President Ma Ying-jeou (馬英九) has the lowest presidential approval rating in the history of this nation. The problem is that he has neglected the public’s real needs and concerns while only paying attention to superficial numbers and propaganda. His administration has become a government that only knows how to makes slogans, but very little about public misery. Hence, it is ineffective and has fallen into public disfavor.
The Ma administration recently directed all government ministries and agencies to aggressively promote the idea that the nation has become a happier place during its seven years in office. It is a blatant attempt to turn the public’s feelings around — and as absurd as it sounds, it has been the modus operandi of Ma all along.
The reality is that since Ma took office, he has failed to deliver on any part of his “6-3-3” pledge of achieving an annual GDP growth of 6 percent, an annual per capita income of US$30,000 and an unemployment rate of less than 3 percent.
For the past seven years, Taiwan’s unemployment rate has topped the four Asian Tigers, the real average wage has fallen back to the level it was 16 years ago and the average economic growth rate is lower than when former president Chen Shui-bian (陳水扁) was in office.
Housing prices are soaring, the gap between the wealthy and the poor is widening, the national debt is increasing and political corruption has become prevalent.
Over the past seven years, Ma has done his best to be as obsequious as possible toward China, leaving Taiwan directionless and the public disoriented.
These are the reasons why the public is upset. Only through self-reflection and by correcting wrong policies can the government win back the hearts and minds of the public.
Unfortunately, this is not what is happening. The government now wants to use taxpayers’ hard-earned money to further deceive the public, and that will only backfire and cause more discontent.
The Ma administration’s biggest blind spot is its lack of core values and ideals. Short-term election victories are its main concern, while a long-term vision for national development is brushed aside, and the enthusiasm and resolution required for reform remain absent. Whenever a problem arises, the issue is dealt with in a perfunctory manner by responding with another slogan, a trick that the public learned to see through long ago.
Two recent events clearly illustrate how the Ma administration only cares about paying lip service and propaganda.
First, Minister of Finance Chang Sheng-ford (張盛和) said that the nation’s mandatory spending level is too high at 70 percent of the government budget, leaving the state with fewer funds to invest in infrastructure for national development.
However, the reason that mandatory spending and hidden debt are too high is that pension funds for retired military personnel, civil servants and public school teachers are too generous.
In the past, Ma put on a show to display his willingness to reform the state pension system, but backed down after taking into account the voting power of these groups.
In fact, although military personnel and public servants might be affected by pension reforms, the proposed cuts would not leave them starving or homeless, and their living standard in retirement would still be better than the average person.
Moreover, most military personnel and public servants understand what best serves national interests and that with this unreasonable system in place, national finances will be unsustainable. If the nation goes bankrupt like Greece, all the benefits that they enjoy will disappear in a puff of smoke. Only a reasonable pension system is able to serve the interests of the military and public servants. However, the Ma administration has been held hostage by a minority of legislators with military connections or backgrounds and it has given up on reform.
Second, the Chinese Nationalist Party (KMT) caucus’ controversial “four laws for pay raises” proposal once again highlights the Ma administration’s reckless nature and lack of comprehensive planning as it is only focused on winning votes. The proposal refers to draft amendments to the Company Act (公司法), the Factory Act (工廠法), the Labor Standards Act (勞動基準法) and the Small and Medium Enterprises Development Act (中小企業發展條例) that would require companies to distribute surpluses, if any, to employees in the form of pay increases and bonuses.
Since the real average wage has fallen back to the level it was 16 years ago, young people seem cursed with a low starting monthly salary of NT$22,000 and low wages have become a serious social problem. If enterprises can put aside a portion of their profits as bonuses for employees, the whole nation would be pleased to see that.
However, pay raises are different from the minimum wage, which is designed to meet basic survival needs. It is thus legitimate for the government to get involved and regulate the minimum wage.
Pay raises or bonuses, on the other hand, belong to the realm of corporate governance and should be managed in line with a company’s business operations and industry environment. If the government meddles too much, it would leave companies little room to make adjustments, leading to strained labor-management relations and therefore defeat the purpose of the legislation.
The nation’s low wage problem is not caused by corporations’ unwillingness to increase wages, but rather the industry structure and policies, which should be the focus of government review to tackle the root of the problem.
These matters have been discussed again and again. For example, Taiwanese industry consists mostly of original equipment manufacturers that lack branding and innovation, which is why they cannot produce higher value-added products. These industries have low entry barriers, which is why they are involved in cutthroat price competition, resulting in low gross profit margins of 3 to 4 percent. With this kind of industry structure, where profits are low, labor expenditure becomes crucial, leaving little room for pay raises.
If pay increases are imposed through legislation, competitiveness will be lost, and companies might go bankrupt and close down. Workers then become the victims.
Offshoring is widely practiced in Taiwan. Offshore production accounts for more than 50 percent of Taiwanese exports. Job opportunities are largely created overseas and operating profits are only shared with shareholders. The economic growth created by industries whose sites are predominantly located overseas creates a pseudo-prosperity for Taiwan. If these companies are forced to raise their wages by law, this will only benefit overseas workers, the majority of whom are Chinese, while doing little good to Taiwanese workers.
Ma has been in office for seven years and has made innumerable flawed policies during this time. History will remember his indisputable ineptitude.
Recent declassified documents from the Taipei City Government have raised questions about several tenders made during Ma’s tenure as city mayor. The rampant and pervasive corruption of government officials under his rule has shattered the illusion of his clean image.
Ma has proven to be an incapable and controversial president. His days in office are numbered, but he has yet to reflect on his mistakes. He is still scheming and plotting to settle scores, filling the nation with insecurity and uncertainty in the last year of his tenure.
Translated by Ethan Zhan
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