Taipei Times: Although the government has claimed the case of semiconductor giant United Microelectronics Corp (UMC) is an isolated one, do you think existing laws are sufficient to deal with the matter? Is new legislation necessary? How does the government strike a balance between opening up China-bound investment and at the same time effectively managing it?
Frank Hsieh (
PHOTO; SEAN CHAO, TAIPEI TIMES
As we all know, many businesspeople risked breaking the law when the "no haste, be patient" economic strategy was in place when former president Lee Teng-hui's (
Since the DPP took power, the government has gradually liberalized the China-bound investment policy. My thinking is that the law has to be thoroughly enforced and that it is only fair to punish law-breakers according to the existing legislation. However, if the number of illegal acts is extremely high, there might be something wrong with the law, which will then require examination.
As far as the UMC case goes, it seems to be an isolated incident. The information I have received is that it happened about two or three years ago and was reported to the authorities about six months ago. Prosecutors are targeting the areas that appear most serious, involving sensitive technology and large capital investment. Prosecutors are acting in accordance with the law and their actions are not motivated by politics as some have speculated.
I don't think it's necessary to amend any law or regulation because of one single case.
TT: The Executive Yuan previously tried to push a technology protection bill to limit the export of sensitive technology and skills. This was criticized by opposition parties as "technological martial law." Since the new legislature is scheduled to convene on Friday, will the government once again send the bill to the legislature?
Hsieh: If there are serious differences between the opposition and ruling parties, we will negotiate first, and try to resolve any difficulty before sending it again.
However, I think the crux of the problem lies in cross-strait relations. China continues to intimidate us with its military might and both sides are still enormously hostile. As long as China continues its military buildup, we will be forced to purchase more weapons. The volatility of the situation is bound to increase if improvements are not made.
Cross-strait tensions have led many people to conclude that it's inappropriate to allow high-tech companies to move to the mainland. I believe that if the enmity is removed, both sides can cooperate economically and co-exist with each other.
Effort must be made by both sides, however. I hope opposition parties and the Taiwanese public realize that the proposed arms package is desperately needed because China has targeted us with missiles.
President Chen Shui-bian (
China's attitude is equally important. In addition to the missile buildup, China now plans to enact the "anti-secession" law. Although we are not entirely sure of its content, most believe it is meant to provide the legal basis for China to launch a military attack on Taiwan, which is in a state of separation. If the "anti-secession" law states that separation is not allowed, China can initiate hostilities at any time once the legislation is passed.
I'd also like to ask all those who condemn the government for attempting to buy weapons to speak just as loudly in demanding that China remove its missiles.
TT: Speaking of weapons, since you have said that you won't push highly controversial bills, how do you plan to tackle the arms procurement package? Will the NT$610.8 billion budget be adjusted downward?
Hsieh: We've been trying to negotiate with opposition parties, although it's a highly controversial bill and no consensus has yet been reached.
I am pleased to say that certain differences have been settled, such as whether the expenditure should be earmarked as a special or annual budget, and whether we should build some of the submarines ourselves. Apart from the opposition of the US government, which doubts our ability to do the construction, it's estimated to cost NT$100 billion more if we build them domestically. I hope the legislature re-examines its resolution to build submarines at home.
As to whether the budget will be adjusted downward, we still have to negotiate with the legislature. I don't have any problem with sending the same budget request and letting them do the trimming.
TT: Some have criticized as "unfair" your plan to increase the ceiling on indexed health insurance premiums and let the rich pay more. What do you think of this criticism?
Hsieh: A recent opinion poll shows that over 73 percent of voters support the measure. As the national health insurance program is, to some extent, a social insurance mechanism, I believe, as do other highly paid Cabinet officials, that it makes sense to have better-off Taiwanese pay more. The bottom line is that the program is only beneficial as long as society is stable, which is a more important consideration than how much the rich pay in their premiums.
If criticism of the new measure is justified, I'd like someone to explain how. I am not an expert on this, but I listen to the experts' opinions and do the calculations myself. It's not a good thing to listen to one person's opinion and assume that something is wrong.
The change should be made based on three convictions. First, the national health insurance program must continue to work because it is extremely convenient, especially for the underprivileged. Second, because national health insurance is a social program, government intervention is necessary and we are obliged to shoulder certain financial burdens. Finally, we have to come up with strategies not only to save money, but to generate more. I firmly believe our national health insurance policy is among the world's best.
In a bid to generate more money, we believe it is good to let the better-off pay a little more. While the current ceiling on indexed health insurance premiums is NT$87,600, it will be increased to NT$131,700. In other words, those who make NT$10 million a month will pay the same health premium as those who make NT$131,700.
I also believe the costs of promoting better health, education and disease prevention should be paid by the government rather than the health insurance program.
In addition, we have decided to raise the "health tax" on cigarettes. Our plan is to increase it from NT$5 to NT$10 per pack. It is estimated that such an increase will bring in an extra NT$1.5 billion to NT$2 billion each year. About NT$2 billion from air pollution fees will also be injected into the program.
