[Editorial] President Roh’s Unrealistic Perception of the Economy

President Roh Moo-hyun said yesterday in a meeting with officials of local newspapers, “The government has effectively dealt with the economic crisis,” and, “As far as economic fundamentals and future competitiveness are concerned, the participatory government has been doing better than our predecessors.” He also stressed that “we have adhered to principles and employed regular tactics to boost our economy.” But President Roh’s self-assessment of running the economy halfway in his five years in office is far from what the public is thinking.

Even researchers with national policy institutes point out the “crisis of future competitiveness” as the fundamental problem facing our economy. Amid pessimistic forecasts that the real growth rate, which has been lower than some five percent of the potential growth rate, would stay around three percent next year, corporate facility investment, an indicator for future growth, grew only by 1.5 percent in the second quarter of this year. Production capacity of businesses, representing the basic strength of an economy, also grew a mere 2.3 percent over the period to post a record low in two years and nine months. All this is mainly attributable to the government as it has fuelled anti-market and anti-business sentiment, which in turn reduced confidence in our economy.

Polarization is getting worse although the government made tackling it a top priority. After it found that real estate polices – 20 in a series, all about regulation and ignoring market principles- failed to keep real estate prices under control, the government has offered to impose a heavy property tax as if to say “Never buy, sell, and own a house.” A question arises if the government can describe the move as regular tactics. The economy still shows no sign of improvement although the government executed supplementary budget earlier than scheduled to boost economy.

What is more troublesome is that the ruling party and senior public officials are fuelling misplaced optimism rather than conveying the suffering of the public to the president as they should be. “Self-assessment of the two and a half years” of the ruling Uri Party as “the first government to introduce and practice leadership based on principles” are enough to provoke public complaint that “we have nothing to depend on.”

Now the public understands from their experiences that “a government with empty slogans” only brings about suffering to them. The government must note that “unrealistic” perception of reality will produce unfortunate results to it.