No free bus ride

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No free bus ride

We barely avoided a general strike by bus unions across the country. That’s good news. But we are disappointed at the way the government approached such an imminent public transportation crisis as if it were only busy promoting the fruits of its implementation of a 52-hour workweek — such as a cut in working hours and enhancement of the work-life balance — without acknowledging the serious side-effects of its hurried policy. After the central government forced local governments to bear the costs of bus fare hikes, they demanded the central government raise its subsidies.

The government found solutions in upping bus fares and expanding the semi-public management of bus companies. Accepting the government’s demand, Gyeonggi has decided to raise city bus fares by 200 won ($0.17) and fares on buses traveling to Seoul and other regions in the province by 400 won, and also apply the new system to all buses. The central government tries to subsidize bus companies even though local governments have the authority to control bus businesses. The crisis was foreseen when the government did not include buses in the list of special exemptions to the 52-hour workweek last July. After ignoring the simple truth that there is no free lunch, the government is determined to send the lunch bill to the taxpayers.

The semi-public management system poses lots of problems because local governments have to make up for losses bus companies incur. Eight cities and provinces across the nation spent a whopping 1 trillion won to compensate bus companies for their losses. Seoul alone has spent 3.7 trillion won to subsidize such losses since 2004 when it introduced the semi-public system. Mayor Park Won-soon said Seoul will not have to raise bus fares, but the money has to come from citizens’ pockets nonetheless.

Central and local governments’ moral hazard pose another problem as seen in the endless cases of embezzlement and document fabrication to get subsidies, not to mention nontransparent accounting procedures of bus companies. The government must thoroughly monitor their accounting and introduce a tender system for licensing bus routes.

After all the tough negotiations, the bus companies will most likely end up meeting labor unions’ demands — with taxpayers paying part of the bill. As the 52-hour workweek applies to all workplaces employing over 50 employees from next year, small business owners will face similar strikes. Has the government prepared for that? Unless it devises a rational action plan, such crises will be repeated over and over.

JoongAng Ilbo, May 16, Page 30
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