To Boost the Economy, Change the System
China Times Editorial (Taipei, Taiwan, ROC)
August 9, 2016
Executive Summary: Ruling parties may change. Political parties may disappear. But not on Taiwan. The new government must address the problems of government. Otherwise it cannot implement policy. Private investment will shrink. Taiwan's economy will never recover. During the 1980s, the United States had Reagan, and Britain had Thatcher. These leaders were decisive and courageous. They enabled their countries to return to the right path. Taiwan has experienced serious problems with governance since the lifting of martial law. It too needs a new system of government, and courageous leaders able to solve problems. Is Tsai Ing-wen such a leader? Can she regain control over Taiwan?
Full Text Below:
The new government has been in power just over two months. Yet hardly one of its policies has escaped condemnation. Hardly one of its actions has escaped protest. The government failed to properly assess its policies before implementing them. The Democratic Progressive Party advocated one policy when it was out of power, but has reversed itself entirely upon its return to power. This is the “hairpin turn phenomenon” that everyone speaks of. It is part of the problem. But the real problem is the gradual disintegration of the nation's system of government. If this problem is not addressed, the economy will only get worse.
Taiwan's economy has been in the doldrums for some time. Both exports and investments have declined. Exports have declined for 17 consecutive months. July data was positive. But with the decline in the global economy, foreign think tanks have steadily lowered their economic forecasts, further marginalizing Taiwan's trade competitiveness. It is difficult to be optimistic about exports. The economy now needs a boost in investments. Unfortunately Taiwan's system of government is increasingly problematic. Both private and public investment have been affected.
Taiwan's system of government requires the government to make compromises between public opinion and the rule of law. It must do this to promote different policies and obtain the best results. But the reality is that Taiwan's system of government has disintegrated. It has lost its legitimacy. It is no longer able to resolve disputes in accordance with the rule of law. The disintegration of Taiwan's system of government has been going on for some time. It collapsed completely during the Ma's second term. Major protest movements, including the Tai Po case, the Wen Lin Yuan case, the Hung Chung-chiu case, and the Sunflower Student Movement, all undermined the authority of the government. Populist sentiment, expressed online, became the deciding force for society and even the government.
The government can no longer promote policy in a rational and professional manner. In the absence of rational debate, the Number Four Nuclear Power Plant was mothballed. The Number One Nuclear Power Plant cannot be started. This summer threatens brownouts. The Executive Yuan under Lin Chuan is pandering to populist sentiment. Media mogul Rex How says he "suspects Taipower of understating its generating capacity". He would "open Taipower up to public oversight", enabling non-professionals to rifle through Taipower's files and obtain confidential information and data.
Consider how the new government has dealt with labor strikes and legal holidays. It failed to carefully assess the situation beforehand or undertake careful planning. It failed to communicate and coordinate. It failed to address the protesters' grievances. The moment protests intensified, it timidly backed down. The result was endless policy flip-flops that curried favor with no one, and rendered problems even more intractable. Power shortages are now more likely. A nuclear-free homeland is DPP policy. Starting up the Number One Nuclear Power Plant when faced of power shortages, is not incompatible with a nuclear-free homeland. But the government lacks the necessary courage. EIAs have long affected investments. When the DPP returned to power, it failed to address this problem. By holding high the banner of environmental protection, the government made companies afraid to invest.
It is difficult to be optimistic about the future. The Ma government promoted FEPZs. But many citizens groups opposed them. They even “declared war” on them. The Tsai government yearns to join the TPP. It too faces naysayers. The new government wants to build public housing. It wants public office buildings even more. But what should be done about nail houses, and opposition from nearby residents and civic groups? The government has no solutions. Taipei Mayor Ko Wen-je enjoys high approval ratings. But when he promoted several large-scale urban planning projects, including the Nangang Bottling Plant and the Western District Renewal Plan (Mitsui Warehouse relocation), academics and citizens groups vehemently opposed him.
Simply put, any investment plan on Taiwan today, is going to run into opposition. Some will come from representative citizen groups. Others from small, non-representative extremist groups. The past system of government is utterly impotent. The World Bank studied the reasons why economic development in Africa is so difficult. It concluded the problem was a "crisis of government" afflicting incompetent and corrupt governments. Taiwan's crisis of government reflects the rise of social forces, and an inability to adopt a new model of government. The result, problems with economic development, is the same.
Social change and the rise of the Internet have made different forces harder to control. Trends fueled by politicians are even more important. When the Ma government was in office, virtually all opposition parties sided with civic organizations. They supported civic groups and public protests. They even backed the Sunflower Student Movement, opposed textbook reform, and opposed every policy advanced by the Ma government. The DPP successfully destroyed the Kuomintang and reacquired power. But in the process, it destroyed Taiwan's system of government. Now it is reaping what it sowed.
Ruling parties may change. Political parties may disappear. But not on Taiwan. The new government must address the problems of government. Otherwise it cannot implement policy. Private investment will shrink. Taiwan's economy will never recover. During the 1980s, the United States had Reagan, and Britain had Thatcher. These leaders were decisive and courageous. They enabled their countries to return to the right path. Taiwan has experienced serious problems with governance since the lifting of martial law. It too needs a new system of government, and courageous leaders able to solve problems. Is Tsai Ing-wen such a leader? Can she regain control over Taiwan?