Underground Economics

May 17, 2007 at 4:14 pm (Development, Economics, Freakonomics)

In its latest issue, Reason Magazine has an great article by Kerry Howley on Ghetto Capitalists. Howley reviews a new publication by Sudhir Alladi Venkatesh, a sociologist at Columbia University, called Off the Books. Venkatesh’s work explores the illicit (or we might say, “extra legal”) economy in an American, down-town urban sprawl: Marquis Park in Chicago.

Marquis Park’s residents, reports Howley, are

unlicensed hairstylists, ad hoc caterers, tailors, psychics, and accountants, and typically ply more than one trade at a time. They sell clothes, pirated movies, and used kitchen supplies they call “ghettoware.” Others are gypsy cab drivers, janitors, and mechanics. Some make a quick buck taking over abandoned buildings and offering the space for shelter; others make money with promises to keep police patrols away from the same space.

The picture he describes demonstrates that far from the stereotype of lazy delinquents, languishing in poverty due to their own inability or lack of interest in finding gainful employment, the members of America’s lower classes are engaged in ceaseless economic activity to earn a living. And not only that, they are innovating in original ways to increase their yields, such as renting out spaces after dark to protect them from vandalism or hiring employees off the books.

Of course, Marquis Park’s economic life, although “frenetic and buoyant”, is not without its downsides. Police protection is shunned due to the illegality or extra-legality of business, so that residents have little to no help when they fall victim to crime. The informal nature of illicit networks breeds a particular type of insularity, with entrepreneurs and business owners having to rely on familial and communal links for services and supplies. Paranoia rules, as those in the underground economy suppose that all transactions take place along similar lines. And everyone is a potential victim of the drug gangs, operating like a “shadow government”, extorting money from their constituents for security.

So paradoxically, the underground economy is both help and hindrance. It represents authentic economic activity and wealth generation among some of society’s poorest, but at the same time, with every step it removes the participants from the legal economic sector and further ensures their marginalisation. The lack of police protection exemplifies this fact. Residents of Marquis Park cannot call on the police to protect them from crime or from business malpractice because they are outside of the law and many social norms themselves, but equally they cannot step inside the law and society without first pulling themselves from poverty and achieving some kind of personal financial stability, all of which has to be done through extra or non legal means, because they are the only markets within reach.

Hernando De Soto explored the very same situation in the Third World in his famous book, The Mystery of Capital. According to De Soto the legal and institutional frameworks which surround property in the West allow the mobilisation of capital, and without them the poor in the Third World are effectively outside the “bell jar” of western capitalist wealth creation. He notes that vast and vibrant markets exist in all these countries, but that due to the breakdown of the social contract, legal and actual practice rarely meet, meaning that the poor (and even the not-so-poor) are unable to properly exploit their assets in ways which we take for granted.

In these cases, poverty is a self-reinforcing process: the harder one struggles to extricate one’s life from it, the further one is plunged into its depths.

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Blaming Islamism First

May 15, 2007 at 3:11 pm (UK, War on Terror)

David Aaronovitch recently posted this typically excellent article in the TimesOnline. In it he describes one young British man’s journey into the depths of militant Islam, starting with the Young Muslim Organisation UK, and ending up with Hizb ut-Tahrir. The young man is Ed Husain, who has recently published his story in a new book, the Islamist. Aaronvitch quotes Husain, who relates that the jihadists would link Muslim grievances to British foreign policy:

“In years to come the Hizb would argue that every British Muslim difficulty, from terrorism to poor community relations, was the result of British foreign policy. And to this drumbeat other Islamists would march.”

It is, of course, a (depressingly) common belief that somehow Muslims have been driven mad with the horrors of Western intervention in the Middle East; such that they have become easy pray for radicalist factions. But such a formula only holds true if we believe the Islamist’s propaganda. The West has done a variety of things in the Middle East, some of them good, some of them bad, and some of them neither. For instance, France’s consistently shameful behaviour with regards to Iraq, and its complete support of Saddam Hussain. Should Muslims be aggrieved or pleased with this support? Should Islamists? How does this reflect on the United States?

