Posted on 07/29/2003 5:52:11 PM PDT by MegaSilver
WASHINGTON - The Pentagon (news - web sites) is setting up a stock-market style system in which investors would bet on terror attacks, assassinations and other events in the Middle East. Defense officials hope to gain intelligence and useful predictions while investors who guessed right would win profits.
Two Democratic senators demanded Monday the project be stopped before investors begin registering this week. "The idea of a federal betting parlor on atrocities and terrorism is ridiculous and it's grotesque," Sen. Ron Wyden (news, bio, voting record), D-Ore., said.
The Pentagon office overseeing the program, called the Policy Analysis Market, said it was part of a research effort "to investigate the broadest possible set of new ways to prevent terrorist attacks." It said there would be a re-evaluation before more money was committed.
The market would work this way. Investors would buy and sell futures contracts — essentially a series of predictions about what they believe might happen in the Mideast. Holders of a futures contract that came true would collect the proceeds of investors who put money into the market but predicted wrong.
A graphic on the market's Web page showed hypothetical futures contracts in which investors could trade on the likelihood that Palestinian leader Yasser Arafat (news - web sites) would be assassinated or Jordanian King Abdullah II would be overthrown.
Although the Web site described the Policy Analysis Market as "a market in the future of the Middle East," the graphic also included the possibility of a North Korea (news - web sites) missile attack.
That graphic was apparently removed from the Web site hours after the news conference in which Wyden and fellow Democratic Sen. Byron Dorgan (news, bio, voting record) of North Dakota criticizing the market.
Dorgan described it as useless, offensive and "unbelievably stupid."
"Can you imagine if another country set up a betting parlor so that people could go in ... and bet on the assassination of an American political figure, or the overthrow of this institution or that institution?" he said.
According to its Web site, the Policy Analysis Market would be a joint program of the Pentagon's Defense Advanced Research Projects Agency, known as DARPA, and two private companies: Net Exchange, a market technologies company, and the Economist Intelligence Unit, the business information arm of the publisher of The Economist magazine.
DARPA has received strong criticism from Congress for its Terrorism Information Awareness program, a computerized surveillance program that has raised privacy concerns. Wyden said the Policy Analysis Market is under retired Adm. John Poindexter, the head of the Terrorism Information Awareness program and, in the 1980s, a key figure in the Iran-Contra scandal.
In its statement Monday, DARPA said that markets offer efficient, effective and timely methods for collecting "dispersed and even hidden information. Futures markets have proven themselves to be good at predicting such things as elections results; they are often better than expert opinions."
The description of the market on its Web site makes it appear similar to a computer-based commodities market. Contracts would be available based on economic health, civil stability, military disposition and U.S. economic and military involvement in Egypt, Iran, Iraq (news - web sites), Israel, Jordan, Saudi Arabia, Syria and Turkey.
Contracts would also be available on "global economic and conflict indicators" and specific events, for example U.S. recognition of a Palestinian state.
Traders who believe an event will occur can buy a futures contract. Those who believe the event is unlikely can try to sell a contract. The Web site does not address how much money investors would be likely to put into the market but says analysts would be motivated by the "prospect of profit and at pain of loss" to make accurate predictions.
Registration would begin Friday with trading beginning Oct. 1. The market would initially be limited to 1,000 traders, increasing to at least 10,000 by Jan. 1.
The Web site says government agencies will not be allowed to participate and will not have access to the identities or funds of traders.
The market is a project of a DARPA division called FutureMAP, or "Futures Markets Applied to Prediction." FutureMAP is trying to develop programs that would allow the Defense Department to use market forces to predict future events, according to its Web site.
"The rapid reaction of markets to knowledge held by only a few participants may provide an early warning system to avoid surprise," it said.
It said the markets must offer "compensation that is ethically and legally satisfactory to all sectors involved, while remaining attractive enough to ensure full and continuous participation of individual parties."
Dorgan and Wyden released a letter to Poindexter calling for an immediate end to the program. They noted a May 20 report to lawmakers that cited the possibility of using market forces to predict whether terrorists would attack Israel with biological weapons.
"Surely such a threat should be met with intelligence gathering of the highest quality — not by putting the question to individuals betting on an Internet Web site," they said.
Wyden said $600,000 has been spent on the program so far and the Pentagon plans to spend an additional $149,000 this year. The Pentagon has requested $3 million for the program for next year and $5 million for the following year.
Wyden said the Senate version of next year's defense spending bill would cut off money for the program, but the House version would fund it. The two versions will have to be reconciled.
___
On the Net:
Policy Analysis Market: www.policyanalysismarket.org
DARPA's FutureMap Web site:
http://www.darpa.mil/iao/FutureMap.htm
On the other hand, what could it hurt? If sick rich people want to give their money to our nation's war effort, I say let 'em. Interestingly enough, the Democrats would advocate raising taxes and not going to war before they would advocate something like this. (Of course, to do otherwise would mean to be on the same side as the United States.)
I am amazed how antiquated the Democrat Party has become. They truly are "the last of the Victorians", stuck in a time warp of their own making. Each week there is one more indication that the Demos are not fit govern, and this is one of them. They are morons, each and every one of them.
