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Insight

Democracy in Hong Kong

Aired March 16, 2004 - 23:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(BEGIN VIDEO CLIP)
JONATHAN MANN, CNN HOST (voice-over): The heat in Hong Kong. Democracy advocates are feeling a new kind of pressure from the Communist Party in Beijing.

MARGARET NG, POLITICIAN IN HONG KONG: There is a huge dosage of intimidation. You are singled out. You are stigmatized. People are told not to be too close to you.

(END VIDEO CLIP)

MANN: Hello and welcome.

Hong Kong was promised many things when it reverted to Chinese rule in 1997. One of those promises was a chance at democracy. Right now its people pick some of their lawmakers, but not all. Back in the year 2000, for example, they chose 24 of the 60 members of their legislative council. In the elections that are scheduled for September, they will choose 30, one half of the council, potentially enough to begin challenging Beijing in a new way and demanding more democracy and autonomy.

China is taking a very public approach to the democrats. It's trying to discredit them.

On our program today, one country, two systems and trouble.

CNN's Mike Chinoy had this report from Hong Kong.

(BEGIN VIDEOTAPE)

MIKE CHINOY, CNN CORRESPONDENT (voice-over): It is at its heart a Chinese city. Of its 7 million people, 98 percent are Chinese. Its habits, its rhythms are Chinese.

So too its food, its smells, its very soul. But Hong Kong is a Chinese city like no other. Created by Britons in the heyday of empire a century-and-a-half ago, filled by Chinese, many of whom were fleeing upheaval and depression in Mainland China. A crossroads of East and West, geographically and culturally attached to China but with its capitalist way of life, its political freedoms and Western-style legal system, very different from the Communist system just a few miles away.

In 1997, the Union Jack came down for the last time. Britain handed Hong Kong back to China under a formula called One Country, Two Systems, where Beijing agreed to preserve the territories liberties and way of life for 50 years.

(on camera): Following the handover, Beijing confounded the skeptics by generally keeping its hands off Hong Kong, but now in its most forceful intervention since 1997, China has branded the territories leading democracy advocates as unpatriotic and declared them unfit to hold high government office.

(voice-over): This man has been Beijing's main target, Martin Lee, lawyer, legislator and long-time head of the Hong Kong Democratic Party, which has led the fight for more representative government.

MARTIN LEE, HONG KONG DEMOCRATIC PARTY: Beijing is extremely worried that come September the democrats, small letter "d", may win the majority in the legislative council. So they are doing everything they could possibly think of to try to stop them.

CHINOY: Beijing's rhetoric and tactics have been reminiscent of old- style Communist campaigns. Opposition leaders here were denounced for trying to subvert the central government, for engaging in activities that harm China, for using democracy to fool the public.

And Lee, who testified about Hong Kong before the U.S. Senate earlier this month, was described as a traitor.

UNIDENTIFIED MALE (through translator): Why would people in Hong Kong encourage foreign countries to interfere in China's internal affairs? To do so is obviously an act of treason.

CHINOY: Opposition lawmaker Margaret NG is another one of those targeted by Beijing.

NG: There is a huge dosage of intimidation. You are singled out. You are stigmatized. People are told not to be too close to you.

CHINOY: China's tough new line appears to be a response to huge protests last summer. That's when Hong Kong's highly unpopular Chief Executive Tung Chee Hwa, who was appointed by Beijing, tried to introduce Draconian anti-subversion legislation.

Hundreds of thousands took to the streets to oppose the bill and demand the right to choose their own leaders.

Under Hong Kong's post-colonial constitution, the basic law, citizens are promised universal suffrage and the right to freely elect the legislature and the chief executive as early as 2007. But it's becoming clear that Beijing's definition of elections is that it should control the outcome.

UNIDENTIFIED MALE (through translator): Patriots must form the main body of those who participate in the governing of Hong Kong.

CHINOY: In this glittering, sophisticated city, China's muscle- flexing has sparked not just anxiety, but an intense debate about what it means to be patriotic, and many, including young people like Boy Bo Yip (ph) and Chan King Fi (ph), don't accept the view that being patriotic means kowtowing to the Chinese Communist Party.

UNIDENTIFIED MALE (through translator): The Beijing regime does not have democratic elections, so any people who want to democratically elect their own government are going to come into conflict with it.

UNIDENTIFIED FEMALE (through translator): Patriotism is just a name, a word dividing people, us and them. Beijing people are patriotic or unpatriotic. It's not a real basis for judgment. It's like how the Communists used to label people leftists and rightists.

UNIDENTIFIED MALE (through translator): Frankly, this whole patriotism thing is a pretty Aryan concept for us. I live in Hong Kong. I read Hong Kong papers and magazines. I'm interested in Hong Kong celebrities. For most people like us, patriotism is a very distant thing.

