Wow… the ruling Kuomintang (KMT) party, led by Ma Ying-jeou, lost pretty spectacularly and surprisingly in the mayoral elections held here in Taiwan yesterday to the Democratic People’s Party (DPP), led by Tsai Ying-wen. The issue isn’t so much legislative (it wasn’t a parliamentary / general election) but the signal Taiwan sent by making the ruling party lose control of nearly all major cities/municipalities (Taipei to the “independent” DPP-backed People First Party (PFP), and Taichung, Tainan, Kaohsiung to the DPP) was felt throughout like a political earthquake. This led to the PM resigning, and Ma got under the heat of reporters and criticism not long after.
General elections will be held in the start of 2016, giving the KMT roughly 9/8ths of a year to turn public opinion around unless Ma wishes to be forced to cede power to the DPP, and I expect politics to go into overdrive to provide good results to boost the prospects of re-election.
What has brought this about, given that at least Taipei and Taichung have normally been the industrial / corporate base on which the KMT has stood firm as essentially the rest of Taiwan was sided with the DPP? Ma Ying-jeou has lately been called “Mr. 9%” as a reference to both his low approval ratings (9%) and the “jeou” character in his name which means “9” in Chinese, but even despite this he has managed to score political victories, most notably a reelection in 2012. So, what has changed?
- Worries of economic stagnation. Wages are not increasing in Taiwan, while house prices and rents are going up and reaching stratospheric levels compared to average salaries. There has been discussions on lower economic growth proving to be a massive funk for the island which it has yet to get out of, despite GDP growing at roughly 3.5% for the last 6-9 months and showing signs of increasing.
- Fears of China have increased. Partially, this is because a more assertive Xi Jinping has been playing a lot of tones that ring of nationalism which isn’t the best sound in Taiwanese ears, for understandable reasons. Part of it is normal, Asian irrationality and demands for remaining separated and elevated from China by birthright, which are fears that cannot be placated under any circumstance as long as China is growing faster than Taiwan and steadily opening up.
- Heavy-handedness by Ma. He’s been trying to force a lot of regulation through parliament without broad support, looking more like a CEO responding to owners everyone believes to be Chinese, than a politician genuinely looking out for the Taiwanese people and their interests. “Sellout” is a pretty common slur about Ma these days, or that he’s trying to show progress on unpopular decisions towards a schedule set by Beijing, and the protests in March of this year against the Cross-Strait agreement were probably the standout development in this area. On top of this there have been a few food scandals which obviously, in any lack of perfect handling, gets pinned on the ruling party.
- Voter fatigue. How many rulers in democratic countries get a second renewed mandate? Sweden failed this even though the economy’s been good, the same thing with the US in the last midterm elections even though there has been a lot more controversial policy to go around in that case. Then what are the chances for that happening in Taiwan which is gradually becoming less and less competitive (thanks largely to a very tightly managed currency against the US dollar) while asset prices are soaring?
Here’s what I think needs to be done in the coming ~6 months for Ma to maintain his presidency, which I personally do think is beneficial for Taiwan (both on ideological grounds and as a matter of pragmatism – the “greens” as the opposition is known isn’t a group I think of when someone mentions professionalism and organizational capability). As usual, hit the “Continue Reading” for more!