Welcome to Islamic State 101: What Makes ISIS Tick

By controlling territory, managing finances and recruiting relentlessly, Islamic State has made itself unique in the world of Islamist terrorists.

The Islamic State of Iraq and the Levant (ISIL) has become akin in the western imagination to the sociopathic murderers that you would typically see in Homeland—those who would think nothing of rounding up other human beings, torturing them over days or weeks for the masochistic pleasure of inflicting pain and then killing them in front of a video camera. The organization that swept into Fallujah in January 2014 and into Mosul in June 2014—that has been running its own personal fiefdom across vast sections of western Iraq and eastern Syria for over a year—represents the type of indiscriminate and wholesale slaughter that would make Abu Musab al-Zarqawi proud.

The Islamic State, however, is unique from any other Islamist terrorist group on the planet. It has demonstrated an unparalleled capacity to hold and administer territory despite the constant danger of U.S. airstrikes, as well as an ability to create and maintain an extensive system of taxation, extortion and oil production to finance its operations and compensate its fighters. It has demonstrated talent in the social media space, where battlefield successes are broadcasted to young, disillusioned recruits all over the world. ISIL’s massacre on the streets of Paris, as shocking as the attacks were, is just the latest escalation in violence that the group has exhibited every day in Syria and Iraq.

ISIL’s Money Making Machine

The Islamic State’s capture of crude oil fields in Deir ez-Zor and its ability to produce and transport the oil to middlemen and smugglers along the Syria-Turkey border is the most graphic illustration of how the organization makes its money. Before the United States increased the pace and scope of its air campaign, the U.S. Treasury Department estimated that the Islamic State made roughly $1 million per day in profit from oil sales (that estimate now stands at $500 million per year, according to the Treasury Department)—a cash flow that any terrorist organization could only dream of. Operation Tidal Wave II, launched by the counter-ISIL coalition in late October, is designed to degrade that revenue stream significantly; as of November 24, 2015, U.S. and French aircraft have destroyed or damaged hundreds of trucks that ISIL has come to rely upon to transport its oil to the border.

Oil, however, is not ISIL’s most profitable enterprise. Taxes on local businesses, on truckers who drive through ISIL-controlled territory, on bank transactions and deposits, as well as extortion of the local population are the preferred means to pay the salaries, overhead costs, service delivery and administration of the Islamic State’s caliphate. Taxes on a single truck of goods can range as low as $200 to as high as $1,000 depending on the load. Pharmacies in Mosul are taxed on every prescription drug that is sold to customers. Business owners get shaken down for money if they want electricity or plumbing services.  And if the Islamic State is fortunate enough to take a city with historical antiquities, those artifacts are horded and eventually sold for hefty profits—another windfall that has generated tens of millions of dollars for the organization.

Recruitment capacity

Obama administration officials insistently remind the American people and U.S. allies that the Islamic State is not “ten-feet tall.”  With the right combination of air power, professional boots on the ground that are from the local community and a worldwide attempt to stifle their finances, the group’s territory will eventually shrink to the point where the caliphate is no longer a large patch of territory but rather a scattershot, temporary occurrence.

Deliberately downplaying ISIL’s military and financial prowess may be good public relations from a political point of view, but it has done nothing to significantly block the journey of thousands of recruits from the Middle East, the Caucasus and Europe into Syria and Iraq to sign up with the organization. Indeed, the strength of the organization depends on its large collection of foreign fighters who have chosen to make the journey to Syria and Iraq. In one of the most extensive studies into the Syrian civil war’s foreign fighter phenomenon, Richard Barrett of the Soufan Group estimated in June 2014 that approximately 12,000 foreigners from 81 countries are either fighting with the Islamic State or some other radical extremist faction on the ground. ISIL’s bankroll and slick propaganda in jihadist media circles have allowed the organization to attract many of those recruits.

Washington’s claim that roughly 10,000 ISIL fighters have been killed over the first twelve months of the counter-ISIL operation is of little solace given the fact that the CIA’s assessment of ISIL manpower (20,000 to 32,000) is roughly the same as it was when the war began. To put it bluntly: ISIL’s attraction to young Muslims in Europe, Russia, the Central Asian republics and the Middle East is so powerful that Abu Bakr al-Baghdadi has been able to sustain his overall force level despite thousands of coalition airstrikes and billions of dollars spent by the United States, Europe and other members of the sixty-plus member coalition.