Crowdstrike Co-Founder Dmitri Alperovitch on America’s Second Cold War With China

You got it pretty close.

I have. Everyone gets it wrong. Yeah.

That's right.

It is.

Yeah, it's a nonprofit. It's basically a think tank focused on making sure that the United States remains the great power in the 21st century, primarily dealing with the challenges of China. We look at issues related to defense first and foremost. I just wrote a book on this called World on the Brink: How America Can Beat China in the Race for the 21st Century that is focused on the Taiwan problem, why it matters, and how to defend Taiwan. I was just there to observe a military exercise. We also focus on supply chains, semiconductors, critical minerals, energy security, and of course AI and cyber.

Exactly.

Yeah, I've been convinced that this is a Cold War for 15-plus years. And actually, my background in cyber is what led me to realize that the Chinese are stealing everything we've got—our national security secrets, as you well know, our economic secrets. And when you sort of step back and start looking at what's on the other end of all the theft—building national champions, building up a huge military-industrial base, reforming their military—you start to appreciate that this is all being done for a purpose: to displace the United States economically, geopolitically, and militarily, first in East Asia and then globally. But, you know, I was convinced like many probably China hawks that this was a different Cold War from the first one. Then when I wrote the book—and there's a lot of history in the book, a lot of history of the first Cold War as well—it sort of hit me: oh my god, it's almost exactly the same challenge that we faced in the first Cold War. There's very few differences. You know, the biggest difference probably is just the economic power of China today and some interdependencies that we have with them. And obviously we had fewer during the Soviet era. But on every other account, whether it's the geostrategic competition that we're in with China, it's very exactly the same as with the Soviet Union during the first Cold War. Whether it's the space race—you know, we're literally trying to get to the moon, have you heard that before—before the Chinese do. We have an arms race, a conventional one, a nuclear one. We have a tech war. We have a spy war. We have a race for military bases in the region. We have an ideological struggle. So literally virtually every element of that strategic competition that we had with the Soviet Union is now the same and exists in this realm with China.

So I think this is actually the biggest difference between the first Cold War and the second. You can look at the economic independence. We're actually in the process of decoupling right now, so that's a temporary situation. But the fact that the American public is not obsessed with China and the threat that China poses is the biggest issue, right? Throughout the first Cold War, every election, the Soviet Union was looming in the background despite all the domestic issues. Most op-eds were talking about the Cold War, the Soviet Union. Our movies—Red Dawn, Patrick Swayze fighting the Soviets in the mountains of Colorado—you don't have any of that today, right? And that is a huge issue, because if you're going to mobilize the American public to invest in defense, to invest in reshoring, to invest in rebuilding our manufacturing base, to invest in confronting China in all these different areas, you got to convince them that this is a threat. And that's why I wrote the book. That's why I've been on this book tour. In DC, there is actually bipartisan consensus on this, but you get outside of DC and no one's paying any attention to China.

Not just that, but look at the last Top Gun movie, right? The remake. In the first Top Gun movie, Maverick had the Taiwan patch on his back, right? They had to take it out.

So that they would try to sell to China. The Chinese didn't even allow the movie in, because why would they promote the American Navy? But the fact that they would take the patch off the jacket is just so ridiculous.

Yeah, what year was that?

Yeah, that was early. In those days, you couldn't even say the words China and cyber in the same sentence, right? Remember, we invented the whole APT term—Greg Rattray actually in the White House—because he couldn't talk about China and the defense industrial base being hacked left and right, and he had to invent this "advanced persistent threat" euphemism.

No, now it's totally different. Now it's China, China, China, certainly in national security circles. But it took until 2014 and the PLA indictment for the government to even admit that we had a cyber problem. I remember being at the time at McAfee and then early days at CrowdStrike putting out reports on Chinese espionage, and they were getting a lot of traction in the media. I remember there was one moment when the White House press spokesperson was being asked about one of my reports at the White House podium, and the only thing that he could say is, "We've read it, we've noticed it." Of course it was no revelation to them, but they couldn't even acknowledge that this is accurate.

