Gaming economic warfare

Wiggins at Opposed Systems Design posted a link to a Politico story on an attempt to game economic great power conflict at the Warfare Analysis Laboratory. This is a fascinating concept, and I hope it's something that gets developed further.

“This was an example of the changing nature of conflict,” said Paul Bracken, a professor and expert in private equity at the Yale School of Management who attended the sessions. “The purpose of the game is not really to predict the future, but to discover the issues you need to be thinking about.”

Several participants said the event had been in the planning stages well before the stock market crash of September, but the real-world market calamity was on the minds of many in the room. “It loomed large over what everybody was doing,” said Bracken.

Bracken is precisely the person you would want at this sort of event. I've mentioned Bracken before here. It's not clear if he had any role in the design of the game, but it wouldn't surprise me if he did. Details are (as usual in this sort of story) sketchy but intriguing.

The event was unclassified but has not been made public before. It is regarded as so sensitive that several people who participated declined to discuss the details with POLITICO. Said Steven Halliwell, managing director of a hedge fund called River Capital Management, “I’m not prepared to talk about this. I’m sorry, but I can’t talk to you.”

Officials at UBS also declined to comment.

Participants described the event as a series of simulated global calamities, including the collapse of North Korea, Russian manipulation of natural gas prices, and increasing tension between China and Taiwan. “They wanted to see who makes loans to help out, what does each team do to get the other countries involved, and who decides to simply let the North Koreans collapse,” said a participant.

There were five teams: The United States, Russia, China, East Asia and “all others.” They were overseen by a “White Cell” group that functioned as referees, who decided the impact of the moves made by each team as they struggled for economic dominance.

At the end of the two days, the Chinese team emerged as the victors of the overall game – largely because the Russian and American teams had made so many moves against each other that they damaged their own standing to the benefit of the Chinese.

Bracken says he left the event with two important insights – first, that the United States needs an integrated approach to managing financial and what the Pentagon calls “kinetic” – or shooting – wars. For example he says, the U.S. Navy is involved in blockading Iran, and the U.S. is also conducting economic war against Iran in the form of sanctions. But he argues there isn’t enough coordination between the two efforts.

And second, Bracken says, the event left him questioning one prevailing assumption about economic warfare, that the Chinese would never dump dollars on the global market to attack the US economy because it would harm their own holdings at the same time. Bracken said the Chinese have a middle option between dumping and holding US dollars – they could sell dollars in increments, ratcheting up economic uncertainty in the United States without wiping out their own savings. “There’s a graduated spectrum of options here,” Bracken said.

It is rare to find such a perfect example of the right way to frame the benefits derived from a game in a press report. The result that 'China won' is next to meaningless, but Bracken's comments have some real value.


On an only tenuously related note, here is a clip from Bloggingheads.tv that touches on Nassim Taleb's ideas about uncertainty, previously discussed here and here, as applied to the financial crisis:




This isn't directly relevant to gaming, but it does reinforce Bracken's point about the economic game not being about predicting the future, but rather about identifying issues to think about. Gaming in general is a very poor predictive tool, all the more so when applied to something as ridiculously complex as the global economy.

Disclosure: I work for Bloggingheads.tv on an irregular basis.

Some semi-relevant links

A few links that are slightly off topic for this blog, but only slightly....

• A school with a game-based curriculum is opening in NYC next fall. It's currently looking for teachers and students:

  Quest supports a dynamic curriculum that uses the underlying design principles of games to create highly immersive, game-like learning experiences for students. Games and other forms of digital media also model the complexity and promise of "systems." Understanding and accounting for this complexity is a fundamental literacy of the 21st century.

• The U.S. Institute for Peace is developing what it calls the Open Simulation Platform (OSP), which would be an open source online simulation development tool, hopefully streamlining and simplifying the process of simulation generation and execution to allow more trainers and educators to make use of this type of tool: (via Wiggins)

  The problem describing the OSP is that it is different things to different audiences. To students it is an online world. (Albeit right now it is a very simple text and static image based world.) To instructors/facilitators it is an online library to select a simulation and tools to run a simulation. To simulation authors it is a guide (someday we hope a wizened guide) to help one construct meaningful training simulations. And finally, to a community we hope that it becomes an improved marketplace of ideas: a place where people can really debate their beliefs in more meaningful ways. When proving one’s point about something comes down to creating a realistic and sophisticated simulation that demonstrates that point, we will have arrived on that level.

