A Lesson in How NOT to Negotiate-The “Fiscal Cliff” and Washington

Yes, we are all (most of us) freaked out by what is happening in Washington. We can all improve our negotiating abilities by watching Washington bumble their way toward the fiscal cliff.

I have taught negotiation for years, including to individuals and corporate leaders, at several businesses, and to members of business SWOT (Strengths, Weaknesses, Opportunities, and Threats) teams. I have worked with groups at an impasse that appeared worse than what is happening in Washington. Many ended up with agreements that got more than either side originally wanted. That's not only possible, it is commonplace, provided people avoid four pitfalls.

Pitfall #1: Confuse a negotiation with a debate. In a negotiation, your goal is a settlement that is the best possible for all concerned. The research is overwhelming that if you take care of the other side's interests, in addition to your own, you will get a better deal, and better future deals, than if you just try to beat your opponent. People often ask me to “play out” a great negotiation. When I do, people ask: When do we get to the good parts? Good negotiations make awful television. No "gotchas," no moments of outrage and no sound bite. What you see is a bunch of people having a cordial and constructive working session around a table.

In debates, the goal is to score points with an audience. You don't really care what the other side thinks or feels. In fact, the more wounded they appear, the better for you (as long as you don't push it too far and make your audience think you are a bully). When people who should be negotiating debate instead, they do lots of press conferences and speak in sound bites, often with laughter in the background.

In the case of the "fiscal cliff" talks, each side complains about the other, releases word that people laughed out loud when seeing what the other side offered, and makes its opponent seem crazy and irresponsible. Debates make great television.

If this were a debate, the Democrats would be winning, according to most recent polls -- most Americans would blame the Republicans if the country drives off the cliff. But since it's a negotiation instead, we're all losing. This approach appears to force the Republicans to give up one of their key points, which takes us to the second pitfall.

Pitfall #2: Go into a negotiation with a few elements you must have, or there's no point in even sitting down. Some of the best negotiators I have ever met work in law enforcement, usually as part of SWAT (Special Weapons And Tactics) teams or teams of behavioral scientists supporting SWAT members. Do people really ask for helicopters and safe passage to Mexico, like in the movies? Last time I asked that question, over lunch with a friend who is a police officer, they burst out laughing. "Not really," was their answer.

"But what would you do if someone asked?" "Get through it," they said, and referred to a technique called "click down". You ask why the helicopter is important. The likely answer would be: "to get away, idiot!" Humor me. "How do you see getting away playing out?" "I want to be treated with respect," might be the answer, and an ideal response to that is, "you have our respect, or else we wouldn't be talking." The person is then likely to talk much more reasonably about what happens next. Why? It is because it was never about the helicopter. It was about respect. When they were shown it, the need for the unrealistic demand went away.

Part of the problem here is that many Republicans signed Grover Norquist's "no new taxes" pledge. I wrote a year ago that revoking that agreement was necessary to deal with our financial situation, and should be done with honor.

To be clear, the fact that people signed this pledge is fine -- it's in line with a political and economic philosophy many of us (myself included) agree with. It is a problem because it prevents responding to unforeseen crises. There was a time when many Democrats would have signed a pledge to not enter wars. That also would have been reasonable, given a philosophy many of us (myself included) agree with. And if the world changed, as it has many times in the last 100 years, the pledge would need to be revoked to deal with Pearl Harbor, the rise of the Nazis or if Syria uses chemical weapons on its own people.

With that agreement in place, the next pitfall is almost inevitable.

Pitfall #3: Confuse positions with core values. I encourage leaders to never bend on their core values, but to make sure it is their values they are honoring, not their gut feeling that their adversaries are idiots. In this case, Democrats talk as if compromise is a core value (it is not), and Republicans talk as if not raising taxes is a core value (it also is not). The way to get past this confusion is for one side to ask why their position (what they say they want) is so important to them. Democrats would respond that compromise is important to get an agreement. Why is getting an agreement important? Because it's our responsibility to get one, they might say. And why is responsibility important? It just is, when a value circles back on itself, we're talking about a core value. And what about the need to increase taxes on people over a certain income level? The core value is fairness.

On the Republican side, why is no new taxes important? Because many conservatives believe that taxes slow growth and discourage investments by small businesses. Why is growth so important? Because people want to grow their businesses, and we all want to grow the economy, but will not if government gets in the way, their thinking goes. And why is keeping government out of the way important? It is because it's about liberty. And why is that important? Because it is -- so it's a core value.

Jonathan Haidt mapped liberal and conservative values in his "Moral Foundations Theory." Liberals (and many Democrats) value care and fairness. Conservatives (and many Republicans) tend to value a broader cluster of issues, including fairness, liberty and authority.

Imagine what would happen if both sides agreed to build a solution to the fiscal cliff based on the core values of growth, liberty, responsibility and fairness. There would be tradeoffs, but that's a much easier process than to sit people down who abhor each other and lock the door until they get an agreement. They might eat each other first.

Pitfall #4: Thinking (and saying) that this negotiation has to be hard.  My years of negotiation consulting, teaching and study have taught me one thing: If you follow a simple process, negotiations can move so quickly that the progress is stunning. President Barack Obama has said an agreement could be done in a week. If the people came together and clicked down on the other sides' positions (what they say they want) and then formed a settlement based on a small set of core values, here's what would likely happen: formation of a plan that would target national policy on the goal of creating a thriving economy, that is as fair to everyone as we can get, because we have the responsibility to give our children something better than we have.

This process could be done in half a day. I have seen it happen in some of the hardest situations in the world in under an hour, when people finally decided to stop debating and start negotiating.

We are facing a national crisis that none of us have chosen. As others and I wrote as the housing crash laid waste to the economy, a crisis is a terrible thing to waste. By "crisis," I mean a situation of uncertainty. We need uncertainty, because without it we would just get more of the same partisan divide, people telling the media (and us) that they could get this done if only the other side was more accommodating and responsible. So the crisis is here. 

We can use this latest crisis to create tribes of leaders -- not just politicians -- in Washington if we demand that they avoid these four pitfalls. Really, this is not that hard.

I would love to hear from you!  What is your take on all of this?