Shutdown Roundtable: Bargaining Strategies

One thing is certain: Republicans’ bargaining strategy is a winner. Over the past couple years Republicans won major legislative concessions while still winning the message battle. It’s an impressive feat for a minority party (or sort of minority party in today’s Congress). Democrats on the other hand take a different approach. They are willing to compromise. Nowhere was this more evident than the healthcare debate. Republicans demanded legislative concessions. Democrats would cave, adding those elements to the bill. Then, Republicans would reject the new bill and demand more concessions. Demand and dump is one of the ways Republicans have remained both relevant in policy negotiations while consistently winning the message battle. Though Republicans ultimately lost on healthcare – there is only so much a minority can do – they managed to pull off some notable victories. They enticed Democrats to draft a conservative bill while remaining in opposition to the bill itself (example: Budget Chairman Ryan's proposed mechanism for exchange rates is virtually the same as the ACA’s. See here and here). These tactics are not only brilliant, but if you’re a Democrat, they’re fairly embarrassing.

This game is continuing in today as members negotiate the budget. As we draw closer to a government shutdown, Democrats are still whiffing on fundamental bargaining strategies. As it stands today, Republicans are trying to squeeze another $7 billion in spending cuts on top of the $33 billion they already negotiated. Why can they do this? It’s part Democrats trying to be “bipartisan” and its part Republicans torn between the two wings of their party.

For one, Democrats seem willing to accommodate Republican policy positions from the start. This tactic may seem a gesture of good faith but it effectively undercuts Republicans. If Democrats preempt Republican policy preferences, Republicans can’t claim victory. They cannot go to the public and say they negotiated a deal or fought hard for their principles. They can’t do this because Democrats are doing it for them. Republicans could, of course, reposition themselves. Instead of fighting it, they could wax poetic about their dominant economic philosophy. But you don't win elections that way. Their current strategy is so much more effective – not to mention damaging to Democrats.

Over the past couple of years, the demand and dump strategy has worked with great effect. However, a government shutdown is different. It’s a larger stage with bigger consequences if negotiations fall through. Government workers will not get paid. The justice system will shutdown. The 1995 shutdown derailed the Contract with America and ultimately Gingrich’s domination. If the blame falls on Republicans, it will be the first time in a long time this strategy hasn’t worked. The rewards are big but so are the risks. In a couple days we’ll see if it works once more.