TAIWAN S NEW MA ADMINISTRATION: A LOOK AHEAD

Transcription

1 CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE TAIWAN S NEW MA ADMINISTRATION: A LOOK AHEAD WELCOME: DOUGLAS H. PAAL, DIRECTOR, CHINA PROGRAM, CARNEGIE ENDOWMENT SPEAKERS: BONNIE GLASER, SENIOR ASSOCIATE, CSIS MICHAEL D. SWAINE, SENIOR ASSOCIATE, CHINA PROGRAM, CARNEGIE ENDOWMENT MONDAY, MAY 12, 2008 Transcript by Federal News Service Washington, D.C.

2 DOUGLAS H. PAAL: While the last few people are coming in from the lousy weather outside and settling in, I just wanted to welcome all of you. Thank you for coming out on such a bad day and on a Monday, especially. It s always difficult. For me, it s a bit of introduction. This is my I m into my second month as a Carnegie Endowment senior associate, the term of art used here and it s my first opportunity to preside over an event here. And I m very pleased that we ve been able to attract all of you to come and listen to what we have to say about the incoming administration of President-elect Ma Ying-jeou, who s a well-known figure, probably more well known to this audience than to other audiences that could be assembled in Washington. But nonetheless, we ll talk a bit about that. And we ve invited from CSIS, Bonnie Glaser, to come and speak with us. Bonnie has her biography in front of you, so I won t go into the detail; just point out that she s a frequent visitor to the mainland and to Taiwan. She s been working on a project that involves cross-strait and U.S. relations. They have had her back frequently and just in the last couple of weeks and she s also written extensively on the subject and today she ll give us some insights into the issues and the questions that will be on the table of the new cabinet under President Ma and his premier, Liu Chao-shiuanstarting May 20. Our second speaker for about 10 minutes or so is Michael Swaine, who s my colleague here at Carnegie, much published and also a frequent visitor to both the mainland and to Taiwan and I ve asked him to focus on a narrow part of his broad specialty on national security and military affairs to look at some of the military-related issues that are going to be again on the table of the new cabinet on May 20. And then finally, I will wrap up with a few words about Ma, the man and the politician. And then we ll go forward to engage in a conversation with all of you. So if I may begin now, I d like to invite Bonnie to start us off. Thank you. BONNIE GLASER: Thank you. Good afternoon and I hope you re all drying off as I am as I walked over here and my umbrella refused to stay in one piece. (Laughter.) As Doug said, I m actually engaged in a project that relates to cross-strait confidence-building measures which I ve been working on for several years and took a delegation of experts to Taipei and to Beijing to discuss that issue. And in Taipei, of course, we met with Presidentelect Ma and some of his advisors. I thought I d start my remarks today by talking about the priorities that Ma Ying-jeou has and they are essentially three. The first is national reconciliation and that is that Ma needs to build a domestic political consensus that goes beyond the 58 percent of voters who supported him and reaches into the remaining 42 percent of voters who did not. Second on his agenda is strengthening ties with the United States. I think Ma wants to achieve this through visible ways, not only through behind-the-scenes close dialogue and security cooperation. As one senior KMT advisor put it, the PRC could get arrogant if we are not accomplishing enough with the United States. So what could be done to visibly strengthen Taiwan-U.S. relations? First, an early transit and seeking to be received well in a visit to the United States. Second, in the economic realm and I won t go into this in much detail, but I think a trade and investment

3 framework agreement, a TIFA, remains within reach. A free trade agreement would probably be extremely difficult given the expiration of fast-track authority and the anti-freetrade atmosphere currently in the United States and that will likely intensify if a democratic is elected president in November. The third area is military purchases. And once Ma Ying-jeou is inaugurated, discussions will, of course, ensue about Taiwan s defense strategy and the issue of new air platforms, specifically F-16 C/Ds, will be discussed. And I believe that securing new fighters is an important part of Ma s plan to bolster U.S.-Taiwan relations so that he can then negotiate with the mainland from a position of strength. The third priority is improving cross-strait relations and I will focus on this in more detail in a minute. As for the three priorities, I d like to emphasize that sequencing is very important. Steps, I think, should be taken really in all areas simultaneously and each step should reinforce the others. If not carefully sequenced, then one more of these objectives could be unattainable. Now, after Ma s victory, many pundits claimed that Ma had won a mandate. But there has been some disagreement about what Ma now has a mandate to do. In my view, his mandate includes transforming Taiwan s relations with the mainland, at least beginning with the economic component. But I think we should ask, what is the new relationship that the majority of the people in Taiwan want to have with the mainland? First, the majority of people, I think, have rejected the policy of promoting hostility toward the mainland that was pursued under Chen Shui-bian. I think that has been deemed not in the interests of Taiwan. And in this regard, they have, I think, decisively rejected confrontational identity politics that Chen Shui-bian pursued. The majority favors the establishment of direct links to facilitate trade and economic cooperation. Importantly, I think they remain committed to preserving Taiwan s sovereign independent status. And the vast majority, still around 80 percent, wishes to maintain the status quo. Supporters of reunification remain quite small in number. And finally, I think the majority expects to be treated equally by the mainland and with dignity, and this includes greater participation in the international community, what is often referred to as international space. The defeat of both of the referendums in the Taiwan election, I think, should not be misinterpreted as indicating that the people of Taiwan don t think that this is a very important objective. Ma has placed a great deal of emphasis on securing greater international space for Taiwan. In fact, just, I think, on Friday, he gave a speech to the ROC Association of International Relations. And in that speech, he stated that Taiwan s diplomacy should be associated with its cross-strait policy and he indicated a willingness to negotiate with China over Taiwan s international space. I think this is an approach that will be welcomed by Beijing. Ma s committed to seek a peace accord with the mainland. But he has said that he will eschew discussing security issues while more than 1,000 ballistic missiles are aimed at

