Betting on Terror

Martin Kelley — Tue, 29 Jul 2003 09:41:17 +0000

The news sites are all reporting a Pentagon plan to bet on future terrorist activity (BBC). It’s reported as a stock market-style system in which sucessful predictions by investors would win them money.
Someone at the Pentagon has read a little too many books about the infinite wisdom of the free market. There are those who have a religious faith in the power of unfettered capitalism, who posit it as a kind of all-knowing, self-correcting God. With the input of enough self-interested actors, the truth can be discerned. I’d argue that stock markets are more like blogs (the highly-linked New York Times version of the article), with everyone rushing to make the same links (Associated Press).
The truth of the matter is that recent intelligence lapses have been the result of political meddling in the collection and analytical processes. When the boss wants a certain result (proof of weapons in Iraq, proof of Al Qaeda links), then the group-think pressure to conform will warp the sifting process. A stock market-style system for predicting terror would be about as accurate as a poll of CNN and Fox News watchers–it will tell you what everyone thinks but it probably won’t tell you the truth.