The growing threat of ransomware attacks - Axios
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The growing threat of ransomware attacks

Rebecca Zisser / Axios

Get used to the kind of ransomware attack that crippled critical infrastructure and shut down major corporations yesterday. It was an escalation of the kind of cyber attack that's becoming a regular occurrence worldwide with a reach that's threatening key elements of national security.

Why it matters: These kinds of attacks are affecting more people as they spill out of the cyber realm and impact hospitals, power grids, and multi-national corporations. At the same time, consumer anxiety about security is at an all-time high, according to the recent Unisys Security Index, and EY's Global Capital Confidence Barometer, which shows cybersecurity concerns are delaying business deals. The physical and digital worlds are converging, and consumers are more vulnerable to threats as our lives become more connected than ever.

Ukraine's prime minister, Volodymyr Groysman, called yesterday's cyberattack — which targeted government workstations, power companies, banks, state-run TV stations, airports and ATMs — "unprecedented" in scope. The so-called Petya attack reboots victims' computers, encrypts their hard drive's master file (instead of individual files) and renders their entire hard drive inoperable. The ransom requested for access to an infected computer is $300 in bitcoin, and "doesn't seem consistent with state-sponsored attackers," Bret Padres, a former intel official and CEO of The Crypsis Group, tells Axios, although he would not rule out a state-sponsored attack.

An escalation: Monzy Merza, Director of Cyber research for Splunk, told us the attack is "a change in behavior" by hackers. It comes just over a month after the massive WannaCry ransomware attack, conducted by a North Korean hacking group, spread to 300,000 breaches across 150 countries. "As far as we can tell this is an escalation or at least a similar attack as the WannaCry ransomware," Padres said. Plus, if Ukraine is really a "testing ground" as Merza suggests, this ransomware attack shows the perpetrators are trying to perfect their techniques before carrying out another, potentially larger one.

Implications for the U.S. Padres says that "Eastern European systems are more likely to be running unpatched and could be more vulnerable to this type of attack," but the "bulk of the U.S. capability in cyber security is in it's offensive operations. We are in a very vulnerable place when it comes to defenses." A State Department official said, "We are actively monitoring the situation."

The attacks and its results are becoming more targeted. While it may seem that attacks are happening more frequently, what's actually happening is that hackers are choosing to publicly showcase the ramifications of the attack:

  • During WannaCry, consequences, such as preventing hospital systems from working, showed how a virus can bring vital technology systems to a screeching halt.
  • During Petya, attackers aimed to show their ability to destroy the systems that just about everyone relies on, from power grids to banks to a country's oil supply.
Need for proactive policy: Carl Herberger, Vice President of security at Radware, said the attack has highlighted the need for an international organization to better police and protect against the rise in global cyber-threats. "The FBI was created as a result of the pandemic of interstate bank recoveries and the need to hold criminals across borders accountable for their unjust actions. In a way, that is what we need right now," said Herberger.
The real payday: Only a few dozen people appear to have paid the ransom, according to Raj Samani, head of strategic intelligence at McAfee. But the real cost comes to governments and companies — like major advertising agency WPP that had to shut down some offices for the day — reeling from the impact.
  • "There's something to be said that if you target critical infrastructure and the like, putting safety at risk, you are a little closer to the 'payday' you are after – especially if the time to recover through in-house processes is longer than is acceptable," said David Kennerley, director of threat research at Webroot.
  • For example, the attack had direct ramifications for Ukraine's nuclear power management:

Be smart: Herberger says that no matter the size of your business, you can become a victim in today's cyber-landscape. So "patch your systems, properly back up your network, educate your employees on potential threats, and should you fall victim to an attack, don't pay the ransom."

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Scaramucci goes full Breitbart

Breitbart / YouTube

Anthony Scaramucci gave his first interview as White House communications director to Breitbart's Matt Boyle. The two sounded like old friends, with Scaramucci kicking off the Saturday morning Breitbart radio interview by jokingly asking Boyle, "Did you send your job application form in yet, Matt?...Do you need my email so I can get your resume over here?"

Boyle laughed and replied: "Anthony, I'm honored, maybe we can talk about that later." Scaramucci praised Breitbart for capturing "the spirit of what is actually going on in the country, where there's a large group of people...who've been disaffected from the economic franchise."

FWIW: I asked Boyle whether he'd seriously consider a job in the White House press shop and he declined to comment.

Between the lines: Sean Spicer had a terrible relationship with Breitbart, the right-wing outlet whose alumni, including Steve Bannon, now work in the White House. Scaramucci now appears to want to elevate the outlet in general, and Boyle in particular. By giving Boyle (Breitbart's most unrestrained attack dog) such prominence from the outset, Scaramucci is signaling that the President wants to make better use of conservative/friendly media outlets to transmit his messages without a critical filter.

