Re: Private U.S. Guards Take Big Risks for Right Price

[Major Variola (ret)]

At 09:03 AM 4/3/04 -0500, R. A. Hettinga wrote:
>At 1:26 PM -0800 4/2/04, Major Variola (ret) wrote:
>>Physics, because large entities have different properties (eg
>>surface-to-mass ratio; inertia) than small entities.
>
>Well, certainly, that's the current wisdom about such things.
>
>However, I'm talking about markets, and firms, which are all
>creatures of information flow. As William Gibson put it once, a
>corporation is a being which eats information and shits money.

We are talking about mercs, not selling bits on MercNet.  Mercs are
physical.
Thus their resources (satellites, rockets, tanks, etc) are *controlled*
by Men With Guns.   Who don't like to share the shiniest toys.

>In those terms, then, since, Coase's theorem again, reduced
>transaction cost (lowered by lower information gathering, and most
>important to cypherpunks, lower transaction *security* costs lowering
>transaction execution/settlement/clearing) how do we get the large
>behavior current in modern markets without large firms?

Cheaper info cuts out middlemen, sure; but it does nothing to
permit mercs access to physical-technology that they need
in the physical world.

>Lots of little devices acting in common, in their own self interest,
>using markets to price their services.

Devices are physical.  MwG control the physical.

>Somewhere, on the Shipwright site, is a John Young - discovered DOD
>paper from the mid-90's about "The Mesh and The Net", which looks
>like a toe-hold on the idea of geodesic warfare. I used to joke about
>keeping the landmines in your front yard paid or they wouldn't let
>you out the door. :-).

Sure, meshes mean you may not need satellites or fixed base stations
for your comms.  Big deal.  The mesh-radios may be controlled,
and regardless, you need more than radios to be a merc.  Get
that through your head.

>So, I would bet that lower costs of market entry means that smaller
>firms could compete in large, temporary groups, in the same way that
>market sell-off stampedes happen, only with guns.

You're too stuck on bits and forgetting about atoms.

>The net allows more collaboration between the troops without central
>control,

Yawn.  Disintermediation will happen, its just not enough.  Atoms
matter.

Re: Private U.S. Guards Take Big Risks for Right Price

[R. A. Hettinga]

At 10:10 AM -0700 4/5/04, Major Variola (ret) wrote:
>  Atoms
>matter.

*Markets* matter, which *was* my point, originally in this thread. Not Mercs.

Markets are how you convert bits to atoms.

Cheers,
RAH

-- 
-
R. A. Hettinga 
The Internet Bearer Underwriting Corporation 
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

Re: Private U.S. Guards Take Big Risks for Right Price

[R. A. Hettinga]

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At 1:26 PM -0800 4/2/04, Major Variola (ret) wrote:
>Physics, because large entities have different properties (eg
>surface-to-mass ratio; inertia) than small entities.

Well, certainly, that's the current wisdom about such things.

However, I'm talking about markets, and firms, which are all
creatures of information flow. As William Gibson put it once, a
corporation is a being which eats information and shits money.

In those terms, then, since, Coase's theorem again, reduced
transaction cost (lowered by lower information gathering, and most
important to cypherpunks, lower transaction *security* costs lowering
transaction execution/settlement/clearing) how do we get the large
behavior current in modern markets without large firms?

Easy. Swarms, if you will, ala Kevin Kelly's "Out of Control."

Lots of little devices acting in common, in their own self interest,
using markets to price their services.

Remember the scene in Stephenson's "The Diamond Age" about defense in
depth, where you enter a perimeter and little diamond-skinned
dirigibles clot around you and slow you down, and the more force you
present, the more derigibles there are, including the ones with
lethal capabilities? Or the bit about "warfare" being conducted at
the nano-level and whatshername's brother dying from allergies, for
the lack of a better term, from all the airborne ditritus? (They just
figured out that buckyballs might be a pathogen if inhaled this week,
if you remember...)

Somewhere, on the Shipwright site, is a John Young - discovered DOD
paper from the mid-90's about "The Mesh and The Net", which looks
like a toe-hold on the idea of geodesic warfare. I used to joke about
keeping the landmines in your front yard paid or they wouldn't let
you out the door. :-).

So, I would bet that lower costs of market entry means that smaller
firms could compete in large, temporary groups, in the same way that
market sell-off stampedes happen, only with guns.

The net allows more collaboration between the troops without central
control, in the same way that more information allows capital markets
to price transactions without central control. Leadership is
temporary, and non-monopolistic, non-dynastic.

Anyway, that's all I can think about at the moment. Off to breakfast
at Auntie B's.

