Buying Out the Insurgency

SWJ Blog post - Buying Out the Insurgency – Re-evaluating the Community De-Weaponization Initiative in Iraq by Malcolm Nance.

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In September of 2003 I went into Baghdad’s Sadr City Ali Baba market (now called al-Nidawi market) for my first illicit black-market arms purchase. Early on outfitting Iraqi soldiers and bodyguards required use of all resources … including the street markets. Every one of my men had their own Kalashnikov, commandeered from Police stations, army barracks or Ba’ath party offices but the ability to sustain them with ammunition, working sidearms, high capacity ammunition magazines and light machineguns was beyond anyone’s capability except for the local black market.

Prior to the invasion, hundreds of thousands of weapons were widely distributed for use by the 400,000 man Iraqi armed forces, regime security forces and Al Quds civilian defense force. The security forces and intelligence agencies created thousands of caches of weapons for the follow-on insurgency. Most caches included several artillery shells, dozens of mortar shells, rocket launchers, automatic rifles, and tens of thousands of rounds of ammunition. Weapons of all types imaginable from the Makarov pistol to the SA-16 Man portable Air Defense Missile System (MANPADS) were cached. They are still discovered daily. In the chaos of the victory of coalition forces over the Iraqi army the population stripped the Iraqi government of well over a million, automatic rifles, light machineguns and heavy crew served weapons...

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Much more at the link...

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Originally Posted by SWJED

SWJ Blog post - Buying Out the Insurgency – Re-evaluating the Community De-Weaponization Initiative in Iraq by Malcolm Nance.



Much more at the link...

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If the concept could actually work in the real world, then I would agree that it would be cheaper to “buy out the insurgency.” It would appear that this tactic could be viable if the weapons supply were truly a closed system. I strongly suspect that paying top dollar would encourage entrepreneurs to import more weapons into the market thus creating a virtually unlimited supply.

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Originally Posted by T. Jefferson

If the concept could actually work in the real world, then I would agree that it would be cheaper to “buy out the insurgency.” It would appear that this tactic could be viable if the weapons supply were truly a closed system. I strongly suspect that paying top dollar would encourage entrepreneurs to import more weapons into the market thus creating a virtually unlimited supply.

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Technically, Iraq is a closed system except for the small flow from Iran to the Mahdi Militia (and we are LOOKING for those weapons) and the Iraqi Army soldiers selling our purchases for the GoI (we would discover the quantitity of those illicit sales also) - entrepreneurs would still be selling to us, not the insurgents and they would also compromise their sources

I have seen no real evidence of large quantities of weapons flowing in from the governments of Syria. Jordan, Turkey but we have seen thousands of Iraqi weapons flowing out into Saudi Arabia to Al Qeada of the Arabian Peninsula (they captured over 2,000 AKs from Iraq in the last few years).

The key is to buy out the public participation in rearming the insurgents and then that cash flow will induce the insurgents (and their wives) to start selling off caches they are aware of ... If there is anything I have learned in Iraq ... the "right" money talks. :D:

This to me seems like one of those ideas that we almost crazy not to have tried. I mean the worst that could possibly happen is that we spend millions and Iraq would still be awash in weapons and gurillas, which is exactly what the current situation is over there. So we have nothing to lose and hay it might work.

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Originally Posted by Abu Buckwheat

Technically, Iraq is a closed system except for the small flow from Iran to the Mahdi Militia (and we are LOOKING for those weapons) and the Iraqi Army soldiers selling our purchases for the GoI (we would discover the quantitity of those illicit sales also) - entrepreneurs would still be selling to us, not the insurgents and they would also compromise their sources

I have seen no real evidence of large quantities of weapons flowing in from the governments of Syria. Jordan, Turkey but we have seen thousands of Iraqi weapons flowing out into Saudi Arabia to Al Qeada of the Arabian Peninsula (they captured over 2,000 AKs from Iraq in the last few years).

The key is to buy out the public participation in rearming the insurgents and then that cash flow will induce the insurgents (and their wives) to start selling off caches they are aware of ... If there is anything I have learned in Iraq ... the "right" money talks. :D:

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An interesting proposal. A few questions about the dynamic effects of the buyback program.

What did you estimate the price elasticities of demand and supply to be? At what point (how many weapons bought back) would the program actually have an effect on the insurgency having arms (e.g. with an insurgency of "20K" for the longest time and over 1,000,000 weapons, it seems that it would take a couple hundred thousand weapons before you start to make it difficult for them to replace their weapons)? How would you judge the market price after implementation since the CDI buyback price would now create a new market price - in essence, a bidding war would be created (having a positive effect in shutting down the smaller and less well funded groups, but I'm sure there would still be groups left standing), with CDI prices having to be higher to reflect the risk of not cooperating with the insurgency? What are the market prices of these weapons in neighboring nations, and at what point does the CDI created price produce too strong of an incentive for arms smugglers not to supply the market and reap the arbitrage opportunity (your example above of arms exports doesn't reflect the regional arbitrage opportunity that CDI would create). While pumping of money into the local economy sounds good, how would you prevent inflation from this monetary injection that would erode the real gain in purchasing power, and what distributional effects would the payments have (i.e. did certain segments of the population steal more cache weapons/ammo, meaning that they will reap the payments, and does this align with whom we are targeting to bring off/over the fence, or will it only exacerbate the current divide by increasing perceived or real equity)?

