WikiLeaks and How the US Government Might be the Next Enron

Monday, August 2, 2010

I just reread Malcolm Gladwell's 2007 essay, "Open Secrets: Enron, Intelligence and the Perils of too much Information." While I'm not one for financial analysis, Gladwell's strength always lies in his ability to make a number of complex factors easily understandable. The point of the whole essay is this: in our complex and information filled times, transparency - in accounting or otherwise - is simply not enough to ensure against potential problems, corruptions or dangers. More important than transparency is the presence of someone reading and understanding everything that is going on.

When was the last time you thought figuring out a 20% tip between a party of four at a restaurant was simple? Now multiply that by one of the largest energy companies in America at the time. That is one big table. And then it turns out each person in your party is borrowing money from the person on his left, with an IOU written on a napkin. How many napkins do you have? Alot. Three million pages worth, just in Enron's Special Purpose Entitiy (SPE) documents, according to Gladwell. By the time the Powers Committee took a look at it it had been distilled into a two hundred page document, and that was a summary of the summaries of only the most important summaries of "the most significant transactions."

Gladwell points out that more than enough information was available, mostly online, from Enron's public filings to see what was going on, which is exactly how John Emshwiller, Jonathan Weil, Jim Chanos and at least one group of Cornell Business School students figured out Enron was "overvalued" and "may be manipulating it's earnings." However, it took a massive amount of financial training and, perhaps more importantly, a significant time commitment to figure it out.

This is where I find a culturally alarming parallel to the current release of ninty-two thousand pages of Afghanistan war-related documents on wikileaks.org. Most reporters and analysts seem most alarmed about the fact that these documents were supposed to be secret government information. The secrecy of absolutly every aspect of the US military is largely a matter of tradition. Of course, there are Very Important Things that Must Be Kept Secret, there always will be. But I think I can safely wager that the majority, and perhaps all of these reports are not part of that group of Very Important Things. In the context of important wartime information, these are the "last cleaned on:" charts taped to the public restroom door of the US war in Afghanistan. Nine thousand pages of them.

Suddenly we can see that the problem may not actually be what we feared. The problem is not that the enemies of the US may have critical information, but that either side, everyone involved, everyone in the modern era, has far too much information available for one person, or possibly even one military, to parse through with any kind of accuracy. We are drowning in it. Micro information. Metadata. Metadata on the metadata. And very few people, if any have the combination of time and training to decipher exactly what is going on, aside from the day to day horrors of war. Cleaned by: RL On: 5/24/09 10:15pm.

As of June 7th, 2010, the US war in Afghanistan is the longest war in American history (104 months of engagement), and the further we go into it, the more likely we are to get lost in the paperwork and choked by the metadata. Much of what I look at in my work is the simplification of complicated and interrelated pieces of information, and to be honest I havn't got a clue what a solution to something like this might be, other than of course, shutting down the data machine and going home.