Budget extortion

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Budget extortion

There are two ways for a “shadow power” to accumulate wealth illegally. The first is to extort money from businesses. This practice occurred in both conservative and progressive administrations. A person in the shadows with power reflected from the president pressured companies by exploiting their weaknesses. Sometimes both sides gain from a deal. Once owners of a company make up their minds, the process is not complicated. The secret deal is less likely to be exposed. The companies walk the thin line between being accomplice and victim.

The other way is to steal from the national budget. The annual budget is a gold mine of over 400 trillion won ($340.4 billion) as of 2017. But that takes a more advanced technique than simple extortion as many eyes are watching. A ministry that requested a budget naturally knows what happens to it, whether a project is necessary and whose interests are involved. The civil servants at the office of budgeting in the Ministry of Strategy and Finance are also aware of it as they consult on the validity of projects with working-level officials throughout the year.

The National Assembly also reviews the budget. Before the budget bill is finalized, it is reviewed and approved. It is also evaluated upon being spent. Controversial projects are also monitored by civic groups. Because of the multiple layers of watchful eyes, it is not so easy to pocket money from state coffers.

In past administrations, the shadow powers mostly took money from companies. What makes the Choi Soon-sil gang distinct is that they not only extorted money from businessmen but also stole from government budgets. They may sound like low-level gangsters, but they are not so simple. Their tactics were bold and intelligent. Once a budget is approved for a project, it often is continued as long as no serious problem arises. So the gang can continue to extract money even when administrations change.

There is no way to know how much government money the Choi gang has taken or planned to take. The opposition Minjoo Party of Korea estimates that 520 billion won from more than 20 projects was funneled to Choi, President Park Geun-hye’s longtime friend, from the 2017 budget alone. The People’s Party estimated a figure of 420 billion won. They mostly involved projects that have the words “culture,” “creative” or “convergence” in their names. The Choi clan is presumed to have targeted the budgets for culture, sports and the so-called creative economy. Unfortunately, she went further. For example, 2 billion won allocated to K-meal project, which provides rice processed products to underdeveloped countries, is believed to have been pocketed by Choi. This is an agricultural budget not related to culture, sports and the so-called creative economy.

The 2017 budget is so confusing that it cannot be trusted. All suspicious projects need to be reviewed. The budgets that made Choi rich must be cut out like the fat on meat. But timing is the problem. We don’t have much time left to take a second look at next year’s budget. Aside from the current scandal, the government and the National Assembly must review the budget first. If we don’t thoroughly look at the budget, this will lead to future troubles.

What’s more troubling are the budgets that have already been spent. The 2013 budget was planned by the Lee Myung-bak administration. Theoretically, Choi began wielding influence from the 2014 budget.

For instance, the 7.1 billion won budget for the Cultural Creation and Convergence Belt planned by Cha Eun-taek, Choi’s aide, first appeared in 2014. Last year, 11.9 billion won was allocated, and this year it was drastically increased to 90.3 billion won. 109.3 billion won was already spent. The prosecution must calculate how much was allocated for the projects and how the money was spent. If the money went straight to the Choi gang, it must be collected through special legislation.

Stealing from the state is a crime against the people. It is more sinister than extorting money from companies. The government that planned the budget and the National Assembly that passed the budgets should be ashamed. If they knew the budget was benefitting Choi, they were derelict in their duties. If they didn’t know, they were incompetent.

The government is busy making excuses probably because it finds it embarrassing to find flaws in their budget planning. Yet they don’t understand the gravity of the situation or are out of their minds. Unless they sincerely repent and learn from the mistake, it can happen again.

There is one more thing to keep in mind. No unnecessary budget plan should be passed by the National Assembly. At the same time, such important areas as start-ups, the Korean Wave and PyeongChang Olympics must not be scrapped without proper review.

JoongAng Ilbo, Nov. 21, Page 28
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