Saturday, January 26, 2008

More Election Analysis & Responses

Analysis of the election continues apace, with more from the Blogosphere, this time from the Only Redhead. I'm tired of arguing with people that I know and love, like Robert, but the fact is that lots and lots of commentators out there fondly imagine that if the DPP had only come up with the right message, it wouldn't have been so bad. But here on Taiwan, at the local level, messages don't matter, it's all about voter mobilization and patron-client networks. The KMT excels at those, and the DPP has not come up with local level tactics to counter them (cash is the sine qua non). The real eff-up, in any case, did not take place in this election, but in 2004, when the DPP blew its one and only chance to gain control of the legislature and rig the system in its favor -- not because it had a lousy message, but because of (what else?) faulty tactics.

The best analysis out there in the Land of Conventional Wisdom is probably that of Jacques deLisle at UPenn. deLisle reports, but does not subscribe to, the CW that the election was a repudiation of Chen Shui-bian, but instead correctly notes the KMT spending advantage and the LDP-type system it is implementing at the local level:

The DPP also suffers from a resource deficit, although this has been closing. The KMT’s once-formidable fortune has withered, and reports indicate that the KMT liquidated assets for the 2008 campaign on a scale that will be hard to replicate. Still, the wealth gap has been significant and, as the party in control of both branches, the KMT would have new fund-raising advantages over a DPP which had lost the presidency and much of its share of parliament.


Still, the 2008 legislative elections, predictions for the presidential election, and longer term patterns and trends in Taiwan’s electoral politics suggest that Taiwan may head for a single-party-dominant system rather than the two-party-dominant system toward which it had seemed to be moving. Taiwan’s democracy then would look more like Japan’s under Liberal Democratic Party hegemony and less like the U.S.’s or Britain’s. That would be a regrettable outcome from a perspective that values democracy in the form of competition among candidates representing a range of views (including those reflecting much of the range of policy preferences and interests in society) who have meaningful chances of victory in contests for offices wielding real power. It would be a particularly problematic outcome for democracy in Taiwan, given the risk that a one-party-dominant system could durably exclude from meaningful influence the large minority of Taiwan voters with clearly “Green” preferences.

For some reason many of the Green-supporting bloggers have decided the DPP lost because it ran a bad election campaign -- alluring logic, but fundamentally wrong. The KMT won, because it vastly outspent the DPP (on the assumption that it can recoup those losses), because of the gerrymandered districts, and because it has the local level systems in place. If the DPP wants to dominate at the local level, it will need to either replicate those KMT advantages or else come up with an analogue. There is, at the moment, no message that the DPP could come out with that could overcome that concrete KMT advantage of disciplined, well-oiled, tightly linked local networks that the KMT has nourished for the last 60 years. Last year I noted this analysis from UBS:

What about the government? Government investment and infrastructure spending has all but ceased as a result of political differences between the ruling and opposition parties. Political disagreements have blocked many government spending programs in the last few years. This year is no different. The budget is currently on hold due to disagreements over how the Central Election Committee will be staffed. Whereas a few years a go the budget deficit exceeded 6% of GDP it has now shrunk to around 1% of GDP. This drop in the government’s need to finance the fiscal balance has contributed significantly to Taiwan’s low interest rate environment. The upcoming parliamentary election in December and the presidential election in March next year could reverse this pressures and lead to higher interest rates in 2009 if the government becomes unified again. However, that is a ways off.

The fall-off in infrastructure spending upon which the local political economy depends has been one of the reasons for the stagnant local incomes, as people who hustled for jobs in public construction saw less of that work during the DPP government -- and blamed the DPP, however unfairly, for that dearth of work. Now that the KMT is back in power, it will need to recoup its expenditures, and to replenish its local networks, on k-rations as the KMT-dominated legislature has starved the local level. The infrastructure spigots are going to be turned back on, local networks are going to re-orient around that single legislator, and Taiwan is going to go back to the future.....

