Will an Anti-DPP Coalition be formed?

* Though the 2024 presidential election is still five-plus months away, the list of contenders remains in a state of flux. Other than the ruling Democratic Progressive Party's (DPP) nominee, William Lai, the opposition camp--including the Kuomintang (KMT), the Taiwan People's Party (TPP), and Foxconn founder Terry Gou--remains divided and far from forming a united ticket to compete against the DPP. As such, most polls believe, if the election were held today, Lai will handily win the race with approximately 38-40% of the popular vote.

* The opposition camp knows the math well, and neither the KMT nor the TPP stands a chance at winning all the marbles. Though efforts have intensified behind the scene, progress has been limited to sporadic photo-ops. This has made the rank-and-file very antsy and allegiance divided. The KMT plans to hold its plenary session on July 23 to make Hou You-yi's nomination official. The remaining challenge is to: (1) whether Gou would return to the KMT after an unsuccessful nomination bid, and (2) whether an unified ticket is possible with TPP's Ko Wen-je?

* Unity has always been a lofty goal for the KMT, beginning with the division between Lian Chan and James Soong in the 2000 presidential election. In a fundamental sense, unity has been the Achilles' Heel for the KMT for many decades. Things are not particularly promising in this election cycle.

* The attention then turns to former Taipei Mayor Ke, specifically whether he would stay in the race until the end. Ke has positioned himself comfortably at the second place in recent polls, with a sizable lead over others for those 40 and under. It's hard to imagine that Ke's poll number would fluctuate much, but the lead he currently enjoys over Ho could narrow. If, and when, that happens, the KMT may be in a better position to negotiate with the TPP on forging an alliance, or forming a combined ticket. The race to gain an outright majority would be another area of give-and-take. Though trained as a physician, Ke has become a shrewd politician after serving as Taipei mayor for eight years. He will make the deal when he gains a solid footing in the domestic political landscape and senses the upside far outweighs the negatives.       

 What Would Gou Do Next?

* The opposition Kuomintang (KMT) will hold a party plenary meeting on Saturday, July 18, at which time it will make the nomination of New Taipei Mayor Hou You-yi for president official. Though the session is just days away, many moving parts are still in play that would make Hou's expected nomination uncertain, unpredictable, and uncomfortable, at least for some.

* The biggest question centers around the true intentions of Foxconn founder Terry Gou and his next step. While some still grabbing onto the slim chance that the KMT would change its presidential nominee, like it did in 2016, and go with someone like Gou instead. In addition, the party is clearly divided between those supporting Hou and those supporting Gou. There is no indication that the intra-party healing is imminent, or set to begin soon after July 18.

* Unity has always been a big problem with the KMT. Though reasons are many, most of which have centered on the party's practice of doing things in "the black box." The lack of transparency creates resentment and raises doubts about fairness. For a party deeply rooted in fifty years of monopoly on power, it is a hard habit to break as the privileged few continue to manipulate relations among the contending factions and personalities.

* We don't anticipate a last-minute change of the KMT presidential nominee, and we also believe the KMT will fare poorly at the polls next January 13. In all likelihood, Gou WILL NOT rejoin the KMT. In fact, he's been planning an islandwide signature drive to meet the thresholds necessary as a write-in, independent candidate. It will be a long and arduous process and a severe test of the collective will behind Gou's presidential ambition. We'll find out in the next few months.

Rapid Changes in Public Opinions

 * In an election year, opinion polls are the most readily available indicator of how the campaign is going for each of the candidates. For Taiwan's presidential race in January 2024, there have been subtle changes that may evidence a dominant two-party system in Taiwan is under closer scrutiny and a changing political landscape is coming.

* According to the latest poll numbers, the ruling DPP has dropped over 6% in party approval and support ratings, while the KMT suffered another 5% decline from last month. Worse yet for the KMT, the former Taipei Mayor Ke Wen Je-led Taiwan People's Party (TPP) has overtaken the KMT and captured the second place behind the ruling DPP in the same category.

* Though most believe the TPP has the momentum and the support, especially among voters 40 and under, to make a significant impact in the campaign, most didn't expect that upward thrust would come so strongly, and push the KMT to the third place so quickly. If this pattern holds, Ke, as TPP's presidential nominee, is in position to fortify his candidacy and elevate the relevance of TPP in Taiwan's democracy.

