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The 1996 deployment of two U.S. carrier battle groups to the waters off Taiwan in response to the firing of Chinese missiles close to Taiwan's shores brought home suddenly the genuine danger of a military clash between the United States and China over the Taiwan issue. This is an assessment of the intractable differences between Beijing and Taipei over the status of Taiwan, the rise and growing strength of an opposition party advocating Taiwan independence, and Beijing's threat to use military force to prevent independence. At the same time, it weighs the moderating influence of investment and trade across the Taiwan strait and the re-opening of cross-strait dialogue. Robert Clough warns against a U.S. commitment to intervene militarily against any Chinese use of force, which could encourage Taiwan to expect U.S. backing if it declared independence; nor should Washington renounce military intervention, which would give the P.R.C. a free hand. Instead, Clough argues for a policy of ambiguity, providing the United States with the flexibility to intervene militarily or not as circumstances dictate and at the same time giving more active approval and support to cooperation between the people and governments on both sides of the strait.