Transcription
It was given to Japan. A co-founder of the Chinese Communist Party, Lee Jao said, "When the war ended, we had dreams about the victory of humanism and peace. Instead, as he said, the opposite happened. The freedom and rights of the small and weak peoples have been sacrificed to a few big robber states."
This perfidious act triggered the first mass movement of protests in China, formerly known as the May 4th movement. Symbolically, it is regarded as the first moment that the Chinese people rose to protest against foreign powers. However, as China remained weak and divided with no central government in place after the collapse of the Qing dynasty in 1911, the humiliation of China continued.
Japan launched a full-scale invasion of Manuria, which had been Chinese territory in 1931. Six years later, the second Sino-Japanese war began with the immediate fall of Beijing and Shenzhen. Eight years of Japanese occupation of China followed. Sadly, this Japanese occupation was often brutal. In late 1938, after Nanjing fell, it is estimated that 300,000 civilians were killed in the Nanjing massacre.
The Japanese invasion of China could have continued for decades. But after Japan made the mistake of attacking Pearl Harbor in December 1941, China and the US became allies against Japan. Quite amazingly, Mao Zedong presently anticipated this in a speech in 1916, two and a half decades before World War II, when he said, "The time would be in 10 years, the place would be in the Pacific. It has been talked about for a long time that the US and Japan will go to war. In 10 years, China and America will join the just cause."
The Japanese occupation finally ended with the Japanese surrender on August 15, 1945. Sadly, after the Allied victory in 1945, Western powers barely acknowledged China's role. The Oxford scholar Rana Mitter has described China as the forgotten ally, and he observed that China was the first country to face the onslaught of the Axis powers by holding down large numbers of Japanese troops in the mainland. China was an important part of the overall Allied strategy.
1842 to 1945 is a long period. It is also a relatively recent period. Hence, most Chinese are aware that China had experienced many painful invasions and humiliations. In this time, China was known as the sick man of Asia. And this phrase still hurts.
On February 3rd, 2020, when the Wall Street Journal published an article on China entitled, "The real sick man of Asia," China expelled three Wall Street Journal reporters. Most Americans were puzzled and mystified. Yet, if one understands the century of humiliation China suffered, this strong Chinese reaction could have been anticipated. Today, no American newspaper will publish a headline containing the N-word. It brings back painful memories of the recent exploitation of African Americans. Similarly, the phrase "the sick man of Asia" brings back equally painful memories.
So, what was America's role in this century of humiliation? We will explore this question in the next segment. The best way to understand China is to just remember this key aspect. China is always playing the long game, not the short game. China is not interested in the next quarterly results or what the growth will be this year. China wants to see where it'll be 10 years from now. And so when you mention the macro sluggishness, yeah, they can blow away the macro sluggishness by injecting another big fiscal stimulus and then maybe everyone will be bubbling. The real estate may come back, consumer sentiment may come back. But that's a short-term thing, and that's not how the Chinese play the game.
And the Chinese, as you know, frankly realized a big mistake of the 2008-2009 financial crisis is that the fiscal stimulus they put in was too big, and landed them with a long tail of problems which they're still trying to eradicate. But there's no doubt that they're taking sufficient measures to ensure that the real estate thing will be scrubbed out in three to five years and consumer sentiment will then come back. But the more important thing from the Chinese point of view is what is going to be the strength and resilience of the economy for the long term.
And here, when future historians write about China's evolution, they will be astonished that China's share of global manufacturing in the year 2000 was 5%. 5%. But by 2030, 30 years later, it could hit 45%. Now, for any country to have its share of global manufacturing to go from 5% to 45% is amazing. But this is also part of the larger geopolitical game that China is playing. China knows that at the end of the day, what the United States will try to do is some kind of containment policy. And how do you overcome the containment policy? You make the Chinese economy indispensable to the global economy. Because frankly, if you're manufacturing almost anything anywhere in the world, at some point you'll need some part or other, and oh, it's been made in China. And that fact that they have 45% of the globe, they will reach 45%, it's a quite a stunning development, and that's what's changing the course of history, and not the short-term moves in the stock market or real estate market.
I think that this time, Japan needs to take China's diplomatic retaliations and rhetoric very, very seriously. And if you consider the military capacities between China and Japan, such a conflict, if it happened, will become a unilateral punishment taken by China toward Japan and Chinese people. The answer is no. I think no one knows why this guy uses this term, touches this topic in such a way, at this timing. No one knows because his behavior is just like her act alongside Trump. No one understands what the logic is. She just wants to do it. And in some aspect, from China's side, we believe that maybe she wants to send a testing balloon. Such a testing balloon is very important to her. Maybe she can kick two or three birds with this one stone.
