DPP CONTENDER FRANK HSIEH ON ELECTION POLITICS AND

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 000643

SIPDIS

SIPDIS

E.O. 12958: DECL: 3/21/2032
TAGS: PGOV TW
SUBJECT: DPP CONTENDER FRANK HSIEH ON ELECTION POLITICS AND
CROSS-STRAIT RELATIONS


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


1. (C) Summary: Former Premier Frank Hsieh told the
Director on March 19 that he faces a tough challenge in his
quest to win the DPP presidential primary this spring.
Politicians hoping to become Taiwan's next President in 2008,
Hsieh said, will need to appeal to middle class voters by
proposing sound policies that improve economic development
and promote cross-Strait stability rather than emphasizing
socially divisive issues such as Taiwan independence. During
the DPP primary, however, the need to win some support from
the DPP Deep Green may prove crucial and is pushing all four
DPP candidates to move away from the middle. Hsieh expects
President Chen will continue to play a "decisive" role in the
primary despite his decision to stop mediating among the four
DPP presidential candidates. Hsieh emphasized that the DPP's
political platform is open and positive toward developing
cross-Strait relations and suggested that if elected
President in 2008 he would reinstate the "active opening,
effective management" policy. End Summary.


2. (C) During a meeting with the Director on March 19,
Frank Hsieh (Chang-ting),former Premier and contender for
the Democratic Progressive Party (DPP) 2008 presidential
nomination, noted that Taiwan's rapid economic development
over the past two decades has created a "middle class"
society that wants political and economic stability.
Politicians hoping to become Taiwan's next President in 2008,
he said, will need to appeal to those middle class voters by
proposing sound policies that improve economic development
and promote cross-Strait stability rather than focusing
primarily on socially divisive issues such as Taiwan
independence. Hsieh noted that only about a quarter of
Taiwan's voters are die-hard "political radicals" who support
either the Green or Blue camp, but their voice tends to
dominate the electoral process and they play an important
role during party primaries.

Selecting the DPP's Presidential Candidate
--------------


3. (C) Hsieh told the Director that he has a tough fight
ahead of him in the DPP's presidential primary this spring.
DPP Chairman Yu Shyi-kun, who lags significantly behind Hsieh
and Premier Su Tseng-chang in public opinion polls, has
aggressively sought support from the party's Deep Green base.
Yu's move toward the extreme end has forced all four DPP
candidates to move away from the middle to focus on the
party's base during the primary. As a result, the four
candidates are starting to sound "more and more" the same,
particularly when addressing fundamental issues like Taiwan
sovereignty. Hsieh suggested that Deep Green supporters,
such as members of the Taiwan Society and party elder Koo
Kuan-ming, are clearly backing Yu, but realize he does not
enjoy enough support in public opinion polls (weighted at 70
percent) to win the party primary. To boost Yu's chances,
his supporters have been pushing a proposal to exclude
pan-Blue and independent voters from DPP primary public
opinion polls, in effect trying to change the rules of the
game at the last minute.


4. (C) Hsieh predicted that President Chen will still
continue to play a "decisive" role in the primary despite his
decision to stop mediating among the four DPP presidential
candidates. Chen's influence could be critical in
determining whether to use public opinion polls that exclude
Blue voters in the primary since he controls 3-4 votes in the
party's 15 person Central Standing Committee, which should
make a decision on the issue later this month. Hsieh
assessed that using the filtered polls would most help Yu and
most hurt Premier Su, who has broader appeal among
independent voters.


5. (C) Hsieh suggested that the primary race would likely
go down to the wire because, according to his own internal
polling, he and Su remain neck-and-neck. Hsieh said his
polls also indicate that only a combined Hsieh-Su or Su-Hsieh
ticket has a chance of defeating a KMT ticket led by former
KMT Chairman Ma Ying-jeou. Hsieh confided to the Director

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that if he lost to Su in the primary he would be willing to
serve as Su's vice presidential running mate. Hsieh was
optimistic that a future DPP administration would have a more
substantive division of labor between the president and vice
president than exists now. Hsieh said that, for example, the
future vice president could be in charge of economic policy.
Hsieh predicted that, despite lagging in the polls, Vice
President Lu will slowly gain support as the primary heats up
because of her stature as Vice President and appeal to women
and middle class voters.


