US Senate hears support for arms sales
　

BALANCE: Although Taiwan’s request for 66 F-16 fighter planes was not addressed directly, the remarks come just before Secretary of State Hillary Clinton’s trip to Beijing
　

By William Lowther
STAFF REPORTER IN WASHINGTON
Saturday, Feb 14, 2009, Page 1

US National Intelligence Director Admiral Dennis Blair strongly indicated before a Senate committee on Thursday that Washington may sell more arms to Taiwan to maintain a balance with China.

While the admiral did not say which arms he had in mind, he was speaking only a day after former US diplomat Harvey Feldman, another Asia expert, said that US President Barack Obama’s new administration should provide the 66 F-16 fighter planes requested by Taipei.

Blair’s testimony before the Senate Select Committee on Intelligence came just a week before US Secretary of State Hillary Clinton leaves on a six-day trip to Asia.

China is expected to challenge Clinton on US arms sales to Taiwan when she in Beijing next Friday, but Blair’s remarks could make the issue even more important from the Chinese point of view.

Political insiders said it was unlikely the admiral would speak openly on such a delicate subject without Obama’s support.

“Taiwan should not be so defenseless that it feels it has to do everything that China says,” Blair said. “China cannot be so overwhelming that it can bully Taiwan.”

Speaking at a hearing on national security threats to the US, Blair said that China’s huge military spending increases — last year’s budget jumped 17.6 percent to about US$61 billion — “pose a threat to Taiwan.”

“Unless Taiwan does something about it, then we’re really the only other country helping them do it. That means we’re going to have to help them some more in order to maintain a balance,” he said.

Political analysts speaking on condition of anonymity said later that this last remark was a clear indication of the admiral’s support for further arms sales.

Beijing was furious last October when former US president George W. Bush announced a US$6.5 billion arms package for Taiwan.

Blair, who heads 16 US intelligence agencies, is an expert on the Taiwan-China military situation in his own right.

On Wednesday at a round table discussion at the Washington-based Heritage Foundation, Feldman, who helped to write the Taiwan Relations Act, said President Ma Ying-jeou’s (馬英九) government had requested another 66 F-16 fighter planes and that there was still no indication of how the Obama administration would respond.

In his testimony before the Senate committee, Blair said: “Taiwan, as an area of tension in US-China relations, has substantially relaxed. Taiwan President Ma, inaugurated in May, has resumed dialogue with Beijing and leaders on both sides of the straits are cautiously optimistic about less confrontational relations.”

“But preparations for a possible Taiwan conflict nevertheless drive modernization goals for the People’s Liberation Army and China’s security interests are broadening beyond Taiwan,” he said.

Democratic Senator Dianne Feinstein, who heads the committee, said that the China-Taiwan relationship had a very difficult dynamic and asked what the committee should keep in mind.

Blair said: “As far as what we can do, a key part of it is making sure that military measures are unattractive to all sides. And that means maintaining the balance, which is really what the Taiwan Relations Act calls for.”

“On the other hand, Taiwan has to realize that its long-term security lies in some sort of an arrangement with China. It does not lie in military defenses. So if we can keep that balance correct, then all of the incentives are toward solving the problems in political and people-to-people ways. I think there are arrangements that could be made that would give Taiwan the international space that they feel they deserve and give China the reassurance that ‘one China’ is a realistic policy,” he said.

“We just have to make sure that military adventures are unattractive,” he said.

In related news, newly appointed US Deputy Secretary of State James Steinberg said on Thursday that the US welcomes closer cross-strait ties and would continue to support both sides’ efforts to overcome their differences through peaceful means.

Steinberg made the remarks in Washington while attending the annual National Council for Visitors, where Obama’s foreign policy was described.

Steinberg served as deputy national security adviser during the second term of former US president Bill Clinton, and during the 1996 Taiwan Missile Crisis he met with Taiwan’s National Security Council Secretary-General Ting Mao-shih (丁懋時), creating the primary channel of communication between the two nation’s national security agencies.

Asked what he thought about the current cross-strait situation, Steinberg said that the US would keep a watchful eye on Taiwan-China relations, as they are one of the most important issues on Washington’s foreign affairs agenda.

Steinberg said the US has maintained the same cross-strait policy for more than 30 years, as it has served the best interests of the parties involved and has helped maintain peace and stability in the area.

The interaction between the people, the closer economic ties and the increasing cultural exchanges between Taiwan and China are remarkable achievements for the leaders of the two sides, Steinberg said.

Be wary of China and diversify, Therese Shaheen says
　

In the face of the economic tsunami sweeping the planet, a growing number of countries, including the US, are looking to Beijing as a strategic partner. In an interview with ‘Taipei Times’ reporter Jenny W. Hsu yesterday, former American Institute in Taiwan chairwoman Therese Shaheen warned that an overreliance on China could be dangerous and that Taiwan had to rely on its inherent advantages and diversify its investments if it is to weather the crisis

By Jenny W. Hsu
STAFF REPORTER
Saturday, Feb 14, 2009, Page 3
　

Taipei Times: Can you tell us about US President Barack Obama’s policy on Taiwan?