By the way, this is another difference between the two Cold Wars: I argue this one is way more dangerous because when you look at the territorial conflicts we had with the Soviet Union throughout the Cold War, it started with West Berlin, but it kind of fizzled out after the first 15 years. In fact, I argue that the building of the wall, which we now look at as an egregious act by the Soviets, actually stabilized the Cold War. At the time, JFK, when he was woken up in April of '62 and told that the Soviets are building the wall, he said, "Thank God, because if they're building a wall, they're not invading." Because at the time, that whole summer, people now think about what happened a year later with the Cuban Missile Crisis, but in '62 the threat of a nuclear war between the Soviet Union and America was probably at its highest throughout the entire period because Khrushchev was threatening to invade. JFK went on TV and basically said we're going to defend West Berlin, including using nuclear weapons. That's when we started the craze of building fallout shelters and bomb shelters across the country. Cuban Missile Crisis was tense, but it was 13 days, and for most of that 13 days, the public wasn't even aware that this was taking place. This was the entire summer, and the duck and cover drills came out of that and all that stuff. But the Soviets never really cared that much about West Berlin. It was sort of a symbolic thing. There was no strategic reason to have it—this little enclave within East Germany—and there was no historical attachment to it for them or frankly for us. The other of course obvious confrontation was over Cuba, but again it didn't really matter that much to the Soviets. They backed down once we confronted them. Taiwan is very different, right? It is incredibly strategic to both the United States and China, both economically and geopolitically. You look at the map of East Asia: Taiwan is a cork that keeps China bottled up in East Asia. They can't be a superpower without having Taiwan, without displacing the United States' influence from Taiwan. Obviously the semiconductor industry and the microelectronics industry that's based there is irreplaceable. So the fact that China believes it's theirs and the fact that we can't let them have it makes it way more dangerous than any period during the first Cold War.

Timeline: 2027 I think has been widely misunderstood. The US intelligence community obviously came out with an assessment some years back that Xi Jinping had given an order for the PLA, for the military, to be ready to invade Taiwan by 2027. It was never a deadline for invasion, and I think it was much more of a symbolic date. First of all, as you well know, if you don't give a government agency or military a deadline, it will never happen. So you had to draw some line in the sand. '27 was as good as any, particularly if you go back like seven years when he probably gave it, for several reasons. One, it's his reelection year for another term as Communist Party leader, but it's also the 100th-year anniversary of the establishment of the PLA, right? So the symbolism, which I'm certain will take place probably next August, of him going in front of the party and announcing that he, Xi Jinping, for the first time in Chinese history has built a military capable of invading Taiwan at a moment's notice, is very, very powerful. He won't actually do it in '27 because, A, they're not really ready. In fact, all the corruption and his own purges of the military have pushed the timeline back further. But also, you don't do an invasion during an election year. Whether it's the United States or China, to take such a huge military action is really, really problematic. And I say election—obviously China is not a democracy, but there is an election that happens within the Communist Party elites, and he needs to shore up that support. Almost certainly he will get reelected, but you don't want to roll the dice there. So I think '27 was never in the cards.

I think the real deadline is 2032 because in '27 he gets reelected for a five-year term that expires in 2032. He's 79 in '32. In the Chinese system, they've never had a leader elected into their 80s. Not to say it won't happen, but we've just witnessed in our last election what happens when a leader in his 80s is trying to run for election: frailty, mental acuity, all those things start to diminish. So it's uncertain whether he can actually get another term, and as a result, I think he's thinking that this might be his last term. Somewhere in that time period, he may have to pull the trigger because I do think he is obsessed with taking Taiwan on his watch. Unlike every other previous Chinese leader who sort of looked at Taiwan as "it's ours, but we'll get it at some point in an undefined future," whether it's Mao or Deng Xiaoping and others, Xi Jinping is saying, "Enough is enough. We've waited long enough. We want it, and I want to get credit for it." That's the difference between him and other leaders. And if he thinks that '32 might be the end of his term, somewhere in that period he may decide to pull the trigger. Now, I don't think he's penciled a date in the calendar. I think it's very much conditions-dependent.