• The Economist recently ran a story about Alternate Reality Games (ARGs). These events generally blend online and real-world elements, usually involing both puzzles and narrative. Their (commercial) origins were as alternative advertising for films and the like, but they are being applied to a variety of other purposes. As is often the case with The Economist, it's a pretty good introduction to the subject:
  

  It was back in 2001 that the first commercial ARG, “The Beast”, a promotional campaign for Steven Spielberg’s film “A.I.: Artificial Intelligence”, began blurring the line between reality and fiction. Instead of formally announcing the start of a game, ARGs merely leave clues for potential players to follow: a subtle image on a poster, perhaps, or a cryptic message on a website. Fans must piece together the narrative—that’s the “alternate reality”—on their own. ARGs are characterised by their reliance on technology and teamwork, and are often shrouded in mystery until they end, weeks or even months later. Only then is the full story (and the product being promoted) revealed.

  Having started off as marketing tools for films and video games—as with “The Beast”, or “I Love Bees”, an ARG created to promote “Halo 2”, a video-game, in 2004—ARGs are now entering the mainstream. Consider “The Lost Ring”, commissioned by McDonald’s for the 2008 Olympics. Designed by Jane McGonigal, an ARG pioneer who used to work at 42 Entertainment, the game brought together players across six continents to uncover a story of amnesiac athletes and to recreate a supposedly lost (but actually fictional) ancient Olympic sport. “Most people’s experience of the Olympics is vicarious,” says Ms McGonigal. “I wanted to give people a more social and active way to experience them.” This ARG, linked to a global sporting event, sponsored by a multinational company and run in seven languages, shows how far ARGs have come.

Eliot Cohen on punditry (and the implications for gaming)

I missed this when it was published, but Eliot Cohen had a great op ed in the Wall Street Journal in January, shortly after stepping down as senior adviser to SecState Rice. It doesn't directly touch on gaming, but it provides some very useful suggestions for pundits and policy commentators on the outside of government looking in:

Most commentators have a radically imperfect view of what's going on. Those on the inside, including at the very top, know more, though less than one might think. Government resembles nothing so much as the party game of telephone, in which stories relayed at second, third or fourth hand become increasingly garbled as they crisscross other stories of a similar kind ("That may be what the Russian national security adviser said to the undersecretary for political affairs on Wednesday, but it's not how the Turkish foreign minister described the Syrian view to our ambassador to NATO on Thursday.") Add to this the effects of secrecy induced by security concerns, as well as by the natural desire to play one's cards close to one's vest, and the result is a well-nigh impenetrable murk of policy making.

But it's even murkier on the outside. "Occasionally an outsider may provide perspective; almost never does he have enough knowledge to advise soundly on tactical moves," Henry Kissinger once remarked. Or as the White House correspondent of one major national newspaper once confided to me, "We really don't have a clue what's going on in there."

What, then, is a pundit to do? The best commentary has an impact, less because it offers new ideas (most ideas have been considered, however incompletely, on the inside) than because it clarifies problems or solutions that the insiders have only vaguely or incompletely considered. A tight, well-written, and carefully reasoned examination of a policy problem will bring into focus an issue that the officials have not had the time, or often the literary skill, to capture precisely. That kind of analysis is very much worth reading.

Invariably, a pundit will prescribe solutions. In doing so, he should follow the advice of the late Raymond Aron, the wisest French policy intellectual of modern times: Never criticize a policy unless you can convincingly depict a better course of action. Aron, like many of the greatest commentators on policy, had virtually no experience in government, but great empathy for those in a position to decide. Empathy -- the capacity for imagining what it is like to be the other -- is an essential quality for the thoughtful pundit. Policy makers, of course, prefer sympathy, which is soothing, unnecessary and often harmful.

There's more in the full op ed. It's not hard to see how this could relate to gaming. In a sense, the question of how games can have a policy impact is implicated in this line of thinking. If a game "clarifies problems or solutions that the insiders have only vaguely or incompletely considered" or provides the opportunity for outside commentators to develop the empathy with decision-makers that Cohen describes, that could be a valuable contribution. It is extremely rare for high-level decision-makers to participate in games; the time just isn't available. Cases like the Sigma II game in 1964 are few and far between. Therefore, the utility of games from a policy perspective is at best indirect. Cohen's piece provides some food for thought on maximizing the usefulness of games to current policymakers.

(Found this piece thanks to Wiggins at Opposed Systems Design)

Update: Rex Brynen has more thoughts on this, including an excellent example from his own experience (and some very kind words) at PaxSims. See also the comment by Wiggins.