Pod Insights Search Engine The many lives of Taiwan About this episode We go deep into the story of Taiwan. How a tiny island escaped demise, chartered a course from colonial subjugation through mass Barbie production and into the technological powerhouse it is today.
The Tiger Leading the Dragon: How Taiwan Propelled China's Economic Rise https://www.amazon.com/Taiwans-Role-in-Prcs-Economic/dp/1442219580 by Shelley Rigger
Get tickets to hear PJ read live! Friends With Words at Roulette https://www.tickettailor.com/events/friendswithwords/2222446
Transcript Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
0:00 PJ Vogt? Hello. Before we start this week, a quick announcement. Next month, June 16th, in Brooklyn, I'm going to be part of a night of readings. It's part of this reading series called Friends with Words, hosted by writer and director Susanna Fogel. The theme of the night is writers reading risky work that they feel scared to read onstage. I will be there. Alongside This American Life's Ira Glass, Amelia Clark from Game of Thrones, fiction writer Kristin Rupe-Neen. It is a stacked lineup. There's even more people. I think it's going to be a special night. The venue is Roulette in Brooklyn, June 16th. Tickets are 25 bucks. There will be a link in our show notes. One night only. Okay, here's this week's episode after these ads.
1:07 PJ Vogt? Welcome to Surge Engine. I'm PJ Vogt. No question too big, no question too small. President Trump met last week in China with President Xi Jinping. They talked only a bit about one of the biggest points of contention between our two superpowers, the one I was listening for, Taiwan.
1:30 PJ Vogt? Taiwan is an independent democracy 100 miles southeast of China's coast. China wants to take Taiwan for itself, but the US for decades has stood in the way. Taiwan also happens to be where almost all of the high-quality graphics chips driving the AI race are made. If either country controlled Taiwan, the AI race would be fundamentally over. That is most of what I knew about Taiwan before this week's episode. I knew about it as an object in two other countries' designs. I didn't know much more about the place itself. How did Taiwan become a democracy? How did Taiwan end up manufacturing all those high-tech chips? How did an island this tiny become one of the most important places in the world?
2:15 PJ Vogt? So I did what I do these days when I'm curious. I asked Garrett Graham, our show's senior producer, to find me one of America's foremost experts on Taiwan, and also to select someone who's a really good storyteller. It took them all of two days. So now I'm going to recreate for you the journey we took from Search Engine Studios, a guided tour through modern Taiwan's history.
2:46 PJ Vogt? Do you mind just saying your name and what you do professionally?
2:50 Speaker 01 Sure. My name is Shelley Rigger. I am the Brown Professor of East Asian Politics at Davidson College in North Carolina. And right now, I'm also the Vice President for Academic Affairs and Dean of Faculty here at Davidson.
3:05 PJ Vogt? And how did you find yourself curious about Taiwan in the first place many years ago?
3:11 Speaker 01 When I was a college student in the early 80s, the US had just normalized relations with mainland China, with the People's Republic of China, and broken formal diplomatic relations and in fact ended recognition of this country that exists on Taiwan, which its formal title is the Republic of China. We always call it Taiwan, but it has another name. And so I took a class where we were going to figure out, you know, what's going to happen to Taiwan going forward. And so that's when I first became interested in Taiwan. In particular, I was interested in the indigenous Taiwanese people, who are about 2% of the
3:55 Speaker 01 population today and have been in Taiwan for millennia and did not originate on the Chinese mainland. You know, they sort of predate the idea of China. So I spent the summer of 1983 in Taiwan, learning about whatever happened to Taiwan's indigenous people, and then I was hooked.
4:21 PJ Vogt? Interesting. So, and help me understand, like, you come into Taiwan studies curious about the indigenous people of Taiwan. There's also overlaid on this, like, very tiny country, a vast history of colonization. Like, what other powers show up? What do they do? And how does it shape the place?
4:42 Speaker 01 So I love a good analogy.
4:43 PJ Vogt? Me too.
4:44 Speaker 01 So I'm gonna talk about this super famous object. I guess it's an artwork that is in the National Palace Museum, which is in Taiwan. It's a rock that looks like a hunk of pork.
5:00 PJ Vogt? Uh huh.
5:01 Speaker 01 But it's a special kind of pork that Chinese really love. It's called dongpo ro. And it is like layers of fat and meat. And then on the top is a sort of skin layer that looks delicious because it looks like it has all kinds of wonderful flavors soaked into it. But it's actually a rock. And everybody in Taiwan wants to see it. And lots of people in mainland China want to see it, too. When Chinese tourists come to Taiwan, they flock to the National Palace Museum and they want to see the meat rock.
5:31 PJ Vogt? Yeah.
5:32 Speaker 01 And Taiwan's human history is a little bit like the meat rock. Right? There are all these layers that accumulated on top of one another of human communities. And they've now all kind of melded together to form one thing.
5:53 Speaker 01 The first layer, of course, are the indigenous Taiwanese who have been there as long as anyone can imagine, remember. Taiwan's indigenous people are Austronesian, meaning of the same kind of back in, you know, deepest ancient history origins as other South Pacific islanders. And they may have been the sort of original South Pacific islanders. The linguistic and DNA research suggests that
6:27 Speaker 01 Many of the other South Pacific islands, people came there from Taiwan. Like in Moana with the boats, you know? The way they're going from one island to another, that really happened? But it seems as if the original island where all that started may have been Taiwan. Fascinating. So they speak a different language. Their cultures are very specific to Taiwan, the island where their cultures developed over thousands of years. And they were there already when Chinese started coming from the Chinese mainland, about a hundred miles away in the 1500s and especially in the 1600s and later.
7:07 Speaker 01 But the second layer, and in some ways the thickest layer, are people that came to Taiwan after the mid 1500s for the most part and before about 1900. And these are the folks that we often call native Taiwanese or local Taiwanese.
