Back many years ago (many, many years ago) National Lampoon had an article about a big national lottery held every holiday. People would pay fifty cents for a form, had to guess a number, and because the number fell within a fairly narrow range (600-800) , making the total something that millions of people would guess frequently, they had to guess 50 smaller numbers, all adding up to the total number. Each number stood for a particular state, and the total, obviously, was the entire US. The person who got all 51 numbers right would win a huge sum of money–ten thousand dollars or some such.

It was a real popular game. Families would get extra blanks so the kids could play, and would be riveted to the television and cheering or groaning as the numbers changed.

What were they betting on?

The number of highway auto accident deaths during the three day holiday period.

It was funny and it was sick, and it was standard fare for the National Lampoon, back in a time when funny and sick were still seen as an odd combination.

It was hilarious and it was horrifying, and it was so well done that I still remember it 25 years later.

A lot of people who read National Lampoon in those days grew up to be neocons. I had a three digit IQ and so didn’t qualify.

It’s easy to picture the younger shitsacks of the neocon movement, like Wolfowitz, Horowitz, P.J. O’Rourke, and Michael Weiner taking pulls on their bongs and getting belly laughs from NatLamp back in the seventies (and O’Rourke was a writer on NatLamp’s staff).

It’s a bit harder to see some of the older fossils, the retreads from Daddy’s administration like Rumsfeld and Poindexter, reading NatLamp, or ever having had a sense of humor.

And of course, it’s impossible to picture Putsch reading NatLamp because for him, it’s a strenuous intellectual effort to puzzle out the instructions on a book of matches.

You can get away with being insane if you also happen to be funny as hell.

Most neo-cons aren’t funny. They’re just insane.

It probably shouldn’t have come of much of a surprise to folks when word came out of Poindexter’s scheme to set up an anonymous online futures market in terrorism. The initiative, called the Policy Analysis Market (PAM) funded by tax dollars, also planned to have investors lay out their money based on market analyses of such things as coups, assassinations, and military attacks.

Ten thousand investors, their identities secret, would lay out their money based on analysis of current events, trying to predict events in advance. According to Poindexter’s office, "Research indicates that markets are extremely efficient, effective and timely aggregators of dispersed and even hidden information. Futures markets have proved themselves to be good at predicting such things as elections results; they are often better than expert opinions."

Only a neo-con could imbrue the market with such perspicacity, intelligence, foresight, wisdom and logic. In reality, the market resembles a large flock of perpetually panicked chickens. Stick 50 market analysts in a room and ask them to say what the market will be doing in two weeks, and you’ll get 50 different answers, all of them wrong.

But two images crossed my mind when I heard about this latest scheme: the Black Sox scandal, and Milo Mindenbender.

The Black Sox scandal was a group of Chicago White Sox baseball players who, in 1919, were accused of gambling on their team to lose the world series.

Imagine if one of those futures investors happened to be highly placed in the Republican party, and suddenly realized he could make a killing by betting that the President would be assassinated in the next three months. Remember, these guys are already looking to profit from the world’s misery, hoping for revolutions, assassinations, wars, and natural disasters. Morals and ethics aren’t going to be real big items with this crowd.

When 9/11 happened, there was a large amount of unusual market activity in the days prior, activity that reaped immense profits for someone. The Putsch junta promised to investigate that, and we haven’t heard a word since. I’m betting that administration contacts knew something was coming, and positioned themselves to make a fat profit off of it.

Milo Mindenbender was a buyer and seller in Joseph Heller’s brilliant "Catch 22" who sought to privatize World War II. He convinced everyone in the squadron that because everyone had a share in his "Syndicate," everyone would profit, although the central character, Yossarian, was never able to figure out how Milo could buy eggs for five cents each in Palermo and sell them for a profit at three cents each in Malta.

Milo ended up taking a contract from the Germans to bomb and strafe his own squadron. But it was ok. Everyone had a share. Everyone profited. Including those killed in the raid.

It was capitalism at its finest, they all agreed.

Capitalism is great at doing what it’s supposed to do, which is making money for people. As long as the wealth isn’t allowed to concentrate into a small pod of super-wealthy (as is happening in America today) it makes for a prosperous and happy land. Capitalists can make a nation strong, although they cannot make it great. Capitalism doesn’t address intangibles such as personal liberties, fairness, social safety nets, or much in the way of social needs which of necessity cannot be profitable. Capitalism is amoral. Capitalism that has run amok is viciously amoral.

Word is that Poindexter is going to lose his job over this latest. (He had previously proposed the Total Information Awareness idea, complete with logo of the eye from atop the one dollar pyramid staring unblinkingly at the globe. When there was an uproar over the government accessing all data bases that had any information on anyone in the world, they pretended to scrap the idea and quietly brought it back later as the "Terrorism Information Awareness Program. They are only gathering all that information to catch terrorists. That’s ok, then.) He was a ludicrous choice for government service, having previously disgraced himself and been convicted in the Contra-Iran scandal for Ronbo and Pappy.

But somewhere, a twenty-first century version of Milo Mindenbender is setting up a secret private sector consortium to do exactly what Poindexter wanted the Pentagon to do. They will be betting on how many American troops get killed where, and when, and how.

And chances are good that some will turn out to be wearing black socks, and be betting against America and rigging it so we lose. Just like they did in 1919.

Just like they did on 9/11.

A few days later, Weasel Arne wrote the following thoughtful comment:

It is not the idea of "trading in death" that is wrong
with this idea (consider, e.g. the respectable and staid
insurance industries).

The proponents of the "terrorism futures market" insist
that futures markets have been more efficient than other
predictors in 'predicting' such things as elections, and
thus, why not use this wonder tool?

In doing so, the proponents claim that such type markets
can uncover dispersed or even "hidden" information that
may be of interest to people analysing these market trends.

The seamy underbelly of this claim is that we normally
call such information "insider trading". Elections are
not immune from the prior actions (and/or knowledge of those
actions) of those that have such a financial interest in the
outcome. They can even be "gamed" in much the same
way as insiders can rig a IPO or futures market. What's
more, the gaming can be done by insiders on either side
of an outcome. It's hard to see what use a post hoc analysis
of futures data would reveal that is not known already to at
least some of the players. About the only hope for such
markets might be to identify the "insiders" trading in such
markets, and to collar the ones that are not playing for our
team. But knowing that this market has been set up for
that very purpose, the real bad guys would be quite unlikely
to indulge.

The fiction that such markets operate by some magical
"invisible hand" untainted by human foibles -- a "knowledge"
based on some pristine and detached soothsayer's crystal
ball -- and have some "wisdom" apart and divorced from the
actors in them, has been a legend of free market proponents
for a long time. In fact, futures markets are gambles that you
know more than the next person (many a time to the dismay
of people that think such markets are a level playing field).
Those touting such markets as a source of "hidden information"
should acknowledge where this "hidden information" comes from,
and then explain why this hare-brained scheme will work.
And more importantly, why it won't then be gamed to our horror
by those with only personal pecuniary interests and fewer scruples.

[snip]

Cheers,

-- Arne Langsetmo