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Maybe “they” were happy to have China do the dirty work and take the fall, but it was all conceived and execute by “them.”

I think its pretty clear from context that "they" refers to the intelligence agencies of the US government.

Oh there is no confusion over who we are referencing.

In this case, maybe using a software or firmware virus could be a better way? Easy to install, easy to remove, leaves no evidence if be careful.

This got me thinking, why plant a chip? I mean, it's hard to make, and will almost certainly be caught.

Hardware stays put, even very targeted viruses don't as evidenced by stuxnet.

That theory would explain a lot