Back in the summer of 2016, Illinois became the only U.S. state in the past 80 years to go an entire year without a full operating budget, according to Reuters. It reached that dubious milestone thanks to an epic negotiation impasse between Republican governor Bruce Rauner and the Democratic-controlled state legislature. The story of the negotiation failure suggests lessons to professional negotiators facing tough choices and hoping to avoid impasse.
An agenda and a condition
As Illinois politicians approached negotiations for the 2015 budget, the state faced a $1.6 billion budget shortfall for fiscal year 2015 and a $6 billion gap between falling income-tax rates and the price of maintaining government services at 2015 levels. Meanwhile, the state’s economy was contracting at a time when most other U.S. states were experiencing growth, according to an analysis by the Federal Reserve Bank of Philadelphia.
On June 25, 2015, the Illinois General Assembly passed a state budget that would have created a deficit of almost $4 billion. Rauner vetoed it and announced that he would not agree to raise taxes to balance the budget unless the legislature passed his signature “turnaround agenda,” a list of proposed business-friendly, union-weakening laws. According to Rauner, his agenda was needed to cut spending in Illinois and overhaul the state’s pension system. But Democrats, led by Michael Madigan, the longtime speaker of the Illinois House of Representatives, rejected the governor’s demands, saying they were unrelated to the budget talks.
The threat of revolt
For most of the next year, Rauner refused to negotiate, saying he would do so only when Democrats agreed to his turnaround agenda. The resulting impasse and lack of budget led about one million Illinoisans to lose vital services, including mental health care and cancer screenings and caused the layoffs of thousands of workers. The state limped through the year on court-ordered spending and stopgap appropriations.
The threat of voters’ wrath in the November elections motivated Rauner and the legislators to hammer out a temporary compromise. On June 30, Rauner approved a stopgap plan designed to keep the state government operating for six months. The Chicago Tribune called the deal a “duck-and-cover” for Illinois politicians. “Only in Illinois’ bizarre universe of astonishing political ineptitude does this budget vote qualify as an achievement,” wrote the Tribune’s editorial board.
3 keys to avoiding a protracted impasse
Here are three negotiating techniques that professional negotiators can use to build trust and break through an impasse in adversarial bargaining:
- Adopt a gain frame.
Negotiations over costs and losses, such as a mortgage foreclosure, a job termination, or a budget shortfall, are generally more competitive and challenging than those involving benefits and assets, such as a home purchase, a new job, or a budget surplus.
How can you avoid approaching negotiations over losses with a rigid attitude? Try to identify any benefits that may accompany the burdens you anticipate, recommend University of Utah professor Harris Sondak and Columbia Business School professor Adam D. Galinsky, and encourage your counterpart to do the same. A tighter operating budget offers opportunities to exercise greater fiscal restraint, for example.
- Think multiple steps ahead.
When you are faced with someone’s unappealing offer or position, think multiple steps ahead before you refuse to negotiate or compromise unless the other party meets your conditions. Firm positions and rejections can easily lead to a protracted impasse. Instead of taking a tough stance, top negotiators educate their counterparts about what aspects of their offers are most palatable and think about what they might ask for in return for concessions.
- Keep talking.
Over the course of a year, Illinois politicians failed to meet at the negotiating table even as the stalemate had painful repercussions for the state’s residents and reputation.
Individuals and organizations sometimes refuse to negotiate in the hope that a counterpart will back down as the costs inflicted by an impasse mount. What’s often overlooked is that impasse damages both sides. The more time passes, the deeper both parties dig in their heels. If you do manage to get back to the negotiating table, the ill will that accumulated during the impasse will make talks all the more challenging.
Negotiation is usually a much more promising means of resolving a conflict and ending an impasse than refusing to negotiate. When talks have reached an impasse, try building trust and goodwill by proposing that you negotiate relatively minor issues first.
Which techniques have helped you break through a negotiation impasse? Share your story in the comments.
Adapted from an article in the October 2016 issue of the Negotiation Briefings newsletter, published by the Program on Negotiation at Harvard Law School.