The Petraeus incentive problem

Regardless of how you feel about the war, can't we all agree that General Petraeus has a terrible incentive problem? The Army culture dictates against saying you can't accomplish your mission, and no general wants to be remembered as the person who lost the war. As a result, his incentive is to tout our "progress" rather than answering the real question, which is whether the expected utility of staying in Iraq going forward is greater than the expected utility of withdrawing. And on top of all that, Petraeus allegedly wants to run for president in the future. It's no wonder the American people weren't confident that he would give an objective report.

Economists out there -- how could we have created better incentives? The example I'm thinking about is collaborative divorce, which attempts to eliminate the perverse incentives of divorce lawyers, who make more money if divorces turn ugly and go to court. (I actually heard about this on This American Life.) In collaborative divorce, the lawyer who represents you in the negotiation process is actually prevented from representing you in court. Thus, their incentive is to resolve problems rather than worsening them.

Along those lines, should Petraeus have had to resign after delivering his report? Should we tie future bonuses or promotion to the eventual outcome? Or what?

Comments

[Rob]

The basis for the allegation that Petraeus wants to run for President in the future is apparently a single uncorroborated report from an advisor to an Iraqi cabinet minister. The basis for the assertion that the American people weren't confident Petraeus's report would be objective is apparently the 53% to 39% response in the ABC News/Washington Post poll; however, the CBS News/New York Times poll found that 68% of respondents said that U.S. military commanders in Iraq are most likely to make the right decisions about the war. (And besides, even if a majority of the public doesn't believe in the objectivity of the report, that doesn't mean it isn't objective; if a majority of the public believes in supply-side economics, would that be relevant to the question whether supply-side economics is right?)

So to answer your initial question, whether we can all agree that General Petraeus has a terrible incentive problem: no, we can't.

[Todd]

A single uncorroborated report like the one's from "Curveball" that got us into this fucking mess? Like the one from Nigera regarding weapons grade plutonium that was actually proven false but still used as a justification to go to war. I dunno Rob, given our low standard for evidence these days, I think it seems pretty solid. No?

I too immediately dismissed the claim that Petraeus might want to run for President as routine character assassination surrounding his report. But the incentives part of the post sounds good. Even on Marginal Revolution I haven't heard of collaborative divorces before.