Wednesday, August 11, 2004
Free Markets and Osama
(Via Crooked Timber) I really dont know what to make of this interesting/bizarre piece from TechCentralStation, the online home of many a libertarian. As Chris of CT points out, it could well have been written by the staff at Onion. In a nutshell, the author of the TCS piece, James Miller suggests unleashing market forces in the hunt for Osama Bin Laden by upping the bounty on his head to $1 billion.
With a $1 billion reward in place, an international group of intelligence, military and terrorist experts that could credibly claim to have, say, at least a 5% chance of finding Bin Laden could easily raise $20 million or so from the financial markets to finance their search. With several such organizations unleashed on the mountains of Afghanistan and Pakistan, Osama's margin of safety would shrink. If my $1 billion free market experiment were implemented and proved successful, the U.S. could offer very large rewards for other international villains. Firms would then likely come into existence that specialized in capturing different types of criminals, some, for example, going after South American drug barons while others concentrated on Middle Eastern terrorists.
The obvious moral hazard issue aside, I can think of many problems with this approach. What do these companies do *after* they capture OBL, assuming they do? Wind up the firm? Miller also seems to assume the problem with Bin Laden's capture is one of incentive. What makes him think some bounty hunter from Texas will have any more luck in Waziristan than United States special forces? Will the reward differntial between now and the hypothetical be enough to convince the ISI to cooperate more fully in the hunt for OBL?
Maybe, this article deserved to be published in the Onion, after all. However, I maintain an open mind and am willing to hear any counter-arguments from the ultra free-marketers among you. After all, I must keep in mind that it was a bounty hunter (Boba Fett) that turned Han Solo in.
With a $1 billion reward in place, an international group of intelligence, military and terrorist experts that could credibly claim to have, say, at least a 5% chance of finding Bin Laden could easily raise $20 million or so from the financial markets to finance their search. With several such organizations unleashed on the mountains of Afghanistan and Pakistan, Osama's margin of safety would shrink. If my $1 billion free market experiment were implemented and proved successful, the U.S. could offer very large rewards for other international villains. Firms would then likely come into existence that specialized in capturing different types of criminals, some, for example, going after South American drug barons while others concentrated on Middle Eastern terrorists.
The obvious moral hazard issue aside, I can think of many problems with this approach. What do these companies do *after* they capture OBL, assuming they do? Wind up the firm? Miller also seems to assume the problem with Bin Laden's capture is one of incentive. What makes him think some bounty hunter from Texas will have any more luck in Waziristan than United States special forces? Will the reward differntial between now and the hypothetical be enough to convince the ISI to cooperate more fully in the hunt for OBL?
Maybe, this article deserved to be published in the Onion, after all. However, I maintain an open mind and am willing to hear any counter-arguments from the ultra free-marketers among you. After all, I must keep in mind that it was a bounty hunter (Boba Fett) that turned Han Solo in.
