[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]





                      WHY TAIWAN MATTERS, PART II

=======================================================================

                                HEARING

                               BEFORE THE

                      COMMITTEE ON FOREIGN AFFAIRS
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                             FIRST SESSION

                               __________

                            OCTOBER 4, 2011

                               __________

                           Serial No. 112-70

                               __________

        Printed for the use of the Committee on Foreign Affairs









 Available via the World Wide Web: http://www.foreignaffairs.house.gov/

                                _____

                  U.S. GOVERNMENT PRINTING OFFICE
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                      COMMITTEE ON FOREIGN AFFAIRS

                 ILEANA ROS-LEHTINEN, Florida, Chairman
CHRISTOPHER H. SMITH, New Jersey     HOWARD L. BERMAN, California
DAN BURTON, Indiana                  GARY L. ACKERMAN, New York
ELTON GALLEGLY, California           ENI F.H. FALEOMAVAEGA, American 
DANA ROHRABACHER, California             Samoa
DONALD A. MANZULLO, Illinois         DONALD M. PAYNE, New Jersey
EDWARD R. ROYCE, California          BRAD SHERMAN, California
STEVE CHABOT, Ohio                   ELIOT L. ENGEL, New York
RON PAUL, Texas                      GREGORY W. MEEKS, New York
MIKE PENCE, Indiana                  RUSS CARNAHAN, Missouri
JOE WILSON, South Carolina           ALBIO SIRES, New Jersey
CONNIE MACK, Florida                 GERALD E. CONNOLLY, Virginia
JEFF FORTENBERRY, Nebraska           THEODORE E. DEUTCH, Florida
MICHAEL T. McCAUL, Texas             DENNIS CARDOZA, California
TED POE, Texas                       BEN CHANDLER, Kentucky
GUS M. BILIRAKIS, Florida            BRIAN HIGGINS, New York
JEAN SCHMIDT, Ohio                   ALLYSON SCHWARTZ, Pennsylvania
BILL JOHNSON, Ohio                   CHRISTOPHER S. MURPHY, Connecticut
DAVID RIVERA, Florida                FREDERICA WILSON, Florida
MIKE KELLY, Pennsylvania             KAREN BASS, California
TIM GRIFFIN, Arkansas                WILLIAM KEATING, Massachusetts
TOM MARINO, Pennsylvania             DAVID CICILLINE, Rhode Island
JEFF DUNCAN, South Carolina
ANN MARIE BUERKLE, New York
RENEE ELLMERS, North Carolina
ROBERT TURNER, New York
                   Yleem D.S. Poblete, Staff Director
             Richard J. Kessler, Democratic Staff Director











                            C O N T E N T S

                              ----------                              
                                                                   Page

                               WITNESSES

The Honorable Kurt Campbell, Assistant Secretary of State for 
  East Asian and Pacific Affairs, U.S. Department of State.......     9
Peter Lavoy, Ph.D., Principal Deputy Assistant Secretary of 
  Defense, Asian and Pacific Security Affairs, U.S. Department of 
  Defense........................................................    20

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

The Honorable Kurt Campbell: Prepared statement..................    11
Peter Lavoy, Ph.D.: Prepared statement...........................    22

                                APPENDIX

Hearing notice...................................................    52
Hearing minutes..................................................    53
The Honorable Elton Gallegly, a Representative in Congress from 
  the State of California: Prepared statement....................    55
The Honorable Gerald E. Connolly, a Representative in Congress 
  from the Commonwealth of Virginia: Prepared statement..........    57
Written responses from the Honorable Kurt Campbell to questions 
  submitted for the record by the Honorable Eni F.H. 
  Faleomavaega, a Representative in Congress from American Samoa.    59