7:32 Speaker 01 The reason people came from mainland China to Taiwan was because it was very crowded in the mainland and there were opportunities for economic benefit in Taiwan. It was rugged, it was far away from any source of comfort or order. There was a lot of competition for land and resources. The indigenous people were already there, so you know, they're going to fight back to hold on to their stuff. Newer migrants coming from the mainland competed with older migrants from the mainland and different communities from the mainland competed with one another. None of those groups got along with each other. So it was a pretty violent place.
8:17 Speaker 01 It was not the kind of place where you go because you're thinking about staying and setting your clan for all eternity. But over decades, some people did stay and they started to bring families over from the mainland and Taiwan began to be a bit more of a kind of settled Chinese community.
8:39 PJ Vogt? It's funny, the way you describe it sounds a little bit like the American frontier West, like all these people going out to this rugged place to make a new life for themselves. There's already people there, the people who are settling don't totally get along with each other, but it sounds like Deadwood or something like that.
8:55 Speaker 01 Yeah, it is a lot like that, actually. You know, and I'm suddenly thinking about the gold rush, which was all men, you know, initially, almost all men. And then people said, well, actually, you know, I'm not panning for gold anymore. I'm doing something else, but this is pretty good. So let me get me a wife from back east and settle down here. So over those centuries from about mid 1600s, when Taiwan really starts to kind of gel as a place for Chinese settlement, the population of Taiwan, the Chinese origin population increased very rapidly and the place became a pretty important agricultural source, even for people
9:40 Speaker 01 back in the mainland. And as those kinds of things developed, the Chinese government started paying more attention, sending administrators over to Taiwan to try to kind of calm the chaos, take a little sheriff to Deadwood, turn it into more of a part of the empire. So by the 1800s, Taiwan was pretty much governed more or less, and some days more and some days less, by the Qing Empire. But in 1895, the Qing court ceded Taiwan to the Empire of Japan.
10:20 Speaker 01 So in 1894, China and Japan started fighting, and they were mostly fighting in the Korean Peninsula, fighting in Korea, over Korea. But then the Japanese started moving in on actual Qing territory. And the Qing, to settle that war, surrendered a lot of territory, including Korea. They accepted Japanese control over Korea, what we know as Korea today. And they also ceded Taiwan to the Empire of Japan.
10:52 PJ Vogt? And so they're saying to Japan, like, as a peace offering, we're giving you territory. It's not within the mainland, but it's very close. So it's like a big give. Once Japan colonizes Taiwan, what does Japanese colonization look like for Taiwan in Taiwan?
11:06 Speaker 01 One of the motivations for Japan to ask for territory was that the Japanese also saw the Western powers leaning in in Asia. You know, they had watched the colonization of Latin America, of Africa, of South Asia, of Southeast Asia. So they're coming for us next, right? That's the message. And starting in the 1860s, the Japanese government did this huge campaign of modernization and really emulating features of Western societies and especially Western militaries and economies that they believed had enabled the West to become so successful in colonization.
11:48 Speaker 01 And they were like, all right, we're going to show that you can't colonize us because we're going to be just as good at colonizing other people as you are.
11:57 PJ Vogt? Interesting.
11:57 Speaker 01 But in Taiwan, in particular, their concept was this is going to be a model colony and we're going to show how modern Japan is because we're going to build roads, we're going to build reservoirs, we're going to build railroads and industry and telegraph lines in Taiwan to show that Japan is a modern country and can do all of these modernizing things. So one of the features of colonization in Taiwan was it was actually quite developmental. The Taiwanese population at the end of the Japanese colonial period was more educated
12:40 Speaker 01 than pretty much any other population in Asia. So, you know, it was kind of a mixed bag. It was definitely colonization and there was a certain kind of assimilationist spirit there. So Taiwanese were educated in the Japanese language. And they were encouraged to take Japanese names. They were drafted into the Japanese army during the invasion of China, which started in the nineteen thirties. But at the same time, looking back on it, a lot of Taiwanese recognized that it was also a period of order and development for Taiwan.
13:17 PJ Vogt? So how does Japanese colonization end?
13:22 Speaker 01 Taiwan's Japanese era ended in nineteen forty-five with the surrender of the emperor.
13:40 Speaker 01 Right, the emperor surrendered and all of his subjects heard him on the radio surrendering, including his subjects in Taiwan. So for Taiwanese, this was a really weird moment because on the one hand, they had been Japanese subjects for fifty years, which if you think about it, you know, in the early twentieth century, that's much of a lifetime for most people.
14:02 PJ Vogt? Yeah.
14:02 Speaker 01 They'd been Japanese subjects, but they knew themselves to be ancestrally, culturally, linguistically Chinese. So for many people in Taiwan, what they realized was that what was coming next, which was going to be a Chinese government, was something like a return, but also something new. Because they were not being returned to the China that they had left, which was the Qing Empire, which was gone. They were being returned to this new Chinese state, the Republic of China, established in nineteen twelve by the Chinese nationalists,
14:46 Speaker 01 whose leader by the end of World War Two was John K. Shek.
14:50 Speaker 02 我们中国在海岸和西方的
14:54 PJ Vogt? General Chiang Kai-shek, he's in full military uniform on an outdoor podium, declaring victory in 1945 after the defeat of the Japanese.
15:02 Speaker 02 全国军民同胞们，全世界爱好和平的将士们，今天我们成立了 敬意依然
15:12 PJ Vogt? After the Qing Dynasty had fallen, China had fractured into territories mostly ruled by regional warlords.
15:20 PJ Vogt? At the end of that fighting, Chiang Kai-shek's group, the Nationalists, had come out nearly on top with just one rival remaining: the Communists. The Nationalists had also done something very smart during World War II. They'd sided with the Allies and gotten something in return: international recognition as China's legitimate rulers. And a promise that they would be handed all the territories Japan had seized from China at the war's end, including Manchuria, including Taiwan.
15:50 Speaker 01 During World War II, the US, Canada, Australia, and some of the other Allies are fighting in Asia. And a critical part of that action is happening in China. And it's mainly the Chinese that are keeping that going. So from the perspective of the Allied leaders, it's extremely important to keep Chiang Kai-shek and his nationalist army in the war. They're thinking about, you know, what can we offer him to make sure that he stays motivated?
