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December 2010
So-Heng Chang is a visiting scholar at the Foreign Policy Research Institute and University of Pennsylvania, an associate research fellow at Cross-Strait Interflow Prospect Foundation, and a Ph.D. candidate at Cheng-Chi University in Taipei. The material in this E-Note was initially presented as part of a panel discussion, "Taiwan: Elections at Home, Economic Relations with the Mainland and U.S.-China-Taiwan Relations," held on December 8, 2010 and sponsored by the Foreign Policy Research Institute, the Center for East Asian Studies of University of Pennsylvania and Penn Taiwanese Society.
On November 27, 2010, Taiwan held mayoral elections in Taipei, Xinbei (formerly Taipei County), Taichung, Tainan and Kaohsiung. These elections attracted much attention because they were seen as a mid-term verdict on President Ma Ying-jeou's leadership and a possible prelude to the 2012 presidential election. Because the five cities include roughly 60 percent of Taiwan's voters, Taiwan's two main political parties, President Ma's Kuomintang (KMT) and the opposition Democratic Progressive Party (DPP), and possibly Mainland China as well, saw the elections as a significant measure of the popularity of President Ma's policies on cross-strait relations and other matters as well. In the end, these elections held some surprises, but they provide an uncertain guide to the political future, where much turns on issues in Taiwan's domestic politics and external relations that the mayoral elections did not-and in some respects could not-address.
The KMT won three of the five mayoralties, grabbing Taipei, Xinbei and Taichung city, while the DPP won in Kaohsiung and Tainan. The political topography did not change. The north-south divide remains, with northern Taiwan leaning toward the KMT, while the DPP received strong support from the south. But the DPP won the majority of votes cast and more than had been expected, and this has alarmed the KMT. The KMT garnered 44.54 percent of the votes, while the DPP took 49.87 percent. Overall, the DPP secured 400,000 more ballots than the KMT. Some local newspapers even said that the KMT's triumph was a "catastrophic victory."
In the previous round of mayoral and county magistrate elections (2005 and 2006) in these five areas, the KMT won 52.28 percent of the votes against the DPP's 46.03 percent. In the 2008 presidential election, President and KMT Chairman Ma won handily, with over 2.3 million ballots more than the DPP's candidate. Ma garnered 58.45 percent against the DPP's 41.55 percent. The DPP's comparatively and unexpectedly strong performance in the latest mayoral elections points to an undercurrent of change or, at least, a fluid electorate. The elections understandably have left the KMT feeling uneasy about President Ma's re-election prospects, and brought moves to thoroughly re-examine their policies, campaign strategy and overall performance.
Since Ma took office in 2008, relations between China and Taiwan have improved markedly. There is a more relaxed cross-strait atmosphere. Several rounds of talks and negotiations have been held, and the two sides signed many economic agreements or protocols, the most important being the Economic Cooperation Framework Agreement (ECFA). Tensions over the cross-strait situation are at one of their lowest levels ever. Much of this de-escalation is attributed to President Ma. The achievements of his cross-strait policies have helped revive Taiwan's economy, which has been an especially pressing concern since the global financial crisis hit in 2008. Under the Ma Administration, Taiwan's economic growth has increased over four percent and unemployment has dropped below five percent in 2010. The Ma Administration has achieved diplomatic progress as well. Several countries, including those in the EU zone and Canada, have recently granted Taiwan visa-exempt status. And Taiwan has secured, albeit on an ad hoc basis, participation as an observer at the World Health Assembly.
Given these apparent accomplishments, why did the KMT lose the support of so many voters in the November mayoral elections? On the key domestic issue, although the economy is recovering, the wealth disparity between metropolitan and rural areas-particularly between northern and southern Taiwan-has widened. The benefits of increased trade with China have long belonged primarily to large enterprises and entrepreneurs, not to small companies. As many in Taiwan see it, the economic revival only benefits rich people, not the common people. Real estate prices remain troublingly high, especially in northern metropolitan areas. Many people complain they cannot afford to buy an apartment. And the Ma Administration has also lost support for not doing more on judicial reform, and for not handling better the disaster response after Typhoon Marokot.
Weak candidates and regional political landscapes were also problems for the KMT. In Kaohsiung and Tainan, the KMT candidates were poor matches for the DPP's candidates. And those KMT candidates faced an unpromising political environment. At the beginning of the election race, few predicted that the KMT could defeat the DPP in southern Taiwan. In the end, the DPP won by comfortable margins in Kaohsiung and Tainan.
