November 9, 2007 | 3:33 pm
Posted by Brad A. Greenberg
Imagine you could predict the future. With precision. And all you were doing was using a beefed up version of John Nash’s game theory formula. Well, GOOD magazine (whose founder I profiled for an article in next week’s JJ) has a cover story on a guy who can.
His name is a mouthful—Bruce Bueno de Mesquita—and he’s being hailed as the New Nostradamus, making this lead quote oh-so fitting: “Some people think Bruce is the most brilliant foreign policy analyst there is,â says one colleague. âOthers think heâs a quack.”
The chairman of NYU’s department of politics, Bueno de Mesquita (mmm, I’m hungry) has been more accurate in his predictions than the CIA.
âWe tested Bueno de Mesquitaâs model on scores of issues that were conducted in real timeâthat is, the forecasts were made before the events actually happened,â says Stanley Feder, a former high-level CIA analyst. âWe found the model to be accurate 90 percent of the time,â he wrote. Another study evaluating Bueno de Mesquitaâs real-time forecasts of 21 policy decisions in the European community concluded that âthe probability that the predicted outcome was what indeed occurred was an astounding 97 percent.â Whatâs more, Bueno de Mesquitaâs forecasts were much more detailed than those of the more traditional analysts. âThe real issue is the specificity of the accuracy,â says Feder. âWe found that DI (Directorate of National Intelligence) analyses, even when they were right, were vague compared to the modelâs forecasts. To use an archery metaphor, if you hit the target, thatâs great. But if you hit the bullâs eyeâthatâs amazing.â
His method is more psychology than foreign policy. He determines the motivations of the players involved in a specific issue, applies those to a “rational-choice” model, which uses game theory as its backbone, and arrives at an expected outcome. He’s had a lot of amazing gets, but this was my favorite mentioned in the article:
His model predicted that upon Khomeiniâs death, an ayatollah named Hojatolislam Khamenei and an obscure junior cleric named Akbar Hashemi Rafsanjani would emerge to lead the country together. At the time, Rafsanjani was so little known that his name had yet to appear in the New York Times. Even more improbably, Khomeini had already designated his successor, and it was neither Ayatollah Khamenei nor Rafsanjani. Khomeiniâs stature among Iranâs ruling clerics made it inconceivable that they would defy their leaderâs choice. At the APSA meeting subsequent to the articleâs publication, Bueno de Mesquita was roundly denounced as a quack by the Iran expertsâa charlatan peddling voodoo mathematics. âThey said I was an idiot, basically. They said my work was evil, offensive, that it should be suppressed,â he recalls. âIt was a very difficult time in my career.â Five years later, when Khomeini died, lo and behold, Iranâs fractious ruling clerics chose Ayatollah Khamenei and Hashemi Rafsanjani to jointly lead the country.
Anyway, with the much-anticipated peace forum at Annapolis coming up between Israeli PM Ehud Olmert and Palestinian President Mahmoud Abbas, New Nostradamus offered this model for achieving piece in the most contested—and holiest—strip of land in the Middle East.
âIn my view, it is a mistake to look for strategies that build mutual trust because it ainât going to happen. Neither side has any reason to trust the other, for good reason,â he says. âLand for peace is an inherently flawed concept because it has a fundamental commitment problem. If I give you land on your promise of peace in the future, after you have the land, as the Israelis well know, it is very costly to take it back if you renege. You have an incentive to say, âYou made a good step, itâs a gesture in the right direction, but I thought you were giving me more than this. I canât give you peace just for this, itâs not enough.â Conversely, if we have peace for landâyou disarm, put down your weapons, and get rid of the threats to me and I will then give you the landâthe reverse is true: I have no commitment to follow through. Once youâve laid down your weapons, you have no threat.â
Bueno de Mesquitaâs answer to this dilemma, which he discussed with the former Israeli prime minister and recently elected Labor leader Ehud Barak, is a formula that guarantees mutual incentives to cooperate. âIn a peaceful world, what do the Palestinians anticipate will be their main source of economic viability? Tourism. This is what their own documents say. And, of course, the Israelis make a lot of money from tourism, and that revenue is very easy to track. As a starting point requiring no trust, no mutual cooperation, I would suggest that all tourist revenue be [divided by] a fixed formula based on the current population of the region, which is roughly 40 percent Palestinian, 60 percent Israeli. The money would go automatically to each side. Now, when there is violence, tourists donât come. So the tourist revenue is automatically responsive to the level of violence on either side for both sides. You have an accounting firm that both sides agree to, you let the U.N. do it, whatever. Itâs completely self-enforcing, it requires no cooperation except the initial agreement by the Israelis that they are going to turn this part of the revenue over, on a fixed formula based on population, to some international agency, and thatâs that.â
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