#2 - The Four Pillars of Taiwan Deterrence

Why military deterrence is necessary, but not sufficient—and canceling Lai's visit is a mistake.

Jul 29, 2025

The Trump administration is blocking Taiwanese President Lai Ching-te from transiting through New York on a trip to Latin America. It’s an olive branch to Beijing because President Trump wants a meeting with Xi Jinping.

It’s good that high-level U.S.–China relations are stabilizing. But using Lai’s visit as a bargaining chip is a mistake that undermines deterrence.

The U.S. strategy to deter China from aggressing against Taiwan rests on four pillars: political, conventional military, strategic, and economic. This week, we’ll explore how the four pillars support one another.

The bottom line: Robust military deterrence is necessary—but it’s no longer sufficient to deter aggression by itself.

Taiwan is 'of course' a country, president says in rebuke to China | Reuters

1. Political deterrence

Deterrence is not just about what you can do. It’s about what you probably would do in a hypothetical scenario. The theory of deterrence calls these signals “credible resolve” and “credible restraint.” If Xi Jinping miscalculates about U.S. resolve to defend Taiwan from aggression, deterrence could fail even if U.S. military is far more powerful than China’s. Or, if Xi misperceives a U.S. plot to use “Taiwan independence” to undermine his hold on power, he may act out of desperation. Deterrence failed in 1941, even though Japan had one-fifth the GDP, an enormous ongoing war in China, and many other structural disadvantages. Pearl Harbor happened anyway.

Clear and credible political signaling is therefore first pillar of deterrence in the Taiwan Strait.

Today, with so much uncertainty about the Trump administration’s plans and priorities, deepening U.S. engagement with Taiwan is more important than ever. Washington and Taipei are in a live trade dispute at the moment, with Taiwan now facing tariffs of 32%. Surveys show Taiwan’s trust in the United States falling sharply as the trade war pushes Taiwan deeper into domestic political dysfunction.

U.S. concerns about Taiwan’s currency manipulation are legitimate. But is this a more important concern than pressing Taiwan to improve its resilience? Washington should be showing Beijing and Taipei that it wants a closer trade, technology, and energy relationship with Taiwan, not just a smaller current account deficit. Washington can also do more to support Taiwan’s democracy, which Beijing is assiduously trying to undermine.

At the same time, United States must also continue to make clear that it opposes unilateral changes to the status quo in the Taiwan Strait. In accordance with its longstanding One China Policy, it must refrain from treating Taiwan as a formal treaty ally. It must never pressure Taiwan to engage in cross-Strait negotiations. It must resist Beijing’s attempts to move the goalposts by limiting longstanding forms of U.S.-Taiwan engagement—like transits by Taiwanese presidents. Washington should also retain its de facto policy of “strategic ambiguity” about the precise nature of its defense commitments to Taiwan.

While U.S. policy should not change, Washington should consider changing the way it communicates its ambiguous position, using a new concept that I call “structured ambiguity” to remind Beijing of some obvious facts.

The basis of the One China Policy is the Three Joint Communiqués signed by Washington and Beijing in the 1970s and 80s. Any PRC military action against Taiwan would flagrantly violate Beijing’s commitments. Thus, if the U.S. intelligence community concludes that Beijing intends to unilaterally alter the status quo, the U.S. President will inevitably need to re-evaluate the One China Policy at a fundamental level. This may include reinterpreting the policy in a limited and proportionate way to protect U.S. national interests while signaling a commitment to peace and stability. It may also include recalibrating longstanding limits on the U.S.–Taiwan political and military relationship.

In short, Xi Jinping must be warned that indefinite gray zone aggression against Taiwan will carry significant risks. If he provokes a brinkmanship crisis, Washington should make clear that it may act decisively to defend its interests before American lives are lost.

