EU economic losses in the haze of jihad: Government spending: the political costs of counter-terrorism (part 3) – by Daniele M. Barone

Unsurprisingly, the share of government expenditure grows when terror attacks occur as public spending on defense and security increases.[i]As a consequence, countries have to raise taxes or shift their budget spending to potentially less growth-enhancing defense and security expenditures, which could harm long-term growth.[ii] This may happen because public resources are shifted from output-enhancing to non-productive expenditures.[iii] However, an action bias by the government[iv] is likely if the relevant actors will be able to obtain credit for responding to the risk. Even though not all the costs of CT measures are available on public records, there is evidence that, until 2008, an additional transnational terrorist incident per 1 million inhabitants in a Western European country has led to an average increase of government expenditure by 0.17%, while reduced economic growth by about 0.4%[v].

The political aftermath of 2015 Paris attacks

Immediately after November 13, 2015 Paris attacks, French president Holland declared “We will be merciless toward the barbarians of Islamic State group … the country must take appropriate action” and, as for Bush’s 2001 “war on terror”, to stress the international effort to fight Islamic-inspired terrorism, he declared he would “destroy the Islamic State”.[vi] In this frame, he also announced that France would increase its defense budget by close to €4bn over four years, in response to extremist threats after the Paris jihadist attacks.

Militaristic approach: a necessary disproportionate response

This declaration immediately sparked police operations across the country that brought to 23 arrests and dozens of weapons seized in a series of raids on suspected Islamist militants[vii], meanwhile, at an international level, the French Defense Ministry sent 12 French aircraft, including 10 fighter jets, to lead an air raid coordinated with American forces, and destroyed two Daesh targets in Raqqa.[viii]

Another immediate response of the French Government in terms of military recruitment was the following: keep all the defense personnel (since 3/4 of the volunteers were on fixed-term contracts) and increase to 16,000 recruitments in 2016, while developing five waves instead of three Army’s advertising campaigns in 2015. The unexpected result, in only a week after November 13 Paris attacks, was an extraordinary increase of visitors to French army’s website,, from 2,000 to 20,000 and the tripling of the requests for information and recruitments: from 500 to about 1,500 per day.[ix] An unprecedented phenomenon which brought to receive a total of approximately 160,000 applications in 2015 (against 120,000 in 2014)[x].

Furthermore, public opinion on the military in France improved in every respect. In fact, in a slowly positive trend started in 1990 (and since the terrorist attack, on July 25, 1995[xi], when 8 people were killed and 84 wounded),[xii] positive opinions on the French military branch increased to 87%  in 2016, making France the EU country with the highest level of confidence in the military sector, ahead of Germany, Spain, and Italy, where the average stood at 73% in November 2016[xiii].

In this respect, since France, in 2016, had an estimated 2,000 French nationals having traveled to the conflict zone, a survey by the Pew Research Centre in 2016 highlighted that 91% of French citizens interviewed thought Daesh was a major threat to the country (to become 88% in 2017).[xiv] Indeed, on March 17, after January 2015 terrorist attack, in an attempt to fight domestic terrorists, France’s Interior Minister announced that the Government had cut welfare benefits to 290 French citizens who had left the country to join jihadist groups in Iraq and Syria.[xv]

In this context, France military expenditure, after a constant decrease in 2010 – 2013 (from 56 to 53bn$), due to the enforcement of austerity policies in the EU for 2010 debt crisis and a slightly increase in 2014 (54.5bn$), increased from 2015 until 2017 (56.6bn$ until 60.4bn$).[xvi]

In fact, in the immediate aftermath of 2015 Paris attacks, France spent nearly 1 million euros a day on the heightened security and the increased costs for security represented a roughly 3% growth, taking overall spending to €131 billion. In that same period, the jihadist threat unbalanced also the austerity policies that spread across the EU after 2010 debt crisis. Besides guaranteeing aid to France after the French Government decision to activate Article 42.7 of the Treaty of the European Union (TEU), according to which “If a Member State is the victim of armed aggression on its territory, the other Member States shall have towards it an obligation of aid and assistance by all the means in their power, in accordance with Article 51 of the United Nations Charter”,[xvii] in 2016, European leaders put security spending as a priority. In the first place, the EU Commission, authorized France to receive special treatment under budget deficit rules to strengthen security programs, even after having admonished France the previous year for failing to meet deficit reduction pledges. Indeed, France had originally planned steep cuts in defense spending, forced to save much-needed cash despite the need to ensure security. As part of these cuts, some 34,000 jobs were due to be slashed in the 2014-2019 period but turned to 15,500 after the attacks on Charlie Hebdo magazine[xviii].

