Archive for June, 2017

Pension reform

June 30, 2017

As I start this post, the legislature has just passed the third reading of the civil servants pension bill. It now moves onto the bill for teachers, and the legislature has yet to take up the bill for military pensions. Nonetheless, now that the rules for civil servants have been rewritten, the others should follow along those basic lines. There is a lot of cleanup work still left for the legislature, but the basic fights have already been waged.

We all have a basic understanding that the current system needed some adjustment. There was too much money going out and too little coming in, and the system was going to go bankrupt in fairly short order. Even President Ma recognized the need for reform. (He quickly aborted his nascent reform in the face of a backlash from public servants, who constitute one of the KMT’s most important voting blocs.) The retirement benefits were simply too generous. Civil servants could often retire in their early fifties and collect monthly stipends nearly equal to their full salaries. Since benefits were based on their last month’s salary (ie: the highest they had collected in their entire career), that meant that the state was often paying people more in their retirement than it had while they were working AND their retirements might be as long as their working careers had been. This system may have been defensible when the GDP was growing by double digits every year, the birth rate was high, and civil servants earned a relatively low base salary. However, those conditions haven’t described Taiwan for two or three decades. Things had to change.

Pension reform was one of the three or four most important goals for Tsai Ing-wen’s first term; arguably it is the single most important domestic reform item on her agenda. Tsai has taken a lot of criticism over the past year. People who didn’t vote for her (predictably) think she is doing a terrible job, and they point to things like China’s more antagonistic stance toward Taiwan and the resulting drop in group tourism from China. They are also furious about the effort to nationalize the KMT’s ill-gotten party assets, which they see as a witch hunt (the “green terror”). Many people who did vote for Tsai are also somewhat disillusioned. Her support for marriage equality has been less than strident, her cabinet is full of old men (many of whom have ties to previous discredited administrations), some of the government’s economic policies have been presented and implemented clumsily (labor standards law, infrastructure package), the economy isn’t growing at 8% a year, transitional justice hasn’t been achieved yet, and the world isn’t perfect yet. Against this background, achieving pension reform should be a shining star on Tsai’s report card.

In fact, I’d argue that pension reform has almost perfectly embodied Tsai Ing-wen’s vision of consensus democracy. There were a lot of people who wanted the DPP to present their ideal bill and ram it through the legislature. After all, what is a majority for? Instead, Tsai took the process slowly and deliberately. Tsai’s cabinet included Minister Without Portfolio Lee Wan-yi, whose sole job was to oversee pension reform. The government held a national forum on pension reform, and Lee’s committee held several other hearings. These hearings were somewhat contentious and the opposition did not always participate in good faith. Still, most of the important political arguments were presented, and the committee was able to filter through them. One of Tsai’s stated goals at the outset was not to treat public servants as an enemy. As she put it, they were to be seen as partners in the reform rather than objects to be reformed. The Executive Yuan committee ultimately came out with a fairly moderate bill. At about the same time, the Examination Yuan came out with its own bill. The Examination Yuan members have fixed terms, and over half of them are still left over from the Ma era. As might be expected, the Examination Yuan bill was even more modest than the Executive Yuan bill. Transition periods were stretched out over more years and various formulas were adjusted to be somewhat more favorable to public servants. However, the two bills were surprisingly similar. By the time the Examination Yuan was ready to propose its bill it had become clear that some sort of reform was unavoidable, so the Examination Yuan proposed a substantive reform bill. During the first half of 2017, anti-reform forces were trying to arouse public opinion against Tsai. Various veterans, civil servants, and teachers groups held rallies, but these were generally not well attended. Surveys showed that public opinion was solidly in favor of reform, and this did not soften as a result of anti-reform activism. If anything, public opinion solidified in favor of a more aggressive reform. By the time the bills got to the legislature, the anti-reform movement was largely played out. In the legislature, the pro-reform forces took their turn trying to pass a more aggressive bill. Both the DPP and NPP caucuses demanded changes to various formulae and transition periods. They succeeded in some of these demands, and the law that eventually passed was somewhat more aggressive than the Executive Yuan bill. Nonetheless, Tsai stepped in to ensure that the most radical demands would not be adopted.