4 Taiwan. It remains unclear exactly what his going-in position will be, whether he will ask for those missiles to be reduced, completely removed, pulled back, or destroyed. To sustain public support for his policy of engaging the mainland, Ma will have to show progress on these issues, perhaps not in the first six months, but certainly during his first term. And this was emphasized to us when we were in Taipei. Failure to make headway will affect the KMT s fortunes in future elections and Ma s own chances of being reelected in a second term. It is therefore critical for Beijing to cooperate with Ma s policies, to prove the correctness of his approach and to provide early dividends to the Taiwanese people. So how is the mainland viewing Ma Ying-jeou and what policies is Beijing likely to pursue? And here I would characterize China s response so far as positive, but cautious. I d like to share a brief anecdote. When I was in the mainland last month, I had a discussion with a well-connected Chinese scholar who provided his assessment of Ma Yingjeou s situation, his political state in Taiwan. And he said Ma Ying-jeou s position is not that firm, he faces criticism within his own party, he continues to be challenged by the opposition, it remains to be seen whether he can really achieve this domestic political consensus to continue to have a policy of sustaining engagement with the mainland. And then he said, China, therefore, should have low expectations for Ma Ying-jeou. And my response to that was, well, perhaps your analysis is correct, but I would hope that the policy prescriptions would be different. I think that China needs to be bold in engaging Ma Ying-jeou, to help him to shore up his position at home to ensure that he can sustain support for a policy of transforming Taipei s policy toward the mainland. So why is China so cautious? Let me present a couple reasons. First of all, China is very much, I think, suspicious of Ma Ying-jeou and his intentions. The mainland views Ma as anti-communist and pro-american. His annual participation in events recalling the 1989 Tiananmen massacre, his sharp comments about Beijing s handling of the protests in Tibet last month, caused many in China to question how far Ma really will go in improving relations with the mainland. And I think that the reaction of the mainland to Ma s appointment of Lai Shin-yuan is instructive in this regard. Rather than view this as an attempt by Ma to win support from a portion of the Pan-Green, many Chinese contended that Ma was seeking to put a brake on improvement in cross-strait relations. Some even accused him of just simply being another Lee Teng-hui and likely to adopt a similar two-states approach to relations with the mainland. Thirdly, the Chinese are worried that Ma Ying-jeou will emphasize the differences and not adhere to what is often referred to as shelving differences. When Hsiew Wan-chang met with Hu Jintao at the Boao Forum, indeed he delivered a 16-character statement that represented Ma s policy and one of the sets of four characters of the 16 emphasized setting aside differences. But the mainland remains concerned that Ma will emphasize the differences rather than the commonalities. And this is particularly true on the issue of one China--Will Ma emphasize respective interpretations of One China and the fact that one

5 China is, in his view, the Republic of China, if there is one China. If he constantly repeats this position, there is concern on the mainland that that could undermine prospects for improving relations. And then on the issue of international space, the mainland also has several concerns. One is that in either four or eight years, the DPP could return to power. So if mechanisms are created that provide Taiwan with the opportunity to participate in the international community, in key international organizations, there is concern that these could later be used as a platform that could be used to promote independence. And secondly, even while Ma Ying-jeou and the Kuomintang are in power, there are concerns that greater international space could be used by Taiwan to strengthen its de facto independence, rather than promote reunification. Now, of course, Beijing has said reunification is not its immediate objective and I certainly agree there has been a shift to deterring independence, rather than promoting near-term reunification, but this remains a long-term goal and it remains a criterion by which future policy toward Taiwan is going to be considered and weighed in the future. And the final concern that China has is uncertainty about U.S. intentions. There are doubts that the United States really wants to see closer mainland-taiwan relations. And there are expectations that the U.S. will move to upgrade ties with Taiwan and sell arms in an effort to undermine the process. And until China figures this out, I think it is reluctant to move forward. Many people in Taiwan, the mainland, and the U.S. have termed the situation that will be ushered in Ma Ying-Jeou s election as an historic and a strategic opportunity that should not be missed. Both wise and bold leadership is needed, especially, in my view, in Beijing. Hu Jintao gave his own 16-character expression when he met with Lien Chan a few weeks ago, which I think is a good start. He said build mutual trust, shelve disputes, seek common ground while setting aside differences, bring about a win-win situation, earnestly work for the well-being of compatriots on both sides of the strait and for peace in the Taiwan Strait and finally create a new phase in the peaceful development of cross-strait relations. But to change the course of Chinese policy toward Taiwan, Hu Jintao will have to issue clear new guidelines, otherwise the bureaucrats in the system will not significantly alter their tried and true tactics. The foreign ministry will keep on squeezing Taiwan s international space. The PLA will continue to deploy missiles and conduct threatening exercises opposite Taiwan and measures to promote cross-strait economic integration will potentially be viewed as a means to make Taiwan vulnerable to mainland pressure. As I told Chinese experts in Beijing several weeks ago, it is time for a new paradigm. The Chinese often counsel others to have strategic vision. Transforming the cross-strait relationship, in my view, is primarily the task of the two sides of the strait. And I think Ma Ying-jeou has already laid out a realistic agenda. Let s hope that Beijing responds positively and with alacrity. Thank you.

