20 Pages

Discussion Session II

James Lilley: I think a little history will help with this one. As you will recall, in 1971, Henry Kissinger went to the People's Republic of China (PRC), where he met Chou En-Iai for the first time. Chou En-Iai, although the Russians had got us there because of the Soviet threat, playing from a weak hand but being a superb gambIer, immediately raised the question of Taiwan. He said, "We aren't going to talk about anything until we clear the air on this one." He made his point. For the next eighteen or nineteen years, Taiwan was an obstacle in the United States-PRC relationship. The Chinese had got the initiative and held it. We changed that in 1990, but still there is a tendency to go back in that direction. I would say one thing more. I am not an intellectual; I am the one who makes the deals and works in a business that is not very clean, as you say, with the short strokes. I will give you a little ofthat flavor in the presentation today.