Interview highlights:

  • Breitbart First: Scaramucci told Boyle that he and the President talked Friday about the fact that there are "enough outlets, whether it's Breitbart, the President's social media feed, all of the different apparatus that we have where people will allow us to deliver our message to the American people unfiltered."
  • Fresh start: Scaramucci also called his appointment a "fresh start" and said he wanted to see if he could "de-escalate" tensions with mainstream media outlets.
  • Bonding over "fake news": At the end of the interview Boyle asked Scaramucci how he planned to "combat" the "fake news" given he was a "victim of fake news" recently on CNN. Boyle was referring to CNN's recent retraction of a story about Scaramucci, which resulted in CNN management firing three employees. Boyle wrote more than a dozen pieces bashing CNN during that period. Scaramucci said to Boyle: "You've also been a great help in terms of exposure and I do appreciate what you did for me during that incident...I want to thank you publicly in front of your listeners."
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Inside the White House "rival gangs"

Mark Von Holden/Invision via AP

On this week's episode of The New Yorker Radio Hour, Editor David Remnick talks with the N.Y. Times' Maggie Haberman (transcript here):

  • On the White House atmosphere: "We're used to a team of rivals. We are not used to a team of the Bloods and the Crips. ... [T]hese are rival gangs. ... I need to add in some new gang names, too, because Bloods and the Crips makes it sound like there are only two teams. There's something like six."
  • On Trump's mental state: "I think that he has an amazing belief in his own ability to will what he thinks into reality. And I think that he thinks of reality as something that is subjective. So I think that what people characterize as 'he's out of touch' or 'he's not understating this' or 'he seems off,' or whatever — I think he has an amazing capacity to try to draw the world as he wants it."
  • How Trump really feels about the press: "I think that he loves the press. I think he lives, at least loosely, by the theory that, if not all press is good press, that most press is good press. I think you find the press has been his nurturer and validator for thirty to forty years."
  • "This is a person who courted the tabloids aggressively in New York City in the nineteen-eighties. He found a way to make himself a commodity for the gossip pages and play the tabloids off each other. He likes attention, and he likes media. He loves to manipulate the media. He's a master at it."
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Spicer: resigning was "the right thing to do"

Alex Brandon / AP

After his sudden resignation yesterday, former press secretary Sean Spicer sat down for an interview with Fox News' Sean Hannity. The one exchange you need to know:

HANNITY: Have you been thinking about this for a while?

SPICER: No.

HANNITY: So it was really sudden?

SPICER: Well, I knew what the right thing to do is. I think I have a pretty good compass, and I made a decision that it was in the best interest not of just myself, but ... for the President and for this administration, was to step aside and let Anthony and Sarah lead the team.

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Trump finds a new favorite member among divided WH

Laurent Gillieron / Keystone via AP

The day's stunning dominoes ("Abrupt chain reaction for Trump" is the five-column head in the WashPost):

  • Trump, backed by Jared Kushner and Ivanka Trump, settles on "Mooch" to head comms, largely because he likes the financier's feistiness defending POTUS on cable.
  • Trump doesn't consult his senior aides. They flip out, both because of personal grievances with Mooch, and their belief that heading White House comms requires Washington skills and experience. Some staff learns about the move when Axios' Jonathan Swan pops the story Thursday night.
  • In a 10 a.m. meeting, chief of staff Reince Priebus, chief strategist Steve Bannon and press secretary Sean Spicer object vehemently. Trump ignores them.

  • Spicer quits ("the last straw," a source close to Spicer told me), drawing applause when he graciously tells his staff he wants Scaramucci to have a clean slate.
  • Scaramucci goes to the podium in the White House briefing room and announces that Sarah Huckabee Sanders (daughter of Mike Huckabee), who has been Spicer's top deputy, will be press secretary.
  • Asked by ABC's Jon Karl about the time on Fox Business in 2015 that he called Trump "another hack politician," Scaramucci parries: "[H]e brings it up every 15 seconds, OK? (LAUGHTER) ... So, Mr. President, if you're listening, I personally apologize for the 50th time for saying that."

Phew. As Spicer told Fox's Sean Hannity last night (not as a quip, but as part of an argument about working tirelessly to advance Trump's agenda): "We had a very successful Made in America week this week, garnering over millions of impressions."

