Lesson of the Shutdown: Don’t Burn Your Boats
There's a legend that after Hernan Cortes and his crew landed on the shores of the New World, Cortes ordered that their boats be burned. The only way they would be able to get back to Spain would be to conquer the land, giving them the resources to build new boats. With necessity at their backs, his band of adventurers managed to conquer all of Mexico.
It's not clear if this story is actually true, but it's nonetheless beloved by motivational speakers. The last two weeks of political paralysis have been an excellent illustration of why you shouldn't model your negotiation strategy on a guy who's mostly famous for slaughtering strangers.
In the aftermath of the government-shutdown debacle, many Tea Partiers have chosen to blame . . . Republican moderates, for wavering. In their telling, there was only one way to get out of this: go all in, stay the course, never surrender. The idea seems to have been that the Tea Party was supposed to provide the inspiration, by committing the Republican Party to a strategy that would lock in losses unless it somehow won big. Then the whole party would pull together and . . .
. . . And what? Every time you pressed for specifics, you got the Underpants Gnome theory of victory. For those who are not familiar with the Underpants Gnomes, they're characters from "South Park" who steal underwear. When asked why they would do this, the gnomes reveal the following business plan:
- Collect underpants
Conversations with supporters of the shutdown went in a similar fashion. Why were the Democrats going to settle when the Republican Party's poll ratings fell more every day that the shutdown dragged on? Nothing that went in that space with the question marks was vaguely plausible: Democrats were going to cave because the shutdown would break through the news media bias that had kept the public from realizing what was going on in Washington. Or the public would be so outraged by President Barack Obama's completely gratuitous closure of national parks that the administration, not Republicans, would see its support slip. Or Democrats wouldn't be able to stand the sight of their beloved programs being shut, and they would cave. All that was needed was for Republican moderates to commit.
When the moderates beat a retreat, the boat-burners demanded to know how they could give in when they had gotten nothing. They were deaf to those who pointed out that once their poll numbers started falling dramatically, the best-case scenario involved preventing them from falling further. The moderates always had the better case, starting with when they tried to persuade the party's right flank not to burn the boats. The Republican Party controls one half of one branch of government. To state what should be obvious, you cannot legislate when you control only one half of Congress. The boat-burners started with the premise that there was some way to govern as if they also controlled the Senate and the White House, and then they looked for the plan that would enable them to do this. Because there wasn't any way to do this, they settled on doing something insane in the hopes that this would somehow give the party the resolve to do the impossible. The boat-burners forgot that there's another way for that scenario to end: Everyone gets slaughtered by the Aztecs.
They aren't the only ones who ought to take that lesson away from the last two weeks.
On Dec. 8, 2009, Republican Scott Brown surprised everyone by winning a special election in Massachusetts to replace Senator Ted Kennedy. Suddenly, Obamacare didn't have enough votes to break a Republican filibuster. What were Democrats to do? Passing the bill they wanted to pass had just become impossible. Starting from the assumption that a bill must be passed, they took a draft bill from the House and passed that. It wasn't the bill that anyone wanted, but once they passed it, they figured, the Republicans would have to help them fix it. Or else they'd lose seats in 2010, and the Democrats could fix it then.
Bad guess: The Republicans gained seats, in part thanks to . . . Obamacare.
Fast-forward to now: The state insurance exchanges aren't working, Obamacare is in jeopardy, and Democrats are casting around for a way to blame this on Republicans. The answer they have settled on: It's their fault because Republican governors did not set up exchanges.
Think about what they are actually saying: "We passed a law that was so incredibly fragile that it was destined to fail unless all the state governments controlled by the party that opposed this law worked hard to make the system a success."
And why did they expect this to happen? The answer boils down to this: "After we burn the boats, everyone's supposed to band together to fight the Aztecs!"
I've long criticized the health-care law for being a Rube Goldberg Policy Machine: There are dozens of pieces that all have to work perfectly. If one of them fails, the whole apparatus breaks down and the individual insurance market spirals toward death. That seemed risky to me, especially when the law was passed over fervent opposition -- a fervent opposition that was smugly told that "elections have consequences," without anyone apparently considering that future elections might have different consequences.
But in this view, the Rube Goldberg quality is actually a plus, because after all, if we do something that might break the insurance market unless Republicans enthusiastically cooperate, they'll have to enthusiastically cooperate.
This is . . . what's the technical term? Right, insane.
Start with the fact that the state exchanges -- what we would have had if the Republican governors and legislatures had cooperated -- aren't all in such great shape, either. Don't get me wrong; some of them are doing very well. But some aren't really working at all, and in others the results are . . . unclear. And that's in blue states where the governor and the legislature were hugely enthusiastic about this program and are going all out to make it work. As anyone who has ever implemented a new program (corporate or government) can tell you, one of the biggest hurdles is getting people who don't care about your program, or who actively oppose it, to make their piece work. Even if they're trying in good faith, they have neither your enthusiasm nor your deep grasp of the internal logic. In the best-case scenario, it's not their No. 1 priority; when it competes for resources with stuff they really care about, it tends to get the second-string people and budget. This is one reason that promising pilot projects often fail when they're rolled out to the larger organization—and one of the most important things that a corporate innovator has to do is to evangelize his program so that other departments get as enthusiastic as he is.
The Obama administration was not in a position to evangelize the president's health-care program to Republican governors. If the law absolutely required that those governors be as enthusiastic about implementing a state exchange as the folks in the administration, then it was a bad law that should never have been passed, and the Democrats made a grave mistake that could destroy the nation's insurance market.
After the boat-burning failed the first time, leaving it weeks from its debut without a working computer system, the administration seems to have decided that what was needed was simply a larger bonfire: Launch the nonworking system, because after all, once you've gone live, the potential catastrophe would be nearly upon us, which would somehow force those inside and outside the administration to somehow bring order out of the chaos they had created.
But Republicans should make this work! It's the right thing to do! That is, of course, debatable. But aside from that, this is magical thinking -- as magical as the Tea Partiers who responded, when I pointed out that the shutdown was costing them the support they'd need to retake the Senate and the White House and actually get some policy making done, that this was all the fault of the liberal media, which was just repeating administration talking points.
Leave aside the question of whether the media is biased the way the Tea Party types think it is. Assume arguendo that they are correct. Well, this wasn't a surprise, was it? Conservatives have been complaining about media bias for decades. If media bias caused your plan to fail, well, then, your plan was always doomed to fail, just like Republican moderates said it would. And, therefore, it was a very bad idea that should not have been undertaken.
Both parties this week should be taking a long, hard look at the giant question marks in their plans, the place where actual logical planning should be. Both parties should be reconsidering what they might call the "scorched boat" strategy. Alas, all that I'm hearing indicates that they're spending most of their time looking for more matches.
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
To contact the author on this story:
Megan McArdle at firstname.lastname@example.org