Tuesday, September 18, 2012

Politics and negotiation

What are the essential skills politicians need? I think there are three:
  •  Expectation engineering
  •  Commitment engineering
  •  Negotiation
Expectation engineering means to shape people’s expectations: about what will happen if things continue the way they are, what happens when other parties have their way, what happens when your party will have its way, what happens if you get your way. Expectation engineering easily degenerates into general statements that play to hopes and fears of people, unhampered by pertinent knowledge and practical wisdom.
Commitment engineering means to build alliances, to build support, to build a reputation for honesty, fairness and reliability, to stand your ground to the extent it is practically possible.
Negotiation depends on the personal qualities and personal reputation of the negotiators and of the knowledge that they truly represent the views and the interests of their constituencies. And on their ability to judge the position of their opponents, their views, their interests, the pressures they are under. The best negotiators are reasonable and humane, but skeptical and perceptive, with sound judgment. The worst negotiators are missionaries, fanatics and advocates, especially if they are unsure of their own constituencies. This makes new, inexperienced amateurs unreliable. They want to score too badly. The most common vice of negotiators, both experienced and inexperienced is vanity. Vanity breeds indiscretion and tactlessness.
The ideal negotiator is truthful, precise, composed, patient, modest and loyal.

In the Netherlands, we just had an election that forces the two big winners, centre-right and centre-left, to form a coalition government. From day one, the press is lamenting back-room politics, meaning they don’t know exactly what’s going on. But negotiation is essentially a back-room activity. All publicity during the negotiation phase is to influence what is happening in the back-room. Usually, it’s more to satisfy their own constituencies, then to influence the other party, even if it seems that the public utterances are directed to the other party.

The best possible outcome of a negotiation is when each party get gains that don’t cost too much to the other party. And where that is impossible, that compromises are fair - and workable. A lot of expectation engineering is necessary to make the commitment engineering work, both inside and outside the negotiation ‘back-room.’

The essential difficulty is that expectations are necessarily shaky in fields like economics as  the dynamics are so complex and turbulent that the relationship between causes and effects is never clear-cut. Political decisions are a boulevard of broken dreams.
This seems one of the major reasons that politics becomes personalized. The more the destination is controversial, the more all routes to all destinations are insecure, the more trust in the captain is what counts. The media enlarge this, they don’t create this.

Politicians are no supermen and supergirls. Those that present themselves as such, should not be trusted. We should not imagine them to be that. I remember the lead caption of a Brazilian newspaper, right after the end of the military rule, when the country was suffering all the turmoils of a return to democracy: A COUNTRY THAT NEEDS A MESSIAH, DOESN’T DESERVE ONE. Amen to that.


Tuesday, June 26, 2012

Europe and the loss of national sovereignty

In reading about this subject, we have to wade through pools of crocodile tears.
What is the issue? The Netherlands may lose its unbounded right to overspend and build up deficits. Nice right!
It is simple: overspending delays and increases payback. So, if you are old, vote against ‘more Europe.’ If you are young, vote in favor of it.
I am in favor of individual freedom, that is, my personal freedom. I am quite willing to grant others their individual freedom - as long as they don’t impinge on mine. I don’t want people to have the freedom to steal my purse, to enter my house, to trample my garden, to take my books home. In the end, I have more freedom if the larger community restrains some freedoms.
My freedoms are even more restricted. I can’t do with my house what I want. I may grow as many trees in my garden as I want, but I can’t chop them down when I want. So many restrictions. Still, I live pretty free.

I don’t think national sovereignty is at stake by a 3% ceiling on overspending. The European Union consists of what Daniel Boorstin called ‘modern democratic societies where each people asserts its divine right to go to hell in its own particular way.’ (The Image, 1962, preface to the Pelican edition) The right to freely overspend is an aspect of that divine right.
What happens if we don’t accept such restrictions by Brussels? We will become dependent on the vagaries of the financial markets, where money slushes through the system in search of short-term advantages for small participants. That may not be evil, but it certainly is incredibly more volatile and threatening than any ceiling from Brussels.
I see quite an other problem. In the future, any political wish that a government doesn’t want to grant, can be blamed on Brussels. Like parents who can’t satisfy the wishes of their children, blaming it all the time on their bank who limits overspending. The point is, of course, that if you don’t overspend, the bank remains completely uninvolved with how you spend your money.

Of course, there are several other aspects of the trend to further federalization within Europe, like common banking laws and common bonds. We should not fear the loss of national freedoms, but the loss of individual freedoms and individual prosperity.
We also should maintain a free market as far as possible. But people and companies that have benefited from the free market attain positions in which the freedom of their enterprise is used to curtail that of others as much as possible. Free enterprise means freedom for new enterprises, not for established ones. You need a strong state to keep the markets free. An indebted state is not a strong state.
So, please, please, somewhat less national sovereignty please. Financial sovereignty doesn’t mean to lend as you please, but solvability and liquidity. The reigns should only be loosened in case of war, calamity or promising new infrastructures for energy and transport.