Thursday, November 11, 2010

Talking to Climate Skeptics

On Wednesday, November 10th, I had an opportunity to speak to a packed room of students and community residents at Harvard College seeking advice on how to talk to climate skeptics. The premise was that students would soon be heading home for Thanksgiving. They were looking for advice on how to talk to family and friends around the holiday table who either don't believe that global warming is happening, or accept the fact that the climate is getting warmer, but attribute relatively recent temperature changes to natural rather than man-made causes. To get things started, we heard from a local radio talk show host who really is a climate skeptic. He made it very clear that he doesn't trust Al Gore, is sure that scientists disagree about almost everything (because that's what science requires), and thinks that anyone who believes that climate change is the result of human activity (rather than cyclical natural phenomena) has been sold a bill of goods.

First, I tried to make clear that seeking to convert "non-believers" is probably a mistake, and is certainly no way to encourage constructive dialogue. Rather, I suggested, the goal of dialogue ought to be to share ideas, advance the cause of mutual understanding, and see what opportunities to reach agreement might exist -- in spite of fundamental differences in beliefs or levels of understanding. A number of the students present found this unacceptable. From their standpoint, the threat posed by the continued build-up of greenhouse gases in the atmosphere is so frightening, they are compelled to convince anyone who doesn't believe this to admit that they are wrong. These want to repeat and review what the vast majority of atmospheric scientists know to be true -- the atmosphere is warming; this is caused by the build up of greenhouse gases, particularly CO2 and methane; this build up is caused by human activity, particularly the burning of fossil fuels; and the end result will be a worldwide catastrophy -- sea level rise that will inundate vast coastal areas, particularly in the developing world; increasing storm intensification the will cause destructive flooding and Katrina-like devastation;increased drought in some areas and increasing numbers of extremely hot days that may cause massive eco-migration; more rapid spread of airborne disease, and irreversible harm to a range of marine and terrestrial species and habitats. The skeptic on the dais with me indicated that scientist can't possibly know exactly when and where such things will and won't happen (and he's right). He also insisted that even if warming is occurring, it is impossible to know for sure whether it is mostly or entirely a man-made or nothing more than a natural phenomenon.

That was my cue. I said I didn't think that mattered. I urged people interested in engaging in useful conversation with skeptics to shift their conversations to a discussion of risk -- to talk about risk and risk management. I used the example of earthquakes. We don't need to know for sure whether (where and when) an earthquake will occur to seriously consider taking action to minimize its serious adverse effects an earthquake would cause if it does occur. It turns out, we can require construction standards in new buildings that will protect people from collapsing structures. We can even retrofit existing buildings to make them more earthquake proof (although this comes at a cost). While there doesn't seem to be anything we can do to reduce the odds of an earthquake occurring, there are lots of things we can do (including organizing and practicing emergency relief efforts) to save lives and reduce misery and reconstruction costs when earthquakes do occur. Even if the majority of scientists are right -- that if we don't reduce to 350 - 450 parts per million of CO2 equivalents in the next fifty years the worst effects of global warming will be impossible to correct, we won't be able to reduce greenhouse gas emissions enough over the next three decades to mitigate the effects of global warming. So, given the chance that the many thousands of scientists around the world who study these issue might be right, we could look for things to do that will reduce the disastrous effects if climate change is, in fact, occurring. And, if we could find things that also serve to achieve other laudable objectives (that help almost everyone), why would anyone be opposed to that?

So, I suggested reframing the discussion around what is called adaptation. If we can switch to energy sources that don't involve the burning of fossil fuels, but instead rely on infinite energy sources like sunlight, wind, ocean waves, biofuels and the flow of fresh water, we may be able to simultaneously reduce the adverse effects of climate change (if it does occur), decrease our country's dependence on imported oil and gas, dramatically reduce the health dangers to human beings, minimize the ecological damage caused by air and water pollution and the degradation of surface lands, and create more jobs in our own country. This would be a "no-regrets" response to the possibility of climate change. Similarly, if we can help every household reduce the amount of electricity it wastes (especially at peak times), we can eliminate the need to build new power plants, thereby reducing everybody's electricity rates and saving all consumers money. Even if the risks are not fully predictable, a shift to renewable energy (especially if planned in a way that compensates anyone who suffers any losses in the short term as a result of the shift), would be a more desirable way to proceed. If you think about each component of climate change risk, it should be possible to brainstorm adaptive responses that minimize the chances of serious harm to the public and to the environment while simultaneously improving the economy, and enhancing social well-being. That's what you want to ask skeptics to think about. Ask them to join you in various "thought experiments:"

"Whatever you think the chances are that a buildup of greenhouse gases in the atmosphere is causing global temperatures to rise, and that such increases will trigger a host of dangerous and costly consequences, can we brainstorm cost-effective ways to reduce the harm that would occur if the worst happens and achieve a host of other benefits at the same time?"

Improved emergency preparedness in cities will help if flooding of the sort that occurred in New Orleans happens more often. (Increased storm intensity is one of the presumed effects of climate change.) It will also help cities whether any kind of natural or man-made emergency. Almost every city could do more at a modest cost to update and practice its emergency response procedures.

Investments in expensive transportation, wastewater treatment and other municipal infrastructure should probably be made greater consideration for the possibility of sea level rise, saltwater intrusion into fresh water marshes, and increased storm intensity. It would be crazy to be in a position of having to pay off infrastructure bonds long after a facility is no longer useable because we didn't think twice about climate change risks. Instead, by factoring the risks associated with climate change into infrastructure planning, safer locations or new designs for new facilities might be selected.

As we think about the possibility of a lot more hot days (over 95 degrees farenheit) every summer, what improvements might we make in public and elderly housing that would help people without air conditioning survive? It should be possible to design or retrofit public housing units and to add trees and plantings to keep these units cooler. It should also possible to designate public cooling centers along with ways of helping the disabled get to these locations during a heat wave. Many lives could be saved. These are things worth figuring out regardless of whether anyone is sure that the increase in the number of hot summer days over the past decade was caused by climate change. People died in Chicago two summers ago because of what is now called "the heat island effect."

When you getting into brainstorming sessions with skeptics, avoid asking yes or no questions. Instead ask "when, where and how" questions. How could we reduce certain risks while accomplishing other worthwhile goals? When we have the information in hand, and the public dialogue that follows could look at the full range of costs and benefits (and I don't just mean in dollar terms) what kinds of choices might be made? People with very different views about what climate change science allows us to know might still agree on useful steps to take to reduce the risks associated with climate change because these same activities would help them achieve other things they see as important.

Don't personalize these discussions. Focus on outcomes that would respect everyone's principles. Talk to people you disagree with in the same way you would like to have them talk to you.

Don't paint people into corners by saying something like: "Since science knows Fact A to be true, then you must agree that everyone ought to take Action 1." That will just provoke a counter-attack arguing that there must be someone (somewhere on the web) who disagrees wit Fact A. Moreover, everyone who agrees that Fact A is true will not agree that only Action 1 is the logical thing to do. Instead, ask "Forget for a moment whether Fact A is true or not. What are things that people who don't necessarily agree about Fact A would suggest are worth doing for a variety of reasons?

Friday, August 20, 2010

Overcoming the Not-In-My-Backyard (NIMBY) Syndrome

National Public Radio featured a story this week about growing opposition to renewable energy facilities, particularly wind power. Wind advocates were asked how they might overcome such local opposition -- dubbed the NIMBY syndrome -- in the future. The spokesperson said, "We've got to get in there earlier and educate people." Wrong! How arrogant! You think people are opposed because they don't understand? No, they're opposed because the "costs" and "impacts" ON THEM are likely to outweigh the likely benefits TO THEM. The only way to overcome the NIMBY syndrome, regardless of the type of facility, is to make sure that the overwhelming majority of people in the area believe that the benefits TO THEM if the facility is built will outweigh the costs and impacts THEY are likely to experience.

