[EDITORIALS]With the best of intentionsUnder the banner of "checking on living standards," the government's intervention in the market is becoming more frequent and stronger. Government policy is no doubt fundamentally intended to make the lives of the people better. But recent measures on such issues raise concern that the government is taking matters too much into its own hands and is too quick to dip into the taxpayers' pockets to solve problems.
The measures presented after Wednesday's cabinet meeting are a good case in point. The meeting was called to follow up on one of the president's top four priorities mentioned at his news conference on Monday － ensuring the standard of living for the middle class and blue-collar people. Measures announced Wednesday were focused on stabilizing housing prices and inflation, in addition to enhancing welfare and relieving youth unemployment.
To contain inflation under 4 percent this year, the government will minimize increases in public utility prices. It will also increase the stockpile of agricultural goods, energy and raw materials to ensure an adequate supply. Markets will be monitored to squelch any market sentiment that could fuel inflationary behavior.
In response to recent increases in housing prices centered in southern Seoul, Seoul announced plans for construction of 300,000 units of new housing in the first half of the year, including 260,000 private units for sale or lease and 40,000 new public rental units. The number of recipients of minimum living allowances and the size of those allowances will be increased, and 40 percent of the national budget will be released in the first quarter in part to help reduce youth unemployment.
These measures are positive in their practical response to problems that have emerged since the second half of last year. Ensuring the supply of raw materials, energy and housing is perhaps the orthodox strategy in tackling the problem of price increases.
But what stands out in Wednesday's announced measures is that the government appears determined to resort to administrative policing rather than orthodox economic strategy. Local governments, for example, were told to conduct field inspections to make sure that service costs within their jurisdictions are not raised. They will each be given a quota to check up on. This approach to public policy is an outdated concept of questionable effectiveness.
University and school board presidents will be called to meetings and told why they should not raise tuition. Fees charged for extracurricular classes will also be monitored to discourage increases.
Setting up task forces to monitor real estate prices and curb overheating in the housing market is all too familiar. Price monitoring and tax audits are the kind of measures we have seen time and time again since the 1970s.
We realize that the government is in a difficult position. It has to respond to problems that keep springing up and its options are limited. But hasty measures that resort to administrative controls rather than market principles will eventually distort the market and cause further problems for the economy. We surely have learned that much in the past few decades of fast-paced development.
The government has itself proclaimed principle and fundamentals to be the most important aspects of economic policy. It is time that the government stop any more economic initiatives for the people's livelihood that remind us too much of past administrations.