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Cablegate: Southern Taiwan Dpp "Young Turk" Insists Dpp Political

VZCZCXRO7944
PP RUEHCN RUEHGH
DE RUEHIN #1044/01 1980631
ZNR UUUUU ZZH
P 160631Z JUL 08
FM AIT TAIPEI
TO RUEHC/SECSTATE WASHDC PRIORITY 9519
INFO RUEHBJ/AMEMBASSY BEIJING 8455
RUEHGH/AMCONSUL SHANGHAI 2160
RUEHCN/AMCONSUL CHENGDU 2777
RUEHSH/AMCONSUL SHENYANG 6735
RUEHGZ/AMCONSUL GUANGZHOU 1346
RUEHHK/AMCONSUL HONG KONG 9678

UNCLAS SECTION 01 OF 03 TAIPEI 001044

SIPDIS

SENSITIVE

DEPT FOR AIT/W, EAP/TC, INR/EAP

FROM AIT KAOHSIUNG BRANCH OFFICE

E.O. 12958: N/A
TAGS: PGOV TW
SUBJECT: SOUTHERN TAIWAN DPP "YOUNG TURK" INSISTS DPP POLITICAL
FORTUNES ON THE RISE

SENSITIVE BUT UNCLASSIFIED, PLEASE PROTECT ACCORDINGLY

1. (SBU) Summary: In his July 9 meeting with DIR, popular DPP
Kaohsiung County Magistrate Yang Chiu-hsing praised new DPP Chair
Tsai Ing-wen despite some drawbacks and predicted DPP gains in 2009
county and mayoral elections. Lamenting the last two years of
President Chen's administration as a lost opportunity, Yang derided
Chen's public obsession with Taiwan sovereignty issues but suggested
Chen could reemerge as a political force if the courts cleared him
of corruption charges. Yang criticized the new KMT administration's
tilt towards the PRC, commenting that Ma's government was
overestimating the economic impact of direct cross-strait links and
Chinese tourists. Yang remained coy about his own future plans
after he completes his final term as magistrate, but some local DPP
contacts hope Yang will run for Kaohsiung City Mayor if current
Mayor Chen Chu's fragile health falters. End Summary.

Magistrate Yang: DPP "Young Turk"
----------------------------------

2. (SBU) During his July 9 visit to Kaohsiung, DIR Young met with
DPP Kaohsiung County Magistrate Yang Chiu-hsing, considered one of
the leading "young turks" of the DPP's post-President Chen Shui Bian
generation. Known for his energetic governance and passion for
environmental causes, Yang has earned poll ratings among the highest
of any major DPP elected official island-wide. Although personally
committed to the DPP's "Taiwan identity" focus, Yang in public has
cut a more centrist figure, for example strongly supporting the less
strident Tsai Ing-wen as DPP party chair as the most effective
strategy for the DPP to recoup its lost power. Yang will finish up
his second and final term in December 2009 and is being touted as a
possible DPP candidate elsewhere in southern Taiwan, including for
the 2010 mayoral seat in next-door Kaohsiung City, if DPP incumbent
Chen Chu opts out.

DPP in 2009: Rising Fortunes
-----------------------------

3. (SBU) In his meeting with DIR, Yang insisted that the DPP's
fortunes were on the rise. New DPP Chair Tsai Ing-wen was well
placed to reinvigorate the DPP, he explained, because she was
relatively young, not beholden to any faction and experienced in
government. Furthermore, her clean reputation would attract
moderate and young voters that had tilted towards the KMT in March's
Presidential election. Her main drawbacks were limited ties to the
party (she joined the DPP just four years ago), a lack of campaign
experience and insufficient time spent at the grass roots. Yang
applauded Tsai's efforts to refill depleted party coffers and
promised that the DPP in Kaohsiung County would meet its fundraising
quota.

4. (SBU) Yang predicted that rising prices and Taiwan's faltering
stock market would increase public dissatisfaction with the KMT
government. If this trend continued, Yang stated, the DPP would do
well in 2009 "3-in-1" county and mayoral elections. He expressed
confidence that the DPP would not only hold on to its current seats
in Tainan City and County and in Kaohsiung, Pingtung and Chiayi
Counties but would also take Yilan and Nantou Counties from the KMT.
Only Chiayi City would be difficult to win, Yang assessed, since
the current KMT mayor there was governing in a non-partisan manner,
focusing on family ties and constituent services.

Chen Presidency: Lost Opportunity
----------------------------------

5. (SBU) Looking back on Chen Shui-bian's Presidency, Yang
explained that President Chen had lost an opportunity over the last
two years by failing to deal effectively with the PRC. The DPP
already believed that Taiwan was a sovereign country, Yang
explained, but it was not constructive for Chen to focus solely on
national sovereignty questions. Recent polls indicated that most
voters support the status quo and only a small minority favor
independence or unification. Therefore, Yang went on, the party
should accept the public's verdict, stick with the status quo, and
let time solve the cross-Strait problem. Yang stated that President
Chen "talked too much and too frankly." The deep green had hijacked
Chen towards the end of his term, he stressed, and put the party at
a severe disadvantage during the 2008 election season.

