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The Kuomintang at a Crossroads: Should the Kuomintang Rethink Its China-Leaning Posture?

Supporters of Han Kuo-yu, who represents the opposition Kuomintang, during a campaign rally a day ahead of Taiwan's presidential election. Image by Hsiuwen Liu/ Shutterstock. Taiwan, 2020.

Supporters of Han Kuo-yu, who represents the opposition Kuomintang, during a campaign rally a day ahead of Taiwan's presidential election. Image by Hsiuwen Liu/ Shutterstock. Taiwan, 2020.

Just before midnight on February 6, a plane carrying 247 Taiwanese evacuated from Wuhan, the epicenter of the coronavirus outbreak, touched down at Taoyuan International Airport.

Among the passengers were one person who contracted the coronavirus and scores of the evacuees’ spouses who are Chinese citizens. They were not on the evacuation priority list that Taiwan's government had provided China. And all 247 passengers, at Beijing’s insistence, did not wear protective gear. Public anger erupted, and subsequent evacuation flight schedules were cancelled.

The hiccup also exposed a controversial pro-Beijing figure: Hsu Cheng-wen(徐正文), a Taiwanese businessman who is a member of the KMT’s Central Committee and also an advisor to the Chinese Communist Party (CCP), in addition to his role in a Beijing-led organization that promotes unification of China and Taiwan. Hsu voluntarily acted as an unofficial mediator of this China-led evacuation because Beijing refused to negotiate directly with the Taiwan government, which it does not officially recognize.

The bungling of this evacuation and Hsu's double-faced role touched a nerve in Taiwan society. Meanwhile, a clip in which Hsu read excerpts from a book by China's President Xi Jinping(習近平) on governance emerged online. It reinforced not only Hsu’s image as a proxy for Beijing but also highlighted the KMT’s pro-China leanings. The KMT immediately suspended Hsu in response to public outrage and to distance itself from the CCP.

When Taiwan Profits From Political Isolation

This perfect storm explained the main reason why the KMT was battered in the presidential and legislative elections in January. And Hsu is but a symptom of chronic disease within this hundred-year-old party, highlighting the predicament the KMT finds itself in under the current domestic and geopolitical climate.

Last year, Taiwan President Tsai Ing-wen(蔡英文)’s flat rejection of Chinese President Xi Jinping’s “one country, two systems(一國兩制)” offer and her firm endorsement of the Hong Kong protests has led to unprecedented public support from Taiwan and Hong Kong. After her election in 2016, Tsai and other members of the ruling Democratic Progressive Party have also cultivated close ties with Washingtion, during which Congress has passed pro-Taiwan legislation including the Taiwan Travel Act in 2018 and TAIPEI Act this year

In January’s elections, the KMT was punished by Taiwan’s voters for its pro-Beijing stance.

The party’s slow response to the “one country, two systems” and cautious sympathy for the Hong Kong protesters have also given rise to criticism. Its presidential candidate, Han Kuo-yu(韓國瑜), gave the appearance of preferring China to the U.S., making people more suspicious. He met with a Beijing-appointed official, the director of Liaison Office of the Central People’s Government in Hong Kong, during an early 2019 visit in Hong Kong. In a first for a Taiwanese presidential candidate, he cancelled a planned visit to the US during the election campaign. The KMT appears ever more distant from its big brother of the Cold War period.

And now, the coronavirus pandemic crisis has further boosted Tsai’s administration which has been lauded by the international community for its competent response.

With just less than 500 cases and 7 deaths in Taiwan make the international community more curious about Taiwan’s success. Many analysts have noted that Taiwan benefited from its political isolation from and distrust of China. Once considered a destabilizing force for the region, the pro-independence faction in Taiwan is now praised for its experienced China crisis management, while the KMT is at rock bottom for its unseemly close relationship with Beijing.

Red Scare in the Blue

Losing one election is not a crisis for the KMT, whose landslide victory in the 2018 local elections still reverberates, blaming it on fickle voters alone cannot explain its roller coaster-esque journey.

According to a 2020 election survey by Taiwan’s Academia Sinica, public polls showed that 72% of the voters under age 40 supported Tsai. The approval rate for Han was 15% among the same demographic group, which was attributed to the younger generation’s disdain of the KMT due to its image as Beijing’s proxy.

