The problem with loyalty leases

By Dave Anderson:

Bernard Finel looks at the current ISAF focus on the $10/day Taliban and notes that there are a few significant problems with renting out the non-hardcore's loyalties for a few months:

Second, unless you plan to put every man of fighting age on the payroll, there is little evidence that you will eliminate their ability to recruit.  There is also a horal hazard problem here, also.  If we pay off former-insurgents at a higher level of pay than is available through normal economic activity, you create an incentive to punch your ticket as an insurgent in order to get into a DDR program.

Third, what is the long-term here?  You out-compete the Taliban financially for the loyalty of apolitical fighters.  Then what?  The reality is that this creates a durable political economy that supports violence and warfare.  There is going to be an entire class of people whose well-being depends on continued payments, and who have the ability to extort more money simply by turning back to violence.  This is the institutionalization of an extortion scheme.

We have seen the reintroduction of significant violence and targetted high value/high ROI attacks in Iraq as the cash flow that had helped to solve significant problems has halted.  Michael Schwartz at Toms Dispatch looks into the oil pipeline politics of Iraq (h/t Fabius Maximus):

During the Bremer administration, the U.S. had ended the Saddam-era tradition of allowing local tribes to siphon off a proportion of the oil passing through their territory.  The insurgents, viewing this as an act of American theft, undertook systematic sabotage of the pipeline, and � despite ferocious U.S. military offensives � it remained closed for all but a few days throughout the next five years.

The pipeline was re-opened in the fall of 2009, when the Iraqi government restored the Saddam-era custom in exchange for an end to sabotage. This has been only partially successful. Shipments have been interrupted by further pipeline attacks, evidently mounted by insurgents who believe oil revenues are illegitimately funding the continuing U.S. occupation.....

And also the "success of security" in Baghdad is an illustration of the ability of Sunni Arab groups to control the flow of violence in order to argue that they deserve greater security rents. 

If the objective is controlled chaos to find a decent interval, paying off proxies and leasing loyalty is a great idea.  If there is any other objective, there are significant sustainability concerns.