[VIEWPOINT]Horizontal ladders and equity

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[VIEWPOINT]Horizontal ladders and equity

There is a well-tried maxim, “Heaven helps those who help themselves.” The reverse, of course, is that it won’t help those who don’t. The spirit of self-help is very important.
Samuel Smiles, a 19th century political reformer, said that the maxim was a small compass that embodied the wisdom of vast human experience. The spirit of self-help is the root of all genuine growth in the individual, and it constitutes the true source of national vigor and strength. Help from within invariably invigorates, but help from without is often enfeebling in its effects and takes away the stimulus and necessity of doing for oneself. Mr. Smiles also said if men were subjected to over-guidance and over-government, they would inevitably be rendered helpless.
The scholar who elevated the spirit of self-help to “the spirit of development” is Korea’s representative market economist, Jwa Sung-hee. In his recent book, “The New Wealth of Nations,” Mr. Jwa emphasized that the spirit of self-help in becoming a man of success is the source of power to develop society.
According to his logic, there are two kinds of world views, a vertical one and a horizontal one. In our lives, there are ladders standing vertically. People will take their position on the ladder that is decided by the degree of achievements they have made through their own efforts and ability. That is, their position is decided by the degree of self-help spirit they exercised.
It could be heaven, our society and colleagues around us or the market in economic terms that determines our position on the ladder. This is the “vertical world view.” It takes the position that we have to accept differentiation as it is.
But there are many who believe that the vertical ladder should be laid down horizontally. These people claim that although there are differences in ability and the amount of effort, human beings should live together equally, as we are the same people and are all equal. In this world view, there is a tendency of attributing the reason for our success or failure to others or social irrationality. This world view derives from a sense of justice that enrages people who see inhumanity.
Although the vertical world view is a source of power that moves social development, there are also positive functions of the horizontal world view.
Measures that supplement the ill effects of differentiation are provided by the horizontal world view. But problems arise when the horizontal world view does not stop at supplementing, but becomes the mainstream of society.
If the ladder itself is laid down horizontally, we cannot expect social development. The experiences of South American countries that were once caught in the grip of populism are typical examples of such failures.
The comprehensive real estate tax, a punitive tax on those who own many homes or other real estate, is a product of a horizontal world view. Its purpose is to disadvantage multiple housing unit owners by considering their profits as not derived from hard work but as windfalls gained through unlawful speculation. In this comprehensive real estate tax and elsewhere, egalitarianism is now gaining power in our society.
The Uri Party, which suffered a landslide defeat in the local elections in May, said after that defeat that it would take care of Korea’s economic problems. The organization that the party established for this purpose is a council for restoring the livelihood of ordinary people. Instead of calling it a council for restoring the national economy, it is called a council for restoring the economy of the grassroots people. The intention is clear enough; there is a political calculation to divide the people into “rich” and what the government likes to call the “grassroots” before it goes to work. That was seen in Friday’s real estate tax change announcement. The owners of homes worth less than 600 million won ($630,000) are middle class people, so they have nothing to do with real estate speculation. Therefore, the government will lower the property tax rate on their homes. The administration has picked 600 million won as the standard for deciding whether a house is for a speculative purpose or for living in.
It is necessary to take good care of the economic problems of grassroots people. But it is dangerous to make the poor and the rich confront each other. Right after the local elections, a self-employed businessman said, “The governing party is said to have tried hard to deliver a blow to rich people who live in the districts south of the Han River, but that has only resulted in making the lives of the grassroots people harder because the government measure only made the rich people stop spending their money.”
Contrary to its purpose, egalitarianism has added wrinkles to the faces of the poor. If the administration and the Uri Party want to come forward to help the grassroots people on the basis of a horizontal world view, the lives of the poor will get even more difficult and the possibility of economic development will continue to diminish.

* The writer is the business news editor of the JoongAng Ilbo.

by Lee Se-jung
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