&#91FORUM&#93Policy and one-armed economists

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[FORUM]Policy and one-armed economists

In 1947, U.S. President Harry S. Truman was bewildered after listening to a report on the American economy by the chairman of the Council of Economic Advisers, Edwin G. Nourse.
Mr. Nourse’s explanations contained hypotheses that could go either way; he often used the phrases “on the one hand,” and “on the other hand.” After the adviser left his office, Mr. Truman lamented to his aides that he needed a one-armed economist.
Mr. Truman was unadorned and straightforward. In order to end World War II as quickly as possible, he approved the use of atomic weapons in Japan. He was decisive enough to fire General Douglas MacArthur Jr., who successfully defended South Korea from an attack by North Korea, for disagreements with government policies on how to fight the war. Despite his dissatisfaction with his economic adviser, Mr. Truman remained tolerant, and Mr. Nourse kept his position for another two years.
President-elect Roh Moo-hyun probably has a similar anguished feeling in selecting an economic deputy prime minister. Many candidates for the job would say, “Reforms are needed on the one hand, but on the other hand stability is also important,” or “Distribution of wealth needs to be improved on the one hand, but on the other hand, economic growth cannot be neglected.”
Those who dare to hew one line may sound authoritative, but they do not have a sense of balance and run the risk of making mistakes. Those who boast they can take care of both needs do not sound trustworthy. Since economic issues are complicated and economics has its own limits, a conscientious and modest economist would not assure a politician he could guarantee both.
In these unsettled economic times, a person who is more experienced than reform-minded is likely to win the appointment as deputy prime minister. The problem is that experienced candidates may be opportunists who have worked for any administration in power, authoritarian or democratic. A government that intends to break with the old “three-Kims” politics should try its best to look for a fresh face with qualifying experience.
Academic economists are not in vogue these days; earlier in our history, when expertise and language ability in the government was not so common, foreign-trained economists could make their mark. Now, bureaucrats are more resistant to outsiders, and nearly all ministers with scholarly backgrounds since the mid-1980s have failed in their posts. When academics enter government service, they should start with an advisory position or have some other preparation before being appointed ministers. Those who have been considered as candidates by the president-elect and have declined to accept the economic minister’s position are likely to know this problem and be aware of the limits of their aptitude.
If the new government is looking for economic minister candidates among public servants, it should appoint one who is known to have first-class abilities even if he is young. The current administration was criticized for appointing less-qualified officers because of their local or regional ties. In public service circles, everyone knows each other's ability. If a less-qualified person were appointed to an important position, both the private sector and the public service circles would look down on him and on the government. Then, neither reforms nor ordinary affairs are going to get done.
The economy, at least for the first half of the year, will be struggling. Thus, the government needs to give hope to the public by appointing a highly qualified candidate whose appointment the pubic would agree to. There would be no hope with a second-class appointee, either an academic lost in the bureaucracy or a bureaucrat with no clear idea of what economic policy should be.

* The writer is director of the JoongAng Ilbo Economic Research Institute.

by Ro Sung-tae

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