16:29 Speaker 03 It is no exaggeration to say that to see General Chiang Kai-shek and his wife in this Allied assembly was a very real pleasure to everyone.
16:39 Speaker 01 And one of the things they decided to offer him at the Cairo Conference was anything that's a Japanese-held territory that used to be Chinese will go back to the Republic of China.
16:52 Speaker 03 Britain, America, and China expressed their resolve to exert unrelenting pressure on Japan, compelling her to disgorge the territories she has seized and occupied even before the First World War in 1914.
17:05 Speaker 01 We won't have some kind of decision-making process to see who should get it. We're just gonna send it back to China.
17:13 Speaker 03 General Chiang Kai-shek arrives in Shanghai and is greeted by General Weidemeyer, American commander in China. A huge crowd welcomes the Chinese leader. He was absent for nine years because of the war and Japanese occupation.
17:31 Speaker 01 So 1945 rolls around, the Japanese decamp back to Japan, and the Nationalist government, the Nationalist Army, comes to occupy Taiwan because they've been promised that Taiwan will be Chinese territory after the war.
17:48 Speaker 03 But the Japanese did not turn back the same island they had taken 50 years before. They turned back a bomb-blasted citadel, richer in terms of industrial development, but poorer in terms of Chinese fielding.
18:03 Speaker 01 So for a lot of Taiwanese, the feeling was, okay, we don't exactly know these people, but they have the same heritage that we do. So we're sort of cautiously optimistic that this is gonna be fine. And they were really shocked by what happened.
18:19 Speaker 03 After 50 years out of the Japanese, the transition to the rule of the Chinese was painful, both for the people of Pomosa and for the government of China.
18:28 Speaker 01 Because the Nationalists, they had just finished a war with Japan, and they were preparing actively for a civil war against the Communists. So the Communists and the Nationalists had made a temporary alliance to fight Japan, but as soon as the Japanese were defeated, boom, the civil war is just inevitable. So the Nationalists did not send the best of their forces over to Taiwan because they were getting ready for the next step. Who they sent to Taiwan were a lot of kind of conscripted soldiers, many of them not even equipped for battle.
19:13 Speaker 01 Taiwanese wrote about watching... People come down off of the ships with like umbrellas and cooking pots.
19:20 PJ Vogt? Why umbrellas?
19:21 Speaker 01 Well, I guess because that's what that was their personal property that they had managed to hang on to. They were snatched out of the rice fields in southern China to go be in the army. So the Taiwanese were like, whoa, you know, the Japanese were all spit and polish, you know? They knew about army. What is this? So it was kind of like a bad start to begin with. And then from the nationalist perspective, okay, one, these people have been working for the enemy for 50 years. And a lot of them were in the Japanese army. So, you know, from the nationalist point of view, we are taking over kind of enemy territory. So we want to tell the folks that live there, hey, we're all Chinese, but also we're quite suspicious.
20:07 PJ Vogt? And from the Taiwanese perspective, like who are these clowns with their cooking pots and umbrellas?
20:11 Speaker 01 Yes, exactly, exactly. And the next thing the nationalists decide to do is kind of pillage Taiwan for stuff they can use on the mainland.
20:20 PJ Vogt? Oh.
20:20 Speaker 01 So they start taking apart factories and moving equipment to the mainland. Because again, as far as they're concerned, this Taiwan thing, you know, that is like a sideshow that we can deal with later. But right now, we've got to save the Republic of China from a communist takeover. So stuff goes from bad to worse in Taiwan with this kind of tensions rising between these two populations. And then February 1947, a Taiwanese woman was selling cigarettes. She was selling single cigarettes, just like some of the people who have gotten in trouble in the US. And the cops came and somebody hit her.
21:02 Speaker 01 And there were other Taiwanese bystanders and they were just infuriated. You know, here's this woman just trying to get by and you have this stupid tax that doesn't allow you to sell single cigarettes. And now you are abusing this woman and they rioted. And that riot just kind of spread everywhere. And there was a whole island uprising against the nationalists. And the nationalists were like, not ready for that. A lot of police and soldiers went back to barracks or even left the island altogether. And for a couple of weeks, it was like, not clear who was in charge.
21:50 PJ Vogt? Reining local nationalist Governor General Chen Yi on the radio, telling the people he's declaring martial law, in his words, entirely to protect them. This clip is a recreation, but those were his words. What happened next is that on March 8th, nationalist troops landed on the island. They began an indiscriminate campaign of violence against citizens. Soldiers fired into crowds, there were street executions. People were pulled from their homes, tied together by wire to others, and thrown into Keelung Harbor to drown. We'll never know the actual death toll. According to scholars, it's somewhere between 10,000 and 28,000 people.
22:29 Speaker 01 They killed a lot of the leaders, they killed a lot of socially important people, landlords, professors, a lot of intellectuals were taken in, either imprisoned or executed. And they decapitated the society. And those who were not personally affected were very well warned that you do not challenge this government. So that is called the February 28th or 228 Incident, and that's really the defining
23:07 Speaker 01 moment for Taiwan politics ever after, where Taiwanese learned that the nationalists were not going to cut them any slack just because they were Chinese too, but were going to impose their rule with an iron fist, and that Taiwanese were gonna have to figure out how to live under that regime.
23:32 PJ Vogt? Because it's just like an intensely, intensely, nationally, socially traumatic event. After that, everything is just different.
23:40 Speaker 01 Everything is different after the 228 Incident, but it gets really different in 1949, when the Communist Party and its Red Army are successful in defeating the nationalists in the Civil War.
24:01 PJ Vogt? This is the part of the story where it goes from something tragic, colonial violence, to something very, very absurd. A plot twist transpires that does not resemble the history of any other country I've learned about.
24:15 PJ Vogt? So the nationalists, who'd been ruling Taiwan from mainland China, the first thing that happens is at 1949, the nationalists suffer a huge defeat at the hands of the Communist Army.