Why is this so hard to understand? Facility siting scholarship has been clear about this for almost thirty years. (See O'Hare, Bacow and Sanderson, Facility Siting and Public Opposition, Wiley, 1983.) More than twenty years ago, we figured out how to overcome the NIMBY Syndrome and crafted what we called The Facility Siting Credo (Lawrence Susskind, Negotiation Journal, Volume VI, Issue 4, October 1990, pp. 309-314) ). The Credo was tested nationally against the siting experience in a great many American cities (Howard Kunreuther, Kevin Fitzgerald, and Thomas Aarts, Risk Analysis, Volume 13, Number 3, 1993, pp. 301-318)

Every siting effort starts with a small percentage of people who favor whatever is being proposed, probably less than 10%. These are usually people likely to gain personally if the facility is built, maybe by selling their land directly to the facility developer). And, as Mike Elliott, a Professor at Georgia Tech demonstrated many years ago, an equally small percentage of people usually start out opposed. Typically, these are people likely to bear disproportionate costs -- because they live right next to whatever is being proposed. While there are some people in every community who pay no attention to anything (maybe 10%), the vast majority -- 60% - 65% -- fall into a category called "Guardians." It's what that this middle group does that leads to most facility siting controversies.

We know two things about Guardians (thanks to Professor Elliott). First, if they think a licensing or permitting decision is unfair, they will side with the opponents. And, second, they want to hear whatever the arguments are for and against a proposed facility "on their merits." If believable information isn't presented in an open forum where questions can be asked of experts and proponents in a problem-solving format, they will side with the opponents. NIMBYism occurs when these two facts about Guardians are ignored.

Let me get back to the wind energy spokesperson on NPR. If proponents put out one-sided information to help "sell" citizens on the need for new renewable energy facilities, or try to convince them that there won't be any adverse impacts, that's sure to backfire. The Facility Siting Credo indicates how to avoid these and other mistakes, but I'm just going to emphasize the three most important principles in the Credo (and that are, for the most part, ignored in most facility siting disputes in the United States because proponents are typically way overconfident).

1. Engage in joint fact finding, not one-sided "educational" efforts.

2. Let all the key stakeholders choose a mediator to help manage a consensus building process.

3. Promise to compensate potential "losers" and hold any adversely affected neighborhood harmless.

Most environmental impact assessments are prepared AFTER proponents have committed to build a facility. So, whatever data or forecasts are generated tend to be discounted by opponents as nothing but propaganda on behalf of decisions that have already been made. This is exactly the kind of thing that causes Guardians to side with the opponents. The Cape Wind Project in Massachusetts (the first off-shore wind farm in the United States) has been caught up in what must be the most elaborate regulatory review process in energy facility siting history in the United States. Whatever evidence has been presented by proponents has been countered by opponents. Everyone had made up their minds long before studies of the likely impacts of the facility became available. By the time the formal regulatory reviews took place, it was impossible to get all the parties in the same room for a civil conversation. Maine, however, has taken a different tack. The state has pre-reviewed all possible off-shore wind sites and noted publically those that seem to make the most sense in technical, economic and aesthetic terms. We'll see whether private companies proposing to build in one of these pre-designated and pre-reviewed areas faces the same opposition as Cape Wind. Joint fact finding regarding the likely benefits, impacts and costs of a proposed facility tends to be a lot easier if they take place before a specific site has been selected.

Most public involvement in government decisions in the United States is a joke. Hearings and so-called town meetings offer trivial opportunities for opponents and proponents to make short statements that won't convince anyone of anything. They are all for show. The real battle takes place in the media and behind the scenes as each group does its best to lobby the elected and appointed officials involved.

Only an extended public dialogue, when questions can still be asked and answered before the Guardians have taken sides, is likely to lead to believable analyses of the merits and demerits of each proposed technology, location, design, or mitigation strategy). We know how to do this, but it requires that some of the money that will inevitably be spent on lawyers and litigation be used to pay professional mediators to facilitate authentic problem-solving or consensus building efforts. This is not about public relations (which is what the wind spokesperson meant by "education"). Rather, it's about public learning through joint inquiry facilitated by a professional neutral. Most people don't even realize that such a thing is possible! Not everyone needs to be involved. Mediators know how to manage conflict assessments that can bring the right stakeholders to the table, to work on a jointly crafted agenda, with a range of experts advisors to help them. Such public inquiries can now be made entirely transparent on the web.

Now we get to the third principle at the heart of the Facility Siting Credo. Professor Howard Raiffa and others have written about this extensively. Unless you "hold potential losers harmless" they will oppose anything that is likely to hurt them. If you want to build a new facility in a particular location, there is no question that a small number of people living adjacent to the site will be opposed. Telling them that the "gains" to everyone else outweigh whatever "losses" they might experience -- so they should support the project -- is crazy. It's not rational. And, as Professor O'Hare noted years ago, it is easy for that small number of peole to find each other. And, they have a substantial incentive to try to block the facility. On the other hand, all the potential gainers (who could number in the millions if we are talking about switching from fossil fuels to clean energy) are usually unaware of the rather small gains they are might realize over the long haul. They don't have an incentive to organize themselves.

Iff the gains to the gainers far outweigh the losses to the losers, that's not going to stop the small number of potential losers from trying to block a facility. And, since regulators and public officials don't employ the Facility Siting Credo, they play into the hands of that small group who can easily recruit Guardians by complaining that decisions have been made without them and no one is doing anything to compensate the losers. Instead of 10% opposed, the opposition grows to more than 50%, and public officials have no choice but to fight the project.

Compensation to potential losers is not as tricky as it might seem. Most people haven't thought about the difference between compensation (something good) and a bribe (something bad). Also, compensation doesn't have to take the form of financial payments. A facility developer could promise to remove something that has for a long-time been a problem -- like cleaning up a contaminated site somewhere else in the area if they are allowed to go build their new facility.

A bribe is an illegal payment which people would be embarrassed to have made public. But compensation, awarded based on clear principles that ensure that everyone in the same category is treated equally, is not a bribe. Community benefit agreements (currently being debated in New York City) seek to ensure that everyone in a community will benefit when a new facility of some kind is built. Some of the gains to the gainers (especially proponents who stand to make a profit) are, in effect, taxed (before they go to the gainers) and used to ensure that the small number of opponents who really stand to lose will be made whole. Some gains are also used to compensate neighborhoods or communities who experience real losses so that everyone else in the city or region can benefit. Compensation payments, or compensatory measures to eliminate a problem in the area, ensure that all those who bear disproportionate costs (even small ones) realize some tangible benefit over and above the general benefits that all the gainers will get if a facility is built. Construction jobs, for example, ought to be held for those adversely affected. Property tax abatements (or at least property tax insurance) should be offered to those who live near a new facility. This will hold them harmless against any property value losses caused by the new facility. The key is to ensure that potential losers are fully compensated. This will lead the Guardians to side with the proponents and NIMBYism will melt away.

If there is no way to tax the gainers, and capture some of the benefits to compensate the losers, then the proposed facility is probably a mistake -- its either in the wrong location, using the wrong technology or being proposed at the wrong time.