..... and the KMT is going to do even better in the next legislative election -- though no doubt the next set of western-centric bloggers is going to right on blaming the DPP. "Hey, the DPP got crushed again! It must be the DPP's fault. If only that had really really pointed out how bad the legislature was!" Someday the truth about voting behavior in an island that elected Yen Ching-piao while jail for murder, elected legislators on the run from the police, elected Hsu Tai-li as mayor of Keelung while under indictment and replaced him with a convicted vote buyer when he died..... And then there was Wu Tze-yuan, whose followers carried him into the election commission in Pingtung so he could register as a candidate because diabetes left him to ill to walk...Wu had just been sentenced to life for corruption and was running as a KMT candidate against the party's official wishes...and is now in hiding in China.....someday the simple truth that voters pick candidates, in a sense, because they are "corrupt" -- will penetrate. Not this election, though.

I sent off a letter to the Taipei Times but they evidently didn't want it, though they did publish David Pendery's pricelessly asinine letter on the election. In any case, here's my thumbnail analysis of the future from the end of that letter:

What can we expect for the future? This is not the kind of electoral system where the party on the outside can regroup and then stage a comeback in the next election. Thus, the western-centric claim that "this will be good for the DPP" is badly misguided. It will be good neither for the DPP nor for Taiwan. First each legislator is now serving at least twice as many people -- which means they need twice as much cash. Second, studies of Japan show that as one-party dominance of the legislature rises, spending on particularistic services also rises. Both of these observations suggest that corruption in Taiwan's local politics will undoubtedly increase -- if the reader can imagine that. Further, because constituents will only have one legislator rather than several as under the old system, local political and business networks will have no choice but to re-orient themselves around that legislator, since that is who will bring them home the bacon they need to survive. That will only further cement the dominant party's grip on local politics.

In sum, we are looking at the first step in a potential permanent majority -- as KMT heavyweights themselves have hinted with their recent positive remarks on one-party rule in Singapore. How the KMT handles this remains to be seen -- victory may stress the KMT so much that it will fall apart -- but then it has always been an ethnic coalition lashed together by flows of money. And now, again, it has unlimited access to those flows.
What are we going to see? Massive increases in public construction outlays and corresponding rises in government debt (and inflation!) and of course, public corruption. And the remarks about Singapore should be taken to refer to (1) a warning of dominant one-party rule for the foreseeable future and (2) a deliberate campaign of lawsuits against party opponents. Ma is already suing his prosecutors and has threatened the bureaucracy by reminding them that the DPP will not be in power forever and revenge will come; a blogger got sued for satirizing a politician.....the KMT contemplated this strategy before, in the 1980s, and experimented with it in the past. Remember, as KMT politician Hsu Shui-de publicly claimed: the courts belong to the KMT, and tremble....


Ben said...

Thanks very much for the analysis. Fascinating and depressingly convincing. A lot has clicked into place reading your election posts.
But does any of this apply to the presidential elections? Surely the DPP can maintain sustainable competitiveness for the presidency?
Can they?

Anonymous said...

More political commentary from foreigners about Taiwan's recent election. As usual, most of it centers on the prevailing outsider's views about the need for infrastructure reform. Why don't we hear massive yelling from the Taiwanese? Surely, at least some of them read this blog.

Raj said...

Michael, why do you keep saying the KMT gerrymandered the districts when both the CEC and DPP agreed with most of the boundaries in negotiation sessions? The relative few that were decided by ballot were reasonably evenly distributed between the parties in the legislative.

You seem to be suggesting that the DPP and CEC agreed to gerrymandering.

Robert said...

Michael, I know it must be frustrating to be you (and I'm not being sarcastic). I appreciate all of your analysis and taking the time to lay it out as you have.

It certainly keeps me thinking. This is exactly why I write.


阿旭 said...

hey, was just reading a letter in the taipeitimes which sounded said exactly what you've been saying over the last couple of weeks...i scrolled down and it was your letter. Apparently they finally accepted it.


STOP Ma said...

Until corruption, black gold, and the like is looked upon as a disease affecting the long-term interests of Taiwanese citizens -- nothing will change. Unfortunately, this type of mature foresight is lacking in Taiwanese society at the moment.

As Michael points out, 2004 was a watershed moment for the possibility of this short-sighted cultural phenomenon to change in Taiwanese politics and society. Sadly, history extinguished that possibility.

