July 05, 2005

Why the PRC Will Invade Taiwan

I think that Brian Dunn is doing good work in raising the alarm that the PRC could invade Taiwan. I also think he's getting the motivation wrong. The PRC has a pretty good deal going. If they could keep things as they are, they likely would. Thomas Barnett's connectivity thesis does have validity. Where it breaks down is when actors do not behave rationally. The problem is one of transparency or, more accurately, lack of transparency.

If the PRC is much less stable than we think it is. If the leadership sees itself getting ousted because the money to subsidize the great economic frauds of the SOEs is running out, it is a realistic possibility that they will take Taiwan for the money, cut loose the SOEs, and blame their resultant recession on the inevitable economic boycott that the rest of the world will impose on the PRC. Since so much manufacturing is based out of China, they are probably in for only a temporary period of economic isolation.

A few window dressing changes of leadership and things could get to normal pretty quickly. How would the US react if the KMT were legalized after a forcible Taiwan takeover and a third to a half of the Communist party cadres left to join the KMT? The two, after all, are no longer at war. They also both agree that Taiwan is part of China.

This fanciful scenario entirely depends on very secret data, the actual state of the PRC's economy and the regime's ability to surf the discontents of a peacefully rising China. Frankly, I'm not sure anybody on the North American continent (official or unofficial) is really sure what the fracture points are.

Posted by TMLutas at July 5, 2005 02:52 PM