[Viewpoint] What could 6 trillion won buy?

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[Viewpoint] What could 6 trillion won buy?

Politicians are running around like headless chickens squawking for free school lunches and cuts in college tuition, and their pretence is that they’re doing a big favor for the country’s students and their parents. Their arguments are half-baked and their motives are cynical.

Their logic suggests they could use a refresher course in economics and possibly civics. They argue that all that is needed to cut tuition in half is 6 trillion won ($5.6 billion) in annual government, and the money can come from pockets of the rich by calling off a plan to institute tax breaks for the high-income bracket. What they are saying is that there’s no harm in giving away the rich’s superfluous money to help the student population.

But the idea is hardly noble in the capitalist context and doesn’t make reasonable economic sense. Six trillion won a year is a huge sum that could accomplish miracles if used in the proper way.

First, why not give some relief to the 2 million Koreans with poor credit records. They seek out lenders in the black market who charge killer interest rates of higher than 40 percent - and sometimes are even shunned by them. Nine out of 10 can’t get loan applications accepted anywhere. Consumer loans from lenders now total 6.8 trillion won. With 6 trillion won, people at the bottom of the socioeconomic ladder, with nowhere to go to raise money to pay for hospital bills and other emergencies, could be salvaged and economically rehabilitated.

Second, credit delinquencies and consumer bankruptcies have generated major social problems like the disintegration of families and a rise in the suicide rate. Physical threats and blackmailing attempts by black-market lenders are serious and can even be deadly.

There are more than 1.76 million credit delinquents nationwide. Of them, 250,000 have been on recovery programs for the last three years. Their bailouts cost 500 billion won a year, or a total of 1.5 trillion won. With 6 trillion won, credit delinquencies could be erased.

Third, project financing loans of some 12 trillion won have crippled the savings bank industry. Of them, 5 trillion won have been deemed nonperforming. With 6 trillion won, bad debt at savings banks could be completely cleaned up.

There are other things we could do with that sum if we turn our gaze beyond Korean shores.

Starving children aged 8 to 13 in developing countries number about 600 million. Because governments and families cannot afford the funding, about 150 million children have to leave schools.

One fourth of the children in the developing world have not even had a single day of schooling. To give those 600 million poor kids six years of elementary schooling would cost 6 trillion won.

Our resources are limited. It is the politicians’ duty to apportion the resources. But political and emotional factors get in the way of efficient decisions. To get votes, politicians like to pit the middle class and poor against the rich. The rich have fewer votes come election time.

The leaders of the ruling Grand National Party have joined the free-for-all chorus regarding welfare and education.

The entire political universe is engrossed and obsessed with one issue: tuition. Even with a just cause, nothing can be achieved if the intention is to satisfy all. Samuel Johnson famously said, “The road to hell is paved with good intentions.”

Gwanghwamun will once again be blaze with candlelight vigils and ring with clamorous chants. People in truly deep financial distress sigh and weep in the shadows. Nighttime rallies, for them, are a luxury. They’re busy scraping up the won to get through another day.

What will happen when they realize their government spent the money that could have saved their lives on free lunches at schools and half-priced college education? They may not keep silence for long.

*The writer is an editorial writer of the JoongAng Ilbo.


By Lee Chul-ho
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