The Finer Points of Negotiation

No, but seriously, folks. It’s not one of the finer points. It’s the central point. It’s the fundamental, Rule Number One of How to Negotiate. (If, as one assumes would be the case, your intent is to negotiate as strong a deal for your side as you can possibly get.) It’s simply this: when you draw a line in the sand, you’re not supposed to erase the line and re-draw it in your negotiating partner’s favor. Because once you do that (and this should be obvious), you can never draw a line in the sand again, and be taken seriously.

The rest of this post will just be other people saying what I’ve said above, over and over and over. That’s what I’m in the mood to do right now: quote as many people as I can find to make this a,b,c point of deal-making, because if the POTUS does not understand it, at least *I* will feel a bit better.

First, Paul Krugman:

Anyone looking at these negotiations, especially given Obama’s previous behavior, can’t help but reach one main conclusion: whenever the president says that there’s an issue on which he absolutely, positively won’t give ground, you can count on him, you know, giving way — and soon, too. The idea that you should only make promises and threats you intend to make good on doesn’t seem to be one that this particular president can grasp.

And that means that Republicans will go right from this negotiation into the debt ceiling in the firm belief that Obama can be rolled.

At that point he can redeem himself by holding firm — but because the Republicans don’t think he will, they will play tough, almost surely forcing him to actually hit the ceiling with all the costs that entails. And look, if I were a Republican I would also be betting that he’ll cave.

And Paul Krugman again:

Meanwhile, in 2011 Obama was willing to raise the Medicare age, in 2012 to cut Social Security benefits; but luckily the extremists of the right scuttled both deals. There are no cuts in benefits in this deal.

But, as Krugman makes clear, only because, even with the Medicare and Social Security spending cuts that Pres. Obama swore he would never, ever, ever, make or agree to, the bill was not extreme enough for the right-wing extremists in the GOP. Or, in other words, thank you, Tea Party lunatics, for rejecting these spending cuts — if you had not rejected them, chained CPI and age 67 for Medicare benefits would have been Obama’s victory achievement.

Yesterday, before the deal was finalized, Timothy Noah pleaded with Democrats in Congress not to go through with it:

Dear House and Senate Democrats,

Your president has sold you out. A deal will likely be announced today canceling the scheduled income-tax increase on all family income below $450,000, instead of the promised $250,000 threshold, which was already too high. It will also extend unemployment benefits and what my colleague Jon Cohn calls the “refundables,” i.e., tax credits for lower- and middle-income people, and it will cancel Milkageddon, which is all good. But it isn’t clear what it will do about the automatic cuts in the “sequester,” and the deal doesn’t appear to include extension of the payroll tax cut, which even Bill Kristol wants to extend. Also, the Democrats mostly caved on letting the inheritance tax rise. Oh, and the deal gives Republicans carte blanche to take America hostage all over again in a month or two over raising the debt limit.

Please vote against this bad deal so we can greet the new year on the far side of the fiscal cliff, which, notwithstanding the hysteria that the Washington Post is doing its best to spread (with an assist from the Senate chaplain!), is not the Slough of Despond. It is the Promised Land, a place where Democrats will have considerably more leverage than they have today to compel a quick deal far more to their liking.

The White House means well, but it has bargained incompetently. As Jonathan Chait points out, any worry on the White House’s part that it will be undercut by Senate Democrats too eager to make an even-worse deal is matched by a well-founded fear on the Senate Democrats’ part that the White House won’t hang tough. And anyway, the president has veto power, for crying out loud! Ezra Klein reports that the Democrats think they can make a deal now, force another tax increase later, and still get Republicans to back down on the debt ceiling. This is delusional. Any Republican who at this point believes Democrats will drive a hard bargain must be judged a fool.

This article by Noam Scheiber is also linked from the first Paul Krugman piece I quoted, above, but what he has to say is worth quoting here, and at length (emphasis is mine):

I think the president made a huge mistake by negotiating over what he’d previously said was non-negotiable (namely, the expiration of the Bush tax cuts on income over $250,000). Then the White House compounded that mistake by sending Biden to “close” the deal when Harry Reid appeared to give up on it. As a practical matter, this signaled to Republicans that the White House wouldn’t walk away from the bargaining table, allowing the GOP to keep extracting concessions into the absolute final hours before the deadline.
My far bigger gripe with the whole fiscal-cliff exercise has always been the strategic dimension—how it affects the next showdown with the GOP, and the one after that. Coming into the negotiation, Obama had two big problems: First, no matter how tough he talked, Republicans always assumed he’d blink in the end, for the simple reason that he pretty much always had. (This is one of the major themes of my book about his first term.) Second, despite the results of the most recent election, in which Obama won a fairly commanding victory on a platform of raising taxes on wealthy people, the GOP continued to believe that public opinion was mostly on its side. House Republicans cited the preservation of their majority—never mind that their own candidates received fewer total votes than House Democratic candidates—and polls showing most Americans still think government is too big.