These claims (that Islamic Terror is caused by abusive Western foreign policy), which see the left - and others who should know better - merely repeating jihadist lies, rest not on any serious analysis, but on a kind of folk wisdom. “Everybody knows that America causes terrorism, and that 9/11 was its comeuppance. It is self-evident.” However, there is no reason for anyone to believe the paranoid rantings of extremist Muslim clerics and ideologues. The Middle East has many problems, but to ascribe them all to the West is to absolutely miss the point. It’s also a neat excuse for the failings of one’s own society, and for one’s own self. Blame everybody else first, normally starting with the Jews, the freemasons or the Great Satan. That’s why you feel lonely, that’s why you’re unemployed, disenfranchised, annoyed. That’s why you have to start throwing bombs.

Far from being anti-imperialist freedom fighters, jihadists are actually just the political equivalents of stroppy children having temper tantrums, “it’s not fair, I want it my way!” They are looking for attention and looking for an excuse for their violence. America fills that role admirably. If it were not America, it would be somebody else, because the factors which give rise to Islamic radicalism are not caused by American actions. The factors which give rise to Islamic radicalism are internal to Islamic society itself. Chief among those factors is the religio-political ideology which justifies this violence to the rest of the Islamic community, the terrorists themselves, and to the world in general. Look beyond the proximate causes to those that lie deeper, yes, but when apportioning culpability, remember to blame Islamism first.

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Talking to Jihad

May 15, 2007 at 10:22 am (4GW, Iraq, War on Terror)

GlobalTerrorAlert have posted the translation of an interview with a foreign jihadist, fighting for al Qaeda’s “Islamic State of Iraq”. The interview was originally streamed live via a radical Arabic chatroom on Paltalk and features Abu Adam al-Maqdisi, a Palestinian national.

Al-Maqdisi discusses the global Salafi jihad, local operations and of particular interest to 4GW and 5GW conoisseurs, the propaganda machine of the ISI, describing “brothers” who disseminate Islamist ideology on CDs and video tapes, copying “around 500 - 600 per day”. He also states that his comrades stay in contact with each other and with the larger struggle via internent chatrooms. The contrast between the ISI’s exploitation of New Media and the United States Armed Forces’ self-harming censorship of its own troops could not be more striking. (Via Counterterrorism Blog)

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Religion and War

May 14, 2007 at 2:44 pm (COIN, War on Terror)

This post over at Small Wars Journal is excellent, and even (whisper it) cautiously optimistic. Kilcullen discusses criticism of the US army’s COIN manual, and the Petraeus/Nagl surge more generally. Some writers have theorised that Iraq’s insurgency is uniquely and insanely religious, and as such traditional COIN is unsuitable, being too “soft”. Kilcullen notes that,

…there are three problems with this argument. First, there is solid field evidence that modern counterinsurgency methods, properly updated for the new environment, actually are effective against current insurgencies. Second, insurgents in both Afghanistan and Iraq are not actually particularly religious — certainly, they are no more religious than the societies they are attacking. Indeed, there is an empirical problem with the whole notion of a “religious” insurgency, since almost all historical insurgencies have included a strong religious dimension, so that it is not clear that discrete “religious insurgencies” actually exist as observable phenomena. And third, doctrinal publications are not templates, but generic expositions of principle; not cookbooks, but frameworks. Practitioners must populate these frameworks with current, locally accurate, deeply understood insights into the societies where they operate. There is simply no substitute for what we might call “conflict ethnography”: a deep, situation-specific understanding of the human, social and cultural dimensions of a conflict, understood not by analogy with some other conflict, but in its own terms.

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Currently reading

May 11, 2007 at 4:51 pm (Reading list)

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Future War

May 11, 2007 at 4:25 pm (4GW, War on Terror)

Democracies don’t like war. They are squeamish about casualties and in the modern world, with its globalised news organisations, the internet and near instantaneous communication, when they go to war they see a lot of casualties. Jihadists understand this and have devised their assault accordingly. Terrorists’ media orientated attacks strike at the heart of the Western “centre of gravity”, i.e. its political will and motivation. Unfortunately, it seems impossible to protect this centre of gravity because of the inherent openness of Western society. And because of the inherent closed-ness of Islamic society (lack of a free press, little history of self-criticism, parallel cousin marriage, etc), because non-state or sub-state actors (Hamas, Hezbollah, Quds, etc) are being protected but not controlled by sovereign nation states and because of the proliferation of international terror networks (al Qaeda et al), clandestine by nature, it has also proved impossible for the West to locate and strike the terrorists’ centre of gravity. Bad news for the free world.

