Stolen assets on Oct 14, 2004

DPP accuses KMT of trying to launder stolen assets

By Debby Wu
STAFF REPORTER

The disposition of Chinese Nationalist Party (KMT) assets was at the heart of a controversy revealed by the Democratic Progressive Party (DPP) yesterday, as lawmakers alleged that the KMT was trying to launder its stolen assets by selling them to itself.

The DPP caucus said that Walter Wang, the son of China Life Insurance Co chairman Wang Chang-ching, has been helping the KMT plan the sale of party-owned Central Investment Holding Co.

Walter Wang is the head of Intellectual Capital Confederation Corp, a consulting company.

"Walter Wang may be trying to help cut a deal between Chinatrust Financial Holding Co chairman Jeffrey Koo's family and the KMT over Central Investment Holding Co," DPP Legislator Chang Hsueh-shun, who is in charge of the DPP task force on investigating the inappropriately obtained party assets, said yesterday.

In addition to his business roles, Jeffrey Koo is also a member of the KMT's Central Standing Committee.

Earlier it had been reported that the Koo family was among the interested bidders for Central Investment Holding Co.

But Walter Wang refused to comment on the DPP's revelation yesterday.

"As a professional consulting company, we are not allowed to comment on things like this," Wang said.

Meanwhile, the DPP caucus also said that the KMT had returned only 1 percent of its stolen assets, instead of the 80 percent that the KMT has claimed. The DPP said the KMT still has more than NT$20 billion assets in its possessions.

The DPP caucus said that the KMT has returned 1.12 percent of the stolen assets, but was trying to avoid returning the rest of its assets.

"So far the property the Ministry of Finance and the KMT have agreed to return to the national treasury is only a small part of all the inappropriately obtained assets. There remains about 99 percent of the assets still waiting to be dealt with," Chang said.

"According to the real estate estimates publicized by the government, the unreturned assets are worth over NT$20 billion. We hope the KMT can become sincere about returning these assets," Chang said.

Chang also made allegations of funds having been transfered from secret sources to help the KMT launder its assets, but he did not give any concrete evidence.

When asked whether the funds could have come from China, Chang said he had no idea, but that the task force was working to learn more about the secret funds.

DPP caucus whip Lee Chun-yee , meanwhile, urged the public to help uncover which assets the KMT stole.

"After we have gathered all the information, the caucus will offer its version of a statute governing stolen party assets, and attach all information regarding the assets with the statute, so that anyone who helps the KMT by purchasing its assets will be held to account as an accomplice in helping the KMT launder its stolen goods," Lee said.

Why not annex the US?

As Article 4 of the Constitution states, "The territory of the Republic of China [ROC] within its existing national boundaries shall not be altered except by a resolution of the National Assembly."

But what is the ROC anyway? Where is it? If it still exists today, where are its national boundaries?

In fact, a mere 26 weak and tiny countries acknowledge the so-called ROC. As for leading powers -- such as the US, the European Union (EU), Japan and China -- none recognize the ROC's existence. The state that they are dealing with is called "Taiwan," whose current territory includes Taiwan, Penghu, Kinmen and Matsu.

The ROC is simply the ancestral tablet before which Taiwan's pro-unificationists pray: it was eradicated from Chinese history a long time ago. However, the pro-unification camp has refused to accept this fact, and continues to tightly embrace the ROC corpse. In the name of national unity and completeness, the rest of the Taiwanese people have been forced to pray before the same ancestral tablet.

According to the geography textbooks we study in school, the territory of the ROC includes Mongolia and the People's Republic of China (PRC). ROC territory thus consists of three countries: Taiwan, China and Mongolia. What kind of super-imperialistic Constitution is this, including the lands of other countries in its own territory? Since no one takes the Constitution seriously, perhaps we can act even more ridiculously, and call an extraordinary session of the National Assembly to annex the territories of the US and Japan.

This Constitution was passed on Dec. 25, 1946, when the Chinese Nationalist Party (KMT) still ruled China. It was promulgated on Jan. 1, 1947, and came into force on Dec. 25 the same year. Comparing the situation at the time with Taiwan's current situation, we see that our country is still wearing a suit tailored for China 60 years ago, and is unable to shake it off.

Any democratic country abiding by the rule of law has a basic national law. Even totalitarian China has a constitution it uses to show off its civilized behavior. Taiwan, however, still uses the Constitution of a non-existent country -- the ROC -- and because it is inappropriate, it is repeatedly amended.

It has now been amended nine times in all, but problems still abound. What's worse, each amendment leads to a major political crisis, amost splitting the country in two. This is too high a price to pay.

