US embassy cable - 05TAIPEI3180

C O N F I D E N T I A L SECTION 01 OF 02 TAIPEI 003180 
 
SIPDIS 
 
STATE PASS AIT/W 
 
E.O. 12958: DECL: 07/28/2015 
TAGS: PGOV, TW 
SUBJECT: KMT IN "WAIT AND SEE" MODE PENDING LIEN CHAN'S 
RETURN 
 
REF: TAIPEI 3097 
 
Classified By: AIT Director Douglas Paal, Reason(s): 1.4 (B/D). 
 
1.  (C) Summary: Since Ma Ying-jeou's KMT Chair election 
victory on July 16, there has not yet been any noticeable 
shift in the direction of the party.  Ma, who does not assume 
office until August 19, has begun to travel around the island 
to thank supporters, to build KMT momentum for the December 
city/county elections, and to gauge support for various KMT 
reform proposals.  LY Speaker and former KMT Chairman 
candidate Wang Jin-pyng still refuses to reconcile with Ma, 
and has announced his intention to relinquish his Vice-Chair 
position after current Chairman Lien Chan steps down.  Lien, 
who left Taiwan immediately after the election, is scheduled 
to return on July 28.  According to AIT contacts, until Lien 
returns and makes his intentions known, no one can predict 
the party's course, or whether there will be meaningful 
cooperation between Chairman-elect Ma and Lien ally Wang. 
End summary. 
 
2. (U) On July 23, Ma started his "thank you" tour around 
Taiwan, making his first stop in Taichung City, where he 
garnered 77 percent of the party vote.  Ma told the press he 
planned to cut 1000 of the party's 1600-member staff.  Ma 
also contemplated moving KMT headquarters out of its lavish 
and imposing gray granite Taipei building, and into more 
modest facilities.  DPP opponents have long accused the KMT 
of acquiring the building, located directly opposite the 
Presidential Palace, through illegal means.  Ma also used the 
Taichung City stop to promote Pan-Blue unity, without which, 
Ma said, the KMT would certainly lose the December 
city/county elections.  Ma has pledged to visit 25 cities 
over the next month to promote his ideas for KMT reform and 
Pan-Blue cooperation. 
 
3. (C) Current Chairman Lien Chan departed Taiwan for the 
United States shortly after casting his ballot on July 16. 
He was originally scheduled to return to Taiwan on Tuesday, 
July 26, in time to preside over the weekly meeting of the 
KMT Central Standing Committee (CSC) on Wednesday, July 27. 
After it was announced that Lien's return was delayed until 
July 28, the CSC meeting, which would have brought Ma and 
Wang face to face, was canceled.  AIT contacts in the KMT had 
anticipated that at this meeting Lien would most likely urge 
cooperation between the former adversaries.  If, on the 
contrary, Lien fails to push for reconciliation, it will be 
interpreted to indicate Lien's continued support for Wang, 
and implied opposition to Ma's proposed reforms.  James Chen 
(Jian-zhi), former KMT legislator and Wang Jin-pyng's chief 
of staff, declined to meet with AIT until the first week of 
August, explaining that at present matters within the party 
were "still unclear." 
 
4. (C) KMT Legislator and self-styled Lien-Ma-Wang 
intermediary Hsu Shu-po told AIT that he is "100 percent 
certain" that Wang Jin-pyng will not cooperate with Ma 
(reported septel), and that Ma's leadership will face serious 
challenges in the short term.  According to Hsu, the KMT 
hierarchy is highly age-sensitive, and after his humiliating 
loss, Wang would never accept a subordinate position to the 
younger Ma.  Hsu, who claims to have been Lien Chan's 
go-between to the Ma and Wang camps during the Chairmanship 
election, says Wang's resentment is so strong that he will 
refuse to work with Ma even if Lien asks him to do so.  Hsu 
said that beyond his personal animosity toward Ma, Wang also 
feels no sense of loyalty or obligation to the party after 
his defeat.  Hsu is afraid that once the LY resumes normal 
sessions, the potential for a power struggle within the party 
will increase if Wang and Ma disagree on legislation. 
Despite these gloomy short-term predictions, Hsu believes 
that if Ma can improve his networking and interpersonal 
skills to establish his own relations with KMT legislators 
and local leaders, Ma will be able to trade star-power 
charisma for cooperation, and his long-term prospects will be 
good.  Hsu added that in the likely event Wang refuses to 
mobilize the KMT vote for December's city/county elections, 
Lien Chan himself will pitch in.  Former KMT LY member and 
Lien Chan associate Apollo Chen (Hsueh-sheng) told AIT that 
Wang will not cooperate with Ma until one year before the 
2008 presidential election.  Chen said Wang cannot accept a 
position under Ma without losing his stature within the KMT. 
Chen opined that by refusing to play second-fiddle to Ma, 
Wang can credibly declare his own presidential candidacy in 
2007, which he can use to angle for his real goal: the 
Vice-Presidential slot under Ma. 
 
5. (C) Comment:  Lien Chan is still the KMT's center of 
gravity.  Others in the party are waiting to see whether he 
sides with Wang and the party's traditionalists, or with 
reformer Ma, who has already been embraced by the KMT 
rank-and-file.  Lukewarm support for Ma will likely be 
interpreted as implicit support for Wang, and could establish 
Wang as a competing focus of power within the party.  Hsu 
Shu-po suggests that if Ma is able develop his own network of 
contacts, he may be able to convert his grass-roots 
popularity into real political power within the KMT.  Ma's 
personality militates against this -- his circle of trusted 
allies is very small, and he does not make new alliances 
quickly.  Ma faces the challenge of having to build by 
December a network of allies that can yield the kind of 
results he needs to stay in power.  End comment. 
PAAL