Now, there are some opponents who just don't care what they are offered or what their neighborhood is offered (and, again, I'm not just talking about money). They oppose a new facility for ideological reasons or because they just don't want things to change. In real life, when the Facility Siting Credo is followed, the folks in this category (ideological opponents) are a very small minority (fewer than 5% of the total population of a community or region). Elected and appointed officials (and courts) who see that every effort has been made to use some gains to compensate losers and make the host community whole (through an open problem-solving conversation managed by a professional mediator) are not likely to block what 95% of the community supports. So, the trick is to get the Guardians to side with the proponents.

Please, no more whining about NIMBY. Just adopt the Facility Siting Credo and run the process the right way.

Friday, July 30, 2010

Helping Decentralized Organizations Negotiate More Effectively

Suppose you represent a geographically disbursed organization with units, centers or key individuals spread out all over the world or across a large region. Think in terms of multinational corporations with offices in five or six countries; or, the US military with outposts in every corner of Afghanistan; or, an international environmental NGO with branches in various parts of the globe. For these organizations to be able to negotiate effectively, their people need to be able to put their hands on information in a timely way, get reactions from other parts of the organization to proposals raised during negotiations, and find out all that they can about how the organization has handled similar negotiations in the past.

Networked communication is important to successful negotiation for at least three reasons. First, the experience of one "node" can be of great help to another "node," especially if the lessons learned by one can be quickly and accurately shared with the others. Second, some negotiations undertaken by one node might hinge on the direct involvement of the other nodes. The sales staff in Europe, for example, might be negotiating a contract that it needs the sales staff in Asia to be part of. Or, the soldiers in a northern outpost, negotiating with a group of locals for the first time, may want to hear from other outposts that have negotiated with the same group elsewhere in the country. Finally, the African branch of a global NGO might be meeting with the subsidiary of a multinational that its European counterparts have dealt with before. Effective organizational negotiation depends on being able to tap past experience, build on lessons learned, and keep relevant organizational deadlines, goals and protocols in mind. Third, possible deals often emerge during a negotiation that were not considered beforehand. This means that permissions, or at least reactions, must be sought from other parts of the organization before a final commitment can be made.

Even with the recent cumulation of on-line tools, particularly those offered by social media sites like Facebook, few if any organizations have networked negotiation support systems in place. There are, to be sure, software packages that individual negotiators can use to remind themselves how they should prepare for a negotiation or how to evaluate proposals that emerge during the give-and-take of an ongoing negotiation; but these are intended as instructional devices to help individuals negotiate more effectively. They are not designed to help decentralized organizations pull together everyone and everything that needs to be integrated more effectively.

The MIT-Harvard Public Disputes Program, in conjunction with the Consensus Building Institute and Adroit Productions, LLC, is in the process of formulating design specifications for an on-line negotiation support system to help decentralized organizations shore up their negotiating capabilities. Such a system will have to be really easy to use -- as easy as Facebook. This means that once the system is place, no one will need to do any programming, although user will undoubtedly want to be able to customize the look and feel of their network. The system must be secure. If the military is using it, they must be certain that no one is eavesdropping. So, we are not talking about a traditional web site (but rather something known as a "walled garden"). Networked participants involved with such systems will probably need incentives (and clear instructions) from the top of their organization to require them to keep track of what's going on in important negotiations. And, they'll need uncomplicated, pre-made templates to to their reporting. (Something as simple as thumbs up or thumbs down would be nice.) The results of past negotiations will have to be stored, tagged and easily accessible to multiple users with very different needs. I'm talking about a learning system (not an expert system) that adapts and generates new insights automatically as additional patterns emerge or as users think of new questions they want answered. The same systems will need to support real-time coaching as well as "hot lines" for anyone who needs emergency negotiation advice. Users will probably want quick access to a library of published descriptions of "best practice."

We think it will be relatively easy to build an organizational learning platform that can do all these things. What we need now are a few decentralized organizations ready to pilot test something like this. (N.B. Pilot tests won't be meaningful if top leaders doesn't get behind the idea; and, they'll have to stay with it for a while.) Whichever organizations jump in will have to open themselves up to evaluation and review. That's the only way we'll be able to evaluate how the system is working and figure out how to improve it.

Are you part of a networked organization that wants to improve its organizational (not your individual) negotiating capabilities? What kinds of negotiation information, advice and assistance does your organization need its on-line system to provide? Do you have stories about the obstacles your organization inadvertently puts in the way of its own negotiators? We are eager to hear about additional design specs we should keep in mind.

Is there an organization out there that has already put such a negotiation support system in place?

Thursday, July 8, 2010

Mediation As Problem-Solving

The Organizational for Economic Cooperation and Development (OECD) is trying to hold multinational corporations to appropriately high standards of corporate social responsibility. OECD member states include thirty of the major economies of the world. Ten years ago, they adopted guidelines regarding human rights, environmental protection, the rights of workers and child protection. Now they are in the throes of a ten year review. Every member country has appointed an NCP -- a National Contact Point -- to investigate claims that multinational corporations headquartered in their country, or their subsidiaries wherever they might be located, have violated the guidelines. The NCPs have investigated as best they can (often with very limited staff and budget). The assumption is that being called out by a national government will push multinationals to correct whatever guideline infractions they or their subsidiaries may have committed. Unfortunately, it has been hard for the NCPs to complete many of the needed investigations, particularly those filed by unions or NGOs in far off corners of the world. On some occasions, NCPs have not found sufficient evidence that the guidelines have been violated, but there are clearly circumstances that needed attention. At a recent meeting of all the NCPs and some of their constituent organizations (including their Trade Union Advisory Group, their Business and Industry Advisory Group, and OECDWatch) the NCPs were reminded that their goal should be to rectify inappropriate practices, not just determine whether the guidelines have been violated. More generally, the NCPs were urged to step back from their adjudicatory (or investigatory) efforts and build their problem-solving capabilities. In particular, they were urged to take their mediation mandate seriously.

I am very supportive of a "problem-solving" view of mediation. In too many situations, mediation is viewed as the last step in adjudication (i.e. when impasse has been reached), rather than as the first step in a collaborative effort to head off a problem or work out a creative solution. When a complaint is filed, an NCP must determine whether the charges should be taken seriously. It sometimes does this by asking its national embassy to "make inquiries" about the reputation of the company against whom a complaint has been filed. Then, it might follow up with a call to the company and ask for "its version" of the story. In short, the NCP tries to determine whether the company has, in fact, violated the OECD corporate social responsibility guidelines. They proceed this way because their primary goal is to determine the legitimacy of the claims that are brought. If, however, the NCP's goal were to correct inappropriate practices or implement appropriate remedies, it might, instead, select a qualified mediator -- located in the place where the infraction presumably occurred -- to meet informally with the relevant parties and see what might be worked out. The more informal the interaction, the less likely the parties are to overstate their claims or react defensively. If such problem-solving fails, the NCP can always revert to its investigatory role.

If you were a company accused of violating OECD guidelines, wouldn't you prefer to meet privately with a neutral party (who would keep what you said confidential) than to have to defend yourself in a public way as an official investigation gets underway? From the standpoint of preserving your corporate image, mediation is certainly preferable. If you were a trade union or an environmental NGO concerned about the actions of a company in your area, wouldn't you prefer to have a professional mediator bring everyone together to respond to your concerns than to wait a year or longer while an invisible agency (often in another part of the world) determines whether OECD guidelines have been violated and then writes a report?Adjudication in the absence of enforcement (and that is the situation in globally) won't guarantee change. Mediation leading to voluntary agreements will almost always guarantee compliance with whatever has been worked out.