CHINOY: Indeed, until recently fragmentism rather than patriotism has defined Hong Kong, especially its remarkably successful business community.

When the British were in charge, many were happy to have the label "Sir" in front of their names. Now with China clearly calling the shots, many tycoons have endorsed Beijing's faux patriotism, anti-universal suffrage campaign. Among them, American-educated construction magnate Sir Gordon Wu.

SIR GORDON WU, BUSINESSMAN; You see the danger is that (UNINTELLIGIBLE) the majority. There are people (UNINTELLIGIBLE) and then once they recognize there is a majority, then they do all sorts of terrible things.

CHINOY: In a city known not just for its China trade but as a regional financial center, the patriotism movement has left many foreign businesspeople uneasy.

UNIDENTIFIED FEMALE: Since the handover in '97, I think most people have noticed that Beijing has been prudent and careful and some people would use the phrase hands-off when dealing with Hong Kong. And now what we're seeing is something quite different.

CHINOY: Steven Vines (ph) is a political analyst who's lived in Hong Kong for nearly 20 years.

STEVEN VINES (ph), POLITICAL ANALYST: I think you'll find Hong Kong as an international financial center, will have its very foundations cut away from it, and that's very serious.

CHINOY: The irony is that the vast majority of Hong Kong people, including many who took to the streets last year, are not anti-China.

NG: In fact, Hong Kong is a singularly patriotic community in the sense that there is a strong identification with the Chinese heritage, even with the Chinese nation, even if they don't agree with the Communist Party or the form of government.

CHINOY: Indeed, when China's first astronaut visited the territory after his successful flight last fall, he was mobbed by well-wishers. The crowds that flock to the annual Open House at the Chinese Army Garrison here are uniformly friendly.

But now Beijing's campaign has opened divisions so sharp that pro and anti-democracy activists scuffled when Martin Lee returned from his controversial visit to Washington.

LEE: It reminds people of the bad old days, of the cultural revolution. And Hong Kong people don't like it a bit. But, of course, some people are frightened, absolutely frightened.

CHINOY: But many, including those who previously viewed the Chinese government in a more positive light, are taking a different view.

UNIDENTIFIED MALE (through translator): These threatening statements from China are really going to make people more likely to vote for democratic candidates.

CHINOY: And that could mean China's patriotism drive could produce precisely the result Beijing is trying in such a heavy-handed way to prevent.

Mike Chinoy, CNN, Hong Kong.

(END VIDEOTAPE)

MANN: We take a break now. When we come back, a basic law and things get complicated.

Stay with us.

(COMMERCIAL BREAK)

MANN: Hong Kong Chief Executive Tung Chee Hwa was not elected to his office and if the people he governs had a chance to vote, he wouldn't be. A Hong Kong University poll last month found that only 13 percent of local residents approve of his leadership. Tung's second term in office expires in 2007. After that, democracy advocates want to gain the right to vote in his successor

Welcome back.

Hong Kong's constitution, the basic law, describes full democracy as its ultimate aim, but it doesn't actually provide for it. Activists are trying to rally public opinion to win election rights that aren't now laid down in law, and as we've been seeing, Beijing is pressing back.

A short while ago we got in touch with Michael DeGolyer of the Hong Kong Transition Project, a scholarly organization that studies the territory.

(BEGIN VIDEOTAPE)

MICHAEL DEGOLYER, HONG KONG TRANSITION PROJECT: I think it's very serious, for two reasons.

No. 1 is that what they're talking about is not just names. What they're talking about are what they call principles, and those principles are a particular interpretation of the One Country, Two Systems slogan, which they're applying to the interpretation of the basic law, rather than a common law approach to the basic law.

And when you take their interpretation of One Country, Two Systems, basically they're saying the Chinese constitution says the Communist Party has a leading role, has a deciding role, has the determining role. It legislates and interprets the law -- the Communist Party does. The Communist Party is the sovereign of China. Hong Kong is an inalienable part of China. Therefore, the Communist Party, in essence, can make all the decisions about anything having to do with the basic law and particularly in this case whether or not we go to direct elections for the chief executive and for the legislative council in 2007 and 2008, respectively.

MANN: Why is this happening now? Is it because of the election calendar in Hong Kong? Is it because of something happening behind the scenes in Beijing? Or as you seem to be suggesting, is it the kind of thing that was inevitable given the overlap of one political culture on top of another?

DEGOLYER: I think it's a bit of all of that. It's particularly driven by the calendar because of the very shortly upcoming Taiwan election. You might have discussed that -- I'm sure you have.

