http://www.informationclearinghouse.info/article30185.htm

Learn To Make Terror Your Friend

By Doug Casey

January 08, 2012 "Lew Rockwell" --  As you know, I think we're moving 
into an era of intense international conflict. And during the next 
ten years, you can plan your life around the US being in the middle 
of anything and everything that even vaguely resembles a war. It 
promises to be unpleasant, inconvenient and dangerous.

This article - which is long, but not nearly long enough to cover the 
subject in as much detail as it deserves - explains why military 
conflicts are in store, what they're going to be like and what might 
be the morality of the matter. This last has some importance, because 
we're talking in good part about terror. And, to paraphrase 
Nietzsche, you may not be interested in terror, but terror is 
interested in you.

A Matter Of Definition

In discussing any subject, I always like to begin with definitions of 
a few key words, especially words I hear people using in vague and 
nebulous ways. Sloppy definitions feed sloppy thinking, and they 
often disguise the fact that the speaker doesn't know what he's 
talking about. This is especially perverse in that it's often the 
case with words that have high psychological impact. "Terrorism" is 
absolutely one of the worst offenders.

There appear to be over 100 definitions of the word in use by 
different groups. I suspect one reason there's no commonly accepted 
definition is simply that the term has become so useful for people in 
power, at once a pejorative for enemies and a catch-all for 
prosecutors. The latter was demonstrated in the 2008 Liberty Dollar 
case, when a US Attorney characterized the issuance of the silver 
rounds as "a unique form of domestic terrorism."

Of course that's a ridiculous assertion that only a fool would make, 
but the rhetorical accusation places the accused in the same moral 
class as a child molester. In point of fact, though, what can be 
presented as terrorism to the popular mind is often just a matter of 
imagery. Or, perhaps, the moral framework of the audience - which is 
why I'll discuss terrorism's moral character later. The old saw "I'm 
a freedom fighter, you're a rebel, he's a terrorist" is funny because 
it's so true.

Let's look at a couple out of over 100 definitions in use. One of the 
emptiest and most provincial comes, unsurprisingly, from FEMA: "The 
use of force or violence against persons or property, in violation of 
the criminal laws of the US, for the purpose of intimidation, 
coercion or ransom." This definition would encompass most common 
crimes; indeed, with more than 5,000 criminal laws on the US 
government's books, almost anyone might qualify as a terrorist. 
Oddly, violating the laws of another country isn't covered.

The FBI's definition is much narrower: "The unlawful use of force or 
violence against persons or property to intimidate or coerce a 
government or a civilian population, or any segment thereof, in 
furtherance of political or social objectives." The key word here is 
"unlawful," which would seem to imply that if something is lawful, 
it's not terrorism. It also implies that if an action has financial 
motives, it's not terrorism. So if the 9/11 hijackers had been in it 
for the money, they wouldn't have qualified as terrorists.

As an aside, I might mention that of the 32 people on the FBI's 
most-wanted terrorists list, 31 have Arabic names.

Almost all the definitions I've seen, however, are imprecise, 
incomplete and/or concocted to make a prosecutor's life easy. I 
prefer this definition, which I created: "A tactic of using violence 
more for psychological purposes than for physical damage and that is 
intended primarily to delegitimize a regime by showing it to be 
ineffectual or by inciting it to overreact."

First of all, it's critical to note that terrorism is a tactic. As 
such, the idea of a "War on Terror" is nonsensical and absurd. You 
can't have a war on a tactic. That would be like a war against 
frontal assaults, cavalry charges or artillery barrages. Second, the 
tactic's operation is mainly psychological. This is important 
because, as Napoleon observed, "In war, the moral is to the physical 
as three is to one." Third, terror has political motives - 
delegitimizing a regime - because it's a variety of warfare.

As von Clausewitz points out in his most famous dictum, "War is the 
continuation of politics by other means." This view is seconded by 
Mao, who said, "The power of the state grows out of the barrel of a 
gun." Both men understood the essentially violent nature of the 
political process, of which war is the ultimate expression.

Here it's worthwhile observing that, although the US government has 
invaded a lot of countries over the years, it hasn't formally 
declared war since 1941. And I don't believe it's likely ever to do 
so again, as the nation-state itself breaks down and the world moves 
more and more toward asymmetrical and unconventional warfare. In 
other words, war isn't going away, but many of its traditional 
practices will disappear.

That said, Americans are used to thinking of terrorists as "the bad 
guys," even criminals. Some certainly are, at least in my view of 
what constitutes being a bad guy. But whether someone is a criminal 
has little to do with the use of terror per se. A criminal is simply 
"one who initiates the use of force or fraud," and that has nothing 
to do with his choice of tactics. I urge you, therefore, to discard 
any reflexive animus you may have against terror. If you want to 
think rationally about a subject, it's wise to identify, and get rid 
of, emotional baggage.

In that light, let's look at a few high points in the long history of 
terror. It's helpful in putting today's and tomorrow's news in the 
proper context.

Some Background On Terror

Most Americans are shocked and angered to hear anyone assert that the 
US was born with the aid of terrorism. That anger, however, is a 
knee-jerk reaction. When you think about it, you realize that terror 
is intrinsic to revolution, because revolution requires psychological 
trauma to delegitimize the old regime.

Don't get me wrong. I'm a fan in many ways of the American War for 
Independence. As it turned out, America was an excellent and unique 
place for most of its existence. The Declaration of Independence was 
a superb document, putting forth laudable ideals. The ConstitutionŠ 
not so much, although it was, thankfully, salvaged to a good degree 
by the Bill of Rights.

