We all know congressional negotiators are trying to balance party and ideology, principle and pragmatism. But negotiators are people, too, and psychology has some useful things to say about the ongoing debt-ceiling standoff. Here are some key ideas to keep in mind.
CHOICES: Behavioral economists find that people tend to make much better decisions about their future selves, rather than their present selves. Ask the alcoholic whether he is ready to give up booze next year and he'll find it easy to say yes. Ask him right now to walk by the bar and he'll balk. The same phenomenon shows up all the time for people who aren't alcoholics.
We can forsake dessert a year from now and we can decide to become better savers a year from now, but right now, we grab tasty bites from the dessert tray and spend like there's no tomorrow. The same principle applies to the budget standoff.
Asking Congress to think about what the shape of budget cuts should be in the future will likely yield a more productive conversation, where legislators aren't biased as much by current threats and temptations, says Richard Thaler, a University of Chicago economist, and the author of Nudge. "Congress would be better off spending a week dancing the hokey-pokey than debating the debt limit."
DEADLINES: At the same time, it's useful to have deadlines. If we told Congress to fix the budget deficit two years from now, they have no immediate incentive to act. Thaler suggests that one way to get Congress to act is to take advantage of the human tendency to pay undue importance to current threats and temptations.
"Suppose that we say that if the budget isn't reduced, Congress isn't paid anymore," he said. "Or worse yet, suppose they lose their parking spots if the deficit isn't reduced two years from now. All of a sudden you're going to see all kinds of self control adopted."
THE NEGOTIATING TABLE: Who sits around the negotiating table can make a big difference to how negotiations turn out. Psychologists have found that when groups are predominantly male, individuals tend to act in increasingly aggressive ways. They take bigger risks. They show off.
"Any place in which there are more men than women, the men are becoming more aggressive with each other and are competing with each other to attract women," says Vladas Griskevicius, a psychologist at the University of Minnesota.
Griskevicius has found that cities in which men outnumber women have the highest amount of consumer debt — the result, he believes, of men buying expensive stuff to show off. Most of us don't think the same dynamics affect professional settings, but Griskevicius finds in experiments that when men are surrounded by other men, their behavior changes without their awareness.
STEVE INSKEEP, host:
We talk of the debt ceiling debate in terms of numbers, but it's really about people; how people persuade one another, how they behave around a conference table.
There's a lot of psychology involved and NPR's Shankar Vedantam has been following that side of the story.
INSKEEP: Good morning.
SHANKAR VEDANTAM: Good morning, Steve.
INSKEEP: When you talk to experts, do they think this debt ceiling process is set up is set up in such a way to encourage good decision-making?
VEDANTAM: Well, I think psychologists have two key insights to share with all of us about the debt ceiling debate. The first comes from Richard Thaler at the University of Chicago.
Professor RICHARD THALER (Booth School of Business, University of Chicago): Congress would be better off dancing the hokey-pokey than debating the debt limit.
INSKEEP: Thats what it's all about.
(Soundbite of laughter)
VEDANTAM: Put your right foot in. Put your right foot out.
INSKEEP: Oh, my goodness.
VEDANTAM: So what the Richard Thaler argues is that we tend to make much better decisions when we are deciding things about our future selves, rather than our present selves. And so when the dessert tray rolls around, it's very hard to resist, you know, taking the desert. But if I were to ask you can you give up an ice cream a year from now, it's pretty easy to do that. Right?
INSKEEP: Well, it's easy to promise to do that, I suppose.
(Soundbite of laughter)
VEDANTAM: Well, I think Thaler's point is that when you're trying to make big and important decisions, it's much better to be making big and important decisions about things that are happening two years away or three years away, rather than things that are happening right now.
INSKEEP: Are you saying that there's something inherently dangerous about having this debt ceiling debate it's last minute, we're being warned of possible catastrophe, and yet the debate is really the long-term debate here, is about how America is spending money a year from now, five and ten years from now.
VEDANTAM: You got it. Now the reason we're using the debt ceiling debate as a way to have that larger conversation, is because the debt ceiling debate gives us a deadline. The problem is that it's the kind of deadline that if we blow it, we bring down collective catastrophe on all of us. Now there are things that might actually be much better ways to organize the kind of incentives that could get legislators to act quickly.
Mr. THALER: Well, if the budget isn't reduced, Congress isn't paid anymore. Worse yet, suppose they lose their parking spots. All of the sudden you're going to see all kinds of self control adopted.
INSKEEP: Wait a minute. Is he serious about that, that a privileged parking spot, the threat of losing that might cause a lawmaker to focus their minds in a different way?
VEDANTAM: You know, in the interview that I had with him, he said if there's one thing to take away today, it's about the parking spots, because I'm dead serious about it. And his point really is that because we're so focused on the present, we're disproportionately biased to focus on present temptations. If you link a balanced budget to parking spots, you're much more likely to get action than if you focus on much grander things.
INSKEEP: OK. There's also the matter of round-the-clock negotiations, because time is so short. Is that conducive to good decision making?
VEDANTAM: Well, we often think that the people who sit around the table, all they're bringing to the table are their political views, their ideologies, their party loyalties and so on. But they're also guys. I mean literally the people who sit around a lot of these negotiating tables are guys. The sex ratio of the people in a given place plays a huge role in how those people behave and how they negotiate with one another.
INSKEEP: Meaning that men negotiate differently than women and a group of men will negotiate differently than a group of men and women?
VEDANTAM: Well, I think it really comes down to how many men and how many women there are in a given space. I had a chat with Vladas Griskevicius who was a psychologist at University of Minnesota, and here's what he had to say.
Mr. VLADAS GRISKEVICIUS (Psychologist, University of Minnesota): Any places where there are more men than women, the men are becoming more aggressive with each other and they're competing with each other to attract women.
INSKEEP: OK. We're talking in general terms here. We're not making any allegations about any particular lawmaker.
VEDANTAM: We're not suggesting that Barack Obama and John Boehner are trying to catch Nancy Pelosi's eye. But what Griskevicius has found is that if you look at consumer spending in different places - so he looked at two cities in Georgia for example, Macon and Columbus, one of those cities has a consumer level debt that is $3,500 more than the other. Now these are comparable cities with about the same kinds of economy. One of those cities also has a lot more men and one of them has a lot more women. Now which would you guess is the city that has more consumer debt?
INSKEEP: Im sorry, are you going to tell me that the city where men would have a harder time finding a woman, they're more likely to spend more than they have?
VEDANTAM: That is exactly what I'm trying to tell you. In an experiments when men feel there are lots of other men around, they tend to pose more, they tend to talk tough, they become shortsighted, they take bigger bets. Any of that sound familiar?
INSKEEP: You're talking about unconscious psychology. Do you see evidence of people consciously using psychology in these debt negotiations as well?
VEDANTAM: I think the difference between what's conscious and unconscious, is that we generally know that Congress is playing games of chicken with one another. What they're not aware of are these underlying dynamics that are affecting the outcomes without anyone being aware of it.
INSKEEP: NPR's Shankar Vedantam, thanks very much.
VEDANTAM: Thanks, Steve.
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