The Rational Man in a Sea of Irrationality

The recent fight over the deficit problem between the democrats, as represented by President Barack Obama, and the Republicans, as represented by Speaker of the House, John Boehner gives us both a look at our leaders today and the problems we face as a country.   As a mediator, I always try and assist the opposing  parties in seeing how an agreement will better their lives even with compromise.  In reality, no one gets exactly what they want in a mediation unlike the result of a trial where the defendant either wins or loses his/her case.   However, both the Republicans and the Democrats appear to believe that they each  hold the solution to the complex problems we as a nation face making the game they are in:  Win-Lose.

David Brooks’ recent article, The Magic Lever, published in the New York Times on July 12, makes a very cogent and timely point: “Bankers, Democaratic Keynesians and staunch Republicans have one thing in common:  They all believe they have identified the magic lever.  They believe they can control their economic fate.”   Mr. Brooks then goes on to point out the fallacies of such oversimplified thinking.  

Not long ago one of the biggest ideologues, Alan Greenspan, confessed to Congress, that his belief in minimal government intervention with no regulations imposed in the private sector, is the best way to run an economy had been proven wrong.   Being a fan of Ayn Rand myself, this was difficult news for me to bear.   Unfortunately, an economy where there is no interference from the government, does not take into consideration the human motivation of greed and deception.  And so the bubble of greed and deception, as seen in past subprime mortagages, exploded, causing the present crisis that so many homeowners today are facing. 

On the other hand, John Maynard Keynes, who supported strong government interventions, was once asked what do we do in the long run?  Mr. Keynes was said to have replied;  “In the long run we’ll all be dead.”  Of course, the long run, in his mind, did not include our children and their children. 

Perhaps our leaders should ask that famous question  posed by Fisher and Ury in their classic work, Getting to Yes: “What is the Best Alternative to a Negotiated Agreement.”  One of these alternatives is not raising the debt ceiling.  Is it worth clinging to one’s views and not compromising with the outcome being America very possibly defaulting on its debt.  I don’t think so and neither does David Brooks.  What I like about Mr. Brooks is that when there is an impending crisis, he refuses to take the easy way out:  That is to blame the other side.  Rather, he sees the muddiness of, if you will,  Reality, and through this muddiness, understands the importance of compromise.   The truth of the matter is that the current complexities of the world will not get simpler in the future.  Given this fact, perhaps we all should step back for a moment and recognize that the economic assumptions made by our political biases may not always be correct.  Mr. Greenspan learned this.  It would be a step forward in the progress of the present conversation on the debt ceiling, if more of our leaders, that include both the President and Mr. Boehner, would allow their crystal clear vision of the future take on a few grains of realistic mud.