The ageing KMT desperately needs support from the youth. According to internal data, the number of party members who have reached a full-year membership now stands at 345,000, with members under age 40 accounting for only 3.16% (less than 9,000) of the whole party.

When reform-minded members of the KMT contemplate the loss of an entire generation of Taiwanese youth, a profound question comes to mind: Has the KMT learned the lesson from its bitter history in China? It lost the entire Chinese mainland and now has lost Taiwan.

Hsu is not the lone figure to be seen as red agent in the KMT. The influence of China on KMT politicians runs from the top leadership down to the grassroots.

But Hsu represents indeed a typical interest group within the party, taishang, or wealthy Taiwanese businessmen with vested interests in China.

There are an estimated 1 million taishang in China, and they are one of the most important sources of support for the KMT. Taishang operate well-organized associations in every Chinese province, and in every election, this community mobilizes members to return to Taiwan to vote for the KMT with cheap flights subsidized by Beijing. With anti-Beijing sentiment on the rise, they are increasingly suspected as being a proxy for Beijing due to their conflicts of interest.

“Many KMT members have business or investment in China which has made Taiwanese people concerned about our China policy” said Alfred Lin( 林家興 ), former head of the KMT Youth League, "It’s also the crucial reason why a lot of young people are not willing to join the KMT."

Lin, now an editor at New Public Report, an independent think tank in Taiwan, has discussed with young KMT members about ways to wean the party off influences from the CCP. Their goal: prevent the “red unification forces” from seeping through the party.

Kuang Bo-teng(匡伯騰), a 37-year-old lawyer and KMT member, is also very concerned about the party’s image of being “Beijing's agent” in Taiwan. “If the new [KMT] chairman only talks but does little to reform, no one could save this party anymore.”

It's the first time that the issue can be discussed publicly within the party. For years, the KMT has rejected being labelled as “red proxy” but now it has no choice but to face the rising criticism squarely, especially growing call for action to clean the party from the young members.

During the chairman's by-election campaign on March 7, newly elected KMT Chairman, Johnny Chiang(江啟臣), a 48-year-old rising star and incumbent legislator, echoed this sentiment from young members that “those who want to use KMT to do business must quit.“ His rival, the former Taipei mayor, also said the KMT must tackle the corrupt business culture within the party.

“The KMT was reluctant to face this problem but its changed attitude shows a sign, the party had realized that it hardly wins the trust of Taiwan's voters due to its pro-Beijing political and economic network,” said Wu Jieh-min(吳介民), deputy researcher of Academia Sinica of Taiwan. He is an expert on the impact of China's Sharp power in Taiwan and a longtime observer of the influence of this network related to KMT’s cross-strait policies.

The pro-Beijing network: as Many as 40% of KMT Central Committee Members Have Business Interests in China

Then, how big exactly is the pro-Beijing network within the KMT?

Speaking on background, multiple KMT members from different groups and generations that the party has way too many “panda-huggers”, especially in the Central Standing Committee (CSC), the top decision-making authority of the party. It would be a tough mission for the new chairman to tackle these interests.

One source at the top of KMT leadership estimated around 1/4 members of the CSC have business in China. However, in collaborating with the New Republic Report, we found that the real number exceeds that.

According to the open sources from KMT website and election materials, we conducted background research of KMT CSC. The CSC has 39 members, 32 of which are elected by Central Committee members, with the term limit extended from 1 year to 2 years in 2005. We found that over a 10-year period (2009-2019) the proportion of members who have economic ties in China increased from 22% to 47%.

Between 30% and 40% of CSC members during every term (over 9 terms in 10 years) had "cross-strait background"--they were either taishang or prominent members of associations promoting cross-strait relations. Most notably, there has been an uptick in this trend in recent years. Between 2009 and 2012, the proportion had been 22%-33%. In 2013, it shot up to 44%. Among the latest term, 47% have business ties with China.

We also found that among 26 who served for more than five terms, 12 of them are taishang -- almost half. Among the larger Central Committee, 40 of the 210 members have China connections.

They can generally be classified as the following:

Taishang

More and more taishang participate in the party’s decision-making body, making this group one of the influential forces inside the party when electing the party chair. There were 10 among the 2019 CSC , double the number from 2009. The recently retired acting chairman of the KMT, Lin Rong-de, is a prominent taishang.

