Tuesday, March 18, 2014

Campaign Promises: Vote Buying, or Public Welfare?

Campaign Promises: Vote Buying, or Public Welfare?
China Times editorial (Taipei, Taiwan, Republic of China)
A Translation
March 19, 2014

Summary: The year end elections are six months away. We are concerned that the bandwagon to increase the number of holidays is just getting warmed up. The next election will result in even more outrageous campaign promises. The ruling and opposition parties will compete in their efforts to bribe voters. But can Taiwan's competitiveness and the government's finances withstand the stress? We doubt it.

Full text below:

The Ministry of the Interior invited the business community and local governments to discuss legal holidays. They decided that when a national holiday lands on a two day weekend, employees will receive compensatory leave. Next year will have 115 non-working days. This was in response to an earlier declaration by Premier Chiang Yi-hua, who wanted to increase the number of holidays so that people could enjoy a "small but real benefit."

In fact, everyone knows this is a charade. It is simply a Blue Camp post-Chinese New Year election ploy in the upcoming local election campaigns. Take for example, the Chinese New Year. New Taipei Mayor Eric Chu said people want pay raises, but giving them pay raises is hard. Instead, if the government allows people to have more days off, it will stimulate consumption and make people felt better. Taichung City Mayor Jason Hu then announced that the Taichung City Council proposed making the traditional Hakka Festival a legal holiday. If the bill is passed, it will be submitted to the Executive Yuan. Taipei mayoral candidate Lien Sheng-wen let it be known that if elected he would restore Constitution Day, making December 25 a holiday. This would increase tourism and create economic value. Faced with such artificial presssures, Premier Chiang Yi-hua said the government must view these "small hut real benefits" through the peoples' eyes. He wanted to study the possiblity of changing the legal holidays next year.

A gaggle of politicians have spoken up just in order to have more days off, Premier Chiang Yi-hua in particular. He even adopted the younger generation's vernacular, and used the expression "small but real benefits." As we can see, the political elites are eager to pander to the public. Eric Chu was the most direct. Since they cannot get raises, they may as well get more holidays. After all, when it comes to holidays, who besides the business owner or employer is going to disagree? Administratively speaking approving extra days off is not that complicated. The ruling and opposition parties are accustomed to competing to see who can legislate the most holidays. This would never lead to all out war, such as that over the trade in services agreement. As anyone can see, most of the politicians who have spoken out in favor of more holidays are candidates in county chief and city mayor elections. Their mouths are full of talk about holidays. But their heads are full of thoughts of votes.

Everyone is of course happy to take more holidays. But anyone who knows anything about economics knows that there is no such thing as "more holidays for economic revitalization." Otherwise, why not simply implement a three day weekend? Then Taiwan's economy would really take-off, right? A few years ago the IT industry was hit by the global financial crisis. This brought upon economic winter and severe recession. Technology and electronics manufacturers resorted to "unpaid leave." No employees rejoiced at the extra days off. They worried that their jobs were no longer secure. They were less likely to take advantage of the opportunity to go shopping. Their income was no longer assured, so why would they want to spend? What's more, the productivity loss must be borne by the employer. Manufacturers may suffer lowered productivity and refuse to increase pay. The price of the vicious cycle will ultimately be borne by the public.

This wave of controversy, motivated by year end campaign considerations, is nothing new. During the previous five cities elections, Taichung mayoral candidate Su Chia-chuan declared that, if elected, he would increase welfare payments to the elderly, from 1,600 NT to 2,000 NT. Other welfare benefits for the elderly would also be provided. They would be comparable to with those provided by Taipei and Kaohsiung. Taipei mayoral candidate Su Tseng-chang was even more magnanimous. He proposed distributing prepaid garbage bags to the public, for free.

Political candidates compete in using public funds to engage in vote buying. Some scholars are disgusted. They have cited Bureau of Audit statistics. They have cited the outstanding balances in central government public debt for the past year, This increased from 2.6490 trillion NT in late 2001 to 4.2962 trillion NT. Fortunately the candidates who promised the stars were not elected. That spared the treasury from accelerated bankruptcy. But bipartisan vote buying is long-term policy. The government's fiscal balance has deteriorated, By the late January, outstanding balances on central government debt were 5.4618 trillion NT. Next year we are is likely to hit the government debt ceiling.

Every election year, all manner of improvised, short-sighted electioneering tricks emerge. In the past, it was common to use welfare checks as bait. Most common were a variety of annuities. After all, the local governments can make these promises ahead of time, and later blackmail the central government into footing the bill. If they don't succeed, they can provoke other disputes. Election promises have recently created in a new precedent. Council members in six Changhua townships fulfilled campaign promises by privately connecting street lamps without paying for the electricity. Taipower sought payment from the Township Office. But the township administration refused to pay. Taipower sued and won. But the Township Office insists it has no money to pay its electricity bills. The result is six townships will now have a bunch of unlit street lights.

Several major bills are pending in the Legislative Yuan. Most commentators are pessimistic about them passing because this is an election year. Each time an election rolls around, everyones' thinking becomes distorted. The ruling and opposition parties compete in short-sighted pandering to the public. For example, they compete in issuing a variety of annuities. Which beneficiary is going to object? A few extra days off? Who doesn't love that? Will it undermine the government's finances? Will it affect national productivity? Who cares?

The year end elections are six months away. We are concerned that the bandwagon to increase the number of holidays is just getting warmed up. The next election will result in even more outrageous campaign promises. The ruling and opposition parties will compete in their efforts to bribe voters. But can Taiwan's competitiveness and the government's finances withstand the stress? We doubt it.

中國時報 本報訊 2014年03月19日 04:10



不過就是為了多放幾天假,竟惹得一堆政治人物搶著表態,尤其閣揆江宜樺,連新世代的流行語言「小確幸」都搬出來了!可見得為了討好民意,政治精英們可是卯足了勁。特別是朱立倫的說法最直接,既然加不了薪,就加假嘛!畢竟談到放假,除了企業主或雇主之外,有誰會反對? 在行政作業上,核定多放幾天假一點都不複雜,朝野政黨習慣競相加碼,不可能鬧到像審議《服貿》般全面開戰。任誰都看得出來,這一波衝著放假表態的政治人物,絕大多數都是現任民選縣市長或是爭取提名的候選人,他們口中講要多放假,心中想的,不折不扣是選票!







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