The Economics of Terror

Americans aghast at $3 and probably soon $4 a gallon gasoline are learning a lesson in the economics of terrorism.
Terrorism has become an economic activity in today’s world as the ever increasing price of oil demonstrates. Oil prices are increasing because terrorists have succeeded in disrupting the oil fields in Iraq and Southern Nigeria. Americans are well aware of the war in Iraq but not of the Nigerian conflict which is fast becoming a reprise of Iraq.
The economic strategy of the terrorists is a simple one first they sabotage or destroy the oil fields to limit the supply of oil. Then they divert large amounts of oil and sell it on the black market to finance their cause.
Sabotaging the oil fields aids the terrorists in two ways. First it undermines the enemy. Second it increases the price of oil making that commodity more valuable on the black market and oil smuggling more profitable.
The terrorists now have a tremendous incentive to continue their war the increased price of oil and the means to finance it. It goes without saying that oil rich Arab countries like Saudi Arabia now have two reasons to support terrorist insurgents in Iraq, religion and money. They do their religious duty by financing the fight against the infidel while fattening their bank accounts by increasing the price of oil at the same time.
A similar conflict is taking place in Southern Nigeria, in that oil rich region local tribes who have been in conflict with the Central government for decades have suddenly discovered the capability to sabotage the oil field and defeat Nigeria’s army and western mercenaries who protect the oilfields on the battlefield. Now its obvious that the rebels in Southern Nigeria couldn’t develop these capabilities without outside help. There is also only one reason for this aid to drive up the price of oil so other oil rich countries and their rulers can increase their oil profits.
This is a frightening pattern and one I fear we will see repeated elsewhere quite likely in Mexico, Colombia and Venezuela. Venezuela seems particularly ripe for this kind of violence, leftist lunatic Hugo Chavez is President but I’m sure there will be grumbling. My guess is it wouldn’t be too hard to organize dissatisfied elements in Venezuela into some sort of right wing terror group to fight Chavez’s Godless Communism. Their target would be the oil fields which finance Chavez’s comic opera revolution and supply lots of oil to the US. The US could be drawn into this conflict American soldiers could find themselves defending Chavez’s crackpot regime against anticommunist forces to keep the oil flowing.
Most frightening the economics of terror is not just confined to oil, the feared Tamil Tigers terrorists in Sri Lanka are now deploying airplanes to disrupt that nation’s tourist economy. In Afghanistan, the opium trade fuels the Taliban drug eradication efforts push poor farmers whose only cash crop is opium into the terrorists hands and give the terrorists funds to continue the war. In Colombia, right wing death squads and Marxist guerrillas keep up the now meaningless struggle of the Cold War to get their hands on the profits of the drug trade. The former Communist guerrillas are now little more than paid mercenaries in the employ of drug lords and Big Oil.
Since the profits to be made from Economic Terrorism are immense, I imagine it is here to stay for the foreseeable future. The question is how do we combat it? I really don’t know, I do know one thing traditional military forces tactics have failed and failed miserably to combat this menace in Iraq. Something new will be required, I don’t know what but I fear it will be private armies in the pay of large corporations.