,an ex-CIA director gave an in-your-face explanation:

Why We Spy on Our Allies, March 17, 2000

By R. James Woolsey, a Washington lawyer and a former director of central intelligence.

What is the recent flap regarding Echelon and U.S. spying on European industries all about? We’ll begin with some candor from the American side. Yes, my continental European friends, we have spied on you. And it’s true that we use computers to sort through data by using keywords. Have you stopped to ask yourselves what we’re looking for?

Victims of espionage are supposed to ask themselves whether the ends justify the means? He argues that we should consider his motive.

Why, then, have we spied on you? The answer is quite apparent from the Campbell report — in the discussion of the only two cases in which European companies have allegedly been targets of American secret intelligence collection. Of Thomson-CSF, the report says: “The company was alleged to have bribed members of the Brazilian government selection panel.” Of Airbus, it says that we found that “Airbus agents were offering bribes to a Saudi official.” These facts are inevitably left out of European press reports.

That’s right, my continental friends, we have spied on you because you bribe. Your companies’ products are often more costly, less technically advanced or both, than your American competitors’. As a result you bribe a lot. So complicit are your governments that in several European countries bribes still are tax-deductible.

Note the confidence in his second paragraph. When a competitor’s products were deemed more costly, less advanced or both then America’s intelligence agency was called in to look for bribes.

No, that’s not quite right. The intelligence agency was called in to document the bribes it knows it would find. What made America’s top intelligence agency so certain bribes would be found?

The European Parliament’s recent report on Echelon, written by British journalist Duncan Campbell, has sparked angry accusations from continental Europe that U.S. intelligence is stealing advanced technology from European companies so that we can — get this — give it to American companies and help them compete. My European friends, get real. True, in a handful of areas European technology surpasses American, but, to say this as gently as I can, the number of such areas is very, very, very small. Most European technology just isn’t worth our stealing.

[…]

Why do you bribe? It’s not because your companies are inherently more corrupt. Nor is it because you are inherently less talented at technology. It is because your economic patron saint is still Jean Baptiste Colbert, whereas ours is Adam Smith. In spite of a few recent reforms, your governments largely still dominate your economies, so you have much greater difficulty than we in innovating, encouraging labor mobility, reducing costs, attracting capital to fast-moving young businesses and adapting quickly to changing economic circumstances. You’d rather not go through the hassle of moving toward less dirigisme. It’s so much easier to keep paying bribes.

I’m not sure I understand this correctly…

A former official of the CIA says he justifies American spying on allies because the American economic model is superior; a model he believed was not dominated by government interference. What’s the best way he found to prove that superiority? He used American government interference.

That’s not the end of it, of course. He also has to take a swipe at the French.

The French government is forming a commission to look into all this. I hope the commissioners come to Washington. We should organize two seminars for them. One would cover our Foreign Corrupt Practices Act, and how we use it, quite effectively, to discourage U.S. companies from bribing foreign governments. A second would cover why Adam Smith is a better guide than Colbert for 21st-century economies. Then we could move on to industrial espionage, and our visitors could explain, if they can keep straight faces, that they don’t engage in it. Will the next commission pursue the issue of rude American maitre d’s?

Get serious, Europeans. Stop blaming us and reform your own statist economic policies. Then your companies can become more efficient and innovative, and they won’t need to resort to bribery to compete.

And then we won’t need to spy on you.

Need? I missed the need part.


Update Nov 17 2020: Danish whistle-blower exposes NSA spying on European countries to win economic competition in airplane sales.

The American intelligence service NSA used a top secret Danish-American spy collaboration to purposefully spy on central ministries and private companies in Denmark.

[…]

The analysis of the data queries from 2015 reveals, according to DR News’ information, that the NSA at that time used the spy system to spy on targets in Denmark’s closest neighbors Sweden, Germany, France, Norway and the Netherlands.

According to the experts, the new information could strain Denmark’s relations with its closest neighbors .

“I would not like to be the political decision-maker who had to tell my colleagues in Germany or Sweden that ‘unfortunately, we have now learned that the Americans have used an access with us to spy on you'”, says Professor Jens Ringsmose from the University of Southern Denmark.

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