As always, everything depends on the other player. Gandhi's strategy of defection was successful only because the British strategy of defection (mostly) did not include mass murder. The Jewish strategy of cooperation in occupied Europe failed because Nazi defection meant that all cooperating Jews died--the ultimate sucker's payoff.
Tit for Tat is not the best of ethical standards--that of Jesus, Gandhi and Dr. King, all murder victims, may well be--but Tit for Tat may in fact be the best ethics available for those who wish to survive in our imperfect world.
I am a cooperative person--I find a kind of chemical high in good teamwork--and for years it was my unexamined strategy to continue extending cooperation far beyond the point at which it should have been apparent there would be no reciprocity. I was not able to understand the mysterious motivations, the self deception, that leads other people to defect when there is no long term benefit to be gained. Then, when I abruptly awoke to the fact that I was a sucker, I would quit the game entirely (leaving a job, for example, is a form of defection that by definition ends the game with that particular player, the employer.)
Not all prisoner's dilemmas permit one to walk away, and the purest form of the dilemma, the one most worthy of study, is precisely the one where the parties are inextricably chained to one another, like the U.S. and the Soviet Union were during the cold war. Cooperation and defection were options; leaving the planet to get away from the Soviets was not.
I always cooperated in earlier years because I was a naive optimist. I always believed that if I cooperated long enough, even unilaterally, the other player would come to trust me, and see the value of cooperation. What I refused to see is what the prisoner's dilemma teaches: anyone who plays the "All Cooperate" strategy is a sucker, and incents the other to defect on every move. I now believe that the lesson of the prisoner's dilemma is that a robust ethic succeeds where a weak one fails. Be fair, be strong, reward cooperation and punish defection, and you will have nothing to regret.
Usually. Because even then, life may not let you live according to your lights. Each of us may at any time be presented with choices to which there is no easy or right answer. If you are playing a scorpion, who escalates immoral and destructive tactics in each defection, how do you respond? You walk away from the game if you can, but suppose you can't? Put another way, do you become a Nazi in order to fight the Nazis? Where do you break free, by choosing to die instead?
This is an extreme case. Most people manage only to play against players whose defection will leave them standing (people ruined by their stockbrokers are just one example of not following this advice.) Most of us do have the ability to walk away from at least some prisoner's dilemmas. Looked at this way, you are only a prisoner if you want to be. You always have a choice; you can always, given no other choice, choose to be a sucker rather than a defector.
The prisoner's dilemma gives us insight also on the influence of human xenophobia and racism. When you begin an iterated game, your stereotypes regarding the other player may influence you to defect on the first move. You are especially likely to defect, triggering an unending chain of defections, if the other player belongs to a group you believe is especially likely to defect.
Axelrod highlights how a majority group, playing Tit for Tat with each other but "All Defect" with the members of a minority, will thrive, while the minority, pursuing the same strategy, suffers. A member of the majority group will have more people with whom to cooperate over time, while the minority member will suffer more defections as he comes up against members of the majority. Looked at this way, affirmative action is nothing more than a way to break the series of defections by encouraging a few acts of cooperation that will lead to more. People who want life to be totally race blind are ignoring the different effects on a majority and a minority group of the same strategy of internal cooperation and external defection. The vicious circle must end somewhere, and those fighting affirmative action have not offered any alternative method to end it.
The ultimate and rather lovely lesson of the prisoner's dilemma is that the better I know you, the more entwined our destinies are, the more likely we will learn to cooperate with each other. The shadow of the future must be long (which it is) and we must recognize it (which we do not always). Familiarity breeds cooperation and defection breeds defection and death. In this world, Tit for Tat is the best strategy available.