I don’t only mean the pitiful showing by Lee Myeong-bak’s supporters last Friday. Monday’s online Korea Times says that 8000 rallied, some of them demonstrating outside the Korean Broadcasting System headquarters to complain that KBS was being unfair to President Lee:
The protesters took issue with the country's television broadcast companies -- the publicly funded Korean Broadcast System (KBS) and the Munhwa Broadcasting Company (MBC) -- and the way they have been portraying the beef import issue and the danger of mad cow disease. The groups claimed that both KBS and MBC were involved in biased reporting and in inflating and exaggerating the issue associated with U.S. beef.
The representative from “Free Citizens' Alliance of Korea” said that KBS and MBC have been unfairly targeting President Lee and his administration. The broadcasters needlessly incited young people with their exaggerated claims regarding mad cow disease, the representative said.
”The Lee administration is taking its first steps. It's only 100 days old. Broadcast companies shouldn't be involved in criticizing this fledgling administration. What they are doing is tantamount to interfering and undermining national affairs,” the group said.
The protesters were particularly upset at MBC TV's popular news magazine program ‘PD Notebook,’ which in April aired a segment on the safety ofMaybe this guy was correct, and Koreans expect their media to toe the government and corporate party line. But then he’d also be wrong, because the Korean media aren’t marching in perfect lockstep behind Lee. It would be fun to watch “GI Korea” take on the Korean veterans on this issue, telling them that their media should interfere and undermine national affairs. (I’m still wondering how these folks felt about the attempt to remove Lee’s predecessor, Noh Mu-hyeon, from office by impeachment in 2004.)
cattle. Critics of the program argue that the segment exaggerated dangers associated with U.S. cattle. Some protesters chanted slogans like “Let's destroy MBC's PD Notebook” and “Stop unfair reporting.” U.S.
You’d never guess this media rebellion from the Korea Herald and Korea Times, though. This morning’s Herald features an anonymous op-ed (“What’s behind the U.S. beef protests”) denouncing the vigils as the work of – you guessed it – a bunch of radical leftists:
But beef imports could well be a surrogate issue. The real problem underlying the current unrest is Lee's image as a conservative leader intent on undoing the past government's policies, ranging from relations with North Korea to privatization and deregulation. His hard-line policy on the North, giving food aid only when it makes progress on the nuclear issue, has fired up the radical community as well as the opposition United Democratic Party. His new line on education policy, emphasizing quality control and elitism over left-wing school teachers clamoring for "equal opportunity" and "egalitarianism" has alienated teachers and students. Trade unionists and farmers have joined hands to oppose market opening, privatization and restructuring that would hit their interests. …
At home, no less worrisome are the implications of Lee's failure to push through robust economic reform. The swelling protests have made it impossible for him to trim the size of the civil bureaucracy, deregulate the market and promote more privatization and corporate restructuring to improve the country's overall competitiveness. On these issues, the government and protesters stand far apart.The writer concedes that Lee’s administration is riddled with cronyism and corruption, which only goes to show that Korea’s fabled “crony capitalism” can get along just fine with U.S. economic strong-arm policies.
The Korea Times goes further. It has an interview, titled “Korea’s image, brand in trouble” with a grandfatherly white guy named Dominic Barton, the Chairman of McKinsey & Company Asia. My ears perked up when I saw Korea referred to as a “brand.” Some may remember how, as the US waged aggressive war in the Middle East, it hired PR flacks to improve our “image” there and promote loyalty to “brand America.” (It hasn’t worked.)
More in sorrow than in anger, speaking as one Korean to another, Barton opined that Lee is the right guy to sell Brand Korea to the rest of the world (read: multinational corporations and financial traders, which are only a rather small, if disproportionately powerful, part of the rest of the world).
“Other countries have a choice regarding which companies and countries they work with. They will not work with our companies if our image is that of being rough, tough and aggressive,” he said.But Barton bravely urges Lee not to be cowed by the public.“I don't think a leader should run the government based on opinion polls,” he said. Barton apparently likes Lee’s stance as CEO of Korea, Inc., even if most Koreans don’t.
He pointed out that people outside of Korea do not have the context to understand issues here, such as the U.S. beef issue and protests against the free trade agreement (FTA).