Mediation as problem-solving requires three things: (1) a willingness on the part of all the relevant stakeholders to work together to resolve the problem or deal with the situation; (2) the availability of a trusted "neutral" with sufficient knowledge and skill to manage difficult conversations; and (3) an agreement on procedural ground rules (i.e., confidentiality, timetable, agenda, good faith effort, etc.). OECD and its NCPs are seriously considering emphasizing problem-solving mediation in the years ahead.

Wednesday, June 2, 2010

Make Compensatory Payments in the Gulf Coast NOW!

We need not wait for a lawsuit or even a federal investigation to start doing something to help the thousands of victims of the oil spill in the Gulf region. The Obama administration should appoint a special master, someone with the same credibility and mediation skill that Ken Feinberg had when he was appointed to administrator the 9-11 Fund. There are many skilled mediators with the experience to oversee the allocation of large compensation funds to thousands of claimants following a court decision regarding corporate liability for an accident or a disaster. In this case, since BP has already indicated that it accepts responsibility for what has happened, it makes no sense to wait.

Once the Oil Spill Master has been appointed, BP should make a payment of at least $2 billion into a Compensation Fund. This could be administered by any one of several large foundations at no or very low cost. Any commercial enterprise that has been adversely affected by the spill (or the failed efforts to clean it up) need only produce a record of what its revenues were during this same period last year and sign a statement indicating that it is unable to operate normally because of the spill, and it would be eligible for immediate aid. The funds would take the form of a non-taxable gift from the foundation. The Special Master and his or her staff would allocate compensation funds to make up for real losses (not emotional distress or punitive damages). Everything allocated over the next six months could be incorporated into whatever the court's final tally is regarding BP's liability and penalties. In the meantime, this would keep the economy of the region alive, protect those at the bottom of the income scale, and allow quick action to protect sensitive environments.

I realize that the Special Master and his or her staff would have to be on the lookout for fraudulent claims, and this would take a little time. But the Special Master could employ private investigators and hold anyone receiving funds criminally liable for any fraudulent claims they might make.

Government agencies could apply to this Fund for money to undertake independent clean-ups of beaches and environmentally sensitive areas along the cost. They might even apply for funds that coastal cities and towns could use to undertake clean-ups. The Special Master would probably need to create a small science advisory committee (calling on university scientists in the region) to quickly review proposed clean-up plans. Since these are not, for the most part, technically complex, the Special Master would only need to determine whether responsible and capable parties had been selected to undertake the clean-ups.

Environmental organizations and industry trade groups might also be allowed to apply to the Fund if they could put together a plan that convinces the Special Master that the money they are requesting will be used to (1) create jobs for those whose livelihoods are immediately threatened by the BP disaster; (2) take short term clean-up actions that will protect fragile environments and threatened species; (3) take short-term actions that will keep the regional economy alive.

By all accounts, BP will eventually owe upwards of $20 billion. So, handing over to a federally-appointed Special Master one-tenth of that amount will hardly affect whatever court battles are to come. The Exxon Valdez penalties (of $6 billion) were ultimately cut in half by higher appeals court. None of that money was allocated for decades after the disaster because of the drawn-out legal appeals process. Those who needed the help the most got nothing in the short term.

Let's not wait for a court decide what BP's liability is. I don't think the company will in any way risk extending its liability by offering to put up $2 billion (less than half of its regular monthly profits) before any court makes a decision about the scope of responsibilities. In fact, a preemptory move of this kind would probably enhance the company's standing in the eyes of the court and in the eyes of the public. The longer we wait to take compensatory action, the more extensive the damage will be.

Sunday, May 30, 2010

Who Will Guarantee the Safety of Off-shore Oil and Gas Facilities?

In 1979, following the accident at Three Mile Island a special commission appointed by President Jimmy Carter recommended that the nuclear power industry take responsibility for setting industry-wide safety standards and ensuring safe operations at all nuclear facilities in the United States. This led to the creation of the Institute for Nuclear Power Operations (INPO), a not-for-profit organization supported by the nuclear industry, but with an accountable board of directors. INPO conducts evaluations of all nuclear power plants every 18 - 24 months. Each evaluation generates a rating of 1 - 5. Any plant with 4 or 5 ratings has a relatively short time to make the necessary safety improvements, or it stands its liability insurance (without which it would have to shut down). INPO trains and accredits the managers of all licensed nuclear facilities in the United States. It undertakes independent evaluations of any "events" and makes sure that its findings are circulated quickly throughout the industry so that the same mistakes are not made again. INPO provides assistance to individual plant operators when they are not sure how to handle particular problems. An adverse INPO finding usually leads to a rapid turnover in corporate leadership. We need something similar, now, to guarantee the safety of off-shore oil and gas exploration and production.

The Nuclear Regulatory Commission oversees licensing. And a variety of other federal and state agencies still have regulatory oversight over various aspects of nuclear power plant operations, but the existence of INPO means three things: (1) the industry, rather than individual companies, are responsible for policing all facilities on a regular basis -- the leaders have an interest in bringing the laggards along; (2) industry operators have no excuses when they are out of compliance -- there is no way to blame regulators who don't understand their problems; and (3) the Boards of Directors of individual companies, when confronted by low INPO ratings, have no choice but to take action if they want to stay in business. While INPO does not publicize its ratings, it is almost impossible for the owners of individual facilities to keep these assessments secret. The top managers of several companies have been swept out in response to low INPO ratings. The system works. There hasn't been another accident since Three Mile Island.

While I might normally argue for a more diversified INPO Board of Directors (i.e. with university or appropriately qualified NGO members), the INPO Board seems to be getting the job done. The Board is made up of the most highly recognized business leaders. They have every incentive to make sure that we never have another off-shore accident again -- their individual reputations and their company reputations are on the line. An INPO-like system for Off-shore Oil and Gas would make sure that appropriated trained people were managing each site, tough safety and risk management standards reflecting best practices were in place, constant surveillance of all facilities was always underway, complete transparency at site was assured, and serious penalties were in place that the whole industry rather than individual operators were obliged to enforce. A new risk management system like this would not infringe on the role of regulatory agencies that must still take the lead in licensing. In my view, the existence of a parallel industry-wide oversight effort would make the regulators' job easier, not harder.

In the current BP disaster, it sounds like federal regulators felt they didn't have the expertise to second-guess the plant operator with regard to when and how to test the safety equipment. Or, in the worst case, the regulators were intimidated by industry leaders or subjected to back-door political pressure from the states that depend on oil and gas revenue. In either case, the creation of an INPO-like organization to oversee the safety of off-shore oil and gas facilities would eliminate the prospect of case-by-case manipulation of standards or delays caused by funding short-falls at the federal level or any kind of political pressure.

Whatever the costs are of setting appropriate safety standards, training (and re-training) all the facility operators, inspecting every facility on an annual basis, and undertaking independent analyses of all accidents or near-accidents, they would be borne by industry. Facility owners would have no choice but to pay attention to the INPO-like rankings they receive every year, and stockholders would demand that their Boards of Directors respond. It is important, of course, that share holders keep their Boards' feet to the fire. Perhaps we need national legislation to ensure that all licensed off-shore facilities have adequate liability insurance. Then, the insurance industry could be put on notice that they must cancel the policies of any facility that doesn't maintain a 4 or 5 rating, or does not raise a low rating quickly enough.

The risk management system in place for off-shore oil and gas facilities is more or less the same as it was when the Santa Barbara oil spill occurred decades ago. Let's not wait for another national commission to investigate the details. Let's create an INPO-type system to guarantee the safety of oil and gas exploration and operations right now.

