NCPA - National Center for Policy Analysis


March 13, 2007

U.S. investors have begun to recognize money is the lifeblood of regimes that sponsor terrorism, and cutting off their cash-flow is not only prudent, but a matter of life and death, says Frank J. Gaffney Jr. in the Washington Times.

The magnitude of the sums involved is frightening, says Gaffney.  According to the Center for Security Policy:

  • As of August 2004, roughly 100 of the leading American public pension funds alone had some $188 billion invested in companies that partner with terrorist-sponsoring regimes.
  • Not all that money was flowing to our enemies, but the Center's study indicated roughly $73 billion was at that juncture.

As a result, several initiatives have come into play, but while welcome, they simply do not go far enough, says Gaffney. For example:

  • Some believe the focus of terror-free investing efforts should be confined to the relative handful of companies helping the Iranian energy sector with projects worth more than $20 million.
  • This approach would leave unaffected the roughly 325 mostly foreign-owned and -operated companies helping build Iran's infrastructure by developing dual-use (military and civilian) industrial capabilities, heavy manufacturing, etc.
  • It would also invite companies to play games with their bookkeeping to allow them to assist Iran's energy programs while remaining, nominally at least, below the threshold.
  • In addition, it would give a pass to the governments such as Sudan, Syria and North Korea and their corporate conglomerates who take U.S. currency and finance terror with it.

It is shameful that Wall Street has developed countless indices (environment, tobacco, etc.) in response to investor demand, but has left terror-free instruments relatively untapped, says Gaffney.  If elected representatives and Wall Street respond, the vast sums Americans have in the capital markets can become a strategically vital, morally sound and fiduciarily responsible tool for hurting terror's friends and our enemies, says Gaffney.

Source: Frank J. Gaffney Jr. "Invest terror-free," Washington Times, March 13, 2007.


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