By the end of the process, the KMT found itself in a quandary. Public servants constitute a core constituency, and the KMT wanted to speak for them. However, public opinion was clearly against them, and the DPP caucus showed no signs of wavering. As the saying goes, there are two ways to resist in the legislature: civil and military (文、武). The “military” method involves physically occupying the speaker’s podium and disrupting the normal parliamentary procedures. The “civil” method involves using dilatory tactics such as introducing hundreds of amendments to stretch out proceedings as long as possible. In general, if you are sure of your position and your support in society, you go for the military option. If you are on shaky ground, the civil option is the best you can do. For months, I expected we were heading for a “military” showdown. However, the KMT will eventually crumbled. The KMT could not agree on an alternative bill, so the caucus was reduced to supporting various bills proposed by individual members. Instead of occupying the podium or offering hundreds of amendments, the KMT opted for a very weak battle plan. They would have several people speak on every clause, thus taking several days to pass the bills. The DPP was relatively happy to oblige, so the legislature has been engaged in marathon sessions all week. (A minor but telling point: When the DPP made a motion to extend yesterday’s meeting until midnight, it passed unanimously. If the KMT were really trying to resist, it would have opposed lengthening the meeting.) I’ve been sick this week, so I watched a fair amount of these debates on the LY channel. The KMT offered two main arguments against the reform. On the one hand, they suggested that the reform unfairly cut civil servants’ pensions too much. On the other hand, since the pension fund is forecast to go bankrupt in about 2049 (as opposed to in about 5-10 years under the current system), this reform doesn’t really solve the financial problem so there is no point in doing it. Note that those two positions are contradictory. If you want a reform that will be permanently sustainable, you are going to have to cut pensions even more.

In the end, Taiwan got a pension reform that both sides were a bit unhappy with, which is probably a pretty good indicator that it is a moderate compromise. Public discussion was allowed to percolate until some arguments were discredited and others emerged as superior. Opposition was marginalized, with the street protesters painting themselves into an ever smaller box. Instead of forming the vanguard of a public movement against reform, the anti-reformers demonstrated themselves to be merely selfishly interested in defending a system that unfairly privileged them. As they got smaller, their appeals got cruder and further discredited their moral position. (Example: a sign referring to President Tsai’s genitalia is not a smart way to make the case that civil servants are being unfairly discriminated against.)

If you had asked President Tsai after her inauguration when she expected to pass pension reform, I suspect she would have replied that it would take about a year. In fact, it has taken just over a year. One year to study the problem, hold public discussions, allow protesters to make their case, for supporters to reaffirm their insistence on this reform, and to pass a new law. Don’t expect the media to come out with glowing editorials praising President Tsai’s leadership. Democracy is messy, and we have been watching a messy and aggravating process unfold for nearly a year. Moreover, we ended up with something of a compromise, and no one loves a compromise. Nonetheless, I suspect this is exactly how President Tsai thinks democracy should work.

KMT party chair election, revisited

June 22, 2017

Wu Den-yi was elected KMT chair about a month ago. At the time, one of the popular theories about his win was that it represented a victory of the Taiwan-oriented local factions over the orthodox Chinese nationalist wing. (Or, if you prefer, the Taiwanese wing defeated the Mainlander wing.) In this line of thought, Wu was inheriting the support previously won by Lee Teng-hui, Wang Jin-pyng, and Huang Min-hui. The unspoken implication was that native Taiwanese Wu would lead the KMT in a more localist direction, perhaps even becoming another Lee Teng-hui.

I’ve never been too enamored with this discourse, but I keep talking with smart people who believe it is more or less what happened. I see Wu as a firm believer in the orthodox KMT catechism. He may not be as extreme as Hung Hsiu-chu, but all of his statements and actions over the past four decades seem to me to indicate someone who is quite comfortable with the direction established by Lien Chan and Ma Ying-jeou. That is, he should be acceptable to both wings of the party. I think what happened in the chair election is that KMT members – who want to return to power – simply chose the strongest leader.

So what if I’m wrong? What if Wu was elected because the local factions mobilized to support him? What would that look like? One notable difference between the KMT chair elections in 2016 and 2017 was that there were about 50% more eligible voters and valid votes in the 2017 election. Many people have speculated that this was the result of local factions signing up new party members in support of Wu. If so, we should see a clear pattern. There should be far more new voters in central and southern Taiwan, where the local factions are strongest. Moreover, if Wu inherited and built on Huang Min-hui’s 2016 support, the increase should be greatest in places where more new people signed up for KMT membership.