In the case of the Taiwan election, you have two presidential candidates, one of whom leans towards some sort of accomodation with the Chinese government, the central government, some sort of reunification under certain principles, which seem to be moving at this point. The other candidate very clearly stands out for the independence of Taiwan and the total separation, the separate identity of Taiwan from Mainland China.

And so that election is really driving I think a lot of the anxiety and concern, particularly among the conservatives in Beijing. You might know that the conservatives in Beijing are led by former President Jiang Zemin, who is now the chair of the Central Military Commission. There are a number of other officials who are within that what used to be called Shanghai Faction. And they are particularly concerned about the relationship with Taiwan. That's kind of what Jiang Zemin wanted to cap his career with achieving, and that is certainly endangered.

The other reason why they're very upset about this right at the moment is that the legislative council election in Hong Kong takes place in September, and for the first time it looks like there is a very real possibility that even with only half the seats directly elected and the other half indirectly elected, that the so-called pro-democracy groups here will actually gain a majority in the legislative council and, with that, a great deal of influence, and that's also why they're being attacked right now.

MANN: Is this kind of campaign likely to work? Are the people in Hong Kong likely to respond the way Beijing hopes?

DEGOLYER: Well, they've tried this before, twice, in the case of Taiwan, and it didn't work either time there, and it looks like it's failing again.

Hong Kong voters also had this tried on them, for example, back in 1995, and it didn't work then. In fact, under the last election under the British, there were more directly or in effect directly -- in other words, they had much larger electoral bodies for the indirectly elected seats. In some cases 200,000 voters. Nowadays it's down to maybe 100 to 200 or at most 2,000 or 3,000 voters in those seats.

And the democrats at that point won a majority. So I think, you know, they're basically very concerned about this, and they're trying everything possible. And like I say, it's also the conservative faction, I think, that's even most concerned about Hong Kong.

MANN: Michael DeGolyer, of the Hong Kong Transition Project, thank you so much for talking with us.

(END VIDEOTAPE)

We take another break and then we pick up on the example that we just heard about, Taiwan. A similar conflict with Beijing that could turn much more serious.

Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MANN (voice-over): The vote in Hong Kong is still months away, but Beijing is watching with frustration as another election approaches, this one in just days and potentially much more dangerous. It's in Taiwan.

UNIDENTIFIED MALE: We are saying no to China, yes to Taiwan.

(END VIDEO CLIP)

MANN: Welcome back.

Beijing regards both Hong Kong and Taiwan as essential parts of China itself. The people of Hong Kong never contested that status and never contemplated conflict over it.

In Taiwan, though, a combined election and referendum on Saturday are raising both possibilities.

CNN's Mike Chinoy has this report now from Taipei.

(BEGIN VIDEOTAPE)

CHINOY (voice-over): The campaign trail, Taiwan style. On this island just 100 miles from Mainland China, a celebration of democracy and a political drama that's reverberating in capitals as far away as Beijing and Washington.

(on camera): In fact, diplomats, political analysts and security specialists say the outcome here could provoke a major new international crisis, one that in the worst case could lead to a war between China and the United States.

UNIDENTIFIED MALE: Taiwan is probably the most dangerous situation in East Asia at this point. This is really the only place in East Asia where I think there's a real possibility that we could see military conflict in the next couple of years if things go badly.

CHINOY (voice-over): The roots of this explosive situation date back more than half a century, when the Chinese Communists took power in Beijing but failed to capture Taiwan.

For years, both sides have lived with an uneasy status quo. China claims sovereignty over the island, but was willing to tolerate its separate existence as long as Taiwan didn't move towards formal independence.

Now, though, President Chen Shui-bien, in a close reelection fight with opposition leader Lian Jiang (ph), appears to be doing just that. While Lian (ph) has talked about reconciliation with Beijing, Chen has built his campaign around keeping Taiwan separate from China. He's asked voters to endorse a referendum authorizing a military buildup to counter Beijing's forces and he's called for a new constitution, all steps China sees as leading to the independence it has vowed to use force to prevent.

Before the 1996 presidential election here, Beijing fired missiles near Taiwan to deter pro-independence sentiment, prompting the Clinton administration to deploy aircraft carriers in the Western Pacific.

Now the signs are that Beijing is even more frustrated.

UNIDENTIFIED MALE: This way is more dangerous than 1996 and the exercises because if China decided to use force, it is not only exercises. It's not bluffing. It's not intimidation. It's a decision to use force to damage Taiwan and make Taiwan come to a negotiating table with China.

CHINOY: And the Bush administration, which is committed to defending Taiwan, could find itself dragged into a conflict it desperately wants to avoid.

UNIDENTIFIED MALE: If Chen Shui-bien is reelected and if he continues with his current course of action of wanting to consolidate what he says is Taiwan's sovereignty and independence, they could lead to, as I say, a real confrontation with China that is totally unnecessary and certainly not needed by the United States at this point.

