But the more Taiwan accommodated PRC demands by allowing itself to become something more resembling Hong Kong or Tibet than an independent country, then the more the probability of US intervention would begin to approach zero as it does for other areas under direct PRC control. Such intervention would increasingly, and unambiguously, represent intervention in a civil, rather than an international, conflict.18 Thus any bargain involving a reduction in Taiwan’s sovereignty should independently reduce Beijing’s expected costs of war, thus pushing R even further to the right. The credibility of Beijing’s commitment to such a bargain would therefore be suspect, as once it was implemented Beijing would have incentives to demand an even more favorable bargain (and Taiwan would not be in a position where it could refuse). Fearon develops a similar model where states bargain over strategic territory and the outcome of the negotiations explicitly shifs the balance of power.19 This change in the balance of power happens because the outcome of the negotiation transfers territory to a rival state and thereby improves that rival’s fighting capacity. When this type of dynamic is at work, reaching a settlement becomes difficult because the consequence of the shif in power caused by a settlement may be less desirable than fighting and forgoing any negotiations. Although a hypothetical bargain between the PRC and Taiwan is not over strategic territory, it is certainly possible that a similar dynamic is at work as the PRC and Taiwan negotiate over Taiwan’s sovereignty. Inasmuch as giving up sovereignty to the PRC strengthens the PRC’s bargainingleverage, Taiwan may come to the conclusion that risking war is preferable to any negotiated settlement with the PRC over unification. In other words, Taiwan may conclude that it would be better to roll the dice in a war with China today than to accept the terms of an obsolescing bargain likely to result in a progressively more subordinate status within a unified China. Therefore, in the same way that bargaining over strategic territory is complicated by the strategic consequences of any deal that might be struck, bargaining over unification can be dangerous because it has implications for the future bargaining power of the PRC and Taiwan. In summary, ending arms sales to Taiwan would have the potential to increase instability in the Taiwan Strait. Such a shif in US policy could alter the balance of power in the Taiwan Strait, which in turn could shif the strategic dynamic
from deterrence to compellence. In turn, there are reasons to believe that a China-Taiwan relationship in which China tried to compel steps toward unification would be more conflict prone than one where the PRC tried to deter Taiwan steps toward independence, as credible commitment problems could make it difficult for Taiwan to accommodate new power realities.