MA AND SOONG MEET: KMT-PFP MERGER NO TIME SOON

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 004871

SIPDIS

STATE PASS AIT/W

E.O. 12958: DECL: 12/13/2015
TAGS: PGOV TW
SUBJECT: MA AND SOONG MEET: KMT-PFP MERGER NO TIME SOON

REF: TAIPEI 4850

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


1. (C) Summary: On December 12, KMT Chairman Ma Ying-Jeou met
with PFP Chairman James Soong to discuss the possibility of
merging the two parties following the KMT's watershed victory
(and the PFP's embarrassing defeat) in the December 3
"three-in-one" elections. Contrary to the hopes of some
Pan-Blue supporters, however, instead of announcing an
imminent merger, the two parties announced preliminary
measures aimed at preserving the slim Pan-Blue advantage in
the Legislative Yuan and using that advantage to promote
Taiwan's economic welfare through expanding the "three links"
with China. The KMT and PFP also pledged to "maintain an
appropriate defensive capability" for Taiwan, and to
"resolutely oppose expensive arms procurement." In their
public statements before the meeting, Ma did not welcome PFP
members to join the KMT's ranks, and Soong did not once
mention the word "merger," suggesting that neither leader
wants a merger to occur right away, if at all. KMT
leadership is opposed to the absorption of large numbers of
PFP LY members at one time, fearing they could force new
Central Committee and Central Standing Committee elections
and split the legislative pie in 2007. PFP members are split
-- stronger, nationally-known LY members are eager to return
to the KMT to improve their chances of being nominated in
future legislative elections, while weaker, lesser-known
members will face political oblivion without the PFP.
Nothing tangible came of yesterday's meeting, but, by
beginning the merger dialogue, Ma can claim to be honoring
his earlier pledge to reunite the Pan-Blue camp, and Soong
has preserved the PFP's independence and waning political
viability, at least for the time being. If merger is in the
cards, it is still a long way off. End Summary.


2. (U) On December 12, KMT Chairman Ma Ying-jeou and his PFP
counterpart James Soong met in Taipei to discuss, among other
things, the prospect of uniting the two Pan-Blue parties
under the KMT banner. In his remarks before the meeting,
Soong emphasized the importance of KMT-PFP cooperation to
improve Taiwan's economic health and root out corruption at
the local and national level. Soong did not mention or
allude to the possibility of merging the two parties.
Subsequently, Ma echoed his support for expanding KMT-PFP
cooperation to assure Taiwan's economic welfare and to
improve government accountability, while specifically
mentioning the goal of merging (hebing) the two parties.


3. (U) Following the four-hour session, KMT Secretary-General
Chan Chun-po announced that the two chairmen had reached a
consensus on collaborating to protect Taiwan from being
marginalized economically, to promote cross-strait trade, to
expand the "three links," and to push for Taiwan's
participation in "ASEAN-plus-four." Both leaders endorsed
protecting the rights of Taiwan's retired civil servants, and
supporting Taiwan's law enforcement organizations in their
efforts to investigate and prosecute corruption scandals,
regardless of the party affiliation of the accused.


4. (U) Chan Chun-po and PFP Secretary General Chin Chin-sheng
also announced that the parties agreed to establish a
cooperative mechanism for nominating candidates for city
council elections in December 2006. Notably absent was any
mention of the KMT nomination for Taipei mayor, which will be
held at the same time and to which PFP Chairman James Soong
aspires. The two Secretaries-General stated that KMT and PFP
will continue collaborating in the Legislative Yuan (LY) to
assure that legislation is "respectful of public opinion."
They renewed their parties' promise to get to the bottom of
the March 19, 2004 shooting of President Chen and
Vice-President Lu. Finally, of particular USG interest, both
parties pledged to "maintain an appropriate defense
capability for Taiwan," and to "resolutely oppose expensive
arms procurement."