 
                      WHY TAIWAN MATTERS, PART II

                              ----------                              


                        TUESDAY, OCTOBER 4, 2011

                  House of Representatives,
                              Committee on Foreign Affairs,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10 o'clock a.m., 
in room 2172 Rayburn House Office Building, Hon. Ileana Ros-
Lehtinen (chairman of the committee) presiding.
    Chairman Ros-Lehtinen. The committee will come to order. 
After recognizing myself and the ranking member, my good 
friend, Mr. Berman, for 7 minutes each for our opening 
statements, I will recognize the chairman and the ranking 
member of our Subcommittee on Asia and the Pacific for 3 
minutes each for their statements. We will then hear from our 
witnesses and I would ask that you please summarize your 
prepared statements at 5 minutes each before we move to the 
question and answer period within the 5-minute rule.
    So without objection, the witnesses' prepared statements 
will be made a part of the record and members may have 5 days 
to insert statements and questions for the record, subject to 
the length limitations in the rules. The Chair now recognizes 
herself for 7 minutes.
    Today we continue our examination that we began in June of 
``Why Taiwan Matters,'' and why, despite the importance of the 
U.S.-Taiwan relationship, Taiwan has been so neglected in 
recent years.
    To counteract this growing inattention to Taiwan in certain 
Washington circles, including inside this administration, and 
to clarify congressional intent, I introduced last month, H.R. 
2918, the ``Taiwan Policy Act of 2011.'' This legislation seeks 
to further clarify and strengthen the Taiwan Relations Act, 
which has long served as the cornerstone for American policy in 
addressing cross-Strait issues. But there are increasing 
challenges ahead of us.
    On December 29, 1940, President Franklin Roosevelt 
addressed the American people in one of his famous fireside 
chats. At that time, a small island democracy was being 
threatened by the overwhelming force of a menacing continental 
power. Roosevelt told the American people that ``We must be the 
great arsenal of democracy'' to provide the means for the small 
island country of Great Britain to preserve mutually-cherished 
democratic values.
    Yet, the Obama administration has beaten a steady retreat 
not only from its obligations mandated in the Taiwan Relations 
Act, but from the spirit of FDR's words, by not providing 
sufficient means for Taiwan's defense.
    The decision not to sell Taiwan the next generation of F-16 
fighters is a decision with potentially grave repercussions. 
Why must we appear so timid before Beijing? And what message 
does such timidity in the face of Beijing's growing 
belligerence send to our treaty allies in the Asia-Pacific 
region, specifically Japan, South Korea, the Philippines and 
Australia?
    Nor does allowing Taiwan to slip further and further behind 
in the cross-Strait arms race meet our own national security 
requirements. And any cozying up to Beijing with a wink and a 
nod on Taiwan arms sales is a clear violation of President 
Reagan's Six Assurances. Is it customary to give the clearly 
potential adversary the game plan for the defense of a friend 
and strategic partner? Isn't that like telling the fox the 
location of each chicken in the henhouse?
    Taiwan needs our help. China is on the march in Asia, and 
its primary target remains democratic Taiwan. In August, 
Beijing began sea trials of its first aircraft carrier, 
reportedly to be named after a Chinese admiral who led a 
successful invasion of Taiwan over 300 hundred years ago.
    The carrier will be used to further assert Beijing's 
maritime claims, and will patrol the Taiwan Strait.
    Beijing has bullied our Philippine allies in the South 
China Sea, threatened our Japanese ally in the East China Sea, 
and intimidated our South Korean ally in the Yellow Sea. In 
June, for the first time since 1999, Beijing also sent up 
aircraft that crossed into Taiwan airspace above the Taiwan 
Strait. Taiwan responded by sending two of its outdated F-16 
fighters to intercept the Chinese aircraft which, fortunately, 
turned back.
    But why must Taiwan depend on rickety old aircraft, 
provided almost 20 years ago by the George Herbert Walker Bush 
administration, to face state-of-the-art Chinese fighters? 
Taiwan has repeatedly asked this administration to provide it 
with the next generation of F-16 C/Ds. If the skies over the 
Taiwan Strait become contested, how is Taiwan to defend itself 
against Chinese state of the art fighter jets?
    The 2011 Department of Defense's Annual Report to Congress 
on ``Military and Security Developments Involving the People's 
Republic of China'' noted that ``The balance of cross-Strait 
military forces and capabilities continues to shift in the 
mainland's favor.''
    Randall Schriver, who appeared as a witness at the 
committee's last Taiwan hearing in June, wrote this summer in 
the Washington Times that ``Out of our deference to China, and 
despite the rapid PLA buildup, the Obama administration to date 
has the worst record on Taiwan arms sales since the passage of 
the Taiwan Relations Act in 1979.'' A 2009 RAND study goes so 
far as to claim that the Chinese military ``likely has, or will 
soon have, a credible ability to challenge the United States 
and Taiwan for air supremacy, perhaps opening a window for an 
invasion attempt.''
    Likewise, the administration's most recent China Military 
Power Report clearly shows the threats that Taiwan faces from 
an increasingly muscular and aggressive China. It is obvious, 
therefore, that Taiwan needs the next generation of F-16 
fighters to protect her skies and she needs them now. And 
Taiwan equally needs diesel submarines to protect her 
territorial waters and she needs them now.
    The upgrade of older model F-16s is a modest step in the 
right direction, but insufficient to meet Taiwan's increasingly 
urgent requirements for an effective air defense, including 
late model combat aircraft. This raises questions about the 
administration's commitment to ensure that Taiwan has the means 
to defend herself against mainland China, as mandated in the 
Taiwan Relations Act.
    And more broadly, Taiwan needs an active American policy to 
promote deeper ties between our two nations. Such a 
reinvigorated policy should include high-level official visits, 
a free trade agreement and, as soon as all homeland security 
criteria are met, Taiwan's early admission to the
    Visa Waiver Program once security requirements are 
finalized.
    These proposals are included in the legislation that I 
introduced and that I mentioned at the beginning of my remarks. 
And now I turn to my friend, the ranking member Mr. Berman for 
his opening remarks.
    Mr. Berman. Thank you, my friend, Madam Chairman. At the 
first hearing we had in June, I made an extensive opening 
statement on the critical importance of the U.S.-Taiwan 
relationship. Today, as we open part two of the hearing, I want 
to reiterate my strong support for Taiwan and for bolstering 
all aspects of our bilateral ties.
    With an upcoming Presidential election in Taiwan next year, 
the people of Taiwan will once again exercise their democratic 
right to directly choose a President. I strongly support 
Taiwan's vibrant democracy. I want to assure the Taiwanese 
people that the United States will respect the choice they make 
in January and will continue to support them, no matter who is 
elected.
    Despite a marked improvement in the economic and social 
ties between Taipei and Beijing, China still has not renounced 
the use of military force against Taiwan. On the contrary, 
Beijing has increased the number of missiles targeted at 
Taiwan. During the earlier hearing on Taiwan, members on both 
sides of the aisle expressed a strong commitment to maintaining 
Taiwan security in the face of the growing Chinese military 
threat.
    To address this threat, the United States should continue 
to supply Taiwan with weapons so that it can defend itself. I 
welcome the Obama administration's recent decision to upgrade 
Taiwan's existing fleet of F-16 fighter jets and would note 
that this administration has sold more defense systems to 
Taiwan in a shorter time span than the previous administration.
    However, I view the upgrades only as a first step. Taiwan's 
air force needs more advanced F-16s to adequately defend itself 
from China and it needs them soon. Projections of Taiwan's air 
force stocks indicate a significant decline from its current 
fleet of 377 fighter jets which includes F-16 A/Bs, Vietnam era 
F-5s, Taiwanese indigenous fighters and Mirage 2000s. A 
decrease from that number, 377 to fewer than 275 fighters by 
2020.
    Not only will Taiwan have fewer planes, but also less 
capability while the Chinese air force and missile squadrons 
deploy across the Taiwan Straits are growing at an exponential 
rate. As a result of the administration's decision, Taiwan will 
ultimately have 145 F-16s that have been retrofitted to be 
equivalent to F-16 C/Ds through the sale of the upgrade kits. 
But if the administration had provided both the upgrade kits 
and the advanced fighters requested by Taipei, then Taiwan 
would have 211 F-16 C/D aircraft delivered in the same time 
period as the upgrade kits alone.
    I look forward to the testimony of our witnesses today to 
hear their views of how Congress and the administration can 
work together to support Taiwan's democracy and security. And 
with that I yield back, Madam Chair.
    Chairman Ros-Lehtinen. Thank you very much, Mr. Berman. I 
now would like to recognize members for 1-minute opening 
statements beginning with Mr. Smith of New Jersey, the chairman 
of the Subcommittee on Africa, Global Health, and Human Rights.
    Mr. Smith. Thank you very much, Madam Chair. Thank you for 
calling this very timely and important hearing. A welcome to 
Assistant Secretary Campbell and Deputy Assistant Secretary 
Schiffer.
    Taiwan is a special place, as we all know, with very 
special people. Through adversity, struggle, and courage, the 
Taiwanese people have created a vibrant, free, and democratic 
society that is a beacon of hope and light in that part of the 
world. This strategic ally and economic powerhouse also serves 
as an example of a society where human rights are highly 
valued, promoted, and upheld. In Taiwan, the values of freedom 
of religion, freedom of expression, worker rights, and the rule 
of law are not just given lip service, but are core principles 
taught to each new generation.
    But maintaining freedom comes with a price. Vigilance, 
preparedness, and a commitment to a strong national defense 
cannot be taken for granted, but must be pursued and 
maintained.
    As the United States fought the battle of ideas and values 
with the former Soviet Union, Taiwan by its very existence 
fights the battle of ideas and values with those nations that 
seek to limit and repress their citizens, especially the PRC 
through institutional injustice, lack of freedom in residence 
and movement, and the horrific corrosion tactics which destroy 
families and communities. With that, I yield back.
    Chairman Ros-Lehtinen. Thank you, Mr. Smith. Thank you. 
Another gentleman from New Jersey, Mr. Sires is recognized.
    Mr. Sires. Madam Chairperson, I'll be very brief. I'm just 
happy to be here to listen to what you have to say and I am a 
supporter of the sale of the fighters to Taiwan and I'm very 
happy to see that they moved forward on democracy where they 
actually had a transfer of power. So I'm just supportive and 
thank you very much.
    Chairman Ros-Lehtinen. Thank you, Mr. Sires. Mr. Burton is 
recognized. He is the chairman on the Subcommittee on Europe 
and Eurasia.
    Mr. Burton. Thank you, Madam Chairwoman. Taiwan has been a 
great ally of ours for as far back as I can remember and I've 
always thought it was unseemly that we wouldn't allow their 
chief executive to visit the United States or even get off the 
plane. I just think it's terrible. And while China has 1600 
missiles pointed at Taiwan, we continue to just piddle around 
and not give Taiwan the support that they need to defend 
itself. They have asked us personally, me personally, and 
others, for the upgraded F-16s and the kits that will keep them 
in a positive situation. They've also asked for a diesel-
powered submarine so that they can defend themselves.
    And it just seems to me totally unacceptable that this 
administration and the Congress of the United States and the 
Government of the United States does not support Taiwan and 
sell them the needed equipment necessary to defend themselves. 
They're not going to attack China. They want to be able to 
defend themselves.
