Tuesday, August 21, 2018

What Microsoft's Revelation about Russian Hacking Means for the Midterms - Fortune

August 21, 2018.

What Microsoft's Revelation about Russian Hacking Means for the Midterms
Trump, Putin Deny Russian Meddling in the 2016 Election.
Here’s what they had to say.

By HALLIE DETRICK 5:41 AM EDT
Microsoft announced Monday that it had detected and thwarted the early stages of an attempted attack on the U.S. Senate and two conservative think tanks by Fancy Bear, the Russia-linked group that hacked the Democratic National Committee in 2016.

Microsoft president Brad Smith told The New York Times that the latest detected threat demonstrates a broadening in the types of websites hackers are going after, to now include organizations that are “informally tied to Republicans.”

Eric Rosenbach, the director of the Defending Digital Democracy project at Harvard University, similarly emphasized to the Times that Russians are attacking organizations based on their own self-interest rather than a preference between the two major American parties: “It’s about disrupting and diminishing any group that challenges how Putin’s Russia is operating at home and around the world.”

This latest attempt to gain access to political leaders ahead of the midterms is not the only one that has been detected. Last week it emerged that two Democratic congressional primary candidates were hacked, though the attacker has not yet been publicly identified.

Microsoft received a court order to take control of six websites that were designed to resemble Congressional domains, such as “senate.group” and “adfs-senate.email.” The Hudson Institute and the International Republican Institute were also targeted. Using these domains, hackers could have carried out a “spearphishing” attack to obtain user credentials, similar to the one that brought down Hillary Clinton’s campaign chairman John Podesta in 2016.

The latest revelation comes amid rising tensions between the U.S. and Russia ahead of the midterm elections. Special Counsel Robert Mueller’s investigation of links between the Trump campaign and Russia continues, and a U.S. grand jury indicted 12 Russian intelligence officers on charges of hacking the computer networks of the Democratic Party and Hillary Clinton’s campaign in 2016. Meanwhile, President Trump and Russian President Vladimir Putin continue to deny any Russian meddling in the election, even as politicians and experts warn that the system remains vulnerable to attack.

Despite Talks With China, Trump Is in No Rush to Call Off His Trade War - Daily Intelligencer ( New York Magazine )

August 21, 2018.

Despite Talks With China, Trump Is in No Rush to Call Off His Trade War
By Jonah Shepp

Trump’s not expecting much from talks with China. Photo: Bloomberg/Bloomberg via Getty Images
Stock markets rose around the world on Monday on the news that the U.S. and China are beginning mid-level talks in Washington this week to try to resolve the escalating trade conflict between the world’s two largest economies, even as another $16 billion round of tariffs comes into effect. By the end of the trading day, Wall Street had dipped after President Donald Trump told Reuters in an interview that he was “not thrilled” with Federal Reserve Chairman Jerome Powell’s agenda of raising interest rates.

The rest of the Reuters interview was released after the closing bell and was not priced into Monday’s trading, but likely would have erased more of those gains, as Trump said he wasn’t expecting much to come out of this week’s talks. “I’m like them, I have a long horizon,” Trump told the agency, explaining that he had “no time frame” for ending the dispute.

It’s never clear whether Trump is on the same page of the policy agenda as his officials, but in this case, the president’s statement appeared to contradict what American and Chinese officials told the Wall Street Journal on Friday, which is that they are aiming to reach a deal to avert a trade war by the time Trump and Chinese President Xi Jinping are scheduled to meet at the Asia-Pacific Economic Cooperation forum and the G20 summit in November.

The Chinese government is eager to see the dispute settled quickly, for obvious reasons: A protracted trade conflict with the U.S. would damage China economically and complicate Xi’s plans to transform the country from a low-wage manufacturing powerhouse into a global leader in high technology. He has reportedly instructed his deputies to stabilize the relationship with the U.S. as soon as possible.

The Trump administration, on the other hand, is not in such a rush. November is still three long months away, and the U.S. Trade Representative’s office wants to delay negotiations and keep ratcheting up the tariff pressure in an attempt to secure a deal from a position of dominance in October.