6 MR. PAAL: Thank you, Bonnie, for that very insightful recitation of the challenges. I just did a brief interview before coming down here on the question of the management of the aftermath of this very strong earthquake that s taken place in Sichuan province. And you think what it must be like to sit at Hu Jintao s desk and you ve got the Americans asking for more on Burma, you ve got the Taiwan issue, you ve got an earthquake you have to mobilize the national resources to help rescue the people and rebuild the area, and a few other things to do as well. It s a pretty daunting challenge. I d like now to turn to Michael Swaine and ask him to give us a few remarks on the implications of a new administration in Taiwan on the military side. MICHAEL D. SWAINE: Thank you very much, Doug. It s a pleasure to be here. What I d like to do is say something first about at least how I look at the question of the military balance across the Taiwan Strait and how it relates to other factors that impinge on stability in that area and then talk about how what I ve said is affected by the victory of Ma Ying-jeou. From my perspective, the military balance, the military issues regarding Taiwan, can really only be understood and evaluated in the context of the larger political environment that exists regarding cross-strait relations and regarding the U.S.-China-Taiwan relationship, and of course given the extent of the U.S. defense commitment to Taiwan. So a simple order of battle assessment of capabilities between Taiwan and the mainland is by no means sufficient to understand what the meaning of the military balance in the Taiwan Strait actually is. You have to always place it in a political context. Now why is this? It s because military force in the Taiwan Strait serves on all sides as a deterrent against political moves that could conceivably threaten the regime stability in both China and Taiwan. The cross-strait political environment, in other words, largely determines the importance and the utility of military factors, and not the other way around. Now, military forces and U.S. support across the Taiwan Strait arguably also influence perceptions on both sides of the willingness of each to engage in cross-strait dialogue toward greater stability and modus vivendi or whatever. There are differences, though, in perception about how military forces influence this kind of willingness to engage in dialogue. The Chinese side strongly believes that a stronger Taiwan, for example, is less inclined to deal with them on discussions leading to some kind of greater stability and eventually, of course, from their perspective, unification. On the other side, the U.S. government and many people in Taiwan believe that a stronger Taiwan could make it more inclined to talk. So there s a fundamental difference there about the utility of military force as a stability-inducing factor across the strait. Now, in reality, military deployments, in my view, by China and by Taiwan and especially U.S. arms sales to Taiwan have often been used as political tools in domestic maneuvers, particularly on Taiwan by the armed services and commanders of the armed services, between the Pan-Blue and the Pan-Green political opposition and political power groups, and among commercial interests in both the United States and Taiwan.

