The Terrorism Futures Market

[Hanuman]

I get a decidedly "black-ops / Star-Chamber / Trilateral" vibe from this idea, but as hard as I try, I can't think of a good reason to hate it.

http://www.nationalreview.com/comment/comment-lehrer073003.asp

[gristy]

1. You're not thinking hard enough, then.

Very good arguments against this have been published in the past 2 days. You are hereby required to locate those arguments and refute each of them.

[Hanuman]

4. I'm sorry I missed those threads-

and I have no way of finding them now.

[gristy]

Use news google

You definitely should NOT be using DU as your primary news or information source. :)

http://news.google.com/

use keywords

terrorism futures market

[EAMcClure]

16. There was a discussion yesterday in DU

Go to the National security forum. There was a rather lively discussion both pro and con conercning PAM DARPA.

I am on the con side. I think it increases the likelihood of terrorist activities and planning.

Eric

[salin]

2. Lets see

-profiteering on things like: how many US servicemen die...

not quite seemly.

-Then - international perception of US military sponsored betting parlor on assassinations for foreign leaders.

really quite diplomatically sticky. (Imagine a similar "game" based out of, say, Jordon that had people taking bets on the death of our president - the outrage would be - rightly - enormous.)

This program seems based on blind ideology to the perfection of market behavior. We have been witnessing all sorts policies/programs being implemented based not on sound policy but on blind ideology. Problem is, that the application of theory in reality often leads to very distorted outcomes. Just look at the planning and execution of a) the lead up to the Iraq war (didn't get the UN support needed, and now troops are paying for it) and b) the planning (or lack thereof) for post-war iraq. By only working from their "theory" these nutjobs wouldn't allow dissent or criticism (and we saw manifestations of this in some of the public statements of recently retired military, diplomatic core and intelligence officers) - and thus formulated a deeply flawed approach.

In short - it is doubtful that spending 5 million on a program that has a whole lot of problems just in its existence (unseemly, promotion of government sponsored gambling on tragedy, and likely diplomatic fallout) - that is not necessarily likely to provide as good as information as is promised. And if the ideologues stay in power - based on the wacked out behavior they have already exhibited in policy formulation/execution - these nutjobs are likely to use this unproven approach as the reasons for dictating future policy (especially if it is to their liking) rather than solid intelligence.

Maybe seriously reviewing our intelligence apparati and reforming/improving it (which this adminstration has tried desperately not to do) - would be a better approach.

[Hanuman]

3. What if it worked?

It sems that for a measly few million dollars, you might gain a "big picture" insight into what the world is trending toward.

The "moral" arguments about it being unseemly or possibly irritating to other countries doesn't mean much to me simply because of this: Betting on it DOES NOT mean you endorse it.

I can't tell you how many times since 9/11 that I've "calculated" the odds of another attack in another city or my city. I am sure this is true for almost everyone reading this forum. Why not put that massively parallel computing power to work?

What if this idea was transferred to the private sector and conducted from Las Vegas or Atlantiv City- but the results were continually shared with the NSA?

I think it's an interesting thought experiement that COULD yield fruitful results- and for the money which is scant- it seems like it's worth trying.

What are you afraid of?

[Brian Sweat]

6. I have more faith in Madam Cleo

There is no scientific basis on which to speculate that it could possibly work.

[havocmom]

7. sounds like a substitute for going to the casinos?

They may not be welcoming Benett anymore. The rich and bored may need a new forum for gambling habits?

/// Sure, I'll bet $6 million that ###### is gonna get hit then hit; then I hit it and make a bundle. Easy money and I get to play god besides. Whatta rush! /// sarcasm off

It is wrong because it is an invitation to vilence. There is already too much profit in killing without making a sport of it.

[Brian Sweat]

5. I'll take 200 shares of Abu Nidal

[htuttle]

8. What if we just make book on it in Vegas?

How about I put $20 on a US military barracks getting blown up within a month?

What kind of odds will you give me that 6 more US soldiers will get killed by Monday?

I'll bet you $10 that 2 more US troops will die tommorrow.

Does betting in a 'dead pool' sound like something we should be doing OFFICIALLY as a nation?

[Hanuman]

10. You're right- it probably should not be officially sanctioned

But I think running it through Vegas is acceptable.

Look, I find this idea incredibly wierd and even a bit repulsive, too. I am not a gambler, though I do invest in the market thru IRA and mutual funds, but there is a LOOOONG history of the people betting on all kinds of things- even deaths, disasters, political unrest, etc.

