The first hint of serious trouble at the nuclear power plant came in the early hours of the morning, when instruments showed a problem with the coolant system. Engineers shut down the reactor, but the situation still worsened. Two hours later, they declared a state of emergency, notifying state and federal authorities. As dawn broke on Three Mile Island that March day in 1979, a crisis began not only for residents of central Pennsylvania but for the nuclear power industry.
Officials of Metropolitan Edison Co., the utility that owned the plant, wrote the textbook on how to mismanage a relationship with the public, according to Lawrence Susskind, professor of urban and environmental planning at MIT and director of the MIT-Harvard Public Disputes Program, and Patrick Field, a research associate at the Public Disputes Program. Key information was released slowly, and other information was simply wrong, they say in Dealing with an Angry Public: The Mutual Gains Approach to Resolving Disputes.
The Three Mile Island story plays out again and again in disputes throughout the country. The authors examine a dozen or so conflicts that show just how commonly business and government leaders tend to brush off those who question or disagree. “Indeed, they attempt to blunt or undercut the public’s concerns by dredging up countervailing facts’ or rebuttals from pseudo-independent experts and unscientific polls,” Susskind and Field write. “They commit to nothing and admit to nothing. The public is often treated like an angry mob rather than as concerned customers or citizens with legitimate fears, concerns, and needs.”
Arguing that negotiation with the public achieves better long-term results, the authors present a dispute-resolution strategy that they teach in the classroom. The “mutual-gains approach,” as they call it, relies on six principles, the first of which is that companies and government agencies must step back from their own self-interest and acknowledge early the concerns of all the contending stakeholders. The second requirement is that these companies and agencies engage in joint fact-finding with the public, working together to gather and then analyze information. Corporations that opt instead to massage information behind closed doors, or refuse to share their data, lose credibility.
Third, companies must offer firm commitments to compensate people if a planned course of action brings unintended consequences. “If a company or an agency promises that something will not happen, or cannot happen, they should stand behind that promise with a contingent offer of compensation,” say Susskind and Field. This approach, they point out, could help defuse many battles over matters such as zoning. For example, a hospital intent on building a new parking garage should do more than just assure abutting homeowners that their property values will not decline. The hospital should invite the homeowners to submit appraisals of their properties-and then create an escrow account that would reimburse anyone who sells within a certain period of time and does not receive either the appraised value or whatever higher value others in the area have enjoyed.
The fourth of the authors’ principles is that companies need to admit mistakes and share power. In cases where a firm’s initial course of action is flawed, allowing the community to help change it is the surest way to achieve a better outcome. Fifth, companies should act in a trustworthy fashion-that is, they should not camouflage intentions. Finally, they should look beyond the next days or months and instead build long-term relationships.
None of these admonitions are new, surprising, or particularly controversial. But are they followed in practice? Not often. The authors offer numerous examples of businesses or government agencies trying to steamroll their programs through, only to find themselves stuck in the mud.
Misreading the Mood
For Walt Disney Corp., getting stuck meant abandoning a major venture three years ago. As the authors recount, Disney promised that its project-a history theme park in the Virginia countryside-would create 12,000 jobs and produce more than $1 billion in tax revenues. But many people envisioned something quite different: major traffic jams, air and water pollution, and strips of run-down hotels and hot dog stands. More than 200 historians also criticized the project because, they said, it would trivialize important aspects of American history.
Unfortunately, the Magic Kingdom took little heed, relying on Mickey’s goodwill to carry the project through approvals. “Instead of making only positive projections,” Susskind and Field write, “Disney would have been better off providing a balanced assessment: pointing out the concerns of their critics, suggesting how they intended to address them, and acknowledging that the involvement of those concerned might be necessary to help shape acceptable solutions.”
In 1989, Hydro-Quebec, a large Can-adian hydroelectric utility company, similarly misread the public mood. The outcome was somewhat more serious, since the project in question, a massive effort to dam rivers and produce electric power for export to the United States, was already under way. The first phase, which had started 16 years earlier, entailed payments of $231 million to the Cree and Inuit tribes for the right to develop portions of their land. The Cree, however, objected to the second phase of the project, because the damming from the first phase had brought changes to their traditional way of life as well as serious environmental damage, such as mercury contamination of fish, a staple of the Cree diet.
But Hydro-Quebec wasn’t listening, according to Susskind and Field. The utility and the Province of Quebec resisted environmental review until a Canadian federal court judge ruled that such review was required by law. And even then the utility stood firm instead of negotiating seriously with the Cree. “The utility was never able to admit that the Cree had any legitimate concerns,” say the authors, and in 1994, after demand for Canadian export of electrical power declined, the project, long stalled because of the conflict, finally died.
What could the utility have done differently in handling its relationship with the Cree? The authors point to the need for intensive talks, especially where there existed such a vast cultural chasm be-tween the two sides. And the utility should have recognized that genuine negotiation with the Cree to restore the tribe’s well-being was more important than simply paying money to offset damages.
While accounts like these are instructive, one question that badly needs addressing is why firms are so reluctant to adopt the sort of approach Susskind and Field advocate. Part of the answer may be that from the perspective of many businesses, taking a hard line in response to public demands looks en-tirely rational. Justice Oliver Wendell Holmes recognized, in another context, the natural tendency of powerful groups to confuse power with wisdom and dismiss all dissenting voices. “If you have no doubt of your premises or your power and want a certain result with all your heart, you naturally express your wishes in law and sweep away all opposition,” he wrote in 1919.
Moreover, with power comes the fear of losing it-and what executive wants to lose it all to a plaintiff’s lawyer? The problems at Three Mile Island must have sobered many corporations to their potential liability. Company executives think of such things and draw their wagons in a circle.
If the authors’ ideas are to work, then, there must be some way to coax contentious parties into negotiations. Suss-kind and Field would have done well to explore practical ways to move disputants toward the mutual-gains approach they espouse. For instance, do we need new laws that would en-courage or require the use of alternative dispute-resolution techniques? Should local officials be trained in mediation? Even once a dispute ripens into a lawsuit, finding common ground may still be possible. Some judges have vigorously promoted dispute resolution for lawsuits that have reached their courthouse. Such measures are, at the very least, worth a try. Without them, examples of successful compromises could remain like the sightings of an endangered species.