[Outlook]A new way to govern

The new administration is being launched today. People seem to have saved their highest expectations for a restored economy. It is an eternal truth that a government’s survival is based on making it possible for people to live a rich and comfortable life. However, the best way to do this may change depending on the times we live. Where do we stand now? What will the new government do to help people live an affluent life over the coming five years?
Let’s take a look at international situations. It is evident that economic integration between Korea and the global community will continue to prosper for the next five years. The ratification of the Korea-U.S. FTA will have huge sociopolitical impact on Korean society, and will serve as a catalyst to further promote the economic integration of East Asia.
This will usher in a new era governed by strong regionalism and China’s rapidly growing economy. The best way to revive the Korean economy is to make inroads into global markets by developing competitive new technologies and industries, even though there are serious obstacles, such as the U.S. subprime mortgage crisis, an economic slump and an anti-globalization movement.
However, we must continue to replace declining industries with emerging competitive ones. To this end, the government should take appropriate steps to promote and support retraining and education. It should also strengthen the nation’s social safety net with a view to helping laid-off employees move from decaying industries to more competitive ones. If this is done, there will also be less resistance from labor to restructuring.
In addition, the successful social integration of the Korean people will lay a firm foundation for strengthening international competitiveness, also serving as a basis for Korean politics. In the past, if someone insisted on the importance of efficiency and competitiveness, he was considered a conservative. Likewise, if someone underlined the importance of equality and integration, he was regarded as a liberal. However, this logic is out-of-date and overly simplistic. It applied to Korea’s closed economy in the old days.
So let us now center our attention on domestic situations. We still have vivid memories of the 1997 financial crisis. The major culprit behind the unprecedented crash was the aftermath of the development-oriented strategies of the 1970s.
Conglomerates raised the necessary capital through cozy relations with political circles rather than rigorous examination of lending procedures, which led to unfettered investment practices and an increasing number of bad loans. The phenomenon of moral hazard was rampant throughout the nation, and financial sectors and the national economy became slaves to the conglomerates.
We idled our time away, failing to reform the organizational contradictions of the previous decade. Our fatal weaknesses were exposed in the new order of world economies, which were driven by financial integration. This was the root cause of the 1997 financial crisis.
Finally, the 1997 crisis led to the turnover of political power at the end of that year. The Roh Moo-hyun government spared no efforts to decentralize political power and then revive the mechanism of checks and balances. The prosecutors’ office, National Intelligence Service and National Tax Service achieved independence, and relations between politics and business have largely weakened.
However, the government should also provide leadership by putting able people in important positions and keeping everything above board. It should also create sustainable diplomatic relations with the view of helping power decentralization and the system of checks and balances function well. The Roh government was not successful on this matter.
What principles and philosophies the new government should choose to guide economic management are evident. If it wants to revive the national economy in the era of globalization and complicated world politics, it should create policies that improve the safety net for the weak and poor and strengthen retraining procedures for employees.
It also should make its utmost effort to decentralize political, economic and social powers, with the establishment of mutual checks and balances among them. Simultaneously, the government should take the initiative in promoting national integration based on the fair selection of fit persons for important positions.
If people make providing an economic boost a national priority without paying attention to the importance of politics, it will be of no benefit to the nation. Put new wine in a new bag. It is an epoch-making task for the Lee Myung-bak government from the outset.

*The writer is a professor of international politics at Seoul National University. Translation by the JoongAng Daily staff.

by Yoon Young-kwan