I just kind of like this idea for the strangeness of it- and the possibility that it could prove useful. That, and the fact that it could be essentially a free source of info.

[gristy]

12. keep thinking....

there is a LOOOONG history of the people betting on all kinds of things- even deaths, disasters, political unrest, etc.

Examples please? And in your response please note the differences (there will be several) between your examples and what was proposed in this terrorist futures market.

That, and the fact that it could be essentially a free source of info.

Free? Tell that to the low-level politician in East Timor who gets knocked off after someone takes 100 shares out on him.

[htuttle]

15. I wasn't kidding about those bets

I'd make any of the bets I suggested. I think the odds and the bet amounts are about right.

So, what important information did we learn from this exercise? We learned that it's somewhat likely for a barracks to get blown up soon, and even more likely that several more US troops are going to be killed within the next few days.

But, what the heck can we do with that information? We already knew all those things (or we should have, if we were paying attention). Just because we think something is likely doesn't help us stop it. We need a different sort of information to do that.

This idea falls on it's face, like most 'market-oriented' augury methods, because all it does is provide a way to reinforce what is already held as the common wisdom. It does not provide ANY new information.

[ret5hd]

9. what are the odds that rumsfeld, rove, cheney, et al, would do...

the "right" thing if they had a chance to make a few million off of letting a few soldiers or civilians die in a "terror" attack?

[Hanuman]

11. They won't be in office forever...

This idea would outlive any administration.

And ALL politicians and military personell would obviously be outlawed from participation.

I would make the penalty for illegal particiaption very harsh. Life in prison, perhaps.

[Gin]

13. Here is a trade I would bet on...

Poindexters' future!

[ret5hd]

14. and how long has the bush family been involved in the cia?

"inside" information is not limited to those in any administration.
and the "penalties", whatever they would be under whatever circumstances, would just be further incentive to keep your dealings secret and/or thru 3rd parties. public knowledge of an official's profiting from the preventable death would essentially be a death penalty anyway.

methinks maybe you are just playing devils advocate here. if so, fine. (hell, if not, fine. everyone has their opinion). but really, does anyone think this morbid bit of bloodsucking is a GOOD idea?

[Hanuman]

17. All right- I am not exactly playing Devil's Advocate here-

mostly just thinking out loud, so to speak.

And you all have raised good objections.

This is a purely academic procedure here, since this idea has less than microscopic chance of ever getting off the ground.

That said, I still admire the wierd, crazy, Machiavellian genius of it. Poindexter never fails to "think outside the box."

I'll take my beating now and retreat!

[gristy]

18. ok then, get thee to a nunnery

You have refused to back your position with logic or facts. You've got some balls to continue to post, simply restating your position.

[Hanuman]

19. And you delight in breaking them!

I wasn't trying to make an eloquent and principalled stand on this issue- just sounding it out here, Gristy, my friend, my pal.

Didn't know you needed brass ones to check the temperature on an idea.

[nothingshocksmeanymore]

20. Here's a good reason to hate it by a Nobel prize winning economist

Almost 30 years ago, Sanford Grossman and I investigated theoretically the validity of these claims. We focused on competitive markets in which we assumed participants had some relevant information. For instance, a farmer knows something about his own crop, so if he participates in a futures market he will bring his knowledge to bear on that market. Voters who participate in a futures market also bring relevant information — whom they and their friends are voting for — and that is why futures markets may predict presidential elections reasonably well.

But there are severe limitations in the ability of markets to provide accurate predictions; for instance, where markets have few participants and can be easily manipulated, or where there are large asymmetries of information, with some participants (the few large international chocolate producers, for example, in the cocoa futures market) having far more information than others.

Futures markets provide insurance as well as information: They enable a farmer/trader to reduce the risks he faces resulting from the fluctuations in commodity prices. But by providing "insurance" for participants, futures markets can also create the long-noted "moral hazard" problem — the notion that insurance can alter incentives. Someone who has insured his house for 110% of its value has an incentive to set it afire.

and of Poindexter:

Did he believe that the 1,000 people "selected" for the new futures program would have this information? If so, shouldn't these people be investigated rather than rewarded?

http://www.latimes.com/news/opinion/commentary/la-oe-stiglitz31jul31,1,4162448.story?coll=la-news-comment-opinions