Introduction
The economic power in current global ecosystem has assumed more significance compared to conventional use of military power. The world has become increasingly flat and hence economic influence is becoming more impactful. On an upside, economic influence can be used to promote bilateral and/or multilateral economic relations between nations. On a downside, economic influence can be used to promote specific political, social and, of course, military goals. This is called, for current purposes, economic terrorism. By coercing nations into specific actions – or, for that matter, intimidating nations to backtrack from specific actions – coercive powers (state actors, non-state actors or state-sponsored players) impose specific course of action to achieve short, medium or long range goals. Predictably, economic terrorism is performed by countries giving enough global, or at least regional, economic clout. For reasons spanning strategic power balance to punitive measures to "chastise" an ally gone astray or punish a foe, economic terrorism is applied by countries at extreme ends of economic spectrum. The means by which economic terrorism is applied are as equally diverse. For current purposes, specific countries are studied as examples of economic terrorism namely, U.S. and Saudi Arabia. The U.S. is selected as an ideal example of a global power using, among many different policy means, economic terrorism in order to influence local, regional or international policies in specific areas. The global engagement of U.S. in world affairs – particularly during what is commonly referred to as War on Terror – makes economic terrorism a particularly interesting moral question. Similarly, Saudi Arabia represents a good example of a regional power (and less so globally) employing economic terrorism to achieve specific political and/or economic goals. Boosted by unprecedented oil revenue boom, Saudi Arabia has used her expanding financial clout to offset growing influence of specific regional powers, particularly Iran, by funding proxy wars or leading military coalitions. To better contextualize economic terrorism, a deeper analysis of U.S. and Saudi Arabia practices is required. For current purposes, a moral perspective is adopted to examine whether acts of economic terrorism are justified or not. This paper aims, hence, to examine economic terrorism concept as practiced by U.S. and Saudi Arabia in order to appraise morality of performed acts.
The paper is made up of four sections in addition to introduction: (1) U.S. Economic Terrorism, (2) Saudi Arabia Economic Terrorism, (3) Economy and Terrorism and (4) Conclusion. The U.S. Economic Terrorism section explores means and contexts U.S. employs and is involved in to practice economic terrorism. The Saudi Arabia Economic Terrorism section explores means and contexts U.S. employs and is involved in to practice economic terrorism. The Economy and Terrorism section is a broader reflection on correlations between economy and terrorism. The Conclusion section wraps up argument and offers further insights.
U.S. Economic Terrorism
The U.S. is a global superpower having complex and overlapping relationships at military, political, economic, social and cultural levels. This global engagement is not always smooth and often requires more aggressive interventions in order to fend off possible risks and/or lend a push for specific military, political and/or economic goals. Probably, one most notable act of economic terrorism, or alternatively economic coercion, is sanctions on what U.S. Government, particularly under George W. Bush, has referred to as "rogue states". In adopting different measures as part of War on Terror, U.S. Government has imposed a broad range of economic sanctions on countries such as Iran, Iraq, Libya, Syria, Sudan, Cuba, Afghanistan and Somalia (Hufbauer, Schott and Oegg). Targeting specific groups in mentioned countries, under a broad banner of War on Terror, U.S. has imposed economic sanctions, for example, on Iraq during most of 1990s (prior to actual invasion later in 2003). The sanctions meant initially (as pronounced by U.S. Government in numerous occasions) to limit Saddam Hussein's powers presumably in order not to posses weapons of mass destruction, metamorphosed into a lucrative business of low-priced oil in international markets, only to cast moral doubts of not only Oil-for-Food Program (apparently managed by United Nations) but also of morality of economic sanctions and war.
