Four-box
models are everywhere if you look for them. This week I think I discovered a
new one. I’m rather proud of it. It seems to explain many things in life.
It concerns
deals, or transactions, or any human interactions, really. For any interaction,
the bottom axis plots its value to you, the vertical axis the value to the
other party. So you can call the top right corner win-win, the bottom right
win-lose, top left lose-win and bottom left lose-lose.
For negotiations,
the concepts of win-win and win-lose are well established. We are taught to
look for win-win outcomes, for many good reasons. They create the most value
and progress overall, and they are sustainable, in that two happy partners are
more likely to do business with each other again and to provide testimonials to
other parties. There is also a more cynical reason to understand win-win. By
looking at things from the point of view of the other party, trying to get into
their shoes, you can get a better deal for yourself. That is because you know
what the deal is worth to them and how willing they should be to negotiate, and
you can also work to concede items that matter a lot to them and not much to
you, and vice versa.
Most
everyday transactions between people who are not emotionally connected are
win-win. If you buy something in a shop, you get what you want and the
shopkeeper makes some profit, so both parties are happy. Most transactions are
rather trivial, but some can create huge value, such as major trade deals. That
way comes development for humanity.
Win-lose is
common enough too, and we all practise it from time to time. In some situations
there is no value to create so one party must lose, and in others, perhaps
where we don’t like our counter-party much and expect never to see them again,
we will drive a hard bargain. But extreme win-lose as a strategy is common
enough too. Think of Bernie Madoff. And of course we have a classic example in Donald Trump. The idea of doing a deal with a contractor, then failing
to pay what is owed for the last 20% once the work is completed, and then
lawyering up and bullying, is classic win-lose. War is usually win-lose, with
the perpetrators a narrow group of decision makers with vested interests (who usually lose as well once the dust has settled).
Then we
have the other boxes. I would contend that for most of us the box we employ
most often in life is lose-win. We use lose-win every time we give a tip or a
donation or a gift. You see lose-win every time two couples go to a restaurant
and argue over which will pay. Parenthood is all about lose-win. It is the box
of love, generosity and charity. Whereas proponents of win-lose tend not to end
up terribly happy, those who can learn to be generous receive their reward in
seeing the success of others and in the joy of giving. Giving is even seen as
one of the six key indicators driving national happiness.
Lose-win
does not have to be touchy-feely either; it can drive progress. Look at the
Gates foundation. Here we have a couple with so much money that the “lose”
involved in giving it away feels trivial, but where the benefits to recipients
can be transformative. Any interaction north east of a line from 10.30 to 4.30
on my box creates overall value. That includes all win-wins, and many win-loses
and lose-wins too. The lose-wins are typically more sustainable and more
prevalent. After all, a lot of us are parents.
That leaves
lose-lose, which always destroys value overall and therefore does not make
logical sense. But for one party, that is almost the point. There are many
situations where the motivation of one party has little to do with their own
benefit, but is all about creating losses for the other side. Think about
protests or vandalism, or about disruptive children in a school class. A few
years ago I had to undertake a direct negotiation with an addict, someone who
had lost hope and with impaired intelligence, not concerned with avoiding
further self-harm but only of obstructing me. Such a process, especially with
someone I loved, was almost impossible. Agreements were reneged on, process
disrupted and delayed, new disputes opened up at will. That is the classic
lose-lose situation.
This brings
us to current politics. The Bagehot column in the Economist has improved
recently, since top writer Adrian Wooldridge started authoring it. In February,
he focused on a book from 1957 by a writer called Michael Young, an influential
socialist of the time. Young made an immensely prescient claim about the future
of politics, dividing society into the elite and the rest. At the time grammar
schools were a political discussion point, and there was growth in an educated
class Young termed meritocratic. He argued that inevitably this group would
contrive to tilt the rules in its favour. They would become intolerably smug,
while the rest would become dangerously embittered.
It can be
argued that this is precisely how the next sixty years have turned out. After a
burst of altruism immediately after 1945, and despite occasional
well-intentioned attempts and lots of contrived argument, the educated elite
has consolidated its advantages. After 1980 it became more blatant, reducing
progressive taxation, giving more power to corporations and lobbyists,
increasing the premium for education and ensuring such gains could be passed
between generations. And indeed, this group has become smug and the rest have
become bitter.
We see the
results in Brexit and the rise of populists. To the bitter, this has become a
lose-lose. Most Trump voters don’t like him but they can see that the smug elite
will like him less. They are not aggressively racist or anti-immigrant, but
resent being condescended to by people undermining norms. They may respect gay
people, but not those demanding ever more initials behind LGBT. They probably
know Brexit will cost a bit of money, but agree with Michael Gove that we have
heard more than enough from so-called experts. As Bagehot notes, this also
explains why few Brexiteers or Trump voters have since changed their mind
despite mounting evidence: they can’t possibly admit that the other side was
right. This is lose-lose in action. It is destructive, ugly, and hard to escape
from.
Escape will
be hard, short of war. It requires rebuilding trust and respect. It will help
that Trump will be exposed for what he is. It will help if more Trudeau’s and
Obama’s appear. It will help if the policy pendulum moves back towards
progressive causes. But in the end when you have little tangible to lose and
even your self-respect is taken away, your own lose in the lose-lose becomes ever
more irrelevant while the lure of giving the elite another bloody nose only
gets stronger.
The
Economist has started to argue for stronger public services and other policies
to counter elites, such as seriously addressing cross-border fraud. That is to
its credit, but ultimately it is hard to see the Economist as anything but
smug, and Mr. Wooldridge as its epitome (he would readily accept this, I
believe). Macron is unbearably smug, so I predict he will last but one term in
office. It is hard to become un-smug. In 2016 I wrote a blog “a speech for
Hillary”: it conclusively demonstrated both my own smugness and my uncanny
ability for missing the point. That horrible lose-lose negotiation cast a
similar uncomfortable self-reflection.
In my smug
way, I fancy this new four-box model might have legs. You can even personalise
the quadrants. Gates, Obama (and Jesus) in the top left, Buffett or Jobs top
right, Trump or Putin bottom right and Farage or Le Pen bottom left. I think it
helps to explain our motivations in many situations, as well as offering some
ways to be better people.
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