Contents
A threat works only if the other side believes it will be carried out. But many threats are empty because carrying them out would harm the one making the threat. The air traffic controllers of 1981 were counting on exactly that: without us, they thought, air traffic will grind to a halt, so the government will give in. Ronald Reagan upset this calculation. The case shows what Thomas C. Schelling means by Credible Commitment.
A strike the law forbids
Situation
The air traffic controllers’ union, PATCO, has been negotiating with the federal government since February 1981. In June, the Federal Aviation Administration (FAA) offers a three-year contract with pay raises totaling 11.4%. PATCO rejects it because it provides neither a shorter workweek nor earlier retirement. On the morning of August 3, 1981, around 13,000 controllers walk off the job. As federal employees, they may organize and negotiate, but a federal law forbids them to strike. The strike is therefore illegal. The twist: PATCO had backed Reagan in the 1980 election campaign.
Link to the principle
The union is betting that being irreplaceable gives it leverage. It believes the government cannot afford the outage. In doing so, it confronts Reagan with the question of whether his administration enforces its own rules or whether laws are negotiable if the pressure is great enough.
The ultimatum
Situation
That same day, Reagan appears before the press. He declares the strike illegal and sets a 48-hour deadline: anyone who has not returned to work by then will lose their job. With that, he has committed himself publicly, in front of the whole country.
Link to the principle
A public commitment is the first building block of credible commitment. If you set a deadline in full view of everyone, you can hardly let it pass without losing face. Reagan makes giving in costly for himself. That is precisely what makes the threat believable.
The threat comes true
Situation
On August 5, 1981, the government fires 11,345 controllers who have not returned. They are banned from federal service for life. Supervisors, controllers who did not strike and military controllers keep operations going; at first, about half of the flights can take place. On October 22, 1981, PATCO loses its recognition as a union.
Link to the principle
Here the second building block becomes visible: the government can also carry out its threat, because air traffic keeps running without the strikers, if only on a limited basis. No one believes a threat whose execution would ruin you. A threat for which you have a plan B, on the other hand, is very believable. The controllers had overestimated how irreplaceable they were.
A signal beyond the strike
Situation
The firings become a turning point in American labor relations. Many see them as a sign of the declining political influence of the unions. Only in August 1993 does President Bill Clinton lift the ban on rehiring the fired controllers in federal service.
Link to the principle
Commitment works not only in a single conflict. Once you have shown that you carry out your threats, your next threat will be taken seriously. Reputation becomes capital. Reagan paid a high price, but he gained credibility for many later negotiations.
The flip side
Situation
Firing more than 11,000 skilled workers has consequences. The FAA has to train new controllers for years. The role of unions in the public sector remains controversial in the United States to this day.
Link to the principle
Commitment rules out compromises, including good ones. If you commit yourself, you give up the possibility of wisely giving in later. That is why it is a powerful but costly tool that you should use only if you can bear the consequences.
Key takeaways
Key lessons
- Threaten only what you can actually carry out.
- Commit yourself publicly if you want people to believe you.
- Prepare to follow through before you voice the threat.
- Remember that every threat you carry out shapes your reputation for later.
- Count the cost: commitment also takes good compromises away from you.
Summary
In August 1981, around 13,000 air traffic controllers went on strike, even though they were not allowed to, and counted on the government giving in. Ronald Reagan committed himself publicly to an ultimatum, was able to rely on emergency operations and fired more than 11,000 strikers. With that, his threat came true and his future threats became credible. The case shows both the power and the price of credible commitment.
Sources
- Thomas C. Schelling: The Strategy of Conflict. Cambridge (Mass.): Harvard University Press 1960.
