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Press Release

Speech by Richard C. Bush Chairman and Managing Director, American Institute in Taiwan to the Kaohsiung Lighthouse Rotary Club January 24, 2002

It is a great honor to speak to you today, in response to the kind invitation of the Kaohsiung Lighthouse Rotary Club. By encouraging and fostering the ideal of service, Rotary Clubs in Taiwan have been an important element of the burgeoning civil society that has become a permanent feature of life in Taiwan. Through Rotary’s global network, you help link Taiwan to the whole world. And your ethic of community service – offering aid to those in need simply because they are your fellow human beings – is an important example to your fellow citizens.

   I would like to talk with you today about the relationship of the United States to Taiwan. That is my usual topic, with a focus on the political dimension. Today, I will certainly touch on politics but wish to have a broader vision, and include a personal perspective.

   Over the past year, there were several important milestones in our bilateral relationship:

> The robust package of weapons systems approved by the United States.

> The transits through the United States by President Chen in May, Premier Chang in September, and Vice President Lu this month. In each case, these distinguished travelers were able to meet privately with Members of Congress, representatives of the Chinese-American and Taiwanese-American communities, scholars, and business executives, and to visit museums and places like the New York Stock Exchange.

> Taiwan’s quick and generous response to the September 11th attacks on the United States.

> Taiwan’s accession to the World Trade Organization.

> The December 1st elections, which again demonstrated the strength and vitality of your
political system.

> The visit to Taiwan this week of Assistant Secretary of Commerce William Lash.

Consistently, the communication between our two sides has been excellent.

   I have come to Taiwan on this trip to express on this occasion the gratitude of the people of the United States for your outstanding contributions after September 11th. These include touching expressions of sympathy, assistance in controlling borders and money laundering, and providing material and financial assistance both to victims in the United States and to desperate people in Afghanistan. I know that Rotary International and its clubs in Taiwan have made contributions to meet the humanitarian emergency in Afghanistan. It is in times of crisis that we learn who our true friends are. And the United States knew from the beginning of this particular crisis where Taiwan stood.

   Even as we make a positive assessment of the last year, I think it is also important to maintain a sense of perspective. But taking the last few decades as our time frame, there has been significant change in Taiwan and US-Taiwan relations and that change has been good.

   With respect to Taiwan itself, I think it is important once and awhile to step back and marvel at what the people on Taiwan have achieved in our lifetimes.

* Fifty-plus years ago, the Nationalist government was retreating to the island, with little hope that a PLA invasion could be stopped. On Taiwan itself, the economy was in bad shape – per capita GDP was less than $200 in current dollars. Relations between the Mainlander government and the native population were tense and hostile.
* Forty years ago, the government was only just beginning to institute policies that would foster export-led growth and growing prosperity for the island’s population. Per capita GDP was still under $200. And in 1958, the armed forces with American help had defended Jinmen against a fierce artillery barrage.
* Thirty years ago, per capita GDP was $320. Martial law continued. And President Nixon made his famous trip to Beijing.
* Twenty years ago, Taiwan was reeling from the shock of US de-recognition and the termination of the mutual defense treaty. Political tensions increased. And the per capita GDP had quadrupled but was still only $1760.
* Ten years ago, per capita GDP had quadrupled again to around $7000. The process of political liberalization and democratization had only just begun. Trade with the mainland was growing but investment was still limited.

   Today, in 2002, Taiwan is a modern, urban, wealthy, middle-class, and increasingly cosmopolitan society with a per capita GDP of over $15,000, a sharp contrast to the poor, rural society that it was fifty years ago. There is a growing economic interdependence with the mainland: two-way trade is around $30 billion and contracted investment exceeds $60 billion. Again, this was unthinkable only fifteen years ago. Most important, Taiwan has a thriving democratic system, where the government is accountable to the public, the Legislative Yuan, and the mass media. This political transformation from the harsh authoritarian system of the past is even more startling than Taiwan’s social and economic modernization, for democratization is not an easy process and it occurred on Taiwan without undermining the island’s stability. It is one of the most remarkable examples of peaceful political change in the last half-century, and a point of reference for the mainland.

   I see this in my own experience. My family lived here in the late 1960s and early 1970s, and one of my sisters went to Taipei American School and lived with an American family. Suddenly, one day, the authorities asked that family to leave immediately because they had had contacts with certain dissidents. When my wife and I lived here in 1975, we observed the sense of foreboding that people here felt when Chiang Kai-shek passed away. We saw the contrast between the deep sorrow that Mainlanders felt about Chiang’s death and the indifference of people in our Taiwanese neighborhood. A few weeks later helicopters lifted people off the roof of the American Embassy in Saigon. In 1983, when I joined the staff of the House Foreign Affairs Committee, one of my first tasks was to work on the case of Annette Lu, who was in jail in connection with the Kaohsiung Incident. Of course, Ms. Lu is now the vice president of your country. She is only one symbol of the liberalization and democratization that occurred on Taiwan over the last two decades, one of the most remarkable examples of political evolution of our time.

   Now I try to remain objective about Taiwan. I am aware that Taiwan faces a serious economic challenge. Identity has been a subject of extended political debate. There is concern about the role of money, corruption, and gangs in politics. These are all serious problems, the problems of any open modern society. By and large, however, they are the consequences of success, not of failure. Because of Taiwan's past achievements, it need not face its current challenges with pessimism.

