From the campus of Soochow University to the Executive Yuan, Premier Liu Chao-shiuan has in a brief spell swapped identities and taken a new turn in life. Faced with crushing pressure and withering criticism, how does he assess his position? In an interview with CommonWealth Magazine, Liu offered some of his thoughts.

Q: Could you discuss some of your policy ideas?

A: The first policy situation we encountered was economic in terms of overall international economic trends. We were in a tough spot.

Commodity prices have been seriously distorted over the past six months. For six months, prices were not raised. In fact, the pressure of rising commodity prices with all its explosive force was put on the back burning, waiting for us to lift the lid. In terms of oil, prices rose nearly 50 percent in the period between the start of the oil price freeze in November 2007 and the restoration of the market mechanism in May. Were we to lift the lid off the pressure cooker, prices would shoot up by NT$6.5 [per liter of gasoline] in one go, and society can't deal with that. Some economists believe prices should be raised to reflect the market at one go, but our playbook is half economics and half sociology. We must consider the view of society, so we did not immediately raise prices to reflect the market.

Speaking of price fluctuations, I'm confident we're not at the point of losing control. The consumer price index (CPI) for January through May rose 3.7 percent. We're hoping that with this kind of management, by the end of the year we can bring it down to 3.3 percent on the year.

We also considered macroeconomic impact – that is, expanding domestic demand. Don't some say expanding domestic demand fuels inflationary pressure? That is, of course, two sides of the same coin. A well-executed domestic demand stimulus package till the end of year could add 0.45 percentage points onto overall economic growth. Domestic demand is certainly linked to a stimulated job market, as with small-scale infrastructure projects, for example.

A Feasible Plan

Q: With a budget of NT$116 billion, many see this as excessive pork. What are your views?

A: The Directorate General of Budget, Accounting and Statistics in February gave an initial economic growth forecast of 4.32 percent. But if we do this we can add another 0.45 percent to achieve nearly 4.8 percent growth. We believe it's a feasible plan.

Part of the plan is less about expanding domestic demand than about bailing out various local governments. With a worsening financial crisis and much of their funds tied up in interest-bearing investments, we've set aside NT$20 billion in assistance.

For the NT$58 billion set aside for local government applications for public works projects, we have a number of criteria. But the real issue was a lack of time. This administration took office May 20 and the legislature demanded a proposal by May 26.

In fact, we understand that most county and city governments do not have an endless list of demands. Does that mean city and county councils don't ever make ridiculous proposals? Of course they do. Does that mean we will grant them their ridiculous proposals? Of course not. In any event, these things don't always turn out the way as some reporters see them, as with the absurd newspaper story about funeral parlors. The guy who wrote that is really living in another dimension. Funeral parlors are extremely important and, like hospitals, occupy a place in the cycle of birth, life and death. At the local level, the funeral parlors are never included in the budget; with ordinary budgeting they will always be a back-of-the-line priority. Once they have become old and decrepit, however, a progressive city will look to institute appropriate planning. Personally, I don't think it's an absurd plan.

Q: Did the Legislative Yuan feel they had not been consulted with regard to the domestic demand stimulus plan?

A: There are 80-odd lawmakers who will complain if we don't talk to them. On the other hand, if we consulted some of them, but not all of them, the complaining would take place all the same.

If we had been given two more weeks we could have really done it beautifully. And it would have been completely transparent for all to see just what projects the central government is assisting and which projects have been proposed at the local level.

An Avenue for Venting

Q: Are there many lawmakers who feel they have not received due respect since President Ma Ying-jeou took office?

A: Beginning with his election, there have been a lot of people with opinions about everything surrounding President Ma. For now, the only place they have to rail against is the Executive Yuan. Once the euphoria was over, this climate emerged. They need to vent, and at this time, it's just as well that everyone has an avenue for their venting.

Q: You have been the target of a succession of tirades in the Legislative Yuan. How does that make you feel?

A: Yesterday I had a lawmaker call me "shameless," something I've never been called before. So I proceeded to tell her she should be careful of the language she used. These are the halls of parliament and you are questioning the premier – using that sort of rhetoric is a loss of face for the 23 million people of Taiwan. She quickly changed the subject.

Some people say I'm speaking too gruffly and that speaking so harshly to women is not good. But sometimes I'm just cutting them off before they say something even more despicable. You never know what they'll say next.

Screaming matches are a common occurrence. I don't know how many screaming matches I had with lawmakers when I was transportation minister. I've grown much softer these days.

Q: The government keeps saying better days are just around the corner, but is that too much to expect? Some are fondly recalling how the DPP administration's Vice Premier Lin Hsin-yi bluntly told people to prepare for hard times. He was telling it straight.

A: Not necessarily hard times, but we must prepare for times of great challenge. If we remain competitive, we'll get by and need not suffer hard times. For example, we will not be the only beneficiaries of cross-strait opening. Mainland Chinese banks will come, as will mainland Chinese students and white-collar workers, and we must be prepared to compete.

Q: Under the circumstances, what can people do to boost their competitiveness?

A: My administration is thoroughly versed in two key concepts: one is energy policy and the other is human resources policy. For future sustainable development, we must have resources. What makes energy so important is the fact we don't have any. The only thing we do have is human resources.

So, of two equally important resources, one we have and the other we don't.

Fight the Good Fight

Q: What if the economic growth rate this year fails to meet projections?

A: That would be a discrepancy between how we run our administration over the first six months and what we expect to happen. We would have to accept the responsibility for that outcome. I'm already over 60 years old, and I've said before, this is my final battle. If I am unable to fight the good fight, then by all means find someone else to fight it. I won't cling to my post.

Q: Do you feel Cabinet members need to make any adjustments?

A: They are all very bright and capable people. I think they'll have to quickly become accustomed to the culture of the Legislative Yuan and the media culture.

Q: You've led a pretty charmed life, yet at this stage in your life you're still out there taking the heat from the media and in the Legislative Yuan. What are your ambitions?

A: President Ma was able to get himself elected, and we share a number of common ideas. He wants to do a good job. He told me that at this point in time I was most capable of helping him get things done. I was persuaded, and since I was persuaded, I might as well give it my full effort. I actually have no personal ambitions. In all my past positions, I've never said I wanted things this way or that. I often say, it's not really important what you like – what really matters is to like to do what you're doing. Now, what makes you like what you do? Doing it in a way that gives you a sense of accomplishment.

Translated from the Chinese by Brian Kennedy

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Chinese Version: 劉兆玄：我不戀棧，也不輕易言退