24:25 Speaker 01 October 1st, 1949, Mao Zedong declares the founding of the People's Republic of China.
24:38 Speaker 03 A monster rally in Shanghai celebrates communism's greatest victory since the coup in Czechoslovakia. Five months ago, the troops of Mao Zedong marched into Shanghai unopposed. That victory was celebrated in July at a gigantic parade in what is today the largest red city in the world, now so isolated.
24:54 Speaker 01 And anybody from the nationalist movement, the nationalist government, army, who can get out of mainland China is out. The whole nationalist government gets transported to Taiwan.
25:10 PJ Vogt? Oh, because this is where they have to go? Because they're being forced off the mainland?
25:13 Speaker 01 Exactly. They're defeated on the mainland. The only place left that they control is Taiwan, and that's where they go. They set up the government there. They take the legislators, who were elected from all over China in 1947. They become the legislature of the Republic of China, but their chamber and their offices are in Taiwan, and they cannot go back to China.
25:36 Speaker 04 明年比今年格外进步， 而且我们其实格外的精良， 我们能够很快地反攻大陆， 来挽救我们。
25:47 PJ Vogt? This is John Kaisak talking just a few years after decamping to Taiwan. No longer the conquering young military leader, now a more tragic figure. The so-called leader of the Republic of China, exiled to a nearby island, claiming that any day now, his nationalist armies will return to the mainland, sweep through, vanquish the communists. He's talking shit.
26:10 Speaker 01 They're gonna go back to China. They're convinced that they will because the mission the nationalist government sets for itself and for the people of Taiwan is we're gonna fight back to the mainland. We're gonna drive out communism and reestablish a real legitimate Chinese state over all of China, including Taiwan.
26:38 PJ Vogt? I had never known this. It's one of the things I learned from Dr. Rigger. While I had actually known that Taiwan had often been ruled by a party called the nationalists, what I'd assumed, of course, was that the nation in nationalists meant Taiwan. It didn't. The nation the rulers of Taiwan were obsessed with was China. They saw themselves as Chinese, deeply Chinese, as the true Chinese government, not the impostor one run by Mao and the people after him. The tragedy they were experiencing, the feeling that something else should have happened, that it was all gonna get fixed next year or the year after, it's the kind of agony you only normally encounter in sports fans. And what would happen next was even more interesting.
27:23 PJ Vogt? As the decades passed, the nationalists running Taiwan would live among the Taiwanese people, people who had been their colonial subjects, people they had treated with violence and subjugation. That proximity would change both sides, would change the shape of the government, the economy. The nationalists would not get what they wanted, they'd get something that was maybe better. That story after these ads.
28:25 PJ Vogt? Welcome back to the show. The story of how Taiwan became a democracy is long and gradual. We're going to watch it in fast forward. Essentially, at the beginning of our montage, you have nationalists from China running Taiwan. But as the decades pass and they fail to take back their mainland, what will happen is they will get old, and they will die, and they will have to be replaced. And the nationalists can't go to mainland China and go get more colonial rulers. That's the country they're in exile from. So over time, the nationalists start letting the Taiwanese people run for office. Low-level office at first, but the democracy just keeps going with help from activists, with help from time, from the bottom up.
29:09 PJ Vogt? And by the 1990s, Taiwan has a very different government from mainland China. Two states, siblings separated by a schism, growing more and more different as the years pass. Sometimes you could watch the same idea take hold in China and Taiwan, but expressed in crucially different ways. For instance, in China in the 1950s, Mao enacts land reform. He decides that landlords are evil, has 1 to 2 million of them killed, and gives their land to poor farmers. It's an atrocity. The poor farmers in the end also don't actually get to keep the land. Taiwan also does land reform, but a gentler, more interesting kind. Taiwan confiscated land from landlords who owned above a certain amount, but the process was much less insane.
29:54 PJ Vogt? The landlords, compensated by the government, were also given shares in some big state-owned companies. Rather than shooting them, Mao's version, in Taiwan, the idea was to absorb these landlords into the state industrial class, which kind of worked.
30:10 Speaker 01 Land reform in Taiwan had a little bit of a capitalist flair to it because you had to pay for it and the price was very low. And the government gave farmers a lot of support to be successful in agriculture. And then the people whose land was appropriated were also paid. Again, not as much as they would have liked to have been, but enough that it wasn't like the same vibe as in the mainland where it was a violent appropriation of land.
30:38 PJ Vogt? It's not somebody shows up at your house and says like, "You capitalist pig." It's a little closer to like eminent domain.
30:44 Speaker 01 Yes. Yeah, exactly. And one of the things they did was they paid some of the landlords, not only in cash, but also in shares in companies. So they're already thinking ahead to industrialization, right? So that unleashed a huge explosion of agricultural productivity. And a lot of rural families very quickly began to accumulate money. And what are they going to spend their money on? They're going to spend their money on making a little workshop or a little factory. And the government also made sure that as little manufacturing industries appeared, they would have what they needed.
31:27 Speaker 01 So the state took over the upstream industrial sector. So petrochemicals, so that you have plenty of plastic. And if you think about Taiwan's exports in the 1960s, 70s, 80s, plastic is at the core.
31:41 PJ Vogt? Yeah.
31:42 Speaker 01 Cement, steel, shipbuilding, logistics, transportation, energy, all the things you need to be sure that if you can make a Barbie, you can get her to the US for sale, right? So all over Taiwan, people start in their backyards, in their garages, in little factory buildings that they built in the middle of a village. They start making every kind of consumer doodad you can imagine.
32:13 PJ Vogt? And is this, are a lot of these consumer doodads, I'm curious about America's relationship to Taiwan during this period. Is it like, we are the buyers of these consumer doodads? Like, what, how are we positioned?
32:23 Speaker 01 We are 100% the buyers of these consumer doodads, right?
32:26 PJ Vogt? And what are the consumer doodads? What are we buying? What are they sending us?