A sound democracy must have an appropriate constitution. The meaning of that constitution can then change with the times. The text of the US Constitution, for example, is simple, and, as times change, interpretations by the Supreme Court serve to further consolidate its spirit. This means that the US can solve constitutional disputes simply by calling for a constitutional interpretation instead of through a major amendment process at high political cost.

In a videoconference last week, former president Lee Teng-hui gave a speech to US officials and academics, once again stressing Taiwan's need for a new constitution. Lee could well be called the best spokesperson for a new constitution, since the amendments made during his presidency led to political attacks from his political foes, incessant political disputes, and political instability. A constitutional amendment is thus no longer the ideal solution to the constitutional crisis.

A new constitution is now Taiwan's only choice.

Chen walked fine line in speech

By Lee Fu-chung 

Since former president Lee Teng-hui declared his "special state-to-state" policy in 1999, no matter under which political regime, the people of Taiwan in principle have not recognized the "1992 consensus," where both sides of the Taiwan Strait agreed on as much as they could on the formula of "one China, with each side having its own interpretation."

Although President Chen Shui-bian called the spirit of this formula a "consensus" or "agreeing to disagree" a few times at the beginning of his administration in 2000, contextually speaking the stance of the Democratic Progressive Party (DPP) is firm that both sides of the Taiwan Strait have never come to terms with "one China." In regard to the "each side having its own interpretation," it was a special means to push for the Koo-Wang talks in 1993.

The Chinese, however, clings to the phrase "one China" and generally ignores all other ambiguities; in the international community, "one China" means the People's Republic of China (PRC), but considering the unique linguistic qualities of the PRC's language in relation to Taiwan, China interprets the meaning of "one China" as "both the Mainland and Taiwan are a part of China."

But China's uncompromising stance on its international affairs is obvious to all; it believes that the government of the PRC is the sole government representing China, and no other interpretation by Taiwan is allowed. In reality, if our expectations regarding the 1992 meeting in Hong Kong depend on the Chinese government loosening up on its "one China" interpretation, then the "1992 consensus" was actually not a consensus at all.

Beijing has for years insisted that a cross-strait agreement on the meaning of "one China" was reached at the 1992 meeting in Hong Kong; in other words, China is accusing Taiwan of refusing to admit that it has changed its mind. Whether the former Straits Exchange Foundation (SEF) legal head Shi Hwei-yow made any promise to Zhou Ning, a representative from China's Association for Relations Across the Taiwan Strait (ARATS), about the "one China" principle in the 1992 meeting is key to resolving the controversy.

In fact, the meeting's main purpose was to reach agreements on the issues of cross-strait certified mail and professional certification. No agreements were signed due to differences in interpreting the "one China" principle, and hence the delegation of the ARATS stopped any further negotiations and returned to Beijing on Nov. 1. Waiting for a few days and not seeing any signs that the meeting could resume, Shi then returned to Taiwan.

From a brief transcript of the 1992 meetings from Oct. 26 to 29, we can assert that the representatives of both sides of the Strait did not reach any substantial conclusion about the definition of "one China" at the time. In turn, it was not until both sides returned to their respective nations before ARATS asked for SEF's copy of its original proposal [about "one China"] by sending a letter asking for ratification of the agreement on Nov. 16.

Obviously, after Zhou went back to Beijing, a thorough analysis by Chinese authorities was conducted and the Chinese were excited about the SEF's sentence that "the two sides insist on the one China principle," and was eager to gain official acknowledgement.

On the Taiwan side, the authorities probably realized that the implications were extremely serious, and so they delayed responding. ARATS then took the initiative and eagerly planned the Koo-Wang talks. After obtaining mutual consent, these cross-strait talks finally took place in 1993.

From a historical perspective, there is not enough evidence to support a bilateral consensus on the "one China" principle. We can only say that if an agreement was signed in the four-day meeting rather than left hanging, it would be difficult for Taiwan to deny the "1992 consensus."

In the past 12 years, the political environment in Taiwan has gone through a major change, and the concept of "one China" now is not the same as in 1992. As a result, since the "special state-to-state" policy was proposed by Lee, the government has ceased talking about the "1992 consensus," which is pragmatic considering Taiwan's political environment. Chen, in his Double Ten National Day speech, mentioned his willingness to "use the basis of the 1992 meeting in Hong Kong" to reopen a channel for a cross-strait dialogue.

Chen revealed his grasp of political language in using "1992 consensus," and replaced it with the "1992 meeting in Hong Kong." For senior ARATS officials, especially those in the 1992 meeting in Hong Kong, Chen's speech must have caused them to have mixed feelings.

