DPP CANDIDATE FRANK HSIEH ON BILATERAL RELATIONS

S E C R E T SECTION 01 OF 03 TAIPEI 002419 SIPDIS SIPDIS NOFORN E.O. 12958: DECL: 10/30/2032 TAGS: PGOV PREL TW SUBJECT: DPP CANDIDATE FRANK HSIEH ON BILATERAL RELATIONS AND PRESIDENTIAL CAMPAIGN Classified By: AIT Director Stephen M. Young, Reasons: 1.4 (b/d) ¶1. (C) Summary: The Director and DPP candidate Frank Hsieh discussed the UN referendum, U.S.-Taiwan and cross-Strait relations, and the presidential election campaign in a meeting at Hsieh's headquarters on October 29. The Director stressed the need to avoid further problems and to take steps to repair U.S.-Taiwan relations. While claiming that the DPP's UN referendum cannot be stopped, Hsieh agreed on the importance of avoiding further steps that could raise cross-Strait tensions. Hsieh pointed to his commitment not to support a referendum on Taiwan independence, noting that he had blocked then-DPP Chairman Yu Shyi-kun's effort to pass a "Normal Country Resolution" calling for just such a referendum. Hsieh stressed he would work to restore bilateral trust if elected president, and he would also seek to open a dialogue with the PRC. On the presidential election, Hsieh said his campaigning will move into higher gear after the Legislative Yuan (LY) election in January, and predicted he will gradually overtake KMT candidate Ma Ying-jeou in the final months of the campaign. End Summary. ¶2. (C) The Director met with DPP candidate Frank Hsieh late on October 29 to brief Hsieh on his recent consultations in Hawaii and to discuss the Taiwan presidential election. Hsieh was accompanied by campaign manager Lee Ying-yuan and international affairs director Bikhim Hsiao. Senior officials in Washington and at PACOM are quite interested in Taiwan developments, including the UN referendum and attitudes of the presidential candidates toward the U.S. and the PRC, the Director noted, adding that they are also focused on PLA modernization. Noting that he recently had a discussion with Deputy Secretary Negroponte, the Director pointed to Negroponte's October 24 speech on U.S.-China relations in New York. In his speech, the Deputy Secretary made clear our non-support for Taiwan independence, U.S. opposition to unilateral acts by either side that attempt to change the status quo, our concern about the PLA buildup opposite Taiwan, and our belief that attempts by Beijing to limit Taiwan's appropriate international participation are unhelpful. ¶3. (C) In disregard of U.S. objections, the Director observed, President Chen seems bent on pressing ahead strongly with the UN referendum to shore up his reputation. He urged Hsieh to draw a line between himself and the President and at least refrain from pushing the referendum enthusiastically. The basic problem is the PRC reaction, the Director stressed, noting, however, that PRC President Hu Jintao seemed less hard-line in his statements on Taiwan at the recent 17th Party Congress than some lower level Chinese officials have previously been. ¶4. (C) Hsieh asserted that the DPP's UN referendum campaign cannot be stopped, noting that the signature drive has already secured between one and two million signatures. Acknowledging that the U.S. enjoys great influence in Taiwan, Hsieh said some people are questioning whether they should support a UN referendum that the U.S. opposes. While the KMT is also proposing a UN referendum, the idea of combining the DPP and KMT referenda has proven unworkable. During his visit to the U.S., Hsieh recalled, he had expressed his commitment not to support a referendum on independence. Because of this position, Hsieh said, he subsequently told President Chen that he opposed then-DPP Chairman Yu Shyi-kun's radical version of the Normal Country Resolution (NCR),which called for a referendum on independence. ¶5. (C) The whole party, not just President Chen, is involved in the UN referendum issue, Hsieh pointed out. Noting that his leg injury has limited his recent campaign activities, Hsieh acknowledged he has been "slow" compared to Chen on this issue. Hsieh suggested that Beijing's strategy is to press the U.S. to use its influence with Taiwan on the UN issue. He predicted that the PRC will not use force over the UN referendum but will wait and see what Taiwan's new TAIPEI 00002419 002 OF 003 president will say after the election. The inauguration of a new Taiwan president on May 20, 2008, will mean a changed situation. ¶6. (C) Hsieh said he had made the argument during a DPP internal meeting on the UN initiative that despite differences, Taiwan and the U.S. share a common view that Taiwan is not part of the PRC and the PRC cannot represent Taiwan. The DPP is traditionally a pro-U.S. party, Hsieh pointed out. It is important that the differences between the U.S. and Taiwan over the UN referendum not be misconstrued as indicating a major conflict between the U.S. and Taiwan. U.S. statements have an effect on Taiwan public opinion, Hsieh added. ¶7. (C) The Director pointed out that Deep Green extremists exacerbate U.S. concerns when they argue that using the name "Taiwan" to apply to the UN supersedes the constitutional designation of "Republic of China" as Taiwan's name. Acknowledging that some Deep Green supporters have voiced such arguments, Hsieh stressed that they and others actually understand clearly that changing the national name requires a change in the constitution. A constitutional change is not feasible for at least the next five years, Hsieh observed, explaining that the political balance in the LY to be elected next January will not allow for such an initiative. The Director urged Hsieh to put off into the very distant future any possible consideration of such issues. ¶8. (C) According to Hsieh, the UN referendum will educate people that the PRC does not represent Taiwan. Without physical occupation, he stressed, the PRC cannot represent Taiwan. Taiwan cannot become independent by passing a NCR, as Yu was suggesting, but only from war. However, Taiwan is a middle class society and has no interest in going to war. Taiwan cannot change the international power structure, and therefore has to survive under the realities of the current international system. ¶9. (C) Noting that the UN referendum was the latest in a series of steps by the DPP administration that have damaged U.S.