Taiwan – Dr Arthur Chesterfield-Evans

29/04/2021

One China or Two?

29 April 2021

The One China policy was basically the recognition of reality. Mainland Communist China won the revolution in 1949, and when China got its economic act together the world needed to trade with it as it was far more economically significant than Taiwan.

Chiang Kai-shek, the Kuomintang leader, was defeated by Mao Tse Tung and fled to the island that had previously been called Formosa, now Taiwan. He maintained the idea that he would lead a counter-revolution, so there was One China. This counter-revolution became increasingly ridiculous with time, but was not abandoned. The Communists claimed Taiwan and treat it as a rebel province, and they stated that there is One China and that the price of trading with them was to have Taiwan excluded from the UN and other international bodies. That has been the situation for many years, and almost all countries accepted the One China policy, and stopped recognising Taiwan, even if they traded with it.

By definition, if there is One China, who governs Taiwan is an internal Chinese matter. We may not like what China does in Hong Kong, with the Uighurs or in Taiwan, but it is the US that has accepted the One China policy for years.

After WW2 at Bretton Woods it was assumed that free trade would allow countries that were competitive to rise, and those that were not competitive to fall. This was so that there would not be war over markets. But the system that the West set up gave an advantage to countries with lower wages, and if they were smart enough to get the fruits of their labour rather than stay as colonies with foreigners owning their industries, they rose. So China rose and is now a world power and the US are now seeking to intervene in Taiwan and re-create a two-China policy. One can hardly expect China to accept this massive loss of face.

The assumption was that Taiwan would eventually solve its differences with mainland China peacefully. After recent events in Hong Kong, this has become less likely in the short and medium term, but is still viable or even inevitable in the long term, which has always been China’s position.

China has done some sabre-rattling with flights over Taiwan and obviously the recent events in Hong Kong have made everyone nervous.

This article looks at the similarities of the Chinese way of doing business to capitalism. It could be said that the model of an intelligent government cooperating with industry is more successful than a few large industries competing. Competition works if there are many small producers competing in a market. When there are a few oligopolies using trademarks or patents to make more money and not to share knowledge, the old adage that ‘private competition is the best way to run things’ starts to break down. It may not just be cheaper wages that is allowing China to out-compete the US.

Starting a war because you are losing the peace seems a very unwise course of action.

Australia has to stop being the US lapdog. We are not taking the right path.

“Americans Don’t Know How Capitalist China Is” An interview with Weijian Shan

01/01/2021

China and the Taiwan Question. 1/1/21

As China increasingly decides to assert its status as a World Power, Australia has been given the message fairly clearly.

Morrison foolishly, and perhaps encouraged by Trump in his pre-election hubris, criticised China’s management of the Coronavirus. If China was looking for a middle-sized power to humiliate using its Trade power, Australia had stepped conveniently stepped into the role. This is still playing out. If China squeezes hard, we are likely to have a recession and Morrison will lose the election. If not, probably not.

China is asserting its dominance over the South China Sea by building bases on the Spratly Islands, and the US and Australia are sailing through them to show that they still can, but this does not prove that the balance of power is not shifting quite dramatically China’s way.

China has asserted that it is not a democracy and that the Communist party will be dominant for the foreseeable future. It did not tolerate independence in Tibet, nor with the Uighurs, and most recently with Hong Kong, moving to crush local democracy, lest anyone else in China get ideas. The democracy activists in Hong Kong who tried to escape to Taiwan by speedboat were caught, tried and imprisoned (ABC News 30/12/20).

Taiwan, which had an indigenous population as Formosa, became Taiwan, when Chiang Kai-shek, the pro-US, Nationalist loser of the Chinese Revolution fled there with 2 million Chinese in 1949. Their safety at that time was guaranteed by the US Navy and their economy benefitted mightily from the Korean War (1950-53), where they industrialised to manufacture goods for the US war effort. The US has effectively guaranteed their separateness from China. China has never accepted that Taiwan is a separate country, regarding it as a renegade province that will eventually return to China by negotiation. Taiwan agreed that there was One China, as it intended to overthrow the Communists and re-establish their Nationalist government. This has become increasingly unlikely and is now at the point of absurdity, but political parties that are pro-reunification with the mainland have been doing quite badly in Taiwanese democratic elections. The Taiwanese population enjoy both democracy and relatively high incomes. They are naturally concerned with events in Hong Kong, as they are the next domino.

If China wanted a military victory and to assert its new Great Power status moving across a short strait into its own backyard would seem the logical step, and it is doubtful that the US would have the capacity to prevent this, even if it had the will.

Frankly, Australia has to accept the reality that China has arrived at great power status. We cannot get involved in a war over Taiwan. We should take a more neutral position between the US and China, and think in terms of more intelligent trade bargaining and not selling out our assets to foreign powers of any colour.

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