Obama’s Nuclear Posture Review has been revealed. The main changes:
(1) We promise not to use nuclear weapons on nations that are in conflict with the U.S. even if they use biological and chemical weapons against us;
(2) Nuclear response is on the table against countries that are nuclear, in violation of the N.P.T., or are trying to acquire nuclear weapons.
This is an attempt to use a carrot and stick strategy to incentivize countries not to pursue nuclear weapons. But is it any different from the old strategy of “ambiguity” where all options are left on the table and nothing is clarified? Elementary game theory suggests the answer is “No”.
First, the Nuclear Posture Review is “Cheap Talk”, the game theoretic interpretation of the name of our blog. We can always ignore the stated policy, go nuclear on nuclear states or non-nuclear on nuclear states – whatever is optimal at the time of decision. Plenty of people within the government and outside it are going to push the optimal policy so it’s going to be hard to resist it. Then, the words of the review are just that – words. Contracts we write for private exchange are enforced by the legal system. For example a carrot and stick contract between an employer and employee, rewarding the employee for high output and punishing him for low output, cannot be violated without legal consequences. But there is no world government to enforce the Nuclear Posture Review so it is Cheap Talk.
If our targets know our preferences, they can forecast our actions whatever we say or do not say, so-called backward induction. So, there is no difference between the ambiguous regime and the clear regime.
What if our targets do not know our preferences? Do they learn anything about our preferences by the posture we have adopted? Perhaps they learn we are “nice guys”? But even bad guys have an incentive to pretend they are nice guys before they get you. Hitler hid his ambitions behind the facade of friendliness while he advanced his agenda. So, whether you are a good guy or bad guy, you are going to send the same message, the message that minimizes the probability that your opponent is aggressive. This is a more sophisticated version of backward induction. So, your target is not going to believe your silver-tongued oratory.
We are left with the conclusion that a game theoretic analysis of the Nuclear Posture Review says it seems little different from the old policy of ambiguity.