FutureMAP

FutureMAP is the short name for a little program formally known as the Futures Markets Applied to Prediction. It was an idea brought to us by our fine friends in the Department of Defense known as DARPA. Basically it was to be a terrorism futures market. It would have enabled investors to profit or lose from certain little events such as terrorist attacks, the overthrow of particular governments, assassinations, nuclear threats and other assorted goodies that are likely to occur in some of the world's more unstable regions.

If you’re like me and don’t dabble in the futures market and futures contracts here’s a brief overview as it pertains to commodities .

A futures contract is an obligation to buy or sell a specific quantity and quality of a commodity at the futures market price on a specified future date.

Just for shits and grins, let’s say you were willing to bet that Saddam Hussein was going to be killed within the next three months. If I read my definition correctly, you would act as the “seller” in this “transaction.” The person willing to take your bet would act as the “buyer”. You could lock in your price and await the result. Sound too far-fetched? Guess again. The Pentagon wanted to sponsor a website that would initially allow up to 1,000 “investors” to do just that. Does anybody want to speculate about who those “investors” might have been and what kind of insider information they might have been privy to?

Here’s what DARPA had to say about the project…

The DARPA FutureMAP (Futures Markets Applied to Prediction) program is a follow-up to a current DARPA SBIR, Electronic Market-Based Decision Support (SB012-012). FutureMAP will concentrate on market-based techniques for avoiding surprise and predicting future events. Strategic decisions depend upon the accurate assessment of the likelihood of future events. This analysis often requires independent contributions by experts in a wide variety of fields, with the resulting difficulty of combining the various opinions into one assessment. Market-based techniques provide a tool for producing these assessments.

There is potential for application of market-based methods to analyses of interest to the DoD. These may include analysis of political stability in regions of the world, prediction of the timing and impact on national security of emerging technologies, analysis of the outcomes of advanced technology programs, or other future events of interest to the DoD. In addition, the rapid reaction of markets to knowledge held by only a few participants may provide an early warning system to avoid surprise.

After the text there is a picture of what appears to be a dart board or target with three or four darts stuck in it. There’s also a graph that displays along the “x” axis the words “Probability of Terrorist Activity %”. Along the ‘Y” axis, one could presumably bet on the “Probability of Overt Action %.

Fortunately, the program was cancelled after it came under fire from leading Senators from both parties. Here are a few excerpts that echo my sentiments on the whole matter.

''For the life of me, I cannot believe that anybody would seriously propose that we would trade in death - 'the most irresponsible, outrageous, and poorly thought out of anything I've heard from the administration.'' - Senator Tom Daschle of South Dakota

''I was appalled that we would be in a sense setting up a futures market in death and destruction, and it is not in keeping with our values,'' - Senator Hillary Rodham Clinton of New York

Even Paul Wolfowitz, the Deputy Secretary of Defense got into the act when he said…

'We'll find out exactly how this happened, recognizing by the way that the agency that does it is brilliantly imaginative in places where we want them to be imaginative., It sounds like maybe they got too imaginative in this area.''

By the way, DARPA is/was headed up by John Poindexter, the same guy who was convicted of lying in the Iran-Contra fiasco and who, after having his conviction overturned, brought us Total Information Awareness which was subsequently re-named Terrorist Information Awareness after much public outcry.

Does anybody else out there find it as appalling as I do that the government was even considering such a program?

Source

www.darpa.mil/iao/FutureMap.htm

Update...On July 31, 2003, the DoD announced that Mr. Evil was resigning as a result of the furor caused by FutureMAP. In this writers opinion, at least it served one purpose.

DARPA proposed to allow experts to put their money where their mouths are on issues of terrorism by creating a "market" - which is a euphemism for a gambling game - in which an expert with a very strong belief that some event will or will not occur is able to quantify the strength of that belief in a way that profits him or her if it turns out to be correct.

I have heard no one defend the idea, and I think this is because it is clear that some players of the game would profit from the suffering of others. The people that came up with the idea were trying to solve one of the biggest problems in the intelligence game: there is no mechanism to coalesce all the valuable little bits of information that these experts have. Imagine a gigantic meeting of these experts, all trying to contribute their assessment as to the amount of resources that should be spent in the various areas of defense and security. Ideally, there would be a list of possible candidate areas and they would each be given a score which reflected the opinions of the experts. "Vote with your pocketbook" leads directly from this ideal description to FutureMAP.

It seems to me that the current and widespread disparagement of the program is an episode of killing the messenger. Essentially, we have a group of players who will profit from, say, a dirty bomb being detonated before the end of the year. Immediately, instinctively, we hate these people. The problem is that we are not discriminating between those who are causing the terrorism and those who are paying attention. I personally have no problem paying those experts who turn out to be right about something bad if they are willing to share their opinions in a way that makes it easy to coalesce them with the opinions of others and thus give us a chance to be better prepared.

If the gambling game is too distasteful, let us try to find some other mechanism of coalescing the opinions of experts in a way that encourages the experts to quantify the strength of their opinions. Perhaps one of the cooperative websites would be a good start.

Excalibre points out that the opinions that would be coalesced may reflect the moods of the rich more than the real situation the game was designed to illuminate. I do know that it was to be restricted to experts, but there's no information on how those experts were chosen. This once again leads us in the direction of an opinion coalescing system such as E2 or E-ThePeople, where the amount of money you have to play with is not a factor in the weight of your opinions.

A controversial new trend in futures markets is the buying and selling of so-called "terrorism futures". These are contracts stating that a particular act of terrorism (for example, that a particular embassy in Tel Aviv will be bombed before June, 2004) will occur. If you hold such a future and others believe this will occur, they will try to buy and/or create similar futures, driving up the market price of your future.

The origin of this seems to have been the PAM project, funded by DARPA, originally conceived by John Poindexter, a national security adviser from the Reagan regime. PAM ran such a market, for events in the Middle East. Why would the US DoD be selling futures like this? Quite simply because time and time again, the predictions of futures markets have been much more accurate than the predictions of any group of experts.

The buying and selling of futures for events isn't just limited to terrorism - a group called the Hollywood Stock Exchange has been doing the same with the success of new movies since December 1997. HSX has since spun off several subsidiaries and programs, including HSX Research, a subscription-based market research service, with predictions based on their markets. According to The New Yorker magazine, HSX correctly picked 35 of the 40 Oscar nominees in the eight biggest categories.

While effective, many believe these terrorism futures to be immoral. They are betting on horrific acts, in effect hoping they will occur. Senator Tom Daschle has gone so far as to say they are "an incentive actually to commit acts of terrorism". Then again, life insurance is essentially the same thing. Another suggested problem is that terrorists themselves may bid up certain futures, in order to provide disinformation.

All said, this is currently in the research phase. And to prevent any research (think stem cells) on questions of morality is generally a bad idea.

Major Sources:

Wolfers, Justin and Zitzewitz, Eric. "The Furor of 'Terrorism Futures'", Washington Post, page A19. http://www.washingtonpost.com/ac2/wp-dyn?pagename=article&node=&contentId=A5696-2003Jul30¬Found=true

Shachtman, Noah. "The Case for Terrorism Futures", Wired News. http://www.wired.com/news/politics/0,1283,59818-2,00.html

"The Terrorism Futures Market is Immoral" and "Wait, Let's Talk About This". Opinions, The Tech (MIT student newspaper).