US President George W. Bush has signed into law a massive bailout package for US financial institutions. The bill had initally been rejected by the House of Representatives amid concerns that spending US$700 billion of taxpayers’ money to buy up questionable assets and bail out financial companies was not socially just. However, after measures were added to protect the interests of the middle classes, such as tax cuts and exemptions, among other additions, the bill was approved by both houses of Congress.
President Ma Ying-jeou’s (馬英九) administration has also been confronting a financial crisis. How does its attitude compare to that of US officials? Ma’s government has proposed a series of measures to boost the economy and stock markets. On Sept. 9 it put forward 10 proposals to revitalize the economy, but the package fell short on policies beneficial to the public at large. The government does not seem to care much about the middle class. No wonder people are growing more concerned about social injustice and less confident in the government.
The Finance Ministry’s Tax Reform Committee is scheduled to meet today amid widespread calls from industrial and commercial interests for tax cuts to help the economy. The financial team set up by the Presidential Office has not come up with any measures to revive the stock market. It has only suggested cutting inheritance and gift taxes and setting up a sovereign wealth fund, and it seems likely that the Tax Reform Committee will act in accordance with these signals. These are tax cuts for the rich, however, and only serve to shift even more of the tax burden onto the shoulders of the less affluent.
Taxation in Taiwan is not well balanced. Most government revenue comes from income taxes. Many high earning companies and individuals pay very little tax because there are so many deductions and exemptions. Sometimes the extremely wealthy manage to pay less tax than the average office worker. Taiwan Semiconductor Manufacturing Corp chairman Morris Chang (張忠謀) has repeatedly called on wealthy Taiwanese to bear a fairer share of the tax burden. The finance ministry is aware of the situation, but unfortunately has been insensitive to it, so government policy continues to favor the wealthy.
The government knows that the deteriorating economic situation is causing ever greater income disparity and the Ministry of the Interior has proposed a plan to subsidize families whose monthly household income falls below NT$25,000. But recipients would be chosen by computer, which means they might include teachers and military personnel, who are already exempt from taxes, while those in real need are left out. This does not meet demands for social justice, but all Minister of the Interior Liao Liou-yi (廖了以) can say is, “better luck next time.”
Even in the US, which always has stressed the importance of free markets and a free economy, lawmakers managed to squeeze measures to benefit the disadvantaged and the middle classes into its bailout plan. It makes you wonder whether Taiwan’s government — which stressed liberalization and deregulation when it took office — cares about growing income disparity nationwide and whether it has heard the complaints of the disadvantaged and the middle classes who lack the political strength to challenge the government’s financial and economic policies.
The conflict in the Middle East has been disrupting financial markets, raising concerns about rising inflationary pressures and global economic growth. One market that some investors are particularly worried about has not been heavily covered in the news: the private credit market. Even before the joint US-Israeli attacks on Iran on Feb. 28, global capital markets had faced growing structural pressure — the deteriorating funding conditions in the private credit market. The private credit market is where companies borrow funds directly from nonbank financial institutions such as asset management companies, insurance companies and private lending platforms. Its popularity has risen since
The Donald Trump administration’s approach to China broadly, and to cross-Strait relations in particular, remains a conundrum. The 2025 US National Security Strategy prioritized the defense of Taiwan in a way that surprised some observers of the Trump administration: “Deterring a conflict over Taiwan, ideally by preserving military overmatch, is a priority.” Two months later, Taiwan went entirely unmentioned in the US National Defense Strategy, as did military overmatch vis-a-vis China, giving renewed cause for concern. How to interpret these varying statements remains an open question. In both documents, the Indo-Pacific is listed as a second priority behind homeland defense and
Every analyst watching Iran’s succession crisis is asking who would replace supreme leader Ayatollah Ali Khamenei. Yet, the real question is whether China has learned enough from the Persian Gulf to survive a war over Taiwan. Beijing purchases roughly 90 percent of Iran’s exported crude — some 1.61 million barrels per day last year — and holds a US$400 billion, 25-year cooperation agreement binding it to Tehran’s stability. However, this is not simply the story of a patron protecting an investment. China has spent years engineering a sanctions-evasion architecture that was never really about Iran — it was about Taiwan. The
In an op-ed published in Foreign Affairs on Tuesday, Chinese Nationalist Party (KMT) Chairwoman Cheng Li-wun (鄭麗文) said that Taiwan should not have to choose between aligning with Beijing or Washington, and advocated for cooperation with Beijing under the so-called “1992 consensus” as a form of “strategic ambiguity.” However, Cheng has either misunderstood the geopolitical reality and chosen appeasement, or is trying to fool an international audience with her doublespeak; nonetheless, it risks sending the wrong message to Taiwan’s democratic allies and partners. Cheng stressed that “Taiwan does not have to choose,” as while Beijing and Washington compete, Taiwan is strongest when
RSS