With his second inauguration looming, President Bush has his hands full in the Middle East and with ambitious plans for domestic reform during his second term. In this context, Beijing's recently announced plans for anti-secession legislation is particularly unwelcome.

The content of the anticipated legislation remains uncertain, and its motivation and timing are puzzling. According to letters sent by the Chinese Embassy in Washington to key members of Congress, it is intended to "give full expression to the strong resolve of the Chinese people of never allowing the 'Taiwan independence' forces to cut off Taiwan from the rest of China under any name or by any means." Or as a pro-Beijing daily in Hong Kong put it, "It will leave 'Taiwan independence' forces with no room for ambiguity to exploit."

This suggests that the legislation's main aim will be further to deter President Chen Shui-bian's salami-slicing separatist tactics. An additional motivation may be to further energize U.S. efforts to restrain Chen in order to head off a future crisis. And, to be sure, the new legislative initiative may be attributable to internal political forces.

But why now, within weeks of President Chen's setback in the Dec. 11 legislative elections? One can only guess.

Perhaps Beijing chalked up the Democratic Progressive Party's difficulties in the elections to their own martial rhetoric, and decided to pile on new forms of political pressure. Perhaps it has concluded that despite the election results, Chen will still move aggressively on his stated intention to revise Taiwan's constitution -- thus moving a step closer to independence -- before the conclusion of his term in 2008. Perhaps it deduced from the pointed warnings directed at Chen by senior U.S. officials during the recent Taiwanese elections that Washington will now tolerate blunter threats to reinforce the People's Republic of China's "red lines."

Whatever the suppositions behind Beijing's plan for anti-secessionist legislation, they probably underestimate the substantial risks involved. Such legislation will doubtless alienate many Taiwanese voters, perhaps contributing inadvertently to the evolution of a growing sense of Taiwan's separate political identity, and producing wider legislative support in Taipei for major arms purchases from the United States.

It could also set off an action/reaction cycle with Taiwan that would undermine any possibility of reviving a serious cross-Straits dialogue. While Beijing's planned legislation may be its "response" to Chen's frequent references to constitutional referenda, it is as likely to encourage such referenda as obstruct them. It will upset many Americans, and it will galvanize the Taiwan lobby in America to stir up unhelpful resolutions in Congress when it reconvenes.

The greatest risk, perhaps, is that this could exacerbate the dangerous remilitarization of the Taiwan issue that has emerged since 1995, marked by explicit People's Liberation Army deployments and training aimed at Taiwan contingencies on the one hand, and escalating U.S. arms sales to Taiwan, combined with closer cooperation between the United States and Taiwan's defense establishment, on the other.

To a disturbing degree, this process seems driven less by policy considerations than by the parochial interests of the PLA for enhanced equipment and budgets, and by the attractiveness of the lucrative Taiwan arms market for U.S. military suppliers. Not surprisingly, this evolution is convincing pessimists on each side that confrontation is simply a question of time, despite the disaster it would represent for all parties.

Stabilizing this situation will demand the Bush administration's attention, despite other urgent preoccupations. Stability in the Straits, moreover, is an achievable goal if good sense prevails on all sides. Realistic leaders in Beijing recognize that there is no short-term solution.

With Taiwan in full control of its domestic circumstances, no country whose support is necessary for its independence to be meaningful views such independence as worth the cost of conflict with Beijing. The growing economic interdependence between China and Taiwan also raises the ante of any such conflict for them both.

To be viable, a stabilization arrangement cannot negate the "one China" principle, but it should leave open the parameters of an eventual settlement. Its goal should be an end to explicit PRC threats to use force against Taiwan and of overt preparations for military contingencies in the Strait, supplemented by reduced missile deployments opposite Taiwan; reduced U.S. military sales to Taipei consistent with the lowered threat level; more international "space" for Taiwan in exchange for an indefinite halt to actions aimed at enhancing Taiwan's international position; augmented links across the Taiwan Strait; and cross-strait talks aimed at addressing immediate problems and encouraging the growth of greater mutual confidence.

At a moment when we are entering a new year, let us hope that progress toward stabilization can be achieved.

Below are excerpts from the Straits Times piece. The piece is not reprinted in its entirety due to copyright reasons. Please visit the link below below to read the whole article. "...Said Indonesia specialist Donald K. Emmerson at the Institute for International Studies at California's Stanford University: 'My sense is that the election will be primarily about crime, stability, prices, not about religious issues.' Many Indonesia watchers in the U.S. have been surprised that Islam has not appeared to be a dominant factor in the campaign. Said Dr Emmerson: 'It's quite remarkable that in the Malaysian election religion was very important with respect to the PAS factor, but in Indonesia that is just not the case. And that is a huge relief to the US as it seeks to win the hearts and minds of moderate Muslims in the war against terrorism. ..."

