Playing Games Seriously

While walking home this afternoon, a NYT headline flashed on my watch face: “Merkel Reverses Long-Held Stance on Migrants in Bid to Save Her Government.” In part, the headline caught my attention because I had just been prepping a presentation group slated next Monday to talk about Game Theory in economics.

Game Theory — aka rational choice theory — assumes that every negotiation consists of a set of stated or understood rules to which parities tacitly agree, parties who know how to play the game, and identifiable costs and benefits associated with different outcomes. The classic game is played between two independent nations, but can be played between, say, the monopolistic industry dominating a city (Player 1) and the city’s employees/citizens (Player 2). So, as I was walking home, I got to thinking: what is this game? What are its rules? And what are the costs and benefits?

Is the game: Republican EU? Democratic EU? Divided EU? What is the game?

The rules: are the rules those that govern republics? Are they rules that govern democracies? Or might they be rules that govern isolated communities? What are the rules?

Finally, what are the costs and/or benefits? If our game is a republican game, then benefits arise from the broadest, most egalitarian distribution of wealth: res publica. If our game is a democratic game, then benefits arise when the majority dictates policy to the minority? And if it is a game of isolated, integral identities, then benefits arise from purity.

The game gets interesting when players are playing different games, with different rules, with qualitatively different outcomes. The games of republics, democracies, and ethnic or national purity are sufficiently different that it is difficult to imagine any outcome acceptable to all parties. (I could include other players — e.g., radical republicans (“Jacobins”) or radical democrats (“anarchists”), but they are, at best, minor players, or, at worst, non-players in this round.)

Which leads me to Chancellor Merkel’s announcement. Let us assume that she was playing a republican game. In that game, winning consists of distributing wealth broadly enough to generate broad participation by equally qualified participants: the text-book definition of republican. Her opponents, by contrast, believed themselves to be playing a game of democracy, at best, and nationalism, at worst — but, in any case, leveraging democracy on behalf of nationalism.

The best outcome from the democratic-nationalist front would be the elimination of the republican player. This means that, by shifting ground, Chancellor Merkel “wins” by denying the democratic-nationalist front its optimum outcome; but “loses” by affirming, in principle, the validity of the democratic-nationalist principle.

The question we pose to Chancellor Merkel, then, is: does Chancellor Merkel believe that by temporizing she can win breathing room to ultimately win? Or is she only interested now in minimizing losses? And, if she is minimizing losses, how does this game end?

The question we pose to the democratic-nationalist front is: is her adoption of your principles sufficient to satisfy your aims? Or will your base now hold you more dearly to a full victory?

If the former, then we may still be able to avoid 1932. If the latter, then 1932 should be visible already on the horizon.

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