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KMT is dead on MAY 7 - 12 ……
On May 9, 2004 ……
The KMT party-state is dead: Lee
LAST LEGS: The former president said the current leadership of the KMT was the last residue of the bad old days and that it would survive only a few months
By Chang Yun-ping, STAFF REPORTER , IN TAICHUNG
With the re-election of President Chen Shui-bian, the Chinese Nationalist Party's (KMT) party-state edifice had collapsed, allowing the shadow cast upon Taiwan by the Chinese civil war to finally lift, former president Lee Teng-hui said yesterday.
"The cancellation of the
Temporary Provisions Effective During the Period of Communist Rebellion in 1991
signified that Taiwan no longer treated the People's Republic of China as a
rebellious entity," Lee said. "But Taiwan didn't walk out of the
shadow of the civil war until the March 20 election, when the KMT's party-state
came to an end."
Lee was speaking at a seminar organized by the Taiwan Advocates think tank at Chunghsing University. Around 1,500 people packed the school's auditorium to hear the last of three seminars attended by Lee discussing the ramifications of the presidential election on the country's legal system and democracy as a whole.
Lee said that although the "Peace Revolution," or the process of peaceful democratization Lee advanced during his 12-year presidency, had contributed to the gradual erosion of the party-state structure, there remained a residue of that edifice, namely the people who were in power at that time and who remained powerful now.
"The post-election instability represents the final struggle of these party-state remnants to survive," Lee said.
However, Lee assured the audience that the battle for political survival by KMT Chairman Lien Chan and People First Party (PFP) Chairman James Soong would not last much longer -- probably "a few months."
Lee also criticized the recently formed "Democratic Action Alliance", which includes prominent film director Hou Hsiao-hsien and veteran political commentator Nan Fang-shuo. The alliance accuses Chen of using populist methods to instigate ethnic confrontation and warns of impending tyranny.
"Some people use the slogan of `new democracy' to smear Taiwan's existing democracy and vilify this new majority leader as a populist," he said. "They lay claim to the only objective and truly democratic position, but this does not stand up to scrutiny in a democracy. I believe the Taiwanese people, who have experienced democracy, won't be manipulated by these politicians."
Lee said the election showed that Taiwanese identity had emerged as a mainstream mode of thought, and based on this consensus, he urged the public to help bring about a solid majority for those who identify in this way in December's legislative elections, bolster the process of referendum and support the rewriting of the Constitution.
Political commentator Chin Heng-wei, also speaking at the seminar, said Chen's re-election meant that Taiwan had emerged as a successful and unique model for the third wave of democratization.
He said that the nation had successfully prevented an ancien regime from staging a counterattack, while many other new democratic countries, such as those in eastern Europe, had failed to do so.
Ruan Ming, a visiting professor at Tamkang University, said the election failure of Lien and Soong did not result from ethnic disputes between Hoklo people (commonly known as Taiwanese) and Mainlanders; rather, it was because Lien and Soong had taken the wrong direction in their campaign by not recognizing the significance of Taiwanese identity.
Yao Jen-to, an assistant professor of sociology at National Tsinghua University who specializes in media criticism, yesterday said the presidential election was a triumph for Taiwanese people because they had prevented the pro-blue campmedia from deciding the presidential election.
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On May 9, 2004 ……
Ah, but who made it so hard to vote?
`In most democratic countries, this problem would never have arisen because there are procedures in place for absentee voting, and for changing one's registered residence for voting.'
By Dave Lindorff
As the battle over the razor-thin re-election won by President Chen Shui-bian continues, there is at least one grand irony in the charges being leveled by the losers, the pan-blue alliance.
The pan-blues have, among other things, charged that Taiwanese soldiers were prevented from voting because of a heightened state of alert ordered by the government on the afternoon of March 19, following the shooting of Chen and Vice President Annette Lu.
While there is an ongoing debate over whether more than a few thousand additional troops were kept on base and prevented from returning home to vote, the issue is controversial because the Chen/Lu ticket won by fewer than 30,000 votes. The pan-blue camp also charges that many soldiers were kept on base deliberately to keep them from voting, and that most soldiers would have voted for the pan-blue ticket.
