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Game theory and politics
Posted at: Oct/12/2013 : Posted by: mel
Related Category: Perspectives, Politics & Gov, Watching America,
We’ve all played games. Games have winners, losers and various types of outcomes. Some games are easy to manage and some are about understanding and predicting what your opponent is likely to do. Most games have rules and many games are enhanced when the participants bring special skills and developed strategies to the competition. In some game situations there is even the possibility for all participants to garner at least a partial benefit.
The science of understanding games is called “Game Theory” and was first documented by John Von Neumann (Princeton mathematician). The early emphasis of game theory was on games considered “zero-sum.” Zero-sum games like tick-tac-toe, chess or soccer to name a few require choices and strategy, but ultimately have a defined winner and loser. In tick-tac-toe we all learn very early that if you make the right first move you have already won unless you make a mistake. In games like chess and soccer, the participants use strategies depending on what their opponent is doing. In this form of competition, the participants perform their actions based on their own strategy and as a reaction to their adversary’s actions. The person or team that implements their strategy best and reacts well to their opponent will therefore win the competition.
Games are critically different from decisions made in a neutral environment. Think about the gardener and the general. When the gardener mows the lawn he does not expect the grass to fight back; his environment is therefore neutral. The general plans to use his forces to mow down his opponent. He must anticipate resistance to his plan and make choices continuously to react to and overcome this resistance from the opposing army. These strategic reactions to the intelligent and purposeful people on the other side of the table or field in a dynamic environment are the essence of game theory.
For the general, team coach, defensive lineman or chess player the focus of their effort is to look ahead and reason back what to anticipate next and how to best respond. The best people at this put themselves in the other person’s shoes and think about their available choices and what they are likely to do next, then reason how best to counter these potential actions. This is the interdependence of the player on both sides to their own actions and the outcome of the competition. Obviously, the further and more completely you can look ahead, the more successful your strategy is likely to be.
John Nash (another Princeton mathematician) published a thesis in 1950 that expanded on game theory and is now referred to as the “Nash equilibrium.” In the application of the Nash equilibrium, participants make their decision seeking a benefit while knowing that the opponent is simultaneously making decisions. While it sounds esoteric, the application is beneficial in business, economics and politics as it emphasizes a path or strategy where both participants can benefit and minimize the scope of the overall conflict. A simple example might be the negotiation on a large purchase like a car or home. When the seller lowers their price some and the buyer increases what they are willing to pay, the transaction is completed and both participants get something rather than having one absolute winner and loser, or no transaction at all. This is a mutual gain approach to competition with the special insight that the player or participant most interested in reaching a conclusion first will still get a slice of the pie, but it will be smaller than their opponents.
For many decades the Nash equilibrium of mutual gain has been a driving force behind business and political negotiations. The concept of bargaining is an application of the mutual gain strategy. This is often used when the players know that the cost of a delayed resolution would be excessive as opposed to finding an agreeable medium.
For years we have elected our local Senators and Representatives and sent them to Congress with an agenda to represent their local constituents. With only a few notable exceptions our congressman would argue loudly for their specific agenda, and then negotiate for a mutually beneficial result. The advantage to this approach has been that things got done. Whether a national highway system, an elaborate tax code, or a myriad of social programs…the business of government was to act like a business and keep the doors open. The negative to the mutual gain approach in politics is that it nearly always means spending more money to varying degrees. As a consequence of years of mutual gain during political negotiations, we are now on the threshold of an unsustainable federal budget.
As described by Thomas Schelling in his book “The Strategy of Conflict,” another way to negotiate is with brinkmanship, a tactic of deliberately letting the situation get out of hand. Think of this as creating a risk for the other players if they fail to act as you would prefer. This is similar to the game of chicken seen in old movies. Two hot heads reach a boiling point and commit to racing their cars at each other on a narrow country road. Once the game starts there is no mutual gain outcomes left. If one car at the last moment swerves, his car is wrecked in the ditch and he is forever humiliated. If neither is willing to swerve, they both die in a spectacular crash. If this was merely over a girl, she could ultimately move on, finding another guy and forget the two with egos too big for their own good. If this is about our national budget, it’s not near as easy to move on from the fiery crash.
Representative John Boehner said “This isn’t some damn game,” but that appear to be what they are all doing. The Democrats, Republicans, fringe groups and our President all seem to have their feet mashed down on the pedal and have tossed the steering wheel out the window ensuring a catastrophic outcome. I would love to say this is a first time, but in 2011 we watched the same game unfold in a cloud of smoking tires. Congress set up the threat of a budget sequester for the first time in 1985. With budget negotiations stalled in 2011, the White House proposed a similar sequestration as a presumed means to spur the process forward. The budget cuts were advertised to be so painful and arbitrary that they were considered unthinkable by all parties. Yet, neither the Democrats nor the Republicans were willing to swerve and the sequester budget cuts went into effect. In August-September of 2013 Republicans and Democrats were again hurdling at each other in another game of chicken. As both sides made speeches prognosticating that they would never let the government shut down, they continued to accelerate their cars. And yet the government did shut down.
Now that we are into October 2013, all sides are saying that the threat of a debt default is so unthinkable that they will come to their senses and come to the table. The words sound strangely familiar. Despite all the people who argue that this is not a game, I have begun to think otherwise. President Obama has certainly repeated many times his stance that he will not negotiate on the debt ceiling or healthcare, clearly he has no plans of swerving and is focused on a specific agenda as opposed to being the moderating voice in the midst of chaos. Speaker Boehner in a similar voice emphasized that he can’t come to the table unless you give me a deal here, Mr. President.
In the game of chicken, human factors are a substantial coefficient. Despite being a game, the participants have stopped thinking strategically. Instead, the players are driven by their anger, their sense of spite, their sense of revenge and their ideologically polar agendas. If you’re so angry with the other side that the only thing you care about is making sure that the other person or team is destroyed, the game is no longer strategic and those steering wheels have gone out the window.
I know as a mere spectator that my first thought is “this is crazy.” Yet, when you watch those old movies, the two protagonists ultimately lose all sense of logic and it becomes just a contest of destroying the other person. There is always a spectator in the crowd pleading with them that “this is crazy” to no avail. To a limited extent I am reminded of Herman Melville’s Moby Dick in which Capitan Ahab’s vengeance became all-consuming and eventually destroyed not only him, but those around him.
Theorist would tell you that game theory and game like behavior factor into many aspects of our lives. I suppose that is true, but clearly some games are better to play than others. In the game of chess, even if you must lose, you can do so in a manner that earns the respect of your opponent and no blood is left on the board. Clearly, chicken and a single minded agenda focus is not how to play the game of politics.