Thursday, April 8, 2010

Mediating Values-based and Identity-based Disputes

Mediating Values-based and Identity-based Disputes

Lawrence Susskind

The Frank Sander Lecture at the Alternative Dispute Resolution Section Meeting of the American Bar Association (San Francisco, April 8, 2010)

The labor mediators in the room can explain how and why the United States has a dispute resolution system, mandated by law, for resolving collective bargaining disputes. When the public interest is threatened by a strike, the parties can be urged to come to the mediation table. There are other professionals in the room who can explain how and why commercial disputes are mediated or arbitrated – usually because specific contract provisions mandate such action. Today, no one is surprised if a labor dispute or a commercial dispute goes to mediation. The parties and their lawyers know these systems work. And, no one doubts that appropriately trained neutrals will be available– regardless of how many strikes we might have or how many commercial disputes need attention. And, the enforceability of mediated agreements in such cases is well established.

There are other arenas, some less well understood by the public, in which mediation is an option. In small claims courts all across the country, private parties use mediation to resolve tenant-landlord, neighbor-to-neighbor and other two party civil disputes. At the federal and state levels, when new regulations have to be issued, federal and state agencies have the option of initiating negotiated rule-making under the relevant federal and state Administrative Procedure Acts. Professional neutrals, selected by the agency with the regulation-writing responsibility, bring the right parties to the table and assist in generating a draft of the required regulations. Again, appropriately trained neutrals are available to assist. The status of such negotiated agreements – whether in small claims court or in the federal regulatory arena – is circumscribed in law or in the relevant codes.

Why is it we expect these four kinds of dispute resolution processes to “work?” Why are we confident that adding a mediation step will produce beneficial results? Presumably, we wouldn’t advocate mediation if it didn’t generate agreements that satisfy the parties, cost less, take less time, and enhance working relationships . But, why exactly do we think mediation helps? It is not magic. There is a logic to our efforts. I think that logic goes like this: (1) for the most part, disputants know what they want (that is, they know their interests), they have analyzed what is most likely to happen if no agreement is reached; that is, they know their BATNAs, and they want to do better than that; (2) even if they sometimes exaggerate their claims during the give-and-take of negotiation (making demands far in excess of their BATNAs)-- or hiring agents to do that for them -- they are eager to see what can be worked out without extending a strike, proceeding with litigation, waiting for a judge to rule or engaging in a full-blown political battle; (3) after some huffing and puffing they usually discover whether there is a zone of possible agreement (somewhere between their BATNAS or what negotiation analysts call their Reservation Values) and if there is, they can usually craft an agreement and are wiling to be bound by it; (4) the mediator can be counted on to help the parties clarify their interests, explore mutually beneficial trades, generate a written agreement, encourage the parties to be reasonable, and serve as a witness to what has been worked out. The LOGIC of mediation rests on three assumptions: (1) the parties know their interests; (2) when interests are in conflict, ingenious ways can be found to reframe, bundle, fractionate, or otherwise trade bits and pieces of what the parties want to produce workable agreements; and (3) the parties (and/or their lawyers) will be logical, if not reasonable; that is, they won’t turn down agreements that are better for them than no agreement.

The question I want to address today is whether the same logic of mediation applies when we are talking about disputes that involve deeply held values or beliefs (not just interests) and when identities (not just interests) are at stake. For the past several years, with colleagues at the Program on Negotiation at Harvard Law School, I have been trying to answer this question. I want to share with you my findings thus far. (You can read more by googling the Clearinghouse at the Program on Negotiation -- -- and downloading a paper entitled “Teaching About the Mediation of Values-based and Identity-based Disputes.”)

Let me start with three quick illustrations. These are stories based on real cases that have been prepared as role play simulations available through the PON Clearinghouse. They deal with disagreements over incorporating the issue of homosexuality into a public elementary school curriculum; a diversity campaign in a corporate workplace that pressed employees to be respectful of homosexual co-workers; and a dispute over a gay rights celebration in a public park and a city’s efforts to ensure freedom of expression to those who wanted to protest the celebration. These three conflicts provide a useful basis for distinguishing between the usual logic of mediation and a somewhat different logics that I think might be more relevant when values and identity rather than interests are at the heart of public and private disputes.

The three cases I’m about to tell you about were not actually mediated, although I think they could have been. The participants, and especially their lawyers and the judges in the courts in which these cases were filed, did not think mediation could help. If you play the “games” based on these cases, you’ll see otherwise.

The first dispute is between a public school system and two parents over classroom discussion and the distribution of materials depicting same-sex couples. It also explores the role of attorneys representing clients in negotiations involving deeply held values and beliefs. The family wants the school principal to notify them ahead of time whenever homosexuality, same-sex marriage or families headed by same sex couples might be discussed in class. They want their children to be excused from such discussions. The school principal has denied their request.

The family has filed a lawsuit against the school district in state court asserting their parent rights to have their children excused when parts of the curriculum conflict with their religious beliefs. The judge in the state trial court resolved the legal question in favor of the school district, holding that parents do NOT have a right to restrict what a public school may teach their children. The simulation begins at the point at which the family has filed an appeal of the lower court’s decision. Prior to oral argument, the appellate court has urged the parties to try mediation (in the game, that is, not in real life!)

The second dispute focuses on a disagreement between an employee and a large, privately-held software company called MacroB. In this situation, the employee was a senior project manager stationed at the company headquarters in California. A dispute arose when the company launched a diversity campaign featuring a series of posters, including one that read “I’m gay and I work at MacroB.” The posters were placed in highly visible locations in the workplace, including one on the exterior wall of the employee’s cubicle. This person is devoutly religious and from a faith tradition that believes that homosexuality is sinful. In response, the employee posted several Bible versus on the inside wall of their cubicle including quotations condemning homosexuality and predicting dire outcomes for anyone engaging in homosexual acts. When asked by management to remove the Bible versus, the employee refused. The issue moved up the ranks. The employee was given a week off with pay to reconsider. While they were away from the office, MacroB removed the Bible versus. Upon returning, the employee reposted all the Bible passages and refused to remove them. In the game, at the urging of a legal professional known to both sides, the company and the employee agreed to meet with a mediator (again, this is what happens in the simulation, not in real life).

In the third dispute, two private organizations and a city got into a dispute over the speech rights that would or wouldn’t be guaranteed in conjunction with a permit for a festival on city property. A local advocacy organization that supports the city’s sizeable lesbian, gay, bisexual and transgender (LGBT) community has organized a day-long, family-oriented event called the Outfest to celebrate National Coming Out Day and to affirm LGBT identity. In addition to drawing large, supportive crowds, the event attracts members of the public who opposed the message of the Festival and LGBT lifestyles in general. One group called Salvation Now! is a nationwide network of grassroots religious and social campaigners seeking to bring their religious message directly to those they consider to be living sinful lifestyles. Local Salvation Now! organizers were a regular and increasingly visible presence at the annual OutFest. In the past, they have arrived at the OutFest, megaphones at the ready, broadcasting messages that many at the Festival found offensive and hateful. The organizers of the event had readied a human buffer of numerous volunteers prepared to shield the crowd from the protesters. The volunteers carried massive signs to block the signs of the protesters. They blew whistles to drown out the megaphones. As tensions mounted, the police arrested several Salvation Now! members for refusing to follow police instructions and disturbing the peace. Although these criminal charges were eventually dropped, the confrontation damped the festival atmosphere and attracted unfavorable media attention to the city and the Outfest. The following year, fearing escalation as well as legal liability and court challenges, the city requested a meeting with all parties and their lawyers to talk about possible ground rules before they agree to grant a new permit. (At least, that’s what happens in the simulation. There was no effort made to mediate in the real life story.)