CHINOY: The election is on Saturday. With so much at stake, opinion polls say the race is too close to call.

Mike Chinoy, CNN, Taipei.

(END VIDEOTAPE)

MANN: Joining us now about events unfolding in Taiwan is a scholar of Asian security affairs who you saw just briefly in that report a moment ago, Michael Swain of the Carnegie Endowment for International Peace.

Thanks so much for being with us.

It seems like there is an enormous amount of tension caused by the simple fact of this referendum. Why is the referendum being held?

MICHAEL SWAIN, CARNEGIE ENDOWMENT FOR PEACE: Well, the referendum is being held for a variety of reasons. I think the first reason it's being held is to try and boost Chen Shui-bien's support in the upcoming presidential election.

He is striking the theme of the confrontation with the mainland, with China and the threat that's posed by Chinese missiles against Taiwan, in order to try to increase the level of support among his more hardcore supporters within his party, who are very anti-China and very supportive of independence for Taiwan.

He's also using the referendum as a way of distracting the public to a certain extent away from the history of his last four years of rule, where there hasn't been a lot of progress to point to. In part because of the deadlock he's had with the Taiwan legislature and because of his own deficiencies in his policies.

And thirdly, he's holding the referendum as a way of setting a precedent, to lay the groundwork for moving towards what people think will be future national plebiscites, in order to advance issues of independence for Taiwan, including the idea of a new constitution.

MANN: There is always a certain amount of brinkmanship associated with these kinds of measures, but could it really lead to war? People are talking like that, and it would still seem, though, on both sides, there is just so much to lose.

SWAIN: Well, that's absolutely correct. There is an enormous amount to lose on all sides. Taiwan, China and the United States, because the United States would almost certainly be dragged into a confrontation between China and Taiwan over this.

So it's a major issue, but there is definitely a possibility of a crisis that could lead to military conflict over this, because the Chinese government's position on this is that it cannot permit Taiwan to become a full sovereign, independent nation without its consent. It regards Taiwan as being part of China and it regards the United States as having at least acknowledged that fact in the normalization between the United States and China many years ago.

And so if Taiwan moves and pushes towards a situation where the prospect of reunification really is being closed off, is no longer really possible, China either has to look to the United States to try to stop this or has to act on its own.

MANN: What's the United States been doing? What have Taiwan's neighbors been doing?

SWAIN: Well, Taiwan's neighbors are very nervous about all of this. There isn't a lot of support within the region for what is happening on Taiwan right now, particularly the actions that are being taken by Chen Shui-bien, the president of Taiwan, to push for the idea of a national referendum on mainland-related issues and to push for the idea of a new constitution that could change the very basis of sovereignty of the Taiwan state, making it much more an independent entity.

This makes a lot of countries in the region very nervous, precisely because of what I referred to a minute ago, the relationship that has with China's position and the U.S. desire to have a peaceful resolution of the problem.

MANN: In the midst of all of this, something else is going on, military maneuvers being held jointly by China and France. What is China up to? What are the French up to?

SWAIN: I think those maneuvers really are not something that is related to any sort of crisis or dangerous situation.

The French and the Chinese, both in their civilian leadership and the military, have been interacting for many years now, and this series of exercises is non-combat related exercises, sort of search and rescue, replenishment at sea type of exercises, are really regarded as kind of confidence building measures between the two countries and a way to sort of strengthen their improving diplomatic relations.

This comes on the heels of a very successful state visit that President Hu Jintao just recently paid to France. So I don't see this as a major sort of military provocation of any sort.

MANN: We have just a moment. The election is Saturday. Will this unravel quickly after that, if the vote goes one way?

SWAIN: Say again, please?

MANN: The election is Saturday. How quickly is all of this going to happen, do you think?

SWAIN: How quickly is -- well, the election we'll see on Saturday will have both the referendum and the election for the president itself. Now, based upon what happens in that election, you will see certain reactions on the part of China over time.

If Chen Shui-bien wins, and if he continues in his course of action to establish a new constitution through a national plebiscite of the people of Taiwan, I think China would be very alarmed by this and it will become increasingly pessimistic, in my view, about the prospects for eventually being able to establish some kind of accomodation, modus vivendi, whatever you want to call it, to deal with Taiwan, to move towards some kind of unification in the future. And is it becomes more and more pessimistic, China will be more and more inclined towards the option of using force, which it has said it does not want to do. But if it has no option other than the use of force, I believe the Chinese will indeed use force.

MANN: On that ominous note, Michael Swain, of the Carnegie Endowment, thanks so much.

SWAIN: You're welcome.

MANN: And that's INSIGHT. I'm Jonathan Mann.

