19.9.02

WHAT'S THE BEST MOVE? Andrew Sullivan posts an item that is worth quoting in full:

UNILATERAL MULTILATERALISM: I've long been skeptical of the notion that governments in foreign affairs are either multilateralist (good) or unilateralist (bad). It seems to me that any government's first priority in foreign policy should be the pursuit of national interest, broadly understood. For some, that's a unilateralist position, almost by definition. But I'd argue that it's more nuanced than that. The pursuit of national interest can (and should) lead to multilateral arrangements - NAFTA, GATT, NATO, the EU, etc - that benefit each party. Moreover, these multilateral arrangements work precisely because they do represent the sum of national interests, and aren't merely talking shops based on high-minded but impractical ideals. These diplomatic contraptions, in other words, are means, not ends. Bush gets this, I think. And it's a profound improvement on the muddled abdication of American leadership in the previous administration. But Bush adds a twist. It may be that some multilateral deals only really work when one of the critical parties to them threatens to abandon them and go it alone. Call it "unilateral multilateralism". Thatcher's relationship with the E.U., was rather like this. And Bush's continued insistence that the U.S. reserves the right in the last resort to deal with Iraq by itself has, I think, been the single most important factor in forcing the U.N. to act. His unilateralism made multilateralism possible. And it also gave direction to the multilateralism, reminding the U.N. that it should be concerned with tangible results not just debates and resolutions. I doubt the U.N. is up to the task, but it is one of the ironies of the present moment that without Bush's threat to walk, the U.N. wouldn't even recognize the task in front of it. You know, he really is a lot smarter than his critics recognize. Which is, of course, fine by him.



There is a lot of economics at work here.

1. People act in what they perceive to be their best interests. As governments are established to serve somebody's best interests (not everybody begins with the same premises as the Declaration of Independence and the Constitution) "unilateralism," broadly understood, follows immediately.

2. Cooperation is more likely where there is mutual benefit. (Everyone who has been through one of my basic classes has heard this 2^(k-1) times for k large.) Multilateral agreements, therefore, enable each party to share in the gains from trade, if you will, made possible by the agreement. (That's not the same thing as the sum of individual interests, but I don't act in plays and Mr Sullivan probably hasn't read Paul Samuelson and Abraham Bergson on social welfare functions).

3. One cannot discuss sharing the gains from trade without some understanding of what one stands to lose by not sharing. This third point is somewhat more subtle and it has been the subject of an area of economics called game theory. Three elements are central. First is creating cooperation. "The problems in cooperation are detection of cheating, punishment, and restoring cooperation after punishment." Next comes commitment, where sometimes President Bush's strategy, "[C]ommit to a move first, and tell your opponent so he will respond in a certain way," is best, but sometimes the vicars of vacillation have the right idea: "wait to act as long as possible, to delay costs and maintain flexibility." Finally there is credibility: your response must be rational given the circumstances you're in. "A threat that is not credible is useless." A concept closely related to credibility is reputation: will you follow through on your threats. Mr Sullivan's complaint about the "muddled abdication" of the previous administration recognizes this point. Perhaps al-Qaeda, the Taliban, Saddam Hussein, (and the elderly delinquents in Teheran?) anticipated continued turning of the other cheek from the United States. With one relocated to Cuba and another in hiding, the bad actors remaining standing must update their expectations in light of new information, another point that keeps recurring in class notes.

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