    Chairman Ros-Lehtinen. Thank you very much, Mr. Burton. Mr. 
Royce is recognized. He's the chairman of the Subcommittee on 
Terrorism, Nonproliferation, and Trade.
    Mr. Royce. Thank you, Madam Chair. In two generations, 
Taiwan has moved from poverty to prosperity, from autocracy to 
democracy. And unlike China, Taiwan is truly a responsible 
stakeholder in Asia. However, Taiwan faces several challenges. 
China's rapid military buildup, its continued aggressiveness in 
the South China Sea are big concerns and yes, I'm afraid we're 
falling short, giving China too much sway in our relations with 
Taipei. We should be moving on the advanced F-16 fighters, not 
just the upgrade kits.
    Let me also say that we should move forward with our Trade 
and Investment Framework Agreement with Taiwan. And we should 
use this dialogue to increase the prospects of securing a U.S.-
Taiwan free trade agreement in the future. Our trade relations 
with Taiwan have deteriorated over the last several years as 
American businesses continue to lose market share. The best way 
to bolster trade ties would be to initiate negotiations for a 
free trade agreement. Thank you, Madam Chair.
    Chairman Ros-Lehtinen. Thank you, Mr. Royce. Mr. Connolly 
of Virginia is recognized for 1-minute opening statement.
    Mr. Connolly. Thank you very much, Madam Chair. And thank 
you for having part two of this very important set of hearings. 
The U.S.-Taiwan relationship is a very important one. It's our 
ninth largest trading partner. We've invested a lot in the 
security of the Taiwan Strait. The ultimate outcome in the 
Taiwan Strait must be settled between the Chinese, but it must 
be settled peacefully. We have a statutory obligation under the 
Taiwan Relations Act to protect and to provide for the defense 
capability of Taiwan.
    I certainly look forward to hearing why the administration 
decided to upgrade the F-16s that exist now in Taiwan rather 
than providing the order of new F-16 weapons requested and that 
I consider to be a reasonable request by the Government of 
Taiwan.
    I thank the chair and look forward to talking to our 
witnesses.
    Chairman Ros-Lehtinen. Thank you, sir. Mr. Chabot is 
recognized. He's the--okay. Ms. Schmidt is recognized from 
Ohio.
    Ms. Schmidt. Thank you, Madam Chairman, for holding this 
very important hearing. I just want to say a few things. The 
best defense is a good offense. For the Taiwanese, that means 
the F-16s, and we need to sell them to them and sell them to 
them immediately. China is rapidly building up its military, in 
addition to an almost 13 percent increase in their defense 
budget last year. They purchased their first aircraft carrier 
from Ukraine under the guise that it was going to be used as a 
floating casino. Taiwan needs to be able to protect itself and 
we have the ability to help them do that.
    We also need to work on trade issues, including free trade 
agreements, the Visa Waiver Program, and finally, we need to 
honor the Taiwan Relations Act. I yield back my time.
    Chairman Ros-Lehtinen. Thank you so much. Another member 
from Ohio, Mr. Johnson is recognized.
    Mr. Johnson. Thank you, Madam Chairman and I appreciate our 
important panel being here today to discuss the relevance of 
Taiwan to our national security and foreign affairs objectives. 
Over the past few months concerns abound surrounding China's 
military buildup and its implication for the Asia Pacific 
region. China has significantly surpassed Taiwan in military 
capability and as the sale of new F-16s fails to move forward 
in replacing Taiwan's F-5 fleet that disparity continues to 
mount.
    Even with the sale of the new F-16s, Taiwan would still be 
far behind Chinese military capability.
    In dealing with Taiwan, we must work to emphasize the 
shared values that induced us to become a defender and advocate 
for Taiwan in the first place: Human rights, democracy, strong 
market economies, and freedom. I'm glad that that's what this 
committee promotes and this Congress promotes and I look 
forward to hearing from the panel today.
    Chairman Ros-Lehtinen. Thank you so much. Mr. Marino is 
recognized for 1 minute. Thank you, sir. Mr. Gallegly is 
recognized for 1 minute for his opening statement.
    Mr. Gallegly. Thank you, Madam Chairwoman. I think it's 
clear that my position on Taiwan is well documented and the 
support that I think we have from the entire Congress is one 
that we can be proud of. The sale of the F-16s is critical and 
vital to the national security.
    I have so many things that I'd like to say and time won't 
allow me to do this, so I just ask unanimous consent that I may 
place a statement into the record.
    Chairman Ros-Lehtinen. Without objection.
    Mr. Gallegly. Thank you.
    Chairman Ros-Lehtinen. Thank you so much. Ms. Bass is 
recognized for 1 minute opening statement and Mr. Cicilline 
passes as well. So now Mr. Manzullo, he'll have 3 minutes. He 
is the subcommittee chairman on Asia and the Pacific.
    Mr. Manzullo. Madam Chairman, thank you for holding this 
important hearing on the relationship between Taiwan and the 
United States. We're here today because Taiwan matters. Indeed, 
it is one of the few beacons of freedom and democracy in a very 
dangerous neighborhood and our support for Taiwan must remain 
strong and steadfast. And I welcome Dr. Kurt Campbell, my 
fellow earthquake survivor in New Zealand in February this past 
year, when we were down there for the Trans-Pacific 
Partnership. It's pretty good for both of us to be here in 
light of what happened down there. We welcome you today.
    The administration's decision not to sell modern F-16s to 
Taiwan is in a sense truly disappointing. Instead, Taiwan was 
offered a glass that's half full, an option of updating its 
aging F-16 fleet which defense experts agree is not sufficient 
to defend against China's burgeoning arsenal. Denying Taiwan 
the critically needed weapons system only weakens that 
government's ability to defend itself and may even embolden 
China and indeed sends the wrong message to Mainland China as 
to our relationship with Taiwan.
    Thus, I'm glad the administration witnesses are here today 
to discuss the rationale behind the decision not to sell the 
upgraded fighters to Taiwan.
    Maintaining a close relationship between the U.S. and 
Taiwan is beneficial for the American people. Just last week, 
the delegation of 17 people from Taiwan visited the 16th 
Congressional District of Illinois which I have the honor of 
representing to announce Taiwan's intention of purchasing 
approximately $5 billion worth of corn and beans. This was a 
significant gesture and re-affirmation by Taiwan that the 
relationship between our two countries remains a high priority. 
The fact that Taiwan's is America's 9th largest trading partner 
and 13th largest export market for agricultural products should 
not be forgotten.
    Beyond defense cooperation and related matters, the U.S. 
must do more to grow the relationship with Taiwan. It is in 
America's interest to resume negotiations with Taiwan to 
include a Trade and Investment Framework Agreement in the near 
future. Furthermore, it is time to end the ridiculous policy of 
prohibiting high level Taiwanese Government officials from 
visiting Washington. It's astounding that the Foreign Minister 
of Burma is allowed to meet with senior State Department 
officials in Washington while high level visitors from Taiwan 
are turned away. This gives the awful impression that 
representatives of cruel and despotic regimes are given better 
treatment than representatives from the government committed to 
democracy and freedom. Surely, this is not what America is 
about.
    Madam Chairman, Taiwan matters and we must do more to 
support this relationship.
    Chairman Ros-Lehtinen. Thank you very much, Mr. Manzullo. 
And now we'd like to hear from the ranking member of that 
subcommittee, Mr. Faleomavaega. He's recognized for 3 minutes.
    Mr. Faleomavaega. Thank you, Madam Chair, and I want to 
personally welcome my good friend, Assistant Secretary Campbell 
to appear before this committee and to give us a little status 
report on the latest in terms of the administration's efforts 
in dealing with Taiwan.
    Madam Chair, Taiwan does matter. From a historical 
perspective, I believe Taiwan was one of the most crucial 
issues that took place when Kissinger was sent as a special 
envoy by President Nixon during the '70s, but even before that, 
Taiwan became a prize of war. When China was in the state of 
civil war, and we all know the history of what happened was 
that between Mao Zedong and Chiang Kai-shek. Chiang Kai-shek 
lost the war and he ended up in Taiwan. And with the fervent 
effort or hope that someday he will someday return to Mainland 
China to overcome Mao Zedong's Communist forces, etcetera, 
etcetera. Well, that never happened. That never happened. In 
fact, even the Korean War, it's my understanding that Mao 
Zedong was about to attack Taiwan.
    President Truman sent the 7th Fleet to give indication to 
China that we are not going to do something like this. Mao 
Zedong backed off and in fact, this incident also occurred when 
a very crucial question came into being before the United 
Nations, whether or not Chiang Kai-shek representing 23 million 
people was in a position to represent 1 billion people in 
Mainland China and it was such that President Carter made the 
decision that there had to be a change in terms of Taiwan no 
longer officially representing all of the Chinese people before 
the United Nations and as such this took place where the 
Peoples Republic of China then became the official 
representative, not only in the Security Council, but with the 
United Nations.
    Taiwan matters because we also came very close in terms of 
the situation that happened during President Clinton's 
administration where he had to send two battle groups to the 
Taiwan Straits again to show strong indication to China that 
because of our commitment and because of the Taiwan Relations 
Act in terms of our commitment in making sure that the people 
of Taiwan are protected from what enemy forces that may be that 
will cause harm to them. I believe the terms and the provisions 
of the Taiwan Relations Act is pivotal for us to better 
understand and appreciate how the United States policy toward 
Taiwan and the Taiwan Strait should continue.
    Taiwan matters because I think in terms of what we have, 
it's been a very consistent policy with all our Presidents, 
with President Obama, and that is basically that the people of 
Taiwan, the leaders of Taiwan are to negotiate and engage the 
peaceful dialogue with the Peoples Republic of China and 
whatever future that comes about in doing this that is to be 
done peacefully. I think we're very firm in that commitment. 
And then on the other hand, too, we are to make sure that 
Taiwan receives necessary military equipment that is needed to 
protect itself.
    Chairman Ros-Lehtinen. Thank you, Mr. Faleomavaega.
    Mr. Faleomavaega. Thank you, Madam Chair.
    Chairman Ros-Lehtinen. Thank you, sir. And now the Chair is 
pleased to welcome our witnesses. First I want to introduce 
Kurt Campbell, the Assistant Secretary of State for East Asian 
and Pacific Affairs. Mr. Campbell has had a distinguished 
career in Federal service including as Deputy Assistant 
Secretary of Defense for Asia and the Pacific during the 1996 
Taiwan missile crisis and as Director on National Security 
Council staff also during the Clinton administration. Before 
assuming his current position in June 2009, Dr. Campbell was 
the CEO and co-founder of the Center for a New American 
Security, CNAS. He also served as the director of the Aspen 
Strategy Group and was the senior vice president at the Center 
for Strategic and International Studies. He received his B.A. 
from the University of California, San Diego, and his doctorate 
in international relations from Oxford University. We are 
pleased to have you here, Dr. Campbell.
    And I'm also happy to welcome Mr. Peter Lavoy, the 
Principal Deputy Assistant Secretary of Defense for Asian and 
Pacific Security Affairs. Mr. Lavoy also serves concurrently as 
Acting Assisting Secretary of Defense. Previously, he served 
from 2007 to 2011 in the Office of the Director of National 
Intelligence (ODNI) where he was Director for Analysis from 
August 2010 through August 2011. Prior to joining ODNI, he 
directed the Center for Contemporary Conflict and taught in the 
National Security Affairs Department of the Naval Post-Graduate 
School in Monterey, California. Welcome to both you.
    I kindly remind our witnesses to keep your oral testimony 
to no more than 5 minutes and without objection your written 
statements will be inserted into the record.
    Dr. Campbell, we will begin with you.

