[VIEWPOINT] Nation's Top Priority: Political Reform

Some observers have recently argued that political reform should be postponed in order to stabilize the economy as the nation's top priority because of increasing concern about a possible economic crisis.

If we could stabilize the economy by postponing political reform, that would be fine, but politicians are responsible for economic policies, and politicians will never give more priority to economic problems than to politics.

We have to recall the cause of the foreign exchange crisis four years ago. The economic crisis started suddenly in 1997 as our foreign currency reserve was exhausted.

The government tried to maintain the value of the won at 800 to the U.S. dollar, while speculators inside and outside the country invested in relatively cheep dollars in the belief that the won was overvalued given the massive trade deficits Korea was running. Such a phenomenon began in mid-1997, but the government exhausted our hard currency reserves in order to maintain the value of the won at 800 per dollar until late 1997.

Why was the Kim Young-sam administration obsessed with a currency value of 800 won per dollar? The government's real obsession was keeping prices stable. Former President Kim pledged to keep inflation at below 3 percent during the presidential election campaign. During his administration, he could not prevent wage rises because of the democratization movement, and so tried to stabilize the economy by pegging the foreign currency rate.

In addition, the government seemed to be mesmerized by its success in achieving a national per capita income of $10,000. At that time, national income per capita was 8 million won, which translated to $10,000 at the rate of 800 won per dollar. If the exchange rate went up to 1,000 won per dollar, national income per capita would have been lowered to $8,000.

The administration hoped to gain political benefits by maintaining the currency rate at 800 won per dollar until it was forced by the market to abandon that exchange rate in late 1997. To put it simply, politics was fundamentally responsible for driving our economy into the 1997 crisis. Have we asked politicians and the ruling party to accept ? in a meaningful way ? their responsibility for triggering the national disaster? We did nothing more than pick a few people responsible for economic policy to court, where they were found not guilty and were absolved from any further accusations. Such trials were wrong to start with. In response to their missteps in government policy, we should have held them accountable in terms of policy and politics, not criminal law. But it was our only option, because the party politics system is not properly established.

The presidential candidate from the Grand National Party, the successor of the ruling party during the Kim Young-sam administration, failed in his election bid in the next presidential election, but the failure cannot be called a punishment for policy failures. It is, in fact, even more ironic that the GNP became the majority party in the Assembly at the general election held last year because of the regionalism that pervades Korean politics.

The current administration only has less than two years before its term ends. Election of local autonomous governments will take place next year, and the presidential election campaign will follow. Under the prevailing political system, politicians will constantly change their factions and continue to focus on personalities and regions instead of developing an ethic in which politicians are held responsible for policies they enact. Under these lamentable circumstances, is it possible for the current administration to concentrate on resolving economic problems, leaving politics aside?

Politicians carry out economic policies. It is never possible to induce politicians, who instinctively pursue political gain, to follow economic principles.

Reforming the political system so that politicians will be disciplined properly for their actions is the only way to rescue our country.

by Lee Young-sun