I think there is a correlation between the spiral of terror that Steve talks about and the similar spiral in Islamist extremism. There is a belief that they are not being successful because they are not Islamist enough so they ratchet up their religious requirements. That explains the Taliban effect of certain of the movements and al Qaeda especially. The same thing happens in their fighting where the violence is also ratcheted up. Think of it in terms of corporal punishment of the incorrigible. You keep trying to inflict pain until you get the results you want. The enemy's hearts and minds campaign seems to be based on a theory Chuck Colson espoused during Vietnam--"When you have them by the balls, their hearts and minds will follow."

In both the religious and fighting aspects, the spiral is based on their failure not the success of their operations. When your goal is intimidation and you are failing, the enemy's answer is to be more intimidating. Hey, it kept Saddam in power for a long time.