Then, the dire need to respond to this wage of fear caused by terrorist attacks perpetrated all over EU brought other Member States to shift towards a security approach. For instance, Germany hired more police and intelligence officers, and German Defense Minister proposed to increase military spending by about $141bn, over 15 years. Also, part of €12.1bn budget surplus was diverted to managing the wave of refugees flooding into the country.[xix]

Deradicalization programs: political and economic costs

Another relevant aspect of EU Member States budget expenditure in the aftermath of terrorist attacks was in the field of deradicalization programs.[xx]

In 2015, the France government announced that in the deradicalization sector 2,680 new jobs would be created and raised the budget by €425mn to the fight against terrorism. The first effort in the developments of counter-narratives led to the launch of website, along with related accounts on Twitter and Facebook. The campaign aimed to highlight the penalties for the promotion of terrorism or other terrorist activities and support the military and stabilization operations of France and its allies in war zones, but rarely engaged directly with jihadist narratives, except during specific campaigns, such as #ToujoursLeChoix #AlwaysTheChoice[xxi]. Despite its large reach (8 citizens on 10) #ToujoursLeChoix campaign also generated suspicion, due to its link to the reporting body of radical behavior, and even provoked counter-campaigns and mockery by some jihadists with the #NoChoice campaign.[xxii]

In the meantime, at a European level, in July 2015 was established the EU Internet Referral Unit (EU IRU)[xxiii] a special unit at Europol, which increased its number of staff employed in 2015-2019 from approximately 950 to 1,300 people[xxiv], aimed to detect and investigate malicious contents on the internet and in social media in order to monitor terrorism online. The unit comprises a team of experts with multiple and diverse knowledge and skills (e.g. experts in religiously inspired terrorism, translators, ICT developers, and law enforcement, etc.). Until 2017, when its annual budget was €4.5mn[xxv], the EU IRU has assessed in total 42.066 pieces of content and, on average, the content flagged for referrals has been removed in 86% of the cases. In May 2016, in France, the deradicalization plan adopted in 2014 was replaced by the PART – Plan daction contre la radicalisation et le terrorisme. An approximately €100mn plan for countering jihadism ideology. It provided 50 new measures that introduced, among other, new priorities as the development of applied research in terms of counter-arguments by involving France’s Islamic community, the improvement of detecting signs of radicalization and terrorist networks at the earliest possible stage, in an attempt to “prevent terrorists from procuring arms and financing”[xxvi], and create a common culture of safety[xxvii].

As part of this action plan, in July 2016, the French government allocated, in a 2-years plan, €40mln to establish new de-radicalization centers across the country. €2.5mln of this budget went to Pontourny, the first French deradicalization center opened in the small village of Beaumont-en-Véron, as the first of 12 others around the country.[xxviii]

It has to be taken into account that, in France, in that period, as more money was being invested in anti-radicalization measures, more individuals got interested in the matter. This phenomenon created the so-called business of radicalization, that caused the emergence of many self-proclaimed specialists, usually not very able to address the phenomenon.[xxix]

This lack of preparation brought to the end of this project in less than a year. The radicalization issue in Pontourny was addressed on the premise that one ideology could replace another and based on the voluntary participation of allegedly radicalized subjects. Furthermore, it caused disorders among the residential areas nearby the center, due to citizens worried for their safety[xxx]. This approach highlighted a lack of knowledge and investments in preventing programs, showing that, differently from the military approach, which generates much more consensus in the short term, de-radicalization is part of a prevention work that requires time and vision that can’t exclusively favor a more securitized rather than a preventive approach.[xxxi]

In September 2017, Macron focused on new programs and pledged additional resources to address conditions that terrorists exploit for recruitment.[xxxii] The plan was fulfilled in February 2018[xxxiii] and, among its innovations, included applied scientific research and knowledge sharing with countries facing the same subject, as well as deradicalization and disengagement in schools and prisons. The 2018 program did not, however, include a social or economic component in favor of disadvantaged cities identified as fertile grounds for radicalization.[xxxiv]

EU-funded programs and budget

In July 2017, through its different funding programs, the EU Commission provided financial support, amounting to more than €300mn, to a large number of projects, within and outside the EU, tackling radicalization[xxxv].