32:29 Speaker 01 Yeah. Right after World War II, your listeners may not remember, but for your grandparents, everything was made in Japan, made in Japan, made in Japan. For my generation, 1970s, everything was made in Taiwan. And there's a funny moment in Toy Story where Buzz Lightyear, who, remember, thinks he is a real guy.
32:51 PJ Vogt? Yeah.
32:52 Speaker 01 You know, they're all telling him, dude, you're just a toy. He pops open the cuff of his glove and it says it right there, "Made in Taiwan." That's when he knows, "Oh, I'm not a real person. I'm actually a toy like everybody else in this box." So it was toys, it was apparel, it was our bicycles, it was, you know, our writing implements, the pens and pencils, the little stationary objects, but also all kinds of things that go into like electronics, you know, a transistor radio. And actually, the whole transistor radio could be made in Taiwan by 1980, maybe even before. But lots of little connectors
33:37 Speaker 01 and wire specialized components for electronic devices, things like Christmas decorations, you know, all of those kind of high-volume, low-tech consumer goods. Production shifted from Japan to Taiwan and Korea, especially in the 70s and 80s, as Japan is upgrading into auto manufacturing and a lot more heavy industry and high-value equipment.
34:14 Speaker 01 So the US, for its part, is happy to get all this stuff because after World War II, the US wanted industrial upgrading. We don't want to be making like cheap junk in the US.
34:24 PJ Vogt? Yeah.
34:25 Speaker 01 We want to be making expensive things that have a high profit margin. So we threw open our market to these Northeast Asian manufacturing partners so that they would do the low end and our consumers would benefit from low prices and our manufacturers would be sort of driven up the value chain. So that's what Taiwan was doing. And that was a very sort of democratic economic pattern because they weren't forming huge companies. Most of Taiwan's export oriented manufacturers were and continue to be quite small by global
35:06 Speaker 01 standards and very nimble and flexible. So, you know, if we're no longer making Skipper, we're making Ken this year. All those Barbie villages where they literally made all the Barbies and all their clothes and they put it all in the packages and all their shoes and pocketbooks and everything. You know, we just get new molds from Mattel and we immediately shift production from one thing to another.
35:31 PJ Vogt? Got it.
35:31 Speaker 01 So that enriched most Taiwanese. So if you think about Taiwan in the post-war period, what people saw was their standard of living steadily rising and the quality of life going from being a pretty rugged agricultural society to by the 1990s, they're beginning to be post-industrial.
35:57 PJ Vogt? So then you have a democracy that is also a really serious economy. I would understand also is like, how does Taiwan then go from there to now? Because now it's not like, oh, the place that makes all the Barbies. It's like the industrial powerhouse that is producing the thing that the entire world economy is obsessed with. Like, how does that happen?
36:19 Speaker 01 Right.
36:22 Speaker 01 1987 was a big year in Taiwan. The president was Jiang Kai-shek's son, Jiang Jingguo, and he made a couple of super consequential decisions.
36:34 Speaker 05 In Taiwan today, the parliament passed a new national security law that paves the way for ending martial law next month. Martial law has been in effect on Taiwan for 39 years now. And the new law will permit civilian trials and greater freedom of the press.
36:49 Speaker 01 On the political side, he decided to lift martial law, which was a major obstacle to democratization. But the other thing he did was he said, "We need to let people travel to the mainland because we've got all these former soldiers and administrators, you know, all these people who came here between 45 and 49, and they have not seen their parents' graves. They have not seen their wives and children that they left because they thought they were coming back. We need to let them go back before it's too late." So they opened travel to mainland China. So, you know, a lot of old men get on airplanes. They fly to Hong Kong, then they fly into mainland China. Well, they've got their sons and sons-in-law with them,
37:34 Speaker 01 carrying the luggage, that's how I imagine it. And they're not there to see people's graves. What they see is a spectacular economic opportunity. This is China 10 years into reform and opening. So Deng Xiaoping has told every local official, "You gotta make GDP happen in your locality, right? Find ways to grow, find ways to bring industry into your village." And here are these Taiwanese guys. They own manufacturing businesses back in Taiwan, and they're being approached at the airport by local officials from Chinese villages who say, "I can give you land, I can give you a building,
38:18 Speaker 01 I can give you a workforce that will be well behaved and very low paid. I will not make you pay taxes for the first many years that you're here. Oh, wow. I will set everything up for you." If you will open a factory here. So between 1987 and about 1992, Taiwan's traditional manufacturing, so all those Barbies just decamped to the mainland and they set up factories, a lot of them using the same equipment. You know, they send the machinery and they send the managers all over to the mainland and they start making the same thing at a tiny fraction of the cost. We talk about Walmart and the Walmartization of the US economy a lot.
39:02 PJ Vogt? Yeah.
39:02 Speaker 01 And we think about, you know, when China became the factory to the world and, you know, all of a sudden Walmart can sell you all this stuff so super cheap. These are Taiwanese companies in very large part. Taiwanese companies, they were selling you the same thing yesterday and it was made in Taiwan and their cost of production was, you know, 10. Now they're making it in mainland China. It's the same thing, made on the same machine with all the same techniques, but now it's made in China and the cost is 2. And, you know, something that really scared people in the 1990s was what do we do now, right? Because if you outsource all of your manufacturing, what's left for your domestic economy?
39:46 Speaker 01 Where are people going to find jobs? And the most incredible part of Taiwan's story is that after the low-value, low-tech manufacturing shifted off to China, there's this kind of empty bucket. And the state partnering again with private entrepreneurs and scientists filled the bucket. And what they filled it with was high-tech manufacturing.
40:19 PJ Vogt? So they basically say, "Look, we were in the business of Barbies for America, Barbies for the world. That's going to happen in China now. What does it look like for the state to decide we're going to make, I guess, what ends up being chips? Like, how do they do it?
40:33 Speaker 01 One of the really important components of Taiwan's economic policy has always been a certain amount of state direction, but also a lot of state support for research and development.