END

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Aired March 16, 2004 - 23:00:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
JONATHAN MANN, CNN HOST (voice-over): The heat in Hong Kong. Democracy advocates are feeling a new kind of pressure from the Communist Party in Beijing.

MARGARET NG, POLITICIAN IN HONG KONG: There is a huge dosage of intimidation. You are singled out. You are stigmatized. People are told not to be too close to you.

(END VIDEO CLIP)

MANN: Hello and welcome.

Hong Kong was promised many things when it reverted to Chinese rule in 1997. One of those promises was a chance at democracy. Right now its people pick some of their lawmakers, but not all. Back in the year 2000, for example, they chose 24 of the 60 members of their legislative council. In the elections that are scheduled for September, they will choose 30, one half of the council, potentially enough to begin challenging Beijing in a new way and demanding more democracy and autonomy.

China is taking a very public approach to the democrats. It's trying to discredit them.

On our program today, one country, two systems and trouble.

CNN's Mike Chinoy had this report from Hong Kong.

(BEGIN VIDEOTAPE)

MIKE CHINOY, CNN CORRESPONDENT (voice-over): It is at its heart a Chinese city. Of its 7 million people, 98 percent are Chinese. Its habits, its rhythms are Chinese.

So too its food, its smells, its very soul. But Hong Kong is a Chinese city like no other. Created by Britons in the heyday of empire a century-and-a-half ago, filled by Chinese, many of whom were fleeing upheaval and depression in Mainland China. A crossroads of East and West, geographically and culturally attached to China but with its capitalist way of life, its political freedoms and Western-style legal system, very different from the Communist system just a few miles away.

In 1997, the Union Jack came down for the last time. Britain handed Hong Kong back to China under a formula called One Country, Two Systems, where Beijing agreed to preserve the territories liberties and way of life for 50 years.

(on camera): Following the handover, Beijing confounded the skeptics by generally keeping its hands off Hong Kong, but now in its most forceful intervention since 1997, China has branded the territories leading democracy advocates as unpatriotic and declared them unfit to hold high government office.

(voice-over): This man has been Beijing's main target, Martin Lee, lawyer, legislator and long-time head of the Hong Kong Democratic Party, which has led the fight for more representative government.

MARTIN LEE, HONG KONG DEMOCRATIC PARTY: Beijing is extremely worried that come September the democrats, small letter "d", may win the majority in the legislative council. So they are doing everything they could possibly think of to try to stop them.

CHINOY: Beijing's rhetoric and tactics have been reminiscent of old- style Communist campaigns. Opposition leaders here were denounced for trying to subvert the central government, for engaging in activities that harm China, for using democracy to fool the public.

And Lee, who testified about Hong Kong before the U.S. Senate earlier this month, was described as a traitor.

UNIDENTIFIED MALE (through translator): Why would people in Hong Kong encourage foreign countries to interfere in China's internal affairs? To do so is obviously an act of treason.

CHINOY: Opposition lawmaker Margaret NG is another one of those targeted by Beijing.

NG: There is a huge dosage of intimidation. You are singled out. You are stigmatized. People are told not to be too close to you.

CHINOY: China's tough new line appears to be a response to huge protests last summer. That's when Hong Kong's highly unpopular Chief Executive Tung Chee Hwa, who was appointed by Beijing, tried to introduce Draconian anti-subversion legislation.

Hundreds of thousands took to the streets to oppose the bill and demand the right to choose their own leaders.

Under Hong Kong's post-colonial constitution, the basic law, citizens are promised universal suffrage and the right to freely elect the legislature and the chief executive as early as 2007. But it's becoming clear that Beijing's definition of elections is that it should control the outcome.

UNIDENTIFIED MALE (through translator): Patriots must form the main body of those who participate in the governing of Hong Kong.

CHINOY: In this glittering, sophisticated city, China's muscle- flexing has sparked not just anxiety, but an intense debate about what it means to be patriotic, and many, including young people like Boy Bo Yip (ph) and Chan King Fi (ph), don't accept the view that being patriotic means kowtowing to the Chinese Communist Party.

UNIDENTIFIED MALE (through translator): The Beijing regime does not have democratic elections, so any people who want to democratically elect their own government are going to come into conflict with it.

UNIDENTIFIED FEMALE (through translator): Patriotism is just a name, a word dividing people, us and them. Beijing people are patriotic or unpatriotic. It's not a real basis for judgment. It's like how the Communists used to label people leftists and rightists.

UNIDENTIFIED MALE (through translator): Frankly, this whole patriotism thing is a pretty Aryan concept for us. I live in Hong Kong. I read Hong Kong papers and magazines. I'm interested in Hong Kong celebrities. For most people like us, patriotism is a very distant thing.

