Nostalgia not to be repeatedThe Christmas season in 1997 was dismal and miserable for Koreans. People tend to forget sad and painful experiences easily. But Christmas Day 1997 is a day most Korean adults cannot easily forget. It was the day when the International Monetary Fund (IMF) and Group of 7 global powers decided to extend the bailout fund for a Korea that was teetering on the brink of declaring insolvency on its maturing debt.
Western media called it a Christmas gift to remember for Koreans. Then-IMF Managing Director Michel Camdessus called the bailout fund a “blessing in disguise.” We had no choice but to swallow the condescending comment from Western leaders and promised never again to get ourselves into such a pitiful and humiliating state.
The year 1998 was a nightmare from the beginning. The streets were empty because people could not afford to fill their cars with imported gas due to the plunge in the Korean won. Employees of one of the biggest banks - Korea First Bank - found themselves out of a job. Thousands followed suit as both big and small companies closed. Koreans learned how merciless the greenback can be.
But Koreans weren’t easily defeated. They had been different from the Greeks who also found themselves in fiscal trouble. People all rushed to help, and politicians, business and the labor sector became united. The president pledged to transform the economy more sweepingly than the IMF wanted. Corporate mega-deals, restructuring and reforms were expedited at full speed. The tripartite government, labor and management reached an agreement fast, and the National Assembly passed the labor law to make layoffs easier without any delay. Companies sold whatever they could. People donated their gold. One senior journalist donated a gold carving from the medal of appreciation he received when he left as a chief reporter covering city police.
That year, there was no liberal or conservative in the media. Each outlet had one voice. Reporters covering the financial supervisory commission called themselves army troops serving their country in trouble. They temporarily set aside their critical voice to cheer on the government. They did not report on complaints from conglomerates about the reforms being too harsh and kept silent even as some extreme unionists threatened to blow up their homes.
Seventeen years have passed, and we again hear alarm bells ringing. But authorities are disoriented. The president says we are in an emergency situation while the National Assembly speaker disagrees. The deputy prime minister in charge of economic affairs says the economy is going to pick up next year. The presidential office, government and ruling party cannot even agree on the state of the economy. It is no wonder that the solutions they come up with raise doubt.
Some things are the same and others are worse than the late 1990s. The economy is swarming with so-called zombie companies that are sustained through financial bailouts and debt. The labor reform law is stuck in legislative deadlock. The United States is again wielding global clout. Young people are facing a jobs crisis. Emerging economies are in collective danger.
These are the ominous similarities. What’s different is the ever-stretching public, corporate and household debt. China is losing steam fast. Japan is revived. We are divided. The only fortress is the foreign exchange reserve of $368.6 billion, which is over 15 times greater than what Korea had when it suffered a liquidity crisis. But can that be enough protection to keep our country safe from another crisis?
A former prime minister and Saenuri Party heavyweight lawmaker, Lee Han-koo, does not think so, as he raises his voice about the country’s dire situation. Many people fear it will be too late when people realize the danger. The country was rebuilt to protect the weak, and the people in high places are ruining it again. The nostalgic drama “Reply 1988” has spurred retro fever. But this retro wave taking us back to the nightmarish 1998 is something we must all try desperately to avoid.
JoongAng Ilbo, Dec. 24, Page 34
*The author is an editorial writer of the JoongAng Ilbo.
by Yi Jung-jae
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