Postwar Taiwan and the USA

by Denny Roy
Chiang Kai-shek, March 1945 (Library of Congress Prints and Photographs Division, LC-USZ62-39907)

Taiwan has been a showcase of liberalization under American encouragement, but also the primary irritant in US-China relations. A large island with a population of twenty-three million located about 100 to 150 miles off the coast of China, Taiwan is contested on two levels. Long-established Chinese communities have developed a national identity separate from mainland China. Other Taiwan residents are descendants of postwar Chinese immigrants who believe Taiwan is part of and should ultimately reunite with China. The Democratic Progress Party (DPP) represents the former group, the Kuomintang (Nationalist Party) the latter. Furthermore, ownership of Taiwan is disputed between the remnants of the Republic of China (ROC) government that previously ruled all of China, and the Chinese Communist Party government that pushed ROC officials and armies off the Chinese mainland in 1949.

During the Pacific War (World War II in the Asia-Pacific region), influential American media portrayed China as a brave resistor of Japanese aggression and its KMT leader Generalissimo Chiang Kai-shek as a reformer interested in democracy and Christianity. His glamorous US-educated wife Madame Chiang (Soong Mei-ling) became a popular and effective advocate for increased US support to China. In 1943 the United States finally repealed the 1882 Chinese Exclusion Act, which had all but banned Chinese immigration. Washington treated Chiang as one of the major leaders of the Allied Powers. But after the war, as the Chinese Civil War turned decisively against the KMT government, the Truman administration decided that Chiang’s government was irredeemable and cut off American military aid. Some of the realities of KMT rule in China—massive corruption, economic mismanagement, callous and sometimes brutal treatment of the population, and frustration among US military commanders with Chiang’s strategic decision-making—were little known among the US public. Americans were therefore shocked to observe the rapid conquest of Chiang’s KMT forces by a Mao Zedong–led communist insurrection. The question of “Who lost China?” became a major issue in US politics from 1949 through the presidential campaign of 1952. Conservative politicians such as Wisconsin Senator Joseph McCarthy accused the Truman administration of harboring officials who engineered the defeat of the ROC government because they were sympathetic to Chinese communism.

Washington hoped Taiwan would remain out of Mao’s hands but under a different, more liberal government than Chiang’s, one that would not be vulnerable to communist subversion. This possibility disappeared when the remnants of the ROC government, military forces, and elite class relocated to Taiwan in 1949. US strategic planners ruled out American military action to save Taiwan from Chinese conquest. CCP forces were poised to invade Taiwan in the latter half of 1950. In June 1950, however, the outbreak of the Korean War caused a reassessment of US strategy. Since communism appeared to be going on the offensive, the Truman administration announced that the US Navy would prevent Chinese forces from attacking Taiwan. The Korean War probably saved the ROC. To maintain the rump “free China,” America was stuck protecting Chiang. Taiwan had a strong lobby of supporters in the United States and a legacy of prewar American missionary experience in China as well as the pro-ROC sentiment built up during the Pacific War. The PRC, on the other hand, was what we would now call a “rogue state,” especially after China’s intervention in the Korean War.

The alliance was rocky. Washington and the KMT government disagreed on grand strategy, a repeat of the World War II experience. Chiang insisted the goal should be to prepare his forces to attack and “liberate” the mainland; US officials considered this idea unrealistic and insisted Chiang should concentrate on defending Taiwan. Taipei raised the issue of invading the mainland several times during the 1950s and 1960s, each time meeting a US rebuff. China tested this weak point in the relationship by threatening two small ROC-held islands near the Chinese coast that were within the range of Chinese artillery fire. Chiang wanted to keep these islands as staging points for an invasion of the mainland and packed them with troops, which the Americans thought was excessively risky. In the Taiwan Strait Crises of 1954–1955 and 1958, China shelled these islands and threatened to invade them. In both cases the United States signaled a willingness to help defend the islands and the Chinese backed down, but US-Taiwan tensions spiked as well. Twice, in 1974 and again in the late 1980s, Washington forced Taiwan’s government to shut down nascent nuclear weapons programs.

Taiwan was the home of one of the Cold War “friendly dictatorships”: illiberal governments with which Washington partnered because they were anti-communist. Taiwan’s political system allowed only the KMT to rule and maintained a permanent state of martial law, with severe constraints on civil and political liberties and harsh punishment of dissidents. Until the 1990s the KMT government, like the CCP, had a Leninist party structure originally designed by Soviet advisors. US officials pushed the ROC government toward political liberalization. KMT leaders considered this American pressure arrogant and naïve, the downside of their dependence on American economic and security assistance. The 1984 murder of Chinese American journalist Henry Liu on US soil badly tarnished Taiwan’s image in the United States and increased the American public’s awareness that the ROC was little more politically “free” than the PRC. Gangsters contracted by ROC government officials shot Liu to death at his home in California shortly after he wrote a book critical of the ROC president. Senator Claiborne Pell and Representative Stephen Solarz led calls for more pressure on the KMT to discontinue martial law and release imprisoned dissidents.

