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[Editorial] Responsibility for Korea’s Soaring National Debt

[Editorial] Responsibility for Korea’s Soaring National Debt

Posted November. 30, 2005 07:19,   


The real current account deficit that reached 3.6 trillion won a year ago increased to 11.4 trillion won this year in late September. The estimated national debt for this year is a staggering 248 trillion won. As the numbers show, the country’s finances are showing signs of weakening.

The act of increasing government expenditures without taking into account the public’s capacity to handle larger tax burdens can be attributed as the main reason for the current account deficit. The government’s reckless and ineffective expenditures fixate a vicious circle of increasing budget deficits. It is not uncommon to see trillions of won being wasted to make up for a national project not thoroughly revised. Why else would the Board of Audit and Inspection point out that the government “conducts its grand public policies and projects using the customs and systems of the old development era”?

The Korea Forum for Progress, a non-profit organization with ex-prime ministers and deputy prime ministers of Finance and Economy on its board, picked the re-establishment of financial soundness as Korea’s most urgent agenda. It insists on cutting general account budgets by 10 percent within two years, and re-examining national projects.

The Korea Development Institute also advises a reduction in government expenditures. It believes that national finance has reached the danger zone, and assesses the increasing size of the government as the factor for the slump in the private sector.

Two days ago, the National Assembly started its deliberations on the details of the budget report for 2006. The Grand National Party took a step back from its initial claim to cut down expenses by 8.9 trillion won, claiming that “cutting expenses by even three trillion won would be a success.”

Members of the Uri Party do nothing but shout “budget cuts are absolutely impossible,” and both the leading and opposition parties seem too focused on “generously” securing local budgets for next year’s regional elections to address anything else. Any hope for help from the political side in keeping the extravagant government in check seems gone, with a heavy burden left on the shoulders of our people.

The time has come for the people to stand up for themselves. A firm, unified stance against a government that simply increases tax burdens to make up for its failures in managing national finance is inevitable. Voters, who are also taxpayers, must not neglect to memorize and judge the government, not to mention those parties and politicians who think little of its people’s taxes.