I think the key year is actually '28, because in '28 you have elections not just in the United States, but in Taiwan. You have a parliamentary election and a presidential election, and there's a decent chance that the opposition party, the KMT, might win because the current party, the DPP, has been in power for three terms now. In any democracy, it's hard to get four terms in a row. That party has become very friendly to China and in fact currently has a leader that is incredibly friendly to Xi Jinping, which may make him think that if these guys get elected, I can get Taiwan peacefully without invasion. As Napoleon had said, every aggressor is peaceful in that they would like to take over their neighbors unopposed. War is always a last resort for any leader, and certainly for Xi Jinping given the difficulties of invading Taiwan. So he's going to look at the outcome of '28. If KMT actually wins, I think he's going to give them a few years to see if he can push them towards unification through peaceful means. I don't think it will work out, because the Taiwanese population is absolutely not interested in unification. In fact, if you look at the polls, about 5% of Taiwanese—

5% are in favor of unification at some point in the future.

Well, the polls are basically undefined of how that would happen. 1%, like totally within the margin of error, want it today. So 5% even maybe someday.

Yeah, basically, or people that are just completely brainwashed by Chinese propaganda. But basically no one is interested in this. So even though KMT has a chance to win, they're not actually running on a unification agenda. They're running on the party in power is corrupt, there's affordability issues, like all the standard domestic issues. But if they actually try to push for this unification agenda, there's going to be a huge backlash. In fact, we witnessed this in 2014 when KMT was last in power and they were not even trying to push unification, they were trying to do a trade deal with China that was very preferential to China, and there was a huge uproar. There were sit-ins in their legislature, and as a result, they lost the 2016 election and the DPP came into power. That was just a trade deal that mobilized the population. Unification, I just don't see any path for it to happen. People talk about a Hong Kong scenario. There's a huge gulf, not just literally, but figuratively between Hong Kong and Taiwan because Hong Kong was already Chinese. It was turned over to the Chinese in '97. The police stations were taken over by the Ministry of Public Security of China. You had the military there. So for them to take it over was basically no big deal.

Yeah. We had Mark Montgomery on the show. He kind of laid out different scenarios where he thought, you know, strangulation scenario and others. But I think one of the more interesting parts of whatever scenario there is is the intelligence preparation of the environment, battlefield, whatever you want to call it, that's already been done here in the United States. You've talked about this on different shows, but what does that component look like to the average American if China does say, "All right, it's D-Day. We're doing this"? What's going to happen in the US as a part of their preparation to assault Taiwan?

Yeah. So Mark is a good friend. We've gone to Taiwan together. We were supposed to be in Ukraine this year together. We agree on most things. I don't quite agree with him on this. I think there's no path for China taking Taiwan without a full-scale invasion, which would be the most complex military operation in human history, bar none. The reason we know this is that in the last 100 years, there have only been two countries that have seriously thought and planned to invade Taiwan: China obviously being one; the other is the United States, right? In 1944 during World War II, when Taiwan was occupied by Japan, as part of our island-hopping strategy, we put together the plan to invade Formosa, as it was called at the time. The interesting thing is that this was done two months after Normandy, after the greatest amphibious invasion in history. And this plan called for double the number of forces we used in Normandy, right? 150,000 were part of the initial wave on D-Day to land on the beaches of Normandy in the following days. In Taiwan, Operation Causeway, as it was called, it was over 300,000 and huge numbers of casualties estimated. Two months brutal campaign to take the island, and ultimately Roosevelt and others said, "No, too hard. Let's bypass it. Let's do Okinawa instead," which is obviously what we did. So for us, who had just pulled off the greatest amphibious invasion in history, only up against about 60,000 Japanese troops who were on the island, this was considered very, very difficult, very risky. In the intervening 80-plus years, this has only gotten more difficult because obviously you have now long-range strike capabilities, anti-ship, smart mines, satellite reconnaissance, all that stuff. And China has never done anything even remotely approaching the scale. In fact, the last war they fought was '79, right? That did not go over well for them. 46, 47 years ago, they invaded Vietnam and got their butt handed to them. So very, very difficult to do.

