Market-Based Terrorism

Many experts have feared the death of Osama bin Laden might lead to retaliation by al-Qaeda on American interests. While there might be a grain of truth in this, observations on terrorist movements suggest such concerns might be overblown. At bottom, most radical movements are local and they only link themselves to the al-Qaeda global network because they desire al-Qaeda's funds and expertise. Once these local groups strengthen their position, more often than not, they actually do not enjoy working with al-Qaeda, which can be seen as both alien and threatening to their interests.

A crucial element in terrorism is the ability of groups and cells to enhance their operational capacity. They are frequently able to do this by linking to other, more powerful domestic or international actors. These groups aim to acquire political cover, financial assistance, and material support. As we know, states like Iran and Syria are major donors of global terrorism, as is al-Qaeda. Thus, al-Qaeda functions as a terrorist group, seeking to commit violent acts, in addition to its role as a sponsor to its various franchises worldwide. Osama bin Laden and al-Qaeda were jointly important because they could fund and train many local radicals. In Indonesia, for instance, as the police and the armed forces acquired a monopoly over illegal sources of revenues, such as extortion, illicit mining and fishing, and protection fees, local Islamic radicals have turned to other criminal activities, such as bank robbery, or donors from the Middle East, including al-Qaeda.

The history of Jemaah Islamiyah (JI) in Indonesia clearly reflects this. Originated in the repressive era of Suharto, members of JI escaped repression by moving to Malaysia or joining the war in Afghanistan during the 1980s. There, they made a connection with the more powerful, richer global jihad network al-Qaeda. After having made this connection, al-Qaeda became JI's primary source of support. Essentially, JI and al-Qaeda entered into a mutually agreeable informal transaction. JI received funding and other means of support in exchange for hitting targets that al-Qaeda deemed valuable.

After the fall of Suharto, with the state no longer as repressive as it used to be, radical groups became emboldened to take on a more assertive presence in Indonesia. And the ethno-religious conflicts between local Christians and Moslems in Maluku and Poso offered a ripe opportunity for them to do so. With the Indonesian state seemingly unable to stop the conflicts, the idea in some quarters that governing officials wouldn't lift a hand to help fellow Moslems in distress became popular. Some saw the Christians there as a part of global conspiracy, funded and armed by the United States, to undermine Moslems' interests everywhere.

JI eventually hopped into this mess, determined to show itself as a major player in terrorism. It joined the violence in both Maluku and Poso, thereby signaling to the outside world that the group existed, was active in the local jihad community, and thus should be assisted by the global jihadist network. Using the already established network between itself and al-Qaeda, Middle Eastern fighters soon played part in the conflicts under the name of Laskar Jundullah.

 9/11, however, changed the equation. The United States started to pay attention to the global financial transactions that funded the jihadists, pressuring the network. It also pressured the Indonesian government to start putting the clamps on JI.

At the same time, local developments worked against the group. JI's forced imposition of radical Islamic law on parts of the population made it unpopular. And the foreign elements within JI proved troublesome. They were unable to integrate smoothly within the local community, and the local jihadis resented the fact that they were seen as subordinates, second class foot soldiers in the movement. In the end, as Indonesians started to believe that the group was part of the global terrorist network, local jihadis saw the "foreigners" as a liability that effectively undermined their freedom of movement and action.

By the time the army decided to crack down on the violence, Indonesians were all too happy to rid themselves of the foreign jihadis and JI itself. With the conflict in Maluku winding down, and the conflict in Poso taking on a more local flavor, JI had to find other means to show that it was still relevant to the global network.Thus, it was not a coincidence that the notorious Bali bombings of 2002 occurred at that moment of crisis.

The picture of JI we just described lends consequential insight into how small and aspiring terrorist groups and cells operate, which in itself has been the subject of a large discussion among scholars and policy analysts. In short, it is apparent that at least some terrorist outfits seem to behave much like businesses do in market settings. That is, they have adopted the principles of firm survival and success and applied them to terrorism. Really, this is a form of market terrorism. And it makes sense, too, for terrorism is subject to many of the same pressures and constraints that businesses face--limited resources, imperfect information, the desire to survive, and intense competition for success.

Let's look at the logic of market terrorism. Small and medium-sized companies look for ways to demonstrate financial viability to attract prospective investors. Getting investors to buy-in to their products or ideas is important, for it can help these companies sustain themselves and possibly take them to another rung of success, leading to better brand recognition, more customers, more profit, and so on. In much the same way, terrorist groups and cells ostensibly look to demonstrate their violent capabilities--the hallmark of success in the terrorist world--to receive a buy-in from larger, well-financed and well-organized terrorist organizations. Such investments, which take the form of funds, weapons, training, political support, safe haven, and new recruits and followers, among other things, can enable these terror groups to become self-sustaining enterprises and make a name for themselves in the terror business.

Armed with this information, we have a better understanding of the relationship between al-Qaeda headquarters and its affiliates. Contrary to the conventional wisdom, the latter isn't necessarily wedded to the former's politico-religious ideology, nor is it particularly inspired to commit violence because of shared fundamentalist views. In fact, as the case of JI shows, there may quite a bit of disharmony in the relationship between the affiliates and their bases of support. More often than not, the affiliates are simply rational self-interested opportunists looking for support for local political and economic causes and ego-driven concerns. Should the main branch of al-Qaeda vanish from the scene, market forces would dictate that its affiliates look for alternative sources of assistance. And in this case, just as with JI, we would find these groups tailoring their messaging and activities around their new sponsor's goals and objectives.