The View from Taichung: Pension reform is Democratic reform

The Tsai Administration continues the democratic transistion

Pension reform protesters outside Legislative Yuan clash with police on April 19. (By Central News Agency)

Taiwan President Tsai Ing-wen faces a trio of challenges perhaps no other world leader faces. Just finishing her first year, she must handle the normal challenges any president has, responding to domestic issues and advancing her party’s platform. Yet she must also manage the unique threat of China, brooding over how to annex Taiwan and snuff out Taiwan’s democracy. Finally, Tsai must preside over the de-colonization of Taiwan society from decades of Kuomintang (KMT) colonization.

That latter role was in the news this week as protesters, largely KMT supporters of one kind or another, stormed various locations in the capital in an attempt to thwart pension reform. The Legislative Yuan was encircled and there was much traffic congestion at the main railway station in Taipei.

The pension reform is popular and urgently necessary from a budgetary standpoint. The government has warned that military pensions, the largest chunk of pensions, could be in default as early as 2020, with civil servant pensions in default by 2030 and teachers in default the following year. According to media reports, labor and civil servant pensions were underfunded by US$570 billion, a figure larger than national GDP.

The counties have to raise the money for pensions and interest payments on their debts. Thus, these payouts to pensioners represent an additional tax on the local areas, which must be paid out of funds that could have gone for roads, schools, or development projects.

Thus, most of the county governments in Taiwan are flat broke. It is no coincidence that the indebted areas across the south, Tainan, Pingtung, and Yunlin, are all hotbeds of Taiwan nationalism. For much of the south, especially for the older generation, “independence” really means independence from the KMT colonial state, and its impoverishment of southern Taiwan.

The protesters are aware of all this, of course. Many of the protesters are old soldiers, die-hard KMT supporters, or from KMT affiliated organizations. 

Recent pro-KMT protests have attempted to appropriate the language and tactics of the Sunflowers. As Brian Hioe deftly put it “Members of the pan-Blue camp have taken to imitating the tactics of Taiwanese youth society in recent times, seeing their loss of public support as a failure of form, rather than of the content of their politics failing to appeal to contemporary Taiwanese society.”

It should also be noted that another goal of adoption of these tactics is to de-legitimize the Sunflowers and occupation tactics in general by painting the Sunflowers as just another partisan, self-interested protest among many.

There was some violence as protesters rushed pan-Green politicians, physically confronted journalists, and smashed the windshield of a vehicle belonging to SETV, a local TV station. The police were well prepared, however, and the legislature was sealed and entrances protected.

Though the military pension crisis is most acute, to prevent a clash with the military, the Administration has left it up to the military to come up with a pension reform program for its members. The government has said the military will receive “special consideration.”

President Tsai has promised to investigate the violent acts by protesters. She has also promised to go forward with pension reform despite opposition. Tsai’s balance and restraint may not always make headlines, but it makes progress.