The program sounds like something that could be a good thing if supply and demand are shaped in a particular way, but is there analysis that supports this? Thanks.

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Originally Posted by Shek

An interesting proposal. A few questions about the dynamic effects of the buyback program.

What did you estimate the price elasticities of demand and supply to be? At what point (how many weapons bought back) would the program actually have an effect on the insurgency having arms (e.g. with an insurgency of "20K" for the longest time and over 1,000,000 weapons, it seems that it would take a couple hundred thousand weapons before you start to make it difficult for them to replace their weapons)? ...

While pumping of money into the local economy sounds good, how would you prevent inflation from this monetary injection that would erode the real gain in purchasing power, and what distributional effects would the payments have (i.e. did certain segments of the population steal more cache weapons/ammo, meaning that they will reap the payments, and does this align with whom we are targeting to bring off/over the fence, or will it only exacerbate the current divide by increasing perceived or real equity)?

The program sounds like something that could be a good thing if supply and demand are shaped in a particular way, but is there analysis that supports this? Thanks.

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Granted a deeper financial analysis has to be done - SWJ is awash with anthropologists and a market analyst is not far behind I am sure.

Look at it this way -the immediate psychological effect on the community of even announcig such a program would be priceless. Again in our early model a good piece of Basra started hording weapons for resale when the NGOs community survey went out. Additionally the Information Operations aspect is to publicise the program and let the market skyrocket ... then honestly attempt to buy it out. The effect will be the same on the insurgent and crimnal -weapons will become too expensive to buy of the Americans pay better. Even if an AK-47 reaches $2,000 and we buy a million of them (which would cost about 1 week of operations in Iraq0 it will always be a better bargain than a lost soldier.

The tipping point of impacting the insurgency would be based not just on the weapons off the community market but the wholesale purchase of their own caches by entrepreneurial insurgents who want a massive amount of immediate cash and an opportunity to leave. We are looking to buy the groups out a cell at a time as in our example from Kirkuk. The logistics pipeline to the varying groups depends on fluidity of the market and trusted agents who will sell ... this removes those supports.

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What are the market prices of these weapons in neighboring nations, and at what point does the CDI created price produce too strong of an incentive for arms smugglers not to supply the market and reap the arbitrage opportunity (your example above of arms exports doesn't reflect the regional arbitrage opportunity that CDI would create).

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The neighboring states are authoritarian or dictatorial in nature and have closed arms markets. Syria, for example has no open arms market though explosives from Iraq have danced across that border for sometime in SVBIED/SPBIED preparation. Some filtration will occur with weapons from those government's own service members or by direction of government agencies but those are taregted by the originating governments to allies in the insurgency (e.g. IRGC EFPs to Mahdi militia). These sources are a trickle and a sudden torrent and the weapons will unmistakeably be part of a campaign that can be a focus of counter-intelligence.

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How would you judge the market price after implementation since the CDI buyback price would now create a new market price - in essence, a bidding war would be created (having a positive effect in shutting down the smaller and less well funded groups, but I'm sure there would still be groups left standing), with CDI prices having to be higher to reflect the risk of not cooperating with the insurgency?

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CDI intends to create a bidding war - a massive one inwhich all the players have to decide which is more important - paying ANY price to fight or taking the money and running ... when it comes to essentially large amounts of cash out we will always win. Even with large amounts of illicit oil revenue in the western provinces the purpose of pushig the market price to astronomical levels benefits us. In fact a UN-style disarmament/destruction program at the end of it with all of the weapons should be our goal. We don't resell or reuse these weapons (since the IZ Army is going to M-16s) we destroy them on TV. People will sell to us and the resellers won't be able to bear that the weapons will not be coming back into the market.

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Originally Posted by Abu Buckwheat

In fact a UN-style disarmament/destruction program at the end of it with all of the weapons should be our goal. We don't resell or reuse these weapons (since the IZ Army is going to M-16s) we destroy them on TV. People will sell to us and the resellers won't be able to bear that the weapons will not be coming back into the market.

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Ship ‘em back to the world. We will be happy to buy for pennies on the dollar.:D


I would assume that the goal is only to purchase truly functional weapons. I understand that gun buy back programs here in the US tend to get flooded with junk being passed off as real weapons.

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Originally Posted by T. Jefferson

Ship ‘em back to the world. We will be happy to buy for pennies on the dollar.:D


I would assume that the goal is only to purchase truly functional weapons. I understand that gun buy back programs here in the US tend to get flooded with junk being passed off as real weapons.

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No, we buy everything and anything ... even broken ones, spare parts, barrels, firing pins, carrying cases, repair equipment ... you would not believe what they had... I was once offered a SILKWORM missile fire control computer. If we don't take it Iran will or already has. We just empty the place of everything.

Seems like a no-brainer.

If there is a replacement channel, it will show up and become a very hi-pri target in itself, besides making the sources of backers clear.

The killing of the $50 m budget is a real classic "pound wise and penny foolish" decision. Shows what happens when petty bean counters get into the Peter Pipeline. :rolleyes: