[EDITORIALS]Labor’s irrational ‘fund’ idea

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[EDITORIALS]Labor’s irrational ‘fund’ idea

There is an ongoing controversy over the creation of a so-called “social contribution fund.” While Labor Minister Kim Dae-hwan expressed support, saying “It is necessary to hear the public’s view,” for the demand by unions at the four major carmakers that 5 percent of business profits be used to create social welfare funds, Lee Hun-jai, the deputy prime minister and finance minister, opposed it as “too burdensome for the market.” Management, of course, has strongly rejected the demand.
It would indeed be desirable if a strong, profitable business volunteered to spend part of its profits on the poor or for other public welfare purposes. However, it is inappropriate to discuss the creation of such welfare funds so irrationally. Above all, it was wrong for the union to raise the subject at the labor-management negotiation table. Distribution of company profits, unlike wages and labor conditions, is not subject to labor-management negotiations. Moreover, the unions’ statement that they will collectively walk out should their companies refuse is baffling. For whom are they fighting?
It was also imprudent of Mr. Kim to express support for such an irrational demand. If the labor minister keeps interfering in this manner, it will become an issue for the entire industry. Normally, it is the right of the management and shareholders to decide how they will spend their profits, after paying their taxes properly. This is not a problem for labor or the government to interfere in.
The present task for our economy is to increase business investment and productivity. That is how we’ll create new jobs, make consumption possible and enhance corporate competitiveness to save our economy. In the background of the recent investment slump is the hostile state of labor-management relations. In particular, foreign investment has been affected negatively by the increasingly strong political colors that unions have taken on, and their increasing demands for participation in management decisions. To demand that the business hand out part of their profit this way is to demand that we give up the future of our economy.
The unions must drop these demands, and the labor minister must stop intervening in the problem. Once again, this is not an issue for labor-management negotiations.
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