Wednesday Short Shorts

Ad for a candidate for the New Power Party.

Well, Taiwan called for a peaceful resolution of the South China Sea disputes as the US sailed a destroyer uneventfully through international waters China is attempting to occupy. Since Ma Ying-jeou is every bit the Chinese expansionist that Xi Jin-ping is, his idea of "peaceful resolution" is the same as Xi's: nobody contests China's territorial grab. The US has the right idea but it is years too late on this -- it should have done this right away when China began expanding there. The US response instead was indecisive and dilatory. The President's previous top China policy guy just got a job with Eurasia group, which does much China consulting. I'm sure there is no connection between these facts.

Meanwhile the election is 90 days away. The domestic economy is still sluggish, giving voters every reason to punish Ma. This week campaign posters began appearing all over; hope to have some pics this weekend. Note that KMT Chairman and presidential candidate Eric Chu swapped himself for Hung Hsiu-chu 90 days before the election began, just before posters would be printed, and just right for the 90 day leave of absence, the longest civil servants are permitted to take. I'm sure there is no connection between these facts.

An interesting and inevitable new wrinkle appeared this week as well: Eric Chu's dad-in-law, Gao Yu-ren, a powerful, wealthy, well connected KMT heavyweight, is becoming an issue, as many predicted. Indeed, many observers thought that Gao's many deals were a factor keeping Chu from running. This week the first trickle in what is likely to become a flood...

Chinese Nationalist Party (KMT) Chairman and presidential candidate Eric Chu (朱立倫) might have pulled some strings to bring about an out-of-court settlement between the Ministry of National Defense and Vtron Technology, the Taiwan Solidarity Union (TSU) caucus said yesterday.

TSU caucus convener Lai Chen-chang (賴振昌) told a press conference that Vtron owner Kao Yu-jen (高育仁), Chu’s father-in-law, won a ministry contract in 2013 to manufacture key components for the Tien Chien II (TC-2), a medium-range air-to-air missile, by tendering a bid that was 35 percent below the minimum and failed to deliver.

Vtron’s successful bid generated doubts in the arms manufacturing industry from the outset and Vtron did not disappoint, drawing a complete blank in terms of development, Lai said, adding it was very suspicious that the ministry had a sudden change of heart and did not pursue legal action against Vtron.

Today the TSU, obviously acting on the DPP's behalf so that the DPP avoids looking like the attacker, brought up another interesting case. They alleged that Chu hasn't been reporting that he owns a tiny portion of his father-in-law's firm for four straight years. Going to be difficult to claim ignorance since Chu is, well, an accounting professor.

This drip-drip-drip will likely continue throughout the election period -- indeed, a couple of friends suggested that the reason Chu waited until now to launch his bid is that there will be less time to bring up all the shady, sweetheart deals the dad-in-law is party to. Had Chu run in April, the DPP would have been hammering him for months.

DPP candidate Tsai Ing-wen won her case against Christine Liu for allegations over the TaiMed mess. The whole was a smear that fell apart in counter-allegations of forgery (old post). The DPP remains firmly in the driver's seat, and the real struggle will be over the legislature.

However, the most important thing that came out this week isn't about the election. It's about the nation's finances and investment. Just as ECFA was designed to increase Chinese imports to Taiwan and decrease Taiwanese exports to China, and the services pact to allow Chinese firms to overwhelm smaller Taiwanese firms as well as bring Chinese into Taiwan, so the financial services agreements are bearing fruit: Taiwan's development capital is being vacuumed up by China. Read it.
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Daily Links:

• Peter Enav on what Taiwan should do in the face of Beijing's sanctions
• EU once again warning on fishing.
• MND's 2015 National Defense Report contains a board game.
• Hey guys, Chinese tourism is a net loser for Taiwan economically, and the aviation pacts are another example of how cross-strait agreements help big business at the expense of locals. When will people understand this?

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