This cultural shift in priorities is an extremely challenging problem for any party who wants to lift Taiwan out of the dark-ages of politics. This change has to be orchestrated at so many different levels. I personally find it difficult to see how this will ever be done in Taiwan.

STOP Ma said...

Congratulations on getting published in the Taipei Times, Michael!

As an additional thought -- I remember talking to some of my "international" co-workers last week about corruption in politics at the local level. Their native countries were Burma, Sri Lanka and China. All of them recognized that local corruption was systemic in each of their former homelands. But they all have this nostalgic sense about living there under those conditions. When I mentioned Taiwan and how I was sad to find out that the Taiwanese had chosen to embrace the past once again, they tried to convince me that this system is just as good as any. At that point I remember my Chinese co-worker trying to explain to me that this particular kind of localized politics is actually an "efficient" and "practical" system.

These are well-educated individuals who have lived in the mature democratic and prosperous country of Canada for over 4 years -- and they still feel this way!

My pessimism for Taiwan was somewhat heightened that day.

Anonymous said...

It is misleading to say that the DPP agreed with all of the legislative election reforms. They wanted referendum voting to become a part of the electoral process, and they wanted the party vote, so they put up with the redistricting and the small single legislator districts.

It turns out, referendums under the current system are dead (goddamn shame--Taiwan really needs to debate, then vote on nuclear power/energy policy, and the Su-Hua Freeway). Everyone pretty much also agrees that the absolute number of legislators is too little and that many more (perhaps doubling) seats should be allocated to the party vote.

In any case, the reality of actual election results changes how the theoretical consitutional changes are viewed. No one thought how bad ly the legislature would reflect the proportion of votes. Now everyone knows and is talking abou t it. Hopefully something will be done.

One more thing--Michael, I have to say that I think one of the biggest coups of KMT propaganda has been to say how bad the economy has been doing. Even Greens accept this line without much thinking, and justify their support for the DPP on other grounds. I think in Taiwanese society there is a segment of the population that needs help adjusting to the globalized economy. However, I think 90% of the problem with the economy has been perception.

Yes, there are a lot of things the gov't can and should be doing better, but on the other hand, Taiwan has always competed and grown well even with these bad rules in place. You can only do so much at one time, and I think a sense of crisis is good, but being pessimistic flying entirely counter to cold hard facts of a healthy, vibrant Taiwanese economy hurts the economy real bad in terms of people's willingness to invest, people's willingness to spend, etc.

So, my summary--the KMT won, not because of an appealing (though deceptive) message, but because they also had in accomplice much of the media in Taiwan, which has always been pro-Blue, but found that the economy issue was one in which they could hit at the DPP and still resonate with their viewers (i.e. not be outed as the liars they are). I believe that this past election, the economy issue was huge, even though it's a fake issue.

Some food for thought:
- Since 2001, the rate of jobless has been steadily decreasing
- Income tax revenue has been increasing (note that rich people make almost all of their money from capital gains which isn't taxed)

Let me point out all the retarded statistics on starting salaries of college students never accounts for the fact that 1) there are tons more college students 2) never bothers to ask what people are making 5 years after college instead of just starting salary 3) never includes bonuses and stocks, which in Taiwan is the norm, not the exception, unlike in other countries 4) never thinks about how many people own businesses (Small Medium Enterprise heavy Taiwan, this is around 15% of the country... yes, really, 15%... how are they doing? does anyone bother asking?)

Remaining problems:
- Remaining government owned enterprises really need to be privatized (Taiwan Railway Administration, China Petroleum Company, ...)
- Tax reform (lowering estate tax, getting rid of the fuel tax, increasing gasoline tax)
- Higher Education: either privatization of some universities or universities can start setting their own tuitions and upgrading/recruiting students/professors as they see fit
- Stop subsidizing water, gas, electricity

Thomas said...

On the economy, we may be heading for a slight global slow-down. If the US heads into recession, American consumers will buy fewer Taiwanese products. This may lower Taiwan's GDP in a way that cross-strait links and infrastructure projects cannot compensate. It would be interesting to see the public's reaction to a declining GDP under a newly elected KMT administration that campaigned largely on the economy. The economy is doing well now. It might not be as great in a year or so. Just food for thought.

Anonymous said...

Yes, economic growth of 5.46% is quite good.