* While the election is still seven months away, the KMT is cautioned not to be perceived, or always stay, in third-place from here on out. If that perception sticks, it's very difficult, if not impossible, for the KMT to be considered seriously in future islandwide campaigns. Its presidential nominee, New Taipei City Mayor Hou You-yi, is currently embroiled in a kindergarten controversy with alleged misuse of medicine. More importantly, the inability to repair divisions from its primary has long remained the party's Achilles' Heel that would further undermine its political stature and influence domestically.

 Dialogue, Dialogue, and More Dialogue

* Director of the American Institute in Taiwan (AIT), Sandra Oudkirk, made a statement that could signal a subtle policy shift in the U.S. management of cross-Strait relations.

* Ms. Oudkirk declared that, "Dialogue is good. Dialogue is useful," on Friday, June 9, in Taipei. At a time when Washington is seeking dialogue with China, the U.S. encourages the three Taiwan's presidential candidates--DPP's William Lai, KMT's Hou You-yi, and TPP's Ke Wen-je--to do the same.

* Although the U.S. has always welcomed cross-Strait dialogue between the two feuding neighbors, this time could mark the beginning of a more conciliatory approach toward China that the U.S. would like to see taking place before things get out of control, in and around the Taiwan Strait. The biggest threat has always been the risks of miscalculation, or misinterpretation, since cross-Strait dialogue has been shut down completely since 2016 when Tsai Ing-wen became president.

* Since Beijing has preconditioned the acceptance of the 1992 consensus before resumption of dialogue, it seems highly unlikely, if not impossible, that the Tsai administration would make any overture before the January 2024 presidential election.

* Among the three candidates, Lai once prided himself as a "pragmatic pro-independence advocate" is the least likely among the three to propose any concrete steps to resume dialogue. While Hou may be in a better position to make dialogue a reality after taking over the presidency, he has been elusive and reluctant to express his view toward the 1992 consensus, or his policy approach toward China. As for Ke, he does not appear to be a man of deep, personal convictions, especially on sensitive issues like cross-Strait relations. He would, however, periodically throw out ideas deemed appealing to the segment of the electorate, or the international audience, at that time. So, it seems too early to call if the resumption of cross-Strait dialogue appears imminent.

 Risk of Marginalization

* According to the latest opinion polls, KMT presidential nominee Hou You-yi  has fallen further behind to third place, behind DPP's William Lai and TPP's Je Wen-je. This has put many rank-and-file members on the edge and are calling for replacing Hou, possibly with Foxconn founder Terry Gou. Though that possibility is remote at best, Hou has done very little, if anything, to repair intra-party cleavage and division since his nomination on May 17.

* In fact, Hou has spent the bulk of his time visiting retired, aging KMT politicians, "seeking wisdom" and accumulate support. This is a VERY, VERY old-fashioned campaign style once championed by the KMT in the 1990s. But most of the electorate does not know, or remember, these older generations of KMT leaders, especially for those 40 and under. In addition, Hou has avoided answering key questions on cross-Strait relations with China and Taiwan's nuclear energy. He might have been able to dodge those questions when he wasn't the nominee, but now as the nominee, his reluctance to respond has been largely interpreted as an indication that he is not ready to lead. That does not bode well for Hou and the KMT.  

* To be frank, Hou has never been a charismatic political leader. As a former policeman, his low-key, no-nonsense approach might have been great in crime-fighting, but that style is clearly outdated in Taiwan's animated domestic politics today. Moreover, he is especially behind the other two contenders among those under 40 and those with higher educational background. Sadly he has done little to broaden ties and deepen understanding with those voting blocks.

* Making the matter worse, Hou has not consolidated his campaign team with those at the KMT HQ. His lack of progress at integrating the two is, at least partially, a reflection of his plans to remain somewhat apart, on some policies, from the KMT. The intent might have been to try and capture those considered "middle-of-the-road," but the result so far has been the inability to solidify support first among the KMT grassroots. Though there's still time to turn things around, there's no indication that Hou's rebound in poll standing is either immediate or imminent. Stranger things have happened under similar circumstances in the past.