Let’s look at the results of the 2016 and 2017 KMT party chair elections. The KMT tallied results for individual ballot boxes, but I can only find the full results aggregated up to the city and county level:


2016 KMT party chair election

    陳學聖 李新 黃敏惠 洪秀柱
    Chen Lee Huang Hung
合計 139558 6784 7604 46341 78829
台北市 12802 756 901 2990 8155
新北市 16694 723 916 4131 10924
基隆市 1931 121 136 504 1170
宜蘭縣 2845 139 138 1110 1458
桃園市 10745 1597 787 1698 6663
新竹縣 3378 153 191 1389 1645
新竹市 1944 74 112 485 1273
苗栗縣 5204 216 265 1796 2927
台中市 11238 548 751 3484 6455
彰化縣 8074 249 325 4217 3283
南投縣 4038 159 210 1905 1764
雲林縣 4354 148 188 2627 1391
嘉義縣 3842 47 92 2765 938
嘉義市 2678 27 62 1748 841
台南市 11102 316 561 3895 6330
高雄市 15996 632 1048 4956 9360
屏東縣 6358 197 370 2808 2983
花蓮縣 3420 189 243 795 2193
台東縣 2738 121 117 1315 1185
澎湖縣 1367 86 79 361 841
金門縣 1606 74 23 132 1377
連江縣 445 33 14 65 333
海外黨部 6759 179 75 1165 5340


And here is the 2017 election:

  valid Hung Han Pan Hau Chan Wu
  有效票 洪秀柱 韓國瑜 潘維剛 郝龍斌 詹啟賢 吳敦義
合計 272704 53065 16161 2437 44301 12332 144408
台北市 26887 5209 1689 248 6250 1338 12153
新北市 28684 6486 1658 240 4544 984 14772
基隆市 4537 461 217 33 1586 156 2084
宜蘭縣 6055 1244 302 63 749 180 3517
桃園市 18372 4001 998 132 4067 458 8716
新竹縣 7192 955 400 70 1413 346 4008
新竹市 5253 1576 355 78 696 212 2336
苗栗縣 9671 1641 693 100 1579 445 5213
台中市 22588 3934 1121 151 4035 707 12640
彰化縣 18808 2566 889 172 2770 1002 11409
南投縣 8566 879 234 31 577 179 6666
雲林縣 8765 1062 1476 95 1390 288 4454
嘉義縣 5038 898 198 19 524 391 3008
嘉義市 4810 1078 267 63 817 675 1910
台南市 20535 4588 1262 178 3124 1882 9501
高雄市 36623 6657 2239 389 4645 1695 20998
屏東縣 14798 2377 667 108 1418 476 9752
花蓮縣 9645 2681 690 156 1424 318 4376
台東縣 5100 810 255 42 1193 114 2686
澎湖縣 2711 768 124 32 546 302 939
金門縣 2382 747 148 20 448 91 928
連江縣 574 124 53 1 97 26 273
海外黨部 5110 2323 226 16 409 67 2069


You will notice right away that the total number of valid votes nearly doubled, increasing by 133,146. At the same time, the number of votes won by the (supposed) representative of local factions (Huang in 2016, Wu in 2017) increased by 98,067. It seems plausible that these two shifts are related.

98,068 divided by 133,146 is .74. A reasonable interpretation is the pre-existing party members voted basically as they had in 2016, but 74% of the new party members voted for Wu. However, once you start looking at individual cities and counties, things start to break down. We expect Wu’s mobilization efforts to be most effective in central and southern Taiwan, where the local factions supposedly went all out to mobilize new party members for Wu. Assuming Wu’s increase came entirely from new members, he only won 8% of the new members in Chiayi City and 20% in Chiayi County. Those results can perhaps be explained away because Huang was from Chiayi, so they might have already mobilized for her in 2016. However, if you accept the hometown effect for Chiayi, you also have to discount the high ratio in Nantou, since that is Wu’s home. Throughout the rest of the region, the ratio does not differ markedly from the national average; if anything it is slightly lower. At any rate, Wu’s supposed share of new voters is lower in all of central and southern Taiwan (excepting Nantou) than in New Taipei (.89) and Taoyuan (.92). These are not the supposed loci of local factions in Taiwan.