Needless to say, the U.S. business community is not thrilled at the prospect of even more barriers to trade with a country they rely on for all manner of raw materials and finished goods. The U.S. has so far slapped duties on $34 billion of Chinese goods, but the USTR wants to impose another $200 billion on a wider range of imports, including for the first time an array of consumer goods.

In the first of six days of public hearings on the new proposed tariffs on Monday, business owners warned that they would lead to huge price hikes, driving up consumer costs and putting tremendous, possibly ruinous strain on import-dependent American businesses. Meanwhile, the CEO of the global shipping giant Maersk said in a presentation on Friday that Trump’s protectionist tariffs on China and other countries could slow U.S. trade growth by up to 3 or 4 percent: a huge hit.

Granted, these businesses have a direct interest in the public believing that claim and in the administration forgoing another round of tariffs, but it’s not hard to see how raising the price of Chinese furniture and lighting products, tires, chemicals, and plastics, among other things, by as much as 25 percent would hit Americans in the wallet and disrupt a variety of U.S. industries. Of course, Trump might in that case turn around and blame these companies for passing the costs onto consumers.

The deal with Beijing the administration hopes to negotiate would see China reduce industrial subsidies, cut production in industries like steel and aluminum where overproduction has been depressing global prices, stop pressuring U.S. companies to hand over proprietary technology, buy more U.S. goods and services, and bolster the value of its currency, the yuan, to make the dollar more competitive.

This is a hefty slate of demands, but significantly pared down from the completely unreasonable proposal U.S. negotiators put forth in May, which would have compelled China to cut its trade surplus by $200 billion, abandon its industrial policies, and refrain from contesting U.S. lawsuits against it at the World Trade Organization. That was never going to happen. Under pressure and eager to reach a resolution, China may be more amenable to the less stringent terms now on offer, or some approximation thereof.

On the other hand, the Trump administration needs to be wary of China accepting a deal, then failing to fulfill its side of the bargain. Derek Scissors, a China expert at the American Enterprise Institute, points out that China has failed to keep its promises on trade in the past and has been evasive about the behaviors this deal would seek to curb, such as intellectual property theft. The administration, Scissors argues, will need to enforce any deal rigorously, using the threat of sanctions.

Beijing might well balk at such conditions, however, and even if Xi is eager to make a deal, he will not bend over backwards to accept whatever the U.S. is magnanimous enough to give him. The economic impact of a full-on trade war would complicate things politically for Xi, but giving into American demands to his country’s disadvantage would be even more damaging to his prestige. Xi has consolidated his power in Beijing, indeed to a troubling extent, and will likely remain in control of the country for another decade or more no matter what, but if he is given a choice between belt-tightening and national humiliation, he won’t have to think too hard about that decision.

Anyway, China’s efforts to become a global economic superpower are proceeding apace in other realms, such as Belt and Road Initiative, a drive to massively upgrade overland trade infrastructure between China, Central Asia, Europe, and the Middle East, as well as sea routes to Southeast Asia, South Asia, and Africa. This huge endeavor will project Chinese trade power in these regions, particularly Africa, to an even greater degree than its influence is already being felt.

There is a strong current in Chinese political discourse today that its rise to superpower status is unstoppable, even in the face of American resistance. Indeed, a trade war would much more likely slow that process than stop it completely. China’s dominance of global manufacturing was as much an organic product of globalization as a deliberate consequence of Chinese industrial policy or U.S. trade policy. Xi’s high-tech ambitions today reflect the fact that China is actually beginning to lose low-cost manufacturing operations to other, less developed Asian countries with lower labor costs.

China is going to keep on being China, no matter what Trump does. Yes, Beijing needs to be held accountable for its anti-competitive trade practices, but there may be limits to how far a trade war can go toward achieving that goal without doing unacceptable damage to the U.S. economy instead.

Perhaps the most important question to ask about these trade wars is what would it mean to win them? Trump’s obsession with trade deficits, based on the unorthodox theories embraced by his key economic advisers, has led to these deficits actually expanding as U.S. buyers rush to place import orders before prices go up. Trump’s economic policies in general are unlikely to reduce the U.S.’s current account deficit, economist Scott Sumner argues in an op-ed at The Hill, and hardly anyone other than Trump’s trade adviser Peter Navarro, Commerce Secretary Wilbur Ross, and the president himself believes that trade deficits reduce American economic output.

