The Economics Of Spies: What Spies Really Do

via What Spies Really Do | Capital Gains and Games.

Bruce Bartlett, in reference to the recent Russian spy case, uses an example from his past to pick on the behavioral economics of spying.  But I think, like anything else, there is more to be understood here than meets the eye.

He writes:

I remembered all this some years later when I was working at the Treasury Department and was on the distribution for some CIA raw material relating to economic issues. Almost all of it was worthless. It involved conversations some CIA agent had with a prominent foreign businessman or economist relaying information that could easily be gleaned from that day’s Financial Times.
Suddenly, I understood what [the spy who had been interviewing me] had been up to. He could have written a memo to his bosses just regurgitating what was in the daily papers, news magazines and other public sources, but that wouldn’t have been very spy-like. It undoubtedly sounded so much better if he could relay the same identical information but say that it had been secured from a high-level congressional staffer. That’s what spies do.


You’re right in part. But there are other factors that might change your opinion of that experience:

0) Yes, a spy is often a bureaucrat, because he exists in a bureaucracy. Often with dismay, frustration and resignation.

1) Spies try a lot of trial-and-error relationship building. In fact, trial and error are a very important part of the business.

2) While Spies are largely from that social group we call ‘nerds’, US spies are usually amazing, wonderful, engaging, intelligent people. But they are, like everyone else, expressions of a bell curve. There are good spies and bad spies and smarter spies and dumber spies.

3) Being a spy is not necessarily doing interesting things and meeting interesting people. And these days, it is a lot more about using relationships to get access to data than it is about human opinion, which is fraught with eror and deception. When a spy talks to you, he is generally looking, like MOST ECONOMISTS ARE, for sources of data, not sources of opinion. And this is very important. Data is more valuable than opinion. They are looking for relationships that will give them access to data. So any conversational content is irrelevant. Your opinion is only a measure of the trustworthiness of the relationship.  The data on the other hand is the reward he is looking for.

4) The value in human intelligence on economic opinion, is not to be found in what you tell them. It’s to be found in the SET of ALL economic opinions found by ALL spies speaking to ALL contacts in any administration and by looking for POLITICAL patterns among the participants. It is not in what you tell them. In fact, a spy will NEVER ask you a direct question regarding his real intentions. This information is then fed to Analysts (Super nerds) who try to obtain value from it.

This is a round-about way of saying that you were just a cog in a wheel. And spying is an art of subtlety. And you shouldn’t try to deduce too much about spying from your experience.

A spy is, in general, engaged in the trial and error process of creating a large number of relationships while looking for opportunities to gain access to some sort of data. It is a very nerdy business. Forensic accounting and forensic communication data are considered valuable to the trade.

By contrast, relationships that are valuable are ‘lottery winnings’. Sure, they target specific people and specific industries, but all the good data is actually in the private sector, and it’s far easier to get there than it is from “another bureaucratic wonk in another bureaucracy who is even more ignorant about that is going on in his country than I am”.

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