On cross-strait policy, some voters, especially in southern Taiwan, have worried that Ma's economic policy is to move too close to Mainland China and that Taiwan's economy thereby might be absorbed into China's. They fear that Ma's ultimate intention may be unification with China, and that he may undermine Taiwan's sovereignty in negotiations with a more powerful China. Facing these challenges, the KMT has reason to heed the apparent warning from the decline in its vote share in the mayoral elections and to try to improve its appeal as it prepares for an arduous battle against the DPP in 2012 presidential election.
Whatever the sources of dissatisfaction with the ruling party, the KMT has reason to worry about the DPP revival. In addition to its comfortable win in Tainan and landslide victory in Kaohsiung, the DPP lost by only 32,000 votes in Taichung. In the 2008 presidential election, the KMT carried Taichung by about 300,000 votes. In Xinbei, the DPP lost by about 110,000 votes this time, but in the 2008 presidential election, the KMT won the area by 490,000 votes.
These shifts in vote share imply that the DPP has been successful in moving beyond the shadow of corruption from former President Chen Shui-bian. While the DPP remains stronger in the south, its ability to draw voters is moving north. The party is showing strength and viability, and is regaining confidence. If this continues, the KMT will face a tough battle in the 2012 presidential elections.
Still, the implications of the mayoral elections for 2012 remain unclear. In the five mayoral elections, the candidates focused on concrete, largely local issues, including strengthening public policy, improving the economy, addressing social problems, improving urban public security and so on. They were not focusing on the sensitive and controversial issues of national scope or foreign policy implications, such as ethnicity, independence, political aspects of cross-strait relations and so on. Candidates sometimes bypassed partisan debates for campaign activities that included cultural performances such as music shows, dance shows, art displays, and campaign events that sought to demonstrate concern about taking care of the elderly and promoting childhood education and well-being. Such electoral behaviors are, in important ways, positive developments that can help promote the maturation and normalization of Taiwan's democracy. But they may not fully predict the course of a hotly contested presidential election.
Moreover, the mayoral elections were marred-and their implications for 2012 muddied-by an election-eve shooting. Sean Lien, the son of former Vice President and honorary chairman of the KMT Chan Lien, was shot at a campaign rally in Taipei County the night before Election Day. The 2010 shooting shows that election security is still a challenge for Taiwan. And while the motives for this shooting are still under investigation, the event was too reminiscent of the shooting of President Chen and Vice President Annette Lu on the eve of the 2004 presidential voting, which many credit with helping Chen to win in an extremely close race for reelection. Any "copycat" act or other recurrence of election violence could again alter likely election outcomes at the last moment in the legislative balloting to be held at the end of 2011 and the presidential voting in March 2012. For the sake of Taiwan's democracy, it is to be hoped that this will not happen and that all parties will avoid trying to take any advantage of any case of violence, which might again attract sympathy votes and affect the outcome of the election.
President Ma will no doubt seek reelection in 2012. He remains the favorite candidate but can expect a much tougher battle than in 2008. Ma's reelection bid faces challenges extending beyond those suggested by the big five mayoral elections.
Ma needs to address policy issues. On domestic policy, the KMT will continue to emphasize economic progress. It will stress efforts to create more jobs, increase employment, boost economic growth and salaries, and to narrow the wealth gap. The KMT will need to convince voters that its policies are correct, that Taiwan's economic performance is on the right track, and that Economic Cooperation Framework Agreement and economic trends are benefiting most of Taiwan's people.
Ma also must handle cross-strait policy well, which means maintaining continuity but with a more careful and cautious approach before the 2012 election. The pace of development in cross-strait relations during Ma's first two years in office has been adequate to reap political and policy gains. However, Ma's political prospects could suffer if ties were to develop much faster. We should not expect any surprising action from Ma's government in the next year and more. The KMT has learned through the disappointing election results to be more moderate in developing cross-strait relations. Ma will not be willing to have peace talks or political negotiations with Mainland China during this period. Any developments that would touch on particularly sensitive issues-such as sovereignty and international recognition- would draw severe criticism from opposition parties. Any perception that the KMT is ceding sovereignty to Beijing would be very dangerous for the party in future elections. Furthermore, Confidence Building Measures (CBMs) with the Mainland are still in too early a phase to move on to political talks. Still, the Ma regime also faces risk if it fails to continue to move forward on cross-strait relations. In CBMs, "C" stands for confidence, but it could just as well stand for "conference" because they have been talks with no results. The KMT-led government will need to continue to improve cross-strait relations, at least in economic areas, if it is to enhance the people's confidence in President Ma's leadership on what is, for Ma, a key issue.
