Politics & Policy

Driving Bin Laden?

Oil consumption has little to do with terrorism.

When you drive alone, do you drive with bin Laden? A growing number of foreign policy analysts seem to think so, and the president himself said as much in an interview with CBS News anchor Bob Schieffer a few days before his much-ballyhooed “State of the Addiction” speech to a joint session of Congress. Unfortunately, the widespread belief that conservation and alternative fuels will cripple Islamic terrorism is wishful thinking.

The fundamental problem with the argument is that terrorists don’t need oil revenues. The fact that catastrophic terrorism can be undertaken on the proverbial dime (a few hundred thousand dollars paid for the 9/11 attacks) suggests that choking off financial resources to al Qaeda effectively is a hopeless task.

Further evidence of the unimportance of money to terrorism is the absence of a correlation between Persian Gulf oil revenues and terrorist activity. Oil prices and profits during the 1990s were among the lowest ever seen in history. But the 1990s also witnessed the worldwide spread of Wahabbi fundamentalism and the coming of age of al Qaeda. Note too that Islamic terrorists in the 1990s relied upon help from state sponsors such as Sudan, Afghanistan, and Pakistan–nations that aren’t exactly known for their oil wealth or robust economies.

So terrorists don’t rely on oil revenues. What terrorists need most is a recruiting pool from which to draw. Question: how do you suppose the Muslim world would react to a U.S. policy that had the stated intention of impoverishing Muslims in suspect parts of the world? Lower oil profits, after all, mean smaller state payments to young, underemployed Muslims and a less robust economy.

To the extent that deteriorating economic conditions breed social discontent and political resentment (which could easily be blamed on the United States), “starving the oil beast” might well increase the recruitment pool for al Qaeda and invite producer states to reconsider their allegiances in the war on terror. Even though our purchase of oil from some countries does prop-up some truly pathological regimes, cutting back on oil consumption might produce even more pathological regimes.

Reducing oil revenue to noxious regimes This might be a risk worth taking if billions were finding their way from such regimes into al Qaeda coffers, but that seems unlikely. Everything we know suggests that al Qaeda terrorist cells are “pay as you go” operations that primarily engage in garden-variety crime to fund their activities. Given that the governments of Saudi Arabia, Kuwait, and others in the region are slated for extinction should bin Laden have his way, those governments have no interest in facilitating the transfer of oil revenues to some post office box in Pakistan.

Producer states do use oil revenues to fund ideological extremism, and Saudi financing of madrassas is the primary case in point. But given the importance of that undertaking to the Saudi government (it was instituted, after all, to defend the House of Saud’s position of leadership in the Islamic world in response to criticism from radical Shiites from Iran), it’s unlikely that the Saudis would cease and desist simply because profits were down. They certainly weren’t deterred by meager oil profits in the 1990s.

So cutting back on oil consumption would most likely not cut back on terrorism. But wouldn’t a cutback reduce the need for a military presence in the Persian Gulf? No, because there is no need for a U.S. military presence in the Gulf regardless of the amount of oil we import.

It’s certainly true that a disruption of the oil supply from the Middle East would increase the price of crude oil everywhere in the world. But just because the security of Middle Eastern oil has the characteristics of a public good for all consumers in the world does not imply that the United States has to provide that security. Oil producers will provide for their own security needs as long as the cost of doing so is less than the profit they gain from the oil trade. Given that their economies are so heavily dependent upon oil revenues, they have even more incentive than we do to worry about the security of production facilities, ports, and sea lanes. And if producing countries provide inadequate security in the eyes of consuming countries, consuming countries can pay producers to augment it.

In short, whatever security our presence provides (and many analysts think that our presence actually reduces security) could be provided by other parties were the U.S. to withdraw. The fact that Saudi Arabia and Kuwait paid for 55 percent of the cost of Operation Dessert Storm suggests that keeping the Straights of Hormuz free of trouble is certainly within their means. The same argument applies to al Qaeda threats to oil production facilities.

It’s no surprise that the political class has convinced itself that bigger handouts to farmers and more automobile regulation constitute a “secret weapon” in the war against bin Laden. It is a surprise, however, that so many otherwise serious people are willing to believe them.

Jerry Taylor and Peter Van Doren are senior fellows at the Cato Institute. Peter Van Doren is also editor of Cato’s Regulation magazine.


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