China unlikely to pay local retirees

By John Lim 林泉忠  / 

Sat, Jul 14, 2018 - Page 8

The news that a Chinese think tank is working on a plan to offer a NT$10 billion (US$327.3 million) subsidy to make up for the difference between the original retirement payments of military personnel, civil servants and public-school teachers and those following the reformed pension system has led to heated debate.

The debate is focusing on whether it would be possible and, if so, how it should be implemented. As the source of the news, I think that the political implications of the idea are a more important issue.

Based on the understanding of my source on the NT$10 billion subsidy idea, knowledge of how far the study has come and cross-strait realities, implementing such a subsidy seems very difficult, as Beijing has no administrative control over Taiwan. Even with sufficient capital and staff to implement it, it is a “mission impossible.”

First there is the technical aspect. The government would never give China all the data about the 330,000 civil servants. Even ignoring political factors, doing so would contravene the Personal Information Protection Act (個人資料保護法).

This means that if China would try to force this through, it would have to rely on information provided by applicants, which raises the question of how they would evaluate the truthfulness of such information and calculate the correct payment for each applicant.

Then there is the policy aspect. If such a policy were directly implemented and managed by the Chinese government, it would also depend on the willingness of Chinese taxpayers. Insufficient retirement payments to China’s own veterans have lately caused social unrest, placing Beijing under pressure.

This means that if the policy concept is to be implemented, it would have to be operated by a private foundation. However, even if that were the case, the management would involve direct Chinese administration of Taiwanese, which could lead to management problems or dissatisfaction with the size of the subsidy.

If Taiwanese were to resort to the kind of demonstrations that occur in democratic Taiwan, such as those held by the 800 Heroes veterans’ group, the Chinese government would probably find that difficult to manage.

In addition, there are the Taiwanese government’s possible countermeasures, such as punishing any applicants by canceling their pensions. However, regardless of the likelihood that a Chinese NT$10 billion subsidy would actually be implemented, the political implications of the idea must not be ignored.

It goes without saying that the goal of such a subsidy would be to score political points by highlighting the Democratic Progressive Party administration’s inability to care for civil servants while at the same time showing the “Chinese motherland’s concern for the well-being of the Taiwanese compatriots” and that China is “the motherland that provides true support for Taiwanese.”

Since this subsidy would be based on political considerations, it would not be unconditional.

When Taiwanese students at some Chinese universities apply for grants, they would need to write a letter of consent stating that they “identify with ‘one China’ and support the unification of the motherland.”

Furthermore, while they are recipients of a grant, they must not violate the pledge made in the letter of consent. If they do, the grant will be canceled and they might even have to return the sum already received.

The suggested subsidy highlights my suggestion that an analysis of the era of Chinese President Xi Jinping (習近平) must look at how China uses a new “direct power approach” to address the “Taiwan question.”

On the one hand, the new “direct power” approach stems from the failure of traditional “united front” strategies to win over Taiwanese, in particular as politics and society have become increasingly Taiwan-centric since the 1990s.

As Beijing sees it, the situation has reached a dangerous, hard-to-reverse stage and it is necessary to come up with new thinking.

On the other hand, Beijing is on the way up and as a result is growing economically stronger. At a time when there is a growing power imbalance between the two sides of the Taiwan Strait, that gives Beijing even more room to influence Taiwanese society.

The “direct power” approach focuses on using economic strength as leverage to gradually integrate Taiwan into China’s social and administrative framework to achieve substantive cross-strait unification.

If the 31 incentives for Taiwanese that China presented in February are intended to attract young Taiwanese to China and become integrated in Chinese society, then the NT$10 billion subsidy, which would not only target Taiwanese living in China, shows that the next stage of China’s Taiwan policy, focusing on the “direct power” approach, is being expanded to include the majority of Taiwanese who remain in Taiwan.

Simply put, even though it is unlikely that a NT$10 billion subsidy will be implemented, the idea’s imaginativeness and inventiveness reflects the strength of Xi’s “direct power” approach and that it is going beyond what anyone in Taiwan had been able to imagine.

It is likely that we will see a series of policies based on the idea of “direct power,” and finding ways to calmly and firmly address and neutralize these policies will be a test of the government’s and of society’s cohesion, endurance and ability to respond.

John Lim is an associate research fellow in Academia Sinica’s Institute of Modern History.

Translated by Perry Svensson