CHINOY: Indeed, until recently fragmentism rather than patriotism has defined Hong Kong, especially its remarkably successful business community.

When the British were in charge, many were happy to have the label "Sir" in front of their names. Now with China clearly calling the shots, many tycoons have endorsed Beijing's faux patriotism, anti-universal suffrage campaign. Among them, American-educated construction magnate Sir Gordon Wu.

SIR GORDON WU, BUSINESSMAN; You see the danger is that (UNINTELLIGIBLE) the majority. There are people (UNINTELLIGIBLE) and then once they recognize there is a majority, then they do all sorts of terrible things.

CHINOY: In a city known not just for its China trade but as a regional financial center, the patriotism movement has left many foreign businesspeople uneasy.

UNIDENTIFIED FEMALE: Since the handover in '97, I think most people have noticed that Beijing has been prudent and careful and some people would use the phrase hands-off when dealing with Hong Kong. And now what we're seeing is something quite different.

CHINOY: Steven Vines (ph) is a political analyst who's lived in Hong Kong for nearly 20 years.

STEVEN VINES (ph), POLITICAL ANALYST: I think you'll find Hong Kong as an international financial center, will have its very foundations cut away from it, and that's very serious.

CHINOY: The irony is that the vast majority of Hong Kong people, including many who took to the streets last year, are not anti-China.

NG: In fact, Hong Kong is a singularly patriotic community in the sense that there is a strong identification with the Chinese heritage, even with the Chinese nation, even if they don't agree with the Communist Party or the form of government.

CHINOY: Indeed, when China's first astronaut visited the territory after his successful flight last fall, he was mobbed by well-wishers. The crowds that flock to the annual Open House at the Chinese Army Garrison here are uniformly friendly.

But now Beijing's campaign has opened divisions so sharp that pro and anti-democracy activists scuffled when Martin Lee returned from his controversial visit to Washington.

LEE: It reminds people of the bad old days, of the cultural revolution. And Hong Kong people don't like it a bit. But, of course, some people are frightened, absolutely frightened.

CHINOY: But many, including those who previously viewed the Chinese government in a more positive light, are taking a different view.

UNIDENTIFIED MALE (through translator): These threatening statements from China are really going to make people more likely to vote for democratic candidates.

CHINOY: And that could mean China's patriotism drive could produce precisely the result Beijing is trying in such a heavy-handed way to prevent.

Mike Chinoy, CNN, Hong Kong.

(END VIDEOTAPE)

MANN: We take a break now. When we come back, a basic law and things get complicated.

Stay with us.

(COMMERCIAL BREAK)

MANN: Hong Kong Chief Executive Tung Chee Hwa was not elected to his office and if the people he governs had a chance to vote, he wouldn't be. A Hong Kong University poll last month found that only 13 percent of local residents approve of his leadership. Tung's second term in office expires in 2007. After that, democracy advocates want to gain the right to vote in his successor

Welcome back.

Hong Kong's constitution, the basic law, describes full democracy as its ultimate aim, but it doesn't actually provide for it. Activists are trying to rally public opinion to win election rights that aren't now laid down in law, and as we've been seeing, Beijing is pressing back.

A short while ago we got in touch with Michael DeGolyer of the Hong Kong Transition Project, a scholarly organization that studies the territory.

(BEGIN VIDEOTAPE)

MICHAEL DEGOLYER, HONG KONG TRANSITION PROJECT: I think it's very serious, for two reasons.

No. 1 is that what they're talking about is not just names. What they're talking about are what they call principles, and those principles are a particular interpretation of the One Country, Two Systems slogan, which they're applying to the interpretation of the basic law, rather than a common law approach to the basic law.

And when you take their interpretation of One Country, Two Systems, basically they're saying the Chinese constitution says the Communist Party has a leading role, has a deciding role, has the determining role. It legislates and interprets the law -- the Communist Party does. The Communist Party is the sovereign of China. Hong Kong is an inalienable part of China. Therefore, the Communist Party, in essence, can make all the decisions about anything having to do with the basic law and particularly in this case whether or not we go to direct elections for the chief executive and for the legislative council in 2007 and 2008, respectively.

MANN: Why is this happening now? Is it because of the election calendar in Hong Kong? Is it because of something happening behind the scenes in Beijing? Or as you seem to be suggesting, is it the kind of thing that was inevitable given the overlap of one political culture on top of another?

DEGOLYER: I think it's a bit of all of that. It's particularly driven by the calendar because of the very shortly upcoming Taiwan election. You might have discussed that -- I'm sure you have.

