Taiwan on (the) Edge

Taiwan on (the) Edge

Over the past 30 years there have been many moments when Taiwan-watchers worked themselves into a tizzy worrying about the potential for conflict in the Taiwan Strait. Whether it was Taiwan President Lee Teng-hui describing the relationship between Taipei and Beijing as a “special state-to-state relationship” in 1999, President George W. Bush rebuking Lee’s successor during a meeting with a PRC leader in 2003, or the PRC’s National People’s Congress passing the Anti-Secession Law in 2005, all three sides of the Washington-Beijing-Taipei triangle have done their part to keep things … interesting. Until now, though, I have been confident that worst-case thinking was unjustified, and the chances of open conflict were low.

Until now, but no longer.

At this moment, as Taiwan’s political parties battle over their presidential nominations, I am more worried about the future of the Taiwan Strait than I have ever been. Ominous trends are building on all three sides of the triangle, and conflict could be the result. It is by no means inevitable, or even the most likely future. But for the first time in decades, I can see a plausible path to disaster in the Taiwan Strait.

Beijing Tightens the Screws

In May of 2016, Tsai Ing-wen was inaugurated president in Taipei. Despite positioning herself as a moderate, including a consistent message that she was not seeking to change the status quo in the Strait (a message that included explicit references to the “Law on Relations between the People of the Taiwan Area and the Mainland Area”), Beijing was unconvinced. Her inauguration speech was deemed an “incomplete test paper,” and the only way she could pass the exam would be to utter Beijing’s mantra for cross-Strait relations, “’92 Consensus.” But Tsai has remained steadfastly asymptotic to the ’92 Consensus, getting as close as possible without actually uttering the words. In response, Beijing has shut her out.

In the two years since the inauguration, the Beijing side of the triangle has intensified the pressure on the Taiwan side. Beijing discontinued cross-Strait talks soon after Tsai took office, leaving only indirect communication between the two. It has increased its military activity in the Taiwan area, including numerous flights close to (and at least one over) the centerline of the Strait. It has flipped five countries that had diplomatic relations with Taiwan prior to Tsai’s election, thereby ending the “diplomatic truce” that had stabilized Taipei’s international position under its previous president, Ma Ying-jeou. And while PRC president Xi Jinping’s rhetoric in his 2019 New Year speech did not go as far as some have feared (he did not, for example, set a deadline for unification), Beijing’s rhetoric over the past two years has shown little flexibility or openness to the Tsai administration.

Where the PRC leadership has showed openness is toward Taiwanese politicians who are not part of Tsai’s administration or her Democratic Progressive Party (DPP). Beijing has actively cultivated relations with politicians from Taiwan’s other major party, the Kuomintang (KMT). The frequency of visits by KMT politicians to the mainland accelerated after the KMT’s big wins in the November 2018 local elections. The newly-elected mayor of Kaohsiung (and possible KMT presidential candidate), Han Kuo-yu, met with Beijing’s top Taiwan Affairs official in February along with officials from Macao and Hong Kong who are responsible for implementing Beijing’s one country, two systems policy in those areas. Beyond cultivating KMT politicians, Beijing has also been reaching out to ordinary Taiwanese people, offering inducements to Taiwanese to move to the mainland to live and work. Youth, in particular, are targeted for these opportunities.

Washington Sends Mixed Signals

Many observers start with the assumption that Taiwan is the wildcard in the triangular relationship. They fret about the rising percentage of survey respondents who choose “Taiwanese” instead of “Chinese” or “Both” to describe their identity, they implore the DPP to drop a long-ignored pro-independence plank from its party charter, they find every referendum proposal on a Taiwanese ballot an opportunity for mischief.

I disagree. I have long believed the US was the real wildcard in the relationship, not least because its interests are the most diffuse and indirect. The other parties know what they need (Beijing: no independence; Taipei: protection from coerced unification) and what they want (Beijing: unification; Taipei: maximum autonomy). The US position, in contrast, requires explaining.

Washington’s rhetoric has been consistent for decades, and the recent flurry of events commemorating the 40th anniversary of the Taiwan Relations Act last month testify to the desire by many in the policy community to stay the course. But the underlying logic of this policy – that the US interest is in peace and stability and a non-coercive resolution of the Taiwan Strait impasse – is simultaneously substantively unconvincing to some (Beijing believes the US is deliberately keeping Taiwan apart from the mainland for strategic reasons) and procedurally questionable to others (neither side really knows how the US would respond if the interests stated in its policy were challenged). The confusion deepens thanks to Washington’s long-standing pattern of sending mixed messages to both sides. That pattern began with Nixon and Kissinger, and has been institutionalized, some would argue, in the tactic of “strategic ambiguity,” which is aimed at deterring both Taipei and Beijing from upsetting the status quo in the Strait.

