MEDIA REACTION: U.S. ECONOMIC SLOWDOWN

UNCLAS AIT TAIPEI 000130 SIPDIS SIPDIS DEPARTMENT FOR INR/R/MR, EAP/TC, EAP/PA, EAP/PD - NIDA EMMONS DEPARTMENT PASS AIT/WASHINGTON E.O. 12958: N/A TAGS: OPRC KMDR KPAO TW SUBJECT: MEDIA REACTION: U.S. ECONOMIC SLOWDOWN Summary: Taiwan's major Chinese-language dailies continued to focus news coverage January 26-28 on the upcoming presidential election and Taiwan's UN referendum; on the Cabinet's en masse resignation and possible cabinet reshuffle; and on the controversy over China's new air route west of the central line of the Taiwan Strait. Both the pro-unification "United Daily News" and the centrist, KMT-leaning "China Times" carried the results of their latest opinion surveys on January 27, which indicated that supporters of the pan-Green have returned to the fold, and the gap between the KMT's Ma-Siew ticket and the DPP's Hsieh-Su ticket has narrowed. In terms of editorials and commentaries, an op-ed in the mass-circulation "Apple Daily" discussed the U.S. economic slowdown and asked if the era featuring U.S. hegemony has come to an end. An editorial in the pro-independence, English-language "Taipei Times" also chimed in, urging both the private and public sectors to "consider some countermeasures in the event of a looming US recession or global downturn." End summary. A) "Has Our American Dream Come to an End?" Sisy Chen, a TV talk show hostess and commentator, wrote in her weekly column in the mass-circulation "Apple Daily" [circulation: 520,000] (1/26): "... It's not until the [explosion of] the sub-prime mortgage crisis this time that we were forced to stop at a certain point in time to ponder on a serious issue: Namely, has our American dream already come to an end? ... The era of uncertainty for mankind has arrived again. For the past century, we have constantly been dominated by concepts coined by and standing for the United States. Yet when human society is likely moving toward a new destination, where the old hegemony is declining rapidly but a new hegemony is yet to take shape, human beings are not necessarily prepared for a generation without U.S. hegemony. It is an obvious trend that the world will develop into a center shared by multiple powers, and the balance originally sustained by the five major centers -- the United States, China, Russia, Europe and Japan -- is vanishing. No single individual is able to control or generate the speed for these powers that navigate through the perpetual flow of time. The U.S. economic slide in 2008 and the transformation of the Chinese market starting from the second half of 2007 are evident proofs showing that no one can control or anticipate such changes. "It may not be a good development without U.S. hegemony; the collapse of [economic] confidence will remain in the [global] market for at least a long period of time. But the absence of U.S. hegemony may not necessarily be a bad thing either; at least in a short period of time there will not be a hegemony that will willfully create any excuse to start a war like the one in Iraq. The era in which the United States monopolizes power has come to an end after all, and a new era that we are yet unable to imagine is now taking shape. ..." B) "Can Taiwan Weather the US Storm?" The pro-independence, English-language "Taipei Times" [circulation: 30,000] editorialized (1/28): "... No one knows exactly how a slowing US economy would affect consumer spending there and to what extent a slowdown would drag down the world economy. But a global downturn is inevitable and no one is immune, not even China or India. The situation can also become worse if the US government's US$150 billion economic stimulus package fails to kickstart the sagging US economy or the US Federal Reserve's emergency interest rate cuts last week fail to revive its economy. The US problem, as suggested by billionaire George Soros in an article published last week, is actually associated with a systemic problem -- an exploding credit expansion without regulatory checks. "The downside risk is greater and may have come earlier than expected. Taiwan's export sector will face more challenges this year as the economies in Europe have already started cooling down. Several computer and electronics makers will begin this week to report their fourth-quarter earnings and their prospects for the coming months. The government is also scheduled today to release its monthly index of leading economic indicators, a key measure of the economy's direction over the next three to six months. Both private and public sectors should consider some countermeasures in the event of the looming US recession or global downturn." YOUNG