Condi spanks Taiwan

US' top diplomat wades into cross-strait row

Newsweek "Why It Matters" blog, December 27, 2007

The US is ratcheting up its opposition to an obscure Taiwan referendum. That's especially odd since the vote -- whatever its outcome -- will have no practical effect on Taiwan's standing or on the cross-strait status quo.

The referendum, if it goes ahead as planned together with the presidential vote on March 22, will ask Taiwan voters if the island should seek to join the United Nations with the name "Taiwan." Last Friday, US Secretary of State Condoleezza Rice called the referendum a "provocative policy", adding, "It unnecessarily raises tensions in the Taiwan Strait, and it promises no real benefits for the people of Taiwan on the international stage."

Certainly, the vote won't change Taiwan's status. With China on the UN Security Council and only 24 small countries recognizing Taiwan as a sovereign state, any Taiwanese bid for UN membership -- no matter which name it uses -- is doomed. China views Taiwan as part of its territory and adamantly opposes even the most trivial Taiwanese claims to separate statehood.

Instead, the referendum is best seen as a domestic political tool: the pro-independence party, which backs the referendum, is using it as a "get out the vote" measure and to whip up Taiwan pride. To have any shot at winning, the pro-independence party needs to focus voters on the emotional issue of national identity. Thus the emphasis on using "Taiwan" -- which implies a complete break with the mainland -- rather than the island's formal name, "The Republic of China."

By contrast, if the election is decided on economic issues -- like the recent vote in South Korea -- the more China- and business-friendly Kuomintang has a strong edge. Indeed, its candidate is far ahead in the latest polls amid widespread malaise over Taiwan's anemic economy.

Given the referendum's domestic purpose, it would hardly seem to warrant the attention of a US Secretary of State who's already got her hands full patching up failed states in Iraq and Afghanistan and working on Middle East peace. So why the sharp remarks?

More than anything, they reflect China's nervousness about the coming months. Beijing fears Taipei will make a dangerous leap toward formal independence, taking advantage of China's focus on Olympic preparations. It's been leaning hard on Washington to rein in any such moves by its island ally. Rice's statements are likely the fruit of countless Chinese complaints -- and part of the give-and-take of big power politics between Washington and Beijing.

While Rice's comments may assuage Beijing, though, they're likely to backfire. The referendum looks almost certain to go ahead, despite Washington's knuckle-rapping. Meanwhile, Rice's labeling of the vote as "provocative" is an embrace of Beijing's view of the cross-strait conflict. By contrast, many in Taiwan argue that China's revanchism and rapid military buildup directly across the Strait -- now including more than 900 missiles aimed at the island -- is far more destabilizing than any symbolic, democratic vote.

As for saying the vote has "no benefits" for the Taiwan people, the fact of Rice's comments actually negates her point. Having the US Secretary of State highlight the referendum puts a rare global spotlight on the thirst of the majority of Taiwanese -- whatever their domestic differences -- for recognition as an independent, sovereign state. And in terms of Taiwan's domestic politics, her remarks only help the pro-independence party keep the campaign on its preferred battleground of national identity.

If the goal was to deter Taiwan's efforts to cement its independence, Beijing and Washington would have done better to ignore the vote altogether. Their high-profile opposition is merely likely to strengthen the hand of Taiwan's pro-independence hardliners.

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Fear and misunderstanding

Survey highlights US-China perception gap

by Jonathan Adams

"Why It Matters" blog, December 14, 2007

The US and China are talking past each other. That's abundantly clear from a survey of US and Chinese perceptions released this week by the Committee of 100, an organization of Chinese-American leaders.

The biggest perception gap was on the question "What are your two greatest concerns about US-China relations?" On the US side, the general public and business leaders cited the loss of US jobs to China as #1. For China, the top worry was Taiwan -- the self-governed island that China considers part of its territory awaiting reunification, but which the US has pledged to help defend if attacked.

The top concerns reflect largely irrational fears that are being stoked by nationalists in both countries. In fact, recent business and geopolitical trends should be blunting both worries.

Take US hand-wringing over job losses. Several studies have shown that the number of US manufacturing jobs that have gone to China is likely far smaller than China-bashers would have the US public believe (last year the pro-free-trade CATO Institute estimated 150,000 jobs per year lost to China). Certainly, overall US manufacturing jobs are sharply down, but that's part of a long-term shift toward service sector employment in the US economy (and globally) that's accelerated as better technology allows factories to produce more with fewer workers.

Another reality check: according to one study, China has been losing even more manufacturing jobs than the US, due to the downsizing of state-owned enterprises and technological upgrades. CATO cited a 2003 study by Alliance Capital Management LP in New York that found that from 1995 to 2002, China's manufacturing sector workforce shrank 15%, compared to an 11% decline in the US in the same period. Moreover, labor costs in China are rising -- particularly in coastal areas -- as the nation grows wealthier and workers demand better compensation.

One telltale sign this week: the Taiwan stock market plunged Thursday in part on news that Taiwan contract manufacturing giant Hon Hai will soon offer permanent contracts to employees at its mainland units who have worked at the company for more than eight years.

That's a preemptive move to comply with new Chinese labor regulations that take effect January 1, and which are widely expected to further boost the labor costs of firms doing business in China. Those rising costs, combined with inflation, are already driving Hon Hai and other foreign firms to expand in lower-cost places like Vietnam instead of China.

Then there's China's obsession with Taiwan. It's certainly not surprising (they're constantly bending US officials' ears on the issue). But it reflects paranoid fears about what Taiwan might do, and about what support Taipei politicians would get from the US.