In the case of the Taiwan election, you have two presidential candidates, one of whom leans towards some sort of accomodation with the Chinese government, the central government, some sort of reunification under certain principles, which seem to be moving at this point. The other candidate very clearly stands out for the independence of Taiwan and the total separation, the separate identity of Taiwan from Mainland China.

And so that election is really driving I think a lot of the anxiety and concern, particularly among the conservatives in Beijing. You might know that the conservatives in Beijing are led by former President Jiang Zemin, who is now the chair of the Central Military Commission. There are a number of other officials who are within that what used to be called Shanghai Faction. And they are particularly concerned about the relationship with Taiwan. That's kind of what Jiang Zemin wanted to cap his career with achieving, and that is certainly endangered.

The other reason why they're very upset about this right at the moment is that the legislative council election in Hong Kong takes place in September, and for the first time it looks like there is a very real possibility that even with only half the seats directly elected and the other half indirectly elected, that the so-called pro-democracy groups here will actually gain a majority in the legislative council and, with that, a great deal of influence, and that's also why they're being attacked right now.

MANN: Is this kind of campaign likely to work? Are the people in Hong Kong likely to respond the way Beijing hopes?

DEGOLYER: Well, they've tried this before, twice, in the case of Taiwan, and it didn't work either time there, and it looks like it's failing again.

Hong Kong voters also had this tried on them, for example, back in 1995, and it didn't work then. In fact, under the last election under the British, there were more directly or in effect directly -- in other words, they had much larger electoral bodies for the indirectly elected seats. In some cases 200,000 voters. Nowadays it's down to maybe 100 to 200 or at most 2,000 or 3,000 voters in those seats.

And the democrats at that point won a majority. So I think, you know, they're basically very concerned about this, and they're trying everything possible. And like I say, it's also the conservative faction, I think, that's even most concerned about Hong Kong.

MANN: Michael DeGolyer, of the Hong Kong Transition Project, thank you so much for talking with us.

(END VIDEOTAPE)

We take another break and then we pick up on the example that we just heard about, Taiwan. A similar conflict with Beijing that could turn much more serious.

Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MANN (voice-over): The vote in Hong Kong is still months away, but Beijing is watching with frustration as another election approaches, this one in just days and potentially much more dangerous. It's in Taiwan.

UNIDENTIFIED MALE: We are saying no to China, yes to Taiwan.

(END VIDEO CLIP)

MANN: Welcome back.

Beijing regards both Hong Kong and Taiwan as essential parts of China itself. The people of Hong Kong never contested that status and never contemplated conflict over it.

In Taiwan, though, a combined election and referendum on Saturday are raising both possibilities.

CNN's Mike Chinoy has this report now from Taipei.

(BEGIN VIDEOTAPE)

CHINOY (voice-over): The campaign trail, Taiwan style. On this island just 100 miles from Mainland China, a celebration of democracy and a political drama that's reverberating in capitals as far away as Beijing and Washington.

(on camera): In fact, diplomats, political analysts and security specialists say the outcome here could provoke a major new international crisis, one that in the worst case could lead to a war between China and the United States.

UNIDENTIFIED MALE: Taiwan is probably the most dangerous situation in East Asia at this point. This is really the only place in East Asia where I think there's a real possibility that we could see military conflict in the next couple of years if things go badly.

CHINOY (voice-over): The roots of this explosive situation date back more than half a century, when the Chinese Communists took power in Beijing but failed to capture Taiwan.

For years, both sides have lived with an uneasy status quo. China claims sovereignty over the island, but was willing to tolerate its separate existence as long as Taiwan didn't move towards formal independence.

Now, though, President Chen Shui-bien, in a close reelection fight with opposition leader Lian Jiang (ph), appears to be doing just that. While Lian (ph) has talked about reconciliation with Beijing, Chen has built his campaign around keeping Taiwan separate from China. He's asked voters to endorse a referendum authorizing a military buildup to counter Beijing's forces and he's called for a new constitution, all steps China sees as leading to the independence it has vowed to use force to prevent.

Before the 1996 presidential election here, Beijing fired missiles near Taiwan to deter pro-independence sentiment, prompting the Clinton administration to deploy aircraft carriers in the Western Pacific.

Now the signs are that Beijing is even more frustrated.

UNIDENTIFIED MALE: This way is more dangerous than 1996 and the exercises because if China decided to use force, it is not only exercises. It's not bluffing. It's not intimidation. It's a decision to use force to damage Taiwan and make Taiwan come to a negotiating table with China.

CHINOY: And the Bush administration, which is committed to defending Taiwan, could find itself dragged into a conflict it desperately wants to avoid.

UNIDENTIFIED MALE: If Chen Shui-bien is reelected and if he continues with his current course of action of wanting to consolidate what he says is Taiwan's sovereignty and independence, they could lead to, as I say, a real confrontation with China that is totally unnecessary and certainly not needed by the United States at this point.