    Increase Increase  
    Wu-Huang Valid ratio
合計   98067 133146 0.74
台北市 Taipei 9163 14085 0.65
新北市 New Taipei 10641 11990 0.89
基隆市 Keelung 1580 2606 0.61
宜蘭縣 Yilan 2407 3210 0.75
桃園市 Taoyuan 7018 7627 0.92
新竹縣 Hsinchu Cnty 2619 3814 0.69
新竹市 Hsinchu City 1851 3309 0.56
苗栗縣 Miaoli 3417 4467 0.76
台中市 Taichung 9156 11350 0.81
彰化縣 Changhua 7192 10734 0.67
南投縣 Nantou 4761 4528 1.05
雲林縣 Yunlin 1827 4411 0.41
嘉義縣 Chiayi Cnty 243 1196 0.20
嘉義市 Chiayi City 162 2132 0.08
台南市 Tainan 5606 9433 0.59
高雄市 Kaohsiung 16042 20627 0.78
屏東縣 Pingtung 6944 8440 0.82
花蓮縣 Hualien 3581 6225 0.58
台東縣 Taitung 1371 2362 0.58
澎湖縣 Penghu 578 1344 0.43
金門縣 Kinmen 796 776 1.03
連江縣 Lienchiang 208 129 1.61
海外黨部 Overseas 904 -1649 -0.55


Maybe I’m thinking of this wrong. Maybe the point is that the growth in new KMT voters was much higher in central and southern Taiwan. The valid votes grew by 95% from 2016 to 2017. In 2016, Huang Min-hui won 33.2% of the votes, while Wu Den-yi won 53.0% in 2017, for an increase of 19.7%. If it was mobilization, these two numbers should move together. For example, valid votes increased by 129% while Wu beat Huang by 26.4%. Both of these numbers are larger than the national average, and Kaohisung is in the south. The problem is that we don’t see similar numbers throughout the rest of center and south. For example, in Changhau valid votes increased substantially, by 133%. However, Wu only bested Huang by 8.4%. All those extra voters didn’t seem to be going to Wu. In Tainan, valid votes only grew by 85% and Wu only outperformed Huang by 11.2%. In fact, some of Wu’s best areas were in the north. Wu outperformed Huang by 31.6% in Taoyuan and 26.8% in New Taipei, but neither one of these places had a particularly large increase in new voters. If you stare really hard and long at this table, you might convince yourself that you see a pattern. However, you are probably hallucinating. The correlation between the two columns is 0.05, just about as close to zero as you will ever see.

    % increase Vote share
    Valid votes Wu-Huang
合計   95 19.7
台北市 Taipei 110 21.8
新北市 New Taipei 72 26.8
基隆市 Keelung 135 19.8
宜蘭縣 Yilan 113 19.1
桃園市 Taoyuan 71 31.6
新竹縣 Hsinchu Cnty 113 14.6
新竹市 Hsinchu City 170 19.5
苗栗縣 Miaoli 86 19.4
台中市 Taichung 101 25.0
彰化縣 Changhua 133 8.4
南投縣 Nantou 112 30.6
雲林縣 Yunlin 101 -9.5
嘉義縣 Chiayi Cnty 31 -12.3
嘉義市 Chiayi City 80 -25.6
台南市 Tainan 85 11.2
高雄市 Kaohsiung 129 26.4
屏東縣 Pingtung 133 21.7
花蓮縣 Hualien 182 22.1
台東縣 Taitung 86 4.6
澎湖縣 Penghu 98 8.2
金門縣 Kinmen 48 30.7
連江縣 Lienchiang 29 33.0
海外黨部 Overseas -24 23.3

In the end, there just isn’t any compelling evidence for the idea that local factions elected Wu chair by mobilizing tons of new voters for him. Heck, there isn’t evidence that anyone mobilized new voters for Wu.

I think the increase in new KMT voters is related to party morale, not to the KMT party chair election. Morale was at a nadir in the aftermath of the 2016 wipeout, and lots of party members let their membership lapse. As morale has recovered (slightly), some of those party members have drifted back (and paid their dues). The turnout rate was also markedly higher this time. However, the number of eligible voters and valid votes are far below the levels of 2005, when the winner was widely expected to become the next president.

  Valid votes Eligible voters turnout
2005 518324 1033854 50.2
2016 139558 337351 41.6
2017 272704 476147 58.1

At any rate, I think the evidence suggests that Wu Den-yi was elected by a fairly broad base of support within the KMT rather than by any specific group such as local factions or Taiwan nationalists. Admittedly, there is a limit to what we can see with crude data like this, so maybe it is best to state my conclusion in the negative. I don’t see any clear evidence for the local faction mobilization thesis.




KMT party chair election

June 5, 2017

(I’ve been working on this post on and off for a couple of months now. Rather than revise it again, I’m just going to post it.)


