After the budgetEven before the ink on the government budget for 2018 has dried, a large supplementary budget bill is on the way through the National Assembly without full deliberations. The Moon Jae-in administration last month drafted a 3.9 trillion won ($3.63 billion) extra budget to help ease the pains from massive layoffs in certain regions and encourage the young generation to find jobs in small and mid-sized enterprises.
The government’ idea of injecting a fiscal stimulus ahead of imminent local elections on June 13 — even before its original budget for creating jobs is exhausted — came under attack for currying favor with voters before the local elections. To make matters worse, public concerns are growing over an agreement between the ruling and opposition parties to put the supplementary budget bill to a vote by as early as Friday after linking it to passage of a bill to appoint an independent counsel to investigate the so-called Druking scandal involving a power blogger in an online opinion rigging campaign.
The Party for Democracy and Peace’s floor leader Jang Byung-wan, a former minister of planning and budget, criticized the government for a critical lack of appropriate procedures. “To deliberate on a supplementary budget bill, the government must explain the need for it before the Assembly. After a speech by the government, relevant committees start looking into the bill,” he said. “No extra budget bill has been put to a vote in just three days.” Such a speedy vote can hardly avoid criticism that our lawmakers are overly eager to spend tax money.
A bigger problem is the government’s lax attitude. It seems to believe that it did as much as possible with the extra budget. While the global economy is enjoying a boom, Korea’s seems to be headed in the opposite direction. Our job situation is not improving and the operation ratio of our manufacturing sector has dropped to its lowest level since 2009. In March, the Organization for Economic Cooperation and Development ranked Korea’s Business Confidence Index (BCI) the lowest among 31 member nations. In a survey by the Korea Economic Research Institute, 65 percent of foreign investors singled out our labor policies as the biggest stumbling block for their businesses in Korea. That translates into a disgruntlement with the government’s policies of drastically raising the minimum wage and cutting working hours.
Economic think tanks anticipate that the global economy will slow from the second half of the year. The government must be prepared for a moment of truth after executing the supplementary budget. The only way for it to avert a nightmarish scenario is stopping its anti-corporate policy and revving up our companies’ need to invest.
JoongAng Ilbo, May 16, Page 30