The Naive Negotiator

By Megan McArdle

In a post titled "The Public Option May Not Have Been Winnable", Nate Silver makes the obvious point that there were probably never enough votes to get a public option.  Whatever else you say about Lieberman, he said he didn't want a public option a year ago, as did several other moderates.

His commenters have a quite naive view of how negotiations work, a view that Paul Krugman seems to be echoing in this blog post:  "By all means denounce Obama for his failed bipartisan gestures. By all means criticize the administration. But don't take it out on the tens of millions of Americans who will have health insurance if this bill passes, but will be out of luck -- and, in some cases, dead -- if it doesn't."  I am struggling to remember all these magnanimous bipartisan gestures  from the guy who famously told Republicans "don't do a lot of talking" when they had the temerity to criticize him.  But this is really neither here nor there.  Krugman, and the commenters, seem to imagine that negotiation is a process where you ask for huge concessions, and then bargain your way down to splitting the difference.  So naturally, the reason that liberals have ended up with nothing in the way of a public option is that they were too nice to Republicans and conservative Democrats, and did not start out demanding single payer, and the nationalization of the coal mines.

Negotiation doesn't work that way.  There is a zone of possible agreement (known to those who study this sort of thing as the ZOPA).  You can't negotiate your way out of that zone no matter where you start.  Nor does starting from a more aggressive bargaining point always mean that you will do better in the negotiation. It can often mean you do worse, because you poison the process.

My mother used to sell real estate, and you'd see this a lot with stupid buyers, particularly men using newbie agents:  they'd submit an unrealistically low bid on the notion that this would force the buyer to bargain down.  What it actually did was convince the buyer that it was a waste of time to negotiate with you, and/or make them angry.  The net result was that King Kong got to beat his chest, but he didn't get to buy the apartment he wanted.

This bill is, at this point, hideously unpopular.  I'm pretty sure you've got a bunch of senators who would really, really love not to vote for it.  Ultimately, the moderates had a very good alternative to negotiated agreement, and the progressives didn't, and that was crystal clear from Day 1.  That meant the progressives were never, ever going to get very much.  This was not a failure of political will or political skill.  It was the manifestation of a political reality that has long been obvious to everyone who wasn't living in a fantasy world.  If progressives decide that the lesson from this is that they haven't been sufficiently demanding and intransigent, they are going to find themselves about as popular with the rest of America as the Bush Republicans, and probably lose their party the House next year.

This article available online at:

http://www.theatlantic.com/business/archive/2009/12/the-naive-negotiator/32213/