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Pentagon halts terror betting plan

By GEORGE EDMONSON
The Atlanta Journal-Constitution

YOUR TURN What do you think of the idea of a terrorism "stock market?"   Good idea if it would help gain intelligence on potential terrorist plans. 37% 624   Bad idea. Wagering on possible future terror attacks is immoral. 49% 836   No thanks. I moved all my money back into CDs. 14% 245 Total Votes   1705 This survey is not a scientific sampling and does not reflect the opinion of the general public, but only of those who choose to participate. Related: • Just what are futures markets? On the Web: •  Policy Analysis Market •  DARPA's FutureMap

WASHINGTON -- Facing fierce criticism, the Pentagon on Tuesday killed a program in which traders would have speculated on the prospect of future terrorist activities.

The abrupt halt to the program, which envisioned a Web-based futures market that Defense Department officials said could help forecast catastrophic events, came a day after it was disclosed by two Democratic senators.

Congressional reaction Tuesday was strong from members of both parties.

Sen. John Warner (R-Va.), chairman of the Senate Armed Services Committee, said he and Sen. Pat Roberts (R-Kan.), who heads the Senate Select Intelligence Committee, agreed that "this program should be immediately disestablished."

At a Senate Foreign Relations Committee meeting where Deputy Defense Secretary Paul Wolfowitz was testifying on the reconstruction of Iraq, Sen. Barbara Boxer (D-Calif.) called the program "bizarre and morbid" and "a sick idea." She said the people who came up with the idea should be fired.

Wolfowitz, while calling the agency that developed the program "brilliantly imaginative in places where we want them to be imaginative," said the group might have gotten "too imaginative." He added that he had learned of the program from reading a newspaper story Tuesday morning and was told the project was going to be terminated.

Senate Minority Leader Tom Daschle of South Dakota said ending the program was a "step in the right direction." The Democrat called on Defense Secretary Donald Rumsfeld to "immediately and publicly renounce the Pentagon's plan to trade in terror and issue a public apology and an explanation to the families of the victims of the Sept. 11 terror attacks, our men and women in the military, and the American people."

The Policy Analysis Market was formulated in the Defense Department's Defense Research Projects Agency, which helps develop a wide range of technology programs.

According to the agency's Web site, the futures market would have operated much like those in which commodities are bought and sold. Traders would attempt to profit financially by making early, correct predictions. One example given of a possible contract was "betting" that the Jordanian monarchy would be overthrown when the United States and Iraq were at war.

The concept put forth for the program was to use traders' knowledge and abilities to help predict future events, which could help in devising safeguards. Investors were to begin registering Friday, and trading was to start Oct. 1.

The agency, known as DARPA, has come under heavy criticism for an earlier program that is now called Terrorism Information Awareness. It would use computers to survey and analyze enormous amounts of information about individuals in the search for terrorists. Critics contend it presents a danger to privacy rights, while the agency has said it would follow all applicable legal restraints.

Initially called Total Information Awareness, the program is headed by former Adm. John Poindexter, who was President Ronald Reagan's national security adviser and a key figure in the 1980s Iran-Contra scandal.

Sen. Ron Wyden (D-Ore.) said the terrorism futures market was part of Poindexter's operation.

Wyden and Sen. Byron Dorgan (D-N.D.) -- the senators who disclosed the existence of the program Monday -- held a Capitol Hill news conference Tuesday.

"The question is what more is being planned," Dorgan said. "What additional programs are there that we don't yet know about. And we're asking the Pentagon for a full report -- Mr. Poindexter, especially -- for a full report on every single program they're working on and looking at what resembles this sort of thing."

Defense Department spokesman Lawrence Di Rita said Poindexter continued "at the moment" to serve in DARPA. Asked later whether that moment "is going to continue," Di Rita replied, "I don't have anything to announce on that, I really don't."