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Despite the campaign in Afghanistan, Al-Qaeda remains a threat, not only to U.S. interests abroad, but also to the American homeland. A distinguished panel of experts at a recent Nixon Center luncheon concluded that, although its principal base of operations was lost, Al-Qaeda retains its capability to regenerate—and the United States needs to upgrade its intelligence capabilities to counter this continuing danger. Nikolas K. Gvosdev, Executive Editor of The National Interest and Senior Fellow in Strategic Studies at The Nixon Center, and Larry C. Johnson, Chief Executive Officer of BERG Associates and former Deputy Director of the State Department’s Office of Counter-Terrorism, looked at the future of international terrorism in a discussion moderated by L. Paul Bremer, Chairman and CEO of Marsh Crisis Consulting and former Chairman of the National Commission on Terrorism.

Nikolas Gvosdev opened the discussion by observing that the leadership of Al-Qaeda understood that the September 11^th attacks were a strategic gamble. Bin Laden and his associates were willing to risk losing their primary base in Afghanistan because they concluded that a direct strike on the American mainland—something that neither Nazi Germany nor the Soviet Union never accomplished—would severely disrupt American society, force a reassessment of overseas commitments, and demonstrate the fragility of the American-backed regimes of the Middle East. This did not occur. There was no dramatic wave of uprisings against the regimes of the Middle East and South Asia as Al-Qaeda had hoped. Al-Qaeda has lost its main base of operations; the Taliban has been driven from power in Afghanistan; and Bin Laden’s ability to foment unrest in Central and Southwestern Asia has been compromised.

Since 9/11 did not achieve the results Al-Qaeda had desired, other than killing large numbers of Americans, Gvosdev suggested that the organization is evaluating its future course of action, deciding on whether to launch a final set of deadly strikes on the American homeland, or to rebuild by finding new bases to replace those lost in Afghanistan. Ambassador Bremer cautioned that the present "lull" in terrorist activity should not be misinterpreted as a definitive sign that Al-Qaeda has been destroyed by the military campaign in Afghanistan, noting that Bin Laden’s organization normally conducts major operations within a cycle ranging from nine to seventeen months between attacks.

The possibility of closer coordination between Al-Qaeda and other terrorist groups like Hezbollah and Hamas—building up on links forged as early as 1993, according to Larry Johnson—may produce a re-evaluation in strategy. While Hamas and Hezbollah share the same goal of driving the U.S. from the Middle East, they appear to be less willing to strike the American homeland, because they fear jeopardizing their ability to recruit, raise funds, and purchase equipment within the United States. Al-Qaeda may also return to its earlier pattern of operation—trying to cloak its operations within larger conflicts (such as Kashmir or Palestine) and exploiting the "sympathy loophole"—to mask its involvement, as it had successfully done in earlier conflicts in Chechnya and the Balkans. By trying to recast its activities as support for "liberation", Al-Qaeda and other groups seek to divert attention from the larger question of terrorism.

Terrorists need turf, Johnson noted, in order to transport resources, establish facilities, and create logistical networks. Like state militaries, terrorist groups need to train, equip, transport, and coordinate their personnel. Gvosdev called attention to a series of reports that suggest that Al-Qaeda personnel have taken refuge in the tribal areas of Western Pakistan, and are awaiting opportune circumstances to return to Afghanistan. Others indicate that Al-Qaeda may try to find new bases in "failed" states—Somalia, portions of the Balkans, Lebanon, Chechnya— areas where Al-Qaeda can operate with impunity. At the same time, the "developed" world contains "brown zones"—areas where the writ of the state runs sluggishly or is altogether nonexistent—which might serve as bases for terrorist activity. Johnson sketched a portrait of "zones" in the Western Hemisphere—the Colon Free Zone in Panama or the tri-border area adjoining Argentina, Brazil, and Paraguay—as nexus points for smuggling, money-laundering, and other illicit acts.

This raises the entire question of funding. As Johnson pointed out, in the 1980’s, most terrorist organizations relied upon state patrons for financing, not simply the frontline "terrorist sponsors" such as Syria, Iran, and Libya, but especially the Soviet Union. When the USSR collapsed, most terrorist groups folded, as "Uncle Boris’s" checkbook dried up. Others turned to criminal activities. The drug trade, both in Latin America and in Central Asia, has been a major source of funding for terrorist groups, and symbiotic relationships developed, whereby terrorist groups provide "protection" and assist in the transport of drugs to their markets in return for receiving a share of the profits.