Some atmospherics from all-terrain Jonathan Swan:

  • Trump thought Mooch killed it. He was pumped about it.
  • Very bipolar West Wing. Source tells me Reince's people seemed "kind of freaked" about what happened. And certainly in the dark.
  • They were trying to spin the new narrative that Reince and Anthony are BFFs and that Reince was "100%" supportive of Trump making Mooch comms director. The President would laugh if you told him that.
  • Jared, Ivanka and Hope Hicks were all pushing for Mooch and very happy with it.
  • Bannon went in hard, lost badly but seemed to have moved on very quickly. Doesn't want to dwell on it.
  • What we're watching: Will Mooch add to the team, and possibly some unexpected names from outside of politics?
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What Trump's tweeting after a week of WH leaks

Pablo Martinez Monsivais / AP

President Trump knows how to use Twitter to his advantage, particularly when he wants to control the news narrative. After Press Secretary Sean Spicer abruptly resigned yesterday following Anthony Scaramucci's appointment as communications director, the news about the White House only got worse.

The Washington Post dropped a late-evening story claiming Attorney General Jeff Sessions — who Trump had dismissed earlier in the week, saying he wouldn't have hired Sessions if he had know he'd recuse himself from the Russia investigation — had discussed campaign-related issues with Russian Foreign Minister Sergei Kislyak during the 2016 election. Later, reports surfaced that the House Intelligence Committee (in addition to the Senate Intelligence Committee) is now inviting Jared Kushner to testify on Tuesday regarding the Russia probes. And, new reports detailed Kushner had failed to disclose more than 70 assets in his security clearance forms and that Ivanka Trump is benefiting financially while she serves in the administration.

Here's what President Trump has decided to focus on this morning:

  • "ObamaCare is dead and the Democrats are obstructionists, no ideas or votes, only obstruction. It is solely up to the 52 Republican Senators!"
  • "The Republican Senators must step up to the plate and, after 7 years, vote to Repeal and Replace. Next, Tax Reform and Infrastructure. WIN!"
  • "In all fairness to Anthony Scaramucci, he wanted to endorse me 1st, before the Republican Primaries started, but didn't think I was running!
  • "My son Donald openly gave his e-mails to the media & authorities whereas Crooked Hillary Clinton deleted (& acid washed) her 33,000 e-mails!"
  • So many people are asking why isn't the A.G. or Special Council looking at the many Hillary Clinton or Comey crimes. 33,000 e-mails deleted? ... What about all of the Clinton ties to Russia, including Podesta Company, Uranium deal, Russian Reset, big dollar speeches etc."
  • "While all agree the U. S. President has the complete power to pardon, why think of that when only crime so far is LEAKS against us.FAKE NEWS."
  • "This morning I will be going to the Commissioning Ceremony for the largest aircraft carrier in the world, The Gerald R. Ford. Norfolk, Va."
  • "The Failing New York Times foiled U.S. attempt to kill the single most wanted terrorist,Al-Baghdadi.Their sick agenda over National Security."
  • "A new INTELLIGENCE LEAK from the Amazon Washington Post,this time against A.G. Jeff Sessions.These illegal leaks, like Comey's, must stop!"
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Dems want to rebrand as the economic party

Senate and House Dems, after an intensive process spanning seven months, on Monday will unveil a new economic agenda, Axios has exclusively learned, meant to counter the perception that Democrats are only the anti-Trump party, with no message of their own.

Top Dems see the new message as the key to turning things around after their losses in the presidential race and this year's House special elections.

An opening theme/frame: "excessive corporate power and its impacts."

Pollster Geoff Garin writes in a memo kicking off the project: "[T]he Democratic policies related to curbing excessive corporate power that are being highlighted in the first day of the rollout have real resonance with voters and are strongly supported by a significant majority of Americans."

The agenda's big idea: "Too many families in America today feel that the rules of the economy are rigged against them. Special interests have a strangle-hold on Washington — from the super-rich spending unlimited amounts of secret money to influence our elections, to the huge loopholes in our tax code that help corporations avoid paying taxes."

"If the government goes back to putting working families first, ahead of special interests, we can achieve a better deal for the American people that will raise their pay, lower their expenses, and prepare them for the future."

See Garin's two-page memo.

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Jared Kushner to testify before House Intelligence Committee

Susan Walsh / AP

Jared Kushner's testimonies about his potential ties to Russian officials just increased: he will now testify before the House Intelligence Committee on Tuesday, July 25, the committee announced last night. And Kushner's lawyer confirmed to ABC News that he will cooperate with their request for questioning.

This comes just days after news broke that Kushner (along with Donald Trump Jr. and Paul Manafort) were asked to testify in front of the Senate Intelligence Committee next week. Kushner's Senate hearing is on Monday.

