[OUTLOOK]Economics as extension of politics

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[OUTLOOK]Economics as extension of politics

“Peace is the extension of war by political means.” Probably because of its fancy rhetoric, not its meaning, this expression has a number of variations. Although political science students may laugh, Edward Nell, a professor of economics, asserted that “politics is sometimes economics by other means.” At the risk of upsetting economics students, I propose this variation: “Economics is politics by other means.”
These days I believe that economics is the extension of politics, especially when you see businessmen being summoned for questioning. These businessmen asserted that they gave money because politicians wanted it, and for that, the businessmen became the subject of the investigations.
Of course, some may wonder whether they really gave because they were threatened and were afraid of revenge or whether they instead gave the money of their own will. Here is some evidence that the businesses produced for their side: According to a Korea Chamber of Commerce and Industry survey of 31 affiliates of major companies with assets exceeding 2 trillion won, 63.3 percent of respondents gave political funds “for fear of disadvantage,” and only 3.3 percent did so “for favors.”
How many will actually believe these answers? The recipients of the money will strongly deny the that they threatened anyone.
Son Kil-seung, the chairman of SK Group, said that he did not voluntarily give 10 billion won ($8.5 million) to the Grand National Party but he was forced to do so or else suffer the consequences. I wish I could believe him, but I couldn’t help feeling a little skeptical when he said that during the Kim Dae-jung administration, his group gave a total of 14 billion won to the Millennium Democratic Party and 800 million won to the Grand National Party for four years.
Although it is customary for businesses to give 60 percent of its political funds to a ruling party and 40 percent to an opposition party, he entirely ignored this custom and gave his money as he pleased, a ratio of 70 to 4.
However, when the balance of power shifted, and the opposition party became the ruling party in the last elections, the now-confident ruling party could have possibly threatened him.
By seeing economics as politics by other means, businesses brought this situation onto themselves. SK’s misfortune stems from its misplaced bets. Or the ruling party, in which the group firmly believed, ran out of luck. SK should have restrained from gambling before blaming itself for its lopsided donation ratio or the absence of a “shield like Kim Dae-jung.”
This time, the readers will protest. Who doesn’t know that giving money to politicians is wrong? Politicians chanted the slogan of “politics without money,” and the business community constantly repeated the its vows of self-reflection and other resolutions, from the code of ethics to self-purification campaign.
Among SK chairman Son’s remarks, the part about “my failure to read the change in ‘386 generation’ prosecutors caused the problem” is quite interesting. Bitterly disappointed with politicians’ unfulfilled promises for reforms, the chairman may have pinned his hopes on the prosecution.
I’d like to briefly mention two points. The first is that the prosecution should be independent of the political circle. Our prosecution has displayed excellent capability in the new field of “political insurance,” distinguishing whether the political donation was given for insurance purposes or for a favor. The prosecution clear a person who received hundreds of million won by deciding that the donation was not a payment for a favor, and sent another person who received just a few million won to prison because they determined the donation was given as a bribe.
This hair-splitting has sometimes created suspicion and repulsion, and drawn criticism of planned investigations or targeted audits. In reality, many people do not view the prosecution’s present inquiry into campaign funding as independent. However impressive the result of its investigation may be, the prosecution cannot persuade the people when the exercise of its power is politics by other means.
The second is to take our economic situation into account. Over drinks, a friend of mine moaned, “Gwangju did not know when the International Monetary Fund stewardship began, and remained almost the same even after it ended. Its economic foundation is very vulnerable. These days, more and more stores are shut up, but there’s no one who has any interest in buying them.” Will this only apply to Gwangju? Probably because of frozen domestic demand, companies, which could help thaw it out, continue to move out of the country. They are forced to leave because they can no longer endure economic hardship in Korea.
Here, politics should be economics by other means. Photos of businessmen summoned by the prosecution may thrill readers. But businesses are worried about the cost of the investigation as much as its result. Hoping that the prosecution’s probe into political funds will be “a sword in the sheath” in the future, I ask the prosecution to finish its investigation effectively and soon, imposing the least amount of burden on businesses and society.

* The writer is a columnist of the JoongAng Ilbo.


by Joseph W. Chung

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