KMT CHAIRMAN MA YING-JEOU ON DOMESTIC POLITICS AND

C O N F I D E N T I A L SECTION 01 OF 04 TAIPEI 000125

SIPDIS

SIPDIS

E.O. 12958: DECL: 01/17/2032
TAGS: PGOV PREL TW
SUBJECT: KMT CHAIRMAN MA YING-JEOU ON DOMESTIC POLITICS AND
BILATERAL ISSUES


Classified By: AIT Director Stephen M. Young,
Reasons: 1.4 (b/d)


1. (C) Summary: KMT Chairman Ma Ying-jeou told the Director
on January 17 that his party and the ruling DPP are locked in
a struggle in the Legislative Yuan (LY) over a KMT bill aimed
at ending DPP control of the Central Election Commission
(CEC). If the impasse, which also involves the annual
budget, cannot be solved, the LY may have to convene a
special session in the coming weeks. The Director stressed
the importance of not allowing domestic politics to block the
defense budget. Ma told the Director that the party's
Central Standing Committee (CSC) was considering but had not
yet made a decision on whether to select the KMT's
presidential candidate in March-April. (Note: Later the same
day, the CSC considered delaying the selection by one month.
End Note.) Ma said the KMT does not support but may not be
able to block the DPP's proposal to combine upcoming
legislative and presidential elections in early 2008. The
KMT believes such a format would increase vote buying
(supposedly mainly by the DPP) to the party's detriment.
Affirming that both the KMT and DPP view Taiwan as a
"sovereign independent country," Ma's only distinction was
that his party sees this entity as the Republic of China,
while the DPP prefers Republic of Taiwan. Ma suggested that
any possible future constitutional revisions should wait
until the new LY, based on single member districts, takes
office in 2008. The Director stressed the importance of
avoiding any constitutional changes on sensitive sovereignty
issues that would raise cross-Strait tensions. End Summary.


2. (C) The Director and Kuomintang (KMT) Chairman Ma
Ying-jeou discussed domestic politics and bilateral relations
during a meeting at KMT Headquarters on January 17. Ma
appeared more relaxed and less pressed for time than he ever
did during his mayoral days. After briefing Ma on his recent
Washington consultations, the Director asked about Ma's
expectations regarding domestic political developments in
2007, noting Ma's call for increased cooperation between the
pan-Blue and pan-Green camps. Ma responded that the KMT and
DPP have cooperated over the years in passing many bills in
the LY without a vote. So, there is already an inter-party
consultation mechanism in the LY. The KMT does not have this
type of cooperation with the Chinese Communist Party (CCP),
Ma added with some apparent understatement, referring to his
recent public remarks that the gap between the KMT and DPP is
less than the gap between the KMT and CCP.

LY Gridlock over CEC and Annual Budget
--------------


3. (C) Currently, Ma said, there are just two days left
before the current LY session ends on January 19, and many
budget items still require attention. However, the KMT and
DPP are currently in political gridlock over the organization
of the Central Election Commission (CEC),an issue he had
discussed that morning with LY Speaker Wang Jin-pyng. The
ruling DPP now controls 15 of CEC 17 seats, which is very
unfair, Ma argued. The LY is considering a KMT-proposed bill
that would change the CEC composition to reflect the strength
of political parties in the LY. Under this proposed bill,
the pan-Blue would have a one-vote majority on the CEC, but
DPP interests would be protected by a voting rule that
decisions by the CEC would require a two-thirds majority.
This would prevent domination by any single party. The DPP
is strongly resisting and refusing to negotiate the CEC bill
proposed by the KMT, Ma noted, adding that this has
infuriated the KMT LY caucus, which has retaliated by
boycotting the inter-party negotiations on the annual budget.



4. (C) The Director asked Ma whether the KMT would refuse to
pass the budget if the DPP is not flexible on the KMT's
proposed CEC changes. Ma responded that the decision on how
to proceed would be made by the KMT LY caucus. One
possibility, which the LY would have to approve, would be to
hold a special LY session after the end of the extended
regular session on January 19. An alternative would be to
pass the budget but freeze parts of it, as happened one year
ago. Such budget freezes are decided by the individual LY

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committees, such as defense. While the KMT can call a vote
on the CEC bill, the DPP can demand separate votes on each
article, which is a form of filibuster that can take many
hours. Wang Jin-pyng, who wants to avoid this situation,
hopes the KMT LY caucus will return to inter-party
consultations on the budget today. Ma said he told Wang to
press the DPP on the CEC issue and also that he has
"authorized" the KMT caucus to seek the best (negotiated)
solution of the issue. The tenure of the current CEC members
expires in June, Ma noted. If the KMT does not resolve the
CEC issue now, it will not have the budget issue to use as
leverage during the spring LY session. (Note: The LY is
legally required to pass the annual budget during the current
fall LY session. End Note.)

Arms Procurement
--------------


5. (C) The Director noted that Washington is closely
following the defense budget issue and that we care more
about the budget than about Taiwan's politics. If the budget
is passed, the Director explained, that will make it easier
to take other steps to strengthen U.S.-Taiwan relations.
However, if the issue is not resolved, that will create a
perception that the politics of Taiwan is operating against
its best interests. Ma said that the KMT's actions are not
directed against the U.S. The KMT supports reasonable arms
procurement and is ready to discuss all issues if the MND is
prepared to do so. Ma explained that the reduction in
funding for a submarine study reflected the fact that it was
impossible to spend a large amount for a feasibility study
before a decision had been made. Ma noted that the 2006
supplementary defense budget request has now been changed to
2007, and also said he was delighted that several recent
groups of U.S. experts had not raised the arms procurement
issue in their meetings with him.