But the Revolution itself wasn't widely popular; perhaps two-thirds 
of the residents of the British colonies in the 1770s were loyal to 
the Crown and saw the rebels as terrorists (although the term itself 
wasn't yet in vogue). Rebels were notorious for intimidating 
loyalists, burning their homes and barns and even lynching them. 
Rebels launched assaults and ambushes on the colonies' legally 
constituted army, starting with the Boston Massacre in 1770 and 
continuing beyond the skirmishes at Concord and Trenton in 1775. The 
Boston Tea Party of 1773 was a clear act of terrorism. Although 
nobody got hurt, it involved the destruction of private property - 
the tea was on consignment from the East India Company to private 
merchants.

The nastiest type of war is almost always a civil war (with two or 
more indigenous groups fighting for control of the same population 
and territory), and the American Revolution had many aspects of a 
civil war. It was by no means just a war of "Americans" against the 
British. The British and loyalists correctly saw the insurrection as 
terrorism and high treason - the worst of all crimes, for which, even 
then, you could be (in sequence) drawn, hung, eviscerated, quartered 
and incinerated. Did the formation of an American government in 1776 
change the facts of the matter and make the insurrection less of a 
crime against the Crown?

Like all governments, the new American government was just a legal 
fiction with believers, although it did allow the "terrorists, 
"insurrectionists" or "rebels" to see themselves as a separate 
nation. If you make your own laws, I suppose you become, by that 
fact, legitimate. A change in perception by people with weapons can 
result in changed reality. But the point I'm making is that, based on 
their own history, Americans have no cause to be self-righteous about 
terror. They are on a spectrum, very far from both the beginning and 
the end.

Closer to the beginning, one instance of revolutionary terror we know 
of was conducted by the Zealots of ancient Israel, who used terror 
against fellow Jews who collaborated with the Romans. They found 
killing just a few people served as a salubrious example, making it 
unnecessary to kill more.

The Romans themselves understood the value of terror. Massacring 
everyone in a recalcitrant town served as a cautionary example to 
folks further up the pike, encouraging prudence in their decision 
about submitting or resisting. This is why Genghis Khan and Tamerlane 
went to the trouble of piling up the skulls of resisters into 
pyramids.

These are early examples of what might be called state terrorism. But 
is there actually any difference between terrorism conducted by a 
state, as opposed to a group that is resisting a state or trying to 
start a new one? I think not. What makes a state so special? This is 
a question few even bother to ask.

Guy Fawkes may be the first modern terrorist, for his emblematic 
attempt to blow up the House of Lords, including the king, on 
November 5, 1605. His case shows how terrorism can easily morph into 
a military operation. Why attempt to depose the king using an 
unwieldy army, when one man can take out the whole government at a 
fell swoop? You have to appreciate the fact that Guy is widely known 
as the only man who ever entered Parliament with honest intentions.

The Middle East is the current focus of terrorism, and the Israelis 
are viewed as stalwarts in the "War on Terror." But two incidents of 
terror, in particular - at the King David Hotel in 1946 and Deir 
Yassin in 1948 - were pivotal in the founding of Israel.

At Deir Yassin, a village of about 1,000, roughly 250 people were 
massacred by elements of the Irgun and the Stern Gang. Menachem 
Begin, later an Israeli prime minister as well as a Nobel Peace 
laureate, was quoted as saying, "Accept my congratulations on this 
splendid conquest. As at Deir Yassin, so everywhere, we will attack 
and smite the enemy." This understandably caused widespread panic 
among the Palestinians, and roughly 650,000 conveniently left their 
lands shortly thereafter and emigrated as refugees.

Begin was also in back of the terror bombing of the King David Hotel 
in 1946, which killed 91 people. The King David incident, combined 
with the kidnapping and execution of two innocent British soldiers in 
reprisal for the execution of several Jewish terrorists, moved the 
British to withdraw. I'm not, incidentally, trying to paint Begin as 
a particularly bad guy, just as a hypocrite; he was actually a very 
effective commander.

It's important to keep terrorism in context. It's simply a method of 
conflict. Conflict itself isn't good; I believe violence is a last 
resort and should be avoided at almost all costs. But terror, which 
is essentially and primarily a method of psychological warfare, is 
potentially much less destructive, as well as more effective, than 
conventional war.

If you want to win a conflict, terror is an extremely useful tool, 
but, like any tool, it has to be used properly and can sometimes be a 
suboptimal choice of tactic. For instance, the main point of 
Rumsfeld's notorious "shock and awe" bombing of Baghdad was to induce 
terror to help bring down the regime, a supplement to destroying the 
Iraqi Army. But destroying the army of a backward Third World country 
is one thing, and destroying the infrastructure of its capital city 
is something else, especially when the whole object of the exercise 
purportedly is to remove one man and his cronies. Here it would have 
been much more cost effective to forgo the terror bombing and use 
assassination, which I'll discuss shortly.

Sometimes terrorism is painted as a simple act of war, which 
sanitizes and legitimizes it. The destruction of Hamburg, Dresden, 
Hiroshima and Nagasaki were all acts of state terror. It was very 
late in World War II, and they were civilian targets, with no 
military value, only psychological value. If the Allies had lost the 
war, the Axis would have been quite correct in putting the 
perpetrators on trial for war crimes.

Sometimes, however, acts of war are painted as terrorism. The bombing 
of the USS Cole in Aden in 2000 was widely reported in the US as an 
act of terrorism. But in point of fact, it should be classed as a 
successful guerrilla operation. Clinton called its perpetrators 
cowards. If they'd been US soldiers, however, they'd (deservedly) 
have been given the Medal of Honor. The same is true of the truck 
bombing of the Marine barracks in Lebanon in 1983, where a local used 
available resources to take out foreign troops occupying his homeland.

