Tuesday, December 21, 2010

The Most Important Weapon Against Terrorists

RAND's study of Al Qaida in Iraq's finances is out today with some interesting findings:
This monograph analyzes the finances of the militant group al-Qa'ida in Iraq (AQI) in Anbar province during 2005 and 2006, at the peak of the group's power and influence. The authors draw on captured documents that give details on the daily financial transactions of one specific sector within Anbar province and of the financial transactions of the AQI provincial administration. Some of their conclusions are: AQI was a hierarchical organization with decentralized decisionmaking; AQI in Anbar was profitable enough to send substantial revenues out of the province in 2006; AQI relied on extortion, theft, and black market sales to fund its operations in Anbar; AQI needed large, regular revenue sources to fund its operations, but its administrative leaders did not hold much cash on hand. The authors' interpretation of data on compensation practices and participants' risk of death indicates that AQI members were poorly compensated and suggests that they were not motivated primarily by money to join the group. The authors also find that mounting attacks required organizational expenditures well beyond the cost of materiel used in attacks. One major conclusion is that disrupting AQI's financial flows could disrupt the pace of their attacks.
While the criminal operations provided the operational means for AQI, it appears that personal monetary gain for AQI members was not a contributing factor for participation. At least, AQI didn't pay its members very much out of a collected treasury. This should not be read to discredit the idea that AQI members actively did seek monetary rewards on top of the amounts they collected on the street via protection rackets before sending the money up the ladder. AQI criminal activity was not central to the organization's recruitment strategy, but the possibility of leveraging connection with AQI into personal revenue probably did not escape criminally-inclined AQI members.

Secondly, financial disruption of terrorist networks is a law-enforcement strategy, not a warfare strategy. The targeting of financial networks is used in attacking organized criminal groups (see: RICO statute) from local gangs to international cartels. Hopefully policy makers beef up the ability to fight terrorism through the same methods that have been relatively successful in dampening other criminal ventures. Attaching an operational cost to money transfer effectively brings down the operating budget of a terrorist network, so making its financial transactions more difficult or uncertain would weaken a terrorist groups ability to stage attacks. Obviously, freezing terrorist assets is less likely to cause irreversible harm to innocent civilians than drone strikes. That said, the maintenance of a militia force creates serious operational costs above and beyond normal costs-of-living when the militia requires safe houses, disguises, etc... that are involved in avoiding detection by an active policing effort. Effective law enforcement practices create the need for robust financial networks, and disrupting access to finances creates problems for terrorist organizations.

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