Terrorist tactics have evolved with the emergent “cyber-“ or “network-“ paradigm (globalised information channels and associated technologies, so radicalised youth in Beeston can be watching jihadist footage of IED attacks on American soldiers the very next day) and in reaction to the extreme discrepancy between their own and Western (especially US) forces. In short, jihadist terrorism is a response to the western way of war, utilising, ad hoc but with much success, western technologies. Whilst obviously medieval in their political and religious philosophies (and utterly barbaric on the battlefield: mass slaughter of civilians, revenge rapes and so on way past the point of nausea), jihadist terrorism nevertheless represents the utmost in modernity in terms of warfare.

There are numerous prescient examples of the superiority of the jihadist netwar or fourth generational warfare (4GW) approach (Iraq obviously), but perhaps the most relevant is the recent Israeli offensive in Lebanon. Hezbollah will never succeed in defeating Israel in open battle, but using 4GW methods and tactics managed to repulse Israel, inflicting heavy casualties and winning important military victories, to further damage Israel’s reputation on the international stage, to improve their own image on the Arab street, and to emerge in a stronger position than before as the most powerful terrorist organisation in the world.

Clausewitz noted that defensive war is easier than attack, and surely neither Hamas nor Hezbollah will be rolling the tanks through the streets of Jerusalem. However, success in open battle is not necessary (or feasible) at this stage. What we are witnessing is engineered shifts in the balance of power. Israeli Defence Force doctrine states that one of the goals of the IDF is to project the image of overwhelming force in order to discourage further attacks by Israel’s many enemies. But Hezbollah have made the IDF look weak: defeatable. That is an important victory in itself, for jihadism in general and not just for Hezbollah in particular.

Hezbollah utilised highly committed soldiers, unafraid of causing mass civilian casualties (on any side), created a network of short range artillery and fighters dispersed and concealed across the whole of mountainous southern Lebanon, and of course probably most importantly, through its media wing, al Manar, was adept at using mass media and modern communications networks to manipulate public opinion both in the West and the Middle East. The group was able to fire its automated rockets at large civilian targets in Israel, shutting down cities as their inhabitants hid from the random attacks in bomb shelters, whilst hiding its firepower near civilian targets in Lebanon. They skilfully pounced on any civilian casualties of Israel’s response, and used the furore to erode public support for Israel and to generate an international movement to halt the Israeli offensive. That is to say, Hezbollah mobilised an international pro-jihadist network, a fifth column dedicated to attacking Israel’s centre of gravity, its political will. Hezbollah successfully dilated the battlefield and won a defensive fourth generation war.

War continues to evolve, and the diverse dispersal of jihadist centres and networks, its cells and its media, forms a vast architecture: a rhizomatic web dedicated to fighting this new, future war. Hezbollah is but one part of this structure and its success in the Lebanese theatre last summer provides an important model of how a jihadist group, relatively well funded, armed and lead, can defeat a nominally much superior modern western military machine. And a victory for jihadism anywhere is a victory for jihadism everywhere in the ongoing cultural war, helping to form the ongoing narrative of jihad. In order to win the War on Terror the political will to do so must be generated and protected; oppositional narratives must be formed and inscribed upon the cultural landscape. The West must locate and reach out to the terrorists’ own centre of gravity: public opinion in the Middle East and in the wider Muslim Diaspora. The West needs its own fifth column, and its own fourth generational warriors capable of fighting the future war.

As it stands, no terrorist group, no state or non-state actor, could fight and win a conventional war with the West. However, according to standard insurgency principles (by now: see Mao for the origins of this theory), and looking at jihad as the “long war”, we are at Phase I of its attack on the West: the Strategic Defensive. Jihadism will continue to build strength politically and militarily, wage asymmetrical 4GW, attack the political will to confront it, and try to shift the balance of power until it is strong enough to engage the West in conventional open battle.

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The future is armed to the teeth and is highly motivated, it is dispersed across an ever wider landscape, and it is not waiting for us to arrive: it has begun its relentless assault regardless, chanting the ancient slogans of religious bigotry and blood for a vengeful god. Unless we step into it and learn to fight the future war more effectively than our enemies, we have already lost. For just as he who controls the past controls the future, he who controls the future, also controls the past.

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Greetings

May 11, 2007 at 4:18 pm (Uncategorized)

Welcome to the House of War blog.  I plan to write about the War on Terror, 4GW, economics, science and politics as well as art, literature, music and whatever else takes my fancy, all from a hawkish, libertarian, radical-capitalist perspective.

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