[Viewpoint]Politics borrows real estate tactics

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[Viewpoint]Politics borrows real estate tactics

‘Wedging-in” is a nasty real estate speculation tactic. A speculator buys a small parcel of land in a location where development is planned, and stubbornly resists offers to buy the property. In the end, he sells the land at a price several times the market rate. Developers are under pressure to move their projects forward, so they are at the mercy of the speculator’s scheme.

Wedging-in not only delays development projects but also adds to land acquisition costs, ultimately raising housing prices in new developments. Moreover, the speculation tactic makes other land owners who sold their parcels at the market rate feel deprived. It creates an evil precedent; unfair behavior, people learn, leads to higher profits.

Having witnessed that some make great fortunes by wedging-in, people compete to buy and hold key pieces of land whenever there’s a rumor of apartment complex development.

Land prices skyrocket with speculation. When the land prices rise so high that apartment sales will not cover the cost, the developer has only one option. He has to give up the project. When the apartment development project is canceled, the land owners regret their speculative behavior, but the chance of making a fortune is lost.

The opposition Democratic Labor Party occupied the National Assembly in Yeouido, Seoul for 20 days. They locked up the National Assembly’s main floor and recklessly resisted, claiming they would not let bills proposed by the ruling Grand National Party come to the Assembly at all. It was no different from real-estate wedging-in.

In the National Assembly, a political party’s influence is directly proportional to the number of seats it holds. However, by physically occupying a key strategic point in the National Assembly, the minority party tried to wield more influence than its numbers warranted. They wedged in and demanded a higher price than the market price.

The government and the ruling party felt such an urgent need to save the economy that they appeased and coaxed the opposition to abandon its effort.

But the opposition party has glimpsed the weakness of the ruling party and resisted stubbornly. The ruling party pleaded to pass only the core bills in this session and postpone some disputed measures, but the opposition turned down the deal. The giant ruling party was helpless before the opposition party.

In the end, the Speaker of the National Assembly had to promise not to introduce controversial bills for direct voting. The minority opposition party’s demonstrators rejoiced at the triumph of their wedging-in protest as they ended the occupation and left the main floor.

Unfortunately, the opposition party’s tactic was not entirely successful. For a real estate wedging-in to be profitable, the developer has to pay far more than the market price. However, the opposition party left empty-handed.

They only frustrated the ruling party from introducing controversial bills. While they might have hoped to play the role of victims dragged out by the guards, such an opportunity did not present itself. Instead, they left a strong impression among citizens that they brought lawlessness to a hall of democracy. Instead of the great fortune they sought, they ended up with a bad reputation.

Also, there is no guarantee that the ruling party will give up on introducing the bills. In terms of real estate speculation, they merely postponed the project.

In fact, the opposition party does not own a valuable parcel of land even though it wanted to make a fortune by wedging-in. All they can do is obstruct the majority party’s legislation. What can they gain in exchange for not interfering with the natural democratic process of decision-making? They are like small-time street gangs extorting money from street vendors to let them do business.

The opposition party’s miscalculation does not stop there. Badly burned by the wedging-in tactic, the ruling party will not be tricked again. The opposition party has reached the limits of wedging-in politics.

The problem is that the biggest victims of such cynical politics are not the government and the ruling party but the citizens.

The opposition party tried to hinder the enactment of bills that will save the economy. What happens to the country if the government and the ruling party give in to the opposition party’s wedging-in and abandon the project called economic revival?

Of course, the ruling party and the government will be greatly damaged. But the citizens will suffer the most.

The writer is an editorial writer of the JoongAng Ilbo.

by Kim Jong-soo
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