Moreover, the EU established the Internal Security Fund (ISF), an instrument for financial support for police cooperation, which committed between 2014 and 2020 a total amount of €3.8bn. It is composed of two instruments, ISF Borders and Visa (ISF-B&V), aimed at achieving a uniform and high level of control of the external borders by supporting integrated borders management,[xxxvi] and ISF Police (ISF-P), aimed at enhancing the capacity of the EU member States and the Union for managing effectively security-related risk and crisis[xxxvii]. The ISF-P and the EU Commission fund also research projects on radicalization as the Radicalization Awareness Network (RAN), which has earmarked a budget of €25mn over 2015-2019[xxxviii].

About creating a common counter-terrorism approach across EU, between 2002 and 2009, Europol’s budget increased from €53 million to €68 million and, in 2016,  was over €100 million. In this frame, in January 2016, a European Counter-Terrorism Centre (ECTC), a platform by which member states can increase information sharing and operational cooperation, was launched within Europol, following a decision from the Justice and Home Affairs Council of 20 November 2015[xxxix].

Furthermore, since July 2016 Cepol was established, the EU Agency for Law Enforcement Training. The agency, with an annual budget approximately between €8/10mn[xl], operates with the aim to facilitate cooperation and knowledge sharing among law enforcement officials of the EU Member States and from third countries on EU priorities in the field of security.[xli] To facilitate professional networking among EU and partners, Cepol implemented the EU/MENA Counter-Terrorism Training Partnership, which basically consists of training activities and a platform for police and other law enforcement specialists to exchange know-how, latest crime developments, and counter-measures.[xlii]

The EU-funded project, which budget amounted to € 6.5 million in 2019,  has led Cepol to collaborate with the authorities of countries such as Algeria, Jordan, Lebanon, Morocco, Tunisia, and Turkey on issues such as cybersecurity, the fight against online extremism and to terrorism.[xliii]

The dire need for unpopular, supranational, and long-term decisions in counter-terrorism

As seen in France, the mass psychological effects of terrorism brings citizens to demand an immediate reaction of the government to a terrorist attack. Because of this, governments tend to respond with traditional counter-terrorism policies that try to reduce the perceived terrorist threat by increasing the direct costs of terrorism to highlight the visibility of military deployment. Even though the literature suggests that terrorist threats and public spending on CT are linked in a cause and effect relationship, increased spending is not always followed by a reduced incidence of terrorism.[xliv] On the contrary, repressive measures, in the long-term, usually lead to socio-economic costs because of the consequences of restrictions to political rights and civil liberties that are implemented in the hope of countering terrorism. The outcomes of these necessary measures may also disincentivize business activities.[xlv]

These actions should be combined with policies that enhance deradicalization programs which, contrariwise to repressive ones, may take effect in the long run and also require a multidisciplinary and complex approach. Thus, immediately after a terrorist attack, may not be overly popular among the public opinion or policy-makers. However, while CT remains mainly a national policy matter, it is more and more becoming an area of higher priority at the EU level, which is developing and improving over the years. A supranational design of CT measures is more likely to effectively counter international terrorism by overlapping security know-how and information sharing unbalances among EU Member States, providing a democratically legitimized and coordinated long-term vision of terrorism issues, and establishing an appropriate international legal framework on terrorism. 


[ii] T. Brück, F. Schneider, M. Karaisl (June 30, 2007) A Survey on the Economics of Security with Particular Focus on the Possibility to Create a Network of Experts on the Economic Analysis of Terrorism and Anti-Terror Policies and on the Interplay between the Costs of Terrorism and of Anti-Terror Measures – the State of Play of Research. DIW Berlin For the European Commission, Directorate General Justice, Freedom and Security.

[iii]T. Krieger, D. Meierrieks (January 2019) The Economic Consequences of Terrorism for the European Union. Albert-Ludwigs-Universität Freiburg

[iv] C. R. Sunstein, R. Zeckhauser (2008) Overreaction to Fearsome Risks. John M. Olin Program in Law and Economics Working Paper No. 446.

[v] K. Gaibulloev, T. Sandler (July 17, 2008) Growth Consequences of Terrorism in Western Europe. Kylos Volume 61, Issue 3.

[vi] S. Lucas (November 17, 2015) Paris attacks: how effective has the military response been?. The Conversation.

