FINANCE

South Korea’s ‘Barney Sanders’ has spoken of universal basic income before the vote


A universal basic income (UBI) of more than 600 a month is moving closer to reality for South Koreans as leading presidential candidates pledge to issue radical policies to tackle growing inequality.

UBI – a government program through which the state pays unconditionally a monthly stipend to everyone – is seen by some economists as a way to alleviate poverty and destroy a bureaucracy inflated by liberals. But critics say the policy is unrealistic and intolerable.

Lee J-Myung, the winner of the ruling party’s primary race this weekend, has vowed to introduce a growing policy over his five-year term if he wins the presidential election in March, which will probably make UBI the first Asian nation to become a nation.

Compared to left-wing U.S. Senator Barney Sanders, Lee said, “Real independence is possible only when basic living conditions are ensured in all areas, including income, housing and financing.”

He added that South Korea should be a country where injustice and inequality are resolved and there are plenty of opportunities and dreams through sustainable growth.

Under Lee’s plan, all South Koreans will initially receive a Won1m ($ 840) annual payment that will continue to expand year after year until they reach a monthly amount of Won500,000 (420).

The left-wing Democratic Party’s Lee and the governor of the country’s most populous province are building a popular platform based on aggressive welfare spending, low-cost public housing and cheap loans for the poor.

But the 56-year-old is not alone in finding tested ideas to address the chronic problems he has failed to address: rising education and housing costs, rising household debt, youth unemployment, unequal old age poverty and the world’s lowest fertility rate.

“As the health crisis continues, people agree that we need a strong social security net. So they are slowly adopting some radical platform that has long been seen as a socialist concept, ”said Park Chong-hun, head of research at Standard Chartered.

Kim Dong-eun, a popular former finance minister who is trying to model himself as French President Emmanuel Macron, wants to go further and completely overturn the county’s legal system.

“Korean law only prescribes legal things so the rest is considered illegal. But like many other developed countries it should be different. He believes overhauls are needed to regulate and unlock innovation.

Kim is a working bureaucrat who lifts herself out of poverty after discovering a discarded civil service exam book at a waste point. But now he wants to abolish entrance exams to improve the quality of the country’s bureaucracy, which could break a ban on lifelong security promised to government employees.

Conservative opposition candidates are also adopting a giving mood, moving away from their more rigorous economic and market-oriented tendencies.

They have sharpened their focus on property prices, a central symbol of South Korea’s growing economic polarization.

Despite at least 20 new policy initiatives designed to combat price rises, apartment prices have almost doubled since President Moon Jae-in took office in 2011.

With the property of many middle-class families thrown out of the market, the average price of an apartment in Seoul has reached 1 million, few Koreans might think that is the limit.

Former chief prosecutor and leading opposition candidate Eun Seok-yul is trying to attract young voters with a promise of a 50,000-unit housing unit. Other candidates have proposed a wide range of development projects, including the relocation of a military airport just south of the capital to increase the supply of land for housing.

Critics, however, have questioned the sustainability of the plan, citing funding problems.

Paul Choi, an economist at CLSA, an investment group, said Lee’s victory could provide a short-term “steroid effect” but risks the long-term health of Asia’s fourth-largest economy.

The focus on inequality has changed unprecedentedly since five years ago, when Moon came to power behind a massive corruption scandal involving indicted former President Park Geun-hye.

A strong response to growing exports and healthcare helped South Korea achieve one of the fastest recovery in the world from an epidemic-induced recession last year. But senior officials have acknowledged that they have not been caught at the rate at which the gap between rich and poor has widened during the coronavirus epidemic.

Shin Yul, a professor of politics at Myongji University in Seoul, said next year’s elections appear to be “influenced by the population.”

“With a lot of people in economic trouble, they want a charismatic leader with a strong image,” Shin said, “no matter how admirable their platforms are.”



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