Showing posts with label Nash Equilibrium. Show all posts
Showing posts with label Nash Equilibrium. Show all posts

Thursday, July 16, 2015

Iran Deal Is The Best The World Could Get: So Critics Must Stop Bellyaching About It!

To hear the parade of warmongering Neocon repukes squawking, as well as Israel's deranged PM Benji Netanyahu, you'd think Obama had sold the Southern states to Iran along with Israel's  Gaza strip.  All you heard is bombastic bloviation such as out of bonehead Mitch McConnell's mouth that the ideal deal would be "one through which Iran gets no nuclear weapons" which is as full of hot air as when he claimed we needed a war in Syria 3 years ago to put Assad in his place.

Meanwhile,, perpetual Reeptard nincompoop Darrell Issa insisted the deal was "junior varsity foreign policy grounded in childlike optimism rather than clear-eyed realism".  Clearly unable to tell the difference between them, since this deal  - as I will show - is about as realistic as one can get, short of all out war which is really what most of these jabbering assholes want.

The editorial pages of newspapers split along typically Neocon v. non-belligerents' lines with The NY Times accurately calling the deal "one of the most consequential accords in recent diplomatic history" while the now neocon -contaminated WashPo claimed "it was a complex and costly deal that poses a major threat to the United States and its allies."

Meanwhile, the reactionary Wall Street Journal op ed pages featured almost end to end 'hair on fire' columns such as Patrick Kagan's  "Why The Iranians Are Cheering".   But what would you expect? Bear in mind the only viable alternative to this diplomatic solution would be war. That means millions of tons of weapons, including cruise missiles, obliterated which then have to be remanufactured - jacking up defense budgets and share values for contractors.


Then there is the low grade tabloid press, including the NY Post and  Daily News called the deal a joke, but what do you expect coming from media bottom feeders that are themselves jokes?

Anyone remotely familiar with cooperative game theory principles would understand this was the best deal we could obtain, i.e. that didn't totally shank one side. Indeed, the fact hardliners in both the U.S. and Iran are railing  against it shows it struck the exact right balance between hideous and effective.

As nuclear compliance specialist Joe Cirincione ('Ploughshares Fund' President) put it on Rachel Maddow two nights ago:

"This is a way to stop Iran from getting the bomb. without going to war. It has its risks, but those pale compared to the alternatives."

Indeed. He then elaborated on the parameters, to which most critics are oblivious when they yelp that Iranians are too "wily" and have "every incentive to cheat". (Implying the IAEA isn't up to the job of inspection).

"This is not based on trust, this is not based on good intentions. It's not based on the technologies we've used in Iraq, for example. This is 21st century technology, state of the art, fiber optics seals, cameras, sensors, audits, inventories allowing 24/7 inspections in all the declared facilities and the right to inspect suspect facilities including the military sites so much in dispute. One might possibly evade one layer of these inspections but the chances of evading all are quite remote . We can track every aspect of Iran's  production and with those inspections there's no expiration date."

This is critical because it means the harshest critics - namely the Repukes, the Wall Street Journal op-ed bunch  and Netanyahu-  are not aware of the modern in situ sensor inspection capacity, i.e. that allows the Iranian facilities to be electronically "spy"  monitored 24/7. Why hasn't more been published on this technology to reduce the widespread ignorance? Probably because the spooks like in the NSA - who use it in other venues - do not want the details known. Fair enough, but the problem is we are  then forced to listen to critics' complaints based on their antiquated perceptions from what they understood about the old time inspections using actual humans in Iraq.

Getting back to the game theory aspect let us recall again  a ‘game’ means any mutual interplay between one or more players- which could be individuals, corporations or nations – in which one stands to gain a larger payoff than the other.
 
