Negotiating Life

To Negotiate Or Not?

Politicians and pundits often give simplistic, categorical advice about negotiations and settlements. They tell us “Never negotiate with terrorists” and “Always negotiate from strength.” But in fact, questions about whether to negotiate and when to settle are the most difficult that ever come up in conflicts, and with good reason. They require complex evaluations of competing interests and uncertain predictions about the future. What’s more, they usually have to be addressed when emotions are high.

For anyone involved in a conflict, the underlying question is always, Can I do better? Can I do better if I refuse to negotiate with a deceitful former business partner who stole my product ideas and customers? A vindictive ex-spouse who refuses to let me see my kids? A brutal Taliban that has wiped out my village? And if I do negotiate, can I do better if I reject the other side’s offer?

To make such vital decisions, you must, like an ancient seafarer passing through the Straits of Messina, avoid both Scylla and Charybdis. The Scylla in this case is something called “the winner’s curse.” It results from agreeing to something too quickly, not recognizing that a little more thought, time, and effort might yield a better deal. The Charybdis, at the opposite extreme, is “the enemy of the good,” a term derived from Voltaire’s declaration Le mieux est l’ennemi du bien—the best is the enemy of the good. It means that exaggerated hopes of doing better can cause people to reject an otherwise acceptable offer or refuse to negotiate at all. The outcome may be protracted conflict, escalated hostilities, additional costs, and in the end a worse deal.

To navigate successfully, rely on these five guiding stars:

Priorities.What are your main goals? Although you may gain some emotional satisfaction from driving a deceitful partner out of business, humiliating a vindictive ex-spouse, or crushing the Taliban, your real priorities may lie elsewhere—in restoring the health of your business, getting on with your life, or bringing peace to Afghanistan. Perhaps those interests will be best secured if you sit down to negotiate with the other side and eventually strike a deal, even if it isn’t the best deal you can conceive of. For example, at the beginning of the 1979 Camp David negotiations between Israel and Egypt, Israel refused to give up parts of Egypt’s Sinai Peninsula. But it relented when it understood that its first priority, security on its border with Egypt, could be met only by allowing Egypt to regain the territory.

Alternatives. What are your options if you don’t negotiate? And how likely are they to satisfy your interests? Your alternative to accepting your partner’s proposed settlement is probably a lawsuit; if you determine that you could win it, or at least use it to squeeze out a better deal, you might as well turn him down. But that is not always the case. In 1990, one of the reasons the African National Congress and the South African government decided to negotiate peace was that both sides realized that coercive alternatives would not achieve their goals. The same was true in 1993, when the Palestinians and the Israeli government sat down together.

Benefits. What do you stand to gain from negotiating? You might not have enough information to answer that question until negotiations are under way. It is sometimes wise to start negotiations with the intention of stopping once you have learned that the other side cannot or will not give you the benefits you are looking for.

Costs. What do you stand to lose? Every negotiation carries a cost. The very act of negotiating may make legitimate an illegitimate adversary. Or enable the other side to gather valuable information, or cause conflicts between you and your constituents. Some course of action other than negotiation may allow you to attain your goals more quickly. In addition, a settlement will always entail giving up something you feel you deserve. Whatever the costs are, you’ll need to weigh them against the benefits you expect. Consider President Nixon’s decision to negotiate with China in 1972. In retrospect, it may seem like an obvious step, but at the time, Nixon had to make a careful analysis: the failure of those talks would have hurt both the United States and Nixon.

Prospects for implementation. The purpose of any negotiation is not just a deal, but a desired change in the other side’s behavior. So how likely is the other side to honor its part of the bargain? Say your former partner agrees to compensate you. Will he actually come through with the payments? And if the Taliban leadership signs a peace treaty, can they and will they persuade their disparate forces to lay down their guns? Doubts about how faithfully arms control agreements would be implemented were what prompted President Reagan to invoke the Russian proverb “Trust but verify.” It was only after adequate verification mechanisms were put in place that he signed the 1987 Intermediate-Range Nuclear Forces Agreement.

The correct answer to the question of whether to negotiate and when to settle is almost always “It depends.” It depends on your priorities, your alternatives, the benefits to be gained, the costs to be incurred, and the prospects for implementation of a deal.

JESWALD W. SALACUSE is the Henry J. Braker Professor of Law and former dean of the Fletcher School at Tufts. His most recent book is The Law of Investment Treaties (Oxford University Press).