Identifier
Created
Classification
Origin
04TAIPEI3780
2004-11-29 08:49:00
CONFIDENTIAL
American Institute Taiwan, Taipei
Cable title:  

WANG ON FATE OF SPECIAL BUDGET POST LY ELECTION

Tags:  PGOV PREL TW 
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This record is a partial extract of the original cable. The full text of the original cable is not available.
C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 003780 

SIPDIS

STATE PASS AIT/W

E.O. 12958: DECL: 11/29/2014
TAGS: PGOV PREL TW
SUBJECT: WANG ON FATE OF SPECIAL BUDGET POST LY ELECTION

Classified By: AIT Director Douglas Paal, Reason: 1.4 (B/D)

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 003780

SIPDIS

STATE PASS AIT/W

E.O. 12958: DECL: 11/29/2014
TAGS: PGOV PREL TW
SUBJECT: WANG ON FATE OF SPECIAL BUDGET POST LY ELECTION

Classified By: AIT Director Douglas Paal, Reason: 1.4 (B/D)


1. (C) Summary: LY President Wang Jin-pyng told the AIT
Director November 24 that if the DPP controls the LY
speakership after the December election, Taiwan's USD 18
billion special budget for the procurement of advanced weapon
systems will pass but only over vigorous objections by the
Pan-Blue. Wang emphasized, however, that if the Pan-Blue
were to retain control of the LY speakership, he would be
able to find a formula to bring the KMT around to support a
budget, although at some reduced funding level. This, he
claimed, would avoid exacerbating the political divisions
that currently exist within Taiwan. End Summary.

Special Budget Post December 11
--------------


2. (C) Legislative Yuan (LY) President Wang Jin-pyng told
the AIT Director November 24 that if the Democratic
Progressive Party (DPP) controlled the LY speakership, the
USD 18 billion special budget for the procurement of advanced
weapon systems would pass but only over vigorous objections
by the Pan-Blue and its supporters. Wang said that recent
polls show that there are more people who oppose the special
budget than there are people who support it. He reiterated
that if the Pan-Blue were deprived of the LY speaker
position, the opposition would have no reason to support any
DPP policy initiative. Wang added that if the special budget
were pushed through on a party line vote, it could lead to
renewed street demonstrations like those after March 20.
Wang said he worried that, in this case, anti-special budget
protests might deteriorate into expressions of
anti-Americanism.


3. (C) Wang emphasized, however, that if the Pan-Blue were to
retain control of the LY speakership, he would be able to
find a formula to bring the KMT around to support a budget,
at some reduced funding level, that would avoid exacerbating
the political divisions that currently exist within Taiwan.
Wang said that the optics of the LY being able to secure a
reduction on the cost of the weapon systems is vital to
winning support from the Taiwan public. He remarked that
people go to the traditional markets and haggle over one or
two NT dollars, thus they expect the government to fight over
items that cost billions.


4. (C) Wang asked the Director if the USG still sought LY
passage of the special budget. The Director responded that
if the budget did not pass, it would send a clear signal to
policymakers in Washington that Taiwan is not serious about
its own self-defense and lead to questions over why the U.S.
should be prepared to fight for Taiwan when Taipei has shown
no commitment to defend itself.

DPP's Anti-Wang Strategy
--------------


5. (C) Wang told AIT Director that Chen Shui-bian and the DPP
are now intensifying their attacks on Wang because the DPP
believes that it will face a Wang-Ma ticket for the 2008
presidential race. According to Wang, the DPP's strategy is
to marginalize Wang by taking the LY speakership away from
him and mothballing him by placing him in the Control Yuan
(Note: President Chen recently publicly offered the Control
Yuan position to Wang. End Note) Wang said that should the
DPP succeed in eliminating Wang as a political player, it is
unlikely that Ma would have a future. Wang asserted that
Taiwan would not be able to accept the Hong Kong-born Ma as a
leader unless Ma was paired up with Wang. Wang added that
Taiwan would not even accept Ma as KMT Chairman. Wang said,
"If Ma were KMT Chairman, the party would be branded as the
Mainlander's party."

Comment: Self-Interest or Serious Warning?
--------------


6. (C) The clear subtext of Wang's comments on the special
budget was that only he could ensure that the special defense
acquisition budget would pass in a non-confrontational
manner. Thus the U.S. should see his reappointment as LY
Speaker, even if the Pan-Blue loses on December 11, as in its
best interests. Nevertheless, Wang's warnings about the
growing partisan divisions over the issue are legitimate.
The People First Party's (PFP) decision in September to run
against the defense budget and the DPP's response of labeling
the Pan-Blue as sell-outs for their policy reversal have
given the issue a partisan overlay that did not exist a year
ago. Wang was most likely exaggerating the prospects for
street confrontations over the budget, since opinion on the
subject, while divided, does not yet appear to be deep or
emotional.
PAAL