Nationalism and racism, the fostering of paranoia and grievances are excellent tactics of mobilization of foot soldiers. And the needs to dispense with a continuous stream of patronage and provide venues for the legitimization of illegally earned funds delay essential reforms and the disposal of state assets.

This urge to become legitimate - largely the result of social pressure - leads to a deterministic, four stroke cycle of co-habitation between politicians and criminals. In the first phase, politicians grope for a new ideological cover for their opportunism. This is followed by a growing partnership between the elites and the crime world. A divergence then occurs. Politicians team up with legitimacy-seeking, established crime lords. Both groups benefit from a larger economic pie. They fight against other, less successful, criminals, who wish to persist in their old ways. This is low intensity warfare and it inevitably ends in the triumph of the former over the latter.

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XX. The Economics of Conspiracy Theories

Barry Chamish is convinced that Shimon Peres, Israel's wily old statesman, ordered the assassination of Yitzhak Rabin, back in 1995, in collaboration with the French. He points to apparent tampering with evidence. The blood- stained song sheet in Mr. Rabin's pocket lost its bullet hole between the night of the murder and the present.

The murderer, Yigal Amir, should have been immediately recognized by Rabin's bodyguards. He has publicly attacked his query before. Israel's fierce and fearsome internal security service, the Shabak, had moles and agents provocateurs among the plotters. Chamish published a book about the affair. He travels and lectures widely, presumably for a fee.

Chamish's paranoia-larded prose is not unique. The transcripts of Senator Joseph McCarthy's inquisitions are no less outlandish. But it was the murder of John F.

Kennedy, America's youthful president, that ushered in a golden age of conspiracy theories.

The distrust of appearances and official versions was further enhanced by the Watergate scandal in 1973-4.

Conspiracies and urban legends offer meaning and purposefulness in a capricious, kaleidoscopic, maddeningly ambiguous, and cruel world. They empower their otherwise helpless and terrified believers.