I’ve become a big fan of game theory in recent years. It started when David Winston first introduced me to a Yale open course, Econ 159, a game theory course taught by professor Ben Polak.
At its most basic, game theory is the theory behind strategy: actions you can take, actions others can take, and the resulting payoffs for both sides. There’s a useful intersection between game theory and polling in a political context, as the desired payoff or outcome of a certain strategy usually involves a move in the polls (winning more voters on a ballot, persuading more people to side with your party, convincing more people to agree with your policy position, etc.).
I think game theory is a useful tool here to understand why we are at the place we are at in this government shutdown situation. A “decision matrix” is a simple way of mapping out “If I do X, and my opponent does Y, this is what happens to both of us as a result” for a variety of scenarios. In the case of the most recent standoff, it may be oversimplifying things to give each side only two choices, but for simplicity’s sake, here is what the decision matrix around this shutdown looks like, absent payoffs.
Let’s walk through what each of these scenarios looks like, then.
SCENARIO ONE: If we take the situation where the GOP passes a bill that locks in the sequester but avoids dealing with Obamacare, and Democrats pass it. If these strategies had been chosen at the start, the payoff here is essentially neutral, the status quo. In July 2013, before the August recess, Republicans and Democrats were tied in the NBC/WSJ poll’s “generic ballot” that asks people if they’d rather have a Republican or Democratic controlled Congress. Status quo has drawbacks for both sides: Republicans begrudgingly supporting a bill that includes funding for provisions of Obamacare, Democrats begrudgingly supporting a bill that includes the sequester. Likely outcome: STATUS QUO.
SCENARIO TWO: Now let’s consider what happens if the GOP passes a bill that locks in the sequester and makes fundamental changes to Obamacare, and the Democrats pass it and it is signed by President Obama. Republicans would consider this a win, and was the best-case scenario outcome for them. In this case, the government stays open, Obamacare is defunded, and a major portion of President Obama’s legacy is removed. This outcome for Republicans from a policy perspective is positive, the outcome for Democrats deeply negative. Likely outcome: BIG POTENTIAL REPUBLICAN WIN.
SCENARIO THREE: What about a world in which Republicans pass a “clean bill” that preserves the sequester without making serious changes to Obamacare…and Democrats say no? Poll after poll shows that Americans are deeply concerned about our national debt and want to see government spending curbed. Saying no to a “clean bill” would risk being a bridge too far for Democrats. Obamacare remains untouched. Likely outcome: SMALL POTENTIAL REPUBLICAN WIN.
SCENARIO FOUR: Republicans and Democrats both “hold the line.” Republicans only pass bills that fundamentally alter Obamacare, Democrats refuse to pass or sign any bills that fundamentally alter Obamacare. The impasse leads to a government shutdown.
It is here that attitudes about the likely outcomes of the scenarios diverge. If you looked at polling before the shutdown, showing that voters overwhelmingly did not want to see the government shutdown over disagreement with Obamacare, and placing more blame on Republicans than Democrats, it was clear that this was the scenario that plays out worst for Republicans. The Republican brand would be damaged, the party fractured, and in the end, this scenario does not lead to Obamacare being fundamentally altered in any way. The endgame is gridlock and shutdown.
The decision matrix therefore looks like this:
Here’s where the problem emerges. The Defund movement viewed the decision matrix differently. They proposed that enormous public opposition to Obamacare would swell once Republicans in Congress stood up and voted to defund, and that the wave of public opinion would pressure Democrats and President Obama to cave. Essentially, they believed that if Democrats embarked on the “Oppose” strategy and we wound up in Scenario Four that the payoffs for Democrats would be a major loss in public opinion (due to not compromising/shutting down the government to preserve Obamacare) which would eventually pressure Democrats to change strategy and we would wind up in Scenario Two.
The decision matrix for the Defund movement would therefore look like this:
In order for the Defund movement strategy to lead to the removal or delay of Obamacare, it required that the payoffs resulting from Scenario Four to be so unpleasant for Democrats that they ultimately bend to public will and pass/sign bills that defund or delay Obamacare, bringing us into Scenario Two.
The House did in fact pass a bill that defunded Obamacare while funding the rest of the government. They played that strategy. The bill went to the Senate and did not survive. We wound up in Scenario Four. Bill after bill, idea after idea, and we always wound up in the same place: Scenario Four.
And as Scenario Four has played out, it has become increasingly clear that it is not playing out as the Republican win that the Defund movement may have hoped for or predicted. I will give the Defund movement the benefit of the doubt, and assume that they honestly did believe that even initially winding up in Scenario Four would ultimately lead to Scenario Two.
I was one of those people and believed from the very beginning that Scenario Four would play out as badly for Republicans as is has. My firm was criticized by supporters of the Defund movement for alleging the very same thing prior to the shutdown.
Now, the game has been played out, we know the result, and we know who was right about the outcomes.
This morning, some conservative leaders like Laura Ingraham acknowledged that Scenario Two cannot happen in the context of this current debate, this current Congress, this current White House. The numbers were not there to force Democrats to play the “pass/sign the bill” strategy, not in the polls, and not in the votes in Congress.
But other leaders are saying to stand firm. Don’t blink. Keep fighting. Never surrender. Some are calling for any member who “blinks” to be primaried and driven from office.
I do not fault those who are enormously angry about Obamacare for being adamant that the law be repealed. The negative outcomes of this law are playing out in front of us, with the disastrous rollout of the exchanges, the number of people getting letters confirming "No, if you liked your plan, you can’t keep it," those who are purchasing bronze or silver plans only to discover unmanageably high deductibles.
I also understand that Congress has the power of the pursestrings and that many Republican members were sent to Washington to fight Obamacare.
All of that being said, what I am waiting to hear is a plan that gets us to Scenario Two. In this present Congress, Scenario Two was never a possibility because Harry Reid had enough votes in the Senate to prevent the House’s best efforts from going anywhere. The House voted to pass the exact bill that the Defund movement wanted. They did what they could. There was nothing more to be done. It was stopped in the Senate. Even if it had made it through the Senate, with red state Democrats joining Republicans in the vote, there was no chance on this planet that President Obama would sign that bill. Ever, no way, no how.
Looking at the two “GOP Strategies,” knowing there is no possible way to achieve Scenario Two in this Congress, to continue playing the “defund” strategy is the losing strategy that may cost Republicans critical elections. The 2014 midterms should be an election where the wind is at Republicans’ back, with demographics and the curse of a President’s second term midterm helping the GOP along. Voting to abandon this current strategy, with the intent to return to this battle when the terms are more favorable, is not a vote in favor of Obamacare. If there is a way to achieve Scenario Two before the 2014 or 2016 elections, I am eager to hear what that strategy looks like. “Standing firm” has not gotten us there, and people deserve to know how leaders intend to achieve the results they are promising.
Republicans have played their strategy and Democrats have played theirs. The result of the game has been clear. To take action that will set up the greatest possibility of one day achieving “Scenario Two” and the rollback of Obamacare, conservatives should demand results, not rhetoric, and results in this game are only possible through changing the terms of the game. That comes through winning more elections.