Fortunately, the fiscal cliff offered Obama a chance to solve both these problems. He could afford to be unyielding because the economic consequences of going over the cliff for a few days or weeks would be relatively minimal and almost entirely reversible. And doing so would immediately demonstrate to the GOP that public opinion was emphatically not on its side—polls showed that the public reaction to going over the cliff would be both intense and heavily trained on Republicans. Throw in Obama’s post-election bump in approval ratings, and there was never a better time to hold out.

Instead, the emerging deal will reinforce the convictions that have made the GOP such a toxic presence in Washington. If Obama will cave even when he’s got all the leverage, when won’t he cave? Never, the Republicans will assume. If Obama’s too scared to stop bargaining and let the public decide who’s right in this instance, when the polls appear to back him, then he must think our position is more popular than he lets on. Suffice it to say, these are not sentiments you want at the front of Republicans’ mind as they prepare to shake him down over the debt limit in another two months. The White House continues to maintain that it simply won’t negotiate over the limit. After this deal, why would any Republican ever believe this? I certainly don’t, and I desperately want to.

Partly in the interest of fairness — but more because I really need to hear an intelligently written “things are not as bad as you think” argument right now — I give you David Atkins at Hullabaloo:

On the specifics of the deal, it’s very easy for armchair bloggers like me to say that Democrats should simply go over the cliff. But it’s much harder to look into the eyes of two million long-term unemployed people and tell them they’re going to lose their lifeline because helping them was less important than holding the line on tax rates above $250,000 instead of $450,000. Absent grander negotiating principles and taking into account the fact that any deal must pass through a Republican House, trading those revenues for unemployment extensions and other progressive moves is probably a good deal.

On the long-term consequences, it’s true that the President’s inability to stick to a negotiating position may embolden Republicans to take future hostages. But it’s also entirely unclear that Republicans wouldn’t be emboldened, anyway.

There is no reason to believe that the Republicans wouldn’t do everything in their power to hold the debt ceiling hostage no matter how strongly Obama and Reid had negotiated on the fiscal cliff. If the President takes the Constitutional option to avoid hostage-taking over the debt ceiling, there’s no reason to believe that the Republicans wouldn’t portray him as a dictatorial King George spending hard-working Americans out of their sustenance, justifying their efforts to take even more hostages in the near future out of formerly mundane government functions.

If Republicans fail to secure a yes vote on the current deal and we remain over the cliff, there is no reason whatsoever to believe that they would ever be intimidated into passing the middle-class tax cut. There is every reason, by contrast, to believe that the GOP majority would refuse to enact said tax cuts unless they got the tax cuts for the rich as well. They would then blame any negative economic impacts on the President and his Party, revel in the utter failure of the government to do its job at even a minimal level, accuse Democrats of passing the largest tax increases in history, and count on an angry public to kick tax-and-spend Democrats out of power in 2014. There is similarly little reason to believe that any similar negotiation over sequestration or any other major issue would not follow the same pattern.

This is the same Republican House that voted down John Boehner’s already extremist “Plan B” because they deemed it to be too liberal. That vote was undertaken not as a negotiating position, but as a statement of real principle. As for the current deal, conservative media figures are mostly furious over it. The only reason it may pass is that many GOP members will vote for the Senate deal today instead of yesterday so that they can go home and triumphantly brag to their constituents about cutting taxes on the heroic job creators making $250K to $450K per year.

Similarly misguided are arguments that the President should simply take the case to the American public to scare the Republicans. The vast majority of the Republican Party is incapable of being scared by public opinion.
Obama is often said to be the worst poker player in history, consistently bluffing then folding. But the problem with that analogy is that Republican House members aren’t playing with their own chips: they’re playing with the country’s. The Republican electoral chips are stashed safely in gerrymandered hands, and any losses over fiscal cliffs or debt ceilings only hurt the President and the nation’s perception of government. There’s no downside for the GOP in bluffing every time in the hopes that the President will fold. Why not? When you’re playing with house money, it makes sense to go all in on every hand.

None of this is to say that the President shouldn’t be a tougher and more progressive negotiator. He should be.

But no one should delude themselves into believing that if he were, the Republicans would be intimidated and stand down. Quite the contrary. We are in uncharted waters, an era unprecedented since the Civil War in which one side is willing to let the country burn down in order to achieve its goals.

Update (by SH):

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Kathy Kattenburg

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  • Let me disagree.

    If both sides come to the negotiating table with their demands set in stone, lines drawn in the sand never to be crossed, then nothing happens. The two sides set out their demands and then, perhaps, call each other names. End of negotiation.

    This is what the Republicans, by and large, have been doing. And this is why the Republicans are largely at fault for messing things up. You can’t run a government by drawing lines in the sand. There always will be differences of opinion on how to run the country, and they must be negotiated.

    There is quite another style to negotiation, laid out very nicely some long time ago in the book Getting to Yes, by Roger Fischer and William Ury. One searches for common ground and works from there. Common ground – yes, that has to do with governing.

