5. Belling the cat
In the children’s story about belling the cat, the mice decide that life would be
much safer if the cat were stuck with a bell around its neck. The problem is,
who will risk his life to bell the cat?
This is a problem for both mice and men. How can relatively small
armies of occupying powers or tyrants control very large populations for long
periods? Why is a planeload of people powerless before a single hijacker with
a gun? In both cases, a simultaneous move by the masses stands a very good
chance of success. But the communication and coo¨rdination required for such
action is difficult, and the oppressors, knowing the power of the masses, take
special steps to keep it difficult. When the people must act individually and
hope that the momentum will build up, the question arises, “Who is going to
be the first?” Such a leader will pay a very high cost — possibly his life. His
reward may be posthumous glory or gratitude. There are people who are
moved by considerations of duty or honour, but most find the costs exceed the
benefits.
Khrushchev first denounced Stalin’s purges at the Soviet Communist
Party’s 20th Congress. After his dramatic speech, someone in the audience
shouted out, asking what Khrushchev had been doing at the time.
Khrushchev responded by asking the questioner to please stand up and
identify himself. The audience remained silent. Khrushchev replied: “That’s
what I did, too.”
In a sense, we have seen these examples before. They are just a
Prisoner’s Dilemma with more than two people; one might call this the
hostages’ dilemma. Here we want to use this dilemma to make a different
point — namely, the frequent superiority of punishment over reward. The
dictator might keep the populace peaceful by providing it material and even
spiritual comforts, but this can be a very costly proposition. Oppression and
terror relying on the Hostages’ Dilemma can be a much cheaper alternative.
There are many examples of this principle. In a large taxi fleet, cars
are often assigned to drivers by a dispatcher. The fleet has some good cars
and some clunkers, The dispatcher can use his assignment power to extract a
small bribe from each of the drivers. Any driver who refuses to pay is sure to
get a clunker, while those who coo¨perate are given the luck of the draw from
the remainder.* The dispatcher gets rich, and the drivers as a group end up
with the same set of cabs that they would have if no one used bribery. If the
drivers acted in collusion, they probably could stop this practice. The problem
lies in getting the movement organized. The point is not so much that the
dispatcher can reward those who bribe him, but that he can punish severely
those who don’t.
A similar story can be told about evicting tenants from rent-controlled
apartments. If someone buys such a building in New York, she has the right
to evict one tenant so as to be able to live in her own building. But this
translates into a power to clear the whole. A new landlord can try the
following argument with the tenant in Apartment 1A: “I have the right to
live in my building. Therefore, I plan to evict you and move into your
apartment. But if you coo¨perate and leave voluntarily, then I will reward you
with $5,000.” This is a token amount in relation to the value of the rentcontrolled
apartment (although it still buys a few subway tokens in New
York). Faced with the choice of eviction with $5,000 or eviction without
$5,000, the tenant takes the money and runs. The landlord then offers the
same deal to the tenant in 1B, and so on.
The United Auto Workers have a similar advantage when they
negotiate with the U.S. auto manufacturers sequentially. A strike against
Ford alone puts it at particular disadvantage when General Motors and
Chrysler continue to operate; therefore Ford is more likely to settle quickly on
terms favorable to the Union. Such a strike is also less costly to the Union as
only one third of their members are out. After winning against Ford, the
Union takes on GM and then Chrysler, using each previous success as
precedent and fuel for their fire. The Japanese coal buyers use similar tactics
every year when buying from Australian coal mines. In contrast, Japanese
union incentives work the other way, since they are organized by company
and have more profit sharing. If the Toyota unions strike, their members’
incomes suffer along with Toyota’s profits, and they gain nothing from the
precedent effect.
We are not saying that any or all of these are good outcomes or
desirable policies. In some cases there may be compelling arguments for
trying to prevent the kinds of results we have described. But to do so
effectively, one has to understand the mechanism by which the problem arose
in the first place namely, an “accordion effect,” where each fold pushes or pulls
the next. This phenomenon arises again and again; but it can be countered.