[News analysis] Why Yoon’s war on “vested-interest cartels” is bound to fail

Posted on : 2023-07-16 09:41 KST Modified on : 2023-07-16 09:41 KST
Eradicating “vested-interest cartels” has become the president’s hobbyhorse, but what exactly does he mean?
President Yoon Suk-yeol speaks at a meeting on the economy and livelihoods for the second half of 2023 at the Blue House guest house on July 4. (Yonhap)
President Yoon Suk-yeol speaks at a meeting on the economy and livelihoods for the second half of 2023 at the Blue House guest house on July 4. (Yonhap)

South Korean President Yoon Suk-yeol’s persistent feud with what he refers to as “vested-interest cartels” — that is, groups that collude to monopolize government subsidies and other privileges in society — seems to have become a perverse obsession.

While handing out credentials to new vice ministers in a luncheon on July 3, Yoon said, “This is an anti-cartel administration. We will show no mercy in our fight with the vested-interest cartels. Democratic society is undermined from the outside by totalitarianism and socialism and from the inside by corrupt cartels.”

And here’s what Yoon said during an emergency economic and livelihood meeting on July 4 aimed at setting the course for economic policy in the second half of the year: “We must thoroughly dismantle systems in which rights and privileges are distributed through an exclusive cartel instead of being earned through a fair and legitimate system of compensation. These vested-interest cartels may look benign at first glance, but they are designed to make it easy and convenient to plunder the people on an ongoing basis. As such, no public official should ignore the cartels or hesitate to combat them.”

“We need to examine the funds that are being unfairly pocketed by vested-interest cartels — including monopolistic or semi-monopolistic structures in specific industries and groups working to corner government subsidies — and eliminate them through zero-based budgeting,” the president said.

“Cartel” started out as an economic term. The dictionary defines it as “a monopoly formed when enterprises in the same industry reach an agreement about pricing, production or sales so as to limit or ease competition or an agreement of that sort.”

The meaning of the term has been diluted over time such that it now means “a system of unfair collusion designed to monopolize profits or maintain vested interests.” Criminal organizations that produce and sell drugs are known as cartels, for example.

The first time Yoon used the phrase “vested-interest cartel” was when he announced his candidacy for presidency on June 29, 2021. The phrase appeared three times in that announcement, functioning as an overarching principle for the entire message.

“A small number of vested-interest cartels whose interests are entangled with the administration are building a food chain by which they seek to privatize power, eschewing any sense of responsibility or ethics.”

“If power does not change hands, this country will fall under the thumb of the corrupt vested-interest cartels and the rabble-rousers whose so-called reforms are malicious and destructive measures and whose so-called democracy amounts to dictatorship and autocracy, resulting in a long period of public suffering.”

“The current administration is under the powerful protection of the vested-interest cartels and the [Democratic Party’s] domination of the National Assembly.”

When Yoon declared that uprooting those vested-interest cartels was the most important reason he was running for president, he didn’t specify whom or what he was referring to. But as president, Yoon has applied the label of vested-interest cartel to a series of different institutions: Democratic administrations, the renewable energy industry, activist groups, the Cargo Truckers’ Solidarity Division, the Korean Construction Workers’ Union, vested interests that oppose his three signature reform initiatives, and education officials who are in cahoots with the private education industry.

And now, Yoon has taken a cabinet reshuffle as a chance to define the very administration he leads as an “anti-cartel administration” in what amounts to a declaration of all-out war against vested-interest cartels.

Yoon stumps on the campaign trail in Anyang, Gyeonggi Province, on March 7, 2022. (pool photo)
Yoon stumps on the campaign trail in Anyang, Gyeonggi Province, on March 7, 2022. (pool photo)
Buoying poll numbers by bashing vested-interest cartels

Vested-interest cartels function as Yoon’s ontological foundation. That’s going to need some unpacking.

Yoon spent his career as a public prosecutor. And not just any old prosecutor, but one in the department of special investigations, personally handling investigations and indictments for major crimes. He has been ignorant of both politics and policies for his entire life.

Given that background, Yoon needed a clear-cut rationale for his presidential run. The rationale he settled on was apparently none other than the vested-interest cartels. As a prosecutor from the department of special investigations, he had a proven knack for catching criminals. Simply put, if there were no vested-interest cartels, there would be no reason for Yoon to be president either.

Of course, I’m sure that’s not the whole story. Yoon’s rage against the vested-interest cartels appears to be sincere, at least on some level. But that raises the question of why Yoon bears such a grudge against them.

First is probably his sense of justice. Yoon’s friends have said he was unusually concerned with fairness, even as a child. There are accounts of him getting back at some classmates who had bullied a diminutive friend of his. That sense of justice probably only grew during his time in the prosecution service.

