To Satisfy Trump, Half of Government Budget Should Be Used on Defense
Comprehensive News Coverage by Taiwan Weekly
Bloomberg Businessweek published an exclusive interview with U.S. Republican presidential candidate and former President Donald Trump on July 16, in which he clearly discussed his Taiwan policy after returning to the White House if he wins the election. Mr. Trump said that Taiwan has seized the U.S. chip industry and is very rich. According to Mr. Trump, Taiwan should be paying the United States to defend it.
Robert O'Brien, White House national security adviser during Mr. Trump's presidency, further made it clear that Taiwan should increase its defense expenditure to at least 5 percent of gross domestic product (GDP) to demonstrate its will to defend itself. After conversion, the defense budget accounts for as high as 43 percent of Taiwan’s total annual budget expenditure; in other words, one of every two dollars of the total budget must be used for defense expenditure in order to meet the target.
In an exclusive interview on June 25, Mr. Trump was very indifferent to defending Taiwan from aggression. He believes that it is difficult to defend an island across the Pacific. “Taiwan is 9,500 miles away, but only 68 miles away from China.” Mr. Trump said that he knows the people of Taiwan very well and respects them greatly, but they did take 100 percent of the U.S. chip business and they are immensely wealthy. According to Mr. Trump, Taiwan should be paying the United States for its defense.
Mr. Trump also asked: "What has Taiwan done for us? We have protected Taiwan for many years, but they have stolen our chip industry. I am not sure what the point of us continuing (protecting) is."
Mr. Trump also has issues with the United States subsidizing the Taiwan Semiconductor Manufacturing Company (TSMC) to build fabrication plants. “Now we’re paying them huge sums of money to make new chips in our country, and then they’re going to take it away; in other words, they’re going to make it, but then they’re going to take it back to their country,” he said. Mr. Trump also said that Taiwan’s chip factories are a treasure in the eyes of Chinese President Xi Jinping, so China is unwilling to bomb Taiwan.
Mr. Trump’s remarks add to the uncertainty about his Taiwan policy if he wins the presidential election. Bloomberg reported that abandoning its commitment to Taiwan symbolizes a huge change in American foreign policy, and is as significant as stopping aid to Ukraine, but Mr. Trump seems ready to fundamentally change these relations.
Foreign Policy indicated on July 17 that American policy will depend on how deeply Mr. Trump intervenes on Taiwan. If Mr. Trump takes a strong lead in terms of national defense, then he may ask Taiwan to increase its defense budget or cut off military aid approved by current President Joe Biden. He may push for chips manufactured by the United States, and may even trade with Beijing at the expense of Taiwan’s future.
The Office of the President did not respond to Mr. Trump’s remarks. Premier Cho Jung-tai said that U.S.-Taiwan relations have been quite robust in recent years. Peace and stability in the Taiwan Strait and Indo-Pacific region are our shared responsibilities and goals. Taiwan is willing to shoulder more responsibilities to defend Taiwan and ensure security. Taiwan has a vertical industrial chain and scientific and technological talents. According to Premier Cho, Taiwan is confident that high-end technology will stay in Taiwan. This is the best choice for Taiwan.
Chairman Ko Wen-je of the opposition Taiwan People’s Party (TPP) asked, “Protection money? Who has to pay whom?” Ko said that Taiwan is guarding the first island chain and “helping him (the United States) block here, do you still want us to pay him?”
Chairman Eric Chu of the Kuomintang (KMT) stated that while U.S. presidential election campaign is heating up, the most important thing is that the Republic of China must be independent and self-reliant; the DPP has long relied on the United States to resist China, while the KMT advocates being pro-American and China, friendly and cordial with the United States, and also reducing the risk of war through cross-strait dialogue and exchanges, it is an absolutely wrong policy to rely entirely on the United States.
Mr. Trump’s “protection fee” claims against Taiwan triggered heated discussions. Spokesman Matthew Miller of the U.S. Department of State responded at a regular press conference on July 17 that Taiwan has been purchasing military equipment from the United States to the tune of billions of dollars, which is also very important to the American economy. Citing the security cooperation that the United States has provided over the decades, Miller said Taiwan has purchased necessary military equipment and that it has not been in any way charity from the United States.
On the same day, Mr. O’Brien pointed out in an interview that Trump meant to imply that Taiwan should invest more in self-defense. Mr. O’Brien believes that Taiwan must increase defense spending to at least 5 percent of GDP. "We need to see the will of the Taiwanese people." He described Taiwan as facing a monster across the Taiwan Strait, and the proportion of defense expenditure in its economy must be at least equal to that of China.
According to reports from Politico and Reuters, although Mr. O’Brien is not a member of Mr. Trump’s campaign team, if Mr. Trump wins the election, Mr. O’Brien may return to serve as the White House national security adviser or assume an important foreign policy position.
Chie Chung, associate researcher at the National Policy Foundation, analyzed that taking 2024 as an example, Taiwan’s GDP is estimated to be NT$24.56 trillion (about US$748 billion), and the central government’s total annual expenditure is about NT$2.88 trillion (about US$87 billion). According to Mr. O'Brien, then the annual budget of the Ministry of National Defense will need to be NT$1.228 trillion (about US$37 billion), accounting for 43 about of the central government’s total annual budget expenditure. “There is simply no democratic country that can prepare a budget like this during non-war periods.”
KMT Legislator Ma Wen-chun, member of the Foreign Affairs and National Defense Committee of the Legislative Yuan, criticized, “The weapons purchased have not arrived yet, but the new bills have arrived first.” Why did President Lai Ching-te not even dare to say a word in the face of tough U.S. demands? Please ask the United States to first deliver the weapons we have paid for within a reasonable range, and then talk about increasing the defense budget.
DPP Legislator Wang Ting-yu, also a member of the Foreign Affairs and National Defense Committee, said that Mr. O’Brien made the suggestion as a private friend. This is a very complicated issue. The defense budget has increased by 60 percent under former President Tsai Ing-wen over the eight years, from 2 percent of GDP to 2.5 percent in response to the call.