In short, mixed signals are nothing new, but the signals coming out of Washington under the current administration are even more perplexing than usual. On the one hand, the US in the Trump era has taken a number of strong actions that work in favor of Taiwan. The Taiwan Travel Act (2018) and the Asia Reassurance Initiative Act and Taiwan Assurance Act (2019) are examples of the US Congress showing its support for Taiwan, as is the (rather more problematic) vote to invite President Tsai to address a joint session of Congress (she has not yet sent her RSVP). From the White House we have the early indications – subsequently walked back – that Trump might rethink America’s one China policy (late 2016), as well as a strong statement of support for Taiwan from Vice President Mike Pence (October 2018). President Tsai was able to transit through US territory in March, and a US delegation to the island for the TRA anniversary in April included a Deputy Assistant Secretary of State. News of an impending arms sale to Taiwan might be added to list of supportive US actions, except that the sale – approved in October 2018 – has not been completed, reportedly because of fears that it could derail US-PRC economic negotiations.

And there’s the rub: It’s not clear what priority the Trump White House (as distinct from Congress and officials at lower levels) actually places on its friendship with Taiwan, relative to relations with the PRC and other considerations. If we look at Trump and his inner circle, we can identify a number of actions that have been quite damaging to Taiwan’s interest. Above all, the “day 1” decision to withdraw from the Transpacific Partnership (TPP) demolished Taiwan’s best chance for avoiding economic isolation and marginalization: Taiwan was collateral damage in an act of right-wing virtue signaling. Nor does Taiwan’s status as a bystander injured in the line of fire end there. It is subject to aluminum and steel tariffs, and Taiwan-based companies that manufacture or assemble in the mainland stand to suffer huge losses now that trade sanctions have been extended to a vast array of PRC-labeled imports. Meanwhile, Taiwan doesn’t matter in a foreign policy guided by Trumpian principles of unilateralism and transactionalism. Taiwan’s value to the US is its democracy, a virtue on which this administration places little importance.

Beyond the mixed messages, there is yet another ill wind rising in Washington when it comes to Taiwan. Over the past few years, the center of gravity among Americans has shifted toward a more skeptical view of China. The idea that the PRC’s direction was either positive or undetermined has less purchase than it did just a few years ago, with more and more observers concluding that Beijing is heading away from the kind of domestic and external policies that will facilitate its entry into the existing international order. This trend is understandable and could even benefit Taiwan. However, there is a danger that an “enemy of my enemy” mentality could take hold, in which support for Taiwan is promoted as a way to frustrate Beijing’s ambitions. Not only would such an approach validate Beijing’s suspicion that US policy has been aimed at separating Taiwan from the mainland all along, but it also turns Taiwan into a means to achieve US policy ends. There is nothing good for Taiwan in becoming a weapon for the US to use against the PRC.

Taiwan Eyes Uncharted Territory

Worrying about how Taipei might upset the fragile balance in the Taiwan Strait is a longstanding pastime in the policy community, but it has never been at the forefront of my concerns. Decades of polling and electoral data show that Taiwanese voters are moderate and cautious. Their refusal to embrace extreme candidates or novel policies can be frustrating to both sides – the rejection of marriage equality in a 2018 referendum deflated Taiwan’s progressives, while the popularity of the 2014 Sunflower Movement knocked back the KMT’s efforts to do economic deals with Beijing – but it has held Taiwan’s policies close to the midline between two extremes, independence and unification. But it is not clear whether that center can hold through the next round of elections, presidential and legislative elections scheduled for January 2020. My greatest concern is that there will not be a competent moderate on the ballot at all.

The president Taiwanese voters elected in 2016 was not moderate enough to suit Beijing, but by the standards of her party, she was (and is) a moderate. Her policies have aimed at shoring up Taiwan’s economy and promoting fiscal sustainability, not challenging Beijing or riling up the pro-independence camp. Nonetheless, Beijing has frozen her out. If its goal was to undermine Tsai’s popularity, PRC leaders are surely congratulating themselves on their success. In fact, most analysts credit Tsai’s low approval ratings to domestic factors, not cross-Strait relations, but whatever the reason, Tsai’s approval is low, and the DPP’s big defeat in November’s local elections mean the DPP – and especially Tsai – is coming into the 2020 elections in a weak position.

