Nobel laureate Thomas Schelling's little-known role in the Vietnam War.

Thomas C. Schelling won the Nobel Memorial Prize in Economic Sciences this week. Today's papers note his ingenious applications of "game theory" to labor negotiations, business transactions, and arms-control agreements. But what they don't note what is little-known in general is the crucial role he played in formulating the strategies of "controlled escalation" and "punitive bombing" that plunged our country into the war in Vietnam.

Schelling made his mark in 1960 with a book called The Strategy of Conflict, in which he applied principles of bargaining to the practice of war. (He had been an international trade negotiator in the 1940s, and while he wrote his book he was a strategist at the RAND Corp., the Air Force think tank where nearly all the defense intellectuals cut their teeth in those halcyon days.)

He saw war as essentially a violent form of bargaining. There were, he wrote, "enlightening similarities between, say, maneuvering in limited war and jockeying in a traffic jam, deterring the Russians and deterring one's own children … the modern balance of war and the ancient institution of hostages."

The key dilemma among Cold Warriors of the day was the emerging nuclear parity between the United States and the Soviet Union. President Dwight Eisenhower was relying on a policy of "massive retaliation"—if the Soviets invaded Western Europe, we would pummel their country with nuclear weapons. But if the Soviets also had nukes, this policy would no longer be credible, because they could strike back against our country, too. So, what to do?

Schelling's answer was to retaliate "in a punitive sense" by "putting pressure on the Russians" through "limited or graduated reprisals," inflicting "civilian pain and the threat of more"—in short by sending signals with force, upping the ante in the bargaining round, intimidating them into backing down.

In his next book, Arms and Influence, published in 1966 but conceived a few years earlier, he went further. "The power to hurt," he wrote, "can be counted among the most impressive attributes of military power. … To inflict suffering gains nothing and saves nothing directly; it can only make people behave to avoid it. … War is always a bargaining process," and one must wage it in a way to maximize "the bargaining power that comes from the capacity to hurt," to cause "sheer pain and damage," because they are "the primary instruments of coercive warfare."

When, in the early months of 1964, President Lyndon B. Johnson and Secretary of Defense Robert McNamara were looking for ways to step up military action against North Vietnam, they adopted Schelling's concept....

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