Via the WFB, Panetta is really sounding the alarm on this recently; at a speech on Wednesday, he warned not only of the degrading effect of the pending spending cuts on military readiness, but also spoke about cyberspace as the new frontier on which the United States will increasingly need to do battle in the 21st century.

“We are literally the target of thousands of cyber attacks every day — every day,” Panetta said in remarks at Georgetown University. “Thousands of cyber attacks that are striking at the private sector, strike at Silicon Valley, strike at other institutions within our society, strike at our government, strike at the Defense Department and our intelligence agencies.”

“Cyber is now at a point where the technology is there to cripple a country,” he continued, “to take down our power grid system, to take down our government systems, take down our financial systems, and literally paralyze the country. That is a reality.”

China and other foreign cyber attackers’ e-belligerence isn’t new, but it’s definitely been growing in momentum over the past few years, with attacks focusing on major companies, government departments, and financial institutions — and it isn’t even just countries like China we need to be worried about.

The US Federal Reserve bank has confirmed one of its internal websites was broken into by hackers after the hacktivist group Anonymous was claimed to have stolen details of more than 4,000 bank executives.

“The Federal Reserve system is aware that information was obtained by exploiting a temporary vulnerability in a website vendor product,” a spokeswoman for the US central bank said.

“Exposure was fixed shortly after discovery and is no longer an issue. This incident did not affect critical operations of the Federal Reserve system,” the spokeswoman said, adding that all individuals affected by the breach had been contacted.

Last month, the Pentagon announced their plans to beef up their cybersecurity forces by more than 4,000 people; and while there’s plenty of concern that the Obama administration needs to increase transparency as they grow their resources and strengthen their own capabilities for offensive cyber attacks, there’s also still the concern that they aren’t doing nearly enough to safeguard our cyber security and that China has been allowed to get away with their shenanigans scot-free for too long, via Liz Peek at the Fiscal Times:

Mr. Panetta’s speech came in response to stepped up attacks on U.S. financial institutions, as well as on the state oil companies of Saudi Arabia and Qatar. He warned that foreign cyber actors are probing our critical infrastructure, creating “tools to attack these systems and cause panic and destruction and even the loss of life.” His comments were also intended to drum up support for a comprehensive bill, like the Cybersecurity Act of 2012, which failed to pass Congress. So urgent was the need to regulate information sharing and establish liability limits, according to Panetta, that the president might issue an executive order if Congress failed to do its job.

Industry insiders say President Obama will indeed unleash that mighty executive sword on cyber crime – soon after the State of the Union address. Only instead of Excalibur, expect something in the way of a pen knife. Mr. Obama will apparently call for several changes in the way we manage and respond to cyber attacks, some of which were embedded in the failed bill.

Sadly, most who have considered the likely proposals – like Lawrence Ponemon, whose eponymous firm consults on and researches cyber security — say the likely fixes “may make us feel good as a country but they won’t have much impact.” That reasonable skepticism is fed in part by the federal government’s repeated failures to protect even its own operations. (Among other agencies, the CIA, the Department of Defense, the Department of Commerce, the Department of Homeland Security and the National Nuclear Security Administration have been hacked, leading to the theft of secure information and widespread disruptions.)

Anyhow, it’s looking increasingly likely that this will all come under the command of Chuck Hagel in short order — the Senate vote on his confirmation is currently scheduled for Thursday.