Al Qaeda, Adam Smith and the Arabian Revolutions

What is the connection between Al Qaeda and Adam Smith? Absolutely nothing, at first glance. While the former is a ruthless terrorist organization responsible for the deaths of countless innocent people, the latter is a highly respected and scholarly person who is widely considered to be the founding father of free market economics. But if we actually think about it, we realize that Al Qaeda has, inadvertently so, been following Adam Smith’s principles of a free market economy.

In the last few years, thanks to the relentless drone strikes and global pressure on terrorist havens like Pakistan, Al Qaeda has been significantly weakened. Being constantly on the run, without having any safe sanctuary except in the Pakistani Wild West, Al Qaeda has not been able to launch any successful terrorist attack on any nation. However, they have fostered a spirit of “entrepreneurship” among their radical followers. Like in a free market economy, there is not much “central planning” and “state/central intervention” in the “framing of policies”; rather the “center/state” has created conditions for the “blooming of private enterprise”. That is to say that, though there is no organizational level planning from the Al Qaeda central leadership with regards to terrorist strikes, their vitriolic messages of hate have encouraged and influenced a host of small time morons to take up arms for delusional causes. This is clear in the recent attacks: the Nigerian Underpants bomber, the Times Square bomber and the parcel bombs from Yemen. These were all low cost and unorganized missions put together by a bunch of wannabe terrorists. But it is precisely these kind of attacks that become hard to detect and will increase panic and unrest in an already scarred society. Eg: the TSA pat downs at US airports.

The only way to prevent such attacks is to remove the deep rooted causes that fuel such hatred. But this is easier said than done. Top on the list of grievances is the Israel-Palestine issue, which shows no signs of heading towards a peaceful resolution. Another major cause for concern in the Islamic/Arab world is the US and Western support for oppressive military dictators. These despots, hated by their own people, are staunch allies of the US. When they fall, as all despots eventually do, the people turn their resentment towards the global allies of the tyrants i.e US and Europe. This is what happened in Iran and indirectly influenced the Al Qaeda.

In 1953, a US supported coup brought back the ousted Iranian Shah to power, much to the chagrin of the Iranian people. When the Shah was ousted in 1979, the Iranians fearing another US coup attacked the US embassy and held the diplomats hostage for 444 days. An incensed US supported Iraq in the following Iran-Iraq war, funneling weapons and money to Saddam Hussein. A power hungry Saddam then attacked Kuwait in 1991. The US intervened and threw him out of Kuwait, but stationed troops in the Arab countries as a counter to Iraqi imperialist ambitions. This presence of US troops and their support for the autocratic Arab regimes gave fuel to the newly jobless Mujahideen created by another US backed dictator: Zia Ul Haq.

As we can see, this has been a vicious cycle of violence. To win this war on terror, we can’t just be content with dismantling one or two organizations. Al Qaeda is still a dangerous if somewhat diminished threat. The world needs to make a cohesive effort to address the root causes that make educated urban youth in US, UK and even India to propagate violence against innocents. The recent revolutions in the Arab world has left the US and the western world in a bind. Should it support its dictator friends for the sake of stability or support the people and risk radical fanatic political parties coming to power? I think the world needs to support democracy and the freedoms of people in the Arab world. Only this would lead to stability and peace in the coming century.


10 responses to “Al Qaeda, Adam Smith and the Arabian Revolutions

  1. This is definitely proof that “the enemy of my enemy” is NOT my friend. You’ve inspired me to make an Adam Smith related post in the near future. Also, what actions do you think would address the root causes of these “wannabe terrorists”? Since many are usually educated and financially stable individuals, poverty doesn’t serve as a target for us to blame for their behavior.

    • The current problem with these moderate educated youth is that they suffer from a “victim complex”. They feel that they or their brethren in other countries are victims of “western imperialism” and this leads them to hardcore religious fanatics who brainwash them into taking up arms. Curbing such mindsets require political solutions rather than military ones. However this is not easy. There needs to be lasting peace in the middle east. The Iraq war only compounded the feelings of “us vs them”. I think it would take another ten to fifteen years before there is peace in the middle east through political solutions and the threat of terrorism is reduced.

  2. Yes, there is a parallel with Adam Smith, but it is a malign one. The stateless State of al Qaeda has created a malign environment, in contrast to the benign one of Adam Smith, for the sprouting of “delusional causes” to be taken up by the fanatical votaries and followers of the moronic chase of the seventy-two virgins. But that is as far as the parallel goes.

    I also think it is incorrect to confuse the goals of a fanatical religious hate movement that are propelled by the concept of Allahu Akbar with the political “grievances” that you identify. The latter is a fig leaf behind which the Islamists attempt to cover their real intentions.

    • You are absolutely right when you say that political grievances “is a fig leaf behind which the Islamists attempt to cover their real intentions”. But this is for the hardcore fanatics. The question is, what makes young educated people like the Times Square bomber and the 7/7 london bombers take up violence? They are not the hardcore religious fanatics. They are simply influenced by the political situation and “assumed grievances”. This sets them on a dangerous path where they align with said religious fanatics and get indoctrinated with hate. The way to cut off this oxygen supply to the fanatics is by having political solutions to current problems. True, that even after the Israel Palestine issue is resolved, Al Qaeda will not change its intentions. But, it will take away one reason for moderate educated youth to feel that there is only injustice happening and that the way to resolve it is through violence. Political solutions will not deter hardcore terrorists, but it will remove the sympathies that they may have among people. That would be a resounding victory in itself.

