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Negotiations 101: Why Don’t Congressional Democrats Do the Obvious?

Posted by Peter M. Shane on February 13, 2010

Having much training in public law and very little in practical politics, I tend to think I must be missing something when people in power do not do what looks like what would obviously be in their interest.  But Democratic behavior in Congress is so counterproductive that I cannot resist pointing out two lessons they would surely pick up in an introductory course on negotiations.

First, if you want someone to negotiate, negotiation has to promise a better result than what professionals call the “best alternative to a negotiated agreement,” or BATNA.  Right now, for Congressional Republicans, the alternative to virtually any health care bill that could possibly pass is the status quo.  Republicans are happy with the status quo (or at least they realize that alternatives they might like better, such as draconian malpractice caps and the privatization of Medicare, won’t happen.)  So, why negotiate?

That’s why Democrats should do two things.  They should say to Republicans, “You want to start over?  Fine.”  But first, the House must adopt the Senate health care reform bill.  That would put in play an actual health care reform plan as the actual, real-live, not just imaginary alternative to negotiation.  Then, Democratic and Republican negotiators should give themselves a three-month deadline to strike a bipartisan deal that starts over from scratch.  If they do, great.  If not, at least the Democrats will have accomplished something.  Most immediately, they will have changed the momentum for negotiations.

Second, as others have observed, Democrats and Republicans in Senate face what game theorists call a “prisoner’s dilemma.”  Imagine police have two suspects they believe committed a crime.  They cannot prove it unless one testifies against the other.  The police say to each, “If you testify, you’ll only serve a year in jail and the other guy will serve ten.  But the deal goes only to the one who caves first.”  Neither prisoner should want to cave; they should cooperate with each other and maximize their joint welfare.  But each knows that, if he alone cooperates with his fellow prisoner, but the other caves in, the non-testifier will be much, much worse off than if he had simply abandoned the other.

I believe the major sourcce of public contempt for Congress — and contempt may not be too strong a word — is that Congress seems incapable of doing ANYTHING.  If Congress appeared to be tackling actual problems with imperfect, but incrementally helpful solutions, incumbents from both parties would find their approval ratings going up.  But maximizing the parties’ joint welfare requires cooperation — the equivalent, in the prisoner’s dilemma, of not ratting out.  But, unless there’s going to be some real promise of give on both sides — some actual bipartisanship — each side may think itself better off by posturing for its base.  (Here, however, one has to note that the Democrats do not seem good even at posturing.)

Game theorists have shown that there is one superior strategy for overcoming the prisoner’s dilemma if you have repeat players.  The strategy is called “tit for tat.”  One side offers cooperation; if the other side cooperates, repeat.  If not, retaliate — and hard.  Then, keep doing this strategy over and over.  The idea, through a series of repeat encounters, is to show that playing nice always produces good outcomes, and not playing nice always produces harm to the non-cooperating party.

What this means for the Democrats is that, as a consistent strategy, (1) they have to offer something that Republicans want as a means to induce cooperation, and (2) they have to have plausible retaliation strategies if cooperation does not happen.

Of these two lessons, the first is a no-brainer.  Unless the Democrats change the GOP’s BATNA, they will not negotiate. 

The second lesson should work, too — unless the Republicans actually do not want anything from the Democrats.  If the Republicans believe that doing nothing is always the superior strategy, then the Democrats have to think relentlessly about what they can accomplish by themselves.  Doing nothing and just blaming the Republicans spells weakness.  With a majority in the House and a 59-member caucus in the Senate, if the Democrats cannot enact legislation, voters are unlikely to give them more seats to work with.

A final note to Congressional Democrats:  The Republicans in Congress seem to have taken the introductory negotiations course — probably also the intermediate course — and gotten A’s.  You need to enroll and aim for a grade better than “Incomplete.”

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