Terror On A Spectrum Of Options

Let's look at terror by comparison to other options for conflict. Try 
to see it on a spectrum of violence, ranging from a schoolyard fight 
between a couple of boys on one extreme, to global thermonuclear war 
at the other extreme. I suspect its bandwidth on the spectrum will 
grow considerably, it will become much more overt, and it will, for a 
number of reasons, predominate for the foreseeable future.

Looking at political violence on a gradient scale, from the most 
narrowly to the most broadly focused, I mark it into four zones:

        *       Assassination

        *       Asymmetric/unconventional war

        *       Conventional war

        *       Nuclear war

I won't discuss nuclear war per se in this paper. But we will almost 
certainly see nuclear detonations in the real world in the years to 
come.

Assassination

Assassination is the premeditated murder of a political figure. The 
assassin is the smallest actor playing on the stage of political 
violence with, usually, only one perpetrator and one target. When it 
comes to creating political change, assassination is the simplest 
program available: do-it-yourself warfare. Its effect is immediate 
and direct, up-close and personal; and its costs and collateral 
damage are both very low.

One would think threat of assassination should be the most effective 
means of making a government comply with political demands. After 
all, a government isn't a magical entity; it's really just a few 
people who wanted power and got it. Officials don't want to die a 
violent death any more than the next guy. That's why an "offer you 
can't refuse" from the mafia is usually accepted. And it's widely 
admitted that, certainly if an assassin is willing to die in the 
process, nobody is proof against it.

That's why it's quite surprising to me that the systematic 
assassination of high officials of the opposing government isn't SOP 
in war. Even during WWII it wasn't considered cricket to go after 
Hitler as an individual. The meme has long been propagated that 
assassination - especially of a king or head of state - is an 
especially heinous crime. But upon consideration, the elevation of 
political assassination into a special category of crime doesn't hold 
up.

Why should the death of a politician be more serious than the death 
of anybody else? Murder is never a good thing, but isn't the death of 
a scientist, an artist or a businessman necessarily a bigger loss to 
society? Isn't the death of some politicians (certainly including 
known mega-killers - Hitler, Stalin, Mao, etc., etc.) a good thing? I 
would say that making assassination a special offense is fallacious 
propaganda, encouraged by states whose leaders are investing in 
professional courtesy.

But not always, as shown by Hasan al Sabbah.

Hasan ibn al-Sabbah, known as "The Old Man of the Mountain," founded 
the order of the assassins in the late 11th century. He apparently 
maintained his power not by fielding expensive armies, which are 
blunt-edged instruments at best, but by fielding well-trained 
assassins whose identities were unknown outside his inner circle and 
infiltrating them into enemies' upper ranks. A conflict with Sabbah, 
unlike a conventional war, was almost certain to result in the 
opposing ruler's death. Unlike in war, the common people were never 
hurt and, I suspect, almost always quietly applauded the death of 
their ruler - even if he was replaced by another just like himself.

Sabbah notwithstanding, assassination, even more than terrorism, can 
never be official state policy, simply because it overturns the basis 
of politics itself. People who get to the top of the government heap 
view themselves as part of a class, with as much loyalty to their 
peers - other political leaders - as to the entities they govern. The 
last thing they want is to encourage something that not only might 
come back to bite them but would estrange them from their peers. It's 
a pity, really, because assassination is a much better way of 
effecting political change than war from everyone's viewpoint - 
except that of the rulers.

Most assassinations throughout history have been perpetrated by lone 
cranks or ideologues, with no plans beyond killing a perceived 
miscreant and no backup organization to capitalize on the resulting 
power vacuum. Two rare and famous exceptions are Brutus' killing of 
Caesar in 43 BCE and Stauffenberg's attempt on Hitler in 1944. You've 
got to be sympathetic with Sabbah. The fact is that, throughout 
history, most leaders who were targets of assassination actually 
needed killing. Historically, assassins have been the benefactors of 
mankind. They may be due for a comeback, in the mold of Sabbah's 
group, or perhaps the heroes of the novel The Four Just Men.

Assassination can stand on its own but also can be a part of a larger plan.

Unconventional/Asymmetric Warfare

This is largely the world of the terrorist and the guerrilla. A 
terrorist is essentially just a step up from an assassin on the scale 
of political violence and a step below a guerrilla. Guerrillas are 
embedded in a society; as Mao said, a guerrilla swims among the 
people as does a fish in the sea. He avoids toe-to-toe contact with 
the enemy; as Mao said, the enemy advances, we retreat; the enemy 
retreats, we advance.

An assassin tries to achieve an objective by taking out individuals; 
a terrorist seeks his objective by using violence to change mass 
psychology. A guerrilla does both and also uses small units to attack 
the enemy's police and military.

Terrorism and guerrilla action are the best-known elements of 
unconventional and asymmetric warfare, but terrorism is in the 
ascendant as a method. Guerrilla warfare is useful for replacing one 
form of nation-state with another - but the nation-state itself is a 
dead man walking. So guerrilla movements will decline as their prey, 
nation-states and conventional armies, both wither away.

Terrorism is much more in tune with how the world is evolving and 
much more flexible. Terror is a bit like shrimp, the way it was 
described by Forrest Gump's friend Bubba. You can fry it, broil it, 
bake it, sauté it, fricassee it or serve it raw. You can serve it 
with tomato sauce, mayonnaise or lemon butter. You can eat it hot or 
cold, fresh or as leftovers. You can use it in a thousand ways. It's 
as idiotic to declare war against terror as it is to declare war 
against shrimp.

Terrorism has a big role in both unconventional and asymmetric 
warfare. You'll be hearing much more about these styles of conflict 
in the future.