”Sometimes it can be good to have discussion and lively debate, but if it's not in the right context, people may say, 'oh my god what's happening there,'” he said.
Korea used to be known as a country of the "miracle" due to its rapid transformation from a war-ravaged agricultural economy into a manufacturing powerhouse, but it has lost its glorious image and is now turning into a republic of "protest" and a country of "xenophobia." …
The global consultant's view is not a groundless concern. Some indicators suggest that foreigners have turned their back on Korea over the past years amid the falling image of the world's 13th largest economy. ...
Barton, who is chairman of the International Advisory Committee to the President of South Korea on National Future and Vision, said that Lee and his administration are going in the right direction in the long term.
”He is the guy who can make big changes that will benefit the country, but things will not change overnight,” he said.
”I think from an external point of view, in the global scene, it's very positive because he is seen as very open, very market-oriented, very interested in different ideas, very determined to make some moves,” he added.
His assessment on Lee and his team is in stark contrast to Lee's popularity that has recently hit rock bottom, battered by the U.S. beef import issue. …
To read this stuff, you’d think that what Korea needs is more deregulation, privatization, and “opening” to foreign ownership, and that those multinationals and financial markets only have the benefit of the Korean people in mind. That’s open to doubt. Just a decade ago, the Korean government (along with several other countries) was forced to implement such policies, with disastrous results. I recently read Naomi Klein’s 2007 book The Shock Doctrine (Holt), which recounts the tale and puts it into depressing global context.
Korea, like other “Asian Tigers”, had maintained trade and finance barriers to protect itself against destructive speculation. It was these policies, at odds with “free trade” mythology, that produced the “economic miracles” for which the Tigers were famed. (The US, Europe, and Japan didn’t achieve their economic power by granting unimpeded access to their markets either. Generally a country only abandons protectionism in favor of “free trade” when it deals with a weaker country it can expect to overwhelm – and even then, as with the US, it keeps plenty of barriers up.) Says Klein,
The situation did not please Western and Japanese investment banks and multinational firms; watching Asia’s consumer market explode, they understandably longed for unfettered access to the region to sell their products. They also wanted the right to buy up the best of the Tigers’ corporations – particularly Korea’s impressive conglomerates like Daewoo, Hyundai, Samsung and LG. In the mid-nineties, under pressure from the IMF and the newly created World Trade Organization, Asian governments agreed to split the difference: they would maintain the laws that protected national firms from foreign ownership and resist pressure to privatize their key state companies, but they would lift barriers to their financial sectors, allowing a surge of paper investing and currency trading.The Asian economic crisis of the late 1990s was the result of greater openness to outside interests. As Korea plummeted into a catastrophic trade deficit, the International Monetary Fund, a body whose ostensible function is to prevent such disasters, stood by and watched while investors rubbed their hands with glee:
In 1997, when the flood of hot money suddenly reversed current in Asia, it was a direct result of this kind of speculative investment, which was legalized only because of Western pressure [page 267].
