President Ma Ying-jeou (馬英九) has pledged not to support Kuokuang Petrochemical Technology Co’s proposed naphtha cracker plant in Changhua County. He also told the petrochemical industry that the government cannot and will not give up on the sector. Whether Kuokuang will now build the plant in Taiwan remains unclear.
However, the debate on the Kuokuang plant should not be treated as an issue involving only the petrochemical sector, because it relates to the nation’s overall development strategy. Should development focus on economic growth, or should it seek to optimize public happiness?
The pursuit of economic growth and satisfying material desires has dominated mainstream thinking since the Industrial Revolution. Western academics once listed two engines — the steam engine and economic growth — as the two greatest inventions of the 18th century. Moreover, GDP, which measures economic growth, has been transformed from an economic indicator into a symbol of national status, with high growth implying a move toward wealth and joining the ranks of the advanced nations.
However, GDP still only measures economic activity within a country or region, not health, education, social welfare or the social costs incurred as a result of economic development. A country with high economic growth, but unsound social welfare and health insurance systems, a large wealth gap, heavy environmental pollution and poor quality of life does not deserve to be called an advanced country.
Focusing too much on economic growth can have serious side effects. As natural resources are gradually exhausted and environmental quality declines, disasters become more frequent. For example, when Japan experienced high economic growth, it built a dense network of nuclear power plants to satisfy its soaring demand for energy, and that ultimately contributed to the nuclear crisis brought on by the recent earthquake.
Massive wealth created by economic growth has historically been concentrated in the hands of a few and as the distribution of wealth became less equal, it set off numerous riots, revolutions and the rise of communism, causing untold suffering. This was all a direct consequence of placing the economy first.
As a result, there has been much soul-searching. The king of Bhutan proposed a Gross National Happiness index in the belief that national policies should focus on public happiness. Although this index is just a reference, not a Utopian ideal to be pursued in today’s global world, those in power should consider how best to promote development by seeking to balance economic growth, cultural development and environmental protection.
Taiwan’s development was focused on economic growth to such an extent that GDP became almost the only index used to judge government performance, making economic growth a symbol of the Taiwanese miracle.
For several decades, the nation’s annual economic growth has been almost constantly positive, but looked at from the perspective of distributive justice, environmental protection and social welfare, many say the pursuit of economic growth is no longer able to bring greater happiness to Taiwanese.
Employment is a precondition for the creation of a happy society because individuals can only give full rein to their potential once their basic needs are fulfilled. Taiwan’s unemployment is quite serious and despite massaging by the government, remains at almost 5 percent.
Despite average economic growth of between 4 percent and 5 percent over the past decade, the average salary has dropped to the levels of 12 or 13 years ago. In other words, economic growth has not benefited incomes or boosted employment, because businesses have been relocating, especially to China. The outflow of jobs has meant that the general public has not shared in the fruits of economic growth.
The distribution of wealth is becoming increasingly unfair as the income gap between rich and poor grows. Although this is a global trend, it is so serious in Taiwan that it can longer be ignored. According to data from the Ministry of Finance’s Financial Data Center, which divides taxpayers into 20 groups according to 5 percent gradations, the average annual income of the poorest 5 percent of taxpaying households in 2009 was NT$51,000 (US$1,780), while that of the wealthiest 5 percent was NT$3.822 million. In other words, the wealthiest 5 percent earner nearly 75 times more than the poorest 5 percent, up from 65 times in 2008.
From unemployment, low wages and the widening income gap, to heavy environmental degradation, the cost of economic development has been borne by a majority of the public, while only a relative few have enjoyed its benefits.
Taken to extremes, this pattern is an unavoidable source of social unrest. If we do not review the ideology and policies that place the economy before everything else and fail to focus on upholding the values of humanism, environmental protection and social justice, in order to pursue the happiness of the majority by using happiness as a development index, then Taiwan could soon face a domestic crisis.
Viewed from this perspective, the proposed Kuokuang plant and fourth nuclear power plant are not isolated incidents. The way we handle these proposals will demonstrate whether we recognizes the flaws inherent in the nation’s former development model and are now prepared to embrace an approach to development that focuses on optimizing the happiness of a majority of Taiwanese.
Translated by Eddy Chang
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