Sunday, January 21, 2018

The Art of No Deal

As everyone has already noticed, a president who boasts about his deal-making skills, author of The Art of the Deal, has been unable to strike a deal to keep his own government funded. Worse, he actually blew up a deal in the making, and now negotiations from the White House side seem to have all but stopped. This is because the word "deal" doesn't mean what Donald Trump thinks it means. He doesn't want a deal. He wants a "win," which he defines as the other side losing. And that makes deal-making impossible.

Now, all the blame does not fall on Trump. We have years of legislative brinksmanship and hostage-taking to thank for this, all of it pioneered by the Republicans in Congress with their government shutdowns and debt-ceiling hijinks. McConnell and Ryan bear heavy loads of blame, as do the House Freedom Caucus, who often defy their own leadership, and the so-called "Hastert Rule" which allows Republican hard-liners to keep popular bills off the House floor. And White House Chief of Staff John Kelly, who is supposed to be keeping chaos at bay, seems to have actually been sowing chaos.

But Trump has also messed this up, torpedoing deals in progress. The infamous "shithole" meeting wasn't just a moment where the President singled out black-skinned immigrants as undesirable. It's also a meeting where the President unilaterally destroyed a bipartisan immigration deal that would have moved the funding bill forward. The White House has been disputing the particular foul word the President used, but not his refusal to accept African and Haitian immigrants or his sudden decision to rip up a deal that was close to being made.

If you want to know why the government shut down, that meeting is the key. The President of the United States ripped up a deal and offered nothing in its place. That's when the wheels came off.

John Kelly is also to blame for sabotaging that deal. Senators Graham and Durbin were scheduled for a meeting with the President about the deal they'd been working out, and walked into a room unexpectedly filled with anti-immigration figures who had no real reason to be there, like Tom Cotton. That only happens if the Chief of Staff permits it, or causes it.

None of this should be a surprise. Trump's business career is littered with examples of him changing deals or tearing them up after the fact. Think of the many building contractors he's stiffed, waiting until they'd done the contracted work and then not living up to his half of the contract. And think of his multiple bankruptcies, in which he borrowed vast sums of money, didn't pay it back, and then tried to renegotiate his debts so that he wouldn't have to pay in full. (Now, bankruptcies happen and we have bankruptcy laws for a reason, but the sheer number of Trump's is revealing.) This is why Trump hasn't actually put up a building in a couple of decades, as opposed to entering agreements to put his name on buildings other people create; Trump can't get the funding for his own building projects, because he's known for not sticking to his deals.

The many stories about stiffing contractors suggests that Trump doesn't see business in the both-sides-win, let's-get-to-yes way that most successful businessmen and dealmakers do. He sees business as a zero-sum, I win-you-lose proposition about dominating the other party and making them accept his terms. That is much closer to the mindset of swindlers and racketeers, ho look to extract everything they can without contributing anything to the deal. It's pretty clear that Trump sees business as about beating the other guy. But that mindset encourages people not to deal with you. In fact, it makes it irrational to deal with you. Why give concessions to someone who won't give any back?

This mindset is also clear from the way Trump talks about virtually every treaty or trade agreement the United States has, complaining that they are "terrible deals" and talking about blowing them up. He doesn't think about what America gets back from those deals. He just threatens to blow them up, hoping to extract extra concessions without giving up anything in exchange. No foreign government is actually going to do that, of course. But Trump's whole career has been about trying to get something for nothing.

Trump the deal-breaker has been on display for the last week. First he blows up the close-to-finished deal that Durbin and Graham were trying to finalize. Then, in the opposite of normal negotiating behavior, he kept demanding more and more without giving anything in return.

The way it's supposed to work when you get close to a deal is that each side trades a little bit more until they have a bargain. It's what you do when you buy a house, or a used car. And usually what you do in that situation is offer small concessions in order to get other concessions back. You do the sidewalk repairs the city inspector wants and I'll throw you some money toward closing costs. You  come up a little on price and I'll throw in the washer and dryer. What you never do is increase your demands when you're close to a deal. If we're five hundred bucks apart on price, I don't suddenly increase my ask by another thousand dollars. I don't suddenly demand that you pay my closing costs AND throw in your washer and dryer. Of course not. But Trump does.

There was a deal in process and, two days before the deadline, Trump blew it up, apparently expecting to get more. That wasn't just moving the goalposts. It was increasing the ask. The Democrats were willing to trade some things in order to keep 800,000 kids from being deported, including other immigration concessions. Then Trump said that wasn't enough, and essentially that he wanted Dem votes to avoid a shutdown without giving them anything on the Dreamers. Oddly, the Democrats were not eager to go along with a deal where they were getting less.

Trump even threatened to reduce his offer even more, tweeting his opinion that CHIP should be taken out of the bill. Fortunately, that did not happen. But it sure would not have helped. Then Trump spends ninety minutes personally negotiating with Chuck Schumer and got an offer of funding for his ridiculous border wall in exchange for not deporting the Dreamers. Then John Kelly calls Schumer to retract the offer. This is not getting to yes. This is actively, doggedly, moving toward no at every opportunity.

Now the Republicans say they refuse to negotiate about the Dreamers at all until the Dems cave on the continuing resolution. So they're saying the Democrats have to give concessions before even asking for things. Demanding the other side cave is not negotiation.

I have no idea how long this shutdown lasts. It could be over Monday afternoon. It could stretch into February. It may end in a compromise. It may end with the Democrats caving. It may end with the Republicans melting down. I really don't know, and I'd be a fool to make a prediction. But there are two real possibilities that should go into the mix.

It would not surprise me if Senate and House eventually make a deal without Trump and send it to him to sign. He isn't helping negotiations. They might hash this through without him.

It would also not surprise me if Trump increases his demands at some point, either demanding more concessions from the Democrats or taking back part of the offer already on the table. That would be a mistake, but it would be one of Trump's favorite kinds of mistake.

cross-posted from Dagblog; all comments welcome there, rather than here

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