CHINOY: The election is on Saturday. With so much at stake, opinion polls say the race is too close to call.

Mike Chinoy, CNN, Taipei.

(END VIDEOTAPE)

MANN: Joining us now about events unfolding in Taiwan is a scholar of Asian security affairs who you saw just briefly in that report a moment ago, Michael Swain of the Carnegie Endowment for International Peace.

Thanks so much for being with us.

It seems like there is an enormous amount of tension caused by the simple fact of this referendum. Why is the referendum being held?

MICHAEL SWAIN, CARNEGIE ENDOWMENT FOR PEACE: Well, the referendum is being held for a variety of reasons. I think the first reason it's being held is to try and boost Chen Shui-bien's support in the upcoming presidential election.

He is striking the theme of the confrontation with the mainland, with China and the threat that's posed by Chinese missiles against Taiwan, in order to try to increase the level of support among his more hardcore supporters within his party, who are very anti-China and very supportive of independence for Taiwan.

He's also using the referendum as a way of distracting the public to a certain extent away from the history of his last four years of rule, where there hasn't been a lot of progress to point to. In part because of the deadlock he's had with the Taiwan legislature and because of his own deficiencies in his policies.

And thirdly, he's holding the referendum as a way of setting a precedent, to lay the groundwork for moving towards what people think will be future national plebiscites, in order to advance issues of independence for Taiwan, including the idea of a new constitution.

MANN: There is always a certain amount of brinkmanship associated with these kinds of measures, but could it really lead to war? People are talking like that, and it would still seem, though, on both sides, there is just so much to lose.

SWAIN: Well, that's absolutely correct. There is an enormous amount to lose on all sides. Taiwan, China and the United States, because the United States would almost certainly be dragged into a confrontation between China and Taiwan over this.

So it's a major issue, but there is definitely a possibility of a crisis that could lead to military conflict over this, because the Chinese government's position on this is that it cannot permit Taiwan to become a full sovereign, independent nation without its consent. It regards Taiwan as being part of China and it regards the United States as having at least acknowledged that fact in the normalization between the United States and China many years ago.

And so if Taiwan moves and pushes towards a situation where the prospect of reunification really is being closed off, is no longer really possible, China either has to look to the United States to try to stop this or has to act on its own.

MANN: What's the United States been doing? What have Taiwan's neighbors been doing?

SWAIN: Well, Taiwan's neighbors are very nervous about all of this. There isn't a lot of support within the region for what is happening on Taiwan right now, particularly the actions that are being taken by Chen Shui-bien, the president of Taiwan, to push for the idea of a national referendum on mainland-related issues and to push for the idea of a new constitution that could change the very basis of sovereignty of the Taiwan state, making it much more an independent entity.

This makes a lot of countries in the region very nervous, precisely because of what I referred to a minute ago, the relationship that has with China's position and the U.S. desire to have a peaceful resolution of the problem.

MANN: In the midst of all of this, something else is going on, military maneuvers being held jointly by China and France. What is China up to? What are the French up to?

SWAIN: I think those maneuvers really are not something that is related to any sort of crisis or dangerous situation.

The French and the Chinese, both in their civilian leadership and the military, have been interacting for many years now, and this series of exercises is non-combat related exercises, sort of search and rescue, replenishment at sea type of exercises, are really regarded as kind of confidence building measures between the two countries and a way to sort of strengthen their improving diplomatic relations.

This comes on the heels of a very successful state visit that President Hu Jintao just recently paid to France. So I don't see this as a major sort of military provocation of any sort.

MANN: We have just a moment. The election is Saturday. Will this unravel quickly after that, if the vote goes one way?

SWAIN: Say again, please?

MANN: The election is Saturday. How quickly is all of this going to happen, do you think?

SWAIN: How quickly is -- well, the election we'll see on Saturday will have both the referendum and the election for the president itself. Now, based upon what happens in that election, you will see certain reactions on the part of China over time.

If Chen Shui-bien wins, and if he continues in his course of action to establish a new constitution through a national plebiscite of the people of Taiwan, I think China would be very alarmed by this and it will become increasingly pessimistic, in my view, about the prospects for eventually being able to establish some kind of accomodation, modus vivendi, whatever you want to call it, to deal with Taiwan, to move towards some kind of unification in the future. And is it becomes more and more pessimistic, China will be more and more inclined towards the option of using force, which it has said it does not want to do. But if it has no option other than the use of force, I believe the Chinese will indeed use force.

MANN: On that ominous note, Michael Swain, of the Carnegie Endowment, thanks so much.

SWAIN: You're welcome.

MANN: And that's INSIGHT. I'm Jonathan Mann.

END

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