40:50 Speaker 01 So they founded this thing called the Industrial Technology Research Institute, ITRI, and that's a huge incubator for technology companies to help Taiwanese scientists, engineers, and entrepreneurs figure out how they could identify good concepts in the tech space and bring them to market. So there's a lot of government money in that sector, and the goal is to spin off private companies. So TSMC, Taiwan Semiconductor Manufacturing
41:29 Speaker 01 Corporation, is the most famous of these. And TSMC was basically the brainchild of Morris Chang.
41:37 Speaker 05 I was born in 1931 into a middle-class family in China. And I lived in China until I was 18 years old, when I moved to the United States.
41:54 Speaker 01 A Taiwanese-American, right? He had been educated as a youth in Taiwan, moved to the US for higher education, and then worked for Texas Instruments.
42:04 Speaker 05 But then Taiwan beckoned, and the offer was to be the president of the Industrial Technology Research Institute, ITRI, in Taiwan.
42:18 Speaker 01 He was enticed to come back to Taiwan by the opportunity to do something unprecedented, which was to make a foundry for semiconductor chips that would not be doing the design, that would not be involved in marketing, sales, but would just be manufacturing the chips, specialized in that part of the process, for other companies like Intel that provided the design.
42:50 Speaker 05 We had no strength in research and development, or very little, anyway.
42:56 Speaker 05 We had no strength in circuit design, product design. We had little strength in sales and marketing. And we had almost no strength in intellectual property. The only possible strength that Taiwan had, and even that was a potential one, not a obvious one, was semiconductor manufacturing.
43:26 Speaker 01 Now, of course, TSMC has become incredibly innovative. It's not waiting on anybody to tell it how to advance the technology in that business. But the idea of what they call a pure-play foundry. So the goal is just making the chips. That was Maersk Chang's idea. And he was able to partner with the Taiwanese government to turn that into a business, to actually build foundries, to get orders, and to become the favored source, not just for one company, but for all companies that wanted to design chips and have them built somewhere. You know, and it's also a very Taiwanese thing to do, right?
44:11 Speaker 01 To say, I don't need a brand. I don't need my company to be famous. I don't need for anybody to say, ooh, that's a TSMC chip in there. I just need to get really, really good at doing something and selling a lot of it to customers who they can worry about, the marketing and the branding. And, you know, like if your CEO gets in trouble, then suddenly nobody wants to buy your stuff. Like, I don't want to worry about any of that. I just want to make chips that are going to be great, and everybody's going to want them. And that's actually a really Taiwanese kind of way to look at it.
44:46 PJ Vogt? Because why? Like, what is the cultural belief underneath it? Just like a culture that like less celebrates marketing and image and more celebrates quality?
44:55 Speaker 01 I don't think it's a sort of deep cultural trait. I think it's what Taiwanese manufacturers learned from being contract manufacturers for international brands in the early years of their export oriented manufacturing boom. So like I said, you heard the brands I listed Adidas, Schwinn, Mattel, none of these are Taiwanese, right?
45:21 PJ Vogt? Right.
45:22 Speaker 01 We never heard of a Taiwanese brand until Acer, Asus, and Giant Bicycles. So it wasn't something that Taiwanese manufacturers thought they could do or even felt was necessary because they were doing really well doing contract manufacturing, meaning selling to someone else. And so I think maybe Maerscheng's mind was available for that concept in a way that someone who came up at Texas Instruments or IBM, their mind was not available for that.
45:53 PJ Vogt? It's like there was a different model of what a kind of industrial success could look like because that model had been proven out.
45:59 Speaker 01 Yes, exactly.
46:01 PJ Vogt? And so like today, 2026, like I'm sitting in a room right now with like a laptop, which has inside of it a chip by TSMC. I have my iPhone, which has a chip by TSMC, the chips powering Quad, a ChatGPT, and Gemini. Like, all these things are made by TSMC. It is still the thing that kind of like, I think other people understood before me. I still feel boggled by it that like so much of the technological progress is all coming from chips made in this one tiny island. Like, it's a very strange thing.
46:31 Speaker 01 Well, I'm gonna make it worse for you because it's not just the chips that are made on this tiny island, right? Those chips are part of an industrial ecosystem that they don't just make semiconductors. They make everything that you need, maybe not quite everything, but they make mostly everything you need to make these chips. And they make a lot of things from the chips and they make a lot of things that support the deployment of the chips. For example, another company that I've visited, they started out making
47:10 Speaker 01 Those metal slides that you put in kitchen drawers, you know, to make your drawers smooth.
47:15 PJ Vogt? Yeah.
47:15 Speaker 01 And then they got really good at that. So they started making slides for chemistry labs and NASA kinds of places, you know, places where the drawers need to slide really smooth.
47:25 PJ Vogt? Yeah.
47:26 Speaker 01 And then they looked around and they were like, all right, what else can we do? And they saw that data centers, the huge arrays of chips that is they're all interconnected and they're all talking to each other in a GPU that they've got to be able to come in and out because they have to be replaced and serviced. They have to be cooled because that's another whole problem with data centers. You know, it's just the heat that that stuff creates. So then I said, well, we can make the slides. So every single board in every single array, in every single data center in the whole world to be one of these sliding, you know, thingies. And, you know, like, all this stuff is being made in Taiwan.
48:11 Speaker 01 And none of these businesses are going to be easily transferred or replicated someplace else because they're super integrated with one another. They're all right next to each other. They talk to each other every day. And they operate at an incredibly high level of efficiency and quality.
48:32 PJ Vogt? And I mean, this is what I wanted to ask you is like, why can't someone else, presumably someone in the United States or in China, do what Taiwan does? What you're talking about is it's a story about people. It's like you have all this expertise, all these people who've been getting better and better and better at doing things alongside each other. And the things they know how to do, the sort of process knowledge they have is integrated with process knowledge that other people around them have.
48:55 Speaker 01 Correct. Yeah.
