The Korea Herald


[Editorial] GNP’s new vision

By 류근하

Published : July 22, 2011 - 19:18

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The Youido Institute, the think tank of the ruling Grand National Party, has released a report to outline a new vision for the party. The document, unveiled Wednesday, signals the beginning of a major debate within the ruling party over the revision of its platform in preparation for the general and presidential elections slated for next year.

Thus far, the GNP’s vision has been “the advancement of Korea.” It defined its mission as catapulting Korea into the ranks of the world’s most advanced and industrialized nations. For this, it has pursed a growth-first policy in the belief that economic growth would improve the welfare of the general public.

The vision report calls for a shift in the party’s policy focus from growth to welfare. As the party’s new vision, it suggests the creation of an “advanced welfare state.” To attain this new vision, it lists 10 major policy tasks, including tax increases to finance welfare expansion.

The first task calls for doubling the nation’s per capita GDP to $40,000 by 2020. To reach this ambitious target, Korea needs to boost its potential growth rate from the current 4.5 percent per year to above 5 percent.

Another main challenge is enhancing Korea’s welfare level to the OECD average by 2020. This means expanding the nation’s social expenditure from the current level of 9 percent of GDP to 20 percent over a period of eight years.

To do this, an increase in people’s tax and social security burden is inevitable. Specifically, the report proposes that the public’s tax burden be raised from the present 20 percent of GDP to 25 percent by 2020 and their social security contributions from the current 5.6 percent of GDP to 10 percent.

Why is the GNP exploring a welfare-oriented vision? As the main reason, the report cites the urgent need to address the difficulties of the mid- and low-income families, which were caused by the global economic crisis and worsening social polarization.

Yet this is not the true reason. The real impetus behind the new vision comes from the welfare offensive of the main opposition Democratic Party. In recent local and parliamentary by-elections, the DP scored victories thanks partly to its pledges of universal welfare benefits, for instance, free school lunches for all students.

Gripped by fears of losing the coming two key elections, the ruling party has since sought to reduce the lure of the DP’s welfare promises. Two approaches have emerged. One is to accommodate the opposition party’s welfare policies, which would make the two parties indistinguishable to the electorate.

The other approach is to challenge the validity of the DP’s welfare initiatives. Seoul Mayor Oh Se-hoon adopted this path when he decided to put the free school lunch policy to a poll of Seoul residents. Oh is convinced that Seoul citizens would vote against the free lunch scheme, thus putting the brakes on the rising tide of welfare populism in Korea.

The vision report follows the first approach. One cannot blame a political party for taking a page from its rival’s playbook, given that there are no intellectual property rights on policy proposals. Yet the GNP would be hard pressed to justify its emulation of the DP’s welfare policies, since it has thus far attacked them as examples of reckless populism.

The fact that the report has borrowed ideas from the DP also detracts from its value. The institute said it took more than six months to write the vision paper, based on input from some 20 GNP lawmakers and about 100 outside experts. But it did not get the attention that such hard work deserves.

The party has recently created confusion over its identity by flirting with left-leaning policies diametrically opposite to President Lee Myung-bak’s MBnomics. Now it needs to clear the confusion and forge a new identity through a heated debate on the suggested vision. Our hope is that the party’s leaders are wise enough to put long-term national interests before its short-term political gains. But this may be too tall an order for a party in an identity crisis.