One may dispute how many additional troops were actually prevented from voting because the heightened alert, and what percentage of those disenfranchised soldiers and sailors would have voted for the Chinese Nationalist Party (KMT)-People First Party (PFP) ticket, and even whether the heightened alert was justified or not. What has not been mentioned in all this debating, however, is the question of why soldiers on duty in Taiwan on an election day are prevented from voting in the first place.
In most democratic countries, this problem would never have arisen because there are procedures in place for absentee voting, and for changing one's registered residence for voting.
In the US, for instance, every state has a mail-in ballot option to make it easy for people who are traveling for work or school, are handicapped or hospitalized, or simply are at work while the polls are open, to cast a vote.
The procedure is simple: A qualified voter simply requests a ballot in writing from his county voter registrar. After the request is checked to make sure the requester is duly registered to vote, a ballot is mailed, along with two envelopes. The voter fills out the ballot, which is put into an unmarked envelope to maintain anonymity, and that envelope, which is opened and counted on election day, is mailed in the second larger envelope, which has the voter's identification, to be logged into the system to prevent the person from voting twice.
It is also easy in many democratic countries for citizens to transfer their voting registration from one jurisdiction to another with the signing of a form.
Students, for example, can easily register to vote in the town where they go to college, and soldiers can re-register in the town where they are stationed, so they don't have to rush home to vote on election day.
If Taiwan had such a system, many more people, including soldiers and citizens working, studying or traveling overseas, would be able to vote.
Certainly there are arguments against absentee ballots. In a society where vote-buying is still a problem, mail-in ballots could facilitate the process by making it easier for the vote-buyer to ensure that the voters he bribes actually cast their votes the way he wants. Still, the benefits of making voting easier should outweigh corruption.
The irony in all this is that the election law that bars absentee balloting and that makes it so difficult for Taiwanese voters, including soldiers, to re-register in the place they are currently living, was passed way back in 1995 by -- guess who? -- "the then-ruling KMT [which at that time included the PFP]. So the people who are now crying foul really have only themselves to blame.
Actually, I suspect that the KMT, which tends to be supported more among the business class and the more well-off in Taiwanese society, probably likes things this way. It is likely that the vast majority of those several hundred thousand voters who had enough money and free time to fly all the way to Taiwan from abroad just in order to cast their votes were pro-pan blue.
If those who had less money and time for such a trip -- overseas students, for example -- had been able to vote by mail, the pan blue overseas advantage probably would have been considerably less.
Dave Lindorff is a Fulbright senior scholar in residence at National
Sun Yat-sen University.
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On May 9, 2004 ……
Freedom of speech does not mean lawlessness
By Chen Lung-chu
The competition during the election campaign was the fiercest in Taiwan's election history. The chaos during the campaign was also unprecedented.
Specious statements were disseminated both domestically and internationally in attempts to influence the election, and politicians used freedom of speech as an excuse to have the media spread information aimed at slandering their opponents. The mass media's unrestricted dissemination of politicians' undisciplined behavior led to immeasurable social damage, affected public order and halted the development of social fairness and justness.
Democratic societies are particular about the freedom of speech, and encouraging everyone to express their different ideas is a phenomenon particular to diversified societies. Democratic societies, however, are not societies where one can do whatever irresponsible thing one pleases -- we all have to take responsibility for our actions.
In other words, without verifying facts, politicians may not arbitrarily challenge the integrity and morals of others and use the ubiquitous media apparatus to slander opponents and destroy their reputation, claiming that they are doing so to reveal a malpractice. Evidence in support of the truth may then begin to appear, proving that the target has been the victim of slander. But even though the truth then is clear for all to see, the damage has already been done because the untruths have been so widely disseminated.
Advanced societies should possess mature soul-searching capabilities and be restricted by legal and moral standards.
We have all seen the chaos following in the wake of the presidential election. Politicians doing their utmost to slander and humiliate their opponents obviously provide negative examples for social education in Taiwan. If we are incapable of standing up against their disorderly behavior, then Taiwan will see the disappearance of justice and the further spread of social confusion and unease.