Compounding Tsai’s problems is a challenge from within her own party. Former premier Lai Ching-te has announced he is seeking the DPP presidential nomination. Lai’s announcement brought into the open a split that has been widening for years. The strongly pro-independence, or Deep Green, wing of the DPP has never been enthusiastic about Tsai Ing-wen, and they see her flagging poll numbers as an opportunity to get rid of her. Their selective reading of messages from Washington reinforces their sense that now is the time to push forward their agenda. Meanwhile, mainstream DPP leaders are desperate to avoid an open rift that will hand the election to the KMT; they have extended the nomination process in the hope of finding a compromise. If a compromise is not forthcoming, the nomination will be made by some combination of public opinion polling and inner-party voting. A poll-based primary is likely to favor Lai, who will benefit both from the buzz surrounding his candidacy and the likelihood that KMT-leaning voters will try to trick the DPP into nominating a candidate whose support is limited to one end of the political spectrum.

If Lai is nominated, the DPP will trade a candidate Beijing believes secretly supports independence for one whose support for independence is anything but secret. Last year, Lai described himself as a “Taiwan independence worker” in the legislative chamber. Taiwan watchers in the PRC have been warning US counterparts for some time that they are worried about a Lai presidency. Up to now, we have pooh-poohed those concerns, offering the electorate’s long record of moderation as proof that an unreconstructed independence advocate could not be elected. Those reassurances are increasingly hollow, though, as Lai continues his battle to represent the DPP in the 2020 race.

The DPP is divided, and it’s not alone. The KMT’s list of potential candidates includes Eric Chu, a Ma Ying-jeou-style traditionalist; Wang Jin-pyng, a Lee Teng-hui-style grassroots politician and former legislative speaker; and Chou Hsi-wei, an experienced local executive. Although they are very different, each of these candidates has a long record and is deeply embedded in the island’s political institutions and norms.

From the beginning of the KMT nominating contest, however, another possibility has hung over the field: Han Kuo-yu, the newly-installed mayor of Kaohsiung who is credited with leading the KMT’s sweeping victory in November. Han has so far declined to join the race, but he has made it clear that he would be happy for his party to draft him. Han sees the path to prosperity – for Kaohsiung and for Taiwan as a whole – running through the Taiwan Strait; his answer to Taiwan’s economic troubles is to deepen ties with the PRC. Taiwanese voters rejected this approach in the 2016 elections when they sent Tsai to the presidential office and a DPP majority to the legislature. Now, however, they seem willing to reconsider that choice.

Then, on April 17, a new wrinkle. Foxconn founder and chairman Terry Gou announced that he had received a message from the goddess Mazu that he should run in order to bring peace to the Taiwan Strait. Gou is a multi-billionaire whose business interests span the globe, but are heavily concentrated in mainland China. Foxconn is reportedly China’s largest private employer, and its biggest single export company. Guo is acquainted with Donald Trump, who has called Gou “one of the most successful businessmen in the world.” His success in business feeds a confidence in his own abilities captured in a comment he made to reporters when announcing his candidacy: “I am not a suitable candidate for a vice president, because I am used to making decisions.”

Politically, Gou’s success as a China-based manufacturer is a two-edged sword. For Taiwan’s more Sino-philic voters, his decades spent navigating the PRC business world are a plus. He has strong relationships with PRC leaders, and he’s used them to build his company into a world-leading EMS provider. For Sino-skeptics, however, the prospect of Terry Gou – a man who became a billionaire by building a business in the PRC – as president is deeply worrying.  

If the DPP nominates Lai and the KMT chooses either Han or Gou, there will not be an establishment moderate in the race. Voters would choose among an avowed independence activist, a relatively untested local politician who visited the PRC twice in his first five months in office, and a billionaire businessman with no political experience who made his fortune in the mainland. As the Taiwan-based writer J. Michael Cole put it in Taiwan Sentinel, “Moderation is being replaced by irrationality at both ends of the political spectrum, and the political center, which politicians like President Tsai occupy, risks being eroded. It is that center that has given Taiwan the resilience it needs to defend itself against the external threat posed by China.”

