Not many winners in the NSA spy scandal, are there? Oh sure, German Chancellor Angela Merkel has been reaping some political applause at home for standing up to the Americans - in polls, 62% of Germans approve of her stand - but even that support has been mixed. Many Germans want her response to be even stronger, and a majority are telling pollsters they want to scrap the mooted EU/US Transatlantic trade talks, until better safeguards on privacy and security issues are put in place. Certainly, that’s not what Merkel would want. Moreover, the German website Der Postillon has satirically noted that Merkel seems to be more enraged about the wiretap on her own phone than about the NSA’s wholesale spying on the general public: "The chancellor considers it a slap in the face that she has most likely been monitored over the years, just like some mangy resident of Germany." The NSA, for its part, has claimed that much of the complained-of spying by the NSA has actually been carried out by the domestic spy agencies in the countries concerned, and handed on to the NSA.

The original Der Spiegel stories that triggered the Merkel scandal can be read here. Der Spiegel usefully describes the source of surveillance: a unit called the ‘Special Collective Service’ located in US diplomatic posts worldwide:

A "top secret" classified NSA document from the year 2010 shows that a unit known as the "Special Collection Service" (SCS) is operational in Berlin, among other locations...The secret list reveals that its agents are active worldwide in around 80 locations, 19 of which are in Europe -- cities such as Paris, Madrid, Rome, Prague and Geneva. The SCS teams predominantly work undercover in shielded areas of the American Embassy and Consulate, where they are officially accredited as diplomats and as such enjoy special privileges. Under diplomatic protection, they are able to look and listen unhindered. They just can't get caught.

Wiretapping from an embassy is illegal in nearly every country. But that is precisely the task of the SCS, as is evidenced by another secret document. According to the document, the SCS operates its own sophisticated listening devices with which they can intercept virtually every popular method of communication: cellular signals, wireless networks and satellite communication. The necessary equipment is usually installed on the upper floors of the embassy buildings or on rooftops where the technology is covered with screens or Potemkin-like structures that protect it from prying eyes.

The Der Spiegel stories include a detailed example of a NSA surveillance report on Merkel’s cellphone. Of more interest to New Zealanders would be this breakdown of how the US spies prioritise the regions and topics in which they are interested:

The White House and the US intelligence agencies periodically put together a list of priorities. Listed by country and theme, the result is a matrix of global surveillance: What are the intelligence targets in various countries? How important is this reconnaissance? The list is called the "National Intelligence Priorities Framework" and is "presidentially approved." One category in this list is "Leadership Intentions," the goals and objectives of a country's political leadership. The intentions of China's leadership are of high interest to the US government. They are marked with a "1" on a scale of 1 to 5. Mexico and Brazil each receive a "3" in this category. Germany appears on this list as well. The US intelligence agencies are mainly interested in the country's economic stability and foreign policy objectives (both "3"), as well as in its advanced weapons systems and a few other sub-items, all of which are marked "4."

Safe to say, if the NSA is carrying out surveillance of New Zealand and its trading partners, we would be rating a “5" on most topics. All the same, whenever New Zealand has dealings with China, one could also safely assume that those communications would be of interest to the US, as part of its global data gathering on the actions and intentions of its prime target, China. In the Pacific, New Zealand is likely to play a data gathering role to play on behalf of the Americans, with respect to China’s developing relationships with the countries in the region. Currently, the US would also have a keen interest in the negotiating positions of other countries involved in the Trans Pacific Partnership (TPP) trade talks, and it seems highly likely that US-managed economic espionage is being carried out on all the countries involved in the TPP, including New Zealand.

Not that, of course, we are going to be officially made any the wiser about this or any related situations. As security analyst Paul Buchanan pointed out on RNZ yesterday morning, it comes down to oversight, or the lack of it. Congress, Buchanan noted, is asking President Barack Obama as to when and whether he had personally authorised of the NSA tapping of Merkel’s phone. New Zealand on the other hand - which has far less robust systems of oversight of its spy agencies - has political leaders who seem blissfully content to be kept completely in the dark about what our spy agencies are doing. As Buchanan pointed out:

The Prime Minister yesterday said that he didn’t bother asking questions of the GCSB of that type - and this happens a month or so after he assured the New Zealand public that he would personally guarantee that the GCSB does not engage in unlawful activities. So the issue of oversight rears its head, yet again...because intelligence agencies are wont to push the envelope as much as they can, absent legal constraints against their activities. And once you go offshore, there are very few domestic constraints as to what you can do.

In its own defence, the NSA has tried to portray itself as the aggrieved, picked on party. As the NSA and its defenders argue, all countries spy on each other, including allies. There is some truth in that. No doubt, much of Merkel’s wrath has been feigned for domestic political reasons. By and large, action becomes necessary not when you know that you’re being wiretapped - but when the public gets to know that you’re being wiretapped, thereby is making a pantomine of national outrage politically necessary. In any tit for tat sense though, it does come down to a question of scale - and the simple truth is that NSA is doing far more intensive spying and far more extensive spying than anyone else. For that reason, it is pretty amusing to see that the US has apparently been the target of economic espionage by one of its most trusted allies, South Korea. Here’s Foreign Policy magazine on the subject:

...The South Koreans are interested in the F-35 [Joint Strike Fighter], but their interest comes at the same time as South Korea's bid to build its own stealth jet, raising bureaucratic eyebrows in the United States. It could be the equivalent of South Korea taking a fighter jet on a test drive, as it were, flying it around the corner to kick its tires, only then to return it to the dealership and say it's not interested, but first looking under the hood and taking some pictures.

Why should the US be feeling so paranoid about the South Koreans? Well, Foreign Policy report continues:

From anti-ship missiles, electronic warfare equipment, torpedoes, a multiple-launch rocket system, and even components on a Korean-made Aegis destroyer, the United States is concerned about the uncanny resemblance those systems bear to American weaponry. Even the tanks that [US Defense Secretary Chuck] Hagel watched on the range [at a South Korean defense display] may be partial knock-offs: The Korean models have fire control systems that appear to be all-but-identical to the American versions.

It has happened before:

In May 2011, Young Su Kim, a former vice president at a Colorado-based firm, Rocky Mountain Instrument Company, helped in the illegal export to South Korea of military technical data for prisms that are used in guidance or targeting systems in unmanned aerial vehicles, AC-130 gunships, tanks, and missile systems. He was sentenced to five years behind bars, according to data provided by the Department of Justice.

And in 2010, Juwhan Yun, a naturalized American citizen of Korean origin was sentenced to 57 months in prison after pleading guilty to attempting to illegally export to South Korea components for a 20mm gun and a Russian fighter jet, RD-180 rocket propulsion systems, and other technology without the State Department's approval. He was arrested the year before in Florida and later indicted for attempting to purchase rocket materials for a company working on the Korean Satellite Launch Vehicle, according to the Justice Department. Yun had also been convicted in 1989 of conspiracy for violating the Arms Export Control Act in connection to exporting 500 quarter-ton bombs of sarin gas to Iran, none of which made it to its final destination, according to data provided by Justice.

So yes, “friends” do spy on “friends” and foes alike. In the case of New Zealand, no one would expect John Key to talk about the extent of domestic and foreign spying and the counter measures (if any) that we have in place. Yet it would be a lot more re-assuring if our Prime Minister - who is the Minister responsible for the oversight of the security services, for God’s sake - was not so gormlessly willing to flag the need for having any oversight role at all.

ENDS

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