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Illustration: Sarah Grillo/Axios

A Trump administration official tells Axios that the cyberattack on the U.S. government and corporate America, apparently by Russia, is looking worse by the day — and secrets may still be being stolen in ways not yet discovered.

The big picture: "We still don't know the bottom of the well," the official said. Stunningly, the breach goes back to at least March, and continued all through the election. The U.S. government didn't sound the alarm until this Sunday. Damage assessment could take months.

Microsoft President Brad Smith told the N.Y. Times that at least 40 companies, government agencies and think tanks had been infiltrated.

  • The hack is known to have breached the departments of Defense, State, Homeland Security, Treasury, Commerce, and Energy and its National Nuclear Security Administration — plus the National Institutes of Health.
  • 8 countries: Microsoft, which has helped respond to the breach, said in a statement that 80% of its 40 customers known to have been targeted are in the U.S., plus others in U.K., Israel, UAE, Canada, Mexico, Belgium and Spain.

In unusually vivid language for a bureaucracy, the U.S. Cybersecurity and Infrastructure Security Agency, part of Homeland Security, said yesterday that the intruder "demonstrated sophistication and complex tradecraft."

  • The agency said the breach "poses a grave risk to the Federal Government and state, local, tribal, and territorial governments as well as critical infrastructure entities and other private sector organizations."

If this had been a physical attack on America's secrets, we could be at war.

  • Imagine if during the Cold War, the Soviet Union had broken into a building in Washington and walked out with correspondence, budgets and more.
  • Sen. Chris Coons (D-Del.) told Andrea Mitchell on MSNBC: "It's pretty hard to distinguish this from an act of aggression that rises to the level of an attack that qualifies as war. ... [T]his is as destructive and broad scale an engagement with our military systems, our intelligence systems as has happened in my lifetime."

The gravity wasn't immediately apparent because this wasn't the "cyber Pearl Harbor" that experts have warned about: No one took out a power grid, or stole a bunch of money or destabilized the markets.

  • Instead, it's more like someone has been walking in and out of your house for months, and you don't really know what they took.
  • And they may have built a secret door. "For someone to have access that long, who's this sophisticated, it's pretty likely they built other ways to get in that are hard to find," one official told me.

What's next: President Trump has stayed silent on the hack, meaning that President-elect Biden's overflowing in-box now includes Russian reprisal, damage mitigation and future deterrence.

  • Promising to impose "substantial costs" on the perpetrator, Biden said in a statement that his administration "will make cybersecurity a top priority": "I will not stand idly by in the face of cyber assaults on our nation."
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Go deeper

DHS warns of "heightened threat" because of domestic extremism

Supporters of former President Trump protest inside the U.S. Capitol on Jan. 6. Photo: Roberto Schmidt/AFP via Getty Images

The Department of Homeland Security on Wednesday issued an advisory warning of a "heightened threat environment" in the U.S. because of "ideologically-motivated violent extremists."

Why it matters: DHS believes the threat of violence will persist for "weeks" following President Biden's inauguration. The extremists include those who opposed the presidential transition, people spurred by "grievances fueled by false narratives" and "anger over COVID-19 restrictions ... and police use of force[.]"

Updated Jan 28, 2021 - World

Biden reviews U.S. arms deals with Saudi Arabia and UAE

Trump struck several large arms deals with Mohammed bin Salman (L) and Saudi Arabia. Photo: Kevin Dietsch-Pool/Getty Images

The Biden administration has put on hold two big arms deals with Saudi Arabia and the United Arab Emirates which were approved in the final weeks of the Trump administration, a State Department official told Axios.

Why it matters: The sales of F-35 jets and attack drones to the UAE and a large supply of munitions to Saudi Arabia will be paused pending a review. That signals a major policy shift from the Trump era, and may herald sharp tensions with both Gulf countries.

Jan. 6 panel subpoenas 2 far-right "America First" activists

The House panel investigating the Capitol riot, from left; Reps. Bennie Thompson, Liz Cheney, Adam Kinzinger and Jamie Raskin on Capitol Hill in December. Photo: Drew Angerer/Getty Images

The House select committee investigating the Capitol riot issued subpoenas Wednesday for far-right leaders Nick Fuentes and Patrick Casey, who allegedly encouraged followers to go to D.C. and challenge the 2020 election results.

Why it matters: The action underscores the panel's increasing focus on rallies held ahead of the Capitol attack and how extremists were drawn to former President Trump's baseless claims of widespread voter fraud, per the New York Times.