Chen Lung-chu is the chairman of the Taiwan New Century Foundation.
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On May 9, 2004 ……
Taiwan, China can learn from Europe Day
By C. V.Chen
Today is Europe Day, and I have very mixed feelings towards a day with a name like that. For Chinese people in particular, the name "Europe" evokes simultaneous feelings of hate and love, fear and respect.
The fear and hate part derives from the merciless bombardment from European gunboats that shook China, an ancient civilization spanning 5 millennia, from a thousand-year mentality of confidence and superiority in which it had believed itself "situated in the center of the earth, surrounded by barbarian states," almost overnight. This also brought along a century of uprisings and calamities, a period of history painful to look back on.
The love and respect part has the same root. Merciless as the gunboat policy was on the surface, it sowed the seeds for the development of an integrated system in China. Democracy, rule of law, human rights and freedom all come from the kernels of civilization within this system: They did not exist in the traditional Chinese political system, which cared little for them. After a century of unrest, these seeds have gradually began to flourish among the Chinese. In Taiwan, these elements of civilization have already grown into a robust tree, protecting the freedom and peace of the Taiwanese people with its shade. Although these same elements are just barely breaking through the soil in China and are still in the initial stages of growth, they show promise of growing to be vigorous and strong, assuring the Chinese of happier days ahead.
In recent generations, in order to eradicate the encroachment and destruction visited on us by the imperialism of a century ago, Europe has played a major role in promoting the advance of a modern, integrated human civilization. Even more admirable is the fact that Europe is still the main proponent of this cause even today. The EU is a measure of the achievement of this drive. It has been drawing up the blueprint for a better world transcending national borders in which everyone works as one towards happiness.
On May 9, 1950, then French foreign minister Robert Schuman announced the Schuman Declaration, calling on European countries, and in particular France and Germany, to pool their capabilities in producing their major strategic resources, coal and steel. The call was received very favorably and in the following year, under the co-operation of France and Germany, the European Coal and Steel Community was established, the precursor of today's EU.
Since May 1 the EU has taken in ten more member states, including some former communist Eastern European and Mediterranean countries. This brings the total amount of members to 25, making it a new politico-economic body with a population of 450 million. This was not only a great day for Europe, but promises unlimited new possibilities for the whole world. It makes possible the abolition of national, cultural, linguistic and religious barriers using peaceful and co-operative means, as well as the consolidation of the global community.
This level of success with integration was hardly imaginable before. Ever since the eruption of the Franco-Prussian War in 1870, France and Germany have erected fences of hate between them. For many decades afterwards, this enmity between the two countries was the fuse setting off large-scale wars in both Europe and the rest of the world. Each conflict deepened the hatred. It took the bloody lessons of two world wars for the politicians and peoples of the two countries to realize that the borders between them could only result in further accumulation of hate that would end in calamity for the people of not only France and Germany, but of Europe as a whole.
The only path to peace was to destroy the fences erected between them and to unite in a common cause. Once they realized this, the two countries made a dramatic transition from being deadly enemies to becoming allies, and then from allies to members of a family.
Putting aside their enmity, they started moving towards integration, laying the foundations for a robust peace and stability in Europe. In order to commemorate this impressive and valuable achievement the leaders of the European Community, the precursor to the EU, decided during the 1985 summit in Milan, to name May 9 every year as Europe Day.
This shows how different the Europe of today is from that of a century ago. Despite the fact that the Europe of 100 years ago did bring some kind of systematized civilization to the world, they employed imperialistic tactics, bringing much suffering and chaos to other countries. As a result, our love is tinged with reproach, and our respect accompanied by fear. The Europe of today has been elevated to the status of a "pioneer of integration", bringing enlightenment to humanity with wisdom and magnanimity, conducting an experiment of a common system transcending national boundaries for the globalized modern world.
One would hope that the success of the EU will inspire a new wave of integration all over the world. It is because of this that we should have nothing but respect and love for modern Europe, and can leave hate and fear behind us.