Why weren’t these cases actually sent to mediation? Probably because almost everyone involved presumed that no resolution was possible. The fights were about fundamental value questions and presumably neither side would be willing to soften its demands. Feelings of anger, aggression and hurt abounded. Each side assumed they were in the right and that the others had acted inappropriately. The parties in each case felt there was a great deal at stake. Indeed, in several of these disputes, national organizations quickly appeared to offer free legal services up to and including representation “all the way to the Supreme Court.” So, symbolic issues took on great importance.

To the courts involved, and presumably to the parties as well, there did not appear to be any way to resolve these disputes except to let the courts decide which principles would reign supreme: Do parents have the right to tell the public school what it can or can not teach their children? Yes or no? Does a private company have the right to impose a diversity code that forces its employees to refrain from expressing deeply held religious view that might be hurtful to others? Yes or no? Does a city have the authority to impose restrictions on free speech (especially what some consider to be hate speech) in public spaces? Yes or no? And, several of the partisans in these battles didn’t just want to settle these specific cases, they wanted to set highly visible national precedents.

Let me describe the four ways in which I believe mediation might have been useful in these cases and in other disputes like them. The logic to which I appeal in each case is what is most important. I think the logics are relevant regardless of the facts of each case. The question for you to consider is whether, as dispute resolution professionals, these alternative logics fit with your sense of your role and your responsibilities.

1. Consider interests and values separately: That is, try to separate a values-based or identity-based dispute into a more traditional interest-based segment and then help the parties deal with that portion of the dispute in the “normal” way. Maybe it will make it possible for them to take on the values-based portion at a later time.

2. Facilitate dialogue and offer opportunities for deeper mutual understanding and relationship building. Instead of aiming to resolve the dispute, help the parties understand and respect the views of their opponents and, most of all, help them avoid demonization. Again, maybe this will create a different climate in which something approaching more traditional settlement will be possible at a later time.

3. Appeal to overarching values: That is, reframe such disputed by appealing to values that the parties might share rather than focusing on the conflicts that precipitated the dispute. By referencing universal values – for example, equal rights, freedom or non-violence – a mediator may be able to help the parties find common ground. Recognizing common values can open lines of communication, build trust and otherwise improve relations. They may also be a springboard to inventing ways of living and working together more effectively. So, this is an approach to seeking settlement, but it attempts to work around the value differences.

4. Confront value difference directly: Help the parties confront their differences in a controlled fashion and help them explore and question each other’s values with the goal of possibly altering beliefs. Success in implementing this approach will result in at least one of the parties making a change in his or her values and or self-perceptions. There have been occasions, although they are limited in number, when groups with diametrically opposed values and identities have, through the therapeutic effects of truth-telling, cast aside generations of hatred or mistrust and moved into the long slow process of reconciliation. One need only look at all the many divided countries and cultures around the world (like South Africa and Northern Ireland) to see that transformation and reconciliation are possible.

Let me say a bit more about each of these approaches:

Let me use the school case to illustrate why it might be valuable to separate the portions of a dispute concerning interests and values. While the case was making its way through the courts, the children involved became victims. The children of the family that brought the lawsuit became the targets of bullying on the playground and the family was socially ostracized. Might it have been possible to address these aspects of the dispute while allowing the larger policy question to be addressed in some other way? Mediation, in this case, could have been used to resolve a portion of the dispute that dealt with both shared and conflicting interests.

Mediation can be used to try to alter relationships among disputants while not resolving their underlying value dispute. In the workplace case, it is hard to believe that the parties could not find a way of de-escalating the conflict and accommodating opposing views. One of my students suggested, since the underlying disagreement was about corporate pressure to ensure diversity, that the company add still another posters saying something like “I believe in traditional Christian values and I work at MacroB.” The issue of learning how to help employees with radically different social values live together was never addressed in the actual case. Mediation could have offered this possibility.

Reframing a dispute in terms of overarching values the parties might share is a form of resolution, although it requires a restatement of the problem the parties are being asked to solve. In our efforts to imagine what mediation of the Outfest case might have come up with, my students imagined a face-to-face meeting involving the festival organizers, the Salvation Now! leadership -- both their lawyers -- and the city government. My students played out what a mediated discussion aimed at generating jointly agreed upon guidelines that would please both the Outfest organizers and the protestors might look like. In several mock versions of the mediation, we were able to formulate a local ordinance that would increase the odds of accommodating both sides and meeting the city’s concerns.

Mediators aren’t therapists, but it does take a kind of therapeutic engagement to help parties confront others with diametrically opposed and deeply-held values and beliefs. On the other hand, it may be a mistake to assume that values are immutable. People may think they know what they believe in a general way, but there appears to be more room that we first imagined when it comes time figure out how their beliefs will be applied in a specific situation. It may be correct to assume that people engaged in value or identity-based disputes won’t agree to compromise, but other forms of accommodation and reconciliation are still possible. I think that the dispute resolution community has given far too little thought to the logic of reconciliation. When we think about the divided societies that have managed to build workable peace after decades or even generations of bloodshed, we have to be encouraged.

Finally, when I imagine applying the logic of reconciliation to the health care town halls held last summer or the current debates about climate change, immigration or abortion, I see new possibilities. Imagine something along the lines of the Negotiated Rulemaking process we now take for granted. A neutral selected by a joint committee of Congress (perhaps in conjunction with the Executive Branch) would engage in one or more of the mediated approaches I have described this morning. This would take place within a given time frame with the help of a team of mediators. It might be televised or streamed live on the web. This could happen at the national level or at state or local levels. The mediation would seek to achieve one or more of the four outcomes I have described: (1) separate interests and values and try to generate agreement on the interest-based portion of the dispute; (2) facilitate dialogue in the hope of achieving deeper mutual understanding and productive working relationships, (3) appeal to overarching values and find some accommodation; and 4) confront value differences directly and seek reconciliation. The results in each case might not look or feel like a more traditional settlement. However, in the way that the results of a negotiated rulemaking constitute a proposal that the agency with the relevant statutory authority can use as a basis for the rule it must formally issue, a little progress on values-based and identity-based disputes may be all we should hope to achieve.

Imagine that prior to Congressional deliberations on legislation, or prior to issuing executive orders, a mediated negotiation were to take place. A preliminary conflict assessment would be required to bring a manageable number of appropriate stakeholder group representatives to the table. The kind of deliberative poll that Jim Fishkin at Stanford advocates might be used to bind these ad hoc representatives to the views of their constituencies, at least at the outset. I firmly believe that these views are malleable, especially in response to an organized effort to promote reconciliation.


1. Mediation can, in fact, be helpful when parties are engaged in what are primarily values-based or identity-based disputes. I don’t think the usual problem-solving logic of mediation, however, necessarily applies. There are other logics that can, in fact, be helpful.

2. These alternative approaches to mediation need to be institutionalized so people don’t spend all their time worrying about how to proceed. We need legislation to spell out how this might work – a parallel to the National Labor Relations Act or the Negotiated Rulemaking Act. Formal experimentation ought to precede the development of such legislation – just as we did with Negotiated Rulemaking.

3. Mediators may have to learn some new ways of working, and we may have to develop a roster of mediators qualified to take on these types of disputes so the parties don’t waste their time trying to find appropriately-skilled help.

4. Judges will surely need to be educated about these alternative mediation logics. We’ve got to convince the courts that something short of comprehensive and traditional notions of settlement may be the most desirable outcome in certain kinds of value-based and identity-based disputes.

5. It is important that our profession establish a working group to dig into this question and decide what posture it wants to take on the question of mediating values-based and identity-based disputes.

