Taliban Gains Money, Al-Qaida Finances Recovering

"Al Qaida has conserved its funding to allow for continued high-value training and plotting," said Carlos, the terrorism adviser. "I think to a certain extent al-Qaida will find ways of funding more things that are important to them. And to a certain extent it might explain a lot of questions of why we haven't seen another major attack on the scale of 9/11 __ in part because of the disruptive effort, part of it is luck and part of it is financing constraints."

Estimates of al-Qaida's annual budget needs vary wildly from $300 million to as low as $10 million.

Carlos, who estimates al-Qaida's needs as "modest," said its big expenses are payments to families; food and shelter to maintain operations; travel and logistics; money for cells engaged in plots; bribes, and expenses for longer-range plans such as an anthrax program.

Some Islamic charities with known al-Qaida connections have quietly renamed themselves and continued to operate. In Pakistan, charities with links to terrorist group Lashkar-e-Taiba and al-Qaida, but operating under new names, have cashed in on natural disasters such as the devastating 2005 earthquake and the current refugee crisis from the Swat Valley to replenish its finances. In Kuwait, the Revival Islamic Heritage Society, believed by the U.S. to heavily finance al-Qaida, still operates.