[vii] (November 16, 2015) Paris attacks: Many arrested in raids across France. BBC News.

[viii] A. Rubin, A. Barnard (November 15, 2015) France Strikes ISIS Targets in Syria in Retaliation for Attacks. The New York Times.

[ix] N. Gilbert (November 19, 2015) Ruée des jeunes Français vers les armées. Le Monde.

[x] F. Garza (November 21, 2015) The French military has seen a surge in applications after the Paris attacks. Quartz.

[xi] C.R. Whitney (December 4, 1996) 2 Die as Terrorist Bomb Rips Train at a Paris Station. The New York Times

[xii] É. Jolly, O. Passot (July 2018) Instability and Uncertainty. Strategic Review of Security and Defence Challenges from a French Perspective – FRANCE AND POLAND FACING THE EVOLUTION OF THE SECURITY ENVIRONMENT. Institut de recherche stratégique de l’École militaire – issue 59

[xiii] Ministère des Armées (2017) La perception de la défense dans lopinion publique européenne et chez les jeunes. Annuaire statistique de la défense.

[xiv] J. Poushter, D. Manevich (August 1, 2017) Globally, People Point to ISIS and Climate Change as Leading Security Threats. Pew Research Center.

[xv] Counter Extremism Project. France: Extremism & Counter-Extremism.

[xvi] France Military Expenditure 2010 – 2020. Trading Economics.

[xvii] A. Marrone, D. Fattibene (January 2016) Defence Budgets and Cooperation in Europe: Developments, Trends and Drivers. Istituto Affari Internazionali (IAI).

[xviii] M. Barreaux (April 29, 2015) Paris Attacks Spur France To Boost Budget. Defense News.

[xix] L. Alderman (January 31, 2016) Terror Threats Thaw Budgets Across Europe. The New York Times.

[xx]EU Commission – Research and Innovation (March 29, 2019) Practicies Project Objective H2020-SEC-06-FCT-2016 Research and Innovation Action (RIA) Partnership against violent radicalization in cities Project Number: 740072.

[xxi] N. Hénin (March 2, 2018) Prevent to Protect”: Analysis and Perspective on the French Program to Counter Terrorism and Radicalization. European Eye on Radicalization.

[xxii] L. Bindner (February 1, 2018) JihadistsGrievance Narratives against France. International Center for Counter-terrorism – The Hauge (ICCT).


[xxiv] (2019) Number of staff employed by Europol from 2001 to 2019. Statista.

[xxv] EU Toghter We Project.

[xxvi] (May 10, 2016) Eliminating jihadism is the great challenge of our generation.


[xxviii] E. Souris, S. Singh (November 23, 2018) Want to Deradicalize Terrorists? Treat Them Like Everyone Else. Foreign Policy.

[xxix] H. Mechaï (July 14, 2019) The ‘deradicalisation’ business: How French attacks spawned a counter-extremism industry. Middle East Eye.

[xxx] S. Fillon (September 2, 2017) What we can learn from Frances failed deradicalization center. La Stampa.

[xxxi] B. T. Said, H. Fouad (September 2018) Countering Islamist Radicalisation in Germany: A Guide to Germanys Growing Prevention Infrastructure. International Center for Counter-Terrorism – The Hauge.

[xxxii] (2017) 2017 Country Report on Terrorism for France. US Embassy & Consulate in France.

[xxxiii] (February 23, 2018) « Prévenir Pour Protéger » Plan national de prévention de la radicalisation.

[xxxiv] J. Jacquin (February 23, 2018) Le gouvernement lance un plan tous azimuts de prévention de la radicalisation. Le Monde.

[xxxv] European Parliament (May 2018) The return of foreign fighters to EU soil.

[xxxvi] Internal Security Fund – Borders and Visa.




[xl] Budget, Cepol (2019)


[xlii] (2017) User guide FOR the CEPOL CT 2 EXCHANGE PROGRAMME. Cepol

[xliii] (November 10, 2020) Revealed: The EU Training Regime Teaching Neighbours How to Spy. Privacy International.

[xliv] O.E. Danzell, S. Zidek (August 24, 2013) Does counterterrorism spending reduce the incidence and lethality of terrorism? A quantitative analysis of 34 countries. Dedense & Security Analysis. Volume 29.

[xlv] T. Krieger, D. Meierrieks (January 2019) The Economic Consequences of Terrorism for the European Union. Albert-Ludwigs-Universität Freiburg