The Obama Administration has taken a non-confrontational approach to relations with China for the first half of its term – and circumstances at home and abroad make it unlikely that it will become more assertive any time soon. The problem is not that the US seems to be negotiating from a position of weakness – the problem is that it is so woefully incompetent at it. Home and abroad, this administration is having a hard time shedding its elitist manners even when the reality on the ground is clearly bad and getting worse.
Chinese, on the other hand, are big fans at winning from weakness – Lao Tzu and Sun Tzu (heavyweights of philosophy, leadership and military management) wrote extensively about it, and some Chinese still like to tell themselves that they alone keep the revolutionary flame burning. Chinese appreciate the extra attention and patience required to negotiate effectively from weakness – and I don’t think they’re impressed by shortcuts or ham-fisted delivery. That’s probably why Obama was treated like an unwelcome houseguest when he was here last.
If the Obama administration is going to continue with its non-confrontational, “we’ll delay the report if they want us to” style of negotiation with the Chinese, then they are going to have to get better at it, fast. Right now Obama looks too much like what he really is – the good-natured, book-smart preppy who has wandered out of his depth. What we need is a canny, street-smart deal-maker who can pull out some wins, pretty or not.
Here is a list of tactical ides for the Obama Administration and anyone else new at negotiating from weakness.
2. Learn to niche. Winners don’t try to buy or bully market leadership. They do more with less and look for the overlooked. Find those toe-holds and exploit opportunities.
3. Dignity, yes – but no hubris. To deny your relative position is to neutralize some of your most potent weapons. It’s OK to be a LITTLE proud about how humble you’ve become, but not quite as much as the Brits in the 20th century. On the other hand, it is best to ratchet down the spending in a proactive way. Start by giving up the expensive mantels of leadership that you can’t afford anymore. Giving more power to China and emerging markets in the World Bank was a good start. Moving the UN to Shanghai will show them that we are serious. Likewise, on-the-ground Western negotiators are going to hear more and more proposals that involve Chinese partners taking the lead in decision-making and management.
4. Work the network. Build coalitions. Don’t ignore the small or weak – they can cause huge flashes. Secretary Clinton seems to be the only one on Team Obama who understands this. European negotiators in China get better grades here than their American counterparts.
5. Choose battles carefully. How did the RMB:USD exchange rate become the central issue of US-China relations? It’s bound to end badly – for the US. Winners from weakness have to keep their conflicts winnable but still boring, forgettable. Geithner & Co. picked a highly visible, intractable issue as the centerpiece of the China policy.
6. Work to influence the agenda in a meaningful way. See #5. Trying to move Beijing on currency in this economic environment was ludicrous. Winning negotiators should have a much more diversified, integrated goal system. Give yourself plenty of options and alternatives. A broader agenda means more opportunity for niche gains. A narrow agenda makes it harder to win deal points. Americans are the only negotiators who think that they can alter the agenda at will.
7. Go for incremental gains. Win on the margins – lots of singles and doubles. Winners can’t try for home runs all the time. The US plans to set the course at the Seoul G20 meeting with some new global initiatives. Hopefully they will also have some quiet back-channel negotiations going on, or they will leave with nothing. Winning from weakness means a reduced goal system and a willingness to accept partial wins.
8. Stability is not necessarily your friend. The status quo only serves leaders. You’re a guerilla force now. Be disruptive when it serves you. This is another problem with Team Obama’s approach to China – and it might be yours as well. Working hard to maintain the status quo makes sense for leaders and those facing retirement. To win from weakness, you may need to take advantage of sudden shifts and new opportunities.
9. Learn to eat bitterness. One of the most disturbing features of the Obama administration is its complete inability to make tough sacrifices. Team Obama can’t seem to learn from its mistakes in China because it can’t accept that anything is wrong. Winners from weakness know that you may have to ride out some tough times before you can win the day. No pain, no gain.
10. The Victim Card. Don’t overplay it. Once they’ve heard this a few times, it loses impact. But one of the advantages of a weakened negotiating position is the appeal to decency. China has been working this one (Opium, Occupations, Invasions, etc.) for so long that they are having trouble dialing it down now – it’s starting to sound humorous.