In each such game, the respective players (in this case, the U.S. and Iran) make choices from respective  sets: S i   (where in this case i= 1,…n). In addition we have n-real valued functions (in this case n = 2) described as:

P i = S1 X  ………S n ® R   (i= 1,…n)

Where R defines the Cartesian space.  The set S i   is called Player i’s ‘strategy space; while P i  is called the “payoff function”. We take S i  to be the set of actions available to the character called Player i, and we insist each Player must choose some action – and even a “non-action” can be included in the set since it can provoke a response in the other Player.  Note there will also be some actions that have joint consequences,  and that  P i basically measures Player i’s assessment of the consequence.

Other basics:

Cooperative Game: One for which some kind of binding agreement is possible


 Non-Cooperative Game: One for which no binding agreement is possible.

Strategy: involves a set of rules S i which defines which action is taken at each point in the game.

A ‘strategy pair’ i.e. (a*, b*) is such that a* represents A’s best move when B plays b*, and b* represents B’s best move when A plays a*.

In a Nash Equilibrium, no player has an incentive to change strategy.

A “Dominant strategy” is optimal no matter what the other player does.

A sequential game is one which evolves in time and for which Payoffs P i  are exchanged  based on sequential actions S i, eventually leading to a denouement- or a stalemate.

From the above, we see this nuclear deal is predicated on a cooperative - sequential game. (As many have said, and I reiterate, this is not one 'done' deal but an unfolding process over YEARS.) The U.S. and its treaty collaborators (including from Europe and Russia) gain nuclear weapon neutralization while Iraq's payoffs include getting access to the global finance system and lessening of  sanctions.

In the case of the treaty template, each : S i  denotes an in situ inspection (via 24/7 electronic sensors) which then determine whether and to what extent the set of payoffs sets: P i  will be delivered.

The fact the deal is rigorously restricted to one objective  also aids in assuring its ultimate successful outcome, so there is no muddying the water with Iran's past history, whether it is a "good actor" on the Middle East stage or wants conventional weapons or whatever. It is strictly about preventing Iran gaining a nuclear weapon. As Obama put it yesterday, in an interview with Thomas Friedmann:

"We are not measuring this deal by whether it is changing the regime inside of Iran,” said the president. “We’re not measuring this deal by whether we are solving every problem that can be traced back to Iran, whether we are eliminating all their nefarious activities around the globe. We are measuring this deal — and that was the original premise of this conversation, including by Prime Minister Netanyahu — Iran could not get a nuclear weapon. That was always the discussion. And what I’m going to be able to say, and I think we will be able to prove, is that this by a wide margin is the most definitive path by which Iran will not get a nuclear weapon, and we will be able to achieve that with the full cooperation of the world community and without having to engage in another war in the Middle East.”

Let us finally acknowledge that it is primarily the reactionary Beltway bozos and poltroons  reacting negatively. Americans by significant majorities want this deal. Maddow cited a Quinnipiac poll, for example, that 73 percent favored it. And another poll showing 57 percent.

Will the politicos, especially on the Right, obey the will of the people, or go off half-cocked on their own as they have done with the efforts at gun control legislation, i.e. following the 2012 Aurora Theater then Newtown massacres? We will see!

 
See also:

http://www.smirkingchimp.com/thread/thom-hartmann/63054/dont-count-out-the-gop-from-trying-to-sink-obamas-historic-iran-deal-theyve-done-it-before

And:

http://www.smirkingchimp.com/thread/robert-parry/63036/the-world-rebukes-Netanyahu

Also:

http://www.smirkingchimp.com/thread/bob-burnett/63078/5-keys-to-the-iran-agreement

Tuesday, March 18, 2014

A Game Theory Perspective on the Ukraine Crisis

No photo description available.
Given the amount of noise issuing forth on how much truth we are getting concerning the Crimean annexation and the Ukraine crisis overall, I decided to examine events from a game theory perspective.  I consider this to be a more objective way of getting at the real picture, as well as explaining why certain moves have been made and why others might be – say by both ‘contestants’ – the U.S. and Russia.

I also want to make it clear that this approach removes any noise (say from conflicting claims) to do with whether neo-fascists or neo-Nazis were involved in the Maidan uprising. (A huge bone of contention on the web irrespective of which forums one visits.) In the end, whether they were or not is irrelevant. An examination based on non-cooperative game theory really shows what unfolded and why.

