Speculation: Taiwan Chinese conflict

June 14, 2006 at 3:35 pm

In the Pentagon's paper on Taiwan, they noted that a Chinese invasion of Taiwan would seriously hurt China's economy. But this doesn't quite make sense. Because Taiwan, like Hong Kong, has spent millions pouring money into the Chinese economy (Taiwan is famous for managing production of electronics in China) this only means that China has everything to gain by invading. The higher the revenues of Faxconn* Taiwanese companies and other manufacturing services the more China has to gain by making these businsses part of their domestic economy right now Faxconn's profits are enjoyed by Taiwanese owners and their foreign contractors. Plus, this idea that the Taiwanese aid to China somehow endears Chinese to Taiwan seems a little lop-sided. After all from the perspective of the Chinese worker in the plant, isn't Taiwan just cashing in on their cheap labor for greater profits at home? When I was in China many of the people I met had a high regard for their jobs (one amway worker was ecstatic about his "American" company and intensly proud), so it is possible that the Chinese working for Taiwanese companies do feel a higher level of sympathy for their democratic brothers, but the idea that the wealth of their economic ties deters China's military motives, which is a common arguement used in Taiwan, seems false. After all if the communists were to nationalize Taiwan's companies after an invasion, it would not just fit with the party line while bolstering GDP even further, it would also put them in control again.

On another note, dealings with China are always tricky. The flow of wealth has not just assisted the government, but has also assisted formerly jailed dissidents who were pushing for democratic reforms.

* that should be Foxconn and it's a Hong Kong company owned by a Taiwanese company. 

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