France Second Only to China in Stealing U.S. Commercial Secrets

Americans tend not to take France seriously. “Cheese eating surrender monkey” seems to sum up America’s thoughts about the French, when Americans can be bothered to think about the French at all. And that may just suit the French just fine. No one expects anything shady from them because no one expects anything at all from them. So I was about as surprised as could be when I heard former Defense Secretary Robert Gates say that the French are second only to the Chinese when it comes to cybertheft of American intellectual property.

Speaking in an interview with the Council on Foreign Relations about cyber-security and cybertheft, Gates said, “There are probably a dozen or 15 countries that steal our technology in this way. In terms of the most capable, next to the Chinese, are the French —  and they’ve been doing it a long time.”

He also said, “For years, French intelligence services have been breaking into the hotel rooms of American businessmen and surreptitiously downloading their laptops, if they felt those laptops had technological information or competitive information that would be useful for French companies. France has been a mercantilist country — the government and business have operated hand in hand — since the time of Louis XIV.”

Now maybe it’s all those Peter Sellers movies I watched as a kid, but I have this image of Inspector Clouseau fumbling around in the Holiday Inn Paris (because no American businessman can get his accountant to OK the George V). Somehow, it all ends with the French spy covered in shaving foam and tangled in a telephone cord while a confused American with a woman who isn’t his wife looks on.

Besides, I used to work at BNP Paribas, the huge French bank. In my experience, the only thing that could make a French business less effective would be adding the ineptitude of the French government to the mix.

However, the matter is quite serious. First off, there is the fiction that allies don’t spy on one another (presuming you can accept the idea that France really is an ally of the United States). In fact, the clandestine services of any country will spy on anybody. However, we don’t tend to broadcast that fact so that people don’t get up in arms about it. America and Israel still have troubles over the case of Jonathan Pollard, a Yank who spied for Israel. He’s been in jail for years. So, for Gates to bring this up suggests to me that the French are going beyond what is tolerable.

Second, we’re talking about money and jobs. Last summer, computer security firm McAfee did a report for the Center for Strategic and International Studies on cybertheft.

The company said that cybertheft costs America $100 billion a year, which in a $14 trillion economy is just a rounding error. On the other hand, the U.S. Commerce Department said in 2012 that for every $1 billion in exports, the U.S. gets $5,080. So that $100 billion in lost exports cost 508,000 jobs. That’s more than a couple months of job growth.

Now a lot of that is private companies stealing from U.S. firms. And quite a bit of it comes from semi-official Chinese hackers (or Unit 61398 of the People’s Liberation Army if you want to talk about official theft). However, suppose the French can make off with $1 billion — that 5,080 Americans out of work. Of course, it isn’t as if France creates 5,080 jobs at their end; their labor market is too inefficient. French cybertheft puts more Americans out of work than the number of Frenchmen who get jobs as a result.

Of course, you can always fight fire with fire. I am confident that America has hackers in its employ who could make off with French industrial know-how, or rather, they could if the French had any. Look, this is a country that ordered 341 trains that are too wide for the 1,300 platforms they were going to serve. The railway engineers “forgot to go and measure the actual distance between lines and platforms.”

For the record, I actually like France. I have fond memories of my vacations there. Alexandre Dumas wrote the best book ever, “The Three Musketeers,” in French. And French is one of my favorite ethnic cuisines. I admire the way its president can cheat not only on his wife but on his mistress as well and continue to govern. I just wish the French would steal American technology from the Chinese — at least, that looks better.

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