Why this matters: Kushner is the first member of Trump's inner circle to face questioning in the ongoing Russia probes, and the additional testimony suggests both committees have questions about a number of things — his failure to disclose the June 9 Trump Jr. meeting, as well as issues with his security clearance forms (his revisions to them have retroactively revealed contacts with more than 100 people tied to foreign governments).

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The companies that dominate Chinese internet

While companies like Google, Amazon and Facebook are favored by most of the world, they are blocked in China. There, the titans of the internet are Alibaba and Tencent. Below are some of the most popular social platforms in China and their U.S. equivalent.

WeChat

  • U.S. equivalent: Facebook Messenger
  • Parent Company: Tencent — one of the two major companies in China.
  • # of users: 938 million (compared to 2 billion for Facebook)
  • Details: WeChat is the most popular messaging app in China, similar to iMessage, Facebook Messenger or WhatsApp.


Weibo

Baidu

  • U.S. equivalent: Google
  • Parent company: Baidu
  • # of users: 665 million active mobile users last December
  • Details: Baidu was the first Chinese company to be included in the NASDAQ-100 index. Microsoft is currently teaming up with Baidu to work toward autonomous cars.

Alibaba

  • U.S. equivalent: Amazon, Walmart
  • Parent company: Alibaba
  • # of users: 454 million over all three properties — Alibaba.com, Taobao and Aliexpress. (Amazon has 65 million users who have bought Prime memberships.)
  • Details: Alibaba, founded by Jack Ma, is the 6th largest retailer in the world and the only foreign retailer to make it into the top 10, according to Forbes. Alibaba.com focuses on businesses, connecting suppliers and buyers all over the world, while the company also owns online shopping companies Taobao and Aliexpress which oversees purchases by public consumers.

Taobao

  • U.S. equivalent: Amazon, Ebay
  • Parent company: Alibaba
  • Stats: 40 categories of goods, buyers and seller send 100,000 messages on a daily basis.
  • Details: Taobao was founded 4 years after Alibaba.com is a consumer-to-consumer retail website, similar to Ebay or Craigslist.

Tmall

  • U.S. equivalent: Amazon
  • Parent company: Alibaba
  • # of users: 100 million in 2013
  • Details: Tmall allows brands to sell their products to consumers online and is the most popular B2C business in China.

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Report: Sessions talked Trump campaign matters with Russian ambassador

Susan Walsh / AP

Jeff Sessions discussed campaign-related matters with Russian Ambassador Sergei Kislyak during the 2016 U.S. presidential campaign, including policy issues important to the Russian government and the potential relationship between the Russian government and a Trump administration, according to current and former U.S. officials, The Washington Post reports.

The evidence: This report is based on U.S. intelligence intercepts of Kislyak's accounts of two conversations with Sessions, who was a foreign policy advisor to Trump at the time of the alleged conversations.

One big caveat: Russia is known to create false intelligence reports to sow confusion in the U.S., and Kislyak may have exaggerated his meetings.

One U.S. official said that when Sessions testified that he had no recollection of an April encounter with Kislyak, he was giving "misleading" statements "contradicted by other evidence."

  • Sessions in March when he recused himself from the Russia probe: "I never had meetings with Russian operatives or Russian intermediaries about the Trump campaign."
Why it matters: Recent reports have shown that Trump is irritated with Sessions for recusing himself from the probe in the first place.
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Some parts of GOP health bill violate Senate rules

Andrew Harnik / AP

The Senate parliamentarian ruled Friday that some parts of the Senate health care bill do not comply with budget rules, meaning that if they're included in the bill, they'll need 60 votes to pass. (They won't get 60 votes.)

The biggest provisions that will have to come out if the Senate follows past precedent: Planned Parenthood defunding, abortion funding restrictions, and funding for insurer cost-sharing payments. However, one of the most controversial amendments of the bill, Sen. Ted Cruz's Consumer Freedom Act, wasn't included in her ruling, as it only addressed an earlier version of the bill that didn't include it.

The big things she said don't comply:

  • The provision barring Planned Parenthood from receiving Medicaid funding for a year
  • The language preventing premium tax credits from being used for plans that cover abortion
  • Funding for insurer subsidies, known as cost-sharing reduction subsidies
  • The six-month waiting period for the individual market for people who haven't maintained continuous coverage
What's still under review:
  • Enhanced waivers for some Affordable Care Act regulations
  • A provision allowing small businesses to establish association health plans
  • The provision allowing insurers to charge older people more than younger people compared to the ACA
  • The option for states to receive a block grant instead of a per-person funding cap