In addition, we are considering requiring those responsible for public disasters, food poisoning, and major traffic accidents to pay the medical expenses of the victims. However, I don't think it is right to channel lottery revenues into the program.
I hope to finalize the measure on how to better execute the hospital transfer system and its supplementary plan by July 1 or Jan. 1.
With the implementation of all the measures, I hope we will be able to keep the health insurance program afloat for two or three more years before the second-generation health insurance policy is in place. I believe most people will approve of the measure.
TT: In addition to health insurance, you have pledged to push for tax reform, government restructuring, social security and constitutional change. Could you offer some insights on this?
Hsieh: While the amendments to the Executive Yuan's organic law failed to pass in the last legislature, I thought both the ruling and opposition parties might compromise a little. If it is impossible to get 100 percent, I hope both sides can settle for 80 percent. We will eventually re-submit the draft amendments to the new legislature.
Regarding tax reform, our taxation system is like this: there are 100 people who need drinking water, but there are only 60 people who are actually fetching it. In the past, when there was insufficient water, the 60 people were asked to get more.
What we're trying to do is to find out whether the 40 people can bring some water, maybe half a barrel or a cup. While the physically challenged, senior citizens, and those with low-incomes have difficulty paying taxes, others such as teachers and soldiers should be able to contribute. That is why I approved the amendment of the Income Tax Law (
In addition, I am considering asking others to pay a little bit more tax, including those investing in the electronics industry and retired high-ranking government or military officials.
Of course, we will negotiate with lawmakers to obtain support for the initiative. It's a waste of time to send a bill that is expected to be rejected.
Another thing I would like to point out is that I recently turned down the proposal to increase water and electricity fees, despite TaiPower's claim that it expects to lose NT$10 billion.
My theory is that there shouldn't be any increase in water and electricity fees when interest rates are lower than the increase in the price of consumer goods. Last year's consumer price index registered at 1.9 percent, while the interest rate was 1.5 percent. In other words, the interest you get from the bank is less than the increase of the price of consumer goods. [Under these circumstances] it doesn't make sense to raise water and electricity bills.
However, it doesn't necessarily mean that there won't be an increase in water and electricity fees. It will hinge on interest rates and the price of consumer goods. I don't think they deserve to be hiked if the price of consumer goods continues to rise. We can always make ends meet even when state-run businesses are losing money.
TT: Former DPP Chairman Lin I-hsiung (
Hsieh: I personally support a nuclear-free homeland. However, unless there is a new legislative resolution or a legally binding referendum favoring the cancellation of the Fourth Nuclear Power Plant, the Executive Yuan will honor the consensus reached in 2002 between the executive and legislative branches, together with a legislative resolution to continue construction of the facility and work toward a nuclear-free homeland in the future.
I understand Lin's stance on the matter and personally support his cause to mount a national referendum to decide the fate of the plant and build a nuclear-free homeland. However, it is impossible for the Executive Yuan to alter the legislative resolution.
TT: The president has extended numerous goodwill gestures to China. Do you think cross-strait policies are overly optimistic?
Hsieh: It is the president's legal duty to deal with cross-strait, foreign and defense polices. I believe he obtains more comprehensive intelligence than I do to help him make the most effective decisions. It is inappropriate for me to say that his judgment is wrong.
TT: What do you think of the president's previous proposal of enacting an "anti-unification law" or mounting a referendum to counter the "anti-secession law?"
Hsieh: My understanding of the president's remarks is that if China insists on enacting such a law, it is bound to trigger a backlash from the Taiwanese people. He did not ask the government to do anything to counter the proposed legislation. However, the media distorted President Chen's remark in such a way that the international community thought he was trying to exacerbate already volatile cross-strait relations.
What the president said about setting off a counterattack from the Taiwanese people is correct. When the media asked him about it, he mentioned several options including enacting an "anti-unification law" or a new Constitution. He also cautioned that a retaliatory response is not conducive to cross-strait stability and world peace. He called on the international community to heed China's provocative action.
TT: Do you think that Taiwan would compromise its political status by accepting the "1992 consensus?" If Taiwan doesn't accept the "1992 consensus," how do you plan to resolve the cross-strait stalemate?
Hsieh: I personally think that there's no direct connection between the "1992 consensus" and resumption of cross-strait talks. Taiwan and China are preoccupied with this issue. They should extract themselves from fruitless adherence to their respective positions and move on to more constructive topics.
Take, for example, the negotiation on charter flights for the Lunar New Year. These succeeded without reference to the "1992 consensus." Even if there was a "1992 consensus," no cross-strait talks would be conducted if one side refused to talk.
While both sides have been debating its existence for years, what it amounts to now is saving face. Neither side wants to appear to surrender to the other.
The "1992 consensus," in my view, is just a pretext for the lack of trust between the two sides. If both sides are serious about picking up where we left off, cross-strait talks can be resumed even without the "1992 consensus."
One must bear in mind that there was no consensus before the so-called "1992 consensus" was reached. Why do we need it now?
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