 STATEMENT OF THE HONORABLE KURT CAMPBELL, ASSISTANT SECRETARY 
OF STATE FOR EAST ASIAN AND PACIFIC AFFAIRS, U.S. DEPARTMENT OF 
                             STATE

    Mr. Campbell. Thank you very much, Chairwoman. We both very 
much appreciate the opportunity to come up and discuss and 
testify before Congress on this critical issue and we share 
many of the concerns that have already been raised in terms of 
the importance of our relationship with Taiwan. Let me also 
thank my colleague and friend, Congressman Berman for his 
leadership on Asia; my friend, Congressman Faleomavaega for all 
his work in the Pacific; and Congressman Smith, for his 
extraordinary work on issues associated with separated families 
and left-behind parents in Japan.
    If you could also communicate to Mr. Manzullo, after the 
tragic earthquake in New Zealand, we worked with him and his 
staff. The United States is now the leading supporter of the 
rebuilding of the lovely town of Christchurch in New Zealand. 
We appreciate his leadership.
    I ask and thank the chairwoman, you have my testimony, my 
full testimony put on the record and I will just quickly go 
over a few points if I could.
    I want to just paint a general strategic picture of what I 
think our nation is involved in right now. A major pivot, a 
major rebalancing in terms of our foreign policy, national 
security priorities. We are in the process of responsibly 
moving from important consequential activities in the Middle 
East and South Asia to more focus on the Asia Pacific region. 
It is absolutely clear that we as a nation, the Executive 
Branch, the Congress, we need to step up our game in the Asian 
Pacific region across the board, trade, investment, security 
issues, institutions and political and strategic engagement 
across the board. Our allies, new friends and partners like 
India, Indonesia, building a strong partnership with China, all 
of the countries in the Asia Pacific region, look to the United 
States as the key player in terms of the provision of our 
security guarantees and the maintenance of peace and stability, 
not only across the Taiwan Strait, but across Asia as a whole. 
We are in the midst of this. This will take many years. It will 
be difficult. We have enduring, extraordinarily expensive 
difficult challenges in the Middle East, but Asia beckons.
    Much of the history of the 21st century will be written in 
Asia. The United States has to play a significant role in that. 
A critical part of that over-arching strategy is building a 
comprehensive, durable, and unofficial relationship between the 
United States and Taiwan. It's essential. The bedrock of that 
relationship is our security relationship and that is founded 
on several principles and key understandings.
    The Taiwan Relations Act stipulates, it's one of the most 
important acts of legislative leadership in foreign policy in 
our history. It stipulates that the United States must maintain 
the capabilities to resist coercion, to maintain peace and 
stability. We provide necessary defense articles to Taiwan and 
it also requires us to consult actively on Capitol Hill on all 
issues associated with Taiwan.
    Taiwan Relations Act, plus the so-called Six Assurances and 
Three Communiques, form the foundation of our overall approach, 
but our relationship is not simply a defense relationship. It 
is much broader. We seek to expand our economic and our trade 
relations. The trade relationship today between the United 
States and Taiwan is larger than the relationship between the 
United States and India. That's how significant it is. And we 
actually share the goals of moving forward on the TIFA 
Agreement.
    One of the most important things that we hear from 
congressional friends is how critical issues like beef are in 
terms of how they are treated. And I must say in our 
discussions with Taiwan friends, we have been disappointed with 
their lack of progress on this matter, but we are committed to 
make progress on this and building a deeper relationship with 
Taiwan economically and commercially going forward.
    Chairwoman, I also agree with you that on the people-to-
people level, it's important to take critical steps, that the 
Visa Waiver Program is extraordinarily significant. We've made 
much progress in recent months and we are aiming toward the 
very goal that you are aspiring to as well. So we see a broad 
range, unofficial relationship as deeply in the interests of 
the United States going forward.
    Some have suggested that there is an inconsistency with 
building a strong comprehensive partnership with China and 
maintaining a strong relationship with Taiwan. I think that's 
false. And I think if you look over the last several 
administrations, there have been an attempt to build a strong 
partnership with China and at the same time maintain a critical 
key relationship with Taiwan and I think that's exactly what we 
have done in the Obama administration and I think in terms of 
the consequences, the positive outcome of this you see also a 
strong improvement in relations across the Taiwan Strait 
between China and Taiwan in recent years. That's very much in 
U.S. interests.
    Now we have also stated very clearly that we, too, are 
concerned by military buildup across the Taiwan Strait. We have 
communicated that directly, not just to China, but all of our 
allies and friends in the regions who share these concerns. We 
think that these steps are antithetical to China's own interest 
in building a better relationship with Taiwan.
    Ultimately, it is in American interest to see democracy 
flourish in Taiwan. One of the things that bind us most closely 
is this democratic experience. In January, Taiwan will be 
conducting a major election both at the executive and the 
legislative levels. The United States supports that election. 
We don't play favorites. We don't choose candidates. We will 
work closely with any leader or leadership that emerges there. 
Thank you for this opportunity.
    [The prepared statement of Mr. Campbell follows:]
    
    
    
                              ----------                              

    Chairman Ros-Lehtinen. Thank you very much, Dr. Campbell.
    Dr. Lavoy.

  STATEMENT OF PETER LAVOY, PH.D., PRINCIPAL DEPUTY ASSISTANT 
SECRETARY OF DEFENSE, ASIAN AND PACIFIC SECURITY AFFAIRS, U.S. 
                     DEPARTMENT OF DEFENSE

    Mr. Lavoy. Madam Chairman, Ranking Member Berman, and 
members of the committee. I thank you for the opportunity to 
appear today to offer testimony on our policy toward Taiwan.
    Stability in the Taiwan Strait is critically important to 
the Obama administration and has a strong bearing on our 
enduring interest in and commitments to peace and stability in 
the Asia Pacific region. I commend the committee's continued 
interest in this matter.
    The Obama administration is firmly committed to our one 
China policy which is based on three joint U.S.-China 
communiques and the Taiwan Relations Act. This policy has 
endured for over three decades and across eight 
administrations.
    Today the United States has a deep security relationship 
with Taiwan as indicated by the administration's strong record 
on arms sales. Defense articles totaling over $12 billion have 
been approved for Taiwan in the last 2 years. We will continue 
to make available to Taiwan defense articles and services to 
enable it to maintain a sufficient self-defense capability. But 
our security relationship with Taiwan encompasses much more 
than arms transfers. The Department of Defense has the 
responsibility to monitor China's military developments and to 
deter aggression and conflict. Under the Taiwan Relations Act 
which has helped guarantee peace and stability in northeast 
Asia for over 30 years, we are charged with maintaining the 
capacity of the United States to resist any resort to force or 
other forms of coercion that would jeopardize security or the 
social or economic system of the people of Taiwan.
    China's economic rise has enabled it to transform its armed 
forces from a mass army designed for wars of attrition on its 
own territory to one capable of fighting short duration, high-
intensity conflict along its periphery against high-tech 
adversaries. Although we assess China's ability to sustain 
military power and the distance remains limited, its armed 
forces are developing and fielding advanced military 
technologies to support attacks in anti-access and aerial 
denial strategies.
    The majority of the PLA's advanced equipment is deployed to 
the military regions opposite Taiwan. Beijing fields advanced 
surface combatants and submarines to increase its anti-surface 
and anti-warfare capabilities. Similarly, advanced fighter 
aircraft and integrated air defense systems deployed to bases 
and garrisons in the coastal regions increase Beijing's ability 
to gain and maintain air superiority over the Taiwan Strait.
    These systems also enable Beijing to conduct offensive 
counter air and land attack missions against Taiwan forces and 
critical infrastructure. Beijing has deployed over 1,000 short-
range missiles and land attack cruise missiles to garrisons 
opposite the island to enable highly accurate conventional 
strikes. China also has an expanded capability for asymmetric 
warfare including special operations forces, space and counter 
space systems and computer network operations.
    In response to this growing threat, Taiwan authorities have 
undertaken a series of reports designed to improve the island's 
capacity to deter and defend against an attack by the mainland. 
These include important investments to harden infrastructure, 
build up war reserve stocks and improve the industrial base, 
joint operation capabilities, crisis response mechanisms and 
the officer and noncommissioned officer corps. These 
improvements on the whole have reinforced the natural 
advantages of island defense.
    Taiwan's defense reforms today are important and necessary 
and further efforts are needed. We are working closely with 
Taiwan on such steps related to both planning and procurement. 
A key conclusion of the report to Congress on Taiwan's air 
defense force is that Taiwan's approach to defense cannot match 
the mainland one for one. For example, Taiwan defense spending 
cannot match the mainland's, nor can it develop the same type 
of military the mainland is developing. Taiwan needs to focus 
its planning and procurement efforts on nontraditional, 
innovative, and asymmetric approaches. There's no single 
solution.
    Given this context, we believe the F-16 A/B upgrade made 
significant contributions to Taiwan's air power. The Taiwan 
Relations Act is a good law that makes for good policy, one 
that has created the conditions for the two sides to engage in 
peaceful dialogue. Our strong security commitment to Taiwan has 
provided them the confidence to intensify dialogue with the 
mainland and has resulted in improved cross-trade relations.
    A Taiwan that is strong, confident, and free from threats 
or intimidation is best postured to discuss and adhere to 
whatever future arrangements the two sides of the Taiwan Strait 
may peacefully agree upon.
    Madam Chairwoman, Ranking Member Berman, and members of the 
committee, I thank you for the opportunity to appear before you 
today and look forward to your questions.
    [The prepared statement of Mr. Lavoy follows:]
    