6. Finally, it would help if the research community would document the logics of various dialogue groups that have been working on reconciliation for a long time, like Justice Circles that focus on restitution rather than retribution.

Many thanks for listening. And, my thanks to many of you in the audience whose work on peace-making, reconciliation, and dialogue has given us so much to build on.

NOTE: My attention was drawn to the three cases (on which the role play simulations are based) by Professor Jennifer Gerarda Brown. In a forthcoming article in the Iowa Law Review she argues for mediation in cases that pit gay rights claims against religious liberty claims. You can find her paper here:

Monday, April 5, 2010

Getting Agreement on Energy Policies and Plans

Energy planning ought to be about avoiding problems and seizing collective opportunities. Cities (and nations) have problems when there is not enough energy available at a reasonable price. And, if they could get their act together, cities, regions, states and countries could reduce wasteful patterns of energy use and take advantage of "greener" energy production technologies that reduce costs of all kinds --especially environmental cost -- and increase energy independence (i.e. reducing our dependence on "foreign" oil). Energy planning is about figuring out the best way to match energy supply and energy demand in sustainable ways. It gets complicated, though, because different groups have their own ideas about (1) the desirability of relying on various sources of energy; (2) the desirability of relying primarily on markets to set prices, encourage technology innovation and meet long-term needs, and (3) the appropriateness of allowing some groups and countries to tightly control certain energy supplies. In the final analysis, negotiations at the international, national, state, regional and local levels determine which energy supplies are available and what price we pay to meet our growing demand for electricity, transportation, home heating, and economic production.

Imagine a pie chart that shows the composition of our current energy supplies. We can do this at any scale. Let's think about the country as a whole. Coal, oil, natural gas, nuclear energy, renewables (like solar and wind power), and a few other sources each constitute a wedge. A similar-sized pie chart shows how we use energy: industrial uses, residential uses, transportation, commercial uses, and the like. Supply and demand must be in balance in the sense that we can only use what we are able to find and pay for.

If you ask what the supply and demand pie charts will look like at a certain point in the future, say 10 years from now, there is no correct answer. Different groups will prefer a different mix of energy supplies and want to reshape energy demand, either because a shift will benefit them directly or because they are committed to improving the net overall impact on society in some way. One thing is for sure, though, experts can't tell us what the pie charts ought to look like. We have to make those decisions for ourselves.

If it were up to you, how would you want to alter the pie charts for the United States? The current supply is made up of about 29% coal, 16% oil, 31% natural gas, 12% nuclear, and 11% renewables (including hydro). Current demand includes 30% industrial, 22% residential, 28% transportation, and 19% commercial. The overall price of energy is just over 9 cents per kilowatt, although not everyone pays the same price. The environmental costs of current energy use and production are hard to calculate. Sometimes these are framed in terms of impacts on public health: x people die or get sick each year from diseases associated with pollution of various kinds caused by energy production and utilization. Increasingly environmental costs will be framed in terms of what we would have to spend to artificially do the work that ecosystem do naturally like filter air and water or convert CO2 to oxygen. These are called ecosystem services and we can price them.

Any change in the overall size of the "pie" will effect certain groups -- either changing the price they have to pay for a unit of energy, redistributing job opportunities, reshaping environmental costs, or altering the balance of power in the world. Someone's got to pay for investments in new technology if we want to grow the pie or change the size of a supply or demand wedge.

Efforts at present, at the city level for instance, to change the pattern of energy supply and demand include (1) reducing the amount of energy used by municipal governments; (2) encouraging individual homeowners and businesses to conserve energy and reduce their carbon footprints; (3) encouraging more energy efficient patterns of land use and development, and (4) looking for ways to encourage more sustainable electricity production (through re-use of brownfields for renewable energy, building trash-to-energy plants and the like). In a big city, these can have a noticeable effect. Overall, though, states and national governments will have to get involved or the larger pie charts won't look very different in the future than they do now. In recent years, states have begun to require that at least 20% of the electricity produced within their borders come from renewable energy sources by 2020 or 2030. We'll see whether these provisions are enforced. If they are, the size of the renewable energy wedge could double in the national supply chart.

Unfortunately, we don't have proper forums in which we can work out agreements on how existing supply and demand pie charts should look in the future. Congress has never faced this issue directly; preferring instead to make incremental decisions about whether to subsidize one form of energy development or not (often, at one location at a time). As a nation, we have not set supply or demand goals; instead, we have just bumped along. As I mentioned, states have been trying to encourage investment in cleaner forms of energy production, but they are limited by the grid -- the system of power lines that allows energy produced and stored in one location to be "wheeled" to other locations as demand ebbs and flows. We need a national plan to expand and modernize the grid. We also need to figure out how to store and distribute highly distributed forms of (renewable) energy. We need to decide whether we are going to maintain or increase our reliance on nuclear energy even if we don't have a plan for storing high level nuclear waste.

If states try to change energy efficiency standards or subsidize new forms of energy production, they end up competing with each other. Localities are even more highly constrained. They can improve energy efficiency in public buildings, increase the efficiency of the municipal bus fleet and work with building owners to encourage retrofits that reduce the demand for energy. They can also urge residents to use less energy. But, most are not about to get involved directly in producing energy on their own. If we allow more drilling, maybe we can increase our reliance on oil and gas. But, how do we do that and decrease greenhouse gas emissions at the same time? Can we assume that technology innovation (i.e. clean coal technology or carbon sequestration) will resolve that apparent conflict?

What would it mean to create national, state and local forums in which we could negotiate agreements regarding the changes we want to achieve in the current supply and demand pie charts? At each level, we would have to bring together representatives of all the relevant interests groups, engage in joint fact finding (with the help of appropriately qualified experts), formulate comprehensive agreements regarding five, ten and twenty year objectives and commit to appropriate implementation strategies. These conversations would not be easy. It is hard to formulate overall "packages" that will leave everyone better off. Discussions of this sort need to be mediated by qualified consensus building professionals. At the national level, the Department of Energy could take the lead (in cooperation with the appropriate Congressional committees) but a great many other groups would have to be involved. At the state level, governors and legislative leaders could convene appropriate consensus building efforts, but first we would need to figure out how to define the scope of state energy policies and how they fit within certain national decisions. In every city, broadly-representative working groups would need to consider possible changes in their supply and demand objectives within the framework of state and national plans. Final decisions would be made, of course, by those with the legal authority to make them, but to ensure implementation, the trade-offs and shifting distribution of gains and losses would need to have broad political support.

In the end, energy policies and plans are political choices that ought to reflect the best possible scientific, economic and engineering inputs. Our traditional approach to making public policy -- careening from one crisis to the next -- won't produce the interlocking decisions required. We need to commit to a consensus building approach to energy planning.

Saturday, February 20, 2010

Collaborative Rationality

In their extraordinary new book, Planning With Complexity (Routledge, 2010), Judith Innes and David Booher make the case for a new way of knowing and deciding. They call this new approach collaborative rationality. Instrumental rationality -- the traditional way of making the case for what needs to be done and why in the public arena -- has given way to collaborative approaches to generating and justifying decisions. Innes and Booher point to negotiation theory as the foundation for this approach and use complexity science to explain why it works. They have nicknamed their theory DIAD because it builds on Diversity, Interdependence and Authentic Dialogue. Anyone who works in the public policy arena needs to know what Innes and Booher have to say about collaborative rationality.


