Polls and Budgets and Gravel

The Central News Agency has a nice bit of reporting out on the Hsieh-Ma debate. Among the local news organizations its reporting is generally the most balanced. The first half of the article offers a report on the polls:

Ratings released by two major local dailies after Sunday's debate, however, offered different public views on Ma's performance, with one showing he gained a few percentage points while another showed his support had slipped by several points.

The United Daily News poll showed that support for the Democratic Progressive Party (DPP) ticket of Hsieh and vice presidential candidate Su Tseng-chang rose by 3 percentage points to 21 percent, while support for the Kuomintang (KMT) ticket of Ma and Vincent Siew -- slipped by 7 percentage points to 49 percent, compared to a poll conducted 10 days ago.

Meanwhile, a poll carried out by the China Times showed that support for both DPP and KMT tickets rose slightly, to 23 percent and 49 percent, respectively, with a margin of error of 2.7 percent. Support for Hsieh went up by one percentage point while that for Ma rose by two percentage points, according to the poll.

More interesting than the particular numbers is the vast, hilarious gap between Ma and Hsieh. Who can take these polls seriously? In the Chinese Times poll Ma leads Hsieh by 26%, while in the United Daily News Ma leads Hsieh by 28%. Back here in reality, Hsieh lost the Taipei mayor election by 15%. In other words, according to these two pro-KMT papers, Ma is going to beat Hsieh by a gap 50% greater than that generated in the Taipei area, the Bluest area in the nation.

Sure. I believe that.

In 2000 3% separated Chen from Soong; in 2004; it was less than 1%. Whatever the outcome, it is hard to imagine either man winning over 25%.

The CNA also reported on Hsieh's attack on Ma's budget plan.

Hsieh said Ma was "being too rash" and warned Ma would be "bringing down the economy," by aggravating the nation's deficit, worsening inflation and increasing the tax burden for the public.

Hsieh on Monday also attacked Ma's calls for investing around NT$4 trillion into the economy, among which the government will spend NT$2.65 trillion and will attract NT$1.3 trillion from the private sector. The money would be spent on 12 major infrastructure projects, according to Ma.

Hsieh repeated what he said on Sunday that this will mean that each household will have to write Ma a NT$400,000 bounced check.

He pointed out that Taiwan's annual budget is only between NT$1.5 trillion and NT$1.6 trillion. Even if Ma can serve two terms with a budget of NT$12 trillion, if the government spends about NT$2.6 trillion on the project, it will squeeze budgets for national defense, social welfare and education, Hsieh said.

For his part, Ma said that he had explained his policy in Sunday's debates, and will leave the details for related government agencies. He has on several occasions criticized Hsieh's DPP party for causing Taiwan's economy to suffer during its eight-year rule.

Ma's economic plan is quite simple. As I've often noted, locals outside the tech-driven export economy experience a very different Taiwanese economy, one with stagnant incomes and rising living costs, making KMT attacks on the DPP credible. I've also observed that the KMT spent tons of cash on the Jan 12 legislative election, which it will now have to recoup by tapping flows of government spending. Ma is simply signaling his supporters that zillions of dollars will indeed flow out of the government into local coffers all over Taiwan, irrespective of debt (for a look at what will happen in a Ma economy, see Japan's massive debts under the LDP). Hsieh has a strong issue here if he can keep hammering Ma on debt....

The KMT has forged tight cooperation with Beijing.... and one way China will play a big role in this local political economy through the provision of gravel for it. Taiwan is already dependent on China for gravel -- in 2006 the cut-off of imports from China, which supplied 20% of demand -- drove gravel prices up all over the island, and sent Taiwanese scurrying to Vietnam and the Philippines to develop alternate sources. Taiwan Journal summarized the clout China has in the local political economy last November:

The ban on gravel exports has produced economic ripples on both sides of the strait. Immediately after imports stopped, the price of gravel in Taiwan initially skyrocketed from US$13.8 to US$30.8 per cubic meter, and no longer having access to Taiwan's lucrative market means that gravel exporters in China's Fujian Province have been hit hard as well. High prices and the suspension in trade left Taiwan with a shortfall of 25 million cubic meters of sandstone this year. As a consequence, overall economic development has naturally slowed and many large-scale public construction projects have been forced to halt due to the lack of materials.

Without China, the article notes, it will be difficult to grow the construction-industrial economy... and China has already said it will consider re-opening the trade in gravel. Given KMT-PRC cooperation, and the necessity of gravel to enable the KMT to revive the local economy that it has starved, we'll see this trade resume when Ma comes in. Thus, the new Taipei Port is specifically aimed at the Construction-Industrial State -- its first two wharves were gravel wharves (completed in 1998), original meant to catch ships that serviced the Keelung-Hualien gravel route, since Keelung had become too small and inconvenient. Analysts expect a big construction boom in the north if Taiwan permits direct links. Note how well-placed the Port of Taipei is to service ships from China feeding gravel and other products into the concrete maw of Taipei's insatiable construction market...

[Taiwan] [media]