We need to begin by looking at some basic definitions and terms:

First, a ‘game’ means any mutual interplay between one or more players- which could be individuals, corporations or nations – in which one stands to gain a larger payoff than the other.

In each such game, the respective players (in this case, the U.S. and Russia) make choices from respective  sets: S i   (where in this case i= 1,…n). In addition we have n-real valued functions (in this case n = 2) described as:

P i = S1 X  ………S n ® R   (i= 1,…n)

Where R defines the Cartesian space.  The set S i     is called Player i’s ‘strategy space; while P i  is called the “payoff function”. We take S i  to be the set of actions available to the character called Player i, and we insist each Player must choose some action – and even a “non-action” can be included in the set since it can provoke a response in the other Player.  Note there will also be some actions that have joint consequences,  and that  P i basically measures Player i’s assessment of the consequence.

Other basics:

Cooperative Game: One for which some kind of binding agreement is possible


 Non-Cooperative Game: One for which no binding agreement is possible.

Strategy: involves a set of rules S i which defines which action is taken at each point in the game.

A ‘strategy pair’ i.e. (a*, b*) is such that a* represents A’s best move when B plays b*, and b* represents B’s best move when A plays a*.

In a Nash Equilibrium, no player has an incentive to change strategy.

A “Dominant strategy” is optimal no matter what the other player does.

A sequential game is one which evolves in time and for which Payoffs P i  are exchanged  based on sequential actions S i, eventually leading to a denouement- or a stalemate.

A perfect Nash equilibrium describes a best response equilibrium for a sequential game for which  all threats are credible.


The U.S.Russia “Game”  for Preserving Spheres of Influence:

In this game context, I look at a 20-plus year sequential game played by the U.S. vs. Russia and for which the subtext and most basic assumption is the “sphere of influence”.  This is taken to mean the geographic and geo-political domain in which a nation’s actions are justified and wherein it exhibits maximal latitude to determine its own self-interest especially in matters of national security.

The most thoroughly studied solution concept is the Nash equilibrium (see e.g. the book, The Essential John Nash, Princeton University Press, 2002,  Ch. 6 ‘Non-Cooperative Games’ – facsimile of Nash’s Ph.D. Thesis, and Ch. 7, presented in regular book font format). This is the outcome that results when the players maximize their own payoffs – taking the other player’s behavior as given.

In the game space graphic shown, I place the Nash equilibrium for the U.S.Russia contest just 2-3 yrs. past the point where in 1991, Mikhail Gorbachev refused to use force to keep the Soviet Union together and allowed Germany to peacefully reunify. In exchange, US President George H.W. Bush agreed not to expand NATO’s borders east, and certainly not to Russia’s borders.

This translated into a credible 'win-win' (analogous to both persons in the classic "Prisoner's Dilemma" refusing to rat on each other), and I argue that this equilibrium – if it had been preserved- would not have led to the current U.S. – Russian standoff.

Alas, the U.S. broke faith and began to play the “dominant” game (i.e. changing strategy to grab a seeming payoff and benefit  - breaking the then Nash equilibrium), egged on by its defense contractors like Lockheed Martin and others to grab former Soviet States like Latvia, Estonia etc. – suck them into NATO, and ply them with weapons sales.  The reason for adopting the dominant posture is still up for discussion, but according to blogger Eric Margolis, “Washington regarded Russia as a broken-down, third world nation beneath contempt”.

One may also invoke the classic American attitude evident after  any and all games, including sports like football, that if you don’t win you’re a LOSER!  Thus, unseemly behavior often follows. In the case of the U.S. with this high and mighty “we’re the winners” attitude it led to progressive expansion of NATO eastward.  This happened successively and sequentially over time with Bush Sr. and then Bill Clinton reneging on the deal and pushing Western influence eastward –to the Baltic states (Estonia, Latvia, Lithuania), then Romania, Bulgaria, Kosovo and Albania, then to Georgia.

