Wednesday, June 13, 2007

Of Losses, Gains, and Winning


I’ve recently encountered a dilemma. In my apartment complex there are rules regarding what sorts of things can be out on the public areas of the tenets’ balconies. The property manager asked me to remove my grill from this balcony for reasons extending from the terms in my lease agreement. Being the law- and rules-abiding person that I am I promptly removed the grill from the balcony and placed it inside my apartment. In the days following I began to notice that others still had their grills outside their apartments in the same fashion that mine was. Furthermore one of my neighbors had their bicycles in a precarious position that has always been in the way of me, especially when I would be bringing something like grocery bags or a large package up the stairs. To my dismay I perceived this as a loss for myself and a gain for others.

This phenomenon has, in fact, been quantified by psychologists. One person’s loss must be made up by a gain of 2.5 times that loss in order to get over the loss, perceived or real. In other words, people are more displeased by a loss than they are over a comparable gain: In America, at least, we typically need to offset an unexpected loss by a gain of 2.5 times that loss. In my example above I was particularly observant of the plight of those around me after my loss was realized looking to see if the loss was a shared one. I fully expect the enforcement of laws to be fair and equitable in their enforcement. Not seeing this, my perception was that the loss was unbalanced and unfair. Of course, life isn’t fair, but this doesn’t preclude the quantifiable perception of loss.

Take politics, for example. In American politics there are a finite number of ideologies: Conservative, liberal, libertarian, independent, so on and so forth. When their affiliated parties do not enact the laws and policies which they think will improve society frustration is often had. Take the polarizing issues of our day: The War on Terrorism, immigration, abortion—they polarize the American public largely because the politicians are not enacting laws that are congruent with their belief structure and, in their frustration, can allow irrational actions to attack others in differing political affiliations or otherwise do things which tarnish the name and image of their party.

However, every change comes at a price. Improving something for someone will often cause a loss for someone else. Hybrid cars are a big thing right now, allowing for tax credits for those individuals willing and wishing to come up with the tens of thousands of dollars for them. These tax credits, however, come at a price. This “credit” actually becomes a redistribution of taxes in that it needs to be financed through other people being taxed for you to have that credit.

Economists call these “zero-sum games” in which the total net benefit to all of the interacting individuals in the situation adds to zero; each individual only benefits at the expense of others. This is the very nature of tax and economic legislation and, as it turns out, a common theme in our lives, thus the adage “life is not fair,” other people’s gains often come at the expense of our own.

How do we get past this paradigm and make the world a better place? Crafting classic “win-win” scenarios in our interactions with others will shatter this classic paradigm and make things better for everyone else. Win-win games often start with the self-talk phrase “I want to win and I want you to win too. The easiest and often most effective means of doing this are for you to look at the underlying needs of the situation. By addressing each party’s underlying needs allows you the opportunity to craft solutions acknowledging and valuing those needs rather than denying them. Even when the result isn’t necessarily what everyone would have ideally wanted the process that goes into achieving the result will make each party feel differently about the outcome: Typical results are achieved through simple quantitative processes, such as the zero-sum game; qualitative improvements are made with qualitative improvements in the very process which produces the result.

The changing of this process requires the redirection of your energy. Instead of asking yourself “which is the best solution for me?” replace it with “which is the best solution for you?” Instead of asking yourself “what is my real need here?” ask “what is your real need here?” Instead of making a self-directed value judgment or envisioning a result that you want focus on the value judgment of the other or the envisioning the result of the other person’s desired results.

If you do not know the answers to these questions…perhaps you need to get to know the person better.

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