The recent nuclear deal with Iran has generated a great deal of discussion about the concept of leverage. What does this give the U.S. — and what do we lose?
Many observers believe that the United States and the P5 +1 members (UK, France, China, Russia and Germany) have surrendered leverage over Iran through the deal, as it removes some of the sanctions that had served to constrain the Iranian government. But this discussion, framed in black and white, neglects to recognize that there are two different concepts of leverage that are relevant to the Iran deal. And while it is true that we have given some ground with one type of leverage, we have gained in the other — a far more productive kind of leverage — through the bargain.
The first of the two types of leverage is the traditional idea of bargaining leverage; the second is resource leverage. In traditional bargaining leverage, we achieve strategic advantage over another side through action (or inaction) that essentially coerces the other party into a set of actions we want them to take. Imposing sanctions is a classic form of bargaining leverage.
Resource leverage, a concept frequently discussed with respect to management theory, for example by C.K. Prahalad and Gary Hamel in their landmark book, "Competing for the Future," involves using resources to arrive at creative solutions to problems. Leveraging resources, whether it is existing products, labor, relationships or information technology, typically involves moving outside of a limited framework in order to imagine some new model for doing something. The Walkman, Messrs. Prahalad and Hamel explain, was created by taking the tape recorder and the headset and combining them into a new product.
In the case at hand, increasing resource leverage doesn't just ease the pressing nuclear issue but builds the networks that will be necessary to eventually shift the relationship with Iran to a peace footing. Increasing resource leverage builds relationships, reduces overall threat and reluctance to negotiate and in so doing creates an amplifying effect.
Bargaining leverage, through its coercive aspect, increases resistance to its use over time. Moreover in absence of other types of interaction, situations tend to become perceived as black or white, and when bargaining leverage fails, it will fail totally — and often violently.
The Iran deal certainly does give up some traditional bargaining leverage, but it does so by employing resource leverage — in particular the leveraging of relationships among the P5 +1 partners in order to craft a diplomatic solution to the nuclear weapon crisis.
That shift lowers resistance to further negotiation, so bargaining leverage — and the need for it — is reduced.
The resource leveraging approach is a less adversarial means, and thus represents an improved form of leverage. Creating a peaceful relationship is a far more effective way of preventing that weapon from coming into being than forcing an enemy's hand.
Indeed, an increasing number of geopolitical problems are being addressed with resource leverage rather than bargaining leverage, including combining public and private resources that generate cross-border infrastructure projects that improve regional integration, as highlighted in Parag Khanna's "How to Run the World." The United States' efforts to create a Pacific Century by leveraging our relationships with South Korea and Japan in order to improve our standing with China is another example.
Interestingly, the concept of leverage has been central to major developments in recent years, including the Global Recession, which was an investment leveraging crisis and the Government Shutdown of October 2013, which was a political leveraging crisis.
Thinking about the Iran crisis in terms of bargaining leverage alone seriously misrepresents the political reality. Once we recognize that there are two concepts of leverage at play in this international dynamic, then we can see our options more clearly.
David M. Anderson is editor of Leveraging: A Political, Economic, and Societal Framework (due out June 2014 from Springer) and an adjunct faculty member at the Johns Hopkins University's Center for Advanced Governmental Studies in Washington. His email address is email@example.com. David G. Alpher, Ph.D. is a contributor to Leveraging and an adjunct professor at American and George Mason Universities. His email address is firstname.lastname@example.org.
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