Monday, August 04, 2003

Defending terrorism futures. Last Friday, during my weekly appearance to discuss media issues on WRKO Radio (AM 680), talk-show host Pat Whitley said he was going to take a controversial stance: in the 10 a.m. hour, he would come out in favor of John Poindexter's idea to create an Internet-based futures market aimed at predicting acts of terrorism.

Well, Whitley's attempt to make waves got overwhelmed pretty quickly. To an extent one couldn't have imagined, what seemed like a bona fide terrible idea when it was first reported last week was quickly embraced by media pundits seeking to be counterintuitive.

Here are the examples I saw -- and I'm sure I missed a few:

  • Beating Whitley to the punch, New Yorker financial columnist James Surowiecki wrote a piece for his alma mater, Slate, on July 30 in which he argued, "If the price of getting better intelligence is having our sensibilities bruised, we should be willing to pay it."
  • On Sunday, the New York Times' Floyd Norris suggested that the idea was a useful one, and explained why the US government had to get involved in order for it to work: "The answer is that Uncle Sam had been picked to play the role of designated loser in the gambling." In other words, if the terrorism-futures market were private (and there already is one), it wouldn't be as useful, since there would be some bets that no one would take.
  • Also on Sunday, the Boston Globe's Gareth Cook (ex of the Phoenix) reported that the market idea was just one of a number of creepy and potentially vital projects being undertaken by the Defense Advanced Research Projects Agency, the office that Poindexter will continue to head for at least a few more weeks.
  • McGill University lecturer Reuven Brenner, in an op-ed piece for the Wall Street Journal last Friday that was posted to the free site on Sunday, writes in defense of the market idea -- but, in true WSJ fashion, argues that there is "no reason" for government involvement.
  • This morning, the Globe's Hiawatha Bray offers a defense. Unfortunately for him, he writes that "there's nothing to stop some businessperson from launching a similar project," showing that he didn't read Norris's Times piece. Or maybe he read Brenner's piece instead.
  • Also today, the Boston Herald's Ted Bunker, his weekly "Capital Focus" column, interviews former DARPA scientist Vincent Cerf, who complains that the political pressure being exerted today might have hampered the development of the Internet, an earlier DARPA innovation.

So, was the Policy Analysis Market, as the terrorism-futures lottery was formally known, a good idea? Damned if I know. I remain deeply suspicious for two reasons: the involvement of Iran-Contra figure Poindexter, and the notion that futures markets are far better at predicting mass behavior -- say, a presidential election, or changes in soybean prices -- than they are at predicting the behavior of a few mayhem-minded individuals.

But this much is certain: what had seemed like a deeply controversial idea when it was first revealed may not actually be very controversial at all.

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