US embassy cable - 05TAIPEI168

C O N F I D E N T I A L SECTION 01 OF 03 TAIPEI 000168 
 
SIPDIS 
 
STATE PASS AIT/W 
 
E.O. 12958: DECL: 01/14/2015 
TAGS: PGOV, PREL, TW 
SUBJECT: REALITY CHECK ON DPP-PFP COOPERATION 
 
REF: A. 2003 TAIPEI 04007 
     B. TAIPEI 00118 
 
Classified By: AIT Director Douglas Paal, Reason: 1.4 (B/D) 
 
1. (C) Summary:  PFP Chairman James Soong is struggling to 
recover from a political setback and is using everything 
within his means.  Soong has fueled rumors of a DPP-PFP 
alliance and is hoping to use a visit to Washington to 
sanction his role as a national leader in Taiwan.  The DPP, 
having fallen short of an LY majority and always looking to 
sow tension within the Pan-Blue, has nothing to lose in 
courting the PFP.  Soong's public statements immediately 
after the LY election hinted that such an alliance was 
possible.  Soong's private words to KMT Chairman Lien Chan 
and his PFP ranks, however, suggest the Pan-Blue will remain 
intact, but that the PFP will play a more independent role. 
The agreed-upon KMT-PFP merger will not take place by the 
March 2005 target, if at all.  Soong has already derived some 
benefits from his maverick posture, but he also risks 
alienating core PFP supporters and his own PFP colleagues who 
for their own reasons want to merge with the KMT.  Soong 
appears to be playing one of his last cards today with his 
high profile visit to Washington.  End Summary. 
 
James Soong: Phoenix Rising 
---------------------------- 
 
2. (C) PFP Chairman James Soong is currently struggling to 
recover from a political setback and is using everything 
within his means to do so.  By exploiting the PFP's role as a 
"crucial minority," Soong has used rumors of a DPP-PFP 
alliance to leverage his position with the KMT and played up 
meetings with Washington officials to sanction his role as a 
Taiwan national leader.  December 11 was a grim day for 
Soong, with the PFP losing 12 incumbents in the LY, and the 
KMT saying there will be no room in the party leadership for 
Soong when, for want of resources and electoral support, he 
is finally forced to accept merger on KMT terms.  In recent 
days, however, various sources are feeding media speculation 
of potential DPP offers of a host of positions to Soong, 
including Premier, Straits Exchange Foundation (SEF) Chair, 
and Chair of Chen Shui-bian's proposed "Cross-Strait Peace 
Development Commission." 
 
Strange New Bedfellows? 
----------------------- 
 
3. (C) The DPP's failure to win a Legislative Yuan (LY) 
majority in the December 11 election has prompted much 
speculation that Chen Shui-bian might try to build a 
governing alliance with the PFP, whose 34 LY seats would give 
the DPP majority control of the LY.  Over the past 30 days, 
the DPP has not hesitated to fuel these rumors, with DPP 
leaders, including Kaohsiung Mayor Frank Hsieh, Acting 
Chairman Ker Chien-ming, and DPP Secretary General Chang 
Chun-hsiung, making suggestive comments of imminent DPP-PFP 
accord.  As early as December 14, the Taiwan Daily News 
quoted an anonymous DPP official saying cooperation with the 
PFP was definitely a possibility.  On December 29, Ker 
publicly suggested that Soong should head Chen Shui-bian's 
proposed "Cross-Strait Peace Development Committee."  After 
SEF Chairman Koo Chen-fu passed away on January 3, rumors 
started circulating that the DPP was considering Soong as 
Koo's successor.  Legislator Lee Wen-chung and other members 
of the DPP's "60s Group" (made up of DPP members born around 
that decade) even urged the leadership on January 5 to delete 
the pro-independence plank in the party's platform.  The DPP 
loses nothing by wooing the PFP -- if it succeeds it could 
form a comfortable LY majority, and effectively destroy the 
Pan-Blue alliance.  If the courting goes nowhere, the DPP has 
already damaged the Pan-Blue coalition by sowing suspicion 
between KMT and PFP. 
 
Cryptic Words from Soong 
------------------------ 
 
4. (C) Statements by PFP Chairman James Soong immediately 
after the LY election also hinted that a DPP-PFP alliance was 
possible (Ref A).  Soong ruled out the possibility of a 
KMT-PFP merger, declaring that PFP would cooperate with the 
KMT only on an issue by issue basis, and fueled rumors of DPP 
overtures to the PFP for coalition government by making a 
leading statement, just before boarding a U.S.-bound plane on 
December 15, that he was not interested in forming a joint 
cabinet with the DPP.  Soong returned to Taiwan briefly to 
attend the funeral of former President Chiang Ching-kuo's 
widow, Chiang Fang-liang, on December 27, then departed for 
the U.S. again the next day saying that the PFP would not ask 
for any positions in the new government and would not 
participate in a coalition government.  However, Soong said, 
the PFP should act in the interest of the public and not 
merely along confrontational Green-Blue ideological lines. 
He added that the PFP would cooperate with the KMT on 
defending the ROC, but compete with the KMT on legislation on 
political party reform, and that the PFP would consider 
cooperating with any other parties on economic and public 
policy. 
 