Terrorist groups have also become more adept at exploiting loopholes or lax enforcement in Western countries to raise funds, often under the rubric of religious, educational, or charitable foundations. Johnson used the example of a cigarette-smuggling ring in North Carolina as an example of the innovative ways terrorists finance their operations. By illegally reselling cigarettes in northern states with high taxes, Hamas operatives not only diverted profits for terrorist activities, but also purchased equipment in the United States unavailable in the West Bank.

Disruption of the financial networks is imperative if the war against terrorism is to be won. Johnson estimates that since 9/11, up to 70 percent of the bank transfers of funds between Al-Qaeda branches has been disrupted; however, the informal "money-transfer" network, as well as the use of non-monetary commodities (such as diamonds, gold, etc.), means that terrorists still have the ability to finance their operations.

For future success in counter-terrorist operations, the United States must improve and expand its intelligence capabilities and coordination among the agencies. Ambassador Bremer, however, lamented the fact that the U. S. continues to maintain an artificial division between "international" and "domestic" terrorism. Clear lines, however, between "foreign" and "homegrown" groups have blurred, he said. A change in doctrine is therefore necessary in order to allow the agencies involved with intelligence and counter-terrorism to become more effective.

Johnson highlighted the ongoing lack of coordination among the principal agencies, citing past experiences with Colombian groups like the ELN and the FARC. Foreign groups are investigated by the CIA, while domestic organizations fall under the purview of the CIA. However, the DEA handles narcotics investigations. While the CIA is interested in intelligence, the FBI and DEA, as law-enforcement agencies, seek to build cases against individuals and groups that will stand up in a court of law. Greater coordination between these agencies within the context of counter-terrorism is necessary if a terrorist group’s operational capacity is to be eliminated by the disruption of financial profits terrorists accrue from illegal activities such as drug smuggling.

Gvosdev stressed the need for new, more creative means of intelligence collection. Citing the example of "the Trust," a 1920’s Soviet operation which created a "dummy" anti-Soviet resistance movement, he said that the U. S. should explore creating a network of organizations that could infiltrate and gain intelligence on terrorist groups. Human intelligence is critical; attention must be paid not only to recruiting new sources but also creating units patterned after British or Russian "chameleon" units, able to infiltrate and operate in various areas of the world without detection. To achieve these ends, he noted, it may be necessary to re-examine hiring practices so as to be able to tap into the skills, especially the linguistic backgrounds, of recent immigrants. Ambassador Bremer, citing the work that he and fellow commissioner Fred C. Iklé (who also was present) had done as members of the National Commission on Terrorism, noted that their recommendations included scrapping outmoded bureaucratic regulations that inhibit the ability of intelligence agencies to penetrate terrorist organizations.

We no longer face the same terrorist threat as we did in the past, concluded Ambassador Bremer. Unlike their predecessors in the 1970s and 1980s, terrorists now are inclined to inflict mass-casualty terrorism as opposed to isolated or symbolic acts of violence. Terrorists now have access to weapons of mass destruction. Most importantly, terrorist operatives are no longer "foreigners" but, as recent developments have shown, are citizens and permanent residents of the United States.

All three speakers agreed that U.S. activities regarding terrorist agencies must now focus on these differences so that attacks against the homeland do not occur in the future. Intelligence is going to play a key role; improvements in intelligence capabilities, not simply in technical areas, but in developing human sources, will allow the United States to develop a strategy to seek out and destroy the reorganization efforts of Al-Qaeda after September 11^th and the subsequent military campaign in Afghanistan.

There are also other challenges that will need to be addressed beyond Afghanistan. As Johnson noted, the role of Saudi Arabia in financing many of the organizations which, in turn, foster and encourage terrorist groups, and the reality that most terrorist training camps in the world are to be found in Lebanon, in the Bekaa Valley and in the southern suburbs of Beirut are two such issues.

This Program Brief was prepared by Nixon Center Intern Timothy Owens.