   The same sense of perspective is appropriate when thinking about our bilateral relationship. During the 1950s and 1960s, for example, it was a case of tongchuang yimeng – same bed, different dreams. On the one hand, the United States and Taiwan were bound by an alliance; on the other, American officials lived in dread that the authorities here might drag us into a war we did not want. During the 1970s, the US rapprochement with the PRC left people on Taiwan deeply fearful that their freedom and survival were at risk, and worried whether the new unofficial structure of relations with the United States would serve Taiwan well.

   Personally, I believe that the relationship between the United States and Taiwan is better today than any time in the last fifty years. Our interests and values are basically identical. We share a commitment to democracy and freedom. Our two economies are complementary, with a dominant focus on leading-edge technologies. Our communications are smooth and substantive. And support for Taiwan in the United States is broad and deep. The arrangements created by the Taiwan Relations Act twenty-three years ago have succeeded beyond anyone’s expectations, and certainly beyond the hopes that people had twenty years ago. There are still challenges to be met, particularly in the economic field, but I think they can be met with a sense of optimism.

   There are a number of reasons why Taiwan and the US-Taiwan relationship are doing as well as they are. Let me just cite a few.

   First is the effort of the people of this island. Over the past fifty-plus years, they have worked hard to build the prosperity that we see today. Taiwan companies, many of them of small and medium size, constantly looked for new opportunities to make money. Sound government policies were important, of course. But without the intelligence and hard work of millions of people, those policies would not have been as successful. And as Taiwan’s economic and social modernization took root, there were increasing calls – and sacrifice – for political modernization as well.

   Second was the decision of President Chiang Ching-kuo to respond to those calls for political change. In the mid-1980s, he made the novel – and correct – judgment that the best way to keep the Kuomintang in power was not to maintain repression but to open up the political system, to allow people to say what they thought, and to permit broader contests for power. President Chiang also understood, I think, that a democratic Taiwan could be a powerful appeal to friendly countries like the United States with which it no longer had diplomatic relations. President Lee Teng-hui continued Chiang Ching-kuo’s mission of democratization, and in the last two years we have had transfers of power in both the presidency and the legislature.
   Third has been change in the PRC, particularly in the economic field. Deng Xiaoping’s policies of reform and opening up created a huge opportunity for Taiwan companies that were facing the pressure of rising labor costs. Taiwan’s prosperity has been sustained by Mainland production platforms. PRC openness has also allowed interchange between the two societies, after thirty years of separation. Of course, China could become an economic competitor rather than an economic partner. Economic links could offer a means of political leverage. China’s military modernization raises questions for both Taiwan and the United States. But there is no denying that, so far, Mainland economic policies have been good for Taiwan.
   Fourth has been the policy of the United States. Washington provided a security umbrella from the beginning of the Korean War. Even after the break in diplomatic relations, the United States continued to provide arms and insist on a peaceful resolution of the Taiwan Strait issue. We had an important impact on your country’s economy – providing substantial economic assistance, prodding the government to pursue export-led growth in the late 1950s, encouraging currency devaluation in the mid-1980s, and facilitating WTO accession in the 1990s. In the 1980s, some Americans signaled that a democratic Taiwan would have a better claim on American support than an authoritarian Taiwan.
The positive impact of American policy continues to this day. Permit me to tick of the key elements.

   First and foremost, there is the fundamental emphasis on peace and an unconditional insistence that the Taiwan Strait issue should be resolved peacefully. This is a long-standing principle of US policy, reaffirmed by every Administration since the 1950s, and certainly by the Bush Administration. This is reflected in the arms sales decisions in April and the President’s statement around the same time. This fundamental emphasis is even stronger because of Beijing’s military modernization.
   A second element of the Bush Administration’s policy is that the United States will continue to follow a one-China policy, as defined by the three US-PRC communiqu?s and the Taiwan Relations Act. Within those parameters we have a rich substantive relationship with Taiwan, seeking cooperation on a wide array of issues on which we have common and parallel interests. Examples of this are our work together on the response to 9/11 and Taiwan’s WTO accession.
   The third element is the important and inescapable fact that Taiwan is a democracy. Given America’s values, that is significant for its own sake. It also means that the United States will treat Taiwan and its leaders with the respect and dignity that is worthy of a fellow democracy. This was most evident in the transits of President Chen, Premier Chang, and Vice President Lu. The Administration was pleased to accord your high officials this respectful and dignified treatment.
   Democracy is important in another way. The Bush Administration believes that any agreement regarding the Taiwan Strait issue, in addition to being reached peacefully, has to be acceptable to the people on Taiwan.
   On cross-Strait relations, and this is my fourth point, the Bush Administration believes that how the Taiwan Strait issue is resolved is up to the two parties concerned. Similarly, the United States favors and encourages dialogue, but has no intention of serving as a mediator in this dispute, or of pressuring Taiwan to negotiate.
   Fifth, the United States believes that Taiwan can contribute to international organizations and should benefit from international organizations. Obviously, this is a sensitive issue, but we worked hard to ensure Taiwan’s becoming a member of the WTO and we do support Taiwan’s participation in the work of international organizations like the World Health Organization. In no way is this position inconsistent with our one China policy. We believe the international community loses if Taiwan is excluded.
In conclusion, Taiwan has made tremendous progress over the last five decades. This has been the result of the hard work of its people and wise policy choices by its leaders. But it has also been the result of the good relationship with the United States. Of course, no democracy is perfect, including that of the United States. Taiwan faces challenges as it seeks to fashion a political system that better reflects the true wishes of the people. Taiwan faces important challenges in reforming its economy and Mainland policy. Yet I think the record of the past fifty years inspires confidence that those challenges can be met. I hope that Taiwan people will approach those challenges with confidence. As they do so, they can be sure that the United States will continue to provide support and admiration.