So Harry Reid announced that the Iraq war is lost, that there is no military solution to the crisis. He’s being denounced, of course, by lots of right wing pundits, who are clamoring for his resignation. Regardless of whether or not you think the war is lost, I have trouble understanding how saying the war is lost is a bad thing. As I noted earlier, I think President Bush is suffering from a serious case of loss aversion. I believe that admitting defeat is simply be too painful a decision for Bush to make. Losing sucks, especially when the loss is entirely of your own making.
Psychologists have a name for this phenomenon: loss aversion. First identified by Kahneman and Tversky in the late 1970’s, loss aversion is best illustrated with a simple bet. When offered a gamble on the toss of a coin in which they might lose $20, most people demand a payoff of at least $40 if they win. (Most people would also refuse a bet in which they have an 85 percent chance of doubling their life savings and a 15 percent chance of losing it.) In other words, the pain of a loss is approximately twice as potent as the pleasure generated by a gain.
How does this bias relate to Bush? No president wants to lose a war. As Kahneman himself noted:
U.S. policymakers faced this dilemma at many points in Vietnam and today in Iraq. To withdraw now is to accept a sure loss, and that option is deeply unattractive. The option of hanging on will therefore be relatively attractive, even if the chances of success are small and the cost of delaying failure is high.
This is why I have no problem with Harry Reid admitting defeat. I don’t know if the war has already been lost, but any reasonable military strategy for the future must take into account the fact that the war might be lost. Failure is always an option, and when we pretend that it isn’t we are simply indulging our irrational aversion for losses. We are letting our wishful biases dictate our reality. Sometimes, it’s better to take a painful loss than keep on pretending that there’s something left to win.