What If....2003 Prediction Markets for Iraq

Join me for a moment of pure speculation. Robin Hanson not only gets his way with using betting markets for national security purposes, he gets it several months or even a year earlier than when the program was terminated (in July of 2003) by political non-sense. If you believe the disgruntled employees of the CIA, Pentagon, and White House you get the distinct idea that everyone knew that Iraq was not the threat the President was making them out to be. You get the impression that everyone knew but those doing the cheerleading for the media, but were pressured into shutting up.

Suppose they took this information with them to the betting market, which I understand the proposal was going to be small bets around $10 made by those in the CIA and Pentagon. They can't speak up to their superior's for whatever reason, but they are able to anonymously (to their superiors) buy and sell shares on the following stocks:

1. Weapons of Mass Destruction will be found In Iraq by (dd/mm/yyyy).
2. U.S. military will be able to exit Iraq within X years of occupation.
   
3. Total cost of U.S. military expenditures on Iraq will be under $100 million in 3 years.
4. Iraq will hold a formal national democratic election by (dd/mm/yyyy).

Now, imagine the public, media, and political opponents see these shares trading close to zero. Does it change the course of events? Does the political pendulum swing the other way and we stay out of Iraq? Suppose Bush invades anyway (as I suspect he would have, regardless of betting markets), does the accuracy of betting markets become glorified for having provided warning that our actions were misguided?

Pure speculation, I know. I like how this speculation has a "Robin Hanson saves the world" ring to it. Ironically, it was an idea killed by those same people who berate Bush & Company for ignoring evidence from their intelligence agencies, or at least not passing that info along.