Regarding relations with the United States and their implications for the KMT's political prospects at home, the Ma administration will strive to acquire F-16 C/D fighters. The military balance of power across the Taiwan Strait is ever more clearly in China's favor. Taiwan's air force is in desperate need of new fighter jets. If Ma could win approval to purchase the F16 C/D jets from the United States, it would enhance his support from the people and gain more confidence in reelection as well as negotiation with China. Ma will also seek to participate in the 2011 Asia Pacific Economic Cooperation Meeting (APEC), to be hosted by the United States. Standing on this stage of world leaders would be a diplomatic coup that likely would help Ma in the 2012 race.
The Ma administration also will try to advance talks with the United States on free trade agreement issues, such as the Trade and Investment Framework Agreement (TIFA). If the two sides sign the TIFA, it will be a tremendous diplomatic success for the KMT in securing a clear sign of support for Taiwan from its most important security guarantor. It also would be important economically, forging stronger ties with one of Taiwan's most important trade partners.
Party politics poses challenges as well. Ma may have to choose a new running mate. Incumbent Vice President Vincent Siew may retire due to health concerns. Premier Wu Den-yih is generally regarded as the chief contender for the KMT's nomination for vice president. Wu is a native Taiwanese, former general secretary of the KMT, Kaohsiung city mayor and legislator, having full administrative, congressional, electoral and southern experience, as well as a good relationship with President Ma. But right now Siew's attitude is ambiguous, and the scenario of the KMT is not clear.
On inter-party cooperation, the KMT will likely take measures to shore up relations with its allies, the People First Party and New Party. It also will seek to integrate local factional political groups, especially in central and southern Taiwan, and possibly cooperate with other independent groups.
Ma and the KMT also will have to be prepared to grapple with a likely reinvigorated DPP. Ma and the KMT cannot count on a weak and divided opposition party. The DPP chairwoman Tsai Ing-wen lost the Xinbei mayor's contest by a substantial margin, but she continues as party chairperson, rejecting a long tradition of DPP leaders stepping down after election losses. Tsai took over the helm of the DPP in 2008, when the party had slumped to new lows after its landslide loss in the 2008 presidential race and amid the prosecution for corruption of its former leader Chen Shui-bian. After 2008, Tsai guided the party to victories and recovery. She has been emerging as the party's likely presidential candidate. Su Tseng-chang, a stalwart from the DPP's older generation and the losing vice presidential candidate in 2008, is another contender for the party's presidential nomination. But his lopsided loss to Taipei Mayor Hau Lung-bin in the November 2010 mayoral context likely has reduced his chances. According to recent polls, Tsai leads Su. The DPP most likely will run a Tsai-Su, or perhaps a Su-Tsai ticket in the 2012 presidential election. They would be a formidable pair that Ma and the KMT could not count on beating.
Challenges to Tsai's leadership within the DPP have had little impact. Some of the DPP old guard has criticized Tsai and pressed her to step down as chairperson. Former Vice President Annette Lu has expressed a strong intention to seek the presidential nomination, opposing Tsai. Most DPP lawmakers and the DPP caucus of Legislative Yuan have said they would continue to support Tsai as chairwoman.
Stridently pro-independence elements are also unlikely to push the party to electorally unsalable positions. In the recent municipal elections, the "one side, one country" alliance, a political group dedicated to promoting Taiwan's independence, won 36 city council seats while running only 41 candidates. That was a victory for the group but is unlikely to affect DPP strategy for 2012. The DPP recognizes that sovereignty is the most explosive issue between Taiwan and China and that it can be so in Taiwan's politics. The United States does not support Taiwanese independence. China always claims that it will use all means against Taiwan should the island declare independence. Taiwan's renewed push for independence would immediately lead to an unnecessary crisis. Tsai and the new generation of the DPP, are thus highly unlikely to take that route. Although the independence issue still matters to some of the DPP base, it will not be a part of 2012 platform of the party.
Tsai has been working to develop stronger policy positions. She has noted that she will establish a think tank research center in the party to strengthen analytical and policy capacity to address cross-strait developments. If the DPP wants to regain power, framing a long-term cross-strait policy and articulating a policy to create a peaceful and stable framework for interacting with China are necessary to enhance the party's prospects for returning to government.