The blockade scenario that people talk about, this strangulation scenario, I don't believe works. In fact, I published a piece on this a couple years ago looking at this in great detail. People sort of superficially look at Taiwan's imports of food and energy and say, "Oh my god, they're completely reliant, and you blockade them and you basically starve them to death." Well, if you look at the details as I have, they're actually self-sufficient in food production. Sure, they import food. We import food, right? They import Wagyu and caviar and all sorts of things. But when you look at the details, they have plenty of fish in their internal rivers and oceans, they have a good agricultural sector where they produce rice and vegetables and pineapples, all sorts of things. So there's actually enough caloric production to feed the population. It won't be the most luxurious and varied diet, but you're not going to starve to death.

Exactly. So that's another thing: it's a tropical climate. Even though energy is a huge issue—they do import over 95% of their energy, they're trying to diversify now, reopening their nuclear power plants that they had shut down a few years ago foolishly in my view, they have some solar, they have some wind, they have some hydro, but mostly natural gas is imported. They're building up storage capacity, but it's not enough to sustain them. But again, it's a tropical climate. You're not going to be freezing to death. You probably are going to have enough power generation capacity for the military and for emergency response services, hospitals, whatnot, not for much else. But you're not freezing to death, right? You may not have AC, so that's not going to be pleasant, and it gets really, really hot in Taiwan. But you look at Ukraine, where the power is under enormous pressure during the winters, there are regular power outages and it is brutal, it is freezing in Ukraine during the winter, and they're not surrendering. So I look at Taiwan, I'm like, they're not going to surrender just because you blockaded them. And by the way, they can counter-blockade you and take down the Chinese economy as well as the global economy, because so much of it depends on China.

Well, that's another question of what the United States does: we might run a blockade. If you look at it from China's perspective, it's literally the worst thing imaginable, right? Xi Jinping wants to take Taiwan, but he wants to do it quickly. He wants a fait accompli where, like Putin thought he could take Kyiv in a few weeks, he wants to take Taiwan in a few weeks, declare done, say, "Let's move on, folks. This unpleasantness is over. You want to keep trading with me, it's fine." A blockade is the complete opposite of that. You could have a multi-year blockade that is taking down the global economy, including the Chinese economy. It's anything but quick. And the risks to him are enormous. If you're blockading, you're not invading. And if the United States is confronting you, then you may have to fight the United States without actually invading the island—the absolute worst-case scenario. So I do think it's invasion or nothing. And that's why when you sort of read the open-source PLA literature, there's no talk of blockades. They're focused on invasion, they're building up a capability for invasion. The only people obsessed with blockades are in the United States and Taiwan.

Well, the interesting thing is cyber is a canary in the coal mine. Oftentimes with these things, whether it's 2014 and Crimea and the Donbas with the Russian activities in Ukraine, you first saw a lot of cyber intrusions into Ukraine before you actually saw the military show up and the special forces. You had the same thing in 2021.

