As a commercial real estate broker I make my living negotiating transactions, so I've found the current debt-ceiling negotiations between President Barack Obama and the Republican majority in the House of Representatives both mind-boggling and fascinating to watch, especially as the president has shifted his negotiating strategy.
The president started with a "win-win" approach. He now appears to have changed to a win-lose strategy in response to the Republicans' win-lose approach.
Win-win is essentially a problem-solving exercise in which the parties collaborate to find a solution that satisfies everyone in some way. Mutual compromises are expected. This approach works best when the relationship is as important as the issues, and it has the highest chance of success.
Win-lose takes place when issues matter more than the relationship, when one side strives to get what it wants and doesn't care if the other side loses. This approach is not as successful as win-win in reaching an agreement.
Win-win can't work in negotiations where one party takes a win-lose approach. The win-lose party cares only about getting his way, while the win-win party tries to reach consensus by mutual compromise. It's like oil and water. Win-win looks for common ground where there isn't any, while win-lose keeps singlemindedly pushing for his objectives.
In commercial real estate sales, the major concerns are typically issues, not the relationship with the other party. As a result, negotiations are almost always win-lose. By contrast, in lease negotiations, the parties know there will be an ongoing relationship between them and there tends to be more concern about the relationship, so they look for a win-win.
Obama started off pursuing win-win. Actually, both sides appeared to begin with win-win approaches. The speaker of the House, Republican John Boehner, initially agreed with the president's proposal for a grand scheme that combined major cuts in spending with changes to the tax code.
But Boehner could not sell the grand scheme to the House Republicans, who insisted on a win-lose strategy. The president at first kept pushing the win-win approach. In his press conferences, he almost begged the Republicans to join him in mutual compromises. But the Republicans stuck with win-lose. Now it appears the president has given up on win-win and is pursuing win-lose.
The president probably started with win-win for a couple of reasons. First, it fit his nature. He's intelligent and highly educated: Approaching negotiations as a problem-solving exercise in which reasoning can produce the best results with the highest odds of success would be his first choice. Second, he probably was getting signals from Boehner that a grand scheme, based on compromise, could be accomplished. It was worth a try.
As much as we constituents might like to see our politicians figure out a win-win solution, the fact is that neither party really cares about the relationship. In fact, each wants the other side to lose -- big time. Win-win was never likely to succeed.
It's sad to see so much political one-upmanship, and so little statesmanship, in negotiations that put party politics ahead of the interests of the country.
Chris Stephens, CCIM, is a local associate broker specializing in commercial and investment real estate. His column appears every month in the Daily News.
CHRIS STEPHENS
REAL ESTATE