    
    
                              ----------                              

    Chairman Ros-Lehtinen. Excellent testimony. Thank you, 
gentlemen.
    I'm going to ask about the Taiwan arms sales. There have 
been disturbing press reports indicating that the 
administration may have given Beijing pre-notification of our 
intent regarding Taiwan arms sales prior to informing Members 
of Congress. A Defense News reported that ``the United States 
and China on July 29 held top-level talks on Taiwan with 
Washington working preemptively to avoid fallout as the 
decision nears on whether to sell fighter jets to Taiwan.'' 
Deputy Secretary of State Bill Burns held a closed-door session 
with his Chinese counterpart and during Vice President Biden's 
August trip to China, according to the Taipei Times, the 
Chinese Vice President reportedly raised a ``deeply sensitive'' 
issue of arms sales to Taiwan during their first meeting as 
well.
    My question is can you unequivocally confirm that no 
administration official including Vice President Biden and 
Deputy Secretary of State Burns pre-consulted with their 
Chinese counterparts on the administration's decision regarding 
the F-16s or any other Taiwan arms sales? And related to that, 
you had mentioned the Six Assurances of Ronald Reagan and I 
mentioned it in my opening remarks.
    Does this administration consider those assurances as an 
essential component of Taiwan policy, including Reagan's pledge 
to Taipei that the United States will not hold ``prior 
consultations with the Peoples Republic of China on arms sales 
to Taiwan.'' And lastly, can you explain to the committee why a 
U.S. decision not to sell Taiwan new F-16 fighter jets 
shouldn't be seen by many U.S. allies in Asia as a sign of 
China's growing clout and America's relative strategic decline 
in the region. Won't other nations interpret that decision as a 
retreat and reduction of support for a long-time friend and key 
nation in the chain of islands bordering China in the western 
Pacific?
    Dr. Campbell and Dr. Lavoy.
    Mr. Campbell. Thank you, Chairwoman. That's a lot of 
questions there, but let me try to take them one by one. I 
probably have been in hundreds of meetings between American 
officials and Chinese officials over a series of 
administrations, Republican and Democratic. I was in the 
meetings with Vice President Biden and I was with Bill Burns 
when he met with the Chinese counterparts. I have never, ever 
heard an American official ever talk to China and give advance 
notice about any arm sales. I categorically reassure you on 
that fact. And that is one of the most important aspects of our 
over-arching approach to Taiwan and also to China.
    As I stated in my opening testimony, yes, we do abide by 
the so-called Six Assurances and among the most important is an 
assurance that we do not pre-brief China about what we will do 
with respect to Taiwan. But as importantly, Chairwoman, we also 
talk to Congress before we talk to our Taiwan friends. So we 
think that this over-arching understanding is one of the most 
important underpinnings of how this implementation of the 
Taiwan Relations Act has----
    Chairman Ros-Lehtinen. Actually, the last one was shouldn't 
that decision about the fighter jets not be interpreted as a 
weakening of our resolve.
    Mr. Campbell. Let me just say generally speaking, the 
larger context. First of all, overall, American arms sales to 
the Asian Pacific region and to our allies and friends is up 
substantially, Chairwoman. In addition, we are moving U.S. 
forces from Afghanistan, Iraq, and elsewhere to reinforce our 
overall positions in the Asian Pacific region.
    And lastly, I would simply point out if you look at the 
decisions taken, and that's the issue, the decisions taken to 
provide defensive sales to Taiwan during the Obama 
administration, in 2010 and 2011, those 2 years, Chairwoman, 
they are greater than any other 2 comparable years in the 
history of the Taiwan Relations Act. So I would simply suggest 
to you and I work in the Asian Pacific region a lot, I think if 
you polled substantially, they would say that the United States 
over the last several years comprehensively has fundamentally 
stepped up our game in the Asian Pacific region.
    Chairman Ros-Lehtinen. Dr. Lavoy?
    Mr. Lavoy. Thank you very much, Madam Chairwoman. I 
certainly agree with Assistant Secretary Campbell. Under no 
circumstances do we consult with China or any other foreign 
power about potential arms transfers to Taiwan. It's a decision 
the administration makes, based on the Taiwan Relations Act and 
we do consult Taiwanese defense authorities. We have very 
rigorous and effective defense consultations with them to 
determine the appropriate prioritized needs for their defense 
and we judged that this was useful.
    Chairman Ros-Lehtinen. Thank you, sir. Mr. Berman, the 
ranking member is recognized for 5 minutes for questions.
    Mr. Berman. Thank you very much, Madam Chairman. I just 
would observe at the beginning that one perceives from a number 
of the countries in East Asia and in South Asia and Southeast 
Asia a desire for a closer relationship with the United States 
which undermines this notion that we are thought of in that 
area as a weaker and receding power. I think there's enough 
basis on the evidence in front of us that what has happened in 
the past couple of years and the significant closer, even 
military ties with these countries to indicate that they're 
investing a lot in America's continued presence in that region.
    I want to get to the F-16s. There's a factual dispute here. 
The administration on two occasions has asserted that the 
upgraded F-16s, the kits, providing the kits will get greater 
capabilities, more rapidly in a larger number of airplanes into 
the field in a more decisive way than were a decision made to 
provide the planes right now. The manufacturer of the F-16s 
says that 66 new F-16 C/Ds could be provided 2 years earlier 
than a like number of the upgraded A/Bs. Do you--would you like 
to arbitrate this discrepancy between yourself and the 
manufacturer regarding the time?
    Mr. Lavoy. Thank you very much. As I said earlier, the F-16 
A and B decision makes the most sense for Taiwan at this time. 
It's a decision that was based on consultations with Taiwan.
    Mr. Berman. My specific question is could they get the new 
F-16s, 66 new F-16s faster than they will get the modified A/Bs 
with the upgrade kits?
    Mr. Lavoy. It's our conviction, again, based on discussions 
with Taiwan authorities that upgrading their existing fleet of 
F-16s A and Bs is the immediate priority. And we will ensure 
that we work with the defense contractors to accelerate this 
upgrade so that they can maintain and upgrade capabilities for 
years and decades to come. And we will work with the defense 
contractors to ensure this happens.
    Mr. Berman. Well, you've asserted your position, but you 
haven't shed light on why the upgraded F-16s will be available 
more rapidly than the new F-16s. Is there something you could 
add that would provide us--I understand what you've said, but 
is this an issue you have no more to add to at this point?
    Mr. Lavoy. No, I don't, sir. We will work with the defense 
contractor to ensure that these are upgraded very quickly.
    Mr. Berman. You've made a decision, at least at this time 
not to do both. Is it the administration's feeling that 
Taiwan's funds available for defense acquisition, there are 
better things they could do for their own security interests 
than both buy the upgrade kits and the new planes?
    Mr. Lavoy. Thank you for that question, sir. We do look at 
Taiwan's defense needs from a holistic point of view. And of 
course, as I indicated, we have two major arms transfers that 
we've concluded in this administration and we're continuing to 
talk to them about a range of capabilities that they need to 
ensure their self defense for years to come. We judge that as 
an immediate priority, the F-16 A and B upgrade to take 145 
existing aircraft that were becoming outdated, and upgrading 
them to make them comparable to any fourth generation aircraft 
we sold to other countries is an immediate priority. And we 
have not ruled out any future aircraft decisions. We understand 
Taiwan's interest in F-16 Cs and Ds and this is under 
consideration.
    Mr. Berman. All right. I'll use my last 30 seconds, I won't 
get an answer, but on the underlining dispute I am still 
intrigued by the proposal--the Professor Ken Lieberthal, to 
what extent China and Taiwan could reach an interim 
understanding for that a set period of time 25 years, China 
commits to a force where any reliance on military means to 
settle this issue and Taiwan commits to resist any actions to 
seek independence during that period of time. And is that a 
reasonable approach to dealing with the underlying issue that 
has plagued us? And is that a role that the U.S. could 
facilitate? You don't have any time to answer that, but that's 
my fault.
    Chairman Ros-Lehtinen. Thank you, Mr. Berman. Mr. Smith is 
recognized for 5 minutes for questions.
    Mr. Smith. Thank you very much, Madam Chair. Again, I want 
to thank our two distinguished witnesses for their service to 
our country and for being here and for their testimony. It does 
shed light and it helps us make more informed decisions.
    You know, as we all know there is only one potential 
aggressor and that is not Taipei, it is Beijing. Taipei's 
desire to procure F-16 C/D fighters is based on what I believe 
Taiwan's growing alarm as to the PRC's systematic deployment of 
more missiles, combat aircraft, and an order of battle that 
increasingly by the week, by the month, certainly by the year 
looks more ominous and more menacing to people across the 
Taiwan Strait.
    My question is about deterrence. Obviously, Taiwan is not 
going to invade mainland China. It is all about defense. It's 
reminiscent of our strategy with regards to NATO, our war games 
with regards to NATO were always defensive. The Warsaw Pact and 
the Soviet Union always had offensive war games because we knew 
they would be the ones that would attack. Same is true, I 
believe, and I think we all agree with regards to Taiwan and 
the People's Republic of China.
    So my question is about deterrence. Whether or not the 
upgrades buy sufficient deterrence, whether or not the F-16 C/
Ds would truly provide the capabilities that Taiwan believes 
that it needs. I mean they have very savvy and very effective 
military planners who know what their capabilities are or lack.
    And another question would be did Beijing object more, is 
it objecting more to F-16 C/D sales, rather than upgrades? Of 
course, they're going to object to everything. That's part of 
their game plan, object to everything. But in their heart of 
hearts and certainly our perception of what they are objecting 
to, is it more about the F-16 C/Ds and did that play any role 
in our not providing those aircraft?
    Mr. Lavoy. Thank you very much for the question, Mr. 
Congressman. You've asked two or three very important questions 
actually. First on deterrence. Again, we work with Taiwan 
defense authorities to appreciate the threat. I've outlined 
what you've also described as a growing China military 
capability. As I've indicated in my oral and written testimony, 
much of this capability, in fact, the most advanced parts of 
the capability are located in and around Taiwan. So it is a 
threat that the Taiwan defense authorities take very seriously. 
We consult with them on this threat.
    We are committed under the Taiwan Relations Act which is a 
very good foundation for our policy to ensure that Taiwan can 
maintain a robust, self-defense capability in the face of any 
number of threatening scenarios.
    And we believe that a strong, secure Taiwan, based on 
survivable military capabilities provides the best deterrence.
    The second question you asked is about Beijing's objections 
to this particular arms transfer and relative to any other 
potential arms transfer. Well, I can't answer that 
hypothetically. We don't know how they would respond to a 
different arms transfer. And they have expressed, PRC has 
expressed its concerns about this. We understand them. But we 
think that this still makes the best sense for our relations 
with Taiwan and Taiwan's defense capability.
    Mr. Campbell. Let me add just one other point if I could, 
Congressman. The issue of the maintenance of peace and 
stability which is really enshrined at the outset of the Taiwan 
Relations Act, a critical component of that is not only the 
provision of necessary defense articles as my colleague and 
friend Dr. Lavoy has indicated, but it is also the maintenance 
of a robust American presence in the Asian Pacific region. And 
we intend as have a series of American Presidents and I believe 
we'll continue this into the future to maintain a robust 
capability that provides the basis of reassurance, not just 
across the Taiwan Strait, but to Asia as a whole.
    Mr. Smith. If I could, what do we perceive the game plan to 
be on Beijing's part? I remember Wei Jingsheng and his father, 
as you know, was very high up in the military, the father of 
the Democracy Wall movement. When he got out of China and he 
actually sat where you sat and testified at a subcommittee 
hearing on human rights, he is a tremendous human rights 
advocate. But he said we don't realize that they are building 
to the point where they hope not to even fire a shot, because 
their capability will be so superior to that of Taiwan, but if 
necessary, they would. And the intentions of Beijing are not 
benign. And I know we know that, but it seems to me that 
providing the best capability on the part of Taiwan, 
notwithstanding the objections of Beijing, to deterring war, is 
the best way we should proceed.
    Chairman Ros-Lehtinen. Thank you, Mr. Smith.
    Mr. Campbell. Do you want me to answer the question?
    Chairman Ros-Lehtinen. Maybe in a later format. Mr. Sires, 
the gentleman from New Jersey, another gentleman from New 
Jersey.
    Mr. Sires. Thank you, Madam Chairwoman. I just need you to 
help me understand this relationship a little bit because on 
one end it seems to be very confrontational. And as I read, I 
understand that there are more economic and more cultural ties 
now than has been in a long time between Taiwan and China. You 
know, can you just help me understand a little bit of that? I 
know there are a number of flights that have been increased and 
there's some sort of family reunification. Is that correct?
    Can you just--to me, that's--on one end, they've got 1600 
missiles aimed at Taiwan and on the other end, there seems to 
be a lot of economic growth between the two nations. So can you 
just speak to that a little bit?
    Mr. Campbell. Thank you. It's an excellent question, 
Congressman, and it actually feeds in nicely to the previous 
question that was just asked. In truth, we generally don't 
answer hypotheticals and it's hard to predict, put your mind
    --put yourself in the mind of any of your interlocutors, 
but it would be fair to say that what we've seen in recent 
years are developments that we welcome, very substantial 
people-to-people exchanges, economic interaction between Taiwan 
and China. I think there has been an improvement in dialogue 
and the economic relationship is stunning.
    But at the same time, it is true we are concerned by a 
buildup of military capabilities that is aimed at Taiwan and we 
have communicated directly to Chinese interlocutors that 
increasingly it seems that in their desire to build these ties, 
these positive ties that the military component is inconsistent 
and actually might undermine the very efforts to try to build 
trust and confidence that they are involved with in terms of--
between the people to people of Taiwan and China. We'd like to 
see more of those efforts continue and would like China to 
reconsider some of the steps that they have taken along the 
lines that Congressman Smith has laid out in terms of military 
buildups which frankly undermine the very peace and stability 
that all of Asia Pacific needs to thrive.
    Mr. Lavoy. If I could add to that to my colleague, 
Assistant Secretary Campbell. We firmly believe that a strong 
and confident Taiwan is a Taiwan that's comfortable and 