Cheers,
RAH

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-- 
-
R. A. Hettinga 
The Internet Bearer Underwriting Corporation 
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

Re: Private U.S. Guards Take Big Risks for Right Price

[Major Variola (ret)]

At 03:04 PM 4/2/04 -0500, R. A. Hettinga wrote:
>Nozick argues force-monopoly naturally emerges from *any* force
>market, that, IIRC, associations will collude and eventually merge
>under peaceful circumstances, and, of course, if one fights the
>other, it takes the other's turf.
>
>Personally, I wonder if that's an artifact of human switched
>networks, though, but I'm supposed to say that. :-).

The implementation tech shouldn't matter, latency & throughput aside.
Merging vs. fighting vs. stasis is a matter of physics, and game theory.

Physics, because large entities have different properties (eg
surface-to-mass ratio; inertia) than small entities.
In the 40s it was a lot easier for the US
to muster the resources for the Bomb than it was for say England.
Similarly with spy satellites.  In a cold environment large animals
do better; in a modern tech environment high-investment entities do
better.
If you're maintaining territory, large pieces have less boundary to
defend.

Game theory, because the costs to the organism of the fight
may be prohibitive.  Which is why most animals bluff.  And
why China, Russia, etc won't be attacked.  M.A.D.  All your
Taiwanese are belong to us.

An interesting question is what happens when it doesn't
take a large entity to have large force.  The Colt revolver
was an example of this equalization.  So is a fission bomb.
(However anyone could buy a Colt, soon eliminating that advantage.
A. Q. Khan as a 21st century version? :-)

What you get then, as Heinlein wrote, is a very polite society.
(Xor one without a population growth problem :-)   Sort of like
the South when dueling was popular.  Until
the next leap in tech not accessable to all comes around.
(Duelling with AKs would be pretty cool, eh?)

Adding irrationality to game theory gets interesting too.
"Better dead than red" changes the game.
If you can sell your delusions about "heaven" or "patriotism" to
warriors
(and possibly the population that supports them) then the cost-benefit
equation
changes.   Engaging the endocrines is pretty much all the bubblehead in
D.C.
has going for him.

So what does this mean for the geodesic neo-Merc industry?

It means that the US (and other large players) will keep shutter control
on satellites,
will pursue arms dealers, will bomb bomb-plants before they produce.
The tanks that can shoot farthest will still be controlled.  As will the
night
vision stuff, secure comms, etc.  Note that shutter control can include
"accidentally" bombing a chinese embassy in yugoslavia :-)

In smaller terms, private security guards won't be getting fullauto
weapons, high-end
body armor, or the same bugging tech as the USG endorsed ones.

PS: note that if the USG "endorses" a merc group too much, by allowing
them (but not others) to buy the Good Stuff, the USG endangers itself.
The mercs themselves needn't be American.
Israel would be a good example.  (How many Hellfires *does* it
take to hit an old man in a wheelchair?)

Plus you get the awkward political and military problems when your
friends turn enemies.

All this doesn't rule out proxy wars in backwaters (with official or
merc troops),
or underground mafia-style merc wars between factions overlayed on a
government territory, but it does impose constraints on future mercs so
long as the pre-existing nations continue to exist.

Basically no one fucks with the elephants, and the lions are free to
fight
for territory, but mostly they'll bluff between themselves.  (Unless
they're desparate, in which case they'll probably lose.)  And because
you have to share your kill,
there is a cost associated with merging territories.

Re: Private U.S. Guards Take Big Risks for Right Price

[R. A. Hettinga]

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At 8:59 AM -0800 4/2/04, Major Variola (ret) wrote:
>The govt has a monopoly on certain tools of the trade.

Of course, that always hasn't worked right in other industries.

The peculiar institution of geographic force monopoly will be an
interesting test case.

One could imagine how it would devolve, starting with licenses, like
say, letters of marque... :-).


Nozick argues force-monopoly naturally emerges from *any* force
market, that, IIRC, associations will collude and eventually merge
under peaceful circumstances, and, of course, if one fights the
other, it takes the other's turf.

Personally, I wonder if that's an artifact of human switched
networks, though, but I'm supposed to say that. :-).

>And crypto-wise, reputation will clearly be important here.

Ayup. See Pierpont Morgan, an old chestnut from my .sig file, below.

>But yes, obviously, easy communication leads to more optimal
>markets, for both goods and services.

Indeed. Ronald Coase is your friend.

Cheers,
RAH


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-- 
 -
R. A. Hettinga 
The Internet Bearer Underwriting Corporation 
44 Farquhar Street, Boston, MA 02131 USA
"...Character. I wouldn't buy anything from a man with no character if he
offered me all the bonds in Christendom." -J. Pierpont Morgan

Re: Private U.S. Guards Take Big Risks for Right Price

[Major Variola (ret)]

At 10:46 AM 4/2/04 -0500, R. A. Hettinga wrote:
>The idea is, if transaction and price discovery costs fall enough,
>private force companies that auction their services in a free market
>become better than the "public" ones that rely on confiscated tax
>revenue.

