It Was the Economy, Stupid

In its fourth presidential election Saturday, Taiwanese voted overwhelmingly for the candidate backing warmer China ties, potentially ushering in a new era of moderation after eight years of Chen Shui-bian's confrontational approach.

In the end, the Kuomintang Party's Ma Ying-jeou successfully sold himself as the candidate for change, as opposed to four more years of the status quo under Chen's pro-independence Democratic Progressive Party. Voters embraced widespread expectations that Ma can revive the island's stagnant economy, while rejecting DPP rival Frank Hsieh's scare tactics and negative attacks.

Speaking at a press conference after his victory, Ma said voters had given him a mandate to improve ties with China. But he made clear he would not compromise on Taiwan's sovereignty. "Taiwan should be more open and more pragmatic; we should not isolate ourselves," said Ma. "Freedom and democracy are our most valued possessions—we will defend them with our lives." China considers self-ruled Taiwan a part of its territory that must eventually return, by force if necessary.

Ma's landslide victory (58 percent to his rival's 42 percent in a vote with high turnout) surprised analysts who expected a closer race. The result showed that for Taiwanese voters, the economy trumped national identity—the issue that had been decisive in previous elections. Ma is a Hong Kong-born Mainlander, and some thought that could cripple his chances amid surging Taiwan-first pride. (Under the KMT's one-party rule, a Mainlander minority that arrived in the late 1940s long ruled over a native Taiwanese majority.)

"People think the economy is most important," said analyst George Tsai. "Identity or ethnic difference aren't important enough now to prevent a Mainlander from being elected. And that's a healthy trend for Taiwan's democracy."

Taiwan's economy is strong on some indicators, such as exports and GDP (5.7 percent this past year). But Taiwanese complain of stagnant wages, inflation and fewer job opportunities. They say strong growth is only benefitting a few in the island's high-tech and other sectors, and not trickling down to the lower and middle class. It's popular in Taiwan to refer to an "M-shaped" society, in which inequality has widened and the middle class shrunk. Amid those economic woes, many saw Hsieh's DPP ignoring bread-and-butter issues while instead prioritizing identity politics and needless confrontation with China.