The prisoner’s dilemma unfolding in the Senate

The star of the ongoing show in the Senate, the junior engineer, confidently and consistently explains, “I was just instructed by my boss.”

Just a few feet from him, his former boss at the Department of Public Works and Highways (DPWH) shakes his head and frustratingly answers “I’m always being identified as the one who gave the instructions, but I do not know these people,” referring to the other parties his former subordinate has implicated in the massive corruption scandal.

While this exercise is investigative in nature, beneath this national drama a game is being played out.

Game theory is one of many areas of study in economics. This field looks at the decision-making of individuals or groups when their choices are interdependent. In other words, this occurs when our choices affect the choices of others, and their choices affect ours.

A game exists when there are players, there are strategies, and players try to maximize or minimize their situation depending on whether there is a payoff or a penalty.

One of the models in game theory is the prisoner’s dilemma. Briefly, two criminals are being interrogated separately by the police. Both prisoners have the choice of denying or confessing.

Since neither knows whether the other prisoner will deny or confess, the dilemma is whether to cooperate with each other and possibly secure their freedom or cooperate with the police and confess and obtain a lighter sentence, but to the detriment of one’s co-conspirator.

What is the best strategy for each prisoner given the knowns and unknowns?

This is the situation unfolding in the Senate. Player A is the junior engineer. His initial strategy has been to confess to being a participant in the scheme, but he is not the “mastermind” and was only following orders.

The payoff is that he may likely convince the senators that he is not the guiltiest and deserves a lighter penalty, or deserves to be a state witness and possibly keep some of the gains from the venture.

Regardless, what is clear is that his choice is not to cooperate with his former boss. If this is a turn-based game, Player A’s action last week affects Player B’s strategy this week.

Player B is the boss. Given the non-cooperation of Player A, his strategy is to deny being involved. Instead, his narrative is that all of this was the work of Player A and was done without his knowledge or awareness.

Based on media reports of Player A’s testimony, Player B is being linked to members of Congress, but has no direct link or transaction with the contractors. Player B is mentioned only as part of the higher layer or ranking in this scheme.

There is another player in this game. The government and the public play roles opposite to both Player A and Player B. The latter two players’ strategy of non-cooperation also presents a dilemma for the government.

The government may choose to take a loss with one player to secure a win with the other.

Whatever the decision may be, this may alter how both Player A and B will play going forward.

In sum, one player confesses participation while the other player confesses negligence — but both deny accountability.

It may not be clear to the players, but there is no outcome where one of them will come out better than at the start. It is not a zero-sum game for them.

Given the evidence that both players benefited or consumed the fruits of corruption, this removes any upside from the game.

Only a minimization of their respective downsides is what remains. Although one of them may end up the bigger loser, at the end of the day both players will suffer significant losses, and the government/public will maximize their gains.