The Red Light Incident

Few people apart from Warren Buffet and a handful of others recognized that the financial markets were headed for a meltdown. Even so the nature of the meltdown was unanticipated. Its roots are traceable to Bretton Woods through the Glass-Steagall Act and an unknowable number of rhizomes.

It is an example of a massive closely coupled complex network system that has evolved over decades without any break points. In comparison, the Internet is loosely coupled with many break points. In other words, financial-market networks by unintentional design were a disaster waiting to happen.

Critical infrastructure protection like all forms of planning focuses on identifiable threats and risks to a national infrastructure. It does not identify the infrastructure per se as a risk to national security.

Unlike a risk, a disaster by definition is unknowable. It is the culmination of often small events and a series of human errors that accelerate the main event out of human control.

It is a red light incident. No matter how carefully you plan your route, or how defensively you drive, you can’t protect yourself against the guy running the red light. Chernobyl goes critical. Three Mile Island barely escapes. The Queen of the North sinks.

Nonetheless, some disasters are foreseeable, in particular global warming, the lack of a Canadian electrical and energy grid; market pressures to export water and others.

Introduction

For the past year I have been thinking that the industry around critical infrastructure protection (CIP) is too focused on traditional threat and risk assessments. Not enough thought is given to the role that politics and public policy (and by extension, economics) play in protection. (Economics is just politics by another means.)

The financial meltdown on Wall Street exemplifies our vulnerability to politics and public policy. I won't pretend to understand the economics. From my illiterate perspective, governments have printed too much money; it's concentrated in too few hands; thus trillions of dollars are sloshing around the globe looking for a return on investment; and governments and the financial community have worked together to meet the demand by creating arcane investment opportunities that are just pyramid schemes. It's like musical chairs until the music stops. Finally the system collapsed under pressure from the White House, Wall Street and Capitol Hill. Bin Laden could not have done better.

Instead I hope to focus on critical infrastructures like electricity and water, and examine how vulnerable they are to short-sighted politics and public policy.