7 These factors don t absolutely control military decisions, but they do play a significant role. In addition, there s no strong public demand in Taiwan for more defense spending or improved capabilities of a significant level. There s a view in many quarters that the costs are too high, the U.S. supports the acquisition of significant weapons systems out of profit-induced motives and because of commercial interests or there s no need for Taiwan to acquire such weapons because the U.S. will, in any event, come to the aid of Taiwan, or because there s no need to acquire such weapons because the Chinese will never attack Taiwan. So there is a very mixed perception about this in Taiwan. Now, during most of the Chen Shui-bian era and until very recently defense spending and major arms acquisitions, in fact, have been, to some degree, either reduced or delayed due to the standoff between the president and the Legislative Yuan, with some exceptions of course. You ve had improvements in some notable areas, but you ve also had some significant foot-dragging. In the meanwhile, the Chinese military has very steadily increased its capabilities in a variety of areas that enhance their deterrent capacity in dealing with the cross-strait issue. Now, the danger of this, of course, has been, in the view of a lot of American policy analysts and defense planners, that this kind of asymmetry or imbalance in the pace of improvement could lower the Chinese threshold for the use of coercion if the political dynamic were to deteriorate. And this dynamic increases, of course, the level of reliance on the American capability to make up for any deficiencies that might exist on the Taiwan side, and thus puts greater pressure on the United States, particularly given the fact that a lot of the military weaknesses that Taiwan may have will most affect the first week to 10 days of any kind of conflict that might occur across the strait. The U.S. has to be able to compensate for any possible weaknesses in that particular area. Now, how is all this affected by the Ma victory that we ve seen? Well, from a policy perspective, or at least on paper, the Ma government has recognized the kind of asymmetry that is increasingly emerging across the strait and has pledged to do certain things to increase defense capacity in Taiwan. It wants to increase defense spending to 3 percent of GDP. It wants to emphasize and strengthen very much the defensive aspects of Taiwan s capabilities, what s called the hard-roc using a pun, R-O-C and emphasize defensive over offensive capabilities. It wants to transition to an all-volunteer professional military within four to six years, using a significant portion of that increase in defense spending. It has stressed the acquisition of more naval capabilities, but it has not called for the acquisition of submarines, which had been approved in April of 2001 by the Untied States government and have never been acquired by Taiwan. It s endorsed, at least on paper, the purchase of the F-16 CD versions that Bonnie referred to, 66 of these, in its February 08 national security strategy paper. But, of course, the U.S. government has not formally accepted the request by Taiwan for these aircraft, and thus has certainly not approved the sale of those 66 F-16s. The LY in the meantime, has also agreed to provide funding for some of the other weapons systems that were approved in April of 01. In addition, the Ma government has adopted on the policy side a three-no s policy of No Unification, No Independence, and No Use of Force by China.

8 Now, despite all of these statements, my sense is that the Ma government, in looking at the cross-strait balance and in looking at military acquisitions of one sort or another, might indeed reconsider some aspects of its position and submit a new list of arms requests to the U.S. based upon assessments that it has made in recent months. That isn t to say they re going to entirely jettison their past positions as I just outlined, but there could really there could be some reassessments here and there. The key question, as we go forward though, in looking at this picture, is to what extent will Ma and the Kuomintang-dominated LY will cooperate in defense spending and acquisition levels given what I ve referred to as the rather mixed attitude of the public about increasing defense spending and acquiring certain types of weapons systems, particularly expensive ones from the United States? Now, the most urgent matter, as Bonnie has alluded, in the near term is the F-16 CD purchases. This has not gone forward under the Chen Shui-bian government and under the Bush government because, in large part, as I see it, the Bush administration and President Bush, in particular, has refused to grant permission for these aircraft to be supplied to Taiwan. And that has occurred by and large because the president was very dissatisfied with the position of the Taiwan government and Chen Shui-bian, in particular, regarding issues such as the referendum. And so the LY allocated but then froze money for the purchase of these F-16s pending U.S. receipt and approval of a formal Taiwan request for the F-16s, which the U.S. has yet to actually receive from the Taiwan government, that is to say, is unwilling to receive from the Taiwan government. Bonnie just suggested that the Ma government wants to move forward and acquire the F-16 CDs presumably as soon as possible after Ma takes office. Of course, Ma has taken a position that he would like to have had the Chen Shuibian government acquire the F-16s and thereby take the heat off him, presumably. Yet I don t know if indeed there is a complete consensus within the Ma government to move ahead and acquire the F-16s. I don t know. Bonnie may well have better information on that than I do. But it does seem to me that there isn t a strong degree of momentum on the U.S. side to move forward to receive the request and grant the approval to provide the F-16s. I don t see any good time for a U.S. approval of the F-16s in the near to medium term. The strong symbolism of this sale is almost guaranteed to provoke a strong reaction from the Chinese side. It could have a deleterious effect on Ma s efforts to undertake contacts with the mainland. The U.S., in my view, will probably not approve and sell F-16s before the Beijing Olympics certainly and perhaps not before the end of the Bush administration. I think, in fact, it s on balance more likely than not that the Bush administration will not sell F-16s to the Taiwan government before Bush leaves office. And the new administration, I think, will have to consider this sale of the F-16s or reconsider the sale of the F-16s. I think an Obama government would by no means automatically make a decision to provide these aircraft to Taiwan. The McCain government might be more inclined to do so, but we haven t seen a whole lot of information in that regard to indicate one way or the other. My own view is that I certainly hope that Ma does move forward with a 3 percent GDP spending increase on defense. I do hope he focuses on defensive capabilities. They

