Boulder, CO: Lynne Rienner Publishers, 2012. xi, 203 pp. (Tables, figures.) US$55.00, cloth. ISBN 978-1-58826-806-8.
Cal Clark and Alexander C. Tan begin this book about Taiwan by clearly stating the paradox that defines the central problem they address: “the very same institutions and strategies that worked in the past have become counterproductive in the present” (3). Taiwan’s economic and political miracles have now been well-studied, and this book’s contribution, as a work of political economy, is to analyze how the two miracles are interrelated and have brought about a new set of challenges. This is nothing new: over the course of the past six decades, Taiwan has repeatedly been a victim of its own success, and the leaders and people have demonstrated an exceptional flexibility in meeting and surmounting these challenges to take Taiwan to a new level. And in good dialectical fashion, this then creates a new set of problems to confront.
The second chapter reviews Taiwan’s economic development from the 1950s through the 1990s. It breaks it down into five main transformations: agriculture to light industry; export orientation; light to heavy and high-tech industry; mature industries moving offshore to remain globally competitive; and the search for new industries, such as biotech, to take the economy to a new level. The authors pay attention to the concomitant changes in social structure, especially the rise of the middle class and improving standard of living with relatively equal income distribution. There are very useful charts illustrating the changing role of the state in the economy at each stage, and how each stage created a new set of social resources which formed the basis for the next upgrade of the economy. They emphasize that the state had no grand design for the economy but met each challenge with admirable flexibility, not bound by any orthodoxy.
Chapter 3 covers the road from authoritarianism to democracy, a process which lagged the rapid and relatively smooth economic transformation. It culminated in the democratic consolidation of 1995-1996, marked by the direct election of the president. They do not neglect the harsh repression, but do highlight the contribution of the constitution, which, although suspended, did set up democratic institutions, and the role of local competitive elections. They step back to observe the democratization process, identifying three stages: removal of authoritarian institutions; exercise of popular sovereignty; and defining the terms of political competition. Going against the conventional approach, which stresses demonstrations and conflict, they conclude that the process actually involved a series of pacts among political parties and factions, with the important contributions of Lee Teng-hui as a “creative policy entrepreneur” (63). Again, a very helpful set of tables lays this out quite clearly. Along the way, they relate Taiwan’s experience to theories of democratization.
The next three chapters expose the challenges currently facing Taiwan. One is whether or not Taiwan’s economy has become “boxed-in,” by which they mean the island faces dramatically curtailed opportunities for rapid growth. This is a clear case of a factor contributing to early success: small and medium enterprises (“guerilla capitalists”) now facing a new world of competition and a lack of ability to adjust or respond to government incentives to reach economies of scale. And then there is the rise of China, which presents a whole new range of challenges. Here in particular, economics and politics are deeply intertwined. The authors are not pessimistic about Taiwan’s chances to adapt once more.
Chapters 5 and 6 look at the political side. One is political gridlock, a situation hardly unique to Taiwan, but definitely very serious due to the island’s precarious international standing and relations with China. The weakened state has also lost its capacity to guide the economy as in the past, further hampering Taiwan’s ability to successfully meet the many challenges before it. Democracy cannot solve all political problems and has left Taiwan in what they call an “institutional imbroglio” (111), namely the ambiguity as regards the center of power: the president or premier. They illustrate the economic consequences with a detailed look at the politicization of the financial sector.
The final substantive chapter examines how the political system has become polarized—again, not something unique to Taiwan—but with serious implications as it involves matters of national identity and cross-strait relations. Based on opinion polls, they conclude that there is a disconnect between polarization among the elite versus more consensus among the citizenry at large.
In the concluding chapter, the authors say they “have presented something of a schizophrenic view of Taiwan’s political economy” (157). I prefer to call it dialectical: each advancement produces a new set of contradictions to resolve. For all that, they still end up cautiously optimistic about Taiwan’s chances, given its legacy of “flexibility and eclecticism” (162) and willingness to confront the serious challenges it faces.
This is a very smart book. It condenses a huge amount of material and never loses sight of its central argument. It addresses a number of issues in political science, bringing the discussion of Taiwan into larger debates in the discipline. It regularly situates the discussion in the sweep of Taiwan’s history to highlight trends as well as discontinuities. The many charts are particularly helpful. I would have liked more discussion of geopolitics, especially Taiwan’s involvement in the East and South China Seas conflicts with China, as well as the role of the overseas Taiwanese diaspora in domestic politics. I was surprised to see virtually no Chinese-language sources in the bibliography, which is regrettable as Taiwan has a vibrant community of academics, opinion makers and activists actively discussing these same issues, in Chinese as well as English, and many of them also participate in public life.
Thomas B. Gold
University of California, Berkeley, USA
pp. 335-337