The economics of terrorism

 Economics and money play several large and important roles in terrorism. When taken from the terrorists point of view, there are a couple main and primary roles which can basically be broken down into two categories, the first is funding and the second is motivation. Then, from the point of view of those being affected by terrorism there are a couple more major factors, the first is costs going to damages and repairs, the second is the cost of counter terrorist initiatives.

Now, because of the nature of terrorism, money is less of a motivator than it would be in crimes or wars. There are usually more religious motivators but there are some situations where money is factor of the motivation. If the situation is terrorism to get a point across then money generally does not mean much but if it is a terrorist act where the objective is to scare people into giving money, it comes more into play however money is not always a motivator.

Money come a lot more into the picture with financing. Now with any organization, there is usually a need for financial resources and assets to fund operations and keep things in business and terrorism is no different. With the need for weapons and equipment, there is an obvious need for money to obtain materials. There are several ways that terrorists (in this case focusing more on cells from the middle east) continue to get financing. One is religious donations which makes up a good percentage of the money contributed. A fair amount also comes from ransoms and smaller operations. The cost of terrorism is so significantly dwarfed by the costs of rebuilding (strictly financial, not even beginning to talk about loss of life). For example, a bomb that would be detonated by a wearer can presumably cost around 150 dollars (U.S.) where as the damage from it could be anywhere from two thousand to two million dollars in damages.

When it comes to damages, the September 11^th attacks of 2001 ranks high as far as the total price tag. Some research shows that it is on the high side of one to two trillion (with a “T”) dollars. Here are some of the “big ticket items” from http://www.iags.org :

• The loss of four civilian aircraft valued at $385 million.
• The destruction of major buildings in the World Trade Center with a replacement cost of from $3 billion to $4.5 billion.
• Damage to a portion of the Pentagon: up to $1 billion.
• Cleanup costs: $1.3 billion.
• Property and infrastructure damage: $10 billion to $13 billion.
• Federal emergency funds (heightened airport security, sky marshals, government takeover of airport security, retrofitting aircraft with anti-terrorist devices, cost of operations in Afghanistan): $40 billion.
• Direct job losses amounted to 83,000, with $17 billion in lost wages.
• The amount of damaged or unrecoverable property hit $21.8 billion.
• Losses to the city of New York (lost jobs, lost taxes, damage to infrastructure, cleaning): $95 billion.
• Losses to the insurance industry: $40 billion.
• Loss of air traffic revenue: $10 billion.
• Fall of global markets: incalculable.

When it comes to counter terrorist efforts, the amount of money the U.S. In particular has allocated every year has grown since 2001. In 2008, the world had spent around 70 billion dollars (U.S.) to try to counter terrorism (since 2011). The figures show that it probably reduced the number of international incidents by 34%, yet terrorism has claimed more peoples lives every year.

Clearly terrorism is an economic issue (slightly more on the side of the “receiving” end of things which can not be simply analyzed and calculated.

Works Cited

4, 2006, April. "Tracking Down Terrorist Financing." Council on Foreign Relations. Council on Foreign Relations, n.d. Web. 12 Nov. 2013.

"Ab_cj_terror_1|Why? Understanding Terrorism and Terrori|How Do Terrorists Get Their Money?" Ab_cj_terror_1|Why? Understanding Terrorism and Terrori|How Do Terrorists Get Their Money? N.p., n.d. Web. 12 Nov. 2013.

"The Cost of September 11." The Cost of September 11. N.p., n.d. Web. 12 Nov. 2013.

"The Economics of Terrorism." Core Economics. N.p., n.d. Web. 12 Nov. 2013.

"Is Counterterrorism Good Value for Money?" NATO Review. N.p., n.d. Web. 12 Nov. 2013.

"Ten Years after Sept. 11 Terrorist Attacks, $667 Million in Funds to Revitalize Lower Manhattan Remains Unspent." NY Daily News. N.p., n.d. Web. 12 Nov. 2013.