Structured ambiguity is a subtle position that will need to be communicated carefully. The United States is not seeking an excuse to abandon the One China Policy. It is seeking to deter Xi from fomenting gratuitous crises. Structured ambiguity will not deter full-scale invasion or blockade. But it might help provide crucial advance warning if Xi does decide to move against Taiwan, potentially offering Washington and Taipei vital days or weeks to prepare.

Finally, political deterrence involves showing solidarity with allies whose support would be essential in a crisis.

Washington should seek to align this political deterrence strategy with its core allies, particularly Japan, Australia, the UK, and Canada. It should institutionalize this coalition and move towards joint contingency planning and strategic communication. It should prepare a playbook to respond to China’s lawfare and push back in the UN and the court of international public opinion. It should appeal to neutral countries’ self-interests—but not preach or demand that other countries adopt the U.S. political position.

All of this gets harder if the U.S. suggests that the terms of its relationship with Taiwan are up for negotiation.

2. “Deterrence by denial”

The second pillar is conventional military “deterrence by denial.” China has various military options for moving against Taiwan, including bombardment, amphibious invasion, and blockade. The United States and its partners must maintain the ability to defeat them.

Attempting an invasion would be a massively complex and large-scale joint operation—a high-risk affair for a military without deep combat experience. The weakest links in the PLA’s invasion force are its logistics chain and amphibious ships. My colleagues Andrew Erickson, Conor Kennedy, and Ryan Martinson of the Naval War College’s China Maritime Studies Institute break this down clearly in their groundbreaking recent volume. There are relatively low-cost ways in which the United States and Taiwan can increase the risk and complication for PLA planning.

Because China enjoys quantitative advantages in key aspects of the military balance, including aircraft, surface ships, and missiles, maintaining conventional military deterrence is partly an exercise in psychological warfare against Xi himself. Xi must be made to ponder plausible reasons why his military would be unlikely to win if he chose to escalate or prolong a conflict. Maximizing U.S. technological superiority and maintaining a baseline level of allied defense industrial capacity will be essential to this effort, particularly over the longer term.

Deterrence by denial must also extend to the blockade scenario. It is probably not the best opening move for Xi to start a conflict with a blockade, but Xi may disagree. Any invasion of Taiwan would almost certainly involve an effort to stop Taiwan’s supporters from resupplying it with munitions, energy, food, and other essentials. Blockade remains a fallback option if an invasion fails. Persuading Xi that a protracted blockade would not be “checkmate” is the hardest part of conventional military deterrence.

If there is no credible allied plan to resupply Taiwan, and China imposes a blockade at any stage, Taiwan’s leaders might calculate that eventual defeat is certain, and thus capitulate quickly. Breaking a blockade by force could well require striking selected key targets inside mainland China and mining of China’s harbors, among other escalatory steps. Whether this would be advisable is a political decision for the U.S. president. Still, the U.S. president should ideally have an option to operationally defeat both a simultaneous invasion and blockade without nuclear escalation. This—not Taiwan’s currency manipulation—is what policymakers should be focusing on.

3. Strategic (not just nuclear) deterrence

The third pillar of deterrence is strategic. China is engaged in the fastest nuclear build-up since the early Cold War. China’s strategic deterrence doctrine is deliberately fuzzy, but it is clear that China sees strategic deterrence as extending beyond the nuclear domain to potentially include space, cyber, and economic threats. To maintain strategic stability, the United States must maintain a robust, cross-domain strategic deterrence system.

The U.S. president needs flexible options that signal both credible resolve and credible restraint—across the range of plausible peacetime, crisis, and conflict scenarios. Practically speaking, this means the United States should keep modernizing its nuclear forces and delivery systems, including by re-establishing the capability to build new warheads quickly if adversaries’ actions require it. The United States must remain strongly opposed to nuclear proliferation, but it may consider NATO-style “nuclear sharing” to bring South Korea and Japan closer to nuclear deterrence operations—if these two countries continue to request it for reassurance purposes.