engaging with the mainland in improving the cross-trade 
relations. And we believe that our policy, the policy of the 
Obama administration, like the policy of seven previous 
administrations in enhancing Taiwan's self-defense capability 
has given it that confidence to improve cross-trade relations.
    Mr. Sires. Thank you, Madam Chair.
    Chairman Ros-Lehtinen. Thank you, Mr. Sires. You still have 
time.
    Mr. Sires. I was going to give the rest of my time to my 
colleague, Chris Smith, but he's----
    Chairman Ros-Lehtinen. Thank you. Thank you, Mr. Sires. Mr. 
Burton is recognized for 5 minutes.
    Mr. Burton. First of all, thank you for being here. We 
appreciate it. You've indicated, I think, that there are 1,000 
missiles pointed at Taiwan and the information we have up here 
is that there were 1,000 about 2 years ago, but now it's closer 
to 1600. So when we get to the answers I would like for you to 
respond to that.
    Taiwan, as my colleague has said, just purchased $5 billion 
in ag. products, so they're pretty good friend and trade 
partner. Right now in the U.S. Senate, the Senate is moving, 
trying to move legislation against China because they 
manipulate their currency to the detriment of the United States 
and other countries and so they don't have our best interest at 
heart all the time, just as a point of information.
    I think you've said that there's more military sales than 
at any time in history and when we get to the answer part here 
which you can respond to, I'd like to know what they're buying, 
what they're getting because they want F-16s, new aircraft, as 
well as the upgrades. And it was just pointed out to me they 
have 145 F-16s, 20 of which are in the United States. That 
means they have 125 there. They have air frames that are 20 
years old. The Mirages are really going to be gone pretty quick 
because they don't have the ability to upgrade those. The F-5s 
are going to have to be retired, and so they need 66 new 
aircraft.
    So I'd like to ask you, the aircraft that they have that 
have 20-year-old frames that you're going to upgrade in your 
opinion, I'd like to know if you think those are as good as new 
ones that are going in.
    Number two, don't you think that Taiwan deserves to have 
the ability as a very good friend and ally the ability to 
defend themselves in the event that there would be an attack 
and we hope that through negotiations that that will never 
occur. Nevertheless, they're our ally and our friend. China 
sometimes we think are our friends and sometimes as the Senate 
is talking about right now, they aren't. So don't you think 
that we ought to do everything in our power to make sure that 
Taiwan has all the technical and military equipment necessary 
to defend itself? And the new F-16s, which I've been led to 
believe would be of longer duration as far as their ability to 
be flown, would be the case. And the ones--you keep talking 
about upgrading, have a shorter lifespan and so at some point 
we're going to have to sell the new ones or let their whole 
military capability deteriorate anyhow.
    So those are just a few of the comments that I'd like to 
make in questions. So if you could respond to those, I'd really 
appreciate it.
    Mr. Lavoy. Thank you very much, Mr. Congressman. I think 
these are important questions and I'm happy to respond. First, 
you asked a question about the Chinese missile threat. It's my 
understanding that China has between 1,000 and 1,200 short-
range ballistic missiles, but there are cruise missiles as 
well, and I think maybe the number that you're giving is the 
combined missile capability. But it's a growing capability and 
we take it very seriously.
    Secondly, on the F-16s. Again, as I said, I want to 
emphasize that it's our understanding, our belief, that the F-
16 retrofit provides the best bang for the buck at this time. 
It's been the higher immediate priority.
    Mr. Burton. I just want to follow up to make sure you 
answer the question fully. Do you believe that the 66 F-16s, 
the new ones that they want, would be a better quality and 
longer duration than the upgrades that you're going to give 
them?
    Mr. Lavoy. Well, sir, I can state explicitly and we've 
taken a very close look at this issue, that the F-16 retrofit 
will provide Taiwan an advanced fighter whose detection 
capabilities, in other words, radar capabilities, and weapons 
engagement capabilities, its envelope, is comparable to any 
fourth-generation fighter available to the United States Air 
Force and available to our other--to our allies.
    Mr. Burton. I've been led to believe that they will not be 
as powerful as the new aircraft.
    Mr. Lavoy. Well, sir, a contractor will be upgrading the 
enhancing structure of the aircraft. And as we've indicated in 
our congressional notification that we provided 2 weeks ago, we 
do have an analysis for a new engine in that aircraft, so it 
will be fully comparable to the F-16 Cs and Ds.
    Mr. Burton. I'm running out of time. Let me real quickly 
say you said there was more military equipment sold to Taiwan 
than at any time in history. Now that covers a whole bunch of 
things. They want the F-16s. They want the ability to defend 
themselves. What have we been selling them?
    Mr. Campbell. Congressman, I think the Department of 
Defense can provide you a very full list. It's quite expansive 
and what I said specifically was that the decisions taken in 
2010 and 2011 are comparable or greater than any other 2-year 
period since the enactment of the Taiwan Relations Act.
    Chairman Ros-Lehtinen. Thank you.
    Mr. Campbell. I just want to underscore quite directly this 
has been a bipartisan commitment across administrations and 
we've had a consistent high-level commitment----
    Chairman Ros-Lehtinen. Thank you very much. Mr. Connolly is 
recognized.
    Mr. Connolly. Thank you, Madam Chairman. Dr. Campbell, Dr. 
Lavoy, briefly, what is your understanding of the U.S. 
commitment by statute in the Taiwan Relations Act with respect 
to the defense of Taiwan?
    Mr. Campbell. I think at the outset I could restate it if 
that would be helpful, but I went through and in my testimony I 
have gone through that carefully, Congressman. Would you like 
me to do that again here?
    Mr. Connolly. No, Dr. Campbell, I just want a concise--I 
mean we are committed by statute to the defense of Taiwan, are 
we not?
    Mr. Campbell. We are committed to the maintenance of peace 
and stability across the Taiwan Strait, yes, sir.
    Mr. Connolly. Does the act address the defense capability 
of Taiwan?
    Mr. Campbell. Yes, the act states clearly that the interest 
of the United States is the maintenance of peace and stability 
across the Taiwan Strait, that the United States maintain the 
capabilities to be able to respond to any coercion or 
disruption of that peace and stability and that we provide 
defensive, necessary defensive articles to Taiwan.
    Mr. Connolly. So it's not just peace and stability in the 
Straits, it is explicit in the statutory commitment to the 
defense capability of Taiwan?
    Mr. Campbell. Yes. I'm sorry. I thought I had stated that 
earlier, Congressman.
    Mr. Connolly. I was just trying to make sure we get that on 
the record.
    Mr. Campbell. Thank you.
    Mr. Connolly. Does the Taiwan Relations Act in any way, 
shape, or form allow for, encourage, or even address 
consultation with third parties in that statutory commitment?
    Mr. Campbell. Third parties, the fourth aspect that we 
think is extremely important in the Taiwan Relations Act is the 
insistence on consultation between the Executive Branch and the 
Legislative bodies----
    Mr. Connolly. I'm referring to sovereign nations.
    Mr. Campbell. No. In fact, there's nothing in the Taiwan 
Relations Act about that, but as the chairwoman has 
underscored, that soon thereafter there were a series of 
assurance, the so-called Six Assurances. And part of that was 
that the United States would not consult with other nations----
    Mr. Connolly. And is it your testimony, Dr. Campbell, I'm 
interrupting not to be rude, but I'm worried about my time.
    Mr. Campbell. Fine.
    Mr. Connolly. And the chair is very strict about it. Is it 
your testimony here today that therefore no formal or informal 
consultations or signals were sent to any sovereign third party 
with respect to the decision of the administration to upgrade 
the F-16s?
    Mr. Campbell. Absolutely not. There were no consultations 
of any kind in terms of specific weapons.
    Mr. Connolly. Did the State Department receive, 
nonetheless, representations from any third party sovereign 
nation with respect to the F-16, the pending F-16 decision?
    Mr. Campbell. I think as Dr. Lavoy has indicated, in a 
number of interactions with Chinese interlocutors, they 
regularly stress their unhappiness with American arms sales to 
Taiwan.
    Mr. Connolly. But that played no factor whatsoever in your 
decision?
    Mr. Campbell. It did not.
    Mr. Connolly. You just said to Mr. Rohrabacher, I mean to 
Mr. Burton, that essentially the upgrades you're looking at in 
the existing F-16s, even though they're aging, will actually 
make them comparable in capability to new F-16 C/Ds. That's 
what you just said?
    Mr. Campbell. I think that's what----
    Mr. Connolly. Dr. Lavoy.
    Mr. Lavoy. That is correct, sir.
    Mr. Connolly. If that's the case, why not just sell them F-
16 C/Ds? Why are we quibbling?
    Mr. Lavoy. Well, sir, again, we're working with Taiwan 
defense authorities to prioritize the upgrade, the retrofit of 
their existing 145 aircraft. Many more aircraft that might be 
contemplated in the C and D new replacement----
    Mr. Connolly. But Dr. Lavoy, why not just give them the 66 
we were talking about and then you can upgrade the rest? I was 
just in Taiwan. I didn't meet a single defense official, from 
the President on down, who said no, no, no. We're happy with an 
upgrade as opposed to our original request of C/Ds. I mean they 
may live with the upgrade, but their clear preference is for F-
16 Cs and Ds.
    Mr. Lavoy. Well, sir, these are two separate issues. They 
were very pleased with the upgrade of the As and Bs. It does 
make sense. We believe that it makes sense for the security and 
they believe so. And we are considering--we know their 
interests in the Cs and Ds and we are considering that request.
    Mr. Connolly. You are still considering the request for----
    Mr. Campbell. I think what he means, Congressman, is that 
we rule nothing out. We continuously evaluate the situation 
across the Taiwan Strait. We believe at the current stage that 
the decision on the upgrade was the appropriate step. It is 
part of a strong and consistent determination of the United 
States to maintain strong defensive capabilities of Taiwan.
    Mr. Connolly. And final point since my time is running out, 
Dr. Campbell, you said that the Taiwan Relations Act does 
require Executive and Legislative Branch consultation. This 
committee, I think, unanimously adopted the Connolly-Berman 
Amendment that called on the administration, in fact, to honor 
the request of Taiwan. Somehow that factored in your decision 
making?
    Mr. Campbell. Let me say that we believe that the 
consultative dimension of the Taiwan Relations Act between the 
Executive and Legislative----
    Chairman Ros-Lehtinen. Thank you. Mr. Royce----
    Mr. Connolly. We'll leave it a mystery, Madam Chairman.
    Chairman Ros-Lehtinen. Subcommittee on Terrorism, 
Nonproliferation, and Trade.
    Mr. Royce. Thank you. Let me ask Secretary Campbell a 
question here. I've long been an enthusiast for increasing 
trade and investment, increasing that relationship with Taiwan. 
Taiwan is based on the rule of law and you see the consequences 
of it unlocking a lot of entrepreneurial talent in terms of the 
Taiwanese people. And for far too long, I think, we've drawn 
this process out.
    Now, the Obama administration sent the KORUS Agreement to 
Congress for a vote yesterday. My question is, now that KORUS 
has been submitted to Congress, what can we do to move forward 
with our Trade and Investment Framework Agreement agenda with 
Taiwan? What can we do to advance that and how can we use this 
dialogue to increase the prospect of securing a U.S.-Taiwan 
free trade agreement?
    Mr. Campbell. Thank you very much and I very much 
appreciate the question. I will say that I am very grateful for 
the fact that we've been able to move ahead on the free trade 
agreements. It sends a powerful message to Asia that we are 
committed to an optimistic role in the burgeoning economies 
that is really the cockpit of the global trade and economic 
performance currently.
    I think that will help us subsequently, Congressman Royce, 
in terms of TPP and also our overall efforts in APEC.
    I would actually like to ask you to assist us in this 
matter. One of the things that you all have talked about is 
your conversation with Taiwan interlocutors. I would simple 
suggest the next time you meet with your Taiwan interlocutors 
as we do, underscore to them how important it is that they take 
the necessary steps on beef that will allow us to go forward. 
Remember that the primary considerations on beef-related issues 
and agriculture and ranch products are underscored for us in 
all of our communications with Capitol Hill. They provide the 
foundation for our engagement not just with Taiwan, but with a 
variety of other countries, South Korea, Japan, and others.
    We have, frankly, been disappointed with the lack of 
progress on these issues. We've had a series of consultations 
and we've made it very clear to Taiwan that we want to make 
progress on this, but we need to see them to take the necessary 
steps on beef moving forward.
    Mr. Royce. We can figure out beef, I think, but we've also 
got to have the political will to make it happen and part of 
your role is to initiate those negotiations. And I would just 
point out in the meantime, we had a witness at our last hearing 
who explained how U.S. businesses were losing market share in 
Taiwan, that that situation has deteriorated over the last few 
years in terms of the trade relationship. And he laid out an 
argument to us that the best way to bolster trade would be to 
initiate negotiations for a free trade agreement. That's 
probably the best way to get to a solution in terms of the beef 
issue and other issues that are of concern.
    But here's my concern. You have Asian countries that have 
cut all kinds of bilateral trade agreements, over 170 
agreements and the United States is only a party to two of 
them, Singapore and Australia. We have a tremendous 
opportunity, I think. Taiwan has been in kind of a tough 
situation with pressure from China, but Taiwan and Japan signed 
the first investment accord recently. I think that paves the 
way possibly for other free trade agreements that they're 
looking at.
    What else could we do to help push an agreement between 
Taiwan and the United States forward and make sure that the 
U.S. is not left out in terms of the trade agreements that are 
proliferating in Asia?
    Mr. Campbell. Thank you. I would say, Congressman Royce, I 
do believe that the effort that the United States has engaged 
in now, the so-called Trans-Pacific Partnership, has the 
potential to be the highest quality, most sophisticated trade 
deal of the 21st century. And we are in the process of moving 
toward a very consequential period in those interactions. And 
frankly, they've drawn attention and interest from a whole host 
of other countries in the Asian Pacific region.
    I think that step will help potentially encourage other 
countries like Taiwan, other places like Taiwan, to take the 
necessary steps to enable the United States to engage 
intensively.
    Mr. Royce. I agree, but that will take years. We need to 
push this agreement with Taiwan now in my opinion.
    Chairman Ros-Lehtinen. Thank you very much. Mr. Deutch.
    Mr. Deutch. Thank you, Madam Chair. I want to switch gears 
a little bit. Gentlemen, Taiwan's military schedule to shift 
from mandatory service to voluntary by the end of 2014, Dr. 
Lavoy, are you concerned about the effect that this might have 
on military cooperation and security issues?
    Mr. Lavoy. No, we think it's a good measure, like a number 
of defense reforms that Taiwan is undertaking to modernize its 
capability and make it more robust and confident in its self 