9 are very much needed to continue to improve and strengthen along lines that have been developed over the last several years of hardening of military, political, and commercial assets on Taiwan, increasing levels of ordinance and logistics capabilities for weapons systems already in place, which are in some cases still inadequate, increased training and recruitment levels through increased defense spending, move forward towards a more professional force that, of course, is a longer term objective and develop a more coherent overall defense strategy for Taiwan, which has yet to really happen. I don t think this requires the addition of new high-profile weapons systems in the near to medium term. At the very least, it seems to me I would think the F-16s could be held in abeyance in the early months of the new Ma government and used perhaps for some degree of leverage. The Ma government, in my opinion, also needs to conduct a dialogue with Washington on the possible timing and the political impact of acquisitions such as the F-16 and not continue with this rather poorly prepared request and then the failure of any response from the U.S. government for, it seems, political reasons on both sides. I m hoping that that kind of dynamic can be overcome after the Ma government takes office. The focus in the U.S.-Taiwan defense relationship, in my view, should indeed be on assisting Taiwan and strengthening its defensive capabilities in a low-key manner, but a very systematic manner, with significant resources committed to the effort and a continued discussion about how best to improve coordination between the U.S. and Taiwan to avoid escalation or preemptive actions or unexpected actions on the part of either side. None of this, however, in my view, requires a significant upgrade in the level and intensity of Taiwan intensity perhaps, but not the level of Taiwan and U.S. military-tomilitary ties. At this rather delicate time for improving cross-strait relations, I don t think the U.S. government needs to undertake new high-profile defense initiatives with Taiwan that could significantly reduce the chances for an increased dialogue across the strait without appreciably improving Taiwan s deterrent capacity in the near term. Thank you. MR. PAAL: Thank you, Michael. I think you and Bonnie have given us really a sharp focus on some of the very tough issues that face our government, the Taiwan authorities, and the mainland as they look to the months ahead. Taiwan s successful conclusion of the most recent election, which all three of us were there to observe, was a very peaceful, widely accepted process and result. It marked the second time since Taiwan introduced democracy in the 1990s that the parties were able to change hands without a military coup or disruptions of a serious nature in the streets. We had had some in 2004, but that didn t result in the party changing hands. This time I think, as Larry Diamond of Stanford University said, this marks the maturation of Taiwanese electoral democracy. Now many people who would argue that when you have change of government and it s based sort of democratically, not much happens. There s a wonderful skeptical story in the body of work by Chuang Tze the Chinese philosopher, about something called (Chaosan, mu-si. A zookeeper has some monkeys and he offers them three bananas in the morning and they all scream, no, no, no. So he says, okay, I ll give you four in the morning

10 and three in the evening. No real change. And they were all happy monkeys. Chuang Tze s skepticism, I think, doesn t apply in the case of this election. I think that this election has meaning. The results will produce a difference. I thought, even though most of the faces I recognize here are pretty knowledgeable about Taiwan, it s useful to take a look at a little bit of the background of President-elect Ma as an individual. Because Taiwan does suffer from distance and isolation, it s often not very well understood by the non-experts here. First, if Ma is known to people in the United States who are not experts, it s likely to be for being a handsome politician with a strong following among female voters. He s a product of New York University and Harvard University s law school. He s been a rising political star from the very earliest days, and is often viewed as one of the faces of the future of Taiwan. Now in his mid-50s, he s a remarkably young-looking guy. He s viewed as a conciliatory contrast with his predecessor, outgoing president Chen Shui-bian, whose relations with Washington and Beijing have suffered tensions in recent years, for the reasons mentioned beforehand. I d like to risk boring you all by talking a little bit more in detail. In Taiwan politics, one significant factor is that Ma was born in Hong Kong. Even though his parents were mainland in origin, they had been living in Taiwan and were in Hong Kong temporarily when he was born. The label, the sobriquet mainlander has been a handicap to him in politics in Taiwan, where identity politics has been the dominant theme of the last eight years, as has been pointed out just now. Educated through college in Taiwan, Ma was singled out for stardom when he was returned to Taiwan from the U.S. and was appointed to be the English language secretary of the president of Taiwan at the time, Chiang Ching-kuo. Chiang Chin-kuo was the son of the famous Chiang Kai Shek, long-time dictator of the ROC. Chiang Chin-kuo was also a budding reformer. He knew he had to change the way things operated and Ma was a good face for him at the time. In the early 1990s Ma served as a young minister of justice in Taiwan in the cabinet of President Lee Teng-hui. And in that job he took on corruption as his main target. He took it on so well that pretty soon enough people in the party felt they were targets of this anti-corruption advocacy that they wanted him pushed out, and he did not survive a change of cabinet. But it had burnished his image with the Taiwan voters as someone who was a corruption fighter. He served for a short time in the Legislative Yuan, and so gained some experience in legislative politics, which I think we all recognize are different from administration politics, gubernatorial or presidential politics. The give and take of the legislative agenda is different from what happens in the principal s job. But he himself primarily remained an administration official, not one of Taiwan s legislators, always clamoring for short-term attention. From 1998 to 2006 he was twice elected mayor of Taipei city. He had a good victory the first time. The second time was an even bigger victory. What he was proud of, as he