Unconventional warfare addresses itself not to the enemy's military 
so much as to his society. The idea is to win by inducing a sense of 
hopelessness, war weariness, internal dissension and general 
economic, social and political chaos and malaise in the enemy. It's 
psychological warfare waged with violence, and terrorism is at the 
heart of it. The US Special Forces have long specialized in this; 
although they call themselves "counter-terrorist" specialists, in 
fact most of their time is spent training locals to act as terrorists 
or guerrillas against what Washington considers undesirable regimes. 
Sabotage, subversion, low-level assassination, the destruction of 
enemy morale and the creation of general chaos are key to successful 
unconventional war.

Asymmetric warfare is characterized by conflict between groups with 
significantly different powers or tactics. The key to success is 
never to engage the enemy at his strong points, only at his weak 
points. In other words, don't expect to see NATO fighting tank 
battles against the Russians, and don't expect to see divisions of 
the US Army arrayed against the Chicom Red Army. Proper guerrillas 
and terrorists are masters of both unconventional and asymmetric 
warfare. I discuss the implications of asymmetric warfare in the 
section below on technology.

Most people in the world are poor. Many, especially those who take 
Islam seriously (poor people are usually more religious than rich 
people) have real or imagined grievances against the West in general 
and the US in particular. Because they're poor, they'll use poor 
people's weapons - but I'm not talking about hoes, scythes or 
machetes - to battle the US Empire. The majority of the weapons of 
advanced nation-states, however, are intended for fighting the 
conventional armies of other nation-states. Combat with the US will 
be, therefore, asymmetric. It's no longer a question of a tank 
against another tank, but a tank against an IED.

Conventional War

Conventional war is focused on destroying the enemy's military. But 
this style of war - massive armies, tanks, bombers, aircraft carriers 
- no longer makes much sense. It's entirely too expensive and 
entirely too destructive. Even in the 1980s, when most people were 
worried about a Soviet invasion of Europe, I already felt it most 
improbable simply because the nature of wealth has changed.

Today wealth is largely intangible. It's technology, businesses, 
skills and knowledge. These things can't really exist without 
something approximating a free market; you can't effectively steal 
them. Owning land and buildings is pointless if you can't use them 
productively, something collectivists are chronically incapable of. 
It's not like war in the old days, where the point was to steal the 
gold, the cattle and the finery in the palace while turning the 
population into slaves for profitable sale. In ancient times, war 
could be a gainful undertaking for the winner. Today it just 
guarantees eventual bankruptcy for everybody.

It's been obvious for years, to everybody but the generals and 
defense contractors, that the current generation of military weapons 
- the stuff the US spends scores of billions of dollars a year on, is 
little more than high-tech junk. Of course that's nothing new, in 
that the military always fights the last war. They were investing in 
cavalry before WWI. They were big on battle ships before WWII. Now 
they have huge investments in aircraft carrier groups that are 
vulnerable to nuclear strikes or to massive assault by supersonic 
sea-skimming missiles or to torpedo boats. Giant war machines are 
really only useful for fighting conventional forces, and only 
nation-states can field conventional armies and navies. Technology, 
however, holds a major change in store for everyone.

Technology: The Revolutionaries' Friend

As I say that, though, nation-states and their conventional 
militaries are developing the next generation of weapons and tactics. 
It's very much the way they were still building battle ships after 
the aircraft carrier was already ascendant. Five areas are evolving 
at once:

        *       Computer warfare

        *       Robotic warfare

        *       Biotech/nanotech

        *       Nuclear weapons and

        *       Special ops

As might be expected, the state took an early lead in all five areas, 
just as it was the first to get gunpowder at the end of the Middle 
Ages. The Internet is the classic example of how this works. It 
started out as a DARPA (Defense Advanced Research Projects Agency) 
project, but it quickly migrated to society at large. Now DARPA is 
irrelevant to the Internet, just another user. It's only a fluke they 
invented it to start with; someone else would have in short order if 
they hadn't.

Computer Warfare

In computers, the state had the money to spend on the biggest and 
fastest supercomputers; but now networks of laptops, owned by 
everybody, are better and much cheaper. People, however, are the 
critical element of computer power, and it's inconceivable that 
government employees will ever have a fraction of the talent of 
independent hackers - in addition to the fact they'll be outnumbered 
100 to 1. This is an important point, in that not only is all of the 
world's infrastructure now run by computers, but so are all the 
military's toys. Computer-oriented terrorists won't have to blow this 
stuff up, they'll be able to disable it or even take it over. Hackers 
may wind up co-opting a lot of the military's robotics when they're 
actually being used in battle.

Robotics

The military is advancing rapidly in robotics, actually at the rate 
of Moore's Law. They already have a quadruped that can outrun a human 
over rough ground. It seems likely that in only a few years 
Terminators and Robocops will be a reality. Airborne drones are 
increasingly competent and will replace manned fighters for most 
applications.

Now that the cat's out of the bag, anybody can have his own panther, 
and I'm not just talking about the 20 other governments that are 
developing their own programs. Individuals can play this game. One 
example that came to my attention a couple years ago was a New 
Zealander who built a homemade cruise missile, including the jet 
engine and avionics, for $6,000. The military version costs $1.5 
million per copy.

Biotech/Nanotech, 3-D Printers and Lasers 

Just as two generations ago a couple of kids in a garage could make 
breakthroughs in computer tech, the same thing is happening all over 
the world in biotech. The cost of research equipment is plummeting, 
while knowledge of and interest in biotech processes are expanding 
rapidly. The same is true of nanotech, which is a related scientific 
discipline. As you know, I believe nanotech has the potential to 
change the nature of life itself - quickly and totally.

There are lots of breakthrough technologies aborning. One of the most 
interesting is the 3-D printer, which allows anyone to rapidly and 
cheaply "print" an object the way a 2-D printer produces an image. 
Soon it will be possible to create almost anything in the comfort and 
privacy of your own home. A.E. van Vogt's vision in The Weapon Shops 
of Isher is soon to be realized.

