For 12 long years, every administration that has occupied the Presidential Office has failed to do what was necessary to ensure the nation could keep pace with a rapidly changing world. The cost of such inaction is becoming increasingly salient and will become heavier still, with the risk that Taiwan will become obsolete not as a result of political isolation, but from an irreversible exodus of brainpower and capital.
Former president Chen Shui-bian’s (陳水扁) Democratic Progressive Party (DPP), which came to power on May 20, 2000, after 53 years of uninterrupted Chinese Nationalist Party (KMT) rule, came in as a left-of-center party, proposing a more socialist alternative to the conservatism of the KMT.
However, neither the unfavorable context that arose from the Sept. 11, 2001, terrorist attacks, nor Chinese obstructionism or the party’s lack of ruling experience can fully account for the little that the Chen administration, over the two four-year terms it was given, had to show when it comes to modernizing Taiwan.
Chen’s failures stemmed instead from an inability to see how quickly economies around Taiwan were changing. Progress was undoubtedly made, as with the small, initial steps that were taken to normalize trade relations with China, the signing of free-trade agreements (FTA) with allied nations like Nicaragua and Taiwan’s accession to the WTO in 2001.
However, much more could and should have been done to bring Taiwan into the 21st century by creating a business environment that would attract — and equally importantly, retain — human capital. Instead, Chen remained fixated on socialism and protectionist measures that, though they may have made sense 20 years earlier, no longer did so. Tsai Ing-wen (蔡英文), the party’s candidate in the presidential election this year, ran on similar ideology, which failed to unseat President Ma Ying-jeou (馬英九) of the KMT.
That is not to say that more equitable wealth distribution or protecting certain sectors of the economy are intrinsically wrong policies. The problem is that Taiwan does not exist in a vacuum, and such measures cannot work in a region whose economies are rapidly evolving toward integration.
The KMT, which unseated the DPP in 2008 on promises it would “revitalize” Taiwan’s economy after eight “wasted years,” has not fared any better. Ma, who was given a second term in January, has done far more to liberalize relations with China, with 16 agreements and the Economic Cooperation Framework Agreement (ECFA) of June 2010, but none of those were visionary. In many respects, they simply built upon the foundations set by his predecessors, and all were long overdue, irrespective of the political dispute that exists between the two sides of the Taiwan Strait.
The Ma administration has been obsessed with China, often at the detriment of trade relations with other important economies. More fundamentally, even under his supposedly pro-business administration, his government has completely failed to address the numerous problems that continue to hurt Taiwan’s economy, deficiencies that go well beyond cutting GDP forecasts or sagging exports. Ma’s failures, like Chen’s before him, are the result of his inability to normalize the business sector and to confront interest groups that hold the nation hostage for the sake of maintaining their advantage over external competitors.
This is not only the insurance sector, to name one area that sorely needs an overhaul, but also education, where university professors continue to enjoy an unfair advantage over foreign talent. For example, only Republic of China (ROC) citizens can have tenure at public universities, which means that top foreign academics, or those with dual nationality, will have little incentive to come to Taiwan, a problem that is exacerbated by uncompetitive wages. The same applies to other sectors, where pay packages or opportunities for career progression are generally sub-optimal for Taiwanese and expatriates alike.
Think tanks, which serve as laboratories for ideas and influence on government, have little if any foreign input, which signals an inwardness that simply does not jibe with Taiwan’s perception of itself as strategically relevant. Firms involved with due diligence or financial investigation, wire news agencies, major newspapers, all are in China, Hong Kong, Singapore, Tokyo or Seoul, and will only parachute someone into Taiwan when something big happens, like major elections or natural catastrophes.
Taiwan remains a wonderfully attractive place to live, with an unbeatable quality of life. Unfortunately, its leaders — political and from the corporate world — still think in the short-term and seem incapable of imagining that top researchers, academics, journalists and scientists would want to develop a permanent presence here. They still think of Taiwan as a destination for, say, short-term English teachers who will eventually move on to better things. This is unfortunate as a sizeable number of highly skilled individuals currently working in China would much rather work in Taiwan — if the conditions were right. Sadly for them and for Taiwan, such conditions do not, for the most part, prevail here.
As a result, the top minds, domestic and foreign, that could help Taiwan modernize itself have little interest in coming here or staying for the long term. Major firms that could consider Taiwan’s safe environment and location to establish a regional office often end up going somewhere else because of the lack of a level playing field and unfair treatment vis-a-vis local firms. Some gave it a shot, especially in the wave of optimism that accompanied Ma’s election in 2008, but many more are on the brink of pulling the plug.
More often than not, an unfair business environment is the principal reason, along with growing fears in the high-tech sector — Taiwan’s lifeline — of tech transfer to China. While the Ma administration is aware of this (Tsai’s think tank acknowledged as much recently), there is little cause for optimism when Ma says that Taiwan will not be ready to join the Trans-Pacific Partnership for another eight years, a clear sign that he is unwilling to do what’s necessary to address the structural problems that undermine Taiwan’s economy.
Tackling interest groups will not be easy and will have political costs domestically. However, this needs to be done, lest Taiwan fall behind in a region that cannot, and will not, stand still. Chen, and now Ma, have failed to display the kind of leadership that is needed to ensure Taiwan’s economic survival and prosperity. What is needed now, more than ever, is a leader who has the vision and gumption to take the bold steps that the situation calls for.
J. Michael Cole is deputy news editor at the Taipei Times.
The People’s Republic of China (PRC) has over the past few months continued to escalate its hegemonic rhetoric and increase its incursions into Taiwan’s air defense identification zone. The US, in turn, has finally realized how its “strategic ambiguity” is increasingly wearing thin. Similarly, any hopes the US had that the PRC would be a responsible stakeholder and economic player have diminished, if not been abandoned. Taiwan, of course, remains as the same de facto independent, democratic nation that the PRC covets. As a result, the US needs to reconsider not only the amount, but also the type of arms
Taking advantage of my Taipei Times editors’ forbearance, I thought I would go with a change of pace by offering a few observations on an interesting nature topic, the many varieties of snakes in Taiwan. I will be drawing on my experiences living in Taiwan five times, from my teenage years in Kaohsiung back in the early sixties, to my last assignment as American Institute in Taiwan Director in 2006-9. Taiwan, with its semitropical climate, is a perfect setting for serpents. Indeed, one might say serpents are an integral part of the island’s ecosystem. Taiwan is warm, humid, with lots of
China constantly seeks out ways to complain about perceived slights and provocations as pretexts for its own aggressive behavior. It is both victimization paranoia and a form of information warfare that keeps the West on the defensive. True to form, China objected even to the innocuous reference to Taiwan at April 16’s summit meeting between US President Joe Biden and Japanese Prime Minister Yoshihide Suga. Neither leader’s prepared remarks even mentioned Taiwan, out of deference to the Japanese side. Biden’s opening statement was modest: “Prime Minister Suga and I affirmed our ironclad support for US-Japanese alliance and for our shared security.
There is no ambiguity when it comes to war. Ambiguity begs for certainty and a lack thereof has historically led to war. History is full of examples: Europe’s and the US’ ambiguity as to how they would respond to Hitler’s growing territorial expansion in Europe was certainly a contributing factor to World War II. In the same vein, US ambiguity toward Japan’s expansionist militarism in the 1930s clearly led to the Pearl Harbor attacks that started the war in Asia in 1941. Ambiguity in a world with leaders like Russian President Vladimir Putin and Chinese President Xi Jinping (習近平) will inevitably