The first is this sort of just an attention-seeking act. As I think she first wants to transfer attention from her poor domestic governance to more highly symbolic security issues, because nowadays the Japanese economy is not that good, and Japanese people's life burden is rising very high, and this new prime minister can do nothing to release the pain of the living cost of Japanese people. Though she wants to transfer the attention from the critical side to more simple and highly symbolic issues which she can deal with only by using her very articulated terms.
The first and the second, and I think that's one of the critical goals that the so-called right-wing political groups inside Japanese countries want to realize during her administration, which means they want to push forward some important modifications of the peaceful constitution, especially Article 9. They want to provide a basement to talking about the kind of scenarios that it's a proper time for Japanese, for the survival of the countries, just like those war criminals did in the 1930s, to tell people that it's an appropriate time to attack Pearl Harbor, otherwise the Chinese empire will be defeated by those enemies, and so on. The same logic they did in the last eight or 100 years.
And the third is, I don't know, but just like it wants to send some signals to test China and the United baseline, especially she wants to test to which extent she just likes that this young prime minister, she believes because she is so cute in front of President Trump. If you read his moves, moving and body languages during that process, definitely she feels very happy, and she believes that she is no cute. And she maybe believes that she got some assurance from President Trump, and Trump will provide some protection. It's a kind of blank check without any preconditions. So she can do everything.
What is China going to do about it? I think that this time, Japan needs to take China's diplomatic retaliations and rhetoric very, very seriously. Because the first time, say that our vice minister of foreign affairs called the Japanese ambassador in China with the top, with the directions from the top leaders. You can, it's the first time we read these terms. It's the first time we read these terms in our former news report. And several diplomats made very clear explanations what it means. It means that I will have a paper. This paper, in the Chinese name, is short here. It's just kind of a formal statement, and I will read every term on these papers on your face. And this paper is not written by this vice minister. This statement represents China's national interest. It's a very formal voice from the top leaders. So it's very negotiable. It's definitive. It's just a, I read out this statement and read these every term in your face. It's very formal, very harsh, and it's very rare being used because it's just proof. I'm so angry, and I tell you that definitely I will do something to punish you if you don't take back your rhetoric. I'm just sending you a very formal statement.
What will be the punishments? Yes, first time, Chinese foreign minister already sent a warning, the visitor warning to those Chinese travelers, say that it's not appropriate time to go to Japan. Tourism. Cut off the tourism. That means China wants to launch economic sanction policies toward Japan. We are moving step by step. And also, there's news say that China's you will find that nowadays there are three ministers launched a statement on these issues. There's an office dealing with the Taiwan affairs in the State Affairs and Taiwan, and the second is the foreign minister, Wang Yi, and the third is the minister of defense. It means that definitely you will see some highly symbolic military actions or even exercises alongside Japanese islands and to show that China is quite serious. And your rhetoric, if you don't take this rhetoric back, definitely maybe in the very, very worst scenarios, this escalation can lead to a real military conflict. And if you consider the military capacities between China and Japan, such a conflict, if it happened, will become a unilateral punishment taken by China toward Japan and Chinese people. We don't care that it's appropriate time to launch a kind of final count on all those historical debts between our two countries.
I think the US has come to the conclusion that if it's a conventional war, there's no certainty of winning. In fact, there's a good chance that they may lose. So they know they need submarines, and the only sea which is deep enough is the South China Sea. That it is better for Taiwan to negotiate with the mainland earlier rather than later because the longer you wait, the weaker your relative negotiating position. So, 20 years from now, 40 years from now, what will China be? What will Taiwan be? This speech will change the way you see the China-Taiwan conflict. George Yeo, Singapore's former foreign minister, breaks it all down with eye-opening insights on how Taiwan fits into the bigger US-China rivalry. His perspective is something you don't hear every day. Definitely worth a listen.
And this was the American position. But when the mainland became a problem, a challenge to America, the Korean War, the Seventh Fleet came in. It was in American interest to keep the two apart. Kissinger, when he negotiated normalization of relations with China, in his meetings with Tai and Mao, said again and again, the conversation came back to Taiwan. That on this issue, the Chinese showed no flexibility. It's bedrock. It is not a card which America can play against China because it will lead to a rupture and maybe even to war. And in recent years, relations have become quite bad. Both sides think of war scenarios. What happens if there's war? What will each side do? If China were to forcibly take over Taiwan, what would the US do? These are scenarios which the Indopacific Command, as a matter of professionalism, has to think through and exercise. RAN has also done such exercises.
I think the US has come to the conclusion that if it's a conventional war, there is no certainty of winning. In fact, there's a good chance that they may lose because China now has hypersonic missiles which can travel maybe 2,000-3,000 kilometers to hit US aircraft carriers, which means that aircraft carriers have to stay away and cannot intervene in Taiwan. So for the Americans, if they want to deter China, they must be able to threaten China with nuclear weapons, tactical and maybe up the scale if necessary. And you can be sure that on both sides, in dark rooms, there are strategic thinkers who work through the scenarios.
