Trump, Pelosi, & the Lessons of the $20 Auction

Most people I know are utterly dumbstruck by the petty politics currently being played between U.S. President Donald Trump and Speaker of the House Nancy Pelosi. In the throes of the longest government shutdown in U.S. history – and with virtually no end in sight – not only are neither of our national leaders doing anything productive or constructive to find a solution, they’ve also managed to open up another front in the conflict – a high-profile, petty, and pointless power play. It started when, citing security concerns, Speaker Pelosi suggested that the President should postpone his State of the Union speech until after the government shutdown ended.  The President then denied Speaker Pelosi and a Congressional delegation a government plane for a trip to visit U.S. troops in Afghanistan and to Brussels and Egypt. Next, the President wrote to Speaker Pelosi to let her know that the Secret Service assured him there were no security concerns regarding the State of the Union. In response, she wrote back rescinding his invitation to speak in the House chamber until the government shutdown ended and reminding him that he could only speak in the chamber with her permission.


If I were writing a fictional novel with the above set of events, I’m not sure I could get an editor to take me seriously. But here we are. And what will happen next is anyone’s guess,


The puerile antics between these two national leaders reminds me of an exercise I run in the first hour of virtually any negotiation workshop I teach. In this exercise, I auction a $20 bill to the highest bidder. That person pays me whatever they bid for the $20 and they (of course!) receive the $20 bill. The rules of the game require the second highest bidder to also pay me whatever they bid, but of course, they do not receive anything.


I’ve played this game hundreds of times in contexts all over the world. When I play outside the U.S., I will use the local currency in an amount closely approximating $20 U.S.


Never once have I auctioned the $20 bill off for less than $20. On most occasions, I will easily sell my $20 bill for $30 or $40 or $50. In September of 2015, I achieved a record sale: I sold my $20 bill off for $560.00. It was a good day for me, but not for the person who bid $560 for the $20; nor was it a particularly good day for the second bidder, who ended up owing me $559 and didn’t even get the $20 bill.


If you’re scratching your head and wondering how anyone would bid more than $20 for a $20 bill, consider the structure of the game: the highest bidder pays me their bid and gets the $20; but the second highest bidder also has to pay me and they do not get anything. This means that as soon as there are at least two bidders, it’s pretty much guaranteed to keep bidding past the $20 mark. Why? Well, if you bid $15 and someone else just bid $16, you don’t want to lose your $15, so you better bid $17.  But the counterpart doesn’t want to lose her $16, so now she will bid $18, and onward. Even when you get to the $20 mark, you’d rather bid $21 and lose $1.00, then lose $19.


The game offers an important negotiation lesson for those experiencing conflict and who may be considering an escalation.  


Beware the role of 2 E’s that can take control in situations with a similar structure:  ego and emotions. The auction – like many conflict situations – looks like an opportunity to win. But within short order, it’s no longer who is going to win more, but who is going to lose less.


So, the lesson, of course, to avoid being tempted by greed into a game that is going to produce only losers! At this point, this lesson is a bit too late for Pelosi and Trump, though worth considering for the future.


But this leads to a question that you may be asking.


When the bidding goes over $20 and both parties are now losing, but egos and emotions are high, how does the game ever stop?


Well, in most cases in a classroom setting, once the parties realize what has happened, laughter and eyerolls take over the room and someone just throws up their hands and stops so that the class can move forward.


However, in the cases where bidding exceeds $200 – and I have had my share of these, by the way – it hardly ever ends with someone just throwing up their hands and laughing it off.


Even in a classroom setting, at this point of escalation, individuals’ reputations and ego are on the line.


So, how does it end?


In those very high value situations, the game typically ends when a THIRD PARTY makes a bid.


“What?” you may be asking. “Are you saying that a third party will bid $200+ for a $20 bill, knowing they are going to lose $180 at least just to make the game end?”


Yes, that is what I’m saying.


And the reason why this works is because the ego and emotional aspect of the competition between the two who had been stalemated ends with the presence of a third bidder.


There is a lesson for my negotiation and conflict resolution students here as well: intervention in conflict is costly – both in the classroom and in real life. But, when well-thought out, intervention can help break a conflict cycle.




So, all of this brings us back to the current situation between the President and the Speaker of the House. The bidding has well exceeded $20; we’re officially in a lose-lose situation. But for the ego and emotions quotient, there may be no end in site.  


It’s unlikely one of the two are simply going to “give in” so that the class – in this case, the nation itself – can go on.


So, from my perspective, our best hope is for the entry of an altruistic third-party bidder.


A credible third-party bidder has to be someone whom both sides can respect. Regrettably, this knocks out the kind of people who might traditionally play this role well, such as a Democratic/Republican partnership between Presidents Obama and Bush.  Because President Trump respects neither, they would not be able to be the third-party bidder.


The third-party bidder also has to be seen as someone who does not have a stake in the outcome, apart from the stake we all have as citizens of a country we love. But this knocks out anyone who might be considering a Presidential run in 2020, even persons who are largely seen by both sides of the political aisle as adults, such as Michael Bloomberg.


The third-party bidder also has to be someone who is willing to take a risk to her/his own reputation – who is willing to spend some political capital and who may get pilloried from any and all sides; who can claim the respect and attention of all sides; who doesn’t see or want involvement for some future political agenda or to resurrect/reclaim their reputation, etc.


The list of individuals who meet all of these criteria may well be short, but here are a few possibilities:


·      A small interfaith consortium of highly prominent religious leaders. There should be no more than perhaps five people involved here: perhaps Franklin Graham, a highly-regarded rabbi, a nationally-recognized Muslim religious leader, and a prominent Roman Catholic Cardinal such as Timothy Dolan of New York City;

·      A widely admired former American diplomat who is respected on all sides of the political aisle. Former U.S. Secretary of State James Baker comes to mind as someone who could perhaps succeed here.

·      A widely admired D.C. insider with a record of fair-play and working in administrations of both parties. Specifically, Ken Feinberg comes to mind. Mr. Feinberg was appointed by President George W. Bush after 9/11 to design and administer the 9/11 compensation fund. In 2009, President Obama appointed Feinberg the special czar to monitor CEO compensation after the mortgage foreclosure crisis and the Great Recession. A second example could be former U.S. Treasury Secretary Hank Paulson, widely regarded as a no-non-sense, largely apolitical problem-solver.


It seems to me, the moment is ripe for the right third-party intervenor to insert themselves in a way that might be able to break the logjam here.


If that doesn’t happen, it seems to me that the other way this will end is by sheer exhaustion. I worry that if we have to wait for Trump and Pelosi to reach the exhaustion point, the country is in for a very long wait.

Robert BordoneComment