IV. Political Environment Over the past few years Taiwan has moved rapidly from a single- party, authoritarian political system to a more democratic system. Martial law, which had been in force since the 1940's, was lifted in 1987. Taiwan's first democratically elected legislature was elected in December, 1992. The democratization process is continuing with the first direct elections of the Mayors of Taiwan's two largest cities (Taipei and Kaohsiung) and the Governor of Taiwan Province scheduled for the end of 1994. These officials were previously appointed by the central authorities. Taiwan's pentapartite constitutional system divides the government into five branches or Yuans. The five branches are the Executive Yuan, the Legislative Yuan, the Judicial Yuan, the Control Yuan and the Examination Yuan. At the top of this structure is a President, who is chosen by a National Assembly. Although Taiwan has progressed rapidly toward full democracy, the Kuomintang (KMT, or Nationalist party), which ran the previous authoritarian government on Taiwan, still has most political power on the island. The KMT has a two-thirds majority in the law-making Legislative Yuan (LY), and completely controls all of the other Yuans, including the administrative agencies in the Executive Yuan. The President, who is chosen by the KMT-controlled National Assembly, is also the Chairman of the KMT. Intense factional fighting within the KMT limits the Party's ability to take full advantage of its politcial dominance, but when push comes to shove the KMT can still muster the votes and the muscle to accomplish what it wants. The main opposition party is the Democratic Progressive Party (DPP). For much of its existence, the DPP was devoted almost solely to opposition: they were for whatever the KMT was against and against whatever the KMT was for. This included the extremely controversial issue of Taiwan independence. The KMT has consistently maintained that Taiwan is part of China and that the authorities on Taiwan -- the "Republic of China" -- are the rulers of all China. The DPP was originally associated with the Taiwan independence movement, but as the party has matured it has taken its demand for immediate Taiwan independence out of its platform. Although the DPP does not have any executive power and is not closely associated in the voters minds with any specific economic ideology, the DPP has staked out a generally populist position of concern for the environment and concern for working people -- as opposed to the KMT's alleged preference for the interests of big business and the state. Politics in Taiwan, like politics anywhere, is extremely difficult to summarize. Issues tend to be intensely local and inextricably bound up with the personalities and ambitions for the individuals involved. One way of trying to make sense of this complexity is to examine some of the issues in terms of the tensions between opposing trends or tendencies. This dialectical approach does not completely explain Taiwan politics, but it does provide a framework for examining disparate trends and events. Although it is tempting to assign a position in support of one side of the dialectic to the KMT and the other side to the opposition, the situation is not that simple. Take, for example, the Taiwan/Mainlander issue. The KMT, which brought its political power and two million people over from Mainland China in 1949, is generally associated with the Mainlanders (people who fled to Taiwan with the KMT and the descendents of those people); the DPP with the Taiwanese (ethnic Chinese who immigrated to Taiwan before 1949, mostly from Fujian Province). Yet many of the people in the KMT, including the President, are ethnic Taiwanese. One of the factional struggles in the KMT is between the old guard "anti- mainstream" mainlanders and "mainstream" Taiwanese. A new opposition party, consisting mainly of "mainlanders" who have grown up in Taiwan, has broken off from the KMT. Another important debate in Taiwan politics is the battle between economic development and environmental protection. Although many people argue that these two goals are not mutually exclusive, opponents and proponents of many proposals in Taiwan tend to frame the debate in black and white terms. Residents of a town in southern Taiwan surround the industrial park that pre-dates their town and demand that the plants pay compensation for the pollutants they have allegedly emitted. Businessmen beseach the LY and the Taiwan EPA to losen environmental standards that they claim are harming their international competitiveness. Another interesting struggle that is having a major impact on business in Taiwan is the pull between localism and centralism. Traditionally, political power in Taiwan has been concentrated at the center. Although local governments exist, they have few powers of taxation and hence must rely on the central authorities for financing. Localities have also had little flexibility to differentiate themselves from other localities. As Taiwan has become more democratic, however, local politics have become increasingly important. One local Mayor has begun levying "fees" on local businesses -- fees which the central authorities have claimed are illegal taxes. Other localities have -- over the objections of the central authorities -- shut down a foreign Taiwan joint venture that was illegally operating a retail business on land zoned for industrial use. Although power is still heavily concentrated at the center, local politicians are pushing for a greater role in governing their localities. The defining characteristic of Taiwan's international relationships is the authorities lack of diplomatic ties with most nations of the world. The ruling authorities on Taiwan call their administration the "Republic of China," and for many years claimed to be the legitimate government of all China. Foreign nations wishing to establish diplomatic relations with the government of China had two choices: to recognize the "Republic of China" (ROC) which controls Taiwan, or to recognize the "People's Republic of China," which controls the rest of China. Most chose to recognize the PRC. The U.S. switched recognition from the ROC to the PRC in 1979. The Taiwan authorities have recently backed away from their stance of insisting that they are the legitimate rulers of all of China. While still admitting that Taiwan is part of China, they seek recognition of the fact that there are now two legitimate political entities in China -- the PRC and the ROC on Taiwan. Under this policy, the authorities are seeking to join international organizations -- most prominently the United Nations and GATT. The authorities have floated trial balloons in the local press about the possibilty of the new Government of South Africa maintaining that nations long-standing diplomatic ties with Taiwan while established diplomatic relations with the PRC -- dual recognition. The problem with this scenario is that the PRC vigorously thwarts any attempt by the authorities on Taiwan to establish themselves as a legitimate political entity -- even if South Africa and Taiwan could agree on a formula for dual recognition, the PRC would almost certainly reject it. For many years two of the few things the PRC and the authorities on Taiwan could agree on was that there was only one legitimate government of all of China and that Taiwan is part of China. The authorities on Taiwan would now like recognition that there are two "political entities" in China. China sees this as a step toward Taiwan independence and is resisting this push strongly. When and how this situation will resolve itself the subject of much informed speculation but the bottom line is: no one knows. Although the United States does not have diplomatic relations with the authorities on Taiwan, the U.S. - Taiwan relationship is generally excellent. The U.S. is Taiwan's largest trading partner, largest military supplier, most popular overseas destination (outside of Mainland China), favorite destination for advanced training. It is taking both sides some time to get accustomed to the effects of Taiwan's democracy on the relationship -- centralized, authoritarian states are easier to negotiate with and politicians often find that attacking foreigners makes for good press -- but the basic relationship is amiable and mutually beneficial.