[EDITORIALS]Let market forces do the jobThe government is designing measures to support restaurants, hotels, taxi and truck operators, wholesalers, retailers and dress makers. The government said that it intends to help those businesses survive their difficulties amid extremely sluggish domestic consumption.
The government’s intention to aid small businesses is good. But it will not be effective or desirable to provide funds only to businesses with chances to survive. First of all, the idea of providing tax money to restaurants, hotels, shops, taxi and truck operators and dress makers is problematic. However bad the economic conditions of the owners of those businesses may be, they chose to enter those businesses by their own judgment and are responsible for them.
If they can no longer maintain the businesses due to an economic downturn or their lack of competitiveness, they should bear the responsibility themselves. If we look into those business owners’ individual circumstances, each of them is pitiable and heartbreaking.
But it is the market principle that those who lack competitiveness should be driven out of the market. It is not an issue that the government should intervene in. Can public officials decide who is eligible for government support and who should be weeded out? Such a decision should be made by the market, not by the government.
Oversupply is the ultimate reason why the conditions of small businesses have deteriorated. Since the 1997-98 foreign exchange crisis, those who were laid off from corporations have opened small businesses. There is no other solution but weeding out uncompetitive businesses. It will cause pain, but it’s inevitable. If the government intervenes and supports businesses it selects, it could have higher economic and social costs in the end. The government should do no more than reduce their pain and give chances of revival to the businesses that are being weeded out.
The government should stop making respective measures for each industry. If the conditions of laundries and beauty shops deteriorate, will the government act to save those industries too? Leave it to the businesses themselves. The only thing the government should do regarding the issue is reduce regulations to boost the economy and create more jobs.