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Strange7 comments on Unpacking the Concept of "Blackmail" - Less Wrong
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The blackmailer has the option of backing down at any point, and letting you go for free. It may be unlikely, but it's not logically impossible.
"Give me $1000 or I'll blow up your car!"
"I have a longstanding history of not negotiating with terrorists. In fact, last month someone slashed my tires because I wouldn't give them $20. Check the police blotter if you don't believe me."
"Oh, alright. I'll just take my bomb and go hassle someone more tractable."
Assume it is, as part of the problem statement. Only allow agent-consistency (the agent can't prove otherwise) of it being possible for the other player to not blackmail, without allowing actual logical consistency of that event. Also, assume that our agent has actually observed that the other decided to blackmail, and there is no possibility of causal negotiation.
(This helps to remove the wiggle-room in foggy reasoning about decision-making.)