The series of economic sanctions imposed on Iraq for years has been extended for above mentioned countries as well for different reasons. The case of Iran is probably one most morally questioned one. If anything, Iran has been a regional player in Middle East for decades. The influence of Iran, an oil-rich country, extends, according to U.S. officials, far beyond political jockeying over regional influence (against Saudi Arabia as shown in further detail in next section) and into more economic control. The recent lift of economic sanctions on Iran (and, in a different context, on Cuba) put into moral question initial causes of decades-long sanctions. If anything, Iran (and, for that matter, Cuba) has been rewarded for her "cooperation" on atomic possession capabilities probe.
The economic sanction, as an act of economic terrorism, has been complemented by additional, financial probes – and often closes monitoring – of not only corporate assets and bank accounts but also personal information of "suspect" terrorists. The Terrorist Finance Tracking Program (TFTP), managed by U.S. Treasury Department, is a case in point ("Terrorist Finance Tracking Program"). The program monitors, among many things, SWIFT transfers of suspected terrorists based in Europe ("Terrorist Finance Tracking Program"). By making an agreement with EU on sharing information about suspect terrorists in Europe, U.S. Government is, in fact, performing an act of economic terrorism, albeit indirectly. By forfeiting rights of not only individual suspects of privacy but also of countries to perform independent or bilateral investigations, U.S. Government is performing an act of economic terrorism.
Conversely, U.S. is increasingly believed to have been exposed to acts of economic terrorism. According to a report produced by a Pentagon contractor, a growing body of evidence suggests 2008 economic crash was not entirely due to internal economic factors but was partly caused by market manipulations by a broad range of "financial enemies" including Middle East countries, Islamic terrorists, Chinese military and government or organized crime groups in Russia, Venezuela or Iran (Gertz). This is, if proven true, represents an act of economic counterterrorism. In response to U.S. economic terrorism, state-sponsored and/or independent, terrorist economic terrorism comes in retaliation and/or for purposes as equally diverse to U.S. motivations for economic terrorism.
Saudi Arabia Economic Terrorism
In a similar fashion (but at a smaller scale), Saudi Arabia performs acts of economic terrorism at a regional level. Given clear rivalry between Saudi Arabia and Iran, Saudi Arabia is limiting economic activity in Lebanon in order to deter Iran-backed Hezbollah (Erika and Kerr). By drying up funds for enterprises believed to have ties to Hezbollah, Saudi Arabia is performing an act of economic terrorism on a whole country. Instead of pursuing parallel lines, Saudi Arabia opts consistently for economic "strangling", so to speak, of Lebanon's economy.
The case for economic terrorism in Saudi Arabia's case is, indeed, far more complicated and is enmeshed in sectarian conflicts and global terror funding networks. The Hajj (pilgrimage) performed annually by millions of Muslims is reported to be a Trojan horse for backdoor funding for terrorist groups (Boucek). Notwithstanding government's efforts to control charity donations (a backdoor for funding terrorists), terrorist groups – in Saudi Arabia – are still able to secure streams of cash (Boucek). These groups, interestingly enough, have not developed out of thin air but have, in fact, been sponsored (and some probably continue to be) sponsored by Saudi Arabia Government to coerce national or international actors into specific actions. Thus, in a fashion similar to U.S. funding of "terrorist groups" for specific purposes over specific periods (only to be abandoned later), what Saudi Arabia is experiencing can be qualified as retaliatory economic terrorist acts, acts meant to cripple country's economy (as is discussed in more detail under " Economy and Terrorism").
Interestingly, Saudi Arabia appears to be spreading money around (by spending lavishly on mosques and Islamic schools) in countries as Malaysia and Pakistan and offering countries as Lebanon military aid (mostly to fight a proxy war against Hezbollah) in hopes to return "favors" (Dyer). On a face value, Saudi Arabia's approach to economic aid is commendable. Deeper still, money offered to groups and/or states represents, however, a manifestation of economic coercion to push for specific political and/or economic goal. This, again, brings into question morality of Saudi Arabia's acts of generosity and sheds further light on underlying motivations for economic terrorist acts more often than not projected as fending off imminent national risks.