Top investment analysts instantly recognized the crisis as the chance to level the remaining barriers protecting Asia’s markets once and for all. [Jay] Pelosky, the Morgan Stanley strategist, was particularly forthright about the logic: if the crisis was left to worsen, all foreign currency would be drained from the region and Asian-owned companies would have either to close down or to sell themselves to Western firms – both beneficial outcomes for Morgan Stanley. “I’d like to see closure of companies and asset sales. … Asset sales are very difficult; typically owners don’t want to sell unless they’re forced to. Therefore, we need more bad news to continue to put the pressure on these corporates to sell their companies” More bad news duly arrived. When the IMF finally got around to doing something, it imposed harsh conditions on Korea and other countries that needed aid: it required Korea’s banking industry to downsize by 50 percent (later amended to 30 percent), demanded deep governmental budget cuts, and other austerity measures. (According to Klein, the head of the IMF negotiators later admitted that the crisis in Korea was unrelated to government overspending , which means that the downsizing wasn't economically necessary.) In addition,
the end of the IMF negotiations coincided with scheduled presidential elections in which two of the candidates were running on anti-IMF platforms. In an extraordinary act of interference with a sovereign nation’s political process, the IMF refused to release the money until it had commitments from all four candidates that they would stick to new rules if they won. With the country effectively held at ransom, the IMF was triumphant: each candidate pledged his support in writing. Never before had the central Chicago School mission to protect economic matters from the reach of democracy been more explicit: you can vote, South Koreans were told, but your vote can have no bearing on the managing and organization of the economy. (The day the deal was signed was instantly dubbed Korea’s “National Humiliation Day” .)This might be forgettable, though not forgivable, if the IMF program had worked – but it didn’t. Instead of recovering, the financial markets panicked anew, and Korea’s economy was pushed even further into the hole. “Korea was losing $1 billion a day and its debt was downgraded to junk bond status” (Klein, 272). Unemployment tripled by 1999, the suicide rate continued to climb, and the number of Koreans identifying as middle-class dropped by nearly half, from 63.7 to 38.4 percent. Nor has the Korean economy recovered to this day:
Employment rates have still not reached pre-1997 levels in Indonesia, Malaysia, and South Korea. And it’s not just that workers who lost their jobs during the crisis never got them back. The layoffs have continued, with new foreign owners demanding ever-higher profits for their investments. The suicides have also continued: in South Korea, suicide is the fourth most common cause of death, more than double the pre-crisis rate, with thirty-eight people taking their lives every day [Klein, 276].If Korea’s people suffered, the international business community made out like bandits:
The hot money may have been spooked by the IMF’s drastic measures, but large investment houses and multinational firms were emboldened.“Of course these markets are highly volatile,” said Jerome Booth, head of research at London’s Ashmore Investment management. “That’s what makes them fun.” These fun-seeking firms understood that as a result of the IMF’s “adjustments,” pretty much everything in Asia was now up for sale – and the more the market panicked, the more desperate Asian companies would be to sell, pushing their prices through the floor .Klein details how multinational companies gobbled up Asian corporations at bargain-basement prices (274-276), with “186 major mergers and acquisitions of firms in Indonesia, Thailand, South Korea, Malaysia, and the Philippines … in a span of only twenty months” (276). As a result, she says, not only was there public rage against the IMF and the WTO, but governments revolted too. In Seattle in 1999, “developing countries formed a voting bloc and rejected demands for deeper trade concessions as long as Europe and the U.S. continued to protect and subsidize their domestic industries” (278).
Emboldened by the way Bechtel and Halliburton have cleaned up in Iraq, and the boom in what Klein calls “disaster capitalism” (Hurricane Katrina, the December 2004 tsunami), the dogs of globalization are yapping at Korea’s heels again. With Korea’s recent history in mind, I have to wonder how Dominic Barton can make the recommendations he does. He must know the disastrous effect such policies had, not only in Korea but in much of Asia, ten years ago. To be charitable, Barton’s audience is not the mass of Koreans but the elites, the CEOs and crony capitalists who rode out the 1998 crisis with a minimum of pain. (He’s also entangled in what I’d call a conflict of interest, since he’s chairman of a euphemistically titled advisory group to President Lee and the head of a firm doing business in Korea. The wolf should not be guarding the sheepfold.) It isn’t that Barton wants ordinary Koreans to suffer; they just don’t show up on his radar.
But they show up on mine. When I see people (mostly neatly dressed and dignified) hawking trinkets for a dollar apiece on the subway; or a tiny old woman sitting silently next to a basket of gum she’s trying to sell; or when I eat in a hole-in-the-wall restaurant run by a family whose middle-aged father seems glum but dutiful; or when I see a sixty-something woman mopping a subway platform, wearing a pearl necklace under her smock – then I wonder where they were and what they did ten years ago, before the deluge.
Koreans (and I don’t mean the former Daewoo Group chairman who was just evicted from his Seoul Hilton penthouse, which he was leasing for 31 cents a day – he’s not going to end up sleeping under a bridge) are in a difficult spot. If they defy US pressure for the Free Trade Agreement (and both Obama and McCain have vowed to keep up the pressure), they’ll be punished and their economy will suffer. If they give in to US pressure, their economy will suffer anyway. But they’re right to reject the advice of people like Dominic Barton and the anonymous op-ed writer for the Korea Herald, who may have the best of intentions but as Korea’s recent history shows, are lethally wrong.