No matter what Trump believes, trade is not zero-sum. Before the administration embarks on a trade war with China, perhaps it should explain to the American people exactly what it would mean to win it.

Trump floats possibility of taking over Mueller probe: 'I can go in and I could do whatever, I could run it if I want' - Fox News

August 21, 2018.

Trump floats possibility of taking over Mueller probe: 'I can go in and I could do whatever, I could run it if I want'
Gregg Re By Gregg Re | Fox News


Trump expresses increasing frustration with Mueller probe
President accuses Democrats of using the special counsel to impact midterm elections; Kevin Corke reports from the White House.

President Trump asserted on Monday that he would be "totally allowed" to take over Special Counsel Robert Mueller's probe if he wanted to, in another thinly veiled broadside against an investigation he has repeatedly derided as a partisan "witch hunt."

"I can go in, and I could do whatever — I could run it if I want," Trump told Reuters. "But I decided to stay out. I’m totally allowed to be involved if I wanted to be. So far, I haven’t chosen to be involved. I’ll stay out."
The extraordinary comment -- apparently a reference to Trump's executive authority to order Deputy Attorney General Rod Rosenstein at the Justice Department to fire or replace Mueller -- came as jurors continued to deliberate in the first trial brought as a result of Mueller's probe. There was no verdict in the case on Monday, raising the defense team's hopes after three days of deliberations.

Trump also repeated the concerns raised publicly by his personal attorney, Rudy Giuliani, that speaking with Mueller's team directly would expose him to perjury charges, even if he told the truth.

President Trump's attorney accuses the special counsel of trying to run the Russia investigation into the midterm elections on 'The Story.'
TRUMP LASHES OUT AT MUELLER 'THUGS' IN MONDAY TWEETS, CALLS SPECIAL COUNSEL A 'NATIONAL DISGRACE'

“So if I say something and [former FBI Director James Comey] says something, and it’s my word against his, and he’s best friends with Mueller, so Mueller might say: ‘Well, I believe Comey,’ and even if I’m telling the truth, that makes me a liar," Trump said. "That’s no good.”

Speaking exclusively to Fox News' "The Story with Martha MacCallum" Monday night, Giuliani defended his comment Sunday that "truth isn't truth," which drew a firestorm of criticism on social media. Prosecutors can bring perjury charges against an honest witness, Giuliani said, as long as they can find others to present an alternative version of events.

Giuliani also alleged that Mueller's team was trying to cause political damage for Trump, even though, he said, prosecutors had assured him they did not want to repeat Comey's mistakes.

"They're trying to run this right up until the election," Giuliani said, calling the investigation a "travesty."

"They're trying to do the same thing Comey did -- they're trying to be the judge and jury of the 2018 election," he added.

Giuliani also downplayed a report over the weekend that White House Counsel Don McGahn had extensive meetings with Mueller, saying McGahn is an "honorable" man who would have resigned long ago if Trump had told him to do anything illegal.

"They're trying to do the same thing Comey did -- they're trying to be the judge and jury of the 2018 election."

- Rudy Giuliani
"I can't imagine him sitting around the White House for six months with a president he thinks committed a crime," Giuliani said.

Trump also told Reuters that he hadn't "given a lot of thought" to the possibility of revoking Mueller's security clearance -- a move that would be sure to trigger a political uproar in Washington and potentially unravel the Mueller probe.

Last week, the White House terminated ex-CIA Director John Brennan's security clearance, charging that he had misled Congress about the CIA's role in spying on Senate staffers and improperly politicized his access to classified information with his attacks on the president.

Trump told Reuters the Mueller probe had “played right into the Russians - if it was Russia - they played right into the Russians’ hands.”

Separately, Trump also responded to the news that several tech giants, including Google, Apple, Facebook, and Twitter, had removed or banned content from conspiracy theorist Alex Jones.

"I won't mention names, but when they take certain people off of Twitter or Facebook and they're making that decision, that is really a dangerous thing because that could be you tomorrow," Trump said.

Fox News' Martha MacCallum contributed to this report.