Tsai's moves reflect her desire to break away from the DPP's traditional anti-China posture. She also has indicated that she would push for dialogue with China to encourage mutual understanding to avoid tensions, and that the party would explore the possibility of holding talks with Chinese academics, think tanks, and scholars. The DPP, thus, is getting ready to actively deal with China. The DPP surely will emphasize Taiwan's international stature, but moderate the party's prior China policy, avoiding ideological politics and especially the DPP's former emphasis on Taiwan independence. These changes may help earn more support from independent, neutral, and young voters, heading into the presidential election in 2012.
The 2010 mayoral elections have implications not just for Taiwan's two principal parties; they also matter for China. Beijing has reason to be basically satisfied with the outcome of the recent elections although the apparently rapid recovery of the DPP may be a source of worry. Given this election's results, Beijing might doubt Ma's ability to navigate Taiwan's complicated political situation and secure reelection. Beijing believes that it is in China's interest for the KMT to keep power. That outcome would, in Beijing's view, support continued dialogue, coordination, and negotiation between Taipei and Beijing and make it easier to maintain stable cross-strait relations. Beijing hopes that the DPP will not come to power again soon; Beijing sees the DPP as too hard to deal with and too pro-independence. Therefore, China is likely to announce some policies favorable to Taiwan before 2012, including a variety of political or economic perks, to try to win-or at least warm-the hearts of Taiwanese voters for close cross-strait relations, and thereby to enhance the KMT's chances of staying in power.
China will continue to seek to promote economic integration with Taiwan, expand and deepen cross-strait exchanges, and steadily promote economic development on both sides of the strait. In the more sensitive political field, Beijing will not rush the KMT on launching political dialogue in the near future, especially before the 2012 election. Beijing recognizes that most people in Taiwan would prefer to perpetuate current conditions rather than move toward independence or unification with China. If political talks were to be held today, suspicions would arise and protests might erupt in Taiwan, including such measures as boycotting congressional agenda and organizing street demonstrations. This would jeopardize re-election chances for Ma and imperil China's preferred outcome.
Chinese leader Hu Jintao is pragmatic and more patient on Taiwan issues than his predecessor. He does not have any fixed public timeline for unification. Hu could agree and live with Ma's positions on the "1992 consensus," means "one China, respective interpretations consensus," which was reached by the two sides in 1992. Hu did not address the reunification issue during his term in office. His main aim is building links with Taiwan, while avoiding Taiwan's push for independence. Before 2012, the situation of the Taiwan Strait thus is likely to remain peaceful and stable. Beijing perceives that the DPP's power is growing again, and likely understands that it should not ignore the party's rising political clout. It thus would be in China's interest to develop a practical, reasonable, and rational communication channel with the DPP in case Ma does not win.
The arms sales issue is always the most serious issue among Taiwan, China and the United States. China always warns the United States that arms sales to Taiwan could derail and destroy China-U.S. relations. Taiwan desires to buy F-16 C/D jet fighters, but the Obama administration has not reached a decision on Taiwan's request. Hu plans to visit the United States in January 2011, and U.S. Secretary of Defense Robert Gates will visit China the same month. With these impending visits, the United States is well-advised not to approve arms sales to Taiwan and thereby irritate China at a sensitive time. Prospects for the sale of F-16 C/D aircraft to Taiwan may have been dimmed further amid the recent crisis on the Korean peninsula which has underscored the complexity, fragility and importance of the U.S.-China relationship. Meanwhile, on the Chinese side, removing or reducing the number of missiles aimed at Taiwan remains uncertain as well. Beijing well may use this issue for leverage, pressing the United States to limit arms sales to Taiwan in exchange for a reduction in the arsenal targeting Taiwan.
The APEC meeting in Hawaii in 2011 provides another opportunity and challenge for Taiwan-U.S.-China relations. The core issues are whether China will agree to allow President Ma to participate as Taiwan's representative and whether a meeting could be held on the sidelines of APEC between Ma and Hu. If such a meeting were to occur, it would be a potentially historic step toward China's acceptance that Taiwan's President has the stature not just of a leader of a local government, but rather as an equal head of government. Whether Hu will be willing or able to do this, especially in the face of pressure from more hawkish elements at home, remains an open question. If President Ma, with U.S. backing, could take part in the APEC event and hold such a meeting, it would be a major diplomatic achievement for him, as well as for Taiwan. For Ma and the KMT, it would also be the sort of accomplishment in external affairs that could help speed their recovery from the unsettling implications of the KMT's comparatively weak showing in the November 2010 mayoral elections.
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