Complexity science says that complex adaptive systems need to involve large numbers of individual agents connected through multiple networks. These agents interact dynamically, exchanging information. Even if some agents only interact with a few others, the effects of these connections ripple through the system. As a result, the system has a memory that is not located at a specific point, but is distributed throughout the system. There are many direct and indirect feedback loops; the overall system is open. The behavior of the system is determined by these interactions, not the components; and the behavior of the system can not be understood by looking only at the components. Complex adaptive systems display both the capacity to maintain their viability and the capacity to evolve.

So, Innes and Booher suggest that to make collaborative processes more effective, they should be self-organizing, with diverse agents, involving many interactions and non-linear dynamics. These are the keys to making them creative and adaptive. The inclusion of all agents (i.e. full participation of all relevant stakeholders) is required for coherent and novel patterns of action to emerge. They also argue that "the condition of diversity implies that a collaboratively rational process must include not only agents who have power because they are "deal makers" or "deal breakers," but also those who have needed information or could be affected by outcomes of the process."


The condition of interdependence holds that agents must depend to a significant degree on other agents. That is, as is true in all successful negotiations, each agent (or stakeholder) has something that the others want. This condition ensures that participants maintain a level of interest and energy required to engage each other and push for agreement. Negotiation theory tells us that interdependence among interests is the key to moving past zero sum games to mutual gains agreement. Such interdependence means that players cannot achieve their interests on their own, and that given their diversity some participants will value certain results more than others. As a group, therefore, they can pull together a "package" that allows every participant to get more of what they value without reducing the value that accrues to others.

Authentic Dialogue

Authentic dialogue requires that agents engage with each other in deliberations that adhere to Habermas' ideal speech conditions. That is, deliberations must be characterized by direct engagement so that the parties can test to be sure that claims are accurate, comprehensible, and sincere. Deliberations cannot be dominated by those with power outside the process, and everyone involved must have equal access to all the relevant information and an equal ability to speak and be listened to. (This is what I have described as Joint Fact Finding in previous blog entries.) In authentic dialogue, all participants can challenge the assumptions or assertions put forward by others. Nothing is off the table, and the reasons people give for what they are arguing matter a lot. Authentic dialogue relies on (1) what participants know from their everyday lives and not just on specialized, scientific expertise, and (2) knowledge constructed jointly through interaction and shared inquiry. Many processes that are dubbed "collaboration" fail to meet these conditions, and, thus, do not involve authentic dialogue.

Complexity science explains why collaborative rationality works

Innes and Booher write: "The complexity and rapid change in contemporary society have created an increasing awareness among policy leaders of the limits to hierarchical control by government agencies and to formal expertise in solving problems. This awareness leads to growing uncertainty about policy and a new focus on the need to manage uncertainty, rather than create programs and regulatory regimes that deny its existence. As society has become more culturally diverse, decision makers have to deal with an array of publics with different values, perspectives, cognitive styles and worldviews. Complexity is also reflected in growing interdependence among government players, as agencies find they cannot be successful, even on their own limited agendas if they continue to work unilaterally."

Collaborative rationality sees the world as inherently uncertain and assumes that all decisions are necessarily contingent. "In this view, planning and policy are not about finding the best solution -- indeed there is no one best solution, though there may be many better ways of proceeding than the status quo. Collaboratively rational processes are about engaging with other members of a community to jointly learn and work out how to get better together in the face of conflict, complex changing conditions and multiple conflicting sources of information. Such processes are not only about finding new ways to move forward, but they are ultimately about guiding community and governance capacity to be resilient in the face of the inevitable new challenges."

A resilient system is one that can withstand shocks and surprises, absorb extreme stresses, and maintain its core functions. Resilience (according to Berkes and colleagues, 2003) refers to the amount of change a system can undergo and still retain the same controls on function and structure; the degree to which a system is capable of self-organization; and the ability to build and increase the capacity for learning and adaptation in the system. Thus, sustainability is a dynamic process and not an end product.

Now, every time someone suggests a collaborative (bipartisan?) approach to public policy-making, you can assess their authenticity by applying the elements of the DIAD model. Are they really committed to collaborative rationality, or are they just traditionalists hiding behind the mask of collaboration?

Sunday, January 17, 2010

Dispute Prevention: It's a Good Idea, Right?

I was recently asked to join a panel at the annual meeting of CPR (the international institute for conflict prevention and resolution). ( This is an organization that has worked for more than 30 years to convince law firms and in-house corporate counsel to take dispute resolution seriously. They are the ones who came up with the idea of adding a "dispute resolution clause" to all kinds of contracts so that parties don't resort to litigation at the first sign of disagreement. Our assignment was simple enough -- make the case for dispute prevention, not just appropriate dispute resolution. We were motivated by a simple cartoon showing someone peering down from the top of a very high hill to a waiting ambulance below. The ambulance driver is dash off to the hospital with the latest victim injured in a fall because no one thought to build a fence around the edge of the precipice. We were talking about building a fence to avoid disaster, not just arranging to have an ambulance ready when the inevitable occurs.

It turns out, that in the construction industry, dispute prevention has been the norm for years. With CPR's help (decades ago), that industry learned to initiate "partnering agreements." Companies entering into construction contracts may have to work together for several years to complete a project. Delay at any point during the construction of a large building can kill a project -- time is money! So, at the beginning of a project, the financial sponsor, the architect, the builder and sometimes others (like the construction union) sign an agreement promising to meet regularly (whether there's trouble or not), keep lines of communication open, monitor progress jointly, and put a standing panel of neutrals (i.e. mediators or arbitrators) in place so that small disagreements are addressed and resolved quickly before they escalate. By putting a carefully designed dispute handling "system" in place, it turns out that most disagreements or misunderstandings can actually be avoided. There are unambiguous findings from numerous studies to support this.

Why, then, are dispute prevention measures so rare in other sectors? We speculated that it might be because industry leaders just don't know about the idea of partnering agreements or standing dispute resolution panels (with very quick timetables for airing and resolving disputes). But, that seems unlikely since the same law firms and in-house counsel, trained at the same law schools, work in these other sectors. So, we explored other obstacles or barriers to using these dispute prevention techniques. Our best guess is that law firms (or lawyers in general) might be the problem. What glory is there is being the person responsible for avoiding a dispute? And, how can a legal services provider make any money if they succeed in avoiding most litigation?

I suggested that we ought to add a provision calling for a "dispute prevention bonus" to all legal services contracts. So, in fashioning a business deal, for example, the law firm involved in writing or reviewing the contract would add a provision calling for a financial bonus (set, perhaps, as a percentage of the expected value of the deal or the transaction) to be paid to the lawyers involved IF there is no litigation throughout the life of the contract. Deductions from the total might be made to cover the cost of arbitration if the standing panel needs to use it (but not for rapid-fire mediation). Imagine, all the lawyers working like crazy throughout the life of a project or a contract to be sure that parties stay in close contact, communicate effectively, smooth out their misunderstandings quickly and take the pre-agreed steps to resolve minor disagreements! I have no doubt that lawyers would become skilled in dispute avoidance if they had sufficient incentives to do so.

At the conference, we talked about the four prerequisites for dispute prevention. The first is a written dispute avoidance/dispute handling agreement that spells out appropriate step-by-step procedures. The second is a requirement that the most senior managers on both (or all) sides of a contract or a working relationship must be called in at the first sign of trouble. [This seems to motivate everyone below them to do whatever is necessary to keep things under control.] The third is the inclusion of a standing neutral (or panel of neutrals) so that the parties don't have to scramble to find someone acceptable to everyone -- and who understands their business -- when small problems arise. Finally. an explicit financial disincentive or a dispute prevention bonus may be required to keep everyone motivated.

My own take on this is that "clients" of all kinds must demand that legal service providers emphasize dispute prevention before the idea will spread as rapidly as it should.