Financing Terrorism

Public Funding Sources

Prior to the collapse of the Soviet Union, terrorist organizations typically conducted activities within the context of the political rivalry between the Soviet Union and the United States. In this environment, terrorist [Page 138]groups depended heavily on state sponsorship or financial backing from a national government because the goals of the organization were almost always defined in the broad, ideological terms of the Cold War, for example, anti-imperialism, anticolonialism, and so on. During this period, the majority of organizations using terror had as their goal either redistribution of wealth or the attainment of basic political rights against a ruling authority. This meant that, in practice, these organizations had the financial backing of either the Soviet Union or governments allied with the Soviet Union.

The end of the Cold War dramatically has altered the character and the prevalence of state-sponsored terrorism. Groups can no longer use the rivalry between superpowers as leverage for extracting revenue for their operations. To the extent that groups had relied on the Soviet Union, support from Russia has disappeared primarily because the Russian government no longer had a political reason for underwriting groups with disruptive or subversive agendas.

A few terrorist groups continued to receive assistance from national governments. Lebanon's Hezbollah has a very close financial and political relationship with Iran, for example. But this link between terrorist group and national government has become the exception rather than the rule. Unable to depend on financial support from national governments, most terrorist organizations have turned to developing their own financial sources.

Private Funding Sources

One such source involves the solicitation of contributions abroad from those sympathizing with organization goals. Foreign sympathizers may share the philosophical goals of the terrorist organization or they may identify with the ethnic or religious background of the organization. Throughout the 20th century, the Irish Republican Army regularly depended on contributions from Irish Americans. Indeed, Irish revolutionary leaders would sometimes conduct fund-raising tours in U.S. cities, much to the consternation of British authorities.

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