After Jiang Yi-huah (江宜樺) took over as premier last month, Democratic Progressive Party (DPP) Chairman Su Tseng-chang (蘇貞昌) set a “3-4-5” goal for the Cabinet this year: A 3 percent increase in the average salary, an unemployment rate below 4 percent and an economic growth rate above 5 percent.
The Chinese Nationalist Party (KMT) responded by launching a publicity campaign saying that Su would be responsible if the government fails to reach a 5 percent rate of economic growth by the end of the year.
Leaving aside the issue of which party is in charge and should be taking responsibility; is aiming for 5 percent economic growth too high a target?
Currently, Taiwan’s GDP per capita is less than half that of the US or Japan, and much lower than that of Hong Kong and South Korea. However, demanding a nation, whose economic growth rate is lower than that of other advanced countries, maintain a medium or high rate of economic growth is not an excessive demand. A 5 percent economic growth rate should be the minimum, especially since an economic downturn is often followed by a rebound.
Despite its incompetence in developing the economy, President Ma Ying-jeou’s (馬英九) administration is good at playing the numbers games when dealing with economic policy to fool the public.
It never talks about past negative growth, but highlights the 10.76 percent economic growth rate of 2010 without mentioning that the boom was the result of a rebound following a drop in growth.
This information helped Ma in the presidential election last year and is why the government was not worried when the economic growth rate fell nine times last year: It knows a downturn will be followed by a rebound, and that the worse the downturn, the greater the rebound.
The government is certain to repeat the same trick to once again deceive voters in the local elections next year.
As the base period is so low, it should not be a problem to achieve economic growth rate of 5 percent this year. The government is forecasting a 3.8 percent economic growth rate this year, so when it demands that Su take responsibility if it cannot achieve 5 percent growth, it is trying to trick the public into thinking that this is no easy task.
The government will then repeat the show it put on last year and increase the forecast nine times to convince the public that is doing a good job.
This is something the opposition parties have to be prepared for.
Keeping unemployment below 4 percent should also be easy, because more Taiwanese are working in China.
If Beijing reaches out a helping hand by allowing Taiwanese companies in China to hire more Taiwanese workers, the jobless rate would decline immediately.
Statistically, Taiwanese working in China are categorized as “employed.” This statistical method fails to distinguish between those employed at home and abroad, and has been harshly criticized for years. Still, this is in line with Ma’s goal of eventual unification with China.
What Jiang’s Cabinet really needs to work hardest at is the demand for an average 3 percent salary growth, because this affects the profits of Taiwanese businesspeople both in Taiwan and China.
However, since the average Taiwanese salary has dropped to the level it was at 14 years ago, it should not be very difficult to achieve a 3 percent increase each year.