My guess is that laser weapons are also going to become the hot 
set-up. I'm not just talking about the megawatt devices that have 
already been developed by the military, but cheap hand-held lasers. 
Even now a revamped laser from a commercial projector can blind an 
opponent at hundreds of yards. You can be sure that hackers are going 
to make quantum leaps in developing this, and it won't be long before 
these weapons are both cheaper and better than firearms.

Nuclear

The world has had nuclear weapons for close to 70 years. The time is 
coming when any billionaire can make one for himself. The 
technologies are well known, and the equipment needed is vastly 
better and cheaper than it was in the relatively primitive Manhattan 
Project days. After all, if the North Koreans can succeed in it, so 
can anybody. But the cheaper, easier way to get a nuclear weapon is 
to steal or, better, buy one from some Russian, Pakistani or Indian 
general, with instructions for deploying it. At that point, it's just 
a slow boat or a fast cargo plane ride to New York or Washington. And 
there's no need to clear customs.

Special Ops

Historically, being a soldier meant drilling incessantly, doing lots 
of brainless manual labor and following orders like a dogbot. This is 
why throughout history - notwithstanding the obvious, exciting 
aspects of the trade - soldiers have been scraped from the bottom of 
society's barrel, potential cannon fodder who couldn't do better for 
themselves.

This is now changing. It used to be that members of the Special 
Forces were looked upon as oddballs by the Army leadership, and it 
was a dead end for a career. That's changed with the rise of 
unconventional/asymmetric warfare. Now all branches of the military 
have large special ops units. Members are significantly above the 
average dogface in terms of physical ability, intelligence, 
aggressiveness, training and equipment. In effect, the soldier is 
morphing back into the warrior, and as such is worthier of respect.

However, special ops guys are still government employees, even if 
they're also trained killers. All the skills (and most of the 
equipment) they use are readily available to their opponents in the 
world of terrorism. Once these guys are mustered out of national 
armies, they gravitate toward mercenary companies, like Blackwater/Xe 
and Sandline. Then they will join any group that makes it worth their 
while.

Technology has always been both a politically and an intellectually 
liberating force for the common man. Gunpowder allowed a peasant with 
a firearm to best a heavily armored knight. Cannon allowed a peasant 
army to destroy the hilltop castles of the "nobles" who once 
dominated them. Much the same is happening today, except much faster 
and to a greater degree.

On a human level, success in most things - certainly including war 
and politics - boils down to economics and psychology. In the 
economic sphere, it's a question of capital costs, operating costs 
and return on investment (ROI). In the psychological sphere, it's 
largely a question of will. At this point, for the US the costs are 
astronomical and the ROI deep in the red. It doesn't matter how rich 
you once were; anyone can go bankrupt.

Meanwhile, the average American or European can see his ship of state 
taking on water rapidly. In a world of asymmetric war, that means the 
"little guys," the outsiders, the disadvantaged - the groups most 
likely to make terror their friend - have much more going in their 
favor than ever before. And they may have a big psychological 
advantage since, as poor people, they have little to lose.

Let's look at a few simple examples.

An AK-47 costs less than $500 most places in the world; the bullets 
cost about 20 cents apiece, and the teenager to employ them costs 
nothing at all. In fact, teenagers in the Muslim world are in such 
oversupply that they can be said to have a negative cost.

A US soldier, by contrast, is immensely expensive. Even though most 
of them come from lower socio-economic levels, a substantial 
investment has been made in taking them even through Grade 12. Then 
comes the cost of recruiting, training, equipping, paying, insuring, 
housing and transporting them in the military. I'm not sure the cost 
of a US soldier in the field has ever been accurately computed, but 
it has to be well over a million dollars for a simple grunt and much 
more for a specialist. That's not counting the lifetime of pension 
benefits and medical care for the maimed. And with battlefield 
medical as good as it now is, the ratio of seriously wounded to dead 
is much higher than ever before. You may sympathize with the US 
soldier, but he's definitely on the wrong side of the equation.

An M-1 tank costs about $5 million a copy. It, or any other vehicle, 
can be destroyed by an IED fabricated from fertilizer or unexploded 
ordnance. Even if it's not destroyed, or not even severely damaged, 
the brains of its occupants are likely to be scrambled by the blast 
wave. This is, incidentally, something that is underappreciated. A 
blast wave bounces a brain around in a skull like an egg inside a tin 
can. Considering that IEDs are both devastating and extremely hard to 
detect, it's no wonder they're so popular.

Have you ever wondered why there's no reporting on the numbers of 
tanks, APCs, Humvees, helicopters and other (immensely expensive) 
hardware being destroyed in the current US wars? It's classified, 
because the numbers would be so embarrassing. Unlike in Vietnam, 
there's no longer any body count of the enemy because that would be 
politically incorrect. But it doesn't matter how large it is; every 
dead jihadi is a dragon's tooth that will grow back as ten 
replacements. That's why there's really no way to win a guerrilla war 
before you go bankrupt - no way short of genocide or at least serious 
mass murder.

A $1,000 RPG will easily destroy a million-dollar armored personnel 
carrier and its occupants. A $10,000 shoulder-launched missile can 
take out a $10 million helicopter or a $40 million F-16. It may be 
practically impossible to shoot down a $1 billion B-2 bomber, but 
that's academic; they were built to fight a nuclear war against the 
USSR. They're useless except to deliver atomic weapons, but the new 
enemy lives in refugee camps and scattered within teeming cities. The 
B-2's codename should be changed from Spirit to Albatross, because 
it's not only totally uneconomic, it's almost totally useless.