-Taiwan relations, the Director urged Hsieh to work to avoid any new problems. The question for the future will be how to restore good bilateral relations after Taiwan and the U.S. both elect new presidents. In 2000, the Director recalled, President Chen and the DPP came into office without experience, but this will not be the case in 2008, regardless of who wins the Taiwan election. While respecting Taiwan's democracy, the U.S. also has basic security interests, and we do not want to see democracy and security interests in opposition. Hsieh pledged to work to repair bilateral relations and also suggested that regular meetings to exchange views with the Director would be helpful. ¶10. (C) Hsieh observed that better PRC-U.S. communications seem to have reduced Chinese anxieties about Taiwan, and Hu Jintao appears confident that time is on the PRC's side. Hu wants to highlight economic progress as the major achievement of his second term, and he will not want trouble over Taiwan during this period, Hsieh added. While the PRC will object to the UN referendum, this is not a reason to fight, and Beijing realizes that it cannot win international support for war over such an issue. Beijing is more worried about possible next steps by Taiwan, Hsieh observed, explaining he had blocked Yu Shyi-kun's radical NCR language because he realized that the call for name change would be confrontational. If elected, Hsieh said, his approach to cross-Strait dialogue would be to "keep talking" but not arrive at any conclusion, because a conclusion at this stage would inevitably be unfavorable to Taiwan. ¶11. (S/NF) Asked whether he had any contacts with the Chinese, Hsieh said no, and, pointing to the ceiling, he added that President Chen would immediately learn of such contacts. When mayor of Kaohsiung in 2000 and just before assuming the DPP chairmanship, Hsieh recalled, Beijing had invited him to visit Xiamen. President Chen asked to see him at the time, and Hsieh told Chen he thought he should make TAIPEI 00002419 003 OF 003 the visit. Chen then showed him a stack of National Security Bureau (NSB) reports, according to which the PRC was planning to "use Hsieh to suppress Chen" (LaChang YaBian),and the proposed visit was called off. Hsieh added that the NSB is always quick to prepare a file of reports on anyone President Chen complains about. ¶12. (C) Acknowledging that KMT candidate Ma Ying-jeou retains the lead in current public opinion polling, Hsieh pointed out that the poll numbers in at least some local districts, including Kaohsiung City, are clearly skewed in favor of Ma and need to be adjusted. Hsieh said he uses internal polling to track differences between support for him and Ma on particular issues or characteristics. Hsieh noted that he is just seven percent behind Ma on the economy, adding that his not talking a great deal about the economy is part of his election strategy. The polling category where Ma comes out strongest is "international perspective," where Ma currently is running 30 points ahead of Hsieh (55-20 percent),despite Hsieh's international experience in Japan. Hsieh noted that he comes out stronger in the polls than Ma on "decisiveness." He also said Ma's previously big lead on "integrity" has narrowed somewhat. Hsieh predicted he will eventually beat Ma on this issue because, unlike Ma, he has no "special allowance" problem. Hsieh added that he is not raising this issue now because he does not want the prosecutors to be put under greater pressure. ¶13. (C) Hsieh said he has good coordination with President Chen, with whom he meets privately every week. Chen's enthusiasm is important for stirring up the base. However, Chen is a polarizing figure, and it is not yet clear if certain of his efforts, such as his criticisms of Ma's father, are helpful to the campaign, Hsieh observed. Chen is polite and will listen to him if he complains, Hsieh added. Currently, the media is focused on the battle between Ma and Chen, the outgoing president. Chen and Ma are both filled with resentment against each other, and the two of them should step down together, Hsieh jokingly suggested. The KMT strategy is to try to turn the election into a referendum on President Chen and to make Hsieh vanish, he added. Following the LY elections in January, Hsieh said, he will adjust his campaign strategy and also hold debates with Ma, who does not want to debate him now. At that stage, Hsieh predicted, he will gradually overtake Ma in the polls. ¶14. (C) Hsieh said he does not share the pessimistic views of some that the DPP might win only 30-40 out of 113 seats in the LY elections in January. Having resumed the DPP chairmanship, President Chen can unite the party in ways that no one else, including himself, could do, Hsieh explained. By contrast, the KMT is disunited and lacks the resources it would need to resolve differences on the local level. In addition, Hsieh asserted, KMT Chairman Wu Poh-hsiung lacks the clout to solve the party's problems. Hsieh also predicted that the pan-Green Taiwan Solidarity Union (TSU) will only win two LY districts and not more than three-four seats total, including one or two party list seats. Comment -------------- ¶15. (C) Hsieh seemed relaxed and confident in the progress of his campaign, perhaps believing that Ma is wearing himself down in his ongoing rhetorical battle with the feisty President Chen. Hsieh may be hoping to pick up the pieces after Chen and Ma have damaged each other sufficiently. Hsieh is well known for his debating skills and will be a formidable opponent for Ma when the two begin to engage more directly later in the campaign, Hsieh understands well the difficulties the U.S.-Taiwan relationship currently face and the challenges he would have to address in rebuilding trust if he wins the presidential election next March. YOUNG