The votes are in and Wu Den-yi has been elected the next KMT party chair, so I guess it is just about time for me to write up my election preview.


Here are the results:

吳敦義 Wu Den-yi 144408 52.2%
洪秀柱 Hung Hsiu-chu 53063 19.2%
郝龍斌 Hau Lung-pin 44301 16.0%
韓國瑜 Han Kuo-yu 16141 5.8%
詹啟賢 Chan Chi-hsien (Steve) 12332 4.5%
潘維剛 Pan Wei-kang 2437 0.9%

That is roughly twice as many votes (and KMT party members) than the last KMT party chair election. However, before you get too excited about a certain member mobilizing new members, remember that this is actually quite a bit fewer votes (and party members than the 2005 party chair election when over a million people were eligible to vote and over half a million votes were cast.

I was out of the country when the accusations of vote buying exploded, so I mostly missed that. However, I did watch both debates on Youtube, and I learned quite a bit from those forums about how each candidate was presenting him or herself. I’ll discuss the candidates in reverse order of their finish.


Pan Wei-kang

Pan was elected to the legislature in 1992 and has spent most of the last 25 years in the legislature, often also serving on the KMT central committee. For someone who has been at the center of national politics for so long, I was somewhat surprised by how little I knew about her. She is a second generation politician, and she comes out of the Huang Fu-hsing (military) system. However, I can’t remember hearing her speak very many times, and I never thought of her as particularly extreme. As such, I was a bit taken aback when she came out in the first debate breathing fire, demanding state reparations for the current wave of Green Terror against the KMT. She seemed determined to displace Hung Hsiu-chu as the candidate of the reactionary nostaligists. She toned down the rhetoric a bit in the second debate, but she managed to redefine herself in my eyes.

I don’t know what Pan was doing in the race. She never seemed to matter, and she never carved out a distinct niche for herself.


Steve Chan Chi-hsien

Chan was a complete mystery to me when this contest started. He had served as Economics Minister, but I don’t pay a whole lot of attention to governing. I’m into politics. I had heard his name bandied about as a possible running mate for the KMT presidential candidate, but that came to nothing. In retrospect, the high moment for Chan’s party chair campaign might have been when they announced the final results of the signature drives. All six candidates easily passed the minimum threshold, but Chan somewhat surprisingly finished second, edging out Hung and Hao. This turned out not to be predictive of the voting results though, as Chan actually got fewer votes than signatures.

In the second debate, Chan mentioned that his mother had been a Changhua county councilor and his brother had been Yuanlin town mayor. This was news to me, and I’m supposed to know these sorts of things. However, there was a reason I had never heard of them: they were elected back in the dark ages. Chan’s older brother was elected mayor in 1973, and we don’t have systematic records from town elections that far back. In fact, Chan comes from an elite local family with several prominent doctors. A bit of googling revealed that he is distantly related in some way to most Taichung and Changhua local faction families and even a few opposition politicians. However, the family’s electoral activities were decades ago and the old nework is almost certainly long gone today.

In the debates, Chan was the embodiment of a bureaucrat. He exuded as little charisma as possible and gave me the impression that he understood all of the details of problems without necessarily grasping the big picture. He spoke of visiting grassroots party members as if they were some abstract idea. People who routinely interact with ordinary voters don’t talk about those interactions as if they require some special effort. Someone told me that Steve Chan is close to Lien Chan. I don’t know if that is true, but they have very similar styles.


Han Kuo-yu

Five of the candidates sounded rather similar. Han sounded completely different. During both debates, Han didn’t talk about things like the 1992 Consensus, KMT party assets, or other partisan topics. Instead, he talked about the difficulties of everyday life for lower income and less educated people. Good jobs are scarce, drug use is common, things are too expensive, and life is generally hard. Notably, he did not blame all of these woes solely on President Tsai and the DPP. He was complaining about the effects of President Ma’s policies just as much. His discourse was limited to expressing the pain felt by the lower class. He did not bother to offer any solutions, not even Trump-esque claims that everything could be easily fixed if only someone really wanted to. This was a campaign aimed at the people who know the system is rigged against them and will continue to be rigged against them. It was also aimed at young men, especially the types who might drive a truck or join a gang. This may not have been the best strategy for a KMT party chair race, since I would wager that KMT members are less likely than the general population to be young, unemployed, financially struggling, or to feel that the system is rigged against them. Nevertheless, Han didn’t do terribly. I wonder how many candidates will pick up this campaign strategy for the city and county councilor elections next year.


