Titan Rain: Scary as it Gets

Are Chinese cyberspies massively hacking US government and military networks? Perhaps. Read this. Then read Richard Bejtlich's take on it.

The theory that the Chinese government is behind this campaign seems very plausible. China has a well documented history of espionage, going back more than 2,000 to the time of Sun Tzu. If you're interested, I'd recommend The Seven Military Classics of Ancient China, Including The Art of War and (far more recently), The Tao of Spycraft: Intelligence Theory and Practice in Traditional China.