Russia plans largest war games since end of Soviet Union - CNN

Russia plans largest war games since end of Soviet Union

By Brad Lendon, CNN

Updated 0852 GMT (1652 HKT) August 21, 2018

A Russian Sukhoi Su-24 attack aircraft makes a very-low altitude pass by the USS Donald Cook (DDG 75) April 12. Donald Cook, an Arleigh Burke-class guided-missile destroyer, forward deployed to Rota, Spain is conducting a routine patrol in the U.S. 6th Fleet area of operations in support of U.S. national security interests in Europe.


Putin announces 'invincible' new missile (March 2018)

(CNN)Russia will stage the its largest war games since the fall of the Soviet Union next month, the country's Defense Ministry said Monday.

Thousands of troops from China and Mongolia are expected to join in the exercises in Siberia, dubbed Vostok 2018, according to statements from the Russian and Chinese defense ministries.
The games will have an "unprecedented scale both in territory and number of troops involved," supreme commander-in-chief of the Russian armed forces, General Sergi Shoigu, said in a statement.
Shoigu said it would be the "largest event since the Zapad-81 maneuvers," which involved as many as 150,000 troops, according to CIA documents.
Those exercises saw the Soviet Union test new weapons, including intermediate range ballistic missiles. Videos from the Zapad-81 games show huge formations of tanks and artillery as well as jet aircraft making mock attacks.

If Vostok 2018 is of the scope Shoigu suggested, it would be bigger than the Kremlin's Vostok 2014 exercises. Those involved 155,000 troops, 8,000 pieces of equipment, more than 600 aircraft and 80 naval vessels.
China's contribution to the massive exercises will be 3,200 troops, 900 weapons, and 30 planes and helicopters, which will deploy from September 11 to 15 at Russia's Tsugol training range near where the borders of Russia, China and eastern Mongolia meet, China's Defense Ministry said in a statement.
"The exercise is not directed against any third party" and will focus on "maneuver defense, firepower strikes and counterattack," it added.
The September dates announced by China overlap with the Russian-sponsored Eastern Economic Forum in Vladivostok. Chinese President Xi Jinping is among the leaders expected to attend this year's version of the annual event, hosted by Russian President Vladimir Putin.

In preparation for the September war games, Russian military chief Shoigu ordered surprise combat readiness inspections of airborne troops as well as long-range aviation and air transport units.
The inspections involve "16 special exercises" with an emphasis on "aviation readiness" and "timely deployment of military command and control bodies."
Russia has been highlighting its military this year, with Putin in March boasting of new weaponry he claimed would render NATO defenses "completely useless." Some of those arms were shown off in a video released shortly after his July summit with US President Donald Trump.
While the US military has cast doubt on the abilities of the new Russian weapons, a US Defense Intelligence Agency report from 2017 notes Moscow is in the midst of "a massive state armaments program" aimed at equipping its forces with "70% new or modernized equipment by 2020."
At the same time, China is also modernizing its military, launching new warships, including its first domestically made aircraft carrier, and world-class guided-missile destroyers. Earlier this year Beijing pronounced its newest stealth fighter, the J-20, combat ready.
A Pentagon report on China's military released last week said Beijing was developing its fleet of long-range bombers and "likely" training its pilots for missions targeting the US.
China called the US report "irresponsible" and said Beijing's military moves are only designed to safeguard its "sovereignty and security."
CNN's Serenitie Wang and Angus Watson contributed to this report.

Microsoft claims win over 'Russian political hackers' - BBC News

August 21, 2018.

Microsoft claims win over 'Russian political hackers'

A Russian hacking group known as Fancy Bear is accused of trying to disrupt the US midterm elections
Russian attempts to launch cyber-attacks against US conservative groups have been thwarted, Microsoft says.

The software company said Russian hackers had tried to steal data from political organisations, including the International Republican Institute and the Hudson Institute think tanks.

But they had been thwarted when its security staff had won control of six net domains mimicking their websites.

Microsoft said the Fancy Bear hacking group had been behind the attacks.

Domain control
"We're concerned that these and other attempts pose security threats to a broadening array of groups connected with both American political parties in the run-up to the 2018 elections," Microsoft said in its blog detailing its work.

The thwarted attack was likely the start of a "spear phishing" campaign, said Microsoft. This would involve tricking people into visiting the mimicked domains allowing the Fancy Bear group to see and steal login information that people use.

