[Outlook]Reform the reformists

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[Outlook]Reform the reformists

A long time has passed since I visited Tokyo. There was a conference, “The Future of Asia,” held by the Nihon Keizai Simbun. Outside Korea, people had positive views on Korea. Lee Kwan Yew, the former prime minister of Singapore, and Gloria Arroyo, the president of the Philippines, admitted that Korea is one of the leading countries in Asia and wanted it to perform well as a leader.
Yosuke Kondo, the representative of the Japanese Lower House from the Democratic Party, who sat next to me at the dinner, also envied Korea, saying that Korean companies have grown big enough to merge with Japanese companies. He also mentioned the Korus FTA.
It was good to hear nice words about Korea but I was more interested in Japan’s lost decade. Japan’s economy remained sluggish for 15 years, from the time its bubbles burst in 1991.
When Lee Kun-hee, the chairman of Samsung Group, visited Japan, he asked an executive in Tokyo: “Why is that period called the lost decade? What was lost during that time?” The executive hesitated for a while and answered. “It probably means that people lost jobs and properties.” Lee said, “But I guess it means that the Japanese lost hopes and dreams during the lost decade.”
Japan, however, is reviving now. The streets in front of Tokyo Station, where the Mitsubishi Group companies are located, are full of energy. The Shin-Marunouchi Building has 24 kilometers of underground paths connecting the eight underground levels, attracting 20 million people yearly. The employment rate among Japanese college graduates nears 98 percent. Ordinary university students receive job offers from several companies. They have just begun to have hopes and have started running with them.
Kondo said that the reason that Japan could overcome the lost decade was the collapse of bureaucracy, paradoxically. Government officials who led Japan’s economy at will were criticized by the public. Civil servants started to feel powerless and government regulations started to be eased. Former Prime Minister Junichiro Koizumi played a major role in easing regulations. From this spring, when companies invest in equipment, they will receive tax reductions and they can build factories in big cities including Tokyo. If companies transfer to local areas out of big cities, they receive benefits such as tax reductions, unlike in Korea where the government forces companies to move out of Seoul in the name of balanced development. A law to prohibit unjust personnel affairs is to be passed in the House of Representatives. Japanese college students no longer aspire to become civil servants. Particularly, talented students do not apply to be employed by the government. In the past, graduates of Tokyo universities looked for jobs at the economic or industrial ministries. But now they move to global companies such as Goldman Sachs or other private Japanese companies. That is the opposite of Korea where even engineering and technology majors struggle to become government officials.
Small- and medium-sized companies played an important role in reviving Japan’s economy. Those companies who transferred to China to avoid high wages are returning to Japan because they now have advanced technology to balance high wages. The Japanese used to believe that once they were hired they would work for the same company for their entire lives. But now the number of irregular workers has reached 4 million. Productivity has increased.
Korea also had a lost decade. The financial crisis broke out in the later phase of the Kim Young-sam administration. During the Kim Dae-jung administration, we shoveled excessive aid to North Korea. There was serious corruption inside the government. The Roo Moo-hyun administration has spent four years striving for balanced development and they shouted for equality. All sectors in our economy have remained the same during all those years. Working-class people and youth who just graduated, the powerless people in our society, were most affected by this. Those people who shout for reform have feasts among themselves. The peak was their trip to Iguassu Falls under the pretext of seminars on reform. The administration calls itself a participatory government but suppresses the media even more harshly than the military regimes. While Japan’s government officials are responsible for their lost decade, in Korea, these people are responsible for the lost decade.
Outside of this country, people still compliment Korea. That’s because of the power we have accumulated in the past. Now our treasure box is running dry. China is chasing us closely and Japan has reignited its engine. How can Korea survive when it is tens of times smaller than these neighbors? We need to drastically change the direction of the flow.


*The writer is the vice publisher and chief editor of the editorial page of the JoongAng Ilbo. Translation by the JoongAng Daily staff.

by Moon Chang-keuk

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