Given current regional situation in Middle East, Saudi Arabia is performing, par excellence, acts of economic terrorism, directly or not. In a direct fashion, Saudi Arabia is lavishing money on fighters in Syria and Yemen in order to, predictably enough, minimize (if not eliminate) Shiite influence of Iran. This economic terrorism is manifest in different forms. In addition to direct armament of fighting factions in Syria and Yemen, Saudi Arabia is providing more economic aid (veiled as "humanitarian aid") for embattled groups in Syria, Yemen and Iraq and hence performing an act of economic terrorism aimed to achieve pronounced (or not) political goals.
In a less direct fashion, Saudi Arabia is helping Egypt – a country suffering serious economic problems after a historical popular uprising in 2011 leading to ousting a 30-year ruling president – overcome, apparently, her economic woes. In a deeper analysis, Saudi Arabia is performing an act of economic terrorism on Egypt by buying out her support for her military campaigns in Yemen and, more broadly, her strategic objectives of limiting, if not eliminating, Iran's regional influence. Thus, directly or not, Saudi Arabia walks a familiar line passed by U.S.
Economy and Terrorism
The overlap between economy and terrorism is dense. Typically, poor economic performance has been broadly identified as a critical reason for why terrorist groups emerge. This long-held assumption has, however, been challenged by a growing body of literature (Piazza; Blomberg, Hess and Weerapana; Li and Schaub). The emergence of a breed of terrorists born outside "common" terrorist-generating areas and/or countries and in more developed countries further dismisses assumed direct links between economic conditions and terrorists.
This line of reasoning can best be illustrated by specific examples not necessarily carried by local "terrorist" groups but shows how terrorist acts can be employed by individuals, groups and/or states in order to generate an economic impact.
For one, recent Paris Attacks are viewed, from an economic perspective, to be carried out to spread a sense of fear not only among locals, but also probably more significantly, among international visitors coming for leisure purposes (Laird). In response, authorities, under a clear and imminent danger, are hurried up to impose border controls and more security measures and hence shoring up costs incurred by governments to maintain safety within and beyond borders (Laird). The impact of such economic terrorism is believed, however, to be short-range and is not sustained for prolonged periods (Laird).
The apparently sporadic acts of economic terrorism could, indeed, be initiated by a broad range of actors for different purposes. The recent Paris Attacks appears, for example, to have no direct economic motivations (although a short-range, negative, economic impact has occurred as manifest in temporary closure of borders and cancelled flights). Given current situation, Paris Attacks (and most recently Brussels Attacks) are still developing incidents and, as such, are straining national funds by spending more money on personnel and equipment. More recent revelations are showing broader networks ready to carry out further attacks and hence deepening fears and, not least, increasing strain on security budgets.
Conclusion
Economic terrorism is a broad concept. Embracing coercive acts carried out by states, independent non-state actors or both, economic terrorism is meant to influence economic performance or distracting economic resources in order to cause as much harm as possible for a specific polity and/or group. The U.S. and Saudi Arabia are notable example of coercive economic practices adopted to achieve political and/or economic goals at global and regional levels respectively. By applying sanctions, monitoring bank accounts and/or funding proxy wars, U.S. and Saudi Arabia performs systemic acts of economic terrorism to limit a foe's ability and/or enhance own political and economic clout.
Economic terrorism can, moreover, be carried out by actors motivated by ideological causes but whose acts are of broad economic implications as in recent Paris and Brussels Attacks. Linked, or not, to one or more terrorist group, recent attacks in Europe raise deeper questions about morality of fear. By invoking fear for broader implications, acts of terror, particularly in recent years (and as shown most explicitly in recent attacks) can no longer be readily attributed to specific entities. Yet, for all ambiguity, economic impact remains most felt. The question of morality of economic terrorism cannot, in a final analysis, be overemphasized. If anything, harnessing powers of economic (and, for that matter, psychological) fears are apt to backlash. The current complexities – and, for that matter, contradictions – now experienced by funders of economic terrorism are showing, more than ever before, how money invested in pain returns pain.
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