China knows that the US wants to deny it a counter-strike capability. They put their missiles now on high-speed trains. This about the same length, and China has lots of tunnels. So they can hide the missiles in the tunnels. But today, with satellites, you can monitor every railroad, every fast train, the entrance and the exit to every tunnel. So China is not sure that its land-based ICBMs can hit back. So they know they need submarines, and the only sea which is deep enough is the South China Sea. And in ASEAN, we don't want to get involved in this. We have our claims, we have our economic interests, but we are not involved in nuclear warfare. And the reason for AUKUS is to add maybe another eight Australian attack submarines so that every strategic submarine in the PLA Navy can be tracked and hunted down. Now, this is to me madness. You know, they are thinking of the possibility of a nuclear exchange. But when I was in the military, this was my job. I got to think through all this.
So, China knows that it must have an assured counter-strike capability because the US wants to deny China a counter-strike capability. So, from a few hundred warheads, it's going to increase it to maybe one or two thousand, I don't know. And we read that in Xinjiang, they're building many silos. So maybe for every ICBM, they may have two empty silos, like an MX game, you know, so that it's hard for the Americans to destroy everything in the first try. Now, if I was Taiwanese, think about this: in 10 years' time, China will have almost a certain counter-strike capability against the US. So at a conventional level, they may not prevail. At the nuclear level, the risks are too high. At that point, the pressure on Taiwan, political, military, economic pressure, is bound to grow. So therefore, the status quo is a ticking bomb. To say keep the status quo is to say let it tick. It will not take forever. In 10 years' time, it will be ticking much faster.
Lien Chan had always taken the position that it is better for Taiwan to negotiate with the mainland earlier rather than later because the longer you wait, the weaker your relative negotiating position. But of course, there are Taiwanese who believe that maybe if you wait long enough, something will happen to the mainland, some big struggle in the Communist Party, a new civil war, and then a path for Taiwan to escape and become independent. Lee Kuan Yew said, "Take Taiwan out from Egypt. Well, maybe one day the Red Sea will open. But you cannot base policy on such a possibility. It's too dangerous. It may happen, but it's not a high chance. And policy cannot be based on that." So from me watching this with some emotion, but not with the emotion of a Taiwanese, I say, no, better to negotiate now. Which is why we had a, which was why we had a free trade agreement under President Ma.
And there's this view that President Xi Jinping can't wait to invade Taiwan for his legacy. To me, this is not consistent with what he did in 2015 when in Singapore, President Xi met President Ma over dinner at the Shangri-La. At that time, I was with the Quark group. So I asked one of the Quarks, I said, "Who paid for the bill?" She told me, "50/50 down to the last cent." I remember President Ma brought Chiang Kai-shek and President Xi, of course, brought Quato Mai. I think both are equally good, equally strong. And the words spoken that evening were so moving. I mean, I'm not from Taiwan, not from the mainland, but I'm ethnic Chinese, and I was really moved by those words. And I remember talking to Robert Quark about it. He too was moved by those words and moved by the symbolism of that meeting where both sides transcended politics. They addressed each other as "Xing," not "Mister." "Mister" is the low-level way of addressing. "Xing" is the highest level of addressing each other. In other words, the key is to go up, not to go down.
But at that time, President Ma was already stepping down, and everyone knew that it was likely that Tsai Ing-wen would become president. With Vice President Vincent Siew's help, I called on Tsai Ing-wen after she was elected, before she was sworn in. She said that China did not have a positive attitude. I told her, I said, "In Singapore, Xi Jinping had opened the road for you." She did not respond to me, but she knew what I meant. But I knew that she could not take that road because that road requires her to accept a one-China consensus, and she could not take it. In the DPP constitution, it says our goal is an independent republic of Taiwan, even though both swore on the mainland of one China. So this is something which is very wrenching for green Taiwanese. They know that there is a road, but that road means that there could be a trap because one China may mean one PRC equal. So they say no. The alternative is a dead end and tragedy, not just for Taiwan and the mainland, but I think for Singapore and for the entire region, for the world, if there's war between China and the US.
This road is not a super highway, but it's not a bad road. And one China, the PRC did not say "one PRC policy." He says "one China." He did not say when he says he can discuss everything. So when Tulleon, whom I had dinner with last night, he was in America. He said there's no consensus on the one-China consensus. On the, he said, "I was just using the words of Fu Tze-tsai." Ambiguity, ambiguity is the key to the future. I mean, I do Taii for 15 years. Second line changing. If you define it too much, it disappears. So ambiguity is necessary. The mainland will accept some ambiguity. Taiwan should accept some ambiguity. The problem is the DPP constitution. Please excuse me if I speak out of turn, but this is it's my musing, my fantasizing. Maybe it is possible for the two sides to agree to some kind of a Chinese Commonwealth. Liu Lin talked about it. Vice President Lu Hsiu-lien talked about it. I wrote it in English. So I was told in Taiwan, translate it as "pang" not "lean" because "lean" has got other connotations there. There are too many other references.
