Working together at last
The ruling Saenuri Party and opposition New Politics Alliance for Democracy (NPAD) agreed to pass an 11.8 trillion won ($10.2 billion) supplementary budget to rejuvenate the supine economy at a plenary session of the National Assembly Thursday. Both sides have made compromises on thorny issues. While the ruling party accommodated the opposition’s call for a considerable reduction of the extra budget for building infrastructure, the opposition accepted the ruling party’s demand for finding practical ways, including raising of the corporate tax, to make up for a loss in tax revenue. The development will enable both parties to pass the supplementary budget within the deadline they agreed to.
However, the run-up to the agreement on the extraordinary budget looks quite disappointing. The Park Geun-hye administration and the Saenuri Party stuck to their belief that they can address a critical lack of tax revenue for four consecutive years through an additional issuance of national bonds. They also triggered controversy over the arbitrary insertion of the infrastructure budget into the supplementary budget, which the opposition camp claimed has little, if any, relevance to any substantial improvement in the average person’s livelihood. Meanwhile, the opposition came under attack for proposing the corporate tax hike in exchange for endorsing the supplementary budget.
Yet their efforts to meet the deadline, which is Friday, in the face of a struggling economy are worth our compliments given their deep-rooted intransigence on budgetary issues. The NPAD’s new approach - dealing with the supplementary budget separately from the controversy over the National Intelligence Service’s snooping on private citizens on mobile devices - is also an enlightened stance.
But the passage of the supplementary budget is only the beginning. The government must do its best to execute the budget quickly starting in August. The outbreak of Middle East respiratory syndrome wreaked havoc on our economy. The Bank of Korea Thursday came up with bad news on the lethargic state of our economy: Real growth of our gross domestic product for the second quarter was only 0.3 percent, 0.1 percent lower than the central bank’s earlier estimate. The figure is even lower than the 0.5 percent in the same quarter last year in the wake of the Sewol crisis. The government must execute the supplementary budget before economic players are further depressed.
But the government must not forget that the supplementary budget is only a stopgap measure. For the Korean economy to get better on a long-term basis, the government must raise birth rates and elevate social efficiency. We hope the latest agreement between the ruling and opposition parties can pave the way for constructive deliberations on how to benefit the livelihoods of the people.
JoongAng Ilbo, July 24, Page 30
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