The success witnessed in Europe should be admired and learned from when looking at cross-strait relations today. Hate can only lead to more hate, and goodwill must create more goodwill. Following the Franco-Prussian War, both France and Germany embarked on strengthening their military capabilities on the assumption that this would ensure national security. On the contrary, however, these measures only built the ramparts of hate even higher, and the atmosphere of confrontation and anxiety lead to war after war.
The logic employed then is almost identical to that informing the policies of the leaders on each side of the Taiwan Strait: China is not abandoning its military threat, and Taiwan is ploughing the huge sum of NT$200 billion annually into its national defense budget, hoping that this will guarantee national security.
In truth, this logic will result in the opposite of the intended outcome. Could it be that the lessons learned at France and Germany's cost have not been learned well enough? Why are we moving along the same ill-fated route in the cross-straits situation?
Nowadays, Germany and France are no longer stuck in the quagmire of mutual escalation of aggression, and resources formerly earmarked for protecting themselves against each other or for financing aggression have been diverted to promoting welfare. What's more, in this process of mutual co-operation they have deepened the compassion and trust between them, removing the soil which nourished the roots of war.
This is the greatest insurance for national security. Why is this hugely successful turnaround, in which co-operation has dissolved mutual enmity, invisible to the governments and peoples either side of the Strait?
The shared destiny and linked fortunes of these countries are the products of an irreversible process, and the only way forward is for them to stand united and rely on each other. All it requires is for the leaders and people of the two sides of the straits to learn from the wisdom and foresight of the people of Europe what Europe Day represents. Then perhaps we could embark on a road that would benefit the people on either side of the Strait.
C. V. Chen is chairman of the Taipei European School Foundation.
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On May 9, 2004 ……
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On May 10, 2004 ……
The myth of the 'apolitical' WTO
By Johnny Chiang
Last year, China pressured the WTO secretariat to change Taiwan's title used in the directory from a "permanent mission" to an "office of permanent representative" so the title does not imply sovereignty.
This year, after China started a number of bilateral consultations with the US on the application of value-added tax on imported semiconductors, Beijing again notified other related member states that due to its problem with the title, China refused to have Taiwan participate as a third country. This once again politicized economic issues and made the WTO another battlefield in the cross-strait controversy.
Given this, is it possible for the WTO to serve as an alternative channel through which China and Taiwan can communicate and negotiate, thus resolving their political impasse?
We initially hoped so. Yet reality does not seem to be as simple as we had wished.
When both countries were acceded to the WTO almost simultaneously two years ago, it was widely believed that the standardized and legalized regulations of this multilateral organization would reduce political disputes. It was therefore hoped that Beijing and Taipei, with a closer economic and trade relationship upon their accession to the organization, would be able to resolve their political standoff and initiate new and benign political interactions.
Unfortunately, the political disputes across the Taiwan Strait so far have not diminished within the WTO mechanism. On the contrary, Taiwan's disputed sovereignty has led to negative interactions on such issues as Taiwan's representative office title, rights and status.
In terms of status, for instance, China said immediately after Taiwan's accession to the WTO that the cross-strait trade relationship cannot develop unless it is within a one-China context, and that the relationship should be viewed as China's trade relations within its own single-tariff area.
Beijing obviously wanted to downgrade Taiwan's status to something like that of Hong Kong and Macau. It also declared that economic cooperation across the Taiwan Strait is part of its domestic affairs and should be based on the one-China principle, and thus the WTO's involvement in the process is not necessary. China also denied Taiwan the rights to sign government procurement and free-trade agreements with other economies under the WTO framework.
China often deliberately changes the name of Taiwan's representation in Geneva from "Taiwan, Penghu, Kinmen and Matsu," or Chinese Taipei for short, to "Taipei, China." This attempts to obscure and dwarf Taiwan's WTO status and make it a subordinate tariff region like "Hong Kong, China."
Beijing also requested that the WTO refuse to review Taiwan's legal documents in which official names denoting its sovereignty such as the Republic of China, the Executive Yuan and the Legislative Yuan were used. China claimed that the use of such terms violates WTO regulations as well as a 1992 General Agreement on Tariffs and Trade Council chairperson's statement.
Will the WTO interactions between Beijing and Taipei ever return to basic trade and economics? This appears unlikely.
