In the January 8, 2012 New York Times, columnist and University of Chicago Professor Richard Thaler chides the US Congress and President Obama for not understanding the art of bargaining. He suggests that they read Tom Schelling's Essay on Bargaining. Therein lies the problem. The press (and media in general) have absolutely no idea of how to interpret what's going on when negotiations are unfolding, and Shelling's bargaining model, developed to explain cold war nuclear politics and the logic of Mutually Assured Destruction, won't help at all.
Sunday, January 8, 2012
There are two ways to think about conflicts and conflict resolution efforts. The first assumes that there has to be a winner and a loser -- that the gains to one side must be matched by losses to the other. This is how zero-sum thinking emerged. But, there's another way to think about negotiations, whether between countries, companies, communities or other actors. This involves non-zero sum thinking, or mutual gains. This requires thinking in terms of how each side does in each negotiation relative to its realistic walk-away option (not to what the other side does or doesn't get). Both sides can come out ahead compared to their realistic walk-away options. If two bordering countries are fighting about how much water each can take from the river, then, in zero-sum terms, what one gets the other loses. But, if they can figure out how to work together so that one country can use the water for what it needs (to support provide drinking water to a growing urban population) and then send it along to the other country (assuming the appropriate technology and management systems can be installed), the other can then use almost all the same water over again for a different purpose (such as expanded agricultural production). The issue is not whether one side wins by depriving the other of the water it needs; rather, the question is whether they are smart enough to think of a way that gives both sides the water they need to meet their most important requirements.
When I look at the current political situation in Washington, I don't see any effort being made to help both "sides" meet their interests simultaneously. I'm not talking about bi-partisanship or "playing nice." I understand that politicians in both political parties are mostly interested in getting re-elected and expanding their party's control of Congress and the Executive branch. But, each side also has to meet the interests of its constituents if they want to get elected. That's why negative advertising isn't enough. Each party and each candidate also has to prove that it can and will meet the interests of its constituents.
If I'm on one side of the aisle, and I can offer a way to the other side of meeting the needs of its constituents while also meeting the needs of my backers, I'm likely to have a winning proposal. That doesn't involve compromise. It's not about splitting the difference and showing that I care about the country in general. It's not about the use threats to exact concessions from the other side. I just have to be smart enough to come up with a package that is "good for them, and great for me."
Thaler urges Obama to threaten Congress with substantial "pain" in the future when the President will be in a position (at least for a short time) to block the extension of the payroll tax. He suggests trading a promise to inflict less pain in the future for concessions from the Republicans now. But, if I'm on the Republican side, that's not compelling. I'll just wait out the electoral process and take what I want when I win big majorities in the House and Senate (and win the Presidency). Or, so the Republicans think. There's no reason for them not to be optimistic. When it comes to what we want, we are all able to convince ourselves that the future will be especially good for us. We don't care about what happened in the past. We're terribly biased in our own favor when thinking about what might happen in the future.
Thaler suggests that the Republicans ought to give President Obama a chance, for at least a year, to appoint the people he wants in key posts. Otherwise, Thaler says, when the Republicans win the elections they'll have to deal with nothing but Democratic holds on all of their proposed judicial and agency appointments. Schelling really believes that threats of mutually assured destruction in the future will be sufficient to get both sides to behave reasonably in the present. I'm not so sure. Wouldn't it be better to come up with a proposal that doesn't require either side to make concessions in the present and doesn't hinge on threats about the future? Non-zero sum thinking offers such an option.
Thus, President Obama is still hoping that he can get the Republicans to buy a grand bargain. This would allow them to meet their stated interests (i.e. reduce the federal budget deficit dramatically over the next decade, scale-back government support for Social Security and other "social welfare" programs, allow the states to assume more responsibility for a wide range of governmental activities, and implement tax reforms that reduce the burden on wealthy individuals and corporations in the hope that this will spur job creation). In return, the President hopes to be able to achieve a number of his (Party's) stated interests (i.e. increase short-term public investment in infrastructure and job creation, protect the poorest of the poor and implement reforms in social welfare programs that will put them on a sound, long-term financial footing; implement the next phase of universal health insurance and reforms in health care that will bring costs under control, reduce defense spending and end the war in Afghanistan, and impose regulations, and consumer protection guidelines, that will avoid another financial meltdown). It is actually quite possible to do both sets of things. It will take enormous pressure, of course, from voters on both parties to get their legislators to see that they can achieve their most important interests now while the other side achieves its most important objectives as well.
The media are focused only on keeping score. Who's winning? Everything is framed in zero-sum terms, as if that is the only possibility. Framing everything as a battle allows them to grab eyeballs and sell advertising. If they ever had an educative objective -- to let people know what's happening so they can make choices for themselves -- they've long since abandoned it. Now they are in a fight for their economic survival. In that context, increased partisanship and the reframing of every issue as an ideological battle seems the only way to go.
Shifting the public discourse to a non-zero sum format is going to require a grass-roots effort. The shift will have to be the story, or we won't get any media help. Lots of people, in every walk of life, will have to put forward ideas about mutually advantageous "deals" or "packages" that they, and people like them, can and will support. Imagine an avalanche of letters to the editor, calls to talk shows, and on-line commentary that doesn't require taking sides or ridiculing the beliefs of others? Instead, those interested in what's happening in their lives would offer hundreds of ingenious proposals demonstrating (1) they understand and can restate the interests of both sides; (2) they accept the legitimacy of both points of view even if they favor one side; (3) they are smart enough to think of deals that are better for both sides then what we are likely to get if increasing partisanship and zero-sum thinking continue to dominate. Instead of calling for bi-partisanship or less political sniping, they would fill the airwaves and the internet with proposals that would do a pretty good job of meeting interests on all sides.
I'd also like to see philanthropic organizations offer huge rewards or prizes for political proposals that lead to the passage or adoption of mutually advantageous ways of resolving our current political disagreements. These should exceed powerball payoffs! Let's get the competition going. We've had numerous bipartisan commissions, and they have put forward lots of interesting ideas, but without vocal public support (in the form of pressure on legislators from their own constituents), bipartisan ideas are not enough. Legislators have to hear from their partisan supporters that various proposed deals are "good enough" and probably offer more in the short term (better than what is likely to emerge from endless partisan bickering).
Wouldn't it be amazing, during this year of presidential elections, to see candidates advocating for mutually beneficial policies? Imagine both Republicans and Democrats arguing for ways of meeting their constituents concerns by also meeting interests on the other side. Again, this wouldn't involve comprise. No spirit of bipartisanship would have to overtake everyone. What I'm suggesting is that Schelling's idea of using threats to "win" in the short-term by promising mutually assured destruction in the long-term if the other side doesn't cooperate, is the wrong way to go. Let's use our ingenuity, and construct surprising packages that help all sides meet their most important interests while meeting the interests on the other side as well.