Under certain conditions both the opponents and supporters of an autho
ritarian regime can benefit from the peaceful liberalization of the re
gime. The literature on transitions to democracy emphasizes the role o
f negotiated deals (pacts) in facilitating transitions. Political deal
s are not legally enforceable contracts; they are subject to opportuni
sm by one of the parties. I examine how punishment of the ex-ruler(s)
by a successor government after power has been transferred renders a p
act ineffective and prevents a peaceful transition. Political asylum c
an alleviate the punishment dilemma, but the host nation can have an i
ncentive to renege on its protection. A military government retains th
e power to reintervene in politics after transferring power to civilia
ns. The possibility of reintervention allows the military to ensure co
mpliance by other parties and overcome the punishment dilemma.