When the creation of a new caliphate was announced last year, who but the small band of his followers took seriously its leader’s prediction of imminent regional and eventual global dominance? It straddled the northern parts of Syria and Iraq, two countries already torn apart by civil war and sectarian hatreds. So the self-declared caliph, Abu Bakr al-Baghdadi, appeared to be just another thug and opportunist ruling over a blighted no-man’s land, little known and still less revered in the wider Islamic world. He was surrounded by a rag-tag army of jihadis, whose imperial hubris seemed to reflect only a warped genocidal fanaticism. Surely they were far too otherworldly, with their obsession over the life lived by their prophet and his companions more than 1,400 years ago, to have much of an impact on the world in which we scuttle off to work each morning?

Two years on, even the most hardened sceptic is having second thoughts. The apparent bombing of a Russian airliner last week, minutes after taking off from the Egyptian resort of Sharm el-Sheikh, was proof of the caliphate’s potential to wreak havoc on a global scale. It left hundreds of thousands of Britons, Russians and others stranded and distraught, or hastily cancelling their holidays. Here was more evidence, too, that Islamic State’s strategy of recruiting the Muslim masses by impoverishing them, while damning all among them who do not shun or kill infidels, is likely to be far more consequential than al-Qaeda’s spectacular attacks against prominent western targets. Egypt, after all, had been the only Arab country (apart from Iran-controlled Iraq) to openly support Russian airstrikes in Syria, and just a few weeks after making that fateful decision its most important resort is deserted. Others, such as Luxor and Aswan on the Nile, have been ghost towns since the 2011 uprising that toppled Hosni Mubarak.

Egypt was, in other words, just as much a target as Russia. The country’s tourism-dependent economy has been decimated, as has Tunisia’s following the slaughter of mostly British tourists there in June by another Isis-inspired terrorist. Both may take years to recover, and the fallout in the meantime will be a great boon for jihadist recruiters. This is part and parcel of the caliph’s strategy of bringing order out of chaos. For with such an overwhelming sense of hopelessness and helplessness, even cripplingly rigid tyranny starts looking like a preferable alternative. We have seen this play out repeatedly throughout the Sunni-majority areas of Iraq and Syria under the caliphate’s control, and in Taleban-dominated parts of Afghanistan.

The caliph must be rubbing his hands in glee. For the first time in modern history, large parts of the Arab world are now effectively off limits to Westerners — even if Isis was just jumping on the bandwagon of an accident. Meanwhile, millions of refugees and economic migrants, most of them Arab Muslims, continue to flood into Europe. Among them, if the caliphate’s propaganda is to be believed (and there is no reason to doubt it), are many who are determined to repay the kindness of strangers by blowing themselves and innocents to smithereens in the name of their beloved leader. This horrid little fascist, unrecognised as an authority on anything by anyone but himself until a few months ago, is turning the world on its head.

Taking stock of a new reality is what Vladimir Putin, the caliph’s main adversary, is also busy doing. Bedevilled by a growing jihadist threat at home and with the grim knowledge that some 8,000 Russian jihadis are believed to be fighting for the caliph with the dream of one day taking their fight to the homeland, Putin had sold the war in Syria as a way of making ordinary Russians safer. His popularity soared; but now a planeload of Russian holidaymakers are dead. More than a month into an aerial campaign officially slated to last just three or four, the Syrian army has managed to recapture only a few villages. And Isis fighters, according to some estimates numbering in the hundreds of thousands, are still emerging from fortified bunkers to carry out counterattacks in the most strategically crucial part of Syria. Russia can fire all the cruise missiles it likes, but without greater international co-ordination the caliphate clearly is not going anywhere soon.

However, with appalling cynicism Washington is happy, for the time being, to watch Putin sink deeper into the Syrian quagmire, flirting with the idea of a peace deal between the warring factions while its ally Saudi Arabia ratchets up arms supplies to those who are preposterously called ‘moderate’ rebels. Many critics of the West’s role in Syria point to Libya as an example of the potential perils of such forced and ill-thought-out regime change. To be sure, that is a relevant point; but a more accurate analogy can be drawn with Afghanistan. There, too, Washington and its Saudi ally, via Pakistan, armed and funded the mujahideen to fight the Russians, who withdrew from that cursed country in humiliating defeat. Those jihadis also told their paymasters everything they wanted to hear about being freedom fighters and pro-western, then morphed into the Taleban.

