Korea’s Jimmy Carter

The BBC has two recent stories on labor trouble in the Korean auto industry. Hyundai just settled a strike, but at a very high cost in wages that will be passed on to customers, who have already been buying fewer of their cars. Then there’s the brain trust at GM that decided to buy Daewoo. I bet they’re wondering what they were thinking.

As most other economies in Asia are rebounding, the Korean economy is in a sustained contraction. Consumers are buying less, and industries are producing less. My sense is that Korea has spent the last seven years squandering the IMF’s money in a Keynesian binge without fixing the monopolistic incest and protection of inefficient industries that caused the 1997 crisis, and rising inflation is often a sign that the government is spending beyond its means. Roh, having missed a chance to create the conditions for real competition in Korea’s marketplace, settled for class warfare and populist corporation-bashing instead. Good politics isn’t always good leadership.

Roh’s popularity is plunging, though probably for all the wrong reasons. I suspect this mainly reflects discontent among his base, which isn’t asking why it’s graduating straight to the unemployment office.

Malaise has come to Korea. Korea, however, has a rudderless opposition with no principles, no core values, no ideas, and no inspiration to give the voters. That puts Koreans’ disgust at the impeachment of Roh in its rightful context. What alternative has anyone offered them?