Taiwan is a modern miracle. In less than 40 years Taiwan transformed itself from a military dictatorship into a vibrant democracy and moved from poverty to prosperity. And it did so while under continuing military threat from China and with virtually no natural resources. Nonetheless, it achieved enormous economic, political, social, and technological success, largely through the native intelligence, education, and hard work of its people.
Taiwan’s Place in the World
Overshadowed as Taiwan is by the enormous Chinese mainland, most people are unaware of Taiwan’s success, are ignorant of its history, and underestimate its importance. Some Americans even confuse Taiwan with Thailand. Nonetheless, although small compared to China, Taiwan ranked in 2015 as the country with the 22nd largest GDP in the world in total purchasing power parity (PPP) terms. On a PPP per capita basis, which is generally regard as the best measure of an economy’s comparative strength, Taiwan ranked 29th, placing it just behind Germany (28) and ahead of Canada (32), France (38), the UK (39), Japan (42), and Israel (55). (Rankings are taken from the online CIA World Factbook.)
Other global rankings are also evidence of Taiwan’s success. In the Heritage Foundation’s Index of Economic Freedom for 2016, Taiwan ranks 14th, ahead of Germany (17), Japan (22), South Korea (27), Israel (35), France (75), and China (144). In the Global Economic Forum Competiveness Report for 2015-16, Taiwan ranks 15th, ahead of Belgium (19), Australia (21), France (22), South Korea (26), Israel (27), and China (28). In the World Banks’s 2016 “Ease of Doing Business” rankings, Taiwan earned 11th place, ahead of Australia (13), Canada (14), Germany (15), Israel (54), and China (84). And in the UN-initiated annual World Happiness Report for 2016, Taiwan ranked 35th out of 157 countries, ahead of Spain (37), Italy (50), Japan (53), South Korea (58), and China (83).
Taiwan is a key link in global supply chains, particularly in information and communications technology, and it is a world leader in semiconductors, flat panel displays, and software development. It is also a major U.S. trading partner. As of the end of 2015, Taiwan ranked 9th in two-way trade with the United States, according to the U.S. Census Bureau, outranking even huge India, and Taiwan was the 8th largest market for U.S. food and agricultural products, according to the U.S. Department of Agriculture.
An Evolving Democracy
A strong and still evolving democracy, Taiwan has held six free and fair presidential elections since 1996 and the political parties holding the presidency have changed three times. It enjoys a first-rate national health care system, excellent universities, and a very low crime rate. Taiwan is in fact precisely the kind of democracy the United States has spent far more treasure and blood futilely trying to nurture in Iraq, Afghanistan, and elsewhere. Taiwan therefore has tremendous symbolic importance as a model of democratic transformation for Asia and the world. While relatively small in land area, Taiwan is still bigger than 46% of world’s nations and territories, and its population of some 23.4 million people is actually larger than nearly 78 percent of the world’s 238 countries and territories.
Despite Taiwan’s extraordinary achievements, some commentators, faced with the threat of an increasingly powerful China, have argued that Taiwan is not worth continuing U.S. support given the possibility of military conflict over the island nation that China claims as part of its territory. Australian academic Hugh White, for example, has argued that “China is simply too important economically, and too powerful militarily, for anyone to confront it on Taiwan’s behalf, especially when everyone knows how determined China is to achieve reunification eventually.” We can imagine, however, White’s reaction should Australia, a U.S. ally and democracy with a slightly smaller population than that of Taiwan, become the target of China’s ambitions.
The Security Equation: China
Such arguments dismiss not only Taiwan’s importance as an economically successful democracy, but also underestimate its geostrategic significance at the center of the East Asian Pacific Rim. As early as 1950, Gen. Douglas MacArthur stressed the strategic importance of Taiwan (or as it was then called, Formosa) in an effort to persuade the Truman Administration not to abandon the Republic of China on the island for the sake of improved relations with Beijing. MacArthur wrote that “Formosa in the hands of the Communists can be compared to an unsinkable aircraft carrier and submarine tender ideally located to accomplish Soviet offensive strategy and at the same time checkmate counteroffensive operations by the United States Forces based on Okinawa and the Philippines.”