    However, as David Atkins noted,

    We are in uncharted waters, an era unprecedented since the Civil War in which one side is willing to let the country burn down in order to achieve its goals.

    How does one negotiate with suicide bombers?

    That is a lot more difficult. I think that one of the things I would do is to try to split them, and I think I have seen some attempts in Obama’s tactics. But they don’t seem susceptible to splitting. When you have One Big Idea that all must bow down and accept your party’s NO, that seems to be pretty unifying.

    I may go back to Getting to Yes to see if it addresses this problem. But I doubt that intrasigence on the Democrats’ part is the answer.

    • You’re assuming that *everything* has to be a line in the sand. But no one ever said that. And some things ARE non-negotiable — or at least should be. Setting out from the start what is non-negotiable saves time and keeps you from giving away the store and all its inventory. At the very least, if you really believe that everything is negotiable, then don’t say it is not and then give it away. It destroys credibility.

      Also, I don’t agree that “you can’t negotiate with terrorists.” Terrorism is a fighting tactic, just like dropping bombs from airplanes is. As morally abhorrent as terrorism is, the people and groups that do it are no different from anyone else. They simply have decided that terrorist attacks and guerrilla tactics are their best options for winning. Historically, lots of groups have used terrorism in service of a political goal that few people (Americans at least) would think of as terrorists.

      • You should know from the start what is non-negotiable. Setting it out ends the negotiation or hands the other side a stick to beat you with.

        I didn’t say “you can’t negotiate with terrorists.” I asked how one negotiates with suicide bombers. That’s an alternative statement of something I’ve been thinking about in several venues, most obviously the one we saw yesterday. I’m truly wondering how one negotiates with someone whose only response is NO, and who is willing to destroy the country to continue that NO. It’s not even clear to me that that response is in their own best interests or that they believe it is. All that seems to be covered in my metaphor of suicide bomber.

        So Obama, with Biden’s help, split the Republicans on this vote. I’m not sure how long that will last or if it improves things. He also got Republicans (some; this is part of the split) to vote for a tax increase and an extension of unemployment benefits. Will they be primaried? Will the Republicans don the debt ceiling suicide vest? I suspect John Boehner is feeling very lonely this morning. And what will happen to Mitch McConnell for working with Biden to get this thing done?

        • The better question to ask seems to be the somewhat more generalized one: “How does one negotiate with single issue extremists?” (Suicide bombers are generally a particularly challenging subset of this category.) Once one further abstracts that to negotiating with a coalition of single issue extremists, more strategic levers become obvious.

  • Actually drawing sequential lines in the sand is frequently an excellent negotiating tactic. Decide what you can live with, then draw the line much further towards your negotiating partner’s end of the table, erase and re-draw extracting other benefits on each episode. He/she spends blood and treasure “buying” nothing but space that he/she has convinced themselves has value, based purely on where you originally placed the line.

  • What you’re describing as “drawing sequential lines in the sand,” Dave, is pretty much normal negotiating tactics, with the flourish of “line in the sand” giving the negotiating partner the high of thinking he/she has won something special, a good way to sucker them.

    In your other comment, you’re bringing up a couple of separate issues, as I see it. One is generalizing negotiating tactics and the other is negotiating with a group.

    Every negotiation is different, so it’s hard to make generalizations. It’s really important to understand the specifics of the other side, which is where I’m sure Joe Biden helped a lot. Every participant has particular strengths and weaknesses, and those are what you must work with.

    Politico and National Journal have excellent discussions of those specifics. I don’t know those details well enough to make a judgement as to how well Obama and Biden worked the specifics, but I think the outcome is not all bad, and the Repubs themselves backed down from a couple of their lines in the sand: the Hastert Rule and No Increased Taxes for Millionaires.

    Negotiating with an individual (or a couple of individuals) is different from negotiating with a group. It seems to me that an individual or small group has an inherent advantage over a group: it is easier for an individual or small group to maintain a stand, whereas a larger group is more likely to splinter. And the individual can use those specifics I mentioned above to split the group. This is what Obama was able to do, and he so enraged the Repubs that they additionally splintered themselves by refusing to take up the Sandy bill.

    I’m writing more about this, might take a few days to get there. Oh, and I’ve consulted Getting to Yes. They do talk about extreme positions (last chapter before the Conclusions), and it looks to me like Obama is using their suggestions.

    • Exactly. These are entirely customary negotiating tactics – and it’s important to remember that and not be swept away by the purity test lens that tries to make it into a story.

      As to the other issue, we’re thinking along the same lines. The Republican coalition of single issue extremists has been given a free ride for too long. They are all able to have each other’s back on their particular extremist issue separately and sequentially. What needs to happen is we need to force a set of strategic forks where various of the single issues are opposed against each other (as well a cycle attacks more rapidly) and stop giving them a free ride. In this context we’re likely less well served by negotiating theory than we would be by great power realpolitik principles.

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