Hau Lung-pin

Hau Lung-pin had exactly one remarkable idea. He stressed repeatedly that if he were elected chair, he would not personally run for president in 2020. Instead, he would ask Hon Hai boss Terry Gou to be the KMT candidate. Let’s think about this for a minute. There are a few reasons that this might be a good idea. 1) The KMT doesn’t exactly have a stable of qualified, charismatic candidates foaming to challenge President Tsai in 2020. Everyone is flawed, and no one is terribly popular. 2) The conventional approach failed dramatically in 2016, so the KMT needs to try something new. 3) Public opinion surveys show that Gou is more popular than any current KMT politician. 4) Donald Trump just showed that the USA was willing to vote for a business tycoon with no political experience, so maybe Taiwanese voters will follow suit. There is the small matter that Gou is currently busy running Hon Hai and may not have the time or desire to run for or serve as president. Nonetheless, Gou didn’t shoot the idea down, and there have been a few discreet trial balloons hinting that he might be willing. Rich people think they can do anything, that their immense wealth proves their superior wisdom and vision. Gou’s availability may not be the fundamental flaw in Hau’s plan.

There are two basic problems with Hau’s plan. The first is that Gou would probably bomb miserably as a presidential candidate. Gou has reasonably good poll numbers now, but the public hasn’t thought carefully about Gou as a potential president. He is a very successful business leader – with a far more impressive record than Donald Trump – and the public evaluates him mostly as a business leader. Once he becomes a politician, the media scrutiny will intensify and become much more critical. The halo surrounding Eric Chu in 2014 melted away in only a few months under the harsh spotlight of national politics in 2015. Gou’s current good (not great) polling numbers are almost irrelevant; six months after entering the political fray the public will think of him in a completely different light.

What about Gou’s fantastic business record? (Unlike Trump) Gou has built an enormous, world-class company. Hon Hai is one of the pillars of Taiwan’s economy, and it employs over half a million people around the world. Gou is good at business. Unfortunately, his business talent might not translate into a political appeal. For one thing, Taiwan does not have the traditional reverence for free enterprise that America does. Especially for Republicans, you often hear voters say that they prefer a person who understands business. As the chair of General Motors once said, the business of the US government is business. There is a significant slice of the electorate that sees pro-business policies as a moral appeal. Taiwanese voters are different. Among traditionalists, Confucianism views commerce with a skeptically. Politics and agriculture are honorable and create a better world; people in commerce are not much better than parasites and must be carefully regulated and restrained by the state. Contemporary mainstream Taiwanese society views business more favorably, especially since the Taiwan economic miracle was built on exports by small and medium sized business. Still, there is nothing like the American or British reverence for the invisible hand of the market. Not many people believe that an unregulated economy would produce a better society. Moreover, there is a growing worry about the increasing gap between rich and poor, and business tycoons may not be the ones preoccupied with addressing these concerns. Suffice it to say, Trump’s victory in the USA doesn’t necessarily mean that a business leader in Taiwan will do well in Taiwan. (Also, there is the strong possibility that by the time 2020 arrives, Trump’s disastrous presidency will be widely seen as evidence that business leaders do not make good politicians.)

Trump’s international dealings were never more than a side note among the perpetual storm of astounding news swirling around his campaign. For Terry Gou, it is unthinkable that his ties in China would not be at the center of his campaign. Hon Hai is the single biggest private employer in China. One way to interpret that is that Hon Hai has some leverage over the Chinese economy. Another interpretation is that China has enormous leverage over Hon Hai’s (and Terry Gou’s personal) fortunes. When China demands that Hon Hai does something, Hon Hai has little choice but to comply. It is not much of an exaggeration to say that the prime duty of Taiwan’s president is to defy China. There is a fundamental conflict of interest on the overriding question in Taiwanese politics. Gou’s loyalties would be continually questioned, and he would have no way to reassure the dubious public. Moreover, it isn’t like Gou is a strident democrat. The Gou Doctrine (“You can’t eat democracy.”) might find sympathy in a society that takes democracy for granted, like the USA. In Taiwan, democracy is what keeps Taiwan from being absorbed by a voracious China. (Note: Many people believe Taiwan’s economy keeps it independent. Hong Kongers wish that were true.)

I don’t care what the current polls say. I can’t see any way that Terry Gou wouldn’t be a disaster as a presidential candidate. Hau Lung-pin bet his political career on a terrible idea.

