The TAIPEI Act Is an Act of Wishful Thinking

The U.S. Senate unanimously passed the Taiwan Allies International Protection and Enhancement Initiative (TAIPEI) Act in late October 2019. If the TAIPEI Act passes in the House of Representatives, it will be passed to President Donald Trump to sign the bill into law.

The Act represents American lawmakers’ carrots-and-sticks approach to counter Chinese coercion against Taiwan, which today has just 15 diplomatic allies. Seven countries have broken off relations with Taipei in favor of Beijing since President Tsai Ing-wen took office in 2016. The TAIPEI Act involves the United States enhancing “economic, security, and diplomatic engagement” with countries that have “strengthened, enhanced, or upgraded relations with Taiwan,” while also punitively reducing U.S. engagement with countries whose actions “undermine Taiwan.”

Other provisions in the Act include calling on the U.S. administration to advocate for Taiwan’s membership in “international organizations in which statehood is not a requirement” and for Taiwan to be granted observer status in international bodies where formal recognition is a prerequisite. It further proposes signing a U.S.-Taiwan free trade agreement.

Given the bipartisan support for Taiwan in Congress and the broad anti-China sentiment in Washington, the bill will almost certainly be passed into law. This follows closely on the heels of the Taiwan Travel Act – another piece of legislation that displays Washington’s support for Taipei – passed in March this year.

But the TAIPEI Act is very unlikely to achieve its intended objectives to provide diplomatic and economic support to Taiwan through the threat of reduced aid and engagement with states assessed to turn away from Taipei toward Beijing. Instead, it is likely to be an act of wishful thinking by the United States – a “white elephant” law that widens the U.S.-China schism over what Beijing views to be a core national security and sovereignty issue, and further strains the terse relations across the Taiwan Strait, all without achieving its key purpose.

Three factors explain why the TAIPEI Act will not, as Congress expects, change the behavior of states choosing to lean toward Taipei away from Beijing.

First, it is unrealistic to suggest that the proposed punitive measures on states that “undermine Taiwan” will discourage these actions.

In practical terms, whatever Washington decides to do to revoke support from these said states, Beijing can equally offer – and perhaps more. The consequences to states that are targeted by the TAIPEI Act can be negated if Beijing so chooses to flex its considerable economic and diplomatic muscle, which it will if the Chinese government’s intent is to force Taiwan’s diplomatic partners to choose sides across the straits.

In other words, China can fill the void left behind by the United States, if the latter does exercise powers under the TAIPEI Act to punish states for abandoning Taiwan by withdrawing its engagements. The states in question are unlikely to be punished as Washington would like, since they will be rewarded by Beijing for their decision.

Indeed, the law, if and when passed, will be viewed by Beijing as a poke in the eye and could precipitate a tit-for-tat escalation of diplomatic overtures to Taiwan’s remaining allies. This may further expedite what the United States hopes not to happen – Taiwan’s continued diplomatic isolation.

Second, the TAIPEI Act is unlikely to steer states away from Beijing toward Taipei, as the cross-strait power disparity is stark and apparent.

The “choice” between China and Taiwan is not merely about U.S. economic aid or diplomatic engagement. While the TAIPEI Act targets these specific aspects, this is a unidimensional approach, because states that are currently deciding between the two sides of the Taiwan Strait are considering how they can better benefit in terms of their economic, trade, developmental, and security objectives.

When comparing Beijing and Taipei, the strategic calculus by most states is clear – it is in the interest of states to align with the country that continues to be on an upward trajectory in all aspects of its national power and is on its way to be the pre-eminent power in the Asia-Pacific. The enactment of the TAIPEI Act does not, by itself, do enough to swing calculations in Taipei’s favor.

Ultimately, the cross-strait power gap will only continue to grow, and it will be increasingly difficult for Taiwan’s existing diplomatic allies to maintain the position of closing themselves off to China – even with promised U.S. support.

Third, Congress may have overestimated the ability of the United States to play cards that can change the calculations of Taiwan’s diplomatic partners.

Washington today lacks both the hard economic heft as well as the soft moral and persuasive power to convince states to take Taiwan’s side – as compared to the resources that Beijing can muster at cross-purposes to the United States. In addition, Washington faces a credibility issue – even as the U.S. takes measures to support Taiwan and adopts punitive steps to punish states that undermine it, the reality remains that the United States itself is not Taiwan’s formal diplomatic ally. The moral ground on which it stands to insist that other states do not swing toward China is shaky at best.

States can also reasonably doubt if Washington will follow through on supporting Taipei. Implementing the TAIPEI Act runs the risk of undercutting other U.S. foreign policy interests in pursuit of one specific interest to assist Taipei. If the United States takes action against a state that breaks off diplomatic relations with Taiwan, it is in effect saying that its foreign policy toward said state is subservient to its relationship and interests with respect to Taipei.

One can wonder if American prioritization of Taiwan over other states is sustainable or realistic over the long term, as U.S. foreign policy interests wax and wane. States that realize this may then be less inclined to believe that Washington will indeed take concrete action as outlined in the TAIPEI Act.

There is a clear and valid policy intent that Congress wishes to achieve with the passage of the TAIPEI Act. However, from the geostrategic perspective and looking from the lens of the states that may be affected, enacting and implementing the provisions within the law will exact costs from both the U.S. and Taiwan, with – at best – murky chances of success. The likelihood that this move backfires is high.

On balance, inaction – and hence retaining some ambiguity – may be a better response than a step that further destabilizes the increasingly untenable cross-strait balance.