The WTO, inheriting the spirit of the Havana Charter, does not regulate, judge or intervene in political affairs. The organization even manages to reduce the impact of sovereignty-related issues. What has happened between China and Taiwan politically in the WTO so far shows that although this economic United Nations does not handle political and sovereignty-related issues, it does allow China room for its political maneuvers.
While abiding by the GATT/WTO regulations on economic issues, Beijing fully exploits the room left for political manipulation under the WTO. It looks down on Taiwan as its subordinate and avoids any WTO interactions with Taipei on an equal basis. China uses the WTO's vague regulations to further politicize, internalize and particularize the cross-strait relationship.
For the foreseeable future, China will continue to uphold the one-China principle and exploit its economic capabilities and available political space under the WTO to engulf Taiwan.
Taiwan should no longer regard the organization as merely an international trade group and neglect the available political space within it. Otherwise, China's deliberate maneuvers will ensure that Taiwan faces more political problems in the WTO.
Johnny Chiang is an assistant political science professor at Soochow
University.
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On May 11, 2004 ……
Buildings Taiwan-EU relationships
By Chen Lung-chu
The international political influence of the EU is second only to that of the US. With the 10 Central and Eastern European states that joined the EU on May 1, the organization now includes 25 member nations and represents 450 million people. This has greatly increased the EU's international influence. The EU is Taiwan's third largest trading partner, and the trade relationship was further strengthened with the establishment of the European Economic and Trade Office in Taiwan on March 10 last year.
In response to the political and economic benefits resulting from the EU's eastward expansion, Taiwan should make good use of the existing trade cooperation mechanism to further develop our relationship with the EU in general and the new member states in particular.
The government has already formulated a policy to deepen and widen the bilateral Taiwan-EU relationship. Given the current international political environment, Taiwan has to direct further efforts towards creating a breakthrough in unofficial exchanges with the EU and to establish normal diplomatic relations with each member state. There is still a lot of room for Taiwan and the EU to further develop mutual cooperation, in particular in the field of the protection of human rights.
Most EU countries are old democracies that pay great attention to the implementation of universal values such as democracy, freedom and the protection of human rights. This coincides with President Chen Shui-bian's concept of a "human rights-oriented nation." The EU's rich experience in the implementation and protection of human rights can serve as a reference for Taiwan's implementation of the "human-rights oriented nation" concept. It can also provide an important channel when Taiwan wants to join international non-governmental human rights organizations.
The European Commission is a supra-national organization, and the EU's main executive institution. The European Commission has directorates-general on international relations, economic and financial affairs, agriculture, fisheries, energy and transport, employment and social affairs, research, education and culture, and justice and home affairs. These institutions have all achieved quite important political results. Taiwan could invite officials from these specialized areas to exchange development experiences, strengthen knowledge about Taiwan among specialized EU officials and advance mechanisms and opportunities for mutual functional cooperation.
Taiwan stresses social mechanisms for the protection of human rights, a liberal democratic system and a diversified, free economic system. These ideals coincide with the basic values of the EU's member states. Taiwan and the EU can continue to expand channels for cooperation based on pragmatism and mutual benefits in areas such as trade exchanges, research and development, protection of human rights, environmental protection and even culture and education, in order to increase the wealth for the peoples on both sides and to promote a prosperous and developing bilateral relationship.
Chen Lung-chu is the chairman of the Taiwan New Century Foundation.
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On May 11, 2004 ……
Chinese investments prove risky
By the Liberty Times editorial
In recent days, many people in China and abroad have voiced concerns that the large number of blind investments and repetitive development projects within China will necessarily create serious production problems and wasteful facilities.
They also believe that this problem will result in economic and investment growth rates declining massively, causing the momentum of economic growth to vaporize entirely.
Facing such a crisis, the Chinese government has taken the initiative in declaring a comprehensive adjustment of the situation, so as to hit the brakes to slow down investment.
However, it is no easy task to decrease excessive investment in a calm and orderly manner. This policy could very well cause a drastic decline across the entire economy, referred to as a "hard landing."