6. (SBU) Nevertheless, Yang underscored, Chen remained the DPP's

TAIPEI 00001044 002 OF 003


most influential force because of his strong grass-roots support.
Yang expressed confidence that the courts would find Chen innocent
of corruption charges. Once that happened, Yang explained, voters
would start to feel sentimental about DPP rule and reassess Chen's
Presidency, which would allow Chen to reemerge publicly in several
years and affect the DPP's 2012 Presidential nomination process.
Looking ahead to the 2012 election, Yang predicted that 2008 DPP
Vice Presidential nominee Su Tseng-chang would be the DPP candidate
and Tsai Ing-wen would be his running mate.

KMT: Old Familiar Faces
-----------------------

7. (SBU) On the new KMT government, Yang claimed that voters were
already questioning the KMT's economic stewardship and losing
confidence in Ma's cabinet. He said they had noticed the advanced
age of some of Ma's ministers (Premier Liu is 65 and Straits
Exchange Foundation (SEF) Chairman P.K. Chiang is 76) and the
prevalence of old KMT government officials from eight years ago.
Agreeing with DIR's comment that KMT unity was fracturing with the
election over, Yang remarked that the Executive and Control Yuan
nomination imbroglio had exacerbated tensions between Ma and KMT
Chair Wu and that Ma's problems with LY Speaker Wang Jin-pyng were
long standing.

8. (SBU) Yang speculated that if Ma tried to reverse his declining
poll ratings in southern Taiwan by conducting another "long stay"
campaign, the tactic might backfire. Yang stated he even doubted
the sincerity of Ma's original "long stay" campaign last autumn,
suggesting it was motivated more by a desire to fend off accusations
of spending too much time in the office ("zhai-nan") rather than a
genuine interest in understanding the economic needs of southern
Taiwan.

9. (SBU) Recounting that Ma had recently invited southern mayors
and magistrates to Taipei for a "tea party" discussion, Yang related
that most of the discussion involved local officials asking Ma for
more resources. Yang said he was the only participant who raised
political issues, which included him reminding Ma of Ma's campaign
promise that Taiwan's people would control Taiwan's future. Yang
said he argued to Ma that direct cross-Strait links jeopardized such
control and signaled a KMT willingness to relinquish Taiwan's
sovereignty. Yang lamented that other magistrates did not follow
his lead, preferring instead to ask for money. At least, Yang
acknowledged, Ma would probably agree to continue convening these
tea parties as long as the invitees did not pressure him on politics
too much.

PRC Tourists: Not a Panacea
----------------------------

10. (SBU) Criticizing Ma's government for leaning too much towards
the PRC, Yang stated that the influx of PRC tourists stemming from
direct cross-strait links would do little to boost Taiwan's economy.
PRC tourist numbers were too limited, he explained, and their
purchasing power was too low. Yang said he had heard that some
local stores would not welcome PRC tourists since they were "too
noisy." He also suggested that PRC tourists would drive away
high-spending Japanese tourists, relating that one local hotel
manager told him that noisy PRC tourists forced him to put Japanese
tourists on separate floors. Yang claimed that this phenomenon (PRC
tourists driving away Japanese tourists) had already materialized in
the Philippines.

11. (SBU) Yang insisted that Ma's government had overstated the
impact of direct cross-Strait flights. Over the first weekend of
direct flights, he pointed out, many more Taiwanese than mainlanders
had taken those flights. Yang stressed that while other magistrates
and mayors were actively soliciting Chinese tourists, he would not
go out of his way to do so. Chinese tourists were not a panacea for
Taiwan's ailing economy, he underscored. Increased numbers from the
PRC might even bring problems, like pandemic diseases, fake
marriages and human smuggling.

Yang's Future: Maybe Not in Kaohsiung City
-------------------------------------------

12. (SBU) Asked by DIR about his future political plans, Yang
demurred, noting that it would be difficult for him to run
elsewhere, since most counties and cities already had strong

TAIPEI 00001044 003 OF 003


potential DPP candidates from those local areas. Current DPP Tainan
City Mayor Hsu Tien-tsai might run for Tainan County magistrate, but
he would have to overcome several local DPP candidates. DPP
Legislator Lai Ching-te was already a strong candidate for the seat
Hsu would be vacating in Tainan City. Yang predicted that Kaohsiung
City Mayor Chen Chu would take advantage of her incumbency to run
for reelection in 2010 but questioned whether her fragile health was
up to the demands of a vigorous campaign.

Comment
-------

13. (SBU) When Mayor Chen's poll ratings were lagging earlier this
year, Yang's backers had eagerly promoted him as the stronger
candidate to run against an invigorated KMT in Kaohsiung City in
2010. If Yang's supporters persist, the local DPP "New Tide"
faction to which both Chen and Yang belong could split, paving the
way for a strong KMT candidate to continue the KMT's surprising
winning streak in Kaohsiung City. If Yang's supporters back down,
Chen will fully enjoy the incumbent's edge, especially if Kaohsiung
pulls off a successful World Games in 2009 and the city's economy
begins to pick up steam. Nevertheless, both our local DPP and KMT
contacts are keeping a close watch on the mayor's health, and Chen's
detractors are likely to pounce on any sign that her lingering
health problems may hinder a strong campaign. End comment.

CASTRO

YOUNG

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