Only if they offer comparable services.  Which they won't
be able to, see below.

>I'd expect that sooner or later companies like Blackwater will start
>training recruits in competition with the armed forces instead of
>just hiring vets.

The govt has a monopoly on certain tools of the trade.  Now
while a private army (Wal-Marmy?) can get some of these toys on
the black (free) market, they either can't get the best stuff,
XOR the USG has a problem since that means anyone can
get it.  Everything from surveillance to weapons.

And crypto-wise, reputation will clearly be important here.

But yes, obviously, easy communication leads to more optimal
markets, for both goods and services.

Private U.S. Guards Take Big Risks for Right Price

[R. A. Hettinga]

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I see in the following article the kernel of geodesic markets for
force.

Actually a sort of re-emergence, I suppose, remembering letters of
marque, etc., and my idea about the decline in switching costs
"unwinding" the development of human-switched hierarchical social
networks, with microprocessor-switched geodesic networks creating
diseconomies of scale, and cash-settled auction pricing replacing
"calculated" transfer pricing.

The idea is, if transaction and price discovery costs fall enough,
private force companies that auction their services in a free market
become better than the "public" ones that rely on confiscated tax
revenue.


I'd expect that sooner or later companies like Blackwater will start
training recruits in competition with the armed forces instead of
just hiring vets. Certainly there lots of special ops vets training
civilians in combat shooting at places like Frontsite, etc, for
self-defense, and local militarized police for forced-entry, etc, as
part of the same cold-war spin-off process that created companies
like Blackwater in the first place.

The fact that the NYT, below, is falling all over themselves about
Blackwater being "corporatized" is the icing on the cake, I figure.

:-)..

Cheers,
RAH
- 

<http://www.nytimes.com/2004/04/02/national/02SECU.html?amp;ei=5053&en
=3cdd2de47756be57&partner=NYTHEADLINES_NAT&ex=1081573200&pagewanted=pr
int&position=>

The New York Times

April 2, 2004
SECURITY

Private U.S. Guards Take Big Risks for Right Price
By JAMES DAO

OYOCK, N.C., April 1 - Nestled inconspicuously amid the pinelands
and horse farms of northeastern North Carolina lies a small but
increasingly important part of the nation's campaign to stabilize
Iraq.

Here, at the 6,000-acre training ground of Blackwater U.S.A., scores
of former military commandos, police officers and civilians are
prepared each month to join the lucrative but often deadly work of
providing security for corporations and governments in the toughest
corners of the globe.

On Wednesday, four employees of a Blackwater unit - most of them
former American military Special Operations personnel - were killed
in an ambush in the central Iraqi city of Falluja, their bodies
mutilated and dragged through the streets by chanting crowds.

The scene, captured in horrific detail by television and newspaper
cameras, shocked the nation and outraged the tightly knit community
of current and former Special Operations personnel. But it also shed
new light on the rapidly growing and loosely regulated industry of
private paramilitary companies like Blackwater that are replacing
government troops in conflicts from South America to Africa to the
Middle East.

"This is basically a new phenomenon: corporatized private military
services doing the front-line work soldiers used to do," said Peter
W. Singer, a national security fellow at the Brookings Institution in
Washington who has written a book on the industry, "Corporate
Warriors" (Cornell University Press, 2003).

"And they're not out there screening passengers at the airports," Mr.
Singer said. "They're taking mortar and sniper fire."

The Associated Press identified three of the victims as Jerry Zovko,
32, an Army veteran from Willoughby, Ohio; Mike Teague, a 38-year-old
Army veteran from Clarksville, Tenn.; and Scott Helvenston, 38, a
veteran of the Navy.

 Blackwater declined to identify the dead men, but issued a
statement: "We grieve today for the loss of our colleagues and we
pray for their families. The graphic images of the unprovoked attack
and subsequent heinous mistreatment of our friends exhibits the
extraordinary conditions under which we voluntarily work to bring
freedom and democracy to the Iraqi people."

Though there have been private militaries since the dawn of war, the
modern corporate version got its start in the 1990's after the
collapse of the Soviet Union.

 At that time, many nations were sharply reducing their military
forces, leaving millions of soldiers without employment. Many of them
went into business doing what they knew best: providing security or
training others to do the same.

 The proliferation of ethnic conflicts and civil wars in places like
the Balkans, Haiti and Liberia provided employment for the personnel
of many new companies. Business grew rapidly after the Sept. 11
attacks prompted corporate executives and government officials to
bolster their security overseas.

But it was the occupation of Iraq that brought explosive growth to
the young industry, security experts said. There are now dozens,
perhaps hundreds of private military concerns around the world. As
many as two dozen companies, employing as many as 15,000 people, are
working in Iraq.

 They are providing security details for diplomats, private
contractors involved in reconstruct