11 mentioned many times, was that he managed to capture a number of the areas that had traditionally voted for the so-called green or pro-independence or Taiwanese native forces in the Taipei city area, an area normally dominated by mainlanders but which does have pockets of Taiwanese voters, native Taiwanese voters. In 2006, after stepping down as mayor, Ma captured the chairmanship of the Kuomintang party. He did this through the unique means of having an election by party members. The Kuomintang Party has traditionally been a seniority-based, top-down kind of party and Ma s opening up selection of the new leadership by elections was an important reform. And when he won that election convincingly against Wang Jin-pyng, the speaker of the Legislative Yuan, who himself represents the Taiwanese faction or elements within the Kuomintang. He proceeded to start to undertake reforms of the KMT which had been started but kind of lacklusterly implemented under the chairmanship of Lian Chan. He got rid of the famous party headquarters, which loomed over the presidential office in downtown Taipei. He significantly cut the bloated KMT personnel payroll and retired a lot of the senior KMT officials. In 2007, unfortunately for Ma and his image as a clean party figure, he got embroiled in a corruption controversy and then was prosecuted three times at three levels of the Taiwan judicial system for personal corruption, having been accused of co-mingling official administration funds with his personal income. The case was adjudicated and he was acquitted all three times, and that had hung over him on the eve of the presidential election as a possible disqualification. We could go into the details if those of you who don t know the details of how this happened wish; it s too detailed to go into, too boring I think, in a way. But it was a significant challenge that Ma had to overcome, that his clean image was being tarnished at a critical moment before a presidential election. He managed to come through it, and of course in January this year he led the KMT in its legislative election, and the KMT won a plurality among the votes, and because of the peculiarities of the Taiwan election system, won more than 75 percent of the seats in the legislative Yuan, which means basically what we would call a veto-proof or an ironclad majority in the Legislative Yuan. Preparing for his March election as president, it give him not only the mandate he won in March of again, but also a strong legislative body to back up the implementation of his new administration s policies. Now what should we make of Ma the man and Ma the politicians? I think it s important to observe that he is a legally punctilious individual. His legal training has been with him throughout his political career. He has tremendous respect for the constitution, and this shows up not just in public remarks but in private ones as well. And he believes in following rigorously the established law, even if the established law sometimes has peculiarities. He scored against in the election campaign he was able to score against Chen Shuibian s proclivity to dismiss or downgrade the ROC constitution and to try to implement

12 through administrative fiat or work-arounds a variety of changes, most of which involve name changes at the last minute in the campaign this year. I consider Ma a man of principle, and this can be demonstrated in almost any press conference you see him engaged in. He tends to respond to events by falling back on established relevant principles rather than to seek short-term political advantage. And this has helped him withstand the constant onslaughts of large numbers of journalists looking to find some little twist, some little headline for that day s story or newspaper lead. Ma constantly falls back on process and principle, and this has stood him well. Some see this, however, as a shortcoming, that he s not like other politicians in Taiwan. He doesn t make decisions and force the political advantage, put a knife in when the opportunity has presented itself. On the other hand, it seems to have given him considerable staying power over the years in Taiwan public life. I would call Ma a man of procedure and process. He doesn t arrogate every issue to his personal consideration. He tries to establish processes by which even if he has his own point of view to start with, he allows the airing of other points of view and a process by which those views are validated and gain, if not consensus support, something close to consensus support, before he has to make a decision himself. I give you a case in point. The Control Yuan in Taiwan has been non-functioning for about two years, a little more than two years. There s been a dispute between the ruling KMT Party in the legislature, and the administration of Chen Shui-bian over the composition of the appointees who had occupied this job. The Control Yuan, for those who don t know, it s something like a GAO and a special counsel s office writ large. Significant figures look into problem areas or allegations of abuse of power. These jobs have been unfilled now, as I said, for about three years. It s a breach of the constitutional role of this particular part of the administration. Going back to the point of process, Ma has indicated that he wants to see this Control Yuan fully staffed with senior officials, but he wants to have a process established whereby a distinguished panel of Taiwan citizens will nominate candidates who meet broad standards of distinction and probity and personal experience, to have their names submitted, not necessarily on a partisan but on a quality basis for consideration by the legislative Yuan a little later. We ll see how this works out when they finally get in office, but that s what they ve indicated they wanted to do. This is also the same process he wants to bring to the appointment of grand justices. There s been a dispute over which candidates should be approved for grand justices. It s as if the United States Supreme Court were down to about three judges while we re fighting over nominations in the Senate. This is one that has been hanging fire and Ma has proposed there be a distinguished panel of people who come in and work out a list of names that will be broadly acceptable, to get the Judicial Yuan properly functioning as well. This will also apply to something called the Examination Yuan, which is sort of like our civil service bureaucracy.