Therefore, when high-ranking Chinese officials indicated an intention to adopt measures to forcibly cool off Chinese economy, the stock markets of Taiwan and other Asian countries endured significant declines. Some such drops were real, while others were caused by the erroneous beliefs of our countrymen.
Some of these downturns came from the reliance of Taiwan's manufacturers on the Chinese market. Currently 36 percent of Taiwan's total exports go to Hong Kong and China. In addition, on average each year 4 percent of Taiwan's GNP is invested in China. Each year 4 million visits are made by Taiwanese to China.
Taiwan's level of dependence on China is far higher than that on other countries.
In terms of individual industries or manufacturers, the level of reliance may far exceed the above-described reliance at the national level.
In the past, our countrymen have ignored cautions about the need for risk diversification and the possibility of great fluctuations in China's economy and official policies. Those who believed in the lie about "boldly going west" are now paying a hefty price. We hope that this experience will encourage caution about the Chinese market's risks.
In addition to losses resulting from a market decline, these manufacturers may also suffer losses resulting from lost expectations. Many people in Taiwan have been blindly optimistic about the Chinese market. Therefore, they invest large sums of capital in China. Stock investors also purchase the so-called stocks of China-related firms with high prices. When the Chinese economy begins to rapidly cool off, some investors naturally cannot avoid suffering serious unexpected losses.
In fact, many businesses may become trapped in some very difficult situations. Facing losses created by such erroneous appraisals of China, in the future everyone must come to a more objective understanding of China's economic development potential and no longer be misled by all those excessively optimistic reports.
Besides these losses crashes, the tightening Chinese economy has led to some illusory conflicts regarding Taiwan as well.
Because some of our countrymen exaggerate the importance of the Chinese economy to the world economy and to Taiwan's economy, some economic conflicts come about due to psychological factors. Many people treat Taiwan's exports to China as China's contributions to Taiwan's economy.
Therefore, when the Chinese economy turns bad and such excessive exports decrease, they think that our economy will suffer major harm. Such mentalities are reflected in the decline of the stock market. But Taiwan's exports to and trade with China are not contributions by China to our economy. Therefore, decreases in these investments will not result in that much injury to Taiwan's economy.
Most of Taiwan's exports to China were exports that Taiwan was making to other countries anyway. The exports were simply shifted to China. A typical situation is when Taiwanese businesspeople move production of goods in Taiwan to China, where they then export the goods but still have Taiwan supply the materials and facilities. Therefore Taiwan's exports increase, while exports to other countries decrease and China's exports to other countries climb.
Anyone who understands how this works realizes that the increase of exports to China was no blessing from China to us. Instead, it is the result of China taking away much of Taiwan's industry. Therefore, the cooling-off of the Chinese economy, which should slow down the pace of industrial relocation to China from Taiwan, is not necessarily a bad thing for Taiwan.
China plans to cool off its economy because it hopes to decrease the number of blind and excessive investments. Many such investments originated from blindly optimistic Taiwanese businessmen. The cooling-off of China's economy will also decrease the chances of erroneous investments on the part of such Taiwanese businessmen. Generally speaking, in terms of the waste from such investments that may be reduced, ultimately this is good for Taiwan.
As for businesses that are already in China, if they are in excessively invested or speculative industries, they face grave business risks to begin with. Even if China does not adopt a policy of cooling-off its economy, these industries will sooner or later have problems.
As for other investments, they may benefit from the eased competition due to the slowing of new entrants into these industries. This is true especially since the demand of export industries is not only unimpacted, but may enjoy less risk from cost increases and currency appreciation as a result of the new policy.
Based on the above, the cooling-off measures of China hold no apparent damaging impacts for Taiwan's economy and Taiwanese businessmen.
However, when those in Taiwan who see China's economy as a development miracle or China as the only place in the entire world where there are chances for development see how the Chinese economy grows or declines, they will naturally think that not only Taiwan but even the entire world will be impacted.
The cooling-off measures of China are actually a chance for Taiwan's economic development. In the past few years, many Taiwanese businessmen have come to understand that investing in China is not as profitable as they had hoped. The competitiveness built on utilization of cheap Chinese labor has caused excessive production and price declines. Therefore many Taiwanese businessmen are thinking about returning to Taiwan to upgrade their businesses.
