You Don't Negotiate with Terrorists: The Irrational Adversary Is Vermin

In one of the first complex disputes I handled, we offered the other side a settlement that would have left them better off than a court was likely to. My client was willing to pay more than he was realistically exposed to, just to put the matter behind him. The other side would have got an above-average result and saved the cost of further hearings. They refused. And went further: they answered with an amended claim adding new and far more aggressive demands. After five years, two appeals and two extraordinary appeals to the Supreme Court (dovolání), it was over, and the other side ended up with less than we had offered at the start. Yet to this day they believe they won, because they "dragged us through the courts for all those years".

Disputes like this are not rare, and the classic Harvard school of negotiation has little to say about them. In my piece on psychology and tactics in legal disputes I discussed BATNA, principled negotiation and tactical empathy. All of these tools assume that the other side is a rational actor with some interests. What if that assumption fails, and the person across the table is willing to smash the chessboard against the wall just so you cannot finish the game?

¶ The Myth of the Rational Opponent

Standard negotiation theory, from Roger Fisher and William Ury to Robert Mnookin, tacitly assumes a counterpart who more or less maximises expected utility. They respond to incentives: offer more and they give ground, raise the pressure and they start talking. Experiments have repeatedly undermined this assumption.

The best known is Werner Güth and colleagues' experiment with the ultimatum game (Güth, Schmittberger & Schwarze, 1982). One player receives a sum of money and offers the other any share of it. The second player either accepts, in which case both keep their shares, or rejects, in which case neither gets anything. A rational player should accept anything above zero, since a single coin beats nothing. In reality, people in industrialised countries reject offers below 20% roughly 40 to 60% of the time. They often give up their own gain just to punish someone they feel has treated them unfairly.

Henrich, Boyd, Bowles and colleagues showed that this is not just a quirk of Western students. They ran the same games in fifteen small-scale societies in twelve countries across five continents (Henrich et al., 2001). The purely selfish player model failed in every one of them. But willingness to punish varied far more between societies than anyone had expected. Among three South American groups (the Achuar, Aché and Tsimane), not a single offer was rejected, even though almost half of the Tsimane offers were 30% or less. The Au and Gnau of Papua New Guinea, by contrast, rejected unfairly low offers and offers above half the pie equally often. So people often punish unfairness at their own expense. How strongly depends on the norms of the society they come from.

Ernst Fehr and Simon Gächter studied this under the name altruistic punishment: people bear costs in order to punish those who fail to cooperate (Fehr & Gächter, 2002). Evolutionary models show how such willingness could persist even in large groups under conditions resembling cultural evolution in small-scale societies (Boyd, Gintis, Bowles & Richerson, 2003). So if the other side sees you as the one who broke the contract, cheated them or humiliated them, they will be willing to punish you even at their own expense. And they may reject a settlement that would materially benefit them, simply because they do not want to hand you a win.

¶ Schelling: Why It Pays to Look Crazy

Thomas Schelling showed how irrationality can be a bargaining advantage in The Strategy of Conflict (1960). He received the Nobel Prize in Economics in 2005.

At its core is the commitment problem. If I want the other side to back down, I have to convince them that I will not. But if I am rational, they know I will back down as soon as carrying on costs me more than it can bring. The only credible commitment is therefore one that rules out retreat in advance: a burnt bridge, or a position declared so publicly that there is no climbing down from it. The classic image of this logic was popularised by Herman Kahn (On Escalation, 1965). Two drivers speed towards each other, and the winner is the one who first throws the steering wheel out of the window. He can no longer swerve, so the other driver has to.

In a legal dispute, this explains behaviour that makes no economic sense. An opponent who acts "crazy" is throwing the steering wheel out of the window, and the message is: I'll keep going, whatever happens. If you swerve, they get more than they would by negotiating normally.

During the Cold War, Richard Nixon called this the madman theory. Scott Sagan and Jeremi Suri (2003) analysed how he tested it in October 1969 with a secret nuclear alert. The madness only has to be credible. Some people send that signal quite authentically, because they really are mad.

Game theory draws an uncomfortable conclusion from this: against someone who credibly shows they have nothing to lose, the rational move is to swerve. The practical question is when that is genuinely the case, and when the other side merely wants you to believe it is.