● Associations promoting cross-strait relations

Cross-strait relations have prospered since the victory of KMT candidate Ma Ying-Jeou in Taiwan’s 2008 presidential election, after which many associations have sprung up in the name of “cross-strait exchange". By taking a role in those associations, many KMT members are able to interact with high-ranking CCP officials.

According to one KMT Taipei city councilor, prior to Xi’s anti-corruption campaign, as many as hundreds of Chinese officials would visit Taiwan, with “visit fees” ranging from 30,000-50,000 RMB (4500-7000 USD). Some KMT members maintained good relations with the CCP in order to profit from the business brought by high-ranking Chinese officials’ visits to Taiwan, which they outsourced to travel agencies.

● Agricultural product agents

Some KMT members have secured rights to sell Taiwanese agricultural products to China since 2005. According to well-informed insiders, those who have become agents in promoting agricultural trade across the strait also profit from certifying agricultural products sold to China.

● Financial investment and culture incubators

In 2018, Beijing announced the “31 Policy Measures to Benefit Taiwan”, a slate of subsidies to attract Taiwan young people working or having a startup in China. There are 75 incubators established for Taiwanese across China. Subsequently, some KMT politicians received permission to run the incubators. They act as recruiting agents to introduce Taiwanese talent to China.

Yesterday’s rival, Today’s partner

Historically, the KMT had had a very intricate relationship with the Chinese Communist Party (CCP).

Two rivals cooperated twice from 1920 to 1950-- the first was against the warlords of northern China and the second was against Japanese invasion. In between those episodes, the CCP made inroads infiltrating the KMT, prompting Chiang Kai-shek(蔣介石) to spearhead a violent purge of Communists inside the party. But it did not prevent the KMT’s eventual loss to the CCP in the Chinese civil war.

After retreating to Taiwan in 1949, Chiang Kai-shek was bent on preventing Communist infiltration of Taiwan. He and his son, Chiang Ching-kuo(蔣經國), purged political dissidents in a sweeping campaign known as the White Terror that lasted for almost four decades, ending in 1987. The end of the White Terror and martial law was followed by Taiwan’s democratization and the emergence of a local Taiwanese identity.

So how did the KMT evolve from anti-communism to a party that is pro-Beijing?

The turning point was the reconciliation between the KMT and CCP in 2005, then-KMT chairman Lien Chan(連戰) ’s historic ice-breaking visit to China.

One needs to look back to the 2004 Taiwan's presidential election. Lien failed to return the KMT to the presidency after the 2000 presidential election, won by the DPP’s Chen Shui-bian(陳水扁), which ended the KMT’s half-century rule. He turned his attention to China.

At the time, China’s entry in the WTO in 2001 elevated its global stature both economically and politically, and many countries around the world wanted to be Beijing’s friend. Lien's KMT also found its new role in cross-strait relations in this context.

Lien embarked on a “peace journey” to China in April 2005. He met then-CCP general secretary Hu Jintao(胡錦濤), the highest-level meeting between KMT and CCP since Chiang Kai-shek and Mao Zedong(毛澤東) met in Chongqing in 1945.

Both of these parties united by Chinese nationalism came together to work against Taiwanese nationalism. They saw the Taiwan-born DPP as a common enemy that prompted two rivals to forget the long history of animosity --Lien and Hu’s handshake represented the end of the 45-year confrontation between the two sides, they claimed the Lien-Hu meeting “the achievement of Chinese across the strait”.

It was reminiscent of the CCP’s classic co-option strategy toward the KMT, united front tactics —the most important tactics to win over mainland China from the KMT, according to Mao Zedong in the 1940s. The core spirit of united front tactics is to befriend a smaller enemy in order to confront a larger one. This approach, invented by Lenin, was well-practiced by Mao and broadly implemented in China’s foreign policy is often referred to in the West as China’s “sharp power”.

The KMT-CCP rapprochement also coincided with a globally optimistic mood regarding China's development and warming U.S.-China relations. Compared to the DPP president Chen, who was seen as a "trouble-maker", the KMT was viewed as being on the right side of history.

