Political lessons from Penghu

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For the past week I have been involved in various activities of the Anti-gambling Alliance (反賭博合法化聯盟) in their campaign against the plan for a casino on Penghu (澎湖). The residents of Penghu will vote in a referendum on 26 September that will decide whether plans for the casino will be approved. If the referendum passes and a casino is built it will be Taiwan’s first casino. At present the lottery is the only form of legalised gambling in Taiwan.

On Tuesday 19 September there was an international press conference in Taipei. Representatives of various NGOs including the Life Conservation Association, Green Party, Citizen Congress Watch and Taiwan Environmental Protection Union all spoke out against the plan for a casino and the referendum. They also mentioned that the referendum was illegal and unconstitutional as there was no minimum threshold for the referendum to pass. This is in contrast to national referendums where the threshold is set at a very high level.

Dr Tim Kelly who was the executive director of the US Congressional National Gambling Impact Study Commission (NGISC) was specially invited to Taiwan to share his experience. The NGISC report is the most comprehensive and authoritative report economic and social costs and benefits of legalized gambling anywhere in the world. A key point that Dr Kelly emphasised was the need for a comprehensive analysis of the costs and benefits of a casino on Taiwan before any casino is built in Taiwan. A summary of Dr Kelly’s key points on how the report applies to Taiwan can be found here.

The press conference received good media coverage. Check the report in the Taipei Times and Max Hirsch’s excellent article published on Gambling Compliance. Video news reports are available from FTV News and PeoPo.org.

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After the press conference I travelled to Penghu with Dr Kelly and Professor Yeh Chih-kuei. After landing at the Magong Airport we were met by Mr and Mrs Lin who are two of the most active campaigners against the casino on Penghu. They drove us to Houliao to visit one of the proposed sites for the casino.

The site is located at the end of a narrow road and the only nearby infrastructure is a small visitor’s centre and ferry port. Dr Kelly said he thought the site was unsuitable for an international casino as it was completely lacking in infrastructure and also a barren and unattractive area.

I only spent a short time on Penghu and only had time to get a brief overview of the islands. A major question that was raised in my mind was if Penghu has failed to develop as a major international tourist attraction up to now, then how would a casino suddenly facilitate this development. Why would people choose to come to Penghu instead of already established casinos in Macau or Korea? Furthermore Penghu’s environment is fragile and it  already suffers from water shortages. How could it cope with a significant increase in tourist arrivals? The supporting infrastructure required for a major resort casino would cause enormous harm to the environment.

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Around Magong and other places on Penghu the for and against campaigns had both put up banners to encourage people to vote in the referendum. The red banners are for the “disagree” vote, while the orange are for the “agree” vote. While the red banners include the name of the Penghu Anti-casino Alliance (澎湖縣反賭場聯盟), the red banners give no indication as to who was responsible for them.

The visit to Penghu was timed to coincide with the public hearing. This hearing was required as part of the referendum. Despite the name it wasn’t open to the public. Instead it was broadcast on television. Whether this is a good or bad thing is debatable. Professor Yeh, who was one of the speakers for the against side, said that in past public meetings he had been shouted down and a disproportionate amount of time was given to proponents of the casino. The public hearing this time allocated three speakers from each side ten minutes each to make their case. (If you search for “澎湖地方性公民投票案” on YouTube you can watch the speeches of all six people).

Some other issues of concern raised during the time on Penghu were the local media’s coverage of the casino issue. Both of Penghu’s newspapers have given a large amount of coverage to arguments in favor of the casino while arguments against have been ignored. The Anti-gambling Alliance had also been denied a permit to hold a rally on the eve of the referendum.

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On Thursday 17 September a group from the Anti-gambling Alliance visited the President of the Control Yuan Wang Chien-shien (王建煊). The picture above shows Ven. Chao Hwei (昭慧法師) presenting a letter to the Control Yuan President.

After Dr Kelly and members of the Anti-gambling Alliance expressed their opinion, Wang Chien-shien spoke. He began by saying that the Control Yuan lacked the power to respond to the requests. He then offered his personal opinion on the matter. He is strongly opposed to gambling and he made this very clear while a large contingent of media was present. He said that if Penghu develops a casino it will be a “disaster” and the people of Penghu will come to regret it.

The Taipei Times has an article on the Control Yuan President’s opposition to the casino. A video news report of the Control Yuan meeting is on YouTube.

There are many lessons to be learned about the nature of democracy in Taiwan from the ongoing campaign against the casino. At the 15 September press conference a Japanese reporter asked a very good question. He said if the referendum passes will the Anti-gambling Alliance accept the decision of the citizens of Penghu. Ho Tsung-hsun (何宗勳), director of Citizen’s Congress Watch, replied that in a democracy it is important that people have access to all the information to make their decision. The citizens of Penghu have only been informed of the benefits of a casino but not the costs.

Dr Kelly likened the campaign to the battle between David and Goliath. On one side stands the government and corporations with a huge amount of resources. While on the other side there is a small group of people with limited resources but a great deal of dedication and energy. The result of the referendum will be known next weekend. While the odds might be stacked against those campaigning against the casino they have still not given up, a chance of victory still remains.

15 thoughts on “Political lessons from Penghu

  1. Interesting post !

    I agree that Penghu will be the last place where people will go if they want to gamble…especially with Macau nearby.

    Ridiculous plan

  2. Before I comment, I’ll state on record that I’m personally against gambling in any form. However the institutions, in some cases, may have a positive effect (think RSL clubs in Aust).

    Now, a couple of questions.

    1. On the referendum minimum threshold – if no minimum has been formally stated, wouldn’t that mean the min. is 50% + 1? Or am I missing something?