¶ Who We Face: The Psychology of the Destructive Opponent

The irrational opponent is not a single type, and each type calls for a different strategy. The best researched framework is the dark triad, described by Delroy Paulhus and Kevin Williams (2002):

• Narcissism: grandiosity, a need for admiration, a sense of entitlement. In a dispute, the narcissist hates losing face more than losing money and will keep playing for as long as they see a damaged image of themselves in the game.
• Machiavellianism: calculated manipulation and a readiness to deceive. The Machiavellian is functionally rational and can be negotiated with, but only if you keep checking everything they say.
• Subclinical psychopathy: a lack of empathy and guilt, with impulsiveness and risk-seeking. Robert Hare described it clinically (1993), Paul Babiak and Hare in the corporate world (2006), and Martha Stout in everyday life (2005). Such an opponent does not feel most of the psychological costs a dispute imposes on the rest of us, and the costs we add will not deter them.

Erin Buckels, Daniel Jones and Delroy Paulhus later showed in the laboratory that everyday sadism belongs alongside these three traits (Buckels, Jones & Paulhus, 2013). The extended framework is known as the dark tetrad. The sadist takes pleasure in other people's suffering. Economic pressure therefore will not deter them, because they are not counting their own gain but your pain, and the line "come back to the table or this will keep hurting" misses the mark. It helps more not to show that the dispute is costing you, and to limit contact.

In practice I also meet other profiles. A person with borderline personality traits changes position from one day to the next, so no strategy can be built on what they say. A person with paranoid traits reads routine correspondence as an attack; Aaron Beck (1999) described the cognitive basis of anger and hostility. And then there is the wounded hero: an otherwise ordinary personality so hurt by a particular event that the role of victim has become part of their self-image. Roy Baumeister (1997) shows that people who harm others often see themselves as the victims and use that to justify their aggression.

The typology is not a tool for diagnosing the other side; that is not a lawyer's job, and lawyers lack the means to do it. Its purpose is to stop you using the same strategy on everyone. What works on a narcissist, namely a chance to leave with dignity, does nothing to a sadist.

¶ The Escalation Spiral and Sunk Costs

Irrationality also develops over time. Many opponents who seem irrational today were not like that when the dispute began. Dean Pruitt and Jeffrey Rubin described the dynamics of escalation (1986; 2nd edition Rubin, Pruitt & Kim, 1994), and Friedrich Glasl captured similar logic in his nine-stage model (1980), which I discuss in the article on the psychology of the parties. In disputes I see four mechanisms above all:

• Reciprocal escalation: each side answers the last move one notch harder ("I was only reacting"), until someone deliberately steps in.
• Escalation of commitment: the sunk cost fallacy (Arkes & Blumer, 1985). The more the opponent has put into the dispute, the more they need to carry on, or the investment would have been wasted.
• Identity fusion: William Swann and colleagues described identity fusion, in which personal identity merges with a group so completely that a person is willing to act in extreme ways for it (Swann et al., 2012). I see a similar mechanism in disputes: once an opponent has fused with their position, giving up the position means giving up themselves.
• Moralisation: Linda Skitka and colleagues summarise evidence that convictions grounded in morality resist compromise more than purely practical ones (Skitka et al., 2021). Once an opponent frames their stance as a matter of justice, compromise feels like betrayal.

Together these produce an addiction to conflict: the other side has more reasons to continue than to stop, however the economic calculation turns out.

¶ Asymmetric Defence: What Can Legitimately Be Done

Military strategy, crisis negotiation and the sociology of conflict converge on a handful of recommendations that I call asymmetric defence. The principle behind them is not to play the game the opponent offers you, but a different one they are not prepared for.

1. Structural isolation. You channel all contact with the opponent through formal routes in which their destructive dynamic has nothing to feed on. In a dispute, this means using procedural formality, dropping informal communication, putting everything in writing and, where useful, dealing through a mediator, an expert or the court. The strategy is close to the first step William Ury calls "go to the balcony" in Getting Past No (1991): not reacting in the heat of the moment and looking at the negotiation as if from a balcony. Formal channels do the same thing institutionally.

2. Cost asymmetry. If the opponent is playing on your money, time and nerves, arrange the dispute so that every further move costs them more than it costs you. An interim measure or prompt enforcement proceedings change the cost structure, provided the legal conditions for them are met. This rarely brings a quick win, but it changes the economics of the fight. In my experience, an opponent betting on wearing you down loses appetite once they realise they are now carrying most of the costs.