As well as the two think-tanks, the domains seized were associated with several Senate offices and services. One domain sought to mimic Microsoft's Office 365 online service.

Hunt wants 'malign' Russia to face action
Trump relaxes rules around cyber-attacks
US accuses Russia of 'pervasive' meddling
The New York Times suggested that the two think tanks were targeted because they were former supporters of President Trump but were now foes who had called for more sanctions to be imposed on Russia.

The International Republican Institute's directors include Senator John McCain and General HR McMaster who was replaced earlier this year as the White House national security adviser.

IRI president Daniel Twining told the Times that the attacks were consistent with the "campaign of meddling" the Kremlin is known to have indulged in.

In its blog, Microsoft president Brad Smith said it had grabbed dodgy domains 12 times in two years to shut down 84 websites associated with Fancy Bear.

It said that, so far, it had no evidence that the domains had been used in any attacks.

Microsoft added that the attack activity seen around the domains "mirrors" what it saw in 2016 in the US and during the 2017 election in France.

Microsoft's action comes soon after the US charged 12 Russian intelligence officers with hacking computer networks used by Hillary Clinton and the Democratic Party.

Russia has consistently denied meddling in the elections or mounting any cyber-attacks on US institutions.

Mueller inquiry: Trump fears 'perjury trap' in Russia inquiry - BBC News

August 21, 2018.

Mueller inquiry: Trump fears 'perjury trap' in Russia inquiry

President Trump has repeatedly referred to the Mueller investigation as a "witch hunt"
US President Donald Trump has said he is worried he might face perjury charges if he gives statements under oath to the investigation into Russia's alleged role in his election victory.

He told Reuters news agency he feared any discrepancies between his account and others could be used against him.

Mr Trump also suggested he could take over the investigation run by special counsel Robert Mueller, but said he'd decided to stay out of it.

He has called the inquiry a witch hunt.

Russia also strongly denies claims it interfered in the 2016 election, which saw Mr Trump defeat Democratic rival Hillary Clinton.

In the Reuters interview, Mr Trump expressed concern that any statement he made to investigators could be compared with that of others who have testified, such as former FBI chief James Comey, and that any discrepancies could be used against him.

Who's who in Trump-Russia drama?
All you need to know about Trump Russia story
He was echoing previous concerns by his lawyer, Rudy Giuliani, who said Mr Trump could be "trapped into perjury".

"So if I say something and he (Comey) says something, and it's my word against his, and he's best friends with Mueller, so Mueller might say: 'Well, I believe Comey,' and even if I'm telling the truth, that makes me a liar. That's no good," President Trump said.

Mr Trump also asserted that he could, if he wanted to, intervene in the investigation, but added that he had chosen not to do so for now.

"I've decided to stay out. Now I don't have to stay out. I can go in, and I could do whatever - I could run it if I want. But I decided to stay out," he said.

"I'm totally allowed to be involved if I wanted to be. So far, I haven't chosen to be involved. I'll stay out."

In an interview with NBC on Sunday, Mr Giuliani was asked whether the Trump team was stalling about a possible testimony at the Mueller inquiry.

Lawyer Rudy Giuliani was widely ridiculed for suggesting "truth isn't truth"
Mr Giuliani said: "I'm not going to be rushed into having him testify so he can be trapped into perjury."

He added: "When you tell me that he should testify because he's going to tell the truth and he shouldn't worry, well that's so silly because it's somebody's version of the truth. Not the truth."

NBC host Chuck Todd countered: "Truth is truth."

Mr Giuliani responded by saying: "Truth isn't truth." That comment was widely mocked on social media.

Special counsel Mueller is investigating whether President Trump's campaign team colluded with Russia to influence the outcome of the presidential election.

In 2016, US intelligence agencies concluded that Russia had used a state-authorised campaign of cyber attacks and fake news stories planted on social media in an attempt to turn the election against Mrs Clinton.

Thirty-two people have now been indicted, including four members of Mr Trump's campaign team and 25 Russians.

The president's former campaign manager, Paul Manafort, is the first person to go on trial as a result of Mr Mueller's investigation. However, the charges are not related to the US election but instead to tax evasion and money-laundering stemming from his political consultancy work in Ukraine.

The jury in his case is in its fourth day of deliberation to reach a verdict.