Yet another unpredictable element in the race is Taipei mayor Ko Wen-je. Ko has not yet declared his intention to run, but many pundits expect him to join the race. Ko, an independent, is especially popular with young voters; his appeal – like that of Han and Gou – rests on his status as a political outsider. But Ko’s positions on issues tend to be vague, and especially on cross-Strait relations, he can sound naïve. At an event in Washington earlier this year he compared Taiwan to Israel, and recommended Taipei take the approach of “clinging to the United States and Japan, while being friendly toward China.” It is not clear how Ko proposes to cultivate strong ties with the PRC, which he says is in “the same family” with Taiwan, and with Beijing’s two main antagonists, the US and Japan.

There’s no question that Beijing would prefer to see any of the KMT candidates prevail over Lai or Tsai. PRC leaders also have reached out to Ko, who seemed, for a time, to be the best chance for unseating the DPP. But electing Han, Gou, or Ko could set Taiwan up for even more trouble. Ma Ying-jeou was the most Sino-philic president ever (Chiang Kai-shek might have been pro-unification, but he hated the PRC and refused any contact or compromise with Beijing), but he held firm against Beijing’s efforts to open talks on unification. Perhaps PRC leaders are hoping that a less cautious, experienced, and savvy politician will be more open to their overtures, but even if Han, Gou, or Ko were willing to push the relationship into the PRC’s “deep water,” there is no reason to expect the rest of Taiwan to follow. A failed attempt to move the relationship forward could be even more dangerous than a continuation of the current stalemate.

Terry Gou’s most recent statements reveal an increasingly sophisticated understanding of the complexities he would face as president. On May 6, Gou said the PRC “must acknowledge the existence of the Republic of China” – a remark that echoes Tsai Ing-wen’s longstanding requirement that Beijing “must face up to the fact of the existence of the Republic of China.” Ma Ying-jeou, too, insisted that the entity he represented was a sovereign state, the Republic of China (Taiwan’s official name). Insisting on the ROC must surely dampen Beijing’s enthusiasm for a Gou presidency, but it is the only position that can command domestic support. Electing a president who thinks he can finesse his way around this designation is a recipe for cross-Strait conflict.

Nonetheless, Gou’s statements didn’t satisfy everyone. A PRC spokesman offered an oblique criticism, reminding the world that Beijing’s one China principle – which holds that there is one China, Taiwan is part of it, and it’s called the PRC – is the mainland’s bottom line. For decades, Beijing has insisted that a “two Chinas” approach was unacceptable. Meanwhile, back in Taiwan, Ma Ying-jeou and KMT presidential hopeful Eric Chu both criticized Gou on the grounds that his statement implied that the ROC and the PRC are two parts of a single China. This “two Chinas” formula is anathema to the KMT, which insists that the “one China” to which the ’92 Consensus refers is the Republic of China. Nor are many DPP supporters likely to be persuaded by Gou’s new tack, given what they see as his overwhelming financial interest in pleasing Beijing.

The Triangle Shifts from Equilateral to Acute

 It’s possible that Tsai will win renomination, the KMT will choose a candidate with deep political experience whose views are known, and Ko will choose to finish out his term as Taipei mayor. In that case, the Taiwan side of the Taipei-Beijing-Washington triangle will be relatively calm. It is increasingly likely, however, that next January Taiwanese will be asked to choose among extremes: a pro-independence DPP candidate, a pro-unification KMT candidate, and an independent whose ability to hold his own in interactions with Beijing is untested. If that is the outcome, Taiwan will not remain the stabilizing force that it has been since at least 2008.

If Lai becomes president, Beijing’s reaction is predictable, but how the US will react is anyone’s guess. If pro-Taiwan independence voices have Trump’s ear, Lai’s election could aggravate the strategic dimension of the rapidly-deteriorating relationship between the US and China, causing Taiwan to be trapped between the angry giants. If a more conventional view of cross-Strait relations is ascendant in the White House – or if Trump decides that intensifying Sino-US conflict is politically disadvantageous for him – the election of Lai could become a reason for the US to turn its back on Taiwan.

If a candidate Beijing believes will move (or can be manipulated into moving) the island toward its preferences is elected, Taiwan’s society will become even more divided than it is now. There is a very strong possibility that Taiwan’s next president will be elected with less than 40 percent of the vote (as happened in 2000, when a split in the KMT gave Chen Shui-bian the presidency with 39 percent). If Beijing expects that president to make swifter progress on cross-Strait relations than Ma Ying-jeou, who won with 58 percent of the vote in 2008, it will be disappointed. Is the Trump White House prepared to deal with the consequences of a break-down in cross-Strait relations?

With all three sides of the triangle in a heightened state of uncertainty and flux, managing relations is more important than ever. None of the three sides seems particularly well-situated to pulling off that difficult task.