So the economics of guerrillas attacking an invading superpower are 
excellent. In response, the economics of a superpower attacking 
guerrillas or terrorists are disastrous. In its current wars, the US 
winds up using cruise missiles, at around $1.5 million each, to blow 
up wedding parties. The direct expense is bad enough; the vastly 
greater indirect expense is the creation of a clan of new enemies. 
The best result is for the missile to just pulverize some sand. Even 
if it hits a few mujahidin, that's placing an implied value of 
several hundred thousand dollars apiece on their heads.

In other words, whether we're looking at offense or defense, the 
economics of destruction are tilted not just 10 to1, not just 100 to 
1, but probably closer to 1,000 to 1 in the favor of insurgents.

Perhaps you're thinking further advances in technology will tilt the 
equation back toward the US. But as I explained above, the effect of 
each innovation will be just the opposite after only a short period 
of technological monopoly. People have a lot of misplaced confidence 
in the so-called "defense" establishment to come up with marvelous 
devices to confound groups designated as the enemy. Of course 
advances will be made, at least for as long as the US government has 
scores of billions to spend on R&D annually - which it soon may not, 
for financial reasons. But even if it diverts funds from its myriad 
other projects, the procurement process is stultifyingly 
bureaucratic, slow and costly. It's not at all entrepreneurial, which 
it still was to a degree even during WWII, when the P-51, the best 
fighter of the war, was taken from concept to production in nine 
months and turned out for $50,000 a copy.

The US will even lose the war for new weapons as time goes on, simply 
because the Defense Department bureaucracy is so counterproductive. 
It's like the company Dilbert works for in the cartoon pitted against 
millions of independent entrepreneurs in the Open Source world. 
Dilbert's company moves like a dinosaur, while the Open Source world 
watches, imitates, innovates and improves at warp speed.

Today a ponderous state supposedly represents our side (I italicize 
that because, although I truly dislike many of the people it's 
fighting against, I consider it to be an even greater danger). At 
best, it resembles a dim, tired old Tyrannosaurus up against hundreds 
of smart young Velociraptors intent on eating it. The outcome is 
obvious: a bunch of the attackers will get killed, but the T-Rex is 
dead meat.

Remember that there are more scientists and engineers alive today 
than in all of human history before them, the vast majority from 
non-OECD countries. The ones who are any good don't want to work in a 
constrained, bureaucratic environment with no financial upside. 
Entirely apart from that, if the minions of the perversely named 
Defense Department come up with a real super-weapon, in today's world 
it's easy to replicate and improve on, and for a fraction of the 
original cost. That's why there are scores of thousands of apps 
developed for most any electronic device that hits the market today - 
in addition to the device itself being "knocked off" illegally by 
small factories that could be anywhere.

How Terrorism Will Evolve

Now back to our core story. Although everyone, from the largest 
nation-state down to the smallest informal group, employs terror 
(because it's cheap and effective), it really only concerns Americans 
when terror is used against them. Instead of minding its own business 
and being a friendly beacon for the rest of the world (which would 
obviate 99% of the potential problem), the US has invaded several 
countries, is attacking several more and has troops in a hundred more.

Americans, however, seem incapable of understanding that the natives 
don't appreciate invaders any more than Americans would like an army 
of Muslim teenagers running around Texas, breaking down doors at 
midnight and generally shooting up the place while trying to uplift 
it with their own culture. Americans, foolishly, are living in the 
past and think the world still sees them as liberators, as they were 
in France almost 70 years ago. Is it possible, instead, that the US 
has turned into an aggressor abroad and a police state at home?

So far, with the exception of the events of 9/11, the US has had very 
little blowback for attacking foreign countries without even the 
courtesy of a declaration of war. However, as Washington antagonizes 
more groups around the world, the targets eventually will decide to 
take the war back to the US simply because it's the intelligent way 
to fight. So in the years to come, the US is likely to see lots of 
terrorism in the "homeland" (a disturbing new term) itself. It will, 
perversely, have created exactly what it was trying to avoid.

Let's state the obvious: opponents of the US Empire are now 
concentrated among the world's over one billion Muslims. The new 
enemy won't model themselves after past icons of insurgency, like 
Mao, Che or Ho Chi Minh; those men were guerrilla theorists, trying 
to supplant one type of nation-state with another. The jihadis' model 
will, instead, be Osama, himself a creation of Washington in 
Afghanistan. And he's an ideal model for them. Osama clearly stated 
not only why he was fighting (foreign troops in Muslim homelands, US 
support of corrupt puppet regimes and US support of Israel - 
reasonable points). But he clearly stated an attainable objective - 
the bankruptcy of the US Empire. And he clearly specified a practical 
method of attaining the objective - terrorism. The US has fallen into 
his trap.

The US Empire is acting like an enraged giant dinosaur in its death 
throes and is irrationally cooperating in its own demise. Think, for 
instance, of the destruction of wealth and freedom that Homeland 
Security even now causes, in the face of a de minimis terrorist 
threat. Yes, every year they make a spectacle out of a ridiculous 
underwear bomber, or they talk some halfwit into fomenting a 
transparent plan of some sort so they can arrest him and produce some 
security theater to justify their existence. However, eventually 
(soon) they will provoke some real and serious terror strikes, 
perhaps after provoking a real war with Pakistan or Iran.

What form will it take? Perhaps massive systems disruption, which is 
quite simple to do in an advanced country. Blowing up a bunch of 
electrical substations would be easy. Poisoning municipal water 
supplies would create chaos. Or perhaps RPG attacks on refineries and 
oil tank facilities. Or explosive attacks on large computer server 
farms.