Some prosecutors (though not all, of course) develop a type of hero mentality through their work. They may see themselves as “apostles of justice” and believe they became prosecutors to fight the “forces of evil” wherever they may lurk.

Yoon seems to have fallen into that category of prosecutor. He may genuinely believe that he is the “good guy” carrying out justice and pursuing reform while the people and groups who oppose him (those “vested-interest cartels” of his) are all “bad guys.”

Second, Yoon may be motivated by some kind of psychological complex. The person who named him head of the Seoul Central District Prosecutors’ Office and then later prosecutor-general was Moon Jae-in, the former president. Moon gave Yoon the second promotion despite the advice of major figures in the Democratic Party who said that back-to-back promotions can have unpleasant consequences.

Yoon is aware of all that, of course, which is perhaps why the prosecution service haven’t opened any cases against Moon Jae-in or even put him under investigation. At the same time, prosecutors have been recklessly investigating and indicting major officials in the Moon administration. In effect, the prosecutors seem determined to bring down everyone in the Moon administration, except Moon himself, for being part of a vested-interest cartel. Something’s very strange about that whole scenario.

So what’s going on here? Are we seeing the simultaneous operation of Yoon’s inferiority and superiority complexes for Moon Jae-in and his administration for appointing him to office and ultimately paving the way for his election as president? Is that psychological complex finding expression in his unwarranted fury and hatred of vested-interest cartels?

Yoon has only rarely criticized former Presidents Kim Dae-jung and Roh Moo-hyun, even though their policies on the economy, welfare, national security and foreign affairs were much the same as Moon’s. What’s going on with that? Does Yoon not have the guts to attack the two former presidents, who are both now deceased?

A third likely reason for Yoon’s vendetta against the vested-interest cartels is the general election coming up next year. While the polls are inconsistent, they do suggest that Yoon’s attack on vested-interest cartels is propping up his approval rating and the approval rating of the People Power Party while sowing division among voters.

Whatever the circumstances, a firm hand by the president is sure to galvanize the conservative base. That’s basically how Moon maintained a 40% approval rating amid the extreme political polarization at the end of his presidency.

Add to that the fact that Lee Jae-myung’s Democratic Party is mired in scandals — the Daejang neighborhood development case, allegations of buying electors’ votes in the party’s leadership election in 2021, and the scandal surrounding former lawmaker’s speculative investment in virtual currency — and it makes sense that Yoon’s feeling confident in his party’s ability to pull off a victory at the polls in next year’s election.

Yoon’s declaration of war could thwart reform push

Will Yoon be able to win his war against vested-interest cartels? I’m not convinced, and I have two reasons for believing so.

First, he’s picked the wrong target from the get-go. The vested-interest cartel is a fictional concept that exists only in the president’s own head.

If there are irregularities in subsidies to renewable energy projects, civic organizations, labor unions, or elsewhere, then all that needs to be done is to correct those irregularities. But labelling the entire renewable energy industry, civil society organizations, and labor unions as vested-interest cartels is a fool’s errand.

Name-calling is bound to prompt strong backlash from the parties involved. Let’s also not forget that Korea is a country of the rule of law, meaning that such cartels aren’t even realistically possible. Just because the president labels a certain group a vested-interest cartel doesn’t make it one.

Second, top-down reforms by a country’s leadership have major side effects. Park Chung-hee’s regime, which came to power in a coup, purged political thugs to restore public confidence. The thugs disappeared, but soldiers and the Korean Central Intelligence Agency took their place.

Chun Doo-hwan, who also came to power in a coup, set up the Samcheong re-education camp in the name of social cleansing. In reality, it was a concentration camp rife with human rights abuses.

President Roh Tae-woo waged his own “war on crime,” and while it yielded results, it also brought the prosecution service to the forefront of power. Prosecutors have since grown in strength and eventually swallowed the regime whole under Yoon.

President Kim Young-sam tried to “rectify history,” President Kim Dae-jung tried to “build a second founding of our nation,” President Park Geun-hye tried to “correct the abnormal,” and President Moon Jae-in tried to “investigate corruption.”

By and large, they failed. This is because they forcefully pushed a one-sided reform only to divide the country and the people.

Yoon has made labor, pension, and education reform a top national priority. Will removing the labor vested-interest cartel lead to labor reform? Will removing the pension vested-interest cartel lead to pension reform? Can we reform education by removing the education vested-interest cartel? Can prosecutorial investigations lead to reform?

Simply put, no.

Reform is creative, not destructive, and labor, pension, and education reform in particular can only happen through dialogue and compromise. Only if stakeholders, the government, and the ruling and opposition parties form a social dialogue body and then reach a social compromise can they succeed.

I predict that Yoon’s hasty declaration of war against vested-interest cartels will only hinder reform.

What do you think?

By Seong Han-yong, senior editorial writer

Please direct questions or comments to [english@hani.co.kr]

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