Shaheen: Generally speaking, Obama’s policy toward Taiwan will not change. It will be based on the “one China” policy, the Three Communiques and the Taiwan Relations Act. But I think there is something broader that forms US policy toward Asia, and that is the US’ priorities at [any given] time.

In the last administration, the US’ priority was 9/11, which came eight months into [US president George W.] Bush’s first term. Even though US policy didn’t change, that [event] shaped the US’ attitude and perspective for the rest of his term.

Now, with the Obama administration, I presume it would be the same. Now we have what a lot of people have called the “economic 9/11,” so that would be the top priority of the Obama administration unless something supersedes that. So the US will look at Asia through the eye of the economic crisis. The conventional wisdom [in Washington] is that China is the driving force behind potential Asian growth. I believe the current perception of the US government [is] ... that China is perhaps an equal partner to the US in solving this crisis. My argument today is that it is not.

The Chinese economy is structurally unsound. I believe the leaders know this and they are trying to correct the problem. But because of years of driving growth up at the expense of rising living standards and, ultimately because it is hollow growth and because everyone looked to China’s growth, growth became the goal, not further developing the economy and the health of the entire economy. So what happened is that the Chinese government became more and more reliant on foreign direct investment and exports at the expense of domestic consumption, exports into China, or rising income and a better standard of living.

If we use the analogy of boats, Taiwan is a motorboat and the US is a large cruiser, and China is a huge freighter, so it can only move slowly. It’s large ... and it’s not modernized to the extent that Taiwan and the US are, so it would be very difficult to [raise the living standards of the rural poor in China]. China, regardless of the amount of stimulus that it throws at the problems, will not be able to turn as fast, and therefore will not be able to outrun the time it will take the US to get through the recovery.

TT: How do you think the economic crisis will affect the relationship between Taiwan, the US and China? Should Taiwan be worried that the US will lessen its support in an effort to make Beijing an economic partner?

Shaheen: I think it’s a legitimate worry, which is why I’m spreading the word that China is in worse condition than any of the developed economies in Asia. The Chinese leaders know this. Two years ago, [Chinese] Premier Wen Jiabao [溫家寶] said the Chinese economy was unstable, unstructured, uncoordinated and unsustainable.

Many people in the US believe that the PRC [People’s Republic of China] is the US’ banker. This is absolutely untrue. Any country that has a trade surplus with the US or any countries that have goods that are dollar-dominated must have US dollars. They are prisoners of the US dollar ... so their keeping dollars is largely involuntary ... and [China] has to continue to buy US treasury [notes] in order for its dollars to continue to earn what they are earning [now].

TT: How do you think it will affect political ties between Taiwan and the US? Could the US become so desperate to revive its own economy that it would do so at the expense of Taiwan’s sovereignty?

Shaheen: No, they don’t need to appease China, if it is understood that China will follow the US out of the recession.

The Taiwanese economy is much healthier than the Chinese economy. Even though Taiwan has an overreliance on exports, the Taiwanese move like fighter pilots. They make decisions like fighter pilots. Don’t forget who you are.

The first thing [the Taiwanese] should do is to diversify away from China. I would not put more money in China unless you absolutely have to. Diversify away from China, not because China is bad, but because you should always have a diversified investment portfolio.

TT: Do you think the Taiwanese government and Taiwanese businesspeople are overreliant on China?

Shaheen: I say anybody’s portfolio should be diversified. China’s economy has been sick for a long time. There was the stock market crash in 2007 and the housing collapse shortly after, so that means China had its own subprime crisis before the US. So to think China can lead us out of the recession is not correct. Even though Taiwan is in its own sticky wicket ... I believe the Taiwanese people will reorganize, rethink and move to other countries, focus on other industries and the Ma [Ying-jeou (馬英九)] administration can lead Taiwan out of this.

The Taiwanese can do almost anything because they have good brain power and they are quick movers. Taiwan will turn very quickly, quicker than almost anybody else. But Taiwan does start with a problem that it is being too dependent on China. So it would be absolutely the wrong advice to be more dependent on China ... Taiwan is in the situation it is in because it was already too dependent on China.

TT: Are you concerned that in order for Taiwan to make any political gains, the Ma or the Obama administration would do so by shortchanging Taiwan or agreeing to become even more dependent on China?

Shaheen: Generally my answer would be no, and let me tell you why: I have been pushing for the three links for a long, long time. I am for China growing in a healthy way. If the Ma administration can get membership for Taiwan at the WHO, that would be fantastic. Only if real economic sacrifice by Taiwan had to be made to placate the PRC would I have a problem with it. If China can help Taiwan to move on some of these political issues, God bless. But don’t think for a minute that Taiwan should depend on China economically. That is a trap, a spider trap. It doesn’t mean don’t trade with China. Diversification is the key to both economic and political freedom. So don’t make the mistake of not diversifying. It is certainly the time to diversify more.

TT: Should Taiwan be suspicious of Beijing’s “goodwill” gestures of the last few months? Can Taiwan continue to count on the US for support?

Shaheen: Taiwan should always think first of its own self-interest and keep that in mind. President Ma has pledged to do this. So I think he should be trusted. The Taiwanese people must know they should not trust anything other than their own self-interest. Think of yourself first.