Timelines for Nominating Presidential and LY Candidates
-------------- --------------


6. (C) The Director asked Ma about the controversy over
plans for early selection of the KMT presidential candidate.
Ma said the Central Standing Committee (CSC) would make a
decision on this proposal, which had been drafted by KMT
staff. Seventeen CSC members, who are also LY members,
formally proposed the early timing in a CSC meeting two weeks
ago. Therefore, Ma said, he was surprised when several KMT
LY members turned around and criticized what had originally
been their own idea. The practice of beginning presidential
candidate registration on March 1 is not new, Ma pointed out.
In 2003 the party, then in opposition for the first time,
began the registration process on March 1 to allow the
nominee to have sufficient time to campaign for president.
Following the presidential nomination, the KMT also has to
nominate LY candidates, a complicated process because the LY
is being cut in half and a new system of single member
districts is being instituted. KMT LY members want to
conduct the nomination process as early as possible to reduce
the chances that some potential candidates will recruit new
"dummy party members," to increase their primary votes. The
complicated LY nomination process will take at least three
months, Ma said. Districts will be divided into three
categories depending on how difficult it is to select a
candidate, and each category's nominees will be determined on
a different date, ranging from April to June. (Note:
According to media reports, the KMT CSC later on January 17
considered delaying selection of the party's presidential
candidate by one month, i.e., into May. End Note.)

KMT Opposed to Proposal to Combine Elections
--------------


7. (C) The Director asked about proposals to combine the LY
and presidential elections, now tentatively scheduled for
December 2007 and March 2008. Ma responded that the DPP now
supports holding the two elections together, probably on
January 19, 2008. The CEC, which originally opposed this
idea, has changed its position after President Chen and DPP
Chairman Yu Shyi-kun have come out in support. Holding the
two elections together would save some money but not much and

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there would be a four-month gap between the presidential
election and the May 20 inauguration. The KMT is especially
concerned, Ma said, that combining the elections would
increase the problem of vote buying (supposedly mainly by the
DPP) to the detriment of the KMT. Within the DPP, there is
also some opposition to holding the elections together, Ma
noted. However, election timing is within the CEC's
authority to decide, Ma pointed out, adding that the CEC
chairman is the government's "hired gun," and therefore, the
decision is currently beyond the KMT's reach.

Beijing and International Space
--------------


8. (C) The Director noted that China has been working hard
to block Taiwan internationally, for example, recently
pressuring Mexico into denying overflight permission for
President Chen's aircraft. In the future, Beijing will make
it hard for any Taiwan leader to travel internationally, the
Director suggested. Ma said Taiwan would have to negotiate
with the PRC over this issue, an avenue he would pursue if in
power. The DPP and KMT have much in common on the
international space issue and the need for dignity, Ma
acknowledged. Both agree that this is a "sovereign
independent country," Ma stressed, though the KMT defines
that entity as the Republic of China while the DPP, according
to Ma, sees it as the Republic of Taiwan. (Note: The DPP
government does not use the name "Republic of Taiwan." End
Note.)


9. (C) One problem is that China's Foreign Ministry
outweighs the Taiwan Affairs Office (TAO). This is why
Honorary KMT Chairman Lien Chan has spent so much time in
China to try to make Hu Jintao understand that the Taiwan
issue is explosive and that the question of international
space is very important in Taiwan. Ma recalled that last
year he had stated during his March visit to the U.S. that
the Chinese Mainland would have to make a choice between the
Republic of China or the Republic of Taiwan, a choice that
Taiwan also needs to make. Beijing has to face up to the
existence of the ROC, which has its own constitution, Ma
added.

Constitutional Revision
--------------


10. (C) Ma argued that President Chen is trying to equate
the ROC as Taiwan. However, he cannot refuse to recognize
the constitution, which is difficult to change. By leaving
alone the constitution's provisions on sovereignty to avoid
suggestions that he is changing the status quo, President
Chen is showing that he has a better understanding of the
sensitivity of the issue. However, the PRC remains concerned
about calls for a new constitution or a second republic. The
Director stressed that the U.S. does not support changes on
sensitive sovereignty issues that would increase cross-Strait
tensions but does not oppose structural constitutional
reforms to increase government effectiveness. While the U.S.
greatly respects Taiwan's democracy, Taiwan is a special
case. Adhering to the status quo maintains cross-Strait
stability, and sensitive constitutional changes would be very
dangerous, the Director added. He solicited Ma's views on
the matter.


11. (C) Constitutional changes can be debated in the future,
Ma said, but not now. Constitutional changes that were
ratified three years ago to allow single member LY districts
have not yet been realized. After the process is completed
and the new LY comes into office in February 2008, then
potentially it can decide to set up a constitutional reform
committee. Some of the current constitutional reform
proposals are very superficial, Ma observed. For example,
proposals for a parliamentary system do not provide reasons
for why that would be the best system. No system will work
if the government does not respect majority rule, Ma argued.
Taiwan's current constitutional system can work well if the
government respects majority rule. For that reason, Ma said
he had stated that he would probably work with the opposition
to select the premier if it controls the LY and he is
president. Even the DPP understands that the constitutional

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issue is not a priority this year, Ma suggested. Rather, the
people of Taiwan are concerned about the economy and
cross-Strait relations.

Comment
--------------


12. (C) Ma was noticeably more relaxed this time than in our
previous meetings when he was juggling two difficult and
full-time jobs: Taipei Mayor and KMT Chairman. However, Ma
has a hard road ahead this year, as he will have to manage
his own fractious party while at the same time addressing
increasingly stiff challenges from the ruling DPP and its
presidential candidate. This presidential election is
expected to be a close and very toughly fought contest
between the KMT and DPP.
YOUNG