Taiwan's wealth (where does it come from?)

Agree with this very much. I use the high speed (bullet train) weekly its great, clean and on time to the minute. (Like Japan and China and German trains, French ones are nice TGV but well sometimes not working from industrial actions) Also in Kaoshiung new bus, new ubike, goku city scooter ect (NT$10 a ride for short hops) and the underground lines (KMRT) ontime and clean.

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These huge infrastructure projects (HSR, KMRT) have been built by imported migrant labour. In Kaohsiung’s case, conditions were so bad that the Thai workers rioted.

These low-cost (and often brutal) labour conditions are not politically possible in most countries in the West.

Guy

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Yes the average worker is good but the management on top is terrible and overall creates poorer results and less efficient. Ive worked in Taipei 8 yrs and US 30 in tech and design, my impression is white collar job Americans are more efficient and productive (due to better management and results oriented structure, better benefits + work life balance). In Taiwan Managers waste time on non productive meetings and much of it is the supervisor or VP’s entertaining themselves to hear themselves talk. Its a culture of hierarchy and looking to be working hard vs actually getting things done. The white collar workers can be more productive in Taiwan but the work culture here curbs this.

Blue collar Taiwan is the opposite including Family Mart employees etc are more efficient or harder working than US (due to better work ethics for lower paid employees). These are generalizations but I find it generally true. However for most chains such as Starbucks the employees would be the same in different countries in work ethics.

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From the virus crisis you can see how effective Taiwan is compared to the rest of the world

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Effective In regards to Taiwan Govts proactive approach to handle the coronavirus and the culture of people wearing masks yes…the world can learn a lot from Taiwan in this case

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In the US they could have used illegal aliens by giving them guest workers visas. So many Mexicans and S/Central Americans are willing to cross the border there would be no shortage of workers.

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There was it was called the Bracero Program from 1942 to 1964.

In 1942, the United States government created Bracero guest worker visa program to allow Mexican farm workers to temporarily work for American farmers during World War II.[i] The government entered into a bilateral labor agreement with Mexico that regulated the migrant’s wages, duration of employment, age of workers, health care, and transportation from Mexico to U.S. farms.[ii] Transportation to the farm, housing, and meals were sold by the employers for a low price.[iii] Ten percent of the migrant’s wages were deducted from their paychecks and deposited in an account that would be turned over to them once they returned to Mexico.[iv]
https://www.cato.org/blog/enforcement-didnt-end-unlawful-immigration-1950s-more-visas-did

The November 1960 CBS documentary “Harvest of Shame” convinced Kennedy that Braceros were “adversely affecting the wages, working conditions, and employment opportunities of our own agricultural workers.” Farmers fought to preserve the program in Congress, but lost, and the Bracero program ended December 31, 1964.

Yes, I was also disappointed about how Japan handled the virus.

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Taiwan doesn’t store world’s highest gold reserves. Who told you that? America stores the word’s highst gold reserves.

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Top 20 according to World Gold Council’s latest rankings (as of July 2020)[10][11] Rank Country/Organization Gold holdings
(in metric tons) Gold’s share of
forex reserves
1 \ 23x12 United States 8,133.5 78.9%
2 \ 23x14 Germany 3,363.6 75.2%
International Monetary Fund 2,814.0 N/A
3 \ 23x15 Italy 2,451.8 70.8%
4 \ 23x15 France 2,436.0 65.0%
5 \ 23x15 Russia 2,299.2 22.6%
6 \ 23x15 China 1,948.3 3.4%
7 \ 16x16 Switzerland 1,040.0 6.5%
8 \ 23x15 Japan 765.2 3.1%
9 \ 23x15 India 654.9 7.5%
10 \ 23x15 Netherlands 612.5 70.9%
11 \ 23x15 Turkey 560.8 36.4%
Logo European Central Bank.svg\ 22x18 European Central Bank 504.8 31.0%
12 \ 23x15 Taiwan 422.4 4.6%
13 \ 23x15 Portugal 382.5 77.4%
14 \ 23x12 Kazakhstan 377.1 68.4%
15 \ 23x12 Uzbekistan 342.8 59.5%
16 \ 23x15 Saudi Arabia 323.1 3.5%
17 \ 23x12 United Kingdom 310.3 9.9%
18 \ 23x15 Lebanon 286.8 31.1%
19 \ 23x15 Spain 281.6 20.4%
20 \ 23x15 Austria 280.0 57.9%

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You seem to be implying that the government expenditure is huge in Taiwan but that is far from the case. Taiwan’s government expenditure is very low. The government expenditure is the same as Greece and Portugal but Taiwan’s economy size is 2.5-3 times larger and population is twice as large. It’s fiscally very conservative.

