This isn't really a stock market or investing post, but it could have far-reaching implications on multiple sectors of our market, our national security, and international policy in general. Besides, it's on my mind and sometimes writing these things out are the best way to exorcise them from my mind.
Will these popular revolts spell the end of Al-Qaeda?
Al-Qaeda promotes the psuedo-historical fantasy of “rebuilding” a caliphate throughout the Muslim world of Africa, the Middle East, and Central/South Asia. In part, Al-Qaeda succeeds through exploiting popular hatred of existing regimes, branding them as anti-Islamic and stooges of the Western world and Israel. Key, then, is a sense of oppression and a stifling of religious expression among the population of these countries.
Now, though, people are rising up and attempting to throw off rulers/dictators that in many cases have been in place for decades. In many of these countries, the rulers have suppressed political Islam as a means of holding onto control. Problematically for Al-Qaeda, though, is that it is not the religious establishment that is leading these revolts, and the impetus seems much more secular than theological. Instead, this looks to be a byproduct of a mix of economic frustration, a sincere longing for new government, and perhaps some sort of self-reenforcing mass social-media movement.
So what does Al-Qaeda do now? Maybe the unsettled masses will choose religious leaders to replace their former dictators, but that doesn't seem especially likely. In almost all cases, it seems like people sincerely want to elect their own leaders and want candidates that are competent, honest, and moderate – not religious demagogues.
But that's a big problem for Al-Qaeda – if people now have a choice and they actively choose against the sort of theocratic conservatism that is the stuff of Al-Qaeda's fantasies, that largely repudiates their whole legitimacy (however scant and pathetic that already is). Moreover, it leaves Al-Qaeda with basically only one option – overthrow new democratically-elected (and presumably popular) governments and forcibly replace them with theocracies.
Easier said than done … particularly when a lot of the Western world would rise up to support and defend those newly-elected democracies (assuming they're largely pro-Western or at least publicly anti-Al-Qaeda. Making matters even more problematic is that the armies in many of these revolting countries has shown remarkable restraint towards protestors – suggesting that they really are sensitive to the will of the people and would be less likely to participate in a violent theocratic coup.
A frustrated and impotent Al-Qaeda seems like a consummate good news-bad news situation. Desperate people do desperate things, particularly when they feel their very survival is at stake. So, a marginalized Al-Qaeda would likely be desperate to strike a high-profile target and once again capture the hearts and minds of the man on the street. That's a clear threat not only to the safety of people living in the West, but also insurance companies, airlines, and other companies that rely upon a confident consumer (in other words, think of the companies that suffered most in the wake of 9/11).
Longer term, if Al-Qaeda is really on the ropes, that changes the game for the U.S.. Hundreds of millions of dollars have gone into the fight against terrorism, and it is uncertain if Congress would continue to allocate huge sums of money if the threat were seen as “yesterday's news”. I'm not suggesting it would be smart to stop spending on counter-terrorism just because Al-Qaeda is weakened, but Congress does not often do what's smart – once people believe the threat is gone, they'll vote against those Congressmen who continue to push for lucrative contracts for electronic warfare and surveillance companies. So, companies that have done well serving the post-9/11 needs of the Pentagon and CIA may find a more difficult world.
On the flip side, an obsolete and impotent Al-Qaeda would be good for just about everybody else. At the corporate level, it would be good for insurance companies, airlines, shipping companies, and banks. It would also likely mean cheaper oil and a better chance at economic growth for countries like Pakistan and the Central Asian republics, certain African countries, and perhaps even Indonesia.
Of course, it would be an even better boon for humanity. But then, I don't think I need to go on at any length about how the world would be a better place with fewer people in it trying to force others to adopt their political and religious beliefs and being willing to kill for it.
So, just food for thought. While these revolts across the Mid-East and Africa are definitely cause for concern and a short-term threat to energy prices and investors' peace of mind, there could be brighter days ahead. Not only might these revolts give tens of millions of people the chance to have a voice in their government and more say in their own economic destinies, but it could ultimately make the world a safer place.
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