July 30, 2003
ALL BETS ARE OFF
As long as there's terrorism, people might as well profit from it, right? And if the federal government orchestrates some friendly wagers on the next terrorist strike, who could argue with that, right? A U.S. Pentagon office that strove to be the Big Brother you never thought you had has been setting up a futures-trading scheme based on the likelihood of future terrorist attacks, particularly in the Middle East. The so-called Policy Analysis Market (PAM) would let investors exploit "a market in the future of the Middle East." The PAM Web site (which has been taken down) explained how this might work:
Suppose that an expert on Jordanian affairs believes King Abdullah will be overthrown. She buys a "futures contract" on the belief that the king will be assassinated; she holds a minority opinion, so the price of her investment is low ó 35 cents per share. As more people follow her example, the price of the deposed-king future goes up, say, to 50 cents. The early investor sits tight, and if someone slams a bullet through the king's skull, "then she can make a handsome profit."
Those who feel unsure about Jordanian prognostication could bet on other acts of terror: the potential assassination of Palestinian leader Yasser Arafat or the likelihood that North Korea will shoot nukes at someone.
News of this morbid means of money-making, which hit the papers Tuesday, outraged Democrats (and, later, Republicans) in Congress. They said the whole proposition was morally repugnant and grotesque.
Within hours of the first front-page headlines, PAM suffered its own untimely demise. (And we didn't even get a chance to bet on its fate.) In a terse statement, DARPA said it made no sense "to continue our participation in this effort."
At the same time, the office reiterated its rationale for the you-bet-a-life scheme. "Futures markets have proven themselves to be good at predicting such things as elections results; they are often better than expert opinions. The program was part of DARPA's overall thrust to find new ways to avert terrorism."
By early Tuesday afternoon, the PAM Web site (www.policyanalysismarket.org) disappeared from public view. And in Congress, Deputy Defense Secretary Paul D. Wolfowitz confirmed that the program would be dropped. He said, "I share your shock at this kind of program."
Sure. Wolfowitz would have more credibility if DARPA had no history of launching offensive initiatives.
The Policy Analysis Market was the brainchild of the now-controversial Defense Advanced Research Projects Agency. Late last year, the public learned that the research office was launching a program called Total Information Awareness (TIA). TIA was envisioned as a massive data-mining project that would gather and analyze mountains of citizens' personal information. Never mind the trifle known as the Fourth Amendment. Some politicians denounced the massively unwarranted invasion of privacy, and they strove to outlaw TIA surveillance on citizens. Since then, the program has been renamed "Terrorism" Information Awareness.
The man behind all of this is John Poindexter, who runs DARPA but is better known as a rogue agent in the Reagan administration's Iran-Contra scandal. Poindexter was convicted of charges of lying to Congress about selling weapons to Iran and funneling the proceeds to insurgents in Nicaragua. His conviction was overturned because he'd been granted immunity for his deceitful testimony. (Copyright 2003 - Boulder Daily Camera)
Posted by Mikal at July 30, 2003 6:54 AM
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