  3. One common thing which I noted in your post is the mentioning of US over and over again. The reasons behind US support to those countries were driven by anything but rationalism.It is purely for their own benefit. In that sense the Iraq issue came back to bite them.I feel that they were in Afghanistan for cheap oil.All they are concerned about is to stay on as the most dominant country in the world which explains their fear for China now. Slowly but surely China is becoming a world super power.
    Now about the religious fanatics its mainly got to do with them being infused with hatred right from their childhood. Lot of camps in the name of religion teach kids hatred & misguide them by manipulating them. Something should be done to stop such things from happening.

    • I think lots of countries face issues like the US. For example: India. The Indira Gandhi govt initially supported Bhindranwale against the mainstream political parties like the Akali Dal. Bhindranwale soon grew into a dreaded terrorist and was indirectly responsible for Indira Gandhi’s assassination and directly responsible for the 10 years of militant violence in Punjab. India also initially supported the LTTE. RAW gave the LTTE training in arms and supplied them weapons in the late 70’s. But soon the LTTE turned around and assassinated the Indian Prime Minister Rajiv Gandhi. Pakistani backed mujahideen are now attacking Pakistan itself. All these are good lessons in geo-politics where it shows that allying with ruthless terrorist groups is like creating a Frankenstein monster. I mentioned only the US specifically because it has a central role in the current revolutions happening in the Arab world.

      Religious camps don’t explain the 7/7 or the Times Square bombers. These were young men who were brought up in cosmopolitan cultures with western education. They were not religious fanatics. They had never been to a madrassa till they got brainwashed into terrorism. What made them take up violence as a means to address their grievances? That is the moot question.

  4. Interesting and well argued post. The only aspect I would question is the assumption that regime change will bring democracy and freedom. There’s always a risk that countries oppresive regimes which have endured for decades will not be replaced by benign and stable ones. Depending on your point of view, you could argue that it didn’t happen after the Iranian Revolution, that it didn’t happen after the fall of the Soviet Union, and that so far stability has not come to Iraq. On the other hand most of the Eastern European countries succesfully transitioned from communism without much bloodshed.

    As for other countries in the Middle East, we’ll have to wait and see. People often confuse radical Islamism of the AQ variety with what is generally referred to as Wahabism. Although among some of the clerical establishments there are elements who would encourage or sympathise with AQ’s aims, the majority are, in my view, concerned with maintaining the status quo, not with turning the world inside out. And conservatism and fear of change are perhaps the mindsets we should be worried about in the long term. Check out my blog post on this at:

    • I think Russia is a lot more transparent and open than it was as USSR. Its also a more globalised economy now. True, it still has many many miles to go before it can claim to be a true democracy but its a start. Iraq was mis-handled. Again, the palestinian election a few years back brought the Hamas into power, which if allowed to rule freely might or might not have had a narrow-religious-fanatic rule. The point I was trying to make is that the USA, following its oft stated policy, must support people’s movements against dictators or at the very least, remain neutral. It must not repeat past mistakes of pro-actively propping up despots.

  5. Good article, but I don’t think you’ve succeeded in linking Smith to Al-Qaeda and its methods.

    There are two important aspects to Smith and the Wealth of Nations: The positive parts and the normative parts. Much of the Wealth of Nations is concerned with positive economics, which is based on a description of the real world. Smith analyzed how markets function and how people respond to incentives.

    Smith also focused on normative economics, which is policy prescription. He proposed policies that would enable individuals to pursue their self-interests (low taxation, low trade barriers, etc).

    When you say that terrorists groups like Al-Qaeda have adopted methods of carrying out low-cost attacks and an informal organizational structure, what you are describing is merely how individuals react to incentives. This has nothing to do with Smith, except insofar as he pointed out that people do, in fact, respond to incentives. But, then, every economist (whether free-market or not) knows this.

    In reality, what you are describing is fourth-generation warfare. In economic parlance, the transaction costs of running a top-down, hierarchical organization are far too high relative to the gains from exploiting a greater division of labor in the form of bottom-up, informally connected networks of small terrorist cells. This has no connection to free-market economics; it’s just human behavior.

    At any rate, I totally agree with the rest of your blog. We won’t solve the animosity against us until we stop giving them reasons to hate us.

    • You make some very valid points. In my article, I used Smith as a metaphor for free market economics where there are few restrictions on private enterprise and not much planning and direction from the government. The governments merely create environments conducive to the rise of such private enterprise. In such a scenario local industries bloom. Terrorism today seems to be following this analogy. Where there are no directions/planning/orders coming from the center (Al Qaeda or any other major terrorist organization), but it has created conditions conducive for the rise of militant extremism and indoctrination of youth (the 9/11 attacks, followed by the war on terror and the fostering of hundreds of extremist ideologues and their madrassas — none of which would be as successful in a pre 9/11 world) which has resulted in the rise of stand-alone terrorists from among the local populace which makes it all the more difficult to identify them in advance.

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