By this time, a whole sequence of payoffs P i had fallen the Americans’ way, with little or nothing to be shown for Russia, other than Western encirclement which it has dreaded since the time of Peter the Great.

By 2008, Russia had had enough of the one-sided game and began to respond via its incursion into the former Soviet state of Georgia and the seizure of South Ossetia.  This is depicted in the graphic as an aggressive move upward and U.S. retreat. Bush could basically do nothing but wag his tongue, send a couple warships in the vicinity but not prevent Russia from getting its own, long overdue payoff.

The U.S. did not learn from this, and where a new Nash equilibrium might have been available, it instead continued – probably at the behest of neocons still in Obama’s administration – whereupon NATO offered membership to Ukraine.  Since the payoff here would be enormous, with NATO basically now on Russia’s ‘porch’ – Vladimir Putin had no choice but to respond aggressively, as Col. Lawrence Wilkerson observed on Chris Hayes All In show some two weeks ago.

Bottom line: the U.S. had overplayed its hand, or in the case of the game theory scenario – run up too many ‘payoffs’ without allowing much of any to its rival. In any game theory contest, when two players actually wield nearly equal power (and the Russians have it with their large standing army and nukes) this was a most unwise thing to do.

Basically then, as Eric Margolis puts it:

Having serially violated Russia’s traditional sphere of influence, it was inevitable Moscow would riposte.”

Even Col. Wilkerson noted that only a fool or ignoramus could not have seen it coming.

In a Game theory context, the next best move for the U.S. in view of its multiple payoffs so far in this sequential game, is to STFU and go home. It has expanded NATO to damned near the Russian borders and Russia raised nary a hue or a cry in the fifteen- odd years this has been going on.  To now demand Russian retraction or regression on top of the huge U.S. gains would amount to folly. It would border on seeking to humiliate Russia after winning nearly every interim bout in the sequential game contest.

Give it up already, and let Russia have the Crimea  (which would represent a near Nash equilibrium)without any further bombast, yap or empty threats. (In any case as The NY Times has noted, (March 9, p. 10) many nations have regarded Kosovo as a precedent, irrespective of whether Obama and the U.S. "believe it's not". Kosovo declared independence in 2008 and the U.S. under Gee Dumbya Bush recognized it, along with Britain, France and Germany, aka the Neolib trio.  Quoting Dimitri Simes, from the Center for National Interest in D.C. (ibid.):
"Independence was accomplished despite strong opposition by a legitimate, democratic and basically Western-oriented government."
Which shows how the hypocrisy in interpretation, coupled with rank jingoistic nationalism, can pervert the best minds leading them to believe Crimea's independence and Kosovo's are dissimilar. But this is what happens when one fails to see world events through a global lens, and uses only a nationalistic (or Neoliberal)  prism.
Amazingly, since the U.S. has already grabbed the Lion’s share of “payoffs” (see the payoff function in relation to 'actions'), it still comes out ahead.  The question is whether it is humble and sober enough to grasp that, or whether hubris will get the better of it again. In that case a de facto Nash equilibrium could well be disturbed and see Russia responding by invading eastern Ukraine and likely claiming it as a needed 'buffer'.  Obama, tell the neocons to cool it, or take a hike!

Footnote: Another game theory take appeared in the New York Times ('Crimea Through A Game Theory Lens', March 16, p. 6) but in my opinion missed the boat. It examined the situation in Ukraine purely from a U.S. hegemonic perspective, and how to stop Russia from making assorted moves and expanding American power, i.e. "there may be a net loss of credibility, when the world is uncertain where American self interest lies."  Which is exactly the problem! It lies all over the damned place, artificially projected to empire dimensions. This, instead of where it ought to be: in its own backyard tending to its own security and not minding the business of the whole freaking world!

See also: NATO's Warmongershttp://smirkingchimp.com/thread/brian-cloughley/54851/the-belligerent-alliance-natos-warmongers

and: NY Times Manufactures More Half Truths on Ukraine:

http://www.salon.com/2014/03/20/the_new_york_times_manufactures_ignorance_more_half_truths_about_ukraine/