Contrary to what people tend to think and the way current diplomacy still defines the situation, I argue that Taiwan may very well be the first “transnational nation.” Few recognized its international presence, until it became a major exporter to the world economy, a change of status and policy that was really the consequence of its expulsion from the United Nations (following diplomatic recognition of the PRC). Its subsequent attempts to jockey for admission into the United Nations can largely be seen as a strategy to build upon its newly established role as a world economic player. One significant feature of transnational capitalism is reflected in Taiwan’s success, which demonstrates that the official status of nation was not important or relevant to its development in economic and other terms. Thus, in this era of transnational flows, one might say, national identity, cultural consciousness, and territorial boundedness are clearly secondary. In some senses, this seems to be true, but this is overly simplistic. The end of organized capitalism, as advocated by Lash and Urry (1987), has led many to believe that the free flow of transnational capital has broken down national barriers in respect to all other kinds of flows, but in fact, transnational flows of people have been regulated by and subject to other kinds of forces, political as well as cultural in nature, that have disrupted emerging forms of cosmopolitanism and even threaten to expose deeper conservative if not reactionary biases in the constitution of traditional society. 1 In Taiwan, the growing emergence of transnational cosmopolitanism, runs parallel with the increasing rhetorical importance of multiculturalism. However, the latter is the product more precisely of a wave of cultural ‘indigenization.’ At a deeper level, both (cosmopolitan) ‘transnationalism’ and (indigenous) ‘multiculturalism’ are, in my opinion, largely incompatible and mask an imminent future crisis.