Every economic policy has advantages and disadvantages. Sound policymaking involves a balance so that benefits are maximized and drawbacks minimized. A corollary of this is that policymakers ought not take significant risks to gain small advantages.
President Ma Ying-jeou (馬英九) and his administration are focusing on only the benefits of their cross-strait economic and trade policies and ignoring their disadvantages.
The result of this approach is that necessary precautions for the possible negative consequences of these policies are being ignored.
If this behavior only applied to the occasional policy, it would be understandable and forgivable.
OVERLOOKING
But there is growing evidence that the Ma administration is overlooking almost every possible negative consequence of its cross-strait initiatives.
Direct cross-strait flights are one example of this approach. Ma has repeatedly said that the flights would make it easier to sell Taiwanese produce to China and would therefore benefit Taiwanese farmers.
However, he has neglected to mention that the reverse is also true: Direct flights will make it easier for China to sell its produce in Taiwan — thus adversely affecting the domestic agricultural industry.
The fact is that the amount of produce and processed agricultural products that China exports to Taiwan already exceeds the amount that Taiwan exports to China by a factor of five to six.
With the convenience of direct cross-strait links, it is very likely that this situation will persist. China will continue to sell five or six times more produce and processed goods in Taiwan than Taiwan sells in China.
COVERING UP
However, the Ma government has tried to cover up the repercussions of its poorly designed policies and has managed to convince the public that direct flights will be a complete success as far as Taiwanese farmers are concerned.
The government has also failed to take necessary precautions against the negative consequences that will follow from this.
The Ma administration promotes direct flights by saying that they are likely to attract more Chinese tourists, but again it has avoided mentioning that it will also be more convenient for Taiwanese tourists to visit China.
Considering that a three-day trip to China currently costs less than a trip to Kenting (墾丁), Hualien or Taitung, many holidaymakers are likely to prefer taking their vacation in China rather than staying in Taiwan.
ABOLISHED
In addition, the government recently abolished regulations stipulating that public servants could only apply for subsidies using their Citizen’s Travel Card (國民旅遊卡) while traveling abroad. This will have a serious impact on the development of the domestic recreation and tourism industries.
Moreover, those traveling to China will bring back low-priced products.
This will in turn harm the nation’s retailers.
The Ma administration isn’t taking this likely fallout seriously, and the result is that it has not mapped out complementary measures to reduce the impact.
Many such incidents demonstrate that the Ma administration and associated individuals have attempted to conceal the risks of the government’s cross-strait policies by exaggerating the benefits.
Chen Po-chih is chairman of Taiwan Thinktank.
TRANSLATED BY TED YANG
In their recent op-ed “Trump Should Rein In Taiwan” in Foreign Policy magazine, Christopher Chivvis and Stephen Wertheim argued that the US should pressure President William Lai (賴清德) to “tone it down” to de-escalate tensions in the Taiwan Strait — as if Taiwan’s words are more of a threat to peace than Beijing’s actions. It is an old argument dressed up in new concern: that Washington must rein in Taipei to avoid war. However, this narrative gets it backward. Taiwan is not the problem; China is. Calls for a so-called “grand bargain” with Beijing — where the US pressures Taiwan into concessions
The term “assassin’s mace” originates from Chinese folklore, describing a concealed weapon used by a weaker hero to defeat a stronger adversary with an unexpected strike. In more general military parlance, the concept refers to an asymmetric capability that targets a critical vulnerability of an adversary. China has found its modern equivalent of the assassin’s mace with its high-altitude electromagnetic pulse (HEMP) weapons, which are nuclear warheads detonated at a high altitude, emitting intense electromagnetic radiation capable of disabling and destroying electronics. An assassin’s mace weapon possesses two essential characteristics: strategic surprise and the ability to neutralize a core dependency.
Chinese President and Chinese Communist Party (CCP) Chairman Xi Jinping (習近平) said in a politburo speech late last month that his party must protect the “bottom line” to prevent systemic threats. The tone of his address was grave, revealing deep anxieties about China’s current state of affairs. Essentially, what he worries most about is systemic threats to China’s normal development as a country. The US-China trade war has turned white hot: China’s export orders have plummeted, Chinese firms and enterprises are shutting up shop, and local debt risks are mounting daily, causing China’s economy to flag externally and hemorrhage internally. China’s
US President Donald Trump and Chinese President Xi Jinping (習近平) were born under the sign of Gemini. Geminis are known for their intelligence, creativity, adaptability and flexibility. It is unlikely, then, that the trade conflict between the US and China would escalate into a catastrophic collision. It is more probable that both sides would seek a way to de-escalate, paving the way for a Trump-Xi summit that allows the global economy some breathing room. Practically speaking, China and the US have vulnerabilities, and a prolonged trade war would be damaging for both. In the US, the electoral system means that public opinion
RSS