5. (C) PFP LY member Christina Liu (Yi-ru) told AIT that the
Ma-Soong meeting produced no meaningful change, and that
there is no real prospect for merger for the foreseeable
future. Liu explained that the PFP still feels strong
resentment both from and toward the KMT following the KMT's
aggressive tactics in the last month before the December 3
elections. Sensing the possibility of a big victory, she
continued, KMT leaders pulled out all the stops to secure as
many positions as they could, unconcerned about the impact on
the KMT-PFP relationship. Additional ill will, she said, has
been caused by recent KMT efforts to exclude the PFP from
important discussions in the LY, including recent discussions
about altering the interest rate ceiling on consumer credit
cards.


6. (C) Liu said there are opponents to a Pan-Blue merger
within both parties. KMT leaders are willing to accept PFP
members one-by-one, but are opposed to absorbing all 32 PFP
legislators at one time, or maybe at all, fearing they would
demand new elections for the KMT Central Committee and
Central Standing Committee and would increase competition for
the 2007 LY elections. As for the PFP, Liu said it is split
almost down the middle: 14 stronger, better-known candidates
want to immediately jump ship to the KMT so they can begin
"fighting their way to the top" in time to secure an LY
nomination for the December 2007 race. The remaining 18
members, Liu included, are either "at-large" candidates or
are wholly dependent on a local, not national, power base.
Liu says she and her similarly-situated colleagues would be
swallowed up by the KMT, and left with no political future.
Liu says she and her similarly-situated colleagues would be
unable to compete within the KMT, and left with no political
future; therefore, they hope the PFP remains a separate
party, enabling them to run as PFP candidates in 2007.


7. (C) Liu predicted that although Ma may truly wish to
consolidate the two parties, it will happen in the distant
future, if ever. Liu, who has worked with Ma in the past,
said he will often follow the advice of those around him if
doing so would not violate his personal convictions. Since
at least some in the KMT leadership could lose their seats if
new CC and CSC elections are required, Ma is probably being
told to move slowly and with extreme caution. As for Soong,
Liu told AIT that he still genuinely believes he has a chance
to win the KMT nomination for Taipei mayor, and even to win
the election. Liu said that Soong is the last one to know he
doesn't have a chance in the mayor's race, but others within
the PFP want him to run because it extends the life of the
party, and thus, their own political careers.


8. (C) KMT leaders have claimed that the prospect of a merger
is hampered by the question of whether the PFP would lose its
seven "at-large" seats in the LY if it were to merge into the
KMT. The Pan-Blue alliance holds only a razor-thin majority
in the LY -- 111 of 220 seats -- and the loss of those seven
PFP seats would eliminate the Pan-Blue majority. Liu,
however, told AIT that this is simply a KMT canard: because
the at-large members were assigned on the basis of each
party's vote count in the December 2004 LY elections, the
absorption of the PFP by the KMT would not change the fact
that the PFP earned those seats in the 2004 election. In
addition, the LY is empowered to decide how to dispose of the
PFP's at-large seats in the event of a merger, and since the
Pan-Blues hold the majority, they could decide this issue to
their advantage.


9. (C) Comment. Despite the strong support of Pan-Blue
supporters, both KMT and PFP, and despite the hoopla
surrounding the Ma-Soong meeting, there was no real movement
toward merger during the Ma-Soong meeting. Ma does not want
Soong trying to leverage his weak standing through a merger.
Yesterday, Ma succeeded in using Soong to his advantage,
obtaining from Soong the picture of Pan-Blue cooperation
without any real cost. In so doing, Ma maintains the KMT's
momentum, and keeps Chen Shui-bian's DPP on the defensive.
This move will also satisfy KMT politicians who feared
competition from popular PFP legislators for the halved
number of seats at stake in the 2007 legislative elections,
and it will keep James Soong's political fortunes marginally
alive for one more year, at which time he could take a shot,
a very long shot, at the Taipei mayoral race. Nonetheless,
the more popular politicians in a PFP now on life support
will begin to sneak, one-by-one, back into a KMT that will
only selectively receive a few of them. Chairman Soong may
have preserved the facade of his political party for one more
year, but it will increasingly be a rump party with no viable
future, including his own. End Comment.
PAAL