Although it was the Sino-Soviet Treaty and North Korea’s invasion of South Korea later in 1950 that changed Truman’s thinking, both Chinese and U.S. military planners continue to recognize the enormous strategic military significance of Taiwan. Control of the seas along the Pacific Rim requires control of the first island chain, which reaches from Japan through Taiwan to the Philippines. Taiwan is the central and critical link in the chain. Over time, Chinese military ambitions have expanded to include the projected ability to dominate the sea out to the similarly U.S. controlled second island chain, some 1,800 nautical miles beyond China’s coast.
China’s control of these island chains would enable China to dominate the major sea-lanes of commerce and communication for Japan and Korea, as well to gain enormous leverage in territorial disputes, not only over Taiwan, but also in the South China Sea. Control of these waters has offensive as well as defensive dimensions. Reaching from Singapore and the Strait of Malacca in the southwest to the Taiwan Strait in the northeast, the South China Sea is one of the most important energy and trade routes in the world. Almost a third of global crude oil and over half of global liquefied natural gas (LNG) pass through the South China Sea, and it carries an equally enormous volume of commercial trade, according to the U.S. Energy Information Agency. In addition, according to Robert Kaplan in Asia’s Cauldron: The South China Sea and the End of a Stable Pacific, “More than half of the world’s annual merchant fleet tonnage passes through these choke points [the Malacca, Sunda, Lombok, and Makassar straits], and a third of all maritime traffic worldwide.
China: The Broader View
If China controlled both Taiwan and the South China Sea, it would in effect control the entire Pacific rim of East Asia, and the smaller countries along China’s periphery would have little choice but to become subservient tributary states of China or to suffer the consequences of disobedience. Thus, it is not hard to see why People’s Republic of China domination of both Taiwan and the South China Sea are part of President Xi Jinping’s Chinese “dream.”
Taiwan’s loss of de facto sovereignty would therefore also undermine the entire U.S. alliance system in Asia and other Asian military partnerships that have maintained the peace, stability, and increasing prosperity that East Asian countries, including China, have enjoyed since the Korean War. This is why most Asian countries have welcomed President Obama’s “pivot to Asia,” and why there is increasing military cooperation among India, Vietnam, Japan, Australia, Singapore, and the Philippines, and with the United States.
The U.S. commitment to freedom of navigation in the South China Sea and continued U.S. support for Taiwan as defined in the 1979 Taiwan Relations Act are the “canaries in the coal mine” for our allies. Should the United States falter in these commitments, our allies’ confidence in the United States would evaporate. The only alternative to Chinese subjugation for Japan and South Korea might be the development of nuclear weapons, already an issue broached by leading politicians in Seoul.
Unfortunately, Washington’s attention to these fundamental U.S. interests has been inconsistent at best over the past 37 years as U.S. administrations, both Republican and Democratic, continually pursued the ever receding illusion of friendly and cooperative relations with China. U.S. policy toward China has in fact been based on a series of mistaken or shortsighted assumptions, including:
- The geostrategic argument that improved relations with China would serve as leverage against the Soviet Union (and also end the war in Vietnam more quickly) ultimately proved wrong. Among the closest political and military partners in the world today, China and Russia cooperate against U.S. interests in the UN Security Council and elsewhere and hold regular joint military exercises.
- The anticipated concrete policy benefits of Sino-U.S. cooperation are hard to find. For example, the Six Party Talks on North Korean proliferation yielded no lasting results, and the PRC has consistently weakened or not enforced sanctions against North Korea. Despite Beijing’s insistence on unification with Taiwan, it opposes reunification of the Korean peninsula. Beijing signed the Iranian nuclear agreement, but a U.S. government official publicly stated in 2015 that China has not demonstrated “the necessary capability and will” to stop its illicit transfers of sensitive technology to Iran.
