On a splurge for electionsThe ruling Democratic Party (DP) and government have lost control over their extravagance with Covid-19 relief payments out of desperation to win the upcoming mayoral by-elections in Seoul and Busan. Few would disagree with the need for help for the self-employed and small merchants whose businesses suffered due to the government’s social distancing rules and a protracted Covid-19 threat. But the DP’s latest spending proposal of 19.5 trillion won ($17 billion), which was approved in a Cabinet meeting on Tuesday, raises too many questions.
DP Chairman Lee Nak-yon suggested the package could exceed 20 trillion won during a legislative review. The government praised Lee for proposing such a hefty spending package. Is it not aware of how much had been spent so far without carefulness? The lead-up to the latest relief package after the first round of 14.3 trillion won in relief payments shortly after the April 15 parliamentary elections last year is dumbfounding.
The fourth relief payments will go to almost all self-employed people, regardless of the size of the impact from Covid-19. Relief checks will be extended to workplaces employing more than five and with annual sales of up to 1 billion won. A business earning 1 billion won a year can hardly be regarded as “small.”
Still, they are eligible for a grant of up to 6.5 million won when electricity bill exemption is included. A business owner with multiple stores can collect up to 10 million won.
Most of the beneficiaries live in the two most populated cities of Seoul and Busan who go to the polls to pick their mayors next month. The opposition attacked the plan as “vote-buying through national debt.” America also administers colossal spending, but the aid is doled out strictly on the study of losses based on tax payment. As a result, there is less of a dispute over fairness. Korea’s relief plan skips such details and differences by business type or scale or impact from Covid-19. Even as the second and third relief measures are yet to be fully administered, President Moon Jae-in hastens to hand out the money in March.
Half of the latest spending, or 9.9 trillion won, would have be financed through issuing national debts. The rest is dug out of any reserves for future contingency. Are one-year mayoral posts left vacant by past heads who committed sexual misconduct worth that much of national spending? The DP and government also passed a special bill aimed at constructing a new airport on Gadeok Island off Busan at the cost of 28 trillion won. National liabilities have neared 1,000 trillion won, but how they can be repaid remains uncertain as the DP and government are entirely engrossed in winning elections.