As principal architect behind an online trading firm, I brought it to the attention of a contact with the NSA that code inspected only by Chinese national managers and developed by a Chinese development organization at abnormally low rates was being connected directly into the US trading infrastructure with direct access to more than $2B in assets under management and nearly unrestricted buying power.
As a consultant and principal architect at a smart grid meter manufacturing company, I shared with my NSA contact that the core chipset handling crypto resolution, wireless uplink, and zigbee for both residential and commercial meters was being designed and manufactured in China with little US oversight.
Regardless of whether you are speaking of department of defense or other public sector technology projects or private sector technology projects which tie to critical strategic infrastructure, security is and has been compromised by outsourcing.
Further, even the most base logic demonstrates that it is futile to expect your enemies to provide for your security. We've compromised our independence and autonomy, lost the competitive edge in any meaningful way, and seem to be under the mistaken impression that China is anything other than an opportunistic hegemony. The security of any nation which allows for lowest cost bidders using external third parties for development, implementation, or administration without regulation, inspection, or validation will be compromised.
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