5. (C) Soong's public statements appear to correlate with 
what he has said in private to Lien Chan and to his PFP 
colleagues.  Lien told the AIT Director on January 12 that 
Soong had assured him that, although KMT-PFP merger was not 
possible in the immediate future, the PFP would continue to 
cooperate with the KMT.  If the DPP government was willing to 
safeguard the ROC, however, he would consider cooperating 
with the DPP on specific issues involving the people's 
livelihood (Ref B).  Soong confidant Hwang Yih-jiau confirmed 
to AIT on January 11 before he departed Taiwan to join Soong 
in the U.S. that these are the guiding principles that Soong 
laid down for the party. 
 
Areas for Cooperation 
--------------------- 
 
6. (C) A PFP insider Raymond Wu, formerly PFP International 
Affairs Director, told AIT on January 11 that the possibility 
for a DPP-PFP alliance is very real, and outlined three 
levels of possible cooperation.  At the very least, Wu said, 
the two parties could cooperate on policy, but it would be 
limited to domestic issues such as economics, social welfare, 
education, and environment.  Wu said the ideological gap 
between the two parties was too wide, so they would probably 
not seek cooperation on cross-Strait or international policy. 
 The DPP and PFP, Wu continued, could also cooperate on 
personnel issues, including appointment of PFP members to the 
new Cabinet and, more importantly, securing for the PFP the 
LY Vice Speakership.  Wu told AIT that PFP Legislators 
Christina Liu (Yi-ru), Chung Jung-Chi, Lee Ching-an, Lee 
Ching-hua, and Shen Chih-hwei are all lobbying for the job. 
Finally, there is also talk, Wu said, of forming a DPP-PFP 
coalition government.  Wu, however, dismissed the third point 
as highly unlikely. 
 
7. (C) KMT Legislator John Chang (Hsiao-yen) told AIT on 
January 14 that Soong has been extremely successful in 
exploiting the PFP's role as a "crucial minority" in the LY. 
Chang noted the KMT had already dropped its original 
intention of nominating Wang Jin-pyng and Chiang Pin-kun as 
the LY Speaker and Deputy Speaker.  Most likely, he said, the 
Deputy Speaker will now come from the PFP ranks.  Chang also 
confirmed that informal talks have taken place between DPP 
and PFP caucus leaders and that there will definitely be 
"some kind" cooperation on domestic policy. 
 
High Risk Game 
-------------- 
 
8. (C) Chang said however that Soong should be careful not to 
overplay his hand in this "highly risky game."  He pointed 
out that there is the danger that Soong might alienate his 
grassroots supporters, as well as PFP legislators (Chang 
estimated that at least ten would leave the PFP and return to 
the KMT if Soong moved too far toward the DPP).  The 
possibility of alienating core PFP supporters worries Hwang 
Yih-jiau and other PFP leaders.  Hwang told AIT that PFP 
supporters are retired and active military personnel, 
Mainlanders, and other dark Blue voters who would not 
tolerate any sort of cooperation with the DPP.  Raymond Wu 
pointed out that many PFP LY candidates had campaigned on the 
promise of merging PFP with KMT, and that some newly elected 
members, Vincent Chang (Hsien-yao) for example, may well be 
recalled if the merger is not achieved. 
 
9. (C) Wu also pointed out that there are many other PFP 
members who were elected in areas with high concentrations of 
KMT supporters, and because of their personal ambitions 
(especially for this year's city and magistrate elections), 
these PFP members desire greater integration with the KMT. 
For example, Wu told AIT that Sun Ta-chien wants to run for 
Taoyuan County Magistrate, Chou Hsi-wei and Lee Ching-hua for 
Taipei County Magistrate, Lee Ching-an for Taipei City Mayor, 
and Lee Yong-ping for Taipei City Deputy Mayor. 
 
From Party to Entourage 
----------------------- 
 
10. (C) Yet another complicating factor is that the best 
interests of the PFP as a political party might not 
necessarily be in the best interests of James Soong.  Many 
KMT officials say they simply cannot see a role in the KMT 
for Soong.  They doubt party members would be willing to 
elect Soong as Chairman and expect Soong would not accept any 
position other than the top job.  Soochow University 
Professor Emile Sheng told AIT on January 3 that he feared 
Soong would not hesitate to break up the PFP if he thought it 
were in his interest.  Sheng said that even if only half of 
the 34 PFP legislators stayed with Soong, he would still 
control 17 LY seats, which is more than the Taiwan Solidarity 
Union's (TSU) 12 seats. 
 
Comment: In the Driver Seat 
---------------------------- 
 
11. (C) For all the talk and rumors of DPP-PFP cooperation, 
there has been little evidence of actual negotiations between 
the two parties.  The PFP continues to block legislation of 
vital interest to the DPP -- and the U.S. (such as the 
Defense Special Budget).  Though professing opposition to the 
KMT's "black gold" (corruption) image, the PFP did not even 
cooperate with the DPP in placing the Political Party Reform 
bill on the LY agenda, an issue that the DPP uses to attack 
the KMT's "ill-gotten assets."  In the meantime, Soong has 
proved once again that he is one of Taiwan's most astute 
politicians.  Dominating today's headlines with news of his 
meetings with American officials in Washington, Soong has 
returned from "loser" status on December 11 to being at the 
center of Taiwan politics. 
PAAL