48:58 Speaker 01 And if you really wanted to prepare an American community to take over one of these ecosystems or to create an ecosystem that could mirror what happens in Taiwan, you would need to start with pre-K, right? Because the society is being educated from early childhood to be able to fit into that industrial structure. Recently, I was in Taiwan and we were on a bus going between two places and I saw a huge industrial park under construction. So it's a huge building and I thought, I bet you that's a TSMC fab, but I couldn't see the sign on it.
49:42 Speaker 01 Later, one of the other people on the bus said, yeah, that was a TSMC fab under construction. But what I could see was the sign on the building under construction right next to it. And what it is, is a technical high school.
49:57 PJ Vogt? Wait, because why?
49:58 Speaker 01 Because high school and industry are joined at the hip. The kids who go to that technical high school, so it's like a vocational school.
50:09 PJ Vogt? Yeah.
50:10 Speaker 01 They will finish high school basically with the, the training of a, you know, BS degree engineer at a lot of American universities. And they will walk straight into TSMC and go to work and they will have been trained and educated not only to do what TSMC needs them to do today, but to be able to grow with the company over time. So they may be technicians, but they are really smart and they are really good at way more than just, you know, like soldering two things together.
50:45 PJ Vogt? So like what is cool about the American education system is that we treat our students often, for the most part, as people who get a lot of time to ultimately figure out what they're going to do as adults. But then you have like people like me who graduate college with a degree in like semiotics or whatever, or drop out of college with a degree in semiotics. What you're saying is that the Taiwanese education system is like, for a lot of people, we know what this country is doing really, really well right now and we're going to start pointing you at that and specializing you at that at a way earlier time horizon because in the United States vocational school exists, but it's not aimed at highly, highly lucrative jobs necessarily. But I'm imagining that chip manufacturing in Taiwan is a highly lucrative job.
51:28 PJ Vogt? And so you have people specializing earlier and there's sort of like social upside to that.
51:34 Speaker 01 Right. And they learned a lot of math in elementary school. That's how they can be in a position to move through this technical high school. So, yeah. Fascinating. And not everybody wants to work at TSMC.
51:51 Speaker 01 But I think what I see in Taiwan, although my friends there complain all the time, in the same way that my friends here complain all the time. But what I see in Taiwan is that this kind of foundational industrial strength has provided sufficient prosperity for people who would like to have a graduate degree in semiotics, or political science for that matter, can do that and can make a living. Whereas in a country without that kind of powerful industrial foundation, it is very hard to sustain a lifestyle that gives people choice and freedom.
52:38 PJ Vogt? So that's the story of how Taiwan became an indispensable manufacturer of the chips powering the AI race.
52:46 PJ Vogt? We're going to take a short break. When we come back, what the world might look like if war breaks out.
52:54 PJ Vogt? It's after these ads.
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54:24 PJ Vogt? Welcome back to the show.
54:29 PJ Vogt? So I asked Shelley just to help me picture the future that right now everyone's trying to avoid. The world where some kind of conflict shuts down Taiwan and TSMC, its big chip manufacturer, stops producing, where suddenly the rest of the world cannot source the chips that drive so much of our technology.
54:48 PJ Vogt? What she painted was less an apocalypse, more of a prolonged global interruption, which reminded me slightly of the pandemic, actually.
54:56 Speaker 01 Removing the option of having TSMC make specialized chips for your business means that either you got to change the product, which you could do, right? You know, right now, Chinese companies that could, they would do a lot better if they only had access to TSMC's most advanced chips or managing without it. They're doing things in a different way. It might be a little bit more cumbersome, take longer, not have the same high efficiency, but you can do it. Or you have to just charge more because you've got to find another supplier who is not going to have that high efficiency.
55:37 Speaker 01 So I don't think it's that Taiwan's chips are irreplaceable in the sense that there's some kind of value or utility that they provide that cannot be achieved other ways. But they are irreplaceable at a certain price point. And they are at least temporarily irreplaceable in the sense that, you know, no one else is making what they're making. But no one else is making it because no one else could make it. As inexpensively and with the same quality level. So it's not like forever and that it's irreplaceable. It's just that we would all change a lot.
56:18 Speaker 01 And like the pace of AI development would probably slow down a lot. And, you know, not everybody would think that was a bad thing.
56:28 PJ Vogt? No, no.
56:28 Speaker 01 Those are the changes that I think would ensue if we lost access.
56:34 PJ Vogt? So if, if like the factories went dark tomorrow, a month later, or six months later, you would have the world as a recognizable thing. It's just the pace of technology would greatly slow. And the technology that we had access to would probably be much more expensive.
56:49 Speaker 01 Right. And I think what really scares people about the kind of conflict or events that would cause those factories to go dark is not just the loss of their output, but the secondary effects on the global economy. So, you know, where is the growth in the global economy? It's in tech. It's in specifically the whole network of products and services surrounding artificial intelligence. So if we pull the rug out from under artificial intelligence, what's the growth engine?
57:27 PJ Vogt? Right, right. Like people talk about how the US economy is basically like a recession tied to the balloon of AI. And that's also in many ways true globally. And so you have this, this like small place with an even smaller group of people with this very particular expertise. And they're just important in a way that would have been almost unfathomable years ago. Like it's just the degree to which both the global economy is very connected, but also that the technology story is one technology story and the financial markets are that technology story. It's just like you have a kind of like concentrated vulnerability that is just kind of unprecedented.
58:05 Speaker 01 Right, right. And, you know, it's at the moment converging with another huge kind of underappreciated vulnerability, which is the Strait of Hormuz.
58:17 PJ Vogt? Why are those things converging?
58:19 Speaker 01 Well, I think it's, I truly believe that the sort of immediate convergence is coincidental, right? Taiwan was going to be where it was, and then the US decided to go to war with Iran, not really anticipating that Iran had the power to close the Strait of Hormuz and plunge the world into an energy-related recession. But, you know, I think we always talk about interdependence, and people argue, scholars argue, does globalization, interdependence, do these forces promote peace or not? Because the theory goes that they do.