The push for a win-win cross-strait relationship intensified in 2008 when the KMT’s Ma clinched the presidency. He unleashed a flurry of policies to build closer ties with China, launched direct flights, increased commercial exchanges, and hosted, frequent official visits. Over the past 15 years, more and more high-ranking KMT figures had investment or business projects in China with CCP special permission.

On the other hand, according to sources, many Chinese officials also saw an opportunity to reap the economic benefits and even demanded kickbacks for investment approval. An intricate network of political and business interests across the strait began to form.

The CCP offered the KMT not only the personal business interests in China but also a relatively looser diplomatic space (Taiwan was granted World Health Assembly observer status during Ma’s time in office, but lost it after Tsai and the DPP took power in 2016). Furthermore, at its peak, more than 4 million Chinese tourists visited Taiwan in 2015, almost 40% of all foreign visitors that year. In 2012, a number of Taiwanese rich who had huge business stakes in China expressed their support for the 1992 Consensus before the voting day, enabling Ma to secure his reelection as Taiwan’s president.

In the 11 years between 2005 and 2016, when President Ma met Chinese leader Xi Jinping in Singapore, the KMT was at ease dealing with both Beijing and Washington. “Taiwan must rely on China ’s kindness” became the KMT’s diplomatic and economic rhetoric.

Since Lien’s 2005 visit to China, the KMT's cross-strait policies have been shaped more by economic rationales than by aspirations for unification. At the time, such a mindset was pretty much in sync with the mainstream sentiment in Taiwan. But after Xi adopted more aggressive Taiwan and foreign policies in 2013, trepidation in Taiwan and the international community has grown.

Critics point out that Beijing has in recent years been flexing its sharp power to expand its political influence outside China. Meanwhile, the cross-strait economic relationship has shifted from a complementary dynamic to a competitive one. There is a growing sense that Taiwan's reliance on the Chinese market risks undermining its political independence. Moreover, the political identity of Taiwanese has changed profoundly.

A steady trend in polls shows that an estimated 60% Taiwanese do not want to be unified with China (including who are pro-independence or merely wish to maintain the status quo). There has been a realization that Beijing’s prerequisite for closer economic ties is unification.

Democratic values and Taiwan identity are on the march in Taiwan but the KMT has stressed economic benefits while turning a blind eye to political risks, rendering itself too susceptible to Beijing’s influence.

The KMT is to Beijing what Icarus to the sun - in Greek mythology, Icarus with his wax wings, flies too close to the sun and then falls from the skies because the wings melt from the heat.

A Tool in the CCP’s United Front Toolbox

A former KMT management observed that the CCP granted the KMT special treatment in hopes of bolstering the prospects of unification. More KMT politicians have business stakes in China, while businessmen joined the KMT to maximize their commercial interests. Over time, the KMT is influenced by those interest groups and out of the orbit of mainstream opinions.

“At least half of the Taiwanese believe that China is not a friend but a foe. Therefore, KMT’s intricate relationship with Beijing and its economic ties in China ultimately takes on a political, rather than legal dimension,“ Wu Jieh-min said, "People will ask when choosing between personal interests and national security, where would the KMT stand? “

Wu said that Beijing sees the KMT as a useful tool to implement its unification plan. Once KMT is no longer politically relevant, its value to Beijing will be significantly lower. The biggest challenge for Johnny Chiang is to reduce the KMT’s reliance on Beijing.

In addition, the KMT has an Achilles heel.

When Tasi Ing-wen’s DPP government took power in 2016, it transferred KMT’s ill-gotten wealth - 7 billion Taiwanese dollars - to the state coffers. According to people familiar with the situation, the party’s monthly costs of about 30 million NTD are mainly covered by political donations from Taiwanese businesspeople. Some within the party worry that Beijing will use the capital from the Taiwanese businessmen to influence KMT.

“Will the CCP take the opportunity to use it to its advantage? These influences are usually invisible. The weaker the KMT is, the more red it becomes. The more red it becomes, the weaker it gets. It’s a vicious circle,” said a senior KMT advisor specializing in cross-strait affairs.

The advisor observed that most Taiwanese businessmen just want peaceful cross-strait relations because it would benefit their businesses, but some do have ambitions to influence the party's policies. The anti-Beijing sentiment of the party reformists also upsets some Taiwanese businessmen representatives within the party. They prefer a "one country, two systems" arrangement like China has with Hong Kong, which is not the stance of the KMT.