13 Now another example of this emphasis on process and consensus-building involves cross-strait relations. Many in Taiwan were nervous; one mention was made earlier about the appointment of Lai Shin-yuan as the new head of the Mainland Affairs Commission. She is a former legislator for the Taiwan Solidarity Union, which is closely associated with President Lee Teng-hui, and she, being appointed from that body, that experience, left the impression, as I think Bonnie mentioned, that the mainland is nervous that there s some different agenda from what they expected. But from Ma s perspective, what he said in public is that this appointment was intended to reassure the five million voters in Taiwan who did not support him in the election, that they will have a voice in the process, that the KMT will not use their supermajority in the legislature, in the strong cabinet positions to ride herd over the sentiment of the Taiwanese who did not support Ma s election. Another characteristic of Ma is that he has great respect for capability and capacity of the individuals and their experience. If you look at his new cabinet, it s a remarkable team. He s got, in my view, a nice mixture of young and old. He s got some older, very experienced and highly respected individuals. I point particularly to the deputy premier Paul Chiu Cheng-hsiung, who I ve seen in many encounters in my own time in Taiwan, is greatly respected by the professionals in the financial industry. He s got a lot of personal integrity. He s going to have that responsibility as vice premier. But he s got a younger man as the premier who s going to be in the difficult job of trying to supervise the very large number of cabinet positions in the Taiwan government. If you look at the cabinet s composition, two-thirds of the members are Ph.D.s from respected Taiwan or Western universities. We haven t had two-thirds of Ph.D.s in our cabinets yet. In fact, under Reagan we came close, a lot of people would be surprised to hear. Twenty-seven percent of the appointees are female. He had promised 25 percent, he slightly over-delivered. There are six university presidents among the cabinet. The appointment for the man who s given the important responsibility of handling cross-strait relations directly, the Strait s Exchange Foundation chair has gone to Chiang Ping-kun, who s a very experienced official in a variety of capacities in Taiwan, who s had a lot of personal experience dealing with cross-strait issues over the years, including negotiating the Kuomintang and Communist Party interactions that led to their meetings in 2005 and up to the present, to build party-to-party relations. All of this I ve just described is in marked contrast with the period since 2000, when President Chen Shui-bian came to office. He was elected it was a surprise to him, he would tell you that, and his party was really not ready for power. Circumstances put them in power. In an early compromise with the KMT they agreed that the cabinet would be a mixed cabinet of DPP and KMT people, but that agreement fell apart very quickly over the disagreements on the fourth nuclear power plant, and thereafter both the KMT and PRC turned colder and colder toward Chen Shui-bian s government. His own government had fewer and fewer capable people to put into key jobs, and they started to stumble in domestic policy, which meant they had to rely more on the cross-strait tensions and domestic divisions to try to make up for the deficiencies in performance as cabinet officers. So this offers, I think, an important change in terms of the ability of the government to deliver, to

14 satisfy the people s expectations, especially on the economic front, and hopefully on the reduction of cross-strait tensions. So in summary, I think Ma has brighter prospects for competent management of domestic stability and delivering economic improvements to sustain his popular support and get him through to the 2012 elections. His capacity to reduce tensions and keep them low with the PRC seems to be innately present. He s got a lot of the right people in the right places. Delivering on this will have to depend on whether they can overcome the suspicions and doubts that have been outlined with respect to the mainland. There may be stumbles along the way and mistakes made. People who have been out of power for eight years and new people coming in often have forgotten part of the catechism, forgotten part of what they need to know, and they ll make some mistakes. But I think the prospects are reasonably good to continue a strong showing in the upcoming city, county, and legislative elections, and that would mean presumably continued impetus for Ma s own re-election. Moreover, strengthening those prospects is that the opposition DPP is now in a very deep funk. It s the party that has always united for elections but has exposed its factional differences in defeat. The two defeats in the legislative Yuan and the presidential election have been very substantial defeats for them. It set off now a contest to succeed as chairman of the DPP, and the contrast could hardly be starker among the two chair candidates. Moreover, the party s got to struggle to decide what its future is going to be. Clearly an identity politics will not be enough. Is it going to be a party of the new left? Is it going to be a party of the left out? Is it going to be a party of the center? How will it get to a 50 percent majority when it s typically topped out at 40, 41 percent in elections? These are all important challenges that give Ma more domestic space if he can t get the international space to deal with these challenges. Taiwan has legacies of isolation. It s got troubled education reform that needs to be grappled with. It s got, in my view, incomplete institutionalization of its democracy. Its media and legislature and other instruments of democracy need to be strengthened, and these will be additional challenges for the Ma administration going forward. That concludes my remarks. I d like first to ask Bonnie and Michael if there is anything that either of them said that they d like to respond to or amplify, please do that. And then we ll open the floor to your questions and observations. MR. SWAINE: I m okay. MS. GLASER: I have just one thing I d like to comment on, and that is Michael Swaine s position, where I think you said, you don t see any good time for the F-16 sales to be made. My personal view is that a consensus will be reached that Taiwan needs new air platforms, and the question is just what the United States agrees to sell and when they are sold. And I think postponing that decision to a new U.S. president creates the danger of getting the U.S.-China relationship under a new president off on very much the wrong foot that could continue for a prolonged period of time. So I would argue that the best time for such a decision is after the Olympics and before President Bush leaves office.

