President Ma Ying-jeou’s (馬英九) second term in office has only just begun and he has already lost a member of his Cabinet, because of a run-in with Ma himself.
According to Chinese Nationalist Party (KMT) Legislator Wu Yu-sheng (吳育昇), former minister of finance Christina Liu (劉憶如) complained to him that Ma had failed to step in and ensure the integration of government policy after she had been trying to introduce the capital gains tax which Ma himself had called for.
It seems, then, that the U-turn on capital gains tax policy happened because Ma buckled under pressure from corporate interest groups and decided to sacrifice the rook to save the king. The upshot of all this political intrigue is that the controversial tax has been sacrificed in the most farcical way.
The question is: Did Liu really believe, when she was pushing for the capital gains tax, that Ma would roll up his sleeves and make sure the way was clear for her? It is true that he did swear, just as he secured his second term and with his hands unbound by any electoral pressure, to embark on bold and decisive reforms as testament to his commitment to leading the nation. Nevertheless, Liu clearly took Ma too much at his word, and overestimated his ability to push through controversial reforms. As a result, she believed — mistakenly as it turned out — that the capital gains tax was sure to go through.
This would have been quite a triumph for her, for not only would it have been good for her reputation, but it would have also restored, to a degree, the sullied reputation of her mother, former minister of finance Shirley Kuo (郭婉容), who also lost her position when tax legislation she tried to introduce went famously awry.
Who was to know, as Liu herself has conceded, that just as she was preparing to serve up the main course of the reform, fuel and electricity price hikes would appear out of the blue to mess everything up? She, for one, was left wide-eyed in disbelief, but surely this has all been part of Ma’s meticulous masterplan from the start?
From ractopamine-laced US beef imports to price hikes through to the capital gains tax, Ma wiped away — in one fell swoop — the Teflon label he had once so cherished: one he believed he could use to forge a new persona, one that would combine wisdom, courage and resolve, to secure his historic legacy.
With what ensued, however, it was Ma’s turn to gaze on bewildered as his multi-faceted plan came to naught and collapsed in on itself with his popularity rating plummeting to 15 percent. Public discontent forced him to personally announce phased-in electricity price hikes, rather than the one-off increase that had been planned, and throw Taiwan Power Co chairman Hwang Jung-chiou (黃重球) to the lions. Yet, he still could not bring the flames under control.
As the TAIEX continued to slip and stock transactions fell to a three-year low, Ma’s Reform Roadshow was showing every indication it was running out of road. The only option left to him was to set the legislative dogs upon his minister of finance to clear up the mess that had been made of the capital gains tax.
Ma’s way of going about policymaking has demonstrated again that just as the price of goods goes up, so power can decline, and when rulers willfully squander the power invested in them, the electorate can withdraw it again. As trust in Ma collapses he will find himself hobbled. Even the pro-blue press is turning away.