Time Has Long Past to Defuse Time Bomb
It's hard to love your neighbor when you find it increasingly hard to make your living, while the other gets ever richer. Particularly so if much of this is due to one-sided systems and policies, not difference in abilities and endeavors.
A recent National Statistical Office report showed the wealthiest 20 percent of Koreans earned 8.68 times more than the bottom fifth in the first quarter of this year. The gap in monthly income has reached an all-time high, up from the comparable figure of 8.14 times a year ago.
The biggest reason is of course the global recession, which pushed a large number of people on the lower rung of the employment ladder into joblessness and cut into the earnings of those remaining.
In Korea, however, this is not a new but an old problem tracking back at least to a decade ago, when the country was hit by the worst financial crisis along with some of its Asian neighbors. The reason for the downfall of deceased former President Roh Moo-hyun as a politician could also be found in his failure to narrow the widening income disparity, resulting in bipolarization of wealth, amid what he termed ``leftist neo-liberalism."
As the Koreans are belatedly finding anew, the late Roh at least tried to work for the good of the working-class. This seems not to be the case of his successor, however, as shown by not just the ever-widening economic gulf, but also most of the policies he has adopted over the past 16 months. Even during the transition days, signs of his sharp turn to the right were all too apparent.
Experts share the views taxation is the most powerful policy tool in reallocating people's wealth, but President Lee's most visible step in this regard was to slash taxes for multiple-property holders, broadening further the wealth gap and deepening the sense of isolation and relative deprivation among the mid- to low-income brackets.
On the other hand, the ``business-friendly'' Lee administration is attempting to lower the legal minimum wage of 4,000 won ($3.2), increasing the portion of workers receiving below minimum wages to 14 percent as part of its policy to make the labor market more flexible.
All these policies favoring the haves aggravate the despair of the have-nots, possibly turning them toward political extremism and adding social strain. A bigger problem is, such unilateral measures do not ensure the success of the government's ``growth-oriented'' policy in the long term. Tax cuts directed toward the top 1 percent of the wealthiest people are not translated into consumption, unlike those provided to poorer people.
This is not to say the Lee administration has done nothing for the underprivileged classes, but more than 10 government packages announced for this purpose were little more than a patchwork of makeshift steps, not enduring and fundamental ones. One has to look no further than the recent OECD report, which ranked Korea at the bottom of 30 member countries in how effective government's spending was in improving income equality.
Most working-class Koreans do not want separate welfare policies for them but a shift of focus in economic policies to more equitable one. If President Lee fails to realize and materialize this, his slogans for national unity and harmony will ring hollow for a very long time.
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