That's just scratching the surface. It would be easy to replicate 
what happened in Mumbai in 2008; a dozen men, equipped with simple 
weapons, could shut down a city. Or, if they wanted to be more 
subtle, they could copy the two snipers who, in 2002, operating from 
the trunk of a car, caused mass hysteria in Washington; they were 
only caught by accident. The anthrax scare, the Unabomber - anyone 
with a couple hours of idle time and a bottle of Jack Daniel's could 
come up with a score of viable terrorist schemes. The key words are 
easy, cheap, effective, unpredictable and unstoppable. Leave the rest 
to the US government, which, because it needs to "do something," 
would lock down the country like one of its numerous new prisons.

I doubt the attacks will be gloves-on, like those of the IRA in the 
latter years of its war against the British. To oversimplify the 
matter, the IRA was a response to (what it perceived as) the British 
Army's occupation of Northern Ireland. At first, like today's Muslim 
jihadis, they fought a war against the actual soldiers occupying 
Ireland and their local collaborators. They eventually came to the 
conclusion that, even though it was gratifying, it was not only an 
inefficient use of resources but even counterproductive.

The IRA, intelligently, recognized that you shouldn't make your home 
into a free-fire zone just to keep out unwanted guests; so it stopped 
producing violent incidents in Ireland. Why antagonize people where 
you live? Second, it figured out its real enemy wasn't so much the 
troops in Belfast (they were just pawns), it was the British 
government in London; so that's where it redirected its attacks. 
Third, it made sure not to harm innocents; before it set off a bomb 
in London, it would alert the media, so that the area could be 
cleared. They changed their image from mad dogs to aggrieved citizens 
in the tradition of Jefferson and Franklin and achieved many of their 
objectives. They used terror tactics but totally changed their image, 
thereby largely defusing the moral objection to terror.

Unfortunately, when the jihadis bring terrorism to the US, it won't 
be the measured version the IRA deployed against the British 
government. Why should it be? Unlike the IRA, their real demands will 
be secondary; instead, they'll be looking for pure revenge. And, 
certainly after Washington hits a place like Iran or Pakistan, 
millions will feel the US deserves some real payback. The attacks 
will be sloppy, nasty and structured for maximum casualties. At that 
point, it's completely predictable that the US government will lock 
the country down. In fact, we may finally find out whether those 
rumors about FEMA camps are real. In any event, they'll overreact, 
which is one of the objects of terrorism, and the reason why it can 
be so much more successful as a tactic today than it ever was under 
the Romans or Tamerlane. There's a good chance, at that point, that 
the US will go wild and use nuclear weapons against the Muslim world, 
and Boobus americanus will predictably and thoughtlessly support it.

A Nod To Morality

English-speaking cultures, like the Americans and especially the 
British, like to fancy they "play fair" in war. Of course that's 
delusional self-mythologizing. But it makes them feel especially 
self-righteous when denouncing unconventional and asymmetric warriors 
as terrorists. I've tried to show that terrorism is just another 
tactic. Its use can be criminal, but no more criminal than any other 
tactic.

In any event, the concept of "fair" makes even less sense in war than 
it does in street fighting, because the stakes are so much higher. 
"Fair" in war is for idiots, who will probably also be losers. Just 
so you know, I disapprove of violence in general and very much 
dislike war in particular. But I think it's important to look at the 
issues rationally. And there's such a thing as the intelligent use of 
a tactic and the stupid use of a tactic. It's stupid use that gives 
terror a bad name.

The morality, or lack thereof, of terrorism is what seems to bother 
most people. But morality has always been a rare commodity in war. 
Especially since World War II, with the popularization of total war, 
where civilians and non-combatants became targets. Normal warfare 
today intimately involves innocent parties, although lip service is 
always paid to how unfortunate collateral damage is.

But let's take right and wrong out of the picture for a moment. 
Causing non-combatant casualties is simply unintelligent in most 
cases; it's bad public relations and, as the IRA found, doesn't make 
friends in any quarter. Conventional armies, with set-in-stone orders 
executed by scared, testosterone-charged teenagers, are a terribly 
blunt instrument. A proper terrorist attack on a specific target by a 
small number of trained personnel should be, ideally, highly 
selective about who gets hurt.

But not always. Take, for instance, the bombings of the US Embassies 
in Nairobi and Dar es Salaam in 1998. On the one hand, killing 
hundreds of innocent people might have created a huge blowback 
against al-Qaeda. But it doesn't appear to have done so because the 
terrorists (correctly) argue that those hanging around were a species 
of collaborator - looking to work for the enemy, looking to get visas 
to visit the US. It served as a warning to locals to stay away from 
the Americans, pinpointing them as unwanted interlopers and 
associating them with danger and death.

The 9/11 attack on the US, assuming the accepted conventional wisdom 
is correct, was misdirected in many ways. Instead of hijacking 
civilian airliners, the attackers could more easily have purchased 
some old cargo jets and loaded them with explosives for much more 
effect; no innocent, sympathy-garnering passengers need have died. 
Instead of attacking commercial buildings of the World Trade Center, 
they could as easily have attacked purely governmental targets. The 
Pentagon was fine from that viewpoint; it's a purely military target, 
and few people have warm feelings toward it. Attacking the IRS 
headquarters in Washington and/or Martinsburg, West Virginia, would 
have actually drawn applause from most Americans (however muted, for 
reasons of discretion). A third target might have been CIA 
headquarters in Langley. A fourth might have been NSA at Ft. Meade, 
Maryland.

That would have been smart terrorism, the way the IRA would have done 
it. It would have, to a degree, divided sympathies in the US instead 
of uniting the country behind a crusade against Islam. It could have 
sustained a morality-based defense.

