Part 15 – Theoretical Models: Veto Players, Brinkmanship, and Bargaining Under Shutdown Risk

Aim: connect shutdown dynamics to core theories in political science and economics, so we can explain (not just describe) why shutdowns occur, persist, and end when they do.

15.1 Veto-player theory (why gridlock is “baked in”)

  • Idea. Policy change must be approved by all veto players whose assent is necessary (separate institutions, pivotal factions).
  • Implication for shutdowns. The U.S. has many veto players (House, Senate, President; plus pivotal caucuses and the Senate filibuster). When their ideological distances are large, the “win-set” of feasible agreements is tiny → higher stalemate risk and longer lapses.
  • Use. Predicts which chamber/faction is pivotal each episode and why small margins amplify brinkmanship.
  • Key source: Tsebelis (2002).

15.2 Pivotal politics & the “gridlock interval”

  • Idea. Even with simple majorities, policy must satisfy pivotal legislators (e.g., filibuster pivot, veto-override pivot).
  • Implication. If the status quo (no appropriations) sits inside the gridlock interval, parties can’t move to a new point without losing a pivot. A shutdown ends only when pressure shifts a pivot’s calculus (e.g., polls, salience, elite signals).
  • Key source: Krehbiel (1998).

15.3 Procedural cartels & agenda control

  • Idea. Majority parties act as procedural cartels that control the agenda to avoid “rolls” of their own members.
  • Shutdown twist. Leadership may withhold a compromise vote that could pass with cross-party support if it would splinter their caucus. This sustains brinkmanship until a leadership-approved package is found.
  • Key sources: Cox & McCubbins (2005); Rohde (1991).

15.4 Brinkmanship & commitment (Schelling)

  • Idea. In brinkmanship, actors deliberately create risk they can’t fully control to force concessions (e.g., allowing the ADA to trigger a shutdown).
  • Credibility. Because the Antideficiency Act compels closure, threats are credible: once you “tip,” pain occurs automatically.
  • Why deals arrive late. Concessions cluster near salient pain points (missed paydays, flight disruptions, holidays) that shift incentives.
  • Key source: Schelling (1960).

15.5 War-of-attrition models (who blinks?)

  • Idea. Two sides endure costs over time; the side with higher private costs or weaker stamina concedes first.
  • Shutdown mapping. Costs are unevenly distributed: federal employees get back pay, but contractors and small firms suffer permanent losses. If core political actors don’t bear the steepest costs, attrition can last inefficiently long.
  • Key sources: Hendricks, Weiss (1979); Banks & Duggan (2006).

15.6 Audience costs & signaling

  • Idea. Leaders risk punishment by their political audiences for backing down; they therefore signal toughness by prolonging conflict.
  • Shutdown mapping. Base voters and partisan media can raise audience costs for compromise, particularly in leadership races or primary seasons.
  • Key sources: Fearon (1994); Schultz (1998).

15.7 Repeated games & reputation

  • Idea. Today’s compromise shapes tomorrow’s expectations; yielding now may invite future ransom demands.
  • Implication. Actors avoid early compromise to protect reputational capital; hence convergence occurs only when shadow-of-the-future costs (polling damage, donor pressure) outweigh reputational loss.
  • Key sources: Axelrod (1984); Fudenberg & Tirole (1991).

15.8 Endogenous deadlines & exploding offers

  • Idea. Deadlines create bargaining power (exploding offers, “hostage-taking”).
  • Shutdown mapping. Statutory fiscal dates (1 October; CR expiries) are endogenous tools—actors set/stack deadlines to concentrate pressure, but this also raises accident risk (lapses).
  • Key sources: Spence (1973); Watson (1998) on bargaining with deadlines.

15.9 Median voter vs. intense minorities

  • Puzzle. If median voters dislike shutdowns, why do they happen?
  • Answer. Intense minorities (motivated factions) can dominate primaries and leadership selection, outweighing diffuse median preferences in intra-party arenas.
  • Result. Leaders may accept general-election risk to avoid intra-party punishment now.
  • Key sources: Mayhew (1974); Brady, Han, Pope (2007).