The ROC government continued to occupy the “China” seat in the United Nations after the CCP had established the People’s Republic of China on the mainland in 1949. Through the 1950s and 1960s the US delegation tried to keep off the agenda a proposal to consider the PRC for UN membership. Pro-PRC sentiment, however, was gradually building in the UN General Assembly. The US and ROC governments squabbled over strategy and stopped coordinating their efforts. Sensing defeat, ROC representatives walked out of the UN shortly before the General Assembly voted to give Beijing the China seat in October 1971.

With the Soviet Union as a common adversary, Washington and Beijing sought rapprochement with each other. President Nixon famously told ROC Vice Premier Chiang Ching-kuo during the latter’s visit to Washington in 1970, “I will never sell you down the river.” Nixon’s visit to China in 1972 caused great anxiety and anger in Taiwan. Taiwan was a potential stumbling block for improved Sino-US relations that would require expert diplomatic finesse. In the Shanghai Communiqué of February 1972, the US position was that Taiwan is part of “China.” This proclaimed a US “one-China” policy (meaning Washington could not have normal diplomatic relations with both Taipei and Beijing), but also left the definition of “China” ambiguous—i.e., it didn’t necessarily mean the CCP government in Beijing. After a delay in momentum because of the Watergate scandal, Washington established formal diplomatic relations with China in January 1979, simultaneously breaking them with Taipei and announcing an end to the US-ROC Mutual Defense Treaty. Protests broke out in Taiwan and the Carter administration came under heavy criticism at home. Many of Taiwan’s people believed this was the third time the USA had sold them down the river, after the cutoff of aid during the Chinese Civil War and the ROC’s expulsion from the UN.

Some Americans agreed. Barry Goldwater led a group of conservative members of Congress who sued US Secretary of State Cyrus Vance in US federal court, arguing it was illegal for the executive branch to abrogate the US-Taiwan alliance. Pro-Taiwan members of Congress sponsored the April 1979 Taiwan Relations Act, which provided for an alternative system of non-official US-Taiwan relations and committed the US government to ensure that Taiwan maintained a “sufficient self-defense capability.” US arms sales to Taiwan were a potential deal breaker for China. In an August 1982 agreement with Beijing, the US government pledged not to increase the quality or quantity of arms sales to Taiwan and to “gradually reduce” sales. Since then, however, the US government has argued that the promise to curtail or end arms sales is based on the implicit condition of a peaceful resolution of the cross-Strait issue—meaning the USA reserves the right to increase arms sales if China threatens to use force against Taiwan. Arms sales have indeed continued, with bitter complaints from the Chinese that Washington is flouting the agreement.

Taiwan was one of the East Asian postwar “miracle” economies for which the United States deserved partial credit. The US government provided significant economic aid and advice. The Joint Commission on Rural Reconstruction, founded in 1948, recruited a staff of mostly American experts who helped shape Taiwan’s successful 1948–1953 land redistribution program. US officials consistently urged Taiwan’s government to privatize the economy and to create a welcoming environment for foreign investment. US grants provided much of Taiwan’s capital formation and helped build economic infrastructure. Taiwan succeeded so well that it came under criticism from the US business community in the 1980s. Notorious for violating intellectual property rights and for producing cheap knockoffs of famous brand products, Taiwan had an inordinately large trade surplus with the United States and held the world’s largest stock of foreign currency reserves, indicating it was no longer a developing country that needed privileged treatment. Threats of American economic retaliation and protectionism forced Taipei’s government to make painful adjustments that reduced the trade imbalance.

Taiwan’s democratization roughly coincided with the end of the Cold War in 1990. The ROC government legalized opposition parties in 1987 and held its first direct presidential election in 1996. Americans celebrated the triumph of democracy in Taiwan, but more accountable government also meant a release of previously suppressed Taiwan nationalism, or what Beijing termed “separatism.” The PRC was publicly committed to go to war if necessary to prevent permanent and formal Taiwan independence. In addition to deterring the PRC from attacking Taiwan, Washington now perceived it needed to deter Taiwan from provoking China. The 2000 election of Chen Shui-bian, Taiwan’s first non-KMT president, forced the United States to confront the tension between values and interests in US foreign policy. Chen’s DPP viewed Taiwan as a separate country from China. Chen’s policies took small steps to emphasize that position while avoiding the acts that would immediately trigger a war with China. Beijing prevailed upon Washington to halt the trend. Bush administration officials obliged by publicly warning Taiwan against “unilateral changes in the status quo.” Washington could not support Taiwan’s self-determination if this meant trouble with increasingly powerful and important China.

This Taiwan-caused dissonance for Americans between values on one hand and economic and strategic interests on the other hand subsided with the election of KMT candidate Ma Ying-jeou as president in 2008. During his two terms in office, Ma reduced cross-Strait tensions by deepening economic cooperation with China. The future, however, will likely challenge the US-Taiwan relationship. China’s increasing military, economic, and political power raises the costs to America of defending Taiwan, while the Chinese government shows signs of impatience in the lack of progress toward its goal of politically unifying Taiwan with the PRC.


Denny Roy is a Senior Fellow at the East-West Center in Honolulu, Hawaii. He is the author of many books on foreign policy and international relations, including Return of the Dragon: Rising China and Regional Security (Columbia University Press, 2013), The Pacific War and its Political Legacies (Praeger, 2009), and Taiwan: A Political History (Cornell University Press, 2003).

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