US Capitol violence obscures serious foreign cyber-hacks

LAST week's siege of the US Congress by what US President-elect Joe Biden has called "domestic terrorists" has dominated media headlines since. Yet, this has obscured what may be an even more significant - foreign - attack on US financial and national security interests: the recent major cyber-hacks by Russia.

On the very same day of the extraordinary disorder in Washington, a key US intelligence report was released last Wednesday which highlights that up to 10 US government bodies, including the US Treasury, had their data compromised. It is known already that hackers compromised dozens of Treasury e-mail accounts, and also broke into systems in the Treasury's departmental offices division, home to the highest-ranking officials. Organisations outside of government were also affected, with work still ongoing to understand the scope of the incident more than a month after details first emerged.

Were it not for Wednesday's Capitol Hill debacle, and the intensifying pandemic, the hack of critical US infrastructure by Moscow (which denies involvement) would have taken up many more headlines around the world. Part of the reason why the incident is so serious is that the breach was undiscovered for months with the attacker showing a degree of sophistication and stealth that the report says is a trademark of SVR, Russia's foreign intelligence agency.

Coming into office on Jan 20, with Russia relations already in the deep freeze, President-elect Biden must quickly choose how best to respond to the apparently massive hack. So far, there is only drift and denial from Donald Trump continuing a pattern of him underplaying threats from Moscow. Indeed, the sitting president's main contribution so far to this debate is to suggest that Beijing was the guilty party without any evidence to support this.

It is already clear that Mr Biden will take meaningful steps to respond to the financial and national security breach that goes beyond sanctions. Moreover, one of the first foreign policy actions of the Biden team will be to map out ways to degrade the capacity of foreign actors to engage in cyber-attacks against US interests.

Options being considered by Mr Biden to punish Moscow include financial penalties and retaliatory hacks on Russian infrastructure. However, a final decision will await more details on the nature of the breaches, how extensive they are, and what damage has been done.

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While the outlook for US relations with Russia therefore is bleak in the immediate term, the incoming White House team is keen to try to cultivate a more constructive relationship in the medium term of his presidency. Mr Biden hopes that European governments will be partners on this engagement agenda which, after the uncertainties of the Trump era, will welcome the strongly Atlanticist, pro-Nato new president in power.

RESTARTING TALKS

Mr Biden was, of course, one of the architects of the attempted US re-set of relations with Moscow in the Obama era when key achievements included the US-Russia civilian nuclear cooperation agreement whose 10-year anniversary was Monday. One of the ambitions of the Biden team here with Moscow is seeking to restart talks on a longer-term extension of the New Strategic Arms Reduction agreement before momentum dissipates entirely.

Russia was one of the last major countries across the world to acknowledge Mr Biden's election victory last year, and the Putin regime has no great hopes for an improved relationship under the new US presidency. The last four years of Mr Trump's administration have been a deep disappointment for Moscow after the initial hints of a rapprochement and calls to "fully restore" ties.

The president had several meetings with Mr Putin and appeared to believe Russia is not a serious threat to the United States and that a new era in bilateral ties was needed. He believed there are multiple common interests over issues such as counter-terrorism and combating nuclear non-proliferation, and potentially even helping contain China in a new global balance of power, that could recast relations.

Yet, Mr Trump's goal was stalled by the accusations of his team's collusion with Russia. That was a charge that was not completely refuted by the Mueller report which made clear that Moscow made significant and sustained efforts to influence the outcome of the 2016 US presidential election against Democratic nominee Hillary Clinton.

However, a much wider range of issues clouded the bilateral agenda too. This included disagreements on issues from Iran to Syria and arms control deals, including the 1987 Intermediate-Range Nuclear Forces Treaty which the Trump team began withdrawing from in response to alleged Russian violations.

Tensions between the two sides became particularly strained over Syria. Mr Trump's former secretary of state Rex Tillerson - who knew Mr Putin from the time he served as CEO of Exxon Mobil - said in 2017 that "either Russia has been complicit or simply incompetent" referring to Moscow's apparent inability to prevent the Assad regime from using chemical weapons, despite a 2013 agreement, under which Russia was a guarantor, to remove these stockpiles from the country. The depths to which there was real animosity in relation was underlined by then-Prime Minister Dmitry Medvedev who said that bilateral relations had sunk to being "one step away from war" and "totally ruined" after Mr Trump ordered US bombing in Syria.

Going forward, one of the key uncertainties over US-Russia relations that Mr Biden wants to probe is the degree to which Moscow's much warmer ties with Beijing are now set in stone under the presidencies of Mr Putin and China's Xi Jinping. Perhaps the most cited area of warmer ties is on the political and security front. However, China and Russia also enjoy an extensive economic dialogue which has warmed since Moscow's annexation of Crimea.

RUSSIA-CHINA TIES

The Chinese president asserted last year that bilateral relations are at "the highest-level, most profound and strategically most significant relationship between major countries in the world" and also praised Mr Putin by stating that he "is my best, most intimate friend". The Russian president appears to share this sentiment, underlining how misguided Mr Trump's conviction may have been that Moscow might ally with Washington against Beijing.

Taken together, there are clear limits on the degree to which any warming of US-Russia ties might occur during Mr Biden's presidency. Relations may be significantly retarded in the immediate term by the fallout from Moscow's cyber- hack, while there are also constraints on significantly better ties for as long as Moscow's relationship with Beijing remains so close under Mr Xi and Mr Putin.

• The writer is an associate at LSE IDEAS at the London School of Economics