Home > Opinion > Columns

From nuclear phaseout to cash handouts: A pattern of unquestioned policy

Published: 26 Jun. 2025, 00:02

Lee Sang-ryeol

The author is a senior editorial writer of the JoongAng Ilbo.

One of the most consequential policy missteps of the Moon Jae-in administration may have been its abrupt departure from nuclear energy. In an era when the Fourth Industrial Revolution makes a stable electricity supply critical, abandoning nuclear power was seen by many experts as a reckless choice. Korea’s nuclear ecosystem was severely disrupted, and its nuclear industry set back by years. According to a study by the Nuclear Policy Center at Seoul National University, revenue from the sector fell by 41.8 percent during Moon’s five-year term.

Vice Minister of the Interior and Safety Kim Min-jae, center, speaks while presiding over the first meeting of the government task force on consumer relief coupons at Government Complex Sejong in Sejong on June 23. [NEWS1]

This raises an important question: Was the nuclear phaseout truly what a majority of the public wanted at the time? In the 2017 presidential election, which followed the impeachment of President Park Geun-hye, the topic of nuclear energy was barely debated. The election was held under unusual circumstances, with the conservative bloc fractured and public anger over the scandal overwhelming other policy issues. Moon, the Democratic Party (DP) candidate, won with 41.08 percent of the vote, far ahead of Hong Joon-pyo of the Liberty Korea Party at 24.03 percent and Ahn Cheol-soo of the People's Party at 21.41 percent. Once in office, President Moon quickly moved to implement the nuclear phaseout.

This episode illustrates the winner-takes-all nature of Korea’s presidential system. Once elected, a president enjoys vast authority and often implements sweeping policies without broad public consultation. In some cases, these unchecked powers result in decisions that cause long-term damage.

The new administration of President Lee Jae Myung has introduced a 20 trillion won ($14.67 billion) supplementary budget just two weeks after taking office. Of that, 13.2 trillion won is earmarked for a “household recovery spending coupon” to be distributed to all citizens, regardless of income. Depending on income level, recipients will receive between 150,000 and 520,000 won. Even Korea’s wealthiest, including Samsung Electronics Executive Chairman Lee Jae-yong and SK Group Chairman Chey Tae-won, are eligible for the minimum amount.

This rapid shift is especially striking given that many government officials had opposed such large-scale spending under the previous administration due to concerns over fiscal deficits and rising national debt. But with the change in leadership, resistance quickly dissolved. The bureaucracy submitted the new proposal with little pushback. As always, civil servants respond to the will of those in power.

While the opposition parties have criticized the plan, the DP, which holds a majority in the National Assembly, is expected to pass it. Still, it is worth asking whether this kind of broad cash disbursement reflects public consensus. The June 3 presidential election was not a referendum on universal relief payments. Rather, it was about holding those responsible for unconstitutional martial law accountable and restoring democratic order. Voters also wanted a turnaround in the struggling economy.

Whether the public actually supports direct cash payments remains debatable. In a February poll by Gallup Korea, 55 percent of respondents opposed the idea of doling out 250,000 won per person in recovery coupons, while only 34 percent supported it. However, a more recent survey conducted by Weekly Chosun from June 13 to 15 showed 64 percent in favor and 34 percent against. Given the differing polling agencies and contexts, a direct comparison is difficult, but the shift likely reflects a “let’s give them a chance” sentiment following the president's inauguration.

People browse shops in Namdaemun Market in Seoul on June 22. As the government moves forward with its second supplementary budget, which includes distributing household recovery coupons, attention is focused on whether the payments will effectively boost consumption. Studies on Covid-19 relief payouts suggest that new spending generated by such subsidies typically ranged between 20 and 40 percent. [YONHAP]

Most economists agree on the need for a strong fiscal role in reviving the economy. The debate is over how that money should be spent. Direct payments are often seen as ineffective. A 2020 analysis by the Bank of Korea found that government consumption — spending directly on public services or employment — was nearly three times more effective than transfer payments. Similarly, a study by the Korea Development Institute on the first round of Covid-19 emergency payouts found that the actual increase in consumption was only 26.2 to 36.1 percent of the total amount distributed. In many cases, households spent the government handouts but held back on their originally planned purchases, resulting in a limited overall impact on consumption.

Despite this, the Lee administration has opted for large-scale, cash-based relief. It’s no surprise that some have dubbed it a “congratulatory payout” for winning the election.

Both the nuclear phaseout and the universal handout share a common feature: policies enacted without sufficient public deliberation. In both cases, the decisions were made by administrations that rose to power following a national crisis — one after impeachment, the other after martial law. And both risk leaving long-term burdens on the Korean economy. If the phaseout destabilized the energy sector, the handouts may go down as the moment Korea's fiscal discipline began to erode. The country is now stepping onto unfamiliar ground — what some are calling “cash-driven growth.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.