This is a valid technique and it has been used in the past (to locate lost H-Bombs & a sunken nuke sub). It works. The problem, if there is one, is that it just shouldn't have been publicized. Keep it like an office betting pool -- the Democrats could understand that!
I don't think you are wrong. For negative reassirance look at replies at FR. Look at what people claiming to be conservative say and defend.
Unfortunately society would like to see the opposite, decent, upstanding conservatives be the gladiators.
Not "society," but Democrats. You must remember that many Democrats simply hate Republicans and will never see anything good about anything we do. Ever.
Democrats believe that we are malevolent, murderous scum. The reality of the situation? Ann Coulter probably put it best in Treason.
This scheme is completely insane. In every market there are market makers who attempt to manipulate the market, at least for the short term for their own gain - not the least of which appears to be our own Federal Reserve. So, say someone starts dumping POTUS futures. Is this a tip that something is going down, or is it just Greenspan trying to keep the dollar from overheating?
But why is the Pentagon runiing it rather than the private sector.
I think all of these Clinton holdovers need to be cleaned out of the government bureaucracy. They keep coming up with some of these schemes to embarass Bush. (Admiral Poindexter ought to retire and spend his declining years navel-not naval gazing.)
You know what's funny? A while ago, I heard a Democrat who voted for Gore yell at some of his fellow liberals for everything that Bush was doing to "ruin" our country. He pointed out that there are quite a few people responsible for some of the negative things that have come up recently, and that Bush is just the figurehead. Wow. A Democrat said that? I wonder if he was just bluffing about his political affiliation...
Anyway, he said this before he told anyone that he was a Democrat, and instantly a couple of people (whom I know to be complete buttholes when it comes to politics, to put it lightly: both of them argue almost exclusively with political attacks and their conflicts-of-interest are rather obvious with every statement they make, not to mention that I suspect them to be secretly communist; nothing could possibly be leftist enough for them) instantly jumped on him. "My guess is you are a rich Republican" and "Oh, YEAH? You like Bush? Well, let me tell you just what your hero did to our country!" And that's when he said, "For the record, I am neither rich nor Republican, and I voted for Gore." (This is why I wonder whether he's really a Democrat; besides, are any of them even close to THIS reasonable? I've known maybe one or two in my lifetime.)
But, yeah. Point is, Ann Coulter was right. Many Democrats simply hate Republicans.
Nice argument. Speaking of Romans, I believe they would call this pattern, "Cum hoc, ergo propter hoc." Anglo-Saxons like myself call it, "With this, therefore because of this."
Let's see just how far that argument gets us, shall we? Okay. I'd love to.
We can apply it to democracy. Democracy was the system of government used by the Athenians, and we all know what happened to them--Sparta beat them up. (Actually, Sparta nailed them because they had a stronger army; Athens knew about this, yet they neglected to prepare.)
We can apply it to legislative representation. The government of ancient Rome was a republic, and we all know what happened to them--they became an empire and fell to the barbarians. (Actually, their fall was due to political sloppiness and division. As always, divide and conquer.)
So, as we can see, such arguments are hardly convincing. In fact, they don't really work at all, hence the term, "logical fallacy."
Now, the government of the U.S.S.R. was communist and we know how that turned out. Only, in this case, communism CAN be pointed to as one of the primary culprits for their eventual collapse. Communism made the people bitter, fearful, and unmotivated, which pushed the nation behind. And when someone tried to improve it, it simply fell apart.
I'd love it if child molestors and murder convicts were forced to be gladiators. The money could go to the victims/families. But what would really be fun is if champions could be designated [and tested for qualification] to beat the living snot out of them, say an outraged father for example, so long as he's fit enough for the event.
I hope you realize that defies the principle, "Innocent until proven guilty."
Unfortunately it was not just the Democrats clutching at their medicine bags. As soon as the Dems squealed in terror, there were plenty GOPers grabbing for any microphone they could get their hands on to shake it at the evil bad-publicity spirits. The council wigwam was full of witchdoctors from both parties denouncing the bad medicine. I'm surprised they appeared in front of cameras for fear that what's left of their souls would be stolen.
I'll not comment on the palletability of the technique. It is a legitimate intelligence method. I seriously doubt if any one of the scoundrels from either party understands the inner workings of their cell phones either. But you can be sure they wouldn't let their ignorance of electronics keep them from using it to call their mistress if the itch struck them.
God help us. The safety of the nation is in the hands of Luddites.
I had no idea we had so many intelligence analysts here at Free Republic. Thank goodness you're here to step into the vacancy.
All of you who are so quick to condem this, please tell me what your real disagreement with the technique is. Do you disagree with the mathematics behind the theory or is it that you just think it "looks bad"?
If it's the former, please elucidate. If the latter, please restrain your Carterian impluses to hamstring the intelligence community because you don't have the stomach for it. There is a war on and too many of my neighbors are in harms way for you to be dabbling in political cover-spins.
I just watched a program on avalanches on the History channel. In our area, it's channel 43. Best not to be anywhere near them.
Back to the classics for you! That was Greece, not the Roman Empire.
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