The Prisoner's Dilemma

The Prisoner's Dilema is an intellectual game with implications in the real world of dealing with people who you may not be able to trust. It comes up commonly, and recently one such scenario actually did happen as a current event.
In the game, you and another person (a smalltime acquaintance of yours who you don't know very well), are accused of committing a crime. The police separate the two of you and ask each of you separately if the other person is guilty. You both have the choice of cooperating with each other and proclaiming the other's innocence, or tattling on the other person.
The results depends on what the police learn from this investigation. If neither of you talks, they'll probably be able to press a lesser charge on you both, and you'll both spend a week or two in jail, but you'll escape conviction . If both of you tattle, you'll both surely be convicted on this evidence, and you'll both spend 3 years in jail. And if one of you talks and the other doesn't, then the tattler escapes and the victim rots in prison for 5 long years. So....what will you tell them? The best possible result for you may be to play the other guy for a sucker, but the net benefit is for you both to cooperate.
Worse, the real life versions tend to be iterated, where you and the other guy show up over and over and over, and have the same choices every time. Reward vs. Punishment are on the line, and the other guy definitely remembers what you did the last time.
A university did a simulation of iterated prisoner's dilemma to see if there's a rational way to handle scenarios like this, and the results were surprising. Various programs were put in that used various strategies. There were programs that always cooperated. There were programs that always attacked. These tended to get eliminated pretty quickly when their bad choices caught up to them. One early winner was a strategy that they called "Tit for Tat." This program started out cooperating, and then always used the same strategy that the partner used last time. So if you cooperated with it, it cooperated with you. If you wronged it, it got revenge. But the ultimate winner was "Generous Tit for Tat," which sometimes declined to go for revenge, thus getting out of some vicious cycles.
I say this came up in the news due to the situation with Russia, America, and Nuclear Weapons. Russia would like to inspect US uranium mining and nuclear production, and limit both countries supplies of nuclear weapons. This is an iterative prisoner's dilemma, with the "cooperate" option being to let the other country's inspectors in and limiting the production of nuclear weapons, and the "defect" option being to eject the other country's inspectors and build more nuclear weapons to gain the other hand.
Previously, both of us have chosen "cooperate" with the SALT and START treaties. Shortly after SALT II was an arguable defection on both sides, when the Reagan administration refused to sign the treaty on the grounds that Russia violated it, and Russia responding with a large construction of additional nuclear weapons.
So then, America, we have a choice. Cooperate or Defect. And Russia is watching.