The second problem with Hau’s plan to ask Gou to be the presidential candidate is that it shows that Hau fundamentally misunderstands the nature of power in Taiwanese politics. Quite simply, power flows from the presidency. This is not unique to Taiwan. When there is an elected president with significant power, parties organize themselves to capture that big prize. Parties are presidentialized. Regardless of who holds the formal position of party leader, the de facto leader of the party is the incumbent president, the presidential candidate, or the person who could potentially become the presidential candidate. By promising not to run for the KMT’s presidential nomination in 2020, Hau basically ensured that he would never wield any power. His campaign appeal boiled down to, “Elect me as your leader so that I can refuse to be your leader.” Not only is this an illogical appeal, we’ve just seen how badly it works in practice. Eric Chu tried being a neutral referee in early 2015 when the entire party was practically begging him to run for president. That didn’t work out well for either Chu or the KMT.

To recap, Hau made a terrible choice in choosing to outsource the KMT presidential nomination, and he made another terrible choice by selecting Gou as his target. He deserved his humiliating third place finish with a pathetic 16% of the vote.

Where does Hau go from here? He probably won’t leave politics simply because the KMT has so little talent at the top levels. However, I think he is probably spent as a serious political force. It has been a very bad few years for him. As a two-term mayor, he was not on the ballot in 2014 and so was spared that humiliation. Nonetheless, his satisfaction ratings were routinely among the lowest of all the mayors and magistrates. It certainly isn’t good for your reputation when the other party wins your formerly unwinnable city after your eight years of lackluster performance in office. In early 2015, when the KMT was casting around desperately for a presidential candidate, Hau was one of those who boldly decided to sit on his hands and watch Hung Hsiu-chu’s rise. He bears a share of responsibility for the damage she inflicted on the party. Instead of running for president, Hau managed to secure the KMT nomination for Keelung City, one of the few safe KMT seats remaining. His calculation seemed to be that he did not want to sacrifice himself in the coming DPP tidal wave. Someone else could do that. He would position himself as leader of the KMT legislative caucus, which would be the de facto center of KMT power after the election. He would be able to pick up the pieces and lead the party back from defeat. There was one flaw in that plan: he lost the Keelung election. It wasn’t that there weren’t enough votes. The winning DPP candidate only got 41%. The problem was that MKT and PFP candidates combined to siphon off 24% of the votes, leaving him with only 36%. He was not able to unify the blue voters around his candidacy. The same thing happened in the KMT chair election. He did not lose because the general electorate rejected him. He lost because KMT party members – supposedly the group most enthusiastically supporting him – looked at him and collectively mumbled, “meh.”


Hung Hsiu-chu

I don’t have a lot to say about Hung that hasn’t been said many times over the past two years. She is far too extreme for the Taiwanese electorate. She was a disaster as a presidential candidate and party chair, and if it had elected her to another four years as party leader the KMT would have been sentencing itself to political oblivion. This wasn’t working, and even most of the KMT members who like what Hung stands for could see that the party needs to go in a different direction if it ever wants to return to power.


Wu Den-yi

It wasn’t a surprise that Wu won the race. He acted like the front-runner and the other candidates and the media treated him like the front-runner throughout the campaign. His first-round victory was perhaps a surprise, though. I had thought that he would get somewhere around 45% and need a second round to dispatch Hung or Hau. Instead, he won 52% and beat the second place candidate by 33%. In a race with five candidates getting significant numbers of votes, 52% is a fairly impressive result.