defense.
    Mr. Deutch. Thank you, and Secretary Campbell, your 
testimony--in your testimony, you discuss the importance of 
Taiwan joining the Visa Waiver Program. How would you assess 
Taiwan's progress with respect to meeting the eligibility of 
the Visa Waiver Program and what are the next steps that need 
to be taken?
    Mr. Campbell. Thank you on that. The Congresswoman referred 
to this at the outset. Frankly, they've made enormous progress. 
We've worked very hard on this. I've been very impressed by the 
activities they've taken in terms of passport refusals. There's 
a variety of technical steps that Taiwan has taken in terms of 
how you go about applying for passports and we've been very 
impressed with the determination that they have shown in this 
manner.
    There is a complex review process that has been established 
working in consultation with Capitol Hill since 9/11 in terms 
of countries needing to qualify on a whole range of issues. The 
next steps are a series of determinations that take place 
inside the U.S. Government, not just with the Department of 
State, but with other agencies, the Department of Homeland 
Security. But I will say very clearly that we have been very 
impressed by the progress taken and I think we shared the 
ultimate goals and ambitions that have been laid out in some of 
the statements we've heard thus far.
    Mr. Deutch. I understand that there are some technical 
steps. I understand that within our Government there needs to 
be some further evaluation. Can you tell us here whether there 
are specific significant steps that need to be taken that we 
would benefit from discussing here at this hearing?
    Mr. Campbell. To be quite honest, Congressman Deutch, we're 
actually quite close. We've made substantial progress. And we 
are now in a process of evaluation. It is not simply Taiwan. 
There are other countries that are involved in this. You have 
to look at a whole series of factors. But I think there has 
been a determination at the highest levels that this would be 
an extraordinarily important contribution to improving the 
people to people, the kind of business steps that Congressman 
Royce has indicated and the other kinds of exchanges between 
our two, between the United States and Taiwan in a way that 
will serve our interests.
    So I am--I am trying to be careful here, but we've made 
enormous progress and I think we'll try to make sure we work 
toward the finish line.
    Mr. Deutch. I'm sure that you will, Secretary Campbell. I, 
like a lot of my colleagues here, share your view that this 
would be a very important step for a whole host of reasons. Can 
you give us some sense of at least if you're not--if you choose 
not to talk about specific steps or specific items that need to 
be evaluated, can you at least give us a time line for 
completing that evaluation?
    Mr. Campbell. I think we can realistically expect to see 
progress in the very near term.
    Mr. Deutch. Okay.
    Mr. Campbell. Congressman Deutch, part of the reason I am 
being careful here is that this is not the exclusive purview of 
the Department of State. There are other key agencies that are 
involved. I would like not to be in a situation where I'm 
prejudging those outcomes, but I will simply say we have been 
charged at the highest level to make progress. We have made 
substantial progress. I do not believe we would have taken all 
of these steps if we were not determined to take this over the 
finish line and do it in the near term.
    Mr. Deutch. Madam Chair, I will accept moving us toward the 
finish line in the very near term and I will yield back.
    Chairman Ros-Lehtinen. Thank you very much to my colleague 
from Florida. Mr. Chabot is recognized, the chairman of the 
Middle East Subcommittee.
    Mr. Chabot. Thank you very much, Madam Chair, and I want to 
thank you for holding this important hearing and I know that 
you've been trying to pull this together for some time. We 
appreciate your efforts on that and as one of the founders of 
the Congressional Taiwanese Caucus I can say with certainty 
that you are much admired in Taiwan for your friendship and 
your tireless support of democracy in the region and around the 
world and we thank you for that. And we thank our distinguished 
panel here.
    Over the years, I've often brought up the issues of high-
level visits and how the restrictions on diplomatic visits by 
high-level Taiwanese officials to the United States are in my 
mind both counterproductive and in fact, insulting to the 
Taiwanese people.
    Some of us on this committee can remember flying up to New 
York City after votes one night to meet with then Taiwanese 
President Chen Shui-Bian, a very good friend to the United 
States. I would also note, I'd be remiss if I didn't say still 
incarcerated, and as a long time friend of Taiwan, let me just 
say that this to me smacks of Third Worldism and it amounts to 
the criminalization of politics. I wish it would be dealt with 
sooner rather than later.
    Anyway, because of travel restrictions, he could not come, 
the President could not come here to Washington to meet with 
us. I remember hosting a Taiwanese legislator here in my 
Washington office and only a few weeks later I had to travel to 
Baltimore to meet with him. Why? Well, he had since become 
Foreign Minister and he was barred from traveling to our 
capital. That's ridiculous. And as I said before, it's 
insulting to the Taiwanese people and that ought to be changed.
    And on the issue of high-level visits, I also want to raise 
the issue of high-level U.S. Government official visits to 
Taiwan. Since the United States began its one China policy, few 
U.S. cabinet officials have visited Taiwan. Secretary Clinton, 
during her confirmation hearings, and she said at that time 
that she would promote visits to Taiwan by U.S. cabinet 
secretaries. Well, that was almost 3 years ago and no such 
visits to our democratic ally have occurred. That needs to be 
dealt with.
    So I'm hoping our witnesses can respond to those concerns, 
especially in light of the fact that high-level visits between 
Washington and Beijing are commonplace. And when the latest 
Communist dictator from the PRC comes calling, the red carpet 
always goes out.
    I also want to add my hope that the Obama administration 
and this has been dealt with already, but I'm going to say it 
again, would reconsider its decision not to allow the sale of 
the F-16 C/D fighter jet to Taiwan. The Taiwan Relations Act, 
in my view, clearly states the commitment of the United States 
to ensuring that Taiwan is able to defend itself against its 
often-hostile neighbor, Communist China. An aging Taiwanese 
fighter fleet does not reflect that commitment, upgraded or 
not, in my view. This argument that our evaluation is on-going 
I don't buy it. As far as I'm concerned this administration 
just doesn't want to upset China. That's the real issue here 
I'm afraid.
    I can remember going to Taiwan for the first time in the 
mid-'90s. At that time, China had a number of missiles pointed 
at Taiwan. My recollection is it was about 600 at that time. 
Every year since then the number of offensive PRC missiles has 
increased. Now it's estimated that more than 1600 Chinese short 
and medium-range missiles are pointed at Taiwan, our democratic 
friend and ally.
    And before I yield to either of our witnesses, who would 
care to comment on these issues, I want to make clear that this 
is not a partisan matter with me. I've been very critical of 
our Taiwan policy under both Republican and Democratic 
administrations, so it's not politics. Bad policy is bad policy 
no matter who is in charge. And just one final point. This 
committee has consistently requested on-going substantive 
discussions with the administration regarding security issues 
impacting Taiwan. On all but one occasion those requests have 
been rebuffed. Indeed, the administration has violated 
reporting requirements relating to the Taiwan arms sales under 
the Taiwan Relations Act. How can you say that the 
administration takes seriously its obligation to consult 
Congress regarding the defense of Taiwan as mandated by the 
Taiwan Relations Act? And you've got 36 second to answer all 
those questions.
    Mr. Campbell. Thank you, Congressman. I'm not sure exactly 
where to begin. I would simply say that we have an unofficial 
relationship as you know, between the United States and Taiwan. 
Nevertheless, we have broad and deep consultations as we speak 
today. One of my deputies in the State Department responsible 
for APEC is in Taipei. Our deputy secretary of State met a few 
weeks ago in Auckland with his counterpart to discuss 
cooperation in the Asian Pacific region.
    In the larger context, my own sense is that Taiwan is a 
flourishing democracy, largely because of the support of the 
United States. It has a strong, enduring relationship with the 
United States that will continue and has been bipartisan.
    Chairman Ros-Lehtinen. Thank you, sir. Thank you. Ms. Bass 
is recognized.
    Ms. Bass. Thank you, Madam Chair. Deputy Assistant 
Secretary of State David Shear stated in March 2010 that the 
United States is a strong and consistent supporter of Taiwan's 
meaningful participation in the international organizations. He 
also noted that Taiwan has been a full member of the Asian 
Pacific Economic Cooperation forum. For the second time since 
initiating APEC's summits in Seattle in 1993, the United States 
will host an APEC summit in Honolulu in November.
    I wanted to know from the witnesses, if you feel that 
Taiwan's President should attend for the first time? And you 
also had said in your testimony that we do--that the Six 
Assurances is still a part of U.S. policy and I wanted to know 
if you could reiterate those Six Assurances.
    Mr. Campbell. Thank you very much, Congresswoman. I think I 
stated a few times already now on the importance of the Six 
Assurances and I will do so again. As I indicated, our APEC 
Ambassador is currently in Taipei to assist in preparations. 
Taiwan will be represented by a vice minister that is the 
practice at APEC and we think that that is the appropriate way 
to participate.
    We are in close consultation with Taiwan on a range of the 
issues that we are involved with in terms of the APEC agenda 
and we look forward to their active support and engagement on 
many of the issues that will be discussed in Hawaii when the 
President convenes the group in less than a month.
    You had one other question, I'm sorry?
    Ms. Bass. I knew you had said several times that the Six 
Assurances were a part of U.S. policy. As a new member, I was 
just asking if you could reiterate what the Six Assurances are.
    Mr. Campbell. They are primarily associated with no prior 
consultations about arms sales.
    Ms. Bass. Oh, I see.
    Mr. Campbell. And there are some other variants of those 
and I would be more than pleased to make sure that in a private 
consultation come up and provide you greater clarity on those 
issues.
    Mr. Campbell. Okay, thank you. And one other question. As 
Taiwan seeks greater international participation, what are U.S. 
concerns that Taiwan has questioned the safety of U.S. beef, 
even though Taiwan is a member of the World Organization for 
Animal Health?
    Mr. Campbell. Yes, and this gets back to the point that we 
were raising with Congressman Royce. We want these assessments 
to be signed space and evidentiary based, not on unfounded 
claims. We believe that the steps that Taiwan needs to take on 
beef have not yet been taken and that they are an impediment to 
the kind of broader economic engagement that I think the entire 
committee shares and believes is important going forward.
    Chairman Ros-Lehtinen. Thank you very much, Ms. Bass. Mr. 
Johnson of Ohio is recognized.
    Mr. Johnson. Thank you, Madam Chairman. Dr. Campbell, in 
May, a Chinese Communist official urged Taiwan's voters to 
choose the right person in the upcoming Presidential election. 
Then last month, according to an article in The Financial 
Times, a senior United States official, after meeting with the 
visiting opposition Presidential candidate from Taiwan, Ms. 
Tsai, said that she left us with the distinct doubts about 
whether she is both willing and able to continue the stability 
and cross-Strait relations the region has enjoyed in recent 
years.
    Since when does the United States Government choose sides 
in the internal elections of a democratic country?
    Mr. Campbell. Thanks. And thank you very much, Congressman. 
I stated very clearly in my testimony at the outset and 
restated in my oral presentation as well, that one of the most 
important things that ties the United States with Taiwan is the 
vibrancy and the engagement of our two democracies.
    Taiwan is coming up on an extraordinarily important 
election in January. The United States will not interfere in 
any way with that electoral process. We do not pick candidates. 
We do not take sides. And we will be committed to work closely 
and cooperatively with whoever is elected out of that free and 
fair election going forward.
    I would simply say also that the visitor that you referred 
to, Madam Tsai, when she came to Washington was greeted and 
engaged with very respectfully, both up here in Capitol Hill 
and with key officials in the United States Government as well.
    Mr. Johnson. Well, I don't know how we can say we're not 
picking sides when we make public statements like that.
    Mr. Campbell. I would simply say, Congressman, with 
respect, that was an unsourced, blind quote in a newspaper. 
Immediately thereafter, the United States Government issued a 
very clear statement which has been reiterated again and again 
and I will say so again here now. The United States does not 
take sides. We support the strong democracy in Taiwan. We will 
work closely with whatever candidate emerges from this election 
and we believe that it this is an essential feature of Taiwan, 
more than anything else, that keeps the United States and 
Taiwan close together.
    Mr. Johnson. I certainly hope we stick to that because it 
appears that, you know, we're leaning toward becoming so eager 
to please China that we're now taking our talking points from 
Beijing in regards to Taiwan's political future.
    Also, Mr. Campbell, China's threats following arms sales to 
Taiwan are not new. The U.S. faced a similar situation in 
January when China suspended military exchanges following the 
announcement of a $6.4 billion arms package to Taiwan. In 
addition, China froze military cooperation for the remainder of 
the Bush administration after the White House notified Congress 
in October 2008 of its plan to sell Taiwan $6.5 billion in 
defense equipment.
    In your view, does China actually have more to gain from 
these military exchanges than we do? And if so, how serious are 
their interests and how long would a cutoff in military ties 
exist?
    Mr. Campbell. I'll start with this and then I think my 
colleague, Dr. Lavoy, might have something to suggest as well.
    First of all, the military-to-military relationship, the 
communication between the United States and China is in the 
interest of both parties. It's in the interest of China and the 
United States. We don't do this as a favor to China and they 
don't do it as a favor or should not see it as a favor toward 
the United States.
    China is a growing military power, as they expand their 
forces, as they deploy more abroad in the oceans and air 
offshore China. They will come and they have come in contact 
more with American forces. We are concerned, frankly, about the 
potential for miscalculation and accident. We think 
establishing rules of the road, understandings, predictability 
about how we operate is one of the most important contributions 
to the maintenance of peace and stability.
    You remember back in 2001 at the beginning, at the outset 
of the Bush administration, the accident that took place 
between the Chinese fighter and the EP-3 American aircraft. 
Such actions have the potential to disrupt and roil relations 
in a way that is not in our interest and not in China's 
interest. So it is our strong determination to see these ties 
and communications go forward, but as a matter to try to 
improve understanding between our two sides.
    Mr. Johnson. I think I'm out of time, Madam Chairman.
