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Monday, April 10, 2006

JOURNAL: Competing with States

A good way to view large terrorist organizations is as virtual states. They generate income from the transnational criminal economy and use terrorism as a method of warfare. They only thing they don't control (for long) is territory, although this is more of a blessing than a curse. The question, at least to me, is: can virtual states can compete on the same scale as states? The conventional wisdom says NO, that only states have the resources necessary for protracted conflict (notice the attempts to blame Iran and Syria for the bulk of the problems in Iraq). I think that this is not only a wrong assumption, it is dangerous.

Here's why. Not only do virtual states have access to an increasingly effective means of warfare (open source warfare and system disruption) that provide them excessive amounts of leverage (ROIs on attacks -- impact/cost -- of up to 250,000x), they can also generate incomes that exceed the free cash flow of all but the largest of states (with very little of the overhead). For example:

Manhattan District Attorney Robert Morgenthau has shut down a massive terror-finance pipeline... Evidence developed in the course of a three-year probe, which has already resulted in charges against other New York-based financial institutions, revealed that about $3 billion that flowed through the account over a two-year period was going to terror groups Hamas, al Qaeda and Hezbollah, Morgenthau said.

He said most of the $3 billion in suspicious funds were generated, through criminal enterprises, in the lawless tri-border region of Brazil, Argentina and Paraguay. Over a two-year period, the $3 billion was sent to the New York bank account (at Bank of America) by a shadowy money-transmittal company in Montevideo, Uruguay. The money then flowed into bank accounts in the Middle East locations including Riyadh, Saudi Arabia, Beirut, Lebanon, and Ramallah in the Palestinian territories.

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John Robb quoting New York Post Online Edition >"...most of the $3 billion in suspicious funds were generated, through criminal enterprises, in the lawless tri-border region of Brazil, Argentina and Paraguay..."

Ah ha !

Our "old friend" Rev. Sun Yung Moon`s territory

King of Peace indeed; "de raffier" to some Nostradomus fans

"No place is so strongly fortified that money could not capture it." - Marcus Tullius Cicero

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