John Yoo, AEI visiting scholar and professor of law at the University of California–Berkeley, delivered the last of the 2004–2005 Bradley Lectures on June 6. Edited excerpts follow.

Failed states constitute one of the great challenges to international peace and security. The response of the West and of the international legal order has been to impose a nation-state framework on these troubled areas. The West has erred in assuming that because strong nation-states are the guarantors of international stability, every territory must have a nation-state. State failure may indicate, however, that a territory or people may not be best governed by the nation-state structure. If one agrees that failed states beget negative consequences for the international system as a whole, public-choice theory predicts that interventions in failed states will be under-supplied by individual nation-states. The international legal system--by requiring that intervention be followed by a transition to independence and full sovereignty as a nation-state--only makes this situation worse by imposing a rule that increases the costs of intervention, which will further depress actual interventions.

A similar phenomenon occurs with regard to the maintenance of state borders. International law forces intervening nations to bear high governance costs. Yet, there is no natural reason why the borders of failed states ought to be accepted as a given. Economists Alberto Alesina and Enrico Spolaore have proposed that the size of nations is determined by the trade-off between benefits of larger scale--such as defense, law and order, and free trade markets--and the costs created by heterogeneity of preferences within a nation. Security and free trade are precisely the international public goods that the United States has supplied for more than a half-century. By playing a hegemonic role, the United States has created the exact conditions to encourage fragmentation--a development it opposes by keeping nations intact.
 
The United States should explore other forms of governance for failed states, seeking primarily to guarantee internal security and the functioning of effective markets; its goal should be to restore sufficient order in a failed state to prevent it from becoming a base for terrorism. It should also allow failed states to break up along ethnic or religious lines. These policies will reduce the costs of intervention, which should allow for the removal of more territory from the grasp of terrorists.

Network Warfare

We tend to conceive of al Qaeda as a top-down hierarchy; it is better conceived of as a network, however. Its characteristics are typical of what is known as a free-scale network, made up of nodes connected to each other for some purpose. These networks do not have command-and-control hierarchies, but instead are organized around hubs, which are nodes that have a high number of connections to other nodes. The networks are also dynamic; if a node or hub disappears, nodes may simply move their connections to others. Free-scale networks remain remarkably immune to attack; randomly destroying nodes will not cause one to collapse.
 
Two tactics can prove effective in destroying such a network, both of which would involve changes in our legal approaches to covert action in the war on terrorism. The first and perhaps easiest is destroying the hubs of the network. Only a coordinated, simultaneous attack on some of its major hubs can cripple a network, leaving its pieces isolated and relatively harmless. In wartime the military may legally kill members of the enemy’s armed forces and any civilians who take part in hostilities. It is important that we continue to consider the war against al Qaeda a war and not as a form of a persistent social condition like crime.
 
Second, the United States could attempt to create a competitor network to al Qaeda. Al Qaeda nodes provide recruits for terrorist operations and financiers who raise funds for training and attacks. One way to destroy a network is to cause those nodes to switch to another network, much in the way that competitors in the market for computer operating systems seek to convince users to change over.
 
This would require some change in the way the United States deals with religion--the United States would have to act more aggressively to discredit fundamentalist Islam, which it should be able to treat like any other hostile ideology.

Another tactic would be for our intelligence agencies to create false flag terrorist organizations that would compete with al Qaeda. To sow confusion within al Qaeda’s ranks, it would cause nodes to doubt the identity of others and to question the validity of communications and contacts. Acts required to do this may fall afoul of different federal laws. Rules prohibiting fraud, interference with the security of the Internet and banking systems, and cooperation with former terrorists might have to be changed or interpreted to exclude operations designed to undermine terrorist groups hostile to the United States.

I hope that these ideas, drawn from different trends of thought in international economics and network theory, can prove useful in re-energizing the offensive against al Qaeda and its allies.