An insolvency petition has no place here as a means of pressure. It makes sense only if the debtor really is insolvent. Where a creditor's petition manifestly seeks to abuse its rights at the debtor's expense, the court will reject it as manifestly unfounded and may fine the petitioner up to CZK 500,000, roughly EUR 20,000 (Section 128a of the Czech Insolvency Act). The petitioner is also liable for the damage and other harm caused by opening the proceedings, and in case of doubt is presumed to be at fault for the rejection (Section 147 of the Insolvency Act).

3. Tit-for-tat with forgiveness. Robert Axelrod (1984) showed that in the repeated prisoner's dilemma, the simple tit-for-tat strategy wins: you start by cooperating and then copy your opponent's last move. Later work by Martin Nowak and Karl Sigmund showed that in an environment full of mistakes, more generous variants do better: generous tit-for-tat, which occasionally forgives (1992), and Win-Stay, Lose-Shift, which can correct an error (1993). For a dispute, this means mirroring the opponent's toughness while leaving the door open to de-escalation, so that they do not have to fight their way through it. In a one-off game, however, tit-for-tat does not work. In a dispute that is clearly the parties' last interaction, the opponent has no reason to cooperate.

4. Changing the field. If the other side is playing destructively on one field, such as media pressure, personal attacks or parallel proceedings, the most effective response is often to neutralise that field and bring the dispute back to where procedural discipline applies. Whoever decides where the dispute takes place has a strong influence on who wins it.

5. Avoiding a head-on clash and letting the opponent tire. Judo and the Chinese military tradition share the advice to let a blow land on empty air. When an opponent pours enormous effort into a move meant to break you, you do not have to meet it head-on. Do not respond to provocative filings where procedure does not require it, and defend the line of the dispute that really matters to you. In my experience, everyone tires in a long dispute, even an opponent from the dark triad, and the only question is who tires first. Sun Tzu already notes in The Art of War that an army may be robbed of its spirit and a commander of his presence of mind (ch. 7).

¶ When to Walk Away, and Where the Limits Lie

Running through all of this is a question that lawyer and client must be able to ask together: when to leave the battlefield.

Robert Mnookin devoted a book to it, Bargaining with the Devil (2010). Before deciding, he advises going through both sides' interests and alternatives, the possible deals, the costs of negotiating and whether a deal can actually be implemented. Only then does he weigh the moral question. His answer to the question in the book's title fits into one sentence: "Not always, but more often than you feel like it."

I use three questions myself:

1. Is it converging? If the gap between positions keeps widening despite reasonable offers, standard negotiation is not working. That is not yet a reason to stop, but it is time to change tools.
2. Am I on my own? If other people are also urging the client to fight on for the wrong reasons, say another lawyer in the background or a manager who wants to win in front of the board, a settlement has little chance until that second bench clears.
3. What does carrying on cost, and what does ending it cost? It is not just about money. It is also about the client's time, health, family and ability to focus on their own work. The client pays the cost of carrying on continuously and out of everything; the cost of ending it is usually one-off.

An English saying puts it more briefly: "Don't wrestle with a pig. You both get dirty, and the pig likes it." The pig enjoys it and you don't, so it will outlast you.

Hard strategies also have an ethical limit. They are justified only where the standard approach has failed and the opponent's behaviour has moved them into irrational territory. Used against a rational opponent, the same tools are unjustified and professionally untenable. When a client asks whether they can now play the way the other side does, my answer is that they can change the field of play but must not adopt the other side's values. Whoever starts doing harm rather than protecting themselves loses both their ethical and their procedural standing, and their defence turns into revenge.

¶ Conclusion: When Harvard Isn't Enough

Over the years I have come to distinguish two kinds of dispute. In the first, rational actors face each other, and they care more about the outcome than about each other. There, Fisher, Ury and Mnookin work without reservation, and by my estimate such disputes are the majority, roughly four out of five.

In the second, the person on the other side is willing to destroy themselves just to drag you down with them, and has built their identity on fighting you. How many such disputes there are depends on the field; my estimate is five per cent of cases in some areas and a fifth in others. For these you need a different library: Schelling, Axelrod, Glasl, Pruitt and Rubin, and Mnookin.