In fact, Taiwan is highly unlikely to formally declare independence or make any similar extreme moves -- there's simply no consensus on the island for doing so. Meanwhile, the Chinese should be reassured by recent public US remarks. Washington has been telling Taipei more clearly than ever that it can't necessarily count on US military support if the island is seen as provoking a crisis.

Case in point: Just this week, American Institute in Taiwan chairman Raymond Burghardt repeated US opposition to Taiwan's plan to hold a referendum this March on joining the UN under the name "Taiwan". That bid has sparked perhaps the most blunt public criticism the US has ever made of its island ally. Such tough talk should help put the brakes on any possible adventurism in Taipei, and so stabilize the Strait.

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Taiwan's mountain retreats

By Jonathan Adams
Newsweek Web Exclusive, November 17, 2007

Since 2004, Jonathan Adams has lived in Taipei, Taiwan, where he reports on politics, business and economics for NEWSWEEK and other publications. Whenever he can he tries to get out of Taipei and head to the mountains. Few outsiders know it, but the small island boasts some of the most impressive alpine landscape east of the Himalayas, with jagged peaks towering as high as 12,000 feet, dramatic gorges and natural hot springs.

Headhunters and other aborigines of Austronesian stock once roamed these peaks, bedeviling waves of colonizers—Dutch, Qing Chinese and Japanese—who tried to tame the island. Now you're more likely to be attacked by aboriginal kitsch, in the form of overpriced gewgaws and "traditional" aboriginal dance shows that cater mostly to Taiwanese and Japanese tour groups. Here are some the island's most popular mountain spots:

Sun Moon Lake

At 2,400 feet above sea level, this scenic lake is tucked on the western side of Taiwan's central mountain range. When the Japanese occupied the island (1895-1945), they dammed up the Juoshuei River, enlarging this natural freshwater lake. A massive 1999 earthquake, whose epicenter was nearby, further expanded the lake to its current size and nearly inundated an island sacred to the Thao aboriginal tribe. That island now lends its name to one of Taiwan's top luxury hotels, the Lalu (www.thelalu.com.tw, 886 49 285 6888). If you have about $500 to spare, spend an über-romantic night here amid a Zen-like calm that can make this elite retreat seem more like a church than a hotel. Much cheaper digs are dotted elsewhere around the lake.

Take a boat tour on the lake, wander its many scenic hiking trails and temples, and be sure to visit the Tsen pagoda, built by the late Kuomintang strongman and Taiwan president Chiang Kai-shek in memory of his mother. President Chiang had porters shlep him up the steep trail to pay his respects to Mom; you'll probably have to make the climb yourself.

The lake is in betel nut country; look for groves of the mild stimulant, which is popular with Taiwanese truck drivers and other workers. Or if you're coming in on the road from Taichung, look for Taiwan's famous "betel nut beauties," teenage or twentysomething working-class girls who operate on a simple, effective calculation: the less they wear, the more customers they're likely to attract to their betel nut stands.

Alishan National Park

This is probably Taiwan's most well-known mountain resort, at least in the Chinese-speaking world, thanks to a beloved folk song that sings the landscape's praises. The name means "Ali mountain," but the resort covers a series of peaks. In my opinion the place is overrated, with ugly parking lots and concrete complexes of mediocre restaurants and souvenir hawkers lying in wait for tourists. And the social pressure to get up in the dark at 4 a.m. to see the sunrise over the mountains is intense; woe betide the tourist who would rather just sleep in.

But train enthusiasts should be sure to visit by the fantastic Alishan Forest Railway, which runs from the city of Chiayi to the west. The line was built by the Japanese in order to transport cypress and other woods from the mountaintop. It makes a steep climb across narrow bridges and over vertiginous ravines, and features a switchback toward the top in order to navigate the last bit. Be sure to check ahead that the line is running; the railroad is vulnerable to landslides and other obstructions, which frequently shut it down for days (www.railway.forest.gov.tw). Bus lines and tour groups also take visitors up to Alishan from Chiayi. For high-end accommodations, try the Alishan House (www.alishanhouse.com.tw, 886-5-267-9811).


Taroko National Park

This stunning marble-lined ravine is one of the island's most beloved sites. Tour buses driven by betel-nut-chomping drivers career down narrow cliffside roads blaring Taiwanese pop, periodically belching out camera-toting tourists at scenic sites along the way. Upscale visitors should spend the night at the Grand Formosa Taroko in Tienhsiang (www.grandformosa-taroko.com.tw, 886-3-869-1155); much cheaper and simpler accommodation is available just up the road at the Catholic hostel. The scenery is striking, sometimes literally—the gorge is one giant falling rock zone. Just outside Tienhsiang is an excellent outdoor natural hot spring. However, it's been closed ever since some rocks tumbled down in 2005, killing one person and injuring several others. Package tours, like those offered by Zion Tours (www.formosaholidays.com.tw, 886-2-2100-1256), include the gorge; otherwise get to Hualien by train and switch there to a bus, taxi or rented scooter to Tienhsiang.

Chihpen Hot Springs

The Japanese brought their hot-spring culture to the island as colonizers. One of their favorite spots, and now the location of a strip of hot-spring hotels, lies just to the southwest of Taitung, in southeast Taiwan. The best is the Royal Chihpen (www.hotel-royal-chihpen.com.tw, 886-89-510-666); a personal favorite is Dongtair (www.dongtair-spa.com.tw, 886-89-512-918), which boasts a massive outdoor hot-spring complex just across the road from the main building. Those springs are coed, and swimsuits and caps are required; other hotels have male- and female-only springs where it's de rigueur to soak buck naked.

Try an invigorating hike in the nearby forest park, then a half-hour under the jets for utter relaxation. To get there, fly Far Eastern Air Transport or Uni Air from Taipei to Taitung, then switch to a hotel shuttle, taxi or train to Chihpen station.

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