The KMT needs more donations from individual supporters, but more importantly it must regain the trust of Taiwan society. If it relies only on taishang, it will fuel more distrust. It would be like drinking poison when one is thirsty.

The Party is Over, Pro-china or Not, That’s a Question

After 1949, the animosity between the KMT and CCP defined the triangular relationship between Washington, Beijing and Taipei, with ramifications for the broader region. The new era of strategic competition between the US and China has put the KMT in an awkward position.

When the U.S. China relations were good, the KMT could gain advantage from both sides. Now, it’s not easy for the KMT to hedge, while the two superpowers are more confrontational after the trade war and coronavirus outbreak. The party is over.

The KMT finds itself in a prisoner's dilemma situation: to keep its economic interests in China and to maintain the exclusive relationship with Beijing, it is reluctant to offend Beijing, which has led to the distrust and disdain from the young people.

According to a recent poll, 80% of Taiwan’s youth (under 29) identify themselves as Taiwanese not Chinese. On the other hand, while the DPP and Taiwanese identity gain more traction, the KMT's failure to retain power has also earned the CCP’s scorn. Anxious KMT supporters, caught between commercial interests and Chinese nationalism, will lean towards China.

A KMT advisor specializing in cross-strait affairs observed that the CCP upholds the principle of real power. “We must prove our capacity and pay less attention to whether Beijing is happy or not.” But Ma Shao-zhang (馬紹章) disagrees, the former high-ranking cross-strait official of Ma Ying-jeou government (Vice President of the Straits Exchange Foundation). International negotiations, he says, do not need trust. But given the uniqueness of cross-strait relations, it requires trust before any negotiation.

Will this attitude adjustment by the KMT upset Beijing and worsen cross-strait relations, potentially destabilizing the region?

"My guess is that the KMT will try to walk a fine line, attempting to refine its policy on cross-Strait relations sufficiently to win more support from voters, while not derailing its relations with Beijing." Said Bonnie S. Glaser, a senior adviser for Asia at the Center for Strategic and International Studies in Washington.

The KMT has argued that it can manage relations with mainland China more effectively than the DPP because it retains communication channels with Beijing. That objective will be difficult to achieve, but not impossible. Added Bonnie S. Glaser.

Unification, independence, or the status quo?

The crux of the problem is that despite its Chinese roots, the KMT has existed and evolved in Taiwan for seven decades. Because of this, the KMT still saw support from 40 percent of Taiwanese voters in the last election, begging the question: where do they want to take Taiwan?

Johnny Chiang, the newly elected KMT chairman, advocated for a return of the spirit of 1992 Consensus in which the disputed issues over sovereignty will be put on hold so that more practical issues could be dealt with. Along with it, he also called for a push of democratization in China.

“It’s a fate that Taiwan cannot escape with its proximity to China, we can have various imagination of unification and not to see it as a taboo,” said Ma Shao-zhang with his long thought on this ultimate question. He was also instrumental in planning Lien Chan’s maiden visit to China in 2005.

“It means the KMT could accept "ROC, Taiwan" which was proposed by President Tsai. In the meantime, the KMT can still pursue a vision different from the DPP.”

Ma’s views are in line with those of Alfred Lin and some KMT members who are enthusiastic about the party's history in China. They believe the KMT should oppose the CCP and authoritarianism, an approach aimed at defending a democratic Taiwan and a free China.

Will the idea of the unification with a democratic China still find resonance in Taiwan? After Hong Kong's lesson of blood and tears, it remains to be seen. But one thing is for sure: in the midst of a strengthening Taiwanese identity, growing unification pressure from Xi Jinping, and deteriorating U.S-China relations, the KMT does not have much wiggle room to achieve balance.

“Why is the DPP more concerned about the democracy and human rights issues of China and Hong Kong? KMT should export democracy to China, but now it’s importing authoritarianism back to Taiwan,” said Kuang Bo-teng, a 37-year-old lawyer and a KMT member.

“If the KMT always stands by the CCP every time cross-strait tensions rise, people will naturally suspect our belief and affiliation. We should not look like the Taiwan branch of the Chinese Communist Party.”

Translated by Chen Guo.

New Republic Report contributed to this article.

To read the Chinese version, please click here.