- The economic argument that trade with China would lead to a more transparent and open society based on the rule of law proved false, especially after Xi Jinping came to power.
- The argument that trade with China would benefit the U.S. economy depends on who you ask – those few business sectors that have profited; the American workers who lost manufacturing jobs to China rather than a more benign alternative; or the disaffected American business people who for several years running have reported to AmCham Beijing the increasing problems and discrimination they face in doing business with China.
While exaggerating the potential gains of the U.S. relationship with China and our common interests, Washington has underestimated or ignored Taiwan’s potential as a developing democracy and strategic partner, as well as our shared values and interests. Washington also underestimated the growing threat from China. As PRC military power and the ability to project it have rapidly expanded, so too has the aggressiveness of its posture toward its neighbors intensified. The building of artificial islands in the South China Sea and their militarization is the most glaring evidence of Beijing’s increasingly belligerent posture.
The Taiwan Relations Act
Meanwhile, Washington has consistently failed to meet its obligations under the Taiwan Relations Act to “make available to Taiwan such defense articles and defense services in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense capability.” While it is true that the United States is the only country in the world that openly continues to sell weapons to Taiwan and to provide military training and advice, it has done so in a very carefully calibrated way designed not to upset China too much. As a result, Taiwan’s defensive capacity is now inadequate.
This is not to deny that Taiwan itself bears some responsibility for the overall decline in its military capability relative to China. Even though in 2001 President George W. Bush approved the possible sale of diesel-electric submarines, the Kuomintang Party-led legislature in opposition to then President Chen Shui-bian (2000-2008) blocked the necessary funding. Subsequently, despite President Ma Ying-jeou’s election pledge to devote 3% of GDP to defense, defense spending declined during his two terms (2008-2016) as he argued that the best defense for Taiwan was improved cross–Strait relations. Despite Ma’s effort’s efforts to forge a better relationship with China, the PRC military build-up continued, including more missiles aimed at Taiwan and military exercises for an amphibious assault against Taiwan.
The Broader Perspective
Nonetheless, it is in the U.S. interest to ensure Taiwan’s security, especially following the election of President Tsai Ing-wen, who now speaks publicly about the need for defense for the purpose of “deterrence.” Unfortunately, in the run-up to this year’s U.S. presidential election, the only candidate who addressed the issue of Taiwan was Senator Mario Rubio who in a November 2015 statement said: “In the face of Chinese coercion, the United States must reassert its commitment to Taiwan’s security… Taiwan’s continued existence as a vibrant, prosperous democracy in the heart of Asia is crucial to American security interests there and to the continued expansion of liberty and free enterprise in the region. We must do more to help Taiwan counter the growing military threat from China.”
Recognizing that military defense is only one aspect of security, Senator Rubio added, “instead of focusing on petty bilateral trade disputes, the United States should be pushing for Taiwan’s eventual inclusion in additional international organizations and trade agreements…. Taiwan is one of America’s oldest and most steadfast security partners. We need to work together to pursue our common interest in an Asia that is prosperous, peaceful, and free.”
Ironically, however, Taiwan had a stronger lobby in Washington and stronger overall American support when it was a military dictatorship under Generalissimo Chiang Kai-shek. This must change. Fortunately, there have recently been some positive signals to Taiwan. In March, President Obama signed legislation that requires the U.S. Secretary of State to develop a strategy to help Taiwan gain entrance into INTERPOL. In May, Congress passed a concurrent resolution reaffirming the 1979 Taiwan Relations Act and President Reagan’s 1982 “Six Assurances” to Taiwan as cornerstones of U.S.-Taiwan relations.
Although these are important symbolic signals, we must do more. Taiwan needs and deserves the kind of widespread popular support and policy commitment that underlies the U.S. relationship with Israel. Like Israel, Taiwan is a small but prosperous and technologically advanced democracy – in a strategically important and sensitive location – that remains under continuing existential threat.
William A. Stanton, Ph.D. is Director of the Center for Asia Policy at National Tsing Hua University.