Come on, it's about time we had a new one of these 
Whatever label you want to stick on it, unconditional parenting, gentle discipline, or just avoiding carrot or stick methods as much as possible in favour of a more co-operative approach, it works. (Personally I don't like the gentle label because I think that it's perfectly possible to be as firm as you like using these kinds of methods and "gentle" implies wishy-washiness.)
Not intended to be a debate thread, but a support/questions thread. Curiosity welcomed, outright "My way is better" posts not.
I promised a while ago I'd write up the basic principles that I try to stick to so hopefully this will help as a starting point as well as a reference.
1. Punishments are not always bad.
Sounds totally non intuitive, I know considering the thread title. The point is that punishment for punishment's sake is what's bad, or counterproductive, at least, but you shouldn't be afraid to do something which might upset your child if it's necessary to the situation. Try to ask yourself before you impose something:
- Is this helping the immediate situation, or physically preventing the situation from reoccurring?
- Is this helping my DC learn what's actually wrong with what they did?
- Is this helping make things right? (NOT in an eye-for-an-eye way!)
- Is this just to make me feel better?
- Is there an alternative which would achieve the same goal with less bad feeling?
2. Don't take it personally.
When your child is playing up, it's not because they are out to get you, and it's probably not a power battle, despite what all the expert opinions seem to be. They are reacting in the way they are reacting because that is the best way they know to deal with that situation, whatever it might be.
Even if they've done something deliberately hurtful or spiteful, look for the reason behind that - it's more likely to be a misguided attempt to express an emotion, e.g. anger, jealousy, upset, and it's possible to convey "Actually, that isn't acceptable" at the same time as dealing with the feeling behind the actions - in fact it's often more important to deal with the feeling first and the action later, especially if you're feeling you want them to suffer, "pay" or feel bad for what they've done. You can't induce guilt by punishing, it's more likely to induce resentment.
3. Show them what you want.
Both at crisis point and in everyday life, so, again, something often considered a punishment e.g. time out can work well here as long as you aren't threatening it or attaching negative connotations to it - just showing them "You are angry/excited/silly/winding each other up and I need you to take a breather" until they can do that for themselves.
In everyday life - model the behaviour that you want. If you slip into something you don't want them to model, like shouting, apologise as soon as you realise even if it's after the fact. Respond if they ask you to stop shouting, and own it, don't make them responsible for it (by saying things like "If you'd just listen, I wouldn't have to shout". Grown ups screw up too, and they need to see you deal with that graciously if they are to learn to do the same.
Listen to their requests and acknowledge them (which doesn't mean agree) if you want them to listen to you, don't belittle their feelings if you want them to be empathetic, say please and thank you and sorry. Negotiate but be firm.
4. Be specific with instructions or praise.
Linking back to the UP theory that rewards/praise can be harmful, especially if they are too non specific, try to steer clear of "stock praise" like good girl/boy, well done, etc. It's fairly easy once you get into the habit of it - I tend to use "Thank you for..." instead of "good boy" and "That's right" or some kind of comment about whatever it is DS is telling/showing me rather than just "Well done".
With instructions it's similar - you can start even when they're tiny, not just saying "No" but "careful" or "hot" or "Don't touch" and when they get a bit older trying to stick to the positive instruction like "Stay on the pavement" rather than "Don't go on the road" - it's also more instructive since not being on the road could mean the kerb is okay, or the grass, or that little low wall (which might actually be okay but you can negotiate easier if you're starting from a position of nowhere but the pavement.) I suppose points 3 and 4 are linked. So again, focus on what you want rather than what you don't want. It can also help especially with toddlers to instruct in advance/tell them what to expect, e.g. saying a few minutes before you get to a busy road that when you get there, they will need to go in the pushchair.
5. Look past the immediate behaviour.
Why are they behaving in this way? Immediate points to consider:
- Are they tired, hungry, hot or hormonal?
- Are you any of the above and so over-reacting?
- Is there anything else going on, even if it seems unrelated, that might be worrying them?
- Are you assuming adult priorities onto a child who might find something more important or more scary than you do?
- Have they got this behaviour from somewhere else?
- Are your expectations too high?
None of these are a total excuse but should shape the way you deal with things. It's also why things like reward charts etc aren't always helpful because they don't address why something isn't happening in the first place.
(Sorry this is so long 
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