Untying the Knot

1. Untying the Knot Richard C. Bush Brookings Institution Center for Northeast Asian Policy Studies www.brookings.edu

2. The Taiwan Strait Paradox • Shared Economic Interests • Extensive Private Interchange • Common Ethnic and Cultural HeritageBUT • Political Hostility • Military Build-up www.brookings.edu

3. The PRC Hypothesis • It’s Lee and Chen, stupid!BUT • In office, Lee and Chen have been careful not to rule out unification totally. • They certainly opposed one country, two systems (1C2S). • They insisted that the ROC or Taiwan was an independent sovereign state. www.brookings.edu

4. The PRC Hypothesis • Both have insisted Beijing should acknowledge that Taipei is essentially equivalent, that Taiwan have an international role, and that the PRC renounce the use of force. • In addition, both have been frustrated that Beijing has rejected Taipei’s views outright and ignored its moderation. www.brookings.edu

5. The PRC Hypothesis • To be sure, Lee and Chen did act provocatively at times. • They also took initiatives that were motivated by domestic politics. • Yet Beijing incorrectly read their opposition to 1C2S as a rejection of unification. For Lee and Chen, however, how Taiwan might be a part of China has governed whether it should be a part of China. www.brookings.edu

6. The Taiwan Strait Knot (TSK) • The TSK is a knot formed by two twisted strands of rope. Each strand represents a core substantive issue: • The first issue is sovereignty • The second is security • The strands are twisted because they are interrelated. www.brookings.edu

7. TSK: Sovereignty • Stephen Krasner tells us that sovereignty can take four forms: • Domestic sovereignty; • Westphalian sovereignty; • International legal sovereignty; and • Interdependence sovereignty. • The first three, particularly Westphalian sovereignty, are analytically important. www.brookings.edu

8. TSK: Sovereignty • Many observers focus only on international sovereignty, on whether the ROC is a full member of the international community. • But when it comes to sovereignty, for cross-Strait relations, it’s Westphalian sovereignty that matters more. www.brookings.edu

9. TSK: Sovereignty • Westphalian Sovereignty: • A government’s absolute right to rule within the territory under its jurisdiction unless it chooses to vest a higher authority with its powers. • The key is non-subordination. • This is the concept that underlies the stance that the ROC is an independent, sovereign state. www.brookings.edu

10. TSK: Sovereignty • This claim is fundamentally antithetical to the 1C2S approach. • Under 1C2S: • Central government is the exclusive sovereign; • The Special Administrative Region (SAR) is subordinate to central government and acts internationally only at its discretion; and • The SAR has autonomy and nothing more. • In practice, Beijing’s system for Hong Kong limits political outcomes to what it can tolerate. www.brookings.edu

11. TSK: Security • Taiwan and the PRC are locked in a security dilemma. • Each fears the intentions of the other. • Each builds up its capabilities to hedge against pre-emption. • Each reads the other’s hedging as hostile. • Mistrusting the other and fearing exploitation, each is afraid to make a concession. www.brookings.edu

12. TSK: Security • Yet the cross-Strait security dilemma is special. • What China fears is not military action by Taiwan but a political initiative that will irreversibly change the status quo and close the door on unification. • In addition, Taiwan must live with the fear of abandonment by its de facto ally, the United States. www.brookings.edu

13. TSK: Security • The essence of the security dilemma is that each side understands the value of peace but mistrusts the other too much to pay the price to gain it. • Each worries that if it makes a concession, the other side will exploit its good will. • Beijing’s demand that Chen Shui-bian accept the 1-China principle is an example. www.brookings.edu

14. Tightening the Knot • Several factors in the dispute • Domestic politics: • In Taiwan: • Identity and the fear of outsiders • The DPP’s history as opposition party • Taiwan’s unconsolidated democracy • In China: • Leadership politics • Nationalism www.brookings.edu

15. Tightening the Knot • Decision-making systems: • Misperception • Miscalculation • The Leverage Game: • The International System • The United Front • The U.S. Factor • Dual Influence and Dual Deterrence www.brookings.edu

16. Untying the Knot • If the knot is to by untied, three things are required: • Ways to reconcile substantive differences over sovereignty and security, which are linked. • Ways to mute the effect of the aggravating factors. • A skillful integration of substance and process. www.brookings.edu

17. Untying the Knot: Substance • Concerning the sovereignty issue, is there a way for Beijing to get what it wants (unification) and for Taipei to get what it wants to preserve (sovereignty)? • There are models of political union that are composed of sovereign entities: confederation, federation, etc. www.brookings.edu

18. Untying the Knot: Substance • Such unions are difficult to construct and hard to preserve, but sharing sovereignty is possible. • Both the KMT and President Chen have expressed a positive attitude towards such unions. • It is the PRC that is opposed, for some important reasons. www.brookings.edu

19. Untying the Knot: Substance • There have been some ideas on the security side: • Agreement to end the state of hostilities • Allowing Taiwan to keep its armed forces • Jiang Zemin’s missile-withdrawal idea • The interim-agreement proposal • CBMs • Yet all of these founder because of mutual mistrust. www.brookings.edu

20. Untying the Knot: Process • Even if theoretically there is common ground, mistrust makes it difficult for the two sides to move there. • Perhaps it is necessary to use process to drive substance, instead of using substantive concessions to begin process. www.brookings.edu

21. Untying the Knot: Process • Setting preconditions for dialogue, while understandable, only compounds mistrust: • One China Principle • 1992 consensus • Recall that Beijing set a precondition after Lee Teng-hui’s U.S. trip but then ignored it for Koo Chen-fu’s 1998 visit. www.brookings.edu

22. Untying the Knot: Process • Instead, the two sides should establish a private, authoritative channel to: • Reduce mistrust; • Build mutual understanding and assurance; and • Explore methods of starting public dialogue. • This sort of channel existed before. www.brookings.edu

23. Untying the Knot: Process • As trust is built and as dialogue resumes, a mutually agreed set of principles could create a framework for discussions. This would: • Set limits; • Define areas of fundamental consensus; and • Establish an agenda for future action. • In process terms, this approach is different than an interim agreement. www.brookings.edu

24. Untying the Knot: Process • How to deal with the aggravating factors? • For the leverage game: diplomatic truce and an end to PRC intervention in Taiwan politics. • To manage the Taiwan politics of cross-Strait relations, there needs to be a mechanism of transparency and consensus building. www.brookings.edu

25. Untying the Knot: Process • What role for the United States? • Different forms of “intermediation”: • Messenger • Intellectual facilitator • Process facilitation • Mediation • Serving as a guarantor www.brookings.edu

26. Untying the Knot: Process • I believe that the lower end of this scale is more appropriate. On mediation, • Do both sides trust Washington? • Would both sides trust the U.S. throughout? • Would the Congress support the Executive Branch? • How to deal with the fact that the United States is a party to the dispute? www.brookings.edu

27. The Near Term • If solving the dispute is not possible, stabilization is the next best thing. • A window of opportunity has opened. • Beijing need not fear constitutional change in Taiwan. • Communication and trust-building is as important for stabilization as it is for solution. www.brookings.edu

28. The Near Term • Preconditions are an obstacle to communication and trust-building. • The U.S. approach of dual deterrence also contributes to stabilization. www.brookings.edu

29. A Final Word • The group that has the most to lose from mismanagement of the Taiwan issue is the people of the island. • They have finally gained the power to make choices about their future. • The U.S. will play a role, but it is the people of Taiwan who will have to choose. • To make good choices, Taiwan must strengthen itself. www.brookings.edu