    Chairman Ros-Lehtinen. Thank you very much. Mr. 
Faleomavaega is recognized.
    Mr. Faleomavaega. Thank you, Madam Chair. There is a 
perception that has been given to the extent that it seems that 
we are not giving enough military assistance to Taiwan. And I 
am glad just to hear that your statement, Dr. Campbell, that in 
actuality during this administration that there has been more 
assistance given in this regard with Taiwan's need for military 
equipment to defend itself.
    Can you provide that for the record and make that as a 
comparative analysis with other times of administration, 
because this is very, very important to me to know that in 
actuality this administration is very, very firm in its 
commitment to the defense of Taiwan.
    Mr. Campbell. I must say thank you, Congressman. I would 
simply that I do not believe that this is a partisan issue. In 
fact, I believe that, generally speaking, over a range of 
administrations you have seen close ties between the United 
States and Taiwan. In fact, the areas that we've had the 
greatest tension, frankly, were in the previous administration 
when there were some difficulties between the two sides.
    However, we have stood by our commitments----
    Mr. Faleomavaega. I appreciate that, Dr. Campbell, but 
please provide that for the record, just to make sure.
    Dr. Lavoy, I think it's been said that there are 1600 
missiles pointed toward Taiwan and I assume it's the latest 
state-of-the-art capability that the Peoples Republic of China, 
as far as militarily, with its capacity to shoot these 
missiles. How long will it take for these missiles to land in 
Taipei or any important cities in Taiwan, minutes, an hour?
    Mr. Lavoy. Certainly, less than an hour, certainly minutes, 
sir.
    Mr. Faleomavaega. Will that give Taiwan with its current 
capability militarily to respond in terms of defending itself 
with 1600 missiles coming from everywhere?
    Mr. Lavoy. Sir, we do look at Taiwan's defense needs in a 
holistic way. There are a number of threats. There's some 
missile threat, but I also talked about the air capability that 
China is developing. Its naval undersea capability.
    Mr. Faleomavaega. Here's my concern and I'm lacking time. 
I'm sorry, Dr. Lavoy. It seems that it's more symbolic in terms 
of our real commitment in helping defend Taiwan rather than 
saying does it have the capability of withstanding any military 
attack or aggression coming from the Peoples Republic of China. 
That's my concern. And I would appreciate a more clear 
definition in terms of what you think that we're capable of 
doing.
    Dr. Campbell, it's been known over years, despite all the 
rhetoric that Taiwan and Peoples Republic of China have always 
been confrontational, but in a public forum. And yet, they 
conduct over $100 billion unofficial trade. This is one of the 
ironies about dealing with Taiwan and its relationship with the 
Peoples Republic of China, unofficial trade of over $100 
billion. Can we add that to the actual amount of investments 
that Taiwan currently makes in the Procurement Center 
Representative, just like Japan, just like Hong Kong and other 
major companies? Do we have an approximate estimate of the 
total amount of investments that Taiwan has made in China?
    Mr. Campbell. Thank you, Congressman. I don't want to 
misstate here, so I want to make sure I get that into the 
record, but I think your general point is absolutely clear. The 
level of economic and commercial interaction is increasing 
dramatically between Taiwan and China. There are places that 
you can visit in China that are just filled with huge numbers 
of Taiwan businessmen. They have little communities where they 
have invested and they are engaged.
    I think that that's the complexity of this issue, that 
there are the enduring threats that this committee has focused 
on, but there is also a picture of growing economic engagement, 
commercial ties----
    Mr. Faleomavaega. I'm sorry, Dr. Campbell, I don't mean to 
interrupt because I know my time is up. The chairlady is very 
important to this.
    I make this observation. I've been to Taiwan several times, 
having the opportunity to have met with both President Chen and 
also President Ma and there is no question that the people and 
the voters of Taiwan are in this threshold in terms of making 
decision in their democracy in terms of what basic democracy--I 
mean what future they have in terms of dealing--and correct me 
if I'm wrong.
    President Chen advocated the idea, even going to the United 
Nations. They want Taiwan to be independent, which is a very 
major decision with the people in contrast voted in favor of 
President Ma who doesn't want to be under China, but 
economically, culturally, educationally which is exactly what's 
happening now and it seems that Beijing seems to be okay with 
it. And my time is up.
    Chairman Ros-Lehtinen. Thank you very much, Mr. 
Faleomavaega.
    Mr. Ted Poe, the vice chair on the Subcommittee on 
Oversight and Investigations is recognized.
    Mr. Poe. I thank the chair for the time and thank you, 
gentlemen, for being here and your expertise in this area.
    Here's the way I see the situation. The Chinese dragon is 
snorting the fire of intimidation against our ally, Taiwan. And 
to defend itself from the Chinese dragon's evil intentions, 
Taiwan defends itself with what I think are rusty swords, the 
old outdated F-16s. And it appears that by intimidation the 
U.S. has become somewhat timid under the Chinese dragon. The 
Beijing Government doesn't want us to sell them new F-16 C/Ds 
which happen to be built in Fort Worth, Texas, by the way.
    It is in our national interest to help Taiwan and it's not 
in our national interest to play Chamberlain and appease the 
Chinese dragon. That's the way it comes across to me. Chinese 
intentions of mischief are not limited to Taiwan. In the South 
China Sea, the Beijing dragon has initiated confrontation with 
the Philippine nation, the Japanese, Korea, and even Vietnam. 
China is expanding its claims of the South China Sea in areas 
that are international waters or actually belong to some other 
nation.
    So with this occurring and the expansion of the Chinese 
dragon, what message are we sending not only to Taiwan, but to 
Japan, other nations in the China Sea by failure to send the 
best aircraft we have, the F-16 C/Ds to them? So I would just 
like to hear from you that message that we're sending to all of 
the above.
    Mr. Campbell. Let me, if I can, Congressman, thank you very 
much for your question. In a larger context, U.S.-Japan 
relations have been extraordinarily important to this 
administration. The United States by orders of magnitude 
provided the most support to Japan after their tragic 
earthquake and nuclear crisis. Japan understands that our 
relationship is at the core of everything that we seek to do in 
the Asian Pacific region.
    If you look back to 2010, the important South China Sea 
initiative that Secretary Clinton took at the ASEAN Regional 
Forum. It made, no doubt, it made very clear that the United 
States had a strategic interest in the maintenance of peace and 
stability, the international use of sea lines of 
communications, I think a very important and well-regarded 
contribution to Asian Pacific security.
    We've taken steps to strengthen all of our alliances and as 
I suggested earlier, we're in the process of rebalancing 
substantial commitments in the Middle East and South Asia, more 
toward the Asia Pacific region. I would simply say as you look 
at Taiwan, what you see is first of all, a flourishing 
democracy that has achieved that status with the long-standing 
support of the United States, a very strong relationship with 
the United States, trade and economic engagement greater than 
that of India. We'd like to do more, I think has been 
underscored, but also at its bedrock an extraordinarily robust 
military relationship. And we've underscored clearly the steps 
that we have taken, not just in the provision of hardware, but 
broad-based engagement that we call software.
    Mr. Poe. Let me reclaim my time, Dr. Campbell. I only have 
a little bit of time. Let me center in on the expansion of the 
Chinese influence in the South China Sea with its 
confrontations recently with Vietnam and their oil exploration. 
Some of the folks that I've talked to when I was in the area 
said that China claims the whole area because it is named the 
South China Sea. Can you help us out a little bit about what 
you see the intentions of China in that area?
    Mr. Campbell. I'm cognizant of the gavel of the chairwoman. 
I'll never get this through this in 40 seconds. I will simply 
say that the United States has a strategic interest in all 
issues be handled peacefully. We believe that issues associated 
with sovereignty and boundaries should flow from the provisions 
laid out in the law of the sea. We support negotiations. We 
reject coercion and we have been in close consultation with all 
of our allies and friends in the region about the critical 
issue in the South China Sea. And I do agree with you that's 
it's an important issue that requires American leadership going 
forward.
    Mr. Poe. Thank you. I'll yield back the 2 seconds, Madam 
Chairman.
    Chairman Ros-Lehtinen. Thank you. Now Judge Poe was a very 
tough Judge in Texas and I'm a tough chairman. So we have that 
in common.
    Mr. Rivera, my Florida colleague, is recognized.
    Mr. Rivera. Thank you very much and we greatly appreciate 
that toughness. It's important. I share the concerns expressed 
earlier by many of my colleagues with respect to the signals or 
messages that are being sent by this latest decision not to 
support our greatest ally in the region, Taiwan, with respect 
to the F-16s. We have no greater ally than Taiwan, certainly in 
Asia, just as we have no greater ally in the Middle East than 
Israel. And we should always do everything possible to avert 
sending any type of mixed message or disturbing message that 
perhaps we are turning our backs on our allies in an effort to 
appease our enemies. I know some folks like to sugar coat the 
terms in describing China as a rival or competitor. But the 
fact is Communist China is an enemy of democracy. Communist 
China is an enemy of freedom. Communist China is an enemy of 
human rights and civil liberties. So we can spend a lot of time 
talking about how Taiwan is a flourishing democracy and I 
certainly agree and our great ally in that region, but we also 
need to say it like it is with respect to Communist China.
    So with that as a background as to my perspective, I have 
just one question for Secretary Campbell, one question for 
Secretary Lavoy and I'll start with Secretary Lavoy. Other than 
upgrading the old F-16s, what can this administration do to 
enhance Taiwan's air defense capability considering the threat 
that Communist China poses?
    Mr. Lavoy. Thank you very much for that question. Let me 
just make three very quick points in light of the diminishing 
time. First of all, this administration is committed to the 
defense of Taiwan and we have the strongest possible commitment 
to Taiwan. Taiwan does matter.
    Secondly, this arms package that was just announced to 
Congress 2 weeks ago does make sense. The core of Taiwan's air 
defense or air force is 145 F-16s. This extension, this 
retrofit----
    Mr. Rivera. Is there anything else we can do?
    Mr. Lavoy. We can do other things and we are doing other 
things. That was my third point. We are consulting with Taiwan 
on a full range of capabilities so that they're aware of the 
threat and they can undertake the defensive preparations. This 
might involve future arms transfers by this administration----
    Mr. Rivera. Future arms transfers such as?
    Mr. Lavoy. Well, I don't want to speculate on future ones. 
This is something that we're consulting with Taiwan authorities 
on and we are considering it actively.
    Mr. Rivera. For Secretary Campbell, in that same vein, what 
can this administration do to enhance Taiwan's diplomatic 
standing in the world, in encouraging and developing multi-
lateral efforts? What can we do to help our greatest friend in 
the region?
    Mr. Campbell. Thanks. It's a good question. I think it is 
the consistent policy of the United States to encourage Taiwan 
to play an appropriate role in a variety of international 
organizations. They've most recently been playing a role in the 
World Health Organization, given the potential for an outbreak 
of disease that could be devastating in Asia. We've seen 
certain flus in the past. Taiwan has some unique capabilities 
to bring to bear and I think that cooperation has been 
significant.
    The region has also been struck by a lot of very severe 
weather patterns and also earthquakes. Greater preparedness 
opportunities for Taiwan to participate in this regard I think 
is important. It is also the case that frankly simply the 
example of Taiwan, 25 years ago, Taiwan was a very brutal, 
authoritarian regime. It's now one of the most flourishing, 
exciting democracies in Asia. I think that example, also the 
example of a country, a place that's growing at nearly 8 
percent a year, tremendous vitality, lots of interchanges 
between Taiwan and China and with the United States and other 
countries in the region. It's actually flourishing and it's 
flourishing largely because of a strong relationship that we 
have sustained with Taiwan over decades and that we will 
continue to sustain going forward.
    Mr. Rivera. Thank you, Madam Chair.
    Chairman Ros-Lehtinen. Thank you. Thank you, Mr. Rivera, 
and another wonderful Florida colleague, Mr. Bilirakis, a/k/a 
Ray.
    Mr. Bilirakis. Thank you, Madam Chair, I appreciate that. 
One of these days, we'll explain that.
    There's a consensus among military analysts that the Taiwan 
Strait remains one of the most dangerous geo-political 
flashpoints in the world today. I'm therefore baffled at the 
President's appointee for the Director of American Institute in 
Taiwan who after all functions as a de facto U.S. Ambassador of 
Taipei need not pass through the Senate confirmation process as 
all other diplomatic appointees do. Why are the qualifications 
and perspectives of our Ambassadors to Grenada and Barbados 
subjected to more congressional scrutiny than our main 
representative to a key democratic ally with whom we share a 
broad, economic, and strategic interest? It is clearly in the 
U.S. interest, in my opinion, to have an AIT director confirmed 
by the Senate just like any other Ambassador.
    Wouldn't it be prudent to start the process of putting into 
law that the AIT director in Taipei be confirmed by the Senate, 
for the panel, please?
    Mr. Campbell. Frankly, it's not for me, Congressman, for me 
to comment on that. The practice is, as you know, we have an 
unofficial relationship with Taiwan. The representative is 
chosen very carefully. We have a long, distinguished record of 
people who have served in that capacity, often with extensive 
experience in Asia, deep language capabilities, and strong 
commitment to maintaining that relationship between the United 
States and Taiwan.
    Our current AIT chairman, Bill Stanton, one of the most 
effective American diplomats for decades, has done a great job 
building the relationship between the United States and Taiwan. 
There have been many who have preceded him and there will be 
many that follow him. The issues associated with Senate 
confirmations really resides in some other capacity, not mine.
    Mr. Bilirakis. Sir.
    Mr. Lavoy. I'm from the Department of Defense and I would 
certainly defer to the State Department on that issue.
    Mr. Bilirakis. Thank you very much. I yield back, Madam 
Chair.
    Chairman Ros-Lehtinen. Thank you very much. Thank you to 
all of our members, thank you to the audience, and most 
especially to an excellent set of panelists this morning. We 
appreciate your willingness to appear before us and the 
conclusion is that Taiwan matters a great deal, I know to you 
and most especially here to the Members of Congress and our 
committee. And with that, our committee is adjourned. Thank 
you, gentlemen.
    [Whereupon at 11:55 a.m., the committee was adjourned.]
                                     

                                     

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