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[Editorial] Priority on Stabilizing Livelihoods

Posted May. 29, 2008 08:59,   

한국어

Lee Hyo-yeol sells watermelons from his truck, and complains about his poor earnings. Though sales can reach 100,000 won for half a day of work, he takes only 10,000 won in profit. Many restaurant owners are considering closing up shop amid a rash of woes ranging from shrinking domestic demand to public fears over mad cow disease and the outbreak of bird flu. Fishermen have given up going out to sea due to surging prices of diesel oil, which have more than doubled from a year ago.

With economic conditions rapidly deteriorating and inflationary pressure piling, the working class is being pushed to the edge. People can barely earn a living due to runaway energy prices and rising inflation. Adding insult to injury, weakening consumption and growing unemployment are eating away at their earning prospects. When the economy slows down, ordinary people, who don’t have the wherewithal to cushion the blow, are hit hardest.

When Lee Myung-bak ran for the presidency last year, he pledged to reduce major living costs 30 percent if elected. He even elaborated on how he would do it with detailed figures. With a family of four spending an average of 1,482,000 won a month on expense such as gas, communications, highway tolls, medicine, private education and childrearing, he promised to reduce the figure to 440,000 won for an annual saving of 5.3 million won.

Instead, living expenses have gone up since the president’s inauguration. Only one pledge to decrease toll fees has materialized, and it’s unclear if other promises will be implemented. Though the government cut the fuel tax 10 percent in March, skyrocketing oil prices have negated the effect.

The government said yesterday that it is considering monetary support for the poor to help pay for electricity, heating and fuel, and expanding oil subsidies. But these measures are not enough to help the public, who are heavily burdened by soaring energy prices. The government has refused to cut fuel taxes further on the grounds that more reductions will decrease tax revenues and stimulate the unnecessary use of vehicles.

Considering the severity of situation, however, it is high time for the government to come up with fundamental solutions, including tax cuts. There is no need to worry about tax revenues. Enough taxes were collected last year that even drawing up of a supplementary budget is being mentioned. Tax cuts will help invigorate domestic consumption. If the government cannot rein in oil price hikes, it should adjust fuel taxes, which are among the highest in the world, according to changes in economic conditions. The government must focus its efforts on stabilizing livelihoods and easing the people’s pain.