November 21, 2017 Articles

“The Art of the Deal”: Exploring President Trump’s Negotiation Style

By Joan Stearns Johnsen

“The art of the deal” is President Trump’s touted personal formula for winning at negotiation. President Trump campaigned as the consummate negotiator singularly qualified to “fix it.” Some say it is precisely his business and negotiation acumen that qualify him for the presidency. Others disagree, citing his numerous business bankruptcies and his legislative and diplomatic failures to demonstrate that the emperor wears no clothes. Rather than judge his negotiation ability as either good or bad, this article seeks to explore his style of negotiation from a theoretical standpoint. In other words, based on his first 10 months in office, what kind of negotiator is President Donald J. Trump?

Most people gravitate to the style that best suits their personality. Some people are naturally collaborative. Others, called avoidant, eschew the conflict and the gamesmanship of the back and forth. (This discussion of style is based largely from definitions contained in the book Bargaining for Advantage by Professor G. Richard Shell of the Wharton School.) Still others—compromisers or accommodators—consider the needs of their adversary in working toward agreement. And then there are the competitive negotiators. Competitive negotiators view negotiation as a win/loss paradigm. And competitive negotiators like to win. The competitive style is the polar opposite of the win/win or interest-based bargaining approach. President Trump would appear to be a purely competitive negotiator.

Not everyone uses the same style all the time. Some change unconsciously and others adapt strategically. Strategic negotiators are skilled at adapting their negotiation style to suit the situation. They will consider the relative leverage and power balance of all concerned and adapt their approach accordingly. Strategic negotiators adjust to accommodate the particular type of negotiation—whether the negotiation is as a “principal” on their own behalf (e.g., for a salary) or as an “agent” (e.g., on behalf of a client). Others are less flexible. President Trump’s style thus far has been unchanging. He is consistently competitive regardless of the situation, his leverage, or his counterparty’s approach.

A competitive bargainer tends to lead off with somewhat extreme positions and requires his adversary to make significant concessions. In this way, the competitive bargainer can claim victory. The competitive bargainer conveys strength and gets to victory or impasse quickly. When the competitive bargainer has leverage, he tends to use that leverage as a cudgel to force his adversary to make concessions. This is apparent in Trump’s negotiations with his campaign workers. Trump weaponized his dispute resolution clause by utilizing a unilateral arbitration clause—i.e., his employees had to arbitrate while he could require them to litigate in court. His campaign workers were required to waive their right to a jury, to appeals, and to depositions. Trump, on the other hand, could sue his employees in court and subject them to invasive and expensive depositions and appeals.

As president, President Trump has only enhanced his superior power and leverage. Yet his approach has not consistently produced the desired deals. This is true because even though there are advantages to a purely competitive approach, there are also disadvantages. For example, competitive bargainers take extreme positions. They tend to focus on winning rather than on the merits of the deal they are negotiating. They will prefer impasse to losing, even when the alternative is undesirable. When two competitive negotiators engage, neither wants to be the loser, and there is a greater likelihood that neither will capitulate and the negotiation will result in an impasse.

This is the situation presented by President Trump’s negotiation with Kim Jong-un of North Korea. Clearly, the alternative—nuclear war—is undesirable for both. President Trump has the greater leverage. It is uncontroverted that the United States ultimately would win any nuclear engagement. But for each leader, the need to prevail over his adversary appears paramount. Neither is willing to accept defeat. This sort of a negotiation is a purely win/lose exercise. It is a high stakes game of chicken. Capitulating, in the eyes of these negotiators, means losing status and respect. Both continue to hurl insults at one another in an attempt to force the other to back down. Even though both presumably would prefer to avoid nuclear war, conceding to the other is not currently in either party’s negotiation vocabulary. The inevitable result is impasse (or worse), unless one or both leaders adjust their negotiation style.

A powerful currency in any negotiation is trust and rapport. When there is trust, mutual respect, and rapport, a negotiator may make representations of fact or of future conduct and be believed. He or she may call on the strength of that mutual respect as a means of breaking impasse and returning to the bargaining table, or in order to obtain fairness in a future negotiation when the balance of power has shifted. When relying on power and leverage in a “one-off” negotiation, rapport and trust may be unnecessary. The aggressively competitive bargainer may successfully use his power to prevail. However, very few negotiations are one-off, and good reputations, relationships, and trustworthiness—once destroyed—are very difficult to resurrect.

President Trump has shown minimal focus on building rapport even among those in his own party or administration. Instead, he has repeatedly questioned the good faith, competence, or intelligence of individuals whose agreement and cooperation he may at some point need (such as Senate Majority Leader Mitch McConnell, Senator John McCain, Senator Bob Corker, Secretary of State Rex Tillerson, or Attorney General Jeff Sessions). While these gentlemen may refrain from retaliating publicly, the approach President Trump has taken is unlikely to engender good will. He appears to rely exclusively on his leverage as a means to force compliance. Should the leverage or the power shift, there may not be much good will to draw upon. Based on how these individuals view their own leverage at any given point and in any given negotiation, they may be more willing to use that leverage than they otherwise might have been.

A reputation for trustworthiness is equally important for an effective negotiator. President Trump as an aggressively competitive bargainer has not sought to build a reputation as a trustworthy adversary. He has reneged on the Paris Climate Accord and the Trans-Pacific Partnership. He has threatened to withdraw from NATO, UNESCO, and NAFTA. Further, the facts asserted by President Trump in support of his recent decision not to certify Iran’s compliance with the Iran Nuclear Agreement have been publicly challenged. As the Iranian foreign minister Mohammad Javad Zarif observed on CBS’s Face the Nation: “[T]he United States is a permanent member of the Security Council. And if it’s not going to uphold a resolution, that not only it voted for but it sponsored, then the credibility of the institution that the United States considers to be very important would be at stake. Nobody else will trust any U.S. administration to engage in any long-term negotiation because . . . the duration of any commitment from now on with any U.S. administration would be the remainder of the term of that president.”

In the first 10 months of his presidency, President Trump’s negotiation style has consistently been that of a competitive bargainer. This style can be successful in the right circumstances, especially when one has the better bargaining position (e.g., his obtaining the advantage over his campaign workers by requiring a unilateral arbitration clause). However, there are risks to using this style (e.g., in recent exchanges with North Korea), and it is not the most effective technique in all circumstances. Whether President Trump will adjust his negotiation style to fit future negotiations is a question still to be answered.

 

Joan Stearns Johnsen is a legal skills professor at the University of Florida Levin College of Law; a practicing mediator, arbitrator, and negotiation trainer; and vice chair of the American Bar Association Section of Dispute Resolution.


Copyright © 2018, American Bar Association. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or downloaded or stored in an electronic database or retrieval system without the express written consent of the American Bar Association. The views expressed in this article are those of the author(s) and do not necessarily reflect the positions or policies of the American Bar Association, the Section of Litigation, this committee, or the employer(s) of the author(s).