Wu’s strategy can be summed up quite simply: Let’s party like it’s 2011! In this view, there was nothing wrong with the party that won the 2008 election and was re-elected in 2012. Everything was going well until the party got derailed during Ma’s second term. The KMT flubbed things like the gas and electricity pricing and the capital gains tax. They failed miserably at political communication, and the population came to believe that nuclear power was dangerous and that the Services Trade Agreement would somehow risk Taiwan’s political sovereignty while transferring enormous wealth to the rich elite. The KMT failed most disastrously by shifting away from the 1992 Consensus under Hung Hsiu-chu. The task at hand is simply to return to that winning strategy. That means the entire package. For example, the KMT has to rebuild its ties with the local factions, assuring them that they are still a critical component of the KMT coalition. It also means returning to the greater ambiguity of the 2008 campaign, in which Ma repeatedly promised “no unification, no independence, no war.” In subsequent years, the KMT seemed to forget the “no unification” part of that formula. However, this does not mean that Wu Den-yi is a modern-day version of Lee Teng-hui, secretly scheming to lead the KMT and Taiwan toward independence. Wu is a deeply conservative person who believes in traditional values and deference to authority. He is well-schooled in the Church of Sun Yat-sen, and there is very little evidence he is not a sincere and committed believer. Lin Yang-kang and Wu Po-hsiung are much better models for Wu than Lee Teng-hui. Wu firmly supports returning to the 1992 Consensus, including the part about insisting that there is only One China. The Ma presidency was built on the premise that Taiwan’s economy should be further integrated into the larger Chinese economy for both economic and political purposes. Economically, Ma believed that integration would lead to faster economic growth for Taiwan. Politically, Ma saw an economic appeal as a way to win votes from a public skeptical of the glorious history of the Republic of China. The message was, “Don’t worry so much about China. We won’t take any steps toward unification. Instead, we will use them to make ourselves rich.” Of course, this strategy depended on negotiating a better economic relationship, and China would not negotiate with Taiwan unless Taiwan accepted the One China principle. The ambiguity that Ma was so proud of involved telling China, “Look, One China! Don’t worry about independence!” while simultaneously telling Taiwanese, “Look, each side with its own interpretation! Don’t worry about unification!” This delicate balancing act arguably produced two election victories before, in Wu’s interpretation, the KMT blundered by walking away from it. Wu promises to resume the friendly (but still arm’s length) relationship with China by reaffirming and adhering to the One China principle.

Is Wu correct to think he can simply put the old band back together? I have some doubts. For one thing, China in 2017 (and 2020) is not the China of 2005 or even 2012. Today’s China is much less deferential to the international order and much more aggressive about pursuing its international interests. In 2005 the world was still talking about the peaceful rise of China, and it was marginally plausible that Taiwan could have an exclusively economic relationship with China (win-win!). These days, China looks far more predatory and menacing. Further, in 2005 the two economies were more complementary, matching Taiwanese capital and technology with Chinese labor. Today, the two compete directly in many critical sectors. Finally, the Chinese economy is no longer growing at miraculous rates; it is now entering phase of relatively slower growth.

A second and more important point is that Taiwan of 2017 (and 2020) is no longer the Taiwan of 2005 and 2012. Identity has shifted. I assume that my readers are all familiar with the NCCU Election Study Center trends on national identity. Prior to 2008, more people held a Chinese identity (either exclusive or dual) than an exclusive Taiwanese identity. After 2008, that has no longer been the case. Nowadays, exclusive Taiwanese identity outpaces Chinese identity by a large margin (58.2% to 37.7% in the most recent data point). This is partly due to generational replacement, partly because some people have changed their minds, and partly because the language of political discourse has changed and Taiwanese are simply less likely to use the term “Chinese” to refer to themselves regardless of their political stance. Nonetheless, a KMT promising One China will face a far more skeptical electorate in 2020 than in 2008.

The third problem for this strategy is that the 1992 Consensus is no longer the same thing. In 2008, no one knew how the 1992 Consensus would work in practice. If you wanted to project optimistic or pessimistic visions on it, you could. Now we have eight years of experience. By the last few years, China was increasingly unhappy with Taiwan’s reluctance to take more concrete steps toward unification, and the Taiwanese electorate was increasingly unhappy with the continual degrading prostrations and erosion of sovereignty necessary to keep the official channels open. Ma’s implicit promise to voters, “Don’t worry about the political implications; this is just going to be pure economics,” was increasingly far-fetched. Instead of the wink-wink-nudge-nudge promise that the 1992 Consensus would allow Taiwan to enjoy both political sovereignty and close economic relations, it became increasingly apparent that the two were, in fact, inseparable. Accepting One China would have political consequences. In Taiwanese politics, whenever one issue (in this case economic strategy) clashes with the China cleavage, the China cleavage subsumes and absorbs the other one. I don’t think Wu can simply ignore eight years of history and pull them back apart.

My guess is that Wu will be fairly successful at holding the broader KMT coalition together. I don’t expect a spate of new splinter parties from the blue side, at least not in the next year and a half. However, I think Wu is overestimating the number of voters who are waiting to be pulled back into the KMT coalition. In 2012, 54% voted for Ma or Soong. In 2016, only 44% voted for Chu or Soong. Wu might consolidate that vote, but his plan to return to the good old days of 2011 doesn’t seem to me to hold much promise of expanding it much. Wu Den-yi is betting otherwise. I guess we’ll see.