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Poindexter's DARPA Casino
It's going to take me some time to wade through all the messages I've been
getting about an item on John Poindexter'sDARPA Casino (see "Pssst -- go
long on September truck bombings"). I received a number of thoughtful
messages on the issue, many of them from folks talking up the benefits of
"idea markets." They have been, to a one, quite compelling. But they've
failed to convince me that this brainstorm was a good idea. Yes, markets are
extremely efficient at aggregating information (given a broad, diverse and
informed market). Yes, futures exchanges sometimes predict events better
than other forms of analysis (and are sometimes delusional; take the tech
bubble and bust, for instance). And yes, traders on the Hollywood Stock
Exchange -- another idea market -- last year correctly picked 35 of the 40
Oscar nominees in the eight biggest categories (out of a very small universe
of possibilities with little hidden data). But that doesn't make anonymous
speculation on terrorist strikes a good idea. Especially when there are no
audit trails or other means for flagging terrorists who bet on their own
atrocities. And especially in a nation that still has enough common decency
to be repulsed by the idea of wagering on human suffering.

Onward. Here's another sidelight on the topic.

Hey John,

While the Feds were relentless in their pursuit and prosecution of Jim
Bell for coming up with the idea [assassination politics] and publicizing
it, they apparently have no problem with stealing and implementing it. I
guess it's just another of those things that are ONLY okay if the
government does them (though it seems as if Wolfowitz has "rethought" the issue) ...