The cooling-off of China's economy may decrease willingness by manufacturers to invest in China due to their overly optimistic appraisal about the development potential or competitiveness of China.
Therefore the government should actively assist these manufacturers in upgrading their investments in Taiwan, and in investing in other countries, so as to reap the benefits of market and investment diversification. As for the land, manpower and legal environment needed, the government should overcome all obstacles to meet such demands as soon as possible.
The Legislative Yuan should also approve the government's plan to increase public construction projects and improve the investment environment so as to make business enterprises keep their roots in Taiwan and make contributions here.
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On May 10, 2004 ……
Can China protect its workers?
By John Fabian Witt
After a massive gas well explosion killed 243 people in southwest China last December, the State Council and National People's Congress have announced new rules for industrial safety. The authorities' response follows a familiar pattern: high-profile pronouncements in the wake of disaster give way to neglect of basic safety standards. But if Western experience is any guide, ad hoc responses to high rates of work accidents won't reduce the risks to Chinese workers. Only the development of basic legal institutions will help make Chinese workplaces safer.
China and other developing Asian economies are experiencing an industrial accident crisis of world-historical proportions. Official sources report 14,675 industrial-accident deaths in China last year, but statistics on workplace accidents are notoriously unreliable, and some observers suggest that the number may be closer to 120,000.
China's coalmines are among the most dangerous places to work in the world. Chinese garment factories have repeatedly experienced disasters on a par with the infamous Triangle Shirtwaist fire in New York City a century ago, which killed 146 workers, all young women.
Conditions may well get worse before they get better. Even though China instituted new initiatives in industrial safety at the beginning of last year, official estimates indicate that industrial accident deaths increased by almost 10 percent last year.
Yet as the example of the Triangle fire suggests, the China's experience is not unprecedented. Until the recent Asian accident crisis, the poorest workplace safety record in world history belonged to the US in the 50 years following the American Civil War.
Coalmines in Pennsylvania in the 1860s -- where 6 percent of the workers were killed each year, 6 percent crippled, and another 6 percent temporarily disabled -- looked very much like the mines now operating in Shaanxi Province. Industry-wide, one American worker in 50 at the turn of the last century was killed or seriously disabled each year in work-related accidents. Accidents were the leading cause of death among workers in dozens of hazardous industries.
Of course, American industry is still plagued by serious safety problems. But seen from a historical perspective, there has been a striking decline in work-related injuries and deaths in the US. There were 30,000 annual work-related fatalities a century ago; today, the annual average is around 5,000, even as the population has tripled.
What explains this huge improvement in occupational safety in the US? Increased union membership in the mid-20th century clearly helped, as workers bargained and lobbied for improved working conditions. In recent decades, some of the most dangerous work has been shipped overseas (ironically, much of it to China). And as Americans have grown wealthier, they have been willing to spend more on safety.
But the deeper historical reasons for improved workplace safety lie in an array of legal institutions developed by workers, employers, lawyers and lawmakers at the end of the 19th and beginning of the 20th centuries. American workers' organizations, for example, developed insurance benefits for their members and sought to exercise collective control to improve workplace safety. American lawyers developed modern accident law that created remedies against negligent employers.
Most importantly, drawing on reforms first implemented in Germany, England, and France, workers' compensation statutes provided compensation for injured workers and created powerful incentives for employers to reduce accident tolls. In the 1910s, American workplace injuries began to fall in virtually every industry, except coal mining (where injury rates remained high for several decades).
Each of these innovations helped create an institutional infrastructure capable of dealing with the problem of work accidents -- and, indeed, with the wider social problems of disability, sickness, old age, and unemployment.
Why? Because workplace safety and industrial accident compensation turned out to be critical early tests of Western legal systems' administrative capacity to deal with the systemic problems of industrial free-market societies.
Of course, what worked for the US may not work for China. There are many different ways that legal systems can respond to occupational safety problems. The US, for example, never developed a powerful body of factory inspectors capable of providing effective enforcement of public safety standards. Other Western states, such as Germany, have successfully relied on centralized regulation and social insurance systems ever since Otto Bismarck reformed the German law of accidents in the 1880s.
