The Trump administration demanded funding of its border wall as part of a deal to keep the government open, proposed a huge cut in taxes on businesses<br />that would reduce government revenue by trillions, and leaked plans to abandon the North American Free Trade Agreement to try to force Canada and Mexico to agree to better conditions.<br />“The benefit of starting aggressively is that if a deal is reached, it is likely to be more advantageous to you,” said Deepak Malhotra, a professor at Harvard Business School<br />and author of “Negotiating the Impossible.” “But there are also many risks, and these risks are much greater in politics.”<br />In particular, staking out an extreme position can very well shut down any further negotiating.<br />In Mr. Trump’s 1987 negotiation over buying an airplane, staking out an extreme offer carried minimal risk<br />and probably resulted in his getting a better price than if he had been less aggressive.<br />He sensed that the seller of the Boeing 727 was desperate, so he first offered a mere $5 million, “which was obviously ridiculously<br />low,” he wrote in “Art of the Deal.” He boasts of buying the plane, worth $30 million new, for just $8 million.<br />Think of a bluff and a lowball offer as tools that are often used in tandem — any time someone makes an extreme offer<br />but is either explicitly or implicitly lying about what will happen if it is not accepted.<br />“In many years of teaching negotiations, I’ve seen many people becoming enthralled with the apparent<br />power of making extreme first offers,” said Daniel Ames, a professor at Columbia Business School.<br />“Aggressive offers make it hard for parties to save face or declare victory later in the negotiation process —<br />and this is especially crucial in politics,” Mr. Malhotra said.
