[From Kwanghwamoon] Economic policy borders on irrational

There is a play titled, "The Bald-headed Singer." However, those who purchase tickets with the expectation of seeing a bald singer come on stage will be disappointed -- simply because she doesn`t.

Those watching the play, "Waiting for the Climax," also will need enormous patience. The play is nothing more than a long series of chatter by those waiting for the thing called climax. The story line is hard to follow or downright unfathomable. The play closes without a climax making an appearance.

The two are examples of the irrational plays that were the rage at one time in France. The plays were used as a tool to journey into the irrational elements of this world that are difficult understand with the rational mind.

These days, the Korean economy seems to have become one such irrational play. Many of economic experts stress that for the Korean economy to survive, restructuring must not be delayed. The government officials say that we will most assuredly follow through on the four-pronged reform of the financial institutions, corporations, state-owned enterprises and labor.

However, all this dazzling rhetoric is nothing more than paper tigers when faced with harsh reality. The supposed high sounding restructuring really is not much more than employee reduction. It is not a much of a wonder to see those who have lost their jobs adamantly opposing the restructuring. Regardless of the industry, whether in the banks, nonviable businesses, state-owned enterprises or even government offices, all who are directly targeted by restructuring have become highly sensitive. Without persuading these individuals, restructuring is bound to fail.

Soon after the foreign currency crisis, restructuring seemed unavoidable and meant survival. However, things have changed. The government already had popped the champagne cork by declaring that we had graduated from IMF management. The government poured public funds into nonviable banks to resuscitate them. Nonviable businesses found a haven under the corporate workout umbrella and were injected with life-saving bank support. Special-interest groups began to pressure the weakened government. The populist policies, feeding on the adulation and flattery of the masses, began making their appearances. The virtuous "sharing of the burden and pain" simply began to fade to black.

The statements of the policy makers are incomprehensible, much like the dialogues of the irrational plays. The people have begun to tighten their belts in fear of the uncertain. As they have cut down on spending, the merchants are in a bind. The factories churning out the goods watch as their inventories grow and consider laying off workers. Many businesses have skipped making plans for the coming year but tightly hold on to their liquid assets. The pessimism pervading society is worsening Korea`s future.

How can such a vicious cycle be stopped? The words and pledges of the leadership of Korea must be clear and plain. The politically tainted policies that go against economic theories and soundness must not be forced on the economic team with the excuse of them being the wishes of the people. The short-term populist policies must be abandoned. To state one day, full speed ahead with reform, then the next, but not too drastically, only confuses the nation as it awaits.

For the Korean economy to truly find an escape, the restructuring must face the all-important coming of age. The coming of age for the restructuring will be the next six months.

Although the patient might fiercely refuse the life-saving operation in fear of the pain, the doctor must wield the knife, with the assurance that a clean and timely operation could lead to a full recovery. It is time to put on end to the meaningless plays of irrationality.

Koh Seung-Chul, economic editor

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