So was 9/11 simply poor strategic thinking on the part of fanatics? 
Or was it, on the contrary, sophisticated strategy on the part of an 
enemy group who wanted to get the US involved in fighting wars 
against a bunch of Muslim tar babies? Or was it a Reichstag fire, as 
some have asserted? Osama said he approved of it but denied it was an 
al-Qaeda operation. I suspect there's more to the attack than meets 
the eye. Certainly the subsequent investigation was, at best, 
superficial and incomplete, with the strange collapse of WTC 7 being 
just the most obvious of the many unanswered questions.

But this is the nature of 
asymmetric/unconventional/terrorist-oriented conflict. We'll be 
seeing a lot more of this kind of thing in the future, where the 
identities of the players, their motives and even the moral issues 
are murky. The era of formal conflict, where one government declares 
war against another, and supposedly "good wars" like WWII, is 
essentially over. At least for anyone with any smarts, who's not a 
pathological nationalist.

How This Will End

So what's in store for us? It seems that major trends have lives of 
their own, and almost nothing can turn them around. Could anything 
have stopped the collapse of the Roman Empire? I doubt it, based on 
the fact that the long decline really started after four good 
emperors in a row (Trajan, Hadrian, Antoninus Pius and Marcus 
Aurelius). Could, therefore, the election of Ron Paul in the US turn 
around the ship of state? No. Even if he were still willing and able 
to do anything after he got a severe talking to by the heads of 
various Praetorian agencies, he'd find the populace too corrupted, 
indebted and apathetic to change. These things have lives of their 
own. That's the point the Kondratieff Wave theory and the 
generational theory of Strauss and Howe in The Fourth Turning and Bob 
Prechter in his Elliott Wave theory publications all make.

Even with a roughly $1.5 trillion annual cash deficit (the more 
accurate accrual deficit is much higher), the US government is 
showing absolutely no movement toward cutting expenses. Nor will 
they; deficits are only going to get larger from here on. Everywhere, 
hack economists are urging them to spend more. It will surprise me if 
the annual deficit doesn't go much, much higher as the Greater 
Depression deepens.

But who will buy all that new debt or even roll over existing debt? 
At roughly zero percent interest, it will no longer be foreigners; 
they're really not that stupid. In fact, the Europeans, Chinese and 
Japanese have massive problems that will likely force liquidation of 
much of what they have. The Fed will be forced to buy, and monetize, 
much more of the government's debt. Inflation is going to explode 
but, unfortunately, that may happen only after a credit collapse. If 
so, we'll get the worst of all worlds in sequence, a tour of miseries.

Where will the US government cut back out of the roughly $3.5 
trillion it spends annually? Social Security ($705B) and a myriad of 
welfare and pension programs ($624B) will lose ground to a debased 
dollar. Medical spending ($820B) will be means tested. Interest is 
$200B, and all the rest of government together $400B. And "defense" - 
a misnomer if there ever was one - is $850B. Where do you cut $1.5 
trillion to eliminate the deficit? I promise I could find twice that 
easily, but I guarantee Washington won't find a tenth of it. A 
financial disaster of the first magnitude is absolutely guaranteed. 
If someone can show me where I'm wrong, I'd be most eager to hear it.

Will they cut the military? Americans love to "support the troops," 
which seems to boil down to throwing money at them for pointless 
wars. Congressmen love "defense" spending for all kinds of reasons, 
including that weapons are among the few things this country makes 
anymore. The president (all of them for the last 30 years) appears to 
love war. Although Gadhafi is dead, I'll warrant the war in Libya is 
far from over; there's going to be a civil war that lasts for years. 
And Obama has just sent combat troops to Uganda. Yemen and Syria look 
like they're on the runway. Pakistan and Iran could each go critical; 
even as I write, Washington, London and Tel Aviv are talking openly 
about a joint strike. One can only hope Washington doesn't antagonize 
the Chinese into a confrontation.

The only good news is that the US may be asked to leave by Iraq and 
Afghanistan; hopefully that will occur before it's necessary to 
evacuate people from the rooftops of the embassies, a la Saigon in 
1975. The only real hope is that Washington will be forced to cut 
spending simply because it's no longer creditworthy.

On a broader plane, I don't know how you can eliminate conflict from 
human action. It's probably not possible unless you can both cleanse 
each and every individual of psychological aberrations that lead to 
initiating aggression and also eliminate the state, which 
institutionalizes violence. Until then, the best you can do is to 
limit the role of politics in every facet of life. And emphasize men 
relating to each other voluntarily to get what they want, through 
free markets. Remember, once again, von Clausewitz's shrewd 
observation: War is the continuation of politics by other means. And 
one other thing: try to profit from the sorry situation. Although we 
didn't make the rules, we still want to win the game.

Profits

As my friend Richard Russell has said, in a depression nobody wins; 
the winner is the guy who loses the least. And the truth of that is 
only compounded when you add war into the equation.

What are the options? First, make sure you've got a considerable 
percentage of your assets in physical gold and silver. Second, make 
sure you have a considerable percentage of your assets diversified in 
one or (preferably) more foreign jurisdictions and that those foreign 
assets include real estate. Third, plan on future bubbles being 
inflated. Including one in gold mining stocks, which now offer 
excellent value.

That's advice you've read here many times before, but it bears 
repeating because it's so important. You are, however, likely asking 
yourself what might be done to profit from war. Defense contractors 
are an obvious play, and we're going to take a close look at them - 
especially the small, obscure ones. That will be in a future issue; 
there's no urgency to get into stocks right now that I can see. Rare 
earths, since they're high-tech metals, are of interest - but they're 
not bargains, and the stocks of companies that explore for them are 
very overpriced.

I'd love to be a war profiteer. But it's much more important to 
ensure you don't become a casualty.

Doug Casey (send him mail) is a best-selling author and chairman of 
Casey Research, LLC., publishers of Casey's International Speculator.

Copyright © 2012 Casey and Associates


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