6. (C) Hsieh suggested that once the primary is over in May
President Chen's influence will diminish, though he will
continue to weigh in on electoral politics, perhaps enjoying
as much influence as the DPP presidential candidate. Hsieh
told the Director that while Chen cares very much about the
Deep Green wing of the party, he will be reasonable and
understands that the DPP candidate will need to move toward
the middle to appeal to independent and light Blue voters in
order to win. Hsieh said that the Deep Green, seeing the
disarray within the KMT after KMT Chairman Ma's resignation,
underestimates Ma and maybe willing to back a Deep-Green
candidate such as Yu out of the belief that any pan-Green
challenger can defeat a weakened KMT. Hsieh observed that
Ma, despite his legal troubles, is likely to win his party's
nomination. Legislative Yuan Speaker Wang Jin-pyng's only
chance is if a conviction for corruption materializes in time
to preclude Ma from running in the presidential race.

Taiwan Identity & Ethnic Tensions
--------------


7. (C) Hsieh believes Taiwan identity continues to be a
sensitive, hot-button issue in Taiwan politics because voters
are uncertain about the island's future vis--vis China.
Green politicians tend to play upon those fears, especially
during election time, to highlight the DPP and KMT's opposing
stances on Taiwan's future. Hsieh noted that this is
particularly so when the "ethnicity" of the KMT candidate can
become an issue in the election even though the next
generation of ethnic "mainlanders," including Ma, have all
grown up on Taiwan and largely identify with the island. The
recent electoral successes of ethnic mainlanders in northern
Taiwan have heightened these anxieties among some in Taiwan,
contended Hsieh, giving the DPP an opportunity to strike a
chord with the 70 percent of the population that identifies
itself as ethnic "Taiwanese."

DPP Platform & Taiwan Independence
--------------


8. (C) Hsieh emphasized to the Director that the DPP's
political platform has been very open and positive in its
stance toward the PRC. Hsieh noted that in 1999 the party
formally changed its stance from advocating Taiwan
independence to stating that Taiwan is already an
independent, sovereign country that should seek to
"normalize" its foreign relations. Hsieh also said that
during his tenure as party Chairman (2000-2002) he promoted
the policy of "active opening, effective management," which
was adopted by the administration but then later reversed by
President Chen in 2005 in response to Deep Green concerns.
Hsieh charged that the "radicals" within the party who
continue to push for Taiwan independence are therefore
actually in violation of the party's proclaimed political
beliefs. Hsieh said that these fundamentalists are driven by
their belief that the DPP needs to take a more
confrontational position toward China and can risk creating a
more distant relationship with the U.S.

One-on-One Discussion
--------------


9. (C) During a brief one-on-one with Hsieh at the end of
the session, the Director underscored the seriousness with
which we view any attempts to alter the status quo across the
Taiwan Strait by either side, and in particular recent
remarks by President Chen raising questions about his
commitment to the "four noes." While our public response was

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relatively restrained, privately we will be making clear that
this could seriously damage bilateral ties if allowed to
continue drifting in the direction of direct violation of the
"four noes." Anything that touches on sensitive sovereignty
issues in the areas of constitutional reform, referenda or
attempts to enter the United Nations under the name of Taiwan
would constitute such a violation. We admire Taiwan's
democratic processes, and understand the domestic factors
currently at work as the DPP seeks to enhance its prospects
in upcoming legislative and presidential elections. The next
couple of months will be closely watched for any signs that
Taiwan might be drifting toward long-established "red lines"
on cross-strait ties. We have made and will continue to make
representations to Beijing on its military buildup and other
developments of concern, but Taiwan has direct
responsibilities of its own here. How these matters are
managed will help to define prospects for U.S.-Taiwan
relations in the future, including with Taiwan's next
president. The Director wanted Hsieh to understand USG views
clearly. He noted he would also make these points in a
meeting later that day with Premier Su Tseng-chang.


10. (C) Hsieh listened closely to the Director's points and
nodded his understanding at several points. He said that
maintaining a strong U.S.-Taiwan relationship was very
important to Taiwan and emphasized that he understood the
importance of not taking provocative steps that jeopardize or
undermine that relationship. Hsieh told the Director that in
upcoming public primary debates he plans to emphasize the
importance of maintaining a good relationship with the U.S.
for Taiwan's future prosperity and stability, but noted that
given his audience he would have to be careful not to "go too
far." Hsieh also stated that should he become president he
would also place a strong emphasis on improving ties with
Japan, which behind the U.S., is Taiwan's next most important
relationship.

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


11. (C) Hsieh combines the characteristics of a
cosmopolitan thinker and grassroots politician. After
Premier Su, he appears to have the next best chance at
winning the DPP's presidential nomination. While Hsieh
revealed his discomfort with moving away from the political
center and being boxed in by the Deep Green base, he appears
to see this as a necessary tactical shift to win his party's
primary rather than a long-term substantive change to his
previous policy stances.
YOUNG