A client who can ask what kind of dispute they are actually in has an advantage over anyone who applies one doctrine to everything. I explain why the legal route is not always the right one in The Lawyer as Illusionist, what game an irrational opponent usually plays in the piece on the four games played in court, and a practical view is offered in Not Every Battle Is Worth Fighting.

¶ Further Reading

• Arkes, H. R., & Blumer, C. (1985). The Psychology of Sunk Cost. Organizational Behavior and Human Decision Processes, 35(1), 124–140.
• Axelrod, R. (1984). The Evolution of Cooperation. Basic Books.
• Babiak, P., & Hare, R. D. (2006). Snakes in Suits: When Psychopaths Go to Work. ReganBooks (HarperCollins).
• Baumeister, R. F. (1997). Evil: Inside Human Cruelty and Aggression. W. H. Freeman.
• Beck, A. T. (1999). Prisoners of Hate: The Cognitive Basis of Anger, Hostility, and Violence. HarperCollins.
• Boyd, R., Gintis, H., Bowles, S., & Richerson, P. J. (2003). The Evolution of Altruistic Punishment. PNAS, 100(6), 3531–3535.
• Buckels, E. E., Jones, D. N., & Paulhus, D. L. (2013). Behavioral Confirmation of Everyday Sadism. Psychological Science, 24(11), 2201–2209.
• Fehr, E., & Gächter, S. (2002). Altruistic Punishment in Humans. Nature, 415(6868), 137–140.
• Glasl, F. (1980). Konfliktmanagement: Diagnose und Behandlung von Konflikten in Organisationen. Haupt / Verlag Freies Geistesleben.
• Güth, W., Schmittberger, R., & Schwarze, B. (1982). An Experimental Analysis of Ultimatum Bargaining. Journal of Economic Behavior & Organization, 3(4), 367–388.
• Hare, R. D. (1993). Without Conscience: The Disturbing World of the Psychopaths Among Us. Pocket Books.
• Henrich, J., Boyd, R., Bowles, S., Camerer, C., Fehr, E., Gintis, H., & McElreath, R. (2001). In Search of Homo Economicus: Behavioral Experiments in 15 Small-Scale Societies. American Economic Review, 91(2), 73–78.
• Kahn, H. (1965). On Escalation: Metaphors and Scenarios. Praeger.
• Mnookin, R. H. (2010). Bargaining with the Devil: When to Negotiate, When to Fight. Simon & Schuster.
• Nowak, M. A., & Sigmund, K. (1992). Tit for Tat in Heterogeneous Populations. Nature, 355(6357), 250–253.
• Nowak, M. A., & Sigmund, K. (1993). A Strategy of Win-Stay, Lose-Shift That Outperforms Tit-for-Tat in the Prisoner's Dilemma Game. Nature, 364(6432), 56–58.
• Paulhus, D. L., & Williams, K. M. (2002). The Dark Triad of Personality: Narcissism, Machiavellianism, and Psychopathy. Journal of Research in Personality, 36(6), 556–563.
• Pruitt, D. G., & Rubin, J. Z. (1986). Social Conflict: Escalation, Stalemate, and Settlement. Random House; 2nd ed. Rubin, J. Z., Pruitt, D. G., & Kim, S. H. (1994). McGraw-Hill.
• Sagan, S. D., & Suri, J. (2003). The Madman Nuclear Alert: Secrecy, Signaling, and Safety in October 1969. International Security, 27(4), 150–183.
• Schelling, T. C. (1960). The Strategy of Conflict. Harvard University Press.
• Skitka, L. J., Hanson, B. E., Morgan, G. S., & Wisneski, D. C. (2021). The Psychology of Moral Conviction. Annual Review of Psychology, 72, 347–366.
• Stout, M. (2005). The Sociopath Next Door. Broadway Books.
• Sun Tzu. The Art of War (ch. 7; many translations available).
• Swann, W. B., Jr., Jetten, J., Gómez, Á., Whitehouse, H., & Bastian, B. (2012). When Group Membership Gets Personal: A Theory of Identity Fusion. Psychological Review, 119(3), 441–456.
• Ury, W. (1991). Getting Past No: Negotiating in Difficult Situations. Bantam Books.