Roots
Terrorism as we know it today has its roots in the era of the Cold War. At the close of World War II, the political paradigm amongst nations was one of war and global conquest. Also, at that time, a deadly, new weapon had made its appearance on the scene - the atom bomb.
The Cold War
It was clear to every nation that whoever had supremacy of nuclear arsenal would win the next world war. And there were two nations that led the race - the USA and the USSR. It was extremely important to both these nations that it was ahead in the race.
During the 1950s and 1960s, both the USA and the USSR increased their stockpile of nuclear weapons, amassing warheads, building intercontinental ballistic missiles, building anti-missile technology and so forth. The arms race was on.
But the arms race was clandestine. No one knew how far ahead or behind they were of their competitor. There was considerable paranoia in the minds of the US public about the imminent threat of nuclear attack by the Russians. This paranoia (possibly cultivated, possibly real) allowed governments to spend large parts of their state budgets on getting ahead in the arms race and building defenses.
For example, the internet was born out of this effort - the problem being solved (for which the internet was the solution) was this: how can we build a computer systems communications infrastructure which will not fail even if there is a nuclear attack by the Russians.
Another fallout of the arms race was the CIA. This was an agency that was supposed to make sense of all the information that was gathered by the various American intelligence gathering agencies. That's why it was called the Central Intelligence Agency. The mandate for the agency was to create, out of all the information it gathered, a comprehensive picture of how far ahead the USSR was in the arms race.
However, the CIA was not very successful with this. The information was typically encrypted and scanty sometime, irrelevant at other times and there was just so much information that it couldnt really make much of a picture out of it. At the same time, the USSR was consolidating the "sphere of communist influence" through political ties with the iron curtain countries. The USA had to do the same. And the CIA had a big part in this.
Although the supporters of USA and the USSR were largely defined, there was always the attractiveness of increasing the sphere of influence for both the countries. With the USSR leadership having enormous unquestioned decision making power, there was no call for justifying its actions in world affairs. But the leadership in the USA was answerable to the press, the public, the judiciary. It would have been a losing battle to engage in these unequal terms. The CIA leveled the playing field. The CIA was not answerable to any body; they had a budget that they managed themselves.
Both countries increased their sphere of influence in the world by manipulating the governments in different countries. The USA was instrumental in manipulating the governments in Latin America while the USSR did the same in Asia. Both countries meddled in the affairs of the middle east.
Drugs
The modus operandi for manipulating the government in any country was to find a political group that was agreeable to be included in the sphere of influence and then fund them and train them to overthrow the established government. Now you had a government that supported you.
However, there was a side effect of this strategy. The ousted government was a strong force that had gone underground. This established one or more militant outfits in a large number of countries that wanted to get into power. This led to civil war.
But war is an expensive business. How do militant groups get money to fund their operations? There are many ways, but the largest source of money is drugs. This led to the establishment of the drug trade. The growing of poppy, the processing of opium, the supply and distribution of the end product, heroin all came together. In fact, this became so lucrative, that it gave rise to private interests to incite civil wars.
Find a country that is susceptible to internal conflict, fund a militant group initially and then when they wanted money, they would participate in the drug trade. Thus increasing the supply chain.
Going Global
So, now you had militant groups funded by the USA and USSR as well as drug lords all over the world. Money laundering became commonplace to get drug money into the normal economy so that erstwhile drug lords would be able to retire as honourable citizen in some developed country.
Also, most of the militant groups were trained by the likes of the CIA and KGB in the latest technologies and latest techniques. The stage was set for globalization.
The militant groups now had a viable economic model based on drugs. They could now turn their attention from their local conflicts to larger, global goals. One form of the global goal we have seen is that of al queda - to drive American influence from all Muslim nations. This is a trans-national initiative. And the members are completely international: there isnt any major country that can claim to not have Al Queda establishments in it.
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