Whether Beijing will decide to respond to Chen's speech may be a crucial factor shaping cross-strait relations. If China responds by expressing its good will, a formal talk between the DPP government and China will be feasible.

On the contrary, if Beijing continues its indifferent attitude, Chen's China policies during his next four years of administration will be futile. It should be interesting to discover whether the Chinese Communist Party will continue to use the "one China" principle to hound Taiwan after President Hu Jintao consolidates his grip on power.

Lee Fu-chung is an assistant professor of Taiwan history at National Chengchi University.

'Offensive' weapons are needed

By Wendell Minnick

Taiwan recently submitted a letter of request for price and availability data to the US Department of Defense for the AGM-88C High Speed Anti-Radiation Missile (HARM) and the GBU-31 Joint Direct Attack Munition (JDAM) for Taiwan's existing inventory of bombs. Such weapons are often characterized as offensive and many believe that this might be a violation of the Taiwan Relations Act (TRA), which restricts the type of weapons sold to Taiwan by the US.

According to a US defense source, the US provision of price and availability data to Taiwan implies approval to release such a weapons system to Taiwan. Fearful of Beijing's reaction, the US National Security Council staff and State Department are expected to oppose the release of these systems. Opponents will argue that the TRA calls for release of weapons of a defensive character, so Taiwan has to argue that JDAM and HARM are inherently defensive.

Despite potential opposition to the sale, the US has sold Taiwan offensive weapons in the past. With the sale of F-16 fighter aircraft to Taiwan in the 1990s the US also sold GBU-12 500-lb Paveway and 2000-lb GBU-10 bombs to Taiwan. In 1999 the US released the AGM-65 Maverick air-to-ground missile to Taiwan. Furthermore, the US government released the software and hardware necessary to convert Taiwan's existing inventory of Harpoons into land-attack cruise missiles. This capability, called Coastal Target Suppression, puts precision GPS receivers onto each missile, allowing it to go after targets in southeast China.

There are three basic reasons why HARM would fit into Taiwan's defense needs. First, it would enable suppression of China's ship-based radar systems and provide Taiwan's future P-3 Orion maritime patrol aircraft more freedom to operate. Without the ability to suppress China's navy air defenses, including the naval version of the HQ-9 missile, Taiwan's P-3s would operate in a very dangerous threat environment.

Second, HARM would enable suppression of Chinese radars that are supporting air strikes against Taiwan. China's air force and navy air operations are highly centralized and dependent upon positive air control for coordination and direction of complex strike missions. This air control relies upon radar data for situational awareness. By disrupting the air controllers' source of information, one disrupts China's ability to conduct strikes against Taiwan.

Third, suppression of enemy air defenses (SEAD) would be necessary to enable Taiwan to conduct strike missions against key nodes of China's conventional ballistic missile forces with minimal losses. Key nodes would include command and control centers, logistical hubs -- going after launchers is not a feasible or cost effective option since there are too many of them. Looking at Second Artillery missile operations as a system, one seeks to neutralize nodes -- assuming one is able to identify them -- that would have a systemic effect. The idea is to go after that node in the most cost effective way possible. HARM would enable suppression of surface-to-air missile systems operating along China's southeast coast.

For example, during the annual military exercise, Hankuang 18, the Taiwan air force, after surviving simulated Chinese air and missile strikes, attempted to conduct a major air campaign against key targets in China, applying about 90 percent of its F-16 fleet. They lost 70 percent of their F-16s to Chinese air defenses. The main reason is the lack of a SEAD capability, including HARM, land attack cruise missiles, airborne Signal Intelligence platforms that could provide operating parameters of radars operating along the coast, airborne jammers, attack helicopters and special operations forces.

For Taiwan, there are two advantages to JDAM. First, Taiwan would reduce the risk of collateral damage by using precision-guided bombs versus dumb bombs. JDAM kits would enable the bombs to hit their targets and not some neighboring village or children's hospital. Secondly, using smart bombs means that Taiwan's pilots, assuming they are able to solve the SEAD problem, would only have to make one pass over a specific target.

A Taiwan government source said that the purchase plan will not affect the Chungshan Institute of Science and Technology's Tien Chien (Sky Sword) 2A anti-radiation missile program, because if it successfully develops it the US will be forced to think about lowering the HARM's price. Procedure for the HARM's budget will be passed during the next legislative session after the year-end legislative elections.

Those in the US government who argue these systems are offensive do not understand Taiwan's defense requirements. Taiwan cannot properly defend itself without these types of munitions. In short, satisfying Taiwan's request for HARM and JDAM is necessary for Taiwan's defense and would not represent a break in US export policy toward Taiwan.

Wendell Minnick is the Taiwan correspondent for Jane's Defence Weekly.