Now if you are talking about average folk’s wealth then you might have a point. The vast majority of households are in decent shape financially (aka owns at least a property + a decent-sized/huge bank account), throw in the fact that many are business owners the average net worth would be pretty high.

Personal income taxes can be MUCH higher actually… depends on your tax bracket. Might be lower at lower income brackets but I know from experience that they are MUCH higher in Taiwan (vs USA) at the top bracket. I also need to file a US tax return… though the amount paid is usually minimal, just on US investment income and a handful of working days in the US. If I didn’t have any investment income and never had business trips to the US, I would’ve paid zero.

Taiwan’s top tax rate is 40% which applies once you hit ~NT$4.5m (call it US$150k). In the US, married filing jointly its 22% at that income… if you go back to pre-Trump tax cut it was 25%. That’s a pretty big difference…

I mentioned this to a friend a while back and he looked at me in shock… his first question was “what do they spend the money on?”

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I agree with most of what you said but I’m not sure about this part. I find the school infrastructure and also facilities fairly basic. For instance few schools in Taiwan have swimming pools and most don’t have air-conditioning . And there was no real public kindergarten until recently and it’s still limited. I think Taiwan should spend way more on first and second level education including recruiting better teachers. The teacher student ratio isn’t terrible at average 26 or so but it would be better to reduce it as that is a key factor regardless of quality of education .

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It is 900+ billion dollars spent in 2018 should be more now. A lot of waste and could be spent better it seems as Air Con is needed.

I think the issue is that, overall, salaries are much lower, so few people are hitting the 40% level.

Additionally, I think a lot of “fiddling” happens. Business owners likely don’t pay themselves higher salaries, but take money out in other ways. E.G. by getting the company to pay their daily expenses.

Whenever you see people giving the 統編號碼 (company number) when they are paying for something, it means they are claiming that receipt through their company, thus reducing the profits and therefore the corporate taxes due. And you see people using it everywhere…at the supermarket, buying cinema tickets, eating out at restaurants etc etc, mostly things which have nothing to do with running a business. It’s so common, that just about every shop or service you use will ask if you want to use the company number on the receipt.

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A few years back I asked somebody in the MoE why they didn’t reduce the ratio. He pointed out the ratio was reducing itself.

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It’s true in country areas but not so much in popular schools.
Focusing on early stage education brings big wins later on. They don’t go a great job of it , the holes in the public system sticky plastered with buxibans. The school environments should be improved some look and are terrible ( I know I had a part time job for a while visiting schools). New schools are pretty decent even on the countryside , old schools.,.even famous ones can look like prisons.
I’m not joking some of them look like jails for kids. :neutral_face:

Totally agree with all of your points

The taxation system here really discourages “corporate employment” (at least the type we see in the West where a decent wage is a possibility) and encourages small businesses.

Don’t think that’s necessarily inherently bad, every country has a right to build a system that they see fit. But I think that the consequences are that few Taiwanese firms are competitive internationally (obviously excluding TSMC and other semiconductor firms)

What I find sort of ironic re: importance of education. It’s of course important in and of itself… but the educational system, with a lack of good employment opportunities, becomes sort of useless from a more practical perspective. The education system doesn’t really teach you how to be an entrepreneur, which is the most likely path to wealth here

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I see a lot of points above confusing spending quantity with outcome quality…education as an example.

But perhaps people underestimate the international investment by Taiwanese. Both legal and not. There is a massive amount of Taiwanese abroad shaking things up for themselves. In all sorts of industries. Government isnt shy about cooperating with them either. Makes total sense Taiwan is pretty rich given that and how tiny and easyit is, logistically, to manage said small land mass. Given the wealth and land mass, one would think the infrastructure should be far better. roads, trains, post etc all are pretty great. But other areas fail horribly such as water and food security. How many wealthy civilations collapsed due to water issues?

Wait for iiiiiit.

No, really. Just wait for it haha.