59:00 Speaker 01 And I think what we see is if we ignore peace, we will feel the effects of having allowed ourselves to become so interdependent.
59:14 Speaker 01 So they don't prevent conflict? The fact that everybody depends on the Strait of Hormuz for their energy didn't stop Trump from going to war, but we are all paying a much higher price than we would be paying for this war if this dimension were not there. And I think it's similar with respect to Taiwan. I do think that Taiwan's importance in the global economy is a factor in China's restraint so far in taking military action against Taiwan, but that doesn't mean it's going to work forever. But when and if something happens in the Taiwan Strait, we will all feel the effects
59:57 Speaker 01 of that interdependence much more strongly than we would if we had not created these tech supply chains that chase quality and price across every global boundary.
1:00:14 PJ Vogt? And so for Taiwan right now, the fact of interdependence, it's like temporarily, the best way to understand it is that in the short term, it is making Taiwan safer. It is not a kind of like permanent shield, especially in a world where America is run by someone who seems to kind of bulldoze through what was the status quo, in some part based on people's understanding of the consequences of breaking some of these agreements.
1:00:41 Speaker 01 I think what I am learning as I get older is that nothing is permanent.
1:00:46 PJ Vogt? God.
1:00:47 Speaker 01 And that what we are trying to do in international relations is to maintain a kind of dynamic stability as long as possible, while larger forces are moving the ground underneath us. So I've always tried to impress upon my students in my international relations classes, the bias of a policymaker in the international realm is always to do nothing, to do as little as possible to just prevent things from getting worse.
1:01:24 Speaker 01 That's so unsatisfying and frustrating, but it is the wisdom of the international policymaker to understand that almost anything you do will have unintended consequences that will make the situation worse. So you just want to do as little as you can to hold things in that kind of dynamic tension.
1:01:48 PJ Vogt? So I think the last thing I'm hoping to get is a picture of that dynamic tension as it exists right now, like this like not quite frozen status quo. Like what is like, what's the temperature in Taiwan right now towards China?
1:02:02 Speaker 01 I think the essence of the disagreement between Taiwan and especially the Taiwanese people and the PRC government, so the Chinese government, the, at the heart of that failure to find a shared ground is that for the Chinese Communist Party leadership, and this is certainly an idea that predates them, you know, this was also John Cai's idea, and they have
1:02:34 Speaker 01 inculcated this idea in the minds of many people in mainland China. Their concept of what constitutes a nation is rooted in history. The actual history of states evolving over generations. And also the kind of human history of we are a civilization. And our civilization has certain attributes that that exist within people who are alive at any given moment. And so being attached to that thing historically, ancestrally, culturally, that thing being China.
1:03:12 Speaker 01 Means that you are and should be and in the future must be more fully a part of China. So in mainland China, the idea is Taiwan used to be part of the Qing dynasty. We are the current embodiment of what Qing dynasty was embodying back then. So I need, we in the PRC need for Taiwan to come under our flag. One way or another, sooner or later. In Taiwan, the concept of the state, right, is consent to the governed. They bought into classical liberalism sometime in between about 1920 and 1990. And they just don't see why.
1:04:00 Speaker 01 Just because our ancestors lived in China, we gotta be part of the PRC. It just, it's not a meaningful understanding of political identity in Taiwan. So that disagreement leaves them with very little common ground for some kind of compromise that satisfies both sides.
1:04:24 PJ Vogt? Right, because it's not about a narrow who's in charge. It's about this much broader question of how, how do you decide where you belong? What is the citizen's relationship to the state? Like, it's not different politics, it's different political worldviews.
1:04:39 Speaker 01 Yes, exactly.
1:04:46 PJ Vogt? So that's the story in miniature of how we got to where we are today, to Taiwan in 2026, an island just a little bigger than Maryland that's evolved from a frontier through multiple colonizers, through violence, to a democracy. A tiny powerhouse country, vulnerable, but also, by dint of its own genius, very powerful. Thank you for talking to us about this. Thank you for sharing your vast expertise here.
1:05:14 Speaker 01 You're very welcome. My pleasure.
1:05:19 PJ Vogt? Dr. Shelley Rigger. She's the Brown Professor of Asian Studies at Davidson College. We'll have a link to her most recent book about Taiwan in our show notes.
1:05:30 PJ Vogt? Obviously, there is more here to learn than we were able to cover in an hour. I actually found myself still curious when we were done talking. I wanted to know what conflict would actually look like between America and China over Taiwan if it broke out. I wanted to know if anyone is doing anything to make that conflict not happen. If you're curious about that, too, we have a bonus episode for you that is all about it. It'll be in our incognito mode feed with historian Ike Fryman. He told us about what options the US might have in the near term. One thing we can do is we can increase our military-to-military relationship with Taiwan, which is not formal, but informally, there's a lot of very, what I like to call burly English teachers hanging out in Taiwan.
1:06:16 PJ Vogt? Let me put it that way, right now. Right now. Everyone knows it's true. Ike does some war gaming. He walks us through the scenarios experts on both sides are planning for if things get crazy. Incognito mode subscribers only. You can subscribe, as always, at searchengine.show. That will be in your feeds next week.
1:06:50 PJ Vogt? Search Engine is a presentation of Odyssey. It was created by me, PJ Vogt, and Trudy Pinamaneni. Garrett Graham is our senior producer. Emily Multer is our associate producer. Theme original composition and mixing by Armin Bazarian. Fact checking this week by Piper Dumont. Special thanks this week to Yeh Buji. Our executive producer is Leah Reese Dennis. Thank you to the rest of the team at Odyssey. Rob Morandi, Craig Cox, Eric Donnelly, Colin Gainer, Moore, Curran, Josephina Francis, Kirk Courtney, and Hillary Schaff. If you have a business and would like to advertise on our show, please shoot us an email at [email protected] / advertising. If you would like to not hear ads on our show, sign up for incognito mode, searchengine.show. Thank you for listening. We'll see you in two weeks.
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