When bartering, the seller will start higher than the price for which he intends to sell his product. That way, when the seller agrees to lower the price, the consumer feels as though he got a good deal, even though he might have been ripped off (attention tourists in Egypt…). This is pretty standard practice since bartering and bargaining were first established by the renowned economist known as Uhg, who lived in a cave thousands of years ago. Despite its age, this principle has withstood the test of time; the main idea still holds true – unless the seller doesn’t actually want to sell.
In political bargaining, it seems as though Israeli PM Netanyahu either skipped the classes on early economic models at MIT and Harvard or that he simply has no intention of extending the settlement freeze.
It came out yesterday that the Palestinian delegation had rejected an offer from Netanyahu that would have extended the partial and ineffective settlement freeze an entire two months (perhaps three) in exchange for Palestinian recognition of Israel as a Jewish state. Let’s clarify. Netanyahu proposed the eternal recognition of Israel as a Jewish state, thus permanently undermining the Palestinian refugee right of return in exchange for 2-3 months of settlement construction slowdown (not including East Jerusalem).
[tweetmeme] Let’s clarify further. The proposal was a trade in which the Palestinians would forever concede what many hold to be the most sacred right in exchange for Netanyahu not implementing a settlement freeze, but promising to discuss it with his predominantly settler cabinet.
In other words, Netanyahu offered nothing in exchange for the right of return.
Akiva Eldar called Netanyahu’s proposal “Judaism for sale” and correctly noted that the Israeli PM was doing no more than offering to play Dr. Kevorkian to Palestinian President Abbas’ struggling political life. But Eldar is incorrect. Judaism is not for sale here. With a sale both sides receive something; this would be going to a garage sale and picking up a priceless artifact in the “Free” bin.
What is particularly shocking is that Netanyahu is trying to hoodwink the Palestinians while concurrently passing a racist loyalty oath law (one that attempts to further distance Palestinians from their homes in Israel) and accepting an outrageously extravagant package of US and Palestinian incentives. The sack of carrots offered by US President Obama includes a complete contradiction of 43 years of US policy (a promise to not demand more settlement freezes undermines traditional US opposition to the illegal settlements) and a complete disregard for Palestinian participation (unilateral American acceptance of long-term Israeli military in the Jordan Valley makes “it appear[s] almost as if the Palestinians have no role in this peace process.”)
Fortunately, Palestinian negotiators rejected the proposal out of hand – something Netanyahu must have predicted. As I wrote earlier, it appears likely that the demand that Palestine recognize Israeli self-definition is no more than a ploy to throw mud at the Palestinian negotiating team by painting them as rejectionists. Netanyahu’s offer to exchange something of immense strategic worth for something that is temporary, partial and completely reversible adds credence to this theory that Netanyahu is a peace-maker in rhetoric only.
The key to bargaining is to start high, but not so high that the buyer walks away. The Israeli Prime Minister, by suggesting the Right of Return as a price, clearly has no intention of selling a settlement freeze to the Palestinians. Rather this ploy is aimed at not only rubbing Israeli political domination and impunity in the face of the Palestinians, but also to emphasize false and hallow Israeli peace overtures.
Photo from Barter Arbitrage