When Not to Negotiate

From the Business Conflict Blog of Peter Phillips.

As recently as a few weeks ago this blog noted the distinction between public and private negotiation. Nevertheless, the current debate concerning raising the public debt “ceiling” seems to present a stark lesson on when to negotiate and when not to.

Readers will recall that the federal government can neither spend nor borrow money without congressional authorization. Congress has authorized expenditures in excess of revenues, but there is a (putatively) serious debate about whether to authorize further borrowings to pay for those authorized expenditures. Failure to do so would constitute a default on the nation’s debt — an eventuality that is broadly viewed as imprudent.
This situation might serve as the basis for a hypothetical in negotiation class, and feedback would be welcome on whether the following analysis is the correct one:
1. A guy comes up to you, draws a gun, holds it to your temple, and tells you to sign this or he’ll blow your head off. RESULT: Negotiate
2. A guy comes up to you, draws a gun, holds it to his own temple, and tells you to sign this or he’ll blow his own head off. RESULT: Don’t negotiate.
3. A guy comes up to you, holds up a sinister-looking box, and tells you to sign this or he’ll kill you, and himself, and his kids, and your kids, and the market value of his house, and the exchange rate of the dollar, and the global financial system, and interest rates, and economic recovery. RESULT: ???
Well, you call his bluff, don’t you?

                        author

F. Peter Phillips

F. Peter Phillips is a commercial arbitrator and mediator with substantial experience providing consultation on the management of business disputes to companies around the globe. A cum laude graduate of Dartmouth College and a magna cum laude graduate of New York Law School, Mr. Phillips served for nearly ten years… MORE >

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