This book is a comparative study of U.S. efforts to assist allied nations in counterinsurgency through indirect intervention, with a specific focus on how external aid can induce political, economic and military reform as part of a broader counterinsurgency strategy. A critical error lies at the heart of the U.S. Counterinsurgency manual, FM 3-24, and much of the literature it draws on: the erroneous assumption that it will be comparatively easy for a patron state to shape the counterinsurgency strategies of the client government it is supporting because the priorities, goals and interests of the two parties will be closely aligned. In fact, history demonstrates that is rarely the case. Critical counterinsurgency scholars, such as Douglas Blaufarb, Michael Shafer, William adorn and Benjamin Schwartz, have argued that given the divergent preferences of the U.S. and the local government it is assisting and the relative lack of leverage provided by foreign aid, external assistance will reduce the local government's incentives to address root causes of discontent and encourage counterinsurgency strategies based solely on repression-contravening American counterinsurgency doctrine and preferences. Although this represents an important critique of U.S. counterinsurgency thinking that has been ignored in the contemporary discourse, it is incomplete. This study revises the arguments of these critical scholars about the ability to gain leverage via aid by examining their principal case studies, the Hukbalahap Rebellion in the Philippines (1946-1953), Vietnam during the rule of Ngo Dinh Diem (1955-1963) and the Salvadorian Civil War (1979-1991) in considerably greater detail than the original scholars did-drawing on tens of thousands of pages of primary materials from nineteen different archives in three countries. In doing so, this work makes several unique contributions. First, the book demonstrates that while the warnings of the critical COIN scholars are cogent, they failed to detect the use of varying aid strategies by the United States during the course of its interventions. In fact, the particular choice of aid strategy directly affected the generation of inter-alliance leverage, with inducement-the unilateral provision of incentives and other positive sanctions-and conditionality-the strict tying of specific aid to specific reforms-resulting in significantly different levels of client compliance with the patron's preferred policies. Second, it employs agency theory to examine the patterns of patron-client dynamics during indirect interventions in a theoretically rigorous and structured manner that indicates the key agency problem is about adverse selection, not moral hazard, as some critical scholars have suggested. Finally, the study identifies and corrects several important errors of causality in the case studies employed by the critical counterinsurgency scholars. In addition to expanding the understanding of the role of allies and external support in counterinsurgency, two areas which are under-theorized in the academic literature on the subject, the issues explored in this study have relevance for contemporary policy challenges in Afghanistan and Pakistan.