Three professors of false equivalence look at the Obama-Boehner faceoff

The Times' James B. Stewart today interviews three management gurus who think that "getting to yes" in a deficit reduction deal ought to be easy. These men presumably know a good deal about corporate negotiations. But their apparent ignorance of politics -- political dynamics generally, and the battles of the last two years in particular -- is breathtaking.

The three cited experts, William Ury of Harvard, Seth Freeman of Columbia's Stern School, and Daylian Cain of Yale,  collectively assert the following: both sides are taking and have taken maximalist, uncompromising positions; neither allows the other any face-saving outs; and they are not that far apart substantively. Prof. Cain suggests that spending time together socially could make a substantive difference.   All of these assumptions are wrong.

Scrutinizing Warren's warranty for Goldman

Good for James B. Stewart for pushing back against Warren Buffett's defense of Goldman's conduct in the Abacus CDO deal that prompted the SEC to sue Goldman for fraud.  Buffet, Stewart recounts, affirms that there was nothing wrong in Goldman's failing to disclose the identity of the short investor, Paulson, to those going long on the portfolio of mortgage bonds that comprised the synthetic CDO.

"The essence of the alleged fraud," Stewart reminds readers, is not that Goldman did not disclose Paulson's identity, nor that there was a short seller, but "that Goldman let the short seller choose some of the underlying subprime mortgages, failed to disclose that, and instead promoted the idea that an independent third party chose those securities."  He then joins the panoply of observers who have sought a metaphor to illuminate the moral essense of this kind of dealmaking, and comes up with a good one:

With the Kentucky Derby in mind, let's consider a horse-racing analogy. There are just two horses and two bettors. The promoter offers you the opportunity to bet on one horse. Someone else is betting on the other. He doesn't tell you that the other bettor chose the two horses in the race, and picked one horse with no chance of winning. Instead, he says the horses were picked by an independent racing federation. You bet and lose. Would you feel that was fair?

If I may venture an emendation: it's as if Goldman allowed "the other bettor" not to choose two horses but to assemble one horse, Frankenstein-style, picking more than half of its genes at the outset from an available pool (admittedly of a specified, dicey quality) and signing off on every gene eventually included -- all with an eye to creating a horse misbegotten enough to be almost certain to break all its limbs should the race terrain grow at all rocky  (the race will be across unknown terrain) . The promoter seeks bettors on the other side, emphasizing that an expert genetic designer of horses created this specimen, and thus suggesting that it is  sturdiest horse that could be created from the agreed-upon gene pool.  (I've compiled various other informed perspectives on the ethics of the deal here.)