There are precedents in Iceland. The Icelandic people met every year in the Rift Valley. They made laws. They talked about trade disputes. They passed judgments. They punished. Then they went back to the separate valleys. There was no executive, no common executive. It was called the Althingi. Althingi. It was Europe's earliest modern democracy. Then, if you study Switzerland, the Cantons came together to form the Helvetic Confederation. Again, they had no executive, but they met. They discussed common problems. So when we talk about one China, maybe we can talk about the one China Commonwealth where the two sides talk about trade, cooperation, problems, agree on certain principles without the need for a common executive. Can the mainland accept that? I think they can. Why do I say that? If you look at Macau, Macau in the 16th century was given to the Portuguese. It was not taken from the Ming dynasty because China wanted the Portuguese to have their own area and don't trouble me, and the Portuguese understood that it would never be a problem to China. The Qing dynasty renewed it. But in the 19th century, when China was being ravaged by the imperial powers, Portugal decided to take Macau. But they had a revolution in 1973, and they said, "We want to return Macau immediately to China." What did China say? China said, "No, no, no, we have to settle Hong Kong first. Please stay. Please stay." So it was only in 1999 that Macau returned to the mainland. And even to today, there is no practical change in how Macau is run or the way of life.
We do not know what China will be in 20 years' time. China today is very different from China 20 years ago. Unrecognizable from what China was 40 years ago. So, 20 years from now, 40 years from now, what will China be? What will Taiwan be? So in my three moments, it's something I play in my mind, the possibility of a Chinese Commonwealth where it comes together, where you maintain your links with America, but not to an extent which threatens China, where you maintain your links to Singapore and other countries, where Xi Jinping can still be in Taiwan with no problem. And I, but as I said, the problem is the party constitution of the DPP. Maybe it's possible you can't change the constitution, it's too difficult. But maybe it is possible for the various political parties in Taiwan to add a preamble of what one China means to Taiwan. What does it mean to Taiwan? So you make your position clearer, and leave the mainland to do what it wants, but you make your position clearer. And this is to the advantage of Taiwanese people because if you are divided in Taiwan, your position is weakened. But if among the political parties there is broad consensus about what it means for a prolonged period, a commonwealth, not a PRC, not an ROC, maybe by that time it's just called China, and you can apply this in the Olympic Games and other international organizations. That is a way forward. And I believe a little clarification on the Taiwan side will enable Taiwan to go back on the road which was opened by Xi Jinping and Ma Ying-jeou in Singapore in 2015.
It will only work if Taiwan is valuable to the mainland. What makes Taiwan valuable to the mainland? Why do Singaporeans and Hong Kongers and others like to visit Taiwan? It's its great physical beauty. The people are very cultured. The food is excellent. There is a common courtesy among young and old, even the foreigners. And there is a cosmopolitan feel to it. You're an American, a Japanese, you come to Taiwan, you feel, yes, you're comfortable. You may have some difficulty here and there, but basically, it's an international society. The other area where you have excelled is in semiconductors. You know, Vivek Ramaswamy, the Republican candidate, very clever, very eloquent, he said, "No, we must get TSMC to go to the US. Then in 10 years, we don't need Taiwan anymore. We can give it to China." He doesn't understand that TSMC is not just factories and individuals. TSMC grew up in an ecosystem, in a Taiwanese ecosystem. It cannot be replicated in America. It cannot be fully replicated in China. It cannot be replicated in Singapore. Why is that? To begin with, you are a very educated population, smart people. I'm so honored that the KTD Foundation, KTD was the father of all this, laid the foundation. You couldn't have done it without your mainland connection. You couldn't have done it without the American connection, without the Japanese connection. All these are layers in Taiwan society which makes you unique, special, and valuable to the mainland.
Convergence as equals will only work if Taiwan continues to be of value to the mainland. This is how Singapore conducts relations with China. There was a period when China needed Singapore for many things, but we know that for those things, China no longer needs Singapore. So we must continue to have things which China wants which it cannot develop for itself in Singapore, for us to be of continuing interest to China. And indeed, we do this for the entire world, that we only prosper by being of value, by contributing to the well-being of others. And this Taiwan must continue to do and can continue to do, provided your young people, your smart people remain in Taiwan, that even when they work overseas, in their hearts, they are still Taiwanese. That is the key.