    2. Is the aim of the casino to attract intl. visitors, or is it meant to draw a lot of the underground gambling that already goes on, and serve a mostly domestic need?

    3. What about cross-strait tourism? Is allowing direct flights from China part of the plan?

  3. cfimages, the problem with gambling is that the costs are often hidden. 15% of people that visit casinos are pathological gamblers. This problem creates massive burdens on society and the gambling industry doesn’t take any responsibility for it.

    Anyway to answer your very good questions.

    1. A national referendum in Taiwan requires a yes vote by 50% + 1 of the total eligible voters. The Penghu referendum merely require 50% + 1 of the total votes cast. i.e. if just three people on Penghu voted and two voted yes the referendum would pass. If the national standard were applied then assuming there are 50,000 voters on Penghu, 25,001 yes votes would be required to pass the referendum.

    2. The stated aim of the casino is to attract international visitors, although as I mentioned whether this will be successful is doubtful.

    3. China already restricts its citizens from visiting Macau to reduce gambling problems. The Chinese government would be unlikely to permit its citizens to travel to Penghu for the purposes of gambling.

  4. Thanks David. I’m well aware of the hidden cost of gambling – spent my uni years behind the bar in a pokie pub and saw a few people lose everything.

    1. Ok, got it. That does sound screwed up.

    2. Ok.

    3. Didn’t know that.

  5. David — the water issue might actually prompt the government to run a massive pipe out there from Taiwan.

    Great report. Don’t think you are going to win this one — Penghu is going to be wrecked. I’ll be heading out there soon to enjoy it whilst I still can.

  6. Another angle: This upcoming referendum casts an unfavourable light on the Executive Yuan Referendum Review Committee’s decision to turn down the DPP petition for a referendum on the basis that it doesn’t concern a major political issue. Yet, local referendums, and ones which don’t have a minimum threshold (as opposed to national requirements as you rightly pointed out) are ‘OK’. That’s as fishy as a Yunlin fishing market on a wet Saturday morning.

  7. Hi David,
    Nice write-up. I’m glad to see you involved in this issue. I too think casinos in Taiwan are a bad idea. This idea is only second on the all-time Taiwanese blunders list, right after electing the sellout-to-China KMT back to power in 2008. Here is my take on this issue: (most of it you already covered, I just feel like bitchin~!)

    1. Not only are casinos bad for Taiwan because of the social problems they will cause, but economic problems as well. The majority of the people of Taiwan WILL lose money. It is a fact. The house always win. Worse of all, the house is not even controlled by the Taiwanese, it will be foreigners (Brits) that run the damn place.

    2. And Penghu? What a mistake. If they are going to build casinos, they need bodies to fill the places. Kinmen would be much better choice because it is easier to get to. Then again, China can always a.) take control of the island or b.) cripple the business, like they do in Macau, by shutting down the transportation hubs to either island. In Macau they limit visas, but in Taiwan since the authorites have already given PRC citizens visa waivers, this is a non-issue.

    3. The water issue is another problem. Weather is also a factor especially for Penghu.

    4. Since the .gov is only allowing two casinos if the referendum passes, how may people do they think they can employ anyway? I find it amusing that in Taiwan there are already 3 or 4 dealer schools that guarantee jobs for graduates. UNLV runs one of them. These companies should be investigated for fraud.

    5. Add a link: on this page you can find satellite photos and beach photos of the planned Penghu casino: http://www.amazing.co.im/?pid=7

    6. I hate the way the Gambling industry tries upgrade their image by trying to use the word “Gaming” instead of Gambling. Who are they trying to fool?

    7. The money laundering issue will overwhelm authorities.

    8. Lastly, isn’t anyone in Taiwan paying attention to the global economy? The USA is on the verge of defaulting on their debt. Likewise, Eastern Europe, the UK and EU. This means not only is the 47% of Taiwan exports already lost never coming back, the remaining export trade may also be lost for quite some time. Taiwan should be hunkering down and thinking about long term survival strategies. People in Taiwan and China are not going to have disposable income to waste on gambling. Btw, if the USA defaults, that means the PRC is likely to implode shortly after which means BIG trouble for our little island.

  8. 9. The construction companies that think they will make $ are in for a surprise because they will probably not be able to pay back the debt they borrowed to build the place. The TWN .gov will be on the hook for the cost, just like the THSR.

  9. 11: Dr. Kelly makes a good point in his page that you linked to, that is:

    Most of the revenue captured in a casino comes from people who would have otherwise spent that money in their home community on entertainment, food, clothes, etc. Thus the taxes generated by a casino represent a shift away from local business and towards the gambling industry (not“new money”). Local businesses may fail, the casino may grow, yet the net tax increase will be small.

  10. Referenda where one side can massively out-spend the other, and one side is over-whelmingly portrayed as progress by the media…are just not a fair fight. I saw that a number of times in Scandinavia.

    We may see Penghu as beautiful, in part because it is relatively undeveloped…but the natives who’ve looked at it everyday their whole life may see it as under-developed, and there for unprosperous.

    But, considering how easy it appears to be to convince Taiwanese in general that the PRC is the star they need to hitch their wagon to, it would really be no suprise if the referendum passes.

    But even losing causes can be worthy causes, so I admire the enthusiasm of the people who do what they think is right to stop things like that.

  11. Looks like the good guys won this one for once, with 56% of Penghu residents rejecting the casino. If the people of Penghu can see past the transparent attempts by the government to load the dice in favor of the casinos, then I think there is yet hope for democracy in Taiwan. Thanks for your coverage of this issue.

  12. Many congratulations on the win David. Really good to see the good guys come out on top for a change.

  13. Here is more good news …. The Brit company that was in cahoots with the KMT (Amazing Holdings) has lost more than half it’s stock value overnight -> 138 on Friday, 47 today (LSE)

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