[Column] Britain’s Yoon Suk-yeol, Korea’s Liz Truss

Posted on : 2022-10-18 17:07 KST Modified on : 2022-10-18 17:07 KST
The British prime minister’s early failures overlap with those of the Korean president in many ways
President Yoon Suk-yeol of South Korea and Prime Minister Liz Truss of the UK (AP/Yonhap)
President Yoon Suk-yeol of South Korea and Prime Minister Liz Truss of the UK (AP/Yonhap)
By Jung E-gil, senior staff writer

“You’re not at your best, are you Prime Minister?” a reporter shouted out as Liz Truss rushed to wrap up a press conference just eight minutes after starting it.

The question was lobbed at Truss during a press conference on Friday announcing the dismissal of Chancellor Kwasi Kwarteng for causing havoc in the British financial market with an unfunded tax cut. Truss had just said, “I want to be honest — this is difficult but we will get through this storm.”

In less than a month after taking office on Sept. 6, Truss has been displaying an ability to shoot herself and her party in the foot unprecedented in Western political history, bringing approval ratings for the ruling Conservative Party down to 19 percent. Britain’s tabloid paper The Daily Star has even launched a real-time webcam website for watching which will last longer: Truss or a head of lettuce.

Truss’ proposal for tax cuts was based on the Thatcherism and Reaganomics of the early 1980s, which bet on the trickle-down effect that said tax cuts, deregulation, and government spending cuts would promote economic growth, whose fruits will flow down to the lower classes. Indeed, Thatcherism and Reaganomics may have helped revitalize the economy by violently restructuring an economy in a recession. Let us for now put aside the criticism that they eventually increased the gap between the wealthy and the poor, as well as the national debt.

Upon the release of Truss’ tax cut plan, the market immediately feared the collapse of London’s financial market, the UK’s prime source of sustenance. The market worried that an unfunded tax cut would increase government debt, thereby plunging the value of the pound sterling and government bonds — reality proved these worries to be well-founded.

There was also worry that the tax cut would go against the Bank of England’s policy of monetary tightening through such measures as raising interest rates amid rising inflation, as well as concern that it would cause a spike in interest rates, including those on British government bonds. It was clear that cuts in wealth and government spending would only add a burden to the common people who suffer the most from rising prices.

The tax cut plan has been criticized by both the party and the market ever since the election for party leadership, but Truss has remained adamant. Truss did not alter her emphasis on “growth, growth, growth,” even as the financial market plunged. The plan has become a suicide bomb thrown at Britain itself, even receiving the nickname, “Kamikwasi Proposal,” a combination of Kwasi Kwarteng, who drafted the tax cut, and the kamikaze suicide pilots.

Truss’ early failure is due to her religious obsession with and stubborn insistence on the Reaganomics and Thatcherism of 40 years ago, which have even been disparaged as “voodoo economics” that rely on magic. The bigger question is from where this obsession and stubbornness originated. Truss won the race for party leadership after former Prime Minister Boris Johnson was defeated in part due to scandals including “partygate.” The decisive factor that led to Truss’ victory was the tax cut plan in question.

Truss aimed the tax cut at party members, including the 160,000 Conservative representatives who possess the power to vote, rather than at the 67 million British citizens or the market. The proposal was even more effective because Truss’ rival was Rishi Sunak, former chief secretary to the Treasury, who had drafted a corporate tax increase in Johnson’s Cabinet. Supporters of Truss still press the implementation of the tax cut plan, further going on to insist on abolishing the inheritance tax.

Truss has made the mistake of looking only at the privileged establishment of the Conservative Party. The Conservative Party won its biggest victory since 1987 in the October 2019 general election, exceeding the majority of parliamentary seats by 80. This is due to the fact that “red wall,” supporters of the Labour Party who voted for Britain’s exit from the European Union, joined forces with the Conservative Party. These supporters had expected that the country’s laboring public would be the first to benefit from Brexit. Meanwhile, the Conservative establishment expected deregulation and tax cuts from Brexit. Backlash hit when Truss, with her tax cut plan, sided only with the establishment.

Truss’ situation overlaps with that of President Yoon Suk-yeol here in South Korea. Truss, who emphasized “growth,” has spurred negative growth in the UK. Yoon, who stressed “fairness,” has been ignoring issues of fairness right in front of him, such as those related to first lady Kim Keon-hee, while using prosecutors to take care of critics within and beyond his party.

Truss does not apologize after ruining the economy with tax cuts; Yoon does not apologize after putting Koreans through the wringer with his various thoughtless remarks. Tax cuts are only what Truss talks about amid turbulence in the economy; security cooperation with Japan is the only subject Yoon will talk about amid a turbulent international situation. Truss impersonates Thatcher, while Yoon impersonates former President Lee Myung-bak. He refers to Lee as “cool” and even imitates the former president’s policies.

Above all, the two have been trapped by their supporters since assuming power. Truss is solely leaning towards the establishment among the extended supporters that enabled the landslide victory of the Conservative Party. Yoon is only courting the traditional far-right conservatives and the Yeongnam region, while shunning voters in their 20s and 30s who contributed to his victory. Just look at the appointment of Kim Moon-soo and Lee Eun-jae, famous for being foul-mouthed.

The two have become reflections of one another, each turning into the Yoon Suk-yeol of Britain and the Truss of Korea.

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

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