Um, I saw this on CNN, and don’t quite know what to make of this project.
It seems that the Dept. of Defense spent a few dollars getting this futures market off the ground. What kind of futures? Terrorism futures. According to the DoD, markets similar to this can predict future events with uncanny results. One can put or sell futures on assassinations, coup d’etats, etc.
This kinda bothers me:
On the one hand, I abhor the idea of placing money/wagers/contracts on people’s lives in something like this. There was another Pit thread where I jumped on someone for placing bets on how many would die in OP Iraqi Freedom. Something like this just seems. . . wrong.
On the other hand, this may be a useful tool, allowing insiders to use their knowledge to plan and predict future terrorist actions. If the DoD can monitor trading activity and get some ideas on potential terrorist plots, is it worth it? Is the trading of mere contracts worth the lives this market may save?
I don’t know. . . I guess it’s just a novel idea that may work, but it makes my skin crawl at the same time. But then again, nuclear deterrence is the same way–a necessary evil. . .
This was tried before and was shouted down as trafficking in human misery.
The idea is sound. People with money at stake tend to make sound investments, so I’d have a very hard time thinking of a better leading indicator of a terrorist act.
It’s kinda callous, though, when you think about it. It’s betting on someone’s death. Although there are dead pools around, including a few right here at the SDMB, so it’s not unheard of.
masonite, Amn Doors, I thank you guys for the links and the thoughts. . .
I know there are “celebrity death pools” and things like that, but to me, those aren’t based off the inherent intent on murdering people. No, I am not condoning them, but, when there’s a dollar on the intentional pulling of a trigger, I just can’t see that as right. . .
But, what if the DoD has found a way to capitalize off of people with inherent knowledge? What if ‘insider trading’ takes a whole new path and leads us to new arrests and convictions? Sure, we’re potentially trafficking in human misery, but wouldn’t that be worth a handful of lives we’ve saved?
Man, talk about dilemmas. . .
Tripler
To me it’s a practical moral wrong, with no right answer. . .
Here are a number of arguments I see against this idea:
If the ultimate goal of this government is to stop crimes that are committed, not to make money. Yet the ultimate goal of the traders is to make money. These two ideas clash. When a future becomes so popular that governments try to stop it from happening, it interferes with the market itself.
Those that know when a terrorist attack is likely will be targetted. Publicly traded companies produce public information which is how stockbrokers determine whether to buy or sell a stock. Terrorists don’t do that. So anyone with information, too much information, becomes a) a target of authorities who want to know why this person is so well informed, or b) a target of the terrorists as a way to plug up a leak. Either way, those who become too successful at this little game are going to be silenced, which ultimately defeats its purpose.
You think insider trading is bad now? Wait until a terrorist group funds its future projects by betting on things they KNOW are going to happen because they’re the ones doing it. Worse, wait until they manipulate the market by making other futures more popular and thus throwing authorities off the trails of the crimes really slated to be committed.
Ultimately, it could lead to such futures as “More than 27 people dying on date X” or “27 or less people dying on date X” which has little to do with hard core information and more to do with the over/under of the event in question. How useful is that?
Well, I for one know exaclty how I feel about this. It’s a clear example of a brilliant idea that failed to materialize simply because it’s hard to explain to your average voter why it’s OK to do something the average voter thinks is “profiting from human misery.”
A bunch of economists on a listserv I read were very upset (but not all that surprised) when the DoD decided not to do it.
If your interested in how it could be run, check out www.tradesports.com. Also, there’s another exchange run by a school (can’t remember where it is now) that has very accurately predicted political and social events.
I think I’d be concerned about terrorist “fundraising organizations” buying up futures, then indicating to Al Qaeda or their ilk that it’s time to initiate Step 2.
TaxGuy, futures shares have their use. I remember when one of the lecturers from the Institute of Humane Studies (the libertarian organization) mentioned to me that an early version of the futures, in Iowa, I believe, has “predicted” every election since WWII. The big difference here, though, is that, whereas a handful of investors are unable to directly influence the outcome of an election, or of a “social event” (good thing Vegas doesn’t run that one, you’d never cash out), a handful of inclined people can influence the outcome of the terror shares. Why just blow up people, when you can blow up people and make some money?
Ender, I see your point already in #1. However, as I was reading it I was struck, “Hey, isn’t it ironic how the very system they wanted to destroy with 9/11 seems to directly predicting their moves?” (capitalism, that is).
I know for a fact that there are membership standards to being on the floor of the NYSE, and I can only imagine there are standards (which the DoD will monitor) that you must submit to in order to trading on this market (i.e. a thorough background search to prevent what Duke outlined). The ‘selling point’ of this market is that locals and insiders to certain industries can read the markets and make predictions. To wit, the DoD can read the “motions of the market” and generate new ideas and ways on combatting terrorism.
However, it’s banking on direct lives, and that causes me problems when someone places a dollar on a life. I’m not really concerned that terrorist groups will infiltrate this market, being that “Big Brother” is watching every move and step. But something that just popped into my head is this: Hey, Tripler you’re getting deployed to ‘Unrecognizablestan’ because we think there’s a big al-Qaeda group there. Go build a runway to bomb 'em!". Next thing you know, 150 troops are dead because someone either read wrong into the market, or terrorists figured out a way to “put ripples in the pond” to have the DoD kneejerk a somewhat predictable reaction.
So, while I was relatively upbeat while starting this response, now I’m back to square one. . . We’re betting dollars on lives here, but based on what TaxGuy mentions, these sort of systems seem to produce fairly accurate results.
Tripler
:: scratches his head in a personal moral dilemma ::