15.10 Bureaucratic politics & principal–agent frictions

  • Idea. Agencies (agents) must follow the ADA even if principals (electeds) can’t agree; contingency plans preserve core functions but magnify visible pain (parks closed, data blackouts) that principals then use in bargaining.
  • Key sources: McCubbins, Noll & Weingast (1987); Moe (1984).

15.11 Punctuated equilibrium & policy punctures

  • Idea. Long periods of inertia interrupted by punctuations (large shifts).
  • Shutdown mapping. Lapses can act as punctuation shocks that reorder priorities (e.g., 2019 back-pay law; renewed auto-CR proposals).
  • Key sources: Baumgartner & Jones (1993).

15.12 Synthesis: when do shutdowns end?

  1. Pivot shift: Public pain moves a pivotal legislator (Krehbiel) or faction (Cox & McCubbins) into the win-set.
  2. Cost tipping point: Attrition costs (contractors, aviation, data blackout) exceed audience-cost benefits.
  3. Reputational recalculation: Leaders decide that continuing harms future bargaining position more than conceding now.
  4. Coordination device: A new deadline (payday, holiday travel) or a procedural innovation (clean CR vote) breaks the stalemate.

15.13 What the models imply for reform

  • Reduce veto points (or lower their salience): streamline procedures, package appropriations, or raise the cost of blocking floor votes.
  • Change payoff structure: Auto-CRs remove public as “hostage,” raising the relative cost to politicians of delay.
  • Alter audience signals: Transparency (CBO/GAO harm reports) can reallocate blame, shortening attrition games.
  • Lock in continuity: Provisional-funding rules shrink the gridlock interval by making the status quo less painful to the public—still leaving room for negotiated change.

References

Axelrod, R. (1984) The Evolution of Cooperation. New York: Basic Books.
Banks, J. S. and Duggan, J. (2006) ‘A Dynamic Model of Democratic Elections in Multidimensional Policy Spaces’, Quarterly Journal of Political Science, 1(4), pp. 367–396.
Baumgartner, F. R. and Jones, B. D. (1993) Agendas and Instability in American Politics. Chicago: University of Chicago Press.
Brady, D. W., Han, H. and Pope, J. C. (2007) ‘Primary Elections and Candidate Ideology’, Legislative Studies Quarterly, 32(1), pp. 79–105.
Cox, G. W. and McCubbins, M. D. (2005) Setting the Agenda: Responsible Party Government in the U.S. House of Representatives. Cambridge: Cambridge University Press.
Fearon, J. D. (1994) ‘Domestic Political Audiences and the Escalation of International Disputes’, American Political Science Review, 88(3), pp. 577–592.
Fudenberg, D. and Tirole, J. (1991) Game Theory. Cambridge, MA: MIT Press.
Hendricks, K. and Weiss, A. (1979) ‘A Theory of War of Attrition’, Econometrica, 47(1), pp. 291–321.
Krehbiel, K. (1998) Pivotal Politics: A Theory of U.S. Lawmaking. Chicago: University of Chicago Press.
Mayhew, D. R. (1974) Congress: The Electoral Connection. New Haven: Yale University Press.
McCubbins, M. D., Noll, R. G. and Weingast, B. R. (1987) ‘Administrative Procedures as Instruments of Political Control’, Journal of Law, Economics, & Organization, 3(2), pp. 243–277.
Moe, T. M. (1984) ‘The New Economics of Organization’, American Journal of Political Science, 28(4), pp. 739–777.
Rohde, D. W. (1991) Parties and Leaders in the Postreform House. Chicago: University of Chicago Press.
Schelling, T. C. (1960) The Strategy of Conflict. Cambridge, MA: Harvard University Press.
Schultz, K. A. (1998) ‘Domestic Opposition and Signaling in International Crises’, American Political Science Review, 92(4), pp. 829–844.
Tsebelis, G. (2002) Veto Players: How Political Institutions Work. Princeton: Princeton University Press.

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