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If you haven't been following FiveThirtyEight.com since the election, you should really check out today's post: Obama's Price Is Right Negotiating Strategy.

The logical reasoning behind this analysis proves that Nate Silver's talents go well beyond just polling. He also understands the legislative process, political motivations, and the art of negotiating.  

A few excerpts below the fold but please do yourself a favor and read the full article.

If you're Mitch McConnell or Mary Landireu or Bob Corker and you see that John Kerry thinks that $800 billion is too little -- well then, 'gal darn it, this Obama fella must be doing something right.

Imagine instead that Obama had started out at $1.3 trillion, assuming that the conservatives in the Senate would negotiate him down. Then we have some big, old-fashioned brouhaha about economic philosophy, with Obama and the Senate Democrats lining up against the Blue Dogs and the Republicans. This strikes me as a considerably more dangerous negotiation, because while the Senate Democrats can set the ceiling if Obama starts too low, there is nobody really there to set the floor if he starts too high -- the Republicans have no real imperative to compromise on any stimulus.

I call this a Price is Right negotiating strategy. When bidding on an item on The Price is Right, you want to come as close as possible to the item's price without going over. But if you do go over, your bid is invalidated. Thus, it is worse to bid $1 too much than $100 too little. Here, analogously, the risks of overbidding seem to be considerably greater to Obama than the risks of underbidding.

Until Obama takes the Oath of Office and actually stars doing stuff, it is easy for any of us to filter his actions through our preferred narrative about the incoming administration. Is this all some clever jujitsu negotiating ploy from the Boy Genius Campaign? Or is it a sign that the Obama administration just doesn't get it, fetishizes centrism and bipartisanship, and will need constant babysitting from the noble netroots? Neither characterization is liable to be entirely accurate, of course.

Update: This is the obligatory "thanks for the rec list" update. Of course, as somebody noted in the comments, there isn't much original thought here but the conversations in the comments are interesting. I'm shamelessly accepting all tips on behalf of Nate Silver but please be sure to also go to fivethirtyeight.com and give him his due directly.

Originally posted to bradams on Fri Jan 09, 2009 at 03:46 PM PST.

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