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[Editorial] Inscrutable criteria

COVID relief splits people 88% to 12%; Justification weak, effect questionable

Under the 34.9 trillion won ($30.3 billion) extra budget bill passed last week to prop up the pandemic-battered economy, 88 percent of people will receive relief money while 12 percent won’t.

But there is no clear and convincing explanation on the grounds for the cutoff point of 88 percent.

At first, the government took a position that COVID relief cash should be offered to those in the bottom 70 percent income group. The ruling Democratic Party of Korea, which believes that a government decision to pay COVID relief checks to all people was of great help to their sweeping victory in the general elections last year, sought universal checks benefiting all citizens this time again.

After pushing and pulling over how many should receive relief money, the party, the Ministry of Economy and Finance, and the presidential office agreed last month to pay relief checks to those in the bottom 80 percent income bracket. Then, double-income and one-person households just above the boundary line lashed out at being excluded from the relief program. Surprised at their anger, the party included them, expanding the pool of recipients to 88 percent. Now not only those people just above the new boundary but also those in the 12 percent range are seething in anger. Eventually, a deformed criteria of 88 percent came into being. The unprincipled judgment standard split people.

As a result, conditions for those who qualify for the relief handouts have become complicated. Basically, the ministry decided to filter out 12 percent of people based on how much in national health insurance premiums citizens paid last month. Eligibility criteria will be further fragmented depending on other factors such as whether a household is single-income or double-income and how many members a household has.

Another issue of this quasi-universal relief payment is that a considerable number of people such as those who earn a stable income may qualify for the relief fund even though they are not so financially needy. If an affluent individual receives the same 250,000 won in relief money as a person in need, the practical value and effect of relief will fall.

Offering relief cash to those in the bottom 88 percent income bracket does not go well with current social distancing guidelines that were tightened amid the fourth wave of the pandemic. Mom-and-pop businesses, among others, are hit hardest by the guidelines. Relief funds would be best used when they are concentrated on those who need them the most.

If the coronavirus pandemic is prolonged, undoubtedly demand for the government’s relief aid will mount and the state coffers will dwindle. Under the extra budget, the government will spend about 2 trillion won repaying the national debt. However, the national debt is already snowballing to a hard-to-control level. It was 660 trillion won in 2017 when Moon began his presidency, but it is expected to rise up to 960 trillion won late this year and top 1,000 trillion next year.

At this speed, the government will likely be caught up in a vicious cycle of continuing to borrow debt to pay the debt. If the national debt is increasing this fast and tightens the screws on state budget, those in dire economic straits will find it increasingly difficult to receive substantial support from the government.

And yet, ruling and opposition parties passed the extra budget bill focused on distributing relief money practically indiscriminately. They are given to increasing fiscal spending with an eye on the presidential and local government elections next year.

The People Power Party will find it hard to shun criticisms for being inconsistent on COVID relief. The opposition party first argued for focused selective support for those damaged by the pandemic and social distancing. Then, its leader argued for benefiting all people. At last, it effectively got into line with the ruling party and the government. With elections drawing closer, both parties seem to be acting in unison when it comes to a matter of winning over voters. In their eyes, the future of the country seems out of sight.

By Korea Herald (koreaherald@heraldcorp.com)
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