Putin is not a leader to show weakness under pressure, and Russia is not the Soviet Union. His initial response to the terror attack will be to increase airstrikes, while using the state-controlled media to drum up yet more mindless patriot fervour among the masses. But with consistently low oil prices, Russia’s economy is rapidly hurtling towards insolvency; and the longer the war drags on the more likely the prospect that terror attacks at home, in addition to inevitable civilian casualties in Syria, will undermine support for his self-declared crusade. This, sadly, is what Washington is hoping for, and its own endgame is much easier to discern: to get Putin to ditch President Bashar al-Assad so that everyone can save face in a war that has reached stalemate. Putin may be ruthlessly authoritarian, but he is also a master political pragmatist, and within hours of the terror attack he let a Kremlin minion state publicly, for the first time, that Russia did not consider Assad to be unexpendable.

But how can we have faith in our political leaders to deal intelligently and rationally with the threat posed by the caliphate, even after a political deal is reached in a post-Assad Syria, if they cannot even bumble through a stage-managed press conference without making fools of themselves? The Sharm attack came just hours before Egyptian President Abdul Fattah el-Sisi, scourge of the Islamists, came to the UK for a private meeting with David Cameron. They were to discuss, of all subjects, the fight against terrorism. Britain is Egypt’s biggest foreign investor, and Egypt (almost needless to say) is a massive purchaser of British arms; the red-carpet welcome was actually in no small part to thank Sisi for a £8 billion gas deal granted earlier this year to BP.

Considered remarkably generous in BP’s favour by energy experts, the deal was brokered, it is widely suspected, as part of a lobbying effort by Egypt (in conjunction with the UAE) to get the Muslim Brotherhood outlawed in Britain. But the facade of a war-on-terror alliance quickly came tumbling down — another feather in the caliph’s turban — when it emerged that this tinpot dictator was, in reality, considered to be so lacking in integrity by the British government that it refused to share intelligence gathered on the possible cause of the Russian plane crash with him, despite the fact that he was sitting in Downing Street and the aircraft had fallen out of the sky in Egyptian airspace.

Thus Sisi’s bid to be taken seriously on the world stage in the end only left him looking like the buffoon he is. Unbridled corruption, nepotism and cronyism were so rampant in his country, it turned out, that security at Sharm’s airport was practically nonexistent. A former Egyptian head of the country’s airport security summed up the absurdity when he revealed that even at Cairo’s things are such a monumental mess that staff once left a donkey to wander around inside it for days.

In this way, just months after it was leaked that Britain had helped Saudi Arabia secure a seat on an important UN human rights panel, Britain’s backdoor wheeling, dealing and horsetrading with yet another unsavoury Arab dictator was exposed. Under the guise of presenting Sisi as a steadfast supporter of the fight against radical Islam, Britain conveniently overlooked the fact that the Egyptian leader came to power by massacring more than a thousand peaceful demonstrators, and that he presides over a country so hopelessly mired in corruption that a security guard at an Egyptian airport may even have let a terrorist pass through unchecked because, like our government, he was slipped a few quid.

The caliphate hopes the Cold War mentality in Washington and the insatiable desire to feed at the trough of Arab despots there and everywhere else will undermine any effort to destroy it, even if a new international coalition of the willing is eventually created. The caliph and his successors are in this for the long haul, and a close reading of their propaganda reveals a truly apocalyptic scenario. Their strategy depends principally on an uprising in Saudi Arabia, which would plunge the global economy into a catastrophic depression. Jordan, a Saudi client state where Islamists are the only serious opposition and where the King is considered a laughing stock, would immediately fall, leaving the soldiers of the caliph free to focus on their most anticipated battle for the ‘liberation’ of Jerusalem. It sounds fanciful and far-fetched, to the point of being ridiculous. But so did everything the caliph was saying two years ago about what we are quickly resigning ourselves to calling a terrifying new world order.