Taiwan should count on itself. The US is a friend, but count on yourself. Taiwan ... became the semiconductor capital of the world and ... even when [Taiwanese manufacturers] started to produce in China, I had no problems with that because Taiwan kept up with the best design and the best innovation. This made Taiwan important. Taiwan demanded the world’s attention. Depend on yourself and the world will notice.

TT: What should Taiwan do to keep its competitive edge?

Shaheen: Taiwan is in the motorboat. Taiwanese competitiveness is razor sharp ... because it has small and medium-sized businesses and because it has large businesses but not on the scale of Japan or [South] Korea. One reason is because it is a smaller country, but also because of national temperament. Taiwan has many entrepreneurs and small and medium-sized businesses which should be [encouraged], because that’s where you will win.
　

The gullible Taiwanese

Dear Johnny,

I am wondering if you could share with us your insights on the following matters.

First, what do you think of Diane Lee (李慶安)? Do you think that the public will eventually get their money back from her? US$3 million can buy a lot of lunches for schoolkids, you know!

Secondly, why is it that there are so many gullible Taiwanese who want to believe anything that the KMT tells them? In the past, the KMT told us that our economy was terrible and that it was A-bian’s (陳水扁) fault even though our GDP and the unemployment rate were okay. Nowadays, the KMT says that it’s not their fault that hundreds of thousands of people are losing their livelihoods — because it all comes down to a disastrous global economy.

Or else they say that everything in our lives that has gone wrong is down to A-bian. There are a lot of Taiwanese who believe every piece of BS that they come up with. Why?

YOUR AVID READER

Johnny replies: Diane Lee is the most inspiring immigrant that my beloved homeland has ever hosted. And no, we won’t see any of the money.

Finally, why not ask those gullible Taiwanese for yourself? Don’t forget your baseball bat.

I would suggest that the rewards of steady income, job advancement and sheer comfort make BS taste a little less nasty.

What course will US-PRC relations now take?
　

By Paul Lin 林保華
Saturday, Feb 14, 2009, Page 8

US SECRETARY OF State Hillary Clinton’s first overseas trip since assuming office will be to Japan, Indonesia South Korea and China. She had originally decided to visit only Japan, with the other destinations added later. This shows that the US sees Japan as a top priority in Asia for its global strategy. After all, the US signed the Treaty of Mutual Cooperation and Security with Japan in 1960.

As this affects Taiwan’s security, it should be good news. Clinton included China in her trip not only because the US cannot afford to ignore China but also because US Treasury Secretary Timothy Geithner told a Senate confirmation hearing that US President Barack Obama believed China was manipulating the yuan, drawing Beijing’s criticism.

Both former president Bill Clinton and his successor, George W. Bush, condemned China during their election campaigns. After taking office, however, they made an about-face, and US-Taiwan relations deteriorated. In contrast, Obama seldom expressed opinions on US-China relations during his election campaign. But the Democrats seem to be more concerned about the rights of the disadvantaged than the Republicans, so the Obama administration might be more critical of China.

On the surface, there will not be any major differences in the US position on the Taiwan issue compared with Obama’s two predecessors. Nevertheless, Hillary Clinton is a politician in her own right, so it is hard to predict what course US-Taiwan relations will take.

US State Department acting spokesman Robert Wood said Clinton would discuss the financial crisis, humanitarian issues, security concerns and climate change with China. Humanitarian issues include human rights, Tibet and women’s empowerment, he said. On Jan. 27, Clinton said the economy was only one issue in US-China relations and that the US government wanted a comprehensive dialogue.

On Feb. 2, the Japanese Web site Daily Yomiuri Online published a report from Washington saying the Obama administration would launch a new, comprehensive, strategic dialogue with China that includes high-level talks on political, economic and security issues. The report also said the US hoped to upgrade bilateral talks through periodic visits by US Vice President Joe Biden and Chinese Premier Wen Jiabao (溫家寶). In the past, lower-level discussions were used by China as an excuse to dodge serious bilateral dialogue. It seems clear that US-China relations will break through the limited and formalistic framework adopted by the Bush administration, which focused on economic issues.

If the US stresses freedom, human rights and security issues, it will benefit Taiwan. The issue of independence is a matter of differences between Taiwanese and Chinese values.

Hillary Clinton has had direct problems with China on two occasions. The first time was in 1995, when she attended the World Conference on Women in Beijing. She was unhappy with China when she saw authorities block non-governmental organizations from staging protests.

The second time was in 2003, when her autobiography was published. In its simplified Chinese version, published by Yilin Publishing House, almost all content referring to China was deleted or altered. She was infuriated and learned first-hand how the Chinese control information.

Taiwan, on the other hand, enjoys freedom of information. Furthermore, not only have we had a two-term female vice president — Annette Lu (呂秀蓮) — but the Democratic Progressive Party is led by a woman, Tsai Ing-wen (蔡英文). The differences between Taiwan and China are obvious.

The US will not act impetuously on cross-strait issues, but Taiwan should make the most of the situation and look for bargaining chips.

Paul Lin is a political commentator.