[OUTLOOK]Gambling with a nation's future

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[OUTLOOK]Gambling with a nation's future

I hope that voicing the following thoughts does not make me a pariah here. During the World Cup, I made three bets on matches the Korean team played; I bet that Italy, Spain and Germany would beat Korea.

A friend who is studying business said that my action was a typical act of risk aversion. But I did not make such an unpatriotic decision after thoroughly examining the ability and past performance of the teams. I made the bets because I thought I wouldn't lose much, whatever happened. I wouldn't miss the 10,000 won ($8) I would lose if Korea won the match. If Korea lost, then I could drink soju with the money I had won to console my disappointment.

But my daydream of playing a double game was punctured by my friend's remark. "Hey," he said, "everybody out there is thinking just like you! If you want to make money, you should bet on the underdog!" I lost the bets on Italy and Spain and won the bet on Germany, but my winnings were not enough to buy even one drink, because I had to split the pot with other winners.

Portfolio management is one method of using risk aversion. It means allocating assets among bank accounts, corporate shares, bonds and real estate. If share prices drop, the loss can be compensated by the interest from the bonds. When interest rates drop, the loss can be recovered by rising real estate values.

These asset management methods devised by cautious economists are not exciting at all. They lack the rush of betting the world for a big payday. But on second thought, in a gamble that involves the fate of the entire world, it is better to divide the dangers among as many places as possible. For instance, the admonition "Give me liberty or give me death" may be good advice for soldiers before they march off to battle, but a good commander should also be keenly interested in the safety of his troops when defeat seems imminent. Every time I pass Tangeumdae in Chungju, North Chungcheong province, I think about Shin Lip, a general who lost a battle against the Japanese Army in the mid-Joseon Dynasty. That led to the fall of the capital, Hanyang, as Seoul was then known. He fought with his back to the river in Dalcheon.

I keep thinking of risk aversion as the presidential election draws near. Presidents should not take gambles that may pay big but risk the loss of the nation.

Former President Roh Tae-woo's pledge to evaluate his achievements in the middle of his term and President Kim Dae-jung's vow to introduce a cabinet government in the second half of his term were unfulfilled. They were mistakes because the pledges were made at a time when the presidency was at stake but lacked any element of minimizing risk.

Yesterday's failures are repeated today. For example, there is no reason to oppose revision of the Constitution if it were vital for the development of Korea. But the proposal by some Millennium Democrats seems more complicated. Is it, as some allege, a conspiracy to deny Roh Moo-hyun, the legitimate candidate, his nomination? I have no way of knowing, but I do know that a constitutional revision is unlikely because it requires two-thirds of the Assembly to agree. Perhaps the idea is just political maneuvering, but the proponents are gambling with the country's future and trying to take the decision out of the hands of the electorate.

Mr. Roh stands on the opposite side. I was shocked at his pledge, made during the MDP presidential primaries, that he would request a vote of confidence in his presidential candidacy should the MDP lose the June 13 local elections in Busan, Ulsan or South Gyeongsang province. Give me victory or death!

I thought to myself at the time that Mr. Roh was showing a strong sense of responsibility. But the vote of confidence so boldly presented by Mr. Roh has turned out to be a courtesy event involving only the approval of the executive committee of the party. It made me feel bitter because it was staged and meaningless.

Mr. Roh has cast the dice again, this time on the results of the Aug. 8 by-elections. He said there would be no party convention before Aug. 8, but by the end of August he will accept suggestions from within the party to hold another election to confirm the party's presidential candidate. Political pundits say that holding another election in the time frame Mr. Roh proposes is impossible, which just adds to the confusion about what he is really up to. The MDP is not a training center for presidential primaries, so the proposal of its presidential candidate to hold still another election is awkward. His motives are in doubt; skeptics say his proposal is an initiative against party opponents who are calling for the revision of the Constitution and the breakup of the MDP.


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The writer is an editorial writer of the Joongang Ilbo.

by Joseph W. Chung

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