With the next round of presidential primary elections coming up Tuesday, billboards are popping up across South Carolina with a political message that might resonate with any Democratic contender: "Lost your job to free trade and offshoring yet?"

The issue of employment is high on the agenda in this political season. President Bush can take credit for an economic recovery, but he is vulnerable when it comes to jobs. The stock market is up, but job growth is dismal -- only 1,000 jobs were created in December, a fraction of the 300,000 new jobs the Bush administration projected.

As the temperature rises over disappointing job growth, the practice of "offshoring" -- sending jobs overseas to cheap labor markets -- has worked its way into the rhetoric of the presidential campaign trail.

Sen. John Kerry of Massachusetts, the Democratic front-runner after victories in Iowa and New Hampshire, has been denouncing the Bush administration for rewarding "Benedict Arnold CEOs" who move "profits and jobs overseas." Howard Dean, the populist former governor of Vermont, has told his audiences that America needs a president "who doesn't think that big corporations who get tax cuts ought to be able to move their headquarters to Bermuda and their jobs offshore."

Significance unknown

There's no consensus among economists and experts over the long-term significance of the trend toward offshoring, jargon that combines the words "offshore" and "outsourcing." It generally refers to the export of white-collar jobs in information technology and other professional fields such as accounting and banking services.

But blue-collar workers have borne the brunt of the pain. South Carolina, a key battleground state for the Democrats, has been hit hard by overseas outsourcing in the textile industry, and has lost about 64,000 manufacturing jobs over the past three years, according to the American Manufacturing Trade Action Coalition, the Washington-based lobbying group that paid for the billboard ads.

Offshoring statistics are fuzzy at best. One report estimates that 300,000 of the 2.4 million jobs lost since the beginning of the recession in 2001 can be attributed to offshoring. Future projections are all over the map: One predicts 3.3 million service-sector jobs will go overseas in the next 15 years, while a University of California-Berkeley report estimated 14 million U.S. service jobs are at risk.

"I think the issue is going to be exaggerated and manipulated by both sides in the political debate," said Dean Davison, an analyst at the Meta Group, a technology research and advisory firm in Stamford, Conn. "There are distinct differences of opinion in what corporations should do to take responsibility, and what kind of public policy should be implemented."

Legislation has been introduced in Congress to address the issue, some of it intended to stir up debate rather than win passage. Kerry introduced a bill in November that would require call-center operators to disclose their physical location to consumers who phone in for customer service or technical help, ostensibly to discourage U.S. companies from moving such jobs overseas.

On the other end of the ideological spectrum, Sen. Craig Thomas, R-Wyo., won passage for his amendment to the Senate's omnibus appropriations bill last week that bans some federal contracts to vendors using offshore labor. News of this caused a furor over the weekend in the New Delhi press, on the assumption the lucrative Indian industry in back-office contracting operations was threatened by congressional sanctions. But that was a false alarm.

Few firms affected

The ban applies only to a relatively small number of U.S. companies bidding for contracts under a Bush administration program to privatize certain federal government services, such as architectural design work, explained John Palatiello, a Washington-based lobbyist representing domestic companies bidding for privatization contracts. The strategy, he said, was to prevent federal unions from claiming their jobs were being sent overseas.

"The motivation wasn't to stop offshoring per se," Palatiello said, "but rather to get it out of the debate on privatizing federal services."

Antipathy to offshoring has deep political roots. Manufacturers in the toy and apparel industries have gone overseas for decades to produce their goods from contractors using cheap labor. Gradually, electronics makers and Silicon Valley's computer brands all followed -- and more recently software and professional services.

Presidential wannabe Ross Perot immortalized this inexorable force of globalization as the "giant sucking sound" from Mexico when he campaigned against the North American Free Trade Agreement in the 1992 election. Twelve years later, many of those Mexican manufacturing jobs have moved to China.

The fuss over job loss in this presidential election year is of particular concern in India, the nation that is benefiting most from the offshoring boom. A Jan. 19 article in the Times of India, headlined "Why is the U.S. running scared?" captured the dismay: "The issue has become a political hot potato. It has even entered the presidential debate, with Democrat Howard Dean attacking his rival contender Wesley Clark for being soft on it. Why the big hoopla over outsourcing?"

Rafiq Dossani, a consulting professor at Stanford University's Asia-Pacific Research Center, published a study of companies moving operations to India last year. He is a proponent of the business efficiencies of offshore labor markets. But even he is concerned about the long-term political consequences.

"This may be a problem in the minds of some politicians now, even before there's been sufficient analysis of what is going on," said Dossani, a New Delhi native. "But I think over the next five years this is going to have a huge impact. The range of jobs that can be offshored is mind-boggling."