Re: Terrorism Futures Market: Pro's and Con's of casino politics

[Jurriaan Bendien <bendien@xxxxxxxxxxxx>]

To Jim Devine:

Excellent thoughtful approach, thanks very much for those posts, that really
gets to the crux of the controversy. At the risk of stating the obvious and
oversimplification, the purely cynical assumptions of US traders behind a
terrorism futures market are threefold:

(1) that terrorism is profitable, or can be made into a profitable private
capitalist activity, which adds to American economic growth, apart from arms
and military sales - essentially false, since the bulk of speculation, like
arms and military sales, does not add anything to real wealth itself, but is
rather an appropriation of claims to other goods, assets and services which
could stimulate demand somewhat (military Keynesianism, which is not
ideologically compatible with neo-liberalism and neo-conservatism since the
role of the state and its expenditure should be reduced, not increased), and
terrorist attacks generally lower consumer and investor confidence

(2) that the concept of "fluctuations in likelihood of occurrence" applies
to terrorism, because although we can do some things to prevent its
occurrence, it is in part an uncontrollable game of chance anyway, which can
be predicted only in probabilistic terms, rather than - let's say, for the
sake of argument - in fairly simple iterative terms

(3) that the greater the socio-political "instability", and thus the greater
the fluctuation in the likelihood of occurrence of terrorism, the more
private profits can be made by the judicious speculator, who surfs on the
bull run and sells on a dip in the market,

(4) that speculators in terrorist futures are themselves immune to
terrorism, or, if they are not, other speculators can make money from
terrorist attacks directed against colleague speculators in terrorist
futures.

The hidden premiss in (2) is that the actual political policies that the US
government pursues may, or may not, be able to affect the probability of
terrorist occurrence, but the whole point is that this doesn't matter,
because traders can make money by gambling about terrorist futures,
regardless of what happens, provided the war against terrorism is maintained
and continued, since this fact alone increases the likehood of the
occurrence of new terrorist acts. At most we could say, that an erratic
government policy stance or Congressional debate might be more profitable,
since the increase in uncertainty will generally increase the margin of
fluctuation in likelihood of occurrence.

The implication of this is, that the possibility of terrorist acts is
already accepted as a "fact of life" which one should not be disturbed
about, but rather see as an opportunity to make money, even if George Bush
happens to be viewed as a fundamentalist christian who "kills with God on
his side", thereby increasing the likelihood of terrorism.

In turn, that means that the huge media propaganda effort about the war
against terrorism has already (1) failed, people just don't care after a
while, they will shrug and say "shit happens", I just buy a revolver and
carry it with me, but (2) also succeeded, because if people don't care and
buy revolvers, then we can pursue any old foreign policy in the name of the
permanent war against terrorism and other "invisible" enemies, which may or
may not become visible as we fight against them, on a preventative basis.
This suggests that talking about terrorism is profitable, no matter how you
look at it.

The only moral justification of a futures market in terrorism I can think
of, is that it would generate new knowledge about the likelihood of
terrorist occurrence, consequent on socio-political events, of a type that
would help to inform governments and citizens and allow them to adjust their
behaviour accordingly. However, this is a reactive, after-the-fact morality,
based on extrapolations which have already occurred, which assumes that
terrorist acts are inevitable, and that nothing much else can be done to
decrease terrorist activity.

The question of "how might we decrease the likelihood of occurrence of
terrorism" is of course not rigorously pursued at all in this controversy,
nor is the question of why the private sector would have better sources of
information than the government about the likelihood of occurrence of
terrorist acts answered. The latter question is interesting, because,
supposing that the private sector does demonstably have better information,
then why bother with huge government investments in anti-terrorist policies
?

Looking now at the matter from the point of the would-be terrorist himself
or herself, largely ignored in the literature, it is clear that terrorists
are, by this initiative in terrorist market futures, divided in at least
four possible camps:

(1) One camp endorses a futures market in terrorism, because a terrorist can
invest in the terrorist futures market himself, and make money out of his
own activity, for himself (if he survives) or for his peer group.

(2) The other terrorist rejects the futures market in terrorism, and feels
that it is justifiable to engage in terrorist acts against those who would
make money out of his terrorist activity. This implication suggests, that a
futures market in terrorism might not be such a defensible idea, other than
for the true gambling addict with real balls, willing to die for his
addiction.

(3) Of course I have neglected yet another possibility, that of so-called
"true" terrorism: in this case, the terrorist invests in futures, then
commits his terrorist act, then collects his speculative gain, and then
tries to kill off every other known speculator who made money from his
terrorist act, or at least, those whom he disagrees with (these are the most
interesting problems for the forecasting business).

(4) Finally, a "mixed approach": sometimes terrorism is profitable for the
terrorist, sometimes it is not, and sometimes he agrees with the speculator,
and sometimes he is inclined to shoot the speculator.

Personally I have never studied the literature on terrorism in detail (most
of it is useless anyway), I just read things like Doris Lessing's The Good
Terrorist, and Ernest Mandel's Delightful Murder: A history of the crime
story (Pluto Press). Therefore, there may be some permutations I have missed
in the argument, other ways of looking at it. Any takers ?

As regards Mandel's book, he ends his story with a reference to a
computer-game in which the player has the role of a pimp, pimping raised to
the level of an intellectual diversion; he further refers to crime novels
where it is no longer clear, who are the good guys and the bad guys, the bad
guys might be the good guys and so forth. But this is obviously innocent
chickenfeed compared to a futures market in terrorism, one ought in my
opinion to think again about the full implications of capitalist decadence
here. I mean, in both the first world war and the second world war, there
were plenty speculators as well (a story which is not often told), but these
days the tools available of speculation are virtually unlimited.

What I wonder about, is what the US military stationed in Iraq would think
about this, the fact, that if they are stationed in Iraq or anywhere else on
the planet in the future, with a good chance of dying through terrorist or
guerilla assaults, their "fellow Americans" might be making money out of
bets about the probability of success or failure of their mission.

Best regards

Jurriaan