I predicted it like three months in advance in early December. Cyber played a role because I was looking at all the cyber activity from Russia into Ukraine that was very different from what they were doing in the past and clearly designed to facilitate invasion. You're now seeing this again. In fact, for the last six years, we've been seeing the Volt Typhoon campaign against our critical infrastructure by the Chinese, where they just maintain persistence there, right? They're not doing anything destructive. You kick them out, they come back in, putting enormous efforts into regaining access in port facilities, energy facilities, water facilities. A lot of them in East Asia—Guam, Philippines, that whole area. A lot of them on the West Coast, where you have the logistics for US military to transport troops and personnel and munitions to Asia. So clearly being done for two purposes: one, to try to impede mobilization and movements of logistics; and two, to try to deter us from intervening by threatening to hold our critical infrastructure at risk. So again, it tells you that things are moving beyond just rhetoric and threats to actual preparation of the battlefield, both in cyber and outside of cyber. One of the most interesting things that has happened in the last couple years has been this massive training camp in Inner Mongolia, where they've literally built an entire road network and a set of buildings to mimic the government building in Taiwan, and they're practicing all the time decapitation strikes in that training camp against—

Yeah, they have these aircraft carriers, Arleigh Burke destroyers mock-ups that they use for target practice as well. They've also built in the last couple years these barges that you can chain link together and create a modern-day equivalent of Mulberry harbours that we used in Normandy to facilitate bringing logistics onto shore. They're doing the exact same thing in a modern way where you can kind of have this highway of barges lined up against the coast and you can offload heavy equipment right onto the beach or even onto the highways. So this is all capability that's not for a blockade, not for a Hong Kong scenario. This is for invasion, and they're building it, they're training for it. This is what I'm very concerned about.

No. There's no bigger crap than the phrases public-private partnerships and information sharing. They're basically meaningless.

It's like, "Hey, I'm going to throw some information over the fence for you. Good luck."

Because we're not willing to do anything else, right? You look at the Five Eyes countries—US, Canada, Australia, New Zealand, and UK. In every single one of them except us, the primary SIGINT agency, the equivalent of the NSA, is responsible for cyber defense of the whole nation—in Canada, in the UK, in Australia.

Right.

Too scary. And look, obviously, you go back to the Church Committee. What the intelligence community was doing in terms of spying on Americans, Martin Luther King, was horrendous, and that has sort of turned us off giving too much power to the intelligence agencies. I get that. But at the same time, all the expertise, all the intelligence lies there. You've been there, right? So the problem with CISA has always been that they're a pass-through, right? They don't have their own intelligence. They don't have the skill sets that the NSA does. So when faced with a choice in the private sector, would a company rather work with NSA or would they rather work with CISA? Almost universally, it's NSA, because you want to go straight to the root of the intelligence, you want to talk to the people with all the capabilities and work with them on solving the problem. And CISA becomes just another link in the game of telephone.

So I think that's always been the problem with CISA trying to defend the nation and not really succeeding in any serious shape there. I've always believed that CISA should be the CISO for the federal government, right? Because we don't have centralized cyber protection in US government. Every agency is doing its own thing. And some agencies will do a good job of it or decent job of it, but some—I hate to pick on them, but just to use an example, Bureau of Land Management. I'm sure there are great people there, but probably never going to attract the best cyber talent in the world, right? So you need a shared—

Trying to think of an agency that's not super technical. And the shared services model, where you provide capabilities for most of the civilian agencies—maybe not FBI, certainly not DoD and the IC, but the rest of the US government—you need one agency to do that that looks across the entire ecosystem, all the networks.

Exactly. And I've always believed that that should be the focus of CISA. That's where they actually got most of the money. But all the rhetoric, all the focus of the leadership has always been on the external because it's sexy: "We're protecting critical infrastructure. We're protecting America." Well, you're not actually doing that because you have no authorities to do that and no capabilities. So I've always argued to Chris Krebs, who's a good friend of mine, and others: hey guys, let's focus on USG. Do a phenomenal job at USG defense. Be some of the best in the world in cyber defense for our internal networks. And then you can make the case: we've showed what we could do on our own networks where we have authorities, now let's talk about what we do nationwide. But don't skip over that step and try to—