15 MR. PAAL: All right, we re ready to open the floor to questions of many of you. Please, when you get recognized, raise your hand and identify yourself. Q: Bonnie, just a quick question. If, say, F-16 sales go forward, how would China respond with Ma s request, demand that China withdraw the missiles? Because clearly the Chinese military will be very upset and will use increasing Taiwanese capabilities as an excuse for not doing anything about lowering China s own capabilities. I see really a stalemate coming on that front. MS. GLASER: Well, from a military perspective, of course, there isn t much of a match between, you know, air capability and missiles. If we were really evaluating this from a military perspective, then we should look at the PAC-3. No weapons sale will be welcome by the Chinese side. I mean, I think that the mainland will strongly respond to virtually whatever arms sales are made by the United States because they will see this as seeking to impose obstacles in the process of improving relations. I don t know what they will attribute as Ma s intentions. I agree with I think it was I don t remember which one it was, Doug or Michael, who said that the Chinese don t accept the fact that this is to strengthen Taiwan s confidence and ensure that Taiwan will engage in negotiations with the Mainland. I think it remains to be seen whether the Chinese recognize that for a period of time the mainland is going to preserve its deterrent against Taiwan independence, and Taiwan is going to want to continue to maintain and develop a degree of defensive capabilities so that it can hold out against an attack until the U.S. were to come to its aid, and I believe, so it can negotiate with the mainland. I believe that this is something that should be understood by the mainland and should not result in pressure internally to not take what I would see as really a politically symbolic step to freeze the missiles that are deployed opposite Taiwan. I think that that a freeze would at least begin to address Ma s insistence that psychologically it s very difficult for him to engage in negotiation with the mainland on security issues as long as they re facing these large number of missiles. At least the PRC could cap them at a certain point, and even to go a bit further, perhaps taking a brigade of older, less accurate missiles and dismantling them. But I certainly take your point. The Chinese could react very strongly, and it could end up disrupting a process that we all very much want to see of a real stabilization in crossstrait relations. Q: Thank you. Nai-chin Mofang (ph), Phoenix Satellite Television. I have two questions for Doug and Bonnie. First, what are your expectations for Ma Ying-jeou s inauguration speech in terms of cross-strait relations? And do you expect it will be well received by the U.S. government? And the second one is about the transit. Ma Ying-jeou s staff told media in Taiwan that the U.S. may grant Ma transits through New York or even Washington, D.C., on his way to visit Central American countries in August. So how likely

16 do you see the prospect that Ma would be permitted to transit through Washington, D.C., or meet U.S. officials here? Thank you. MS. GLASER: Okay, I will take the cross-strait portion and leave the U.S.-Taiwan portion to Doug. I think that it is unlikely that Ma Ying-jeou will say anything that is really surprising. I think in the inauguration speech on cross-strait issues there are things that the mainland is expecting him to say, certainly reference to the 1992 consensus, and I think Ma will not do that without following it with yi zhong ge biao (in Chinese): Each side has its own respective interpretations, and we are the Republic of China. This is a formulation he has stated repeatedly during the campaign, and I think that is exactly what the mainland expects him to say. He may reiterate what Michael referred to: no reunification, no independence, no use of force, which incidentally I have heard him say refers to both sides, not just China. Thirdly, I think it s interesting to add that Ma has highlighted among the 16 characters that Hu Jintao said to Lien Chan, I think it s the first four, building mutual trust. And he has said that in his inaugural speech this is something that he will respond to, so we can look forward to see exactly what he says in that regard. MR. PAAL: I think on the question of transit visits, the administration is poised to respond to improvements in cross-strait relations that are the result of Taiwan s efforts, and even if they re not big successes, at least if Taiwan is trying and the PRC doesn t respond, to improve the conditions of transits through the United States. I don t anticipate transits through Washington. I think that s a bridge too far, given the 1994 decision by President Clinton to deny access to Washington itself to officials at the top of the government of Taiwan. But I think a good visit through New York, with good visits with legislators and the local population, is entirely possible, in a reversal of the way that such visits became impossible with Chen Shui-bian when he was perceived to be resisting American suggestions that he change his position on the referendum or on other matters. So I think this becomes a reward mechanism for those who share America s views of what our interests are in maintaining peace and stability in the Taiwan Strait area. Q: Mike Fonte. I m the Washington liaison for the DPP. In the course of the campaign Mr. Ma seemed to have switched on a very important principle, it seems to me, which is the question of who decides the future of Taiwan. He previously had said, of course, it would be people on both sides of the straits. But in the course of the campaign he said very clearly it was up to the people, the people of Taiwan only to decide that factor. So I guess the question is, how do you view that, Doug, in terms of the principle question? Also Bonnie, what response, if any, has China given to that particular set of principles? MR. PAAL: That s a good question, Mike. You know, in the course of every campaign you start off with ideas and you think you ve covered the water, and then everybody s come back to you and said, well, does it mean this, this and this? I think it s a