China is obstructing all available paths to improved workplace safety. National safety standards and inspection regimes reflect the underlying pathologies of the Chinese state, in which lower-ranking officials report only positive information up the bureaucratic food chain. At the same time, limits on workers' ability to organize independent unions have inhibited grassroots forms of safety monitoring. Even Chinese media have come under fire for uncovering the kinds of workplace hazards that US journalists revealed a century ago.
Lawsuits are apparently increasingly common, but they are notoriously cumbersome, and judges are not independent from factory bosses. Compensation awards to injured workers and their families are pitifully low and fail to give employers incentives to make their workplaces safe.
The lesson of the US and European experiences is that improving workplace safety depends on the development of basic rule-of-law standards in courts, workplaces and administrative bureaucracies. Edicts and exhortations from the State Council are all well and good. But only effective legal institutions, not Chinese Communist Party fiat, will reduce Chinese workers' risk of death or injury on the job.
John Fabian Witt is an associate law professor at Columbia University and author of The Accidental Republic: Crippled Workingmen, Destitute Widows, and the Remaking of American Law.
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On May 12, 2004 ……
Investors learn China isn't a land of promise
By Chen Po-chih
China recently announced a push for "macroeconomic control measures", as Premier Wen Jiabao vowed to take "effective and very forceful measures" to resolve China's economic problems. The world generally believes this will seriously affect Taiwan's economy.
Many people think that China's development has greatly contributed to the world's economic development, but the fact is that the whole world has considerably contributed to the Chinese economy. Since Taiwan and Hong Kong have close economic relationships with China, the macroeconomic control measures will surely affect these two places the most. In fact, we must understand that Taiwan's export volume and surplus with China were not created by the latter. Instead, they were created by Taiwanese industries operating in China. In other words, the increase in our export volume and surplus with China has come in exchange for the decrease in that with the world. The increase is not a Chinese contribution to Taiwan, but a Taiwanese contribution to China. This is actually a result of China stealing Taiwan's industries.
Figures show that Taiwan's exports to China and Hong Kong account for 36 percent of its total exports at present. Four percent of Taiwan's GDP has been invested in China, and Taiwanese tourists visit China 4 million times per year. In the past, many people ignored the crises of drastic economic fluctuations and policy changes in China. Now that they have suffered losses, people may pay more attention to the high risks of the Chinese market. In addition to these risks, what is most serious is Taiwanese businesspeople's wishful thinking and their blind expectations. Yet the cooling down of China's economy at the moment may not really hurt Taiwanese investors. A more miserable situation will occur if Beijing does not carry out this policy, and its economic problems become worse.
If a bubble economy occurs in China, the recovery will take a long time. Therefore, to implement the control effectively, Beijing will inevitably be overzealous in correcting its mistakes. The degree of control may be as severe as monitoring every single credit transaction. Once the Chinese government suppresses the growth of certain industries, it will affect other businesses peripheral to those industries. Still, despite the fact that attempting such control is highly risky, there is a greater danger if Beijing just sits back and does nothing.
What is more worrisome is whether or not the macroeconomic control leads to a hard landing. Will Taiwanese businesspeople suffering from this policy transfer the damage to Taiwan? Lured by the rapidly growing Chinese economy, many Taiwanese businessespeople have forgotten the various opportunities for development in Taiwan. The government should seize this chance to help domestic companies upgrade themselves. It should also expand infrastructure and improve the investment environment, so as to keep the roots of local businesses in Taiwan.
From another perspective, there is one more purpose to China's macroeconomic control: to reduce the pressure on the Chinese yuan to appreciate. Once China's economic growth declines, the Chinese government will have a good reason to prevent the appreciation of the yuan. This is positive news for the New Taiwan dollar and other Asian currencies.
Many people used to mistakenly believe that China's economic development was superb, and that they could profit from business in China. For example, "China-concept shares" were unstoppable in Taiwan's stock market, while local businesses were often overlooked. The implementation of macroeconomic controls by Beijing should serve to destroy this myth.
Chen Po-chih is the chairman of the Taiwan Thinktank.
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