More money Moon
The author is an editorial writer of the JoongAng Ilbo.
Meager monthly paychecks face another unwanted deduction from next month. Employment insurance premiums will go up more than 20 percent. The government said the extra funds from salaried workers’ paychecks is unavoidable, as employment insurance has run out of money due to the surge in state subsidies for the unemployed. Since the Moon Jae-in administration took off in May 2017, the government’s monthly unemployment benefits have been hitting record highs. Health insurance premiums also will increase three months later.
According to government data, the number of employed increased by more than 450,000 in August from a period a year ago. The government touts the biggest monthly gain in 22 years. But digging into salary earners’ paychecks to offer unemployment handouts suggests there are many jobless out there. Of the 450,000 new jobs in August, 400,000 were for those aged 60 and older. They were mostly hired for temporary jobs created by tax money. In fact, jobs for those in their 40s decreased by 120,000. Part-time jobs for senior citizens are expected to increase by over 700,000 next year.
About 10 million people in the lowest 20 percent income group make more from government handouts than from their own earnings. This is the first time this has happened since the data were first compiled. Infrastructure and development projects across the country require over 130 trillion won ($109 billion) of funding. Not all of them will receive the funding. But the ruling Democratic Party (DP) promises to do its best as it needs to win votes in the upcoming general election in April. Japan entered its lost decades through such profligacy and recklessness with public finance.
Political parties are in a Christmas mood. The leftist minority Justice Party even proposed to raise the monthly pay of conscripted soldiers to 1 million won from the current 400,000 won. The party does not care where the money comes from. It merely has it eye on winning back youth votes after it lost favor with young people after condoning the appointment of controversial Justice Minister Cho Kuk.
The Moon administration is carefree about the integrity of public finance. It has designed a midterm fiscal plan to spend more than its tax revenue. The deficit will certainly snowball as it plans to issue 60 trillion won in new debt next year. The administration must be an avid champion of a deficit-financed spending spree.
In order to differentiate from the top-down style of his predecessor, Moon told his staff not to take notes when he speaks and instead pose questions at secretariat meetings. He vowed not to create an overbearing presidential office. But not once have any of his aides raised questions about the effectiveness of massive fiscal spending to make up for the government’s policy failures or populist polices.
The Moon administration repeats the mantra that the economy remains solid. Recently, the president proclaimed the economy was moving in “the right direction.” He patted himself on the back by saying that the government achieved a “noticeable improvement in employment in both quality and quantity” thanks to the government’s all-out efforts to create jobs. He turned a deaf ear to the voices from the young generation who cry helplessness and hopelessness — and how could he explain the widening losses at public enterprises?
JoongAng Ilbo, Sept. 20, Page 34