Strategic deterrence extends across domains is no longer just about nuclear weapons. The United States must also act decisively to maximize its advantages in outer space. It should accelerate the transition to resilient satellite constellation architectures for command-and-control, communications, computers, intelligence, surveillance, and reconnaissance (C4ISR) and build and covertly display capabilities to hold China and Russia’s C4ISR at risk. Maintaining U.S. advantages in key AI capabilities and signaling them effectively to China could also strengthen strategic deterrence. We will talk about these issues in detail in future weeks.

The United States can make various economic threats that may or may not count as strategic deterrence. This might include tariffs, sanctions, attacks on the PRC financial system, and interdiction of trade. These threats are already on the table. We’ll talk about financial war (金融战争) scenarios in future weeks.

But economic mutually assured destruction is not interchangeable with nuclear MAD. It likely has a much weaker deterrent effect. A city can be vaporized, and once vaporized it can’t be un-vaporized. Neither principle holds true for an economy. Even the most extreme economic punishments can be lifted once they start to hurt, and economies can adapt around them. Threatening EMAD—let alone attempting it—also risks undercutting the political pillar of deterrence.

4. Economic contingency planning

The fourth pillar of deterrence is an affirmative economic contingency plan for a crisis. If supply chains in and out of China and Taiwan are disrupted even temporarily, the impact on global financial and macroeconomic stability would be enormous.

As the bipartisan House Select Committee on the Chinese Communist Party concluded bluntly in December 2023, “The United States lacks a contingency plan for the economic and financial impacts of conflict with the PRC.” Even if Washington had the power to stop other countries from trading with China—a dubious assumption—rapid economic decoupling would not be politically realistic or strategically productive.

The best way to communicate resolve in a crisis—and in the gray zone—is to communicate consistently and in advance how the United States would act to defend its own economic interests. Effective economic contingency planning must punish China only as a welcome byproduct of policies that advance other U.S. interests, which are shared by allied countries and neutrals alike. It is near-certain that China would keep trading with many U.S. trading partners during and after a potential Taiwan crisis. Contingency plans need to take this fact into account.

Reducing vulnerability to economic coercion also strengthen deterrence. America should focus on breaking critical dependencies first and addressing non-critical dependencies over time as part of a wider program of economic leadership. In a Taiwan crisis scenario, dramatic changes to the structure of the global economy would become possible, but they would be sustainable in the long term only if they minimized the economic pain on the United States and protecting the vital interests of key partner countries.

Integrating the pillars

Why can’t these four pillars of deterrence stand individually? Why do they have to be integrated?

Because a conflict with China over Taiwan could become protracted, and U.S.–China relations might never recover. This is why Taiwan’s will to fight is also a critical, yet often misunderstood, component of deterrence. While pre-war public opinion polls in Ukraine suggested only mixed willingness to resist Russian aggression, the full-scale invasion transformed Ukrainian society into a determined and cohesive fighting force. Taiwan’s future resilience may similarly depend on its leadership’s ability to inspire national defense, ensuring that any attempted invasion by China would be met with fierce resistance rather than rapid capitulation. While current U.S. war planning focuses on defeating a Chinese amphibious invasion within weeks or months, this narrow focus creates dangerous blind spots.

It is absolutely essential to disabuse Xi of the misapprehension that China could win simply by escalating a conflict until America loses resolve, or by dragging out the conflict until the U.S.-led coalition cracked. The United States must credibly show that its political and economic plan is robust: that Washington could harness the initial global reaction to the outset of a crisis, build a durable coalition, and structure the conflict on favorable terms for a potential long-term struggle.

Seen in this light, economic and political deterrence are not just supplementary measures but essential and interconnected pillars of integrated deterrence. In the heat of a crisis, the U.S. ability to deter a catastrophic war and secure an honorable peace will largely come down to whether Xi believes that U.S. threats are credible.

If Washington wants to deter conflict with China, it should not let Taiwan become a bargaining chip. Rather, it should hold the line and accelerate preparations for a crisis.

Integrated Strategy

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